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According to the Library of Congress, “the history of the New York Stock Exchange begins with the signing of the Buttonwood agreement by twenty-four New York Stock holders and Merchants on May 17, 1792.”1 Presently, and consistently throughout the nation's history, that city remains one of the world's most potent economic powerhouses. Arguably, this success is largely to be attributed, in some fair measure, to the success of the Exchange. What is perhaps less known is that throughout much of American History Louisiana was New York's most persistent competitor for national economic dominance. Specifically, the city of New Orleans, for all its diversity and charm, was the most able rival, and the longest standing. At the time of this writing, however, the economic disparity between the two cities is striking. The population of the city of New York is twice that of the state of Louisiana, which itself holds, in total, more than ten times the present population of New Orleans.2 This gulf can be explained in many ways, but the roots of the matter must be traced all the way back to a very early period, when either city could have confidently asserted its rightful claim to an inevitably prosperous future.
In Louisiana, a prosperous and aristocratic mercantile establishment preceded the development of an inland, agrarian constituency, but the slave-interests of the later became the dominant political concern in the years preceding the Civil War. This sorry transition deprived the state of decades of wealth and prosperity which had been accumulated fairly and humanely by a Whig-ish central relationship between the state and its chartered financial institutions, and disposed of it in service of an abhorrent institution which bore the ironic consequence of also hanging the fate of the state's economy on the fluctuating market-value of a single crop. The state's political and economic futures were effectively taken hostage by a perverse wave of democratic populism escalated secessionists and anti-abolitionists in states like South Carolina, Virginia, and Tennessee, where Andrew Jackson had once sought to govern the whole country from the solitude of his own hermitage.
The principle agent in the evolution of New Orleans, or any other -opolis in American history, was the Bank. Historian Stephen A. Caldwell traced the origin of American banking to 1781: the first bank in the United States was the bank of North America; the first Bank Of the United States followed a decade later, during year of the Buttonwood agreement.3 According to Coleman, it was “organized to provide sufficient quantities of sound currency and assist in financing the government;” it was organized into nine branches and capitalized on ten million dollars; and it “spawned over one hundred banks during the following twenty years.4
The early banking system in America quickly devolved, as all other concerns in the period seemed to do, into a bitter political contest between state and federal control. In Caldwell's telling, much of this hazardous potential could originate with the most carefully thought and well-intentioned policy: “It [the National Bank] had refused to receive notes of state banks who did not readily redeem their issues with specie, and this was probably the main reason why they had all united in opposition to the renewal of its charter.”5 With this opposition, renewal failed, but the effort was taken up again by the National Republicans in 1816. Within eight years, the Whig party dominated Louisiana, whose many internal political fractures were smoothed over by the eroding qualities of prosperity.
For New Orleanians, it was not always so. During the territorial period, Thomas Jefferson described only a geographical abstraction: “The precise boundaries of Louisiana, westward of the Mississippi, though extensive, are involved in some obscurity.”6 According to Alcee Fortier, New Orleans at that period was roughly a third of a square mile in area, containing between “twelve to fourteen hundred houses,” and a population of “nearly ten thousand...including seaman and garrison.”7 The historian observed of the 1793 fortifications that “the bulwarks were defective, could not be defended, and were now in ruins.”8
Until its admission to the Union in 1811, the region and its inhabitants had been hostages to a sequence of diplomatic captivities. Entire generations of French colonists and settlers had been traded away, first to the Spanish, then ceded back again, and then sold to the disaffected progeny of their ancient British nemesis. The governor of the state, William C. Claiborne, had been imported from directly within the ranks of the Virginia dynasty, and had been the face of Anglo government since 1803 when the area now known as Louisiana finally petitioned for statehood. Fortier tells of a “conflict between the rights of the people under the French system of government which Claiborne had affirmed upon assuming the role of Governor.”9 During the territorial period, a “legislative council” divided out “twelve counties” and eventually passed an “Act to institute a University in the Territory of New Orleans in 1805,” in addition to funding for public schools and a library society.”10 Fortier says “To relieve the financial distress, Governor Claiborne established the Louisiana bank, but the people at first had little confidence in the institution.”11
And why should they? The ambiguity with which Jefferson had described those “precise boundaries” might just as readily have been applied to anyone's conception of the future at that time. The old French guard (and their creole offspring), who greatly outnumbered the whites, had little reason to trust anyone, in spite of the nominal concessions which had been made in their favor, such as the temporal “French system of government,” which would receive just enough democracy over the coming decade to elect an Anglo-establishment appointee over a clear French majority. Politics can make for strange bedfellows, as the saying goes, but seldom does it fail in its tendency toward homogeneity.
In New Orleans, this principle was explosive. Claiborne was the prototypical establishment candidate. According to two biographers, Claiborne was born in Virginia, educated at William and Mary, and had even “replaced Andrew Jackson in Congress in 1798!”12 Needless to say, he was no Whig, but he clearly understood the inherent opportunity for a government role in business. On the eve of the War of 1812, the census returned the satisfactory news that the population, now 76,000 officially qualified for statehood under the Northwest Ordinance, which required a minimum of 60,000 residents to apply.13 Claiborne would defeat his successor, Jacques Villere, by an astonishing margin of more than two to one, and enjoyed a 500% advantage among electors in the state legislature.14 Such an outcome itself posed a certain recipe for disaster and war. Fortunately, if strangely, for the unity and continuity of this social gumbo, the war that came was against the British. With it arrived the seeds of a fateful destiny of estrangement and contradiction which this thriving city embodied for all who saw it thereafter. The war brought General Andrew Jackson to New Orleans, leading an army against the British. Such a task required unchallenged control over the city, its people, and its resources.
Eclipsed by the martial authority of Jackson, Claiborne internalized his displacement in the chain of command, thus beginning a lifelong political rivalry between the two, which irreconcilable policies could only aggravate. Appearing on 5 January, 1816, in the Gazette, the departing Governor issued a lengthy public statement in which he decried the conflict of interest in surrendering the state militia to the service of the Union. Though he expressed great satisfaction with the resulting preservation of the city, he said “I shall never cease to believe that [this success] was accomplished and succeeded by a prostration of a part of our laws and civil authority.” A risky move, even for an outgoing public figure, to challenge the political machine that produced him, during a period of popular opposition.
In a far-sighted maneuver of short-sighted political genius, Claiborne averted years of antagonism at home by seizing the opportunity to shift the mantel of Imperial foreign menace to Jackson's shoulders. The biographers referenced above, Walter Cowan and Jack McGuire, had this to say of the political period: “Jackson's ragtag army of U.S. regulars, Tennessee, Kentucky, and Mississippi volunteers, Louisiana militia, free men of color, Choctaw Indians and the Baratarians slaughtered the British in the decisive battle of Jan 8, 1819, [but] the euphoria over victory was clouded by Jackson's refusal to withdraw martial law while the British Fleet remained in the gulf.”15 By thus overstaying his welcome in the perception of the local population, Jackson presented a tangible vision of that Imperial character which Claiborne would relentlessly seize the opportunity to publicly oppose. In so doing, he aligned himself politically with the common interests of those citizens who remained once the domineering military junta finally dispersed.
These interests had been stimulated by the call of statehood, bound and mobilized by the mechanisms of war, and were then faithfully rewarded by the ascent of their own native son to the office of Governor, in the person of Jacques Villere, via the process of democracy. That process was redeemed, as if by providence, for a short-lived but stable and prosperous 'era of good feelings,' propagated by buoyant postwar optimism.
While Claiborne's successor may have better represented the demography, from an ethnocentric point of view, his policies were largely just a continuation of those implemented by his predecessor. Beyond “providing death for the winner of a duel if it was found that he provoked it,” his political contributions centered on improving education and the criminal code.16 Politically ambitious and well placed, his policies did not preclude his splitting the ticket against Henry Johnson in 1824.17 Villere's term, however, was arguably one of Louisiana's most politically turbulent periods. Beginning in 1816, alongside the re-charter of the second Bank of the United States, and enduring recession in the wake of the Panic of 1819, Villere's career trajectory ended in defeat for his party against Thomas Bolling Robertson.
Robertson was a carbon copy of Claiborne, implanted by the same Virginia dynasty, educated at William and Mary, and also a Jefferson Appointee (as land commissioner during the territorial period).18 Not only was his election a solid testament to the political entrenchment of the Anglo-establishment, which was the 'planter minority' which Daniel Webster would later rebuke, but in the words of Cowan and McGuire, “[Robertson's] election brought to the political surface a simmering feeling of competitiveness between established Gallic French forces and the new incoming Americans, a derisiveness which would express itself many times in elections as Louisiana became part of the federal union.”19 Though he would die in Virginia, he would leave behind a “Bank of Louisiana, ...the College of New Orleans, ...and more funding to the Charity Hospital.”20 And though historians tend to agree that his party would have lost the election of 1824 had Jaques Villere not “split the ticket” against Henry Johnson, by then the state had clearly fallen to the National Republicans.
After a few years of political chaos in the state following the election of Andrew Jackson to his first term as president, there was a “showdown in 1831,” to seat Andre Beinvenue Roman, the Creole son-in-law of Henry Clay, in the Governor's office.21 He had moved to New Orleans to aid in the campaign during the period in which historians have him manufacturing a feud between the sitting president and the national bank.22 His successor, Edward Douglas White, the health and stability of the New Orleans economy, and the policies of Andrew Jackson, all managed to collide in spectacular form in 1837, as the result of another major contraction in the credit-money supply following Jackson's Specie Circular. This demanded that government accounts be settled only in specie. The panic which ensued bankrupted thousands of people and ruined dozens of banks. But by this time, Louisiana had established such a firm relationship between the municipal, merchant, and banking sectors that its own internal economy, when taken in the context of its ability to import specie, was able to stand on its own legs.
Here lies one of the many frustrating contradictions in the history of Louisiana Banking during the Jacksonian period. The Whig conception of a national banking system was toxic to Louisiana commerce, but only because the state itself already occupied a commanding role in the establishment and operation of its own banking sector. The state government didn't just establish one bank, however. Application of Whig principles proved so successful and promising that the process of establishing, capitalizing, and subscribing a new bank was repeated over and over again, each new bank piggy-backing off the one before, and sometimes being established just to fund a specific function. What resulted, ironically enough, was a state run collage of what much more accurately resembled Jackson's pocketful of Pet Banks. These only suffered during the encroachment by their national counterpart. If it had not been for the natural strength of the credit-investment economy in New Orleans, this odious relationship with the national banking system would have been just as recusable for other reasons.
To many, the argument for stable national currency was just an elaborate heist, couched in clever rhetoric. Who could oppose roads, canals, and national defense? In truth, the stable (inter)national currency was the Spanish milled dollar, a perfectly weighted silver coin whose relative value at the exchange was the standard by which all other notes and coins were evaluated. 23
Specie was the name of the game, and a bank was any organization that had enough specie to back a sufficient percentage of the notes of credit they issued. Without specie, they ceased to be banks, and became only speculators; and their general imperative was then to advance enough artificial credit to sustain solvency on a volume of interest payments alone. Without sufficient specie to survive a contraction, a bank simply ceased to exist, in which event all of the notes they had issued would be rendered worthless, which they were anyway. Such outcomes could rend entire communities overnight upon the rack of inflation and bankruptcy and foreclosure.
Such was the outcome in 1837, but in 1819, the cause and effect were reversed. In 1837 retraction of credit across the entire banking system nationwide resulted from the widespread suspension of specie payment. In such circumstances, when valueless paper notes, or fiat currency, flooded the exchange, specie would curiously vanish into private hordes, rather than municipal coffers. Jackson's circular created a magnet, calling all the specie home. Those who would refuse this mandate on the grounds of economic castration would have to remove their so called sound-money from circulation, either by demanding their holdings from the local bank, or by demanding their margins from debtors beneath themselves in the credit hierarchy. In any of these cases, as specie became scarce, its relative value would sky-rocket, both in relation to the purchasing power of whatever worthless notes happened to be in circulation, and also in relation to the average values of goods and services on the market.
While the Kentucky Whigs might argue in gilded oratory for the power of a national bank to facilitate a national agenda, what they were effectively arguing for was the sanctioned ability to confiscate the state's supply of specie. Such power was more capable of rendering a state helplessly subordinate to the federal whim than any general of a standing army could ever dream. 1819 was different. In 1837, Louisiana was hard-hit by the crisis, but survived mainly because it had been there before. Nearly two decades earlier, it was not a grand contraction of specie which resulted in economic ruin, at least not in the context of a hostile national banking system. The roots of the Panic of 1819 resembled the Keynesian conditions of artificial prosperity preceding the Great Depression in 1929. During the war, business had boomed. When war production and soldier pay vanished, a beleaguered and poorly regulated national banking system rushed into supplement the demand vacuum, enabling an overextended post-war economy, which collapsed under its own weight.
In simpler terms, New Orleans experienced the negative outcomes of both expansion and contraction; first the former, during 1819, and then the latter in 1837. These were two different panics resulting from two different policies. With this careful distinction in mind, it is then possible to distinguish between the Whig support for the Bank, and the Whig-ish support for a bank. The Jacksonian period may have enabled Henry Clay to perceive New Orleans as allied turf, but he clearly misunderstood the essential character of the New Orleanian, as he mistook it for the inland dependency of his Kentucky constituents, or the imperial merchant barons of New York, or the agriculturally barren Pennsylvania banker. All the condemnations which the state's Whig-puppet governor, Anton Beinvenue Roman, might hurl at a Jacksonian on Henry Clay's behalf in 1831 could just as easily have issued from the mouth of Jacques Villere against the second national bank.
Here, there are lenses through which history may be viewed. To a post-agrarian pedestrian, the “bank” was a generalized term, which, depending on his particular stage of familiarity, might mean anything from an optimistic promise of self-reliance, to imprisonment after default, seizure, and auction. To the merchant class, to whom the industry of banking most properly belongs, the bank was merely a safe storage and a mediator. The bank enabled the merchant to transfer goods to and from any economy, into and out of the local community, and to settle with the local house, and to deposit or withdraw his own specie as his own needs dictate. During the early period, the American adaption of the national model was so degraded, under-regulated, volatile, and under-secured, as to negate whatever advantage it might offer in theory. Moreover, the far more ancient national houses in London and Paris overwhelmingly dwarfed whatever advantage the American national model offered in practice. Therefore, at the end of the day, savvy merchants would have strongly avoided leaving any more of their own specie tied up in those colorful paper notes any longer than it took to conclude business and weigh anchor.
The remaining lens in the hierarchy, after the individual and the merchant, falls upon the bank stock-holder and the politician, mainly because they tended to occupy the same skin. Henry Clay, John C. Calhoun, Martin Van Buren, and a host of others, all come very close to fitting this description, in relative degrees, but Henry Clay especially based his career around these two functions of his political agenda: a)his material benefactors, and b) the policies they desired. For the politician/stockholder, New Orleans was just a shining proof of principle, and a blueprint for the national system, in which the central authority would regulate a unified system of currency and apply credit to stimulate development in critical sectors, in order to generate further capital in the form of revenue from interest on successful investments. Such a system could fund a solid national defense, programs of education, law enforcement, or even an international lending institution to recruit and manage subordinate economies in the states themselves or even in third world countries.
But to let it do so, in New Orleans, would have been to permit the entire existing economic edifice to be demolished, to permit the sudden extraction of specie “up” the chain of command, and to permit the principle agents in local enterprise to be rendered politically impotent by the capricious whims of external forces in Washington, Pennsylvania, or Kentucky, as a matter of national fiscal policy. Under such an arrangement, the constitution becomes effectively worthless as a safeguard of state's rights.
At its inception, New Orleans alone was worth the price of the Louisiana Purchase. Before all the land deals, subsequent states, native-removal seizures, and grant systems which followed, New Orleans provided a readymade economic infrastructure which added dimension and depth to the budding agro-industrial complex, like closing an electrical circuit. In his biopic of Felix Grundy, Joseph Howard Parks set the stage for the city's meteoric, but gentrified, rise to(ward) power: “During and immediately following the war of 1812, the west reached a new height in prosperity.”24 The biographer sketches a rough but adequate framework of the contested imperial mercantile system, in which westward movement is followed by currency (in the pockets of people). The value of land increased, and also the value of cotton, which gave rise to a preponderance of the state's agrarian class, the northern-Louisiana cotton base. Duplex traffic on any of the hundreds of waterways which fed the Mississippi would enrich this intermediary region with settlements and commerce, just as the state's alluvial abundance nurtured the pastoral fields.
However, Parks explained that the “small-scale western farmer couldn't ship directly to New Orleans, which meant they had to ship early to fill their next crop.”25 Herein lay the special power of New Orleans, and once again the explanation acquires an unmistakably organic quality. At the natural common conclusion to all those myriad internal black, brown, and red tributarial trade-routes, “the sale was made to the local merchant, and the banks handled the paper and came in for a large part of the profits.”26 Thus New Orleans was uniquely suited to be the dominant center of power within the state. To subordinate its financial institutions was to subordinate the general will of the legislature.
But this organic relationship was as sensitive to failure as it was to success. Of the suspension in 1819 of specie payments in the Bank of Nashville, Parks explains “by July every bank west of the mountains had suspended specie payment.”27 An edition from the middle of March, 1818, of the Orleans Gazette and Commercial Advertiser featured forty four shipping notices, advertising cargo arriving or passage departing (for goods, services, or people, which often fell somewhere between the first two categories).28 Its counterpart in May of the following year had a third that number.29 This single date point represents a single peak shared by multiple vectors of national economic decline, which can themselves be traced, inductively, straight up that alluvial plain of slow rolling waterways. The figure represents, at once, the decline in pre-harvest imports, which signifies a deficit of disposable wealth in the parishes above, and also a decline in the early shipping crowd trying to get cotton and cane out to markets across any distance.
Observe the difference between two sociopolitical economies. While “Tennessee banks suspended specie payments until 1826,”30 (an ironic year, given its coincidence with the renewal of the campaign to elevate their champion to the presidency; a fine time to release the wealth indeed!) New Orleans rebounded within a single cycle. In the Gazette, in 1820, the number of shipping notices had more than doubled in March, surging as high as thirty-nine a day by late April.31
Such is the stuff of political power. While Tennessee thrashed and bucked in the epic feud evolving between its internal and external systems of commerce, New Orleans barely missed a beat. The political tensions which emerged between Tennessee and Pennsylvania and Kentucky were visible in Louisiana commerce, briefly, but the city itself managed to sustain a massive multicultural hub of deterministic exchange, which implied a naturally advantageous byproduct in the coffers of the local merchant banking system, which then, in turn, the state continuously focused into structural capital investments, driving the expansion of revenue potential.
Hidden in New Orleans was evidence which might ambiguously be used to support either cause in the Jacksonian struggle. In the apparent dissonance between concept and application, the two opposing ideologies merely represented congruent approaches, as distinguished not by any fundamental precept, but only by telescopic variation. The Louisiana system was not different in theory from the Whig model being advanced from then on. The ultimate conflict between the two was a simple question of dominion. In this sense, it may help to think of Louisiana as an independent nation state. The vitality of its port of entry presupposed a degree of political autonomy. In the hierarchy of need, the U.S. Government fell in between that of Louisiana and Tennessee, with the latter occupying the lower rung. The profitability of New Orleans itself was an object of desire to the federal interests, and a quiet one, relative to the nuisance of Tennessee, the presumption of Kentucky, and the preeminence of Pennsylvania.
When the paradox falters, however, it does so in Jackson's favor, but only if the commercial arrangement of the state itself is underwritten by some extant natural advantage. Wherever states are deficient, however, and endure prolonged periods of high import-export ratios, their economies are naturally predisposed to collapse, and will require the “fruits” of a larger more nationalistic Whig system in order to survive. In some cases, they may benefit from modest intervention and fall into harmony within the greater matrices of international trade, but in the long-run, even modest intervention tends to imply massive sums of misappropriated capital, in which government-facilitated channels succeed only in evacuating the vertebral supply of specie into foreign houses.
In Jackson's own words, the offending structure was “an institution...which openly aspires to make presidents and direct and control the destinies of the nation.”32 But this is perhaps an ill-conceived or poorly worded charge, for as the case of New Orleans illustrates, the Bank, when wielded by the state, with proper consideration and consistency (and capital), could also, through its own efforts, affect “the destinies of the nation.” So could the Bank of Pennsylvania. And the Bank of Tennessee. And the banks of New York, Philadelphia, and Kentucky. The difference being that, on the whole, as each opposing party hotly contended, the National bank had the ability to, “through its own efforts,” wreak havoc on the nation as a whole, as a matter of national fiscal policy.
It is clear, New Orleans, though resilient, was not by any means immune to such distress. If New Orleans was the critical nexus in between a vast complex of orbiting economies, then Masepero's coffee house was the central internal switchboard through which the stock and fortunes of broken men passed on to auction. And here also lay the nerve center of a dark and routinely devastating aspect of the Louisiana banking system. Credit matters which became legal matters were usually to be decided by a single district judge, and those judgments executed by the sheriff. In the case of New Orleans, this was Sheriff G. W. Morgan, and his name is replete throughout the Gazette forward, and can even be spotted in the Argus of New Orleans as far out as 1928. On either end of this timeline, Mr. Morgan's role as the lynch-pin in this state-bank government construct is evident. If the coffee shop was the switchboard, then he was its operator. As auctioneer of defaulted securities, his job was to recover bad loans for capricious creditors by putting those products back on the market. To understand, begin with this curious entry on 15 June, 1820, appearing immediately beneath the masthead: “By virtue of an order of the court to me directed will be exposed for sale...10 shares of the stock of the Louisiana Bank seized...” as a result of just one of countless suits brought against debtors throughout the period.33 In these, goods and acreage are purchased on credit by citizens who then themselves default for some reason or another, and the same property goes back to market again. It is possible, if not entirely accurate, to imagine those same tracts of land having been auctioned and seized over and over again for decades, ad infinitum, from then until the present day, each single quarter-acre generating a potentially unbroken chain of revenue over the course of centuries of mortgage-and-default.
It was a kind of cannibalistic shell-game in which countless lives were consumed as a matter of probability. For each single debtor that beat the odds and won enough times to establish his own firm, dozens of others found themselves standing penniless before the Man. Many of the lots, on the other hand, remained relatively unchanged, unaffected, and unconcerned, for decades after Mr. Morgan surely descended from the call box. The Marshall of the Louisiana District serving a similar capacity in 1818 was M. Reynolds. His first mention in the 15 June edition of the Gazette is a testament to the already-arbitrary quality detectable in the New Orleans credit economy: “The U.S. Vs one bale blankets marked No. 62.” (wait!) Herein, the Marshall summoned “all and every person having or pretending any right, title, or interest [in said bale]” to appear to “shew cause why said bale of blankets should not be condemned or forfeited to the United States...for a breach of the revenue laws.”34 One assumes this call went unanswered.
Mr. Morgan's name appears three times in the same issue, and not consecutively. Among his vaunted wares are “a negro male,” and five lots of land. The origins of these auction items included only a single civil suit, an estate sale, and, of course, the desire of and enslaved man to be free.35 The following year, by the 9th of July, (Mr. John Nicholson having apparently assumed the role of M. Reynolds) the Sheriff and the Marshall found themselves entrenched! On that day, Mr. Morgan's name appears five times immediately beneath the masthead, pushing more than fifteen lots.36 On the same day, however, the Louisiana Bank announced a 5% dividend for its stockholders.37 This institution had been chartered the previous year, on the 23 of March.38 By 16 August, Mr. Morgan featured six entries, now including among the lots and slaves entire inventories of cargo and merchandise, such as “262 barrels of pilot bread” and a quantity of millinery, consisting of Chip hats, Turbanes, Frills, purses, combs, etc.”39 Such pace held consistently into December, with mortgages, inventories, and now entire ships and their manifests topping the auction block; and the name J.B. DeBruy gaining notability for its persistent presence among these threads.
The proceedings of the 2nd Bank of the United States in Philadelphia were front page news, another emerging trend in the Gazette to be echoed by later publications in similar periods of turmoil. New from Philadelphia, November 19 included sections of the Report of the Committee to the Stock-holders of the Bank of the United States. In it, it is reported that “In the city of Philadelphia, the local banks have received from the parent 1,150,972 dollars in specie more than they have put into it.” The report continues to inform the general public that “the balances due to it by the local banks amount to 2,502,658 dollars.”40 “Numerous state banks,” a commentator asserts in response to this passage in the 23 December issue of 1819, “have failed, and...those in Philadelphia are much in debt to the bank of the United States, and must soon be broken if they aid the merchants to pay their duties to the government.”41
Following this article in the Gazette, lies a curious lagniappe, to which many readers attention were probably more readily drawn. Its tag-line merely read “Execution, Resuscitation.” In this article, a man, C. L. Bennett was allegedly executed in Franklin Tennessee in November for the murder of William T. Hay. Afterwards an attempt was made “by the faculty” to resuscitate the man, the results of which were scandalous!
“Many was the ear that was tickled to ecstasy by hearing him breathe through the keyhole;” while others “saw him cross his legs, ...kick, ...and oh! For shame ghost, you were seen to dance to the tune of Nancy Dawsen, and ever and anon, you brandished a brandy bottle, which you swigged, then laughed, then swigged again, to the prejudice of all good ghosts.”42
Regardless of its Tennessee origin, a richer and livelier metaphor could not be tailor-made for the New Orleans recovery than the sordid tale of C. L. Bennett. But the shambling corpse which galloped back into prosperity in 1920 was strikingly different from that rosy cheeked optimist which had gone into the bubble the year before.
As early as March, the ships were waiting to carry cargo out to Liverpool, New York, Boston, and Havana.43 Inbound merchandise included fresh stock of beef, butter, cider, tobacco, wheat, and even goods from China.44 Mr. Morgan was still hard at work with more than fifteen lots, six bales of cotton, and a whole schooner up for bid, according 29th of March edition of the Gazette. The shipping bills exceeded 40 per issue by the end of April, but by May, Mr. Morgan's trade had grown to include children as well.45 An entry on the 15th of that month reads “To be exposed for sale,” and what follows is a declaration of indentured servitude involving a Mr. George Hick. The “property” is a “seven year old negro girl,” exchanged in lue of remittance: “Ten Dollars.” Reward for errant adults, if retrieved and returned alive, generally ranged around thirty dollars. Two of these and two children, therefore, represented a combined value equivalent to that of a hundred acre parcel, as distributed by the federal government, prior to speculation. Consider the extraordinary suggestion of wealth which owning forty acres of land represented, then or now, and then consider that owning forty slaves was tantamount to owning as much as two thousand acres, or more. For comparison, Universal Studios in Orlando Florida occupies an 840 acre complex.46 Such was the fluidity of the concept of “currency” in a mercantile environment.
In June, shipping density had weakened; both inn-bound and outbound traffic were subdued. The Catholic churches conducted lotteries to construct a cathedral, as it had done for a college. Mr. Morgan's entry now consumed an entire column, offering shares of the Louisiana State Bank, slaves, lots, and 42 hhds of sugar.”47 By then, none of the creditor’s names in one issue appear in the next.
In 1828, the editor of the New Orleans Argus was John Gibson: “State and City printer and publisher of the Laws of the United States, by authority.”48 The 27 August edition of the Argus was more robust, now six columns! In fine, small typeset immediately beneath the masthead are now notices of exchange, instead of exposure for auction. After the barrage of entries announcing rewards for the return of runaway slaves (by now an epidemic problem, judging by the frequency), these entries densely punctuated with sale offers for imported or exported goods including cast iron pianos and imported prayer books, the section “Detained in Jail” begins.49 Immune to no lucrative pursuits, the law now dealt extensively in the trafficking of human property. Runaway slaves were captured and returned to the jailer, who then submitted public notice to inform the owners.
Bonnabels Apothecary at 177 Tchoupitoulas street offered “mineral water... to ward off the Dengue.”50 G.W. Morgan now conducted business at the “Exchange coffee shop” (located on the corner of Chartres and San Louis.)51 Shipping bills for the period reflect active trade with St. Louis, Baltimore, Charleston, and the Cuban isle.52 At the end of September, Gibson still operated the Argus. Exchanges on New York, Philadelphia, Boston, and England preceded dense columns of even smaller typeset, now almost exclusively devoted to trade, and such cosmopolitan-isms as “French Paper Hangers, Lime juice...” with larger staples such as sugar and coffee arriving in enormous quantities: “Two hundred boxes of white Havana sugar,” and “30,000 pounds of fresh coffee” from Cuba, also.53 Henry Johnson was the governor and P. Derbigney was Secretary of State. 54
Politically, the news of Philadelphia was surprising to some, that its electors favored Jackson over Clay. But to others, this outcome had been obvious and predictable. “The Jacksonians must be very hard run for something to raise their sinking courage, when they crow so much about the hard-won victory they pretend to have gained in Pennsylvania and Philadelphia more than any other part of the state, yet we find upon close examination that their victory in the very hotbed of Jacksonian-ism is owing to the most fortuitous of circumstances.”55 Sixty-eight words which translate simply: “Jackson got Lucky.” The New Orleanian could see it no other way. The opposition lamented “the conduct of the Jackson party after victory is disgusting...”56 During election season, the pundits, often anonymous or writing under a pseudonym, waxed poetic with self-assurance, “But we have not great reason to believe that should they elevate their IDOL to the Presidential Chair, that peace should be driven out of the country.”57
Notably, the Argus operated a bilingual press, with an entire French transcript of each English issue appended to it. In 1828 and 1832, its principle commentators or syndicates were vocal supporters of “Our Hero” Henry Clay, who had little but disdain for Jackson, himself not only, but of the general stock of humanity which he represented in the abstract. A half a column in September of 1832 explores the charge (by implication) that Britain, in pursuit of her own Imperial interests, had invested in the Jackson campaign.58 Such charges were not unwarranted and were rarely withheld. This one pegged Martin Van Buren as the critical link, “playing upon the old Hero's weak point by flattering attention to Ms. Eaton...” with the object of “gaining a peace of Maine and establishing communications with Halifax and Quebec.
The charge is ironic, also. According to Joseph Wechsberg, the Louisiana Planter's association had been financed in 1829 by the Barings family, one of a prominent league of English merchant bankers located in London, and that this had been “the first loan placed for a North American state.”59 After thirteen years, the British already had their fingers knuckle-deep in the southern pie. “Loans for Maryland and Massachusetts followed.”60 Whatever its political impacts may or may not of been, their efforts would not survive the decade. The historian continues, further on, describing “the lean years between 1839 and 1842 when Maryland and Pennsylvania defaulted on their interest payments. American credit was so low in the city [London] that no-one wanted to touch American securities.”61
The author refers to the period leading up to this as the “Belle-epoque,” the period in the early nineteenth century in which the major families in the world of “merchant banking after 1815, when the Barings, the Rothschilds, the Schroders, the Hambros, the Lazards, were the world's most powerful bankers.”62 Of this period, Wechsberg also mentions that “from 1815 to 1830, at least three bankers had failed every year.”63 Relating an article from the American press, Wechsberg quotes “The times said that Anglo-American bankers were a curse to both the United States and England by inducing the poor states to contract debt.”64 The Barings may have suffered during the period, but other English merchant bankers would prosper from investing in American growth. Among the notable example from the nineteenth to twentieth centuries are the Warburgs, who financed the Union Pacific; the Lehman Brothers, who, after fighting for the confederacy moved to New York to sell Cotton; and of course the “First Jewish Family,” the Rothschild, financier mejor from the Napoleonic wars to World War One.65
Historian and unwitting sociologist Roger W. Shuggs examined what became the title of his work: “Origins of Class Struggle: a Social History of White Farmers and Laborers During Slavery and After, 1840-1875.” Of Louisiana's extraordinary alluvial abundance, Shuggs explains that “such rich soil could only be profitably exploited by only rich planters. It early brought prices beyond the reach of new comers without plenty of capital.”66 As a result, the author argues, the land “required so much negro labor...” that it “became the seat of slave plantations.”67 In spite of annual outbreaks of yellow fever, two major outbreaks of cholera, about a half dozen nearby wars, and an aggressive international banking cartel trying to shoulder out the competition during a formative period in the nation's history, New Orleans thrived and prospered. But the divisions between class, ethnicity, and even geography, still constituted major fault-lines within the state, which persisted even into the following centuries.
Of their northern competitors, John Crosby Brown writes “After the war of 1812-1815, the construction of canals in the states of Pennsylvania and New York led to the concentration of growth and business in New York.”68 To the credit of both cities, they each maintained an unbroken sequence of sea trade which operated like the opposing chambers of a heart. One side pumped goods and services to and from the other, filling all the arteries, veins, and capillaries in between with supplies. Paroxysms on either side of the system could deflate or swell the economic activity of the other.
Returning to the chronicles of Alcee Fortier, “On January 1 1817, a branch of the Bank of the United States was opened in New Orleans, and in 1818 the State bank of Louisiana was established with a capital of two million dollars.”69 “Insolvent debtors could escape imprisonment,” the historian explained, “by abandoning all his property to his creditors; but the fraudulent bankrupt was incapable of occupying a place of honor or profit.”70 The state had, in fact, paid off its own debt by 5 January, 1820. The Louisiana State Bank and the Consolidated Association of the Planters of Louisiana followed in 1824 and 1827, respectively.71
Speaking in 1833, Governor Roman proudly declared that “the Union Bank, has succeeded in preventing the disastrous results that might have followed the withdrawal of large sums of money by the Bank of the United States.”72 As recorded by Altier, “the banking capital [in Louisiana] at the end of 1832 was $25,873,420” Speaking nine years later, the same governor “says the solvency of the Banking Institutions of Louisiana is so well established that the notes they issue, although not redeemed in specie, are at a discount of hardly two percent.”73 Furthermore, “Their paper is in such demand throughout the state, and forms very nearly the only circulation of a neighboring state.”74 In 1841, however, the old 1819 model arose once again. “The banks suspended specie payment and there were great financial difficulties.”75
Governor Roman, being the son-in-law of Kentucky Senator and dynastic Speaker of the House Henry Clay, opposed the Jacksonian platform as a party Whig, but in truth, the Jacksonian premise, that the National Bank was destructive and corrupt, could not be denied. But then, to the Whigs, the turbulence between 1837 and 1842 was vindicating. The absence of a national bank was also damaging and perhaps more conducive to corruption, but in this mode, Louisiana was far better off than under the national system. So eventually, for the New Orleanian, the political conflict simplified into two intolerable conceptions of external control: the Pennsylvania carrot or the Washington stick. Neither was preferable to the other in a region that identified with cultural autonomy, suspicion of foreign control, and a symbiotic relationship between administration and finance. In essence, both the Jacksonians and Whigs each representing a disenfranchising hermitage to which Louisiana often seemed an unwilling tenant.
True, Louisianians had taken great pride in their admission to the Union; and also, circumstances invariably dictated a marginal presence at best of heartfelt Anglo- or Franco-philia, in spite of their own disparate heritages. Roman himself aligned with Jackson in his opposition to the principles of nullification, even as his own state seemed solidly Whig. (It wasn't!) These repeated failures at the national level, however, eventually caused Louisiana to retreat, after 1842, into its own democratic skin. The controversial issue of slavery; the continued fiscal overreach of the federal government, which reduced tariffs in1842, exposing the sugar market to dominant foreign competition; and the fading influence of Henry Clay, all were factors which can explain Louisiana's shift. Their own model of internal management had served them well; but the schizophrenic give-and-take of Washington log-rolling was maddening and irrational, and it was rarely ever as firmly based in substantive policy as it was based in self-interested ambition and party rivalry.
Louisiana's self-interest lay at home, not in building Kentucky roads, nor in outfitting the Charleston fleet. But this too was a contradiction couched in superficial rhetoric. Louisiana chose the union in 1811, and did so again during the Mexican war. Choosing the Confederacy may have been the natural choice once the Civil War arrived, but even in that context, Louisiana was still just angling to be a part of a Union, if not the Union, where its relative power status would be elevated in the absence of New York, Pennsylvania, or, for a period, Kentucky. In that context, New Orleans was well-placed to assume Whig-style role in the emerging confederate infrastructure, while preserving its sovereignty on the crucial issue of slavery.
In truth, Louisiana sugar planer's had surely benefited from the protective tariff, as the policy had intended, but what else could have kept the state's agrarian slave-owners supporting the Union once that barrier to foreign competition was removed? In the end, the excess duties on other goods, such as wool and iron, took money directly out of the hands of the local traders and merchant houses. As well, the business of supporting the planter base was a role no less suited to Louisiana banks than to those in Pennsylvania, Tennessee, or even London. So long as the cotton grew, the state could establish its own protective measures as it saw fit.
Somewhere between the theory and the practice, reality intervened, however. The premise that Louisiana could stand upon its own merit in finance was incontestable. The premise that the Louisiana banking system could accommodate and manage ten other states, each full of illiterate, poor, single-cropping dirt farmers, while simultaneously operating a wartime military complex, under fire and blockade, was absurd. But rarely has anyone's concept of glory ever been especially well reasoned. Arguably, this is why Roman had opposed nullification. He had seen the bigger picture. The early hard-liners and their secessionist offspring had only succeeded in clouding the issue, prohibiting a sensible solution, and courting disaster. There is a reason why the Lehman Brothers moved to New York to sell cotton after the war. Alabama was broken, as was the rest of the south!
Concurrent with the condition of Union are the necessities of cohesion and vulnerability. The twenty-first century Iraq War began when a group of people began deliberately underselling a single product. The twentieth century Iraq War began as a consequence of one group of people deciding to withhold the same product from the world market. Oil and money are the same thing, just as silver coins and bank notes are the same thing. In a very real way, all of these wars have been about the same thing, which has so many faces it appears complex. But what all of these terms-money, oil, silver, promissory note, dollar- have in common is trade value. Too much or too little of any one thing, at some point, becomes destructive. Too much Union is conformity. Too much credit is insolvency. Yet too little of either results in anarchy and stagnation, respectively.
The story of antebellum Louisiana is a fifty year voyage into and out of (and back into) indentured servitude. The generations of French are like the procession of tree rings. At the core, the language, the shared history, and the common necessity, all lay neatly wrapped in season after season of white migration, black importation, and economic tension. What institutions the Americans established were not themselves especially new or novel, and in time the even the French came to call them their own, for the same reasons a rising tide lifts all ships. But with these institutions of prosperity came an inherent cost, an implied sacrifice which was by no means mutual, but by all accounts might have been mutually beneficial, had a stronger basis of trust been established. The system required trust in order to function, and after a point, good faith between the two sides was in profoundly short supply.
Jackson had muddied these waters at the very start, but a bigger problem was that the system did not merely depend on trust alone, but also required enormous vision, inexhaustible competence, and extraordinary patience as well! Such leaders were in equally short supply. The biggest problem, though, was that surrogate which nature alternatively provides: an abundance of rash, short-sighted, and corner-cutting men who follow only their own interests and will willfully bind the machine to exact their own ransom. These men were drawn to trade as moths to a bright light. They would consume the south. The French had been ceded and sold; the Americans themselves owned people. In such times, among such people, it becomes unclear where the line lies between property and person-hood. In such cases, the best terminology is genteel. Indeed, Louisiana, had become what Felix Grundy might once have described as a tenant of the Hermitage.76
Image Source: http://cdn.history.com/sites/2/2013/11/battle-of-new-orleans-H.jpeg
1 Library of Congress, Business Reference Services. History of the New York Stock Exchange. October 2012. https://www.loc.gov/rr/business/hottopic/stock_market.html (accessed 25 March 2016).
2 Census Bureau, “Quick Facts: New York city, New York” and “Quick Facts: New Orleans, Louisiana” http://www.census.gov/quickfacts/table/PST045215/3651000 and http://www.census.gov/quickfacts/table/PST045215/2255000 (accessed 21 March 2016).
3 Stephen A. Caldwell, A Banking History of Louisiana. (Baton Rouge: Louisiana State University Press, 1978), 1-3.
4 Ibid.
5 Ibid.
6 Alcee Fortier, History of Louisiana: 1803-1861. Vol. III, 3.
7 Fortier, History of Louisiana: 1803-1861. Vol. III, 4.
8 Ibid.
9 Fortier, History of Louisiana: 1803-1861. Vol. III, 16.
10 Fortier, History of Louisiana: 1803-1861. Vol. III, 21.
11 Ibid.
12 Walter G. Cowan and Jack B. McGuire, Louisiana Governors: Rulers, Rascals, and Reformers. (Jackson: Mississippi University Press, 2008). 57-61.
13 Ibid.
14 Fortier, History of Louisiana: 1803-1861. Vol III, 57-59.
15 Cowan and McGuire, Rulers, Rascals, and Reformers. 61.
16 Cowan and McGuire, Rulers, Rascals, and Reformers. 63-64.
17 Ibid.
18 Cowan and McGuire, Rulers, Rascals, and Reformers. 65-66.
19 Ibid.
20 Ibid.
21 Cowan and McGuire, Rulers, Rascals, and Reformers. 70.
22 Ibid.
23 United States Mint, Timeline of the United States Mint, https://www.usmint.gov/education/historianscorner/?action=timeline (Accessed 25 March 2016).
24 Parks, Felix Grundy: Champion of Democracy, 103-105.
25 Ibid.
26 Ibid.
27 Parks, Felix Grundy: Champion of Democracy, 105.
28 Orleans Gazette & Commercial Advertiser, Vol. XV, New Orleans: Peter K. Wagner (Publisher), 23 March, 1818.
29 Orleans Gazette & Commercial Advertiser, Vol. ukn, New Orleans: Peter K. Wagner (Publisher), 20 March, 1819.
30 Ibid.
31 Orleans Gazette & Commercial Advertiser, Vol. ukn, New Orleans: Peter K. Wagner (Publisher), 29 March, 1820; and 28 April, 1820 .
32 Parks, Felix Grundy: Champion of Democracy, 226.
33 Orleans Gazette & Commercial Advertiser, Vol. ukn, New Orleans: Peter K. Wagner (Publisher), 15 June 1820.
34 Orleans Gazette & Commercial Advertiser, Vol. ukn, New Orleans: Peter K. Wagner (Publisher), 15 June, 1818.
35 Ibid.
36 Orleans Gazette & Commercial Advertiser, Vol. ukn, New Orleans: Peter K. Wagner (Publisher), 9 July, 1829.
37 Ibid.
38 Orleans Gazette & Commercial Advertiser, Vol. XV, New Orleans: Peter K. Wagner (Publisher), 23 March, 1820;
39 Orleans Gazette & Commercial Advertiser, Vol. ukn, New Orleans: Peter K. Wagner (Publisher), 16 August 1819.
40 Orleans Gazette & Commercial Advertiser, Vol. ukn, New Orleans: Peter K. Wagner (Publisher), 23 December, 1819.
41 Ibid.
42 Ibid.
43 Orleans Gazette & Commercial Advertiser, Vol. ukn, New Orleans: Peter K. Wagner (Publisher), 29 March, 1820.
44 Ibid.
45 Orleans Gazette & Commercial Advertiser, Vol. ukn, New Orleans: Peter K. Wagner (Publisher), 15 April, 1820;
46 MM_Universal.Pdf, The Wizarding World of Harry Potter: Universal Orlando Resort meetings and Event, 2010, http://www.occc.net/pdf/MM_Universal.pdf (accessed 25 March 2016).
47 Orleans Gazette & Commercial Advertiser, Vol. ukn, New Orleans: Peter K. Wagner (Publisher), 16 June, 1820;
48 New-Orleans Argus, Vol. Fifth, No. 904, New Orleans: John Gibson (Publisher) 27 August, 1828.
49 Ibid.
50 Ibid.
51 Ibid.
52 Ibid.
53 New-Orleans Argus, Vol. Fifth, No. 961, New Orleans: John Gibson (Publisher) 1 Novembr, 1828.
54 Ibid.
55 Ibid.
56 Ibid.
57 Ibid.
58 New-Orleans Argus, New Orleans: John Gibson (Publisher) 29 September, 1832.
59 Joseph Wechsberg, The Merchant Bankers, Boston: Little, Brown and Company, 1966. 124-125
60 Ibid.
61 Ibid
62 Wechsberg, The Merchant Bankers, 26.
63 Wechsberg, The Merchant Bankers, 51.
64 Wechsberg, The Merchant Bankers, 126
65 Ibid.
66 Roger W. Shugg, Origins of Class Struggle: a Social History of White Farmers and Laborers During Slavery and After, 1840-1875, Baton Rouge: Louisiana State University Press, 1968. 5-6.
67 Ibid.
68 John C. Brown, A Hundred Years of Merchant Banking, New York: Arno Press, 1978. 21.
69 Fortier, A History of Louisiana: 1803-1861, 185.
70 Fortier, A History of Louisiana: 1803-1861, 202.
71 Ibid.
72 Fortier, A History of Louisiana: 1803-1861, 221.
73 Fortier, A History of Louisiana: 1803-1861, 230.
74 Ibid.
75 Ibid.
76 Parks, Felix Grundy: Champion of Democracy, 242.