Alexander Hamilton

by Charles A. Conant

Hamilton's quarrel with Washington, about which much has been written, came after nearly four years' service over a trivial delay in obeying a call from the General. Washington rebuked his aide for disrespect, to which Hamilton hotly retorted, "I am not conscious of it, sir; but since you have thought it, we part." Washington endeavored to prevent the execution of his project, but Hamilton would not be reconciled and returned to service in the line. He led his men with great impetuosity upon one of the British redoubts at Yorktown, and carried the position in ten minutes, with much more promptness than the French, to whom the other redoubt had been assigned.

While the war was still in progress Hamilton was looking ahead with the constructive genius which afterwards found such wide opportunities in the cabinet of Washington. He addressed a letter in 1780 to Duane, a member of Congress, in which he made a remarkable analysis of the defects of the Articles of Confederation, urged that Congress should be clothed with complete sovereignty, and made suggestions regarding its powers which were afterwards embodied to a large extent in the Constitution. He addressed an anonymous letter to Robert Morris early in the same year, treating of the financial affairs of the confederacy. He discussed carefully the paper currency and the causes of its depreciation, and proposed to restore soundness to the finances by gradual contraction of the volume of paper, a tax in kind, and a foreign loan, which was to form the basis of a national bank. When the clumsiness and helplessness of the system of government by committees was finally appreciated by the Continental Congress in 1781, and several executive departments were established, Hamilton was suggested by John Sullivan to Washington for head of the Treasury Department. Washington replied that "few of his age have a more general knowledge, and no one is more firmly engaged in the cause, or exceeds him in probity and sterling virtue." Robert Morris was chosen for the Treasury, but Hamilton opened a correspondence with him regarding the work of the department, which established a firm friendship between the older and younger man.

Hamilton desired the unification of the debt and the creation of a national bank, for the combined objects of cementing the Union and putting the finances of the country upon a stable basis. "A national debt," he wrote, "if it is not excessive, will be a national blessing, a powerful cement of union, a necessity for keeping up taxation, and a spur to industry." Whether all these benefits fall within the economic effects of a debt may well be doubted, but the second advantage assigned was undoubtedly one of the chief motives of Hamilton in recommending its creation. The Bank of North America was established by Morris upon a much more modest scale than was proposed by Hamilton. The younger man, looking to the future needs of the country and to the example of European banks, recommended an institution with a capital of ten or fifteen millions, with authority to establish branches, and with the sole right to issue paper currency equal to the amount of its capital. He contemplated a close relation between the bank and the government, and the taking up, under contract with the United States, of all the paper issues of the Continental Congress.

Hamilton made a connection while still under twenty-four which fixed his status as a citizen of New York, and proved of value to him in many ways. While on his mission to Gates at Albany, he met Miss Elizabeth Schuyler, daughter of General Philip Schuyler, one of the social as well as political leaders of the best element in New York. The acquaintance with Miss Schuyler was renewed in the spring of 1780 and ripened into an engagement, followed by their marriage on December 14 of that year. With the conclusion of the war, Hamilton was left with nothing but his title to arrears of pay in the army, and with a wife and child to support. He refused generous offers of assistance from his father-in-law, applied himself for four months to the study of the law, and in the summer of 1782 was admitted to the bar at Albany. While waiting for clients he continued his studies on financial and political questions and his vigorous arguments through the public prints for a strong federal union. He declined several offers of public place, but finally accepted an appointment from Robert Morris (June, 1782) as continental receiver of taxes for New York. This afforded him an opportunity of meeting the New York legislature, which had been summoned in extra session at Poughkeepsie, in July, to receive a report from a committee of Congress.

Congress in May, 1782, had taken into consideration the desperate condition of the finances of the country, and divided among four of its members the duty of explaining the common danger of the states. It was at the request of the delegation which went north that Governor Clinton called an extra session, and a communication was submitted on the necessity of providing for a vigorous prosecution of the war. Hamilton went to Poughkeepsie to aid his father-in-law, General Schuyler, and it was upon the motion of the latter that the Senate resolved itself into a committee of the whole on the state of the nation. Two days of deliberation were sufficient to produce a series of resolutions, probably drafted by Hamilton, which were unanimously adopted by the Senate and concurred in by the House.

These resolutions set forth that recent experience afforded "the strongest reason to apprehend from a continuance of the present constitution of the continental government a subversion of public credit" and danger to the safety and independence of the states. Turning to practical remedies, it was pointed out that the source of the public embarrassments was the want of sufficient power in Congress, particularly the power of providing a revenue. The legislature of New York, therefore, invited Congress "to recommend and each state to adopt the measure of assembling a general convention of the states especially authorized to revise and amend the confederation, reserving a right to the respective legislatures to ratify their determinations." These resolutions the government was requested to transmit to Congress and to the executives of the other states. Hamilton appeared before the legislature and discussed the subject of revenue, and one of the results of his manifest interest in the subject and his knowledge of finance was his selection by the legislature as one of the members of Congress from New York.

The impress of the organizing mind and far-sighted purposes of Hamilton was felt during his brief service in Congress. He took his seat from New York in November, 1782, and resigned in August, 1783. He cast his influence from the beginning in favor of a strong executive organization, and did his best to strengthen the heads of the recently created departments of finance and foreign affairs. He was of great service to Robert Morris, and almost carried the project of a general duty on importations, which was finally defeated by the obstinacy of Rhode Island. Such a measure, if carried out, would have afforded the central government a permanent revenue. It would have greatly mitigated the evils of the time, but would perhaps by that very fact have postponed the more complete union of the states which was to come under the Constitution of 1789. This was only one of the many projects germinating in the fertile mind of Hamilton. In a letter to Washington (March 17, 1783) he wrote:—

"We have made considerable progress in a plan to be recommended to the several states for funding all the public debts, including those of the army, which is certainly the only way to restore public credit and enable us to continue the war by borrowing abroad, if it should be necessary to continue it."

That it might be necessary to continue the war Hamilton seriously feared, in spite of the fact that the provisional treaty of peace with Great Britain was then before Congress. A grave question had arisen whether faith had been kept with France in the negotiation of this treaty. Congress had resolved unanimously (October 4, 1782) that "they will not enter into any discussion of overtures of pacification but in confidence and in concert with His Most Christian Majesty," the King of France. Adams and Jay, against the advice of Franklin, negotiated secretly with Great Britain, and only the moderation of Vergennes, French Minister of Foreign Affairs, prevented serious friction between the allies.