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Second National Bank
Hamilton proposed the idea of a national bank, and it was well supported under Federalist rule. But, once the Republicans came into power, the bank was left to expire, and national debt and inflation skyrocketed. James Monroe, a Republican himself, proposed the idea of a Second National Bank, with the Supreme Court Decision in McCulloch v. Maryland upholding that the national bank was fully constitutional. -
Nicholas Biddle and the rise of the Second National Bank
With a rough start and huge unpopularity among the new states who viewed the Second National Bank as a monopoly on US currency, the bank was able to make a good name for itself. It was well-managed and proved to be a valuable service, especially while being led by Nicholas Biddle, the bank's third president. -
Jackson veto's early renewal of the Second National Bank.
Jackson did not trust the National Bank, much less its manager, Nicholas Biddle, an establishment and manager he deemed unconstitutional and corrupt. So in 1832, when bank supporters in Congress issued an early renewal of the bank, Jackson was quick to veto their request, and his veto was unable to be overturned, putting an inevitable end to the Second National Bank. -
Election of 1832
This Andrew Jackson vs. Henry Clay election of 1832 showed a key divide in the nation; the divide between established merchants and industrialized manufacturers, and simple people eager to grow their wealth with sound currency. This divide foreshadowed conflicts that would arise and become more prominent in later years. -
Formation of the Whigs
Following the Election of 1832, Jackson's opposition banded together to form a new political party, the Whigs, a British term derived from their discontent with Jackson's tyrannical rule. However, it took the Whigs some time to gain traction, and were not yet united by the time the 1836 elections rolled up, so their candidate, William Henry Harrison ultimately lost to Martin Van Buren, Jackson's second vice president. -
Jackson's inevitable victory.
After wiping the floor with Henry Clay in the 1832 elections, President Andrew Jackson assumed that his victory symbolized a public agreement on the end of the Second National Bank, so in September of 1833, he ordered an end to government deposits in the bank, followed by early, gradual withdrawals that were stored in select state banks -
Second National Bank expires
Finally, the Second National Bank met its demise after no bills were passed to renew it. The federal government would lack a central bank for more than a decade until the birth of the Federal Reserve System in 1913 -
Election of 1836
With the ever-increasing popularity of Jackson and the Democratic Party, Jackson's successor, Martin Van Buren was able to win with 170 electoral college votes, a huge majority over his opposition, namely William Henry Harrison, the Whig's first-ever presidential candidate, who only acquired 73 electoral votes, but would return to settle the score in the next elections. -
Panic of 1837
Following the expiration of the national bank, and the victory of Van Burren in the 1836 election, select state banks became the primary holders of federal currency and began printing and distributing it in large quantities, causing a rise in inflation. Van Burren proposed and created a short-lived independent treasury system that would separate the national finances from the federal government, a system overturned in 1841. -
Election of 1840
A divided America was seen in 1840, suffering from economic depression caused by Democrats' refusal to continue with the national bank system, Van Buren was destined to lose in 1840, Especially after the growing popularity of Henry Harrison and the Whigs. Unfortunately, Harrison died shortly after becoming president, and his VP, John Tyler, had very different beliefs than those of the Whig Party. Tyler's administration ultimately did nothing, and only further revealed the nation's divides.