Background
Andrew Jackson was a self-made man. After fighting in the Revolutionary War, he moved to Tennessee to become an attorney. There, Jackson's accomplishments put him in contact with the state's most powerful politicians. His connections moved him from the U.S. House of Representatives and eventually to the White House, all from his humble beginnings. It was this way of life that Jackson believed the country should operate. The common man should have the opportunity to make a good life for himself and his family. However, changes in the American economy were making that less of an option. Corporations had control of large amounts of resources and made a small amount of people wealthy, subsequently making it harder for others to succeed. Also, specie, or coined money, was low in circulation and was not economical to be traded on a daily basis. During Jackson's presidency, he fought for the common man's place in the building of the United States; this is especially evident in the bank war.
The first Bank of the United States was chartered in 1791. (1) The Bank would allow for the country to economically recover from the Revolutionary War and fund the industrializing nation. (2) Banking, however, was not yet a well understood occupation; customers often suffered because of this. (3) Alexander Hamilton, then Secretary of the Treasury, pushed to have the bank chartered in Congress. While he did succeed, there was clear opposition to the bank, led byThomas Jefferson. He, like Jackson, was a self-made man who believed that a central bank would hamper individual opportunity to succeed, essentially creating an all-powerful wealthy upper class. (4) The opposition to the first bank continued for the duration of the 20 year charter. When the option to reissue the charter was brought before Congress in 1811, there was not enough support. (5) However, it would not be long before a second Bank would be discussed in Congress.
The first Bank of the United States was chartered in 1791. (1) The Bank would allow for the country to economically recover from the Revolutionary War and fund the industrializing nation. (2) Banking, however, was not yet a well understood occupation; customers often suffered because of this. (3) Alexander Hamilton, then Secretary of the Treasury, pushed to have the bank chartered in Congress. While he did succeed, there was clear opposition to the bank, led byThomas Jefferson. He, like Jackson, was a self-made man who believed that a central bank would hamper individual opportunity to succeed, essentially creating an all-powerful wealthy upper class. (4) The opposition to the first bank continued for the duration of the 20 year charter. When the option to reissue the charter was brought before Congress in 1811, there was not enough support. (5) However, it would not be long before a second Bank would be discussed in Congress.
The Second Bank of the United States
Five years later, the Second Bank of the United States was chartered. It was the War of 1812 that highlighted the need for a national bank. The war had put the country in debt and local banks were issuing large amounts of bank notes. (6) This caused confusion, and the bank was seen as a way to regulate and calm the nation's economy. The bank was granted the power to be the bank of the United States government, dispersing federal funds and carrying out loans. The second Bank, a for-profit institution, paid congress $1.5 million to not create any competing banks. (7) The second Bank went through a series of presidents until Nicholas Biddle came to power in 1823. Biddle "had an airy way of speaking that shocked his more credulous enemies and did him irreparable harm." (8) It was this attitude that led people, including Jackson, to believe that he was not fit to be in charge or that the bank should have that much power. Biddle was given nicknames of Czar Nicholas and Emperor Biddle. (9) During the campaign of 1828, Jackson spoke out against the economic corruption caused by the Bank and President Adams. Jackson's election set up a war with Biddle over the future of the second Bank of the United States. There were only seven years remaining in the charter of the second Bank when Jackson came to office. Originally, Jackson did not want to completely shut down the bank; rather, he sought to bring the bank under his control. (10) In a political move, Biddle applied for an early recharter in 1832, an election year, challenging Jackson to make the next move. (11) After Congress passed the recharter, it was given to Jackson, who promptly vetoed the bill.
Having considered it with the solemn regard to the principles of the Constitution which the day was calculated to inspire, and come to the conclusion that it ought not to become a law, I herewith return it to the Senate, in which it originated, with my objections. A bank of the United States is in many respects convenient for the Government and useful to the people. Entertaining this opinion, and deeply impressed with the belief that some of the powers and privileges possessed by the existing bank are unauthorized by the Constitution, subversive of the rights of the States, and dangerous to the liberties of the people , I felt my at an early period of my administration to call the attention of Congress to the practicability of organizing an institution combing all its advantages and obviating these objections. I sincerely regret that in the act before me I can perceive none of those modifications of the bank charter which are necessary, in my opinion, to make it compatible with justice, with sound policy, or with the Constitution of our country.
-President Andrew Jackson's veto message. July 10th, 1832 (12)
A copy of Jackson's veto message distributed by the Harold Office. Image Credit: The Library of Congress (Digital ID : http://hdl.loc.gov/loc.rbc/rbpe.19403000)
War Breaks Out
President Jackson's veto denied the constitutionality of the bank, the amount of foreign stockholders, and the large amount of capital that the bank had. The McCulloch v. Maryland Supreme Court case in 1819 stated that the bank was constitutional; however, Jackson believed that he had a separate power from the court to judge the constitutionality. (13) The day after Jackson vetoed the recharter, a rebuttal came from Daniel Webster. Webster, senator from Massachusetts, was one of the main proponents of the bank,and along with John Calhoun and Henry Clay, he formed the Great Triumvirate. His reply condemned Jackson for rejecting the bank. Webster stated, "Mr. President, I will not conceal my opinion that the affairs of the country are approaching an important and dangerous crisis. At the very moment of almost unparalleled general prosperity, there appears an unaccountable disposition to destroy the most useful and most approved institutions of the government." (14) The reply goes on to say that the bank is actually protecting the people through providing capital and welcoming foreign investment.
There obviously was a heated argument in the political sphere. The two men had both argued for protecting the rights of the people and allowing the country to flourish economically, but had different ideas of how to do that. How did the people react to the bank war? People spoke out in newspaper editorials and letters. There seemed to be a fair amount of support for both sides, with Webster and Biddle receiving slightly more. An editorial posted in the Boston Daily Atlas suggested that Jackson abused the plight of the poor to get his way. (15) Another editorial from the Portland Daily Advertiser makes the same claim against Jackson. (16) Both of these accounts suggest that Jackson had turned himself into a tyrant or king. Members of the public also displayed their opinion of the president in cartoons. Jackson's bank policy had fervent support. Senator Thomas Hart Benton was a crusader for the common man who believed that paper money created by the banks was weak and vulnerable to corruption. (17) Benton stated very plainly while addressing the Senate that he believed that the Bank did not support the "public good." (18) Despite all of these differing opinions, Jackson was re-elected in 1832 with a majority of the popular vote.
Removal and a Censure
On a wave of popular support, President Jackson wanted to remove the funds from the Bank in the Spring of 1833. Jackson stated in a message to his cabinet, "Whatever may be the opinions of others, the President considers his reelection as a decision of the people against the bank." (19) The veto was not enough to completely kill the bank as it still had a few years left in its charter, but the removal of federal funds would certainly damage it. (20) Jackson needed the support of his cabinet to begin removal. When he realized that he did not have much support, he did some reorganizing. The Bank charter stated that only the Treasury Secretary could remove funds from the Bank. (21) Jackson removed his secretary, who supported the bank, and replaced him with Roger B. Taney, a man ready to do Jackson's bidding. Taney began removal on September 23rd, 1833.
Outcry against Jackson's removal plan was so great that it sparked the formation of a new political party, the Whig Party, which formed in the winter of 1833. The party's primary opposition to Jackson was his expansion of the executive powers. The party, headed by Senator Clay, a long time proponent of the bank, demanded investigations into Jackson's use of power. Clay argued that just because he was elected did not mean that Jackson could disregard the rules of the office as set before him by the Constitution. (22) Clay and the Wigs successfully voted on a censure of President Jackson. On April 15th 1834, Jackson issued a message to the Senate protesting his censure. Jackson railed against the Senate stating that their censure was vindictive and unconstitutional. (23) He also stated that he had followed the rules of the original charter when removing funds from the Bank. The message closed with Jackson picking out senators from three different states, Ohio, Maine, and two from New Jersey. These men came from states that agreed with Jackson's opinions about the bank, and had they been true representatives of their state, they would not have voted against him and the censure would not have passed. (24) The Whigs successfully rejected Jackson's protest and also held up the confirmations of his cabinet. (25)
Outcry against Jackson's removal plan was so great that it sparked the formation of a new political party, the Whig Party, which formed in the winter of 1833. The party's primary opposition to Jackson was his expansion of the executive powers. The party, headed by Senator Clay, a long time proponent of the bank, demanded investigations into Jackson's use of power. Clay argued that just because he was elected did not mean that Jackson could disregard the rules of the office as set before him by the Constitution. (22) Clay and the Wigs successfully voted on a censure of President Jackson. On April 15th 1834, Jackson issued a message to the Senate protesting his censure. Jackson railed against the Senate stating that their censure was vindictive and unconstitutional. (23) He also stated that he had followed the rules of the original charter when removing funds from the Bank. The message closed with Jackson picking out senators from three different states, Ohio, Maine, and two from New Jersey. These men came from states that agreed with Jackson's opinions about the bank, and had they been true representatives of their state, they would not have voted against him and the censure would not have passed. (24) The Whigs successfully rejected Jackson's protest and also held up the confirmations of his cabinet. (25)
"I Have Obtained a Glorious Triumph."
Despite issuing the censure, the Whigs and other opponents of the Bank could not stop President Jackson's war. The veto could not be overturned because there was not a two-thirds majority in the Senate. (26) In 1834, Jackson removed the power over Revolutionary War pensions from the Bank and gave it to the War Department. Biddle rejected this order, which caused veterans to riot and turn against the bank. The following panic was blamed on Biddle and the Bank. (27) Democratic senators tried to come up with a new bank that would function in an acceptable way, but this angered Jackson. He had just spent years trying to kill a national bank, and he did not want another one. Rather, he wanted to stick to the plan of state banks and returning the nation to a specie economy. Jackson planned to do so by slowly removing bank notes from circulation. (28) The final blow to the bank came on April 4th, 1834 when Congress voted in support of Jackson's bank plans. The bank would not be rechartered. The second Bank of the United States was dead. When the charter expired, it became the United States Bank of Pennsylvania, which Biddle presided over until resignation in 1839; two years later, the bank dissolved. (29)
The midterm election of 1834 gave the Democrats control of the House. This allowed for the passage of all of Jackson's economic plans. Blame for the Bank and all of its failings was officially placed on Biddle and other supporters of the Bank. Also, on December 26th, 1837, President Jackson's censure was removed from the record of the Senate. Jackson was exalted in the Senate as a protector of the constitutional rights of the president. (30) While discussion of whether or not this was the right economic choice for the country is still discussed today, Jackson had officially won his war.
The midterm election of 1834 gave the Democrats control of the House. This allowed for the passage of all of Jackson's economic plans. Blame for the Bank and all of its failings was officially placed on Biddle and other supporters of the Bank. Also, on December 26th, 1837, President Jackson's censure was removed from the record of the Senate. Jackson was exalted in the Senate as a protector of the constitutional rights of the president. (30) While discussion of whether or not this was the right economic choice for the country is still discussed today, Jackson had officially won his war.