November 2019 Spot of Parchment

In early October, I had the opportunity to present on the creation of executive authority for a bunch of lawyers as part of a continuing legal education seminar. One of the things they asked about the most was George Washington’s business practices while he was in office. I wasn’t surprised, this question is actually one of my FAQ’s over the last couple of years, long before President Trump mentioned Washington and Mount Vernon.

I won’t get into current politics, but I thought it might be helpful to share how Washington participated in the economy while he was president and then you can draw your own parallels or comparisons.

As the first president, Washington was painfully aware that each action would set precedents for his successors and he agonized over every decision, both big and small. For example, he requested input from many of his friends and advisors about things like what social events he could attend or how he should interact with average citizens. These concerns might seem silly to us, but Washington and many others worried constantly that one misstep would cause the new nation to fail and it would be their fault. It’s easy to look back from 2019 and assume that because the nation survived, it was always destined to succeed, but that was far from reality. Every previous republic had failed and the founders were avid students of history. Furthermore, the states didn’t really have that much in common and the bonds binding them to the nation were flimsy. In fact, before the Revolution, the states had much closer connections with Britain than each other.

In 1789, when Washington took the oath of office, the flag hadn’t taken on the symbolic importance it holds today and communication between the regions was slow and unpredictable. Washington was the most famous American and the best-known symbol of the United States. Accordingly, he was very careful to try and represent all Americans. He made a conscious effort to wear American homespun for his inaugurations and endured lengthy and uncomfortable tours to each and every state. Washington also strove to represent all regions and factional interests through his nominations to high office, including his cabinet, the Supreme Court, and foreign ministers.

This approach extended to his economic and personal dealings as well. A quick disclaimer, the term “business” didn’t really exist in the 1790s. There were companies, banks, firms, and merchants. But not large businesses like we think of them today. So when I say economic dealings, I mean how he bought goods, sold the items produced by the enslaved communities on his plantations, and purchased land. As president, Washington was careful to eschew all affiliations with companies, controversial organizations, or groups that only represented one segment of citizens.

George Washington's Society of Cincinnati medal.

For example, he resigned from the presidency of the Society of the Cincinnati before attending the Constitutional Convention in 1787. The Society of Cincinnati was founded by General Henry Knox and other officers at the end of the war to preserve and share the values of the Revolution, and provide care for disabled veterans and their families. However, many citizens objected to its hereditary nature, which passed membership from military officers to their eldest son. While Washington deeply believed in the mission of the organization, he understood that the hereditary component stoked fears about a possible American aristocracy—just like the British aristocracy Americans had recently escaped.

Washington also resigned from the presidency of the Potomac Company. He had served as an early founder and investor in the Potomac Company, which sought to create a canal system that would connect western territories with eastern seaports. Washington believed that the Potomac River was the perfect waterway to transport goods, letters, and more between the east and the west—the company just needed to find a way to bypass the massive rapids. Again, he believed in the mission and had invested his own funds to support the cause. But he also worried that American citizens might question whether he was making decisions to benefit the nation or to line his own pockets if one of his decisions assisted the Potomac Company. Washington concluded that it was always better to remain above reproach whenever possible. 

Remains of the locks and the canal still exist in northern Virginia.

While he avoided any public investment or involvement, Washington did maintain ownership of his plantation and continued to rely on enslaved labor to cultivate the land. To be clear, however, maintaining private ownership of land was accepted practice for eighteenth-century politicians. All of the early presidents—Adams, Jefferson, Madison, Monroe, etc.—kept their plantations or farms while in office and continued to cultivate the land. There’s a simple explanation for this practice; there were no retirement policies or 401k options in place in the eighteenth century and politicians relied on their land to provide for themselves and their families after they left office. Since Washington’s administration, every president has maintained some sort of private property, whether it be a home for their post-presidential years or a farm.

George Washington at Mount Vernon. Credit: George Washington’s Mount Vernon.

I hope this background provides some context for Washington’s precedent. Please let me know if you have any questions, I’m happy to answer them! I’d also love to know if you find this sort of explanation or precedent-type story helpful and if you would like to receive more of them.

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