Although hailed by Americans as the nation’s greatest leader, Washington did not escape criticism during his two terms as president. From time to time, harsh attacks on his policies and on his personality appeared in newspapers. One paper even called Washington “the scourge and the misfortune of his country.”

Most attacks on Washington had come from supporters of Thomas Jefferson. They were trying to discredit the policies of Washington and Hamilton by attacking the president. By 1796, Americans were beginning to divide into opposing groups and to form political parties. At that time, many Americans considered political parties harmful. Parties, or “factions” as they were called, were to be avoided as much as strong central government. The nation’s founders did not even mention political parties in the Constitution.

Washington had denounced political parties and warned that they would divide the nation. To others, it seemed natural that people would disagree about issues and that those who held similar views would band together. In Washington’s cabinet Hamilton and Jefferson often took opposing sides on issues. They disagreed on economic policy and foreign relations, on the power of the federal government, and on interpretations of the Constitution. Even Washington had been partisan, favoring one side of an issue. Although he believed he stood above politics, Washington usually supported Hamilton’s positions.

In Congress and the nation at large, similar differences existed. By the mid-1790s, two distinct political parties had taken shape. The name Federalist had first described someone who supported ratification of the Constitution. By the 1790s, the word was applied to the group of people who supported the policies of the Washington administration. Generally, Federalists stood for a strong federal government. They admired Britain because of its stability and distrusted France because of the violent changes following the French Revolution. Federalist policies tended to favor banking and shipping interests. Federalists received the strongest support in the Northeast, especially in New England, and from wealthy plantation owners in the South.

Efforts to turn public opinion against Federalist policies began seriously in late 1791 when Philip Freneau began publishing the National Gazette. Jefferson, then secretary of state, helped the newspaper get started. Later he and Madison organized people who disagreed with Hamilton. They called their party the Republicans, or the Democratic-Republicans. The Republicans wanted to limit government’s power. They feared that a strong federal government would endanger people’s liberties. They supported the French and condemned what they regarded as the Washington administration’s pro-British policies. Republican policies appealed to small farmers and urban workers, especially in the Middle Atlantic states and the South.

One difference between Federalists and Republicans concerned the basis of government power. In Hamilton’s view the federal government had implied powers, powers that were not expressly forbidden in the Constitution. Hamilton used the idea of implied powers to justify a national bank. He argued that the Constitution gave Congress the power to issue money and regulate trade, and a national bank would clearly help the government carry out these responsibilities. Therefore, creating a bank was within the constitutional power of Congress. Jefferson and Madison disagreed with Hamilton. They believed in a strict interpretation of the Constitution. They accepted the idea of implied powers, but in a much more limited sense than Hamilton did: Implied powers are those powers that are “absolutely necessary” to carry out the expressed powers.

The differences between the parties, however, went even deeper. Federalists and Republicans had sharply opposing views on the role ordinary people should play in government. Federalists supported representative government, in which elected officials ruled in the people’s name. They did not believe that it was wise to let the public become too involved in politics. Public office, Federalists thought, should be held by honest and educated men of property who would protect everyone’s rights. Ordinary people were too likely to be swayed by agitators. In contrast, the Republicans feared a strong central government controlled by a few people. They believed that liberty would be safe only if ordinary people participated in government.

Washington tried to get his two advisers to work out their differences with little success. By 1793, Jefferson was so unhappy that he resigned as secretary of state. In 1795, Alexander Hamilton resigned, too, as secretary of the treasury. The rival groups and their points of view moved further apart. In the presidential election of 1796, candidates sought office for the first time as members of a party. To prepare for the election, the Federalists and the Republicans held meetings called caucuses. At the caucuses, members of Congress and other leaders chose their party’s candidates for office. The Federalists nominated Vice President John Adams as their candidate for president and Charles Pinckney for vice president.

The Republicans put forth former secretary of state Jefferson for president and Aaron Burr for vice president. Adams and Jefferson, who had been good friends, became rivals. The Federalists expected to carry New England. The Republicans’ strength lay in the South, which would give most of its votes to Jefferson. In the end, Adams received 71 electoral votes, winning the election. Jefferson finished second with 68 votes. Under the provisions of the Constitution at that time, the person with the second-highest number of electoral votes became vice president. Jefferson, therefore, became the new vice president. The administration that took office on March 4, 1797, had a Federalist president and a Republican vice president.

John Adams had spent most of his life in public service. One of Massachusetts’ most active patriots, he later became ambassador to France and to Great Britain. He helped to negotiate the Treaty of Paris that ended the Revolution. Under Washington, he served two terms as vice president. When Adams took office, he inherited the dispute with France. The French regarded Jay’s Treaty, signed in 1794, as an American attempt to help the British in their war with France. To punish the United States, the French seized American ships that carried cargo to Britain. Adams wanted to avoid war with France.

In the fall of 1797, he sent a delegation to Paris to try to resolve the dispute. French foreign minister Charles de Talleyrand, however, refused to meet with the Americans. Instead, Talleyrand sent three agents who demanded a bribe and a loan for France from the Americans. “Not a sixpence,” the Americans replied and sent a report of the incident to the United States. Adams was furious. Referring to the three French agents as X, Y, and Z, the president urged Congress to prepare for war. The incident became known as the XYZ affair.

Congress responded with a program to strengthen the armed forces. It established the Navy Department in April 1798 and set aside money for building warships. Congress also increased the size of the army. Washington was appointed commanding general. Between 1798 and 1800, United States and French naval vessels clashed on several occasions, although war was not formally declared. Adams’s representatives negotiated an agreement with France in September 1800 that ensured peace. In the view of most Americans, France had become an enemy. The Republican Party, friendly toward France in the past, hesitated to turn around and condemn France. As a result, in the 1798 elections, Americans voted some Republicans out of office.

The threat of war with France made Americans more suspicious of aliens, immigrants living in the country who were not citizens. Many Europeans who came to the United States in the 1790s supported the ideals of the French Revolution. Some Americans questioned whether these aliens would remain loyal if the United States went to war with France. Federalists in Congress responded with strict laws to protect the nation’s security. In 1798, they passed a group of measures known as the Alien and Sedition Acts. Sedition refers to activities aimed at weakening established government.

For some Americans, fears of a strong central government abusing its power seemed to be coming true. The Republicans looked to the states to preserve the people’s liberties and stand up to what they regarded as Federalist tyranny. Madison and Jefferson drafted documents of protest that were passed by the Virginia and Kentucky legislatures. The Virginia and Kentucky Resolutions of 1798 and 1799 claimed that the Alien and Sedition Acts could not be put into action because they violated the Constitution. The Kentucky Resolutions further suggested that states might nullify, or legally overturn, federal laws considered unconstitutional.

The resolutions affirmed the principle of states’ rights, limiting the federal government to those powers clearly assigned to it by the Constitution and reserving to the states all other powers not expressly forbidden to them. The issue of states’ rights would arise again and again in the nation’s early history. As the election of 1800 approached, the Federalists found themselves under attack. They urged Adams to step up the war with France. They hoped to benefit politically from the patriotic feelings that war would unleash. Adams refused to rush to war, especially for his own political gain. Instead he appointed a new commission to seek peace with France. In 1800, the French agreed to a treaty and stopped attacks on American ships. Although the agreement with France was in the best interest of the United States, it hurt Adams’s chance for re-election. Rather than applauding the agreement, Hamilton and his supporters now opposed their own president. With the Federalists split, the Republican prospects for capturing the presidency improved. The way was prepared for Thomas Jefferson in the election of 1800.