Beacon Lights of History, Volume 12: American Leaders

by John Lord

The removal of more than nine millions from the Bank within the period of nine months caused it necessarily to curtail its discounts, and a financial panic was the result, which again led to acrimonious debates in Congress, in which Clay took the lead. His opposition exasperated the President in the highest degree. Calhoun equalled Clay in the vehemence of his denunciation, for his hatred of Jackson was greater than his hostility to moneyed corporations. Webster was less irritating, but equally strong in his disapproval. Jackson, in his message of December, 1833, reiterated his charge against the Bank as "a permanent electioneering engine," attempting "to control public opinion through the distresses of some, and the fears of others." The Senate passed resolutions denouncing the high-handed measures of the government, which, however, were afterwards expunged when the Senate had become Democratic. One of the most eloquent passages that Clay ever uttered was his famous apostrophe to Vice President Van Buren when presiding over the Senate, in reference to the financial distress which existed throughout the country, and which, of course, he traced to the removal of the deposits. Deputations of great respectability poured in upon the President from every quarter to induce him to change his policy,--all of which he summarily and rudely dismissed. All that these deputations could get out of him was, "Go to Nicholas Biddle; he has all the money." In 1834, during the second term of Jackson's office, there were committees sent to investigate the affairs of the Bank, who were very cavalierly treated by Biddle, so that their mission failed, amid much derision. He was not dethroned from his financial power until the United States Bank of Pennsylvania--the style under which the United States Bank accepted a State charter in 1836, when its original national charter expired--succumbed to the general crash in 1837.

It is now generally admitted that Jackson's war on the Bank was violent and reckless, although it would be difficult to point out wherein his hostility exceeded constitutional limits. The consequences were most disastrous to the immediate interests of the country, but probably not to its ultimate interests. The substitution of "pet banks" for government deposits led to a great inflation of paper money, followed by a general mania for speculation. When the bubble burst these banks were unable to redeem their notes in gold and silver, and suspended their payments. Then the stringency of the money market equalled the previous inflation. In consequence there were innumerable failures and everything fell in value,--lands, houses, and goods. Such was the general depression and scarcity of money that in many States it was difficult to raise money even to pay necessary taxes. I have somewhere read that in one of the Western States the sheriffs sold at auction a good four-horse wagon for five dollars and fifty cents, two horses for four dollars, and two cows for two dollars. The Western farmers were driven to despair. Such was the general depression that President Van Buren was compelled in 1837 to call an extra session of Congress; nor were the difficulties removed until the celebrated Bankrupt Law was passed in 1840, chiefly through the efforts of Daniel Webster, which virtually wiped out all debts of those who chose to avail themselves of the privilege. What a contrast was the financial state of the country at that time, to what it was when Jackson entered upon his administration!

It is not just to attribute all the commercial disasters which followed the winding up of the old United States Bank to General Jackson, and to the financial schemes of Van Buren. It was the spirit of speculation, fostered by the inflation of paper money by irresponsible banks when the great balance-wheel was stopped, which was the direct cause. The indirect causes of commercial disaster, however, may be attributed to Jackson's war on the Bank. The long fight in Congress to secure a recharter of the Bank, though unsuccessful, was dignified and statesmanlike; but the ungoverned passions displayed by the removal of deposits resulted in nothing, and could have resulted in nothing of advantage to any theory of the Bank's management; and it would be difficult to say who were most to blame for the foolish and undignified crimination and recrimination which followed,--the President, or the hostile Senate. It was, at any rate, a fight in which Jackson won, but which, from the animosities it kindled, brought down his gray hairs in sorrow to the grave. It gave him a doubtful place in the history of the nation.

If Jackson's hostility to the United States Bank was inexpedient and violent, and resulted in financial disasters, his vigorous efforts to put down Nullification were patriotic, and called forth the approval and gratitude of the nation. This was a real service of immense value, and it is probable that no other public man then on the stage could have done this important work so well. Like all Jackson's measures, it was summary and decided.

Nullification grew out of the tariffs which Congress had imposed. The South wanted no protective duties at all; indeed, it wanted absolute free trade, so that planters might obtain the articles which they needed at the smallest possible cost, and sell as much cotton and tobacco as they could with the least delay and embarrassment. Professor Sumner argues that Southern industries either supported the Federal government, or paid tribute to the Northern manufacturers, and that consequently the grievances of the Southern States were natural and just,--that their interests were sacrificed to national interests, as the New England interests had been sacrificed to the national interests at the time of the Embargo. Undoubtedly, the South had cause of complaint, and we cannot wonder at its irritation and opposition to the taxes imposed on all for the protection of American manufactures. On the other hand, it was a grave question whether the interests of the nation at large should be sacrificed to build up the interests of the South,--to say nothing of the great moral issues which underlie all material questions. In other words, in matters of national importance, which should rule? Should the majority yield to the minority, or the minority to the majority? In accordance with the democratic principles on which this government is founded, there is only one reply to the question: The majority must rule. This is the basal stone of all constitutional government, whose disruption would produce revolution and anarchy. It is a bitter and humiliating necessity which compels the intellect, the wealth, the rank, and the fashion of England to yield to the small majority in the House of Commons, in the matter of Irish Home Rule, but an Irishman's vote is as good as that of the son of an English peer. The rule of the majority is the price of political liberty, for which enlightened nations are willing to pay.

Henry Clay deserves great praise and glory for his persistent efforts at conciliation,--not only in matters pertaining to the tariff, but in the question of slavery to harmonize conflicting interests. But Calhoun--the greatest man whom the South has produced--would listen to no concessions, foreseeing that the slightest would endanger the institution with which the interests and pride of the Southern States were identified. At this crisis the country needed a man at the helm whose will was known to be inflexible.

In the session of 1830, on a question concerning the sales of public (U.S.) lands in the several States, arose the great debate between Colonel R.Y. Hayne, of South Carolina, and Daniel Webster on the limitations of Federal power; and Hayne's declaration of the right of a State to nullify a Federal law that was prejudicial to its interests gained him great applause throughout the South. John C. Calhoun, United States Senator from South Carolina, was at the head of the extreme State Sovereignty party, and at a banquet celebrating the birthday of Jefferson, January 13, 1830, he proffered the toast "The Union: next to Liberty, the most dear; may we all remember that it can only be preserved by respecting the rights of the States, and distributing equally the benefit and burden of the Union." Jackson, as President, and practical chief of the Democracy, was of course present at this political banquet. His profound patriotism and keen political instinct scented danger, and with his usual impulse to go well forward to meet an enemy, he gave, "The Federal Union: it must be preserved." This simple declaration was worth more than all the wordy messages and proclamations he ever issued; it not only served notice upon the seceders of his time that they had a great principle to deal with, but it echoed after him, and was the call to which the nation victoriously rallied in its supreme struggle with treason, thirty years later.

Notwithstanding the evident stand taken by the President, the Calhoun party continued their opposition on State lines to the Federal authority. And when Congress passed the tariff of July, 1832, the South Carolina legislature in the autumn called a convention, which pronounced that Act and the Tariff Act of 1828 unconstitutional,--"null and void, and no law;" called on the State legislature to pass laws to prevent the execution of the Federal revenue acts; and declared that any attempt at coercion on the part of the Federal authorities would be regarded as absolving South Carolina and all its people from all further obligation to retain their union with the other States, and that they should then forthwith proceed to organize a separate government, as a sovereign and independent State.

If such a man as Buchanan had then been in the presidential chair there probably would have been a Southern Confederacy; and in 1832 it might have been successful. But Jackson was a man of different mould. Democrat and Southern sympathizer as he was, he instantly took the most vigorous measures to suppress such a thing in the bud, before there was time to concert measures of disunion among the other Southern States. He sent General Scott to Charleston, with a body of troops stationed not far away. He ordered two war-vessels to the harbor of the misguided and rebellious city. On December 4 in his annual message he called the attention of Congress to the opposition to the revenue laws and intimated that he should enforce them. On December 11 he issued a proclamation to the inhabitants of South Carolina, written by Livingston, moderate in tone, in which it was set forth that the power of one State to annul a law of the United States was incompatible with the existence of the Union, and inconsistent with the spirit of the constitution. Governor Hayne issued a counter-proclamation, while Calhoun resigned the vice-presidency in order to represent South Carolina on the floor of the Senate. In January the President sent another message to Congress asking for authority to suppress rebellion.

Congress rallied around the Executive and a bill was passed providing for the enforcement of the collection of the customs at Charleston, and arming the President with extraordinary powers to see that the dangers were averted. Most of the States passed resolutions against Nullification, and there was general approval of the vigorous measures to be enforced if necessary. The Nullifiers, unprepared to resist the whole military power of the country, yielded, but with ill grace, to the threatened force. Henry Clay in February introduced a compromise tariff, and on the 27th of that month it was completed, together with an Enforcement Act. On March 3 it became a law, and on March 11 the South Carolina Nullifiers held an adjourned meeting of their convention and nullified their previous nullification. The triumph of Jackson was complete, and his popularity reached its apex.