Source: H.W. Brands. Heirs of the Founders (2017)
It proved to be the 2nd National Bank of the United States, the third pillar of Clay’s American System, that would be the battleground between Clay and Jackson as the Election of 1832 approached. Clay’s support of the BUS (Bank of the US) was public, steadfast, and longstanding, while Jackson’s opposition was well-known, but recent. The President of the BUS, Nicholas Biddle, had spent years trying to educate Americans on the workings and benefits of banks, and now he tried to do the same with Jackson.
Biddle had done his best to stay out of the political area and to keep his focus on the financial systems of the nation. If Biddle saw Jackson has uneducated in banks, Clay saw Biddle as naive in terms of politics, and Clay set out teach Biddle the ways of DC. The charter of the BUS was set to expire in 1836, and Jackson was intent on allowing the charter to run out. But the investors and customers of the BUS wanted reassurance that the institution would last beyond 1836, which led to support for an early renewal of the charter.
Biddle had done his best to stay out of the political area and to keep his focus on the financial systems of the nation. If Biddle saw Jackson has uneducated in banks, Clay saw Biddle as naive in terms of politics, and Clay set out teach Biddle the ways of DC. The charter of the BUS was set to expire in 1836, and Jackson was intent on allowing the charter to run out. But the investors and customers of the BUS wanted reassurance that the institution would last beyond 1836, which led to support for an early renewal of the charter.
In 1830, Clay counseled patience in regards to the charter’s early renewal, in large part because at that point Jackson hadn’t decided on running for a 2nd term. Clay told Biddle that pushing for an early renewal during the Campaign of 1832 might play into MVB’s hands, so the best strategy was to wait until after the election. But the general rise of the propaganda campaign in support of the BUS continued, and Congress appeared to be in support of the renewal. And then Jackson decided to run again in 1832, and Biddle now saw that patience was not a virtue in order to save the BUS, and Clay had reached that very same conclusion as well. To Clay and Biddle, the only hope was to press for the renewal of the BUS before the Election of 1832.
Clay thought he could manage the renewal through Congress, and even though Jackson would veto the bill, the BUS would become an even greater campaign issue, and perhaps Jackson’s veto might cost him re-election. It was Clay’s only hope since Jackson looked to be virtually unbeatable, so getting Jackson to veto the BUS bill might not only politically damage Jackson, but his veto might create an anti-Jackson coalition that would support Clay. Clay didn’t show all his cards to Biddle, especially his knowledge of how Jackson would react to being openly challenged during the campaign.
Clay thought he could manage the renewal through Congress, and even though Jackson would veto the bill, the BUS would become an even greater campaign issue, and perhaps Jackson’s veto might cost him re-election. It was Clay’s only hope since Jackson looked to be virtually unbeatable, so getting Jackson to veto the BUS bill might not only politically damage Jackson, but his veto might create an anti-Jackson coalition that would support Clay. Clay didn’t show all his cards to Biddle, especially his knowledge of how Jackson would react to being openly challenged during the campaign.
Senator Daniel Webster's interest in the BUS was different from Clay, but just as intense. Biddle paid Webster for legal work, which in effect meant that Biddle kept Webster on retainer as an advisor concerning the politics of the BUS. Webster kept speaking in the Senate on behalf of the BUS, and Biddle kept him on a retainer. Webster made it clear to Biddle that the retainer needed to remain ongoing. Webster told Biddle that there was strong support for the BUS renewal, and that it would be wise to start the process right away. So, on the separate advice from Clay and Webster, Biddle took the fateful step of starting the renewal of the charter of the 2nd National Bank of the United States in early-1832.
Webster congratulated Biddle on his decision to do so and did his best to get the bill through the Senate. The enemies of the BUS were galvanized, and Senator Thomas Hart Benton (MO) called the BUS unconstitutional, immoral, and a conspiracy. Benton’s tirade played well in the West and among the vast majority of Jacksonians. However, Clay was able to get the votes in both houses to renew the charter of the BUS. The margin was comfortable in the House, but in the Senate is was a close call, which led to charges of bribery and shenanigans by the opponents of the BUS.
Webster congratulated Biddle on his decision to do so and did his best to get the bill through the Senate. The enemies of the BUS were galvanized, and Senator Thomas Hart Benton (MO) called the BUS unconstitutional, immoral, and a conspiracy. Benton’s tirade played well in the West and among the vast majority of Jacksonians. However, Clay was able to get the votes in both houses to renew the charter of the BUS. The margin was comfortable in the House, but in the Senate is was a close call, which led to charges of bribery and shenanigans by the opponents of the BUS.
All the while Jackson knew he was being “set up”. As far as Jackson was concerned, he hadn’t picked the fight; Clay was the aggressor seeking political gain. Jackson was not going to back down in the slightest way, and he vetoed the renewal bill, and he sent Congress a stern message why he had done so. Jackson argued that the BUS was unconstitutional. To Jackson, Marbury v. Madison (1803) and
McCulloch v. Maryland (1819) only meant that the lower courts had to follow the Supreme Court decisions, not Congress. Jackson stated that each branch of the government could have its own interpretation of the Constitution.
Jackson simply didn’t believe that the “necessary and proper” clause authorized a national bank. In Jackson’s time, the precedent and practice of judicial review in the hands of the Supreme Court hadn’t yet been set in stone. Jackson’s statements against the BUS were bold, but not original. Jackson went on to say that the BUS was a monopoly that enriched its shareholders at the expense of regular Americans, which aggravated the nation’s inequalities.
McCulloch v. Maryland (1819) only meant that the lower courts had to follow the Supreme Court decisions, not Congress. Jackson stated that each branch of the government could have its own interpretation of the Constitution.
Jackson simply didn’t believe that the “necessary and proper” clause authorized a national bank. In Jackson’s time, the precedent and practice of judicial review in the hands of the Supreme Court hadn’t yet been set in stone. Jackson’s statements against the BUS were bold, but not original. Jackson went on to say that the BUS was a monopoly that enriched its shareholders at the expense of regular Americans, which aggravated the nation’s inequalities.
Webster knew the veto was coming, but he still appeared to be shocked, telling many that Jackson’s veto defied logic, law, and reason; in effect, Webster argued that Jackson had said, “I am the state”. Biddle was not surprised by the veto at all, but he wasn’t discouraged. Biddle felt that Jackson had cooled himself out of business with his veto message to Congress. Biddle also thought the veto would benefit Clay, who Biddle believed was the instrument of survival for the BUS. Clay however, understood that Jackson’s veto had solidified anti-Jackson sentiment in the predictable places, but among the growing number of “Average American” populist voters, the veto could do nothing but help Jackson.
1832 marked the first year of political party nominating conventions, and the Anti-Masons were first, nominating Maryland’s William Wirt (what Clay had done in terms of revolutionizing the role of Speaker, Wirt had done with the Cabinet post of Attorney General). The idea of a convention caught on, with the National Republicans nominating Clay . . . the Democrats (nee Republicans), had officially started to fracture apart. A convention of Jacksonians (now calling themselves Democrats for the first time), officially, nominated Jackson as President and MVB as VP. The
Election of 1832 was not close, with Jackson tallying 219 Electoral Votes to Clay’s 49, and Jackson won 16 states to Clay’s 6 (Wirt carried one state, and a Nullification candidate carried South Carolina).
1832 marked the first year of political party nominating conventions, and the Anti-Masons were first, nominating Maryland’s William Wirt (what Clay had done in terms of revolutionizing the role of Speaker, Wirt had done with the Cabinet post of Attorney General). The idea of a convention caught on, with the National Republicans nominating Clay . . . the Democrats (nee Republicans), had officially started to fracture apart. A convention of Jacksonians (now calling themselves Democrats for the first time), officially, nominated Jackson as President and MVB as VP. The
Election of 1832 was not close, with Jackson tallying 219 Electoral Votes to Clay’s 49, and Jackson won 16 states to Clay’s 6 (Wirt carried one state, and a Nullification candidate carried South Carolina).
To Jackson, Clay was despicable and corrupt, and that was that; not even his compromise concerning the Tariff of 1828 made a dent on Jackson’s negative opinion. The battle over the BUS continued into Jackson’s 2nd term. Clay and Biddle hoped to salvage something from the crisis that they knew they had created, thinking that if somehow the BUS outlasted Jackson, it would survive. But Jackson was determined to strike first and deliver the crushing blow to the BUS.
Jackson calculated that the BUS would collapse if he
removed government deposits. Jackson had to remove SecTreas William Duane, who refused to remove the deposits, and moved Roger Taney (Attorney General) in as Acting SecTreas to do so. Biddle was neither alarmed nor surprised, knowing that the crisis would come to exactly that point. Biddle believed that he held the advantage using strategic bribes to keep the people in the BUS system that would not cooperate with Jackson’s goal of removing the deposits. At the same time, Biddle ordered the BUS to call in loans and to stop issuing loans. Biddle’s idea was that he would starve the economy of the money it needed to flourish; in essence, Biddle tried to show that the US could not possibly survive without the BUS.
Jackson calculated that the BUS would collapse if he
removed government deposits. Jackson had to remove SecTreas William Duane, who refused to remove the deposits, and moved Roger Taney (Attorney General) in as Acting SecTreas to do so. Biddle was neither alarmed nor surprised, knowing that the crisis would come to exactly that point. Biddle believed that he held the advantage using strategic bribes to keep the people in the BUS system that would not cooperate with Jackson’s goal of removing the deposits. At the same time, Biddle ordered the BUS to call in loans and to stop issuing loans. Biddle’s idea was that he would starve the economy of the money it needed to flourish; in essence, Biddle tried to show that the US could not possibly survive without the BUS.
Clay was not surprised at Jackson’s decision to remove government deposits from the BUS, but he was appalled. Clay formally asked the Senate to censure the President. In a speech on the Senate floor, Clay asserted that Jackson’s actions were a move to grab more power. Most of the Senators enthusiastically agreed with Clay, and Vice-President MVB (like VP Calhoun had tried to do after Webster’s spellbinding floor speech) tried to use his gavel to lessen the impact of Clay’s speech.
Calhoun joined Clay in opposition to Jackson’s attempt to remove government deposits. Benton believed that Jackson was in the right, since he also distrusted banks. From the moment the deposits were removed, Benton observed that the BUS and Biddle were doing their best to create a crisis that would be to their advantage, especially Biddle’s squeeze on the money supply and credit. Jackson concluded that the shenanigans of the BUS were due to Clay and Biddle, and he viewed it as a personal challenge in that it was either his Presidency or the BUS. Jackson held Biddle responsible for the tactics, but he held Clay responsible for the overall strategy.
Calhoun joined Clay in opposition to Jackson’s attempt to remove government deposits. Benton believed that Jackson was in the right, since he also distrusted banks. From the moment the deposits were removed, Benton observed that the BUS and Biddle were doing their best to create a crisis that would be to their advantage, especially Biddle’s squeeze on the money supply and credit. Jackson concluded that the shenanigans of the BUS were due to Clay and Biddle, and he viewed it as a personal challenge in that it was either his Presidency or the BUS. Jackson held Biddle responsible for the tactics, but he held Clay responsible for the overall strategy.
