Asked by michael montgomery on Jun 12, 2024
Verified
Examine Alexander Hamilton's proposal concerning assumption of state debts, and discuss the social, economic, and political concepts on which the proposal was based. Why did the proposal arouse opposition in Congress? How was the issue resolved?
Assumption of State Debts
A policy proposal by Alexander Hamilton in the late 18th century, advocating that the federal government assume debts incurred by the states during the American Revolutionary War.
Alexander Hamilton
A Founding Father of the United States, chief staff aide to General George Washington, and the first Secretary of the Treasury.
Opposition in Congress
Instances or movements within the United States Congress where members challenge, resist, or impede policies, legislation, or leadership.
- Appraise the effectiveness of the Confederation Congress in dealing with internal and diplomatic concerns.
Verified Answer
From a social perspective, Hamilton believed that assuming state debts would help to unify the new nation by alleviating the financial burden on individual states and promoting a sense of shared responsibility. Economically, Hamilton argued that assuming state debts would help to establish the creditworthiness of the federal government and attract foreign investment, which was crucial for the nation's economic development. Politically, Hamilton saw assumption as a way to strengthen the power of the federal government and establish its authority over the states.
However, Hamilton's proposal aroused opposition in Congress for several reasons. Many representatives from states that had already paid off their debts were opposed to assuming the debts of other states. There were also concerns about the potential for corruption and favoritism in the process of determining the value of state debts. Additionally, some members of Congress were wary of granting the federal government too much power at the expense of the states.
The issue was eventually resolved through a series of negotiations and compromises. In exchange for support for assumption, Hamilton agreed to locate the new national capital in the South, which was a key concern for many Southern representatives. Ultimately, Congress passed the Assumption Act in 1790, which authorized the federal government to assume the state debts. This decision had a lasting impact on the nation's financial system and the balance of power between the federal government and the states.
Learning Objectives
- Appraise the effectiveness of the Confederation Congress in dealing with internal and diplomatic concerns.
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