Regional v National Interests (College Board AP® US History): Study Guide
Timeline & Summary
In the early 19th century, the United States was transitioning from its revolutionary roots into a developing nation with growing internal and external pressures. The country faced challenges in balancing its regional interests while fostering national unity. The War of 1812 exposed national economic instability and highlighted disagreements about the federal government’s role in regional economics. The war revealed significant weaknesses in the nation’s infrastructure, financial systems, and capacity to respond to crises.
American economic system
After the War
Expenses from the War of 1812 meant that the U.S. government required a reliable source of credit when it needed funds
By the end of the war:
There had been no national bank for four years
The U.S. was heavily in debt
This led to economic instability
The Charter for the First Bank of the United States ended in 1811
This left the government struggling to finance the war
There was insufficient money to improve infrastructure and roadway systems
This meant they could not support the movement of men and supplies during the war
To stabilize the economy and regulate currency, Congress approved a charter for the Second Bank of the United States in 1816
American System
In a speech in January 1816, Henry Clay proposed an economic system to stabilize the nation after the War of 1812
Clay called it the American System, and it had three distinct parts:
Federal funds
Tariffs
National bank
Federal funds
Federal funds were for:
internal improvements to connect centers of business to the frontier
building roads and canals like the Erie Canal and the National Road
repairing existing roads
Tariffs
The Tariff of 1816 was the first protective tariff Congress approved for imported goods
The Tariff of 1816 covered:
goods already produced in the United States (such as glass, carriages, and paper)
new industries in the United States (such as the production of axes, nails, and buttons)
luxury goods that were not produced in the United States
The national bank
A national bank, the Second Bank of the United States (1816-1836)
The bank:
stabilized the economy by regulating currency and credit
managed federal funds
provided loans to businesses to promote economic development
Opposition to the American System
Opponents of the American System believed that national funds should not be used to pay for regional expenses and development
Southern states felt the American System favored Northern industries instead of the South’s more agricultural economy
Historians believe the American System helped deepen the regional and sectional divisions that ultimately led to the Civil War
Examiner Tips and Tricks
It can be helpful to write out a timeline before writing essays or answering questions to help support your argument and show cause-and-effect relationships between each event.
Unlock more, it's free!
Did this page help you?
