Challenges to the New
Government
What are the major problems with the United
States?
How does Washington try to solve this?
How are Shay’s rebellion and the Whiskey’s
rebellion similar and different?
George Washington takes office
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April 30 George Washington inaugurated
Inauguration: ceremony in which president
officially takes the oath of office
Precedent: an act or a decision that sets an
example for others to follow
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George Washington takes office
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Forms a cabinet
Cabinet: heads of departments
5 created: State, Treasury War, Attorney General, & Postmaster
Advice the president
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Secretary of State: Thomas Jefferson
Secretary of Treasury: Alexander Hamilton
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George Washington takes office
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Federal Court System set up
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Judiciary Act: Start of Supreme Court 1789
John Jay: 1st Chief Justice of the United States
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Problems with new nation
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Huge national debts!
National Debt: amount
of money the
government owes to
other
During war the US
borrowed lots of $$$$
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Hamilton’s Plan
•bond: certificate that promises to repay money
loaned, plus interest on a certain date.
•Hamilton wanted the government to repay
federal and state debts and buy up bonds
•He then wanted to issue new bonds for debt
• He wanted a National Bank to give more
crediability
Alexander Hamilton on a National Bank
Hamilton’s Compromise
•James Madison hated Hamilton’s plan
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•He thought this would lead to speculations
•Speculator: someone who invest in a risky venture in
the hope of making a large profit
Hamilton’s Compromise
•Agreed to build capital city in South
•States agreed to repay state debts
•Start of a national bank: Bank of the United States
•Washington DC was built!
Rebuilding the Economy
Whiskey Rebellion
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To help pay off the war debt, Washington
started to tax whiskey
Whiskey is an alcoholic beverage
The farmers who grew the grain to make
the whiskey were angry.
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Why whiskey?
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Farmers had a hard time getting their grain to
market, so they turned their grain into whiskey,
which was easier to transport.
They got more money for the whiskey anyway.
Farmers traded the whiskey for salt, sugar, and
other goods.
Farmers used whiskey as money to get
whatever supplies they needed.
Farmers did not have the money to pay for the
tax.
The Rebellion
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In the summer of 1794, a group of farmers
in Western Pennsylvania rebelled against
the whiskey tax and staged the Whiskey
Rebellion.
One group beat up a tax collector and
coated him with tar and feathers.
Why do you think tax collectors were tarred and
feathered?
The Government Responds
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Alexander Hamilton wanted the
government to look strong. He
encouraged President Washington to
stop the revolt.
Federal troops marched to Western
Pennsylvania and put down the revolt.
Washington had proved that the
government would deal with people not
obeying the law.
Why do you think Washington chose to lead the troops
himself?
Current issues:
Does the US have debt?
U.S. Debt Too Big for National Debt Clock
How are we handling our debt issues?
Why is China buying more U.S. debt?
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http://www.earlyamerica.com/review/fall96/whiskey.html