The Treaty of Versailles, signed in September 1783, granted the Americans independence and the western lands they claimed by the ancient right of conquest. The western lands, first claimed by individual states but soon ceded to the federal government, were a valuable asset, collectively owned. How to use them best for the collective good was the problem and the challenge.
For the most part, the great Land Ordinances of 1785 and 1787 determined land policy through the guiding spirit of Thomas Jefferson. Throughout his career, Jefferson had three main goals for land policy: (1) to provide revenues to the federal government through sales, but not perpetual taxes; (2) to spread democratic institutions; and (3) to ensure clear property rights to the land owned by individuals, thereby enhancing their liberty and freedom and providing incentives (recall Economic Reasoning Proposition 3, incentives matter, in Economic Insight 1.1 on page 9) to utilize and make improvements on the land. Individual rights to buy, improve, work, and sell the land also inevitably created opportunities to speculate.
Fearing the potential threat of an excessively powerful, land-rich national government, Jefferson argued that the land should be transferred in a swift but orderly manner to the people. He advocated a process of privatization. First, surveys would be made and boundaries clearly marked. Sales from the federal government to private persons would transfer title completely. The federal government would not tax the land. As populations and settlements spread west, territories would be formed and then through application become states, entering the Union on an equal footing with the existing states. All this was fundamentally Jefferson’s vision, part of his legacy that remains with us today.
World History
