Burlington free press. [volume] (Burlington, Vt.) 1827-1865, 1836-12-30
FRIDAY, DECEMBER 80, 1886.


credit. Our ancestors came here with no
money-but with far better things with
courage and industry; and their want of
capital was supplied by their mutual conf
dence. This is the basis of our whole
commercial and internal industry. The
Government received its duties on credit,
and sold its lands on credit. When the
sales afland on credit became inconvenient
from the complication of accounts, the
lands we're sold for what is termed cash.
But this was only another form Of credit,
for the Banks, by lending to those who
purchased lands, took the place IF the
Government as creditors, and the Govern
ment received their notes as equivalent to
specie, because always convertible into
specie. This was the usage this may be
regara"l as the law of the country. BY
the resolution Of congress, passed on the
30lh OF april 1861, was declared that ono
duties, taxes, debts, or sums of money,
accruing or becoming payable to the Uni
ted States as aforesaid, ought to be colec-
ted or received otherwise than in the legal
currency of the United States, or treasury
notes, or notes Of the Bank of the United
States, or in notes Of Banks which are
payable, and paid on demand. in the said
legal currency of the United Staies.'
This resolution presents various alter.
natlves--thc legal currency--or Treasury
notes or notes Of the Bank of the United
States--or notes of specie paying Banks.
A citizen had right TO choose any one
of these modes of payment. He had as
much right to pay for land with the note
of specie paying Bank, as to pay it for
duties at the Custom House. If this be
denied, certainly any one of them might
be accepted at The Treasury. But to pre-.
scribe all but one-to refuse every thing
but the most difficult thng-to do this
without notice ofthe approaching change
in the fundamental system Of our dealings
is an act of gratuitous oppression.
Under the operation of this resolution,
the Banks had gone on, fearing nothing,
as they had only to provide for the usual
specie calls upon them and saw the coun.
try full ofspece, with no foreign demands
to drain it from them when. on a sudden,
without any intimidation of the coming
shock, an order was issued by the Secre-
tary, declaring that their notes were no
longer receivable, and, of course, inviting
MI who held notes, or had dspostes in
| ihese banks. to convert them into specie.
II in fact made at once the whole amonnt
Of their circulation and private depostes
specie demand upon them. The first
consequence was, that the Banks nearest
the land Offices ceased making loans. The
next was, that they strove to fortify them
selves by accommodating specie. 1t was
Just at this moment that the warrants for
transfers were put into their hands. The
combination of the two measures produced
double result--first, to require the banks
generally 10 increase their specie, and next,
to give them the means of doing it, by
drafts on the deposites Banks. The COM
mcrclal community were thus taken by
surprise. The interior Banks making no
loans, and converting their Atlantic funds
into specie, the debtors in the interior
cauld make no remlttances to the mer-
chants in the Atlantic cities. who are thus
thrown for support on the Banks of those
cities at moment when they are unable
to afford relief, on account oftbe very abb
s,action of their specie Of the West. The
creditor States not only receive no money,
but their money is carried away to the
debtor States, who, in turn, cannot use 1t,
either to pay old engagements or to con-
tract new. By this unnatural process, the
specie Of New-York and other CONNER
cial cities is piled up in the Western States
not circulated, not used, but held as a
defence against the Treasury and, while
the West cannot use it, the East is suffer
ing for the want OF it. The result is, that
the commecial intercourse between the
West and the Atlantic is almost wholly
suspended and the few operations which
are made, are burdened with the most ex.
travagant expenses. In November, 1886
the interest OF money has risen 10 twenty
four per cent; merchants are struggling
to preserve their credit by ruinoas sacrifices
and it costs five or six times as much t
transmit funds from the West and South
west as It did in Nov. 1885, "a, or 3d.
Thus, while, the exchanges with all tn,
world are in our favor, while Europe i
alarmed, and the Bank of England itsel
uneasy at the quantity of specie we pos
sess-we are suffering because, from mer
mismanagement, the whole ballast OF tn
currency is shiftedfrom one side ofthe yes
! SCI to the other.
In the absence of good reason for ,hes
measures, and as pretext for them, it
said that the country is Over-traded--lha
, the Banks have over issued, and that tn
purchasers of public lands have been yer
extravagont. am not struck by the tru,
, or the propriety of these complaints. Tn
phrase of over-trading is very convenient
bnt not very ineligible. If it means an
, lhingit means that our dealings with olhe
countries have brought US in debt to thos
: countries. In that case, the exchang
! turns against our country, and is recllfie
, by an expectation of specie or stocks, in tn
> first instance, and then by reducing tn
imports, to the exports. Now the fact il
that, at this moment, the exchanges are
in favor of this country-that is, you ca
T.. buy n bill of exchange on a foreign countr
a cheaper than you can send the specie I
/ that country. Accordingly, much speci
comes in none goes out. This, too, at