The Madisonian., 1840-01-11
From tie South Wtaers Viygisian.
COPY OF A LETTER

To the Secretary Of tho Treasury, sftsr the Banks
stopped Specie Payments in 1887, IN which me
Treasurer gives bis views the proper course 70
be taken BY the Government;
THgAsUHEEs oyYIcg.
25,h May, 1887
Sir--In the communication had the honor TO re-
eeye from you yesterday, my opinion 10 asked upon
several questions arising Of the late deposlte law o
Congress- passed in Ju6e. 1885, and The embarrassing
dc uliies WHICH have unexpectedly been broogh, upon
the Treasury Department, consequence OF The sus-
pension Of specie payments BY the Banks
After the expression Of my Acknowledgements for the
manner IN which the Hon. Secretary has done me the
honor ask for my upon the very important and
interesting subjects Of his letter. will proceed with the
utmost ffsnkness ard freedom disclose them 10 HIM
First is asked how the public funds 10 be with
drawn from the Banks that have violated their engage
nenis with the government under the posislons OF the
9Th section OF the deporjte law, which requires the Se-
cretary Of the Treasury withdraw the public Depo-
sites from Bank that ceases 10 pay specie "aod also
requires that default Of any bank receive such de-
poslies the money thus Withdrawn to be Kept BY the
Treasurer Of the Unied States, according TO the laws
oree and be subject TO be disbursed according
10 law"
Ia reply to this in,erogatoy, have to state that
there Is no mode IN my opinion. by which the Secre-
tary Of the Treasury IN fact withdraw the public
funds according TO tho provisions Of this law from
Bank that has ceased TO pay specie. The execution Of
the law is maufesty upon IT'S face impr ctcsble noh-
ing can be received ia payment IL the public dues (f
the law complied wlth) but specie the noes Of Sps
eis paying Banks. How then the Secretary with
draw from Bank the public funds when it has eeased
10 pay specie or he notes Of spe.is paying Bank
lie Is not authorized 10 withdraw the funds until the
Bank ceases to pay specie, aud after it to pay
1t Is mauiestly impossible to withdraw 1t.
A law that cannot be executed, consider dead let
ter, mere nulty. to which public officer be
qured 10 pay attention What good can result in the
idle effort 10 do impossible thing
But suppose the law could be executed by the Secre
tary OF the Treasury so far as to withdraw the funds
from The Banks, in what way they to be transferred
10 the possession Of the Treasurer aud 'kept by him
according to the laws In forcel"
lie has at this lime standing 10 his credit in the DIFF
ferent dePoste Banks that have ceased paw specie
about rs or 80 millions Of dollars Was il ina
gined by Congress for moment that such a in
specie be transported TO the Seat Of Government,
and placed the actual possession Of the Treasurer
without having made solitary provision Of any kind
for It's safe keeping SUN exceeding IN amount,
perhaps all the specie in all the Banks Of The United
States
Where is the Treasurer to keep such sum Of money,
if it possible to imagine that any conem-
plated that he was to have actual possession Of IL No
Bank house, vaults and guards have been provided and
all these would be necessary II 25 millions Of specie
should be PLACED under his and yet constituting this
aforesaid deposite law according its literal meaning,
the whole Of the United States collected
gesher specie TO be placed in the possession Of tho
Treasurer Of the United States, when the depose
Banks fail to pay specie, as hey hare alt actually done
at this time"
II is then, sir, clearly impossible to execute this
law, and really think that the good Of The country
and safety Of government requires that should
lei things remain as quietly possible, and do no.
thing but what is essential 10 keep the Government
in operation and avoid all useless efforts do i'm
possible things, which only tend irritae the pub
lie mind, and endanger the peace and happiness Of
the country. would draw on the Banks as usual
transfer the public money from Bank TO Bank as
usual, to suit The convenience Of disbursements and
pay 10 the States by transfer drafts as you have
heretofore their quotas oil the surplus the
proper periods, and aUoid erery thing chich can, in
ne slightest degree, iyurc The eredn Of these Banks,
which hold in their possession such immense sum
of the National Treasure, rhieh must all be lost If
their credit is destroyed.
In few months Congress will be in session, when
this whole subject wilt be referred TO the Legislative
power by the President ard Yourself and when
presume immediate legislative provisions will be
made 10 enable the Executive TO administer the Co
vernment according 10 laW lam very confident that
mortal wisdom do il at this time and Keep IL
IN operation. We must then do The best
der the embarrassing and unexpected difficulties
which surround the depart nent and am sure, act
ing from such motives, we shall receive such APP
plause instead OF censure from the Representatives
of great and gallant nation who will never do in
justice TO faithful and honest public servant, who
labors for the public good, and conscienousy per-
forms his duty 10 the best Of his skill and Judg-
ment.
/ therefore sincerely think under all the circum-
stances connected with the condition OF the nation at
this time, that the least that possibly be done, The
better for the country, until some regular system Is
established by Congress.
The public mind ought TO be assuaged and the
credit OF the Banks preserved as much as possi sibe,
until they enabled to pay out The public money
II drafts are protested, they must take the course
recommended in your circular.
But Think the disposition ought TO be encouraged
IN recpiyp in from the dpnpsitp haD
on the part OF the public creditors Under the Pc
cuar circumstances, il is best for creditors as well
the country.
would particularly recommend that course a,
the seat OF Government In payment OF all the public
officers It will tend to inspire confidence in the
Banks, and accelerate the period when specie pay
menls be resumed, whilst contrary course will
make the evil worse, and njure all the parties
cerned.
do not see the necessity or,the policy at this time
to make any prepa 10 institute suits against the
securities Of the Banks The subject Of their liza
bilities could think, be very properly delayed for
few months, until the meeting of Congress.
If however, the Secretary should think differently
would then say the usual transfer drafts should be
issued upon the Banks failing pay specie for the
whole amount standing to my credit in tavor Of the
Treasurer Of The United States; and upon the failure
Of the Banks to pay specie here in Washington that
suits be instituted for the violation Of their contracts
one stipulation of which is, "that they will give
whenever required By the Secretary Of The Treasury
the necessary facilities for transferring the funds
from place to place within the United States and the
Territories thereof and for distributing The same in
payment Of the public creditors, wi hout charging
compensation or claiming allowance on account of
difference Of exchange"
The transfer draft would of course, be the proper
form to be adopted BY the Secretary 10 Test the fdetny
Of the Banks in their compliance with their engage
ments, and the return of it unpaid, would be suff
cent ground for the Secretary to institute SUITS he
should thnk it the proper course in the present cr
sis TO pursue the rigid exactions Of the law. But