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CHAPTER II.

HISTORY UNDER PRESIDENT

WASHINGTON, 1789-1797.

LTHOUGH Congress was organized on April 6, 1789,

Washington was not inaugurated until April 30. The Speaker of the First House of Representatives was Frederick A. Muhlenberg, of Pennsylvania. Its membership numbered fifty-nine, and its sessions were public. The Senate had, as yet, but twenty members, and sat with closed doors. The first need of the new government was revenue, hence the first real business brought before the House was a proposition introduced by Madison, April 8, before the arrival and inauguration of the President, to raise a revenue by duties on imports and by a tonnage duty on all vessels.

The debate on this, the first tariff bill, was continued for many days, and is full of interest and instruction. Madison, while earnestly and repeatedly avowing that "Commerce ought to be as free as the policy of nations will admit,” and "labor and industry left at large to find its proper objects," was not unwilling to adjust duties so as to favor the "infant manufactories" of the country; and the preamble of the act, as it finally became a law July 4, 1789, recited as one of its objects "the encouragement and protection of manufactures." But neither in this re

cital, nor in the debates on the bill, nor in the rates finally agreed upon, can we find countenance for the views and policies of those who champion the existing protective system. Revenue was uniformly declared to be the chief object of the duties laid, and where protection was made incidental to it, the rates asked or agreed upon were so moderate that they would excite the derision of our latterday protectionists.

The statesmen who framed our first tariff bill-Madison, Fisher Ames, Roger Sherman, and their associates-always spoke of the duty imposed upon an article as a tax, and as a tax to be paid by the consumer. "The merchant," said Sherman, "considers that part of his capital applied to the payment of the duties the same as if employed in trade, and gets the same profit on it as on the original cost of the commodity."

Hence a leading idea was to adjust the items of the tariff so as to make it bear evenly on localities and be just in its burdens on individuals; for "I readily agree," said Madison, "that in itself a tax would be unjust and oppressive that did not fall on the citizens according to their degree of property and ability to pay it." Spirituous liquors were conceded to be proper subjects of high taxation, both for the sake of revenue and in the interest of temperance. It was inevitable that sectional interests and opposing views should come into collision in the debate, but no divisions into parties were discernible in these discussions.

The agricultural members wanted steel free, but Clymer, of Philadelphia, said there was a furnace in that city which,

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with a little aid from the State, had produced 300 tons in two years, and so a duty of fifty cents per hundredweight was imposed on unwrought steel, and five per cent. generally on manufactures of steel. The salt duty gave rise to a lively debate, but the tax on molasses led to the warmest discussion. Massachusetts stoutly and successfully resisted the proposal to tax it eight cents per gallon, and for three reasons: first, as increasing its cost to the consumer; secondly, as crippling her distillers of rum by a heavy tax on their raw material; and lastly, as injuring her fisheries by checking the importation of the article, for which she exchanged her fish. "The tax," said Ames, "operated in two ways: first, as a tax on the raw material, which increased the price of stock and narrowed the sale, and second, as a tax on an article of consumption." "Without the molasses trade is continued, the fishery cannot be carried on. They are so intimately connected that the weapon which wounds the one will stab the other." "If we do not import molasses," said Gerry, "we cannot carry on our distilleries or vend our fish." "Any impediment to the importation of molasses," said Goodhue, "will prevent the exportation of fish." A general duty of five per cent., ad valorem, was levied on goods and merchandise; wool and tin-plate, however, being among the articles excepted from any tax. These special duties on a few score articles ranged from 5 to 12 per cent. in the ad valorems, and were equally moderate when specific; as, for example, 10 cents a gallon on distilled spirits, Jamaica proof; 18 cents on Madeira wine; I cent a pound on brown sugar, 3 cents on loaf sugar, and 21⁄2 cents on

other sugars; I cent a pound on nails and spikes; 21⁄2 cents a gallon on molasses. The average duty under the act was equivalent to 8 per cent. ad valorem. A tonnage tax was laid that discriminated in favor of American vessels.

Later in the session the amendments to the Constitution proposed by the States in ratifying it were taken up. There were fifty-five in all, but in many cases they were substantially identical. As finally agreed upon and offered to the States for ratification there were twelve, of which ten were promptly adopted and constitute the first ten amendments to the Constitution and likewise its Bill of Rights. They secured among other things freedom of religion; of speech; of the press; the right of petition; freedom of the person; and what was most satisfactory to those who feared centralization in the new government, an explicit declaration that the powers, not granted to the United States by the Constitution, nor prohibited by it to the States, were reserved to the States respectively or to the people. The adoption of these amendments satisfied the anti-federalists, and little more was heard of the proposition for a second convention.

Laws were passed to organize four executive departments, and the first Cabinet, as finally selected, consisted of-Thomas Jefferson, of Virginia, Secretary of State; Alexander Hamilton, of New York, Secretary of the Treasury; Henry Knox, of Massachusetts, Secretary of War; Edmund Randolph, of Virginia, Attorney-General. In this selection regard was had to their personal fitness, to locality, and,

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perhaps, also to their divergence of opinion as to the power and scope of the federal government.

North Carolina ratified the Constitution in November, 1789, but Rhode Island still sullenly refused to enter the door of the Federal Union, and remained without until May 9, 1790, when she also ratified it by a majority of two votes; "not, however," says Schouler, "without a longer list of proposed amendments than there were ·

towns in the State."

On January 14, 1790, Hamilton sent into Congress his first report, which was devoted to the consideration of the public debt. As this report was the beginning of a series of papers from the Treasury Department from this same secretary, it may not be amiss to refer briefly to its author.

Hamilton was exactly thirty-three years of age. He was born on the island of Nevis, but some obscurity hangs over his parentage, and of his early years little is known, except that he manifested supreme ambition and a vigor and maturity of mind that were phenomenal. He came to this country in his sixteenth year, and became a student of Kings College, now Columbia College, New York city, where he early espoused the cause of independence both as a writer and a speaker. Seldom, if ever, does one find in the collected writings of a statesman papers prepared by him when but seventeen or eighteen years of age; yet we still read pamphlets this young collegian hurled at the Tories amid the wonder and applause of patriots, and marvel at the strength of his reasoning and the accuracy of his in