Penguin History of the United States of America (35 page)

Relations with Great Britain were even more important, and equally unsatisfactory. George III received John Adams in London as the first American minister to the Court of St James, in a ceremony that both men found deeply moving; but such occasions had little or nothing to do with the making of high policy. The English Cabinet had its own ideas. First, it discovered that more had been given away at the peace than had been intended or than was, perhaps, quite necessary. If the Great Lakes country was handed over to the United States the fur-trade would go with it, to the great impoverishment of Canada. England decided not to vacate Fort Detroit just yet, nor the other six frontier posts which she was pledged, by her signature of the treaty, to give up (the excuse was that America had not fulfilled some of the other terms of the peace). So for the time being much of the North-West would remain in British hands, while £200,000 worth of furs per annum found their way to London through Montreal, not through New York. As if that were not enough, England set out systematically to crush America’s maritime rivalry. The Navigation Acts were revised by Orders in Council. With seeming generosity, all duties were lifted from North American goods coming to Britain in British or American bottoms. This was a great encouragement to American producers to look to the British market. The catch was that at the same time the Americans were strictly forbidden to trade with the British West Indies; yet it was there that the colonists, before 1775, had always found their best customers. Now British ships alone would carry the produce of New England and Pennsylvania to the Caribbean and the produce of the sugar islands to Britain. With this immense advantage, British merchants soon began to drive out their American competitors from all the Atlantic routes, for they could afford to charge lower rates. It looked
as if the British merchant marine would soon have a monopoly of Atlantic trade, and thus Great Britain would be able to dictate the economic future of the ports of her former colonies. Her statesmen looked with complacency on the bickering and feebleness of the US government; some began to speculate that before long economic pressure would force the New Englanders, at least, to see sense and come back to their true allegiance. Instead, the individual American states imposed discriminatory tariffs on British goods and passed navigation Acts to shut out British shipping; but although these measures were helpful, they could not of themselves defeat British policy. Besides, they set American merchants (who welcomed the navigation laws but disliked the protective tariffs) against American artisans (who were most interested in the tariffs). And, as in the matter of Spanish relations, there seemed to be nothing that Congress could do.

The young Republic, then, endured something like an economic cold war in the first years of peace. Bad as this was, the internal situation was if anything worse. At times it seemed that the peace, by removing the British, had removed the one force capable of inspiring an effective Union. Each state began to go her own way. Even more depressing, the end of the war was followed (as has usually been the case with America’s wars) by an economic crisis.

It will not do to exaggerate this. Benjamin Franklin, coming home for good in the autumn of 1785, was delighted with the evident prosperity of Pennsylvania, and wrote to all his friends in Europe telling them not to believe English assertions that the United States was on the brink of ruin. George Washington did the same. ‘It is wonderful to see how soon the ravages of war are repaired,’ he wrote:

Houses are rebuilt, fields enclosed, stocks of cattle which were destroyed are replaced, and many a desolated territory assumes again the cheerful appearance of cultivation. In many places the vestiges of conflagration and ruin are hardly to be traced. The arts of peace, such as clearing rivers, building bridges, and establishing conveniences for travelling &c. are assiduously promoted. In short, the foundation of a great empire is laid.

All this was no doubt true: America was and is an intrinsically rich country, and the inhabitants have never been backward in exploiting her resources. But in the wake of the Revolutionary War even this natural abundance could be an embarrassment, or at any rate of little use to the producers. The Americans were oppressed by all manner of debts, and the means of paying them seemed to be lacking. The foreign debt alone, including both capital and interest, went up from $7,885,085 in 1783 to $11,858,983 in 1789.
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Most of
this was owed to France, which did not press for her money; but domestic creditors were less forbearing. They wanted to be paid, and to be paid in good currency, that is, in gold or silver: they spurned the grossly devalued paper money issued by the states and Congress. At the same time many debtors found it impossible to earn the necessary specie, for it could only come from abroad, and Great Britain, as we have seen, had cut off American farmers from their foreign markets. Their unsellable produce piled up in their barns, and their creditors took them to court. Matters were made worse all round by the pressure of the state governments. Public credit was exhausted, and could be renewed, so that government might continue, only by a determined, successful effort to redeem the paper currency; and the only way by which such redemption might be achieved was by higher taxes. At the back of the queue came Congress, desperately pleading for enough money to pay the running expenses of the national government, if not to pay off the national debt.

In the circumstances it is not surprising that there was a revival of the bitter battles between debtors and creditors that had marked the late colonial era. Defying the peace treaty, the Virginia legislature passed laws to stop British creditors suing to collect their pre-war debts, for, as George Mason wrote to Patrick Henry, ‘If we are now to pay the debts due to the British merchants, what have we been fighting for all this while?’ In Rhode Island, the debtor party won control of the state government, and tried by law to compel creditors to accept the depreciated paper currency in settlement of debts: this led to complete economic dislocation. Things were even worse in Massachusetts. There the debtor-creditor struggle merged with the long-standing feud between the eastern part of the state, dominated by Boston, the lesser ports and mercantile interests generally, and the farming west. To pay the public debt the Boston-influenced legislature decreed taxes which the West found intolerable. For the farmers of the up-country were not in the least like those of Pennsylvania, or the planters of the South. Their land was poor; they could not produce for the market, but only for their own subsistence, as is shown by the fact that they were not very eager customers for expensive things like imported cloth. Their contribution to trade lay only in the small amounts of tea and sugar for which they bartered what they could spare of their harvest. Some had done well from the sale of provisions during the war, but others were badly hit by the dislocation of the times: here and there land went out of cultivation and began to revert to wilderness. Harvests were good in 1784, but hardship grew worse as the pressure from the state government increased. As one sympathizer pointed out,
… when a farmer brings his produce to market, he is obliged to take up with the buyer’s offer, and is forced, not infrequently, to take merchandise in exchange, which is totally insufficient to discharge his taxes. There is no family that does not want some money for some purposes, and the little which the farmer carries home from market, must be applied to other uses, besides paying off the [tax] collector’s bills. The consequence is, distraint is made upon his stock or real estate.
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The westerners had no sympathizers in the East: Sam Adams had long since lived down the indiscretions of his youth and was as hot against defaulting agitators as if he were Thomas Hutchinson himself. Business conditions were very bad for the time being: the peace had brought a rush of goods to the United States, which had quickly glutted the market. As a result many importing merchants had been ruined; trade was now at a standstill, even for the rum distilleries (according to an English traveller). It was time to put the public finances on a sound footing, so as to diminish inflation, restore confidence and thus, perhaps, initiate an economic revival. So the legislators relentlessly hounded the farmers to pay their taxes. At length it was more than the westerners could bear. In the autumn of 1786, led by a former Continental officer, Daniel Shays (1747–1825), a veteran of Lexington, Bunker Hill and Saratoga, they rose in rebellion, closing down the county courts which were sending so many of them to debtors’ prison,
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and threatening to march on Boston. But they were unarmed, except for pitchforks, the federal arsenal at Springfield was successfully defended against them, and so they were easily dispersed by the state militia. There was not going to be a second revolution in Massachusetts; and anyway the state government showed itself to be more wise and lenient than George III. The rebels were punished lightly, and some of their demands were granted: there were no Intolerable Acts. In 1787 prosperity began to return, and discontent died down.

None the less, Shays’s Rebellion was a terrible shock to respectable Americans. The nature of the uprising was largely unknown to people outside Massachusetts; all they could see was that an armed revolt against a duly constituted republican government had come dangerously close to succeeding; that property was in danger; and that nowhere in America was there sufficient force to defeat another such challenge, either internal or external (Chief McGillivray was just now beginning his successful depredations on the Georgian frontier).
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George Washington’s reaction, as so often, was entirely representative:

What a triumph for the advocates of despotism, to find that we are incapable of governing ourselves, and that systems founded on the basis of equal liberty, are merely ideal and fallacious. Would to God that wise measures may be taken in time to avert the consequences we have but too much reason to apprehend.

The important thing to understand here is what Washington meant by ‘wise measures’. He saw the problem as essentially political, not economic; and therefore the cure he looked for was also political. He decided, like many another solid citizen, that the time had come to amend the Articles of Confederation.

The remedy may seem somewhat remote from the disease. Perhaps it was, for Massachusetts was not the only place where economic conditions began to improve long before any effective political action at the national level had been taken. But a number of well-placed gentlemen had been agitating for a reform of the Articles for some years; and in a crisis men tend to adopt whatever programme is on offer, without scrutinizing its fitness too nicely. The great point is to be doing something. The economic argument for a reform was not wholly implausible: the underlying causes of American debility were British mercantilism, which only a strong national government could challenge successfully, and the collapse of the national credit, which only such a government could restore. Washington’s brilliant young protégé, Alexander Hamilton of New York (1755–1804), believed in these propositions passionately. To his mind ‘the three great objects of government,
agriculture, commerce and revenue
, can only be secured by a general government’, and he was prepared to say so, in season and out of season, and recommend a pretty strong general government into the bargain – certainly a much stronger one than that set up by the Articles. Others were less single-minded on the point than Hamilton; or they had entirely different reasons for wanting a reform. To them, Shays’s Rebellion was more an opportunity than an argument.

American government under the Articles of Confederation has no doubt been unfairly attacked, both in its own time and since. The Confederation Congress had some real triumphs to its name. It had conducted the revolutionary war feebly but successfully and secured a generous peace treaty through its chosen emissaries. In the years since 1783 it had achieved a settlement of the Western land question that was to be of incalculable importance to the American future. To get the Articles ratified it had been necessary to induce Virginia and other states with charter claims to relinquish them and concede that the vast stretch of territory between the Appalachians and the Mississippi, between the Great Lakes and the borders of Florida, should be held by Congress on behalf of all American citizens. The existence of this heritage did much to cement national loyalties and to diminish the importance of state identities. Next, in 1785, Congress had passed the Land Ordinance first drafted by Thomas Jefferson, which laid down, with all the brilliant rationality of its author, how and on what terms the national lands
should be disposed of. Jefferson was indeed the Father of the West: as President he would purchase Louisiana and send out the Lewis and Clark expedition; but the Land Ordinance was his masterpiece. If most of America is today a chessboard it is because of his plan, by which the public lands were surveyed and divided into townships (as in New England) six miles square. Each township was subdivided into thirty-six further rectangles, known as sections; and these sections were to be sold whole, at not less than a dollar an acre, to developers. Not many American farmers could pay $640 for a whole section, so the Ordinance was a boon for the speculative land companies; but even they had to subdivide their sections and sell at fairly low prices eventually, if they were to find customers and make a profit; meantime the Ordinance secured an orderly growth of the West. Finally, in 1787, when settlement of the Ohio river valley was about to begin, Congress passed the North-West Ordinance, which provided for the political organization of the new lands. Under this law three stages were envisaged for the North-West. First, it would be ruled by a governor and judges appointed by Congress. Then, when it had acquired 5,000 free male adult inhabitants, it would become a self-governing ‘territory’, a colony, as it were, with its own legislature and a non-voting delegate in Congress, but still with an appointed governor. Finally, when any part of the territory had acquired 60,000 free inhabitants it could (Congress consenting) become a state of the Union, on an equal footing with the old thirteen. To prevent the old states being totally swamped by the new, it was laid down that no more than five (and no less than three) states might be carved out of the territory. Various other provisions of the Ordinance guaranteed to the Westerners what would one day be known as the American way of life: civil rights and liberties, religious freedom, education – even, or especially, personal freedom: for it was laid down that ‘there shall be neither slavery nor involuntary servitude in the said territory’.