By Nancy Spannaus
First Entrepreneur: How George Washington Built His—and the Nation’s—Prosperity
Edward G. Lengel
Da Capo Press, Boston, 2016, 280 pp.
February 2017–As director of the Washington Papers documentary editing project at the University of Virginia, author Edward G. Lengel has been working for 20 years on the extensive archive of letters and papers by the United States’ first President. From his study of this treasure trove, Lengel, initially a military historian, has produced an enlightening book about George Washington which stresses the first President’s views on how economic development can and must serve to produce foreign and domestic peace and prosperity.
The key concept was Washington’s insistence on economic policies—from agriculture, to commerce and manufacturing—that would create “an indissoluble community of Interest as one Nation” within the United States, and the basis for international peace by mutually beneficial commercial relations between nations. Thus, it was the pursuit of economic prosperity, Washington believed, that would bind the various states of the United States together, and also create bonds between nations so as to avoid war.
In fact, Washington’s life is an example of the integration of a career as businessman, military man, and political leader, in an almost seamless fashion. Washington never stopped thinking of himself first as a businessman/developer, and his approach to developing the economic potential of the nation informed everything he did.
Economics Comes First
Lengel lays the basis for developing Washington’s policy as President by first examining his approach to his personal economic livelihood, and the role his view of economic policy played in his military career. He argues that the basis for Washington’s support for independence was his determination to break free of British economic control, expressed through the chains of debt which British policy on the tobacco trade imposed on Southern producers. By 1764, Washington had had enough; it was in that year that he began a changeover of Mount Vernon from a tobacco plantation to a wheat-growing enterprise, and ultimately, a small industrial enterprise. Producing wheat and flour permitted a farmer to escape dealing with British merchants directly, and the debt trap which their “company store” practices created.
By the time of the 1774 Fairfax Resolves, the flourishing businessman had expanded this view to the nation, as a whole. He was the author of the 14th and 15th Resolves, which expressed a vision of the economic future of the country. The 14th Resolve asserted “that it is the indispensable Duty of all the Gentlemen and Men of Fortune to set Examples of Temperance, Fortitude, Frugality and Industry; and give every Encouragement in their Power, particularly by Subscriptions and Premiums, to the Improvement of Arts and Manufactures in America.”
This economic outlook permeated Washington’s approach to the military conflict with Great Britain as well, Lengel asserts. The General at first hoped that economic measures, such as embargoes, could bring the British to heel, but once the shooting war began, he was forever attentive to the way in which the conduct of the war was affecting the population, and the prospects for peace once the war ended. “Winning the war… could not come at the price of losing the peace that followed,” he argued, and he carried through that conviction by a consistent opposition to any plundering of the population, and even confiscation of necessities, unless it was accompanied by recompense. Winning the peace also involved developing economic ties for the former enemy, to create stability for both nations.
Binding Together and Preserving the Nation
Washington’s hopes for the nation, once the victory had been achieved, were eloquently expressed in a circular letter he addressed to the governors of the states on June 8, 1783. Lengel describes this letter as a “great public legacy,” and cites the four principles which Washington outlined therein: a government “under one Federal Head,” a “Sacred regard to Public Justice,” a military “Peace Establishment,” and a spirit of national unity in which individuals would “make those mutual concessions which are requisite to the general prosperity.” The alternative, he asserted, would mean that it would be impossible for business and commerce to thrive; the nation would dissolve, and the sacrifices would have been in vain.
Five years later, when Washington was persuaded to leave his beloved farm and assume the Presidency, he assiduously pursued these principles. In a letter to William Barton dated Sept. 7, 1788, he summarized his approach to that office as “promoting & rendering permanent the national prosperity.” “This, he declared,” should be my great—my only aim.”
Washington did his best to accomplish this aim through both the economic policies he pursued (in close collaboration with his Treasury Secretary and friend Alexander Hamilton), and his foreign policy. His economic policy involved binding the nation together through the assumption of the war debt, the creation of a national bank, and the establishment of public credit through responsible debt payment and raising of the national revenue—creating a “community of interest.” Such a financial infrastructure would create the conditions for industry and commerce to thrive, without overbearing government intervention. His foreign policy meant avoiding being trapped into the snares of the conflicts among the European nations, and attempting to build increasingly positive relations through mutually beneficial commerce. To do this, Washington directed the negotiation of three crucial treaties: the Jay Treaty with Great Britain, the treaty with Algiers, and the treaty with Spain. All these were accomplished in 1795. Although less discussed than the others, the Spanish treaty was particularly important, since it opened up U.S. navigation rights on the Mississippi, thus eliminating a major grievance felt by the Western states, and setting the stage for later continental expansion.
Without George Washington’s albeit limited success in both his domestic and foreign policies, it is doubtful that the United States would have survived its early years. As the nation’s preeminent individual, he had a moral authority which permitted him to set a standard for all citizens, and to weather even the most virulent opposition. Above all, he conveyed to them a commitment to national unity, prosperity built on virtue and morality, and peace. Acutely aware that he was constantly in the public eye, he lived those values and promoted them with increasing effectiveness.
There are times when Lengel’s treatment of Washington’s abhorrence of debt and pursuit of “money” could be misread as saying that he saw them as ends in themselves, rather than in the context of his overall objectives. But on the whole, Lengel has provided a very valuable book on a dimension of George Washington that is often overlooked: the way that the commitment to the economic development and innovation by our nation’s preeminent Founding Father helped us win the war, and build the United States into the world’s greatest economy.
Nancy Spannaus is the editor of the Political Economy of the American Revolution, and the former editor-in-chief of Executive Intelligence Review and the New Federalist.