Hamilton's Scheme
I blurbed William Hogeland’s brand-new that came out on Tuesday, May 28, book: The Hamilton Scheme: An Epic Tale of Money & Power in the American Founding <https://www.amazon.com/dp/0374167834>. Buy it! Read it!…
I wrote: “America’s exceptional wealth relative to other North Atlantic economies is, to a remarkable degree, Alexander Hamilton’s creation. And so is America’s remarkable tolerance for high inequality. William Hogeland is the best guide I have found to understanding how we today are, for good and evil, children of Alexander.”
That is 100% true.
So now I have one ask to make of you: Go and read The Hamilton Scheme: An Epic Tale of Money & Power in the American Founding <https://www.amazon.com/dp/0374167834>.
Then come back.
I will wait.
At the end of Part IV of his The Hamilton Scheme, Hogeland writes that Alexander Hamilton’s actions as Washington’s Treasury Secretary had made sure:
the Democracy… had been truly demolished at last…
What is this “The Democracy”?
Start with with the Great Peasants’ Revolt of 1381 during the reign of King Richard II Plantagenet . John Ball had been imprisoned for ‘heresy” in Maidstone, Kent. The Peasants’ Revolt washed over and released him. He then preached an open-air sermon at Blackheath:
When Adam delved and Eve span, who was then the gentleman? From the beginning all men by nature were created alike, and our bondage or servitude came in by the unjust oppression of naughty men. For if God would have had any bondmen from the beginning, He would have appointed who should be bond, and who free. And therefore I exhort you to consider that now the time is come, appointed to us by God, in which ye may (if ye will) cast off the yoke of bondage, and recover liberty…
Where Ball says “delved” we would say “dug,” the past of dig. Where Ball says “span” we would say “spun”, the past of spin. For “of naughty men” we would say “by evil and empty men”. But the message is clear: all—not just men: Eve is in there too—were created equal and should be equal, and are not equal only because of injustice perpetrated by the evil and worthless.
John Ball—Froissart’s “Mad Priest of Kent”—was not popular among the élite of 1300s England. He was put on trial, where by virtue of his status as a priest he was actually permitted to speak in his own defense. King Richard II Plantagenet himself presided over his execution on July 15, 1381 at St. Albans. He was hanged, drawn and quartered. His head was stuck on a pike on London Bridge. The four quarters of his body were displayed at the four corners of the 200- by 150-mile diamond of Coventry, St. Albans, Norwich, and York. Sources do not tell me which quarter was sent where.
John Ball, Wat Tyler, and the other leaders of the 1381 Great Peasants’ Revolt were to a large degree a new thing, at least in English history. The idea that the realm was divided between those who prayed, those who worked, and those who fought and governed—and that movement from one category to another was next to impossible—was by 1381 well past its sell-by date. You were not, overwhelmingly, born to be what your father or mother had been: slave, serf, churl, franklin, merchant, cleric, knight, lord, or king. You were, instead, a man like other men, finding your place in the societal division of labor by using your resources to make yourself useful to counterparties and making bargains and contracts that could be revised when needful.
And one of those bargains that could be revised when needful was the social contract.
The barons had, after all, bargained with the king at Runnymede in 1215 and won Magna Carta. If the Mediæval Catalan oath to their count had never been “We, who are worth as much as you, take you as our king, provided that you preserve our laws and liberties, and if not, not”, people in the Renaissance firmly believed it had. The peasants of 1381 thought that they could do the same. For God was on their side. After all, when Adam delved and Eve span, who was then the Gentleman?
They could not do the same.
But their ideas grew.
And eventually these truths were held to be self-evident:
that all men were created equal.
endowed with inalienable rights.
among which were life, liberty, and the pursuit of happiness.
with government instituted to secure these rights.
with government deriving its just powers from the consent of the governed.
In The Hamilton Scheme, “The Democracy” was a radical populist movement that takes these seriously, at least for white settler guys. It held the flowery words at the start of the Declaration of Independence thought it thought it could cash. And so The Democracy sought to achieve greater political and economic equality for the American white, male and settler—not Black, female, or Amerindian—working class: against élite control, and for more inclusive and equitable governance, for white settler guys.
In The Hamilton Scheme, “The Democracy” hates taxes, hates banks that want money paid back at high interest rates, hates the fact that the Revolutionary-War state bonds that they had sold to bond dealers for a song are going to be honored by Alexander Hamilton’s Treasury Department at full real value, hates the failure of a federal government and a Pennsylvania state government that takes their taxes and does not do enough either to protect their existing farms from Amerindian raids or to push out the Amerindians so they can establish more farms. The Democracy does not consent, and thinks that their lack of consent means something—no matter what machinations in earlier years and back east had produced referendums with majorities for a constitution under which Hamilton is Treasury Secretary, and in which those in Philadelphia in New York who are supposed to represent them wind up instead listening to and representing the interest of eastern urban bankers, want-to-be monopolist merchants, and insider traders.
The Democracy saw itself as empowered to protest, and maybe to hint at doing more if their protests did not persuade the government to change course—to threaten to “appeal to heaven” as Supreme Court Justice Alioto might say, if the Congress insisted that Joe Biden had won the 2020 election just because he had a majority of the valid electoral votes submitted under the procedures set out in the laws of the fifty states. Organize a local militia for self-defense, but leave it a little vague as to against who. Remembering the “Committee of Privates” that had overthrown the government of Pennsylvania Colony in 1776.
Washington and Hamilton hated The Democracy.
Madison, casting a very wary eye on events in France after 1789, hated it as well.
Jefferson… Jefferson combined private disapproval of the federal government’s military suppression of the so-called Whiskey Rebellion, philosophical endorsement of occasional rebellion as a check against governmental overreach, substantial public silence, and a great fear that he might have a difficult time ascending the political ladder if his ability to form coalitions was damaged by too close an association with the Committee of Public Safety vendors of the guillotine and their corrupt Directory successors in France.
Gallatin—Gallatin came very close to denying the existence of anything within light-years of what the Whisky Rebellion was made out to have been, and tied himself to the mast that nobody serious in America would have such a contempt for private property as to adopt the platform of Solon, Cleisthenes, and the Gracchi of seisachtheia: “abolish the debts and redistribute the land”.
The Hamilton Scheme adds The Democracy to the political players of America in the 1790s, as—no surprise—the schemes of Alexander Hamilton are getting underway. Hogeland notes that:
General readers of U.S. history have gotten used to defining the essential American conflict in terms of… Hamilton and Jefferson…
Indeed it does. And it is not wrong to do so. E.H. Halliday:
Before they had finished their service as cabinet officers, Jefferson was calling Hamilton (in a letter to Washington) “a man whose history… is a tissue of machinations against the liberty of the country”; and Hamilton was calling Jefferson (in a newspaper piece) “the promoter of national disunion, national insignificance, public disorder and discredit”…
But Hogeland wants to focus elsewhere than exclusively on the Hamilton-Jefferson war:
Stressing… “the Democracy”… raises questions about that binary’s long-standing primacy in common understandings of U.S. founding politics…. Hamilton and Jefferson did… have divergent ideas of… American prosperity…. Hamilton’s purpose was to consolidate public and private high finance, via a powerful administrative state, to promote national industrialization and make both manufactured and agricultural goods domestically, at a big scale…. Jefferson did prefer a less centralized and—at least at first, and philosophically, anyway—a more agrarian society… link[ed]… philosophically with a smallholding yeomanry…. Within the governing class of the founding generation, the differences became existential, zero sum. Hamilton and… Madison, especially, went through a painful breakup…. But take for a moment the point of view of the free-laboring many and the Hamilton and Jefferson groups, so deafening in mutual vituperation, collapse into a small hegemony forever bickering over how best to exploit the free majority, as well as the enslaved, and control and distribute the fruits of labor…
That is where Hogeland starts from: The premise is that both Hamilton and Jefferson are, in reality, old-school society-of-domination élitist wolves wearing modern democratic sheep’s clothing. Their principal goal is the old goal of those who find themselves at the top of a society of domination: to get enough for themselves and their families by taking advantage of the fact that grain is easily, stolen, that farmers and their families cannot easily run away from their plots, and that twenty guys not protein-deprived in utero and childhood with enough wealth to buy and enough leisure to train with a full panoply can make a very good living indeed by controlling a thousand peasants.
In Hogeland’s view, Hamilton wants to sit on top of a market-capitalist commerce, banking, and manufacturing domination-and-exploitation scheme working primarily by fraud and secondarily by force.
In Hogeland’s view, Jefferson wants—at least initially—to sit on top of an agrarian slave, hiring, and landlord domination-and-exploitation scheme working secondarily by fraud (an identity of interest of some sort between small landowners who are virtuous because they work the land with their hands and large landowners) and primarily by force. (We can meditate on the idea, running from Cato the Elder down through Jefferson and beyond, that the large landowners, those who master those who work the land with their hands, drive them with the whip, take their stuff, somehow also share in the actual farmers’ virtue.)
But, in Hogeland’s view, recognizing as he does that The Democracy of the 1790s was, as we say today, “deeply problematic”:
The white working class… white… men… seeks political and economic equality for white men…. Attitudes toward enslaved black people… the Shawnee, Delaware, and other woodland nations, white people across all social classes are most often flat-out bloodthirsty, at best brutally patronizing…
But there still was a sense in which Jefferson could have allied with The Democracy and made a better world. But the REVOLUTION WAS BETRAYED!:
[Because of] Madison and especially to Gallatin, relations between the Jeffersonians and the white working class grow fraught, in ways that have baffled our history and civics down through the centuries…. This book’s reviving… the Morris-Hamilton-Gallatin arc… the all-important impact of the Democracy… a narrative realism not often found…. Characters rarely seen in the Hamilton context. Thomas Paine… James Cannon… William Findley…. Hamilton will try to get both Findley… and Gallatin… arrested and hanged on trumped-up charges…. He’ll fail with both. Findley, born an outsider, lives to become the longest-serving member of the House and will die at home at the age of eighty…
In a way, Hogeland is an anti-federalist. He thinks a less Hamiltonian America with more powerful and more autonomous individual states would have been more susceptible to popular pressures and democratic movements. “Populist” pressures, yes. Bot “popular and democratic” in the sense of majority rule, equal suffrage, and democratic rights? I know of no African-American except (possibly) Clarence Thomas who would agree. Hogeland sees an America in which more autonomous state governments respond to ordinary citizens pushing for the issuance of paper money, debtor relief, and a general tilting of policies toward, if not abolish the debts and redistribute the land, inflate away the debts and sell-off land in small parcels as cheap homesteads. And that definitely was not the America that Hamilton wanted to see.
Hamilton truly did envision the United States transforming from an agrarian economy, heavily reliant on exporting raw materials and importing finished goods, into a robust manufacturing powerhouse capable of rivaling Britain. This transformation was to be driven by rapid industrialization, characterized by large-scale manufacturing, mechanization, and the establishment of a manufacturing economy throughout the country. The Bank of the United States, the assuption of state debts, funding via excise, government-chartered factories, support via tariffs, subsidies and infrastructure for domestic manufacturing, plus industrial espionage against Britain were all parts of the Hamilton Scheme.
And then Hamilton fell out with Adams. And then the 3/5 clause votes of Jefferson’s slaves gave the southern states a predominance of electoral votes: 1800 was the first election in which the electoral-vote winner had lost (or, rather, would have lost) the popular vote of a one man-one vote white citizen electorate.
But Jefferson in power clung much more closely to Gallatin and Hamilton than he did to his own much-honored-in-the-breach egalitarian and democratic commitment. Madison feared Jacobin-like mob rule. Gallatin saw the American farmer as too virtuous to even think of wanting the government’s thumb put on the scale against private property, however concentrated. The independent, pioneering smallholder who, provocation, would remain humane and reasonable, possessing an exceptional character that distinguished him from members of a European mob. Gallatin and Madison thus sidelined the more radical democratic impulses that had been present in the early republic more effectively than Madison had.
And, in power, the former Jeffersonians saw how very useful Hamilton’s instrumentalities could be.
In power, Gallatin realized that Hamilton’s financial system was intricately designed and highly functional. Operational stability was his watchword. A full-fledged Jeffersonian government would have been unable to resist the encroachments of the British Empire. And so, especially after the ex-Jeffersonians decided to wage the War of 1812, they needed the bank, the debt, customs if not excise, and to wring dry the source of revenue that was land sales.
By 1811 it was clear to Gallatin that he needed the Bank of the United States. He failed in recharter in 1811. He succeeded in 1816.
Not just “The Democracy” but Jeffersonian Agrarianism was dead. It had become Neo-Hamiltonian Industrialism
Now Hogeland is not wrong in his portrayal of who Hamilton was. Again, E.H. Halliday:
Hamilton’s dream focused primarily on economic development… manufacturing… merchandising… commercial enterprise aided by a strong central government and appropriate legislation… run by a powerful elite consisting of the wealthy, well-educated, and privileged…. A constitutional monarchy would have been preferable to a democratic republic…. The ability of common people to make the right choices on matters of national policy was feeble…. Shortly before his death in 1804 he wrote to a friend that what really ailed America was “the poison” of democracy…
But Hamilton was more than a crypto-monarchist society-of-domination wolf in revolution-and-constitution “national greatness” democratic sheep’s clothing. For one thing, America was not a society-of-domination caught in a Malthusian trap. It was, from its founding, something else. In an economy both commercial and Malthusian, protecting property at the point of a spear really is just a more clever and more efficient way of running a society-of-domination for the benefit of the propertied élite than is extracting the harvest at the point of a spear for the benefit of the military-bureaucratic élite. But since the American economy was never Malthusian, “national greatness” was not just part of the fraud part of the force-and-fraud exploitation-and-domination machine, Hamiltonian “national greatness” created a great nation. I said and I meant both parts of: “we today are, for good and evil, children of Alexander.”
I confess I find it much harder to find something good to say about Jefferson, that slavemaster wolf in democratic “rights of man” sheep’s clothing. The fact that he halfway and his successors Gallatin and Madison adopted Hamilton’s scheme in the end says what needs to be said about the Hamilton-Jefferson struggle.
Could Jefferson have done more to empower true democracy?
The odd thing is that, viewed in the long-run, Jefferson did do the most important and powerful of the things he could have done to empower true democracy.
I have sworn upon the altar of God eternal hostility against every form of tyranny over the mind of man…
We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain inalienable rights, among these are life, liberty, and the pursuit of happiness, that to secure these rights governments are instituted among men. We… solemnly publish and declare, that these colonies are and of a right ought to be free and independent states… and for the support of this declaration, with a firm reliance on the protection of divine providence, we mutually pledge our lives, our fortunes, and our sacred honour…
Almighty God hath created the mind free. All attempts to influence it by temporal punishments or burthens… are a departure from the plan of the holy Author of our religion.… No man shall be compelled to frequent or support religious worship or ministry or shall otherwise suffer on account of his religious opinions or belief, but all men shall be free to profess and by argument to maintain, their opinions in matters of religion. I know but one code of morality for men whether acting singly or collectively…
God who gave us life gave us liberty. Can the liberties of a nation be secure when we have removed a conviction that these liberties are the gift of God? Indeed I tremble for my country when I reflect that God is just, that His justice cannot sleep forever. Commerce between master and slave is despotism. Nothing is more certainly written in the book of fate than that these people are to be free. Establish the law for educating the common people. This it is the business of the state to effect and on a general plan…
I am not an advocate for frequent changes in laws and constitutions, but laws and institutions must go hand in hand with the progress of the human mind. As that becomes more developed, more enlightened, as new discoveries are made, new truths discovered and manners and opinions change, with the change of circumstances, institutions must advance also to keep pace with the times. We might as well require a man to wear still the coat which fitted him when a boy as a civilized society to remain ever under the regimen of their barbarous ancestors…
So go buy and read Hogeland’s The Hamilton Scheme! It is truly great! Characters as lifelike and as interesting as in Lin-Manuel Miranda’s Hamilton! But the stories are all true! (Albeit shaded differently and somewhat darker in the end than I would.)
References:
de Ste. Croix, G. E. M. 1981. The Class Struggle in the Ancient Greek World: From the Archaic Age to the Arab Conquests. Ithaca, NY: Cornell University Press. <https://archive.org/details/g.-e.-m.-de-ste.-croix-geoffrey-ernest-maurice-de-ste.-croix-the-class-struggle→.
Froissart, Jean. 1400 [1899]. The Chronicles of Froissart. Trans. John Bourchier, Lord Berners; ed. G. C. Macaulay. London: Macmillan and Co. <https://archive.org/details/chroniclesoffroi00froiuoft>.
Halliday, E.H. 1978. Understanding Thomas Jefferson. New York: Harper & Row. <https://archive.org/details/understandingtho00hall/>.
Hogeland, William. 2024. The Hamilton Scheme: An Epic Tale of Money & Power in the American Founding. New York: Farrar, Straus and Giroux. <https://us.macmillan.com/books/9780374167837/thehamiltonscheme>.
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