Sublime

Jefferson Curl

Until the publication of Hamilton’s report, James Madison had been Washington’s most confidential adviser. That began to erode on February 11, 1790, when Madison rose in the House and, in a surprising volte-face, denounced the idea that speculators should benefit from Hamilton’s program. It was a stunning shot across the bow of the administration.

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He did this by activating three still amorphous clauses—the necessary-and-proper clause, the general-welfare clause, and the commerce clause—making them the basis for government activism in economics.

One of Hamilton’s first decisions as secretary of the Treasury was to ask Congress to establish America’s creditworthiness in the eyes of American and foreign creditors by taking over the debt of the states.

Although Washington seemed unaware of it, Hamilton had been training for the Treasury post throughout the war, boning up on subjects as diverse as foreign exchange and central banks. Like Washington, Knox, and other Continental Army officers, Hamilton had perceived an urgent need for an active central government, and he grasped the reins of power w

In his report, Hamilton championed several controversial measures. Some original holders of the wartime promissory notes, including many Continental Army veterans, had sold them after the war at a tiny fraction of their face value, believing that they would never be repaid in full. Hamilton planned to redeem them at face value and wanted current ho

That Washington turned to Hamilton for guidance reflects his lack of confidence in his newly installed cabinet and his continuing reliance on Hamilton as his economic tutor. When Hamilton was treasury secretary, Washington had had to keep him at arm’s length, juggling him against Jefferson, but he had no such inhibitions with Hamilton out of office