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Founded as a hereditary society for Continental Army officers and their descendants, with a vision of preserving hard-won wartime camaraderie, the Society of the Cincinnati is now the oldest and most prestigious hereditary society in the United States. In its early years, the Society of the Cincinnati became the center of American debates about the role of the military in the new nation, the possibility of an aristocratic caste developing around officer status, and the dangers of mimicking European decorations and honors for men who were citizens, not subjects. The society's participation in westward expansion and education—indeed its very survival—were made possible by institutional changes that reflected America's increasingly confident image as a nation of opportunity and one in which the civil–military relationship was a source of strength rather than social conflict.

After the Revolutionary War ended, Congress kept the Continental Army on active service, although the men were bored and restless as they surrounded British-occupied New York City. Many officers feared that Congress would fail to pay their back salary, and agitated by addresses anonymously circulated during the winter of 1782 to 1783 (most probably by Maj. Gen. Horatio Gates and his subordinate Maj. John Armstrong), some discussed a coup against Congress. In 1783 George Washington defused the angry soldiers with a moving speech that won their loyalty and patience. Much of Washington's staff, however, feared continuing plots and even the disintegration of the Army if steps were not taken to cement their bonds and lobby Congress in a respectable and organized way for their back pay.

Henry Knox, who had discussed a patriotic and fraternal order of soldiers as early as 1776, drafted the organization and membership requirements of the Society of the Cincinnati. The Institutes, as the papers were called, (the founders of the society gave their documents a formal title for publication) were proposed at Frederick von Steuben's headquarters in Fishkill, New York, on May 13, 1783. They laid the foundations for a society of Army officers, to be continued by primogeniture through their male descendents, and also outlined the ideals of well-funded charitable support for war widows and orphans. Additionally, the Institutes included provisions for technical education to ensure a pool of potential officers trained in engineering and the sciences. In a nod to George Washington, who agreed to become the president of the organization, the group chose the name Society of the Cincinnati after the 5th century BC Roman general Lucius Quinctius Cincinnatus, who, after a distinguished military career, returned to his farm rather than receive glory and rewards for his triumphs. This classical allusion was repeated in the society's motto, Omnia relinquit servare rempublicam(He gives up everything to serve his country).

Officers joined the society by pledging a month's pay at their separation rank to the general fund, and quickly organized annual meetings for state societies. The national organization planned to meet every three years and to maintain contact among the state societies thorough Committees of Correspondence. Membership in the society was expanded to include foreign officers, including the Polish Thaddeus Kosciuszko, the German baron Frederick William von Steuben, the French naval and Army officer Marquis de Lafayette, and admirals Francois de Grasse and Jean-Baptiste-Donatien de Vimeur, comte de Rochambeau. Maj. Pierre L’Enfant was commissioned to design a badge, which was produced in Paris. Washington received a special diamond-studded version as a personal gift from the French naval officers, but refused to accept the gift as a private citizen. He instead insisted it belong to the president of the society as a badge of office.

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