Stabilizing the American Economy After the Revolution

Updated on June 6, 2018
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Rebecca Graf is a seasoned writer with nearly a decade of experience and degrees in accounting, history, and creative writing.

In the 1790s, America was still floundering to find its economic footing after pulling away from Britain. Being part of the British economic system had its advantages, which were very apparent to the Americans once they found themselves removed from it. As they found themselves politically independent and structuring a new government, they were simultaneously structuring a new economic system that would prove to be trickier than they had imagined.

It would take individual determination and political maneuverings to get America economically stable and strong. Thank goodness there were individuals who could do it.


Industrial Revolution Kept at Home

It was during the American Revolution that Britain entered the Industrial Revolution. As this was not a very cooperative time between the Old World and the New World, America was not able to reap the benefits. This was largely due to the lack of manufacturing resources and the lack of experience needed to get the manufacturing world up and running.

Manufacturing was done in Britain and not encouraged in the colonies. This meant the right experts had to be found in Europe. Many wealthy individuals lured European experts to the new country to establish manufacturing and to encourage the economic growth and stability of America. The new country needed people. It found itself lacking “skilled civilian personnel and reliable bureaucratic structures.”

A Few Good Men

It came down to men such as Samuel Slater who had the skills to make his way to America and found wealth as he gave to America knowledge and skill. John Nickolson and James Davenport tried to personally make the economy strong. Though faced with financial failure, their attempts helped to push the economy forward. The truth was that individuals could do a lot but not enough to be successful on their own. They had to turn to the governments and seek help.

The establishment of manufacturing was important and huge but the largest was “a struggle for economic independence waged against the importation of British goods.” This stemmed from a fear of falling back into Britain’s grasp economically and for a desire to lift America up to be a strong economic play in the world. This led to various duties, tariffs, and political moves that began to fight against each other.


Government Help Was Needed

As the fledgling manufacturing world saw their growth hindered with foreign imports, the “American mechanics began to appeal to the states for protection.” Each state passed their own protection acts which ranged from extremely light to extremely heavy. Eventually, the mechanics looked to the new federal government to solve the problems with the inter-state commerce situation that was ready to boil over. As the new government was unsure of itself and trying to feel comfortable in these new political clothes, it tried to appease everyone and found very few happy as the “The first federal tariff was not very protective… [with] the actual tariff rates were lower than those of the Pennsylvania and Massachusetts legislation they replaced.”

All of this was driven by the many manufacturing societies that were created to protect the mechanics. In the end, the societies failed but helped to push the new country into the process of establishing a strong economy. As they failed, Alexander Hamilton began pushing for a fiscal system that was against the protective tariffs that were desired by many. He saw it as a conflict of interest for revenue tariffs and a problem for the portion of the economy that thrived off of the import/export business. There rose to the surface, the problem of balancing an economy internally and externally. Though all governments are faced with this, the difficulty is exemplified when that same country is trying to balance the political arena, too.


“Economic Growth and the Early Industrial Evolution.” U.S. History: Pre-Columbian to the New Millennium. Accessed January 29, 2012.

Peskin, Lawrence A. Manufacturing Revolution: The Intellectual Origins of Early American Industry. Baltimore: John Hopkins, 2003.

Adler, William D. and Andrew J. Polsky. 2010. "Building the New American Nation: Economic Development, Public Goods, and the Early U.S. Army." Political Science


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