Cleveland morning leader. [volume] (Cleveland [Ohio]) 1854-1865, 1862-01-07

anu OF llo Gelerhl GONefumentj ll8u54 W OO- i
tain the means Of suppresslng the existing |
rebellion. | have looked to 1t and depended |
upon It, and still do, as a certain source OF
greater assistance, If circumstances should
render It necessary to call upon II.
Having thus called the attention Of the
Legislature to this subject, | will only add
that / regard il as ono Of the most important
that can come before you at this session, and
hope II may be treated in the calm, unpre.
judicial spirit in which all purely business
questions should be acted upon and disposed
OF. l am aware thai questions as to the con-
stitutional powers of the Legislature are in-
VolVed respecting the manner of effecting
the object here recommended. These / do
not propose to discuss, but submit with en-
tire confidence to the wisdom OF the Legis-
lature in regard to the mode and extent of
taxation required under the Constitution and
laws OF the State, and other notifications
which experience may have shown to benec-
essary or expedient.
The Secretary Of the Treasury, in hls re-
cent able report to Congress, on the finances
Of the Government, has called in question
the constitutional power Of toe States to au-
thorize the issue Of paper currency by To-
cal institutions. He also suggests that the
exercise of this power may be controlled by
Congress under its constitutional powers to
levy taxes, to regulate commerce, and to reg
ulate the value of coin. In the judgment Of
the Secretary, the time has arrived when
Congress should exercise their authority.
Passing for the present, the considera-
tions that the power thus called in question
has been exercised by every State in the
Union, and this fro a the foundation Of the
/ Government to the present day; that it has
been recognized and sustained by the high
est tribunals Of the country In every de-
partment-executive, legislative, and ju-
dicial; that it has entered into and become
/ incorporated with Gll the business trans
actions Of the people; and that the intro
/ duetion of q new basis and system Of
credits for thirty millions Of people, by the
summary removal Of one that has thus been
established and acted on, would be attend
ed with most serious difficulties under any
circumstances, and especially under the
existing embarrassments Of the country
passing all these considerations, see the
most serious objections to the whole pro-
jeot in the means suggested for its accom-
plishment
The Secretary suggests that the gradual
withdrawal Of the notes ofprivste corpora
tions, and the issue in their stead, Of
United States notes, payable in coin OF
demand, may be effected by the exercise
by Congress, Of the power to levy taxes
and that moderate tax, gradually aug
mented, on bank notes, will relieve the
national from the competition Of local cir
culRtion. If the Government will furnish
q better currency to the people, thar
that Of their local banks, no such pro
cess as that Of a tax, gradually aug
mented, to the extinction Of the latter
will be necessary for the protection Of thi
former. The people are not only compe
tent to decide, but will be ready and quicl
to choose the better currency.
The right to discriminate in the impo
sition of taxes, for the encouragement snC
protection Of particular interests Of tn
people, may be admitted, and its exercis
under peculiar circumstances expected, bu
the right to discriminate sgsinst a specific
interest and to levy tax graduated to thu
declared purpose and object of its destruc
ton, is q power which, once conceded, MAJ
prove to be an engine of crushing force Il
any local or State interest, OF State insti
tuition.
The Secretary suggests two plans fol
furnishing a paper currency as substitutes
for that now furnished by local or Stat
banks, both of which are liable to serious
and as | think, fatal objections. HThe frs
contemplates the gradual withdrawal from
circulation of the notes Of private corpora
tions, and for the issue, in their stead, o
United States notes, payable in coin OF
demand, in amounts sufficient for the use
full ends of o representative currency" II
this plan such serious objections presented
themselves to the mind Of its author, tina
he abandons it. and dismisses it by saying
he contents himself with observing that, II
his Judgment, these possible disasters lin
cident to the plsn) so far outweigh thu
probable benefits of the plan, that he feell
ing its adoption. 1t may, therefore, bt
dismissed from further consideration.
The second plan Of the Secretary i!
simply the system of local banks, as nov
in existence, with a circulation based ex
clusively on United States stocks. Il diff
fers in no essential particular from the
stock bank system, now in use in thil
State, except that it excludes the stocks o.
the State, and requires those of the United
States as the sole basis of security for the
circulation.
To the objection slready stated to this
system of banking, namely, its want Of i'm.
mediate availability as distinguished from
ultimste security, the plan proposed il
liable to other objections, among which
may enumerate the liability of greater fuc
tuation in the market value of United
States than in Ohio bonds the establishing
of paper currency for all the States upon
one basis, the depreciation Of which, aside
from its ultimate security, would affect and
damage the entire system; the diseredit Of
State bonds, as basis Of security, and
throwing large amounts upon the market
in order to effect the proposed changes.
Such a currency, moreover, would in nc
sense be a national currency, notwithstsnd.
ing t'its common impression and common au.
thentication," for the issues of each Local
bauk would be convertible into coin only st
the bank issuing the same, which fact wonld
ix its character and standard, as q currency
and medium of exchange, and not the secur-
ity on which it may be based, or sits com.
mon impression and authorization" These
considerations, snd others which might be ad-
duced, compel my dissent to the expediency
of the proposed radical changes in the bank
ing system and currency of the country.
But independent of all objections to the
proposed plan Of the Secretary as a system oi
banking, and waving all the doubts, difficult
ties and dangers of undertaking to displace
existing systems as established in the several
Ststes, by the substitution Of that proposed,
under any, and certainly under the existing
condition OF the country, l consider the
measure impracticable, as one of relief to the
| Government.
lis presented as furnishing a market on
demand for the stocks of the Government
equal to the requirements Of the Government
to meet its expenditures. These the Seere-
tary estimates as follows:
For the Is al year ending June 90 ls6 500 OOC
For the fiscal year ending juno So ls63.s7s 500 O0o
II g