Reconstructing the National Bank Controversy: Politics and Law in the Early American Republic

Reconstructing the National Bank Controversy

Reconstructing the National Bank Controversy

Politics and Law in the Early American Republic

Eric Lomazoff

The University of Chicago Press

CHICAGO & LONDON

The University of Chicago Press, Chicago 60637

The University of Chicago Press, Ltd., London

© 2018 by The University of Chicago

All rights reserved. No part of this book may be used or reproduced in any manner whatsoever without written permission, except in the case of brief quotations in critical articles and reviews. For more information, contact the University of Chicago Press, 1427 E. 60th St., Chicago, IL 60637.

Published 2018

Printed in the United States of America

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ISBN-13: 978-0-226-57931-3 (cloth)

ISBN-13: 978-0-226-57945-0 (paper)

ISBN-13: 978-0-226-57959-7 (e-book)

DOI: https://doi.org/10.7208/chicago/9780226579597.001.0001

Library of Congress Cataloging-in-Publication Data

Names: Lomazoff, Eric, author.

Title: Reconstructing the national bank controversy : politics and law in the early American Republic / Eric Lomazoff.

Description: Chicago : The University of Chicago Press, 2018. | Includes bibliographical references and index.

Identifiers: LCCN 2018017410 | ISBN 9780226579313 (cloth : alk. paper) | ISBN 9780226579450 (pbk. : alk. paper) | ISBN 9780226579597 (e-book)

Subjects: LCSH: Bank of the United States (1791–1811)—History. | Bank of the United States (1816–1836)—History. | Constitutional history—United States. | Law—Political aspects—United States—History—19th century. | Banking law—United States—History—19th century.

Classification: LCC HG2529 .L66 2018 | DDC 346/.082—dc23

LC record available at https://lccn.loc.gov/2018017410

This paper meets the requirements of ANSI/NISO Z39.48-1992 (Permanence of Paper).

To my dear Kate

Contents

Acknowledgments

Introduction: Getting the Ship out of the Bottle

1.  Varieties of Strict Interpretation

2.  Banco Mania and Institutional Drift

3.  The Great Regulating Wheel and Institutional Conversion

4.  More Than a Constitutional Rerun

5.  The Compromise of 1816

6.  McCulloch (1819) in the Shadow of the Compromise

7.  A Tale of Two Clauses

Conclusion: A Revisionist Bank Narrative—Lessons Timely and Timeless

Notes

Bibliography

Index

Acknowledgments

This book has its origins in research conducted within the Department of Government at Harvard University. The scholars who so ably advised me there included two political scientists, Daniel Carpenter and Nancy Rosenblum, and one economic historian, Robert E. Wright. Each offered unstinting support for a project that lay somewhat outside his or her already-sizable intellectual wheelhouse, and I will always be grateful for these acts of generosity.

Over the years, a number of other scholars have read and commented on various versions of the arguments found here. For that I am grateful to Alan Gibson, Mark Graber, Peter A. Hall, Richard John, Sandy Levinson, Julie Novkov, Stephen Skowronek, Kathleen Thelen, Justin Wert, and Emily Zackin.

Support from a number of institutions facilitated the research and writing that led to this book. These include Harvard’s Center for American Political Studies (where Lilia Halpern-Smith did yeoman’s work), the Miller Center of Public Affairs at the University of Virginia (where Brian Balogh and Sid Milkis deserve special thanks), and the University of Oklahoma College of Arts and Sciences (which provided a Junior Faculty Summer Fellowship following my first year as a faculty member).

It is a privilege to teach, write, and serve at Villanova University. My colleagues in the Department of Political Science render working at Villanova a true pleasure as well. David Barrett and Catherine Warrick warrant special mention here, as they took the time to mentor a junior colleague during his first days at the university. While their mentorship continues, I cherish the fact that it has been supplemented by real friendship. Speaking of which: coffee in the department lounge in five minutes?

With respect to mentors and friends, I also need to acknowledge three fellow travelers in the world of American constitutionalism. Justin Wert is no Louis Brandeis, and I am surely no Felix Frankfurter, but I like to think that Brandeis’s conception of Frankfurter as half brother, half son nicely captures my relationship to Justin; he has been helping me to navigate the world of public law (not to mention life generally) for close to twenty years now. While I probably would have encountered Emily Zackin at some point as a political scientist, our chance meeting at the 2010 Policy History Conference in Columbus offered me an early introduction to a very talented colleague and an even better friend. And long before the national bank controversy was on my radar, Will Harris taught me about the Constitution for the first time.

I owe a special debt of gratitude to Chuck Myers at the University of Chicago Press. The journey from submitted manuscript and peer review through contract and publication was, in my case, especially long and bumpy. More to the point, the ultimate completion of that journey owes much to Chuck’s belief in (and support for) the project. For assistance between contract and publication, a number of other individuals working at or with the press—Holly Smith, Christine Schwab, Carol McGillivray, and Melinda Kennedy among them—are also deserving of my heartfelt thanks.

To write publicly about Kate McKinley is to invite private scandal, as she would surely prefer that most of the world know as little about her as possible. The small circle in which this monograph will probably travel should allay most of her concern. As for the rest, an opportunity to celebrate her leaves me eager to court domestic disaster. The gift of Kate’s love has changed me forever, and it has made possible not simply this book but (far more importantly) the life we share beyond it. For me at least, the most important words in Reconstructing the National Bank Controversy are the four on the dedication page.

Eric Lomazoff

Bryn Mawr, Pennsylvania

January 2018

Introduction

Getting the Ship out of the Bottle

The Conventional Wisdom

In 1791, Secretary of State Thomas Jefferson picked up where several members of Congress had left off, arguing to President George Washington that Congress could not charter a national bank under the Necessary and Proper Clause. In response, Treasury Secretary Alexander Hamilton offered the president a broader interpretation of congressional power under that provision. Washington proceeded to sign the bill that had inspired the dispute, and the Bank of the United States was born. In 1811, its charter expired.

In 1819, lawyers for the state of Maryland found themselves repeating Jefferson’s argument, this time to the Supreme Court. Unsurprisingly, counsel for their opponent—a national bank chartered in 1816 and bearing the same name as its predecessor—echoed Hamilton’s claims. Chief Justice John Marshall, writing for a unanimous Court in McCulloch v. Maryland, affirmed the institution’s legitimacy and offered a decidedly Hamiltonian take on the meaning of the so-called Sweeping Clause.

In 1832, Congress passed legislation extending the life of the second Bank beyond 1836, when its charter was set to expire. President Andrew Jackson vetoed the bill and issued a lengthy message justifying his decision. After stressing that the Supreme Court’s decision in McCulloch did not preclude his own constitutional judgment, Jackson explained why he considered the Bank of the United States both unnecessary and improper.

Ask any scholar of American constitutionalism for a decent capsule summary of the national bank debate, and you will probably receive something quite close to the foregoing account. If he or she is inclined toward a pithier response, you will simply be told that the Bank served as the recurring touchstone for a two-sided debate over how to interpret the Necessary and Proper Clause.¹ Briefer still would be a claim that federal officials spent forty years arguing over the meaning of the word necessary.

On the assumption that nearly every response to your query would vary only with respect to length, we can draw two immediate conclusions. First, the Bank controversy is a kind of set piece in the constitutional history of the Early American Republic.² Every scholar tells some version of the same basic story. Second, the defining feature of that story is stability over time. The terms of the constitutional conflict never change, only the participants.

This is not a book about how the set piece emerged.³ This is a book about why the set piece fails to capture the full Bank controversy. In fact, it does not even come close.

The traditional account is easy to engage with. It imbues at least a small portion of our constitutional history with a real sense of order. And, regardless of your own position on the meaning of the Necessary and Proper Clause, there are good guys to be found.

This book offers a far more robust account of the constitutional politics of national banking between 1791 and 1832. My account is harder to engage with, in part because it shows that the Coinage Clause of Article I, Section 8—Congress’s power to coin Money, regulate the Value thereof—was as crucial to the constitutional action as the Sweeping Clause.⁴ It draws belated attention to the less-than-orderly manner in which three forces—gradual change within the Bank itself, growing tensions over federal power among Republicans, and the endurance of monetary turmoil beyond the War of 1812—worked to reshape the constitutional debate during the early to mid-1810s. By the time John Marshall penned McCulloch, we had something close to an agreement between Republicans and Federalists that a national bank was constitutional, yet deep disagreement as to why that was so—precisely the sort of middle ground that can belie a clear distinction between good guys and bad guys.

To recast the Bank debate in this manner is also to powerfully reinforce (and, I will argue, refine) the proposition that our constitutional conflicts are routinely shaped as much by politics as by law. Institutional change, partisan infighting, and the economic consequences of war should strike readers as the everyday stuff of politics. These forces drove the development of our first major debate over the scope of federal power at least as much as the formal dimensions of the Constitution (for example, its failure to identify a supreme interpreter) or the absence of a shared legal definition for the word necessary. In that sense, this book renders the Bank controversy even more foundational to American constitutionalism than it already is.

First Central Argument: The Bank Debate Was Dynamic

Our standard narrative of the Bank debate, to borrow a metaphor recently employed by Pamela Brandwein, is akin to a ship in a bottle; it is a structure so firmly established that it look[s] as though it always must have been just as it [is].⁵ My first central argument⁶ is that this narrative needs to come out of its bottle of validity.⁷ The claims respecting Congress’s power (or lack thereof) to charter the institution were constantly evolving between 1791 and 1832, and at no point during this period were they limited to one broad and one strict interpretation of the Necessary and Proper Clause.

The case for dispensing with our traditional account begins in 1791, when the opponents of Secretary Hamilton’s national bank bill offered not one but several strict interpretations of the Sweeping Clause. Hamilton and others had claimed that the provision authorized Congress to enact any law that would contribute to, or be useful for, the exercise of an enumerated power. Because a national bank would facilitate the collection of taxes and the borrowing of money, their argument went, a law creating one was necessary for executing those Article I powers.

The bill’s opponents uniformly rejected this broad interpretation. Agreement on what the Necessary and Proper Clause actually meant proved more elusive. All of them suggested, in language that varied slightly from person to person, that a law was not necessary unless the means chosen bore a very close relationship to the authorized end. The standard narrative treats every 1791 national bank opponent as making this claim and this claim alone. Several elected and unelected officials went further, however, arguing that Congress also had to lack viable alternatives for achieving the end in question. One member of the House even went so far as to supplement these two requirements with a third: Congress was restricted to the means typically employed by other governments in pursuit of a given end.

Our traditional account takes little notice of 1811, a year that saw both an extended congressional debate over the Bank’s constitutionality and convergence among the institution’s opponents on a particular interpretation of the Sweeping Clause. The Bank of the United States had received a twenty-year charter in 1791, and its directors petitioned Congress for an extension of the same as 1811 approached. The ensuing debate saw at least thirty-five federal lawmakers speak to the constitutional question.⁸ The Bank’s supporters continued to uniformly insist that because the institution contributed to the management of the federal government’s fiscal affairs, it was necessary for executing one or more Article I powers. This time around, only a handful of their opponents offered up the stand-alone complaint that necessary means had to more or less directly achieve an end (rather than merely facilitate its achievement). By contrast, many more Bank critics tested the institution against both this requirement and the requirement that Congress lack alternative means for achieving the same end. These lawmakers concluded, almost to a man, that in 1811 a national bank met neither condition.

The standard Bank narrative also treats 1816 as a year of little constitutional import, despite the fact that federal lawmakers both revived the institution and managed to do so while saying nary a word about the Necessary and Proper Clause. The Bank of the United States shuttered its doors in March 1811 after Congress narrowly rejected a charter extension bill, but its death ultimately proved short-lived. In December 1815, Treasury Secretary Alexander J. Dallas proposed legislation to charter a new national bank. A bill to this effect was introduced in late February 1816 and became law less than two months later. Neither Secretary Dallas nor the lawmakers who shepherded the bill through Congress had suggested that it was necessary for collecting taxes or borrowing money. Instead, they argued that it exercised Congress’s power to coin Money, regulate the Value thereof. Whether this meant that the power to coin money was being directly exercised, or that a national bank was manifestly necessary for exercising the same, was never made clear. The result, however, was all too clear: Congress had chartered a national bank with recourse to the Coinage Clause and without a third round of debate over the meaning of the Sweeping Clause.

Because our traditional account ignores the fact that the national bank was rebuilt on novel constitutional ground in 1816, it naturally fails to recognize that the Supreme Court all but openly rejected the Coinage Clause argument in deciding McCulloch v. Maryland (1819). After the Bank of the United States challenged the constitutionality of Maryland’s 1818 tax on it, John Marshall and his colleagues agreed to hear the dispute. In doing so, however, the Marshall Court also requested oral argument on a second (and logically prior) question: Was the Bank itself constitutional? In answering this question, counsel on both sides eschewed discussion of Congress’s recent reliance on the Coinage Clause, opting instead to revive older claims about the Bank’s necessity (or lack thereof) for exercising other Article I powers. Marshall’s ensuing opinion for the Court was also silent with respect to Congress’s power to coin money. While his holding that Congress was empowered to charter the Bank may not have rested principally on the Necessary and Proper Clause,⁹ the opinion nonetheless embraced a broad interpretation of the same. The chief justice’s case for that interpretation included an assertion that the existence of alternative means for achieving an enumerated end could have no possible influence on the question of whether Congress’s chosen means were necessary.¹⁰

Our standard narrative stresses that President Jackson judged the Bank unnecessary in rejecting 1832 legislation to extend its charter but fails to acknowledge that his veto message explicitly addressed the Coinage Clause as an alternative anchor for the institution. The Court’s decision in McCulloch hardly sounded the death knell for claims respecting Congress’s power to coin money. After Jackson’s first message to Congress (December 1829) questioned the Bank’s constitutionality, a House committee offered mere recognition to the argument that the institution was necessary for collecting taxes and borrowing money but open support for the idea that it was valid under the Coinage Clause. When Congress considered a bill to extend the national bank’s charter a few years later, the most frequent constitutional claim on behalf of the institution concerned the power to coin money. After passage of the bill, President Jackson justified his decision to veto it by suggesting both that he was free under McCulloch to evaluate the Bank’s necessity and that Congress had overstepped (or, barring that, improperly delegated) its power under the Coinage Clause.

Second Central Argument: Ordinary Politics Drove Much of That Dynamism

If the debate over a national bank was dynamic, then it makes sense to ask why that was the case. My second central argument is that much of the variation in constitutional interpretation that we observe between 1791 and 1832 is attributable to forces that have little to do with the Constitution or law more broadly: institutional change, ideological conflict, and economic stress.¹¹ As we will see, these three forces—sometimes alone and sometimes in combination—repeatedly reshaped the terms on which the Bank’s constitutionality was contested. The influence of ordinary politics on constitutional argument during this period was hardly complete, however. Those who participated in post-1816 debates over the Bank’s constitutionality, for example, largely picked and chose from the smorgasbord of arguments already in existence, and I will argue that their basic ability to do so flowed from the Constitution itself.

To capture the effect of ordinary politics on the national bank debate, we need to document where those three dimensions of the polity¹² stood in early 1791 as well as how they changed over time and then trace the manner in which those changes periodically led federal officials to prioritize, invent, discard, or merely select among certain claims about constitutional meaning.¹³ This book both documents and traces, but the former in particular will require—and I intend this as part description and part disclaimer—that we sometimes go for lengthy stretches far from the Constitution or disputes over its meaning.

Our baseline institutional, ideological, and economic conditions are those under which the 1791 national bank debate took place. The young republic was at peace in February 1791, and prices for goods and services were relatively stable.¹⁴ American banking was still very much in its infancy, as just three cities (Boston, Philadelphia, and Baltimore) played host to banks authorized by their respective state governments and none of those institutions had more than $2 million in capital.¹⁵ The First Congress was not yet formally organized along party lines, but both chambers were controlled by members who generally took a capacious view of federal power and would subsequently affiliate with the Federalists.¹⁶ Given the ideological conditions in particular, it is hardly surprising that Secretary Hamilton’s proposal for a $10 million national bank to support the federal government’s fiscal operations was able to withstand a constitutional challenge in the House. As for the character of that challenge (to recall, a number of strict interpretations of the Sweeping Clause were offered in 1791), we need to remember that this debate represented the first postratification opportunity for federal officials to float ideas respecting the provision’s meaning. As such, it makes sense that those who opposed a national bank (and agonized to varying degrees about future exercises of federal power) used the occasion to test out different conceptions of constitutional necessity.

Altered ideological and institutional conditions led participants in the Bank debate of 1811 to focus on the relevance of alternative means for discerning constitutional necessity. The years between 1791 and 1811 witnessed not simply the birth of the Republican party and its seizure of both Congress and the presidency in the elections of 1800 but the subsequent appearance of serious divisions among its members over the legitimate scope of federal power.¹⁷ Running parallel to these ideological developments was a slow but steady diminution of the national bank’s industry dominance. While the Bank of the United States had but a handful of competitors upon birth and controlled roughly 70 percent of total industry capital, by 1811 the number of state banks had crossed the century mark and Hamilton’s brainchild appeared less a financial leviathan and more the biggest fish in an increasingly crowded pond.¹⁸ I demonstrate that these ideological and institutional changes bear primary responsibility for the fact that the 1811 debate over the Bank’s constitutionality meaningfully departed from its 1791 predecessor. The constitutional critics in Congress now not only enjoyed strength in numbers but displayed newfound agreement on textual meaning: Because the Bank was not closely related to one or more enumerated powers, and a network of state banks could be employed to manage the federal government’s fiscal affairs, the institution met neither requirement imposed by the Necessary and Proper Clause.

Those who revived a national bank in 1816 went where no constitutional interpreters had gone before—a journey that began with economic crisis and continued through both institutional change and ideological accommodation. After British forces climbed the Chesapeake Bay and assaulted the nation’s capital in August 1814, most state banks located south and west of New England quickly suspended the payment of specie for their notes and checks.¹⁹ The value of this paper quickly depreciated, and millions of Americans who used said paper were just as quickly introduced to price inflation.²⁰ Citizens cared less about the wartime onset of inflation, however, than its endurance beyond the Treaty of Ghent. When state banks proved unwilling to resume specie payments on their own, I will argue, Republicans in Congress looked to the past for a solution. There had been a second slow-moving change in the national bank between 1791 and 1811: The institution had developed the capacity to regulate its state-chartered peers, or force them to observe some proportion between their specie reserves and their lending.²¹ The resulting hope among Republican lawmakers was that a revived Bank would bring the state institutions to heel. This scheme furnished no solution to their constitutional problem, however. In 1811, the party’s deep divisions over federal power had been on full display. The war and its aftermath had reconciled many Republicans to a national bank, but not to federal power more broadly. Could the institution be revived without embracing a broad interpretation of the Sweeping Clause—that is, without seeming to sanction things such as federal support for internal improvements or a ban on slavery in federal territories? I demonstrate that leading party members cut this Gordian knot by presenting their national bank bill in novel constitutional terms: as an exercise of Congress’s power to coin Money, regulate the Value thereof.

While legal factors explain the Supreme Court’s ability in McCulloch (1819) to opt for one understanding of the Bank’s constitutionality over another, the reason it chose the Necessary and Proper Clause remains unclear. Three years after Congress revived the Bank of the United States under the Coinage Clause, the Court asked anew whether the Constitution empowered federal lawmakers to charter the institution. Even if John Marshall and his colleagues were to conclude (as they did) that the Bank was constitutional, they were hardly obligated to do so for the reason laid out by Congress. I will argue that two features of the Constitution—Article VI’s requirement that all federal judges (not to mention federal lawmakers) be bound by Oath or Affirmation to support it and its failure to identify a supreme interpreter—are responsible for this fact. Taken together, these features empowered the justices to reach their own conclusions with respect to the textual anchor for congressional activity. Law can only reliably explain so much of McCulloch, however. It cannot, for example, necessarily solve a mystery of judicial behavior that this book introduces: Why did the Court discard Congress’s understanding of the Bank’s constitutionality in favor of an understanding that partook (at least in part) of Secretary Hamilton’s 1791 reasoning?

In 1832, a confluence of law and ideology led Congress to reassert the national bank’s constitutionality under the Coinage Clause, and this move all but forced the institution’s leading antagonist to author a veto message that engaged multiple claims respecting textual meaning. Just as the Constitution did not compel the Supreme Court (in deciding McCulloch) to follow Congress’s 1816 understanding of the Bank’s constitutionality, it did not compel members of a post-McCulloch Congress to follow the Court’s understanding of the same. The Democrats who controlled Congress in 1832 were, like many of the mid-1810s Republicans from whom they descended,²² wary of an active federal government but generally convinced of a national bank’s importance. This ideological orientation, I argue, led them to eschew McCulloch’s reasoning and pass legislation for extending the Bank’s life on the same constitutional terms as their partisan ancestors had given that life in 1816. The behavior of congressional Democrats left President Jackson in a bind. To veto the charter extension as beyond the scope of federal power, he would need to address two very different accounts of the Bank’s constitutionality: one furnished by the Court and a second by Congress itself. This is precisely what Jackson’s veto message did.

Third Central Argument: The Bank Debate Reinforces and Refines the Role of Ordinary Politics in Constitutional Development

This book is about more, however, than jettisoning our traditional account of the Bank debate in favor of a more dynamic constitutional conflict shaped in large part by ordinary politics. My third and final central argument is that this account of the national bank controversy works to both reinforce and refine the general proposition that such politics are important drivers of American constitutional development. With respect to reinforcement, the Bank debate was already foundational to American constitutionalism in that it was the most important and sustained . . . controversy in the early republic over how strictly [federal power] should be construed.²³ This book burnishes that status by casting the means by which this controversy developed as a veritable sampling of the broader range of forces that would shape constitutional politics going forward and down to the present day. As for refinement, my account works to both sharpen our understanding of ideological conflict and economic stress as agents of constitutional development and offer slow-moving institutional change a place in that same category.

Consider, for example, my claim that ideological conflict among Republicans over the scope of federal power worked to reshape the Bank debate, especially between 1811 and 1816. Students of American constitutionalism have long been familiar with the notion that tension within political regimes, or party coalitions with long-term control over the government’s basic commitments of ideology and interest,²⁴ can drive constitutional development. The standard claim here is that regime leaders will encourage federal courts, which they have staffed with an eye to advancing the regime’s vision of constitutional governance,²⁵ to act whenever pieces of that vision divide members to the point of inhibiting legislative and/or executive action.²⁶ My account of the Bank debate reaffirms the importance of intraparty conflict for constitutional development while denying that deference to the judiciary is the only option for divided regimes. They are also free to broker internal compromises on questions of constitutional governance, though federal courts (as McCulloch reveals) are not obliged to honor them.

This book offers similar confirmation for (and amendment to) the claim that economic forces have meaningfully shaped constitutional politics. On the one hand, three major flash points in American constitutional history—1787, the mid- to late 1860s, and 1937—already speak to the salience of these forces. State legislatures enjoyed almost limitless power to embargo or slap fees on imports, exports, or vessels from other countries or states in the 1780s, and the resulting slew of protectionist laws both helped to produce the Constitutional Convention and led to its delegates’ call for federal power to regulate Commerce with foreign Nations, and among the several States[.]²⁷ The Civil War, which wrought enough constitutional change to qualify as a second founding,²⁸ sprang at least in part from Southern anxiety that the 1860 election of Abraham Lincoln (coupled with the rise of Republican majorities in both the House and Senate) posed an existential threat to slavery, the primary source of labor for its agricultural economy.²⁹ And the Supreme Court’s early twentieth-century police powers jurisprudence, whether conceived as the expression of a free-market ideology or as a principled effort to weed out class legislation, was complicated and ultimately derailed by industrialization, or the maturation of capitalist forms of production[.]³⁰ Appreciation for the role of economic forces in shaping high-profile constitutional moments,³¹ however, may blind us to the fact that these forces also drive more run-of-the-mill constitutional development. My account of the national bank’s rebirth supplies an important corrective here by tying the appearance of the Coinage Clause argument in part to the price inflation that lingered beyond the February 1815 cessation of hostilities with Great Britain.

Far more novel is my suggestion that gradual change in an institution once subject to constitutional challenge can alter the terms of future debate over its status. The study of slow-moving institutional transformations sprang from a perception that students of comparative political economy were too preoccupied with a model of institutional change in which long periods of . . . stasis were separated by much shorter periods of radical reorganization.³² To my knowledge, no one has made the case that this scholarship is relevant for the study of American constitutionalism. I make that case here, drawing attention to slow-moving transformations in the Bank and (more importantly) their downstream effects on its constitutional politics. The institution underwent two gradual changes between 1791 and 1811—drift from its initial position of market dominance and conversion into a regulator of state banks³³—and my estimate of their respective roles in shaping future iterations of the Bank debate is reflected in the fact that each receives chapter-length treatment.

For several decades now, students of American constitutionalism have been hammering away at the idea that important developments in our constitutional practice take place outside the courts or law more broadly defined.³⁴ My account of the Bank controversy fits squarely in this tradition, calling attention to the developmental import of institutions, ideology, and economics without denying the importance of law. By the same token, however, it also reminds us that general propositions respecting the influence of ordinary politics must remain open to both amendment and expansion. Divided regimes do not always punt the ball to courts; they sometimes call the constitutional version of an audible. Smaller waves of constitutional development, not simply tsunamis, hit our shores when economic energy is released. And when the object at the center of a constitutional controversy changes, we cannot act surprised when a future conversation about its status follows suit.

A Brief Overview

The organization of this book is somewhat irregular, and the device that opens a number of its chapters also warrants comment. Because changes in the Bank following its 1791 birth had such a significant effect on subsequent debates over its status, they must be documented within a broader retelling of its constitutional history. I have chosen to do this by recounting the 1791 debate (chapter 1), pausing to consider the institution’s transformations over the following two decades (chapters 2 and 3), and then examining the constitutional effects of these and other forces between 1811 and 1832 (chapters 4 through 7). The procession here is thus chronological without being exclusively constitutional.

I opened this book with a vignette that captures our traditional account of the national bank debate. Vignettes, I hasten to add, also open every chapter save chapter 2, chapter 3, and the conclusion. Their purpose in these contexts is more specialized than it is here: confronting readers with the conventional wisdom respecting a given round of the national bank controversy. Their use is inspired by the chapter-opening vignettes in A Monarchy Transformed, Mark Kishlansky’s chronicle