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After the War of 1812, Americans realized they needed a bank due to their financial struggles. This led Congress to recharter the national bank in 1816. -
Jackson disagreed with the National Bank heavily. When Congress decided to recharter the bank early and sent the bill to Jackson, he sent it back unsigned, with a note saying that he was vetoing the bill as he found it unconstitutional. -
In an attempt to weaken the bank further, Jackson withdrew all deposits from the national bank and put them in state banks. -
Nicholas Biddle was the president of the national bank. In an attempt to drive the public against Jackson and recharter the bank, he reduced loans and called in any debts. -
The Whig Party is formed after the election of 1832 to support the national bank.
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Jackson issued an order stating that the federal government would only take currency in the form of gold or silver to purchase land. This was bad on the working class, as state banks did not have enough hard currency to exchange for bills, which led to an economic crash. -
While this economic crash may not have been directly caused by Jackson, his actions definitely contributed to it. Without the national bank, private banks could expand themselves, which led to rapid inflation. His policies for hard currency led to the shut down of private banks. This, along with a drop in the price of cotton and an increase in interest rates in Britain, led to the Panic of 1837. -
Jackson’s successor, Martin Van Buren, proposed the independent treasury system, which kept federal funds out of banks. This was repealed after he lost the election against William Henry Harrison in 1840.