The Madisonian. [volume] (Washington City [i.e. Washington, D.C.]) 1837-1845, 1837-09-12

q
face not only this, but its being receivable in
the first instance for all public dues. Il
would possess the highest credit attainable
in society.
As practical illustration Of their probable
utility and convenience, even the drafts,
though exposed TO several disadvantages
which would not exist with the certificates,
are near the par of specie, and furnish such
facilities for large payments and distant remit
tances that the amount of them, on both banks
and collecting officers, kept out unreturned,
has increased within few months from the
usual aggregate of about two millions TO near
ly four and half millions.
II the demand for such paper increased, public and
private convenience might be promoted and an equal
quantity of specie at the time preserved IN the
country by reservng for this purpose, from any accu
mutation IN the Treasury, sufficient sum, and by
placing at few important and convenient points, to
render greater number OF certificates fedeemable there
with the very coin, whose representative they are IN
tended, and honestly ought to be-
All the advantages OF these certificates could thus be
furnished, by merely paying them out to the public
ditor when desirable TO him than specie. But no
loans OF them appear advisable, any bank ncopora
tion bank officers bank machinery whatever, in
nexion with the subject. They would combine the
most important requisites apperainng 10 any paper
cunency-such the greatest security, entire spe-
Gle basis and the unity Of all issues body while
the control these last which very desirable
to preserve independent would be pacedan regulated
by law TO prevent any interested injurious ex-
The whole risk would be the loss by casualty
unfahulness Of any OF The specie that was held to
redeem the paper, and which, well the expenses
would probably be in part remunerated by the loss Of
certificates before they returned II the residue Of
the expense should constitute any considerable objcc
ton the system, il could be fully obviated by mode
rate and fixed premium for the certificates, either when
issued or redeemed.
The common drafts of this department, in their pre-
sent convenient FORM possess another advantage which
would sometimes be impaired TO the certificates. When
used at places against which the balance of trade
iss but drawn places in whose favor is, the for
do now, and may hereafter, not only facilitate
sentially the domestic exchanges but at the same time,
supersede numerous bank transfers, and the more ex
Pensve transportation Of specie itself
The Mint certificates, heretofore given on
the deposite Of bullion and specie, for coinage
might easily be made running TO bearer or or
der, and receivable for all public dues and
in that way, would contribute to the same de-
sirable ends
The present branches Of the Mint, if not
numerous enough, nor situated at convenient
places for the receipt of specie and bullion for
this purpose, might be aided by two or three
agencies, instead of more expensive new
branches, at points favorable to the interests
of the Mint and of the community.
1t must be obvious that the paper of any
bank will be less safe and useful in being re-
ceived for public dues, in proportion as it may
want such solid securities and foundations as
the certificates before described. But il the
notes of State Banks are made receivable for
such dues, under certain limitations like those
which have been explained, the other most
desirable guarantees for their safety, whether
looking to any use of them by the General
Government, or to the durable interests of the
States themselves, seem to be for the latter,
first, to impose on the existing banks, SO far
as lawful, the checks mentioned in subse-
quent part of this communication. They could
next authorize very few banks hereafter, ex-
cept those of mere discount and deposite and
where the power Of making paper issues to
pass as money is added power so sove-
reign in its character, and SO indispensable to
be visilantly guarded, could require large
proportion Of specie to the circulation and de-
posites to be kept on hand, and in addition,
have the faith and security Of the State
pledged to indemnify the community, as in the
case of the above named certificates, would be
pledged those Of the General Government.
This would greatly increase the caution and
watchfulness of all concerned, and could be
done by special laws for that purpose, or by
allowing no new banks hereafter, except State
Banks so organized, or by requiring State
stocks to be owned by all the banks, and
lodged in trust to the extent necessary, with
the specie on hand, to secure the immediate
redemption of all the bills issued, and all the
deposites payable on demand. Another kind
of security beyond what now generally exists
would be, never to permit deposites to be re-
ceived, payable on demand in specie, Ia prac-
tice SO very dangerous to the bill holders,) ex-
cept in the case of special deposites kept for
moderate compensation. The only other
description of security which is likely TO prove
in any degree efficient, seems to be of a penal
of bankrupt law to all banks as before sug-
gested in respect to such as may be fiscal
agents, or by allowing all depositors, public
or private, and all bill holders, not only large
interest, but severe prosecutions against the
directors after any deliberate omission by
banks to discharge their duties in the manner
provided in their charters and contracts. The
paramount object in all such provisions should,
of course, be to guard against abuses, and re-
form existing evils, though in some instances,
the case may have become so desperate as to
require even amputation to save life. Every
thing else concerning bank paper is supposed
to belong to the wisdom and sound discretion
of the several States, as they may prefer, from
time to time, to create and employ it. With
in the constitutional limitations, and as soon
as deemed expedient by any Of them, specie
as considered preferable by each for its own
purposes, can be if it be not now, established
At the same time, il is hoped and believed that
no wish exists in any quarter to prevent, but
rather deep and general anxiety, like that
evinced by Congress, the Executive and this