1. The Creation of Political Parties
Hamilton v Jefferson
The Creation of Political Parties

2. Washington elected President
Washington was unanimously elected as 1st President of the US (only time ever)
Inaugurated April 30, 1789 in NYC (Capitol of the US)
John Adams was his VP (VP was runner up in elections)
Washington knew his every move would set a “precedent” for the presidency

3. Washington’s new gov’t
Presidential Cabinet
What would he be called
Article 1 Section 9.8 Titles of Nobility
No title of Nobility shall be granted by the US
Mr. President
The Founders left matters up to Congress
Federal Judiciary Act of 1789
Created the Supreme Court
Washington appointed John Jay 1st Supreme Court Justice

4. Washington’s new gov’t cont.
Washington's Cabinet- advisors to the President
Secretary of War- Henry Knox (War hero along side of GW)
Secretary of State- Thomas Jefferson (France)
Secretary of Treasury- Alexander Hamilton
Attorney General- Edmund Randolph

5. The Nation’s Finances War Debts
US borrowed millions from Spain, France and Netherlands during American Revolution
Owed Private Citizens
Government issued bonds- certificates that promise payment plus interest
Why was it important t pay of debt?
Win respect of both foreign nations and own citizens
Shows that the US is responsible with money
If they paid debt, other countries would then do business with the US

6. Hamilton’s Proposal
3 Step plan to improve the nations finances to strengthen the national government:
1. Pay off all war debt
2. Raise government revenues
3. Create a national bank
Also wanted the national government to pay off the states war debts
Hamilton asked Jefferson to help to gain Southern support
In return the capital was moved to Virginia
Present Day Washington DC

7. Hamilton’s Views Creating a strong national government
Favored tariffs- a tax on imports
Purpose
Raise money for the government
Encourage growth of national business
Favored the National Bank
A safe place for Gov’t to place its money
Could make loans to business and government
Issue a common currency (paper money)

8. Hamilton’s opponents Against the National Bank
Argued that the bank would encourage an unhealthy relationship between the gov’t and wealthy business interests
Argued that since the Constitution does not give powers to create a bank, they can’t do it (Strict Interpretation)
Hamilton used the Elastic Clause
Congress has the authority to do whatever is “necessary and proper” to carry out its specific duties, such as regulation commerce

9. Political Parties Emerge
Hamilton
(Federalists)
Jefferson
(Democratic-Republicans)
Loose Interpretation of the US Constitution
Strict Interpretation of the US Constitution
Favored Tariffs
Against Tariffs
Favored Wealthy Business Owners in the North
Favored Farmers in the South
Favored the National Bank
Against the National Bank