What was one of the challenges facing the new political system in the U.S. around 1790?

One of the significant challenges facing the new political system in the U.S. around 1790 was the Debt Crisis. Following the American Revolution, the newly formed government incurred substantial debt, both domestically and internationally. This financial burden created instability and uncertainty regarding how to manage and repay the debt. Leaders such as Alexander Hamilton proposed plans for federal assumption of state debts and the establishment of a national bank to stabilize the economy and establish credit, which sparked significant political debates about federal versus state power, fiscal policy, and the role of government in economic affairs.

The financial crisis not only threatened the economic viability of the new nation but also tested the limits of governmental authority and the ability to enforce policies, leading to debates that shaped the political landscape of the early republic. Understanding this context illustrates why the debt crisis was a pivotal issue that had long-lasting implications for the United States and its governance.