To the triumph of popular government and of the proposition that sovereignty rightly belongs to the mass of ordinary individual and equal citizens.

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To the triumph of popular government and of the
proposition that sovereignty rightly belongs to
the mass of ordinary individual and equal
citizens.

• The Federalist Era and the Launching of a New
  State

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(No Transcript)
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• The preservation of the sacred fire of liberty,
  and the destiny of the Republican model of
  Government, are justly considered as deeply,
  perhaps as finally staked, on the experiment
  entrusted to the hands of the American people.

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Commanded his followers by strength of character
rather than by the arts of the politician.
George Washington
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he may require the opinion of the principle
officer in each of the executive departments
The Cabinet
Henry Knox Secretary of War
Alexander Hamilton Secretary of Treasury
Thomas Jefferson Secretary of State
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The most insignificant office that ever the
invention of man contrived or that his
imagination conceived.

• Vice President John Adams

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The Judiciary Act of 1789
John Jay 1st Chief Justice
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We have a continent bountiful in vast resources,
but governments that are handcuffed by DEBT.
What road should our ECONOMY take?

• Assumption urged Congress to take on all of the
  States debts
• 54 million
• Problems
• Southern States had already paid off war debts
• Wealthy merchants of North had bought the govt
  bonds from poor farmers at cheap price and would
  now make huge profits

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He outlined his plans in three groundbreaking
reports to Congress on public credit (January
1790), on a national bank (December 1790), and on
manufactures (December 1791).
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Hamilton called on Congress to pay at face value
the millions of dollars in securities issued by
the Confederation government. He reasoned that,
as an underdeveloped nation, the United States
was heavily dependent on foreign loans and needed
good credit to survive.
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Hamilton proposed that the national government
improve the public credit by assuming the war
debts of the states. This plan would favor
wealthy creditors. It unleashed a flurry of
speculation and government corruption.
findingthefounders.com
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In December 1790, Hamilton issued a second
report, which asked Congress to charter the Bank
of the United States. The bank would be jointly
owned by private stockholders and the national
government.
How will the Government keep track of paying this
new debt and organize our currency?
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Hamilton argued that the bank, by making loans to
merchants, handling government funds, and issuing
bills of credit, would provide financial
stability and a respected currency for the
specie-starved American economy.
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These potential benefits persuaded Congress to
charter Hamiltons bank, for a period of twenty
years, and send the legislation to the president
for approval.
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At this critical juncture, Secretary of State
Thomas Jefferson joined the ranks with James
Madison against Hamiltons financial initiatives.
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The incorporation of a Bank, Jefferson told
President Washington, was not a power expressly
delegated to the United States by the
Constitution. Jeffersons argument rested on a
strict interpretation (Expressed Powers) of the
national charter.
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In response, Hamilton devised a loose
interpretation of the Constitution, stating that
Article I, Section 8, empowered Congress to make
all Laws which shall be necessary and proper to
carry out the provisions of the Constitution.
(Implied Powers)
Elastic Clause
www.fanpop.com
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Agreeing with his treasury secretary, Washington
signed the legislation.
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Where was the money to come from to pay off this
new DEBT?

• Tariff tax on imports
• Revenue income govt collects for public use
• Designed to erect a protective wall around
  growing industry
• Excise Tax internal tax levied on manufacture,
  sale, or consumption of commodities within a
  country

- encourage the spirit of enterprise, innovation,
and invention within the nation - support the
building of roads and canals to encourage
internal trade - grow the infant United States
into a manufacturing power independent of control
by foreign powers through reliance on their goods
for domestic and especially defense supplies.
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Although he urged the nation to become
self-sufficient in manufacturing, Hamilton did
not support high protective tariffs that would
exclude competing foreign products.
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Instead, he advocated revenue tariffs that would
pay the interest on the debt and defray the
expenses of the national government.
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Hamiltons scheme worked brilliantly. As American
trade increased, customs revenue rose steadily.
Tariffs also had the unexpected effect of
encouraging rapid settlement of the West, an
outcome opposed by Hamilton and favored by his
political opponents.
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As treasury secretary, Hamilton devised bold
policies to enhance national authority and to
favor wealthy financiers and merchants.
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The Peoples Reaction

• Whiskey Rebellion of 1794
• Western Pennsylvania farmers refused to pay tax
  on Whiskey that would lead them to bankruptcy
• Attacked revenue collectors protecting their
  liberties
• George Washington responds by sending in 15000
  militiamen
• Rebellion collapsed with no bloodshed
• POV - Some saw this as proof of strength of the
  national govt, others saw it as an unwarranted
  use of force

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• Trickle Down Theory Favor the wealthier groups
  in the economy who as they prosper, prosperity
  will trickle down to the masses ( the powerful
  would then support the govt.)

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Foreign Policy

• French Revolution explodes in Europe, Who should
  we support?
• Proclamation of Neutrality 1793
• Washington believed the young nation was not
  strong enough to engage in a European war
• Jay Treaty 1794 Treaty with Great Britain
• Evacuate British troops from NW
• GB would pay damages from stolen ships
• America would pay pre-war debt

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Native Americans

• Battle of Fallen Timbers 1794
• General Anthony Wayne defeated the Native
  Americans (Shawnee, Wyandot, etc.)
• Treaty of Greenville surrendered the Ohio
  Territory and promised to open it up to settlement

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George Washington was more than willing to answer
the call to become the first president, but was
unsure he was fit to launch this new state
successfully. Others were not as doubtful as
shown in the unanimous vote to elect Washington.
Why was Washington the unanimous selection for
president?
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• Washington was the hero of the Revolutionary War
  who led our troops and nation to victory from the
  oppressive British government. He also presided
  over the Constitutional Convention in
  Philadelphia as our fledgling government
  attempted to repair itself.