The Federalist 12:
Written by Alexander Hamilton
We’ve discussed how union would impact the economic prosperity of the states, now we’ll talk to revenue.
It is well acknowledged a strong economy is the most productive source of national wealth. The sometimes combative relationship between agriculture and commerce oer time has proven that their interests are interwoven. As economies flourish, land values rise.
The ability of a country to pay taxes must be in relation to the quantity of money in circulation and how fast it circulates. Commerce aids both these and benefits the treasury. Germany has some of the best gold and silver mines in Europe but has slender revenues due to lack of an active economy.
It is evident from the state of the country and its people that it is impractical to raise much money from taxation. Raising taxes and new methods of collection have been tried, but the public coffers remain empty.
Few will be surprised at this. In Britain, far greater taxes are indirect, such as on imports and excises. In America it’s evident we must depend on the same.
Union would aid the interests of commerce, would make collecting duties simpler and more efficient. It would aid revenue without hurting trade.
The geography of many states would make illegal trade easy, and if each state was separate people would easily evade each individual duty. This country will not have the rigorous protections against illegal trade the European nations have for years to come.
If however, we were one government, we have only one side to guard: the Atlantic coast. A few armed vessels may be all that’s required to enforce the law. The distance between foreign coasts and ours would make overnight contraband impractical.
It is evident that one national government would more easily extend duties on imports than separate states. Current duties are no more than three percent but could probably triple. Even just alcohol duties could furnish considerable revenue.
A nation cannot exist without revenue. Failing this, it must resign its independence and become another solvent state’s province. It is already being said that excises currently are not fiscally sufficient. It’s too hard to tax and trace personal wealth unless by taxes on consumption. The burden of revenue will be placed on landholders. We will not even have the consolation of a full treasury to atone for the oppression of farmers. Public and private distress will unite in deploring those groups who led to disunion.
The Federalist 13:
Written by Alexander Hamilton
If the states unite under a single federal government, there will be one national coffer to fund. If they split into several confederacies, there will as many coffers to fund. The separation into thirteen states is too extravagant and dangerous to have many supporters. Most men who are against the union are generally for three smaller confederacies. No well-informed man would imagine that such confederacies could as well regulated by governments less comprehensive than that of a larger federal government proposed by the Constitution. The economies of scale for these confederacies don’t work as well. Certain administrative functions require the same energy on small scales and larger scales; it’s better to have a unified government. Civil power, properly organized, can govern very large bodies of people and across an empire.
More probable than three confederacies, is that the states would naturally league into two governments.
It is evident that the thirteen states would support a national government rather than two or three governments—it’s just economical. It would get even worse once we add in the number of people who would be employed to facilitate between the confederacies, stop illicit trade, and more. Not to mention the militaries, as have already been discussed.
The Easy Federalist 
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