The Madisonian. [volume] (Washington City [i.e. Washington, D.C.]) 1837-1845, 1837-10-31
COMMUNICATIONS.
foR THE MADIsosIAN.

/ No. Y,
mus, take il FOR granted. though the subject is
half exhausted that this writer has already urged enough
by way Of argument and authority, in conteslng OBJ
ecions, show that the State Banks ought TO, aud
must be- greatly reduced number and CONSIDERABLY
if not proporonably, enlarged IN slze. Nor u strikes
me- The point of time for State legislation to
begin the execution OF that wholesome work Fewer
hinderances may be reasonably expected TO exist
at any future period. The policy Of multiplying the
banks, at all times questioned by many citizens and
Legislators, and by them resisted with bad success, has
long maintained dominion over the councils OF the
States From $40 in number, the year 1880, with
estimated capital OF l45 millions they had increased
10 than 500, in 1885, with an authorized capital
Of more than 37S millions In most Of the States
man, not possessed of than ordinary intelligence
knows the Of the banks in the distant parts OF
the State in which he lives and man, actively and
extensively engaged in trade, knows the is
familiar with the Of many OF the banks IN other
States, with which IL would be most convenient for
Others all things else inviting Il, TO carry on business
with him Owing to this want Of kno~edge, which
insincible, while there many banks the business
Of exchange he carried through the medium
of currency, while the banks paying specie for
their II is this OF knowledge that confines
the notes Of specie paying State Banks to very limited
sphere The notes Of the banks of New York, while
paying spece for them have scarcely circulated at
all In Virginia. and in such amount TO enable
the merchant to collect and them, and thus effect
exchange through the medium Of currency was
done with the notes OF the late United States Bank,
which circulated freely in all sections OF the country,
and not because they soidy entitled 10
dill than the Of the State Banks, bnt because the
citizens Of the States familiar with them
than with the Of the banks Of distant States 1t
is this want Of knowledge inyincibe while there
many State Banks, that will eyerlastngly contne their
notes to very circulation, while the banks
that issued Them pay specie for them Denying spe-
Gle, as is the case, their usefulness within the
limited sphere Of the peoples familiarity with them i
greatly lessened Indeed, the specie in their vaults, is
lost the while to the holders OF stock which Yields no
dividend 1t is totally distracted from all uses AMI
mating trade Let Us escape, by degrees from its
consignment dleacss 1t will soon find invest
ment, convenient TO the community, profitable to It's
owners, enyenlng commerce.
The Just sancty Of contracts forms hnderance to
the reduction of the number Of the State Banks, at
period short of that to which their existence may be
limited by their charters The fundamental condition,
either expressed implied, which the legislatures of
the States have granted these acts Of Incorporation s
that the paper issues shall, demand, be redeemed
with specie Che privilege as il is in cases, to
suspend payment for sixty ninety days. does not at all
affect the principle When the specified time expires,
/ the privilege ceases.) Having stopped payment the
banks have failed fulfil their part Of the contract
VIII it be pretended that they may still enjoy all the
benefits conferred by the act OF incorporation, submit
ting OF It's provisions for the benefit OF the
community at largel This would be to aim a deadly
blow the elemental structure OF all contracts These
their corporate duty BY tins failure they have become
liable. 1t is competent 10 the law giving power Of
sonere,gn State TO direct the judicial authority, try
whether said banks have forfeited their franchise OF
longer being corporations, well their other fran.
chiscs and liberties" To say that the commonwealth
cannot prosecute in such case, because she stock
holder would be to say TO the banks that they may do
what they please and yet not forfeit their charters
their privileges Such a doctrine cannot consist with
the liberty OF the citizens with the essential attri-
bnes of just sOrereign power-Jast to the citizens
who pay allegiance To its laws .a.
! cannot consent in this age OF enlightened freedom
and bengnant laws, TO undertake formal manner to
yindlcate these views. II the main proposition to
ducc the number of the State Banks their respective
States, shall he avorably received viii not be all
difficult for those who acquainted with the admins
ative authority, to adapt the execution Of the policy Of
reduction to the circumstances Of each State. How it
may (pfo5ably) be best done in Trgiaia, have at
cmptod 10 indicate in the following letter. which was
published in the Richmond Enquirer
In reviewing the proceedings Of the called session Of
the General Assembly just terminated the objec, Of
which was to devise and minister measures OF relief
| the community and the banks from the disorders of
oycrradng produced by overbauking in this and other
States, the patriotic and Just man. whilst pcrcciyng in
the themper Of that Assembly much approve and APP
plaud, fail discover in some Of its "Acts''
matter for condemnation. Regarding the proceedings
whole think the constituent body will concur with
me in the dccaraon that the Assembly might, with
great propriety, have blended with their cemency TO-
wards the banks little more ntcnseness Of regard for
the rights OF the people, under their constitutions and
laws To conquer and correct this unoward temper Of
excessive clemcncy towards the banks, the part Of
their representatives, let the people forewarn and i'm
press upon them, that there is class Of men,
10 whom the vicious order OF things, in the present
banking system, lends undue asccndancy, and who
busy in divers ways and with trim devices, to Just ~
such state OF society to the eye Of reason Who
4 they required cast the lots assigning them
place society, would strcnuonsly condemn the very
order Of things from which ihty derive exclusive
advantage On the other hand let the people forewarn
and impress upon their representatives, that there
| numerous class Of men, who, in the attempts OF the
legislative power Of the State rectify the existing
vicious order of things will be clanorous and eager,
under various and specious preences OF promoting
general welfare, TO have other laws passed and other
institutions established, which will confer on Others than
the now favored class, advantages unequal and der-
mental to the rest Of the community. In word let the
people impress It upon their representatives, that, what
ever course Of legislation they attempt the public good
and equality Of rights should be the gateway by which
they should strive to enter and the polar at which
they should aim, in restoring rather, securing,
sound currency To be particular let the people
orewarn and impress upon their representatives that
IN their attempts 10 the banking system of the
State "a reform cannot be accomplished as some sup
pose It may by granting charters TO all who apply for
them. IL would be rational to attempt to abolish
political arlsocracy by multiplying the number Of
blos The experiment has been tried in Germany"
the other in nearly every Of the United States Of
North America.
In reviewing those proceedings, four important topics
arrest the attention. To two Of them, purpose adj
vert briefly in praise the other two, think, ought
TO find favor with the constituent body: