Indiana State sentinel. (Indianapolis, Ind.) 1861-1865, 1864-01-04

Use Of the Govern ment, pure and simple. II holds
every dollar of property in The country. corporate
aud individual, piedg ed for its redemption BY
act Of Congress il y a legal tender, and has re
Gently been 80 pronounced bv the highest tribu-
nal in the State of New York Aslawiul money,
it is as good between individuals as between the
Government aud an individual: itpays bank debts
well as shop debts. without any discount what
ever. Ok eat4
But, it has been pertinently asked, would you |
continue this paper currency in the form OF legal
tender, foreverf Is this issue, made from the ne
cessty of the case. TO become perpetualr Ger
tainly not The remedy is very simple. When
the war ends, the disbursements Of the Govern
ment will be at once reduced one half 10 two
thirds. OF course, then, the Government, TO
that extent ceasing 10 pay out legal tender, the
volume of circulation will decrease The notes
will also be converted into Understanding secu-
rites of the Government, aud then cancelled
the United States having no further use Tor them;
and thus, n two or three years, the legal tender
notes will be reduced to minimum amoint-to
As low n sum, that is as the people may desire
when they may be redeemed in specie by the
I Government. and re issued or not. There Is no
necessity. therefore. your Committee conceive,
for the creation OF a national bank currencS-as
has been suggested in Washngton--in order that
it may be substituted by the Government for le
gal tender currency Besides. If the legal tender
should be Withdrawn to make room for the ma
onal bank currency, what then will be lett with
| which to redeem that national currency. at the
counters Of the banks? Not specie, surely, for
they will hardly be expected to buy that at forty
to City per cent premium. or to pay out at par
in the redemption of their bills! And it may be
Justly feared that these national banks will come
to create a pow ersul interest throughout the coun
try in favor of protracted suspension of specie
payments, which it would be to their advantage
to continue for an indefinite period. This is a
very serious consideration, and is of itself suff
cient to excite great apprehension IN view OF such
probable result Is il as safe to have a bank pa
| per circulation without any specie at all i'm the
banks. as it is to keep bank currency which is
prote- tied already by a handsome specie reserve
in handy
Indeed, the proposed substitution of bank cur
rency for legal tender, would be direct loss or
injury to the Government Suppose, for in
stance, the three hundred millions bank currency
should be used by Government in place of like
amount of legal tender withdrawn, would not
the Government lose the interest on that sum,
which. at six per centum. amounts to eighteen
millions annually? Besides the Government
being obliged to hire money, in some other way
| the people must be taxed Tor the interest OH it,
in addition to what they now pay. The Goyern
ment certainly requires all The aid thlt can he
got from the of its legitimate credit. The
people have, therefore, direct pecuniarT inter
1
only lose thereby annual interest of eighteen
millions OF dollars, but it would lose the of
three hundred millions which il now has without
I interest, derived from that amount of legal ten
der notes; except, indeed, to the extent it might
dispose of its securities-in competition with
other sellers-for such bonds as may be lodged
for aationsl bank currency The people now
supplied with satisfactory currency, but in the
national bank currency they would have one that
is sure to become more less deprecated by its
very nature. Can any one doubt, then, the ef
feet OF the proposed currency on the welfare Of
the people of this country would be extremely
injuriOusl
1t now remains for your Committee to present
their views under the third head, viz: What will
be the probable consequences OF the CURRENCY to
the National Government This is by far the
most serious and important consider itun OF all.
Currency may de2recitte. Individuals miv lose
or suffer and the nation still continue prosperous
But il the credit aud integrity of our National
Government shall be impaired by the operations
of supendous banking scheme, unwise in its
inception, uuiimey in its birth, and irausht with
tendencies of evil consequences, it were better
far better, that it had fallen still born.
That your Committee may not even seem to
exaggerate, they will state what appears to
them be the simple state of affairs which
under the circumstances, sooner or later, is sure
to exist.
The United States will hold, in charge of the
Treasurer at Washington. its bonds for the
security aud final redemption of the circulating
notes of the national banks under an express
provision, that after protest 1T the Office of ennis
sion. the Government will. either by a sale Of
such securities, or by assuming them redeem the
protested notes. For time all may 20 on
swimmngy The banks will get out. their cir
culat0n, and increase. from time to time, till
bank originally of $4,000 capital, will have
swollen its uomin capital and Increased its cir
culaIng notes to S5i1 600. without perhaps ever
having redeemed. even with legal tender. SO,
O0J, AT its remote home Office. But pancs have
periodically come upon US They Will probably
always come Al incre ised volume of paper
currency is surely guarantee that are les
subject 10 them now than we have been hereto
fore On the contrary, Is not the public credit
more liable to a coll ilse than it ever WASP And
besides, this law permits the establishments of a
new "pet hank system" (lhe first phase OF which
is already in this city which Is liable to do
far more harm. public aud private. than even the
old one did.
In panic. he bills of banks are sent home for
redemption The notes of merely circulating
banks whel er under tte national law or under
the law of the State of New York, are likely to
be protested for non-paym eni: for such banks do
not keep specie, or other lawful money of the
United States with which 10 redeem their bills
only source of profit The bills of national
bank being protested, are sent 10 Washington Tor
redemption At such time, in crisis, the
Government has spare funds with which tn
take up bank bills. ImportatOns have fallen off
the receipts for duties are lessened Nothing re
mains TO put the United States bonds ON the
market, and sell them for what they will hring
The amount is large, but there is nb help for II
One third Of the who ihree-hundred millions
may be returned TO Washington un,ier protest;
but suppose the amOrht Is only half that sum
who is to be found, under such circumstances, Ia
Ibid fifty the dollar for ii ty millions
Of United States bonds especially when is known
that there are two hundred and hitv millions more
that may be fprcel Oh the markes>nn,er similar
circumstances? Where then is the credit of the
IInitel States Government Pr,Sra;e, broken
down. in the vain Effort TO sustain so-called
national currency. Why should the people for
one moment couhteuancea plan fraught with such
danger, or even such possibility Of danger to our
country Very likely. t,,o. this calamity may
befall US When not only domestic troubles harrass
but foreign complications mot threaten the peace
of our land
We have already ssen in this State the opera
ton OF like law OF New York. on y small -caIe
New York State stocks are selling 1T present. al
large advance par; but in 1851 when onty
a few hundred thousand dollars in them were
forced on the market TO redeem bank notes Sc
cured by them, they were sold n reduction OF
more than thirty per cent. Suppose twenty-five
millions had been thus thrown on the market
can any one doubt that they would have gone
below fftyf his is a trifing amount compared
with the millions that NAV be rushed home for
redemption, under the national currency system
The disastrous consequences will be proportion
ate TO the magnitude of the transactions For
laft all flts Act off IA 6al