The Madisonian. [volume] (Washington City [i.e. Washington, D.C.]) 1837-1845, 1837-12-14

special deposites in any banks either State or Fede
raj, except uncurrent and unavailable funds belong
ing 70 the Government which such banks declined
receiving on general deposite thus TO become liable
for the same. During the existence of a National
Bank, find that State banks were employed by that
bank In places where it had no branches, to collect
the public revenuei and were also employed by the
Treasury Department ITSELF in other places for such
purpose But ] cannot find any instance where a
bank employed in either case, was required to
hold the money thus collected on special deposi,e.
have before me list appended TO the report of the
Secretary of the Treasury made in December, 1884,
OF thu Stale banks which stopped payment between
1877 and 1884 and were indebted tothe Government,
in which find number thai were selected by the
Treasury Department during the years 1918 and
1919 These certainly could not have been special
depositaries
In examining the correspondence between Mr..
Cheves, President of The Bank of the u States and
Mr.. Crawford, then Secretary of The Treasury, in
1919, when the former, apprehended that the State
banks would be compelled 10 suspend specie pay
mens, he suggested TO the latter, the erpedieaey Of
authorizing the Bank of the United States 10 receive
payment of custom house bonds, in the notes of
State banks and holding hem on special depose, on
account the Government. The proposition, how
ever, did not receive much favor, and was never
adopted
Those whoare opposed to the Sub-treasury scheme,
and advocate the special opposite one, have made a
variety Of suggestions TO obviae these objections to
the former. One is to unite with it some Limitation,
about blnk currency which shall not carry with it
the Objectionable features of two currences the bet,
Ter for the Government and the baser for the people
r1p,a e.,Ia .l IL.
Of the extra session, proposes this: That " each
bank shall receive as special deposes all moneys of
the u. States which should be paid into the same,
and the keep special opposite and as specie,
tothe credit of the United States and use or bank
upon the same And that such bank is, "to credit
specie all sums deposited therein TO the credit of
the Treasurer of the United States, except such
other notes or scrip as Congress has or may hereaf-
ter specially direct to BE- received in payment OF the
public Dues not being hank Notes. and to pay all such
deposiles in specie, If repaired By he holder thereof"
A compliance with these acquisitions would be near
ly impracticabc By any bank, for il to under
take to convert iron into gold. Certainly it would
BE- for any consideration which could with propriey
be allowed for the sacrifices which would attend
such an undertaking, as will point out and eluci-
date. a.tl.
ohoulu Dirk nave the TdSnHcss 10 venture on
such undertaking; its first act beforehand would
from necessity be, to provide itself with two vaults
One at the one end of its banking room, having in
scrib,a over it in goldsn letters The Governments
pamA and money" One at the other end of the
same ROOM inscribed on il in ordinary letters " The
Peoples raul and MONEY" II must also provide
distinct set Of books, clerks counters desks &c. &c.
in connection with performing the duties then de-
Il -. -
keep all the money ii may receive, (although it may
all BE- in bank notes. all in treasury notes) specie
special opposite and not to use or bank upon the
same. Now, how is such bank to comply with
these provisions There is one way, and but one
way. That is this-Whenever a sum in bank notes
treasury is brought to the bank to be depo-
sited at the credit of the Treasury specie ii must
on the instant take an equal amount of specie from
its own vault and place in that of the Government,
and substitute in its vault the notes for the spe
Gle thus taken from it; because it is not permitted to
the notes. even for the purpose of converting them
into specie which it is obliged to pay on account of
these notes so deposited the same day that the de-
posile is made, if called for. These the details
attending the only mode in which the proposition
can be carried into execution. apprehend it will
be found 10 embrace difficulties and objections
enough to slagger the most strenuous Of its advo-
Gates. twill establish emphacally two currencies
the be.r for the Government, the baer for the Peo
pie 1t will also Gin the words ofthe Mcssage) fully
accomplish one ofthe objects which recommended
the plan Qhe Sub-treasury) to my Judgments sepa-
ration Of The fiscal concerns of The Government from
those Of individuals or corporations" That plan
however, is altogether impraclicaple. There is not
reputable bank in The country, which either could
or would have any thing to do with the public mo-
neys on such conditions. ~"
Another plan is, that the public revenue shall be
collected in gold and silver, or the notes of specie
paying banks, which the deposite banks will agree
pass to the credit of the Government as cash. and
to be paid away in specie, If called for by the holders
of treasury warrants This would not be special
deposic. II would be general one. 1t is precisely
the proposition embraced in Mr.. Rives' currency
BILL which the President says he considers that both
Houses of Congress negatived, and in which he en-
tirely concurs.
Another plan is, that the collectors and receivers
notes ofspecie paying banks in the inn
mediate vicinity, in payment ofpublic dues and then
draw the specie themselves from the banks which
issued them and place it on special deposi,e in bank
at the credit of the Treasurer Of the United States.
can perceive no possible advantage to bederived
under such process. 1t would, in the first place,
expose the money to risk and danger in the addi-
tional operations which it must perform; and it
finally retains the odious distinction of better
rency for the Government than for the people.
There is still one other plan suggested, which is
this: That the public revenue shall be collected in
specie, in the notes of specie paying banks, and
held special deposes; and the notes of each bank
received, shall be returned TO it and payment de-
manded in specie as often only as once in every
sixty days. This plan is full of objections. II assists
to give circulation, and to keep out for certain
time, an increased amount of bank notes; it will
lead to frequent and sudden expansions and contrac-