In 1785, Benjamin returned home to Philadelphia after a very successful nine years spent in France. Mayer decided it was an opportune time to go to America. He would spend some time with Haym Salomon, Robert Morris, Ephraim Hart and the Gratz Bros, and have the added pleasure of meeting with Benjamin. He had arranged to be in America around August, but upon hearing of Haym’s passing, he had left immediately and had arrived in New York in late June. Haym and Ephraim had recently gotten the Bank of New York, a branch of the Bank of North America, up and running, and it was proving to be a huge success. Robert Morris who had just resigned as Superintendent of Finance was by Ephraim’s side, and that had been very reassuring for the business community of New York.
Hart was at dockside to welcome him when he arrived, and the first thing Mayer wanted to see was the building that housed the Bank of New York. The Bank of Philadelphia on Chestnut Street in Philadelphia had become the Bank of North America in 1782, but the Bank of New York built by Haym on St. George Street in NY was the new seat of power. When Mayer saw the building, he was very proud indeed, but his thoughts quickly turned to Haym. He was very grateful for all the work he had done, and he asked to be driven to Haym’s residence in order to pay his respects to his wife. He would visit the bank later.
Haym was thought to be a very wealthy man, for he and Morris had officially organized and financed the meeting of the politicians in Philadelphia in 1774 and had supplied military equipment to all the militias from the very beginning. Nobody knew Haym had been working for Mayer, and being so busy with what he was doing, Haym had put very little money aside for himself and his family. So, Mayer wanted to tell his wife that she didn’t have to worry about the welfare of her family, and that Ephraim Hart would make sure that the family’s future was secure.
After spending the night at Ephraim’s mansion, the two men met with Robert Morris the next morning in the executive offices of the bank. The mood was one of friendship and celebration. These men, not excluding Haym of course, had accomplished a great deal in a very short time, and Mayer was justly proud of their achievements. With the Bank of New York as the new seat of power, with branches already built in Philadelphia and Boston and others being built in the other capitals of the 13 Colonies, Mayer’s federal bank was here to stay. The merchants and the politicians had no choice but to acknowledge that this financial institution was formidable, and no one was inclined to regret the Continental Dollar. Unofficially, there was only one currency in the 13 Colonies, the US dollar, and it was the currency that would continue to be used in the existing branches of the Bank of North America. It would become the official currency of the nation when the Constitution was ratified.
Many in Congress reviled the unknown bankers that were supposedly getting fabulously rich running the Bank of North America, and Morris, who had been the Superintendent of Finance as well as the bank’s main shareholder in lieu of Mayer, had quietly resigned. Although the central bank was stable, inspired confidence, and was helping the economies of the 13 Colonies grow at breakneck speed, and although it was becoming, like the Bank of England, an indispensable financial institution, it was best not to foment envy. So, Mayer, in wanting to keep feelings under control in Congress, and wanting to maintain a low financial profile, had asked Morris to resign from the post of Superintendent of Finance. When George Washington became President, and there was no doubt about that, Morris would encourage him to nominate Alexander Hamilton to the new post of Secretary of the Treasury. In the interim, three nondescript commissioners would fill in as managers of the country’s finances.
When George Washington became President in 1789, as planned, he appointed young Alexander Hamilton who was more than qualified for the job of Secretary of the Treasury. The young prodigy from New York, who had recommended Robert Morris for the post of Superintendent of Finance in the first place, had been a protégé of George Washington during the revolutionary war and had drawn up the constitution of the Bank of America in 1781 as well as that of the Bank of New York in 1784. His nomination to the post of Secretary of the Treasury was accepted without opposition.
Alexander Hamilton, a man of questionable lineage had come to New York by way of the Caribbean islands. Thanks to a clergyman who recognized his talent, he came to New York and studied at King’s College. He was a brilliant student and a courageous one. In August 1775 he formed a militia called the Hearts of Oak which later participated in a successful raid against the British. He had seized the cannons stored in the Battery at the tip of Manhattan in spite of being under fire from HMS Asia. Alexander was naturally made Captain in the Continental Army. He was rapidly promoted to the rank of Lt. Colonel in George Washington’s ‘family’ of aide-de-camps. He became disgruntled when he lost his most favored position to the young Marquis de Lafayette when the latter arrived from France in 1777, and he resigned his commission. Morris had taken him under his wing and had sent him back to King’s College to study law. In 1779, he introduced him to Elizabeth Schuyler, the daughter of a very wealthy merchant, and he married her in 1780. In 1781, he fought at Yorktown, and then rejoined his wife in Albany where he got special permission to pass the bar exam before the required time of internship. He was elected to Congress and was appointed receiver of taxes for NY in 1782. In 1783, he practised law in NYC where he defended the rights of returning loyalists. Morris liked his opinions concerning central banking and central government and had hired his law firm to draft the incorporation documents for the Bank of New York. Hamilton had used the Bank of England as a working model, like he had for the Bank of America in 1781 as per Mayer’s instructions, and he had done a superb job in both cases.
Mayer, Robert and Ephraim adjourned for lunch with the intention of inviting Alexander Hamilton to the afternoon session. After lunch, when Mayer was introduced to Hamilton, he congratulated him on his drafting of the bank’s constitution. Mayer didn’t think it was necessary to say more for now, though he was definitely impressed by the young man. Mayer turned the discussion to another matter that was on all their minds, the Constitution of the United States of America. They all knew they had to act fast, especially when the two biggest Colonies, Virginia and New York, were both reticent to the idea of a strong central government.
An initial constitution in its most simplistic form had to be drafted as soon as possible, one that could easily be signed by all. Since the agricultural states in the south disagreed with many of the ideas held by the merchants in the north, and since many in both camps were anti-federalists, it was imperative to have the document written by a southerner who believed in a strong central government in collaboration with someone from the north who had the same convictions. Thomas Jefferson from Virginia had been the obvious choice, but he was presently in France, so James Madison, his closest associate, who had drafted Virginia’s Constitution, was the next best choice. When Mayer asked if anyone knew of someone from NY who would be prepared to work with Madison and had the necessary skills to sell the newly drafted constitution to the New York Congress, all eyes turned to young Alexander.
Hamilton felt he had to say something and simply said he would be honored to help out in whatever way he could. He had met James Madison and he thought highly of him. He, like the others, knew that if New York and Virginia, both anti-federalist states, were made to take the lead and sign the Constitution, then it would be easy to get the other Colonies to come on board. All agreed that Hamilton was the right man for the job, but since he was from NY, they further agreed that it would be better if it was written by Madison who was from the south. Hamilton simply added that he would be willing to cooperate wholeheartedly with Madison who was perfectly qualified to draft the official document, and that he would welcome Madison’s input in helping him promote it via the local newspapers. He was convinced they would work well together, for they both believed in a strong federal state.
Mayer was quite happy with that answer and told him so, but not being inclined to squander praise, he immediately brought up the other pressing matter, that of the assumption of war debts. Mayer told them he was going to Philadelphia to meet with Benjamin Franklin who had arrived from France. Benjamin was getting on in years and was thinking of retiring, and Mayer would try to convince the ‘Father of Independence’ to accept a seat in the Senate and use his influence while working with Morris. The two men would spread the word that war debts incurred by the individual Colonies would be forgiven if they surrendered their rights regarding the lands east of the Mississippi, the lands that had been ceded by England in the recently signed Paris Peace Treaty, to Congress. All the federalists were bound to welcome such an initiative, and by going along with it, the 13 States would be officially recognizing the authority of Congress and the existence of the Bank of North America. The desired political union would be achieved, and the bank would become entrenched as the official financial institution. Best of all, the compromise would in no way affect the bottom line of the Bank of North America. The war debt incurred by the Colonies would simply be transferred and become a federal debt. The amount owed Mayer’s bank, the Bank of North America, would remain unchanged, only the name of the debtor would change.
When Mayer asked Morris, what progress was being made, he answered using colourful language. The whole universe tended to take the path of least resistance, like water flowing downhill, and people were part of that universe. By facilitating the solution of a problem with a financial enticement, all the states were bound to welcome the initiative, it was just a matter of time. They were all amused by his rhetoric, for they all knew he was right
Mayer told him not to take anything for granted and to keep pushing as hard as he could. He was to spread the pork freely, and to wine and dine everyone who needed to be swayed. Results were all that mattered. Then he turned to Hart and asked him how the Bank of New York was doing. Ephraim answered that confidence in the bank was growing on a daily basis, and that the specie accumulating in the bank’s vaults was having a snowball effect as expected.
Mayer had already inspected the bank’s vault, so the news didn’t take him by surprise. He then turned his attention to another pressing political matter. They all knew that George Washington would be acclaimed President when the Constitution was signed, but the two major obstacles, that of getting the Constitution drafted and signed, and finding a place to house the President and Congress were pressing matters. He wanted to know what the politicians were saying and turned to Morris once again. Morris said that as far as the Constitution was concerned, there was no consensus, but agreed that it was indeed a good idea to have James Madison and his staff in Virginia draft the Constitution in consultation with Alexander Hamilton and his staff in New York. As for a President, there seemed to be no real opposition to the candidacy of George Washington. The residence of the President and the Government, however, was another matter. Morris went on to say that the only way to satisfy the two big States, Virginia and New York, was to locate the houses of government in a neutral central place like at the head of the Potomac River.
Mayer then turned to Hamilton to ask him if he had further suggestions with regards to the drafting of the Constitution. Alexander reiterated that he was more than willing to work with Madison, for he was the most qualified, having already drafted the Constitution of Virginia. As far as he was concerned, the only thing that was absolutely imperative was to have a tripartite system, one where the three branches of power, the legislative, the executive and the judiciary were separate. He and his staff could start promoting the ideas of federalism by publishing weekly instalments in all the local papers, something that could be called the Federalist Papers. He was ready to start as soon as Mayer gave his OK, and he added one more thing. If the Constitution was to be kept simple in order for everyone to sign it at the earliest possible time, as suggested by Mayer, it was imperative to keep the Bill of Rights out of it. They would have to make that very clear and promise the politicians that as many amendments as necessary could be added after the signing. That would keep the debate wide open while making it possible for everyone to sign.
Mayer agreed, of course. For now, selling the idea of forgiving the war debts of the major colonies, and offering generous compensations to those with little war debt in exchange for giving up their land claims, was urgent. Morris and Hart would continue coordinating the bank’s activities, those of Philadelphia, Boston and New York as well as the others being created. Madison and Hamilton were to have all the financing needed to have the constitution drafted in the shortest delays. The last item that Mayer wanted to bring up was the trade issue with Britain.
According to Ephraim, there was a great cry to re-open trade with England. The merchants had always traded with England, and although the States had signed an Alliance Treaty with France in 1778, trading with that country was proving to be very unsatisfactory. Something had to be done to stimulate transatlantic trade. Mayer said he would decide what to do after meeting with Franklin.