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Bank Recharter Bill
A bill in which would renew the 20-year charter for the Second Bank of the United States.
Daniel Webster and Henry Clay of the National Republican Party wanted to renew the charter prior to its expiration and had convinced its president, Nicholas Biddle, to apply.
President Jackson and the Democrats, however, opposed the recharter bill because they believed it greatly favored Northern elitists. -
Jackson's Vetoes
President Jackson vetoed the Bank Recharter Bill and argued against its constitutionality power over financial affairs.
Jacksonian Democrats supported the veto because it would lessen the power of the elite and uphold the power of the common man.
National Republicans opposed the veto because because the Bank would no longer be able to regulate the national currency. -
Election of 1832
Democrat Andrew Jackson was reelected, claiming 219 of the 286 electoral votes, against National Republican Henry Clay in the 12th presidential election.
The victorious Democrats, favoring Jackson’s veto, remained satisfied in retaining power in the federal government.
The defeated National Republicans feared for the eventual dismantling of the Second Bank of the United States. -
Jackson Removes Federal Deposits
Using his executive power, President Jackson removed all federal deposits from the Second Bank of the United States and began the “Bank War.”
Democrats supported Jackson’s dismantling of the Bank as it would equalize elitists and the common man.
National Republicans and the recently formed Whigs believed that the economy would collapse without the national bank. -
Biddle Response
Nicholas Biddle made efforts in rechartering the Second Bank of the United States by presenting state bank notes as loans in order to spur up a financial crisis.
Jackson remained unwavered and Democratic anti-Bank sentiment grew.
Whigs believed that it would stress the economic need for a centralized bank. -
Jackson's Pet Banks
The removal of federal funds from the Second Bank of the United States resulted in its redistribution to 7 state banks, popularly called “pet banks,” around the country.
Democrats supported Jackson’s “pet banks” as it would favor more of the middle and lower classes.
Whigs continued to oppose Jackson’s action and believe that only the national bank would be able to stabilize the economy. -
Speculative Boom
The fallacy that the abundance of money means economic growth led speculators to purchase more land using inflated money from state banks.
Democrats saw the speculative boom as positive encouragement for the poor to buy land in order to be wealthier.
Whigs believed that excessive land purchases with inflated money would lead to an economic depression. -
Specie Circular
An executive order by President Jackson in which required metallic currency for government land purchases.
Democrats opposed the executive order because it made getting a loan more difficult with gold and silver instead of paper.
Whigs saw the executive order as a late attempt to prevent the eventual Crash of 1837 due to the surplus of printed money. -
Crash of 1837
The United States underwent a financial crisis in which created a long-lasting recession into the mid-1840s.
Both Democrats and Whigs were negatively affected and were devoted to recharter the Second Bank of the United States and restore the economy.
