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President James Monroe's Domestic Policy

Instructor: Nate Sullivan

Nate Sullivan holds a M.A. in History and a M.Ed. He is an adjunct history professor, middle school history teacher, and freelance writer.

In this lesson we will learn about the domestic policy of President James Monroe. We will highlight the key themes and developments surrounding the Monroe Administration, including politics during the Era of Good Feelings, the Missouri Compromise, and the Panic of 1819.

President James Monroe: Last of the Founding Fathers

Sometimes James Monroe gets overlooked among the other Founding Fathers like George Washington, John Adams, and Thomas Jefferson. Many of us probably associate him with the foreign policy bearing his name, the ''Monroe Doctrine''. But how much do most of us really know about what happened in the U.S. while he was president? It almost seems like there is a void.

James Monroe was the last president of a group of men considered America's ''Founding Fathers''. He was wounded in the Revolutionary War, studied law under Thomas Jefferson, served in the Continental Congress, and held the positions of Secretary of War and Secretary of State under President James Madison. But we want to focus in this lesson on his domestic policy. Let's dig deeper and explore what happened in the U.S. while he was president.

James Monroe was the 5th President of the United States and the last among the Founding Fathers.
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The Era of Good Feelings

James Monroe served as president from 1817-1825. He belonged to the Democratic-Republican Party, the party founded by Thomas Jefferson. Under Monroe, the Federalist Party was in decline and the Democratic-Republican Party found itself almost unopposed. Of course, political differences still existed, but President Monroe worked hard to downplay partisan politics and instead he focused on national unity. On top of this, the War of 1812 had ended just a few years before and American nationalism ran high. These factors resulted in a period of time that has been called the ''Era of Good Feelings''. During this time, America was relatively unified and political squabbling was at an all-time low. The future seemed bright and Monroe enjoyed much popularity. Most historians place the dates of the Era of Good Feelings to coincide with Monroe's presidency: 1817-1825.

The Missouri Compromise

There was one issue, however, that posed a problem for President Monroe and threatened to undo the Era of Good Feelings: that was slavery. The North consisted of free states where slavery had been banned. In the South, however, slavery was legal and many Southerners considered it an essential component of the Southern economy. In 1820, the U.S. consisted of 11 free states in the North and 11 slave states in the South. When Missouri petitioned for statehood, this presented a major problem. Would it be a free or slave state? Whichever side it entered, it would upset the balance of power between the number of free and slave states.

After intense dispute and negotiating in Congress, a compromise was reached. The Missouri Compromise provided for Missouri to be admitted as a slave state, but Maine would also come into the Union as a state, a free state. This would ensure there were 12 free states and 12 slave states. Additionally, the compromise banned slavery in the existing Louisiana Territory north of latitude line 36/30 but permitted it below the line. President Monroe signed the Missouri Compromise in 1820. For the time being, the Era of Good Feelings continued.

The Missouri Compromise of 1820 helped balance the number of free and slave states in the Union.
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The Panic of 1819

Even though political squabbling was at a minimum, and on the surface America was enjoying a new period of unity, economic problems had not disappeared. For the most part, economic conditions were fairly stable throughout the Monroe Administration, but in 1819 a crisis broke out. The Panic of 1819 was the first major economic depression in American history. The depression stemmed from the Second Bank of the United States restructuring itself too quickly. The Second Bank of the United States had for some time given out risky loans, but by 1818 it began to be more conservative in this area. When it tightened controls fairly suddenly, it triggered the Panic. Speculative land purchasing practices and low agricultural output also played a role.

During the Panic, the prices of goods and real estate plunged while inflation rose. Bankruptcies, foreclosures, and high employment followed. Through government reforms, the Panic subsided within a few years. The Panic of 1819 is often understood in the context of developing industry and commerce conflicting with agriculture. In many ways, the Panic of 1819 helped usher in a new industrial and commercial era in American history.

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