Alexander Hamilton, "the Celebrated Mr. Neckar," and Public Credit

Abstract

I N a season of bicentennial observances we should recall that i990 is the two-hundredth anniversary of a series of reports directed by Alexander Hamilton, secretary of the treasury, to the United States Congress and that these documents influenced considerably the course that the new nation would follow. The most important by far was the Report Relative to a Provision for the Support of Public Credit (submitted January I4, I790), for out of it emerged policies that led to the establishment of public credit. In another report that year (December I3), Hamilton proposed to Congress what was to become the Bank of the United States.1 Less well remembered, at least in the United States, is the resignation from office that same year of the French finance minister Jacques Necker, whose influence on Hamilton we shall explore in due course. If it is customary to tie Hamilton's name to a national bank, so much the more has his name become synonymous with the national debt. Indeed, that debt is often portrayed as Hamilton's way of binding the propertied classes to the new nation. Moreover, a bank was bound to enhance the power and prestige of the national government. The bank is often identified with the public credit in some way, and thus everything fits together neatly in support of Hamilton's nationalist vision. Stated as it often is in summary form, this version leaves no room for qualification: for example, did all the propertied classes really benefit from Hamilton's program? Hamilton has been typecast; his views seem frozen in time, systematic and consistent rather than responsive to unforeseen circumstances. Once committed to a particular view of a national bank or a national debt, he must remain so. But, if one believes Hamilton's own words, he did change his mind: the bank is a case in point. A national bank tends to increase public credit, Hamilton wrote in I78i, several years before assuming office at the treasury. There is no