GEORGIA PEACHES - Chapter Eight

I think Patrick Henry's (above) death may have been a release. At the urging of George Washington, in the spring of 1799, Patrick stood for one last election - for the Virginia House of Delegates. He ran as a Federalist. Patrick won his last election, but never occupied his seat. He died of stomach cancer on 6 June, 1799. His second wife, Dorothea, quickly married Patrick's friend, Judge Edmund Wilson, thus protecting the family investments from predators who might have cheated a naive widow, probably a predator like  Judge Edmund Wilson.

Once the details of the Yazoo Land sale became public, Senator James Gunn (above) was universally despised. Six years later, toward the end of his term he announced he was “disgusted with everything connected with public life.”  It was certainly disgusted with him.  In March of 1801 he returned to the old state capital of Louisville, Georgia and at the end of July, in a room full of people, James Gunn died so quietly no one noticed he was dead for several minutes. That would have galled him. One obituary called him “General Yazoo”, a reminder of those runaway slaves he had murdered so many years before, and the millions of dollars he had tried to steal from the  tax payers.  A kinder obituary hoped he was “beyond the reach of friendship, or of hatred.”  Not me.

James Jackson was twice elected Governor of Georgia. In his first two year term he personally wrote sections 23 and 24 of the new Georgia constitution, which insured that " “no...order shall pass the General Assembly, granting a donation or gratuity in favor of any person whatever...” except by a two-thirds vote.  During his second term, in 1802  he finally disposed of the temptation of the Yazoo Lands by selling them to the Federal Government for $1,250,000. Georgia was no longer broke. For awhile.

And when the “Prince of Duels” died on 19 March, 1806, no one was more surprised and disappointed than James Jackson, that he met his demise quietly in his own bed.

Most of the speculators who tried to profit from the selling the Yazoo swamp  -  Patrick Henry, David Ross, Robert Morris, John Nicholson, James Wilson and James Gunn - lost everything. Taking a profit would be up to the next generation of “land jobbers”, starting with John Peck, and his partner in “ legal crime”, Robert Fletcher.

The story goes - and it was a fictional story - that on 14 May, 1803, 75 year old John Peck sold to 43 year old Robert Fletcher (above) 15,000 acres of Yazoo swamp around the Tombigby River, in exchange for $3,000, or about 4 and 1/3 cents an acre.  Fletcher was supposedly concerned about receiving a clear title because of the "The Rescinding Act”,  so Peck had included the following addendum, insisting that,  “The title to the premises as conveyed by the state of Georgia (in 1795)...has been in no way constitutionally or legally impaired by virtue of any subsequent act of any subsequent legislature of the...state of Georgia.”

The addendum was important because of that 1603 English case of Chandler v Lopus, which you remember (I'm sure)  established the legal doctrine of Caveat Emptor - buyer beware.  Peck had now provided the guarantee in writing that the 1796 Rescinding Act did not apply, even though Georgia had just sold the Yazoo Swamp-Land to the Federal Government. And in doing so, he had provided legal grounds for Fletcher to sue Peck to get his money back. But then that was not really the point of the entire transaction.

Because Fletcher was a resident of New Hampshire and Peck resided in Massachusetts, the case moved directly into the federal court system – what a lucky break that was. There  it was heard at the circuit court level by the cranky, craggy 74 year old Federalist New Englander, William Cushing (above) , who was also a Supreme – another lucky break. Cushing  decided the case for Peck, which allowed Fletcher to appeal to the Supreme Court.

And it is now that the final character in our farce, John Marshal (above), steps upon the stage. He was a cousin to Thomas Jefferson, and a close friend to George Washington. When the case of Fletcher v Peck reached the high court in March of 1806, Chief Justice Marshall decided that the arguments made by Peck's team of lawyers had been “incorrect”, and so the case was “continued by consent”,  meaning held over for the next term, to be re-argued (or better argued) in October of 1807.  

And even then, Marshall did not issue the final ruling until 16 March, 1810, 3 years later, probably because it took him that long to cajole an unanimous decision. The decision had to be unanimous because for the first time ever, the Supreme Court was declaring that a state law - the Rescinding Act -  violated an article of the Federal Constitution – in this case, section 10 of Article One.

As usual, Marshall wrote the court's opinion. He acknowledged that the members of the 1795 Georgia legislature were guilty of reprehensible actions. However, he reasoned, “The grant, when issued, conveyed an estate...(and) This estate was transferable; and those who purchased parts of it were not stained by that guilt which infected the original transaction.” Thus was born the legal fiction of the “innocent third party” in the Yazoo land fraud, meaning the speculators who had bought the land from the men who had bribed the legislature were not the same man who had committed the sin, working under the mask of a corporation.

Marshall argued that if a concealed defect in a contract could be held against the victim of that concealment, then “All titles would be insecure”. That might be true in the abstract, but referring to the members of the New England Mississippi Company as “innocent” was almost as much a legal fiction as insisting that written guarantees protected buyers in an age when only 3% of the population could read.

Oddly, the only member of the court to disagree with Marshall in writing was Jefferson's only appointee on the court,  William Johnson (above), from South Carolina. And his only objection was that he thought the Indians had a better claim to the land than did the state of Georgia. Still, Johnson managed, at the end of his argument, to state the obvious. “I have been very unwilling to proceed to the decision of this cause at all,” he wrote, because, “It appears to me to bear strong evidence... of being a mere feigned case.” 

But having stated the obvious, Johnson then folded his tent and concurred with Marshall's decision. And so the court had decided in favor of the New England Mississippi Company and all the other speculators in the Yazoo land sales.

The cost of that decision became clear in 1814, when the Federal government reached a settlement with all the “innocent third parties” in the Yazoo land fraud. Having already paid Georgia $4 million in 1802  for the swamp land -  the modern equivalent of $63 million -  they now paid the speculators in the various Yazoo companies another $5 million for the same swamp - the modern equivalent of $50 million - over 113 million dollars for a swamp which grew little more than mosquitos, turtles and alligators.

It made Patrick Henry's scheme to cheat the tax payers of Georgia seem small potatoes. And this would be far from the last time the lawyers wrote and interpreted laws to assist thieves in robbing the public. Such behavior is a stab to the heart of the public's faith in their government. And it all began at the very birth of that Republic.

It was the next generation of Americans who would risk their fortunes to build levees, to drain the Yazoo swamp and keep the Yazoo river to a path, and who would finally lay bare some of the richest agricultural soil in the world, upon which they would plant and grow cotton. There were profits aplenty for all...except, of course, for the natives who had originally owned the land and the slaves who picked the cotton. It is a sad truth about speculators that like villains in a horror story they generate life for no one but themselves, and misery and debt for everyone and everything else they touch.  And capitalism empowers them.

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GEORGIA PEACHES Chapter Six

I do not doubt state Representative and ex-U.S. Senator James Jackson (above) when he said he was prepared to shoot every man who voted for the Yazoo Land sale. Jackson was a well known as a duelist. In fact after the new state legislature convened in Louisville on 11 January, 1796, several of the members were threatened and challenged to duels unless they stopped trying to overturn the sale. Amazingly, they all forged ahead.  These people land speculators were greedy as hell.

First things first; the assembly elected the logical Jared Irwin (above) as the new Governor, a good balance to the emotional Representative Jackson. Then a special committee was created – chaired by Jackson – to take testimony on the great Yazoo Yard Sale, er, land sale.

And it was here, under oath, that the whole sordid tale came out. Jackson's final report seethed with indignation. “The public good was placed entirely out of view, and private interest alone consulted;...the rights of the present generation were violated, and the rights of posterity bartered... and the principles of aristocracy established in their stead.”  Now that is what a class war warrior really sounds like.

The Legislature offered up what became the “Rescinding Act”, which spent a thousand words justifying itself.  And then it declared the Yazoo land sales null and void. The buyers could have their money back (initial payments had been made). But Jackson insisted on going a step further. The act gave the government 3 days to expunge any reference to the sale in public records. Any county officer or court clerk found with a reference to the Yazoo sale on their books, even in an index, was to be fined $1,000 a day until the offending passage was removed. 

It was made illegal for courts to accept any lawsuits mentioning the Yazoo Land sale. Georgia would not even respond to any future Federal lawsuits involving the sale. The Rescinding Act was Orwellian two centuries before George Orwell. The entire Georgia legislature of 1795 had all become “un-persons”.

On 13 February, 1796 both houses of the Georgia state legislature approved the Rescinding Act, by 43 to 3 in the house and in the Senate by 14 to 4. That same day Governor Irwin signed it. Immediately the state house swarmed with men wielding scissors, slicing out all references to the  Yazoo sale from books. newspapers, calendars and advertisements. 

The Act also ordered that three days hence, “A fire shall be made in front of the State House door, and a line to be formed by the members of both branches around the same. The Secretary of State... shall....then produce the ... usurped act... and deliver the same to... the... Messenger of the House, who shall then pronounce “God save the state! And long preserve her rights! And may every attempt to injure them perish as these corrupt acts do now!” And at about four on the afternoon of 15 February, 1796, that is exactly what happened. They actually burned copies of the bill.

The local papers published romanticized accounts of the bonfire.  In the Chronicle it was noted that a magnifying lens had been used to start the fire. Thus, wrote the reporter, “God Almighty is at last brought into the scrape.”  But a Charleston, South Carolina newspaper also observed that the blaze was of  “very little to the satisfaction of the bystanders.” 

It wasn't that they didn't approve of the conflagration, but they had a new worry - the entire world's economy had just dropped into the toilet. And the man who had dropped it there was the Philadelphia speculator, James Greenleaf.

Okay, maybe it wasn't entirely James Greenleaf's fault.  But this silver tonged liar does seem to have been at the center of a lot of the distress in America. Mr. Greenleaf was the partner with Robert Morris (above), John Nicholson and James Gunn in the North America Land Bank. They were buying up as much land , including the Yazoo offerings, as possible to satisfy the anticipated demand from Dutch bankers, with whom young Greenleaf insisted he had intimate connections. 

Greenleaf had originally proven this a decade earlier, when in 1788, within  two weeks of his arrival in Holland, the then  22 year old American con man had met the Baroness Cornelia Elbertine Scholton van Ascht et Oud-Haarlem (above), and impregnated her.  Shortly there after, he not only left town, he fled the continent.

When she turned up pregnant, the reluctant Greenleaf was  convinced, probably with money, to return to Holland, where he wed the Baroness. It was Greenleaf's skill at seduction which convinced Secretary of State Thomas Jefferson to appoint Greenleaf as American envoy to Holland, meaning to their banks. (above). But eventually the Baroness realized her new husband was an amoral sleaze ball, and she attempted suicide. 

When Jefferson recalled Greenleaf, and he returned to the United States, the Baroness remained in Holland, with their son. The now 25 year old Greenleaf convinced a judge in Rhode Island he had been “tricked” into the marriage, and was granted a divorce. James Greenleaf was once again free, still handsome and young enough to be a seducer of women, and it turns out he could also seduce speculators like Morris, John Nicholson (above) and our old villain, James Gunn. Within minutes of the Yazoo land sale being approved by the Georgia assembly, James Greenleaf was bound back for Holland, to offer the wealthy Europeans a “safe” place to invest their money.  

Greenleaf arrived to find everybody in Europe investing their money in cannon and gun powder, as the French Revolution sparked fires all over the place.  The changed political situation, and his new reputation as sleaze encouraged most of his Dutch banking contacts  to give him the cold shoulder. Those willing to deal with him attracted no interest in buying shares in the  American Land Bank,  Defeated, James Greenleaf returned home, deeply in debt. So now, holding worthless shares in four worthless Yazoo land companies, these four conspirators would have to look for their suckers some place else. So Greenleaf was dispatched to buy housing lots in the new Federal City of Washington, D.C.

The government was not supposed to move-in until 1800, but construction of the capital (above, BG) and the President's mansion had already begun. And of course eventually there would have to be buildings for a Post Office,  a State Department and a War Department. 

And after black slaves had built all of those, somebody would have build places for workers in those offices to buy groceries, restaurants to eat in, buy clothing, and 'entertainment' – everything from books to ladies of the evening. A city had to be established where there was no reason for it being, except politics insisted it be there.  And Morris and Nicholson and Gunn leveraged their almost worthless Yazoo shares into property in the new Federal City - Washington, District of Columbia..

At some point Robert Morris gave young James Greenleaf $7,000 in cash to pay for a section of city lots. But the money never made it to the seller. That drove Morris to take a closer look at the company books, where he discovered Greenleaf had signed all of his personal debts over to the  North American Land Company, making Morris and Nicholson and Gunn responsible for repaying them. The young seducer, had seduced 3 more victims. 

Disingenuously, Robert Morris (above) later wrote to Benjamin Harrison, claiming, “Twas he (Greenleaf) that encouraged the very extensive land purchases which were made under a promise that he would procure in Holland the money necessary to support the same...” Suddenly the financial Mozart of the Revolution was claiming the entire Yazoo Swamp-Land Fraud, the wholesale bribery of an entire state legislature, had actually been the dastardly plan of a  28 year old serial Casanova. 

It was ridiculous, but I suppose such whining is a natural reaction when a “master of the universe” gets the shaft - it must be somebody else's petard, never their own that they are hoisted upon.  Blame it on the government regulators, or the greed of a business partner. It is never their greed that is blame for mistakes they make.

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GEORGIA PEACHES Chapter Eight

 

I think Patrick Henry's death may have been a release. At the urging of George Washington, in the spring of 1799, Patrick stood for one last election - for the Virginia House of Delegates. He ran as a Federalist, which may seem an odd for a man who had  opposed the new Federal Constitution, and Hamilton's Bank of the United States.  Patrick won his last election, but never occupied his seat. He died of stomach cancer on 6 June, 1799. His second wife, Dorothea, quickly married Patrick's friend, Judge Edmund Wilson, thus protecting the family investments from predators who might have cheated a naive widow, probably a predator like  Senator James Gunn..

Once the details of the Yazoo Land sale became public, Senator Gunn was almost universally despised. But six years later he was still a United States Senator. Toward the end of his term he announced he was “disgusted with everything connected with public life” - it was certainly disgusted with him.  In March of 1801 he returned to the old state capital of Louisville, Georgia and at the end of July 1801, in a room full of people, James Gunn died so quietly no one noticed he was dead for several minutes. That would have galled him. One obituary called him “General Yazoo”, a reminder of those runaway slaves he had murdered so many years before, and the millions he had tried to steal from the  tax payers.  A kinder obituary hoped he was “beyond the reach of friendship, or of hatred.”  Not me.

James Jackson was twice elected Governor of Georgia. In his first two year term he personally wrote sections 23 and 24 of the new Georgia constitution, which insured that " “no...order shall pass the General Assembly, granting a donation or gratuity in favor of any person whatever...” except by a two-thirds vote.  During his second term he finally disposed of the temptation of the Yazoo Lands by selling them to the Federal Government for $1,250,000. Georgia was no longer broke.

And when the “Prince of Duels” died on 19 March, 1806, no one was more surprised and disappointed than James Jackson, that he met his demise quietly in his own bed.

And so most of the speculators who tried to profit from the selling the Yazoo swamp  -  Patrick Henry, David Ross, Robert Morris, John Nicholson, James Wilson and James Gunn - most lost everything. Taking a profit would be up to the next generation of “land jobbers”, starting with John Peck, and his partner in “ legal crime”, Robert Fletcher.

The story goes - and it was a fictional story - that on 14 May, 1803, 75 year old John Peck sold to 43 year old Robert Fletcher 15,000 acres of Yazoo land around the Tombigby River, in exchange for $3,000, or about 4 and 1/3 cents an acre.  Fletcher was concerned about receiving a clear title because of the "The Rescinding Act”,  so Peck had included the following addendum, insisting that,  “The title to the premises as conveyed by the state of Georgia (in 1795)...has been in no way constitutionally or legally impaired by virtue of any subsequent act of any subsequent legislature of the...state of Georgia.”

The addendum was important because of the 1603 English case of Chandler v Lopus, which you remember (I'm sure)  established the legal doctrine of Caveat Emptor.  Peck had now provided the guarantee in writing that the 1796 Rescinding Act did not apply, even though Georgia had just sold the Yazoo Swamp-Land to the Federal Government. And in doing so, he had provided legal grounds for Fletcher to sue Peck to get his money back. But then that was not really the point of the entire transaction.

Because Fletcher was a resident of New Hampshire and Peck resided in Massachusetts, the case moved directly into the federal court system – what a lucky break that was. There  it was heard at the circuit court level by the cranky, craggy 74 year old New Englander, William Cushin , who was also a Supreme – another lucky break. Cushin  decided the case for Peck, which allowed Fletcher to appeal to the Supreme Court.

And it is now that the final character in our farce, John Marshal, steps upon the stage. He was a cousin to Thomas Jefferson, and a close friend to George Washington. When the case of Fletcher v Peck reached the high court in March of 1806, Chief Justice Marshall decided that the arguments made by Peck's team of lawyers had been “incorrect”, and so the case was “continued by consent”,  meaning held over for the next term, to be re-argued in October of 1807.  And even then, Marshall did not issue the final ruling until 16 March, 1810, 3 years later, probably because it took him that long to build a unanimous decision. The decision had to be unanimous because for the first time ever, the Supreme Court was declaring that a state law - the Rescinding Act -  violated an article of the Federal Constitution – in this case, section 10 of Article One.

As usual, Marshall wrote the court's opinion. He acknowledged that the members of the 1795 Georgia legislature were guilty of reprehensible actions. However, he reasoned, “The grant, when issued, conveyed an estate...(and) This estate was transferable; and those who purchased parts of it were not stained by that guilt which infected the original transaction.” Thus was born the legal fiction of the “innocent third party” in the Yazoo land fraud, meaning the speculators who had bought the land from the men who had bribed the legislature were to be considered innocent  As if they had not often been the same men working under the mask of a corporation.

Marshall argued that if a concealed defect in a contract could be held against the victim of that concealment, then “All titles would be insecure”. That might be true in the abstract, but referring to the members of the New England Mississippi Company as “innocent” was almost as much a legal fiction as insisting that written guarantees protected buyers in an age when only 3% of the population could read.

Oddly, the only member of the court to disagree with Marshall in writing was Jefferson's only appointee on the court,  William Johnson, from South Carolina. And his only objection was that he thought the Indians had a better claim to the land than did the state of Georgia. Still, Johnson managed, at the end of his argument, to state the obvious. “I have been very unwilling to proceed to the decision of this cause at all,” he wrote, because, “It appears to me to bear strong evidence... of being a mere feigned case.” But having stated that, Johnson then folded his tent and concurred with Marshall's decision. And so the court had decided in favor of the New England Mississippi Company and all the other speculators in the Yazoo land sales.

The cost of that decision became clear in 1814, when the Federal government reached a settlement with all the “innocent third parties” in the Yazoo land fraud. Having already paid Georgia $4 million in 1802  for the land -  the modern equivalent of $63 million -  they now paid the speculators in the various Yazoo companies another $5 million for the same land - the modern equivalent of $50 million.

It made Patrick Henry's scheme to cheat the tax payers of Georgia seem small potatoes. And this would be far from the last time the lawyers wrote and interpreted laws to assist thieves in robbing the public. Such behavior is a stab to the heart of the public's faith in their government. And it all began at the very birth of our Republic.

It was the next generation of Americans who would risk their fortunes to build dams and levees, to drain the Yazoo swamp and keep the river to a path, and who would finally lay bare some of the richest agricultural soil in the world, upon which they would plant and grow cotton. There were profits aplenty for all...except, of course, for the natives who had originally owned the land and the slaves who picked the cotton. It is a sad truth about speculators that like villains in a horror story they generate life for no one but themselves, and misery and debt for everyone and everything else they touch.  And capitalism empowers them.

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