The Madisonian. [volume] (Washington City [i.e. Washington, D.C.]) 1837-1845, 1837-09-16

time there was but one branch of he United States
Bank located Tin Boston) Notwithstanding the number
OF the collection DISTRICTS the handreds of pors OF entry,
the vast amount Of mercantle capital and commercial
enterprise employed IN these Staiss In Connecticut
these branch Of the United States Bank none
in Rhode Island. which. though small in territory, has
always been extensively engaged In foreign trade, and
possessed large amount OF capital So that even after
the first Bank OF the United States had been IN operation
twenty years. the State banks were more frequently
used places Tor the depose Of the public money than
the Bank Of the United States and its branches and
the fiscal concerns OF the Treasury in reference 10 the
collection, keeping, transfer and disbursement OF
the public money deposited 10 these banks, were well
and conveniently managed as "a reference TO that depo-
sted in the Bank Of the United States. When the
Bank Of the United States expired, in 1871 the
system Of employing the State banks continued and
extended and the whole collected through
the State banks, and deposited in them such Of them
selected by the Secretary al the Treasury, and
employed on such terms agreed on between The
Treasury Department and the banks, respectively and
have the authority Of Mr. Gaatin in lester written
in 1919, that no difficulty has been experienced IN the
transmission Of the public money and, with the ex-
cepon OF Norfolk and Savannah, the revenue has gene
rally been well collected as heretofore" What was
the cause extent Of the difficulty in the excepted
places am not informed, but presume they were tenn
porary and uncomfortable.
hold in my hand extracts which have taken from
the speeches made by gentlemen belonging to each Of
the great political parties which divided the country In
1911, and had intended 10 refer the House to them.
Under present circumstances, however, will not read
them They prove that the opinion was universal, at
that time, that when the Bank Of the United States
ceased to exist the employment OF State banks must be
extended to those places where heretofore the Bank oil
the United States and its branches had been used
repositories All admitted that the only alternative
The friends of the Bank Of the United States insisted
there other; and, that would fail to answer
the purpose the Bank Of the United States ought to DO
rechartered and the other hand, the opponents Of
the Bank of the United States, contending that the
State banks had already been, TO great extent EN-
ployed that they entirely competent constitute
safe, cheap, and convenient agency IN enabling the
Treasury to collect safely keep aud conveniently dis
burse, the public money Through all this time, then,
from 1889 TO 1916 through oil administrations and by
all political parties and especially by that party which
was called republican," this internal agency Of State
banks IL has been characterized by Of my homo
rable colleagues, MIR RoBEaTsoN has been employed,
under the superintendent Of the Secretary of the TIea
sury, and, would seem, approved and admitted by
all to be the best in the absence Of Bank OF the United
States sam .a. s
1t is, then, (sad Mr. P.,) msappcaton Of terms to
call the agency Of State banks places Of depose for
the public money, experiment IL might have been
called so in 1883 But surely its having been tested by
experience Of its successful operation from that time
down to 1885, without the loss OF dollar to the rea
sury uses in saying that it is no longer proper to
call il experiment If any thing has occurred since to
show that il cannot be depended on, undoubtedly it
ought to be candidly considered and duly weighed It
is accordingly insisted that II has signaly failed since
1916, and that this proved by the of the
rency at that time, and by the million Of dollars Of
unavailable funds, in the treasury, which we have
regularly and SYSTEMATICALLY paraded before the
proof Of the inability of the State banks to furnish safe,
cheap, and convenient repositories These unavailable
funds consist OF the notes of nsolyent State banks
which failed years after the close Of the war, and
the notes Of which, to the amount above mentioned,
in the treasury and have not been redeemed and
OF balances due from some State bank depositores-
But do gentlemen suppose that we are so blind or that
we can be SO blinded not to be able to trace this loss
to its true cause Do not all know that the de-
ranged and unsound state of our currency, the depre
citation Of the paper of some Of the State banks and the
insolvency OF Others at that tme grew out Of the state
Of war! That all the resources Of the country, public
and private were put in requson to furnish the means
Of carrying war which, after ALL left with bur-
den Of one hundred and twenty millions of debt |! Can
there be any man who supposes that there is something
SO magical in the name Of the Bank of the United States
efcacious in the fact that it created by the Co
vernnent, instead OF by the State Governments, to
believe that if the Bank Of the United States had been
IN full operation during the war; the same arrangement
Of the currency would not have occurred-the
suspension Of specie payments the depreciation Of
paper, and that OF other banks The necessities Of the
country compelled all the State banks to stretch their
credit TO the utmost to assist the Government until it
which did not close their vaults all active bust
ness, and refuse all aid to the Government, in
voved IN the common calamitics- OF the war, which
affected the value Of every species Of property, and
visited with its infections all the Of trade and
every ramifcaion Of society. II was in the midst OF
this state OF things that it was suggested to Congress-
through the Treasury Department, aid the
Of the country by establishing Bank of the United
States, which should be compelled loan the Co
ver'ment, when required, thirty millions dollars and
was authorized to dispense with specie payments with
the consent of the President This project failed in
Congress. It was demonstrated by Mr. Webster, then
a member OF this House-and of whom may say, how
ever erroneous and Objectionable many Of his pol
cal opinions that he challenges the admiration Of all for
his profound sagacity and consummate ablityit was
demonstrated by him that it perfectly idle to esta
bsh bank such principes-that it would begin in
insolvency, and that the whole scheme little better
than sort Of legazed bankruptcy and yet such
the necessities Of the Government, and the peculiar
exgency of the times, that seemed, by many Of our
most patriotic statesmen, be demanded and justified
Congress, however rejected it, and passed sort Of
compromise BILL by vote Of 100 to 81, by which the
bank was not required to loan money to the Govern
ment, and was bound to redeem its notes in specie.
The veto was applied to this bill by Mr. Madison be-
cause of these features, which rendered the bill wholly
useless in relieving the country during the exgences of
war Who that looks back upon these historical remi-
niscences as to the pecunary condition and necess-
ties of the country, and the Of that condition,
be so visionary to suppose that Bank Of the United
States could have prevented the deranged state Of the
currency! could have protected its from de-
precatng could have avoided the suspension of specie
payments have relieved the government from the
cessty Of receiving its revenue in the Of local
banks and consequently, being exposed to and suffer
ing the very loss which is now, with much boldness,
charged to the Of the State Banks evdenceof
their untness TO be the fiscal agents Of the government
Bank Of the United States like all other banks, must
be affected by commissions in the political world and
vu'son in the world Of trade Treasury notes, issued
upon the credit Of the government, and for the redemp
ton Of which all the Of the country pledg
ed, know at depreciation Of than 20 per
cent in the market about the close Of the war; and
the Bank Of the United States ITSELF three years after it
went into operation, far from having corrected the