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Alexander Hamilton’s tenure as the country’s first Treasury Secretary was a stormy one. In those 5 years, he had overseen the creation of America’s financial system and a national bank. He had witnessed the first stock offering and, a few months later, the first stock market crash. He had created a system by which the fledgling U.S. Government could pay down its debts and establish good credit with foreign powers. Ultimately, he set in motion (in the 1790′s) many of the financial principles we still utilize today.
Alexander Hamilton had also made quite a few enemies.
His views (and his actions) produced, in the minds of his opponents, a stronger central government than was necessary or desired, and it brought him into sharp debate with them. These “anti-federalists” (those against a strong federal government) argued long and loud against the ”federalists”, claiming their final plan was a return to the hated monarchy. And while Alexander Hamilton was not the leader of the Federalist party – that honor went to President Washington and Vice President Adams – Hamilton became the poster-child for all that was wrong with their philosophy. He was the Anti-Federalist whipping boy.
His opponents scoured the “Hamiltonian landscape” for anything untoward…any kind of official misconduct that could form the noose of his political lynching. For several years they peered into the records. But Alexander Hamilton, as many of you know, was painstakingly precise with the books. Any appearance of official misconduct was abhorrent to the young Secretary. Anti-Federalists pored in vain over the ledgers and found nothing…until 1794.
In the spring of that year, they discovered what they thought to be the smoking gun. Back in 1790, Congress had set aside monies to be used to pay overseas creditors. Hamilton had diverted some of the funds to domestic spending, after consulting with the President…but Hamilton had no evidence to prove the meeting took place. President Washington was consulted and, 5 years after the fact, had no evidence of the meeting, either…and no recollection that it had taken place. The President was quick to add that, if the meeting had taken place, he was sure he would have advised Hamilton to do what was consistent with the Congressional directives of the legislation.
To some degree, the President had thrown his Secretary to the wolves.
The formal inquiry turned up Hamilton’s misconduct (which we’ll visit in a couple weeks), but none of it was official. Hamilton ended up being exonerated of any misappropriation. The damage, however, had been done. The Secretary felt betrayed. The character of his office had been called into question, and that was anathema to Hamilton. And while he and the President would remain on good terms (Washington asked Hamilton to compose his Farewell Address just two years later), any blot on his integrity (real or implied) was too much.
But there was more. Hamilton had just return from an exhausting trip west with the President as head of the army. Their mission to squelch the Whiskey Rebellion had been successful, but had served to make Hamilton more hated among the “drinkers of hard liquor”, so much so that he required a six-man escort. And Eliza, his devoted wife, had just suffered a miscarriage, which Alexander largely blamed on the stresses of his constant absence.
On December 1, 1794, America’s first Treasury Secretary announced his departure, effective January 31, 1795. In accepting his Secretary’s resignation, Washington spared little of his most effusive praise. Thinking back over their strong 20-year working relationship, the President cast aside the rantings of Jefferson and the ravings of Madison and wrote, “In every relation which you have borne to me, I have found that my confidence in your talents, exertions, and integrity has been well placed. I the more freely render this testimony of my approbation, because I speak from opportunities of information which cannot deceive me and which furnish satisfactory proof of your title to public regard. My most earnest wishes for your happiness will attend you in retirement.”
Recommended Reading: Alexander Hamilton
