Maumee City express. [volume] (Maumee City, Ohio) 1838-184?, 1839-01-19
From the Neao York Express.
THE NEW BANK LAW.

the most important measures ever adopted in
this State. 1t effects great revolution in the
system of banking, in the legislation of the
State, in The uses of credit and capital, and
must exert prodgious influence on the bus-
ness, the improvements ard the general pros
perity ofthe State. Nor is it to be viewed as
a New York measure merely. Its adoption
here, will tend 10 its adoption in other States;
certainly if its practical operation be success
ful and beneficial. Even while writing this,
it is announced that Georgia has adopted it;
and Its principles objects, and defects if any
there be, deserve to be gravely considered and
thoroughly discussed. Before the suspension
Of specie payments, plan was devised, and
its principles developed by gentleman ofthls
city, John Allen, NJ. D. who foresaw the ca
tastrophe, and clearly comprehended the de-
fects and vices of the old system of banking,
for its correction and renovation, on the broad
basis Of safety to the public, and equal rights
to all. These principles were subsequently
incorporated in the new bank law, and simple
as the principles of that law may appear on en-
animation, it will constitute new era In ban
king, not less marked and memorable than
Clinton's Canal Law has proved in relation to
Internal improvements.
The granting ofspecial bank charters by the
Legislature was originally supposed to be a
useful and necessary power-necessary to pre-
vent abuses, and for the public safety and con-
venience. But it implied that the Legislature
could Judge better of the safe, profitable and
useful application OF capital and credit, than the
individuals and communities interested-that
it might deny to some, advantages conceded
to others; and which are the common right OF
all-ard it opened the door, for unp.inclpled
party leaders, great politicians and small, 10
introduce political influence into banks, where
of all Ilaces, it was least wanted and most mis-
chievous. Accordingly bank charters were
almost uniformly granted, by party votes, to
secure or retain or reward political men and
political support; and banks in turn, were too
often used to sustain political objects. Inc
dispensers of the favor, in the mean while, took
good care to remunerate themselves, byreser-
wing large slices of tile stock; and the party,
by placing them under the control Of political
commissioners, did their utmost to make the
control permanent Thus the exercise OF
this Legislation, was productive of demorall-
zatlon and corruption. By the new law, the
machinery of special bank charters is broken
up; that highly useful class of Legislators
the lobby members at Albany, find their 'oc-
cupation gone, and the alliance between banks
and politics is dissolved. The capital and
credit of the State will henceforth be devoted
to sustaining its business without being forced
into channels uncongenial to its nature, and
dangerous to the liberty of the people and the
purity of the Government.
The new law redeems banks and banking
from tie odium of being monopolics, and de-
rves domagogues of their weapons of attack
a against The useful operations ofcapital and Gre
dit, by appealing to the natural jealousy of as
wealth and privilege. In all other
private pursuits and business, individuals deal
without legal restrictions. In banking under
The new law, every note is amply secured by a
und in the possession of the State; and with
his restriction, 1t is open to all who choose,
md have the means to embark in it. 1t will
,ut stopper to the whole clamor about banks
"a clamor which would have ended, on the
passage of new bank law, but for the con
,ulsive throes of dying and desperate Ad-
Banking will be rendered perfectly safe-an
advantage which the old system did not give.
For, with the power to issue notes to three
lines the amount of their capital, and that
,apital in their own possession, the public had
10 other substantial security than the interests
,fthe Institution and the integrity of its drec-
ors. The Safety Fund was little better than
og, and the commissioners did not mend the
natter: thev derived their information from
he bank and it's officers, which was generally
uite satisfactory if the bank was loyal; and
he nature of their duties pre- supposed they
we're to act, after the mischief was done, and
cry gravely to search the stable and shut the
oor, after the horse was removed. Under the
ew law bill holders have the security OF fund
vhlch the association cannot waste or dlVer'. t
With new issues, new security is furnished
onsisting of specie, public stocks at par, and
cal estate, the most solid property that exists.
.he currency, thus furnished, is not only safe,
ut less liable to be counterfeited, and the RCD
acks can be distinguished by glance OF the
We without the assistance OF the Droker.-
ictual property being pledged, it will be the
aterest of the directors and stockholders to
manage their business prudenily; and if in
titutions so conducted become too numerous
, be profitable, some will retire from the field;
he business, like any other, vii! find its level;
nd bank issues will be commensurate wlththe
,ants and business of the State.
A very injurious feature Of The old system is
s exaction of endorsers in all cases, by which
,ousands have been ruined. Itexacted more
scurity from its debtors than 1t gave to the
ublc. The new system is founded on the
edge of substantial property, and its tenden-
' is 10 introduce real transactions and sub
antial property as the basis of loans. Indeed
,tual property is always convertible into
ock, and stock kintoloans.
The new law adopts Real Estate as basis
a gwen extent for bank loans. Why not {
correctly appraised and readily convertible |
to cash? Why not give to that property, {
ore steadily and permanently durable than t
" other, a new faculty, and thus enable far /
ers to enjoy advantages and facilities conce- c
ID to be useful and necessary to merchants
ID mechanics? IN new states, the redundant S