The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1853-01-19
Our Washington Correspondence.


Prices are gradually advancing.
Our Washington Correspondence.
WASHINGTON, Jan. Is, 1853.
Congressional Proceedings-BiN to Prevent Frasds
ON the Treasury-G Galphin Claim Defsnded-Or-
position to the Small Notes Ba-Iheir Ertensise
Circulation Necessity for State Legislation
Difficulty attending the BM-Req,sired Issue Of
Silrr Coinage Measures adopted in England.
The proceedings in the House, during the past
week. may be summed up in the passage of the bin
to prevent frauds upon the treasury, which originated
in the Senate, and was reported by the Select Com
mittee appointed to inquire as to what connection
Mr.. Corwin had with the Gardiner claim with an i'm
portant amendment, prohibiting members or OH
GERS of either body from prosecuting claims against
the government, the debate on which was in great
measure confined to the attack and defence of that
gentleman, and towards its close was rendered re-
markable by the speech Of Mr. Stephens, of Georgia.
during which he went into an investigation Of the
Gaphin claim, for the purpose of showing that when
the State Of Georgia obtained the possession Of the
lands of the Indians within its territory it undertook
to liqudate the debts due by them to Mr. Galphin,
amounting to nine thousand pounds, with interest,
and who contended that the only question which was
to be decided when the claim was advanced was
whether the amount should be liquidated by the
General or State government.
As had been anticipated, the bill to prevent the
issue of small notes in the District of Columbia has
met with considerable opposition in the shape Of
amendments, it being universally admitted that the
practice constitutes serious evil and which is moro
extended in its operation than at first imagined,
it appearing that large amount of this irresponsible
trash is sent away for circulation in the more distant
parts Of the Union.
Not only is this the case, but as was stated during
the discussion, small notes from the State of Maine
were extensively circulated in Illinois, pending the
last election, and it may be presumed, also, in and
from other Sates and the attention of the different
State Legislatures will probably be drawn to the sub
ect, has been the case in Maryland when, by pro-
hbiting the issue of notes under five dollars, and
making all bank paper redeemable in specie, the
rency Of the country may be placed on sounder
basis, and the public generally be secured against
the imposition which is practised with impunity.
Mr.. Carttcrs amendment, prohibiting the issue of
all descriptions OF bank paper in the district,
gatived by an overwhelming majority; and very pro-
perly, as it is absurd to imagine that the business
transactions OF a community which was estimated
by Mr.. Bowie, of Maryland, at twenty millions of dol
lars, can be carried ON without the aid of paper
currency.
The BILL however, does not meet the issue Of ire
sponsbe notes above five dollars, except so far as Il
requires that they shall be redeemed inspece; and the
amendment of Mr.. Sackett, of New York, might have
been introduced with advantage, which required that
banks issuing notes Of a higher denomination than
five dollars should deposit with the Secretary of the
Treasury United States stock to the extent of OO0
and that their issues should be limited to that amount
which would have afforded ample security to the
public, and permitted the companies to derive an
adequate profit from the interest on the amount 90
deposited and on their issues
nbn Itxy hnn,a
contemplated sudden operation of the bill, which, Il
is contended, would enable brokers to fleece the com
munity by demanding four five per cent for silver
change during the scarcity which would thus be pro-
duced, and thus realize enormous gains. The more
prudent course, therefore, and that would meet
this objection, would be to give the bill prospective
operation-say to postpone for year its going into
effect, so far as relates to small notes. recurring
them in the meantime, to be redeemable in specie
and for the government at once to issue the requisite
amount of silver coinage to modify the revulsion.
The effect OF small notes on community is to expel
corresponding amount OF specie. and on their being
withdrawn 1t returns, to meet the demand in this
way created. There must be transition state how
ever, during which inconvenience will be suffered,
but which, in this instance would be less sensibly
felt if there were the issue from the mint to which
have referred, with which to make payments from
the treasury.
II was in this way the British government met the
dfculty OF resumiDg specie payments in England,
and the subsequent prohibition to issue or circulate
notes of less denomination than five pounds ster-
ling As early 1777 the issue of promissory notes
for less sum was prohibited by law, and the pro-
hibton remained in force till 1877 when the govern
ment prevented the Bank Of England from paying
specie, and with the sanction of Parliament this
prohibition was continued till lS23-a period OF
twenty-six years, during which notes OF less amount
were permitted to be issSed by the bank.
Ba the act directing the resumption of specie nav
ments introduced by Mr.. Peel in 1919 four years
before it actually took place. in 1923; and il was not
till 1926 that law was enacted prohibiting the cir
cnlation of notes under five pounds after February
1929, and which has continued in operation ever
since-thus allowing six years after the resumption
Of specie payments, for the circulation of notes Of
less value than fine pounds.
In the meantime, in 1921, new coinage of gold
had been issued to the amount of fl4 1877 5f7 which
supplied the chasm made in the circulation of the
country by the reduction Of the amount OF Bank Of
England notes, and also went to replensh the vaults
Of the bank, in preparation for the run that might
be made in the resumption specie payments, owing
to which precaution the danger that had been appre
hended was passed with the greatest facility. w.