The Revolutionary War had secured independence, but it also left the United States buried under enormous debt.

Years of fighting against Britain had been extraordinarily expensive.

Congress borrowed heavily from foreign governments and private lenders to finance the war effort. States accumulated large debts of their own while trying to supply soldiers, weapons, food, and military equipment.

By the 1780s, both the national government and the individual states faced severe financial strain.

The situation exposed the weaknesses of the Confederation government immediately.

Under the Articles of Confederation, Congress lacked the authority to levy direct taxes. It could request money from the states, but it could not compel payment.

Many states either delayed contributions or refused them entirely.

Without stable revenue, the national government struggled to pay war debts, compensate soldiers, or maintain even basic operations.

Economic instability spread throughout the country.

During and after the war, large amounts of paper currency had been printed to finance military expenses. Much of the currency rapidly lost value, contributing to inflation and public distrust of money issued by the government.

The phrase “not worth a Continental” became a common expression describing worthless paper currency.

Farmers faced especially difficult conditions.

Many had borrowed money during the war and now struggled to repay debts amid falling crop prices and unstable markets. State governments, desperate for revenue, imposed heavy taxes that often had to be paid in hard currency rather than paper money.

For struggling farmers, obtaining hard currency proved extremely difficult.

Merchants and creditors demanded repayment, courts ordered property seizures, and debtors risked losing farms, livestock, and homes if they failed to meet financial obligations.

Economic hardship created growing anger toward political leaders.

Many ordinary Americans believed the government had abandoned the people who had sacrificed most during the Revolution. Former soldiers complained they had fought for liberty only to face poverty and debt afterward.

Regional tensions worsened the crisis.

Commercial states focused heavily on trade and repayment of financial obligations, while many rural communities demanded debt relief and economic reforms. Political disagreements increasingly reflected divisions between creditors and debtors, merchants and farmers, coastal elites and frontier settlers.

The weak Confederation government seemed unable to respond effectively.

Congress possessed neither the money nor the authority necessary to stabilize the economy on a national level. Interstate trade disputes, conflicting currency systems, and inconsistent tax policies further complicated recovery.

Foreign governments watched the instability closely.

European powers questioned whether the United States could survive financially or politically as a unified republic. Some believed the American experiment in self-government might collapse entirely under the pressure of debt and disorder.

For many American leaders, the economic crisis carried dangerous political implications.

If the government could not maintain financial stability, enforce laws, or preserve public confidence, the republic itself might eventually fail.

The Revolution had won independence.

Now Americans faced the far more difficult challenge of building a nation capable of surviving peace.