1. G.W. and a New Government

2. Taking Shape
1st time a nation tried to base a government on Enlightenment ideals (republic beliefs and individual rights)
Many political decisions had to be made
How to raise revenue
How to provide for defense
“We are in a wilderness without a single footstep to guide us”

3. Judiciary Act of 1789 Creation of a Judicial system
Supreme court heads federal court system
Provided for a Supreme Court consisting of a chief justice and 5 other justices
Section 25: stated that state court decisions could be appealed to a federal court when constitutional issues were raised
“supreme law of the land”

4. Executive Branch
To help make policies and carry out laws passed by Congress
At 1st consisted of Pres. and V.P.
Created 3 departments (cabinet)
Department of state (foreign affairs)
Thomas Jefferson
Department of war (military matters)
Henry Knox
Department of treasury (manage finances)
Alexander Hamilton

5. Hamilton/Jefferson Debate
Hamilton – belief in a strong central government led by a prosperous, educated elite upper-class (supported in North)
Commerce and industry key to strong nation
Jefferson – favored strong state and local government (supported in South and West)
Farmer – citizen society

6. Hamilton’s Economic Plan
Set nation’s finances and get strong economic base
Plan to manage country’s debt and create national banking system
Report on the Public Credit
Debt was in the millions (why?)
National government was responsible for 2/3
Owed $ to other countries as well as for bonds
Proposed to pay foreign debt and issue new bonds
Nation to take over state debt (why?)
South was upset -> already paid most of their state debts

7. National Bank
Funded by federal government and wealthy private investors
Bank of the United States would issue paper money and handle tax receipts
James Madison argues unhealthy alliance between the government and wealthy business interests
Plus constitution did outline plan for National bank
Began controversy of “strict” vs. “loose” interpretation
Article 1, Section 8, Clause 18 = elastic clause

8. District of Columbia
Hamilton suggests moving capitol from NYC to more southern city (why?)
Madison/Jefferson liked idea
Believed it would help government be more responsive to Southern interests
Capitol moved to District of Columbia between Virginia and Maryland