Hamilton's Legacy

Article excerpt

After the revolutions of 1989 brought down communism in Eastern Europe, many of the political and intellectual leaders of guidance to the United States. Americans of all political suasions recommended the writings of such sages as Thomas Jefferson, James Madison, and Abraham Lincoln. Alexander Hamilton was seldom mentioned, even though his contributions to that compendium of political wisdom, The Federalist, far outweigh those of his co-authors Madison and John Jay. No one suggested that the theories and example of Hamilton might be far more relevant to the new democratic regimes struggling to consolidate their rule and build new governmental, financial, and military institutions on the remnants of Soviet colonialism.

This oversight is puzzling, if not tragic, because Hamilton was perhaps the most practical nation builder among the Founding Fathers. Thanks largely to his vision and energy, the United States became what it is today: a relatively centralized nation-state with a military second to none in the world, a powerful presidency, a strong judiciary, and an industrial capitalist economy. John Marshall, the first chief justice of the Supreme Court, who did so much to fix Hamilton's expansive view of federal authority in law, thought that Hamilton and his mentor George Washington were the greatest of the Founders. One contemporary acquaintance, Judge Ambrose Spencer, who had clashed with Hamilton, nevertheless declared that he was "the greatest man this country ever produced.... He, more than any man, did the thinking of the time." The great French diplomat and statesman Talleyrand, who worked with Hamilton during the Revolution and the early years of the republic, put his "mind and character ... on a par with hose of! the most distinguished statesmen of Europe, not even excepting Mr. Pitt and Mr. Fox."

Such praise was anything but fulsome. As well as serving as George Washington's valued aide-de-camp during most of the Revolutionary War (and successfully reorganizing the Continental Army as one of his tasks), Hamilton helped to initiate the move toward a more centralized union that resulted in the Philadelphia convention of 1787 and the federal constitution. His view of the Constitution as the source of implied as well as enumerated powers became the dominant interpretation, thanks to his admirers and students John Marshall, Joseph Storey, and Daniel Webster, and his conception of expansive presidential war and foreign policy powers would prevail in the 20th century. As secretary of the treasury (1789-95), Hamilton established the fiscal infrastructure of the new republic, including the Bank of the United States, precursor of the Federal Reserve. He not only articulated the theory of tariff-based industrial policy (an inspiration to later American, German, and Japanese modernizers) but organized the Society for Useful Manufactures (SUM), the first American research institute and industrial conglomerate, sited on 38 acres by the Passaic River falls in Paterson, New Jersey.

Today, however, those who remember the mastermind of the Washington administration (1789-97) tend to know only a caricature of Hamilton as a champion of the rich-the prototype of such Wall Street wizards as Andrew Mellon and Michael Milken. Now and then Hamilton's ideas are invoked by those seeking to justify policies of economic nationalism, but more often "Hamiltonianism" is used as shorthand for a blend of plutocracy and authoritarianism, the antithesis of democratic idealism associated with his lifelong political rival Thomas jefferson. Jefferson placed a bust of Hamilton on the right side of the entrance hall at Monticello, across from his own portrait on the left. He explained to visitors: Opposed in death as in life.") Regardless of political orientations, American politicians all claim to be Jeffersonians. Few, if any, will admit to being Hamiltonians. In the late 20th century, it appears, the consensus holds that Noah Webster was right to name Hamilton "the evil genius of this country. …