Much of the second session was devoted to the discussion of the able reports of Hamilton, and their final adoption did much to build up the credit of the nation and to promote its industries. He was the author of the protective system, and at the first session gave definite shape to his theories. He recommended the funding of the war debt, the assumption of the state war debts by the national government, the providing of a system of revenue from the collection of duties on imports, and an internal excise. His advocacy of a protective tariff was plain, for he declared it to be necessary for the support of the government and _the encouragement of manufactures_ that duties be laid on goods, wares, and merchandise imported. The third session of the same Congress was held at Philadelphia, though the seat of the national government had, at the previous one, been fixed on the Potomac instead of the Susquehanna—this after a compromise with Southern members, who refused to vote for the Assumption Bill until the location of the capital in the District of Columbia had been agreed upon; by the way, this was the first exhibition of log-rolling in Congress. To complete Hamilton’s financial system, a national bank was incorporated. On this project both the members of Congress and of the cabinet were divided, but it passed, and was promptly approved by Washington. By this time it was well known that Jefferson and Hamilton held opposing views on many questions of government, and these found their way into and influenced the action of Congress, and passed naturally from thence to the people, who were thus early believed to be almost equally divided on the more essential political issues. Before the close of the session, Vermont and Kentucky were admitted to the Union. Vermont was the first state admitted in addition to the original thirteen. True, North Carolina and Rhode Island had rejected the constitution, but they reconsidered their action and came in—the former in November, 1789, and the latter in May, 1790.