State Promotion and Regulation of the Antebellum Economy

As in Congress and in the state legislatures, the popular foundations of political power guided mixed economic activity. Parties contended over state intervention in the economy with as much if not greater vigor than on the national level. The pattern of events in the states was much like that in Congress: a burst of legislative activity early in the nineteenth century followed by a decline in the wake of the Panic of 1837. Intrastate rivalries generated competing demands on each state's limited resources for legislative support of economic development. When some of these mixed economic schemes collapsed, the Democrats, who had themselves argued in favor of many of the programs, seized on the political possibilities presented by a disillusioned public to slap restrictions on legislative authority. Throughout, the Democrats charged that active government favored the few at the expense of the many.

Each legislature enacted its own distinctive promotional and regulatory statutes. The division between what was a regulatory and a promotional measure blurred, in part because the scope of these activities was much broader in the states than at the federal level. As well, in the 1840s and 1850s, the states admitted to the Union in the area west of the Mississippi had frontier economies, while those in the settled East were entering a period of mature economic development.

Even though the laws governing each state's mixed economy were unique, general patterns did appear. Of these, one of the most important was the singularly American vision of the state as a "commonwealth." The commonwealth idea "was essentially a quasi-merchantilist concept of the state within a democratic framework.? ²¹ The state existed to ensure that the "rights of the public" took precedence over any individual or group interest. The commonwealth idea fitted well with federalism, because it left the states, as sovereign entities based on their own organic laws, to act directly on the citizenry. The federal Constitution reserved to the states the police powers to provide for the health, safety, morals, and welfare of their citizens. The dominant partisan majorities in the state legislatures invoked these powers both to regulate and to promote private bargaining on a scale far more intense than anything undertaken by Congress.

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Date: 2015-01-29; view: 911