But still, even in those busy times of international controversy, when the lurid light of the French Revolution outshone all others, and when men's minds were full of those ghosts of '76, which took the shape of British aggressions, and could not be laid by any charm known to diplomacy,--even in those times, busy about other things, there had been premonitions of the unequal contest between state and federal authorities. The purchase of Louisiana had given new form and startling significance to the assertion of national sovereignty, the Alien and Sedition Laws had provoked the plain-spoken and emphatic protests of Kentucky and Virginia, and the Embargo had exasperated New England to threats of secession. Nor were these open assumptions of questionable prerogatives on the part of the national government the most significant or unequivocal indications of an assured increase of federal power. Hamilton, as Secretary of the Treasury, had taken care at the very beginning to set the national policy in ways which would unavoidably lead to an almost indefinite expansion of the sphere of federal legislation. Sensible of its need of guidance in those matters of financial administration which evidently demanded its immediate attention, the first Congress of the Union promptly put itself under the direction of Hamilton. "It is not a little amusing," says Mr. Lodge, "to note how eagerly Congress, which had been ably and honestly struggling with the revenue, with commerce, and with a thousand details, fettered in all things by the awkwardness inherent in a legislative body, turned for relief to the new secretary."[6] His advice was asked and taken in almost everything, and his skill as a party leader made easy many of the more difficult paths of the new government. But no sooner had the powers of that government begun to be exercised under his guidance than they began to grow. In his famous Report on Manufactures were laid the foundations of that system of protective duties which was destined to hang all the industries of the country upon the skirts of the federal power, and to make every trade and craft in the land sensitive to every wind of party that might blow at Washington; and in his equally celebrated Report in favor of the establishment of a National Bank, there was called into requisition, for the first time, that puissant doctrine of the "implied powers" of the Constitution which has ever since been the chief dynamic principle in our constitutional history. "This great doctrine, embodying the principle of liberal construction, was," in the language of Mr. Lodge, "the most formidable weapon in the armory of the Constitution; and when Hamilton grasped it he knew, and his opponents felt, that here was something capable of conferring on the federal government powers of almost any extent."[7] It served first as a sanction for the charter of the United States Bank,--an institution which was the central pillar of