Hamilton versus Wall Street

This is the beginning of the Introduction to Hamilton Versus Wall Street: INTRODUCTION The purpose of this book is simple: To establish once and for all that the First U.S. Treasury Secretary, Alexander Hamilton, was the founder of an American System of Economics, which provided the unique basis for building the United States into an industrial powerhouse. Since the popularity of the Hamilton musical has excited a surge of interest in this Founding Father, we now have a golden opportunity for making his true ideas broadly known for the first time since the mid-Nineteenth Century. That opportunity must not be squandered. This book is based on my 40 years of study of Hamilton’s ideas and policies on political economy, the science of building a thriving national economy. That study has led me to conclusions which clash with those of even some of the most pro-Hamilton voices in the country today. I have called for a public debate on Hamilton’s economics and their applicability to today, but that has yet to occur. It is my hope that this book will aid in provoking that debate, and the adoption of the Hamiltonian ideas so desperately needed in the United States, and worldwide. I originally intended this book to be a thorough scholarly treatment of Alexander Hamilton’s life and work. Over recent years I read Hamilton’s entire collected works with the aim of producing the definitive, in-depth evaluation of his thought. But that would be a years-long project, and the current opportunity must be seized. So instead, I will present a series of propositions dealing with the core principles Hamilton represents—principles which refute some of the most misleading assertions about his policies–and how they have shaped American and world history. I will start with one of the most dangerous lies of all—that Alexander Hamilton is the father of Wall Street and its financial premises and methods. I begin with a brief profile of Alexander Hamilton, the man. For a man’s ideas can never be totally separated from his character. A Revolutionary Genius Who was Alexander Hamilton? He was, first and foremost, a revolutionary visionary, who devoted nearly his entire life to creating a new kind of political-economic system uniquely suited to uplifting mankind. His legendary energy, his towering intellect, and even his super-sensitive attention to defending his honor were all vectored toward achieving that primary objective. As George Washington said of Hamilton in a letter to John Adams in 1798, "By some he is considered as an ambitious man, and therefore a dangerous one. That he is ambitious I shall readily grant, but it is of that laudable kind which prompts a man to excel in whatever he takes in hand." The experiences of Hamilton’s early life as an orphan on St. Croix taught him that he had to rely on his intellect to achieve his purposes in life. It also gave him invaluable experience in dealing with international commerce, a step toward seeing himself on the international stage. Fortunately, the individuals who befriended and protected him—from the Rev. Hugh Knox and his cousin Ann Lytton Venton , to the New Jersey revolutionary circles around Elias Boudinot --provided support for his voracious studies of history, philosophy, and economy, while bringing him to the American mainland. By 1774, when British oppression in Boston was leading to a revolt against London throughout the colonies, the young Alexander had chosen the revolutionary path, and put his pen to work on its behalf. The evidence for this is available in Hamilton’s extensive 1774 tract known as The Farmer Refuted, his second refutation of the attacks on the first Continental Congress by the Tory Rev. Samuel Seabury. This extraordinary document starts from first principles which I believe Hamilton never abandoned, both in terms of Natural Law and economy. The 17-year-old Hamilton, then still at King’s College (later Columbia University), already shows intimate familiarity with both English history and the philosophy of law, and he argues systematically from certain fundamental axioms. Among those are these two memorable assertions. The first is that the “supreme law of every society” is “its own happiness,” a view he contrasted with the Hobbesian (“might makes right”) view of Rev. Seabury. The second is more well-known: The sacred rights of mankind are not to be rummaged for among old parchments or musty records. They are written, as with a sunbeam, in the whole volume of human nature, by the Hand of the Divinity itself, and can never be erased or obscured by mortal power. Many have argued that, as a result of his experience with treachery among both his allies and his enemies, Hamilton abandoned this “idealistic” outlook. Certainly he did not have a pollyannish view of human nature; he believed that institutions had to be created which would channel men’s behavior for the good of society, rather than leaving it to individuals to exercise their individual rights without constraint. But Hamilton remained, despite all his disappointments, a religious man with a commitment to republicanism. In a letter to his friend Edward Carrington on May 26, 1792, Hamilton responded to charges that he was leading a party seeking monarchy thus: I am “affectionately tied to the Republican theory. I desire above all things to see the quality of political rights exclusive of all hereditary distinction firmly established by a practical demonstration of its being consistent with the order and happiness of society.” [emphasis in the original] I don’t believe Hamilton ever really abandoned his belief that mankind was imbued with God-given powers. His call for a Christian Constitutionalist Society in the 1800s buttresses my view. Indeed, Hamilton’s economic system depends upon the God-given inventive power of the human individual, for the creation of the technological advances upon which human scientific and moral progress depend. Hamilton is well-known to have shown no interest in personal wealth, and to have been generous to the poor and troubled. His stance against African slavery, and his actions for the education and emancipation of slaves and Native Americans, testify to his commitment to the belief that all men were created equal. Notably, although the 1783 Treaty of Paris called for the British to remunerate American slave-holders for their freed slaves, Hamilton told John Jay, who had negotiated the Treaty, that this plank could be ignored; it was immoral. He also argued that view publicly in his Camillus letters in defense of the Jay Treaty, which said nothing about the compensation issue. Hamilton hated oppression, British or otherwise. He believed in the triumph of reason and truth; just look at his masterful argument for truth as the standard in libel law in the Croswell case. He was willing to give his life to save the Union which he had helped to create as a bulwark against British or other European destruction of the fledgling United States—and he did. ...