USA HISTORY

Detailed explanation-1: -Hamilton issued a bold proposal. The federal government should pay off all Confederation (state) debts at full value. Such action would dramatically enhance the legitimacy of the new central government. To raise money to pay off the debts, Hamilton would issue new securities bonds).

Detailed explanation-2: -In addition to paying the debts of the national government at face value, Alexander Hamilton called for the federal government to assume (i.e. pay) the war debts still owed by the states. This would increase the national debt by approximately $20, 000, 000.

Detailed explanation-3: -One of the most contentious issues in the report was Hamilton’s recommendation that the Federal Government assume the states’ substantial Revolutionary War debts. Hamilton believed this was necessary to establish the United States’ credit and promote investment.

Detailed explanation-4: -In his landmark “Report on Public Credit, ” Hamilton made a proposal that would send shockwaves through the leadership of the new nation. During the American Revolution, the states (former colonies) incurred significant debts. Hamilton proposed that the new Federal Government assume the state debts.

Detailed explanation-5: -Hamilton’s next objective was to create a Bank of the United States, modeled after the Bank of England. A national bank would collect taxes, hold government funds, and make loans to the government and borrowers.