That Doesn’t Work Anymore

Chapter 15 The New Role of Capital and Capital Formation

In the hit musical Hamilton, the second act has a song entitled the “Room Where It Happens.” Along with introducing the use of a banjo into hip-hop style music, the song covers a famous compromise in United States history. Alexander Hamilton agrees to move the capital of the new country from New York City to the Maryland–Virginia area in exchange for Virginians James Madison and Thomas Jefferson approving Mr. Hamilton’s financial plan. The plan called for the federal government to become responsible for the Revolutionary war debt of the states. It also effectively allowed for the formation of a central bank. Mr. Hamilton saw the need of the newly independent United States to have access ...