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The Articles of Confederation and Perpetual Union were the first constitution of the United States of America.[2] The problem with the United States government under the Articles of Confederation was, in the words of George Washington, "no money".[3]
Congress could print money, but by 1786, the money was useless. Congress could borrow money, but could not pay it back.[3] No state paid all of their U.S. taxes; Georgia paid nothing. Some few paid an amount equal to interest on the national debt owed to their citizens, but no more.[3] No interest was paid on debt owed foreign governments. By 1786, the United States would default on the dates the principal came due.[3]
The United States could not defend itself as an independent nation in the world of 1787. Most of the U.S. troops in the 625-man U.S. Army were deployed facing British forts on American soil. The troops had not been paid; some were deserting and the remainder threatened mutiny.[4] Spain closed New Orleans to American commerce. The United States protested, to no effect. The Barbary Pirates began seizing American commercial ships. The Treasury had no funds to pay the pirates' extortion demands. The Congress had no more credit if another military crisis had required action.[3]
The states were proving inadequate to the requirements of sovereignty in a confederation. Although the Treaty of Paris (1783) had been made between Great Britain and the United States with each state named individually, individual states violated it. New York and South Carolina repeatedly prosecuted Loyalists for wartime activity and redistributed their lands over the protests of both Great Britain and the Articles Congress.[3]
In Massachusetts during Shays' Rebellion, Congress had no money to support a constituent state, nor could Massachusetts pay for its own internal defense. General Benjamin Lincoln had to raise funds among Boston merchants to pay for a volunteer army.[5] During the upcoming Convention, James Madison angrily questioned whether the Articles of Confederation was a compact or even government. Connecticut paid nothing and "positively refused" to pay U.S. assessments for two years.[6] A rumor had it that a "seditious party" of New York legislators had opened communication with the Viceroy of Canada. To the south, the British were said to be funding the Creek Indian raids; Savannah was fortified, the State of Georgia under martial law.[7]
Congress was paralyzed. It could do nothing significant without nine states, and some legislative business required all thirteen. When only one member of a state was on the floor, then that state’s vote did not count. If a delegation were evenly divided, no vote counted towards the nine-count requirement.[8] Individual state legislatures independently laid embargoes, negotiated directly with foreigners, raised armies and made war, all violating the letter and the spirit of the “Articles of Confederation and Perpetual Union”. The Articles Congress had "virtually ceased trying to govern."[9] The vision of a "respectable nation" among nations seemed to be fading in the eyes of revolutionaries such as George Washington, Benjamin Franklin and Rufus King. The dream of a republic, a nation without hereditary rulers, with power derived from the people in frequent elections, was in doubt.[10]
