Articles of Interest

The Independent Treasury: Origins, Rationale, and Record, 1846-1861

The Independent Treasury: Origins, Rationale, and Record, 1846-1861

The historical consensus has long ascribed the authorship of the independent federal treasury to President Martin Van Buren, or implicitly to his advisers, although a few historians have maintained that the idea originated within the Jackson administration. Certainly Van Buren deserves credit, as Jackson does not, for proposing its adoption, which he did in his special message to Congress, in September 1837. The real author was William M. Gouge, a Philadelphia newspaper editor and political economist specializing in monetary and banking theory. In addition, his friend and fellow Philadelphian Condy Raguet deserves credit for helping him defend and spread the idea. Thus, ironically, Philadelphia was the home not only of the first two federal banks, but it was the home of the two libertarian political economists who introduced the independent treasury idea into the public consciousness, defended it with theoretical rigor, and created public pressure for its enactment. Only later did classical liberal Democratic politicians like Martin Van Buren and Thomas Hart Benton decide to embrace it.

This paper was presented at the 2002 Austrian Scholars Conference, at the Mises Institute in Auburn, Alabama.

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