The political parties in the US developed due to differing responses to the events of the early 1790s. Federalists shuddered at the thought of disorder, and thought events such as the Whiskey Rebellion, or, in France, the French Revolution, proved that if left with too much power the people would foster disorder and rebellion against the government. Republicans, on the other hand, rejoiced in the Whiskey Rebellion and French Revolution as assertions that the true source of political power was the population at large. Observing the actions of the Washington administration, especially of Alexander Hamilton, republicans became convinced that the assumption of broad power by the central government would only foster inequality and misery among the people of the separate states.
More than anything else, the division of the nation into political parties exemplified the growing rift between North and South. The conservative, industrial North was decidedly Federalist, while the more liberal and agricultural South was overwhelmingly Republican. Historians most often attribute this split to the differing economic modalities of the regions. Clearly, the industrial North was far more supportive of Hamilton's financial policy, which benefited merchants and shippers more than others. However, perhaps more important in the division into parties were the differing social concerns that grew out of industrial and agricultural economies. In the North, as in every industrial economy, those with economic power sought to protect that power from those who did not have as much, namely the masses in the workforce. Thus, to the powerful businessmen of the North, an ideology that closely linked the wealthy to the government and put political power in the hands of elites who were free from the influence of the masses sounded very attractive. In contrast, the workforce in the South was made up primarily of slaves, with no chance to rise in the economic ranks and vie for the power of the plantation owners. Moreover, southern plantation owners did not have an antagonistic relationship with small farmers. To the contrary, they trusted their abilities to be elected by the small farmers and to lead them in peace, should they be given the chance. Thus, for southerners, an ideology that placed the power of the government in the hands of the people did not seem dangerous; it seemed logical.
Washington's Farewell Address was a direct response to the fractioning of the American people. From a clearly Federalist point of view he extolled the virtues of neutrality. He pleaded for American political neutrality, that citizens not be forced to choose between political alternatives, but rather choose their leaders on the basis of merit and reputation. He further pleaded for international neutrality, exhorting Americans to avoid "political connection" with Europe, hoping such avoidance would remove the divisiveness of foreign policy from the American political dialogue and allow US leaders to concentrate on domestic goals. While he could not stop the rise of political parties, which had already become a fact of American political life, his plea for neutrality and vision of an isolated America would inform American foreign relations into the twentieth century.