Rob Natelson’s essay, “The Constitutional Line on Direct Taxes,” concludes that the Supreme Court’s decisions involving direct and indirect taxes have been “conflicting, uncertain—and wrong.” Those decisions may have been conflicting and uncertain, but whether they are wrong is a more complicated question.

　　He urges us to do a deep dive into “eighteenth-century tax vocabulary and … contemporaneous tax laws” to identify a clear and consistent understanding of these terms. Joel Alicea and I did just that a few years ago, and we focused on the carriage tax upheld in the landmark 1796 Hylton case. This was the Court’s first exercise of judicial review, and it is well worth reading, not least because we discovered that “the case was trumped up, the facts were bogus, the procedure was defective, and the Court lacked a quorum.”

　　We also learned that the framers actually had very different views of the meaning of indirect and direct taxes, especially as related to personal property. That is the main reason why prominent founders came down on opposite sides of the question in Hylton. The issue even split two of the Federalist authors. Alexander Hamilton argued that the carriage tax law was constitutional over Madison’s strenuous objections.

　　The constitutional conflict arose because many people did not realize that the key words, such as the constitutional term “excise,” had different meanings in different parts of the country. In Congress, when Madison called the tax on carriage ownership an unconstitutional direct tax, Fisher Ames from Massachusetts responded, “It was not to be wondered at if he, coming from so different a part of the country, should have a different idea of this tax.”For those living in his state, “this tax had been long known; and there it was called an excise.”

　　If we believe that the original understanding or the framers’ intentions (or both) are important parts of constitutional interpretation, we need to be especially thoughtful about what we really know about that history.

　　The fact that the key terms had multiple meanings led Justice Paterson to write in his opinion that “the natural and common, or technical and appropriate, meaning of the words, duty and excise, is not easy to ascertain.” He concluded that the semantic argument, based on appeals to conflicting uses of the terms in dictionaries, treatises, and American and British tax laws, “turns in a circle.”

　　Because “different persons will annex different significations to the terms,” Paterson turned to “the intention” of the Framers, which was “that Congress should possess full power over every species of taxable property, except exports.” He continued, “The principal, I will not say, the only, objects, that the framers … contemplated as falling within the rule of apportionment, were a capitation tax and a tax on land.”

　　Why was that the Framers’ understanding? Here, Justice Paterson disagrees with Natelson, who says, “Tradition … not slavery, was the origin of the Constitution’s requirement that direct taxes be apportioned.” Paterson, who had been a delegate to the Constitutional Convention, continued, “The provision was made in favor of the southern States,” which “possessed a large number of slaves; [and] had extensive tracts of territory, thinly settled, and not very productive.” Those states were worried that “Congress … might tax slaves … and land in every part of the Union after the same rate or measure,” thus disproportionately burdening the South.

　　If the justices needed a reminder of the importance of this provision to the South, Hylton’s lawyer concluded his brief with a warning of the potential for civil war. He wrote, “the danger of allowing a majority of Congress, to be unencumbered with constitutional restrictions” will lead to oppression, and “if oppressed, states will combine—the grand divisions of northern and southern will retaliate, as majorities or minorities fluctuate—and a retaliation between nations, invariably ends in a catastrophe.”

　　Since Prof. Natelson is concerned that too much of the literature on this subject has been “agenda-driven,” please note that I think a wealth tax is a terrible idea, and I am not writing to argue in favor of its constitutionality. But the historical record is both more interesting and more complex than it first appears. If we believe that the original understanding or the framers’ intentions (or both) are important parts of constitutional interpretation, we need to be especially thoughtful about what we really know about that history.

　　In this case, what we know is that an objective analysis of the meaning of the key terms points in multiple directions. To decide which is the right direction, we need a good reason for choosing one over the other without just favoring our own political preferences. Justice Paterson offers an excellent model. He did not like the Convention’s approach, which he called an “unfortunate compromise.” But, instead of being agenda-driven, he followed what Blackstone taught the founders, which was that his judicial duty was “to interpret the will of the legislator … by exploring [its] intentions at the time when the law was made.”