Plotting the Course of the New Government: The Washington Administration

The First Congress Convened March 4, 1789 in NYC Only 8 Sens. & 13 Reps. showed Took a month before there was a quorum (minimum to conduct business of Congress - a majority)

President Washington Unanimous electoral vote Took office April 30,1789 in NY John Adams elected as VP 10 states voted (RI & NC had not ratified the Const. yet & NY didn’t have electors selected in time) Made triumphant 8-day journey to NY from Mount Vernon

Washington 57 at time of election 6’2” Wore dentures of varying types Quiet, dignified A poor & nervous speaker Distant relative to Queen Elizabeth II, Robert E. Lee, & Winston Churchill

Washington People universally confident in him He felt burdened with the job - bore the weight of expectation “I face an ocean of difficulties, without the competency of political skill, abilities, and inclinations which is necessary to manage the helm.” - Washington

Washington Created presidency as he went Each move set a precedent Stressed symbolic ceremony to bring dignity & respect to the office 1789 - Congress created executive departments & GW made cabinet appointments

The Departments & Leadership Department of State Sec. of State - T. Jefferson Department of Treasury Sec. of Treasury - A. Hamilton War Department Sec. of War - Henry Knox Attorney General Edmund Randolph

The Cabinet Secretaries of these departments were the origin of the presidential cabinet Cabinet an advisory body - not mentioned in the Constitution Const. did provide for heads of departments GW relied heavily upon his Cabinet

Office of the Vice President Washington minimized role of VP Adams played little role in the running of the govt. Adams referred to his position as “the most insignificant office” ever created

Some problems to start with... No bureaucracy to do the work of government Foreign office consisted of 3 men National treasury had little $ and a high debt Army had only 692 men & no real navy

The Courts Congress created effective courts under the Judiciary Act of 1789 Judiciary Act organized the Supreme Court with a chief justice & 5 associates Established federal district & circuit courts Created office of Attorney General

1st Chief Justice John Jay (NY) Collaborated w/ Madison on Federalist Papers A seasoned diplomat Served as CJ until 1795

National Revenue Problems Revenue = the govt’s biggest need Congress enacted a tariff intended to raise $ and protect domestic manufacturers from foreign competition Tariffs were to get country on a sound financial basis

Hamilton Washington’s Sec. of Treasury - he seized the initiative to take control of the nation’s finances Ambitious, quick-witted, energetic, and determined A born leader - recklessly fearless Charming but vain & quick- tempered Reluctant to forgive, impatient with critics & intolerant of error

Hamilton Country needed his drive & brains Submitted series of reports to Congress from 1/1790 - 12/1791 outlining his programs for finance and economic development Most of his programs adopted

Hamilton’s Financial Program Payment of the Foreign Debt To restore credit abroad Payment of Domestic Debt Pay off bonds at face value with new govt. securities Fed. govt. to assume all state debts

Hamilton’s Financial Program Fed govt. would pay domestic debts “at par” = face value + accumulated interest Many (soldiers, farmers) had sold original bonds for fraction of value to speculators to get quick $ Current holders would make a profit at expense of original holder

Criticism of funding the debt Advocates for original holders argued for reimbursement of loss Hamilton argued that speculators paid what market allowed at the time, risking their own loss. They should reap the benefit. Hamilton said plan was necessary to restore govt. credit - Congress passed it

Assumption of State Debt Most states borrowed to finance the war - therefore a national debt Hamilton thought it would strengthen ties of states to Fed govt. Would shift attachment of wealthy creditors from states to Fed govt. Hamilton wanted support of rich

Assumption of State Debt Congress passed the measure with a deal Southern states opposed the plan because they had already paid debts - called others irresponsible Congress agreed to locate the new federal capitol in the South in return for passage of the plan

Establishment of a National Bank Bank would hold govt. funds Circulate uniform natl. currency Lend $ to the govt. To be privately owned & managed U.S. would have 20% ownership Wealthy biz interests - 80% Proposal caused huge debate

Bank of the U.S. Jefferson opposed the bank Not authorized in the Constitution Powers not granted to Federal govt reserved for states (soon-to-be 10th Amendment) States should charter banks A strict interpretation of the Constitution

Bank of the U.S. Hamilton invoked “necessary & proper” clause which allowed Fed to pass laws necessary for running govt. (Article 1, Sec. 8, par. 18) A loose interpretation GW accepted H’s argument and signed the measure into law Becomes a sectional rift - N vs. S Hamilton’s financial programs contributed to creation of political parties

Taxes Congress approved the proposal of an excise tax on whiskey An internal tax on production & consumption Falls hardest on Western PA farmers - distilled grain easier & cheaper to ship - brought in better $ Leads to a rebellion by PA farmers

Whiskey Rebellion Tax viewed as an undue burden & would benefit the wealthy Farmers refused to pay & threatened collectors 8/7/1794 - GW ordered the “rebels” to disperse & later ordered troops to PA

Whiskey Rebellion Organized rebellion evaporated with federal show of force - bloodless Several leaders arrested but pardoned to mend fences Demonstrated federal authority & defense of law Politically costly - Westerners throw support to Jeffersonian opposition

Effects of Hamilton’s Policies Nation’s credit firmly established Government revenue needs met Commerce & industry stimulated Govt. won support of influential businessmen & respect of the people Growing sectionalism Growing political division Federalists vs. Jeffersonian Repubs.