United States Economy
Early settlers had a variety of reasons for seeking a new homeland.
The Pilgrims of Massachusetts were pious, self-disciplined English
people who wanted to escape religious persecution. Other colonies, such
as Virginia, were founded principally as business ventures. Often,
though, piety and profits went hand-in-hand.
England's success at colonizing what would
become the United States was due in large part to its use of charter
companies. Charter companies were groups of stockholders (usually
merchants and wealthy landowners) who sought personal economic gain and,
perhaps, wanted also to advance England's national goals. While the
private sector financed the companies, the King provided each project
with a charter or grant conferring economic rights as well as political
and judicial authority. The colonies generally did not show quick
profits, however, and the English investors often turned over their
colonial charters to the settlers. The political implications, although
not realized at the time, were enormous. The colonists were left to
build their own lives, their own communities, and their own economy --
in effect, to start constructing the rudiments of a new nation.
What early colonial prosperity there was
resulted from trapping and trading in furs. In addition, fishing was a
primary source of wealth in Massachusetts. But throughout the colonies,
people lived primarily on small farms and were self-sufficient. In the
few small cities and among the larger plantations of North Carolina,
South Carolina, and Virginia, some necessities and virtually all
luxuries were imported in return for tobacco, rice, and indigo (blue
dye) exports.
Supportive industries developed as the
colonies grew. A variety of specialized sawmills and gristmills
appeared. Colonists established shipyards to build fishing fleets and,
in time, trading vessels. The also built small iron forges. By the 18th
century, regional patterns of development had become clear: the New
England colonies relied on ship-building and sailing to generate wealth;
plantations (many using slave labor) in Maryland, Virginia, and the
Carolinas grew tobacco, rice, and indigo; and the middle colonies of New
York, Pennsylvania, New Jersey, and Delaware shipped general crops and
furs. Except for slaves, standards of living were generally high --
higher, in fact, than in England itself. Because English investors had
withdrawn, the field was open to entrepreneurs among the colonists.
By 1770, the North American colonies were
ready, both economically and politically, to become part of the emerging
self-government movement that had dominated English politics since the
time of James I (1603-1625). Disputes developed with England over
taxation and other matters; Americans hoped for a modification of
English taxes and regulations that would satisfy their demand for more
self-government. Few thought the mounting quarrel with the English
government would lead to all-out war against the British and to
independence for the colonies.
Like the English political turmoil of the
17th and 18th centuries, the American Revolution (1775-1783) was both
political and economic, bolstered by an emerging middle class with a
rallying cry of "unalienable rights to life, liberty, and
property" -- a phrase openly borrowed from English philosopher John
Locke's Second Treatise on Civil Government (1690). The war was
triggered by an event in April 1775. British soldiers, intending to
capture a colonial arms depot at Concord, Massachusetts, clashed with
colonial militiamen. Someone -- no one knows exactly who -- fired a
shot, and eight years of fighting began. While political separation from
England may not have been the majority of colonists' original goal,
independence and the creation of a new nation -- the United States --
was the ultimate result.
Source: U.S. Department of State
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