isa-normaladvance-1913-00249

Description:	THE NORMAL ADVANCE249which they believe they are seconded by theunanimous voice of their fellow-citizens of thisstate.01 This bank was given the right to deposit the public moneys, but it soon failed utterly in its business.By the end of 1819 popular sentiment hadsoftened toward the United States Bank. Thelegislature which met in December of that yearauthorized state and county collectors to accept notes of the banks of the United Statesor its branches, or in the notes of the charteredbanks of this state or their branches, or anyof the state banks and branches of other states,that pass at par Avithin this state.52This legislature also passed one of those ingenious laws for the relief of debtors. Bythis act, if a debtor could not meet his obligations, the sheriff should provide for an inquestof five respectable freeholders, avIio shouldestimate the value of the property of the debtorwhose property was to be sold under execution.No property was to be sold for less than two-thirds of the returned value of the inquest.If the property would not sell for at least tAVO-thirds of its assessed value, then there shouldbe a stay of execution for one year. It is obvious that in a community Avhere nearly all thepeople were debtors, it Avould almost be impossible to get five respectable freeholders AvhoAvould assess the property Ioav enough that itAvould find a purchaser eAren at two-thirds itsassessed value. This laAv is typical of manylaAvs that Avere passed for the relief of debtorsduring this financial crisis.Congress also came to the relief of thedebtors. In fact, relief acts in some form orother had been passed by congress nearly everyyear since lands were put on sale in Indiana.In 1818, 1819 and 1820, relief acts Avere passedfor the benefit of debtors. By these acts,debtors whose lands Avere subject to forfeiture,Avere given an extension of credit for one year,if the holding did not exceed 640 acres. Bythe last of these acts the final period of forfeiture Avas extended to March 31, 1821.53LAND SYSTEM REVISED.Other national legislation which did moreto relieve the debtor class than any other lawsyet passed, was to folloAv—legislation whichAvould prevent men from getting into debt tothe government. All the factors mentioned byobservers, farmers and statesmen as being instrumental in bringing the economic distressupon the Avest in 1818-19 possibly operated.Extravagant living and excessive buying fromthe east the drain of money from the westthrough the land offices reckless speculation inlands and town property bad and carelessbanking the restrictions placed by the secretary of the treasury upon the kind of moneythat Avould be received from the land purchasers—all these undoubtedly operated inbringing disaster to industry in the west. Butone factor stands out distinct and fundamental,and above all the other causes that Avere influential in bringing on the depression. The creditsystem had been abused. Banks and individuals had loaned money without sufficient security, on investments that were not likely to paydividends. The United States goernmeni hadunduly encouraged speculation since 1800 bygiving four years credit to purchasers oflands. As a result, the greater part of thepeople in the Avest Avere in debt, and could notmeet their obligations. They had bought beyond their capacity to pay. By December 31,1820, the total indebtedness at the land officesin Indiana alone Avas $2,214,168.63, Avhichamounted to a per capita indebtedness to thegovernment alone of $15 in a population of147,178. In a country where acceptable moneywas not to be had, this Avas virtual bankruptcy.The past tAventy years of the credit system inthe operations of the public land sales hadshoAvn its incompetency. It had Avorked disastrously for the people for whom it was devised—for the settlers. In 1820 congress passed anact establishing a neAv system of land sales—acash system. Treat, the historian of the earlyoperations of our national land system, says ofState Papers. Cong. 17, Sess. 1, Doc. 66, P. 47.-State Laws, lS19-20, P. 159.53Treat, P. J., National Land System.Amer. State Papers, Public Lands, III, P. 561.
Source:	http://indstate.contentdm.oclc.org/cdm/ref/collection/isuarchive/id/34694
Collection:	Indiana State University Archives

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