Wall Street: A History Charles R Geisst

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WALL
STREET
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WALL
STREET
A H I S T O R Y

Fourth Edition

Charles R. Geisst

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1
Oxford University Press is a department of the University of Oxford. It furthers
the University’s objective of excellence in research, scholarship, and education
by publishing worldwide. Oxford is a registered trade mark of Oxford University
Press in the UK and certain other countries.

Published in the United States of America by Oxford University Press

198 Madison Avenue, New York, NY 10016, United States of America.

© Charles R. Geisst 1997

First published by Oxford University Press, Inc., 1997

First issued as an Oxford University Press paperback, 1999
Reissued in cloth & paperback by Oxford University Press, Inc., 2004
Reissued in paperback by Oxford University Press, Inc., 2012
Reissued in paperback by Oxford University Press, Inc., 2018

All rights reserved. No part of this publication may be reproduced, stored in

a retrieval system, or transmitted, in any form or by any means, without the
prior permission in writing of Oxford University Press, or as expressly permitted
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rights organization. Inquiries concerning reproduction outside the scope of the
above should be sent to the Rights Department, Oxford University Press, at the
address above.

You must not circulate this work in any other form

and you must impose this same condition on any acquirer.

Library of Congress Cataloging-in-Publication Data

Names: Geisst, Charles R., author.
Title: Wall Street : a history / Charles R. Geisst.
Description: Updated edition. | New York, NY : Oxford University Press, [2018] |
Includes bibliographical references and index.
Identifiers: LCCN 2017059880 (print) | LCCN 2018002074 (ebook) |
ISBN 9780190613556 (UPDF) | ISBN 9780190613563 (EPUB) |
ISBN 9780190613549 (pbk. : alk. paper)
Subjects: LCSH: Wall Street (New York, N.Y.)—History. | New York Stock Exchange.
Classification: LCC HG4572 (ebook) | LCC HG4572 .G4 2018 (print) |
DDC 332.64/273—dc23
LC record available at https://lccn.loc.gov/2017059880

1 3 5 7 9 8 6 4 2
Printed by Sheridan Books, Inc., United States of America
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For Margaret and Meg

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Contents

Preface ix
Introduction xi
One The Early Years (1790–1840) 1
Two The Railroad and Civil War Eras (1840–70) 29
Three The Robber Barons (1870–90) 58
Four The Age of the Trusts (1880–1910) 93
Five The Money Trust (1890–1920) 120
Six The Booming Twenties (1920–29) 149
Seven Wall Street Meets the New Deal (1930–35) 200
Eight The Struggle Continues (1936–54) 247
Nine Bull Market (1954–69) 276
Ten Bear Market (1970–81) 302
Eleven Mergermania (1982–97) 330
Twelve Running Out of Steam (1998–2003) 377
Thirteen The Cataclysm (2004–08) 404
Fourteen The Great Recession (2009–2013) 445
Fifteen Recovery, Tapers, and Tantrums (2014– ) 471

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viii Contents

Notes 499
Bibliography 519
Index 529
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Preface

The recent financial crisis has brought Wall Street history almost full
circle. The freewheeling days of the nineteenth and early twentieth cen-
turies were brought to an end by Depression-era laws designed to protect
the public from financial excesses that ended in bank failures and sharp
turns in economic cycles. The prosperity brought by a growing economy
and a strong dose of hubris on Wall Street caused pressure, and those
regulations were eventually jettisoned in the 1990s by deregulation that
brought back the good old days of financial excess.
Twenty years have passed since the first edition of this book appeared.
Since then, four new chapters in several editions have been added to
chronicle the tumultuous events since the late 1990s, including the dot.
com crisis, the demise of the Glass-Steagall Act, Enron, the housing boom
of the early 2000s, widespread changes in trading equities, new financial
products, and finally the credit crisis of 2008. The most recent chapter
covers events as the worst days of the Great Recession ended and a slow
recovery began. Some new material has been added on the first mortgage
securities crisis in the 1880s and credit market conditions leading to the
Crash of 1929.

Oradell, New Jersey

September 2017

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Introduction

This is the first history of Wall Street. From the Street’s earliest
beginnings, it has never had its own complete history chronicling the
major events in finance and government that changed the way securities
were created and traded. Despite its tradition of self-reliance, it has not
developed without outside influence. Over the years, government has had
a great deal to do with Wall Street’s development, more than financiers
would like to admit.
Like the society it reflects, Wall Street has grown extraordinarily
complicated over the last two centuries. New markets have sprung up,
functions have been divided, and the sheer size of trading volume has
expanded dramatically. But the core of the Street’s business would still
be recognized by a nineteenth-century trader. Daniel Drew and Jacob
Little would still recognize many trading techniques and basic finan-
cial instruments. Fortunately, their philosophies for taking advantage of
others have been replaced with investor protections and a bevy of securi-
ties laws designed to keep the poachers out of the henhouse, where they
had comfortably resided for almost 150 years.
Bull markets and bear markets are the stuff that Wall Street is made
of. The boom and bust cycle began early, when the Street was just an out-
door market in lower Manhattan. The first major trauma that shook the
market was a bubble brought on by rampant land speculation that shook
the very heart of New York’s infant financial community. In the inter-
vening two hundred years, much has changed, but the Street still has not
shaken off the boom and bust mentality. The bear market of the 1970s and

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xii Introduction

the recession of 1982 were followed by a bull market that lasted longer
than any other bull market except the one that began in the late 1950s.
Wall Street history has undergone several phases, which will be found
here in four distinct periods. The first is the early years, from 1790 to the
beginning of the Civil War. During this time, trading techniques were
developed and fortunes made that fueled the fires of legend and lore. The
second period, from the Civil War to 1929, encompassed the development
of the railways and the trusts, the robber barons, and most notably the
money trust. It was not until 1929 that the money trust actually lost its grip
on the financial system and became highly regulated four years later. Only
when the grip was broken did the country enter the modern period of
regulation and public accountability. The third period was relatively brief
but intense. Between 1929 and 1954 the markets felt the vise of regulation
as well as the effects of depression and war. The fourth and final period
began with the great bull market of the Eisenhower years that gave new
vitality to the markets and the economy.
Stock and bond financing began early, almost as soon as the new
Republic was born. During the early period, from the 1790s to the Civil
War, investors were a hardy breed. With no protection from sharp
practices, they were the victims of predators whose names have become
legends in Wall Street folklore. But the days of Drew, Little, and Vanderbilt
were limited. The second-generation robber barons who succeeded them
found a government more interested in developing regulations to restrain
their activities than in looking the other way.
The latter part of the nineteenth and the early twentieth centuries
saw a consolidation of American industry and, with it, Wall Street. The
great industrialists and bankers emerged during this time to create the
leviathan industrial trusts that dominated economic life for nearly half a
century. Although the oldest Wall Street firms were only about fifty years
old at the turn of the century, they were treated as aristocracy. The great
banking houses of Morgan, Lazard, and Belmont were relatively young
but came to occupy a central place in American life, eclipsing the influence
of the robber barons such as Jay Gould and Jim Fisk. Although the robber
barons were consolidators and builders in their own right, their market
tactics outlived their industrial prowess in the annals of the Street.
The modern era in the financial world began in 1934 when New Deal
legislation severely shackled trading practices. Investor protection became
the new watchword as stern new faces replaced the old guard that had
allowed the excesses of the past under the banner of free enterprise. The
new regulators were trustbusters whose particular targets were the finan-
cial community and the large utility holding companies. No longer would
nineteenth-century homespun philosophies espousing social Darwinism
be permitted to rule the Street. Big fish would no longer be able to gobble
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Introduction xiii

up small ones. Small fish now had rights and were protected by the new
federal securities laws.
The fourth phase of Wall Street’s history came in the late 1950s, when
the small investor became acquainted with the market. Many securities
firms began catering to retail customers in addition to their more tra-
ditional institutional clients such as insurance companies and pension
funds. With this new emphasis, the Street began to change its shape.
Large, originally retail-oriented firms emerged as the dominant houses.
The result was all-purpose securities firms catering to all sorts of clients,
replacing the white-shoe partnership firms of the past.
Since the Great Depression, the major theme that has dominated
the Street has been the relationship between banking and the securities
business. The two have been purposely separated since 1934 in order to
protect the banking system from market catastrophes such as the 1929
stock market crash. But as the world becomes more complex and commu-
nications technology improves, the old protections are quickly falling by
the wayside in favor of integrating all sorts of banking activities under one
roof. While this is the most recent concern on the Street, it certainly has
not been the only one.
Throughout its history, the personalities on Wall Street have always
loved a good anecdote. Perhaps no other segment of American business
has such a fondness for glib phrases and hero worship. Many of these
anecdotes have become part and parcel of Wall Street lore and are in-
cluded in this volume. They were particularly rampant in the nineteenth
century, when “great man” theories of history were in vogue. Prominent
figures steered the course of history while the less significant simply went
along for the ride. As time passed, such notions receded as society be-
came more complex and institutions grew and developed. But originally,
the markets and industrial society were dominated by towering figures
such as Andrew Carnegie, John D. Rockefeller, and J. P. Morgan. Even
the more typical robber barons such as Commodore Vanderbilt and Jay
Gould also were legends in their own time. Jay Gould became known as
“Mephistopheles,” Jay Cooke the “Modern Midas,” and J. P. Morgan the
“financial gorgon.” Much of early Wall Street history involves the inter-
play between these individuals and the markets. One of the great puzzles
of American history is just how long Wall Street and its dominant person-
alities were allowed to remain totally independent from any meaningful
source of outside interference despite growing concern over their power
and influence.
Several startling facts emerge from the Street’s two-hundred-year ex-
istence. When the Street was dominated by individuals and the banking
aristocracies, it was usually its own worst enemy. Fortunes were made and
lavishly spent, capturing the headlines. Some of the profits were given
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xiv Introduction

back to the public, but often the major impression was that market raiding
tactics were acts of collusion designed to outwit the smaller investors at
every turn. The major market falls and many banking crises were correctly
called “panics.” They were the results of investors and traders reacting
poorly to economic trends that beset the country. The major fear was that
money would be lost both to circumstance and to unscrupulous traders
more than willing to take advantage of every market weakness.
The crash of 1929 was the last old-fashioned panic. It was a crucible
in American history because, while more nineteenth than twentieth cen-
tury in flavor, it had no easy remedy. The major figures of the past such as
Pierpont Morgan were not there to help prop up the banking system with
their self-aggrandizing sense of public duty. The economy and the markets
had become too large for any individual or individuals to save. The con-
certed effort of the Wall Street banking community to rescue the market
in the aftermath of the crash proved to be too little too late. Investors had
been ruined and frightened away from a professional traders’ market. No
one group possessed the resources to put the economy on the right track.
America entered October 1929 very much still in the nineteenth century.
By 1933, when banking and securities legislation was passed, it had finally
entered the twentieth century. From that time on, the public demanded to
be protected from investment bankers, who became public enemy number
one during the 1930s.
Throughout its two-hundred-year history, Wall Street has come to
embrace all of the financial markets, not just those in New York City.
In its earliest days Wall Street was a thoroughfare built alongside a wall
designed to protect lower Manhattan from unfriendly Indians. The pre-
decessor of the New York Stock Exchange was founded shortly thereafter
to bring stock and bond trading indoors and make it more orderly. But
Wall Street today encompasses more than just the stock exchange. It is di-
vided into stock markets, bond markets of various sizes and shapes, as well
as commodity futures markets and other derivatives markets in Chicago,
Philadelphia, and Kansas City increasingly known for their complexity. In
the intervening years, other walls have been created to protect the public
from a “hostile” securities business. The sometimes uneasy relationship
between finance and government is the theme of Wall Street’s history.
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WALL
STREET
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 C H A P T E R O N E

The Early Years

(1790–1840)

Remember, time is money.

Benjamin Franklin

America in 1790 was a diverse place and a land of unparalleled

opportunity. The existing merchant class, mostly British and Dutch by
origin, had already carved out lucrative careers as merchant traders. They
made their livings in countless ways, but most revolved around trad-
ing essential commodities that Europeans coveted, such as furs, natural
resources, and tobacco. Land speculation was another area that drew atten-
tion because the Americans had an abundance of land and the Europeans
desired it probably more than any other type of property. In these endeav-
ors the great American fortunes—those of Girard, Astor, Biddle, and oth-
ers—would be made, and occasionally broken.
Most of America’s riches were based on an abundance of land. The
New World provided more than just space for the land-starved Europeans.
The millions of undeveloped acres west of the Alleghenies provided tangi-
ble proof that the extremely pessimistic demographic theories of Thomas
Malthus had a distinctly American antidote. “Population, when unchecked,
increases in a geometric ratio. Subsistence only increases in an arithmetic
ratio,” Malthus wrote in his 1798 Essay on the Principle of Population, sug-
gesting that the population was growing faster than food supplies. But
the abundance of North America was proof that pessimistic theories of
doom were misguided. The United States was the savior of overcrowded
Europe. Horace Greeley later wrote, “If you have no family or friends to
aid you, and no prospect open to you . . . turn your face to the great West
and there build up your fortune and your home.” By the time he wrote this
in 1846, at least two generations had already done so.

1
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With the abundance of land, food, furs, and minerals, the only con-
straint on accumulating wealth was self-imposed. Success was limited
only by lack of imagination. Trading with the Europeans and with the
Indians, manufacturing basic staples, and ship transportation all had been
pursued successfully by some of the country’s oldest, and newest, entre-
preneurs. The businessman providing these services was adding value to
other goods and services for a society that was hardly self-sufficient at the
time. Making money was smiled upon, almost expected, as long as some
basic rules of the game were followed. Others had to benefit as well from
entrepreneurship. A popular form of utilitarian philosophy was in vogue,
and America was proving to be its best laboratory. The Protestant ethic
had not yet disappeared, but leverage was not well accepted. Borrowing
money to become successful in business was becoming popular because it
was recognized as the only way that capitalism could be practiced in some
cases. But the practice was still not socially acceptable and also had a weak
institutional underpinning.
Between independence and the Civil War, land played the pivotal role
in American investments and dreams. The vast areas of the country and
its seemingly never-ending territories provided untold opportunities for
Americans and Europeans alike. They represented everything the Old
World could no longer offer—opportunity, space to grow, and investment
possibilities. The idea certainly never lost its allure. When early entrepre-
neurs borrowed large sums of money, it was often to purchase land in the
hope of selling it to someone else at a profit. Even after much land was
titled in the nineteenth century, its central role in American ideology was
never forgotten. Its role as the pivotal part of the American Dream is still
often used to describe the American experience on an individual level.
At the time of American independence, land was viewed less for
homeownership than for productive purposes. England had already been
stripped bare of many natural resources, and new lands were sought to
provide a new supply. The oak tree was already extinct in Britain, and
many hardwoods had to be imported. The sight of the vast Appalachian
forests proved tempting for the overcrowded and overtaxed Europeans
who coveted the timber, furs, and minerals that these vast expanses could
provide. Much land was also needed to provide the new addictive crop
craved by both Europeans and Americans—tobacco.
The desire to own property had also been deeply ingrained in the
European, and particularly English, imagination. In the previous century,
after Britain’s civil war, John Locke had argued forcefully for property as
an extension of man’s self. To deprive a man of property was to deprive
him of a basic right, as the framers of the American Constitution knew
well. Arguing persuasively in The Federalist Papers, James Madison stated,
“Government is instituted no less for protection of the property than
 The Early Years (1790–1840) 3

of the persons of individuals.”1 This constitutional principle would help

make property a central issue in American politics. But in the 1790s it was
still something of a novel concept that nevertheless presented opportuni-
ties for vast wealth. No sooner had the ink on the Constitution dried than
European investments in the new country increased substantially. Within
a few years, land speculation would cause the first financial crash on Wall
Street.
Despite the promise, doing business in colonial America in the
middle and late eighteenth century was not an easy matter. Each colony
had its own currency and jealously protected its own economic position,
even when the federal government was formed after independence. The
Constitution prohibited the states from coining their own money after
1789, but the chartered banks that would soon be established within the
states took up that task. In the early years of the new Republic, many of
the same problems persisted. The country was not the homogeneous place
that it was later to become. Business between merchant traders, the life-
line of the early economy, could be conducted in British pounds, French
francs, or Spanish doubloons, as well as the new American dollars. When
transactions proved especially risky, payment was often requested in spe-
cie—gold or silver bullion. In the absence of state or federal taxes or high
labor costs, great fortunes were amassed by the American merchant class.
But the marketplace was hardly as efficient as those of the mother coun-
tries, Britain and Holland. Basic institutions were still lacking. The new
US Treasury Department was not instituted until six months after George
Washington was sworn in as president in 1789.
Another institution the new country lacked was an organized stock
exchange, a place where shares in trading companies and early manufac-
turers could change hands. Without an organized exchange, commerce
in the new country would not develop quickly or well. Exchanges were
needed so that investors could become familiar with companies and their
products. Only when the merchants began turning their attention to pro-
viding money for new ventures did the idea of trading shares and bonds
become more attractive. A market for these sorts of intangible assets had
already existed in Europe for about a hundred years, but the idea was slow
in crossing the Atlantic.
The European stock exchanges, or bourses, as they were called, were
established in the seventeenth century as places where governments could
sell their own loans (bonds) and the large mercantile trading companies
could raise fresh cash for their overseas adventures. The Dutch devel-
oped their bourses first, as early as 1611, with the English following about
seventy-five years later. Besides trading commodities vital to the devel-
oping mercantilist trade, both bourses began to actively trade new con-
cepts in financing—shares and loans or bonds. Governments and the early
4 WALL STREET

trading companies began to look on private investors as sources of capital.

Borrowing from investors was preferable to raising taxes and certainly
much safer, for more than one British government had run into trouble
by overtaxing its citizens. Investors warmed to the idea of share owner-
ship because it limited their risk in an enterprise to the amount actually
invested in it. Although the partnership form of control was far from out-
dated, the new corporate concept began to take hold.
After the Revolutionary War, the new American federal government
immediately found itself in delicate financial straits, complicating matters
considerably. The first Congress met in New York City in 1789 and 1790.
The war debts of the former colonies and the Continental Congress were
all assumed by the new government. Unfortunately, it had little actual rev-
enues to pay for them. If the new Republic did not honor its existing debts,
progress would be difficult for new creditors would not be found easily. As
a result, the US government borrowed $80 million in New York by issu-
ing federal government bonds. Necessity became the mother of invention,
and the American capital markets, however humble, were born. But as Ben
Franklin was fond of saying, “Necessity never made a good bargain.”
The major competition for money came from basic industries and
financial institutions that were quickly establishing themselves in the
new country. Most of these institutions were American versions of British
trading companies and financial institutions well known in the colonies
before the war. Merchants, traders, and investors trusted these companies
much more than they did governments. As a result, the rate of inter-
est paid by the new government had to be fairly high to compensate,
but buyers still did not provide strong demand for the new bonds. After
having shaken off the yoke of British colonial domination, the entrepre-
neurs and merchants in New York, Boston, and Philadelphia were not
particularly keen to loan money to another government, especially one
as untested as the new federal government, which did not yet even have
a permanent home. As a result, many of the new government bond issues
were only partly sold.
The three major East Coast cities were the home of American capital-
ism in its infancy. Philadelphia had the distinction of being the home of
the first actual stock exchange, Boston continued as a shipping and bank-
ing center, and New York was the rapidly emerging center for financial
services such as insurance and banking. Although the government bonds
were sold in all three places and other major cities such as Baltimore and
Charleston as well, New York developed the first active market for the
bonds and the shares of emerging companies.
Local merchants and traders would gather at various locations in
lower Manhattan, around Wall Street, along a barricade built by Peter
Stuyvesant in 1653 to protect the early Dutch settlers from the local
 The Early Years (1790–1840) 5

Indians. There they congregated to buy and sell shares and loans (bonds).
As the nascent securities business quickly grew, the traders divided them-
selves into two classes—auctioneers and dealers. Auctioneers set the
prices, while dealers traded among themselves and with the auctioneers.
This early form of trading set a precedent that would become embedded
in American market practice for the next two hundred years. The only
problem was that the auctioneers were in the habit of rigging the price
of the securities.
The new market, conducted at the side of the street and in coffee-
houses, was a crude approximation of the European stock exchanges that
had existed for some time. The London and Antwerp stock exchanges
were quite advanced in raising capital and trading shares and bonds for
governments and the early mercantilist trading companies. The exchanges
developed primarily because both countries were the birthplaces of mod-
ern mercantilism and industrial capitalism. Equally, the British and the
Dutch exported much capital abroad, in hope of reaping profits from
overseas ventures. This was possible, and necessary, because both had
excess domestic capacity and money and were anxious to find new areas of
profit. And many years before the American Revolution, both had already
had their share of financial scandal, the South Sea bubble and tulip specu-
lation being two of the more noteworthy. These early scandals had proved
that sharp dealings and rampant speculation could seriously diminish the
enthusiasm of private investors, who were vital for the development of
industrial capitalism. The same situation prevailed in New York, where
the antics of an early speculator made raising money difficult in the mid-
dle and late 1790s.

“Fifteen Different Sorts of Wine at Dinner”

In March 1792 a local New York merchant speculator named William
Duer became overextended in his curbside dealings, and many of his
speculative positions collapsed. Having financed them with borrowed
money, he was quickly prosecuted and sent to debtors’ prison. Duer was
not, however, just another merchant intent on making a few dollars in the
marketplace. An immigrant from Britain before the Revolution, he had
been educated at Eton and was a member of a prominent English family
with extensive holdings in the West Indies. Duer permanently settled in
his adopted country in 1773, becoming sympathetic with the colonists’
grievances against Britain. Well acquainted with New York society, he
quickly began to hold positions of importance. He was a member of the
Continental Congress, a New York judge, and a signer of the Articles of
Confederation. He was also secretary to the Board of the Treasury, a posi-
tion that made him privy to the inner workings of American finance in the
6 WALL STREET

late 1780s. Having developed a keen knowledge of international finance,

he was intent on opening a New York bank capable of rivaling the great
British and Dutch merchant banking houses of the time.
Duer was especially well versed in the amounts of money invested in
the former colonies by the Dutch and English. Many of his real estate and
curbside speculative positions were assumed in anticipation of the inflow
of money from abroad. In 1787 he was closely involved in the Scioto spec-
ulation, in which he and some colleagues were granted rights to large
tracts of western lands that they intended to sell to foreign interests.
Unfortunately, the Treasury brought charges against him for malfeasance
that it claimed occurred when he was still occupying government office.
When the charges were brought, Duer was almost broke, having fully
margined himself to engage in his various securities undertakings. When
he became bankrupt, the entire curbside market quickly collapsed, and the
shock waves reverberated for several years while he languished in debtors’
prison.
Alexander Hamilton intervened on Duer’s behalf in 1797 but was able
to obtain only a short reprieve. Duer had been instrumental in helping
Hamilton establish the Bank of New York a decade earlier, but even the
intercession of his powerful friend was not enough to save him. This was
the first case of a mighty financier having fallen. During his heyday, Duer
often regaled his friends and associates at dinner at his home on Broadway,
not far from Wall Street, where Trinity Church is still located. He had
married Catherine Alexander, better known as “Lady Kitty,” the daugh-
ter of British officer Lord Stirling; at the wedding, the bride had been
given away by George Washington. Duer’s dinner parties were popular,
especially with Lady Kitty acting as hostess. As one contemporary said,
“Duer lives in the style of a nobleman. I presume that he had not less than
fifteen different sorts of wine at dinner and after the cloth was removed.”2
Perhaps it was his regal style that annoyed his prosecutors. After the brief
interlude arranged by Hamilton, Duer was returned to debtors’ prison,
where he eventually died in 1799.
The new marketplace took some time to recover from the unwind-
ing of his positions, and the banks recoiled at having lost money at a time
when the new federal government was pressing them for funds. Duer
had the distinction of being the first individual to use knowledge gained
from his official position to become entangled in speculative trading; in
effect, he was the first inside trader. What his inauspicious downfall dis-
played would have a serious impact on the marketplace throughout its
history. Duer joined the land-based speculation bandwagon like many of
his contemporaries, but in doing so he violated one of the premises of
eighteenth-century trading. America was still a conservative place where
the Protestant ethic was in full bloom. Ostentatious displays of wealth
 The Early Years (1790–1840) 7

were considered vulgar or evidence of dishonesty. Duer’s crimes were as

much those of taste as they were felonious. His British background and his
wife’s family connections did not help matters at a time when anti-English
sympathies were particularly high. New York laws concerning property
of foreigners and debts owed to them were among the harshest in the
country prior to the Constitution. After the British fled the city during
the war, the New York legislature passed the Confiscation Act in 1779,
allowing British loyalist interests to be seized. Several other laws were also
passed that illustrated New York’s distaste for its former colonial masters.
While Duer did not fall into that camp, he was suspect, as was George
Washington in some quarters, of being too pro-British. And his debts
were considered exorbitant, especially when frugality was being preached
by Alexander Hamilton, the first secretary of the Treasury. Even Thomas
Paine, the American pamphleteer who espoused many radical causes of
the day, was writing in favor of fiscal conservatism in the new Republic.
The prison sentence was remarkable for its severity, especially in light of
Duer’s role in New York society and his high political positions.
Within a month of Duer’s collapse and the crash that followed, the
auctioneers and dealers resolved to move themselves in from the street
and the coffeehouses and to find a more permanent location. Only the
previous summer, curbside dealings had become organized and auctions
were conducted twice per day. Now it became apparent that the mar-
ketplace needed a central location so that dealings could be better con-
trolled and better records kept. The New York state legislature helped
matters considerably by making the sale of federal or New York securities
issues illegal at auctions as they were currently conducted in order to pro-
vide some integrity to the market. In the early years of the market, it was
apparent that auctioneers were rigging prices to suit themselves rather
than provide fair prices for investors.
Recognizing the need to clean up their operations, the dealers and
auctioneers entered the Buttonwood Agreement in May 1792. Meeting
under a buttonwood tree, today the location of 68 Wall Street, the traders
agreed to establish a formal exchange for the buying and selling of shares
and loans. The new market would be more structured, conducted with-
out the manipulative auctions. This market would be continual through-
out the prescribed trading period, and a commission structure would be
established. All of those signing the agreement would charge each other a
standard commission for dealing. Those not signing but still intending to
trade would be charged a higher commission. Nonmembers either could
not afford the membership fee or refused to pay, preferring to keep their
curbside activities alfresco.
Purchases and sales of securities could be made in specie (gold or sil-
ver) or for cash, usually New York dollars issued by the banks. Obligations
8 WALL STREET

of the new government had to be made in US dollars. Government bonds

dominated trading in the 1790s, and it was not until 1798 that the first
new issue of a commercial enterprise appeared. The New York Insurance
Company finally came to market in 1798, having the distinction of being
the first new commercial issue after the market collapse caused by Duer.
During the period leading to the War of 1812, the only issues that joined
government bonds in the market were those of New York banks and insur-
ance companies. The first chartered American bank—the Bank of North
America, founded by Robert Morris and located in Philadelphia—was fol-
lowed by the Bank of New York in 1784.
Founded by Alexander Hamilton, the Bank of New York received its
state charter in 1791 and modeled itself closely on Morris’s bank, which
had proved highly successful. It would soon become a favorite of inves-
tors, partly because of the reputation of Hamilton himself. As secretary
of the Treasury, he had proposed full payment of the national debt and
tariffs to pay for government spending. He was renowned for his con-
servative fiscal policies. Most of the new banks that opened were incor-
porated and had to become state chartered as a result. State charters
ranged from difficult to very easy to obtain, depending on the locale.
The only banks that did not require a charter were private banks—
institutions that performed most of the functions of chartered banks
but did not issue their own currencies. New York was slowing eroding
Philadelphia’s position as banking center of the country. Pennsylvania
passed a law making private banks illegal, so in the future private bank-
ers looked toward New York as their home. One notable early example
of a private bank was Alexander Brown and Sons in New York, later to
become Brown Brothers Harriman, one of the few banks to remain pri-
vate until the present day. One of the chartered banks’ major functions
soon would become lending money to market speculators and investors
in addition to the usual loans made to merchants. That link would pro-
vide a close tie to the securities markets that would never be effectively
severed.
The bond influence was stronger than that of stocks. Issues of both
stocks and bonds were quoted on a premium, or discount, basis. Regardless
of the type of issue, a par value was always established when the security
was first sold. Dealers would quote premiums or discounts from par rather
than simply the day’s actual price as compared with the previous day’s
price. Most deals were for cash, but some forward contracts, called time
bargains, also could be arranged. Under this arrangement, delivery was for
some time in the near future at a price arranged on the day the deal was
struck. But this sort of dealing was highly risky because it depended almost
entirely on a verbal agreement between interested parties.
 The Early Years (1790–1840) 9

The First Central Bank

When the first Congress met, one of its original orders of business was to
establish the Bank of the United States, which was incorporated in 1791.
The main office was located in Philadelphia, with branch offices in New
York and other major East Coast cities. Unlike many of the chartered com-
mercial banks of the period, the central bank was provided with branches
in other states, a practice that annoyed many state bankers, who felt they
were held at a comparative disadvantage since they were confined to their
home states. In fact, the branches crystallized the opposition to the bank
more so than its role as the central bank. Local merchants, many of whom
were in the process of setting up state-chartered banks, did not want any
competition or regulation from a federal entity.3 When the central bank
was dissolved in 1811 after its charter was allowed to lapse, more than 120
state banks were already chartered. Many had begun their own note issu-
ance, and within a few years many had flooded the market with paper,
prompting the government to resort to specie payments in 1817. The abil-
ity to print notes was a power that many new banks and their owners were
loath to surrender to a strong central bank.
Originally, the Bank of the United States was one of the first hot
stock issues in American history, but its own short but troubled history
reflected the divisions still rampant in the new country. Even though it
proved highly profitable to its shareholders, profits were not enough to
save it in the long run. The issue was well subscribed, but it was not the
sort to be traded by the auctioneers and dealers on Wall Street and in the
Tontine Coffee House, the favorite watering hole of the merchant traders.
The original capital of the bank was set at $10 million, with the federal
government subscribing to $2 million. In return, the bank loaned $2 mil-
lion to the government at 6 percent interest, to be repaid in ten equal
installments. The bank also served as the government’s fiscal agent. The
public was allowed to subscribe to the remaining $8 million. However,
in contemporary terms, most of the public subscriptions went into insti-
tutional hands. Unfortunately for the bank, those institutional investors
were mostly foreign. The more substantial domestic merchants of the
time subscribed to the balance.
While the structure of the Bank of the United States was relatively
simple and its capital was readily supplied by investors, it fell into the
greater ideological controversy concerning the role of the federal govern-
ment in the new Republic. In 1791 Thomas Jefferson had expressed his
own reservations about the ability of the federal government to charter
a private company, which the bank remained throughout its brief history.
Although part of that particular controversy would be settled in 1819, there
10 WALL STREET

The Tontine Coffee House, 1793.

was also the fear that the bank would evolve into a strong central institu-
tion fashioned after the Bank of England—the second oldest central bank,
dating from 1694. The “Old Lady of Threadneedle Street,” as it became
known, acquired a monopoly over the issuance of bank notes that would
certainly not have been readily accepted in the United States at the time.
At the same time, other banks began depositing money with it, using it as
a clearinghouse for their transactions, meaning it could dictate the type of
currency it would accept. The sort of centralized power that the Old Lady
was acquiring did not please those in the United States who were more
interested in states’ rights than federal prerogatives.
Part of Bank of the United States’ problems could be traced to its
private investors. Of the $8 million available for public subscription,
more than $7 million was subscribed by foreigners, mostly British. Many
British investments in the United States were represented by the bank-
ing house of Baring, later Baring Brothers. As early as 1803, Barings had
been appointed official agents of the US government and would repre-
sent British interests for years to come. The company had helped finance
the Louisiana Purchase. Along with Treasury bonds, financial institutions
 The Early Years (1790–1840) 11

in general were favorite investments of Britons in the immediate post-

colonial period. But the idea of having the bank, effectively the central
bank of the country, in foreign hands proved too much of a risk for many.
Naturally, the ownership question played into the political hands. A Mr.
Desha, congressman from Kentucky, feared that George III was a major
shareholder. Given the king’s mental state at the time (reputedly on the
verge of madness), Desha claimed it was not wise to be held ransom by
such investors, although he conceded that George would probably pay
millions for the renewal of the charter in 1811.4
The bank was liquidated after Congress refused to renew its charter in
1811. In the twenty years in which it operated, it yielded investors about 8
percent per year in dividends and netted them about 57 percent in capital
gains. The federal government netted more than $600,000 on its initial
investment.5 Yet feelings were so strong about the bank’s role in the devel-
oping national government that it could not find enough support, and its
charter expired. The British investors had their subscriptions returned just
before the outbreak of the War of 1812. The return of their funds became
an important chapter in American finance because it showed that the gov-
ernment was willing to do business on an impartial basis, and that would
influence future British investments for decades to come. One of the larg-
est domestic investors at the time of liquidation was Stephen Girard of
Philadelphia.
Immediately after the hostilities, British and other foreign interests
in federal government debt began to wane. The reduction was to prove
temporary, however. British and Dutch holdings of Treasury securities
amounted to more than one-half of the amount outstanding in 1803,
although they declined to about 25 percent by 1818. Other foreign inves-
tors came from the mercantilist economies in Europe but were fairly
insignificant.6 Despite what proved to be a temporary lack of interest, the
tradition of British and Dutch investments, established in the early days
of the markets, would be reestablished and continue for well more than a
century.
Between 1790 and 1817 a permanent central location for the New
York stock exchange was never established, although auctions were aban-
doned. Dealers operated in over-the-counter fashion, buying and sell-
ing among themselves without officially congregating to set a price for
a security. Government bonds became more popular and accounted for
about one-third of all securities traded in this period. When the War of
1812 intervened, causing speculative activity to grind to a halt, the gov-
ernment issued bonds to pay for the war effort. The image of the British
setting Washington, DC, and the White House afire in 1814 did not boost
investors’ confidence. And many British investments in the United States
were prudently liquidated so as not to appear to be financing the enemy.
12 WALL STREET

Wall Street 1832 with branch of the Bank of the United States in center.

Many of these investments were also needed for the war effort against
Napoleon. When some of these sales occurred, it became publicly appar-
ent for the first time that many investments in the United States origi-
nated from British investors, a phenomenon to be seen again and again
throughout the nineteenth century.
During the war a spate of new issues also appeared for commercial
enterprises in addition to those of the government. In 1812, four new bank
stocks appeared for the Franklin Bank, City Bank, Phoenix Bank, and the
Bank of America. New York City also entered the market with a new bond
issue. Shortly thereafter, stocks appeared for nonfinancial companies.
Canal stocks became investor favorites, with those of the Erie Canal prov-
ing especially popular in New York City. The first life insurance company
in the country—the Philadelphia Company for Insurance on Lives and
Granting Annuities—was chartered in Philadelphia in 1812 as well. The
insurance companies that had proved popular in the markets prior to that
time were mostly maritime and casualty companies.
The government’s offering of war bonds did not fare well initially,
although it did eventually net several “underwriters” a fair profit. In
February the Treasury attempted to raise $16 million to finance the war
Another random document with
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 2. That the true mission of American democracy is to maintain the
liberties of the people, the sovereignty of the states, and the
perpetuity of the Union, by the impartial application of public affairs,
without sectional discriminations, of the fundamental principles of
human rights, strict justice, and an economical administration.
3. That the Federal government is one of limited powers derived
solely from the constitution, and the grants of power therein ought to
be strictly construed by all the departments and agents of the
government, and it is inexpedient and dangerous to exercise doubtful
constitutional powers.
4. That the constitution of the United States, ordained to form a
more perfect Union, to establish justice, and secure the blessings of
liberty, expressly denies to the general government all power to
deprive any person of life, liberty, or property, without due process of
law; and, therefore, the government, having no more power to make
a slave than to make a king, and no more power to establish slavery
than to establish a monarchy, should at once proceed to relieve itself
from all responsibility for the existence of slavery, wherever it
possesses constitutional power to legislate for its extinction.
5. That, to the persevering and importunate demands of the slave
power for more slave states, new slave territories, and the
nationalization of slavery, our distinct and final answer is—no more
slave states, no slave territory, no nationalized slavery, and no
national legislation for the extradition of slaves.
6. That slavery is a sin against God, and a crime against man,
which no human enactment nor usage can make right; and that
Christianity, humanity, and patriotism alike demand its abolition.
7. That the Fugitive Slave Act of 1850 is repugnant to the
constitution, to the principles of the common law, to the spirit of
Christianity, and to the sentiments of the civilized world; we,
therefore, deny its binding force on the American people, and
demand its immediate and total repeal.
8. That the doctrine that any human law is a finality, and not
subject to modification or repeal, is not in accordance with the creed
of the founders of our government, and is dangerous to the liberties
of the people.
 9. That the acts of Congress, known as the Compromise measures
of 1850, by making the admission of a sovereign state contingent
upon the adoption of other measures demanded by the special
interests of slavery; by their omission to guarantee freedom in the
free territories; by their attempt to impose unconstitutional
limitations on the powers of Congress and the people to admit new
states; by their provisions for the assumption of five millions of the
state debt of Texas, and for the payment of five millions more, and
the cession of large territory to the same state under menace, as an
inducement to the relinquishment of a groundless claim; and by
their invasion of the sovereignty of the states and the liberties of the
people, through the enactment of an unjust, oppressive, and
unconstitutional fugitive slave law, are proved to be inconsistent
with all the principles and maxims of democracy, and wholly
inadequate to the settlement of the questions of which they are
claimed to be an adjustment.
10. That no permanent settlement of the slavery question can be
looked for except in the practical recognition of the truth that slavery
is sectional and freedom national; by the total separation of the
general government from slavery, and the exercise of its legitimate
and constitutional influence on the side of freedom; and by leaving to
the states the whole subject of slavery and the extradition of fugitives
from service.
11. That all men have a natural right to a portion of the soil; and
that as the use of the soil is indispensable to life, the right of all men
to the soil is as sacred as their right to life itself.
12. That the public lands of the United States belong to the people
and should not be sold to individuals nor granted to corporations,
but should be held as a sacred trust for the benefit of the people, and
should be granted in limited quantities, free of cost, to landless
settlers.
13. That due regard for the Federal constitution, a sound
administrative policy, demand that the funds of the general
government be kept separate from banking institutions; that inland
and ocean postage should be reduced to the lowest possible point;
that no more revenue should be raised than is required to defray the
strictly necessary expenses of the public service and to pay off the
public debt; and that the power and patronage of the government
should be diminished by the abolition of all unnecessary offices,
salaries and privileges, and by the election of the people of all civil
officers in the service of the United States, so far as may be
consistent with the prompt and efficient transaction of the public
business.
14. That river and harbor improvements, when necessary to the
safety and convenience of commerce with foreign nations, or among
the several states, are objects of national concern; and it is the duty
of Congress, in the exercise of its constitutional powers, to provide
for the same.
15. That emigrants and exiles from the old world should find a
cordial welcome to homes of comfort and fields of enterprise in the
new; and every attempt to abridge their privilege of becoming
citizens and owners of soil among us ought to be resisted with
inflexible determination.
16. That every nation has a clear right to alter or change its own
government, and to administer its own concerns in such manner as
may best secure the rights and promote the happiness of the people;
and foreign interference with that right is a dangerous violation of
the law of nations, against which all independent governments
should protest, and endeavor by all proper means to prevent; and
especially is it the duty of the American government, representing
the chief republic of the world, to protest against, and by all proper
means to prevent, the intervention of kings and emperors against
nations seeking to establish for themselves republican or
constitutional governments.
17. That the independence of Hayti ought to be recognized by our
government, and our commercial relations with it placed on the
footing of the most favored nations.
18. That as by the constitution, “the citizens of each state shall be
entitled to all the privileges and immunities of citizens in the several
states,” the practice of imprisoning colored seamen of other states,
while the vessels to which they belong lie in port, and refusing the
exercise of the right to bring such cases before the Supreme Court of
the United States, to test the legality of such proceedings, is a
flagrant violation of the constitution, and an invasion of the rights of
the citizens of other states, utterly inconsistent with the professions
made by the slaveholders, that they wish the provisions of the
constitution faithfully observed by every state in the Union.
19. That we recommend the introduction into all treaties hereafter
to be negotiated between the United States and foreign nations, of
some provision for the amicable settlement of difficulties by a resort
to decisive arbitrations.
20. That the free democratic party is not organized to aid either
the Whig or Democratic wing of the great slave compromise party of
the nation, but to defeat them both; and that repudiating and
renouncing both as hopelessly corrupt and utterly unworthy of
confidence, the purpose of the Free Democracy is to take possession
of the Federal government and administer it for the better protection
of the rights and interests of the whole people.
21. That we inscribe on our banner Free Soil, Free Speech, Free
Labor, and Free Men, and under it will fight on and fight ever, until a
triumphant victory shall reward our exertions.
22. That upon this platform, the convention presents to the
American people, as a candidate for the office of President of the
United States, John P. Hale, of New Hampshire, and as a candidate
for the office of Vice-President of the United States, George W.
Julian, of Indiana, and earnestly commend them to the support of all
freemen and all parties.

1856.—The American Platform.

Adopted at Philadelphia February 21.

1. An humble acknowledgment to the Supreme Being for His
protecting care vouchsafed to our fathers in their successful
revolutionary struggle, and hitherto manifested to us, their
descendants, in the preservation of the liberties, the independence,
and the union of these states.
2. The perpetuation of the Federal Union and constitution, as the
palladium of our civil and religious liberties, and the only sure
bulwarks of American independence.
3. Americans must rule America; and to this end native-born
citizens should be selected for all state, federal, and municipal offices
of government employment, in preference to all others. Nevertheless,
4. Persons born of American parents residing temporarily abroad,
should be entitled to all the rights of native-born citizens.
5. No person should be selected for political station (whether of
native or foreign birth), who recognizes any allegiance or obligation
of any description to any foreign prince, potentate, or power, or who
refuses to recognize the federal and state constitutions (each within
its sphere) as paramount to all other laws, as rules of political action.
6. The unequaled recognition and maintenance of the reserved
rights of the several states, and the cultivation of harmony and
fraternal good will between the citizens of the several states, and, to
this end, non-interference by Congress with questions appertaining
solely to the individual states, and non-intervention by each state
with the affairs of any other state.
7. The recognition of the right of native-born and naturalized
citizens of the United States, permanently residing in any territory
thereof, to frame their constitution and laws, and to regulate their
domestic and social affairs in their own mode, subject only to the
provisions of the federal constitution, with the privilege of admission
into the Union whenever they have the requisite population for one
Representative in Congress: Provided, always, that none but those
who are citizens of the United States under the constitution and laws
thereof, and who have a fixed residence in any such territory, ought
to participate in the formation of the constitution or in the
enactment of laws for said territory or state.
8. An enforcement of the principles that no state or territory ought
to admit others than citizens to the right of suffrage or of holding
political offices of the United States.
9. A change in the laws of naturalization, making a continued
residence of twenty-one years, of all not heretofore provided for, an
indispensable requisite for citizenship hereafter, and excluding all
paupers and persons convicted of crime from landing upon our
shores; but no interference with the vested rights of foreigners.
10. Opposition to any union between church and state; no
interference with religious faith or worship; and no test oaths for
office.
 11. Free and thorough investigation into any and all alleged abuses
of public functionaries, and a strict economy in public expenditures.
12. The maintenance and enforcement of all laws constitutionally
enacted, until said laws shall be repealed, or shall be declared null
and void by competent judicial authority.
13. Opposition to the reckless and unwise policy of the present
administration in the general management of our national affairs,
and more especially as shown in removing “Americans” (by
designation) and conservatives in principle, from office, and placing
foreigners and ultraists in their places; as shown in a truckling
subserviency to the stronger, and an insolent and cowardly bravado
towards the weaker powers; as shown in reopening sectional
agitation, by the repeal of the Missouri Compromise; as shown in
granting to unnaturalized foreigners the right of suffrage in Kansas
and Nebraska; as shown in its vacillating course on the Kansas and
Nebraska question; as shown in the corruptions which pervade some
of the departments of the government; as shown in disgracing
meritorious naval officers through prejudice or caprice; and as
shown in the blundering mismanagement of our foreign relations.
14. Therefore, to remedy existing evils and prevent the disastrous
consequences otherwise resulting therefrom, we would build up the
“American Party” upon the principles hereinbefore stated.
15. That each state council shall have authority to amend their
several constitutions, so as to abolish the several degrees, and
substitute a pledge of honor, instead of other obligations, for
fellowship and admission into the party.
16. A free and open discussion of all political principles embraced
in our platform.

1856.—Democratic Platform,

Adopted at Cincinnati, June 6.

Resolved, That the American democracy place their trust in the
intelligence, the patriotism, and discriminating justice of the
American people.
 Resolved, That we regard this as a distinctive feature of our
political creed, which we are proud to maintain before the world as a
great moral element in a form of government springing from and
upheld by the popular will; and we contrast it with the creed and
practice of federalism, under whatever name or form, which seeks to
palsy the will of the constituent, and which conceives no imposture
too monstrous for the popular credulity.
Resolved, therefore, That entertaining these views, the Democratic
party of this Union, through their delegates, assembled in general
convention, coming together in a spirit of concord, of devotion to the
doctrines and faith of a free representative government, and
appealing to their fellow-citizens for the rectitude of their intentions,
renew and reassert, before the American people, the declaration of
principles avowed by them, when, on former occasions, in general
convention, they have presented their candidates for the popular
suffrage.
1. That the Federal government is one of limited power, derived
solely from the constitution, and the grants of power made therein
ought to be strictly construed by all the departments and agents of
the government, and that it is inexpedient and dangerous to exercise
doubtful constitutional powers.
2. That the constitution does not confer upon the general
government the power to commence and carry on a general system
of internal improvements.
3. That the constitution does not confer authority upon the Federal
government, directly or indirectly, to assume the debts of the several
states, contracted for local and internal improvements or other state
purposes; nor would such assumption be just or expedient.
4. That justice, and sound policy forbid the Federal government to
foster one branch of industry to the detriment of another, or to
cherish the interests of one portion of our common country; that
every citizen and every section of the country has a right to demand
and insist upon an equality of rights and privileges, and a complete
and ample protection of persons and property from domestic
violence and foreign aggression.
5. That it is the duty of every branch of the government to enforce
and practice the most rigid economy in conducting our public affairs,
and that no more revenue ought to be raised than is required to
defray the necessary expenses of the government and gradual but
certain extinction of the public debt.
6. That the proceeds of the public lands ought to be sacredly
applied to the national objects specified in the constitution, and that
we are opposed to any law for the distribution of such proceeds
among the states, as alike inexpedient in policy and repugnant to the
constitution.
7. That Congress has no power to charter a national bank; that we
believe such an institution one of deadly hostility to the best interests
of this country, dangerous to our republican institutions and the
liberties of the people, and calculated to place the business of the
country within the control of a concentrated money power and above
the laws and will of the people; and the results of the democratic
legislation in this and all other financial measures upon which issues
have been made between the two political parties of the country,
have demonstrated to candid and practical men of all parties their
soundness, safety, and utility in all business pursuits.
8. That the separation of the moneys of the government from
banking institutions is indispensable to the safety of the funds of the
government and the rights of the people.
9. That we are decidedly opposed to taking from the President the
qualified veto power, by which he is enabled, under restrictions and
responsibilities amply sufficient to guard the public interests, to
suspend the passage of a bill whose merits can not secure the
approval of two-thirds of the Senate and House of Representatives,
until the judgment of the people can be obtained thereon, and which
has saved the American people from the corrupt and tyrannical
dominion of the Bank of the United States and from a corrupting
system of general internal improvements.
10. That the liberal principles embodied by Jefferson in the
Declaration of Independence, and sanctioned in the Constitution,
which makes ours the land of liberty and the asylum of the oppressed
of every nation, have ever been cardinal principles in the democratic
faith; and every attempt to abridge the privilege of becoming citizens
and owners of soil among us, ought to be resisted with the same
spirit which swept the alien and sedition laws from our statute
books.
 And whereas, Since the foregoing declaration was uniformly
adopted by our predecessors in national conventions, an adverse
political and religious test has been secretly organized by a party
claiming to be exclusively Americans, and it is proper that the
American democracy should clearly define its relations thereto; and
declare its determined opposition to all secret political societies, by
whatever name they may be called—
Resolved, That the foundation of this union of states having been
laid in, and its prosperity, expansion, and pre-eminent example in
free government built upon, entire freedom of matters of religious
concernment, and no respect of persons in regard to rank or place of
birth, no party can justly be deemed national, constitutional, or in
accordance with American principles, which bases its exclusive
organization upon religious opinions and accidental birthplace. And
hence a political crusade in the nineteenth century, and in the United
States of America, against Catholics and foreign born, is neither
justified by the past history or future prospects of the country, nor in
unison with the spirit of toleration and enlightened freedom which
peculiarly distinguishes the American system of popular
government.
Resolved, That we reiterate with renewed energy of purpose the
well-considered declarations of former conventions upon the
sectional issue of domestic slavery, and concerning the reserved
rights of the states—
1. That Congress has no power under the constitution to interfere
with or control the domestic institutions of the several states, and
that all such states are the sole and proper judges of everything
appertaining to their own affairs not prohibited by the constitution;
that all efforts of the Abolitionists or others, made to induce
Congress to interfere with questions of slavery, or to take incipient
steps in relation thereto, are calculated to lead to the most alarming
and dangerous consequences, and that all such efforts have an
inevitable tendency to diminish the happiness of the people and
endanger the stability and permanency of the Union, and ought not
to be countenanced by any friend of our political institutions.
2. That the foregoing proposition covers and was intended to
embrace the whole subject of slavery agitation in Congress, and
therefore the Democratic party of the Union, standing on this
national platform, will abide by and adhere to a faithful execution of
the acts known as the compromise measures, settled by the Congress
of 1850—“the act for reclaiming fugitives from service or labor”
included; which act, being designed to carry out an express provision
of the constitution, can not, with fidelity thereto, be repealed, or so
changed as to destroy or impair its efficiency.
3. That the Democratic party will resist all attempts at renewing in
Congress, or out of it, the agitation of the slavery question, under
whatever shape or color the attempt may be made.
4. That the Democratic party will faithfully abide by and uphold
the principles laid down in the Kentucky and Virginia resolutions of
1792 and 1798, and in the report of Mr. Madison to the Virginia
legislature in 1799; that it adopts these principles as constituting one
of the main foundations of its political creed, and is resolved to carry
them out in their obvious meaning and import.
And that we may more distinctly meet the issue on which a
sectional party, subsisting exclusively on slavery agitation, now relies
to test the fidelity of the people, north and south, to the constitution
and the Union—*
1. Resolved, That claiming fellowship with and desiring the co-
operation of all who regard the preservation of the Union under the
constitution as the paramount issue, and repudiating all sectional
parties and platforms concerning domestic slavery which seek to
embroil the states and incite to treason and armed resistance to law
in the territories, and whose avowed purpose, if consummated, must
end in civil war and disunion, the American democracy recognize
and adopt the principles contained in the organic laws establishing
the territories of Nebraska and Kansas, as embodying the only sound
and safe solution of the slavery question, upon which the great
national idea of the people of this whole country can repose in its
determined conservation of the Union, and non-interference of
Congress with slavery in the territories or in the District of Columbia.
2. That this was the basis of the compromise of 1850, confirmed by
both the Democratic and Whig parties in national conventions,
ratified by the people in the election of 1852, and rightly applied to
the organization of the territories in 1854.
 3. That by the uniform application of the Democratic principle to
the organization of territories and the admission of new states, with
or without domestic slavery, as they may elect, the equal rights of all
the states will be preserved intact, the original compacts of the
constitution maintained inviolate, and the perpetuity and expansion
of the Union insured to its utmost capacity of embracing, in peace
and harmony, every future American state that may be constituted or
annexed with a republican form of government.
Resolved, That we recognize the right of the people of all the
territories, including Kansas and Nebraska, acting through the
legally and fairly expressed will of the majority of the actual
residents, and whenever the number of their inhabitants justifies it,
to form a constitution, with or without domestic slavery, and be
admitted into the Union upon terms of perfect equality with the
other states.
Resolved, finally, That in view of the condition of the popular
institutions in the old world (and the dangerous tendencies of
sectional agitation, combined with the attempt to enforce civil and
religious disabilities against the rights of acquiring and enjoying
citizenship in our own land), a high and sacred duty is devolved, with
increased responsibility, upon the Democratic party of this country,
as the party of the Union, to uphold and maintain the rights of every
state, and thereby the union of the states, and to sustain and advance
among us constitutional liberty, by continuing to resist all
monopolies and exclusive legislation for the benefit of the few at the
expense of the many, and by a vigilant and constant adherence to
those principles and compromises of the constitution which are
broad enough and strong enough to embrace and uphold the Union
as it was, the Union as it is, and the Union as it shall be, in the full
expression of the energies and capacity of this great and progressive
people.
1. Resolved, That there are questions connected with the foreign
policy of this country which are inferior to no domestic questions
whatever. The time has come for the people of the United States to
declare themselves in favor of free seas and progressive free trade
throughout the world, and, by solemn manifestations, to place their
moral influence at the side of their successful example.
 2. Resolved, That our geographical and political position with
reference to the other states of this continent, no less than the
interest of our commerce and the development of our growing
power, requires that we should hold sacred the principles involved in
the Monroe doctrine. Their bearing and import admit of no
misconstruction, and should be applied with unbending rigidity.
3. Resolved, That the great highway which nature, as well as the
assent of states most immediately interested in its maintenance, has
marked out for free communication between the Atlantic and Pacific
oceans, constitutes one of the most important achievements realized
by the spirit of modern times, in the unconquerable energy of our
people; and that result would be secured by a timely and efficient
exertion of the control which we have the right to claim over it; and
no power on earth should be suffered to impede or clog its progress
by any interference with relations that may suit our policy to
establish between our government and the governments of the states
within whose dominions it lies; we can under no circumstances
surrender our preponderance in the adjustment of all questions
arising out of it.
4. Resolved, That in view of so commanding an interest, the people
of the United States cannot but sympathize with the efforts which are
being made by the people of Central America to regenerate that
portion of the continent which covers the passage across the inter-
oceanic isthmus.
5. Resolved, That the Democratic party will expect of the next
administration that every proper effort be made to insure our
ascendency in the Gulf of Mexico, and to maintain permanent
protection to the great outlets through which are emptied into its
waters the products raised out of the soil and the commodities
created by the industry of the people of our western valleys and of
the Union at large.
6. Resolved, That the administration of Franklin Pierce has been
true to Democratic principles, and, therefore, true to the great
interests of the country; in the face of violent opposition, he has
maintained the laws at home and vindicated the rights of American
citizens abroad, and, therefore, we proclaim our unqualified
admiration of his measures and policy.
 1856.—Republican Platform,

Adopted at Philadelphia, June 17.

This convention of delegates, assembled in pursuance of a call
addressed to the people of the United States, without regard to past
political differences or divisions, who are opposed to the repeal of the
Missouri Compromise, to the policy of the present administration, to
the extension of slavery into free territory; in favor of admitting
Kansas as a free state, of restoring the action of the Federal
government to the principles of Washington and Jefferson; and who
purpose to unite in presenting candidates for the offices of President
and Vice-President, do resolve as follows:
Resolved, That the maintenance of the principles promulgated in
the Declaration of Independence, and embodied in the federal
constitution, is essential to the preservation of our Republican
institutions, and that the federal constitution, the rights of the states,
and the union of the states, shall be preserved.
Resolved, That with our republican fathers we hold it to be a self-
evident truth that all men are endowed with the inalienable rights to
life, liberty, and the pursuit of happiness, and that the primary object
and ulterior design of our Federal government were, to secure these
rights to all persons within its exclusive jurisdiction; that as our
republican fathers, when they had abolished slavery in all our
national territory, ordained that no person should be deprived of life,
liberty, or property, without due process of law, it becomes our duty
to maintain this provision of the constitution against all attempts to
violate it for the purpose of establishing slavery in any territory of the
United States, by positive legislation, prohibiting its existence or
extension therein. That we deny the authority of Congress, of a
territorial legislature, of any individual or association of individuals,
to give legal existence to slavery in any territory of the United States,
while the present constitution shall be maintained.
Resolved, That the constitution confers upon Congress sovereign
power over the territories of the United States for their government,
and that in the exercise of this power it is both the right and the
imperative duty of Congress to prohibit in the territories those twin
relics of barbarism—polygamy and slavery.
 Resolved, That while the constitution of the United States was
ordained and established, in order to form a more perfect union,
establish justice, insure domestic tranquillity, provide for the
common defense, promote the general welfare, and secure the
blessings of liberty, and contains ample provisions for the protection
of the life, liberty, and property of every citizen, the dearest
constitutional rights of the people of Kansas have been fraudulently
and violently taken from them; their territory has been invaded by an
armed force; spurious and pretended legislative, judicial, and
executive officers have been set over them, by whose usurped
authority, sustained by the military power of the government,
tyrannical and unconstitutional laws have been enacted and
enforced; the rights of the people to keep and bear arms have been
infringed; test oaths of an extraordinary and entangling nature have
been imposed, as a condition of exercising the right of suffrage and
holding office; the right of an accused person to a speedy and public
trial by an impartial jury has been denied; the right of the people to
be secure in their persons, houses, papers, and effects against
unreasonable searches and seizures, has been violated; they have
been deprived of life, liberty, and property without due process of
law; that the freedom of speech and of the press has been abridged;
the right to choose their representatives has been made of no effect;
murders, robberies, and arsons have been instigated or encouraged,
and the offenders have been allowed to go unpunished; that all these
things have been done with the knowledge, sanction, and
procurement of the present national administration; and that for this
high crime against the constitution, the Union, and humanity, we
arraign the administration, the President, his advisers, agents,
supporters, apologists, and accessories, either before or after the
facts, before the country and before the world; and that it is our fixed
purpose to bring the actual perpetrators of these atrocious outrages,
and their accomplices, to a sure and condign punishment hereafter.
Resolved, That Kansas should be immediately admitted as a state
of the Union with her present free constitution, as at once the most
effectual way of securing to her citizens the enjoyment of the rights
and privileges to which they are entitled, and of ending the civil strife
now raging in her territory.
 Resolved, That the highwayman’s plea that “might makes right,”
embodied in the Ostend circular, was in every respect unworthy of
American diplomacy, and would bring shame and dishonor upon any
government or people that gave it their sanction.
Resolved, That a railroad to the Pacific ocean, by the most central
and practicable route, is imperatively demanded by the interests of
the whole country, and that the Federal government ought to render
immediate and efficient aid in its construction, and, as an auxiliary
thereto, the immediate construction of an emigrant route on the line
of the railroad.
Resolved, That appropriations of Congress for the improvement of
rivers and harbors of a national character, required for the
accommodation and security of our existing commerce, are
authorized by the constitution, and justified by the obligation of
government to protect the lives and property of its citizens.
Resolved, That we invite the affiliation and co-operation of the
men of all parties, however differing from us in other respects, in
support of the principles herein declared; and believing that the
spirit of our institutions, as well as the constitution of our country,
guarantees liberty of conscience and equality of rights among
citizens, we oppose all proscriptive legislation affecting their security.

1856.—Whig Platform.

Baltimore, September 13.

Resolved, That the Whigs of the United States, now here
assembled, hereby declare their reverence for the constitution of the
United States, their unalterable attachment to the National Union,
and a fixed determination to do all in their power to preserve them
for themselves and their posterity. They have no new principles to
announce; no new platform to establish; but are content to broadly
rest—where their fathers rested—upon the constitution of the United
States, wishing no safer guide, no higher law.
Resolved, That we regard with the deepest interest and anxiety the
present disordered condition of our national affairs—a portion of the
country ravaged by civil war, large sections of our population
embittered by mutual recriminations; and we distinctly trace these
calamities to the culpable neglect of duty by the present national
administration.
Resolved, That the government of the United States was formed by
the conjunction in political unity of widespread geographical
sections, materially differing, not only in climate and products, but in
social and domestic institutions; and that any cause that shall
permanently array the different sections of the Union in political
hostility and organize parties founded only on geographical
distinctions, must inevitably prove fatal to a continuance of the
National Union.
Resolved, That the Whigs of the United States declare, as a
fundamental article of political faith, an absolute necessity for
avoiding geographical parties. The danger, so clearly discerned by
the Father of his Country, has now become fearfully apparent in the
agitation now convulsing the nation, and must be arrested at once if
we would preserve our constitution and our Union from
dismemberment, and the name of America from being blotted out
from the family of civilized nations.
Resolved, That all who revere the constitution and the Union,
must look with alarm at the parties in the field in the present
presidential campaign—one claiming only to represent sixteen
northern states, and the other appealing mainly to the passions and
prejudices of the southern states; that the success of either faction
must add fuel to the flame which now threatens to wrap our dearest
interests in a common ruin.
Resolved, That the only remedy for an evil so appalling is to
support a candidate pledged to neither of the geographical sections
nor arrayed in political antagonism, but holding both in a just and
equal regard. We congratulate the friends of the Union that such a
candidate exists in Millard Fillmore.
Resolved, That, without adopting or referring to the peculiar
doctrines of the party which has already selected Mr. Fillmore as a
candidate, we look to him as a well tried and faithful friend of the
constitution and the Union, eminent alike for his wisdom and
firmness—for his justice and moderation in our foreign relations—
calm and pacific temperament, so well becoming the head of a great
nation—for his devotion to the constitution in its true spirit—his
inflexibility in executing the laws but, beyond all these attributes, in
possessing the one transcendent merit of being a representative of
neither of the two sectional parties now struggling for political
supremacy.
Resolved, That, in the present exigency of political affairs, we are
not called upon to discuss the subordinate questions of
administration in the exercising of the constitutional powers of the
government. It is enough to know that civil war is raging, and that
the Union is in peril; and we proclaim the conviction that the
restoration of Mr. Fillmore to the presidency will furnish the best if
not the only means of restoring peace.

1860.—Constitutional Union Platform.

Baltimore, May 9.
Whereas, Experience has demonstrated that platforms adopted by
the partisan conventions of the country have had the effect to
mislead and deceive the people, and at the same time to widen the
political divisions of the country, by the creation and encouragement
of geographical and sectional parties; therefore,
Resolved, That it is both the part of patriotism and of duty to
recognize no political principles other than The Constitution of
the Country, the Union of the States, and the Enforcement of
the Laws; and that as representatives of the Constitutional Union
men of the country, in national convention assembled, we hereby
pledge ourselves to maintain, protect, and defend, separately and
unitedly, these great principles of public liberty and national safety
against all enemies at home and abroad, believing that thereby peace
may once more be restored to the country, the rights of the people
and of the states re-established, and the government again placed in
that condition of justice, fraternity, and equality, which, under the
example and constitution of our fathers, has solemnly bound every
citizen of the United States to maintain a more perfect union,
establish justice, insure domestic tranquillity, provide for the
common defense, promote the general welfare, and secure the
blessings of liberty to ourselves and our posterity.
 1860.—Republican Platform,

Chicago, May 17.

Resolved, That we, the delegated representatives of the Republican
electors of the United States, in convention assembled, in discharge
of the duty we owe to our constituents and our country, unite in the
following declarations:
1. That the history of the nation, during the last four years, has
fully established the propriety and necessity of the organization and
perpetuation of the Republican party, and that the causes which
called it into existence are permanent in their nature, and now, more
than ever before, demand its peaceful and constitutional triumph.
2. That the maintenance of the principles promulgated in the
Declaration of Independence and embodied in the federal
constitution, “That all men are created equal; that they are endowed
by their Creator with certain inalienable rights; that among these are
life, liberty, and the pursuit of happiness; that to secure these rights,
governments are instituted among men, deriving their just powers
from the consent of the governed,” is essential to the preservation of
our republican institutions; and that the federal constitution, the
rights of the states, and the union of the states, must and shall be
preserved.
3. That to the union of the states this nation owes its
unprecedented increase in population, its surprising development of
material resources, its rapid augmentation of wealth, its happiness at
home and its honor abroad; and we hold in abhorrence all schemes
for disunion, come from whatever source they may; and we
congratulate the country that no Republican member of Congress
has uttered or countenanced the threats of disunion so often made by
Democratic members, without rebuke and with applause from their
political associates; and we denounce those threats of disunion, in
case of a popular overthrow of their ascendency, as denying the vital
principles of a free government, and as an avowal of contemplated
treason, which it is the imperative duty of an indignant people
sternly to rebuke and forever silence.
4. That the maintenance inviolate of the rights of the states, and
especially the right of each state to order and control its own
domestic institutions according to its own judgment exclusively, is
essential to that balance of powers on which the perfection and
endurance of our political fabric depends; and we denounce the
lawless invasion, by armed force, of the soil of any state or territory,
no matter under what pretext, as among the gravest of crimes.
5. That the present Democratic administration has far exceeded
our worst apprehensions, in its measureless subserviency to the
exactions of a sectional interest, as especially evinced in its desperate
exertions to force the infamous Lecompton constitution upon the
protesting people of Kansas; in construing the personal relations
between master and servant to involve an unqualified property in
persons; in its attempted enforcement, everywhere, on land and sea,
through the intervention of Congress and of the federal courts, of the
extreme pretensions of a purely local interest; and in its general and
unvarying abuse of the power entrusted to it by a confiding people.
6. That the people justly view with alarm the reckless extravagance
which pervades every department of the Federal government; that a
return to rigid economy and accountability is indispensable to arrest
the systematic plunder of the public treasury by favored partisans;
while the recent startling developments of frauds and corruptions at
the federal metropolis, show that an entire change of administration
is imperatively demanded.
7. That the new dogma, that the constitution, of its own force,
carries slavery into any or all of the territories of the United States, is
a dangerous political heresy, at variance with the explicit provisions
of that instrument itself, with contemporaneous exposition, and with
legislative and judicial precedent—is revolutionary in its tendency,
and subversive of the peace and harmony of the country.
8. That the normal condition of all the territory of the United
States is that of freedom; that as our republican fathers, when they
had abolished slavery in all our national territory, ordained that “no
person shall be deprived of life, liberty, or property, without due
process of law,” it becomes our duty, by legislation, whenever such
legislation is necessary, to maintain this provision of the constitution
against all attempts to violate it; and we deny the authority of
Congress, of a territorial legislature, or of any individuals, to give
legal existence to slavery in any territory of the United States.
 9. That we brand the recent reopening of the African slave trade,
under the cover of our national flag, aided by perversions of judicial
power, as a crime against humanity and a burning shame to our
country and age; and we call upon Congress to take prompt and
efficient measures for the total and final suppression of that
execrable traffic.
10. That in the recent vetoes, by their federal governors, of the acts
of the legislatures of Kansas and Nebraska, prohibiting slavery in
those territories, we find a practical illustration of the boasted
Democratic principle of non-intervention and popular sovereignty,
embodied in the Kansas-Nebraska bill, and a demonstration of the
deception and fraud involved therein.
11. That Kansas should, of right, be immediately admitted as a
state under the constitution recently formed and adopted by her
people, and accepted by the House of Representatives.
12. That, while providing revenue for the support of the general
government by duties upon imports, sound policy requires such an
adjustment of these imports as to encourage the development of the
industrial interest of the whole country; and we commend that policy
of national exchanges which secures to the working men liberal
wages, to agriculture remunerative prices, to mechanics and
manufacturers an adequate reward for their skill, labor, and
enterprise, and to the nation commercial prosperity and
independence.
13. That we protest against any sale or alienation to others of the
public lands held by actual settlers, and against any view of the
homestead policy which regards the settlers as paupers or suppliants
for public bounty; and we demand the passage by Congress of the
complete and satisfactory homestead measure which has already
passed the House.
14. That the republican party is opposed to any change in our
naturalization laws, or any state legislation by which the rights of
citizenship hitherto accorded to immigrants from foreign lands shall
be abridged or impaired; and in favor of giving a full and efficient
protection to the rights of all classes of citizens, whether native or
naturalized, both at home and abroad.