Fixed Navigation Bar

Wednesday, July 18, 2007

Alexander Hamilton

One of the major decisions George Washington made when he became the first president of the U.S. was to appoint Alexander Hamilton as Secretary of the Treasury. According to Joseph J. Ellis in His Excellency: George Washington, our first president quickly discovered that he had inherited a “messy mass of state, domestic and foreign debt.” The U.S. didn’t have a great credit rating at the time.

Hamilton, who had been Washington’s aide-de-camp, studied the ledgers for three months and then produced a 40,000-word document, Report on Public Credit that summarized the new nation’s financial problems and suggested solutions. The National Bank he proposed led to a long debate in Congress about federal vs. state powers.

In a 13,000-word rebuttal to Thomas Jefferson, James Madison and John Randolph, who argued the federal government didn’t have the constitutional power to set up a national bank, Hamilton reaffirmed an argument Madison had actually made three years earlier that “the necessary and proper” clause in the U.S. Constitution implied powers to the federal government beyond the explicit powers specified in the document.

Of course the tug-of-war between states and the federal government exists even to today, but Hamilton’s argument helped Washington justify what he probably wanted to do — put the country’s finances in the hands of the federal government.

For more on Hamilton, try these books:

Alexander Hamilton by Ron Chernow

Alexander Hamilton: A Life by Willard Randall

Alexander Hamilton, American by Richard Brookhiser

Hamilton’s Blessing: The Extraordinary Life and Times of Our National Debtby John Gordon

No comments: