William Duer Almost Bankrupts America
William Duer was a signer of the Articles of Confederation whose desire to make money sank two businesses, caused the Panic of 1792 and almost destroyed the American economy in its infancy.
Published 1/12/19 - Updated 10/24/21
William Duer
Born in England, William Duer joined the British Army as a young man and traveled as far as India while performing his duties.
Upon his father’s death, William sailed for the New World to care for the family’s property there. After becoming close to Philip Schuyler, Duer settled in New York.
William began speculating in land and quickly became extremely wealthy.
Politics
Although he was original lukewarm to the idea of rebellion, Duer was selected for the New York Provincial Assembly just as hostilities began. After helping to write New York’s first constitution, he became an inaugural member of the State Senate.
William was soon chosen as a Delegate to the Continental Congress, serving on the committees which would later evolve into the Treasury and War Departments.
While in Philadelphia, Duer signed the Articles of Confederation.
Finance
William left the Continental Congress in 1779 to return to private enterprise and married Catherine Alexander, making him son-in-law to Major General William Alexander, Lord Sterling.
Duer added to his massive wealth by contracting with Congress to supply the Continental Army. This was not out of the ordinary at the time, and many leaders of the Revolution profited from the war in this fashion.
William was a supporter of the Constitution and wrote in its defense during the Ratification Debates.
He was chosen as the first United States Assistant Secretary of the Treasury, number two for Alexander Hamilton. In this position, William helped create the original fiscal policies of the United States.
The Scioto Land Company
By 1792, Duer had begun to get greedy.
Always seeking more and more wealth, he created the Scioto Land Company. This company was organized with the intention of selling lands in the Ohio Territory to Europeans who wished to come to American to start a new life.
This land was sold by his agents in England and France, and over five hundred French people sailed to the United States.
There was just one problem: Duer had never actually gained ownership of this property.
The Scioto Company failed spectacularly, hurting William’s finances and, worse, leaving the people stranded without a home (though President Washington would step in and help them find residence).
The Panic of 1792
Undeterred, William Duer attempted to create a bank and put the Bank of New York out of business.
Duer attempted to corner the securities market (securities being necessary for investment in the Bank of the United States) and therefore give him complete control of the ability of New Yorkers to buy stocks in the young American Government. (Please note: this is an extraordinary oversimplification of an extremely complicated financial situation.)
William’s speculation was the major reason for the Panic of 1792. This Panic would have lead to an economic depression if it were not for certain swift, back channel maneuverings on the part of Alexander Hamilton.
Though the country was saved, Duer’s finances were not. He was financially ruined and was sent to debtor’s prison. William died in prison seven years later.
To learn about other early members of the Treasury Department, click on these articles about Tench Coxe and Robert Morris.
To read a more full account of William Duer’s life, pick up a copy of ‘King of the Alley’ through the Amazon affiliate link below.
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