The Madisonian. [volume] (Washington City [i.e. Washington, D.C.]) 1837-1845, 1837-11-03

business oil the country is carried on Ii
consists entirely from one end Of the con-
federacy to the other, of irredeemable bank
paper-eyery payment that is made, every
debt that is collected, every transaction Of
every kind, whetherlarge or small, into which
money enters, is carried on and effected by
paper that has been issued by the State banks.
and which they no longer redeem with gold
or silver. These metals have passed entirely
out OF circulation: they form no longer any
portion Of the money Of the community treat
ing money as that only, which, for the time
being, serves as the symbol Of exchange, of
things having merchantable value.
This condition of the currency is the true
and great evil Of the times /; it affects the peo-
pie IN their business, precisely and in the
same manner, as it affects the government in
the conduct of its affairs; and there can be
no remedy, at all adequate TO relieve the GO
vernment from its embarassments, which
shall not, at the same time, and to the same
extent, relieve the people from theirs.
In considering this subject as propose to
do, 1t is unnecessary to 60 at large into an
examination Of the causes which have ope-
rated to bring about this state of things. l
do not know that | am, nor do at all profess
to be, equal to this duty. And yet were to
attempt it, should certainly differ very wide
ly from those who trace these causes no
farther than to redundant issue Of bank
paper. That each issue has been to a great ex-
tent auxiliary to the present endorsements,
there can be no doubt. But it has been auxilia-
ry only and freely admit, that in my very
humble judgment, well founded objection to
our banking system lies in this very thing: that
banks of discount, organized as our American
banks are, yield the facilities Of credit too
readily and amply TO the demands of trade,
without power of discrimination between
such as arise from the extension, or accident
al vigor of heallhful commerce, and such as
have their origin in wild and tambling spirit
of speculation.
Commerce requires credit. From the day
that men passed in their dealings beyond the
first simple stages of barter, credit, in some
form, entered into the affairs Of trade. Its
agency soon came to be understood, and the
winds are not more active in circulating the
common air, than credit now is, all over the
world, in circulating through every land, the
productions of every soil.
Trade and commerce then becoming drunk
with prosperity, have drawn too lavishly upon
the credit offered them through the banks--or
if you will have it otherwise expressed, the
expansible character of bank credit has Offer
ed too great temptations TO commercial enter
prise, and we are now suffering under the con-
sequences Of over action, as well on the part
of those, who used this credit, as Of those who
gave it. >".
In this reasoning, am borne out by the
message of the Prcsident-He says: !" that
our present condition is chiefly to be attribu-
table to over action in all the departments of
business an over action deriving, perhaps,its
first impulses from antecedent causes, but sti-
INFLATED to its destructive consequences by ex-
cessive issues of bank paper, and by other ia
cilities for the acquisition and enlargement OF
credit"
have entered into the subject thus far, only
that may invite you to more enlarged view
of the difficulties to be met, than are presented
when our inquiry is confined simply to con-
sideration of the safest custody that we can
provide for that portion of the peoples money
which is to pass into the public Golfers.
My great objections to the measures pro-
posed in this bill are, that they are not at all
commensurate with the exigencies of the
times. fhev do not meet the real difficulty.
The bill simply ordains that the Government,
after limited time, will receive nothing but
gold and silver in payment Of public dues, and
will entrust its keeping to its own officers
alone. Now. if there were creative powerin
our law if by this simple enactment the bank
paper could be driven out of circulation, back
whence it came, and the precious metals SUBJ
stituted in sufficient quantities TO meet the
wants of society, as well as the demands OF
the revenue, the chief ground Of my oppose
ton would be at once removed. can well
see, from the experience we have had, of the
evil tendencies of the banks 10 excessive is
sues, (and such, at present, are my decided
impressions,) that whenever the currency is
placed in condition 10 bear the tribute, the
true policy of government may be found to be
to exact its dues altogether in coin and to
withhold its revenue while resting between its
collection and its disbursement, from the use
of the banks, as fund to increase their dis
counts My reasons for this will give here
after, when treating of the proper position
which the Government may ultimately assume
toward the State Banks.
The bill is to operate upon the currency as
IL non is, for we have not only no guarantee
that it will be found in an improved condition
at the end oftwelve months 1.-THE limited tme),
but it is susceptible almost Of demonstration.
that one necessary consequence from the pro-
posed law, will be to continue the currency in
its present debased condition.
The precious metals, all will agree, are now
banished from circulation. They are in the
country, grant you, and in sufficient quanti-
ties, perhaps, to answer their accustomed du-
ty of circulating in those channels, below the
reach of bank paper. But they no longer pass
from hand to hand as a medium of exchange.
Their former exchangeable value has been
converted by the course Of trade to which |
have alluded, 10 value exclusively marketable