Empire of Liberty: A History of the Early Republic, 1789-1815

by Gordon S. Wood

  It was the proliferation of these state-chartered banks and their issuing of notes that enabled the states to have paper money after all—despite the Constitution’s prohibition in Article I, Section 10 against the states themselves issuing bills of credit.61 Indeed, since, unlike today, the federal government did not issue any paper money, without these increasing bank notes (that is, credit) the society could never have commercialized as rapidly as it did. By 1815 over two hundred banks had deposits and note liabilities of about $90 million backed by only $17 million of specie.62 In 1808 the Farmers’ Exchange Bank of Gloucester (now Glocester), Rhode Island, emitted over $600,000 in paper; it had, however, only $86. 45 in specie to support these notes. This was too much, even for Rhode Island, which had a notorious reputation for excessive paper emissions or loose credit; and in 1809 the state legislature closed the bank, making it the first bank to fail in United States history.63

  The American economy floated on paper. “The circulation of our country,” Senator James Lloyd of Massachusetts declared in 1811, “is at present emphatically a paper circulation; very little specie passes in exchange between individuals.” With this extraordinary multiplication of banks, entrepreneurial farmers in the backcountry had the money and the sources of credit they had long desired, and the agrarian unrest that had troubled the rural areas in the aftermath of the Revolution tended to subside. Indeed, Americans had created a modern financial system that was the equal of any in the world. According to two economic historians, the United States in the early nineteenth century became “history’s most successful emerging market, attracting the capital of investors in older nations seeking higher returns.”64

  REPUBLICANIZING THE BANKING SYSTEM may have become important to Jefferson, but shrinking the debt was far more crucial: it went to the heart of the Republicans’ conception of government. Precisely because Hamilton had regarded the permanent federal debt as a principal source of support for the national government, Jefferson and the Republicans were determined to pay it off—and quickly. More important, they regarded the ability of governments to borrow money as the major means by which nations carried on war, something they wished to avoid. In 1798 Jefferson actually thought of amending the Constitution by “taking from the federal government the power of borrowing.” He knew “that to pay all proper expences within the year would, in case of war, be hard on us.” But the alternative was worse, “ten wars instead of one. For wars would be reduced in that proportion.”65 But in 1801 he knew such a proposal would be controversial, and the same end could be accomplished by severe economy.66 Each year of his presidency he habitually called for further reductions in the debt. If the public debt were not extinguished, he warned Gallatin in 1809, “we shall be committed to the English career of debt, corruption and rottenness, closing with revolution. The discharge of the debt, therefore, is vital to the destinies of our government.”67

  By 1810, even with the $15 million in cash and claims spent on the Louisiana Purchase, the Republicans had reduced the federal debt to half of the $80 million it had been when they took office. Jefferson was obsessed with the power of debt. It was not only a matter of preventing a present generation from burdening its descendants or of reducing the wherewithal of waging war. He also wanted to destroy what he considered an insidious and dangerous instrument of political influence. Eliminating the public debt was part of his ultimate desire to create an entirely new kind of government, one without privilege or patronage.

  Perhaps nothing illustrates Jefferson’s radical conception of government better than his problems with patronage. In the radical Whig-country view of politics, patronage—appointing people to office and creating clients—was corruption. Jefferson believed that Hamilton, like all the eighteenth-century English ministers of the crown, had built support for his program by essentially buying people off—giving them offices or other favors. When Jefferson assumed the presidency in 1801, he was determined to do things differently, to create a republican government that was free of corruption.

  The problem was that not all Republicans took his assault on patronage as seriously as he did. Many of them, alarmed by his suggestion in his inaugural address that “we are all republicans, we are all federalists,” thought that he might not thoroughly oust the enemy. Some were reluctant to join a government in which they might have few sources of influence. With the slashing reductions contemplated for the navy, for example, Jefferson had to go to his fifth choice before he got Robert Smith of Maryland to serve as secretary of the navy. Jefferson tried to assure his colleagues that the conciliatory words in his inaugural address referred only to the large body of Federalists, not their leaders. But the Republicans wanted more than just a few officers removed. “Elective government would then be contemptible indeed,” declared William Duane’s Aurora, “if a change of a few superior individuals, without regard to the virtues or integrity of subordinate agents, were to be the only consequences.”68

  Jefferson felt beleaguered by this sort of pressure. “It is the business of removal and appointment,” Jefferson grumbled to John Dickinson in June 1801, “which presents the serious difficulties. All others compared with these, are as nothing.” Time and again the president found himself caught between his conscientious determination to avoid anything resembling Hamilton’s corruption and the pressing demands of his fellow Republicans that he give them the offices they deserved. In his reply to a group of New Haven merchants in July 1801 he suggested the Republicans were owed at least “a proportionate share in the direction of the public affairs,” by which he seems to have meant about one-half the offices. His Republican colleagues, however, interpreted the phrase to mean something closer to three-quarters, and this became the rule. The Federalists were furious and castigated the president for being “the head of a party & not of the nation.” No wonder that Jefferson complained that the removal and appointment of officeholders was the heaviest burden of his presidency.69

  Of course, once the Federalists were replaced by Republicans, there was no further need for the Republicans to compromise on this issue of patronage, and removals from office for political reasons came to an end. Under Jefferson and his Republican successors, James Madison, James Monroe, and John Quincy Adams, the holders of federal government appointments became a permanent officialdom of men grown old in their positions.

  Still, many Republican congressmen remained eager to isolate themselves from all executive influence in their desire to prevent the Congress from becoming “a corrupt, servile, dependent and contemptible body” like the British House of Commons. With Jefferson himself being “averse to giving contracts of any kind to members of the Legislature,” Congress in 1808 explicitly forbade this practice in order to maintain, as one Virginia congressman put it, “the purity of the Representative body.”70 Despite this legislative isolation, however, Jefferson was able personally to direct Congress and the Republican party to an extraordinary degree. He used a combination of his initial patronage and some improvised forms of political influence—in particular his use of confidential legislative agents and his weekday legislative dinner parties with congressmen, usually eight in number with no women present.

  As Federalist Manasseh Cutler observed in 1802, Jefferson held no levees but instead held dinners for the congressmen in rotation. “Strange” as it seemed, said Cutler, “(if anything done here can be strange) only Federalists or only Democrats are invited at the same time.” The idea, as Jefferson explained in 1806, was to bring congressmen and the president together to “know one another and have opportunities of little explanations of circumstances, which, [if ] not understood might produce jealousies and suspicions injurious to the public interest.” Of course, as the numbers of Federalists in Congress declined, fewer of them needed to be invited to dinner.71

  Yet Jefferson’s personal influence and his notable achievements as president cannot obscure the remarkable transformation in the traditional meaning of government that the Republican revolution of 1800 created. Durin
g the opening decades of the nineteenth century, especially after Jefferson retired from the presidency, the United States government was weaker than at any other time in its history. Foreign immigrants were astonished that the national “government” in America made “no sensation.” “It is round about you like the air,” said a startled William Sampson fresh from Ireland, “and you cannot even feel it.”72

  THE JEFFERSONIAN REVOLUTION was an extraordinary and unprecedented experiment in governing without the traditional instruments of power. Governments in the early nineteenth century were not supposed to cut taxes, shrink their bureaucracies, pay off their debts, reduce their armed forces, and diminish their coercive power. No government in history had ever voluntarily cut back its authority. With such a diminished and weakened government, how would the society hold together? Jefferson and the other Republican leaders had an answer, an enlightened answer that makes their political experiment one of the most idealistic in American if not world history. They imagined that people’s natural sociability and willingness to sacrifice their selfish interests for the sake of the whole would be sufficient social adhesives. And if these republican ideas could spread, perhaps the world itself would become a different place.

  But for Hamilton and the Federalists these imaginings were nothing but “pernicious dreams.” By abandoning monarchical ceremonies and rituals, force, and governmental corruption—the main instruments by which eighteenth-century governments had held their turbulent societies together and ruled—the Republicans, said a disgruntled Hamilton, were offering “the bewitching tenets of the illuminated doctrine, which promises men, ere long, an emancipation from the burdens and restraints of government.” As early as 1794 Hamilton had been alarmed by the extraordinarily utopian idea coming out of the French Revolution “that but a small portion of power is requisite to Government.” And some radicals believed that “even this is only temporarily necessary” and could be done away with once “the bad habits” of the ancient régime were eliminated. Unfortunately, said Hamilton, there were wishful thinkers in both France and America who assumed that, “as human nature shall refine and ameliorate by the operation of a more enlightened plan” based on common moral feelings and the spread of affection and benevolence, “government itself will become useless, and Society will subsist and flourish free from its shackles.”

  With all the “mischiefs . . . inherent in such a wild and fatal a scheme,” Hamilton had hoped that the Republican “votaries of this new philosophy” would not push it to its fullest. But now the new Jefferson administration was trying to do just that. “No army, no navy, no active commerce—national defence, not by arms but by embargoes, prohibition of trade &c.—as little government as possible.” These all added up, said Hamilton in 1802, to “a most visionary theory.” Because of the grandiose nature of these Jeffersonian pipe dreams, the Federalists never tired of ridiculing the Republicans for walking with their heads in the clouds trying to extract sunbeams from cucumbers.73 Jefferson, the philosophical visionary, may have been ideally suited to be a college professor, they said, but he was not suited to be the leader of a great nation.74

  PERHAPS THE MOST RADICAL CHANGE resulting from the Jeffersonian election of 1800 was in politics. Popular voting took on a significance that it had never quite had before, and the increased numbers of contested elections for both federal and state officials sent the turnout of voters skyrocketing. In many places, especially in the North, the participation of eligible voters went from 20 percent or so in the 1790s to 80 percent or more in the first decade of the nineteenth century. At the same time, states that had not already done so began to expand the franchise by eliminating property qualifications or transforming the requirement into the mere paying of taxes. Of course, the enhanced importance of voting and the increase in electoral competition made suffrage exclusions as important as suffrage expansions. Delaware, Kentucky, Maryland, and New Jersey, which earlier had had no racial restrictions, now confined voting exclusively to white adult males. With the exception of a brief period in New Jersey (1790–1807) no state granted women the suffrage. By modern standards the system was far from democratic, but by the standards of the early nineteenth century America possessed the most popular electoral politics in the world.75

  For the Federalists the Republican victory in 1800 was bewildering. It was not just the loss of the presidency and the Congress that disturbed them; it was what Jefferson’s election represented socially and culturally that was so frightening. Since “the Degradation of our Nation and the corruption of the public mind & of the Morals of Individuals are constantly increasing,” it seemed to Federalists like Christopher Gore of Massachusetts that the America they envisioned was coming to an end.76 Because the Federalists did not think of themselves as a party but rather as natural leaders who possessed superior social and cultural credentials, at first they did not think of the contest with the Republicans as one party against another. It was instead “a war of principles, . . . a contest between the tyranny of Jacobinism, which confounds and levels every thing, and the mild reign of rational liberty.”77

  The Federalists’ world was dramatically changing, and they were understandably alarmed. Vulgarity seemed to be spreading everywhere, and in their minds upstarts and demagogues and Jacobins had taken over the reins of government. “We are sliding down into the mire of a democracy, which pollutes the morals of the citizens before it swallows up their liberties,” wrote a deeply pessimistic Fisher Ames.78

  Not all Federalists were as depressed as Ames, but most were confused and unsure of what to do. They could not understand how so many uneducated and illiterate men were gaining elective office at the expense of men of talent and education.79 They had tried satire and ridicule, as Noah Webster had by mocking the middling sort of politician in pursuit of office: “I will run about streets,” he had his character declaim, “take every body by the hand, squeeze it hard, and look sweet.” But such mocking had no effect. What was most socially alarming about the new style of popular campaigning, said Webster, was that it could make a “SOMEBODY” out of a “MR. NOBODY.”80

  As heirs of the republican Revolution, which in some sense was all about making somebodies out of nobodies, the Federalists were confused. Since they believed that the people should be the fount of government, they found it difficult to oppose the Republicans’ efforts to have as many offices as possible made elective. As an Ohio Federalist lamented, to oppose elections would be used “by our enemies, as an evidence of an encroachment on the privileges of the people.”81 With no real alternative to the people’s will, the Federalists inevitably surrendered the national ruling authority in 1801 without a fight—and it was their willingness to surrender that made the historic transition so peaceful. But they certainly did not regard the transfer of power from one party to another as normal in any modern sense. Because the older Federalist leaders considered themselves gentlemen for whom politics should not be an exclusive concern or vocation, many, including John Jay, George Cabot, and Charles Cotesworth Pinckney, echoed Joseph Addison’s Cato: “When vice prevails, and impious men bear sway,/ The post of honor is a private station,” and retired to their professions and private lives to await what they assumed would soon be the people’s desperate call for the return of the “wise and good” and the “natural rulers.”82

  But the popular reaction to the Republican revolution did not come. Many gentlemen of property and standing who earlier might have felt an obligation of their rank to participate in public affairs now stayed home and advised others to do the same, rather than have your “character bandied about through so many counties.” Even as early as 1797 Hamilton had begun questioning the classical imperative that men like him, men who were not independently wealthy, had an obligation to assume public office. In America “the pecuniary emolument is so inconsiderable as to amount to a sacrifice to any man who can employ his time with advantage in any liberal profession,” he told his Scottish uncle. “The opportunity of doing good, from the jeal
ousy of power and the spirit of faction, is too small in any station to warrant a long continuance of private sacrifices.” With the spread of such sentiments a world was coming to an end.83

  In 1803 President Timothy Dwight of Yale told his graduates to “never look either for subsistence, or for character, to popular suffrage, or governmental appointment, to public salaries, or official perquisites.”84 But others who wanted a successful political career and were convinced that Federalism could never come back, like John Quincy Adams, the son of the former president, and William Plumer, senator and later governor of New Hampshire, eventually joined the Republican movement. Young Adams concluded as early as 1802 that the Jefferson administration had “the support of a much stronger majority of the people throughout the Union than the former administrations ever possessed.” The Federalist system, he said, had been “completely and irrevocably abandoned and rejected by the popular vote. It never can and never will be revived.”85

  Nevertheless, others, like Robert Goodloe Harper of South Carolina and James A. Bayard of Delaware, clung to their Federalist principles and their minority status in the Congress or in their state governments. Still others, like Fisher Ames, urged their colleagues to “entrench themselves in the State governments and endeavour to make State justice and State power a shelter of the wise, and good, and rich.”86 And still others, like Timothy Pickering, secretary of state under Adams, and Roger Griswold, congressman and later governor of Connecticut, dreamed of revenge and fomented separatist plots in New England. Yet most thoughtful Federalists knew that separation of the Northeastern states from the Francophiles in the rest of the country was no solution to the problems of America; for, as George Cabot of Massachusetts put it, the source of the evils afflicting America ultimately lay not in the Southern states or in Revolutionary France but “in the political theories of our country and in ourselves.”87