Key ideas: Published in 1926. Throughout his life, Mr. Jefferson consistently maintained that “the most effectual means of preventing the perversion of power into tyranny are to illuminate as far as possible the minds of the people.” He had no doubt that “if a nation expects to be ignorant and free, . . . it expects what never was and never will be.” He seems never to have suspected, however, the ease with which mere literacy is perverted, and that it is therefore quite possible for a literate people to be much more ignorant than an illiterate people—that a people of well-perverted literacy, indeed, is invincibly unintelligent. (Albert Jay Nock)
The College of William and Mary, named for the sovereigns who had chartered it under the auspices of the Church of England, was the second institution of the higher learning set up on this continent. For the time, it was well endowed….
The college followed “the grand old fortifying classical curriculum” that is to say, it offered the student Latin, Greek, mathematics, moral philosophy, and a favourable view of the Christian faith as held by the Church of England.
But the institution never did well. Its management was poor, and its instruction worse…
In 1760, an oddly-assorted company of four persons drew together at Williamsburg, and remained in close association, helping one another make what they could of a rather dull life, for the better part of two years.
These alien spirits met at dinner at least once a week¿ and half a century later, one of the group, after a long experience of the best social life in both hemispheres, left record that “at these dinners I have heard more good sense, more rational and philosophical conversations, than in all my life besides.”
The most significant member of the group is the one who has, unfortunately, left the faintest mark on history. The little that is known of him is only enough to make us wish we knew more.
This was Dr. William Small, a Scotsman, professor of mathematics at William and Mary. He seems to have been a sort of Abelard in omne re scibiliy for at one time or another he also taught moral philosophy, rhetoric and literature, and carried on some work in applied science. No one knows what circumstances brought him to the college -, but once there, he seems quickly to have had enough of a dissolute, time-serving clergy, of riotous students, and of the pre-vailing incompetence, indolence and wrangling…
In 1762, he went back to England, and became “the great Dr. Small o£ Birmingham.” But there too he left a pro-vokingly slight account of himself. He was a friend of the elder Darwin 5 there were dark hints against his orthodoxy and he helped James Watt in developing the steam-engine.
The second of the company was a lawyer named George Wythe, subsequently Chancellor of Virginia, a signer of the Declaration of Independence, and law-tutor of John Marshall and Henry Clay. Self-educated, except perhaps for Latin, he was said to be the best Greek scholar in the colony.
Third in the group was the Governor of the colony, Francis Fauquier, a remarkable exception to the general run of British proconsular officers. He was the most accomplished person that Virginia had ever seen, a cultivated man of the world, with every distinction and charm of manner5 an excellent musician and linguist, a discerning traveller who had sampled civilized society almost everywhere in Europe.
A strange passion for gambling had stood in his way. The tradition is that having gambled away all his property at a sitting, he was glad to get the appointment to Virginia to keep himself going.
The fourth member of the group was a boy of seventeen, who had entered college early in the year. He was tall and loose-jointed, with hazel-grey eyes and sandy hair, an extremely thin skin that peeled on exposure to sun or wind, stout wrists, large hands and feet. His name was Thomas Jefferson….
Mr. Jefferson always had a healthy man’s scepticism about the various theories of medicine, and spoke of them in the vein of Daniel Defoe.
“I believe we may safely affirm that the inexperienced and presumptuous band of medical tyros let loose upon the world destroys more of human life in one year than all the Robin Hoods, Cartouches and Macheaths do in a century.”
He remarked on one occasion that he never saw three physicians talking together, without glancing up to see if there were not a turkey-buzzard hovering overhead.
His own theory of medicine anticipated the modern belief that “the judicious, the moral, the humane physician should stop” with the attempt merely to assist “the salutary effort which nature makes to re-establish the disordered functions.”
Yet, on the other hand, he was one of the first to undergo vaccination, or “inoculation for the small pox,” as practiced by Dr. Shippen of Philadelphia, stopping there for that purpose in the course of a journey to New York at the age of thirty-three.
In 1782 he decided that he had done enough in public office to earn the right to uninterrupted enjoyment of “my family, my friends, my farm and books” thenceforth.
He wrote a long letter to Monroe, protesting against the idea that the State had a right to commandeer indefinitely the political services of its members
This, he says, “would be slavery, and not that liberty which the Bill of Rights has made inviolable,” and for his part, he had a clear conscience about retiring.
But his distaste grew steadily, and even after he gave up practice, it kept on growing. His earlier experience in practical politics and in government-building, where he saw the worst degeneration of legal theory and practice, their frankest dissociation from anything resembling justice and the public good, increased his detestation of lawyers j and it was brought to full growth by the chicanery that he found in high triumphant progress on his return to America in 1789, after five years of ambassadorship in Europe.
As he passed into old age, it became inveterate.
In 1810, advising a namesake on the choice of an occupation, he remarks that if a physician ends his. days conscious that he has saved some lives and not killed anybody through carelessness, he will have “the happy reflection of not having lived in vain; while the lawyer has only to recollect how many, by his dexterity, have been cheated out of their right and reduced to beggary.”
If Congressmen talk too much, “how can it be otherwise,” he writes contemptuously in 1821, “in a body to which the people send one hundred and fifty lawyers, whose trade it is to question everything, yield nothing, and talk by the hour?”
Mr. Jefferson’s farming managed to pay its way for a time, but not by a comfortable margin. At almost any point in his history one is prepared to find him anticipating the modern lawyer-farmer, who practises law to keep the farm going
He had an immense amount of land; so much that if land had been taxed even nominally, he would have been land-poor. He owned more than a dozen properties, with a total of nearly eleven thousand acres; half of it in Albemarle County, half in Bedford and Campbell.
But as soon as he set foot in France, Mr. Jefferson faced the real thing in involuntary poverty. After a year, he writes despondently to an American correspondent that “of twenty millions of people supposed to be in France, I am of the opinion there are nineteen millions more wretched, more accursed in every circumstance of human existence than the most conspicuously wretched individual of the whole United States.”
The people had been exproprîated from the land, and huddled into vast exploitable masses.
“The property [i.e., the land] of this country is absolutely concentrated in a very few hands, having revenues of from half a million guineas a year downward” 5 and the consequence was that the majority lived merely on sufferance.
Involuntary poverty, one might say, was so highly integrated as to erect mendicancy into an institution. This was new to Mr. Jefferson.
“I asked myself what could be the reason that so many should be permitted to beg who are willing to work, in a country where there is a very considerable proportion of uncultivated lands,” and his conclusion was that “whenever there is in any country uncultivated lands and unemployed poor, it is clear that the laws of property have been so far extended as to violate natural rights. The earth is given as a common stock for man to labour and live on.”
However, this was France’s problem, not his and not America’s—thank Heaven. He writes in a fervent strain to Monroe, “My God! how little do my countrymen know what precious blessings they are in possession of, and which no other people on earth enjoy. I confess I had no idea of it myself.” America had no end of land, and hence no problem of poverty.
In science, he discovers that their literati “are half a dozen years before us. Books, really good, acquire just reputation in that time, and so become known to us and communicate to us all their advances in knowledge.”
America, however, really misses nothing by being behindhand. Having few publishers and presses, American intelligence is saved the chance of suffocation under huge masses of garbage, such as are shot from the many presses of France.
“Is not this delay compensated to us by our being placed out of reach of that swarm of nonsensical publications which issues daily from a thousand presses and perishes almost in issuing?”
Mr. Jefferson remarked in reporting this matter to Congress, that “the influence of the Farmers-General has been heretofore found sufficient to shake a minister in his office,” and that if Calonne opposed the tobacco-monopoly, “the joint interests of France and America would be insufficient counterpoise in his favour,” and he would lose his place.
After a year and a half of this kind of shilly-shallying, Mr. Jefferson writes mournfully, “What a cruel reflection, that a rich country can not long be a free one!”
Wherever his eyes rested, he saw the French producer labouring under “all the oppressions which result from the nature o£ the general government, and from that of their particular tenures, and of the seignorial government to which they are subject.”
Government, in short, was, as Voltaire said, a mere device for taking money out of one man’s pocket and putting it into another’s
The European governments, he writes to Rutledge, are “governments of wolves over sheep.”
All he saw confirmed him in the view which he had laid down at the age of thirty, in his paper on The Rights of British America y saying that “the whole art of government consists in the art of being honest” and in the Declaration of Independence, saying that governments are instituted among men to secure certain inherent and inalienable rights, and that “whenever any form of government becomes destructive of these ends, it is the right of the people to alter or abolish it.”
The European ensembley and the progress of Constitution-building in America during the years 1786-1787, turned Mr. Jefferson’s mind towards some speculations on the general theory and practice of government.
The trouble with government in Europe as he saw it, was its complete centralization in the hands of the relatively few non-producers; the symbol of this centralization was monarchy. Those who actually applied labour and capital to natural resources for the production of wealth, had no voice in government…
… one of his last letters from Paris, written to Edward Carrington, contained the observation that “the natural progress of things is for liberty to yield and government to gain ground.”
Because this tendency is wholly natural, there was no point to getting up a great sweat of moral indignation against it.
One of the most profound preferences in human nature is for satisfying one’s needs and desires with the least possible exertion; for appropriating wealth produced by the labour of others, rather than producing it by one’s own labour.
Any Frenchman, for example, would rather worm his way into the membership of the Farmers-General and levy on the wealth produced by French labour and capital, than employ his own labour and capital to produce wealth for himself.
Any Englishman would rather live by appropriating the economic rent of land-holdings than by working.
Obviously, the stronger and more centralized the government, the safer would be the guarantee of such monopolies; in other words, the stronger the government, the weaker the producer, the less consideration need be given him and the more might be taken away from him.
A deep instinct of human nature being for these reasons always in favour of strong government, nothing could be a more natural progress of things than “for liberty to yield and government to gain ground.” In England and France, government had gained all the ground there was, and liberty had yielded all. That was the whole story.
For America, Mr. Jefferson was convinced that republicanism was a better system because it lent itself less easily to centralization. It gave the producer some kind of voice in the direction of affairs, and since the producer was greatly in the majority in any society, he had—if he were interested and intelligent enough to profit by it— a fair chance of keeping his interests uppermost.
Republicanism was not the ideal system. The Indians, as Mr. Jefferson points out to Madison, lived in a distinct and quite highly organized type of society, and got on very well without any government at all.
While “it is a problem not clear in my mind that [this] condition is not the best,” he believed it to be “inconsistent with any great degree of population,” though he seems never to have asked himself just why this should be so.
But republicanism is no fetish he is perfectly clearsighted about this. Republicanism gives the producing classes their chance 5 but it does not protect them automatically if they are not for ever alive to their chance.
“If once the people become inattentive to the public affairs,” he writes austerely from Paris to Edward Carrington, “you and I and Congress and Assemblies, Judges and Governors, shall all become wolves. It seems to be the law of our general nature, in spite of individual exceptions.”
he most that can be said for republicanism is that intrinsically “the republican is the only form of government which is not eternally at open or secret war with the rights of mankind”; but most of the republics of the world, he yet reminds Madison, have degenerated into governments of force and in his draft of the Diffusion of Knowledge Bill, eight years before, he had incorporated the warning that while
“certain forms of government are better calculated than others to protect individuals in the free exercise of their natural rights, and are at the same time themselves better guarded against degeneracy, yet experience hath shown that even under the best forms, those entrusted with power have, in time, and by slow operations, perverted it into tyranny.”
If the United States were to exist at all, and not be swallowed piecemeal by the predacious military powers of Europe, it must become, for some purposes, a nation 5 it must have, for instance, a central body of authority for its foreign affairs…
But he was sure that the purposes for which the United States should be a nation must be as few as possible, otherwise the history of European exploitation would be repeated on the grand scale.
The utmost concession that it would be proper to make, as he wrote to his old preceptor, George Wythe, was that
“the States should severally preserve their sovereignty in whatever concerns themselves alone, and whatever may concern another State, or any foreign nation, should be made a part of the Federal sovereignty.”
After all, the domestic functions of an honest Federal sovereignty were few, and their character purely administrative and nonpolitical—carrying the mails, coining money, regulating transportation, and the like—and for the rest, speaking generally, “the States should be left to do whatever acts they can do as well as the General Government.”
In short, the United States should be a nation abroad, and a confederacy at home.
“Events have proved their lamentable error,” Mr. Jefferson wrote thirty years later, after the Revolution had degenerated through the course of its own enormities, and made way for those of Napoleon.
The revolutionists could not foresee “the melancholy sequel of their wellmeant perseverance 3 that their physical force would be usurped by a first tyrant to trample on the independence and even the existence of other nations.”
Worst of all, they could not foresee the ensuing defensive freemasonry of the Russian Emperor Alexander’s league of nations called the Holy Alliance, set up to make international common cause among the exploiting classes and unite them against the revolutionary spirit, wherever found.
In Lorraine, as in Germany, he saw women doing all kinds of manual work, and their persistent love of ornament bore him eloquent testimony to the better way that things were managed in Virginia, where women did their duty in that station of life unto which it had pleased God to call them.
He remarks this with a detachment so profound as to give his observations a patronizing air—one may charitably hope that they never fell under the eye of contemporary feminism, as represented by Mary Wollstonecraft, for example.
“While one considers them as useful and rational companions, one can not forget that they are also objects of our pleasures5 nor can they ever forget it. While employed in dirt and drudgery, some tag of a ribbon, some ring or bit of bracelet, earbob or necklace, or something of that kind, will show that the desire of pleasing is never suspended in them.”
This “barbarous perversion of the natural destination of the two sexes” was due to the swollen military establishment which kept so many men out of industry.
It was a sorry sight, which one could never get out of one’s memory.
“Women are formed by nature for attentions, not for hard labour. A woman never forgets one of the numerous train of little offices which belong to her. A man forgets often.”
He had heard of a political party-division on an issue called Federalism. He did not know much about this, and when it was explained to him by letter, he took instinctively a Pauline view of it.
“I am not a Federalist,” he wrote Hopkinson, shortly before leaving France, “because I never submitted the whole system of my opinions to the creed of any party of men whatever, in religion, in philosophy, in politics, or in anything else where I was capable of thinking for myself. Such an addiction is the last degradation of a free and moral agent. If I could not go to heaven but with a party, I would not go there at all. Therefore I am not of the party of Federalists. But I am much farther from that of the anti-Federalists.”
[after returning to the US,] he began also to perceive that the distinction between Federalist and anti-Federalist, which he had disparaged in his letter to Hopkinson, was likely to mean something after all.
He set out on the first of March, 1790, for New York, the temporary capital, where he found himself a cat in a strange garret….
Every one talked politics, and every one assiduously talked up a strong government for the United States, with all its costly trappings and trimmings of pomp and ceremony. This was a great let-down from France, which he had just left
“in the first year of her revolution, in the fervour of natural rights and zeal for reformation. My conscientious devotion to these rights could not be heightened, but it had been aroused and excited by daily exercise.”
No one in New York was even thinking of natural rights, let alone speaking o£ them.
The “principal citizens” held the French Revolution in devout horror. “I can not describe the wonder and mortification with which the table-conversations filled me.”
Where indeed was the old high spirit, the old motives, the old familiar discourse about natural rights, independence, self-government? Where was the idealism that these had stimulated —or the pretence of idealism that these had evoked?
One heard nothing here but the need for a strong government, able to resist the depredations which the democratic spirit was likely to make upon “the men of property,” and quick to correct its excesses.Many even spoke in a hankering fashion about monarchy.
All this, manifestly, was nothing to be met with the popgun of Constitutional amendments providing for a Bill of Rights and rotation in office$ manifestly, the influential citizenry of New York would but lift their eyebrows at a fine theoretical conception of the United States as a nation abroad and a confederacy at home.
Mr. Jefferson’s ideas were outmoded […] Other ideas were to the front; and when Washington’s Cabinet came together, Mr. Jefferson confronted the coryphæus of those ideas in the person of a very young and diminutive man with a big nose, a giddy, boyish and aggressive manner, whom Washington had appointed Secretary of the Treasury.
Alexander Hamilton came to the colonies at the age of sixteen, from his home in the West Indies, dissatisfied with the prospect of spending his days in “the grovelling condition of a clerk or the like, . . . and would willingly risk my life, though not my character, to exalt my station. . . . I mean to prepare the way for futurity.” This was in 1772…
He always gave a good and honorable quid pro quo for his demands; he had great ability and untiring energy, and he threw both most prodigally into whatever cause he took up. Money never interested him. Although he inaugurated the financial system which enriched so many, he remained all his life quite poor, and was often a good deal straitened…
He was elected to Congress in 1782; he served as a delegate to the Constitutional Convention in 1787; and now he was in the Cabinet, as the recognized head of the centralizing movement.
The four great general powers conferred by the Constitution upon the Federal Government were the power of taxation, the power to levy war, the power to control commerce, and the power to exploit the vast expanse o£ land in the West.
The task now before Congress was to pass legislation appropriate to putting these powers into exercise. There was no time to be lost about this. Time had been the great ally of the coup d’etat….
Now, in this next task, which was, in Madison’s phrase, to administration the government into such modes as would ensure economic supremacy to the non-producing interests, there was urgent need of the same powerful allyj and here was the opportunity for the great and peculiar talents that Alexander Hamilton possessed.
Perhaps throughout, and certainly during the greater part of his life, Hamilton’s sense of public duty was as keen as his personal ambition. He had the educated conscience of the arriviste with reference to the social order from which he himself had sprung. A foreigner, unprivileged, of obscure origin and illegitimate birth, “the bastard brat of a Scots pedlar,” as John Adams testilycalled him, he had climbed to the top by sheer force of ability and will.
In his rise he had taken on the selfmade man’s disregard of the highly favourable circumstances in which his ability and will had been exercised 3 and thus he came into the self-made man’s contemptuous distrust of the ruck of humanity that he had left behind him. The people were “a great beast,” irrational, passionate, violent, dangerous, needing a strong hand to keep them in order.
Pleading for a permanent President and Senate, corresponding as closely as might be to the British model of a King and a House of Lords,he had said in the Constitutional Convention that all communities divide themselves into the few and the many, the first being
“the rich and well-born, the other the mass of the people…
The people are turbulent and changing; they seldom judge or determine right. Give therefore to the first class a distinct permanent share of government…
Nothing but a permanent body can check the imprudence of democracy. Their turbulent and uncontrollable disposition requires checks.”
He had no faith in republican government, because, as Gouverneur Morris acutely said, “he confounded it with democratical government, and he detested the latter, because he believed it must end in despotism, and be in the meantime destructive to public morality.”
But republican government was here, and he could not change it…
Hamilton, at any rate, was well aware of it. The thing, then, was to secure the substance of absolutism under republican forms; to administration republican government into such absolutist modes as the most favourable interpretation of the Constitution would permit.
Here was the line of coincidence of Hamilton’s aims with the aims of those who had devised and promulgated the Constitution as an economic document. These aims were not identical, but coincident.
Hamilton was an excellent financier, but nothing of an economist. In so far as he had any view of the economics of government, he simply took for granted that they would, as a matter of course and more or less automatically, arrange themselves to favour “the rich and well-born,” since these were naturally the political patrons and protectors of those who did the world’s work…
Strong in his belief that men could be moved only by force or interest, he fearlessly accepted the corollary that corruption is an indispensable instrument of government, and that therefore the public and private behaviour of a statesman may not always be answerable to the same code.
Hamilton’s general plan for safeguarding the republic from “the imprudence of democracy” was at bottom extremely simple.
Its root-idea was that of consolidating the interests of certain broad classes of “the rich and well-born” with the interests of the government.
He began with the government’s creditors. Many of these, probably a majority, were speculators who had bought the government’s war-bonds at a low price from original investors who were too poor to keep their holdings.
Hamilton’s first move was for funding all the obligations of the government at face value, thereby putting the interests of the speculator on a par with those of the original holder, and fusing both classes into a solid bulwark of support for the government.
This was inflation on a large scale, for the values represented by the government’s securities were in great part—probably sixty per cent—notoriously fictitious, and were so regarded even by their holders.
A feeble minority in Congress, led by Madison, tried to amend Hamilton’s measure in a small way, by proposing a fair discrimination against the speculator, but without success…
Hamilton’s own defence of indiscriminate funding was characteristic; he declared that the impoverished original holders should have had more confidence in their government than to sell out their holdings, and that the subsidizing of speculators would broadcast this salutary lesson.
Hamilton’s bill contained a supplementary measure which reached out after the State creditors, united them with the mass of Federal creditors, and applied a second fusing heat.
The several States which had at their own expense supplied troops for the Revolutionary army, had borrowed money from their citizens for that purpose; and now Hamilton proposed that the Federal Government should assume these debts, again at face value—another huge inflation, resulting in
“twenty millions of stock divided among the favoured States, and thrown in as pabulum to the stock-jobbing herd,” as Mr. Jefferson put it.
Two groups of capitalist interest remained, awaiting Hamilton’s attentions; one of them actual, and the other inchoate. These were the interest of trade and commerce, and the interest of unattached capital looking for safe investment…
The first group had already received a small douceur in the shape of a moderate tariff, mostly for revenue, though it explicitly recognized the principle of protection 5 it was enough to keep them cheerful until more could be done for them.
Considering the second group, Hamilton devised a plan for a Federal bank with a capital of ten million dollars, one-fifth of which should be subscribed by the Government, and the remainder distributed to the investing public in shares of four hundred dollars each.
This tied up the fortunes of individual investors with the fortunes of the Government, and gave them a proprietary interest in maintaining the Government’s stability; also, and much more important, it tended powerfully to indoctrinate the public with the idea that the close association of banking and government is a natural one.
There was one great speculative interest remaining, the greatest of all, for which Hamilton saw no need of taking special thought.
The position of the natural-resource monopolist was as impregnable under the Constitution as his opportunities were limitless in the natural endowment of the country.
Hence the association of capital and monopoly would come about automatically nothing could prevent it or dissolve it: and a fixed interest in the land of a country is a fixed interest in the stability of that country’s government—so in respect of these two prime desiderata, Hamilton could rest on his oars.
In sum, then, the primary development of republicanism in America, for the most part under direction of Alexander Hamilton, effectively safeguarded the monopolist, the capitalist and the speculator. Its institutions embraced the interests of these three groups and opened the way for their harmonious progress in association.
The only interest which it left open to free exploitation was that of the producer.
Except in so far as the producer might incidentally and partially bear the character of monopolist, capitalist, speculator, his interest was unconsidered.
Thus Mr. Jefferson made what he afterwards called, with some exaggeration, the greatest political error of his life.
Really, what he did or did not do in the premises was of little practical consequence to the ultimate issue, namely: what economic interests should control the government of the United States.
He simply did not see the end of Hamilton’s plan; nor, it must be said, did Hamilton himself clearly see it, except with the eye of instinct.
He [Jefferson] was for control of government by the producing class; that is to say, by the immense majority which in every society actually applies labour and capital to natural resources for the production of wealth. His instincts reacted like the reflex action of an eyelid against anything that menaced that interest.
Hamilton’s instinct reacted as promptly against anything that threatened to disturb the preponderance of the exploiting class - the minority, that is, which in every society appropriates without compensation the labour-products of the majority.
Others were more quick than Mr. Jefferson to assess the economic implications of Hamilton’s fiscal system. The science of economics was then in its cradle…
He [Jefferson] He had occasional brilliant flashes of insight into fundamental economics and its relation to government, but they were too brief and unsteady to be illuminating j they but deepened the darkness that followed them.
Others, however, almost immediately applied to Hamilton’s system a kind of homespun economic analysis that reached to its bottom. In dealing with funding and assumption, Mercer of Maryland, Jackson of Georgia and Taylor of Virginia, at once penetrated to the fundamental truth that all largesse to the speculator must ultimately be paid out of production, and that Hamilton’s proposal therefore was actually to put a gratuitous first lien on future labour.
They also took the same ground of public policy in opposing the Bank bill.
The bank project was simply a continuous monopoly of public funds, raised by taxation, by investors in a semi-private corporation—or rather, nominally semi-public but really private, since so large a proportion of the Senate and House were themselves investors who had already profited egregiously by funding and assumption, and who would certainly become shareholders in the new bank. All this, they insisted, was to be brought about at the uncompensated expense of production.
A levy of taxes for this purpose was, according to Taylor, an outright conversion of labourmade values into law-made property, vested in hands which had done nothing to produce them.
“An annuity to a great amount is suddenly conjured up by law,” said Taylor. “. . . It is paid out of labour, and labour in all countries falls on the poor. . . . But the aristocracy, as cunning as rapacious, have contrived to inflict upon labour a tax, constantly working for their emolument.”
Mercer estimated the entire public debt, after its egregious inflation by Hamilton, at “one-fourth of the whole value of the property” of the United States. This is probably an exaggeration; but even cutting it down by one-half, one can imagine the menacing predominance of a single vested interest equal to one-eighth of a country’s total wealth.
No wonder Mr. Jefferson complained bitterly that “the more debt Hamilton could rake up, the more plunder for his mercenaries.”
Alexander Hamilton’s system flowed from principles adverse to liberty, and was calculated to undermine and demolish the Republic by creating an influence of his Department over members of the Legislature.
I saw this influence actually produced, and its first fruits to be the establishment of the great outlines of his project by the votes of the very persons who, having swallowed his bait, were laying themselves out to profit by his plans.
He gives a most vivid picture of the state of things ensuing upon the first trial of Hamilton’s strength in Congress, with reference to the Funding and Assumption bill. When it became known what form the bill would take,
this being known within doors sooner than without, and especially than to those in distant parts of the Union, the base scramble began. Couriers and relay-horses by land, and swift-sailing pilot-boats by sea, were flying in all directions. Active partners and agents were associated and employed in every State, town and country neighbourhood, and this paper was bought up at five shillings, and often as low as two shillings in the pound, before the holder knew that Congress had already rovided for its redemption at par. Immense sums were thus filched from the poor and ignorant. . . . Men thus enriched by the dexterity of a leader would follow of course the chief who was leading them to fortune, and become the zealous instrument of all his enterprises.
Jackson brought out the historical parallel, taken from Blackstone, of the political reasons for creating the British national debt
Because it was deemed expedient to create a new interest, called the moneyed interest, in favour of the Prince of Orange, in opposition to the landed interest which was supposed to be generally in favour of the King.
Mr. Jefferson wrote Washington to the same effect, that “this exactly marks the difference between Colonel Hamilton’s views and mine, that I would wish the debt paid tomorrow; he wishes it never to be paid, but always to be a thing wherewith to corrupt and manage the Legislature.”
Of the Bank project also, he wrote in retrospect, nearly twenty years after the event,
The effect of the Funding system and of the Assumption would be temporary. It would be lost with the loss of the individual members whom it had enriched, and some engine of influence more permanent must be contrived while these myrmidons were yet in place to carry it through all opposition. This engine was the Bank of the United States.
The last of Hamilton’s fiscal measures was a protective tariff; and here again Mr. Jefferson showed a sound instinct outstripping a rather hamstrung economic interpretation. He was a natural free-trader…
“Would even a single nation begin with the United States this system of free commerce, it would be advisable to begin it with that nation; since it is one by one only that it can be extended to all.”
He saw international commerce in the large general terms of “an exchange of surpluses for wants between neighbour nations”; if this exchange could be made free, it would be a great natural stimulus to production all round—“the greatest mass possible would then be produced of those things which contribute to human life and human happiness; the numbers of mankind would be increased, and their condition bettered.”
On the other hand, he accepted the doctrine of retaliatory tariffs, apparently without perceiving that as an economic weapon, any form of tariff, boycott or embargo kicks farther than it carries, and that the best reason for a tariff is invariably a better reason against one.
In their economic judgment on the protective system, Mr. Jefferson’s contemporaries again outran him.
His Virginian neighbour, Taylor, seems to have caught sight of the fundamental principle that in international trade as well as in domestic trade, goods can be paid for only in goods or services, and that money, or any form of credit which apparently pays for them, does not really pay for them, but is merely a device for facilitating their exchange.
“Currency is the medium for exchanging necessaries”— it must have goods behind it, and whatever medium has the guarantee of goods behind it is valid currency.
Trade, then, should follow the natural lines set by purchase in the cheapest market and sale in the dearest; and any mechanism of interference, like a tariff, is disabling.
He also saw that a tariff, by artificially raising prices to the domestic consumer, is a “distribution of property by law” —by political means, in other words, rather than by economic means.
Moreover, by successive shiftings, the final incidence of this tax falls inevitably on production, for any governmental “bounties to capital are taxes upon industry.”
Tightening his terms a little, the values absorbed by the “chartered monoply” created by a tariff-law, must come from somewhere, and there is nowhere for them to come from, finally, but out of production. By the last analysis somebody, in Mr. Jefferson’s phrase, must “labour the earth” to produce them.
Mr. Jefferson stood out against Hamilton in every Cabinet meeting, but he always lost. He was a poor disputant; contention of any kind was distasteful to him, as having at best a touch of vulgarity about it…
At Washington’s request he continued to hold office in an ad interim fashion for a time, but a series of stirring events in the following year, 1793, determined him; he resigned on the last day of that year, and shortly afterwards went home. Washington’s Administration was headed straight for the rocks; and Mr. Jefferson, quite indisposed to martyrdom for a cause he did not believe in, went overboard and struck out for Monticello and safety.
o represent the French Revolution in terms of political theory, rather than in terms of economics, was highly advantageous for their immediate purposes; just as in the American Revolution it was advantageous for the New England traders to express their revolutionary doctrine in the political terms of the Declaration, rather than in terms of molasses, rum, codfish and the carrying trade, or the Virginians in terms of free land, tobacco and debts due British creditors.
The idea liberated by a successful revolution is always greater than the idea actually animating it.
The American and French Revolutions released upon the world the idea of the right of individual self-expression in politics; but neither was actually animated by that idea.
In the promotion of this myth, however, sincerity and interest played, as they always do, alternate and indistinguishable parts.
His mind was “slow in operation,” Mr. Jefferson said, “being little aided by invention or imagination,” and his education had been rudimentary, “merely reading, writing and common arithmetic, to which he added surveying at a later day.” He read little.
He was one of the richest men in the country, and though a Virginian and a planter, neither his instincts nor his pursuits were primarily those of a producer j his chief interests were in landholding and money-lending; and his predilections followed his interests no less closely, and no more, probably, than is the case with the average of upright men.
Paine’s bitter condemnation of him for having turned the country over to the tender mercies of monopolists and speculators merely wounded his sensibilities without ever reaching his understanding.
Why, to whom else should the country be turned over?—to the ignorant rabble of workingmen and farmers? He had done the best he could.
He was, in short, a thorough-going liberal of the best type, eager to see “with what dose of liberty man could be trusted for his own good,” but with all a liberal’s nervous horror of an overdose, and all a liberal’s naïve assumption of competent natural authority to prescribe and regulate the dose.
Washington set himself against the French. The treaty of 1778 did not trouble his conscience5 he had gone far enough in statecraft to become aware that a treaty is merely the memorandum of an accomodation of interests, usually made under duress, and that it imposes no moral obligation when the balance of those interests shifts.
He therefore announced that the treaty had been made with the French monarchy, now defunct, and that he could not recognize the right of a succeeding government to claim American assistance under its provisions.
Mr. Jefferson made the most of his three years retirement from the dishevelling squalor of routine politics. For a long time he did not even read the newspapers. He wrote his former colleague, Edmund Randolph, who had succeeded him as Secretary of State,
I think it is Montaigne who has said that ignorance is the softest pillow on which a man can rest his head. I am sure it is true as to everything political, and shall endeavour to estrange myself to everything of that character.
I indulge myself on one political topic only, that is, in declaring to my countrymen the shameless corruption of a portion of the representatives to the First and Second Congresses, and their implicit devotion to the Treasury. I think I do good in this, because it may produce exertions to reform the evil.
The figure of Adams is perhaps the most congenial— one may say perhaps the most lovable—of any made on the page of history by an American of his period. Franklin said, and Mr. Jefferson often quoted it with approval, that Adams was always an honest man, often a great man, and sometimes absolutely insane.
His faults were all faults of temper, they laid him continually open to deception, and betrayed him on occasion into incredible inconsistency and pettiness. He was vain, irascible, truculent, suspicious j and these faults were offset by a corresponding excess of the virtues that usually accompany them and are often, in a sense, coloured by them—even his integrity was pugnacious.
Not long before the campaign, Adams had published a large treatise on the theory of government, which marked him as a political tertium quid. He was for government by “the rich and well-born,” on the ground of their superior competence, but only under definite checks and restraints.
He frankly acknowledged that all politics rests on the basis of economics. He was therefore against democracy, because it meant that the poor and low-born would use politics to despoil the rich and well-born; and here, from a partisan point of view, he was sound.
But he also saw that an unchecked aristocracy would use politics to despoil the poor and low-born, and that by virtue of their superiority in intelligence and cunning, they would carry this spoliation to the point of mastery over all a country’s economic resources, and a consequent reduction of the poor and low-born to a state of living on sheer sufferance.
He was as much afraid of the rich, in short, as of the poor; and his book was an effort to devise a scheme of governmental mechanics which should impartially restrain the rapacity of both. Without such apparatus, he said,
The struggle will end only in a change of impostors. When the people, who have no other property, feel the power in their hands to determine all questions by a majority, they ever attack those who have property, till the injured men of property lose all patience and recur to finesse, trick and stratagem to outwit those who have too much strength, because they have too many hands to be resisted in any other way.
Mr. Jefferson apparently never believed that the important function of Constitutional interpretation should be vested in any one branch of the Government, probably perceiving that such an investiture would be equivalent to the establishment of an oligarchy.
He seems to have regarded Constitutional interpretation as an occasional function in the general system of checks and balances, to be exercised by the Legislature, Judiciary or even by the Executive, when- , ever one or another should display any tendency to usurpation or tyranny.
Our country has thought proper to distribute the powers of its government among three equal and independent authorities constituting each a check upon one or both of the others in all attempts to impair its Constitution
Hamilton’s general system, he saw, was a fixture. “We can pay off his debts in fifteen years,” he said, mournfully, “but we can never get rid of his financial system.”
If the government had only started differently—but a ship can not turn around in its own length.
“When the government was first established, it was possible to have kept it going on true principles, but the contracted, English, half-lettered ideas of Hamilton destroyed that hope in the bud.”
This was a characteristically sanguine view, and hardly tenable, underestimating as it does so grotesquely the lure of “public plunder.”
Hamilton’s achievement could not be seriously meddled with; one must trust to time and a wider-spread enlightenment for that.
Being an astute observer of human nature, Nock understood the lure of “public plunder” better than most people. However, I don’t believe “a wider-spread enlightenment” or any amount of education can resist this “lure.” As long as a group of people, regardless of how enlightened and educated they are, have the power to create money out of “thin air”, sooner or later they will succumb to the lure of “public plunder.”
That is why the invention of crypto-currency is so important for humanity. It makes it impossible for anyone to create money out of “thin air.” Without the power to create money at will, the government can no longer engage in “public plunder” through inflation (i.e. steal your money).
For the first time since Jefferson mournfully said “we can never get rid of his [Hamilton’s] financial system,” getting rid of his financial system became possible.
Bitcoin had a good chance of achieving that goal but it failed. Its lack of fungibility and privacy made it possible for govenrment to co-opt it. Only the privacy coints, i.e. crytp-corrency that was designed to protect the privacy of the user (e.g. Monero), can destroy the corrupt financial system that Jefferson thought was impossible to destroy.The Administration began its programme of economy, which Mr. Jefferson placed “among the first and most important of republican virtues,” with the appropriations for military purposes.
The army was cut down to a skeleton, and naval construction stopped—and thus perished the Federalists’ covert plans for summary dealing with proletarian insurrection at home andd told Madison four years before, that “the accounts of the United States ought to be, and may be, made as simple as those of a common farmer, and capable of being understood by common farmers.” .contested markets abroad.
The newly-created courts were abolished, and the Secretary of the Treasury, Gallatin, was set at work to rat-proof every avenue of access to public money.
He had told Madison four years before, that “the accounts of the United States ought to be, and may be, made as simple as those of a common farmer, and capable of being understood by common farmers.”…
“Alexander Hamilton,” Mr. Jefferson wrote in a memorandum to Gallatin,
in order that he might have the entire government of his [political] machine, determined so to complicate it that neither the President nor Congress should be able to understand it or to control him.
He succeeded in doing this, not only beyond their reach, but so that at length he could not unravel it himself.
He gave to the debt in the first instance, in funding it, the most artificial and mysterious form he could devise.
He then moulded up his appropriations of a number of scraps and remnants, many of which were nothing at all, and applied them to different objects in reversion and remainder, until the whole system was involved in impenetrable fog; and while he was giving himself the airs of providing for the payment of the debt, he left himself free to add to it continually, as he did in fact, instead of paying it.
Plain going was to be the rule. Along with the enormous reduction in governmental expenditure, went a considerable lightening of taxes on production….
Direct taxes of various kinds, projected in the war-fever of 1798, all went.
It was never thoroughly clear to Mr. Jefferson that this fiscal apparatus was contrived for America, by no means because it was British, but because there was money in it —because it was the most effective engine of exploitation by the “rich and well-born.”
The only essential difference between government by the “rich and well-born” in a hereditary aristocracy, as in the France of Mr. Jefferson’s day, and in a republic, is that the former is a closed corporation, while the latter, by an indefinite extension of the cohesive power of public plunder, admits a steady accession of outsiders.
At the end of his first term, he recapitulated the achievements of his Administration during four years of strict sticking to this noiseless course.
To do without a land tax, excise, stamp tax and the other internal taxes, to supply their place by economies so as still to support the government properly and to apply $7,300,000 a year steadily to the payment of the public debt;
to discontinue a great portion of the expenses on armies and navies, yet protect our country and its commerce with what remains;
to purchase a country as large and more fertile than the one we possessed before, yet ask neither a new tax nor another soldier to be added, but to provide that that country shall by its own income pay for itself before the purchase-money is due;
to preserve peace with all nations, and particularly an equal friendship to the two great rival Powers, France and England, and to maintain the credit and character of the nation in as high a degree as it has ever enjoyed;
are measures which I think must reconcile the great body of those who thought themselves our enemies
In 1800 he wrote Granger of his belief that “a single consolidated government would become the most corrupt government on earth” j and twentyone years later he remarked to Macon that “our Government is now taking so steady a course as to show by what road it will pass to destruction, to wit: by consolidation first, and then corruption, its necessary consequence. The engine of consolidation will be the Federal Judiciary; the other two branches the corrupting and corrupted instruments.”
He also wrote William Johnson in 1823 that there was no danger he apprehended so much as
the consolidation of our Government by the noiseless and therefore unalarming instrumentality of the Supreme Court.
This is the form in which Federalism now arrays itself, and consolidation is the present principle of distinction between Republicans and the pseudo-Republicans, but real Federalists.
Mr. Jefferson was almost in full view of it when he observed to Granger in 1800,
What an augmentation of the field for jobbing, speculating, plundering, office-building and officehunting would be produced by an assumption of all the State powers into the hands of the General Government!
Twenty-five years later, with almost his last breath, he speaks to Giles of those who
now look to a single and splendid Government of an aristocracy founded on banking institutions and moneyed corporations, under the guise and cloak of their favoured branches of manufactures, commerce and navigation, riding and ruling over the plundered ploughman and beggared yeomanry.
Here he comes plump upon the essential fact of a government fashioned for the distribution of wealth by political means rather than by economic means—for the economic exploitation of one class by another
Human nature…. “Man tends always to satisfy his needs and desires with the least possible exertion”.
Fore more see, Oppenheimer, political vs economic meansBut he did not recognize this fact when he saw it, for in his next sentence he reverts to his old bugbear—“This will be to them a next best blessing to the monarchy of their first aim, and perhaps the surest stepping-stone to it!”
Yet the only conceivable practical gain by monarchy is absolutism, and if absolutism can be effected quite as well by the native mechanism of a Federal Judiciary, why trouble to import the foreign mechanism of monarchy?
He saw the Judiciary, led by “a crafty chief judge who sophisticates the law to his mind by the turn of his own reasoning,” made up of non-elective officers installed for life and answerable to none—for impeachment, as he found in the case of Justice Chase, was “not even a scarecrow”—he saw these functionaries “construing our Constitution from a co-ordination of a general and special government to a general and supreme one alone. This will lay all things at their feet.”…
But he always lost. The Chief Justice’s
twistifications in the case of Marbury, in that of Burr and the Yazoo case, show how dexterously he can reconcile law to his personal biasses.
They showed more than that 5 they showed how completely the Chief Justice was in the economic tradition of the Fathers.
His decisions in these cases, with his subsequent decisions in the cases of McCulloch, Dartmouth College and Cohens, made the economic system of the United States, which was contemplated by the Constitution, formulated by Hamilton, put in operation by the Administrations of Washington and Adams, forever impregnable.
“The present principle of distinction between Republicans and the fseudo-Refublìcans> but real Federalists” One may pause upon these words. In his reflections on the schisms and defections that took place in his second term, discovering himself so much alone in his resistance to the surreptitious structural refashioning of the government, Mr. Jefferson, like Hamilton, failed to reckon with one most important effect of the cohesive power of public plunder.
With America opening as the land of unprecedented monopolist opportunity, men would of course be impelled to get out of the producing class and into the exploiting class as quickly as possible…
Mr. Jefferson never seemed aware that the prospect of getting an unearned dollar is as attractive to an agrarian as it is to a banker; to a man who owns timber or mineral deposits as it is to one who owns governmental securities or who profits by a tariff.
For this reason he could not understand why Republicanism almost at once became a mere name.
Nothing could be more natural, however, than for Republicans who saw any chance of participation in monopoly to retain the name and at the same time resist any tendency within the party to impair the system that held out this prospect.
The certain course of political development, therefore, was towards bipartisanship; nothing could stop it.
Party designation would become, like ecclesiastical designation, a merely nominal matter, determined by family tradition, local or sectional habit, or other causes as insignificant as these.
The stated issues between parties would become progressively trivial, and would more and more openly tend to be kept up merely to cover from scrutiny the essential identity of the parties.
The effect of this upon the practical conduct of politics would precisely correspond to that which Mr. Jefferson remarked in England.
The nest of office being too small for all of them to cuddle into at once, the contest is eternal which shall crowd the other out. For this purpose they are divided into two parties, the Ins and the Outs
Mr. Jefferson did not distinguish this process of development, even though it went on before his eyes.
They embrace respectively the following descriptions of persons.
The anti-Republicans consist of:
The Republican part of our Union comprehends:
Nothing could be more obvious than the generalizations to be made from this, but more than intelligence was needed, to make them. The co-operation of the Zeitgeist was needed, and this was not yet to be had.
He admired their anarchist polity and their highly integrated sense of manners; it was his observation of these that put into his mind the great idea that in so far as mankind needs any kind of government at all, it should be governed by customs rather than by laws.
As a rule, Mr. Jefferson took a pretty strictly practical view of language, as little more than something whereby one gets oneself understood.
“I do not pretend that language is science. It is only an instrument for the attainment of science.”
The chief object of learning a language is to get a command of its literature, and the earlier one gets at languages, the better, since getting at them is so largely a matter of memory.
“In general, I am of opinion that till the age of about sixteen we are best employed on languages.”
Still, the rule was not invariable j he had done most of his own learning o£ living languages after sixteen.
At the time of the Constitutional Convention, or even before, it was plain that by virtue of their superiority in mobility, in power of organization and in wealth, “the rich and well-born” would easily take command over the institutional voices o£ the new American society, and cause them to say what they wished said¿ and that with this would go a rapidly-developing technique of suppression and misrepresentation.
It was a matter of great regret to Mr. Jefferson that no history of the Revolution, other than a mere chronology of external facts, could ever be written,
all its councils, designs and discussions having been conducted by Congress with closed doors, and with no members, as far as I know, having even made notes of them….
Thus it was, he remarked, that
man is fed with fables through life, leaves it in the belief he knows something of what has been passing, when in truth he knows nothing but what has passed under his own eye.
He foresaw a protracted and diligent indoctrination of the public, an unquestioned sway of myth and legend over the popular imagination, in support of the politico-economic system of the United States.
We have been too careless of our future reputations, while our tories will omit nothing to place us in the wrong.
Besides the five-volumed libel [Marshall’s Life of Washington] which represents us as struggling for office, . . . the life of Hamilton is in the hands of a man who to the bitterness of the priest adds the rancour of the fiercest Federalism. . . . And doubtless other things are in preparation, unknown to us.
On our part, we are depending on truth to make itself known, while history is taking a contrary set which may become too inveterate for correction.
The cohesive power of public plunder, the appeal of America as the “land of opportunity” to get rich by the uncompensated appropriation of the labour-products of others, by methods of speculation, monopoly and forestalling— these would confirm contemporary history in its “contrary set.”
More than this, they would give direction to the whole institutional life of the country, to schools and colleges, the pulpit and the forum, to all forms of social organization, and especially to what Mr. Jefferson called the “cannibal newspapers.” True, the years are never unjust, if one but reckon on enough of them—the selfpreserving instinct of humanity attends to that—but while waiting for their justice, there is little else that one can do.
The second measure which Mr. Jefferson had at heart was “that of general education, to enable every man to judge for himself what will secure or endanger his freedom.”
his was a return to an old love. When he was employed in revising the Virginia Statutes, in 1797, he drew up a remarkable bill for a system of public schools. In the vulgar sense of the term—the sense by which anything merely indiscriminate may be called democratic—it was far from a democratic system.
Mr. Jefferson’s notion of the limitation of education at public expense was as explicit as his notion of a limited suffrage, which he set forth at the same time.
Like his contemporary, the Iron Duke, he was well aware that it was possible for a man’s education to be too much for his abilities.
His bill provided that each ward in the county should have a school, open to all for instruction in reading, writing and common arithmetic.
Each year, Each year, “the boy of best genius in the school”—the girls, apparently, were out of reckoning —was to be picked out and sent to the grammar school, of which there were to be twenty, conveniently placed in the State.
This elite of the primary schools should be continued at the grammar school one or two years and then dismissed, with the exception of “the best genius of the whole,” who should be continued six years.
“By this means,” said Mr. Jefferson, “twenty of the best geniuses will be raked from the rubbish annually.”
At the end of six years, the best half of the twenty were to be sent to William and Mary, and the rest turned adrift.
Children who paid their way might have use of the schools without restriction: this selective system showed only how far Mr. Jefferson thought the State’s responsibility for free popular education should extend, and the directions in which it should be discharged.
Throughout his life, Mr. Jefferson consistently maintained that
“the most effectual means of preventing the perversion of power into tyranny are to illuminate as far as possible the minds of the people.”
He had no doubt that “if a nation expects to be ignorant and free, . . . it expects what never was and never will be.”
He seems never to have suspected, however, the ease with which mere literacy is perverted, and that it is therefore quite possible for a literate people to be much more ignorant than an illiterate people—that a people of well-perverted literacy, indeed, is invincibly unintelligent.
“What first put me on track of it was a remark by one of my old professors. He said that there were people so incompetent, so given to reading with their eyes and their emotions instead of with their brains, that they would accuse the Psalmist of atheism because he had written, “The fool hath said in his heart, There is no God.” (Memoirs of a Superfluos Man, Albert Nock).
Most peole read with their eyes and emotions only. If they were able to read with their brains, conditioning and propaganda would not be so effective.His idea of literacy was mechanical, and he insisted on it mechanically; and he is thus, perhaps, as much as any one responsible for the general and calamitous over-confidence in literacy which prevailed in America unquestioned during the century that followed him.
The astonishing exaggeration of his own confidence in literacy may be seen in a letter to the Chevalier de Ouis, in 1814, congratulating him upon the provision in the new Constitution of Spain, which disfranchised, after a certain time, all citizens who could not read and write This, he said,
is the fruitful germ of the improvement of everything good, and the correction of everything imperfect in the present Constitution. This will give you an enlightened people, and an energetic public opinion which will control and enchain the aristocratic spirit of the government
Mr. Jefferson had already sold his library. When the first Congressional Library was burned by the British in 1814, he offered his books to Congress at their own price, as the nucleus of a new collection. The Congress behaved a good deal better about this, on the whole, than one would expect. They wrangled a good deal.
It was said that some of Mr. Jefferson’s books were of an immoral and atheistical tendency. They had been told that his library contained one book at least, maybe more, by a man named John Locke, and something by another man named Rousseau, who was thought to be a Frenchman.
These were reputed to be subversive, perhaps specifically, perhaps only in a general way—they were under suspicion, at all events—and it would be a matter of evil example for the Congress to buy them and make them accessible.
Furthermore, many of Mr. Jefferson’s books were printed in foreign languages, and therefore of no use whatever to the members of Congress…
The Congress accordingly appraised the library at a little under twenty-four thousand dollars j Mr. Jefferson accepted the offer and nev©r permitted himself to comment upon it.
He threw in a catalogue and a classification for good measure, gratis 5 and his classification remained in official use in the Library of Congress for seventy-five years.