Launching the New Ship of State

1. Launching the New Ship of State The Federalist Era 1789-1800

2. America Circa 1790 • Roughly 4 million people • Doubling every 25 years • 90% rural • 95% east of Allegheny Mts. • Precarious finances

3. Domestic Policy Issues

4. George WashingtonThe President of Precedents

5. Washington Administration

6. Unanimously elected the first president under the new Constitution • Served from 1789 - 1797

7. John Adams – Vice President • New federal government first established in New York City • later moved to Philadelphia in 1790

8. Congress created the executive branch departments of… • State • Treasury • War • Postmaster General.

9. The Cabinet: • Washington sets precedent of consulting the department heads in order to make decisions • Part of “unwritten constitution”

10. Thomas Jefferson appointed as the first Secretary of State

11. Alexander Hamilton was Secretary of the Treasury

12. Henry Knox became the first Secretary of War

13. Judiciary Act of 1789 • Supreme Court created by the Constitution • A Chief Justice • 5 Associate Justices

14. Washington appointed John Jay to be the first Chief Justice

15. Judiciary Act expanded the Judicial Branch by creating • federal district courts • circuit court of appeals

16. Act also created the office of Attorney General • Edmund Randolph

17. The Bill of Rights • James Madison drafted the first amendments & sent them to Congress

18. The first ten amendments adopted in 1791

19. The Bill of Rights • 1st – freedom of speech, press, assembly, petition, & religion • 2nd – right to bear arms • 3rd – forbade quartering troops • 4th – forbade unreasonable searches & seizures

20. 5th – rights during trial & life, liberty, property • 6th – right to fair & speedy trial • 7th – right to trial in civil cases • 8th – forbade excessive fines & unusual punishments

21. 9th Amendment: • Certain rights “shall not be construed to deny or disparage others retained by the people” • People retain rights not enumerated here

22. 10th Amendment • so-called “state’s rights amendment” • all rights not explicitly delegated or prohibited were reserved to the states or the people

23. Hamilton’s Financial Plan • Hamilton:“Father of National Debt” • “Funding at par” • “Report on Public Credit” • Rev. War debt certificates paid at full face value (“at par”) • Purpose: bolster national credit

24. Assumption of State Debts • “Report on Manufactures” • Would tie states & creditors to federal government • North-South struggle ensued • Massachusetts – large debt • Virginia – small debt

25. Compromise reached • South agreed to assume the debt if North agreed to allow the new Capital to be built in the South • “log rolling”

26. Washington, D.C. would be built on the Potomac River on land donated by Maryland and Virginia

27. Tariffs (customs duties) • Revenue Act of 1789 • 8% tariff on imports • Also attempt at helping infant American industries • Whiskey Excise Tax (1791)

28. The B.U.S.

29. National Bank • Foundation of Hamilton’s plan • Private institution in which the government held a majority interest

30. Government deposited its surplus money in the bank • Deposits would then be the source of loans & allow for the printing of a national currency

31. Bank issue sparks public Hamilton-Jefferson debates • Jefferson argued that the bank would favor northern bankers over the western & southern farmers

32. “Strict Construction” • Jefferson also argued that the Constitution said nothing about creating a bank & therefore it was unconstitutional

33. “Loose Construction” • Hamilton argued that the bank was “necessary & proper” and permitted by the elastic clause • Gave Congress “implied powers”

34. Hamilton won over Washington • The Bank of the United States was founded in 1791 & chartered for twenty years • More N-S friction!

35. HAMILTON'S FINANCIAL PLAN • Pay off $80 million debt • Excise tax:Taxes placed on manufactured products • Tariff: a tax on imports • Establish good credit with foreign nations • Create a national bank with a national currency • Raise money for gov’t backed by gold silver • Assumption Act passed as a compromise with Thomas Jefferson placing the US Capital in the South (Virginia) Foreign Debt $11,710,000 Federal Domestic Debt $42,414,000 State Debt $21,500,000 Misc.Revenue ExciseTaxon Whiskey CustomDuties(Tariffs)

36. BANK OF THE U.S. BUS • HAMILTON • Safe place to deposit and transfer money • Provide loans to government and state banks • A national currency---$$$$$ • An investment by people to buy stock into US bank • Constitution did not forbid a national bank….Loose construction of Constitution • National debt good for country • JEFFERSON • Went against the Constitution • State banks would collapse • Only wealthy could invest in bank and would control bank than control the government • Hurt the common man • Strict construction…If it is not mentioned in the Constitution than there can’t be a national bank • Against a national debt

37. Whiskey Rebellion (1794) • SW Pennsylvania farmers hated Hamilton’s whiskey tax • “Liberty and No Excise” • Major challenge to new national government

38. Whuppin’ Revenooers

39. Washington summoned the militia of several states to put down the insurrection • “Rebels” were dispersed without bloodshed

40. President Washington reviews 13,000 troops of the Western Army assembled at Fort Cumberland, Maryland, to crush the Whiskey Rebellion.

41. Swift & decisive action of President gave the new government badly needed respect • Federal Government could ensure domestic tranquility!

42. Emergence of Political Parties • Factionalism, fueled by newspaper editorials, developed into organized political parties

43. Political duels of Jefferson & Hamilton = the beginning of the political party system

44. Jefferson and Hamilton were at completely opposite poles in the political spectrum.

45. Jefferson, an Anti-Federalist, opposed a strong central government. • Hamilton, a Federalist, was suspicious of giving power to the people.

46. Jefferson was a friend of France and believed in their revolution. • Hamilton was a friend of England and wanted close ties for trade.

47. Jefferson distrusted commerce and industry, he believed in a rural population of farmers and an economy of agriculture.

48. Hamilton wanted a strong commercial economy based on trade and commerce and an urban population.

49. Federalists (1790s) • Gov’t by “best people” • Distrusted common people • Strong central government • Gov’t should encourage business • Pro-British foreign policy

50. Jeffersonians • aka Democratic-Republicans • Rule of the people (literate) • Appealed to middle class & underprivileged • Gov’t that governed best, governed least