Limited Government  

The principle of limited government is the idea that to keep the governing power to its proper scope, the government must be limited to particular purposes and provide recourse for citizens to be protected from arbitrary power. In other words, the American government is based upon a constitutional rule of law not people and personalities. This protects popular self-rule and the rights and liberties of the people. However, the Framers created a constitutional government with vigorous powers to achieve the ends for which it was created. This delicately balances the proper exercise of government powers with the liberties of the people.  

Limited government can be supported in many ways. It can be an expression of politicians faithfully following the Constitution and showing restraint in their powers while pursuing the public good. It can be citizens and politicians deliberating over laws and policies together that demonstrate consensus-building in a constitutional manner. It can be when voluntary associations, individuals, and communities act in a charitable or philanthropic way to solve problems instead of government. It can be local and state governments that solve problems locally instead of the national government.  

Throughout American history, debates have surfaced relating to the limits of governmental power. Americans continually seek to find the appropriate balance between the proper limits of government and the extent of power required by the government to effectively function. Below are a series of case studies where this balance was debated. As you read, keep this balance and mind and determine for yourself if the country got it right.  

The Constitutional Debate over National Bank, 1790s 

One of the great challenges of the new nation was to get the country’s finances in order. One of the main parts of Secretary of the Treasury Alexander Hamilton’s financial plans was to create a national bank. Hamilton had a masterful blueprint for creating a national bank that he submitted to Congress in December 1790.  

Hamilton wanted to create an engine of prosperity by taking deposits and lending them out for investment by the people in a variety of productive enterprises (such as agriculture, early industry, and shipping) across the country. He thought that the government was limited but did have a role in promoting the growth of the private market by providing the basis for entrepreneurs to thrive. This stirred controversy because the Constitution did not specifically authorize a national bank.  

When the bill to create the bank was introduced in Congress, many southerners and Jeffersonian Republicans were opposed. They feared that the national bank would centralize power in the national government over the economy and only benefit a small group of corrupt elites. It would create an aristocracy, and the people would lose self-government.  

Congress passed the bill over the objections of its opponents. The bill went to President George Washington for signing into law or vetoing. He was not sure if Congress had the power to create a bank due to the debate, and he asked for the opinions of his cabinet to help him deliberate.  

Opponents like Thomas Jefferson argued that the bank was unconstitutional because the power did not exist under Congress’s enumerated powers under Article I, section 8. He thought chartering banks was a power of the states. Hamilton and his supporters argued that a bank was related to many of the constitutional powers of Congress and therefore legitimate under the Necessary and Proper Clause of Article I, section 8.  

President Washington considered the opinions carefully and deliberated over his constitutional responsibilities as president. Ultimately, he agreed with Hamilton’s argument and signed the national bank bill into law.  

Because the bank’s charter lasted only 20 years, it expired in 1811 and was not renewed after a new round of constitutional deliberation among the different branches of government. However, in 1816, President James Madison changed his mind and signed the Second Bank of the United States into law after both houses of Congress passed it. In McCulloch v. Maryland (1819), the Supreme Court ruled that the bank was constitutional.  

The debate over the national bank demonstrated that each branch of government has a responsibility to take the Constitution seriously in exercising their powers. The Congress held a vibrant and lively debate about the constitutionality of the bank and its merits. The president carefully considered the various sides of this debate and came to his own conclusion about the proper extent of government power. Finally, the Supreme Court reviewed the issue of the bank and its constitutionality.  Ultimately, the debate concluded that the bank was an energetic exercise of the powers of the national government within constitutional boundaries. Despite this conclusion, the different branches of government continued to engage in debates over the bank and the role of the national government for decades. 

 

Grover Cleveland and the Texas Seed Bill  

In the mid-1880s, farmers and ranchers in west Texas were experiencing a terrible drought. When the grazing grass died, 85 percent of the cattle perished. The starving people desperately lived on feed corn that was the only available food during the drought.  

Congress took note of their plight and moved to consider a bill that would provide temporary relief to the stricken farmers. Both houses of Congress passed the bill, which included a relatively small appropriation of $10,000 for the farmers. However, when the bill landed on President Grover Cleveland desk, he saw it as his constitutional duty to veto the Texas Seed Bill.  

Cleveland was elected in 1884 and was a Democrat who believed in limited government. He was a defender of honest, efficient, and small government. He supported civil service reform in the national government to ensure that people were hired for government jobs based upon merit rather than the patronage system that rewarded support for a candidate or political party. Since tariff revenue was swelling the federal budget surplus, he wanted to lower tariffs and return the money to the people.  

The Republican Party at the time supported high tariffs to protect American industry from foreign competition. However, if Congress were going to lower tariffs, the Republicans wanted to spend the federal surplus on pensions for disabled Civil War veterans. Cleveland vetoed hundreds of bills for veteran disability pensions. He thought they were fraudulent because some veterans applied for benefits they did not deserve. He was not unsympathetic about their suffering but thought only veterans wounded while serving their country should be given federal aid. Otherwise, local charities should provide relief for others. In one veto message he wrote:  

“Public money appropriated for pensions…of those who in the defense of the Union and the nation’s service have worthily suffered, and who in the day of their dependence resulting from such suffering are entitled to the benefactions of their government.”   

When the Texas Seed Bill passed Congress and came to his desk, Cleveland considered it in light of his belief in limited government and his constitutional duty as president. Furthermore, Cleveland thought the aid would weaken the “bonds of a common brotherhood” because he thought families, communities, and private charities in civil society and local or state government were best suited to help their fellow citizens. In his veto message, he wrote: 

“I can find no warrant for such an appropriation in the Constitution, and I do not believe that the power and duty of the general government ought to be extended to the relief of individual suffering which is in no manner properly related to the public service or benefit. A prevalent tendency to disregard the limited mission of this power and duty, I think be steadfastly resisted.”  

President Cleveland called on the other states to contribute their share of grain from the Department of Agriculture. This voluntary action, he believed, was a constitutional voluntary measure rather than direct aid from the national government, however modest.  

Cleveland’s veto of the Texas Seed Bill was an example of a constitutional debate over the role of government. Congress believed it had the power and a duty to relieve the suffering of citizens in Texas. On the other hand, President Cleveland vetoed the bill because of his belief in limited government, assessing the best level of government to provide relief, and encouraging charity through civil society instead of government. This question about the role of government would continue into the twentieth and twenty-first centuries.  

 

Dwight Eisenhower and The National Highway Act 

The United States experienced profound changes after World War II. The Cold War with the Soviet Union led to increased military spending, especially on nuclear weapons, and made national security issues a priority. Americans were increasingly living in suburban housing and commuting to work in cities. More Americans were purchasing cars in greater numbers and driving them. However, the states were primarily responsible for building roads for the increasing volume of cars, and the nation lacked a coordinated transportation system.  

President Dwight Eisenhower was a moderate conservative who had mixed thoughts about the government’s role. He was a “Modern Republican,” meaning that he believed in limited government, a balanced budget, and reduced government spending but also did not want to rollback New Deal programs. He believed that the government should expand Social Security and the minimum wage but not large, costly programs or government regulation. 

Eisenhower proposed a national highway system bill to Congress for its consideration. The legislation was popular because it promised to promote economic growth, employment, and better travel. However, several key representatives were concerned about the tens of billions of dollars in projected costs and the role of the government funding it. Congress rejected the bill in 1955.  

President Eisenhower had to compromise to build consensus for his bill and win congressional approval for what he considered an important priority. The compromise bill included a National Highway Trust Fund that would tax gasoline and truck tires that would pay for the interstate highway system. Therefore, the car and truck drivers would essentially pay to use the highway. The fund would be replenished continuously by the tax on users and provide money to build and maintain the highways. The states also had a role to play as they were responsible for 10 percent of the cost. 

Congress passed the National Defense Highway Act in a bipartisan manner that supported an energetic yet limited government role in a massive public-works program. It appropriated $27 billion for 41,000 miles of interstate highway. Eisenhower signed the bill into law in June 1956. The national interstate system benefited many different industries and promoted economic growth and promoted travel and tourism. The law was part of a constitutional discussion focused on the proper balance between the extent of the national government’s role and constitutional powers in supporting the common good in modern America. At times, the national government used the power of the highway funds to compel the states to act in a certain way such as the drinking age for minors that caused the balance to be upset.