Pros And Cons Of The National Debt

Alexander Hamilton’s goal was to create a stable economy. He was concerned with the public credit of the United States of America. It was found that United States of America had debts amounting to $54 million from the Revolutionary War, $10 million of which was owed to wartime ally France and Dutch bankers. He proposed an economic plan that would solidify the economic structure of the country. Hamilton believed that the public debt assumption of all the states would be “the powerful cement of our Union” if his bond proposal that would improve the national public credit was be accepted. A bond is certificate issued by a government or company promising to pay back borrowed money at a fixed rate of interest on a specified date. He stated that all war bonds from the Revolutionary War must be paid in full at face value to those holding the bond agreements. He felt that if the repayment of war bonds was not taken solemnly or if only a fraction of the face value was paid, the government would lose the confidence and loyalty of the people. He felt it was imperative that the people confidence in the new system of government. To raise money to pay off the debts, Hamilton proposed the option of new

3. What was Hamilton’s plan for debt reconciliation? Hamilton suggested funding the debt by selling government bonds, and further proposed that state debts be assumed by the national government. Why was Madison opposed to it? Madison believed that Hamilton's plan "was betraying the ideas of the American Revolution."

In the book Hamilton’s Blessing, Gordon uses economic history and theory to explore the start, rise and decline of the United States debt. Gordon opens his book by stating that this country was born in debt, and this debt has become so high that concerned individuals no longer think of it. Throughout the book, he traces the history of the national debt dating back from 1791, when the central bank of the United States was created, up to modern days. The intellectual architect of this creation was Alexander Hamilton, the first Treasury Secretary as well as a central figure who had a deep impact on the economic development of the United States. The title of the book clearly recalls Hamilton's statement that a national debt, "if not excessive,

After the Revolutionary War the economy was not thriving. Paper money that had issued during the war was basically worthless, and there was a debt. These issues needed to be resolved and James Hamilton was the man whose hands this task fell on. Hamilton's plan was to retire old obligatuons and to borrow money at a lower interest rate. Hamilton proposed that teh government take all of the debt of the federal government and all the states. Many states that had already paid off their debts did not understand

Hamilton was appointed by President George Washington as the first Secretary of the Treasury Department. Hamilton was a Federalist and wanted a strong central government which means it should have more power than the states. Hamilton believed in a loose interpretation of the constitution which means the document allowed everything if it did not forbid. During the French Revolution, Hamilton supported and was an ally of Britain. Hamilton wanted elite rule America. The Federalist Party would be one of the “rich, the able, and the well-born” (Foner, Give Me Liberty, I, 295) as Hamilton stated. Hamilton favored a close relationship with Britain and he wanted America’s economy like Britain where trade and manufacturing were priorities. Hamilton desired to develop the economy and financial stability of the United States, so he established an economic five-program in 1790 and 1791. The first part was to establish the new nation’s credit worthiness which means people

The Budget and Economic Outlook: Fiscal Years 2010 to 2020. N.p., 2010. Web. 18 Jan. 2014. .

Financial Problems Hamilton's plan a. In 1790 Hamilton proposed that the new government pay off the millions of dollars in debts owed by the confederation government to other countries and to individual american citizens. b. The states had fought for nation's independence. C. Hamilton also believed that federal payment of state debts would give the state's strong interest.

Since we normally think of the “federal debt” as something bad, why did Hamilton think of it as something good and necessary for national welfare?

Although the national debt seems outrageous and out of control, currently standing at over $20 trillion, Alexander Hamilton considered national debt to be a blessing rather than a curse. In the First Report on Public Credit, Hamilton is quoted as saying, “…Persuaded as the Secretary is, that the proper funding of the present debt, will render it a national blessing.” The three-point process that Hamilton implemented catapulted the United States from an agrarian based society to a world power almost immediately. If Alexander Hamilton had not had a worldwide, economic grasp on the United States’ finances, America could never have become the great nation it is today.

After the American Revolution, the American economy was in financial chambles because of the debt that was created due to the war. Under the new constitution, Alexander Hamilton was appointed as the secretary of the treasury. Knowing the repercussions of how national debt would prevent America from earning the status of a world power like Great Britain, Hamilton urged for a bold proposition that would pay the debt at face value which was highly effective since the debt was paid fully almost two decades later. That was part of his 3 reports that would help the american economy. The institution of a national bank was the second report, he wanted to create a influx of the money supply by issuing out federal bank notes. His final report was about raising government revenue and was established by placing high tariff on imported goods to ensure the stable stream of income for the federal government and to boost the growth of the American

Hamilton believed that the new government needed the help of the aristocracy, and in order to get the support of the elite of society, the elite would have to be given a part in the success. Hamilton’s program was mainly composed of three objectives. It involved having the government take the responsibility of the public debt (born due to the revolution), take the debt of each individual state accumulated also during the revolution, and create a national bank. Hamilton’s goal was not to pay off the national debt, but to maintain a permanent, large national debt. Bonds would be issued by the government that would be paid by new bonds and those bonds would be paid by newer bonds and so on. This would prompt the wealthy gentry to lend money to the government knowing that they would be paid back, and keep them investing because they now needed the new government to survive. The national band would introduce loans and more business. In addition to this, the national bank would introduce two new types of taxes: the distillers of alcoholic liquors tax and tax on imports. This new program caused a lot of controversy. The ideas of having the government take on each individual state’s debt unsettled some citizens. Say for example that New York’s debt was greater than Rhode Island’s; if the government took both their debts and paid them off with taxes,

Throughout George Washington's term as president he was faced with many difficult decisions such as choosing a strong federal government or a weaker version which led most of the responsibilities to the people. He was often faced with these two proposals since The first secretary of state Alexander Hamilton believed in a strong national government, while the secretary of state Thomas Jefferson believed in a lesser centralized government. These opposite point of views will shape America and form the economy we have today. Alexander Hamilton took most of his influence from Britain and only wanted to better shape America just how Britain was prospering due to the country manufacturing and selling goods.

In the year of 1790, Hamilton suggested that the newly made government should pay off the millions of dollars in debts. Why you ask there are so many debts? Well, the Confederation government, and to some individual American citizens there were debts to be owed. Paper money back then was worthless, and foreign credit was not available to them. Even though later on, Congress agreed to pay off the money owed to other nations, Hamilton’s Plan on the other hand caused lots of protest among the American citizens. Hamilton believed that federal payment of the state’s debts would give the states a big interest in the success of the national government. In order to win support for his plan, Hamilton made a compromise with Southern leaders, the leaders

We hear about the debt almost every day: news talks about it, politicians argue about it, even President Obama gives speeches on it. So what is the significance behind it? In this article I am going to explain briefly what the national debt is, how big it is, and what it has to do with us.

When a government’s spending exceeds its revenues causing or deepening a deficit it is called deficit spending. Deficit spending is only one of numerous tools used to help manage the economy. Deficit spending is presumed to stimulate consumer demand by helping the consumer to obtain more money to spend, in turn, the demand of product will rise. There are advantages and disadvantages to deficit spending that we will discuss further below.