You should send…someone…a copy of this book

Thomas K. McCraw, The Founders and Finance: How Hamilton, Gallatin, and Other Immigrants Forged a New Economy.

Airmail, I would think.  Hurry.

I also have received William L. Silber’s Volcker: The Triumph of Persistence, which looks quite interesting.


One of these days, somebody is going to write a serious book about the most brilliant intellectual contribution of 18th Century America: Benjamin Franklin's 1751 essay "Observations Concerning the Increase of Mankind," which made Franklin the intellectual father of Malthus and the grandfather of Darwin.

Bro, I read and enjoy your blog. But this topic doesn't have a damn thing to do with immigration or differences in population groups.

Oh no, it literally has everything to do with exactly that. Well. Good day.

Maybe America can solve its current financial issues by drawing tips from its new generation of immigrants? Illegals can teach us how to budget on very low incomes. Like maybe the United States could share a studio apartment with three other families or send its children (Guam?) to public schools that it doesn't pay for or have its hospital expenses written off?

Very subtle.

Okay, who is going to send TC the book?

I have it already, try sending one across the Atlantic...

Might be hard to overnight with an October 15th release date...

America was able to handle its Revolutionary War debts because we enjoyed a staggering profitable export boom during the Napoleonic Wars. The Napoleonic wars may have devastated much of Europe and left the UK profoundly in debt. However, they were immensely lucrative over here.

From "Napoleonic Wars, Impact on the U.S. Economy" (

"As a neutral country the United States could claim unfettered trade with all countries, including Britain and France, and for the most part American ships were welcomed with open arms. American ships carried commodities from all over the world and distributed European manufactures in ports worldwide. Freight earnings boomed. In 1792, American shippers earned an estimated $7.2 million. By 1796 these earnings had tripled to $21.6 million and eventually peaked at $42.1 million in 1807.

As income from the trade boom diffused throughout the economy, the United States experienced dramatic export-led growth. Between 1792 and 1795, U.S. exports doubled; they doubled again in 1801, and by 1807 were five times what they had been fifteen years earlier. Moreover, the rate of growth in foreign trade far outstripped that of population. Per capita income from exports, shipping services, and ship sales averaged $6.77 in 1792. In 1807, the per capita figure was $22.76. This boom in American export trade reflected heavy European demand for re-exports (foreign goods repackaged in American ports), American cotton, (used to supply the British textile industry), and American food to meet European shortages. "

The export boom led to an import boom which provided a flood of tariff revenues for the Federal government. See The national debt fell from $83 million in 1800 to $45 million in 1811. Did talented immigrants help create America's financial system? No doubt. However, the economic success of the early Republic was a product of America's farmers and European war madness. To claim otherwise is just more Open Borders pleading.

A useful note is that Hamilton and his colleagues were never free traders. Indeed, a tariff act was the very first substantive law passed by the new national Congress in 1789. The tariff was raised many times and it provided virtually all of the governments revenues for many years.

Have you read it?

Clever title. An alternative title could be, The Iroquois and Sovereign Debt: How Indigenous American Open Borders Policy Financed the Revolutionary War.

Sounds like an argument for very limited, high-skills immigration.

Until this comes up in a relevant topic, I thought I'd share this with the folks here.

"Do Women Earn Less than Men?"

Boy do I wish we'd get these analyses on the basis of family units, the actual economic "deliverable."

Of course another group of immigrants also helped pay off the war debts (which I thought were mainly eroded through inflation, repudiation and conversion to land grants anyway - or was that just domestic lenders?) But they came from another part of the world, in different ships, wearing chains.

I don't suppose the book discussed them at all?

Which makes me suspect the main theme of the book as laid out in the brief summary I have seen. All those Virginian slave owners existed in a world of international trade and credit. They exported cotton to the Europeans. They imported slaves. They almost certainly did so on credit - debt being a big part of Thomas Jefferson's life. What makes anyone think that they need someone from another slave owning society, or even from Geneva, to tell them about the advantages of international finance?

I'm looking forward to this. Hamilton's contribution to US economic history is truly under appreciated by most US citizens.

It doesn't come out till October. Hoping I'll get asked to review it for a journal to get an early peek.

Hey CC, any thoughts on this?:

"We find a remarkably strong impact of colonial European settlement on development. According to one illustrative exercise, 47 percent of average global development levels today are attributable to Europeans. One of our most surprising findings is the positive effect of even a small minority European population during the colonial period on per capita income today, contradicting traditional and recent views. There is some evidence for an institutional channel, but our findings are most consistent with human capital playing a central role in the way that colonial European settlement affects development today."

Perhaps we could send... someone.... a copy of this study. A fungiblist, maybe? A co-blogger?

Comments for this post are closed