Explain how public debt became an issue prior to the annexation of Texas.(1 point)
Responses
A.Texas received a charter to open a bank prior to the start of the Texas Revolution, which created more debt for the state.
B.Texas started off in debt and continued by taking loans and printing more money to make ends meet.
C.Texas owed Mexico a lot of money for allowing Texas to break free.
D.Texas traded land for money owed with the Compromise of 1850, leaving it with less land to trade to get out of debt.
B. Texas started off in debt and continued by taking loans and printing more money to make ends meet.
Before the annexation of Texas to the United States, the Republic of Texas had accumulated a significant amount of public debt. This debt originated from the costs associated with the Texas Revolution, which eventually led to Texas' independence from Mexico. To fund its government and military, the Republic of Texas had to take out loans, both domestically and from foreign entities, and it resorted to printing additional paper money, which contributed to inflation and further economic instability. As a result, managing and repaying this debt became a critical issue for the young republic, and it was one of the factors leading to the annexation by the United States in 1845. Upon annexation, the U.S. government assumed the debts of Texas, which partly contributed to the negotiations that led to the Compromise of 1850.