U.S. Political Economy
1788-1864
Return to U.S. Economic Cycle History Updated 2/20/22 Please link to and Share
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U.S. Political Economy Return to U.S. Economic Cycle History Updated 2/20/22 Please link to and Share |
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Prelude Traditional view that the Revolution was fought for liberties Americans felt as English citizens they already possessed. This should be merged with the political and economic view that the war was fought to transfer power from a British elite to a homegrown American power class. Needing money to pay for the Seven Years War with France, Parliament passed what it thought a entirely reasonable 1764 Sugar Act. It put a tariff on sugar, coffee, wine and other imports into America. The colonies, were in recession which is usually the case after high wartime spending. They responded negatively with the resulting political slogan "No Taxation Without Representation." British bungling, economic realities, the Age of Enlightenment and historic inevitability also played a role in why the war was fought.
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The Economics
Needing money to pay for the Seven Years War
with France, Parliament passed what it thought a entirely reasonable 1764
Sugar Act. It put a tariff on sugar, coffee, wine and other
imports into America. The colonies, were in recession which is usually the case
after high wartime spending. They responded negatively with the resulting
political slogan "No Taxation Without Representation." Politicians were looking for more than a
few seats in Parliament Wanted to drive a wedge between Mother England and the
Colonies, they were seeking a larger prize. Resistance to the sugar tax was negligible
until a second 1765 Stamp Act put a stiff tariff on all printed matter
from newspapers and legal documents to playing cards. This was not a tax on
trade but a direct tax and America protests grew louder and more violent. In
Boston the house of British Governor Thomas Henderson was destroyed by an angry
mob. In New York the home of the officer in charge of the Stamp Act was
ransacked. This time boycotts were successful and the act was repealed. |
The Politics
Elections 1788-1824 England's Political Influence Finally
Ends and the South Has Some Success
in Controlling Northern Business Interests.\
Federalists favored unity through a strong
central government, close ties to Britain, a centralized banking system, and
close links between the government and the men of wealth who should run government.
Republicans under Jefferson Madison
and Monroe strongly opposed
Alexander Hamilton's Federalist agenda. They stressed being more of a Republic where the
individual is sovereign as opposed to democracy where the sovereign is
the group, the majority.
Elections 1856-1896
Civil War Ends, Northeast Takes Control,
The Gilded Age is Built on the Backs of the Poor, Especially Women, Immigrants, and Blacks
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Supreme Court
3) Supreme Court as "Supreme Constitutional Authority" begins with 1803 Marbury v. Madison granted Judicial Review power to the Supreme Court 4) Protecting Business Not Yet!
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2. The Economics The Democratic-Republican Party of Jefferson became factionalized in the 1820's so Jackson supporters began to form the modern Democratic Party. It hoped to pass political power from an established elites to ordinary voters by ending the spoils system. |
They continued the
Bank
War against eastern business interests by opposing the
renewal of the
Second Bank of the United States. Democrats also
opposed Whig would build up industry with
protectionism at the expense of
taxpayers. |
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1789-93 Copper Panic
occurred when
copper coins were debased by counterfeiting led to commercial freeze up in several northern States. Hamilton's National Finance System helped for awhile |
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Panic of 1796-99 caused by a
bursting land bubble and a lack of good money. A Major northern financial panic resulted when the central bank of England withheld species to minimize their insolvency due to war debts. Many business failed but prosperity continued in the south. President Adams kept US out of a European War. It cost the very old sickly man reelection. |
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1819 Panic
occurred when the Embargo Act and the War of
1812 caused foreclosures, bank failures, unemployment, and slumps in agriculture and manufacturing. |
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1825 European Panic
affected the US. See The Most Fantastic Financial Swindle-of-All-Time from the St. Louis Federal Reserve Bank. |
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1837 Panic was the first
speculative fever
Financial crisis. It started in NY City when banks would only accept specie (gold and silver coinage) because they questioned the value of state currencies. |
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1857 Panic was caused by over-consumption of Europe
goods. This drained Specie during a period of overbuilding by competing railroads and rampant Western land speculation. |
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Election Summaries |
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"And Now the Rest of the Story" |
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Election 1788 and 1792
General George Washington, unopposed, was the Electoral College choice. His Farewell Address warned that a union of states would come under frequent attacks by foreign and domestic enemies, the importance of separation of powers and checks and balances, and political factions who obstruct the execution of laws. |
George
Washington 1788 to early 1793 Bill of Rights added to the Constitution but didn't apply to state law until 1929. Executive privilege was used to keep Jay Treaty documents from Congress.Think Pentagon Papers. The Whiskey Rebellion of 1791against federal taxes failed. Think It was the first of many fights against taxes. |
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| Election 1796 had first political parties with the Jeffersonian-Republicans accusing the ruling Federalists of favoring an Oligarchy of the wealthy. Most favored Federalists Treasury secretary Alexander Hamilton who was not nominated as he had created many enemies and would not beat Jefferson. |
John
Adams 1793 to early 2001 Alien and Sedition Acts limited citizen rights and sent news people to jail as paranoia swept America because a liberal democratic revolutions was ravaging Europe. War would cause most future Presidents to limit freedoms in the name of national security. Marbury v. Madison resulted in the process of Judicial Review Was the Court creating law? Did SC go from 3rd to 1st in the power battle? |
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Eection of 1800 an Electoral College tie was decided by an outgoing House of Reprehensive elected. Jefferson won over Federalist Adams. The three-fifths compromise and increased slave numbers meant more southern victories and much future consternation. Political philosophy attributed to of Jefferson influenced many for over 200 years. |
T. Jefferson
1801–1808 Jefferson's political inconsistency was verified by Louisiana Purchase as he ignored his strict constructionist. Embargo Act of 1807 was another example of his ignoring strict constitutional interpretation. It halted trade with Europe because warring countries were not respecting freedom of the seas. It really hurt New England merchants and was perceived as favoring France over Brittan. |
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Election of 1808
had opposition to Jefferson's export ban
but friend Madison easily won over Charles
Pinckney. Election of 1812 was fought in the shadow of the War of 1812. It was intriguing as Democratic-Republican candidate President Madison was opposed by fellow party member D. Clinton the nephew of Madison's late VP G. Clinton. Candidate Clinton was anti-war in the North and for war in the South. Federalist R. King received no electoral votes. |
J. Madison 1809–1816
Founding the Democratic-Republican Party Father of the Bill of Rights Editor's Note: Jefferson and Madison both wanted a limited federal government, strict interpretation of the constitution, and no debt. But they wanted to buy Louisiana and West Florida so they temporarily stopped being Strict Constructionists. Bank of United States charter was not renewed in an attempt to limit business influence but paying for the War of 1812 required such an institution and Madison agreed. The Infant industry argument along with revenue collection resulted in the Tariff of 1816. |
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| Election, 1816 began the Era of Good Feelings (1816–1824) and ended the First Party System. It was run by Eastern money interests who wanted protective tariffs with resulting revenue to help industry. Rural interests wanted low tariffs with resulting cheaper goods. The Federalist's elitism had diminished their influence and their anti-war stance proved devastating when the war ended well. Plus some of Federalist beliefs were adopted by easy winner Monroe. |
J. Monroe
1817–1824
Implied powers were derived from the Necessary and Proper Clause during the 1819 McCulloch v. Maryland U.S. bank case . Congress won power battle. Monroe Doctrine of 1823 keeps U.S out of European politics until WWI. It was also done to keep Europe out of the Caribbean and far western territories. These were to be US spheres of influence. European monarch, especially after the anarchy of the French Revolution, were very anti-democratic. Editor's Note: The Northeast business interest vs. South/West rural interest battles continues today. |
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| Election of 1824 had the Democratic-Republican Party splintered with four presidential candidates. A Second Party System was coming. Later the Andrew Jackson faction evolved into the modern Democratic Party while factions led by John Quincy Adams and Henry Clay would become the National Republican Party. Then the Whig Party. The corrupt bargain elected J. Q. Adams for one term. |
J. Q. Adams
1825–1828
The "American
System" of internal improvements of road-building, a national
bank to help productive Eastern business and a national currency all initiated by Alexander Hamilton were financed by the
1828 "Tariff
of Abominations. It later caused the
Nullification Crisis as states questioned federal authority
over states. Editor's Note:
This was beginning of the two continuing fights, 1) the use
of tariff to finance government 2) states versus
federal power. J. Calhoun and H. Clay controlled the National Republican Party with a less restrictive Federalists agenda than A. Hamilton. |
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4.
Supreme Court Rulings Established Power Centers
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