Afternoon Tea: “Magna Carta for the World? The Merchants’ Chapter and Foreign Capital in the Early American Republic”

This Article examines the early modern revival and subtle transformation in what is here called the merchants’ chapter of Magna Carta and then analyzes how lawyers, judges, and government officeholders invoked it in the new American federal courts and in debates over congressional power. In the U.S. Supreme Court in the early 1790s, a British creditor and an American State debated the meaning and applicability of the merchants’ chapter, which guaranteed two rights to foreign merchants: free entry and exit during peacetime, without being subjected to arbitrary taxes; and, in wartime, the promise that their persons and goods would not be harmed or confiscated, unless their own king attacked and confiscated English merchants. In other words, no harm to enemy aliens, except as retaliation. Tit for tat.

The idea that reciprocity was a fundamental mechanism of international (and interpersonal) relations became something like a social science axiom in the early modern Enlightenment. Edward Coke claimed to find that mechanism in the merchants’ chapter and publicized it to lawyers throughout the emerging British Empire and beyond. Montesquieu lauded the English for protecting foreign commerce in their fundamental law, and Blackstone basked in that praise. American lawyers derived their understanding of the merchants’ chapter from these sources and then, in the early Republic, stretched the principle behind it to protect foreign capital, not just resident merchants. The vindication of old imperial debt contracts would signal to all international creditors that, in the United States, credit was safe. Federalists then invoked the chapter outside of the courts to resist Republican attempts to embargo commerce and sequester foreign credit. For Republicans, doux commerce had become the Achilles heel of the great Atlantic empires: their reliance on American trade could be used to gain diplomatic leverage without risking war. For Federalists, economic sanctions threatened not just their fiscal policy but their entire vision of an Atlantic world that increasingly insulated international capital from national politics. They all agreed, however, that the role of foreign capital in the American constitutional system was a central issue for the new and developing nation.

This is from Daniel J. Hulsebosch, a historian at NYU’s law school. Here is the link.

Myths of Sovereignty and British Isolation XIX, Charters and Constitutions

The last post discussed the historical role of law. This post finally delivers the promise to discuss constitutions and charters. The sovereigntist Eurosceptic position in Britain standardly includes an elevation of Magna Carta into the greatest document ever in human liberty or, in more moderate versions of this position, certainly the greatest since it was issued in 1215 and the fount of all worthwhile liberties ever since: blessing Britain and countries which might be considered off shoots, like the USA, Canada, Australia and New Zealand (the ‘Anglosphere’), with a unique appreciation of liberty and parliamentary democracy.

While Magna Carta is of course a remarkable document and the moment it was issued was a remarkable historical moment, these claims are a distortion. It was a Latin document issued under duress during civil war conditions, the duress applied to the king by barons, at a time when the the English aristocracy and monarchy was distinguished from the great body of English by use of the French language and holdings in France.

Magna Carta has nothing to do with parliamentary democracy, it refers to a council of 25 which barons might form if they found the king to be misbehaving, and does not refer to a standing representative body but rather something more like a right of insurrection against a ‘tyrannical’ monarch. This has no more to do with parliamentary democracy than a variety of councils and assemblies existing across Europe at this time, and rather less than some.

Though Magna Carta is dressed up in the language of reasserting traditional rights, this does not make it the expression of a distinctly English or British love of rights based in tradition rather than innovation as the sovereigntists standardly claim. All demands for rights across Europe were expressed in that way at that time, and for centuries before and centuries after. The French Revolution itself started as a demand for ‘restoration’ of rights. The language of restoration is of course frequently a cover for innovation, an attempt to justify innovation by denying what it is.

Magna Carta was the innovatory product of political struggle, not the writing down of the unchanging liberties of old England. The same goes for the struggles for parliamentary power in the seventeenth century which frequently took on the deceptive form of ‘restoration’ of a Magna Carta which was already supposedly a restoration. It is even more fantastical to see the US Constitution as the outcome of Magna Carta, which does not stop many Anglosphere sovereigntist Eurosceptics doing so.

The history, or histories of liberty, is the accumulation of many interacting events, charters and theories in many countries. The growth of British parliamentary power took place in that context as did the US constitution and the Declarations of the Rights of Man and Citizen, which took place during the French Revolution. Like the French Declarations, Magna Carta exists in different versions so there is no pure origin text of liberty in either place. Rival French and Anglosphere attempts to proclaim the priority of either are particularly absurd. These are documents separated by hundreds of years and many other factors.

We cannot imagine modern liberty without either source, though both sources are flawed and open to challenge. The last thing thought and politics based on liberty needs is some sacred unchallengeable text as foundation, inevitably distorting understanding of the varied contexts and sources of liberty, and inevitably distorting our understanding of how ‘sacred’ documents had a source in power politics and political economy. There is no immaculate liberty born outside of struggles over power and appropriation of wealth.

The writing down of liberties in a legal document itself, particularly one that has a special, difficult-to-overturn foundational status, places some constraint on liberty, on how some people now and even more in the future might have some different ideas about liberty and see the earlier document as constraining.

It is certainly the case that a strongly entrenched document like the US Constitution deprives later generations of the liberty to re-imagine liberty and it is certainly the case that such a Constitution conflicts with the common law tradition exalted by British sovereigntist-Eurosceptics, according to which law progresses through the way judges build gradually on earlier cases to interpret statutes and formulate principles of justice.

Clearly a strongly entrenched Constitution with a Bill of Rights added does not come from common law, though it may try to capture some of the principles supposed to be widespread in common law, and must heavily constrain common law judges. The idea of a Constitution standing above politics, constraining it according to pure justice, has at least in the United States made the membership of the Supreme Court and its decisions a matter of constant political contention.

No attempt at a system of liberty can avoid tensions between different sources and understanding of liberty. Unfortunately the Eurosceptic-sovereigntist position largely tends to overlook this, or like someone looking at the Sun, cannot have it directly in its gaze without serious damage. The elevation of common law tradition, Magna Carta, and parliamentary democracy is the elevation of different things which in some sense must always be part of liberty, thinking of the general principles of judicial independence, institutional harmony, and representative government. However, as they conflict there can be no perfect version and no reason to think English, British or Anglosphere solutions can be regarded as above all others and with nothing to learn from the law-governed democracies of mainland Europe.

Next week, the end, a final summary.