Class Notes from January II

Alexander Hamilton and the Banking System

Alexander Hamilton, Secretary of Treasury (1789) -- Hamilton wanted an economy based on paper money that would encourage businesses and industry to grow.
He started taxes and a National Bank in 1791 to manage the nation's money.

First Bank of the United States (1791) -- The Bank was created to handle the financial needs and requirements of the Federal government, which had previously been thirteen individual states with their own banks, money, and policies.
Started by Congress on February 25, 1791, the bank was given a charter with a 20-year expiration date.

Controversy over the Bank -- Based on the loose interpretation (implied meaning) of the elastic clause of the Constitution, the bank was necessary and proper to carry out the government’s duties. Based on this view, when the Constitution grants a power to Congress, it also grants Congress the “necessary and proper” means to carry out that power.

Elastic Clause (From Article I of the Constitution) -- “The Congress shall have Power - To make all Laws which shall be necessary and proper for carrying into Execution the foregoing Powers, and all other Powers vested by this Constitution in the Government of the United States, or in any Department or Officer thereof.”

THE WAR OF 1812

CAUSES, IMPORTANT EVENTS, AND EFFECTS

Significance – This war between America and Britain established the U.S. as a country with an identity when the new country defended its first "invasion," proving it was a powerful force. No territory was gained or lost and there was no clear winner.

Causes of the War of 1812

• Impressment – Forcing foreign sailors into service in the British navy

• Embargo Act (1807) – Congress banned all imports to England. It was intended to hurt England, but actually hurt the U.S. because other nations stopped trading with us. England just found other countries to deal with. It was repealed in 1809.
• British supported American Indian resistance against Americans

Significant Events

Attack on Washington D.C. – In 1814, the British occupied DC and set fire to many public buildings. Dolley Madison saved the Gilbert Stuart portrait of George Washington from the White House

Battle of Fort McHenry – Francis Scott Key wrote poem “Defence of Fort McHenry," from which the “Star Spangled Banner” was written, after witnessing the bombardment of Fort McHenry by the British Royal Navy ships during the Battle of Fort McHenry

Battle of New Orleans – The British decide the war is too costly and unnecessary and signed the Treaty of Ghent to end the war in December 1814. However, word didn’t reach the U.S. in time to prevent the Battle of New Orleans. Forces led by Jackson won the battle, which helped him become our 7th President in 1827.

End of the Federalists – Federalists in New England had been against the war. They were called unpatriotic and fell out of favor after Jackson’s victory.

Foreign policies of Presidents from Washington to Monroe

George Washington -- In his Farewell Address, Washington warned against “getting mixed up foreign affairs.” Declared neutrality when the British and French went to war against each other. He believed the U.S. must remain a neutral third party in order to survive.

John Adams -- Avoided war with France though many disagreed with him.

     •XYZ Affair – Three anonymous French trouble makers brought France and the U.S. to the brink of war

     •Alien and Sedition Acts – Four acts that made it difficult to become citizens and declared restrictions against citizens who criticized the government during war time

Thomas Jefferson -- Tried to avoid foreign involvement, keeping George Washington’s advice to maintain neutrality.

     •Embargo Act 1807 – Prohibited American from trading with foreign nations. The act was intended to prevent American entrance into the Napoleonic war by keeping the ships in American harbors. It failed and hurt the American economy

James Madison – Madison led the country through the War of 1812 and held it together once the capital was destroyed. After the impressment of American sailors, he felt war with England was inevitable because of the rising tide of nationalism. He became the 1^st US President to ask Congress to declare war.

James Monroe – Monroe sought to repair the country’s relations with England while also maintaining America’s neutrality. As further proof he issued the Monroe Doctrine

 Era of Good Feelings (1816-1824) – A period in U.S. political history in which partisan (political parties) bitterness stopped. It lasted through the administration of U.S. President James Monroe, who deliberately downplayed it. A lot may have been due to the absence of the Federalists.