The Madisonian. [volume] (Washington City [i.e. Washington, D.C.]) 1837-1845, 1841-10-21

taDlished their own banks on sound basis,
would be the gamers. II only one State bank
could be established firmly on principle Of ade-
quate responsibility and confidence, the notes Of
that bank would be taken every where in prefer
ence 10 inferior paper.
Ii was urged in the convention which framed
the Federal Constitution, as an argument against
comforting ON Congress the power 10 create cor
porations, that il would ultimately supersede the
power in the States 10 charter banks, and now
il is argued that this power thus expressly mega
lived then,ls necessary TO regulate the same
power 10 the States. The power 10 regulate IS
generally power which can also destroy. II
the banking power Is conceded now 10 the
United States, how is il TO be limited except by
the discretion of the Federal Government IL
one bank be made by Congress why may
not fifty banks2 Shall we be told that the i'm
policy of over banking will restrain the Federal
Government more than the State governments?
Both governments represent and reflect the
wishes OF the same People, and the causes which
lead TO excuses in one will operate in the other.
Our Federal Government is designated 10 ac-
complish under the grants OF the constitution,
those objects for which the governments of the
States are inadequate. Ii should attempt nothing
which involves the assumption OF powers not
granted, or which can be more safely exercised
by the States. While the banking power has
been so long exercised by the States as not 10
be now questioned, II has never been employed
by the United States without the disapprobalion
OF large portion if not majority OF the Union.
The arguments for National Bank have varied
with the circumstances of the country In 1871
II was urged by Alexander Hamilton and the
politicians Of his school necessary to aid in
the establishment of a national credit and TO ia
| ciitate the payment OF the debt of the Revolu-
tion. In 1916, when heavy debt had been ac-
cumulated in the last war with England, a war
to which most Of the Federal party were oppos-
ed, the second bank was sanctioned by some of
those who had opposed the first, and il was voted
against by some Of those who had resisted the
declaration and prosecution of that war. On
both occasions the foreign relations and financial
necessities OF the government were supposed 10
influence the question, and at both periods the
power was claimed and resisted as one Of that.
class OF Incidental powers in reference 10 which
political parties have divided since the constitu-
ton was ratified.
Such have been the abuses of the banking
system in the United States, and such the change
OF public opinion as TO its influences on society
that now national bank is no longer urged as
means OF accommodating the mass Of the peo-
pie by means Of loans, but simply as fiscal
agent TO enable the Federal Government to col
lect, keep, and disburse its revenues If a bank
is only necessary for these purposes, why is il
sought to extend the charter for period oftwen-
ty years, and TO associate with the Government
number OF other corporations and individuals
Why Is II necessary To give II the power TO lend
and TO borrow, 10 buy and 10 SELL to acquire pro-
perty and to hold it2 A mere fiscal agent NAV
be changed dispensed with at the convent
ence OF the Government, as il is designed only
10 aid the Government TO execute its unques-
toned powers in collecting, sate-keeping, and
discussing the public revenue. The argument
for a United States Bank as fiscal agent like
that IN favor OF regulator OF the currency is de-
rived again from the defects of the State banks.
If the State banks were so managed as to fur
nish convenient and safe currency for the Peo-
pie, it is clear that they would also furnish me
dunn in which the taxes, &c. of the Federal as
well as the State Governments might be col
lected.
Conceding for the argument sake the aues-
ton OF constitutional power in the Federal Gov
eminent to create banks, let US look at the ex.
pedency OF creating one merely to furnish the
medium through its notes. its vaults and its Off
GERS, of coecting, keeping, and paying out the
revenues. First the Government stipuates with
the corporation and binds itself TO receive its
notes IN payment Of the revenue Second, the
bank is permitted, by compact, to keep the pub
lie money and to use it in the form of loans to
its customers, or otherwise, at its pleasure. The
privilege OF furnishing in its promissory notes
medium which Government is bound TO receive
in payment of taxes, &c, and the privilege of
trading on the public revenue when collected as
part OF the capital OF the bank, privileges con-
ferred on the individuals constituting the corpo-
ration They receive an interest on the notes
issued TO furnish medium in which the taxes
are paid, and on the amount of the revenue on
deposite which they are enabled to loan out
Can it be necessary for Government to form an
association of individuals by its charter, merely
TO obtain the convenience Of using, in this man
ner their credit, inferior to their own or is il to
enable these individuals to use the credit of the
revenues OF the Government for their own cnds2
Is the bank the benefactor of the Government,
OF the Government of the bank, when the one
creates the other, gives II credit and the priv
lege of issuing its obligations and demanding
interest for them, compels itself to receive
them as money, and allows it to use the pub
tic revenues as Its own property, while the
other does nothing in return but enjoy these pri-
vileges
But 1t IS said the people, apart from the Gov
eminent, have an interest in national bank as
a means OF regulating the currency have en-
deavored 10 show that, unless such bank is
better organized and managed than the present
State banks, II would soon require the same re-
gulation. No one would be willing that Con-
gress should regulate the currency or circulation
OF the State banks by law, and vet it is main
tanned that corporation created by Congress
may 90 IT, II the notes OF a bank are received
IN payment Of dues TO the Government, Govern
ment has the same right as individual, 10 de-
mand their payment in specie. and with reve-
nue. OF hiteen or twenty millions a year, IL is
easy to perceive that the power of the Govern
ment over the bank or banks whose nores it
would hold, would be sufficient TO control if not
destroy them, while there is so much difficulty
in specie payments. The control acquired by
this means over banks is more immediate and
extensive than if Government should at once
collect It's entire revenue in specie
Does IL not occur to those who insist that the
Federal Government should regulate the cur
rency through the agency of bank, that the
same end NAV De more safely AMI ,nectu.ll, a.,