JACKSONIAN DEMOCRACY 1825 1850
PRESIDENT ANDREW JACKSON
|
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
|
|
|
the President issued an executive order to establish the bank
|
|
|
the U.S. Treasury alone sets all government monetary policies
|
|
|
the House of Representatives has the sole authority to raise revenue
|
|
|
the Constitution does not specifically empower Congress to create a bank
|
Detailed explanation-1: -Jackson, the epitome of the frontiersman, resented the bank’s lack of funding for expansion into the unsettled Western territories. Jackson also objected to the bank’s unusual political and economic power and to the lack of congressional oversight over its business dealings.
Detailed explanation-2: -In large part this opposition was based on the very restraints the bank imposed on private, state-chartered banks; this was also seen as an affront to states’ rights, and the bank’s federal charter was called unconstitutional. In 1811, when the 20-year charter expired, renewal was politically impossible.
Detailed explanation-3: -The War of 1812 had left a formidable debt. Inflation surged ever upward due to the ever-increasing amount of notes issued by private banks. Specie was jealously hoarded. For these reasons President Madison signed a bill authorizing the 2nd Bank in 1816 with a charter lasting 20 years.
Detailed explanation-4: -Although foreign ownership was not a problem (foreigners owned about 20% of the Bank’s stock), the Second Bank was plagued with poor management and outright fraud (Galbraith). The Bank was supposed to maintain a “currency principle”–to keep its specie/deposit ratio stable at about 20 percent.