Maumee City express. [volume], December 14, 1839, Image 1

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"V
BY REED Ic HOSMER.
GOVEUNOR'S MESSAGE.
Gentlemen of the Senate,
and of the Haute of Jlepretenlativet.
.In meeting together for the purpose of
iiicnarging uie mgu ana responsible duties
of the trust reposed in us by our constitu
ents, we are naturally led, in the first place,
to the consideration of those subjects which
recalculated to make a pleasing impres
ion on our minds, and inspire us with grate
ful feeling to a kind and benificent Provi
dence to wnorn we are indebted lor the nu
merous blessings which we enjoy. With
but few exceptions the health of the State
kaa been unusually good during the past
eason; erder, tranquility and peace have
perailed within nur borders; and the diffi-
cutties which, to some extent, threatened
the repose of our northern frontier, grow-
' tng out of the late disturbances in Canada,
have disappeared . A strict observance of
; the law, and a high regard for their faith
ful execution, have eminently characterized
me great oooy or our citizens; ana the toll
nd industry of the husbandman has been
rewarded with an abundant crop of all the
productions usual to our fertile soil and ge
nial climate. '
The surplus produce of the stalest is be
lieved, will be much greater this year, than
any former season since the settlement of
the country; and will yield, even it it Bhould
be sold at the present reduced prices, an
aggregate amount of value equal o that of
any former year. This will sustain our ag
ricultural interest in its usual prosperous
and flourishing condition, upon which,
mainly depend all the other great and lead
ing interests of the state. Our climate,
oil, and geographical position, designated
us as an agricultural people, and upon this
branch of industry must we principally de
pend for ali our wealth and resources. It
is from a soil of unsurpassed fertility and
great agricultural capabilities that we must,
sooner or later, draw the necessary means
of paying our debts and sustaining the cre
dit of the state' It is true,, that a great
portion of our state is well adapted to the
business of manufacturing, and offers facili
ties and inducements for this branch of in
dustry, which will not always be overlook
ed by enterprising capitalists. The inex
haustible beds of coal and iron ore found in
many parts of the state, the extensive wa
ter power furnished by- our numerous
streams, and created by our various pubiic
works, hold out strong inducements for the
investment of capital in this state, in man
ufacturing operations. But it is not in the
infancy of a country that We see manufac
turing establishments springing into exist
ence, and rivaling agriculture in the crea
tion or actual weaun monuiaciures are al
ways of alow growth, and rarely arrive to
much importance, until the labor of a coun
try becomes greater than the demands of
agriculture require. We must, therefore,
look to agriculture for the present, and for
y some time to come, as the great leading in
i terests ot the state from which our principal
wealth and resources must be derived, and
which iaespecially entitled to the fostering
care of the Legislature.
Education, and moral and intellectual
improvement among our citizens, are stea
dily and rapidly advancing under sur liberal
system of instruction. That general intel- j
ligence which is, and must ever continue
t be, the great bulwark of our republican
institutions, and is the result, in a great de
gree, of our liberal system of education, and
the inquiring spirit of the age is rapidly in
creasing throughout the whole country. It
is a duty which we owe to ourselveses well
ma to posterity, to adopt all the necessary
means, Which prudence may suggest and
wisdom devise, to preserve and perpetuate
our free institutions. From the history of
the part we may learn something of the fu
ture; and it is a fact worthy to be remarked,
that no people hitherto havo long been
able to preserve their freedom, when the
mass of the community wcro uneducated
and uninformed. The great and unprece
dented success which has marked our
iree institutions, snd the wisdom and
prudenoe which has generally characterized
the administration ot our public affairs, are
mainly to be attributed to the force of en
. lightened public opinion, emanating from an
Intelligent and well educated community,
t If we expect to avoid the fate of the repub-
lies in time past, and preserved our free in
j stitutions from the inroads of despotism,
! and the selfish ambition of the designing
few, we must foster and cherish the means
of general instruction. An enlightened
system of education by which the rising
youth in each succeeding generation will be
prepared and qualified to act the part as
signed them by tho theory and fundamen
tal principles of our government, as they
take their position on the stage of human ac
tion, is the strongest barrier that can be
presented against anti-republican princi
ples. We may, withconfidence, anticipate
that so long as we maintain a liberal, enligh
tened, aid general system of instructrion
in our state, our free institutions will
be maintained, liberty and a love of or
der and good government will be cherished,
and, under Providence, we will eontinue to
; be a prosperous and happy people.
There is some opposition still existing to
our system ef Common Schools: nor is it
to be presumed that the system is without
some objections, or that any general law
could at once be put in operation, that would
ntrai Willi universal auuruun-uuii. j lie Bra-
tens established by the present school law
is, oomparitively speaking, new, and we
have not become familiar with the mode of
doing business under it; but it is doubtful
whether a better system, as to its general
features could be adopted; or one that
would give more universal satisfaction to
the people. Time and experience will sug-
frnet thA itafisitta in tliji npaaanf flehnnl law.
B ... r. .. ,
and they will, no doubt, be gradually remo
ved by legislative action, until itjs rendered
a perfect, and as satisfactory to the public
as any system which could be devised. Any
great and radical change, unless for very
obvious and weighty reasons is to be depre-
.1. ; . 1 :3j.
caiea; new experiments buouiu oeavoiaea;
and our legislation on this subject should as
sume a stable character. The law of last
' session, by removing the just causes of
complaint, has had the effect ef reconciling
in a great degree, our German population
to the present school law. I have not heard
of any complaints from this valuable and
patriotic portion ci our lenow cumin,
tinea they hare been permitted to an equal
r. participation with other citizens in the bene--fits
ofthe system.
1 would tesnecttullv call vour attention to
the ery able and satisfactory report of the
Superintendent of Common Schools, made
at the last sess'wn of the Legislature, on the
subject of school lands, and the proceeds of
snoot tanas, it win be perceived, upon an
f examination of that roport that several
townships in this state have been deprived
of school section sixteen, and have never
received any section in lieu thereof; and
that they are entitled, either from the state
arGeneial Government, to an equivalent for
ine-iana oi wnicn mey nave Been deprived.
Also, that there is a deficiency in one ofthe
MIUMEI
j
Volume III. --No. 37.
quarter townshiss, in the United States mi
litary school land, of four hundred and eight
acres, as found on actual survey, which
Congress would, no doubt, make good upon
a proper application. There were a large
number of fractional townships in th's state,
having no section sixteen, and unprovided
with school land under the original law. In
eighteen hundred and twenty-seven, Con
gress passed a law giving to each township
and fractional township, for which no previ
ous provision nan Deen made, school lands in
proportion to the size of the township, to be
selected in the respective land districts,
where the townships unpvovided for were
situated. The amount of school lands due
this state under this act, was about thirty
thousand acres. What proportion of this
has been selected, I am unable to state, but
no selections havo been made, as I am in
formed, in the Chilicotho land districts,
where a great number of these fractional
townships are situated, on the ground, that
theie is no suitable land within the district
subject to be selected. In all cases where
suitable selections cannot be made under
the law within the landdistritcs, Congress
should permit the selections to be made
from other government lands of the district.
This is so obviously just, that upon a pro
per application to CongresB, I presume they
would not hesitate to authorize selections
to be made from any government lands
within the state. I would respectfully sug
gest the policy of submitting the whole
subject to Congress, at the present session,
and asking that body to pass a law, provi
ding for those fractional townships, which
have been deprived of school section six
teen, and to authorize selections to be mado
under the act of Congress, of eighteen hun
dred and twenty-seven, from any lands be
longing to the General Government, within
the state. The only lands owned by the
United States within the limits of Ohio,
that are considered of much value, are the
reserved sections embraced within the lim
its ofthe Wabash and Erie, and Miami Ca
nal grants. These lands, it is expected,
will be brought into market, and sold the
ensuing year; and unless Congress can be
induced to act immediately on tlie subject,
their interference hereafter, can be of little
use to the state.
, Our school fund and the means of educa
tion have been permanently impaired by
that improvident system of legislation,
which authorizes, under certain circumstan
ces, the sale of our school lands. It seems
to me our true policy is, to retain these
lands for the benevolent and wise purposes
for which they were intended, and to au
thorize their sale in no case unless under
very peculiar circumstances, and when the
interest of our school fund would be obvi
ously promoted.
During the past year great embarrass
ment has existed throughout the country in
moneyed affairs, and especially in the east
ern cities. In this state our citizens have
felt the pressure to a considerable extent,
and are laboring under its unfavorable in
fluence, it has not, nowevor, laiien with
the same force on us as on the citizens of
some other portions of the Union. This is
owing to the fact that we are more an agri
cultural, than a' manufacturing or a com
mercial people; and, comparitively speak
ing, but little in debt. The embarrassment
and pressure among our business men in
Ohio, I am convinced, will be of but tempo
rary duration. Their business habits, ener
gy of character, with the great and increas
ing resources ot tne country, win soon ena
ble them to recover from their present diffi
culties. The mechanical and agricultural
portions of the community being generally
out of debt, have not experienced the same
embarrassments that have been felt by the
merchants, and those engaged in "heavy bu
siness, de.nanding large capital and exten
sive credit.
The contraction of the banks, and the
consequent scarcity, when compared with
former years, of a circulating medium, have
had a tendency to increase the embarrass
ments among our citizens in moneyed af
fairs. In May eighteen hundred and thirty
seven, the discounts of the banks in this
state were .nineteen millions five hundred
and five thousand six hundred and sixty
two dollars. On the thirtieth of Sep
tember last, they were eleven milllions, two
hundred and sixty-eight thousand one hun
dred and twenty-five dollars. Showing a
reduction in the discounts of the banks
since May, eighteen bnndred and thirty
seven, of eight millions two hundred and
thirty-seven thousand five hundred and thirty-seven
dollars. Their circulation has
boen diminished since the 90th April to the
30th September last, one million eight hun
dred and twenty-four thousand four hundred
and nineteen dollars and twenty -three cents.
Under this contracted circulation, our citi
zens are now called upon to meet their en
gagements entered into under our extended
ana highly inflated circulation when money
was plenty, and credit easily obtained, and
when they had every reason to believe that
they would be able to meet their engage
ments without any difficulty. This illus
trates the injurious consequences to the
community of a curreucy capablo of great
and sudden expansion and contraction.
The prominent causes, however, of the
present difficulties under which the country
labors, are to be sought for in the large a
mount of interest annually paid to foreign
capitalists, (variously estimated at from
eight to twelve millions,) for money borrow
ed by the Stales and Corporations, and in
the great and excessive importation of for
eign goods into this country, and the debt
thereby created. Our imports for several
years have annually exceeded our exports
to a large amount, leaving a heavy debt a
gainst us to be paid in coin. This debt is
now called for and must be paid. The coin
necessary to pay our foreign debt being
principally abstracted from tie bank, they
itre forced to curtail their circulation and
call in their discounts ; by means of which
our circulating medium has been reduced
for the last year by the double process of
specie exportation, and bank contraction.
The great evil of which we have cause to
complain is, the excessive importation of
foreign goods, greatly exceeding the ne
cessary wants and demand of the country,
and our ability to pay. This evil has had
its origin in the overgrown system of bank
ing, which his sprung up in the United
States within the last few years ; and the
cohsequent multiplication of bank paper
beyond the real business wants of the com
munity. The increase of paper money, by
rendering the circulating medium cheap,
naturally produced an increase in the price
of foreign goods. By this means their im
portation has been invited into this country
to Be sold at our paper prices, nut to as paia
for, either by our exports, or in cin. Our
exports being insufficient, our coin is re
quired to pay the balance. Until our for
eign debt is reduced, we cannot expect
much relief from the present prossure.
The present crisis is one that must be met ;
it may be postponed, but cannot be avoided
by legislative acl'.on. Our foreign debt
must be paid, not in paper money, but by
our exports, oi in gold and silver. An In
crease of paper circulation will not enable
us to pay our foreign debt, while it will in
duce a continuation of excessive importa
tions by keeping up the high prices for for
eign goods. Our permanent relief will be
found in the abundant crops of the country.
When they are brought into market, and
applied to the payment of our improvident
debts, the difficulties and embarrassments
under which the country is now laboring,
will cease to exist.
To avoid a recurrence of these evils, we
must, as a nation, import less, and export
more. We must rely more upon our own
resources, and not so much on foreign cap
ital. Tho credit system must be reformed
and made secure, end brought down to the
necessary business wants of the commu
nity. So far as this sysl em is within our
reach, it will be our duty to place it upon a
solid and substantial footing, and restrain
it within those limits which public policy
and the permanent good of the country re
quire. Other states will, no doubt, in due
time perceive the necessity of pursuing a
similar policy, We cannot hope, perhaps,
for an entire reformation of the paper sys
tem in the United States, until there is a
separation of the General Government, in
its fiscal action, from banks and 'bank pa
per. If this should take place, it will have
a salutary check on the over issues of the
banks, and admonish them at all times of
the necessity of keeping up a due propor
tion between their circulation and their gold
and silver. The recent demonstrations of
public opinion would seem to leave but lit
tle room to donbt the speedy passage of this
salutary measure into a law.
The subjoct of the enrrency is one in
which the people at this time very properly
take a deep interest, and is entitled to your
calm and dispassionate consideration. In
a growing business community line ours,
a sound and stable currency, adapted to the
business habits and wants of the people, is
of the utmost importance, and every exer
tion should be made to secure this desirable
object. The currency is one of the ne
cessary means of carrying on the commerce
trade and business of the country. When
it becomes deranged of unsteady and fluc
tuating value and either too plenty or too
scarce, every interest in the state is more
or less affected thereby. A standard mea
sure of value is as essential in a community
like ours as a fixed and certain standard of
weights and measures. We are as much
bound, by a duo regard to sound policy, to
secure the one as the other, by legislative
provision. The currency, not only of this,
but of all our sister states, is principally
composed ol bank paper. It has become
in a great degree, the only measure of val
ue by which the piice of every thing is fix
ed and regulated. It has driven principal
ly all the gold and silver out of circulation
aud usurped the place of the procious me
tals. The important part that paper mo
ney is thus made to perform in all the busi
ness transactions of life, and the imprac
ticability of returning to a circulation com
posed entirely of specie, and the strong
tendency there is towards increasing, in
stead of diminishing, the quantity of bank
paper, in many parts of the United Slates,
impoBS on the legislature the important du
ty of legulating and controlling, as far as
possible, paper issues, and guarding the
public against all possible loss, either by the
fai'ure of banks or a depreciation of their
paper. We are admonished of the neces
sity of this from the history of the past,
and what we see daily transpiring around
us. That a base and vitiated currency ia
one of the greatest evils with which we
could be afflicted, cannot be doubted by any
one who is capable of appreciating the ben
efits of a sound and steady circulating me
dium. That the present banking system
has filled the country with a fluctuating,
unsteady, and at times, a depreciated cur
rency, is demonstrated by its history for the
last twenty-five years. That it has been
occasionally used by men destitute of mo
ral principle, as a means of defrauding the
public out of large sums of money, is e
qually true. The public has witnessed,
year after year, a perpetuation ot these
wrongs by irresponsible corporations, un
til tho pohcy of permitting them to exist,
has hecome a doubtful question with some,
and the propriety and necessity of reform
ing them is conceded by all whose judg
ments are not swayed by interest, or influ
enced by the party conflicts of the day.
In a matter ef such great moment to the
public, we should lay aside our party feel
ings and prejudices, if we have any, and
act alone for the permanent good and pros
perity ol our country, in wgich ,we all have
an equal stake, and tho welfare of which
we all, no doubt, desire, whatever may be
our party predilections.
The means of obtaining a sound, Btable
and safecirculating medium, is a subject on
which lam aware, a great variety of opin
ion exist in the community. In a matter,
however, of so much importance,' a free and
frame interchange of opinion, and a full
and candid investigation of the whole
subject will be likely, in due time, to enable
us to adopt that course of policy best cal
culated to promote the general good. The
time is rapidly approaching when some
settled and definite policy must be adopted
in relation to our banking system and enr-
ency. Most ot the present bank charters
oxpireby their own limitation, on the first of
January, I84S. The policy hereaftor to be
pursued, should be sottled before the expi
ration ofthe present bank charters. Wheth
er the present is a propitious time to fur. up
on the settled policy to be adopted in rela
tion to banking and the currency, or wheth
er it would bo more prudent to wait the de
velopments of another year, is submitted to
your own better judgments.
I consider it impracticable for this state
to return to a hard money currency Each
state of this confederacy, possesses the
power of incorporating banks, and regula
ting them at pleasure. This power has
been, and most probably will continue to be,
liberally exercised By most or .tne
states. If we should dispense with banks,
it would not prevent the circulation amongst
us, of bank paper. There ia no way of ex
cluding bank paper from circulation, only
by the ootemporaneous action of (lie several
states. This is not to be expected. - If we
should abolish banks of circulation, the eon
sequence would be, that the notes of other
'.states would flow in among ns, and circulate
CIT Y
CITY, OHIO, SATURDAY, DECEMBER 14, 1839.
in the place of our own excluded notes.
The profit of banking would thus be trims.
ferred from our own, to sister states, with
out any advantage in return. If we must
have a paper currency, it is better to have
one of our own creation, subject tb
our own control, and amenable to the peo
ple of our own state, than one issued by
corporations beyond our jurisdiction, and
til ,a.rh nf mm- Is... Tk. 1 i .. 1
...v w.-.. vi wu la.i IJQ puilbjr, I1UW
ever, of dispensing with banks of circula
tion entirely, is advocated by but few, and
perhaps without full consideration ofthe
circumstances by which wc are surrounded.
The great majority of the public acknowl
edge the utility of banks, in the business
transactions of life, when Ihey are estab
lished upon proper principles, and confine
their operations to legitimate banking;
In my inaugural address, I took occasion
distinctly to state my views on this subject,
I then stated as my settled opinion, " That
our system of credit to which we have long
been accustomed, could not be destroyed
without deranging to a great extent, the
business order of the community. That our
policy, therefore, should be, not to destroy,
or impair that part of our credit system,
which exists in the shape of bank paper,
but to place it upon a more solid and sub
stantial footing. That currency which is
best adapted to our various wants, long bu
siness habits and all the circumstances by
which we are surrounded, is one composed
party of gold, and silver, and party of bank
paper, made safe to the public, and convert
able at all times into gold or silver." These
were the views which I then expressed, and
still entertain on this subject. However
difficult it may he to reform our banking
system, so as to make it safe to the commu
nity, and at the same time render the cir
culating medium in some degree stable and
uniform, I believe it is not entirely imprac
ticable. The great object to be obtained is,
a circulating medium of uniform value, con
vertible at all times into specie, and made
entirely safe to the community: Cannot
this object be obtained by any system of
banking which can be devised! Although
I am free to admit, it cannot entirely, yet I
believe we can come so near the attainment
of this object, as to answer all practical pur
poses. ' In order to do this, various systems
of banking have been suggested a state
bank with branches a free banking law
and a system of independent banks, such as
now exists, with modifications restric
tions, have all been mentioned, and the
claims of each to superior excellence have
been pressed upon the consideration of
the community . j
A state bank, with brandies, owned en
tirely by the state, aud under the control of
the agents and representatives of the peo
ple, and where the whole profits on the ca
pital invested would be paid into the public
treasury for the public use, it is claimed by
its friends, would command as mich public
confidence, and furnish as sound and as safe
a circulating medium, as any system that
could be adopted that it would be free
from many objections to which other sys
tems a.-s obnoxious that it could not bo
charged with being a monopoly, because the
stock and profits would both belong to the
people that it would be more regular in its
action, and adhere more closely to the legi
timate business of banking than like institu
tions, owned and controllsd by individuals.
There are objections, however, to putting
this system into operation, which appear to
me too formidable to be overcome. The
banking capital of the state on the thirtieth
day of September last, was over ten mil
lions snd a half. A state bank to supply
the place of the present banks would re
quire an equal amount of capital, which
would have to be procured by a loan in some
shape or other. The state is now largely
in debt and engaged in public improvements
which cannot be abandoned without losing
a large amount of money and labor already
expended. Tho completion of these works
will swell our actual debt, which we will be
compelled to pay as it falls due, to upwards
of fifteen millions. Would it then be wise
policy for the state to adopt a system of
banking which would increase the debt or
the state, say hve or ten millions! could tne
funds be obtained on a loan without extend
ing our credit beyond the limits of prudence?
Or could they be obtained on any terms, or
such as would justify the state in taking
them? These are questions, in my judg
ment, worthy the serious consideration of
those who advocate the creation of a state j settled policy of banking, and bank paper
bank. It would bo difficult to keep such an was at all times convertible into coin, that
institution entirely free from political influ- exchanges on the eastern cities would ulti
ences, snd party conflicts. It is greatly to matel, settle down to something near the
be feared that it would partake of the po- cost of transporting specie from this to the
litical impulses of the party in power, which desired point. This ought not to exceed,
would entirely destroy its useiuiness as a
banking institution, and bring into the poli
tical field a corrupting moneyed influence,
hostile to tho genius of our free institutions.
Tho same objections, but not to the same
extent, apply to a state bank, where the
stock is in part owned by the stato, and in
part by individuals. No peculiar advan
tage or benefit belongs to a state bank
where the stock is principally owned by in-
dividuals, which would consequently give
them the management and control of it.
The policy of mixing the funds of the state
with the funds of individuals ia any enter
prise, I consider questionable. It any loss
is sustained it will generally be made to fall
on the state. I am aware that in several
of the states this system has been adopted,
and has, to a great extent, the confidence of
the people. But when we come to exam
ine it, we will find it liable to all, or nearly
all, the obiections that can be urged against
a system of independent banks properly li
mited and restrained. It would seem to me
that we would gain but little by this system
of banking, while if we adopt it, we would
be forced to increase the debt of the state
in some shape or other, to a considerable
extent. . . . .
The system of free banking is, compara
tively of recent origin in this country, and
may be viewed in the light of an experiment.
Whether it will answei the purposes, and
fulfil the expectation of its friends, is doubt
ful. Tie objection to it as a system calcu
lated to furnish a sound and steady curren
cy, is the unbounded field it would op;n to
paper issues. Requiring bankers to pay
their notes on demand in specie is not an ef
fectual check against over issues. Bank
paper is easily made, and the temptation to
put an undue proportion in circulation is oc
casionally great. It will not do to trust en
tirely to the commercial law ot sippiy and
demand to regulate tlie amount of paper
circulation. The demand for money, or
that which passes for money, is as unboun
ded as the avarice of man. Too much pa
per money is more injurious in its ultimate
effects on the community, than too little.
I should consider any system of banking
EXPIRE ' . .
radically defeotive, which did not regulate
the issues of the banks, and the amount of
paper which they could put in circulation by
some fixed rule. In a state bank, or a sys
tem of independent banks, the amount of
bank capital can be fixed by law and made
to correspond with the wants of-the com
munity; and the amount of paper which
they may put in circulation can be limited
by their charters, and regulated by the
amount of specie in their vaults. This
cannot be done in any systom of free bank
ing which has come under my observation,
without destroying its distinct character.
We have seen in the state of New York.
where this system has been recently intra-
duced, banks organized under it, in one year
uaving an aggregate amount ol incorpora
ted capital of over four hundred millions.
In the state of Michigan the same system
has been tried and failed. The difficulty at
procuring state stocks, and converting them
into money wnen required and the uncer
tainty of raising money by sale of lands,
mortgaged, constitute objections to tho
adoption of this system in Ohio worthy of
cuusiuerauon. nowevor plausible in theo
ry it may appear, I doubt whether it is the
Dost means that can be adopted to secure
the end in view, a currency of uniformity
and steadiness of value.
A system-of independent banks properly
restricted and limited in their power, placed
under the supervision of bank commission
ers, and beingat all times under the control
of the legislature, if not the best system
that could be adopted, is perhaps the best
within our reach, at the present, or for some
time to con-e. In adopting this system,
however, there are certain principles and
provisions which I would deem essentially
necessary to be incorporated in it in order
to guard against the abuses and evils which
belong to the present system.
E ten stockholder should be held person
ally liable for his proportion of the debts of
the bank, to be estimated according to the
amount of stock owned by him. No bank
should be permitted to extend its liabilities,
exclusive of deposits, beyond three times
the amount of specie in its possession at the
time of such extension. Each bank should
be required to redeem its notes in gold or
silver while it had the means of doing so,
snd if it refuse so to do, or if it suspend for
the want of means, beyond a limited time,
in either case it should be deemed a for
feiture of charter, and visited with suitable
penalties. All notes of a less denomina
tion than five dollars should be carefully
excluded from circulation. Each bank
should be required to publish, at stated
times, under tho oath of the proper officer,
a true statement showing its condition.
The directors should be prohibited from
borrowing money out of their own bank.
No bank should be permitted to issue post
notes for circulation. The banks should
be prohibited, under severe penalties, from
dealing in produce or merchandise, or buy
ing the issues of other banks at a discount.
While these restrictions would remedy, to
a great extent, the evils which now exiBt in
the piescnt system, they would in no way
operate ajjainst fuir and legitimate banking,
or prevent capitalists troru realizing a liner
a! profit on their bank investments. They
would operate solely on the fraudulent or
reckless banker, and guard the public against
all loss. If the system of independent
banks should be adopted in Ohio, with these
principles of reform incorporated in it,
with some others of minor importance, and
firmly adhernd to, I believe it would, in due
time, command the entire confidence ot
the community be entirely safe and secure
to the public, and furnish us with a circu
lation which would approximate as near
uniformity and steadiness ot value, as can
be hoped for under any paper system which
we can conveniently adopt. This system
could be adopted in this state and carried
into successful operation without producing
any sudden shock in the business relations
ot the community.
All that is necessary to regulate the ex
changes of the country, and bring tbem
down to the true point is, to secure a sound
currency capable at all times of being con
verted into gold or silver. " Exchange is
an order for the payment of money in ano
ther place," and should never much exceed
the cost of transporting specie to that place.
Whenever it is beyond this, it is too high,
and owing to some artificial cause. It is
obvious that if we had a permanent and
ordinarily, more than one per cent., and is
t le true principle which must in time regu
late the exchanges of this, country.
Tne banks in this state, judging from
their last quarterly report, are generally in
a sound condition. It is highly creditable
to them that they have, with few exceptions
cuuuiiueu iu nueeietinii uu.ee uu uc.ciiu,
While like institutions eltiOwhcre, have been
under the necessity of suspending specie
payments. It is much to be regretted,
however, that a few of our banks deemed
it advisable to pursue a different course.
Whether this was with a view of prevent
ing specie from being taken out of the state,
Sir whether they were governed by other
considerations, I am unable to say. How
ever correct their motives may have been
in suspending specie payments, the e licet
on tiie currency is unfavorable. It is much
better to lose a portion of our specie foi a
time, than that public confidence should be
destroyed in these institutions, and the
country filled with a depreciated currency,
which must necessarily take place when the
banks fail to redeem their notes on demand.
Most, if not nil the suspended banks are,
however, paying specie for their notes.
In presenting my veiws on the subject of
the currency, and the improvement of our
banking system, at this time, it is dono
more with a desire of eliciting a full invest
igation of the subject, than with an expec
tation that they will meet with the entire
approbation of a majority of your honora
ble body. On a subject admitting ef so
many various and conflicting views unanim
ity cannot be expected. Believing, howev
er, tin1 the best way to arrive at safe and
satisfactory conclusions upon this, as upon
all other qnestions is, by a free and honest
interchange of opinions, 1 have taken this
' . .
occasion for presenting mine, on the curren
cy, and the improvmcntol our banking sys
tem. The whole subject is submitted to
vniir A0.11ai1lrtrn.Linn. and unon vour wisdom
anil nnulancn the nulilie rnfv with well I aent oonlractaon the publle worke This ie demanded
ana prudence, tlie puuilO re y w lln. w?" I b, the beet Interest of the Slate, and Ihe high regard we
founded Confidence, that the best Will bejuid always have for our engagemenle.
done for the irood of our country. 1 Thetimehaa already arrived wlusnwearefbreedby
t e L.Tl i . ,,m , 1. .-, the diotatee of prudence to pause and ooneliier what oau
If you should not deem the present . done lotrreel the acoiimuUtlonol our Slate debt -Suitable
time to adopt a permanent system Under the 'act in lutlioriae a loaa of ctedii by ike
Whole No. 141.
of banking for the Stats I would respectfully
suggest the policy of extending the time of
outu oi ma nanus as von m.v
judge worthy of public confidence, for wind-
up tnoir ousiness, lor three years after the
expiration of their charters in eighteen hun
dred and forty-three. Many of the banksof
tne state have commenced already the bu-
".- oi winuuig up, unner tne pretext that
the time their charters have to run is not
more than sufficient to enable them to close
their business. The enormous rate of in
terest at which capitalists can loan out their
money upon private loans, holds out atrnno
inducement to them to withdraw their funds
from banks. Extending the tim- of tl,
banks for winding up, will do away with
any real necessity which they may consid
er themselves under now, to commenco tne
business of closing up their affairs.
You will be better able to judge ofthe ex
pediency of this measure, however, when
you shall have leceived the report of the
bank commissioners. Their report will
give you a detailed statement of the present
condition of the banks, and enable you to
determine how far any of them are entitled to
public confidence.
The practice of loaning money at an ex
orbitant rate of interest, ranging from ten to
fifty per cent., has become a great and
growing evil, and should be arrested by
a well guarded and highly penal usury law.
I would be willing to allow capitalists the
liberty of contracting for a fair and liberal
rate of interest. It invites capital into the
Stato, and it is frequently an advantage to
the borrower to be able to get money at a
higher rate of interest than six per cent.
But capitalists should not be perniited to
take advantage of the embarrassments and
necessities ofthe unfortunate, and bv loan
ing them money at an exorbitant rate of in-1
terest, precipitate their ruin. Ten uer cant.
is a liberal compensation for the use of
money, and all above this should be denoun
ced as usurious, and constitute a forfeiture
of both principal and interest.
Tho following statement from the Aud
itor's books exhibits the condition of the
State Treasury, and the diffreut funds of
tne state.
GSNIBAL RSVUIUB.
The amount of balance la thetreaaury -
on the I5th Nov 138
Amount from different sources-la 1639
.187,054 61 6
. 0.18,851 18 i
Total revenue
Prom this deduct the a
mount of revenue for
canal purpose 1768! 6S r
Amount ol sinking fund. .35,000 00 0
Amuunt tranilbrred
665,905 60 0
from revenue 10 make
up mate common
echnol fund 45.850 60 4
Amount oftnx on bnnke
sic. transferred 10 same 116.425 Kfl a
Amauot of drsfie re
ceived protected ...... 3,385 87 0
365,747 03
Leaving a balance fbr revenue purposes
From this deduct the umount orhl'll.'nJ
, 890,158 77 0
deemed at the treasury to the 15th Nor
. 187,076 14 0
Leaving the balance In the treasury or.
. 61 0
Canals.
The balance or ihle fund In the Inwa-
ry, nov. 1B.1S ...............
The ainoanr of tolls on
the Ohio CMiel up to let
Nov., im 396,75o 88 9
The amount of same on
Miami canal 78,1(7 16 I
The amount of same on
Miami canal exlenalon ... 983,11
i 654 S3 s
The amount of revenue tramuerred, af
ter pavliis Interest on domestie deht . ..
The amount received from sales of
Ohio lands
The amount from State lota aud water
The amount from the various school
lunus
Total
From this deduct amount
paid lund eumiiiuito
neie up to Nuv. IS,
IS", 70,651 U f
Amount paid on special
appropriation. ...... , 8,789 91 S
Balance In treasury
OOMMOS aCROOL FUJID.
Amount accruing from banks. surplus
Revenue, and .uteres! on school mud
for 1314
Amount of transfer of revenue ......
l 54.749 40 6
. . 45,8o0 59 4
Amount accruing from taxee on bauks,
etc., lur
. 71,844 63 0
Totaf
871,844 68 0
. 800,000 00 0
Deduot the amount paid the several
counties ...................
Balance In the tmaansy (71,844 63 0
SCHOOL PUIID SUaJcer TODiaTBIBUTlOlf.
Virginia military School Hind 11,618 88 4
RATIONAL ROAD.
The balenoe la the treasury, Nor. 15,
1KB . . V3,4'J5 96 0
The amount of tolla oollectetf Ibr
J3S 63,496 10 0
Total. . . . ad5.993 OR 0
Deduct the amount paid superintendent
10 nov. 15, 1UJS 60,918 79 9
Balance in the treasury, .... $78 37 0
The aggregate canal lolls received tor 8S was 9435,'
949 84 Tlie sinount reoeived Ibr 1839 le S47S.4d3 51.
showing an Increase of canal tolla thie year over last,
of a4x,534 17 The gradual iocrease of canal tolls ev
ery year siuce cne compieiiun 01 tn.se works, warrants
us in neiievins mat at no otstani uay, tne reveuue re
celved from this quarter win more than pay the inter.
eet on the oust of their construction. Whether all
the worke of interna! improvement which the rttatc baa
overtaken, will ultimately do this, ia doublOI. If.
uuuertaken, will ultimately do this, la doublbil.
however, our public works, ne a whole, when once
coiupieieu, .iinii yieio a euiiKieni revenue 10 pay tne
luterest on tne aggregate ceet 01 ineir construction,
nublic expectelion will be fully realised, and we wll
have no cause to regret the policy which led to their
completion. Wnen the public worse now in progress
ehall heve been finished, our dtate will be well provided
with the means of getting her eurplue produce to mar
kel. These great avenues, which enshle as to trans
port our egrlcultural productione from the Interior por
tions of the Stale to various points, as Intereet may dio
late, are celculaled greatly to euhauce the value of our
land open up a ready market lor the productione of
our eoil, and promote In n high degree, the prosperity
ofoureHale. Tfaet our eyBtem ol internal improve
ment, eo lar aa it baa been judiciously commenced and
prosecuted, la greatly cslculated to promote the interest
of theState, le uuiversally admitted. To ihie system
1 have alwayabeen end am deeiledly friendly and hope
that It may ultimately be extendi pilo those portions
of the Slate that huvo hitherto been overlooked and
neglected.
While we aexnowledged the urnttv of Internal Im
provements in develi-piiis the reeourose ofthe State, we
ehuuld not forget tliat prudence and sound policy re
quite, that they should be limlled bv their genernl utili
ty, and Ihe flscel ability of the Slate to carry them ou.
Our Slate debt le already upwarde of twelve miliioua.
On Ion millions and a half of this we are paying inter
eet, which conetitutes a heavy tux on the people. The
Improvements which we have already undertaken, mid
which the Stale ie under obligalioua to complete, will
rrquire Uie increase of our State dept to Of teen millione
This large debt, together Willi the great dilllcultlee aud
embarrwemenu experienced at the present lime in the
muneury affairs of theuountry, and the diluculty of
borrowing money on favorable terms to the feltate, ad
monlah us thst the utmost oaution eboukl no observed
loguard against undertaking, for the present, any new
works. Tlie moat rigid eouoomy eoou Id be Introduced
iulo tola branch of the public eervloe, and no more mo
ney ebould be borrowed for the ensuing year,
than will be necessery In enable the State to
meet her present engagements Front present ap
penrances, II la doubllul whether the Fund Commissi o
nara will be able to Drooure the means neceaaarv to
meet thecontracta on tna puNhj worke it would be
iruluousto theStau to permit Ihe progress of these
works to be Interrupted for the want offuuda. The
credit of the Slate would be impaired, and a large a.
mount of money and labor already expended, would be
lust and iheoontrectore materially Injure!, Every ef
fort snouio ne meue to enauie tne Dtate to meet tne pre
67,925.91 4 j
, 8,571 49 a
.. 509 00 0
85,691 00 1 I
(801,383 44 8
-717,879 77
.S4,448 67 8
cutecrlptlona by lb. ril.i. to l.7kiXJ?mZ1T K
water navigation rarnl.' p' ZlTl"
I he State debt nestoeon ineroaaed 11, tot fteVSC
ha. left do discretion IB tho executive, a. to Mm rJZr. '
"km II would In proper r the Si. I. to saeeerlks tor
lock. When any turnphte road, euiai or elackwalos
navigation company-makes II appear to Ihe Executive
that a certain amoiiot of stock baa been aubaorlbad by
Individuals, end that a certain proportion of the laaia
eubaeilbed hai been paid la and sipended on lb laa
provemout, It la made the duly of the Governor to sub
scribe, In tb. tot or turnpike roe. oomeaakaj,. tor tke
STIi .V """ bcnbej br liidirldoala, Tbaa.
the entire credit of the State le placed al Uae wHI oT
ineMcompanlea. Thej can InTolre the elate is a dobs
u an unlimited amount. I. ka. ,h. ,k,i
ba.e am SUU. debt, l.crewd d UoVbnoei
of tale .w, near two and one half MnTnS
companleeanlncnaelnswlth (real impklltrtL, iLlT"
with the Tlew of avalllut tbemeel.e of lu oTlrtonaZ
The calle on (he Oo.ernor to euliecrlbe on behalf oivkL
Stato to the etock of theoe comnanl-. .111 . JT
bljr Increaea, rather than dlnilnnh, for eonie Urns I
come. The ninde drawn from the State Ireeaary and.
inn act, nave not in a caeca been .nnlLMl 1- ta.
Judicious manner, and the polio; of the law uader ear
circum.tancee. I conelder very qoeetkinabie. Tho tm-
ureuiBte repeal m ,ni. law m reeuecUUIiy recOSUaeJM '
ed lor your cone ideratjoo.
The following statement ahowe the nanMSae orthsr
u.n.-, - m.b. .... uw hw ,e ascertain taenit
Permanent loan
Scrip ieaued to railroads ........ .
Subscriptions to- Turnpike road, Ca
9,05O,MS
.sxaVMS s
nal anu oiacKwater navigation com
panics ...........
Domestlo debt...
. . ,9e,7S SOU
. . 1,317,587 tSr.
. ..Jv9,4 IS-'
13rns,461 SI.
. . MOJUM 81
Surplus revenue loan'd from, euua Ilea
Tatal
From which deduct amount
paid
Turnpike Companies
Total 13,01I,3S as;
I have not been able to ascertain the
amount paid by the state on the Pennsyl-.
vtnin, Cincinnati and Whitewater, and Mi
lan canals. When ascertained, it shouldt
be deducted from the above.
The amount of the surplus revenue ofthe-
United States, received by this stale is.
$2,6-78,347,1!. This is not included in ther
above statement. Although we are liable
to be called on fop the payment of this mo
ney, yet we pay no interest on it, and it i
not piobsble that it will ever be required-
we snonra not, tnererore, consider it ib the
light of a debt. Our domestic debt, and then
surplus revenue loaned from counties, may:
be considered as perpetual loans. Oar'
permanent loan, scrip issued to railroad.
companies, and subscriptions to turnpike-
road, canal and BlucKwater navigation com
panies; after deducting the amount paid to-
lu-npike companies, will mine $10, 59J.49S
the amount of the debt of the state, which,
will have to be paid as it falls due. In tlii
statement I have taken no notice ofthe sink
ing fund.
Our public works during this year have
progressed as rapidly as- we had a right to
expect. Some difficulties and embarrass
ments have been experienced for the want,
of funds to meet the estimates-
The national road may be said tobe m si
rea sonable slate of repair, and is much im
proved since last year. This great tho
roughfare was in a ruinous condition when
received by the state, but it has been gra
dually improving under a system of contin
ual repairs. The tolls received on the roadr
being the only funds appropriated to keep it
up, their limited amount will not allow ef
repairs at all times, when the condition af
the road demands them. There is much
complaint ofthe high rate of tills that the
light travel on this road is compelled to pay.
It is very doubtful whether the high tolla
pad by this description of travel, is advan
tageous to the roadr cn in a pecuniary
point of view. A great portion of the light
travel, which does Tittle or no injury to tb
road, has been driven from h hi consequence
of the high tolls, while the heavy travel
which destroys the road, continues on it.
I would susirFBt the policy of so eraduatinir
1 the rate of tolls aa to reduce them on light
travel. 1 he tolls received, this year are,
$62,490 10 The tolls for the last year
were $52,370 78 Showing am increase
this, over last year, of t6,95 32,
There has been twenty-nine additional
miles ofthe national road completed during
this year, (that is, from the 14th to tb d)
mile stone west of Columbus,) and surren
dered by the General Government to thie
state, and accepted, and placed under tho
care of the Board of Public Works,
The improvement of the Muskingum ri
ver was put under contract on the 20th day
of October, 1836, to be completed in threo
years the time having now expired. Th
work originally contemplated eleven dams,
fourteen locks. and four short canals; but
a as so altered by the late board, as to em
brace eleven dams, eleven locks, and five ca
nals, overcoming on hundred and twenty
feet fall. Five of these dams, six of th
locks, and two of the canals are now com
pleted. The foundations of all the other
dams and locks are laid, and considerable)
progress made towards their coraple'ron.
One dam snd lock is in a backward state,
and will probably have to be re-let. The
whole of this improvement will be comple
ted noxt year, provided the funds necessa
ry, can be had.
The Hocking Valley canal, extending
from Lancaster to Athens, is forty-seven
miles in length, snd overcomes a fall of two
hundred and three feet. Sixteon mile of
this cana1, extending from Lancaster to
wards Athens, were put un Icr contract July
131 h, 1836, to be completed on the first day
of October, 1837. This division is now fin
ished, and will be ready for nse as soon a
navigation shall open in the spring. The
Lancaster Lateral canal connects it with
the main line and eight miles in length.
This canal has been purchased by the state,
and hence, twenty-four miles of the Hock
ing Valley canal will be ready for transit in
the spring. The second division of this ca
nal, sixteen miles in length, and cx'.ending;
from twe and one half miles above the fallf,
to the town of Nelsonville, was put under
contract on the I6,h day of OcUber, 1837.
to be completed in two years. Several sec
tions of this division arf finished and hav
been received; nearly all the locks and
heavy culverts are completed, snd the wholst
of the work is so far advanced, that no fear
are entertained of this part of the b'ne be-
ing ready for use by the first of July next.
The third and lad division of this canal, fif
teen miles in length; extending from Nel
sonville to Athens, was put under contra-t
on the fourth day of September last, t be
finished on the first day of October, 1840.',
This division was let on favorable terms tw
the State. The contractors have already
commenced work, but not much has. yet
been done, .
The Ohio canal has been in good condition
for navigation the who1 ef the season,
without any material interruption from . -breaches,
and a very large increase of busi
ness hns been realized over any former year.
The Walhonding canal it nearly completed, : '
with the exceptionof a few re-let sections, .
which are to be finished the coming season. , .
In consequence of anticipated difficulties in,
procuring funds, this work has not been
prosecuted with the vigor that more favora- 1
ble times weald have justified. Th Ver- '
non and Mohtcin canals, have been careful- .
ly re-located, but the want of func'a has pre- .
vented their being placed unde r contract.
On the 11th and 15th of September, 1837, '
fiere was put under contract ill that part
of the Miami einal extending from a point r
about three miles north ol 1'iqua, to ou
Mary's a distance of thirty-twe and a half ,
miles, including fourtoen and one half mils
of feeder,' and tho two end sinbankmsn'i of . .
(Concluded on la page.) -