Daniel Webster
And the War on the Second Bank of the United States
By Paul J. Rastatter
Daniel Webster is today remembered as one of a handful of men who was a leading
statesman, lawyer and politician in our early republic. Mr. Webster was
first elected into the U.S. House of Representatives from New Hampshire
as a Federalist candidate in opposition to the War of 1812. He resigned
his seat in Congress four years later in order to build up a lucrative
law practice in Boston and in Washington. Webster argued many cases before
the Supreme Court including Dartmouth College v. Woodward, McCullough
v. Maryland and Gibbons v. Ogden. In Boston, his patrons and associates
coerced Webster back into public service in 1823. Webster is well known
for his oratorical skills and thousands of schoolchildren from New England
were required to memorize verbatim one or more of his famous speeches.
In the early 1830's, Webster became embroiled in the controversy
surrounding the War on the Second Bank of the United States. Throughout
his long career, Daniel Webster was in sympathy with the banking industry
...
Webster's Early Years
Daniel Webster was born and raised in the turbulent yet patriotic days
of our nation's founding. His father, Ebenezer Webster, was a Captain
of a New Hampshire militia unit and fought at Dorchester Heights (Bunker
Hill) and Bennington, Vermont.[1] As a young boy, Daniel possessed a physical
weakness that inclined him to studies and long walks in the countryside.
Work on the father's farm was mainly done by Daniel's older
brother, Ezekiel. A few years after the Revolutionary War, Daniel's
father, Ebenezer, secured a position as a Lay Justice or Judge for the
Court of Common Pleas.[2] It was this money ($300 a year) that was used
to start Daniel's education.
Daniel attended school in Salisbury under a schoolmaster as a young lad.
He was not a prodigy but was known for his quick wit and verbal ability.
In his early teens, Daniel was enrolled in the Exeter Academy for boys
to prepare him for the college entrance exams. In 1797, at the age of
sixteen, Daniel Webster was admitted to Dartmouth College. He spent four
years at Dartmouth and excelled in most subjects but had some trouble
with Latin and Greek. He returned to Salisbury to study law. Daniel interrupted
his law studies to teach school for a year in Fryeburg, Maine, so that
his older brother, Ezekiel, could also attend Dartmouth. Daniel passed
the Bar exam and was admitted to practice law in Suffolk County, New Hampshire
in 1805.[3]
Daniel had a close relationship with his father and corresponded with
him regularly. Many of the letters have been saved in The Papers of Daniel
Webster: Correspondence – 3 Volumes. The following is a memorable
quote from Daniel's father, Ebenezer:
Daniel, in the long struggle with poverty and adverse fortune that your
mother and I have made to give you and Ezekiel an education, we have often
talked over these sacrifices, and the prospects of our children. Your
mother has often said to me that she had no fear about Ezekiel; that he
had fixed and steady habits, and an indomitable energy... But as for
you she did not know. Either you would be something or nothing; she did
not know which. I think... you have fulfilled her prophecy. You have
come to nothing." [4]
In May 1806, Daniel Webster defended Josiah Burnham who was charged
with killing two of his companions in a Haverhill jail, by stabbing them
with the broken end of a scythe. Webster's plea against capital
punishment fell on deaf ears and Josiah Burnham was hanged on August 12,
1806. [5] In May 1807, a date that corresponds with the graduation of
Ezekiel from Dartmouth, Daniel Webster moved his law practice to Portsmouth,
New Hampshire. In the following year, Daniel married Grace Fletcher, a
former schoolteacher from Salisbury. For nine years, Daniel and Grace
lived in Portsmouth as Daniel became proficient in law, while two children
were born to the happy couple.
In political areas, Webster was a conservative and a Federalist. Webster's
New England was deeply affected by Thomas Jefferson's embargo. In
the election of 1808, New Hampshire, Massachusetts and Rhode Island voted
against Jefferson's handpicked successor, James Madison. Webster,
as a staunch Federalist, opposed the war of 1812. Webster gave one of
his early speeches at a town gathering on the Fourth of July 1812. Two
months later on August fifth, Webster wrote and delivered the "Rockingham
Memorial" [6] that was published in the local newspapers and was
sent to President James Madison. In November, 1812, the delegation to
the US House of Representatives in New Hampshire increased from five members
to six and Daniel Webster's name was put forward in a general election
for this new slot. At the age of thirty-one, Daniel Webster was elected
to represent New Hampshire as a Federalist in opposition to the war.
In December 1813, Daniel Webster was en-route to Washington D.C. when
disaster struck his hometown of Portsmouth. At seven-thirty at night,
a fire broke out in a neighbor's barn and quickly spread to the
town. Webster's uninsured house worth $6000 and his law library
were consumed in the raging fire. "When the conflagration was checked,
at about five o'clock on the following morning, fifteen acres lay
in smoldering ruins, 272 buildings had been destroyed, including 108 dwelling
houses and 64 stores and shops with a total loss of more than $300,000."[7]
Webster's shaky finances were wrecked with the fire. Shortly after
the disaster, Daniel wrote, "...the safety of my family compensates
(for) the loss of property." [8] One biographer wrote of Webster's
constant money problems, "Of the frugality so often ascribed to
the New England Yankee, neither Daniel Webster nor his father had the
slightest trace. He went through Dartmouth on borrowed funds: he assumed
his father's obligations, and paid them off; and when cash came
in easily, it was spent as if the source were inexhaustible." [9]
A contemporary of Webster, Judge Jeremiah Smith wrote, "He does
not know the value of money, and never will. No matter; he was born for
something better than hoarding money-bags."[10]
Congressman
During his first session as a Congressman, Webster embarrassed the Madison
administration by requesting information pertaining to the revocation
of the Berlin and Milan Decrees. The implication was that Madison had
secretly hidden the diplomatic papers, which would have affected the voting
on the declaration of War against Great Britain. Shortly thereafter, Speaker
of the House, Henry Clay, removed Daniel Webster from his seat on the
Committee of Foreign Relations. As a member of the opposition party, Webster
approved of expenditures that increased our defenses but voted against
what he called, "futile projects of invasion."[11]
In the winter session of 1814, Daniel Webster headed the opposition
against the formation of a national, government-run bank. After the bill
was defeated, John C. Calhoun came to Daniel Webster and pleaded for his
help in framing a new act that would pass the Congress. Webster agreed
and a new bill was drafted but President Madison vetoed the bill as unconstitutional.
A year later a third 'bank bill' was drafted with a larger
capitalization of $35 million. Webster was opposed to this bill because
of the subscription of stock by the government and the appointment of
government directors but the bill passed and this time, it was signed
by Madison's successor, President Monroe and became law.[12]
One of Webster's last votes in the House of Representatives was
in favor of increasing the pay of Congressmen from six dollars a day plus
mileage to $1500 a year. There was a great outcry from the public over
this act of Congress and many members lost their seat, but by the next
session, Daniel Webster had decided to move his family and law practice
to Boston, Massachusetts and was thereby ineligible to run. Before he
left Congress, Daniel Webster was challenged to a duel by John Randolph
of Virginia but Daniel refused to meet him to account for "words
of a general nature used in debate."[13]
As a Congressman and an attorney, Webster was admitted to practice law
before the Supreme Court of the United States. In 1814, Webster was employed
in two cases involving prizes of war. A year later in an appeal case from
Vermont, Webster took a liberal interpretation of the Constitution and
argued successfully against citizens of one state claiming land under
grants from another state. The modest successes that Webster enjoyed in
these cases no doubt stirred his ambition to build up a larger law practice.
He would need to move to a larger city than Portsmouth, New Hampshire.
The Constitutional Lawyer
In August 1816, Webster moved his family and law practice to Boston.
It was not long before Webster was placed among the best attorneys in
the country. "That Mr. Webster was the foremost American lawyer
of his time," declared Senator George F Hoar, "as well in
the capacity to conduct jury trials as to argue questions of the law before
the full court, will not, I think, be seriously questioned by anyone who
has read the reports of his legal arguments or has studied the history
of his encounters before juries with antagonists like Choate or Pinkney."[14]
In one famous criminal case of its day, Daniel Webster defended two brothers
accused of shooting a man and stealing his wagon full of supplies. Webster's
cross-examination of the man who was shot revealed inconsistencies in
his earlier testimony, thus, proving to the jury that the injured man
actually shot himself accidentally while faking the robbery to "avoid
his obligations or perhaps also for a passion for notoriety."[15]
In 1818, Daniel Webster argued the most famous case of his career before
the United States Supreme Court. In Dartmouth College v. Woodward, the
New Hampshire State Legislature tried to circumvent the original colonial
charter that established Dartmouth College back in 1769. In his closing
remarks before the Court, Daniel Webster said, "Sir, you may destroy
this little institution; it is weak; it is in your hands! You may put
it out; but if you do, you must carry on your work! You must extinguish
one after another, all those great lights of science, which, for more
than a century, have thrown their radiance over the land... It is,
sir, as I have said a small college, --and yet there are those who love
it..."[16]. Webster was able to guide the court through the
difficult political, religious and economic issues and to prove to Chief
Justice John Marshall et al, that Connecticut had violated that section
of the U.S. Constitution that states, "no State... shall pass
any bill of attainer, ex post facto law, or law impairing the obligation
of contracts."[17] In referring to the Dartmouth case, Henry Cabot
Lodge wrote "It has been cited over a thousand times in subsequent
litigation and has extended the jurisdiction of the highest federal court
more than any other judgement rendered by them." [18]
Only three weeks after the decision was handed down in the Dartmouth
case, Daniel Webster was back in the Supreme Court as junior counsel in
another famous case, McCullough v. Maryland. The issues surrounding this
case have some significance in examining Webster's motives ten years
later in defending the Bank against Andrew Jackson's onslaught.
When the Second Bank of the United States had been chartered in 1816,
a branch was opened in Baltimore, Maryland. One of the special features
of the Bank of the United Sates (B.U.S.) was the ability to demand payment
in specie (hard currency) for bank notes derived from lesser State banks.
This advantage by the B.U.S. caused resentment and in general, a curtailment
of credit because the lesser banks had to keep specie on hand in case
the B.U.S. decided to cash in its notes. (Similar to what the Federal
Reserve does today.) The State banks in Maryland induced the Maryland
Legislature to pass an act taxing all banks not chartered by the State
thereby driving the B.U.S. out of State. A lawsuit worked its way up through
the Maryland Appeals Court and was now in the hands of Daniel Webster
and Co-counsel William Pinkney.
The argument in McCullough v. Maryland covered nine full days. The questions
before the Court were: 1) Does Congress have the right to charter a 'National
Bank'? and 2) Can a State Legislature tax an institution created
by Congress? Daniel Webster spoke for most of the first day of testimony
and reminded the Court that, "an unlimited power to tax involves,
necessarily, the power to destroy."[19] After the trial, Chief Justice
John Marshall took only three days to hand down one of his longest opinions
ever written. Marshall had probably written a preliminary draft of his
opinion before the trial in early winter.[20] Marshall in essence wrote
that yes, Congress does have the right to charter a bank and no, an individual
State does not have the power to tax and thus 'destroy' an
institution created by Congress.
In 1824, Daniel Webster tried his third landmark Supreme Court case;
Gibbons v. Ogden or more commonly called the 'Steamboat case'.
The suit was brought about by Thomas Gibbons who started a steamboat line
from Elizabethtown, New Jersey into New York City. Gibbons was opposed
by powerful interests in New York. Robert Fulton, Robert Livingston and
Aaron Ogden shared the monopoly of steamboat traffic in New York waters.
Ogden had purchased the right to operate from New Jersey but Gibbons refused
to do so. The question before the Court was: Did New York laws granting
a monopoly of steamboat traffic violate that section of the U.S. Constitution
that leaves to Congress the power 'to regulate commerce among the
several states?"[21]
Daniel Webster spoke for two and one-half hours on behalf of his client,
Thomas Gibbons. Some report that his eloquence and his force of argument
were never better. After a short postponement, Justice Marshall returned
with the opinion that " the acts of New York must yield to the laws
of Congress."[22]
The Great Orator
In 1820, on the 200th anniversary of the arrival of the Mayflower, Daniel
Webster was asked to be the chief speaker for a day of ceremonies to be
held in Plymouth, forty miles southeast of Boston. His passion for speaking,
his skills as an orator and his profound convictions were long remembered
by New Englanders. "Beginning simply, he touched briefly on the
momentous nature of the anniversary, analyzed the motives which drove
the Pilgrims to our shores, described the history and character of the
early settlements, dwelt at some length on the government and society
of our country, ...emphasized the importance of free schools, denounced
the African slave trade, called attention to the religious character of
our origin and concluded with a greeting to future generations."[23]
Webster must have deemed this oration as one of his very best because
he placed it first in a later published book on all of his important speeches.
In 1825, Webster was again invited to speak at the fiftieth anniversary
of the battle of Bunker Hill. The Marquis de Lafayette would attend, as
would fifty or more veterans from the Revolution. While his audience in
Plymouth was only about fifteen hundred, his 'Bunker Hill'
speech drew a crowd of over twenty thousand. It is primarily this speech
that generations of New Englanders memorized and recited verbatim:
We come as Americans to mark a spot, which must forever be dear to us
and our posterity. We wish that whosoever, in all coming time, shall turn
his eye hither, may behold that the place is not undistinguished where
the first great battle of the Revolution was fought....[24]
One year later, Mr. Webster was once more on the podium eulogizing the
deaths of two great Presidents: John Adams and Thomas Jefferson who both
died on the same day, July 4th, 1826, exactly fifty years after the signing
of the Declaration of Independence.
1 Fuess, Daniel Webster, 7-11. Ebenezer Webster's Revolutionary
War Record. There is an anecdote of a supposed quote from Gen. Washington
after a brief mutiny of New Jersey and Pennsylvania troops and how glad
the General was to have Captain Webster's men guarding him!
2 McMaster, Daniel Webster, 11. "$300 a year as Lay Justice of the
Court of Common Pleas."
3 Fuess, D.W., 84. Admitted to the Bar in Suffolk County in 1805.
4 The Correspondence of Daniel Webster Vol. 1, 37. Father's quote:
"You have come to nothing."
5 Fuess, D.W., 89. Josiah Burnham hanged on August 12, 1806.
6 Fuess, D.W., 95. Rockingham Memorial sent to Pres. Madison in opposition
to the War.
7 McMaster, D.W., 89. Quote about the fire in Portsmouth.
8 Correspondence of Daniel Webster Vol. 1, 145. Quote from D.W. "the
safety of my family compensates (for) the loss of property.
9 Fuess, D.W., 118. Quote from Fuess on frugality of Yankees.
10 Lewis, Speak for Yourself, Daniel, 37. Quote from Judge and later Governor
Smith on "he was born for more than hoarding money bags."
11 Fuess, D.W., 162. D.W.- "futile projects of invasion."
12 Current, D.W. and the Rise of National Conservatism, 18. Third 'bank'
bill signed by Monroe.
13 Fuess, D. W., 189. Quote for why Webster turned down Randolph duel.
14 Baxter, One and Inseparable- D.W and the Union., 128. Quote from Sen.
Hoar on Webster as the best lawyer in the country.
15 Fuess, D.W., 212. Facts relating to the case of the two brothers accused
of hijacking.
16 Fuess, D.W., 231. Dartmouth College Quote "there are those who
love it"
17 Fuess, D.W., 224. U.S. Constitution- "...expost facto law,
or law impairing the obligation of contracts."
18 Henry Cabot Lodge, Daniel Webster, 96. Dartmouth College Case...'cited
over a thousand times in subsequent legislation."
19 Fuess, Daniel Webster, 250. "the power to destroy" quote
20 Beveridge, Marshall, IV, 290. Marshall wrote a draft of opinion before
trial!
21 U.S. Constitution... "to regulate commerce among the several
states."
22 Beveridge, Marshall, IV, 429. Gibbons v Ogden - "the acts of
New York must yield to Congress"
23 Fuess, D.W., 289-290. Summary of the Plymouth oration.
24 Benson, Daniel Webster, 159. Quote from the 'Bunker Hill'
speech.
25 Wiltse, ed., The Papers of Daniel Webster-Correspondence Vol. 2, 83,
144, 157. Letters to and from Biddle.
26 Current, Daniel Webster and the Rise of National Conservatism, 76.
Biddle refused loan to National Intelligencer.
27 Wilburn, Jean Alexander, Biddle's Bank, 5. Reasons why Biddle
chose 1832 vote.
28 Current, D.W., 77. Massachusetts banks in good shape.
29 Watson, Liberty and Power, 143. Quote from Jackson 'The bank
is trying to kill me...'
30 Remini, Andrew Jackson and the Bank War, 158. Quote on Jackson's
veto message.
31 Wilburn, Biddle's Bank,7. Van Buren's loss of the Court
of St. James
32 Hammond, Banks and Politics, 369. Early Jacksonian policy — 'spoils
of victory'.
33 Hammond, Banks and Politics in America, 371. Letter to Sen. Felix Grundy — "a
wholly new 'national' bank.
34 Hammond, Banks and Politics, 374. Not true-1826 to 1832 'high
water mark for a sound currency'.
35 Current, D.W. and the Rise of National Conservatism, 77. Quote from
Webster after the bank veto.
36 Current, D.W., 79. Quote from the Louisville Journal on Webster.
37 Current, D.W., 81. Letter to Biddle requesting retainer.
38 Watson, Liberty and Power, 158. Memorials demand restoration of Bank
deposits.
39 Watson, Liberty, 159. Origin of the party name 'Whigs".
40 Lodge, Daniel Webster, 208-209. Quote from Lodge on formation of Whigs.
41 Watson, Liberty, 159. 347 new State banks chartered.
42 Current, D.W., 86. New recharter bill for B.U.S.
