Transcript The First Federal Government

The “Federal” Government
Our first federal government
Members of Congress Arrive
The Eleven Pillars
New York, not Washington
Government on Wall Street
The Imperial Presidency
Electoral College
The First Executive Branch
What’s in a name?
• The President of the
United States
• Huh?
Creation of the Executive
The Cabinet
• Madison called for the
creation of an executive
branch consisting of
four cabinet positions.
• Trouble? It wasn’t in
the Constitution—a
common problem we
will see.
• State. War. Treasury.
Attorney General.
The Cabinet
Alexander Hamilton and the
Treasury
• "digest and prepare
plans for the
improvement and
management of the
revenue, and for the
support of the public
credit"
The Judiciary
Judiciary Act of 1789
• "The judicial Power of
the United States, shall
be vested in one
supreme Court, and in
such inferior Courts as
the Congress may from
time to time ordain and
establish."
Creation of Courts and Outlining Crime
• Punishment of Crimes
Act: outlined “Federal
Crimes”
Amending the Constitution
Madison and Jefferson
• Had to consider 200
plus amendments to
the Constitution from
State ratification
conventions.
• "the legal check which
it puts into the hands
of the judiciary."
Not All Pleased?
• Robert Grayson on the
Bill of Rights:
• "good for nothing & I
believe as many others
do, that they will do
more harm than
benefit."
•
A Revenue System
The Second Bill
• Regionalism and
sectionalism
emerge…who can tax?
The First Lobby?
• Individuals engaged in
manufacturing, especially
those in the major ports of
Boston, New York,
Philadelphia, Baltimore,
and Charleston, sought
duties high enough to
discourage the importation
of foreign goods that might
compete with those made
in America.
Regionalism
• Southerners in general
opposed using imposts to
protect American
manufactures. In this letter
Baldwin is critical of the
Senate's changes in the
Impost Bill, saying: "These
protections and
commercial regulations
will surely lead us a wild
dance."
The Capital
• No issue so threatened the fragile American Union as the question of
where to locate its capital city. In 1783, in recognition of the sectional
division of the Union, Congress decided to have two capitals, one on
the Delaware River near Trenton and the other on the Potomac. A
year later Congress voted to establish a single federal town near
Trenton and to meet in New York City until buildings at the capital
were completed. Southerners blocked appropriations for the
construction. Consequently, Congress remained at New York City
despite repeated efforts by the Pennsylvanians and Southerners to
bring them back to Philadelphia, the seat of Congress from 1774 to
1783.
• Late in August 1789 the First Congress took up the question of
locating the federal capital. After a bitter debate between
representatives from north and south of the Mason-Dixon Line, the
House agreed to a bill retaining New York City as the temporary
residence and locating the permanent capital on the Susquehanna
River in Pennsylvania. Most representatives expected Wright's Ferry,
renamed Columbia in 1788, to be the specific site. Instead the Senate
named Germantown, seven miles north of Philadelphia. At the last
minute, Madison managed to have the bill postponed until the
second session.
The Spot and the “Deal”
Funding the Debt
Debt
• "All Debts contracted and
Engagements entered into,
before the Adoption of this
Constitution, shall be as
valid against the United
States under this
Constitution, as under the
Confederation."
• The Confederation Congress
had lacked sufficient revenue to
pay the foreign and domestic
debts that had accumulated to
more than 54 million dollars by
1790. Some Americans,
especially those to whom the
federal government was
indebted, believed that
provision for the public credit
should be one of the first issues
to be dealt with during the first
session of the First Federal
Congress.
Hamilton
• Alexander Hamilton had long
been an advocate of a stronger
federal government with
sufficient powers to establish
public credit and he believed the
government should fund the
debt, instead of immediately
paying it off. Although several
of his contemporaries had more
experience in financial matters,
Hamilton's appointment was
widely acclaimed and great
things
Report on Manufactures and Credit
• Congress assigned Hamilton a complex task, but for almost
a decade both he and the Confederation Congress had
given considerable thought to the issues involved. In this
report he proposed to fund the debt rather than pay off the
principal as rapidly as possible. This meant creating from
federal revenues a fund set aside to make regular and long
term payments of the interest on the debt. To make the
bookkeeping more manageable, new debt certificates would
be printed to consolidate the various types of certificates
issued during the Revolutionary War. In addition, he
supported the assumption of the state debts, the creation of
an excise to pay the costs of the assumption, and the
establishment of a national bank.
Hamilton
• Hamilton's masterful report met with quick
endorsement from most members, but James
Madison led the opposition to two of his
proposals. Madison favored discriminating
between the original holders of the debt (for
example, soldiers and those who had loaned
Congress money) and holders who had
purchased the certificates at less than face
value.
Assumption and Wealth
Hamilton’s Economic Plan
• Report I: Report on the Pubic Credit
• Dealt with funding and assumption of debts
from the Revolution.
• Bond sales
• Total debt: 11.7 million to foreign governments.
44.4 million domestic debts.
• Holders of debt certificates (many had been sold
by the poor/revolutionary soldiers) could turn
them in for a bond valued at 4% annually.
Debt assumption
• Domestic program, very
controversial…members of congress even
swooped in and bought up the debt
certificates!
• War debts were a difficult subject as some
state governments had little or no debt
(south) where as some had large debt (north)
• The ‘deal’.
First BUS
• Part of Report 2
• Outlined the need for a
bank, taxes and
regultion of trade.
Report on the Mint
• Dealt with the weight and value of
American coinage.
Report on Manufactures
• Called for a diverse, mixed economy with
manufacturing, commercial, and farming
sectors.
• Advocated high tariffs, highly unpopular.
• The least successful of his initiatives.