The creation of the first national bank in the United States was of utmost importance in setting precedence for how much power the constitution actually grants the government. The debate over whether to create a national bank raised many questions over the constitution that hadn’t been tested before. It also raised questions about what the government can do when the constitution has no written clause on a certain subject. In looking at the arguments from Alexander Hamilton, James Madison, and Thomas Jefferson regarding a national bank, people can find out more about how some of the leading founders of the Constitution wanted to see the United States government run.
The Bank of the United States was designed to make money and build an economy. It was designed by men like Alexander Hamilton and Robert Morris, but did not benefit the common citizen as much as wealthy investors. Why did a fledgling government need to borrow millions from overseas in order to invest in a “national” bank, to turn around and then borrow the same money back and pay interest on it? The banking system developed by Alexander Hamilton and Robert Morris was prime pickings for speculators, and laid the groundwork for a history of unscrupulous activity regarding our nation’s money supply that continues to this day. The signatures on the Constitution were barely dry before corruption and
While the popular party was in favor of using paper money to pay off debts, such as was done in Rhode Island, the upper-class patricians saw this as unacceptable. Since the Philadelphia Convention consisted of the conservative aristocrats (there was no representative from Rhode Island), paper money was outlawed and a national bank was set up. Although this may have been the fairest and most logical set-up, it was not a democratic plan because it did not uphold the common interests of the people.
During George Washington’s presidency of our new nation, there was a large disagreement between his Secretary of Treasury, Alexander Hamilton and his Secretary of State, Thomas Jefferson on several economic and political challenges.To get the nation out of extreme debt, Hamilton came up with a financial plan that included the creation of a national bank. This national bank would be a safe place to deposit government funds, a source of loans for the government and businesses, and the creation of a national mint. However, Jefferson was strongly opposed to the idea of a national bank, he believed it was strictly against the Constitution and would give the federal government too much power. Hamilton argued that Article I Section 8 of the Constitution
Hamilton’s creation of the first bank in the United States continues to exist in today’s economic environment. However, at that time Hamilton’s proposal was met with widespread resistance from individuals such as James Madison and Thomas Jefferson who considered the creation of a federal bank as unconstitutional. The analysis made by Gordon in his book is consistent with arguments made by to have a bank that would be effective in order to implement the powers authorized by the government as it was implied in the constitution
Out of all the obstacles that the federalists had faced, the economy was, by far, the most problematic and the most difficult to find a solution for all parties. The country was not in a very stable position because of the recent crises like the whisky rebellion, or money-producing ideas such as bonds. Hamilton, Madison, and Jefferson played major roles in establishing the economy of the United States at the time, and also had a large role in the development of today’s government and economy. Without the ideas of these men, the United States economy may have the same problems today that the federalists faced then. And in the end, even though the idea of a national bank was redundant, that is what removed the United States from
During the Jacksonian period of 1824-1848, America had great economic development that played a role in making this period known as the “common man,” live up to its expectations. The Bank War was one of Andrew Jackson's many attempts to lower the power of the federal government. The Bank of the United States was ran by Nicholas Biddle, and issued federal deposits, credit and bank notes. However, the main issue was that it restrained the power of state banks. The soft-money and hard-money were two groups, that opposed the Bank. The
The bank provided credit to growing enterprises, issued bank notes which served as a dependable medium of exchange throughout the country, and it exercised a restraining effect on the less well manages state banks. Nicholas Biddle, who ran the Bank, tried to put the institution on a sound and prosperous basis. But Andrew Jackson was always determined to destroy it (Brinkley, 249). The Bank had two opposition groups: the “soft-money” faction and the “hard-money” faction. Soft money advocates objected to the Bank of the United States because it restrained the state banks from issuing notes freely. Hard money advocates believed that coin was the only safe currency, and they condemned all banks that issued bank notes.
I, Thomas Jefferson, am against the bill for the adoption of a national bank designed along the lines of the Bank of England. The U.S. bank would prevent the improvement of state banks as a result of its exceptional powers and benefits. I think states ought to sanction banks that could issue cash. A national bank would be much more help to rich representatives in urban communities than to agriculturists in the nation. The national bank would be controlled by affluent investors and would assist those with privileged class turn out to be more rich and effective. The joining of a bank and the forces accepted by this bill have not, as I would like to think, been designated for the United States by the Constitution. I trust that the Constitution
The validity of President Andrew Jackson’s response to the Bank War issue has been contradicted by many, but his reasoning was supported by fact and inevitably beneficial to the country. Jackson’s primary involvement with the Second Bank of the United States arose during the suggested governmental re-chartering of the institution. It was during this period that the necessity and value of the Bank’s services were questioned.
In addition to saving the integrity of the Federalist-dominated Supreme Court in the case of Marbury v. Madison, John Marshall also promoted certain Federalist principles, including the idea of a strong national government. From the years when the Constitution was being created, Alexander Hamilton fought for the creation of a national bank since he believed it was “necessary and proper” for the growth and development of the United States (“The Marshall Court”). As Hamilton and the Federalist Party had hoped, a national bank was created and one of its branches was placed in Baltimore, Maryland. State legislators from Maryland were not satisfied with the progress the bank was making because the negligent behavior of its bank officials was bringing the bank under (Newmyer, 295). To save their citizens from having to deal with the bank’s faulty leadership, the legislators attempted to drive the branch out of the state by placing a tax on all the banknotes issued by the bank. When the tax was purposely left unpaid, Maryland sued the cashier of the bank--James McCulloch. In the state courts, Maryland won its case,
After the Founding Fathers ratified the Constitution, they realized that they had to deal with sixty-three million dollars debt that they owed to those who took part in the American Revolution. In order to pay back this debt Alexander Hamilton created a financial program. However, some Republicans such as Thomas Jefferson and James Madison thought that his plan was unconstitutional because one would need to use the necessary and proper clause which most people feared because it gave the government too much power. This, however, is not so Alexander Hamilton’s financial plan however was mostly constitutional because it allowed it to use the powers as well as responsibilities congress already had such as print its own form of currency, issue
One of Jefferson’s and Hamilton’s first disagreements began with the idea of a National Bank. Hamilton suggested that the government should create the Bank of the United States Jefferson protested because this was not allowed by the Constitution. Hamilton opposed the view of Jefferson and stated that the Constitution’s writers could not have predicted the need of a bank for the United States. Hamilton said that the right to create the Bank of the United States was stated in the “elastic” or the “necessary and proper” clause in which the Constitution gave the government the power to pass laws that were necessary for the welfare of the nation. “This dilemma revisits the ever lasting dispute between the “strict constructionists” (Jefferson) who believed in the strict interpretation of the Constitution by not going an inch beyond its clearly expressed provisions, and the “loose constructionists” (Hamilton) who wished to reason out all sorts of implications from what it said”. Just a few years later, under President Jefferson, the federal government of the United States
The First Bank of United States – 1791 to 1811. Mr. Hamilton urged Congress to adopt the model he had come up with, which included one national bank that would hold the federal government’s deposits and would lend to the government and business. Though there was much opposition, the proposal was accepted but the bank’s charter was given a 20 year limit. The bank, known as First Bank or Bank of United States, helped to bring the economy of the country together. However, it was a private institution where foreigners owned 70 percent of the bank and this concerned the citizens of the United States. When the charter was up for renewal it was rejected and the bank was closed in 1811. ("First Bank of the United States" 1-16)