Tuesday, September 2, 2014

Today Marks 225 Years of Hamiltonianism

By Chris Rossini

A little history is in order for today, the 225th Anniversary of the U.S. Treasury.

As I detailed in Set Money Free, the Federal Reserve didn't just pop out of the skies one day in 1913. Nor was The Fed the first attempt at central banking in America. It just happened to be the one that stuck.

The first central bank, The Bank of North America, was driven through the Continental Congress by Robert Morris in 1781. It failed in 1783.

In 1787, there occurred the ever-important Coup in Philadelphia, and in 1789 the U.S. Treasury opened its doors. Tom DiLorenzo explains:
Morris did not give up on his scheme. He recruited a young Alexander Hamilton to serve more or less as his political puppet within the Washington administration. (Rothbard called Hamilton "Morris's youthful disciple.") In fact, the reason why Hamilton became Treasury secretary, despite having no reputation at all in the field of finance, was the recommendation by Morris to George Washington.

So the Coup in Philly was a success, and Morris's man was in place as U.S. Treasury Secretary. Now for the coup de gras.

Just two years later, in 1791, Hamilton would push the next attempt at central banking through Congress. It would be called The First Bank of The United States. The bank's President would be none other than Thomas Willing, former partner of Robert Morris!

The First Bank would be closed (by Thomas Jefferson). Shortly after, The Second Bank would be created, and also closed (this time by Andrew Jackson). However, the avalanche was in motion. In 1913, the financier for Empire would finally stick.

It all began (first with the Coup in Philly) followed by Alexander Hamilton, and the interests behind him.

The story (and damage) of Hamilton does not end there. Please see Tom DiLorenzo's: Hamilton's Curse: How Jefferson's Arch Enemy Betrayed the American Revolution--and What It Means for Americans Today


  1. How the Dollar Will Die
    Hugo Salinas Price

    All the currencies of the world today are derivatives of the dollar, including the Russian Ruble and the Chinese Yuan, and even the miserable currencies of Venezuela and Argentina. As long as they can be used to purchase dollars, either officially or through the black market, they will continue in circulation.

    The Mexican Peso circulates and has value, because Mexicans have always been able to purchase dollars with pesos (except for a few days during the “Mexdollar” crisis of the early ‘80s). The price of the dollar in pesos has varied, but at any rate it has (almost) always been possible to obtain dollars in exchange for pesos.


  2. The headline implies continuity but the text admits that there were substantial periods without a central bank. Perhaps the reason for this is to allow people to ignore the fact of inflation, recession and depression in the absence of a central bank and in the presence of a gold standard. Am I right? Or was it just an oversight induced by cognitive bias? Or maybe something else?

    Another problem with the headline is that tariffs were an essential part of "Hamiltonianism," but those largely went out the window in the 1980s as we embraced "free" trade (at the cost of our manufacturing industry). Hamilton was also an advocate of the gold standard (silver, too). You can't have Hamiltonianism without tariffs and the gold standard, so whatever we have today ain't Hamiltonianism. I'd call it Milton Friedmanism, or "Friedmanism" for short (the neoliberal, libertarian combination of a Chicago School monetarist central bank and "free" trade).

    So, maybe your headline should refer to celebrating 39 years of Friedmanism (if you count back to the joint resolution of Congress re: what became the Fed's monetarist "mandate" in Section 2a of the FRA), although it would be more accurate to calculate the period starting in 1971 with Nixon's closing of the gold window at the urging of people like Friedman and Volcker; e.g., we're talking 43 years.

    DiLorenzo is not a reliable source for understanding history. Maybe that's why you don't understand our history.

    1. Ha, are you chiding Rossini for not writing a comprehensive monetary history of the US?

    2. The contents of your post have been thoroughly debunked on numerous occasions in the past. And individuals attempting to accuse Thomas DiLorenzo of inaccurate historical interpretation have proven quite false.