Hamilton vs. Jefferson:
Balancing Order & Liberty
Personal Differences
• Hamilton was born out of
wedlock in the British
West Indies
• Orphaned at an early age
• Benefactors provided him
with money to study in
New York (King’s
College – aka, Columbia)
• Served as Washington’s
aide de camp during the
Revolutionary War
• Drafted The Federalist
Papers with Madison/Jay
• First Secretary of the
Treasury
• Jefferson was born to
wealthy parents in
Virginia
• Had a relatively sheltered
upbringing
• Studied at William &
Mary College
• Served in the House of
Burgesses and the
Continental Congress
• Drafted the Declaration of
Independence
• Served as Ambassador to
France in the late 1780s
• First Secretary of State
Philosophical Differences
• Hamilton distrusted the
masses, favored government
by self-made men (elites)
• Believed that America
would become an
industrial/commercial power
• Supported strong central
government to preserve
order and secure liberties
• Argued for “loose”
interpretation of the
Constitution to give the
central government power to
deal with challenges
• Jefferson placed confidence
in the “common man” (to an
extent)
• Believed that America
should be an agrarian
republic of “virtuous citizenfarmers”
• Distrusted centralized
government – favored states’
rights and individual liberties
• Argued for “strict”
interpretation of the
Constitution to limit national
power and preserve liberty
Economic Policy
• Hamilton’s financial plan
aimed to put the country
on a firm economic
footing
1. Funding of national debt
and assumption of state
debts
2. Tariffs and excise taxes to
provide national revenue
and protect “infant”
industries
3. Central bank to provide a
source of credit and a safe
place for federal deposits
• Jefferson criticized the
plan as a means of
consolidating the financial
power of the elite
• Challenged funding of
debt because it would
benefit speculators, not the
original purchasers
• Considered assumption of
state debts as unfair
because it benefited
northern states more
• Tariffs and a central bank
also tended to help
northern, urban interests at
the expense of southern,
rural Americans
The “Compromise of 1790”
Once an ally of
Hamilton in the
ratification debate,
Madison distrusted
Hamilton’s views
on executive power
• Congress refused to pass
Hamilton’s assumption plan
because of opposition from
James Madison and other
southerners
• Jefferson invited Hamilton
and Madison to dinner at his
townhouse in New York City
and worked out a
compromise
• Madison would support the
assumption bill in exchange
for Hamilton’s pledge to
support the choice of the
Potomac as the site of the
nation’s permanent capital
Foreign Policy
• Hamiltonian Federalists
distrusted the radicalism
of the French Revolution
and sought to emulate the
British system of strong
banks and commerce
• Washington declared
formal neutrality in 1793
to avoid involvement in
the European crisis
• Supported the Jay Treaty
(1794), which made
concessions to Britain on
trade issues but also
avoided war
• Jeffersonian Republicans
embraced the French
Revolution and argued
that the U.S. should
remain loyal to its ally
• Jefferson officially
supported neutrality but
was attacked for his
continued support of
revolutionary France, he
resigned from GW’s
cabinet in 1793
• Republicans criticized the
Jay Treaty as a “sell out”
to the British
Use of National Power:
The Whiskey Rebellion
• Washington led 15,000
militia into western
Pennsylvania, the only
time that a sitting
president has led his
troops into military action
• Western Pennsylvania
farmers rebelled against
high excise taxes on
whiskey in 1794
• Washington responded by
calling out the military to
put down the rebellion
• Federalists argued that
national power must be
asserted to demonstrate
the new country’s stability
and to make the point that
challenges to government
policy must be peaceful
Washington’s Farewell Address
• Washington warned against both
factionalism and “foreign
entanglements” in his last published
address as president (1796)
• He was especially concerned that the
emerging split between Federalists
(led by John Adams and Hamilton)
and Republicans (led by Jefferson
and Madison) would split the country
apart along sectional lines
• The election of 1796 was the first
two-party election in U.S. history;
Adams won but Jefferson became
vice-president
Quasi-War & the Alien & Sedition Acts
By 1797, the French intercepted
American vessels seeking to trade
with Britain
“XYZ Affair” – American officials
sent to negotiate with the French
were expected to pay a bribe
American outrage led to an
undeclared naval war with France
(the Quasi-War)
The Federalist-controlled Congress
cracked down on dissent with the
Alien & Sedition Acts (1798)
States’ Rights &
the “Revolution” of 1800
• Jefferson and the Republicans responded with
charges that the Federalists were abusing individual
liberties under the First Amendment
• Madison & Jefferson drafted the Kentucky &
Virginia Resolutions, which argued that states had
the power of both interposition and nullification (the
heart of states’ rights doctrine) to defend the rights
of the people
• Republicans used the issue to help win the election
of 1800 (first peaceful transfer of political power
between parties in American history)