Jackson
The Economy & Banks
• I. Tariff of 1828
• A. Protective tariff- tax placed
on imported goods to support sale
of American good
–1. Protective tariffs: 1816,
1824, 1828, & 1832.
–2. Tariff of 1828
•a. South was suffering from
depressed cotton market
•b. Injured Southern economy
–c. Duties were as high as 45%
–d. Actually passed by Jackson
supporters to unseat JQA
–e. New Englanders- wise to
plan & accepted tariff
• II. Tariff 0f 1832
–A. Amended tariff of 1828 to
appease South
•1. Did not go far enough
•2. Lowered from 45 to 35%
•3. South- tariffs appeared
permanent
• B. Nullifiers (Nullies) &
Unionists Clash
• C. Almost caused a civil war
–1. Jackson threatens to hang
Nullifiers
–2. Ex-Senator Robert Hayne
–If a civil war was to be
avoided one side had to
compromise
• D. Compromise- Tariff 1833
–1. Passed to appease South
–2. Gradually lowered tariffs
• E. Force Bill
–1. Jacksonians save face
–2. Authorized President to use
army & navy to collect tariff
duties
• “The Bank is trying to kill me, but I
will kill it.”
• I.Bank of the United States(BUS)
–A. McCulloch v. Maryland
(1816)
– Upheld constitutionality
of national bank
• B. Jackson
–1. Against recharter of B.U.S.
•a. Henry Clay behind it
•b. Hurt West financially
•c. Felt it was a tool of
Northeastern elite
(Nicholas Biddle)
• C. Jackson Vetoes Recharter Bill of
1832
–1. Unconstitutional
–2. Abuse of executive power
–3. Argued that he found Bill
personally harmful
–4. In effect- presidential power
equal to 2/3 of Congress
• 5. Jackson won the election of
1832 based on the issue; the
common people agreed with
him.
• D. Jackson’s Reaction & B.U.S.
–1. Vowed to kill Bank
–2. Withdrew found from B.U.S. &
put them into state banksPet Banks
–3. Forced B.U.S. to reverse policy
and extend easy credit to
state banks
–
–5. Nicholas Biddle- tried to
force the state banks to convert
to gold which led to an
inflationary spiral
–6. Panic of 1837- economic
depression