It was fortunate for the state and the country that the leader of the opposition to the Constitution in the New York convention was a man of a high order of ability, whose mind was open in an unusual degree to the influence of logical reasoning. This man was Melancthon Smith, who is accorded by Chancellor Kent, the great authority on American law, the credit of being noted "for his love of reading, tenacious memory, powerful intellect, and for the metaphysical and logical discussions of which he was a master." It is as much to his credit as that of Hamilton that he finally admitted that he had been convinced by Hamilton, and that he should vote for the Constitution. This result was only reached, however, after a long and sometimes acrimonious struggle, in which Hamilton was on his feet day after day explaining and defending each separate clause of the Constitution,—not only in its real meaning, but against all the distorted constructions put upon it by the most acute and jealous of critics.
But events had been fighting with Hamilton. State after state had ratified the new document, and news of their action had reached New York. Nine states, the number necessary to put the Constitution in force, were made up by the ratification of New Hampshire (June 21, 1788). Still New York hesitated, and Hamilton wrote to Madison: "Our chance of success depends upon you. Symptoms of relaxation in some of the leaders authorize a gleam of hope if you do well, but certainly I think not otherwise." Virginia justified his hopes by a majority of 89 against 79 for ratification (June 25, 1788). The news reached New York on July 3. The opposition there, though showing signs of relenting, was still stubborn. Conditional ratification, with a long string of amendments, was first proposed. Jay firmly insisted that the word "conditional" must be erased. Finally, on July 11, he proposed unconditional ratification. Melancthon Smith then proposed ratification with the right to withdraw if the amendments should not be accepted. Hamilton exposed the folly of such a project in a brilliant speech, which led Smith to admit that conditional ratification was an absurdity. Other similar proposals were brought forward, but they were evidently equivalent to rejection by indirection, which would have left New York out of the new Union.
Finally, Samuel Jones, another broad-minded member of the opposition, proposed ratification without conditions, but "in full confidence" that Congress would adopt all needed amendments. With the support of Smith, this form of ratification was carried by the slender majority of three votes (July 26, 1788). By this narrow margin it was decided that New York should form a part of the Union, and that the great experiment in representative government should not begin with the two halves of the country separated by a hostile power, commanding the greatest seaport of the colonies.
Hamilton thus played an important part in winning the first great battle for the Constitution. Ratification was only one of many steps which remained to be taken before the new government was in working order. Hamilton hurried back to the Federal Congress, and carried an ordinance fixing the dates and the place for putting the new government in operation. When he returned to New York, he was beaten for reëlection to Congress, and Governor Clinton and his party retained such a firm grip upon the legislature that a deadlock occurred between the Federalist House and the opposition Senate. New York was unrepresented in the first electoral college, and had no senators at the meeting of the First Congress. The state elections which followed resulted in defeat for the Federalists in the election of the governor, but they carried the legislature and elected two senators,—General Schuyler and Rufus King. King had recently come from Massachusetts, and Hamilton's insistence that he should be chosen caused a breach with the Livingstons, which contributed to the defeat of Schuyler two years later and the election of Aaron Burr. Hamilton's course in this matter was one of many cases in which he showed that he was not an astute politician, nor an adept at dealing with men. His highest qualities were those more distinctly intellectual, which led him to drive straight towards a desired object, with little patience for smaller men or the obstacles which stood in his way.
[III]
ESTABLISHING THE PUBLIC CREDIT
The great work of Hamilton, which was to stamp his name forever upon American history and our frame of government, was yet before him. Washington was inaugurated in April, 1789, but it was not until September 2 that an act passed Congress establishing the Treasury Department. Hamilton was the selection of Washington for the new post. It was a selection so well approved by all who were familiar with Hamilton's great abilities as an organizer and financier that the nomination was confirmed on the day that it reached the Senate. The studies of many years, the programme which had been outlined in letters to Morris and in the newspapers, were now to bear fruit under the directing genius of Hamilton. Only ten days passed after his appointment before Congress requested him to prepare a report upon the public credit. Then came calls for reports on the collection and management of the revenue; estimates of receipts and expenditures; the regulation of the currency; the navigation laws; the post-office, and the public lands. Money had to be found at once for the pressing needs of the new government before the more elaborate projects of the young minister of finance could be put in operation. But Hamilton did not delay long even for the more important and permanent work. When Congress met in January, he submitted his celebrated report "On Public Credit," which laid the corner-stone of American finance under the Constitution.
This report of Hamilton's on the public credit has long stood out as one of the master state papers of American history. Read to-day in the light of the economic progress of more than a century, its conclusions are not entirely novel, but are in the main clear and sound. To obtain a proper perspective regarding their value, the mind should be projected back to the beginning of 1790, when political economy as a science had barely been born, and the work of Adam Smith, although about fourteen years old, was probably known to but few in America. Many public men of to-day with the proper preliminary training might evolve as sound a report as that of Hamilton, but no ordinary man could have done it a hundred and ten years ago, and few men could do it to-day with the force of diction, precision and directness of statement, the grasp of principles, and the mastery of detail which marked the work of Hamilton.
He seemed to gather in his hands all the tangled threads of the disordered finances of the Continental Congress and of the states and show how they could be woven into a band of strength and symmetry, holding together by the motive of enlightened self-interest all the parts of the new Union. He proposed to plant the public credit upon a firm foundation, satisfy the public creditors, and put the nation on the high road to industrial and financial progress. The difficulties which Hamilton confronted were not merely a bankrupt Treasury and a loose system of finance under the federal government, but large expenditures by the states for carrying on the Revolutionary War, for which reimbursement was demanded by the states which had spent the most and was opposed by those which had spent the least. Hamilton endeavored to show that all would gain by the assumption of these debts by the federal government. Although a thinker rather than a tactician, he was shrewd enough to make an appeal early in his report to all men engaged in industry by pointing out the importance of public credit upon the volume and profits of private business. He endeavored first to make clear the benefit to any government of a sound fiscal system. He said upon this point:—