Fateful Lightning: A New History of the Civil War & Reconstruction

own vines and fig trees, unmolested by tax agents and bill collectors. “Corruption or morals in the mass of cultivators,” Jefferson wrote in his celebrated Notes on the State of Virginia, “is a phenomenon which no age nor nation has furnished an example.” No one seemed to personify that ideal more than Jefferson’s fellow Virginian and virtuous senator, John Taylor of Caroline, who impressed a colleague as “plain and solid, a wise counsellor, a ready and vigorous debater, acute and comprehensive, ripe in all historical and political knowledge, innately republican—modest, courteous, benevolent, hospitable—a skilful, practical farmer, giving his time to his farm and his books, when not called by an emergency to the public service—and returning to his books and his farm when the emergency was over.”²¹

Banks, on the other hand, looked like precisely the enormous concentrations of power and self-interest that were the source of corruption, and those fears of corruption were not eased when large-scale banks such as the Bank of the United States began paying handsome retainers to members of Congress to sit on its board of directors. Democrats were equally fearful of chartered corporations, since large-scale corporations could just as easily acquire the same enormous wealth as banks and, with it, the same power for corrupting state and local legislatures. It was a point of pride to John Randolph of Roanoke, one of the sharpest-tongued Jeffersonians in the House of Representatives, that “I am the holder of no stock whatever, except livestock, and had determined never to own any … because it is the creation of a great privileged order of the most hateful kind to my feelings, and because I would rather be the master than the slave. If I must have a master let him be one with epaulettes, something that I could fear and respect, something I could look up to—but not a master with a quill behind his ear.”²²

For the first three decades of the American republic, it was clearly the fears of the Democrats that had the upper hand. Of the 4 million people living in the United States in 1790, 3.7 million of them lived in the countryside and only about 200,000 in towns or ports larger than 2,500 people. Although the first two presidents, Washington and Adams, favored development and competition on the world markets as the best method for toughening the independence of the American economy, the costs of that encouragement were federal taxes. A country that had formed in a revolt against British taxes was in no mood to pay them to the federal government. Thomas Jefferson, promising an “empire for liberty,” was swept into the presidency in 1800 in a tremendous landslide, which secured Democratic control of the federal government for the next quarter century. Accordingly, the Democrats allowed banks and corporate charters to wither, and in 1807 Jefferson briefly imposed an absolute embargo on all foreign trade. If the surrounding economic world required that Americans dabble in economic power in order to safeguard political liberty, then better to quarantine the Republic economically rather than surrender it to world markets. ²³

What Jefferson had not entirely counted upon was the degree to which isolation really did translate into weakness. Britain, then at the height of its titanic grapple with Napoleon Bonaparte, discovered that an American government without a bank for borrowing or taxes for spending had no way to fund a navy for protection, and so British warships shamelessly boarded American ships and impressed American sailors to fill up depleted British crews. In 1812, Jefferson’s handpicked successor as president, James Madison, responded by leading the country into war against the British. It was a catastrophe. “Our commerce [had been] put in fetters by non-importation acts and embargoes; and the crisis that succeeded found us without the most ordinary resources of an independent people,” complained John Pendleton Kennedy, a Whig congressman from Maryland. “Our armies went to the frontier clothed in the fabrics of the enemy; our munitions of war was gathered as chance supplied them from the four quarters of the earth; and the whole struggle was marked by the prodigality, waste and privation of a thriftless nation, taken at unawares and challenged to a contest without the necessary armor of a combatant.” ²⁴ The unprepared American armies were routed by a British empire that was already fighting with one arm tied behind its back by Napoleon, and the household-based American economy fell apart. By the end of the war, only major loans from private bankers kept the United States Treasury from collapse. And only British exhaustion from its European wars kept Britain from turning the American republic back into British colonies.²⁵

The disaster of the War of 1812 frightened many republicans away from Jefferson’s fond dream of a nation of liberty-loving but economically powerless farmers. “These disasters opened our eyes to some important facts,” Kennedy recalled in 1831. “They demonstrated to us the necessity of extending more efficient protection, at least, to those manufactures which were essential to the defence of the nation” as well as the establishment of “the value of a national currency, and the duty of protecting it from the influence of foreign disturbance” through the shield of a national banking system. Led by Henry Clay of Kentucky, a new party of National Republicans, or Whigs (as Clay renamed them in the 1830s), resurrected the program of government support for internal improvements, government-sponsored banking, and a new program of protective tariffs to keep out cheap imported British manufactured goods and stimulate manufacturing at home. “National independence was only to be maintained by national resistance against foreign encroachments,” declared Clay in 1816, “by cherishing the interest of the people, and giving to the whole physical power of the country an interest in the preservation of the nation.” Clay went on to endorse the new military program, “a chain of turnpikes, roads and canals from Passamaquoddy to New Orleans,” and tariffs to “effectually protect our manufacturers.” ²⁶

Although the presidency remained firmly in the hands of the