Bedford inquirer. [volume] (Bedford, Pa.) 1857-1884, 1859-01-14
VOL. 80, NOS

the continuance of the charter may be iujuri-
oua to the citizens Of the Commonwealth Any
other construction of the constitutional reser-
ration would make the interests and safety OF
the public subservient TO the gain of the pri-
vate stockholder Believing, therefore, that
there is no want of power, cannot refrain
from expressing my decided opinion, that when
ever il IS clear that bank is insolveRt, or iIi
great danger of becoming so, or whenever its I
privileges are so used or abused as to serious
ly prejudice the interests of the public, il is the
duty of the law-making power to protect the
people, BY destroying its corporate existence.
In this connection | deem il my duty TO re-
iterate the views expressed in my inaugural adj
dress. | tLen stated, as my decided opinion,
that there should be no further increase of
banks or bankias-<aI4ki undcr the present sys-
of notes of saizEl denomina ation-and recon-
mended such a change in our laws relative to
banks, theirso@gAnzatiou and management, as
would at Least Secure beyond all question the
prompt redelftioh Of all bills or notes put in
circulation byEhe several banking institutions
of the Commonwealth.
Well satisfied of the imperfection Of exist
ing laws relative to banks aud banking, | deem
| cannot give the Executive approval TO any
bills chartcIng additional banks without rad
isal change in the entire system Ii is but Just
to state that in my opinion large majority of
the banks of the Commonwealth are well and
safely managed and in perfectly sound con-
diton; but this is due to the honesty and intel
ligcnce of those having charge of them, rather
than to the efficiency of the laws. Under the
management of incapable or dishonest men, ex-
perenca has shown, that there is really but lit
tie if any security to the public in the regula-
tious and restrictions now to be found in our
banking code. True wisdom dictates refor-
nation.
The ruinous losses which have fallen upou
| the people during the financial pressure of the
past eighteen months, suggest the necessity of
preventing their recurrence. Although manE,
causes may have combined to produce tie
disasters, it is too plain TO admit Of doubt
| our banking system has been one of the a1p62t
prominent The value of the precious msta1s
tile prices of property and the wages Of la
b6r-are always affected by the abundance or
scarcity of the paper medium received as a sub
| stitute for gold and silver coin. The power of
tths States to authorize paper currency thro'
aud acknowledged throughout the Union, and IS
no longer an open question. But it must be ac-
knowledged that the power has been greatly
abused. The delegation of this attribute of
sovereignty to number OF irresponsible cor
poratous, without proper checks to limit its ex-
ercise, and without providing any security
whatever for the redemption of the issues thus
authorized, has been attended with evils of the
most alatming character. These corporations
are practically made the exclusive judges of the
amount of paper currency to be furnished 10 the
people, aud have the exclusive power to con-
tract or expand their circulation at pleasure
Depositors and other ordinary creditors of
banks, need no legislation for their protection.
Every one who has direct dealings with these
institutions, either as depositor or otherwise,
enters into such engagements voluntarily, for
his own advantage, and may be safely left to
his own vigilance, and the ordinary remedies of
the law, for his protection. But the millions of
people engaged in Industrious pursuits, the
farmer, the mechanic, the merchant and the Ia
boring man, are under an imperious necessity
to receive for their merchandise and their labor
the ordinary paper currency of the country. 1t
is impossible for persons of this description to
| investigate the concerns of every inatitution
whose notes are in circulation. But no inves-
tigation could save them from the losses arising
from the defaults and frauds OF bank officers
and the insolvency of bank borrowers
The note holders of banks havo peculiar
claims to the protection of the government.--
They are involuntary creditors, who are forced
to receive :he notes authorized by the govern
ment. They have no direct dealings with the
banks. They do not trust the banks from any
hope of gain. They have no profit IN passing
the notes which they would not have had in
passing gold and sil7er coin. They constitute
almost the entire community, and the humble
and Ignorant are always the greatest sufferers
when bank fails to redeem its notes. The
people are therefore deeply Interested in the
security of the circulation allowed by law, al
though many of them may never have had
share Of bank stock or been within hundred
miles of its place of business. The Govern
ment that authorizes the issue of a paper cur
rency is under high moral obligation to re-
qire ample aud available security for its re-
demptloD.
The certificates of Joan issued by the GEN.
eral Government, or by this Commonwealth, at
a value to be fixed upon, with the power to re-
quire additional desposi.s of security, from time
to lime, as the loans depreclate in the market,
would De safe and available as any guaranty
which could be provided.
law requiring all issues of banks hereafter
organized, to be secured by the pledge of these
loans, would enhance the value of the present
loans, and thus give the holders premium not
contemplated when they became purchasers,
and for which they never gave any valuable
consideration. This enchansed value would be
derived from privilege granted by the State,
and the State ought, therefore, to have the BEN
I.Gt aF 4 for ~ 4 l..
slation. Tue recent amendment of the Con-
sti;ution circumscrlbcs the power Of the Legis-
ature IN creating State debts, with an exception
/ IN favor af the debts coptracted radaan.