Was the National Bank a Precursor to the Federal Reserve?

Many seem to think so, especially the Federal Reserve. However, Richard Salsman at Duke University doesn’t agree:

Hamilton’s proposed “Bank of the United States” was to be a national bank, but not a central bank in the modern sense of a banker to government, or a bank that issues a monopoly fiat money, controls system reserves, and at root is beholden to the government that sponsors it and makes sure it underwrites (monetizes) and trades its own debt securities, the more so as more debt accumulates. For Hamilton the purpose of establishing a national bank was to asset the Treasury in collection and disbursing revenues (thus more easily servicing the nation debt) and to ensure that the national currency be gold-backed and that private banks issue their own currency by reference to the same uniform standard; above all, the national bank (what became the Bank of the United States, with a limited twenty-year charter lasting from 1791 to 1811) would not be co-opted into becoming the government’s pet bank. (“Hamiltonian Principles of Public Finance as a Guide to Current U.S. Debt Dilemmas,” April 2012)

Salsman is the only person I know who makes this case. I will have to do some more research on this issue. (Stay tuned!)

Happy Thanksgiving!

Whereas it is the duty of all nations to acknowledge the providence of Almighty God, to obey His will, to be grateful for His benefits, and humbly to implore His protection and favor; and — whereas both Houses of Congress have, by their joint committee, requested me “to recommend to the people of the United States a day of public thanksgiving and prayer, to be observed by acknowledging with grateful hearts the many and signal favors of Almighty God, especially by affording them an opportunity peaceably to establish a form of government for their safety and happiness”:

Now, therefore, I do recommend and assign Thursday, the 26th day of November next, to be devoted by the people of these States to the service of that great and glorious Being who is the beneficent author of all the good that was, that is, or that will be; that we may then all unite in rendering unto Him our sincere and humble thanks for His kind care and protection of the people of this country previous to their becoming a nation; for the signal and manifold mercies and the favor, able interpositions of His providence in the course and conclusion of the late war; for the great degree of tranquillity, union, and plenty which we have since enjoyed; for the peaceable and rational manner in which we have been enabled to establish constitutions of government for our safety and happiness, and particularly the national one now lately instituted; for the civil and religious liberty with which we are blessed, and the means we have of acquiring and diffusing useful knowledge; and, in general, for all the great and various favors which He has been pleased to confer upon us.

And also that we may then unite in most humbly offering our prayers and supplications to the great Lord and Ruler of Nations, and beseech Him to pardon our national and other trangressions; to enable us all, whether in public or private stations, to perform our several and relative duties properly and punctually; to render our National Government a blessing to all the people by constantly being a Government of wise, just, and constitutional laws, discreetly and faithfully executed and obeyed; to protect and guide all sovereigns and nations (especially such as have shown kindness to us), and to bless them with good governments, peace, and concord; to promote the knowledge and practice of true religion and virtue, and the increase of science among them and us; and, generally, to grant unto all mankind such a degree of temporal prosperity as He alone knows to be best.

Given under my hand at the City of New York the third day of October in the year of our Lord 1789.

Go. Washington

Paul Sigmund on Whether or Not John Locke was an Individualist

Thanks to the vast scholarship on Locke over the last half century and to the availability of so many original sources, we probably know more about Locke’s thinking than about the thought of any other great political philosopher. A review of the literature demonstrates that there is such a thing as progress in understanding of the classic texts of the history of political thought. In the last fifty years we have learned that Locke was not a covert Hobbesian or an apologist for unrestrained accumulation of property. The arguments that he was a hedonist, materialist, atomistic individualist, collectivist, deist, secularist, advocate of majority tyranny, and naive believer in human perfectibility have been refuted. His views on women and race have been seen as more nuanced than at first appears; distinctions have been made between his original intentions and later interpretations that invoke his name; and many disagreements of the past have given way to a new scholarly consensus because of access to new sources. We have a greater understanding of the continuities and discontinuities with the past represented in his thought, viewing him neither as the central figure in the quasi-Hegelian march of liberalism through history nor as the subverter of the Western tradition. More recently Locke scholarship has made us aware that Locke’s religiously based belief in the possibility of understanding, by the use of reason, God’s intentions for human moral conduct, individually and politically, provides a unity to his political thought, which modern secular commentators had seen as fully of contradictions.

Paul E. Sigmund, The Selected Political Writings of John Locke (New York: Norton Critical Edition, 2006), p. xvii, cited by John D Mueller, “Were John Locke and the Founders “Lockeans”—or Scholastics?” (lecture presented to the John Locke Foundation in Raleigh, NC).

EDIT (16:34 19 Aug 2016): You can find a video excerpt and audio version of Mueller’s talk here.

James Madison: Philosopher of Social Theory?

I’ve been reading Thomas G West’s volume Vindicating the Founders: Race, Sex, Class and Justice in the Origins of America (Rowan & Littlefield, 1997). As I read the chapter on voting requirements and property rights in the American Founding, I found a striking quote by Madison on the nature of theory:

It would be happy if a state of society could be found or framed in which an equal voice in making the laws might be allowed to every individual bound to obey them. But this is a theory which, like most theories, confessedly requires limitations and modifications. And the only question to be decided in this, as in other cases, turns on the particular degree of departure in practice required by the essence and object of the theory itself. (West 122, cf. Mind of the Founder: Sources of the Political Thought of James Madison, 407)

Considering that the Dutch statesman Abraham Kuyper was favorable to the political thought of Hamilton, and that most neo-Kuyperians and Reformational philosophers are interested in the nature of theorizing, perhaps this might serve as a stepping stone towards a comparison of American Federalist and Dutch Reformed political thought?