Nashville union and American. [volume] (Nashville, Tenn.) 1853-1862, 1857-10-07

- 800. IL $685. $50 sc
dividends, arising from the School Fund Stock in
the Union and Planters Banks, upon the Governor
anu ptroller order, the sum of ffty-nn thous.
and dollars, 1853 O00) which sum has bpan vostod
in six per cent State Bonds and the recent of
the President Of the Bank of Tennessee taken for
the same. ''A0H A0i
AS II VIII become your duty to appoint a Com
mlttee to examine the accounts of the ComntrolIor
and Treasurer, would therefore. suggest that von
direct the same Committee to examine and renort
as 70 the amount received and and disbursed under
the law referred to-
BANKS
In my first two Biennial Messages to the Ta,i.,o-
lures of 1864 and 1866, submitted for Their
consideration the Propriety of putting the Bank of
tennessee and its branches in gradual course of
nquldanon to which Messages YOU are refarrad
1or the reasons and arguments which induced tbp.a
eo1Onlmendatlons. These views were followed ND
ana sustained by the President and Directors of the
Bank, IN their report made to the LegisIatDro Of
iooo-6. The President and Directors. after bav
ing nad the Bank two years under their control
closely observing it in all its practical operations
connected with the finances of the Treasury topetb
er Win the monetary affairs of the State with
great unanimity of opinion recommended that II
would be better for the State and the peopIe gem
orally to win1 up the Bank, or to place If in a
gradual course Of liquidatiOn and in their report
present the following irrefragible facts and arpu
ments in support of their recommendations IN
which ask your earnest attention:
p" The creation of so many new Banks at the last
session OF the Legislature in addition to those that
existed before, produce so much competition he
tween them as will, in all probability reduce the
business and profits Of each to point so low az not
toJustly the continuance of all of them and in the
conflicts likely to arise from such competition an
institution belonging to the State organized as the
BANK OF the State IS at present. is likely to be made
the victim of the selfshness and cunning If otbors
more interested and more sklful in their MANAGE.
ment than inexperienced citizens can be. and "a the
Legislature cannot now recall the charters granted to
others, the Directors have come to the conclusion
with great unanimity, and from settled eonviction
that the best interests of the State REQUIRE Il that
the Bank Of Tennessee should be put in liquidation
anu us concerns closed at as early period as the
convenience of the citizens will allow.
6 That nonresident stockholders sbouId bava No
control over the moneyed institutions in this State
they have no interest in common with the people
and no sympathy for them in times of distress. their
interests are indeed often antagonistic Their in
Vestments In our stocks are made solely with view
to the percentum derived from them and their con-
troll OF them will be solely with view to the profits
that can be secured by them. That dealing in the
circulating medium of the State, whether of the
precious metals or paper currency, which regulates
the value OF property and the price of the produc
toms OF the State should be prohibited as far as the
Legislature has the authority to do SO. The citi-
zens have too deep an interesin the amount as well
as the quality of the circulating medium by which
the trade and business of the country is carried on
TO allow any intermeddling with it by stockholders
spectators, brokers' or bankers turned brokers.
The Bank of Tennessee was established for the
purpose of creating a fund for Internal Improve
ments, and to aid in the establishment of a system
of education
" The operations of the Bank in a few years seem
to have convinced the General Assembly of the i'm
pracuollty of accomplishing the great objects of its
creation under the organization which has been Civ
en- IT. and an act was passed in lS49 directing the
profits Of the Bank to be paid into the Treasury and
the payment of the interest on the Bonds of the
State and the School Fund to be made BY the Treas
ury; by that time million of dollars had been
taken from the capital by appropriations of the
Legislature, and the debts lost by the Bank By the
act OF the Sd Of March, 1854 the annual profits of
the Bank were directed to be applied to supply the
deficiency OF the capital oocasoned by the bad debts
SO that the Bank cannot be regarded at this time in
any other light than a financial project to aid the
Treasury of the State. 1t can scarcely be doubted
that an investment of the School Funds composing
IN part the capital of the Bank, in the bonds of the
State, bearing an interest of six per would have
been more wise and judicious disposition of them
than IN the Stock Of any corporation yielding nomi
naly two or three per cent mOre and especially in
one which was subject, from its organization to all
the casualties arising from the change Gifts officers
every few years, as the the other party pre-
vailed in our elections and to the careessness neg
gence or frauds of those controlling it, The other
portion of its capital belonging to the State mil
lion of dollars obtained by issuing bonds of the
State bearing six per cent interest, and upon which
the State now pays interest, and will be compelled
to pay whether the Bank yields profit or not
- From the operations of the bank heretofore
there is strong reason to apprehend that losses of
similar character may hereafter, and that the
profits by the time the charter expires may DO re-
quired to reinstste the capital now required by
the act of 1854. Under such circumstances it would
seem to be the true policy of the State pay the
million dollars for the bonds of the State whilst it
has the means under the control Of the bank and to
invest the school funds in other bonds of the State
bearing interest, and thus avoid the hazards incident
to borrowing money to be reloaned under the control
of any corporate body The public is seldom bene-
flied by such financial schemes.
"If the money has to be paid by the citizens, it
makes but little difference whether it be done |
through the Treasury or by the profits discounts
and loans made to them through such a corporation;
the direct the mode adopted the better gener-
ally for the citizens 1t is, in the opinion of the /
Board of Directors, no Unimportant matter to avoid
the danger seriously apprehended by many, of sub
ecting the citizens to taxation for the payment of
the debts created for the establishment of the bank
when would be the case in the of any serious
disaster happening to it, before the expiration oft
charter. The fund now belonging to the State and |
now in Bank, will go far toward extinguishing the /
present Indebtedness of the State. The present |
lime seems more favorable for the accomplishment
Of this object than any other for years past or than
nay be expected for years to come. The circula-
ion of this bank is now less than it has been for
years, and if withdrawn its place will be at once
supplied by the numerous banks now in operation
md its loss will be scarcely felt by the community
ar hos hao 20 b1os
great interests the State than for many years. and
he surplus products will enable the debtors Of the
bank to meet the demands against them without SER
Gus embarrassment, if a reasonable time be allowed
or that purpose.
''By closing the concerns ofthe bank, an end will
De made of the competition for making money be-
ween the State and Its citizens, and especially
With those corporations in which it has so large an
Interest," such contests always result in the loss of
Money as well credit to the State and the excit
ng contests for the control of its capital which is
Witnessed almost at every general election, will be
wooded"
This report of the President and Directors, of it
elf seems almost conclusive uTOn the subject, well
high superseding the prOprie:y of offering any thing
more in addition to what they have said. The ne
essity and expediency of longer continuing the
Bank as fiscal agent of the Treasury, or, con-
enience for the people in their monetary affairs,
would seem, after reading the able report made by
ne fresldenI anu directors OF INC DAnA, an uJ'er
.bsurdity; and it should be dispensed with, and
hereby all connection between the State and Banks
'e dissolved. To carry the business of Banking
s not of the objects for which the State
ted, no more than it to go into the pursuits Of
agriculture or Mechanics. 1t was not desi med by
hose who framed the Constitution of the State of
he United States that the State should become Ell
her Bankers, or Brokers, or Money Changers in any
ense of the term, to make any thing a tender in
ayment of debts except gold and silver. This is
he currency intended by the trainers of the COnsti-
ution of the United States and of the States for the
eope. 1t may be assumed that this great principle
as never been violated, so as to come in conflict
With the letter of the organic law of the land but it
as been violated in spirit and practice since the
ton Of the first Bank in the State and the people
ave been m9ds the sufferers in the end, by every