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8.1 The Crisis Of The 1780s a.k.a The Critcal Period 1© 2009 Pearson Education, Inc.
The Economic Crisis Economic problems like wartime inflation plagued the nation. Chart: Postwar Inflation, 1777–80: The Depreciation of Continental Currency After the war the key problem was depression. Britain dumped its surplus goods in American markets, creating a trade imbalance that drew hard currency out of the United States. Repayment of debt became both a political and economic problem. Chart: The Trade Deficit with Great Britain 2© 2009 Pearson Education, Inc.
FIGURE 8.1 Postwar Inflation, 1777–80: The Depreciation of Continental Currency The flood of Continental currency issued by Congress, and the shortage of goods resulting from the British blockade, combined to create the worst inflation Americans have ever experienced. Things of no value were said to be “not worth a Continental.” SOURCE: John McCusker, “How Much Is That in Real Money?” Proceedings of the American Antiquarian Society, N.S.102 (1992): 297–359. 3© 2009 Pearson Education, Inc.
FIGURE 8.2 The Trade Deficit with Great Britain The American trade deficit with Great Britain rose dramatically with the conclusion of the Revolution. SOURCE: Historical Statistics of the United States (Washington, DC: Government Printing Office,1976),1176. 4© 2009 Pearson Education, Inc.
State Remedies States erected high tariffs to curb imports and protect infant industries but these were easily evaded by shippers. The most controversial economic remedies were designed to relieve debt burden. Farmers called for laws to require creditors to accept goods and commodities and had laws passed requiring them to accept nearly worthless state paper currency. 5© 2009 Pearson Education, Inc.
A mocking pamphlet of 1787 pictured Daniel Shays and Job Shattuck, two leaders of Shays’ Rebellion. The artist gives them uniforms, a flag, and artillery, but the rebels were actually an unorganized group of farmers armed only with clubs and simple muskets. When the rebellion was crushed, Shattuck was wounded and jailed, and Shays, along with many others, left Massachusetts. He fled to a remote region of Vermont and then settled in New York. SOURCE: Anonymous, 18 th century, “Daniel Shay (c. 1747-1825) and Job Shattuck (1725-1825?),” 1787, relief cut 9 x 12.9 cm (3-9/16 x 5- 1/16”). Published in Bickerstaff’s Boston Almanack for 1787, third edition, Boston. National Portrait Gallery, Smithsonian Institution/Art Resource, NY. 6© 2009 Pearson Education, Inc.
Chapter Eight The New Nation, 1786–1800. Chapter Focus Questions 1. What tensions and conflicts existed between local and national authorities in the.
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