A Critique of Tom DiLorenzo's Hamilton's Curse

*Written by Tho Bishop.

Hamilton’s Tragedy:

Last week’s blog on Thomas DiLorenzo’s Hamilton’s Curse reminded me of the objections I had with his book. None of these objections deal with DiLorenzo’s critique of Hamiltonian economic policy; in fact DiLorezno’s book was my first exposure to the Ludwig von Mises Institute and DiLorenzo’s brilliant explanation of the consequences of Hamiltonianism was so effective that it completely changed my perspective of American history and stressed to me the importance of sound economic understanding. This is typically one of the first books I recommend to people interested in learning more about the credibility of revisionist history.

My complaint with DiLorenzo’s work deals mainly in his portrayal of Alexander Hamilton – the man. Those otherwise unfamiliar with General Hamilton would leave DiLorenzo’s work with the impression that Hamilton was a manipulative schemer who laughed maniacally in his dungeon as he carefully orchestrated the eventual enslavement of America. In fact DiLorenzo couldn’t even bring himself to give Hamilton credit for his abolitionist views. As biographer Ron Chernow points out, Hamilton was a proud and active member of the abolitionist New York Manumission Society and that as a legal adviser, “helped defend free blacks when slave masters from out of state brandished bills of sale and tried to snatch them off the New York streets.” Though his work as an abolitionist does not absolve the faults of Hamiltonianism, I fail to see the benefit of unfair criticisms. It seems to me that DiLorenzo’s goal in Hamilton’s Curse went beyond pointing out the fallacies of Hamilton’s policy objectives and instead sought to trarnish his legacy in general. I contend that DiLorenzo overreaches.

Hamilton the Man:

What attracted me to DiLorenzo’s book was actually the brilliance of Hamilton’s life. I admired Hamilton and wanted a different viewpoint. The story of Alexander Hamilton is a uniquely American one: the bastard son of a disgraced Scot of noble blood, Hamilton came to this country due to the charity of the inhabitants of his Caribbean island who recognized young Alex’s natural talent. Entering New York’s King’s College on the back of the charity of others, Hamilton would grasp the opportunity and never look back. As a collegiate, Hamilton wrote letters in defense of American independence that were so eloquently written that many prominent New Yorkers thought they stemmed from the pen of John Jay. When shots were fired in Lexington and Concord, Hamilton took arms in the defense of colonial liberty. In short time young Hamilton caught the eye of General George Washington, and at age 22 he would become the campe-de-aide for Washington and entrusted him with the most sensitive of missions. Hamilton would finally be allowed to lead his own battalion during the decisive Battle of Yorktown where he characteristically rose to the opportunity.

After the Revolutionary War, Hamilton became an extremely successful New York attorney after choosing self-instruction rather than the more typical route of apprenticeship. Demonstrating his belief in the necessity of protecting the rights of all Americans, the veteran Hamilton made a mark defending the rights and property of loyalist-New Yorkers. Washington’s colonel became a devoted nationalist during his military service and was recognized for his devotion to his adopted country. It was inevitable that Hamilton would work his way into early-American politics and worked closely with James Madison to call for the Constitutional Convention.

In Philadelphia, Hamilton unveiled his vision for American government: a President serving for life on good behavior, Senators serving for life on good behavior, and an Assembly elected every three years. In Hamilton’s vision, the President would have absolute veto, the Supreme Court would have immediate jurisdiction of all lawsuits and the Federal government would appoint the State governors. As Hamilton expected his proposal went nowhere, but Hamilton would fight for the ratification for the product created at the Convention, most notably as chief writer of the Federalist Papers. In spite of his preference for centralized power, Hamilton will be forever known as the founder of the ironically named Federalist Party.

It was as Treasury Secretary that Hamilton would leave his most disastrous mark in American history. Inspired by Jean-Baptiste Colbert, Chief Finance Minister of the “Sun King” Louis XIV, Hamilton encouraged an economic policy consisting of a central bank, government subsidization of industry and protectionist tariffs. Though Hamilton himself can be praised for his being above corruption while at the Treasury, his actions directly led to privileged men “in the know” to enrich themselves from his policy. In describing Hamiltonian economic policy, I will defer to DiLorenzo who writes:

Hamilton was an American mercantilist, and he and his party (and its political heirs, the Whigs and Republicans) advocated special-interest policies that would primarily benefit politically connected merchants, manufactures, speculators, and bankers at the expense of the rest of the public.

Though Hamilton himself did not serve (nor get along with) Federalist President John Adams, Hamilton was a favorite amongst Adams cabinet – much to Adams disgust. Hamilton’s Federalist Party would lose the White House to Thomas Jefferson in the election of 1800 and the philosophy of the Federal government followed; Hamiltonian nationalism replaced by Jeffersonian liberalism. The American public reacted well to the change: Virginian Jeffersonians controlled the White House for the next 24 years, 1816-1824 became known as the “Era of Good Feelings” and Jefferson’s Republican Party became the sole political party in the country until the controversial election of 1824 (an election where the Jefferson-backed William Crawford received more electoral votes than future-Whig leader Henry Clay and likely would have won the Presidency if not for a debilitating stroke.)

The defeated Hamilton would spend his final years focusing on religion and attacking the Jefferson Administration, mainly through the creation of the newspaper known today as the New York Post. Hamilton was famously killed in a duel with the Vice President of the United States at the same site his firstborn son, Philip, dueled to the death three years earlier.

DiLorenzo’s Hamilton:

Hamilton’s impressive narrative inspired me. If Hamilton could begin to change his world by the time he turned 22, so would I. After reading DiLorenzo’s book, however, I was forced to take another look at my new hero. As I took to studying economics, DiLorenzo’s critique of Hamiltonian policy held up – his characterization of Hamilton doesn’t.

DiLorenzo’s Hamilton is a devoted enemy of liberty who fancied himself something of an American Napoleon. DiLorenzo often relies upon the opinion of Thomas Jefferson and his allies in painting Hamilton’s character. For example, in pointing to Hamilton’s lengthy defense of a national bank, DiLorenzo writes: “He authored another long-winded report on the supposed constitutionality of the bank, a report that Jefferson believed was, like the others, intentionally confusing.” Obviously using the opinion of Hamilton’s greatest rival to decipher Hamilton’s intention is questionable scholarship. DiLorenzo again points to a Jeffersonian perception of Hamilton as he point outs, “historian John C. Miller noted that Jefferson’s party had ‘suspicions that the army had been strengthened in 1798 not to fight Frenchmen but to suppress opposition to Federalist policies.”

Four times in his book DiLorenzo quotes Hamilton’s description of the Constitution as a “frail and worthless document”, the implication that the author of the Federalist Papers had little use for the document and that he merely played the role of advocate so he could boost his own political power. Did DiLorenzo catch a slip-up from the duplicitous Hamilton? Let’s look at the quote, found in a letter to Gouverneur Morris, in context:

Mine is an odd destiny. Perhaps no man in the U States has sacrificed or done more for the present Constitution than myself. And contrary to all my anticipations of its fate, as you know from the very beginning, I am still labouring to prop the frail and worthless fabric. Yet I have the murmur of its friends no less than the curses of its foes for my rewards. What can I do better than withdraw from the scene? Every day proves to me more and more that this American world was not made for me.

This letter was written during the darkest days of Hamilton’s life following the death of his son and after Jefferson’s success had relegated Hamilton into a political outcast. Does this sound like an enemy of the Constitution? Or does it sound like a defeated man tired of constantly being painted as its enemy? The recipient of his letter would later state at Hamilton’s funeral that, “His speculative opinions were treated as deliberate designs and yet you all know how strenuous, how unremitting, were his efforts to establish and preserve the Constitution.

Hamilton’s Curse:

Though Hamilton was a product of the island of Nevis, he was perhaps the loudest voice advocating America to resemble European powers. Though I disagree with DiLorenzo’s view of Hamilton, I cannot deny the reality that Alexander Hamilton was a nationalist mercantilist. How did Revolutionary America create such a leader? I point to Hamilton’s upbringing and intellectual development. Where DiLorenzo sees a manipulative power hungry politician, I see a well-meaning patriot who dedicated himself to creating the best country possible for his fellow Americas. Where DiLorenzo sees intentional malice, I see the tragedy of a guy who simply got it wrong.

Lets start with Hamilton’s upbringing.  As Ron Chernoff notes: “Island life contained enough bloodcurdling scenes to darken Hamilton’s vision for life, instilling an ineradicable pessimism about human nature that infused all his writing.” Even as a boy, Hamilton’s writings are tainted with this darkness. Noted young Hamilton, “And let me tell you, in this selfish, rapacious world, a little discretion is, at worst, only a venial sin.”  His worldview led Hamilton to always be attracted to the philosophy of David Hume.

Where most Founding Fathers held a very romantic view of the American Revolution, Hamilton recognized the horrors of the mobs that helped sparked it, often resorting to barbarous measuring such as tarring and feathering and riding the rail. Hamilton’s loyalist college president, Dr. Myles Cooper, was a target of one of these mobs when collegiate Hamilton bravely stood before them and spoke. He admonished the mob, telling them their actions “disgrace and injure the glorious cause of liberty.

Occurrences such as this made Hamilton fear the chaos of anarchy and he viewed that government needed to be strong enough to calm the passions of men. In the Federalist Papers Hamilton would later write: “In a nation of philosophers a reverence for the laws would be sufficiently inculcated by the voice of an enlightened reason. But a nation of philosopher is as little to be expected as the philosophical race of kings wish for by Plato. And in every other nation, the most rational government will not find it a superfluous advantage to have the prejudices of the community on its side.”

This view of mankind explains the fundamental difference in philosophy between Hamilton and Jefferson. Jefferson viewed government as an institution that threatened the rights of man; Hamilton viewed it as a means to ensure a peaceful and prosperous society – as long as it accurately represents the interest of its subjects.

But did this necessarily force Hamilton to be a nationalist? The elder Hamilton certainly was, which explains his rejection of the Kentucky and Virginia Resolutions. I think it is interesting, however, to look at Hamilton’s collegiate writings. In his first great success, The Farmer Refuted, Hamilton sounded rather Jeffersonian when he wrote, “The nations of Turkey, Russia, France, Spain, and all other despotic kingdoms in the world, have an inherent right, whenever they please, to shake off the yoke of servitude (though sanctioned by the immemorial usage of their ancestors), and to model their government upon the principles of civil liberty.” Throughout the article Hamilton frequently speaks of the sanctity of human rights. “I am inviolably attached to the essential rights of mankind and the true interests of society. I consider civil liberty, in a genuine, unadulterated sense, as the greatest of terrestrial blessings. I am convinced that the whole human race is entitled to it, and that it can be wrested from no part of them without the blackest and most aggravated guilt.”

What do I attribute to this reversal of philosophy? Hamilton’s military service.  A liberal government is best suited for peace, not war and the difficulties General Washington had in securing appropriate funds from the Continental government is well documented. Hamilton had a first hand view of these difficulties. The nature of military service to lead great American minds to nationalism over liberalism is further validated by an American President DiLorenzo speaks favorable of: Andrew Jackson. Though Jackson, as Murray Rothbard noted, held sound economic philosophy, he combined it with a nationalist governmental philosophy. When South Carolina threatened to secede over the issue of tariffs, Jackson threatened to invade the state.

DiLorenzo implies that Hamilton’s monarchist visions are incompatible with Jefferson’s liberalism. When I first encountered Hamilton’s vision for government, I too found myself a bit turned off. It was an article from Mises Daily that forced me to reconsider its merits. Hamilton understood the danger of democracy, fearing that such a system would produce demagogues who, as Chernoff writes, “fed off poplar confusion while proclaiming popular rights.”

Of course it is Hamilton’s economic policy that draws the majority of DiLorenzo’s scorn and for very good reason. In order to understand how a man of Hamilton’s talent could produce such a terrible economic program, we must recognize that he did not benefit from the experiences, nor the writings, of Ludwig von Mises or the rest of the Austrian School. In fact the economic science as a whole was still new with Richard Cantillon’s Essai sur la Nature du Commerce en Général written just 25 years before Hamilton’s birth and the Wealth of Nations 20 years after. Furthermore the British Empire, who had the most powerful economy in the world and whose success Hamilton aspired to replicate, was founded on mercantilism that contradicted Smith’s vision. Hamilton educated himself with voracious reading; unfortunately, as Murray Rothbard points out, “The mercantilists, dominant in economic thought for the preceding century or two, were special pleaders whose tidbits of analysis were pressed into the service of political ends, either in subsidizing particular interests or in building up the power of the state.” Hamilton gobbled down these works, fueling his mercantilist visions.

Conclusion:

It is easy to demonize those we disagree with – especially for classical liberals, like myself, whose philosophical foundation forces us to view the advocates of large and energetic government as enemies to our natural rights. Though Hamilton’s economic philosophy cannot be defended, and though I recognize the consequences of it and his intellectual heirs as the source of great injustice in today’s world, we must constrain ourselves to attacking ideas – not the character of those behind them. Not only do I reject DiLorenzo’s portrayal of Hamilton, but I also believe it undermines the greatest lesson we can learn from it. Alexander Hamilton represents the ideal government bureaucrat: a brilliant man beyond corruption who dedicated his life to serving his country. And even he was wrong. If Alexander Hamilton couldn’t successfully micromanage our economy, how can we place such faith in any leader?