The Madisonian. [volume] (Washington City [i.e. Washington, D.C.]) 1837-1845, 1838-05-24

Gordon--the employment Of State Banks in
place Of Receivers and Colectors--and the
receipt notes Of specie paying banks in the
collection Of thepublic revenues. Mr.. Polk,
at that time, was chairman Of the Committee
OF Ways and Means.
Whilst am up, may be well to notice some other
propositions OF amendment which the House have
been notified will be made TO this bill. especially
may not have another opportunity TO address the House
gentleman .lom Virginia [Mr. Gordon,l has signifed
his intention TO move the amendment TO this bill which
he presented and had printed by order OF the House
some days ago. That amendment provides that the
collectors OF the public revenue when the amounts
collected small, "shall be the agents OF the Trea-
suer, to keep and dsburse the same " and that they
shall receive an annual compensation II provides, fur
her, that, at places where the amount collected shall
be large, receivers shall be appointed to be agents Of
the Treasurer, TO keep and dsburse the public
neys and that they shall be paid annual compensa
ton for their services The Secretary OF the Treasury
IN his report has overlooked the description OF per-
sons agency here proposed, but has submitted 10 Con-
gress his views in relation to it, He states that this
KIND OF personal agency is in his opinion TO be avoided
IN oil practicable and safe cases. under present sys
tenn Of selected banks because would render the sys
TEN ess convenient less secure, and more complex, If
not more expensive Unless the
States, aud the United States, should both deem pro-
per gradually and in the end entirely, TO dispense with
the paper system, and which result is not anticipated
the Government cannot escape occasional losses from
that quarter, and never hope 10 escape all losses
from banks fiscal agents, except by the employment
IN their place, Of other and individual agents. who will
probably DO found less responsible, SAFE convenient
economical" He comedies that it would he practical
BILE 10 employ such agents, but docs recommend it,
for the stated in the paragraphs of the report
which have read, and because il would not in the
present condition Of things, be so eligible system
the present one"
Acorpoation may be safer than any individual agent,
however responsible he may be, because it consists Of
association OF individuals who have thrown together their
aggregated wealth. and who bound in their corporate
character TO the extent Of their whole capital stock for
the deposite. In addition to this, the Secretary Of the
Treasury may require heavy collateral security in
addition to their capital paid in, from such a
poratlon, as he could from individual collector
or receiver, which makes the Government deposes
safer in tho hands Of bank than il could be with in
diyidual.
1t may be well questioned whether the heaviest Sc
cuny which the most wealthy individual could give,
could make the public deposte safe at the point Of large
collection. In the city Of New York half the
is collected. Several millions Of public money may be
IN the hands OF receiver at time and il he be
rupt shall engage in speculation trade and meet
with of fortune, the loss sustained by Govern
ment would be inevitable With ample security as it
was supposed, the Government osa million or more in
the tea cases, few years ago. The losses in three
cases alone already stated in 1927 and 1923, when
was supposed ample care had been taken the
debt amounted TO near two millions As, then, between
the responsibility Of public and bank corpora
tons, as banks do exist and likely to exist, under
State authority, the latter upon the ground of safety to
the public, arc to be preferred.
Banks, when they safe, recommend themselves to
the service Of the Treasury for other reasons
l. The increased facility they possess over individual
collectors or receivers, in making transfers of public
money TO distant points for disbursement without charge
to the public. Indeed, this is service which indivi-
duals to the extent Of large revenues, could not
perform
2. It may happen in the Auctuaon of the amount Of
revenue and expenditures, that there will be at some
times considerable surplus in the Treasury; which
though it may be temporary, if it be withdrawn from
ccula,ion and placed in the strong box OF receiver,
the amount Of circulation will be inunously disturbed,
by boarding the deposte, by which the value of every
article Of merchandise and property would be affected
SO that, inasmuch as we cannot anticipate or estimate
what the exact amount Of revenue or expenditure may
be from year to year, there may Of
venue in the Treasury, Immediately called for to be
dsbursed, which it would be very announcement to abb
sract from trade and circulation Whilst the deposite
is IN bank the bank may il, keeping itself at the
same time ready to pay when demanded, and it is not
withdrawn from the general circulation, much
money boarded and withdrawn from the Of the com
munity. ~#
If in the hands Of receivers, they must either hoard
by keeping it locked up in strong box, it at
their risk in private speculation or trade, or they
must for their own security, and their own respon
sibity, place at last dcpose in banks for safe
keeping until they called on by the Government
for it, ..-..
This temporary Of the money on deposite in a
bank constitutes the only compensation which the bank
receives for the risk Of keeping it and for the services
it performs. If receivers be employed they can per-
form no other service than keep the money and must
be paid compensation from the Treasury.
The other provision of the amendment proposed to
be offered by the gentleman from Virginia, which re-
qulres that the public revenue shall be paid /" in the
current coin Of the United States" is unnecessary No
public creditor can now be paid any thing but
coin by any Of the deposte banks, if he demand coin
Nothing but coin. the paper of specepaying banks,
readily convertible into specie, is now received in the
payment OF the public revenue.