1. Unit 2

2. Chapter 4 Section 1

3. Creating a New Government  George Washington had to take the new constitution and turn it into a decent government  Cabinet – group of advisors to the President  Secretary of State – Thomas Jefferson  Secretary of the Treasury – Alexander Hamilton  Secretary of War – Henry Knox  Judiciary Act of 1789  13 District Courts, 3 Court of Appeals, Supreme Court  Chief Justice of the Supreme Court – John Jay

5. Creating a New Government  The Bill of Rights  James Madison was firm in wanting a Bill of Rights  Congress agreed on 12 Amendments and sent them to be ratified by the states  10 were approved by the states  1 – 8 amendments – protect the rights of individuals  9 – 10 amendments – set limits on the powers of the new national government

6. Creating a New Government  Who’s going to pay for this new government??  Financing the new government  Tariff of 1789 – James Madison’s Idea  Required importers to pay a percentage of the value of their cargo when they came to the US  Shippers had to pay a tonnage requirement  Who hates this tariff?????  SOUTHERNERS – High tonnage rates = more expensive shipping tobacco and rice to Europe  Also the imported goods that the South NEEDED would cost a lot more

7. Creating a New Government  Financing the Government  Hamilton’s Economic Plan  Supported the Tariff of 1789 but he believed the government should have the ability to borrow money  During the Revolutionary War the government had issued bonds  By 1789 the US owed $40 million to American Citizens, $11.7 million to France, Spain and the Netherlands  Bonds had fallen in value to 10 cents on the dollar  Hamilton wanted the Bonds paid at full value

8. Creating a New Government  Does everybody like Hamilton’s Plan?????  Opposition to Hamilton’s Plan  Madison and Southerners were upset because Northerners owned most of the bonds – the tax money used to pay off the bonds would come from the South  Compromise is in Sight!!  If the South would vote for Hamilton’s Plan then the United States’ capital would be moved from New York to a place along the Potomac River and it would be called the District of Columbia

9. Creating a New Government  The Bank of the United States  Hamilton’s Idea  Said the US needed a bank to manage its debts and interest payments  Bank would also issue paper money – provide a national currency  South does not like the idea of a bank  Said the North would own most of the bank’s stocks  Madison disagrees with the bank as well but for a different reason

10. Creating a New Government  The Bank of the United States  Enumerated Powers  Power that is specifically mentioned in the Constitution  Madison objected to the bank because of this  Implied Powers  Power that is not listed in the Constitution but is necessary for the government to do it’s job  Congress agreed to the bank  Hamilton pointed out Article I, Section 8 of the Constitution which gave the federal government the power ‘to make all laws which shall be necessary and proper to execute its responsibilities  Bank of the United States was created with a 20 year charter

11. Creating a New Government  The Whiskey Rebellion  Congress imposed a tax on the manufacture of Whiskey  Pennsylvania farmers and whiskey manufactures were MAD!!!!  Farmers terrorized tax collectors, stopped court proceedings, and robbed the mail  Washington sent 15,000 troops to stop the rebellion and the rebels gave up the rebellion without a fight

12. The Rise of Political Parties  Because of Hamilton’s financial plan Congress became divided based on their view of the federal government’s role  Federalists – Supported Hamilton (Federal)  Democratic-Republican (called Republicans in their day) (Modern Day Democrats) – Supported Madison and Jefferson

13. The Rise of Political Parties  Hamilton and the Federalists  Hamilton favored a strong federal government  Believed that democracy was dangerous to liberty  Believed manufacturing and trade were the basis of national wealth and power  Favored artisans, merchants, manufacturers, and bankers  Who was left out of this Party??

14. The Rise of the Political Parties  Jefferson and the Republicans  Thomas Jefferson emerged as the leader  Believed that the strength of the United States was independent farmers – Agrarianism (Ag)  Believed the wealthy would corrupt the government and threaten the rights and liberty of ordinary people  Stood for the rights of states against the federal government

15. The Rise of Political Parties  The two political parties dived the country regionally  Republicans – Rural South and West  Federalists - Northeast