Changes

The new land that America had gained in the war was west of the Appalachian mountains.  Thus, the most efficient way to transport goods out of that land was via the Mississippi River.  But the Spanish claimed the territory west of the Mississippi and exclusive navigation of the river.  Spain knew that it was temporarily secure in this assertion, as the United States was too weak to fight for its territory.  Although John Jay attempted to negotiate, America had nothing to offer, and thus nothing changed.

The new land that America had gained in the war was west of the Appalachian mountains.  Thus, the most efficient way to transport goods out of that land was via the Mississippi River.  But the Spanish claimed the territory west of the Mississippi and exclusive navigation of the river.  Spain knew that it was temporarily secure in this assertion, as the United States was too weak to fight for its territory.  Although John Jay attempted to negotiate, America had nothing to offer, and thus nothing changed.

Across the sea in the Mediterranean, American trade was interrupted by piracy off of the Barbary Coast (modern day Tunisia).  Previously, America had been protected from the pirates by England, but now was obliged to pay its own way. But the government had no money to bribe or fight the pirates.

Across the sea in the Mediterranean, American trade was interrupted by piracy off of the Barbary Coast (modern day Tunisia).  Previously, America had been protected from the pirates by England, but now America was obliged to pay its own way. But the government had no money to bribe or fight the pirates.

From the beginning, the Confederation had financial troubles, and its attempts to correct its deficiencies only made its problems worse.  It attempts to gain money were uniformly unsound.  Congress borrowed money from foreign countries, printed paper currency, and sold undeveloped western lands.  None of these tactics were effective.

From the beginning, the Confederation also had financial troubles, and its attempts to correct its deficiencies only made its problems worse.  It attempts to gain money were uniformly unsound.  Congress borrowed money from foreign countries, printed paper currency, and sold undeveloped western lands.  None of these tactics were effective in improving the economy.

After the war, America had more that 35 million dollars in debt, and that number only continued to grow.  The money from the sale of western land was paltry.  It could have paid only one fourth of the government's current expenses.  There were no national taxes, and requests for money from the states were ignored.  The state governments were having financial difficulties of their own.   

After the [[Revolutionary War]], America had more that 35 million dollars in debt, and that number only continued to grow.  The money from the sale of western land was paltry.  It could have paid only one-fourth of the government's current expenses.  There were no national taxes, and requests for money from the states were ignored.  The state governments were having financial difficulties of their own.   

So Congress turned to paper money, and began to issue it in large amounts.  Sudden inflation gave a brief image of prosperity, but as quickly as the money had inflated, it became worthless and was abandoned.  People used European coins, made of gold or silver, as currency.  Since there was much less of this money than there had been of the printed money, rapid deflation occurred, causing a depression.

So Congress turned to paper money, and began to issue it in large amounts.  Sudden inflation gave a brief image of prosperity, but as quickly as the money had inflated, it became worthless and was abandoned.  People used European coins, made of gold or silver, as currency.  Since there was much less of this money than there had been of the printed money, rapid deflation occurred, causing a depression.