Alexander Hamilton: Federalist & Founder

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  • 0:03 What Is a Federalist?
  • 0:34 Hamilton Pens…
  • 1:54 Secretary of Treasury
  • 4:05 First Two Political Parties
  • 5:37 Lesson Summary
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Lesson Transcript
Instructor: Lucia Reyes
Alexander Hamilton helped shape the United States as one of its Founding Fathers. This lesson explores his role in creating and supporting the Constitution, as well as his controversial role as a Federalist.

What Is a Federalist?

A federalist is someone who supports federalism, which is the distribution of power between national and state governments. They each have some separate powers, as well as some shared, or concurrent powers. Federalists were also the initial supporters of the U.S. Constitution. They favored a strong central government, rather than a government in which power rested primarily with the states. The Federalists were also a political party, founded by Alexander Hamilton.

Hamilton Pens Federalist Papers

As a state representative from New York, Alexander Hamilton took part in the Constitutional Convention in 1787. During this meeting, held in Philadelphia, a new plan for government was formed - the Constitution. Hamilton strongly supported adopting the Constitution and replacing the Articles of Confederation, the United States' existing plan for government. According to Hamilton, the Articles placed too many limitations on federal power and gave too much power to the individual states.

Once the Constitution was finalized, nine of the thirteen states had to ratify it to make it the official new plan for government. Opponents to the Constitution's adoption felt that it gave too much power to the central government. They were known as Anti-Federalists. Hamilton was a Federalist, supporting the approval of the Constitution. He set out to convince New York legislators to approve it as well. Hamilton and two others, John Jay and James Madison, published a series of essays in New York newspapers known as the Federalist Papers. These papers made strong arguments in support of the Constitution. Hamilton himself was responsible for fifty-one of the eighty-five essays. Perhaps influenced by these essays, New York became the eleventh state to ratify the Constitution.

Secretary of Treasury

With the Constitution up and running, the nation moved forward under the leadership of its first president, George Washington. When choosing members of the first cabinet, Washington turned to people he trusted and respected. He chose Thomas Jefferson as Secretary of State and Henry Knox as Secretary of War. He offered the job of Secretary of Treasury to Alexander Hamilton. Hamilton had been Washington's Lieutenant Colonel during the Revolutionary War, and he knew he could count on him as a trusted adviser.

As the nation's lead financier, Hamilton faced the tough task of organizing the nation's messy economic situation. By 1790, he had developed an economic plan, which consisted of three main parts:

  1. Number one was to pay off war debt: After the costs of the Revolutionary War, the United States was $52 million in debt. They borrowed from countries, such as France, the Netherlands, and Spain, as well as from private citizens. Hamilton was adamant to secure future relations with these lenders by paying off debt.

  2. Number two was to raise government revenues: Hamilton suggested imposing tariffs, or taxes, on imports. He wanted to raise money as well as encourage Americans to buy American products.

  3. Number three was to create a national bank: Having a national bank would protect federal funds and enable the government to issue loans. The bank would also issue paper money.

Hamilton's plan had many opponents. For example, some felt the federal assumption of all state debts gave the central government too much power. To gain support from the South, Hamilton asked Thomas Jefferson for assistance. Jefferson agreed to publicly support the national repayment of debts only if Hamilton supported his idea to move the state capitol from New York City to a spot along the Potomac River in the South. Hamilton agreed.

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