Richmond enquirer. [volume] (Richmond, Va.) 1815-1867, 1838-03-10
COngress.---2d sess
REPORT

Twemty-fiftla COnsress.---2d sess.
REPORT
ON TIE ICY SAgSA sHT TEA AN
In Tie House of Representatives., starch 9Th, ls3s-.M
Cambrelens, fron The Committee Of Hays and Means,
nrads the tolo,oiag reports
The Committee of WAYS and Means to whom were re.
ferred various memorials relating the Currency and
National Bank, aud the report Of the Secretary OF
the Treasury the Finances, recommending iuft!ier
provisions for the collection safe keeping transfer and
disbursement Of the public money, suodt The follow
ing report:
The suspension Of specie payments by the banks
throughout the United States, in May last compelled the
Secretary of the Treasury, in obedience to the Cons
tuition and existing laws, TO dispense with Their agency
and the use Of their notes. aud employ The officers Of
Government as The fiscal agents OF his Department.
The bsnks refused pay the large surplus deposited with
them in The only medium authoz7d by ld", aud The eS
prnd,tures Of Government would have been generally
suspended, had The public creditors consented 10 re-
ceve their dues in drafts upon banks which paid them
only ia irredeenabse notes
Under such extraordinary circumstances, it became
obviously necessary devise mode Of managing
our finances which would prevent similar embarIass-
mens in future. The President, accordingly, in dis.
charging his constitutional duty, recommended ut the
late session. series OF measures calculated, as your
committee believe, to give stability 10 the operations OF
the Treasury aud the time, 10 relieve The trade
and banks Of the country from a connection mutually
disadvan,agenus to them and tn Government.
These recomme ds,I'us were opposed By the friends
of National Bank and by others who desired 10 renew
our fiscal relations With The State Banks II was, how.
ever admitted that there prospect OF the esiab
shnen Of national institution TOR sone years to come
il ever; and The expulsion Of the Stale Bank dspose
system recent 10 warrant the expectation OF its
renewal at an early period, if al all. Notwithstanding
however the condition OF finances, and the urgent
necessity Of regulation t" render our Treasury
dependent Of banks, and provide additional guards for
Che safe keeping Of the public money the Treasury
left
tinns again recommended by The President; aud
thing has, the mean ne occurred 10 induce the com
mtee to change their opinion, that their adoption mol
only Essential to the safety and pendence Of the pub
lie Treasury, but 10 The s;ub!iy OF trade and Of every
sound bunk in the Union.
The events Of the last three years have produced
general conviction that the public money should not De
EMPLOYED by banks any other Institutions in
ca discounts however profitable its might be their
Stockholders. During the specu!atons OF 1888 and
1885, the depose banks stimulated speculation 10 ex.
cess and in 1887 suddenly Withdrew their acconm"da
tons meet The public demands The accumulation
and distribution Of the eurplus were among the mns
powerful of that alarm which produced lhs sus
pension of specie payment When banks thus employ
The public money, they deal in fund over which they
have no control, and It's constant transfers and tuclua
TONS e,nbarIass their commercial operations Even
Government itself cannot regulate is amount, antici
nate its fluctuations the demands upon The Treasury
Under any system Of revenue The Transactions OF Go
vernmept would embnrrass trade wherever they are
united But in this country, the connection Is particu
larly DISASTROUS owing to the extraordinary fluctuations
in our revenue. Our income is derived from customs
and public lands and is violently affected by The rapio
growth Of our wealth, commerce, and population. Un
der our revenue laws they have heretofore existed
we have repeatedly had large surplus nj one moment
and Immediately after a bankrupt Treasury. By renew
ing the connection with banks we sal make the public
revenue again Instrumental in exciting speculation, EN-
barrassng trade, and nurng every class of the com
munty.
Il is wholly immalerial whether the public money il
employed in trade by State National Bank agents.
The public must in either suffer from the auctua
tions Of our income and the occasional efforts OF the
Banks the Treasury demands for transfer or dis
bursement Had the Bank OF the U. $ been continued
as the agent of Government, and been called upon,
the Deposite Banks were, repay S37 100000 in nine
months the shock to trade would have been more vio
lent and the suspension specie payments would have
occurred at an earlier period The operations OF any
great institution whether State National with
sve branches, and dealing largely in exchange, mus
convulse the trade of every country where it exists
der The authority Of Government, and The currency
ss,s chiefly Of bank notes Its alarms and its enrt.
will be in proportion TO the extent of it's respons.
h;ltes-and in every revuson of trade, its opera
tions will be watched with apprehension. The mag
nitude Of its transactions gives it the character Of
Government-and its expansions and con,raclinns
like the aucuating revenues OF the public Treasu
~, violently the whole trade Of The country al
ternalely forward AMI backward, leaving at every
vusion distressing scenes of poverty and bankruptcy
The trade of country can ever be we'll regulated when
constantly liable be disturbed either by The operations
of Government, of grea. and extended bank whe
Their State or National Wherever the heavy iransac
tons of both are united, trade be subject re
ouent alarms and revusons. IL commercial credit did
not depend the public revenue, and great bank
vainly attempting to regulate currency und exchanges
existed of the greatest causes of panics would be
removed These would not often occur if trade were
left 10 its own resources the exclusive and undstnb
ed of its capital and credit and il enjoyed the
liberty 10 create and manage its own banking agents
without requiring that they should be clothed with legis
iative privileges. armed with the powers Of Govern.
ment. Revusons might still occur, but they would be
less frequent and violent and should at least
witness the extraordinary spectacle Of aboripg popua
ton without employment, in country enjoying unex.
ampled prosperity.
Such an agency is not only injurious trade but nm
Just TO other banking institutions By collecting the
public revenue, whether in specie in bank notes. all
other banks are directly indirectly made tributary
the Treasury agents Their specie is either drawn from
them or balances created which compel them 10
upon their debtor banks while the depoSle banks
paying The public disbursements in their no.es-
Such undue advantages should be given 10 no banks
pecially when The system is otherwise injurious to
trade and 10 the Treasury.
The proposed separation essential to the steady and
Independent ocon of trade, banks, and Government.
The finances of tho latter must become embarrassed