The Madisonian. [volume] (Washington City [i.e. Washington, D.C.]) 1837-1845, 1839-03-30

me more whoiesome operation OF the natural Tegu-
lator. Nov, yon will readily perceive from The
view which have presented Thai Il necessarily tol
lows, thatihe magaitadso the government deposiles,
which most persons think the source oil danger in
me ordinary deposile system Is The very reason why
that system should be preferred either OF the others
IN some respects too the great deposiIors to be
preferred 10 The small ones. The great deposiors
have u 10 their power II they will only manage
Judicinusly, To steady The system. Your linle de-
pn>ilories are always mereiess in a panic The
RoIhSchiiis and The Batiags are the men Ia sustain
the banks in a crisis When ihe Bank OF England
was pressed so hard In 1925 The company OF Rolhs-
chdsd every III ng 10 sustain, while the liiue de-
poSiiors and the lle mole holders were doing every
hing in their power TO break u. Il Il true IL the
government OF the United States should Withdraw
Ills dspos'les inludciou>y, especially during mo-
ney pressure, the evil may be greatly augmented
bat on the other hand BY iudcious management, II
may greatly alleviate IT,. There are some advantages
which government deposites present for banking.
yielded bg no others. They are made with reguari-
~. u ] put len thousand dollars in bank to-day,
Perhaps ON the morrow, may make contract,
which may cause me 10 withdraw the money. But
the withdrawal OF government deposiies may almost
always be forcseen and provided for The money
Is generally appropriated by action OF Congress,
according To prescribed system. Our treasurer OF
the Asylum here; never finds difficulty in making
his payments although The appropriation TO the
Asylum is $4,000 fAnd the reason is he can
ascertain in advance, with some precision, the
amount TO be disbursed by him; and he knows pre-
cisely when he Is 10 receive the appropriation The
truth is, that one fhe greatest advantages OF banks
results from the fact, that they can bring into action
every portion Of the capital Of country. A has
$4,000 which he will use one month hencej he can
make no profit on the money himself in that short
time, but ii he deposites In bank boarding Is pre-
vented, and the country reaps the benefit. Let not
then the government OF The United States, in this
civilized age, this age of credit and commercial
activity, confess itself unable to take care OF its
Cnl "A. at.l. fkan axpht
prevails among barba rians-that Of boarding!
As TO The relative safety OF the funds in the sub
treasury and in the banks, think there can be no
doubt; and even supposing the amount collected 10
be safer in gold and silver than In any other FORM
yet the constant pressures which would ensue would
diminish the revenue infinitely more, by drying up
It's sources, than occasional losses BY bank failures
could do. And after all, what would be the dreadful
consequences of an occasional loss of a few thou
sands, even few millions of the revenue OF the
General Government Such losses night not wiring
tear from widow or an orphan. But adopt plan
which shall keep every bank in the country In eter-
nal jeopardy, and soon you will clothe the land in
mourning.
In addition 10 the arguments which have men
toned il may be affirmed, that this scheme must ne
cessariy lead to government banking Regarding
this fact as among what perhaps, may properly be
termed The p0tentiaLites of the system consider II
among The most formidable objections to il. For ex
ample-suppose the sub treasury in full operation
and you have your depostes Of silver AT severafdif-
ferent points A. goes to the disbursing ofcea for
payment of his salary II he gets a draft on New
York, in consequence OF the exchanges, il MAY be
worth five per centum premium; if on New Orleans
il may BE- al discount OF five per centum. Now
that officer of the Government who determines this
matter, must necessarily have great power over
those who are TO be paid. Here is a great source
opened Of patronage and corruption. Again--when
these drafts are given, II upon convenient point,
they would be greatly preferred by The holders Of
specie. They would not consequently be presented
II not presented, they soon fill the channels Of crcu
lation, and become to all inienls and purposes bank
paper il you suppose this state Of things to last the
subtreasury would realise the fable of the lions dem
the specie might flow in, but would never flow on !;
and such an OF ration of course would break every
bank in this country But we are here met BY the
provision that would be enacted that these drafts
should be presented within certain time, or not
honored Now, to this we say, that the power
that made might easily be tempted to unmakc ;
and so great would be the convenience and pro-
III Of these drafs, compared with specie, that the
Government might, in very few years be tempted
10 give The holder discretion in The matter. The
people themselves would demand il. You would
then have the subreasury banking institution,
conducted on principles similar 10 those upon which
he celebrated hank Of Amsterdam did business
Like as il the case OF that bunk, itmgh soon'be dis
covered, that there would be no likeliho of all The
silver being cal ed n al once; and consequently that
large portion might be loaned OUT, or made way
with by The conductors of the institution.
should even BE- endangered, (and recollect is here
as n mechanics the weakest link in the chain is the
measure Of the strength Of the whole system the
banking system being endangered, credit and conf
dence Of course would fail great contraction would
take place in the circulating medium, bankruptcy
and distress would cover the land-can you doubt,
for one moment, 10 what qrarier the ewes of all
would be turued for relief in such period of Gala
miiyl Most aSsuredly TO yonr sub treasury. Just
at such period its strong boxes might be giutted
W hp prpr inns have h.
lie-blood, the very soul Of the banking system All
that would be wanting would be TO endue it with the
forms and privileges of the system! And does any
one doubt that people, ground into the very dust by
momen'ary pressure, would hesitate for moment
10 confer such privileges, when immediate relief
might be the consequence You might almost as
soon expect the shpwrecked mariner 10 hesitate in
sezing the plank that fortune had thrown in his way,
as 10 suppose that the representatives OF distressed
and suffering community, would pause TO calculate
the remote consequences Of a measure, which would
check Tor the present the overwhelming tide of ma
tional calamity. The experience OF modern times
has shown, but too conclusively, that, in the agony
OF commercial commissions, patriotism, and virtue
will be- sacrificed on the shrine of present interests.
So far have been considering what the people
themselves would be willing to do-what change
they would be likely TO call for in this subtreasury
system have been surprising the Executive all the
time entirely passive. But can we anticipate such
C pntenledness, such inertia? Those who do have
more confidence in the integrity and recude of hui
man nature under strong temptation than have
Mol You may rest assured that sooner or later some
popular executive would breathe the breath of life
into the system You talk Of this and that device to
restrain The executive of this and tina, provision to
make your snbtreasury work according to your an
ticipations Vain delusion. You are but binding
the sleeping Samson with sitkea threads! Your ex-
ecutve win watch for his times and seasons of en-
enactment. He will build up and arm in his own
defence this mighty ally and wo be TO that country
that shall ever witness the contamination of such
monstrous alliance.
Mr.. Calhoun relies upon what he terms the an
tagonstica position of the Stale Banks to the Fede-
raj Government, as the latter should be d.
vorced from the former. But what, let me ask, can
be the value of such anagonism, when you have
drained the banks of their ie.blood Z Enfeebled
and exhausted their struggle will be for mere exist
ence. They will become the crouching slave of the