, 1861-05-22
CHAPTER. Of. ILLINOIS,: HISTORY,
Banking md Bank Notes in 1891.
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!: Jngoeg. History Of Illinois, Chep.1, p. IS,
70 ind tne fsecfder : Currency Crisis, which
thrown no fneQusid derab1s alnu1nt Of Light mp.
OF, tho 4Q1ements .of the present day, whi}e
itaamonstxt,s, ths, vorthleesnees Of statne.
tory regulations Of kw making hodtes,, aud
ths windy reaolSes -cf public meetings., in
bo12tering up currency whleh every day's
experience proves Is not worth It's 1a1ue in
gold. Wsprtut It, t1usttrg to tbs aeumen Of,
our rea1ers to discover the analegies betneen
the events Of 1G2l, md thosa Of period forty
years Iater-between i currency baaed on tho
faith and credit Of the single State Of Illinois,
and that now wsd days issued on the credit Of
two dozen states, half Of which hareless ahl-
ity and disposition TO pay their debts than L.
LIMOS manifested in that carly Day. Let every
man draw his own conclusions:
Tbs United States government Was Thea
selling land at tFo dollars Per acre; eighty
douals on the quarter section to be paid down
on the purcbese, with credit Of dyc years
Tor tho residue. For nearly every sum OF
eighty dollxrp there NB5 In the country.
qGarter section of land Was purchased; for in
lhcse days there we're no specie circulars to
restraln uuwarrantabla srccnl.hons; but, On
the contrary, tbs notea OF most Of the numsr-
ous banks in existence, were good in the pub
lie land oficcs. Thn anount Of lind than
rurchaeed, WAS iucrco=ed By the general ex.
pcctatfon that the rapid settlement Of the
country would enable the sp: culator to soil It
fer high price, -hs{ore the expiration Of the
credit. THIS Grc.t abundance Of money also,
aFnrf fhfq ffTyYA TnaHH n YAat fuTFrhHA IN thA
tncunt OF merchandise brought into the State.
Wien money Is plenty every man'5 credit IL
gocd. The people dealt isrg:ly with the
ftcres on credit, and drew upon Z certasn for
ture in prospect fer payment Every oae Was
to get rich out OF the fatura emigraat: the
SPECTATOR was to sell him houses aud lands; ;
and the farmer VAS to sell him everything he
wanted to begin With, and to live upon, until
he could bnpply himself Towns vera laid
out sl1 over the country, and ioA were puf'
msker % received no money for his lots, but lie
received notes Of hand, which he considered
to be as good - caab; and he lived and en-
harked n ether vertures, as u they nad heen
cas1i1 in truth. In mode, by tEeyesr 1890,
7eiyed n debt. Tie banks IN Ohio snd K.a-
tuesy broke, one ,a;ter another, leaving the
people Of these Stats covered Hith Indebted
ness, and without the means OF ex.r;cation.
The banks ut horns~ End In St. Louis cea,cd
business. The great tide Of immigrants rom
abrosd, which had been looked for By every
bic; the l1nds purchased Of the United 8.stes
we1o unpaid for, and likely to be forfeited.
Bank notes had driven out specie, and whe1
these notes became worthless, there Was no
money Of any description left In the country.
And there Has abst!utely no commerce By
For In those days NC exported nothing; and
it thtEc bad bten any property tit for ezporta-
ton, there wss 10 market tor 1t abrosd, aud II
there had been market, there was no capital
with which to purchase 1t and take 1t to Inar-
ket. The people bsgan to sue one another for
monty in The country, it Haa evident that
scarcely any amount Of property would pay
the indebtedness.
To remedy these evils, the legislature Of
1921 created = State bank. It Tas foun dsd
Without money, and wholly on tho credit Of
the State. It HLe authorized to issue one,
two, three, five, ten and twenty dollar notes,
In the 1ikonees Of bank bills, bearing two pr
| cent. sunual interest, payable BY the 3sata in
| ten years. 4 principal bank Ha1 established
at VEndalia, .nd four or tlye branches IN other
! places; the Legislature elected al the diree-
| wero members OF the Legislature, and all Of
| them professional politicians: The bank was
directed BY Law to len Its bills to the peop1s,
| to the nmount Of ono hundred dollars, on per
eonal security; and upon the security u mort
lsg<s upcn lAad for 3 greater sum. These
! bills were to be receivable In payment Of all
| S.ate and county ta1es, and for all costa sud
1ees, and salaries Of public oflcers; and If d
| CREDITOR refused to endorse On his execution
| his willingness to fcc.ive them in payment Of
debt, the dehter could replory or stay Its col
| lection for thres Year,, BY giving ptrsonal Sc
curity. So Infatuated Hefe this legislature
| with thia ahaurd bank project, that the mem.
he:s firmly believed that the notes Of this
bank would remain At par with gold and silver;
and they could readily prove their beliefto be
! well fonndtd; for the most difficult argument
to answer is one founded partly upon fact, but
an evidence Of tho belief Of tho Legislature
TO this effect, the Journals shoW that reaotu-
lion wns p-sssd, Requesting tha Secretary OF
| the Treasury Of tbs United Statss, to receive
these notes into the land Offices In payment
| for the public lands. When this resolution
was Fut TO tho vote in the Senate, tho old
French Lient Governor, Col Menard, preal.
ding orsr that body, did up the buaineas ~
follows: "Gent1emen Of de Sonata, 1t II
| moved and seconded das ds notes Of dis bxnk
be made l.nd Office money. Al IN hvor Of
dot motion say aye; all against 1t, esy no. It
n:ade land eQze< n4onese'' Tho county Of Ne
| pard, on the sangamon river, vaa narhod ia
horror Of him and tic raEae could not haTo
been mora HorshflJ bestoWeL -:
In tho summer Of 1891, the new bank woat
| erdorzer borrowed bis hundred dollars. Tho
directors, 1t il believed, wsre all politicians
and either were then, or axpscted to b.,
candidates for oflee, Lending everybody, and
refusing none, WAS tbs suFeat Eoad 70 popular.
ity.. Accordingly, three hundred thousaad
cut much attention to :secu1ty or earefox
eventual payment. Il Atst fall twenty dYe
eeots, then fftT, and then seventy cents 6alow
par And - tho bills Of tho Ohio and Ken,
lucky banks had driven ell other money out
Of The State, 30 this new issue etfectually Kept
1t cut Such total absence WAS there Of tie
silver coins, that 1t became utterly Impossible,
| in the couree Of trade, to make small change,
/ The people from necessity, were compelled to
cut the new bills lnto two pieces, SO As to
make two halves Of dollar. THIS ssala fur
tter aided to keep ont even ths smallest silva
cotns,' for the people must know that good
money u very proud thing, and will nos cir
enlate. stay, or 30 wheT ead E1oneJ Is treatcd
with 70 mneh respect a. the good. For about
tour Jeazs there wsa no other kind sf money
hut tbs uncu1rent Slate bank paper. In tat
meantime, verJ ieT Parsons pretended to pay
ttoao who borrowed, considered what theJ
had gotten from 1t Is so much clear gain, anc
n.ver intended to pay It from the first
BY tho Year 1894, it beca1no impoasthle tt
carry on the State government with euet
money ss tbs bills Of this bank. The atats
revenue varied from twenty-five to thirty
shoaaand do'lars per annuua, which w4s ralset
almost exclusively BY a tax On lands, thef
owned BY non-reeldeuix, in tho military trac
lying northwest Of the Illinois riyes. Ths res
ident land taI in other parts Of the State, VIZ
laid into the county treasures. Tho annun
Expenditures Of the Slate government Hert
about tqusl to the revenues; and % this ta1e,
were collected In the bills OF the State hank
the Legislature, to carry on tbs government
vtre compelled to provide tor tlialz own pay
ard that Of all the public officers, aud tho az
pcneea Of tho government, By taking ona civ
Ing enough Of the depTeci2.ed bulls to sdua
In value the sums required to be paid. 81
that each member, instead Of ra caiviny thret
dollars Per tay, received nine dollars per day
The ealariea cf 1e governor and judges, ane
al other espcnsee, were paid In the same may
So .tat1 $4,000 Eere required to pay the ex
persia Of government for year, ncd-r thl
s5ktem 1t took 10000 Ia doit. Ard thus, b,
tie financial nd of an fn5ol7ent bank, tll
Legislature mnusged to trcblo tbs public ex
ptLsee, without Increasing the revenues O
amount Of service to tho 6tata In fact, thl
State lost tHo.thi1ds ef its reVe1ne, and e1
. pended three times tho amouDt necessary tt
cary cn the government. In the course O
ten yeuE, It must hare lost more than 8150
oo0 By receiving dep-nciated currency, $l50
coo more hy paying it GU, md 500, 900 OF th
leans, which were rcser repaid By tha boz
rume4r, and which the State lad to make good
! ty receiving the bills Of the bank for taxes, b.
lnutinE rome at elx per cent intere2s, an
| paying part in caah In the year 1881.
3. Another vcsAea Fired Into.
ff1pm The Now Orleans pfesyune, 17th.J
The schooner S;aF. Cant, Cannon. frou