Nashville union and American. [volume] (Nashville, Tenn.) 1853-1862, 1857-12-01
ON BANKS AND CURRENCY.-A vALUAAI.l.
LETTER FROM COL. BENTON

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GENTLEMEN: Many papers, DESTROYS of the estab-
lishment of National Bank, are quoting what Gen.
jackson said in favor of such an institution at the
beginning Of his presidency. have to remind all
such papers that what was so said was said before
Gen. jackson saw prospect Of restoring the cur
rency Of the Constitution, and that, after he saw
that prospect he said nothing in favor Of banks
National or State, bat the contrary, and abored du-
ring the remainder Of his public life 20 restore and
preserve the hard-mOney currency, which the found
ers OF our Government had secured Jas they believ-
ed for us. The plan OF that restoration and pre-
servation consisted Of five parts, namely: l. To re-
vive the gold currency by correcting the erroneous
standard Of 1891. p To create demand for hard
money, by making it the exclusive currency of the
Federal Treasury. 3. To make sure of this hard
money by keeping il in its own treasures. 4. To
suppress all paper currency under twenty dollars by
stamp duty. 10 wind up all defaulsing banks
by a bankrupt law against delinquenis
The first three of these five parts we're accomplish
ed. and 10 these We are indebted for twenty years
eXemptiOn-irOm 1887 10 lS57-from bank suspen-
sions and DEPRECATED currency; also, for carrying
the country through foreign war-the Mexican
without paper money and with the public securities
above par also, for having in the country this
lime full fifteen times as much hard money as we
had in the time Of the late Bank of The United
States; and we indebted to the want OF the two
latter parts Of the plan for what now see; near
Of them frauds from the beginning, and the bad
governing the good; general suspension in q sea-
son of peace and prosperity; people forced TO use
deprecated paper when there Is hard money in
the country than its business could employ; men
and women begging for work, and unable 10 obtain
it. when the country needs all the work they do,
aud has the means to pay for it; families crying for
bread when a bOuntIful Providence has given the
most exuberant that SEEM the business
Of twentyy millions Of people deranged, disorder
ed and thrown out Of joint; and all this the work
of the base part OF the banks falling down Of them
selves for want Of foundations, and dragging the
solid ones them. For it is in this of bank
suspensions il is with ship sinkingat sea, where
those who cannot swim, drag down those who can.
A stamp duty their notes, and bankrupt pro-
cess against themselves, would have saved the coun-
try from the csamities it endures Tor many of
The base order Of banks would have been unable to
MAKE CURRENCY" Tor want Of money TO pay for
stamps on their notes, and others would have been
proper subjecs for the bankrupt process in the first
few days OF their existence
The restoration Of the gold currency was effected
under General JacSsons administration; the estab-
lishment Of the hard money currency for the FEEDER
al Government and the keeping Of its own money IN
It's own treasures, was accomplished under Mr.. Van
Buren,, both Of which Presidents took the full res
possibility Of recommending these three measures,
and also the two olhers-the for the imposition
of a stamp duty on all paper money under twenty
dollars, and for bankrupt act against deaulting
banks. Bills were repeatedly brought into Congress
for both purposes, but always defeated by the
detection Of the Paper-mOney wing of the Democrat
ic party.
The most plausible of the open objections made
against the stamp duty in the expense, and the
extensive machinery for its collection. That was an
swered by providing a cheap and simple process for
both purposes clerk in the Treasury department
for superintendent Of the business and the clerks
OF the Federal courts TO deliver out the stamps which
they received from the treasury. The amount Of
the duty, and whether it should apply ali notes or
only TO those intended TO be suppressed, ques-
tons which there was for diversity of OpIn-
ion The predominant opinion was that there should
be duty upon all notes issued currency flor what
more lit TO be taxed than the moneyed pOwer?) the
duty being the same on all EOtes, and such as the
large ones could easily carry, and the small ones
not The amount OF the duty was held necessary
to be large-far greater than in Great Britain for
there no note is re-issued; one goes out Of the
bank second time, go that the duty in England ls
paid every time The bank puts out a note. Not so
IN the United States Here a note is re issued I'M
III IL is OUT until it has become too ragged TO
mold together, or too filthy TO be handled, or
90 much deiaeed to be deciphered. small duty
is, therefore, sufficient in Great Britain; it would
require 4 very heavy one TO be its equivalent
In the United States. Among the penalties for
violating the act either by issuing, receiving, or
passing he unstamped paper, should be dlsquah-
ncatiOn 10 retain receive Federal appointment;
for the pursuit Of Office is general at this time IN
country, and ardent, that, in arraying class
large, so influential, and active against the
stamped notes. their circulation would be efectuay
checGmated
The papsr-money wing of the Democracy was
still more against the bankrupt act against bankrupt
banks, than against the stamp tax on notes and,
acting with he ha0itual opponents of the party 10
which they protested to belong, easily defeated all
the bills. The open objection came from the Law
yers, with their professional idea, drawn chiefly
from British statutes, that merchants and traders
were the proper subjects of the bankrupt law, al
though every late British statute the subject IN
cudes banks, (the Bank OF England excepted and
IN single season Of suspension THAT OF lol3-'l4
80 nluety-tw0 OF these banks had been subjected
10 commissions Of bankruptcy. But this remedy
was not OF English, but OF Roman origin, as It's
uame would show, (''JaHcus" and ''ruptus,") and
bankers the original bects Of the law, the
same name also shows. "BrokeL-Bench" is the
he English Of the Latin name and was called
because The bankers money changers Of that time,
as now IN the Elst had their benches in public
places, on which they sat and did business; and
when any one became delinquent, or criminal, he
vas driven away and his bench was broken. And
thus, IN It's origin, bankruptcy process sgaInsl
banks and bankers, and still is in Great Britain
and hence retains its original of Broken
Bench-the bench so broken being the sign and
warning TO the public that the banker himself was
ins0yent, and deprived OF his place OF doing bust
ness.
Banking in the United States is the most uure-
strained and unsafe that there is in the world and
unsafe fo- solid and well conducted banks, there
being enough Of the UnsOid and badly conducted
10 fail down OF themselves every few years, and TO
rag down the rest with them The laws put few
restraints OF penalties upon them; and these re-
stralnts and penalties regularly repealed just
often as the community the benefit Of them.
II Is by name in places, and by fact in Others
system Of free banking" which the hard money
Democracy was accustOmedtO call, ''free swindling
Anybody becomes banker that pleases, and issues
small notes and sends them off TO a distance TO be
circulated and lost and to sink upon the heads of
The laboring people. fsvorite plan is to issue
notes al one place. payable at another far off, out of
the way, and difficult 10 be got at, to compel
he holder TO submit to q shave That mode of do
ing business was invented by a Scotchman of Aber-
deem in 1906; but he was in Great Britain, not in
the United States; and the British Ministry and the
British Parliament Immediately took cognizance of
The inventor and his imitatOrs and placed them all
IN the category Of swindlers, aud so put end TO
their operations. No stamp duty, no bankrupt act,
and no requIstion to keep any proportonare amount
of hard money on hand completes the license aud
unb0unded freedom, and the perfect title to perOdi-
cal explosions, which belong to American banking
This last reqUisiton, that Of keeping on hand an
amount Of hard money propOrtiOnate to their abil-
ities seems TO be unknown (even in name) in the
United States yet that requisite is legal and fun
damsntal condition Of the Bank of England; and
the proportion of One-third in gold of the total
amount Of its Liabilities in circulation and deposits
Is The rate enforced; and below that proportion the
Bank Of England does not deem itself safe. Thus
swore Mr.. HOrsley Palmer, Governor of the Bank Of
England, before Lord Althorpes committee, in 1882:
'Ihe acreage proportion, already observed, Of coin
and bullion chtcb be bank deems U prudent 10 keep
hand, IS az the rate Of third Of e total amount Of all
her habalnes, including deposits UeH as ISSUES"
And thus swore Mr. George Ward Norman, direc.
tor Of the Bank "for f state Of The circulation
and dposts, sag trcH-0He millions Of notes and slr
millions Of dPo5its making IN the sOkoLe tOeHty SeUea
Mullins Of liabilities, the proper IN coin and bullion
for he bank 10 retain millions" And TO the
same effect swore other directors. But in Great
Britain il is not sufficient thar this proportion of
One-third is required be ON hand. but il must be
shown, aud that continually, that 1t is there. This
is accomplished by the publication of the quarterly
weekly average Of the liabilities and assets Of the
banks, from which the public can always see when
the bank has crossed the line of safety. How differ
en this from banking in the United States where no
ProPorouablcrate OF specie to the liabilities is even
prescribed; and where FIVE, ten, fifty, an hundred
paper dollars for one hard one in the vault, is fire.