ArtsAutosBooksBusinessEducationEntertainmentFamilyFashionFoodGamesGenderHealthHolidaysHomeHubPagesPersonal FinancePetsPoliticsReligionSportsTechnologyTravel

Alexander Hamilton’s Central Bank

Updated on October 6, 2010

In today’s time there are few larger controversies than the one centered on central bank of America known as the Federal Reserve. Most people if asked would say that the Federal Reserve was started in 1913 with the passing of the Federal Reserve Act by Woodrow Wilson. Most people would be wrong.

The Central Bank of America actually had a much earlier start than most believe. It was originally made by one of the founding fathers of our country, Alexander Hamilton and it did exactly as it does today.

Alexander Hamilton formed the Bank of America in 1784 and became its first director. His objective was to create a central bank modeled after the Bank of England which at the time had been an institution of ruin for England for several decades. The United States government becoming a Federal government under Washington’s presidency was to then assume all the State’s debt and borrow all its money from Alexander’s bank.

In 1791 his goals were realized and the Bank of America received its charter from the US government and became The United States of America’s first Central Bank. The charter ran for 20 years until 1811 (approximated) when it failed to be renewed for five years. After a five year period the Bank of America reacquire its charter and continued to push America into debt, much the same way the Banks of England and France did to their countries.

Not all things went as planned for the central bank though. In 1836 President Andrew Jackson vetoed the bank and it lost its power for 37 years. In 1867 the bank was chartered once again. Finally in 1913 the Bank of America became the Federal Reserve that we all know.

The Central Bank was created to allow people to profit at the expense of the nation and had a great impact on history of America; a history that is often overlooked. To pay for the debt the government accumulated Alexander proposed a tax on goods. After he had become the Secretary of Treasury he pushed a tax on distilled liquor through.

This action resulted in people who lived in the mountains refusing to pay the tax. Alexander insisted to the Washington that he crush this with the militia and Washington did so. These events were known as the Whiskey Rebellion of 1794.

The Central Bank caused the United States much financial distress later on by causing the financial panics of 1893 and 1907. Though Hamilton was long dead by then it was his backers who continued to operate the Bank of America and whom continue to exert much influence over America and it’s foreign policy.

In 1811 The Bank of America Failed to Receive its charter’s renewal but why? It was because of a large opposition to the central bank. They wanted the government to make its own money. Leading the opposition was James Madison and Thomas Jefferson.

Jefferson was did not like the Central Bank for he feared that it would affect America’s foreign policy and America during times of War. His fears as history shows were not unfounded. These worries are illustrated in a letter dated December 13 1803 in which he says:

This institution is one of the most deadly hostility existing, against the principles and form of our constitution. The Works of Thomas Jefferson by Paul Leicester Ford

It continues saying:

… an institution like this, penetrating by its branches every part of the Union, acting by command and in phalanx, may, in a critical moment, upset the government. I deem no government safe which is under the vassalage of any self-constituted authorities, or any other authority than that of the nation, or its regular functionaries. Ibid

Thanks to these men the Central bank’s charter expired but was eventually picked back up after five years.

History shows us that Central banks were made to keep a nation in debt giving a few wealthy people money and power to control a nation and America’s Central Bank was no different. A bank not started in the 19th century but in the late 17th. A bank, which as you have seen has carried a controversy through the ages to modern time, a controversy that people still are as passionate about as Thomas Jefferson and James Madison.




    0 of 8192 characters used
    Post Comment

    No comments yet.


    This website uses cookies

    As a user in the EEA, your approval is needed on a few things. To provide a better website experience, uses cookies (and other similar technologies) and may collect, process, and share personal data. Please choose which areas of our service you consent to our doing so.

    For more information on managing or withdrawing consents and how we handle data, visit our Privacy Policy at:

    Show Details
    HubPages Device IDThis is used to identify particular browsers or devices when the access the service, and is used for security reasons.
    LoginThis is necessary to sign in to the HubPages Service.
    Google RecaptchaThis is used to prevent bots and spam. (Privacy Policy)
    AkismetThis is used to detect comment spam. (Privacy Policy)
    HubPages Google AnalyticsThis is used to provide data on traffic to our website, all personally identifyable data is anonymized. (Privacy Policy)
    HubPages Traffic PixelThis is used to collect data on traffic to articles and other pages on our site. Unless you are signed in to a HubPages account, all personally identifiable information is anonymized.
    Amazon Web ServicesThis is a cloud services platform that we used to host our service. (Privacy Policy)
    CloudflareThis is a cloud CDN service that we use to efficiently deliver files required for our service to operate such as javascript, cascading style sheets, images, and videos. (Privacy Policy)
    Google Hosted LibrariesJavascript software libraries such as jQuery are loaded at endpoints on the or domains, for performance and efficiency reasons. (Privacy Policy)
    Google Custom SearchThis is feature allows you to search the site. (Privacy Policy)
    Google MapsSome articles have Google Maps embedded in them. (Privacy Policy)
    Google ChartsThis is used to display charts and graphs on articles and the author center. (Privacy Policy)
    Google AdSense Host APIThis service allows you to sign up for or associate a Google AdSense account with HubPages, so that you can earn money from ads on your articles. No data is shared unless you engage with this feature. (Privacy Policy)
    Google YouTubeSome articles have YouTube videos embedded in them. (Privacy Policy)
    VimeoSome articles have Vimeo videos embedded in them. (Privacy Policy)
    PaypalThis is used for a registered author who enrolls in the HubPages Earnings program and requests to be paid via PayPal. No data is shared with Paypal unless you engage with this feature. (Privacy Policy)
    Facebook LoginYou can use this to streamline signing up for, or signing in to your Hubpages account. No data is shared with Facebook unless you engage with this feature. (Privacy Policy)
    MavenThis supports the Maven widget and search functionality. (Privacy Policy)
    Google AdSenseThis is an ad network. (Privacy Policy)
    Google DoubleClickGoogle provides ad serving technology and runs an ad network. (Privacy Policy)
    Index ExchangeThis is an ad network. (Privacy Policy)
    SovrnThis is an ad network. (Privacy Policy)
    Facebook AdsThis is an ad network. (Privacy Policy)
    Amazon Unified Ad MarketplaceThis is an ad network. (Privacy Policy)
    AppNexusThis is an ad network. (Privacy Policy)
    OpenxThis is an ad network. (Privacy Policy)
    Rubicon ProjectThis is an ad network. (Privacy Policy)
    TripleLiftThis is an ad network. (Privacy Policy)
    Say MediaWe partner with Say Media to deliver ad campaigns on our sites. (Privacy Policy)
    Remarketing PixelsWe may use remarketing pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to advertise the HubPages Service to people that have visited our sites.
    Conversion Tracking PixelsWe may use conversion tracking pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to identify when an advertisement has successfully resulted in the desired action, such as signing up for the HubPages Service or publishing an article on the HubPages Service.
    Author Google AnalyticsThis is used to provide traffic data and reports to the authors of articles on the HubPages Service. (Privacy Policy)
    ComscoreComScore is a media measurement and analytics company providing marketing data and analytics to enterprises, media and advertising agencies, and publishers. Non-consent will result in ComScore only processing obfuscated personal data. (Privacy Policy)
    Amazon Tracking PixelSome articles display amazon products as part of the Amazon Affiliate program, this pixel provides traffic statistics for those products (Privacy Policy)