Populism

"In all very numerous assemblies, of whatever character composed, passion never fails to wrest the scepter from reason," warned Madison in Federalist 55. "Had every Athenian citizen been a Socrates, every Athenian assembly would still have been a mob."

Compromises between the two factions helped shape the Congress we have today: a large House of Representatives whose short terms and many numbers were intended in part to prevent its domination by aristocrats, and a Senate whose smaller number and longer terms were intended to create a buffer against popular opinion.

Yet the struggle of elitists against populists did not end, cropping up in one of America's first economic crises.

Then, as now, the issue was debt. The American Revolution was financed by the states' borrowing - from abroad, from wealthy patriots, and by paying common soldiers with IOUs. Over time, as they despaired of ever being repaid - the new American government had failed to give itself the power to collect taxes - some of the holders of that government paper sold it to speculators at pennies on the dollar.

Alexander Hamilton, the first secretary of the Treasury, called that debt the "price of liberty" and proposed that the federal government pay it off at face value, a potentially enormous windfall for speculators (whom Thomas Jefferson dubbed Hamilton's "mercenaries") who