Edmund Randolph of the Virginia delegation proposes, on May 29, 1787, the creation of a bicameral legislature.

Under his proposal, membership in both houses would be allocated to each state proportional to its population; however, candidates for the lower house would be nominated and elected by the people of each state.

This proposal allows fairness and equality to the people.

Candidates for the upper house would be nominated by the state legislatures of each state, then elected by the members of the lower house.

This proposal is known as the Virginia Plan.

Less populous states like Delaware are afraid that such an arrangement will result in their voices and interests being drowned out by the larger states.

Many delegates also feel that the Convention does not have the authority to completely scrap the Articles of Confederation, as the Virginia Plan would have.

In response, on June 15, 1787, William Paterson of the New Jersey delegation proposes a legislature consisting of a single house.

Each state is to have equal representation in this body, regardless of population.

The New Jersey Plan, as it is called, would leave the Articles of Confederation in place, but would amend them to somewhat increase Congress's powers.

At the time of the convention, the South is growing more quickly than the North, and Southern states have the most extensive Western claims.

South Carolina, North Carolina, and Georgia are small in the 1780s, but they expect  growth, and thus favor proportional representation.

New York is one of the largest states at this time, but two of its three representatives (Alexander Hamilton being the exception) support an equal representation per state, as part of their desire to see maximum autonomy for the states. (The two representatives other than Hamilton will leave the convention before the representation issue is resolved, leaving Hamilton, and New York state, without a vote.)

James Madison and Hamilton are two of the leaders of the proportional representation group.

Madison argues that a conspiracy of large states against the small states is unrealistic as the large states are so different from each other.

Hamilton argues that the states are artificial entities made up of individuals, and accuses small state representatives of wanting power, not liberty.

For their part, the small state representatives argue that the states are, in fact, of a legally equal status, and that proportional representation would be unfair to their states.

Gunning Bedford, Jr. of Delaware notoriously threatens on behalf of the small states, "the small ones w[ould] find some foreign ally of more honor and good faith, who will take them by the hand and do them justice."

Elbridge Gerry ridicules the small states’ claim of sovereignty, saying “that we never were independent States, were not such now, & never could be even on the principles of the Confederation. The States & the advocates for them were intoxicated with the idea of their sovereignty.” ("Madison's notes, June 29 1787". Yale Avalon project.)

The problem is referred to a committee consisting of one delegate from each State to reach a compromise.

Oliver Ellsworth had joined the Constitutional Convention in Philadelphia in May 1787 as a delegate from Connecticut along with Roger Sherman and William Samuel Johnson.

More than half of the fifty-five delegates are lawyers, eight of whom, including both Ellsworth and Sherman, have previous experience as judges conversant with legal discourse. 

Ellsworth takes an active part in the proceedings beginning on June 20, when he proposes the use of the name the United States to identify the government under the authority of the Constitution.

The words "United States" had already been used in the Declaration of Independence and Articles of Confederation as well as Thomas Paine's The American Crisis.

It is Ellsworth's proposal to retain the earlier wording to sustain the emphasis on a federation rather than a single national entity.

Three weeks earlier, on May 30, 1787, Edmund Randolph of Virginia had moved to create a "national government" consisting of a supreme legislative, an executive and a judiciary.

Ellsworth accepts Randolph's notion of a threefold division, but moves to strike the phrase "national government."

From this day forward the "United States" is the official title used in the Convention to designate the government, and this usage will remain in effect ever since.

The complete name, "the United States of America," had already been featured by Paine, and its inclusion in the Constitution is the work of Gouverneur Morris when he makes the final editorial changes in the Constitution.

The committee submits its report, which becomes the basis for the “Great Compromise" of the Convention, on July 5.

The report recommends that in the upper house each State should have an equal vote and in the lower house, each State should have one representative for every forty thousand inhabitants, counting slaves as three-fifths of an inhabitant, and that money bills should originate in the lower house (not subject to amendment by the upper chamber).

After six weeks of turmoil, North Carolina switches its vote to equal representation per state and Massachusetts abstains, and a compromise is reached, being called the "Great Compromise."

In the "Great Compromise," every state is given equal representation, previously known as the New Jersey Plan, in one house of Congress, and proportional representation, known before as the Virginia Plan, in the other.

Because it is considered more responsive to majority sentiment, the House of Representatives is given the power to originate all legislation dealing with the federal budget and revenues/taxation, per the Origination Clause.

Roger Sherman and Oliver Ellsworth, both of the Connecticut delegation, have created a compromise that, in a sense, blends the Virginia (large-state) and New Jersey (small-state) proposals regarding congressional apportionment.

What is ultimately included in the constitution is a modified form of this plan, partly because the larger states disliked the original.

In committee, Benjamin Franklin had modified Sherman's proposal to make it more acceptable to the larger states.

He had added the requirement that revenue bills originate in the house.

Senate representation is explicitly protected in Article Five of the United States Constitution:

...no state, without its consent, shall be deprived of its equal suffrage in the Senate.

This agreement allows deliberations to continue, and thus leads to the Three-Fifths Compromise, which will further complicate the issue of popular representation in the House.

Article III, Section 1 of the Constitution prescribes that the "judicial power of the United States, shall be vested in one supreme Court, and such inferior Courts" as Congress sees fit to establish.

It makes no provision for the composition or procedures of any of the courts, leaving this to Congress to decide.

The federal judiciary of the United States is created by the Judiciary Act of 1789 (ch. 20, 1 Stat. 73), a federal statute adopted on September 24, 1789, in the first session of the First United States Congress.

The Act provides that a United States Marshal's primary function is to execute all lawful warrants issued to him under the authority of the United States.

The law defines marshals as officers of the courts charged with assisting federal courts in their law-enforcement functions.

The existence of a separate federal judiciary had been controversial during the debates over the ratification of the Constitution.

Anti-Federalists have denounced the judicial power as a potential instrument of national tyranny.

Indeed, of the ten amendments that eventually become the Bill of Rights, five (the fourth through the eighth) deal primarily with judicial proceedings.

Even after ratification, some opponents of a strong judiciary had urged that the federal court system be limited to a Supreme Court and perhaps local admiralty judges.

The Congress, however, has decided to establish a system of federal trial courts with broader jurisdiction, thereby creating an arm for enforcement of national laws within each state.

President George Washington signs the Act into law on September 24, 1789 and promptly submits his nominations to fill the offices created by the Act.

Among the nominees are John Jay for Chief Justice of the United States; John Rutledge, William Cushing, Robert H. Harrison, James Wilson, and John Blair Jr. as Associate Justices; Edmund Randolph for Attorney General; and myriad district judges, United States Attorneys, and United States Marshals for Connecticut, Delaware, Georgia, Kentucky, Maryland, Maine, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, South Carolina, and Virginia.

Among Washington's initial six Supreme Court nominations, all accept and are confirmed with the exception of Robert Harrison, who declines to serve.

As a result of Harrison's refusal, Washington will later nominate James Iredell, who will join the Court in 1790, thereby completing the Court at its legally prescribed "full strength" of six members for the first time, and fulfilling the requirements of the 1789 Act.

Samuel Hopkins, an inventor from Philadelphia, Pennsylvania, becomes on July 31 the first to be issued a U.S. patent (for an improved method of making potash).

The patent was signed by President George Washington, Attorney General Edmund Randolph, and Secretary of State Thomas Jefferson.

The other U.S. patents issued this year will be for a new candle-making process and Oliver Evans's flour-milling machinery.

Alexander Hamilton had begun the political and economic maneuvering in mid-March 1792 necessary to contain the credit crisis affecting markets across the country.

The charter creating the Bank of the United States had also set up the Sinking Fund Commission composed of Vice President John Adams, Secretary of State Thomas Jefferson, Attorney General Edmund Randolph, Chief Justice John Jay, and Secretary of the Treasury Alexander Hamilton, charged with resolving financial crises.

On March 21, 1792, with Jay absent from voting, the commission had split on the decision to allow open-market purchases.

Having received notice from William Seton that the Bank of New York is in trouble, Hamilton wishes to have the government make purchases as it had in 1791, but is unable to do so while Jefferson and Randolph stand opposed.

While still waiting for Jay’s formal and deciding vote, Randolph begins to side with Hamilton on March 26, and with only Jefferson dissenting, the commission authorizes one hundred thousand dollars in open-market purchases of securities.

Hamilton, in a series of letters to Seton at the Bank of New York, introduces several measures to restore normalcy to the securities market.

Hamilton encourages the bank to continue offering loans collateralized by US debt securities, but at a slightly increased rate of interest—seven percent instead of six.

In order to persuade the Bank of New York to lend during the panic, Hamilton also promises that the US Treasury will buy from the bank up to five hundred thousand dollars of securities should the Bank of New York be stuck with excessive collateral.

Similarly, Hamilton supports the Bank of Maryland’s lending by offering to have the US Treasury cover loans made to merchants paying duties.

By April 16, after Hamilton authorizes an additional one hundred and fifty thousand dollars of open-market purchases by the Bank of New York, Seton reports that market demand is returning to normal.

In just under a month, Hamilton has thus been able to stabilize the securities market and prevent the panic from inducing a recession.

By exerting his power as Secretary of Treasury and persuading a number of banks to continue offering credit throughout the crisis, Hamilton has been able to limit the amount spent by the Sinking Fund Commission to two hundred and forty-three thousand dollars—roughly one hundred thousand dollars less than what had been spent during the smaller panic in 1791.
 
Economists and economic historians will note that Hamilton's management of the Panic of 1792 appears to have anticipated "Bagehot's Dictum" by approximately eighty years.

This prescription, that in a crisis central banks should "lend freely, against good collateral, at a penalty rate" is still considered the gold standard for managing a financial panic as the "lender of last resort."

Thomas Jefferson, who had accepted Washington's invitation to serve as Secretary of State soon after returning from France, had initially expected to return to France, but Washington had insisted that he be on his new Cabinet.

There is no explicit reference to a "Cabinet" in the United States Constitution, the United States Code, or the Code of Federal Regulations.

In the Constitution, the President is authorized (but not compelled) to "require the Opinion, in writing, of the principal Officer in each of the executive Departments, upon any Subject relating to the Duties of their respective Offices."

The Constitution does not provide for an explicit forum where the principal officers' opinions can be obtained less formally, without writing, such as a formal Cabinet.

Washington organizes his principal officers into a Cabinet on February 25, 1793, and it has been part of the executive branch structure ever since.

Washington's Cabinet consists of six members: himself, the Vice President John Adams, Secretary of State Thomas Jefferson, Secretary of the Treasury Alexander Hamilton, Secretary of War Henry Knox and Attorney General Edmund Randolph.

Washington's cabinet members are known for their dissension, forming rival parties, and having sharply divided views, the most fierce between Hamilton and Jefferson.

Jefferson describes his relationship with Hamilton as being "daily pitted... like two cocks."

Knox almost always sides with Hamilton, while Randolph tries to remain neutral but tends to side more with Jefferson, his fellow Virginian.

Washington will restrict cabinet discussions to topics of his own choosing, without participating in debate.

He will occasionally request cabinet opinions in writing, and he expects his department heads to carry out his decisions without complaint.