Richmond enquirer. [volume] (Richmond, Va.) 1815-1867, 1833-12-10


Public Deposites from the Bank of the United States
made 10 both Houses Of Congress, Dec. An, 1888.
TREASURY DEPARrMENr,}
December Sd, 1888
SIR: In pursuance Of the power, reserved the Sec
rotary OF the Treasury, by the Act of Congress- entitled
act TO the TO the Bank of the
United States, have directed that the depocs Of the
money of the United States shall be made in the said
Bank or Branches thereof but in certain State Banks
which have been designated for that purpose. And
proceed lay before Congress- the reasons which induced
me TO give this order and dire ciion.
The sixteenth section of the law above ntoned, is
inc following words And be further enacted that the
deposites Of the money of the United States, in places
which the said Bank and Branches thereof may be es-
tabished shall be made in said Bank Branches there
Of unless the Secretary of the Treasury shall at any time
otherwise order and direct, which case the Secretary
shall Immediately lay before Congress-
sessioh anu IL not, Immediately alter the commence
rection."
1t has been settled by repeated adjudcaons that char
ter granted by State to a corporation like that of the
Bank oil the United States, contract ween the so
vereisnty which grants it, and the stockholders The
same principle must apply TO charter granted by the
united States and consequently the act Incorporating the
Bank to be regarded as contract between the United
states oil the part and the stockholders the other
and by the plain of this contract as contained in the
section above quoted the stockholders have agreed that
the reserved the Secretary over the deposi,e
sha' not he restricted to any particular contingencies
be absolute and uncondona far their interests are
involved in the removal The order, therefore, OF tho
secretary oil the Treasury directing the public money
be deposited elsewhere, no event be
violation oil the contract with the stockholders impair
any right secured to hea by the charter. The Treasury
Department being entrusted with the the
finances oil the country, it always the duty Of the
Secretary in the absence of legislative provision
the subject, TO take that the public money was
deposited in safe keeping, in the hands of faithful
agents, and in convenient places ready be applied
cordDg to The wants OF the Government The law incer
poratng the Bank has reserved to him, in its full extent
the power he before possessed. II does not confer on
him power, but 10 him his former auhori
~, Without any new limitation The obligation to assign
the reasons Tor his direction TO deposit the money of the
United States elsewhere be considered as resc
ton oil the power, because the right OF the Secretary
designate The place OF deposit always necessarily
subject to the control Of Congress And the Secretary
oil the Treasury presides OF the Executive De-
Parimenis oil the Government and his power this
subject forms part OF the Executive du'ie Of his Office
the manner in which is exercised be subject
the supervision of the officer to whom the Constitution
has conded the whole Executive pow and has requi
red TO take that the laws be faithfully executed.
The faith OF the United States is, however, pledged
cordng to The terms OF the section above stated that the
puphc money shall be deposited in this Bank unless be
secretary oil the Treasury shall otherwise order Direct
And as this agreement has been entered into by Congress-
in behalf Of the United States the place of could
not be Changed by legislative act without disreg
pledge, which the legislature has given; and the money
oil the United States must therefore continue depo
sed in The Bank until the last hour Of its existence
less ii shall be otherwise ordered by the authority men.
toned in the charter The power the place OF depo-
:" the e wo%a seem properly 10 belong
is difficult to imagine why the authority to withdraw il
from this Bank was con6ded exclusively 10 the Executive
But the terms OF the charter appear be plain
mt OF questions; and although Congress should be salts
he'd that the public Of
Bank or should be convinced that tho interests OF the peo
Pile of the United States the reno
val yet the passage ola law directing be DONE would
be breach oil the agreement into which they have
Assuming this to be the true construction of the char
ter TO the Bank must be the duty of Secretary of
the treasury to withdraw the deposites of the public
ney from that institution, whenever the change would in
any degree promote the public interest II
ny that the dePoses should be unsafe order to Justify
the removal. The authority to remove is not limited 10
such contingency. The Bank may be perfectly solvent
anu prepared to meet promptly all demands upon it, 1t
may have been faithful in the performance of its duties
and yet the public interest may require depostes 10 be
Withdrawn And as that cannot be done without the
action OF this Department. the Secretary of the Treasury
would betray trust confided to him he did NOT csuse
the deposites 10 be made elsewhere the change
would advance the public interests, public
The safety OF the deposites-he ability of the Bank TO
meet It's engagemenisits fidelity in the performance of
its obigaonsars only part of the by
which his Judgment must be guided. The general inter
est and convenience OF the people must regulate his
conduct.
This principle distinctly asserted by Mr. Crawford
when he the Secretary of the Treasury soon after The
Bank obtained its charter In postscript to his letter to
the Presden OF the Mechanics Bank of New ok dated
February 18th, 1917, he says "The Secretary OF the
Treasury will always be disposed support the credit OF
the State Banks and will invariably direct transfers from
the deposites Of the public money in aid Of their Legitimate
exerons TO mdintain their credit But the proposition
OF the Bank Of the United States excludes the idea of pres
sure on its part, OF that appears
necessary at this time Other passages in the correspon
dence Of Mr. Crawford with the Banks about period
above mentioned might be referred to, equally indicating
the opinion; and that day doubt seems to have
been entertained Of the power Of the duty the
tary in relation 10 this subject Ii does appear TO
have been then suggested, that the right of reno
val depended the sovency Of the Bank or the safe
ty of the public money committed to its custody. On
the contrary in the passage above quoted the superior
safety OF the State Banks is by regarded
cessary 10 give him the right to make the transfer TO
them For he declares that he will give the deposes
the State Banks, account OF their weakness and TO
protect them from the Bank Of the United States, il by
means OF its superior strength it sought Cypress them
Nor any distinction be taken between the transfer Of
part, and the transfer OF the whole sum- remaining OIL
dcposite The language OF the charter recognizes such
Distinction and The principle asserted by DIR. Crawl ford,
would have led him 10 the removal Of the whole amount
OF the public money TO the State Banks f pressure on
the part Of the Bank Of the United States had rendered
Banks in Legitimate exertions maintain their credit
The language OF the law, therefore, and the usage and
practice Of the government under it establish the follow
ing principles.
LIST. That the power of removal intended 10 be
served exclusively TO the Secretary The Treasury, and
that according TO the stpuaions in the charter Congress
could not direct il 10 be done.
2. That the power reserved TO The Secretary Of the
Treasury does not depend for its exercise merely the
safety OF the public money in the hands Of the Bank
upon the fidelity with which il has conducted itsel but
he has the right to the deposes and IL is his duty
to remove Them, whenever the public interest
ncnce will be promoted by the change.
Taking these two principles unquestionable, pro-.
coed TO state The which induced to believe
that necessary for the interest aud convenience Of
the people that the Bank Of the United States should
cease TO be the depository Of the public money
The charter OF the Bank will expire, according 10 the
existing law the subject, on the 81 OF March, 1885, and
thorzed 10 the corporate name for the final settlement
aud liquidation the affairs and accounts Of the