The decision regarding the status of areas to be settled in the future also involved a great political principle. Were these areas to remain in colonial dependence, subject to possible exploitation by the original 13 states? Or were they to be admitted into a union of states on a basis of equality? The answers to these questions would test the foresight and selflessness of Americans, who had themselves escaped the dominance of a ruling empire (Economic Reasoning Propositions 1, scarcity forces us to make choices; 3, incentives matter; and 4, laws and rules matter).
In 1787, Congress addressed the problems of establishing the political principles for western settlement. The Ordinance of 1787 provided that the Northwest Territory should be organized as a district to be run by a governor and judges appointed by Congress. As soon as it contained 5,000 male inhabitants of voting age, a territorial legislature was to be elected, and a nonvoting delegate was to be sent to Congress. At least three and not more than five states were to be created from this territory; when any one of the established divisions of the territory contained a population of 60,000 inhabitants, it was to be admitted to the Union as a state on a basis of complete equality with the older states. Contained in the ordinance were certain guarantees of civil and religious liberties, proper treatment of Native Americans, together with a prohibition of slavery in the territory.37 The main principle, however, was the eventual equality of status for the new areas. The age-old source of trouble between colony and ruling country was thus removed by a simple, although unprecedented, device—making the colonies extensions of the empire that would be allowed to become socially and politically equal. Recall Economic Reasoning Proposition 4, laws and rules matter.
World History
