Cronyism

CHAPTER 10

ERECTING THE AMERICAN SYSTEM: THE MONETARY INFRASTRUCTURE

The Panic of 1819

In what Robert Remini describes as the “Era of Corruption,” Speaker Henry Clay’s “American System” resurrected the Federalists’ empire-building policies: central banking to coordinate inflation, protective tariffs to subsidize manufacturers, federally funded internal improvements to bind the country together, greater authority of Washington, DC, over settlers’ rights, and imperialist diplomacy to enlarge the domain. In the process, National Republicans and friendly Federalists systematically looted the public purse for private enrichment. However, the Panic of 1819 complicated their plans. The central blame can be laid on the Second Bank of the United States, which continued the wartime inflation and fostered a business cycle. In the aftermath, National Republicans protected the Bank and increased its control over the economy, rekindling controversy over monetary and banking policy.

Stephen Girard, who previously lobbied for the central bank to increase the value of his bond holdings, estimated that the profits from the new Bank “will be immense.” Girard turned into the largest shareholder, and John Jacob Astor ascended to the New York branch’s presidency. Both men also became two of the five government directors, along with William Jones, a former Philadelphia merchant and prior secretary of the Navy; James Buchanan, investment partner of Congressman Samuel Smith in the Baltimore mercantile firm Smith & Buchanan and soon to be president of the SBUS’ Baltimore branch; and Pierce Butler, a former delegate to the Constitutional Convention.

Unfortunately for Girard and Astor, they suffered a setback with the election of the main office’s president. No shareholder could control more than thirty votes, but Baltimore financiers circumvented this restriction with proxies. Lawyer George Williams, the most notorious example, owned 1,172 shares under different clients, allowing him to amass thirty-nine times the voting power allowed. In fact, just fifteen individuals controlled 75 percent of the Baltimore branch’s shares legally held by sixteen thousand individuals, allowing the group to elect the inexperienced Jones to the presidency. Astor and Girard bitterly resented the election, realizing it weakened their influence over the Bank.

Under Jones’ aegis, the SBUS opened in January 1817 and inflated, increasing its notes and deposits from $13.1 million in 1817 to $20.6 million by 1818 (57 percent). In particular, it lent $6 million to the large state banks in New York, Philadelphia, Baltimore, and Virginia to help them resume specie payments, which became federal policy in February. The SBUS’ loans provided an enormous windfall to the fractional reserve institutions, because they used the loans not to return to gold and silver convertibility but instead as reserves for further expansion. No wonder, then, that the number of state banks grew from 212 in 1815 to 338 in 1818. In total, from 1815 to 1817 the money supply increased from $75 million to $94 million, or by 25 percent (12 percent per year). The SBUS’ southern and western branches led the credit expansion, but in Baltimore, the swashbucklers who previously captured the SBUS engaged in outright fraud.

Branch President Buchanan and bank cashier James McCulloch initially loaned themselves $673,000 to speculate in the Bank’s stock. Not satisfied with this investment on the Bank’s behalf, they continued to dig into the public trough. Buchanan and Williams, the deceptively large shareholder, loaned $2.5 million to themselves and McCulloch $574,000. To do so, they falsely claimed to secure their loans with collateral and insisted that the directors approved their actions. In reality, they did not, but Buchanan and Williams paid off President Jones with $18,000 of hush money, who later made a cool $250,000 off his own stock speculation. The two also bribed the Baltimore branch’s bank teller with $50,000. Buchanan, McCulloch, and Williams severely violated the Bank’s charter for their own personal aggrandizement.

The federal government added to the SBUS’ largesse with its own reckless land policies. Congress pushed back due dates for land debts and issued $4 million of “Mississippi stock” as payment for the old Yazoo land claims, receivable as cash for land purchases in the soon-to-be states of Alabama and Mississippi.When combined with SBUS’ monetary expansion, Congress’ policies exploded land indebtedness. The US only sold 4.5 million acres by 1813, with total indebtedness to the government at $2.1 million. In 1815, it sold 1.1 million acres and the total unpaid balance stood at $3.7 million. But speculators soon borrowed from banks to make initial down payments to the government, anticipating endlessly rising prices. Land purchases totaled 5.6 million acres in 1819 alone and total indebtedness ballooned to $24 million, a 548 percent increase from 1815. Land prices increased from $2.20 to $3.37 per acre (53 percent).

The credit expansion led to abnormally low interest rates, which caused an economic boom in farm improvement projects, land speculation, buildings, slaves, turnpikes, ships, and steamboats. Stock transactions increased so much that traders formed the New York Stock Exchange in March 1817. Even though overall prices fell 3 percent from 1816 to 1818 (1.5 percent per year), prices in the aforementioned sectors actually rose. Overall, real GDP and industrial production increased by 6 percent and 10 percent, respectively (3 percent and 5 percent per year).

However, the economic boom was unsustainable, because the Treasury concurrently attempted to resume specie convertibility. Secretary of the Treasury William Crawford, leader of the small-government Radicals, recognized that the monetary contraction necessary for such a goal required retiring the Treasury notes currently serving as bank reserves. After 1815, resuming trade and winding down the war-time apparatus caused Congress to run surpluses from 1816 to 1819, the first time since 1811. Consequently, as the public debt decreased, the supply of the wartime Treasury notes declined from $15.5 million to zero.

This decline would have led to credit contraction if it had not been for the SBUS pumping new reserves into the system. The federal government attempted to have it both ways: a resumption of specie payments and an easy adjustment process for the state banks. But this could not continue forever, thanks to the adverse clearing mechanism. The state banks still refused to resume specie payments while the SBUS’ notes and deposits remained redeemable. Consequently, by mid-1818, specie reserves at the Bank began to decline. If conditions stayed the same, the breaking point would come sooner rather than later. The SBUS had to contract credit, and contract it did.

From mid-1818 to mid-1819, a revolution occurred at the SBUS. First, the financial institution sharply contracted credit, calling in loans, refusing to make new loans, and pressing upon state banks for specie. Its notes and deposits declined from $20.6 million in 1818 to $12.3 million in 1819, a contraction of 41 percent. The contraction caused the money supply to deflate from $94 million in 1817 to $84 million in 1818 (11 percent). Second, Congress investigated the Bank’s illicit practices, culminating in the corrupt Jones’ resignation in January 1819. By March, the public discovered the Baltimore branch’s fraudulent dealings and its $1.5 million loss. These revelations were enormously bad timing for Congress, because a month earlier it had rejected proposals to repeal the Bank’s charter.

Although analysts subsequently described it as the Panic of 1819, no stock market crash or dramatic bank runs occurred. Despite this, everyone could see that a crash had happened, and Thomas Jefferson wrote to his old friend John Adams: “the paper bubble is then burst.” Wholesale prices collapsed 15 percent from 1818 to 1819 and bottomed out in 1821, for a total decline of 31 percent. Prices for exports also plummeted, crushing the indebted South. After rising 57 percent from 1815 to 1818, abundant crop harvests in Europe and a concurrent British contraction caused export staple prices in Charleston to plummet 40 percent from 1818 to 1819, for a total decline of 54 percent by 1821.

The severe monetary and price pressure led to massive bankruptcies as interest rates increased and borrowers defaulted. Public land sales, slave trading, agricultural improvements, steamships, turnpikes, and other projects floundered. The distress was the most acute in the cities, where widespread unemployment afflicted factory workers, artisans, mechanics, and craftsmen. From 1818 to 1819, daily agricultural wage rates shrunk 65 percent, and wages for unskilled turnpike workers dropped 84 percent. Many westerners returned to barter conditions and used grain and whiskey as money. Although the number of state banks increased from 338 in 1818 to 341 in 1819, the total had dropped to 267 by 1822, a decline of 22 percent. In A Short History of Paper Money and Banking (1833), William Gouge aptly summed up the crisis: “The Bank was saved, and the people were ruined.”

Some state banks were also saved, thanks to a suspension of specie payments. The states, Janus-faced about the privileges they continually granted to their financial institutions, aided them in their latest breach of contract. For instance, while Maryland and Pennsylvania passed laws compelling state banks to resume specie payments or forfeit their charters, they allowed them to suspend redemption to money brokers, the traveling arbitrageurs most likely to press banks for convertibility. In addition, Maryland required a crippling $500 license for money brokers and a $20,000 bond to operate a money broker business. Commenting on the banking situation, in April 1821 the Philadelphia merchant and State Senator Condy Raguet wrote to the British economist David Ricardo, a free trade and hard money follower of Adam Smith, admitting “the whole of our population are either stockholders of banks or in debt to them. It is not the interest of the first to press the banks and the rest are afraid.”Banks only resumed specie payments in the early 1820s.

Thanks to the liquidation process, the downturn did not appreciably affect real economic activity. Real GDP and industrial production only declined by 1.9 percent and 4.1 percent in 1819 before increasing from 1819 to 1822 by 4.4 percent and 6.3 percent per year. Even the high unemployment in the cities insignificantly affected the overall country, because most people still worked in agriculture, and a modern study estimates the nationwide unemployment rate at only 4 percent in 1819. However, many members of the public truly believed they experienced a severe depression, because they either lived in the cities or focused on nominal prices. They failed to understand that the decline in nominal values was an illusion and did not accurately correspond with changes in real values.

In fact, nominal values have even fooled modern economic historians. In a recent analysis of the panic, one historian argued that GDP per capita declined by 48 percent (6.3 percent per year) from 1814 to 1824. However, this was only nominal GDP per capita. In reality, the behavior of real GDP performed differently. In the panic year of 1819, nominal GDP per capita did decrease by 4.4 percent, but real GDP per capita fell by only 1.1 percent. Crucially, from 1819 to 1824 nominal GDP per capita declined 10 percent while real GDP per capita actually rose 8 percent (1.5 percent per year). As Joseph Davis explains, falling prices and decreased spending do not necessarily imply reduced economic activity:

One plausible explanation for the disparity [in nine-teenth-century depressions] may be that the media confused commercial crises with financial ones, because the latter were better characterized by falling commodity and security prices, rather than declines in real industrial activity.

Regardless of its actual economic impact, the Panic of 1819 stirred up intense debate over government power. In particular, the SBUS’ monetary authority caused nationwide resentment.

The Rebirth of Monetary Reform

The crisis generated two diametrically opposed perspectives: the hard money view in favor of abolishing cronyism, particularly the SBUS, and the soft money side that espoused the American System’s easy credit. Anti-bank forces filled the ranks of the Crawfordite Radicals while the credit expansion faction coalesced into the National Republicans. Ultimately, the soft money group reigned supreme because of the SBUS’ corrupting influence and the landmark case McCulloch v. Maryland.

The hard money theories of new Smithian economists, particularly Jean-Baptiste Say and Destutt de Tracy, provided an antidote to the country’s woes. Significantly, the Frenchmen influenced politicians, businessmen, and intellectuals to embrace radical laissez-faire thought over the next several decades. Tracy considered irredeemable paper money “the most fatal of all fraudulent bankruptcies” and attacked the “radically vicious” banks the government “privileged.” Say echoed similar sentiments, desiring 100 percent reserves or freely competitive fractional reserve banks. The two writers provided important ideological ammunition for the assault on the corrupt partnership between banking and government.

Classical liberals quickly translated Tracy and Say’s anti-bank theories for public consumption. Jefferson, back in the saddle for laissez faire, edited Tracy’s A Treatise on Political Economy (1817), persuading the College of William and Mary to adopt it as a textbook. He praised its “sound principles of Political Economy” and hoped Tracy would be placed “in the hands of every reader.” The free trade Clement C. Biddle of Philadelphia annotated Say’s identically titled A Treatise on Political Economy (1821). Jefferson also lauded Say’s book because it communicated Smith’s Wealth of Nations in a “shorter compass and more lucid manner.” In fact, Say’s work served as an extremely popular economics textbook. Consequently, in the 1820s, some American economists, such as John McVickar of New York and the 100 percent reserve advocate Condy Raguet, devised rudimentary free banking proposals. In 1826, the redoubtable Thomas Cooper, now at South Carolina College and a key Crawfordite Radical, attacked bank charters for conferring “exclusive privileges upon [one] class, upon motives and pretenses often fraudulent, seldom excusable, never justifiable.” However, it would take time for such revolutionary theories to affect politics.

In the meantime, the hard money contingent restricted fractional reserve state banks. According to Murray Rothbard, “controls over banks were not considered interference in the market but rather an exercise of the government’s sovereign rights over the money supply and a prevention of bank interference with the market. The most cogent upholders of this view were the leading Virginians.”Jefferson anonymously wrote a Plan for Reducing the Circulating Medium to achieve “the eternal suppression of bank paper.” He envisioned gradually reducing banknotes and eliminating banking entirely, in essence adopting a 100 percent specie standard. Virginia Governor Thomas Randolph, a son-in-law of Jefferson, pushed for a state-established 100 percent reserve program and the collection of taxes only in specie. Old Republican Spencer Roane lashed out at the SBUS and supported a prohibition on new state bank charters. Some writers even argued for eliminating all limited liability banks, an idea they erroneously attributed to Adam Smith. Virginia’s hostility to banking remained so strong after the panic that it did not charter any new banks for the next fifteen years.

New Yorkers advocated similar policies. Angered at the SBUS’ harsh contraction and blatant corruption, two New York congressmen remarked that they regretted their votes for the “incorporation of that now-swindling monster.” The crisis jolted both Republican factions, the Clintonians of Governor DeWitt Clinton and the Regency of State Senator Martin Van Buren (a key Radical), into the hard money position. Believing the increase in state banks caused the depression, they attacked the chartering system. The 1820 New York Constitution even required a two-thirds majority for any new bank charter.

Unfortunately, both Virginia and New York’s reformers failed to realize that their policies entrenched credit expansion and cronyism by increasing banking interventions. Free entry reduces credit expansion because of the adverse clearing mechanism. On the other hand, restricting bank entry creates regional monopolies that can easily expand credit and corrupt politicians. The free banking solution of unchartered and laissez-faire competition still eluded reformers.

On the other hand, various western states enacted soft money policies, including state-owned banks and government agencies that issued inconvertible paper. In Tennessee, wealthy merchant Felix Grundy pushed for a government loan office that could issue paper money. But the hard money Andrew Jackson sent a memorial to the state legislature citing “judicious political economists” who had demonstrated that the “large emissions of paper from the banks by which the country was inundated, have been the most prominent causes of those distresses of which we at present complain.” Although the legislature nixed the loan office bill, it created the Bank of the State of Tennessee, which that floundered throughout the 1820s.

Crucially, the business downturn turned Jackson into an ardent opponent of government-subsidized banking and fractional reserve banking in general. A similar conversion experience affected the young Tennessee politician and planter, James K. Polk. Jackson grounded his arguments upon strict constructionism, arguing that the moribund coinage clause allowed only a specie currency and prohibited Congress and the states from chartering note-issuing banks. In contrast to John Calhoun’s broad constructionism—the coinage clause sanctioned a national bank to regulate the money supply—Jackson’s strict constructionism required a specie currency. The new interpretation neatly tied in with the growing free market economic thought, heavily influencing opponents of cronyism. Jackson already showed his anti-bank proclivities in 1827, when he supported a Tennessee law that levied a tax on banks chartered outside the state, fuming at the SBUS’ newly established branch. He thundered that the people of Nashville would now be “cursed” with the SBUS’ “attendant evils and corruption.”

Missouri, another state with intense monetary debate, suffered from severe deflation. Responding to the state’s new loan office (later declared unconstitutional because the Constitution explicitly forbids states from issuing money), Senator Thomas Hart Benton argued for a purely specie currency. He viciously attacked the SBUS, charging that citizens were now “mortgaged to the money power” and “in the jaws of the Monster.” Another western politico who shifted to hard money was Amos Kendall, editor of the Kentucky Argus and an economic theorist. Kendall now called banks “disgusting” and supported a constitutional amendment prohibiting them, along with a fallback plan for a 100 percent reserve system. The Panic of 1819 turned the younger Radicals—particularly Van Buren, Jackson, Polk, Benton, and Kendall—into hard money advocates and fierce opponents of the corrupting hydra, the SBUS.

Indeed, the SBUS corrupted many. First, it recruited intellectuals, the Hamiltonian economists and newspapermen who sprouted up to justify central banking and attack free market economics. Their ranks included Hezekiah Niles of the Niles Weekly Register, Mathew Carey, the protectionist Friedrich List, and the Federalist Daniel Raymond. In addition, the National Republicans’ establishment periodical, the National Intelligencer, supported the Bank for loans. The paper embodied the modern secularization of the alliance of throne and altar: the National Intelligencer received lucrative contracts to print congressional documents in return for sponsoring congressmen’s interventionist policies. A cozy partnership indeed! It did not help that the paper’s editors spent lavishly and poorly managed the enterprise.

Second, the highly skilled Nicholas Biddle worked for the institution. A former Federalist who married into a wealthy Philadelphia family, Biddle was appointed by his friend Monroe as a government director in January 1819. Smart and arrogant, just like his ideological mentor Hamilton, Biddle firmly believed in the American System. He thought that the war proved the indispensability of a central bank to regulate state banks and supported cheap credit to alleviate the panic, particularly to manufacturers and transportation companies. Unsurprisingly, the interventionist rejected Adam Smith. In early 1823, Biddle started his new job as president of the SBUS.

Third, the Bank bribed high-profile politicians, particularly Henry Clay and Daniel Webster, to serve as corporate lobbyists. Clay, the son-in-law of a wealthy Kentucky businessman, fixated on funneling cheap credit to his state. At the Bank’s inception, the Speaker befriended President Jones and persuaded the main office to establish branches in Lexington and Louisville, exerting enormous influence in choosing their directors. After the panic, Clay temporarily retired from his Speakership to work for the SBUS and pay off his $40,000 debt. Astor assisted him with a $20,000 loan that an anonymous benefactor only paid off in 1845. The central bank paid Clay an annual retainer of $6,000, more than the secretary of state’s salary, to collect outstanding debts (Clay could also acquire foreclosed property). Critics continually accused Clay of favoritism. For example, while filing four hundred suits in Ohio and Kentucky’s federal courts to collect $2 million in debts, he tried to exempt Senator Richard Johnson’s $200,000 obligation. He also earned $2,000 for his legal services defending the SBUS in the federal courts.

Webster adhered to one principle his entire life: follow the money. The Boston Associates and Biddle ranked among his biggest contributors. Thanks to Webster’s influence, the Boston Associates dominated the Boston branch’s board (Webster’s brother-in-law also served as a director). Unsurprisingly, they secured “kissing privileges,” or easy credit terms, for their businesses. Webster owned stock, performed legal work, and, thanks to his good friend Biddle, served as a director. Furthermore, the congressman received a retainer that he frequently wanted “renewed or refreshed as usual.”This retainer was in addition to the $32,000 in no-fee loans he had accumulated over the years.

Fourth, and perhaps most importantly, Chief Justice John Marshall protected the Bank from legal assaults. Marshall, a stockholder in the institution, recognized that the Bank protected federal power over the states. This became especially apparent when Maryland and Ohio tried to weaken its influence. The states reasoned that since they taxed their own state banks, they could also tax the SBUS, viewing it as an expression of their sovereign rights against federal encroachment. Most notably, Maryland enacted a $15,000 annual tax on all non-state-chartered banks, including the SBUS. The embezzling McCulloch unsurprisingly refused to pay, sending the case McCulloch v. Maryland to the Supreme Court and onto the arch-Federalist’s lap.

Old Republicans had long grown wary of the Supreme Court. Over the years Marshall and his protégé, Joseph Story increasingly empowered the federal government through judicial review, particularly in Marbury v. Madison (1803), Fletcher v. Peck (1810), and Fairfax’s Devisee v. Hunter’s Lessee (1813). Recall that in the last case, Story declared that the Marshalls indeed owned titles to the Fairfax Estate, thereby overruling Virginia. However, Spencer Roane used the Spirit of 1798 to nullify the decision. He declared part of the 1789 Judiciary Act unconstitutional, insisting that Virginia could decide the constitutionality of its legislation better than the Supreme Court. Of course, Marshall did not accept this Antifederalism for an answer, filing an appeal to his Supreme Court. After Marshall once again recused him-self, Justice Story declared in Martin v. Hunter’s Lessee (1816) that only the high court, not the states, could interpret the Constitution. The decision shocked many Virginians and reawakened their devotion to states’ rights. For example, Thomas Ritchie of the Richmond Enquirer shook off the nationalism he espoused during the War of 1812 and joined Roane in vigorous resistance.

McCulloch v. Maryland, argued from February to March 1819, shocked the Virginians even more. Webster served as a key member of the SBUS’ legal team and argued its constitutionality on the grounds of the necessary and proper clause. In striking contrast to the venal Webster, Luther Martin, the former Antifederalist who heroically opposed the Constitutional Convention’s nationalism, led the states’ rights legal team. The venerable Marylander brought out all the old Antifederalist arguments about the Constitution’s power, combining them with the Spirit of 1798. Martin even quoted Marshall at the Virginia Ratifying Convention when he mendaciously insisted on the limited nature of the proposed government.

Marshall, who sold his shares right before the court case, protected the citadel with his broad constructionism and judicial review. Skirting recent interpretations of the coinage clause (as well as Martin’s damning quote), the Hamiltonian used the reliable necessary and proper clause. Marshall did not merely rule that Maryland could not tax the Bank; he ordained that Congress could enact virtually any desired legislation. The Chief Justice even argued that the federal government was not a confederation of states but a national government responsible only to the people. Thirty years after the Constitution, Marshall’s decision embodied every Antifederalist’s fear—the Constitution had created a powerful and omnipresent empire.

McCulloch v. Maryland struck like a thunderclap. It did not help the central bank’s reputation that right after the decision, investigations revealed the cashier McCulloch as a massive embezzler. To add insult to injury, McCulloch, Buchanan, and Williams never suffered any serious legal penalties. Federalists lauded the court’s decision, but to the rest of the public, Marshall’s ruling and Baltimore’s malfeasance highlighted the SBUS’ egregious privileges. Most notably, John Taylor of Caroline, in Construction Construed and Constitutions Vindicated (1820), declared states’ rights the only recourse to defending liberty from power. One of Taylor’s next works, New Views of the Constitution (1823), took a decidedly neo-Antifederalist turn after the publication of Robert Yates’ Secret Proceedings (1821), which presented a negative perspective on James Madison, the Constitutional Convention, and The Federalist Papers.

Westerners especially heaped scorn on Marshall’s decision. Ohio, where the SBUS previously engaged in massive credit expansion, watched the central bank rapidly foreclose on real estate. The state auditor dismissed the ruling and insisted that the Bank had to pay Ohio’s tax. In 1820, the state legislature even praised “the doctrines asserted by the Legislatures of Virginia and Kentucky, in their resolutions” and the Republican Revolution of 1800. When the SBUS refused to pay, Clay and Webster defended the Bank. In Osborn v. the Bank of the United States (1824), Marshall once again ruled in the Bank’s favor.

Biddle, protected by Marshall, set about making the larger commercial cities “the principal scene of our operations.” In 1823, Biddle arranged for the election of four Philadelphians to the main board of directors, along with four others from New York and Boston. The central banker decided to nationalize the empire’s monetary system and coordinate bank credit expansion through the SBUS’ non-redemption of state banks’ notes and deposits. In 1822, the country’s money supply stood at $81 million, but by 1829 it had increased to $105 million, a 30 percent increase (4 percent per year). The number of state banks similarly increased from 267 to 369. The SBUS spearheaded the inflation, accounting for 64 percent, in addition to granting loans to state banks.

But supporters of liberty did not give up. In December 1827, Virginia’s Congressman Barbour, a Crawfordite Radical, introduced a resolution requesting the government to contemplate selling its SBUS stock. Barbour wanted to pay down the national debt and believed Congress should privatize the institution. Unfortunately, pro-SBUS forces crushed the resolution. Joseph Gales, editor of the National Intelligencer, reassured Biddle, triumphantly proclaiming “this vote as definitely settling . . . in advance” the recharter question in 1836. The next year, Treasurer Richard Rush praised the central bank and its ability to coordinate banknote expansion across the country. Unsurprisingly, Rush hailed from a wealthy Federalist family close to the Girard interests and other Philadelphia elites. His boss, President John Quincy Adams, was Biddle’s friend and a SBUS shareholder.

With the president, Congress, and the Supreme Court on board, it looked as if the National Republicans had permanently fastened the SBUS onto the American economy. They soon turned to other key planks of the American System, enriching new special-interest groups in the process.

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Robert Remini, Andrew Jackson, vol. II (New York: History Book Club, 1998), p. 15 and Robert Remini, Henry Clay (New York: W.W. Norton & Company, 1991), pp. 174, 225.

Donald Adams, Finance and Enterprise in Early America (Philadelphia: University of Pennsylvania Press, 1978), p. 57. 205

American Political Leaders (Washington, DC: CQ Press, 2000), pp. 127, 290; Andrew Browning, The Panic of 1819 (Columbia: University of Missouri Press, 2019), pp. 147–48, 314; John Haeger, John Jacob Astor (Detroit, MI: Wayne State University Press, 1991), p. 201; Bray Hammond, Banks and Politics in America (Princeton, NJ: Princeton University Press, 1957), pp. 231–32, 251–52.

Browning, Panic of 1819, pp. 152–54; Historical Statistics of the United States, vol. 3, ed. Richard Sutch and Susan Carter (New York: Cambridge University Press, 2006), p. 632; Murray N. Rothbard, “The History of Money and Banking Before the Twentieth Century,” in Rothbard, A History of Money and Banking in the United States, ed. Joseph Salerno (Auburn, AL: Mises Institute, 2002), pp. 82–84; Peter Rousseau and Richard Sylla, “Emerging Financial Markets and Early US Growth,” Explorations in Economic History (January 2005): 24; Richard Timberlake, Monetary Policy in the United States (Chicago: The University of Chicago Press, 1993), p. 30.

Browning, Panic of 1819, pp. 314–15; Hammond, Banks, p. 261.

Daniel Feller, The Public Lands in Jacksonian Politics (Madison: The University of Wisconsin Press, 1984), p. 18.

Ibid., pp. 11–12, 18, 20, 22; Sarah Quinn, American Bonds (Princeton, NJ: Princeton University Press, 2019), pp. 25–29.

Joseph Davis, “An Annual Index of US Industrial Production,” Quarterly Journal of Economics (November 2004): 1189; Historical Statistics, 3, p. 181; Historical Statistics of the United States, vol. 5, ed. Richard Sutch and Susan Carter (New York: Cambridge University Press, 2006), p. 80; Louis Johnston and Samuel Williamson, “What Was the US GDP Then?” Measuringworth.com; Remini, Andrew Jackson, 2, p. 42; Rothbard, “History of Money,” pp. 86–89; Murray N. Rothbard, The Panic of 1819 (Auburn, AL: Mises Institute, 2007), pp. 7–14; Timberlake, Monetary Policy, pp. 15, 18–26.

George Dangerfield, The Awakening of American Nationalism (New York: Harper & Row, 1965), p. 86.

Browning, Panic of 1819, p. 183; Historical Statistics, 3, p. 181; Historical Statistics of the United States, Colonial Times to 1957 (Washington D.C., 1960), p. 120; Rothbard, “History of Money,” pp. 88–89; Rothbard, Panic of 1819, p. 20; Rousseau and Sylla, “Emerging Financial Markets,” p. 24; Timberlake, Monetary Policy, p. 30.

William Gouge, A Short History of Paper Money and Banking (Auburn, AL: Mises Institute, 2007), p. 10.

Rothbard, Panic of 1819, p. 16.

Hammond, Banks and Politics, pp. 258–62; Historical Statistics, 3, p. 632; Murray N. Rothbard, An Austrian Perspective of Economic Thought, vol. 2, Classical Economics (Auburn, AL: Mises Institute, 2006), pp. 81–82, 97, 193; Rothbard, “History of Money,” pp. 79–82, 89–90; Rothbard, Panic of 1819, pp. 22–25.

Stanley Lebergott, “Changes in Unemployment,” in The Reinterpretation of American Economic History, ed. Robert Fogel and Stanley Engerman (New York: Harper & Row, 1971), pp. 77–78.

Browning, Panic of 1819, pp. 185–86.

Joseph Davis, “An Improved Annual Chronology of US Business Cycles since the 1790s,” Journal of Economic History (March 2006): 115. See also Johnston and Williamson, “US GDP Then?”

Timothy Terrell, “The Economics of Destutt de Tracy,” in Destutt de Tracy, A Treatise on Political Economy, ed. Thomas Jefferson (Auburn, AL: Mises Institute, 2009), pp. vi–vii.

Rothbard, Austrian Perspective of Economic Thought, 2, pp. 6–8, 11, 37–40; Rothbard, Panic of 1819, pp. 248–49.

Terrell, “The Economics of Destutt de Tracy,” p. xii.

Joseph Dorfman, The Economic Mind in American Civilization, vol. 2 (New York: Viking Press, 1946), p. 514.

Howard Bodenhorn, State Banking in Early America (New York: Oxford University Press, 2003), p. 188.

William Belko, The Triumph of the Antebellum Free Trade Movement (Gainesville: University Press of Florida, 2012), p. 52; Michael Bordo and William Phillips, “Faithful Index to the Ambitions and Fortunes of the State,” in Economists and Higher Learning in the Nineteenth Century, ed. William Barber (New Brunswick, NJ: Transaction Publishers, 1993), p. 49; Norman Risjord, The Old Republicans (New York: Columbia University Press, 1965), p. 252; Rothbard, Austrian Perspective of Economic Thought, 2, pp. 8, 11; Rothbard, Panic of 1819, pp. 193–95; Joseph T. Salerno, “The Neglect of the French Liberal School in Anglo-American Economics,” Review of Austrian Economics (December 1988): 132–33, 141–43; Lawrence White and George Selgin, “Laissez-Faire Monetary Thought in Jacksonian America,” in Perspectives on the History of Economic Thought, ed. Donald Moggridge (Aldershot, UK: Edward Elgar, 1990), pp. 22–26.

Rothbard, Panic of 1819, p. 247.

Ibid., p. 184.

Browning, Panic of 1819, p. 325.

Browning, Panic of 1819, pp. 127, 179, 325; Donald Cole, Martin Van Buren and the American Political System (Princeton, NJ: Princeton University Press, 1984), p. 88; Risjord, The Old Republicans, pp. 229–30; Rothbard, Panic of 1819, pp. 31, 181–85, 190–93, 207, 243.

Rothbard, Panic of 1819, p. 128.

Remini, Andrew Jackson, 2, p. 47. See also Hammond, Banks and Politics, pp. 235–38, 349; Paul Kahan, The Bank War (Yardley, PA: Westholme Publishing, 2016), pp. 31–32; Remini, Andrew Jackson, 2, pp. 43–48; Rothbard, Panic of 1819, pp. 68, 127–31, 202; Sean Wilentz, The Rise of American Democracy (New York: W.W. Norton, 2005), p. 244.

Browning, Panic of 1819, p. 217.

Rothbard, Panic of 1819, p. 202.

Rothbard, Austrian Perspective of Economic Thought, 2, pp. 130–32, 210–16; Roth-bard, Panic of 1819, pp. 115–17, 121, 202–03, 247–49.

Stephen Campbell, The Bank War and the Partisan Press (Lawrence: University Press of Kansas, 2019), pp. 23–25, 60; Dorfman, Economic Mind, 2, pp. 566–97; Leonard White, The Jacksonians (New York: Macmillan, 1954), pp. 290, 293–94.

Thomas Govan, Nicholas Biddle (The University of Chicago Press, 1959), pp. 45, 50–52, 59, 65, 70, 77–78; Robert Remini, Andrew Jackson and the Bank War (New York: W.W. Norton & Company, 1967), pp. 33–34.

Carl Prince and Seth Taylor, “Daniel Webster, the Boston Associates, and the US Government’s Role in the Industrializing Process,” Journal of the Early Republic (Autumn 1982): 293.

Robert Remini, Daniel Webster (New York: W.W. Norton & Company, 1997), p. 262.

Maurice Baxter, Henry Clay and the American System (Lexington: The University Press of Kentucky, 1995), pp. 228, 303–05; Philip Burch, Elites in American History, 1 (New York: Holmes & Meier Publishers, 1981), pp. 104, 148, 169; Prince and Taylor, “Daniel Webster,” pp. 292–93; Remini, Daniel Webster, pp. 261–62.

Hammond, Banks and Politics, pp. 263–64, 266; John Larson, Internal Improvement (Chapel Hill: The University of North Carolina Press, 2001), pp. 123–26; Brion McClanahan, How Alexander Hamilton Screwed Up America (Washington, DC: Regnery History, 2017), pp. 132–36.

Browning, Panic of 1819, pp. 317–18, 328–31; Saul Cornell, The Other Founders (Chapel Hill: The University of North Carolina Press, 1999), pp. 278–94; Thomas J. DiLorenzo, Hamilton’s Curse (New York: Three Rivers Press, 2008), pp. 87–88; Hammond, Banks and Politics, pp. 264–72; McClanahan, Alexander Hamilton, pp. 115–27; Remini, Daniel Webster, p. 165; David Schwartz, “Coin, Currency, and Constitution,” Michigan Law Review (2020): 1019–22.

Thomas E. Woods Jr., Nullification (Washington, DC: Regnery, 2010), pp. 71–72.

Baxter, Henry Clay, pp. 42–43; Browning, Panic of 1819, p. 303; DiLorenzo, Hamilton’s Curse, pp. 64–65; Remini, Jackson and the Bank War, pp. 31–32.

Remini, Jackson and the Bank War, p. 37.

Govan, Nicholas Biddle, p. 79; Historical Statistics, 3, p. 632; Rothbard, “History of Money,” p. 94; Timberlake, Monetary Policy, pp. 29–30.

William Belko, Philip Pendleton Barbour in Jacksonian America (Tuscaloosa: University of Alabama Press, 2016), p. 136.

Ibid., pp. 134–36; Samuel Bemis, John Quincy Adams and the Union (Norwalk, CT: The Easton Press, 1987), p. 197; Burch, Elites in American History, 1, pp. 104–05, 120; Remini, Jackson and the Bank War, p. 34; Timberlake, Monetary Policy, pp. 30–33.