After establishing the nation’s credit, in January 179
Treasury Secretary Alexander Hamilton proposed a Bank of the United States
which could issue bank notes (paper money) to private citizens.
He admired the Bank of England, and his plan called for private stockholders
who appointed most of the directors so that they would
not inflate the economy with too much paper money.
The government would own one-fourth of the stock
and would appoint five of the 25 directors.
The Senate approved the bank bill on January 21,
and a week later Hamilton submitted his “Report on the Mint.”
On January 23 the General Assembly of Maryland ceded to the
United States Congress ten square miles on the banks of the Potomac River
for the new seat of the United States Government.
On January 24 Washington sent this message to the Congress
on the new seat of the Government:
In execution of the powers with which Congress
were pleased to invest me by their Act entitled
“An Act for establishing the temporary and permanent seat
of the Government of the United States”
and on mature consideration of the advantages
and disadvantages of the several positions,
within the limits prescribed by the said Act, I have,
by Proclamation, bearing date this day, a copy of which
is herewith transmitted, directed Commissioners,
appointed in pursuance of the Act, to survey
and limit a part of the territory of ten miles square,
on both sides the river Potomac,
so as to comprehend George Town in Maryland,
and to extend to the Eastern branch.
I have not by this first Act given to the said territory
the whole extent of which it is susceptible
in the direction of the River;
because I thought it important that Congress
should have an opportunity of considering whether
by an amendatory law, they would authorize the location
of the residue at the lower end of the present,
so as to comprehend the Eastern branch itself, and some
of the Country on its lower side in the State of Maryland,
and the town of Alexandria in Virginia.
If, however, they are of opinion that the federal territory
should be bounded by the water edge of the Eastern branch,
the location of the residue will be
to be made at the upper end of what is now directed.
I have thought best to await a survey of the territory
before it is decided on what particular spot
on the North Eastern side of the River
the public buildings shall be erected.1
On February 8 the House of Representatives passed the bank bill 39-20.
James Madison questioned Hamilton’s bank bill and was supported
by Secretary of State Thomas Jefferson and Attorney General Edmund Randolph.
On February 16 Washington sent some papers to Hamilton with this letter:
“An Act to incorporate the Subscribers to the Bank
of the United States” is now before me for consideration.
The Constitutionality of it is objected to.
It therefore becomes more particularly my duty
to examine the ground on which the objection is built.
As a mean of investigation I have called upon
the Attorney General of the United States,
in whose line it seemed more particularly to be,
for his official examination and opinion.
His report is, that the Constitution does not warrant the Act.
I then applied to the Secretary of State
for his sentiments on this subject.
These coincide with the Attorney General’s;
and the reasons for their opinions
having been submitted in writing, I now require,
in like manner, yours, on the validity and propriety
of the above recited Act: and that you may know the points
on which the Secretary of State and the Attorney General
dispute the constitutionality of the Act;
and that I may be fully possessed of the Arguments
for and against the measure,
before I express any opinion of my own,
I give you an opportunity of examining and answering
the objections contained in the enclosed papers.
I require the return of them,
when your own sentiments are handed to me
(which I wish may be as soon as is convenient;)
and further, that no copies of them be taken, as it is
for my own satisfaction they have been called for.2
While waiting for Hamilton’s response, Washington asked James Madison
to summarize the objections to the bill so that he could prepare his veto message.
Hamilton in his “Final Version of an Opinion on the
Constitutionality of an Act to Establish a Bank” wrote,
“It is not denied that there are implied as well as express powers
and that the former are as effectually delegated as the latter.”3
The vote had shown how divided the nation was regionally as 34 out of 35
northern Congressmen voted in favor while 20 out of 25 southerners were opposed.
President George Washington was persuaded by Hamilton, and on February 25
he signed the bill that established the Bank of the United States.
The Republican Majority Leader in the House of Representatives James Madison,
Secretary of State Thomas Jefferson, and United States Attorney General Edmund Randolph
objected that the Constitution did not authorize the government to create a bank.
Treasury Secretary Hamilton argued that this and other powers were implied as
“necessary and proper” for fulfilling its designated powers such as collecting taxes,
borrowing money, regulating interstate trade, and supporting military forces.
Jefferson suggested the useful idea of using the decimal system for the United States currency.
On February 28 Jefferson and Madison asked Philip Freneau to
come to Philadelphia to help them establish a “vehicle of intelligence,”
and Jefferson offered him a translating position in the State Department.
In 1781 Freneau had written the poem “The British Prison-Ship” describing the brutal conditions he suffered as a prisoner during the Revolutionary War. In On False Systems of Government he wrote,
How can we call those systems just
Which bid the few, the proud, the first,
Possess all earthly good;
While millions robbed of all that’s dear
In silence shed the ceaseless tear,
And leaches suck their blood.4
The annual debt service was $826,625, and current revenues were insufficient.
The United States Bank was authorized to issue
notes up to $10 million beyond its deposits.
To help pay off the debt Congress imposed an excise tax on the production of liquor
and other luxuries such as snuff and sugar loaf, and the law passed on 3 March 1791.
On March 4 Vermont was admitted into the Union as the 14th state.
On March 15 Jefferson submitted his report on
America’s international commerce to the Congress.
He advised duties on any nation that taxed or prohibited American goods to warn them.
If they continued, he recommended prohibiting their goods.
Jefferson persuaded a Senate committee to let the President
have the discretion of deciding on salaries of diplomats to other countries.
He agreed with Benjamin Franklin that whatever people made
beyond a “modest competence” and enough money to provide
for their families and educate the children was a surplus made
possible by the society which thus had a right to ask for it back
through progressive taxes on excess income and inheritance.
Jefferson noted that history shows reform movements begin with high ideals
but tend to deteriorate into exploitation and rigidity
“with the governments preying on the people and the rich on the poor.”
He was glad that wheat had replaced tobacco as a major crop in Virginia
because it symbolized independence and self-reliance as well as being food.
Many leaders of different persuasions such as Washington, Jefferson, John Adams
Tom Paine, and Patrick Henry were opposed to the factionalism of parties
while the controversial debates moved inexorably in that direction.
Gradually the Anti-Federalists came to be called “Republicans,”
and they were disparagingly referred to by Federalists as “Democrats.”
Secretary of State Jefferson regularly opposed the views of the conservative
Federalist Hamilton and became the leader of the Republican Party
and was supported by James Madison and James Monroe.
New York elected Aaron Burr to the Senate,
and he became the Republicans’ political leader in that body.
The new government was fortunate that the depression had ended.
When George Hammond became the first British minister to the United States,
Jefferson met him with coldness.
Hammond then turned to consulting with Treasury Secretary Hamilton.
While the Congress was in recess, on April 7 Washington began his tour
of the South going to North Carolina, South Carolina, and Georgia,
and he returned to Philadelphia on July 6.
Washington met with a Jewish congregation in Newport, Rhode Island,
and then he toured the Carolinas and Georgia.
He was widely admired as the hero of the Revolution.
Yet the fear of monarchy prevented people from
giving him titles or opposed his image on coins.
In France on July 1 Tom Paine published his Republican Manifesto.
On the 15th in Paris the French Guard fired on 50,000 protestors.
The next day the Marquis de Lafayette was one of the leaders
who began the Feuillants, urging the right to revise the constitution.
That month Paine and Condorcet began editing Le Républican.
In a letter to Lafayette on July 28 Washington wrote:
I have, my dear Sir, to acknowledge the receipt
of your favors of the 7 of March and 3 of May,
and to thank you for the communications
which they contain relative to your public affairs.
I assure you I have often contemplated, with great anxiety,
the danger to which you are personally exposed by your
peculiar and delicate situation in the tumult of the times,
and your letters are far from quieting that friendly concern.
But to one, who engages in hazardous enterprises
for the good of his country, and who is guided
by pure and upright views,
(as I am sure is the case with you)
life is but a secondary consideration.
To a philanthropic mind the happiness of 24 millions
of people cannot be indifferent—and by an American,
whose country in the hour of distress
received such liberal aid from the French,
the disorders and incertitude of that Nation
are to be peculiarly lamented.
We must, however, place a confidence in that Providence
who rules great events, trusting that out of confusion
he will produce order, and notwithstanding
the dark clouds which may threaten at present,
that right will ultimately be established.
The tumultuous populace of large cities
are ever to be dreaded.
Their indiscriminate violence prostrates for the time
all public authority, and its consequences
are sometimes extensive and terrible.
In Paris we may suppose these tumults
are peculiarly disastrous at this time,
when the public mind is in a ferment, and when
(as is always the case on such occasions)
there are not wanting wicked and designing men,
whose element is confusion, and who will not hesitate
in destroying the public tranquility to gain a favorite point.
But until your Constitution is fixed,
your government organized,
and your representative Body renovated,
much tranquility cannot be expected;
for, until these things are done,
those who are unfriendly to the revolution,
will not quit the hope of bringing matters
back to their former state.
The decrees of the National Assembly respecting
our tobacco and oil do not appear to be
very pleasing to the people of this country;
but I do not presume that any hasty measures
will be adopted in consequence thereof;
for we have never entertained a doubt
of the friendly disposition of the French Nation towards us,
and are therefore persuaded that if they have done
anything which seems to bear hard upon us,
at a time when the Assembly must have been occupied
in very important matters, and which perhaps could not
allow time for a due consideration of the subject,
they will, in the moment of calm deliberation,
alter it, and do what is right.
I readily perceive, my dear Sir,
the critical situation in which you stand,
and never can you have greater occasion
to shew your prudence, judgment, and magnanimity.
On the 6 of this month I returned from a tour
through the southern States,
which had employed me for more than three months.
In the course of this journey I have been highly gratified
in observing the flourishing state of the Country,
and the good dispositions of the people.
Industry and economy have become very fashionable
in those parts, which were formerly noted
for the opposite qualities, and the labors of man
are assisted by the blessings of Providence.
The attachment of all Classes of citizens
to the general Government seems to be a pleasing presage
of their future happiness and respectability.
The complete establishment of our public credit is
a strong mark of the confidence of the people in the virtue
of their Representatives, and the wisdom of their measures;
and, while in Europe, wars or commotions seem to agitate
almost every nation, peace and tranquility prevail among us,
except on some parts of our western frontiers where
the Indians have been troublesome, to reclaim or chastise
whom proper measures are now pursuing.
This contrast between the situation of the people
of the United States, and those of Europe is too striking
to be passed over even by the most superficial observer,
and may, I believe, be considered as one great cause
of leading the people here to reflect more attentively
on their own prosperous state, and to examine
more minutely, and consequently approve more fully
of the government under which they live,
than they otherwise would have done.
But we do not wish to be the only people who may taste
the sweets of an equal and good government;
we look with an anxious eye for the time
when happiness and tranquility shall prevail
in your country—and when all Europe shall be freed
from commotions, tumults, and alarms.
Your friends in this country often express their great
attachment to you by their anxiety for your safety.
Knox, Jay, Hamilton, Jefferson remember you
with affection; but none with more sincerity
and true attachment than, etc.5
Washington had sent Gouverneur Morris to England in March 1790,
and on 28 July 1791 he wrote to him:
The communications in your several letters, relative to
the state of Affairs in Europe, are very gratefully received;
and I should be glad if it was in my power to reply to them
more in the detail than I am able to do.
But my public duties, which are at all times
sufficiently numerous, being now much accumulated
by an absence of more than three months
from the Seat of Government,
make the present a very busy moment for me.
The change of systems, which have so long prevailed
in Europe, will, undoubtedly, affect us in a degree
proportioned to our political or commercial connections
with the several nations of it.
But I trust we shall never so far lose sight
of our own Interest & happiness as to become,
unnecessarily, a party in their political disputes.
Our local situation enables us to maintain that state
with respect to them, which otherwise,
could not, perhaps, be preserved by human wisdom.
The present moment seems pregnant with great events;
but, as you observe, it is beyond the ken of mortal
foresight to determine what will be the result
of those changes which are either making,
or contemplated in the general system of Europe.
Although as fellow-men we sincerely lament
the disorders, oppressions & incertitude
which frequently attend national events;
and which our European brethren must feel;
yet we cannot but hope, that it will terminate
very much in favor of the Rights of Man.
And, that a change there,
will be favorable to this Country, I have no doubt.
For under the former system we were seen either
in the distresses of War, or viewed after the peace
in a most unfavorable light
through the medium of our distracted State.
In neither point could we appear
of much consequence among nations.
And should affairs continue in Europe in the same state
they were when these impressions respecting us
were received, it would not be an easy matter
to remove the prejudices imbibed against us.
A change of system will open a new view of things,
and we shall then burst upon them
as it were with redoubled advantages.
Should we, under the present state of Affairs,
form connections, other than we now have,
with any European Powers,
much must be considered in effecting them,
on the score of our increasing importance as a Nation;
and at the same time, should a treaty
be formed with a nation whose circumstances
may not at that moment be very bright,
much delicacy would be necessary in order to shew
that no undue advantages were taken on that account.
For unless treaties are mutually beneficial to the parties,
it is vain to hope for a continuance of them
beyond the moment when the one which conceives itself
over reached is in a situation to break off the connection.
And I believe it is among nations as with individuals,
the party taking advantage of the distresses of another
will lose infinitely more in the opinion of mankind
and in subsequent events,
than he will gain by the stroke of the moment.
In my late tour through the Southern States,
I experienced great satisfaction in seeing the good effects
of the general Government in that part of the Union.
The people at large have felt the security which it gives,
and the equal justice which it administers to them.
The Farmer, the Merchant, and the Mechanic have seen
their several Interests attended to, and from thence
they unite in placing a confidence in their representatives,
as well as in those in whose hands
the Execution of the Laws is placed.
Industry has there taken place of idleness,
and economy of dissipation.
Two or three years of good crops,
and a ready market for the produce of their lands
has put everyone in good humor;
and, in some instances they even impute to the Government
what is due only to the goodness of Providence.
The establishment of public credit,
is an immense point gained in our national concerns.
This, I believe, exceeds the expectation
of the most sanguine among us;
and a late instance, unparalleled in this Country,
has been given of the confidence reposed in our measures,
by the rapidity with which the subscriptions
to the Bank of the United States were filled.
In two hours after the Books were opened
by the Commissioners the whole number of shares
were taken up, and four thousand more applied for
than were allowed by the Institution.
This circumstance was not only pleasing
as it related to the confidence in Government;
but as it exhibited an unexpected proof
of the resources of our Citizens.
In one of my letters to you the account of the number
of inhabitants which would probably be found
in the United States on enumeration, was too large.
The estimate was then founded on the ideas held out
by the Gentlemen in Congress of the population
of the several States, each of whom (as was very natural)
looking through a magnifying glass
would speak of the greatest extent to which
there was any probability of their numbers reaching.
Returns of the Census have already been made
from several of the States, and a tolerably just estimate
has been formed now in others, by which it appears
that we shall hardly reach four millions;
but one thing is certain our real numbers will exceed,
greatly, the official returns of them;
because the religious scruples of some,
would not allow them to give in their lists;
the fears of others that it was intended as the foundation
of a tax induced them to conceal or diminished theirs;
and thro’ the indolence of the people, and the negligence
of many of the Officers numbers are omitted.
The authenticated number however is far greater,
I believe, than has ever been allowed in Europe,
and will have no small influence in enabling them to form
a more just opinion of our present growing importance
than has yet been entertained there.6
On July 4 the Treasury began selling shares in the Bank of the United States.
The par value of the stock was $400, but Hamilton allowed down payments
as low as $25 for “scrip” which enabled them to buy full shares later.
Most of this was sold in Philadelphia, Boston, and New York,
and this caused southerners to be afraid of northern control.
By August 11 the bank’s scrip price had increased to $300.
In Philadelphia, New York, Boston, Baltimore, and Charleston
offices on July 4 had begun accepting subscriptions for bank stock for $25.
The United States Bank’s capital was set at $10 million with $8 million
to be supplied by private investors, who were to put down one-quarter in specie.
Within an hour all the available scrip was subscribed,
and many investors doubled their money in a few days.
On August 11 scrip in New York reached a high of $280,
and in Philadelphia it went to $320.
Speculators believing it was over-valued began selling,
and the next day the bubble burst as the price fell to $150.
Hamilton allowed the government to pay for its stock in ten annual installments,
and private stock purchasers had to pay in 18 months.
The bank scrip moved from $110 up to $140 while speculative scrip
which had fallen to $67 rose to $145 in September.
In October the Bank of the United States chose its 25 directors
from various states and began doing business in Philadelphia.
On August 17 Hamilton had written a critical letter to William Duer
because he had heard that he made “fictitious purchases” to fool the public.
That summer the married Hamilton began a love affair with Mrs. Maria Reynolds,
and in December he began making blackmail payments to her husband James Reynolds.
On September 8 Jefferson and Madison met with the commissioners
that President Washington appointed to plan the new capital on the Potomac,
and they decided to name the federal district “Columbia”
and made the capital the “City of Washington.”
At this time the United States had nearly 100 newspapers, though only eight were dailies.
They printed foreign and national news and could fill them with political debates.
Benjamin Bache, the grandson of Benjamin Franklin, had started the General Advertiser
in October 1790 to oppose the Federalist administration, and it later became the Aurora.
Jefferson in July 1791 hired the poet Philip Freneau as a translator in the State Department
and with Madison supported his National Gazette which published its first issue
on October 31 accusing Hamilton of being the main person in the monarchist conspiracy
while he called Jefferson the “colossus of liberty.”
Hamilton had sponsored John Fenno’s Gazette of the United States in New York
since 1789 with printing jobs for the Treasury and the Senate,
and they published the “Discourses of Davila” by John Adams in 1790.
The Gazette had moved to Philadelphia with Congress in December.
Jefferson accused Fenno of favoring the
“doctrines of monarchy, aristocracy, and the exclusion of the influence of the people.”7
Thomas Paine was involved in the French Revolution,
and he wrote The Rights of Man which was published at London in March.
The French revolution became a controversial issue, and the conservative
Edmund Burke in England wrote his Reflections on the Revolution in France.
This made Thomas Paine so angry that in March he quickly published
in London The Rights of Man dedicated to Washington.
The Republicans adopted Paine’s work as their guide.
Articles were published with the name “Publicola” in defense of John Adams,
and eventually people learned that they were written by his son John Quincy Adams.
Thomas Jefferson helped get it published in Philadelphia in early May,
and a letter he wrote to the publisher was published as the preface without his permission.
Jefferson explained that in a long letter to Washington.
The United States Supreme Court had met twice briefly
in February and August 1790 even though they had no cases.
The court had two cases in 1791 and five each in 1792 and 1793.
In May 1791 a circuit court found invalid a Connecticut law that collected additional interest.
In 1792 a circuit court in Georgia considered a treaty superior to a previous state law
which had blocked recovery of the original debt.
In Hayburn’s Case on August 11 the US Supreme Court struck down an act of Congress
as unconstitutional because they did not believe the federal courts
should have jurisdiction in all pension suits against the government.
As a result of Hamilton’s persuasion in September King George III sent
George Hammond as Britain’s first minister to the United States, and he arrived in the fall.
On
October 10 Washington wrote to Attorney General Edmund Randolph,
It is my wish & desire that you would examine the Laws
of the General Government which have relation to
Indian Affairs, that is, for the purpose of securing their
lands to them; Restraining States—or Individuals from
purchasing their lands, and forbidding unauthorized
intercourse in their dealing with them.
And moreover, that you would suggest such auxiliary Laws
as will supply the defects of those which are in being,
thereby enabling the Executive to enforce obedience.
If Congress expect to live in Peace with the
Neighboring Indians and to avoid the
Expenses and horrors of continual hostilities,
such a measure will be found indispensably necessary;
for unless adequate penalties are provided,
that will check the spirit of speculation in lands
and will enable the Executive to carry them into effect,
this Country will be constantly embroiled with,
and appear faithless in the eyes not only
of the Indians but of the neighboring powers also.
For notwithstanding the existing laws, solemn Treaties,
and Proclamations which have been issued to enforce
a compliance with both, and some attempts
of the Government south west of the Ohio
to restrain their proceedings.
The agents for the Tennessee Company are at this moment
by public advertisements under the signature of
a Zachariah Cox encouraging by offers of land,
and other inducements, a settlement at the Mussle-Shoals,
and is likely to obtain Emigrants for that purpose
although there is good evidence, that the measure
is disapproved by the Creeks and Cherokees;
and it is presumed is so likewise by the Chickasaws
and Choctaws, unless they have been imposed upon
by assurances that trade is the only object
they have in view by the Establishment.8
The second Congress began on 24 October 1791, and the next day
Washington gave his Third Annual Message to Congress on the State of the Union.
I meet you upon the present occasion with the feelings
which are naturally inspired by a strong impression
of the prosperous situations of our common country,
and by a persuasion equally strong that the labors
of the session which has just commenced will,
under the guidance of a spirit no less prudent than patriotic,
issue in measures conducive to the stability
and increase of national prosperity.
Numerous as are the providential blessings
which demand our grateful acknowledgments,
the abundance with which another year has again
rewarded the industry of the husbandman
is too important to escape recollection.
Your own observations in your respective situations
will have satisfied you of the progressive state
of agriculture, manufactures, commerce, and navigation.
In tracing their causes you will have remarked
with particular pleasure the happy effects
of that revival of confidence, public as well as private,
to which the Constitution and laws of the United States
have so eminently contributed; and you will have observed
with no less interest new and decisive proofs
of the increasing reputation and credit of the nation.
But you nevertheless can not fail to derive satisfaction
from the confirmation of these circumstances
which will be disclosed in the several official communications
that will be made to you in the course of your deliberations.
The rapid subscriptions to the Bank of the United States,
which completed the sum allowed to be subscribed
in a single day, is among the striking and pleasing evidences
which present themselves, not only of confidence
in the Government, but of resource in the community.
In the interval of your recess due attention has been paid
to the execution of the different objects which were specially
provided for by the laws and resolutions of the last session.
Among the most important of these is
the defense and security of the western frontiers.
To accomplish it on the most humane principles
was a primary wish.
Accordingly, at the same time the treaties have been
provisionally concluded and other proper means
used to attach the wavering and to confirm
in their friendship the well-disposed tribes of Indians;
effectual measures have been adopted to make those
of a hostile description sensible that a pacification
was desired upon terms of moderation and justice.
Those measures having proved unsuccessful,
it became necessary to convince the refractory of the power
of the United States to punish their depredations.
Offensive operations have therefore been directed,
to be conducted, however, as consistently
as possible with the dictates of humanity.
Some of these have been crowned with full success,
and others are yet depending.
The expeditions which have been completed were carried on
under the authority and at the expense of the United States
by the militia of Kentucky, whose enterprise, intrepidity,
and good conduct are entitled of peculiar commendation.
Overtures of peace are still continued
to the deluded tribes, and considerable numbers
of individuals belonging to them have lately renounced
all further opposition, removed from their former situations,
and placed themselves under
the immediate protection of the United States.
It is sincerely to be desired that all need of coercion
in future may cease and that an intimate intercourse
may succeed, calculated to advance the happiness of
the Indians and to attach them firmly to the United States.In order to do this it seems necessary:
That they should experience the benefits
of an impartial dispensation of justice.
That the mode of alienating their lands,
the main source of discontent and war,
should be so defined and regulated as to obviate imposition
and as far as may be practicable controversy concerning
the reality and extent of the alienations which are made.
That commerce with them should be promoted
under regulations tending to secure an equitable deportment
toward them, and that such rational experiments
should be made for imparting to them the blessings
of civilization as may from time to time suit their condition.
That the Executive of the United States should be enabled
to employ the means to which
the Indians have been long accustomed for uniting
their immediate interests with the preservation of peace.
And that efficacious provision should be made
for inflicting adequate penalties upon all those who,
by violating their rights, shall infringe the treaties
and endanger the peace of the Union.
A system corresponding with the mild principles of religion
and philanthropy toward an unenlightened race of men,
whose happiness materially depends
on the conduct of the United States,
would be as honorable to the national character
as conformable to the dictates of sound policy.
The powers specially vested in me by the act
laying certain duties on distilled spirits,
which respect the subdivisions of the districts into surveys,
the appointment of officers, and the assignment
of compensations, have likewise carried into effect.
In a manner in which both materials and experience
were wanting to guide the calculation
it will be readily conceived that there must have been
difficulty in such an adjustment of the rates of compensation
as would conciliate a reasonable competency
with a proper regard to the limits prescribed by the law.
It is hoped that the circumspection which has been used
will be found in the result to have secured
the last of the two objects; but it is probable that
with a view to the first in some instances
a revision of the provision will be found advisable.
The impressions with which this law has been received
by the community have been upon the whole
such as were to be expected
among enlightened and well-disposed citizens
from the propriety and necessity of the measure.
The novelty, however, of the tax in a considerable part
of the United States and a misconception of some
of its provisions have given occasion
in particular places to some degree of discontent;
but it is satisfactory to know that this disposition yields
to proper explanations and more just apprehensions
of the true nature of the law,
and I entertain a full confidence that it will in all give way
to motives which arise out of a just sense of duty
and a virtuous regard to the public welfare.
If there are any circumstances in the law
which consistently with its main design may be
so varied as to remove any well-intentioned objections
that may happen to exist, it will consist with
a wise moderation to make the proper variations.
It is desirable on all occasions to unite with a steady
and firm adherence to constitutional and necessary acts
of Government the fullest evidence of a disposition
as far as may be practicable to consult the wishes
of every part of the community and to lay the foundations
of the public administration in the affections of the people.
Pursuant to the authority contained in the several acts
on that subject, a district of 10 miles square
for the permanent seat of the Government
of the United States has been fixed
and announced by proclamation, which district will
comprehend lands on both sides of the river Potomac
and the towns of Alexandria and Georgetown.
A city has also been laid out agreeably to a plan which
will be placed before Congress, and as there is a prospect,
favored by the rate of sales which have already taken place,
of ample funds for carrying on the necessary public
buildings, there is every expectation of their due progress.
The completion of the census of the inhabitants, for which
provision was made by law, has been duly notified
(excepting one instance in which the return has been
informal, and another in which it has been omitted
or miscarried), and the returns of the officers who
were charged with this duty, which will be laid before you,
will give you the pleasing assurance that the present
population of the United States borders on 4,000,000 persons.
It is proper also to inform you that a further loan
of 2,500,000 florins has been completed in Holland,
the terms of which are similar to those
of the one last announced,
except as to a small reduction of charges.
Another, on like terms, for 6,000,000 florins,
had been set on foot under circumstances
that assured an immediate completion.Gentlemen of the Senate:
Two treaties which have been provisionally concluded
with the Cherokees and Six Nations of Indians
will be laid before you for your consideration and ratification.Gentlemen of the House of Representatives:
In entering upon the discharge of your legislative trust
you must anticipate with pleasure that
many of the difficulties necessarily incident
to the first arrangements of a new government
for an extensive country have been happily surmounted
by the zealous and judicious exertions of your predecessors
in cooperation with the other branch of the Legislature.
The important objects which remain to be accomplished will,
I am persuaded, be conducted upon principles
equally comprehensive and equally well calculated
of the advancement of the general weal.
The time limited for receiving subscriptions
to the loans proposed by the act making provision
for the debt of the United States having expired,
statements from the proper department will
as soon as possible apprise you of the exact result.
Enough, however, is known already to afford an assurance
that the views of that act have been substantially fulfilled.
The subscription in the domestic debt of the United States
has embraced by far the greatest proportion of that debt,
affording at the same time proof of the general satisfaction
of the public creditors with the system
which has been proposed to their acceptance
and of the spirit of accommodation to the convenience
of the Government with which they are actuated.
The subscriptions in the debts of the respective States
as far as the provisions of the law have permitted
may be said to be yet more general.
The part of the debt of the United States
which remains unsubscribed
will naturally engage your further deliberations.
It is particularly pleasing to me to be able to announce
to you that the revenues which have been established
promise to be adequate to their objects,
and may be permitted, if no unforeseen exigency occurs,
to supersede for the present the necessity
of any new burthens upon our constituents.
An object which will claim your early attention
is a provision for the current service of the ensuing year,
together with such ascertained demands upon the Treasury
as require to be immediately discharged,
and such casualties as may have arisen in the execution
of the public business, for which no specific appropriation
may have yet been made;
of all which a proper estimate will be laid before you.Gentlemen of the Senate
and of the House of Representatives:
I shall content myself with a general reference
to former communications for several objects
upon which the urgency of other affairs
has hitherto postponed any definitive resolution.
Their importance will recall them to your attention,
and I trust that the progress already made
in the most arduous arrangements of the Government
will afford you leisure to resume them to advantage.
These are, however, some of them
of which I can not forbear a more particular mention.
These are the militia, the post office and post roads,
the mint, weights and measures, a provision
for the sale of the vacant lands of the United States.
The first is certainly an object of primary importance
whether viewed in reference to the national security
to the satisfaction of the community
or to the preservation of order.
In connection with this the establishment of competent
magazines and arsenals and the fortification
of such places as are peculiarly important and vulnerable
naturally present themselves to consideration.
The safety of the United States under divine protection
ought to rest on the basis of systematic
and solid arrangements, exposed as little as possible
to the hazards of fortuitous circumstances.
The importance of the post office and post roads
on a plan sufficiently liberal and comprehensive,
as they respect the expedition, safety,
and facility of communication, is increased
by their instrumentality in diffusing a knowledge of the laws
and proceedings of the Government, which,
while it contributes to the security of the people,
serves also to guard them against the effects
of misrepresentation and misconception.
The establishment of additional cross posts,
especially to some of the important points
in the Western and Northern parts of the Union,
can not fail to be of material utility.
The disorders in the existing currency,
and especially the scarcity of small change,
a scarcity so peculiarly distressing to the poorer classes,
strongly recommend the carrying into immediate effect
the resolution already entered into
concerning the establishment of a mint.
Measures have been taken pursuant to that resolution
for procuring some of the most necessary artists,
together with the requisite apparatus.
An uniformity in the weights and measures of the country
is among the important objects submitted to you
by the Constitution, and if it can be derived
from a standard at once invariable and universal,
must be no less honorable to the public councils
than conducive to the public convenience.
A provision for the sale of the vacant lands
of the United States is particularly urged,
among other reasons, by the important considerations that
they are pledged as a fund for reimbursing the public debt;
that if timely and judiciously applied
they may save the necessity of burthening our citizens
with new taxes for the extinguishment of the principal;
and that being free to discharge the principal
but in a limited proportion,
no opportunity ought to be lost
for availing the public of its right.9
He reported happily that the new Bank of the United States
became fully subscribed on its first day.
He reviewed how depredations by Indians in the northwest
required offensive operations that were ongoing.
General Arthur St. Clair governed the Northwest Territory
and had assembled 2,387 regulars and militia by September.
The President described how a new act laying certain duties on distilled spirits
was being carried into effect to provide needed revenue.
The census had been completed and found that the population
of the United States was about four million people.
On October 26 Washington sent this message to the United States Senate:
I have directed the Secretary of War, to lay before you
for your consideration, all the papers relative to the
negotiations with the Cherokee Indians, and the treaty
concluded with that tribe, on the 2nd day of July last,
by the Superintendent of the Southern District;
and I request your advice whether to ratify the same.
I also lay before you the instructions to Colonel Pickering,
and his conference with the six Nations of Indians.
These conferences were for the purpose of conciliation,
and at a critical period to withdraw those Indians
to a greater distance from the theatre of war,
in order to prevent their being involved therein.
It might not have been necessary to have requested
your opinion on this business, had not the Commissioner,
with good intentions, but incautiously, made certain
ratifications of lands, unauthorized by his instructions,
and unsupported by the Constitution.
It therefore became necessary to disavow the transaction
explicitly, in a letter written by my orders to the Governor
of New York, on the 17th of August last.
The Speeches to the Cornplanter, and other Seneca
Chiefs, the instructions to Col. Procter and his report,
and other messages and directions are laid before you
for your information, and as evidences that all proper
lenient measures preceded the exercise of coercion.
The letters to the Chief of the Creeks, are also laid
before you, to evince that the requisite steps have
been taken, to produce a full compliance with
the treaty with that nation on the 7th of August 1790.10
The House of Representatives had asked Treasury Secretary Hamilton
for an economic plan to develop manufacturing, and after nearly two years
of research he submitted his Report on Manufactures on December 5
to the House of Representatives to promote making the United States
independent of foreign nations for military and essential supplies.
Here is the first part and some highlights:
The expediency of encouraging manufactures
in the United States, which was no long since
deemed very questionable, appears at this time
to be pretty generally admitted.
The embarrassments which have obstructed the progress
of our external trade, have led to serious reflections
on the necessity of enlarging the sphere
of our domestic commerce: the restrictive regulations,
which in foreign markets abridge the vent
of the increasing surplus of our agricultural produce,
serve to beget an earnest desire,
that a more extensive demand for that surplus
may be created at home:
And the complete success conspiring with the promising
symptoms which attend some less mature essays in others,
justify a hope, that the obstacles to the growth
of this species of industry are less formidable
than they were apprehended to be;
and that it is not difficult to find, in its further extension,
a full indemnification for any external disadvantages,
which are or may be experienced,
as well as an accession of resources,
favorable to national independence and safety….
It has been maintained that agriculture is,
not only, the most productive
but the only productive species of industry.
The reality of this suggestion, in either respect, has,
however, not been verified by any accurate detail
of facts and calculations; and the general arguments,
which are adduced to prove it,
are rather subtle and paradoxical, than solid or convincing….
It is not uncommon to meet with an opinion that
though the promoting of manufactures,
may be the interest of a part of the union,
it is contrary to that of another part.
The northern and southern regions are sometimes
represented as having adverse interests in this respect.
Those are called manufacturing, these agricultural states,
and a species of opposition is imagined to subsist
between the manufacturing and agricultural interests.
The idea of an opposition between those two interests
is the common error of the early periods of every country,
but experience gradually dissipates it.
Indeed they are perceived so often to succor
and to befriend each other,
that they come at length to be considered as one;
a supposition which has been frequently abused,
and is not universally true.
Particular encouragements of particular manufactures
may be of a nature to sacrifice the interests
of landholders to those of manufacturers;
but it is nevertheless a maxim well established
by experience, and generally acknowledged,
where there has been sufficient experience,
that the aggregate prosperity of manufactures,
and the aggregate prosperity of agriculture
are intimately connected.
In the course of discussion which has had place,
various weighty considerations have been adduced
operating in support of that maxim.
Perhaps the superior steadiness of the demand
of a domestic market for the surplus produce of the soil,
is alone a convincing argument of its truth.
In proportion as the mind is accustomed to trace
the intimate connection of interest,
which subsists between all the parts of a society,
united under the same government;
the infinite variety of channels which serve to circulate
the prosperity of each to and through the rest,
in that proportion will it be little apt
to be disturbed by solicitudes and apprehensions
which originate in local discriminations.
It is a truth as important, as it is agreeable,
and one to which it is not easy to imagine exceptions,
that everything tending to establish substantial
and permanent order, in the affairs of a country,
to increase the total mass of industry and opulence,
is ultimately beneficial to every part of it.
On the credit of this great truth, an acquiescence
may safely be accorded, from every quarter,
to all institutions, and arrangements,
which promise a confirmation of public order,
and an augmentation of national resource….
In countries where there is great private wealth
much may be effected
by the voluntary contributions of patriotic individuals;
but in a community situated like that of the United States,
the public purse must supply
the deficiency of private resource.
In what can it be so useful
as in prompting and improving the efforts of industry?11
Government would aid businesses with protective tariffs by exempting
essential raw materials from import duties, by giving subsidies and bounties
for inventions, and by modernizing transportation.
For Hamilton promoting the general welfare included
education, agriculture, manufacturing, and commerce.
The Tariff Act of 1792 would include many of his ideas except for the fisheries.
He and Coxe organized the Society for Establishing Useful Manufacturers (SEUM)
to engage in this with capitalization of $500,000,
and New Jersey’s Governor William Paterson granted a charter
founding the town of Paterson on 22 November 1791.
The Treasury Department let go of its control over the Bank of the United States, and
Thomas Willing, the former president of the Bank of North America, became its president.
Stockholders voted to start branches in Boston, New York, Charleston, and Baltimore
even before the main branch at Philadelphia opened on December 12.
James Madison began publishing a series of 18 essays in the National Gazette
criticizing the Washington administration starting in November.
On December 19 he wrote, “Public opinion sets bounds to every government
and is the real sovereign in every free one.”12
By 15 December 1791 the Bill of Rights had been ratified
by the Congress and the states, and they became
these first ten amendments to the United States Constitution:
Article I
Congress shall make no law respecting an establishment
of religion, or prohibiting the free exercise thereof;
or abridging the freedom of speech, or of the press:
or the right of the people peaceably to assemble, and
to petition the Government for a redress of grievances.Article II
A well regulated Militia, being necessary
to the security of a free State, the right of the people
to keep and bear Arms, shall not be infringed.Article III
No Soldier shall, in time of peace be quartered in any house,
without the consent of the Owner, nor in time of war,
but in a manner to be prescribed by law.Article IV
The right of the people to be secure in their persons,
houses, papers, and effects, against unreasonable searches
and seizures, shall not be violated,
and no Warrants shall issue, but upon probable cause,
supported by Oath or affirmation,
and particularly describing the place to be searched,
and the persons or things to be seized.Article V
No person shall be held to answer for a capital,
or otherwise infamous crime,
unless on a presentment or indictment of a Grand Jury,
except in cases arising in the land or naval forces,
or in the Militia, when in actual service
in time of War or public danger;
nor shall any person be subject for the same offence
to be twice put in jeopardy of life or limb;
nor shall be compelled in any Criminal Case
to be a witness against himself,
nor be deprived of life, liberty, or property,
without due process of law;
nor shall private property be taken for public use,
without just compensation.Article VI
In all criminal prosecutions, the accused shall enjoy the right
to a speedy and public trial, by an impartial jury of the State
and district wherein the crime shall have been committed,
which district shall have been previously ascertained by law,
and to be informed of the nature
and cause of the accusation;
to be confronted with the witnesses against him;
to have compulsory process
for obtaining Witnesses in his favor,
and to have the Assistance of Counsel for his defence.Article VII
In Suits at common law, where the value in controversy
shall exceed twenty dollars,
the right of trial by jury shall be preserved,
and no fact tried by a jury shall be otherwise
re-examined in any Court of the United States,
than according to the rules of the common law.Article VIII
Excessive bail shall not be required,
nor excessive fines imposed,
nor cruel and unusual punishments inflicted.Article IX
The enumeration in the Constitution,
of certain rights, shall not be construed to deny
or disparage others retained by the people.Article X
The powers not delegated to the United States
by the Constitution, nor prohibited by it to the States,
are reserved to the States respectively, or to the people.13
Notes
1. Washington Writings, p. 776-777.
2. The Writings of George Washington from Original Manuscript Sources 1745-1799,
Volume 31: January 22, 1790-March 9, 1792, p. 215-216.
3. Alexander Hamilton by Ron Chernow, p. 354.
4. Main Currents in American Thought by Vernon Louis Parrington,
Volume 1, p. 376-377.
5. Washington Writings, p. 780-782.
6. Ibid., p. 782-785.
7. Wilentz, Sean, The Rise of American Democracy: Jefferson to Lincoln
by Sean Wilentz, p. 49.
8. The Writings of George Washington from Original Manuscript Sources 1745-1799,
Volume 31, p. 386-387.
9. Washington Writings, p. 786-792.
10. The Writings of George Washington from Original Manuscript Sources 1745-1799,
Volume 31, p. 404-405.
11. Hamilton’s Report on the Subject of Manufactures, 1791 (On line).
12. Madison Letters, IV: “Public Opinion.”
13. Documents of American History ed. Henry Steele Commager, p. 146.
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