Topic: EconomicsCurrency

Last updated: April 27, 2019

The Articles of Confederation was America’s first constitution. It was adopted in 1777 by congress because there was a need for unity among the new states that were created as a result of the American Revolution. It put the largest share of power to the individual thirteen states in which each of them held “its sovereignty, freedom, and independence.” Though the Articles of Confederation was made to create a “firm league of friendship” between and among the 13 states, there were a lot of reasons why it didn’t fulfill this and initially failed.

One of the biggest mistakes that the Articles of Confederation brought about that led to its failure was that it placed power in the hands of the states. The reason why the founding fathers did this was because colonists were wary of a strong central government due to the way they had to deal with the British crown. Under the Articles of Confederation, Congress would make decisions, but they had no power to enforce it since the states had the final decision. This made governing the states ineffective because a lack of central government. From the absence of a powerful, national government emerged a series of limitations that made the Articles of Confederation futile.

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Another crucial reason why the Articles of Confederation failed was because the National Government relied heavily on states to fund financial resources. Only the states, not Congress, had the authority to impose taxes and raise revenue; that means that Congress had to request for funds from the states. Unfortunately, this money was oftentimes not raised by the states or given to the national government long after it was due.

Without the money they needed from the states, Congress was left unable to pay America’s debts and fulfill other tasks. The Articles of Confederation plunged the National Government into a financial crisis and left a disorganized economy that lacked the ability to pay for itself.The Articles of Confederation failed for many reasons, and one of those reasons is that each state had its own currency. America had no set up system of currency. All the states could print out their own form of currency.

This made it very difficult to trade between states and foreign countries very difficult and less efficient. And to top everything else off when Congress would try to fix this they were denied the power, under the Articles of Confederation, to regulate trade. Many countries didn’t take The United States seriously because of their unorganized trading system. All of these elements affected their economy and made people see that the Articles of Confederation wasn’t working.In conclusion, the Articles of Confederation was America’s constitution and the beginning of a new era.

It was made to set out the new country’s form of government, but it had many problems that led to its failure, and initially it being thrown out. The Articles of Confederation was very weak and lacked many things like central government, sufficient funds, and a stable trading system along with a main currency, and many more. This paved way for the formation of a new Constitution, which rectified all the flaws and mistakes in the Articles of Confederation.


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