The Madisonian. [volume] (Washington City [i.e. Washington, D.C.]) 1837-1845, 1838-03-13

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merchants ~ Na'chez or New Orleans, payable in Elk
months, and depending upon the return 81 their crops Ia
pay their bank drafts by these means thew their
plantations with hands, farming utensils and proyisions
ms gWesa spring 70 me planting interest, by which
millions realized The Western States Of Ohio
Kentucky, Indiana and Illinois, want money Of equal
value every where The farmers and graxiers Of these
States yend their supplies in the lower country markets
Il is important that they should receive money which
viii decrease ia value every step they take on their
return to their homes. There they have to pay this
money the merchants who purchase their goods
Eastern cities and il is OF the utmost importance that
the money thus received in New Orleans should
the purpose of the merchant 10 pay for his goods in
New York
In ls34'5, while our banks were in favor with tho
General Government, all went on tremendously. The
PRESIDENT N his Messages and the Secretary Of the
treasury, IN his reports extolng these Institutions
70 Inc skies Tor the ability and fidelity with which they
transmitted and dsbnrsed the public revenue and regu
lated exchanges: the banks we're prosperous and our
country hourshed The banks were encouraged by the
Executive 70 grant commercial facilities they did So
IN some instances, impEudeniy, doubt, but unfor-
tunaely they incurred the dsElsasure Of this Govern
ment, and what followedl Why, sir, the Treasury
order OF the Ith Of july 1886 This order created
alarm for the safety OF the banks the note holders lost
confidence in them rush was made . them for
hard money TO pay for lands and ID lf-deience,
closed their doors and by should they be bam-
cd for so doing. Should the banks open their vaults
and pay specie for their notes in the present unsettled
state of the public mind and of the business Of the
country they might continue for few days, perhaps
weeks when the last dollar would be drained from their
Golfers, and they be compelled close their doors for
EmbHrrassmenis viii occasionally happen in
every country, from which it requires effort al the
people, and wise Legislation to extricate them Z We
were overtaken by similar endorsements coun-
try soon after the last war, from which relev-
ed by the joint efforts OF the General and State Govern
ments operating the currency II will not be denied
that the Bank Of the United States on the very
verge OF ruin IN 1872 in consequence Of the commercial
and fiscal embarrassments OF that day committee
of Congress investigated concerns and by The report
made to the House Of Representatives by Mr. Spencer
Of New York, the oath day Of February 1920 both
the people and their representatives informed of
the condition Of that institution reform in the
management of the bank took place the favor shown
it by the General Government restored 1t to the conf
dence Of the people, and from that period the expra-
ton 0! its charter the paper Of that Institution and Of
the State banks, furnished both safe and convenient
currency, at par every where's from Boston 10 New
Orleans and convertible the will Of the holder, into
specie Western people, who sold their produce IN
New Orleans, received in payment the paper OF the
Bank Of the United States, which at par in all the
western States, and the cities 1t is return to
such times and such currency that | advocate We
must depend the small quantity Of precious
metal that, IN The Of trade with other nations
would fall TO our share fend that is about $75,0000 900
upon the paper issued By the State institutions,
both supply the place of the United States Bank pa
by the General Government their paper will supply the
people Of each State with sound and convenient cur
rency but if the Executive and Congress set their
faces against the State institutions, they will destroy
them.
If the Subreasury bill should become law, you
will first lock up $40 100000 of this public revenue
from circulation secondly by the rejection of bank
paper you will force an unnatural collection OF the
whole amount OF the revenue in hard money. II
goes into your Sub-treasury and cannon be used as
people
the hands Of the public officers. BY thus withdraw
ing from circulation the revenue of the United
States amounting TO foryeight millions, you will SO
diminish the quantity OF currency as to depress the
price of properly and labor to less than onefith its
present value.
The revenue of the United States, amounting to
forty-eght millions of dollars has heretofore been
kept and dsbursed through the agency OF the banks,
and formed no nconsiderable part OF the currency.
The question now 10 be determined is, by whose
agency shall these operations be conducted hereat-
terl The Senator from New York Mr.. WRIGnT)
is for the Sub-treasury; the honorable member from
Virginia (Mr. RvEs) is for the Stale bank system.
l have the most profound respect for the Judgment
and Sagacity Of the gentleman from virginia, but
| cannot place the same unbounded confidence in
the ability of the State banks to regulate exchanges,
both foreign and domestic, that he does, OF the in
tcgrity aud ability Of majority OF them TO redeem
their paper have doubt; but it is contrary TO the
nature OF things to suppose that twenty or thirty
State Institutions each independent OF the other,
acting under different boards of directors consulting
the interests of different stockholders and different
sections Of the country, each possessing principles,
in some measure antagonStical to the others, can,
with the same facility, transmit and dsburSe the
public revenue have done by the late
Bank of the United States Should one of our plan
tiers or farmers, on making sale OF their produce at
New Orleans for hard money, place it in deposiie in
the State Bank Of Louisiana, (or instance) and be
compelled to purchase draft on Charleston or New
York, he would have TO pay premium. The Bank
OF Louisiana would be able to draw DRAFT on any
place within the limits Of that State but it is contra
nv to the nature of things to suppose il would have
funds or credit on which it could draw at Charles
ton Louisville, or Boston, without charging higher
rates of exchange than the Western people formerly
paid when the Bank of the United States existed
The Senator from Virginia thinks there was no
failure in the State Banks TO answer all the purposes
of repositories.
When the question of regulating the deposites of
the public money with the State banks, and Of distr
buting the surplus revenue among the States, was
before the Senate at the first session OF the 2 Con-
gress, opposed the provision for regulating the de-
poses in the State banks. These propositions, how
ever, were connected, and we had TO take that part
Of the bill regulating the deposileS with the State
banks, to getthe distribution part through the Senate
After may fruess attempts, BY The trends Oh dsfi-
button TO separate these propositions, voted, under
duresS, for the bill as il became law. We now
have to determine between the State banks and the
Sub-treaSury, as repositories OF the public money
The former is preferred for two reasons : LIST. The
banks are organized under authority fromthe States;
the people have vested portion OF their capital in
these institutions; they depend on their paper TO
supply them a sound currency the legislation OF
Congress has much influence on the credit OF these
institutions especially in the Western States where
the General Government is the great land-holder.
The Western people, TO use their own language
want land office money money that IS not receiva-
BILE in the land offices is always from hive TO ten per
cent below par. ID. The Sub-treasury is new and
unried and il contempaleS the rejection of bank pa
per il payment for public dues Should this be
adopted, it will diminish the currency destroy al
Il - 4 10 IA.