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“The ferment of a free, is preferable to the.torpor.of a despotic, Gorcrnmcnt.”
YOI,. III.
ATHENS, GEORGIA, MAY 31, 1834.
NO. 11.
eotiffrcss.
i such an institution in 1816, which,
I opinion, was not necessary in 1811.
in hisjer nugatory. It
Thus that Congress shall have power “ to estab-1 Carolina, 8. It was also proposed to add this I of public opinion, in order to have an influ!
MPEJGCU OF HR. SCIILEY,
OK GEORGIA,
Delivered in the House of Representatives, on
Wednesday, 26tli March, 1834.
(concluded.)
It is somewhat amusing to look back to the
years 1791, 1811, 1815 and 1832, when the
questions of charter and recharter were sev-
crnllv under consideration in Congress, and
to observe the various changes of opinion
which have taken place in the minds of some
of the leading and talented politicians of the
day.
In 1791, Mr. Madison was opposed to the
charte r of the old Bank of the United States,
because he believed that Congress had no
power, according to the constitution, to grant
charters of incorporation ; and the argument
he then offered in support of his opinion, was
a plain, strong, common sense view of the
subject, which, to my mind, has never been
satisfactorily answered, and is unanswerable.
And yet, when President of the United
States, in 1816, he signed the charter of the
then, according to Mr. Clay’s arguments, ajlishPost Offices and post roads,” and then additional clause «to establish a university,” ence on the vote of this House. Here, then,
const tutional to-morrow, just as, in the opin. I should
ion of Congress, such an institution may, or them.
violate the laws made to establish
Secondly, no man, nor party of men
Bank mny be unconstitutional to-day and deny them the power to punish those who ! which was lost by a Vote of yeas, 4, nays 7. is a high-handed attempt, on the part of the
may not be necessary. But the great father during all the strife of party contests in the
and champion of the Bank of 1791, Alexan
der Hamilton, rejects this idea when advanc-
See 4th vol. Elliott’s Debates and illustra. Bank, to overawe us, and to force from
tious of the Federal Convention, pages 139, fears what cannot be obtained from our judg.
nation, from the foundation of the Govern
ment to the present day, has ever denied
147, 148, 199. And yet, notwithstanding
this authority to make corporations was ex
pressly refused to the federal government
ments. And shall we submit to such dicta
tion from an institution created by us? If
we do, sir, wc have descended to a state of
cd by Mr. Jefferson, and treats it as absurd. I these powers to Congress. And when the by the People, and that the whole theory and degradation that I never expected to witness
These arc his words : “The expediency of I whole nation, and all parties at all times, principles upon which the federal compact is Well, sir, the deposites have been remo-
cxcrcising a particular pou’er, at a particular j agree to the exercise of a power, there is based, are directly opposed to the exercise J ved by the Secretary, and, as I believe, in
time, must, indeed, depend on circumstan- no body to object to it, and therefore it must of such power, you see and hear statesmen j perfect accordance with the law’s and Con
ccs ; but the constitutional right of cxer- be admitted to exist. But wben a power is claiming and acting upon it as a matter set-1 stitution of the country, and with the contract
rising it must be uniform and invariable, the J claimed by some, and denied by others— tied and conceded upon the ground of prece-1 between the Government and the stockhold-
same to-day as to-morrow.”
Mr. Crawford always held
bo constitutional until after the Veto Message I when one political party bolds the existence I given in convention and refused ? The only
of the President in 1832, when ho too, chan- of a power, and is driven to a course of ab- oue which I have heard is this, “ that the
when, at one time, one half of the nation as. j dent. But what answer do gentlemen give I ers, and who now has control of them? I
the Bank to j sert the power, and the other half deny it— to the fact, that the power was proposed to be answer, Congress—and a control which it had
in favor of the expediency of such an institu
tion, as a fiscal agent of the government, and
to carry on the commercial operations of the
country. But, if we view this subject in all
our its bearings and consequences, 1 am not pre
pared to admit even the expediency of a bank.
And if I were, as expediency and constitution
ality are not convertible terms, I should still
be opposed it. *
If the corporation could be carried on by
some other sort of machinery than that of hu-
man heads, and hearts, and hands, which could
not be operated on by those motives which
usually actuate men, I might be disposed to
admit its expediency. But as it is an associ-
ation of men having like passions and proju-
ged his opinion and approved of the Veto,
Many other names of eminent statesmen
struse and metaphysical argument in order to
deduce it from the constitution, no two, even
convention would not incorporate it in the
constitution, because they feared it would en-
not, and could not have, before the Secretary
exercised his power under the charter. The
people’s money, then, is brought back, by the
act of the Secretary’, under the control of the
might be added to the list; but these will suf- of the same party, agreeing on the clause or danger its adoption by the People who were I representatives of the people, where it always
fice for my purpose. I do not mention these I article from which they derive it; and the opposed to granting such power.” Well, sir, j ought to be, and from which it ought never
names and facts for the purpose of charging opposite party totally deny its existence, and does not this answer give up the whole ar- J to have been taken, and the question now is,
these gentlemen with inconsistency. No sir,
I have a higher and a better object in view. I
do it for the purpose of showing, that if the
power claimed, was conferred by the constitu-
call on its advocates to put their fiuger on the gument ? Is it not a frank acknowledgment I what will you do with it ?
section of the constitution which confers it, that there is no such grant.in the constitution ? I But it is denied by my honorable colleague
cither directly or indirectly, and they can- And this answer was given to me by one of (Mr. Wilde) that Congress gave up the con-
not do it. And when, at another time, you the ablest advocates of the power of which trol over the deposites by the 16th section of
row. You would not find Mr. Clay denying
ing the power in 1811 and sustaining his [
can a plain, honest man, unlearned in the
art of political tactics, form of the consti-
Upon the whole, then, Mr. Speaker, and J iiimself in an absurdity when he makes this
after a laborious and critical investigation of assertion, and at the same time declares the
Who denies that
present Bank, not because he had changed
his opinion upon the constitutional question, j tion, it is not probable that such men would j see these men and these parties change pla- ] the Bank can boast, and proves the old adage, j the charter. He'says that legislative power
hut upon the ground of precedent, adopting assert the power to-day, and deny it to-mor- ccs by a counter march, what idea, I ask, “ that drowning men will catch at straws.” is inalienable, and that the Secretary involves
the legal maxim, stare decisis, and viewing a “ " “ ' “
legislator as standing in the same situation as
a judge. With all due deference for the lear. I ground by an able argument, and in 1816 I tution of his country? Now sir, I beg leave I the subject, my mind lias been brought to the I Charter unconstitutional?
iiing and talents of Mr. Madison, I must be ] claiming the power upon the ground ofncces- j to ask gentlemen what sort of a constitution I conclusion, that the charter of the United legislative power is inalienable? I do not,
permitted to regret tliut lie should have taken sity. You would not hear Mr. Calhoun claim this is, which is u> extremely accommoda- States Bank was granted without constitution- the Secretary does not, and no one that I
such an erroneous view of the subject. I am the power to incorporate a bank upon the ting as to suit any construction that the in- al authority in Congress to do so. And, know of has advanced the idea that Congress
a loss to conceive how so great a man ground that the constitution vests in Congress terest, the caprice, or the ambition of men holding this opinion, I cannot give my vote has alienated any part of its legislative power,
could have fallen into such a glaring error the power to regulate the currency, when in and parties may choose to put on it ? to recharter that institution, nor to charter any I But this is very clear, that Congress has con-
point of fact no such word is to be found in that The great body of the People who have other corporation, except it he located within tructcd that the public revenue shall be de-
instrument. The only power in regard to this no sectional interests or political views to the District of Columbia. I am also of opin. I posited in the Bank and its branches, “ unless
subje ct vested in Congress by the constitution subserve, look on this almost sacred instru- ion, that a large majority of the People and the Secretary'of the Treasury shall otherwise
is in the following words: « Congress shall ment, as a chart, by the directions of whch, of the representatives of the People on this j order and direct”—and all the departments
have power to coin money, regulate the val- any honest and skilful pilot can navigate floor, believe as I do in regard to this ques- j of the Government have declared that Con-
uc thereof, and of foreign coins, and fix the the great vessel of state into a safe har- tion. gress had a right to make this contract. Now,
standard of weights and measures.” 8th bpr. And, sir, it is a safe chart, which, If this be true, and that it is, we have full what difference is there between Congress
Section 1st Article. This clause is so very if the pilot will follow, he may easily avoid proof in the triumphant election of the Prcsi- and an individual in regard to the obligation
clear and explicit, that it seems to me impos- the whirlpool of Charybdis on the one hand, dent, and in the manifestations of opiuion al- of a contract between them ? Is not Con-
By and the rocks of Scylla on the other. But, ready exhibited in this House; then, I ask gress as much bound by its contract as the
the word “money,” it meant a metallic me-j if he disregard it, and set all sail to the breeze, 1 every candid man to answer this question—I Bank? Has not Congress, in this very con-
dium ; a metal that can be “ coined.” Who without compass and without chart, he need “ What is the proper course for me to pur- tract with the Bauk, promised and contracted
ever heard of coining paper? Congress, there- not be surprized to find himself in the wide sue under this state of facts.?” The answer! that it will not grant any other charter of a
fore, have no power to regulate the value of ocean of uncertainty, the sport of the winds will be, “You ought to sustain the President bank for the space of twenty years—that it
any money, except it be metallic, which may and waves, and finally shipwrecked on and Secretary in the course they have pur-1 will not exercise its legislative power (if it
he “coined.” With the currency of the some inhospitable shore, far, far from the desir- sued, and refuse to return the public deposites.” ever had any) to incorporate a bank until af-
country, therefore, made up as it now is of| ed port. And sir, are we not nowin this) But, we hear gentlemen on this floor, and J ter the expiration of a term of twenty years?
how
to
as to suppose for a moment, that there is |
any, the slightest analogy between the duties,
powers and responsibilities of these two sta
tions. The maxim of a legislator should he
malus tu us abokndus est, whilst those of a
judge aie ita lex scripta cst, and stare decisis.
A legislator is deputed by his constituents to
vake laws, such as in his judgment will con
duce to the well being of society, under an
enlarged view of the whole subject, looking | siblc for any one to misunderstand it.
at the same time to the probable consequen
ces of the act. He is to act upon the dic
tates of his own judgment and conscience,
hound by no precedent, and circumscribed by
no rule, except the constitution of his country
and the welfare of the commonwealth. A
judge, on the contrary, is appointed to ex-
pound the meaning of the law, after it is made
by the legislator ; and when thus expounded
by die supreme judicial power of the govern
ment, such decision must be taken as the
true construction of the law by all the judges,
unless manifestly wrong, until the legislature
alter it. And although a judge, who shall
afterwards be called on to enforce such de-
cision, may believe it to be wrong, his lan
guage will be this : “ If I were called on for
the first time to expound this law, I should
give it a different construction ; but the Su
preme Court have decided the question, and I
have no power to alter it. I am bound by
that decision, and to be governed by the max-
im stare decisis.” And why is this the rule
of the judiciary ? Because, as long as the
law exists, it should have one uniform con
struction, and not be liable to be changed
with every change of judges, or of opinion#,
so that all mny know what it is, and by what
tenure they hold their property’, their lives,
tempestuous sea of troubles, verging on to 1 on another floor, declare themselves opposed,
shipwreck, because we have disregarded our upon constitutional grounds, to this, or any {
chart, and lost our compass ? Yes, sir, and [ other Bank of the United States, aud yet ad-
here we find ourselves stranded on a Bank— Lvocate a return of the deposites; and what
not of gold nor silver; but a bank of paper, reason do they give for their course? Why,
and of corruption ; and it will require all the that the faith ol the nation is pledged by the
And yet 1 have never heard that either of
these stipulatious in the charter amounted to
an alienation of legislative power.
But the Secretary says the bank is uncon
stitutional. Does the honorable gentleman
understand the 'Secretary to say, that the
paper, the Congress have nothing to do, and
no right to interfere. But the legal and con
stitutional currency, called in the constitution,
“ money,” which may be “ coined,” is under
the control of Congress. You would not
hear Mr. Alston claim the right to institute _ _ _
a bank on that clause of the constitution I virtue and energy and patriotism of the cap-1 contract with the stockholders. A charter is not to be respected, because he be-
wliioh prohibits the Stales from issuing “ bills tain and the crew, to extricate us from our Upon this subject, sir, I must ask gentle-1 lieves it unconstitutional? i hope not, for
of credit.” And, sir, I was somewhat as- perilous situation. men to forget lor a moment, if they can, their Mr. Taney says no such thing, and thinks no
tonished to hear my honorable colleague I have been endeavoring to show that the hostility to the President, and look at this case such thing, because all the departments of the
(Mr. Wilde) express an opinion that under reasons heretofore advanced by the friends as it really is, without regard to tffe oue par- government having declared it to be constitu-
this clause of the constitution he consider-1 of the Bank in favor of its constitutionality, 1 ty or the other; and if they will do so, they tional it must be considered the law of the
ed all the State Banks ns unconstitution- are not sound ; and that none of the grounds will liud it to stand thus: the charter is a con- land, until it ceases by its own limitation,
al, because the term “ bills of credit,” means 1 upon which they have placed their arguments tract between the Uuited States and the stock-1 My honorable colleague also say s, that it the
all species of paper money, and at the same are tenable. If I can now show, as l believe holders, and each party is, in good faith, Secretary be right in saying that Congress
time claim for the Government of the United I can, that no warrant is to be found in the bound by the terms of the compact. By the had.no right to withdraw the public deposites,
States the right to issue “bills of credit.” I constitution for the exercise of the power 16th section of the Bank .charter, the public then it has no right to return them. This in
Sir, I would be glad to learn from what claimed, and that instead of the power having moneys of the United. States are to be depo- my humble apprehension does not necessari
clause of the constitution, or what political I been granted, it was expressly refused, I will sited in tlic Bank of the United States and its lv follow. The public money, as I said be
principle, the honorable gentleman derives have done all that is necessary to prove branches, “ unless the Secretary of the Trea- lore, is now by the action ot the Secretary
this power. The fact, that the States have that Congress, in the passage of the Bank sury shall at any time otherwise order and \ brought back under the control of Congress,
voluntarily agreed not to exercise this pow-1 charter, assumed a power never conferred on | direct.” The whole power of controlling the J and it may dispose of it in such manner as in
its judgment may be right.
This is now an origiual question standing
on its own merits, without reference to the
United States Bank or any other bank, and
Congress has full power to make any dispo-
sition of it that may be compatible with the
public interest.
Whatjthen, sir, will gentlemen do with the
public treasure ? Will they place it in a bank
which they believe to be unconstitutional, and
their liberty* or their reputations. A judge, I cr, which, as sovereign States, originally be- them by the People. I deposites, as far as the Bank is concerned,
the n, from the nature of his office, and the longed to them, by no means confers it on I lay down this general proposition as true is, by the very words of this section, and by
consequences of his decisions must necessari- the General Government. It is not true in in reference to our form of government, the consent of the stockholders, and of Con-
ly be hound by precedents, in order that the point of fact nor principle, that the mere which, I am sure, no friend of_State Rights gress, who were the contracting parties on
law msy be uniform and do equal justice to inhibition of the exercise of a sovereign pow. and constitutional liberty will deny, viz. The I this occasion, conferred on the Secretary of
all. But a legislator cannot be, and ought not cr to a State ipso facto confers that power on General Government never had, and does not the Treasury. No particular cases or cir
by the very naturo of his office, to be bound the United States. There must be an express now possess, any original inherent sover- curastauces are specified, upon the happen
by precedent. It is his duty to make, repeal, j delegation of the power to the General Gov-1 eignty, and therefore cannot rightfully .ex'er- ing of which, he may, or may not, remove the
amend., modify, or niter laws us the public eminent, or it must be fairly dcducible from cise any power not specifically granted to it, public moneys, or direct them to be withheld,
good may require. In short, it is the prov- a granted power, before they can rightfully except such as may be “ necessary and prop- All power m regard to this subject is vested
ince of a legislator to declare what the law exercise it. And in this case, as well as in er” to carrjrinto effect some one or all of the j in ttic hands of the Secretary, to be exercised I thereby increase its chances for a rechartcr ?
shall bo, and of a judge to declare what the [ that of crcnting corporations, the power was I delegated powers. But the State governments by him according to his own judgment, and I Will they again place this money beyond the
law is. proposed in Convention to be given, and re- J being originally, and inherently sovereign, 1 even his own caprice,. if gentlemen should 1 control of Congress, until the last moment ol
Mr. Madison, in giving his assent to the fused. See. 4th vol. Elliott’s debates, page J have the power to do any thing which is not prefer that word. But when he' shall - think the existence oi the bank, before they begin
Bank charter in the year 1816, made a 119. The States arc prohibited by the con- j morally impossible, or prohibited by the con- proper lor any cause to exercise this power, I to provide a new, and sale, and constitutional
compromise with his conscience, which I am stitution from making any thing but gold I stitution of the Strides, or of the United States, j he is bound to give to Congress his reasons depository ? I hope not. And, if this hope
unwilling to make with mine, and which Mr. and silver coin a tender in payment of debts; The creation of a corporation is ari act of for “ such order and direction.” It is to be not delusive, if there be, as I think there
Burwcil of Virginia, in his argument against but will any one thereby argue the existence sovereignty which the States may individual- Congress that he is answerable for his con- is, enough of firmness and virtue in this House
the renewal of the charter of the United S. of such a power in the Federal Govern- ly exercise, because they are iuherently sov-1 duct, and it is Congress alone that has any I to resist the efforts of the bank, and sustain
Bank in 1811, believed that Mr. Madison, ment? And yet these arc precisely analo- ereign, and have not been inhibited from the right to approve .or disapprove of his act. the course of the President and Secretary in
then the President of the United States, would gous cases. If Congress have the power to exercise of this original power, by the con- The Bank has no right to complain, and the act of removal, then it will bo incumbent'
not make : for, in that argument, Mr. Bur- emit “ bills of credit” under the constitution, stitution of the United States, nor by their ought not to be heard in this matter, and yet on us to make some provision for the future
well suited that “ ho could not suppose that I they have the same power to make paper, or I ° wn constitution. But this power not having I it has most insolently sent a manifesto to both I safekeeping of the public treasure. As, how-
Mr. Madison would use one set of arguments any thing else, a “ legal tender in payment j been delegated to the government of the Uni-1 Houses of Congress, in which it claims re- ever, that subject is not now pioperly before
in 1791, and act upon another now.” j of debts.” - - J ted States, either expressly or hy fair implica-1 dress for the injury done it by the Secretary, I the House, I will defer any remarks I may
lion, cannot be exercised by the federal gov-1 and in which also it compares the Presideut I have to make on it until it shall be presented
eminent, except by usurpation. This pow.} of the United States to the issuers of false for discussion.
er, instead of having been' given to the Gen- notes. No wrong has been done to the Bank The honorable gentleman from Pcnnsylva<
eral Government, was expressly refused, wben —no part of the contract has been violated, nia, (Mr. Binney,) admitted in the course of
it was proposed in the federal Convention, and the. Bank ought not to be a party to this his argument, that unless this bank is to be
On the 18th of August 1787, it was proposed issue { and yet it lias forced itself upon the I continued, or some other supplied, or a con.
in convention to vest in Congress the power I record, and the whole influence of its im-1 trot devised to prevent the State banks from
to “ grant charters of incorporation,” “ to es-1 mense power is brought to bear upon tho 1 shooting out of their orbits, no good could
tablish a university,” «to establish public in- question. And docs any one doubt this fact? result from returning the deposites. And the
stitutions, rewardsand immunities, for the pro-1 Look upon your table, sir, at tho numerous I honorable gentleman from South Carolina
motion of agriculture, commerce trades and petitions for a recharter of the Bank. Whence J (Mr. McDuffie,) admitted that if the bank is
manufactures.” These, and other proposi- do-they come ? They purport to come from not to be -rechartod, the act of the executive
tions submitted on that day were referred to the free people of the nation. They are sign-1 in the removal of the deposites, had only ac.
the Committee of Five, who ha d been- appoin- ed by persons in the large cities of all trades celerated tho distress jvbich must occur on
ted to consider of the constitution ; and, at and professions, from the shoe-black up to the J the expiration of the bank. With these ad-
a subsequent day Mr. Rutledge, the chair- portrait paiuter. Does any-roan believe that missions from the strongest and most talented
man of the committee, reported sundry J all these people desire a reebarter of the advocates of the bank, I am at a loss to con
amendments to the House, taking-no notice of I Bank upon principle, and because they are I ceive afiy adequate motive in those gentlemen
the above propositions. Afterwards, on the convinced of its utility and propriety ? Sir, who are opposed to a recharter, for voting a
14th of September, 1767, when the report there are thousands and tens of thousands of I return of the deposites.
of the Committee of Revision, as corrected these subscribers who know nothing and care Mr. Speaker, I propose now to say a few
and amended, was taken up, it was again pro- nothing about this Bank, except aa they are words in regard to the expediency of a Bank
posed to add this clause, “ to grant letters of made to believe that their happiness and pros. I of the United States, and upon the cause of
incorporation for canals,” «&c. which was lost perity arc connected with its fate. Those the distress which is alleged to exist in the
by tho following , vote : Yeas, Pennsylvania, who cannot be persuaded, are constrained by nation.
Virginia, Geprgia, 3; Nays, New Hampshire, the fiscal power of the Bank, either directly, The honorable gentleman from perinsylva-
Massachusetts, Connecticut. New Jersev,} or through its friends, to sign these mciDori-1 nia (Mr. Binney.) has made an able argumen.
Mr. Macon called Mr. Burwellto order for I But it is said that many other powers, not
using the namo of the President in debate. I specifically granted, have been exercised by
It seems that Congress in that day had some Congress; such as erecting light-bouscs, as
respect for the office of Chief Magistrate of incident to the power to regulate commerce ;
the United States. How is it now ? Mr. Bur- enacting penal laws to-punish crimes com
well said nothing disrespectful of Mr. Madi- milled against the Post Office Department,
son. On the contrary, be lauded him ; and &c. &c. And, because these incidental
yet, it was considered out of order, to men-1 powers have been exercised by Congress,
tion bis name in debate. But now, sir, to in order to carry into effect a clearly dclega
ci.ll the President a tyrant and usurper, to ’c- ted power, the advocates of all power to do
nouncehimas worse than Cmsar, and tocharge I any thing and every thing, contend that
him with having done an act for which a King Congress may make a corporation. If gen-
of England or of France would lose his head, tlcmcn will view this matter through a proper
pass for logical argument and classic wit. medium, they will discover two strong reasons
Sir, if gentlemen have no respect for the in favor of the exercise of these powers, and
patriot who nowfilisthe Executive Chair, they against the incorporation of a bank. In the
should at least have some for the office, for | fin t place, lighthouses arc absolutely neces-
their country, and for themselves.
In ihe Senate of the United States in 1811,
Mr. Clay opposed tho recharter of the old
Bank of the United States on constitutional
grounds, and charged Mr. Crawford with hav
ing gone over to the enemy’s camp be.
cause he supported tho recharter. In 1816
Mr. Clay supported the charter of the pres
ent Bank, because it was constitutional, and
grounds his argument upon tho necessity of
s&ry, in order to cany on tho operations of
both foreign and internal commerce; and
therefore the erection of them is only the ex-
ercise of a power “necessary and proper,” to
carry into effect a delegated power. So, al-
so, the enactment of penal statutes to punish
violations of the laws relating to Post Offices
and post roads, is- only a sanction given to
those laws, and are part And parcel of them,
without which those laws would be altogeth
dices with ourselves, and actuated by similar
motives, I am unwilling to place in their hands
a power and influence dangerous, os I be
lieve, to the best interests of the republic.
These men will have an eye single to their
own interests; political and pecuniar}’—and,
when it shall suit their purpose to join a cor
rupt and ambitious administration, if this na-
tion should ever be cursed with such an one,
to put down the liberties of the people, the
great pecuniary power they possess, joined
to the political power of their ally, will cosily
effect the object. Or, on the other hand, if
it should be their interest or caprice to join
their power to the power of an ambitious and
reckless leader of the opposition to a virtuous
and patriotic administration, they could do
much to subvert the free institutions of our
country, and raise a despotism on the ruins
of the republic.
But there is another objection to the expe
diency of a bank, and it does not rest on spec
ulation. It is the power which such a cor
poration holds over all the interests of the na
tion, whether commercial, manufacturing or
agricultural. Of this we have abundant evi-
dcnce sent here by the bank itself in the
shape of petitions and memorials from sundry
individuals of all trades and professions, who
happen to be located within the influence of
the noxious air of the marble palace. That
there is some distress in certain parts of the
country no man will doubt. Has there ever
been a time, when there was not some in the
large cities ? Is it greater now, than it has
frequently been on former occasions ? I be
lieve not. But if it be, the bank has caused
it, and then very coolly tells you, that An
drew Jackson has produced it by the removal
of the deposites. Sir, does Mr. Biddle be.
lieve this ? Doe j any man in his sober sen
ses, and who has any competent knowledge
of the subject, believe it ? I presume not.
I have said that the bank has caused this
state of things, and I will now prove it by evi.
dence which 1 am sure some gentlemen on
this floor will not attempt to controvert. Mr.
Biddle himself, sir, shall be my witness, and
shall tell you how he did this thing. In the
year 1828 a sudden and alarming scarcity of
money was felt in the large cities, and great
distress was the consequence; and that it
was owing to the operation of the banks no
body doubted. No other cause could be as
signed for it. And Mr. Biddle, the president
of the United States Bank, published, an essay
in the National Gazette on tho 10th of April,
1828, in which he gave the following elegant
and lucid exposition of one of the causes of
the evils, the community was then suffering.
I ask the indulgence and attention of tho House
whilst 1 read this essay, because I am sure
that they will be both pleased and edifled by it.
“The question,” says Mr. Biddle, “is,
what is the cause and the nature of the pre
sent scarcity of money ? The answer is ea
sy. The currency of the United States con-f
sists of coin and of bank notes promising to
pay coin. As long as the banks can always
pay the coin they promise, they are useful,
because, in a country where the moneyed
capital is disproportioned to the means of em
ploying capital, the substitution of credits for
coins enables the nation to make its exchan
ges with less coin, and of course, saves the ex
pense of that coin. But this advantage has
by its side a great danger. Banks arc often
directed by needy persons, who borrow too
much, or by sanguine persons, anxious only
to increase the profits, without much pecu
niary interest or personal responsibility in tho
administration. The constant, tendency of banks
is therefore to lend too much, and to put' too
many notes in circulation. Now, the addition
of many notes, even while they arc as good as
coin by being always exchangeable for coin,
may be injurious because the increase of tho
mixed mass of money, generally occasions a
rise in the price of adl commodities. The
consequence is, that the high price of foreign
productions tempts foreigners to semi a largo
amount of their commodities to us, while tho
high price* of domestic productions prevents
these foreigners from taking in exchange a*
large amount of our commodities. When,
therefore, you buy from foreigners more than
they buy from you, as they cannot take tho
paper tiart of your currency, they must tako
the coin part. If this is done to a considera
ble extent, the danger is that the banks will
be obliged to pay so much of their com for
their notes as not to leave them a sufficient
quantity to answer the demand for it, in whiclr
case tho banks fail, and the community is de-
frauded. To prevent this, a prudent bank,
the moment it peroeives an unusual demand
for its notes, and has reason to fear a drain
on its vaults, should immediately diminish the
amount of its notes and call in part of its debts,
So, on a large scale, when the banks'^f a
country perceive such a demand for coin for
exportation as diminishes too much the stock
of coin necessary for their hanking purpwes.
