Lynchburg Virginian. [volume] (Lynchburg [Va.]) 1829-185?, 1839-04-25

= '"N w NV h'u states, on Tie SUBJECT nj lt
ene-feasury. The letter, we deem IT proper to say,
was not written with the remotest view to pubIicn.
ton. 1t is dated
FKpRuARY Q, 1898.
Dear SIR: Yours Of the Ath instant, vas duly re.
ceived. | feel highly battered by the terms in wLicb
YOU have asked my opinion on a subject which
CONSIDER OF vital Importance, and which has alrea-
ny engaged so much of the attention of onr mos,
distinguished statesmen. Upon the great ptinciul,
upon which thai subject must be settled ,c,.e
with yourself aud Mr.. Riyes. consider villa, ia
called the sub-tfeasnIy scheme as Taught with the
most formidable evils. consider it most decidedly
al war with the civilization of the age IN which we
iise-as threatening the overthrow of thai p,,a, sys
TEN oil credit, which Is one of the characiens,ng feo-
lures OF the nineteentl, century. 1t seems to me to
oe d ihost decided movement backwards towards the
ages OF barbarism. look at This question with the
more sollcitude, because know that the people.
whose votes will ultimately decide the matter, arc pc.
eui'afly liable TO take wrong views of the whole sub
jeet. Ihe great mass of mankind Judge by appear
ahces; and the sagacious remark of David Hume
IL surety true, that there IS no subject IN the world
IN winch INST appearances are oltener false, than IN
poi''ica' economy. 1t will be a long time before
the people will be iam,liarly acquainted with the
S'e'' supIeci oil credit; aud until they are, they will
be liable to many abuses The system of credit.
WITH ITS manifold advantages, is liable nevertheless
10 occasional commercial revulsions winch ever pro
duce the most profound distress. These reyulsiops.
u =" dttt now rare, StfikG Inc itnaplnaIIonS of men.
anu are regarded by the unreilecting multitude ms
the chafacterisng phenomena of The system. When
ever they take place, the people will always look e.
ctusteely TO The prominent parts Of that system. and
charge the whole calamity upon them, although
these may be the mere exponenls, aud not the cause.
Hence. during the middle ages, whenever CONNER
clal distress arose, the poor Jews, who were the great
money dealers Of Europe, were sure to 90 10 The 1rdN.
In London, TIL banks were established, Lombard
street, the great msneyed street, was made response
BILE. In the hard money countries, they are the
Rothschilds, the Laiittes, and the Torlanias-thc
great private bankers, who have TO bear the sin Of
every commercial ,eyulslon. In countries like Eng.
land and our own, where the progress Of civilization
mas reared that great engine OF mprovement-the
credit system-aDd sustained and developed ii by
he operation Of banking companies, the banks must
of necessity become The most prominent parts Of the
system hence we are not to wonder that with us an
indlsciiminaling tribunal should charge the whole
EVIL OF commercial reyulslons upon the banks.
Wien men cannot pay their debts, they are very
apt to charge their ruin upon their creditors. In a
banking country, banks will of course be the largest
creditors, and therefore, will be charged with most
oil the sin. The popular clamor in the country a.
gainst all banks, since the late pressure, seems to me
TO be a perfect illustration of this general remark.
A lew years ago, when the credit system was stretch
ed TO lis extreme limits, and the country seemed to
be enjoying unparalleled prosperity, there were
those who could look on and stimulate the banks TO
yet greater expansions and the moment they had
thus overstrained the system, MI the whole super
structure was overthrown, could then come forward
and calmly recommend a total discoDnection OF the
government with them, because of the mischief
which the laltet were supposed 10 have produced.
Now, the fact is, that the rage for speculation al
most always precedes that for banking. The effect
Is mistaken for the cause. 1t is true, however, that
the effect in time becomes a powerfully operating
cause, as is frequently the case IN political economy.
Tooke, in his great work on high and low prices,
aa pt,,, t,,nSt ma, ln., that =, nln,.., -.
case. OF what Is called oyertradng, The great propel-
ling cause in the first instance, has been entirely cr-
trdRe0uS TO the banking system the operation OF the
latter being exerled secondarily and deriva,iyely. |
do not pretend TO deny but that the banks may often
carry the spirit OF speculation farther than it would
otherwise go but to charge them with the whole
evil is most unfair. One Of the most terrible re.
WILSON'S in trade. which has occurred Tor the last fifty
years, took place 10 Hamburg, in 1899, where
there was not a single bank Of circulation, nor
a single bank note passing from hand TO hand.
Wherever The credit system is erected, and The
trade is great, and a part Of il hazardous, there you will
have occasional revulsions, banks OF no banks. Wher.
ever the trade is between the merchant aud farmer,
with lItile or none Of that hazardous branch which
may realize millions to-day and sink them to-mor-
row, there you have but few revulsions in trade,
whether your have banks or not. IL there has not
been a single failure in our lille village, it is
not because we have ns bank, but because we
are engaged in a trade altogether between far
mer and merchant. Scotland had more banks
than any country in Europe, in proportion 10 its
population and wealth; and yet, where in the world
shall you find greater stability in the whole monetary
system! And why! Simply because the trade Of
Scotland is altogethera safe trade-trade on a limited
scale. The whole of Scotland exports only one
fifth of what is exported from the single city OF Lly-
erpool. You have icyulsions in London, Liver
pool, and New York, not because Of the banks, but
because of the great and nuctua'ing trade which they
are carrying on. When the stake is great, YOU
must encounter greater hazards.-When YOU are
playing for the great prizes in the lottery, you
must expect TO draw occasional blanks. You have,
it is true, fewer revulsions in France, Spain. Italy,
&c, the hard money countries, than you have in Eng
land and the United States; but is not the differ
ence owing to the fact. that England and America
have SO far excelied all their competitors in the great
struggle for the International ommerc of the
world! Fit were possible TO throw the immense
trade of London, Liverpool, and N. York into lIa-
vfe, Cadiz, and Venice, you would soon have oc-
casional overriding and revision but | imagine
those cities would thankfully receive the boon, with
all its attendant evils.
| have made these general remarks on banking,
because it is impossible TO disguise the fact, that this
sub-treasury scheme is nothing more than a decla-
ration of war upon the banking system. The cry
now, is, for a divorce of the government from banks.
Such a divorce cannot take place without mischief.
To put down the banks is impossible, unless some
scheme is devised TO ruin them all. That be
ing The case, we are bound TO act IN manner
which will best secure the interests and har-
mony OF all.-The sub-treasury scheme VIII not
answer the pun pose-first, because il would, rs has
been conclusively shown, make specie a mercliahta-
BILE commodity, by giving III Premium, and thus
forever prevent the resumption OF specie payments,
or keep the banks IN continued Insecurity, II they
should ever again pay specie. Secondly, because l