The Effects of Panics in American History Upon Farmers-Nineteenth Century, pt. 1

Infrastructure and the Election Of 1824

Dec 03, 2023

The 1820’s introduced technological boons that helped the farmers have ever-increasing access to American markets in order to sell ever-increasing amounts of produce. At the same time the westward movement of farmers was increasing exponentially as well, making survival on the farming frontiers increasingly difficult. In the 1820s, America's population was still moving ever westward in search of opportunities and advancement. These people are sometimes depicted as being fiercely independent and strongly opposed to any kind of government control or interference. But in fact they received a lot of government help, directly and indirectly. Government-created national roads, such as the Cumberland Pike and the Erie Canal , helped move farm produce to market. The federal government set up numerous land-grant colleges to train young people in agriculture, as well as agricultural experiment stations and an array of service agencies, all designed to further the education and welfare of the independent farmer. People who held differing opinions about how to achieve the same economic ends fought many of the political and economic struggles that would continue throughout the century. The results of those struggles underscore the importance of both individualism and a degree of government involvement. The people demanded access to the markets. The governments debated over how to grant that access. Henry Clay led the march towards governmental infrastructure. Governmental infrastructure relied on taxing the more established merchants and farmers in the east who complained that they shouldn’t need to subsidize the western farmers who put the meals on those easterners table.

The 1824 election of president saw four prime candidacies as the regional factions began an ardent contest to support their own region with lower taxation and greater access to the produced products from the other regions as well increasing their own regional share of the economy. The only party of any standing was the democratic(republicans) founded by Jefferson. They had maintained the presidency since 1800, and despite a temporary setback in 1808, had maintained complete dominance of both houses of the legislature. John Marshall, federalist-leaning, still maintained an iron-fisted control of the judiciary, but after his notorious Marbury decision, balanced the court to stride away from the political battles over regional dominance. Marshall was to pen his second most known decision in 1824, Gibbons v. Ogden that carefully delineated the federal from the state boundaries of authority. Gibbons did not set well with any of the state governments, it didn’t sit overly well with budding attempts of entrepreneur-innovators trying to dominate markets through monopolistic control of their innovations (specifically Robert Fulton), and yet became the first seminally definitive court decision on the powers of both federal authority and the limitations of federal authority and granted to states all authority limited from federal authority but specified exactly what authorities the states were not able to attempt to compete with the federal authority. The principles Marshall set forth in Gibbons defined that relationship for the next century. But it divided the country to such an extent that each section put forth their own candidate in ‘24. The south offered William H. Crawford from Georgia, but born in Virginia, and having faithfully served in the cabinets of both Madison and Monroe was the logical favorite of the Virginia dynasty that had dominated the presidency for six consecutive terms as their choice for the democratic presidency. But the western democrats no longer had any allegiance to the southern or northern democrats and put forth their own candidate in Andrew Jackson.

But Henry Clay, though frequently allied with both the south (through his efforts to find compromises for the expansion of slavery) and the north (through favoring higher tariffs for manufacturers) as well as his west (through support for those very infrastructure products that resonated with the region’s need to reach the eastern markets), himself had grown up in Virginia and as a young man became the amanuensis of George Wythe, declaration of independence signer, and probably the closest thing to a mentor in the life of contrarian Thomas Jefferson. Wythe was (perhaps) the first to believe in American exceptionalism, or put the idea to paper, that America would be able to lead Europe into democratic governance. Clay gathered his political keenness from his service to Wythe and developed a rather non-sectionalist ideology of the “American System”. Although first elected to the Kentucky delegation to the federal congress as a democratic-repeblican, he became an initial component of the new opposition (after a stint in attempting to found the National Republicans) party the Whigs, that to a limited extent was connected to the older Federalist party had more or less ceased to exist. I say it was limited because while many of the Federalists Clay would join the Whigs, the Whigs themselves were ideologically much more centered on national federalism and the centralism of the federal government that the old Federalist party had ever been. But even though the Whigs would never successfully compete with the Jacksononian Democrats, they would establish themselves to become the primary political opposition to the Jacksonians.

The fourth candidate that year was the New Englander, John Quincy Adams, somewhat aligned with his father’s old party, but had long served the Democratic administrations. He was closely allied with Clay and his American System, but contrary to later assertions than he ran as Whig in 1824, he was the third sectional Democratic candidate. Adams didn’t officially claim partisanship, and hadn’t throughout his career, contrary even to what many respected historians claims, the contemporaries from New England that put his forth were mostly other northerners who were allies of the Democratic-Republicans. And though presidential candidates didn’t exactly “run” in the sense that we think of today, those that were seen as “leaders” were put forth as potential candidates by their political allies, many of whom would be the “electors” who would jockey for their candidate’s selection among the the electors. Lobbying,if it existed at the time, was largely done through and by electors, and though the twelfth amendment was supposed to suspend this by reforming the college procedure to some extent (instead of each elector having two votes, each elector would cast one vote for a united “ticket” of president-vice president) the college still dominated presidential selection processes.

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After his selection by the house to the presidency, it was the democrats who denounced him and declared him to be a”Whig” party president (its first). Of course with four major candidates no one was able to win the electoral college, although in perhaps the first election where the popular vote was considered important, Jackson won a majority of that popular vote. The next election of 1828 would transform the college and the vote of the people would begin to be seen as the determinative factor in how electors would cast their vote. In other words, the population, or the “people”, began to want the electors to vote in alliance with the “popular will” for their presidential preference.

But the electoral vote was split with no winner from the college vote and Congress decided the victor. Clay, the only one who had been forth as a Whig, came in fourth and was therefore ineligible for consideration to become president. Clay used his influence however, with the Whigs in congress, to support Adams and Adams became president via the “corrupt bargain” with the Whigs, which enabled Clay’s appointment by Adams to Secretary of State. That sealed the fate of J.Q. Adams and he was thereafter a Whig. As President (and before) John Quincy Adams wholeheartedly supported the role of the federal government in the sponsorship of projects and institutions designed to improve the conditions of society. He had no constitutional doubts about the authority of the President and Congress to construct a system of internal improvements, ranging from roads and canals to harbors, bridges, and other public works. In this, he supported the "American System" championed by Henry Clay while Clay was in the House. The general plan rested upon the notion of a self-sufficient, but regionally specialized, national economy. Both Adams and Clay believed that a factory-based northern economy would provide markets for southern cotton and western foodstuffs. In exchange, the South and West would purchase northern manufactured goods.

In his first annual message to Congress, President Adams presented an ambitious program for the creation of a federal improvement package that included roads, canals, a national university, a national astronomical observatory, and other initiatives. Many congressmen, even his supporters, had trouble with his proposals. His critics challenged the supposed arrogance of a President who had been narrowly elected by the House. In their minds, Adams was not entitled to act as though he had received a national mandate for action. He was criticized as having somehow proposed the creation of a “lighthouse in the sky.” Nevertheless what Adams suggested to congress in 1824 might be very similar to what Joseph Biden would initially propose in 2021 for a massive national infrastructural rebuilding.

But through the use of military engineers for survey and construction operations, public land grants, and governmental subscription to corporate stock issues, the administration achieved considerable progress in support of harbor improvements, and road and canal development. Some of the specific projects included extending the Cumberland Road into Ohio with surveys for its continuation west to St. Louis; beginning the Chesapeake and Ohio Canal; constructing the Delaware and Chesapeake Canal and the Portland to Louisville Canal around the falls of the Ohio; connecting the Great Lakes to the Ohio River system in Ohio and Indiana; and enlarging and rebuilding the Dismal Swamp Canal in North Carolina.

The projects put people to work, they were needed, they were regionally successful but, again, like Biden’s infrastructure projects of recent vintage, never helped Adams particularly well on a national platform due to the overwhelming acclamations that the projects would lead to bankrupting the nation by his critics. But then also Adams’ reliance upon Whigs that had enabled him to succeed to the presidency, the signing of the Abominable Tariff into law, and an unrelenting unfavorable projection by a dedicated and

noisy portion of the press, made any popularity he might have had become increasingly difficult to sustain. Especially the signing of what would become known as the Abominable Tariff; and even Adams realized his signing of the tariff would seal his fate to becoming only the second president to fail to earn a second term (his father being the first, of course). It is somewhat too bad (my opinion) that the presidencies of two such very important men in early American history has lessened them in the perspective of many.

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Starting in 1789 with the first tariff to finance the Federal Government, tariffs became the main source of revenue producing method for the U.S. government until the Federal Income tax was introduced in 1913, following a constitutional change to enable it. At times tariffs had raised nearly 95 percent of federal revenues. The 1828 tariff was very controversial because it was designed to protect the industry of the North from competition by cheap imports, while severely hitting the economies of the Southern states. The tariff introduced in the bill was 38 percent on 92 percent of all imported goods. This meant the South had to pay higher prices for their goods. They imported less from Britain in consequence, leaving the British less money with which to buy their cotton. Southerners dubbed it “The Tariff of Abominations,” and started proceedings to nullify it in some of their states.

The tariff of 1828 was a very high protective tariff that became law in the United States in May 1828. It was a bill designed to not pass congress because it was seen by free trade supporters as hurting both industry and farming, but it passed anyway. The House committee drafted a bill that imposed very high duties on raw materials, including iron, hemp (for rope) and flax, but eliminated the protective features on woolen goods. The alliance organized by Van Buren, that included the middle and southern states and the south, then proceeded to vote down every attempt by New Englanders to amend the bill. The alliance was confident the bill was so unfavorable that it would be defeated in Congress, hurting Adams and Clay in the process. To the astonishment of the alliance, a substantial minority of New England congressmen voted for the final bill, on the grounds that the principle of protection was of enormous value. The bill passed the house 105 to 94 on April 23 and passed the Senate 26 to 21 on May 13. President Adams signed it and the tariff became law. The irony to it was that the merchants in New England didn’t want the tariff anymore than the rest of the nation. Merchants viewed tariffs as an impediment to their import-export business. But after the passage of Jefferson’s embargo (aiming to hurt the northern merchants) industrialism had grown enough to having increasing power, especially in some parts of New England and in some areas in New Jersey, and begin to dominate the economy in central Pennsylvania. Manufacturers wanted tariffs to be high enough to damage the importation of goods and force Americans to “buy American”. Merchants needed to have products to import, but realize that at that time, American manufacturing was minuscule to the output of Britain (England and Scotland), and frankly to China. China? No, China had not industrialized goods to any extent, but the concept of owning large facilities to produce goods had begun centuries prior to anywhere else in the world. When Marco Polo returned to Europe with all of his wondrous marvels in the 13th century, the linens, silks, spices, and gunpowder–they were all produced not in homes or by individual craftsmen, but in large “manufacturing” facilities maintained by surfish labor that barely survived while the leaders of these facilities amassed wealth and power. In the 1820’s imports from China were responsible for five times more than the purchases America self-produced. At the time then merchants grew wealthier from what they imported into America that what they were able to export. There was only beginning to be a market for American manufactured goods to be exported and our principal exports were still produce, principally tobacco and cotton. As the producers of most of America’s wealth, the south did not favor tariffs that would make exportation less profitable, the merchants wealth depended primarily on importation and high tariffs would diminish their ability to continue to successfully depend on buying elsewhere and being able to incur the cost of bringing goods into America at extremely increased prices. So the merchants and the southern planters devised this peculiar scheme to make the tariff so high that it would fail to pass into law.

Adams favored tariffs, but he thought they should be more tempered to a more balanced approach that could help merchants continue to import and to export the produce that was the principal source of America’s wealth, and support the financing of the infrastructure that enabled America’s westward march. The manufacturer’s of course thought no tariff too high to protect what the new industries were manufacturing, but realized, as did Adams, that since our industries were not producing enough to become an international trader we needed to have lesser tariffs on imports we were not producing to accredit a cost balance to what was needed to be imported. The scheme to prevent most tariffs, or to keep them very low, in 1828, was to create even higher tariffs on goods that Americans wanted. Sugar being a good example—Louisiana not yet involved in much American production even though the sugar plantations had long been established but even when they became more integrated into the American economy would never actually produce enough sugar to supply America’s demand for sugar, even to this day. So a very high tariff on sugar was akin to the British tax on tea in the 1770’s as far as most Americans were concerned. So the idea of this plot was to defeat the alliance of the manufactures with those moving west and wanted high tariffs on imports that would help their increasing ability to sell their produce to the markets within America that Adam’s infrastructure projects were making increasingly possible to do; and their minerals, principally iron and coal, to fuel the burgeoning manufacturing industries. And so the southerners and the northern merchants believed if they could prevent any amendments to the 1828 tariff from being offered, then no tariff bill would be accepted because as a whole the tariff increases would be more unpalatable than not having any new tariff bill.

Unfortunately for the alliance that had put forth the nonsensical tariff that they thought would defeat any new tariff bill did not take into account a dire situation in New England. The manufacturers new production of goods, while not being enough to make exportation reliably competitive with other nations were too much and hindered the profits merchants could earn from importing the products that couldn't compete in cost with the home-produced goods. Many a New England merchant were being forced into bankruptcy. Merchants were the first elite class in the colonies and had amassed the first fortunes in what would become the United States. Coupled with the New England farmers, again facing foreclosure, once again due to the increased interstate commerce flowing into New England from the west that the infrastructure and the new constitutional provisions that permitted no limitations or taxation upon interference with interstate commerce. So what was coming into the east, from the west, could be marketed at the same, or sometimes, because of the amount of goods and produce coming into the region, lower prices. The result was that after all amendments had been voted down, a minority of New England congressmen ended up preferring high tariffs to no tariffs to save their constituents from bankruptcy, that consequently effected their states’ tax base.

And this is why Marshall’s decision in Gibbons v. Ogden indirectly limited the states’ ability to raise revenues through monopolistic grants to enterprises within their states that could then be used to gather taxes from those monopolies when they extended their enterprises beyond the states that had granted the monopolies, or prevented similar enterprises from competing against the state authorized monopolies.

Not saying Gibbons was in error, but that the unintended consequence was to reduce state revenue and create a situation where the Abominable Tariff was seen as necessary to prevent the harm to individual businesses or farmers within some of the states’ economy. Gibbons was indisputably correct in its interpreting the constitution, and as Marshall himself wrote in that decision, the principal and most emphatic meaning and purpose of the constitution. I agree totally with Marshall’s emphasis upon that point. If there is one point I do not think can be interpreted in any way other than as Marshall did, it is that congress alone has total control over interstate congress and certainly one of the principal purposes of the constitutional convention was to bind the states into a commitment of a national economy instead of remaining individual states competing economically one against the other. The delegates, to some extent,feared that such intra-state rivalries could lead to intra-state conflicts that might splinter any alliances between the states. Individually the states couldn’t pay their war debt, individually the states could barely defend themselves from their own citizens (why I believe the states demanded the second amendment to allow for them to have a”well-ordered militia”); individually the states would have been easily susceptible to reconquest by European nations if the union that had fought for independence fractured. In order to accomplish this the delegates who gathered in Philadelphia in 1787 knew that the one thing the individual states had to be willing to sacrifice to the federal government was a secession of authority over a national economy. That was the prime reason, however, that one of the delegates who had been one of the leading voices for a stronger national unification of the states, refused to sign the constitution. George Mason felt that without both maritime parity and without an economic stability of some parity between all of the states, that this very control of the national economy would end up creating the very fracture the convention was intended to prevent. And in a way George Mason ended up being correct. The individualized and differing and de-equalized regional economies was the primary destabilizer between the regions that resulted in the civil war, and to a great extent the continued disagreements between states authority and the federalism that continue to plague America. That conflict is continuingly ongoing in our politics and if Lincoln thought the problem that divided the America house was merely about slavery,I would suggest he was incorrect. Conservatism in America remains strongly pro-state, anti-federal; liberalism more strongly favoring increasing federal authority.

Of course the delegates to the constitution were correct if there was a desire to create “a nation” instead of thirteen loosely allied states there had to be a way to make local economies subjected to the national economy. And of course if they had not done that any long-term unity between the loosely allied states would have resulted in multitudinous conflicts against each other. And the history of the courts of the United States of settling these disputes is too numerous to recite; but without any national manner (supreme court) of settling border, economic, and other differences that arose, these inter-regional disputes would have resulted in many a”war” between states.

But the alliance has never been an easy one, the interstate rivalries have remained a constant (“you can’t leave my state and go to another to get an abortion” is only the latest challenge; or “I don’t want immigrants in my state so I’m going to send them to your state” that could lead to New York going to war against Texas.) But even more court decisions have entered on the national government’s total control of all interstate commerce and the state and local desire to control their own economy. Inevitably the states lost. The converse to states fighting against each other is that they lose control to nationalized corporations that could move at will into the local economies. Local economies do sometimes court large businesses to their locales, but this becomes a necessity when local economies have been reduced to dependence on the national economic corporations. Wal-Mart can provide more general wealth to a local economy than a mom & pop in the community. So mom & pop end up going to work at Wal-Mart. Large corporations can control all of the economic fortunes and panics or downturns that affect millions and the nation slides between economic booms and periodic crashes. The economic wealth of all is centered in fewer and fewer hands that then can recklessly assert their power, knowing full well that if they overspeculate and cause harm, the harm becomes primarily centered in the locales where they assert control and not to these interstate megaliths. The megaliths, in turn, assume control over the farmers by controlling the markets where there produce is packaged and distributed that in turn reduces the amount the farmer is able to earn from his own production and increases the cost of food to everyone. What if a farmer could earn directly from those he sold his produce to.? What if the farmer could keep forty cents of every fifty cents of what he sold to the consumer, instead of the current average of only eight and half cents out of every fifty cents. The consumer would only be paying the local farmer, not the corporation who sells him the produce and in his intermediary role controls not only the produce, but what type of produce the farmer can sell, and limit the farmer to being nothing more than an employer of the corporation and pays the farmer a more negligible amount for his labors by reducing his independence of production to dependence on the corporation.

And therefore, by taking control of the national economic welfare against the local economic control of the economy that permits wealth to amass into the hands of the providers of the larger corporations who supply the interstate commercial interest, congress, who is supposed to be in charge of the national economy are forced to abdicate that role because the wealth of the corporation leads to their ability to control their controllers (congress) by using that wealth to make the economy dependent upon them and thus creating a congress afraid to challenge the powers that control the wealth. (Of course individuals within the congress have, some still do–but as a general principle congress is a slave to their own creation). Just as the southern slavemasters became dependent on their slaves as the source of their wealth, the government becomes dependent on the corporations that exist only because they were empowered to exist by congress’s grant to control the national economy. We enter into the chief absurdity of economics. To grow an economy, governments grant power over the economy to the largest players in the economy who then demand the government to abrogate any authority over them so that the economy can continue to grow.

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I suppose the chief nemesis of my life has been the economics of Ayn Rand based on the idea of the super-endowed individual who enables the growth of the economy and are therefore entitled to unlimited non-restraint by the government no matter the consequence to those not so endowed because the not so endowed have no participatory rights in the economy that is only possible at all because of the production of the super-endowed.

The reality appears to be in opposition to that position. The government grows in power (stature and influence over other nations by outcompeting them economically) by granting economic earldoms over the participants under the control of the government. The participants (citizens) are thus handed over in surfdom to the economic earldoms by the government in order to increase their stature and power amongst other nations.

This is meant to reduce conflict. The states originally granted the federal government economic control over themselves in order to reduce conflict amongst themselves and make the nation itself more competitive in stature with other nations.

But from my perspective this not only increases conflicts between nations who are being subjected to being reduced in power and stature by the nations with more power and stature; but it reduces all communal authority to the authority of economic earldoms that have been authorized by the government to inflate the stature and power of the government. The participants of the nation become citizens and as citizens are surfs who are confined to the nation they participate within (or non-citizen immigrants) just as surfs were confined to the land of their earldom or lordship) and by ensurfing their citizens to the economic-earldoms that enable the economic growth necessary for a nation to increase in power and stature, they allow for these economic earldoms to become the slavemasters of those participants necessary to produce the growth that the nations themselves need to grow in stature and wealth.

If nations did not wish to achieve power through economic growth that grants them increased stature over other nations, then there would be little need for nations to grow and economies could become totally communally independent on devising their own economies as they wished. They would not need to grow; only to satisfy their needs and they could create a free market between what they produce and what they wish to import by interchanging in a non-growth economy each with other. There would be no necessary slacks because there is no growth being accumulated. Granting that if a community produced something no longer viably exchangeable it might need to refocus its attention on producing something else, or it might just cease to be, its participants going elsewhere to join other communities. Growth only occurs, in the economic sense, by controlling the market of resources and labor. That can lead to workers demanding higher wages, but higher wages does nothing to correct the central issue of the market control of the resources, and the laborer’s increased wage helps him in no way to increase his stature .within the company he is getting a high wage from; nor does it give him any control of the resources that often use the offer of increasing labor costs to take a stronger advantage of controlling prices and growing over market competitors by increasingly limiting competitors to the same access to control the labor and the resources necessary to be competitive with those who have more control. Reagan, Rand, etc. were correct that the more control the fewer have the greater the wealth of the nation, but as the wealth of the nation increases, the power of the citizens decreases and democracy loses its authenticity as a government of, for,or by its citizens.

If a democracy presented to its citizens not growth of the economy but stability of the economy as its prime principle of governance, then democracy’s authenticity increases with its participants. Depressions don’t occur absent prosperity but because of prosperity; and nations themselves might have less conflict between themselves if they didn’t feel they needed to have more stature over other nations.

But when growth is the only determinant, then there are periods when needs become unfulfilled from oversaturated growth and declines begin. In America this cycle has continued, basically every fifteen to twenty years and we have fought against ourselves in a continued series of subjecting others to horrors in order for growth to occur, and reducing them to having their needs unmet when growth becomes paralyzed. The problem is growth teaches dishonesty as its necessary means because growth only occurs by attempting to deceive those whose control of the resources are lacking can be remedied only by concentrating more resources into fewer hands. Those who have more resources do have the resources to create economic booms, but economic booms create speculations on how to increase growth for some that are presented deceptively to suggest methods of sustaining and concentrating more control of the marketplace into hands. This in turn requires deceiving the “voters” that they are participants in what they are really not participants within. Of course that deception is never universally accepted by the participants and the deceptions are furthered by the deceptions of the “isms” that both offer greater participation to some if they deny participation to others. If you have more education you can “grow” in stature to others with less education, but the status of already being in the upper echelons of the growth system does not really alter. The upper echelon benefits from education than do those who had less ability to participate. As a result educational attainment does not insure greater personal growth (although it can for some of those who were not previously in the primary elite, but transforms itself into a deceptive regime where the less educated are seen as less socially viable and more “ignorant.” The result education becomes less about what one learns and more about what can attain over others if one is educated. But there always reaches a saturation in what level of education must be obtained to be able to attain more.

The “ism of race, the “ism” of sex, the “ism” of religion, the “ism” of sexual orientation are never about race, sex, religion, orientation, etc.; they are always about the conflict resultant from attempting to obtain growth over another.

The concept of growth presents the conflict between nation and other nations, in the U.S. between federalism and statism, and ultimately between individual participants who have been seduced by the idea that growth an ever achieve stability or an honesty between those vying to grow.

The conflicts that begin arising in 1824 were the conflicts of economic competition and who should be able to grow within that economy and all of this would come to a head in 1828 as the “constitutional” principles underwent there first attempt at transforming the elitism the constitutional drafters (in its finalized “constitution”) presented mainly to preserve their own elitism. But by 1828 that elitism was being challenged because of the very economy that more wanted to be allowed to participate in growing their own sectors or interests and attaining the parity that George Mason had thought necessary for a government to survive. The first big constitutional hurdle actually was the concept that the people should elect the president who should be the one who obtained the most “popular votes. And so in 1828 American democracy became transformed to the popular mandate, and that mandate began to be centered on an executive who appealed to the population.

It would not be the solution to creating a much more consensual democracy or a more parous economic opportunity to new elites that could challenge the old elites. But the idea of the executive, rather than the legislature being the way towards reproducing the disparities in the economic agenda only began to take root in 1824, but four years later it had become front and center with the election of Andrew Jackson.

The UnUtopian Optimist

The Effects of Panics in American History Upon Farmers-Nineteenth Century, pt. 1

Infrastructure and the Election Of 1824

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