Herald of the times. [volume] (Newport, R.I.) 1830-1846, 1837-06-01
From the National Gazette.
MR. BIDDLE'S LETTER..

letter to Mr. Adams from the President of
the Bank of III" u. States. which will be read
with not less interest and advantage than tho
preceding ones. 1T Is perfectly clear and
satisfactory exposition Of the existing state
of things, and cannot fail 20 carry conviction
to the minds of all Ii shows that the course
adopted by the Banks of Philadelphia was
impcraiivcly demanded by circumstances be-
yund their control, and that il will be most
conducive To- the ultimate benefit of the com
muniy and couniry-that the Bank of the
! United States has been actuatcd in this mea-
sure by the same spirit OF patriotism and
wisdom which has guided all lis proceedings,
and that il will be ready NJ moments warn
ing to do It's part in restoring mn''crs tn their
former condition of peace and prosperity.
PHILADELPHIA, May 18Th, 1897.
My Dear Sir: You were good enough To
express wish to know my own views of the
present state of things, aud hasten TO give
them without reserve.
You may perhaps remember that in my
| letter to you of the llth of Nov. last stated
what seemed the real causes of the cmbar-
rassmenis then existing, and the appropriate
remedies for them, adding that by their
adoption "conhdcnce would be restored in
twenty four hours, and repose at least in as
many days" Six months furih.r experience
has only confirmed that opinion. believe
now, as ! believed then, that the events of
this week might have been readily prevent
cd--and that the unhappy perseverance IN
the measures then deprecated has reduced
the country to its present condition. Eut
have 40 leisure now TO discuss the subject,
and no disposition to indulge in nnavallng
regrets. 1t will be more profitable to look
distinctly at the present position iihc banks
and the country, and 10 suggest their respec-
tive duties to themselves and to each other
All the deposit banks Of the government of
The y. States in the city of N. York suspend
cd specie payments this week-the deposit
banks elsewhere have followed their exam
pic; which was of course adopted by the
State banks not connected with the govern
ment. ! say of course, because 1t Is certain
that when the government banks cease 10
pay specie. all the other banks must cease,
and for this clear reason: The great creditor
! in the United States il the governncnt-lt
receives for duties the notes of the various
banks, which are placed for collection IN
certain government banks, and nrc paid H.
those government banks in specie it request
4 cd.
Il Now, if these Government banks, the de-
positories Of the public revenue, will not pay
specie, for the very warrants drawn upon
them by the Treasury-thc Government OF
the United States from that moment ceases
to pay specie to the citizens Of the United
States AS moreover the Government re-
ccives for duties only specie and the notes
of specie paying Banks, the instant its own
deposit Banks cease To pay specie, the Co
l.. n,fp
of its own deposit Banks and can receive no
notes except those OF Banks not Deposit
Banks. On the one hand then the Govern.
mcnt is bound to pay its debts in specie. and
it has no means of procuring specie except
from the Banks not connected with the Trca.
sury, so that these Banks find all thels notes
collected and paid into the Treasury tor du-
ties, converted Immediately into specie tor
tho use of ,hc Goycrnment-whilct the depos
it Banks will not pay their debts to the Other
Banks in specie nor pay the Treasury war
rants in specie. Take for instance this ex
ample. The claimant under the French IN
demnity had certain moneys due to him II
France. The Government imported 1t II
! gold for him-and when the day OF distribu
ton arrived he obtained an order Tor his 2or'
Ition. But instead of receiving his own share
ceved neither gold nor silver, but the notes
of the deposit Banks-whch very notes the
Government itself would refuse to receive
from this very claimant for any debt which
he might owe to the Government. So long
therefore, as the Government aud the CO.
vcrnment Banks will not pay specie to other
Banks, it would be Tashness in those Banks
to pay specie to them, and as they cannot
,,oln al ftnp IN ~ o.
will pay, the only alternative is to concur
with the Government Banks in the general
suspension. Our Philadelphia Banks saw
this. They thought it useless to carry or
! so unequal an intercourse in which they were
TO pay to New York. while New York re.
fused to pay to Pennsylvania; tor if the Penn.
sylvania Banks paid, while those Of New
, York did not, the whole revenue would have
specie demanded.
In the midst Of these disorders the Banl
Of the United States occupies peculiar po
sition, and has special duties. Had il con
suited merely its own strength, il would hav,
continued It's payments without reserve
But
/, 1si. Like all the other Pennsylvania Banks
\ it owed a duty to the citizens of our owr
I State; and it was not disposed to stand aloo
from general movement of the other State
institutions, which however it might regret,
it could not ccnsurc.
I'd. IT was not inclined, moreover, to dis
credit, by refusal to receive it, the paper oi
the other State Banks which had ceased Ia
pay specie, still less to force its Pcnnsylva-
mia debtors to pay their debts IN specie, when
other citizens in other States were allowed
10 pay in less costly mediums; thus breaking
down for the benefit of other States, the
merchants, manufacturers and mechanics OF
Pcnnsylvunia.
I'd. While the vaults of all the other