1. Democracy in Distress: The Violence of Party Politics 1788- 1800 Chapter 10

2. Launching the New Ship of State George Washington – The First President Unanimously voted in by the electoral college For many Americans, Washington was a symbol of the new republic. Considered his role to personally demonstrate the existence of a strong republic. According to the first census in 1790, the population in the U.S. was about 3.9 million.

3. Creating the Court System The constitution called for three, separate but equal branches of government, but only officially established the executive and legislative branches. The Judiciary Act of 1789 Officially created the federal court system in the United States.

4. Other Important Government Officials Washington’s Cabinet 1.Thomas Jefferson – Secretary of State (foreign and domestic affairs) 2.Alexander Hamilton – Secretary of Treasury (economic affairs) 3.Henry Knox – Secretary of War (military affairs) John Adams - Vice President. John Jay – first Supreme Court Chief Justice

5. Hamilton’s Economic Theory 1.The government should support industrial and commercial development (build American businesses) 2.For the new government to survive, it had to have the support of the wealthiest citizens If the wealthiest Americans had a vested interest in the Government, they would work hard to see it succeed. 3.A National bank was necessary for the country’s economic health. 4.The development of cities was key to the nation’s success 5.Reestablish trade with Britain – the largest economy in the world.

6. The Financial Crisis The financial crisis in American was the greatest challenge during Washington’s presidency. It was Hamilton’s job to try to overcome the crisis. Hamilton wrote A Report on Public Credit where he outlined what the country needed to do to escape financial ruin. 1.Federal gov’t would assume state debts in full (assumption) 2.A tariff (tax on imported goods) 3.An excise tax on whiskey 4.Form a National Bank

7. Assumption Under Hamilton’s plan, the federal government would assume, or pay off, all state debt that was accrued during the Revolution. The government would take loans from the wealthy to pay off state debt. Creating a larger public debt in which the wealthiest Americans were the big investors, would ensure that those people would work hard towards the success of the republic. This plan was vehemently opposed by Jefferson and Madison because they thought it favored only a select few.

8. Criticism of the Assumption Policy States that had massive Revolutionary War debt, and had yet to pay their debt off, loved the plan. Massachusetts and many of the Northern states States that had paid their debts following the war, hated the plan and felt like they were being punished for doing the right thing. Virginia and many of the Southern state To appease the Virginians into accepting the assumption policy, Hamilton negotiated that the new Federal Capitol would be placed within the northern border of Virginia – The District of Columbia.

9. Tariffs and Excise Taxes The Report on Manufacturers by Alexander Hamilton Suggested implementing protective tariffs 1.Establish a safety hedge for American manufacturing to protect from cheaper European goods flooding the market and driving prices down. 2.To provide a source of income for the Federal Government. Hamilton was not able to secure the passage of the protective tariff that he designed.

10. The National Bank The Bank of the United States A private organization (unlike today’s Federal Reserve) Purposes: To provide stability to the United States economy To serve as a depository for the Federal Governments revenue To provide credit to American businesses Again, Jefferson and Madison fiercely opposed the formation of a strong centralized bank Argued that centralized financial institutions in Britain led to widespread corruption.

11. Jefferson vs. Hamilton By the end of Washington’s first term in office, the political squabbling between Hamilton and Jefferson threatened to divide the government. Hamilton and Jefferson developed a bitter rivalry with each other. The two party system was created because of the Jefferson-Hamilton feud. Jefferson disagreed with Hamilton and the Federalist party so much that he formed his own party called the Democratic- Republicans.

12. Washington’s Second Term During Washington's second term in office, foreign affairs replaced the financial crisis as the most pressing issue for the administration. War broke out in Europe between France and Britain: 1.Britain tried to economically coerce America into supporting them 2.France thought we would support them because of our Revolutionary War alliance.

13. Decisions for the Administration Thomas Jefferson – wanted Washington to pledge support to the French for diplomatic reasons. Alexander Hamilton – wanted Washington to pledge support to Britain for economic reasons. Washington’s Neutrality Proclamation of 1793 Stated that America would not join the war on either side.

14. Embroilments With Britain The British still held forts in the U.S. (A violation of the Peace Treaty of 1783) The British wanted to remain in the great-lake region fur trade They also begin to sell firearms to a group of Indians that were killing Americans (Miami Confederacy) Were seizing American merchant ships in the Atlantic and forcing Americans to serve in the Royal Navy. Jefferson wanted another war with Britain Hamilton did not want to because Britain could prove to be a huge economic ally in the future.

15. John Jay and Britain 1794 Washington was attempting to avoid war with Britain. John Jay Sent to London by George Washington negotiate (Washington’s decision opposed by the Jeffersonian Democratic-Republicans)

16. Jay’s Treaty The British promise: 1. to evacuate their posts in North America 2.Pay for the money-loss from seized American ships The British DO NOT promise 1.To stop future seizures of American ships 2.To stop selling arms to the Indians The U.S. has to pay off all pre-Revolution debt owed to the British. Jeffersonian Democrats were outraged and viewed the treaty as a surrender to the British

17. Spain Scared Spain mistook Jay’s treaty for and Anglo-American alliance Spain offers America a deal to keep then from allying with Britain. Pinckney’s Treaty of 1795 Settled between Spain and the U.S. 1.Gave the U.S. navigation rights of the Mississippi River 2.Gave the U.S. the territory of North Florida

18. The Whiskey Rebellion “The Whiskey Rebellion” 1794 Led by whiskey distillers in Pennsylvania who opposed the 1791 excise tax on Whiskey that was imposed through Hamilton’s financial plan. Similar in size and power to Shays’ Rebellion Washington viewed the rebellion as a direct threat to the Nation, and sent in 13,000 Federal troops to thwart it. Important because it displayed the power of the federal government.

19. Washington’s Farewell Address 1796 George Washington Exhausted from the political battles between Hamilton and Jefferson, decides to leaves office after 8 years of service as the president Sets a Presidential tradition of only serving 2 terms Farewell Address 1.He urges America to not form any permanent military alliances 2.Tells the people to eliminate political parties

20. John Adams Elected President 1797 John Adams beat Thomas Jefferson and became the 2 nd President At the same time: Hamilton becomes the official leader of the Federalists party

21. France’s Retaliation As a result of Jay’s Treaty, France begins to retaliate against America They start to seize American merchant ships 1797 John Marshall Sent by John Adams to negotiate with French leaders Intended on meeting with French Foreign Prime Minister Charles Talleyrand

22. “The X,Y,Z Affair” When John Marshall got to France, his envoy was intercepted before reaching Foreign Minister Talleyrand Three men (Later referred to as X,Y,Z) stop the Americans and demand $250,000 just to speak with Minister Talleyrand Marshall was furious about the French proposition and returned to the U.S.

23. Preparing for War Angered over the “XYZ Affair” the Federalists begin to expand the military in preparation for war 1.The U.S. Navy is established 2.The U.S. Marine Corps is re-established When France learns about how the Americans perceived the “XYZ Affair”: They tell the U.S. to send another negotiator Guarantees this time he will be treated with upmost respect

24. The “Alien Law” The Naturalization Act Passed by John Adams and the Federalists because the majority of new immigrants supported Jefferson’s Democratic Republicans 1.Raised the residence requirements for foreigners who desired to become citizens of the U.S. (From 5 years to 14 years) 2.The President could jail or deport any foreigners at any time for any reason

25. The Sedition Act Sedition Acts (Also passed by Adams and Federalists) Fines and/or imprisonment for anyone who 1.who questioned the policies of the U.S. 2.Spoke negatively, or falsely against a government official The Sedition Act distressed many Americans because they felt it threatened their political and natural rights. The Federalist also supported a military buildup to suppress internal political dissent.

26. The Virginia and Kentucky Resolutions Jefferson’s Kentucky Resolution Madison’s Virginia Resolution 1.Both presented the theory of nullification The right of the states to nullify laws created by the federal government if they were unconstitutional. 2.Strong states’ rights arguments.

27. The Election of 1800 The election of 1800 (A rematch of the 1796 election) Thomas Jefferson and Aaron Burr (Democratic Republicans) John Adams and Charles Pinckney (Federalists) The Election of 1800 turned ugly. The Federalists started a “whispering campaign” against Jefferson in an attempt to ruin his reputation with the American people.

28. Election Results The outcome: Because of a flaw in the electoral college system, Jefferson tied with his Vice Presidential running mate, Aaron Burr. In the event of an electoral tie, the House of Representatives gets to choose the President. After 36 votes, the House finally chose Jefferson as the President of the United States. After the election of 1800 1.The 12 th Amendment to the Constitution was added to make sure that didn’t happen again. 2.The Federalist party was hopelessly split at this point. 3.John Adams refused to attend Jefferson’s inauguration.

29. The Revolution of 1800 Jefferson called his election, “The Revolution of 1800” There was a shift in political power from one party to the next, but instead of bullets, ballots were used to facilitate the change. He claimed he wanted to restore the ideals behind the American Revolution.