Alexander Hamilton’s Early War for Our Economic Independence

by Nancy Spannaus

[The following is the speech I presented to The Revolutionary War Conference 250 in the Mohawk Valley, in Fort Plain, New York on June 16., 2024. It is my work on this presentation which is responsible for the reduced content on the blog over the past weeks.  You can look forward to a number of other postings on the content of the Fort Plain conference, which, as usual, featured some excellent contributions. –Nancy]

As partisans of the American Revolution, we are all familiar with Alexander Hamilton’s crucial contributions to the success of that venture. Three areas stand out. First, his role as General Washington’s aide-de-camp, as well as his personal military achievements, made him a military hero. Second was his dominant contribution in securing the U.S. Constitution, which included calling the Convention itself, to waging the uphill battle to having the document ratified by New York and Virginia. The third, and most murky to many, was his success in creating the framework, in theory and partially in practice, for an economic system that became the envy of the world.

The author on the stage at Fort Plain.

To Hamilton, I contend, all of these contributions were aspects of one overriding objective: creating an economically independent republic, which could survive and thrive in a world dominated by imperial powers. In fact, he was thinking about this objective 15 years before the Constitution went into effect!

The title of my speech is a case in point: “To the Future Grandeur and Glory of America” is a quote from Hamilton’s 1774 document defending the First Continental Congress.

My presentation today will draw on my two books on Hamiltonian economics, Hamilton Versus Wall Street: The Core Principles of the American System of Economics, and Defeating Slavery: Hamilton’s American System Showed the Way.   In line with Brian’s wish that we concentrate on events leading up to the 250th birthday of the United States, I will show how Hamilton’s first two major political documents – written in late 1774 and early 1775 – contain the seeds of the very principles which he incorporated into his economic vision for the country.

Hamilton’s American System

First, a quick overview of the core principles behind that vision, which can be called the American System of Economics.

In April 1781, when the war for independence was still raging, Hamilton was already focused on economy. He wrote to the newly appointed Superintendent of Finance Robert Morris: “Tis by introducing order into our finances—by restoring public credit—not by gaining battles, that we are finally to gain our object.” Although he had just resigned from Washington’s staff, he was still concentrating on not just winning the war, but actually securing economic independence.

Hamilton’s Report on Manufactures, 1791

The fullest explication of what Hamilton thought was necessary to achieve that status appears in his Report on the Subject of Manufactures, which he submitted to Congress in December of 1791. That report begins with an attack on the argument of Adam Smith (not by name, as per the fashion of the time) that the young United States should not devote its resources to building up its manufactures.  Hamilton proceeds over the next 30,000 words or so to show why fostering manufactures was necessary to a nation’s prosperity, how it would benefit our country, why the naysayers were mistaken, and what specific measures should be taken for 16 different industries.

He summarizes his argument as follows:

Not only the wealth; but the independence and security of a Country, appear to be materially connected with the prosperity of manufactures. Every nation, with a view to those great objects, ought to endeavour to possess within itself all the essentials of national supply. These comprise the means of Subsistence, habitation, clothing, and defence.

The possession of these is necessary to the perfection of the body politic, to the safety as well as to the welfare of the society; the want of either, is the want of an important organ of political life and Motion; and in the various crises which await a state, it must severely feel the effects of any such deficiency. (emphasis in original)

To secure these aims, Hamilton employed the political economic principles which I summarize in this slide. The items in the parentheses are the particular policies or institutions which he conceived for their implementation in his time:

  1. National sovereignty, including over currency (National Bank)
  2. Government protection (tariffs, bounties) for labor and crucial industries
  3. Public credit backing economic growth (including infrastructure development)
  4. Economic independence and national unity (General Welfare)

It is these principles, embattled as they were, which have long survived Hamilton’s demise, despite the attacks on his personal reputation. By the 1820s they were popularly known as the American System, thanks to Congressman Henry Clay, and in the most productive periods in our history, they have been put into effect.

I’m often asked, where did Hamilton get these principles? We know many of the books he read, ranging from political philosophy to finance. The authors came from England, Scotland, France, and Switzerland, and are heavily tilted toward what is called the Mercantilist school, but would be better described as economic nationalism.  Exemplary is this fellow, Jean-Baptiste Colbert, the finance minister for Louis XIV, whose dirigiste development of France into a nation Hamilton specifically praised in his Continentalist papers.

Jean-Baptiste Colbert’s nation building policies were praised by Hamilton.

But Hamilton was not a copyist. He used the ideas he got from his readings, along with certain basic philosophical beliefs, to come up with a unique system to address a unique situation. With them, he brought our fledgling nation out of bankruptcy, and into prosperity.

That said, let’s now turn our attention to Hamilton’s major writings from 1774 and 1775. Not counting some newspaper articles in the patriotic press which are attributed to him and the speech he allegedly gave in the Fields in July 1774, these two essays are considered his first major political salvos for the Revolution. Both were published as pamphlets. I believe that they not only show Hamilton to be a precocious polemicist (he was probably 19 at the time), but also preview some of the fundamental principles which he advocated in his economic plans and elsewhere for the rest of his life.

The Document War — The First Interchange

The first document appeared on December 15, 1774, with the following title: A Full Vindication of the Measures of the Congress, from the Calumnies of their Enemies; In Answer to A Letter, Under the Signature of A.W. Farmer. Whereby His Sophistry is exposed, his Cavils confuted, his Artifices detected, and his Wit ridiculed; in a General Address To the Inhabitants of America, And A Particular Address To the Farmers of the Province of New York. Veritas magna est & prœvalebit. Truth is powerful, and will prevail. While Hamilton did not sign his name, we know it to be his work.

Hamilton was answering a document published approximately one month before (Nov. 16, 1774) by the Reverend Samuel Seabury, a well-known prelate of the Anglican Church who resided in Westchester County. Seabury had taken up his pen to attack the decisions of the First Continental Congress (it ended on October 26), which set deadlines for establishing a non-importation/non-exportation policy if the British did not reverse their punitive measures against Boston and the other violations of the Americans’ fundamental rights. That Congress, which drew representatives from all the colonies but Georgia, was prompted by the Coercive Acts that shut down the Boston port, and on top of its demands for lifting the siege and reversing the measures which provoked Boston’s revolt, concluded with a petition to the King.

Hamilton’s antagonist, the Rev. Samuel Seabury, portrait by Ralph Earl

Although Seabury was no “Westchester Farmer,” he billed his attack on the Congress “Letters of a Westchester Farmer: Free Thoughts on the Proceedings of the Continental Congress; Letters to the Farmers – by a Farmer.”

Seabury argued that the Congress had betrayed the farmers; was seeking to blackmail Great Britain and her other colonies in order to aid the scheme of some for independence; would alienate our friends in London; and, if its measures were put into effect, would lead to the British Empire crushing the American colonies. He characterized the members of the Congress as trying to enslave their fellow citizens, and baldly stated

“If I must be enslaved, let it be by a KING at least,” not “Lord the Mob.”

Hamilton’s response was a full-throated defense of the Congress and their motives (he denied a plot for independence). He began with his fundamental premise: that the colonists’ natural rights were being trampled upon. Hear his words:

That Americans are intitled to freedom, is incontestible upon every rational principle. All men have one common original: they participate in one common nature, and consequently have one common right. No reason can be assigned why one man should exercise any power, or pre-eminence over his fellow creatures more than another; unless they have voluntarily vested him with it. Since then, Americans have not by any act of theirs impowered the British Parliament to make laws for them, it follows they can have no just authority to do it.

He then argued that the non-importation and non-exportation measures were necessary because petitioning had failed, and such measures were the only alternative to all-out war to defend the “rights of Englishmen,” which included not being taxed without their consent. Hamilton’s argument is consistent with those of the English Whigs.

Hamilton expressed particular scorn for those who claimed the revolt was simply against the tea tax; no, he wrote, it was against Parliament’s claim that they could tax the colonists in any way they wished, without their consent.

In a follow-up argument which he used often in later documents, he asked whether Congress’s measures would create a greater evil than the evil they were countering.  No, he said, because what the Parliament is pursuing is the enslavement of America, and whatever difficulties are created by the measures would be less damaging than that.

Lastly Hamilton argued that Congress’s measures had a great probability of success. Great Britain would find that it was self-defeating to continue its policies, since the long-standing trade arrangements were greatly to their economic advantage. Britain’s enemies, France and Spain, would move to take advantage of the conflict. And in fact, he asserted, we Americans can live without trade with Great Britain and her other colonies; if they stop all trade, we can develop our own resources, including our manufactures! (more on that later)

The French’s crucial support for the Americans was anticipated by Hamilton. Here, Comte de Rochambeau.

Hamilton also noted that there was an aspect of jealousy in the British parliamentary attack on America; they were well aware of the potential in our growing population, resources, and resourcefulness. Hopefully, they will come to their senses. He concluded this section with this feisty statement:

All we aim at, is to convince your high and mighty masters, the ministry, that we are not such asses as to let them ride us as they please. We are determined to shew them, that we know the value of freedom; nor shall their rapacity extort, that inestimable jewel from us, without a manly and virtuous struggle.

Hamilton then added a special address to the farmers, noting that he was well aware that Seabury was no farmer, and was just using that claim in his effort to split the rural population from those in the cities. He denied that farmers would suffer the most, and asserted the reality that the mutual dependence of the urban (merchant) economy and the farm economy ensured that both sectors thrive or suffer together.

The Polemics Escalate

Seabury immediately answered Hamilton’s pamphlet with another of his own, entitled A View of the Controversy Between Great Britain and Her Colonies, published on Dec. 24, 1774. He posed himself as a defender of freedom and denied that the colonial legislatures, now operating independent of the authority of the British Crown, had any legislative authority. His argument is telling:

The position that we are bound by no laws to which we have not consented, either by ourselves, or our representatives, is the novel position, unsupported by any authoritative record of the British constitution, ancient or modern. It is republican by its very nature, and tends to utter subversion of the English monarchy.

Seabury insisted that governing regimes, meaning Parliament as well as the King, had the ability to tax however they wished as part of their claim to sovereignty. He dismissed the idea, which had been argued by Whigs and Americans like John Dickinson, that taxation for revenue was the province of the colonial legislatures, which, they argued, stood in relation to the King in the same way that the Parliament stood in Great Britain itself.

King George III

In response to the possible rejoinder that such a policy rendered American assemblies useless (powerless), Seabury argued that the legislatures would be heard if they just politely petitioned for redress of their grievances. It’s the “madmen from Virginia and Massachusetts” (his words) who are preventing this from happening. We should moderate our demands, and we will be secure from slavery, he asserted.

As for himself, he would rather die than that “the imperial dignity of Great Britain should sink.”

Once again, Hamilton rose to defend the colonists’ cause, with a pamphlet entitled The Farmer Refuted or A more impartial and comprehensive View of the Dispute between Great-Britain and the Colonies, Intended as a Further Vindication of the Congress.” It was published on February 23, 1775. In this lengthier presentation, he marshaled one authority after another to support his argument that the “natural rights of mankind” dictated that Great Britain could not exercise the powers over the colonies which Seabury asserted.

Hamilton’s opening section was again devoted to the theory of natural law, and elaborated on the existence of a moral law higher than that of the King and the parliament. Any governing body, be it the king or the parliament or others, which violated that law was illegitimate. “Ignorance of the natural rights of mankind” was the fundamental source of all errors in governance.

He then detailed the history of the charters granted by the King (not the parliament) to the colonies, pointing out how these documents left internal governing (including taxation for revenue) to the colonial legislatures. They only mandated loyalty to the King, whose duty it was to protect them and their rights.

Moving on to the economic issues, he elaborated on how the current system of trade was providing Britain with a “plentiful source of wealth.” The new policy of taxation would lead to the colonies being “drained of all our wealth, for those necessaries, which we are not permitted to get elsewhere.” Submitting to Parliament’s policy would lead to absolute slavery. The submission demanded by Parliament is open-ended and thus will lead to violations of the first principles of civil society (natural rights), he wrote.

Britain has gained greatly from the colonies, he argued, and our measures should bring them to their senses. It would be madness for the British to launch a war against us – they would kill the “golden goose.” We would outnumber them, be able to fight irregular warfare, and win support abroad from Britain’s traditional enemies, even if it were surreptitious.

The Enduring Principles

I have deliberately truncated my description of Hamilton’s documents so far, saving more extensive quotations for my discussion of those concepts which I believe have endured throughout his career. I propose to both identify them and show, briefly, how Hamilton applied them in his subsequent political career.

In general, of course, one sees in these two publications certain characteristics that pervade all his literary works, including his state papers. He adopts a polemical style, although falling short of a diatribe. He relies on mustering an overwhelming mass of detailed documentation to support his points, demonstrating his own exhaustive study of the matters under discussion. He addresses the counterarguments pre-emptively in such a way as to box his adversary into a corner. Even his die-hard opponents found it difficult to answer his argumentation. From this method, we can understand Jefferson’s much-quoted evaluation that Hamilton was “really a colossus to the anti-Republican party. Without numbers, he is a host within himself.” (Jefferson to Madison on September 21, 1795).

In specific, I see four major principles that Hamilton develops, or relies on, in the Full Vindication and Farmer Refuted, which serve as a foundation for his later economic plans. They are: 1) the “natural rights of mankind;” 2) that the common good, or general welfare, depends on national unity; 3) that slavery is an economic as well as moral disaster; and 4) that development of manufactures is vital to national survival as an independent nation.

The Natural Rights of Mankind

Both the Full Vindication and The Farmer Refuted begin with the assertion that the basic fault line between the American colonists and the British Parliament is the question of what are the “natural rights of mankind.” The argumentation in The Farmer Refuted is by far the most profound.

Hamilton acknowledges that both sides of the conflict profess a commitment to certain natural rights. But there is more than one way to define those rights, he goes on.

Thomas Hobbes, whose philosophy of man’s “natural rights” Hamilton attacked.

He accuses Seabury of adopting the Hobbesian (and also Lockean, I assert) view that man in a “state of nature” is “totally free of all restraint of law and government;” man is allegedly encumbered by no moral law and simply will act out of his own self-interest. Under those conditions, government is required in order to prevent people from killing each other, stealing willy-nilly, and generating total chaos. Government, basically acting as a policeman, then is the source of moral law, dictating what individual rights are necessary for society’s (and the individual’s) survival.

But there is another view of natural rights, Hamilton says:

Good and wise men, in all ages, … have supposed, that the deity, from the relations, we stand in, to himself and to each other, has constituted an eternal and immutable law, which is, indispensably, obligatory upon all mankind, prior to any human institution whatever.

This is what is called the law of nature, “which, being coeval with mankind, and dictated by God himself, is, of course, superior in obligation to any other. It is binding over all the globe, in all countries, and at all times. No human laws are of any validity, if contrary to this; and such of them as are valid, derive all their authority, mediately, or immediately, from this original.” Blackstone.

Upon this law, depend the natural rights of mankind, the supreme being gave existence to man, together with the means of preserving and beatifying that existence. He endowed him with rational faculties, by the help of which, to discern and pursue such things, as were consistent with his duty and interest, and invested him with an inviolable right to personal liberty, and personal safety.

Hence, in a state of nature, no man had any moral power to deprive another of his life, limbs, property, or liberty; nor the least authority to command, or exact obedience from him; except that which arose from the ties of consanguinity.

Hence also, the origin of all civil government, justly established, must be a voluntary compact, between the rulers and the ruled; and must be liable to such limitations, as are necessary for the security of the absolute rights of the latter; …

In elaborating this point in relation to the relationship between Great Britain and its colonies, Hamilton adds another crucial element: the  “supreme law of every society—its own happiness.” (emph. in original)

Later on in The Farmer Refuted, Hamilton revisits the question of the “rights of mankind” in the context of his examination of the founding documents of the colonies (in this case, New York). There’s no explicit statement of the colony’s rights to self-government in these documents, Hamilton admits, but then pens what is perhaps the most poetic statement of his entire opus:

The sacred rights of mankind are not to be rummaged for, among old parchments, or musty records. They are written, as with a sun beam, in the whole volume of human nature, by the hand of the divinity itself; and can never be erased or obscured by mortal power.

This description has long stuck in the craw of those who consider Hamilton an unprincipled pragmatist. They argue that he later abandoned such youthful idealism for hard-nosed politics. I don’t see it that way.

First, this expression of the natural rights of man fits perfectly with Hamilton’s lifelong opposition to slavery. Note the similarity to the preamble to the New York Society for Promoting the Manumission of Slaves, of which Hamilton was an early and leading member: “The Benevolent Creator, and Father of all Men; having given to them all an equal right to life, liberty, and property, no sovereign power on earth can justly deprive them of either but in conformity to impartial laws, to which they have expressly or tacitly consented.” I will discuss this issue at more length later on.

More broadly, I think we can discern in Hamilton’s view of fundamental unwritten human rights an animating principle of his approach to creating a nation. The limitations which he believed existed, or should be imposed, on individual assertions of rights, are derived from this belief in a pre-existing moral law, a law which should be discernible by reason, but not rely on the will of the authority. Thus, he could not simply subscribe to “majority rule,” should that majority violate what he saw as the natural rights of the minority.

Indeed, as one of the important intellectual influences on Hamilton’s thinking, Emerich Vattel, put it, “The general law of that society [natural society-ed.] is, that each individual should do for the others everything which their necessities require, and which he can perform without neglecting the duty he owes to himself: a law which all men must observe in order to live in a manner consonant to their nature…”

Swiss jurist Emer de Vattel

According to the records we have of the Constitutional Convention debate, Hamilton reflected Vattel’s view by defining the ends of government as not simply protecting individual liberties to property and safety, as Founders like Madison emphasized. Rather, as Hamilton biographer Forrest McDonald points out, Hamilton declared that government should have positive purposes: 1) provide for “the great purposes of commerce, revenue, [and] agriculture”; 2) facilitate “domestic tranquility & happiness”; and 3) establish “sufficient stability and strength to make us respectable abroad.”

This philosophy naturally leads us to the second fundamental concept that animated Hamilton, that of the “common good,” or “general welfare.”

The Common Good, or General Welfare, Depends on National Unity

One salient feature of Hamilton’s two pamphlets is the fact that he purports to speak of the interests of no class of people, but of “America.” It’s often been stressed that Hamilton’s strength (or, in a Jeffersonian view, his failing) was that he was not attached to any particular colony. He had only been in New York since the fall of 1773, after a year of study in New Jersey, so it’s not surprising that he would not write as a New Yorker. Yet his consistent reference to the interests of America, and his signature on these documents (“A sincere friend to America”), not only contrast with Seabury’s localist appeal, but emphasize his fealty to the colonies as an emerging nation.

In addition, Hamilton refuses to fall into Seabury’s attempt to counter-pose the interests of the farmers, with those of the revolutionary leadership residing in the cities. When discussing the impact of the non-importation and non-exportation policies the Congress was threatening to enact, he seeks to show how each of these economic sectors would naturally support one another under those circumstances. The merchants and manufacturers would aid the farmers by relying more heavily on them for supplies, and in the face of this mutual dependence, the merchants would not (as Seabury charged) raise their prices to farmers to exorbitant levels.

Hamilton was writing during a period of relatively maximum colonial unity, as the colonists were rapidly coming together in support of Boston against the British crackdown. But that unity had its ups and downs, and in the crucial post-war period, and the Constitutional convention itself, disagreement over the degree of mutual interests between the individual states, and the nation as a whole, raged.

Yet, the objective of the “general welfare” is the only one mentioned twice in the Constitution – once in the Preamble and then again under the powers of Congress.  Hamilton, by the way, was one of the five members of the Committee of Style who crafted that Preamble.

Throughout his career, Hamilton stuck to the idea of defining the “general welfare” of the United States as a whole, and sought to implement Federal government policies that would implement it. A couple examples.

In Federalist Number 11 he discusses the complementary strengths of the various colonies as an important element of national prosperity.

Then, in his Opinion on the Constitutionality of the National Bank (February 1791), he argued that “the powers contained in a constitution of government, especially those which concern the general administration of the affairs of a country, its finances, trade, defence & ought to be construed liberally, in advancement of the public good.” He believed in regulation of industry and banking for the “public utility,” rather than simple individual profit, much to the chagrin of some of his more monied friends.

Perhaps the strongest expression of Hamilton’s belief in the Federal government acting in support of the general welfare is in this passage in the Report on Manufactures:

It is therefore of necessity left to the discretion of the National Legislature, to pronounce, upon the objects, which concern the general Welfare, and for which under that description, an appropriation of money is requisite and proper. And there seems to be no room for a doubt that whatever concerns the general Interests of learning of Agriculture of Manufactures and of Commerce are within the sphere of the national Councils as far as regards an application of Money. (emphasis in original)

Here he adds to the “general welfare,” the concept of what is “requisite and proper,” which appears in the Constitution as the “necessary and proper” clause in Article I, Section 8.

During his time as Secretary of the Treasury, Hamilton was not able to apply the General Welfare principle very broadly, but he and Washington did launch what some have called our nation’s “first infrastructure project,” the completion of the network of lighthouses, which were brought under federal control. The one you see is at Fort Henry, Virginia and was finished in 1791. It was called “Hamilton’s Light.”

Cape Henry lighthouse in Virginia, finished in 1792, was called Hamilton’s Light.

Hamilton’s arguments for “liberal” construction have been taken up repeatedly throughout our nation’s history.  One of the most notable cases was that of Chief Justice John Marshall, a close colleague of Hamilton’s from Valley Forge on, who relied on the “necessary and proper” clause in his 1819 decision upholding the constitutionality of the second Bank of the United States. But it clearly included the infrastructure projects initiated under the John Quincy Adams administration,

Lincoln’s internal improvements programs, and (controversial as it may sound to some) the public infrastructure we largely rely on today, a shocking amount of which was built under the FDR administration.

In later years, and even today, many questioned the ability to define the “general welfare,” but Hamilton did not. He understood that the prosperity of each sector of the country, each with its own economic strengths, depended upon collaboration for the good of the whole. And the Federal government had to have sufficient power to make sure that such cooperation proceeded.

Slavery is an economic, as well as moral, disaster

As I have noted, one of Hamilton’s fundamental premises in both documents was that the British Parliament was threatening to impose slavery on the American colonies. Slavery, he asserted, was contrary to natural law as no man has the right to wield absolute power over another. And the consequences would be disastrous on all levels.

His most succinct statements on this issue appear in The Full Vindication, and read as follows:

The only distinction between freedom and slavery consists in this: In the former state, a man is governed by the laws to which he has given his consent, either in person, or by his representative: In the latter, he is governed by the will of another. In the one case, his life and property are his own, in the other, they depend upon the pleasure of a master. It is easy to discern which of these two states is preferable. No man in his senses can hesitate in choosing to be free, rather than a slave.

Later, he addresses the economic dimension:

Were not the disadvantages of slavery too obvious to stand in need of it, I might enumerate and describe the tedious train of calamities, inseparable from it. I might shew that it is fatal to religion and morality; that it tends to debase the mind, and corrupt its noblest springs of action. I might shew, that it relaxes the sinews of industry, clips the wings of commerce, and introduces misery and indigence in every shape.

Under the auspices of tyranny, the life of the subject is often sported with; and the fruits of his daily toil are consumed in oppressive taxes, that serve to gratify the ambition, avarice, and lusts of his superiors. Every court minion riots in the spoils of the honest labourer, and despises the hand by which he is fed. The page of history is replete with instances that loudly warn us to beware of slavery.

Was Hamilton speaking of the enslavement of Africans as well as the threat to white colonists? There is no doubt in my mind that he included them. His very language (sporting with the life of the subject, for example) evokes the condition of the plantation slave, one with which he was very familiar from his experience in the Caribbean. He had already observed the deleterious effects of a slave economy on a population.

Add to that the history of his involvement in anti-slavery causes – advocating that Blacks be given freedom and serve in the Continental Army, helping establish the New York Manumission Society, opposing implementation of the Paris Treaty provision that called for enslaved persons liberated by the British to be returned to their “owners” – and his moral stand against chattel slavery is clear.

Then there is Hamilton’s economic outlook. A reading of the Report on Manufactures underscores his belief that mechanization of production (technological progress), and the provision of infrastructure, were both essential elements to building the nation through building a manufacturing base. Both of these policies are directly antithetical to the slave economy, as was explicitly demonstrated by the opposition to them by the loudest political advocates for both maintaining and expanding slavery, as well as their practice.

It was left to Hamilton’s advocates in the mid-1800s, such as Lincoln’s economic advisor Henry C. Carey, to explicitly make the case that industrialization ala Hamilton would provide a pathway for ending slavery. Hamilton didn’t do so, but he laid the basis for that to be done.

The development of manufactures is vital to national survival as an independent nation

The most conspicuously prescient, even stunning, aspect of Hamilton’s two early pamphlets is his elaboration of the prospects for the American colonies to become a self-sufficient manufacturing nation. Both documents deal with this point.

In A Full Vindication, Hamilton stresses the losses to the British economy that would arise from the cut-off of American exports, but he also devotes a substantive paragraph to what the colonies can do if put under siege by the British fleet.

We can live without trade of any kind. Food and clothing we have within ourselves. Our climate produces cotton, wool, flax, and hemp, which, with proper cultivation would furnish us with summer apparel in abundance. The article of cotton indeed would do more, it would contribute to defend us from the inclemency of winter. We have sheep, which, with due care in improving and increasing them, would soon yield a sufficiency of wool. The large quantity of skins, we have among us, would never let us want a warm and comfortable suit. It would be no unbecoming employment for our daughters to provide silks of their own country. The silk-worm answers as well here as in any part of the world. Those hands, which may be deprived of business by the cessation of commerce, may be occupied in various kinds of manufactures and other internal improvements. If by the necessity of the thing, manufactures should once be established and take root among us, they will pave the way, still more, to the future grandeur and glory of America, and by lessening its need of external commerce, will render it still securer against the encroachments of tyranny.

In The Farmer Refuted, Hamilton provides a much fuller discussion of how the colonies can live without British manufactures.  He specifies the resources available, demonstrating a startlingly detailed understanding of the strengths of different regions of the country. In addition, he stresses the complementarity of these strengths, implicitly attacking the tendency toward sectionalism which persisted. He starts with these remarks:

Nature has disseminated her blessings variously throughout this continent: Some parts of it are favourable to some things, others to others; some colonies are best calculated for grain; others for flax and hemp; others for cotton; and others for livestock of every kind: By this means, a mutually advantageous intercourse may be established between them all. If we were to turn our attention from external to internal commerce, we should give greater stability, and more lasting prosperity to our country, than she can possibly have otherwise. We should not then import the luxuries and vices of foreign climes; nor should we make such hasty strides to public corruption and depravity.

He then goes on to discuss how land can be allocated to produce products such as wool, flax, and cotton. Means of transportation can be developed and employ numbers of people. Immigrants are available to start up new manufactures and more will come. Whatever holes will exist in production can be filled through goods from France and Holland, since it would be impossible for Great Britain to totally block up the ports. Rather they would have to resort to arms, and Hamilton is convinced that their victory is unlikely. Despite their discipline and military skill, the British will face a larger force and “that animation, which is inspired by a desire of freedom, and a love of one’s country, may very well overbalance those advantages.”

The site of Hamilton’s Society for Useful Manufactures at Passaic Falls, New Jersey

Although far from equaling the argumentation of the 1791 Report on Manufactures, Hamilton’s extensive discussion in 1774-75 of how the American colonists can develop the manufactures which will support the nation, even without exporting to Great Britain, or importing her manufactures, shows that he was developing this vision even before hostilities broke out. This prospect was to get more and more pressing as the war ground on. It played a vital role in shaping Hamilton’s input into the creation of the Constitution, with its significant powers over the economy, as well as his conduct as Treasury Secretary.

Faced with determined resistance to his vision from all sides – the Jeffersonians, some leading Northern bankers and merchants, and the British themselves – Hamilton had to fight for his manufacturing perspective for the rest of his life.  He had some success, establishing the Society for Useful Manufactures in 1791,

(This became the city of Paterson and formed a significant manufacturing hub throughout the 19th century.), recruiting some individuals from Europe to start industries, and establishing the armories, which were pioneers in engineering advances.

His policy outlook was tragically crippled for the first two decades of the 19th century, but it has kept coming back.

The Hamilton statue at the Paterson Great Falls Park.

Good ideas never die. Hamilton’s economic principles once led us to achieve the very “grandeur and glory” which he anticipated.  It is my hope that they will do so again.


Tags: , , , , , , , , ,