Hamilton v. Jefferson: The Central Bank Debate [POLICYbrief]

In 1791, two great minds clashed over an issue of constitutional and historical significance. Alexander Hamilton and Thomas Jefferson tried to make the case to President George Washington for and against having a national, central bank. Hamilton saw the central bank as the key to America’s economic future, whereas Jefferson worried about the consolidation of power and thought a central bank was unconstitutional. In this episode of POLICYbrief, two experts--David Cowen, President/CEO of the Museum of American Finance, and Thomas J. DiLorenzo, Professor of Economics at Loyola University--explain and analyze this 200-year-old debate that still has relevance today.

As always, the Federalist Society takes no position on particular legal or public policy issues; all expressions of opinion are those of the speaker.

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Learn more about David Cowen

Alexander Hamilton on Finance, Credit, and Debt

Learn more about Thomas J. DiLorenzo:

Hamilton's Curse

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Related Links:

[Founders Online] To George Washington from Thomas Jefferson, 15 February 1791

[PBS] Establishing a National Bank

[Federal Reserve History] The First Bank of the United States

[Constitution Center] Hamilton’s Treasury Department and a great Constitutional debate

[History] Whose Vision of America Won Out—Hamilton’s or Jefferson’s?

[Mises] The Corrupt Origins of Central Banking

[Federal Reserve] America's Central Bank: The History and Structure of the Federal Reserve

[Oyez] McCulloch v. Maryland

[Cato] Money and Banking: A Constitutional Perspective

[AzaJabar]

It is also important to note that this debate was settled by a rap battle

[superherobandaa]

“No government should be without critics. If its intentions are good then it has nothing to fear from criticism.”

— Thomas Jefferson

One of my favorite quote...

[liamconverse]

"And I sincerely believe with you, that banking establishments are more dangerous than standing armies; & that the principle of spending money to be paid by posterity, under the name of funding, is but swindling futurity on a large scale"

-Thomas Jefferson, in a letter 1816

[MYMARSHMELLOWLIFE]

The economic miracle…./monster that America has turned into. Jefferson would smugly look at Hamilton and simply state “told ya”

[abrahamlincoln]

Hamilton's central bank didn't even come to reality. Federal reserve is a big club for the private banking industry

[rustusandroid]

200+ years later, 22 Trillion in debt and 180 Trillion in unfunded liabilities, we see that Jefferson was correct.

[phillipgalloway]

I think Hamilton's position would have been different if he could have seen where it took us 230 years later.

[Jose-lcnj]

Jefferson warned us
We didn't listen
We ask for a free lunch
Now we will pay the price of this madness

[user]

OK so now I got to start researching if Hamilton was lobbied by the bankers....

[helpme]

End The Fed

Edit: After 2 years now I think that Hamilton was right

[adambowman]

No country needs a central bank of any kind. All you need is a good backed currency

[freedomtosayno]

“Government is the only institution that can take a valuable commodity like paper, and make it worthless by applying ink.” — Ludwig von Mises

[thequickonesxd]

Jefferson later used the same loose interpretation of the constitution for the Louisiana Purchase. Clearly shows that, even for Jefferson, abiding to the strict definition was not always beneficial for the nation.

[JoeR]

This has to be the worst interpretation of that feud anyone has ever tried to portray. Hamilton essentially wanted the fed before the fed. He wanted the ability to make up money out of thin air and make the American people pay for it. "Change my mind"

[SarV]

Economic miracle?
Look at our national debt, its quite the opposite of miracle.
In fact, its an economical tragedy.

A child born today, in the USA, starts life off with close to $60k in debt.
Yeah, miracle is the word Id choose 👌

[Ricvictors]

The incredible life of Alexander Hamilton: the secretary of treasury that was born an illegitimate son, immigrated to America, fought for the revolution and became a rapper.

[claytoncole]

Jefferson would say... "I told you so" how's the family unit doing these days. How is the right to persue happiness holding up during lockdown?

[peter]

Economic miracle? Fiat printing from covid to zambawe

[SnekChrmr]

Hamilton definitely had the more modern way of thinking, he knew what the nation needed

[trevorlambert]

Central Bank is one thing, which there is a strong case for. Creation of the Fed in the 1900s is another where we can now print money based on debt rather than real assets (such as the Gold Standard). THAT, is the problem of today. Jefferson was right about special interest groups and consolidation of power to the central government; it has happened in this country.