The Madisonian. [volume] (Washington City [i.e. Washington, D.C.]) 1837-1845, 1838-07-04

call 70 mino events o. the last winter, IN THIS District,
under the eyes Of Congress"
Also in the same paper Of the ID of June 1894 the
following;
THE STATE BAsKs or MOST or THE srATEs, EWING
I'd THEIR PATRIOTISM ny LENDING BEYOND THEIR MEANS
TO SAVE THE SINKING CREDIT or THE Treasury; AND
NOW THE MIsFoRTusEs WHICH THEY ENCOUNTER IN
COMMON WITH THE GOVERNMENT ~ ITS FINANCIAL GRE.
DIT is MADE AN ARGUMENT AGAINST THEM"
Ialso referto the following testimony contained in
speech delivered by the honorable gentleman from
New York Mr. Cambreleng, in which he said
We tried the experiment Of carrying on war withou.
money and Of supporting public credit without taxes,
Our revenue from imports ceased-no tax was imposed
throughout 1912 and lsl3-we issued no Treasury
notes. and negotiated our loans at lower ratcs--WE
BORROWED THE CREDIT OF OUR LOCAL
BANKS AND COMPELLED THEM TO SUS-
PEND THEIR PAYMENTS-eonfdenee pas des-
royed, and panic seemed 10 affect all IN or ot Of he
Government
also refer to speech delivered by the honorable
Speaker Of the House Of Representatives, Mr. Polk,
on the 10Th day of February, 1885, in which, IN refer
ence 10 these identical losses he said
They have stood up against the power Of that inst
tuition, and the effects OF the panic also and have BEEN
SO far, successful The gentleman, (Mr Binney) SAID
that the parallel OF those banks, formerly exist
ing to wit between 1889 and 1916 during which they
constantly employed fiscal agents, did not hold
good because said he, there was then as much specie
in the country now and moreover that the calamity
of their inability at last. Bot the gentlemsns
gumen did thold good: for The country ras then only
just liberated from an f1pensioe irar The cause OF
this failure ought TO be ascrbed TO their having made
their issues large (many OF them he believed from
patriotic motives and were not able 10 meet the sud
den call upon them" have not understood that this
gentleman, has in the slightest degree, changed his
opinion.
also refer TO speech delivered by Mr. Benton,
in the Senate of the United States the I'd OF June
in WI in ref nee n
were computed 10 the banks as an objectionable sin
Mr.. Benton said:
at was true that the federal government had since
lost about million and half Of dollars by State Banks
but that loss took place in season Of universal emba
rassmeut growing OF state Of war, and general
stsgnaiion Of trade and commerce; season which
not be made the rule for Judging State banks, without
extending it to the federal bank also and then it would
be fatal to that bank for the United States lost about
eleven millions of dollars in sustaining the present federal
bank in the season Of embarrassment, and saving
that bank from sharing the general fate of the State
institutions his statement, Mr. b. said, was one OF
those facts which il good to prove, and the proof
was in the documents OF the Senate, he would it,
and exngush once, this deusive and deceptive COM
parson between State banks and the Federal bank
also refer 10 speech Of the honorable Speaker
delivered in the House on the 10th day Of February,
1885, speaking of the safety of the State banks he
says:
In relation to their safety, prevailing Of fact
has through all the discussions, and out Of Con-
gress 1t has been enormously assumed that, whilst
national bank existed, in the interval which elapsed be-
the expiration Of the old and the creation Of the
bank charter, the Government had sustained heavy
losses by the failure Of State banks, holding the public
deposites The arrangement in the currency during
the years 1914 1885, and 1916 aud the embaIassments
which the Treasury and the country suffered during that
period, have been often referred to, The unavoidable
fund in The treasury, created chiefly by the failure of
banks, has been constantly pointed TO- standing
mortal Of their unsaety In the discussions upon this
floor late the last session of Congress- this leading
error prevailed, and upon it based much Of the
argument then urged, which intended to prove the
necessity Of national bank. We were then asked,
Have forgotten the lessons Of Is, 'l6, NJ Are
there not million or two of unavailable funds left
from our last experiment upon the equal value OF state
bank notes (Do not the favored banks already refuse
each others paper Is not the inequality Of exchange
already reappearing" THE loss sustained
by broken banks alone between 1914 and lSla exceeds
milon.") affirm that such loss sustained,
and call upon the advocates of the Bank of the United
States, who constantly reiteate general like
these to produce the evidence OF the fact During the
period which elapsed between the Sd Of March, 1911
and the beginning Of l6l7-durng which no Bank OF the
United States existed, and when State banks were ex
clusiyey employed fiscal agents and public deposi-
toresnot dollar lost the Treasury by the failure
Of banks The whole unavailable fund, now in the
treasury accrued after, and not before the charter of
the present Bank Of the United States was granted and
after that bank was in full operation From official
documents before me, (he supplemental report Of the
Secretary of the Treasury appears that the whole
loss by the failure Of deposite banks between 1914 and
1912 as repositories, amounts 10 only IS $40 o. and
including their bills in possession to less than hundred
thousand, the whole of which occurred in 1877 after
the Bank Of the United States had commenced opera.
tons And though the fact state is verified by official
documents and is incontroyerble, we are constantly
told IN round numbers doubtless for the Of pro-
per examination that the loss sustained by the Treasury
during this period, by the failure of State banks ex-
ceeds million" 1t may be useful in order disabuse
the public mind this subject, inquire how and
where, the unavailable fund now in the treasury ac-
crucd II amounted on the 10th of November last to
Sll57S90 IS. small portion OF this has since been
collected, and additional progress Of colec
ton, portion will be wholly lost"
am not apprzed that the honorable Speaker has
changed his views as to the correctness of this
ment. concur with the Speaker, that the power
which Congress gave the late United States Bank
the State banks, and which exercised with so
much severity, produced the ruin of many of them;
emerging, as they were, from the difficulties Of war,
and the suspension of commerce.
Charge upon the State banks all the losses which
are Justly chargeabe upon them, as repositories,
and yet those sustained by individuals are greatly
beyond them. Weigh the excuses for the losses by
the banks, with the entire want of excuse by indi-
viduals, and there is no comparison. Indeed, the
greater safety of banks results from the very nature
of things. Their officers are checks upon each
DINER; their daily weekly, quarterly, and yearly
settlements and the constant watchfuness of their
directory, all tend to secure against malversaon-
checks which cannot be placed over individual col
| lectorS. 1874.
Mr. Chairman, none OF us can be ignorant Of the
frailties of human nature, and its liability 10 be
duced from the paths of prapriety and recitude by
the strong attraction of irresistible temptations Of
all the passions which infest The human heart,
are stronger than those of avarice. The spirit of
speculation too often misleads the judgment, and
berays the most honest heart into error. The pos
session Of large sums of money, and the prospect of