31 March 2011

Book Review

Hamilton’s Curse by Thomas J. DiLorenzo

If you want to know why the United States is all kinds of messed up at this point in history, this is the book to read.  IN fact, even if you think you know why the United States is in the trouble it’s currently facing, this is the book to read.

As any student of history knows, things don’t just happen.  There are always historical precedents and occurrences that lead to other precedents and occurrences, and all these have a cumulative effect.  The overbearing statist federal government of modern America can trace its roots to the ideology and actions of a man named Alexander Hamilton.

The book splits itself neatly into three parts.  In the first part, we are introduced to Hamilton, and given an overview of not only his philosophy but also his actual policies and precedents.  In part two, we see how his precedents have been carried out through history.  In part three, DiLorenzo offers some methods for undoing the damage wrought by Hamilton.

In the first part, it becomes rapidly clear that Hamilton was a staunch supporter of the large and overbearing state, and that he was quite fond of mercantilism.  This led him to creating a central bank, raising tariffs, and federalizing the debt.  By sheer coincidence, he happened to profit quite handsomely when he federalized the war debt, as did a number of his banker friends.  He also supported the whiskey tax, and was in charge of prosecuting violators.  It seems that his only objection to English control of the colonies was that it prevented Hamiltonian control of the colonies.

In the second part, we next see that Hamilton’s disciples follow his philosophy to its logical ends.  Hamilton’s chief disciple was John Marshall, head of the Supreme Court.  Many of decisions blatantly ignored constitutional limits, and attempted to federalize power.  (Incidentally, Supreme Court decisions were treated as non-binding, so it wasn’t uncommon for citizens to laugh off court injunctions.)  Lincoln was also a disciple of Hamilton’s and also supported mercantilist policies, as well as general meddling.  Like Hamilton, Lincoln was not afraid of suppressing those who disagreed with him, nor was he afraid of exercising federal power, particularly when it came to taxes.  Lincoln, by the way, was the first president to institute an income tax.

In the third part, DiLorenzo offers a way out.  Much of this revolves around the idea of taking back power, and undoing key accomplishments (like the central bank).  There are certainly a lot of goals worth working towards, but DiLorenzo doesn’t touch on very much of them, perhaps because the man knows his limits.  There is, after all, only so much you can do with a book.

In sum, DiLorenzo is an impressive historian with a knack for clear, concise writing.  It also helps that he knows a thing or two about economics.   As such, Hamilton’s Curse is a clear, lucid read that provides great insight into the events of today.

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