Madison Vetoes Bonus Bill for Internal Improvements on Constitutional Grounds, Setting Precedent Against Federal Infrastructure

On the last day of his administration, President James Madison vetoes the Bonus Bill, legislation proposed by Representative John C. Calhoun to earmark the $1.5 million revenue “bonus” and future dividends (estimated at $650,000 annually) from the recently established Second Bank of the United States for a fund “for constructing roads and canals and improving the navigation of watercourses.” Despite approving of the bill’s stated goals and having privately urged that Congress be given power to build roads and canals at the Constitutional Convention, Madison vetoes the legislation as unconstitutional because he finds no expressed congressional power to fund roads and canals in Article I, Section 8 of the Constitution. The veto stuns Calhoun and Speaker Henry Clay, who had pushed the legislation forward in the waning days of Madison’s term and believed they had the president’s support.

Madison’s veto message explains that “the legislative powers vested in Congress are specified and enumerated in the eighth section of the first article of the Constitution, and it does not appear that the power proposed to be exercised by the bill is among the enumerated powers.” He argues that interpreting “the power to regulate commerce among the several States” to include constructing roads and canals would require “a latitude of construction departing from the ordinary import of the terms” and that such federal action would encroach upon matters delegated to state governments. When Calhoun and other Republican congressmen visit Madison on his penultimate day in office to say goodbye, Madison privately informs a dumbstruck Calhoun of his decision. Speaker Clay writes Madison begging him to at least leave the bill for his successor James Monroe, but Madison refuses.

Madison’s principled veto of the Bonus Bill sets a precedent that lasts for generations, effectively blocking major federal infrastructure investment and forcing states to finance internal improvements independently. The Erie Canal, for example, never receives federal funds and must be financed entirely by New York State. President James Monroe’s announced support for the bonus bill veto slows improvements legislation during the early part of his administration. The veto demonstrates how strict constitutional interpretation can serve as institutional obstruction to infrastructure development that might genuinely benefit national economic integration. While Madison’s constitutional scruples appear principled, the practical effect is to prevent the federal government from coordinating and financing the transportation infrastructure necessary for economic development, leaving such improvements to states with vastly different resources and capabilities. The precedent delays comprehensive federal highway development until the twentieth century, illustrating how constitutional doctrines can function as mechanisms for preventing collective action on national challenges—a dynamic recurring from Gilded Age court decisions blocking labor regulations through modern judicial obstruction of climate policy and voting rights protection.