Speaker of the House Polk presided over what amounted to be a horrible Congressional session that had to deal with the ensuing economic collapse and panic. President Martin Van Buren asked that a special Sub-Treasury be created to prevent a rehash of the crisis in the future, and that special Treasury notes be issued so the government could pay its current bills. Finally, he asked that Clay's Distribution Act be indefinitely postponed. It took six weeks for the Congress to settle the matter, amid political feud after political feud. Polk's detractors felt the political situation was more important than the crisis and continued their petty attacks and obstructionist maneuvers. Former President and now Representative John Quincy Adams continued to hound Polk with abolitionist petitions, sometimes upwards of a hundred times a day. As the debate wore-on, anti-panic measures slowly passed: at the end of September, the Treasury notes were authorized and it was a little longer still before Congress suspended the Distribution Act. In six weeks, it never acted on the sub-treasury bill. Although Van Buren again tried to pass it in the regular session in December, Congress never considered the bill. Gradually, though, foreign gold and business began a reversal of the panic and a year after the New York City banks had closed, all the nation's banks reopened.
Polk and his friend Andrew Jackson had already turned their attention to the next presidential election. Van Buren, despite his growing unpopularity, wanted to run again–but another successful election was anything but certain, especially with the Democratic party splitting into factions. That summer, Polk met several times with Jackson at the latter's plantation to discuss strategy. At one such session, Jackson informed Polk that he would have to run for governor of Tennessee. The Democrats needed Tennessee to win the next election, but they no longer controlled the state's party apparatus; it had become too fractured. Polk finally agreed, and Jackson began to campaign for Polk. Tennesseans greeted Polk's candidacy warmly, and his election looked assured.
Although his days as speaker were now limited, Polk's job did not get easier. Growing border troubles, especially the possible annexation of Texas, helped rile congressmen. Shortly before the House adjourned for the year in 1839, a member introduced a resolution thanking Polk for his work as speaker–igniting a firestorm unlike anything the House had seen in a while. Polk's opponents first blocked it on a parliamentary technicality and then tried to amend it to criticize Polk. However, the House upheld the original resolution and, as Polk exited, gave him an ovation.
Polk returned home to acclaim for his even-handedness as speaker. He began his campaign for governor with a state-wide speaking tour, to which he invited the incumbent governor–his opponent–to join him. They planned to appear side-by-side, speaking one after the other at venues around the state. After years of bitter personal fighting in the House, Polk enjoyed the opportunity to travel and converse with his opponent in a friendly manner. At each town, crowds greeted them, some cheering for the incumbent governor and some for Polk, whom they called "Young Hickory."
At the second stop, though, Polk's old enemy John Bell was in the audience and saw that Polk talked circles around the governor in debate. Bell leapt and took over the anti-Polk campaign. His fiery and vitriolic speech caught the crowd off-guard and probably did Bell's cause more harm than good. The governor returned to Nashville and Polk continued his campaigning alone–with Bell usually just a day behind. Nonetheless, Polk won on election day; on the same day that Tennessee elected seven Whigs to Congress and only six Democrats. Jackson wrote to Polk that he was happy the Democrats could now hold the state for "at least a hundred years!" The party celebrated Polk's election with a week-long jubilee at a private spa and then, on Monday, October 14, 1839, Governor Polk was inaugurated. In his speech, he laid out his basic doctrine of states' rights and the threats he saw to their sovereignty.
Just a few days later, the state legislature nominated Van Buren for president and James K. Polk for vice-president. Polk did not leap at the chance, but toed the party line: He would support whomever the party nominated or whoever collected the most legislative nominations. Much of the nation supported Polk, including all of New England and both Carolinas, but when Van Buren selected a vice-presidential running-mate–for reasons that remain mostly unclear to this day–he chose R.M. Johnson, one of the least popular men in the party. Polk dutifully campaigned for the Van Buren–Johnson ticket throughout Tennessee, despite his personal reservations about the quality of the candidates. The Whigs nominated William Henry Harrison for president and John Tyler for vice-president. And on a pastoral platform of simplicity (contrasted against Van Buren's stately and citified airs), Harrison won the presidency. Curiously, though, Virginia cast one electoral vote for Polk as vice president.
In December 1840, Felix Grundy died and Polk's friends urged him to ascend to the vacant senate seat in the U.S. Congress, but Polk eventually decided to nominate someone else for the job. The next political vacancy proved much more surprising. Just a month after the presidential inauguration, Harrison died of pneumonia, leaving the presidency to Tyler–thereby bettering Polk's chances of capturing the presidency in 1844. Tyler, a political unknown in many respects, began appointing Democrats to many political posts and backed most Democratic proposals.
After a long and bitter campaign, Polk lost reelection in 1841 as governor. His opponent, James C. Jones, had decided to attack Polk for being too aristocratic, and so he constantly and sarcastically deferred to his "venerable opponent" during debates, bowing deeply and offering to help Polk up from his chair. Polk accepted the defeat in stride and the following year also turned down another appointment to the Senate, saying he would only accept such a post "unless it was given by the vote of the people themselves." And with that, he began the 1843 campaign for governor.