The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1857-11-01
Banks, and the Reforms that are Needed In
Them.

We request all persons Interested in the
banking and currency systems of the country
to read the articles which we publish elsewhere
from the Philadelphia Ledger, on the subject of
banks and banking. They will there learn that
the ancient Bank of Pennsylvania, which has
fourshed so long and so invariably led the
race of suspension whenever there was
chance of doing so, is utterly insolvent, and
will be forced to go into liquidation, "leaving,"
in the words of the Philadelphia journalist, las
little for its shareholders as its great prototype
the Bank of the United States.' They will
also learn that, on an investigation of the books
of the concern, it appeared that eight of the d.
rectors of the bank held but egytpo shares of its
stock among them; having evidently lent
their names to the bank and enjoyed the privi-
lege of directing its discount operations with
out the least idea of risking any portion of their
capital in its stock.
From this one example we may learn the ma
ture and character of one half the banking and
corporate monetary institutions throughout the
country. We have no hesitation in saying that
if all the LOGO banks of the United States were
examined to-day rs thoroughly as the Bank of
Pennsylvania has been, very large
proportion of them would be found to
be as unsound as that institution; and
the history of many, as told in their
stock ledger and discount books, would reveal
an equally disgraceful record of imposturc
and dishonesty. Men who are honest and up
right in their private dealings as individuals,
VIGOROUSLY lose all thought of honor, oil idea
of integrity, all concern even for responsibility
when they are associated together in corpo-
rate institutions; they will cheat, deceive, de-
fraud the very humblest of their dependents
even. SO long as the fraud is chargeable di-
rectly on the corporate concern, and only ulti-
mately on the individuals composing 1t: and of
all corporate concerns which are liable to be
swayed by corrupt purposes and dishonest mo-
tives at the present time, there are none with
such temptations to evil, and such opportunity
for mischief a. the banks. 1t therefore behooves
the Legislatures of all the States to afford to
the public the largest measure of protection
possible against the banks.
In Pennsylvania, a special session of the
Legislature has so far repealed the law as to
rescue the banks from the otherwise inevitable
consequence of their suspension of specie pay
ments. In this State the Judges of the Supreme
Court, in consideration of the emergency, took
the responsibility of multiplying the law, and de-
priving the Legislature Of its vocation. In
other States other shifts have been resorted to
with view Of screening the banks from
the legitimate but disastrous consequences
of their failure to perform their duty
to society. In every case the difficulty
has been surmounted But also in every case
the purpose of the banking laws have been de-
feated, the public has been disappointed and
foreigners have been encouraged to sheer at
American contempt for law, and the laxity of
financial obligations in the United States
II il evident that some legal steps should be
taken to obviate the recurrence of accidents so
injurious to ourselves and so disgraceful to all.
Every one is currency doctor at the present
time; but We have not yet seen a broad feasible
scheme for the equalization ard assimilation of
the currency Of the various States througu out
the country. Such system as this, by which
the money Of every. State in the Union would be
of par in New York would obviate great
amount Of mischief--not only such mischief as
occurs ON the occasion Of panics and financial
revulsions like the present, but the trouble that
il being constantly caused In the best of times
by the failure Of recognized banks which seem
to he sound and command the public favor, but,
one day, suddenly collapse and disappear, no
one knows why or how Under general law,
or system Of uniform laws, regular weekly
statements could be exacted from every bank in
the country; and, with Clearing Houses in every
large city, no such catastrophes as that of the
banks of Pennsylvania could occur.
Until we have general law, indeed, neither
bllholders nor depositors can ever be consider
cd universally safe.
RENT DAY IN THE HARD TMEs-Wc have