The New Republic 1789-1816

Objectives Describe the steps Washington’s administration took to build the federal government. Analyze Hamilton’s plans for the economy and the opposition to them. Explain how a two-party system emerged in the new nation.

Terms and People administration – the officials in the executive branch of government precedent – an act or statement that becomes a tradition to be followed Cabinet – the officials who head the major executive departments and advise the President tariff – a tax on imported goods loose construction – a broad interpretation of the Constitution relying on the implied powers of Congress

Terms and People (continued) strict construction – a narrow interpretation of the Constitution that limits Congress’s actions only to powers specifically granted by the Constitution Whiskey Rebellion – a 1794 protest by farmers in western Pennsylvania against an excise tax on whiskey political party – a group that seeks to win elections, hold public office and shape policy Democratic Republicans – a political party that emerged in opposition Hamilton’s economic policies

Demographics of the new nation First census- 1790 4 million people Cities growing- Philadelphia, New York, Boston, Charleston, and Baltimore 90% rural 95% lived east of the Appalachians Within fourteen years, Vermont, Kentucky, Tennessee, and Ohio all added as states

Calls during the ratification process for greater guarantees of rights resulted in the addition of a Bill of Rights in 1791 The Bill of Rights consists of the first 10 amendments to the Constitution

The Bill of Rights Amendment I- Freedom of religion, speech, press, assembly, and petition Amendment II- The right to bear arms Amendment III- No quartering of soldiers in private homes Amendment IV- Protection from unreasonable searches and seizures Amendment V- Guarantees due process of law; the right to remain silent; no double jeopardy

Amendment VI- The right to a fair and speedy public trial in a criminal case Amendment VII- The right to a trial by jury in a civil case Amendment VIII- No excessive bail or cruel and unusual punishment Amendment IX- People have rights not mentioned in the Constitution Amendment X- Powers not mention in the Constitution belong to the states or the people

How did debate over the role of government lead to the formation of political parties? In 1789, the leaders of the new government gathered in New York City. The newly ratified Constitution was entirely untested. The Framers and President Washington knew that a good start was essential to the future of the republic.

Election of Washington Unanimously chosen by the Electoral College in 1789 Only presidential nominee to be chosen unanimously Took oath of office on April 30, 1789 in NYC

The new President faced many challenges: The nation was $52 million in debt. There was no navy and the army had only 400 men. Spain closed the Mississippi River in New Orleans to American trade. British troops occupied American land along the Great Lakes. When George Washington took office, he quickly established precedents for running the government. The new President faced many challenges:

Washington picked a Cabinet to head each of four executive departments in his administration. Secretary of State Thomas Jefferson Secretary of War Henry Knox Secretary of Treasury Alexander Hamilton Attorney General Edmund Randolph

Cabinet – the officials who head the major executive departments and advise the President administration – the officials in the executive branch of government

Washington Jefferson Hamilton Knox Randolph

President Obama’s Cabinet http://www.whitehouse.gov/administration/cabinet Loretta Lynch- first African American female nominated to be Attorney General

The first task was to set up a court system. The Judiciary Act of 1789 created district and circuit courts and a six- member Supreme Court. The office of Attorney General was created to prosecute legal cases for the government. John Jay was appointed as first Chief Justice of the Supreme Court.

The huge debt was the biggest problem facing the administration The huge debt was the biggest problem facing the administration. Treasury Secretary Hamilton suggested a controversial plan. Rather than just pay off the federal debt, state debts would also be assumed. Bonds for the total would be sold to wealthy investors. The investors would receive annual dividends and have a stake in helping the government succeed.

Hamilton’s Financial Plan “Funding at par” Federal government would pay off its debts at face value- more than $54 million (people had been losing faith that the new government would be able to meet its obligations and the value of government bonds had depreciated to 10-15 cents on the dollar) “Assumption” Federal government would assume state debts. This would tie the states more to the fed. gov’t. The loyalty of wealthy creditors would shift from the states to the federal government.

Hamilton also proposed chartering a Bank of the United States to regulate state banks and insure business support. He hoped to replace the nation’s agriculturally based economy with commerce and manufacturing. He proposed a high tariff or tax on imported goods to earn revenue and encourage domestic industry.

Figure 10.1 Hamilton’s Financial Structure Supported by Revenues Figure 10-1 p184

1 2 3 Hamilton saw 3 advantages to his financial plan The plan would establish the nation’s financial credibility. 1 The plan would gain political support from the wealthiest Americans. 2 3 The plan would enrich investors who would reinvest and thus create more wealth.

Debt as a national blessing? If the government owes people money, those people have a stake in the success of that government

1 Wealth would be redistributed from farmers to merchants, and from the South to the North. Investors who purchased the bonds would make huge profits at everyone else’s expense. The costs would fall on farmers who would have to pay excise taxes and higher tariffs. Antifederalists objected to Hamilton’s plan. They had 3 main complaints: 2 3

Secretary of State Jefferson opposed Hamilton’s plan. Most southern states had already paid off their war debts. He asked why they should bail out northern states that still had debts. Jefferson believed the plan gave more power to the government than the Constitution permits.

Jefferson favored a strict construction of the Constitution. Congress should be limited to the powers specifically granted by the Constitution. The Constitution does not give Congress power to charter a national bank, so it could not establish one Hamilton favored a loose construction of the Constitution. Congress has implied powers, and can take any actions not specifically forbidden. The Constitution allows Congress to act for the “general welfare” so it could charter a bank.

The Bargain 1790 Hamilton convinced Jefferson to support the plan for assumption in return for the new federal district (D.C.) to be located on the Potomac Virginia did not have a lot of state debt but would gain commerce and prestige from the location of D.C.

In 1791, Congress accepted Hamilton’s plan. The national debt was funded, outstanding state debts were assumed, excise taxes and tariffs were levied, and the bank was authorized. In return, a new national capital was created. Washington D.C. would be placed in the South, on the banks of the Potomac River.

L’Enfant’s Plan for the District of Columbia

Washington, D.C. Today

White House Construction

An excise tax on whiskey led to divisions between the Federalists and the Antifederalists. To increase their profits, western Pennsylvania farmers made whiskey from their grain. The whiskey tax reminded farmers of British taxes. In 1794, some farmers resisted payment. They harassed and intimidated tax collectors.

Whiskey Rebellion 1794, southwestern Pennsylvania Distillers used arguments and symbols of the Revolution Washington called for militias from the states. 13,000 troops responded. Whiskey Rebellion faded. Government was strengthened Whiskey poles instead of Liberty poles “Liberty and No Excise”

The Whiskey Boys The cartoonist clearly favored the Pennsylvania rebels who resisted Hamilton’s imposition of an excise tax on whiskey. p185

Hamilton persuaded Washington to suppress the Whiskey Rebellion. Twelve thousand militiamen were sent to deal with the rebellion, but they found no organized insurrection. Then Jefferson criticized Hamilton for the use of federal force to repress legitimate criticism. Hamilton persuaded Washington to suppress the Whiskey Rebellion.

Despite Washington’s disapproval, two political parties emerged. Democratic Republicans Favored Jefferson and Madison. This party was strongest among Southerners and farmers. Federalists Favored Hamilton and was strongest among Northerners, merchants, and the wealthy.

The Emergence of Political Parties Organized opposition to Hamilton’s revenue-raising and centralizing policies began to build Previously, factions (Whigs/Tories, Feds/Anti-Feds) had existed as opposed to organized political parties Beginning of America’s two-party system The party out of power (“the loyal opposition”) acts as a check on the party in power

Table 10-2 p186

Political Opinion Poll

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