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How Alexander Hamilton Shaped America, Part Two

TTBW 1222 Alexander Hamilton
PBS feed date 7/22/2004



Funding for Think Tank is provided by:


At Pfizer weíre spending over five billion dollars looking for the cures of the future. We have twelve thousand scientists and health experts who firmly believe the only thing incurable is our passion. Pfizer. Life is our lifeís work.


Additional funding is provided by the Bernard and Irene Schwartz Foundation, the Smith Richardson Foundation, the John M. Olin Foundation, and the Lynde and Harry Bradley Foundation.


(opening animation)


WATTENBERG: Hello, Iím Ben Wattenberg. Alexander Hamilton rose from poverty to become one of the most powerful men of the American revolutionary era. Some say he laid the foundation for todayís global economy. But as biographer Ron Chernow points out, Hamiltonís brilliance was often marred by controversy and scandal. What spurred Hamiltonís driving ambition? Why was he hated by so many of his contemporaries? What is his legacy? To find out, Think Tank is joined by Ron Chernow, author of Death of the Banker, The House of Morgan and now Alexander Hamilton. The Topic Before the House: How Alexander Hamilton Shaped America, Part Two. This week on Think Tank.


(musical break)


WATTENBERG: Ron Chernow, welcome back to Part Two of our program on Think Tank about Alexander Hamilton. Your book, as I said in Part One, is a terrific read and is a real work of scholarship. Alexander Hamilton is regarded as a man who was, sort of, fundamental in the growth of the American middle class.


CHERNOW: Well, Hamilton had a much more diversified vision of the American economy. He wanted to have more than just agriculture. Hamilton wanted an economy where everyone would be able to find opportunity; everyone would be able to find...


WATTENBERG: Now at that time - I just know from the census - that about 90 percent of America were farmers.


CHERNOW: And Hamilton knew that that situation would persist for a very long time. But Hamilton helps to found the first - actually the second private bank in the United States... Bank of New York. He then founds the first central bank, the Bank of the United States, which was the forerunner of the Federal Reserve Board. And so heís trying to stimulate trade, commerce and manufacturing; something very different from an agrarian economy, particularly an agrarian economy that in the south is based on slavery. So this is a separate northern economy that is very much based on opportunity.


WATTENBERG: And of course itís - looking back at it in retrospect - itís probably what wins the Civil War for the north by establishing this huge industrial base.


CHERNOW: Manufacturing base, and a much more highly organized economy, yes.


WATTENBERG: You said that Hamilton wrote four great, sort of, state papers as Secretary of Treasury. The one that we hear most about and perhaps you might tell us a little bit about it is called the Report on Manufactures.


CHERNOW: On Manufactures. And it was a prophetic document, because at a time when the Jeffersonians foresaw a nation of small yeoman farmers, Hamilton sketched out a completely different vision. Hamilton was very aware of what was happening in Europe with the Industrial Revolution, which he wanted to bring to America. So although all the founders play a major role in the democratic revolution sweeping the world of the 18th century, itís Hamilton who combines the democratic revolution and the capitalistic revolution. These really become the twin pillars of the American system.


WATTENBERG: But heís also because of his concentration on the economics of it, heís accused of being a monarchist rather than a democrat. Is that right?


CHERNOW: Yes. Heís accused of being a monarchist. There were all sorts of, you know, myths about him. Heís accused of plotting to restore George the 3rd; heís accused of having a secret bank account in London. None of it was true.


WATTENBERG: Now, why do his policies produce such sharp dissents? One would think that someone as smart as Jefferson, who we all grew up thinking was the most brilliant intellectual in the history of the world... John Kennedy has that famous toast about Tom Jefferson. Why do his views cause these great dissents and is he indeed a worthy competitor to the intellectual genius of Tom Jefferson?


CHERNOW: Oh, yes. You know, there are fascinating letters from Jefferson to Madison about Hamilton. In one, Jefferson says to Madison, 'Hamilton is a host within himself. Hamilton is an army by himself.' Thereís another letter where Jefferson writes to Madison he wants Madison to rebut something that Hamilton has written and Jefferson writes to Madison, 'For Godís sake, sir, take up your pen, select the most striking heresies and cut Hamilton to pieces.' There is nobody else who can and will enter the list with him. There is nobody else in America who could compete intellectually with Alexander Hamilton, except for James Madison and Madison was sometimes reluctant to do it. I think that Hamilton felt that the United States could be a great nation-state in order to have, you know, power and peace and prosperity we needed a strong federal government. He restores American credit so we have the power to borrow or the power to tax. He helps to create an army, a navy, a central bank. In other words, he had studied very closely particularly England, France and the Netherlands in terms of what the basic rudiments were of a nation-state. And this was a time, quite understandably, quite naturally, after the revolution there was a real aversion to centralized power. You know, before the Constitutional Convention, under the articles of confederation, there was no federal judiciary. There was really no federal executive to speak of. We had Congress, and we had dozens of different Congressional committees.


WATTENBERG: No President.


CHERNOW: No, there was no President at all. There was not even an executive council. So Jefferson believed very, very strongly in the sovereignty of the states, wanted to concede as little power as possible to the federal government. Hamilton felt that without a federal government these thirteen states would not only be competing and squabbling, but would probably break down into different confederacies; there would be Civil War; there would be disunion, the big states would begin to prey on the small states, etcetera.


WATTENBERG: And yet in the Constitutional Convention and in the Bill of Rights, since honored in its breach, Article 10 says whatever powers are not enumerated to the federal government go to the states. Thatís not what Hamilton believes?


CHERNOW: No. Hamilton articulates the doctrine of implied powers and a lot of Hamiltonís power is the way that he activates the Constitution because in Washingtonís first term the first question always is, is this permissible under the Constitution? Hamilton feels that if one can make a logical argument that this is a means toward an end specified in the Constitution that it is permissable.


WATTENBERG: I see.


CHERNOW: So, on that basis Hamilton argues for the first central bank. Jefferson thought a central bank was unconstitutional. We wouldnít have a Federal Reserve Board today if Jefferson had had his way.


WATTENBERG: But of course thatís the big issue. That goes on and on. Andrew Jackson comes out against that. I mean itís regarded as the rich manís plaything.


CHERNOW: Well, also Jefferson said it wasnít specified in the Constitution but Hamilton said, 'Yes; but the power to tax is specified in the Constitution, so where are we going to collect the taxes?' etcetera.


WATTENBERG: So the argument against Article 10 of the Bill of Rights is a pretty intelligent argument. I had never really thought of it that way. I mean, its implied powers say that, whatever else is in the Constitution, if you have to do it you can do it, notwithstanding Article 10.


CHERNOW: Yes, Hamilton feels that, you know, strict instruction is a kind of straitjacket. And one thing that I think is very important in the post-9/11 world, Hamilton was constantly talking about what would the United States do in different emergencies. Will the government have the powers and the flexibility to respond to emergencies?


WATTENBERG: Did these guys, I mean Hamilton and Jefferson and Washington and Adams and Monroe and whatever - did they understand that they were standing on land that would one day be numero uno in the world?


CHERNOW: Absolutely. For one thing they knew that the population would expand westward. I think they would have been surprised how quickly the population expanded westward. But one of the things that fascinated me when I was doing the Hamilton book was how much they understood about demographics. They had a very good sense of what the population would be fifty and a hundred years hence.


WATTENBERG: You said the magic words for me. The first census, which is taken at the time, I guess, when they apportioned the House of Representatives in 1790, shows a population of a little less than four million people and today weíre close to three hundred million. So, in little more than two hundred years, weíve gone up seventy-five fold, which is an astonishing demographic fact. But when you look at the map and you look at the difficult conditions, in Europe particularly, and elsewhere around the world now, hereís this great open, wealthy country.


CHERNOW: Yes. And I must say, you know, the population question is very important to the American Revolution because Ben Franklin, and others early on say, you know, the colonies, the child will in a matter of years or generations be much larger than the parent, England, and so that we will have to have power commensurate because the child is going to end up much, much larger than the parent. So itís that vision of population growth and itís that vision of westward expansion that, even though the country had a population of only four million, began to make these people feel that they were entitled either to political representation among them or that they deserved their own country.


WATTENBERG: Letís put Hamilton together a little bit as a human being. Hereís this brilliant man, very powerful, described by one and all as devoted to his wife and yet engaged in a series of extramarital affairs, which get him into the soup, big-time, as we say.


CHERNOW: One extramarital affair with a 23-year-old, Mrs. Reynolds. He engages in this affair at the height of his power as Treasury Secretary. Mrs. Reynolds knocks on his door one day in Philadelphia, says sheís been abandoned by her husband and appeals to Hamilton for financial aid. Hamilton goes around to her rooming house that night and, as he wrote in his famous description of it, he said at the top of the stairs, 'Mrs. Reynolds invited me into her bedroom, and when we got there she indicated that other than pecuniary consolation would be acceptable.' This affair goes on for a year and it continues several months later when Mr. Reynolds suddenly surfaces, and instead of stopping the affair, he begins to blackmail Hamilton to continue. And amazingly enough, Hamilton begins to pay him blackmail money. So here this smartest man, I think, in American politics commits about the dumbest blunder. We know about the Reynolds affair because Hamilton wrote a 95-page pamphlet about it. Why did he write a 95-page pamphlet about it? Because when his enemies found out about the blackmail payments to Mr. Reynolds, they said, 'Ah-hah. He was speculating in treasury securities with Mr. Reynolds.' So Hamilton, in order to clear his public reputation, said, 'No, no, no. It wasnít treasury securities. It was adultery with Mrs. Reynolds.'


WATTENBERG: What did Mrs. Hamilton think of this affair with Mrs. Reynolds?


CHERNOW: She never publicly commented on it. They ended up having eight children together. I can tell you she absolutely adored her husband. She lived for fifty years after the duel and spent a lot of it lovingly preserving his papers and...


WATTENBERG: That became, as you described in this wonderful book, that became... her job is to honor his memory.


CHERNOW: Yes. She knew that she was married to a very remarkable but clearly fallible man and thereís a very beautiful letter that her sister, Angelica, wrote to her after the affair came out and Angelica said, 'you know, my sister, Eliza, that in marrying our beloved Alexander you flew too close to the sun'. I mean, he was Prince Charming. He was fatally attractive to the women; he was fatally attracted by the women. He was very handsome. He was very dashing, and she was a deeply religious woman who obviously made extraordinary allowances for her straying husband.


WATTENBERG: Now, letís talk about what every schoolchild in America...used to learn anyway - how Alexander Hamilton dies. Who was Aaron Burr? What was the duel all about? Tell us the whole yarn.


CHERNOW: July 11th, 1804 early in the morning at dawn, Alexander Hamilton and Aaron Burr row across the Hudson River from Manhattan to Weehawken, New Jersey. Hamilton by that point former Treasury Secretary; Aaron Burr is still the sitting Vice President of the United States and they exchange fire and Burrís first shot kills Hamilton. The immediate cause of the duel was that Burr had read in the newspaper that at an Albany dinner party Hamilton had uttered a despicable opinion about him. One that Hamilton refused to admit, apologize for or retract. The larger context was that they were political foes, although actually friends. They were political foes and Hamilton had blocked Burr from becoming President and had blocked Burr that spring from becoming Governor of New York and Burr decided that the state of New York was not big enough for both him and Alexander Hamilton.


WATTENBERG: So you have the sitting Vice President going after the former Secretary of Treasury, committing what was, even then, an illegal act of murder.


CHERNOW: That is very interesting because dueling was illegal in both New York and New Jersey and after Burr fires the fatal shot at Hamilton, Burr is indicted for murder in both New York and New Jersey...sitting Vice President who flees south, he ends up going back to Washington. He still is Vice President and he ends up going back to Washington and presiding over a famous impeachment trial in the Senate. It was a Supreme Court Justice named Samuel Chase who...and of course, a lot of Hamiltonís friends and admirers were horrified that a man who was wanted for murder in two states was sitting up on the dais in the Senate presiding over the impeachment trial of a Supreme Court Justice. The charges were eventually...eventually kind of faded away in New York and New Jersey. Dueling was illegal, but seldom prosecuted.


WATTENBERG: Why did Jefferson and Adams after this death - after this murder with an indictment - why did they, in the years following, continue their attempt to discredit the reputation of Alexander Hamilton?


CHERNOW: Well, Adams and Jefferson both lived for twenty-two years after the duel, and they conduct probably...


WATTENBERG: Died on that famous July 4th.


CHERNOW: July 4th, 1826. Carry out the grandest correspondence in American political history. There are moments where the one big thing they seem to agree on is their dislike of Alexander Hamilton, who had been both a personal antagonist and political adversary of both of them. And they both felt, with a certain justice, that the higher Hamiltonís reputation rose the lower theirs would be and vice versa. Hamilton - Hamiltonís pen is stopped at age 49. He was the most prolific writer probably of their day. He left behind twenty-two thousand pages - collected pages. But Hamilton would have written the most luminous memoirs, and yet his enemies really defines him in that correspondence and also, to name Hamiltonís political enemies - John Adams, Thomas Jefferson, James Madison and James Monroe, you just name presidents two, three, four, and five. So these are no ordinary enemies. They have not only power; they have eloquence and longevity. Hamilton and Adams had a lot of political opinions in common but what happened in Washingtonís first term, Adams, who had been this colossal figure in the Continental Congress when Hamilton was just an undergraduate, suddenly itís Adams as vice president whoís excluded from Washingtonís inner policymaking circles and the young upstart, Hamilton, whoís the most influential voice. Adams is twenty years older, but Hamilton comes out of nowhere and has Washingtonís ear. And it gets worse after that.


WATTENBERG: How long did you spend writing this book, Alexander Hamilton?


CHERNOW: Almost every day for five years.


WATTENBERG: Does his life sort of embody the whole Horatio Alger, rags-to-riches kind of scenario that so many Americans over the centuries grew up with?


CHERNOW: I think, you know, heís almost the archetypal figure because he grows up in this, you know, rigid, awful slave society - slaves and planters - in the Caribbean. He comes here and before he went to Kingís he briefly spent a period in Elizabeth, New Jersey. He had to go to prep school to qualify for college. And he immediately develops, within weeks, powerful patrons: Lord Stirling who becomes a brigadier general in the continental army; Elias Boudinot, who becomes president of the Continental Congress; William Livingston who becomes first governor of New Jersey. Within weeks heís traveling in the highest social and political circles of the country. Where else could this have happened in the 18th century? Certainly not in the Caribbean; certainly not in Europe. Hamilton wouldnít have gotten within a hundred feet of the door.


WATTENBERG: So the phrase 'only in America' goes way back?


CHERNOW: Yes, itís a socially fluid place. Heís remarkably intelligent...


WATTENBERG: Which Tocqueville writes about.



CHERNOW: Yes. Heís remarkably intelligent and charming. He has this kind of orphanís knack for cultivating powerful men and everyone latches onto him. And his advancement gives new meaning to the term meteoric. He just keeps rising and rising and rising - this illegitimate orphaned kid. Itís an amazing story.


WATTENBERG: What is your answer to the question that we hear so often - how did it come to be that you had these intellectual giants amongst a population so small? Or is it that weíre sort of - I forget the historical term for it - but sort of re-creating, or saying we won and therefore everything we did and we wrote is wonderful. Had we lost, these would have been regarded as ruffians who were hung. How do you come out on that?


CHERNOW: They were extraordinarily brilliant, erudite ruffians, I must say. No, I think what it is is that this was one of those rare moments in history where the old order was gone. There was an urgent and immediate need for new ideas so intellectuals who might ordinarily be on the margins of political life, might ordinarily have endowed chairs at Ivy League universities, are suddenly swept right into the center of a political system. We had to create a constitution; we had to create a government. So this was a tremendous stimulant to the minds of these men, because they knew that the decisions they were making, the papers that they were writing, were to be instantly translated into policy. Instead of writing an academic book, you know, for two hundred fellow academics, youíre suddenly writing a constitution thatís going to affect the entire course of a nation. So suddenly, I think, these people were able to realize their potential in a way that would have been very difficult to any other period.


WATTENBERG: Course of the nation and, as it turned out, course of the world.


CHERNOW: Course of the world. And they said, because they would keep saying things - Hamilton, Madison, all of them - 'the eyes of the world are upon us.' This is not just the American experiment; this is an experiment for humanity. So these were people who were very aware of their place in history.


WATTENBERG: The columnist George Will wrote once that America is the most important story in history.


CHERNOW: Well, I think so. You know, itís an idea that goes on and on, and what I find particularly interesting in studying this history is...


WATTENBERG: With a lot of stains on it.


CHERNOW: A lot of stains on it. But just how long it took this country to establish a democracy and to settle down. I would really say Lexington and Concord, 1775...country doesnít begin to settle down from this turbulence Iíd say until Jeffersonís inaugurated in 1801. I mean thereís a twenty-six-year period of...before there had been fierce clashes with the British. Then there are fierce clashes within the country. We didnít do it overnight. There was no kind of golden dispensation.


WATTENBERG: So when people are looking for instant solutions in Iraq theyíre not going to find the model here.


CHERNOW: What happened - no, you know, people - if you look at our own history, we had so many advantages that Iraq didnít have. You know, we had a much more literate and prosperous society. If you look at Jefferson, Madison, Washington, they all had experience in colonial assemblies. So many of these men were lawyers steeped in British common law. If, with all of those advantages, it took us years and decades to begin to get it right. Itís sobering as well as inspiring, you know.


WATTENBERG: If he had a week to wander around and read the papers and watch television and do all the things that people do, what would Alexander Hamilton think of the United States of America today?


CHERNOW: Oh, I think he would smile with recognition, and I think he would feel very vindicated not only in terms of the diversity of the economy and the diversity of the population. Hamilton believed strongly in the federal government. It was Hamilton who felt that the American president should be the chief actor in the political drama. He felt that it was the executive branch that should really govern foreign policy. Jefferson wanted Congress to govern foreign policy. So he foresaw, I think, really the shape of political power; the shape of the American economy. I think that he would walk down Wall Street and be amazed that that street where they in his days as treasurer/secretary had traded only five securities on the curb, where suddenly the largest, you know, capital market in the world. Suddenly he has established this pilot project in Patterson, New Jersey, first manufacturing - not first manufacturing; one of the first. He would certainly be amazed that weíve become the leading manufacturing nation in the world. He had argued for a professional army when Jefferson wanted state militias. He would be very, I think, amazed that we had the largest, you know, military establishment in the world. I donít know that he would agree with each and everything weíve done with it, but in general the world kind of looks the way that he prophesied.


WATTENBERG: On that note, Ron Chernow, thank you very much for joining us on this quite remarkable two-installment conversation about Alexander Hamilton, which is the title of your new book and a wonderful book it is. And thank you. Please remember to send us your comments via email. It helps us make the show better. For Think Tank, Iím Ben Wattenberg.

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At Pfizer weíre spending over five billion dollars looking for the cures of the future. We have twelve thousand scientists and health experts who firmly believe the only thing incurable is our passion. Pfizer. Life is our lifeís work.


Additional funding is provided by the Bernard and Irene Schwartz Foundation, the Smith Richardson Foundation, the John M. Olin Foundation, and the Lynde and Harry Bradley Foundation.


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