"The public lands are a public stock, which ought to be disposed of to the best advantage for the nation"
This quote is often, used by environmentalists in support of protecting public lands, but in many of these cases it is taken out of context. The argument, they make is that President Monroe was against the use of public lands by private industry, but this is not the argument that Monroe was making. Rather, Monroe was writing about land speculators who were taking advantage of government land sales. Monroe wanted to sell the land to private individuals with the Federal government profiting off of the increased value, not land speculators.
Under President Thomas Jefferson, Congress passed he Land Act of 1804, superseding the Harrison Land Act of 1800. Both the act of 1800 and that of 1804, were passed to make migration to the western United States more attractive. The Harrison Act defined the minimum amount of land that could be purchased at 640 acres, while the 1804 act permitted the government to auction the land on credit with a standard 25% down payment and 6% interest. Much of the land available was in the Mississippi territory and was very well suited to growing cotton, much more fertile than the over-farmed lands of South Carolina. But in the immediate years after the land act of 1804, the market for English textiles and American cotton was depressed due to the trade embargoes enacted by the British and French. When Jefferson, responded with the Embargo Act of 1807, dealing a death blow to the industrial New England, it left the South with even less demand for their cotton, and kept the prices of land in the Mississippi territory low.
Despite, the low demand for Cotton and Indian hostilities in the area, settlers and speculators purchased over 77,000 acres of land in 1810. In 1809, President Madison had ordered land sales in what was to become the state of Alabama, and Americans living in crowded eastern states were drawn to the fertile lands and freedoms of the open territory. But soon, many more would follow them due to two major events. First, during the war of 1812, as a result of the Battle of Horsehoe Bend, the Creek tribes were signed the Treaty of Fort Jackson and ceded 23 million acres of their territory in Alabama and Georgia to the United States Government. Second, in 1815 with the final defeat of Napoleon and the collapse of the France's Continental blockade the demand for English textiles exploded, driving imports of Cotton into Europe causing it's prices to climb from 20 cents per pound in 1815 to 30 cents in 1817. As cotton prices rose, so did the demand for these fertile lands including the newly acquired 23 million acres, driving prices up. In Madison County, Alabama the prices increased from $2 per acre in 1817 to $7.40 per acre by 1818, with reports for some acres going for as high as $78. With rising prices, came land speculators. These were wealthy capitalists who were buying large tracts of land at low prices in expectation that the prices would rise.
In late 1817, President James Monroe was well aware of the land speculation, and he wanted to make it clear to Congress, that it was the nation and the public, not land speculators that ought to be benefiting from the increase in land value. In his first State of the Union address, Madison asked Congress to consider what new provisions could be made to the land acts of 1800 and 1804 to ensure that the land was used for emigration and that profits were returned to the public. Monroe began by reminding Congress that the nation had admitted into the Union several new states for which there was much vacant land soon, and demand for this land would likely increase with the termination of Indian hostilities. Monroe wrote that "the public lands are a public stock, which ought to be disposed of to the best advantage for the nation" and "the nation should therefore derive the profit proceeding from the continual rise in their value". Monroe explained that settlers or "emigrants" should be encouraged to compete and purchase the the land at a fair price, but that that the main objective should be to maximize the profit of the nation over the individual. While, there is no real way to stop wealthy capitalists from benefiting under any mode of sale, he warned against allowing forward looking speculators who might amass "vast bodies" of lands at low prices. Aside from taking profit, which should be left to the public, these speculators would also have the power to "control the emigration and settlement in such a manner as their opinion of their respective interests might dictate". And with this, Monroe asked Congress consider "such further provision may be made in the sale of the public lands, with a view to the public interest".
"A considerable and rapid augmentation in the value of all the public lands, proceeding from these and other obvious cases, may henceforward be expected. The difficulties attending early emigrations will be dissipated even in the most remote parts. Several new States have been admitted into our Union to the west and south, and Territorial governments, happily organized, established over every other portion in which there is vacant land for sale. In terminating Indian hostilities, as must soon be done, in a formidable shape at least, the emigration, which has heretofore been great, will probably increase, and the demand for land and the augmentation in its value be in like proportion.
The great increase of our population throughout the Union will alone produce an important effect, and in no quarter will it be so sensibly felt as in those in contemplation, which ought to be disposed of to the best advantage for the nation. The nation should therefore derive the profit proceeding from the continual rise in their value. Every encouragement should be given to the emigrants consistent with a fair competition between them, but that competition should operate in the first sale to the advantage of the nation rather than of individuals.
Great capitalists will derive the benefit incident to their superior wealth under any mode of sale which may be adopted, but if, looking forward to the rise in the value of the public lands, they should have the opportunity of amassing at a low price vast bodies in their hands, the profit will accrue to them and not to the public. They would also have the power in that degree to control the emigration and settlement in such a manner as their opinion of their respective interests might dictate. I submit this subject to the consideration of Congress, that such further provision may be made in the sale of the public lands, with a view to the public interest, should any be deemed expedient, as in their judgment may be best adapted to the object."
Congress did not take immediate action, and unfortunately due to efforts to tighten monetary policies of the Second Bank of the United States, many of the loans to buy the land were called in and property prices fell contributing to the Panic of 1819. By 1820, Alabama land buyers collectively owed $21 million dollars to the federal government. In response, Congress passed the Land Act of 1820, ending the ability to purchase United States public lands on credit or installment. In addition, the Land Act also reduced the minimum price from $2 per acre to $1.25 per acre. The Land Act of 1820 did help to curb land speculation, and was good for the average American, but as Monroe predicted it did nothing to stop wealthy capitalists from benefiting from the new lower prices. The new act, also increased the confiscation of land from the Indian tribes.
http://www.presidency.ucsb.edu/ws/index.php?pid=29459
https://en.wikipedia.org/wiki/Land_Act_of_1804
https://en.wikipedia.org/wiki/Alabama_real_estate_bubble_of_the_1810s
http://www.alabamaheritage.com/creek-war-era/winter-1811-land-speculation-in-huntsville
http://www.stateoftheunionhistory.com/2016/11/1814-james-madison-treaty-of-fort.html
https://en.wikipedia.org/wiki/Land_Act_of_1820
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