A School History of the United States by John Bach McMaster

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Adams, it was known, would be nominated to succeed himself, and about
him gathered all who wanted a tariff for protection, roads and canals at
national expense, and a distribution among the states of the money
obtained from the sale of public lands. These were the "Adams men," or
National Republicans.

%331. Antimasons.%--But there was a third party which arose in a very
curious way and soon became powerful. In 1826, at Batavia in New York, a
freemason named William Morgan announced his intention to publish a book
revealing the secrets of masonry; but about the time the book was to
come out Morgan disappeared and was never seen again. This led to the
belief that the masons had killed him, and stirred up great excitement
all over the twelve western counties of New York. The "antimasons" said
that a man who was a freemason considered his duty to his order superior
to his duty to his country; and a determined effort was made to prevent
the election of any freemason to office.

[Illustration: Andrew Jackson ]

At first the "antimasonic" movement was confined to western New York,
but the moment it took a political turn it spread across northern Ohio,
Pennsylvania, New York, Vermont, and Massachusetts and Rhode Island, and
was led by some of the most distinguished men and aspiring politicians
of the time[1].

[Footnote 1: Stanwood's _Presidential Elections_, Chap. 18]

%332. The Election of Jackson.%--When the presidential election
occurred in 1828, there were thus three parties,--the "Jackson men," the
"Administration," and the Antimasonic. But politics had very little to
do with the result. In the early days of the republic, the mass of men
were ignorant and uneducated, and willingly submitted to be led by men
of education and what was called breeding. From Washington down to John
Quincy Adams, the presidents were from the aristocratic class. They were
not men of the people. But in course of time a great change had come
over the mass of Americans. Their prosperity, their energy in developing
the country, had made them self-reliant, and impatient of all claims of
superiority. One man was now no better than another, and the cry arose
all over the country for a President who was "a man of the people."
Jackson was just such a man, and it was because he was "a man of the
people" that he was elected. Of 261 electoral votes he received 178,
and Adams 83.

%333. The North and the South Two Different Peoples.%--Before
entering on Jackson's administration, it is necessary to call attention
to the effect produced on our country by the industrial revolution
discussed in Chaps. 19 and 22. In the first place, it produced two
distinct and utterly different peoples: the one in the North and the
other in the South. In the North, where there were no great
plantations, no great farms, and where the labor was free, the marvelous
inventions, discoveries, and improvements mentioned were eagerly seized
on and used. There cities grew up, manufactures nourished, canals were
dug, railroads were built, and industries of every sort established.
Some towns, as Lynn, Lowell, Lawrence, Fall River, Cohoes, Paterson,
Newark, and Pittsburg, were almost entirely given up to mills and
factories. No such towns existed in the South. In the South men lived on
plantations, raised cotton, tobacco, and rice, owned slaves, built few
large towns, cared nothing for internal improvements, and established no
industries of any sort.

This difference of occupation led of course to difference of interests
and opinions, so that on three matters--the extension of slavery,
internal improvements, and tariff for protection--the North and the
South were opposed to each other. In the West and the Middle States
these questions were all-important, and by a union of the two sections
under the leadership of Clay a new tariff was passed in 1824, and in the
course of the next four years $2,300,000 were voted for internal
improvements.

The Virginia legislature (1825) protested against internal improvements
at government expense and against the tariff. But the North demanded
more, and in 1827 another tariff bill was prevented from passing only by
the casting vote of Vice President Calhoun. And now the two sections
joined issue. The South, in memorials, resolutions, and protests,
declared a tariff for protection to be unconstitutional, partial, and
oppressive. The wool growers and manufacturers of the North called a
national convention of protectionists to meet at Harrisburg, and when
Congress met, forced through the tariff of 1828. The South answered with
anti-tariff meetings, addresses, resolutions, with boycotts on the
tariff states, and with protests from the legislatures. Calhoun then
came forward as the leader of the movement and put forth an argument,
known as the South Carolina Exposition, in which he urged that a
convention should meet in South Carolina and decide in what manner the
tariff acts should "be declared null and void within the limits of
the state."

%334. May a State nullify an Act of Congress?%--The right of a state
to nullify an act of Congress thus became the question of the hour, and
was again set forth yet more fully by Calhoun in 1831. That the South
was deeply in earnest was apparent, and in 1832 Congress changed the
tariff of 1828, and made it less objectionable. But it was against
tariff for protection, not against any particular tariff, that South
Carolina contended, and finding that the North would not give up its
principles, she put her threat into execution. The legislature called a
state convention, which declared that the tariffs of 1828 and 1832 were
null and void and without force in South Carolina, and forbade anybody
to pay the duties laid by these laws after February 1, 1833.[1]

[Footnote 1: Houston's _A Critical Study of Nullification in South
Carolina_; Parton's _Jackson_, Vol. III., Chaps. 32-34; Schurz's _Life
of Clay_, Vol. II., Chap. 14; Von Holst's _Life of Calhoun_, Chap. 4;
Lodge's _Life of Webster_, Chaps. 6, 7; Rhodes's _History of the United
States_, Vol. I., pp. 40-50.]

Jackson, who had just been reelected, was not terrified. He bade the
collector at Charleston go on and collect the revenue duties, and use
force if necessary, and he issued a long address to the Nullifiers. On
the one hand, he urged them to yield. On the other, he told them that
"the laws of the United States must be executed.... Those who told you
that you might peacefully prevent their execution deceived you.... Their
object is disunion, and disunion by armed force is treason."

%335. Webster's Great Reply to Calhoun.%--Calhoun, who since 1825 had
been Vice President of the United States, now resigned, and was at once
made senator from South Carolina. When Congress met in December, 1832,
the great question before it was what to do with South Carolina. Jackson
wanted a "Force Act," that is, an act giving him power to collect the
tariff duties by force of arms. Hayne, who was now governor of South
Carolina, declared that if this was done, his state would leave
the Union.

A great debate occurred on the Force Act, in which Calhoun, speaking for
the South, asserted the right of a state to nullify and secede from the
Union, while Webster, speaking for the North, denied the right of
nullification and secession, and upheld the Union and the
Constitution.[1]

[Footnote 1: Johnston's _American Orations_, Vol. I., pp. 196-212;
Webster's _Works_, Vol. III., pp. 248-355, 448-505; Rhodes's _History
of the United States_, Vol. I., pp. 50-52.]

%336. The Compromise of 1833%.--Meantime, Henry Clay, seeing how
determined each side was, and fearing civil war might follow, came
forward with a compromise. He proposed that the tariff of 1832 should be
reduced gradually till July, 1842, when on all articles imported there
should be a duty equal to twenty per cent of their value. This was
passed, and the Compromise Tariff, as it is called, became a law in
March, 1833. A new convention in South Carolina then repealed the
ordinance of nullification.

%337. War on the Bank of the United States%.--While South Carolina
was thus fighting internal improvements and the tariff, the whole
Jackson party was fighting the Bank of the United States. You will
remember that this institution was chartered by Congress in 1816; and
its charter was to run till 1836. Among the rights given it was that of
having branches in as many cities in the country as it pleased, and,
exercising this right, it speedily established branches in the chief
cities of the South and West. The South and West were already full of
state banks, and, knowing that the business of these would be injured if
the branches of the United States Bank were allowed to come among them,
the people of that region resented the reestablishment of a national
bank. Jackson, as a Western man, shared in this hatred, and when he
became President was easily persuaded by his friends (who wished to
force the Bank to take sides in politics) to attack it. The charter had
still nearly eight years to run; nevertheless, in his first message to
Congress (December, 1829) he denounced the Bank as unconstitutional,
unnecessary, and as having failed to give the country a sound currency,
and suggested that it should not be rechartered. Congress paid little
attention to him. But he kept on, year after year, till, in 1832, the
friends of the Bank made his attack a political issue[1].

[Footnote 1: Roosevelt's _Life of Benton_, Chap. 6; Parton's _Life of
Jackson_, Vol. III., Chaps. 29-31; Tyler's _Memoir of Roger B. Taney_,
Vol. I., Chap. 3; Von Hoist's _Constitutional History_, Vol. II., pp.
31-52; Schurz's _Clay_, Vol. L, Chap. 13; _American History
Leaflets_, No. 24]

%338. The First National Nominating Convention; the First Party
Platform.%--To do this was easy, because in 1832 it was well known
that Jackson would again be a candidate for the presidency. Now the
presidential contest of that year is remarkable for two reasons:

1. Because each of the three parties held a national convention for the
nomination of candidates.

2. Because a party platform was then used for the first time.

The originators of the national convention were the Antimasons. State
conventions of delegates to nominate state officers, such as governors
and congressmen and presidential electors, had long been in use. But
never, till September, 1831, had there been a convention of delegates
from all parts of the country for the purpose of nominating the
President and Vice President. In that year Antimasonic delegates from
twenty-two states met at Baltimore and nominated William Wirt and
Amos Ellmaker.

The example thus set was quickly followed, for in December, 1831, a
convention of National Republicans nominated Henry Clay. In May, 1832, a
national convention of Democrats nominated Martin Van Buren for Vice
President[1]; and in that same month, a "national assembly of young
men," or, as the Democrats called it, "Clay's Infant School," met at
Washington and framed the first party platform. They were friends of
Clay, and in their platform they demanded protection to American
industries, and internal improvements at government expense, and
denounced Jackson for his many removals from office. They next issued an
address to the people, in which they declared that if Jackson were
reelected, the Bank would "be abolished." [2]

[Footnote 1: It was not necessary to nominate Jackson. That he should be
re-elected was the wish of the great body of voters. The convention,
therefore, merely nominated a Vice President]

[Footnote 2: For party platform see McKee's _National Platforms of all
Parties._]

%339. Jackson destroys the Bank.%--The friends of the Bank meantime
appealed to Congress for a new charter and found little difficulty in
getting it. But when the bill went to Jackson for his signature, he
vetoed it, and, as its friends had not enough votes to pass the bill
over the veto, the Bank was not rechartered.

The only hope left was to defeat Jackson at the polls. But this too was
a failure, for he was reelected by greater majorities than he had
received in 1828.[1]

[Footnote 1: Of the 288 electoral votes, Jackson received 219, and Clay
49. Wirt, the Antimason, secured 7.]

%340. Jackson withdraws the Government Money from the Bank.%--This
signal triumph was understood by Jackson to mean that the people
approved of his treatment of the Bank. So he continued to hurt it all he
could, and in 1833 ordered his Secretary of the Treasury to remove the
money of the United States from the Bank and its branches. This the
Secretary[1] refused to do; whereupon Jackson removed him and put
another,[2] who would, in his place. After 1833, therefore, the
collectors of United States revenue ceased to deposit it in the Bank of
the United States, and put it in state banks ("pet banks") named by the
Secretary of the Treasury. The money already on deposit was gradually
drawn out, till none remained.[3]

[Footnote 1: William J. Duane. ]

[Footnote 2: Roger B. Taney. ]

[Footnote 3: Parton's _Jackson,_ Vol. III., Chaps. 36-39; _American
History Leaflets,_ No. 24; Sumner's _Jackson_, Chaps. 13, 14; Von
Hoist's _Constitutional History,_ Vol. II., pp. 52-79; Roosevelt's
_Benton_, Chap. 6. ]

For this act the Senate, when it met in December, 1833, passed a vote of
censure on Jackson and entered the censure on its journal. Jackson
protested, and asked to have his protest entered, but the Senate
refused. Whereupon Benton of Missouri declared that he would not rest
till the censure was removed or "expunged" from the journal. At first
this did not seem likely to occur. But Benton kept at it, and at last,
in 1837, the Senate having become Democratic, he succeeded[1].

[Footnote 1: When the resolution had passed, the Clerk of the Senate was
ordered to bring in the journal, draw a thick black line around the
censure, and write across it "Expunged by order of the Senate, January
16, 1837."]

%341. Wildcat State Banks.%--As soon as the reelection of Jackson
made it certain that the charter of the Bank of the United States would
not be renewed, the same thing happened in 1833 that had occurred in
1811. The legislature of every state was beset with applications for
bank charters, and granted them. In 1832 there were but 288 state banks
in the country. In 1836 there were 583. Some were established in order
to get deposits of the government money. Others were started for the
purpose of issuing paper money with which the bank officials might
speculate. Others, of course, were founded with an honest purpose. But
they all issued paper money, which the people borrowed on very poor
security and used in speculation.

%342. The Period of Speculation.%--Never before had the opportunity
for speculation been so great. The new way of doing business, the rise
of corporations and manufactures, drew people into the cities, which
grew in area and afforded a chance for investors to get rich by
purchasing city lots and holding them for a rise in price. Railroads and
canals were being projected all over the country. Another favorite way
of speculating, therefore, was to buy land along the lines of railroads
building or to be built. Suddenly cotton rose a few cents a pound, and
thousands of people began to speculate in slaves and cotton land. Others
bought land in the West from the government, at $1.25 an acre, and laid
it out into town lots,[1] which they sold for $10 and $20 apiece to
people in the East. In short, everybody who could was borrowing paper
money from the banks and speculating.

[Footnote 1: Sometimes ten such lots would be laid out on an acre]

Under these conditions, any cause which should force the banks to stop
loaning money, or to call in that already loaned, would bring on a
panic. And this is just what happened.

%343. The Specie Circular.%--Speculation in government land was so
general that the annual sales rose from $2,300,000 in 1831, to
$24,900,000 in 1836.[2] Finding that these great purchases were paid for
not in gold and silver, but in state bank paper money, Jackson became
alarmed. Many of the banks were of doubtful soundness, and if they
failed, all their money which the government had taken for land would be
lost. In 1836, therefore, Jackson issued his "Specie Circular," which
commanded all officials authorized to sell government land to receive
payment in nothing but gold or silver or land scrip. A great demand for
specie and a removal of it from the banks in the East to those in the
West followed, which of course hurt the Eastern banks, because it took
away some of their money, and that kind of money which they were holding
for the purpose of redeeming their paper.

[Footnote 2: Shepard's _Van Buren_, Chap. 8; Sumner's _Jackson_, pp.
322-325]

Another thing which hurt the banks, by forcing them to stop loaning and
to call for a settlement of debts, was the distribution of the surplus
revenue among the states.

%344. The Surplus Revenue.%--What caused this surplus revenue? Many
things.

1. The United States had no debt. The national debt, you remember, was
created in 1790 by funding the foreign and Congress debt and assuming
those of the states, and amounted to $75,000,000. When Jefferson was
elected President in 1801, this debt had risen to $80,000,000; but
during his administration it fell to $57,000,000. The war with England
raised it to $127,000,000, after which it once more decreased year by
year till 1835, when every dollar was paid off, and the United States
was out of debt[1].

[Footnote 1: As bonds, etc., to the value of $35,000 were never
presented for payment, the United States appears to have always been in
debt. This $35,000 probably represents evidences of indebtedness lost by
the owners]

2. The expenses of the government were not large.

3. There was a heavy importation of foreign goods, which produced a
great revenue under the tariff act.

4. The immense speculation in government lands already described
produced a large income to the government[1].

[Footnote 1: The land sales were $4,800,000 in 1834, $14,757,000 in
1835, and $24,877,000 in 1836]

In consequence of these causes, the government on June 1, 1836, had in
the banks $41,500,000 more than it needed.

What to do with this useless money sorely puzzled Congress. It could not
reduce the tariff, because that was gradually being reduced under the
compromise of 1833. Some wanted the money derived from the sale of land
distributed. But at last it was decided to take all the surplus the
government had on January 1, 1837, subtract $5,000,000 from it, and
divide the rest by the number of senators and representatives in
Congress, and give each state as many parts as it had senators and
representatives[1].

[Footnote 1: One state, New York, was to receive $4,000,000, three
states over $2,000,000, six over $1,000,000, and eight over $500,000]

On January 1, 1837, the surplus was $42,468,000, which, after
subtracting the $5,000,000, left $37,468,000 to be distributed. It was
to be paid in four installments[1]; but only three of them were ever
paid, for, when October 1, 1837, came, the whole country was suffering
from a panic[2].

[Footnote 1: The days of payment were Jan. 1, April 1, July 1, and Oct.
1, 1837]

[Footnote 2: Bourne's _History of the Surplus Revenue of 1837_]

%345. The Panic of 1837.%--Now, when the banks in which the
government surplus was kept were suddenly called on to give it up in
order that it might be distributed among the states, (as they had
loaned this surplus) they were all forced to call it in. More than that,
they would make no new loans. This made credit hard to get. As a
consequence, mills and factories shut down, all buying and selling
stopped, and thousands of workmen were thrown out of employment. As
everybody wanted money, it followed that houses, lands, property of
every sort, was offered for sale at ridiculously low prices. But there
were no buyers. In New York the distress was so great that bread riots
occurred. The merchants, unable to pay their debts, began to fail, and
to make matters worse the banks all over the country suspended specie
payment; that is, refused to give gold and silver in exchange for their
paper bills. Then the panic set in, and for a while the people, the
states, and the government were bankrupt[1].

[Footnote 1: Shepard's _Van Buren_, Chap. 8.]

%346. Election of Martin Van Buren; Eighth President.%--In accordance
with the well-established custom that no President shall have more than
two terms, Jackson [Illustration: Martin Van Buren] would not accept a
renomination in 1836. So the Democratic national convention nominated
Martin Van Buren and R.M. Johnson. The Whigs, as the National
Republicans called themselves after 1834, did not hold a national
nominating convention, but agreed to support William Henry Harrison. Van
Buren was elected, and inaugurated March. 4, 1837[1].

[Footnote 1: _Ibid_., Chap. 7.]

%347 The New National Debt; the Independent Treasury.%--But scarcely
had he taken the oath of office when the panic swept over the country,
and his whole term was one of financial distress or hard times. The
suspension of specie payment and the failures of many banks and
merchants left the government without money, and forced Van Buren to
call an extra session of Congress in September, 1837. Before adjourning,
Congress ordered the fourth or October installment of the distributed
revenue to be suspended. It has never been given to the states.
Congress also authorized the Secretary of the Treasury to issue
$10,000,000 in treasury notes, and so laid the foundation for the second
national debt, which one cause or another has continued ever since.

The experience the government had thus twice passed through (1814 and
1837) led the people to believe it ought not to keep its money in state
banks. But just where the money should be kept was a disputed party
question. The Whigs insisted on a third National Bank like the old one
Jackson had destroyed. Van Buren wanted what was called an "Independent
Treasury," and after four attempts the act establishing it was passed
in 1840.

The law created four "receivers general" (one each at Boston, New York,
Charleston, and St. Louis), to whom all money collected by the United
States officials should be turned over, and directed that "rooms,
vaults, and safes" should be provided for the safe keeping of
the money.[1]

[Footnote 1: Shepard's _Van Buren,_ Chap. 9.]

As might be expected, the people laid all the blame for the hard times
on Van Buren and his party. The Democrats, they said, had destroyed the
National Bank; they had then removed the United States money, and given
it to "pet" state banks; they had then distributed the surplus, and by
taking the surplus from the state banks had brought on the panic.
Whether this was true or not, the people believed it, and were
determined to "turn out little Van."

The campaign of 1840 was the most novel, exciting, and memorable that
had yet taken place. Three parties had candidates in the field. The
Antislavery party put forward James Gillespie Birney and Thomas Earle.
The Democrats in their convention renominated Van Buren, but no Vice
President. The Whigs nominated W.H. Harrison, and John Tyler of
Virginia. The mention of the Antislavery party makes it necessary to
account for its origin.

%348. The Antislavery Movement%.--The appearance of the Antislavery
or Liberty party marks the beginning in national affairs of an
antislavery movement which had long been going on in the states. When
the Missouri Compromise was made in 1820, many people believed that the
troublesome matter of slavery was settled. This was a mistake, and the
compromise really made matters worse. In the first place, it encouraged
the men in Illinois who favored slavery to attempt to make it a slave
state by amending the state constitution, an attempt which failed in
1824 after a long struggle. In the second place, it aroused certain men
who had been agitating for freeing the slaves to redoubled energy. Among
these were Benjamin Lundy, James Gillespie Birney, and William Lloyd
Garrison, who in 1831 established an abolition newspaper called the
_Liberator_, which became very famous. In the third place, it led to the
formation all over the North, and in many places in the South, of new
abolition societies, and stirred up the old ones and made them more
active.[1]

[Footnote 1: _James G. Birney and his Times_, Chap. 12.]

For a time these societies carried on their work, each independent of
the others. But in 1833, a convention of delegates from them met at
Philadelphia, and formed a national society called the American
Antislavery Society.[1]

[Footnote 1: Its constitution declared (1) that each state has exclusive
right to regulate slavery within it; (2) that the society will endeavor
to persuade Congress to stop the interstate slave trade, to abolish
slavery in the territories and in the District of Columbia, and to admit
no more slave states into the Union.]

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