A history of Kentucky and Kentuckians; the leaders and representative men in commerce, industry and modern activities, Volume I, Part 37

Author: Johnson, E. Polk, 1844-; Lewis Publishing Company
Publication date: 1912
Publisher: Chicago, Lewis Pub. Co.
Number of Pages: 656

USA > Kentucky > A history of Kentucky and Kentuckians; the leaders and representative men in commerce, industry and modern activities, Volume I > Part 37

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The people of the United States, peace-lov- ing as they are, have always had a warm spot in their hearts for the successful soldier. The east, then as now, considered no man from the west as its equal. The man whose an- cestors had not set foot upon Plymouth Rock was not to be considered in the selection of a president. Jackson was a plebeian, a North Carolina mountaineer, and, though he had won the great victory at New Orleans, he was not to be considered as a possible president. Henry Clay, a Virginian, not an aristocrat by birth, but an able man by reason of intellect, made an appeal to them which Jackson could never do. Adams was elected president by the house, but the vote of Mr. Clay for Adams

in the house sounded the death knell of his presidential hopes. Either he should win in 1828, or Jackson should take the prize.

Of the campaign in that year, Judge Little reports Baldwin as saying: "The election of Adams by the house of representatives was turned to account with all its incidents and surroundings, with admirable effect by Gen- eral Jackson. No one now believes the story of bargain, intrigue and management told upon Adams and Clay, but General Jackson believed it and what is more, made the coun- try believe it in 1825. Adams was an unpop- ular man, of an unpopular section of the country. Crawford's friends were as little pleased as Jackson's with the course affairs took. The warfare upon Adams was hailed by them with joy and they became parties to an opposition of which, it was easy to see, Jackson was to be the beneficiary."

Clay's ambition, or incaution, betrayed him into the serious and as it turned out, so far as concerns the presidency, the fatal error of accepting office, the first office, under the ad- ministration which he called into power. It was in all political respects, an inexcusable blunder. The office added nothing to his fame. It added nothing to his chances for the presi- dency. He was, on the contrary, to share the odium of an administration at whose head was a very obstinate man of impracticable temper, coming by a sort of bastard process, into of- fice, bearing a name which was the synonym

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of political heterodoxy and whose administra- personal intimidation or to avenge it by vio- lence.

tion was fated to run a gauntlet from the start to the close, through a long lane of clubs wielded by the Forsythes, McDuffies, Ran- dolphs and almost the whole talent of the south.

Mr. Clay was a statesman and an absolutely honest man. He made a mistake in voting for Mr. Adams and but for that mistake, he would, soon or late, have been president of the United States. Ile was not a mere politician ; had he been, he would have played the game differently. He might have voted for Craw- ford, who was not likely to live until the next election. But Clay placed himself alongside of those who supported Mr. Adams and brought about the latter's election. The op- posing forces of that day charged Mr. Clay with corruption. Time softens the asperities of politics and today there is none to believe that Mr. Clay was corrupt. The worst that can be said, is that he made a mistake in ac- cepting a position in Mr. Adams' cabinet. Mr. Clay's place was in the senate, and there he should have remained. No greater senator has held a seat in that body-not Webster ; not Calhoun ; no man was greater there than Henry Clay.

A historian of that period has written of the attacks upon Mr. Clay and those who be- lieved with him: "Those assaults were not slow in coming. The public mind had been fallow for some years, and was prepared for a bountiful crop of political agitation. Jack- son raised the war cry and the hills and val- leys all over the land echoed back the shout. A lava-tide of obloquy poured in a flood over Clay. It seemed to take him by surprise. The idea that his voting for Adams and then oc- cupying the first office in his gift, seconded by the supports which the hypotheses of 'bar- gain' found, or were made for it. should orig- inate such a charge, seems never to have en- tered his imagination, and when it came he had the weakness to attempt to strangle it by

"The election of Adams under such circum- stances, was the making of Jackson. It filled up his popularity. It completely nationalized it. The States Rights party, to whom the name and lineage of Adams were enough for opposition, turned at once to the man who could best defeat him and saw at a glance who that man was, and the popular sympathy was quickly aroused in behalf of the honest, old soldier, circumvented by two cunning politi- cians."

In 1832, Mr. Clay was again a candidate for the presidency, but was defeated by General Jackson, who had been referred to in preced- ing campaigns as "the honest old soldier, cir- cumvented by cunning politicians." If his- tory were a place for jokes, this would be a point where one could be interjected. The idea of Andrew Jackson being circumvented by cunning politicians is calculated to cause a smile wherever the actions of that sturdy old soldier are known. What he did not know about the practical side of politics it was worth the time of no man to learn. Mr. Clay pos- sessed the politician's hatred for General Jackson and when each of them had passed from the arena in which their lieutenants liad bravely struggled, they left a heritage of ha- tred which did not die for years. How piti- ful is this bitterness of politics. Men who stand shoulder to shoulder in business affairs ; who entrust thousands of dollars to each other without a written word to witness the trans- action, profess not to believe in the honesty of their political opponents and can find no words which properly define that distrust. It is sickening and disgusting to know that this is true, and the writer of these words is glad to know that he has reached an age when he can give to political friend and political op- ponent an equal meed of praise. The man who cannot do so, is a man who puts political place and power above political decency. The masses

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of mankind are personally honest and the man who arrogates to himself and those who join in his beliefs, all the honesty and relegates to the opposition all the dishonesty of political belief, is a man who should be constantly watched because he is not a good citizen. The division of political parties in our country is too nearly equal for all the good men to be- long to the one party, all the bad men to the other.

The Whig party in Kentucky, which had supported Mr. Clay with an enthusiasm rarely equaled, felt very bitterly the effects of de- feat. He was the idol of his party and justly so. No greater man had led a party to vic- tory or defeat than he. Not the solid Repub- lican phalanx which in after years, stood like a stone wall by the side of Mr. Blaine, the favorite son of his party, was more earnest than the men who aligned themselves by the side of Mr. Clay and who, time after time, went down to defeat with Kentucky's favorite son. The Whig party maintained its organi- zation in Kentucky but to do so, it must main- tain a constant struggle. The seeds of disso- lution had been sown and it was not long un- til they would blossom into full fruitage and the party cease to be. It only remained for Mr. Clay to pass from the field of action when there should be no Whig party in Kentucky or elsewhere.

Jackson was the hero of the moment. The people of the United States have never feared "the man on horseback." To the contrary, they have always advanced him to high exec- utive position. Mr. Clay did not recognize this fact. He claimed that the people should distrust the military chieftain, whose election to high position was dangerous to the safety of the government. The people thought oth- erwise. They elevated to the presidency- Washington, the Father of his Country, who was nothing if not a soldier; they put into power later, Harrison, Taylor and Grant, the latter long after Mr. Clay had passed away ;

and under none of these did the republic suf- fer. "The Man on Horseback," may prove a shibboleth for the opposition, but he can never disturb nor distress the republic, whether successful or not in his efforts to reach the presidency. Mr. Clay, though of hum- ble birth, was, in the end. a patrician. He could never abide the low-born Jackson and af- ter the success of the latter, he is found writ- ing to a friend: "The military principles have triumphed and triumphed in the person of one devoid of all the graces, elegancies and mag- nanimity of the accomplished men of the pro- fessions." But it was not then as it is not now, a wise thing to underestimate the power of one's adversary. Jackson was president and president he was destined to be for eight years, during which by a skillful use of the tremendous power of the presidency, he built up a party which the opposition could not suc- cessfully assail and which gave to him the opportunity to name his successor in the exec- utive office.

Mr. Clay, though the idol of his party, and justly so, was compelled to bide his time, awaiting new opportunities and by the irony of fate new defeats. The Whig party in Ken- tucky awaited with Mr. Clay, the coming of the day when it should come into power. ever hopeful; ever doomed to defeat. It had no part in the control of the affairs of the gov- ernment ; it had a high disdain for those who controlled national affairs; it was the aristo- crat of politics and looked with disdain upon those who enjoyed the loaves and fishes which it imagined belonged by divine right, to itself. It was dying not slowly but swiftly and did not know it. There came a few years after- wards the dreadful war which separated our people and among other ideas which were defi- nitely settled by that contest were the ques- tions which the Whig party had deemed its own, and which were no more to be considered by the people of Kentucky. It was not slav- ery alone which that contest definitely set-

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tled ; it was a new alignment of political par- ties and the old Whig party was not among them, because it was dead. There was some- thing pathetic about its demise, chiefly because it did not know that its end had come. For years after the war had closed, there were sturdy old aristocrats who voted the Demo- cratic ticket, explaining meanwhile, that they had to do so, not that they were Democrats, but that they were not Republicans and had to vote against some one. It is pleasant to re- member these sturdy old gentlemen today. They remind us of the ruffle-shirted, knee breeches era and one can easily see them go- ing to the polls and voting for Mr. Clay, after that great statesman had passed to his re- ward; even as the Democrats were charged with voting for General Jackson years after he had been gathered to his fathers.

It would be pleasant for the historian of this period to cease to consider the Old Court and New Court question, but it was not to be disposed of, though the latter had met its de- served end. It was to mingle, in some de- gree, with the politics of Kentucky for some years yet.

The Commonwealth's Bank and the replevin laws which were a part of its history, were doomed to destruction by the triumph of the Old Court party. The replevin laws were re- pealed, and the bank was destroyed by suc- cessive acts of the legislature directing that its paper should be gradually destroyed in- stead of being reissued. In a few years, all of its issue had disappeared from commerce and in its stead, the issue of the United States Bank was accepted. This latter bank had two branches in the state, one at Louisville, and the other at Lexington. Jackson and the party which stood behind him, had for their object the destruction of this bank, and when Jack- son was re-elected president in 1832, the end of the bank was near. No one expected its charter to be renewed, and in its stead state

banks were to be established throughout the Union to supply its place.

In 1833 and 1834, the legislature estab- lished the Bank of Kentucky, the Bank of Louisville and the Bank of Northern Ken- tucky ; the first with a capital of five millions, the second with a capital of two millions and the third with a capital of three million dol- lars.

The usual result followed this multiplica- tion of banks and the enormous increase of capital. Paper money was everywhere to be had and the wildest spirit of speculation dom- inated the country. Prices of the commonest commodities rose to high figures, and the dif- ferent municipalities, even the states, em- barked in enterprises on the most gigantic scale. The people went mad in speculation. Not the tulip excitement of Holland was greater than that which sent the people into the stock market, mad with the desire for the sudden accumulation of riches. Where men had not money, they borrowed it at ruinous rates. Railroads, canals, slack water naviga- tion, turnpike roads, any and everything that looked like public improvement, caught the popular fancy and the people, gone mad with the idea of great riches speedily to accrue, put into these schemes every dollar they could bor- row and calmly sat down awaiting the flow into their coffers of endless riches. There could be but one end to this wild scheme of investment with no solid backing behind it.

In the spring of 1837, all the banks of Ken- tricky suspended specie payments and the end was near. Kentucky was spending one mil- lion dollars annually in the construction of turnpike roads, the improvement of water ways, and was looking to the early construc- tion of railways. The people, vainly imagin- ing that the plenitude of money was to be con- tinuous, were involved in speculations heed- less of the day of settlement. There was near them a day like that which had brought about

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the relief agitation of the recent years, yet they halted not but continued their financial operations based upon imaginary cap- ital as though the day of settlement were never to come. They seemed then to believe that the printing press would issue paper for their redemption, as many years later their descend- ants were to imagine themselves rich men, if only the mints would coin silver dollars as fast as their demands were made.

When the legislature met in 1837, it made legal the suspension of specie payments; re- fused to order the banks to resume such pay- ment, and also refused to declare forfeited their charters. In other words, it gave the banks carte blanche to continue as they had been and left the people to suffer. The banks and the people minimized as much as was within their power, the crisis which was upon them. This gave temporary relief only. There was no specie available for any purpose. There were issued by towns, cities and individuals small representatives of currency which had no value beyond its immediate place of issue. In later years, like small currency was issued by the United States and was known as "shin- plasters," and which served a very useful pur- pose.

In the midst of the crisis of 1837, the banks were managed with prudence, and forbore to press their creditors. In the latter portion of 1838, they cautiously begun the resumption of specie payments and as this spread through- out the United States, confidence was again felt and speculation was resumed, the appar- ent prosperity causing many to believe that there was no longer a panic to be feared.

But there was not yet a firm foundation for financial prosperity. In the latter months of 1839, specie payments ceased to be made by all except a few eastern banks. Bankruptcy

started the people in the face. Many states could not pay the interest upon their bonded indebtedness. Kentucky added fifty per cent to her direct tax to avoid defaulting upon her general indebtedness. In 1841-42, she was no longer able to postpone the day of reckoning. Her courts were congested with suits filed for the collection of private indebtedness. Prop- erty was being sacrificed under forced sales on every hand.

The people, willing to pay, anxious to pay, were unable to do so, and once again the for- mer cry for relief was heard. Regardless of the failure of the past, the harassed debtors made a demand for a Bank of the Common- wealth which should offer them a way of re- lief, permit them to meet their indebtedness and save for their families the property they had accumulated. It is characteristic of the debtor class that they seize upon every device that is offered and recognize in each, the pan- acea for all their financial woes. It was so in 1896 and will be so as long as men owe more than they can pay.

In the elections of 1842, the old Relief party found itself again to the fore but only tempo- rarily so. The legislature when assembled, re- jected the measures offered by the Relief party having learned something by experience. But concessions were not denied and the more reasonable of the members of that party agreed to these and there was a practical ad- justment of conditions. Certain terms of the circuit courts and of the magistrates' courts, were for the time being discontinued, in or- der that judgments might not be had against helpless debtors. The banks were required to issue more money and to give longer accom- modation on their paper. Gradually business became more settled and by 1844, affairs had assumed practically their normal condition.

CHAPTER XLII.

INTERNAL IMPROVEMENTS-PUBLIC ROADS- RIVER IMPROVEMENTS -- OHIO CANAL --- FIRST RAILROAD WEST OF ALLEGHANIES-BREATHITT'S "JACKSONIAN ADMINISTRATION" -- SPEC- ULATIVE BUBBLE BURST-HARRISON ELECTED PRESIDENT-CLAY AGAIN DEFEATED.

There was a new subject now to hold the attention of the people of Kentucky. They had agonized under the weight of debts which they were unable to pay, and no people suffer greater from such a burden than Kentuckians. They enjoy being rich and having all that riches imply, but they do not enjoy being rich while owing money to other people. They de- sire that which is justly coming to them, but they desire more than all else that those to whom they owe money shall have it paid in full. There was a man in Louisville in those days who was unable to meet his obligation, and who was forced into bankruptcy. He kept a strict account of his indebtedness, and when better days came to him and he had ac- cumulated a fund sufficiently large to dis- charge his entire indebtedness with interest added, he called together his creditors and paid every one of them in full, principal and interest. The creditors who had no right to expect anything from the bankrupt house. tendered a testimonial to their debtor and it stands today in the business house of his hon- ored sons as a tribute to the honesty of Will- iam Kendrick.

The question of internal improvement now became paramount in Kentucky. There was so much which needed to be done and so little assistance which the counties could do. They were forced to look to the state, however much many persons might object to the state becoming a party to internal improvements. There were no railroads in these early days.

and the best that could be done in the im- provement of transportation was the turnpike road. Perhaps the first concessions for the construction of these roads was in 1802, when certain persons were authorized to construct and maintain turnpikes on the road from Cum- berland Gap to Crab Orchard, from Paris to the mouth of the Big Sandy, and other less important lines. In December, 1826, Gover- nor Desha advocated the extension of state aid to a highway from Maysville, by way of Paris, Lexington and Frankfort to Louisville, and, in addition, other lines of less importance. The first mentioned line was constructed and is yet in use, heing known by the old surviving resi- dents of its earlier days as the State Pike.

Governor Desha, while having constantly in mind, the value of internal improvements, did not forget the important feature of com- mon schools. In one of his messages he said : "The subjects of common schools and in- ternal improvements may be made auxiliary to each other. Let the School fund now in the Bank of the Commonwealth, $140,917, the proceeds of the sale of vacant lands, the bank stock held by the State, $721,238, and all other funds which can be raised hy other means than taxes on the people, be vested in the turnpike roads; and the net profits from tolls on these roads be sacredly devoted to the in- terests of education."

Smith, in his "History of Kentucky." says of this era in the State :

"In May, 1827, the Maysville and Lexing-

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ton Turnpike Company was incorporated anew, with a capital of three hundred and twenty thousand dollars. The general gov- ernment was expected to subscribe for one hundred thousand dollars and the state gov-

COURT HOUSE IN MAYSVILLE, CONSTRUCTED 1× 1840

ernment for another hundred thousand dollars of this. The secretary of war ordered the survey of a route for a great national highway from Zanesville, Ohio, through Maysville, Lexington, Nashville, Tennessee, and Flor- ence, Alabama, to New Orleans. In Febru- ary, 1828, the legislature of Kentucky recom- mended congress to facilitate and aid the con- struction of this important national highway and instructed the Kentucky representatives in congress to support the measure. The bill

passed the house but, by the coincidence of a very close vote, it was defeated in the senate by the unfortunate vote, in opposition. by Senator John Rowan of Kentucky, and at a time when President John Adams would read- ily have signed it.

"The total amount expended on the perma- nent improvement of navigation on Green and Barren rivers to Bowling Green, requiring four locks in Green and one in Barren, was $859.126. From 1843 to 1865, twenty-two years, thirteen annual dividends were paid out of the tolls on these rivers, yet, on the whole, the expenses were $269.813 against $265,002 of receipts, showing a total excess of $4,811 of expenses in twenty years. In the report of 1844, the board of internal improve- ment asserted that the works on Green river cost the state five times the estimate of 1833, and on Kentucky river, three to four times the estimate. The average cost per mile on Green river was $5,010, against the estimate of $1.283 for one hundred and eighty miles or nearly four-fold. Surveys and estimates were made for Rockcastle, upper and lower Cumberland, Goose Creek, and north fork of the Kentucky river, Salt, Little and Big Sandy, Licking and other rivers of less note. "In 1836, the estimated cost of seventeen locks and dams, after a survey from the mouth to Middle Fork of the Kentucky river, and on two hundred and fifty-seven miles of channel route, was $2,297.416, or an average of $8,922 per mile. But five of the locks and dams were completed, from the mouth of the river to Steele's ripple above Frankfort. The gross receipts of Kentucky river navigation from 1843 to 1865, twenty-three years, were $461.781, against a total of expenditures of $303.707, leaving a net revenue of $158,074, making an average annual dividend of three- fourths of one per cent on the invested capi- tal.

"Another enterprise of national importance quite early commanded the attention of the

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Kentucky legislature. In December, 1804, an act was passed incorporating the Ohio Canal Company, designed to construct a canal from Louisville to Portland with capacity to pass all boats by the Falls. The charter was afterwards amended, requiring the canal to be cut on the Kentucky side of the river, mak- ing it real estate and exempting it from all taxation forever. The governor was directed to subscribe for fifty thousand dollars of the five hundred thousand dollars stock capital, with an option for fifty thousand more. Other options were given for the United States to subscribe sixty thousand dollars; Pennsylva- nia and Virginia thirty thousand dollars each, and Maryland, New York and Ohio, twenty thousand each. Subsequent legislation pro- vided similarly for this work, without practi- cal results, until 1826, when Governor Desha, in his message to the legislature, called at- tention to the urgent necessity, and value of this work, both for its pressing utility and the value of the investment as a pecuniary re- source. In this same year, congress ordered the purchase of one hundred thousand dollars of the forfeited stock. As many as one thou- sand men were employed during the summer and fall of 1826. Various interruptions and changes retarded the completion of the canal, until it was finally opened for navigation in 1831. The entire cost of construction to Jan- uary, 1832, was $742,869.

"Until January, 1840, the reports of divi- dends showed that the investment was richly remunerative to the stockholders. In 1838 and 1839, the dividends reached fourteen and seventeen per cent, and, in the interim stock sold as high as $120 and $130 per share. The United States government, in 1842 owned 29,002 shares of the stock of the par value of $290,000. After this year, no dividends were declared, the net earnings up to 1859, being appropriated to the purchase of stock owned by private individuals which was held in trust by the directors. After 1859, the income was

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A history of Kentucky and Kentuckians; the leaders and representative men in commerce, industry and modern activities, Volume I, Part 37

Author: Johnson, E. Polk, 1844-; Lewis Publishing Company Publication date: 1912 Publisher: Chicago, Lewis Pub. Co. Number of Pages: 656

Author: Johnson, E. Polk, 1844-; Lewis Publishing Company
Publication date: 1912
Publisher: Chicago, Lewis Pub. Co.
Number of Pages: 656