The Madisonian. [volume], October 14, 1837, Image 2

About The Madisonian. [volume] (Washington City [i.e. Washington, D.C.]) 1837-1845

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eetion in the njr, I would InAniiely prefer resign
in^ my mm ??? v?*?* <?* h- J
tl*i? HirrjuesiiJli tfi?r sincerity oT^enUMlA^BronaVe
changed, but I protest that b.cau*e I cannot change
aUo, i slioulU h; denynnced.
iVlr. Chairman, it' 1 aui to be tried on a charge of
desertion, the adiniui.-traiiou shall not judge me; its
friends on thi> floor shall not judge ine?/ rOltotn
ed h my constituents alone?they know what opinions
they seui me here to susUkin?they know which
have deserted, and which I have maintained. I will
meet them and lei them pronounce the judgment;
and if that judgment slfitll be?guilty, they fcloue
shall b*j my executioner?*?lo them, by iheir coiiji
dence, I came here?bv their command 1 am ready
to retire. To them and iheir justice 1 commit my
self. 1 will say to them, thai,
Bound by no party's aibiirary sway,
I'll follow Ttti'TH, irker'er it l~adi the
irny.
APPENDIX
Comparative SUi'w rit of the condition of the Farm
er't Bank oj Virginia and Brunches, on tht' 1st and
tith days of June, 1837, and on Uu Ut day of SefA
temier, 1837.
Bills db. at Richmond,
Norfolk,
Petersburg,
Fredericksburg,
Lvnchbirg,
Winchester,
Danville,
1st June. 1st Sept.
?2,546,HOI ft--',260.7%
t4H,705
608,499
497,H65
5 >I?,H77
419,999
403,214
707,091
52tir>7ti
536,318
588,199
40H,5W
290,029
5,ftl!),763 5,177,-283
Showing an aggregate deerense of $372,380, in
the outstanding bills discounted between the 1st day
of June, and tne 1st day of September, 1837.
The specie on hand on the lsi Sept. 1837,
was $4*25,234
On the 8i hday of June, it was 412,672
Showing an increase of spccie
The notes of other Banks on hand on
1st September, 1837, was
On the 8th of June, 1837, they amounted to
Showing an increase of
The aggregate balances due by the other
Banns, was, on 1st September,
On the 8ih June, they amounted to
Showing an increase of
The notes in circulation on 1st Sept.
1837, were
The deposite money at same time was,
individuals,
Treasurer of the United States,
12,563
$-218,841
127,842
90,999
$15,074
20.267
?24,807
The linblities on 8ih June, 1837, were,
Notes in circulation, $1,963,342
Individual deposites, 1,500,076
Treasurer of U. Slates .297,047
2,196.601
900,833
118,173
$3,215,610
3,761.065
Showing a diminished liability
equal to
The contingent fund, to cover losses
.was on 1st September,
It was on the 8tn June,
Increase,
545,155
$369,771
277,412
92,369
The whole bid anddoub'fiil debts on,1st September,
1837, were estimated as follows:
$59,398
226,036
6,100
At Richmond,
Norfolk,
Petersburg,
Lynchh'i rg?none
Fredericksburg,
Winchester
Danville
In all,
While the contingent fund is as nbjve
? stated.
3,950
17,526
1,000
324,003
369,771
From the foregoing, the following statement may
bo made, showing the increased active means, and
the diminished liabilities of the Bank, viz:
Increase of specie, $12,562
Do of notes of other Banks, 90,999
Do of debts due by oiher Banks, 21.807
Do of contingent fund, 9"!,366
Decrease of notes in circulation, &c., 5-15,455
Making in all, 776,192
Against which, the loan from the Commonwealth;
under the ac: of 24th June, 1837, may be made an
offset.
Condition of the Boston Banks, omitting Massa
chusetts, Franklin, and Lafayette Banks, at the
close of business, Sep'. 16, 1837, agreeably to returns
made to the standing Committees:
Capital $24,400,000 00
Circulation 1,938,326 00
Individual deposites 6,327,561 17
Specie 1.048.348 00
Real estate 653,523 15
Amount of loan 33,359,510 93
General ttaie of the Bank of Virginia on the 15/A duy
of Augunt, 1837.
Loans and discounts, .... $7,764,903 77
Stocks, - 36H.18I 59
Real Estate, ..... 303,565 '25
Due from other Hanks, - - . 821;9I8 76
Specie, 4*26,429 76
Other investment*, (balances due from
offices, 399,710 09
Expenses. 9,780 85
810,094,555 04
Capital Stock, ? ? ? -
Contingent Fund, ...
Discounts received, profit and loss, &c.
Deposite money, Treasurer
U. States, - - $395,0186 61
Treasurer Commonwealth, 181,903 33
Other Deoosites, - 1,373,879 55
Due other Banks, ....
Circulation, .....
Other liabilities, notes pay
able to Bank U. S., $>'279,252 88
Bond to Commonwealth, 325,000 00
Balances due to offices, 437,907 29
$3,240,000 00
590,387 40
65,696 47
1,950,854 52
393,308 77
2,812,088 31
1.012,220 n
$10,094,555 04
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?J (T 5 T
RPKBCH OF MR. KI.\?,
or CEORGtA,
On the hill imposing additional duties, of d<-pnsiitirirs,
in certain easts, on I'uhlic Offiar*. Dr/wml in
the Senate of the I'nited States, Septemlx-r 23, lh37.
The Senate hating under consideration the hill im
posing additional duties,as depositaries, in ccrtain cases,
on public officers?
Mr. KINO, of Georgia, said that he had not intended
to address the Senate on the subject before it until yes
terday evening He had great difficulty in making up
hit mind between the projects urged by different gan
,iltm.tnrjiuclun?.hi> w^uyl satisfied wiib*itb?r of them,,
lie lud thtfught it tx-?t K poaiponu the subject nil the
regular iruiua, and ?T?r souie remarks IU explanation
of in* reasons for doing eo.
Two plans were, he said, urged upon the Senate:
one re|Hirlcd by the Committee on Finance, a? propos
ed lo be amended by the Senator from South Carolina ;
the other, the State banlt system, which had already
been tried, and failed.
As to the last, vartoua apologies had been made here
and etaewbere, for its failure ; and it haa been instated
tiiat it had not a fair tr.al, and, therefore, could not be
said pru|ierlv to have failed The most able aud inge
nious advocates and apologists of this system that lie
had heard were lua friends fro.n* Virginia and New
York. If they had not succeeded in convincing the
Senate that the system should be re-adopted, (with the
moderations proposed.) conviction might be considered
as hopeless He certainly agreed with them, that the
system bad not had a lair trial The pets had certainly
had a hard time uf it under their Executive patron; but
be had never bad confidence in them from the begin
ning. and, in truth, the aystem had never succeeded for
one moment. The history of I be world furnishes no
instance in which an administrative measure, so vitally
interesting to the whole community, liad been so long
su*taiiicd by a system of mere assumption, deception,
and pulling Business men wern rarely deceived by
these means ; but a large portion of the people were
less informed, and believed the statements which weaJ
from time to time im|tosed upon them Why, (said
Mr. K.) ( lately saw in one of the numerous apologetic
essays on this subject, (even when the exchanges had
got into such coiifusion as to render it impossible to de
ceive any body,) that the system had been one of the
most be mful in its operation ever devised by the wis
dom of man. The author regretted very much that he
was not entitled to anv share of the honor of having first
conceived it; which honor was all due to the great
financial wisdom of tho Ex-President. The fruits of
this mighty conception had, however, been blasted by
the stupidity of Congress, who had passed, contrary to
the known will of the Executive, the obnoxious mea
sure for the distributive deposite with the Slates in
Juue, IHJO. A beautiful system, truly, for the admin
istration of the public finances, that should wither at a
hint that we should want a (lortion of the public treasure
in quarterly instalments ; theJiett becoming due more
than six months ahead Hut, said (Mr. K ) unfortu
nately, this bill was passed rather too late to sfford
even a pretext lo the advocates of tlie late President's
experiment. I state to the Senate as a fact coming
within my own knowledge, thai, before the distribution
biU iras passed or talked of, the president of a Southern
institution passed through this city, with a large amount
of specie in his |>osscssion, on his way to New York,
there to purchase Southern aud Southwestern exchan
ges. The sume operation had been made by others.
Was such an operation ever made or dreamed of during
the existence of tho Bunk of the United States before
the withdrawal of its blanches ! A beautiful system of
exchanges, tins, which would lead men a thousand
miles from home to shave the commercial paper of their
J neighbors!
Here are the evidences of the fulfiment of the promi
! ses, that the experiment would give us a better curren
| cv, safer depositories, and a "cheaper" system of ex
j changes. The local banks, whilst the deposites in
! their vaults were large ; the currency expanding; and
I speculation furnishing demands for money every where,
I and credits every where, afforded exchanges tolerably
J well between the most commercial points ; but the mo
| tnent these causes ceased to operate, and the branches
! of the United States Bank were withdrawn, the exchan
ges fell into the utmost confusion, and every pretension
after this that they were furnishing exchanges as cheaply
" as the United States Bank ever did," has been mere
assumption, and not calculated to deceive any business
man in the community. Sir, (said he,) I have gone to
the very counters of these bank and asked for exchan
ge at the published The answer tfenerally was,
that, "1/ they vu , iwing," they would sell at tho
published pn. <?*, bur they rarely had any to sell.
Now. sir, what kind of a protij, do you suppose could
have induced the strange operation I have described !
I have been informed it frequently amounts to 15 aud
17 per cent. ; sometimes less, but always enormous.
Titc operation, if I understand it, was this ; A bill was
purchased in New York on the debtor of the drawer in
the South or West, or Southwest, at a discount from
four to six per cent, and perhaps sometimes higher If
the bill were paid the purchaser (being established be
tween the drawer aud drawee) again sold a bill drawn
on the fund, and charged a premium ; for these great
repulaters were in the habit of sharing in terry direc
tion. They would buy Southern funds at a heavy dis
count, and sell a bill on it at a heavy premium. This
was the operation if the bill were paid, but if the bill
were dishonored, ps frequently happened before, and
nearly always after tho adoption of the specie circular,
the bill went back ojiou the New York drawer with an
accumulation of charges, and five |ier cent, damages fur
the dishonor. The drawer had it to pay, though be had
suffered a heavy loss on the discount. The payment of
bill and damages furnished the drawer with a Northern
fund, on which he could again draw a premium at five
per cent. Thus the Senate will see the enormous pro
fit that was often made by the discount of a single bill.
It was from exchanges, added to other profits, Mr.
Kino said, that accounted for the enormous profits and
heavy dividends that had been made by some of , the
banks, some of which he mentioned to have lieen prodi
gious within fourteen months proceeding the 1st of
March, 1837. Where did these enormous profits come
from, sud who ultimately paid them 1 Why, they were
shaved from the hard earnings of the industrious classes
being clearly a tax on the circulation of the products of
labor.
Mr. K. said he would not detain the Senate by going
fully into the capabilities of the State bank system to
perform the services promised by it. He stood upon
firm ground on this subject. His friends could not
charge linn with change or inconsistency in this matter ;
and, as was well known, he had generally predicted,
step by step, the consequences that would follow from
the financial experiments that had afflicted the country,
beginning with that unfortunate and unnecessary mea
sure, the removal of tlie deposites in 1934. It would
be seen that he bad no strong predilection for the Stale
bank deposite system, though he admitted that it might
have done, and still could do, much better than hereto
fore, if the Executive would consent to let it alone, and
cease the continual interferences by which the banks
have been tormoiilcd, and the commerce of the country
deranged, ever since the Executive had taken the con
trol of the finances.
Mr. K. then proceeded to notice the plan of the com
mittee as proposed to be amended. This he looked
upon as a new experiment, though it had been alleged
to be otherwise by the Senator from Missouri. The
Senator insisted that wc were ahead of our destiny,
and ought lo go back to the glorious days of the Roman
empire to learn lessons on finance and political econo
my. The plan was strongly recommended as having
been that under which the Roman qti tutors made their
mild exactions from tho people. It was also recom
mended tnosl warmly by the Seuator, because it was
that under which the war levies ofNapolean were made,
and the finances of Spam and Turkey collected and dis
bursed. Upon the first recommendation, the Senator
had given us a most eloquent discourse upon Roman
heroism ; bloody battles, and the levies of the qutrs
tors. He had spoken of the great pleasure with which
he read Roman history on these subjects, aiid the de
light with which he contemplated the renown of this
great people. Well: Mr. K. said he had read some
Roman history too, though certainly not as good an his
torian as his friend from Missouri. But if any thing in
Roman history had made a strong impression upon his
republican mind, it was the heartless cruelty, the unfeel
ing rigor, aud pitiless tyranny with which exactions
were made upon the people by the Roman qutrstors ;
and unfortunately for the Senators'* Boinsti precedent,
when these exactions had been made by plundering the
Roman people and provinces to support heroism in Uic
trade of conquering and plundering tho rest of mankind,
these exactions 1 rrre deposited irith Roman bankers ap- i
pointed for the purpose.
As the Roman precedent was not found exactly satis
factory to Mr. K he proceeded to noticc the svstem so
warinlv recommended as the plan of that preat democrat
and ardent lover of liberty and free institutions, the Kin
peroT Napolcan His friend from Missouri had stated J
that when the Emperor mounted the throne of |>owor, he
found the State coffers empty, or nearly so; but in a
short time they were tilled to oveiflowiug Thereupon
the .Senator produced a book, or a document, to prove
the important fact. The tact was not doubted ; but
how were these wonders of finance accomplished ' Let
his impoverished country sud the blood and tears of
unhappy Germany answer the question. However, per
haps the financiering of this great economist was strong
ly recommended from the fact that the Isrgest sud most
timely accession to his finances wqs made by the robbery
of the bank; aud that too a bank belonging to one of the
freest and most commercial cities of Kuropo*
Mr. K. said he saw nothing 111 these Imperial prece
dents, ancient or modern, very applicable or very capti
vating, and as he saw nothing in the happy and pros
perous condition of the People of these freo and com
mercial nations, Turkey and Spam, to excite his envv,
he would rather consider this as a new and untried ex
periment, and digest it a little better before it wasadop<
* Hamburg,
t*f. Mr. K. sdd#d, that the tTste* ?U m
t ally Hie ?|*m-ic *y? .ui adopted fey lite. Exrc**e .luce
tlm ?u^WIh, ofV' ,? Wne*. Th.- postponement
would give ui a little mote lime to ol*eii? work
ings of the system, and ..certain the wiahe. ?f ,j,e ueo
pie. . ?M glad to see ,he ffiuucea ,e.loreJ lo (??.
grew, their lawful guardian, oo almost ??? u.r.?a hut
really they were in .uch a worthies .?d ragged condi
ttof, fioiu Executive. iMauiDiiUtt^mhat ? w? difficult
to say what dkpoa.iioti hail better be made of th....
the s., . *? he4?ubted wh.iU.-r he ought to detain
the Senate to ?ay any thing upon the causes of the ore
*i.t distress, which I,ad culled Congre.a together A.
thia subject had been dwelt upon, hewvvtr, by every
speaker who had preceded him, and wm certainly of
great importance to the country, it wa. perhaps the
duty of every member togivehia vie*a upon the sub
ject 1 he subject, sa.d he, la too iuqiortant to lie tri
fled with ft cornea to the doora and dwellings, and
reaches ihe bread and business, of every citizen, of every
condition; and I shall gue my views, however unwil
lingly, iiiimfltieiieed lay all |>ersoiial friendships and n.rty
associations. Unleaa we ascertain the causes which
have t?o strangely brought the country into its present
distressed condition, in a time of profound peace, we
shall neither know how to s(>ply present reinediea nor
avoid HiiiHl.tr evil* in future.
Mr K. then .aid he had not the slightest doubt that
our difficulties were owing entirely to the unfortunate
|k>Iicv snd violent measures of ihe Executive in rela
tion to the finances for sevcial years past 'Plus waa
the only cause, and this was abundantly sufficient. Mr.
h. said he could- prove this to m,y oiiu who would not
ali.it his eyes to facts, and close his understanding
against correct information on the subject. He had felt
and expressed his astonishment when he first read the
President's Message, at the statement of the President
in relation lo these causes ; and he had been equally
astonished at hearing his friends from Connecticut and
North Carolina adopt these statements, and take them
at admitted truths The President was entirely mista
ken in these statements, and to allow theiu to remain
uncorrected would only continue to obscure and mystify
the subject.
For the Utter understanding of the subject he would
read the passages alluded lo. Mr K. then lead the
passages which follow:
" However unwilling any of our citizens may hereto
fore have been to assign to these cause* the chief in
strumentality in producing the present sttte of thing*,
the developments subsequently made, and tile actual
condition, of other commercial countries, must, as it
aeems to me, dispel all lemaining doubts upon the sub
ject. It has since appeared that evils, similar to those
?tillered by. ourselves, have been experienced in Great
Britain, on the Continent, and, indeed, throughout the
commercial world ; and that in other countries, as well
as in our own, they have been uniformly preceded by
an undue enlargement of ihe boundaries of trade,
prompted, as with us, by unprecedented expansions of
the system of credit. A reference to the amount of
banking capital, and the issue of paper credits put 111
circulation in Great Britain, by banks, and in other ways
during tho years 18U4, 1835, and 1830, will show ati
augmentation of the paper currency there, as much di3
proportioned to the real wants of trade, as iu the United
States VV tih this redundancy of the paper currency,
there arose in that country also a spirit of adventurous
speculation, embracing the whole range Of human enter
prise. And was profusely given to projected improve
ments ; large investments were made m foreign stocks
and loans ; credits for goods were granted, with un
I inn L llty' 10 ",ercharU? '? foreign countries ;
I and all the means of acquiring and employing credit
were put in active operation, and extended, in their ef
fects, tp every department of business, and to every
quarter of the globe. The reaction was proportioned ill
its violence to tho extraordinary character of the events
which preceded it. Tho commercial community of
' l.reat Uriu.n were subject to the greatest difficulties,
and ttieir debtors in this country were not only sudden
Iv deprived of accustomed and expected credits, but
called upon for payments, which, in the actual inisture
of things here, could only be made through a general
pressure, and at the most ruinous sacrifices.
"In view of these facts, it would seem impossible
lor sincere inquiries after truth to resist the conviction
that the causes of the revulsion in both counir.es have
been substantially the same. Two nations, the most
commercial in the world, enjoying but recently the high
est degree of apparent prosperity, and maintaining with
each other the closest relations, are suddenly, in a time
of profound peace, and without any great national disas
ter, arrested in their career, and plunged into a state of
embarrassment and distress. In both countries we have
witnessed the same redundancy of paper money, and
other facilities of credit; tho same sp,r,t of speculation ;
the same partial success ; the same difficulties and re
verses ; and, at length, nearly the same overwhelming
catastrophe. The most material difference between
the resultM in the two countries hat only been, that, Avith
us, there has also occurred an extensive derangement
in the fiscal affairs of the Federal and Stale Govern
ments, occasioned by the suspension of specie pay
ments by the banks." ' '
Now, that over-banking, over issuing, Ac., as men
tioned by the President, have been operating causes is
only a common belief. But where did they originate
and who produced them 1 That is the first question'
And here Mr K stated that the President was mis
taken in ceery fad assumed hy him to e/mlpate our
"wn .,1 from the charge of be,,,* thr original
canst of the mix chief Other countries have been suf
fering no " evils similar to those suffered by ourselves,"
except thong which they ha vc suffered hy their connections
tr'' by u* And " a reference to the amount
0 banking capital, and the issues of paper credits, put
,.??C.o?0n i" ilreat Un,aln- &c ? during the years
1834, IS,}j, and 1836, will not " show an augmentation
of the paper currency there, as much disproportioned to
the real wants of trade as in the United States." Nor
h"s '.here bee" ?< England any general rise of prices :
nor do we witness ?? ir. both countries the same redund
ancy ol paper money, and other facilities of credit," or
'the same spirit of speculation." These positions of the
President are entirely erroneous, and the facts he sup
poses have not a shadow of existence.
He said he did not, of course, make these contradic
tions in an ollensive sense, or in a way disrespectful to
the I resident. He had been in favor of ins election,
and did not regret it. He morever believed him to bo
a man of patriotism and integrity, as well as intelligence,
and he hoped to ho able to support Ins Administration.
liut if he was (as he was doubless) a "sincere inquirer '
after truth, he would be glad to be corrected in views
calculated to deceive the people, and divert their minds
from the true agency by which they have been over
w helmed I he Presidents ? difference" in fact, ought
to have shown him where the fault lay. He states that
one nation has become bankrupt. The other sustained
itself, and is now nearly recovered. Why this " differ
ence . \\ hy, simply liecause ours is the distress of
the debtor unable to pay the debt; thkius is the dis
tress of the onkditok for want of the money due him
I he creditor of a bankrupt is frequently much injured
or want of h.s money, but it does not necessarily follow
that he also falls. And in no case is he chargeable with
the follies and extravagancies that brought about the
disaster. He may liave been too confiding, but there
his fault ends I he injudicious prodigal, with bad ad
visers, may contract debts, multiply obligations, make
experiments, and become embarrassed and bankrupt
Ihe confiding neighbor who trusted hipi too far may feel
sensibly the want of his debt, be obliged to curtail his
expenses, or otherwise economize for a white: but
being the creoiior, and therefore most likely the richer
of the two, he is not so likely to be ruined. [Here Mr.
K. read an extract of a letter from a gentleman of Liver
pool, stating that "there is no distress in England ex
ccpt that which grows out of American connections
and that is passing off, though much of the debt remain.
unpaid. ] England, we are told, from all quarters, is
now easy, and, with an abundance of capital, prepared
to make investments, and engage'm new enterprises.
1 et a mere check to the lavish accommodations of the
capitalist, by the embarrassment of his debtor is analo
gized with the utmost complacency to the prostrate and
helpless condition of his bankrupt debtor himself'
1 hose, he said, who insisted that the national distress
could not have been occasioned by the acta of our own
Executive, because there had It-en some distress m
those commercial nations with whom we trade, put him
in mind of that great philosopher, who stumped his loo
in the darkness of midnight, and railed out aga.nst the
sun for not shining in the night instead of the day al
leging as tho result of h.s most profound oh,er/ation.
that there was light enough in the day without him.
I hey confounded cause and consequence, and lost all
connection between them. It never occurred to the
philosopher that tiie sun might itself be the cause of
light, and these gentlemen cannot see our own agency
in producing this embarrassment abroad, though Uic one
agency is just about as plain as the other
Mr. K said he would try and remove the difficulty
of tho*e who felt so much embarrassment on this sub
ject, by proving?
1 That there had been no redundancy of the curren
cy in England between 1834 and 1837; but, on the
contrary, the value of money during this period had 1
greatly increased, by the increase of national wealth,
whilst currency remained alwut stationary.
2 That there had been in England no national over- ,
trading, and that her exchangca had been depreciated by
receiving our credit iu exchange for her cash and com- ,
rnoditio
f That. our ?xtru)rdiM(y44M?t epecwWisf, J
Tor the proilttcu of Enyliah latMN; lied created ao/nu ac
tivity. es|*-cia|ly to (lie meeufaluriug mlere?ta, Our
increased demand for the produce of their laU.r, coun
teracting our unnatural credit demand for thfir money
?1*0 , and, thereby, uuly maintaining price* *tucli other
wise (au far from a speculative rise) Mould havo been
depreciated by an appreciation of uione\. t
I'lieae proposition*, Mr K. aaid, Mould rather aston
ish those who had taken it for ({ranted, without inquiry,
thai by some magical fatality the whole world had been
guilty of folly similar to our own, and visited wall mini
fa r punishment. Dot if they would take leave of mere
aaaumptions, alump *|M-eche?, party presses, and vagrant
conjecture*, and be content with the plain evidence of
their senses, he thought he would maintain every pro
IKinilion, to tho satisfaction of all who would liateu to
nun.
On the first proposition, let us see whether " a re
ference to tiie amount of tanking capital, Ac in (ireat
Britain during the year* 1834, 18 1.5, and 1836, will
ahow an augmentation of paper currency there aa much
diapro|M)rtioued to the wants of trade aa in the United
State*."
Mr. K then read the following table, (p-epared from
official atatementa.)
Circulation of the Bmk of England, joint stock, and
pneate Lank*.
Bank ot Eng. Joint stock. Private. Totul.
Jan. 18311, 18,318,000 1,315,000 8,8:10,QU0 28,468,000
1834. 18.377. 000 1,258,000 8,733,001) 28,568,000
IHI'i, |H,10(I,0()0 2,188,000 8,231,000 28,51 '3,000
1830, 17,427,000 3,005,000 8,357.000 28,875,000
1837, 17,868,000 3,755,000 7,258,000 28,881,000
The foregoing table is made from the February
monthly returns of the Hank of Knglaud, and the De
cember to March quarterly returns of the joint atock
and private bauka, aa being the moat likely way lo ap
proximate to the aggregate for the month of January.
The original official return* were liefore him, Mr King
said, and were at the service bf anv gentleman ; and the
monthly and In-monthly variation in the entire circula
tion was so trifling that it was scarcely worth naming.
It would, bo seen, from the above table, that the entire
"augmentation af pa|>er currency" in England during
the years 1834, 1836, and 183d", the period mentioned
by the President, was unly ?333,000, or aliout one
third of one per cent, on the currency, estimating the
whole currency of England at ?200,000,000 ; and the
entire "augmentation" during 1833 to 183B, inclusive,
(commencing one year earlier,) was only ?412,000, or
not quite one-half of one per cent, on the whole curren
cy, and about one and a half per cent, on the paper cir
culation. Now let us see whether this increase is
"similar to our own," during the same period.
Mr. Kino then presented a statement which he be
lieved to be as accurate aa it could be made by a collec
tion and continuation of the returns of local batiks up to
1st January, 1837. It was more likely to be au under
than an overestimate, from the great difficulty of finding
new banks, and getting statements of their issues.
The following is the statement;
On the 1st of January, in tho following years, the
state of the banks was this :
Number of
Hanks.
j 1830 320
: 1834 506
i 1835 558
1836 507
1837 677
Capiital. !Loans
Dills in Depo
circu- sites,
lation |
Liabilities on
bills and de
poaites.
Million of Dollars.
145 200
200 324
231 j 365
252 458
324 591
61
05
104
140
186
56 117
76 ! 171
83 ! 187
115 I 255
155 i 341
By the above table, it will be seen that, when we add
the estimated amount of specie in 1834 and 1830, re
spectively, we find an augmentation of the entire cur
rency of nearly 94 per cent , and an augmentation of
[taper circulation of nearly 1>6 per cent. Our own entire
currericv, then, "during the years 1834, 1835, and
1836," has increased nearly 94 per cent., and our paper
j circulation, during the same period, nearly 96 per cent.,
whilst the entire currency of England has increased
ahont one-third of one per cent., and her paper circula
| tion, during that period, having fluctuated a mere trifle
at any time, and sometimes even contracted, is found, at
the end of the. period mentioned, to have increased only
i about 1 1-2 per cent. He had not given himself the
trouble to be very minute in the calculations above, and
! had used round numbers ; but no use of authentic mate
i rials could vary the result more than a mere fraction,
and strict accuracy would most likely make the compa
rison more unfavorable to the statement of an equal
expansion in the two couniries, during the period re
ferred to ?
Instead of equality, then, we had, for England, an
increase m the entire estimated currency of the uaUon
of about one-third of one per cent. ; *
In the United States, an increase of about 94 per
ccnt. ;
In England, an increase of paper currency of about
1 1-2 per cent;
In the United States, an increase of about 91 per
cent.
So much, (said Mr. King,) for an equal expansion of
the currency in both countries. As to the "other cre
dits," they were not tangible, but every man of any ob
servation must know that on this item we should suffer
in the comparison more that!in the other. Credits were
certainly multiplied in England, in some districts, by the
increase of the number of joint-stock banks, by which
now connections were formed, and the number of check*,
drafts, Jcc. increased. Hut the increase of joint-stock
banks, (deducting the private banks melted into them,)
bears no cotn|>ari*oi) to the increase of banks in this
country, as we find from ollicial statements The conse
quent increase of credits, though they cannot be ascer
tained with precision in either country, may he compared
by the result. The increase of crcdit in England has
been based on the same national cash capital, as appears
by the unclianged quantity, as exhibited by the tables.
And that it has not been redundant ur unanswerably
proven by its having protluccd no general speculative
rue of prices. To speak of a redundancy of currency
or credit, when no speculative rise in commodities has
taken place, is perfect nonsense. Where facts have
beeti stated and not proved, I have taken issue, and dis
proved them by facts fully established. Where facts
arc conjectured, I will presently introduce evidence to
prove the conjectures groundless, by proving the absence
of consequences invariably connected with them. The
only way in which a redundancy of currency or credit
depreciates foreign exchange is, by producing a specu
lative rise in prices, and a consequent overtrading. Eng
land has not overtraded ; on the contrary, sho has ex
ported more than she imported, and left us enormously
in her debt. Hut, whilst she had a large balance against
us, exchange was against her, and making a continual
drain upon her bullion! This strange financial and
commercial anomaly, so embarrassing to the English, I
will hereafter explain, after having completed the proof
on the first proposition.
He then read the evidence of Mr. Ourney, a man of
so much intelligence and authority on these subjects as
lo be called before the joint-stock bank committee lately
appointed by Parliament. This witness showa remarka
ble intelligence on the subject of finance, but is here
strangely embarrassed for want of facts, of which ho
seems entirely ignorant. [Here Mr. K. read the ovi
dcncc of Mr. Gwney as foftows .]
Evidence of Mr. Ourney before the Committee of Joint
Stock Hanks.
" Q. 2592. Has there been any change of late in the
state of the London money market!"
There has been a gradual increase in the value of
money.
V 2594 To what do you attribute that altered stale
of the money market in Ixmdon ?
One cause has been the exportation of bullion to for
eign countries; but 1 apprehend the main caisk- is,
the circulating medium existing in Europe and the mer
cantile ports if America (') is not increased in projior
Hon to the transactions, and that the same quantity of
circulating medium, or, perhaps, even a reduced quan
tity, has to perforin a much larger amount of transac
tions.
if 2595. Would not the effect of if, if owing to that
to which, you have alluded, be rather indicated iu a fall
in the money prices of commodities '
That'i* the tendency of it; but there are conflicting
causes that have marvellously maintained (not mcieas
ed) the value of commodities generally.
, Sir. Gurney is a bill broker, who procures the dis
count or rediscount of country bills in the Loudon mar
ket. He was, therefore, (veil acquainted with the facts,
and the subject on which he s|ieaks, so far as England
was concerned ; and he tells us that " the value of mo
ney had gradually increased " And in another part of
his evidence he tells us that the increase is about 20 per
ccnt. He knew this as a fact, and in England he was
enabled, in some measure, to account for it, for he
knew that currency had not increased, whilst, from the
progressive increase of national wealth, commodities
and transactions had. lie could, therefore, account for
the depreciation of exchange, and export of gold to
America, on no other supposition than that the curren
cy of tho ?'commercial parts of America" wa* even
more contracted ami diapioportioned to commodities
than in England Hut w nv was not the appreciation of
money " indicated bv a fall in the money prices of com
modities Though this was the natural " tendency,"
."-conning maiWlouelf maintained price*."
What Meiu lite conflicting cauae* referred lu by Mr
Guruaft Evidently ilia uh kimJ activity m ihe
liiaiiufMluriiif district*" by llie increased demand lor
lh? products of English Ulwr lor American consumption
7'Ac dtjnictution of cumiiimlitieM by I he apfi eciutum of
money w counteracted by an appreciation of coinmu
diliet by an i ncicattd dtmanJ Jor I hem the
ides* ?l Mr. Guruey seem clear, lie eeems, for want of
facta, to tie luvolttd ill eml<arra?auieol and apparent
contradiction. That the value of money waa raised in
England by an insufficiency in quantity, wai incoua-ln
tent .witli tli? exportation of gold, unle?? in America,
also, the currency waa contracted. And yel a con?
Iranian uj Iht ixinrury in Aim ma ipat incomnlcnl
with oufmeieuard demand fur Knglith manufaclurei.
Hud the witneja, however, known that, ao far from a
contraction, our currency had expanded near I (hi per
cent , and mat exchanges were in our favor whilst there
waa a large balance ugainat us ; that we were draining
tliein of their gold in defiance of this heavy debt and
redundant currency ; his embarrassment would have
increased, uiittl he ascertained that we were performing
all theae commercial nutaclea under a new system of
finance, by which we exchanged our credit for their
capital, and, alter going in debt for a large commercial
balance, borroiced a still greater amount, and Ihtreby
turned the exchange! against them by bin owing their
own money.
Mr. K further sustained hi* proposition, ai|d strength"
tried hia evidence upon this |>oiut by intioduciug offi
cial tables from England of.some of the principal ar
ticles of raw produce for English manufacture*, Ac.
entered for home consumption, and the official and de
clared valuation of exports ; both embracing the period
in uuestion, except the official valuation for 1837, which
he had not been able to obtain.
'Fho following are the tables produced and read by
Mr Kino:
Quantities of several principal articles of raw produce
of manufactures, <Vc., entered for home consumption
in the years ending January 6, respectively, with the
absolute and projiortional increase from 1831 to 1837.
S
n
iigs?!
? V; ' S {
?>S S" ??
t? ?
i1
? ?
_ 2 ?
? ft
a. rl
n
6.S
a v
* ?
-M*
S
3"
- s S
IE8
7S
e.
8 ^ C
S D- 5
? ft
&S.
o ^
*
g ?
C- {
?? i
sr?
2 <s
JS
2 5
f. 2?
3: ?0 I
s.f.'l
ps IV
S-3= . .f
3 *? u * ? : ?* I
3 ?
S tv
I- s wi
1: 2. jsjSf#
3
P r<- e
9i ?- C C~ ~
? is ? x
1
8 m S
g 3 * tj 5
" g |
3 *
o. - a, * "a
o s c ; '
iS'sS
'sVigi
U ill
s
-I
*??S?
T1 D
3
Uy the aliove official tables, Mr. K. said it would
clearly appear that the national wealth arid industry had
greatly increased, ? whilst the currency had remained
ibout stationary, as previously established. Mr K
I thought he had now fully established that the currency
I of England had not been equally expanded with our
! own, but on the contrary, there had been actually " a
gradual increase in the value of money."
The second proposition (Mr. K. said)scarcely needed
proof from Us close connection with the first. He
would put the matter at rest, however, by the produc
tion of evidence that ought to lie satisfactory to all. This
evidence was the perfect agreement, on this point, of
Mr. Horsley I'aliner and Mr. Knowles in their contro
versy concerning the action of the joint-stock hanko and
the conduct of the Bank of England. Mr. Palmer, in
a|K>logizing for the contraction of the Dank, and allud
ing to the causes, &c. sav* : " It is necessary to state
these, as they seetn, in no degree, to have arisen from
overtrading or any undue speculative advance m com
mercial prices." Mr Knowles, however, is not satisfi
ed with this admission, but, wishing the fact established
lieyond doubt, he asserts the same thing, and refers to
the proofs. Mr. Knowles, after proving that the legiti
mate demand for currency had been increased by the
increase of national wealth, says : " A table of prices,
had I tune to prepare one, would prove beyond question
that so far from a rise in prices generally, in many cases
there has been a fall even with decreasing stock ; a fact
quite iiicompatible with an over-iasue and depreciation
of the currency . While, again, where a rise in prices
has taken place, it is distinctly referable to causcs pros
pectively affecting the market as to supply." Some
fluctuations were doubtless exhibited in the manufactur
ing districts in particular articlos, and esftecially in arti
cles for American consumption, which, from the heavy
I increased demand for tliein, could not be readily suppli
ed by existing establishments This, however, " is dis
I tinctly referable to causes affecting the market as to
supply," and was no evidence of a redundancy of the
circulation. "The distinction might alwavsbe settled by
an observation of the following rules : That w henever
there is a great fluctuation in the value of a particular
article or commodity, whilst the value of the property of
the country generally remains unaffected, we may' take it
for granted that the fluctuation is owing to a change in
the relation between the demand and aupply. For in
stance, if there be a short crop of corn, the supply will
fall short of the demand, and the price of corn will rise,
whilst all other commodities may stand firm. This rise
is occasioned by the change in the relation between the
supply and demand. But if we find the price of every
commodity raised to an unusual elevation, (as lately in
the United States,) we may take if for granted that the
price is owing to the change in the relation between cur
rency and commodities ; in other words, that currency
or credit, or both, has been greatly increased, and con
sequently depreciated. This partial and local fluctua
tion, then, where it exiated, amounted to nothing, as it
was trifling and partial, and attributed to a fluctuation
between supply and demand?a fluctuation to be found
to some extent in all countries and at all times. Doubt
less some additional activity was occasioned by our arti
ficial and credit demand for manufactures, attended also
with au increase of manufacturing stor k. It was very
likely, also, some local ovrraction in the joint-stock
banks was occasioned by the large profits they derived
from the d.scourit of American securities and credits to
supply our credit demand for money ; for under our pre
posterous system adopted 111 1831, of importing borrow
ed money to multiply credits upon, we have been will
ing l? take all their cash as well as all their commodi
ties, and give more than any body else for them, if they
would only let us have tliein on credit. These partial
fluctuations were uncertain and unimportant, and. so far
as they didefist, if at all, arc easily accounted for, and
principally, if not entirely, lo be attributed to a connec
tion with us In no view of the subject could they lie
used as evidence of a national redundancy of currency
or credit, or of a national overtrading, neither of which,
as wo luve seen, had taken place.
To be continued.
RKMAHKM OK MR. BHONftOX,
OP NEW YORK,
In the House of Representative*, Oetoher "ith. on the
bill, to authorise the issuing of Treasury notes,?
?bW on the motion of Mr. Hell, of 'l\nnessecr to
strike out th'. enaetinp clause of the. bill
Mr Hronsox said he felt unwilling that the question
should lie taken on this motion now pending, and that
the bill should finally pass from this House without
giving his views u|>on the measures under consideration ;
and from the peculiar character which this debate bail
now assumed, and particularly since the remarks of llie
honorable gentleman from Tennessee, Mr. Bronson
satd he felt more strongly impelled to state some of the
reasons which would influence his vote, and *%hich ren
dered it clear to his mind that the bill under considera
tion should become a law. I have, said Mr. B , re
garded this measure as one peculiarly calculated to re
lieve the pecuniary distresses of the country generally,
and to lienefit the people as well as to furnish immediate
aid lo the 1'reasurv ; as one which has been viewed in
that light by nil parties in and out of this House, and
even till within the last forty-eight hours, I did not consi
der that there was any serious opposition to an issue of
Treasury notes or Government stock in some form ?
On inv journey to ihis city, I frequently heard it sug
gested ?ha.t such a measure would be eminently calcu
lated to give relief?and one which Congress should
adopt by all mean* if practicable?and what is worthy
of remark these suggestions in almost all instances
came from the opposition, from the political friends of
those who sre now opposing this bill on this floor Af
ter tny arrival here the project wa* frequently spoken of
and always with favor; in fart a sentiment decidedly
friendly to the measure prevailed here, so far as I heard
any expressum on the subject, (with one or two excep
tion*.) until aliout forty-eight hours ago, and after this lull
had been sometime under discussion, when suddenly it
seemed that new light had broken in upon this matter
Yesterday morning, Mr Speaker, wo hvard from No*
J
| York that specie had fsllen in that great commercial
mm?that Treaaury drafts ware woith a* inur.li all to
about J p? r cent us ?|H>cie?stock* rising and Hade ap
parently reviving There was also, Mr !S|?-dkfr, every
icaavn fur the public then to suppose, nut only tliat thi?
bill would paw, but that the duly bomla would lie ex
tended and further tunc given to the Deposit Banks to
pay the balances due from Ummb a* provided by the lulu
on your table. Now, Sir, it la a little angular that on
the receipt of thi* new*, and when it woiud aeem that
lielter tunes were dawning upon the country, when bu
siness appeared to be reviving, and when this and other
meaaurea recoinmcuded by the Executive, which u
might be supposed would |msi thia llouae, appeared lo
have the effect to allay excitement and reatore confi.
deuce, I uv, it la singular, air, at aueh a moment that
a inoat vigorous eflort la suddenly made to defeat thu
lull, and prevent the issue of Treasury notes, which on
all hands, so far aa I have understood, haa been viewed
BH a measure ao well calculated for the relief of the
country V\ e have lieard much, air, on the aubji ci of
the (iovermnent taking care of itself without any care
fur the people. The meaaurea recommended by the
administration have been denounced on tlu? floor a*
having a single eye to that object, and it has been made
matters of complaint here that no measures of relief for
the jxojite were pro|>oaed. This, however, has been
looked upon a* a measure calculated to relieve the peo".
|ile as well as the Government ; aa a mean ire that would
throw into circulation ten millions of dollars, wlu<u
would lie equal to so much addition to the apecie capi
tal of the country?furnishing great facilities, either as
ri mittaiices or domestic exchanges, particularly to all
classes of the commercial community. And yet, sir,
the moment there is a prospect that this measure wiil
lie adopted, and carried toe aa an administration nu i
sure, the whole opposition party arc arraigned against it ,
and unless I have entirely iniauuderstood the scojie and
tenor of this debate, their hostility to the measure, tl it
did not originate on reception of the news from New
York above alluded to. it did at least then assume a
more vigorous, obstinate and powerful ahape, so inut !i
so as to impress upon my mind most strongly the lie
lief that there was some connexion between the caiire
and effect
Did gentlemen of the opposition suppose that if tin*
lull passed jt would immediately give relief, restore con
fidence and redound to the credit of the administration '
That such will Ik* the effect to a very great extent, I
have no do%bt ; and I had hoped thai this consideration
might not be entirely overlooked by the opponents of
this bill?or if noted by them thai it would not add
zeal to their o|>posilioii. I hope it has not.
Mr. Speaker?I htt.'e listened to the debate* on
this bill, and given them all due attention; and the
various objections which have been raised in the
progress of ihis discussion against an issue of trea
sury notes, have received from me attentive const
deration.
1 was in favor of the project from the first if ih?*
slate of the treasury was such as to warrant it, and I
have heard nothing yet which to my mind is a suili
cient objection against it. Let us look for a moment
to the ground which we occupy in relation to this
niatier. and the point at which we have arrived in
this discussion.
Is it not, sir, a conceded point that the treasurv is
nearly or quite exhausted?that in a short time it
will bj necessary to raise money either by loan or
otherwise, unless the unavailable funds now in hand
can be realised ! 1 shall not here go into a review
of the financial condition of the country, or the stale
of the treasury, as exhibited by the Secretary's Re
port, orthe various explanations of that report which
nave been made on this floor. I assume the por
tion that there is no money in the treasury, or that
such will be the case very shortly?and that monev
is needed to carry on the operations of the Govern
ment. We are told so by tne Secretary ofthe Thvi
Mirv and bv Ihe Chairman of the Committee of
Ways and Means. The whole of this debate has
proceeded ii|x>n that supposition, and with the ex
ception of the honorable gentleman from Tennessee,
(Mr. Bell) and nerltaps one or two others, such has
baen allowed to n? the true state of the Treasurv by
all who have addressed the House on ihis subject ?
There can be no question that such is, the fact and
the point that is now presented is simplv, In what
manner shall we replenish the Treasurv; 1 sav
merely the Treasury, and not an exhausted or bank
rupt treasury; for, sir, we have ample resources as
soon as they can be realized without resorting to
taxes or duties. It is only necessary to resort lo
some temporary expedient to enable the Government
to go on and to furnish the Treasury with the neces
sary means, until the debts due to the Government,
and the ample, but at present unavailable means
which we have can be realised without unnecessary
distress or pressure upon the people.
By the strong vote in this House last evening on
the subject of selling the United States Bank Bonds,
it was unequivocally determined that we would n<>t
adopt that measure. We must then call upon the
deposite banks for the immediate payment of all hi
lances due from them and also npoh the merchants
for the instant payment of the duty bonds, or a result
must be had to the issue of treasury notes or Govern
ment stocks for a short time until those claims can
be realised. Can gentlemen devise any other
course ?
You have now, sir, upon your table a bill postpriit*
ing the payment of duty b.itids nine months, and an
other allowing time to the deposite banks to pav the
balances due from litem, neither of which are vet
acted ujH>n in this House, but both of which, so far
as any opinion has been elicited, meet with univer
sal favor. In fact, sir, I doubt whether there is a
member on this floor who is not prepared to support
b ith of those measures?and gentlemen opposed i
the administration and to this bill, are supposed to \< ?
particularly favorable to those. Can gentlemen <>1
the opposition then fail lo see the cffect that the de
feat of this bill must have upon those measures?an'
they sincere in desiring a delay upon the dutv bonds
and the allowance of further time to the aejxisitc
banks, and yet oppose this measure, which if defeat
ed must necessarily result in the defeat of both t lit.-c*
bills. Are they willing to assume the responsibiliiv
of denying any extension to the banks or on tin*
duty bonds, which must be Ihe inevitable consequence
of refusing to pass this bill. I apprehend, sir, that
gentlemen have not duly weighed these considera
tions, and yet it would seem impossible that they can
have overlooked the fact that by exacting immediate
pavments of the duty bonds arid bank balances, not
only the security or safety ofthe debts might he en
dangered but that increased pressure and disiress
must be felt through all the ramifications of soci
ety?and yet, sir, how can that result be avoided if
this bill is defeated]
But, sir, another and more mighty objection i.< no*
urged to this lull. After it had been debuted nearly two
days, it was suddenly discovered to be an enemy in di-J
: guise, a scheme fraught with all sorts of mischief to the
country, and danger to our institutions. In shoit, mi
incipient step tnwurits a Treasury Hank, as an enlermij
wedge towards a permanent national paper currency
The changes have been rung upon these words in all
forms and shapes, until the ear is wearv of the repeti
tion, and like the old U. S. Bank, which the gentleman
from Massachusetts insisted had become a kind of
" stalking horse" in this House. So this idea of a
"Treasury Bank." A Government paper currency lu*
become a kind of " stalking horse" to this bill, which is
led in upon tins floor by every speaker of the Opposi
tion, to frighten members out of their votes in favor of
this measure. Now, sir, I am as much opposed to a
Treasury Bank as any of the gentlemen who oppose
this bill?-and I would go as far in opposing any measure
which would be an incipient step towards such an insti
tution, or towards the establishment of an irredeemable
Government paper currency, as the most patriotic < t
them?but after a very candid examination of the sub
ject in nil its bearings, and after a careful perusal of '
bill, I cannot discover the lurking dangers with winch
other gentlemen seem to think it is fraught. I tin not
able to perceive any foundation for a Treasury Bank or
for a permanent Government paper currency lurkm?
about the bill or incident lo it. It ih, air, a verv pl.i 0.
intelligible bill, jusl what it purports to be on tile
of it, and meaning nothing more than is exprcascd?a
mere temporary expedient, to enable the Treasury, by
an isauc of Treasurv notes, to a limited amount, t<' n I*
fil ita obligations?thus anticipating the moneys due to
the Government, and at the same time to do it witl ^ t
laving any taxes or new duties The issue of Treasury
notes is confined to 10 millions, beyond which 1
no issue can be made, and to make assurance doi 1 '
sure, I will myself promise the amendment offered m
Committee of the Whole, by the gentleman from M
'rvlaml, (Mr Johnson.) limiting-the tune within which
I these notes shall be issued to the 1st of June, M'l9, "r
some other shorter time, so a* to throw sround the lull
all those safe-guards necessary to render it, ?? it i"
tended to be, and as it purports to be on the face of
a measure merely temporary. Bf the passage of ' *
lull we shall, sir, lie able lo extend all reasonable iinl ? >?
gcnce to Ihe Government debtors, at a time when it >'
not only ihe interest but the duty of the Government t"
do so we shall furnish a temporary circulation ,#h" "
may and will be used not only as a remittance W
rope, but between the different parts of the 1
which will have a tendency lo equalize exchanges, re
tain our specie from foreign eX|>ortation, restore < ouv
mcrcial confidence, and in every way relieve il.e coun
try without injury to the Government or danger t<> " ,r
I institutions. I say without danger to our institution".
| for really, sir, 1 cannot see the least shadow of foum *
' tion for the apprehension* of gentlemen on Uiat pai"