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result of jackson’s bank war

before its 20-year term ended in 1836. [10], In 1815, Secretary of State James Monroe told President Madison that a national bank "would attach the commercial part of the community in a much greater degree to the Government [and] interest them in its operations…This is the great desideratum [essential objective] of our system. After the liquidation of the debt, future revenues could be applied to funding the military. Arthur M. Schlesinger Jr., who wrote The Age of Jackson (1945), adopts a similar theme, celebrating Jacksonian democracy and representing it as the triumph of Eastern workers. The Bank's supporters, however, struck back. Jackson called the passage of these resolutions a "glorious triumph", for it had essentially sealed the Bank's destruction. [190] By diverting both groups in a campaign against the central bank in Philadelphia, Jackson cloaked his own hard-money predilections, which, if adopted, would be as fatal to the inflation favoring Jacksonians as the B.U.S. A March 1830 report authored by Senator Samuel Smith of Maryland served this purpose. [122] Jackson remained unconvinced of the Bank's constitutionality. Meanwhile, Biddle wrote to Webster successfully urging the Senate not to support Stevenson as minister. Indeed, Livingston was alone in the cabinet, for only he opposed a veto, and Jackson ignored him. [155] After months of debate and strife, pro-B.U.S. President Andrew Jackson announces that the government will no longer use the Second Bank of the United States, the country’s national bank, on September 10, 1833. The circular, he claimed, was necessary to prevent excessive speculation. [300] Including when taking into account the recession engineered by Biddle, the economy expanded at an unprecedented rate of 6.6% per year from 1830 to 1837. [138][145] They did however assure Biddle that Jackson would not veto the bill so close to the 1832 election. Clay demurred. reserves for speculative ventures. [73] In January 1829, John McLean wrote to Biddle urging him to avoid the appearance of political bias in light of allegations of the Bank interfering on behalf of Adams in Kentucky. Business leaders in American financial centers became convinced that Biddle's war on Jackson was more destructive than Jackson's war on the Bank. [307], Woodbury ensured that banks' specie ratios remained consistent with those of the early 1830s. [282][283][284] The Coinage Act of 1834 passed Congress on June 28, 1834. Its charter expired in 1811, but in 1816 Congress created a Second Bank of the United States with a charter set to expire in 1836. Summarize the events and the results of the election of 1832. However, Jackson won by a landslide. His veto message was a polemical declaration of the social philosophy of the Jacksonian movement that pitted "the planters, the farmers, the mechanic and the laborer" against the "monied interest". Several states, including Kentucky, fed up with debt owed to the Bank and widespread corruption, laid taxes on the National Bank in order to force it out of existence. The purpose of the act was to eliminate the devaluation of gold in order for gold coins to keep pace with market value and not be driven out of circulation. By expanding the veto, Jackson claimed for the president the right to participate in the legislative process. At least partially, this was a reasonable response to several factors that threatened the Bank's resources and continued profitability. Candidates were called at national nominating coventions for the first time too. [223] Meanwhile, Jackson sought to prepare his official cabinet for the coming removal of the Bank's deposits. president in the legislative process as evidence of the Bank’s corrupting influence on free government. The main result of Jackson's mistake was inflation, or an increase of the price of products and a decrease in the value of money. favored merchants and speculators at the expense of farmers and artisans, appropriated public money for risky private investments and interference in politics, and conferred economic privileges on a small group of stockholders and financial elites, thereby violating the principle of equal opportunity. He went on to argue that if such an institution was truly necessary for the United States, its charter should be revised to avoid constitutional objections. [9] The push for the creation of a new national bank occurred during the post-war period of American history known as the Era of Good Feelings. [249] Jackson predicted that within a matter of weeks, his policy would make "Mr. Biddle and his Bank as quiet and harmless as a lamb". [58] Banks have to lend more money than they take in. Jackson ordered that no more government funds be deposited in the bank. [35], In 1828, Jackson ran again. [159] The House was dominated by Democrats, who held a 141–72 majority, but it voted in favor of the recharter bill on July 3 by a tally of 107 to 85. Consequently, Jackson set out to destroy the Bank. Let us know if you have suggestions to improve this article (requires login). The net result of this substitution was that Mexican silver swelled the US monetary base. Benton called the statement an "atrocious calumny". [270] Jackson retaliated by calling Clay as "reckless and as full of fury as a drunken man in a brothel". Biddle was eventually forced to relax the bank’s credit policies, and in 1837 the Senate expunged the censure resolution from its record. They called themselves Whigs after the British party of the same name. These were to be used only to counteract any hostile behavior from the B.U.S. [54] Jackson and other advocates of hard money believed that paper money was part of "a corrupting and demoralizing system that made the rich richer, and the poor poorer". Indeed, Jackson had predicted in his first annual message of 1829 that the Bank's stockholders would submit an early application to Congress. His “war” on the banking industry was mostly bark instead of bite, as he withdrew funds from the national bank to deposit them in state and local banks. [247] Taney attempted to move tactfully in the process of carrying out the removals so as not to provoke retaliation by the B.U.S. [103][104][105], In his second annual address to Congress on December 7, 1830, the president again publicly stated his constitutional objections to the Bank's existence. [138] Clay and Webster secretly intended to provoke a veto, which they hoped would damage Jackson and lead to his defeat. Clay demanded that he retract his statements. [304], Jackson's destruction of the B.U.S. [248] At least two of the deposit banks, according to a Senate report released in July 1834, were caught up in a scandal involving Democratic Party newspaper editors, private conveyance firms, and elite officers in the Post Office Department. Opponents referred to these banks derisively as "pet banks" since many of them financed pet projects conceived by members of the Jackson administration. This left open the possibility that he could stymie the renewal of the Bank's charter should he win a second term. These plans may have reflected a desire to transfer financial resources from Philadelphia to New York and other places. But Jackson's strategy eventually paid off as public opinion turned against the Bank. Inflation soon rose and the Kentucky Bank became in debt to the National Bank. The committee members refused, and no books were shown to them. [155][156] For the past six months he had worked in concert with B.U.S. "If you apply now," McLane wrote Biddle, "you assuredly will fail,—if you wait, you will as certainly succeed. [121], These reforms required a rapprochement between Jackson and Biddle on the matter of recharter, with McLane and Livingston acting as liaisons. [100][101] These struggles led to Vice President Calhoun's estrangement from Jackson and eventual resignation,[101][102] the replacement of all of the original cabinet members but one, as well as the development of an unofficial group of advisors separate from the official cabinet that Jackson's opponents began to call his "Kitchen Cabinet". [260] When a New York delegation visited him to complain about problems being faced by the state's merchants, Jackson responded saying: Go to Nicholas Biddle. A delay would obviate these risks. [62] Jackson himself, though naturally averse to the Bank, had recommended the establishment of a branch in Pensacola. forces that they would have to step up their campaign efforts. The product presented to Jackson included provisions through which the federal government would reduce operations and fulfill one of Jackson's goals of paying down the national debt by March 1833. Banks making too many loans would print an excess of paper money and deflate the currency. [1] This managed to keep the Philadelphia branch operating at a price of nearly $6 million. [314][315] Southern planters bought large amounts of public land and produced more cotton to try to pay off their debts. Humiliated by its opposition to the war, the Federalist Party, founded by Hamilton, collapsed. [212] The House also stood solidly for Jackson. However, one of the banks drew prematurely on B.U.S. Nearly all politicians joined the Republican Party, founded by Jefferson.

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