Alexander Hamilton

h began in December, 1790, witnessed the presentation of his report in favor of a national bank. This report, like that on the debt, showed careful study of the subject i

rgencies." It would also facilitate the payment of taxes, by enabling tax-payers to borrow from the bank and by the aid which it would give in the transfer of funds. He did not shrink from declaring that the country would benefit if foreigners invested in the ban

uantity which will only satisfy, or which will surcharge the circulation: in the last, that standard results from the demand. If more should be issued than is necessary, it will return upon the bank. Its emissions, as elsewhere intimated, must a

ring its continuance. The capital of the bank was not to exceed $10,000,000, for which the President of the United States might subscribe $2,000,000 on be

ent. The effect was much the same as the creation of the Bank of England by the loan of its capital to the government, which bound the moneyed classes firmly to King William, through the knowledge that the debt and the solvency of the bank depended on the perpetuation of his government and the exclusion of the Stuart Pretender. The tendency

onstitution did not anywhere grant in terms to the government the power to establish a national bank. Even Hamilton did not pretend to put his finger on the specific authority for his new project. He advanced a doctrine which was eagerly embraced by the party which was growing up around him, but which was as resolutely opposed by the other party. This was the doctrine of the implied powers granted to the new government by the Constitution. It is doubtful whether t

strictly limited to those enumerated in the Constitution. The doctrine of Hamilton, from this point of view, was revolutionary. It meant the conversion of a government holding limited delegations of power from the people and the states into a government having supreme power, capable of taking an infinite variety of measures whenever Congress, in the exercise of its discretion, believed

in the two houses, and was somewhat impressed by the weight of the argument against the constitutional power of Congress to establish the bank. The cabinet was divided. Jefferson and Randolph were against the constitutionality of the bill. Hamilton and Knox were in favor of it. Washington asked each of them to give him in writing the reasons for his opinion. He weighed them carefully and then affixed his

s an unexampled proof of the resources of our countrymen and their confidence in public measures. On the first day of opening the subscription, the whole number of shares (twenty thousand)

of discount and deposit in all the states and to distribute parts of its capital among eight branches in the chief cities of the country. It was the drafts of these branches upon each other, and their means for reducing to a uniform and reasonable rate the cost of transferring funds, which contributed to knit all parts of the country together in commercial matte

the able men who have presided over the national finances. Gallatin made a strong report in 1809, recommending that the charter of the bank be renewed upon its expiration in 1811, with an increase of capital and wider powers. A new charter was voted in the House, but the bill was not acted on in the Senate, and before th

wers of the general government. The jealousy of the state banks had led the State of Maryland to impose a discriminating tax on the Bank of the United States. If the right to levy such a tax had been admitted, the Bank would have been completely at the mercy of the states, and one of the chief purpose

execution the foregoing powers, and all other powers vested by this Constitution in the government of the United States or in any department or officer thereof." Marshall, in the series of great decisions by which he strengthened the power of the Union, often made use of these provisions to justify his reasoning. In one of the most famous of these decisions (McCulloch vs. Maryland), he sustained the constitution

possible the decisions of Marshall. If the question of the right to incorporate a bank could have been brought before the court at the beginning, before the institution had proved its value, and if men like Jefferson and Madison had been upon the bench, there is at least room for doubt whether a decision would have been

ost advisable, as has been observed, not to attach the unit exclusively to either of the metals; because this cannot be done effectually, without destroying the office and character of one of them as money, and reducing it to the situation of a mere merchandise." He believed, however, that care should be taken to regulate the proportion b

fficient than under modern conditions, and the cost was much greater. Hamilton endeavored to find the true commercial relation between gold and silver as a basis for the coinage values, in the hope that this would not change sufficiently to upset a bimetallic system founded upon such a basis. He wa

veloped country. Hamilton strongly favored the diversification of the industries of the country between agriculture and various forms of manufacture, because he believed it would contribute to the solidity of the industrial system and to the financial independence of the United States. His conception of the best method for promoting American industries differed materially, however, from more recent de

any foreign manufactured articles to put it upon the highroad to industrial development, and it was at a much later period that the manufacturing interests acquired the power which enabled them to increase the scale of duties. When this time came, they turned to the arsenal of Hamilto

. What can be said of Hamilton without reasonable ground of denial is that he did not recommend in any of his writings the high scale of duties advocated by some protectionists in recent years. On the contrary, he urged a scale of duties which would be treated by the protectionist of to-day as below even the level of a "tariff for revenue only." That his ideas were far from extreme is indicated by the project which he drew up in 1794 for a

whiskey was more extensively carried on than in any other part of the Union. The federal collector for Washington and Allegheny was tarred and feathered, and deputy marshals did not dare serve writs against those guilty of the outrage. Washington's journey through the South had a good effect in softening the opposition to the law, which first showed itself in Virginia and North Carolina; but in Pennsylvania conditions went from bad to worse, until it

ashington showed no hesitation in supporting the authority of the federal government. He obtained a certificate from a judge of the Supreme Court, setting forth that the laws of the United States were set at naught and that the courts were unable to e

e made by the government overawed the insurgents and finally compelled their submission. Albert Gallatin, although a citizen of the disaffected section and an opponent of the party in power, exerted his influence on behalf of order. Negotiations were set on foot between commissioners of the President, and a committee of citizens, of which Gallatin was a member. When this committee met to decide whether they would recommend compliance with the law

ther and the people split into warring factions when men were called upon to march in arms against their fellow-citizens. The event proved that the new government had vindicated its right to exist, and that the sentiment of union was daily gaining a stronger hold upon the hearts of the people. That this new power had not only built up a cohesive financial system, but had shown its c

t until he felt that his constructive work was complete. It was with conscious satisfaction that in his report on the public credit at the beginning of 1795 he was able to marshal the measures already taken towards restoring order to the national finances and point out their results. The credit of the country had been raised from the lowest abyss of dishonor to that of the most enlightened nations of the old world; an adequate system of taxation had been provided for meeting the