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evaluated status of Revolutionary debt - million in US debt, million owed to Americans, rest to foreign nations. States had debts of million. Proposed that fed. gov. fund the debt (raising money through new securities, interest), fed. gov. fund state debts (states didn't pay back money, US loses credit). Raising money : tariffs, selling federal lands, import taxes, whiskey tax. Debt to American citizens should be permanent. People objected that those who didn't deserve money would get it, no compensation for those who had sold their certificates. All states but MA, NC, and CA had paid their creditors, South had paid most of debt : rewarded irresponsibility. Relocated capital to South, assumption passed, reversed nation's fiscal standing.