Tambora: The Eruption That Changed the World (33 page)

Thanks to the blessed intercession of western agriculture, the famine Jefferson himself had feared for Virginia and the Atlantic states in 1817–18 never eventuated, despite the general misery and alarm. What Jefferson did not reckon upon, however—and never properly understood—was the full ripple effect of “Eighteen-Hundred-and-Froze-to-Death” through the transatlantic economy and the primary role it played in America’s first great depression of 1819–22.
³⁵
As a cash-poor plantation farmer, Jefferson himself stood at the frontline of that impending economic collapse. Despite the impression of Olympian serenity he presented to visitors, Jefferson experienced the Tambora-driven economic crisis of those post-1816 years in a sickening spiral of indebtedness that culminated in the great personal humiliation of his old age: the mortgaging of his beloved Monticello.

By the late summer of 1818, the directors of the national bank of the United States had grown increasingly fearful of a credit bubble spurred
by the extraordinary wave of migration and land speculation in the frontier West. A combination of 1816’s disastrous weather and the subsequent demand for western grain on both sides of the Atlantic had lured settlers across the Appalachians in the tens of thousands. “So terrible was the year 1816,” one New Hampshire diarist recorded, “that the people grew disheartened and many sold out and went west.”
³⁶

Land speculators advertised aggressively for new settlers, convincing many New England farmers to sell up on the spot. Entire communities traveled together in wagon trains, looking to establish new townships in Ohio or Indiana; the latter welcomed forty-two thousand new inhabitants in 1816 alone.
³⁷
“Old America seems to be breaking up and moving westward,” wrote the English promoter Morris Birkbeck in his best-selling Illinois travelogue of 1818. One witness in Missouri rated the hordes of migrants on a scale of natural disasters, as a “flood,” a “mountain torrent,” an “avalanche.” Jefferson himself called the migratory wave out of Virginia in 1816–18 “beyond anything imaginable.”
³⁸

The desperate poor were sometimes reduced to crossing the mountains on foot, including a family of eight who trudged from Maine to Easton, Pennsylvania, arriving in the dead of winter with their smallest child nearly frozen in a hand cart.
³⁹
But the call of Westward Ho! was heeded not only by impoverished refugees. According to influential travel writer Henry Fearon, who toured the length and breadth of the United States in 1817–18, the migrant wave also included “men of capital, of industry … who apprehended approaching evils” and were concerned “to provide for the future support and prosperity of their offspring.”
⁴⁰

Western politicians took advantage of the economic distress in the East following the poor harvests of 1816 and 1817 by painting the advantages of trans-Appalachian migration in the gaudiest Jeffersonian colors: “There neither is, nor, in the nature of things can there ever be, anything like poverty there. All is ease, tranquility, and comfort,” wrote one Missouri representative. Economic refugees from Europe’s disastrous 1816 joined the tide. Despite the efforts of the British Parliament to limit the number of passengers aboard U.S.-bound vessels, 1817 witnessed the greatest number of British and European migrants yet to
arrive on American soil in a single year. Official records were not kept in the days of the early republic, but even during the French Terror of the mid-1790s, annual migration from Europe to the United States never reached 10,000. In 1817, it spiked to 22,240.
⁴¹
To this must be added the British migrants who teemed south across the border from British Canada: 10,000 in 1817, swelling to 14,500 in 1818.
⁴²
Few, it seems, intended to settle in the established cities of the Northeast. “I can scarcely walk a square,” a Philadelphian reported, “without meeting with Irish, Dutch, English, and Scotch emigrants, whose destination is principally Ohio and Indiana.” All of which meant bad news for the American Indians, who continued to be forced west to make way for the new arrivals. As a consequence of the first major westward expansion in U.S. history, a flurry of “treaties” formalized the ejection of indigenous peoples from lands they had inhabited time out of mind.

At the height of America’s first real estate bubble, land prices out west replaced the weather as the “perpetual topic of conversation.”
⁴³
Makeshift banks sprung up overnight to handle the deluge of new settlers and their land claims. “The children of Israel could scarcely have presented a more motley array,” recalled pioneering geographer Henry Schoolcraft, who traveled with the legions of migrants along the rivers to the interior. Expectations were running high: “To judge by the tone of general conversation, they meant, in their generation, to plough the Mississippi Valley from its head to its foot…. What a world of golden dreams was there!”
⁴⁴
People called it “Ohio fever,” which one no sooner recovered from than “Missouri fever” or “Illinois fever” took hold. Before the fever finally broke with the Panic of 1819, five new states had been established: Illinois, Indiana, Kentucky, Alabama, and, controversially, Missouri in 1820.

The land rush of 1817–18 lacked one crucial ingredient, however: capital. No national currency was in place to fund the large-scale movement of population across state lines into “empty” territory. Moreover, the hard currency Americans depended on—mostly Spanish silver—was simultaneously flowing in the opposite direction toward Europe to pay for the glut of imported British manufactures following the end of the war and to retire national debt. People fled west as money fled east.
With specie scarce and no established financial institutions across the Appalachians, the frontier land drive ran on confidence alone, through the circulation of notes of credit backed by personal endorsements.

In his letters, Thomas Jefferson said little of his own financial woes but predicted disaster for the country. The new national bank, to which he had essentially mortgaged his property, had been created on April 10, 1816—the ill-omened first anniversary of Tambora’s eruption. Within a few short years, its haphazard policies would help trigger an implosion across the entire U.S. economy. To finance the land boom, the light-headed directors of the bank issued notes in excess of $22 million against a specie reserve of barely $2 million—at a time when the average farm laborer earned about $10 a month. America in 1817 was, as one pamphleteer later put it, a country of “paper gold, and paper land, and paper houses, and paper revenues, and paper government.”
⁴⁵

This paper edifice of prosperity duly went up in flames. In July 1818 the national bank, wary of collapse, directed its branches to sharply reduce the issue of notes. Adding to the sense of crisis, the bank announced that its own loans would be renewed in the future only at a reduction of 12½ percent, with the debtor liable for the balance. Jefferson was with James Madison, about to meet with fellow trustees of the planned University of Virginia, when he got the news. It came upon him, he wrote that day, like “a clap of thunder.”
⁴⁶
He had no cash to cover the depreciated notes. There was nothing to do but seek out more friends and family, and have them endorse more loans. Tormented with anxiety about the mounting financial crises he faced, Jefferson developed a painful outbreak of boils in August. His hopes for relief rested with selling his flour at high prices at the Richmond market.

But now, in September 1818, the other shoe dropped. In an ironic twist to the Tambora tale, it was the return of good weather that doomed the U.S. economy in the post-volcanic period. In 1817, the total value of U.S. grain exports had doubled in value, to $23 million, while the following year Britain imported the greatest volume of grain in its history. Over half a million barrels of American flour passed through the Liverpool docks.
⁴⁷
But with the aerosol dust from Tambora’s eruption washed from the North Atlantic atmosphere by the summer of 1818, normal
crop-growing conditions returned to the European continent, which enjoyed a return of bumper harvests.

The poet Keats, whose brother George had recently joined the tide of British emigrants to the American West, celebrated the return of sunny English harvesting in his famous ode “To Autumn”:

Season of mists and mellow fruitfulness,

Close bosom-friend of the maturing sun;

Conspiring with him how to load and bless

With fruit the vines that round the thatch-eves run (ll. 1–4)

The sumptuous happiness of that poem speaks for the relief of an entire continent. But English “mellow fruitfulness” turned sour on their American brothers across the pond, including Keats’s own, who returned penniless to London during the Panic (only to raid his tubercular sibling’s trust fund and bolt back to Kentucky). As a result of improved European crop yields, the market for American commodities plummeted overnight. Philadelphia wheat went into free fall from a high of $3.11 a bushel in 1817, bottoming out at 82 cents in 1821. A hundredweight of Virginia flour, worth over $14 at the height of the boom, brought only $4 in 1820.
⁴⁸
Meanwhile, cotton prices fell by two-thirds, devastating the economy of the Tennessee Valley. When Jefferson’s flour finally reached the Richmond market, it returned half the price he expected. By September, he was describing to friends the total collapse of his health. It’s not difficult to see the agitating cause. “To owe what one cannot pay,” he wrote at the time, “is a constant torment.”
⁴⁹

By early 1819, the collapse of European demand for American cotton and grain, combined with the national bank’s contraction of credit, had generated a full-blown financial panic in the United States. In February, with the price of flour fallen still further, Jefferson made what must have been a heartbreaking decision: he would sell portions of his Monticello property to pay his debts. Yet greater humiliation followed. In April, he was forced to admit to his agent Gibson that his lands had little market value. The value of property had fallen to less than a year’s rent—and with no buyers to be had even at that price! This latest setback saw Jefferson take on a further debt load totaling almost $11,000, consisting of five separate loans from three banks. His “entanglements,” as Jefferson called them, were now beyond any rational scale. The former president, along with millions of his fellow citizens, was floating on the rim of a giant bubble—reality fast receding beneath him: “All is confusion, uncertainty, and panic.”
⁵⁰

Thomas Jefferson experienced the Panic of 1819 as a profound, personal depression of body and mind. “After two years of prostrate health,” he wrote in the fall of 1820, “you have the old, infirm, and nerveless body I now am, unable to write but with pain, and unwilling to think without necessity.”
⁵¹
In one sense, Jefferson’s pain in these years is purely personal and pitiable: the unfortunate result of an old man’s bad luck and wavering judgment. At another level, however, it stands as a poignant symbol of national distress. Jefferson was never closer to the citizenry he ruled for eight years—and in whose imagination he held such a vaunted place—than during the Panic of 1819, when over three hundred banks across the nation failed overnight. His experience of crop failure, debt, and humiliation after 1816 was shared by legions of his fellow Americans who lost their farms, jobs, homes, and life savings in an economic crisis of epic dimensions. “Never were such hard times,” Jefferson wrote in April 1820 as the U.S. economy subsided from panic into a general depression. “Not a dollar is passing from one to another.” The former president was well aware of the scope of the suffering, both nationally and near at hand. With the people of Virginia “in a condition of unparalleled distress,” a breakdown of civil order seemed imminent. “I fear,” he wrote, “local insurrections against these horrible sacrifices of property.”
⁵²