Answer:
There was so little faith in the national government's ability to pay off loans for several reasons:
1. Revolutionary War Debt:
After the American Revolution, the newly formed United States government had accumulated a significant amount of debt from financing the war. This debt burden made it challenging for the government to meet its financial obligations, leading to doubts about its ability to repay loans.
2. Weak Central Government:
The United States initially operated under the Articles of Confederation, which established a weak central government with limited powers. The government lacked the authority to levy taxes or regulate trade effectively, making it difficult to generate revenue to pay off debts.
3. Lack of National Currency:
The absence of a stable national currency further undermined confidence in the government's ability to manage its finances. Each state issued its own currency, which led to economic instability and a lack of trust in the monetary system.
4. Shays' Rebellion:
Shays' Rebellion, a 1786-1787 uprising in Massachusetts by farmers protesting high taxes and debt, exposed the weaknesses of the national government in maintaining law and order. This event raised concerns about the government's ability to enforce financial obligations and exacerbated doubts about its capacity to repay loans.
5. Economic Challenges:
The post-war period was marked by economic difficulties, including high inflation and a lack of economic growth. These challenges further hindered the government's ability to generate sufficient revenue to pay off loans and contributed to the lack of faith in its financial stability.
Overall, the combination of Revolutionary War debt, a weak central government, lack of a stable currency, events like Shays' Rebellion, and economic challenges led to widespread doubts about the national government's ability to pay off loans. These factors eroded confidence in the government's financial capacity and contributed to the prevailing skepticism.