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Section #8 - Efforts to end federal debt, close the U.S. Bank and restore hard currency lead to recession

Chapter 66: Jackson Ends The Nullification Threat From  South Carolina

November 18-24, 1832

The South Carolina Legislature Declares The Federal Tariffs Null And Void

As the election of 1832 is playing out nationally, political leaders in South Carolina are beating the drums on behalf of nullifying the 1828 “Tariff of Abominations.” One man in particular – 28 year old Congressman Robert Barnwell Rhett – calls the tariff a challenge to Southern “honor, imposed by “insatiable oppressors” in the North, and demanding a courageous response.

Robert Rhett
 Robert Rhett (1800-1876)

But if you are doubtful of yourselves – if you are not prepared to follow up your principles wherever they may lead, to their very last consequence – if you love life better than honor, — prefer ease to perilous liberty and glory; awake not! Stir not! — Impotent resistance will add vengeance to your ruin. Live in smiling peace with your insatiable Oppressors, and die with the noble consolation that your submissive patience will survive triumphant your beggary and despair

In turn, South Carolina decides to hold a special convention, running from November 19-24, 1832, to address the effects of the “1828 Tariff of Abominations” on the cotton industry.

The facts show that the tariff rate indeed jumps from 22.3% in 1825 to 35.0% by 1830.  

U.S. Tariff Rates 
Years 182018251830
Rate 20.2%22.3%35.0%
% Change +10% +57%

The increases have little obvious effect on the South’s production of cotton, which reaches an  all-time high of 306.8 million pounds in 1830, a five-fold increase over 1805. 

Cotton Production 
Years 182018251830
Lbs. (MM) 141.5 228.7 306.8
% Change +62% +34%

But they do depress the prices the South is able to charge for their output.

Cotton Prices Realized 
Years 182018251830
Cents/lb. 16.58 14.36 9.68
% Change (13%) (33%)

And they do bring growth in the total value of the cotton crop to a halt as of 1830.  

Value Of The Cotton Crop (Millions) 
Years 182018251830
Value $235$309$297
% Change +31% (4%)

As of 1830 then, the value of the cotton crop – at $297 million – is a little over half that of the  value placed on the South’s slave population.  

Value Of Enslaved People ($ Millions) 
Year # Enslaved (000)Auction Price Per PersonTotal ”Value” Of South’s Slaves$
1805 1032 $222$229
1810 1191 277330
1815 1354 272368
1820 1538 393604
1825 1758 277487
1830 2009 273548

The convention is dominated by what will become known as the “fire-eaters” and it passes a bill  stating that the state will no longer comply with the federal tariff, as of February 1, 1833. 

We, therefore, the people of the State of South Carolina, in convention assembled, do  declare and ordain … that the several acts and parts of acts of the Congress of the United States, purporting to be laws for the imposing of duties and imposts on the importation of foreign commodities… especially, an act…approved on the nineteenth day of May, one thousand eight hundred and twenty-eight and also an act…approved on the fourteenth day of July, one thousand eight hundred and thirty-two, are unauthorized by the constitution of the United States, and violate the true meaning and intent thereof and…shall be held utterly null and void.

The convention is dominated by what will become known as the “fire-eaters” and it passes a bill stating that the state will no longer comply with the federal tariff, as of February 1, 1833. 

We, therefore, the people of the State of South Carolina, in convention assembled, do declare and ordain … that the several acts and parts of acts of the Congress of the United States, purporting to be laws for the imposing of duties and imposts on the  importation of foreign commodities… especially, an act…approved on the nineteenth day  of May, one thousand eight hundred and twenty-eight and also an act…approved on the  fourteenth day of July, one thousand eight hundred and thirty-two, are unauthorized by  the constitution of the United States, and violate the true meaning and intent thereof and…shall be held utterly null and void.

December 13, 1832

Governor Robert Hayne Raises The Nullification Stakes In His Inaugural Address

Since his much-publicized senate debate in January 1830 with Daniel Webster on the “value of the Union,” Robert Hayne is elected Governor of South Carolina in 1832. 

His inaugural address takes place on December 13, with the state legislature’s “nullification bill.” just three weeks old. He decides to use the occasion to justify the action to Washington and  to try to rally other Southern states to join the cause.  

His begins with the same broad argument in his senate speech – that the constitution guarantees the right of sovereign states to protect their well-being against federal actions that cause them harm.  

In the great struggle in which we engaged, for the preservation of our rights and liberties, it is my fixed determination to assert and uphold the SOVEREIGN AUTHORITY OF THE STATE, and to enforce by all the means that may be entrusted to my hands, her SOVEREIGN WILL.

After ten years of unavailing petitions and remonstrances… against a system of measures on the part of the Federal Government fatal to the prosperity of her people…(South  Carolina) has made the solemn declaration that this system shall no longer be enforced  within her limits.

He challenges “sister States” in the South to decide whether they will stand with South Carolina.

…it is for her sister States, now, to determine, what is to be done in this emergency.

His words then grow more ominous. South Carolina wants peace with the other states, not separation from them. But that will be possible only if limits are placed on the power of the central government. 

South Carolina is anxiously desirous of living at peace with her brethren; she has not the remotest wish to dissolve the political bonds which have connected her with the great American family of Confederated States. With Thomas Jefferson, “she would regard the  dissolution of our Union with them, as one of the greatest of evils–but not the greatest,– there is one greater: SUBMISSION TO A GOVERNMENT WITHOUT LIMITATION OF  POWERS;” 

A confederacy of sovereign states, formed by the free consent of all, cannot possibly be held together, by any other tie than mutual sympathies and common interest.

If need be, Hayne declares that the state will defend its sovereign rights by force of arms.

The spirit of our free institutions, the very temper of the age, would seem to forbid the thought of an appeal to force, for the settlement of a constitutional controversy. If, however, we should be prepared to meet danger, and repel invasion, come from what quarter it may…. 

If that fails, the entire South will pay the price along with South Carolina. 

If after making those efforts due to her own honor and the greatness of the cause, she is destined utterly to fail, the bitter fruits of that failure, [will fall] not to herself alone, but to the entire South.

To back up his rhetoric, Hayne will go on to assemble a state infantry unit comprising some 25,000 men, who will stand at the ready in case of a military response from Washington. This is now a matter of honor, and Hayne is certain that every man will do his duty if called upon. 

If the sacred soil of Carolina should be polluted by the footsteps of an invader, or be stained with the blood of her citizens, shed in defense, I trust in Almighty God that… there will not be found, in the wider limits of the state, one recreant son who will not fly  to the rescue, and be ready to lay down his life in her defense. 

January 16 – March 2, 1833

Andrew Jackson Responds With His “Force Bill”

In the presence of a threat, especially in the realm of “honor,” Andrew Jackson hardly pauses before picking up the challenge from South Carolina. 

He may be a fellow plantation owner and slave holder, but first and foremost he is President of the United States, sworn to preserve, protect and defend the Union. 

And he does not mince his words in response to the South Carolina threats.  

If a single drop of blood shall be shed there in opposition to the laws of the United States, I will hang the first man I can lay my hands on engaged in such treasonable conduct on  the first tree I can find. 

To demonstrate his resolve, he sends a message to Congress on January 16, 1833, urging it to pass a bill to slap down any attempts by South Carolina to ignore federal law. 

The legislation becomes known as the “Force Bill” for language authorizing Jackson to send US troops into any state that fails to collect the proper tariff on inbound cargo.

In addition, Jackson warns Governor John Floyd of Virginia – who headed the “Nullifier” ticket in 1932 – that he will be arrested should he try to impede federal troops marching through his state to South Carolina.  

The “Force Bill” becomes law on March 2, 1833, some 28 years before the guns sound at Ft. Sumter.

March 2, 1833

The Compromise Tariff Of 1833 Ends The “Nullification Crisis”

On the same day that Jackson signs the “Force Bill” he also signs the “Compromise Tariff of 1833” that resolves the nullification crisis for the moment. 

As usual, it is Henry Clay, now in the Senate, who steps forward to craft a solution to the brinksmanship going on between South Carolina and the President.  

Clay’s position in the controversy is a delicate one.  

On one hand he wants a sizable tariff to fund his economic development plan for the country — which he calls the “American System.” On the other, he learns that Jackson is willing to cut the tariff substantially as long as he doesn’t appear to be caving in to a secession threat.  

So, how to find a compromise that maintains reasonably high funding for his plan while resolving the threat of secession and a military response? 

Clay’s solution is the Compromise Tariff of 1833, in which South Carolina backs off from its nullification threat in exchange for a gradual reduction in the tariff to 20%, phased over a ten year period.  

This compromise passes in the House by a 149-47 margin, is signed by Jackson, and ends the immediate crisis. 

But the entire episode remains deeply troubling to those intent on maintaining the Union. It signals profound division and animosity between the South and the North.  

For astute politicians, it also portends a much more threatening crisis to come – not over taxation, but over slavery.  

Jackson’s instincts in this regard are prescient. Nullification of the tariff was only the pretext for the South’s real issue — the “negro question” and secession.

The tariff was only the pretext, and disunion and southern confederacy the real object. The next pretext will be the negro or slavery question.

Both regions are now digging in once more, much as they did in 1820 around the Missouri statehood crisis. 

The South, feeling economically threatened by a federal government no longer in the hands of its  Virginia planters, begins to openly discuss breaking with the union. 

The North, wanting nothing to do with the “negro question,” begins to assert its growing majority in Congress to bring “the Slave Power” to heel.  

In hindsight, the Nullification Crisis of 1832-3 will prove to be one more dress rehearsal for the Secession Crisis of 1860-61. 

Sidebar: History And Importance Of Tariffs In The U.S.

Tariff Rates and Net Government Revenue Generated
YearTariff RateRevenue ($MM)Total U.S. Spending% From Tariff
180010.0%$10.8$10.883.7%
180510.7%$13.6$13.695.4%
181010.1%$9.4$9.491.5%
18156.5%$15.7$15.746.4%
182020.2%$17.9$17.983.9%
182522.3%$20.5$20.597.9%
183035.0%$24.8$24.888.2%
183514.2%$35.8$35.854.1%
184012.7%$19.5$19.564.2%
184524.3%$30.0$30.091.9%
185022.9%$43.6$43.691.0%
185520.6%$65.4$65.481.2%
186015.0%$56.1$56.194.9%