By Nancy Spannaus

June 13, 2019—As this blog has argued before, the first Hundred Days of the administration of Franklin Delano Roosevelt (FDR) represented a dramatic turning point  in American history.  As he had promised, FDR asserted the responsibility of the Federal Government to fulfill its Constitutional duty to promote the General Welfare of the population, in contrast to the reliance on the localities and private enterprise to deal with a crisis which they could not possibly resolve.

Celebrating FDR's Hamiltonian Hundred Days
Franklin Roosevelt Addresses the Nation on Banking Crisis in March, 1933

In both his election campaign and time in office, FDR repeatedly emphasized the necessity for energy in government to address the desperate needs of the population. The first Hundred Days, which ended June 16, 1933, dramatically exemplified that energy, with the passage of 15 major pieces of legislation in areas ranging from restoring the banking system, and providing immediate aid, to launching major infrastructure projects that would upgrade and transform the productivity of the economy well into the future. Not all of those measures accomplished their aims, but the directionality was changed toward lasting progress.

In so doing, despite his paeans to the Jeffersonian creed (including “freedom” from the Federal government), FDR was reviving the tradition of the founder of the American System of Economics, Alexander Hamilton. He outright rejected the idea that “the government that governs least governs best,” and insisted that the Federal government overturn the rule of the “money-changers” who had brought the catastrophe upon the nation by government action for the public good.


I am well aware that my assertion of FDR’s Hamiltonian principles is controversial, and for understandable reasons.  FDR’s verbal and written attacks are Hamilton are plentiful, and his sponsorship of the massive Jeffersonian Memorial in Washington, D.C. is well known.  I would never assert that Hamilton would support every single one of the economic measures which FDR took, but I am sticking by my argument that FDR and Hamilton shared certain fundamental principles of economy, which are not only at the heart of what spurred the United States’ spectacular growth, but also are desperately need to be revived today.

Celebrating FDR's Hamiltonian Hundred Days
The Jefferson Memorial

To understand the basis for my argument, I must refer you to my recent book, Hamilton Versus Wall Street: The Core Principles of the American System, which is readily available on all major internet booksellers. In hopes of enticing you, I am reprinting the opening section of the chapter “Franklin Roosevelt Chose Hamilton.”

Franklin Roosevelt Chose Hamilton

Public utility is more truly the object of public Banks, than private profit. And it is the business of Government, to constitute them on such principles, that while the latter will result, to a significant degree, to afford competent motives to engage in them, the former be not made subservient to it.

–Report on the National Bank

President Franklin Roosevelt remains as the most vivid exemplar of the Hamiltonian approach to economy for people today. Renowned as the champion of Hamilton’s opponent Thomas Jefferson, FDR in practice went back to the models of National Banking, and infrastructural and industrial development of the 19th Century.  Not only FDR, but numbers of his advisors were versed in the American System tradition.  Notable among them were Frances Perkins, Henry Wallace, Harry Hopkins, Harold Ickes, and Sen. Robert Wagner.

FDR had a sense of personal connection to the Hamilton tradition which was evident at his home in Hyde Park, where a Gilbert Stuart portrait of his great-great-grandfather Isaac Roosevelt sat over the mantel of the fireplace. Dubbed “The Patriot,” Isaac was a close collaborator of Hamilton at the New York State Ratifying Convention for the U.S. Constitution (1788), and later at the Bank of New York.

Presidential candidate FDR enunciated one of the key principles of Hamilton’s thought—voluntarism–when he addressed the Democratic Party nominating convention in July 1932:

Our Republican leaders tell us economic laws—sacred, inviolable, unchangeable—cause panics which no one could prevent. But while they prate of economic laws, men and women are starving. We must lay hold of the fact that economic laws are not made by nature. They are made by human beings.[1]

This statement is an echo of Hamilton’s arguments against the “natural course of things” put forward by Adam Smith, when Smith was arguing against the perspective of America embarking on industrialization. (See Chapter 7) Hamilton had determined that the welfare of the people demanded the development of manufactures, just as he had determined that an energetic Federal government gave him the tools to stop the Panic of 1792. FDR was following in his footsteps by declaring that a Constitutional government committed to the general welfare could challenge Wall Street’s depredations against the population, and he proceeded to do so.

Alexander Hamilton at the Treasury

The well-educated FDR had learned his history well. As he laid out in his acceptance speech to the Democratic Convention in 1936, he knew that national sovereign governments, such as Hamilton advocated, had developed as an historical advance to protect the welfare of the population from local baronies, and foreign powers.[2] In a paper he wrote on Hamilton,[3] Roosevelt openly acknowledged Hamilton’s critical role every step of the way in the formation of “a new and sturdier union” through the framing and ratification of the U.S. Constitution. He wrote:

Washington, the first President under the Constitution, made Hamilton Secretary of the Treasury.…  As he had stabilized the problems of State so now he ordered the finances of the country and it was his impetus that removed for all time the risk of disintegration of the States.

That’s pretty strong praise. When FDR took office, the United States was once again threatened with disintegration. Private financial interests centered in Wall Street had acted so as to violate the population’s basic rights to life, liberty, and the pursuit of happiness. In a 1932 speech to the San Francisco Commonwealth Club, candidate Roosevelt outlined his thought:

Every man has a right to his own property; which means a right to be assured, to the fullest extent attainable, in the safety of his savings. By no other means can men carry the burdens of those parts of life which, in the nature of things afford no chance of labor; childhood, sickness, old age. In all thought of property, this right is paramount; all other property rights must yield to it. If, in accord with this principle, we must restrict the operations of the speculator, the manipulator, even the financier, I believe we must accept the restriction as needful, not to hamper individualism but to protect it.

These two requirements must be satisfied, in the main, by the individuals who claim and hold control of the great industrial and financial combinations which dominate so large a part of our industrial life. They have undertaken to be, not business men, but princes–princes of property. I am not prepared to say that the system which produces them is wrong. I am very clear that they must fearlessly and competently assume the responsibility which goes with the power. So many enlightened business men know this that the statement would be little more than a platitude, were it not for an added implication.

This implication is, briefly, that the responsible heads of finance and industry instead of acting each for himself, must work together to achieve the common end. They must, where necessary, sacrifice this or that private advantage; and in reciprocal self-denial must seek a general advantage. It is here that formal government–political government, if you choose, comes in. Whenever in the pursuit of this objective the lone wolf, the unethical competitor, the reckless promoter, the Ishmael or Insull whose hand is against every man’s, declines to join in achieving an end recognized as being for the public welfare, and threatens to drag the industry back to a state of anarchy, the government may properly be asked to apply restraint. Likewise, should the group ever use its collective power contrary to public welfare, the government must be swift to enter and protect the public interest [emphasis added].[4]

After his election a few months later, FDR took on the responsibility to apply that restraint, some of which was eagerly sought by bankers who could see that their greed had threatened to bring down the whole system. Thus, even before FDR could introduce the banking regulations against speculation ensconced in Glass-Steagall and the Securities Act, bankers such as Chase National Bank’s Winthrop Aldrich[5] were campaigning for bank separation. (The major holdout remained London’s favorite American banker, J.P. Morgan.)

But even after the FDR Administration had taken the initial steps to bring the banking system under control, Wall Street refused to direct funds into building up the economy; it continued to loot the population through foreclosures, refusing to adjust loans, and enforcing bankruptcies. FDR sought to deal with this sabotage by proposing that the Federal Reserve create Hamiltonian “credit banks for industry,”[6] which would provide working capital to businesses which could not get it from Wall Street or other sources. When this effort failed, FDR and Reconstruction Finance Corporation (RFC) head Jesse Jones successfully moved to expand the Fed’s authority to lend, and to pass the Industrial Advances Act of June 1934, which permitted the RFC to carry out the same functions FDR had proposed for the credit banks. …

The author at a book signing April 7.

For more, please order the book.

[1] The Essential Franklin Delano Roosevelt, FDR’s Greatest Speeches, Fireside Chats, Messages, and Proclamations, edited by John Gabriel Hunt, Gramercy Books, New York, 1995.

[2] Hunt, ed. Ibid.

[3] Anton Chaitkin, unpublished manuscript, “How Roosevelt Became a Revolutionary.”

[4] Commonwealth Club address, September 23, 1932,

[5] See Nomi Prins, All the Presidents’ Bankers, The Hidden Alliances That Drive American Power, Nation Books, New York, 2014.

[6] Tim Sablik, “Fed Credit Policy during the Great Depression”, Federal Reserve Bank of Richmond, March 2013, EB13-03. Click here.


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