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Alexander Hamilton's Financial Plan

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The United States was plagued with the economic instability following the American Revolution, so they devised multiple strategies to facilitate the situation. As well as deal with economic issues following the Revolutionary War with Great Britain, the US had to formulate methods to deal with all its foreign conflicts it had amassed. From 1787 to 1816, the United States initially struggled to deal with their economic debt due to taxation revolts by citizens who did not support the reforms, but was able to fix the issues through the use of Alexander Hamilton’s financial plan as well as deal with their foreign conflicts successfully through intelligent treaties. The United States attempts to solve their economic debts through taxation did …show more content…

Hamilton ensured that many of the holders of financial dept would be wealthy merchants, so that they had a financial stake in the new governments survival. This caused wealthy merchants to therefore become involved and want the government to be successful due to their financial stake in its future success. The establishment of a central bank was one of Hamilton’s reforms that allowed the American economy to stabilize and thereby establish its own currency . A bank gave the United States the opportunity to print their own currency, so that they would no longer be forced to utilize the British pound. This served as a solution to the United States identity issue, as it no longer identified itself with that of its oppressor’s currency. The bank also served as a collecting and distributing agent for the nation, making it a place of investment and opportunity. Such opportunities included the lending of money, holding of deposits, which therefore extended business and industry affairs . To fund state debts, the national government implemented a tax on Whiskey, which caused mass rebellion by farmers out west in …show more content…

The establishment of the Jay Treaty in 1794 led to the prevention of a war between the US and Britain, peaceful trade, as well as punishments for damages done towards US ships by Great Britain . The treaty, which was signed by George Washington, resolved mounting tensions between Great Britain and the US as well as stopped a war from erupting between the two countries. Washington took executive action and made sure that the treaty went through, because he would rather deal with his foreign affairs and be on good terms with other countries than have a long-standing conflict. The treaty gave the US great economic advantages by broadening trade access through diminishment of British ports and the establishment of commissions for ship damaged by the British. The Jay Treaty forced Great Britain to relinquish control of all its western U.S. forts and ports . With the British relinquishing control of these amenities, restrictions on American trade to both England and the Caribbean diminished, allowing for greater economic prosperity and foreign relations. Under the Jay Treaty, the British were forced to establish commissions to receive claims for ships damaged by Great Britain and its seizures. This form of compensation allowed for Great Britain to take responsibility for the damages they caused. These commissions also

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In the era of 1837, was the starting point for the new establishment for banks all over the United State. In the beginning, banks were in the center of importing and exporting and funding paper bills (Foner 365). The banks funded businesses and other industry to trade, buy or sell opening the pathways to overseas. Thus, to a wider range of people who flavored western goods and in return helped western prospered. However, without a proper regulation and restriction of issuing out bills put a downfall in the economy, unbalance system that cause the Panic of 1837 (Foner 366).

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In result, Hamilton's plan led to our modern National Bank today, it as well led to a clear distinction between Federalists and Democratic Republicans. Hamilton’s plan did fix the economy, while

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A publicly funded debt contributed to national government stability. Previously, the treasury must not deal with Confederacy Era debt, although Hamilton suggested Congress to redeem fifty-five million dollars to foreign banks, soldiers, and contractors. The Republican ideology regarding debt was that America must pay it off and that states are responsible for their own actions. However, Hamilton’s response to the debt was to fund it, rather than paying it all off. He believed that debt is good, which was a contrast to the Republican ideology.

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He introduced plans for the First Bank of the United States, established in 1791 which was designed to be the financial agent of the Treasury Department. The Bank served as a depository for public funds and assisted the Government in its financial transactions. The First Bank issued paper currency, used to pay taxes and debts owed to the Federal Government. Hamilton also introduced plans for a United States Mint. Though he wanted the Mint to be a structural part of the Treasury, he lost the battle to Jefferson and it was established in 1792 within the State Department.

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Between 1763 and 1775, there were three ‘Imperial Crises’ which occurred between the British and the American colonists. The conflict that was produced during this period arose through an undefined balance of political and economic power between the two parties. In 1763, Britain had just concluded the French and Indian war and was left with an immense and almost crippling debt of around 140 million pounds sterling (“Turning Point In American History”). In Britain’s eyes, the most effective way to reduce this debt was increased taxes. Unfortunately, the people of England were already massively overtaxed, which meant the last option for the British was to tax the American colonists.

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“Both Jefferson’s and Hamilton’s arguments were based on the Constitution’s Preamble, the “elastic clause” ( Article I, Section 8, clause 18), and Amendment X. The elastic clause gave Congress the right to make laws “necessary and proper” to carry out other powers given to Congress”.---source that explains how the central bank was a new idea for that time (maybe can write how there where many opposers such as James Madison)--- cerca di prenderla da un libro

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This established a modern, more unified banking system under a mixture of private and government control. The Federal Reserve System would allow members of banks to demand their reserves to draw in greater security, and made the currency and bank credit more adjustable. This made farmers furious because it was more difficult to get loans and then made the shipping and selling of crops more expensive. They wanted the seed to be lower so the could buy more and spend the same and have a silver based currency instead of the gold based. The Populists called for government ownership of railroads, arguing that they were too critical to be left in private hands.

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He successfully argued for the assumption of state debts by the federal government and the establishment of the first national bank – a private, but partially government-owned institution. He firmly established the principles of financial trading. Due to his efforts, the creditworthiness of the United States was restored. Hamilton’s accomplishments as Treasury Secretary were not achieved without a struggle. His congressional opponents tried to exhaust him by demanding detailed reports on the workings of the treasury department with incredibly short delivery dates.

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Alexander Hamilton throughout his life has had many noteworthy achievements. One of Hamilton’s most important achievement is that he created the first federal bank. This banking system allowed you to make bonds, loans, and more. This has been long lasting and very helpful to people for years and years to come. He also came up with the idea of a national currency or the money we use today.

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Hamilton 's monetary course of action for the nation included working up a national bank like that in England to keep up open credit; cementing the states ' commitments under the focal government; and initiating guarded tolls and government enrichments to empower American makes. These measures fortified the administration 's vitality to the hindrance of the states. Jefferson and his political accomplices limited these progressions. Francophile Jefferson expected that the Bank of the United States addressed an inordinate measure of English effect, and he battled that the Constitution did not give Congress the capacity to set up a bank. He didn 't assume that propelling produces was as basic as supporting the authoritatively settled agrarian base.

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While fighting the Revolution, the United States borrowed large sums of money from France, the Netherlands, and Spain to fund their struggle for independence. This debt totaled over 52 million dollars. The government believed that America had to reimburse those nations in order to gain their respect. Alexander Hamilton’s Financial Plan suggested various ways in which government could collect money from Americans so that they could pay back for the goods and services provided to the government during the war. Tariffs, taxes on imported goods that American’s had to pay, were put in place to raise funds.

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The need for a national bank was very much so necessary. Hamilton also convinced president Washington to sign the bank bill by his lengthy report that stated: “This criterion is the end, to which the measure relates as a mean. If the end be clearly comprehended withan any specified powers, collecting taxes and regulating the currency, and if the measure have an obvious relation to that end, and is not forbidden by any particular provision of the constitution, it may safely be deemed to come with the compass of national authority.”

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Tessa Nugent US History to 1877 Professor Gray 2/18/2018 Economic Genius After reading the Taking sides “The Hamiltonian Miracle” by John Steele Gordon. I have concluded that Alexander Hamilton is an economic genius of his time. According to John Steele Gordon, Hamilton’s knowledge of public finance helped him set a course for the American economy in a way that nobody else could.

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Another proposition he had, was to form a national bank; which would be known as the Bank of the United States. Hamilton based this idea off the Bank of England. This bank would be owned by the federal government and private investors. The purpose of the bank would be to use it as a financial and depository agent of the government. This would help the nation have a stable currency.

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The government created tariffs and taxes in order to financially secure the debt. At the time of Hamilton's plan to back foreign debt through taxes, Thomas Jefferson was also working to eliminate the national debt by paying it off. In 1794, an uprising called the Whiskey Rebellion resisted the higher taxes that would eliminate the national debt. While the government easily stopped this armed insurrection, it created a lasting legacy on the government’s ability to raise taxes and pay off the debt. Just as America was founded to avoid the high taxes that suppressed the citizens of England, the citizens of the new nation also resisted taxes created by the American government.

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