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Burlington free press. (Burlington, Vt.) 1827-1865, January 03, 1840, Image 2

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formed, run through all lite mode nrkpepinj Iip
ptiblininoapyili.it li un born hitherto in uc, and
w. iiUii.iKiii.uihy mi nRir.iv.imi ,iif.r...,V.i oi I
lIulVi III II bllilil' lIllDlljll llll! I'f 1 1 II i II I (if pteiv
todeni, Mini r.iiiiiol ilii'infnio ho nn-fnlly rrfencd
to n ,i li!l "I nil' ciiiiipir.uno fiiii'iy nl culler.
Aililitmn.il iiifnrin illun will iibo be fiinii.-linl bt
the ipiioi I nf ilie fcoiptiiiv nf lli liPii'iiiv. I" ln"
ply In ti r.i'l nude upim ili.il nflirci liv ilic lio'ie
(il ipprrncntiities nl Hip. List spmiin, ipqtui nig lie
ui'cl iiifni m.iliim mi dm oulijrcl (i I ilcf.uilla In
public, nll'ireis nr nip-pis imilrr p.uli Oflmiii i-f titioit
fmin 17S0 lo 1S37. "I'll is document will be cub
milled in von in n few tl.it . Tlie cciicr.il resnli
(hulpppnilriil nf die pnjl ollirp, which is kept pep
tiniteiy. mid will b staled by h-elf,) ?n f.ir in diet'
bear npnii '.hi? subject, me lli.it l lie lose.s which
have been, nnil urn hkelv In be, mjtaincil by .111
cI.im nf iigeiils, b ivn been ilie urealPiil by banks,
including, n riqiiliril in ilic lenjluliun, llinir !
prce.iatFil paper icccivrd fir public diie ; llint die
next Ingest limn been ht difliiusin: nfliccisj anil
Ilie least by rollce.int ami teceitcis. If die ln?e.
nn duty bunds ate included, diey alum! will be
llneelniil iliiiee In bnlli cullrclnr anil ieceiers.
Our ttlin'c experience llipipforn furnishes die
Wrongest ctiilencc dial die ilcshed legislation nl
congirfs is it lone warning 10 iiutiie in dene opera
tions die highest digicd nf reiiiily nnil facility.
Surli id.-o appears in li.it t been'llie experience
of oilier nation'. From die icults of in(piine
mule by die scciclniy of die neasitrt in i rg.u ! in
the practice unions diem, I inn enabled In Male
dial in Htenlyitto out of Itveiity seven fiiicign
gnvpi iinient?, finin winch iiniluiibipil iiifiinn ilion
Inn been ubliihieil, dm ptilihe. innnejs me kept in
cli.ti Hi of public, oliicci'. "I'll i rnncuiienie ol
npininu in fatur nl' dial h 'Ipiii i. peili.ips as great
us cxitt on any qiiejiii.n nf uilern.il ailuiiuisliaiiuii.
In Ibt' modes ol'busilioss nnil tiflicni 1
restrain' or dislm r.--i nr officers, nn legal
change was produced by t be s-uspon-lnn o'
ppocto nnynuMi'-i. Tin; report !n-t r i Tc r r r 1 1
to will lie found In enn'rnn also liincl) uo
fill information in relation to ibis suhj-ct.
I heretofore assigned to Con
gress my reasons for believing that
the establishment of an Independent
National Treasury, as contemplated
by the Constitution, is necessary to
the safe action of the Federal Gov
ernment. The suspension of spe
cie payments in 1S37, by the banks
having the custody of the public
money, showed to so alarming a de
gree our dependence on those insti
tutions for the performance of duties
required by law, that I then recom
mended the entire dissolution of
that connection. This recommen
dation has been subjected, as 1 de
sired it should be, to severe scrutiny
and animated discussion ; and I al
low myself to believe that, notwith
standing the natural diversities of
opinion which mav be anticipated on
all subjects involving such important
considerations, it has secured in its
favor as general a concurrence ol
public sentiment as could be exj ee
ted on one of such magnitude.
Recent events havo also contin
ued to develope new objections to
such a connection, beldom is any
bank under the existing system and
practice able to meet, 011 demand, ;
all its liabilities for deposites and uVfi a"'J !1 "fhuieut export of our produc-
nutus in cii dilation. It mnintnini)1 ll0,,!; " ""ct anv; necessary pa.tinl pay
, . . i menu leave Iho 11 w of credit undisturbed.
specie payments, and transacts a' al, n(1I)l,ars l() ,,e )r0f ,,,,. ( ns sm, n
profitable business, only by the con-J u. is checked by any Invitation abroad, or
lidence of the public in its solvency ; hy an inability to make payment there in
and whenever this is destroyed, the "; P'oJcioin. iheovds .f ihv ys'.n are
demands of its depositors and note-;!...
holders pressed more rapidly than J re s to pay (lie debt due, m Htuopiv Gold
it can make collections from its' and silver arc timrolore ilrnwnin cxc!ian;o
debtors force it to stop payment. 'or ll,r,r ""'c". irom ibo b-ink-s. To keep
This loss of confidence with its, UP ll,.,',r M,,,!,'' "f0"'"' ,ll,0MI ';"'""
i iont i ar ouliffcu to call ti no n tbnir own debtors,
consequences occurred in 1S37 and wno pny lh(Ml) prjricip:tiiy .r, ,lelr oWIl ,,.
afforded an apology of the banks for j which are unavailable i ihem ns they
their Suspension. The public then nre In I ho morclmnts to meet ihu InrciL'n
acquiesced in the validity of the , ciinnil. Th- cniN of ibe bank-Mburefore.
1 i ! ,i o. I I in hiicb rtn-'rijeucics, ol ni ce-'.-il V, exceed
excuse; and, while the State Legis- lol nam,;nn nrllllC0 rnrr;(I,nil,lll2
Jature, did not exact Irom them cuiiailmout of their nccninmodntions and .d
their forfeited charters, Congress ' i lie currency, at tin; very innm'tit when
in accordance with the reoom- ,hp "'f'0 "r lrfl,1,-' re''JTf-: it mi inenn
mendation of the Executive, allow- V'11'"'"' f"J hT' Tl, "",,ns,"y "'
. . .i ii 'I""' prcs-iire on Ihu cotnmnni'v is in pro
ing them time to pay over the public ( pnrlllin tl, lho prrv)(11H lt,eraiiiy ..r credn
money they held, although com- and cmrq. cut exj anmn of ihe currency
pellfcd to issue Treasury notes to forced sale. . f properly a ro inadu at Ibe
supply the deficiency thus created. ' ""'f'f Pcnasin nro mnst
if ' .cil,. nlm,.nn,.n (I. I reduced, nntl lho worst cnlamnies to in
4l l.,,1,i.aiii....i ii.t.. .u "v. Itl'vidin are only at last arn s.ed.
er motives than a want of public: opn violation of their oi.iw'an..ns
conlidence under winch the banks
seek to justify themselves in a refu- j ,,IP,r ""'i'ss f"1 nn imposition upon tin
sal to meet their obligations. , C'nmpiiy l fluctuating and d, predated
Scarcely were lho country and gov-l
eminent relieved, in a degree, from
tho difficulties occasioned by the
general suspension of 1S37, when
a partial one, occurring within
thirty months of the former, produc
ed new serious embarrassment,
though it had no palliation in such
circumstances as were alleged in
justification of that which had pre-1
viously taken place. There was j
noUiing; in the condition of the'
country to endanger a well man
aged banking institution; com
merce was deranged by no for
eign war : every branch of manu
facturing industry was crowned
witli rich rewards ; and the more
than usual abundance of our har
vests, after supplying our domes
tic wants, had left our granaries
and store houses filled with a
surplus for exportation. It is in tho
midst of this than an irrodecma
hlo and depreciated paper curren
cy is entailed upon the people by a
large portion of tho banks. They
are not driven to it by lho exhibi
tion of a loss of public confidence
or of a sudden pressure from their
depositors or noteholders, but they
excuse themselves hy alleging that
rim ftun-ent or business, and ex
change! with foreign countrieSjWhich
draws the precious metals from
their vaults, would require, in or
der to meet it, a larger curtailment
of til C II !oal1S to a Comparatively
.... Pii. . . ...
small portion oftlic communily,tln h
it will bo convenient for them th
bear, or perhaps safe for the banks
to exact. The plea has ceased to
be one of necessity. Convenience
and policy arc- now deemed suffi
cient to warrant Ihesc institutions
in disregarding their solemn obli
gations. .Suclitonduct is not mere
ly an injury toindividual creditors
but it is a wrong to the whole com
munity, from whoso libcra'ity they
hold most valuable "privileges
whose rights they violate, whoso
business they derange, and the val
ue of whose property they render
unstable and insecure. It must be
evident that this new ground for
bank suspensions, in reference their
action is not only disconnected with
but wholly Independent of the pub
lic, gives a character to their sus
pensions more alarming than any
which they exhibited before, and
greatly increases the impropriety of
relying on the banks in the transac
tions of the Government.
A 'a'fje nntl highly ropcclnbto por.
tinn of our banking "in'titinious tire, n
nfi'irdj mo unfeigned pleasure to Plate,
exempted from all b aniu an account ol
i Ins second delinquency. They hove, to
their great credit, not only coirirned to
meet their rnirngrmcnU, lint have even
repudiated the grounds of -inpcnHun now
reported to. It in only by such a course
that 1 1) o confidence and good will of the
community can he preserved, and, in Hie
srquel, the best interests of the institu
lions ihemselves promoted.
New dangers to the banks arc also daily
di?closed from I lie extension ol that t-ys'.ein
of extrnvagraiii credit of which they nie
the pillar.". Formerly our loreiirn com
iiictce was principally founded on nn ex
change of commodities, incliid ng 'be pre
cious metals, and leaving in its transactions
but little foreign debt. Such is not now
Ilia rase Aldrd bv the- (neililins nficirrVii
by Hie bank', mere'credil has become loo
cimimunlv Hie Imsio nf tr.wle. Mnnv nf
the banks themselves, not content 'will.
largely stimulating this nystem mining
others, have nsurf.ed the business, while
they impair the stability, of the inecauiile
community ; they have become borrowers
instead ol lenders; they establish their
agencies abroad ; they encourage the is-ue
ol Suite securities until lho foreign market
is glutted with them ; and, unsnti-fii'd with
the legitimate use of their oun capital and
the exercise of their lawful privileges, they
raise, hy large loans, additional menus for
every variety of speculation. Tlie disasters
attendant on this deviation from lho former
course of business in Ibis country, ate now
slnred ahke by Initio and individuals, to
nn extent, of which there is perhaps no pre
vious example in the annals of our count ry
St Ion;; ns a willingness nf the foreign Ion
the bank.s, a reiuMil
to pn v fiP' eio lor
Tlip,0 c,)n(!rn,.cl,cn.
an inherent in
the preseni sysieui. They arc not inlli-
cneeilbyihe banks being large or sinull
created hy National or hta'o (jovcrnments
l liey are tho results ol tho irresistible
laws of I rade and crot'it. In the recent
cvnis which have so strikingly illustrated
'he certain etlucts o( these laws, wu huva
n'.'ti the built of the largest capital in lho
Union, e-iublished under a National char-
oulborafve'y informed, by exchanging
tlu.t for a S atu charter, with new and
unusual privileges in a condition too, as
l was smu, ol entire soundness ami great
prosperiiynnt merely utiablo to resist
these effecls, but Ibo first to yield to them.
Nor is it to be overlooked that there ex
iatD acbain of necessary dependence among
these inatitutions which obliges them, to n
gieai extent, to follow the course of.othnrs
not withstanding its injustice to their own
unniediaio creditors, or injury to Ihu par.
licular community in which thev arc
placed. This dependence, nf a batik, which
is in proportion to tho extent of us debts
for circulation and deposites, is not mere
ly on oihers in its own vicinity, but on all
Ihnsij which connect it wild lho cenlro of
Undo. Distant banks may fail without
seriously affecting those in our principal
cnuiiucrcial cities, but the lailoro of the
latter is felt at the extremities of tho union
Tho suspension ut New York, in 1 037
was every where, with very few ex
ceptions. followed as soon as it was known;
that recenily at Phi'ndulphia immediately
aflee'ed the hanks of tho south ami west
in a similar manner. This dependence !
our whole hanking sys'ein on ihe institu
tions in a few very largo citieH, is not
found in the laws of (heir organization, hut
in thoFO of trade and exchange. T(he
banks nt that centre to which currency
flows, ond where it ia '(quired in payment'
for tnerchninbze, hold ilia power of tun
trolling thosT! in togioiis whenci! it comps,
while the latter pn ses no iiientH nf fc"
slriiining theui! po that th value of intlitjd
ual properly and the prn.penty oftrnie,
ihrough tlie whole interior of the cqin
try, nre mnijn lodipend on lho cpm
or bad iinnngriuetit n( ilm Innking itMi
tntions tn the great heals oftrado and on
the seaboard.
13iil lh'n chain of dependence doe- nnl
ntnp here, ll does not terminate at I'lni
ailelphia or Now York. It reaches across
the ocean and ctul.s in London, the centre
of 1 1i c credit system, Tho Fame lawi ol
I ratio which gtvo to tho batiks in ntir
principal cities power over the whole bank
ing vtcm of the United S'atc-, Euhject
i no tonner, in their turn, to Hie nmney
power in Great Dntaiti. Tt is not tlenied
llnii lho fti'penston tifthc Now York banks
in 1037. which was followed in quick fuc
cesMon throughout lho Union, was pin
duced by an application of that power;
and it is now alleged, in cjtoinntion of
the present condition of so lirgo a por
lion of our banks, that thef cmbirrass.
nietits have arisen from the tamo caiifc.
Prom this influence they cannot new
entirely epcape. fur it has iH origin in I ic
credit currencies of lho tw countries, il
is strengthened by the ctrront. of trade
and exchange, which crnt'is in London, fc
is rendered nlmosi irrcHstp'o by tho larpe
('cb's contracted there by our merchants
our Viniik and our elates,' It is thus'tbal
nn intrnilnc'inti of n new , batik into the
most di-lart nf our villa'cs, placrs the
businci-'s of that village w n'nii the ii.fliirnco
of the money power in England. It h thus
that every new debt which wo contract in
thai conntrv, seriously nTects our own
currency, and extends ovtr tho pursuits
of our iiizens its powerful influence. Vc
cannot c-capo from t Ins by making new
banks, real or stna'l, state or national
I ho sane clnitw winch hind those now
exist ing to tho centre of this system of pa
per creiii. tnot equally letter every sim
ilar inslnitioti we create. It is only by
th-1 exteit to which tl is system has been
pmhei) o? h'e, bat wc have been niad
ful'y awa-o of its irre.silahli! tendency to
subject or own banks and currency t
a vast coil rolling power in a foreign land
anil it mid a new a'gument to those winch
l.ll,,-,rn"3, Pfcnnnii Hit uat innj En
uafigerpu ii, Ilic tirst place tiy ineir own
' mifmanagedpnt. and again by the conduct
j '".every institution which connects them
wen iiii! eeprn "i irnue ii our own cniltl
t ry. t bev ari tubjec'eii, beyond all this
to the cited 1 1 whatever measures policy
necessity, of caprice, may induce those
who cut rol he credits of England to resort
to. I incao not to eminent upon these
measures, (indent or pa-', and much less
to discourage hc prosecution of fair com
mercial ilealutt between tho two coun'ries
b'iseij on recipweal benefi's . but it liav
ing now been nvule manifest that tho poty.
er of mil cttng these and simihr injuries,
is, by i It o resi-lle-s 'aw ofcredit currency
and credit trade, equally capable utixiond
ing l heir consilience through all the
ramification of nor banking sys'eio, and
bv that means jml rectly ub'nii ing, particu
larly when our linnk- aie u-etl as deposi
tories of the pnb'ic innnovs, n dnnjrernus
(P. loir.il ii. ilornc' io Hir Uoi'ed Kiiilej, I
have denned il u y (liny lo bring the sob
j cl to your nn ice, and a:-k for it your te
nons cniisiileialtdii.
. Is an argument required beyond the ex
po-ilion ol'lliesc facts, to -how lho impro
priety of ii-ing nur banking institutions
depositories of th0 public money . 5 Unit
we venture tut only to encounter the
ri-k of their ird vidual and mutual inir.
management, bit. nt the saino Mine. to phire
our igreign nut domestic policy entirely
under Hie contiol of n foreign moneyed in
terest ? To d o i to impair the mile,
petidence of oir g. vernillrnl, ns the pre--ent
credit sysem has already impaind
i hn indepenc" nir banks. Ft is to mbum
all iU itiiporatit eperntions, whether
of pence or war. in ho controlled or
ihwatli'd at fist by our hunks, ami then
by a power nbnad greater than themselves
I cannot Ining nysell to dep el the huiml
iat inn n winch t bis government and pro
pie might In" sinner or later reduced, if
t he means for defending their rights are
to be undo depndenl upon those who may
havo the most powerful of motives to im
pair then.
Nor is it oily in reference lo tho effect
this stain of thugs on the independence of
our govrrnmeit or of on r batiks, that, the
oibject n'occiti iise f for consideration ;
it is to hr vie veil also in its relation? to
ihegeoeril frado of nor cuiuiry. The
Mine is n n 'o'g past when deficienc) ol
foreign cripswas thought to afford a nro
fiinbto ma ke for thu surplus of our indus
try ; but imwwo wan wilh feveiisli nnn1
leiy the newiof the Rogli-li harvest, not
so much fruT motives ot cnuimennhlc sym
pathy, but leirful lest its anticipated fail
ure should nrrotvjthe fild ofcredit there
Ones not tlj.spenk volumes to the pat1
not .' Can i sy-teui bo beoificent, wise
or just, wlnti creates greater anxiety for
uiiere-its de nileiit on foreign credit. than
for the giiujal profperity of our own coun
try ami ino jrotitatno exportation ot tlie
surplus, prodico of our labor ?
The circinisiances to which I have
thus ndvertjil, appear lo nio to iifTord
weiglny red oes, developed by late eveuti
to be added 'o those which I have on for
mer nccnstois ofil-red, when suhmiittiiig
to your bolter knowl-Mlgo and diFcerntneut
lho propriety of separating too custody of
the public money from hanking institutions
Nor lias any thing occurred to lessen,
my ( pinion, ihe only ground on which that
custody can bo desired by ihe banks, is
the profitable uso which they may make
of the money, hocli uo would ho 'egar
dud in individuals as n breach of trim, or a
crime of great magnitude, and yet it may
he rcaeuuauly doubled whether, fir-t and
last il n not attended with more mischiev
ous consequences, when permitted to the
former than to thu latter. Tho nrnci ic
of permitting the public money in ho tisr-il
hy Us keepers as horo is boliived to ho
puculiar lo this country. and to exist scarce
ly any where else. I o procure it here.
improper nitluences nro appealed to; tin
wise ccniiection9 aro established between
tlie gorernment and van numbers of now
crful statu institutions, ; other motives than
I Ii o public good nro bolli brought lo bear
uoin on i no executive, and Legislative do
par1 incut, und ecIHsIi combina'tionf, lend.
ing to ppeciol legislation, are formed. It
is made lho interest nf banking institutions
and their stockholders throughout the
Union lo u f o their exertions for tho in
crease nf taxation and the nncumu'nlioii ol
a surnlus revenue ; and while an excuse
is nflitdeil, ihu means aro luinii-hed lor
those excessive issue, which lead to ex
irnvagant trading and sper.ulatinii, m'd nre
I be forerunners ofn vnst debt abroad nntl a
suspension of the banks at home.
Impressed, therefore, as I am, with the
propriety ol the funds of tho Government
being withdrawn from the private use of
cither hanks or individual, mid ll o public
money kept by duly appointed agents; and
believing, as I do, that such also is the
judgment which discission, reflection, and
xpenence have produced on the public
mind, I leave Ihe subject with you. It is.
at all events, essential lo Ihe interests ol
the cotniiiiinily and the business of the
government, that a decision should be
Most of tho arguments that di'suade us
from employing banks, in the cnslody and
disbursement of the public money, apply
witli equal lorcc lo the receipt of their
notes for public dues. The difference is
only in form. In ono instance, tho gov
ernment is creditor for its deposites, and
in lho othar, lor the notes it hold. They
afl'ord the same opportunity for using the
public moneys, ond equally lead to all the
evils nllcndont upon tt, sinco a bank can
as safely extend He discounts on a depoil
of its note in I he hands of a public officer,
as on one made in it b own vaults. On i lie
other hand, it would g ve to tho govern,
met t no grenicr security, for. in case of
failure'-, the claim of ihe note holder would
be no better than that ofn depositor.
I urn aware thai the danger of inconve
nience to the public, and unreasonable
pressure upon sound banks, have been urg.
ed ns objections to rcqnring the payment
of ilic revenue in rold and silver. These
object ioas havo been greatly exaggerated.
From the best estimate, we may safely lix
the amount of specie in the country nt
eighty five mi'lions of dollars and the por
tion of that which wou'd be employed al
any tunc in ihe receipts and di.-biirscmen!-of
t he government, even if tho proposed
change were made at once, would not, it
is now, after fuller investigation, believed,
exceed four or five millions. Ifthe change
wore gradual, several years would elap-c
before thut sum would bo required, with
annual opportunities, in the mean time, to
alter the law, should experience prove it to
be oppressu-e or inconvenient. The por.
lions of ihe comtnui ity on whose business
the change would 'iimediate'y opmte, are
comparatively small, imr is il belli ved that
lis i (T' ds would be in the Icatt unjut or
injurious to I lieio,
In ibe payment nf duties, which con
stitute by far lho greaier portion of the
revenue, a very large proportion is derived
fn m foreign cotntnisHoo houses and agents
of foreign manufacturers, who sell the
goods consigned to them, generally ot
auction, and after paying the duties
out of the avails, remit the nsi abroad
in specie or its equivalent. That the
amount ol duties should in such cises, be
retained in specie, can hardly be made n
mailer nf complaint. Our own importing
ui-toIi'mi', ly wlpoo the r. .--.I c nl tl,-
do'ies is paid, ate not only peculiarly m
leres'cd in inuioiaitnng a round currency,
which Ihe measure in question will espu
cially promote but are. from Ihe nature ol
their dealings, best able lo know vhen
specie will be needed, anil to prncu-e it
Willi the least difficulty or sacrifice. Ite.-i.
ding, too, almo-t universally in plase
where ihe revenue is received,' and where
the draf's used by the government tor
tho disbursements must concent ra'e;
i bey have every opportunity lo obtain inI
u-e i hem in place of specie, should ii h
for their intern-i or convenience. Of th
number of i hese d rails', nnil ihu facilities!
they may afi'rd as t ell as of the rapidity
with winch the public hinds are drawn and
hor-ed. an idea may be drawn from the
luct thai ol nearly twenty millions of dol
lars paid lo collectors and receivers during
the present year, the average amount hi
thotr hands at any one lime, has not ex.
cei ded a million and a halt"; and of Ihu fit'.
eon millions received by the collector of
New York alone during Ihe present year,
the nverage amount held by bin subject
to draft during each week, have been less
t ban half a million.
Tho ease and ol'eiy nf the operations of
the treasury, in keeping ihe public money,
ere promoted by the application of its own
draf's to liie public dues. Tho object ion
arming from having them too long out,
standing, might he obviated, and thev
made to nfl'ird the merchanls and banks
holding Ihem, an equivalent for specie, and
in mat way greatly lessen the amount ac
tually required, Still less inconvenience
will attend tho requirement of suede in
purchases of public lands. Such purchas
es, except when made on speculation, ore
in general, but single transactions, rarely
repealed by the some person; and it is o
fart, that for tho last year and a half, du
ring which the notes of sound banks have
been rfccived, more than a moiety of these
payments has boenv voluntarily made in
specie, being ;i larger proportion than
would have been required in ihreo years
under th'j graduation proposed.
It is nnreover n principle thnn which
none is buter setllec by experience, that
thuHippI) of the precious metals will al
ways bo hund ndrquaio lo tho uses for
which thej aro required. They abound
in countries whore no other currency i
allowed. In our own slates where small
notes aro excluded, gold and silver supply
their place, When driven lo their hiding
places by ba.ic suspensions, n littlo firmnesf
in the community soon restores them in
sufficient qtni-itity for ordinary purposes,
I'oslago and uilier public does hnve btv-n
collected in cim without serious incoiire
iiteuce, even in suites where a deprecirird
paper currency has existed fur years, mid
this, wuii die aid of treasury noies ttr a
part of tho lime, was d ino without liter, i
rnption during tho suspension of llfl7.
Al tho present moment, the receipts and
disbursements of the gnvorninrnt ar mado
in legal currency in the largest portion of
tho Union no one suggests a departure
from this rule; and if il can now oe sue.
ccssfully corned out, il will bo su oly nf
tended with even less difficulty wlnn bank
miles are again redeemed in fpeeio.
Indeed I cannot think that a Kiious ob
jection would aiy where bo rnicd tniho
receipt and payment ol gold ami silvc in
all public transactions, worn il tint fn- nn
apprehension that n surp'tw in tho treitoi
ry might withdraw a largo portion if it
from circulation, and I' ck It up ntipn.fpa
hly io Ihe publ'C vaults. It would in.i, in
iooooi i ' "' :
authentic statements which I hav tiltonlv
subtinlletl to you in regard lo Hie acliial
amount in the treasury at any one lime
during the perino embraced "n them, and
tho litilc probability of n different siato ol
the Trc.i'tify for at least some ycats to
come, seem lo render It unnecessary to
dwell upon it. Congress tnnreover, as I
have before observed, will in every year
have an opportunity to guard ngiinst it,
should the occurrence of any circutnMnnco
lead us to apprehend injury from this
source. Viewing the subject in nil il as
pects, I cannot believe Hint any perioo
will be more auspicious than the prc-er.t
lor lho adoption of nil measures necessary
lo maintain the sanctity ot our own en
gagenieiits, and lo aid in securing to tne di-asler. and bind every banl- more effec'u
coiiimunity that abundant pupp y of the j ally, in the first instance, to those of our
precious metals which adds so much to cummercial cities, and, in lho end, to a
tueir prosperity, ono g'ves sucn incriasuu ,
stability to all their dealin
Fn a country so commercial as nus,
banks io some form will probably nlveys
exist ; but this serves only to render t Hie
more incumbent on u, not withholding
lho (liseniirairom'-nts of I he past, -i "rit"
io our respective stations to indirafe the
evils they prnduce: in take from ln.i ts
rapidly as . the n'lhga'inns of public fnilh
and a careful con-iderotinn of tiic imnndi
ate inicrests of the commuoity will petittf,
tho unjust character of motnpnlies : In
check so far as may be practicajlo by pni
dcoi legislation, those teiiipiaton of n
terest and thoe oppnriuuilies fur thiir
dangerous indulgence which beset ihem m
every side, and io confine thcin strictly o
the performance of i heir paramount dtiV.
thai of aiding the operations ol cotinnerr-.
rather than consulting their own exclii'i p
advantage. These and any other saUnay)
reforms may. it i? h.'hevi'd, bo accemphs.
ed wiihniit the violaiion nf any of the gre I
principles of Micia I compact, t he ob-ervatn
of which is indispen'ahlo to Us ex's'enc,
or interfering in any way with the useM
and prnfiiablo employment of real capi'a,
Institution? so framed have c.vstcd ant
still exi-t elsr where, giving to cemmerci:l
inif rcnursc all necessary facilities, withoti
inflating or depreciating lho currency o
stimulating specula! inn. Thus accomplish
ing their legiiiniaie ends, they have game,
the surest guarantee lor their prutec'iot
and encouragement in tho good will of tlx
community. Among a people so just n
our--, the same tcsnlts cnu'd tint fail (n at'
'cud a slindnr course. The direct supervis
too of the banks, belongs, frnm the naiun
of our government, io the -lates who au
thorns- them. It is lo iheir lrgiflaiure
that the people must mainly look fur action
on that subject. But as "ihe cnndncl ol
the Federal government in 'ho manage
mant of its revenue has also a powerful,
though less immediate influence upon tin in
it becomes our duly to see that a p-oper
direction is g v.-n lo it. While the keep
log of the public revenue in a separate and
i.l.-r,...U,..t -.-...j. ... .l.r:
ol it m gold ti ml si'ver, will hive a -nliiia
ry influence on the sy-tpm of paper o'edit
with winch nil banks are connected, and
ihns aid those that are sound and n-ell
managed, it will at iho same lone sen-ibly
check thn-e vt Inch aro otherwise, hv at
once withholding t li means of exttnvi
gance nflorded by the public fun-Is. uul
restraining them fVnm excess. vu issues of
notes winch they would hi.- cnns'ant'v cal.
led upon to redeem.
I am aware that it has heeu urged ihu
this con'rol may hi- hoi nitained and r
erteil by means of a National ISnik. The
e.onsiuuiional olij.-ctions wlrcli I nio well
known in eoteriii'ii, would prevent m ii
any event from prnpn-mg l)r as-enhng ii
that remedy; but in addition lo this. ran
not, after p-ift experience, hnng my-cU' to
lint it cat. any longer h- exten-ively
reganleii as ill cHvo ir such n iiuroo.o.
tor such a niiron-e.
Pne hi-inry of i he late Nal ional Bank Mi'o
II its inutnlioos -hows thai it was not fn.
On lho cinlriiiy.it may. alter a careinl
citisideratinn ol th,. subject, be, I dunk
stfely slated thin at every period of Ban
kng exce- it took 'he lend, that in I"I7
nul lfllf;, in I J.I tii 1 03 1 . ,ind io lfl.31.
Us vat expansion., follmveil by di-lrcstuig
coitrnciions, led in thnso of ilm S'nio nt
stiMiions. Il stti iud nnd ninldenrd the
lid s of lho bank ng syslem. bill seld-m
nllineil or safely directed t hem. At n IV
perixls only was a salu'ary control e.v-r
ci-ci. but on eager desire, nn Ihe contrary
exhdited for profit in the firs' place; uml
if, altjt ward--, its measures wire severe to
wardroiher iiisiiln'ioiis, it wrs because r
own sifetv rompelled n to adept Ihem. It
diil-iio d'fiVr froiii t hem in principle or in
form; its measures emaiiotid frnm Ilie
same mri' of gain; it fell i lioinnio temp
lotion 'j 'iver-i-nit-H ; it sufieMil frnm, ami
wns loit'lv unable lo nvert tlnso inet tnlile
latvenfl-ade by which it was s'sclf oflecled
equallytiitli litem: and at lea-t on ono oc
casion, otnn early day. it was saved rnly
by extrao'dinary exertions friin i ho Fume
falo that blended lho wcaked iosiiiniion
it professed to supervise, ln 1037 it failed
equally wi'.h others, in redeetiiog its no'es,
ilifugh the two years allowed by Us char
le for I li n purpose h-n1 a ojtpired, a large
amount nf which remains to tho present
tune outttuiding
It is tine, that having so vast a copilo
nnd strengthened by thu use uf ail lho ru
venues of tho Govcrninent, it possessed
more power; nut tvlnlo it was itself, by
that circti'nisiance, (reed Irom tho control
which nil banks require, its paramount ob
ject and inducement worn left lho same--
to mako the most for iis stockholders, mil
to tegiihiie ihe currency nt lho cuuntrv,
Nor has it as far as wo aro advised, hei'i -
found lo be greatly otherwise flu-whore.
Tho ninionnl character given to tho bank uf
tins iii.t prevented excessive flucluotions
in llieir curreney, nnd it proved tinublo In
keep ofl'a snspeiision of speciu payinents,
which lasted fur nearly a quarter of a cen
tury. And why should wo expect il to bn
otherwise? A notioan weliiutipn. though
deriving its charier from n different source
l han lho stain banks, is yet constil.i.eil
upon tho fame principles ; is conducted by
men equally ajposed to triulaiion ; ami is
liable to Iho enmo disaHers; wi"' ",0 ou'
li"onr, tlisadvantngrj that itn magnilndo
'ccasmnt an extent of confuVmn and dii
,p?4' which tho misminagtmerit of smaller
'""'"I'lntis could not produce. It can
scarcely In doubted that, the recent pus
n'Mittori of ihe United States Flank of
l'nniiai.1.. . n ... .
-oi- iitnnn .,, ,
hnsiri I'
ortgia in a course of
I -" " -vniifj wjn u IIUIIOII-
"1 mhi in ion s nn, t here is no m,d rcnon
r M.ppu.uig ,! famQ conFPqlJpncc(,
(Oll.liinn,...,! I.. :. .
" ""iiowpi . m( it nil Mi orivnil
powers from tW r,nn,a (:.,.,
1 1 is
vain, when the influence, anil im-
, ' ,nrV"c '"look for a difference?
..conductor results Uy PUc, creation9
wo do therefore but inctcns,. tho mas of
piper credit and paper duncy. without
cheeking their attendant evil 8d fiuctua
linn. The extent of power anj the effil
ciency oforganizition which we nive,so far
mini uemg oeneiictoi, are in practice posi-
tjvnly injurious. They strengthen th?
, iiinuuiieiiuu inrougoiii uie union,
Slllliect all narts morn eerlnmlw to nnmmnn.
lore.gn power. In a word, I caonot but
believe that, with the full understanding of
lho onerotioos of nur hanking system which
experience has prduced, public sentiment iff
not less opposed to the creation of a Na
tional FJank for purposes connected with
eurrency and commerc, than for those
connected with the fiscal operations ot ihu
Yet t)io commerce ond currency of iho
country arc suffering evils frnm the opera
tions of the state banks which can not ami
ought not to be overlooked. By their
means, wo have been flooded wilh a de
preciated papr, which it was evidently
iho design of the fratners of tho consiitu
turn to prevent, when they required con
gross to "com money and regnlatu tho
valnn of foreign coins," aod when they
forbade the sintes "to coin money, emit
bills of credit, make any thing but gold and
si'ver a lender in payment of debis," or
"pass any law unpiring the obligation nf
contract." If they did not guard tnnro
explicitly against the prrsenl state of thing-
it was because thry Gonld not have nnttct.
pated that lho few hanks then cxisiine-
were to swell lo an c.Vent which would
expel to so grool a degree I he gold nod
liver, for which I hey had provided, from
the channels nl circulation, and fill ihem
with a currency that defeats tho object
thev had in view.
I'ho reoidy for this must chn fly rest
with the S'alcs from wdio'e legistatinn it
has sp'iiog. No good ihat might accrue
a particular ci-e from t he exercise of
powrr--. not obvtoii-ly conferred on lho
neral (loverii'iioni , would au'horize tin
interference, or j n ify a cour.-e that might
in the shghte-t degree, inereas" at Ihe ex
pense of t he S a.es, t lie power of the Federol
authorities nor do I doubt that the Slates-
will apply the remedy. Wuhin lho lat
few years events have appealed to them
loo strongly to ho disregarded. They
have een that Iho Cnnsiiiulion, though
theoretically adhered lo. is subvi rted in,
practice: that while on I lie statute books
there is no legal 'ender hut gold and silver,
no low imnnjeing lln- ob'g-itlons of con
tracts, yet titjiii point of lac), Ihe privi.
'egos conl-rreWhu hanking corporations
hnve made their notes the currency of iho
country ; that the oblignlioiis imposed by
ihe-e note., are violated under I he-impul-esj
of interest or cnnvoriience ; nod that Iho
number nnil pint or of I he persons connect
ed with the-e corporations or placed under
ihe:r influence, give iIhmii a fearful weight
when their inlero-t is in opposition to'lho
spirit of the con-li'inion and laws. 'p
the people it is nuiKileriril whether these
re-u'ts!iri produced by open violations of
ti e I liter, or hy the workings ofn y.si. in of
ivli-ch 'he re. n't is ihe .ain. An" lofl-xi-ble
exeetii ion even of Ihe existing statutes!
ofino-t of lb Slates, would redress many
i vi's now enduri i! ; tvou'd rff ctua'ly shnw
In-Innks the danger of ini-manai'ement
1 ; '. ' ;y , "i,r""t'? Mr,n 'P';
, ' .. ti-i.ni
-on i on I inev are Ilie -nil -els o tlw,
law a ml Hie ervante of the people. Wliof
is si winning in i (T. rl the-e nhieels imui
lie sought in nddiltonnl legislation; or, it
lint In- inadi quale, in such further cruisli
I'lt'oml grants or restrictions as may bring
us back into ilie path from which we have
so widely wandered.
In Ihe meantime, it is the duty of the
General (Jovernmont to co-operate with
the Slnles. hy n wi-n exercise of its coosli.
luminal powers nnd the enforcement of it
existing laws, Tho extent to which it may
do so by further eoac'meois, I have already
adverted in. and the wisdom of Coogres's
may jet enlarge thorn. But, above oil, it
is incumbent upon us m hold ereel lho
principles nf morality and law. cmistnntly
executing our own cmiiracis in nccordancn
with the provisions of ihe Constitution, nnd
thus serving as a rallying point by which
""r whole country nnv ho brought back to
uni soieanu nonoreu sinnuard.
Our people will not ho long insensibl
to die extent of the bnrdpns entailed upon
thm hy the false system that has been
operating on their sanguine energetic, mid
iiiilustfi us character ; nor to Iho means
iirce-s i'v to extricate themselves from
these cuibnrrasmcnts. Tlie weight which
presses upon a large portion of the Pcoplo
and the States, is an enormous debt, for,
cign nnd domestic. The foreign debt of.
our States corporations, nnd men of husi.
iien. con scarcely be less l lion '.'00 OUO.
("00 of dollars, requiring more than ten
millions u year 10 pij inu miti"'
sum has to bo paid nut of tho expnrU of
country, nnd mul of necessity cut ofl im
ports to dint rxteoi. or plunge ine cuuuirv
' umre deeply in debt frnm yenr to year. It
j t" eay to co dial mo iucrn.su t n.
1 foreign ilebt must nugmcnl lho annual tic
j mmi'l "u Ibe exports to p-iy the inreret.
nd to Iho same extoiil dimmih Ibo "-
pirts; nnd in proportion lo lho enlarge
ment nf the loreign tli-lit. anu ino :
queiit ii'creao ol interest must bo the de
crease of the import of trado
In lieu of the comforts which it now
brings us, wo might hove nor RiRantie
bunking institutions, nnd splei"'1"' "ul "J
'"any mstonens profitless, railroads and
caniiltt, iibsorhin" to a jrcat extent, in
'"Icrem upon ihe"capiial borrowed to con
sUuci them, iho surplus fruits of national
industry or years to come, nd eccuring

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