The Cadiz Democratic sentinel. [volume] (Cadiz, Ohio) 1854-1864, 1858-01-13

onstrated however, that the greatest financa
disasters in Ohio have not been occasioned b.
legally authorized banks ofisSue. Most Of tn
calamities which have recently fallen upon tn
business community ofthis State, have origina
ted in the failure Of private bankers and Of th'
Trust Company, issuing no notes for circula
ton. Many of these bankers, and perhaps tht
Trust Company also however, were borrowers
from banks outside ofthe State, of foreign notes
at low rates of interest, obe circulated in Ohio
and redeemed, when returned to the issuing
banks, by the borrowers. The effect of thcst
arrangements was to introduce into the State
mass Of foreign bank paper which expelled from
circulation not only nearly all the coin, but alst
nearly all tie notes Of our own banks, and ex
posed the community to great inconvenience and
loss. suggest the expediency ofso modIfyins
the act of February Oath, 1913, relating to the
circulation of unauthorized bank paper, as tC
prevent efectualy this mischief Additional
protection to the business community, as well as
substantial benefits to the sound and strong
banks themselves, would result from the es.
tablishment ofa Clearing House in Cincinnati
for the banks of ohio, Kentucky and Indiana
either through the voluntary action of the In
stitutions concerned, or by the concurrent legs.
ation Of the States.
In a former communication to the General
Assembly, while admitting the convenience of a
mixed currency OF coin and convertible notes
and the improbability that currency entirely
ofcoin will soon be adopted in the country,
expressed my opinionin favor OF a currency oI
coin for ordinary transactions and Of large notes
for the convenience of commerce, and at the same
time urged the necessity ofthe most stringent
legislative guards against suspension of specie
payments, and against mere paper money sys-
tenn. - se'fssy i
Subsequent reflection and observation have
have confirmed me in these views.
A leading object in all regulation Of currency
should be to secure the interests OF the masses OF
the people, by such provisions as will ensure to
labor just compensation in actual value. This
cannot he effected while the laborer is paid in
paper, subject to oeontinual huctuatiou, and ex-
posed to all the hazards Of financial disorder.
Whatever can be constitutionally effected by
State legislation, towards the exclusion Of the
smaller denomination of notes for circulation,
and the substitutlonof coin in their place, should
be earnestly attempted. The quantity of coin
in the country is now SO great, and steadily in
creasing, that no injury and almost no ineonvr-
nience could arise to, any interest from udiei
Gus legislation for this object. On the contrary
it seems to me certain that the increased croula.
ton ofcoin which will thus be secured, cannot
fail to result in NEST substantial benefits 10 all
interests. by additional securities against Anctua
tion and revuls on. These benefits seem to me
so obvious that Ishould hope ior the assent of
banks themselves to the legislation nesessary to
secure them. Without that assent, under the
decision already referred to, such legislation
n l., al 4
under the act of ,I845&s4 !. lsl. 3 .-,..1e..
The existence of this decision, the uncertain
ty Of obtaining that assent, the fact that we are
surrounded by States. whose banks issue such
notes, and the practical difficulty Of excluding
the notes of these banks from circulation in Ohiu
created the apprehension have heretofore ex.
pressed, that comparatively little can lie accom-
plished in the direction OF the proposed reform
10y State legislation. These apprehenslons yet
remain. The etiectual remedy is with the Fed
eral Government. Looking at the manifest in
tent of the Constitution to protect the people,
from the evils of paper currency, as well to the
specific powers granted to Congress, cannot
doubt the power Of the National Legislature TO
prohibit the circulation as money any substitutes
for coin. Nor can doubt that the exercise of
that power by prohibiting notes Of the smaller
would be wise and salutary.-
The denial Of this power virtually submits the
regulation ofcommerce in its most important
to the variable and conflicting
policies OF thirty one States, and defeats one Of
the main purposes Of the Constitution.
Entertaining these views, have observed
with regret the recent declaration of the Chief
Magistrate Of the United States, that 'the Fed
eral Government cannot do much TO provide
against the recurrence Of existing evils,n and
that I'VE must mainly rely on the patriotism
and wisdom of the States for their prevention
and redless.' Such declarations especially
when accompanied with a Recommendation Of
the issue by the General Government Of large
addition to the. mass Of paper currency in the
form Of treasury notes, are calculated to Illustrate
the hopes to reform, which might be otherwise
entertained. While do not doubt
that the General Assembly will do whatever
may be within its constitutional power towards
the object proposed, | esrectfnlly submit that
its whole duty will not be performed until this
matter be commented to our Senators and Rem
IN Congress by appropriate resolu-
ITEMS 7.'l la itaa4
An act to incorporate new hanks having been
twice submitted to the people in different forms,
and having twice failed receiving the popular
sanction it may now be properly considered as
settled that the majority of electors do not de.
sire further creation CONSTITUTIONS OF the charac-
Ter proposed see no reason, indeed, especial
ly il smalrrotes be once excluded from circula.
ton, which the business of banking may not be-
safely leftas open and free to allwho desire to
engage init, as any other kind of business, care
being taken that ample securities be given in
bonds Of the State or the United States and by
the provision Of an adequate specie fund, for the
prompt redemption OF notes in coin. Bank
notes circulating as money are debts due the
community at large, payable on demand, and it
Il the duty of the State representing the com
munity, to see that these debts are perfectly se-
cured. Such securities are indispensable; and
| respectfully submit to your better judgment
whether the experience of the last few wears
does uotsuggest the expediency Of requiring sim
liar securities or at least providing efficient guards
ofsome kind, insuring prompt payment of depos-
its for safe keeping. 5s a fg M ss
The condition Of the State Treasury requires
prompt attention, .,e.
On the 10th Of June last, William H. Gibson,
the then Treasurer OF State, disclosed to the
State Auditor the existence of deficit in the
State Treasury to the amount, as he stated, of
about 551 600 dols occasioned, as he alleged, by
the defalcation Of John G.. Breslin, his immedi-
ate predecessor. Atthe earliest practicable mo-
ment this information was communicated to me.
Unto this time had not entertained the least
suspicion that Mr. Breslin had failed to pay over
10 his successor the whole amount ofpublic mon
ey which had come to his hands, except the
sums reported by him as deposited with failed
banks and bankers, or retained by him under
claims for exchange. The repeated declarations