On the Unconstitutionality of a National Bank
              Thomas Jefferson to President George Washington
                            February 15th, 1791


The bill for establishing a National Bank undertakes among other things:

1. To form the subscribers into a corporation.

2. To enable them in their corporate capacities to receive grants of land; and
so far is against the laws of Mortmain.[1]

3. To make alien subscribers capable of holding lands, and so far is against
the laws of Alienage.

4. To transmit these lands, on the death of a proprietor, to a certain line of
successors; and so far changes the course of Descents.

5. To put the lands out of the reach of forfeiture or escheat, and so far is
against the laws of Forfeiture and Escheat.

6. To transmit personal chattels to successors in a certain line and so far is
against the laws of Distribution.

7. To give them the sole and exclusive right of banking under the national
authority; and so far is against the laws of Monopoly.

8. To communicate to them a power to make laws paramount to the laws of the
States; for so they must be construed, to protect the institution from the
control of the State legislatures, and so, probably, they will be construed.

I consider the foundation of the Constitution as laid on this ground: That
"all powers not delegated to the United States, by the Constitution, nor
prohibited by it to the States, are reserved to the States or to the people."
(XIIth amendment [Article of the Bill of Rights].)  To take a single step
beyond the boundaries thus specially drawn around the powers of Congress,
is to take possession of a boundless field of power, no longer susceptible
of any definition.

The incorporation of a bank, and the powers assumed by this bill, have not, in
my opinion, been delegated to the United States, by the Constitution.

I. They are not among the powers specially enumerated: for these are:

1st A power to lay taxes for the purpose of paying the debts of the United
States; but no debt is paid by this bill, nor any tax laid. Were it a bill to
raise money, its origination in the Senate would condemn it by the Constitution.

2. "To borrow money."  But this bill neither borrows money nor ensures the
borrowing [of] it. The proprietors of the bank will be just as free as any
other money holders, to lend or not to lend their money to the public. The
operation proposed in the bill first, to lend them two millions, and then to
borrow them back again, cannot change the nature of the latter act, which will
still be a payment, and not a loan, call it by what name you please.

3. To "regulate commerce with foreign nations, and among the States, and with
the Indian tribes."  To erect a bank, and to regulate commerce, are very
different acts. He who erects a bank, creates a subject of commerce in its
bills, so does he who makes a bushel of wheat, or digs a dollar out of the
mines; yet neither of these persons regulates commerce thereby. To make a thing
which may be bought and sold, is not to prescribe regulations for buying and
selling. Besides, if this was an exercise of the power of regulating commerce,
it would be void, as extending as much to the internal commerce of every State,
as to its external. For the power given to Congress by the Constitution does
not extend to the internal regulation of the commerce of a State, (that is to
say of the commerce between citizen and citizen,) which remain exclusively with
its own legislature; but to its external commerce only, that is to say, its
commerce with another State, or with foreign nations, or with the Indian tribes.
Accordingly the bill does not propose the measure as a regulation of trade, but
as "productive of considerable advantages to trade." Still less are these
powers covered by any other of the special enumerations.

II. Nor are they within either of the general phrases, which are the two
following:

1. To lay taxes to provide for the general welfare of the United States, that
is to say, "to lay taxes for the purpose of providing for the general welfare."
For the laying of taxes is the power, and the general welfare the purpose for
which the power is to be exercised. They are not to lay taxes ad libitum for
any purpose they please; but only to pay the debts or provide for the welfare
of the Union. In like manner, they are not to do anything they please to
provide for the general welfare, but only to lay taxes for that purpose. To
consider the latter phrase, not as describing the purpose of the first, but as
giving a distinct and independent power to do any act they please, which might
be for the good of the Union, would render all the preceding and subsequent
enumerations of power completely useless.

It would reduce the whole instrument to a single phrase, that of instituting a
Congress with power to do whatever would be for the good of the United States;
and, as they would be the sole judges of the good or evil, it would be also a
power to do whatever evil they please.

It is an established rule of construction where a phrase will bear either of
two meanings, to give it that which will allow some meaning to the other parts
of the instrument, and not that which would render all the others useless.
Certainly no such universal power was meant to be given them. It was intended
to lace them up straitly within the enumerated powers, and those without which,
as means, these powers could not be carried into effect. It is known that the
very power now proposed as a means was rejected as an end by the Convention
which formed the Constitution. A proposition was made to them to authorize
Congress to open canals, and an amendatory one to empower them to incorporate.
But the whole was rejected, and one of the reasons for rejection urged in
debate was, that then they would have a power to erect a bank, which would
render the great cities, where there were prejudices and jealousies on the
subject, adverse to the reception of the Constitution.

2. The second general phrase is, "to make all laws necessary and proper for
carrying into execution the enumerated powers."  But they can all be carried
into execution without a bank. A bank therefore is not necessary, and
consequently not authorized by this phrase.

It has been urged that a bank will give great facility or convenience in the
collection of taxes, Suppose this were true: yet the Constitution allows only
the means which are "necessary," not those which are merely "convenient" for
effecting the enumerated powers. If such a latitude of construction be allowed
to this phrase as to give any non-enumerated power, it will go to everyone, for
there is not one which ingenuity may not torture into a convenience in some
instance or other, to some one of so long a list of enumerated powers. It would
swallow up all the delegated powers, and reduce the whole to one power, as
before observed. Therefore it was that the Constitution restrained them to the
necessary means, that is to say, to those means without which the grant of
power would be nugatory.

But let us examine this convenience and see what it is. The report on this
subject, page 3, states the only general convenience to be, the preventing the
transportation and re-transportation of money between the States and the
treasury (for I pass over the increase of circulating medium, ascribed to it as
a want, and which, according to my ideas of paper money, is clearly a demerit.)
Every State will have to pay a sum of tax money into the treasury; and the
treasury will have to pay, in every State, a part of the interest on the public
debt, and salaries to the officers of government resident in that State. In
most of the States there will still be a surplus of tax money to come up to the
seat of government for the officers residing there. The payments of interest
and salary in each State may he made by treasury orders on the State collector.
This will take up the greater part of the money he has collected in his State,
and consequently prevent the great mass of it from being drawn out of the State.
If there be a balance of commerce in favor of that State against the one in
which the government resides, the surplus of taxes will be remitted by the
bills of exchange drawn for that commercial balance. And so it must be if there
was a bank. But if there be no balance of commerce, either direct or circuitous,
all the banks in the world could not bring up the surplus of taxes, but in the
form of money. Treasury orders then, and bills of exchange may prevent the
displacement of the main mass of the money collected, without the aid of any
bank; and where these fail, it cannot be prevented even with that aid.
Perhaps, indeed, bank bills [of credit] may be a more convenient vehicle than
treasury orders. But a little difference in the degree of convenience cannot
constitute the necessity which the Constitution makes the ground for assuming
any non-enumerated power.

Besides, the existing banks will, without a doubt, enter into arrangements for
lending their agency, and the more favorable, as there will be a competition
among them for it; whereas the bill delivers us up bound to the national bank,
who are free to refuse all arrangement, but on their own terms, and the public
not free, on such refusal, to employ any other bank. That of Philadelphia I
believe, now does this business, by their post-notes, which, by an arrangement
with the treasury, are paid by any State collector to whom they are presented.
This expedient alone suffices to prevent the existence of that necessity which
may justify the assumption of a non-enumerated power as a means for carrying
into effect an enumerated one. The thing may be done, and has been done, and
well done, without this assumption, therefore it does not stand on that degree
of necessity which can honestly justify it.

It may be said that a bank whose bills [of credit] would have a currency all
over the States, would be more convenient than one whose currency is limited to
a single State. So it would be still more convenient that there should be a
bank, whose bills [of credit] should have a currency all over the world. But it
does not follow from this superior conveniency, that there exists anywhere a
power to establish such a bank; or that the world may not go on very well
without it. Can it be thought that the Constitution intended that for a shade
or two of convenience, more or less, Congress should be authorized to break
down the most ancient and fundamental laws of the several States; such as those
against Mortmain, the laws of Alienage, the rules of descent, the acts of
distribution, the laws of escheat and forfeiture, the laws of monopoly?
Nothing but a necessity invincible by any other means, can justify such a
prostitution of laws, which constitute the pillars of our whole system of
jurisprudence. Will Congress be too strait-laced to carry the Constitution into
honest effect, unless they may pass over the foundation-laws of the State
government for the slightest convenience of theirs?

The negative of the President is the shield provided by the Constitution to
protect against the invasions of the legislature: 1. The right of the Executive.
2. Of the Judiciary. 3. Of the States and State legislatures. The present is
the case of a right remaining exclusively with the States, and consequently one
of those intended by the Constitution to be placed under its protection.
It must be added, however, that unless the President's mind on a view of
everything which is urged for and against this bill, is tolerably clear that it
is unauthorized by the Constitution, if the pro and the con hang so even as to
balance his judgment, a just respect for the wisdom of the legislature would
naturally decide the balance in favor of their opinion. It is chiefly for cases
where they are clearly misled by error, ambition, or interest, that the
Constitution has placed a check in the negative of the President.

[1] Though the Constitution controls the laws of Mortmain so far as to permit
Congress itself to hold land for certain purposes, yet not so far as to permit
them to communicate a similar right to other corporate bodies.

Th: Jefferson.
February 15th, 1791.