America's first great depression arrived without a villain: no embargo, no war, no single blundering minister to blame. It seemed to rise out of the economy itself.
The Panic of 1819: Reactions and Policies
In 1819 the young republic suffered a crisis unlike any it had faced before. Americans had no settled vocabulary for it. What followed was an extraordinary national argument, carried on in newspapers, pamphlets, and state legislatures, over what had gone wrong and what should be done.
Murray Rothbard recovers that argument in full. He follows the wartime boom and the flood of bank paper that preceded the collapse, then the remedies proposed in its wake: relief for debtors buried under a rising dollar, state-issued inconvertible paper, schemes for a managed national currency, hard-money demands for one hundred percent reserves, and a protective tariff sold as a cure for unemployment. Along the way he documents Americans formulating a monetary theory of the business cycle years ahead of their English counterparts, and he dismantles the tidy sectional story that pits western debtors against eastern creditors.
Narrated by Millian Quinteros.
Preface
A wartime boom, a flood of bank paper, a speculative rush for western land, and then the reckoning.
They borrowed when prices were high and had to repay when prices were low. Should the legislature rescue them, or would rescue only deepen the ruin?
Four western states answered the shortage of money by printing their own, and watched it depreciate in their hands.
Before the Federal Reserve, before the greenback, American writers were already designing a managed national paper currency, and arguing it could be more stable than gold.
Years before the English currency school made it famous, Americans were arguing for one hundred percent reserves, and some wanted banking abolished outright.
Mass unemployment gave the protectionists their best argument in a generation, and they nearly won.
The familiar story pits western farmer-debtors against eastern merchant-creditors. Rothbard's evidence says the story is wrong.
Public works as a cure for unemployment: proposed, debated, and defended with arguments that would sound familiar a century later.
