Statehood was within sight when Gov. William Wyatt Bibb submitted his address to the first Alabama Legislature in October 1819. He likened the process to building a house. Congress laid the foundation in 1817 when it created the Alabama Territory from the easternmost portions of Mississippi. In the summer of 1819, the elected delegates who wrote Alabama’s constitution provided residents with the framework, beneath which the new state would surely prosper. “To the legislature is confided the arduous task of completing the edifice,” Bibb wrote, confident the lawmakers could meet the historic moment. “Never has any state commenced its operations under more auspicious circumstances or furnished stronger evidence in the outset of its capacity for self-government.”
Politicians often prefer poetry over cold prose. So it was with Alabama’s first governor, whose aspirational words masked a rather unfirm financial foundation. Although these difficulties were mostly beyond the control of Bibb and the legislators assembled in Huntsville in 1819, they loomed large as Alabama concluded its path to statehood.
Bibb promised lawmakers the finances of the burgeoning state would “be laid before you by the proper officer” in short order. That officer was 28-year-old Samuel Pickens, Alabama’s first comptroller of public accounts. Born in North Carolina in 1791 and educated in finance and the law, Pickens moved to the Alabama Territory in 1817 with two of his brothers. The task assigned to him was an important one. The fastidious comptroller was responsible for auditing all disbursements and receipts and assessing the financial health of the treasury.
The prospects were not good, Pickens found. Additional revenue was needed to pay Alabama’s debts. Near the end of the session, the legislature passed a resolution authorizing Bibb to seek funds “for the use and benefit of the State of Alabama” to bridge the shortfall. The loan could not exceed $20,000 and was to come from one of the private banks then fully operating within Alabama. (The upstart Bank of Mobile was excluded.) Bibb signed the resolution into law on December 13, 1819.
The following day, Pickens presented the governor a simple, one-page budget report to aid his endeavor. On the same day in Washington, President James Monroe signed the enabling legislation granting Alabama statehood. Unbeknownst to Pickens, his brief memo served as a snapshot of Alabama’s financial health at the very moment it entered the Union as the twenty-second state. Pickens calculated that Alabama’s coffers held the goodly sum of $22,411.54. But expenditures outpaced the revenue at $32,441, leaving Alabama nearly $10,000 in the red. The report reveals that Alabama’s early debts were not the result of extravagant spending but rather from the necessary functions of government: $400 in wages for the legislature’s door keepers; $1,200 for the secretaries and clerks of the House and Senate; $4,331 in first-quarter salaries for constitutional officers; $1,500 to the state printer; and nearly $25,000 in wages and per diem expenses owed to legislators.
The bankers were in an unenviable position when the governor came to call. Alabama’s political development occurred in concert with a calamitous global financial crisis known as the Panic of 1819. Years of double-fisted speculation and overextended credit fed a land bubble that was built upon an assumption that commodity prices, particularly cotton, would remain stable. But American cotton prices fell by 50% in 1819 because of overproduction and foreign competition. Falling prices meant many farmers could not pay their debts. This in turn deprived banks of the gold or silver payments needed to back up the unregulated paper banknotes, which many institutions printed with unbridled abandon. Already operating on thin margins, Alabama’s banks had little to spare for the state.
Bibb first approached the Tombeckbe Bank in the southern town of St. Stephens. Chartered by the territorial legislature in February 1818, the bank was initially under the care of Israel Pickens, the older brother of the comptroller. With an eye toward political office, the elder Pickens had left the affairs of the bank to William Crawford. It fell to Crawford to inform the governor that Tombeckbe’s board voted to deny his loan request.
Rebuffed in St. Stephens, Bibb turned his efforts to Huntsville’s Planters and Merchants Bank, which began operations in October 1817. LeRoy Pope, it’s influential founder, ranked among the largest landowners in north Alabama and wielded significant behind-the-scenes political power. The banker and chief executive had a complex relationship. As territorial governor, Bibb vetoed a bill granting Pope’s bank permission to expand. But in October 1819, the governor acceded to the deposit of a large sum of state funds in the Huntsville bank. In the spring of 1820, Pope agreed to a loan of $10,000, enough to pay the state’s debts.
Though he secured Alabama’s immediate financial future, William Wyatt Bibb did not live to see his broader hopes for the state fulfilled. He died at his Autauga County home in July 1820, succumbing to the combined effects of tuberculosis and a horse-riding accident. The man who succeeded him as governor was the president of the state senate, his younger brother Thomas Bibb, who in his first address to the legislature reported on his late brother’s success. In November 1821, Thomas Bibb negotiated a one-year loan extension with Pope.
Alabama’s third governor, erstwhile banker Israel Pickens, oversaw the repayment of the $10,000 loan. In November 1822, he secured additional funds from the Huntsville institution in the amount of $4,500 and expressed his own hopes for the future of the young state “emerging from financial embarrassment.” Still, the effects of the Panic of 1819 were not quickly overcome in Alabama. The state’s finances remained precarious throughout the 1820s. Both the Planters and Merchants and Tombeckbe banks failed during the decade.
Dutiful Samuel Pickens served as comptroller under Alabama’s first four governors. In retirement, he established a large Hale County plantation named Umbria and oversaw construction of a stately Greek-Revival mansion on the property, which stood until the 1970s. He died in 1855.
