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

With A Hercules in the Cradle, Max Edling expands on some central themes he developed in his first monograph, notably the centrality of war and finance to early American state-building. His latest book explores the fiscal institutions and fiscal politics of the federal government that helped propel the United States through several wars ultimately to emerge as a burgeoning state of the first order at the close of the Civil War. With occasional forays into comparative analysis, Edling argues that “more than most other nineteenth-century governments, the national government of the United States became unusually good at finding the money it needed to pay for its territorial acquisitions, its military, and its wars” (p. 13).

Among the financial challenges facing the young nation were the extensive debts of the state and national governments and the unwillingness of American citizens to tolerate high taxes, which they believed threatened the security of their property. Edling traces the origins of the first fiscal regime that used powers embedded in the Constitution to erect a national revenue administration modeled on European strategies for debt management. Students familiar with this transformation will see few surprises here, as Edling describes the Federalist consolidation of the debt and its transformation into long-term securities with the interest paid by customs duties. It is at this point that Edling begins to provide a new understanding of American fiscal history by revealing how federal consolidation allowed state governments to reduce taxes sharply to pre–Revolutionary War levels during the 1790s, which paralleled significant declines in political insurgency.

He then demonstrates continuity rather than change across shifts in party power. Not only did the Jefferson and Madison administrations carry out Federalist plans to retire the Revolutionary debt, they took on new debts to fund the Louisiana Purchase and go to war against Britain. Indeed, through the core of the book, Edling produces granular analysis of fiscal strategies to demonstrate convincingly that it “was the self-proclaimed enemies of central government and public indebtedness, politicians in the Jeffersonian and Jacksonian antietatist tradition, who made the most extensive use of the federal government and its capacity to raise money in order to realize policy objectives” (p. 14).

Indeed, Albert Gallatin established through “a process of trial and error . . . a formula for raising loans that proved to be both workable and durable and served as the model for financing both the Mexican War and the early stages of the Civil War” (p. 126). This formula included raising customs duties—thus keeping internal taxes low—and selling temporary bank loans, short-term Treasury notes, and long-term securities. Only when the enormous costs of the Civil War outpaced the capacity of the loan market to support it did Congress turn to direct taxation and the creation of legal tender notes (greenbacks). Moreover, northerners demonstrated a willingness to accept a new tax regime, initially to preserve the Union and then as a permanent solution to support the much larger government that existed in the aftermath of war.

A Hercules in the Cradle is an important and readable book that recontextualizes political and policy debates through the Civil War by employing skillful analysis of enigmatic financial records. He also carves out new historiographic territory, bridging arguments about the strength of the federal government that have largely focused on the bookends of the period. For his comparisons to the Mexican and British financial strategies and capacities, he relies primarily on secondary sources and he is not as critical of those historiographies as he might be. But this is not a meaningful detraction from what is otherwise a significant contribution to our understanding of the early American national state.