The History of Andrew Jackson And National Debt Reduction : Planet Money : The Indicator from Planet Money President Andrew Jackson was ruthless in reducing federal debt. The administration paid off all interest-bearing debt in 1835, but the results were not as rosy as people expected.

The Time the US Paid Off All Its Debt

The Time the US Paid Off All Its Debt

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The United States federal government currently has over 28 trillion dollars of debt and there are concerns about the ever-increasing debt level. The majority of that national debt is issued in the form of bonds and bonds are considered among the safest investment assets in the world. However, the U.S government once paid off all of its interest-bearing debt.

President Andrew Jackson was a staunch opponent of the existing banking system. He also wanted to get rid of the national debt. In fact, his administration paid off all the interest-bearing debt on January 1, 1835. Historian Ann Daly lists three reasons for this to happen. The federal government collected many millions in tariffs, sold massive amounts of public land, and President Jackson vetoed spending bills left and right. Then he decided to give the surplus back to the states. Jackson's actions though and the zeroing out of the US debt contributed to the Panic of 1837, one of the worst recessions in American history.

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