US History - unit idgaf atp (market economy)

Market Economy

The economic system in the early-mid 1800s

• Shipping - faster, further, cheaper, and more available

• Production - more products and switched from

• Availability of goods - available in more areas

• Resources - still used water, wood, and animals (don’t change)

Embargo Act and War of 1812

Two events that caused the Market Economy to develop

• both prevented trading raw materials for finished goods

• had to switch to a market economy

Boosters of the American Economy

• Cotton Gin - Eli Whitney

• Steamboats - Robert Fulton

• Textile/Lowell Mills

• Railroads, Canals, roads

• American System (R.I.P)

Outcome of the Transportation Revolution

• Migration - increased to the west

• Economic growth - expanded

• National Road & Erie Canal - connected western markets to the east

• Cities - expanded and more were built

• Shipping costs/Travel time - is cheaper and travel time is cut in half

Impact of Cotton Gin

• Cotton production increases (50x more)

• Slave population increases (4x in 70 years)

• Northern businesses grew

Gibons v. Ogden Ruling

Interstate Navigation is interestate commerce and therefore a federal power

• NY can’t make laws surrounding it

McCulloch v. Maryland

Maryland can’t tax the national bank as it is unconstitutional

• Federal government is constitutional in creating a national bank under the Neccesary and Proper Clause

Signifigance of two SCOTUS cases

The two cases are in favor of the federal government which promotes nationalism and commerce

Factors threatening nationalism

• Protective Tarrifs

• Uneven distrubtion of railroads & wealth

• Development of different types of economies

Panic of 1819

• Boom economy before the panic (profitable)

• 1/3 of people lost jobs, savings, and/or property

• Land values dropped by ½

• No single cause of the panic

Lowell Mills

• Competition to British textile mills

• Innovation - loom and sewing machines

• Employed young unmarried women

  • paid less

  • easier to control

  • skilled in sewing

Lowell Mills system

Protected girls and kept their purity - allowed them to work away from home

• Strict system & rules

• no outsiders in the boarding houses

• church services

• no misconduct

• clean up snow immediately after snowfall

• provided vaccinations

• separate rooms for the sick

• bells for work and meal times

• had “den mothers” or female overseers

• can’t be out past ten, etc

Irish and Germans

Two largest groups of immigrates to America in 19th Century

South - Economy

Centered on Cash crops (agriculture)

• slave labor

• plantations

• cotton gin

West - Economy

Centered on food crops (agriculture)

• strong business relations with the East (grain)

• did not need slavery due to inventions

• McCormac Reaper

• Steel plow - John Deere

North - Economy

Centered on manufacturing

• textile mills

• Dominant in the clothing industry

• Sewing machines

• factory towns

• Gun factories

• Vital in sustaining the Civil war

Protective Tarrif

One aspect of the American system + results

• promoted domestic trade/US industry

• increase in the manufacturing sector

Renewal of National Bank

One aspect of the American system + results

• Create trust/stability in economy

• stable currency promotes trade

Improve Transportation

One aspect of the American system + results

• shipping goods are cheaper, faster, farther

• deploy military easier

Purpose of the American System

Promote, unify, and strengthen US economy

N v S - farm size and crop

North

• small - food crops

South

• big plantations - cash crops

N v S - transportation (railroads)

North

• more (transportation)

South

• less

N v S - type of economy

North

• Manufacturing

South

• Agriculture

N v S - Concentration of wealth

North

• more (wealthy merchants)

South

• less