Washington retired to Mount Vernon in March 1797 and devoted time to his plantations and other business interests, including his distillery. His plantation operations were only minimally profitable,and his lands in the west (Piedmont) were under Indian attacks and yielded little income, with the squatters there refusing to pay rent. He attempted to sell these but without success. He became an even more committed Federalist. He vocally supported the Alien and Sedition Acts and convinced Federalist John Marshall to run for Congress to weaken the Jeffersonian hold on Virginia.
Washington grew restless in retirement, prompted by tensions with France, and he wrote to Secretary of War James McHenry offering to organize President Adams' army. In a continuation of the French Revolutionary Wars, French privateers began seizing American ships in 1798, and relations deteriorated with France and led to the "Quasi-War". Without consulting Washington, Adams nominated him for a lieutenant general commission on July 4, 1798, and the position of commander-in-chief of the armies. Washington chose to accept, and he served as the commanding general from July 13, 1798, until his death 17 months later. He participated in planning for a provisional army, but he avoided involvement in details. In advising McHenry of potential officers for the army, he appeared to make a complete break with Jefferson's Democratic-Republicans: "you could as soon scrub the blackamoor white, as to change the principles of a profest Democrat; and that he will leave nothing unattempted to overturn the government of this country." Washington delegated the active leadership of the army to Hamilton, a major general. No army invaded the United States during this period, and Washington did not assume a field command.
Washington was known to be rich because of the well-known "glorified façade of wealth and grandeur" at Mount Vernon, but nearly all his wealth was in the form of land and slaves rather than ready cash. To supplement his income, he erected a distillery for substantial whiskey production. Historians estimate that the estate was worth about $1 million in 1799 dollars, equivalent to $15,967,000 in 2021. He bought land parcels to spur development around the new Federal City named in his honor, and he sold individual lots to middle-income investors rather than multiple lots to large investors, believing they would more likely commit to making improvements.