Relations States, III, to the refusal of Congress to open the ports of the United States to British shipping, Great Britain had closed the West India ports to United States vessels. Canning died in 1829, and in the ministry which followed, Lord Aberdeen was foreign minister. Ever conciliatory, he at once listened to Jackson's overtures; Congress passed the necessary laws removing many restrictions on British commerce, and Great Britain opened the West India ports to the commerce of the United States. With France there was a long-standing dispute as to the payment for spoliations on American commerce committed since 1803. In 1830 the "Revolution of July" placed Louis Philippe at the head of the French government. He 504, IV, 239. promptly agreed to pay five million dollars as an indemnity to the United States, but the French legislature refused to make the necessary appropriations. At one time, it seemed as if war were about to break out between the two countries. In the end, France gave way and paid the money (1835). Jackson also secured the settlement of long-standing disputes with Denmark and Spain, and brought other nations, like Austria, to recognize the importance of having friendly relations with the United States. The Second Bank. States, IV, 44. 290. Jackson's War on the Bank. - The Second United United States States Bank had been chartered in 1816, five years after the older institution associated with Hamilton had come to an end by limitation. In the case of McCulloch vs. Maryland (1819), the Supreme Court, through Chief Justice John Marshall, had decided that the charter of the Bank was legal and constitutional (p. 372), and this decision had been affirmed in 1824 in a subsequent decision. Jackson, nevertheless, felt an instinctive dread of the Bank, and he did not regard Marshall's decision as in any way binding on the Executive. The President's dislike of the Bank was based on several grounds: for instance, he saw in it a great monopoly stretching its arms over the whole country, able to determine by its action whether one section or another should be developed to its utmost. Furthermore, Jackson Jackson's views as to the Bank. 1831] Jackson's War on the Bank 429 knew how badly some state banks were managed,— and at this time the state banks were, to a great extent, political institutions conducted largely in the interest of this or that political clique. Knowing this, Jackson made up his mind. that the Bank of the United States was a political machine, carried on in the interests of his enemies. There is no doubt that it had been badly conducted during the first years after 1816, but for many years before 1829 it had been admirably managed by its president, Nicholas Biddle. The capital of the country was no doubt mainly in the hands of those who had slight confidence in Jackson, and the customers of the Bank were undoubtedly composed to a great extent of his opponents. Finally, Jackson, and those behind him, with their strict constructionist views, could hardly help reverting to the interpretation of Jefferson (p. 294), and regarding the bank charter as beyond the power granted to Congress in the Constitution. Jackson at once declared his open hostility to the Bank, and Henry Clay as eagerly championed the cause of the great institution. As time went on, Jackson became more and more convinced of the truth of his suspicions, that the Bank was a great political machine. This was especially made evident to him by the appointment of a stanch opponent of his party as head of the branch at Portsmouth, New Hampshire. The Jacksonian leaders in that state protested. The Secretary of the Treasury wrote to President Biddle remonstrating against what he regarded as a political appointment and suggested that the officers of the Bank should be appointed without regard to political preferences, somewhat curious language coming from one of Jackson's cabinet, who was at the moment engaged in removing worthy officials to make room for rank partisans. President Biddle saw in the letter a suggestion that the Bank was under the control of the government; he most incautiously denied the secretary's right to interfere, at the same time asserting that the Bank was conducted without regard to politics. Clay champions the cause of the Bank, 1832. Removal of 1833. States, IV, In 1832, four years before the charter of the Bank would expire, and when Jackson's opponents, although in a majority in Congress, had not sufficient votes to pass a bill over Jackson's veto, Clay brought in a bill to recharter the Bank. Jackson promptly vetoed it, and the bill could not be passed over his veto. The matter, therefore, became one of the leading issues in the campaign of 1832. It seems extraordinary that a man of Clay's political experience should have hazarded victory or defeat on such an unpopular issue. Jackson asserted with truth that the Bank was an “unAmerican monopoly." It was entirely unlike the national banks of to-day, as a national bank can now be organized by any set of men who can find enough money to deposit the necessary bonds with the government. The present scheme is based on what was known in 1831 as the "New York plan," and was then in force only in New York. All the other state banks, as well as the United States Bank, were chartered specially by the legislative body of the state or nation and were one and all of the nature of monopolies; but there were so many state banks that the evil as to them was scarcely apparent. It was apparent enough as to the United States Bank, and the people sympathized most warmly with Jackson on this as on other issues. 291. Removal of the Deposits, 1833. One of the chief the deposits, arguments in favor of the establishment of the Second Bank, as of the earlier one, was the facilities it gave for the collections and disbursements of the government. The revenues, as collected, were deposited in the Bank or its branches, and payments were made by drafts on the institution. This business was done by the Bank for nothing, as the balances kept by the government enabled it to make large sums of money by loans. Apart from constitutional and political grounds, and granting the solvency of the Bank, the arrangement was most advantageous to the government, which saved all the money afterwards used in the construction of vaults, the payment of custodians, and the 1833] Removal of the Deposits 431 charges of transportation; it was advantageous to the people, The Senate censures The Senate was still in the hands of Jackson's enemies. Under the lead of Clay and Webster, it passed a vote cen- Jackson. Speculative mania, 1837. Surplus with the states. suring the President for what he had done. To this Jackson replied in a letter. He protested against the action of the Senate in censuring the President, which could only be done by impeachment. He declared that the chief magistrate was entitled to interpret the Constitution for himself, and that he was not bound by the decisions of the Supreme Court, as each department of the government was independent of the other two departments. Two years later Jackson's party obtained control of the Senate, and the vote of censure was expunged from the Journal of that body. 292. Distribution of the "Surplus," 1837. - Historical students seem to be fairly well agreed that the check placed on the power of the United States Bank by the removal of the deposits was in itself a wise action, apart from the constitutional and political questions involved. The mode and time chosen for the accomplishment of this purpose, however, were most unfortunate. The one institution which possessed the ability to set bounds to reckless inflation and speculation was deprived of a great part of its power to do good, and nothing was put in its place. The government, so far from putting a check on the speculative frenzy which had taken possession of the people, actually increased it. Then, at last, becoming alarmed, Jackson interfered in his masterful way and gave the signal for widespread financial disaster. On the first day of January, 1835, the last installment of "deposited" the national debt was paid; the government owed nothing and was collecting about thirty-five millions per year more than it could reasonably spend on objects which the strict constructionists of the Jacksonian school regarded as within the scope of the powers of the federal government under the Constitution. Moreover, the revenue could not be diminished, because it was collected in pursuance to the Compromise Tariff Act of 1833, which could not be disturbed without a breach of faith and without precipitating a political crisis that no one desired to see. At the present time, the government can hoard its surplus revenues in the |