Cross-posted from Channel Surfing:
The Nation has a piece by Richard Kreitner on Alexander Hamilton’s real legacy — a financial system tilted toward investors and a failing New Jersey city that Hamilton essentially created.
Hamilton’s theory was that
industrial America would indirectly benefit the many because it directly benefited the few. “It is a truth as important as it is agreeable, and one to which it is not easy to imagine exceptions, that everything tending to establish substantial and permanent order, in the affairs of a Country, to increase the total mass of industry and opulence, is ultimately beneficial to every part of it,” he wrote. “On the Credit of this great truth, an acquiescence may safely be accorded, from every quarter, to all institutions & arrangements, which promise a confirmation of public order, and an augmentation of National Resource.” Today, we call this trickle-down economics. Hamilton made it the cornerstone of our political order.
The result was an comic bubble that burst in 1792 — and sent numerous Hamilton cronies to jail. Paterson’s population fell from 500 to 43, he writes, and the public-private partnership created to underwrite the city’s creation proved a disaster, thanks to its lack of accountability and surfeit of privilege.
Founded on Hamilton’s hypothesis that the pursuit of private gain could be harnessed to serve the public good, Paterson was a failure from the start.
Paterson rebounded two decades later “after Eli Whitney invented the cotton gin and Jefferson’s controversial embargo of 1807 and the War of 1812 forced the United States to develop its own manufacturing,” made possible, as well, by “the exploitation of slave labor.” The Silk City grew — until labor conditions and rampant inequality led to a massive and violent strike. What followed was a century of collapse.
If Paterson was a pioneer of industrialization in the United States, it was also a pioneer of deindustrialization: In the 20th century as in the 18th (and today), arrangements that relied on the coincidence of the interests of the few with those of the many were in danger of fraying the moment those interests became misaligned.
Ultimately, Kreitner writes, Paterson
was used by its industrial titans so long as it made no claims on their wealth, and abandoned as soon as it did. Ever since, it’s been ignored—by the nation of which it was to be a model and by the wealthier, whiter communities in its own backyard.
I haven’t seen the musical, but it is clear it is not meant as history. The casting choices, the hip-hop songbook, the focus on Hamilton’s origins, all play into the American mythology and contradict the current anti-immigrant zeitgeist in important and transformative ways. The real Hamilton, however, also offers important lessons — about the failures of the American economy, inequality and crony capitalism.