The true Democrat., 1857-04-14
From the Nashville Union.
BANKS AND BANKING.


 ing. We believe that banks have done serious injury to the great mass of the people, ard that the injury is in proportion to the number crea- ted. We refer back to the time when our leg islature gave every body the privilege to bank, and soon thereafter the country was Hooded with Kincannon tickets, Chaffin, Kirk & O., shinplassers, and others of like material All these, like the mcrus multicalis, became worth less, except as fuel to kindle morning 6re Subsequently tte Farmers and Merchants Bank of Memphis was chartered. Then came the Bank of East Tennessee. The next birth in the bank family was named the "Lawrence- burg Bank" The legislature of l851-2 char tered the Citizens Bank, and passed general law allowing any person baking privileges who would deposit S5O,OO0 in bonds with the comp troller. If the legislature following had looked back to the condition of the banks chartered by thelr llustrlous predecessors, and made all eSti- mate of the loss sustained by the hard working people in consequence of bank failures, surely they would have waited while to see what tax the people could stand before burthening them with any more banks. But there was not yet stopping place. After the adjourn ment of the legislature of 1853-4, (the same body that made JOHN BELL senator,) we find on the statutes, charters for eight more new stock banks. Three of them--the Mechanics Bank at Memphis the Central Bank at Nash vile, and the Miners and Manufacturers Bank at Knoxville, have failed. Two otners--the Bank of West Tennessee, at Memphis, and the Agricultural Bank at Brownsville, are said to be shivering in the chilly breeze of diversity. There was yet DO stopping place. Although John Bell had failed politically and the three banks above named had failed pecuDiarly, yet with all these evils staring them in the face, the legislature of 1855-6 chartered the Bank of America, with the power to establish two branches and the privilege of increasing its capital to one million two hundred thousand dollars, and to issue two dollars for one of capi- tai paid. This same legislature seemed, by their action, to be of the opinion that there had been rather loose way of banking in Tennes- see, and they passed an act requiring all the banks and branches to make semi annual re- ports to the Governor, and that the branch bank reports should be "separate and distinct from the return of the mother bank" But not one single branch has complied with this act
 Cit may be proper here to remark that the act makes an exception as to the State Bank, and that the Bank of America, Union, Planters and Citizens Banks, are all that have branches- Even the Bank of America chartered at the same session which required branches to report to the Governor, had paid no attention to this act. The same act also prohibits any bank or branch bank from having circulation which shall exceed its discounts more than S2OOO" If the branches had male reports as required by law, the people could see and understand the practice of dodging the payment of their debts by giving the people of ClarkSville notes payable at Rogersville or Dresden, and by giv- mg the people of Nashville notes payable at
 Atf. D.,l. l.. N we ask the reader to run over the list of banks named ia this article and estimate if he can the heavy tax sustained by the people in conse- quence of the failure of banks created by our legislature from the days of kincannOn to the present. tune. On whom has this loss fallen? Even at the risk of wounding the feelings of VI hat, in refined circles, are called commercial men," we say that the great injury done by the breaking of a bank is done to the farmer the mechanic and the day aborer. | Iou rarely see commercial man" with broken bank money on hiS hands He Is IT ght al the door of some bank where he can deposit such funds as will not get hiin exchange to pay his northern or southern debt--he can deposit every day. and the next day the meanest money he has de- posted Is pad out on his check to the farmer Tor hs cotton, corn, or other articles of trade, and to the mechanic for labor done on his house or steamboat. But suppose the bank breaks where the :" commercial man " keeps his account: don't he lose then? In nine cases out of ten, not a red, but ofteuer makes by the fail ure; for he generally has note or bill m the bank, and he checks for the deposit to be ap- pied to the payment of the note or bill and often has chance to buy up the notes of the heavy discount to take up his own paper If he has no note of his own. he knows of d friend who has, and he will work in his brokep bank deposlte. The only way these commercial men" lose by bank failures is when they be- come too knowing and buy up bank notes when the bank is going down hill and are caught ln their speculation.
 We think 1t clear that banks have greatly
 injured the people pecuniarily. We go further: With the single exception of hypocritical know nothing clergy, we think banks and bank ing are far ahead of any thing in injuring the morals of the community. They do every thing in their power to avoid paying their debts For instance 4 cotton specuator draws bill on his New Orleans merchant for Sl0,OOO. The bank discounts the bill. On looking over the money he has received for his bill he finds that
 1t IS all payable at Jackson, or Pulaski, or Ores den. lie goes to one of these points to make his purchases and finds that by paying gold he can purchase at a lower price; so he goes to the branch bank and gets the com. The cashier is mad because he had to pay an honest debt, and he immediately writes to the parent bank, tells what notes he redeemed and what sort of man presented them. When this letter reaches the parent bank, there Is a whsl leriug between the president, cashier and teller, and the iden- 1 tJy of MT. Cotton specuator is fixed. Do you suppose he could ever get bill discounted in that bank again? Not bit of it. Why? Was that bill he drew not paid? Oh yes, the cotton spectators bill was met promptly; but the bank dId not expect to pay their notes. And because the bank was lot successful in avoiding the payment of its notes, it will have no dealings with the man that makes 1t pay.
 But again: Banks injure the morals of the people by giving character to the paper of other banks which they believe to be unsound, and if banks can do this thing the example is apt to be followed and the fraud become general. For instance: new bank is started without capital. The first object is to get out a circu- lation. The little kitten has opened it's eyes 1t begins to craw wl--its owner has ma le arrange ments at Knoxville, Nashville and Memphis. that whenever the youthful "varmint' gets into either of these large cities 1t shall be pro- tected." The farmer and mechanic seeing that It Is protected by bankers conclude to let it paSs-lt goes all through the State--t has grown to be large wildcat. Its owner meets 1t every day, huge bristling monster-it be- comes exceedingly troublesome. The owner hn's 1t has grown too larye its claws are too long for him to "protect' any longer, and he has concluded to "let her rip." The conse- luence is, that the owner and its protectors drYelt away and 1t continues its rambIes to the country, and neither the owner nor his friends | mi, h, fl,n do, { !. wildcat. Such was pretty much the history of the late Central bank. Bankers know that the principal owner hal been largely engaged in northwestern banks, and it was stated in bank note Reporters that every bank with which he was connected had failed. Yet all he had 70 do when he bought Tennessee charter was to make arrangements to have his issues protected in our principal cities. Letters were written to us to kuow tLe character of the bank and our rn