What Hath God Wrought (82 page)

Working-class families by no means escaped the influence of such ideas about gender roles. Journeymen mechanics, insisting on a “family wage” for themselves and that their wives belonged at home, simultaneously asserted their claim to respectability and resisted competition from women’s lower wages. The wage-earning husband thus asserted claim to the dignity of a household head, a status that wage-earners had generally been denied in colonial and Jeffersonian America, but one compatible with his standing now as a voter. For her part, the housewife’s role came to be recognized as a responsible and versatile occupation in both middle and working classes, the subject of instruction manuals like Lydia Maria Child’s
American Frugal Housewife
(1836). The Victorian ideology of separate gender “spheres,” a private one for women and a public one for men, while never fully realized in practice, reflected the consequences of industrialization and its separation of workplace and home.
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VI

Although the hard times after 1837 produced calls for economic action by the federal government, at the state level the depression acted to discourage rather than encourage government intervention in the economy. Many mixed public-private corporations in the transportation and banking industries lost money for their public investors and even went bankrupt. The economy paid a price for the absence of any national infrastructure scheme, such as Henry Clay’s American System or Albert Gallatin’s Plan of 1808. Competitive rather than coordinated, responding to their constituents’ hopes, the state legislatures had placed some bad bets. Once burned, twice shy: Reflecting a chastened public opinion, state governments now felt reluctant to gamble again on stock ownership, and indeed some states rewrote their constitutions in the 1840s to forbid it. The federal government did not pick up the slack. Jackson’s Maysville Veto Message, rather than his internal improvements expenditures on rivers and harbors, stuck in the public memory and shaped his party’s policies in the coming years. Significantly, the Maysville Road Company had been a mixed corporation in which the federal government would have purchased stock if Jackson had signed the bill. Few mixed corporations were chartered anymore. For the time being, the responsibility for raising the capital for infrastructure development remained mostly with private enterprise or municipal governments, chartered by the states.
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The decline of mixed corporations in the United States was accompanied and followed by gradual changes in the nature of private corporations facilitating their use to mobilize capital. Corporations could be either civic (such as municipalities with rights to self-government conferred by their state), philanthropic (such as universities), or for business purposes. Defined as a “legal person,” a corporation could own property, make contracts, borrow money, and file suit in court. The principle of limited liability for the stockholders of a business corporation, as distinguished from the unlimited liability of members of a partnership, had already been established. Surprisingly to us, business corporations only gradually adopted the uniform principle that stockholders’ voting rights depended on how much money they had invested. Antebellum corporations sometimes treated their shareholders like the citizens of a commonwealth, each having one vote. Of course, this rule enhanced the influence of small investors.
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Throughout our period, the corporate form of organization remained a privilege conferred by the state in return for what were considered services to the public interest. The sense that corporations received special favors did not enhance their universal popularity. Banks of issue were not the only corporations to encounter resentment on such grounds. Defenders of the old artisan system of manufacturing long remained suspicious of any incorporated business as well as the factory system of production. In 1835, for example, the journeymen cordwainers of Newark, New Jersey, passed this resolution at a meeting:

In an effort to avoid favoritism while also allowing the multitude of small investors their chance, various states enacted general laws of incorporation that conferred corporate status upon any business applicant(s) who complied with certain rules. Connecticut is usually credited with having passed the first such act in 1837, though New York had enacted one in 1811 that applied only to manufacturing companies. States also responded to the misgivings of people like the New Jersey cordwainers by imposing various regulations on corporations, even sometimes specifying the composition of the board of directors.
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But in the first half of the nineteenth century, most business corporations were still chartered by special acts of state legislatures, and most were still in transportation and financial services, not manufacturing. Unlike today’s corporations, they might exist only for a limited term: like the first and second national banks, each chartered for twenty years. Meanwhile, municipal corporations also multiplied in response to increasing urbanization, and states delegated broad powers to some of them over public utilities, public health, and law enforcement. These corporations too played an active economic role, exercising the power of eminent domain and, like the states themselves, imposing innumerable regulations on business enterprises.
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Subtle changes in the law of contracts may have proved as significant as the evolution of corporate structure in determining the climate for private investment. In the eighteenth century, the essence of a contract had been the concept of
consideration
—that is, the contract as a promise made in return for money or some other advantage. Judges felt free to invalidate contracts in cases where the consideration seemed inadequate. The nineteenth century saw judges becoming more concerned with the concept of
free will
—that is, the contract as an agreement freely entered into by both sides, with the implication that if one chose to make a promise one should keep it. The general legal maxim for purchases was
caveat emptor
, “Buyer beware.” Legal scholars have argued that the new attitude helped reassure investors, creditors, and employers and hence fostered the transportation and industrial revolutions.
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It would not be surprising if the judges’ outlook reflected the respect for free will that nineteenth-century thinkers generally demonstrated, not only in law but also in theology, psychology, and moral philosophy.

The rising Christian humanitarianism manifested in the benevolent reforms of the period also influenced judges, especially in the law of torts (personal injuries). Particularly from the 1830s on, judge-made legal innovations often reflected increased compassion for underdogs like children hurt by trolleys while playing in the street or persons injured by defective bridges. Even contract law was tampered with in the interests of workers who quit before their entire labor contract had expired. Judicial opinions of this nature often cited “the common feeling of mankind” or the Bible itself in justification for their compassion.
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But humanitarian benevolence impacted the law of slavery only marginally, mainly affecting slaves who had some claim to freedom. In general, legal innovations on the subject of slavery seem to have facilitated commercial considerations at the expense of human values. Like other property, slaves could be sold, mortgaged, bequeathed, insured, and hired out. Professional slave traders commanded little respect in southern society, perhaps reflecting moral embarrassment at their occupation but also for much the same reasons that used car dealers do in our society. Though most slave dealerships were small operations, a few like Franklin & Armfield, with offices in Alexandria and New Orleans, were large, sophisticated enterprises. Law courts supervised almost half of all slave sales, as part of estate or bankruptcy proceedings, and no one questioned the probity or dignity of judges for exercising this function. Congress never regulated the interstate slave trade, though it possessed the right to do so. Louisiana had elaborate consumer protection laws to help slave purchasers, reflecting the outlook of a major slave-importing state. Under the law of all states, slaves had a dual character as both property and persons; for example, slaves could be tried in court for crimes, and the unjustified killing of a slave was legally murder (a rule hardly ever enforced against the slave’s owner). But down to the middle of the nineteenth century, the evolution of state law in the South tended to make the jurisprudence of slavery more responsive to liberal capitalist and contract notions, favoring the master’s free market in slave transfers “at the expense of the slaves and their families,” notes historian Thomas Morris.
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Slavery represented one area within which it is impossible for us to accept that economic rationality was really a good thing.

With state and federal governments holding off on making economic commitments, and in the absence of a national bank, recovery from the depression of the Van Buren years came slowly. The textile mills of Lancashire and New England gradually worked through their glut of American cotton and began to place new orders. This emboldened state and local bankers to make countless small decisions to resume lending money to agricultural producers. Of course, before banks could print banknotes and lend them out, the banks had to exist. Chartering new banks often provoked controversy within a state between soft-money and hard-money factions. The decision of some states, notably New York in 1838, to adopt “free banking,” granting bank charters to all comers in accordance with general laws of incorporation, multiplied the sources of credit. Without banks, borrowers (especially in the West) would have found it difficult to negotiate loans from savers (mostly located in the East), and more of the country’s capital would have remained unproductively stored up in unused land or inventories of livestock and agricultural produce. Without bank notes, frontier and rural America would have been thrown back on “a rag-tag mixture of foreign and domestic coins, land warrants, tobacco warehouse receipts, even animal pelts”—inefficient substitutes that increased the cost of transacting business.
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So desperate was the eagerness for currency that counterfeit circulated widely with very little attempt to suppress it, alongside the notes of distant and insolvent banks. Retail traders routinely accepted almost anything resembling money and passed it along, following the maxim “If you buy the devil, the sooner you sell him, the better.”
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The resumption of bank lending in the 1840s produced not inflation but expanded national product. In fact, during the antebellum period the American price level never stayed far out of line from the British.
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While the opportunities for fraud provoked hard-money criticism, the plain commercial truth was that America needed banks and banknotes. The soft-money advocates were right. The disorderly banking that followed the demise of the BUS proved better than no banking at all.

Despite the anarchic state of the money supply, the nineteenth-century United States did not represent the age of pure laissez-faire that many people imagine. This widespread misconception does not square with the economic role actually played by state and local governments. The decline of mixed corporations provoked by the depression of the Van Buren years proved permanent, but the decline in state promotion of internal improvements turned out to be very temporary. The coming of the railroads encouraged a new wave of economic interventions by most of the states, many localities, and eventually the federal government as well. Rather than waiting for prosperity to return in the 1840s, American governments actively promoted it through their investments in the newly invented steam railroads.
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VII

George Stephenson operated a steam-powered pump that sucked water out of a mineshaft near Newcastle-upon-Tyne in the North of England. In 1814, he invented a steam locomotive that could pull coal from the mine shaft to a nearby dock for loading onto a barge; over the next decade he built similar machines for other local mining companies. Wider applications for the invention became apparent. In 1825, Stephenson demonstrated a locomotive that could pull thirty-six wagons of coal and flour along a level track for nine miles in two hours. Four years later Stephenson’s “Rocket” won a competition to pull trains for passengers as well as freight on a railway between Liverpool and Manchester. The intercity track opened in 1830 with Prime Minister Wellington riding the first train. The unschooled son of a mechanic had changed the world. Like its American counterpart, the British industrial revolution was to a large extent the creation of the working class.

Across the Atlantic, an American named John Stevens constructed a prototype locomotive in 1825. Born into a prominent family, Stevens was an exception to the rule that inventors came from artisan origins, but he still couldn’t raise enough funding for the railway he planned across New Jersey. The first functioning railroads in the United States were much more modest: They moved animal-drawn cars for short distances, as did the one in Quincy, Massachusetts (1826), which carried stone for three miles from quarry to dockside. An English-built steam locomotive imported in 1828 turned out too heavy to be serviceable on the uneven American terrain. When twenty-three miles of track opened on what was optimistically named the Baltimore & Ohio Railroad that same year, the cars had to be pulled by horses pending the construction of a locomotive. Even so, at the ceremony when construction of the B&O rails began on the Fourth of July, 1828, ninety-one-year-old Charles Carroll, sole surviving signer of the Declaration of Independence, turned the first spadeful of earth and told the crowd, “I consider this among the most important acts of my life, second only to my signing the Declaration of Independence, if even it be second to that.”
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