The constitutional text

Article I · Section 10

Select any highlighted phrase to understand what it means.

No State shall enter into any Treaty, Alliance, or Confederation; grant Letters of Marque and Reprisal; coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts; pass any Bill of Attainder, ex post facto Law, or Law impairing the Obligation of Contracts, or grant any Title of Nobility.

No State shall, without the Consent of the Congress, lay any Imposts or Duties on Imports or Exports, except what may be absolutely necessary for executing it’s inspection Laws: and the net Produce of all Duties and Imposts, laid by any State on Imports or Exports, shall be for the Use of the Treasury of the United States; and all such Laws shall be subject to the Revision and Controul of the Congress.

No State shall, without the Consent of Congress, lay any Duty of Tonnage, keep Troops, or Ships of War in time of Peace, enter into any Agreement or Compact with another State, or with a foreign Power, or engage in War, unless actually invaded, or in such imminent Danger as will not admit of delay.

Source: National Constitution Center edition. Original wording is preserved; commentary explains historical and superseded provisions.

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Article I, Section 10, Clause 1d

No state bills of credit

Current text
emit Bills of Credit;

What it means

States may not emit bills of credit, a historical category of government-issued instruments intended to circulate as money on public credit. The term requires more precision than simply any state document promising payment.

Historical setting

Federalist 44 connected state paper-money experiments with concerns about unstable value and impaired private expectations. The prohibition addressed a prominent source of controversy in the Confederation period.

What it does

The rule does not abolish all lawful state borrowing or make every state bond a forbidden currency. Constitutional analysis distinguishes ordinary debt instruments from bills of credit within the provision’s meaning.

Debate & interpretation

The design aims to protect a common economic order against monetary experimentation imposed by individual states. It also reflects the difficulty of balancing debtor relief with the reliability of payment obligations.

A common misreading

A state bond is not automatically an unconstitutional bill of credit merely because it records a promise to repay money.

Think it through

What makes a financial instrument function as circulating money rather than an ordinary loan contract?

Follow the connection

Sources & further reading

Original Madison Center commentary. Explanations distinguish the text, historical context, and interpretive disagreements.

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