Steering the Course

1. Steering the Course Chapter 10: Launching the New Ship of State 1789-1800

2. Major Issues Faced by the New Federal Government • representing “We the People” • managing the national government’s money • managing “We the People” • foreign affairs • political parties • states’ rights

3. Representing “We the People”

4. Representing “We the People” George Washington was unanimously elected by the Electoral College.

5. Representing “We the People” • Washington selected the first Presidential “cabinet” (group of advisors): • Secretary of State Thomas Jefferson • Secretary of the Treasury Alexander Hamilton • Secretary of War Henry Knox

6. The First Presidential Cabinet Knox Jefferson Hamilton

7. Representing “We the People” • The First Congress immediately set to work and passed the Bill of Rights (first ten amendments to the Constitution) which established guarantees of individual rights, protection from arbitrary acts of government, and established the concept of states’ rights.

8. Representing “We the People” • Congress also passed the Judiciary Act of 1789 which created the Supreme Court, lower courts and office of Attorney General. Art Credit: “The Honourable Sir Joseph Walton,” Vanity Fair Print (Spy Cartoons), 1909 http://www.antiquemapsandprints.com/SCANSD/D-1957.JPG

9. Managing the National Government’s Money

10. Managing the National Government’s Money Secretary of the Treasury Alexander Hamilton established the following fiscal policy: • government bonds would be paid at full value • the national government assumed (took over) debts owed by the States **This resulted in the creation of a large national debt.**

11. Managing the National Government’s Money Hamilton believed that debt was an asset – that creditors have a “personal stake” in the success of the debtor. Debt is good?

12. Managing the National Government’s Money • The government raised money through • customs duties derived from tariffs • excise taxes (taxes on domestic goods)

13. Managing the National Government’s Money Hamilton felt it was appropriate for Congress to establish a national bank (the Bank of the United States). Article I, Section 8, Clause 18 of the Constitution states that government may do whatever is “necessary and proper” to carry out its expressed powers. The Elastic Clause!

14. Managing the National Government’s Money Hamilton’s view was that if the government could coin money and collect taxes, it would be “necessary and proper” for the national government to create a bank. Thomas Jefferson and the States passionately disagreed! The future of the national bank will be “shaky.”

15. Managing “We the People”

16. Managing “We the People” • Taxation did not agree with “we the people.” • Backwoods farmers in Pennsylvania refused to pay their whiskey excise taxes and “tarred and feathered” revenue officers who attempted to collect the taxes.

17. Managing “We the People” Uncertain of who would respond, Washington summoned the state militias. The force that showed up “dispersed” the “rebellion.” So many showed up that it has been said that Washington “used a sledgehammer to crush a gnat.”

18. Managing “We the People” • The significance of the “Whiskey Rebellion” is that • State militias will answer a national call, and • a new respect is established for the power of the national government.

19. Political Parties

20. Political Parties The “two-party” history in this country has roots in the Revolutionary era “Whigs” and “Tories.” This system evolved during the ratification of the Constitution with the “Federalists” and the “Anti-Federalists.” A personal feud between Hamilton and Jefferson further evolved into two political camps, the “Federalists” and the “Jeffersonians.”

21. Political Parties • Though “third” parties often form, they usually have a single issue focus and are short lived. • The party system gives the “common man” a voice in government and allows people to feel comfortable voicing their opinions. • Competition ensures sound democracy.

22. Foreign Affairs

23. Foreign Affairs The French Revolution, which began as Washington was taking office, erupt into a “continent-wide” war. President Washington issued a declaration of neutrality (the Neutrality Proclamation of 1793) and warned Americans to be impartial. He feared that the economy of the U.S. was too fragile to participate in a foreign war.

24. Foreign Affairs Though damaging to foreign relations between the U.S. and France, neutrality conveniently aided American merchants as neutral nations are allowed to trade with “both sides.” Washington’s farewell address after his 2nd term advised the avoidance of “permanent alliances.” Washington encouraged isolationism – keeping to ourselves and avoiding foreign entanglements.

25. Foreign Affairs Britain continued to defy the Treaty of Paris of 1783. They maintained forts in surrendered territory, traded arms to natives and began to seize American merchant ships and impress sailors into British naval service.

26. Foreign Affairs • Federalists felt that war would harm the fragile financial system, but Jeffersoniansclamored for war. • Chief Justice John Jay was sent to England to negotiate.

27. Foreign Affairs England consented to pay damages on seized merchant ships but demanded that the U.S. pay pre-Revolutionary war debts. • Jay’s Treaty was seen as an “alliance” with Britain. • Jay was branded a “traitor” by Jeffersonians and executed in effigy.

28. Foreign Affairs The French were offended at this “alliance” and also began seizing American ships. After John Adams was elected President in 1796, he sent a commission to France to smooth things over.

29. Foreign Affairs The commission was approached by French agents “X,” “Y” and “Z” who demanded $250,000 to set up a meeting with the French foreign minister. They also demanded the promise of loans to France. The commission returned home in indignation (unhappy). XYZ!

30. State’s Rights

31. States’ Rights • The election of 1796 resulted in the narrow margin election of Federalist John Adams as President and Anti-Federalist Thomas Jefferson as Vice President. Congress was controlled by the Federalists. • The Federalists were seen as the “rich people’s” party, while the Jeffersonians were seen as the party for the “common man.”

32. States’ Rights New immigrants to the U.S. were more attracted to the Jeffersonian Party. The Federalists feared the rapid growth of that Party and losing control in government.

33. States’ Rights The Federalist controlled Congress passed a series of “Alien Acts,” one of which raised residency requirements for citizenship from 5 years to 14 years. This would delay the addition of immigrants to the Jeffersonian party.

34. States’ Rights The Sedition Act of 1798 restricted free speech and free press – in direct contradiction to the Constitution – and was used to silence outspoken Jeffersonians. This law was conveniently written to expire in 1801 just in case the Federalists lost power in the election of 1800.

35. States’ Rights The States of Virginia and Kentucky each passed resolutions stating that they would not follow the Alien and Sedition Acts on the grounds that they were unconstitutional. These actions asserted the States’ rights to nullify (make void) national legislation when the States felt that the government had exceeded its authority.

36. States’ Rights The Kentucky and Virginia Resolutions marked the beginning of a series of very heated debates regarding the power of the national government versus the power of the State governments. This issue will never be fully resolved.