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Second Bank of the United States
The Second Bank of the United States was about as unpopular as the first National Bank. The second bank was chartered by James Madison and was created to model the first National Bank. The Second Bank was unpopular throughout the new states, territories, bankers, and poor people. Bankers despised the banks control over the currency and credit in the country. And the poor people believed that the bank just supported the interest of wealthier people rather than people with less money. -
Panic of 1819
The Panic of 1819 was the first big financial crisis in the United States. Because of the crisis, it slowed westward expansion and led to a collapse in the economy that lasted until 1821. The crisis initially started because there were too many bank notes and credit lines that were being released by the bank. When the bank started to try to get these notes and credit lines back, as well as loans, farmers went bankrupt, meaning that without all the revenue coming in, the economy took a big hit. -
Bank Recharter Bill
Since the Second Bank of the United States was chartered for 20 years, it wasn't set to expire until 1836, since it was first chartered in 1816. People who wanted the bank and favored it, such as Henry Clay, decided to propose the recharter to be earlier than it expired. This was a tactic that was used in order to put President Andrew Jackson on unstable political grounds. -
Bank Recharter Vetoed
Because of President Andrew Jackson's view, he did not trust the national bank, even though they both were successful. When people like Henry Clay started pushing for an earlier renewal, Jackson shut it down and vetoed the renewal for the bank. While many businessmen were upset at his veto, his supporters were happy because they thought he was doing it for the commoners. -
Election of 1832
During the Election of 1832, the National Bank played a big role in the question of who was going to win. Jackson called the national bank a "monster" and was re-elected the President of the United States and defeated Henry Clay, who was an advocate for the National Bank. -
Creation of the Whig Party
The Whig Party was formed by Henry Clay to oppose President Andrew Jackson and the Democratic Party. The Whigs wanted a Second National Bank and Jackson refused to fund it, so they created the Whig Party, which became one of the two major political parties at the time. The Whigs didn't just want a national bank, but they also wanted protective tariffs and aid from the government for internal improvements. -
The End of the Second National Bank
The final act of the 'Bank War' was President Jackson ordering the end of the Second National Bank. Jackson ordered that all of the federal funds be removed and ordered any and all deposits of federal money stop. Because of this 'pet banks' were created to store all of the federal money. -
Pet Banks
Due to the ending of the Second National Bank, pet banks were state banks that were chosen by the federal government to house and receive treasury funds. This mistake caused a major economic panic because it failed to control the economy. -
Specie Circular
The Specie Circular was an executive order given by Jackson that required the payment of public land to be paid in either gold or silver. Because of this demand by President Jackson, the people could not pay in bank notes, which meant the demand for species, or money that were in the form of coins, went up. This demand led to bank failures, credit reductions, and an increase in unemployment. This was the ultimate leading factor in the Panic of 1837. -
Panic of 1837
The Panic of 1837 was yet again another financial crisis for the United States, the panic ended up lasting until the mid-1840s. Due to the Panic, which was caused by the specie demand and the Bank War, unemployment increased, expansion west stopped, and profits and wages for the people went down. The Panic started at the beginning of President Martin Van Buren's presidency, who got to deal with Jackson's financial issues. -
Election of 1840
During this election, the Whigs, who were represented by General William Henry Harrison, won the election over President Martin Van Buren. This marked the first official time when a non-Democrat or Republican won an election. The Whig Party's strategy was making sure to avoid national issues that would cause a split in the people's views. By avoiding those sensitive issues, they were able to win the Presidential election.