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PRIMARY DOCUMENTS  |  The Bank War: Jackson Veto and Webster's Reply, 1832
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Enrichment and Extension

  1. Have students research the election of 1832, using the library, Internet, and textbook sources. Have students create a T-chart with columns for Jackson and Clay listing: party affiliation; positions on the following issues: the Second Bank of the United States, the Maysville Road, tariffs, and Indian removal; number of electoral votes won; number of popular votes won; states won (by name).

  2. Hold a mock debate between Democrats and Whigs at the end of Andrew Jackson's presidency, evaluating his handling of four issues: the Bank War, federally-funded internal improvements, the Nullification Crisis, and Indian removal. Divide the class into four groups of Democrats and four groups of Whigs. Assign one group on each side to research and present its party's views on Jackson's handling of the Bank War; one group on each side to Jackson's handling of federally-funded internal improvements, etc. For the debate itself, on each issue, give the parties 4 minutes each to present their views, then allow each side 1 minute to rebut the other side; then move on to the next issue.


Clay, Webster, and Biddle miscalculated. Not only were they unable to muster the votes in Congress to override Jackson's veto, but the Bank veto did not cost Jackson as much popular support as they expected. Despite the immense funding which Biddle poured into Clay's campaign for the presidency, Jackson won reelection, although he received fewer popular votes than in 1828. After his reelection, the president declared war on the Bank. He believed the Bank was too dangerous to tolerate its continued existence, even for the four years remaining on its original charter. On his own authority, without congressional approval, he ordered the secretary of the treasury to stop depositing the federal government's money in the Second Bank and place it instead in selected state banks. The secretary of the treasury refused, and Jackson removed him, appointing a new secretary of the treasury. He also refused, and Jackson removed him, too, appointing yet another secretary of the treasury. This third secretary, Roger Taney, did as Jackson ordered. He placed the money in 89 state banks, mostly run by Jackson supporters. Since the Bank's original charter, passed by Congress in 1816, required the federal government to put its deposits in the Second Bank, Congress considered Jackson's order illegal. Congress eventually censured Jackson, the first time it ever censured a president. Congress also refused to confirm Taney's appointment as secretary of the treasury; Jackson later appointed him as chief justice of the Supreme Court as a reward for his loyalty.

Nicholas Biddle reacted badly to Jackson's attack. He ordered the Bank to stop making many loans, deliberately causing a brief economic slowdown in 1834, in hopes of forcing Jackson to change his mind. Biddle's willingness to use the Bank's power, even at the cost of hurting many innocent people, only made Jackson more determined. "I have it chained," he observed, "the Monster must perish." And, indeed, without the federal deposits, the power of the Second Bank of the United States began to wane. Its banknotes no longer enjoyed such a strong reputation, and its ability and desire to regulate state banks weakened. The now-unregulated state banks irresponsibly printed large quantities of bank notes, one of many factors which contributed to another, more serious financial depression known as the Panic of 1837. By that time, the Second Bank of the United States no longer existed; it had become a state bank in Pennsylvania.

Facts about the Second Bank of the United States:
  • Like banks today, the Second Bank of the United States was owned by stockholders who bought stock in the Bank. The Bank's charter required that the U.S. government own one-fifth of the stock. Foreigners could buy stock in the Bank.

  • There were 25 members of the Bank's board of directors, responsible for overseeing the Bank. The U.S. government appointed 5 members, while the Bank's American (not foreign) stockholders elected the rest. A president, chosen by the board of directors, ran the Bank's day-to-day affairs.

  • The Second Bank, chartered by Congress, operated 29 branches all over the nation. In the Bank's charter, Congress agreed to charter no other national banks. The other banks in the country were chartered by state governments; these banks each operated in just one state. Under Nicholas Biddle, who became its president in 1823, the Second Bank informally regulated these banks, trying to make them behave more responsibly.

  • The Bank's charter required the U.S. government to deposit its funds in the Second Bank. Between these government deposits and private deposits, the Second Bank controlled one-third of the bank deposits in the country.

  • The federal government did not print paper money; instead, it issued gold and silver coins which were known as specie. Both the state banks and the Second Bank issued banknotes to borrowers and depositors. These banknotes had the issuing bank's name on them and were redeemable in specie (that is, a person could turn the banknotes in at the bank and receive gold or silver coins in return). The banknotes served as paper money.

  • Most people were willing to accept paper money in place of specie, as long as they had confidence that the bank was sound and could provide them with specie if they wanted it. Therefore, banks kept a certain amount of specie on hand to pay depositors who wanted it. Under Nicholas Biddle, the Second Bank usually kept more specie around than most state banks did and earned a reputation as being more reliable than state banks.

  • The Second Bank had several advantages over state banks when it came to issuing notes. The U.S. government accepted its banknotes as payment for taxes. Also, because the Second Bank had such large deposits of specie (thanks in part to the federal deposits), it could issue large amounts of banknotes while maintaining a high ratio of specie to paper money.


Kaplan, Edward S. The Bank of the United States and the American Economy. Westport, CT: Greenwood Press, 1999.

American Memory Project, Library of Congress. A Century of Lawmaking for a New Nation: U. S. Congressional Documents and Debates, 1774-1873.

Meltzer, Milton. Andrew Jackson and His America. New York: Franklin Watts, 1993.

Peterson, Merrill D. The Great Triumvirate: Webster, Clay, Calhoun. New York: Oxford University Press, 1987.

Remini, Robert V. Andrew Jackson and the Bank War: A Study in the Growth of Presidential Power. New York: Norton, 1967.

Remini, Robert V. The Life of Andrew Jackson. New York: Harper & Row, 1988.


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