The Feliciana Democrat., 1858-03-13


vantages, the former arc certainly entitled to
no superior consideration at our hands over
the latter.
10 what is it we are indebted for even the
comparative safety and efficiency of any of the
banks at this time, but the stringent and salu-
tary provisions of the laws that govern them
Remove these restraints repeal these laws, cut
loose all limits to their movements-to their
Inherent tendency to expansion, speculation,
and excess, and explosion, distress and ruin
would, sooner or later, be the inevitable result
The same restraints demanded by the safety
and welfare of the community against the er-
rors and improyidencc of one is equally re-
CURED for ALL If dozen are, from the in
herent instincts of The system, dangerous to
the public, one is equally so in like proper
! ton. If, on The other hand we can, by pru-
dent legislation, restrain one from the iniliction
of injury upon the public, can We not, in the
same manner, by the same laws, 10y the en-
forcemcnt Of the same severe penalties, re-
strain u dozen? Also, under the present laws
| for the government of the banks, they are re-
quircd to keep on hand at all times, specie to
the amount of one.third Of their circulation,
and to have twothirds of their loans in short
paper In this respect they all occupy the
Sulllc STOuU'l, ullu '.lSy utft uh tuNhlly
lated this law That these guarantees are in
sufficient TO protect the public interest, all past
experience proves to be but too true. The old
United States Bank was considered, in its day,
the most safe and efficient bank in the world.
The sequel Of its history proved its utter in
solycucy and ruin. So with the whole bank
ing system of the country previous to lS40 /;
producing in their explosion and overthrow,
ruin and dcsolaton over the country. Again,
in 1851 the almost entire system proved to be
insufficient to meet the cxigcncy; clearly show.
ing that the ordinary assets OF u bank, III
times Of great pccuniary cmbarrassmcntS, con
stitute very insecure guaranty to the public
against loss and injury But the Free Banks,
as an additional security to the public against
injury, are required to place in the State Trea-
sury State bonds at par value to an amount
equal to the amount Of bills they are author
lied to circulate; nor can they, under the law,
circulate bills to greater extent; and should
these banks fail to pay their circulation, or
meet the demands against them, creditor can
secure payment from the sale of these bonds
This evidently makes the creditor Of The
banks created under the Free Banking Law
ultimately more secure thau the creditors Of
the Chartered Banks, whose creditors have no
such indemnity secured to them, and in The
custody of State officer For should
commercial or pccuniary crisis in the country
occur, deprcciating the value Of State bonds,
would not its influence first affect and mate.
rally dcprcciatc the notes and assets Of the .
banks? And if it should at any time become
necessary 10 force sale Of these bonds dcpo.
sited in the State Treasury, TO pay the credi-
tors of the banks, would it not be supern-
duccd by the reckless and improydent conduct
of the banks and in such an event their ere
dts and resources would constitute n poor re-
lance to meet their engagements certainly
much inferior to the guaranty secured by the
Free Banks in their deposits Of State bonds.
Thus, under every consideration that we
have been able to give to this subject, we are
constrained to believe that the character and
condition Of the banks created under the Free
Barking Law, afford guarantees at least as
secure as those of the Chartered Banks to
their bill-holdcrs, as well as to the public
generally
If therefore, as is maintained by the maio-
rity, that banks OF circulation arc demanded
by the public interest, and shat il is the set
tied policy of the State thai we should have
them; and as the principles upon which the
Free Banks are created are more Just and
equitable (being equally safc,) as well as more
in conformity with the principles Of culigh,
tened progress, characteristic of the age, we
are constrained to withhold our approval to
the recommendations Of the Committee on
this subject.
But the undersigned conceive that tile Le-
gislature has paramount and solemn duty to
discharge, in providing such laws as will fully
and cl'ectually guard and protect the people of
tie State from all injury tlat may result from
the conduct or action Of those who have, or
may hereafter, embark in the business of bank
ing.
In the absence of banks, in the ordinary
business transactions Of life between indy-
duals, credit is the voluntary act Of the party;
but with banks having q paper circulation
cheaper, and consequently superceding specie,
in every trade, in every transaction, by which
we dispose of our property or labor, the great
Inconvenience resulting from refusing to take
this paper money amounts virtually tc a com
pulsion; and hence, from the necessity of the
case, we become an ingolun tary creditor to
the banks. Whilst | hold a bank-bilI the
bank is my debtor; my credit is forced from
me by necessity which | did not create; |