"Hamilton" Tells Half the Story

A. Ham.'s policies set the stage for corruption and abuse of power

Lin-Manuel Miranda’s Broadway musical “Hamilton” is full of catchy songs, dramatic moments, and witty humor. Over its eight-year run, it has done a tremendous job of encouraging young people to take an interest in American history.

It has not, however, been honest about that history.

Hamilton’s triumph, as presented in the show, was the successful implementation of the Federalist political agenda: a strong central government with broad financial and administrative authority. The show’s antagonists are Thomas Jefferson and the anti-Federalists who were concerned that Hamilton’s policies would turn America into the kind of tyranny they had just fought a bloody war to escape.

As “Hamilton” depicts through songs and rap battles, Hamilton and his colleagues use savvy political maneuvering, emotional appeals, and a series of persuasive essays known as the Federalist Papers to marshall the political muscle necessary to push their ideas through the Constitutional Convention.

The song, “Cabinet Battle #1” describes one aspect of the debate. Many states were still carrying heavy debts because of the military expenses of the Revolution. Hamilton proposed that the federal government should assume the states’ debts, arguing that allowing them to default would be catastrophic for the economy, and harmful to the international credibility of the fledgling country. Jefferson countered that this would effectively transfer wealth from taxpayers to the wealthy speculators who had loaned money to the states. Speculators that were, not coincidentally, friends and associates of Hamilton.

In fairness, history has proven Hamilton correct about nationalizing the debt. The ongoing economic debacle in the European Union shows what happens when a confederation shares a common currency but not a common debt. Poorer countries receive a lower credit rating, and are forced to make payments at higher interest rates. Richer countries receive favorable credit terms, allowing them to invest and grow even richer. The national debts of the poorer countries increase quickly as interest charges accumulate, so making payments consumes an ever-larger share of their economies. This means that money is taken from productive taxpayers and transferred directly to bondholders, which are usually foreign investors, hedge funds, and central banks.

Had it not been for Hamilton’s plan, the death-spiral fate of the EU probably would have happened to the United States. That’s why Hamilton is regarded as a hero, and has a Broadway show named after him.

But the story doesn’t end there.

During the ratification of the Constitution, Anti-Federalists were able to obtain some compromises (most notably, the addition of a Bill of Rights), but on the whole were unsuccessful in their efforts to stymy a Federalist power grab.

It took only a few years for their fears to be realized.

In 1791, one year after nationalizing the states’ debts, Congress passed a federal excise tax on distilled spirits. The tax, which was supported and implemented by Treasury Secretary Hamilton, was intended to raise money to pay off the new, national debt.

Unfortunately, it disproportionately affected impoverished farmers and distillers in western Pennsylvania, where whiskey production was a vital part of the local economy. The resulting protests and resistance became known as the Whiskey Rebellion.

The Federal government’s response to the Whiskey Rebellion was what a later generation might refer to “shock and awe.” President Washington, at Hamilton’s urging, raised a federal militia of 13,000 troops - roughly equivalent to the largest mobilization of the Continental army during the Revolutionary War - and marched them to Pennsylvania under the leadership of General Henry "Light Horse Harry" Lee.

Faced with an overwhelming show of force, the farmers and distillers in the Whiskey Rebellion surrendered and dispersed. The message came through loud and clear: oppose Federal policies, and you will be crushed like a bug.

Every expansion of Federal power that has occurred since 1791, up to and including oppressive taxation, the growth of the military-industrial complex, violations of due process, and the creation of abusive administrative agencies that wield legislative and judicial authority in violation of the principle of separation of powers, can be directly traced to the Federalist agenda championed by Alexander Hamilton. His fiscal policy may have saved the American economy, but his faith in centralized government and his contempt for individual freedom have doomed us to follow the same path of tyranny he fought a bloody war to escape.