Chapter Overview

The political and social controversy that erupted over a new excise tax on whiskey frames a more fundamental question in the tumultuous 1790s, the first decade of the Republic's existence under the new Constitution. Could the new government unite a socially diverse nation? The "Whiskey Rebellion" thus illustrates a central purpose of the chapter: to describe the basic division in the United States between commercial and semi-subsistence economies, and how this division was central to the development of two competing political parties.

1789: A Social Portrait

As the new government began operation in 1789, the Republic could be said to be divided roughly between commercial and semi-subsistence areas of the country. Hector St. John de Crèvecoeur celebrated the equality that marked semi-subsistence farm families, where wealth was fairly evenly distributed and where people tried to provide as much of their own food and wants as they could. Limited in contacts beyond their local community, they seldom saw cash, functioning in a largely barter economy. Benjamin Franklin, by contrast, symbolized the world of commerce. In his writings, he praised the marketplace and upheld the commercial side of America; he exemplified how urban economies and commercial farm families were tied to larger markets, where specialized goods or services were sold and the social distance between the rich and the poor was more striking.

Americans who participated in the commercial economy held attitudes about wealth and power that were different from those who lived in semi-subsistence areas. Urban merchants and workers as well as commercial farmers had generally supported the Constitution during the debate over ratification, while semi-subsistence farmers had tended to oppose it, fearing too much concentration of power in the hands of aristocrats and urban merchants. Content with their lives and harboring the traditional fear of taxes, debt, and intrusive government, they wanted to preserve their society as it was.

The New Government

Reassuring the more fearful was the prestige of George Washington, who more than any individual personified the Republic. Washington organized the executive branch into departments and created a cabinet of advisors. The most important positions in the cabinet went to Alexander Hamilton, as secretary of the treasury, and Thomas Jefferson, as secretary of state. To mollify opponents of the Constitution, Congress approved and the states ratified a series of amendments to safeguard certain basic liberties. These first ten amendments became known as the Bill of Rights.

A strong nationalist, Hamilton emerged as the cabinet's dominant figure. He worked to strengthen the power of the federal government by assuming the states' remaining Revolutionary war debts and funding, or paying, the outstanding federal debt. Congress finally approved these policies along with the decision to locate the permanent capital on the Potomac River. Eager to tie the wealthy to the new government, Hamilton also proposed that Congress charter a national bank to aid the Treasury in its transactions, a protective tariff to stimulate manufacturing, and a series of internal or excise taxes (the one on whiskey was most controversial). Congress eventually approved most of Hamilton's recommendations. His argument that the Constitution gave the national government implied as well as explicit powers and that the document had to be interpreted loosely persuaded Washington to accept the national bank.

While these ideas appealed especially to citizens active in the commercial life of the nation and in fact produced prosperity, they stimulated fears among other Americans. Eventually the Republican party, organized by James Madison and headed by Thomas Jefferson, opposed the policies of Hamilton's supporters, who retained the Federalist label. Drawing support from the semi-subsistence sector, Republicans still harbored Revolutionary era fears that a corrupt aristocracy would come to dominate American society - that financial speculators, wealthy bankers, and unprincipled politicians would gain power. They endorsed a strict construction of the Constitution, and wanted a less active federal government.

Expansion and Turmoil in the West

Another way to demonstrate the effectiveness of the new government was to strengthen control of the West. Washington dispatched an army that defeated an Indian confederacy, opening new tracts of land in the Ohio Valley to white settlement. Thomas Pinckney negotiated a favorable treaty with Spain that allowed western farmers to use the Mississippi River to ship their produce. Washington also felt compelled to send an army against the citizens in western Pennsylvania who were agitating against Hamilton's excise tax. But the government had overreacted, for the army encountered little resistance and easily restored order.

The Emergence of Political Parties

The ideology of republicanism taught Americans to fear parties. Yet social conditions, which required a mechanism by which diverse groups could voice their views, encouraged parties. Still, it took the sharp controversy over Hamilton's domestic policies to initiate the formation of the first national parties in American history.

Differences over foreign policy were also crucial to the formation of parties. The French Revolution became the focus of controversy in the United States. When monarchical England and revolutionary France went to war, Washington pursued a neutral course. Hamiltonians, however, favored Britain, while the Jeffersonians backed France. Then when efforts to settle the differences between the United States and Britain failed, Jay's Treaty (1795), which tied the nation economically to Britain, provoked bitter debate and further stimulated the creation of rival parties.

Federalists believed in order and hierarchy and supported a loose construction of the Constitution (to allow the federal government to actively encourage commerce and manufacturing). The Republican party of Madison and Jefferson, fearing monarchy and aristocracy, opposed the Federalists. The split reflected the divide between commercial and semi-subsistence America.

In 1796 Washington, wearied by the partisan battles, announced that he would not seek a third term. In America's first contested presidential election, John Adams, the Federalist candidate, defeated Jefferson, who in an odd turn of events was elected vice president. Federalists would hold on to an ordered world a while longer, even as they promoted a more modern economy; Republicans, tied to another suspicion of power, nevertheless would herald future trends toward increasing personal liberty and democracy.

The Presidency of John Adams

Preoccupations with America's role in European affairs continued during the administration of John Adams. France demanded a bribe to stop violating American neutral rights. Adams responded by fighting a naval "Quasi-War." Meanwhile, Federalist-sponsored restrictive legislation - the Alien and Sedition Acts - provoked a Republican assertion that states could block national laws.

Though Adams concluded a satisfactory peace with France, Federalist support eroded due to their opposition to civil liberties and an increasingly fierce personal feud between Adams and Hamilton. Thus, in 1800 Adams lost to Jefferson (although the House had to break a tie between him and his vice-presidential running mate, Aaron Burr) and power passed peacefully to a new administration and party. Yet under Washington's firm leadership the Federalists had made the Constitution a workable instrument of government and established economic policies and principles of foreign affairs (particularly of neutrality) that even Jefferson's Republicans would continue.