Like many young farmers in Massachusetts, Daniel Shays enlisted in a local militia company in the early 1770s. Born to Irish parents in Hopkinton, Massachusetts, in 1747 and one of six children, Daniel received little formal education. In 1772 he married, had a child, and settled into farming. But in April 1775, he, his father, and his brother grabbed muskets and raced toward Concord to meet the British forces. By June, he was among the patriots defending Breed's Hill and Bunker Hill.
After distinguished service in the Continental Army, Shays resigned from service in 1780 and purchased a farm in Pelham, Massachusetts. He hoped to return to a normal life, but in the years following the Revolution, the nation entered a period of economic turmoil. Farmers in western Massachusetts, many deeply in debt, were especially hard hit. Debtors, including former soldiers and their families, lost their land, tools, livestock, clothes, and furniture, and many were also imprisoned. Although Shays managed to keep his farm, many of his neighbors faced eviction. Shays was chosen to represent his town at county conventions that petitioned the state government for economic relief. However, the Massachusetts legislature, sitting in Boston, largely ignored their concerns.
Angered by the legislature's failure to act, armed groups of farmers attacked courthouses throughout western Massachusetts in 1786. Although Shays was reluctant to lead the movement, he soon headed the largest contingent of farmer-soldiers, a band that eventually numbered more than a thousand men. After a series of small skirmishes against local militias, Massachusetts governor James Bowdoin moved to quash the rebellion. In January 1787, Shays and his men headed to the federal arsenal at Springfield, Massachusetts, to seize guns and ammunition. The farmers were routed by state militia and pursued by the governor's army. Many rebel leaders were captured; others, including Shays, escaped to Vermont and later New York State. Four were convicted and two were hanged before Bowdoin granted amnesty to the rest of the rebels, in hopes of avoiding further conflict.
This uprising, known as Shays's Rebellion, fueled grave concern on the part of many state and national leaders. They feared that the U.S. government was too weak to put down such insurgencies and advocated amending or replacing the Articles of Confederation to create a new political structure that would strengthen federal power. Among those outraged by the rebels was Alexander Hamilton, a young New York politician with an admirable record of military service. Hamilton was born illegitimate and impoverished in the British West Indies. Orphaned at eleven, he was apprenticed to a firm of merchants, where his gift for commerce and finance quickly became clear. The firm sent him for schooling to the American colonies, where he was drawn into the activities of radical patriots. Hamilton joined the Continental Army in 1776 and gained a reputation as courageous, even reckless, in the pursuit of military glory.
During the war, Hamilton fell in love with Elizabeth Schuyler, who came from a wealthy New York family, and they married in December 1780. After the American victory, Hamilton used military and marital contacts to establish himself as a lawyer and financier in New York City. In 1786 he focused his efforts on improving the state of the nation's finances. He was elected to the New York State legislature that spring and by fall was serving as a delegate to a convention on interstate commerce held in Annapolis, Maryland. Hamilton was among a small group of delegates who sought to strengthen the central government. They pushed through a resolution calling for a second convention "to render the constitution of the Federal Government adequate to the exigencies of the Union."
Although the initial response to the call was lukewarm, the eruption of Shays's Rebellion and the federal government's financial problems soon convinced many in the congress and the states that change was required. Although Hamilton played only a small role in the 1787 convention in Philadelphia, he worked tirelessly for ratification of the Constitution drafted there. Once the new federal government was established, in the fall of 1789 Hamilton accepted appointment to the job he most deeply desired, secretary of the treasury.
Farmer plowing near Moravian settlement of Salem, North Carolina, 1787. The Granger Collection, New York
AS ALEXANDER HAMILTON
took charge of the nation’s economic policy, Daniel Shays retreated to a modest living on the frontiers of New York State. Despite the suppression of Shays’s Rebellion, the grievances that fueled the uprising persisted, and other problems confronted the new nation as well. Moreover, Hamilton’s efforts to stabilize and strengthen the national economy, although deemed successful by many political and economic elites, sparked controversy and conflicts in the years ahead. As the American histories of Daniel Shays and Alexander Hamilton demonstrate, Americans may have come together to win the Revolutionary War, but not all Americans shared a common vision of the independent nation that military victory made possible.
The United States faced serious financial instability in its formative years. Other issues also threatened the emerging nation. Indians, with support from British allies, continued to launch raids against frontier settlements. Western migrants fueled these conflicts and forced the confederation government to take a more active role in governing its frontier territories. Meanwhile Spain closed the port of New Orleans to U.S. trade as states struggled to regulate commerce within the nation and abroad. Another threat to American trade arose off the coast of North Africa, where Barbary pirates attacked U.S. merchant ships. Issues of trade and piracy required diplomacy with European powers, but diplomatic relations were plagued with uncertainty given America’s outstanding war debts and the relative weakness of the confederation government.
Officers Threaten Mutiny
As the American Revolution ground to an end, issues of military pay and government finances sparked conflict. Uprisings by ordinary soldiers were common but successfully put down. Threats by Continental officers, however, posed a greater problem. In March 1783, some five hundred officers were still encamped at Newburgh, New York. Many officers came from wealthy families and had served without pay during the war. In 1780 they had extracted a promise from the Continental Congress for half pay for life but had received no compensation since.
Some confederation leaders were sympathetic to the officers’ plight and hoped to use pressure from this formidable group to enhance the powers of the congress. Hamilton was among the leaders pressing state governments to grant the confederation congress a new duty of 5 percent on imported goods. The federal government would thereby gain an independent source of revenue by which it could begin paying off its debts and ensure the loyalty of wealthy Americans who had helped finance the war. Perhaps the actions of the officers at Newburgh could convince states like New York to agree to the collection of this import duty.
Quietly encouraged by these supporters, dissident officers circulated petitions that included veiled threats of a military takeover. When the officers met on March 15, however, they were confronted by General George Washington, who urged the officers to respect civilian control of the government and to allow the fragile U.S. government time to prove itself. Most of the Newburgh officers quickly retreated from the “infamous propositions” circulated earlier. At the same time, congressional leaders, fearing a mutiny, promised the officers full pay for five years. Within weeks, news arrived that a peace treaty was near completion in Paris, and over the next three months the officers headed home.
Indians, Land, and the Northwest Ordinance
One anonymous petitioner at Newburgh suggested that the officers move as a group to “some unsettled country” and let the confederation fend for itself. In reality, no such unsettled country existed beyond the thirteen states. Numerous Indian nations and American settlers claimed control of these western lands, and more American settlers were arriving all the time. In 1784 some two hundred Indian leaders from the Iroquois, Shawnee, Creek, Cherokee, and other nations gathered in St. Louis, where they complained to the Spanish governor that the Americans were “extending themselves like a plague of locusts.”
Despite the continued presence of British and Spanish troops in the Ohio River valley, the United States hoped to convince Indian nations—both friendly and hostile—that it controlled the territory. The confederation congress sought to strengthen these claims by signing treaties with the vanquished nations. In the fall of 1784, U.S. commissioners met with Iroquois delegates at Fort Stanwix, New York, and demanded land cessions that covered all of western New York and Pennsylvania as well as areas farther west. They backed up their demands with the threat of force. Although the six Indian nations in the council later refused to ratify the treaty, the U.S. government acted as though the treaty was valid. With a similar mix of negotiation and coercion, U.S. commissioners signed treaties at Fort McIntosh, Pennsylvania (1785), and Fort Finney, Ohio (1786), and claimed lands held by the Wyandots, Delawares, Shawnees, and others.
As more and more eastern Indians were pushed into the Ohio River valley, they crowded onto lands already claimed by other nations. Initially, these migrations increased conflict among Indians, but eventually some leaders used this forced intimacy to launch pan-Indian movements against further American encroachment on their land.
Indians and U.S. political leaders did share one concern over western lands: the vast numbers of squatters, mainly white men and women, who moved onto land to which they had no legal claim. In the fall of 1784, George Washington traveled with family members and slaves to survey nearly thirty thousand acres of western territory he had been granted as a reward for military service. He found much of the land occupied by squatters who refused to purchase their homesteads or pay rent to Washington. Unable to impose his will on the squatters, he became more deeply concerned about the weaknesses of the confederation government.
Washington feared that the federal government was not strong enough to protect his and others’ property rights. Indeed, the confederation congress struggled just to convince the remaining states with western land claims to cede that territory to federal control. Slowly, however, between 1783 and 1785, the congress convinced the two remaining states with the largest western land claims, Virginia and Massachusetts, to relinquish all territory north of the Ohio River (Map 7.1).
Cessions of Western Land, 1782-1802 Beginning with the congress established under the Articles of Confederation, political leaders sought to resolve competing state claims to western territory based on colonial charters. The confederation congress and, after ratification of the Constitution, the U.S. Congress gradually persuaded all states to cede their claims and create a "national domain," part of which was then organized as the Northwest Territory.
To regulate this vast territory, Thomas Jefferson drafted the Northwest Land Ordinance in 1785. It provided that the territory be surveyed and divided into adjoining townships of thirty-six sections, each 1 square mile (640 acres) in area. He hoped to carve fourteen small states out of the region to enhance the representation of western farmers and to ensure the continued dominance of agrarian views in the national government. The congress revised his proposal, however, stipulating that only three to five states be created from the vast territory.
The population of the territory grew rapidly, with speculators buying up huge tracts of land and selling smaller parcels to eager settlers. In response, congressional leaders modified the original Northwest Ordinance in 1787 and clarified the process by which territories could become states. The congress appointed territorial officials and guaranteed residents the basic rights of U.S. citizens. After a territory’s population reached 5,000, residents could choose an assembly, but the territorial governor retained the power to veto all legislation. When a prospective state reached a population of 60,000, it could apply for admission to the United States on an equal basis with the existing states. Thus the congress established an orderly system by which territories became states in the Union.
The 1787 ordinance also addressed concerns about race and political power in the region, though with mixed results. It encouraged fair treatment of Indian nations, although it did not include any means of enforcing such treatment and failed to resolve Indian land claims. It abolished slavery throughout the territory, but the law included a clause that mandated the return of fugitive slaves to their owners to forestall a flood of fugitives into the Northwest Territory. By restricting the number of states established in the territory, the ordinance also sought to limit the future clout of western settlers in the federal government.
Meanwhile, ownership of the region south of the Ohio River and west of the original thirteen states remained in dispute. By 1785 thirty thousand Americans had settled in Kentucky, and thousands more streamed into Tennessee. Spanish officials claimed rights to this land and signed treaties with Creek, Choctaw, and Chickasaw tribes in the area. Supplied with weapons by Spanish traders, these Indians along with Cherokees harassed Anglo-American settlers in the lower Mississippi valley. The region would remain an arena of conflict for decades to come.
Depression and Debt
Disputes over western lands were deeply intertwined with the economic difficulties that plagued the new nation. Victory in the Revolution was followed by years of economic depression and mushrooming debt. The war had fueled the demand for domestic goods and ensured high employment. However, after the peace settlement, both the demand and the jobs declined. In addition, international trade was slow to recover from a decade of disruption. Meanwhile, the nation was saddled with a huge war debt. Individuals, the states, and the federal government each viewed western lands as a solution to their problems. Farm families could move west and start over on “unclaimed” land; states could distribute land in lieu of cash payments to veterans or creditors; and the congress could sell land to fund its debts. Yet there was never enough land to meet these conflicting needs, nor did the United States hold secure title to the territory.
Some national leaders, including Hamilton, focused on other ways of repaying the war debt. Fearing that wealthy creditors would lose faith in the new nation if it could not repay its debts, they wanted to grant the federal government the right to collect a percentage of import duties as a way to increase its revenue. Meanwhile, legislators in a number of states, including Massachusetts, passed hard-money laws that required debts to be repaid in gold or silver rather than in paper currency. Creditors—mainly well-to-do merchants and professionals—favored hard-money measures to ensure repayment in full. Artisans and small farmers, including many veterans who had borrowed paper money during the war, were now asked to repay loans in hard currency as the money supply shrank. Taxes, too, were rising as states sought to cover the interest on wartime bonds held by affluent investors.
Failures of American diplomacy weakened the nation’s economy further. In 1783 the British Parliament denied the United States the right to trade with the British West Indies, and New England merchants lost lucrative markets for fish, grain, and lumber. The following year, Spain, unhappy with Americans’ insistence on pushing into disputed western territories, prohibited U.S. ships from accessing the port of New Orleans. This embargo closed off a primary trade route for western settlers. Spain and Great Britain also threatened U.S. sovereignty by conspiring with American citizens on the frontier and promising them protection from Indians. At the same time, British troops that had refused to abandon forts in the western United States urged Indians to harass frontier settlers.
The United States fared better in its relations with France and Holland. Both nations granted American ships the right to trade with their West Indies colonies. Yet the continuation of America’s wartime alliance with France also ensured continued conflicts with Great Britain.
REVIEW & RELATE
• What challenges did the new nation face in the immediate aftermath of the Revolutionary War?
• How and why did the conflict between America and Great Britain continue after the war ended?