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Hamilton's argument destroyed Jefferson's flimsy attempt for good reason particularly since the latter just threw around learned-sounding phrases with no real logic. Anyone who tried to argue logically with Hamilton was doomed to defeat and was the main reason few of his enemies attempted to refute him. Jefferson's argument was pathetically incompetent while Hamilton's was so brilliant as to stand as one of the greatest statements of the meaning of the constitution as has ever been written. Not much of a surprise since he wrote 2/3s of the Federalist papers.

Jefferson did not distinguish correctly the difference in the means and ends of government. Hamilton easily pointed out the difference and showed that the Bank was a means to an end which allowed the government to carry out the powers entrusted to it (such as national defense and governmental finance.) It is not an end in itself only a means to several ends.

His enemies finally achieved their goal and refused to recharter the Bank at the worst possible time (when financing the War of 1812 became necessary.) To their chagrin the burden of that War and the insanity which erupted within the banking system without a National Bank FORCED them to re-charter it (Madison had changed his mind and wanted re-charter but the ideological whackjobs in Congress were to blind to understand.) Little wonder that Washington sided with Hamilton's view.

Until the Civil War the federal government was tiny so your concluding remark is also false. You might note that there was NO central bank for almost 80 yrs after Jackson unwisely destroyed it. Its absence did not slow down the growth of the fed/gov at all.

Hamilton's argument in the Essay on the National Bank does not give carte blance to government expansion. Federal power was limited by express prohibitions within the constitution, confined to actions not immoral and no actions contrary to the spirit of the document.

No one (not even Jefferson) denied that there were implied powers which were legitimate. He just became a "strict constructionist" out of political expediency but that view leads to idiotic conclusions: we could have no mint since one wasn't mentioned, we could not control our borders since that is not mentioned among other things.