The Madisonian. [volume] (Washington City [i.e. Washington, D.C.]) 1837-1845, 1842-03-03

4
Now, under the operations of the Exchequer,
we should have two kinds of paper currencles,
equally valuable in their sphere of action, and
equal to gold and silver at the points at which
they are issued. Take the inverse Of this pro-
position, and the argument is equally conclusive
ly sustained. If coin, which is as much mar
ketable commodity as a bale of cotton or hogs
head of tobacco, be dear, say five or SIX per cent
above the value of paper currency inconuert,-
bic into specie, so long as this state of things
continue demand for the precious metals will
exist, and consequently constant run on the
banks for redemption of their bills in cash, will
be made; and thus suspensions, failures, and
bankruptcies will take place,-lhe natural con-
comitants of such a condition of things in the
monetary system of the country.
We have endeavored, very briefly to deslg-
nate the evils that must necessarily result to US
from the continued state of non-resumption by
the banks; corrupt, because furnished with
none of the most powerful incentives to moral
rectitude animated by no patriotic sympathy
for our country, and requiring for their special
government a system OF laws adapted to their
moral degradation. That we have not been too
extravagant in our estimate of these evils, is
fully attested by the records of our courts
Whoever can contemplate these evidences OF
the unhappy influence of such banking system
on our society and our public institutions, and
not desire it's removal is Ito say the leasD an
unfit subject for reason and argument. He
would not be persuaded, though one should
come to him from the dead" We have endea-
vored to point out system Of measures by
which the suspended banks may be revived, and
the irredeemabe paper now ahoat in the coun-
try may be converted into cash.
1t is trite, but indispuable truth, that one
solid, well established fact, bearing upon any
particular matter will countervail long train
of arguments. Historical references will support
us in the assertion. In July, 1917, six months
after the late Bank of the United States went
into operation, the public deposites lodged with
the bank amounted to 1924, 746,641 26. This
immense amount of money was the accumula-
ton of revenue previously collected and dis
trbuted throughout to the credit OF State Banks,
variousy deprecated. BY this single operation
twenty-four millions of dollars were thus con-
verted (even by that corrupt concern,) OF
adulterated, local currency into specie, or what
was tantamount to specie, of universal circua-
ton and receivabiity. So far as history affords
us light it leads us to this point that in times
Of difficulty and CONFUSION in monetary affairs,
when the whole machinery is thrown into dis
order and confusion, the existence of a moneyed
power controlling in its action and operating CO.
extensively with the boundaries of the confedera-
cy, and possessing universal credit, and sup
ported by national faith, is absolutely necessary
to impart soundness and uniformity to a circu
lating medium.
We now come to the second division of the
subject. We will not stop to inquire into the
advantages, merely pecuniary in their character,
derivable from the adoption of this new fiscal
agent We will not dwell on the spur that
must necessarily be given to our navigation,
or on the additional employment to manufacture
ing labor, or on the general confidence that will
ensue. These are the considerations that will
of course occupy the attention of our statesmen
But there are other advantages to result from
felt by every class of the community, and will
operate alike on our wealth, and our national
strength and prosperity.
One of the prominent evils that will attend
the operation of the Exchequer, if inhibited
from receiving into its Golfers the notes OF spe-
Gle paying banks, will be the reduction OF the
currency This curtailment of the currency
must be attended with ruinous consequences to
all classes of society Labor, property, and all
marketable commodities, must necessarily be
reduced in value. Money is not merely the
standard by comparison with which the rela-
tive value Of commodities is ascertained at any
given PERIOD but it is also the equivalent by the
delivery of fixed amount, of which the stlpu-
latons, in almost all contracts and agreements,
may be discharged. 1t is plain, therefore, that
no variation can take place in its value, without
essentially affecting all these supulations. The
mischief occasioned by the sudden reduction of
the paper currency, and the consequent rapid
augmentation of its value, will be still greater
than what has been previously caused by It's de-
probation This increase of value constrains
the debtor to pay an increased price for property
which he purchased, when the currency was
swollen and cheap, and the creditor receives an
augmented sum, because it is worth more at that
time than it was at the period he sold the pro-
perty. 1t is thus that contraction OF the cur
rency deranges all values, and produces derange-
ments in the stipulations for the payment otmo-
ney between debtor and creditor; thus it is plain
and obvious to the most obtuse mind that the ope-
ration of reduction necessary TO effect the restora-
ton to cash payments, ifunalded and unsupport
ed by acknowledgements must be accompa
MED with great restraint and inconvenience 10