The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1858-06-07

TIA Proposed General BanAs~z4 Lsw-Rs-
port - ehs Cemn.assss.
The Committee On the Judiciary, to whom was
referred the recommendations of the Presidents
Message on tho subject Of general Bankrupt
law. has made report strongly adverse to them.
The conclusions of this document may be thus
briefly stated: That the Congress of the United
States has no power under the constitution to
subject banks to the operation of any Bankrupt
law on the mere ground Of failure to pay their
liabilities on demand In specie, and that the ex-
ercise Of any such power would infringe upon
the rights of the States.
In trying to sustain these conclusions the COM
| mittee have resorted to vast amount of special
| pleading. Not contented with arguing tho
| question ON technical grounds, they have alss
entered into long financial disquiition to
| prove that the banks were in no way to blame
| for the late revulsion. This elaborate defence
of the action of the banks previous to the crisis
forms curious prelude to the political argu-
ment. 1t looks as if the committee are con-
soious of the weakness of the grounds on which
they are about to resist the constitutional right
| vested in Congress, and seek to strengthen them
| by statements deprecating the necessity for its
| exercise.
Curiously enough, in the effort to fortify
themselves by extraneous assumptions of this
kind, they unconsciously make out the case infer
red by the Presidents recommendations They
state that there is not only a total absence Of
uniformity in the remedies provided by the diff
ferent States against defaulting banks, but that
| in the absence of any such remedies there is no
power in Congress to provide them. Thus they
| admit the full extent of the Inconvenience and
hardships to which creditor is at present ex-
posed in the endeavor to establish his just
claims against an insolvent or fraudulently dis
posed banking cooperation.
1t was to correct this unjust and anomalous
state of things that the President recommended
the adoption of uniform Bankrupt law, ex-
| tending to banking institutions as well as to
| individual traders. But, say the committee,
| Congress has no power under the constitution
to pass any measure which would make it the
| irreversible organic law Of each banks exist
ence, that suspension of specie payments shall
produce its civil death. Although the PROPOSE
ton thus strongly stated is not what the Presi
dents recommendations contemplate, in order
to cut short the argument we accept it in its
| most exaggerated sense. We assert that, under
the provision of the constitution, Congress does
possess this power, If il chooses to employ it,
just as the exercise of q Discretionary right in
| fers the possession of q more arbitrary one.
The attempt to reduce to an absurd conclusion,
by such reasoning, fact 80 clearly to be in
ferred from the very wording of the constitu-
ton, betrays, we think, the inherent conviction
entertained by the committee of the weakness
of their position.
That the trainers Of the constitution never
contemplated excluding banking institutions
| from the operation Of the bankruptcy laws
which they empowered Congress to pass, is evil
dent from another fact-namely, the prohibit
| ton which they imposed against the issue of
paper money by the States. No constitutional
| doctrine is more firmly established than that
nobody can delegate to others powers which it
does not itself possess Now, in granting to
banking institutions the privilege of making
paper issues, the States have clearly transcended
| the rights reserved to them. The distinction
that is sought to be established by the commit
tee, between the paper money of the States and
the paper money of banking corporations, is a
fallacy rendered only the more ridiculous by
their respective values. Inamuch, therefore,
as the States governments have exceeded their
powers In the authorization Of paper issues by
banking institutions, there can be clearly
no Infringement of State rights in the
sense commended for by the report
The very restriction itself proves that the con
stitution intended to reserve to Congress, as .
measure of imperial policy the power to deal
with banking institutions as with individual
| traders
A more hippant, ill-reasoned or illogical docu.
ment than this report has never, we will ven
ture to say, emanated from any congressional
| committee. Nothing is said about the vast in
terests endangered by the Diversity Of State
| legislation on this subject-nothing about the
absence of any adequate Legislative remedy at
all As IL stands, the report might In fact be
taken for the er pore statement of case got
| up by pains taking counsel for wealthy oil
ent. Had che great body Of creditors through
| out the Union subscribed amongst themselves
to get up 500, 900 lobby, after the fashion of
the free wool men, the iron manufacturers and
the patent monopolists, the result might have
been very different. With little judicious ear
wigging on the part of insinuating and persua-
sive agents like Messrs. Matteson and Corbin,
the conclusions of the committee might have
been Is strongly in favor Of the general int
rests of the country as they are new dead against
| them.
NORTHERN vs.. SOUTHERN Law AND ORDER
| PEOPLE IN GLASS HoUsEs.-ThAt wise old saw
which says that ''pesple who live in glass houses
should never throw stones" will apply very
we'll inst now 10 those eQntistical Southern iour-