The Panic of 1819 (13 page)

Thus, faced with widespread debts and insolvencies, states in every region were confronted with, and wrangled over, debtors’ relief proposals. Stay laws were considered in the eastern legislatures of Delaware, New Jersey, New York, Maryland, Vermont, Massachusetts, Pennsylvania, and Virginia, as well as in the western states of Ohio, Indiana, Illinois, Missouri, Louisiana, Tennessee, and Kentucky. Minimum appraisal laws were also considered in almost all of these states. Stay laws were passed in Maryland, Vermont, Ohio, Indiana, Illinois, Missouri, Louisiana, Tennessee, and Kentucky; minimum appraisal laws were passed in far fewer states: Ohio, Indiana, Missouri, Pennsylvania, and Kentucky.

If final passage is considered, the western states were the stronghold of relief measures. However, Pennsylvania passed a combined minimum appraisal and stay law, and there were at least sizable minorities demanding stay and minimum appraisal laws in such important and conservative states as Delaware, New Jersey, New York, and Virginia. Vermont and Maryland passed stay laws, and New York modified its judgment procedure slightly to ease the strain of insolvent debtors. Rhode Island eased the burdens of debtors to banks. Neither was the western experience uniform. Ohio and Indiana, for example, passed their legislation overwhelmingly, while there was bitter controversy in Missouri, Tennessee, and Kentucky. Four of the western states passed appraisal laws, while they could not pass in Illinois and Tennessee.

Within the states there was a noticeable lack of sharp division along sectional lines in controversy over this legislation. Within urban centers and rural counties, there was sharp controversy over relief, and tides of opinion impressed themselves in turn up on all sections.

Debtors’ relief proposals were often tied to schemes for monetary expansion, which furnished one of the richest areas of controversy during the depression.

____________________

¹
United States,
Public and General Statutes
, vol. 2, pp. 73, 533.

²
Ibid., vol. 3, pp. 96, 433, 515, 555. Postponement of forfeiture laws were passed in 1810, 1812, 1813, 1814, and 1815.

³
U.S. Congress,
Annals of Congress
, 16th Congress, 2d Session, p. 15.

⁴
Ibid. The message was presented on November 14, 1820. The relief issue had been briefly raised late in the previous session in a resolution of the Louisiana legislature, but consideration was deferred until the 1820–21 session. Ibid., 16th Congress, 1st Session, p. 467.

⁵
Johnson was later to become a key leader in the Jacksonian movement and Jackson’s intimate agent. He became vice-president under Van Buren.

⁶
Annals of Congress, 16th Congress, 1st Session, pp. 17, 22.

⁷
U.S. Congress,
American State Papers: Finance
4, no. 599 (December 5, 1820): 547ff.

⁸
Memorials came from Ohio, Illinois, Indiana, Alabama, Tennessee, and Kentucky. Ibid., pp. 22, 36, 77, 99, 116, 126, 130, 131, 134, 141, 153, 212, 249, and 436.

⁹
Speech of Thomas, January 11, 1821, U.S. Congress,
Annals of Congress
, 16th Congress, 2d Session, p. 156. Thomas was an aristocratic lawyer, formerly a Representative from Tennessee, and Federal Judge in Ohio. He nominated his friend William Henry Harrison for President in 1840.

¹⁰
Ibid., pp. 161–78. Edwards had been Chief Judge of the Kentucky Court of Appeals and Governor of Illinois Territory.

¹¹
These were its “Mississippi stock,” made receivable in the Southwest, and in claims to its lands in the Northwest.

¹²
On January 30, 1821. Ibid., p. 251.

¹³
Ibid., pp. 214–22.

¹⁴
Eaton was a lawyer, landowner, and land speculator, and an intimate associate of Andrew Jackson, his wife having been Jackson’s ward. He was later to be Secretary of War under Jackson.

¹⁵
Ibid., pp. 180, 214–36. The New Englander was Senator Morrill of New Hampshire. Other Senators attacking the amendment were Noble of Indiana, Johnson of Kentucky, Thomas, and King and Walker of Alabama.

¹⁶
Thus, arguing for the extra relief to settlers were Senators Johnson, King of Alabama, Ruggles of Ohio, while on the opposite side were Talbot of Kentucky, Edwards, and Noble.

¹⁷
Ibid., p. 333. The bill passed on February 10, 1821. Senator Eaton voted for the final bill.

¹⁸
Ibid., p. 441.

¹⁹
Ibid., pp. 1187–89 and 1221ff.

²⁰
Ibid., pp. 1221ff., 1228ff.

²¹
In this action, one of the leading advocates of the bill, Richard C. Anderson of Kentucky, head of the Committee on Public Lands, joined forces with the anti-reliefers to defeat the proposal by a narrow vote of 85 to 70. Henry Clay, of Kentucky, was leader of the extreme relief forces on this occasion.

²²
Metcalf was later to become Governor and Senator from Kentucky, and to oppose state inconvertible paper plans.

²³
For the text of this law, see U.S. Congress,
American State Papers
, vol. 3, pp. 612–16.

²⁴
Niles’ Weekly Register
15 (January 31, 1819): 423; 19 (November 25, 1820): 194.

²⁵
Abernethy,
Formative Period
, p. 56.

²⁶
Madeleine,
Monetary and Banking Theories
, pp. 27ff.; Greer, “Economic and Social Effects,” pp. 228–29.

²⁷
Although one of the supporting arguments for proposals for increased paper currency was the consequent relief of debtors, they will be considered separately, because of the many other issues that the monetary proposals presented. In many cases, stay laws were tied together with the monetary plans and were promulgated as attempts to bolster the general acceptability of the new paper, and so to benefit the debtor who could use it in payment.

²⁸
Delaware General Assembly,
Journal of the House of Representatives, 1819
(January 26): 91; (February 2): 139.

²⁹
Ibid. (February 3): 150ff. Three of the dissenters, however, were from New Castle County.

³⁰
The vote was 26 to 10. For the vote, see New Jersey Legislature,
Votes and Proceedings of the General Assembly, 1819–20
(June 13, 1820). For the report of the Hopkinson Committee, see ibid. (June 2, 1820): 202–05. Hopkinson had been a distinguished Federalist lawyer and Congressman from Philadelphia, and was soon to return there.

³¹
New York Legislature,
Senate Journal, 1819
(April 5): 251–52.

³²
Ibid.,
1821
(March 13): 223.

³³
Matthew P. Andrews,
Tercentenary History of Maryland
(Chicago: S.J. Clarke Co., 1925), p. 1741; Boston
New England Palladium
, February 1, 1820. Maryland also abolished imprisonment for debt in 1819. The movement for abolition, however, is only tangential to our study, since it was a continuing humanitarian movement rather than an economic measure.

³⁴
Cleveland
Register
, July 6, 1819.

³⁵
New York
Daily Advertiser
, June 17, 1819; January 11, 1820.

³⁶
By a vote of 62 to 59, after repeated refusal to postpone the bill by fluctuating margins, as high as 97 to 56. Vermont General Assembly,
House Journal, 1818–19
(October 10, 1818; November 6, 1818; November 10, 1818): 143ff., 167.

³⁷
The bill passed by a vote of 87 to 47. Ibid.,
1819–20
(November 10, 1819): 172ff.

³⁸
The vote was 115 to 38. Ibid.,
1820–21
(October 27, 1820): 101.

³⁹
Walter Hill Crockett,
Vermont, the Green Mountain State
(New York: The Century History Co., 1921), vol. 3, p. 181.

⁴⁰
Howard K. Stokes, “Public and Private Finance,” in Edward Field, ed.,
State of Rhode Island and Providence Plantations at the End of the Century: A History
(Boston: The Mason Publishing Co., 1902), vol. 3, pp. 264–71, 291ff.; and Clarence S. Brigham, “The Period from 1820 to 1830,” in ibid., vol. 3, p. 304.

⁴¹
Throughout this paper, “conservative” will be used as a term connoting such views.

⁴²
Richmond
Enquirer
, February 1, 1820.

⁴³
Ibid. The debate took place in the House of Delegates on January 28.

⁴⁴
Ibid., February 5, 1820.

⁴⁵
Rives was later to become one of the most prominent Virginia statesmen, a Jacksonian who favored state banking and balked at the sub-treasury scheme. Also supporting the bill was Representative Joseph Lovell of Kanawha, in West Virginia, who pointed to the “unusual embarrassment” of the times. Ibid., February 3, 1820.

⁴⁶
Ibid., February 1, 1820.

⁴⁷
The danger of setting a precedent in impairment of contract was stressed by Representative Andrew Stevenson, of the city of Richmond. Ibid.

⁴⁸
Ibid., February 5, 1820.

⁴⁹
One was rejected by a vote of 76 to 47, and the other by 95 to 84. The latter bill had previously been tentatively approved by a vote of 109 to 71. Virginia General Assembly,
Journal of the House of Delegates, 1820–21
(January 19, January 25, February 17): 126, 140, 131.

⁵⁰
Ibid.,
1819–20
(December 6, 1819): 6–9.

⁵¹
See below for arguments on industry and economy as the remedies for hard times.

⁵²
North Carolina, Historical Records Survey Project,
A Calendar of the Bartlett Yancey Papers
(Raleigh: North Carolina Historical Society, 1940), p. 4.

⁵³
Representative Noble was from Bedford County in far Western Pennsylvania, and Representative Reeder represented Luzerne and Susquehanna Counties in the North. For their proposal, see Pennsylvania Legislature,
Journal of the House, 1818–19
(December 10, 1818): 113.

⁵⁴
Findlay was later U.S. senator and treasurer of the U.S. Mint under Jackson.

⁵⁵
For the text of the report, see Pennsylvania Legislature,
Journal of the House, 1819–20
(January 28, 1820): 476–88.

⁵⁶
Duane’s own remedies will be considered below.

⁵⁷
State Senator Condy Raguet, of Philadelphia, headed a committee to investigate the extent, causes, and remedies of the distress. Its report will be considered further. Its text is in Pennsylvania Legislature,
Journal of the Senate, 1819–20
(January 29, 1820): 221–36, and the documentary appendix to the report is to be found in ibid. (February 14, 1820): 311–37.

⁵⁸
Kehl,
Ill-Feeling
, pp. 12–13.

⁵⁹
Pennsylvania Legislature,
Laws of Pennsylvania, 1819–20
(March 28, 1820): 155.

⁶⁰
“A Pennsylvanian” in Philadelphia
Union
, February 11, 1820.

⁶¹
Greer, “Economic and Social Effects,” p. 238.

⁶²
Charles C. Huntington,
A History of Banking and Currency in Ohio Before the Civil War
(Columbus: Ohio Archaeological and Historical Society, 1915), pp. 300ff.; comment of Philadelphia
Union
, August 27, 1821; Cleveland
Herald
, October 16, 1821.

⁶³
Cleveland
Herald
, March 20, 1821. This attitude contrasts with the tone of the press before the laws were passed when it was angry at the rapacity of the creditors. Thus, see Cleveland
Register
, May 25, 1819, August 10, 1819.

⁶⁴
On the pervasive insolvency in Ohio in this period, see William Greene, “Thoughts”; John J. Rowe, “Money and Banks in Cincinnati Before the Civil War,”
Bulletin of the Historical and Philosophical Society of Ohio
6 (July 1948): 74–84; Goss,
Cincinnati
, pp. 139–41; Davis, “Economic Basis,” pp. 289–90.

⁶⁵
Jacob Piatt Dunn,
Indiana and Indianans
(Chicago: American Historical Society, 1919), p. 326.

⁶⁶
Indiana General Assembly,
Laws
, 3rd General Assembly, p. 68; on debtors’ relief laws in Indiana, see Waldo F. Mitchell, “Indiana’s Growth,” pp. 389–91.

⁶⁷
Indiana General Assembly,
Journal of the Senate, 1818–19
, p. 36.

⁶⁸
Indiana General Assembly,
Laws
, 4th General Assembly, pp. 113ff.; Mitchell, “Indiana’s Growth.”

⁶⁹
Garnett,
State Banks
, pp. 8–13. This law succeeded previous laws, enacted in 1813 and 1817, which had provided stays of one year for refusal of creditors to accept at par the notes of various Illinois banks. George W. Dowrie,
The Development of Banking in Illinois, 1817–63
(Urbana: University of Illinois Press, 1913), p. 11; Knox,
A History of Banking
, p. 712.