An account of the money market during the war (based mainly on the financial columns of the New York Weekly Herald) may be of interest. During the early spring of 1846 the Oregon controversy with England was a strong depressing influence. The outbreak of the war with Mexico caused a panic (May 11), but this passed immediately (May 12), and by May 19 the market was rather buoyant, largely in consequence of favorable news from Taylor. It then declined; but about the middle of June there was a plethora of money, and much activity prevailed in consequence of the settlement of the Oregon controversy. This faded gradually away into dulness, but quickened again about the first of August. Fluctuations followed. The first half of September saw a decline. Sept. 5 United States bonds that had sold at 113 before the war brought only 102, but the prospect of foreign demands for grain caused a revival (Sept. 20-Oct. 3). Dulness then returned; the general feeling about the war was reflected in very low prices about the middle of November, and Dec. 7 was a “blue day.” Though the treasury required all payments to it to be in specie on and after Jan. 1, 1847, it did not begin to pay out specie until Apr. 1. Hence it piled up coin during the interim. Jan. 3, 1847, the market was rather stringent. During the second half of February, the Bank of England rate rose from 3 to 4. Prices continued to decline until by April 4 good prospects at the seat of war and an influx of specie turned the tide. May 1 the New York banks were said to have more than $12,000,000 in specie. May 10 Reading R. R. difficulties precipitated a panic, but this was only a flurry. Money was extremely abundant in a few days (May 19) and prices advanced until about the middle of July. During the second week of August the increasing war expenses bore hard on the market, and treasury notes fell about 2 per cent. About Oct. 1 the report that Scott had entered Mexico City was found to be untrue, and a panic set in (Oct. 4), due to that fact and bad news regarding the financial situation in Europe. The “explosion” of “corners” followed. By Nov. 11 the banks were “shaking in the wind,” and a crisis came on at once (Nov. 14). Paper money was loudly called for. After a troubled month, however, money became much easier and prices responded (Dec. 19). Another month, and the banks (really in a tight place themselves) were believed to be tightening everything to force a change in the financial policy of the government (Jan. 25, 1848); but by Feb. 10 natural conditions revived buoyancy, and there was a loud call for more treasury notes. Things then quieted down, but the arrival of the draft of a treaty stimulated activity once more. Absurd rumors about the terms of the treaty next caused a temporary reaction; but when it was accepted, prices went up (Mar. 11). For the day-by-day prices of United States securities, Dec. 1, 1846, to Dec. 1, 1847, see Ho. 6; 30, 1, p. 71.
Other financial legislation of the war period. U. S. Statutes at Large, ix, p. 35, Act of June 27, 1846, sec. 2: $75,000 in U. S. stock belonging to the Seneca Indians to be cancelled, and interest to be paid them on a credit of that amount to be entered on the books of the secretary of the treasury. P. 94, Act of Aug. 10, 1846: Mexican Indemnity Stock (see Bayley, National Loans, 71, modified by statements of this work). P. 106, Act of Aug. 10, 1846: Treasury notes, stolen and put into circulation, to be redeemed by the government. P. 125, Act of Feb. 11, 1847, sec. 9: Any non-commissioned officer, musician and private entitled under this Act to receive a certificate or warrant for 160 acres (or 40 acres) may take instead of it $100 (or $25) in 6 per cent treasury scrip, redeemable at the pleasure of the government. P. 248, Act of July 19, 1848: Three months’ extra pay to all who actually served out their term or were honorably discharged, or the heirs of those who lost life or died after being honorably discharged. P. 249, Act of July 21, 1848: Act of July 4, 1836, granting half-pay and pensions to widows, orphans, etc., made applicable to cases of these in the Mexican War. P. 412, Act of March 3, 1849: To provide for settling accounts of those who received money from military contributions, etc., in Mexico. P. 414, Act of March 3, 1849: To provide payment for property lost or destroyed in the military service of U. S. P. 520, Act of Sept. 28, 1850: Bounty lands to be given to certain officers and soldiers who served in the Mexican War.
XXXIV. THE WAR IN AMERICAN POLITICS
[1.] The chief sources for this chapter were personal correspondence, the debates of Congress, and periodicals representing all shades of politics. The leading newspapers were examined for every day of the war and also before and after it.
[2.] Parker, Sermon. Rhodes, U. S., i, 88. Weekly N. Y. Herald, May 23. No. Amer., May 15, 21. [191]Fairfield to wife, July 10, 1846.
[3.] London Times, Aug. 31. Welles papers (account of 29 Cong., 2 sess.). [108]Marcy to Bancroft, Apr. 28, 1847. Calhoun Corresp., 717 (to T. G. C), 1096 (Fisher). [13]Pakenham, nos. 119, 132, 1846; 6, 9, 1847. [139]Gentry to C, Feb. 20, 1847. [139]A. to D. C., Jan. 20, 1847. Journal des Débats, Nov. 4, 1846. (Elections) N. Y. Tribune, Nov. 26, 1847; [132]Stokes to Buchanan, Jan. 3, 1847; Welles papers; Schurz, Clay, ii, 289; Von Holst, U. S., iii, 336; N. Y. Herald, Nov. 7, 14, 1846; Wash. Union, Oct. 16, 22; Nov. 9, 14, 19, 27, 1846; May 5, 1847; Nat. Intellig., Nov. 7, 1846. Pub. Ledger, Dec. 23, 1846. In the winter we find some state legislatures passing resolutions (Ho. 93, 97; 29, 2) in favor of prosecuting the war, but these are signs of prevailing discouragement.
[4.] (Nomination and election) Smith, Annex, of Texas, 250–2, 310–5. [345]Gilpin to Van Buren, May 24, 1846. [234]A. Johnson to ——, July 22, 1846, private. London Times, July 15, 1846. Welles papers. Nat. Intellig., Nov. 20, 1847. (Cabinet) Polk, Diary, Feb. 8, 1847; [345]Blair to Van Buren, Jan. 29; Feb. 29, 1848; [297]correspond. between Polk and M. Van Buren, C. Johnson, A. V. Brown and others, Dec, 1844-Feb., 1845; Poore, Perley’s Remins., i, 334; Welles papers; [297]Simpson to Polk, Nov. 13, 1848. (Myself) Tenn. Hist. Mag., Sept., 1915 (to C. J., Dec. 21, 1844). Boston Atlas, Dec. 31, 1846. [206]Mangum to Graham, Feb. 21, 1845. (Polk’s discretion distrusted) Cong. Globe, 29, 1, pp. 554 (Allen), 567 (Webster).
What is said of Polk in this and succeeding paragraphs should be supplemented by referring to vol. i, pp. 128–9 and to the concluding chapter.
[5.] For a study of Polk’s character see vol. i, pp. 128–9. [345]Pauling to Van Buren, Feb. 5, 1847. (Pillow) Polk to Johnson, May 17 [14], 1844: Tenn. Hist. Mag., Sept., 1915. Seward, Seward at Washington, i, 37, 51. [345]Frearoon to Van Buren, Jan. 23, 1847. [345]Blair to V. B., Jan. 29, 1848. Tyler, Tyler, ii, 457 (Gardiner). [345]G. A. Worth to V. B., Mar. 20, 1847. [139]Gentry to Campbell, Feb. 20, 1847. Schurz, Clay, ii, 289. Von Holst, U. S., iii, 273, 292, 336. Boston Atlas, Dec. 12, 1846. Benton, Abr. Debates, xvi, 75 (Badger). Kohl, Claims, 71.
Taking advantage of the feeling about Polk’s personality and methods, his enemies felt warranted in straining points against him. It was called treachery to negotiate with Santa Anna while negotiating with Paredes (No. American, Dec. 15, 1846), even though the latter negotiation had practically ended before the former began. His dwelling upon our claims against Mexico in his annual Message of 1846, which it was quite proper to do in reviewing the Mexican situation, was represented as an afterthought, intended to justify a blow already struck and discrediting the assertion that Mexico had caused the war by invading our territory (Boston Atlas, Dec. 12, 1846). It was pointed out that the proclamation sent to Taylor for distribution ascribed to the United States aims different from those professed in the Message of May 11 (Nat. Intellig., Aug. 14, 1846), as if Polk could be required to say everything every time.