Richmond enquirer. [volume] (Richmond, Va.) 1815-1867, 1834-05-02
Twenty-third Congrcss.--Ist scss.
STATE RANKS

STATE BANKS.
Report Of the Committee of Ways and Means. ON the
employment 81 State Banks as repositories Of public
money.
Tread in The House of Representatives, April 90, 1884
Mt ok. RON The Committee oil Ways and Means,
made the following Report:
Inc Committee Of Ways and Means. In pursuance of the
MIRA resolution OF their former report upon tn. subject
oil the Bank of the United States aud the public depo.
lowing
ne House, by its vote, having decided -thst the State
Banks 'ught TO be contnued as ihe places OF deposite of
The public money, and that i, is expedient Tor ongress 10
to make iur' her provision by law, prescribing the mod. O..
selection, the securities TO be taken, ana The u.anper and
terms OF, which they are to be employed. the committee
ueemeu u proper, IN a measure OF so much Importance,
10 ascertain hon the Secretary Of the Treasury his Opt
mon and views, in regard TO- the regulations proper 10 he
auop'ei In the employment Of the State Banks as the de-
pos''ories OF the public money. aud fiscal agents OF the
Covernneni; aud also Tor his views in regard to the pto-
Sao'e effects which would be produced upon the csrrency
ny huen regulations. they accordingly addressed a let
Ter 10 fhs Secretary requesting 10 be furnished with tue
information desired. and here with report the answer which
has been received.
In determining upon the mode in which the deposite
Banks shall be selecteh, the committee are of opinion, tina,
q due regard 10 the pablc interests will make il proper to
leave the selection, in the brst instance, 10 the Head of
The Treasury Department., or to some other person desig-
mated by law; but when once selected, to pui. il out OF the
power oil the Executive TO discontinue such drpo.i,ory
wi'hon' The sanction aad appreciation OF Congress. Should
II however be deemed %expeIien, Tor Congress themselves
to designate, by law, the Banks which, shall hereafter he
employed as repositories, instead Of delegaiing The power
oi selection, in the frst instance, TO an Executive officer,
there could be 10 Objection TO that mode, provided il be
deemed practicable to make the selections in such a man.
"r d 10 project and preserve the public funds 10 be de-
posted therein.
The bill which they report prescribes-Firs the mode
In which, and by " HON, the State Banks hereafter TO be
employed as the >public repositories, siIall be selected.
Secondly, the terms and condition. upon which they shall
De empioyeh' The duies and services they shall perform,
and the securities which they may be reouired 10, give. in
order etieciuaiy 10 protect the Government against pos
sibie danger OF loss; and Thirdly, i, provides that, when
once selected, they shall he placed beyond the power and
COnlrOI oil Tile Executive ID DEPARTMENT. p xCent a . lar "a = tho
sale and prtdeHt management of the public revenue may
render such control Indispensable.
The bill resiricta the discretion. of the Executive and
places ii out OF The power OF that apartment 10 discontinue
the selected Banks as places OF public deposie, to eases
81 failure on the pat Of said Banks 10 GENTLY with the
terms AMI conditions on which they may be employed,
or to cases in which any OF said Banks may become un.
sale repositories OF the public money, and reserves TO Con-
gross The Ultimate control over the whole subject. Ry its
provisions the Secretary OF the Treasury canno,, during.
the session Of Congress, dismiss fiuin the service of the
Treasury any Bank Of deposite, without having FIRST oh.
tanned the sanction and spprobatiou of Congress; and if
during the recess OF Congress, any Bank shall ial or re-
luse 10 comply with the terms and conditions upon which
II has been Employed, or H., from the periodical returns Of
us condition and business, or Otherwise, the Secretary of
the Treasury shall deem Unnecessary, in o der TO protect
aud preserve the public interest, TO discontinue any OF said
Banks as pnblic depo.i cries, he is authorized 10 issue such
order temporarily, hui is required, at The commend sment
OF The next session, 60 export to Congress the reasons aud
the evidence upon which he has ordered such discontinue
ance, reserving TO Congress the rieh, ,oappreve or reverse
such order. Thus aitappr-b ension dhat The power of the
Executive over the seleoed Banks may be used "a a a.
vernmenial patronage, or for corrupt purposes, is eiTeclu.
ally removed. So long as The selected Banks shall con.
tinue TO perform the duties required OF them hy the pro-
Wis ons oil the bill (should il become a law) aud so long AS
they shall continue so TO conduct their business as TO keen
the public funds deposi;edhherein secure, ihey cannot he
discontinued a. The wil'oi the Executive, but will be en-
utled to their custody as mattrro of right, unless il shall be
me pleasure oil Congress to Withdraw them, or ci,ai &c
the place of deposiie.
The committee concur will, the Secretary Of the Trea.
sury in the views which he has presented in his letter. in
regard TO the importance of banishIng from circulation
bank notes OF the smaller denominations, aud of substitute
lnD pOIl and silver epttSf in tbai, ,I,,. ". -t-
less, to some extent, be encouraged aud effected through
the collection aud management OF the revenue. Congress
possesses 10 power to restrict the State institutions from
issuing small notes but they have the power to impose
as a condition upon which any Bank shall be employed as
a depository, that 1t shall Grst sipuldfe not 10 issue or use,
alter a given inture day, notes of the sinaIler deDomina-
lions, III the course Of It's business; and they have a RIGHT
10 refuse 10 receive in payment TO the United States, the
notes of any Bank which shall not cease, after a given Gu-
ture day, to issue small notes. The bill accordingly con.
ialns a provision TO this eject. designed TO induce The State
Banks to co operate in banishiug from circulation all notes
OF a less denominations than five dollars, after a given m-
ture day. In several States such a prohibition already ex-
lists, and III those States a metallic circulation has been
'nai%,%%"I y fave re place OF The small notes which have been
Withdrawn. IL may be necessary, hereafter. for CuupscH.
to extend the prohibition 10 the issue of notes below the
denomination OF ten or twenty dollars. But the commit.
lee DO not deem II e%zpedient, al this time, TO recommend
tia. the prohibition. should be extended TO notes above tbs
denomination oil fve dollars Should it hereafter be deem,
ed proper, Congress can adopt further legislative provi.
sions upon the subject.
1t will he perceived from tire letter Of the Secretary of
the Treasury here with reported, that further legislation in
'e.""V" W W C"f'i CONSTITUTES an important part OF his
scheme OF the currency. The Committee concur in OBI
nion, that it is Important Ina, further legal provision should
be made regulating The value ofioreign coits, and max
ing he foreign gold aud silver coins a tender in the nav.
meht OF debts, and also regulating lbe standard ofvalGe OF
our own coins.
They have, however, reported no bill upon The subject
oi tie CONS, because hiils upon That subject have alfeaJy
been brought before Tie House by a $ Iect committee 10
whom his particular branch Of The subject had been re-
ierred by the House. They concur in opinion that il is
important hey Should be acted OH at the present session
OF Congress.
TRBAsURx nEPARTMENT,)
April, 10, 1891.
SIR: | have The honor 10 acknowledge the RECEIPT of
your letter, OF the Th inst, aud proceed to reply TO tie in.
quires made by The Committee OF Ways aud Means.
In my report TO Congress at the commencement of The
present session, assigning my reasons for removing The
Deposifes from The Bank OF lhe u. States, expressed the
opinion tliat 4 corporation OF Ihst description, was not ne
cessary, either for the fiscal operations OF he Government,
or The general convenience OF The people.
One OF The arguments most ffegnenIIy Urged in favor Of
the expediency OF - Bank Of the United States. is the "a.
luiary Influence which IL is supposed 10 exert in securing
to the country a sound currency. II is said the State
superior power Is necessary, to keep them in check, and 10
control them in this particuldr-apd The argument il con
SANITY and earnestly pressed, that a Dauk OF the United
States is the ut and appropriate means TO accomplish this
object. d there be any force IN this argument, The pa.
per currency furnished by the STATE Banks, as we'll as that
issued by tbs Bank Of the L.. States, ought now 10 be in
a sound state.
The Bank Of the United States has been in existence
seventeen years and must have already exefted all The
influence in relation 10 the currency, which can ever be
expected from such an institution. And II II exercises =
wholesome and ssUtary control over the conduct Of the
State Banks. and restraints them within proper bOgads. II
has bad iUlI tinne and opportunity TO exert that power, and