Union and Democracy

by Allen Johnson

Every sufferer by the panic was disposed to blame the National Bank for his misfortunes, particularly as it was common rumor that the directors of the Bank had speculated in its stock and had used their influence to cripple local banks. Congress had been obliged to take cognizance of these charges and to appoint a committee to investigate the condition of the institution. On the report of this committee, in January, 1819, the stock of the Bank fell from 140 to 93. The investigation revealed nothing worse than mismanagement; but a vigorous effort was made in Congress to revoke the charter.

The widespread hostility of the West and South toward the National Bank was born at this time. Everywhere it was known as "the Monster." State after State passed acts to tax the branch banks out of existence. The decision of Chief Justice Marshall, to be sure, in the famous case of M'Culloch v. Maryland, declared emphatically that the States had no constitutional power to tax the branches of an institution chartered under the laws of the United States; nevertheless, the legislature of Ohio deliberately levied such a tax, and when resistance was offered to its collection, withdrew the protection of the State from the branch banks. Feeling themselves the victims of the money power, the people in many of the Western States resorted to the remedies which were broached during hard times under the Confederation. Kentucky became notorious by reason of its laws in behalf of the debtor class. In every Western State there was a disposition to seek shelter from the operation of federal law behind the ægis of State rights. The people of these newer communities were slow to accept the force of precedent in cases decided by the federal courts. Andrew Jackson voiced this feeling when he became President. "Mere precedent," said he, "is a dangerous source of authority, and should not be regarded as deciding questions of constitutional power, except where the acquiescence of the people and the States can be considered as well settled."

That there was much real suffering during this panic admits of no doubt. Niles estimated that not less than twenty thousand persons were seeking employment in Philadelphia in the summer of 1819, and quite as many wandering in the streets of New York looking for work. In both cities soup-houses were established by private charitable societies to relieve distress in the following winter. In the city of New York, during the year 1816, over nineteen hundred unfortunates were imprisoned for debt; and of these, over seven hundred owed less than twenty-five dollars.

But it was not merely the city dweller who felt the pinch of poverty. Thousands of Western settlers who had purchased land under the Act of 1800, which permitted deferred payments, found themselves insolvent. More than $21,000,000, one fifth of the national debt, remained unpaid in the year 1820. To the importunities of these debtors Congress had yielded from time to time, but it was not until 1821 that it passed the first general relief act. Those who had not completed their payments within the prescribed five years were then permitted to give up the land which they had not paid for, and to apply the payments already made to the full purchase of the lands which they retained. Arrears of interest were remitted.

In 1820, Congress passed an act which wrought a far-reaching change in the disposal of the public domain. The credit system was abolished outright. After July 1, 1820, land was to be sold for cash at a minimum price of a dollar and a quarter an acre, and in eighty-acre tracts. A payment of one hundred dollars, then, would make a settler the owner of eighty acres in his own right. The prospect of actual ownership of a small tract made him far less ready to listen to the voice of the tempter in the form of the speculator, who had heretofore lured him to make larger purchases on credit than he could ever pay for by the labor of his hands.

In the midst of this period of financial depression, the Territory of Missouri applied for admission into the Union. On February 13, 1819, while an enabling act was under consideration in the House of Representatives, James Tallmadge, of New York, moved an amendment which touched Southern interests to the quick. "And provided, That the further introduction of slavery or involuntary servitude be prohibited, except for the punishment of crimes, whereof the party shall have been duly convicted; and that all children born within the said State, after the admission thereof into the Union, shall be free at the age of twenty-five years."

This bold attempt to prevent the spread of slavery provoked a brief but momentous debate. Clay left the Speaker's chair to remonstrate, "in the name of humanity," against a policy which could result, he believed, only in the misery of the slaves of the South. The lot of the negro would be vastly improved if the unfortunate people were more widely dispersed. Taylor, of New York, called this a specious plea. "It is that humanity," said he, "which seeks to palliate disease by the application of nostrums, which scatter its seeds through the whole system." To open the West to slavery would be simply to create an additional demand for the importation of slaves. Of those Southern Representatives who took part in this debate, not a man posed as the defender of slavery in the abstract. Barbour, of Virginia, frankly admitted that slavery "like all other human things is mixed with good and evil—the latter, no doubt, preponderating." And Johnson, of Kentucky, maintained that though slavery might be a necessary evil, "not incompatible with true religion," even so "slavery must still be a bitter draught."

What rankled in the breasts of all Southern men was the insinuation that their social system was founded on hypocrisy and tyranny. Tallmadge commented with biting sarcasm on the willingness of Southern gentlemen to contribute to missionary enterprises for the uplifting of the Hottentots and Hindus, and their determination to keep their African slaves in ignorance. And his colleague contrasted the plantations, overrun with weeds on one side of Mason and Dixon's line, with the cultivated farms on the other: in Pennsylvania, he observed "a neat, blooming, animated, rosy-cheeked peasantry"; in Maryland, "a squalid, slow-motioned black population." These were barbed shafts which left sore wounds.