Planet Money Podcast: The Bank War

March 24, 2017

Note from the Second Bank of the United States. Collection of the Museum of American Finance.

By Jacob Goldstein, Planet Money

Banks and governments have been fighting each other for hundreds of years, but never more dramatically than during the showdown between President Andrew Jackson and Nicholas Biddle, the president of the Second Bank of the United States.

Jackson was a populist, who rode to victory on promises to wrest control of the country from the East Coast elite. He was angry at the power structure, and he was furious at the banks. To him, they were the phantom controllers of the economy, issuing spurious scripts that often vanished with the banks when they collapsed.

Biddle was pretty much the opposite of Jackson, raised in the one of the country's earliest aristocratic families. He was a poetical kid and a classics scholar, who started Princeton when he was 17. He believed in banks and he believed that a well run bank would serve the nation and create stability.

In the 1830s their two views of the nation collided, with disastrous and long-ranging results.

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