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NATURE AND EXTENT OF THE PROTECTING POWER
The radical difference between “duties for revenue and “duties for the regulation of commerce" was fully understood and universally admitted, in both Great Britain and the colonies, previous to and during the Revolutionary war.
Revenue duties were regarded as taxation, pure and simple; commercial regulations, as a system of limitations and restraints on foreign and colonial intercourse and traffic, with design to secure all the advantages and benefits of the colonial trade to the parent kingdom. Sometimes it was difficult, as several occasions showed, to draw with exactness the line of separation between the two different objects of revenue and regulation—to determine with certainty whether a particular duty was imposed as a tax, or merely as a regulation of trade— because revenue might result unavoidably when duties, instead of prohibitions and other forms of restriction, were employed to give effect to the commercial policy; but it never was claimed by anybody that the power to regulate commerce could be legitimately exercised with purpose of raising a revenue. Such a purpose was alien to the whole system of trade laws, notwithstanding that some revenue might incidentally or casually arise from their practical operation; just as the paramount object of fines is to deter persons from violating certain statutory provisions, or from committing other offenses, as contempt of court, yet some revenue is inevitable when a fine is levied and paid; or just as the end regarded in using a choppingaxe may be to fell a tree, not to obtain the flow of sap, the latter being nothing more than a fortuitous happening extraneous to the result aimed at. This view of the subject was accepted, in those early days, by all classes of minds on both sides of the Atlantic, as definitively settled by long established usage. . It is true, many British legislators long held that the right to impose duties for the regulation of commerce necessarily involved the right to impose duties for raising a revenue—that these rights rested upon the same constitutional basis, and thus were one and inseparable in principle—but it was not held that the exercise of both rights looked to the same object; on the contrary, it was freely admitted that they looked to entirely different objects. Indeed, near the close of the Revolutionary war, those who maintained the identity of the two rights in authority formally recognized the difference of object, and offered, for the sake of peace and restored allegiance, that the British government would relinquish all claim to the right which was hateful to the insurgent colonies.
Benjamin Franklin, in his famous examination before the House of Commons, in 1766, recognized, in the most direct and explicit language, the distinction above stated. Question and answer were as follows:
Q.-What will be the opinions of the Americans on those resolutions? [asserting the right of Great Britain to tax America.]
A.—They will think them unconstitutional and unjust.
Q.-Was it an opinion in America, before 1763, that the Parliament had no right to lay taxes and duties there?
A.-I never heard any objections to the right of laying duties to regulate commerce, but a right to lay internal taxes was never thought to be in Parliament.
Q.-On what do you found your opinion, that the people of America make any such distinction?
A.-I know that whenever the subject has occurred in conversation, it has appeared the opinion of every one, that we could not be taxed by a Parliament where we were not represented. But the payment of duties, laid as regulations of commerce, was never disputed.
Q.-Can you name any act of assembly, or public act, making such distinction?
A.-I do not know that there was any. There was never an occasion to make any such, till now you have attempted to tax us. That has occasioned the distinction in which I think every assembly on the continent, and every member in every assembly has been unanimous.
Only a few days after Franklin's testimony, or on January 14, 1766, Lord Chatham, in his celebrated speech in the House of Commons on the Right of Taxing America," pointed out the same distinction, saying:
If the gentleman does not understand the difference between external and internal taxes, I cannot help it. There is a plain distinction between taxes levied for the purposes of raising a revenue, and duties imposed for the regulation of trade, for the accommodation of the subject; although, in the consequences, some revenue may incidentally arise from the latter.
He further said on the same occasion:
The Commons of America, represented in their several assemblies, have ever been in possession of this, their constitutional right of giving and granting their own money. They would have been slaves if they had not enjoyed it! At the same time, this kingdom, as the supreme governing and legislative power, has always bound the colonies by her laws, by her regulations and restrictions in trade, in navigation, in manufactures, in everything, except that of taking their money out of their pockets without their consent.
opinion. It is, that the Stamp Act be repealed absolutely, totally, and immediately. That the reason for the repeal be assigned, viz., because it was founded on an erroneous principle. At the same time, let the sovereign authority of this country over the colonies be asserted in as strong terms as can be devised, and be made to extend to every point of legislation whatsoever; that we may bind their trade, confine their manufactures, and exercise every power whatsoever, except that of taking their money out of their pockets without their consent.
The last two extracts from this speech exhibit, in new forms of contrast, the unlike qualities of taxation and regulation, as set forth in the first extract; for Lord Chatham declared, in the course of his argument: “It is my opinion that this kingdom has no right to lay a tax on the colonies”; hence, according to his view, the right of Great Britain to bind, by prohibitions and restraints, the trade, the navigation, and the manufactures of America, was distinct and apart from the claimed right to tax America—in other words, regulation would cease to be regulation, and be transformed into taxation, on making revenue its primary and direct object.
These quoted passages are important as showing that, a full decade before the Declaration of Independence, or almost at the very outset of the great controversy between the mother country and the colonies, the wide difference between “duties imposed for the regulation of trade,” and “duties imposed for raising a revenue" was fully understood in England, and unequivocally asserted, in the most deliberate, formal, and public manner, by competent British authority. Moreover, Lord Chatham's speech, being an able, vigorous, and fearless defense of colonial rights, attracted much attention in America, and was peculiarly well adapted
to make the distinctive and precise use of certain phrases by the great English statesman current and general, from New Hampshire to Georgia, had not such use existed already.
In subsequent speeches, he reiterated and emphasized his views on this subject, saying, in the House of Lords, January 20, 1775, on the question of “Removing Troops from Boston," what follows:
Let this distinction then remain forever ascertained; taxation is theirs, commercial regulation is ours. As an American, I would recognize to England her supreme right of regulating commerce and navigation; as an Englishman by birth and principle, I recognize to the Americans their supreme, unalienable right in their property—a right which they are justified in the defense of to the last extremity
Edmund Burke, who surpassed all his contemporaries in amplitude and subtlety of intellect, and whose fidelity to truth and justice was above reproach, fully agreed with Lord Chatham on this point. In his speech in the House of Commons, April 19, 1774, on *American Taxation,” he said:
Permit me then, sir, to lead your attention very far backback to the Act of Navigation—the corner-stone of the policy of this country with regard to its colonies. Sir, that policy was, from the beginning, purely commercial; and the commercial system was wholly restrictive. It was the system of a monopoly. No trade was let loose from that constraint, but merely to enable the colonists to dispose of what, in the course of your trade, you could not take; or to enable them to dispose of such articles as are forced upon them, and for which, without some degree of liberty, they could not pay. Hence all your specific and detailed enumerations; hence the innumerable checks and counter checks; hence that infinite variety of paper chains by which you bind together this complicated system of the colonies. This principle of commercial monopoly runs through no less than twenty-nine