The Madisonian. [volume] (Washington City [i.e. Washington, D.C.]) 1837-1845, 1837-12-01
COMMUNICATION.
For THE MADIsoNIAN,
THE SPECIAL DEPosITE PLAN.


This plan for the safely keeping of the public
funds, between the periods Of collection and dis
bursement, has been urged by its advocates upon the
adaptive favor of the country, with more zeal than
distincness. The people have moi been told by them,
whether il is recommended and Landed as tempo
rary expedient and fit resort during The suspension
of specie payments by the banks, merely; or, as a
permanent measure and expedient resource, after the
banks shall have resumed specie payments
In the preceding letter. the exceliency of this plan
as temporary expedient is admitted. The reasons
are there assigned for the admission. For the same
reasons il is now admitted that it would be an ex-
cellent plan, permanent measure u the notes Of
the State banks, when specie payments shall have
been resumed by Them TO be rejected in all col
lections Of Government dues. But the fact is that
the advocates of the plan srenuousy and truly insist
on the wisdom and sound policy of receiving the
notes of specie paying State banks in all collections
of the national revenue; while they who oppose such
receipts, would reject altogether the aid and agency
of State banks in conducting the national finances.
The views of these thorough opponents of State bank
agency, have the merit of consistency, the one with
the other. If the collected revenue cannot be safely
trusted for keeping with the State banks it is clear
and consistent that it ought not TO be collected and
allowed TO subsst in the notes issued by them. What
collect debt in that representation Of money, the
maker of which is unfit to be trusted with its keep
ing for short time What reject, in collecting a
debt that representative of money, the maker of
which may be safely trusted with the keeping of the
amount collected in another kind Of money! The
opponents of State bank agency consistent in re-
sistng it in each respect Whether their consistent
views consist with sound policy, remains for them to
demonstrate if they can. In other words il remains
for the thorough opponents of State bank agency to
answer the objections that have been taken to their
Sub Treasury scheme, which is designed perma-
nently to supersede State bank agency-taken to it
and urged against by the friends of the special de-
posite plan who, nevertheless, manifestly ncon
sistent in this thai they insist upon continued
ceipt of the notes of speciepaying State banks in all
collections Of the revenues while at the same time
they admit that the State banks cannot be safely
trusted with the revenue thus collected on general
deposite; that they can only be safely trusted with
its intermediate keeping on special deposite
This brings again to the inquiry, rrha is meant
by Especial dcpositc?" The definition given in my
las, letter is substantially that given by gifted
friend of the plan, in his Speech just published in
the National Intelligencer, and delivered by the
orator in the Senate of the United States on the
Goth of September, 1887 Mr. Preston's definition is
be that deposie which the bank receives to keep and
no, to use for banking purposes; and to return the
identical thing to the deposition when drawn for" 1t
is evident in this definition of special depo
SITE not to be used for barking purposes that the
ticipated sauary effect of the plan is prevention
by it of over-ac,ion, on the part of the especial"
deposite banks. Prevention Of over-issues IL would
be gripping condition. if suffered at all to have its
legitimate effect What crib Golfer, confine, con-
sign to dleness, for indefinite period until il is
wanted for disbursement the whole amount of bank
notes which the Government may have received in
its vast collections of revenue This to prevent over
issues and to occlude the consequent peril of stop
page of specie payments Why should not ind-
viduals make the like special deposites And would
not Individual depositors and the State governments,
for safety, too be apt follow the example of the
General Government Thus the whole amount of
the paper issues of the deposte banks, il indeed they
iroHld not enlarge their issues 10 0rer-asfcr The en-
barrassmcnt might al times be cribbed, cofiered, con-
fined, consigned TO idleness, awaiting the will of
depositors to release il from inaction, and give its
chartered freedom TO foster industry and stimulate
enterprise, But let il be taken TO be true, that
especial deposte' of the revenue collected and sub
sisting in State bank notes, might not impair the
chartered faculty and freedom of the bank TO employ
its Reasonable notes. and how limited would be the
operation of the plan! Confined 10 the deposite
banks surrounded bya host of other banks, similarly
constituted, and restrained by such {" powerfulr)
check II could exert no control over the issues
from the other Cat least seven hundred) banks.
Truly it is trim device to give stability to the paper
part of the currency of the country, furnished by
eight hundred banks, which, for nearly half cen
fury, have steadily increased yet are increasing in
number, and ought TO be diminished. Reduce; yes,
reduce their number, and irterdic the issue OF small
notes. THIS ropid be an efficient and sufficient
check upon their legazed and constantly stimulated
propensity TO over-aciion-the only efcctual check
within the range Of wise legislation.
PUBLIUS.