During Jeffersons absence, the Constitution had been drafted, debated, ratified and made law. Under its provisions, George Washington was elected President in New York in the spring of 1789, with John Adams as his vice president. Deep in debt from the formative years of union, Washington looked to emerge from the financial crisis by tabbing New Yorker Alexander Hamilton as Secretary of Treasury. To organize foreign diplomacy, Washington named the returning Jefferson as Secretary of State.
Jeffersons original plan had been to take a furlough at Monticello and then to return to France, but faced with the weight of this important responsibility, he was forced to reconsider the matter. There was widespread support for his appointment in political circles, and though the local population wished him for Jefferson to return to the Virginia Assembly, his close friend and adviser James Madison fully encouraged him to accept Washingtons offer. After two months of debate, Jefferson reluctantly agreed to become the first Secretary of State, thus abandoning his dreams of a return to France.
However, before Jefferson reported for work, he played host at the wedding of his eldest daughter Patsy, who had become engaged to marry her distant cousin Thomas Mann Randolph shortly after arriving at home. Jefferson fully approved of his daughters choice, and the festivities were a most happy occasion. It was a marriage that would eventually produce twelve grandchildren for Jefferson. Randolph, although later tinctured by the stain of alcoholism, would work closely with Jefferson in the management of the family estate down through the years. In establishing the family connection, Jefferson deeded one thousand acres and twenty-five slaves to his new son-in-law, thus passing on the legacy of slavery to the next generation.
En route to fulfill his new position, Jefferson drove through a fierce snowstorm, stopping at Philadelphia to visit an ailing Benjamin Franklin, who was to die shortly thereafter. Finally, in March of 1790, Jefferson was sworn in as Secretary of State in New York, a full year after the rest of the administration had been installed. Apart from Hamilton, the other important members of Washingtons cabinet included Secretary of War Henry Knox and Attorney General Edmund Randolph, Jeffersons cousin. While Jefferson was fully equipped to execute his duties, he was displeased to find himself within the well-oiled machine of a functioning bureaucracy.
From the first, Jefferson found himself with a crisis on his hands. Amidst competing claims for territory in the San Juan Islands of the Pacific Northwest between Britain and Spain, the United States was courted by both sides as a potential ally. These two powers were also in a back-and-forth battle over Florida, struggling to gain the upper hand in developing an American empire. Jefferson felt that a policy of non-alliance would suit the United States best, as it would allow the emerging nation to trade with both sides, boosting the domestic economy without creating any obligatory foreign ties. In addition, he was wary of the British, and thus outraged to learned that Hamilton had usurped his role by engaging in secret negotiations with a member of Parliament.
This was just the beginning of the dispute between Hamilton and Jefferson. They worked together most conspicuously in arranging the Assumption Plan, by which the new federal government would assume all debts previously held by national and state governments. The southern states, being less indebted, were initially hostile to this plan, but eventually acquiesced in exchange for a shift in the nations capital from New York via a ten-year layover in Philadelphia to an eventual site on the Potomac River. Jefferson, who masterminded this exchange, felt at the time that the costs of assumption were a small price to pay in the interests of a shift of federal power from the north to the south. He would later come to regret this bargain, as it greatly increased the power of the federal government over the states.