Madison, as well as Jefferson, was opposed to the creation of the First Bank of the United States, which was a national bank. Alexander Hamilton, the first Secretary of the Treasury, backed the bank's creation, but Madison and Jefferson felt that the bank concentrated too much power in the hands of the federal government. In addition, they felt that the bank would hurt local banks and the interests of farmers in the South.
Furthermore, it was Madison's contention that the Congress did not have the right to charter this bank. He thought that the Congress only had powers that were explicitly enumerated, or given, in the Constitution. Hamilton contended, on the other hand, that the bank was permitted under the Constitution's implied powers—that is, that the right to charter the bank flowed from the given powers of the Congress mentioned in the Constitution and that this right was implied by the Constitution.