on the choice of Rufus King and Gen. Schuyler,
thus ignoring the Livingstons, a political blunder
that soon cost the Federalists control of the state
of New York.
In April, 1789, Washington was inaugurated, and when the treasury department was at last or- ganized, in September, he at once placed Hamilton at the head of it. In the five years that ensued Hamilton did the work that lies at the foundation of our system of administration, gave life and meaning to the constitution, and by his policy de- veloped two great political parties. To give in any detail an account of what he did would be little less than to write the history of the republic dur- ing those eventful years. On 14 Jan., 1790, he sent to congress the first " Report on the Public Credit," which is one of the great state papers of our history, and which marks the beginning and foundation of our government. In that wonderful document, and with a master's hand, he reduced our confused finances to order, provided for a funding system and for taxes to meet it, and displayed a plan for the assumption of the state debts. The finan- cial policy thus set forth was put into execution, and by it our credit was redeemed, our union ce- mented, and our business and commercial pros- perity restored. Yet outside of this great work and within one year Hamilton was asked to report, and did report fully, on the raising and collection of the revenue, and on a scheme for revenue cut- ters ; as to estimates of income and expenditure ; as to the temporary regulation of the currency ; as to navigation-laws and the coasting-trade; as to the post-office ; as to the purchase of West Point ; as to the management of the public lands, and upon a great mass of claims, public and private. Rapidly, effectively, and successfully were all these varied matters dealt with and settled, and then in the succeeding years came from the treasury a re- port on the establishment of a mint, with an able discussion of coins and coinage ; a report on a na- tional bank, followed by a great legal argument in the cabinet, which evoked the implied powers of the constitution ; a report on manufactures, which discussed with profound ability the problems of political economy and formed the basis of the pro- tective policy of the United States ; a plan for an excise ; numerous schemes for improved taxation ; and finally a last great report on the public credit, setting forth the best methods for managing the revenue and for the speedy extinction of the debt. In the midst of these labors Hamilton was as- sailed in congress by his enemies, who were stimu- lated by Jefferson, led by James Madison and Will- iam B. Giles, and in an incredibly short time, in a series of reports on loans, he laid bare every operation of the treasury for three years, and there- after could not get his foes, even by renewed in- vitations, to investigate him further.
Outside of his own department, Hamilton was hardly less active, and in the difficult and troubled times brought on by the French revolution he took a leading part in the determination of our foreign policy. He believed in a strict neutrality, and had no leaning to France. He sustained the neu- trality proclamation in the cabinet, and defended it in the press under the signature of " Pacificus." He strenuously supported Washington in his course toward France, and constantly urged more vigorous measures toward Edmond Charles Genet (q. v.) than the cabinet as a whole would adopt. During this period, too, his quarrel with Jefferson, which really typified the growth of two great po- litical parties, came to a head. Jefferson sustained and abetted Freneau in his attacks upon the ad- ministration and the financial policy, and upon the secretary of the treasury most especially. Hamilton, too, forgetful of the dignity of his of- fice, took up his pen and in a series of letters to the newspapers lashed Jefferson until he writhed beneath the blows. At last Washington inter- fered, and a peace was patched up between the warring secretaries; but the relation was too strained to endure, and Jefferson soon resigned and retired to Virginia. Hamilton was contemplating a similar step, but postponed taking it because he wished to complete certain financial arrangements, and he also felt unwilling to leave his office until the troubles arising in Pennsylvania from the ex- cise were settled. These disturbances culminated in open riot and insurrection ; but Washington and Hamilton were fully prepared to deal with the emergency. A vigorous proclamation was issued, an overwhelming force, which Hamilton accom- panied, was marched into the insurgent counties, and the so-called rebellion faded away.
Hamilton now felt free to withdraw from the cabinet, a step that he was compelled to take from a lack of resources sufficient to support a growing family, and he accordingly resigned on 31 Jan., 1795. His neglected practice at once revived, and he soon stood at the head of the New York bar. But even his incessant professional duties could not keep him from public affairs. The Jay nego- tiation, which he had done much to set on foot, came to an end, and the treaty that resulted from it produced a fierce outburst of popular rage, which threatened to overwhelm Washington him- self. Hamilton defended the treaty with voice and pen, writing a famous series of essays signed " Camillus," which had a powerful influence in changing public opinion. He was also consulted constantly by Washington, almost as much as if he had continued in the cabinet, and he furnished drafts and suggestions for messages and speeches, besides taking a large share in the preparation of the " Farewell Address."
Hamilton not only corresponded with and advised the president, but maintained the same relation with the members of the cabinet, and this fact was one fruitful source of the dissensions that arose in the Federalist party after the retirement of Washington. Hamilton supported John Adams loyally, if not very cordially, at the election of 1796, and intended to give him an equally loyal support when he assumed office, but the situation was an impossible one. Adams was the leader of the party de jure, Hamilton de facto, and at least three members of the cabinet looked from the first beyond their nominal and official chief to their real chief in New York. If Adams had possessed political tact, he might have managed Hamilton; but he neither could nor would attempt it, and Hamilton, on his side, was equally imperious and equally determined to have his own way. The two leaders agreed as to the special commission to France, and the commission went. They agreed as to the attitude to be assumed after the exposure of the "X. Y. Z." correspondence, and all went well. But, when it came to the provisional army, Adams's jealousy led him to resist Hamilton's appointment to the command, and a serious breach ensued. The influence of Washington prevailed, however, and Hamilton was given the post of inspector-general. For two years he was absorbed in the military duties thus imposed upon him, and his genius for organization comes out strongly in his correspondence relating to the formation, distribution, and discipline of the army. In the mean time the affairs of the party went from
