WHY IS THE US CURRENTLY IN DEBT?

WASHINGTON’S PRESIDENCY

Economic Problems

DAILY GOALS

4: Explain the reason’s the nation was

in debt at the beginning of

Washington’s presidency

5: Understand Hamilton’s economic

plan

AMERICA’S DEBT 1789

American Revolution leaves the US in great debt…• Sound familiar???

Bonds – a Certificate issued by a government for

an amount of money that the governments promises

to pay back, with interest• Who owns these bond?• Would you have bought a bond?

AMERICA’S DEBT 1789

Speculators – People who invest in a risky venture

in the hope of making a large profit• What is this similar to today?• Is this fair?

CAN YOU SEE WHY THIS IS A PROBLEM?

PREPARE TO HAVE YOUR MIND BLOWN…

http://

www.usdebtclock.org/

ENTER HAMILTON

1.The US government would assume all federal and

state debts

2.The US government would create a National Bank

3.The government would impose a high tax on

imported goods

THE US GOVERNMENT WOULD ASSUME ALL STATE AND FEDERAL

DEBTS

We need to pay our debt in order to maintain integrity

Northerns liked it, Southerns didn’t. Would you have

agreed to this?

Compromise

US WOULD CREATE A NATIONAL BANK

We needed a place to keep our money!

Seems like a good idea….

Jefferson sees this as unconstitutional… WHY!?• Strict interpretation

Elastic clause :Article 1, Section 8• “Congress shall have the power to make all laws

which shall be necessary and proper for carrying into execution the foregoing powers…”

• Loose interpretation

THE GOVERNMENT WOULD IMPOSE A HIGH TAX ON IMPORTED GOODS

Tariff – A tax on imported goods

Positives• Gain money for the federal government• Protect US manufacturers from foreign

manufacturers

Negatives• Think about the economic differences between the

North and South

DAILY GOALS REVISITED

1: Explain the reason’s the nation was in debt

at the beginning of Washington’s presidency

2: Understand Hamilton’s economic plan

3: Debate how the ideas behind Hamilton’s

economic plan would be received today