Southport telegraph. [volume] (Southport, W.T. [i.e. Kenosha, Wis.]) 1840-1850, 1847-03-31
ARTICLE ON BANKS AND BANKING.

So far as a system of banking is concerned, we
have been and are in favor of removing all restric
tons whether upon individual or voluntary assocl-
ations, and of placing the whole matter free from
legi sative tampering and meddling under the VI
gilant guardianship of the public intelligence, and
the control of the two mutually corrective princ-
Piles of free association and free competition. And
we should have been glad had the makers of our
constitution after providing against special acts OF
incorporation for purposes of banking, lett the
field thus open. The only difference between them
and us is here They propose to guard the public
by constitutional prohibitions and legislative pen
atieswe propose to let the public gurd itself land
to give the evil full scope to cure itself. We can
not but see however that there many and weigh
ty arguments in favor of the Constitutional prohl
billions proposed and we refer the particular atten
ton of the reader to article our first page from
the Racine Advocate, as containing some OF the
strongest OF these arguments
We agree with celebrated writer, that it is i'm
possible for the sovereign authority IN any society
to be too careful to abstain religiously from any at
tempt to interfere with the natural laws OF trade by
which the real value of all commodities including
money, as we'll as any other, is regulated and on
thewhole eventually equalized throughoutthe COM
mercal world, with the due allowance for the eX
pense of transportation and interchange. "Ihe eX-
pertinent of such interference has been frequently
tried in ages and countries OF seml-harbarian igno
rance, by arbitrary changes IN the value of the cir
culating medium, whether by alloys OF the current
COIN or by an artificial enhancement of its nominal
value; but the natural laws of trade, even when
most hampered and perverted by legislative regu-
lation have never failed to rebuke all suclfatempts
at despotic quackery. 1t is true, that sucn
would increase in given ratio the whole nominal
amount of money in circulation in the Country-the
opponents Of the foolish and wicked measure being
killed by the grave assurance that there IS not gold
and sitUer enough for 5tS exchanges without re-
course to this admirable invention for increasing
Its apparent amount but it Is also no less true, that
such attempts have always been founded in fraud
on the part of the governing power from which they
have proceeded and for whose benefit they have been
devised and have resulted in the most pernicious
consequences to the community at large 1t is al
so true that they have always eventually termina-
ted in failure and dsappointment,no arbitrary legs-
lation being equal TO the task of struggling against
the tides Of trade of the commercial world and of
maintaining for any length OF time false standard
Of value, enhanced above, or depressed below the
regular standard, established by the universal prac
tee of the world. The result of all such expert
mcnts has been to explode utterly the tallacy on
which they were founded, and to establish the truth
that the legitimate power of government, beyond
which they cannot go, without certain failure and
and strict "specie standard"
1t was doubtless in view of this truth, as deyel-
oped and established by experience, that the Con-
stitutionaI Convention of Wisconsin deemed it a
course of sound policy to adopt part of our fun
damental law, the prohibitions which it contains
upon the subject of Banking
1t is useless TO talk of having a "well regulated"
and safe banking system, so long as the two func-
tonsof cTeatiaing and lending the currency are in
the same hands, because from their very nature,
(both under perpetual natural stimulus to excess
it is impossible for them 10 co-exist in the same
hands, whether public private, without the most
perncious abuse. awe are convinced (says
able writer on banks and currency that no sys-
tenn of banking, however organized and regulated,
can be secured against the evils which have re-
suited from the practice both in England and iii
this country, and In still worse degree with us
than in the mother country-lf its restrictions stop
short of establishing this essential principle viz
separation of the two functions ofcreatiag and tcqd
ing tho eurrenoy." a little refecG6d will
vince any one of the soundness of this principle.
The idea that Banks are needed for the purpose
OF Creating capital sufficient to answer the demands
OF trade and develope the resources of our new
state, is a tallacous and absurd one. To use the
language OF the able writer just before quoted " If
there was not sufficient supply Of capital in the
community to satisfy the reasonable demands nj
industry, skill and fidelity, arising out of the cir
cumsances OF new country teeming with unde-
veloped resources and inhabited by an enterprisng
and intelligent population the only and the certaia
consequence would be that it would flow in from
communities differently situated, and where money
was less productive and therefore less valuable, to
I'LL the vacuum OF demand up to the full point OF
requisite supply. No physical law of nature is
more certain in It's operation than the law de
mand and supply in the great Republic of COM
merce which is composed of all the producing and
mterchanglng nations of the earth. 1t is equally
applicable to money to any other commodity
and no mistake can be greater than to suppose ii
necessary in any possible point of view advan-
taSeous for any particular community to attel. pit
TO increase its supply by artificial means, under the
idea that the world does not contain enough TO
satisfy Its extraordinary demand, that its "air
proportion Is not enough for its wants" The
proposition, although it may be gravely advanced
by nifty LAYERS and statesmen, no less eminent than
a Webster is absurdity and a seicontradiction
IN terms, for countrys fair proportion" is no.
tmng more nor less than the supply required by its
far and healthy demand. Such attempts must al
ways result III failure and the selfiniicted punish
ment of the folly and ignorance from which alone
they can proceed
The trainers of our constitution seem TO have
been sufficiently versed in matters of political econ
omy to be aware OF these truths and sufficiently re-
gardtul of the best interests of the new state to
make adequate provision for their practical recog-
milton.
But then there is not specie enough to answer
the demands OF trade. This is the grand argument
against the 9th section Of the Bank Article: vet a
most talaclous one On this point we take the
following from well written communication in a
late Fon du Lac Journal which we deem to be con-
elusive We trust the reader will give it a thor
ough perusal:
he whole circulating medium of the country
(specle bank notes and credits,) is estimated by
Mr Gallatan, who is good authority on such sub
lects at from ! 10 to 1870 millions, The same wr-
Ter estimates the amount of bank notes in actual
clrcuiauon' IN 1880, at 81 millions. This may be
uue when the loans and discounts of the Banks may