What was the most pressing issue for Hamilton in office?
The extreme national debt.
100
What is national debt?
The money a government owes.
200
How could Hamilton move the capital?
He couldn't, he convinced his northerner friends to vote for it, and it passed.
200
What kind of people accepted Hamilton's plan?
Many bankers and investors.
200
Where were most of the states that had already repaid their debts?
The south.
200
What is a compromise?
A half-way agreement between two sides.
300
What did the southerners want in return for repaying state debts?
They wanted to capital to be moved to the south.
300
What was the main reason why Madison was against the plan?
Because he was from the south, and many of those states had already paid their own debts.
300
Why did Hamilton think all the debts should be repaid?
Because no countries would trust them and wouldn't loan them any more money.
300
What is a bond?
A certificate that promises to repay the money plus interest by a certain date.
400
Until the new capital was ready, where would it be?
In Philadelphia, where it already was.
400
What is the second reason why Madison was against Hamilton's plan?
He didn't think speculators would deserve all the money that they would earn.
400
What was Hamilton's job in the government?
He was Secretary of Treasury.
400
What is a speculator?
Someone willing to invest in a risky venture in the hope of making a large profit.
500
When would the new capital be ready?
By 1800.
500
Who did Hamilton have to convince?
Congress.
500
What was Hamilton's big plan? (three steps)
1) Buy up all state and federal bonds.
2) Sell new bonds to pay off the debts.
3) When the economy improves, the government could pay off the new bonds.
500
What is a precedent?
An act or decision that sets an example of others to follow.