When the USA was founded, it owed something in the order of £75m in debts to fund the War of Independence. After getting involved in the Napoleonic Wars, the debt rose to $127m.
Andrew Jackson the country’s seventh president and founder of the Democratic Party, was determined to get rid of the US national debt once and for all.
Jackson called the debt a “national curse” and promised to “pay the national debt, to prevent a moneyed aristocracy from growing up around our administration that must bend to its views, and ultimately destroy the liberty of our country.”
He was elected in 1829, by which time the debt had fallen to $58m. Fortunately for him, the 1830s were happy times for America’s economy. As business boomed, the taxes came rolling in.
In addition, Jackson cut back on government spending and embarked on a spree of selling off federal land in America’s West. He also abolished the country’s central bank.
By the end of 1834 he was able to announce to Congress that the country would be debt free in 1835. It is the only time that a major economy has operated without debt of any kind.
But it didn’t last. The ‘Panic of 1837’ struck, the economy tanked and America succumbed to the longest depression in its history.
The country has not been debt-free since. Now, America is famously saddled with $18trn in federal debt, or some $56,000 for every US citizen.