Hamilton’s Plan
Hamilton was also well educated, having graduated from what is now Columbia University. He had previously served as an officer in the Continental Army and as private secretary to General George Washington.
As Secretary of the Treasury, Hamilton would focus on the nation’s economy, a subject that had been under harsh scrutiny since the war. He immediately set out creating a financial plan that was heavily criticized by some of his fellow constituents. Hamilton’s plan called to pay back the national debt that was due to the European banks and American merchants who lent them money during the war. He proposed a national budget and a payment plan to pay off their creditors. The government would be able to achieve these payments with the implementation of a tariff, or a tax, placed on imported goods.
Hamilton believed that through regular payments, their creditors would be invested in the progression and development of the United States. In other words they would want the new government to be a success. In 1790, Hamilton’s plan was approved by Congress. In 1791, Congress established the Bank of the United States in an effort to assist with the financial transactions of the plan.