The Madisonian. [volume] (Washington City [i.e. Washington, D.C.]) 1837-1845, 1837-11-17

bank which gave il the power which the other banks
stood In dread Of II was the collection OF the public
money which threw the banks in debt 70 the deposite
banks at the time made the application TO The De
pariment. They therefore, did not feel JUSTIFIED in
adopting measure, undenxp-h circumstance, on
their own motion, howe n lsalutary il might have
been, or however much il might have been called
for by the then existing state OF things without The
appreciation Of the Treasury Department. Had The
suggestion al that time received official sanction,
do not doubt that such would have been the results
il would have produced, that should have avoid
ed altogether the calamity which has since beiaiien
US.
Had the increase of the deposie banks been con-
fined strictly TO the number actually called for to
comply with the act of Congress, and those which
selected for such purpose have been the prin-
cipa banks in the places where the selections were
made, apprehend the evils which have attended
the execution of the act, il was executed would
have been greatly mitigated Why three additional
banks in Boston with an aggregate capital OF but
little over million of dollars and one of them with
capital of Sl5000O only (Which has since been dis
credited) should have been selected and the appii-
cation OF bank from the same place with capital
of nearly two millions have been at the same time
passed by, could never understand The addition
Of ten banks in the States of Maine and New Hamp-
shire 10 the two previously selected there, while the
money transferred from Boston 10 them, was more
valuable to those States than in those banks, was
ever mystery 10 me- The selection Of a bank at
Charlestown, Mass. with small capital, one al
Brooklyn, N. r., with capital still smaller; and,
the last selection which made one at Wooster,
Ohio with capital OF but $4,000, as well as ma
ny others all appeared TO me unwise, uncalled for,
and not calculated 10 add 10 the reputation OF the
system.
Ii is under such circumstances, that long tried and
faithful agents, stand denounced, as having been
guilty of base perfdy and teachery--ihai system
which had worked well for series of years. and is
perfect is cast aside defective in itself and to cap
the climax, that of determination has been
waged against those agents and all who support
them '.@ F..
What would be thought OF policy which contem-
plated abolishing altogether the use of steam power,
because OF the explosion of boiler to an engine pla
ced under the direction of an uassiLfnt engineer?
The whole banking system Of this country, howe
yer much it has become extended in my judgment,
is equally subject to the control of the Treasury,
a steam engine be to that Of the engineer EN-
ploycd 10 superntend it,
IL has long been universally conceded, that for
many years, while the Bank Of the United States
collected the Federal revenue il possessed and exer
cised controlling influence over all the State banks.
II is now manifest that ii through the of the
public moneys alone, that il derived that omnipoent
power. But, lest some may be sceptical on that
point, | fortify myself with the testimony Of one of
the most accomplished merchants and practical inan-
ciers, (Mr. Loyd) which this country ever pro-
duced.
In letter to Mr. Calhoun Of the 9th of January,
1877 answering some inquiries as TO the period when
the u. States Bank would commence operations, he
remarked {" The Government can and riH gire TO ID
(the Bank) eventually paramount poicer and it2i.-
through It's dposites and the collection Of The rere
nue., all The otter moneyed institutions Of the co
try"
/ am furthermore fortified in the positions which
have assumed by those which have quoted from
the communication of the present Chief Executive
Magistrate that, whatever check the Bank of the
United States exercised over the State Banks the
liberal supervisory powers granted to the Secretary
of the Treasury, enabled him TO exercise for saluta-
nv purposes TO an equal extent over the Deposite
Banks, and through them over all The others Have
such supervisory powers ever been exercised II
they have not, is il right; does il comport with
true spirit of philanthropy and justice, to chargethe
banks with having caused the mischiefs, which, by
the exercise of those supervisory powers would have
been avoided II seems to me not. Why ought the
system, then, to be denounced and discarded under
such circumstances Why should the Banks
ployed to conduct it be condemned?
To my mind il is as clear as thenoonday sum- that
the tremendous lever which the collection Of the
public revenue establishes places in the hands of the
Treasury Department the most ample means,
through the supervisory powers which il can at all
times exercise over the State Banks, which it might
select for its fiscal agents, (Which should never ex
coed twenty in number) of regulating and controlling
the paper part of the currency and the banks which
issue it, effectuay than the Bank of the United
States ever did, when 1t was the recipient OF the
whole public revenue, and with much more certain
ty and permanency; because, it has been shown by
experience in England that the power to regulate
the currency, should be divorced from the autho-
rity TO issue currency.
Il is to be ardently hoped that the time isnot far
off when reason will take possession of her empire,
and justice ascend her thrones and that the innocent
will be protected and the delinquent be exposed.
In my two last communications have endeavor-
ed most sudiouSly to avoid saying any thing TO
wound the feelings of any one unnecessarily Ihave
sought to contne myself almost exclusively TO such
facts and public measures were called for to vim
dictate myself and the Banks represented, from the
charge of exerting interest antagonist to that of
the public Ihave also endeavored to vindcate those
banks against the oboquy, which has recently been
so UNNECESSARILY heaped upon them. How well !
have succeeded in these efforts remains to be deter
mined by the verdict of an intelligent and enlighen
ed community.
With great respect, ".
Your most obedien servant,
r. M. WHITNEY.
Washington, November IL. 1887