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Before the great conflict between the manufacturers and the planters had been brought to a lame conclusion in the force bill and the tariff compromise of 1833, so unsatisfactory to everybody, Jackson had taken up the Bank problem, in which the West was particularly interested. The annual message of 1832 indicated his intention to close up the business in accordance with what seemed to him to be the decree of the people. But while the President regarded an election as settling the matter, it soon became clear that Nicholas Biddle and the leaders of the United States Senate were far from that opinion. Having combined to defeat the "old Indian scalper," as Biddle was wont to term Jackson, in his plan to bring South Carolina to terms, these able men continued their operations to balk him on the Bank question.


The Bank of the United States had a capital stock of $35,000,000, its twenty-nine branches ramified the commerce of the country, and its total volume of business was about $70,000,000, or more than the amount of the national exports each year. It practically controlled the currency, and it could increase or diminish the amount of money in circulation by about one third at any time. Nicholas Biddle, a trained financier and strong-willed aristocrat, who put little faith in popular elections and plebiscites, was the head of the Bank, and all the presidents and directorates of the subordinate banks were his appointees; he controlled absolutely all the departments and all the directors of the parent bank in Philadelphia, going so far in 1833 as to deny the government directors their lawful right to attend the board meetings. There has never been another financial leader in the United States who was so powerful or so much feared as was Nicholas Biddle in 1833.

Both sides prepared for a renewal of the struggle for or against a new charter. Jackson sent Secretary of State Livingston as Minister to France early in 1833, and transferred Secretary McLane from the Treasury to the State Department. It was known that both Livingston and McLane opposed the President in his plan of overthrowing the Bank, and this shift was made to avoid another break-up of the Cabinet and to enable Jackson to get a Secretary of the Treasury who would support him. William J. Duane, of Pennsylvania, accepted the vacant portfolio in January, 1833, knowing well the President's purpose, which was to withhold from the Bank the federal deposits. Agents were sent out to ascertain what state banks were in a condition to receive the proposed government funds, and of course a strong banking support was thus secured for the contemplated policy.

Biddle laughed at Jackson's message of 1832 which denounced the Bank. He expected to receive from Congress in due time the charter which the President had denied. More than fifty members of that body, including Clay, Webster, George McDuffie,--Calhoun's ally and the chairman of the House Committee on Ways and Means,--and the famous Davy Crockett, were borrowers from the Bank on the easiest of terms. The greater newspaper editors of New York, Philadelphia, Baltimore, Washington, and Richmond were either opposed to the President or on Biddle's list of beneficiaries; while scores of hack writers all over the country received their stipends from the "Monster," as Jackson designated the Bank. It might have been an easy matter for Biddle and Clay to secure their charter from the Congress which sat in its closing session in the winter of 1833. But the great thing before them at that time was the nullification-tariff problem, which threatened civil war, and the friends of the Bank joined the protectionists and, under Clay's deft leadership, as we have seen, defeated Jackson's plan for tariff reform. The short session drew to a close, and Biddle, Clay, and Webster prepared for renewing their fight when Congress came together in December.

When the lines began to tighten in the summer of 1833, Duane weakened and finally refused to withhold the government deposits from the Bank. He was dismissed from office and Roger B. Taney, the Attorney-General, took the vacant place and agreed to do Jackson's bidding. From October 1, 1833, the income of the Treasury was placed as it accrued in the custody of the state banks which had been made ready for the new policy. Jackson declared that the National Bank had become unsafe and therefore an unfit place for the keeping of $10,000,000 of the people's money, the amount then on deposit. But the real reason of the change was social and political. The President desired to weaken the Bank, lest its representatives, its masterful lobbyists, and the financial pressure it was bringing to bear should wrest from Congress a charter which the people had repudiated.

Meanwhile Biddle had begun his campaign to compel both Jackson and the people to yield. On August 1, two months before the Treasury began to place its receipts in the state banks, Biddle ordered a curtailment of the loans of the National Bank and its branches. In the South and West, where large sums were needed at that moment to move the cotton and grain crops, the curtailment was double that of the East. This led to immediate financial stringency; National Bank notes, the standard money of the time, became scarce; and gold or silver was absolutely wanting. The state banks were naturally forced to withhold their accustomed loans and the anticipated government deposits could not be drawn upon. Business failures became frequent and laborers were discharged. It was a panic in the midst of prosperity. The program was executed with callous heartlessness by Biddle, and with the approval of men like Clay and Webster, till Congress met in December.

The people were beginning to see what a power they had attacked. Rates of interest rose from six to fifteen per cent; farms and crops were sold under the sheriff's hammer at absurdly low prices. The outlook was anything but bright when the next annual message of the President called upon the national legislature to aid him in his struggle. Petitions were pouring into Washington by the thousand, and delegations of business men appeared almost daily at the White House, asking Jackson to restore the deposits and surrender to the great corporation, thus acknowledging the subordination of the country to one of its interests.

Under these circumstances and awaiting confidently the effect of the Bank's drastic pressure upon public opinion, Clay began in January, 1834, the work of compelling the President to restore the deposits. For weeks and even months the Senate was the scene of the most extraordinary denunciations, and the press of the country was burdened with the attacks and counter-attacks of the parties to this fierce and unrelenting struggle. In the East business failures, the closing of the doors of manufacturing establishments, and the discharge of small armies of employees furnished all the proof necessary that the distress was real. From all sections of the country cries of distress, memorials, and petitions came up to Washington. Biddle and his friends had no thought of relenting, but continued the curtailment of the financial business of the country far beyond what might have seemed necessary on account of the removal of deposits; they were certain that only a few months more of pressure and of increased suffering on the part of the people would compel Jackson to yield or Congress to grant the desired charter over the head of the President.

But the Congress which was elected in 1832 and which sat from December, 1833, to March, 1835, was not so pliable as that which arranged the peace with South Carolina. Still, the Senate sustained the Bank by a decided majority, and in March it formally censured Jackson for his removal of the deposits. In this Clay was conspicuous, and Webster and Calhoun were his sympathetic allies. On the other hand, Benton, Silas Wright, of New York, and John Forsyth, of Georgia, made a most spirited defense of Jackson and of the cause of the people, as they insisted. In the House the situation was reversed, and all Biddle's energy and resolute lobbying failed to secure a favorable vote. It became clear early in the spring that the President could not be moved, and that impeachment, which had been the hope and talk of many, would be impossible. When the weight of public opinion inclined visibly to the side of Jackson at the end of spring, Clay, who had for some time doubted the loyalty of Biddle, and who was especially anxious to regain his former popularity in the West, refused to continue the fight; Webster, too, lost interest and advised the directors of the Bank that the cause was lost. Calhoun, who had supported Clay and Webster to humiliate Jackson, could not retreat; he was again isolated, and he felt his position bitterly. McDuffie resigned his seat and his chairmanship in the House in utter disgust. To all but the president of the United States Bank the case seemed hopeless when Congress adjourned in early summer without passing any act bearing on the situation. Biddle's remark in a letter to a friend in Baltimore, "If the Bank charter were renewed or prolonged, I believe the pecuniary difficulties of the country would be immediately healed," shows his attitude; and by this time the people seem to have come to the conclusion that it was not a war of Jackson upon the Bank so much as a war of the Bank upon the country to compel the reissue of a charter which was about to expire. Petitions now poured into Biddle's office and delegations from Middle States cities urged a change of the Bank's policy; even Albert Gallatin, long a defender and ardent friend, deserted Biddle. And at last, after the nation's currency of some hundred millions had been reduced by one third, and when money rates in New York were running as high as twenty-four per cent, the order went out to the branch banks to suspend the stringent punitive measures in order that "We may save our beloved country from the curse of Van Burenism," as one of the directors described it.

The decline of the power of the Bank was now rapid. In the state and congressional elections of 1834 the President of the United States was everywhere sustained, even the Whigs quietly taking the same ground. The friendship of the Bank was now enough to damn any party; Biddle realized the danger of his situation, and on election day sent his family out of town and barricaded his house and office. The legislatures of Pennsylvania and New York, where his flag had flown triumphantly for years, denounced him and planned to issue bonds for the relief of the people. The autumn saw a complete reversal of policy on the part of the Bank, and business at once resumed its normal course. Money became easy, prices rose to the former level, and the wheels of industry began to turn. Nothing seemed more conclusively shown than that most of the trouble had been due to the demand on the part of a few men for a continuation of financial privileges.

Jackson's first great victory was won, and he would have been more than human not to have shown his sense of triumph on the reassembling of Congress at the end of the momentous year. The Monster had been crushed; and all his great enemies--Clay, Webster, Adams, and Calhoun--had been beaten!

Before the first break in the Cabinet Jackson had proved the value of direct and simple methods in diplomacy. In colonial times and during the operation of the Jay Treaty the West India trade was most important. From New England and the Middle States fish, lumber, grain, and other plantation supplies had been sold to the West India planters in great quantities. The war of the Revolution curtailed this trade; that of 1812 practically destroyed it, and England thereafter refused to allow American shipping any rights in these possessions, though Adams and Clay had urged the reciprocal benefits of such a commerce.

The Jackson Administration succeeded in securing almost immediately the desired trade arrangements, and the shipping of the Chesapeake Bay, of Boston and New York, took its wonted course. This victory was hardly scored before the new President secured from France formal treaty recognition of the old spoliation claims arising from the depredations of Napoleon I, which no former administration had been able to collect. In 1831 the Government of Louis Philippe agreed to pay these damages to the amount of 25,000,000 francs. But the French legislature delayed to vote the necessary appropriations. Jackson, assuming that the obligations would be met promptly, drew upon the French treasury for the first installment and asked the National Bank to collect the bills--somewhat over $900,000. The papers were duly presented in Paris, but they were dishonored. This happened in 1833, when the Bank was in the midst of the fight on the President. Biddle, without hesitation, charged the Government $15,000 for the damage to the reputation of the Bank because the draft had been dishonored in Paris. The Government refused to pay the claim, and a lawsuit of ten years followed which was finally decided against the Bank.

It was at this juncture that Jackson, preparing for the removal of the deposits, sent Secretary Livingston to France to urge the execution of the treaty of 1831. Livingston failed to convince the French assembly that it was necessary either to pay the overdue claims or to execute certain reciprocity clauses of the treaty. In December, 1834, when the Bank crisis had passed, the President sent to Congress a message which asked for the passage of an act authorizing reprisals on French shipping or other property. Such a warlike proposition, with the explanation which accompanied it, aroused the country. In commercial centers there was great excitement, and insurance companies changed their contracts in expectation of war.

Once more the President was opposed and denounced in the Senate as a reckless Executive who would rush headlong into war. But the treaty with France authorized just such procedure as had been suggested, and only recently France had taken the same course with other countries. It soon became so clear that Jackson was within his rights and that the country was behind him, that resolutions were suffered to pass the Senate virtually approving this part of the message. In the House the vote indorsing the Executive was unanimous, though it was not thought advisable to do more than this until there had been ample time for reconsideration of the subject in France.

The strong language of the President aroused a storm of criticism in France, and for a time war was threatened. The French Minister in Washington was recalled, and of course the diplomatic representative of the United States in Paris was withdrawn. The conservative press of Europe made this another occasion for ridiculing the Yankee Republic, whose money-making propensities should be curtailed and whose gaudy wares and vulgar rocking-chairs should be tabooed everywhere. "Let the French navy sweep the Atlantic Ocean of their ships and again take possession of Louisiana" was the unfriendly advice of certain English journals. Before the summer of 1835 closed, all relations between France and the United States had ceased, though actual war was not expected. When Congress met, Jackson reviewed the situation in a calm manner and gave every opportunity for the reopening of negotiations, though warlike preparations were recommended to meet those of France. But England tendered her friendly offices, and the difficulty was promptly brought to a satisfactory conclusion by the payment of the indemnity so long due.

More interesting and more important to the West and South was the stern and persistent policy of Jackson in removing the Indians from their fertile lands. From Michigan the natives were pushed into Wisconsin and Illinois, where they rested a few short years, only to be driven in 1833 beyond the Mississippi to the western parts of Iowa and Minnesota, against the heroic struggles of Black Hawk and a handful of followers. From the lower South the Creeks, Cherokees, Choctaws, and Chickasaws were gradually removed during the years 1830 to 1838, sometimes after the most shameless and brutal treatment by the representatives of both the States and the Nation. Before Jackson came to office the Creeks of western Georgia had been browbeaten into sales of their lands and then removed to the region beyond Arkansas, to be known thereafter as the Indian Territory. In 1833 to 1835 the Choctaws and Chickasaws of Mississippi were defrauded of their best lands and carried forcibly to the new Indian country; but the most arbitrary part of the governmental policy was the expulsion of the Cherokees from their beautiful hills in northern Georgia. Thirteen thousand in number, civilized and devotedly attached to their homes, these people insisted on remaining and becoming a State to themselves. Under the leadership of John Ross, they presented the case to the United States Supreme Court, which decided in 1830 that they composed a nation and that they could not lawfully be compelled to submit to Georgia. The people of Georgia would not for a moment consider such a proposition, and moreover they had made up their minds that the Cherokees must likewise give up their lands and migrate to the Far West. Jackson took this view, and in December, 1835, he made a treaty with some of the chiefs whereby the Cherokees were to receive new lands in the Indian Territory and more than five millions in money. This treaty was at once denounced and repudiated by the majority of the Indians, but the government agents executed it, and during the next three years the helpless natives were hunted down and carried, all save a small remnant, to the new region. Thus President Monroe's plan of settling the natives beyond the western frontier in Minnesota, Iowa, Kansas, and what is now Oklahoma, was worked out, and the land-hungry Western settlers were fast following them into their distant homes; but practically all the lands east of the great river were open to settlement, and Wisconsin, Illinois, Alabama, and Mississippi rapidly became populous communities.[4] No measure of Jackson's Administration won him greater popularity than that of the removal of the Indians.

[Footnote 4: Compare maps showing Indian lands of 1830 and 1840 on pp. 26 and 88.]

[Illustration: Growth of the West and removal of Indians from Cotton, Tobacco and First "Western" Grain Belts. Reproduction of part of Tanner's Map of 1840]

With the tariff question "definitely" settled, the internal improvements demands temporarily in abeyance, the Bank "out of the way," and with a growing prestige both at home and abroad, Jackson might now have formulated the other Western ideals, free homesteads, the re-claiming of Texas, and the occupation of Oregon. But this was all left to Van Buren, the man already practically chosen to carry forward the policies of the "old hero." However, without a free homestead law or even a preëmption system, on which Benton had long insisted, the West was filling up with people in an unprecedented manner. The population of Alabama was only a little more than a hundred thousand in 1820; in 1835, it was not less than half a million. Mississippi counted seventy-five thousand in 1820; in 1840, its population had increased sixfold. The same story was told by the statistics of Indiana, Illinois, Michigan, Wisconsin, and Iowa. There was life, vigor, and rapid growth in all the accessible parts of the region which worshiped the President. Jackson's election was an advertisement of the West; the long debates in Congress about checking emigration to the Mississippi Valley increased the desire to go to the new and happy country; and the hard times of 1833-34 set thousands of men upon the highways leading to the promised land. And in the Western States every effort was made to attract people. Ohio, Indiana, and Illinois built waterways which should feed the Mississippi or Erie Canal commerce, and thus make Western life profitable as well as free and unconventional. Where canals could not be constructed would go the great government road, passing through Ohio, Indiana, and Illinois, and its state-built branches. Even railroads were projected in that far-off country. In the Southwest the network of rivers offered transportation facilities to the increasing crops of cotton, and ambitious men flocked there to "make fortunes in a day." Sargent Prentiss, the poor New England cripple, went to Mississippi about 1830, and in six years he was both rich and famous; John A. Quitman, the preacher's son, of New York, worked his way about the same time to the lower Mississippi country, and in a few years was receiving an annual income of forty thousand dollars. John Slidell left New York City a bankrupt in 1819, but soon became a great lawyer and slave-owner in New Orleans.

The yearly migration of thousands of Eastern men to the valley of the Mississippi was still further augmented by streams of refugees from the unsettled and distressed conditions of Germany. In Ohio, Kentucky, southern Illinois, and Missouri these idealistic emigrants from Europe found new homes and substantial encouragement. They sent glowing accounts of the new world to their friends at home, and the tide of immigration which was destined to enrich American life steadily increased. All this stimulated speculation in Western lands, in canal and banking ventures. The Government sales of lands rose from $4,837,000 in 1834 to $24,000,000 in 1836. And the canal schemes of Ohio, Indiana, and Illinois found financial support in New York and in London. No wonder the eastern manufacturers sometimes desired to close the roads that crossed the Alleghanies.

"Nothing succeeds like success" is an American saying which applies admirably to Jackson's second administration. The Western President had won all his great contests; Calhoun and the radical South had been tamed; Clay and Webster were dragged behind his car of state; the National Bank was rapidly passing from the political stage; and the tariff was no longer a troublesome factor in public life. The receipts of the Treasury had steadily outrun the expenses, and in 1834 the last of the national debt was paid. Since the income was almost certain to continue great, Jackson was at a loss what to do. Henry Clay urged a simple distribution among the States. The President feared the effect of this, and vetoed a bill to that effect; he even proposed that the Federal Government should buy stock in all the railway corporations in order that these growing monopolies be duly restrained. After two years of disagreement a law was enacted which offered to deposit the surplus with the States without interest charges, but subject to recall. The States hastened to make the necessary arrangements, and during the second half of 1836 and the first quarter of 1837 more than $18,000,000 were thus deposited.

The land speculations, already at fever heat in the West, the building of railways and canals, and the prospective distribution of millions of the public money warned the wise that sail must be taken in, else disaster would ensue. Jackson, therefore, issued an executive order in July, 1836, requiring the land offices to accept only specie in payment for lands; but it was not thought that this would occasion any great distress. The people seemed to be satisfied with the "reign" of Andrew Jackson, and it might have been expected that he would have little difficulty in placing his friend Van Buren in the high office so soon to be vacated.

[Illustration: The Presidential Election of 1836, the Popular Vote by Counties]

It did not prove so easy as it seemed. Calhoun and his followers were still hostile. In Tennessee, Hugh Lawson White was heading a serious revolt against Jackson and all his party, and of course New England was still dissatisfied. Since the great fight between the President and the Bank in 1833-34, Henry Clay had been welding together all the forces of the opposition. States-rights men in the South, like John Tyler, of Virginia, and William C. Preston, of South Carolina, the conservative forces in the Middle States who were connected with banking and "big business," and the internal improvements forces of the West that were still discontented, were all united in a more or less cohesive party of opposition. A platform they could not risk; in fact, platforms were not as yet necessary for election, nor was it thought best to nominate a single pair of candidates and submit their case to the country. The Whigs, as the opposition now came to be called, arranged a ticket which Daniel Webster led in the East, which William Henry Harrison, a popular military hero of the Northwest, headed in that section, and which Hugh Lawson White, a Jackson man till 1834, championed in the Southwest. There followed a four-cornered contest which resulted in the choice of Van Buren by a popular majority of less than 30,000. Van Buren carried more of the New England States than did Webster and more of the South than did White, but he lost most of the West, even Tennessee, which had been the stronghold of his party. The counties of the old South where Jackson had been most feared gave their votes to Van Buren, the "safe and sane"; and many New England and Middle States manufacturers preferred to take their chances with a masterful organizer of conservative temper, who had been the balance wheel of the Jackson Administration, to risking all in an election in the House of Representatives, where the sections would be fighting fiercely for political and party advantages. The new régime of 1829 was thus about to be turned into a reaction. There was a common feeling that Van Buren would do nothing "radical." Even Calhoun thought better of the President-elect than he thought of the "old hero," and the first six months of the new Administration had not passed before he gave the President his support.

The political sun of Jackson went down brightly, not a cloud on the horizon; and his chosen successor declared openly in his inaugural that he would gladly follow in "the footsteps of his illustrious predecessor." The country was still prosperous and the wheels of industry were running at full speed. Foreign Governments looked on with envy as the young Western Republic stretched her limbs and rose to gigantic proportions.

Bibliographical Note

The most important book on the bank question is R. C. H. Catterall's _The Second Bank of the United States_ (1903). The biographies referred to at the close of chapter _IV_ of this volume are all serviceable in general till about 1840. James Schouler's _History of the United States_ (1894-99), vol. _IV_, and H. von Holst's _Constitutional and Political History of the United States_ (new ed., 1899), vol. _II_, give full narratives of the "war on the bank." J. Q. Adams's _Memoirs_ are ever ready with the spice of personality to make its pages readable. _The Register of Debates_, the official publication of Congress which succeeded the former _Annals of Congress_ and _Niles's Weekly Register_, published in Baltimore from 1811 to 1849, give the various phases of public opinion as it was expressed in Congress and in the newspapers of the time. _House Reports_, 22d Cong., 1st Sess., no. 460, and _House Executive Documents_, 23d Cong., 1st Sess., no. 523, will satisfy those who seek to know the two sides as viewed by the parties to the conflict. There is no satisfactory biography of Nicholas Biddle, though his papers may be consulted in the Pennsylvania Historical Society Library. R. G. Wellington's _The Political and Sectional Influence of the Public Lands, 1828-1842_ (1914) tends to show how much of the controversies of these years was due to sectional jealousy.