The fact that there were practicing corporate lawyers in Walla Walla in the mid to late 1800s indicates the business boom in the region vis-a-vis urbanization. According to Eugene P. Moehring, in his article "The Civil War and Town Founding in the Intermountain West," the Civil War period saw expanded town formation in a beltway from Arizona to central Washington. Settlers from East of the Mississippi River moved to the West, some fought in the Indian wars, mined for gold, and settled into towns. They all seemed to have a common purpose in wanting to make money and this made Walla Walla a burgeoning trading town. According to historian Alexander C. McGregor, even Kootenay County began relying on the growing trading hub to the south. The Mullan Road was a key route for the transport of gold from mines in Montana and Idaho, because it was the major road that passed through the mining areas. As the terminus town on the Mullan Road, Walla Walla grew as a holding area for metals as they were transported to Wallula and along the Columbia River. [2]
Because the Civil War accelerated white migration to the far West, urban settlement increased exponentially. Walla Walla is one example of urbanization on former "Indian lands. This resulted in the formation of numerous communities, linked together by roads and commercial relationships into urban networks." [3] Walla Walla's growing businesses in the 1860s created demand for corporate (or business) lawyers, not least because of credit defaults.
Despite the population boom in Washington and the West in general, the underlying economic situation was weak because of the Civil War. The war depressed the consumer goods economy while simultaneously increasing the "feverish, wartime speculation in precious metals." [4] The war materiel business was doing well, but Walla Walla was far away from Civil War battlefronts. The town was not a notable producer of war materiel. Armies did not produce goods; therefore, war has historically been known to cause inflation because of the disruption to the civilian market economy. The Kondratieff Wave theory has shown that although the economy expanded in the West, including Walla Walla, it contracted east of the Mississippi River. Four large inflationary spikes since the early 1800s to 2000 all occurred during wartime. People migrated to where they could most likely profit. One of the "troughs" during the "second long wave" occurred during (or because of) the American Civil War. [5]
The "trough" appeared less dire in the West than in the East. Many people became de facto entrepreneurs and moved to where they could start anew. But money was scarce, so credit took the place of the cash-in-hand system. Carville Earle notes in The American Way that "entrepreneurs vastly extended the tissue of credit in ways that provided market access to ceramics, household fineries, and tropical exotica in the one case, and to electrified durables in the other." [6] As seen in cases such as Way, Bush & Co. vs. Smith & Crapper and J. R. Scranton (1862), credit was unstable. Companies could barely rely on each other to pay their debts as agreed because of the tumultuous Civil War recession. The value of money was based on what Bruce Carruthers and Sarah Babb call the "taken-for-granted" system. The government declared paper to be of a certain value vis-a-vis gold bullion. However, the credit system was based even more on the taken-for-granted mentality because credit was the absence of tangible money. The value of credit relied on the debtor's promise to pay for goods received. [7] H. S. Jacobs vs. Mullan Brothers was another civil collections case that exemplified these "promissory" note defaults. Having failed to pay, Mullan Brothers Company was sued by their creditor, H. S. Jacobs. Goods were given with the understanding that payment would eventually be received. Without the credit system, Walla Walla (and the West in general) would not have expanded economically as much as it did.
Notes
[1] Lyman's History of Old Walla Walla County: Embracing Walla Walla, Columbia, Garfield and Asotin Counties, vol. II (Chicago, IL: The S. J. Clarke Publishing Company, 1918), 20-21.
[3] Eugene P. Moehring, "The Civil War and Town Founding in the Intermountain West," The Western Historical Quarterly 28, no. 3 (Autumn 1997), 319-20.
[4] Moehring, 320.
[5] Carville Earle, The American Way: A Geographical History of Crisis and Recovery (Rowman & Littlefield, 2003), 29; Brian Joseph McCormick, The World Economy: Patterns of Growth and Change (Rowman & Littlefield, 1988), 20-22; John J. Murphy, Intermarket Analysis: Profiting from Global Market Relationships (John Wiley and Sons, 2004), 195.
[6] Earle, 29.
[7] Bruce G. Carruthers and Sarah Babb, "The Color of Money and the Nature of Value: Greenbacks and Gold in Postbellum America," American Journal of Sociology 101, no. 6 (May 1996), 1557.
Despite the population boom in Washington and the West in general, the underlying economic situation was weak because of the Civil War. The war depressed the consumer goods economy while simultaneously increasing the "feverish, wartime speculation in precious metals." [4] The war materiel business was doing well, but Walla Walla was far away from Civil War battlefronts. The town was not a notable producer of war materiel. Armies did not produce goods; therefore, war has historically been known to cause inflation because of the disruption to the civilian market economy. The Kondratieff Wave theory has shown that although the economy expanded in the West, including Walla Walla, it contracted east of the Mississippi River. Four large inflationary spikes since the early 1800s to 2000 all occurred during wartime. People migrated to where they could most likely profit. One of the "troughs" during the "second long wave" occurred during (or because of) the American Civil War. [5]
The "trough" appeared less dire in the West than in the East. Many people became de facto entrepreneurs and moved to where they could start anew. But money was scarce, so credit took the place of the cash-in-hand system. Carville Earle notes in The American Way that "entrepreneurs vastly extended the tissue of credit in ways that provided market access to ceramics, household fineries, and tropical exotica in the one case, and to electrified durables in the other." [6] As seen in cases such as Way, Bush & Co. vs. Smith & Crapper and J. R. Scranton (1862), credit was unstable. Companies could barely rely on each other to pay their debts as agreed because of the tumultuous Civil War recession. The value of money was based on what Bruce Carruthers and Sarah Babb call the "taken-for-granted" system. The government declared paper to be of a certain value vis-a-vis gold bullion. However, the credit system was based even more on the taken-for-granted mentality because credit was the absence of tangible money. The value of credit relied on the debtor's promise to pay for goods received. [7] H. S. Jacobs vs. Mullan Brothers was another civil collections case that exemplified these "promissory" note defaults. Having failed to pay, Mullan Brothers Company was sued by their creditor, H. S. Jacobs. Goods were given with the understanding that payment would eventually be received. Without the credit system, Walla Walla (and the West in general) would not have expanded economically as much as it did.
These civil court cases are representative of the collections cases of the early 1860s. The territorial economy functioned on credit during the Civil War and beyond. The Court settled legal proceedings within a couple of years, generally. Awards amounted to the hundreds of dollars. Collections cases occurred because of a large, yet tenuously regulated, economy.
Notes
[1] Lyman's History of Old Walla Walla County: Embracing Walla Walla, Columbia, Garfield and Asotin Counties, vol. II (Chicago, IL: The S. J. Clarke Publishing Company, 1918), 20-21.
[2] Alexander C. McGregor, "The Economic Impact of the Mullan Road on Walla Walla, 1860-1883," Pacific Northwest Quarterly 65, no. 3 (July 1974), 121.
[3] Eugene P. Moehring, "The Civil War and Town Founding in the Intermountain West," The Western Historical Quarterly 28, no. 3 (Autumn 1997), 319-20.
[4] Moehring, 320.
[5] Carville Earle, The American Way: A Geographical History of Crisis and Recovery (Rowman & Littlefield, 2003), 29; Brian Joseph McCormick, The World Economy: Patterns of Growth and Change (Rowman & Littlefield, 1988), 20-22; John J. Murphy, Intermarket Analysis: Profiting from Global Market Relationships (John Wiley and Sons, 2004), 195.
[6] Earle, 29.
[7] Bruce G. Carruthers and Sarah Babb, "The Color of Money and the Nature of Value: Greenbacks and Gold in Postbellum America," American Journal of Sociology 101, no. 6 (May 1996), 1557.
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