Home in the Woods. By: Thomas Cole.

The economy of the early United States would be familiar to modern Americans in some respects but also hard to recognize, given the development of the American economy in the past two centuries.

America, by 1815, had a “high birthrate, rapid population growth, most people being in the agricultural sector, and surplus rural population migrating in quest of a livelihood.” Daniel Walker Howe, What Hath God Wrought: The Transformation of America 1815-1848, 43. Comparatively speaking, communication was slow, diseases ran rampant, education was secondary to farming life, and many of the manufactured goods that were necessary for life were imported in exchange for raw materials, “like timber, tar, and fur.” Id.

As Daniel Walker Howe explained in What Hath God Wrought, the United States in 1815 faced a number of issues: “how to attract or mobilize investment capital; how to provide municipal services (police, water, fire protection, public health) for the suddenly growing cities; how to create and fund a system of public education capable of delivering mass literacy; how to combine industrialization with decent labor conditions and hours of employment; how to arbitrate disputes between indigenous peoples and white settlers intent on expropriating them.” Id.

By this time, the American economy was dependent on importing a number of goods, not just manufactured. For example, Americans were importing “textiles of wool, linen, and silk, . . . wine, gin, brandy, and rum, . . . household hardware, cutlery, firearms, tools, and the aptly named China-ware.” Id. at 46 citing T. H. Breen, The Marketplace of Revolution: How Consumer Politics Shaped American Independence (New York, 2004).

The colonial American economy had been one of the pillars of the British economy, which had been deemed by some to be “an empire of goods.” Id. Americans had built trade routes all around the world, and by 1815, those trade routes had made Americans a seafaring people, with trade operating in Europe, China, around Africa, and elsewhere. Id. at 47.

By 1815, the American economy had carved out a niche for itself in the world, even though it lacked the influence and prestige that it would later gain as an economic power. The earliest Americans were effective at trading around the world the raw materials that were available in the United States for those items that were necessary for life and could not be easily manufactured or otherwise obtained in America.

In many ways, the early American economy had all of the hallmarks of a developing nation. It was both enjoying growth and commerce while struggling to support its population with the infrastructure and necessities that the people craved. At the beginning of the first generation after the Founding Fathers, the seeds were planted for the American economy to build steam while also dealing with building the fundamentals of a society that could care for its citizens.