The commercial interests of the East were quick to see the possibilities of this new market. An eager rivalry sprang up between the merchants of New York, Philadelphia, and Baltimore. Everywhere ways and means of cheaper transportation were discussed. In this subject the Western farmer was vitally interested, for freight charges added nearly one third to the cost of merchandise transported over the mountains. The cotton planter of the Seaboard States, also, feeling the competition of the Southwest, where riverways were abundant and easily navigable, saw the need of better roads to tidewater, in order to lessen the cost of marketing his produce.

The popular demand for better roads was not recent. All the States had encouraged, directly or indirectly, the building of turnpikes and bridges. Between 1793 and 1812, Pennsylvania had chartered fifty-five turnpike companies, and other States had been scarcely less ready to grant articles of incorporation to stock companies. Private enterprise had, indeed, done much to improve communication along the seaboard. Turnpikes and bridges had shortened the journey by stage from Boston to Washington to four and a quarter days by the year 1815. The city of New York was in 1816 within twenty-four hours of Albany by the Hudson River steamboats.

Numerous canal companies had also been chartered; but of all the canals projected, only three had been completed when the War of 1812 began: the Dismal Swamp Canal in Virginia, the Santee Canal in South Carolina, and the Middlesex Canal in Massachusetts. It remained for New York to usher in a new era in internal communication by authorizing in 1817 the construction of the Erie Canal. In the ardent imagination of its chief promoter, De Witt Clinton, this canal was destined to be "a bond of union between the Atlantic and Western States" and "an organ of communication between the Hudson, the Mississippi, the St. Lawrence, the Great Lakes of the North and West, and their tributary rivers," creating "the greatest inland trade ever witnessed" and transforming New York into a vast emporium of commerce and "the granary of the world."

This bold bid for Western trade alarmed the merchants of Philadelphia, particularly as the completion of the national road threatened to divert much of their traffic to Baltimore. In 1825, the legislature of Pennsylvania grappled with the problem by projecting a series of canals which were to connect its great seaport with Pittsburg on the west and with Lake Erie and the upper Susquehanna on the north.

The magnitude of the transportation problem was such, however, that neither individual States nor private corporations seemed able to meet the demands of an expanding internal trade. As early as 1807, Albert Gallatin had advocated the construction of a great system of internal waterways to connect East and West, at an estimated cost of $20,000,000. But the only contribution of the National Government to internal improvements during the Jeffersonian era was an appropriation in 1806 of two per cent of the net proceeds of the sales of public lands in Ohio for the construction of a national road, with the consent of the States through which it should pass. By 1818 the road was open to traffic from Cumberland, Maryland, to Wheeling, Virginia.

In 1816, with the experiences of the war before him, no well-informed statesman could shut his eyes to the national aspects of the problem. Even President Madison invited the attention of Congress to the need of establishing "a comprehensive system of roads and canals." Soon after Congress met, it took under consideration a bill drafted by Calhoun which proposed an appropriation of $1,500,000 for internal improvements. Because this appropriation was to be met by the moneys paid by the National Bank to the Government, the bill was commonly referred to as the "Bonus Bill." "Let it not be forgotten," said Calhoun in advocacy of his bill, "that it [the size of the Union] exposes us to the greatest of all calamities,—next to the loss of liberty,—and even to that in its consequences—disunion. We are great, and rapidly—I was about to say fearfully—growing. This is our pride and our danger; our weakness and our strength.... We are under the most imperious obligation to counteract every tendency to disunion.... Whatever impedes the intercourse of the extremes with this, the center of the Republic, weakens the Union."

The one section which was impervious to these national considerations at this moment was New England; but it was President Madison, and not New England, who defeated the Bonus Bill. On the day before he left office, Madison sent to Congress a notable veto message. Reverting to his earlier faith, he pronounced the measure unconstitutional. Neither the express words of the Constitution nor any fair inference could, in his judgment, warrant the exercise of such powers by Congress. To pass the bill over his veto was impossible. Monroe, too, in his first message to Congress intimated that he also held strict views of the powers of Congress. The policy of internal improvements by Federal aid was thus wrecked on the constitutional scruples of the last of the Virginia dynasty.

Having less regard for consistency, the House of Representatives recorded its conviction, by close votes, that Congress could appropriate money to construct roads and canals, but had not the power to construct them. As yet the only direct aid of the National Government to internal improvements consisted of various appropriations, amounting to about $1,500,000 for the Cumberland Road.

Circumstances were also pressing the claims of the Far West upon the Government. Beyond the scattered settlements of Illinois and Indiana extended vast forests, known only to the Indians and the fur traders. With the experiences of the war fresh in mind, the new Secretary of War, Calhoun, urged upon the Government the necessity of taking resolute measures to hold this territory. Laws excluding foreigners from the Indian trade were passed; forts were established at strategic points like Chicago, Prairie du Chien, and Green Bay; and in 1820, Governor Cass, of the Michigan Territory, was sent on an expedition through the Wisconsin forests into Minnesota, to assert American claims wherever British influence was still felt.

Still farther west lay an almost unknown region of imperial dimensions. Save where venturesome pioneers had pushed up the Arkansas and the Missouri, and where the Spaniards maintained their feeble hold in the Southwest, no white men inhabited the great prairies which swept westward to the foothills of the Rockies. Only nomadic Indian tribes and occasional traders followed the buffalo trails across this wide expanse. Between the Rocky Mountains and the Pacific was the region which Lewis and Clark had penetrated. Along the valley of the northern branch of the Columbia River, the Hudson's Bay Company had planted their trading posts. Farther to the south lay Spanish California and the ill-defined region to the eastward over which presidios maintained a shadowy jurisdiction.