Morning herald. [volume] (New York [N.Y.]) 1837-1840, 1839-12-27

bring N any way with the useful and proalaSle
empl4ymenl of real capital
ln&ifutiots 70 framed havefxiste4 and stH exist
esewh here, giving to comm srlal intercourse all
cesssty facilities, without initiating depre catinK
the currency, or stimulating speculation Thus &C.
complaining their legitimate ends, they have gained
the sHrest guarantee for their projections and en-.
couragement in the good will Of the community
Among people 90 t,st a SpF tlte sane reeu!tt
conld met fail to attend similar coarse. The dis
rect supervision of the banks belongs, from the
natnra af aKaramant, tina States Who aaths
RE them Its TO their egsiaturef that the Peg
But as the conduct Of the Federal Government ID
itIoSsh les imasaiate influence aSon them, il BE-
comes our duty 10 see, that a proper airectl6n
is given 70 Y, While the keerins of ihe pIH,bic
revenue in separate and Independent TEA
sary, and Of collecting il in goid and silver.
win, have sautary influence on the system Of
paper credit with Which all banks are come cted,
and thus aid those That are sound and well man
aged, It will at the same time sensbly check such
as dre olherwsr, by once Withholding The cans OF
exuasasance afforded by he pubic funds, and res,
training them rom excessive iss les of no. which
they would be ccpsanty called upon 70 redcani, es
am aware il has been urged that this control may
be best attained and exered by means of National
Bank. The constitutional OBJ ectians, which | am
well known to entertain, would prevent mein any
event from proposing or asserting to that remedy !;
but in addition TO this, cannot, after past expert
ence, bring myself think that il any longer be
extensively regarded as effective for such purpose
The history of the late National Bank through all its
mutations shows that it not On the contrary,
il may after careful consideration of the sub ect
be, think, safely stated, that at every period Of
banking excess il tnok the lead; that in 1877 and
lSl9, In 1929 in 1881, and in 1891. its vast expan-
sions, followed by distressing contractions, led 70
those Of the state institutions 1t swelled and mad
dencd the tides ofte banking system, but seldom al
layed, safely directed them At few pc RODS only
salutary coatro exercised, but eager desire,
on the contrary. exhibited for profit in the first
place and it, afterwards, its measures were severe TO.
wards o her institutions, it because its safes
ty compelled it to adopt them. II did not differ from
them in principle or in form its measures emanated
from the same spirit OF gain il felt the same temp,
tation to overssues it suffered from, and was total
ly unable to avert those inevitable laws Of trade by
which il was itself affected equally with them and
atleast occasion atan early day, was saved
ly by extraordinary eXertOns from the tate that
attended the weakest Institution proessed to super
wise In 1897 it failed, equally with others. in redeem
ing its notes. though the years allowed byits chan
ter for that purpose had not EXPIRED large amount
OF which remains to the present time outstanding.
1t is true, that having so vast capital, and
strengthened by the Of all the revenues Of the
Government, it possessed more power; but while it
was ITSELF by that circumstance freed from the
troll which all banks require its paramount object
and inducement were left the same-to make the
most for its stockholders not to regulate the
cy of the country. Nor has it, as far as we are adj
vised, been found to be greatly otherwise elsewhere.
The national character gwen to the Bank of England,
has not prevented excessive fluctuations in their
currency, and it proved unable to keep OIL suspen-
sion OF specie payments, which lasted for nearly
quarter Of century. And why should we expect il
TO be otherwise national institution, though de-
irving its charter from different than the
State banks, yet constituted upon the same prin.
ciples; is conducted by men equally exposed TO
temptation; and is liable the disasters with
the additional disadv antage that its magnitude
sions extent of confusion and distress which the
Encouragement of smaller institutions could not
produce. Ii scarcely be doubted THAI the re
cent suspension of the United States bunk Of Penn
sylvana-of which the effects felt not in that
State alone, but over half the Unionhad its orr.
gin in a course of business commenced while u was
national institution; and there is good reason
for supposing that the consequences would not
have followed, had il still derived its powers from
the General Government IL is in vain, when the
influences and impulses the same, to look for
difference in conduct or results. by such creations
We do therefore b0 increase the Of paper credit
and paper currency, without checking their atten.
tant evils and fluctuations The extent Of power and
the efficiency Of organization which we give, far
from being in practice positively njayi.
easThey strengthen the cham Of depe
but the Union, subject all parts more certanly TO
common disaster, and hind every bank more efiectu.
ally, in the first instance, to those Of CONNER
cial cities, and in the end, to aforeign power On
word. cannot but believe that, with thu full under.
standing Of the operations Of our king system
which experience has produced, public sentiment 10
not less opposed othe creation Of national bank
for purposes connected with currency and com
rec, than for those connected with the fiscal ope
rations Of the government. trrEes y h 3 Z. u
Yet the commerce and currenc v ofthe conntvy are
suffering evils from the operations of the State
banks which not aad ought not to be overlooked
BY their .means, we have been flooded witha de-
precisted paper, witch il evidently the de-
Sign Of the trainers of the Constitution TO pre-.
vent, when they required Congress 10 ICON money
and reg uae the value of foreign cons'A and
when they forbade the STATES "to coin money,
emit bills OF credit, make any thing hut gold and
silver tender in payment Of debts, or /" pass any
law inpairing the obi gaton Of acontractv.r IT
they did MT guard alicity against the pre-.
seat state Of things, it because they could not
have anticipated that the few banks then existing
were 20 swell to exteat which would sxpel 20
90 great degree tho gold and silver, for which
they had provided, from the channels Of circula.
ton, and fill them with currency that de-
fcats the objects they had in view. The remedy
for this must rest chiefly with the States from
whose Legislation IL has sprung. No good that
might aocrue in a particular case from the exerr
else OF powers, not obviously conferred on the
renee or Justify that might 10 the slightest
degree, Increase at the expense of tho States the
power Of the Federal authorities-nor do doubt
that the States will apply the remedy. Within The
last few years, events have appealed to them too
strongly to be dsregarded. They have that the
Constitution, though theoretically adhered tots sub
verted in practices that while on the statute books
there Is no legal tender but gold and silver, no
law ifnparing the obligation Of contracts, yet that
in point Of fact the privileges conferred bank.
ing corporations have new made their notes the cur