Lesson 2: Political Conflict and Economic Crisis

Question 1

Caucus Definition

Answer 1

a meeting held by a political party to choose their party’s candidate for president or decide policy

Question 2

Daniel Webster Definition

Answer 2

He was a Massachusetts Senator who opposed slavery and supported the Compromise of 1850.

Question 3

Depression Definition

Answer 3

a period of low economic activity and wide-spread unemployment

Question 4

John Calhoun

Answer 4

He was a statesman from South Carolina who held many offices in the federal government, including vice president and U.S. senator. He became a strong supporter of states’ rights. In 1850, he foresaw future conflicts over slavery that would eventually lead to the American Civil War.

Question 5

Martin Van Buren Definition

Answer 5

He was the eighth president of the United States, serving from 1837 to 1841. He was blamed for the Panic of 1837 and the widespread unemployment and poverty that it brought and was not reelected for a second term.

Question 6

Nominating Convention

Answer 6

system in which delegates from the states selected the party’s presidential candidate

Question 7

Nullification Act Definition

Answer 7

an act passed by South Carolina that declared that the Tariff of 1832 unconstitutional

Question 8

States’ Rights Definition

Answer 8

the idea that states have the right to limit the power of the federal government

Question 9

Unemployment Definition

Answer 9

Number of workers who are without jobs.

Question 10

How did the economies of the three regions differ?

Answer 10

The conflict over states’ rights divided the country along regional lines. The United States at the time was made up of three regions. The North included the New England and Middle Atlantic states. Manufacturing and trade were very important to the economy of the North. The West was the region we now know as the Midwest. Its economy was based mainly on farming to raise livestock and food crops. Finally, the South consisted of today’s Southeast and South Central states. The South’s people relied heavily on farming to produce cash crops for export, such as cotton and tobacco.

Question 11

How did the beliefs of the North and the South differ? Where did the West stand on these ideas?

Answer 11

Politically, northerners generally favored a strong federal government, which they saw as necessary to promote manufacturing and trade. Southerners feared the domination of the North and national policies that could hurt southern interests. Consequently, southerners tended to support stronger states’ rights. These differences often made it hard for people from the North and South to agree on political issues. Westerners sometimes sided with the North and sometimes with the South. For example, westerners wanted internal improvements for transportation, which most northerners supported. Westerners also wanted to be free to move into new territories, which southerners also wanted. Some westerners supported slavery, while others did not. In general, westerners agreed with northerners about tariffs.

Question 12

What was an important crop in the West? What device was made to harvest it?

Answer 12

Wheat was an important crop in the West. The McCormick Reaper, which was invented in 1831, made the work of harvesting wheat much easier.

Question 13

What were Northern and Southern views on the Tariff of Abomination, passed by President John Quincy Adams in 1828?

Answer 13

In 1828, with the support of then President John Quincy Adams, Congress passed the highest tariff in the history of the nation. Southerners called it the Tariff of Abominations. An abomination is something that is wrong and evil. Just like earlier tariffs, the new law, which was passed before Andrew Jackson’s first term, protected manufacturers from foreign competition. Most manufacturers lived in the North and were helped by the tariff. Southern planters, however, were hurt by it. Southerners sold much of their cotton to Britain and bought British manufactured goods in return. A high tariff would mean that southerners had to pay more for those British goods. Worse still, they feared that if the United States imposed a tariff on British manufactures, Britain could respond by imposing a tariff on American cotton. Many southerners thought the tariff was unconstitutional.

Question 14

What were Vice President John Calhoun’s views on Nullification?

Answer 14

A leader in the South’s fight against the tariff was Vice President John Calhoun, whose home state was South Carolina. He claimed that a state had the right to nullify, or cancel, a federal law that the state considered to be unconstitutional. This idea is called nullification. Calhoun believed that the states’ rights gave them power over the provisions of the Constitution. He argued that states could reject federal laws that they thought violated the constitution, because the states had joined together to form the federal government based on their understanding of the Constitution.

Question 15

Why did Daniel Webster disagree with John Calhoun’s views on Nullification?

Answer 15

Daniel Webster, a Senator from Massachusetts, disagreed. He made a speech in 1830 to the Senate attacking the idea of nullification. The Constitution, he said, united the American people, not just the states, as a nation. If states had the right to nullify federal laws, the nation would fall apart. The U.S. Supreme Court had also ruled against earlier attempts at nullification, arguing that the provisions of Article III of the U.S. Constitution gave federal courts, not states, the right to decide on the constitutionality of federal laws.

Question 16

With whose viewpoints did President Andrew Jackson agree with over Nullification (Calhoun or Webster)?

Answer 16

President Jackson agreed with the views of Webster and the Supreme Court. Because Calhoun strongly disagreed with Jackson, he resigned from the office of Vice President. He was then elected as a senator from South Carolina. The debate over nullification would continue for years.

Question 17

Why did South Carolina pass the Nullification Act in 1832? What did the Federal Government do in response to it?

Answer 17

Anger against the tariff increased in the South. Congress passed a new law in 1832 that lowered the tariff slightly. South Carolina was not satisfied. It passed the Nullification Act, declaring the new tariff illegal. It also threatened to secede, or withdraw, from the Union if challenged. Jackson was furious. He knew that nullification could lead to civil war. To defuse the crisis, Henry Clay, now a senator from Kentucky, proposed a lower compromise tariff, which President Jackson supported. Jackson also asked Congress to pass the Force bill, which allowed him to use the army, if necessary, to enforce the tariff. Daniel Webster sided with Jackson on the Force bill but opposed Clay’s compromise tariff. However, Congress passed both the compromise tariff and the Force bill. Faced with Jackson’s firm stand, no other state chose to support South Carolina. Calhoun supported the compromise tariff that Clay had proposed. South Carolina repealed its Nullification Act, and the Nullification Crisis passed. National identity had proven stronger than the claim of a single state. However, tensions between the North and South would lead to increased sectionalism in the years ahead.

Question 18

How did the views of a National Bank differ between Jackson’s Democrats and Whigs?

Answer 18

Another political battle President Jackson waged during his first term as President was one against the Second Bank of the United States. Like many westerners, he thought that the Bank was too powerful and needed to be eliminated. Jackson’s Democratic Party opposed the Bank. The Whig Party, however, supported the Bank. Whigs believed that the Bank was needed to regulate state banks’ lending to prevent a buildup of debts that could not be repaid.

Question 19

What was controversial about the National Bank’s right to control the amount loaned by states?

Answer 19

The Bank of the United States had been a subject of dispute since its early days. The Bank had great power over the nation’s banking system because it controlled loans made by state banks. When the Bank’s directors thought that state banks were making too many loans, they limited the amount these banks could lend. The cutbacks angered farmers and merchants who borrowed money to buy land or finance new businesses.

Question 20

Why did Jackson and other leading Democrats feel like the Bank was undemocratic? Who did Jackson dislike that worked in the bank?

Answer 20

President Jackson and other leading Democrats saw the Bank as undemocratic. Although Congress created the Bank, it was run by private bankers. Jackson condemned these men as agents of “special privilege” who grew rich with public funds. He especially disliked Nicholas Biddle, president of the Bank since 1823.

Question 21

What was Nicholas Biddle’s background? Why did Jackson hate him?

Answer 21

Biddle came from a wealthy Philadelphia family. He was well qualified to run the bank. Under Biddle, the U.S. economy had experienced stability and prosperity. However, Biddle was arrogant and vain. Jackson felt that Biddle used the Bank to benefit the rich. He also resented Biddle’s influence over certain members of Congress.

Question 22

What plan did the Whig Senators Henry Clay and Daniel Webster think of in hopes of ruining Jackson’s re-election attempts and renewing the bank? How did Jackson respond?

Answer 22

Biddle and other Whigs worried that the President might try to destroy the Bank. Two Whig senators, Henry Clay and Daniel Webster, thought of a way to save the Bank and defeat Jackson in the upcoming election at the same time. The Bank’s charter was not due for renewal by Congress until 1836. However, Clay and Webster wanted to make the Bank an issue in the 1832 election. They persuaded Biddle to apply for renewal early. The Whigs believed that most Americans appreciated the role of the Bank in the nation’s prosperity. If Jackson vetoed the bill to renew the charter, they felt sure that he would anger voters and lose the election. Clay pushed the charter renewal bill through Congress in 1832. Jackson was sick in bed when he heard that Congress had renewed the Bank’s charter. “The Bank … is trying to kill me,” Jackson fumed, “but I will kill it!”

Question 23

Why did Jackson veto the Bank Bill?

Answer 23

In an angry message to Congress, Jackson vetoed the Bank bill. He gave two reasons for his veto. First, he said that the Bank was unconstitutional, even though in McCulloch v. Maryland the Supreme Court had ruled in the Bank’s favor. Like other Democrats, Jackson believed that the federal government could not charter a bank, because the Constitution did not explicitly give it the power to do so. However, the Supreme Court had ruled that the Constitution implicitly gave the federal government this right in the “necessary and proper clause.” This clause states that the federal government has the power “To make all Laws which shall be necessary and proper for carrying into Execution the … Powers [already described], and all other Powers vested by this Constitution.” The Supreme Court had decided that the “necessary and proper” clause gave the government the power to charter a national bank. Jackson believed that only states had the right to charter banks.

Jackson also felt that the Bank helped aristocrats at the expense of the common people. He warned:

When the laws undertake … to make the rich richer and the potent more powerful, the humble members of the society—the farmers, mechanics, and laborers—who have neither the time nor the means of [getting] like favors for themselves … have a right to complain of the injustices of their government.

—Andrew Jackson, Veto Message, July 10, 1832

Question 24

What was the turnout of the Election of 1832, despite the Whigs Party’s plan to make the Bank a major issue?

Answer 24

As planned, the Whigs made the Bank a major issue in the election of 1832. They chose Henry Clay as their candidate to run against Andrew Jackson. When the votes were counted, however, they showed that Jackson had won a stunning election victory. The common people had surprised the Whigs by supporting Jackson and rejecting the Bank of the United States.

Question 25

What were some effects of Jackson closing the National Bank? What were pet banks?

Answer 25

Without a new charter, the Bank would have to close in 1836. Jackson refused to wait. He ordered Secretary of the Treasury Roger Taney to stop putting government money in the Bank. Instead, Taney deposited federal money in state banks. They became known as pet banks because Taney and his friends controlled many of them. The loss of federal money crippled the Bank of the United States. Its elimination as a national bank was another effect of Jackson’s presidency. The end of the Bank’s role in regulating lending contributed to an economic crisis that would have to be faced by the next President of the United States. Without a national bank to regulate the country’s financial system, responsibility for regulating banks fell to individual states. The period from the late 1830s until the 1860s is known as the state banking era. During this time, each state set its own rules for banks. Many banks issued loans in the form of paper money, and promised to redeem it with silver or gold. Because federal law defined the value of dollars in terms of silver and gold, state banks sometimes failed when they did not have enough silver or gold on hand to redeem the paper money they had issued.

Question 26

Remember: During the state banking era, Americans relied on currency issued by state or private banks. Money from banks with poor reputations might not be accepted by other banks or merchants. There were thousands of different kinds of money in circulation.

Answer 26

During the state banking era, Americans relied on currency issued by state or private banks. Money from banks with poor reputations might not be accepted by other banks or merchants. There were thousands of different kinds of money in circulation.

Question 27

Who was elected after Andrew Jackson? What were his character traits? What did he need to improve on?

Answer 27

Following tradition, Andrew Jackson left office after two terms. Americans then elected Martin Van Buren as President. Although Van Buren did not have Jackson’s popularity, he was clever and intelligent. As President, however, Van Buren needed more than sharp political instincts.

Question 28

What happened in the Panic of 1837 and the five-year economic Depression that happened around the same time? Who was blamed for these events?

Answer 28

Two months after taking office, Van Buren faced the worst economic crisis the nation had known. After the Bank of the United States closed, state banks could lend money without limit. To meet the demand for loans, state banks printed more and more paper money. Often, they did not have enough gold or silver to back their paper money. Before leaving office, Jackson was alarmed at wild speculation, or risky investment, in land. Speculators were borrowing more and more money to buy land and driving land prices up. To slow this process down, he ordered that anyone buying public land had to pay for it with gold or silver. Speculators and others rushed to state banks to exchange their paper money for gold and silver. Many banks had lent too much money. They did not have enough gold and silver and were forced to close. The nation soon plunged into a deep economic depression, a period when the economy shrinks and many people lose their jobs. The depression lasted five years. During the worst period, 90 percent of the nation’s factories were closed. Unemployment was widespread. Hundreds of thousands of people were out of work. Many Americans blamed Van Buren and his policies for the economic depression. Van Buren believed in laissez-faire economics—the idea that government should play as small a role as possible in the economy. As the depression wore on, Van Buren became increasingly unpopular. His opponents called him “Martin Van Ruin.”

Question 29

Why were nominating conventions developed?

Answer 29

By the time the next election for President occurred in 1840, Whigs and Democrats had developed more democratic ways to choose candidates for President. In the past, powerful members of each party held a caucus, or private meeting. There, they choose their candidate. Critics called the caucus system undemocratic because only a few powerful people were able to take part in it.
In the 1830s, each party began to hold a nominating convention, where delegates from all the states chose the party’s candidate for President. Party leaders might still dominate a particular convention, but the people could now have some influence in the nominating process. Also, state nominating conventions encouraged citizen participation in elections. Once citizens learned about the events of the convention, they would work for their party’s choices. Today, the major political parties still hold conventions.

Question 30

Who were the candidates in the Election of 1840? What did the Whigs do to alter William Henry Harrison’s appearance to the people?

Answer 30

Although Van Buren had lost support, the Democrats chose him to run for reelection in 1840. The Whigs chose William Henry Harrison of Ohio as their presidential candidate and John Tyler of Virginia as their vice presidential candidate. Harrison was known as the hero of the Battle of Tippecanoe, which was fought between the American military and a Shawnee-led alliance in 1811. To appeal to voters, the Whigs focused on Harrison’s war record. “Tippecanoe and Tyler too” became their campaign slogan. The Whigs created an image for Harrison as a “man of the people” from the western frontier. They presented him as a humble farmer and boasted that he had been born in a log cabin. In fact, the Whigs’ candidate, Harrison, was a wealthy, educated man who, at the time of the campaign, lived in a large mansion.

Question 31

What ended up happening to President Harrison shortly after he took office? How did John Tyler fail to meet Whig expectations?

Answer 31

The Whigs’ policies included creating a new Bank of the United States, improving roads and canals, and demanding a high tariff. However, Whig hopes were dashed when, soon after taking office, President Harrison died of pneumonia. John Tyler then became President. President Tyler failed to live up to Whig expectations. He opposed many Whig policies. In response, the Whigs threw Tyler out of their party just months after he took office.