Chapter 6: The United States Begins Section 2: George Washington Sets the Course

I. A Strong Executive A. President Washington was dignified B. Set precedents as a leader

II. Creating a New Government A. U.S. faced many challenges 1. War debt 2. National defense 3. Census to determine representation in Congress 4. Organize new territories 5. Draft the Bill of Rights

B. Senate passed the Judiciary Act of 1789, setting up the federal courts C. Congress created executive departments D. Divisions existed between the executive and legislative branches

III. Alexander Hamilton’s Financial Plans A. Secretary of the Treasury B. Presented proposals for collecting revenue 1. Report on public credit a. Government bonds were sold during the Revolutionary War b. Hamilton proposed paying all war debts in full to restore national credit c. Many opposed Hamilton’s plan d. Compromise was reached; a new national capital would be created (the future Washington D.C.)

2. Report on the National Bank a. Hamilton proposed the establishment of a National Bank b. Owned by the federal government and private investors c. Bank would collect taxes, accept deposits of government cash, and loan money d. Bank issued paper currency

3. Interpretation of the Constitution a. Jefferson, Madison opposed Hamilton’s plan for a national bank – strict interpretation b. Hamilton justified the establishment of a national bank using the necessary and proper clause – broad interpretation c. Washington signed the bill into law creating the National Bank in 1791

4. Report on Manufactures a. Hamilton requested Congress impose protective tariffs on foreign imports b. Tariff opposed by many, including merchants, planters, and farmers c. A lower tariff was passed by Congress to raise money, not to promote manufacturing at home

IV. Political Parties Develop A. Economic policies divided the country 1. Federalists – Hamilton’s supporters 2. Republicans – Jefferson’s and Madison’s supporters B. Washington was convinced to serve another term as President