1. Hamilton’s Financial Plan

2. Who is Alexander Hamilton?
Federalists
Strong supporters of Constitution
Businessman from New York
Helped create the New York Bank

3. Dilemma: How do we solve the nation’s debt?
Revolutionary War = National & State debt

4. Hamilton’s solution The Assumption Plan
Have the nation assume ALL the debt from the states and the nation

5. Assumption Plan Goals Hamilton’s Goals
Pay states’ and national debts in full (pay back war bonds)
Raise revenue
Convince Southern states to accept the plan
Why?
Restore faith in public credit
Show strength in national government
To pay off the debt
Pass Tariffs
Pass a tax on whiskey
Southern States already paid off most debt

6. Assumption Plan Simulation
Everyone gets candy BUT you can’t eat it! (yet…)
Snickers = Northern Industrialists
3 Musketeers = Southern Plantation Owners
Butterfinger = Northern Financiers
Milky Way = Southern Lenders
Twix = Western/Appalachian Farmers
Gobstoppers = common folk
Which group in America do you represent?

7. Hamilton Assumption Plan in Action
Goal #1 = Pay full price
How? Assume all states debt and guarantee that debts will be 100% paid back to lenders
What does this do?
Erases state debt…yeah!!
But most Southern states had already paid debt off…so now they would be essentially paying debt twice…boo. 
So…
Southern Lenders (Milky Way) end up having to pay $$ to Northern Financiers (Butterfinger)
Lenders give their candy to financiers

8. Hamilton Assumption Plan in Action
Goal #2 = Raise Revenue
How? Tariffs on imported goods
What does this do?
Protects Industrialists in U.S. because imported goods cost more $$
Hurts plantation owners in U.S. because they can’t buy foreign goods as cheaply
So…
Southern Plantation Owners (3 Musketeers) end up having to buy Northern Industrialists products (Snickers)
Plantation owners give their candy to industrialists

9. Hamilton Assumption Plan in Action
Goal #2 = Raise Revenue
How? Tax on whiskey made and sold
What does this do?
$ from tax would pay off state and national debt…Yeah!!
However, whiskey is made from grain.
Farmers grow grain -> make whiskey -> pay tax 
So…
Western/Appalachian Farmers (Twix) end up having to pay $ to Northern Financiers (Butterfinger)
Farmers give candy to financiers

10. Hamilton Assumption Plan in Action
Regular/Common folk (Gobstoppers) did not lend $ and don’t have $ to buy goods or build factories
So…are you glad to be a regular/common person?

11. What were the consequences of Hamilton’s Assumption Plan?
Effect #1: Which groups seemed to benefit the most?
Effect #2: Sectionalism begins…between which two groups? Why?
Effect #3: Financiers win (Hamilton’s friends) Consequences for social classes?
Effect #4: Farmers really lose (Jefferson’s friends)
Class divisions grow: Wealthy make more $$ and poor have no real benefit

13. Give the candy back!
You can eat now as you reflect on the solutions (and problems) presented by Hamilton’s Financial Plan.