Calhoun is rarely thought of as a monetary theorist, but his comments on monetary architecture and government spending are surprisingly relevant. Though nearly two centuries old, they hold a lesson about the politics of austerity today, as Republicans oppose needed federal investment in green technology and infrastructure, climate change mitigation, pandemic preparedness, affordable housing, equitable broadband access, and low-cost, high-quality education from pre-K to college. To realize these goals, which are both popular and urgently necessary, federal, state, and local governments will have to deploy the full scope of their fiscal and monetary capacities. We who support those goals can expect Republicans (and corporate Democrats) to blow a lot of smoke in our eyes, generating word cloud after word cloud dominated by “deficits,” “inflation,” and “pay-fors.” Calhoun can help clear the air. His ideas expose the conservative, hierarchical commitments that have always worked to thwart the promise of democratic governance.
Calhoun’s visage and evil brilliance lend themselves to storytelling. So does the irony of his political journey. Bursting onto the Washington scene in 1811, as a representative from South Carolina, Calhoun made a name for himself as a “nationalist” who believed in the vigorous use of the federal government to promote greater union and economic development among the states. President James Monroe soon appointed him secretary of war. The president’s Cabinet was much smaller then, and so Calhoun commanded a portfolio that ranged beyond defense. He had ambitious plans to turn the War Department into a huge government infrastructure agency, responsible for the construction of roads and canals throughout the country. At a time when winter rains turned American roads into impassable goop, and settlers west of the Appalachians threatened secession, few policies could be more important to national survival, he thought, than investment in infrastructure.
But though Calhoun was a nationalist, many of his Southern peers were not. The last thing they wanted was the federal government expanding its powers; it might then use those powers to undo slavery. North Carolina’s Nathaniel Macon spelled it all out in 1818, writing that “if Congress can make canals, they can with more propriety emancipate.” What did this mean exactly? Then, as now, there was a lot of debate about the extent of federal powers under the Constitution. Unlike today, however, the debate was still fresh and wide-open, and so the stakes were particularly high. Calhoun at this time was arguing for an expansive view that would allow his War Department to play a central role in the national economy. Macon was arguing that this was a slippery slope that would empower the North’s growing abolitionist movement. In the 1810s, Southern leaders remained split on these questions, but they were beginning to move toward Macon. In fact, Virginian James Madison had vetoed Calhoun’s earlier infrastructure bill, which Calhoun sponsored in his years in the House, to ensure the Constitution did not get interpreted too broadly.