Election 2016: What would Alexander Hamilton do?

Alexander Hamilton is in vogue, with a bestselling biography and an ongoing Broadway hit musical.

As an economist, I cannot help but think about how Hamilton would react to the political campaign of 2016. After all, Hamilton was a New Yorker, a lawyer like Hillary Clinton and a business investor like Donald Trump. Like Trump, he never held elective public office.

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He played a key role in George Washington’s general staff in the Revolutionary War, eventually taking command of an artillery force at the Battle of Yorktown. After the United States Constitution was ratified, Hamilton entered Washington’s cabinet not as secretary of war, but as the first secretary of the treasury. A rara avis indeed: a lawyer who knew both economics and military strategy.

Hamilton showed his astute understanding of the fragility of the new American experiment both in private life and in public office. After the war, the New York state legislature passed discriminatory laws against Tories who remained in the United States, and there was widespread support to cut off trade with Great Britain. And of course, there was the ongoing question of slavery. Hamilton called it right on all of these hot-button issues. He defended the rights of the Tories; he understood that the new country, if it was going to grow and prosper, could not go it alone, but would have to trade with a world power like Great Britain; and he opposed slavery. He was not afraid to take unpopular positions, and thus make enemies. Moreover, he understood the importance of judicial review of both state and federal legislation, to preserve the ideals of the American Constitution. He was not one to equivocate.

Hamilton’s youth is in many ways a lot like that of former President Bill Clinton. Both came from poor “broken” families. Both seized opportunities to leave their birthplaces and study at major universities. Both leveraged their contacts from those universities to further their ambitions. Both experienced public scandals involving marital infidelity. Unlike Bill Clinton, of course, Hamilton served his country in time of war. And he was an immigrant.

It is always hard to imagine what historical figures would do in the present. The political and economic world is very different. But Hamilton was a forward-looking, savvy thinker. He knew well the perils of public debt getting out of control, the need for a national central bank with powers to regulate the growth of the money supply and the need to find tax revenue in orderly ways that would not disrupt commerce and investment.

Who would Hamilton support in 2016? Reading about his interactions with two political foes, Aaron Burr and Thomas Jefferson, my feeling is that he would reluctantly support Hillary Clinton. Hamilton disagreed with Jefferson on almost every issue, including support for France in the Anglo-French war after American independence, but he supported him in the presidential election of 1800, because he disliked even more the “cultivated ambiguity” of Burr, who turned out to be Jefferson’s chief opponent. Clearly we see much “cultivated ambiguity” in the Clinton campaign, such as her about-face on the Trans-Pacific Partnership. But Hamilton despised the scapegoating of specific groups of Americans by public officials, such as the Tories who remained after the Revolution or immigrants like himself. Hamilton was someone who reflected deeply about public policy and understood the unintended long-term consequences of rash actions by legislatures and policy makers. This is not obvious in the Trump campaign.

National Security and Immigration

Despite his friendship with the Marquis de Lafayette at the Battle of Yorktown, Hamilton resolutely opposed Jefferson’s proposal to support France in her war with England after the American Revolution. Jefferson responded by labeling Hamilton as disloyal to our key ally in the Revolutionary War. In this case, the South, represented by Jefferson, though more isolationist in trade, was much more interventionist in foreign wars. After all, it was Jefferson who sent the American navy to the Barbary Coast. But Hamilton, a long-time aide of Washington, appreciated the warnings of the first president about the new nation entering into foreign alliances.

Hamilton would also understand the need for immigrants as a source of growth. In the 19th century immigrants coming across the Atlantic and Pacific oceans were a source of human capital, bringing  skills and a willingness to move to various parts of the country and work in farming, construction and mining.

Of course, in the 19th century, there were no welfare systems in place, and most of the immigrants arrived as part of closely knit ethnic communities. But again, Hamilton was a forward-looking thinker. If alive today, he would see that without continued immigration, the United States would soon resemble the land of the “setting sun,” Japan. The only way to reduce the age profile of the population, and make the Social Security system sustainable, given patterns in reproductive rates, is to increase the inflow of immigrants, something Japan has been reluctant to do. It is hard to escape the consequences of Trump’s policies. Does he want to put us on course to follow Japan?

Hamilton would also realize the illogic of banning Muslims, or any other identifiable ethnic group, on the basis of their religion. He would argue that an internationally credible reform of U.S. immigration policy requires fairness and non-discrimination on the basis of religion or race. He would also realize that a forced expulsion of illegal immigrants who have been here, for many years, working and supporting families, would be akin to the way the New York Legislature acted against Tories. He would see strong similarities between such expulsions and the proposal of U.S. President James Monroe to relocate freed slaves to Liberia. While Hamilton was a hard-nosed realist about trade and finance, he understood the crucial place of human dignity in the American way of life.

Again, my conjecture is that Hamilton would support Hillary Clinton, very reluctantly, for president of the United States. But I also believe that he would be very disappointed by the overall election campaign of 2016. Someone with a keen sense of justice, he would have been a big fan of the film “The Big Short,” and would be wondering why so few bankers were sent to jail—and why we are not making financial stability, both national and global, the centerpiece of our national political debate.

Paul D. McNelis, S.J.America’s contributing editor for economics, holds the Robert Bendheim Chair in Economic and Financial Policy at the Gabelli School of Business at Fordham University, New York.

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William Rydberg
1 year ago
Perplexing choice, didn't he found BONY? An interesting legacy? Don't think he was a President either... The more interesting question likely is the almost poverbial 'WWJD' - what would Jesus do...
John Walton
11 months 3 weeks ago
@William -- the joke at BONY was Hamilton's departing statement (before his duel): "Don't do anything until I get back." Let's all read Federalist 78 and see what Hamilton would have thought of today's judiciary.
J Cosgrove
12 months ago
Again, my conjecture is that Hamilton would support Hillary Clinton, very reluctantly, for president of the United States. But I also believe that he would be very disappointed by the overall election campaign of 2016. Someone with a keen sense of justice, he would have been a big fan of the film “The Big Short,” and would be wondering why so few bankers were sent to jail—and why we are not making financial stability, both national and global, the centerpiece of our national political debate.
Couple comments" First, I doubt Hamilton would approve of Hillary's economic plan which is the opposite of what we need at the moment. and Second, the reason why no bankers went to jail is that the jails would be too crowded with the politicians who are the real culprits of the mortgage and financial crisis if the truth came out in court proceedings. The politicians forced the bad loan practices on the mortgage lenders. The GSE's in order to meet their quotas encouraged the courting of people who neither had the incomes or the money to pay but utilized these bad loan practices to purchase houses they could not afford. Since these low income people were being courted, those with more money took advantage of the same lack of scrutiny and bought too at these relaxed loan conditions. This sudden and tremendous increase in home buying drove up the price of housing. As Father McNelis should know a limited supply and and a large increase in demand leads to escalating prices, in this case housing prices. And the inevitable collapse came when the poor could not pay off their mortgages even with relaxed loan practices. Look to HUD policies as the cause of the financial crisis. All well documented but not part of the Big Short which while entertaining is not an accurate description of most that went on.
Chuck Kotlarz
1 year ago
A Hamilton quote suggests great wealth perhaps could weaken democracy. "As riches increase and accumulate in few hands, the tendency of things will be to depart from the republican standard (government in which power resides in the people)."
J Cosgrove
12 months ago
Mr. Kotlarz,
As riches increase and accumulate in few hands, the tendency of things will be to depart from the republican standard (government in which power resides in the people)
A couple comments What provided wealth in Hamilton's day is very different from what provides wealth today. In the late 1700's nearly all wealth was in land ownership and since nearly everyone's existence depended upon the land, the land owners did exert real power. But not so in the United States because land ownership was very diffuse and most land was in the hands of individual farmers so there was no issue of a few dominating the many as they have done in most of the rest of the world at that time and for much of history since. Today, something similar and something different exists. Almost no extraordinary wealth is due to land ownership and only a few depend on the land for their substance so the world is very different in this way. Wealth today is mainly due to equity ownership and to a lesser extent cash flow from businesses. And these people like their US counterparts in the late 18th century have little power over the people. Who is increasingly exerting power over the people is not wealthy individuals but the government which is controlling more and more of the economy and the legal expression of what can and cannot be done. So if you are concerned about power, then it here that you should be looking and not at wealthy individuals. Warren Buffet is one of the wealthiest persons in the US but I doubt anyone would accuse him of exerting power over people but he may exert power over the government by lobbying legislatures and bureaucrats. Secondly, much of the wealth of individuals is coming from direct actions of our government which favors a few over the many. This is where you should be focusing your objections and not to wealth per se. In the last Eight years the government under Obama has infused about 10 trillion dollars into the economy in various ways. Most of it has been borrowing to finance the large increases in the federal debt but a large chunk has been the printing of money. Usually this type of activity would create large scale inflation but it has not done so in the elements of the economy from which we measure inflation. It has inflated equity holdings, a lot of it in the stock market or has drifted off to areas outside the United States. This has led to several people accumulating large amounts of money as they become experts at skimming off parts for themselves. But they do not exert power over individuals the way the government does. So maybe you should direct your ire elsewhere.
Chuck Kotlarz
12 months ago
See the above 10/23/2016 post.
Rick Fueyo
12 months ago
Hamilton's record on immigration is a bit more mixed than the post suggests.
Vince Killoran
12 months ago
Hamilton was an elitist who distrusted the common people (and immigrants).
Chuck Kotlarz
12 months ago
Can great wealth cause distortions? For example, the entire legislative and judicial branches of federal government cost $9 billion. Yet in 2016, great wealth will have spent $9 billion on Washington DC lobbyists, presidential and congressional elections. Has great wealth perhaps created a fourth branch of government? Can a distorted economy result from only 10% of the economy’s income gains go to consumers? Consumers drive 70% of the economy. University of California Berkeley economics professor Emmanuel Saez found the top 1 percent captured 90 percent of all income gains from 2009-12.
J Cosgrove
12 months ago
I assume you are all in for Trump because he is talking about what you seem to deplore. http://bit.ly/2dFpmDb
Chuck Kotlarz
11 months 4 weeks ago
The Tax Policy Center notes Trump would cut taxes by $6 trillion over the next 10 years with half going to the top 1 percent. The statement needs a closer look. If $3 billion goes to the top 1 percent, perhaps half of that ($1.5 trillion) goes to the top .01 percent and then half of that ($0.75 trillion) to the top .0001 percent. The top .0001 percent (150 billionaires) could see their ten-year after-tax income increase $750 billion. Forty-five states have annual GDPs less than $750 billion. Add the $750 billion Trump tax cut to the ten year $1 trillion capital gains income of the top 400 Americans. The combined ten-year income would surpass the annual GDP of any state but California. We don't elect any of the top 400 US billionaires or any of their 10,000 lobbyists.

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