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In early 1782, the Siege of Yorktown was over, but the British government had not yet admitted defeat. Without hindsight, it was impossible to know whether or not the Revolutionary War would continue. How do you plan your life when the state of your nation is in such flux?
Hamilton on the state of the nation
In a long letter written during the spring of 1782 to the Vicomte de Noailles, who had served with him at Yorktown, Hamilton gave an overview of the United States six months after Cornwallis’s surrender – including how the government established by the Articles of Confederation was faring.
The period since you left us has been too barren of events to enable me to impart any thing worth attention. The enemy continues in possession of Charleston and Savannah … Many are sanguine in believing that all the southern posts will be evacuated, and that a fleet of transports is actually gone to bring the garrisons away; for my part, I have doubts upon the subject. [NOTE: The British evacuated Savannah in July 1782 and Charleston in December 1782.] My politics are, that while the present [British] ministry can maintain their seats and procure supplies, they will prosecute the war on the mere chance of events; and that while this is the plan, they will not evacuate posts so essential as points of departure, from whence, on any favourable turn of affairs, to renew their attack on our most vulnerable side; nor would they relinquish objects that would be so useful to them, should the worst happen in a final negotiation.
[General Henry] Clinton, it is said, is cutting a canal across New-York island, through the low ground about a mile and a half from the city. This will be an additional obstacle; but if we have otherwise the necessary means to operate, it will not be an insurmountable one. I do not hear that he is constructing any other new works of consequence. To you who are so thoroughly acquainted with the military posture of things in this country, I need not say that the activity of the next campaign must absolutely depend on effectual succours from France. I am convinced we shall have a powerful advocate in you. La Fayette, we know, will bring the whole house with him if he can.
There has been no material change in our internal situation since you left us [in late December 1781]. The capital successes we have had, have served rather to increase the hopes than the exertions of the particular states. But in one respect we are in a mending way. Our financier [Robert Morris] has hitherto conducted himself with great ability, has acquired an entire personal confidence, revived in some measure the public credit, and is conciliating fast the support of the moneyed men.
His operations have hitherto hinged chiefly on the seasonable aids from your country; but he is urging the establishment of permanent funds among ourselves; and though, from the nature and temper of our governments, his applications will meet with a dilatory compliance, it is to be hoped they will by degrees succeed. The institution of a bank has been very serviceable to him. The commercial interest, finding great advantages in it, and anticipating much greater, is disposed to promote the plan; and nothing but moderate funds, permanently pledged for the security of lenders, is wanting to make it an engine of the most extensive and solid utility.
By the last advices, there is reason to believe the delinquent states will shortly comply with the requisition of congress for a duty on our imports. This will be a great resource to Mr. Morris, but it will not alone be sufficient.
Upon the whole, however, if the war continues another year, it will be necessary that congress should again recur to the generosity of France for pecuniary assistance. The plans of the financier cannot be so matured as to enable us by any possibility to dispense with this; and if he should fail for want of support, we must replunge into that confusion and distress which had like to have proved fatal to us, and out of which we are slowly emerging. The cure in a relapse would be infinitely more difficult than ever. (More here)
The financial status of the United States
When we left Hamilton last week, he had decided to study law, and was designing a crash course for himself. In July 1782, he passed the bar. But being Alexander, he also had several other irons in the fire.
Between May 1781, when he resigned from Washington’s staff, and September 1781, when he camped out with the army at Yorktown, Hamilton published four issues of The Continentalist. In them he argued in favor of a strong central government. On April 18 and July 4, 1782, the final two issues appeared, introduced by a wry note:
The succeeding numbers of the Continentalist were written last fall, but accidentally got out of the possession of the writer. He has lately recovered them, and he gives them to the public more to finish the development of his plan, than from any hope that the temper of the times will adopt his ideas. (Here, n. 1)
In Continentalist no. 5, Hamilton contended that the nation must preserve its balance of trade. His opening salvo berated those who believe government has no part in commerce:
There are some, who maintain, that trade will regulate itself, and is not to be benefitted by the encouragements, or restraints of government. Such persons will imagine, that there is no need of a common directing power. This is one of those wild speculative paradoxes, which have grown into credit among us, contrary to the uniform practice and sense of the most enlightened nations. Contradicted by the numerous institutions and laws, that exist every where for the benefit of trade, by the pains taken to cultivate particular branches and to discourage others, by the known advantages derived from those measures, and by the palpable evils that would attend their discontinuance—it must be rejected by every man acquainted with commercial history. Commerce, like other things, has its fixed principles, according to which it must be regulated; if these are understood and observed, it will be promoted by the attention of government, if unknown, or violated, it will be injured—but it is the same with every other part of administration.
To preserve the ballance of trade in favour of a nation ought to be a leading aim of its policy. (More here)
NOTE: This is straight mercantilist theory, which assumes wealth is a zero-sum game, and that a nation must have a favorable balance of trade in order to survive and prosper. To justify laissez-faire capitalism at its root, one needs arguments that depend on philosophy, not economics: and the philosophy wasn’t worked out until quite a long time after 1782. More on Hamilton and laissez-faire in a future post (Hamilton Musical 62).
In Continentalist no. 5, Hamilton goes on to justify his argument for government regulation of trade with examples of how England, France, and the Dutch governments encouraged trade. Then he explains why the individual states in America cannot be expected to do the same. In Continentalist no. 6, Hamilton discusses the different types of tax (property, poll, customs). He ends the series with a swipe at the states and their petty squabbling:
There is something noble and magnificent in the perspective of a great Fœderal Republic, closely linked in the pursuit of a common interest, tranquil and prosperous at home, respectable abroad; but there is something proportionably diminutive and contemptible in the prospect of a number of petty states, with the appearance only of union, jarring, jealous and perverse, without any determined direction, fluctuating and unhappy at home, weak and insignificant by their dissentions, in the eyes of other nations. Happy America! if those, to whom thou hast intrusted the guardianship of thy infancy, know how to provide for thy future repose; but miserable and undone, if their negligence or ignorance permits the spirit of discord to erect her banners on the ruins of thy tranquillity! (More here)
Hamilton’s first political post: tax receiver for New York State
But wait: there’s more. While Hamilton studied for the bar, kept up his correspondence, and submitted the last two Continentalist essays for publication, he was also taking on his first civilian job in government. On May 18, 1782, he turned down an offer from Robert Morris (the U.S. Superintendent of Finances) to become tax receiver for New York State. The tax receiver (a position created by Morris) was to be responsible for collecting taxes and turning over the federal government’s share. His pay would be a small percentage of tax revenues.
In the letter below, notice that in the midst of his frenetic legal studies, Hamilton has somehow got his hands on the approximate amount of taxes due from New York to the federal government. He’s also assessed the likelihood that the taxes will be paid.
And by the way .. this is 1782. There is no Internet, no Express Mail, no telephone; no planes, trains, cars. To get this information, Hamilton had to either drop his legal studies and gallop off to Poughkeepsie in hopes of digging up the information on his own – or he had to reach out to the sort of prominent men who might know it. Based on his considerable correspondence, I suspect that Hamilton had spent a lot of time building such relationships, so that when he asked questions, he got prompt replies.
My military situation has indeed become so negative that I have no motive to continue in it; and if my services could be of importance to the public in any civil line I should chearfully obey its command. But the plan which I have marked out to myself is the profession of the law; and I am now engaged in a course of studies for that purpose. Time is so precious to me that I could not put myself in the way of any interruptions unless for an object of consequence to the public or to myself. The present is not of this nature. Such are the circumstances of this state, the benefit arising from the office you propose would not during the war exceed yearly one hundred pounds; for unfortunately, I am persuaded it will not pay annually into the Continental treasury above forty thousand pounds; and on a peace establishment this will not be for sometime to come much more than doubled. You will perceive Sir that an engagement of this kind does not correspond with my views and does not afford a sufficient inducement to relinquish them.
I am not the less sensible to the obliging motives which dictated the offer, and it will be an additional one to that respect and esteem with which I have the honor to be very truly Sir Yr. most Obed & humble servant (More here)
Morris apparently wanted Hamilton in the tax-receiver position enough to make another offer. He promised Hamilton not .25% of taxes collected, but .25% of taxes due. Hamilton replied on June 17, 1782 (about a month before he took the bar):
The explanation you give of your intention in your late offer makes it an object that will fully compensate for the time it will deduct from my other occupations. In accepting it I have only one scruple, arising from a doubt whether the service I can render in the present state of things will be an equivalent for the compensation. The whole system (if it may be so called) of taxation in this state is radically vicious, burthensome to the people and unproductive to government. As the matter now stands there seems to be little for a Continental Receiver to do. The whole business appears to be thrown into the hands of the County treasurers. … There is only one way in which I can imagine a prospect of being materially useful that is in seconding your applications to the State. In popular assemblies much may sometimes be brought about by personal discussions, by entering into details and combating objections as they rise. If it should at any time be thought adviseable by you to empower me to act in this capacity, I shall be happy to do every thing that depends on me to effectuate your views. …
It is of primary moment to me as soon as possible to take my station in the law, and on this consideration I am pressing to qualify myself for admission the next term which will be the latter end of July. After this if you should think an interview with me necessary I will wait upon you in Philadelphia. In the mean time I shall be happy to receive your instructions, and shall direct my attention more particularly to acquiring whatever information may be useful to my future operations. … A meeting of the Legislature is summoned early in the next month [July 1782] at which, if I previously receive your orders, it may be possible to put matters in train. (More here)
By the end of July – the same month he passed the bar – Hamilton had accepted the position of tax receiver for New York State, and had begun operating with the same ferocious efficiency he displayed on Washington’s staff. He wrote to Gerard Bancker, treasurer of the state of New York, asking for details on the taxes New York owed to the federal government (here). He followed up with a letter to Governor George Clinton asking for his cooperation regarding taxes, using a combination of flattery and shame.
Your Excellency must have been too sensible of the necessity of enabling the Director of the Finance of the United States to form a just judgment of the true state of our affairs to have omitted any measure in your power to procure the fullest information on the several matters submitted to you and I am persuaded the business is in such a train that little will be left for me to do. (More here)
He wrote to the county treasurers of New York State in much the same vein on August 5, 1782:
When I assure you I want this information for an important purpose I doubt not you will forward it to me as speedily as it can be prepared and with as much accuracy as circumstances will permit … (More here)
Meanwhile, on August 1, 1782, Hamilton (as “Receiver of Continental Taxes for the State of New-York”) published a statement in the New-York Packet that he had received no monies from New York State. Perhaps he hoped to shame the state’s politicians into action.
Corruption in New York
On August 13, 1782, barely three months after he began to consider the position of tax receiver and a only few weeks after he assumed the post, Hamilton sent Morris a 4,000-word “full view of the situation and temper of this state.” He estimated the damage to New York State’s economy from the war:
It will not be difficult to conceive this, when we consider, that five out of the fourteen counties of which the state was composed, including the capital, are in the hands of the enemy—that two and part of a third have revolted—two others have been desolated, the greater part, by the ravages of the enemy and of our own troops—and the remaining four have more or less suffered partial injuries from the same causes. Adding the fragments of some to repair the losses of others, the efficient property, strength and force of the state will consist in little more than four counties.
New York, says Hamilton, made great expenditures during the war (sometimes “from want of judgment, at others from necessity”), and the resultant taxes have “both distressed and disgusted the people.” Its frontier is in danger of attack by Indians and British. With New York City under enemy control, there is no foreign trade. The balance of trade is against New York, and cash is exceedingly scarce.
Furthermore, the New York State government is in bad shape.
Here we find the general disease which infects all our constitutions, an excess of popularity. There is no order that has a will of its own. The inquiry constantly is what will please not what will benefit the people. In such a government there can be nothing but temporary expedient, fickleness and folly.
Nothwithstanding the obvious defects of this system, notwithstanding experience has shown it to be iniquitous and ineffectual and that all attempts to amend it without totally changing it are fruitless, notwithstanding the⟨re⟩ is a pretty general discontent from the inequality of the taxes, still ancient habits, ignorance, the spirit of the times, the opportunity afforded to some popular characters of skreening themselves by intriguing with the assessors, have hitherto proved an over-match for common sense and common justice as well as the manifest advantage of the State and of the United States.
Hamilton proceeds to give Morris brief, witty, amusing sketches of the main figures in New York government. For example:
[Judge Pain] is a man of strong natural parts and as strong prejudices; his zeal is fiery, his obstinacy unconquerable. He is as primitive in his notions, as in his appearance. Without education, he wants more knowlege, or more tractableness.
Oh, dear, don’t we all know people like that?
Hamilton sums up his report to Morris with an estimate of how much New York State will collect in tax revenues, and how much of that total Morris might reasonably expect to have for the federal government. (Whole letter here.)
From August until early November, Hamilton did his utmost to collect taxes, sending frequent updates to Robert Morris (9/28/1782, 10/5/1782, 10/9/1782). On November 9, 1782, he had the pleasure of publishing in the New York Packet that he had received on behalf of the federal government $6,434.10.
By that time, Hamilton was about to resign his position as tax receiver for New York State: he had bigger fish to fry. At some point in July, he went to the state legislature, as he had offered to do in his letter to Morris of mid-June: “In popular assemblies much may sometimes be brought about by personal discussions, by entering into details and combating objections as they rise … A meeting of the Legislature is summoned early in the next month [July] at which … it may be possible to put matters in train” (here). I haven’t seen any contemporary account of Hamilton’s visit to the state legislators. Whatever he said, it made such an impression that in July, they appointed him as one of New York’s five delegates to the Continental Congress in Philadelphia.
As of the first Monday of November, 1782, Hamilton was moving back onto the national stage.
- On Sunday November 6, 2016, I’ll be giving my talk “Hamilton: Man & Musical” in New York City ($35 at door, $30 in advance). It combines excerpts from Hamilton’s writings with the chance to burst into song. Space is limited. Details here.
- The year 1782 makes me think of the last two lines of O’Shaughnessy’s “Ode”: “For each age is a dream that is dying, / Or one that is coming to birth.” If you’re thinking you’ve heard me quote the “Ode” before, you’re right. Rereading my essay “On Studying History” reminds me, pleasantly, of the days when I homeschooled my daughter; and, less pleasantly, that if I had time and leisure (is that redundant?), I could write a blow-you-all-away history textbook.
- I’ve started adding comments based on these blog posts to the Genius.com pages on the Hamilton Musical: a fantastic resource. Follow me @DianneDurante.
- The usual disclaimer: This is the forty-first in a series of posts on Hamilton: An American Musical. My intro to this series is here. Other posts are available via the tag cloud at lower right. If you’ve read this far and enjoyed it, why not sign up to hear about future installments? Follow me on Twitter @NYCsculpture, friend the Forgotten Delights page on Facebook, or ask to be added to my mailing list (email DuranteDianne@gmail.com), which will get you a weekly email with some bonus comments. Bottom line: these are unofficial musings, and you do not need them to enjoy the musical or the soundtrack.
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