The Ohio Democrat and Dover advertiser. [volume] (Canal Dover, Ohio) 1839-1840, 1839-12-13


4 A state bank, with branches, owned intirety |
by the state, ard under the control of agents
1 and representatives Of the people, and where
The whole profits on the capital invested would
be paid into the public treasury for the public
1 use. il is claimed by its friends, would COM
mand as much public confidence, and furnish as
sound and as safe circulating medium, as any
system that could be ndoptsd-that it would be
iffee from many objections to which other sys-
Items are obnoxious that itcond not be charg-
ed with being amonopoly, 1ss the stock and
profits would both belong 70 the peopte--that
il would be more regular in its action, und ad-
: here more closely to the legitimate business OF
banking than like institutions owned and cons
ltrolled by individuals. There are objections,
however, to putting this sys.em into operation,
which appear to me too formidable to be over
come, The banking capital Of the state on the
thrt sh day of September last was over ten
millions aud half. state bank to sup, ly the
f place of the present banks would require an e.
dual amount of capital, which would have 10 be
procured BY loan in some shape or other. The
state is now largely in debt and engaged in pub
lie improvements which cannot be abandoned
without losing large amount of money and Ia
bor already expended. The completion ofthese
3 works will swell our actual debt, which we will
be colnnsed to nay es it falls due, to upwards
of fiitcsn millions. Would il then be wise pot~
, icy for the state to adopt system OF banking
(which would increase the debt of the state, say
five O, ten millions? Conld the funds be obtain.
> ed on a loan without extending our credit be-
: yond The limits of prudeneel Or could they be-
y obtained on any terms, or such as would justify
a the state in taking theml These are questions,
, in my Judgment, worthy the serious consldera"
. ton of those who advocate the creation OF
: state bank. II would be difficult to keep such an
Q institution entirely free from political influence:
q and party conflicts. It is greatly to be feared
that it would partake Of the political impulses
of the party III power, which would entrely
destroy it's usefulness as banking institution,
y and bring into the political field corruptns
moneyed influence, hostile to the genius Of our
y free institutions. The same objections, but mol
10 tn the same extend apply to state bank, where
ia ,be stock is in part owned by the state and in
:. part by individuals. No peculiar advantage OF
s. benefit belongs 10 state bank where the stock
10 ia principally owned by individuals, which
lr would consequently give them the management
O and control of it. The policy Of mixing the
:. funds of the state with the funds of indlyidualI
- in any enterprise, consider questionable. II
. any loss is sustained it will generally be made
Id to fall on the state I am aware that in severa
m os the states This system has been adopted, ane
!. has to great extent the confidence Of the peo
~ ple, But when we come 10 examine il, we viii
ch find il liable to all, or nearly all the objectlon
o. that can be urged against system of indepen
or dent banks properly limited and restrained. |
would seem to me we would gain but little b.
~ this system of banking while if we adopt il. w
'lt would be forced to increase the debt OF tn
he state in some shape or other, to considerabl
cd extent.
~ The system offree banking is, com
:, pariiively Of recent origin 10 this cOun.
= try, and may be viewed in the light o
:" an experiment. Whether il will an
=, swer the purposes, and fulfil the expec
90 rations ofits friends, 10 doubtfN. Th'
= objection 10 it as system calculated Il
10 furnish aound and steady currency, il
IN the unbounded field il would open to pa.
. per issues Requiring bankers to pa,
D. their notes on demand in specie is no
N an effectual check against over issues
Bank paper is easily made, and th'
n temptation to put an undue proportion II
20 =, circulation is occaioDally great. !
Is will not do 10 trust entirely to the com
4 mereIaI law ofsupply and demand Il
10 regulate the amount of paper circulation
" The demand for money, or that which
10 passes for money, is as unbouBded az
/. The avarlce OF man. Too much papel
is money Is more injurious in its ultimate
70 effects on the community, than too HI
= lie. | should consider any system o.
n banking radically defective, which die
d not regulate the issues Of The banks. ant
:. the amount Of paper which they couc
:. put in circulation by some fixed rule
i ln state bank, ora system of inde.
}, Ipent banks, the amount OF bank capita
= can be fixed by law and made 10 CORES
: Ipond With the wants of the community
d and the amount ofpaper which they may
r out in circulation can be limited by
10 their charters, and regulated by the a.
r mount of specie IN their vaults. This
=, cannot be done IN any system OF Tree
to banking which has come under my OBJ
-4rva,,on, without destroying it's dIsllnc
s. character. We have seen in The state
:" Of New York, wheTs this system ha:
D. been recently introduced, banks organ
s. ized unGer it, one year having an ag'
of gregate amount of incorporated capita
of four hundred millions: In the STATE
ofl Of Michigan the same sys,em has beef
id tried aud failed. The difficulty ofpro
N curing state stocks and converting
=, y them into money when required and th
o, Of uncertainty Of raising money by the sal
lie of lands, morlguged, constitute objec'
os tons to the adoplion:of this system L
vs. Ohio worthy of consideration How
10 10 ever plausible in theory it may aPpea
.fe | doubt whether it is the best mean
er that can be adopted to secure the en-
'le IN view.-a currency Of uniformity an
- steadiness ofvaluc.
il il A system Of independent banks prop
Nv srlv restricted and limited in their pow