In the 1790s, America’s first political parties, Alexander Hamilton’s Federalists and Thomas Jefferson’s Democratic-Republicans, became involved in a clash of interests. Federalists mainly represented the interests of manufacturing and trade, which they deemed the progress’ driving force.
For Federalists, progress could only be achieved with the help of a powerful central government that could establish a stable currency and strong public credit. Not trusting the public’s latent radicalism, they nonetheless convincingly appealed to workers and artisans.
Their primary geographical sphere of influence was the New England states. Federalists viewed England as an example to be followed by the United States in many ways and tried to maintain good relations with the country. In their turn, Republicans primarily advocated for the interests of agriculture, did not trust bankers and had little concern for manufacturing and trade.
They were of the opinion that freedom and democracy could only flourish in a rural society of independent farmers. They did not believe in a powerful central government; moreover, they saw it as a potential threat to freedom. Federalists supported the rights of states and had the strongest influence in the South.
The collision between these two parties resulted in a new and extremely important rendering of the Constitution. When Hamilton expressed his desire to found a national bank, Jefferson argued that, according to the Constitution, the federal government was not authorized to establish such a bank.
Hamilton replied that a broad range of powers had to be inferred by general provisions, one of which authorized Congress to enact all necessary and appropriate laws. In his opinion, a national bank would help perform the functions which the government was already authorized to do – and such a view was accepted.
Therefore, an important precedent was set for interpreting the authority of the federal government. I am more sympathetic to Jefferson’s ideas, though both approaches make sense to me in terms of their consistency.