The Federal Reserve is the engine that drives the biggest, most powerful government in the history of the world.
We can trace the origins of this modern central bank back to the creation of the First Bank of the United States, even before ratification of the Bill of Rights. Even then, it was built on dubious constitutional justifications, but it wasn’t created without a fight. The arguments advanced by the bank’s opponents provide a great deal of insight into the original understanding of the Constitution and the American system as it was conceived.
Congress chartered the First Bank of the United States on Feb. 25, 1791.
A national bank was the brainchild of Alexander Hamilton. His rationale wasn’t much different from those who later came up with the Federal Reserve. Hamilton thought a central bank was necessary to stabilize and improve the fledgling nation’s credit and to better manage the financial business of the United States government. He also knew that his vision of a powerful national government was impossible without a central bank to backstop government borrowing.
Hamilton’s bank plan sparked intense debate. It wasn’t merely an argument about the need for a bank or the functions it should perform. The opposition to the national bank led by Thomas Jefferson and James Madison was far more fundamental and based on constitutional grounds.
The National Bank vs. the Constitution digs deep into the arguments presented by Hamilton and the constitutional counterarguments offered by Madison, Jefferson and other opponents of the bank, such as Edmund Randolph. It also offers a concise overview of the history of the Federal Reserve and the role of central banking in the United States.
The story is about more than central banking. It’s really a battle for the heart and soul of America’s constitutional system.
If you understand the constitutional arguments against the First Bank of the United States, you will have a solid grasp on the constitutional arguments against much of the unconstitutional monster state we live under today.
Paperback: 62 pages
Publisher: Tenth Amendment Center (2021)