A Hercules in the Cradle: War, Money, and the American State, 1783–1867 by Max M. Edling (review)

Max M. Edling seeks to correct what he sees as the “general neglect” of military and diplomatic affairs in the historiography of early U.S. territorial expansion by focusing attention on institution building by the fledgling federal government, a process that he argues was necessary to “secure American interests in the international arena” (6). The United States, he says, first emerged within a well-developed transatlantic system characterized by warring empires. Thus it had to face overlapping, antagonistic claims on the North American continent not only from competing European powers like Great Britain and France, but also from Indian confederations in the western interior. The strength of the young agrarian republic was predicated upon the ability of the federal government in two arenas: in facilitating the growth and consolidation of territorial gains, often by coercive means; and in fostering increased international trade. Both actions led the government into the treacherous waters of foreign relations. Edling points out that such commitments were evident much earlier in American history than is usually recognized, as is demonstrated by the U.S. consulates and naval squadrons that dotted the globe even before the Jacksonian era.

Underlying this gradual, inexorable projection of American power on a global stage was the early establishment of a “European-style ‘fiscalmilitary state’” (108), which featured flexible institutional mechanisms that could finance such expansion—most notably, strong public credit. In the first three of his book’s six chapters, Edling examines the foundations laid during the first two decades following the American Revolution. The fight for independence had left the former colonies saddled with enormous debts, both individually and collectively, as well as with a weak central government that was unable to deal effectively with myriad problems represented by these outstanding domestic and foreign obligations. In his discussion of these issues as reflected in the framing of the Constitution of 1787, Edling somewhat downplays the impact of taxpayer insurrections such as Shays’s Rebellion—which have previously drawn a great deal of scholarly attention—on the financial powers of the proposed new government. Instead, he emphasizes how intertwined problems concerning requisitions, revenues, and commercial regulations preoccupied the delegates in Philadelphia. Edling describes the ways that divisions between northern and southern states emerged in the context of the delegates’ heated if rather arcane debates. Along with a limited duty on slave imports, an important outcome of these negotiations was the constitutional prohibition on national export taxes. Both measures were intended to mollify the slave states.

Apart from a widespread distaste for paper money, the federal government’s “power to borrow was a relatively minor issue” in the Philadelphia debates, Edling argues. Rather, “the delegates focused overwhelmingly on the existing debt rather than on future exigencies” (41). In this sense, the creation of an American fiscal regime began in earnest under the Federalist administrations of the 1790s, particularly under the aegis of the first secretary of the treasury, Alexander Hamilton. Throughout the book’s early chapters, Edling continues the recent rehabilitation of Hamilton’s historiographical reputation (and keeps the reputation of Hamilton’s rival, Thomas Jefferson, on the wane). Edling resists the Madisonian argument that many original holders of Revolutionary-era promissory notes, especially veterans, were essentially being cheated by Hamiltonian policies that reimbursed their new holders, usually wealthy speculators, at full face value. Edling instead argues innocuously that Federalist policies “aimed to modernize American public finances by introducing contemporary European practices of debt management” (83). Despite what he characterizes as “rhetorical steam,” Edling maintains that the so-called Revolution of 1800 represented “no great break” with Federalist policies (87). He insists that Jefferson and his successors not only availed themselves of the well-designed credit mechanisms first developed by the Federalists, but even “proved to be much more active than their more cautious predecessors” in that regard (107).

The proof in the proverbial pudding was the great...