JOHNSTON, A., Union and Democracy, ch. II.

MCLAUGHLIN, A. C., The Confederation and the Constitution, ch.

XVII.

MCMASTER, J. B., History of the People of the United States, I, ch. V.

SPECIAL TOPICS FOR TEACHERS

1. Formation of the Constitution. BEARD, C. A., American Government and Politics, chs. I-IV; GUITTEAU, W. B., Government and Politics in the United States, chs. XVIII-XXIII, XXV, XXVIII; HART, A. B., American History Told by Contemporaries, III, chs. IXX; LANDON, J. S., Constitutional History and Government of the United States, ch. VI; MCLAUGHLIN, A. C., Readings in the History of the American Nation, chs. XV-XVIII; SPARKS, E. E., The United States, I, ch. V.

2. Adoption of the Constitution. GUITTEAU, W. B., Government and Politics in the United States, ch. XIX; LANDON, J. S., The Constitutional History and Government of the United States, ch. VII ; SPARKS, E. E., The United States, I, ch. VI.

REFERENCES FOR PUPILS

GUITTEAU, W. B., Preparing for Citizenship, ch. XIII.

SPECIAL TOPICS FOR PUPILS

1. Framing the Constitution. ELSON, H. W., Side Lights on American History, chs. II, XVIII; Great Epochs in American History, IV, pp. 31-37; HART, A. B., Formation of the Union, ch. VI.

2. The Inauguration of Washington. BARSTOW, C. D., A New Nation (Century Readings), pp. 3-24; ELSON, H. W., Side Lights on American History, ch. III; Great Epochs in American History, IV, pp. 51-64.

CHAPTER XVIII

SETTING THE NEW GOVERNMENT IN MOTION

The Task of Organization. “I walk on untrodden ground," wrote Washington, soon after his inauguration. There were indeed no precedents for the President or Congress to follow. Each new step must be taken carefully, for the destiny of the young Republic hung on the outcome. The President and Congress had before them the task of creating executive departments, organizing a judicial system, restoring the public credit, managing domestic affairs, and regulating our dealings with foreign nations. Thus great difficulties had to be met by our first President, then in his fifty-seventh year. His task was harder than any he had ever undertaken, but he worked at it with unceasing diligence, and made a splendid success of his administration. Only the hero and sage of the Revolution could have successfully laid the broad foundation on which the American nation has been built. Washington was able to do this because he alone had the full confidence and trust of the people. Indeed, had not the people felt certain that he would be our first President, the Constitution itself would probably not have been adopted.

The President's Social Relations. Washington wisely decided that the President should be under no obligation to make or return social calls. He held a public reception every Tuesday afternoon, at which every one was required to wear full dress. His own dress on these occasions is thus described by a contemporary: "He wore his hair powdered and gathered behind in a silk bag. His coat and breeches were of plain black velvet; he wore a white or pearl-colored vest and yellow gloves, and had a cocked hat in his hand; he had silver knee and shoe buckles, and a long sword with a finely wrought and glittering steel hilt.

The coat was worn over this sword, which had a scabbard of finely polished leather."

Washington received his guests with a formal bow, but did not shake hands at his receptions, even with his intimate friends. He gave one public dinner each week, to which were invited the high government officials, members of Congress, and distinguished citizens. The

fare was simple, and after dessert the President rose and led the way to the drawing-room. Mrs. Washington held receptions on Friday evenings, and at these the President " appeared as a private citizen, with neither hat nor sword; conversing without restraint and generally with ladies." The company was expected to retire early. "The general retires at nine, and I usually precede him," Mrs. Washington would say.

Boston.

The Executive Departments. To assist the President in carrying on his work, Congress created three executive departments: the Department of State, the Department of the Treasury, and the Department of War. At the head of each was a Secretary, appointed by the President. For Secretary of State, Washington chose Thomas Jefferson; for Secretary of the Treasury, Alexander Hamilton; and for Secretary of War, General Henry Knox. Edmund Randolph was appointed Attorney-General, as the chief law officer of the new government was called.

The National Courts. The judicial machinery of the government was set in motion when Congress passed an act establishing

a system of national courts. The highest of these was the Supreme Court of the United States, consisting of a Chief Justice and five Associate Justices. President Washington appointed John Jay of New York as our first Chief Justice. The three great departments of government were now organized, and ready for business. There was a Congress, consisting of the Senate and House of Representatives, to make the laws; a President, aided by four chief executive officers, to enforce these laws and carry on the work of government; and there were national courts to hear and decide cases arising under the Constitution and laws of the United States.

The Financial Problem. The most difficult problem before the new government was the question of finance. The heavy expense of the Revolution had put the country deeply in debt. The old Confederation government could not raise the money needed for its ordinary expenses; much less could it pay the interest on the public debt. Always a pauper, the Confederation in its later days became a bankrupt. The new government inherited its debts, and found that the national credit at home and abroad was almost destroyed.

The first Secretary of the Treasury, Alexander Hamilton, was appointed to this post at the age of thirty-two years. Washington loved and trusted him, and Hamilton's genius for finance soon proved the wisdom of his choice. Hamilton refused to listen to those who suggested paying a part of our immense debt, and letting part of it go unpaid. He told Congress that the new Republic must arrange to pay every dollar of its indebtedness. At this time we owed to foreign creditors, chiefly in France and Holland, nearly $12,000,000, and to creditors in the United States $42,000,000. Interest to the amount of many millions remained unpaid. It was of course impossible to pay all of this debt at once. So Hamilton planned to issue new bonds for the entire amount, and exchange these for the old certificates of indebtedness. Each year the interest on these bonds, and a part of the principal, was to be paid out of revenue raised by taxation.

How the State Debts Were to be Paid. Hamilton also proposed that the national government should assume the debts of the

thirteen state governments, amounting to about $21,000,000. He argued that the state debts were the result of fighting for the common cause, and should therefore be paid by all. Moreover, to assume the state debts would strengthen the Union; it would enlist the support of a large class of creditors who would wish the national government to succeed in order that their claims might be paid. Some states, especially those at the South, had small debts and were therefore opposed to this policy. The plan seemed doomed to defeat; it was finally carried by means of a political bargain or "deal." A permanent location for the national capital had not yet been chosen. Northern members of Congress wanted to have the capital at Philadelphia; southern members wanted it on the Potomac River. Finally, Hamilton made a private agreement with Jefferson. Hamilton promised to persuade several northern Congressmen to vote to locate the capital on the Potomac; Jefferson in turn was to secure the votes of Virginia's Representatives for the plan of assuming the state debts. Both measures were then carried through Congress.

For ten years (1790-1800), the seat of government was to be at Philadelphia, after which it was to be permanently located at some point on the Potomac. In 1790, Maryland and Virginia ceded to the national government a tract of land ten miles square, lying on both banks of the Potomac. The Maryland portion of the "District of Columbia " became the seat of the national government; the part on the southern bank of the river was afterwards given back to Virginia.

The First Bank of the United States. Hamilton's third financial proposal was that Congress should charter a national bank, in which the government was to own one fifth of the stock. This bank would aid the government in making loans and in the collection of taxes. Then, too, the bank was to issue notes or bills, which every one would accept at face value on account of its high standing. In return for its services to the government, the public funds were to be deposited with the bank, which might loan them out at interest just as it loaned the deposits of individuals. The bank measure was vigorously opposed by