Ps 317/hy 304: The American Founding - Alexander Hamilton Rom - The Report on Manufactures

Emilio Nunez-Garcia

Prof. David Hendrickson

PS 317/HY 304: The American Founding

November 11th, 2015

The Report on Manufactures

Alexander Hamilton’s Report on Manufactures was the capstone to his economic Developmental vision. In this final report, Hamilton recommended the restructuring of the economy towards commercial industry in order to correct the balance of trade with England, and strengthen American economic and political independence. Intended to work in conjunction with his previous suggestions on the public credit and the Bank of the United States, the encouragement of manufactures was the most controversial and critical part of his plan to reorient the American economy. The final installment of his plan, the most critical to fulfilling his developmental vision, would inspire fierce ideological debate throughout American history.

The ideological divides between Federalists and Republicans would come to define to ensuing debates over the future direction of the country. These deeply rooted ideological differences were based on past historical experiences and fears of regression. Whereas Hamiltonian Federalists feared economic regression in the most literal sense (the slowing of economic growth), Jeffersonian Republicans feared a regression to European style economics. And so, although the debate was economic in nature, clashing political philosophies created gridlock contributing to one of the first party struggles in American History.

The debate had significant influence over the next century of American economic development. Hamiltonian economics extended their influence throughout the 19th century as America began the process of industrialization, and continued to influence economic and foreign policy until the beginning of World War I. Furthermore, many of the guiding political principles that fueled each party are still relevant to contemporary political discussion. The same beliefs that inspired the first debates between the Federalist system of economic nationalism and the Republican vision of liberty and equality can be still be seen today. Especially with regards to conflicts regarding states rights, and the Federal government’s response to the recent economic meltdown, the debate over the size and strength of the Federal government and its influence over the private sector and states continues to be relevant today. These same clashing political ideologies that gridlocked the federal government in the 1780’s have not been lost to time; they have become engrained in the American political fabric. Thus, examining the relevant historical experiences that inspired these perpetually opposed ideologies is instrumental not only to understanding the congressional failure of the Report on Manufactures, but also