The subject of Finance had not at that early period been made as familiar to the American mind as it has since become, and the genius of Hamilton and the sanction of Washington, which his plans were supposed to receive, were well calculated to discourage opposition to them. But many of those who disapproved of his course were not to be moved from what they regarded as the line of duty by any considerations personal to themselves. They resisted Hamilton's financial schemes from the start, and it was in the discussions upon this issue that some, who subsequently became famous leaders in the old Republican party, fleshed their maiden swords. No two measures ever attracted a larger share of the attention of the American people, excited more deeply their feelings and their apprehensions, or exerted a greater influence upon the politics of this country than did the funding system and the first Bank of the United States. The peculiar results of the contest that was waged in respect to them will be noticed hereafter.
Hamilton had done much by their establishment and organization to strengthen the Federal arm, and proportionately to weaken the State governments, but the influence he derived from these measures was not sufficiently operative upon several classes whom he desired to conciliate. The wished for impression had been made upon the commercial class,—at all times a powerful body and by the nature of their pursuits inclined to favor strong governments, banks, and funding systems,—upon the domestic creditors of the General Government, upon the creditors of the several State governments, upon all who had a passion for gambling in stocks, to whose appetites he furnished so much aliment,—a numerous, crafty, and influential portion of almost every community,—and upon all who wanted to borrow or had money to lend, a class still more numerous. Besides these, whom Mr. Canning called the "train-bands of commerce," in general the most dangerous to encounter and the most efficient when at his service, there were still larger interests, and in the aggregate more powerful, upon whom the Secretary desired to make similar impressions and to secure their attachment to his system.
In August, 1791, whilst concocting the measures by which he hoped to secure the support of these, and flushed by the success which had hitherto crowned his efforts, he thus (as I have already quoted) addressed his great rival, Mr. Jefferson:—
"I own," said he, "it is my opinion, though I do not publish it in Dan or Beersheba, that the present Government is not that which will answer the ends of society, by giving stability and protection to its rights, and that it will probably be found expedient to go into the British form; however, since we have undertaken the experiment, I am for giving it a fair course, whatever my expectations may be. The success, indeed, so far, is greater than I had expected, and therefore at present success seems more possible than it had done heretofore, and there are still other and other stages of improvement, which, if the present does not succeed, may be tried and ought to be tried before we give up the republican form altogether."
First in the order of time among "the other and other stages of improvement" with which the prolific mind of the Secretary was busied, were doubtless those embraced in his "Report on Manufactures" which made its appearance four months afterwards, and was probably then in course of preparation. It contains more than a hundred folio pages, in print, and is perhaps the most thoroughly elaborated and artfully devised state paper to be found in the archives of any country. Manufactures were alone spoken of in the title, but it embraced every species of industry that offered the slightest chance of being successfully prosecuted in the United States, and contained a very full and carefully considered exposition of their respective conditions, and of the facilities by which their success might be increased, to extend which to those diversified interests it undertook to show was within the power and the duty of the Government. This report, on account of the striking illustration it affords of the progress of parties, and the powerful influence it exerted upon their fate, is well entitled to the fullest notice. But it is not possible within the limits I have prescribed to myself to go as fully into the review of such a paper as justice to the subject would require. I must therefore content myself with an abridged account of the various branches of industry the advancement of which was the design of its author, and of the manner in which he proposed to accomplish his object.
The manufactured articles which he specified as fit subjects for governmental aid were those made of skins, of iron, of wood, of flax and hemp, bricks, coarse tiles, and potters' wares, ardent spirits and malt liquors, writing and printing paper, hats, refined sugars, oils of animals and seeds, soap and candles, copper and brass wares, tin wares, carriages of all kinds, snuff, chewing and smoking tobacco, starch, lampblack and other painters' colors, and gunpowder. This enumeration was followed by a detailed statement of the great variety of articles embraced in the general denominations. Besides these, which he said had attained a considerable degree of maturity, there was a vast sum of household manufacturing which was made not only sufficient for the use of the families that made them but for sale also, and in some instances for exportation, and consisted of great quantities of coarse cloths, coatings, serges, and flannels, linsey-woolseys, hosiery of wool, cotton and thread, coarse fustians, jeans and muslins, checked and striped cotton and linen goods, bedticks, coverlets and counterpanes, tow linens, coarse shirtings, sheetings, toweling, and table linen, and various mixtures of wool and cotton, and of cotton and flax.
These observations were, he said, the pleasing result of the investigation into which the subject of his report had led, and were applicable to the Southern as well as to the Middle and Northern States. He also designated the principal raw materials of which these manufactures were composed, and which were, or were capable of being, raised or produced by ourselves. These were iron, copper, lead, fossil coal, wool, skins, grain, flax and hemp, cotton, wool, silk, &c., &c.
The Secretary contended that the growth and production of all the articles last named were, in common with the manufactures of which they constituted the raw material, entitled to the encouragement and specific aid of the Federal Government.
He next pointed out the various modes in which that aid might be afforded, varying its application according to circumstances; viz.:
1st. By protecting duties.