Hamilton's critics claimed that his scheme would provide enormous profits to speculators who had bought bonds from Revolutionary War veterans for as little as 10 or 15 cents on the dollar. For six months, a bitter debate raged in Congress, until James Madison and Thomas Jefferson engineered a compromise.
D, Hamilton's financial plan was pretty controversial, but the issue of the creation of a national bank was the most contentious. Because the Constitution did not specifically provide for the creation of such a bank, Thomas Jefferson argued that it was therefore unconstitutional to do so.
Explanation:
Hamilton's vision for reshaping the American economy included a federal charter for a national financial institution. He proposed a BANK OF THE UNITED STATES. Modeled along the lines of the Bank of England, a central bank would help make the new nation's economy dynamic through a more stable paper CURRENCY.
The central bank faced significant opposition. Many feared it would fall under the influence of wealthy, urban northeasterners and speculators from overseas. In the end, with the support of George Washington, the bank was chartered with its first headquarters in Philadelphia.
The third major area of Hamilton's economic plan aimed to make American manufacturers self-sufficient. The American economy had traditionally rested upon large-scale AGRICULTURAL EXPORTS to pay for the import of British MANUFACTURED GOODS. Hamilton rightly thought that this dependence on expensive foreign goods kept the American economy at a limited level, especially when compared to the rapid growth of early industrialization in Great Britain.
Rather than accept this condition, Hamilton wanted the United States to adopt a MERCANTILIST economic policy. This would protect American manufacturers through direct government SUBSIDIES (handouts to business) and TARIFFS (taxes on imported goods). This PROTECTIONIST policy would help fledgling American producers to compete with inexpensive European imports.
Hamilton possessed a remarkably acute economic vision. His aggressive support for manufacturing, banks, and strong public credit all became central aspects of the modern capitalist economy that would develop in the United States in the century after his death. Nevertheless, his policies were deeply controversial in their day.
Many Americans neither like Hamilton's elitist attitude nor his commitment to a British model of economic development. His pro-British foreign policy was potentially explosive in the wake of the Revolution. Hamilton favored an even stronger central government than the Constitution had created and often linked democratic impulses with potential anarchy. Finally, because the beneficiaries of his innovative economic policies were concentrated in the northeast, they threatened to stimulate divisive geographic differences in the new nation.
Regardless, Hamilton's economic philosophies became touchstones of the modern American capitalist economy.
Bet you $10 you now see why he's on the $10 bill.
