States Rights and the Economy

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States Rights and the Economy Chapter 10 ~ Section 5 States Rights and the Economy

The Bank War 1816-1830’s: Bank support was high with business people; business loans, safe place to keep money, currency was stable Americans did not trust Banks  restricted loans, felt that the bank was responsible for economic crash of 1819. Andrew Jackson dislike bank  called it “The Monster”  wealthy got rich off ordinary people, and he disliked bank president (Nicholas Biddle)

States Rights 10th Amendment Balancing federal and states powers Any powers not specified to federal government and powers under the states Balancing federal and states powers Alien & Sedition Acts Virginia & Kentucky resolutions Hartford convention

Nullification Crisis 1828: new tariff on iron, textiles, and other products  good for North and West, but not for the South States had right to nullify the law (John C. Calhoun) For South - if federal government could enforce unjust law, could they end slavery? John C. Calhoun said our union grew from agreement between states, and those states kept certain powers (one was nullification)

Nullification Crisis People against nullification – US was not formed by states, but by people, so the union must be preserved 1832: South Carolina nullified tariff on iron and textiles, saying it did not apply to them  they threatened to leave the union if forced to pay tariff  Jackson got mad and sent troops to SC  Calhoun stepped down as Vice Pres.

End of the Jackson Era Jackson served two terms  followed by Martin Van Buren 1836: Whigs had 3 candidates, each from different regions  wanted to prevent any candidate from majority of electoral votes and have it go to the House of Rep. to decide president  did not work  Van Buren elected for second term

End of the Jackson Era Economy was going down  British buying less cotton  cotton prices fell  banks couldn’t collect loans from farmers, and went out of business  economy collapsed  Panic of 1837 (lasted six years) Election of 1840: William Henry Harrison (Whig) vs. Van Buren  Harrison won

VOCABULARY NULLIFICATION An action by a state that cancels a federal law to which the state objects

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