The Madisonian. [volume] (Washington City [i.e. Washington, D.C.]) 1837-1845, 1840-12-10
RESUMPTION OF PAYMENT.

=
BY the laws of several of the States the banks
now in a state of suspension are required to re-
sumo specie payments in the course of the cur
rent winter and the ensuing spring. Already
are negotiations concluded TO meet the require
ments of law in Pennsylvania, and Georgia is
preparing to resume in February. We do not
doubt that when the Pennsylvania banks begin
the resumption which is contemplated next
month, large majority of the southern banks,
if not all, will follow the example Those that
cannot resume, after so long an allowance of
time to recover themselves as they have had
will probably in most cases turn out 10 be insol-
vent, and be driven into liquidation, Ii is due,
not only to honesty and justice, but il is neces-
sary, in order to leave the coming admnistra-
ton as free as possible from embarrassment in
devsing a financial policy for the country, that
the State banks should resume specie pay
ments, or declare to the world their incompe-
tency, and wind up.
We confess we were under some apprehen-
sons that an effort would be made TO stave off
resumption TO an indefinite period, and our APP
prehensions were somewhat increased by the
publication Of letter in the Baltimore papers of
last week, and in the National Intelligencer of
this city of Tuesday, signed ID. A. Smith,"
As an endorsement of the intelligence and
financial reputation Of the writer has accompa-
MED the publication of the letter, we have
thought it worthy of some notice. But we find
we cannot agree with the author either in his
premises or in his conclusions, and we desire to
enter our protest against the effort of the Globe
TO make the Harrison party responsible for his
doctrines. We will endeavor to point out some
of the parts of the letter to which we cannot sub
scribe
| First of all we cannot see, with our present
lights, that it is ''nexpedientn for the banks to
resume specie payment.
In the next place he says
1.-THE causes which have produced the late suspen-
sion still in operation, and will continue to affect,
prejudciay, our moneyed institutions until removed
by the strong of Government, in the djustment
of our international trade upon terms approximang
to reciprocity OF advantages, as to reduce i'm
portations to standard accordant with national
means of paymen-the surplus product of our soil and
industry. Until that important desideratum can be
consummated, measures adopted for its successful
issue, in vain will the Banks attempt general re
sumption Of specie payments, with well grounded as
i surance of its permanent continuance.
The substance of this is that, excessive i'm
portations caused the suspension of specie pay
ments, and that the banks cannot pay their debts
in specie until the merchants import no more
than they export. Extraordinary mportations
constituted doubtless one Of the causes OF the
suspension of specie payments, but we do not
believe the banks would have suspended if there
had been no other cause, The primary cause
was the desire to make fortunes without labor,
which desire was encouraged by the extension
of bank facilities at the instigation or invitation
of the Government; and the proximate cause
was the bungling manner in which Mr.. Wood
bury executed the Distribution Act. The Globe
says it was the act itself. But is it probable
that the banks cannot resist the demands Of the
merchants for foreign trade, which, according
TO Mr.. Smith, drain their vaults, if they choose
A little further on Mr.. Smith says:
The action of the National Legislature, regulating
our foreign commerce, must precedc resumption, it
| will prove aborive. Our Government has not only
greatly reduced the duties articles Of necessity and
general consumption, but has admitted, free of duty,
twenty millions of merchandise, in one year, from
France, which come under the denomination OF luxu-
RES while France by way of recprocation, derives
of about three hundred dollars per hogshead
upon our tobacco.
Can the reader in any way imagine how this
can affect the question, especially when we in
form them that the whole amount of American
tobacco exported to France in lS39-40, was,
according TO the latest intelligence we have, only
451 hogsheads! But suppose Europe does levy
tariff upon our tobacco sufficient to pay the
''whole expenses of the government of the U. S."
out Of whose pockets does the tariff come ? The
consumers pay il of course, and that cannot be
good reason why the smaller portion Of the banks
of the u s. should not pay their honest debts.
That our financial affairs can be much benefited
by improvements in our foreign relations, we
fully agree, and we trust the present Congress
will do something TO raise our revenue from i'm
ports to The wants of the government For this
purpose wines, silks, and other luxuries may
well bear an additional tax.
There are three things alluded to BY Mr. Smith
which undoubtedly operate to embarrass a re-
sumption of specie payments. They are
LIST. Interest on our foreign debt, amounting
annually to nearly twelve millions
I'd. The absorption of capital by the continued
issue of Treasury notes.
| Sd. The existence Of the Subtreas act