Evening star., 1924-02-25
CHAPTER I.
From 41.2O Tax Per Capita to 4S1 so

, George Washington went down
from his home in Mount Vernon,
which Is just across the. Potomac
river from the city. of Washington.
the present capital of the nation, to
New York city. and on April 6, 1888,
TOOK the oath of Office as the first
President of the United States. That
oath of office was taken on Wall
street. just 100 feet across the street
from where the present office of J..
+. Morgan & Co. is located.
The government was new. II had
no departments. Finances then. as
now, were of first importance. 1t is
not surprising that on September 2,
1888. an act was passed by Congress
esti blishing the Treasury Depart
lnent. mod led somewhat after the
iines already laid down by Robert
finance during the period of confed-
Grafton.
George Washington was rich
inan-one of the richest Of his day.
He asked to serve as President with
out pay, but Congress gave him $25.-
600 year. America then was poor
and Lad ID with debts. both domestic
ana foreign. War had done Ii. The
individual states. thirteen in number,
w"r" also burtened with debts. The
TASK was heart breaking one.
w nat are we going to do with this
heavy debt?' Washington is reported
to have asked a close friend.
There is but one man in the
United States who can tell you--that
is Alexander Hamilton" replied the
friend.
On September II. 1889. nine days
after the creation of the Department
o6 Finance, George Washington sent
to the United Stats Senate the name
Secret ry of the Treasury. He had
been adjutant to Washington during
the revolution and Washington knew
his abilities.
Dsbt g Per Cent of Wealth.
Hamilton. orphan of the West
Indies. small Of stature, yet graceful,
magnetic, versatile and imperial, ac-
espted the office; He was now just
the ablest tinancier of his day. 1t
was said ofshim that, reasoning from
facts. on first principles, in close ar
sument. he was unsurpassed In his
slight body lay soul of passionate
a;rdor. OF Immense energy and bound
less prida."
This new government had been
given specific powers by the several
states. The states were Jealous OF
thelr own rights. They were poor
and out of sorts. Their experience
for the ten prec ding years under
the articles of confederation had not
been encouraging. 1t only added to
their anxiety The finances were in
confusion. No one seemed to know
how the finances were to be handled.
Public bonds of the states had sold
as low as IL cents on the dollar.
Could Hamilton unravel this diScour-
aging tangle?
He set to work and for four months
said nothing. Then. on January IA.
1890. he ISSUED his memorable report
on public credit. 1t Is one of the
most famous and interesting reports
in our history.
In a nutshell. the new republic
owed the following debts:
!. Foreign debts. .s11.7o0 900
domestic BITS. .-........ 100000
3. Unfunded paper. ........ 1000. 900
4. State debts. 100000 900
Total. .s76. 400. 900
What should be done about this
debt? Should men who had pur-
chased bonds for Is cents on the dol
lar be paid back 100 cents on the
dollar? Was the government organ
ized to protect the money specu-
lator? 1t was hotly contested. pro
and con.
At this time the national wealth
was estimated to be S1,200.O00.000.
The public debt was about 6 per
cent of the total wealth. The an
nual debt charges before being con-
solidated were $4.5s0.00o-a large
sum for those Gays.
He Rolled Logs and Paid.
Hamilton decided to pay the debts.
dollar for dollar. but not until he
had made political deal of FAR