Jefferson and Hamilton by John Ferling

Author:John Ferling
Language: eng
Format: epub
Publisher: Bloomsbury Publishing
Published: 2013-03-24T16:00:00+00:00

Chapter 10

“Devoted to the paper and stockjobbing interest”

Unbridled Partisan Warfare

It is not likely that Jefferson thought the bank would be the final peg in Hamilton’s program. Washington, in his initial State of the Union message in January 1790, had urged the “advancement of … manufactures” to render the United States independent of other nations, “particularly for military supplies.” Congress endorsed the president’s proposal and directed the treasury secretary to act on it.1 So, it could not have come as much of a surprise when, in the autumn of 1791, Hamilton submitted one final report, a plan for encouraging manufacturing.

Though considerably longer and less reader-friendly than his earlier reports—even Hamilton bemoaned its “great copiousness”—this was his crowning achievement, for he foretold America’s industrial destiny and how to get there. Asserting that manufacturing would increase American security, he spoke of the dangerous “contrariety of interests” that existed between North and South, and made a case for how manufacturing would bring the sections closer. (Though the cotton gin would not be patented for another two years, he prophesied that northern mills would foster “the extensive cultivation of Cotton.”) But his principal defense of industrialization was that national “independence and security” were materially connected with the prosperity of manufactures”; in short, a vibrant manufacturing nation could in a “future war” avoid the “extreme embarassements of the … late War.”

Hamilton proposed that manufacturing be facilitated through federal subsidies, liberal immigration policies, national defense contracts, government-owned arms factories, publicly assisted improvements to the nation’s infrastructure of roads and bridges, and the labor of women and children. (Bluntly, he wrote that in a manufacturing society, “women and Children would be rendered more useful and the latter more early useful.”) He asserted that it was legally within the grasp of the national government to do these things. It required only an elastic interpretation of Congress’s authority to “provide for the Common defence and general welfare.” Even so, he said that most of the capital would come from private investors, whose ability to act would be aided by funding and the bank. He also believed that not only would Europeans eagerly sink their capital in American manufacturing endeavors, but also that many Old World capitalists would want to move to America to better manage their investments.2

Simultaneously, the Society for Establishing Useful Manufactures came into being, a body created to “concretize his report,” in the words of a Hamilton biographer.3 The society was the brainchild of Tench Coxe, the assistant secretary of the Treasury, but it was born with Hamilton’s avid backing and chartered by New Jersey. It sold stock to raise capital, through which it planned to purchase seven hundred acres along the Passaic River, where it would build a town replete with factories and mills that would produce shoes, hats, fabrics, wire, pottery, carpets, and paper. It might even erect a distillery.4 If the enterprise flourished, Hamilton envisaged capitalists rushing to emulate the New Jersey model.

Jefferson disapproved of neither manufacturing within his Arcadian America nor making the United

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