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Political Parties: Federalists and Republicans


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             Hamilton argued that it was most important to pay all the European debt first. Then attempt to accumulate the rest of the money for the states by putting an excise taxes on whiskey and customs duties on imports. He proposed that the state debt be assumed by the national government and not be made to pay the states. Despite what help these strategies did provide, Hamilton used these ideas as a way to get large state creditors on his side of the government. Other than that, Hamilton also fought for a National US Bank. The bank would raise $10 million through the stocks. The US Treasury would have 1/5 of the stock and the rest would be in the wallets of private investors. They would buy the stocks for 75% of their worth in government bonds and the bank would end up receiving a large piece of the newly funded debt and make it accessible in loans. It would also receive a steady flow of interest payments from the Treasury. He also wanted the US to become a manufacturing nation like Britain. He put protective tariffs on foreign imports so that American citizens would start manufacturing themselves. .
             It was at this time that factions began to formulate. The reports on the state of the US economy favored the wealthy twice fold. Many middle class citizens felt that only significantly wealthy people would be able to attain and keep the stock. They also argued that the assumption of state debt debased the universal theory of equality. The policies appealed to public creditors rather than anyone else and some people believed it was a way for a small group of rich and wealthy people sole control over the government. Thomas Jefferson, Secretary of State and James Madison a member of congress, were the two leaders of the opposing side of Alexander Hamilton. They believed that people belong to the Bank of the United States could end up taking complete control over the national government, especially if people in congress owned shares in the bank because then they would vote for the national bank.


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