Jefferson’s Federal Debt

In 1801 Jefferson inherited a $112 million federal debt. (Perhaps that was why Adam’s left town on the four AM stage?) Jefferson put his Secretary of the Treasury, Albert Gallatin, to work seeking ways in which to eliminate it .Gallatin brought him a plan that would require 16 years. Jefferson thought they could raise money more quickly by selling off public lands and laying off some of the 118 federal employees.

Armed with these ideas, he went before Congress and included the possibility of shrinking the sizes of the army and navy. When Congress asked what they would do in case of war (Was the War of 1812 already in the works?) he told them armies and navies don’t prevent wars, they most often cause them
They say there is nothing new under the sun. Well, neither was Jefferson’s report. His first year’s summary read much like today’s Wall Street Journal.

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