CHAPTER 10: LAUNCHING THE NEW SHIP
OF STATE (1789-1800)
I shall only say that I hold with Montesquieu, that a
government must be fitted to a nation, as much as a
coat to the individual; and, consequently, that what
may be good at Philadelphia may be bad at Paris and
ridiculous at Petersburg.
- Alexander Hamilton
FIRST CENSUS:
4 MILLION(90% RURAL)
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Philadelphia (42,000) / New York (33,000) / Boston
(18,000) / Charleston (16,000)
Population of the United Kingdom: 8 million
STRUGGLES OF THE NEW NATION
Public debt was enormous; revenue had
significantly declined
 Worthless paper money, both state and
national, was in circulation
 Foreign challenges by Britain and Spain (and
Native Americans) threatened the unity of
the U.S.

WASHINGTON IN NEW YORK
Took oath of office on April 30,
1789 in temporary capital of NYC
 John Adams: Vice President
 Creates the “cabinet”

 Secretary
of State: Thomas Jefferson
 Secretary of the Treasury: Alexander Hamilton
 Secretary of War: Henry Knox
 Attorney General: Edmund Randolph
CONGRESS CONVENES AND THE REPUBLIC
BEGINS

Bill of Rights (First Ten Amendments)
 Anti-Federalists
had sharply criticized the
Constitution for not having one.
 James Madison (“Father of the Constitution”)
drafted the amendments and submitted them to
Congress

Judiciary Act of 1789
Organized the Supreme Court with a chief justice
(John Jay) and five associates
 Organized federal district and circuit courts.


Major differences between the Articles and
Constitution, right?
HAMILTON’S FINANCIAL PLAN

Five major components
1. Increase national credit
 Debts
would be paid at face value plus accumulated interest
 Although a national debt, within limits, can be viewed as a
“national blessing”
2.
Assumption of State Debts
 Wealthy
creditors who held the debt would be loyally bound to
the national government that was able to pay it off
 States with huge debt were delighted (esp. Mass.)
 States with less debt or no remaining debt were unhappy
(generally the South)
 South would get a new federal district-- now District of
Columbia
HAMILTON’S FINANCIAL PLAN
3.
Tariffs (taxes on imports) became a source
of revenue and protection for
manufacturers
Northerners
tended to favor high tariffs,
Southerners tended to favor low tariffs
4.
Excise taxes (an extension of federal power)
A
Federal or state tax imposed on the
manufacture and distribution of certain nonessential consumer goods
Backcountry distillers of whiskey most affected
by the 7 cent/gallon tax.
 Whiskey was often used as money
HAMILTON’S FINANCIAL PLAN
5.
Create a National Bank (B.U.S.)
Federal
Treasury would deposit its surplus moneys
in the bank
Government would print needed paper money
thus providing a stable national currency.
HAMILTON’S FINANCIAL PLAN

Strict construction
 Jefferson:
Constitution did not stipulate creation
of a national bank

Loose construction
 Hamilton:
favored a broad interpretation of the
Constitution
 "necessary and proper" clause [creates the idea
of “implied powers”] stretches the Constitution
 Set a precedent for enormous federal powers
despite the 10th Amendment that protects states’
rights
 Washington reluctantly signed the bank measure
(creating the B.U.S.) into law
WHISKEY REBELLION (1794)
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Southwestern Pennsylvania backcountry folks hard hit
by Hamilton's excise tax
Torched buildings, tarred and feathered revenue
officers, chased government officials
Tax collections came to a halt.
Washington summoned the militia of several states
resulting in 13,000-man army.
When the troops reached the hills of w. Pennsylvania
the Whiskey Boys dispersed
Significance: Washington's government showed it
could ensure domestic tranquility (condemned for
“using a sledgehammer to crush a gnat”)
DEMOCRATIC-REPUBLICANS
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Jefferson
Advocated the rule of the
people; government for the
people (the states)
Biggest appeal was to the
middle class and the
underprivileged
The best government was
one that governed least
Jeffersonians themselves
were primarily agrarians
Pro France
FEDERALISTS
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Hamilton
Supported a strong central
government
Protect life and property of
the wealthy
Federalists dominated by
merchants, manufacturers,
and shippers
Pro Great Britain
CLICK ON THE LINK BELOW TO
LEARN THINGS!
BIRTH OF THE TWO PARTY SYSTEM
FEDERALIST ERA FOREIGN POLICY

The French Revolution
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One of the most important issues separating Federalists
and Dem.-Republicans
Britain pulled into that conflict which became a world
war
Washington proclaimed U.S. neutrality toward the war
between Britain and France
American Reaction


Jeffersonians enraged, especially by Washington for not
consulting Congress.
Federalists supported it.
WASHINGTON'S NEUTRALITY
PROCLAMATION (1793)

Edmond Charles Genet known as Citizen Genet
 French
ambassador
Wrongly believed Neutrality Act did not truly
reflect the wishes of Americans.
 Suggested going over "Old Washington's" head
by appealing to the voters.
 Washington demanded his withdrawal and
Genet was replaced (this discredits pro-France
Dem-Reps)

JAY TREATY
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Background: British had
continued menacing
Americans on U.S. soil and
on the high seas
Provisions: America won
few concessions
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British renewed their pledge
to remove their posts from
U.S. soil (as in 1783)
British consented to pay
damages for recent seizures
of American ships
British refused to guarantee
against future maritime
seizures and impressments
Jay bound the U.S. to pay
pre-Revolution debts owed
to British merchants
PINCKNEY TREATY

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Normalized relations with
Spain
Spain’s position was
declining on the American
frontier
Treaty provisions: (Spanish
concessions)
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Granted free navigation of
the Mississippi to the U.S.
including right of deposit at
port city of New Orleans
Yielded large area north of
Florida that had been in
dispute for over a decade.
Why did we get so much?
Fear of the British
FEDERALIST FOREIGN POLICY TREATIES
BATTLE OF FALLEN TIMBERS (1794)
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Indians finally forced to abandon their British allies
Treaty of Greenville (1795) – cleared 2/3 of Ohio and
Indiana of Indian tribes
Eastern Woodlands Indians now saw their lifestyle
ruined by increased
competition for fur
trade, white
settlement, and
destruction of their
hunting grounds
#1 – Anthony Wayne, #2 – Little Turtle, #4 - W.H. Harrison,
#5 – William Clark, #6 – Merriwether Lewis, #7 – Blue Jacket
GEORGE WASHINGTON’S FAREWELL AND
LEGACY
Refused to accept a third term as President
 Set a precedent for the 2-term presidency
 In his Farewell Address he warned against the
evils of political parties -- partisan
bitterness/factions
 Warned against permanent foreign alliances
(like treaties with France)
 President came to rely on department heads
for advice and consult regularly with
his cabinet.

THE ELECTION OF 1796
T. Jefferson
Dem.Republican

J. Adams
Federalist
Adams defeats Jefferson 71-68 in the Electoral College
 Jefferson, as runner-up, became V.P.
WAR WITH FRANCE
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French government infuriated
by Jay Treaty as an initial step
towards alliance with Britain
French warships began seizing U.S.
merchant vessels (about 300 by mid-1797)
President Adams sent a delegation to Paris in 1797
French demanded a large loan of $32 million and a
bribe of $250K for U.S. privilege of merely talking to
foreign minister
This became known as the XYZ Affair (“Millions for
defense, not one cent for tribute!”)
Undeclared Naval Warfare, 1798-1799 (which party is
helped here?)
ALIEN AND SEDITION ACTS (1798)
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Purpose: Federalists passed a series of oppressive
laws in 1798 that would reduce power of DemocraticRepublicans
Alien Acts
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Sedition Act: Anyone who impeded the policies of gov't
or falsely defamed its officials, incl. the president,
would be liable to a heavy fine and imprisonment
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Raised residence requirements for U.S. citizenship from 5 yrs to
14 yrs (Naturalization Act)
President empowered to deport "dangerous" foreigners
Violation of the 1st Amendment
Adams finished his term keeping us out of war with
France but these laws hurt the Federalists
VIRGINIA AND KENTUCKY RESOLUTIONS
Jefferson & Madison secretly created a series
of resolutions
 Premise

 States
have fundamental rights that the federal
government cannot abridge
 The U.S. Constitution exists as a compact between
the federal and state governments
 States can nullify federal laws that they judge to be
unconstitutional

Who created the federal government, anyway?
ELECTION OF 1800
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Jefferson defeats
Adams: 73 to 65
Yet, Jefferson tied with
Burr (N.Y.), his V.P.
running mate, for
electoral votes
House of Reps had to
break the deadlock
Amendment XII fixes
the problem (1804)
“THE REVOLUTION OF 1800”
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Significance: Peaceful change of power (from party
to party) was revolutionary
Transfer of power on the basis of an election that all
parties accepted (Adams simply “surrendered” the
office)
“We are all Republicans, we are all Federalists.”
The end of the Federalist Party
FEDERALIST LEGACY (1787-1800):
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Party of the elite
Built enduring political and
financial foundations for the
new government
Diplomats kept the U.S. out of
war and signed treaties
Preserved democratic gains
of the Revolution and fended off anarchy.
Peaceful transition of power
Creation of two-party system.
Federalist demise a result of its inability to adapt to
changes (are there more “people” or “rich and wellborn”?)