The Independent Treasury was a system for the retaining of government funds in the United States Treasury and its subtreasuries, independently of the national banking and financial systems. In one form or another, it existed from 1846 to 1921
"The Know Nothings" in the 1850s
The Know-Nothings, or the American Party, grew out of a rising tide of political xenophobia and Protestant revivalism . It appealed to white, Protestant, native-born voters who believed that the country was being overrun by German and Irish Catholic immigrants, particularly in the cities. These radical nativists believed that Catholic immigrants could not be trusted. As a political faction, the Know-Nothings strove to curb immigration and naturalization. The party attracted many middle class Protestants, and membership was limited to males of Anglo-American lineage. When asked about their secret activities, members reportedly responded with "I Know Nothing," a phrase that came to be associated with members of the American Party.
Immigration during the first five years of the 1850s reached a level five times greater than a decade earlier. Most of the new arrivals were poor Catholic peasants or laborers from Ireland and Germany who crowded into the tenements of large cities. Crime and welfare costs soared. The influx of many Catholic European immigrants into the U.S. and the urban problems it generated triggered alarm among many middle-class Protestant revivalists. Most anti-immigrant nativists saw foreign Catholics as the root of the liquor and alcohol problem that the temperance movement targeted. Some nativists even believed that there was a Catholic conspiracy by the pope to subjugate the United States through a continuing influx of Catholics. This fear of Catholic immigration led to a dissatisfaction with the Democratic Party, who broadly appealed to immigrants and lower-class laborers. Therefore, Know-Nothing activists formed secret groups, coordinating their votes and throwing their weight behind candidates sympathetic to their cause.
Rise and Decline
In spring 1854, the Know-Nothings enjoyed rapid success in many northern cities, especially in Massachusetts. Support for the Know-Nothings was also bolstered by the temperance movement, which sought to eradicate the evils associated with liquor (which was increasingly seen as an Irish Catholic immigrant problem). For the temperance supporters, the Know-Nothing movement represented a return to Protestant morality and control of the political system to moral, native-born politicians. Furthermore, the collapse of the Whig Party gave Know-Nothings a political void to fill, particularly in urban centers, which contributed to some of their success.
However, the Know-Nothings were not an uncontested party. Violence erupted at many elections, with naturalized voters claiming that the Know-Nothings rigged ballots. This violence, and other terror tactics that Know-Nothings used to prevent naturalized immigrants from voting, soon drove many of their potential supporters away. Furthermore, like the Whigs, the Know-Nothings could not find a way to keep their Northern and Southern factions together on a party platform. Officially, the Know-Nothings dissolved in 1856.
The Democratic Party
Origins and Ideology
The Democratic Party was formed in the 1830s around President Andrew Jackson and the primary domestic issues of banking and tariffs. Democrats strongly favored American expansion to new farm lands and the acquisition of new territories. To that end, Democrats supported President Polk and the Mexican War because of the vast land acquisition won in the Treaty of Guadalupe Hidalgo. Democrats also opposed elites, industrialists, and the Bank of the United States (which they believed would build up industry at the expense of the yeoman farmer). The Democrats were made up of a coalition of farmers, urban immigrant laborers, and Irish Catholics.
While Democrats believed that modern infrastructure and industry were necessary for American prosperity, they also believed that it was up to the states to promote market capitalism and sponsor improvement projects. Furthermore, Democrats claimed that modernization should be designed to promote the agrarian vision inherited from Jeffersonian Democracy (that is, the perpetuation of the independent, autonomous yeoman farmer over the wealthy, urban businessman). To that end, Democrats opposed high tariffs, supported free trade, and embraced the Independent Treasury as a device to facilitate the spread of prosperity.
The Sectional Party Split
In 1854, Democratic senator Stephen Douglas pushed the Kansas-Nebraska Act through Congress, which allowed for the expansion of slavery into those territories. Given the context of the volatile slavery issue, this prompted a readjustment in party lines and voters, including the collapse of the Whigs. While the Democrats survived, many northern Democrats flocked to the Free Soilers coalition and the newly-formed Republican Party, while Southern, proslavery Democrats formed the Southern Democratic Party. In short, the Democrats became almost entirely a southern party platform, which alienated its northern supporters who resisted the Southern proslavery political agenda.
The result of this sharp split in the Democratic Party after 1854 was that Democrats were unable to mobilize an effective, united political platform, in order to prevent the Republicans from achieving a majority in the Electoral College. This paved the way for the eventual election of Republican candidate Abraham Lincoln in 1860.