Two U.S. Parties:
The Birth of the Democratic Party

Apr 15, 2018

Part Two of a Three Part Series

This is the second part of a series about the development of political parties in the U.S. The first part appeared in the previous issue of the Class Struggle, #95, February-April 2018. The next part, to appear in the July issue of the Class Struggle, follows the birth and growth of the Republican party. The final part, to appear in the October issue, looks at how both parties came to represent the same capitalist ruling class.

When the Congress of the United States met on March 4, 1789 for its very first session, not only was the ink barely dry on the Constitution that had instituted the new Congress, the Constitution itself had not yet been ratified by two of the original 13 states.

This is not just a small historical oddity, an insignificant formality that had been overlooked in the heat of the moment. It was of a piece with the whole process that rushed to establish a new governmental framework for the American continent, in the face of growing popular opposition. In the year just before the Constitutional Convention was called, farmers’ revolts marked western New York, parts of Massachusetts and much of Rhode Island. Driven into debt by the Revolutionary War and the taxes levied on them before by Britain, farmers in many places were refusing to pay the taxes that the new state legislatures had imposed to pay off state debt. The farmers saw themselves at the mercy of moneyed interests, with the states burdening them with the same taxes that had provoked popular anger at the British crown.

Disturbed by the inability of the states to respond to the revolts, and the weakness of the central power, the wealthy classes called for revisions to the Articles of Confederation, the compact which then governed relations among the 13 former colonies of England. The sticking point was that any revision required the unanimous approval of all 13.

On February 21, 1787, the Continental Congress called on the 13 states to send delegates to a convention in Philadelphia to revise the Articles. Rhode Island, where indebted farmers had taken over the reins of the state legislature, sent no delegates. The other 12 state legislatures selected seventy delegates. Fifty-five showed up in Philadelphia on May 25, 1787. Over the next four months, bitter arguments led to the departure of some dozen more delegates. The ones who stayed took it upon themselves to junk the old Articles of Confederation and replace it with a completely new Constitution. Thirty-eight delegates from twelve states signed it on September 17. The Convention rushed it back to the Continental Congress, which, eight days later, rushed it out to the states, which were charged with submitting it to a “vote of the people.”

For the Convention that drew up the Constitution, “vote of the people” meant, in reality, an indirect vote for delegates to state conventions that would examine the Constitution and decide the question. Rhode Island was the only state of the 13 where the “people” had a chance to express themselves directly. The vote there gave some indication of the widespread opposition among the “people” when they got the chance to express themselves: 2,708 voted to reject the Constitution, against only 237 who voted to ratify.

Upset by the taxes imposed by state legislatures, indebted farmers were discovering that this new Constitution proposed to give the federal government the right to “lay and collect [still more] Taxes, Duties, Imposts and Excises.” Furthermore, the Constitution required the new government to assume responsibility for all the debts engaged before by the Continental Congress, the payments of which were already benefiting wealthy layers of the population and leading to the imposition of taxes on necessary items of consumption, hitting the poor layers of the population.

Those who wanted to reject the Constitution found it impossible to really register their opposition because of the speed with which the Constitution was drummed through and the large distances in rural areas. Remember the conditions of the time. Of course, there were no rapid modern sources of news—even the telegraph did not yet exist. News traveled slowly; documents, which went by a kind of pony express, went even more slowly. News of the proceedings of the Convention, as well as the actual Constitution itself, was unknown in many rural areas where the large majority of the population lived.

The first five states to declare themselves—Delaware, Pennsylvania, New Jersey, Georgia and Connecticut—rushed through the process in record haste. In less than three months’ time, these state legislatures gathered themselves in session, then voted to call for the election of delegates; special elections were organized locally to choose the delegates; and the delegates assembled, were presented with the Constitution and voted to ratify. When the wealthy classes want something, government moves quickly! In Pennsylvania, the process was rushed through so rapidly that the state convention had started to vote to ratify before the authorization to hold the convention had even arrived from the state legislature.

Four states—important big states—at first listed more delegates against ratification than for it: New Hampshire, Massachusetts, Virginia, and New York. Those states, along with North Carolina and Rhode Island, the two that rejected the Constitution, included about 60% of the free population of the whole country (1,900,000 of 3,200,000).

North Carolina and Rhode Island did not change their refusal for almost two years, not until they were threatened with dismemberment of their territory and financial ruin if they stayed out of the new union. The second vote in Rhode Island was taken in a convention, where the “popular passions” that James Madison had warned about could be stifled.

The judicial opinion formulated by Chief Justice John Marshall in 1819 has become the standard explanation of what transpired in the period of the Constitutional Convention. According to Marshall, this new government and the Constitution on which it rested were: “a government of the people. In form and in substance, it emanates from them. Its powers are granted by them, and are to be exercised directly on them, and for their benefit.”

In fact, the Constitution did little more than adapt the English form of government to the new world, exchanging the king for a president, the House of Lords for the Senate, the House of Commons for the House of Representatives, and so on. It was a form of government that traced back to medieval practices of a society based on hereditary privileges, and it was rapidly enacted by the moneyed interests on the American side of the ocean, for their own benefit.

The Constitution—which starts with the famous phrase, “We the People”—was adopted before “we the people” had a chance even to examine it.

“Federalism”—Establishing the Financial System

The Administration of George Washington, the first president, was dominated by members of the Constitutional Convention, starting with Alexander Hamilton, his Secretary of the Treasury. The so-called “forefathers of the nation” rapidly set to work to exercise the powers they had granted themselves, not to carry out measures benefiting “the people,” but to act for the benefit of their own class.

In the second year of Washington’s Administration, Hamilton proposed sweeping financial measures, measures that occasioned bitter debate, but which easily sailed through the new Congress. The federal government would take responsibility for the whole debt—meaning principal and interest—run up by the Continental Congress during and after the Revolutionary War against Britain. This much was asserted in the Constitution. What Hamilton added, first of all, was that the federal government would also assume responsibility for the debts of all the states that had not yet paid them. (This created opposition in the states of Pennsylvania, Maryland, Virginia and North Carolina, which had retired their debts.)

Much of the debt was owed to foreign holders of securities—essentially France, Spain and Amsterdam. But a kind of government security had originally been issued during the Revolutionary War to members of the militias. Hamilton would propose to repay all of the debts at face value. It was an enormous gift to the holders of the debt because the securities and bonds had depreciated enormously in trading in the open market. Members of the government, their allies and their families rushed to buy up securities before Hamilton’s project was known publicly. Former soldiers who had managed to keep hold of them were paid no more than 15 or 20 per cent of what they were owed by the speculators who sought them out. Call it for what it was: a bonanza for the wealthy, at the expense of the poor.

Opposition in rural areas to the new government hardened.

The total debt that the new government committed itself to pay amounted to about 85 million dollars. To pay some of it, Hamilton proposed taxes on coffee and tea—the very symbol of hated British taxation before the revolution—as well as on wine and alcohol, including the home brew that farmers made, essentially for their own consumption or for local trading.

Citing the need to pay off the debt, Hamilton also proposed to sell off vast tracts of public land from within and beyond the territories of the 13 states—accepting not only gold or silver currency, but also government bonds as a means of payment. This was a way for the government to raise funds, but also to absorb part of the debt. And it led to the creation not only of great landed estates for many of the wealthy, but also of uninhabited land in the hands of speculators, including George Washington himself.

Hamilton also proposed for the new federal state to establish a central bank, the deposits of which would come mostly from the holders of capital, 1/4 in the form of money, the remaining 3/4 in already issued government debt. These deposits were to be the backing for a new paper currency, which the bank would issue, with the first quantity of currency amounting to ten million dollars more than the amounts on deposit. In other words, it’s not only the Federal Reserve of today that transforms bad debt into new money. They were doing it in George Washington’s time!

Late in the second session of the first Congress, Hamilton proposed to establish customs duties, that is, tariffs. This served not only to raise money for the federal treasury, but also to protect fledgling American manufacturing industries from competition with Europe, and especially England. Tariffs raised the prices on imported goods, and this allowed domestic manufacturers to raise their own prices. It also might allow the new American industries to expand their own market, and thus expand production, meaning they would be in need of capital—the very thing which had increased in private hands as the result of debt repayment. All around, it was a win-win situation.

Except not everyone won. Increasing prices on both foreign and domestic manufactured goods created a problem for the parts of the population that had to buy those goods, particularly if they had to sell agricultural products to do it. Agricultural prices in this period were dropping, already making it more difficult for those who lived off agriculture, which was 90% of the population in that period.

These proposals, with only minor changes, sped through the first Congress, which sat from 1789 to 1791.

The immediate beneficiaries of Hamilton’s measures were those who held public securities themselves—and this included the majority of those who had been at the Constitutional Convention, as well as the majority of those who held a position in either House or Senate. But the real point of what was done in these first two years was not simply or even essentially personal aggrandizement, but benefit to the whole class—the fledgling capitalist class consisting of big merchants, local bankers, commodity traders, sailing companies and the first manufacturers.

Historians often talk about the men of Washington’s Administration as though they made up a political party, the Federalists, opposed by another party, the anti-Federalists. And it’s true that Washington and Hamilton and other members of the Constitutional Convention who occupied the new Congress and Administration had a coherent, clear view of what they wanted to accomplish. But they were not the political representatives of a ruling class, they were members themselves of that class.

Washington’s Administration was laying the groundwork for the development of an economy based on profit, rooted on the American continent.

At the very beginning, particularly in the years of the Constitutional Convention and the effort to ratify the Constitution, the Northern merchants et al were joined by some of the largest plantation owners, whose slaves were producing tobacco and rice for the market. Just like the new manufacturers, they were seeking to turn a profit in the marketplace. And those slaveholders were aware of the need for a strong central force available to put down uprisings, perhaps of the small farmers, but more important, of their own slaves. George Washington, himself a slaveholder and plantation owner, was twice elected unanimously by the electoral college: 1788 and 1792. The unanimous vote for Washington was symbolic of the commonality of interests between New England’s merchant class and the South’s slave owners.

Rural Opposition to Taxes and Tariffs

Hamilton’s fiscal policies and measures threatened catastrophe for large parts of the rural population. And it didn’t take long for Hamilton’s fiscal measures, especially the taxes, to provoke popular opposition to the new federal government, some of which had already expressed itself as opposition to the Constitution. In western Pennsylvania, farmers marched on Pittsburgh to prevent authorities from collecting Hamilton’s new whiskey tax. Corn was one of the main crops in the region. In those outlying areas cut off from the cities, the only way to sell the corn not wanted locally was to turn it into whiskey—there were no rapid means of transport, nor of conservation. A tax on whiskey was essentially an attack on the farmers’ ability to survive. Contingents of farmers circulated through western Pennsylvania, amassing eventually about 7,000 men under arms. It took a 15,000-strong force drawn from other state militias and led by President Washington to suppress their revolt in 1794.

The farmers may have been pushed back by military force, but this only added to anger in the rural areas.

At the same time, the glue that had bound the Southern plantation owners to the Northern merchants was crumbling. The fiscal measures that put the small farmers at a disadvantage also disadvantaged the plantation owners. Tariffs on manufactured goods raised their costs. Furthermore, the biggest markets for Southern cotton, tobacco and rice were not in the North, still less in the rest of the South, but in England. Hamilton’s tariffs threatened to shut the door to England’s market.

The men serving in Congress or in Washington’s Administration began to split into opposing factions. At first, their opposition was not declared openly, but rather by means of personal groupings, private letters and maneuvering within the Congress. By 1791, Thomas Jefferson and James Madison had organized a loose caucus within the Congress, declaring themselves the defender of the “republican” values of 1776 and proclaiming the moral superiority of “agrarian” production.

Supreme Court Justice Marshall, however, described the fracturing of the planter-merchant coalition not in moral, but in economic terms: “The first regular and systematic opposition to the principles on which the affairs of the union were administered originated in the [fiscal] measures founded on Hamilton’s Reports.” Referring to Hamilton’s proposal for a central bank, he added: “This measure made a deep impression on many members of the legislature ... and contributed, not inconsiderably, to the complete organization of those distinct and visible parties, which, in their long and dubious conflict for power, have since shaken the United States to their centre.”

The Republican-Democratic Party—Based on the Farmers, Led by the Slaveholders

In 1796, Jefferson was one of the candidates for president. It was the third election since the formation of the new government, and the last election in which the campaign was carried out almost entirely within narrow political milieus. Most of the state legislatures directly or effectively chose the people who made up the electoral college. And the vote in the electoral college was still carried out for individuals, and not parties. Jefferson, running for president, came in second in 1796, which, according to the Constitution as it was then interpreted, entitled him to the post of vice-president.

With Jefferson serving as an unofficial center, some of the biggest slave owners put themselves forward as the representatives of the whole rural population. Jefferson in a letter from 1797, which was later popularly circulated, spoke of the need for a government composed of “farmers whose interests are entirely agricultural. Such men are the true representatives of the great American interest, and are alone to be relied on for expressing the proper American sentiments.” You might have thought that Jefferson himself went out in the fields alongside his slaves to turn over the soil, sow the crops, pick the cotton, etc.

More important than this kind of moral discourse, was the rapid establishment of newspapers throughout the country, funded by the plantation owners, and large farmers, especially in the middle Atlantic states, but also in western Pennsylvania and western New York state. They attacked the new bank, private bankers, financial speculators, traders and, of course, the taxes. They accused Hamilton, Adams and others of seeking to become a new “aristocracy of wealth.” They attacked the influence of British commercial interests on American merchants, and looked to France, in the midst of its “republican” revolution, as they put it. Those newspapers focused their propaganda toward the agricultural areas, but also toward the small shopkeepers in the cities, and even to some extent, the “mechanics,” that is, the skilled workers, who often aimed to set up their own shop.

Then came a new federal tax, a direct tax on property, imposed July 1798—it became the focal point for the gathering resistance to taxes around the country. Anyone in rural areas owning land, a house or slaves was taxed on the value of his holdings. Lumped together with the slaveholders by the tax, the small farmers began to organize “land-owning committees.” In the cities “democratic committees” were set up, often by people who looked to France, which was then engaged in its revolution. “Republican” newspapers bloomed everywhere.

In 1798, the federal government enacted the “Alien and Sedition” laws. Three of those laws were aimed against immigrants from other countries—particularly France, which having gone through a revolution, now saw it receding. Many of its most radical participants were coming to the Americas. The other target was immigration from Ireland, which was in the midst of the 1798 uprising against British rule. The Adams Administration (1796-1800) was openly fearful that people from either of those countries might be the source of a revolutionary contagion on this side of the Atlantic.

The last of the laws, the Sedition Act, was specifically directed against newspapers or orators who expressed opinions opposing the federal government, its officials, the administration, or their actions. Newspapers were suppressed, their editors put on trial, then put in jail, and their printing presses broken up. The suppression of newspapers provoked the formation of more “democratic committees” in the cities. There was open outrage: Congress had torn up “freedom of the press,” and “freedom of speech,” both rights enumerated in the Bill of Rights, which had been ratified only seven years before.

The “democratic committees” were quickly pulled into the election campaign of 1800, backing the candidacy of Thomas Jefferson.

It was the first time that a political party in the modern sense, based on local organizations, looking for support from somewhat wider parts of the population, appeared on the ballot. That party went under various names, even in the same election, in the same state. Its ticket handed out for people to use to vote was variously called the Republicans, the Democratic-Republicans, the Republican Caucus, the Republican Interest. Whatever its name, and whether it was a party, a caucus or an interest, this development was the predecessor of what would become, officially, the Democratic Party a few years later.

In some states, the tickets handed out had inscribed on them the names of the electors who would go to the electoral college, pledged to vote for Jefferson. In other states, the electors were still chosen by the state legislature, so propaganda was carried out for a vote for candidates to the state legislature who were pledged to vote for electors pledged to Jefferson. It was a small beginning of a popular campaign for the presidency.

The Ascendancy of the Slaveholders

With the victory of Thomas Jefferson, the slave-holding class began its domination of the American government, which was to last for 64 years. For most of this period, this new party had little effective opposition from other parties.

From 1800 until 1850, every president but one owned slaves, and most were large slaveholders. Jefferson and Madison may have decried slavery as a scourge on the nation, but like all the others, they carried out policies that protected the interests of the Southern plantation owners. In other words, they reinforced the hold of slavery not only on the South, but on the country.

The main policies in the period of Democratic Party rule aimed at opening up, stealing, buying or otherwise attaining more land for agricultural production. But for Jefferson and the slaveholders, agriculture meant slave-based production. The major crops of the South—tobacco and cotton, as they were intensively farmed—wore out the land rapidly, requiring ever more “virgin” land to be put into production.

During this short period of time, the U.S. carried out three wars—against Britain, Spain and Mexico. It began to swallow up half the lands of Mexico. It carried out a series of wars against five Indian tribes, whose societies were long established ones, based on their own settled agricultural production. Those tribes were driven out of Georgia, Alabama, Tennessee, Florida and Mississippi, so their territory—33 million acres—could be freed up for slave-based agriculture. Florida was annexed. Texas annexed. California was annexed. New Mexico was annexed. More wars were carried out against the Indian tribes west of the Missouri. Fifteen new states were admitted to the union during this period—in ways that guaranteed the slaveholders, even as their share of the economy and of the population shrank—would maintain control over political power. The slaveholders, through the Democratic Party, would continue to control the presidency, given the way the electoral college chose the president.

These Democratic-Republicans, who had railed against debt, put the U.S. deeper in debt to carry out the wars. They went deeper in debt to purchase land. The Louisiana Purchase more than doubled the total territory under U.S. control. Slave states, including Louisiana, began to be carved out of it.

Cotton production—that is, slave-based production—moved westward. By 1834, almost twice as much cotton was being produced in the new states west of the Alleghenies, as in the old states along the southeastern seaboard. Slavery was extending.

The external slave trade was banned in 1807, according to a compromise inscribed in the Constitution. But it didn’t stop slavery—it simply opened up the domestic trade in slaves, based on the breeding of human beings for sale. The period from 1808 right up to 1863 was the period of the most openly horrifying laws ever passed in this country.

Jackson: The Presidency of the “Common Man”

With the ascendancy of Andrew Jackson, elected president in 1828, the Democratic-Republicans turned toward the Northern cities. Having shed their various other names, fastening finally on the “Democratic” label, they began to rail against the northern capitalists. And they developed political machines in some of the big cities. They proposed “democratic reforms”—specifically those that enlarged the popular electorate. Not in the South, of course. Their labor force, composed of slaves, had no legal rights at all, and the Democrats didn’t propose to change that at all. But in the North, the Democrats sought to expand the electorate to gain popular support there. (This was particularly important, since the small farmers, earlier lined up behind the slaveholders, were beginning to see that the territorial expansion did not serve their needs. And what they called for—the opening of the Mississippi so they could get their crops to markets—was blocked in Congress by the Democrats.)

Jackson assumed the presidency in the period when workers in northern cities had been engaging in important battles. They were carrying out strikes for economic demands, including against child labor and for the shortening of the hours of work. And working class newspapers spread widely. The number of workers in unions rapidly increased, despite the fact that unions were illegal, and those who spoke for them were subject to imprisonment. There was a spreading strike movement in industrial areas of Pennsylvania, New Hampshire and Massachusetts and in the railroads and on the canals. There was a renters’ movement in New York state.

Jackson toured the country speaking, presenting himself, with his backwoods Tennessee accent, as the candidate of the “humble members of society—the farmer, mechanics and laborers.” In fact, Jackson was one of the biggest plantation owners of his time. He was a slave trader, a land speculator, and the harshest exterminator of Native Americans the country had ever seen. As a general, he was widely known for carrying out summary executions of troops who refused an order. He was turning the popularly organized militias into a disciplined, professional army. This is what lurked behind the man who has ever since been called “the president of the common man.”

The Democratic Party had been gaining support in New York City, where it had developed the first real political “machine,” Tammany Hall. Democrats passed a kind of early labor legislation there and in a few other Northern states: a rough ten-hour limit on the work day, factory inspections, a mechanic’s lien law allowing a worker not paid for work to sue for his wages in the courts. Of course, like later labor legislation, there were big loopholes, but these few legislative “victories” became symbols the Democratic Party used over and over again to ingratiate itself with the growing working class movement.

Responding to abolitionist agitation against slavery, John Randolph, a Democratic congressman from Virginia, put the goal of these measures bluntly: “Northern gentlemen think to govern us by our black slaves, but let me tell them, we intend to govern them by their white slaves.”

This was the period when workers’ parties and workers’ and farmers’ parties were being organized in different states. In 1829, a Workingman’s Party appeared on the ballot in New York City. In its first run, it gained more than half the votes rolled up by the already established Democratic Party. The working class was beginning to demonstrate its political muscle.

The party of the slaveholders made every effort to enroll these new political formations inside the Democratic Party. Its attacks on the Northern capitalists struck a chord with workers who were battling against them. The “labor reform” legislation gave the Democratic Party credit with this new working class, which had little political experience. Agitation for separate working class parties died down.

The first push of the working class to organize itself politically as a class was hijacked by mortal enemies of all labor, slave or free.

It was also the first time that an exploiting American class obscured its own dominance behind a “populist” appeal to the laboring population. It would not be the last.