The Madisonian. [volume] (Washington City [i.e. Washington, D.C.]) 1837-1845, 1838-02-17

public money. II Il is singular iact,' says
the Secretary, " in praise OF this description
of public debtors, the selected banks, that there
| is mol now due on deposiles, from the whole
OF them which have now stopped payment,
! from the establishment OF the Constitution TO
! the present moment, sum much btyOnd
/ rhat IS noW due 10 he United SUITES from one
n,erc0ntiis FIRM hhat sfoPped payment an 1928
4 or 1926 aud OF whom ample security was re-
qnred and supposed TO be taken under the
responsibility Of an oath. Ii we include The
whole present dues TO the government from
discredited banks, al all Zines and Of all kinds,
whether as GepoSifories or not and embrace
even counterfeit bills and every other species
Of unavailable funds in the Treasury, they
piH moi erceed Whdt is due from trO such
| frms." lie then continues 8 II our former
small losses by them, (the banks in keeping
and paying over the public revenue, under cir
+. cumStanccs 50 cary ddoerse, are compared with
! our large losses either IA cOqecttag or dis5us-
ing ti4t repeRue, their present safety seems TO
/ be as great as is consistent with the usual
operations Of the paper system, or with the
4 credit which must always he entrusted by
government, in some way or other. 10 agents,
Of some kind in keeping tho public money.
In considering their safety, it should be con-
| slanty recolected that the owners and mana
gers Of banks, when properly regulated by
| legislative provisions in their charters. are,
| like other individuals, interested 10 transact
\ business securely; are DESTROYS OF making
\ and not losing money; and that these cir
4 cnmstances, with the preference, IN case OF
\ failure. belonging to depositors and holders OF
their bills over the stockholders, united with
the security, if not priority, given to the go
vernment, render them, III point Of safety, ge-
nerally much superior 10 individual agents 81
The United States"
Ifthere be my fact, incontestibly establish
ed in our history, and by the experience OF
all other governments, il is the superior safety
of banks as repositories over any individual
custody. The reason Of it is obvious. The
more complex organ cation OF banks. the num-
Der of their officers acting as mutual checks
on each other, the daily supervision 10 which
they are subjected, their forms of doing bus-
ness, all, furnish securities, which can never
be had in case of the isolated possession OF
money By an Individual, whatever response
hilities he may be bound by. And if a loss
Of the moneys committed to them should oc-
cur either by accident, fraud, or violence, the
capital Of the bank stands pledged for the Sc
curly of the depositor This is, after all, the
Only kind Of security that can be relied on with
1 confidence. If any gentleman will take the
/ trouble to read the notes and remarks an
nexed to the various cases of default, present
ed in the document from the House of Repre-
sentatiyes to which have referred, he will
see how utterly worthless and lusory is the
personal security on which we have hereto
Y 4. 81. III III
has been obtained from suretes, to make good
the default Of their principal, are like angels
visits few and far between" The gener-
al return is, !" the securities insolvent," con-
vcyed away their property mot found"
residences not KNOWN" or some other equal
I ly unavailable return.
In England and France, as well as here,
this species of security has been found either
nominal or mischievous; and in France il has
for many years, been wholly given up. The
only kind of security, that is recognized there,
is like that which the banks give in the re-
sponsbili;y Of their stock. Every person who
receives an appointment, connected with the
collection or disbui sement of the revenue, is
required before he enters on the duties ofhs
office, to deposite with the government, as
] security, an amount Of money, p!oportioned
to the probable amount of the pubic treasure
that will pass through his HAMS. This mo-
ney is held by the government as guarantee
for the faithful administration OF the trust con-
lerred, and forms, at the same time, part OF
its financial resources on which it pays an in
terest of per cent. till restored to the officer
ON his satisfactorily Acquiring himself ct his
responsibilities, or ill it be otherwise forfeited
by his default. The moneys thus deposited
with the government, by public officers, as
qua; antics Tor the faithful performance of their
duties, are denominatcd CautionEemens, and
amount to very large sum. happen to
have in my possession, the report made by the
French Minister Of Finance, Count Chabroi,
to the king in March 1880, from which it ap-
pears that the CdufioanemeRs ON the lst day of
January Of that year amounted to the enor-
nous sum of frs226 4S3 ,973 Uwo hundred and
twenty-six millions, four hundred and eighty
three thousand, nine hundred and seventy
| three irancs,) at time when the whole reve-
nue. of the kingdom did not exceed trs900,-
100000, (nine hundred millions of irancs.)
| Now, sir, if gentlemen mean to introduce
here the system of individual depositaries oil
the public moneys, let them be warned by the
experience Of the country from which they
borrow that system that it can be made safe
only by the precautionary device of Caution
nemcns the effect of which would be TO give
to the mMionuires Of our cities the monopoly
Of all fiscal employments.
But, sir, great as is the danger Of heavy pc
cuniary losses to the government under this
system, regard even that as rile compared
with the extensive dcmoralizationit would pro-
dnce in the country by the temptation held
out to peculation, TO private cupidty, 10 poltl-
| - ~ l., r,n cup,s nf pnhlir pa-