Federalist Party

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adopted a small tariff on imports. This was a start but not nearly enough. The government needed this money to maintain its own existence and to be able to pay of the debt. The existence of the government was a necessity, but there was a lot of discussion as to whether the debt should be payed off.

The mare magnitude of the debt seemed to compel some measure of avoidance. In 1789, the national debt totaled more than $50 million, $11,700,000 of which was owed to France and Spain and the private bankers of Netherlands, while $40 million was in the form of securities held by citizens of the United States. The interests owed to the bankers were being payed off by loans from the bankers themselves. The government didn't even have enough money to pay the Barbary corsairs for release of captive sailors!

When Congress couldn't come up with a solution that was satisfactory, they turned to Alexander Hamilton with the dilemma. He soon proceeded to draw up a full report entitled ...

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engine in the management of the finances, and would quickly become a convert to its perfect constitutionality." This plan favored the central government.

The bank made little banks, who couldn't compete, go out of business. The rich ended up being able to buy a part in the bank and so got richer, and the poor and middle class didn't get the benefits. The central government was becoming self sufficient, and less dependent on the states.

What Hamilton did is make the nation stronger in the eyes of other nations. This is a great accomplishment. If the Federalists (they didn't call themselves that until 1792) weren't in power the nation would have been weaker and more ...

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