Marc Liebman's Blog, page 33

June 21, 2020

The Jay Treaty and Our First Use of Arbitration in an International Dispute

Once the Treaties of Peace (of which the Treaty of Paris that ended the American Revolution is one) were signed in 1783, there was no need for an alliance between France and the fledgling United States. Within the new country, there was a desire to resume trade with its largest trading partner, the U.K.


Once negotiations began between the U.S. and the U.K. to end the war, the British offered very generous terms if the U.S. would sign a separate treaty. France was England’s traditional enemy since 1066 and its government wanted to drive a wedge between the U.S. and France. When John Jay, the first Chief Justice of the Supreme Court of the United States was sent by Washington to London in 1793, the French Revolution had been underway since 1789 and the major European powers were at war.


April 20th,1792 – France declares war on Austria. June 13th, 1792 – Prussia declares war on France. September 21st, 1792 – the French Republic is announced. January 21st, 1793. Louis XVI is executed. February 1st, 1793 – France declares war on Britain and the Netherlands.


Both the British and American governments knew the Treaty of Paris needed clarification and both countries were reneging on key clauses. We wanted the British leave its forts in Michigan, New York, Ohio, and Vermont, normalization of trade, compensation for the 300 odd ships that the British seized in 1793 and 1794. The British wanted to be paid for pre-1775 debts; end the confiscation of property and assets of Loyalists; and to keep us out of another alliance with France.


What is known as the Jay Treaty was signed in 1794. It is the first time that arbitration was used (and accepted) by both sides in an international dispute over land boundaries (the U.S/Canadian border) and debts.


Financially, it was a windfall for the U.S. Britain paid us $11,50,000 (or about $301,716,171.72 in 2020 dollars) and we paid the U.K. £550,000 (~£80,260,749.80 in today’s currency or at the exchange rate of £1 = $1.23, $98,720,722.25 in 2020 dollars) for the 1775 debts.


Both countries granted most-favored nation trade rights although the rights for West Indies were “limited.” The treaty more precisely defined the boundaries granted for what was known as the Northwest Territories (Michigan, Ohio, parts of Minnesota, Indiana and Illinois). We also agreed to remain neutral in any war with France. What Jay could not get was an agreement from the British that they would stop impressing American seaman into the Royal Navy.


Even though the treaty was ratified in the U.S. Senate by a vote of 20 – 10. FYI, by now, there were fifteen states – Vermont joined in 1791 and Kentucky in 1792), it set off a political firestorm.


On one side, there were the Federalists led by George Washington and Alexander Hamilton who favored the treaty. The other political party – the Democratic-Republicans – led by Thomas Jefferson and James Madison opposed it vociferously. Madison, who was a member of the House of Representatives, argued that since the treaty involved trade terms, the House (in which the Democratic Republicans had a clear majority) needed to approve it. They also wanted more concessions from the British.


Jefferson’s and the Democratic-Republicans opposition to the treaty cost them the 1796 presidential election. Jefferson became the V.P. and then became the third U.S. president. It is interesting to note that as president, Jefferson did not cancel the treaty.

 •  0 comments  •  flag
Share on Twitter
Published on June 21, 2020 00:57

June 14, 2020

Unintended Consequences of the American Revolution

After Cornwallis surrendered at Yorktown on October 19th, 1781, the British government decided that it wanted out of the war with their rebellious colonists. Yet fighting continued in New Jersey, New York, Nova Scotia, Ohio, Quebec, South Carolina and Virginia until January 22nd, 1783. Forty-four battles were fought after Cornwallis’s surrender!


Negotiations between the warring parties – Spain, France, Great Britain, The Netherlands and the fledgling United States began in April 1782, six months after Yorktown. Even though they still occupied Charleston, Savannah, and New York, the British wanted out of the war. The treaty between the U.S. and the U.K was signed on September 3rd, 1783.


Not every country wanted peace. The Dutch wanted the islands in the Caribbean back that the British had taken and the British wanted to preserve their colonial possessions. France wanted to keep seizing British islands in the Caribbean and re-coup its colonies in India. Spain wanted to take Gibraltar back and along with the French, began an assault on the British fortress in June 1779 that continued until the French and Spanish gave up on February 7th, 1783.


As a result it took not one, but several treaties known as the Peace of Paris to get the warring parties to stop shooting at each other. We – the United States – got what we wanted – independence and recognition as stated in Article 1 of the treaty. It is the only article of the treaty still in force today. Most significant was that one clause gave the United States all the vaguely defined British owned (claimed) land from the Atlantic to the Mississippi south of Canada and north of Spanish owned Florida.


This large tract of land set the stage for the westward territorial expansion of the U.S. setting the stage for an intermittent war with the Native American tribes who lived on this newly acquired territory as well as other acquisitions of land. that lasted until 1924. No American leader believed that we would fight the Indians for 141 years!


Unintended consequence #2 is the French Revolution. Historians debate the effect the American Revolution on France where the monarchy was extremely unpopular, the majority of the population was impoverished, overtaxed and civil liberties as we know them were non-existent. In 1789, six years after the Treaty of Paris was signed, the French Revolution began. One has to believe that the American Revolution had an effect.


In England, after Cornwallis’s surrender, the dominos began to fall and is unintended consequence #3. The First Lord of the Admiralty, Lord Sandwich narrowly avoided being fired over the Royal Navy’s performance. Lord North’s government received a vote of no confidence and Lord Shelburne wanted to try him for his conduct of the war.


Shelbourne, supposedly friendly with Benjamin Franklin, was on record for saying that “he would never consent, under any possible given circumstances, to acknowledge the independency of America” This led to the creation of a coalition government with Lord Rockingham as Prime Minister and Charles Fox as Foreign Secretary. George III hated Rockingham and Fox hated Rockingham, so one can only wonder what the cabinet meetings must have been like.


The French, Dutch and Spanish entered the war on our side not because they were enamored with our desire for freedom, but because they wanted to take back what they lost in the Seven Years War. Their participation in the American Revolution got them nothing. In Louis XVI, it cost him his head.


However, had they not joined, we may not have become independent.

 •  0 comments  •  flag
Share on Twitter
Published on June 14, 2020 01:34

June 7, 2020

Battle for Florida – Part 2

Right after Florida given to the British as part of the treaties that ended The Seven Years War, they divided it into East and West Florida. The Spanish, after they gained back Florida after American Revolution, accepted the new boundaries and never really tried to exert control over Florida.


Soon, the northern part of the state became a haven for American settlers taking over land that belonged to Spain. By the early 1800s, the Napoleonic Wars were raging in Europe and in 1808, Spain was overrun by the French and the Spanish king forced to abdicate. Many Spanish colonies sought an opportunity to get out from under the rule of the Spanish crown. What also died in the French invasion was a U.S. offer to assume some Spanish debt in return ceding Florida. President Madison was afraid that the British would seize Florida and use it as a base against the U.S.


Settlers in the Mississippi Territory and western Florida Americans in the western part of the state took the matter into their own hands and declared the Free and Independent Republic of West Florida. They also appealed to President Madison to take over the territory. He responded by annexing the area claiming it was part of the Louisiana Purchase made in 1803.


Two years later in 1812, President Madison sent General George Matthews to East Florida to meet with the Spanish governor. His orders were negotiate an arrangement to take over East Florida. On his own, Matthews raised a force of Georgians and with the aid of nine U.S. Navy gunboats, seized Amelia Island just 50 miles north of St. Augustine, the Spanish territory’s seat of government for Florida. The rebels, known as “Patriots” declared they were the Republic of East Florida.


Alarmed and afraid the Spanish would react with force, President Madison convinced General Matthews to renounce the republic and return the land to Spain. However, before left Amelia Island in May 1813, Matthews convinced the Seminole king to remain neutral in the conflict between the U.S. and Britain.


However, many of the escaped slaves living amongst the Seminoles came from South Carolina and Georgia did not want to stay neutral. The war for control of Florida was not over. After the war of 1812 ended, British supported Seminoles continued to conduct raids into southern George. This led to the invasion of eastern Florida by General Andrew Jackson and what was known as the First Seminole War. By the end of 1818, the U.S. effectively controlled the east coast of Florida.


Spain realized they could no longer control Florida so in 1821 the U.S. took control of what is now the State of Florida through the Adams-Onis Treaty. East and West Florida were merged together and the capital Tallahassee was created because it was halfway between East Florida’s capital in St. Augustine and West Florida capital in Pensacola.


There were two more wars (II 1835 -1836 and  III 1855 -1858) to force the Seminoles to move to reservations far to the west. In between them, Florida became the 27th state on March 25th, 1845.

 •  0 comments  •  flag
Share on Twitter
Published on June 07, 2020 04:26

May 31, 2020

The Battle for Florida – Part 1

Florida was a battleground state long before it became the 27th State in 1821. The fight began in 1513 after Ponce de Leon landed near modern day St. Augustine, Florida and claimed if for Queen Joanna of Spain. He named the land after the Spanish Easter feast Pascua Florida and from that point on it became La Florida.


Catholic missionaries used St. Augustine as a base until it was burned to the ground in 1586. Pirate and British attacks on the colony continued forcing the Spanish to build the Castillo de San Marcos in 1672. British colonists in Virginia, Georgia and the Carolinas kept pushing south, claiming the territory they claimed for the British crown. In 1704, English Colonel John Moore along with the Yamasee Indians burned St. Augustine again, but could not capture the Castillo de San Marcos.


Instead, they began to raid the 100+ Catholic missions scattered around the territory. The collapse of the Spanish missions as well as the defeat of the Spanish and their Indian allies the Apalachees enabled pirates to use the sheltered harbors along the coast as bases. Yamasee Indians, now pushed out of their native lands in Georgia and South Carolina moved to northern Florida. During the Queen Anne’s War that raged between 1702 – 1713 the French, Spanish and their India allies fought the British and their Indian allies in battles near Pensacola and Mobile.


The Spanish angered the American Colonists by making it known that slaves who escaped plantations would be given refuge in Florida if they converted to Catholicism. This led to a British invasion in 1742 that again destroyed St. Augustine.


At the end of the Seven Years War, Spain ceded Florida to the British. Both agreed that the western border of Florida was the Mississippi River but did not agree on the norther border. If one visualizes the current northern border running from the Atlantic to the Mississippi River, it is a close approximation of what the British and Spanish put on their maps. However, in 1767, the British claimed what is now the lower third of Mississippi and Alabama and southwest Georgia as part of their Florida territory. Other than dispute the claim diplomatically, Spain did nothing about the claim.


To their credit, the British built roads, schools, and encouraged settlements particularly on the east coast and the panhandle. Their interest was strictly commercial because they saw the area as a source of sugar and rum.


When the rebellion broke out in 1775, it took two years for the fighting to reach the territory of Florida which both sides wanted to control. Between the Battle of Thomas Creek in May 1777 to the last action, the siege of Pensacola that ended on May 8th, 1781, there were nine separate battles fought from what is now Baton Rouge and Lake Pontchartrain to Mobile to  Pensacola and of course on the east coast. Most of the citizens in Florida were Loyalists and never sent a representative to the Continental Congress.


However, when the war ended, Britain ceded Florida back to Spain as part of the Treaty of Paris signed in 1783. The northern border was established as the 31st parallel (where it is currently located) by the 1795 Treaty of San Lorenzo.


Unfortunately, the battle for control of Florida was not over. To be continued next week!

 •  0 comments  •  flag
Share on Twitter
Published on May 31, 2020 01:16

May 24, 2020

Edward Bancroft – Britain’s Spy in the American Delegation to France

On March 2nd, 1776, the Committee of Secret Correspondence (after 1777, it was the Committee on Foreign Affairs) formed by Second Continental Congress selected Silas Deane to go to Paris to convince the French to come into the war on our side. There Deane began negotiating with the French Foreign Minister, the Comte de Vergennes. At the same time, he set up a shell company with a famous French character Pierre-Caron de Beaumarchais who besides being an ardent supporter of the American independence was also an inventor, musician, playwright, financier and an arm dealer. Without the munitions the company acquired, the Continental Army wouldn’t have had enough muskets or gunpowder.


Benjamin Franklin instructed Deane to contact his former student, Edward Bancroft who was a Connecticut native and ex-patriate living in London. After meeting with Deane in Paris, Bancroft returned to London to prepare to move to Paris where he would become, once Franklin and Arthur Lee arrived, the American delegation’s secretary.


Once Bancroft came to Paris, Deane recruited the Marquis de Lafayette, Baron Johann de Kalb, Thomas Conway, Casimir Pulaski and Friedrich Wilhelm von Steuben. With the exception of Conway, all these men made a major contribution to the American cause. They did, however, rub some in the Continental Army the wrong way and ultimately led to Deane’s recall from France.


In the beginning, neither Franklin, Lee or Deane knew Bancroft was a British spy. Bancroft did not approve of American independence from Britain. After meeting with Deane in France, Bancroft returned to London where he met with the head of the British Secret Service William Eden and set up how he would pass information to the British government.


Bancroft had access to every piece of correspondence sent or received by the American delegation to France. and passed the relevant content on to the British via innocuous letters that had the real information written in invisible ink. For example, the intelligence he provided the British enabled them to put extreme pressure on the Dutch which delayed the sailing of a new frigate called L’Indien. John Paul Jones was supposed to be its first captain and due to the delays, he was given Bonhomme Richard. What is interesting is that while Jones was waiting for L’Indien to be finished, Bancroft and he became friends and, when Bancroft was accused of being a spy, Jones came to his defense.


Another example is that the British government knew details about the negotiations between the Americans and the French but were unable to prevent it from being signed. Supposedly, King George III had copies of the treaty between the United States and France about two days after it was signed.


After the war, Bancroft remained in England and continued increase his personal fortune. It was not until 1789 that he was unmasked and his treachery became known. What is strange is that Benjamin Franklin, known for his distaste for Loyalists, one of whom was his own son, still continued to correspond with Bancroft after the war.

 •  0 comments  •  flag
Share on Twitter
Published on May 24, 2020 00:25

May 17, 2020

The South Carolina Navy in the American Revolution

In an earlier post, The Strange Story of the Frigate L’Indien, was told. L’Indien, a.k.a. South Carolina (40 guns) was built in Amsterdam based on a French design. The South Carolina Navy came into existence in July 1775 when the Provincial Congress’ Council of Safety (officially it wasn’t a state until the Articles of Confederation were ratified on February 4th, 1778 by the South Carolina provincial legislature) authorized two captains to outfit a ship to assist neighboring Georgia to seize British gunpowder in Nassau, Bahamas.


Before the ship – Commerce – left Charleston, word was received that the British ships were headed to nearby Savannah. The action netted 25,000 pounds of gunpowder which was an enormous amount and desperately needed by the rebels. This success led to two more ships, the schooner Defence and a brig named Comet which was sent to Boston to recruit up to 300 men for the South Carolina Navy.


Of the 13 Colonies, three – South Carolina, Massachusetts and New York – formed what we would consider “blue water” navies, i.e. those that operated ships well outside territorial waters. Some of the other 10 Colonies formed smaller navies that stayed close to shore and could be classified as “brown water” navies. All of this activity was in addition to the Continental Navy that was formed by the Second Continental Congress and issuing letters of marque to consortiums who operated privateers.


Unlike the current U.S. Constitution, under the Articles of Confederation, the states had the rights to form their own armies and navies. The political and funding difficulties (because the Continental Congress could not levy taxes) with this situation plagued the Congress throughout the American Revolution.


Ultimately, in addition to L’Indien/South Carolina, the South Carolina Navy operated 10 other sea going ships – the frigates Bricole, (36 guns); Rattlesnake and Truite (26 guns) and General Moultrie (18 guns); brigs Polly (20 guns), Prosper (20 guns), Notre Dame (16 guns), Comet (16 guns), Hornet (14 guns), and Fair American (14 guns).


During their lifespan, the ships preyed on British merchant shipping and occasionally engaged smaller ships of the Royal Navy. Their primary mission was to keep the Royal Navy from effectively blockading Charleston.


History says the South Carolina Navy succeeded until 1780. The first British attempt to take Charleston was in 1776 and was beaten back. The landing failed and the Royal Navy had several ships heavily damaged and lost H.M.S. Acheon (28 guns) when it ran aground and couldn’t be pulled off. The failure to take Charleston caused the British to focus on the northern colonies.


But after the Royal Army’s defeat at Saratoga, the British strategy changed and again it turned its attention to Charleston. Knowing their ships could not stand up to the Royal Navy’s frigates that had more and heavier guns, the South Carolina Navy leadership pulled it ships into Charleston harbor.


Bricole was converted to a floating battery with fourteen 12-pounders and twenty-two 8-pounders. She was sunk along with Truite to prevent the Royal Navy from entering the harbor. Notre Dame and General Moultrie were destroyed and after Charleston was captured by the British, the South Carolina Navy no longer had a base and for the remainder of the war, was not very effective.

 •  0 comments  •  flag
Share on Twitter
Published on May 17, 2020 00:38

May 10, 2020

Spain’s Vital Role in the American Revolution

The history books are full of stories about how the French helped our Founding Fathers wage war against Great Britain. Spain played a very significant role during the American Revolution because they saw it as a way to protect their colonies in North and South America as well as recover territory lost to Britain during the Seven Years War.


Besides along the coast of North America, Britain fought the French and Spanish on land and at sea in Europe, Caribbean, South America, and India. In short, France, Britain and Spain were again emmeshed in a global war 12 years after the prior one ended.


Had Britain, the wealthiest and most powerful country in the world been able to focus on its 13 rebellious colonies, the war may have turned out differently. Instead, Britain had to protect its overseas territories as well as fight a determined group of folks who wanted independence.


Ever since Spain lost Gibraltar to the British in 1704, they wanted (and still do) it back. Another target was the Balearic Islands (the largest of which is Majorca) in the Western Mediterranean that were taken by the British during the Seven Years War.


In the treaties that ended, the Seven Years War, France transferred all of its territory west of the Mississippi to Spain which lost Florida from the east coast to the Mississippi to the British. Most important to Spain, Britain returned Havana which it had captured and Spain kept its mineral rich possessions in South and Central America.


In 1776, shortly after the rebellion broke out in the Thirteen Colonies, Spain began shipping war materiel to Charleston and New Orleans (which was in Spanish territory) through the House of Gardoqui, a New Orleans based trading company. The formal declaration didn’t come until April 1779 even though the Spanish were up to their eyeballs the fighting.


Spain provided weapons, musket balls and gunpowder for battles in American Midwest, Florida and the Battle at Yorktown. (More on Florida in another post). Spanish garrisons in the Louisiana territory repelled British attacks. Supplied by the Spanish, George Rogers Clark (the Clark of the Lewis and Clark Expedition) captured the fort at Vincennes, IN. Another Spanish supported expedition took Fort Joseph in Michigan.


While Generals Washington and Greene pursued a retreating Cornwallis to Yorktown, the Continental Congress ran out of money. The Spanish raised some of the cash in Havana to pay for supplies for both the French and Continental Armies as well as pay their soldiers.


The American Revolution turned out well for Spain. One, they kept the Balearic Islands. Two, British strength in the Caribbean was weakened thus reducing the threat to Spanish possessions in Central and South America.


During the war, Don Diego de Gardoqui, who ran the company bearing his name, became friends with George Washington and was appointed as Spain’s first ambassador to the United States. He also marched in Washington’s first inaugural parade and provided livestock to restock the president’s herd at Mount Vernon.

 •  0 comments  •  flag
Share on Twitter
Published on May 10, 2020 02:06

May 3, 2020

The Strange Case of the Frigate L’Indien a.k.a. South Carolina

Throughout the American Revolution, our Founding Fathers were desperate for ships that could take on the Royal Navy on equal terms. Before France entered the war, French ship designer Jacques Boux was commissioned to design a large warship. What Boux laid out was a 40-gun frigate with the structure of a 74 gun ship-of-the-line.


It was built and launched in 1778 in Amsterdam with twenty-eight Swedish made 36-pounders and twelve long 12-pounders that would out-range normal size guns of their caliber. With the ship in the water, the British put extensive pressure on the Dutch not to let it leave. Its first captain was to be John Paul Jones, but for three years, the British managed to keep the ship named L’Indien in port.


British pressure forced the shipyard to sell L’Indien to Louis XVI in 1781 who then gave it to the Duke of Luxembourg who turned it over to the South Carolina Navy in return for 25% of any prize money. Yes, the State of Carolina had authorized a Navy and it operated independent of the Continental Navy. More about them in a later blog.


L’Indien’s first captain was Alexander Gillon who was in France to buy ships for his state’s navy and he renamed her South Carolina. The heavily armed ship sailed for Charleston in late 1781 with a mixed crew of American and European seaman. Since the British occupied Charleston, Gillon took South Carolina and her prizes to Havana, Cuba.


In the spring of 1782, South Carolina joined a Spanish force that captured the Bahamas and Gillion headed north to Philadelphia. There she sat for six months and the Duke of Luxembourg replaced Gillon with John Joyner.


While in port, South Carolina was inspected by Joshua Humphreys who found it full of innovative features, particularly the design and shape of its hull. Twelve years later, Humphreys improved on Boux’s hull design when he created what would become the U.S.S. Constitution and U.S.S. Constellation.


Manned with an inexperienced crew that included eight former British and 50 Hessian soldiers that were captured during the Battle of Saratoga, Joyner took South Carolina to sea in November 1782. He didn’t make it to the Atlantic because in Delaware Bay, he ran into H.M.S. Diomede, 44 guns and two 32-gun frigates H.M.S. Quebec and H.M.S. Astraea. The British chased South Carolina for 18 hours before they boxed her in. After being bombarded for two hours, Joyner hauled down his flag.


The British didn’t think South Carolina was fit to be a warship so she was converted to a transport and 600 German soldiers back to Germany from New York in 1783. Not much is known about South Carolina’s fate other than during World War II, her bell was found in a rope mill on the Ganges River between Kolkata (then Calcutta) and the Indian Ocean. The presumption was that she was sold by the Royal Navy and used as a merchantman. The location of the bell suggests that she made at least one voyage to India.


 

 •  0 comments  •  flag
Share on Twitter
Published on May 03, 2020 00:14

April 26, 2020

A Shell Company Provides Arms to the American Revolution

They say timing is everything. Many words could be used to describe Pierre Beaumarchais. Playwright and arms merchant are just a few. Scoundrel, watchmaker, revolutionary, entrepreneur and murderer could also be used.


His first two wives died mysteriously and despite having penned the three plays – Le Barbier de SévilleLe Mariage de Figaro, and La Mère Coupable in the 1760s, Beaumarchais was in deep legal and financial trouble in 1775 and needed a way out. France was still smarting from its defeat in The Seven Years War which ended in 1765 and the Comte de Vergennes, Charles Gravier was the foreign minister and looking for ways to get back at Great Britain.


The American Revolution and Pierre-Augustin Caron de Beaumarchais provided an opportunity. Beaumarchais had approached him with an offer to help Louis XVI in return for what amounted to a pardon. He had already taken on a mission to England to track down a French diplomat who attempted to blackmail Louis XVI.


Beaumarchais created a shell company called Rodrique Hortelez and Company chartered in both France and Spain. It had a “business” relationship with two Americans, Silas Deane and Thomas Morris, brother of the American financier Robert Morris, who helped fund the American Revolution. Deane was a member of the Connecticut delegation to the Continental Congress and later, part of Benjamin Franklin’s delegation to France. He was the Comte de Vergennes contact.


By the time the Declaration of Independence was signed, the munitions were flowing from France and Spain through the Dutch island of St. Eustatius in the Caribbean. It was enough materiel to keep the Continental Army clothed and equipped in 1776.


When the Treaty of Alliance was signed, Beaumarchais was given his full civil rights back. He was an early supporter of the French Revolution and while out of the country, his enemies had him labeled a loyalist. It took him two years to clear his name and he returned to Paris where he died in 1799.


All did not end well for Deane even though the American Revolution succeeded. The British were gone but one of Deane’s associates, Arthur Lee was not happy. He had spent the war in both France and the U.K. and helped negotiate the Treaty of Alliance with France and felt “cut out.” Lee engineered the recall of Deane to the U.S. based on the accusations that not all of the contracted equipment arrived in the U.S. and vowed neither Deane nor Beaumarchais would be paid.


Deane was allowed to go back to Paris to collect his business records but by then most of his investments had failed and the merchant ships he owned had been captured by the British. He spent the rest of his life trying to clear his name.


Almost broke and ill, Silas Deane died in 1791 on a ship that was to bring him back to the United States. Philura Deane Alden, Deane’s granddaughter continued the fight to clear his name and receive compensation. In 1841, the Congress awarded her – $37,000 (~$1,097,730 today) and issued an apology stating the way her grandfather was treated was a gross injustice.

 •  0 comments  •  flag
Share on Twitter
Published on April 26, 2020 00:40

April 19, 2020

Economic Crisis of the 1780s

Once the celebrations over the signing of the Treaty of Paris were over in the new United States, reality set in. The government was deeply in debt to its citizens as well as to foreign powers. According to HistoryCentral.com, our country owed other countries $12M and its citizens $44M. State governments borrowed another $25M from the people for a total of $81M, In 2020 dollars, it translates to $1,972,386,207 or, approximately $631 for each of the 3,134,172 citizens of the new country. Back then, $631 was a lot of money!


To pay its citizens back, the Continental Congress and state legislatures had to tax those same citizens who lent the money to fund the war to get the money to pay off their loans or for the good and services they provided to the Continental Army and Navy. In other words, let me tax you so I can give you the money back!


Those who were in debt due to money owed to them by the government, didn’t have the money to pay it back. Well known financiers who raised money through bonds and loans wound up in debtors prison because the government could not raise the money to pay them.


It gets worse. Right after the Treaty of Paris was signed, U.S. exports to Britain, our largest market before the Revolution and trade with the British held islands in the Caribbean was prohibited. France went into recession so that market died. Even if we could have sent goods overseas, the country didn’t have enough ships to carry the cargo because many American owned merchant ships had been seized by the British.


Before the Revolution, our ships were protected by the Royal Navy. After the French joined on our side, their Navy protected our merchant shipping. We disbanded our navy so there was no force to protect them.


And, yes, it still gets worse. Inflation was rampant. Not out of control, but significant. Some economists estimate that per capita income dropped 22%!


One major problem was our country was operating under the Articles of Confederation which was an agreement by design that gave our national leaders very little power.


This economic crisis and the realization that in order for the United States to succeed, it needed to replace the Articles of Confederation with a new document that created a strong, but limited Federal government. The process to create a workable document agreeable to all the states began on May 25, 1787 and ended roughly four months later on September 17, 1787.


On September 28th, 1787, the Constitution was submitted to the states for ratification. Nine were needed for it to be adopted and on June 21st, 1788, New Hampshire became the ninth state to ratify the U.S. Constitution followed quickly by New York, New Jersey and Virginia. North Carolina adopted it on November 29th, 1789 and Rhode Island was the last to ratify on May 29th, 1790. The rest, as they say, is history.

 •  0 comments  •  flag
Share on Twitter
Published on April 19, 2020 01:07