Daily Iowa State Democrat. [volume] (Davenport, Iowa) 1856-1859, 1857-11-28


" written an able and characteristic
letter on the panic, and the causes
which produced it. He says that 1.-THE
only solution Of the catastrophe is the
failure ofbad banks and the consequent
run which their failure made upon the
good ones the insolvent pulled down
the solvent" Had the plan proposed
by the hard-money democracy twenty
years ago been followed, We would not
see the business Of the country disor-
dercd, deranged and thrown out of
joint in season Of peace and prosper
ity. Gen. Jackson cndeavored to res.
tore and preserve the hard money cur
rency, which the trainers of the Con
stituticn-who were hard money men
had, as they believed, secured to us.
The plan Of that restoration consisted
in five parts, namely: l. To revive the
gold currency by correcting the erro-
neous standard Of 1901. 2. To create
demand for hard money by making
1t the exclusive currency of the FEEDER
al treasury. 3. To make sure Of this
hard money by keeping it in its own
treasures. 4. To suppress all paper
currency under twenty dollars by
stamp duty. 8. To wind up dcfaulting
banks by a bankrupt law against deln-
qnents. The first three of these five
parts were accomplished, and to these
we are indebted for twenty years ex-
emption-from 1897 to ls57-from
bank suspensions, and deprecated cur
rcncy; for carrying the country through
iorcign-the Mcxican-war without
paper money, and with public sccuri-
ties above par; for having in this coun-
try at this time fifteen times AZ much
hard money as We had in the time of
the United States Bank and we are
indebted to the want of the two latter
parts of the plan for the melancholy
prostration of the business community.
A stamp duty on their notes, and a
bankrupt process against themselves
would have saved the country from the
calamitics which it now endures: for
many of the base banks would Lave
been unable to make currency for want
OF money to pay for stamps on their
notes, and others would have been
proper subjects for the bankrupt pro-
cess IN the first few days Of their cxis-
tcnce. For the defeat of these two
parts last alluded to, the paper money
wing Of the Democratic party is res
ponsible.
Col. Benton censurcs very severely
the banking system which exists in
many of the States. He says "therc
is not monarch in Europe who would
treat his subjects, as the people of the
United States are treated by the base
part of their own banks, and the indul-
gent legislatures which lcgalize their
violations of law, promises and con-
tracts" He declares that it is neces-
sary for Congress to carry out in full
the two parts Of the Jacksonian plan,
which has hitherto been defeated, and
to require, in addition, that banks shall
keep on hand an amount of hard mon
ey proportionate to their liabilities
that requisite is legal and fundamen-
tai condition of the Bank of England,
IN which the proportion of one third
IN gold to the total amount of its liza
bilitles in circulation and deposits, is
the rate enforced. This proportion of
one third is not only required to be
on hand, but it must be shown and
that continually, that it is there. How
different is the banking of the United
States, where five, fifty or hundred
paper dollars are issued for one hard
dollar in the vault
Col. Benton then proceeds to show
the evils Of small paper money-evils
which the republic have learned from
sad experience. He then comments
with much force on the objection urg-
ed twenty years ago-that there were
not gold and silver enough in the world
carry on the business of the United
States. The answer to that W; $, that
there was precisely enough and that ex-
actly enough would come to the United
if we would only create a demand
for it, by correcting the gold standard,
make 1t the government currency, and
by supprcssing small paper. Though
only part of these things Lave been
done, there has flowed into the United
States,or been obtained from. our mines,
about four or tives times as much
gold as the Union can employ. The
supply has been one thousand millions.
and the business If the United States
only employs two hundred millions.
This Is not guess work, but bottomed
IN nm authont;r 1o<o g., 81 =,