KEY FORCES IN AMERICAN HISTORY
1. A key to understanding people’s behavior is figuring out the incentives they face.
2. Economic freedom, rule of law, and well-defined property rights promote growth and prosperity.
4. Wars harm economies and people.
ECONOMIC CONCEPTS that support the historical analysis:
Expected benefit and expected cost
History Standards (from National Standards for History by the National Center for History in the Schools)
Era 3 – 3: The student understands the institutions and practices of government created during the Revolution and how they were revised between 1787 and 1815 to create the foundation of the American political system based on the U.S. Constitution and the Bill of Rights
Era 4 – 1: The student understands United States territorial expansion between 1801 and 1861, and how it affected relations with external powers and Native Americans
Era 4 – 2: The student understands how the industrial revolution, increasing immigration, the rapid expansion of slavery, and the westward movement changed the lives of Americans and led toward regional tensions
Economics Standards (from Voluntary National Content Standards in Economics)
Standard 3: Different methods can be used to allocate goods and services. People, acting individually or collectively through government, must choose which methods to use to allocate different kinds of goods and services.
Standard 4: People respond predictably to positive and negative incentives.
Standard 5: Voluntary exchange occurs only when all participating parties expect to gain. This is true for trade among individuals or organizations within a nation, and among individuals or organizations in different nations.
Standard 10: Institutions evolve in market economies to help individuals and groups accomplish their goals. Banks, labor unions, corporations, legal systems, and not-for-profit organizations are examples of important institutions. A different kind of institution, clearly defined and enforced property rights, is essential to a market economy.
- 1785 & 1787 Land Ordinances sought to achieve several goals: generate federal revenue from land sales; encourage settlement; spread democratic institutions; set out clear property rights; create incentives for property-owners to improve land
- The system of property rights established with land ordinances and included in U.S. Constitution ensure that property owners own land in perpetuity, can sell or bequeath it. This system creates an incentive to invest in land improvements.
- Because this is the only property rights system most students have ever known, one teaching tactic is to contrast the American property rights system with other systems. Possibilities include American Indians (before or after forced removal to reservations), and Spanish colonies of Latin America.
- Before removal, property was generally owned communally by the tribe. Individuals did not own their own property. This pattern was initially continued after removal to U.S. reservations. The Dawes Act of 1887 provided 160 acres for each registered American Indian, to be held as individual private property (though it could not be sold for 25 years). Some argue this system was to create incentives to improve the land. Others counter the system was designed to ultimately facilitate transfer of land to whites.
- Federal land acts of the late 18th and early 19th centuries sought to achieve two sometimes contradictory goals: encourage settlement and enhance federal revenues. The resulting tension between affordability and enhancing revenue led to over a half-century of adjustments to land policy.
- The Western Frontier shifted rapidly westward between 1800 and 1860 as the population moved from the east to the west, and as European immigrants moved to America. In 1810, only 15 percent of the U.S. population resided west of the Appalachians; by 1860, nearly 50% did. The political interests of independent family farmers in the West ultimately came into conflict with those of slave-owners in the South.
- Encroachment of Americans onto traditional Indian lands led ultimately to a federal policy of removal. Forced migration of American Indians from the southeast to newly established Indian land in what is now Oklahoma occurred in the 1830s. Rapid expansion of slave-based cotton agriculture into the fertile lands of the Alluvial region followed.