Summary and Analysis
Section I: General Introduction:
Federalist No. 7 (Hamilton)
Summary
Other dangers would face a dismembered America. Territorial disputes, for one thing. Such disputes had always been "one of the most fertile sources of hostility among nations" and existed in the United States along its westward-moving frontier. There had been, and still were, "discordant and undecided claims" by various states to this ill-defined virgin territory. If the union were dissolved, this disputed territory would offer "an ample theatre for hostile pretensions, without any umpire or common judge to interpose between the contending parties."
Also, there would be trade rivalries. States less favorably situated would seek to overcome their disadvantages by moving to share the advantages of more fortunate neighbors. Each state, or separate confederacy, would set up a commercial policy peculiar to itself. The imposition of trade regulations, and efforts to enforce them, would lead to outrages, reprisals, and wars.
Another highly important matter was payment of the Union's public debt. That debt had to be paid if the nation was to maintain its credit at home and abroad. How to pay it would be a further cause of collision between separate states or confederacies.
How would the debt burden be apportioned? The question would arouse ill-humor and animosity. Some states would consider themselves too highly taxed and seek to lessen their burden. Other states would resist this because it would increase their taxes. Here Hamilton added a gem of social and political realism:
There is perhaps nothing more likely to disturb the tranquility of nations, than their being bound to mutual contributions for any common object, which does not yield an equal and coincident benefit. For it is an observation as true, as it is trite, that there is nothing men differ so readily about as the payment of money.
Analysis
Hamilton then pointed out other dangers that would face a dismembered union: territorial disputes, for one thing. A number of states had claims to parts of a vast tract of unsettled territory along the country's westward-moving frontier. There had already been trouble about this, even armed skirmishes. How could conflicting state claims be settled peaceably without a federal government which could act as "umpire or common judge to interpose between the contending parties"?
There was another matter of paramount importance: how to pay the public debt of the union? All states should contribute to paying off that debt, but how? and in what proportions? What power was to decide that question? Would some states resist, or evade? It was a very difficult problem, Hamilton admitted, for no one liked to lay out money.