Moments of Despair: Suicide, Divorce, and Debt in Civil War Era North Carolina

7. Sacredness of Obligations: Debt in Antebellum North Carolina

Chapter seven Sacredness of Obligations Debt in Antebellum North Carolina A lthough debt of one form or another was ubiquitous throughout the South during the nineteenth century, indebtedness carried a significant social stigma for white North Carolinians during the antebellum period. Debt functioned as a fundamental threat to an individual ’s independence because it made the debtor assume a subordinate position to his or her creditor. Antebellum white southerners recoiled at the idea of dependence because they associated it with slavery. One of the distinguishing features of slaves, thought white southerners, was their subordination to and dependence upon their master. Therefore, to enter into debt was to assume the position of a slave. While the metaphor comparing indebtedness to slavery was common throughout the United States during the nineteenth century, the symbol of the debt slave was particularly palpable in the context of a slave society.1 As a result, most antebellum white North Carolinians sought to avoid indebtedness at all costs. At the same time, a desire for upward mobility and social standing often compelled them to enter into debt. More than almost anything else, owning land and slaves demarcated social status in antebellum North Carolina .Tangible and visible, these forms of property offered antebellum white men access to the domain of mastery. To this end, they routinely violated the social prohibitions against debt in order to acquire these culturally and economically significant forms of property. Antebellum yeoman farmers often justified purchasing slaves on credit as a vehicle for social mobility. Indeed, buying slaves on credit was probably the greatest source of debt in antebellum North Carolina and across the South.2 White North Carolinians justified buying slaves on credit for four reasons. First, they could consider the purchase of slaves as a financial investment, as the price of slaves more credit and debt 142 than tripled between 1805 and 1860.3 Second, the productive labor of slaves in the fields meant that most slaves would pay for themselves in less than five years. Third, the reproductive labor of slaves meant that buying slaves functioned as a tool for upward mobility not only for a yeoman farmer but also for his sons and grandsons.4 Fourth, slave owners recognized that in times of financial trouble their human property was a very liquid form of capital. Unlike crops or real estate, whose liquidity depended upon fluctuations of geographic and seasonal demand, the market for slaves was relatively inelastic. Because slaves could be sold to settle otherdebts, slave owning functioned as a form of insurance against indebtedness. Furthermore, slaves could function as collateral to secure credit in the future. Indeed, one historian has concluded that slaves functioned as collateral in the majority of antebellum southern credit agreements. Therefore the structure of the southern slave society encouraged indebtedness, while at the same time attaching a heavy social stigma to debt.5 Antebellum white North Carolinians mediated the contradictoryaspects of debt through the development of what anthropologists call a gift economy . Blurring distinctions between market and interpersonal transactions, gift giving flourished in the antebellum white South because it functioned as needed credit without publicly making the recipient into a debtor.While these gifts existed in a myriad of forms, the type of gift that antebellum white southerners gave most often and desired most desperately was currency . By engaging in reciprocal gift giving, white North Carolinians created an informal credit system that simultaneously bound them horizontallyand vertically in the communityand served a necessaryeconomic role. This network of loans between white North Carolinians helped to create a system of mutual indebtedness that did not threaten to “enslave” its participants .6 Antebellum white North Carolinians did not, however, participate in this system indiscriminately. Instead, theyestablished a socially sanctioned, informal set of rules that dictated to whom they could loan money and in what amounts, rules that one historian has described as an “etiquette of debt.”7 Although these rules varied from community to community and their interpretation was often determined by individual idiosyncrasies, they broadly required that participants in debtor-creditor relationships recognize each other as social peers, though not necessarily equals. To be sure, individual reputation played a significant role when a creditor decided whether to provide a loan; however, because the possible social ramifications of refusing to loan money to a peer were so significant, most credi- Debt in Antebellum North Carolina 143 tors were willing to overlook an imperfect reputation except...