The American System

The new government views in the late 1800’s helped to promote America’s huge industrial growth because not one party controlled the government anymore; so all views were used to formulate new ideas.

He believed that the Bank has to be abolished due to several reasons. First of all, the bank concentrated the nation's wealth in a single institution which created an unhealthy for the economy monopoly. Second of all, he believed that the bank favored the wealthy over the common people. The third reason was that the bank had too much control over members of Congress. In other words, the subsidy of the bank to one particular party or the lack of the finance could influence the results of the elections at some point. And the bank also favored northeastern states over southern and western states. Thus, Jackson succeeded in destroying the Bank by vetoing its 1832 re-charter by Congress and by withdrawing U.S. funds in 1833. This action led to federal money being put into state banks who then loaned it out freely leading to inflation. State banks were issuing paper banknotes that were not backed by gold or silver reserves which led to rapid inflation. Moreover, the expansion of credit and speculation took place. As a result, state banks collapsed which was a cause of the Panic of 1837. However, despite the crisis and depression, the liquidation of the Bank was an achievement of Jackson’s presidency and led to trivial of the economy later on.

The book A Magnificent Catastrophe, by Edward J. Larson, narrates a story about how dirty and devious America’s first presidential campaign of 1800, how it became the most powerful election and how it molded America’s future in today’s society. Adams and Jefferson two great friends that shared one common goal. It is to obtain America’s freedom against the motherland Great Britain. They have remained close coworkers and friends throughout the American Revolution, but then in the 1800 each went thru their separate ways and had their own political parties and different ideologies. One believed that solitary “effective central government led by a powerful president could forge a stable, secure nation from a multiple of weak, wrangling states” (Larson, 2007, 17) and called themselves Federalist led by John Adams. Adams believed that America should have only one strong influential president that is in control of the nation. He does not want to give people too much power because he does not want them to have a lot of freedom. On the other hand, one wants America to be the “land of free, prosperous farmers and workers” (Larson, 2007, 17) called themselves Republicans led by Thomas Jefferson. Jefferson saw America as a country that is for the people. The people of the U.S is the President and that all people are born with individual rights. An individual rights that the government couldn’t restrict just because they wanted to control the people and create a central government. The

First, when the political parties emerged in the 1790’s it was evident that their ideologies were vastly different. The Republican Party wanted a representative form of government that functioned “in the interest of the people.” This party, led by Thomas Jefferson, supported a limited central government, with individual states retaining a majority of the control. Jefferson’s vision was for a nation of farmers, and farmers do not need big government to survive. They feared a large central government would take away the rights of the people. On the other hand, the Federalist Party, led by Alexander Hamilton, supported a strong central government that would pursue policies in support of economic growth, which in turn would provide the freedom the people wanted. Hamilton’s followers also supported a diverse economy.1 It is important to note here however, that both parties knew they would have to become national parties in order to win any elections and both parties had followers in the north and in the south. There was no sectional divide in the parties.

Conflicting views and contrasting ideologies have always existed throughout the history of United States politics. Alexander Hamilton, who led Federalist Party, believed that a powerful central government was necessary while Thomas Jefferson, who led the Jeffersonian Republican Party, favored an agrarian nation with most of the power left to the states. Although Alexander Hamilton and Thomas Jefferson were similar in that they both harbored good intentions and tried to keep the best interests in mind for the future of the United States, their policies were drastically different. Without doubt, both of their contrasting ideas served a vital role in forming the government.

The Panic of 1819 was the nation’s first major economic depression. The Panic of 1819 followed the events of the War of 1812, a period of national liveliness and included the forming of the Second Bank of America. After the War of 1812, the United States economy thrived as chartered State banks that were loosely formed issued redeemable promissory notes that were far beyond specie. The amount of money multiplied rapidly. Eventually, bank notes started to be sold at a discount as foreigners and money brokers profitably claimed the notes for specie. In addition, the Bank of the United States' began to call on branches to redeem other bank obligations. The monetary expansion ended all of a sudden and a lot of bankruptcies came to pass. The aftermath of the War of 1812 included war debt to be fixed, downturns in exports, and lack of demand for both manufactured goods and agricultural goods. There was a plan that was put in place to help repair America’s current economic state such as establishing the Second Bank of the United States to provide credit to citizens and establishing other banks around the U.S. This plan ended up causing a lot of problems such as poor management of the banks and the policies within the United States’ economy.

Since the creation of the United States Constitution, the many leaders of our nation took different roles in trying to attain perfectionism for their country. From the federalist views of John Adams to the democratic views of Jefferson, America was experiencing the endeavor that was being a young nation in the midst of the 19th century. The emergence of John Quincy Adams in 1820 started an “Era of Good Feelings” with exceptional political advancements and economic achievements. While Jackson’s democratic views were not always what were expected, during his presidency, the country grew national and world attraction. Through periods of boom and bust, political and economic changes in America undeniably helped reshape society between the years 1820 and 1848 with the emergence of new and innovative advancements.

Since the national bank was now destroyed, Jackson did not have a place to put it, so he decided to divide the money among the states. This is where it went downhill since the states begin printing massive amounts of money and quickly got out of hand and resulted in one of the longest depression in U.S history. As a result, The United States begin borrowing money again and the debt soon begin.

With the Jackson administration into office, the Second Bank of the United States became threatened. President Jackson had a private prejudice that wasn’t party policy (Schlesinger 74). He hated banks, all banks, but he especially hated the Second Bank of the United States. He viewed all bankers as “little more than parasites who preyed upon the poor and honest working people of America” (Roughshod 2). The reason for his hatred most likely stemmed from his near ruin as a businessman (land speculator, merchant, and slaver trader) when in the 1790s he accepted some bank notes that turned out to be worthless. From then on, he never trusted anything but hard money, or specie (Roughshod 2).

The American System created by Madison helped build unity in the early American Republic by creating tariffs, a national bank, and making improvements to transportation. The American System Henry Clay proposed this idea to President Madison to help unify the nation economically and socially. The American System was designed to unify the nation and strengthen the current economy. The American System would achieve this in three ways. One way was by making tariffs as a source of protection.

The American system was plan by Henry Clay and supported by the Whig party and some politicians like Henry Clay, John C. Calhoun, and John Quincy Adams. The American system was a document like the federalism. They wanted a stronger federal government, higher tariff, public land prices, stronger bank system, and

Though both Alexander Hamilton and Thomas Jefferson served as members of President Washington’s cabinet, the two held very different views on the newly founded U.S. government, interpretation of its constitution, and the role of the “masses” in that government. These conflicting views would develop in two political parties, the Federalists led by Hamilton and the Democratic-Republicans led by Jefferson. Although both political parties presented enticing aspects, Hamilton’s views were much more reasonable and fruitful when compared Jefferson’s views; idealistic and too strict in reference to the constitution.

After the “era” of Alexander Hamilton and Thomas Jefferson, Andrew Jackson and Henry Clay became the new dominant forces in politics. They each brought their own respective ideas to politics and as a result, Jackson and Clay went head to head on many issues. The results of these debates still affect the United States to this day, showing the extent of the power that they possessed. The power of the federal government, the national bank, and states’ rights were among few of the issues that Andrew Jackson and Henry Clay debated. The debates of Andrew Jackson and Henry Clay resulted in the creation the American System, which changed the future of the United States and made it economically successful and prosperous.

The Bank of the United States was technically the second bank of the U.S. since the first bank’s charter ended in 1811. The second bank held a monopoly over federal deposits, provided credit to growing enterprises, issued banknotes that served as a dependable medium of exchange, and used a restraining effect on the less well-managed state banks. Jackson didn’t trust the bank and thought it had too much power, so Jackson sought out to destroy it. There were two different groups when it came to opposition, “soft-money” and “hard-money”. Soft money supporters were progressive, they believed in economic growth and bank speculation. They supported the use of paper money and were mainly made up of bankers and allies to bankers. Hard money supporters were against expansion and bank speculation. They supported coinage only and rejected all banks that used paper money, which included the federal bank. Jackson was a hard money supporter although, he felt sympathy to the soft money supporters. Jackson could not legally end the bank before its charter expired. By removing the

The argument between Federalists and Anti-Federalists might seem long gone to American citizens, but still their philosophical foundations shape the teams, scope and size of the battlefield. These philosophies go back to two lone men, Alexander Hamilton and Thomas Jefferson. Both fought aggressively for a government based on their ideas, and both did make portions of the now-standing American government. This essay will outline the political, social and economic philosophies of both men, how their philosophies influenced the government today, and a closing opinion.