[legendsport]

PART V - The Panic

THE WHITE HOUSE, WASHINGTON, DC, AUGUST 22, 1819: President James Monroe was facing the first grave crisis of his administration. The economy, which had boomed during the War of 1812, had crashed dramatically in the fall of 1818. The U.S. Government, heavily in debt to the banks as a result of paying for the war, suspended specie repayments. In addition, the end of the war in Europe meant the end of heavy European import of American foodstuffs as the farms of Europe began to produce their own foods again. Unemployment was rampant, with an unbelievable 75 percent of people in the city of Philadelphia unable to find employment.

Making matters worse, the economy of the Republic of New England was doing just fine. The combination of high unemployment and bank failures in border states of New Jersey and Pennsylvania were leading some in those states to openly suggest that the time had come to follow neighboring New York by seceding and joining the R.N.E.

Monroe had called a meeting of his top cabinet members, including Secretary of the Treasury William H. Crawford and Secretary of State Henry Clay. He also - against Clay's recommendation - asked the Ambassador from New England, Nathan Sanford, to attend.

"Gentlemen, I've asked you here for two purposes. First, to find a way to halt the financial panic that is gripping this nation, and second," he looked at
Sanford, "To make plain our stance on the rumors coming out of New Jersey and Pennsylvania that those states are considering secession."

Clay frowned. "With all due respect, sir, I don't believe that Mr. Sanford should be a party to an official meeting of officers of the United States
government."

Monroe waved his hand impatiently. "We've been over this, Henry. Mr. Sanford is an American as are we all. And despite bluster to the contrary coming from
both Boston and Washington City, the economies of both our nation and our cousins to the North are inextricably dependent upon each other."

Sanford nodded. "I agree, Mr. President."

Clay glared, but said nothing further.

Crawford spoke up: "Mr. President, if I may, I think that our New England cousins may be able to help us recover from our economic difficulties."

Sanford turned his attention to Crawford. "I can assure you that we of New England would like nothing better than to see the United States economy right itself."

Crawford inclined his head in thanks. "Good. I believe the first step would be to remove the tariff your government has put in place." And after a short,
meaningful pause, he added: "And put one in place on British trade."

Sanford coughed. "Sir, I can assure you that we will not change our trade policy with the British. To do so would result in the government of New England being overthrown by the mercantile class."

Monroe sighed. "I would hope that our difficulties could be lessened without involving Great Britain." The relations between the U.S. and Britain had
improved in the past two years and Monroe was reluctant to even suggest anything that would jeopardize those improvements.

"I see no way to improve the economy without protecting U.S. exports to both Britain and New England," Crawford replied.

The discussion settled into deep conversation on specifics of trade between the U.S., New England and Britain. But after nearly forty minutes, nothing had
been decided.

"Gentlemen, let's move on to the question of Pennsylvania and New Jersey," Monroe said, exasperated at the lack of progress on the first issue.

"Sir, I can assure you that the Government of New England has had no intercourse with any representative - official or otherwise - of either New Jersey or Pennsylvania regarding those two states possibly joining our confederation."

Monroe nodded. "I expected as much, Mr. Sanford. What I would like to ask, therefore is that the New England government make overtures to those states."

Sanford was surprised. "Sir? I would think that's the last thing you should want."

Monroe smiled, but it was rather humorless. "I do indeed wish an official statement from New England. However, I want that statement to enforce the fact that New England would not accept Pennsylvania and New Jersey into your confederation."

Now Sanford understoood. "I would have to check with my superiors in Boston, but I do not believe they would be willing to make such a statement."

Clay stepped in: "You must stress to your government that if they fail to discourage this talk of secession, it will be viewed here as tacit approval or even an invitation to join your nation."

Angrily, Sanford snapped back: "It is not the responsibility of the Republic of New England to hold the United States together!"

Clay was about to reply when Monroe raised his hand. "Gentlemen, please! I did not mean to suggest, Mr. Sanford, that New England should be considered
responsible for holding these states in the Union. However, I would think that an official statement clarifying the Republic's position, would be appreciated."

Sanford took a deep breath. "Sir, I can tell you that my government is not actively pursuing the secession of any state currently in the United States. But I also can say that my government will not make a statement encouraging any state to remain in the Union should that state seek its own path - whether that be to join the Republic of New England, or to create a new nation of its own."

Clay's voice was cold as he responded. "You may assure your government, Mr. Sanford, that the United States will use force of arms to keep New Jersey and
Pennsylvania in the Union. And should New England interfere, we will bring that force of arms to bear on your newborn Republic."