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PRIMARY DOCUMENTS  |  The Bank War: Jackson Veto and Webster's Reply, 1832
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Resources:  ACTIVITIES  |  Lesson [PDF]  |  Enrichment & Expansion  |  Afterword & Facts  |  Bibliography

Raucous crowds celebrated Andrew Jackson's inauguration as president in 1829, swarming through the streets of Washington and trashing the White House (at least according to Jackson's appalled opponents). Jackson, born in a log cabin and hailing from the West, symbolized to many a new era in American politics, an era which celebrated the common man and the common man in turn celebrated his election.

Jackson believed that out of all the officials in the federal government, the only one who truly represented all the people was the president. Members of the House of Representatives served only their own districts; senators represented their own states (and were at this time chosen by the state legislatures, not elected directly by the voters); and Supreme Court justices and federal judges were appointed, not elected. As president, then, he felt a special responsibility to protect the people's rights and interests. Jackson also believed that the government should not favor any one person or group over others; that is, it should not favor the few at the expense of the many. This belief contributed to Jackson's decision to veto the re-charter of the Second Bank of the United States, unleashing what came to be called "the Bank War." This lesson will examine Jackson's veto and his opponents' response.


  1. To identify and evaluate the arguments for and against re-chartering the Second Bank of the United States as stated in Andrew Jackson's veto message and Daniel Webster's reply.

  2. To evaluate Jackson's claim to being the "president of the people" by examining his veto of the bill re-chartering the Second Bank of the United States.

»  National History Standards


Alexander Hamilton, the first secretary of the treasury, proposed that Congress charter a national bank which would have branches around the country. Such a bank, he argued, could assist the federal government by providing a safe place to deposit tax money and other revenue, allowing the government to make payments throughout the country, and to market government bonds. Hamilton also believed the bank could play a central role in the economy by printing banknotes which could serve as currency, encouraging trade among the various regions of the nation, and making loans to fledgling industries. In 1791, in response to Hamilton's recommendation, Congress chartered the Bank of the United States, later known as the First Bank of the United States.

Image: Andrew Jackson. White House Collection

Andrew Jackson. White
House Collection
Image: The Second Bank of the United States. Library of Congress

The Second Bank of the United States.
Library of Congress
Image: Daniel Webster. White House Collection

Daniel Webster. White
House Collection

Thomas Jefferson and members of his Democratic-Republican party opposed the Bank for numerous reasons, including a suspicion that it was unconstitutional. The Democratic-Republicans were strict constructionists, arguing that the federal government only had the powers specifically granted to it in the Constitution. Since the Constitution did not specifically state that Congress can charter a bank, the Democratic-Republicans considered the Bank unconstitutional. In 1811, when the Bank's charter was about to expire, the Democratic-Republicans controlled both Congress and the presidency. They decided to allow the Bank's charter to lapse, and the Bank went out of business.

The very next year, the nation became embroiled in the War of 1812. The U.S. government had a hard time selling war bonds and paying military suppliers and soldiers in an orderly fashion. By the end of the war, President James Madison had concluded that a national bank might not be such a bad thing after all. At his urging, Congress in 1816 chartered another Bank of the United States, commonly called the Second Bank of the United States. In the case of McCulloch v. Maryland, the Supreme Court in 1819 affirmed the Bank's constitutionality; Congress, proclaimed the Court, did indeed have the authority to charter a national bank, even though it was not explicitly given that power in the Constitution.

That same year, the country's economic troubles came to a head in the depression known as the Panic of 1819. Economic historians mostly agree that the Second Bank did not play a major role in causing the crisis, but many people at the time blamed the Bank. During the Panic, the Bank called in many loans to protect its own stability, and the financial hardship it caused led to further resentment of the Bank.

Among those who bitterly hated the Bank was Andrew Jackson. He considered it the very embodiment of elite privilege and power. And Jackson was by no means the Bank's only enemy. Those who opposed the bank came from two groups--those favoring "soft money" and those favoring "hard money." The "soft money" advocates disliked the Bank, because it informally regulated the state banks by tightly controlling the money supply, which limited financial opportunity. People in the West, who needed loans for new farms and businesses, particularly resented the Second Bank for this practice, as did investors and other supporters of state banks.

"Hard money" advocates also criticized the Second Bank but for a different reason. They believed that specie--gold and silver coins--was the only safe currency. They thought that no bank, regardless of how well run it might be, should be able to issue bank notes. This was Jackson's position. He had once speculated in a land deal with paper credit, and his business had been ruined. The experience left him suspicious of all banks.

In 1823, as the economy rebounded from the Panic, Nicholas Biddle, an aristocratic Philadelphian, became president of the Second Bank of the United States. He won wide recognition as an excellent and responsible leader for what was, by far, the nation's most important financial institution. At first, Biddle tried to stay out of politics. However, when he saw popular opposition to the Second Bank rising during Jackson's first term as president of the United States, he decided to become active politically to defend the Bank's interests. In particular, he formed an alliance with two powerful senators, Henry Clay and Daniel Webster. Clay and Webster were nationalists who strongly supported the national bank and believed the federal government should be very active in economic matters, even if the Constitution did not specifically grant it that power.

With encouragement from Clay and Webster, Biddle applied for a renewal of the Bank's charter in 1832, although the original charter was not going to expire until 1836. The three men believed the institution enjoyed public support. Since Jackson was running for re-election as president, they reasoned, he might not want to make the Bank an issue and thus would sign the renewal. On the other hand, if Jackson chose to veto it, he would lose support in key states such as Pennsylvania, where the Bank had its headquarters. That would benefit his opponent who happened to be Henry Clay.

Clay, Webster, and Biddle badly misjudged Jackson's reaction. When word got out that Congress was considering re-chartering the Bank, Attorney General Roger B. Taney laid out the situation as he saw it: "Now, as I understand the application at the present time, it means in plain English this--the Bank says to the President, your next election is at hand--if you charter us, well--if not, beware of your power." To Jackson, it sounded like a threat to his presidency and a challenge to his integrity. It was bad enough that the Bank had so much economic influence in the country, but now Biddle was trying to manipulate the presidency for the Bank's benefit. The Bank, said Jackson, was an "undemocratic, hydra monster" that was out of control. As the people's president, Jackson believed he had the responsibility to destroy it. After Congress passed a bill re-chartering the Bank, Jackson exercised his power as president and vetoed it.

For Discussion

Have your students look at a dollar bill. Ask them what they can learn from the front of the bill. What words are on it? Why do we accept this money as having value? (Answer: because it is issued with the backing of the federal government and is legal tender, that is, it must be accepted in payment of debts in this country.) Ask the students to imagine what it would be like if the government didn't issue money and instead any bank could print money. Would they feel as confident of the value of the money? Now tell them that they're going to be looking at a period when, in fact, the government didn't issue money and banks printed it, instead.

Resources:  ACTIVITIES  |  Lesson [PDF]  |  Enrichment & Expansion  |  Afterword & Facts  |  Bibliography

National History Standards

This lesson meets the following national history standards for grades 5-12:

Identify the central question(s) the historical narrative addresses and the purpose, perspective, or point of view from which it has been constructed. (Historical Thinking Standards, Historical Comprehension, Standard 2C).

Evaluate the implementation of a decision by analyzing the interests if served; estimating the position, power, and priority of each player involved; . . . and evaluating its costs and benefits from a variety of perspectives. (Historical Thinking Standards, Historical Issues-Analysis and Decision-making, Standard 5F).

Evaluate national and state policies regarding . . . a national bank. (United States History Standards, Era 4: Expansion and Reform, Standard 2).

Explain how Jackson's veto of the U.S. Bank re-charter . . . contributed to the rise of the Whig Party. (United States History Standards, Era 4: Expansion and Reform, Standard 3).


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