Alexander Hamilton (66 page)

The ideological differences between Hamilton and Jefferson did not blaze into sudden, open enmity. In their early days in the cabinet, these erudite men held many private talks, with Jefferson hoarding statements by Hamilton that he later used against him. As a courtly gentleman of impeccable manners, Jefferson shrank from disagreement. Unlike Hamilton, a swashbuckler who reveled in debate, Jefferson hated controversy and was more guarded than Hamilton in exposing his thoughts. He suited his words to the occasion and catered to listeners’ prejudices, saying what they wanted to hear. This kept his own views secret while encouraging others to speak. Hamilton—opinionated, almost recklessly candid—was incapable of this type of circumspection. Jefferson had learned the advantages of inscrutable silence. While serving with Jefferson in the Continental Congress, recalled John Adams, “I never heard him utter three sentences together.”
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On another occasion, Adams labeled the Virginian a “shadow man” and likened his character to “the great rivers, whose bottoms we cannot see and make no noise.”
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For Hamilton, unable to govern his tongue or his pen, his habit of self-exposure eventually placed him at the mercy of the tightly controlled Jefferson.

Jefferson’s horror over the discrimination defeat led to the first major political alignment in the infant republic as Jefferson made common cause with Madison, now the House floor leader. Their partnership was to have ramifications for America’s future as important as the earlier one beween Hamilton and Madison. Of the nearly mystic bond between Jefferson and Madison, John Quincy Adams said it was “a phenomenon, like the invisible and mysterious movements of the magnet in the physical world.”
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Since Hamilton’s relationship with Madison had revolved around ideas, there was little personal chemistry to sustain their friendship when they fell out over politics. Madison’s defection was a tremendous blow for Hamilton, who had consulted him in the early stages of his
Report on Public Credit.
So boundless was Hamilton’s respect for Madison that he later said that he would never have accepted the Treasury post had he not believed that he could count on his general support.

Jefferson arrived in New York in the thick of the debate raging over assumption—Hamilton’s plan to have the federal government assume the twenty-five million dollars of state debt. This venomous clash made the fight over discrimination look civilized, and Jefferson later categorized it as “the most bitter and angry contest ever known in Congress before or since the union of the states.”
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On February 24, 1790, Hamilton had been stunned when Madison, reversing his former position, contested assumption. Retreating from his old nationalist perspective, Madison complained that his home state and some other southern states had paid off most of their wartime debts and would be penalized if, “after having done their duty,” they were forced “to contribute to those states who have not equally done their duty.”
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To Hamilton, it seemed that Madison spoke for his Virginia constituents and not, as in
The Federalist,
for the national good. (Of course, as treasury secretary, Hamilton enjoyed the luxury of a continental view.) Hamilton was blind-sided by this backlash against his program; that Madison led it was an unkind cut. Hamilton plainly recalled discussing assumption with Madison during an “afternoon’s walk” at the Constitutional Convention, and “we were perfectly agreed in the expediency and propriety of such a measure.”
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Madison’s physical appearance—his pale, unsmiling visage, his detached air and short stature—transmitted a superficial impression of timidity. And some fellow politicians believed that “Little Jemmy,” as he was known, lacked the commanding, decisive air of a successful politician. His mental vigor, unlike Hamilton’s, was not matched by a corresponding talent for translating thought into action. “His great fault as a politician appears to me a want of decision and a disposition to magnify his adversaries’ strength,” Congressman Edward Livingston told his brother, Robert R. Livingston. “He never determines to act until he is absolutely forced by the pressure of affairs and then regrets that he has neglected some better opportunity.”
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So powerful was this appearance of timidity that many observers were convinced that Madison, eight years younger than Jefferson, must have been dominated by his shrewd mentor. “Mr. Madison had always entertained an exalted opinion of the talents, knowledge and virtues of Mr. Jefferson,” Hamilton later wrote. But he thought that, at bottom, each man stiffened the other’s determination in opposing his funding program: “Jefferson was indiscreetly open in his approbation of Mr. Madison’s principles upon his first coming to the seat of Government. I say indiscreetly because a gentleman in the administration of one department ought not to have taken sides against another in another department.”
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The impression that Jefferson controlled Madison could be misleading, and not only because Madison deserted Hamilton before Jefferson even arrived in New York. Like Jefferson, Madison operated in the shadows and relied on subtle craft and indirection. His professorial air masked an iron will and a fanatical sense of conviction. Albert Gallatin, later treasury secretary under Jefferson and Madison, was to call Madison “slow in taking his ground, but firm when the storm rises.”
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If anything, Madison had a more supple and original mind than Jefferson and a deeper grasp of constitutional issues. If Madison in the 1780s was a philosopher king, Madison in the 1790s was a formidable practicing politician and so skillful at cutting deals that he was dubbed “the Big Knife.” Hamilton’s followers, who feared Madison’s ability to marshal votes, later called him “the general” and Jefferson “the generalissimo.”
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Congressman Zephaniah Swift of Connecticut later confirmed that Madison’s lack of Hamiltonian verve could be deceptive:

He has no fire, no enthusiasm, no animation, but he has infinite prudence and industry. [With] the greatest apparent candor, he calculates upon everything with the greatest nicety and precision. He has unquestionably the most personal influence of any man in the House of Representatives. I never knew a man that better understood [how] to husband a character and make the most of his talents. And he is the most artificial, studied character on earth.
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On four separate occasions between February and July 1790, the dexterous Madison thwarted attempts to enact assumption. People whispered into Hamilton’s ear that Madison was jealous of his power, that Madison coveted his job. Time showed that political differences dwarfed personal considerations. Hamilton’s funding plan brought state loyalties to the surface. Some states, such as Massachusetts and South Carolina, struggled with heavy debts and were glad to be relieved by the central government. Others, such as Virginia and North Carolina, had settled most of their debts and saw no reason to help. Such differences threatened to explode the brittle consensus that had been so arduous to reach at the Constitutional Convention.

In defending his plan, Hamilton did not speak just in arid technical terms. He talked of justice, equity, patriotism, and national honor. His funding system was premised upon a simple concept: that the debt had been generated by the Revolution, that all Americans had benefited equally from that revolution, and that they should assume collective responsibility for its debt. If state debts were unequal, so were the sacrifices made during the fighting. Praising the “immense exertions” of indebted Massachusetts, for instance, Hamilton stated, “It would not be too strong to say that they were in a great degree the pivot of the revolution.”
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Some states, he noted, had paid their debts by ignoble means. New York, for instance, had reneged on interest payments to drive down the market value of its debt, making it cheaper for the state to buy it back. Hamilton also made a subtle, sophisticated argument that without assumption, indebted states would have to raise their taxes, while healthy states would lighten their tax loads. This would trigger a dangerous exodus of people from high-tax to low-tax states, producing “a violent dislocation of the population of particular states.”
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For Hamilton, assumption was his make-or-break issue, and the outlook seemed grim. Hamilton recalled, “It happened that Mr. Madison and some other distinguished characters of the South started in opposition to the assumption. The high opinion entertained of them made it be taken for granted in that quarter that the opposition would be successful.”
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Hamilton threw himself into battle with his accustomed impetuosity. In this exceptionally hard fight, Hamilton had to lead the charge without Washington. The president supported assumption but did not want to be accused of partisanship and so hesitated to express a public opinion. To aggravate the problem, Washington was laid low in May with an attack of pneumonia so debilitating that, Jefferson said, he was “pronounced by two of the three physicians present to be in the act of death…. You cannot conceive of the public alarmon this occasion.”
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From May 10 to June 24, Washington was too feeble to record an entry in his diary, and Hamilton seemed to function as the de facto head of state. In unpublished comments on this period, Hamilton accused Jefferson of harboring presidential wishes during the interregnum:

Mr. Jefferson fears in Mr. Hamilton a formidable rival in the competition for the presidential chair at a future period…. After he [Jefferson] entered on the duties of his station, the President was afflicted with a malady which while it created dismay and alarm in the heart of every patriot only excited the ambitious ardor of the secretary to remove out of his way every dangerous opponent. That melancholy circumstance suggested to him the probability of an approaching vacancy in the presidential chair and that he would attract the public attention as the successor to it were the more popular Secretary of the Treasury out of the way.
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Perhaps Hamilton decided to suppress this recollection because it revealed his own presidential fantasies as well as Jefferson’s.

During Washington’s illness, Hamilton and his minions, in a tremendous display of organizational skill, accosted congressmen and proselytized for assumption. The treasury secretary became a ubiquitous figure at Federal Hall, packing the gallery with supporters. Nobody was more offended than William Maclay. In his journal, he castigated Hamilton as “his Holiness” and on another occasion called him “a damnable villain.”
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(Hamilton got off easy: John Adams reminded Maclay of “a monkey just put into breeches.”)
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On account of his whirling energy, Hamilton encountered enormous resistance from congressmen fearful of a strong executive branch. His activities brought to mind Robert Walpole, Britain’s chancellor of the exchequer in the 1720s, who achieved such omnipotence that he was the first to acquire the title of “prime” minister. In Philadelphia, Benjamin Rush deplored Hamilton’s high-pressure lobbying: “I question whether more dishonourable influence has ever been used by a British Minister (bribery excepted) to carry a measure than has [been] used to carry the report of the Secretary. This influence is not confined to nightly visits, promises, compromises, sacrifices, and threats in New York.”
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Alexander Hamilton was trying through his assumption plan to preserve the union, and yet nobody, for the moment, seemed to be widening its divisions more. If politics is preeminently the art of compromise, then Hamilton was in some ways poorly suited for his job. He wanted to be a statesman who led courageously, not a politician who made compromises. Instead of proceeding with small, piecemeal measures, he had presented a gigantic package of fiscal measures that he wanted accepted all at once.

As the newspaper war against Hamilton heated up, Madison’s backers scented victory. On April 8, William Maclay gloated over the gloom of Hamilton’s adherents: “I never observed so drooping an aspect, so turbid and forlorn an appearance as overspread the partisans of the Secretary in our House this afternoon…. [Rufus] King looked like a boy that had been whipped.”
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Maclay’s exuberance was justified. On April 12, 1790, the House voted down Hamilton’s assumption plan, thirty-one to twenty-nine, and two weeks later voted to discontinue all debate on the issue. By early June, it looked as if the assumption plan was heading for oblivion. So Hamilton began to search for a compromise that would salvage the linchpin of his economic program.

The issue that he seized on was the divisive question of where the national capital should be located. At the Constitutional Convention, the delegates had decided to create a federal district, ten miles square, in an unspecified location. This decision generated melodramatic speculation. Some people found the idea of a separate capital fraught with danger, fearing a privileged enclave. Governor George Clinton envisioned the ten-mile square as the scene of a presidential “court” disfigured by royal trappings and marked by “ambition with idleness, baseness with pride, the thirst of riches without labor…flattery…treason…perfidy, but above all the perpetual ridicule of virtue.”
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The capital’s location had already led to intensive lobbying and intrigue. It was a monumental decision for contestants, since it would confer massive wealth, power, and population upon the winning state. More important, it would affect the style of the federal government, which was bound to soak up some of the political atmosphere of the surrounding region. In a large country with poor transportation, the voices of local citizens would resonate loudly in the ears of federal legislators.