The Washington Administration

George Washington doubted his own ability to lead the new nation he had helped to create. He was not a profound political thinker like Adams, Jefferson, or Madison, and he knew it. However, he had a characteristic unique among all presidents who followed him—he was the universal choice of all the political leaders of the day. Washington commanded profound personal respect and affection from everyone who knew him and had worked with him. His popularity was an important unifying factor in the success of the new nation for its first eight years.

Washington’s first action was to decide on the title by which the nation’s chief executive should be addressed. His choice, “President of the United States,” reassured everyone that the United States would never turn into a monarchy. The title was a simple one and reinforced the notion that the president was no more exalted than any other American citizen.

John Adams served as Washington’s vice president. The first Supreme Court had a chief justice, John Jay, and five associate justices. The first presidential cabinet contained only five members, as follows:

Secretary of State Thomas Jefferson
Secretary of the Treasury Alexander Hamilton
Secretary of War Henry Knox
Attorney General Edmund Randolph
Postmaster General Samuel Osgood

The Nation’s Economy

Alexander Hamilton quickly achieved a prominent position in the administration. Hamilton believed in capitalism—the economic system preached by Scotsman Adam Smith, in which free-market competition determines wages and prices, and ownership of industries and businesses is in private hands. Hamilton’s agreement with Smith’s philosophy is largely responsible for the way the American economy took shape.

Hamilton’s first challenge was to pay off the national debt, which had soared to $77 million because of the war. He felt that it was important to pay the debt rather than allowing it to mount, so that the nation would have good credit with the rest of the world. Hamilton’s plan involved selling new bonds to pay off old ones. He also declared that the federal government should be responsible for debts the states currently owed. Since the southern states had already paid their debts, they protested, arguing that the northern states should be forced to pay too. Hamilton compromised with southern leaders by agreeing that the government would move the nation’s capital to the South. They would build a new city, the District of Columbia, on a small parcel of land carved from the Maryland-Virginia border. For security reasons, and to prevent jealousy among the states, the capital would be a free city outside state borders. The new capital was renamed Washington, in honor of the first president. George Washington himself never lived in Washington, DC; when the district was marked off for the capital, it was nothing but farms and woodlands. The city, with the required government buildings, had yet to be planned and built.

Congress created the Bank of the United States in 1791. Its charter stated that it was to be jointly owned by the government and private investors, and that it would operate for 20 years. Congress also created a mint, which began to produce the first U.S. coins in 1792. Before this date, each state had printed its own currency.

Hamilton continued to cast about for ways to settle the government’s debts. As many political leaders throughout history had done when in debt, he established new taxes. A new tax on whiskey provoked an uprising among farmers in western Pennsylvania; it would take away the handsome profits they had been making by turning their surplus grain crop into whiskey and trading it for supplies. When marshals tried to collect the tax from the Pennsylvania farmers, the farmers resisted. They attacked the officials and planned a march of about 6,000 men on Philadelphia, the nation’s temporary capital. Washington called out the militia to put down the Whiskey Rebellion.

Foreign Policy

Meanwhile, the Indians in the Northwest Territory were fighting to defend their lands from the encroaching Americans. Led by Miami chief Michikinikwa (“Little Turtle”), more than 1,000 Indians of various nations banded together and soundly defeated the Americans in a battle along the Wabash River. Washington responded by sending a larger militia west and putting General Anthony Wayne in charge. In 1794, the Americans defeated the Indians in the Battle of Fallen Timbers. In 1795, the Americans and Indians signed the Treaty of Greenville, which paid the tribes $20,000 for lands in the areas that would become Ohio and Indiana.

In 1789, revolution broke out in France. George Washington, believing that the U.S. army was unprepared to go overseas and fight, stated in 1793 that the United States would remain neutral. This decision was not popular either abroad or at home. The French resented it, since they had come to the Americans’ aid during the American Revolution; many Americans opposed it for the same reason.

The British were also causing the new nation plenty of trouble. First, British ships frequently impressed Americans into service in the British navy. Second, Britain had seized a fleet of American ships in the West Indies, falsely claiming that those ships were trading with France. Third, the British were arming the Indians in the Northwest Territory against the Americans. Although the British agreed to abandon their North American forts in Jay’s Treaty (1794), the practices of impressment and arming the tribes continued.

When Spain joined France against its longtime enemy Britain, the United States was able to sign Pinckney’s Treaty with Spain. This treaty recognized the 31st parallel as the American border with Spanish Florida, and granted the United States navigation rights along the Mississippi River.

Washington was reelected easily in 1792. In 1796, he announced that he would retire at the end of his second term. On leaving office, he urged his successors to “observe good faith and justice toward all nations” but to “steer clear of permanent alliances with any portion of the foreign world.”

Political Parties

The nation’s first political parties developed during the Washington administration. Washington himself disapproved of political parties; he remains the only president in American history not to represent or belong to one. Factions—the seeds of all political parties—developed quickly around cabinet members Jefferson and Hamilton, who were at odds on most major issues during the administration. Hamilton believed in a strong central government; Jefferson felt that most powers should be left to the states and the people. Hamilton believed in encouraging business and industry; Jefferson felt that agriculture was the most important part of the economy. Hamilton argued that the Constitution had a built-in elastic clause so that laws could be changed or added to suit changing times; Jefferson claimed to be a strict constructionist who believed in the letter of the Constitution. Hamilton wanted an alliance with Britain; Jefferson wanted an alliance with France. Hamilton’s supporters called themselves Federalists. Jefferson’s adherents called themselves Democratic-Republicans.

Practice questions for these concepts can be found at:

Establishing a New Nation and the First Four Presidents Practice Test

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The Washington Administration