Hamilton's Improvisation

Alexander Hamilton faced a political impasse that threatened not only the new administration but the existence of the nation itself. After the economic panics and political scares of the mid-1780s, national leaders met to address the national challenges. The result was the Constitution that, after a fierce ratification battle swayed by Hamilton’s Federalist Papers, established “a new order of the ages.” George Washington, the first president of the United States, appointed Hamilton Treasury Secretary and assigned him the challenge of resolving the new nation’s acute financial crisis. Heavily in debt and without resources to run the government, let alone meet its obligations, the national and state economies were on the brink of collapse.

Without a strong domestic manufacturing base and a vibrant economy, the United States seemed doomed to collapse under the weight of debts from the Revolutionary War and the disparate systems of trade and taxation between each state and other countries. What’s more, two opposing political cultures had emerged. One distrusted government and championed states-rights and minimal national intervention; the other believed in a strong federal government, decisive leadership and limited national intervention; both espoused fiscally conservative policy.

Hamilton’s Improvisation emerged from this political and economic environment. Improvisation, defined by Jeffery Yip, is the “unique practice that derives its energy in working through uncertain situations.” It is the ability “to act and learn through paradox,” or two contradictory behaviors. Improvisation, a necessary element to resolving the tensions of paradox, is an important leadership skill.

Hamilton, who was from New York, proposed a solution at a dinner attended by his chief opponent, James Madison, and hosted by Thomas Jefferson, both Virginians. The proposal called for the Federal Government to assume all state and national debts and to fund the payment of the debts through modest import taxes. As a part of the deal, the national capital—another point of vehement disagreement between the two rival factions—was to be located for 10 years in the northern location of Philadelphia and then permanently fixed in the South on the border between Maryland and Virginia. Because Hamilton was willing to yield on the location for the capital, Madison was willing to yield on how to pay off the national debt. Even in conflict, Hamilton was able to improvise a solution based on harmonizing the disparate political issues and positions.

Yip explains that anticipation, harmonization, and experimentation are key elements of improvisation, just like in jazz music. Hamilton anticipated the critical issues, was willing to blend the issues together, and attempt solutions that had never been proposed before.

To relieve the tensions of paradox try these three things: Anticipate, harmonize, and experiment. When you do, the science of leadership becomes the art of leadership. It worked for Hamilton; it will for today’s leaders, too.