Vol. 14 No. 3 (March 2004)
TO FORM A MORE PERFECT UNION: A NEW ECONOMIC INTERPRETATION
OF THE UNITED STATES CONSTITUTION, by Robert A. McGuire. Oxford: Oxford
University Press, 2003. Hardback.
416 pp. $24.95. £25.00.
ISBN: 0195139704.
Reviewed by Irwin L. Morris, Department of Government &
Politics, University of Maryland.
Email: imorris@gvpt.umd.edu
.
In 1913, Charles Beard published AN ECONOMIC INTERPRETATION
OF THE CONSTITUTION OF THE UNITED STATES OF AMERICA, the first substantial
development of the thesis that the content of the Constitution was primarily
attributable to the personal economic interests of the Founding fathers. It was, to say the least, a controversial
argument. In an especially
telling quote, "Nicholas Murray Butler (1939), the president of Columbia
University, where Beard held a professorship in 1913 declared: 'It is a
travesty to dignify so unscholarly an adventure by the title of an economic
interpretation of history'" (p.17).
Banned from a school library in Seattle, Beard's book drew the contempt
of none other than former President William Howard Taft. The popular response was, rather obviously,
quite negative. However, among
his academic contemporaries, Beard's "Marxist" or "socialist" analysis (as
it was referred to by some critics) received considerable support, and,
according to McGuire, "Beard's thesis eventually emerged as the standard
historical interpretation and remained so until the late 1950s" (p.17). By the late-1950s, however, Beard's thesis
had come under renewed attack, and by "the beginning of the cold war era
. . . the scholarly onslaught on Beard's interpretation had begun" (p.17).
In his new volume on the economic underpinnings of the
Founding, Robert A. McGuire resurrects-to some extent-the Beard thesis. Though the details of McGuire's "new"
economic interpretation of the Constitution vary a good deal from the details
of Beard's original economic interpretation, the thrust of both is the same:
the personal economic interests of the founders (and those of their
constituents) played a determinative role in the development of the Constitution. Using the tools of modern economic theory
(rational choice theory) and econometrics, McGuire develops a perspective
that ties personal and constituent economic interests to support for/opposition
to various aspects of the Constitution and support for/opposition to the
document as a whole. He then examines-in a relatively sophisticated manner-the extent
to which the implications of his theory are borne out in the data from the
Constitutional Convention and the various state ratification conventions.
The results are largely supportive of the new economic theory of
the Constitution.
To set the stage for his new economic theory of the Constitution,
McGuire provides an overview of the twentieth century historiography of
the Constitution, focusing on the post-1950 era in which Beard's analysis
came under such consistent attack. The general thrust of this literature review is that the "prevailing
interpretation" (p.15) of the Constitution is not economically-oriented
and is, in fact, antithetical to an economic interpretation.
Apparently, the conventional wisdom associated with the ratification
of the Constitution is similar; economics plays an insignificant role. In short, "[m]ost general discussions of the issue today argue
that the Constitution came about because of a consensus to improve the general
well-being of the country, not as a result of a conflict over economic interests"
(p.30). Although opposition
to the "prevailing interpretation" is not monolithic, McGuire considers
the proponents of an economic interpretation of the Constitution a very
small minority.
The overall structure of McGuire's empirical analysis is
straightforward. With data
on both the personal and constituent characteristics of nearly all of those
attending the Constitutional Convention, McGuire examines the relationship
between these characteristics and substantive aspects of the Constitution
(and the constitutional debates) from a number of perspectives. Basing his new economic theory of the
Constitution on a principal-agent model of representative behavior, McGuire
examines the extent to which the founders' votes were a function of their
principals' (constituents') economic
circumstances and ideological
orientations, and the extent to which their votes were a function of their
own economic circumstances and ideological orientations.
The structure of the multivariate analysis is such that McGuire explicitly
estimates the partial impact
of these economic and ideological factors on voting decisions. This is an important departure from a
literature based largely on an examination of total effects. So,
for example, a failure to understand that the founders often faced "conflicting
interests" could lead to spurious inferences. As McGuire argues:
Adoption of a particular
issue at Philadelphia, or of ratification, could have had a partial effect
on a founder with a specific interest such that the founder would have opposed
that issue, or ratification, if he took into account only that partial effect. Yet the founder might have actually voted
for the issue, or ratification, because the total of the partial effects
of all his other interests outweighed the negative partial effect of the
one specific interest (p.34).
McGuire's analysis of convention votes includes an examination
of the personal and constituent determinants of individual votes on more
than a dozen significant constitutional clauses-ranging from the prohibition
of trade embargoes to the role of the national government in the arming
and organization of state militias-and an evaluation of the determinants
of representatives' support for one of the foundations of the broader design
of the Constitution-nationalism.
Overall, McGuire finds at least some support for the contention
that each category of variables-personal economics and ideology, and constituent
economics and ideology-played some role in determining the voting patterns
of convention delegates. The
impact of economic interests (both personal and constituent) was sizable
on a number of important issues. For
example, slaveowners strongly opposed national export tariffs; merchants
opposed the two-thirds rule for enacting laws regulating trade; and delegates
with large private securities holdings opposed the ability of states to
issue paper money. State population
and slave holdings were significant constituency variables for a number
of specific clauses.
On the broader issue of nationalism, McGuire also finds a significant role for personal
and constituent economic interests and ideology, a blow to much of the literature
on constitutional economics. According
to McGuire, positive theories of constitutional economics presume that constitutional
decisions are made behind a "veil of uncertainty" (p.111), thus making it
impossible for delegates to know how their decisions will affect either
their own or their constituents' circumstances, so "partisan interests do
not matter for constitutional choice" (p.112). The results presented here suggest just
the opposite: "Both partisan personal interests and partisan constituent interests influenced voting on nationalism at the Philadelphia
convention" (p.127).
McGuire finds similar results, and thus draws similar conclusions, in his analysis of the votes in the state ratifying conventions. The evidence from the pooled analysis of the votes in the state conventions suggests that support for the constitution was enhanced by personal characteristics, such as lack of debt, ownership of public and/or private securities, and proximity of the delegate's home to navigable water. Farmers and merchants were more likely to support ratification; slaveowners were more likely to oppose it. There is also evidence that state population and, somewhat surprisingly state slave population are positively associated with support for ratification. These constituency results are not, however, robust across regions.
The state-by-state analysis-for the seven states in which
the vote was not unanimous and for which there are sufficient data-largely
affirms the findings generated by the pooled analysis. This is especially true for the "results
for commercial activities and [personal] slaveholdings" (p.205). One slight but important difference is
that the individual state analyses suggest that state-level slave holdings
were negatively associated with support for ratification (in contrast to
the pooled result). McGuire
makes a compelling case that the ratification results contrast with much
of the historiography of the ratification process, and he provides details
of these contrasts for several of the state conventions that have received
considerable attention. For
example, his ratification analysis contradicts the widely held position
that slaveowners were "more likely to have voted for ratification" or "that
no pattern in the vote related to slaveholdings existed" (p.197). Significantly, McGuire concludes that "had the men involved
in its ratification had substantially different economic, financial, or
personal interests, the Constitution certainly would not have been ratified,
at least not as it was written" (p.212).
McGuire makes an admittedly strong case for his new economic
theory of the Constitution and, indirectly, Beard's treatment of the Founding.
In the context of his literature review, his theory is a novel and
important departure from the historiography of the Founding.
McGuire could make a better case for the significance and novelty
of his perspective if his description of the historiography of the Founding
were not dominated by works that are now decades old. There is clearly greater support for some sort of economically-oriented
account of the Founding in more recent work, but the treatment of this newer
literature is relatively superficial. Along the same lines, much of the volume
is based on analyses which are extensions of McGuire's own published work-listed
in the Acknowledgements-some of which is a couple of decades old.
This new economic theory of the Constitution has clearly been around
for some time. Most readers would find a fuller treatment
of the most recent historiography, including responses to the new economic
theory, useful and informative.
The empirical analysis presented in the volume is quite
thorough, and McGuire's use of individual-level and state historical data
is ingenious. Nevertheless,
at times it can be redundant. For
example, Chapter 4, "Another Look at the Choice of Specific Clauses," adds
little of substance to the analysis presented in Chapter 3, "The Choice
of Specific Clauses in the Constitution."
By estimating the effects of personal interests and constituency
interests separately (instead of in a single model as in Chapter 3), McGuire
is able to incorporate more personal interest variables (e.g. number of
children and Scottish/Irish ancestry) and constituency interest variables
(e.g. distance to Philadelphia and Scottish/Irish ancestry in state).
Unfortunately, the separate models are-given the previous chapter's
findings-improperly specified (statistically and substantively significant
variables excluded) and, even if they were properly specified, the "new"
results add little to the argument.
In a book in which the appendices take up nearly 30% of the space,
this analysis could (should) have been dropped.
Finally, there are two nontrivial editorial points: one substantive, one statistical. One the substantive issue, McGuire uses
the term "partisan interests" somewhat cavalierly. For example, he attributes the following perspective to the
proponents of constitutional economics:
". . . a self-interested actor behaves differently during the constitutional
stage of collective decision making than during any other stage-partisan
interests do not influence the basic design of a constitution" (p.110).
The context of this passage suggests that he is referring to personal
interests and/or constituency interests with the term "partisan interests." But McGuire never argues that either the Federalists or the
Anti-Federalists had monolithic personal or constituency interests, so it
is difficult to see how partisan interests can be used as a synonym for
personal and constituency interests.
On the statistical point, the notation of significance levels in
the tables is inconsistent. Sometimes
significance levels are indicated, sometimes not. And the symbols used to indicate specific significance levels
change from table to table. It
is a relatively small issue, but it is irritating nonetheless.
As a reader who is not steeped in the historiography of
the Founding, I found this volume quite interesting and informative. It strikes me as odd that anyone would
argue that the delegates' (both those at the Constitutional convention and
the ratifying conventions) personal economic circumstances and the economic
circumstances of their constituents played no role in the deliberations,
the character of the final document, or its ratification. But, it appears that is just what a number of prominent scholars
did and do think. Given that,
this volume is a welcome addition to the literature on the Founding.
REFERENCES:
Beard, Charles. 1913. AN ECONOMIC INTERPRETATION OF THE CONSTITUTION OF THE UNITED STATES OF AMERICA. New York: Macmillan.
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Copyright 2004 by the author, Irwin L. Morris.