The Madisonian. [volume] (Washington City [i.e. Washington, D.C.]) 1837-1845, 1838-01-30

The Planters Bank located in the same place, lnree
fourths Of which belonged 10 the Stale' WIN iou'
millions Of capital was capable, unaer 'he
lions ~ ,ha act ~ hold all that now held by both
rhr.. .a,,onaI hanks were selected in Boston, with
an aooregate eaptal of about million, for the puF-
nose ~ holding The surplus beyond what those then
existing coud hold when the application OF another
Rank with nearly two millions capital was refused.
One ~ those the Franklin Bank, with capital Of
@I50O0o 4 now reported defaulteri andthe only
one az ali The selected banks against which suit has
bsen commenced. A bank, about the same time,
with capital Of 100000 dollars, was selected In
Charleslown Mass, with no other pretca that lever
heard but because would bea eoareaieRee In pay
ing the men employed al the Navy Yard there. Four
new Banks were appointed in Maine, each with ca
piias OF 100000; trio of which were in the town OF
Bangor Five additional banks We're selected in
New Hampshire, with an aggregate capital OF $780,
Oo0 To all these banks, funds TO the exienttowhch
they could hold under the act was transferred from
Boston And, what is not liule remarkable in
thess cases. is the fact that the funds transferred TO
the binks from Boston, would have been at any time
more valuableto the States than funds in the charge
of the banks within these States. In Vermont an
additional bank was selected with $500 capital.
In Connecticut an additional bank was selected. In
York twelve additional banks were selected one Of
which failed before the general suspension Among
those was one at Brooklyn, with $20Q000 capital,
which II is said was selected under the preter that,
like The one at Charlcsown would be CONVENIENCE
in paving the men employed at the Navy Yard. But
thai which is farther stated shows the utter impolicy
of the selection for the purpose represented. Il IS
said that not single discussing officer could be in
wit 4
made complaints and Obtained from the proper quar-
ter an imperative order to that effect. In New Jer-
sey three banks were appointed where not one had
previously existed and in which but one was requir
ed under the act In Delaware two were selected
where but one was required, and where none had
previously existed. In South Carolina an additional
one was selected uncaed for under the act; in Geor
gia one also uncalled for. In Tennessee one also
under like circumstances. In Kentucky two banks
were selected, one with numerous branches In Ohio
FIVE additional banks selected the latter as late
as Dec 1886, with capital of less than 100000
There we're some other new selections made, to
which have not referred. The whole number were
increased from thirty-six to eighty-nine.
With the selection of new banks, commenced the
orders for transferring the public moneys from one
section of the Union to another, which, in short
time, reached many millions, which were thus placed
in motion Nearly the whole of the newly selected
banks, found il necessary TO reinforce themselves
with specie This they generally drew from the old
deposite banks, on Government warrants present
ing the singular spectacle Of system at war with
itself What with the large transfers ordered; the
short time allowed within which TO make them, and
the effects consequent on such measures by the
month Of November the strongest banks in the coun
try were compelled to call for quarter. Whenever
that was yielded, dread of assuming responsibility
operated so powerfully, that il was of so restricted
character 10 afford but trfiing and temporary re-
lief Things under the operation Of those measures
continued to grow worse, until they ended in the ca
tastrophe Of May last =.
All the banks SO iniudiciously, and, as contend,
in majority of cases, unnecessarily selected, were
required under the act of Congress to pay interest
on threefourths of the money transferred to them
They were obliged, therefore, TO find borrowers
The operation of that act was such, that soon after
the money was loaned out, the banks were obliged
to Gallon the borrowers to refund it, Ithus became
an evil to the banks, and curse to the borrowers
Under all these circumstances do not hesitate to
express my firm conviction, that it is owing to the
ndiscreet measures adopted, and downright misniaa-
agemeat Of the public finances, that all The evils in
the monetary affairs throughout the country TO be
attributed.
The Secretary of the Treasury appeared, either
not to have been aware, or to have overlooked,
that which ought, in my opinion to have been kept
constantly in view that the character ofthe Govern
ment was dependent, in some degree the standing
and prudent management of the banks with which
it thus became connected as its agents
The aim of the Secretary appears TO have been the
equalization OF nearly forty millions of dollars by
placing in each state the portion they would be emit
tied to under the distribution act before the pc
Rod when the first installment was required to be
paid. Sach plan, which evidently was attempted
but failed in being accomplished, was enough Gas it
did in the effort made to convulse the affairs Of the
whole country.
The Secretary and his friends may endeavor TO
justify his course under the supplemental act Of July
1886. lean discover nothing whatever in ii, which
called for such equalization nor do believe such
was the object of the mover. The gigantic project
of equalizing nearly forty millions Of the various
STATES of the Union, in the space Of six months,
may b, said to BE- without precedent in any coun-
try 1t is one which any one ambitious of acqur-
ing distinction and fame might well aspire to accom-
plish proridd self alone entered into consideration,
regardless Of the consequences to the country and its
institutions.
1t is proverb which, imagine, few can be found
who will not assent to- that those 1rho hare injured as
The most, found forcrcr afterwards our most bitter
enemies.
After the universal suspension Of specie payments
by the Banks, in which all the deposte banks were
included, holding more than thirty millions Of the
public money, il would seem to have been sound
policy founded on both reason and wisdom, for the
Treasury Department to have pursued "a course to
sustain the credit and character Of its fiscal agents.