In 1836, the Bank of England, fearing a run on its deposits of specie (silver and gold), sharply contracted credit. British companies curtailed their business with the United States. Foreign demand for U.S. cotton plummeted, cutting cotton prices nearly in half.

Voter participation reached an astonishing 80% in 1840, setting a pattern for high turnouts that continued through the 19th century.

Southern planters suffered and many northern companies associated with the cotton trade failed. The Specie Circular, which mandated that speculators could purchase public land only with hard money, caused a drain of specie from eastern to western banks.

In April 1837, world prices suddenly collapsed, creating a run on banks. On May 10, 1837, all banks in New York suspended specie payments — that is, they refused to redeem paper currency in silver or gold. Banks in New Orleans and other cities soon did the same.

The specie suspensions caused panic, which in turn led to widespread bank failures. The New York diarist George Templeton Strong said, of the banks, “So they go — smash, crash. Where in the name of wonder is to be the end of it?”

All told, around 40% of America’s 850 banks soon were out of business. Most sectors of the economy slumped. Business failure brought unemployment. By January 1838, half a million Americans were jobless.

The economy then briefly rebounded, but another contraction abroad brought on a second panic in October 1839, leading to four more years of depression.

Wholesale prices tumbled, and the nation’s money supply shrank. Imports plummeted, as did property values. America would not again see such deep, prolonged economic malaise until the Great Depression of the 1930s.

Predictably, President Van Buren was blamed for the downturn. Whigs insisted that Jackson’s reckless policies, carried forward by Van Buren, had wreaked havoc on the economy.

All told, around 40% of America’s 850 banks soon were out of business. Most sectors of the economy slumped.

What was needed, they argued, was government-sponsored stabilization of the economy through a new national bank. As the “out” party, the Whigs profited politically from the depression, gaining in state elections at moments when it was especially bad.

Still, as the 1840 election approached, Van Buren had reason to be confident of re-election.

He had consolidated the Democratic Party. He had averted war and subdued sectional tensions. He had run a tight financial ship with the assistance of generally skilled administrators.

In his view, he had put the nation on a course toward economic recovery by divorcing the government from banking.

He did not seem to recognize the depth of the nation’s crisis. A much later Democratic presidential candidate would heed advice that should have been shouted in Van Buren’s ear: “It’s the economy, stupid!”

Despite the small upturn of the economy in the middle of Van Buren’s term, the nation had never seen such hard times as it did under him.

It was difficult for many Americans to fathom the withdrawal of the government’s money from many banks at a time when money was in such short supply.

The Whig arguments for an expanded currency, relaxed credit and governmental participation in everyday finance made sense at a time when scarcity reigned.

The Democrats’ largest base was among rural and urban workers. The Whigs appealed mainly to business interests in the North and plantation owners in the South, but also to some sectors of the working class.

Neither party was wholly “the people’s party,” though the Democrats had seized this image.

The economy then briefly rebounded, but another contraction abroad brought on a second panic in October 1839, leading to four more years of depression.

The Whigs believed in government control of the economy through some version of the American system. They tended to be affiliated with movements like temperance, prison reform, nativism and anti-prostitution.

The turnout on election day was exceptionally strong. Voter participation, which had stood at 58% of eligible voters in 1836, reached an astonishing 80% in 1840, setting a pattern for high turnouts that continued through the 19th century.

Although the Log Cabin hoopla contributed to the excitement, recent historians have shown that it was the mass hunger for economic reform that brought out voters in unprecedented numbers. The Whigs surged to victory.