After being elected president in 1816, James Monroe went on a goodwill tour. Huge crowds greeted him so warmly that a newspaper proclaimed an “Era of Good Feelings.” Monroe’s eight years as president are still known by this name today. To many Americans at the time, it seemed that a new period of national unity had dawned.
Economic Nationalism The swelling of nationalist spirit was reflected in proposals that the federal government take a more active role in building the national economy. One of the leading supporters of such measures in Congress was Henry Clay of Kentucky.
Clay was a persuasive speaker, full of charm and intelligence. Driven by ambition, Clay wanted to be president. He campaigned for the office five times, but was never elected.
Clay believed that America’s future lay in capitalism [capitalism: an economic system based on the private ownership of farms and businesses] , an economic system in which individuals and companies produce and distribute goods for profit. Most supporters of capitalism agreed that government should have a limited role in the economy. But Clay believed that the national government had a role to play in encouraging economic growth. Clay supported an economic plan called the American System [American System: a proposal to the government that called for taxes on imports, federally funded transportation projects, and a new national bank]. This plan called for taxes on imported goods to protect industry as well as federal spending on transportation projects like roads and canals.
A third part of Clay’s plan was a new national bank to standardize currency and provide credit. Congress adopted this idea in 1816 when it created the second Bank of the United States. (The first national bank had lapsed in 1811.) The bank was a private business, but the government owned one-fifth of it and deposited government funds there.
Another early champion of economic nationalism was South Carolina’s John C. Calhoun. In Congress, Calhoun supported the national bank, a permanent road system, and a tax on imports. Yet in other ways he resisted federal power. By the 1830s, he would become the leading spokesman for states’ rights, largely to protect slavery in the South. His career illustrates the tensions between nationalism and the pull of regional differences.
A third proponent of nationalism was Daniel Webster of Massachusetts. Webster served several terms in both the House and Senate. Unlike Clay, who was a War Hawk, Webster bitterly opposed the War of 1812. After the war, however, he voiced strong support for Clay’s American System. “Let us act under a settled conviction, and an habitual feeling, that these twenty-four states are one country,” Webster urged in 1825. Later, he would strongly challenge Calhoun’s claim that states had the right to defy the federal government.