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Sunday, November 18, 2012

GEORGIA PEACHES Part Ten

I suppose you've heard the story of how a group of civic minded men had gathered in Philadelphia during the summer of 1787 to create a “more perfect union”. Well, they did, except it would be well to remember that civics is not a science, but an art form, in which each artist expresses a different vision of perfection. And in the case of James Wilson, future justice of the Supreme Court under the new constitution and future briber in-chief for the Yazoo land fraud, perfection included the right to make a profit at the voters' expense.
Remember the story of Robert Morris and the Bank of North America? That was the financial institution which Morris had used to finance the American Revolution. Well, the bank had originally been chartered in Pennsylvania, and after the Revolution its charter had been revoked by Pennsylvanians worried about a big financial institution having too much influence in their government. But in 1786 the state was sued by a share holder in that bank, who claimed the repeal had violated the rights of an innocent party – i.e. him, James Wilson. And a year later Mr. Wilson was one of those civic minded men who gathered in Philadelphia to draw up the new Constitution for the United States.
The state of Pennsylvania had backed down from Wilson's lawsuit, and re-charted the bank. But Wilson was determined the new Federal government would not show the same disrespect for business. So, in drawing the new design for government, James Wilson added what became Section 10 to the first Article of the constitution, supposedly dealing with the formation, duties and responsibilities of the Congress. Section Ten, Article One stands out as an add on. It reads in part; “No State shall enter into any Treaty...coin Money...pass any Bill of Attainder, ex post facto Law, or Law impairing the Obligation of Contracts, or grant any Title of Nobility...”. This was to be a capitalist nation, and respect for contracts was written into its constitution.
All of which brings us back to the second Yazoo land sale of January 13, 1795, and specifically a week after the big one,  when the state of Georgia sold an additional 11 million acres at ¼ a cent per acre to Senator James Gunn, George Walker and others operating under the name of the Georgia Mississippi Company. The sale price for the Georgia Company's share had been $50,000 down and $200,000 by November 1, 1795. The down payment was accepted, and in August of 1795 all shares of the Georgia Company were bought by James Greenleaf (partner in Robert Morris's North American Land Bank). He paid 8 cents an acre for the land. But in November, when Greenleaf tried to make the final payment of $200,000, it had to be placed in escrow, because Georgia politics had changed.
On February 13, 1796 the new Governor had signed “The Rescinding Act', canceling all of the Yazoo swamp-land sales, including that for the Georgia Mississippi Company. Author of the act, James Jackson, was determined to drive a stake through the heart of the Yazoo speculations. The down payment and the final payments were returned to the original buyers. The deal was dead. But on that same day, James Greenleaf sold all 11 million acres owned by the Georgia Mississippi Company to yet another group of speculators, who called themselves the New England Mississippi Company. He was paid $1, 380,000. That was a 650% profit. The price of Yazoo swamp-lands had inflated from ¼ cents an acre paid to the citizens of Georgia in 1795, to almost 8 cents an acre paid by James Greenleaf, and now eleven cents an acre paid by the New England Mississippi Company, just a year later. Except the deal was dead. The original sale had been canceled by the state of Georgia. The money had been returned, and accepted. Why were these speculators still paying so much for shares of a dead deal? Who were these savvy business types who had never heard of Caveat Emptor?
Listed first among the directors of the New England Mississippi Company was Benjamin Hichborn, a cousin to Paul Revere on his mother's side. Benjamin's father was a Boston shipwright, who had sent his son to Harvard, which Benjamin graduated at the age of 22, in 1768. Benjamin passed the bar, but was then swept up in the revolution, displaying an impetuousness of youth which got him locked up on a British prison ship. He escaped after two months, but he seemed to have learned his lesson. Afterward he restricted himself to financing other revolutionaries, paying for privateers, and helping Henry Knox purchase farmland, and arraigning investments for John Adams and John Hancock. But Benjamin's real talent was as a gossip, knowing which ear would be most receptive to which dirt. In the late 1790's he aligned himself with the Jeffersonian Republicans, becoming a trusted and rare New England confidant for Thomas Jefferson himself. 
The other company directors were equally well connected. Samuel Brown had made a fortune financing the slave trade, insuring ships which were running the British anti-slave patrols off the African coast. Benjamin Joy was a speculator in Massachusetts real estate, and Thomas Winthrop was the thirty-something son of the iconic Boston family. George Blake was yet another lawyer-speculator . And finally there was John Peck.
He was already 75 years old in 1800. He was secretive, “Often argumentative and egotistical, tending to alienate those with whom he interacted”. Most people knew him for what he considered his hobby – he was “The most scientific and most successful naval architect” in the new nation, having designed small and fast privateers for the colonial navy. But someone else had to build them, because John did not work or play well with others.
John Peck saw himself as a merchant, starting with a store and trader's post on Crabtree Neck, where the Skillings River flows into Frenchman's Bay, not far from Bar Harbor, Maine. It is still labeled Peck's Point on the maps. John Peck invested his profits in land, and there are few communities in today's Maine,which do not list him on their early property rolls. So it was a natural that the wealthy landowner would be asked to join in the New England Mississippi Company. And it was John Peck who on May 14th, 1803, sold to Robert Fletcher of New Hampshire, 15,000 acres of the New England Mississippi company holdings for the sum of $3,000. The price of the Yazoo Swamp-land had surprisingly risen to $5 an acre. If the lawyers are to be believed Robert Fletcher felt cheated by Peck, and later in 1803, just like Mr. Chandler in 1603, sued to get his money back
Robert Fletcher was a lawyer from Amherst, New Hampshire, He was only 42 years old in 1803, and owned extensive properties in Nashua, Amherst and Dunstable. He was a very successful husband, fathering 13 children, but ultimately, an unsuccessful businessman. His final investment was in timber lands in Montreal, Canada. And when this venture failed in November 1809, Robert Fletcher shot himself. But even after his suicide, the court case he had help launch continued all the way to the Supreme Court – just as it was intended to. It was a set up, a fake case. And everybody knew it.
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