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President Thomas Jefferson, when he assumed office, refused to renew the charter for the First National Bank. The United States was without a central bank until the financial troubles during the War of 1812 led Congress to finally establish a charter for the Second National Bank. This charter is to last for twenty years, and it begins with a fund of thirty-five million dollars. The Bank struggled for many years until its third president, Nicholas Biddle, became in charge by the end of the 1820s. -
Also known as "the first Great Depression," the Panic of 1819 was a point of severe economic struggle in the United States. The growth that followed the War of 1812 came to an abrupt halt. The unemployment rate skyrocketed, the state banks were failing, mortgages were foreclosed, and agricultural prices were cut in half. Property values also fell by half and thousands of people were committed to debtor's prison. Businesses went bankrupt and poverty spread like the plague. -
Andrew Jackson and John Quincy Adams run against each other. Here we see the emergence of the two political parties that are modernly known as Democrats and Republicans. When Andrew Jackson was elected, he used his platform and his campaigns to elevate his support for striking down the charter of the Second National Bank, and claiming the support of the People. -
President Andrew Jackson gives his first annual address to Congress, wherein he calls to question the National Bank's constitutionality and expediency. Jackson alleges, also, that the Bank had failed to establish a stable and common currency. To amend this, Jackson proposed his own idea for a Bank, which would be established on the government's credit. Of course, this was received negatively, because people saw it would lead to political corruption and excess paper money. -
Andrew Jackson easily wins re-election against Henry Clay. After assuming presidency, Jackson vetoes the recharter for the National Bank. Nicholas Biddle, the President of the Bank, wanted Jackson to decide the fate of the Bank before his re-election. Jackson publicly framed the Bank as being corrupt and elitist. The People were convinced by Jackson's ideals and his victory over Henry Clay. -
Congress passes a bill to extend the Second Bank's charter. Andrew Jackson vetoes the bill, claiming a National Bank was unconstitutional and a great danger to the People. When Jackson is re-elected, he announces that the government will deposit Federal funds into state banks rather than the National Bank. Congressmembers who supported the Bank were furious and attempted to censure Jackson. The President, however, remained resolute, and the Bank's charter expired in 1836 and was never renewed. -
Senator Daniel Webster is one of the many people angered by President Jackson's decision to veto the re-charter of the Second National Bank. Webster called Jackson out, claiming that no president has the authority to deem something unconstitutional when the Supreme Court has already firmly declared the law protecting it. Overriding this law implies, according to Webster, that any president could simply ignore and refuse to enforce a bill if he really didn't want it to come to fruition. -
Henry Clay forms a new domineering political party called the Whigs. The Whigs are extremely antimonarchial and portray President Jackson as "King Andrew." The Whig Party included Anti-Masonic individuals and Democrats who were disenchanted with Jackson. The party also included Evangelical Protestants and abolitionists and other people who were against the harsh treatment of Native Americans. The one thing that united them was their support for the U.S. National Bank. -
Instead of removing all money that is already in the National Bank, only new revenue is relocated and deposited into seven "pet" state banks. What remains in the National Bank vaults is paid off in the natural course. -
Treasury Secretary William J. Duane refuses President Jackson's demand to remove funds from the National Bank. This authority, in fact, comes from the Secretary of Treasury, and not the President. Jackson, however, fires Duane anyway. Jackson takes this dismissal as a sign that he can remove members of his cabinet without consulting Congress beforehand. -
Rapid economic growth, increased speculation of western growth, and rising land prices led to another economic panic. Since the banks did not have enough gold and silver to redeem paper money, most of them declared bankruptcy or shut down for awhile. Bank assets fell by almost half, business was slow, and there was no more credit. -
William Henry Harrison defeats Martin Van Buren. Harrison, a staunch supporter and member of the Whig Party, establishes a new plan for a National Bank. Harrison dies 32 days later, leaving John Tyler to succeed over him. Tyler is proven to not be a Whig, and he soon derails the economic plan Harrison had been devising. Instead, the Independent Treasury System was established, where funds were placed in federal vaults and sub-treasury offices across the United States.