George Washington established three executive departments - State, War, and Treasury - to carry out the functions of the new federal government. The Department of State, led by Thomas Jefferson, handled foreign affairs. The Department of War, under Henry Knox, managed military and Native American relations. Alexander Hamilton's Department of the Treasury oversaw the nation's finances and established a system of bonds and taxes. Washington also faced early challenges like the Whiskey Rebellion over taxation and delivered a farewell address warning against political parties and foreign entanglements.