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In Hamilton's Curse, author Dr. Thomas J. DiLorenzo traces the roots of America's economic and political systems to the first secretary of the Treasury Alexander Hamilton. We are truly living in "Hamilton's Republic," says Dr. DiLorenzo -- but this is far from a good thing.
While it is Thomas Jefferson's face that graces Mount Rushmore, and tremendous lip service is paid to his greatness as a political thinker and president, in reality, Jefferson's ideas have been entirely marginalized, while those of his arch rival Hamilton now form the backbone of the American political establishment. The Revolution of 1776 was a Jeffersonian Revolution to throw off the yoke of British mercantilist imperialism and install it its place a voluntary union of free and independent states. Hamilton and his acolytes, however -- no matter how bravely and earnestly they fought against the Red Coats -- wanted to import British mercantilism to America with the U.S. aristocracy (Hamilton and his Federalist buddies) on the receiving end of the mercantilist spoils system. In fact, DiLorenzo argues that the Constitution itself was a virtual coup against the free republic of the Articles of Confederation for the purpose of increasing the authority of the central government -- key to Hamilton's plans.
But Hamilton couldn't create the unitary nationalist government in one fell swoop. Indeed, his plans to install a permanent president -- an American king -- with the power to appoint state governors and veto state legislation failed miserably. But as soon as the Constitution was ratified, Hamilton (who argued the pseudo-Jeffersonian case for its ratification in the Federalist Papers) set about subverting it. It was Hamilton who invented the concept of "implied powers.Read more ›
is to show the effects of ideas upon society. DiLorenzo's book compares the ideas of Alexander Hamilton with those of Thomas Jefferson, and shows how the effects of Hamilton's ideas have triumphed through to the present. DiLorenzo convincingly describes how the US is a Hamiltonian state, meaning it's highly centralized, with a politicized monetary system, an aggressive and powerful tax collection system, and a judicial monarchy of unelected, life-appointed lawyers that historically have not acted as a check on legislative and executive powers. The author points out from 1937 to 1995 the Supreme Court has not ruled any federal legislation to be unconstitutional. DiLorenzo states that "...any reasonabley clever lawyer can dream up myriad hypothetical situations to justify virtually any kind of government action." Pg. 179.
DiLorenzo is extremely conservative in his political and economic views, if conservative means limited government. He states "Hamilton was the godfather of economic interventionism and big government." The author explains why both the left and the right sides of the political spectrum are enamored with Hamilton's views, and why it is ironic that Hamilton's influence is most appreciated by conservatives. Hamilton believed in the partnership of businesses and government. The author makes a case that economic instability is a consequence of Hamilton's policies of centralization and taxation, and believes the central banking Federal Reserve is detrimental to stability, especially with the lack of backing of `specie' (gold or other hard assets). This point is also asserted by Murray Rothbard in "What Has the Government Done With Our Money?" DiLorenzo wryly observes it's fitting that Hamilton's statue is in the front of the US Treasury Department.Read more ›
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DiLorenzo has made a difficult subject readable. It is an American political economic history covering a period from the Ratification Debates to the present. It is told from the contrasting viewpoints of Jefferson and Hamilton, as to the political system which the secession from England was meant to create.
For me, it covered new ground and reinterpreted well some ground I thought I had understood. It is both chronological and topical history. The author's use of original and secondary sources added to its value. All of which made it a fruitful present exercise and a tool for future reference.
As has been noted by other reviewers, it has special present circumstance value. National Bank/Federal Reserve Bank is the pivot point of today's rational pessimism. And it is the legacy of Alexander Hamilton. Greed comes with human seed; Hamilton's ideology centralized it.
I suppose, in the dark history of "democracy" and its variants, one could have drawn the baseline with Solon or Pericles. However, in the uniquely American variant of a "democratic" social contract, it is Hamilton's legacy that needs scrutiny. And DiLorenzo delivered such fully.
Whether it is the Supreme Court, The Fed, regulatory practices, the income tax, direct election of Senators, protectionism, or standing armies, Hamilton is the genesis. Our "Great Experiment" had a frightful beginning, a precarious middle and, obviously, might have an oligarchic end. We had a chance to design a system based on Jefferson's theories, but we have chosen otherwise. Perhaps we're cursed by Hamilton.
Robert Higgs, one of the many fine writers referenced in this book, asked himself in print recently: have we been led by fools or mountebanks? He answered: yes! And in reading this great book, I thought often that Hamilton might be both.
Thomas J. DiLorenzo is the author of The Real Lincoln and How Capitalism Saved America. A professor of economics at Loyola College in Maryland and a senior fellow at the Ludwig von Mises Institute, he has written for the Wall Street Journal, USA Today, the Washington Post, Reader's Digest, Barron's, and many other publications. He lives in Baltimore, Maryland.