Hamilton's Law and Finance - Borrowing from the Brits (And the Dutch)

62 Pages Posted: 1 Aug 2019

See all articles by Christian C. Day

Christian C. Day

Syracuse University - College of Law

Multiple version iconThere are 2 versions of this paper

Date Written: July 29, 2019

Abstract

We live in an era when Modern Monetary Theory has gained purchase. Deficits do not seem to matter to nations or their finance ministers. States believe the can print their way to utopia without a reckoning; this is a scheme freighted with disaster.

This article centers on the achievements of America’s greatest finance minister whose grasp of political economy was without equal. Hamilton charted the course for American economic power. His work is timely and worthy of study.

Late-18th century America sought commercial growth and new manufacturers yet feared monopolistic economic power. Hamilton’s economic program, centered on a national bank and program for manufacturing, provided the framework for the finance-led transformation of America. In a short time, Hamilton’s elegant solutions (based upon the English financial model) transformed America from a defaulting debtor to a magnet that attracted immense amounts of capital in the 19th century. The burden of the Revolutionary War debt needed to be resolved. Hamilton’s program: the assumption of the states and Confederation debt, its monetization, the establishment of the Bank of the United States, and Report on Manufactures laid the foundation for a vibrant economy. The article demonstrates how Hamilton’s prudent program strengthened the new federal government while providing the blueprint for the commercial society that emerged in the 19th century.

Keywords: Banking, Central Banking, Financial and Economic History, Capital Markets

JEL Classification: G10, N11

Suggested Citation

Day, Christian C., Hamilton's Law and Finance - Borrowing from the Brits (And the Dutch) (July 29, 2019). Available at SSRN: https://ssrn.com/abstract=3428606 or http://dx.doi.org/10.2139/ssrn.3428606

Christian C. Day (Contact Author)

Syracuse University - College of Law ( email )

Syracuse, NY 13244-1030
United States
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315-443-4141 (Fax)

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