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

• 1st 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