Political Crisis of the 1790s: Part IAPUSH: Spiconardi

George Washington• George Washington was

elected president in 1789• Why Washington?• Seen as virtuous

disinterested man• Respected for leading

America to victory over the British

• Model of self-sacrificing republican virtue

• Seen as a cautious and pensive man

I anticipated, in a heart filled with distress, the ten thousand embarrassments, perplexities and troubles to which I must again be exposed to in the evening of a life, already nearly consumed in public cares

. . . I assure you . . . that my movements to the chair of Government will be accompanied with feelings not unlike those of a culprit who is going to the place of his execution…

But to say I feel pleasure from the prospect of commencing another tour of duty, would be a departure from truth 

George Washington• Precedents • Two-term presidency

• FDR would later ignore this precedent

• An amendment would be passed limiting presidents to serve a maximum of two terms

• The Cabinet senior advisor’s appointed by the president• Not specifically mentioned in

the Constitution

Hamilton’s Financial Vision• Hamilton wanted to transform an

economically weak United States into a global power comparable to Great Britain

• In order to create a vibrant economy, Hamilton needed to nurture the capitalist spirit of Americans

• The federal government should encourage entrepreneurship and investment

Hamilton’s Financial Vision• “Report on Public Credit”• The United States needed to establish

credit, but had over $75 million in debt• Hamilton believed the U.S. had to pay

down the debt• How?

• Redeem Confederation securities at face value• Most veterans had sold securities to

speculators• Federal government would pay off states

war debts• Most southern states had already paid off

their debts

• Jefferson and Madison opposed Hamilton’s plans

Hamilton’s Financial Vision• “Report on Public Credit”

(Con’t)• The Compromise• In the Summer of 1790,

Hamilton, Jefferson, and Madison met

• A new national capital would be established on the banks of the Potomac River• Move capital from New York

to Philadelphia for 10 years while Washington, D.C. was built

• This secures the congressional votes need to pass Hamilton’s plan.

The L’Efant Plan for Washington, D.C.

Hamilton’s Financial Vision• The Bank of the United States• Hamilton asked Congress to

charter a bank that would be jointly owned by the national government and private stockholders

• The national bank would be able to make loans to merchants in order to spur economic growth through deposited tax money

• Jefferson believed the bank was unconstitutional

Hamilton’s Financial Vision

Strict Interpretation• Jefferson: “The

incorporation of a bank, and the powers assumed by this bill, have not, in my opinion, been delegated to the United States, by the Constitution.”

Loose Interpretation • Hamilton: Article 1, Section 8:

“The Congress shall have Power ... To make all Laws which shall be necessary and proper for carrying into Execution the foregoing Powers, and all other Powers vested by this Constitution in the Government of the United States, or in any Department or Officer thereof.”

This has become known as the

ELASTIC CLAUSE

Hamilton’s Financial Vision• “Report on Manufactures”• Hamilton needed to find a source of revenue to pay interest on the

national debt• How does any government raise money?• Excise tax on whiskey

• Hamilton believed this would raise $1.2 million annually• Tariffs

• To encourage the purchasing of American manufactured goods, a moderate tariff was placed on foreign goods

• Who does this benefit? To whom is it a detriment?

Whiskey Tax Receipt

Whiskey Rebellion (1794)• During this time period, the

average American drank five gallons of whiskey per year

• With the excise tax on distilled spirits, the demand for corn whiskey farmers distilled had significantly decreased

• Whiskey Rebels• Assaulted tax collectors• Burned the home of tax collector• Destroyed the stills of those who

paid the tax

Liberty! Equality! Fraternity!

Whiskey Rebellion• Washington’s Course of Action• Washington issued a proclamation ordering the insurgents home and

calling for the militia to head to Pennsylvania• Thirteen thousand soldiers march to the rebellion• Most rebels flee, but twenty were arrested. Only ten stood trial and only

two convicted (Washington would pardon them)

Whiskey Rebellion

• Impact of the Whiskey Rebellion• Demonstrates the strength of the new federal government

• Government will willing and able to suppress violent resistance of its laws• Sympathizers of the Whiskey Rebels joined the emerging Republican

Party• Demonstrates growing divisions in the United States

• Whiskey rebellions continued as many continued to refuse paying the tax