The Madisonian. [volume] (Washington City [i.e. Washington, D.C.]) 1837-1845, 1842-02-19

|
the States the annual nett proceeds of the public
lands. For the rest the People of the United States
who also the People of the States, have the re-
| medy for this evil in their hands by the better
regulation of their own finances and the imposition
of taxes to pay the interest of their public debts.
| 1t cannot command and compel the State Legsla-
| lures to to authorize the suspension OF cash
payments by their banks, nor prevent those banks
from issuing bills of credit to accommodate the pre-
sent wants and postpone the final payday OF indvl-
dual debtors of the States 1t cannot, by its own
direct act retire from circulation their deprecated
bills the currency of which is the greatest evil of the
| times. But it act on the subjectmatter by the
| refusal to receive any thing but coin equi-
| valent paper in its own dealings, and if it receive
bank bills by exacting payment of them at frequent
specified periods. And in the opinion of many, who
| are conversant with the subject, and whose expe
rience and judgment entitled to consideration, it
can to some degree, remedy the disorders of the
currency, by applying to legal artificial persons
the laws for the immediate distribution of their
assets and discharge of their debts, which apply to
| natural persons.
1t cannot give to the country paper currency in
| the bills of an incorporated join-stock bank of pri-
vate stockholders; for the constitutional opinions of
the President and of considerable part of the mem
bers of the two Houses and of the People at large,
constitute at present insuperable impeachment to
the incorporation of National Bank and if it could
be Incorporated, it would be impossible apd if pos
sible, would aggravate rather than tighten existing
evils, to collect the stock of such institution 1t
can, however, provide national paper currency of
adequate quantity, and of better quality, by other
means.
1t cannot equalize the exchanges throughout the
country long the currency of most parts of it
consist of rredeemabe bank bills in various degrees
and stages Of depreciation and the business of buy
ing and selling is transacted part of the coun-
try by means of specie values, and in another by pa
per values. Most Of the existing rate of exchange
between different parts of the country is not the diff
ference in price between legal coin in place and
legal coin in another, of the cost of transporting it
TO settle balances, but the difference between the
price of the coin currency and of the paper currency
| at the same place. This Congress cannot prevent
But il may provide safe and economical medium of
| exchanges, correspondent to the true value of
change regulated by the course Of business, ac-
| cordng to supply and demand in specie medium of
payment.
1t cannot, by any act of its whatever, proceed
immediately to fill the channels Of commerce with
paper currency equal in rate of value to gold and sill
YER neither by of National Bank nor by any
other fundamentally whatever. For the same rea
son that, in the market of deprecated paper cur
rency, coin cannot be kept in circulation but becomes
at article of merchandise, and is bought up
such, and disappears just will it always be with
| specie value paper currency alongside of depre-
! cated paper currency. Until State Governments
to authorize sanction the issue of irredeema
BILE bank paper in given community, that commune
ty cannot have any better currency But the Fede-
raj Government can adopt the means to furnish pa
per currency of par value to be ready to take the
place of the deprecated paper currency, as
that shall be driven Withdrawn from circulation by
the direct action of the State Governments by the
indirect action of the Federal Government.
What, them shall Congress- do What ought ii do
To reach the to these questions, let us cons
der the advantages and the disadvantages of the plans
heretofore used in the fiscal business of the Trea-
sury.
Leaving of the all debateable constitution
al questions involved in it, and regarding it prac-
teal matter only the considerations alleged in favor
of National Bank, are
l. Its convenience in the collection safe-keeping
and disbursement Of the revenue
2. Its utility Ito certain degree) agent of
| exchange.
| 3. Its being the means Of furnishing paper cur
rency to circulate in all parts of the United States
A. Its nstrumentaty, by the periodical settlement
of balances, in regulating the paper currency of the
States.
s. Its being the means of utilizing the public depo-
sites by discounting on them.
On the other hand, the practical objections to it
are, substance
l. The peril to the public welfare Of taking from
the Government itself, appointed by the people and
responsible to them all this vast power the pub
lie funds and the currency and exchanges, and plac
| ing it for long period of years in the hands of
private corporation, and of bank directors having
interests OF their own, and irresponsible and nacces
| sible to the people themselves.
| 2. The chances of mismanagement and corruption
the part Of such corporation in the ratio of its
| power.
g. The possibility that may itself make excessive
issues, suspend payments in SPECIE and instead Of
aiding to regulate the currency of the States become
itself the great cause Of arrangement.
a. That 1t is no part OF the proper business of the
Federal Government to carry directly indirect
| ly) the business of discountng notes bills,
otherwise lending money, to furnish funds to be
| lent.
Concerning the adoption of the State banks the
fiscal agents and repositories of the Federal Govern
| ment, the consideration for is
That, if there be no National Bank, it is necessary
to employ the banks of the States unless the Govern
ment choose to discard all bank agency.
And the main considerations against it are
l. That the Federal Government ought not to be
dependent on the legislation Of the State Govern
ments for the means of conducting the business of the
| Treasury
2. The perpetual liability of the State banks to e1
cess OF issues and to suspension of specie payments
Fl 5. The difficulty of giving national unity of
ton to institutions which essentially local in their
nature and uses, and in then currency.
4. The liability of the system to political abuse.
The system OF an independent Treasury is recon-
mended-
L. Because of its independence of all agency not
the Governments, and especially because ndepen-
dent of banks
2 Because it holds the public funds for the public
use only.
g. Because, by the use of coin only in the dealings
of the Treasury it tends to bring back the country to
the money standard of the Constitution
And it is opposed
| L. Because, by the exclusive use of coin it rejects
the tme-saving and labor-saving instrumentaty of
paper, which, 80 it be of specie value Is in many re-
spects preferable in use to COIN
g. Because it locks up the public funds from all en-
ploymen either directly the basis of paper issues.
g. Because, under it, the United States has pa
per currency of national circulation.
a. Because it separates the Government from the
People, aud disavows all incidental duty towards the
latter in the business of the Treasury
Which of these three systems is the cheapest and
SAFEST that is involves the least expense and loss to
he 10 9TH han