1. The Hamiltonian View: This view, named after Alexander Hamilton, the first Secretary of the Treasury, believed that a central bank was necessary to regulate the economy and promote economic growth. Hamilton argued that a central bank could provide a stable currency, control the money supply, and facilitate commerce. He believed that a central bank would also help to manage the public debt and provide financing for government spending.
2. The Jeffersonian View: This view, named after Thomas Jefferson, the third President of the United States, opposed a central bank. Jefferson and his supporters believed that a central bank would give the federal government too much power over the economy and would lead to corruption and favoritism. They argued that a central bank would benefit only the wealthy and would harm the interests of farmers and other ordinary citizens.
The Hamiltonian view ultimately prevailed, and the First Bank of the United States was established in 1791. However, the bank's charter was not renewed in 1811, and it was replaced by the Second Bank of the United States in 1816. The Second Bank of the United States was also controversial, and its charter was not renewed in 1836. After the Civil War, the Federal Reserve System was established in 1913 to provide central banking functions for the United States.