The Placer herald., 1862-04-19
The Treasury Demand Notes.

Hon. G. ii. Pend!eton, OF Ohio, in the House
of Representatives on the goth OF January
last, on the bill to authorize the issue of
United States notes, and for the redemption
and funding thereof and for funding the
floating debt of the United States, has given
us much information concerning the bill
authorizing the issuance of $780, ,OOO,OOO,
in what are termed Demand Notes, which
we are unable to gather from other sources
Since the bill has been law and one hun
dred millions of these notes are to be scat.
tered throughout the country and are to form
a circulating medium, the same as gold and
silver, and to be received ia commercial
transactions as such, it is proper that their
character should be known and understood
by the people. The bill provides for the
issue of $l0O,OOO,O 900 of Treasury notes, to
be paid, not on demand, as is generally sup
posed, nor at any fixed time, but whenever
the Government sees proper to pay them
and not before. They are made by an act
Of Congress, lawful money and legal tenn
der in payment Of all debts, public or private,
within the United States. The Government
mense Banking establishment, differing from
others, Iowever, in this particular, that its
currency is not convertible, nor is there any
term fixed for its payment. No other law
of the kind has ever been passed since the
Government had an existence, and its Con-
sttutonaIily may we'll be doubted. It seems
that this question of giving the Government
the power to issue paper currency for crcu,
lalion was before the Convention which
framed the Constitutions; that clause giving
the Government: the power to issue paper
money WAS proposed and rejected. 1t was
designed originally to forbid the State the
the Federal Government and accordingly
the first draft of the Constitution reported
by the Committee of revision, contained
clause prohibiting the power to the States,
and another clause, granting the Federal
Government the right to borrow money and
emit bills on the credit of the United States,
when this clause came up for discussion, AS
appears from page l343 of the third volume
of The Madison State papers,
"Mr. Gouveneur Morris moved so strike
ont "and emit bills on the credit Of the Unit
ed States" He said if the United States
had credit, such bills would be unnecessary;
if they had not, unjust and useless"
"Mr Butler seconde the motion"
Mr.. Madison thought it was advisable to
leave in the Constitution, the provision that
Congress might emit bills of credit. and to
deprive Congress of the power of making
them a legal tender. He suggested-
will it not he sufficient to prohibit the
making them tender. This will remove
the temptation to emit them with unjus'
views. And promlnssary notes, in that
shape, may in some emergencies be best"
very sharp debate followed upon the
proposition to strike on. from the Consttu
ton the clause rohferrng that power:
"Mr. Ellsworth, thought this was favor
able moment to shut and bar the door against
paper money. The mschieis Of the various
experiments which had been made were now
fresh in the public mind, and had excited the
disgust of all the respectable part of Anne
RIGA. BY Withholding the power from the
new Government, more friends of influence
would be gained to it than by anything else.
Paper money can in no case be necessary.
Give the Government credit, and other rel
sources will offer The power may do harm,
never good"
"Mr. Butler remarked that paper was a
legal tender in no country in Europe. He
was urgent for disarMng the Government of
such power
"Mr. Read thought the words, if not struck
out, would be as alarming as the mark of the
beast in the revolution"
"Mr. Langdon had rather reject the whole
plan than retain the three words, and emit
bills"
And on the motion to strike out these
words from the Constitution, it was decided
by vote Of nine States "aye," and two
States mo" The following was the vote:
Aves-New Hampshire, Massachusetts,
Connecticut, Pennsylvania Delaware, Vir-
ginia, North Carolina, South Carolina, and
Georga-9.
Noes-New Jersey and Maryland-2.
Mr.. Madison has appended note which
is as follows:
"This vote in the affirmative by Virginia,
was occasioned by The acquiescence of Mr..
Madison, who became satisfied that striking
out the words would not disable the Govern
ment from the use of public notes, as far as
thew could be safe and proper, and would
only cut off the pretext for a paper currency
and particularly for making bills lender
either for public or private debts"
This scrap of history does seem to put the
matter completely at rest, but when party
adhering to the doctrine of Higher Law has
possession of the Governmsnt it cannot be
reasonably expected that due regard will be
had for that instrument
In his famous report on National Bank
in 1890, he uses this language:
"The emitting of paper money by the au'
thority of the Government is wisely prohibit,
ed to the individual States by the NATIONAL
Constitution; and the spirit of that prohibit
-. ounht not To he disrararuad by the