character of some of the outrages upon the property and persons of our citizens, upon the officers and flag of the United States, independent of recent insults to this Government and people by the late extraordinary Mexican minister, would justify in the eyes of all nations immediate war.' He accordingly recommended reprisals, enforced by the use of the navy in case Mexico should refuse to settle "upon another demand... made from on board one of our vessels of war on the coast of Mexico." 1 Congress, just happily freed from the possibility of war with France, was in no mood for a war with Mexico, and passed resolutions favoring another demand before resort to coercion, as provided for by article thirty-four of the treaty of 1831. No further action was taken. Jackson's limitations as a diplomatist were offset, in the popular estimation, by the general success of his policy. No international questions of the first order arose during his administrations, and the personnel of the diplomatic service was not distinguished; but a number of important differences, some of them of long standing, were adjusted and respect for the United States appreciably enhanced. Towards powerful states Jackson used frowns or smiles as best suited his mood, while weak states like Mexico were treated with scant regard; but there was unceasing watchfulness over American interests and a jealous care for national honor and standing. 1 Richardson, Messages and Papers, III., 278. ness. CHAPTER XIII REMOVAL OF THE DEPOSITS 1 (1832-1837) N a speech on the bank veto, July 13, 1832, Benton declared to the supporters of Jackson that "they might continue to be for a bank and for Jackson, but they could not be for this bank and for Jackson." The speech emptied the Senate, but Benton's words stated the situation with exactThe attitude of Jackson towards the bank had done more than anything else to consolidate his followers into a party and give them a slogan; and henceforth those who were not for him were to be regarded as against him. Whether or not the bank would be allowed to run the remainder of its course in peace depended mainly on its own conduct; but there was no real hope of a renewal of the charter, nor of the establishment of any other similar institution with monopolistic privileges. Whatever it did, however, the bank was under Jackson's eye, and no amount of preoccupation with South Carolina and the nullifiers, or with the details of a presidential campaign, could lessen his 1 Benton, Thirty Years' View, I., 262 vigilance, as no amount of good conduct on the part of the institution could allay his instinctive, deeprooted, and merciless hostility. The bank itself invited a renewal of the attack. In March, 1832, as the public debt was nearing extinction, the directors authorized an arrangement by which the bank was to obtain the certificates of foreign holders of five million dollars of threeper-cent. stock, and turn them over to the United States; and to hold the money thus advanced to the government as a loan on its own account, with interest, for one year. The government would thus be free of obligation on account of the debt, while the bank would assume a new loan for five million dollars.1 In August, however, General Cadwalader, who had been sent by the bank to England to negotiate with the firm of Baring Brothers, arranged with that house to secure from the foreign holders of the stock an extension of their loan for a year. and to buy up as much of the stock as could be had at an agreed figure. The plan contemplated by the bank was unobjectionable, but Cadwalader's contract not only violated the provision of the bankcharter act which forbade the bank to purchase any public debt, but also prevented the discharge of the debt of the United States." The contract was repudiated by the bank in 1 Catterall, Second Bank, 270. For the correspondence, House Exec. Docs., 22 Cong., 2 Sess., No. 9. October, but its announcement greatly intensified the popular hostility to the bank, and led to charges of deliberate violation of the charter. In his annual message in December, Jackson called the attention of Congress to the transaction, raised the question whether the public deposits were “entirely safe" in such an institution, and recommended an inquiry into the affairs of the bank and its branches. The disposal of all stocks held by the United States in corporations, state or federal, was also urged. "As a source of profit," the message declared, "these stocks are of little or no value; as a means of influence among the States, they are adverse to the purity of our institutions. The whole principle on which they are based is deemed by many unconstitutional, and to persist in the policy which they indicate is considered wholly inexpedient." 1 McLane, the secretary of the treasury, had already appointed a special agent, Henry Toland, to investigate the condition of the bank. Toland's report, submitted on the same date as Jackson's message, showed that the bank had assets of $79,593,870 with which to meet $37,296,950 of liabilities-obviously a solvent and safe condition. February 13, 1833, in the House, a bill authorizing the sale of the bank stock held by the United States, reported by Polk from the committee of ways and ' Richardson, Messages and Papers, II., 599. means, was rejected by a vote of 102 to 91; and on March 2 the House voted, 109 to 46, "that the Government deposits may, in the opinion of this House, be safely continued in the Bank of the United States."1 In the election of 1832 the bank took no part beyond the circulation of literature favorable to its interests; and, after the result was known, no radical change of policy was planned.' The suggestion of removing the deposits created some excitement, and preparations were made to meet a run on the branches, but it was not yet believed that removal would actually be directed. Jackson had become thoroughly convinced, however, that the bank was unsound, that it had sought to influence the election against him, and that bribery would probably be resorted to to secure a recharter. The result of the election confirmed him in his purpose to break all connection between the government and the bank; and even the warning of friends that no combination of state banks could take the place of the Bank of the United States, and that the removal of the deposits would be the signal for a panic, could not deter him. His course from this time was laid with his eyes open, and he must in consequence be held responsible for its outcome. Only the profoundest ignorance of public finance could have led Jackson to believe that the removal of the deposits, under the circumstances, would result 3 1 House Reports, 22 Cong., 2 Sess., No. 121. 'Catterall, Second Bank, 285. |