1. 1789 - 1800

2. Inaugurated April 30, 1789 in NYC Set precedent – act or decision that sets an example for others to follow Created departments & cabinet to help advise President Judiciary Act Supreme Court established John Jay 1 st Chief Justice

3. Reducing the Nation’s Debt During A. Revolution the gov. needed $, so gov. borrowed from foreign countries & people through bonds Bonds – certificate which promises to repay $ loaned plus interest Sec. of Treasury Alexander Hamilton ordered repayment of all national debts b4 they affected future South did not agree w/ paying back state debts Hamilton made compromise w/ South to move the capitol to District of Columbia (Washington D.C.) by 1800 Build the Economy Agriculturally & Industrially Bank of the U.S. (1791): gov. collected tax $ & gave loans to farmers & businesses Congress passed protective tariff (tax) on foreign goods brought into the country to protect local manufacturers

4. Whiskey Rebellion Hamilton created tax on all liquor made & sold in US to raise $ for Treasury Farmers hated tax b/c they had to pay $ in order to ship whiskey which was made from corn 1794 – farmers rebelled/protested in Pittsburgh Pennsylvania Tested will of new gov & that gov. could work quick in crisis

5. In 1793, French Revolution turned violent by reformers Beheaded the King & Queen & killed thousands of citizens Leaders divided on to help Washington decides on foreign policy: actions that a nation takes in relation to other countries US signed treaty w/ France during A.R. which complicated issue of remaining neutral in war b/t French & English American Leaders Divided Hamilton said treaty no longer valid & no use of violence Jefferson: wanted to follow treaty Neutrality Proclamation: US would not support or aide either side

6. Warring nations seized US trade ships Jay’s Treaty John Jay negotiated w/ Britain to pay damages if Americans paid debts to British merchants Did nothing to protect ships Washington Retires (1796) Advised against becoming involved in European affairs w/ allies

7. Most Americans did not believe in political parties Saw how factions (opposing groups within parties) worked in Britain Threat to national unity George Washington warned that parties would lead to “jealousy & false alarms” Despite warnings factions grew up around Alexander Hamilton & Thomas Jefferson

8. Hamilton Encouraged manufacturing & trade w/ growth of cities Strong federal gov. to increase commerce Believed in loose interpretation of Constitution and Bank of US was necessary Wanted close ties w/ Britain Farmers more important Small federal gov. to protect individual freedom Though national bank would give power to investors & all powers should be given to states Favored France Jefferson

9. Leaders in states were organizing support for both candidates Jefferson – Democratic Republicans Small farmers, artisans, some wealthy planters Hamilton – Federalists Merchants & manufacturers Newspapers start to take sides for candidates Can influence public opinion

10. Election of 1796 Republicans backed Jefferson 4 Pres & Aaron Burr 4 VP Federalists supported John Adams 4 Pres & Thomas Pinckney 4 VP Person w/ most electoral votes became Pres followed by VP John Adams won Presidency & Jefferson won VP Difficult b/c opposing parties

11. XYZ Affair (1798) French objected Jay’s Treaty & seized US ships Americans called for war French minister Talleyrand refused to meet w/ US diplomats so had advisors X, Y, Z meet with them Demanded $ and loan to France “Millions for defense, but not one cent for tribute” Sparked war fever in US Adams stayed neutral but built frigates (fast naval ships w/ guns)

12. Federalists Split Disagreement over war caused split Hamilton: Hoped war would weaken Republicans Built military Wanted war verse French Adams Federalist who did not want war against the French Advisors made agreement with French to stop seizing ships

13. Alien & Sedition Acts Alien Act: Pres could expel any alien or foreigner thought to be dangerous to US & made immigrants live in US for 14 years b4 becoming citizen Made Republicans mad b/c immigrants couldn’t vote 4 them Sedition Act: citizens could be fined or jailed for criticizing gov. or stirring up a rebellion Republicans said this violated 1 st amendment

14. Jefferson opposed acts & asked states to nullify (cancel) the laws passed by fed. Gov Kentucky & Virginia Resolutions Each state has right to judge whether laws is constitutional, and if un, can nullify Raised issue of states’ rights – strong or loose interpretation of the Constitution? Alien & Sedition acts would change or drop later on

15. Election of 1800 Republicans attacked Federalists 4 raising taxes to prepare for war & Alien & Sedition acts Jefferson (Rep. Pres) & Burr (Rep. VP) tied in electoral votes Rule said vote decided by House of Reps After 4 days, decided on Jefferson as President Influenced 12 th Amendment (1804) – Electors would vote for Pres & VP separately Federalist party started to decline