CHAPTER XXXIV DEMOCRATS VERSUS WHIGS, 1837-1845 A number of circumstances have combined to give Martin Van Buren a low rank among the presidents of the United States. As the choice of Jackson he incurred the bitterness of the Whigs, many of whom were in a position to give wide publicity to their views. As one of the pioneer national spoilsmen he has long been anathema to the reformers. As a machine-made president he entered office with little popular support, and as chief executive during a severe "panic" he was held responsible for the period of hard times. Under that handicap it would have taken a genius to achieve success, and Van Buren was no genius. He was, however, a courteous, affable gentleman, and a man of considerably more than the average education and ability. His misfortunes were the product of forces beyond his control, although he and his predecessor may have been partly responsible for shaping some of those forces. THE PANIC OF 1837 The outstanding feature of Van Buren's single term was the Panic of 1837, one of those serious economic crashes which have occasionally tormented the country. In dealing with a panic it is very easy to describe the symptoms, much easier than to explain the causes. Banks failed, business men failed, manufacturers failed; farmers saw their lands sold under foreclosure, voters saw the state governments refuse to pay their debts, some of which were repudiated entirely. The federal government saw its revenues shrink from an embarrassing surplus to a very troublesome deficit. A small part of the difficulty may have been due to the fiscal and banking policy of the Jackson administration. There is no doubt that the placing of public funds in local banks and the distribution of the surplus revenue gave a great impetus to speculation. Everybody was buying something or investing in something. In New England money was put into new factories, in New York into factories, com merce, and transportation, in the Middle West into farms and transportation, in the South into cotton culture and slaves. This was the period of great transportation schemes, when the canal was just beginning to feel the competition of the railroad. States which had mortgaged the future for years ahead to build canals had to begin over again and repeat the process with railroads. Because the actual volume of money available was nearly fixed, most of these new enterprises, East, West, and South were financed on credit. Because of the demand for credit, interest rates were high, so high that the American commercial centers were constantly attracting money from abroad. By 1836 the United States, as a community, was heavily in debt to Europe. The difference between speculation and sound business is in many cases like the difference between heat and cold, one of degree, not principle. Sometimes the business world can carry for years at a time a high superstructure of credit without any difficulty; moreover a country may pass from a policy of retrenchment to one of extraordinary speculation and back again without a panic. Again, as in 1837, the period of prosperous expansion may be cut off by a sudden collapse. What makes the difference has never been entirely clear. Men whose ventures are carried off successfully within the period of prosperity are described as geniuses, builders of wealth; the same men, doing the very same things a year later are miserable speculators, parasites upon society. In 1836, there had been enough money in circulation to sustain a vast volume of credit. In 1837, the same circulating medium was not sufficient to carry anywhere nearly the same amount of credit. No one has ever explained satisfactorily why the break came. One thing is certain, that the causes of this panic were not local. The difficulties were world-wide, and to all appearances, the first signs appeared in Europe. English bankers at the same time had financed English factories, American canals, and various other enterprises. Americans, either as corporations or as state governments, had borrowed nearly $2,000,000 from English creditors. They in turn had borrowed heavily in Europe. When the European lenders began to demand payment, the English bankers were obliged to call in their loans. At the very time of these demands, funds were needed in America to finance the speculations in cotton lands, wheat lands, and canals. The extended credit could not be converted into cash THE CAMPAIGN OF 1840 373 for years to come, and the sudden call for payment meant failure for bank after bank. In attempting to account for the unexpected and widespread demand for funds, which precipitated the panic, Professor Channing suggests the possibility that the little understood forces of nature, expressed in climatic conditions, may have been responsible. A world-wide decline of agricultural production may have given the initial impetus. It is also possible that purely psychological factors may have started the collapse. The successful conduct of business on credit depends upon confidence, and confidence is easily upset. Human beings are still primitive enough to react quickly and irrationally to the instinct of fear, frequently without being able to tell what inspired the fear in the first place. Once aroused, fear will rush through the commercial world like fire through a barn full of hay. While foreign creditors were insisting upon an immediate settlement, the American wheat crop failed, so completely that farmers were compelled to buy seed abroad for the next year. Cotton, which had been selling as high as twenty cents, dropped to ten Flour went to twelve dollars a barrel, a price almost unheard of previously, while wages declined or stopped entirely. Before the autumn of 1837, every bank in the country stopped paying specie. By the following spring there were signs of recovery, but confidence and good business were not fully restored until 1840. Van Buren's remedy, designed however to operate in the future rather than for the immediate present, was the so-called independent treasury system, under which the funds of the government would be entirely separated from the business world. Under this plan all money received would be deposited in the treasury at Washington, or in various "sub-treasuries" to be established in certain selected centers. Because of opposition in Congress, the President's measure was not enacted until 1840. In 1841, the Whigs repealed it, but in 1845 the law was reenacted. The independent treasury lasted until 1914, when it was superseded by the Federal Reserve System. THE CAMPAIGN OF 1840 While Van Buren and the administration party were struggling with the accumulated financial embarrassments created by the panic, Clay, Webster, and John Quincy Adams devoted their talents to perfecting the Whig organization. Nothing is quite so good for the opposition party as a panic. The voters can be easily made to fasten the whole responsibility for it upon the administration in office. With that idea firmly implanted, they proceed to take vengeance in the next presidential election. From 1837 to 1840 the Whig leaders ridiculed the financial policy of Jackson and Van Buren, and called upon the people to save the country by putting in the Whigs. Historians have never found very much in that party to justify popular confidence. It did have great leaders, one of whom had been president, while two others, Clay and Webster, spent their lives in a vain race for that honor. But the Whigs were still the unfused, widely divergent factions of 1836, united neither upon leaders nor upon principles. The local chieftains were noted for their loud-spoken denunciation of the Democrats, for their deep-seated desire for federal jobs, and in many cases for little else. The Whig convention met at Harrisburg in December 1839. Unable to agree upon any constructive program, they were as a consequence unable to nominate any one of their great leaders, who were all of the National Republican school, believers in a bank, a protective tariff, and in internal improvements. Passing over them, because their attitude was well known, the convention nominated William Henry Harrison, one of the few generals who had come through the War of 1812 with any credit. Aside from his military career, his chief asset was the widespread ignorance within the party concerning his political views. For Vice-President they selected John Tyler, a Virginian, a follower of Calhoun, and a Democrat in everything except his attitude toward Jackson. With a frontier military hero for their candidate the Whigs were able to conceal their own irreconcilable differences and their want of a platform by campaign methods new to the United States. Log cabins, raccoon skins, and hard cider became the symbols of the party, and with these as a means of appeal the party leaders aroused unprecedented enthusiasm among the voters. Processions, banners, and all the paraphernalia for reaching the emotions became the order of the day. For the first time a presidential campaign was turned into one long, joyous, hilarious uproar, in which any sensible discussion of issues would have been as foreign as fish in a desert. The result showed that the people liked the innovation, in spite of, perhaps because of, the cheap claptrap. Harrison won, with a substantial majority, and an electoral vote of two hundred thirty-four to PRESIDENT HARRISON 375 his opponent's sixty. The total popular vote was nearly a million more than that of the preceding election. Disgusted as they were with the outcome the Democrats could not deny that their opponents had distinguished themselves by their campaign methods. PRESIDENT HARRISON On inauguration day, Harrison was duly installed in office, in the midst of enthusiastic applause, furnished in large measure by the swarms of office-seekers who poured into Washington. These faithful followers crowded the streets and filled the boarding houses, while some even slept in the doorways of the White House. In the meantime the new President, a man of seventy years, was entirely in the dark as to his place in the new dispensation. Able in military affairs in his younger days, clever and tactful in dealing with office-seekers, he had no comprehension of policies or methods. Consequently for advice and help he turned to Henry Clay, who was more than any other man the leader of the party. Clay selected the Cabinet, and drew up the legislative policies. Congress was called for a special session, primarily to repeal the Independent Treasury Act, to reestablish a bank, to enact a higher tariff, and to provide for internal improvements. Some of these policies were popular in the East, some in the West, but the southern Whigs disapproved of them all. Within a month after his inauguration, and nearly two months before Congress met, Harrison died. Tyler, his successor, disapproved of every single feature of Clay's program. PRESIDENT TYLER Congress passed a bill for a bank, which the President promptly vetoed. A second met the same end, and eastern Whigs stigmatized the President as a traitor. Clay's internal improvements plan, based on a scheme to distribute the proceeds of public land sales among the states, was so altered that it was worthless. Stung by his failure to command the executive and to direct the policies of the administration, Clay advised Tyler's Cabinet to resign. All the members did so except the Secretary of State, Daniel Webster. The common explanation of his refusal to follow his colleagues into private life is that he was then engaged in a series of delicate negotiations with Lord Ashburton, the British minister to the United States. The problems were then in process of solution, and Webster did not wish to jeopard |