The First Two American Political Parties

Word Version

The Federalist Party organized itself around a “nation building” program developed by Alexander Hamilton. As Washington’s Treasury Secretary, Hamilton made bold proposals to help the US grow into major trading and manufacturing leader. Most Federalists were not in favor of expanding voting rights. They did not tend to believe in social equality.

Jeffersonians feared a government with too much power to tax. Many rich plantation owners feared a government strong enough to limit or abolish slavery. The Jeffersonians were excellent political organizers who knew how to speak the language of democracy and appeal to the “common man”

Federalists The Federalist party organized to support the ideas of Alexander Hamilton and to oppose the ideas of Jefferson. Hamilton believed that the US would achieve prosperity by building up cities, trade, and manufacturing. He believed in a strong central government that had solid support from the wealthy and talented. He believed this kind of government should actively support the growth of business and trade.

Jeffersonian (Democratic) Republicans The Democratic Republicans (today known as the Democratic Party) organized to support the ideas of Thomas Jefferson, but mostly to oppose Hamilton’s plans. Jefferson believed that the Federal Government should be kept as weak and small as possible. He emphasized states rights. He believed the best way to preserve freedom and dignity for the common man was to promote land ownership. His ideal citizenship would be made up of white, independent, educated, small farmers.

Generalizations about the Federalist Party ¨ Emphasized nationalism/feared states rights ¨ favored a strong centralized government, not states rights ¨ believed that the success of the US government depended on the support of the rich and talented ¨ feared and distrusted the excesses of democracy ¨ favored a strong central government, with a loose interpretation of the Constitution ¨ advocated Hamilton's financial program ¨ favored encouragement of industries ¨ favored attention to the needs of the great merchants and landowners ¨ favored the establishment of a well-ordered society. ¨ pro-British in foreign affairs (because Britain was our major trading partner and because they feared the excesses of the French Revolution), ¨ supported by wealthy merchants and bankers, big property owners - especially in the North, conservative small farmers and businessmen. ¨ Concentrated in New England, but had support in the Middle Atlantic States.

Generalizations about the Jeffersonians ¨ Emphasized limited government and states rights ¨ Favored a strict interpretation of the constitution ¨ Made deliberate appeals to smaller property holders and tradesmen ¨ Feared the growth of cities and an economy based on manufacturing ¨ Favored expanding voting rights to more men ¨ Favored France over Britain ¨ Concentrated in the South with strong support in the Middle Atlantic States ¨ Strong support from small farmers, small businessmen and large slaveholders After Jefferson took office in 1801 he: ¨ Sharply reduced government spending ¨ slashed military spending (he reduced the army to 3000 soldiers and 172 officers and the navy to 6 frigates ¨ Eliminated taxes on whiskey, houses, and slaves firing all federal tax collectors. ¨ Cut foreign embassies to 3: Britain, France, and Spain. ¨ Encouraged land ownership and western settlement by persuading Congress to cut the price of public lands and to loan money to land purchasers.

Both parties supported westward expansion. Neither party opposed slavery.

A note on “Conservativism”

If one keeps in mind English traditions of class and privilege in the 1700’s, the word “conservative” in the sense of “tradition minded” can be applied to Federalists. By the 1790’s slavery was disappearing from the Northern states. The “money economy” was growing and temporary white servitude (usually based on debt) was being replaced by wage labor.

Many people felt threatened by these kinds of changes. Some smaller farmers and businessmen grew up with dreams of being like the English gentry. They may have fought against the King and Parliament, but they kept certain attitudes from their English heritage. They didn’t like hearing talk about “equality” from people they saw as inferior. Stories about the French Revolution kept them awake at night.

Jeffersonians called Hamilton’s plans “radical” because plans would have encouraged the growth of the money economy even more. But to Federalists, Hamilton was only following the model of Great Britain. England was already the world’s leading trading and manufacturing nation.

Hamilton’s Financial Proposals

I. Managing the National Debt

The United States was born in blood and a sea of “red ink”. The new nation owed huge debts to foreign governments like France. Hamilton refinanced that debt by having the US issue new bonds with longer terms. He especially wanted the governmental debt to be owned by American citizens and American banks, but he knew that anybody (or any country) who was owed money by the new US government would not want to see it fail.

Hamilton’s system of debt management continues to this day

II. The Bank of the US

Hamilton argued that a bank was necessary to manage the government’s revenues. A central bank could also direct investments to encourage trade and manufacturing.

Jefferson argued the Bank was unconstitutional because it was not explicitly authorized by the text of the Constitution.. This is a “strict” way of interpreting the Constitution. Hamilton won the argument by pointing out that the constitution did not prohibit a bank. This is called “lose” interpretation of the constitution.

The Second Bank of the US became the basis of an important Supreme Court case: McColloch v. Maryland which finally established that the bank was constitutional but the Bank was always very unpopular. That is why today we have a “Federal Reserve System” instead of a “Bank of the US”

III. Tariffs and Manufacturing

Hamilton proposed a protective tariff – a tax on foreign goods to make them more expensive than products made in the US. This would help American manufacturers compete with more established British manufacturers. Hamilton believed this would give the US economic independence.

He lost this argument. Congress would only pass a tariff high enough to provide steady revenue but not high enough to discourage Americans from buying British goods. America would depend on manufactured goods from Britain until the War of 1812 and the embargos that lead up to it.

Protectionism v “Free Trade” continues to be an issue in national debate and elections.

Use the table and following text to complete the following sentences with the words Federalists or Jeffersonians

_______________________ supported a protective tariff.

_______________________ advocated democracy and social equality.

_______________________ advocated for more widespread voting rights.

_______________________ most wealthy bankers.

_______________________ expressed sympathy for the French Revolution (at least in its early stages).

_______________________ argued for the lowest possible taxes.

_______________________ defended States rights.

_______________________ preferred a loose interpretation of the Constitution.

_______________________ supported a Central Bank.

_______________________ more likely to value respect for traditional authority.

_______________________ included most large slave owners.

_______________________ included most small farmers.

_______________________ were better at electoral politics

Use the table and following text to answer the following questions as completely as possible.

1. What motivated people who supported the Federalist Party?

2. Name two reasons the Jeffersonians wanted to keep the Federal government weak and limited.

3. In the end the Jeffersonians defeated the Federalists. What reasons could historians give for this?

4. Write three words that are important for a historical understanding of the conflicts between Federalists and Jeffersonians in the 1790’s.

i.

ii.

iii.

5. Although the Jeffersonians defeated the Federalists in electoral politics, many historians believe that the Federalists’ ideas were victorious in the end. Why would they say this?

6. If someone wanted to know what a “loose interpretation of the Constitution” meant, where would a reader find the most help?

a) In the table column about the Jeffersonian Democratic Republics

b) In the section on “The Bank of the US” under Hamilton’s financial plans

c) In the section on “Managing the National Debt” under Hamilton’s financial plans

d) In the section with the heading: “A note on Conservativism”