States’ Rights & the Bank of the US
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Transcript of States’ Rights & the Bank of the US
States’ Rights &
the Bank of the US
The South & the Tariff
• After War of 1812:–Protective tariff established–Benefitted businesses in north
trying to compete with Europe–Hurt south – Europe retaliated by tariffs on US exports (cotton)
The South & the Tariff
• Next 2 decades:–US raised tariffs over & over
–The higher the tariffs, the more they helped north and hurt south
“Tariff of Abominations”
• Very high tariff in 1828• Nearly shut down foreign trade
• South took it personally–Saw it as N getting rich off them
John Calhoun• VP under Jackson
–Later Sen from SC
• Had been very nationalistic– Favored Henry Clay’s
American Plan
John Calhoun• SC voters were
against the tariffs• Changed to believe
in states’ rights
• Developed theory of nullification
Nullification• States can choose not to follow
laws if they believe they violate the constitution–Also states can secede if their
constitutional rights are violated
Hayne-Webster debate
• Sens Robert Hayne (SC) & Daniel Webster (MA)
• Very charged debate – threats of secession–Calhoun (VP) on side of Hayne
Jackson’s response
• “The union: it must be preserved.”
• Split Jackson & Calhoun–Calhoun resigned as VP, then
named a Sen from SC (next day)
Tariff of 1832• Milder tariff – SC still against it
–SC said they can ignore it, threatened secession
• Force Bill of 1833 – Jackson threatened to march federal troops into SC
Compromise• Henry Clay (KY) suggested:
–Reduce tariff back to original 1816 level
–SC agreed to it, ended conflict for the time being
Bank of the United States
• Jackson hated BUS–Said it favored northern rich
• BUS was on a 20 year charter–Jackson vetoed bill that would
have rechartered bank–BUS would expire
Bank of the United States
• BUS had all fed gov’s accounts–Hurt state banks – didn’t have a
chance to get deposits–BUS investors received interest
revenue from tax deposits
Jackson’s “Pet Banks”
• Jackson had tax deposits put in hand-picked state banks–Banks loyal to Democrats
• Ended up bankrupting BUS before its charter expired
Creation of Whig Party
• JQ Adams & Clay’s supporters had formed Natl Republicans–Democrats upset over Jackson’s
treatment of BUS joined them
Whig Party• Beliefs:
–Tariffs for US business–Infrastructure spending–National currency & bank
Martin Van Buren• Won election of
1836 easily
• Whigs couldn’t pick 1 person to run against him
Panic of 1837• Result of Jackson’s bank policies
–Relaxed rules over state banks–Allowed state banks to make
risky investments–Investments went bad; banks
went bankrupt–Many people lost everything
Panic of 1837• Investments went bad; banks
went bankrupt
• Many people lost everything
• Over 1/3 of US unemployed
Election of 1840• Van Buren vs. WH Harrison
–Harrison hero of Battle of Tippecanoe
–Harrison’s running mate was John Tyler
–Catchy slogan: “Tippecanoe & Tyler Too”
Election of 1840• Van Buren got nickname too
–He was from Kinderhook, NY–His people began calling him
“Old Kinderhook”–Formed OK Clubs – originated
American slang “OK”
Election of 1840• Bad economy =
Harrison won• Gave long
inauguration speech in snow
• Didn’t wear a coat
Election of 1840• Got pneumonia
• Died in 32 days
• 1st president to die in office
John Tyler (TN)• Never supposed to
have power
• Had run for VP to get south for Whigs
• “His Accidency”
John Tyler (TN)• Disagreed w/Whigs,
got booted from party
• One of weakest presidents ever