Thomas Jefferson (1743-1826), drafter of the Declaration of Independence and the nation’s first secretary of state, served as the third president of the United States (1801-09).
Many framers were influenced by the chaotic environment of the Revolution and its aftermath. For Jefferson, a wealthy, slave-owning planter, it was a tour in France as ambassador during the waning years of the Bourbon monarchy in the 1780s that profoundly shaped his philosophy. The experience sealed his conviction that powerful, centralized governments are prone to corruption, debt, and ultimately tyranny. By contrast, the United States – with its rich agricultural resources, independent yeoman farmers, and decentralized collection of states – could avoid this fate as long as it guarded against urban and commercial elites, personified by his rival Alexander Hamilton.
When Hamilton proposed in 1790 the establishment of a Bank of the United States, Jefferson, along with his ally James Madison, led the opposition. This Bank lacked constitutional authority, they argued, because there was no explicit mention of it in the document. And whereas Hamilton argued that the Constitution’s “necessary and proper” clause implied that such a bank should exist, Jefferson rejected the idea that the Bank was truly necessary or even desirable. Both he and Madison also feared that the Bank would be a tool that urban Northern interests could use to dominate the agrarian South, including their home state of Virginia. But President George Washington, also a Virginian, sided with Hamilton, leading the way for the Bank’s charter. He kept Jefferson on as secretary of state, however, and later appointed him to head the US Mint.
The fissures over the Bank prompted Jefferson, Madison, and other like-minded framers to form a new political party, the Democratic-Republican Party, to oppose Hamilton’s Federalists. Jefferson’s narrow victory that handed him the presidency in 1801 was seen as their triumph. In the following eight years, however, his actions as president often strengthened the executive branch, which seemed to run counter to the Democratic-Republican philosophy. The Bank continued to operate and flourish, and Jefferson’s second Treasury secretary, Albert Gallatin, was one of its chief backers. Jefferson also applied a flexible reading to the Constitution’s provisions on executive authority when he approved the Louisiana Purchase in 1803. And within his party, there was growing embrace of commerce and manufacturing, especially in the mid-Atlantic region.
Still, unlike Madison, whose views evolved, Jefferson’s economic philosophy was relatively consistent over time. It held that a national government’s role should be as limited as possible, focusing mainly on defense, with most authorities devolved to the states. As a corollary, taxes and public spending were to stay minimal. Industry should not be favored at the expense of agriculture. And banks, paper money, and especially debt were all inherent dangers to American liberty. “We are ruined if we do not overrule the principles that the more we owe, the more prosperous we shall be,” he stated in his first inaugural address. The nation must elect “between economy and liberty or profusion and servitude.”
BibliographyFatovic, Clement. “Constitutionalism and Presidential Prerogative: Jeffersonian and Hamiltonian Perspectives.” American Journal of Political Science vol. 48, no. 3 (July 2004): pp. 429-44.
Caldwell, L.K. “Thomas Jefferson and Public Administration.” Public Administration Review vol. 3, no. 3 (Summer 1943): pp. 240-53.
Shalhope , Robert E. “Thomas Jefferson's Republicanism and Antebellum Southern Thought.” Journal of Southern History vol. 42, no. 4 (November 1976): pp. 529-56.
Shankman , Andrew. “’A New Thing on Earth’: Alexander Hamilton, Pro-Manufacturing Republicans, and the Democratization of American Political Economy.” Journal of the Early Republic vol. 23, no. 3 (Autumn 2003): pp. 323-52.
Wood, Gordon S. Empire of Liberty: A History of the Early Republic, 1789-1815. New York: Oxford University Press, 2011 (reprint).
Written by the Federal Reserve Bank of Richmond. See disclaimer.