Final answer:
Andrew Jackson closed the Second Bank of the United States due to his belief that it was unconstitutional, and his actions led to a temporary economic depression. He preferred hard money over paper currency and moved federal deposits into state banks while restricting the national bank's power, which resulted in financial turmoil and the Panic of 1837.
Step-by-step explanation:
Andrew Jackson and the Second Bank of the United States
President Andrew Jackson shut down the Second Bank of the United States due to his belief that it was unconstitutional and only served the interests of the wealthy. He distrusted the bank's issuance of paper currency, favoring instead hard money, such as gold and silver (specie). Jackson's actions included vetoing the renewal of the bank's charter, moving government deposits to state banks, and issuing the Specie Circular, which mandated the use of specie for land purchases. The consequences of these actions were significant, prompting the Bank War and contributing to an economic downturn known as the Panic of 1837.
Western farmers, states' rights advocates, and working-class people in some northeastern cities supported Jackson's decisions because they believed the bank limited credit and favored eastern elites. By transferring federal funds to "pet banks," Jackson aimed to decentralize financial power. However, the bank's director, Nicholas Biddle, retaliated by restricting loans, leading to a reduction in the money supply and financial turmoil.
The demise of the national bank and the shift to hard money had several effects, including a temporary economic depression and the opposition from sectors that had profited from the bank's credit policies. Jackson's initiative reflected his commitment to the principles of majoritarian democracy and his alignment with the interests of the common citizen over those of the elite.