Final answer:
The 'Critical Period' is labeled as such due to the economic struggles and lack of strong central authority under the Articles of Confederation, leading to issues like Shays's Rebellion and indicating the need for the U.S. Constitution.
Step-by-step explanation:
The term 'Critical Period' refers to the era in which the Articles of Confederation governed America, from 1781 to 1789.
This period is labeled as critical for two main reasons. Firstly, the Articles created a government that was economically weak, with no power to levy taxes, which led to financial instability and the inability to effectively manage the country's war-related debt.
Secondly, this government structure failed to provide a strong, centralized authority, which caused issues in foreign diplomacy and internal order, as well as trade regulation between states.
This weakness was demonstrated by events such as Shays's Rebellion, where domestic unrest highlighted the need for a stronger national government capable of maintaining order and unity.
Ultimately, the Critical Period was characterized by the new nation's struggle to balance the desire for decentralized power that resisted the type of control experienced under British rule, with the practical necessities of a strong central government that could negotiate with foreign powers, raise funds, and maintain order.
The period's conclusion saw the drafting and implementation of the U.S. Constitution, which established a more effective federal system, reflecting the lessons learned during these crucial years.