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The Specie Circular and Sales of Public Lands: A Comment

Published online by Cambridge University Press:  03 February 2011

Richard H. Timberlake Jr.
Affiliation:
University of Georgia

Extract

The chronology of events in 1836 surrounding Jackson's Specie Circular and the Act to Regulate the Deposits of Public Money, under which the Federal fiscal surplus was distributed to the states, has never been much in dispute. The orthodox analysis of these events likewise has been almost universally accepted. The Specie Circular has been seen as a device that provoked an increase in the demand for hand-to-hand specie in the West where the public lands were being sold, at the same time that specie was needed in the East to effect the distribution of the surplus. The monetary system could not have its specie in two places at once, the argument has been, and the attempt to do so led to the disastrous breakdown of the banking system and to the ensuing business recession of 1837.

Type
Notes
Copyright
Copyright © The Economic History Association 1965

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References

1 The most interesting source book on this matter is the one first compiled: Bourne, E. G., The History of the Surplus Distribution of 1837 (New York, 1885).Google Scholar

2 Timberlake, , “The Specie Circular and the Distribution of the Surplus,” Journal of Political Economy, LXVIII, No. 2 (Apr. 1960), 109–17.CrossRefGoogle Scholar

3 The Pet Banks in Jacksonian Politics and Finance, 1833–1841,” Journal of Economic History, XXIII, No. 2 (June 1963), 196214.Google Scholar

4 This figure is the average volume of land sales per month during the first quarter of 1837.

5 Timberlake, , Journal of Political Economy, LXVIII, No. 2, 111.Google Scholar

6 Bank notes and deposits necessarily tied up some specie as reserves, and nothing prevented sales being made in specie before the Circular was in effect.