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Hamilton's inner circle benefited enormously

Hamilton's financial plan disproportionate benefitted the country's wealthy elite, many of whom were Hamilton's close friends and allies.

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Context

Alexander Hamilton’s economic plan benefitted his inner circle and the aristocratic class enormously. Its purpose, therefore, must have been to benefit the rich.

The Argument

Following Hamilton’s financial plan, the wealthy got richer and the poor saw only modest financial improvements. Members of Congress were able to purchase and build bigger and better houses. Those that complained, and there were many, were dismissed as ne’er do wells. [1] The manufacturing economy that he was creating was specifically designed to help the owning classes. Those that owned land and businesses would have a privileged position in the new economy. Those that did not have access to capital to start a business would be forced to work for those that did. [2] This was carefully calculated and deliberate. Hamilton was not interested in helping all Americans equally. He was interested in building an economy in which the rich reaped all the rewards while the poor toiled. His plan for the federal assumption of war debt saw his allies—including his mentor, financier Robert Morris—profit handsomely from their federal bonds. Much of the state's wartime debts, many of which consisted of letters to soldiers which they had sold at a fraction of the debt's value to speculators, had been snapped up by capitalists. Hamilton's insistence that the buyers of the debt be reimbursed, rather than Madison's insistence that the original owners of the debt be paid (i.e. the soldiers), reveals his real motives: to enrich his allies like Robert Morris. [3] Hamilton and his allies saw the American people as a source of enormous wealth for the upper class. In Morris’ own words, he wanted to “open the purses of the people”. He believed that by getting Americans accustomed to paying federal taxes, the federal government would be able to introduce a slew of new taxes on land and domestic products, which would enrich interstate investors. [4]

Counter arguments

Just because the wealthy benefitted from the plan, does not mean that the plan itself was designed to benefit the wealthy. Like John Adams, Hamilton believed that by increasing the wealth of the upper reaches of society, he would be also be increasing the lives of the ordinary people. This is essentially trickle-down economics. This is evident in the glowing writing of American's following the economic reforms. Noah Webster, writing in Connecticut in 1791 said: "Commerce revives and the country is full of provision. Manufacturers are increasing to a great degree and in the large towns vast improvements are making in pavements and buildings." [5] He knew that to build a prosperous society, he would need to leverage the greed and hunger of the upper classes. This is visible in his Federalist, No. 11. Hamilton described how the “unequalled spirit of enterprise… signalizes the genius of the American merchants and navigators and which is in itself an inexhaustible mine of national wealth.”[6] This is not the writing of a man out to enrich his allies and the rest of the Genting class, it is a man that identifies the need for entrepreneurs and the establishment of businesses to enrich the lowest classes. Additionally, just because the wealthy benefitted most from the plan does not mean that it did not put the country first. The most important issue Hamilton’s government faced was guaranteeing the future survival of the union. By keeping the support of the wealthy classes and encouraging their buy-in to the federal government, Hamilton believed that he was strengthening the union. While the average person may not have enjoyed the economic benefits of Hamilton’s financial plan, they benefitted enormously from the political stability it offered. When Thomas Jefferson entered the White House in 1801, he ordered his Secretary of the Treasury to meticulously examine treasury records to find evidence of Hamilton's corruption. But no documents were ever found that implicated Hamilton of any wrongdoing. If Hamilton was a man who was purely concerned with advancing the interests of his allies and inner circle, it is likely that he would have also engaged in corrupt activity. The fact that, even when examined with a fine-toothed comb, his actions are never once deemed corrupt would suggest that Hamilton was not a man that put himself or his allies ahead of his country. [7]

Premises

[P1] Hamilton's financial plan disproportionately benefitted the rich. [P2] This was deliberate and calculated. [P3] Therefore, the plan did not put the country first.

Rejecting the premises

[Rejecting P1] Trickle down economics dictates that as the rich become wealthier, so too do the masses. [Rejecting P2] In boosting the wealth of the upper-classes, Hamilton was attempting to improve the lives of the lower classes. [Rejecting P3] Therefore, his plan put the country first.

References

  1. https://www.jstor.org/stable/40640678?seq=3#metadata_info_tab_contents
  2. https://www.jstor.org/stable/1600815?seq=8#metadata_info_tab_contents
  3. https://www.press.uchicago.edu/Misc/Chicago/910687.html
  4. http://bostonreview.net/archives/BR32.6/hogeland.php
  5. https://www.press.uchicago.edu/Misc/Chicago/910687.html
  6. https://www.jstor.org/stable/1600815?seq=8#metadata_info_tab_contents
  7. https://www.iwp.edu/articles/2016/01/20/address-in-honor-of-alexander-hamilton-by-stephen-f-knott/

Proponents

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This page was last edited on Friday, 15 Nov 2019 at 16:38 UTC