Washington and Congress

Chapter 6 Section 1

Creating a New Government A new Constitution had been created,

now it was Washington’s task to create an effect gov’t for the U.S.

Institution of Powers 1st task provide the pres. with a bureaucracy

to handle different responsibilities▪ 1789=created Dept. of State, Treasury, and War,

and Office of Attorney General To manage these Washington wanted people

who were “disposed to measure matters on a Continental Scale”

Creating a New Government

▪ Secretary of State= Thomas Jefferson▪ Treasury Department=Alexander Hamilton▪ Secretary of War=Gen. Henry Knox▪ Attorney General=Edmund Randolph▪ Became known as the president’s cabinet

Congress also created the Judicial Branch▪ Judiciary Act of 1789=13 district courts, 3

courts of appeal, and the Supreme Court▪ Washington chose the federal judges w/ Senate’s

consent John Jay=1st chief justice of U.S.

Thomas Jefferson

Alexander Hamilton

Henry Knox

Edmund Randolph

Creating a New Government

Bill of Rights One of most important acts of Congress

was the introduction of the Bill of Rights▪ Drafting of Bill of Rights= took from Virginia

Declaration of Rights (George Mason) and the Virginia Statute of Religious Freedom (Thomas Jefferson)

In late Sept. 1789, Congress agreed on 12 amendments▪ Only 10 were approved=by states ratification

Bill of Rights

George Mason

Thomas Jefferson

Financing the Government By the end of 1789, new federal gov’t

was running Gov’t now needed a source of revenue▪ James Madison and Alexander Hamilton both

provided plans for financing gov’t The Tariff of 1789

James Madison suggested raising money by taxing imports from other countries▪ Congress passed Tariff of 1789▪ Importers had to pay % of the value of their cargo▪ Shippers also had to pay tonnage=tax based on how

much their ships carried

The Tariff of 1789

James Madison

Financing the Government

Upset southerners=high tonnage rates on rice and tobacco Suspected the new gov’t opposed their regions

interests

Hamilton’s Financial Program Believed gov’t needed the ability to

borrow money▪ 1790- asked Congress to accept full debt of the

Continental Congress▪ Owed $40 million to American citizens=purchased

through bonds▪ Owed $11.7 million to France, Spain, and the

Netherlands

Bonds

Financing the Government

▪ Hamilton believed if U.S. accepted debts in full value then wealthy creditors, bankers, and merchants who owned bonds would have a stake in the new gov’ts success ▪ They would loan them money in the future

Opposition to Hamilton’s Plan Led by Madison▪ Madison felt it was unfair to original

purchasers of bonds▪ Sold for discounted rates to speculators ▪ Some paid as little as $10 for $100 bond

They would receive full price from gov’t

Financing the Government

▪ Was also opposed by Southerner b/c most Northerners owned most of the bonds▪ Most of tax used to pay for bonds would come from the

South

▪ Madison also worried creditors would dominate American society and endanger liberty

In July 1790, Hamilton, Madison, and Jefferson struck a deal▪ Madison and Jefferson influenced Southerners to

vote for Hamilton’s Plan▪ In return, the capital was moved to a section of

land off the Potomac, District of Columbia▪ Placed capital in the south=pleased Southerners

Financing the Government The Bank of the United States

Hamilton asked Congress to created a national bank▪ Arguments for the bank:▪ Gov’t needed it to manage its debt and interest payments▪ Needed to issue paper money=national currency

Would promote trade, encourage investment, and stimulate economic growth

Southerners opposed the plan▪ Place the stock in hands of Northern merchants▪ Madison stated Congress couldn't establish a bank▪ Wasn’t a enumerated power of the gov’t

First National Bank U.S.

First National Bank U.S.

Financing the Government

Congress passed the bank bill▪ Att. Gen. Randolph and Sec. of State Jefferson

argued that Constitution didn’t give the gov’t power to create a bank▪ Put Washington in a tough spot

▪ Hamilton disagreed, pointed out Article 1 Section 8= “necessary and proper” clause▪ Created implied powers

In 1791, the Bank of the United States was established

Implied Powers

Financing the Government Whiskey Rebellion

In 1791, Congress imposed a tax on whiskey▪ Urged on by Alexander Hamilton▪ Whiskey was used a medium for exchange in

western regions of U.S. In summer of 1794, rebellion erupted in PA▪ Farmers terrorized tax collectors, stopped court

proceedings, robbed the mail, and destroyed the whiskey-making stills of those who paid the tax▪ In August 1794, George Washington sent nearly 15,000

troops to crush the Whiskey Rebellion

The Rise of Political Parties

FEDERALISTS

Supporters of Alexander Hamilton and his financial program

Favored strong federal gov’t

Believed manufacturing and trade were basis of national power and wealth

Supporters: artisans, merchants, manufacturers, bankers, urban workers, and Eastern farmers who benefitted from trade

DEMOCRATIC-REPUBLICANS

Hamilton’s opponents, led by James Madison and Thomas Jefferson

Believed strength of the U.S. was its independent farmers (agrarianism)

Feared too much emphasis on commerce= a divide in society=rich vs. poor

Believed wealthy would corrupt gov’t

Supported agriculture over commerce and trade

Federalists

Democratic-Republicans

The Rise of Political Parties

Development of 1st two political parties divided the country Rural south and west=Republicans Urban northeast=Federalists▪ Problems in Europe would cause more

problems between the two and create new crises for the U.S.