The Madisonian. [volume] (Washington City [i.e. Washington, D.C.]) 1837-1845, 1837-10-10
SPEECH OF MIR. GARLAND,
or VIRGINIA,


In The House Of Representatives. Of lie U. S.
Sept. IS, ls37-in opposition 10 the bill
reported BY the Commiitee Of Ways and
Moons, entitled, A bill imposing additional
duties as repositories in certain cases on
public e6ieers, and for other purposes:
(Continusd.)
Fromthe connection which existed between
the Government and the State Banks, growing
out of their adoption as fiscal agents, and the
general impression which it produced, that
the Government was disposed to cherish and
sustain them, the slightest manifestation Of
the want Of confidence on the part Of the Co.
vernment, was calculated 10 produce the most
disastrous effects upon their credit, and Grip
pie their ope rations 1t was calculated to i'm
pair general confidence, and produce rush
for specie, SO sudden and violent, that but few
banking institutions could be prepared to with
stand it. This rant n confidence ras clearly
manifested IN The Treasury Circular q July,
1886, IN ,chich danger uas distinctly announced
to the country. This measure Of itself, how
ever, could not have exerted any very delete
rious influence, upon the credit of the banks !;
but, operating in conjunction with other causes,
was calculated seriously to impair public
confidence, and to produce serious embarrass-
ments in the monetary system Of the country.
The Treasury circular, which required spe-
Gle for the payment Of the public lands, pro-
duced an unusual and unnecessary drain Of
specie from the Atlantic to the Western banks,
and of course, it was incumbent on the
Eastern banks, to use the usual precauion of
contraction to meet the demand, whatever it
might be. Independent Of this direct opera
ton, emigran,s, who were numerous from the
Eastern TO the Western States, sought that
kind OF currency which was receivable at the
Land Offices. Hence, specie being only re-
ceivable there, they demanded specie for their
notes, which being principally Eastern, the
Eastern banks were bound to pay These
drafts for specie were calculated to produce
corresponding curtailment Of the circulation
and loans Of the banks, which were among
the protested objects of the order The gold
and silver thus drawn from the Eastern, was
deposited in the Western banks, and there
kept entirely unemployed, to the great detri-
ment of trade, awaiting the, drafts of the Co
vernment. In addition to the operation of the
specie circular, and about the time of its ut
most severity, the pressure Of heavy foreign
uou' cieateu I'll duuiuohdl HcaVy ueHhanu lot
specie. which was principally to be drawn
from the vaults of the banks. The effect Of
this demand for specie to pay the foreign
debt necessarily produced a contraction of
loans and circulation, corresponding with the
extent of the demand We all remember the
gloomy period of 1919, when distress and
ruin pervaded the whole community, and filed
it with dismay, and as it is fair to Judge of the
present by the past, have selected the four
years preceding 1919, and the present pre-
ceding four years, with view to contrast the
state of trade then, with its present state in
order, in part, to account for the present re-
vnlsion and arrangement Of commerce, and
the effects now, as then, produced In the
years 1915, 1916, 1917 and 1918, the state of
foreign trade was as follows: