I must share a secret that few know. I can trace my family heritage on my mother’s side to Alexander Hamilton. Hamilton is a co-author of The Federalist Papers, which prescribed a centralized role for the American federal government. (You can read more about Hamilton’s legacy here.) A Founding Father and first Secretary of the Treasury of the United States, Hamilton’s philosophy of economic nationalism is, according to columnist David Brooks, all but abandoned today. We’ve gone too far with government intervention. We have a federal government that caters to the have-nots and demonizes the haves. Hamilton’s vision was for the long haul, not catering to the short-term whim to win voters. Here is an excerpt from Brooks’ column, The Role of Uncle Sam, in the Tuesday, May 29, 2012 issue of The New York Times:
This version of economic nationalism meant that he [Hamilton] and the people who followed in his path–focused on long-term structural development, not on providing jobs right now. They had their sights on the horizon, building the infrastructure, education and research facilities required for future greatness. This nationalism also led generations of leaders to assume that there is a rough harmony of interests between capital and labor. People in this tradition reject efforts to divide the country between haves and have-nots.
Finally, this nationalism meant that policy emphasized dynamism, and opportunity more than security, equality and comfort. While European governments in the 19th and early 20th centuries focused on protecting producers and workers, the U.S. government focused more on innovation and education.
Because of these priorities, and these restrictions on the federal role, the government could be energetic without ever becoming gigantic. Through the 19th century, the federal government consumed about 4 percent of the national gross domestic product in peacetime. Even through the New Deal, it consumed less than 10 percent.
Meanwhile, America prospered.
But this Hamiltonian approach has been largely abandoned.
What do you think the proper role of government is for the Japanese people?