Economic History of the U. S. Econ 1740, Class Time Line. Part 1: The Colonial Era; 1607 – 1776

Alex Twede, Daniel Gandy, Mark Hansen

The development of “Western Culture,” has been unwittingly crafted via a collective dualism fathered in the passionate, individualistic tenets of the purveyors of the mystical and the material. Our civilization, even our nationalism, has developed and continues in refinement along those many paths traversed by the individual in his or her quest for religious freedom and/or unbounded wealth.

From the very founding of the English colonies in America in the early 1600’s, common paths were oft traveled, yet viewed from two holistically different perspectives, the bifurcation being manifest in the deep cultural splits separating the colonies to the North in New England and to the South in Virginia. 

Those in New England took the mystical or intensely Christian path; the early adventurers and enterprisers of Virginia took the more secular or materialist path.  This division would play a key role in how these and subsequent English colonies would develop – even from the outset in the early 1600s all the way up to today. These early distinctions in world view were simply reflections in those differences that brought English colonizers to America whether pursuant to the quest for wealth or for religious freedom.

There is no question that “the southern colony of Virginia was founded on the secular quest for wealth – and the aristocratic status that wealth brought an individual and his family.” And that “the northern colonies of New England were founded on the religious quest for the right to live as God directed – not as man, not even kings or bishops, directed.” 

Not only was America divided into two ideological encampments from the very outset of the colonization effort, this bifurcation would lead the country in the mid-1800s into the violent conflict we know as our civil war.  And this cultural divide, though no longer geographic, grips us even – and in particular – today. 

From our Text, HISTORY OF THE AMERICAN ECONOMY: Eleventh Edition by Gary M. Walton and Hugh Rockoff, we have come to rely on five “Economic Reasoning Propositions.” These propositions when viewed either singularly or in combination can be applied as the basic tenets that have directly or indirectly lead to the events, ideas and cultural happenings that have been highlighted within our included time line.

The five “Economic Reasoning Propositions” are summarized as follows:

1. Choices matter; people choose, and individual choices are the source of social outcomes.

2. Costs matter; choices impose costs.

3. Incentives matter, rewards encourage people to act.

4. Institutions matter and the “rules of the game” influence choices.

5. Evidence matters, understanding based on knowledge and evidence imparts value to opinions.

We hope that you find the events highlighted in our timeline as interesting as we have. Certainly the formation of our Nation has been dynamic and collectively unequalled in any other country on earth since the beginning of the Colonial Era and the first permanent settlement in Jamestown, Virginia in 1607.

1607

First Permanent British Settlement ►

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  On May 14, 1607, Jamestown became the first permanent British settlement in America. The British had attempted to colonize a few places in North America, but Jamestown was the first place to successfully be settled by the British and become a permanent settlement. The first contingency of settlers consisted of 105 men, and no women. Most of these earliest pioneers coming to Jamestown, all being poorly supplied and completely untrained in the mechanisms of colonization, suffered and typically died within the first two years of making landfall. Of the 6000 migrants that arrived between 1607 and 1623, 4800 of them expired. As for the living, it wasn’t long before they dismissed the quest for fast cash and settled into the pursuit of survival. Desperate to come up with good alternatives for gold and silver, tobacco eventually became the cash crop.
  

Frontier Women ►

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  The men of Jamestown had been there for over a year before the first English women arrived in the fall of 1608. By the end of following year there were about 100 women living in Jamestown. Another two years would pass before a significant number of women would join the ranks of Jamestown.
  

FOR SALE: cheap to a good home! ►

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  In the early years of the colony it was a chartered enterprise that functioned as a common stock business entity. The settlers were given “planter shares” for land as a form of common stock ownership – a means of investing in the company with the promise of landholdings to be paid in five years’ time. Because the venture failed financially, land ownership as promised was also slow in coming. Although some efforts had been made to get small parcels of land transferred to the colonists for private ownership the first real step was finally taken in 1614 when ownership of up to three acres was authorized.
  

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  In 1614 John Rolfe marries Pocahontas and successfully cross-pollinates Indian tobacco with seeds from England. This results in a sweeter tobacco that more fully suits the tastes of the Europeans and he begins shipments to England.
  

Tobacco Exports ►

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  Virginia colonists accomplish the first significant export of tobacco to England with a 2,300 pound shipment. During 1617 tobacco production reaches 18,839 pounds for export to England. Of the 2,000 settlers who have arrived in Jamestown, only 400 are still alive and of these, only 200 are trained or fit enough to farm.
  

The Headright System ►

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  In 1618, the headright system gave whoever paid their own way to Virginia 50 acres of land and another 50 acres for each person they paid to bring with them. This was done to try and solve the labor shortage by getting more people to come to Virginia.
  

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  In 1618 Tobacco is now the emergent cash crop; colonists ship 49,528 pounds of the leafy gold to England.
  

Africans in a New World ►

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  In 1619 roughly 20 Africans were brought from Angola to Jamestown colony. They came as indentured servants to work in the plantations much like the whites that were arriving from Scotland, Germany, Ireland and England. Committed to labor for a number of years to pay for their passage to America, they were freed to work for themselves after their debt was paid. But as time progressed, there became a scarcity of land that was available to those completing their period of servitude. This inability to have land ownership and prosperity caused many to stay on with their Virginia ‘masters’ becoming servants.
  

The Dutch Arrive ►

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  In the early 1600s, the Dutch West India Company had claimed part of the land in the New England area. They made these claims to secure fur trades with the Indians, and also hoping to find a water route that would lead to the Pacific. In 1609, the Company commissioned an English sea captain named Henry Hudson to explore the area to find the water route. Hudson discovered the large bay in Manhattan and the wide North river, which flowed into the bay. Soon after Hudson’s voyage, the Dutch explored the region. In November of 1620, the Dutch arrived in the area. In 1625, the Dutch’s first settlement was along the North River. In 1625, the island of Manhattan became the capital of the Dutch American province, which they called New Amsterdam.
  

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  In 1620, a group of Puritan colonists who were fleeing religious persecutions founded the Plymouth Colony in New Plymouth, Massachusetts. These people wanted to find a place where they could worship freely in the way they wanted. When the Plymouth colonists came over, they came over as families, so the Colony had men, women, and children living there. The Colony’s social and legal systems became closely tied to religious beliefs and English custom. Plymouth was the first sizable permanent English settlement in the New England region, which in 1691 formed the Province of Massachusetts Bay with a few other colonies and territories.
  

Virginia Becomes a Crown Colony ►

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  In 1624, because of Indian problems, Argall’s behavior, and the rumors hurting the recruitment of settlers, the Virginia Company lost its charter as a commercial company. In May of 1625 Virginia was turned into a Crown colony. This made it so the Crown, which is represented by a governor, controls Virginia’s legislature and administration. Virginia was reorganized into counties and towns, and the House of Burgesses’ power was reduced a bit. Even with all this, the major plantations still dominated Virginia’s local politics with the Governor’s Council being made up of people who were heads of the largest plantations.
  

Ship building ►

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  Although large-scale manufacturing was not the normal colonial economic activity, the Dutch were busy building ships and by 1631 they had produced their first 30 ton sloop. For a brief period the Dutch dominated the industry and had captured most of the market for shipping American made products.
  

Navigation Act(s) ►

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  The first of the so called “Navigation Acts” passed by the English Parliament was directed at prohibiting the use of Dutch built vessels for the shipping of American products. Although this initial act was put in place, it was not readily enforced until the Navigation Acts of 1660 and 1663 when England was in a better position to enforce the laws. In brief the laws stipulated that shipping had to be accomplished with English owned vessels, foreign merchants could not deal directly with the colonies and that certain commodities produced in America could only be shipped to England or designated ports.
  

Show me the Money! ►

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  Massachusetts was the first colony to mint coins of low bullion content in 1652. In 1690 they were the first to issue paper money as a means of paying soldiers, providing them with bills of credit. Wampum had been circulated in the Massachusetts area prior to this time as legal tender for private debts, in New York it was used as money as late as 1701. Commodity money – well let’s just say only worth “beans.”
  

British Takeover of New York ►

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  On August 18, 1664 the British began to take over the Dutch colony. On August 27, 1664 the British took over the Dutch colony, and there was no bloodshed. The fort there was renamed Fort James in honor of James II of England. New Amsterdam was renamed New York in recognition of James’s title as Duke of York. In August of 1673, the Dutch brought a fleet of 21 ships and recaptured Manhattan. The fort was renamed Fort Willem Hendrick in honor of the Dutch leader and New York was renamed New Orange. But in 1674 the British took back Manhattan in the Treaty of Westminster, and renamed it back to New York. New York became a very useful area for doing trade for the British.
  

Hudson Bay Company ►

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  On May 2, 1670 English royal charters founded the Hudson Bay Company. King Charles granted a charter to his cousin Prince Rupert and his associates. The Hudson Bay Company was created as a corporate entity. Several supplementary charters that modified the original one have been granted since, most recently in 1970. This company handled trade and is still in operation today. It is the oldest commercial corporation in North America. The Hudson Bay Company’s full name is the Governor and Company of Adventurers of England trading into Hudson’s Bay.
  

Pass the Rice! ►

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  Around 1695 the second of the great southern staples was introduced. At first cultivated in the inland swamps that could be flooded from the rivers prior to the adoption of water control techniques developed by the Dutch, using tidal flow as a means of flooding lowlands along coastal marshes.
  

Duplication Production Law ►

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  In an attempt to increase taxation and control over colonial production and trade of wool, British parliament made it illegal to export colonial wool, wool yarn and finished wool products to any foreign country or to other colonies.
  

Of Pirates and Privateers – “Avast ye bilge rats!” ►

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  Local traders, shippers, and government officials in the Carolinas repeatedly solicited the Board of Trade for protection from an overabundance of nefarious outlaws roaming the high seas. Many of the pirates lurked in the safety of the North Carolina coastal inlets and regularly raided vessels trading in Charleston. Out of desperation, in 1719, Carolina’s Assembly provided funding for private vessels to go after and drive off the pirates. (like sending the chickens to get rid of the fox- just a calculated waste of time and resources) Finally, when the cost of providing safe passage was greater than the cost of getting rid of the picaroons, the Royal Navy took action and by the early 1740’s piracy had been eliminated from the western Atlantic.
  
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    Pirate: One who robs at sea or plunders the land from the sea without commission from a sovereign nation; the opposite of a privateer.
    
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    Privateer: A sailor with a letter of marque from a government. Technically a privateer was a self-employed soldier paid only by what he plundered from an enemy. In this, a privateer was supposed to be above being tried for piracy. A privateer is theoretically a law-abiding combatant, and entitled to be treated as an honourable prisoner if captured. Most often, privateers were a higher class of criminal, though many became pirates.
    

Georgia Is Settled ►

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  James Oglethorpe founded Georgia as a trustee colony in 1732. On February 12, 1733 Georgia became a settlement. In 1730, Oglethorpe and a group of associates who had previously served with him on a prison reform committee, petitioned to form the Trustees for the Establishment of the Colony of Georgia in America. The petition was approved in 1732 and in November the first group left with Oglethorpe to go to the New World. England sent their debtors in prison to Georgia to have a chance to start a new life. England also used Georgia as a barrier to stop the Spanish expansion of Florida. Interestingly, in 1735, Oglethorpe and the Trustees convinced the British House of Commons to pass an act banning slavery in the new colony, which was overturned by a new act in 1750. After that, slavery grew there as labor for the coastal rice plantations.
  

Molasses Act ►

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  Act of British parliament which imposed a tax of six pence per gallon on importation of molasses from non-British colonies.
  

Indigo ►

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  The indigo plant was first introduced by Eliza Lucas in 1743. Although it was somewhat difficult to grow, it proved to be an ideal crop in that it grew in the higher ground that was not suited for cultivating rice and was seasonally opposite the cultivation and harvest of rice.
  

Currency Act(s) ►

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  Passed in an effort to deal with the fluctuating value of colonial money. Limited to the New England colonies, the purpose was to limit Bills of Credit to 2 years of life, mitigating the problem of over-issuance and limiting their use to the payment of public debt and taxes. The Currency Act of 1764 extended the original provisions to all of the colonies and gave Parliament exclusive power over the American money supply. It was supported by British merchants and provided the means to gradually eliminate Bills of Credit.
  

French and Indian War ►

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  On May 17, 1756 Britain and France declared war on each other. A dispute turned into violence in the Battle of Jumonville Glen in May of 1754, during which George Washington who at this time was 22 years old command Virginia militiamen to ambush a French patrol. The war lasted seven years and was fought in North America. The British won this war in the end, which gave them more colonial power in the New World.
  

Treaty of Paris: Conclusion of the Seven Years’ war. ►

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  English forces became victorious over the French armies in defense of the American colonies. The treaty of Paris was signed on February 10, 1763 to end the French and Indian War. This treaty made it so only Spain and England had possession of the North American continent. Spain owned the territory west of the Mississippi and England had everything east with some exceptions of some fishing rights and some small islands near Newfoundland. Also according to the treaty, England obtained all of Florida.
  

Sugar Act ►

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  Also known as the American Revenue Act, this act was a created to take place of the Molasses act of 1733 due to the inefficiency of collection; this reduced the tax by half in hopes that the revenue of the tax would actually be collected.this act cut halved the previous tax on molasses, but further enforced, was believed to generate larger revenue.
  

Stamp Act ►

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  This was a direct tax from British parliament that required printed materials, like legal documents, magazines, newspapers, and various other printed materials, in the colonies are to be printed using “stamped paper”. The purpose of this act was raise revenue and to pay for the troops that were stationed in North America after the British victory in the Seven Years’ war.
  

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  Held in New York City between representatives from the colonies to plan and devise a united protest against the latest taxation from British parliament. Congress passed resolutions of fealty, and organized a boycott of English goods; also established “nonimportation associations” in the colonies.
  

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  As an amendment to the mutiny act, this act from British Parliament enacted that American Colonies are to provide barracks, some moderate provisions, and part of the cost for the military transport of British troops within the colonies.
  

Declaratory act ►

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  This act from British parliament repealed the Stamp Act due to the damage it was causing to British trade; the major part of this act affirmed the right of parliament to legislate in all matters in the colonies stated by “had hath, and of right out to have full power and authority to make laws and statutes of sufficient force and validity to bind the colonies and people of America…in all cases whatsoever.”
  

Townsend act ►

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  This act by British Parliament was created to create effective means of enforcing the compliance of trade regulations and, to set a precedent that British Parliament had the right to tax. This act replaced the Stamp Act with the idea that the colonists would accept this because it wasn’t a direct tax.
  

Boston massacre ►

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  British soldiers who were surrounded by American colonists and were subject to verbal abuse, threats, and thrown objects - without order, fired into the crowd killing five civilians and injuring six others.
  

Tea Act ►

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  The Tea Act allowed the East India Company to ship tea to the colonies and sell directly to the colonists – providing Britain with a sales tax collection on all tea purchases. Even though the price of tea was reduced, and the East India Company was saved from bankruptcy, the act created a tea monopoly in the American colonies, eliminating the ability of the middlemen to compete for business. Of course the smugglers of Dutch tea were the most distraught – patrons of the black market tea lost their supply lines and were obliged to pay the tax levied on the East India tea.
  

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  December 16, 1773; more than 5,000 people gathered for a meeting and to protest the Tea Act. 116 of the Sons of Liberty disguised themselves as Indians and dumped an entire shipment of 90,000 pounds of tea into the Boston harbor, destroying the tea. 45 tons of tea in 342 containers quietly thrown overboard at an estimated worth of $1 million dollars in today’s dollars, it was another month before news of the party reached England – they were not amused!
  

Coercive acts ►

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  Also known as the “Intolerable Acts” by American patriots were a series of laws by British Parliament that closed the port of Boston to all shipping until the cost of the Boston Tea party was repaid to the East India Company. This was a blatant move by Britain to punish Boston for destruction of private property and to restore ultimate British authority is Massachusetts, all a very visible way of reforming the colonial American government.
  
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    Boston Port Act: The first of the acts passed as punishment, closed the port of Boston until the East India Company was compensated for its loss and the King was satisfied that he had gotten his point across. Of course why prosecute the perpetrators when punitive damage can be inflicted on the innocent masses without the need for a messy trial.
    
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    Massachusetts Government Act: Unilaterally revised the charter of Massachusetts to make certain cherished rights dependent on the arbitrary decision of the Crown appointed governor or the King himself. The right to public meeting was restricted to once a year unless called for by whim of the Governor. All colonial eyes were on what was happening in Massachusetts, fearful that their local governments were next to fall.
    
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    Administration of Justice Act: Called the “Murder Act” by George Washington, permitted British officials charged with crimes committed in an American colony while enforcing British laws to be tried in another colony or in Great Britain under the guise that a fair trial was not possible in Massachusetts.
    
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    Quartering Act: Applied to all of the colonies as a way to force the housing of British troops upon the locals where ever the troops were stationed.
    
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    The Quebec Act: Though it was not a directly related to the events at Boston it was still regarded as being an Act of Coercion. It enlarged the boundaries of what was the British Province of Quebec south to the Ohio River and west to the Mississippi and gave special consideration to the French Catholics of the region. The Patriots of Massachusetts saw this a violation of their rights and took action by forming the First Continental Congress as a means of coordinating their subsequent protests.
    

Continental Congress ►

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  This was a convention of delegates from the American colonies called in response to the Coercive Acts. They compiled a list of grievances for the king that included:
  
  1. 
     Taxes had been imposed upon the colonies by the British parliament.
     
  2. 
     Parliament had claimed the right to legislate for the colonies
     
  3. 
     Commissioners were set up in the colonies to collect taxes
     
  4. 
     Admiralty court jurisdictions had been extended into the interior.
     
  5. 
     Judges’ tenures had been put at the pleasure of the crown.
     
  6. 
     A standing harm had been imposed upon the colonies.
     
  7. 
     Persons could be transported out of the colonies for trials.
     
  8. 
     The port of Boston had been closed.
     
  9. 
     Martial law had been imposed upon Boston.
     
  10. 
      The Quebec Act had confiscated the colonists’ western lands.
      

States of Rebellion ►

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  February 1775: Massachusetts declared to be in a state of rebellion. In late 1774 the Suffolk Resolves were formed to resist the enforcement of changes made to the Massachusetts colonial government by the British parliament as response to the Boston Tea Party. An illegal Patriot shadow government known as the Massachusetts Provincial Congress was subsequently formed and began to train militia for possible hostilities. The rebel government exercised effective control of the colony outside of British-controlled Boston and in response, Massachusetts was declared to be in a state of rebellion. About 700 British Army regulars in Boston, under Lieutenant Colonel Francis Smith, were given secret orders to capture and destroy rebel military supplies that were reportedly stored by the Massachusetts militia at Concord.
  

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  April 19, 1775: The Battles of Lexington and Concord were the first military engagements of the American Revolutionary War. Fought in Middlesex County, Province of Massachusetts Bay, within the towns of Lexington, Concord, Lincoln, Menotomy (present-day Arlington), and Cambridge, near Boston. The battles marked the outbreak of open armed conflict between the Kingdom of Great Britain and its thirteen colonies in British North America.
  

IN CONGRESS, July 4, 1776. ►

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  The unanimous Declaration of the thirteen united States of America,
  

We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.--That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed, --That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness. Prudence, indeed, will dictate that Governments long established should not be changed for light and transient causes; and accordingly all experience hath shewn, that mankind are more disposed to suffer, while evils are sufferable, than to right themselves by abolishing the forms to which they are accustomed. But when a long train of abuses and usurpations, pursuing invariably the same Object evinces a design to reduce them under absolute Despotism, it is their right, it is their duty, to throw off such Government, and to provide new Guards for their future security.--Such has been the patient sufferance of these Colonies; and such is now the necessity which constrains them to alter their former Systems of Government. The history of the present King of Great Britain is a history of repeated injuries and usurpations, all having in direct object the establishment of an absolute Tyranny over these States. To prove this, let Facts be submitted to a candid world.

In every stage of these Oppressions We have Petitioned for Redress in the most humble terms: Our repeated Petitions have been answered only by repeated injury. A Prince whose character is thus marked by every act which may define a Tyrant, is unfit to be the ruler of a free people.

Nor have We been wanting in attentions to our Brittish brethren. We have warned them from time to time of attempts by their legislature to extend an unwarrantable jurisdiction over us. We have reminded them of the circumstances of our emigration and settlement here. We have appealed to their native justice and magnanimity, and we have conjured them by the ties of our common kindred to disavow these usurpations, which, would inevitably interrupt our connections and correspondence. They too have been deaf to the voice of justice and of consanguinity. We must, therefore, acquiesce in the necessity, which denounces our Separation, and hold them, as we hold the rest of mankind, Enemies in War, in Peace Friends.

We, therefore, the Representatives of the united States of America, in General Congress, Assembled, appealing to the Supreme Judge of the world for the rectitude of our intentions, do, in the Name, and by Authority of the good People of these Colonies, solemnly publish and declare, That these United Colonies are, and of Right ought to be Free and Independent States; that they are Absolved from all Allegiance to the British Crown, and that all political connection between them and the State of Great Britain, is and ought to be totally dissolved; and that as Free and Independent States, they have full Power to levy War, conclude Peace, contract Alliances, establish Commerce, and to do all other Acts and Things which Independent States may of right do. And for the support of this Declaration, with a firm reliance on the protection of divine Providence, we mutually pledge to each other our Lives, our Fortunes and our sacred Honor.