The Madisonian., 1840-02-04


,1ns hardened, would not have been accepted Il
Ia ~, heen expected that most OF The branches
.la h.v. been suffered 10 continue by The suffer-
of IN. Slate Legislatures, II was not foreseen
~, General Jackson cuud not, or would disiin-
.L h.,ue.n two institutions so essentially differ
90 ,n.rs,v because they both had the same Presi-
"a he same name (; nor that the same iron will
saa nnappeasable wrath, supported as Il was by po-
,..i,v and poIilical power, which had been exer-
P' i, CONGRESS 10 prevent the renewal oithe char
,,,a hs s,ill exeried ia the State Legislatures
"', ..a,.r, me continuance Of the branches. The
" ..,es WAS that most OF the branches were
a,oJ IL wind up their affairs, with some loss and
'"n ,an,s dtminution Of profit and their capital
S''' .sr.a a' n Philadelphia and one or two other
.,csss had 10 seek employment abroad and
po'a h.youa the legitimate sphere Of banking,
iu g,ea falling off in It's dividends The
aa,;,. Il chose proved, al first, very profitable;
81, i, afterwards became the source OIL emoarrass-
- - which have terminated in suspension, and
which now afford 10 its enemies so much matter OF
,,,mpb and congraiulation. But, while your party
e,ultin what is truly work OF their own hanuS, or
,,tbsr Of their u,trious chief, hardly think II
ripbt. sir that you should seek to screen MN ana
,hen from all responsibility for its mischieis'
The dependence OF Tue Ddnhs oh onc ouoe"e't ~"
which YOU lay SO much stress, Is, 10 some extent
,ne but |, must not be forgotten that this depend
enre is in the inverse ratio TO their prudence and
;ftbey we're not TOO much multip'ied-ii none were
allowed to go into operation which had not sol'd
CAPITAL and were placed under those restrictions
which experience has shown TO be salulary-ihey
would b, as independent Of each other as merchants
of any other class of dealers. We have some proof
ofthat in the New York banks, which have not been
obi iged to stop payment because the banks oil Phiia-
dephia and other places south OF them have stopped.
If all the Southern and Western banks have ieit
themselves compelled 10 suspend payment because
The banks of that city had suspended, The cause,
think will be found not so much in their dependence
on the lae, by reason of the course of trade, as IN
their own imprudence and in that overbankins whlch
vour friends have done much to produce. Had
he capital Of those banks continued as II was when
your party came into power, or had il not been in
creased beyond the increase Of population and trade,
,he banks OF Philadelphia had not recently suspend
ed and though they had, Il would have furnished
no sufficient excuse for suspension 10 the rest-nor
dared they have ventured 10 make II. With capt.
,al belter suited to the wants and means ei the
country each bank would have had larger proper
,ion of specie and smaller proportion ot crcuia-
ion I, Is that which has saved the banks OF New
j York
That degree Of mutual dependence and connection
among banks, which is unavoidable, so far from in
volving serious danger, may be made a great con-
servaiive principle, by reciprocaly checking each
others imprudence; but il must fail to produce this
effect if The suspension OF one bank is allowed to be
valid excuse TOR the suspension Of others.
The banks in one State, we know, are affected by
the suspension in other States in this way They all
have notes in circulation several times beyond the
specie in their vaults and part OF these notes are
in. The hands of distant banks. 81 long as all the
banks redeem their notes, when drafts are made on
a blnk from another Stale they may either be met
BY the notes of that State or If specie is insisted on,
then The bank which is required to pay il, may, in
turn also into specie such notes OF the dis
tant banks as il had collected. When, however, The
banks in one State have stopped payment, these
means of defence no longer exist and the specie
paying banks of other States may be drained oil their
coin, although they are provided with the notes of
the suspended banks sufficient TO set off against their
own
This is The plea now urged by the banks of Mary
land Virginia and other States south Of Pennsyl-
vania, and under existing circumstances il may be
deemed ad INVISIBLE. Yet it derives part OF its force
from the past imprudeuce Of these same banks, and
from their having, for some years past under the
delusons both OF real temporary prosperity and of
Fictitious wealth. set naught all those maxims Of
prudence and selfrestraint which previous expe-
rience had established Had these been rigidly OBJ
served the Southern banks Of all other banks would
have been able TO meet any drans that could have
been brought against them from any quar- err and the
knowledge of that fact would have inspired such
general confidence, that the suspension OF no two
three banks would have been regarded. Having
whsood the first shock, (for under such circum
stances they might lose much Of their specie,) they
would reap the fruits of their good faith
with the public. This paper, readily convertible
into specie, would, from its intrinsic convenience,
often be preferred 10 specie, and thus be the means
Of replenishing its Golfers. If the banks have not
been made to and act in this way, the cause
may be found in mistaken or deficient leg isation.
Had our lawg givers, national and local, done their
duty, the present mschiefs had not taken place and
il they would know their duty similar mischieis
would never again occur. He is but a Iecreant
statesman who frightened by the partial evils that
minge in all human concerns, would rather surren-
der the benefits of nstitu ion than SET about re-
forming its abuses; and to abandon the banking
system which, as a labor saving and economical
device, is as congenial TO our country and age as
locomotives and steamboats,, is about reasonable
as il would be TO abandon those locomotives and
steamboats, on account of their occasional explo-
sons. Whats sir would you think Of people who,
because some of its ships, from being balasled or
overloaded had ioundered at sea, would permanent
ly withdraw itself from the ocean, and this too, al
though such Of its ships as had been strong and well
formed had made, safe and prosperous voyages7 Yet
such is precisely the of action which your
arguments tend
But not content with over-rating the necessary
dependence of our banks on one another, YOU also