Forum Post: The Monster Bank DESTROYED (And Economic Terrorism)

The Second Bank of the Untied States (BUS) was the prime symbol of National Republicanism since its original charter was approved in 1816. The MONSTER BANK controlled the money supply, and Andrew Jackson thought that this single institution had more power than any other institution because it CONTROLLED the money supply.

The Second Bank director, Nicholas Biddle, applied to Congress for re-chartering, and Jackson VETOED the bill. Henry Clay thought he could defeat Jackson because of this, and Jackson whomped him!

Biddle then decided to engage in ECONOMIC TERRORISM by shortening credit, which triggered a DEPRESSION.

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THE MONSTER BANK

Originally chartered in 1816, its purpose was to control the money supply. ALL federal custom duties AND taxes were payable to the Bank of the United States (BUS). BUS could demand repayment for bank notes from teh original users in specie.

It was a mixed private/public corporation and could put government economic clout behind private enterprise. The CONSTANT inflow of taxpayer money gave it constant liquidity and awesome, vast financial resources.

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BUS POWER

This incredible power outraged Andrew Jackson. The BUS triggered the PANIC OF 1819!! And the second president, Nicholas Biddle, used the BUS resources to trigger a Depression when Jackson vetoed its re-chartering!!

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EARLY RE-CHARTERING

The political established led by Henry Clay sought early re-chartering for BUS, and Jackson courageously vetoed the bill. The veto was accompanied by a message that identified the BUS supporters as:

(a) foreigners;

(b) financiers; and

(c) usurpers.

Clay sought to override the veto. Clay, representing the establishment, warned of economic terrorism if the BUS was shut down. The veto was not overriden. Clay ran for president and was soundly defeated by Jackson.

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BANK WAR OF TERRORISM

The BUS still had four years on its charter. Jackson removed government deposits from BUS. Treasury Secretaries refused to obey Jackson's orders. Finally, Jackson recruited Roger Taney to remove the taxpayers' deposits.

Biddle, the BUS director, retaliated by engaging in economic terrorism; he started to call in loans unnecessarily. This resulted in a FINANCIAL PANIC in 1837.

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JACKSON HERO OF THE PEOPLE AND SOUND MONEY

Jackson then paid off the national debt. He gave government surpluses from the states now that the BUS was not looting it. He issued Specie Circular, which required that payment for federal lands be made only in specie, moving the country away from "bank notes" (see "Federal Reserve Note" written on your currency).

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BUS DEFEATED BUT NOT DEAD

The Bank of the United States---of course private---sought a state charter from Pennsylvania. The bank war destroyed the ILLUSION that a single Republican Party existed; and the National Republicans took their own party name then as "Whigs."

Jackson Democrats made popular will, freedom of thought, and the restraint of large concentrations of wealth the priority.