Although under current Supreme Court doctrine the federal spending power is almost unlimited, it is not entirely unlimited. Hamilton, Story, and the Butler court all acknowledged that federal spending that does not serve the common defense or general welfare is unconstitutional. Justice Story explained it this way:
A power to lay taxes for the common defence and general welfare of the United States is not in common sense a general [i.e., unlimited] power. It is limited to those objects. It cannot constitutionally transcend them. If the defence proposed by a tax be not the common defence of the United States, if the welfare be not general, but special, or local, as contradistinguished from national, it is not within the scope of the Constitution. If the tax be not proposed for the common defence, or general welfare, but for other objects, wholly extraneous, (as for instance, for propagating Mahometanism among the Turks, or giving aids and subsidies to a foreign nation, to build palaces for its kings, or erect monuments to its heroes), it would be wholly indefensible upon constitutional principles.
Similarly, the Butler court acknowledged that the “general Welfare” phrase was “intended to limit and define the granted power to raise and to expend money” and that “the qualifying phrase must be given effect all advocates of broad construction admit.”
This induces us to recall the list of AID projects: Promoting DEI in Serbia and transgenderism in Peru both look a lot like “propagating Mahometanism among the Turks.”
Judicial Review of Non-General Welfare Spending
Among the American Founders, the prevalent view was that government was a fiduciary enterprise and should be held to fiduciary standards. In 2007, I undertook a research project to better understand what the Founders meant by fiduciary standards. The goal of the project was to reconstruct in broad outline fiduciary law as it stood in the late eighteenth century.
I submitted the resulting article for publication to student-edited journals. (It is an outrageous fact that law professors delegate the editing of almost all law journals to students.) One student editor was intrigued, but clearly thought the piece was insufficiently trendy. To induce acceptance, therefore, I had to add a slighting reference to a Republican congressional majority and propose a judicial test for distinguishing between legitimate federal expenditures and mere frivolity and graft.
The test finally seems useful, and I offer it here. It is similar to what legal scholars call “rational basis with bite.” That means, it is deferential to Congress without wholly dispensing with constitutional requirements. Further, it has the advantage of being similar to a standard applied in Founding-era fiduciary law.