Mathew Carey and the Rise of the 'American System'

Part 1 - The Olive Branch

While, in many history sources, Mathew Carey is described as a ‘Jeffersonian republican’, the question arises, how did a supporter of Jefferson – the opponent of ‘federalist’ Alexander Hamilton, become the father of the ‘American System’, the defender of Hamiltonian economics and the opponent of the British free-trade policies of Adam Smith?  In his own words, I will briefly try to show how this actually happened.

Matthew Carey

Mathew Carey arrived in Philadelphia in 1784, having to flee from Ireland to avoid arrest and imprisonment by the British Government. With $400 given to him by Gilbert Lafayette, he started a book store and publishing shop. He became a strong supporter of the adoption of the United States Constitution and a strong supporter of Alexander Hamilton and the ‘federalists’, until the fight over Jay’s treaty in 1795.

Carey felt the treaty was pro-British, and there probably wasn’t anyone on earth who disliked the British Empire more than he did. His opposition to Jay’s treaty changed his support from the ‘federalists’ to the ‘republicans’, although he still favoured Hamilton’s economic policies – as can be seen in 1810, when he become a leading voice in favour of the renewal of the charter for the Bank of the United States.

The following is from the Autobiography of Mathew Carey, that originally appeared in the New England Magazine, from Letter XIII:

“In the year 1810, the apple of discord was thrown among the citizens of the United States by the question of a renewal or non-renewal of the charter of the Bank of the United States, which was to expire on the third of the ensuing March; the discussion of which was carried on with great acrimony. I took a deep interest in the question, and withdrew myself from the care and attention to my business for three months, devoting myself with all my zeal and energy to the support of the renewal, anticipating, as I did, the disastrous consequences that were likely to result from the host of State Banks, for which the dissolution of that institution would afford a plea or pretext – the probable depreciation of their paper – and ultimately the suspension of specie payments. The great body of the democrats were opposed to the renewal; and of the party I stood alone in this city; was regarded by many as having abandoned them; and made myself hosts of enemies among my quondam friends.

I wrote a series of essays, in which I endeavored to disprove the reasons adduced in favor of the non-renewal, and to place in the strongest point of light the arguments on the opposite side of the question …

One morning towards the close of the session, as I lay on my bed, pondering on ‘the prospects before us’, I was suddenly struck with the idea, that, being regarded as an ultra-democrat, and being intimately acquainted with some of the most influential members of the Pennsylvania delegation, who would probably place some reliance on my judgement, as having been some years a Bank director*, and long engaged in extensive trade, I might be able to convince them of the danger of a non-renewal.”

* [For three years, 1802-1805, Carey was elected to be a director of the Bank of Pennsylvania]

“Without a moment’s delay I hurried out of bed; and having signed some checks and notes, and left directions for the management of my business, I was in less than an hour and a half in the stage on my way to Washington, without consulting an individual … Finding that in the course of the debates some most absurd assertions and assumptions were presented, I wrote and had printed a pamphlet, entitled ‘Desultory Reflections on the ruinous consequences of a non-renewal of the Charter of the Bank of the United States’ … But all arguments and facts on the subject were in vain. The Bill for a renewal was indefinitely postponed on the 24^th of January 1811, in the House of Representatives, and in the Senate rejected on the 20^th of February, by the casting vote of the Vice-President, George Clinton, on the ground of unconstitutionality …”

The defeat of the bill to re-charter the Bank (by one vote!) removed Carey as a devout member of the ‘republicans’, and it now freed him from all the strife of parties and factions – and that would turn out to be a true blessing.

The Olive Branch

During the War of 1812, many New Englanders opposed the war, opposed sending the state militias to fight against the British, were threatened with a bill for conscription, and called for a convention to discuss the possibility of seceding from the Union. 

In the middle of this crisis, Carey asked himself, could it be possible ‘that a man in private life, wholly without influence, unsupported by party or by family connexions, could calm the raging waves of faction which threatened shipwreck to the vessel of state?’

In 1814, while not looking to the interest of any political party, but only to the interest of the nation, Carey would write ‘The Olive Branch, or Faults on Both Sides, Federal and Democratic.  A Serious Appeal on the Necessity of Mutual Forgiveness and Harmony’.

The following is from the Autobiography of Mathew Carey, that originally appeared in the New England Magazine, from Letter XXIX:

“The publication of the Olive Branch was one of the most important incidents of my life … The lawless and outrageous depredations on our commerce, by the belligerents, most of which, under pretexts the most fallacious, violated every principle of honor, honesty, justice and international law, had divided the people of the United States into two hostile parties, by which, as is the case in times of faction in all countries, the solid interests of the nation were often in some degree lost sight of.

It was on the one side asserted that Mr. Jefferson, and the administration generally, were in the interests and in the pay of the French Government – and this was as firmly believed by the mass of the party whose leaders had promulgated the idea, as if it had been judicially proved. On the other side it was confidently asserted, and as implicitly believed, that the opposition was so blindly devoted to the interests of Great Britain, that they were ready to sacrifice those of their own country in her favour … I had watched for years the progress of this excitement in New England with the most intense anxiety. It foreboded, in my estimation, civil war and all its horrors.  That we were on the verge of it can scarcely at this moment be doubted by those who have a perfect recollection of the perturbed state of the public mind at that period …

In the month of September 1814, in a moment of ardent zeal and enthusiasm, I was seized with a desire of making an effort, by a candid publication of the numerous errors and follies on both sides, (to call them by no stronger names), to allay the public effervescence and calm the embittered feelings of the parties. The idea was truly Quixotic, which nothing but the excited state of my feelings could have suggested …

It was after the shameful defeat at Bladensburg, and the Vandalic conflagration at Washington. The stoutest hearts felt qualms, and were lost in suspense as to the fearful result of such an awful state of things. Those were really ‘times that tried men’s souls’ … But great as was my despondency, I felt dissatisfied with what I had written – tore the pages – and, for some days, relinquished the idea of pursuing the subject.

Meanwhile three events occurred, admirably calculated to raise the spirits of our citizens generally, viz; the victory of Commodore McDonough, the defeat of Prevost at Plattsburg, and that of Ross in his attempt on Baltimore. These exhilarating circumstances dispelled the gloom of the public mind; removed the despondence by which I had been borne down; and, on the 18^th of September, commenced anew, on a different plan …

The edition was sold out in a few weeks … I was preparing for a new edition, when the thrice-welcome news of peace arrived – which, I thought, would render a new edition unnecessary. I was much mistaken. The demand increased daily, and I need not say that I had every motive to induce me to supply it … in three years and a half it went through ten editions.  The whole number sold was above 10,000 copies, a greater sale probably than any book ever had in this country, except some religious ones.”

Soon, in February 1815, the Senate would ratify the Treaty of Peace and Amity between His Britannic Majesty and the United States, ending the war of 1812-1814. But, for an American economic recovery – to repair the collapsed currency, to build the needed roads and canals, and to protect the domestic industries from the ravages of British free-trade, the battle would now begin.

[next week - part 2 - The Fight for a National Bank]