The Half Has Never Been Told: Slavery and the Making of American Capitalism (54 page)

Yet the destruction of the B.U.S. and the ensuing deployment of banking innovations didn’t make the
southern financial environment more democratic. For instance, when Franklin Plummer, the champion of the people of southeastern Mississippi, visited Natchez before the 1835 state elections, men who ran the new banks bought him a fancy carriage. Plummer then reversed his rhetoric against the use of state power to deliver bank goodies to insiders and campaigned for a slate of pro-bank candidates.
When elected, these pro-bank state legislators sent Robert Walker to Washington as senator, deposing George Poindexter from office. Walker had depicted Poindexter as the servant of the Monster Bank, an arrogant opponent of white male equality. Now he and Plummer encouraged the Mississippi legislature as it chartered so many banks that by 1839 the state’s total on-paper bank capitalization was $63
million—more than the national B.U.S. at its largest. And old insiders managed to remain insiders. Stephen Duncan, leader of the old Natchez-based Planters’ Bank, launched a new bank, which the state legislature chartered. Henry Clay wrote his Mississippi allies in 1834, asking a Duncan ally to give his son a loan so that he could buy a Mississippi cotton plantation: “I have a number of surplus slaves
here, principally young and well adapted to a cotton plantation.” Banker and planter were often the same: ten of the top eleven borrowers from the Union Bank of Florida were members of its
board of directors, or immediate relatives thereof. While some charters required new institutions to distribute loans in a more geographically equal fashion than had predecessor banks, the new banks did nothing
different from the B.U.S. when it came to distributing credit to lower-class men. Thus, those who had derived political benefit from common white men’s insistence on equal manhood replaced the B.U.S. with an insider-favoring banking system.
⁸¹

“The people” thought they had slain the monster, but the stumps sprouted new heads that feasted on the huge sums of capital being imported via European
sales of state bonds that securitized slave mortgages. All of these innovations planted a crop of dramatic consequences. Securitization’s ability to export risk away from the immediate lender enabled unregulated borrowers to expand leverage without end. Here’s how the equation worked. In 1835, a cousin told Anna Whitteker that “each of his hands made $500 last year, raising cotton” in Mississippi.
If remotely true, that kind of revenue would mean a return of over 30 percent per year. Enslavers with access to bank credit could now borrow money on slaves at 8 percent. The margin between anticipated returns on borrowed capital and its cost to borrow was thus huge. And the direct risk appeared to be negligible. State-guaranteed slave-mortgage bonds dispersed much of the immediate risk of borrowing
to others—to bondholders, to taxpayers, and, above all, to the enslaved. In addition, entrepreneurs themselves—including judges, politicians, and state officials—controlled debt collection in their states, making it less likely that elite borrowers would be foreclosed, even if they fell behind on payments. Banking elites had the recourse of socializing the losses—making the whole population pay
off the debts of failed enterprises—just as the old Plummer (pre-carriage) and the old Walker (pre–bank war) had once warned. So as enslavers multiplied their leverage, they multiplied their revenue without increasing their individual risk. In response to these clear incentives, enslavers created still more ways to leverage slaves into still more leverage. They mortgaged the same collateral from
multiple lenders. They used slaves bought with long-term mortgages to bluff lenders into granting unsecured commercial loans. Above all, they kept buying more slaves on credit. Even if they ran into problems, they figured they would still win, because they could sell their assets. For the slave prices were still rising.
⁸²

Yet the consequences of seemingly infinite and risk-free leverage were
perverse, and not just because sexual predation helped stoke the risk-taking atmosphere. Securitization enabled both the immediate borrower and the immediate lender to escape the direct consequences of risk—economists call
this “moral hazard”—even as they dramatically increased the total risk accumulated in the financial system. The multiplication of total leverage dramatically amplified the general
consequences of a potential setback, such as a sudden decline in the cotton prices by which enslavers multiplied pounds picked per hand to calculate anticipated revenue. Yet by late 1834, few were thinking about such possibilities. The biggest boom yet seen in the history of slavery’s expansion began to swell as money from the new southwestern banks seeded the region with enslaved hands ready
to meet a sudden increase in European demand. In 1832, cotton brought 9 cents per pound. By 1834, a woman reported from the Huntsville slave market, “cotton [at] 13 cents . . . has turned their heads.” In 1835 cotton hit an ecstasy-inducing 18 cents per pound. And demand for slaves kept soaring. “I have just returned from Charlottesville court, great many buyers[,] and negroes was scarce and high,”
reported Rice Ballard’s employee from a buying trip along the Blue Ridge Mountains.
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“People here are run mad with speculation,” wrote one visitor to the former Chickasaw land in northeastern Mississippi. “They do business in . . . a kind of phrenzy [
sic
]. [Gold] is scarce, but credit is plenty.” In 1835, government land offices in Mississippi sold 2.9 million acres, more than had been sold
in the entire nation in 1832. A few found frenzy worrisome. “We have not yet reached the neighborhood of a sufficiency of Banking Capital—but taking this as true I would prefer to approach the point gradually, and not with such rapid strides,” wrote a Louisiana man in 1835, after the legislature chartered four banks in two days. Cheap land was vanishing, wrote a migrant to newly organized Noxubee
County, Mississippi. “Speculators and cappitalist [
sic
] all have an idea to it. I have never in my life seen such a rush for land.” Next, he predicted, came the forced migrants—“this country will be a perfect negro quarter”—who, underfed by gambler planters, “will kill your pigs hogs and cows, I feal the effects of it already.”
⁸⁴

But the tunnel vision of one-eyed men seemed to be working. Banks
were lending, and land bought by speculators at the government minimum of $1.25 sold at $20 per acre. The clanking of chains rose from the roadways leading into the courthouse towns; entrepreneurs looked at their ledgers, at bales stacked by the landing, and at the men and women trudging out to the springtime field; light-skinned women stood in front of tables where traders poured their drinks
and negotiated a price. Prosperity trickled credit further down the chutes and slides of the southwestern economy into the pockets of slaveholders, overseers, and random white men with smooth tongues. Like Anne Royall cresting the hill and rounding the Alabama bend back in 1819,
most white southwesterners thought they could see, spread out before them, a glorious future shining in a bubble. It
looked like that first day when ten thousand little seedlings in the cotton field had obviously become a host of young plants. The green muscled its way upward, into the sight of the slave owner’s focused eye. Who knew how miraculous the crop of his seed might become?

8

BLOOD

1836–1844

H
ERE WAS WILLIAM COLBERT
’
S
awakening. In the middle of the night, a gruff white man’s shouts splintered his child’s deep sleep, and then, on a lower register still came his older brother January’s voice in response. Some other antenna began to rattle. William was sensing that his parents were in distress. Whenever that happened, William always looked for big brother
Jan, tall and unbroken. And now, William was out of bed and accelerating out the door of his parents’ cabin toward the sound of January’s voice.

He stopped like a braked wheel. The full moon shone on January tied to the pine tree that stood across the yard from the long row of shacks. The white man stood behind January with a bullwhip. A silent chorus of enslaved people watched from their porches.
And the young man—caught on the way back from visiting a girl at the next labor camp—refused to cry.

January clenched his teeth, trying to endure any amount of pain rather than confirm submission with tears. On slavery’s frontier, however, the blood that ran usually showed a white man’s potency. And it was running down January’s chest and back. Not for him was the right to say “enough”; to act
on his own desires rather than his master’s. Each stroke was meant to force him to crawl. But still he held out. “What’s the matter with you, nigger?” growled the white man. “Don’t it hurt?”

Maybe the slave owner’s arm was getting tired. But after a decade in which millions of measured lashes had doubled cotton production, he knew that consummation was coming. William could remember his own agony
at this moment, how with head on knees he had “sat on my mammy’s and pappy’s step a cryin’,” sobbing with each choking grunt that came from his brother’s clenched teeth. He could not articulate it, but William was coming to
understand what the scene implied for him, and for the dreams he didn’t even dream yet. The others had seen this script rehearsed a thousand times. “Some of ’em couldn’t stand
it; they had to go inside their cabins.” Like the fathers and brothers in the cabins, January could not be for long the man that he had imagined himself becoming as he had returned, elated, from his rendezvous with that girl. “After a while January couldn’t stand it no more hisself, and he say in a hoarse, long whisper: ‘Massa! Massa! Have mercy on this poor nigger!’” Eighty years later, William
cleared his throat, paused for a moment, and changed the subject.
¹

THE DRAMAS OF WHITE
manhood inflicted havoc not only on black women’s lives but on African-American men as well. Those dramas cut and stained enslaved men specifically
as men
, systematically denying them the opportunity to assert traditionally masculine roles. Lewis Clarke, an escapee from the whipping-machine, once told northern
white audiences that his most visceral experience in slavery was learning that “
A SLAVE CAN’T BE A MAN
.” Like free men, enslaved men also felt that manhood required them to defend self and family and other victims from violence. When Samuel Ford bullied the men on Jacob Bieller’s cotton camp, deep in the Louisiana woods, they tried to puncture his domineering-overseer act. He told them he would
whip them, and “they swore not a negro on the place should be touched for it. They have gone so far as to shake sticks over my head and threaten my life,” wrote Ford to Bieller, his boss. All along slavery’s frontier, African-American men pushed back against assault and humiliation, the two master teeth of the whipping-machine’s gear: “Washington who was in the woods come up this morning,” wrote
a Louisiana overseer. “I undertook to whip him for his conduct, [and] he raised his hoe at me and swore I should not whip him.”
²

“Such conduct as that I cannot stand on a place that I have to manage,” Ford had concluded in the letter to his employer. Enslavers might not have understood everything about enslaved men, but Ford and his peers knew that allowing assertive behavior to stand would only
lead to further boldness both there and all along Bayou Boeuf. Leaving a threat unpunished also carved a wound in the enslaver’s persona. Look at the letter written by enslaver Joseph Labrenty of Alabama: “Rather than take $700 for Alfred,” a runaway who had escaped recapture, “I would rather go into the woods and mall [
sic
] rails for the next twelve months to pay the reward to have him shot.
. . . I wish to god that I could get within 40 yards of him with a double barreled and if I did not stop him I am much mistaken.”
³