Bank+Of+The+United+States+Alexander+Hamilton+P1

The Bank of the United States was established in Feb 1791 by Congress. However, it was very controversial because the newly created Constitution did not give power to establish a central bank, but Federalist claimed it was entitled to the federal government under their implied powers. Its first acts were to loan the federal government two million dollars and appoint Thomas Willing ,the mayor of Philadelphia as president. It restrained powers on the state banks because it did not accept state currency. The bank was still competative with state banks and was invested by the government which meant it dominated over them. When the Democrats won the majority of Congress and refused the renewal of the 20 year charter in 1811, and the bank was repayed by the government and then closed.

The Bank of the United States was the brain child of Alexander Hamilton. Hamilton felt that the federal government needed a repository for government funds and the federal government need an organization to act a fiscal agent. He was also the one that conviced President Washington to sign the controversal bill. The opponions claimed that the power was not stated in the constitution so therefore, unconstitutional. However, Hamilton stated that because the constitution did not limit the use of a federal bank, so it was legal and included in its implied powers. The bank like the rest of Hamilton's economic plan favored industry and commerce over agrarian interests.

Questions- 1) How would having a central bank harm the economy? 2) Because the 10th Amendment is not yet part of the constitution, how can you say that it is unconstitutional? 3) What do you suggest is a better policy for the economic status?