Richmond enquirer. [volume] (Richmond, Va.) 1815-1867, 1838-06-19
Twentv.fiflh COnsress---2d Sess.

RErORr ON MR.. " EbSi Eh hE SS io1''
In SENATE, Friday, June g. 1883
Mr. W,ght from the Committee on Finance, made
the following repori;- -.
The Committee on Finance 10 which was referred the
resolution Of the Senate of the 3lst ult, directing ce!
tain inquiries as TO various provisions OF an act en
tied "An &C, to regulate the deposnes OF ane puoil'
money! passed on the 2d day Of June, 1886, respect
fully report:
The resolution insrucfs the committee "to take into
the act of the 23d Of June 1885, entitled
An act regulate the depnsiIes OF the public money
and to make inquiry upon these points, VIZ:
1st .Whether according to the provisions OF mat
act il is now competent for the Secretary Of the lrea-
,ury TO employ any bank which has heretofore been Sc
lecied as public depository, and which, since Inc pass
age of the act, has suspended specie pay mens'
The committee have examined The act with attention,
and find lba, all other objections being obviated, it is
competent for the Secretary OF the Treasury 10 employ
as a public depository any bank winch has heretofore
been selected for that service and which since tne pas
ssoe of that act has suspended specie payments. The
eighth section of the depose act prohibits the Secretary
Of the Treasury from disseminating any deposte bank
and from Withdrawing the public money therefrom ex
cept for certain enumerated causes: one OF winch is III
the following words:
cor if any Of said banks shall any tune, refuse TO
pay its notes in specie, if demanded
Upon this being presented, it is made the ex.
press duty of the Secretary the same section OF the
act, "to discontinue any such bank depository, and
Withdraw from it the public moneys which /! may hold
on deposte at the time OF such dlsconlInuance; but
when the bank shall have again resumed specie
nothing found in this language 10 lntedct Its re cleo.
ton as place of depository.
The fourth section Of the act sets out the terms and
conditions upon which the banks shall agree to receive
the public moneys before they sha be employed de-
positoes The second OF these terms is prescribed IN
the following words:
Cd To credit as specie all sums deposited therein 10
the credit of the Treasurer of the u and to pay all
checks drafts drawn such deposlies, in
SPECIE if required by the holder thereof.
MI g ~. 81 rkNFt hoh
would be refusal paw deposi,ors in specie and
seeueniy suspension, to that extent. of specie pay
rnents and the duty OF the Secretary of the Treasury
TO discontinue il, as depository, and to withdraw the
public money from IT, would become imperative, BY the
language Of The Sth section, before referred which
assigns another cause Of dscontnuance and with
drawal that any time Of said banks shall fail
refuse TO perform n said duties prescribed by this
act and stipulated to be performed by its contract"
This contingency, therefore, like the former, would
take from the bank it's character depository, for the
time being; would forfeit the existing contract and
der its dscon,inuance and the withdrawal Of the public
money from il, mperous duty but the committee
see nothing in either Of the causes TO prevent second
Contract with the same bank, when 1t should again re.
sumo specie payments again consent TO pay It's own
notes specie, if demanded, and again pay all checks
warrants or drafts. drawn on The public deposlles, IN
specie it required by the holder thereof They IND nc
provision any other part OF the act, lnteIdctng
second contract with the same bank, when the r' shall
have been terminated for either OF these causes and lhey
therefore express their opnion that 1t is now compe
tent the Secretary OF the Treasury to employ any
bank which has heretofore been selected public de
posiloy and which, since The passage OF mat ACT has
suspended specie payments; there being no obstacle
in the way OF such second employment, than the act OF
suspension Of specie payments.
The next point to which the resolution directs the in
ouiry Of the committee, is in the following words:
I'd "Or which has. since the Ain day Of July, 1886
paid out notes, bills, Of less denomination than
FIVE dollars"
To cause the inquiry to be clearly understood, it is
necessary to connect The preceding language with The
words qaoled and the inquiry will be- nhshsr ae
eordiag 10 the provisions Of that act 1.-THE deposte law u"
1886 IL is nc1r competent for The Secretary he Trea
surv 10 .mpy any hank .ohieh has, since The I day d
Juy 1886 pad out notes, or bs If less denomination
than fire dollars
In answer to this inquiry, the committee find the
first clauses of the fifth section OF the be in the
following words:
"SEc. 5. find DC it further enacted, That no bank
shall be selected, continued place of depose OF
the public money, which shall not redeem its and
bills demand in SPECIE shall any bank be select
ed continued, aforesaid, which shall after the 4h
day of July in the year thousand eight hundred and
thirty SIX issue or pay out, any note bill Of less
denomination than FIVE dollars
The last Of these clauses and the nqui
~ directly and shows that il is not competent for tn,
Secretary Of the Treasury, under this act, EN-
o,oy as public depository any bank which has, since
the fourth day of july 1885, either issued or paid GU,
notes or bills Of less denomination than FIVE dollars;
while the frat clause nterdc,s the selection Of confirm
ance at any time, and under any circumstances any
bank (which shall not redeem It's notes and bills, on de
mand in specie
These two points of the inquiry seem TO the commit
tee TO assume the expeaency of of legislation
which shall revive and introduce again into practice the
depose system established By the act Of 1886, the
system upon which the public money is to be kept and
discussed. Under this supposon, the opinion of the
committee TO the first inquiry. does indicate the
necessity OF further legslation while the plain and un
questioned construction OF the act TO the second
htNh iha nf
the raintroducoR Of that system, may poin, out
such a necessity.
No, 80 with the majority Of the committee While left
by the Senate to the free exercise Of their opinions
they cannot recommend any legislation the effect Of
which will he to unite the public Treasury and the
banks by return Of the public TO the use OF
banking; to stimulate and compel the banks discount
spo public money, by e1ac,ng from them interest
for its use TO promote expansion in the paper issues
of the banks, exactly propor,oned to the fertility of the
public revenues, and correspondent embarrassment of
the public Treasury, when serilty Of revenue shall
call for the public money which has passed into the
hands Of the customers OF the banks Such, they be.
eve have been the effects OF the system of depostes
the revival of which the resolution contemplate
That system compelled the deposte Of all the public mo-
ney banks placed il in those nsttaoas upon re.
neral depose aud thus made it, in fact and in law The
money Of the banks, and not the money of the people
il not only held out nducement to the banks 10 use
the money for the purposes Of discount and 6snar but
in this way gave them the right to it, in defiance
OF the popular w and Of the public ashorities went
further, and compelled them to to some profit
able employment by demanding interest from them while
il was in their keeping. Time and experience have
shown the consequences Of such policy and were
there other reason these consequences would forbid
the committee from recommending any legislation calcu
lated, OF Intended to revive that system.
The action of the Senate, however, appears to them
eap,By TO stand in the way of any such recommends
,;an. special convocation of Congress 10 September
i,st was sec.ssty imposed BY The failure of this sys
tenn of depos,es and the embarassmen,so of the public
Treasury thereby occssianed, Recommendations for
the keeping and management Of the public money,
v;thou, the aid Of the banks, and especially for per-
m.oent separation between the treasure Of the PEG.
ole and the business of banking, were then laid be-