Part of the ‘Compromise of 1790’, Hamilton’s proposal as Treasury secretary, to nationalise state-level debts, is inseparable from US white-supremacist history. When Hamilton’s first attempts to achieve his purpose met no success, he negotiated a compromise with Jefferson, then secretary of state, and James Madison, member of the House of Representatives—both from the Virginia plantation elite. The compromise involved two apparently unrelated political steps.
The southern plantation elite in Congress agreed to take on the debt of the northern, non-slave states by supporting the Assumption Act of 1790. In return, the southern elite achieved its goal of locating the national capital in slave territory, with the creation of the District of Columbia via the Residence Act of the same year. [...]
This arrangement fits neatly into the propaganda of the ‘frugal four’: Merkel, Macron and the commission want the long-suffering northern-European taxpayer to take on the debts of feckless southern governments. Yet Europeanising debt aims to avoid sovereign-debt speculation, not shift the cost of debt service. As a result, it would reduce the likelihood of a northern ‘taxpayer bailout’ of southern-European governments.
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