Now we have a Constitution…so now what?

Washington inaugurated 1789• Didn’t even want to be President• “I feel like a culprit going to the place of my

execution”• Live footage

Big Problems to deal with

• Formed cabinet (Hamilton, Jefferson, Randolph)– Adams relegated to being VP (worthless)

• How to handle the economy?

Hamilton becomes the man in charge of the economy

• One of the most brilliant minds of the generation

• Realized that a vibrant economy was key to the new country

• His system with a solid budget, a funded debt, a federal tax system, a national bank, a customs service, and a coast guard provided the foundations for American Capitalism and American Government

His plan, however, was controversial

• Watch the video clip and try to understand why his vision is controversial

He comes up with a 3 part plan

• Goal is to stabilize the economy.1. Assume debts of ALL states2. Create a National Bank3. Impose Tariffs

Assumption of debts

• Would create a vested interest in the government• Would relieve states of burden• Would necessitate a federal tax structure• Became a regional issue– South repaid much debt– Should the farmers subsidize the merchants?

• Some had sold their bonds for whatever they could get…should they get the shaft?

• “The Dinner Deal”

National Bank

• Would create a vested interest in the nat. gov’t.

• Would provide credit for the young nation• Stable uniform currency• Constitutional?– Again, a sectional issue (North voted in favor while

South was against)– “Necessary and Proper”– Supreme Court eventually supports it

Encourage Manufacturers

• Would provide jobs, growth, and a robust economy– Would then help the south because the north

would demand more of their agriculture

• Again, should the South subsidize the North?

Overall, his policies worked

• 1790’s economic prosperity– Paid down the debts

• More importantly, though, was the foundation that was laid.– Helped people see beyond their localities and

states and view the republic as a whole.

While his policies worked, they served to create tension

• A “Republican” alternative• A party system emerges.

Federalists

• Favored a strong federal government• Believed Hamilton’s economic policies to be wise• Interpreted the Constitution loosely• Mostly urban merchant-class and upper class– Favored a shipping/manufacturing based economy

• Harkened to the British way and model (therefore, anti-France)

• Leader of party was Hamilton• Fear of mob-rule

Republicans (Democratic-Republicans)

• Favored strong state governments• Therefore, a strict interpretation of Constit.• Felt Hamilton’s plan put too much power in

fed gov’t and wealthy elite• Mostly “plain” sort of people• Favored an agrarian based economy• Fear of absolute power/rulers• Leaders were Jefferson and Madison

Washington’s 2nd term became problematic

• France v. Britain War pulled America in• Neutrality Proclamation• Citizen Genet• Native issues (Treaty of Greenville)• Jay’s treaty• Pinckney’s treaty (Spain-New Orleans open and

Mississippi River rights)• Farewell Address (unity, avoid faction, commercial relations,

avoid perm. Alliances)

John Adams becomes 2nd Pres.

• Defeats Jefferson (Jeff. becomes VP)• He disliked Hamilton but agreed with many of his ideas

(Hamilton resigned in 1795 but still had influence).

• Alien and Sedition Acts (1798)• Led to Virginia and KY Resolutions…

– Nullification?– Matthew Lyons v Roger Griswold bring

party passions to a crescendo• Pulled into war (undeclared war 1798-1800)

– XYZ affair (1797)– Did well to keep us out…but…Alien and Sedition Acts

were his downfall

Election of 1800

• Hostility toward Adams and the Federalists boiled over (taxes, standing army, Alien and Sedition Acts, Jay’s Treaty)

• Hamilton turned against Adams and Adams lost to Jefferson (and Burr)

• Before Federalists left office, their legacy was left with stacking the courts (“Midnight Appointments” Marshall, etc.)

• Jefferson takes office and calls it “The Revolution of 1800”– “we are all Republicans, we are all Federalists”– Inaugurated in dc

• HUGE event…peaceful transfer of power

Jefferson in office

• Marbury v Madison– Supreme Court can now declare laws unconstitutional!!!! HUGE!

• Louisiana Purchase– Steal of a deal emerged! Problems in Haiti led Napoleon to sell. $15 million ($.03 an

acre!)– Out go Lewis and Clark on a “scientific expedition”– How is this hypocritical of Jefferson?

• Overall, he reformed much of the federalist policies (reduced excise taxes, reduced military…but kept the bank and tariffs…he was still nationalistic)

• Much like Washington and Adams, he was plagued by the war in Europe (Chesapeake incident in Norfolk)– Could have had war on the spot…opted for an embargo instead (is that

constitutional?) and that didn’t work

Don’t call me a hypocrite, I’m on the nickel!

Madison takes office next• Much like Wash, Adams, and Jeff, he is

bamboozled by war in Europe.