George Washington was elected the United States’ first president and took the oath of office on April 30, 1789. His vice president was John Adams.

The Constitution provided the new country with only a skeleton framework, which had to be elaborated upon and implemented. When Washington took office, no judiciary department existed, meaning that no laws could be enforced. Nor were there any executive posts such as attorney general or secretary of state. Also, no taxes had been set and the navy had been disbanded. During Washington’s two terms as president, from 1789 to 1797, Congress developed the nation’s much-needed legal, bureaucratic, and military machinery.

The first Congress under the Constitution convened in New York City in March 1789. Congress immediately set out to establish a judicial branch, develop the executive branch, set a legislative agenda, and meet the popular demand for a bill of rights. As Congress worked out the details of government bureaucracy and domestic policy, Washington focused primarily on matters of finance, diplomacy, and the military. He interacted very little with Congress. He rarely spoke publicly about policy, suggested few laws, and vetoed only two bills in all eight years of his presidency.

Congress created a court system with the Judiciary Act of 1789. The act established a federal district court in each state, affirmed that the Supreme Court exercised final jurisdiction in all legal matters, and set the number of Supreme Court judges at six. In 1796 the Supreme Court first asserted its power to determine the constitutionality of congressional statutes.

The Constitution only provided the general framework of the executive branch without specifying the number and the duties of executive posts. In 1789, Congress established what came to be known as the cabinet: three executive posts (secretary of state, of war, and of treasury), as well as the office of Attorney General. Washington appointed Thomas Jefferson as secretary of state, Alexander Hamilton as secretary of treasury, Henry Knox as secretary of war, and Edmund Randolph as attorney general.

The Bill of Rights was a concession made by the Federalists to the Anti-federalists, who were concerned that a strong government would usurp the rights of individuals and states. James Madison led the group that drafted the first ten amendments to the Constitution, collectively known as the Bill of Rights, which the state legislatures ratified in December 1791. The Bill of Rights sought to enumerate certain liberties that could not be invaded by the federal government.

The conflict between the Federalists and the Anti-federalists shaped much of the nation’s early political debate and policy. The Federalists, led by Secretary of Treasury Alexander Hamilton, pushed for a strong central government, while the Anti-federalists, led by Secretary of State Thomas Jefferson, advocated states’ rights over central power. Anti-federalists argued that the federal government should be limited to issues of national defense and interstate commerce, with all other powers left to the states. The Anti-federalists were mainly southern and agrarian, while the Federalists were concentrated in the Northeast and represented mercantile interests.

The growing divide between Federalists and Anti-federalists revealed itself most in the debate over national finances. In 1790, Hamilton proposed that the national government assume the unpaid war debts of the states. Anti-federalists believed this plan granted the national government undue economic power over the states. Southern states particularly opposed the plan, since they had already paid off nearly all of their debts while the northern states lagged behind. Despite Southern and Anti-federalist opposition, the plan passed, in part because of a concession by the North to the South: in 1800, the nation’s capital was moved from New York to a southern locale near the Potomac River, present-day Washington, D.C.

Even more controversial was Hamilton’s proposal to establish a national bank. Hamilton claimed the Bank of the United States would provide a secure depository for federal revenue, issue currency and federal loans, regulate the activities of smaller banks, and extend credit to U.S. citizens. Opposing the proposal, Anti-federalists such as Thomas Jefferson feared that the creation of the bank would tie private individuals too closely to government institutions. Anti-federalists also argued that the Constitution did not explicitly give the federal government the power to grant such charters.

This latter argument came to characterize the view of strict constructionists, including Jefferson and James Madison, who believed that the national government should be confined to the powers expressly enumerated in the Constitution—nowhere did the Constitution give Congress the power to grant the bank a charter. Such a strict interpretation of the Constitution, they believed, was necessary to protect against tyranny. In opposition, Hamilton and his followers favored a loose reading of the Constitution, especially of the elastic clause (Article I, Section VIII), which states that Congress shall have the power “to make all laws which shall be necessary and proper for carrying into execution . . . powers vested by this Constitution in the government of the United States.” For loose constructionists like Hamilton, this clause gave Congress the power to do anything not expressly forbidden by the Constitution, including founding a national bank. After much debate between the loose and strict constructionists, Congress approved the bank by a thin margin, granting it a 20-year charter in February 1791.

One final issue dividing Congress concerned protective tariffs. In December 1791, Hamilton proposed the passage of high protective tariffs to generate revenue for the national government and to foster industrial development. Jefferson and Madison both opposed this protectionist economic policy, fearing that industries would become too dependent upon government aid. Many congressmen also opposed the tariff for favoring industrial and merchant interests of the North over the more rural and agrarian South. In the face of such opposition, the tariff bill did not pass.

The framers of the Constitution considered political parties to be self-serving factions detrimental to the good of government. However, by the end of Washington’s term, the division between the strict constructionists and the loose constructionists had hardened into two distinct political parties: the loose constructionists formed the core of the Federalist party, while the strict constructionists comprised the core of the Democratic-Republican party—or, simply, the Republicans.

The birth of the Republican Party can be traced to 1793, when Jefferson resigned from Washington’s cabinet in opposition to Federalist policy decisions, especially the financial decisions of Alexander Hamilton. Republicans attempted to arouse political awareness and spread criticism of Federalist decisions through a media campaign, which centered around America’s first opposition newspaper, The National Gazette. They also founded political societies and clubs across the nation. Washington clearly allied himself with the Federalists in 1794 by accusing the Republicans of inciting the Whiskey Rebellion (discussed below). That same year, the Republicans won a slight majority in the House of Representatives, signaling the arrival of the party as a legitimate political movement.

Led by Jefferson and Madison, the Republicans aimed to limit the power of central government and to expand the rights of states and individuals. They argued that liberty could only be protected if political power rested firmly in the hands of the people and those government officials who were closest and most responsive to the people. The Federalist Party, led by Washington and Hamilton, preferred a system in which elected officials would rule without the direct influence of the people, as part of a very powerful central government. While the Federalists were concentrated in the Northeast, the Republicans had their stronghold in the South.

In July 1794, frontier farmers in western Pennsylvania who produced whiskey from corn violently protested against Hamilton’s 1791 excise tax on domestically produced whiskey. This revolt, which became known as the Whiskey Rebellion, represented the first major test of the national government’s ability to enforce its laws within the states.

Whereas the earlier Shays’s Rebellion exposed the central government’s weakness under the Articles of Confederation, the Whiskey Rebellion revealed the new government’s strength. President Washington responded decisively, leading 13,000 men into Pennsylvania to crush the rebellion. His actions demonstrated the broad reach and commitment of the national government. Many Anti-federalists condemned Washington’s response, saying it was excessively oppressive and favored commercial interests over those of small-scale farmers (since commercial interests benefited most from the excise tax). Overall, the rebellion only strengthened the political power of Washington, Hamilton, and the Federalists. Many frontier farmers did, however, shift their loyalty from the Federalist to the Republican Party. The revolt also further divided the two parties.

During the 1790s, the U.S. attempted to expand its territory westward. The government devised policies for settlement and admitted three new states to the union: Vermont (1791), Kentucky (1792), and Tennessee (1796). Such expansion efforts incited opposition from Spain and Britain, both of which still owned some western territory and wanted to own more. Native Americans who inhabited much of this coveted land also resisted U.S. expansion. Military efforts in 1790 and 1791, aimed at forcing peace with the Native Americans on U.S. terms, yielded little success. The tense relations continued in stalemate until 1794, when U.S. troops routed a group of Native American warriors at the Battle of Fallen Timbers. After this defeat, 12 Native American tribes signed the Treaty of Greenville, which cleared the Ohio territory of tribes and opened it up to U.S. settlement.

Throughout his term in office, Washington worked to preserve U.S. neutrality in international relations. By keeping the U.S. out of European conflicts, he hoped to develop and enhance U.S. domestic policy and unite the nation under one strong, efficient government. Foreign affairs, however, grew increasingly difficult to ignore. The French Revolution (1789-1799) inspired opposing loyalties within the federal government. Jefferson and other Republicans sympathized with the revolutionary cause, which championed individual rights against the aristocratic government. Hamilton and other Federalists opposed it.

In 1793, when revolutionary France went to war with Britain and Spain, U.S. loyalties were again divided. Northern merchants pressed for a pro-British policy, mostly because of trade interests, while Southern planters pushed for an alliance with France. Refusing to be drawn into the war, Washington issued the Proclamation of American Neutrality. Although neutrality was the national policy, Southwestern settlers offered some military support to the French against the Spanish in Florida and in the Mississippi Valley, and 1,000 Americans enlisted with the French as privateers, terrorizing the British navy. The British navy retaliated by seizing more than 250 American vessels during the winter of 1794, forcing their crews into service in the Royal Navy through a policy known as “impressment.” Tension flared further when Canada’s royal governor denied U.S. claims to the land north of the Ohio River and encouraged the Native Americans in the region to resist expansion. War seemed almost inevitable as the British and Spanish troops began building forts on U.S. territory.

Desperate to avoid war, Washington dispatched negotiators to the warring European nations. John Jay negotiated Jay’s Treaty (1795) with Britain, which secured the removal of British troops from American land and reopened very limited trade with the British West Indies, but he did not address the British seizure of American ships or the “impressment” of American sailors. Although criticized by many Americans, especially Anti-federalists, for being too beneficial to Britain, Jay’s Treaty did keep the U.S. out of a potentially ruinous war against a stronger and more established nation. Thomas Pinckney negotiated the Treaty of San Lorenzo (1795) with Spain, which granted the U.S. unrestricted access to the Mississippi River and removed Spanish troops from American land.

In 1796, Washington retired from office, deciding not to run for a third term. He thereby set the precedent of presidents serving no more than two terms in office—a precedent that became law with the ratification of the Twenty-Second Amendment (1951). In his farewell address, Washington implored future generations to avoid embroilment in the affairs of other nations, and to concentrate on the creation of “efficient government” at home. He warned that the development of parties would destroy the government, fearing that special interest groups and foreign nations would come to dominate the two factions.