John Hancock

July 30, 2014

Professor Magnusson
Economic History
E-Portfolio Writing ssignment
!nite" #tates Economic History through the $ears
%he &e'olutionary War ha" its (ositi'es an" its negati'es for the !nite"
#tates economy) *ne of the greatest (ositi'es of the +ar is that it remo'e"
restrictions of +est+ar" e,(ansions) %he economic o((ortunities create" -y the
+est+ar" e,(ansion +ere en"less) %o make a fair +ay to "istri-ute the lan",
%homas Je.erson came u( +ith some or"inances that +oul" hel( "i'i"e the lan")
%hese or"inances +ere kno+n as the /an" *r"inance of 1014, the /an" *r"inance
of 1012, an" the /an" *r"inance of 1010) %he %reaty of Paris, +hich ha" en"e" the
&e'olutionary War, ma"e 3ritain gi'e the lan" of the *hio 4alley to the !nite"
#tates) Ho+e'er, the !nite" #tates ha" a (ro-lem) %hey "i" not kno+ ho+ to "i'i"e
these) #o the /an" *r"inance of 1014 calle" for the lan" north of the *hio &i'er an"
east of the Mississi((i &i'er to -e "i'i"e" se(arate section) Ho+e'er, there +as one
issue +ith this) %hey ne'er sai" ho+ to "i'i"e the sections) %he /an" *r"inance of
1012 "ealt +ith this issue) %his or"inance allo+e" for the making of the Pu-lic /an"
#ur'ey #ystem) %he sur'eyors +ere to "i'i"e the territory into in"i'i"ual to+nshi(s)
Each to+nshi( +as to -e a s5uare, 640 acre section) %hese sections +oul" -e sol"
for a minimum of 640 "ollars, an" the go'ernment +oul" kee( some sections for
schools or for (ayment to sol"iers for the +ar) %he /an" *r"inance of 1010,
other+ise kno+n as the 7orth+est *r"inance, ma"e the 7orth+est %erritory) %he
7orth+est %erritory +as south of the 8reat /akes, north an" +est of the *hio &i'er,
an" east of the Mississi((i &i'er) Peo(le coul" also -uy sections of this lan",
ho+e'er, sla'ery +as not allo+e" on these lan"s) %hese sections of lan" hel(e" the
country e,(an" signi9cantly, +hile also hel(ing agricultural economy gro+)
%here +ere still some 'ery negati'e economic im(acts that came from the
&e'olutionary +ar) *ur greatest tra"ing (artner -efore the +ar :ust ha((ene" to -e
3ritain, an" they +oul" no longer tra"e +ith us) We -egan to tra"e +ith ;hina in the
1010<s, -ut it +as still nothing like the tra"ing +e "i" +ith 3ritain) %he
unem(loyment also +ent u( in the country after the +ar 9nishe", "ue to sol"iers
coming -ack from +ar)
merican Economy +as changing from an agricultural economy to an
in"ustrial economy) #ince the early 1100<s, the !nite" #tates +as largely an
agricultural economy, "ue to the cotton in"ustry) 3y the late 1110<s, cotton ha"
-ecome the greatest e,(ort the !nite" #tates ha") *ne reason for that is Eli
Whitney<s in'ention of the cotton gin) %he cotton gin ha" increase" cotton
(ro"uction to a (ossi-le 20 (oun"s of cotton (er "ay (er machine) =n the 1140<s,
the !nite" #tates -egan to (ro"uce a((ro,imately t+o-thir"s of the +orl"<s cotton)
;otton +as largely gro+n in the south -ecause of the -etter climate an" soil
con"itions for large (lantations) Ho+e'er, the 7orth<s climate +as much -etter
suite" for an in"ustrial economy than it +as for (lantations) 3y the time the ;i'il
War -egan, most of the nation<s manufacturing came from the north) While a-out
10 (ercent of the south +as still +orking in agriculture, only 40 (ercent of the
northern +orkers +ere +orking in agriculture) Mean+hile, most (eo(le immigrating
to the !nite" #tates from Euro(e +ere li'ing in the 7orth "ue to the ur-an areas)
While the north ha" 23 million citi>ens, the south only ha" a mere ? million)
While a lot of (eo(le -elie'e that the only cause of the ;i'il War +as sla'ery,
there +ere multi(le reasons for the ;i'il War) *ne of the -iggest reasons the south
sece"e" from the !nion +as -ecause they -elie'e" that the north +oul" interfere
+ith their (ro(erty rights) %hey thought that the north +oul" re"uce their +ealth
from taking lan" from them, as +ell as taking their sla'es) %he south -elie'e" that
they +oul" recei'e hel( from Englan" an" @rance, "ue to the nee" for cotton) s the
;i'il War -egan, you can clearly see the strengths an" +eaknesses of each
economy) %he 7orth<s in"ustriali>e" economy ha" gro+n incre"i-ly to 9ght the
south, +hile the #outh<s economy -egan to "i( "ue to lack of in"ustry an" leaning
so hea'ily on sla'e la-or an" agriculture) *ne of the -iggest a"'antages the 7orth
ha" +as the railroa" system) %he 7orth ha" a lot more railroa" on its si"e, +hich
coul" mo'e anything from sol"iers to su((lies to +ea(ons) %he #outh<s economy
ha" gone "o+nhill "ue to -locka"es on southern e,(orts) 7o foreign country +oul"
e'er ha'e loane" money to the south -ecause no-o"y ha" any i"ea if the south
+oul" make it through the +ar) t the en" of the +ar, the southern economy +as
com(letely "estroye" after making so many economical mistakes an" ha'ing so
much of their (ro(erty "estroye") %he northern economy, ho+e'er, +as gro+ing
"rastically "ue to the in"ustrial age)
Mean+hile, Presi"ent -raham /incoln an" the House of &e(resentati'es
"eci"e that +hile all the "emocrats +ere in the ;onfe"eracy, they +oul" (ass some
of the -ills that ha" not -een a-le to a"'ance) *ne of these -ills is calle" the /an"-
8rant ;olleges ct, +hich -asically grants each state lan" for agricultural an"
mechanical colleges) lso 'ote" in to la+ +as the /egal %en"er ct, +hich allo+e"
the use of 8reen-acks to (ay for all of the costs of the +ar) =t also allo+e" us not to
rely on gol" or sil'er to make 9nancial transactions)
3efore merica "eclare" +ar on 8ermany an" :um(e" into Worl" War =,
there +as an economic -oom) %he economy +as -ooming "ue to all the
countries in'ol'e" in Worl" War = -uying goo"s from the !nite" #tates) #ome
of these goo"s inclu"e" coal, iron, steel, oil, an" a lot of other (ro"ucts) %his
+as all (ossi-le -ecause of the massi'e (o(ulation increase of lo+er class
la-orers) 3ecause of the countries -uying all of these goo"s, +e ha" to hire
more +orkers +hich ma"e the unem(loyment "ro( to -et+een one an" t+o
(ercent)
*nce the !nite" #tates "eclare" +ar an" :oine" Worl" War = in (ril of
1?10, the go'ernment a"o(te" a ne+ act kno+n as the #electi'e #er'ice ct
in May of 1?10) %he #electi'e #er'ice ct re5uires the registration of all
males -et+een the ages of 21 an" 30) 3efore this act +as (ut into (lace, the
num-er of troo(s in the military +as 5uite lo+) 3et+een 1?14 an" 1?16,
there +ere a((ro,imately 102,000 troo(s) =n 1?10, there +ere 644,000
troo(s an" in 1?11, once the act came in to e.ect, it :um(e" to a staggering
3 million) %he military cannot :ust fun" itself thoughA it also nee"s a
su((orti'e economy) While the nation +as not in'ol'e" in the +ar, the
economy +as gro+ing "ue to other countries -uying goo"s from us) When
the country +ent into +ar, +e not only ha" to increase ta,es to (ay for the
+ar, -ut +omen also ha" to take their (lace in the la-or force) %he country
has to (ro"uce goo"s at a higher rate -ecause the go'ernment has to (ay,
fee", e5ui(, an" trans(ort these sol"iers +hile also maintaining a goo"
en'ironment for those -ack at the states) s ta-le 22)1 sho+s in our -ooks,
+hen the country is at +ar there is much more money that has to go to+ar"s
the military then there normally is)
3i-liogra(hy
B*hio History ;entral)B Ohio History Central) *hio History ;onnection, n)") We-) 30
July 2014)
;ain, /ouis P), an" Jonathan Hughes) American Economic History) 1th e") 7)()C
Prentice Hall, n)") CourseSmart) 2011) We-) 20 July 2014)
B%he Economic ;risis of the 1010s)B !shistory)org) =n"e(en"ence Hall ssociation,
n)") We-) 30 July 2014)
;ain, /ouis P), an" Jonathan Hughes) merican Economic History) 1th e") 7)()C
Prentice Hall, n)") ;ourse#mart) 2011) We-) 20 July 2014)
rrington, 3en:amin %) B#tory D!)#) 7ational Park #er'iceE)B 7ational Parks #er'ice)
!)#) Fe(artment of the =nterior, 14 July 2014) We-) 21 July 2014)
;ain, /ouis P), an" Jonathan Hughes) American Economic History) 1th e") 7)()C
Prentice Hall, n)") CourseSmart) 2011) We-) 20 July 2014)
#tockman, Fa'i") BHo+ the rti9cial 3oom of 1?14-1?2? ;ause" the 8reat
Fe(ression)B The Mises Economics Blog The Circle Bastiat) %he Mises =nstitute, 11
Mar) 2014) We-) 21 July 2014)