Hamilton's Contribution To The Confederacy Era Debt
After the new Federal Constitution went into effect, those supporting it split between Thomas Jefferson and Alexander Hamilton. The ones who chose Hamilton, supported his economic plan. Hamilton’s plan for the nation included consolidating the state's’ debts under the federal government. He issued a report in which he proposed that the Federal government assume and fund all of the debts. He would then pay it by issuing new bonds at an interest rate of 4% payable over 20 years.
He spent much of his time writing Washington 's critical letters, and composed numerous reports on the strategic reform and restructuring of the Continental Army. Hamilton was not satisfied with a desk job so Washington soon promoted him to lieutenant colonel of the continental army(Sanders, Burns, Ades 63). In 1781 he begged for some action on the battlefield with Washington 's permission, Hamilton led a victorious charge against the British in the Battle of Yorktown. The English’s surrender during this battle lead to two major negotiations in 1783: the Treaty of Paris between the United States and Great Britain, and two treaties signed at Versailles between France and Britain and Spain.
Hamilton had a drawn out plan that Jefferson did not agree with, stating that assuming state debts
Why did Hamilton believe a national debt would strengthen the United States and help to ensure its survival? Hamilton’s financial plan was based off on a plan based off on public credit or redemption and assumption. Alexander Hamilton wanted to buy back all of the loans in full, which is called funding at par. He wanted to make public credit apparent by uniting all the state’s debt into one united national debt, which means that none of the states are now responsible for paying their own individual debts. In addition, his view was that with this public credit, he can get good credit which would secure nice loans with the Dutch and British financieres, which would strengthen the United States.
The topic I would be doing would be on/about Alexander Hamilton in regards to The Federalist Papers. This topic is significant, because it draws on the Founding Father whose writing influenced/shaped the composition of the Early American Republic, and has given rise to many institutions/developments that can be traced to this day. As quite a controversial and well-debated document, The Federalist Papers was designed as a series of essays used to defend the Constitution—upon which we still call upon today. The five sources that provide a basic foundation to begin the project are: “To Begin the World Anew” by Bernard Bailyn, “The Political Psychology of the Federalist” by Daniel Walker Howe, “Ethos in Law and History: Alexander Hamilton,
Thomas Jefferson and the other politicians who agreed with his views (Democratic-Republicans), were inclined to believe that the American Revolution was an act of pure rebellion, only unifying with the other colonies for a common goal of independence. Such a view, if strictly followed, would mean there would have been no reason for the colonies to stay unified, and this scenario would have surely been the end of an established powerful nation. Alexander Hamilton and the Federalists on the other hand, tended toward the view of advancing the current American experiment with a few sacrifices that would cause great turmoil amongst the states but ultimately unify them. One of these great sacrifices would be to establish a national bank in which state debt would become a total sum known as a national debt. His view was that unless each state felt indebted and/or dependent toward a federal government, that the union would eventually fall apart, and what made the United States powerful and capable of claiming their own independence would fade away.
I would have voted for Alexander Hamilton because from a young age you were able to tell that he was smart, well thought out, and extremely disciplined in every choice he made. And so when he entered the government this planning and knowledge of money and spends really helped to evolve the financial plan of the United States to what it is now. Without Alexander Hamilton`s ideas and aspirations of what the United States money system could do to support the country. You can also tell that with his history he cares about the people he would be affecting in his daily life. Alexander Hamilton was a Federalist.
President Washington appointed Alexander Hamilton as the Treasury Secretary, and Thomas Jefferson as the secretary of state. Within the government, two opposing views emerged as possible ways to improve the economic state of the country. Hamilton believed in strong federal government, hence, proposed that the federal government would assume the debts of the individual states, assume the Confederation’s debts at par, and establish a national bank. In contrast to Hamilton’s proposal, Jefferson felt that the states should hold bigger authority than the federal government, since the states were nearer to the people and were less likely to exploit their power. These two views emerged as the two political views, and eventually formed the basis
The topic of the night was the national debt crisis. Alexander Hamilton, a strong supporter of federal assumption, and James Madison, a loyal Virginian, were among the guests of this carefully calculated soiree. Personal motivations of wealth and power guided their conversations. Hamilton’s economic plan was devised to benefit the urban elite, who were, in his mind, the keystone of American economics. States like Virginia that had managed to pay off large amounts of their debt, now risked being charged more in new taxes under Hamilton’s plan.
All through his book Gordon explains how the debt has influenced and shaped the history of America economy. Hamilton wanted to reshape the American economy, thus he proposed the virtues of the national debt claiming that when it is limited it may be a national blessing. While providing the audience with a history of the American debt, Gordon aims at proving Hamilton 's beliefs. Indeed, the author wants to show that if the debt is used wisely, it may turn out to be a useful political and economic instrument. To support the assertion that the budget deficit is not necessarily evil, he includes different events of the American history.
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.
Hamilton wanted to create public credit with a treasury system, a national bank, a mint, and increase manufacturing which would help unify the country. On the other hand, there was Jefferson, who opposed a strong central government. He argued that the “wealthy would gain at the expense of ordinary Americans and that Hamilton’s political economy would corrupt the morality of citizens and undermine the social conditions essential to republican government”(Powerpoint). The country would opt for an approach closer to Hamilton’s views. One of the first acts was the National Banking Act.
Alexander Hamilton, the first Secretary of Treasury of the United States, had a lot going for himself being a man that came from poverty to success, and he was a man “all powerful and fails at nothing which he attempts” admitted a congressman in 1791 (Tindall and Shi). Born in the Caribbean in the West Indies, abandoned by his father and orphaned at the age of 13 by his late mother who had died. Later moved to New York, became a lawyer and transitioned to nationalism thus giving him the important role of handling the weight of the debt America had accumulated $54 million deep after the Revolutionary War (Digital History). Hamilton saw the need for some financial credit to be given to America and he had the right idea by proposing a National Bank to his first president George Washington. Word dispersed of that proposal leading a
Hamilton, similar to Washington, opposed perpetual debt and thought that it should only be used in times of immense need (Perpetual Debt). I feel that we have let down our founders, and are headed in a direction that will
If the government does not collect enough revenue that covers the expenses that was spent in the programs such as building, roads, military, bridges etc., the government have to accept debt. The revenue can be collected from the taxes and fees that government imposes. It plays a vital role in the country’s financial system as a government security. The sum of total outstanding borrowings owned by the federal government that includes the money borrowed by the government plus the interest it must have to pay on the borrowed money is known as national debt. If the government does not collect enough revenue that covers the expenses that was spent in the programs such as building, roads, military, bridges etc., the government have to accept debt.
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