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largement and consolidation of the central power. Secretary of War Knox followed Hamilton almost slavishly. And Washington, while prizing Jefferson's advice highly, and attempting to hold the balance justly between the two “factions” of his cabinet, inclined more and more to the views of Hamilton. This condemned Jefferson finally to the rôle of the “leader of the opposition” in the cabinet.
When Jefferson reached New York in March, 1790, to take his seat at Washington's council board, the policy of the administration was well under way. Congress was in the midst of its second session. A tariff act had been passed to provide a national revenue and incidentally to afford protective encouragement to American manufacturers. The executive departments had been organized. The Supreme Court had been constituted, consisting of a chief justice and five associate justices, with seventeen subordinate circuit and district courts in the States. And, most significant of all, Alexander Hamilton, at the head of the treasury department, was fairly launched on the financial programme which split cabinet, Congress, and the country into the opposing parties of Federalists and Republicans.
On January 14, 1790, while Jefferson was still tarrying at Monticello, Hamilton presented to Congress his first Report on the Public Credit, a long document which Henry Cabot Lodge ranks second
only in importance to Lincoln's Emancipation Proclamation in our American state papers, for the farreaching results which it produced. In it Hamilton urged not only the payment in full of the face value of the foreign and domestic debt of the United States contracted in the Revolution and under the Confederation, but even the assumption of the State debts by the central government-thus creating a great national debt of some seventy-five million dollars, held by the capitalists of the country, and assured to them as a permanent investment by the provision that Congress might redeem no more than two per cent of the principal annually. To Hamilton's opponents this scheme appeared like simply mortgaging the government of the United States to the capitalist class, extracting the annual interest of millions of dollars on the mortgage from the toil of the farmer, the artisan, and the merchant. Hamilton did not deny that his chief object was to rally the wealth of the country to the support of the government, to preserve the credit of the country in the eyes of foreign nations. As far back as 1780, when the paper currency of the country was almost worthless, he had written, as a young man of twenty-three, to the experienced financier, Robert Morris: “The only plan that can preserve the currency is one which will make it the immediate interest of the moneyed men to co-operate with the government in its support." From this advocacy of a partnership between capital and government Hamilton never departed.
The contest over the assumption of the State debts, the hardest part of the Hamiltonian programme to put through Congress, was at its height when Jefferson arrived in New York. In the Anas, a kind of scrap-book thrown together nearly thirty years later from memoranda of conversations and impressions jotted down at the time, Jefferson gives a lively description of how he was drawn into the controversy. “So high were the feuds excited by this subject that ... . business was suspended. Congress met and adjourned from day to day without doing anything, the parties being too much out of temper to do business together. The Eastern members particularly, who, with Smith from South Carolina, were the principal gamblers in these scenes, threatened a secession and dissolution. Hamilton was in despair. As I was going to the President's one day, I met him in the street. He walked me backward and forward before the President's door for half an hour. He painted pathetically the temper into which the legislature had been wrought, the disgust of those who were called the Creditor states, the danger of the secession of their members, and the separation of the states. He observed that the members of the administration ought to act in concert, that tho' this question was not of my department, yet a common duty should make it a common
concern; ... and that the question having been lost by a small majority only, it was possible that an appeal from me to the judgment and discretion of some of my friends might effect a change in the vote, and the machine of government, now suspended, might be again set into motion. I told him I was really a stranger to the whole subject; not having yet informed myself of the system of finances adopted, I knew not how far this (assumption] was a necessary sequence; that undoubtedly, if its rejection endangered a dissolution of our union at this incipient stage, I should deem that the most unfortunate of all consequences, to avert which all partial and temporary evils should be yielded. I proposed to him, however, to dine with me the next day, and I would invite another friend or two, bring them into conference together, and I thought it impossible that reasonable men, consulting together coolly, could fail, by some mutual sacrifices of opinion, to form a compromise which was to save the union.” The informal diplomats of the dinnertable arranged the matter satisfactorily. Hamilton got his Southern votes for assumption, and the location of the capital went to the banks of the Potomac.
Later on, when Jefferson saw the full significance of Hamilton's financial programme, and realized to his horror that he had been made a party to fixing the “octopus” of the money power on the government, he complained bitterly that he had been
“duped” by Hamilton and “most ignorantly and innocently been made to hold the candle” for his nefarious act. At the time the bargain was made, however, Jefferson does not seem to have had any · suspicion of deceitfulness on Hamilton's part or
impropriety in his own behavior. In his contemporaneous correspondence he speaks of assumption in a disinterested fashion as “one of those questions which present great inconveniences whichever way it is decided”; as a measure "to be yielded to for the sake of union and to save us from the greatest of all calamities, the total extinction of our credit in Europe”; and as "a proposition which could not be totally rejected without preventing the funding of the public debt altogether, which would be tantamount to a dissolution of the government. On the day before the bill passed he wrote approvingly to Francis Eppes, his brother-in-law: “The assumption of the state debts will, I believe, be agreed to." These quotations make clear that Jefferson, in so far as he had given any attention to the question of assumption, was not at any serious disagreement with Hamilton, and give some color to the charge of his hostile biographers that he was inclined to read sinister motives into the acts of men from whom he had come to differ. Jefferson had no cause to complain of the assumption bill. He had been in this country ever since the policy was broached in Hamilton's first Report. He was an