ANTIBANK MOVEMENT

ANTIBANK MOVEMENT. President Andrew Jackson's 1830s destruction of the Bank of the United States ignited an antibank movement directed against private banking corporations endowed by legislative charter with the right to issue circulating notes. The campaign spread to the states after the Panic of 1837, fed by popular resentment of a "moneyed aristocracy," disgust with an un-sound paper currency, suspicion of the mysteries of finance and credit, frequent exposures of banking fraud and malfeasance, and long-standing Jeffersonian hostility to chartered corporations as fonts of privilege and corruption.

Democratic presidents Martin Van Buren and James K. Polk moved to sever all federal connection with banks through the Independent Treasury, finally established by Congress in 1846. In the states, Democrats battled to replace banknotes with gold and silver "hard money" and to outlaw banking corporations outright or extend full liability to stockholders. An alternative, embraced by many Whigs, was to check abuses by instituting "free banking" open to all comers under standardized safeguards. The antibank campaign went furthest in western states, where high demand for credit had fostered erratic banking practices. The movement subsided with the enactment of state reforms and the rise of the slavery issue, and was finally superseded by federal banking legislation during the Civil War. Resentment against bankers lingered, to resurface in the Populist movement and other insurgencies.

BIBLIOGRAPHY

Shade, William G. Banks or No Banks: The Money Issue in Western Politics, 1832–1865. Detroit, Mich.: Wayne State University Press, 1972.

Sharp, James Roger. The Jacksonians versus the Banks: Politics in the States after the Panic of 1837. New York: Columbia University Press, 1970.

DanielFeller

See alsoBanking: Bank Failures, State Banks ; Free Banking System ; Independent Treasury System .