Presidential money moves: James Madison

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2008 - George W. Bush 1971 - Richard Nixon 1930 - Herbert Hoover 1965 - Lyndon B. Johnson 1933 - Franklin Delano Roosevelt 1816 - James Madison 1890 - Benjamin Harrison 1913 - Woodrow Wilson 1791 - George Washington

James Madison

Creation of the Second Bank of the United States

Like the First Bank, the Second Bank of the United States came about after a major war. This time, it was born out of the need to pay off debt from the War of 1812. President James Madison signed a bill to create the Second Bank of the United States in 1816 to help pay off wartime debt.

But it wasn’t all sunshine and gumdrops for the Second Bank. In 1818, the state of Maryland tried to tax a bank branch, but the branch head, James McCulloch, refused to pay the tax. The state filed suit, and the case eventually made it to the Supreme Court in 1819 as McCulloch v. Maryland. The Court made the landmark decision that state law does not trump federal law.

Eventually, the wartime debt was repaid, but like the First Bank, the Second Bank’s 20-year charter wasn’t renewed. In 1832, President Andrew Jackson vetoed a bill that would do that, according to the Minneapolis Federal Reserve. The charter expired in 1836.