Hamilton v. Jefferson
GEORGE WASHINGTON'S CABINET
Thomas Jefferson - Secretary of State
Alexander Hamilton - Secretary of the Treasury
Henry Knox - Secretary of War
Edmund Randolph - Attorney General
HAMILTON'S FINANCIAL PROGRAM
Make U.S. a major commercial power
By imposing tariffs (Tariff of 1789)
And giving government subsidies to industries.
Creating U.S. reputation as a credit-worthy nation
By assuming state debts ("assumption")
And creating a national debt that the U.S. would slowly but reliably pay off.
Confederate Congress owed $40 million to American citizens and $11.7 million to France, Spain, Netherlands.
Continental dollars had dropped in value - Federal government redeemed them at full value (which favored speculators who had bought the bonds from desperate veterans and farmers for pennies on the dollar)
Create a national Bank of the United States
The bank would be owned by private investors who would then have a stake in America's economic stability.
Justified by the "necessary and proper" clause of the Constitution (Article 1, Section 8)
"loose constructionist" interpretation - "implied powers"
Said a national bank was necessary to collect taxes, regulate trade and provide for common defense (all duties enumerated/listed in the Constitution)
Tax producers of whiskey and other spirits (Taxed in 1791)
Excise tax paid by producers rather than consumers.
Making U.S. a military power
By creating a national army to deal with domestic uprisings like Shays's Rebellion
OPPOSITION TO HAMILTON'S PLAN
Opponents mostly from agricultural South
Supported by Jefferson and Madison
Opposed protective tariff because helped New England and hurt farmers (who had to buy manufactured goods)
Anger over payment of bonds at full value
Which favored speculators and unfair to original buyers of the bonds.
Upset because Northerners owned most of the bonds.
Anger over assumption
Some states (like Virginia) had been taxing Virginians to pay off state debt.
Now they would pay more to pay off debts collected from other states.
Anger over bank
Jefferson believed in "strict constructionist" interpretation of the Constitution (bank not in Constitution)
Anger of Whiskey Tax
Farmers in West used whiskey as currency
Easiest way to transport grain to Eastern markets was to convert it into whiskey.
Spanish had closed the Mississippi River
Whiskey Rebellion 1794
Farmers terrorized tax collectors, stopped court proceedings (like Shays's Rebellion)
Proved democracy in hands of ordinary citizens was dangerous
Washington sent 15,000 troops to successfully crush rebellion.
Showed federal government stronger than Confederate Congress.
But harsh treatment of U.S. citizens worried people.
French Revolution officially began July 14, 1789 (Storming of the Bastille)
Became radical by 1793
King Louis XVI guillotined.
Sparked war with European monarchs (Prussia, Austria, Russia, Great Britain)
Prussia, Austria and Russia subdued by Napoleon leaving only Great Britain.
George Washington had declared American neutrality
Said U.S. not strong enough to get involved with foreign wars.
But, U.S. had made an agreement with France in return for aid in American Revolution
but felt culturally and economically closer to Great Britain.
Federalists supported Britain
Democratic-Republicans supported France
MOVING THE CAPITAL
Jefferson agreed that southerners would accept Hamilton's plan in exchange for national capital to the South
South objected to a capital in New York
South objected to a capital in Pennsylvania because of gradual emancipation.
New capital would be placed at the Potomac River between Maryland and Virginia
Named after George Washington ("Washington," District of Columbia)
The capital would temporarily move from NY to Philadelphia in Pennsylvania.
Capital was designed by Pierre-Charles L'Enfant in 1791
Designed so troops could be stationed around the city in case of an attack.
New political parties
Supporters of Jefferson gathered as the Jeffersonian-Republicans or Democratic-Republicans (Republicans)
Supporters of Hamilton became Federalist Party
Expanding the public sphere
Revolution and political discussions deepened democratization
Because of debates, more people began gathering and discussing politics
Democratic-Republican Societies formed from 1793-94
Said political liberty not just voting but involvement in public affairs.
Increasing number of newspapers.
Women began to take part in the political discussions and read newspapers
Called for better education for women.
Mary Wollstonecraft (wrote "Vindication of the Rights of Women")
Judith Sargent Murray (wrote "On the Equality of the Sexes," 1790)
Said women are as intellectually capable as men and should have economic independence.