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The Madisonian. [volume] (Washington City [i.e. Washington, D.C.]) 1837-1845, October 03, 1837, Image 2

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IFiiKCU (>y IK
In support of t)u Bill introduced by *"
uvLaliM IMt fund* rtcnraMe tn paymrnt of the
puMU reef**, and in 7T*"** ^Jjt'vSd
'rm Scheme. Iteitrered In the Senate oj <? t ???"
Mb. PaiuuDtNT?
I rise in pursuance of the notice I gave yesterday,
to Cleave to bring in a "Bill to designate he
funds receivable in payinei?l of the revenue of the
United Stales." It will be borne in mind by Ae??
nate that among the moat prominent, and certainly
not the least important objects presented both by Uie
President's Message and the Report ot the bccrctfe
rv of the Treasury, for the " immediate "ilentum
of Congress at their present session, ts the "Pl
enty of some legislative provision defining the cha
racter of the funds to b.' received, in luiure, tn Uis
charire of the public dues. From the intimate eon
3 lite collection of the public revenue
and the general currency of the country, this <1
tion has, in my estimation, far more essential d-u
ings on the great interests of the ^inmuni y,
any which the President has submitted lor our de
liberations. The Committee ol
t., whom the Message was referred.havelnotth< U,h
it proper to make any report on 'Hat port, m of it,
and we have been informed byt* J"?
man, that it is not their intention to ^ k e " *
port upon it at the present session. It is? ou??
sion, on the [.art of the Committee, that it is the ob
ject of mr motion now to supply. _,,r<i .Kp
The President recommends that henceforward the
whole revenues of the United Suites shall be col
lected exclusively in gold and sili%. A
of so marked a character, emanating fioin a
of such high authority, could not fail to excite deep
anxiety in the public mind; and it seemed to me
that all uncertainty in regard to the ^^yofU-e
Government, on so vital a subject, should be PW?U?
ly settled, one way or the other, by the action, of the
legislative department. It is my misfortune to diner
with the President in his views ot the expediency
of this proposition. I am firmly convinced that, in
the actual condition of our circulating medium, and
in what is likely, for years U come, to b? ite conai
tion, the operation of such a measure would be: dis
tressing to the community, injurious to eve rv biianc
of industry and enterprise, and above al1'
postpone indefinitely that return to specie iwyments
by the banks, which is the great object of the public
solicitude, and ought to be the end and a.m otourdt
liberations here. Viewing the question in this I'M' j,
I desired it shoul.l bo met with promptitude, consi
dered with candor, and decided with wisdom.
Since I gave notice yesterday, of my motion, two
gentlemen, the Senator from ??
and the Senalor from Missouri, (1^ Benton,) have
submitted propositions intended/to carry out tne
President's recommendation, differing somewhat in
detail, but both founded on the principle ol rejecting
bank paper altogether in the operations ot the Uo
vernment, even though immediately convertible into
specie, and issued by bants of unquestionable solidi
ty Both contemplate, as does the recommendation
of the President, a thorough revolution in the policy
and practice ol* the Government. From the origin
of the Government it has been the practice of the
Treasury Department to treat the notes of specie
paving banks as equivalent to specie ; and the joint
resolution of 181(?, expressly placed bank notes con
? vertible into specie, on the same footing with specie,
in the fiscal transactions of the Government, it is
true that, under the construction given to that act dy
the law-otticer of the Government, the late 1 rest
dent of the United States, caused an order to be issu
ed requiring payments for public lands to be made
in gold and silver alone, still leaving the other
branch of the revenue (the customs) to be collected
as heretofore, in the notes ol, or checks on, specie
paying banks. That order was understood, at the
time, to be issued for objects purely ot a temporary
nature, and as such, it may nave been a salutary
measure. But its continuance as a part ol the per
manent policy of the Government, was almost una
nimously repudiated by the voice ol the Representa
tives of the people antl of the States. ,
You well remember, Mr. President, that the dis
cussions to which this subject gave rise, during the
last session of Congress, terminated in the passage
of a bill, bv overwhelming majorities of bjth
Houses, distinctly re-affirming the principle of the
joint resolution of 1H1<?, in relation to the receivabi
lity of the notes of specie-paying banks, and con
taming also the significant provision that, in future,
no discrimination should be made between the dif
ferent branches of the revenue, as to the medium in
which they were to be paid. This bill received the
votes of nine-tenths of the members of this House,
and near three-fourths of the other. Still it did not
become a law. The circumstanccs under which it
was arrested in the ordinary and regular course,
and which alone prevented it from baiug now the
law of the land, are fresh in the recollection of the
country. I will not speak of them, for it is my sin
cere wish to keep out of the present discussion ev
en- thing which may awaken unpleasant feelings.
But this I will say, that no act of legislation was
ever the subject of a more watchful scrutiny, in the
various stages of its progress?few, il any, have
ever met a fuller discussion, or a more deliberate
consideration?none, within my experience, has
ever received a more unanimous and emphatic as
sent of the bodies by which it was passed. The
country, too, so far as 1 have been able to learn, and
1 have not been an inattentive observer of the evi
dences of public sentiment on the subject, has re
sponded, with a general voice of approbation, to the
decision of Congress, and warmly, and cordially
sustained it. It is that measlire, thus doubly sanc
tioned, with some modifications suited to the change
of circumstances, that I beg leave to re-present as a
compliance with the call of the President on Con
gress for further legislation, believing it to be adapt
ed to the exigencies of the occasion, as well as use
ful and salutary in its general operation on the cur
rt The principles of lhat bill were these. It declared
that the public dues should be collected in speeic or
in the notes of specie-paying banks, under certain
restrictions in regard to small notes, which were in
tended to operate the suppression, (ultimately, but
gradually,) of all notes under twenty dollars, and it
further provided, as I have already stated, that in
future no discrimination should be made between the
different branches of the revenue, as to the funds in
which they were receivable. These principles arc
incorporated in the bill, 1 now ask leave to present,
and in the very language in which they stood in the
bill of last session. The modifications of that bill
Which I have made, with reference to existing cir
cumstances, are these: In contemplation of the con
tingency, now. highly probuble, of an issue of
Treasury notes, 1 have introduced an alternative
clause, declaring that, in addition to specie and the
notes of specie-paying batiks, the public dues may
b- collected "in any oth'r medium specially nntfio
ri:nd bii law." The other modification has relation
t.the great desideratum of an early resumption of
specie payments by the banks, and consists in a pro
viso that "the notes of no bank which now fails or
may hereafter fail to redeem its notes in specie, shall,
at any time, be received in discharge of the public
dues," unless such banks shall, on or before a given
day, have bona tide resumed payment in specie."?
Tne object of this proviso is to designate a fixed pe
riod for the resumption of specie payments by the
banks, which may serve as a rallying point to them
all, and produce that concert and harinon v of move
ment without which this most desirable end cannot
b? accomplished. There will b; no dilAculiv, 1
think, from the data already in our possession, or ea
sily attainable, in fixing that period utiderstandingly
and judiciously. The mere designation of a day by
Congress will, itself, be powerfully operative in ef
fecting the result we aim at. You doubtless recol
lect, itfr. President, what was the effect produced by
a similar proceeding in 181G-'17. By the joint reso
lution of April lfi, the ',20th of February following
was fixed as the day for the resumption of specie pay
ments by the banks. The banks themselves deter
mined, in a formal convention held for the purpose,
not to resume 'till the 1st of July, '17; but the firm
adherence of Congress to their original resolution
forced the banks to yield, and they finally and si- ?
mnltaneously resinned specie payments on the \XHh
February, 1817, the day indicated by act of Con
The inducements to an early resnmpfion of specie
payments held out to the bonks by this bill are two
fold- It addresses itself both to their hopes and their
fears. It says to them, in effect, that 'vhenevcr you
resume specie payments, (provided it be before a
certain day,) your notes, under the restrictions of the
bill, shall be receivable in payment of every branch
of the public revenue, whetnei lor lands or customs;
but if you do not resume by that day , your notes shall
not be received in payment of public dues, even tho'
you inav thereafter resume. The banks will thus
be doubly stimulated to a resumption of specie pay
ments?bv the promise of a benefit on the one hand?
by the exhibition of a penalty on the other.
With these provisions, I do not doubt the early re
establish ment of a sound and healthy state of things.
What is the present condition of the country, and
what the treatment it demands'? If we look around
us, we find all the great sources of national prospe
rity still unimpaired?the land, the labor, the capital
of the country in their accustomed fertility and abun
dance. And yet industry is paralysed, commerce at
a stand, the currency degraded and deranged, the
prccious metals fled fro.n nictitation, the land over
run with spurioui or precarious substitutes tor mo
ney, exposing every inieieat of society lohMcurily
and hu^ard?an insecurity and huzuri Involving
alike the wages of labor, the value of property, the
ftilfilmeiit of contracts, all the acquisitions of the
past and all the hope* of the ftiiure. Now what is
the remedy for this extraordinary state ol the bidy
politic T It is comprehended in a single word. I lie
restoration of confidence.
It w?U bd itiluiiUiul, on till hiiuiis, that the first
thing to be brought about, wilh a view to the ainelio
r;ii iua of the present condition of things, b the re
turn lo specio payments by the banks. But that re
turn cannot bo effected without a restoration of con
fidence; and confidence is to be restored mainlv bv
the policy and example of the Ooveruinent. W illi
its aid in the re-esiuLlishincut of confidence, nothing
Is clearer than the ability of the bunks, ai an eafly
day, to resume and maintain specie payments. Let
us, for a moment, look at the condition ol the eoun
' try and of the bonks in regard to tho<e particulars
which form the leading elements of this question.
And first as to the stock of precious metals in the
country. The supply In the country Is mo?t abun
dant, lor ulitic*' a a g?*id deal has gone out recently,
to pay off our foreign debt, an equal, or nearly equal
quantity has come in. It is shown by official returns
that the importation* and exportation* of specie,
during the yew, very nearly balance each other.?
The quantity in the country, at this moment, accord
ing to the estimate* and statements we have received
from the Treasury Department, Is nearly three times
as t;iyat as it was four vcars ago. 1 he mcans to en
able the bulks to resume and sustain specie pay
ments are, therefore, ample and unquestionable, as
soon confidence shall be restored. I hen, as to
the balance of our foreign debt, which forms an
other important element ol this question it has
been in a course of coustant and progressive reduc
tion for the last six months, and with the aid ot the
new crop which is now coming in and the great di
minution of foreign imports, we shall soon see it en
tirely extinguished. At the same time, the great
mass of the banks throughout the country have been
diligently preparing themselves lor a return to specie
payments by a steady and judicious reduction of
their circulation
Nothing, then, is wanting to a speedy accomplish
ment of that great object but the restoration ol confi
dence, and it depends mainly on the action and poli
cy of the Government to supply that requisite. The
currency of the country is, at this moment, in the
condition of a human body in a state of suspended
animation?the heart still beats?the principle of
vitality is unextinguished?but the active functions
of life are suspended. Let the Government, but
breathe the breaih of confidence'into it, and it will
be at ouce resuscitated. It is the more necessary that
the Government should give its aid in this work of
restoring confidence, because, whether justly or un
justly, it is from the Government that the greatest
danger of hostility is apprehended. Let this appre
hension, then, be quieted by some pledge ot security,
by some token of encouragement and confidence.
The Senator from South Carolina, (Mr. Cai.hoi n,)
asserted yesterday, that the disease ot the country is
debt, the only remedy is time, and thai he relied much
more on the cotton and tobacco crops for relief, than
upon any action of the Government.?Sir, the debt
of the country, as 1 have already remarked, has
nearly reached i's extinguishment either by actual
payments or the bankruptcy of unfortunate deh ors.
But if this were not so, tne cotton and tobacco crops,
though essential ingredients of relief, do not super
sede the necessity of other, .and auxiliary remedies.
Examples are not wanting in the financial history of
this and other countries, to show the magical effects
of confidence in periods of great public distress, and
how that confidence depends on the conduct and poli
cy of the government. The year 1793 was a period
of the severest commercial distress in England.?
More than a hundred country hanks became bank
rupt, and the whole country seemed destined to a
similar catastrophe; when a single act of the go
vernment encouraging confidence, produced imme
diate and general relief. 1 allude to the offer made
by the British government, in that crisis of.suffering
and alarm, to lend to solvent dealers five millions of
pounds in Exchequer Bills. A considerable part of
the sura VH not taken or even applied for; but the
simple offer of the credit of the government, in restor
ing confidence between man and man, elicited the
dormant resources of the country, and relieved at
once the general distress.
We have had a similar and striking example in
our own country. You well recollect, Mr. Presi
dent, the memorable panic of 183-1, which ensiled on
the removal of the deposites from the Bank of the
United States. The storm which was raised on that
occasion, was directed chiefly on the great commer
cial emporium of New York. The legislature of
that patriotic and powerful Suite, with a paternal
sensibility to the interests and sufferings of her citi
zens, came forward and authorized the creation of a
stock of six millions of dollars to be lent to the banks,
for the purpose of sustaining thein under the extraor
dinary pressure to which they were exposed. What
was the effect 7 Not a solitary dollar was taken by
the banks, but the offer itself operated like a charm.
It restored confidence, and relieved Ike pressure. Thesa
examples may serve'to show gentlemen that there is
some practical virtue in confidence, and in the moral
power of the government to promote and encourage
it. What does the country ask at the hands of the
government, at the present moment 1 Is it a loan of
six millions ! No, sir.?The only loon that is asked,
the only aid that is wanted, is, that the Government
should not discredit, by its act, thp great circulating
j medium of the country, in which ninety-nine hun
j dredths of the transactions of society are negotiated
j and settled, when that medium shall b.- restored to
soundness, and brought back to the standard of con
vertibility into specie.
In connection with this subject, I beg leave lo call
the attention of the Senate to one remarkable con
sideration. It is this.?The President, in tracing the
causes of the present calamity, stales that the same
embarrassments and distresses have existed in En
I gland as in this country, arising from the samegeue
| ral causes, with this only difference in the result?
that here the banks have suspended specie payments,
while in England no such catastrophe has occurred.
This difference to my mind, comprehends every
thing. Ii is rendered the more remarkable by the
fact, that during the progress of these difficulties,
England was constantly losing her supply of the pre
cious metals, the stock of bullion in the banks having
been reduced from abaut eight millions to four mil
lions pounds sterling, (one half of her ordinary
quantity,) while in this country, during the same pe
riod, the precious metals have been steadily flowing
in upon us, and accumulating in an unprecedented
manner, so that, at the tiin'i of the suspension of
specie payments, we had three times the amount of
specic we ever possessed b ,'fore. According to these
circumstances, the results in th~ two countries ought
to have b ;en precisely reversed. We should have
continued to sustain specie payments here, while a
suspension of thein in England would seem to have
been inevitable. Why?has it been otherwise ! How
has it happened that England, with her Supply of the
irecious metals reduced to one half her usual stock,
las continued specie payments, while we, with
three times the amount we ever had before, have
been compelled to suspend specie payments? The
solution must b' found mainly in the fac(, that in
England, in periods of commercial distress, confi
de nr.', is always encouraged by government, while
here nothing was done by the government to ani
mate and sustain confidence. I do not mention this
as matter of reproach to the Government. It may
b?, thit the Government here believed, it had no con
stitutional faculty to interpose, in any manner, for
the support of confidence. But, unfortunately, di
rect and open attacks on the commercial credit and
institutions of the country, well calculated to destroy
confidence, were made in a quarter which, from the
rela'ion it b ire to the Government, gave rise to lively
apprehensions of hostility from the Government it
self. These apprehensions are now again revived
by the recommendation of the President?a recom
mendation which, if attempted, would, in inv hum
ble judgment, render the recovery of the country,
Irotn its prostrate condition, hopeless and impos
It is a matter susceptible of demonstration that if
the policy of demanding specie exclusively in pay
ment of the public dues shall now b ? adopted, it will
b> ut'erly impossible for the banks to resume specie
payment. It is an invariable law of currency, well
stated by my honorable friend from Georgia, (Mr.
King,) yesterday, (hat if there hj two currencies in
a country, one answering all the purposes of the
other, and a vaivnhle purpose besides, the currency
answering the additional purpose will always com
mand a premium. This is the condition of the
country, at the present moment. Bank paper con
stitutes the great ma*s of the circulation, while gold
and silver are only to b" had at a premium If the
Government shall now adopt the policy of requiring
payment of its dues in specie alone, this state of
things must h; perpetuated. Applicable lo all the
purposes for which bank notes can bo used, and over
and ab ive that, answering the important purpose of
paying the public revenue, from which bmk notes
will be excluded, specie, under these circumstances,
must continue to command a premium. Can the
buiks resume specie payments in the face of a pre
mium b >rnc by gold and silver 1 The very mo
ment i hey opened their vaults, the holders or notes,
m or ler to sc. ure the premium to b? obtained for
sperie, would make a general run upon* them for
ca-li; and if they opened their vaults it would only
be lo rlilM? I ,, ,,, * i
? But again, air, would not <Ue txmpU*f the Oo
.u il..- .. Oi* . rej?*iou ol all
iank paper, have a powerful iforul in(hw|i"-. in ea
eitmg ill* jeal.>i?sies an4?uspfHoiisof the ^hol<-com
munity f If the Uovernm. nl, by iM acts, ?ha 1 de
clan- bank paper to be worthless or unsafe, will not
the people also take the alarm 1 Will not a general
distrustV- created of all banking instiiuon*, and will
not every persun holding their paper become impa
| tient toconvett it into specie f In this pervading
I want of coutuleuec, tluur vaults would b-drained oi
every dollar they passed, it is demonstrable
therefore, that under the policy ol collecting the
dues of the government in hard money alone, we
never can accomplish that great object.in which the
whole country lut? so vital au interest?the resump
tion of s}?e< ic payments by the banks.
IIow does the proposition of the honorable Sena
tor from Missouri, (Mr. Benton,) bear ujion this
question f Its practical tttect, it I understand it
correctly, will be to enforce a ptwlly ujHjn the
banks for resuming specie payments ? In the
amendment offered bv htm there is a blank lefi for
the .lav, alter which the revenues are proposed to
b* collected in gold and silver only j and 1 under
stood the gentleman lo say il is his intention to
(ill that blank with the (lav on which the banks
would probably resume specie payments. 1 believe,
sir, said Mr. K., (turning to Mr Benton,) I am not
mistaken. (Mr. Benton?right, right.) Then, Mr.
President, here is a povitlve penalty denounced
against the banks, when they shall return to specie
payments. As the law now stands the notes ol sjic
cie-paying banks are receivable in payment of the
public revenue. The Senator is willing that this
should continue to b' the law, while the banks do
not pay specie for their notes; but when they do pay
specie, the honorable gentleman says to them, we
will revoke this privilege, thenceforward reject
your notes, though immediately convertible in
to specie, and declare that from and after the
day of your resumption, nothing .but gold and
silver shall be recetvedin discharge of the pub
lic dues. is not this, in effect, a direct penalty,
visited upon the banks for returning to specie pay
ment 1 Under such a policy, this great object of
public interest and anxiety never can be accomplish
ed; and I recur with confidence to my original po
sition that the only means by which it can bi effect
ed is a just, safe, and paternal policy on the part of
the Government announcing to the bmks, that, on
such conditions as may ba necessary to guard
against the recurrence of the catastrophe we are
now suffering from, we will receive your notes, cmi
twrlible into specie, in payment of the public dues, as
they have b'en received, by the practice of the
Treasury Department or by express enactment of
law, from the origin of the Government down to
the present lime.
1 have thus far, Mr. President, spoken of this mat
ter in reference totheparticularclrcmnstances of the
crisis, ami what appears to me to be the pressing and
paramount object to which the attention of every pa
triotic legislator ought to be directed at the present
moment?an early resumption ofspeeie payments by
the banks. But, looking at it in a Droadcr and more
general point of view, I ask, sir, upon what princi
ple of Republican government is it that the govern
ment can ba justified in drawing a line between it
self and the people?in saying there shall be one cur
rency for the Government and its officers, and an
other for the great body of the community?that the.
better currency shall be for the governors, and the
baser currency for the governed. Such 1 have
shown must be the effect of demanding the public
dues in gold and silver exclusively, while the great
mass of the circulation shall consist of bank paper.
Sir, I have always been taught to believe?my hon
orable colleague and myself learned it from the Bill
of Rights of our own State, as soon as We were ca
pable of reading?that a common interest between
the governors and the governed is a fundamental
principle of free institutions, that the best meahs of
"restraining the former from oppression, is to make
them feel and participate the burthens of the latter."
Let the Government share the same fate with the
citizen, and you give il the strongest of all motives
to watch over the general interests. On the other
hand, place it in a position different from that of the
great h nly of the community, especially in so vital
a matter as that of its revenue and pecuniary sup
port, and you make it, at once, callous and indiffer
ent to the sufferings of the people, and even eive
it an interest to per] e u.;te those sufferings. You
destroy all sympathy on the part of the Government,
with the people, arid you alienate the confidence
and affections of the people from the government.
What, sir, is at this moment the ungracious atti
tude in which the Government is placed towards the
people ? Its officers and contractors are paid in gold
and silver, or in Treasury drafts; made receivable in
discharge of public dues,"and therefore nearly equi
valent to gold and silver, while the community at
large are left to conduct their business, nAhey may,
in an irredeemable paper currency. Does riot this
operate as a virtual increase of the salaries of public
officers, in the midst of general distress affecting all
the rest of the community ? The gold and silver
which they receive, is at a premium of ten or twelve
per cent., and the Treasury drafts at seven or c^ht
per cent, above the actual "and common currencp of
the country. This premium is, I repeat, an addition
of so much to the amount of ilieir salaries; for, in a
practical sense, there has, as yet, been no depriva
tion in the Value of current bank notes. Theyjass
for as much in the ordinary business of life?in the
payment of debts?in the purchase of necessarieslind
conveniences?of whatever is worn, drank or er(en,
as they ever did. The premium, then, which the
public officers and contractors obtain on their fold
and silver, .and Treasury drafts, is so much dear
gain to them. Andat whose expense is it acquit-.I ?
Is it not at that of the great body of the people, the
ultimate tax-payers and supporters of Governn*nt ?
Does any one suppose that the importing raerclant,
who has to gi ve ten or twelve per cent, for the goM and
silver, and seven or eight per cent, for the Treifury
drafts, with which he pays his duties to the Govern
ment, does not add an equal amount, with the isual
profit upon it, to the price of his goods 1 It is, then,
Jhc consumer, at last, or in other words, the great
body of the people, who are subjected to increaseiflax
ation for the b.-nefil of the office-holder and the con
Sir, this is a state of things which I do not wisV to
see perpetuated. It is contrary to the genius ind
fundamental principles of our Republican syst'.m.
Of all schemes of policy I can conceive, that which
proposes a permanent distinction between the go
vernment and the people in their pecuniary interests
?one currency, and that the betler one, for the So
vernment, and another, and inferior currency, for
the people?such a system of discrimination" is, to
my mind, of all others," the most injurious and revolt- 1
ing in principle, the most heartless in character, and
the mast despotic in its tendencies. It is like quar
tering the Government, ns a foreign enemy, on the
heart of the country. You entrench it behind a
frowning fortification?surround it with battlements,
and lay the country, far and near, under contribu
tion for the support of this garrison of office-holders.
Desolation and oppression are without, while the
tenants of the citadel are revelling in luxury and pro
fusion within. I am not w illing, for oiie, to sec the
Government of my country placed in this anti-social,
if not belligerant, attitude towards the people. I am
not willing that this favored land, to which the na
tions of the earth are looking for a successful exam
ple of the practical enjoyment of free institutions,
should exhibit such a spectacle of inequality and op
pression in the eves of the world.
Much reliance, Mr. President, has been placed on
the popular catch-word of divorcing the Government
from all connection wilh banks. Nothing is more
delusive and treacherous than catch-words. How
often has the revered name of liberty been invoked,
in every quarter of the globe, and every age of the
world, to disguise and sanctify the most heartless
I despotism*. Let us beware in attempting to divorce
the Government from all connection with banks, we
do not end with divorcing the Government from the
pci'/d". As long as the people shall be satisfied in
their transactions with each other, with a sound,
convertible paper medium, with a due proportion of
the precious metals forming the bisis of that medium,
and mingled in the current of circulation, why
should the Government reject altogether this cur
rency of the peiplc, in the operations of the public
Treasury. If this currency be good enough for the
masters, it ought to be so for the servants. If the
Government sternly reject, for its uses, the general
medium of exchange adopted by the community, is
it not thereby isolated from the general wants and
business of the country, in relation to this great con
cern of the country. Do you not give it a separate,
if not hostile, interest 7 and thus, in effect, produce
a diroree betirrcn. Oorrmment and p'ople?a result, of
all others, to be most deprecated in a Republican
We have been told, Mr. President, of the embar
rassment* and inconvenience* to which the (iorcrn
mrnt is exposed, bv receiving its revenues in any
thing but gold and silver, in such an event as li.-.<
now overtaken the country and involved it in gene
ral distress. For one, sir, I cannot respond to this
appeal. I do not desire to see the Government placed
in a position that would exempt it from embarrass
ment, when the people are embarrassed. Would it
give any satisfaction to a patriotic mind, in the present
calamitous condition of the country, lo see treasures
of gold and silver pouring into the coffers of the
Government, while the people are suffering all the
evils of an irredeemable and depreciating paper
currency. For myself, I am free to say, that neither
a> a eiti7.cn nor a^ a repie'entative, having it in my
power, |f I would, IO parti<-i{>at9( In tome degree, in I
ilieM- |x?culii?r advantages (it the Government, could
such ? 4f? ol ihi?f? minister ibr slightest graiifica*
ikm) to Be 1 No, sir, iny heart iisonns the thought,
80 far from it, the contrast would be but a new leu
lure added lo th<- mortifying and distressed condition
of the country, and easting reproach upon our insti
tutions, whicli admitted .such an unuutural and anti
republican inequality. If anything could wake your
Government a callous and indifferent spectator of the
iuilferin:?> ot the people, refusing a helping hand to
their relief, and mocking w hen their (ear coineth
on," It would be to place it in a position like this.
No, sir ; whenever the people suffer embirrasMiieiit,
embarrassment should be felt by the Government,
that It may be stimulated, through experience of the
common suffering, to do all it can to prevent or re
lieve that suffering. 1 am for holding the Govern
ment, in all things, to a cirmmtm fate with the people,
so that whatever touches the one, shall be Imme
diately felt by the other. Let tlie condition of the
Government auswer to the condition of the people,
so that the conduct and |>olicy of the one may, with
equal fidelity, reflect the interests and sentiments of
the oiher.
This, sir, is the principle which has always guided
my views in regard lo the great question oi the cur
rency. N"o one desires a sound reform of the curren
cy more than 1 do ; but 1 wish to improve it for the
btiiielil of the people as well lis of the Government.
I desire to see a large infusion of the precious metals
into the general circulation and business of the
country, and not a monopoly of them bv the Go
vernment. This great object can be effected only
by the suppression of bank notes of the lower de
nominations, and not by demanding gold and silver
alone in payment of dues lo the Government. Let
all notes tinder twenty dollars be gradually sup
pressed, and you will have an abundance of gold
and silver in common circulation, passing from hand
to hand in the common business of society. That
will be a salutary and beneficent reform enuring to
the advantage of the great b xk of the people, as well
as of the Government; and when it shall have b*en
accomplished, when gold and silver shall thus have
bv'come the common currency of the country, you
! may, without hardship or injustice, demand payment
of the public dues in the precious metals. But this
mosi desirable result, the general circulation of gold
I and silver in the common business of life, never can
| be effected, (as I think 1 have fully shown on another
occasion.) without a previous suppression of bank
notes of the lower denominations. ' In every scheme
of reforming the currency, which looks to the bene
fit of the people as well as of the Government, this is
the great point to be aimed at. It was- the leading
object of the measure I brought forward during the
last session of Congress, and which then received the
almost unanimous sanction of this House, and the
assent of a large majority of the other, though l'rpm
causes to which 1 have already alluded, it failed to
become a law. The same measure, in all its essen
tial principles, I now again submit for the considera
tion of the Senate.
The President, sir, in his Message, tells us that
the requisition of gold and silver in payment of the
public dues would have " a direct tendency to pro
duce a wider circulation of the precious metals, to
increase the safety of bank paper, and to improve the
general currency." I desire to treat the opinions of
the President wi'tli all possible respect?a respect felt
alike for the individual and the magistrate?but un
less I havs wholly misconceived the elementary
principles which belong to this subject, as well as
their obvitus practical operation, it is impossible to
sustain any one of these positions. How, sir, can
the collection of the revenue in gold and silver, tend
" to widen the circulation of the precious metals?"
It is a we# known and invariable law of currency,
that banknotes and coins of the same denomination
cannot circulate together. It is in vain, then, to at
tempt to iciden the circulation of gold and silver by
any other means than by the suppression of bank
noies of the lower denominations. But, not now lo
dwell o? this view of the subject, (which 1 have fully
developed and enforced elsewhere,) I maintain that
the collection of the public revenue in gold and sil
ver, while the common currency of the country con
sists of bank paper, instead of widening the circula
tion of those metals, would have the effect of taking
them, out of general circulation altogether. In the
remarks I have already made, I think it has been
satisfactorily shown, that the necessary effect of this
policy vouliil be to cause gold and silver to bear a
premium. Bearing a premium, they would not cir
culate as currency at all, but would be at once, con
verted into an article of merchandise. The public
deb'.or would buy them of the broker to pay his dues
to the government; and when paid out to the public
creditor, he would go and sell them again to the
broker. Instead of entering into circulation, all of
them that were seen, would be restricted lo this nar
row round of traffic, while the great mass of them
would be withdrawn from public view, as well as
Then, sir, as to the tendency of this policy to
" increase the safety of bank paper," would you
increase the safely of bank naper by abstracting
the fund for its redemption 1 Yel such would be the
plain operation of this policy. The Secretary of
the Treasury Iihs referred to the condition of the
Treasury in lfcl34, as affording a general average to
illustrate the operation of the new financial system
he proposes. In looking at the Treasury statement
for that year, I find that the average amount of pub
lic moneys on deposite in the city of New York, dur
ing that year, was about five millions, while the
whole amount of specie in the banks of the city
was about two mil ions. Taking this as a fair ave
rage for that city, what would be the influence of
this new policy of collecting the public dues in gold
and silver, on the safety of bank paper there! Where
would you get the five miliums of specie to meet
this demand for the public revenue? It is evident
the banks would be drained by it of their stock of
the precious metals, and the community would thus
be deprived of the security on which they relied for
the soundness of the bank paper held by them. The
" improvement of the general currency" then, which
the President anticipates as the result of the policy
he proposes, would, unless the principles heretofore
received as incontestable truths on the subject of the
currency, be utter fallacies, amount to this, that the
precious metals would no longer form a part of the
general circulation?that they would cease to be cur
rency, and become mere articles of merchandise, to
be obtained only at a premium, and that the specie
basis, on which the soundness and safety of bank
paper ID mainly depend, would henceforward, to a
great extent, be withdrawn and monopolized by the
But it has been said, and I regret fo perceive that
the idea is countenanced by the high authority 'of
the President, that the general currency of the coun
try is a matter with which this Government has no
thing to do?that its duties arc confined to the exer
cise of the coinage power and the collection of its
own revenues in gold and silver?and that the gene
ral circulating medium of the country must be en
tirely abandoned to the separate and often conflicting
control of the individual states. Now, sir, as my
opinions differ alike from this view of the subject,
and from that urged a few days ago, by the Senator
from Massachusetts, (Mr. Webster,) 1 beg leave to
state briefly what they are. The whole history of
the formation of the constitution, as well as the in
ternal evidence of its provisions, prove beyond ques
tion, that the framers of th.1t instrument intended
that there should ben common currency for the Union,
and not "as inanv different currencies as there are
states." They, doubtless, believed that that curren
cy would consist, almost entirely, of gold and silver.
There were but two banks then in existence, whose
issues formed an exceedingly small part of tin- ge
neral circulation. They no more foresaw that im
mense multiplication of banks, which has made
bulk paper ihe actual currency of the country, than
they foresaw the two great discoveries of the age,?
stcrimb tats and railroads?which have had so extra
ordinary an influence on the wealth and resources of
the country. Believing that gold and silver would
continue to constitute the currency of the country,
they placed Ihe "regulation" of that currency ex
pressly under the control of Congress, and took it
ttway, in terms equally express, from the states. But
white they did this, they left with the states (for the
omission to take it away amounted to the.same
thing) the power of incorporating banking institu
aons. In the general and extensive exercise of that
power by the states, ihe issues of the banks have
?ome to take the place of gold and silver, and to
iirm the actual currency of the country. In the
practical working of our system, then, a state of
things has grown up entirely unforeseen by the
^Hinders of the constitution. ? This Government has
no authority, by force of law, to put an end to that
stftte of things, nor is It desirable, considering the
many and indisputable conveniences of a sound pa
per currency in the present advanced stage of com
merce and civilization, to destroy it altogether. But
as the original design and intention of tnc constitu
tion certainly was that there should b'a common cur
rency for the Union, it is incumbent upon Congress,
'^ttfte^j^rcise the pntrers delegated to it, to do all.
it can toIStjd jbat design, and to render the actual
currency oftne country as sound, as equal, and as
nearly equivalent to gold and silver as possible.
This duty is essential totheharmony and friendly
intercourse of the states, and is indeed intimately
connected with all the objects of a common gorcrt1
ment which led to the establishment of the constitu
tion. But this duty is to be measured by the extent
of the powers which have been delegaied to Con
gress; for ii must always be borne in mind that ibis
Government can exercise no other powers than such
! as have been specifically delegated k< il. Now what
art (In**- powers, in regard to the question of the
currency 1 Tlu- Senator fr<)i(pMa"*sa? buaetts, (Mri
Webster,) argued, the other day, as If the constitu
Oonltad given to Congress a substantive and plenary
tsiwer lo " regulate the currency," to nomine, and in
terred from thence the power lei establish ? National
Bank to regulate the issues of ihe S<ate Banks,
which form the actual currency of the country. Hut.
in the first place, the constitution ha.s not delegated
to Congress any general or subsUinlive power to
' irX*late Uu currency," nor has it any where, eillier
by express grant, or necessary iiuplica ion, given to
fongreae the power to create a banking corporation.
What then are the powers it lias vested iu Congress,
on the subject of the currency 1 In the first place, it
give* to Cungreci "the |>ower to coin money and re
gulate the value thereof." Bui since the precious
metals form eo small a part of the actual circulation
of the country, thin power, however important in it
self, can exert no controling influence on the general
currency. We then find that the constitution gives
to Congress the power "to lay and collect taxes, du
ties, Ac., to pay the deb's, &c., of the United 8iates."
From the large amount of the receipts and disburse
ments of the Government, this power is susceptible
of an extensive and important bearing on the gene
ral currency of the country. In the exercise of It,
it is incumbent on Congress u> make it instrumental
to securing to the whole country, as far as possible,
the benefits of a sound and equal currency, equiva
lent every where to specie. It may be .so managed,
by receiving the paper and employing the agency of
tfie State Banks, in ihe fiscal operations of the Go
vernment, under certain salutary restrictions and
conditions, as to impart to the issues of those banks,
forming the actual currency of the country, some of
the most essential qualities of a sound, stuble, and
equal circulating medium. But if, on the other
hand, this incidental control, through the revenue
power of the Government, over ihe actual currency
of the country, is to b? abmdoned, and that curren
cy lie relegated exclusively, as is now promised, to
Ihe separate and conflicting legislation of the indi
vidual states, our whole monetary system, affecting
so widely and deeply the interests of society, must
run into wild disorder and confusion, and one of the
highest objccts of the constitution be nullified and
This, sir, was the doctrine steadily maintained by
the late administration. From the removal of the
Deposites from the Bank of the United States, down
to the close of that administration, it was constantly
put forth, in bold relief, in Ihe Messages of the Pre
sident, and the Reports of the Secretary of the Trea
sury, as well as in the Speeches of its leading friends
in this and the other branch of Congress. The obli
gation of the General Government to watch over the
general currency, and to secure to the whole country,
as far as possible, the benefit of a circulating me
dium that should be sound and of equal value, was
distinctly recognized and admitted; and it was con
tended Innt this object could be as effectually accom
plished through the State Banks, as by the agency of
any national incorporation. The management of
the Yevenue, through those institutions, was to be the
instrument by which the end was to be accomplished,
and the particular means relied on, was to make a
suppression of the small notes, and some other re
forms in the currency, the conditions of a depisite of
the public funds in the banks, and of the rcceivability
of their notes in payment of the public dues. By ihe
employment of these means, the late President, in his
last annual Message, but one, to Congress, said, "we
should soon gain, in place of the Bank of the United
Slates, a practical reform in the whole paper system
of the country," and, looking forward to the ultimate
suppression til all b;ink notes beloir tirenly dollar* as
the result of this policy, he hailed it, with enthusias
tic patriotism, as "formingan era in the history of
our country, which would be dwelt upon with de
light by every true friend of its liberty and inde
pendence." The present Chief Magistrate, in his
celebrated letter lo a member of the other House,
speaking of this same policy, said, " nothing but a
Jaithful prosecution of il by the General Government
and the States, is necessary to place us on a footing
of equality with other nations," enjoying, in the
highest degree, the advantages of a stable and uni
form currency. To all this, I was n sincere convert,
and am still. I still believe thai it is the duty of this
Government?a duty from which it cannot free it
self, without betraying one of the highest objects of
the Union?to exercise a superintendence, in all
constitutional modes, over the general currency, so
as to secure to the irkole country, a sound, stable, and
as nearly as may be, uniform medium of exchange;
and, to use the language of the late President of the
United States, that " tne management of the public
revenues, through the Slate Institutions, may and
ought to be made auxiliary" to the. accomplishment
of this great end.
( To be concluded.)
Saturday, Sept. 30.
A memorial of a private character was presented by
Mr. Young.
Mr. BUCHANAN presented several memorials re
monstrating against the admission of Texas into the
Mr. PRESTON said he had several petitions on the
subject but he had refrained from presenting them be
cause it wa? the understanding of tho Senate that none
but the special business of the session could be acted
on. It might be suspected from the patience of the
Southern delegation, that they are about to suffer this
question to go by default. But he would take this oc
casion to state their determination to disallow the prayer
of these petitioners ; and he would himself, as soon as
the rules of parliamentary order would permit, submit
a proposition which would at once test the opinion of
Congress and the whole country .ou that important
The Senate then agaiirtook up the Treasury bill, with
Mr. Calhoun's amendment.
Mr. PRESTON resumed the floor in continuation
of the remarks he commenced yesterday, and spoke
about three hours, in reply to his colleague, ^Mr.
Calhoun,) and other members who had advocated the
Sub-treasury and hard money schemes.
Mr. BROWN, of North Carolina, followed in a
speech of about an hour m favor ol' the bill, &c.
The Senate, by general consent, laid aside this bill,
and proceeded to the consideration of the amendment
of the House of Representatives to the'
The amendment of the House limits the operation of
the bill to jauusrv 1st, 1833; that is, postpones the
payment of the instalment to that period instead of in
Mr. WRIGHT said tho amendment had been inform
ally examined by the Committee 011 Finance, and they
had recommended that the Senate unanimously agreo
to it. '
After some remarks from Mr. TIPTON against the
bill, he having called for the yeas and nays, the ques
tion waa taken on the question to agree to the amend
ment of the House of Representatives, and decidcd in
the affirmative as follows:
YEAS?Messrs. Allen, Bayard, Benton, Black,
Brown, Buchanan, Calhoun, Clayton, Fulton, Grundy,
King of Alabama, Km^r of Georgia, Linn, Lyon, Mor
ris, Nicholas, Nilcs, Norvell, Prentiss, Hoane, Rob
inson, Smith of Connecticut, Strange, Swift, Walker,
Wall, White, Williams, Wright, Young?30.
NAYS?Messrs. Pierce, Tipton?SJ.
Mr. GRUNDY, from the Committee on ihe Judi
ciary, to whom the subject had been referred, reported
a bill to regulate the fees of District Attorneys for the
renewal of custom-house bonds. Read, and ordered
to a second reading.
This bill fixes the fees lo five dollars for each re
Tho following resolution was presented by Mr.
BLACK, and by unanimous consent, adopted:
Resolved, That the Secretary of the Senate deli
ver to the Commissioners of the General Land Office
ten copies of the State Papers, published by Duff
Green, on the public lands.
The Sub-treasury bill was again taken lip, and,
On motion of Mr. BAYARD,
The Senate adj'd.
Friday, Sept. 29.
The House resumed the consideration of the mo
lion submitted by Mr PICKENS, on yesterday to
reconsider the vote on the bill to postpone the fourth
instalment of deposite with the Stales.
After some remarks from Mr. TOUCEY,
Mr.CAMBRELENG moved the previous ques
tion, which, after a call of the House, was seconded
without a division.
The main attention was ordered to be put, and be
ing put, was decided in the affirmative, as follows:
Yeas 149, nays HI.
So (he motion to reconsider wan agreed to.
Mr. PICKENS then submitted hi* amendment to
strike out of the bill, " until further provision bv
law," and insert. " until the first of January, IKK*"
In Mibmilting this amendment, tie would merely
say that it was not his intention to debite it further,
and he hoped and trusted that we might be enabled
to lake the vote withput much further debate, be
cause he was satisfied that the H<nj?e must b;- ex
hausted, and the subject thoroughly understood. He
hoped gentlemen would not protract the discussion,
and that the previous question might not again be
moved until a vote was taken uinin this amendment.
Mfssru. 11AYNES, AUAMS, and LOOM1S,
suggested some amendments, which were negatived.
Mr. COLES moved to lay the bill on the table.
Lo-i, yeas 101, nays 132.
Mr. BELL moved to recommit the bill, for the
purpose of substituting for it certain provisions to
enable the States to receive the instalment from the
banks in which it is deposited, in diflcrent portions,
between the 1st day of October, 1H3H, and the 1st day
of October, 1K10 Mr. Bell spoke at length in sujv
port of this proposition; and it was negatived. Yeas
6-1, nays 119.
Further amendments were offered bv Messrs.
PHILLIPS and HARLAN, and disagreed to.
Mr. PICKENS' amendment was adopted. Yeas
130, na^s 90.
ArftSr some other ineffectual attempts to amend,
'Mr. HA YNES called the previous question, which
was seconded, and the main question was ordcied to
be pu'.
The hill, as amended, on motion of Mr. PICK
EN'S, was then ordered to a third reading. Yeas
ION, nays lOti.
The bill being read a third time,
Mr. RICE GARLAND moved to pospme the
further consideration of the bill until Tuesday next.
Mr. G. ad vocaled his motion ou the ground that
he did not wish the deposite banks in his State to be.
left at the mercy of the Secretary of the Treasury;
and he therefore wished to defer the postponement
of the bill till the bill to settle with the deposite banks
was acted on.
Mr. CAMBRELENG said, for himself, he was
disposed to deal as generously with those b^iks as
circumstances would admit; for, though no friend
to the .banks, yet he was willing to afford them every
indulgence, for the sake of the people who were in
debted to them.
Mr. GHOLSON said he was in favor of this mo
tion. Sir, I have been the friend of this bill at every
and all stages of its progress. 1 have been here for
the last twenty-two days, giving my aid to this bill;
but, sir, now that the struggle is over, I, as one of
the friends of this bill, and as one of the Represen
tatives of the State of Mississippi, in which is one
of the deposite banks, having a large amount of pub
lic money, about which so much has been said dur
ing the progress of this debate, by gentlemen on this
tloor, think it impolitic to permit this bill to pass out
of our reach until we have had the action of this
House on the bill to regulate the settlement of the
Government with the deposite banks. Sir, as much
as the interest 1 have felt for the passage of this bill
has been, 1 feel more interest in the protection of the
deposite banks, for the obvious reason that, by the
protection ol the banks 1 protect those indebted to the
The motion to postpone was then disagreed to?
ayes 74, nays 97. . .
' Mr. CHAMBERS of Kentucky, after address
ing some remarks to the House, moved an adjourn
ment. Lost.
Mr. McKIM then moved the previous question,
which was seconded; and the main question hav
ing been ordered, the bill was read a third time, and
On motion,
The House adjourned at 11 o'clock, p. m.
Saturday, Sep. 30.
After the presentation of memorials,
Mr. TOLAND, by leave, called up the follow ing
resolution offered by him yesterday, in the follow
ing words:
Hesolrcd, That the Secretary of the Treasury be
directed to communicate to this House copies of all
official correspondence between the Department and
all individuals, banks, or other corporations, relative
to a bill now before Congress, to authorize the Pre
sident of the United States to cause the issue of
Treasury notes, and relative to the disposition of
such notes; together with copies of all documents
or papers on file in the Department relative thereto;
ana after some conversation, the resolution was
agreed to.
Mr. CAMBRELENG, by order of the Committee
of Ways and Means, reported, without amendment,
a bill from the Senate to remit the duties on goods
destroyed by fire in the city of New York, and it
w as referred to the Committee of the Whole on the
stale of the Union.
Also, the following amendment on the Senate's
bill extending the time on merchants' bonds;
Strike out the second section, and insert:
" And be it further cnacted, That a credit of three
and six months shall be allowed on the duty on all
merchandise which shall be imported on or before
the first day of November next, upon which the
duties are payable in cash, and that the bonds re
ceived for such duties shall be payable in equal
instalments, bearing interest at the "rate of six per
cent, per annum, and shall be in the form and upon
the conditions prescribed by existing laws, and by
this act." s
The bill and amendment were referred to the
Committee of the Whole on the state of |hc Union.
The House next proceeded to the consideration of
the resolution reported from the Committee of Ways
and Means, that it is inexpedient to. establish a Na
tional Bank; when
Mr. SERGEANT resumed the course of his re
marks in opposition to the resolution, and continued
them till the expiration of the morning hour.
Mr. ROBERTSON, of .Virginia, on leave, of
fered an amendment to the amendment to this effect:
to insert after the words " at this time," the following:,
"nor ought such an institution to be chartered at any
time hereafter, unless an amendment to the Consti
tution shall expressly delegate to Congress the power
so to do."1
The House then passed to the Orders of the Day,
and went into Committee of the Whole oh the state
of the Union, (Mr. Connor, of North Carolina, in
thechair;) when, on motion oi Mr. CAMBRELENG,
the Committee took up the bill from the Senate au
thorizing the issue of Treasury notes.
Mr. BELL said he had been waiting for some who,
he understood, were prepared to contest the constitu
tional right of the Senate to send to the House-a bill
of this description. It was a money bill r and, by the
Constitution, all such bills must' originate ih the
House. The proper course would be, first to take a
vote on that question. If his friend from Massachu
setts was desirous of addressing the House on that
question, Mr. B. would not now proceed with any
remarks on the bill. ' 4
Mr. ADAMS said that in his own opinion the
matter admitted of no question at all. Ifevertheie
was a money bill, this was one. But he should make
no motion, because he knew perfectly well if he did,
the previous question would be called, and the mo
tion voted down. If, however, the gentleman from
Tennessee (Mr. Bell) was disposed to go into the
discussion, lie should have Mr. A.'s most cordial
support. This House had too long suffered the other
branch of the Legislature to dictate to it every mea
sure relating to revenue. For the last five years not
one of all the measures of that character had origi
nated in that House.
After some further conversation, Mr. CAMBRE
LENG moved to lay the Senate bill aside, and on his
motion, the House bill was taken up.
Mr. CAMBRELENG then submitted a statement
of the assets and liabilities of the Treasury, as fol
lows :
Estimate of the state of the Treasury, and of its out
- standing resources and liabilities on the 1st of Ja
nuary, IH38, excluding the amount deposited with
the States, and assuming that ten millions of Trea
sury notes will have been issued, and that all the.
custom-house bv>nds and claims upon the banks be
postponed till next year.
Estimated to be in the Treasury on the 1st October?
In money, ------ i,000,000
In the mint, .... 500.000
Estimated receipts in the last quarter?
From lands and customs, - . . . 2,000,000
From Treasury notes, ..... lojioo'ooo
Expenditures in the last quarter, in
cluding new appropriations made at
the present session for the Florida
war, the expenses of the session, the
payment of debentures, &c. ... 10,500,000
Outstanding resources?
Probable amount which
will remain unpaid by
the banks, and pay
able in 1H38, ...
Custom House bonds
payable in IN3H, . .
Bonds in suit, - - .
Bonds due from the suf
ferers by the fire in

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