Transcript Launching the New Ship of State, 1789-1800 I

Launching the New Ship of
State, 1789-1800
I shall only say that I hold with Montesquieu, that a
government must be fitted to a nation, as much as
a coat to the individual; and, consequently, that
what may be good at Philadelphia may be bad at
Paris, and ridiculous at Petersburg (Russia).
Alexander Hamilton, 1799
A New Ship on an Uncertain Sea
• The new Constitution was
launched in 1789. The
population was doubling
every twenty-five. By 1790,
there were about 4 million
people.
• America’s population was
still about 90% rural and all
but 5 % lived east of the
Appalachian mountains.
• Kentucky, Tennessee, and
Ohio were the main
overflow areas west of the
Appalachian Mountains.
• Many people, especially
those in the western states,
were very cautious about a
strong central government.
• Finances of the new
government was in
disarray: the national debt
was enormous and the
paper money was
practically worthless.
• Much of Europe viewed the
new country with caution,
fearing that a similar
revolution could erupt
within their own borders.
Washington’s Profederalist Regime
• George Washington was
unanimously-drafted as
president of the United
States by the electoral
college (members
selected by the state
legislatures to cast their
vote for president).
• New York was the
temporary capital-for the
United States.
• Washington established the first
cabinet. The Constitution does
not mention a cabinet; it merely
provides that the president “may
require” written opinions of the
heads of the executive-branch
departments. Being burdensome,
Washington instituted cabinet
meetings. (Adams was V.P.)
• Thomas Jefferson became the
Secretary of State; Alexander
Hamilton became the secretary of
treasury; and Henry Knox
became the secretary of war.
The Bill of Rights
• Many anti-federalists had
sharply criticized the
Constitution drafted at
Philadelphia for its failure
to provide guarantees of
such as freedom of
religion and trial by jury.
Many states had
approved the Constitution
under the understanding
that a bill of rights would
be added.
• Amendments could be Proposed in two ways and
Ratified in two ways.
Proposed
Ratified
2/3 Congress
3/4 State Legislature
2/3 National Convention 3/4 State Legislature
(when requested by 2/3 states)
2/3 Congress
3/4 State Convention
2/3 National Convention 3/4 State Convention
(when requested by 2/3 states)
• Bill of Rights: Freedom of
religion, speech and
press; the right to bear
arms and to be tried by a
jury; the right to assemble
and petition the
government; prohibits
cruel and unusual
punishment, prohibits
unlawful seizure of
property
• James Madison drafted
the Amendments and
proposed them through
Congress.
• Ninth Amendment -any
right not given to states or
national government goes
to the people
• Tenth Amendment -any right not
given to the national government
nor denied to the states goes to
the states. This was intended to
pacify the antifederalist’s view of
strong central government.
• Congress created the federal
courts under the Judiciary Act of
1789. This act organized the
Supreme Court, with a chief justice
and five associates, as well as
federal district and circuit courts
(courts of appeals). John Jay, the
New Yorker who helped write the
Federalist Papers became the first
chief justice.
• The office of attorney general was
established (the government’s
legal advisor and representative).
Hamilton Revives the Corpse of
Public Credit
• Hamilton set out immediately
to correct the economic
problems that had crippled
the Articles of Confederation.
• Hamilton’s plan was to favor
the wealthier groups. They,
in turn, would lend the
government monetary and
moral support.
• Hamilton believed that if the
wealthy were protected and
allowed to prosper, then
prosperity would trickle down
to the masses.
• Hamilton wanted to
establish the national credit.
He urged Congress to
“fund” the entire national
debt “at par” (pay off debts
at face value, plus
accumulated interest) and
to assume completely the
debts incurred by the states
during the war.
• Many did not believe the
infant Treasury was capable
of meeting these obligations
that government bonds had
depreciated. However,
“speculators” (investors)
bought enormous amounts
from farmers, war veterans,
and widows.
Customs Duties and Excise Taxes
• Hamilton is often known as “Father
of the National Debt.” He believed
that a national debt was a “national
blessing”. The more creditors to
whom the government owed
money, the more the people would
take a personal stake in the
success of the national
government. He wanted to turn a
debt (a liability) into an asset (a
plus) in order to vitalize the
financial system as well as the
government itself.
• The more people
depended upon the nation,
the stronger the federal
government would be.
• Where was the money to
come from?
– Customs duties (tariffs)passed by Congress1789. This would raise
money plus protect the
infant industries.
– Excise Tax (tax on
products made within
the country) primarily
whiskey. Whiskey was
so prominent on the
frontier, that it was used
for money.
Hamilton Battles Jefferson for a
Bank
• In order to strengthen Hamilton’s
financial system he proposed a
Bank of the United States. Hamilton
admired most things English while
Jefferson admired most things
French. Hamilton modeled his bank
after the Bank of England.
• Hamilton proposed a powerful
private institution, of which the
government would be the major
stockholder and in which the federal
Treasury would deposit its surplus
monies.
• The bank would print
paper money, thus
providing a sound and
stable national currency
by keeping money
circulating in the treasury.
• Jefferson felt that the
bank was unconstitutional
since the Constitution did
not authorize such a
financial institution.
• Jefferson believed that all powers
not specifically granted to the
central government were thus
specifically granted to the states.
He believed that the states not the
federal government had the power
to charter a bank.
• Jefferson and his states’ rights
followers believed that the
Constitution should be interpreted
“literally” or “strictly,” thus the
theory of “strict
constructionism.”
• Hamilton believed that what the
Constitution did not forbid-it
permitted (loose constructionist)
• Hamilton invoked the
“necessary and proper clause”
of the Constitution (Art. I, Sec.
VIII, Para. 18). Since a national
bank was necessary in order for
the nation to function, it was also
proper to create.
• Hamilton believed that the
Constitution should be
interpreted “loose” or “broad”
thus he and his federalist
followers evolved the theory of
“loose construction” by
evoking the “elastic clause” of
the Constitution. This created a
precedent for enormous
federal powers.
• Hamilton’s views prevailed.
The most support for the
bank came from the
commercial and financial
centers of the North,
whereas the strongest
opposition arose from the
agricultural South.
• The Bank of the United
States, was created by
Congress in 1791, and was
given a 20 year charter. It
was to be located in
Philadelphia. Stock
(bonds) was then open to
public sale.
• The government would sell
bonds which would put
money into the treasury.
Private citizens would earn
interest on their money
Mutinous Moonshiners in
Pennsylvania
• The Whiskey Rebellion,
which flared up in
southwestern Pennsylvania
in 1794, sharply challenged
the new national
government.
• Defiant distillers in the west
reacted violently to the
Excise tax imposed on
whiskey. They erected
liberty poles, much like the
liberty poles of the antistamp tax days in 1765 and
cried, “Liberty and No
Excise.”
• Washington with Hamilton’s
encouragement rounded up
13,000 troops from other
states to crush the rebellion.
Though the Whiskey
Rebellion was minuscule, its
consequences were mighty.
The new government was
now substantially
strengthened and
commanded a new respect.
• Foes of the federalists
condemned the
administration for its brutal
display of force-for having
used a sledgehammer to
crush a gnat.
The Emergence of Political parties
• Hamilton’s fiscal policies had
created a sound credit rating. The
Treasury could now borrow
needed funds in the Netherlands.
• Hamilton’s financial successes
created political problems among
the “state-righters.”
– Assuming the national and
state debts
– The excise tax
– The Bank of the United States
– Suppression of the Whiskey
Rebellion
– Tariffs
• What was once a personal
feud between Hamilton and
Jefferson, now developed
into a full-blown and
frequently bitter political
rivalry.
• National political parties
were unknown in America
when George Washington
took his inaugural oath.
There had been Whigs and
Tories, federalists and
antifederalists, but these
were factions rather than
parties. When their cause
faded, they faded.
• The Founding Fathers had
distrusted the creation of political
parties thinking that they would
split the Union apart.
• At first, Jefferson and Madison
organized their opposition to the
Hamiltonian program within
Congress only. However, the
differences between Jefferson
and Hamilton emerged into two
national political parties.
Ironically, political parties have
come to bring compromise
instead of disastrous factions.
• Hamilton felt that if the federal government
was to assume all the debts of the states,
then the states would be bound tightly to
the federal government. Also, this
maneuver would shift the attachment of
wealthy creditors from the states to the
federal government. The support of the rich
to the national government was crucial to
Hamilton’s strategy of strengthening the
central government.
• Virginia, who had small debts did not like
Hamilton’s idea. Hamilton proposed the
District of Columbia to be located on the
Potomac River (Virginia and Maryland).
• Jefferson, a Virginian, was persuaded to
vote for this plan and the vote was carried
through in 1790.
The Impact of the French
Revolution
• By the end of Washington’s
first administration, there had
emerged two political parties:
Jeffersonian DemocraticRepublicans and
Hamiltonian Federalists.
Foreign policy was to make
the gap wider.
• A few weeks after
Washington's inauguration in
1789, the French Revolution
broke out. This conflict
turned into a world war. At
first, the American people
cheered the overthrow of
despotism.
• In 1792, the French
Revolution enlarged
when France declared
war on Austria. In 1793,
the king was beheaded,
the Church was attacked,
and the Reign of Terror
had begun.
• Britain was eventually
drawn into the conflict,
thus spreading to
America.
Washington’s Neutrality Proclamation
• The Franco-American alliance of
1778 was still strong in the minds of
Americans and the French. Many
Jeffersonian DemocraticRepublicans favored honoring the
alliance and help to defeat Britain.
• Both Hamilton and Washington
perceived that war had to be
avoided at all costs. The nation in
1793 was militarily, economically,
and politically weak.
• Washington felt that if America
could avoid war for a generation or
so, it would be populous enough
and powerful enough to assert its
maritime rights with strength and
success. Both Hamilton and
Jefferson agreed on this point.
• Washington issued the
Neutrality Proclamation in
1793. This proclaimed that the
United States would remain
neutral. It sternly warned
American citizens to be
impartial toward both England
and France. This proclamation
began a long tradition of
isolationism that was to be
America’s signature mark for
a long time to come.
• The pro-French Jeffersonian’s
were enraged by the
Proclamation. The pro-British
Federalists were heartened.
• French Republic, Citizen
Edmond Genet -a
representative of the French
Republic was replaced by
Washington for overstepping
his boundaries in trying to
recruit America against the
English and Spanish. Genet
thought that the sentiment of
the American people were
for the French.
• In 1778, both France and
America had much to gain;
now in 1793 only France had
anything to gain
Embroilments with Britain
• Britain had been defying the
Treaty of 1783 and had retained
its chain of northern frontier
posts on U.S. soil. London did
not want to abandon the
lucrative fur trade. British agents
openly sold firearms to the
Indians who continued to attack
pioneers. When General “Mad
Anthony” Wayne crushed the
northwest Indians at the Battle
of Fallen Timbers on August
20, 1794, the Americans found
British-made arms and corpses
of a few British-Canadians.
• The Treaty of Greenville in
1795, the Indians, finally
abandoned the vast region of
the Ohio country.
• On the seas, the British wanted
to starve out the
• French West Indies and expected
the United States to defend them
under the Franco-American
alliance of 1778. Britain seized
about 300 American merchant
ships in the West Indies and
impressed scores of seamen into
service on English vessels, and
threw hundreds of others into
dungeons.
• The Jeffersonians (DemocraticRepublicans) wanted to attack
Britain. At least, cut off all
supplies to Britain through an
embargo.
• The Federalists resisted all
demands for drastic action. War
with Britain would be lethal to
the Hamiltonian financial
system.
Jay’s Treaty and Washington’s
Farewell
• Washington sent Chief Justice John Jay
to London in 1794. The British promised
to evacuate the chain of posts on U.S.
soil; Britain would pay damages for
recent seizures of American ships (but
did not promise a halt in future
seizures); and did not stop from
supplying arms to Indians.
• The United States had to pay the debts
still owed to British merchants on preRevolutionary accounts. Part of this
was Hamilton’s doing to avoid war with
Britain.
• The Jeffersonians were furious. This act
by John Jay vitalized the newborn
Democratic-Republican party.
• Spain, thinking that an alliance might
be in the making, forged a treaty with
the United States. Known as the
Pinckney Treaty of 1795, Spain
granted the Americans free
navigation of the Mississippi and
territory north of Florida.
• After two terms, Washington decided
to retire, thus setting the long held
tradition of a two term president.
• In Washington’s Farewell Address, he
advised the avoidance of permanent
alliances like the French Treaty of
1778.
• Washington’s term proved to be very
important: the central government
was solidly established, its fiscal
(money) policy firm, the West was
expanding, the merchant marine
(civilian shipping) and most of all,
Washington had kept the nation out of
both overseas entanglements and
foreign wars.
John Adams Becomes President
• Who would become the next
president. Alexander
Hamilton, the best-known of
the Federalist party, had
become unpopular over his
financial policies.
• The campaign of 1796 was
intense.
• The Federalists turned to
Washington’s vice president,
John Adams.
• The Democratic-Republicans
chose Thomas Jefferson.
• The Democratic-Republicans
brought up the too-forceful
crushing of the Whiskey
Rebellion and the negotiation
of the despised Jay Treaty.
• John Adam’s support was
primarily in New England
while Jefferson’s support
was from the South and
Western states. Adams
narrowly won. Jefferson
became vice president (this
can not happen today).
• Adams, who came across
without good social skills was
hated by Hamilton who had
organized the war minded
“High Federalists.”
• Adams had inherited a
volatile situation with France.
Unofficial Fighting with France
• The French were infuriated by Jay’s Treaty. They looked at it
as an alliance with England and as a violation of the FrancoAmerican Treaty of 1778.
• French warships, in retaliation, began to seize American
merchant vessels.
• When the French would not receive our ambassador, Adams
sent three men, including John Marshall (future chief justice).
• The three American ambassadors were met by three
unidentified men later referred to as X, Y, and Z. The French
minister Talleyrand would not meet with the American
ambassadors but issued a bribe for them to speak with him.
Negotiations broke down, and John Marshall returned to New
York, the temporary capital. America was swept with war
fever, “Millions for defense, but not one cent for tribute.”
• The Federalists wanted war with France while the
Jeffersonians did not want war.
• The Navy Department was created as well as the United
States Marine Corps.
• Most of the fighting was in the West Indies (1798-1800).
Adams Puts Patriotism Above Party
• France did not want war with America since it was already
fighting in Europe. Britain was lending Americans cannon and
other war supplies.
• The Federalists wanted war. Adams, however knew that the
young country could not chance a war with France.
• Adams, instead sent a new minister to France to work out
tensions. Hamilton and his war-hawk faction were enraged.
• The “Little Corporal,” Napoleon Bonaparte was now in power.
He did not want war with America so he could concentrate on
his war in Europe.
• The Convention of 1800 was signed in Paris. France agreed
to annul the twenty-two year-old Franco-American treaty of
1778; America had to pay the damage claims by American
shippers.
• Adams had not only avoided war but smoothed the path for
the peaceful purchase of Louisiana three years later.
The Federalist Witch Hunt
• The Federalists in Congress drove through the “Alien and Sedition Acts in
1798. These acts were primarily made to hush up the DemocratRepublicans.
• The Alien Acts were to increase the time to become citizens from five
years to fourteen. This was to keep the new immigrants from siding with
Jefferson’s Democratic-Republicans. The president was also empowered
to deport dangerous foreigners in time of peace and to deport or imprison
them in time of hostilities.
• The Sedition Act curtailed two priceless freedoms guaranteed in the
Constitution by the Bill of Rights -freedom of speech and freedom of the
press. This law stated that anyone who impeded the policies of the
government or falsely defamed its officials, including the president, would
be liable to a heavy fine and imprisonment. Many outspoken Jeffersonian
editors were indicted under the Sedition Act.
• Matthew Lyon (the “Spitting Lion”) was failed for four months for writing
against President Adams.
• The Sedition Act was in direct conflict with the Constitution. However, the
Federalist of the Supreme Court ruled in favor of it.
The Virginia (Madison) and
Kentucky (Jefferson) Resolutions
• Jeffersonians feared that the Alien and Sedition Laws could undermine
basic freedoms of Americans.
• Fearing prosecution for sedition, Jefferson secretly penned a series of
resolutions, which the Kentucky legislature approved in 1798 and 1799.
His friend and fellow Virginian James Madison drafted a similar one that
was adopted by the Virginia legislature in 1798.
• Both Jefferson and Madison stressed the compact theory. The thirteen
sovereign states, in creating the federal government, had entered into a
“compact,” or contract regarding its jurisdiction. The national government
was consequently the agent or creation of the states. The states were the
final judges of whether the government had broken its “compact.” If so,
the states could nullify the law.
• The Federalists argued that the people, not the states, had made the
original compact, and that it was up to the Supreme Court-not the states
to nullify unconstitutional legislation passed by Congress.
• The Virginia and Kentucky resolutions were a brilliant formulation of the
extreme states’ rights view regarding the Union.
• The southerners would ultimately use this to secede from the Union.
Federalists versus DemocraticRepublicans
• By the 1800 election, the differences between Federalists and
Democrats were clear. (1793-1800)
• Federalists-Adams, Hamilton
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Rule by the “best people”
Hostility to extension of democracy
A powerful central government at the expense of states’ rights
loose interpretation of Constitution
Government to foster business; concentration of wealth in interests of
capitalistic enterprise
A protective tariff
Pro-British (conservative Tory tradition)
National debt a blessing, if properly funded
An expanding bureaucracy
A powerful central bank
Restrictions on free speech and press
Concentration in seacoast area
A strong navy to protect shippers
continued
• Democratic-Republican (Jefferson, Madison)
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Rule by the informed masses
Friendliness toward extension of democracy
A weak central government so as to conserve states’ rights
strict interpretation of Constitution
No special favors for manufacturers
Pro-French (radical Revolutionary tradition)
National debt a bane; rigid economy
Reduction of federal officeholders
Encouragement to state banks
Relatively free speech and press
Concentration in South and Southwest; in agricultural areas
and backcountry
– A minimal navy for coastal defense