Jackson and the Bank

By marissal

  • Creation of the Second United States Bank

    It was renewed until 1816 because Madison didn't like the idea of a bank. This was charted in an effort to control the notes issued by state banks. The national bank could discipline private banks because they demanded payment in gold or silver. This was not supposed to expire until 1836.

  • Jacksons Veto

    Henry Clay and Daniel Webster, Jacksons' opponents in Congress, passed a bill that recharted the Second Bank of the United States. They wanted to force Jackson to take a clear pro-bank or anti-bank position. Jackson vetoed the bill and condemned the bank as a privileged "monopoly" created to make "rich men richer."

  • End to Deposits

    Jackson wanted to crush the central bank entirely so he ordered an end to deposits of government money in the bank. This also withdrew money that was already in its custody. This left an unregulated state banking system but it helped fuel westward expansion through cheap credit. However, this kept the nation vulnerable to periodic panics.

  • Panic of 1837

    This was a financial crisis in the United States which was influenced by the economic policies of President Jackson. Because the Second Bank of the United States was removed, private banks rapidly expanded the volume of banknotes in circulation. This contributed to the rapid increase in inflation. Jackson's Specie Circular of 1836 was supposed to curb inflation by requiring public land payments must be made in hard currency. This forced many Americans to exchange paper bills for gold and silver.

  • Formation of the Whig Party and Election of 1840

    The Whigs Party was formed in 1834 with National Republics, Anti-Masons, and Democrats that were all united by their hatred of President Jackson. The Whig party won the election because of William Henry Harrison. However, he died of pneumonia after only being in office for one month, John Tyler was his successor. John Tyler rejected the Whig legislative program that called for the re-establishment of the national bank, increased tariff, and federally funded internal improvements.