Friday, March 21, 2014

Meanwhile, back in Baltimore...

In the good old days of the nineteenth century, every time a failed revolutionary faced a firing squad in Mexico City, back in Baltimore there were people crying. No, they were not his family. They were the investors who financed his unsuccessful coup.

Francisco Xavier Mina, Spanish soldier, Mexican revolutionary
from the Wikimedia Commons: public Domain, Artist Unknown
Sometimes, years later, when a grateful independent Mexico decided to repay the debt it owed to the American investors and to people who had since gone bankrupt due to lack of payment or who had died of old age, their creditors or their heirs were denied payment, because of the Neutrality Act. This is what happened when Xavier Mina left his base in Galveston on an ill-fated mission to liberate Mexico from its Spanish oppressors in 1817.

Mina was a loyal Spanish subject born in Otao, Navarre, and  he acquired experience in guerilla warfare against the French occupation force in 1808. From an initial guerilla force of only ten men, under Mina's leadership his followers grew to 1,200 infantry and 150 cavalry. He made inroads into the French occupation but was captured in 1810 and sent to prison in France and was released n 1814. By then King Ferdinand VII of Spain was on the throne again, and Napoleon was exiled in Elba. King Ferndinand made Mina a Colonel in his army. But Mina was not happy with King Ferdinand. Why? Because the King had abolished the democratic constitution of 1812.

And so, the idealist Mina, who had fought so hard for the restoration of his King under the French oppressor now decided he wanted to liberate Mexico from Spain. Some English lords financed his voyage to Baltimore.

...there  [Mina]   entered into a contract with certain gentlemen of that place, who associated themselves under the name of the "Baltimore Mexican Company," for the purchase of a quantity of arms, ammunition &c., to fit out an expedition against the then government of Mexico. On account of the risk attending their delivery and the uncertainty of the payment, it was agreed that Mina should pay one hundred percent on the cost of the articles, and interest. The goods were shipped for Mexico and delivered according to contract, but were not paid for by General Mina, as he was soon after taken prisoner and shot. Gill v. Oliver's Executors, 52 U.S. 529 (1850)

That's right. Mina was taken before a firing squad and summarily shot. He was twenty-seven years old at the time of his death. It was November 11, 1817. But that's just the beginning of the story. The good men do is buried with them, but their debts live on forever, or at least until they are paid or discharged in bankruptcy.

Back in Baltimore, the investors who outfitted the expedition were crushed. One of them, Lyde Goodman, filed for discharge in bankruptcy, and he transferred all his right and title to a share in the Baltimore Mexican Company to the trustee in the bankruptcy proceeding. The trustee, a certain Mr. Brown, then transferred all his right to that share to Robert Oliver in 1825. By this time Mina had been moldering in his grave for eight years, his debts to the Baltimore investors still unpaid.

Then one day a grateful Mexican Nation decided to repay its debts. Spain had finally been driven out.

In 1825, Mexico had achieved her independence, and after much solicitation the government was persuaded to acknowledge the justice of this claim, and assume the payment of it by an act of Congress passed to pay the debts of Mina. But notwithstanding the recognition of this claim as a debt, its payment was delayed for many years, and seemed almost hopeless.Gill v. Oliver's Executors, 52 U.S. 529 (1850)

Finally, in 1839 the money became available, but there was now a dispute as to which of two trustees in bankruptcy of Lyde Goodman was entitled to collect. Did this claim to money from the government of Mexico exist as far back as 1816, when the expedition was outfitted in contravention of the Neutraility Act? Or did it only arise in 1825 when the government of Mexico decided to honor the promises that Mina had made back in 1816 when passing through Baltimore?

Was the void and illegal contract with Mina, made in 1816, such a chose in action as would pass by such insolvent law in 1817? Or did it first become an assignable claim after it was acknowledged by Mexico in 1825, and, as a new acquisition of Lyde Goodwin after his insolvency, pass by his assignment to Oliver. Gill v. Oliver's Executors, 52 U.S. 529 (1850)

Well, the Supreme Court took the easy way out. They decided they had no jurisdiction over the matter. They dismissed the case. So why am I telling you this story? Because it's something to think about if you are a supporter of the Neutrality Act.

Should American investors help revolutionaries in other countries to overthrow their government? If you said "No, that should be illegal", think about this: if only the government of the United States has the right to overthrow foreign governments, then only the friends of the President and other powerful politicians will be allowed to profit from investing in war. Do we really want crony capitalism to allow only certain people  to become war profiteers? Do we want to give the government a monopoly on military contracts?

The Neutrality Act does not prevent war. It does not prevent investors from gambling on war. It does not prevent politicians from profiting from war. All it does is hand a monopoly to people in the government. So now if we bet on the wrong horse, all of us have to pay for our mistake and not just a few unlucky investors in Baltimore.


  1. Interesting to read your thoughts on this issue. I guess this will foreshadow a bit more what the next book is going to be about.

    1. Thanks, Julia. This is more background information than actually what the second half of Theodosia and the Pirates is about. Xavier Mina does figure in the story very briefly, as he and Jean Laffite had some dealings in Galveston before Mina set off to liberate Mexico and was captured and shot. But it is also important to understand the economic ramifications of the Mina expedition to ordinary American investors.

      1816 was a bad year for crops, as there was no summer. It was a bad year to invest in Mexican revolutionaries. Is it any wonder that the Panic of 1819 soon followed? People say it was due to the banks not being regulated. But I think it was just part of the natural fluctuations in the economy that follow natural fluctuations in the weather. Not all problems are man made. Even those that are can best be solved by letting things work themselves out.