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The Great National Bank Debate Between Thomas Jefferson And Alexander Hamilton

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The Great National Bank Debate was an argument between Thomas Jefferson and Alexander Hamilton about if a national bank should be established for the U.S. This would be decided by George Washington. Alexander Hamilton thought the national bank would be great for U.S. trade and it would give a central place for financial actions. This bank would be the biggest financial corporation, bigger than any other nation (Hill) But, Thomas Jefferson thought the opposite and believed that a national bank would only cause problems for the future of the U.S. Washington should approve Thomas Jefferson's proposal of no national bank because it would give the U.S too strong of a central government, would benefit and grow the upper class and financially corrupt …show more content…

This included the idea of a single currency and having that throughout the U.S. as a way to make things simpler and more efficient (Digital History). This was something Jefferson did agree with saying “It may be said that a bank, whose bills would have a currency all over the states, would be more convenient than one whose currency is limited to a single state (Thomas Jefferson-University of Virginia Press).'' The only problem that Jefferson had with this was that banks would also control people's loans and control their credit. Jefferson thought this would only cause financial corruption throughout the U.S. He felt this would only undermine the state banks that were in order and create a “financial monopoly” only benefiting foreign interests and the wealthy. And, if the National Bank was ever to go into debt after paying off the U.S’s debt then taxes/prices would go up. Which they were legally able to do under the Constitution. As mentioned above rules for this bank were not set and are strict so things like this were legally able to take place. Jefferson angrily said “The power to create corporations had to be explicitly authorized and was not something that could be created by “implication” from the text of the Constitution (Bill of Rights Institute).” Financial corruption as Jefferson implied would only not benefit the people in the U.S. And, would be caused by the U.S. ability to take the money and spend, give out huge loans to wealthy businesses, and the ability to tax and raise

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Being charted for 20 years, it started in Philadelphia with a capital of ten million dollars. I think Hamilton’s plan of a national bank was successful because it helped to stimulate the nation’s economy like it was planned to. It also gave the new nation a good foundation financially. It also was successful because it created a new united currency that was the same throughout the whole Union. When the stock was put up for sale publicly, it was sold out in less than two hours, which also expresses the successfulness of Hamilton’s idea of a national bank even though many people like Thomas Jefferson thought it was

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“Experience hath shewn, that even under the best forms of government, those entrusted with power have, in time, and by slow operations, perverted it into tyranny,” said Thomas Jefferson, who believed in strict constitutional interpretation, a simple republican society, and the opposition of a powerful, centralized government. Opposed to Hamiltonian visions such as an industrialized nation, a powerful centralized government, the U.S Bank, high tariffs, and an approbation towards the white collar or upper class, Jefferson proposed ideals of agrarianism, a weak centralized government allowing more power to the individual, a miniscule standing army, and an approbation towards the blue collar or working class. Though Jefferson proposed many of these ideas, he was not able to act on many of them throughout his presidency. Due to certain circumstances dealing with war, the Embargo Act, and other urgencies during his presidency, Jefferson was forced into leading a more powerful, centralized government, contesting with his original hopes for the nation.

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Hamilton's economic plan turning point was on the promotion of manufacturers and commerce. While Hamilton distrusted popular will and believed that the federal government should use considerable power in order to steer a successful course, Jefferson placed his trust in the people as governors (Holmes). Hamilton's plan was to establish a bank like the one in England to maintain public credit; strengthening the states' debts under the federal government, and enacting protective tariffs and governments subsidies to encourage American manufactures. All these measures strengthened the federal governments power at the expense of the states. Jefferson opposed these views from Hamilton he feared that the Bank of the United States represented too much English influence, and argued that the constitution did not give congress the power to establish a bank.

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Both Alexander Hamilton and Thomas Jefferson had different opinions on how the First National Bank of The United States should be set up and if it goes by what is stated in the Constitution, which led to an argument between federalist and antifederalist in 1791. Federalist, Alexander Hamilton, was a strong believer in the development of a strong central government and broad a interpretation of the Constitution. On the other hand anti-federalist, Thomas Jefferson, was convinced that the government should have to undergo a strict interpretation of the Constitution and that the government shouldn't interfere, more than needed to, in the lives of the American people. Hamilton recommended that the government should in fact make the Bank of the

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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.

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However, the Louisiana Purchase created an additional 15 million dollars to the US National Debt, and this debt was one that the United States could not afford. To fix the problem of the National Debt, Jefferson, who had previously said in Document C that “The incorporation of a bank, and the powers assumed by this bill, have not, in my opinion, been delegated to the United States, by the Constitution”, used Alexander Hamilton’s idea of using the National Bank to pay of the debt. Jefferson, going against the very opinion he stated of the National Bank not being Constitutional, used the National Bank to pay off most of the debt, which went against Republican belief on the lessening of taxes the people and also the prevention of a creation of a National Bank. In Document J, Jefferson asks permission from congress to send an expedition group to explore the Louisiana territory that he bought extra-constitutionally. Congress now had no choice but to deal with a matter that they had no decision in prior to it.

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The creation of the first bank in the United States prompted a political debate which started in 1791, and went on in the following years. Hamilton’s plan foresaw a bank provided with special powers and privileges, which gave birth to a wide opposition. Although Hamilton 's idea continues to exist in today’s economic environment, at that time his proposal was met with widespread resistance from individuals such as James Madison and Thomas Jefferson, who considered the creation of a federal bank as unconstitutional. Following to a broad interpretation of the Constitution, Hamilton argued that in order to have an effective bank, Congress should be provided with all the powers required. Jefferson disagreed with Hamilton, and claimed that the establishment of such a bank was not consistent with the powers that the Constitution granted to Congress.

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Alexander Hamilton, a late 18th-century politician, was a major supporter of the National Bank. The National Bank is a bank that facilitates daily transactions and collects tax revenue for the federal government. In the 1790s, there were two distinct sides to this debate: the Hamiltonians and the Jeffersonians. The Hamiltonians, in alignment with Hamilton’s beliefs, believed in a looser interpretation of the Constitution, while the Jeffersonians believed the opposite, in alignment with Thomas Jefferson’s beliefs. Ultimately, this debate ended in 1819 when the Supreme Court ruled the National Bank constitutional in the McCulloch v Maryland case.

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Hamilton and Federalists argued against Jefferson and Democratic-Republicans on the topic of the national bank by questioning the meaning of the word necessary. Hamilton supported the loose interpretation of the Constitution and claimed that since the bank would significantly improve the economy, it would progress public good, thus making it necessary. The Elastic Clause supported Hamilton’s interpretation because it allowed Congress to pass any laws necessary (Doc D). The decision to install a national bank created a lot of angry Democratic-Republicans and further damaged national unity. Although he argues against it, when Jefferson took over as president he allowed the charter to run out.

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Hamilton interpreted it loosely while Jefferson was strict. This led to an argument about whether the creation of a national bank was constitutional; Hamilton stated it was while Jefferson claimed it wasn’t. Another issue that they clashed

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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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Alexander Hamilton wanted to create a national bank to pool all of the country’s debt together. This would be beneficial because the bank would be able to collect taxes, create one currency, and make loans. This grew into a problem because a national bank was not mentioned in the Constitution. Thomas Jefferson especially opposed the National Bank, and made a statement that declared “It [gave it] the sole exclusive right of banking under the National authority … [was] against the laws of monopoly … to [grant it] a power to make laws [superior] to laws of states … [is wrong]” (Document 2). It started to become controversial because many people interpreted the Constitution differently.

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Alexander Hamilton was one of the major promoters and supporters of this revolution. He wanted a way to repay debts and attract investors and he wanted to do this by establishing a Bank of The United States. It had a limited charter and worked with some state and commercial banks. This new system encouraged manufacturing, allowed the government to restore its credit, and gave it the ability to obtain large loans during war. It is only able to do this by monitoring the amount of money in circulation.

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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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Jefferson and the Democratic-Republicans were strict constructionists who believed that if the Constitution didn’t allow something, it was forbidden. Hamilton and the Federalists were loose constructionists who believed that if the Constitution didn’t forbid it, it was allowed. He explained his loose constructionist views in “Hamilton’s Opinion as to the Constitutionality of the Bank of the United States,” saying, “If the end is clearly found within any of the specific powers, and if the law has an obvious relation to the end, and it is not forbidden by any particular provision of the Constitution, it may safely be deemed to come within the compass of the national authority.” The National Bank held money for the nation, funded the government, and put private and public money together for a capital pool. Hamilton liked the National Bank because it loaned money to

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