Chapter 10.2 Alexander Hamilton vs. Thomas Jefferson

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Chapter 10.2 Alexander Hamilton vs. Thomas
Jefferson

• Thomas Jefferson trusted the people to fix their
  own problems

• Hamilton wanted a government strong enough to fix
  Americas problems

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Do these people look happy or mad?
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Now that President Washington is in office

• Its time to fix the economy
• Whats the problem?
• Our government had a national debt of 81.5
  million dollars!
• Amount of owed by our country to other people
• Foreign countries
• Citizens we borrowed money from
• What happens if we dont pay these people back?

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Debate over settling the debt

• Thomas Jefferson

• Alexander Hamilton

• Wanted to pay back all bonds sold to citizens
  over time!
• Bonds certificates purchased that can be turned
  in for more money in the future
• Why did Hamilton want to do this?
• Government gains credibility with the people

• Ok with Hamiltons ideas, but there is a problem
• Speculators have bought bonds from citizens for
  less than they are worth!
• Now the government is going to buy them from the
  speculators for full price?
• That cheats the original owner out of money!
• Who wins?
• Hamilton!
• 1790 Government starts buying bonds back!

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Debate over Paying off debt owed by States from
the American Revolution

• Alexander Hamilton

• Thomas Jefferson

• Argued that government should pay states debt off
• Why?
• We all fought for freedom.
• So, our federal government should pay the bill.
• So who wins?
• Both.sort of.

• Felt each state should pay back their part of the
  bill
• Why?
• Some states owed a lot!
• Massachusetts
• New York
• Some did not owe much at all
• Virginia
• North Carolina

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They both get something in the end.

• Hamilton

• Jefferson

• Federal government pays off the states debt.
• In exchange for.

• The nations capital moves from the North to a
  more Central location.
• The birth of Washington, D.C.
• Will be built as the new nations capital!

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New York to Washington DC
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Washington, D.C. 1800
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Washington 1850
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Washington DC today
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Debate over Role of Government

• Hamilton

• Jefferson

• Had little faith in the average citizen
• Said they could not be trusted to do the right
  thing.
• Why?
• Because the average American does not take
  education seriously
• They take politics even less seriously
• So, you need a large government
• Job protect the liberties of all citizens
  equally

• Had a lot of faith in the average citizen
• Said they should govern themselves
• Said they would educate themselves and do what is
  right
• So, government needs to be small
• Job stay out of the way

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Debate over how the Economy should grow

• Hamilton

• Jefferson

• Government should give stimulus money to
  American entrepreneurs
• Why?
• So they could start their own factories and
  businesses
• Hire people
• Make products here in USA
• Government should pass protective tariffs
• Tax on goods from other countries

• Government should stay out of the economies way
• Why?
• America is made up of farmers!
• They know how to do it themselves!
• Dont need any help!
• Tariffs should remain low
• Why?
• Keep price of goods lower.
• Helps citizens be able to afford them

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Debate over a national bank

• Hamilton

• Jefferson

• Hated the idea of a national bank
• Why?
• Some states are richer than others
• They would lose this power if the federal
  government owned all of the money
• What is the big deal?
• The Constitution does not give the government the
  right to make a bank anyways.
• Or does it?

• Wanted to start a national bank.
• Why?
• So that the government can make their own money
• No more state money
• What is the big deal?
• Federal government would own all of the money in
  America!
• Not each individual state

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What does the Constitution say?

• Article I, Section 8
• Congress has the right to make all laws that are
  necessary and proper
• Hamilton (loose)
• Says a bank is necessary for future growth as a
  nation
• Jefferson (strict)
• Says a bank is convenient
• Not necessary

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Who wins?

• Washington agrees with Hamiltonagain.
• Bank of the United States
• Created in 1791
• For 20 years
• If it works we will keep it longer
• If not, we get rid of it.

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Meanwhile

• While America is trying to build itself into a
  great country.
• A great country is trying to destroy itself.
• 1789
• France decides to have their own Revolution
• Replace their monarch with a democracy like
  America.

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Review Questions

• What is the national debt?
• What are bonds?
• What was Hamiltons idea to fix the economy?
• What was Jeffersons idea for the role of
  government?