The Founders, Free Markets, and Sound Money

Julia Shaw / September 07, 2010

When most people think about the Founders and economics, two common myths arise. The first is that the Founders vehemently disagreed about economics and, therefore, reached no consensus on the subject. This contention is evident in Alexander Hamilton’s and Thomas Jefferson’s famous exchange about whether the American economy should consist of self-sufficient farming or a commercial empire of manufacturing. The second myth is that the Founders saw little or no role for government in the economy—that they embraced a purely laissez faire economic theory.

Thomas G. West puts an end to these two myths with his latest First Principles Essay The Economic Principles of America’s Founders: Property Rights, Free Markets, and Sound Money. Indeed, Jefferson and Hamilton vigorously disagreed on some economic issues, but they shared common principles regarding fundamental economic policy. Second, the Founders envisioned a vital role for government in the economy—not by relying on experts to regulate in fine detail the use of property and foster mass redistribution of wealth—but to establish and maintain the basic protections of the rule of law. (more…)