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 1 st 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