Congress founds U.S. Treasury - HISTORY
Year
1789

Congress founds U.S. Treasury

On this day in 1789, the United States Treasury Department is founded.

The institution’s roots can be traced to 1775, when America’s leaders were looking for ways to fund the Revolutionary War. Their solution–issuing cash that doubled as redeemable “bills of credit”–raised enough capital to fuel the revolution. but also led to the country’s first debt. The Continental Congress attempted to reign in the economy, even forming a pre-Constitutional version of the Treasury. Neither this move, nor the signing of the Declaration of Independence, which enabled the U.S. to seek loans from foreign countries, proved effective. The debt kept mounting, while war notes rapidly deflated in value.

With the ratification of the Constitution in 1789, the American government established a permanent Treasury Department in hopes of controlling the nation’s debt. President George Washington named his former aide-de-camp, Alexander Hamilton, to head the new office. The former New York lawyer and staunch Federalist stepped in as Secretary of the Treasury on September 11. Hamilton soon outlined a practical plan for reviving the nation’s ailing economy: the government would pay back its $75 million war debt and thus repair its badly damaged public credit.

Hamilton had been elected to the Continental Congress from New York in 1782. He demonstrated a near-reactionary political philosophy and quickly became known as a determined proponent of a stronger national government. Hamilton published several papers with James Madison and John Jay arguing for the ratification of the U.S. Constitution that are now known as the “Federalist Papers.” As the first secretary of the treasury, Hamilton established most of the centralized monetary institutions of the new nation, including the national bank, before resigning in January 1795. Hamilton then returned to the private sector and a law practice in New York City, but remained a close advisor to President Washington.

In 1800, Hamilton became embroiled in a bitter dispute when he threw his support behind President John Adams’ reelection campaign instead of presidential candidate Aaron Burr’s. After his defeat, Burr ran for governor of New York in 1804; Hamilton again opposed his candidacy. Humiliated, Burr challenged Hamilton to a duel on July 11, 1804, in Weehawken, New Jersey. Alexander Hamilton was shot in the duel and died of his wound the following day, July 12, in New York at the age of 49.

ALSO ON THIS DAY

Vietnam independence proclaimed

Hours after Japan’s surrender in World War II, Vietnamese communist Ho Chi Minh declares the independence of Vietnam from France. The proclamation paraphrased the U.S. Declaration of Independence in declaring, “All men are born equal: the Creator has given us inviolable rights, ...read more

The Battle of Actium

At the Battle of Actium, off the western coast of Greece, Roman leader Octavian wins a decisive victory against the forces of Roman Mark Antony and Cleopatra, queen of Egypt. Before their forces suffered final defeat, Antony and Cleopatra broke though the enemy lines and fled to ...read more

Japan surrenders

Aboard the USS Missouri in Tokyo Bay, Japan formally surrenders to the Allies, bringing an end to World War II. By the summer of 1945, the defeat of Japan was a foregone conclusion. The Japanese navy and air force were destroyed. The Allied naval blockade of Japan and intensive ...read more

Great Fire of London begins

In the early morning hours, the Great Fire of London breaks out in the house of King Charles II’s baker on Pudding Lane near London Bridge. It soon spread to Thames Street, where warehouses filled with combustibles and a strong easterly wind transformed the blaze into an inferno. ...read more

First ATM opens for business

On this day in 1969, America’s first automatic teller machine (ATM) makes its public debut, dispensing cash to customers at Chemical Bank in Rockville Center, New York. ATMs went on to revolutionize the banking industry, eliminating the need to visit a bank to conduct basic ...read more

Allies celebrate V-J Day

On this day in 1945, the USS Missouri hosts the formal surrender of the Japanese government to the Allies. Victory over Japan was celebrated back in the States.As Japanese troops finally surrendered to Americans on the Caroline, Mariana, and Palau islands, representatives of ...read more

Ho Chi Minh dies

President Ho Chi Minh of the Democratic Republic of Vietnam dies of a heart attack in Hanoi. North Vietnamese officials announced his death the next day.Ho Chi Minh had been the heart and soul of Vietnamese communism since the earliest days of the movement. Born in 1890, he was ...read more

47th North Vietnamese MiG shot down

Phuc Yen, 10 miles north of Hanoi, and one of the largest air bases in North Vietnam, is smashed by U.S. fighter-bombers. During the attack, a MiG was shot down, bringing the total to 47 enemy aircraft shot down since the beginning of the North Vietnamese offensive. At this ...read more

Whites massacre Chinese in Wyoming Territory

On this day in 1885, 150 white miners in Rock Springs, Wyoming, brutally attack their Chinese coworkers, killing 28, wounding 15 others, and driving several hundred more out of town.The miners working in the Union Pacific coal mine had been struggling to unionize and strike for ...read more

Lord of the Rings creator Tolkien dies

On this day in 1973, J.R.R. Tolkien, the author of the best-selling fantasy novels The Hobbit and The Lord of the Rings–the source of the award-winning blockbuster movie trilogy directed, co-produced and co-written by Peter Jackson–dies at the age of 81 in Bournemouth, England. ...read more

Great Tokyo Fire continues to blaze

On this day in 1923, aftershocks and out-of-control fires continue to rock Tokyo, Japan, and the surrounding area following a massive earthquake. In total, 143,000 people died in the disaster, which is known both as the Great Kwanto Earthquake and the Great Tokyo Fire, as the ...read more

Trial of Mathias Rust begins

The trial of Mathias Rust, the 19-year-old pilot who flew his Cessna plane into Red Square in May 1987, begins in Moscow. Rust had become an international celebrity following his daring intrusion into Soviet airspace and landing in the center of Moscow, but the Soviet government ...read more