The national era. [volume] (Washington [D.C.]) 1847-1860, 1858-06-03
WASHINGTON, D. C.
For the National Era.
MR CAREY ON THE HISTORY OF OUR CUR
REECY

70 bis second aud thlrd letters, Mr.. Carey re-
views the position taken by President Buchanan
regarding the evils Of paper (c:edit) circuls-
tiop, ard The remedy therefor. He considers
thst tteee views are proved erroneous by the
history of our banking operations, and the
financial disturbances to which this country has
been subject. The plan of his argument is this
To assume a change in the general banking
policy of the country about the year l836-to
refer its previous prosperity and happy freedom
from great revulsious to the first system-to re-
fer the frequent losses and commercial ana man
ufacturing failures to the second. However
striking some of the facts sdduced may be
however much Of laborious research and careful
study they may exhibit-their value in the
argument ceases when this connecting link is
broken. We will endeavor TO test its soundness.
If it fails-though the facts are undeniable-
they only prove and illustrate new theory or
clap."
We take direct issue with the author of these
letters on question Of fact. We deny wholly
that, at any time, there has been Effected
though il may have been contemplated-such
a change in our legislation as forms the grand
point in his series of premises. We deny tina.
there was, at the time to which he refers, any
such action on the part of the National Govern
ment as affected materially and for the worse
the condition of the State banks, flor which be
pleads.) or has caused the recent disturb
ances of trade. From the variety which his
repetition affords, we select the following as the
shortest description of this change: "Such is the
history of banking in the United States since
the peace of 1888, period of seventy FIVE years
du:iBg tie first fifty Of which, the power reserv
ed by the States had been observed-snd that
TOO, most scrupulously-by Washington, Adams
Jefferson, Madison, and the younger Adams
whereas, since that time, there has been an IN
ceasing effort to weaken the States, while
strengthening the Central Power"
This remarkable event-sbout which hither
to we have been in total ignorance-this change,
so pregnant with disaster and shame, happened
about the.yesr 1886, in the Presidency of Jack
son.
Now, we ask, what check from the National
Government is there which at present operates
upon the action of the State chartered banks
There is one. The Independent Treasury, or
Sub-Treasury. When that was established it
met with the greatest possible opposition. 1t is
now acknowledged by nearly ell intelligent and
honest merchants to be valuable safeguard
of our commerce, and most valuable safeguard
of the backs. No one, who is not blinded by
the most mouldy prejudices, will hesitate to con
TESS that there is nought in 1t to weaken the
banks, or make them less safe. On the con
trary, it is true that it is good regulator of q
bad system that 1t discourages the over issue
of notes, and strengthens the banking institu-
tions, and the community generally, in the &C.
currence Of commercial crisis-
At the com mencement of the present revul.
sion the Treasury had about twenty millions OF
specie. Had it not BEEN for this institution,
this money would have been sent to Heather.
dom long since; as IL is. ii has been disbursed for
the pubic benefit. "What intelligent business
man would dispense with the Sub Treasury
Yet we are told in letter No. 3, that the result
of the war, thus commenced" (by the General
Governments the use of circulating paper
have been repudiatedn by it; "vaults having
been constructed in which 10 store the national
treasures,") which has been since followed
up"-ihe result in short, of the Independent
Treasury Bill is seen in the fact that gold
has ceased to circulate, and the Treasury is
drireI, to the use of incOnUertibLe notes" This
conclusion has not the bsrest, slightest founda-
ton. 1t ia true that the Treasury Department
has iesued Its notes; but not ss a result of the
operation of the Sub Tressury-only in spite Of
its partial and valuable protection. How was
II in 1887? The Government could not pay
its own postage bills in specie. Now, long
after the banks broke down, the Treasury con
tinued to pay out millions of real value money.
If it had not been for this institution, the Gov
eminent would have become bankrupt long be-
fore Il did If it had not been fer this institu-
ton, il could not have had the money 30 long
to maintain its payments, for the benefit of the
country-tbus breaking the shock which the
arrangement of the currency caused. So much
for that interference of the National Power, at
present, in these delicate State banking con.
Germs, which, Mr.. Carey thinks, causes all this
commercial distress. Such is the SOLITARY
check imposed by the Government which
simply receives its revenues in specie, paying its
debts in specie-thus keeping the specie in the
country, AID maintaining ahealthy circulation
in part at least. And this check ia clearly most
valuable to the banks. But what has been the
interference in the past, on the part of the Ma
tional Government-what checks have been i'm.
posed-what hurtful, meddlesome laws have
been enacted7 Show them if you can. This
change is wholly imsginsry-the offspring of o
mird intent on corjuring it up from the reccrds
ence in our financial policy. II is true that
Andrew Jackson kicked over the National
Bank. What then The National Bank was
a national check on the State banks-such as
Mr.. Carey most earnestly deprecates It's over.
turn left the Stale banks free to issue their
credit as fast az they could get it out 1t is net
exactly consistent or sensible to cay that the
commencement of national interference, and
the first Of national checks imposed, YVES
a measure which remoced the grestest check
ever imposed by the General Government
and left the banks free to regulate their owr
movements according to the laws of the severa
States.
Surely, Mr.. Carey should glory in this, and
give thanks unto JacksonI Our limited &C
qusintance with American political history
furnishes us with no other occasions in which
the Government has interfered with the right
of the States to charter banks of credit circu
lstion. We do not believe that they can be
found. We believe that this link-which con
meets the steadiness of commercial prosperit,
before 1886, and the fluctuations of our pro
gress siBce-is entirely an invention of the
adversary, mot tie adversary, but Mr.. Carey.
This link might give meaning and valuable
significance to his other premises, as he has
placed them, if it had only proved to be true
and reliable. The fact is, the banks are en-
TREY free-as far as the influence of the Ma
tional Government is conference.-the issue theil
precious, infallible promises, at pleasure, enc
they do it and the argument which is based
on a denial of this, is worthless. We believe
that we have fully exposed, as incorrect, The
conclusions which this "prophet" draws from
history to the effect that the interference of "a,
Federal power has proved disastrous to GU
financial system. OF course, it does not fol
low from this, that the interference of Govern
ment would be bene6cial-that would be tor