Development of a New Nation Washington and the domination of Alexander Hamilton George Washington Inaugurated April 30 th, 1789 Washington is inaugurated as the nations first president First Congress created 3 executive departments Department of State Thomas Jefferson Department of Treasury most important post at the time Alexander Hamilton Department of War Henry Knox Judiciary Act of 1789 Supreme Court will have 6 judges, a Chief Justice (John Jay), and 5 associate justices Hamilton and Financials Dominate The most serious problem facing the new government was finances For the most part we had not repaid most of the money that we had borrowed from foreign sources and its own citizens The federal treasury did not hold enough money to operate the government. Hamilton had many good ideas on how to fix the financials of the country George Washington Alexander Hamilton Restoring Credit Hamilton believed that they U.S. government had to pay its debts in full, both abroad and at home Federal Government owed about $44 million to Americans The people wanted their money back The nations capital was relocated to Washington D.C. to appease the south in the debate over how they would get their money back Establishing a National Bank Hamilton proposed that a National Bank be organized 1. It would provide a safe place for federal funds 2. It would make it easier for the government and private individuals to borrow 3. It would create a uniform and dependable currency by issuing sound paper money It would be headed in Philadelphia Many people thought that this plan was unconstitutional because the Constitution did not specifically grant Congress the power to create banks Hamilton maintained that it was Constitutional Congress had the right to coin money, create taxes, and borrow money The Elastic Clause This is a clause in the constitution in which enables congress to do what is necessary and proper to carry out its specified tasks. People who believed that the Constitution must be followed exactly as written is called strict construction these people became known as Democratic-Republicans People who believed that the Constitution had gray area and that Congress has powers that are implied within is called loose construction these people become known as Federalists Other financial policies Creating a coinage system set up a mint to produce a new series of gold, silver and copper coins Raising money placed a tax on the making of whiskey Farmers were making distilled whiskey from their surplus grain were upset by the tax because it cut into their profits Farmers in PA refused to pay the tax and threatened the federal tax collectors with violence 13,000 troops were sent out to put down the Whiskey Rebellion Hamilton believed that the United States should encourage manufacturing Hamilton's financial program created a strong foundation for the United States but it helped out the well-to do more than average Americans it created a division among the people the first political parties. The First Political Parties Federalists Backed Hamiltons polices Strong in the Northeast Mainly merchants, bankers, and manufacturers Favored a strong national government and loose construction of the Constitution Encourage commerce, industry, and farming Distrusted democracy Democratic-Republicans Thomas Jefferson and James Madison Supported the South and West Most were small farmers and laborers Feared that a strong federal government might hamper individual freedom Support strict construction of the Constitution Washington considered a Federalist Some in between years In the years in between, as a new nation we run into some issues We somehow begin to have issues with France, Britain, and Spain Sign multiple treaties that help us get back into better terms with these countries John Adams as president Federalist candidate VP = Thomas Jefferson Under Adams we had some more issues with France. Adams sent some people to France to settle the difficulties and our opposition to France increased From We fought an undeclared naval war with France Our small navy took over 80 French ships and we came to a peace agreement Alien and Sedition Acts At the height of the French crisis the Federalist Congress passed four laws 1. raised the residency requirement for citizenship from 5 to 14 years 2. Gave the present power to deport any alien considered dangerous to the nation 3. Gave the present authority to arrest or deport enemy aliens in time of war 4. Made it a crime to publish false, scandalous, and malicious, writing about the U.S. government or its officials Said these were necessary war measures Really just a way to trap the Democratic-Republicans Eventually Kentucky and Virginia declare them unconstitutional