Freedom From Fear
The currency crisis had also created disaffection among the military veterans, who had been paid in Continentals and had watched their war wages fade to nothing following the end of the war. Daniel Shays, an honored soldier and farmer began collaborating with former members of the Sons of Liberty, most prominently Samuel Adams and Colonial Regulators to begin arming veterans for an insurrection against the oppressive post-Revolutionary oligarchical state. Adams had accused the merchant classes of manipulating access to foreign currency to pay down their own debts by reducing specie availability and then increasing the debts of others by increasing the availability of specie when loans were made to farmers. Daniel Shays opposed the local Massachusetts Courts on the grounds of debt relief, but the courts seized his lands and the lands of many others on behalf of the ruling Boston merchants; effectively using debt, taxation and litigation to deprive Shays and the farmers of their property rights in order to deliver their property into the hands of the oligarchy.
The governor, Daniel Bowdoin, had vigorously attempted to counter the policies set by John Hancock as the previous governor which allowed for devalued currency to be accepted in equivalent value to the dollar for payment of debts. This was successful in insulating Massachusetts farmers from the federal currency collapse and allowed for the exportation of devalued currency from the state keeping inflation and new loan interest low. Bowdoin, using the national debt as a political shield, stepped up tax collections and land seizures leading to general protests against his leadership and accusations of collaboration with the merchant oligarchy. Protests led by Daniel Shay’s broke out in what would become known as Shay’s Rebellion; militias assaulted police and tax collectors, shut down the courts and targeted members of the oligarchy for public beatings.
The state of Massachusetts descended into a state of civil war as middle and working class rebels engaged with pro-oligarchical militias throughout the state, by 1786 the situation had grown direly out of control and the oligarchs enlisted 3,000 mercenaries to help them finish the conflict. Samuel Adams, seeing a threat to the power of the landed classes throughout the country, switched allegiances claiming Shay’s was being backed by British agents and that rights to a trial should be suspended on grounds of treason. By early 1787, the mercenary army in addition to the continental army led by George Washington suppressed the rebellion and Marshall Law was declared to maintain control over the state; anyone deemed to have participated in the rebellion was stripped of their rights as Freemen. Bowdoin would use his response to the rebellion to help formulate the Federalist ideology, calling a strong centralized oligarchical government that could prevent the return of what he regarded as ‘peasant rebellions’. Many of the leaders of the rebellion fled to Canada and Vermont following the conflict leading to the creation of the temporary Vermont Republic and the State of Vermont itself.
The outcome of the conflict led to the collapse of Bowdoin’s abilities to govern and a landslide reelection of John Hancock, who largely granted clemency to all of the rebellions participants. Hancock cut taxes and restructured the state economic system at the expense of the Merchant oligarchy using avoidance of another rebellion as a pretext. Thomas Jefferson did not fear the rebellion spreading further, stating in his infamous ‘Tree of Liberty’ speech that the bloodshed of the conflict was a good thing for maintaining order among the classes and would dissuade further conflicts related to the matter. George Washington on the other hand viewed the rebellion with great alarm, calling for constitutional and government reforms, fearing an eventual civil war and overthrow of the oligarchy by the lower classes; Washington understood the desires of the laborers and farmers, as they had all fought in the Revolutionary War as patriotic equals. Washington was also aware that English espionage with the Native Americans had not ceased despite the end of the war and that some oligarchical entities had considered a bid to return to English rule in despair over the very obvious failures of the Second Continental Congress and the oligarchical states governments. Washington used his influence to bring these oligarchs into the federalist fold, promising a strong central government like that of England’s, which would bring both peace and prosperity through law and order. Federalism and Anti-Federalism would emerge from this conflict among the oligarchical elite, those who wished a new stronger central government and those who wished to retain their power within the competing oligarchical republican states.
In the Constitutional Convention of 1787, Shay’s Rebellion and the threat to oligarchical rule was discussed at length. Those who had previously opposed the formation of a central government and a strong national military under the Anti-Federalist banner abandoned these positions, citing the lack of coordination by both the state and congressional governments in being able to effectively put down Shay’s Rebellion. The ultimate concern of the oligarchs was the preservation of their wealth and power, ideological compromises would have to be made in order to protect their assets from the revolts of the lower classes. What was also addressed was the inefficiency and corruption of the court systems; robbers and vigilantes had used the confederacy system to commit crimes in some states and flee to others for legal asylum, a tactic used by the Southern planter class to destabilize the North for what they called ‘economic warfare’ against the South. The idea of a Popular Vote was immediately rejected at the Convention on the grounds of the rebellion in favor of an Electoral Vote that could nullify the Popular Vote and ensure oligarchical control over the Republic at all times. Initially House Representatives and Senators were to be chosen only by the state legislatures of the oligarchical elite.
The model for the Republic of Venice was decidedly adopted over those of the Athenian and Spartan Greek city-states. A Doge-like executive would be selected as President to be the direct commander-in-chief over the armed forces to clear bureaucratic gridlock and allow for a swift military response to domestic rebellions. A Gran Consiglio of a legislative branch representing the interests of the elite would be created as a counterweight to the President and finally a Venetian Council of Ten or the Supreme Court would be introduced as a third branch judicial body to balance out the other branches. The Republic of Venice was an oligarchical empire that had managed its society through long periods of prosperity through strict laws, political intrigue, domestic surveillance and very strict oligarchical class control. This was assumed to be a more powerful form of government for the American oligarchy and an effective answer to the lack of a strong and willful state. The new Constitution would be created to keep everything the oligarchy had won from their British counterparts, make a compromise on the representation of the middle and lower classes, and create a mechanism of legal control over the populace that could be used to coordinate domestic military operations when needed.
After the Philadelphia Convention, leading figures in the war, Patrick Henry, Samuel Adams and Richard Henry Lee publically opposed the constitution citing Anti-Federalist values, citing a threat to individual rights and the promotion of the Presidential position as a return to monarchy. It should be noted that Adams and Lee had played major roles in the previous government and had concerns about the decline of oligarchical rule in the colonies in favor to the central government of the constitution. Thomas Jefferson, another anti-federalist warned against popular votes and popular politics being manipulated by the constitutional government, citing an impending ‘Tyranny of the Majority’ that would strip ‘Freemen’ of their class interests. Patrick Henry wrote extensively of fears that the Federalists sought to create a new aristocracy that resembled the British peerage system, which was not too far from the truth for many Federalist oligarchs.
The Massachusetts Convention in 1788 was very vitriolic and contentious. Fist fights broke out at the convention between members of the federalist and anti-federalist factions. The impasse between the two groups finally ended when Samuel Adams and John Hancock (also an Anti-Federalist) threatened to unite the Northern farmers against the Convention and overthrow the government of the Confederation unless Constitutional amendments and a Bill of Rights was included. The landed oligarchs took the threat very seriously; Hancock had already made good on several earlier threats and the popularity between Hancock and Adams as ‘men of the people’ would have brought the population behind them. The Constitution was ratified with the debate over the amendments to continue in the 1st US Congress. George Washington was nearly unanimously elected to be the First President of the United States in 1789, viewed by both oligarchical factions and the public alike with immense respect, he would serve as the compromise candidate to get the ball rolling on the new administration of government.
Washington saw his goal as stabilizing the new republic from the past ten years of economic strife. He signed Jay’s Treaty with England, a new trade agreement that would take off some of the international currency pressures against the dollar. Washington set standards for the presidency, only serving two terms to symbolically reject the notion of military dictatorship, and despite being immensely wealthy, accepting the Presidential salary to establish it so less wealthy men could serve in the position. Washington, understanding that he was setting the tone for years to come rejected the use of aristocratic titles for government positions and accepted opposing views in the form of civil debate, rejecting the notion that the Presidency was an office of political violence and potential tyranny, like many of the governors had come to be seen.
The Constitution was largely influence by Alexander Hamilton who had sought to avert the financial collapse of the new republic and contain the potential British influence that could come from it. His initial propositions to have representatives for life modeled after the House of Lords led to accusations of British collaboration which at times were historically murky given the situation at hand. However Hamilton’s proposals to fix the economy as Secretary of the Treasury contradicted this notion, he allowed the federal governments to assume all revolutionary debt from the states in exchange for a centralization of the currency system. Wealthier states and their representatives like Thomas Jefferson and James Madison opposed this debt centralization plan, citing that their taxes would be used as a form of a bail out for less fortunate states; Hamilton saw Jefferson and Madison as being firmly entrenched in their oligarchical beliefs and positions from previous years citing the currency issues that had arisen between the states.
The original three interests of the revolution would firmly split into two camps over the idea of a National Bank:
“Madison objected to Hamilton’s proposal to lower the rate of interest and postpone payments on federal debt as not being payment in full; he also objected to the speculative profits being made. Much of the national debt was in the form of bonds issued to Continental veterans, in place of wages the Continental Congress did not have the money to pay. As the bonds continued to go unpaid, many had been pawned for a small fraction of their value. Madison proposed to pay in full, but to divide payment between the original recipient and the present possessor. Others, such as Samuel Livermore of New Hampshire, wished to curb speculation, and reduce taxation, by paying only part of the bond. The disagreements between Madison and Hamilton extended to other proposals Hamilton made to Congress, and drew in Jefferson when he returned from serving as minister to France. Hamilton’s supporters became known as Federalists and Jefferson’s as Republicans.”
Alexander Hamilton and Thomas Jefferson were Washington’s top advisors and bitter rivals; Hamilton who had a close relationship with the landed gentry of England through his own family ties sought to create a national banking system to restore American credit and turn the US into an economic force. Jay’s Treaty with Britain was denounced as a result of Hamilton’s close ties to the British and an affront to the French, who were undergoing a republican revolution of their own. Jefferson and his allies supported the anti-monarch bourgeoisie in France and saw Hamilton’s reconciliations as attempts to thwart their plans. Jefferson’s views were largely oligarchical and he sought to restore the predisposition of the Confederation period stating that he was “in a struggle between the Treasury department and the republican interest.”
“Hamilton suggested that Congress should charter the National Bank with a capitalization of $10 million, one-fifth of which would be handled by the Government. Since the Government did not have the money, it would borrow the money from the bank itself, and repay the loan in ten even annual installments. The rest was to be available to individual investors. The bank was to be governed by a twenty-five member board of directors that was to represent a large majority of the private shareholders, which Hamilton considered essential for his being under a private direction. Hamilton’s bank model had many similarities to that of the Bank of England, except Hamilton wanted to exclude the Government from being involved in public debt, but provide a large, firm, and elastic money supply for the functioning of normal businesses and usual economic development, among other differences. For tax revenue to ignite the bank, it was the same as he had previously proposed; increases on imported spirits: rum, liquor, and whiskey.”
The United States owed a national debt of $90 million in 1790, equivalent to roughly 2.3 billion dollars in debt today; Hamilton came up with a number of alternative solutions to handle the debt that were enabled through various property and excise taxes. Hamilton had also been instrumental in putting the standard for a bimetallic currency in the Constitution to enable the US to mint its own gold and silver coins and finally run the Spanish gold coin out of circulation. Hamilton argued that by undermining gold to maintain a high price and oversupplying West Indies silver imports to keep the silver price low, silver coins would always be readily available to expand the money supply when needed; Hamilton also proposed the minting of smaller value coins of silver and copper for small transaction with the lower classes. He created a naval inspection service called the Revenue Cutters, a precursor to the Coast Guard, whose primary purpose was to crack down and tax interstate smuggling, especially between anti-federalist oligarchical rivals trying to dodge taxes.
Tensions however would rise as Hamilton’s policy popularity led to a number of public declarations in favor of the merchant oligarchy over the agrarian oligarchy, citing French economic theories that pushed for an advanced manufacturing based economy to pay off large debts. The Copper Panic of 1789 would destabilize the Presidency of George Washington, along with Hamilton’s Policy. The Confederation states had minted their own coins using copper to create a hard currency alternative to the devaluing continental; the British had attempted to destabilize the economic markets by having spies introduce counterfeit copper coins into the American market creating a surplus of the coins and lowering the value of copper. The counterfeiting intensified during the period of Shay’s Rebellion, compounded by the fact that states had engaged in following John Hancock’s lead in exporting the fiat Continental currency and borrowing and issuing new loans with the copper currency. This led to debt disparities between the states and states engaging in copper counterfeiting of their own to contain the exported inflation. By 1789, the market was flooded with the debased coins, sharing an inflation rate well over 400% and the ability to do commerce with the coins ceased; state banks tried to stem the currency circulation by issuing new fiat but this was stopped by Hamilton who feared a return to the Confederacy system and its hyperinflationary issues. The copper was taken out of public circulation leading to another contraction in the public money supply and of available credit.
The Copper Panic and the Whiskey Excise Tax created an uproar among the farming community. Whiskey had been a frontier form of exchange and the new taxes made it less desirable, cutting into the incomes of the poor and farming classes. The farmers outside of the states especially resented the tax because they did not have Congressional representation and farmers who did have representation did not feel fairly represented, leading back to the ‘no taxation without representation’ conundrum that they had spent a decade fighting to free themselves from. A fresh bout of Indian attacks on Western frontier pushed the Ohio Valley farmers into a state of rebellion as they felt the new government was no different from the old despite the progress that had been made. Local Republican oligarchs preyed upon this sentiment politically, hyping up merchant class conspiracies to defraud the poor of their wealth and enlisting them in ad hoc conventions to discuss new types of republican government. In 1793, hostilities intensified as tax collectors became the victims of lynch mobs, and effigies of local governors were burned publically. In 1791, the Whiskey Rebellion broke out when several rogue distillers refused to pay taxes; Hamilton was accused, even by many modern historians, of exacerbating the controversy by issuing federal subpoena’s to the frontier distillers to create a popular revolt against direct oligarchical taxation that could be crushed by the military to enrich the creditor class at the expense of the taxpayers once the tax system had been enforced. Many historians believed that Hamilton created the excise tax as a means of social discipline against the veterans of the lower classes for the incidents of Shay’s Rebellion and the earlier military payments crisis in 1783.
Western Pennsylvania entered a state of full blown rebellion, peace talks had been a formality by Washington’s government and Hamilton had issued the spread of countryside propaganda to denounce the claims of the rebels. The rebellion demanded concession of rights for the poor and landless Americans but this was refused in favor of military action and domestic policing to suppress the rebellion. Washington empowered the governors to establish deputized militias that would suppress the gathering of any new militias in Western Pennsylvania. Washington led the American army into Pennsylvania to put down the rebellion, appointing Alexander Hamilton the field commander after tactical control of the region was established. Most of the leaders of the rebellion fled west or into Canada, the participants captured were convicted of treason and later pardoned in 1794.
Many oligarchs viewed Washington’s actions favorably, demonstrating decisive military action and government authority in stemming rebellions and enforcing the rule of law. Anti-Federalist oligarchs became more accepting of the new Constitution following this incident but played on agrarian fears to create political distrust against Hamilton and the Federalists, promoting the power of Thomas Jefferson and Aaron Burr as political contenders to replace the President. Jefferson left Washington’s cabinet after the Whiskey Rebellion, the two would never speak again as Washington considered Jefferson as having a financial hand in the rebellion to undermine the Constitution and of being an agent to French interests. Washington did not trust the new French aristocracy of the Jacobins and their policies of ‘Continental Freemasonry’ which Washington felt were against the principles of traditional oligarchical rule and suggested questionable political morals. Washington’s reasoning’s brought about Republican accusations of close ties to British Freemasonry and the British Royal Family, especially following the political events of Jay’s Treaty which Washington had primarily agreed to as a means of controlling debt.
George Washington’s Farewell Address was an important moment for the continuation of republicanism and for the inspiration of democracy within the new American country. Washington was deeply concerned by the civil-political divisions that Hamilton and Jefferson had generated within the new and fragile republic. Washington warns the American public that their independence from the European powers, safety and domestic peace were dependent on the unity between the states and the people. He said that because of this foreign power and domestic tyrants alike will incessantly and fervently work to divide the country to maintain control over it. Washington warns to be suspicious of anyone that promotes secession or sectionalism as a means to accomplish goals, for they are surely to be under the influence of a foreign power. He urges people to put their identities as Americans above their political, racial, and regional identities, place liberty and unity above all else as one. Washington cites several examples of how American unity benefits the welfare of the country and then warns against an overgrown military establish, which he regards as a threat to liberty and a path to military tyranny. Washington warns against anyone who states that the United States is too large to be ruled by one government or that any further state divisions are needed. He then offers strong warnings that the true motives of a sectionalist are to create distrust or rivalries between regions and people to gain power and take control of the government.
“Washington points to two treaties acquired by his administration, Jay Treaty and Pinckney’s Treaty, which established the borders of the United States’ western territories between Spanish Mexico and British Canada, and secured the rights of western farmers to ship goods along the Mississippi River to New Orleans. He holds up these treaties as proof the eastern states along the Atlantic Coast and the federal government are looking out for the welfare of all the American people and can win fair treatment from foreign countries as a united nation.” He continued on supporting the Constitution over the Articles of Confederation….“and reminds the people that although it is the right of the people to alter the government to meet their needs, it should only be done through constitutional amendments. He reinforces this belief by arguing that violent takeovers of the government should be avoided at all costs and that it is in fact the duty of every member of the republic to follow the constitution, and submit to the laws of the constitutional government until it is constitutionally amended by the majority of the American people. Washington warns the people that political factions who seek to obstruct the execution of the laws created by the government, or prevent the constitutional branches from enacting the powers provided them by the constitution may claim to be working in the interest of answering popular demands or solving pressing problems, but their true intentions are to take the power from the people and place it in the hands of unjust men. Despite Washington’s call to only change the Constitution through amendments, he warns the American people that groups seeking to overthrow the government may seek to pass constitutional amendments to weaken the government to a point where it is unable to defend itself from political factions, enforce its laws, and protect the people’s rights and property. As a result he urges them to give the government time to realize its full potential, and only amend the constitution after thorough time and thought have proven that it is truly necessary instead of simply making changes based upon opinions and hypotheses of the moment.”
Washington strongly warns against the influence of political parties and their influence on a man’s right to vote. He derides them as oligarchical special interests that do not have the interest of the republic or the common good at heart. Washington was clearly referring to the oligarchical regionalism that was promoted by Thomas Jefferson which sought to benefit the Southern Planter oligarchy and prohibit Merchant Class relations with England. Washington also advocated neutrality between France and Britain, something neither party wanted to do.
“While Washington accepts the fact that it is natural for people to organize and operate within groups like political parties, he also argues that every government has recognized political parties as an enemy and has sought to repress them because of their tendency to seek more power than other groups and take revenge on political opponents. Moreover, Washington makes the case that “the alternate domination” of one party over another and coinciding efforts to exact revenge upon their opponents have led to horrible atrocities, and “is itself a frightful despotism. But this leads at length to a more formal and permanent despotism.” From Washington’s perspective and judgment, the tendency of political parties toward permanent despotism is because they eventually and “gradually incline the minds of men to seek security and repose in the absolute power of an individual.” Washington goes on to acknowledge the fact that parties are sometimes beneficial in promoting liberty in monarchies, but argues that political parties must be restrained in a popularly elected government because of their tendency to distract the government from their duties, create unfounded jealousies among groups and regions, raise false alarms amongst the people, promote riots and insurrection, and provide foreign nations and interests access to the government where they can impose their will upon the country.”
Washington continued on in the speech to promote the new system of Venetian Government as a means of controlling the oligarchical interests, exalting the system as being able to maintain an oligarchical balance in the interest of power. He warns against the use of force and pushes the use of amendments in changing the nature of the government, referring to the violence and terror of the French Revolution occurring at the time. Washington calls for the diffusion of knowledge to prevent an uneducated populace and calls for a maintenance in ethics and morality to ensure the prosperity of culture:
“Of all the dispositions and habits which lead to political prosperity, religion and morality are indispensable supports. In vain would that man claim the tribute of patriotism, who should labor to subvert these great pillars of human happiness, these firmest props of the duties of men and citizens. The mere politician, equally with the pious man, ought to respect and to cherish them. A volume could not trace all their connections with private and public felicity. Let it simply be asked: Where is the security for property, for reputation, for life, if the sense of religious obligation desert the oaths which are the instruments of investigation in courts of justice? And let us with caution indulge the supposition that morality can be maintained without religion. Whatever may be conceded to the influence of refined education on minds of peculiar structure, reason and experience both forbid us to expect that national morality can prevail in exclusion of religious principle.” – George Washington
Washington continues with declaring that public credit is a source of strength and security. He urges the preservation of credit through avoiding war, unnecessary borrowing, and paying off war debts as quickly as possible in times of peace to prevent economic decline. He also implies that the government should choose carefully how to tax to pay off debt and that some goods and services are better left untaxed, alluding to the rebellions over Federalist excise taxes. Washington once again warns of foreign nations using espionage to influence domestic events, citing good diplomatic relations as key but that only ‘real patriots would remain uninfluenced’ by the desires and recommendations of foreign governments who would seek only their own gain. Washington warns against ‘entangling alliances’ alluding to the royal families of Europe and their warlike ambitions, recommending only treaties of convenience and trade not military commitment. He defends the neutrality of the United States and states that the US ‘has the right’ to remain neutral in foreign politics. He concludes the address by asking the American peoples to forgive his sins and failures, hoping that they will pay heed to his final warnings.
As we look at America today, we must take Washington’s warnings to heart. The state of the republic reflects that of the Articles of Confederation with oligarchical tyranny and corruption of institutions being the law of the land; Washington’s desires for the people to be able to change their government has not come to pass with ease and many age old outlying problems of the republic goon without being addressed. Solutions are stifled by the Republican and Democratic parties, owned by oligarchical entities now more than they ever were, with two studies from Princeton and a French author showing that public influence over government decisions is practically non-existent. The political parties today represent the oligarchical elite of international business with hardly a landed class or a merchant class to be represented among the internationalist power elite. They manipulate the value of our currency and the cost of goods and services in order to establish class domination and rule over government, clearly just as they always have. The Middle Class of America must come to a realization that their existence is not natural, but economically and politically unique; and that in order to retain their position of society they must keep to Washington’s warnings of vigilance about the fragility of republicanism and democracy especially among the midst of oligarchical corporate predators. Consider how far we have come since the Days of the Articles of Confederation, and ask yourself sociologically what has changed? Why do we continue to pass our decision making on to oligarchical elites? When will we be prepared for direct democracy ourselves, not held hostage by the cheque of an elite electoral college but of a true rule by the majority, by the greater interest of the people? Shouldn’t the United States be the tyranny of the majority, a class of true freedom and liberty? Or will we forever be hostages of the wealthy’s paradise, a Venetian Republic.
-The Green Chazzan
Cooke, Jacob Earnest. Alexander Hamilton. Charles Scribner’s Sons, 1982. ISBN 0-684-17344-1.