William Hogeland is the author of the narrative histories “Declaration” and The Whiskey Rebellion. He is also the author of the book Founding Finance: How Debt, Speculation, Foreclosures, Protests, and Crackdowns Made Us a Nation”. His blog is Hysteriography. Follow him on Twitter @WilliamHogeland
This interview was conducted by Nathan Tankus, a writer in New York City. Follow him on Twitter @NathanTankus
Nathan Tankus: Let’s begin with the basics, who was Alexander Hamilton?
William Hogeland: To us — why we care — Hamilton was the first Secretary of the Treasury and the architect of the comprehensive plan of finance that established the United States as a viable nation. He had an interesting background — he came from the colonial British West Indies, was born out of wedlock (a distinct disadvantage then), abandoned by his father and then orphaned by his mother. He didn’t “come from nothing,” as some romantically describe him: he grew up at first on inherited property; his mother had a store and other property including enslaved Africans. Hamilton would have had a modest inheritance, but the court gave it all to his mother’s husband, the man she’d left for Hamilton’s father. So he had to go to work as a teenager in an trading firm and blew everyone’s mind with his efficiency and brains. He was always like that. He had sponsors who sent him to New York, where he trained himself incredibly fast to get into Columbia. On George Washington’s staff during the Revolution, he became a de facto chief. He married into the Schuylers, one of the most elite of elite New York families. A very appealing story, and an intense personality.
NT: What was his relationship to George Washington during the Revolution?
WH: Washington and Hamilton had a highly fraught relationship. During the war, Washington depended on Hamilton as a key staffer, so he kept frustrating his protege’s intense desire to join in the actual combat. At one point they had an actual blowout over the issue in front of other officers. In private letters, Hamilton ran Washington down, questioning the chief’s ability as a general and so forth; he sometimes liked to present Washington as seeking a deeper friendship with him than Hamilton wanted to have, but I think that was pretty much just preening. These attitudes were worrying to Hamilton’s father-in-law and mentor Philip Schuyler, who was a great supporter of Washington, but it was part and parcel of Hamilton’s character, even from a young age, to be impatient with any restraint and excoriating in his opinions.
Then, after leaving the army and entering the Continental Congress, Hamilton courted Washington, by letter, to get involved in a scheme to threaten the Congress with a military coup unless it passed a tax that Hamilton and his finance mentor Robert Morris wanted to use to fund interest payments to a small number of wealthy investors in the war debt. Washington was totally aligned with their finance goals. But he declined to involve himself in what he began to see as a very dangerous scheme. Weirdly, as Hamilton confessed some of his own involvement in the plot, and covered some of it up, Washington’s relationship to Hamilton became closer. They came to depend on each other to bring about major projects in the early federal period.
NT: Expand on that point: why did they threaten Congress with a military coup and why was it necessary in their minds?
In the later days of the war, the high-finance types that Hamilton saw as critical to the strength and greatness of an independent America were getting worried that the domestic war debt — multiple tiers of state and federal war bonds they’d invested in — would never be funded with regular interest payments, and might even be wiped out completely. They weren’t wrong. Ordinary people, non-bondholders, were agitating within the states for radically discounting bond payouts to face value and equalizing burdens and payoffs.
What Hamilton, Morris and others wanted to do is to assume all this debt as a federal responsibility — centralizing the relationship of government to wealth — and reliably fund it. People writing about Hamilton recently seem unable to face this fact, which he cogently explained: he worked hard (Madison did too!) throughout the 1780’s to swell the federal debt, not reduce it. He, Washington, Madison, and Morris were nationalists, and they knew that great nationhood is possible only if it has access to a concentration of wealth. Anyway, before there was a nation, they had no power under the Articles of Confederation to directly tax people in order to fund these bonds, so they tried to get Congress to alter the Articles and pass such a tax, an impost on foreign goods. This proposed impost was only a wedge: after people got used to it, Morris said, Congress could start passing other tax laws, collecting money earmarked for bondholders’ interest (tax-free, of course) from people who would never own a bond and “open the purses of the people,” as Morris put it, really concentrating wealth upward. Some states saw what they were up to — Rhode Island, mostly — and refused to pass it. Meanwhile, with peace in the offing, the nationalists saw all unity about to dissolve. States might start to pay off or fund their own debt instruments. The whole national hope would crumble.
But the army’s officer class had not been paid what it was promised — a fact due partly to Morris’s preference for paying investors over soldiers! — and so the nationalists saw a chance of joining military force to wealth and forcing Congress to pass the impost for funding the bondholders. What if the troops simply refused to lay down their arms unless the officers — and crucially, to Hamilton and Morris — the bondholders were funded? Controversy about this episode — it’s called the Newburgh Crisis, because Washington’s army was then at Newburgh, New York — centers on the extent to which Hamilton and Morris envisaged possibly carrying out a real coup, in partnership with certain officers, or whether they just wanted to scare Congress with the idea of coup. Either way, it’s Hamilton’s first entry into politics, and it set him on a fairly startling trajectory. Nobody can say he didn’t have guts.
NT: That is amazing. What is the fallout of the crisis for him? how did he manage to become the first Treasury Secretary of the United States after what easily could be construed as treason?
WH: Nobody involved was openly accused of treason. These were Washington’s friends and political allies in nationalism. Washington was infuriated by their dangerously bonehead tactics — he thought they’d put the whole nationalist program at risk — but he stayed friends with Morris, and it was now, strangely enough, that he and Hamilton began working more closely together. Almost everybody calls the Newburgh conspiracy a failed threat of coup, but I think it was largely successful. After shutting down an attempted officer coup by his hated enemy Horatio Gates — Hamilton shrewdly never admitted to Washington that the conspirators had reached out to Gates! — Washington himself wrote to Congress, described the coup he’d just shut down, and demanded that the officer class be added to the bondholding class, which Congress instantly did. That created a new concentration of wealth in military power, the strongest lobby of all. When the time really did come to fund the debt, when Hamilton was Treasury Secretary, the table had been set. Hamilton took huge risks in the Newburgh crisis, and they all paid off.
NT: I’d like to focus in on something you just said: “Washington himself wrote to Congress, described the coup he’d just shut down, and demanded that the officer class be added to the bondholding class, which Congress instantly did. That created a new concentration of wealth in military power, the strongest lobby of all.”. Many say one of the greatest victories of the Revolution is that we avoided a military junta. Do you think this is as true as commonly believed?
WH: I think it’s manifestly true that the country did not come to be ruled by a military junta. The armed forces remained under civilian control. That’s something to be happy about.
During the revolution, however, Washington, as commander, was arguably the most powerful person in the country; second or maybe nearly equal to him was Robert Morris, and I think the combination of of military power and high-finance power played a far stronger role in establishing nationhood than is commonly recognized. I mean, how wouldn’t it? That’s part of what a nation was — a concentration of power in wealth and military strength. When it comes to Hamilton himself, while he could always talk the Whiggish talk, I think he was always romantically drawn toward military derring-do and felt frustrated by the structures of civilian control. When he led 19,000 troops into western Pennsylvania to occupy it in the 1790’s, he paid no attention to legal restraints on using military force on the citizenry. The troops brought along a federal judge, but the judicial power was explicitly subordinated to military authority, and Hamilton oversaw roundups without warrants, indefinite detentions without charge, loyalty oaths extracted by soldiers.
Here again we see the weird symbiosis of Washington and Hamilton. The President approved all that stuff. And yet he turned back before the troops got into the west; he left Hamilton in charge, the tough guy who takes the historical blame. So no, we did not get a military junta. But some important figures in the Federalist era were the first in U.S. history to flirt, at least, with militarism, and I see Hamilton as foremost among them.
NT: What did Hamilton do after the Revolution? how did his experiences in the immediate aftermath inform his and other “founding fathers” views of the articles of confederation?
WH: He practiced law in New York and worked hard to get the country turned into a nation. It’s commonly said that the Articles were weak. The more important point is that they acted only on the member states, only within the context of their common goals — administering the war, then administering the Northwest Territory, etc. A real nation would pass laws acting directly on all citizens throughout the states — like a real impost, and like an excise, earmarked for paying bond interest. To get the high financiers paid, to put down populist rebellions for democratic finance, to assume all state debt into the federal debt, to stop the states from printing paper currencies that devalued creditors’ often predatory investments in private debt, to form a nationally controlled regular army to expand U.S. sovereignty and investment into Indian country north and west of the Ohio River, would take national power, and Hamilton was important in getting the Constitutional convention going.
NT: Many on the left seem to be in love with Hamilton, or at least see him as the “best” of the founding fathers. An example of this kind of left revisionism comes from Christian Parenti in this piece in the left magazine Jacobin:
In the face of these changes, Hamilton created (and largely executed) a plan for government-led economic development along lines that would be followed in more recent times by many countries (particularly in East Asia) that have undergone rapid industrialization. His political mission was to create a state that could facilitate, encourage, and guide the process of economic change — a policy also known as dirigisme, although the expression never entered the American political lexicon the way its antonym, laissez-faire, did.
What do you think of this vision of Hamilton?
WH: It sort of depends on what you mean by “left,” and nobody will ever agree on that. Obviously Hamilton was no laissez faire economic libertarian, and he was a kind of liberal-capitalist proponent of active government management of the national economy, so certain kinds of liberals and conservatives alike naturally hold him in high regard. On that spectrum are those who take Hamilton’s personal upward mobility as a sign of his commitment to upward mobility for all, which I find fantastical. There were Soviet managerial planning types who might have admired Hamilton’s way of doing business, if you think of them as left. And he was militaristic, unabashed abut using state power to crack down on dissent without regard for law, and there certainly have been left regimes that might relate to that.
But in terms of goals we might more seriously imagine a modern American left endorsing — equality, democracy, restraining the power of wealth in government, fostering labor over capital — that’s not Hamilton. It’s not Jefferson either. Parenti’s argument struck me as a fairly typical liberal argument in favor of Hamilton, and not very informed by the real purposes and beneficiaries of Hamilton’s policies for concentrating American wealth, but I don’t understand why some on the left keep looking for heroes in the founding generation. People keep trotting out this tired Hamilton-vs.-Jefferson binary, picking one guy over the other to hold up, this week, as a founding model, and then fighting about who’s more proto-left. It’s been going on for generations. There’s nothing there.If the left is seeking figures in the founding generation, look at Thomas Paine, Herman Husband, James Cannon, Thomas Young, e.g. They had issues too, of course. But at least their careers have something to do with the history of the American left.
NT: Was Hamilton an abolitionist or “anti-slavery”?
WH: Hamilton opposed the institution of slavery, both personally and in his policies, which promoted a national economy driven by industrially organized labor, urban and rural. That was in opposition to the agrarian vision of Jefferson, which lauded the white yeoman freeholdiing farmer, and was in fact based on a plantation economy reliant on the labor of enslaved black people; unlike Washington, say, Jefferson never even seriously considered freeing his slaves. That makes Hamilton a far more appealing founding figure than Jefferson.
But it’s a far cry from the abolitionism that some of Hamilton’s biographers — most recently Ron Chernow — claim for him. I think usually we mean “abolitionist” to refer to those who pushed to eradicate the institution nationally, by law. That wasn’t Hamilton, putting it mildly. As a nationalist eager to get the Constitution signed, he naturally supported the three-fifths clause that effectively wrote slavery stubbornly into the national founding, over and against petitions by Quakers whom we might more accurately call abolitionist of their day. He did belong to the New York Manumission Society, which worked to get slaveowners in New York to free their slaves and pushed for a law for gradual abolition of the institution in the state. It should be noted, for clarity, that slave ownership was no bar to membership in the Manumission Society. Many in both the North and the South had concerns, no doubt sincere, about the vileness of the institution; many of those same people nevertheless held slaves. Hamilton fans assert that Hamilton himself never did, but the record suggests otherwise to me. There’s a note from Hamilton to George Clinton arranging payment for “the woman Mrs. Hamilton had of Mrs. Clinton”; other letters show Hamilton arranging slave transactions for relatives. Such was the national pervasiveness of the institution, lest we forget. Making Hamilton an abolitionist who recoiled from ever dealing with such things is wishful thinking that I think helps us forget.
NT: Much is made of the fights between federalists and anti-federalists. Could you talk about how much they fundamentally agreed on?
WH: When the 1787 meeting opened, which became the Constitutional Convention, I think pretty much everybody in the room was agreed that something had to be done specifically to end the populist movement for democratic approaches to finance, which was undermining the likelihood that the bondholders would ever get paid. At least that’s what Edmund Randolph said they should be addressing, when he called the meeting to order. The delegates believed the only way to assert the claims of the interstate elites was to now form a national rather than a confederated government: the state legislatures had shown themselves just systemically too weak in resisting democracy. Some who were just as concerned about the threat of democratic finance stayed away from the convention: Patrick Henry was no populist, but he saw that Virginia would lose sovereignty in a national context, so he couldn’t endorse where he saw the convention going. But generally what the parties that became “federalist” and “antifdederalist” disagreed on was how to structure a national government and how much power it should have vis a vis the states (Hamilton wanted to eradicate the states completely, make them departments of the federal government). Those differences became deep, stark divisions; they’ve messed us up ever since. Still, the popular movement for democratic finance had done the near-impossible: bringing together American elites with nothing in common except the desire to crush the popular movement.