Continental Dollars and Depression
The new Congress immediately began printing paper
currency to pay for the Revolutionary War. The money became
the standard U.S. currency during the war, but when hard times hit
and inflation skyrocketed, these Continental dollars became worthless.
Many Americans, especially soldiers, small business owners, and
farmers, were hit hard. Congress requested that the states increase
taxes to help pay for a new national currency, but most states refused
and instead printed their own paper money. This, too, succumbed
to inflation, and by the end of the war, Americans had fistfuls
of worthless money.
Western Land Disputes
Congress had much more success dealing with U.S. territories
west of the Appalachians. Prior to the Revolutionary War, many of
the original thirteen colonial legislatures made territorial
claims to these lands. Interstate disputes over these western
areas were common and heated: Maryland (which had no western claims)
even refused to ratify the Articles of Confederation until the other
states had ceded their claims. The conflict was resolved in 1781 when
Virginia ceded all western lands to Congress’s control so that all
Americans could benefit from the land. Other states followed suit,
and within a few years the national government was responsible for
governing these territories.
Land Ordinance of 1785
Congress then passed the Land Ordinance
of 1785 to
establish order in the West. The ordinance stipulated that new western
towns were to be thirty-six miles square, with one square mile set
aside for schools. All public lands were to be auctioned off to
the highest bidders, providing all Americans the chance to migrate
and settle in the West.
Northwest Ordinance of 1787
Later, Congress passed the Northwest Ordinance of 1787to
establish a process for admitting these territories to the Union
as states. Each territory was to be governed by Congress until it
contained 5,000 free, white males. Then settlers
could vote whether to become a permanent state on equal footing
as all the other states in the Union.
The Northwest Ordinance also abolished slavery in
the territories and granted freedom of religion and the right
to trial by jury. Although the ordinance promised decent treatment
to Native Americans, it did not, in reality, extend these rights
to them. In fact, the United States obtained much of this land by
extortion and violence against Native Americans.
Legacy of the Land Ordinances
These land ordinances were the only major successes
that Congress had under the Articles. The Northwest Ordinance proved
incredibly successful and influential because it allowed the small
country to grow without devolving into an undemocratic empire. Unlike
European powers that exploited their territories as colonies to
be mined, Congress declared that all American territories could
become fully equal states with the same status and
privileges as the original founding states. In later years many
Americans would interpret this to mean that it was their
duty to expand democracy as far west as they could.
