The Cadiz Democratic sentinel. [volume] (Cadiz, Ohio) 1854-1864, 1861-12-25
Gl9t Gaoia Sentinel,
ANstionai Bank and "a National
Debt,

H
Those who remember the hard mon.
ey doctrines enunciated in the messages
of fSecretary Chase while Governor Of
Ohio, we're doubtless somewhat surpri.
sed at the. recommendations in his late
Treasury Report, that the Federal CO.
vernment should abolish the State banks
and provide the people, not with me-
talic, but with apaper currency.
In his messages to the Legislature of
Ohio, Governor Chase expressed the
same doubts that he does in his report
about the constitutionality of bank
notes issued under State authority, and
his belief that Congress under the pow
er"to regulate commerce." ""coin mon
ey," ETC., possessed ample authority to
prevent the circulation as money, by
State banks Or by banks chartered by
the several States, of paper or of any
substitute for coin. He did not how
ever, suggest, as now, that Congress
could constitutionally provide for pa
per currency for the people in lieu of
that furnished by the State banks. On
the contrary, he strongly intimated that
its power in this respect was limited to
the coming Of money and fixing the val
uc thereof, as it could make nothing
but gold and silver legal tender
The reader will find Governor Chase
views ON the subject of the currency
setforth at length in his message to the
Ohio Legislature, dated January 4, 1858.
The presentSecretary Chase appears
to differ i'll one important point from
the late Governor Chase. The former
alleges that ''it is too clear to be rea-
sonably disputed that Congress pos
:scsses ample authority to control, y not
simply the cash, but 'thc CREDIT cIR>
cULATIoN" of the country, and, in his
Judgment, 'the time has arrived when
Congress should exercise this authori
ty.'
The Secretary. presents two plans
for the exercise of this authority. The
first contcmplates the practical extinc-
tion of all the State State Banks (now
some 1900 in number) as banks off
issue, and the substitution for their
notes of "United States notes, payable
in coin on demand" The State banks
arc to be cxtinguished by "a moderate
tax gradually augmented on bank
notes." which in another part of the
report arc enumerated as proper sub
.jects of internal taxation or excise, and
incluled in the Same class as tobacco
and "listillcd liquors
The Secretary, however, sees serious
objections to national currency, thus
directly issued on the credit of the Uni
ted States, as it would encounter the
risk of "a deprecated, depreciating,
and finally worthless paper currency,
and theinnumerable evils of dishonored
public faith and national bankruptcy"
These considerations lead the Seerc-
tary to reject the first and recommend
the second plan, which is "the prepar-
alton and delivery to institutions and
associations of notes prepared for Cir
culation under national direction and to
be secured, as to prompt conyertibility
into coin, by the pledge of United
States bonds and other needful regula-
tions." This scheme will, in the opin-
ion Of the Secretary, secure "the sa-
fest currency the world has ever enjoy
ed," and have this particular advantage,
that twill cause "a large demand FOR
GOVERNMENT securities, and increased
facilities for obtaining the loans requi~
ed by the war;
1t will be seen at once that both
have this in common, that they create a
paper circulation based upon the CRED
1T of the Government, or in other
words, both propose the creation Of a
United States bank of issue. Accord
ing to the first plan, the notes would be
issued DIRECTLY by the Government;
according to the second, they would be
issued under its direction and control,
by institutions and associations acting
as its agents, which in reality amounts
to the same thing. If the credit
of tho Government should sink,
and its bonds become deprecated, the
notes CIRCULATING under its authority
would sink below par, and might be-
come worthless, under the operation of
the second plan as we'll as under that of
the first.
50 We haveno preference to express at
present for either plan. The second,
which appears to bc Secretary Chase's
pct scheme, proposes to establish
Bank Of the United States similar in
its main features to the Bank Of Eng |
land. He, however, says nothing in