1. STARTER
How did Jefferson’s and Hamilton’s views of government differ?

2. Washington, Hamilton, Domestic Problems

3. Hamilton’s Economic Plan
Proposed a plan to manage the country’s debts (2/3 of war cost)
Plan to established a national banking system
Proposed to pay off foreign debts
Proposed the federal government assume the debts of the states
Hamilton’s reasoned that assuming state debts would give creditors an incentive to support the new federal government
But if the government failed creditors would not regain the funds that was borrowed.

4. HAMILTON’S ECONOMIC PLAN
Hamilton wanted a National Bank fully funded by the Government
Opponents, like James Madison, felt the Constitution made no provisions for such a Federal bank
Thus begins a long battle between those who interpret the Constitution loosely vs. strictly

5. TWO-PARTY SYSTEM
Differences within Washington’s cabinet gave rise to a Two-Party System
Supporters Hamilton’s strong government view called themselves Federalists
Supporters of Jefferson’s vision of a strong state government were called Democratic-Republicans

6. The Whiskey Rebellion
During Washington’s 2nd term, an event occurred that showed the tension between federal and regional values.
In 1789 Congress had passed a protective tariff (tax on imported goods, luxury items) and an excise tax on the manufacture of whiskey.
Since whiskey is made from corn, farmers were hurt the most by the new tax.

7. Whiskey Rebellion Congress lowered the taxes
The “Whiskey Boys” however began tar and feathering tax collectors
Washington sent 13,000 troops to put down the rebellion
It worked!!