LAUNCHING THE NEW SHIP OF STATE

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1 CHAPTER 10 LAUNCHING THE NEW SHIP OF STATE GROWING PAINS THERE WAS VERY LITTLE TRUST IN THE NEW GOVERNMENT VIRTUALLY NO REVENUE ($) WAS COMING IN INFLATION WAS RAMPANT DUE TO THE PRINTING OF PAPER MONEY COLONIAL PAPER $ THE FIRST PRESIDENT GEORGE WASHINGTON WAS UNANIMOUSLY ELECTED PRESIDENT INAUGURATED IN THE TEMPORARY CAPITAL - NEW YORK CITY 1

2 WASHINGTON S CABINET FIRST THREE CABINET DEPARTMENTS SECRETARY OF STATE THOMAS JEFFERSON SECRETARY OF THE TREASURY ALEXANDER HAMILTON SECRETARY OF WAR HENRY KNOX BILL OF RIGHTS A BILL OF RIGHTS PROTECTED FROM THE NEW NATIONAL GOVERNMENT AS NEEDED INITIALLY JAMES MADISON WROTE 12 ONLY 10 ADOPTED 9TH AMENDMENT - DOESN T LIMIT THE RIGHTS PROTECTED TO ONLY THESE 10TH AMENDMENT - RIGHTS NOT GIVEN SPECIFICALLY TO THE NATIONAL GOVT. GO TO THE STATES JUDICIARY ACT OF 1789 ORGANIZED THE SUPREME COURT CHIEF JUSTICE + 5 ASSOCIATE JUSTICES FIRST CHIEF JUSTICE JOHN JAY CREATED FEDERAL AND DISTRICT COURTS CREATED THE ATTORNEY GENERAL OFFICE (NEW CABINET MEMBER) 2

3 HAMILTON S ECONOMIC PROGRAM WOULD FAVOR THE WEALTHY WHY? THEY WOULD LEND THEIR SUPPORT & $ 5 GOALS 1. FUNDING 2. ASSUMPTION 3. TARIFF 4. EXCISE TAX 5. BANK OF THE UNITED STATES HAMILTON S ECONOMIC PLAN GOAL # 1 - FUNDING PURPOSE WAS TO IMPROVE THE NATION S CREDIT WAS NO CONFIDENCE IT WOULD BE ABLE TO PAY OFF ITS DEBT THE NEW GOVT. WOULD FUND THE ENTIRE NATIONAL DEBT PAY OFF THE DEBT AT FACE VALUE PLUS INTEREST (OVER $54 MILLION) WEALTHY SPECULATORS HAD BOUGHT UP THE BONDS VERY CHEAPLY AND WOULD MAKE A HUGE PROFIT HAMILTON S ECONOMIC PLAN GOAL # 2 - ASSUMPTION THE NEW NATIONAL GOVT. ASSUMED ALL THE STATES DEBTS WOULD BIND ALL THE STATES TOGETHER WHERE WOULD THE $ COME TO PAY THIS LARGE DEBT OFF? $75 MILLION 3

4 HAMILTON S ECONOMIC PLAN GOAL # 2 - ASSUMPTION HAMILTON SAW DEBT AS A GOOD THING ALSO GOOD TO OWE $ TO THE WEALTHY NOW. HOW TO RAISE THE $??? HAMILTON S ECONOMIC PLAN GOAL # 3 - TARIFF TARIFF - A TAX ON IMPORTED GOODS WOULD RAISE $ AND PROTECT EMERGING INDUSTRIES PASSED A LOW TARIFF IN 1789 HAMILTON S ECONOMIC PLAN GOAL # 4 - EXCISE TAX OTHERWISE KNOWN AS A SALES TAX ON A FEW SPECIFIC DOMESTIC ITEMS ONE IMPORTANT ONE WAS WHISKEY NOW WHERE TO KEEP ALL THIS $?? 4

5 HAMILTON S ECONOMIC PLAN GOAL # 5 - BANK OF THE U.S. WOULD BE A PRIVATE INST. WHERE THE GOVT. WAS A MAJOR STOCKHOLDER GOVT. WOULD DEPOSIT ITS $ IN IT FEDERAL GOVT. $ WOULD REMAIN IN CIRCULATION COULD PRINT SOUND PAPER CURRENCY JEFFERSON VS. HAMILTON ROUND #1 Jefferson was a strict constructionist if not in the Const. - can t do it (states could) said the bank was unconstitutional Hamilton was a loose constructionist necessary & proper clause (implied powers) Government can pass any law needed to carry out government business Hamilton wins - Bank of the U.S. created in 1791 Whiskey Rebellion A rebellion started over the excise tax on whiskey (Shays Rebellion???) Washington summoned the militia 13,000 - led by Washington & Hamilton Rebellion over by the time they got there - scared the crap put of them New govt. had respect, but overkill? 5

6 Emergence of Political Parties Opposition began to build to Hamilton Hamilton vs. Jefferson turns into our first political parties Federalists - Hamilton & followers Democratic Republicans - Jefferson, Madison, & followers Washington s Neutrality Proclamtion After the French Revolution, France & Britain went to war We still have an alliance with France Washington issues his Neutrality Proclamation (1793) The U.S. to militarily & economically weak Politically too divided Was a very controversial decision Jay s Treaty Threat of war again with Great Britain To avoid it he sent John Jay to G.B. Jay s Treaty British promised to leave forts in NW British would pay damages for sieze ships Said nothing about stopping the practice Jay agreed the U.S. would still pay off all debts to British creditors Was incredibly unpopular! 6

7 A New President? vs. Would it work without GW? 1796 John Adams (Federalist) v. Thomas Jefferson (Republican) A dirty campaign where personalities were a big issue Adams wins barely Jefferson becomes V.P. Rule changed by 12th Amend. PROBLEMS WITH FRANCE The French were mad about Jay s Treaty Saw it as a step towards alliance with G.B. Began to seize U.S. ships The U.S. govt sent a group to work things out XYZ AFFAIR Three French ministers demanded a bribe be paid to meet with Talleyrand X, Y, & Z Became public and seen as a huge affront Led to calls for war with France 7

8 End of Adams Presidency? Navy Dept. created, Navy expdanded New army of 10,000 authorized Undeclared war waged in the W. Indies for 2 1/2 years Convention of 1800 Ended the conflict Ended Adams hope for a second term Alien & Sedition Acts Two laws passed in the midst of the conflict with France Aimed at those who opposed war with France (Republicans) Very popular Outraged Jefferson & Madison Virginia & Kentucky Resolutions Nullification (later used by the South before CW) Election of Parties Federalists (Hamilton) Favored the wealthy Supported strong central govt. Pro-British Supported trade & commerce Republicans (Jefferson) Favored weak central govt. Pay off national debt Pro-French Pro-Farmer Rule of the People Educated people 8

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