1. Answer BOTH of the following: a)What did Shay’s Rebellion prove? b)What did Shay’s Rebellion lead to?

2. 1) Compare and contrast the political ideas of Hamilton and Jefferson. 2) Explain how the differences created the first 2 political parties (the 2 party system).

3. In April of 1789, George Washington took the oath of office in NYC, as the first president of the United States of America. Washington understood that he was undertaking a great responsibility in this great new experiment.

4. Washington’s First Year Judiciary Act of 1789 Created the federal court system and set the number of supreme court justices Established a Cabinet 4 positions: -Secretary of State -Secretary of Treasury -Secretary of War -Attorney General Debate Begins Hamilton and Jefferson were political opposites. Hamilton favored a strong central government (federal/national/central government). Jefferson supported state and local governments.

5. The nation is in deep debt, mostly from the Revolutionary war. States are in debt also, however many Southern states have paid off most of their debt. President Washington Knox (Sec. of War) Hamilton (Sec. of Treasury) Jefferson (Sec. of State) Randolph (Attorney Gen.)

6. As Secretary of Treasury, Hamilton had a bold plan to issue new bonds to replace old ones, give wealthy individuals a stake in the success of the new government, and create a national bank. Southerners hated this plan because they thought they would be over taxed to pay for the northern states’ debt. *(Remember most of the Southern states had already paid off their debt)*

7. Would be funded by the federal government AND private investors. Would issue money, handle tax receipts, and other funds. Many people disliked the idea, but Hamilton felt Congress could still pass it under the “necessary & proper” statement of the ELASTIC CLAUSE!!

8. In order for the Southern states to approve of a B.U.S., the nation’s capital was moved from Philadelphia to an area between Maryland and Delaware (a new “district” called the District of Columbia). Despite the Compromise, arguments continued between Hamilton and Jefferson

10. Continued conflict between Hamilton and Jefferson divided the cabinet and the nation. The parties formed around key issues in American politics like… -Power of the Federal Government -Size of the Federal Government This 2-party system was established by the time George Washington’s presidency was over, even though Washington was nervous about political parties.

12. Issue: Tariffs and Excise taxes. Western farmers rebelled after an excise tax was passed on whiskey (their biggest $ maker). The Federal Gov’t stepped in. In 1789, Congress passed a tax on goods produced in Europe. This was a good money maker for the Federal Government. To make more money, Hamilton decided to tax whiskey  Whiskey was the major source of income for western frontier farmers. They refused to pay the tax and even assaulted some federal tax marshalls  Washington sent out the militia to end the rebellion. This worked!!! This is important because it showed that the Federal Government could actually enforce their laws now!!