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Washington’s Cabinet
Secretary of War: Henry Knox.
The War Department would oversee the defense of the nation
State Department: Secretary of State, Thomas Jefferson.
The State Department oversees relations between the U.S. and other nations
Washington’s Cabinet
Secretary of the Treasury: Alexander Hamilton
The Treasury Department manages the government's money.
Attorney General: Edmund Randolph
The Attorney General to advise the government on legal matters.
Federal Judiciary Act of 1789
Gave the court six justices - that's five associates and one chief justice.
established other lower federal courts.
Washington appointed John Jay as the court's first Chief Justice
Today, the court has been increased to nine justices.
Dealing with Debt
Alexander Hamilton inherited the problem of the huge war debt.
By 1789, it was $52 million.
Hamilton and the other leaders knew that the debt had to be paid to gain the respect of foreign nations.
Believing in a strong central government, Hamilton had a plan.
Dealing with Debt
Hamilton felt that the US’s economy would depend on rich merchants and manufacturers.
Knew they needed to pay them back. In 1790 he proposes the plan to Congress:
Pay off all war debts
Raise government revenues
Create a national bank
Dealing with Debt
Hamilton wanted the federal government to pay the states' war debt, but those states which had already paid theirs (Virginia, Georgia and other Southern states) didn't like the idea of covering the Northern states' debt.
To gain support, Hamilton got help from his political rival Thomas Jefferson.
Compromise
Hamilton and Jefferson reached a compromise.
The South would support the plan to repay the debt, but the North agreed to move the capital to the South on the Potomac River between Maryland and Virginia -- Washington D.C..
Hamiltonian View
Hamilton’s views differed from Thomas Jefferson, who saw the US developing into an agrarian society.
Hamilton argued that agriculture didn’t employ the workforce available, that industry would help to attract immigrant workers and that diversification of the economy would greatly strengthen the nation’s ability to prosper.
He advocated the use of women and child labor and protective tariffs.
Hamiltonian View
Hamilton believed that the US could never be completely free from Britain as long as it was dependent on foreign goods.
In December 1791, he submitted this report which argued the importance of the federal government stimulating the economy.
Activities would include implementation of tariffs, granting subsidies, attracting foreign skilled workers and adopting new technological innovations
Hamiltonian View
It is Alexander Hamilton and his assistant secretary of the treasury, Tench Coxe, who collaborated on the formation of SUM (Society for Useful Manufacturers) in Paterson.
Coxe wanted to put into use a patent that he acquired for an improvement to Arkwright spinning machine (the first machine to spin several strands of cotton with the need of a skilled operator).
Hamiltonian View
Hamilton and Coxe wrote a prospectus for SUM, which expounded on Hamilton’s arguments for manufacturing more finished products by corporations.
It called for the establishment of a manufacturing town supported by private investments that would produce everything from linens to paper to cotton cloth to beer.
National Bank
For raising revenue, Hamilton was in favor of tariffs.
A tariff is a tax on imported stuff. It brings in money and encourages people to buy American products.
Hamilton called for the creation of a national back to have a safe place for the government to keep money, to make loans to businesses and government and to issue paper money.
This plan would strengthen the central government.
National Bank
Jefferson was not happy about the idea of a national bank.
Both Thomas Jefferson and James Madison had a narrow, strict interpretation of the Constitution.
They said the Constitution did not authorize the federal government to set up a bank.
National Bank
Hamilton believed in a loose interpretation of the Constitution.
In Article 1 of the Constitution, it states that 'necessary and proper' steps may be taken to carry out the needs of the government
Hamilton believed that a bank was 'necessary and proper'.
Hamilton and Jefferson brought their cases to President Washington. Hamilton won this one.
The Bank of the United States was established in 1791.
Whiskey Rebellion
Hamilton came up with another way to help pay off war debts – a 25% excise tax on all of the liquor sold in the United States.
An excise tax is a tax on the sale or use of a product.
Farmers in the western areas of all states south of New York because they relied on producing whiskey to make a living.
Whiskey Rebellion
By 1794, tax collectors sent to Western Pennsylvania were tarred and feathered, making it impossible to collect the whiskey tax there.
In June, local officers ordered the leaders of the whiskey tax rebellion arrested, but this just caused violence.
A month later, the commander of the local militia was shot and killed by federal troops. The troops were defending a tax official.
The farmers burned down the buildings owned by the tax official.
Whiskey Rebellion
Washington called up a militia from several states. He put on his old uniform from the Revolution and led the army of over 12,000 troops himself, ending the rebellion with no bloodshed.
Rebels saw this overwhelming force commanded by General Washington himself and they instantly dispersed.
President Washington pardoned the rebels so there was no bad feelings.
The outcome of the Whiskey Rebellion showed the supremacy of the federal government, but it did make people wary of the government's power.
Works Cited
George Washington and the New United States Government
Study.com
The Whiskey Rebellion and Battle of Fallen Timbers Study.com