US HISTORY CIVIL WAR NOTES 1
Economy of the South
- Rural: farms & countrysides, not cities
- 200 to 290 days of frost free growing
- though southerners depended on northern banks
and industry, few southerners ventuered into it
- most farmers in the south did not own many
slaves (half cotton crop produced by farms w/ 6 or less slaves)
- Virginia & North Carolina kept to Tobacco,
despite the cotton gin
- Sugar & rise in South Carolina
- Kentucky was varied but specialized in horses
- Slaves were considered property
- Prime field hands (18 – 25)cost about $500
in 1832, 5 years later the price had tripled
- Slaves cost between 15 to 60 dollars to support
(per year)
2 Party system
National Republicans (WHIGS) & Democrats
Whigs:
Fed Gov. Should take leadership role
Fed Gov. Should support internal improvements
(roads & bridges)
in favor of nation bank
tend to be middle class or well-established protastants
Democrats:
Fed. Gov. Should remain as inactive as possible
Individuals should be responsible for internal
improvements
Against national bank
Tend to be slave-holders, small farmers, non-protestants,
and working class
National Bank
- Jackson (DEM) felt the National Bank was
a monster controlled by a few wealthy easterners
- Held it responsible for financial panics
(1819)
- Functions: Control currency, enable government
to do financial business easily.
- Banking Policy confused—tight vs. loose money,
inflation/deflation; debtors, creditors. Madison says 1815 if state banks
cannot control currency, national bank is necessary. Treasury Secretary
Dallas introduces new bank bill.
- National Bank held and managed all tax money
– paying off the nation’s debt and investing its money
- Supervised small banks
- Loans were typically for 30 to 60 days
- In those days banks made loans by issuing
their own currency. These bank notes were supposed to be convertible, on
demand, to cash -- that is, to gold or silver
- the job of the bank examiner to visit the
bank and certify that it had enough cash on hand to redeem its outstanding
currency. Because this was not always done, many bank note holders found
themselves stuck with worthless paper
- By 1860 more than 10,000 different bank notes
circulated throughout the country. Commerce suffered as a result
- Counterfeiting was epidemic. Hundreds of
banks failed.