# 1301.10c - Panic of 1819 and the Missouri Compromise

**Channel:** Chad Tomaselli
**Source:** https://www.youtube.com/watch?v=U7X7TAEzGvM
**Transcript page:** https://www.withtranscript.ai/video/U7X7TAEzGvM

## Chapters

- 0:00 — Panic of 1819 and Economic Fallout
- 3:54 — Missouri Statehood Sparks Sectional Crisis
- 6:07 — Talmadge Amendment and Missouri Compromise
- 10:48 — Lasting Impact of the Compromise

## Transcript

**[0:00]:** there were two more major events in the Era of Good Feelings and as we'll start to see that good feelings was starting to not feel so good the first of which we'll talk about is the panic of 1819 after the war of 1812 and this and and after the second Bank of the United States was brought back the banks will be flush with cash and they will loan money constantly in particular they'll loan money for what's called land speculation particularly on Western Land uh that was very common and it led to massive inflation just be clear I've talked about it before but just to be clear speculation is simply buying something expecting the value to rise in the future so you can sell that thing for a profit it's not a bad practice by itself as long as it's regulated or contained um but often speculation doesn't end up that way if unchecked it can

**[0:52]:** lead to inflation of values and prices based on nothing other than the potential future value not based on the actual value when a lot of people are buying into a thing thinking it becomes valuable there's high demand the prices go up but it the prices eventually go up beyond what the the thing that's being speculated on is actually worth

**[1:14]:** eventually when you have this unchecked speculation a bubble will develop and what must every bubble eventually do burst and that bubble will burst in 1819. what eventually we call the panic of 1819 because back then we didn't call them recessions or depressions we called them panics which I think is a more more fun term looking back but I don't know if I would want the government to come out and say well I we're in a panic you know what mean um here in the panic of 1819 the economy tanked people defaulted on their loans land was lost by settlers and speculators alike people both in the South and in the west including a rising politician named Andrew Jackson blamed the banks and Clay's American system and policies for this panic now the president at the time was James Monroe and Monroe and many of the other members of the government regardless whether they were the new or the Old Guard followed the the the the narrow economic philosophy at the time called laissez-faire I've mentioned that before back all the way

**[2:22]:** when we talked about mercantilism where mercantilism was strict government control laissez faire is the government is hands off no regulation of the economy no help of the individual so Monroe believed the economy would ride itself with minimal government interference and the economy slowly did recover but not really until 1823 took four years for this um they didn't really have you know it's easy to say well they should have done something but that wasn't how they thought and there wasn't really mechanisms in place to do something not like we have today the significance of the panic is two things two-fold one it was the first major economic crisis for the U.S there had been depressions before but nothing like this um the hundreds of banks will close across the country second it showed sectionalism starting to arise in National Politics the division of the how this was received and how it affected the country between the

**[3:23]:** South the west and the north of particularly particularly the South and the north is where you start to see some of the north versus South really come to the Forefront it's only just starting the next event we talk about will discuss that even more so this was a major issue that affected everyone the speculation on land in particular caused major issues because the there was no oversight the second event for this video which we'll spend a

**[3:54]:** little more time on because it's a bigger more complex event is the Missouri crisis in 1820 there were 11 free states and 11 slave states since 1804 there had been more free states or at least an even number of free enslaved States this was becoming more of an issue and a rift was starting to develop between the North and South over this what kicks off this crisis is that the territory of Missouri an organized territory and one that also was a slave territory a territory that allowed slavery they applied for Statehood in 1819. the final step of the statehood process going back to the Northwest Ordinance of 1787. so they applied for Statehood in 1819 and a crisis will erupt because this would mean the country would have more slave states than free states for the first time since 1804. the north opposed Missouri statehood on uh political not moral grounds remember anti-slavery was the majority not abolitionism whether gradual or radical

**[5:07]:** the bigger concern was keeping a balanced Congress and the uh the the other biggest current was keeping a balance in Congress and also a concern for the continued effect of the Three-Fifths Compromise on how uh representation in Congress was calculated this would also give the slave states a majority in the Senate and the South I'm sorry the north didn't want any of this and again everyone at the time consider this a political issue not a moral one the north did not care as a whole about the plight of slaves nor did they want a bunch of freed slaves living among them The South was in transition from the argument of necessary evil to positive good but they were still but also uh were mostly about the political power for them as well so they were in the process of switching from necessary evil to positive good um that and as I talked about will take

**[6:00]:** full force starting here but really picking up after Nat Turner's rebellion in in 31.

**[6:07]:** um so this crisis was building and then we have something called the Talmadge amendment in 1819. this was in addition to a Bill in Congress and it concerned Missouri's application for Statehood so Talmadge amendment was proposed by a uh I believe a senator not a a representative but a senator named last name Talmadge I don't remember his first name probably James it's usually good guess Talmadge who added this to the bill regarding Missouri statehood applications it was an amendment an addition um what it said was that if Missouri became a state No New Slaves could be brought to the state and the children of existing slaves would be freed at age 25. this is a textbook example of gradual emancipation cut off the source of slaves over a long period of time this mate I guess he was in the house it made it through the house but it was defeated in

**[7:06]:** the Senate the debate over this raged and and led this to be a crisis um this led to talks of disunion and even talks of a potential Civil War both in Congress and across the country but a compromise will be worked on to try to solve this try to Stave off a civil war to try to solve this issue now and in the foreseeable future the man who put this together the Missouri Compromise was the Speaker of the House Henry Clay this is the first of his three compromises that prevents a civil war the compromise had three main points first Missouri was added as a slave state with no restrictions from the Talmadge Amendment so Missouri you see here Missouri added as a slave state with no restrictions second to keep the balance Maine was broken off for Massachusetts and now a free state it was added as a free state Maine had been part

**[8:20]:** of Massachusetts the entire time but they had been wanting a separate statehood they wanted to go from being um part of the state of Massachusetts to being um their own State and so this was naturally an excellent choice to keep the balance so Missouri 0.1 is added as a slave state with no restrictions Maine breaks off from Massachusetts is added as a free state so the balance is preserved so that solves the immediate crisis but what about the future point three the compromise divided the remaining Louisiana territory along the line line of latitude the 36 30 line 36 degrees north 30 minutes that's what the the the diacritical markers mean that's not a diet critical marker the degree symbol the this means minutes the apostrophe um right here what it said was that new territories only new territories and States new territories new states that came out of the territory north of the line had

**[9:31]:** to be free of slavery but new territories and States south of the line could be free or slave they could have either one it was up to that individual territory and new state it only affected new States and new territories it did not affect existing States whether they were free or slave only new ones so all this area in green whatever happened with the Arkansas territory this right here was what was affected new States and territories north of the line had to be free the significance of the compromise this was the first time the states clashed over the slavery question the slavery question was does Congress have the right or power to restrict the expansion of slavery this is the question that ignites the Civil War not the morality of slavery but the expansion the debate over the expansion of it to new territories does Congress have the right or the power to restrict the

**[10:32]:** expansion of slavery second significance they believed that the 3630 line would end the debate over this question forever obviously it did not

**[10:48]:** third it showed the continued influence and significance of the Three-Fifths Compromise remember the north was a one of the big reasons they were against this because if there were more slave states it would un it would could uh keep the imbalance that came from the the Three-Fifths Compromise because the slave states had more more representatives and more power than they should they have because they were counting slaves as part of that number so it shows the continued influence and significance of the Three-Fifths Compromise and then fourth and final this is yet another origin of Southern sectionalism particularly concerning slavery one of the first times we see the south uniting over this issue and thinking of itself as a united front right we had started to see the north-south divisions with the panic but as far as the southern sectionalism particularly with slavery this is really one of if not one of the uh one of

**[11:44]:** if not a a particularly major origin of that where the South largely band together in defense of slavery and the expansion of it again related to the slavery question so that's the Missouri crisis and compromise nearly a Civil War and there was some talk of secession particularly from within South Carolina but never really went anywhere and Clay was able to help offer this compromise to put it off we have one more topic to talk about in the Era of Good Feelings and that is the event that ended the era an absolutely nuts election and we'll get to that next