VAN BUREN, Martin. Autograph letter signed ("M V B") as Vice President, TO ATTORNEY GENERAL BENJAMIN F. BUTLER, [Washington], 7 March 1834. 3 pages, folio (12 5/8 x 7 13/16 in.), partly separated along central fold, 1 1/8 in. irregular tear to margin of page 3, otherwise in good condition.
VAN BUREN'S ROLE IN JACKSON'S WAR ON THE BANKS
While the loyal Van Buren supported Jackson's actions to prevent the recharter of the Second Bank of the United States, he was concerned about Jackson's order (of September 25, 1833) to remove Federal funds from its vaults. In addition, the powerful opposition to Jackson's bank policy made Van Buren fear that his support of the plan might jeopardize his chances of becoming President in 1836. While he never openly opposed Jackson, he intentionally sought to delay the withdrawal of federal funds. Jackson eventually instructed Treasury Secretary Roger Taney to transfer the money to state banks (R. Remini, Andrew Jackson and the Course of American Democracy, pp. 88-92).
When Governor of New York, Van Buren had played a key role in legislating the Safety Fund System, which required state banks to contribute to a reserve fund used to redeem the paper currency of failed institutions. Here, in the wake of Jackson's removal of federal deposits, Van Buren suggest that the Attorney General review the state legislation: "Get the Safety Fund Law out of the Library...[it is] the result of a settled policy of many years duration...which general provisions...[are] necessary for the safety of the people." Regulating the banks, he observes, is not a simple matter: "The impracticality of the great body of the people judging intelligently of the manner in which the respective banks conduct their offices & their consequent safety--the superior ability of the banks to do so, hence the expediency of making it their intent to watch each other." He doubts the wisdom of "making them to whom has been granted the profitable right of furnishing the circulating medium of the country responsible for its safety." Finally, Van Buren suggests formation of a regulatory body: "The manner of their appointment: one by the City Bank, 1 by the Country Bank & 1 by the Government. Their duties: inspection superior to the old practise of making returns. Their powers: own the Banks for the security of the public. The various provisions of the Bill to...[abolish] old abuses & prevent new ones." The Vice-President voices his reliance on Butler's aid, noting that it is "the first time I ever have called on Hercules for help."
Ultimately, Van Buren's concerns about Jackson's policy with the banks proved prophetic, and both Jackson and his successor were widely blamed for the disastrous Panic of 1837.