The national Republican., 1866-12-04

brought about. Hths determination Of the quss.
tlon was st to the 6serstary, all the banks would
be required TO redeem In New York, the aeknowi.
edssd commercial m.tropoll. Of the Union. The
designation Of that city as the redeemng point for
all National Banks would not only give absolute
uniformity 70 their circulation but would 90 faci.
tate the asserting and returning Of notes that prao
tical and general redemption would be enforced.
II 10 certain thst this will not be done under the
existing provision Of the law II is not certain that
Il viii &c. unless all banks shall be compelled to
redeem at single point. This might be objected
to by the banks In other Atlantic cities on the
ground that II would aggrandiIe New York at their
expense. But New York Is already the financial
the interior banks keep their chief balances In that
city because they are more available and valusbis
there than elsewhere, and In compelling all the
banks to redeem at the metropolis Of trade, Con.
grsss would be only yielding to an unwrittsn but
controlling law to which statutes should conform.
The course Of trade compsls, and will compel those
National Banks whose business Is based upon the
products oi the country land these must always
constituts Majority to keep their chief balances
In New York, whether they redeem there or not.
II exchanges between that city and other cities
should be In favor Of the latter the redemption BY
thar banks would BE- made At their own counters.
and no saerihes but that Of local pride would be
involved in their being required BY Law to redeem
at the common centre. When New York shall be
debtor city to Boston and Philadsphia the notes
Of the Boston and Phil.dslphia banks will 60 home
and not 10 New York, for payment What is re-
quirsd Is an active regular and actual redemption
Of the notes Of all the National Banks. To effect
this, local pride should be sacrifced and minor in.
terests should BE- disregardsd. wha. Is said upon
this subject By the Acting Comptroller Of the Cur
rency 10 fully indorsed.
The second remedy suggested Is q ourtsilmont Of
the currency. .. t.
The views Of the Secretary upon the question Of
> reduction Of the currency have been so frequent
y expressed, that II 10 only necessary now to con-
aider whsthsr the ourtailmsnt should bs Of the
United States notes or Of the notes Of the National
Banka On this subject his opinions have under
gons no change since he communicated them in
hts reports - Comptroller Of the Currency. Banks
Of Issue. organised under State laws, have been In
existence ever since the formation Of the Govern.
ment. By the decisions Of the highest tribunals Of
nrmed, and they have become so intsrwoven with
the business Of the country, and such large invest
ments have been made In them, that their destruc-
tion would involve consequences Of q very serious
character. Whether or not the country would have
been more prosperous with thsm--whether the
stimulus they have given 70 enterprise and the IA
cilities they have extended to trade have or have
not been countcrbalanoed by the artificial prices
which they have created, and the actual losses
which the people have sustained BY the crises they
ures-it Is too late to consider. When the National
Currency act was passed BY Congress, State banks
wero In full operation, and not less than four hun.
dred millions were invested in them as capital.
In some States, by judicious Legislation and care
full management, they had afforded local circula-
tion satisfactory and safe. In other States where
no reliable security, or insufficient security, had
been required for the protection Of the public and
| their management had been oonhded to incompe.
tent or dishonest hands, there had been numerous
failures. and heavy losses had been sustained by
| the holders Of their notes. "a -
Soon after the commencement Of the rebellion, II
became spparent that heavy national debt was to
bs orsatsi, the interest and principal Of which
could only be paid BY general system Of internal
taxes, Involving . necessity for . circulating me-
dium equal in. value throughout the country, and
| safe for the Government TO receive In payment Of
dues. This subject, Of course, demanded and 70.
osved the earnest and careful Of the
distinguished gentleman at that time the financial
minister Of the Government, who caused to be pre-.
pared and submitted to Congress bill ITO provide
States bonds and to provide for tho circulation and
redemption thereof, which, after having been cars.
fully considered and thoroughly discussed, became
Law on the 25th Of February, 1868. Prior to the
passage Of this aotr issues by the Government had
been put into circulation. But there Is nothing il
the acts authorizing their issue, or In the commu.
nioations Of the Secretary in the discussions II
Congress, to justify the opinion that they were In.
] tended to bo permanent circulation. On the con
l
into bonds, and the arguments Of the advocates Of
| their issue, afford ample evidence that they were
regarded Is merely temporary, and justifAbls only
by an emergency which It was supposed nothing
else could 50 adequately meet, Had 1t been pro-
posed that those notes should be permanent cir.
oulation and take the place Of bank notes, there Is
good reason to suppose that tho proposition would
have had few, If any, advocates. Nor was the M
tional banking system prepared BY Its author, nor
adopted BY Congress, to destroy tho State banks,
| 10 ltvark st.I f~au h,k. A.
compel all banking institutions Issuing notes as
money TO secure them, beyond any conceivable
contingency, by deposits with the Treasurer Of the
United States; thus, without the sgsnoy Of . na.
tionsl bank, providing national currency which
would save the Government and people from losses,
Of which there was constant danger, from local
and unsecured circulation The national banking
system WAS intended. while not invading the rights
Of the States, nor damaging private interests, to
furnish the people with permanent paper oircula.
tion Tho United States notes were intended to
meet temporary emergency, and to bs retired
shsn the emergency had passed.
The present Secretary was not the advocate Of
the national banking ssystem, and claims only the
credit Of having used his best efforts as Comptrol
lsr to put 1t into successful operation. But he
msnt upon the systems which II superseded, and
one admirably adapted TO our peculiar form Of
Government. There are substantial objections to
all banks Of ISSUE and II none existed In the United
States, II might be very Questionable II any should
be introducsdi but having taken the place Of the
State banks, and furnishing as they do q circula-
tion as free from objection any that is likely to
provided the Secretary Is Of the opinion that the
national banks should be sustained, and that the
paper circulation Of the country be reduced, not by
compelling them to retire their notes, but by the
withdrawal Of the United States notes.
The Secretary Is not unmindful Of the saving OF
interest which results to the Government by tho
Of its own currency Of the favor with which
this currency Is regarded by the peoples but all
considerations Of this nature are more than coun.
terbslanced by the discredit which attaches TO tho
Government by failing to pay its notes according
to their tenor, by the bad influence Of this voun-
tary discredt upon the public morals and the wide
departure which continued Issue Of legal-tender
notes involves, from past usages, II not from the
teachings Of the Constitution itself The Govern.
ment cannot exercise powers not conferred by Its
organic law necessary for its own preservation,
nor dishonor Its own engagements whom able to
meet them, without either shocking or demoral-
iring the sentiment Of the people, and the fact that
the Indefinite continuance Of tho circulation Of an
inoonvertible but still legaltender currency Is SO
generally advocated, indicates how far wo have
wandered from old landmarks both In finance and
ethics Tho views Of the Secretary on this point
were 60 fully expressed In his former report that 1t
10 not necessary to restate them It Is sufficient to
say that his opinions are unchanged, and that re-
Aection and observation during the past year have
| ,nft hat H. Ia