A Nation Wholly Free: The Elimination of the National Debt in the Age of Jackson
Format: PDF / Kindle (mobi) / ePub
“An engaging treatment of a topic of perennial concern and frequent misunderstanding, this lucid tale of the brief moment when the United States was debt-free should be on every Congress member’s bedside table.”—Peter J.Woolley, Professor of Comparative Politics, Fairleigh Dickinson University
When President James Monroe announced in his 1824 message to Congress that, barring an emergency, the large public debt inherited from the War for Independence, the Louisiana Purchase, and the War of 1812 would be extinguished on January 1, 1835, Congress responded by crafting legislation to transform that prediction into reality. Yet John Quincy Adams,Monroe’s successor, seemed not to share the commitment to debt freedom, resulting in the rise of opposition to his administration and his defeat for reelection in the bitter presidential campaign of 1828. The new president, Andrew Jackson, was thoroughly committed to debt freedom, and when it was achieved, it became the only time in American history when the country carried no national debt. In A Nation Wholly Free: The Elimination of the National Debt in the Age of Jackson, award-winning economic historian Carl Lane shows that the great and disparate issues that confronted Jackson, such as internal improvements, the “war” against the Second Bank of the United States, and the crisis surrounding South Carolina’s refusal to pay federal tariffs, become unified when debt freedom is understood as a core element of Jacksonian Democracy.
The era of debt freedom lasted only two years and ten months. As the government accumulated a surplus, a fully developed opposition party emerged—the beginning of our familiar two-party system—over rancor about how to allocate the newfound money. Not only did government move into an oppositional party system at this time, the debate about the size and role of government distinguished the parties in a pattern that has become familiar to Americans. The partisan debate over national debt and expenditures led to poorly thought out legislation, forcing the government to resume borrowing. As a result, after Jackson left office in 1837, the country fell into a major depression. Today we confront a debt that exceeds $17 trillion. Indeed, we have been borrowing ever since that brief time we freed ourselves from an oversized debt. A thoughtful, engaging account with strong relevance to today, A Nation Wholly Free is the fascinating story of an achievement that now seems fanciful.
with two choices, and it took both. It could and did print fiat money, the notorious “continentals,” which depreciated with each issue; and it could and did borrow in various ways from American citizens as well as, it turned out, from foreign powers. As a consequence, the United States was, as Robert E. Wright has written, “born in debt.”9 Some irony exists here. The British national debt was the parent of all those evils against which Americans rebelled, yet, to resist those evils, Americans
in fear of losing them. Here was the “reform” he had promised, and he subsequently defended his action on the ground that “rotation in office” was more consistent with democratic and republican values than the prevailing system within which office holding had become “a species of property.”33 Careerism in public service promoted individual interest over public interest while broad participation served the common good. Jobs in the departments of the United States government, he believed, were
this pledge I am determined to redeem, and I cannot do this if I consent to encrease [sic] it without necessity. Are you willing—are my friends willing to lay taxes to pay for internal improvements?—for be assured I will not borrow a cent except in cases of absolute necessity! Johnson: No!…[T]hat would be worse than a veto! Johnson picked up a green bag he had carried with him and prepared to depart. Van Buren stopped him, explaining that the Kentuckian should not conclude from the conversation
it to Secretary Ingham for review and evaluation. While the president awaited the treasury secretary's report, Biddle decided to lobby personally in its favor and for recharter, which the bonus feature of the plan implied. He traveled to Washington in late November for a conference with Old Hickory at the White House. Biddle, who wrote a memorandum sometime after the meeting, recalled the conversation this way.12 Jackson: “I was very thankful to you for your plan of paying off the debt sent to
the New York delegation. His head-counting revealed that as long as New York remained tied, no candidate would secure the necessary thirteen state votes to win. Accordingly, he wanted the New York tie to persist through several ballots in the hope that Adams's support in other states would melt away, giving his candidate a shot at winning. The Crawford men in the New York delegation had, meanwhile, all promised Van Buren that they would remain firm for the Georgian.50 On the morning of Election