During the war for independence, the states and the Confederation government were late with their debt repayments.
Hamilton wanted the debts to be repaid.
He explained that a robust economy depended on its integrity and reliability.
Hamilton argued that selling bonds to pay interest on war debts would give investors a stake in the success of the new government.
He claimed that Strengthening the New Nation would be a "national blessing," that it would provide a "mechanism for national unity," and that it would promote long- term prosperity.
Many people, then and since, did not understand the complexity of Hamilton's proposals.
James Madison broke with Hamilton over the federal government assuming the states' debts.
The northern states owed more than the southern states.
Most of the war debts were paid off by four states.
The other states weren't as conscientious.
Congress debated Hamilton's debt- assumption plan after Madison's fierce opposition.
The "assumption" plan was voted down by the House of Representatives.
Hamilton didn't give up.
He asked Jefferson, the new secretary of state, to help break the stalemate after failing to get members of Congress to switch their votes.
Jefferson invited Hamilton and Madison to dinner in New York City in June 1790.
They reached a famous compromise by the end of the night.
They agreed that the national capital should move from New York City to Phil adelphia for the next ten years and then build a new city in a federal district sandwiched between the slave states of Maryland.
In exchange for Madison finding the two votes needed to pass the debt- assumption plan, Hamilton agreed to find the votes in Congress to approve the move.
The compromise of 1790 went according to plan.
The federal government moved to Philadelphia in the late 1790s.
The nation's capital was moved again, this time to the new city of Washington in the federal District of Columbia.
The debt- funding scheme was a success.
The bonds issued by the federal government in 1790 were quickly snatched up by investors and used to pay off war debts.
New loans from European governments were obtained by Hamilton.
The nation had a better credit rating than all of Europe.
Hamilton set in motion the greatest economic success story in world history by making the new nation solvent.
The opposition to Hamilton's debt- financing scheme grew out of his own opposition.
The young Treasury Secretary viewed himself as Washington's prime minister.
Hamilton wanted to develop an economy centered on finance and manufacturing.
After securing congressional approval of his debt- funding scheme, he called for a national bank modeled after the Bank of England.
Hamilton believed that a safe place for the federal government's cash would be provided by a bank like that.
Hamilton explained that banks were essential.
They would increase the nation's money supply by issuing currency in amounts greater than their actual "reserve" in their vaults.
Madison and Jefferson argued that the government couldn't start a national bank since the Constitution didn't say anything about it.
Hamilton's proposed bank would not help most Americans according to Jefferson.
Over time, a small inner circle of self- serving financiers and investors would exercise corrupt control over Congress.
Hamilton had the better of the argument.
In favor of the national bank were representatives from the northern states who voted 33-1.
The growing political division between the North and South wasrated by the large vote.
President Washington sought the advice of his cabinet before he signed the bill creating the bank.
The debate was the first of its kind.
The con frontation between Jefferson and Hamilton was caused by the language used.
Jefferson was viewed by the Treasury secretary as a man of "profound ambition & violent passions" who was guided by an "unsound & dangerous" agrarian economic philosophy.
Jefferson hated the "monarchist" Hamilton more than he hated commerce, speculators, factories, banks, and bankers.
Jefferson pointed to the Tenth Amendment of the Constitution to stop the national bank.
Hamilton told the president that the power to charter corporations was an "implied" power of the government.
The authority to incorporate banks was not mentioned in any of the states' constitutions.
Washington was persuaded by Hamilton to sign the bank.
The president opened up a boundless field of power, which in the future would lead to a further broadening of the president's implied powers, with the approval of the Supreme Court.
Hamilton's vision was not complete.
The last of his recommendations to Congress, the "Report on Manufactures," was the final piece of his design for a modern capitalist economy.
Hamilton believed that industrialization would bring diver sification to an American economy dominated by agriculture and dangerously dependent on imported British goods, improve productivity through greater use of machinery, provide work for those not ordinarily employed outside the home, such as women and children, and encourage immigration of skilled industrial workers
An illustration of the changing nature of labor.
He claimed that government support would allow new industries to compete on equal terms with European enterprises.
Major transportation improvements, including the development of roads, canals, and harbors, were requested by Hamilton.
Some of Hamilton's pro- industry ideas were enacted because of strong opposition from Jefferson, Madison, and other southerners.
The arguments for manufacturing and fed eral y funded transportation projects were provided by Hamilton's proposals.
The lead ership of Hamilton was monumental.
As the Treasury department began to pay off the Revolutionary War debts, foreign capitalists and banks invested heavily in the American economy, and European nations as well as China began to trade with the United States.
The number of new businesses soared as the New Nation was strengthened.
According to a Bostonian, the nation had never had a brighter sunshine.
In the agricultural South and along the western frontier, Hamilton upset many people by advocating the values of a bustling capitalist system and the big cities and industries that went with it.
Jefferson and Madison formed a party hostile to Hamilton in order to make him the next president.
The political competition between Jefferson and Hamilton was pathological.
Jefferson preferred to follow the example of France rather than follow Hamilton's vision of a developing American economy and society.
The two men had differing views on how the Constitution should be interpreted.
Jefferson was called an "intriguing incendiary" by Hamilton.
He accused Jefferson of being a romantic who didn't see that manufacturing, industry, and banking would drive the economic future.
Washington's cabinet was fractured by Jefferson's opposition to Hamilton's politics.
They had become enemies with the leaders of the first political parties.
The planter elite in South Carolina were powerful in the New York and New England areas.
They feared the excesses of democracy, distrusted the common people, and wanted a strong central government led by the wisest leaders who would be committed to eco nomic growth, social stability, and national defense.
The Democratic Republicans, led by Thomas Jefferson and James Madison, were most concerned about threats to individual freedoms and states' rights posed by a strong national government.
They believed in the people.
In the south, the Democrats were strongest in Virginia, North Carolina, and Georgia.
Democrats promoted an agricultural economy.
The two American political par ties were influenced by unexpected events in Europe.
In July 1789, violence erupted in France when the working poor were enraged over soaring prices for bread, and in part inspired by the American Revolution.
Republican clubs hosted rallies on behalf of the French Revolution in support of local Republican candidates.
George Washington was the only man who rose above party differences during the nation's fragile infancy.
He was unanimously reelected to a second term, but quickly found himself in the middle of the French Revolution.
Prussia and Austria invaded France to stop the revolutionary movement from infecting their societies.
The French revolutionaries were inspired by the invaders to spread their ideal of democracy.
On February 1, 1793, the French revolutionary government declared war on Great Britain, Spain, and the Netherlands, and the conflict would last two decades.
The worst phase of the Revolution was called the Reign of Terror.
Thousands of "counterrevolutionary" political prisoners and Catholic priests were executed by Jacobins.
The streets were ruled by barbarism.
Secretary of State Thomas Jefferson was a big fan of French culture.
Alexander Hamilton and John Adams sided with Great Britain and its allies in the French Revolution.
The ability of the United States to remain neutral in world affairs was tested during the European war.
Both France and Britain wanted to stop the other from trading with the United States, even if it meant attacking U.S. merchant ships.
President Washington faced a ward decision as he began his second term.
Americans did not want to be part of the war.
Almost 90 percent of U.S. imports came from Britain.
Hamilton and Jefferson agreed that entering the conflict would be foolish.
Hamilton wanted to abandon the military alliance with the French because it had been made with a monarchy that no longer existed.
Jefferson wanted to use the alliance with France as a bargaining point.
Washington took a middle course.
The ugly feud between Jefferson and Hamilton was brought to a boil by the neutrality of his cabinet.
Jefferson wrote an angry letter to James Madison, urging him to cut Hamilton to pieces in the newspapers.
President Washington accepted Thomas Jefferson's argument that the United States should officially recognize the French revolutionary government and welcome its ambassador to the United States at the same time he issued the neutrality proclamation.
In April 1793, Citizen Genet arrived at Charleston, South Carolina, to a hero's welcome.
He violated U.S. neutrality by recruiting four American privateers to capture English and Spanish merchant vessels.
After five weeks in South Carolina, Genet traveled to the American capital, Philadelphia, where his efforts to draw America into the war on France's side embarrassed his friends in the Republican party.
Washington demanded that the French government replace Genet.
U.S. support for the Revolution was quickly cooled by the excesses of the radicals in France.
The same thing happened to President Washington.
He didn't like Jefferson and Madison for organizing Republican clubs.
Washington never spoke to Jefferson again after accepting his resignation.
Tensions between the United States and Great Britain were threatening to reignite.
The western and southern boundaries of the United States were left in dispute by the Treaty of Paris.
Strengthening the New Nation carried French goods or was sailing for a French port.
By early 1794, several hundred American ships had been seized, and their crews were given the terrible choice of joining the British navy or being imprisoned.
British troops in the Ohio Valley gave weapons to Indians who attacked American settlers.
President Washington sent Chief Justice John Jay to London to resolve the major issues between the two nations.
Britain demanded that America not sell products to France for the construction of warships.
Britain gained trading advantages.
The British refused to stop intercepting American merchant ships.
Jay conceded that the British didn't need to compensate the slaves who escaped to safety during the Revolutionary War.
The British made three important promises in return for Jay's help: They would evacuate their forts in northwest America by 1796, reimbursing Americans for the seizure of ships and cargo in 1793-1794, and grant U.S. merchants the right to trade again with them.
The treaty made the division between the two parties worse.
The most serious crisis of Washington's presidency was created by the uproar.
Some called for his removal from office.
The proposed agreement was the only way to avoid a war with Britain that the United States was bound to lose, according to the president.
Jay's Treaty barely won a majority in the Senate with Washington's support.
Washington had ridden out "the Storm," but he could never forget the "pernicious" people who were against him.
He wanted to return to Virginia.
Washington gave the young nation the gift of peace.
The treaty was pushed through Congress by the leader.
There were new conflicts in the Ohio Valley between American settlers and Native Americans.
The Northwest Indian War began after the British transferred the Ohio Country to the United States and his troops marched north from Cincinnati.
The British had no right to give away the ancestral lands of the Native Americans.
The Western Confederacy was formed to resist American settlement as pioneers moved into the Northwest Territory.
The Western Confederacy of some 2,000 warriors, supported by the British and Canadian militiamen, engaged General Wayne's troops and Indian allies in the Battle of Fallen Timbers in August of 1794.
The Americans built forts in northern Ohio and Indiana after defeating the Indians.
The United States bought most of the territory that would form the state of Ohio and the cities of Detroit and Chicago after the Indians agreed to the Treaty of Greenville.
The boundaries of Indian and American territories were established by the treaty.
Cash- poor farmers throughout the western frontier were incensed by Hamilton's 1791 tax on "distilled spirits".
The region's most valuable product was liquor made from grain or fruit.
Many turned to violence when efforts to repeal the tax failed.
Federal tax collectors and marshals were attacked by angry groups of farmers, militiamen, and laborers.
In the summer of 1794, the discontent exploded into rebellion in western Pennsylvania, home to a fourth of the nation's whiskey.
George Washington responded quickly to the first great domestic challenge to the federal government.
President Washington ordered the whiskey rebels to leave by September 1 or he would send in the militia.
Thousands of militiamen from several states began marching to western Pennsylvania after the rebels failed to respond.
Washington rode on horseback to greet the soldiers.
It was the last time a sitting president would lead troops in the field.
Two dozen were charged with high treason and sentenced to death, but were pardoned by Washington.
The show of force made the reb els and their sympathizers change their tactics.
The Whiskey Rebellion in Pennsylvania was quelled by George Washington's troops.
The Spanish began negotiations over control of the Mississippi River and the disputed northern boundary of their Florida colony at the end of the Revolutionary War, while events were unfolding in Pennsylvania.
In 1795, Thomas Pinckney persuaded the Spanish to accept a southern American boundary at the 31st parallel in west Florida, along the northern coast of the Gulf of Mexico.
The Spanish agreed to allow Americans to ship goods down the Mississippi River to New Orleans.
The Treaty of San Lorenzo, also known as the Pinckney's Treaty, was quickly approved by the Senate.
The treaties were signed by John Jay and Thomas Pinckney.
The federal government's acquisition of land from the British, the Spanish, and the Native Americans caused a raging debate in Congress over what to do with it.
The government should charge high prices for western lands to keep the East from losing both political influence and a labor force important to the growth of manufactures.
James Madison and Thomas Jefferson were willing to go along with these policies for the sake of reducing the national debt, but Jefferson preferred that the land be sold to farmers.
The Federalists won for the time being.
The Land Act of 1796 doubled the price of federal land to $2 per acre.
Half the townships would be sold for a minimum price of $1,280, a price 888-270-6611 888-270-6611 888-270-6611 888-270-6611 888-270-6611 888-270-6611 888-270-6611 888-270-6611 888-270-6611 888-270-6611 888-270-6611 888-270-6611 888-270-6611 888-270-6611 888-270-6611 888-270-6611 888-270-6611 888-270-6611 888-270-6611 888-270-6611 888-270-6611 888-270-6611 888-270-6611 888-270-6611 888-270-6611 888-270-6611 888-270-6611 888-270-6611 888-270-6611 888-270-6611 888-270-6611 888-270-6611 888-270-6611 888-270-6611 888-270-6611 888-270-6611 888-270-6611 888-270-6611 888-270-6611 888-270-6611 888-270-6611 888-270-6611 Federal land offices sold less than 50,000 acres by 1800.
The Land Act of 1800 reduced the minimum parcel to 320 acres and spread payments over four years.
One could buy a farm with a down payment of $160.
The house of David Twining, a Pennsylvania farmer, can be seen in the painting.
The territory known as Kentucky, or Kaintuck, from the Cherokee KEN-TA- KE (Great Meadow), was the result of thousands of settlers following the lure of western lands.
In the late 18th century, the Indian- held lands in Kentucky were a farmer's dream and a hunter's paradise.
By the age of twelve, he was a dead eye marksman and an accomplished woodsman, and he was born on a small farm in central Pennsylvania.
He set out in 1769 to find a trail into Kentucky after hearing reports about the lands over the Appalachian Mountains.
The Warriors' Path was a narrow foot trail that buffalo, deer, and Native Americans had used over the centuries.
In 1773, a group of white settlers entered Kentucky.
More than 300,000 settlers would use the Wilderness Road over the next twenty five years after the Warriors' Path was widened.
The settlement of Boonesborough was built at a point where a branch of the Wilderness Road intersects with the Kentucky River.
Kentucky was integrated into the state of Virginia in 1780.
He admitted that many heroic actions and chivalrous adventures are related to him.
Scots-Irish migrants from Virginia, North Carolina, and Pennsyl vania poured into Kentucky during the last quarter of the 18th century.
The painting is by George.
After clearing the land for planting, they would build a lean- to for temporary shelter.
The trees that could not be felled with an ax were cut around the trunk and left to die.
A farmer had to clear trees and plant a field filled with stumps.
Corn was the preferred crop for the pioneers because it kept well and had many uses.
Milk, butter, and cheese were supplied by cows.
President Washington decided in 1796 that he should not serve more than two terms in office.
He wanted to retire to Mount Vernon because of the criticism.
He would leave behind a record of achievement that included the organization of a new national government, a prosperous economy, the recovery of territory from Britain and Spain, and the admission of three new states: Vermont, Kentucky and Tennessee.
He alone would grant his slaves their freedom after he died.
On September 17, 1796, Washington delivered a farewell address in which he criticized the rise of partisanship and the emergence of political parties.
He felt that they endanger the republic because they pursued narrow interests rather than the good of the nation.
His warning was a fundamental principle in U.S. foreign policy until the early twentieth century.
The United States had its first election for president with Washington out of the race.
The estate was enlarged to over 8,000 acres and divided into five farms.
The Republicans chose Thomas Jefferson.
A young New York attorney and senator who was distrusted by many and disliked by most also ran as a Republican.
The campaign was not nice.
Taxes, excessive spending, and abuses of power were some of the things the Federalists were attacked for.
The Jeffer son was not decisive enough to be president, according to the Federalists.
Adams won the elec tion with 71 electoral votes, but Jefferson, who received 68 electoral votes, became vice president.
The houses of Congress were won by the Federalists.
John Adams was a political leader, but he was a better political theorist than he was.
Adams was always an honest man, but sometimes a wise one, according to Benjamin Franklin.
Adams had authored the Massachusetts state constitution.
He was George Washington's vice president and served as an exceptional diplomat in France, Hol land, and Great Britain during the Revolution.
He kept his head when other people were talking about him, probably at the cost of his reelection.
The "Quasi War" with France was the result of the angry French reaction to the Treaty between the United States and Great Britain.