Examination of the nineteenth century inter-war years

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Written Assignment 6 HIS-113 1David Spencer

Written Assignment 6

The period between the War of 1812 and Jackson eras of nineteenth America saw

significant domestic development of the United States, both economically and politically. A

post-War of 182 boom led to the bust of the panic of 1819. Following the bust, there was a

strong resurgence of nationalism leading into the Jackson victory of 1828.

Post-War Expansion

By the time that both sides agreed to the Treaty of Ghent, the war had shown the

inadequacy of transportation and financial systems of the United States (Brinkley, 2012, p. 219).

However, the lack of a solid transportation and financial foundation did not stop a post-war

economic expansion in the United States. Instead, it seems that it left the field open to new

innovation in transportation, finance, and industry.

The costs of the war exposed the problem of not having a central bank as had been the

case since the charter of Hamiltons first Bank of the United States expired in 1811 (p. 219). The

congress chartered the second Bank of the United States in 1816 to create a monopoly on the

issuance of fiat currency that had been the domain of numerous state banks during the war that

issued fiat paper money beyond the means of the banks reserves and led to multiple bank

failures. The second Bank of the United States was a clone of the first bank with more capital

that the first (p. 219). The bank created financial stability that allowed commerce to grow.

Textile Mills prospered in New England despite the anti-competitive practices of British

merchants flooding the American market with British textiles after the war. To promote the

textile mills that were expanding in size and quantity under the Lowell system, the congress

enacted a tariff that limited competition from abroad for the domestic textile mills (p. 220).


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Steamboats and nationally funded road propelled the prospering industries. The new and

expanding means of transportation expanded the economy through providing a route to get

materials to mills, and then goods to market (p. 220).

Westward expansion and the growth of the population of the United States during this

period also contributed to the economic expansion. Westward expansion of the United States is

as old as the colonies, but the transportation innovations of the era accelerated this growth. The

growth expanded the economy as the new territories provided more raw materials to the

expanding eastern mills and factories. It also expanded the American economy by creating new

markets for the products of the East.

Panic of 1819

The economic expansion of the United States was not all due to domestic factors. High

demand for American agricultural products resulted from the collapse of agriculture on the

continent during the Napoleonic Wars. This high demand led to high prices for American

farmers. A land boom followed as settlers raced to found new and bigger farms, and speculators

raced to make money in the land trade. Easy money from the state banks of the war period and

from the National Bank fueled a bubble in western land. In 1819, new management of the

National Bank began tightening credit, calling in loans, and foreclosing mortgages (p. 226).

This led to a panic, a collapse of the land market, and a depression that lasted five years.

Resurgent Nationalism

Coming out of the panic in the early 1820s nationalism was on the rise. This rise is seen

in the decisions of the Supreme Court, and the actions of the executive branch. The Court

strengthened Congress power to regulate interstate commerce in the case of Gi bbons v. Ogden


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in 1824 (p. 228). The ruling found that the acts of commerce in regulating interstate commerce

trumped state contracts and monopolies. This established Federal primacy over any matter of

interstate commerce, an important and broad distinction. This was a highly nationalistic decision

that promoted a strong, connected, and unified economy in the United States. The court further

handed down nationalistic rulings in favor of federal power over states rights in issues of Indian

affairs and relations. The court ruled in Worcester v. Georgia that the federal government, not

the states, has the right to make agreements with native tribes.

Nationalism was not restricted to the court. After the victory over the Spanish in the

south during the War of 1812, the United States was witness to the rapid decline of the Spanish

New World Empire in the following decade as revolts and revolution swept through South and

Central America (p. 228). In 1822, President Monroe established relations with five of the new

independent nations and in 1823 proclaimed the Monroe doctrine. This doctrine stated that the

United States would challenge any European attempt at further colonization in the New World.

Monroe wanted to take advantage of the growing nationalism in the United States of the 1820s to

establish hegemony in the Americas (p. 229).

Policy Cycle

The second and third order effects of the executive branchs diplomatic and political

policy can have a substantial impact on the national economy and vice versa. The war of 1812

secured the northwest for expansion that fueled an economic boom. That boom led to the bust of

1819, which in turn returned the focus of the Monroe administration to international affairs in the

Nationalism of the 1820s.


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References

Brinkley, A. (2012). American history: A survey (14th ed.). New York, NY: McGraw-Hill.

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Examination of the nineteenth century inter-war years