George Washington (1732-99) commanded the Continental Army in the Revolutionary War and served as the first US president from 1789-97. During his two terms, he backed the key economic and financial initiatives of his Treasury secretary, Alexander Hamilton, including the First Bank of the United States .
Washington, born into a slave-owning Virginia family, became a hero to the young nation for his leadership in the war for independence against Great Britain. During the tumultuous years following the Revolution, he was regarded as a unifying leader above the fray, which led to his role in presiding over the 1787 Constitutional Convention. After winning a unanimous Electoral College vote in 1789, his reputation as a neutral arbiter helped, for a while, keep the deep political fissures in his administration from breaking open, notably between Hamilton and Secretary of State Thomas Jefferson.
Nonetheless, Washington generally sided with Hamilton on the major economic initiatives of his presidency. Perhaps most critically, Washington decided to give his backing to Hamilton’s proposal for a Bank of the United States in early 1791. (Appearing undecided, he consulted his cabinet and waited ten days before signing the bill.) This move was strongly opposed by Jefferson, James Madison, and their fellow “Democratic-Republicans,” who argued the Constitution did not explicitly authorize it; furthermore, many Southern planters feared it would empower Northern commercial interests at their expense. Indeed, at the end of Washington’s first term, Jefferson resigned, fearing that Hamilton’s power was entrenched. Those disputes led to the creation of the two-party system as the Democratic-Republicans and the Federalists grew further apart.
In his second term, one of Washington’s greatest challenges was putting down the Whiskey Rebellion in 1794. The federal government had imposed the tax in 1791 to find an alternative revenue source to tariffs in order to fund the military, but it proved deeply unpopular in the hinterlands. Once militias began organizing, Washington and Hamilton led troops into the heart of the rebellion, in western Pennsylvania, where the revolt was subdued quickly and without bloodshed. Although the tax was later repealed during Jefferson’s administration, the episode is now seen as one of the key turning points in the federal government’s consolidation of power.
After his presidency, Washington retired to his estate in Mount Vernon, Virginia, but remained engaged as a public figure by helping President John Adams plan an army in the event France invaded. He was still viewed as a unifying leader for the young country when he died in 1799.
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Ferling, John E. The First of Men: A Life of George Washington. Knoxville: University of Tennessee Press, 1988.
Leibiger, Stuart. Founding Friendship: George Washington, James Madison, and the Creation of the American Republic. Charlottesville: University Press of Virginia, 1999.
Krom, Cynthia L., and Stephanie Krom. “The Whiskey Tax of 1791 and the Consequent Insurrection: ‘A Wicked and Happy Tumult.’” Accounting Historians Journal vol. 40, no. 2 (December 2013): pp. 91-113.
Written by the Federal Reserve Bank of Richmond. See disclaimer.