September 2, 1789 — The First Congress of the United States was called to convene in New York on March 4, 1789, marking the beginning of government under the Constitution. But it wasn’t until six months later — on Sept. 2, 1789 — that Congress created a permanent institution for the management of government finances.
Alexander Hamilton served as the first Secretary of the Treasury, from Sept. 11, 1789, to 1795. Considered one of the most brilliant statesmen of the early American republic, he was killed in a duel in 1804 by Vice President Aaron Burr. Hamilton had served as George Washington’s aide-de-camp during the Revolution and was of great importance in the ratification of the Constitution. Because of his financial and managerial acumen, Hamilton was a logical choice for solving the problem of the new nation’s heavy war debt.
Hamilton’s first official act was to submit a report to Congress in which he laid the foundation for the nation’s financial health. He insisted upon federal assumption and dollar-for-dollar repayment of the country’s war debt of $75 million in order to revitalize the public credit. He foresaw the development of industry and trade in the United States and suggested that government revenues be based upon customs duties. His sound financial policies also inspired investment in the Bank of the United States, which acted as the government’s fiscal agent.
Words of Wisdom
The debt of the United States' was the price of liberty. The faith of America has been repeatedly pledged for it, and with solemnities that give peculiar force to the obligation.