Independent treasury system

By Nicholas Gutierrez and Taddie Cook

History

The treasury was established by The Act of August 1846. This law required that the public revenues be retained in the Treasury building and in sub-Treasuries in various cities. Under this law the Treasury payed out its own funds and was supposed to be completely independent of the banking and financial system of the nation. However the action of the treasury still affected the national economy.

Significance

This system represented the growing advocacy for a more centralized treasury system to ensure stability of the money supply. Unfortunately, this system tended to elongate depressions and stunt growth by not being able to respond to one trend or another and instead demanded regular payment.

Sources

"Miller Center." American President: James Knox Polk: Domestic Affairs. Web. 6 Nov. 2014. http://millercenter.org/president/polk/essays/biography/4


"Cyclopædia of Political Science, Political Economy, and the Political History of the United States." Lalor, Cyclopaedia of Political Science, V.2, Entry 174, INDEPENDENT TREASURY. Web. 6 Nov. 2014. http://www.econlib.org/library/YPDBooks/Lalor/llCy565.html