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Ch. 7 Sec. 2 “Hamilton & National Finances” P. 238-242

POWERPOINT NOTES

Ch. 7 Sec. 2 “Hamilton & National Finances” P. 238-242

• Settling the Debt:

• Alexander Hamilton- Sec. of Treasury

• National debt- money owed by the U.S. from Revolutionary War.

• Foreign- $11.7 million

• U.S. Citizens- $40.4 million

• Bonds- certificates od debt that carry a promise to buy back the bonds at a higher price.

• Sold at lower price to speculators who would sell at higher price later.

• Jefferson thought it cheated bondholders.

Ch. 7 Sec. 2 “Hamilton & National Finances” P. 238-242

• Settling the Debt: (Cont.)

• Hamilton wanted to pay off state war debt.

• States would have money to develop business and trade

• South didn’t agree, many had paid debt already.

• Compromise:

• Move capital of nation to South.

• 10 years to Philadelphia, then along Potomac River (D.C.)

Ch. 7 Sec. 2 “Hamilton & National Finances” P. 238-242

Hamilton:

• Strong Central Government

• Promoted Manufacturing/business

• Wanted protective tariffs

• Raise prices of foreign goods.

• Protect U.S. business from foreign competition, buy American.

• Start a National Bank

• National mint, issue money

• 20 year charter, states start own banks

• “Loose” interpretation of Constitution

• Elastic clause gave power for bank

Jefferson:

• Right of people to rule country

• Farming/agriculture

• Low tariffs to keep prices low

• Against the National Bank

• Gave too much power to national gov’t

• “Strict” interpretation of Constitution

• Word for word in Constitution

Ch. 7 Sec. 2 “Hamilton & National Finances” P. 238-242

• A National Bank: (Cont.)

• George Washington supported Hamilton’s Plan.

• Hoped would stabilize the economy

• 1791, Congress enacted the charter for Bank of the U.S.

• 1st National Bank