How Did The Second Bank Corrupt

He thought that it was giving too much power to one person and did not like that idea. So, Jackson took out all of the US government deposits from the national bank of the United States and deposited it into the state banks. That made the National bank shut down because there was no money running the bank because Jackson, the largest customer of the national bank withdrew all the money out. That action step that Jackson took basically caused a financial crisis because there was no money left in the national bank and caused a depression for the US.

The Bank of the United States was designed to make money and build an economy. It was designed by men like Alexander Hamilton and Robert Morris, but did not benefit the common citizen as much as wealthy investors. Why did a fledgling government need to borrow millions from overseas in order to invest in a “national” bank, to turn around and then borrow the same money back and pay interest on it? The banking system developed by Alexander Hamilton and Robert Morris was prime pickings for speculators, and laid the groundwork for a history of unscrupulous activity regarding our nation’s money supply that continues to this day. The signatures on the Constitution were barely dry before corruption and

The Bank war started in 1832 when the congress, lead by Henry Clay, renewed the Second National Bank's charter even though it wasn't meant to expire till 1836. The Second Bank centralized financial might, jeopardizing economic stability, and it did not answer to anyone within the government. That partly concerned Jackson because he had no way to control it. Also because of his previous election experiences, he thought that a bank with that much power could not remain free from the electoral process. That was one of his reasons for wanting the bank gone, the other was that he saw the national bank system as corrupt and unjust because it only benefited the elites and was suspected to favor the wealthy. Jackson knew that if the bank was not shut down the gap between the rich and poor would keep growing, resulting in an unstable economy. By vetoing the bank’s charter, withdrawing the federal government's deposits from the Bank of the United States, and placing it in state banks called pet banks he was helping then general people and working for the good of the nation. Taking out money from the Second National Bank was a clever way to get what he wanted, but he was simply looking out for the common man. Because the bank only helped the wealthy, a small percentage of the population, he was taking care of the general people and not letting the priority fall to a minority who was

Hamilton’s creation of the first bank in the United States continues to exist in today’s economic environment. However, at that time Hamilton’s proposal was met with widespread resistance from individuals such as James Madison and Thomas Jefferson who considered the creation of a federal bank as unconstitutional. The analysis made by Gordon in his book is consistent with arguments made by to have a bank that would be effective in order to implement the powers authorized by the government as it was implied in the constitution

Also, the Democratic Party allowed for a more representative government and indicated a shift in power to the West to farmers, shopkeepers, and small-business owners who supported Jackson (Hart et al 260). Jacksonian democracy―the idea that common people should control the government―was also a result of the creation of the Democratic Party. Andrew Jackson’s decision to abolish the bank of the United States benefitted and changed the U.S. Jackson believed that the national bank was to the benefit of the rich, at the expense of farmers, workers, and smaller state banks (Hart et al 263). The bank also did not provide an opportunity for capitalists in the West and other regions (Hart et al 263). In 1832, Henry Clay pushed a bill through Congress to recharter the bank four years earlier than its expiration in 1836. Jackson vetoed the bill, claiming that the bank was an unconstitutional monopoly that existed to make the rich richer (Hart et al 263). Jackson

He believed that the Bank has to be abolished due to several reasons. First of all, the bank concentrated the nation's wealth in a single institution which created an unhealthy for the economy monopoly. Second of all, he believed that the bank favored the wealthy over the common people. The third reason was that the bank had too much control over members of Congress. In other words, the subsidy of the bank to one particular party or the lack of the finance could influence the results of the elections at some point. And the bank also favored northeastern states over southern and western states. Thus, Jackson succeeded in destroying the Bank by vetoing its 1832 re-charter by Congress and by withdrawing U.S. funds in 1833. This action led to federal money being put into state banks who then loaned it out freely leading to inflation. State banks were issuing paper banknotes that were not backed by gold or silver reserves which led to rapid inflation. Moreover, the expansion of credit and speculation took place. As a result, state banks collapsed which was a cause of the Panic of 1837. However, despite the crisis and depression, the liquidation of the Bank was an achievement of Jackson’s presidency and led to trivial of the economy later on.

He received Andrew Jackson's (related to managing money) policies, which added/gave to what came to be known as the Panic of 1837. It turned out to be the worst money-based depression that the young nation had yet known. Do Andrew Jackson, whom Van Buren had served as secretary of state, vice president, and close person (who gives opinions about what could or should be done about things), hurt the federal Second Bank of the United States by moving federal money to smaller state banks. Jackson thought the Bank of the United States hurt ordinary people (who lawfully live in a country, state, etc.) by exercising too much control over credit and money-based opportunity, and he succeeded in shutting it down.

When Senator Henry Clay sided with Nicholas Biddle, the president of the Bank, and encouraged him to renew his charter four years earlier. Since Clay was also running for president that year he believed that Jackson had chosen the “unpopular side” and that a “congressional endorsement of the Bank would embarrass or even discredit the president” (Brands 260). Jackson portrayed Biddle as an enemy of the people and made it his personal mission to destroy the Bank personifying it as a “monster corporation”. In the North they favored the Bank because they had strong banking institutions due to industrial economy. Meanwhile, the South did not have much need for the Bank because they were mainly an agricultural economy which meant large amounts of cash were uncommon. In the West, the land was mostly new territory with economies not as developed; therefore they wanted paper money because getting a loan was easier. However altogether, Jackson’s first move was to veto the Bank bill; he viewed this as his mandate for reelection. In the end, Old Hickory’s popularity won the election and he bulldozed right through Henry Clay locking onto his next target, Biddle’s bank. Even with four years left on the Bank’s charter, Jackson could not wait four years for it to expire. Impatiently, Jackson ordered his secretary of the treasury to remove federal deposits from Biddle’s Bank. Although Jackson had wanted to keep the money in a public bank, he never ironed out the details, so they went to state banks instead. In the end, the Bank never regained its

The Bank Recharter Bill of 1832 was a bill designed to renew the corporate charter of the Second Bank of the United States. Although Congress passed the bill, Andrew Jackson vetoed it a week later. President Andrew Jackson opposed the Second Bank of the United States because he believed that it held too much power without accountability and that it was unconstitutional.The bank was heavily biased toward business interests and had no congressional oversight. This bias led the bank to not support western expansion, which Jackson favored. Jackson also felt that the bank was too powerful, both politically and economically.

Jackson felt that the National bank was a monopoly that solely benefited the wealthy and elite. According to Symposium on Successful Presidential Economic Policies, an academic journal, Jackson distrusted eastern banks and the National bank because it gave too much power to elites. Jackson was unhappy with the bank's lending policies and thought it was unconstitutional, even though he went directly against the Constitution by ignoring the supreme court's ruling in the Worcester vs. Georgia case. Stated in Article 3 section one of the Constitution, “The judicial power of the United States shall be vested in one supreme Court,”. The Supreme court declared the National bank to be constitutional. However, the power to renew the bank’s charter laid in the hands of Jackson, whom despised the National bank for seemingly no valid reason. Jackson denied the charter to renew the bank and removed all the government money from the bank. By regularly changing bank notes for coins, the National Bank limited inflation within the country, something state and private banks failed to do. Destroying the only bank that limited inflation soon caused a depression since inflation occurred. Inflation is when there is so much money in circulation that prices rise since the value of the money decreases. Despite Jackson distrusting the bank, it was the bank whom should have distrusted him, for he was the leading force behind the five year financial crisis within the United

Although Jackson was a hard money supporter, he was sensitive to his many soft money supporters, and made it clear that he would object to renewing the charter of the Bank of the United States, which was due to expire in 1836. When Jackson could not legally abolish the Bank of the United States before the expiration of its charter, he weakened it by removing the government’s deposits from the bank. Jackson fired two of his secretary of treasury when they refused to carry out the order because they believed that such an action would destabilize the financial system. Jackson got Roger Taney to carry out his order. Taney took the deposits out of the Bank of the

Nicholas Biddle proved great opposition to President Jackson. He wanted to re-charter the National Bank; however, many people were against Biddle’s decision. This was particularly true of people in the west. They were still wary of a national bank, after the Panic of 1819, which involved mishaps in land speculation. Jackson shared the predominately western opinion that several small banks would be a better service to the nation than one, large bank would. A major problem with a national bank would lie in it’s willingness only to make loans to the wealthy. This would be of no use to the middleclass. Jackson would not allow Biddle to gain any more power than he already had.

Secondly, out of the twenty-five stockholders of the Bank, five of these were government owned. Thus showing support of the Bank by subscribing to one-fifth of its $35 million (Schlesinger 74). In addition, among the Bank’s functions was to hold all government money, sell all government bonds, and make commercial loans. However, no voters could dictate its policies or reign in its power, due to its privately owned status (Roughshod 2). Finally, the government also allowed bank notes to be used as payment for taxes.

These Jacksonian Democrats considered themselves the ultimate guardians of the Constitution, mainly because they believed in a strict constructionist view of it. In 1832, the charter for the US Bank was to expire and he vetoed the bill. He thought that the bank was unconstitutional and that it was “a monopoly of the foreign and domestic exchange… [And] danger to our liberty.” (Doc B) In this document, Jackson’s perspective is that the

The Bank of the United States was technically the second bank of the U.S. since the first bank’s charter ended in 1811. The second bank held a monopoly over federal deposits, provided credit to growing enterprises, issued banknotes that served as a dependable medium of exchange, and used a restraining effect on the less well-managed state banks. Jackson didn’t trust the bank and thought it had too much power, so Jackson sought out to destroy it. There were two different groups when it came to opposition, “soft-money” and “hard-money”. Soft money supporters were progressive, they believed in economic growth and bank speculation. They supported the use of paper money and were mainly made up of bankers and allies to bankers. Hard money supporters were against expansion and bank speculation. They supported coinage only and rejected all banks that used paper money, which included the federal bank. Jackson was a hard money supporter although, he felt sympathy to the soft money supporters. Jackson could not legally end the bank before its charter expired. By removing the