How Bitter Political Disputes Made America Great

How Bitter Political Disputes Made America Great

In Jay Cost's latest book, 'The Price of Greatness,' the scholar and journalist lays out a compelling analysis of the feud between Alexander Hamilton and James Madison showing that their disagreements resulted in a synthesis of differing opinions that allowed our early republic to thrive.
Kyle Sammin
By

Historical reputations are fickle things. Most national figures vanish into the misty past not long after their deaths. For those who are truly influential, the way they come to be remembered can flit back and forth according to the whims of historians, politicians, and the people at large. That fluctuation often tells us as much about us as it does about them.

Alexander Hamilton is a case in point. It was not long ago that he was derided as an elitist and quasi-monarchist, despite his own humble beginnings and meritocratic rise to prominence. His one-time friend James Madison, on the other hand, was seen as a tribune of the people, a leveler and wise statesman, notwithstanding his great wealth and ownership of scores of black slaves.

Trends in historical scholarship have begun to cast aspersions on slave-owning Founding Fathers, pushing Madison, Thomas Jefferson, and other great Virginians further down the scale of opinion in the academy, if not elsewhere. Meanwhile, a popular musical poured fresh enthusiasm into the old Federalist wineskin and made Hamilton great again, just as his fellow northern Federalist John Adams gained in popular renown following David McCullough’s biography of him and the subsequent HBO miniseries based on it.

The fashions of scholarship can make us lose sight of the men behind the myths. In The Price of Greatness: Alexander Hamilton, James Madison, and the Creation of American Oligarchy, Jay Cost returns to the beginning and analyzes the political theories that brought Hamilton and Madison together and, later, drove them apart. Concentrating on ideas rather than personalities, he lays out the conflict at the heart of the early republic’s politics and the compromises that led to its resolution. Along the way, the reader may gain a true appreciation for the ideological conflict of the United States’ first decades and may come to understand how that conflict, in various forms, is still debated today.

From Friends to Enemies

Hamilton and Madison began, famously, as friends. They collaborated, along with John Jay, on the Federalist Papers. Now revered as the best contemporary explanation of the meaning of Constitution they had helped create, the essays aimed to convince New Yorkers to ratify the Constitution—which they did. At the time, Hamilton’s and Madison’s goals were sufficiently aligned that they were able to publish their political tracts under a common pseudonym: Publius.

That is not altogether surprising. Both men worked for independence from Britain and saw the need for a stronger form of central government to replace the one created under the Articles of Confederation before the country drifted apart its constituent parts. And both men’s ideas on government began with a common source in Enlightenment thought. Specifically, as Cost writes, “they were both strongly influenced by David Hume’s writings on human nature—particularly the relationship between reason and passion in governing individual behavior.”

As often happens after such a realigning political victory, the victors disagreed among themselves on where to go from there, and Hamilton and Madison ended up on opposing sides of the new political divide. The result was two parties, the Federalists and the Democratic-Republicans (usually just called “Republican” at the time, they have been labeled “Democratic-Republican” retroactively to distinguish them from the modern Republican Party). Hamilton was among the leaders of the former, Madison of the latter.

Often seen as a conflict over strict versus loose constitutionalism, or pro- and anti-banking factions, these were mere symptoms of the divide. The underlying philosophical dispute was over how to corral the violent passions aroused by factional politics—something that follows from Hume’s philosophy. Both men believed a stronger central government with a mixed political system was the key to finding a solution. Now that they had one, what to do with it became contentious.

Monarchy or Oligarchy?

For Hamilton, the British government offered the best example of a solution. Specifically, the use of patronage from the executive would help to align powerful interests across the nation with the new central government. Here, Hamilton aligned with Hume in advocating a system of executive patronage to balance the power of the legislature, which under the Constitution was the most powerful branch of government.

Hamilton expressed his theory of government in his proposals as secretary of the Treasury, calling for legislation that would let him use the machinery of government to encourage industry and the concentration of wealth that would propel the United States into the first rank of nations. “Hamilton wished to turn the moneyed class into mediators of the public good,” Cost writes, “reorienting their financial interests to the interests of the new government.”

In consolidating and repaying the public debt in full, Hamilton took the first step toward that realignment. The various debts incurred by states and the federal government during the revolution were denominated in bonds, and those bonds had often traded far below their face value, especially in times markets suspected they would never be repaid in full, if at all. The result was that many soldiers who had been paid in bonds sold them cheap to speculators, needing hard cash right then more than the promise of cash in some possible future.

Hamilton saw repayment as simple justice, the government following through on its word; Madison saw it as favoritism to the rich, making these speculators even wealthier because of a gamble they could afford to take and the common people could not. Madison proposed various ideas for diverting some of the payment to the original bondholders, but Hamilton’s plan won out, not least because Madison’s idea would have been fiendishly complicated to execute.

Bondholders got paid and therefore had a stake in the continued success of the federal government. By assuming state debts, Hamilton further redirected bondholders’ loyalty to the federal government. Although Cost does not mention it, the idea was similar to one enacted in Britain a century earlier. After coming to power in a revolution in 1688, William III and his supporters in Parliament oversaw the creation of a Bank of England to finance the government debt, which was escalating because of the foreign wars William undertook.

Besides making payment of debts less dependent on royal whims, the Bank also tied the rich into the continued success of William’s regime. Were the old king put back on the throne, William’s acts would be invalid and the Bank’s promises voided. Hamilton was surely aware of the example, and it aligns his Anglophilic sentiments on government.

Madisonians Pounce!

Madison and Jefferson saw this concentration of wealth and power as thinly veiled monarchism and, worse yet, an open invitation to corruption that would result in the nation being controlled by an oligarchy of the rich. Federal assumption deepened that problem by creating a singular financial elite to replace the powerful groups that held sway in the various state capitals.

In this they were mostly correct, and the men who gained power through Hamilton’s policies did not always use it in the disinterested manner he naively expected they would. The public debt issue was the first over which Madison and Hamilton broke publicly, but it would not be the last.

As we see in our own time, to honest disagreements were added the kind of disputes that plague partisan systems: Once one side adopted a position, the other side would choose the opposite. From there, disagreements only grew greater as partisans drove each other to extremes.

Madison began the debt controversy, believing that the idea favored a financial elite at the expense of the common man and would lead to corruption and favoritism. When Hamilton next proposed the creation of a Bank of the United States, Madison opposed that, too, in stronger terms than he had ever offered on the subject before. On trade, they also differed, sparring over Hamilton’s call for direct subsidies to industry or, failing that, a protective tariff.

On foreign policy, the two parties also established differing views, with the Federalists seeing America’s interests as being best served by close commercial ties with Britain, our cultural mother country, and the Democratic-Republicans favoring closer ties with the newly established French Republic, with which we shared a form of government. That dispute gave rise to the only occasion when the two former co-authors of The Federalist Papers opposed each other in print.

Writing under the pen name “Pacificus,” Hamilton defended President Washington’s proclamation of neutrality and, in true High Federalist fashion, declared it the sole power of the executive to interpret treaties and even to abrogate parts of them. Hamilton also added what Cost describes (accurately) as “cheap shots at the Republicans.” Jefferson encouraged Madison to respond, which he did under the name “Helvidius.” In equally vitriolic terms, Madison defended his side while accusing Hamilton of wishing the president to rule as a monarch.

Madison Triumphant

Hamilton’s economic plans won out in the short term, but as the Federalist Party receded Madisonian policies began to take their place. In 1800, Jefferson defeated Adams for the presidency and the Federalists never again held the White House or either house of Congress. The government shrank, and when the bank’s charter came up for renewal in 1811, then-President Madison never had to decide whether to veto it, as the bill went down to defeat in the Senate. Hamilton himself had been dead for years, killed in a duel with Aaron Burr in 1804.

Abroad, America steered a middle course between Britain and France (which was now an empire, not a republic). Madisonian diplomacy, as Cost describes it, was premised on the idea that “the United States was stronger than Great Britain and could bring it to heel through commercial retaliation.”

This, as Hamilton had realized decades before, was nonsense. The nation soon learned the truth of the matter when, fed up with commercial bullying, interference with our Western frontier, and impressment of our sailors on the high seas, America was forced to launch an actual retaliation and declared war in 1812.

In their triumph, Madisonians were forced to accept that some of the Federalists’ ideas weren’t all wrong. Reduced military spending over the years had weakened the nation’s armed forces. The atrophied financial system, too, harmed America as the lack of hard currency meant improving the situation was that much more difficult. In the end, Madison endorsed a Second Bank of the United States and called for protective tariffs to encourage manufacturing.

Synthesis

Had the Hamiltonians won in the end? Not exactly. It is better to say that after a generation of partisan warfare, the survivors picked up the pieces of the parties’ shattered platforms and forged a synthesis, taking the best of both. The resulting “Era of Good Feelings” was short-lived, but the disputes that followed were over, for the most part, different issues. “When Madison left office in 1817,” Cost writes, “there seemed to be a sensible middle ground between the extremes of Republican simplicity and Federalist elitism.”

It’s a good lesson for people driven to distraction in our own times. As angry as partisans get in the twenty-first century over immigration, health care, and trade, they were every bit as angry in the nineteenth century over the national bank, our relationship with Britain, and, yes, trade. Some things never change, but others seem like distant memories, and even students of the period cannot conjure the fury about them that the people they studied did.

That is heartening, in a way. We want to believe that our cause is a cause for all time, but most of the things we argue about will be forgotten by our grandchildren. One side will win, but probably not as completely as they want. There are exceptions—the fight against slavery was decisive—but most policy arguments end in compromise and are forgotten.

That is not to say that the fight itself is unimportant. The fight is politics, and politics is how a free people governs itself. While we would all love to skip to the end and adopt the right position—which always happens to be the one that we personally espouse—that’s not the way it works. As they did in Hamilton and Madison’s time, we will pound our heads together for a while and, in time, the proper course will emerge. It can be ugly, but our politics is also the price of our greatness.

Cost rehabilitates Madison a bit, and explains his choices and how he changed to meet the times. Hamilton’s reputation is similarly deflated slightly, taking account of his misjudgments. This book reminds us neither of the two was all one thing or all the other. It also reinforces the truth that division and dissent and passion are nothing new to the American scene, or indeed to the human race, but also that compromise and eventual agreement have also always been with us.

Kyle Sammin is a lawyer and writer from Pennsylvania. Read some of his other writing at kylesammin.com, or follow him on Twitter @KyleSammin.

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