The Madisonian. [volume] (Washington City [i.e. Washington, D.C.]) 1837-1845, 1837-08-16

the citizen. How important then that i, should
be preserved invioate-that it should be ven
Grated with sacred devoton-that il should be
observed with religious fidelity Among the
most alarming symptoms Of the decay of Re-
publican virtue and the prevalence of that
sclhshness which tends to corruption and the
destruction OF free institutions, IS the DISPOSE
ton to charter another National Bank Ihearti-
ly concur with our jefferson, and our Madison.
IN their views OF the fatal tendency of such an
institution, and should regard the establish
ment OF another, as the entering wedge to the
destruction OF our Republican system of gov
eminent. II is reflection upon the age, that
the business OF this nation, either foreign or
domestic cannot be conducted without the
aid Of an Incorporated company formed for the
purpose of profit from the use of their own
credit am opposed to the exercise OF any
doubtful power by the Federal Government
admit, that the banking system instituted
by the States, whose constitutional power is
undoubted, is very defective among other de-
fects there are of very serious character,
first, the power to issue small notes, which
drives specie almost entirely out of circula-
ton and second, the power to issue notes SO
far beyond their actual specie capital, which
cause those expansions that produce such
frequent and distressing commercial revul-
sions. With proper and salutary regulations,
| believe the State Banks will be entitled to
as much confidence, receive as much credit,
as National Bank and afford all necessary
and proper facilities to commerce. have no
dream that we can force an exclusive specie
circulation yet by wise and gradual prohi
bition of small notes, say under $50, a suffi-
cient metallic circulation may be infused into
the business of the country, as to confne
Bank notes to large commercial transactions,
and secure their convertibility into specie
when desired although the circulation would
be thus mixed, yet the base would be specie
and the currency sound.
If the States shall set about and correct
their Banking institutions, SO as to intuse into
them those sound principles and salutary rcgu-
lations which experience has taught to be ne
ccssary, then think they will be the cheap
est, safest and most convenient repositories of
the public money. The Federal Government
will then, in aiding these Banks, aid the peo-
pie generally, which will be a legitimate and
beneficial employment of its idle funds.
As to the scheme of divorcng the Federal
Government from all connection with any
banks, | regard it much more plausible in
theory than sound in practice. Ii the States
continue to establish banking institutions, 1t is
to be presumed they do it in accordance with
the ascertained wishes of their constituents,
and the paper of the banks will constitute the
general currency Of the courtry. Why then
should the Government find II necessary to
demand for itself sounder currency than is
allowed to the great body of the people If
the exclusive metallic system is sound policy
for the Government, then it ought to be adopt
ed for the people, | do not think it wise to
draw so strong line of distinction between
the currency Of the people and the currency
of the Government. What is sound for the
people will be equally sound for the Govern
ment. Experience has proved that the banks
although some losses may occasionally occur,
are safer deposites for the public money than
individuals. The creation of so many Trea-
sury agents or sub-treasurers as will be ncces-
sary to the perfection of this scheme, is objec-
tonable, because in the increase of these,
salaries and public offices will be increased,
whereby the already over-grown patronage
of the Federal Government will be enlarged.
The difficulty oftransporting specie from these
sub-trcasiry departments to distant points of
the country for disbursement will also be ex-
pensive and difficult. The absence of these
a la mode treasurers from the supervision Of
the President and their liability TO defalcations
constitute insurmountable objections, as will
the difficulty ofpublc debtors in procuring spe-
Gle amidst a paper circulation. There are
many other objections to the scheme which
have not time nor space to offer, which are
equally strong.
1t should be borne in mind, that we are
now completely involved in the Banking sys-
tenn instituted by twenty-five independent
State Governments, each Of which will proba-
bly, adhere to it in some form-how vain then
the effort if attempted on the part of the Fee
deral Government by the mere employment of
its revenue to overthrow all these institutions,
and how destructive the effects, could it be
suddenly accomplished. think the wiscst
and most successful mode will be to invite the
cooperation of the States to gradual rcforma-
ton of the banking system, by gradually re-
ducing their paper and enlarging the specie
circulation of the country
| am perfectly satisfied that as long as the
circulation of small notes is tolerated, the me-
tallic circulation cannot be sustained; specie
may be imported the country, but il will not
crculate-this has been tested by experience,
and hope will afford lesson by which to
direct the leading policy Of our States, even
In relation to the currency; restrict the crcu-
lation Of notes within the bounds of certain and
Immediate convertibility and enlarge the active
circulation Of specie, and the currency will
be as sound as the wits of man can make it.
| need now say nothing of the causes
which have produced the present state of the
country. The meeting of the next Congress
is near at hand, when full information will be
laid before the country, and censure fall where
it properly belongs, if it attaches any where.