States’ Rights and the National Bank
When War of 1812 ended
British flooded american
markets with inexpensive
goods
US Responds with Tariff in
1816
Tariff increased in 1824 and
1828
Jackson’s Vice President John
Calhoun of South Carolina
calls it Tariff of Abominations
States’ Rights and the National Bank
Why
South did not manufacture
finished products
South had to buy expensive
American made products
South felt North was getting
rich at expense of South
Calhoun had been a supporter
of tariff, and nationalism but...
Situation of South Carolina has
him change views
States’ Rights and the National Bank
Calhoun’s theory of Nullification
The South Carolina Exposition
Constitution was an agreement
among Sovereign states
States have the right to nullify
or reject Federal Laws if it
considered it Unconstitutional
If state was given the right
State could withdraw from the
Union
States’ Rights and the National Bank
1830 Haynes Webster Debate
Haynes from South Carolina
argues against tariff
Webster for it
Submission or Revolution
Jackson “Our Liberty must be
preserved”
Calhoun “Union can only be
preserved by respecting states
rights
Calhoun resigns as Vice
President
States’ Rights and the National Bank
Tariff passed in 1832
unacceptable to South Carolina
South Carolina declare
unconstitutional and null and
void
Would secede if Custom
officials tried to collect
Jackson Furious
Threatens to send in troops
Force Bill of 1833 gives
authorization
States’ Rights and the National Bank
Henry Clay
The Great Compromiser
suggests compromise
Ten year tariff that reduces
over time
Crisis averted
Will remerge as cause of Civil
War
States’ Rights and the National Bank
2nd Banks of the United States
Charter to expire in 1836
Clay and Webster call for early
renewal to make Campaign
issue
Jackson successfully paints
bank as bank for privileged
Bank had unfair advantage
because of large deposits
Stockholders reaped dividends
Bank gave low rate loans to
Congressmen
States’ Rights and the National Bank
1832 Jackson appointed US
Treasurer diverts Federal funds
to “Pet Banks” loyal to
Democrats
BUS retaliates by calling in
loans and not offering new
loans
Businessmen fore bank to alter
policy
Jackson vetoes new Charter
Charter expires, becomes
regular bank, goes out of
business
States’ Rights and the National Bank
Actions of Jackson form
enemies
Clay, JQ Adams, Webster for
Whig party
Backed American System
and Banking system, currency
1836 Election won by Martin
Van Buren
States’ Rights and the National Bank
Pet Banks print too much
money
Notes became worthless
Jackson orders gold and silver
the only specie
Banks stop accepting paper
currency
Credit collapses, economy
collapses
Panic of 1837
States’ Rights and the National Bank
1840 Election
Van Buren v. Harrison
Harrison Common man
Harrison, Whig Party wins
Die in first month of office
John Tyler becomes President
add been added to pick up
southern votes