Editing Langdon Cheves (section)

==President of the Bank of the United States==
===Background===
Shortly after Cheves left office in March 1815, President Madison successfully lobbied the new [[14th United States Congress|14th Congress]] to re-charter the National Bank, headquartered in Philadelphia and governed along much the same lines as its 1791 predecessor. Madison and Secretary Dallas successfully installed [[William Jones (statesman)|William Jones]] as its first President.{{sfn|Huff|1977|pp=96–101}}

Under Jones's leadership, the Bank was soon overextended through branch loans and the decision to accept promissory notes, often backed in its own stock, from subscribers in lieu of specie. Nevertheless, the Bank initially flourished in the booming post-war economy.{{sfn|Huff|1977|pp=96–101}}

Jones's tenure came to an end in January 1819. At that time, the country was experiencing a financial panic, the [[Panic of 1819]], which left the Bank on the brink of collapse. Cheves himself later referred to the Bank during this period as "a ship without a rudder or sails, on short allowance of provisions and water, on a stormy sea and far from land." It paused operations on July 20, 1818, and demanded payment of specie from state banks, bankrupting many and leading to a wave of resentment.{{sfn|Huff|1977|pp=96–101}}

===Election===
In December 1818, Charleston stockholders in the Second Bank asked Cheves for his permission to propose his name for the Bank presidency at the upcoming board meeting, and he consented.{{sfn|Huff|1977|pp=96–101}} Cheves was himself a founding but inactive member of the board of the Charleston branch, who later described himself as "ignorant and unapprehensive of the situation of the bank."{{sfn|Huff|1977|pp=102–08}}

His Charleston supporters enlisted the powerful support of [[Stephen Girard]] of Philadelphia and [[Alexander Brown (banker)|Alexander Brown]] of Baltimore. They elected Cheves to the board of the directors on January 5, 1819, but with no desire for a divisive leadership fight, failed to unseat Jones as president. Cheves accepted his seat with hopes that he would be elevated in 1820 when Jones, then ill, retired. Instead, Jones and the board were indicted by a House select committee chaired by [[John Canfield Spencer]] for violations of the Bank charter, poor management, and speculation. Jones resigned in disgrace on January 21. Cheves was his natural successor; he briefly considered, but declined, the chance to succeed [[William Johnson (judge)|William Johnson]] on the U.S. Supreme Court and accepted the presidency on February 15 and was sworn in on March 6.{{sfn|Huff|1977|pp=102–08}}

===Tenure===
The day after Cheves took office, the Chief Justice of the U.S. Supreme Court [[John Marshall]] delivered his opinion in the case ''[[McCulloch v. Maryland]]'', upholding the Bank's exemption from state taxation,{{sfn|Huff|1977|p=109}} harboring the Bank against its political opponents at the state level.

Shortly after he entered office, Cheves also presided over the establishment of a new bank building at Chestnut Street in Philadelphia. The building was completed in 1821.{{sfn|Huff|1977|p=113}}

====Monetary policies====
Cheves's early tenure focused on rectifying the failed promises of Jones's administration, enforcing monetary contractions at the branch level by ordering branches in the South and West to stop issuing notes and eastern branches to stop receiving them. He also reduced salaries and opened a correspondence with Secretary of the Treasury [[William H. Crawford]].{{sfn|Huff|1977|p=109}} On April 9, he called a meeting of the board of directors to outline his six proposals, which the board approved overwhelmingly:{{sfn|Huff|1977|pp=110–11}}
* that the curtailment of loans begun by Jones be continued;
* that southern and western offices be forbidden to issue notes whenever such notes would drain the eastern offices of specie;
* that state banks be required to begin immediate specie payments for debts to the Bank;
* that the Treasury give the Bank advance notice when it proposed to withdraw funds from a branch where no government deposits had been made; 
* that debentures be paid in the same currency for which they were originally issued; and
* that additional specie be purchased from abroad to secure the Bank's obligations.

Crawford voiced his displeasure at the requirement of Treasury notice. Cheves himself acknowledged that the curtailment of loans was only a temporary measure adopted at the insistence of Bank officers; he determined to lift the restriction as soon as possible. To Crawford, he wrote that the cause of the reforms was "the restraint put upon the offices, with which exchanges were adverse, in the issue of their notes." Circulation dropped about 25 percent.{{sfn|Huff|1977|pp=110–11}} Though his policies likely ensured the Bank's institutional stability, hard money advocate [[William M. Gouge]] blamed his restrictions for the continued depression: "The Bank was saved and the people were ruined."{{sfn|Huff|1977|pp=116–17}}

Within Cheves's first six months as president, a movement was instigated to remove him and return to Jones's policy, but it fizzled and he was re-elected unanimously in 1820.{{sfn|Huff|1977|pp=116–17}}

In 1820, drawing on the works of [[Adam Smith]], [[David Ricardo]], [[Thomas Malthus]], and [[J.B. Say]], Cheves anonymously defended his policies (under the pen name "Say") an essay titled ''Inquiry into the Causes of Public Prosperity and Distress''.{{sfn|Huff|1977|pp=119–20}} He argued that war-time prosperity had ended because of the failure of the foreign export market, the "diminution and depreciation of our currency," the "failure of manufacturing establishments," and the resulting "diminished demand for labor and capital." Amid this depression, a "pernicious system of banking" had cheapened the currency and produced "a kind of general paralysis," which his policies had reversed.{{sfn|Huff|1977|pp=119–20}} In time, he predicted, agriculture would be restored, though manufacturing would only grow at the same pace as population in the cities and towns.{{sfn|Huff|1977|pp=119–20}}

In January 1821, in an effort to placate the South and West, Cheves proposed a more lenient loan policy provided it was compatible with maintenance of a sound currency. He was opposed only by Nicholas Biddle.{{sfn|Huff|1977|pp=119–20}} He also established a dividend in July 1821 of 1.5%, which increased to 2.5% by January 1822.{{sfn|Huff|1977|pp=119–20}}

====Structural reforms====
Also in 1819, Cheves deputized director [[Nicholas Biddle (1786-1844)|Nicholas Biddle]] to investigate James A. Buchanan, George Williams, and James W. McCulloch for illegally purchasing bank stock worth nearly $3,500,000 and accumulating large and unauthorized personal indebtedness against the Bank.{{sfn|Huff|1977|pp=114–15}} Biddle's investigation revealed fraudulent inflation in the price of the Bank's stock and personal enrichment by all three men. McCulloch was removed as cashier and Buchanan resigned as president.{{sfn|Huff|1977|pp=114–15}}

In 1820, subordinate officers in Richmond and Philadelphia were forced to resigned for misconduct and unreported deficiencies.{{sfn|Huff|1977|pp=116–17}} Cheves called for investigations into the business policies of western branches and legal protections for the Bank by Congress amending the charter:{{sfn|Huff|1977|p=118}}
*the term of Bank directors to be extended to more than three years;
*legal protection for the Bank against frauds committed by its own officers;
*officials other than the President and cashier deputized to sign bank notes; and
*branches required by charter to accept only their own notes or those of the parent bank in Philadelphia.

These calls were unsuccessful; no Congressional majority could be gained to side with Cheves during his presidency.{{sfn|Huff|1977|p=118}}

===Resignation and succession===
As early as 1821, Cheves had resolved to retire from his post by January 1823.{{sfn|Huff|1977|pp=119–20}} He made his decision known to Secretary Crawford in May 1822 and announced it at the stockholders meeting on October 1, after which a struggle to succeed him ensued.{{sfn|Huff|1977|pp=121–27}} Cheves first fended off a challenge by Jones supporters who sought to reverse his policies; the board he nominated was elected unanimously.{{sfn|Huff|1977|pp=121–27}}

Among the Cheves supporters, Secretary Crawford solicited [[Albert Gallatin]], but received little approval from the directors. [[Roswell L. Colt]] lobbied for his nephew, Nicholas Biddle. Biddle was also a friend of President Monroe. [[Robert Gilmor Jr.]] advised Cheves that Biddle was "unsuitable."{{sfn|Huff|1977|pp=121–27}} Cheves adamantly preferred a Philadelphian, but disliked Biddle as pretentious for his opposition to his liberalization policies. Baltimore directors lobbied heavily for a resident of that city, but were split between Thomas Ellicott and John White, who had succeeded McCulloch as branch cashier, and were unable to overcome Cheves's preference for a Philadelphian.{{sfn|Huff|1977|pp=121–27}} Cheves ultimately settled [[William M. Meredith]] but, fearing Meredith was unqualified, asked White to accept the role of cashier to act as de facto President. White rejected this plan.{{sfn|Huff|1977|pp=121–27}}

Meanwhile, Biddle began to actively campaign for the position. Emphasizing support from Crawford and Monroe, he openly expressed his willingness to serve. He gained support from [[John Quincy Adams]], [[John C. Calhoun]], [[Stephen Girard]], and powerful Philadelphia stockholders.{{sfn|Huff|1977|pp=121–27}} In November, Cheves publicly supported Biddle as his successor and he was voted in 14–1.{{efn|The lone vote against was [[Samuel W. Dana]] of [[Connecticut]].}}{{sfn|Huff|1977|pp=121–27}}