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«* A lady !'' exclaimi'd Snow, and In- blushed with a pro
phetic sefisonf his dancer. . . .
“ Hem !” cried Mr. Whistleton; and after a low ehue.de
and a -UonJtast look at Snow, he said, “ John, show the la
dy in.”. 1 , , i i j
“No no”nai.l Snow; and then lie resolutely added,
“ if you please, show her in.” John quitted the room, am.
our bachelor was proceeding to inform his host of his sus
picions respecting the visiter, when the servant returned.
<• The lady, air. won’t come in; she’s in a hired ehnise,
sir taken bv the hour, sir—hut as the man disputes the
thim, and as', she savs, she knows she can depend upon
v our watch, will you 'tell her if she’s too slow or too fast ?
Saying which, John put Patty Larkspur’s well-known time-
picjco in the palsied hand of our a*ti>ni>hcd bachelor.
“ Too fast—much too fast,” said Snow, and lie returned
the corrected watch. The servant bavin" left the room.
Snow, amidst the smothered laughter <>f Whistleton and
half-a-dozen bosom friends, began to narrate the history o
his rirst meeting with Miss Larkspur, of his boasting in an
evil moment of the unerring qualities of his own watch,
and of the events of the preceding night. . \
“ I couldn’t have thought it of you,” cried \\ liiauetnn
purple in the face with laughter. Another elderly gentle
man chirited and crowed at “ Harry being found out at
1 ist.” A third tried to look solemn, and advised Snow “ to
be more careful ip such matters for the future;” whilst one
and all were stout hi ih'dr belief that “the lady wouldu t
have come there for nothing—-there must be something in
X.
In his walk from YVTiistleton’s house to his tavern, Snow
iml formed his resolution—he would, the very next raorn-
ng, retreat from Hastings, Finding the enemy too strong
or him, he was determined to go oil’without, beat ol drum.
f Thomas, which is the first coach / asked Snow of t.;e
waiter.
“Six o’clock, sir.” sail Thomas.
“ What places, Thomas?’’ demanded Snow.
“O.ilv two inside,” answered Thomas.
“ I’ll take them both,” said Snow.
“ Both !’’ cried Thomas.
“Both,” replied Snow, with vehemence; and thus de
priving l’atty Larkspur of a seat in the same vehicle with
himself, he felt secure of future quiet. “ A glass of wine-
liid-watcr, and then I'll go to bed,” said Snow, with a
lightened heart. Thomas returned with the beverage, and
having placed it on the table, with a smirk at his master,
lingered. “ What now /” asked Snow.
“ The watch, sir,” said Thomas. The lady wants
“Give it me,” cried Snow, and with the manner of a
lan who feels that he is performing an annoying office for
je last thru', he seemingly adjusted Miss Larkspur s
'nteh by his own, an 1, with a smile that she herseil might
ave envied, returned it to the man, saying, “ Tell her, a
ttle too fast.” Snow retired to his room, and, ere he
!ept, wrote a letter, to he delivered to his friend Whistle-
ju t!i’ next d iv, a > ilogizing for his unceremonious tl 'par-
from Hastings.
[The conclusion of Mr. Snow’s misfortunes, will lie giv-
i in onr next.]
ft* resident’s Message
70 THE TWENTY-FIFTH CONGRESS
Fcllotc-ci/izcns of the Senate
and House of Representatives :
The act of the 23 J of June, 183(5, regulating the depo-
sitrs of the public mon w, and directing the employment
of.State, District, and Territorial, Banks for that purpose,
made it the duty of the Secretary of the Treasury to dis
continue the use of such of them as should at any time re
fuse to redeem their notes in specie, and to substitute other
banks, provided a sufficient number could lie obtained to
receive the public deposites upon the terms ami i*on3Ut*>«*c
therein prescribed. The general and almost simultaneous
suspension of specie payments by the hanks in May last,
rendered tin performance of his duty imperative, i;i re
spect to those which had been selected under the act; and
made it, at the same time, impracticable to employ the re
quisite number of others, upon the proscribed conditions.
The snecitie regulations established by Congress lor the
deposite and safe keeping of the public moneys, having
thus unexpectedly become inoperative, I felt it to he my
duty to afford you an early opportunity for the exercise of
vour supervisory powers over the subject.
I was also led to apprehend that the suspension of spe
cie payments, increasing the embarrassments before exist
ing in'the pecuniniy affairs of the country, would so far di
minish the public revenue, that the accruing receipts into
the Treasury would nor, with the reserved live niilli-ns, be
sufficient to defray the unavoidable expenses of the Go
vernment, until the usual period for the meeting or Con
gress; whilst the authority to call upon the States for a
portion of the sums deposited with them, was too restrict
ed to enable the Department t > realize a sufficient amount
from that source. These apprehensions have been justified
bv subsequent results, which render it certain that this de
ficiency will occur, if a Llitio.aal means he not provided Gy
C ingress.
The difficulties experienced by the mercantile interest,
in meeting their engagements, induced them to apply to me,
orevious to the actual suspension of specie payments, for ■
iniu!"once upon their bonds lor duties; and all tne iclicf
authorized by law was promptly and cheerfully granted.
The dependence of the Treasury upon the avails of these
bonds, to enable it to make the deposites with the Stares
required by law, led me in the outset to limit this indnl-
to the first of September, but it lias since been ex
tend -d to the first of October, that the matter might be
submitted to your further direction.
Questions were also expected to arise in the recess iu
rosoeet to die October iustulmcnt-of those deposites, requi
ring the interposition of Congress.
A provision of another act, passed about the same time,
an'l intended to secure a faithful compliance with the obli
gation of the United States, to satisfy all demands upon
th un in specie or its equivalent, prohibited the oiler of any
bank note, not convertible on the spot into gold or silve r at
the will of the holder; and the ability of the Government,
with millions on deposite, to meet its engagements in the
manner thus required by law, was rendered very doubtful
by the event to which I have referred.
'.Sensible that adequate provisions fir these unexpected
exigencies could only be made by Congress; convinced that
some of them would be indispensably necessary to the
public s u-vice, before the regular period of y mr meeting;
and desirous also to enable you to exercise, at the earliest
mom tut, your full constitutional powers for the relief of the.
country, I could not, with propriety, avoid subjecting you
to the inconvenience of assembling at as caily a d iy ns toe
state of the popular representation would permit. I am
sure that I have done hut justice to your feelings, in belie
ving that this inconvenience will bo cheerfully encountered,
in the hope of rendering your meeting co.tuuci.e to the
good of the country.
During the earlier stages of the revulsion through which
we have just passed, much acrimonious discussion arose,
an 1 "rent diversitv of opinion existed, as to its real causes*.
This was not surprising. llie operations of credit are so
diversified, and the influences widen affect them so nume
rous, and often so subtle, that even impartial and well in
formed persons are seldom found to agree in inspect to
them. To inherent difficulties were also added other ten
dencies, which were by* no means fivorab.e to the di-cow
ry of truth. It was hardly to be expected that those who
disapproved the policy of the G ivcrunient in relation to the
currency, would, in the excited state of public feeling pro
duced liy the occasion, fail to attribute to that policy any
extensive embarrassment ill the monetary affairs of tbe
country. I he matter thus became connected with toe pas
sions and conflicts of party; opinions were more or less
affected by political considerations; and differences were
prolonged which might otherwise have been determined by
an appeal to facts, by the exercise of reason, or by mutual
concession. It is however a cheering reflection, that'cir
cumstances of this nature cannot prevent a community so
intelligent as ours from ultimately arriving at correct con
clusions. Encouraged by the firm belief of this truth, I
proceed to state my views, so far as may be necessary to a
clear understanding of the remedies i feel it my defy to
propose, and of the reasons by which I have been led to
recommend them.
The history of trade in the United States for the last
three or lour years, affords the most convincing evidence
that our present condition is chiefly to be attributed to over
action in all the departments of business; an over-action
deriving, perhaps, its first impulses from antecedent causes,
but stimulated to its destructive consequences by excessive
issues of bank paper, and by other facilities for the acqui
sition and enlargement of credit. At the commencement
of the year 183 1, the banking capital of the United States,
including tliatof tbe national bank then existing, amounted
to about two hundred millions of dollars; the bank notes
then in circulation to about, ninety-five millions; and the
loans and discounts of the hanks to three hundred and
twenty-four millions. Between that, time and the first of
January, 133(5, being the latest period to which accurate
accounts have been received, our banking capital war. in
creased to more than two hundred and fifty-one millions;
our paper circulation to more than one hundred aiul forty
millions, and the loans and discounts to more than four
hundred and fifty seven millions. To this vast increase ure
to be added the many millions of credit, acquired by means
of foreign loans, contracted by the States and State institu
tions, and, above all, by the lavish accommodations extend
ed by foreign dealers to our merchants.
The consequences of this redundancy of credit and of
the spirit of reckless speculation engendered by it, were
a foreign debt contracted by our citizens, estimated in
March last, at more thna thirty millions of dollars: the
«Xl£U*ion to traders in the interior of our country of cre
dits for supplies, greatly beyond the wants of the people ;
tlie investment of thirty-nine and a half millions of dol
lars in unproductive public lands, in the years 1333 and
1833. whilst in the preceding year, the sales amounted to
only four and a half millions; the creation of debts to an
almost countless amount, for refll estate, in existing or an
ticipated cities and villages, equally unproductive, and at
prices now seen to have been greatly disproportionate to
their real value; the expenditure of immense sums iu im
provements which, in many cases have been found to be
ruinously improvident; the diversion to other pursuits of
much of the labor that should have been applied to agri
culture, thereby contributing to the expenditure of large
sums in the importation of grain from Europe—un ex
penditure which, amounting in 1834 to about two hun
dred and fifty thousand dollars, was in the first two quar-
"ors of the present year, increased to more than two mil-
ions; and, finally, without CBUnicrjtting other injurious re
sults, the rapid growth aitirir.g ail classes, and especial
ly in our great commercial towns.of luxurious habits, found
ed too often on merely fancied wealth, and detrimental
alike to the industry, the resources, and the morals of our
people.
It was so i^possible that such a state of things could long
continue, that tlie prospect of revulsion was present to the
minds of considerate men before it actually came. None,
however, had correctly anticipated its severity. A con
currence of circumstances, inadequate or themselves to pro
duce such wide-spread and calamitous embarrassment/,
tended so greatly to aggravate them that they cannot be
overlooked in considering their history. Among these,
may lie mentioned, as most prominent, the great loss of
capital sustained by our commercial emporium in the fire
of December, 1338—a less, the effects of which were un
derrated at the time, because postponed for a season by the
great fat ilities of credit then existing; the disturbing ef
fects, in our commercial cities, of the transfers of the pub
lic moneys required by the deposite law of June. 1336; and
the measures adopted by the foreign creditors of our mer
chants, to reduce their debts, and to withdraw from the
United States a large portion of our specie. ,
However unwilling any of our citizens inn v heretofore have
been to assign to these causes the chief instrumentality in
producing the present state of things; the devclopcmehts
subsequently made, and the actual condition of other com
mercial countries, must, as it seems to me, dispel all re
maining doubts upon' tlie subject. It has since appeared
that evils similar to those sobered by ourselves, have been
experienced in Great Britain,- <>n the continent, and, in
deed. throughout the commercial world, and that in other
countries, ns well as in our own, they luive been uniformly
preceded by an undue enlargement of the boundaries of
trade, prompted, as with us, by unprecedented expansions
of the system of credit. A reference to the amount, of
bulking capital, and the issues of paper credits put in cir
culation in Great Britain, by hanks, and in other ways, dur
ing the years 1834, 1835, and 1836, will show an aug
mentation of the paper currency there, ns much dispropor-
tioned to the real wants of trade as in the United States.
With tliis redundancy of the paper currency, there arose
in that country also a spirit of adventurous speculation,
embracing the whole range of human enterprise. Aid
was profusely given to projected improvements; large in
vestments were made in foreign stocks and loans; credits
for goods were granted with unbounded- liberality to mer
chants is foreign countries; and all the means of acquir
ing and employing credit were put iu active operation, and
extended in their effects to every department of business
and to every quarter of the globe. The reaction was pro
portioned in its violence to the extraordii nry character
of the events which preceded it. Tlie commercial com
munity of Great Britain were subjected to the greatest dif
ficulties, and their debtors in this country were not only
suddenly deprived of accustomed atul expected credits,
but called upon for payments, which, in the actual posture
of things here, could only he made through a general
pressure, and at the most ruinous sacrifices.
In view of these facts, it would seem impossible for
sincere inquirers after truth to resist the conviction, that
tin? causes of the revulsion in both countries have been
substantially the same. Two nations, tlie most commer
cial in the world, enjoying but recently the highest de
gree of apparent prosperity, and maintaining with each o-
thcr the closest relations, arc suddenly, in a time of pro
found peace and without any great national disaster, ar
rested in their career and plunged into a stale of embar
rassment and distress. In both countries we have wit
nessed the same redundancy of paper money, and other
facilities of credit; tlie same spirit of speculation ; the same
partial successes; the same difficulties anil reverses; and,
at length, nearly the same overwhelming catastrophe. The
most material difference between the results i:i the fwo
countries has only been, that with us there has also occur
red no extensive derangement it: the fiscal a (lairs ot the t c-
deral and State Governments occasioned by the suspension
of specie payments by the hanks.
Tlie history of those causes and effects in Great Bri
tain and tlie United States, is substantially the history of
the revulsion in all other commercial countries.
The present and visible effects of these circumstances
on the operations of the Government, and on the industry
of the people, point out the objects which call for your
immediate attention.
They arc—to regulate by law the safe keeping, trans
fer and disbursement ot the public moneys, to designate
the funds to bo-received and paid by the Government; to
enable the Treasury to meet promptly every demand upon
ir; to prescribe the terms of indulgence, and the mode of
settlement to he adopted, as well in collecting from in
dividuals the revenue that has accrued, as in withdrawing
it from former depositories, and to devise and adopt such
further measures, within the constitutional competency of
Congress, as will he best calculated to revive the enterprise
and to promote the prosperity of the country.
For the deposite, transfer, and disbursement, of the re
venue, National and State Banks have always, with tem
porary and limited exceptions, been heretofore employed;
hut, although advocates of each system are still to be found,
it is apparent that the events of the last few months have
greatly augmented tlie desire, long existing among the peo
ple ot the United States, to separate the iisral operations
of the Government from those of individuals or corpora
tions.
Again, to create a national bank, as a fiscal agent, would
be to disregard the popular will, twice solemnly and une
quivocally expressed. On no question of domestic policy
is there stronger evidence that tlie sentiments of a large ma
jority are deliberately fixed; and I cannot concur with
those who think they see, in recent events, a proof that
these- sentiments are, or a reason that they should be,
changed.
Events, similar in tlmir origin and character, have here
tofore frequently occurred, without producing any such
climge; and the lessons of experience must he forgotten,
if we suppose that tlie present overthrow of credit would
have been prevented by the existence of a national bank.
1’roneness to excessive issues has ever been the vice of the
banking system ; a vice as prominent in National as in
State institutions. This propensity is as subservient to the
advancement of private interests in the one as in the other;
and those who direct them both, being principally guided
by the same views, and influenced by the same motives,
will he equally ready to stimulate extravagance of enter
prise by improvidence of credit. How strikingly is ibis
conclusion sustained by experience. The Bank of the Uni
ted States, with the vast powers conferred on it by Con
gress, did not or could not prevent former and similar em
barrassments ; nor has the still greater strength it has hern
said to possess, under its present charter, enabled it, in the
existing rmern’nn*, to check other institutions, or even to
save itself. In Great Britain, where, it has been seen, the
same causes have been attended with the same effects, a
national bank, possessing powers far greater than arc ask-
el for by the warmest advocates of such an institution
here Jins also prove 1 unable to prevent an undue expansion
of credit - tied the evils that flow from it. Nor can I find
anv tenable grout:d for the re-establishment of a national
hank, in the derangcmcu* alleged at present to exist in the
domestic exchanges of the c-UETry, or in the facilities it
may he capable of affording them. A v hough advantages
of this sort were anticipated when the ii. f Bank of the
United States was created, they were regarded fls an inci
dental accommodation; not one which the Federal iw''
eminent was bound, or could be called upon, to furnish.
This accommodation is now, indeed, after the lapse of not ma
in* years, demanded f rom it as among its first duties; and
an omission to aid and regulate commercial exchange, is
treated as a ground of loud and serious complaint. Such
results only serve to exemplify the constant desire, among
some of onr citizens, to enlarge the powers of the Govern
ment, and extend its control to subjects with which it
should not interfere. They can never justify the creation
of an institution to promote such objects. On the contra
ry, tliev justly excite among the community a more diligent
inquiry into the character of those operations of trade, to
wards which it is desired to extend such peculiar favors.
The various transactions which bear the name of domes
tic exchanges, differ essentially in their nature, operation,
and utility. One class of them consists of hills of ex
change, drawn for the purpose of transferring actual cap
ital from one part of the country to another, or to anticipate
the proceeds of property actually transmitted. Bills ol
this description aro highly useful in the movements of
trade, and well deserve all the encouragement which can
rightly be gi\en to them. Another class is made up ot
hills of exchange, not drawn to transfer actual capital, nor
on the credit of property transmitted, hut lo ejeate ficti
tious capital, partaking at once of the character of notes
discounted in hank, and of hank notes in circulation, and
swelling the mass of paper credits to a vast extent in the
most objectionable manner. T hese bills have formed, for
tlie last few years, a large proportion of what are termed
the domestic exchanges of the country, serving as the
means of usurious profit, and constituting the most unsafe
and precarious paper in circulation. This species ol traf
fic, instead of being upheld, ought to be discountenanced
by the Government and the people.
' In transferring its funds from place to place, the Govern
ment is on the same footing with the private citizen, and
may resort to the same legal means. It may do so through
the medium of bills drawn by itself, or purchased from
others; and in these operations it may, in a manner un
doubtedly constitutional and legitimate, facilitate and assist
exchanges of individuals founded on real transactions of
trade. The extent to which this may be done, and the
best means of effecting it, are entitled to the fullest con
sideration. This has been bestowed by the Secretary ol the
Treasury.and his views will be submitted to you in his report.
But it was not designed by the Constitution that the Go
vernment should assume the management of domestic or
foreign exchange. It is indeed authorized to regulate by
law the commerce between the States, and to provide a
general standard of value, or medium of exchange, in gold
and silver ; but it is not its province to aid individuals in
the transfer of their funds, otherwise than through the fa
cilities afforded by the l’ost Office Department. As justly
might it be called on to provide for the transportation ol
their merchandise. I hese are operations of trade They
ought lo be conducted by those who are interested in them,
in the same manner that the incidental difficulties of other
pursuits are encountered by other classes of citizens. Such
aid has not been deemed necessary in other countries.—
Throughout Europe, the domestic as well as the foreign
exchanges, arc carried on by private houses, often, if not
generally, without the assistance of banks. Yet they ex
tend throughout distinct sovereignties, and far exceed in
amount the real exchanges of the United States. There is
no reason why our own may not be conducted in the same
manner, with equal cheapness and safety. Certainly tliis
illicit i.e accomplished, if it were favored by those most
deeply interested; and few can doubt that llicir own inte
rests, as well as the general welfare of the country, would
be promoted by leaving such a subject in the hands of those
to w hom it properly belongs. A system founded on pri
vate interest, enterprise and competition, without the aid
of legislative grants or regulations by law, would rapidly
prosper; it would he free from the influence of political
agitation, and extend the same exemption to trade itself;
anil it would put an end to those complaints of neglect,
partiality, injustice, and oppression, which are the unavoid
able results of interference by the Government, in the pro
per concerns of individuals. All former attempts on the
part of the Government to carry its legislation, in this res
pect, further than was designed by the Constitution, have
in the end proved injurious, and have scrVed only to con
vince the great body of the people, more anil inure, of the
certain dangers of blending private interests with the opera
tions of public business ; and there is no reason to suppose
that a rendition of them now would lie more success!ul.
It cannot be concealed that there exists, in our conimuni-
tv, opinions and feelings on this subject in direct. Opposi
tion to each other. A large portion of them, combining
great intelligence; activity, and influence, are no doubt sin
cere in theii* belief that the operations of trade ought to he
assisted by such a connection ; they regard a national bank
as necessary for this, purpose; and they are disinclined to
every measure that does not tend, sooner or later, to the
establishment of such an institution: On the other hand,
a majority of the people are believed to lie irreconcilably
opposed to that measure: they consider such a concentra
tion of power dangerous to their liberties; and many of
them regard it as a violation of the (.(institution. Ibis
collision of opinion has, doubtless, caused much of the em
barrassment to which the commercial transactions of the
country liuvo lately been exposed. Banking has become
a political topic of the highest interest, and trade has suf
fered in the conflict of parties. * A speedy termination of
this state of things, however desirable, is scarcely to he
expected. We have seen for nearly half a century, that
those who advocate a national bank, by whatever motive
they may he influenced, constitute a portion of our commu
nity too numerous to allow us to hope for ail early aban
donment of their favorite plan. On the other hand, they
must indeed form an erroneous estimate of the intelligence
and temper of the American people, who suppose that
they have continued, on slight or insufficient grounds, their
persevering opposition to such an institution ; or that they
can he induced by pecuniary pressure, nr by any other
combination of circumstances, to surrender principles they
have so long and so inflexibly maintained.
Mv own views of the subject are unchanged. They
have been repeatedly and unreservedly announced to my
fellow citizens, who with full knowledge of them, confer
red upon me the two highest offices of the Government.—
On the last of these occasions, I felt it due to the people to
apprize them distinctly, that, in the event of my election, 1
would not he able to co-operate in the re-establishment of a
national bank. To these sentiments, I have now only to
add the expression of an increased conviction, that the re
establishment of such a bank, in any form, whilst it would
not accomplish the beneficial purpose promised by its advo
cates, would impair the rightful supremacy of the popular
will; injure the character and diminish the influence
of our political system; and bring once more into exis
tence a concentrated moneyed power, hostile to the spi
rit, and threatening the permanency, of our republican
institutions.
Local banks have been employed for the deposite and
distribution of the revenue, at all times partially, anti, on
three different occasions, exclusively; first, anterior to the
establishment of the first bank of the United States; se
condly, in the interval between the termination of that in
stitution and tlie charter of its successor; and, thirdly, du
ring the limited period which has now so abruptly closed.
The connection thus repeatedly attempted, proved unsatis
factory on each successive occasion, notwithstanding the
various measures which were adopted to facilitate or in
sure its success. On the last occasion, in the year 1333,
the employment of the State banks was guarded especially
in every way which experience and caution could suggest.
Personal security was required for the safe-keeping and
prompt payment of the moneys to be received, and full re
turns of their condition were, from time to time, to be
made by the depositories. In the first stages the measure
was eminently successful, notwithstanding the violent op
position of the Bank of the United States, and the unceas
ing efforts made to overthrow it. The selected banks per
formed with fidelity, and without any embarrassment to
themselves or to the community, their engagements to the
Government, and the system promised to he permanently
useful. But when it became necessary, under tbe act of
June, 1836, to withdraw from them the public money, for
the purpose of placing it in additional institutions, or of
transferring it to the States, they found it, in many cases,
inconvenient to comply with the demands of the Treasure,
and numerous and pressing applications were made for in
dulgence or relief. As the instalments under the deposite
law became payable, their own embarrassments, and the
necessity under which they lay of curtailing their discounts
and calling in their debts, increased the general distress,
and contributed, with other causes, to hasten the revulsion
in which, at length, they, in common with the other banks,
were fatally involved.
Under these circumstances, it becomes our solemn duty
to inquire whether there are not, in any connection between
the Government and hanks of issue, evils of great magni
tude, inherent in its very nature, and against which no pre
cautions can*effectually guard.
Unforeseen in the organization of the Government, ami
forced on the Treasury by early necessities, the practice of
employing banks, was, in truth, from the beginning, more a
measure of emergency than of sound policy. W hen we
started into existence as a nation, in addition to the burdens
of the new Government, we assumed all the large hut ho
norable load of debt which was the price of our liberty;
but we hesitated to weigh down the infant industry of the
country by resorting to adequate taxation for the necessary
revenue. The facilies of banks, in return for the privile
ges tliev acquired, were promptly offered, and perhaps too
readily received, by an embarrassed Treasury. During the
long continuance of a national debt, and the intervening
difficulties of a foreign war, the connection was continued
from motives of convenience; but these causes have long
since passed away. We have no emergencies that make
banks necessary to aid the wants of the Treasury; we have
no load of national debt to provide for, and we have on ac
tual deposite a large surplus. No public interest, there
fore, now requires the renewal of a connection that circum
stances have dissolved The complete organization of our
Government, the abundance of our resources, the general
harmony which prevails between the different. States and
with foreign Powers, all enable us now to select tlie system
most consistent with the Constitution, and most conducive
to the public welfare. Should w e, then, connect the Trea
sure for a fourth time with the local banks, it ran only be
under a conviction that past failures have arisen from acci
dental, not inherent, defects.
A danger, difficult, if not impossible, to be avoided in
such an arrangement, is made strikingly evident in the ve
ry event by which it 1ms now been defeated. A sudden act
of the banks intrusted with tlie funds of the people, de
prives the Treasury, w ithout fault or agency of the Govern
ment, of the ability to pay its creditors in the currency they
have by law a right to demand. This circumstance no
fluctuation 0 f commerce could have produced, if the pub
lic revenue luH been collected in the legal currency, and
kept in that form b, (he offkm* 3 of the Treasury. The ci
tizen whose money was i..L?nk receives it back, since the
suspension, at a sacrifice in its aine’-r't; " Mist he w ho kept
it in the legal currency of the country, Ui. 1 * bis own pos
session, pursues, without loss, the current of tnj business.
The Government, platted in the situation of the forme.**;
involved in embarrassments it could not have suffered had
it pursued the course of the latter. These embarrassments
are, moreover, augmented by those salutary and just laws
which forbid it to use a depreciated currency, and, by so
doing, take from the Government the ability which indivi
duals have of accommodating their transactions to such a
catastrophe.
A system which can, in a time of profound peace, when
there is a large revenue laid by, thus suddenly prevent the
application nnd the use of the money of the people, in the
manner and for the objects they have directed, cannot be
wise; but who can think, without painful reflection, that,
under it, the same unforeseen events might have befallen
u- in the midst of a war, and taken from us, at the moment
when most w anted, the use of those very means which were
treasured up to promote the national welfare and guard our
national rights ? To such embarrassments and to such dan
gers will this Government be always exposed, whilst ii
takes the moneys raised for, and necessary to, the public
service, out of the hands of its own officers, and converts
them into a mere right of action against corporations en
trusted with the possession of them. Nor can such results
be effectually guarded against, in such a system, without
investing the Executive with a control overthc banks them
selves, whether State or National, that might with reason
be objected to. Ours is, probably, the only Government in
the world that is liable, in the management of its fiscal
concerns, to occurrences like these. But this imminent
risk is not the only danger attendant on the surrender of
the public money to the custody and control of local cor
porations. Though the object is uid to the Treasury, its ef
fect may be to introduce iuto the operations of the Govern
ment, influences the most subtle, founded on interests the
most selfish.
The use by the banks, for their own benefit, of the mo
ney deposited with them, has received the sanction of the
Government from the commencement of this connection.—
The money received from the people, instead of being kept
till it is needed for their use, is, in consequence of this au
thority, a fund, on which discounts are made for the profit
of those who happen to be owners of stock in the banks se
lected as depositories. The supposed and often exaggera
ted advantages of such a boon will always cause it to be
sought for with avidity. I will not stop to consider on
whom the patronage incident to it is to be conferred, whe
ther the selection and control he trusted to Congress or to
the Executive, either will be subjected to appeals made in
every form which the sagacity of interest can suggest.—
The banks, under such a system, are stimulated to make
the most of their fortunate acquisition; the deposites are
treated as an iucrease of capital; loans and circulation are
rashly augmented, and, when the public exigencies require
a return, it is attended with embarrassments not provided
for, nor foreseen. Thus banks that thought themselves
most fortunate when the public funds were received, find
themselves most embarrassed when the season of payment
suddenly arrives.
Unfortunately, too, the evils of tlie system are not litni-
ted to the banks. It stimulates a general rashness of en
terprise, and aggravates the fluctuations of commerce and
the Currency. This result was strikingly exhibited during
the operations of the late deposite system, * and especially
in the purchases of public lands. The order which ulti
mately directed the payment of gold and silver in such pur
chases, greatly checked, but could not altogether prevent,
the evil. Specie w as indeed more difficult to be procured
than the notes which the banks could themselves create at
pleasure; but still, being obtained from them as a loan,
and returned as a deposite. which they were again at lib
erty to use, it only passed round the circle with diminished
speed. This operation could not have been performed,
hml the funds of the Government gone into the Treasury,
to be regularly disbmsctl, find not into banks, to beloancd
out fur their own profit, while they were permitted to sub
stitute for it a credit in account;
Tn expressing these sentiments, I desire not to underval
ue the benefits of a saiutary credit to any branch of enter
prise. The creditbestoU-ed on probity and industry is the
just rew ard of merit, and an hdnorablc incentive to further
acquisition. None oppose it who love their country and
understand its welfare. But when it is unduly encour
aged—when it is made to inflame the public mind w ith the
temptations of sudden anil unsubstantial wealth—when it
turns industry into paths that lead sooner Or later to disap
pointment and distress—it becomes liable to censure, and
needs correction. Farfrohi helping probity and industry,
the ruin to which it fluids falls riiost severely on the great
laboring classes, who are thrown suddenly out of employ
ment; and bv the failure of magnificent schemes never in
tended to enrich them, are deprived in a moment of their
only resource. Abuses of credit and excesses in specula
tion will happen in despite of the most salutary laws; no
Government perhaps can altogether prevent them; hut
surclv every Government can refrain from contributing the
stimulus that calls them into life.
Since, therefore, experience has shown, that to lend the
public money to the local bunks, is hazardous to the oper
ations of tlie Government, at least of doubtful benefit to
the institutions themselves : and productive of disastrous
derangement in the business and currency of the country, is
it the part, of wisdom again to renew the connection?
It is true that such an agency is in many respects con
venient to the Treasury, but ir. is not indispensable. A lim
itation of the expenses of the Government to its actual
wants, and of the revenue to those expenses, with conveni
ent means for its prompt application to the purposes for
which it w as raised, arc the objects which we should seek
to accomplish. The collection, safe-keeping, transfer anil
disbursement of the public money, can, it is believed, he
well managed by officers of the Government. Its collec
tion, and, to a. great extent, its disbursement also, have in
deed been hitherto conducted solely by them; neither Na
tional nor State hanks when employed, being required to
do more than keep it sat'elv while in their custody, and
transfer and pay it in such portions and at such times as
the Treasury shall direct.
Surely banks are not. more able than the Government to
secure the money in their possession against accident, vio
lence, or fraud. The assertion that they arc so, must as
sume that a vault in a bank is stronger than a vault in the
Treasury; and that directors, cashiers, and clerks, not se
lected by the Government, nor under its control, are more
worthy of confidence than officers selected from the people
and responsible to tlie Government; officers bound by of
ficial oaths anil bonds for a faithful performance of their
duties, and constantly subject tothcsupervision of Congress.
The difficulties of transfer, and the aid heretofore ren
dered by banks, have been less than is usual!v supposed.
The actual accounts show that by far the larger portion of
payments is made within short or convenient distances
from the places of collection ; and the whole number of
warrants issued at the Treastuy in the year 1331—a year,
the results of which will ir is believed afford a safe test for
the future—fell short of five thousand, or an average of less
than one daily for each State; in the city of New* York they
did not average more than two a day, at the city of Wash
ington only four.
The difficulties heretofore existing are, moreover, daily
lessened by an increase in the cheapness and facility of
communication; and it may be asserted with confidence,
that the necessary transfers, a3 well as the safe-keeping
and disbursements of the public moneys, can he with safe
ty and convenience accomplished through the agencies of
Treasury officers. This opinion has been, in some degree,
confirmed by actual experience since the discontinuance of
the banks as fis'-a! agents, in May last; a period which,
from the embarrassments in commercial intercourse, pre
sented obstacles as great as any that may be hereafter up-
[ le’iei fled.
The manner of keeping the public money since that p
rioil, is fully stated in the report of tl.e Secretary of the
Treasury. This officer also suggests the propriety of as
signing, by law, certain additional duties to existing es
tablishments and officers, which, with the modifications
and safe-guards referred to by him, will, he thinks, enable
the Department to continue to perform this branch of the
public service, without any material addition either to
their number or to the present expense. The extent of the
business to be transacted has already been stated ; and in
respect to the amount of money with w hich the officers
Um?' * ussu mi ng ‘li ou i , 21 i 1 . RYw IIP nIT sflUn WM-3
kept in the Treasury, nnd the whole of it left in the hands
of the collectors ami receivers, the proportion of each
would not exceed an average of thirty thousand dollars;
but that, deducting one million for the use of the mint, and
assuming the remaining four millions to he in the hands of
one-half of the present number of officers—a supposition
deemed more likely to correspond with the fact—tlie sum
in the hands of each would still lie less than the amount of
most of the bonds now taken from the receivers of public
money*. Every apprehension, however, on the subject,
either in respect to the safety of the money, or the faithful
discharge of these fiscal transactions, may, it appears to
me, be effectually removed by adding to the present means
of the Treasury the establishment by law, at a few import
ant points, of offices for the deposite nnd disbursement of
such portions of the public revenue as cannot, with obvious
safety and convenience, be left in the possession of the col
lecting officers until paid over by them to the public credi
tors. Neither the amounts retained in their hands, nor
those deposited in the offices, would, in an ordinary condi
tion of the revenue, be larger in most cases* than those of
ten under the control of disbursing officers of the. Army
and Navy, and might be made entirely safe, by requiring
such securities, and exercising such controlling supervi
sion, as Congress may by
officers whose appointments w ould Decemc necessary
dor this plan, taking the largest number suggested by the
Secretary of the Treasury would not exceed ten ; nor the
additional expenses, at the same estimate, sixty thousaud
dollars a year.
There can he no ilouht of the obligation of those who
arc entrusted with the affairs of Government, to conduct
them with ns little cost to the nation as is consistent with
the public interest; and it is for Congress, and ultimately
for the people, to decide whether the benefits to be derived
from keeping our fiscal concerns apart, and severing the
connection which lias hitherto existed between the Govern
ment and hanks, oiler sufficient advantages to justify the
necessary expenses. 11 the object to be accomplished is
deemed important to the future welfare of the country, I
cannot allow myself to believe that the addition to the
public expenditure of comparatively so small an amount
as will be necessary to effect it, will he objected to by the
people.
It. w ill he seen by the report of the Postmaster General,
herew ith communicated, that the fiscal affairs of that De
partment have been successfully conducted since May last,
upon the principle of dealing only in the legal currency of
the United States, and that it needs no legislation to main
tain its credit, and facilitate the management of its con
cerns* tbe existing laws being, in the opinion of that offi
cer, ample to." (hose objects.
Difficulties will jleubtlcss he encountered for a season,
and increased services b” required from the public func
tionaries; such arc usually inMdent to the commencement
of every system, but. they will be greatly lessened in the
progress of its operations.
The power and influence supposed to he connected with
the custody and disbursement of the public mou''V, are to
pics on which the public mind is naturally and, wnJ -teat
propriety, peculiarly sensitive. Much has been said o -1
them, in reference to the proposed separation of the Go
vernment from the banking institutions; and surely no one
can object to any appeals or animadversions on the subject,
which are consistent with facts, and evince a proper re
spect for the intelligence of the people. If a Chief Ma
gistrate may he allowed to speak for himself, on such a
point. 1 can truly say, that to me nothing would he more
acceptable than the withdrawal from the Executive, to the
creates: practicable extent, of all concern in the custody
and d'sh'usenient of the public revenue; not that I would
shrink fru it any responsibility cast upon me by the duties
af my office, hut because it is my firm belief, that its capa
city for usefulness is in no degree promoted by the posses
sion of any patronage not actually necessary to the perfor
mance of those duties. But under our present form of
Government, the intervention of the Executive officers in
the custody and disbursement of the public money, seems
to he unavoidable; and before it can be admitted that the
influence and power of the Executive would be increased
bv dispensing with tlie agency of bunks, the nature of that
intervention in such an agency must be carefully regarded,
and a comparison must be instituted between its extent in
the two cases.
The revenue can only he collected by officers appointed
by the President, with the advice and consent of the Senate.
The public moneys, in the first instance, must, therefore, in
all cases, pass through hands selected by the Executive.
Other officers appointed in the same way, or, as in some
cases, by the President alone, must also be entrusted with
them when drawn for the purpose of disbursement. It is
thus seen that, even when banks are employed, the public
funds must twice pass through the bands of Executive offi
cers. Besides this, the head of the Treasury Department,
who also holds his office at the pleasure of the President,
and some other officers of the same Department, must ne
cessarily he invested with more or less power in the selec
tion, continuance, and supervision, of the banks that may
be employed. Ihe question is then narrowed to the single
point, whether, in the intermediate stage between the col
lection anil disbursement of the public money, the agency
of banks i3 necessary to avoid a dangerous extension of the
patronage and influence of the Executive ? But is it clear
that the connexion of the Executive with powerful monied
institutions, capable of administering to the interests of
men in points where they nre most accessible to corruption,
is less liable to abuse, than his constitutional agency in the
appointment iml control ot* tlie few public officers required
by the proposed plan ? Will the public money, when in
their hands, be neoessarily exposed to any improper inter
ference on the part of the Executive ? May it not be ho
ped that a prudent fear of public jealousy and disapproba
tion, in a matter so peculiarly*exposed to them, will deter
him from any such interference, even if higher motives be
found inoperative ? * May not Congress so regulate, by law,
the duty of those officers, and subject it to such supervision
and publicity, as to prevent the possibility of any serious
abuse on the part of the Executive? and' is there equal
room for such supervision anil publicity in a connection
with banks, acting under the shield of corporate im
munities, and conducted by persons irresponsible to the
Government and the people? It is believed that a consi
derate anil candid investigation of these questions will re
sult in the conviction, that the proposed plan is far less lia
ble to objection on the score of Executive patronage anil
control, than any hank agency that has been or can be, de
vised;
With tliesd views, I leave to Congress the measures ne
cessary to regulate, in the present emergency, the safe
keeping and transfer of the public moneys. In the per
formance of constitutional duty, I have stated to them,
without reserve, the result of my own reflections. T he sub
ject is of great importance; and one on which we can
scarcely expect to be as united in sentiment as we are in
interest. It deserves a full and free discussion, and cannot
fail to be benefitted by a dispassionate comparison of opin
ions. Well aware myself of the duty of reciprocal con
cession among the co-ordinate branches of the Government,
I can promise a reasonable spirit of co-operation, so far as
it can he indulged in without the surrender of constitution
al objections, which I believe to he well founded. Any
system* that may be adopted should be subjected to the ful
lest legal provision, so as to leave nothing to the Executive
but. what is necessary to the discharge of the duties im
posed on him; and whatever plan may be ultimately es
tablished, my own part shall lie so discharged as to give to
it a fair trial, and the ! est prospect of success.
The character of the funds to he received and disbursed
in the transactions of the Government, likewise demands
vour most careful consideration.
There can be no doubt that those who framed and adopt
ed the Constitution, having in immediate view the depre
ciated paper of the Confederacy—of which five hundred
dollars in paper were, at times, only equal to one dollar in
coin—intended to prevent the recurrence of similar evils,
so far at. least as related to the transactions of the new
Government. They gave to Congress express powers lo
coin money, and to regulate the value thereof, and of for
eign coin; they refused to give it power to establish cor
porations—the agents, then as now, chiefly employed to
create a paper currency ; they prohibited the States from
making any thing hut gold and silver a legal tender in pay
ment of debts; and the first Congress directed, by positive
law. that the revenue should be received in nothing but
gold anil silver.
Public exigency at the outset of the Government, with
out direct legislative authority, led to the use of banks as
fiscal aids to tbe Treasury. In admitted deviation from
the law, at the same period, nnd under the same exigency,
the Secretary of the Treasury received their notes in pay
ment ol duties. . The sole ground on which the practice,
thus commenced, was then, or has since, been justified, is
the certain,-immediate, and convenient exchange of such
notes for specie. The Government did indeed receive the
inconvertible notes of State banks during the difficulties of
war; and the community submitted without a murmur to
the unequal taxation and multiplied evils of which Such a
course was productive. \V ith tlie war, this indulgence
ceased, and the banks were obliged again to redeem their
notes in gold and silver. The Treasury, in accordance
with previous practice, continued to dispense with thecur-
rency required by the art of 1739, and took the notes of
banks in lull confidence of their being paid in specie on de
mand; and Congress, to guard against the slightest viola
tion of this principle, have declared, by law, that if notes
arc paid in the transactions of the Government, it must lie
under such circumstances as to enable the holder to con
vert them into specie without depreciation or delay.
Of tnv own duties under the existing laws, when the
banks suspended specie payments, I could not doubt. Di
rections were immediately given to prevent the reception
into the Treasury of any thing but gold anil silver or its
equivalent; and every practicable arrangement was made
to preserve the public faith, by similar or equivalent pay
ments to the public creditors. The revenue from lands
had been for some time substantially so collected, under
the order issued by the directions of mv predecessor. The
effects of that order had been so salutary, and its-forecast
in regard to the increasing insecurity of bank paper had
become so apparent, that, even before the catastrophe, I
had resolved not to interfere with its operation. Congress
is now to decide whether the revenue shall continue to he
so collected or not.
The receipts into the Treasure, of bank notes, not re
deemed in specie on demand, will not, I presume, be sanc
tioned. It would destroy, \\ ithout the excuse of war or
public distress, that equality of imports, and identity of
commercial regulation, which lie at the foundation of our
Confederacy,^and would .oft'T.?oV Sfpffcratfrirrgrfife cur
rency received for duties in its ports. Surb a proceeding
would also, in a great degree, frustrate the policy, so highly
cherished, of infusing into our circulation a larger propor
tion of precious metals; a policy, the wisdom of which
none can doubt, though there may be different opinions as
to the extent to which it should he carried. Its results
have been already too auspicious, anil its success is too
closely interwoven with the future prosperity of the coun
try, to permit us for a moment to contemplate ns abandon
ment. We have seen, under its influence, our specie aug
mented beyond eighty millions; our coinage increased so
as to make that of cold amount, between August, 1834,
and December, 1836, to ten millions of dollars : exceeding
the whole coinage at the mint during the tliirty-one previ
ous years. The prospect of further improvement continu
ed without abatement, until the moment of the suspension
of specie payments. This policy has now indeed been sud
denly dice'-ed, but is still far from being overthrown.
Amidst all conflicting theories, one position is undenia
ble : the precious metals will invariably disappear when
there ceases to he a necessity for their use, as a circulating
medium. It was in strict accordance with this truth, that
whilst, in the month of May last, they were every where
seen, and were current for all ordinary purposes, they ilis-
moment the payment of spe
SU3-
em-
allcgcd as an objection to Such a regulation. I tJ r i •
and motive are their convenience and welfare. ‘ Jfct
If, at a moment of simultaneous and unexpected
pension by the banks, it adds something to the many
barrassments of that proceeding, yet these are far ov'. rh l
anccd by its direct tendency to produce a wider ciicidn '
of gold and silver, to increase the safety i f l.nnl
improve the general i
er such occurrences,
that attend them.
It may, indeed, 1 c questioned, whether it is r.ot f„ r q
p niTnint
acted
pccic omy m ns iransacuons, me Government would cre
ate a demand for it. which would, to a great extent
v, x . . . event
itscxportation, ana by Keeping it in circulation, maintain
broader and safer basis for the paper currency. That’ll
lie rendered more sound, and the com-
of gold and silver, to increase the safety of bunk
l currency, and thus'to prevent almJ ’ o"
3, and the other and fai greater evil*
-- „ / j 'X T ”**v 11*0 I It IS r.ot
interest of the hanks themselves that the Govt.,,,
should not receive their paper. They would be cor'dii
with more caution, and on sounder principles. p v ,
specie only in its transactions, the Government wnnl.i
o ex-
out
pc-
law prescribe. Tlie principal appeared from circulation the
s would become necessary un- < c i° ' vn;l refused by the banks, and the community tacitly
agreed to dispense with ks employment. Their place was
supplied by a currency exclusively of paper, and, in many
cases, of the worst description. Already are the bank
notes now in circulation greatly depreciated, and they fluc
tuate in value between one place and another; thus dimi
nishing and making uncertain the worth of property and
the price of labor, and failing to subserve, except at a hea
vy loss, tlie purposes of business. W ith each succeeding
day the metallic currency decreases; by some it is hoarded
in the natural fear, that, once parted with, it cannot be re
placed; while by others it is diverted from its more legiti
mate uses, for the sake of gain. Should Congress sanction
this condition of things, by making irredeemable paper
money receivable in payment of public dues, a temporary
check to a wise and salutary policy will, in all probability,
he converted into its absolute destruction.
It is true that hank notes actually convertible into spe
cie may tm received in payment of the revenue, without
being lialue to all these objections, and that such a course
may, to some extent, promote individual convenience; an
object a 1 wavs to be considered where it does not conflict
with the principles of our Government or the general wel
fare of the country. If such notes onlv were received,
anil always under circumstances allowing their curly pre
sentation for payment, anil if, at short and fixed periods,
they were converted into specie, to he kept by the officers
of tho Treasury, some of the most serious obstacles to
their reception would perhaps he removed. To retain
the notes in the Treasury would be to renew, under ano
ther form, the loans of public money to the Banks, and
the evils consequent thereon.
It is, however, a mistaken impression, that anv large
amount of specie is required for public payments. Of the
seventy or eighly millions now estimated to be in the
country, ten millions would be abundantly sufficient for that
•urpose, provided an accumulation of a large amount of re-
veti-i ** beyond the necessary wants of the Government, he
hercatu'Circventcil. If to these considerations he added the
facilities wi.’oh will arise from enabling the Treasury to
satisfy the public*creditors by its drafts or notes received
in payment of the public dues, it may be safely assumed
that no motive of cotr'Cniencc to tbe citizen requires the
reception of bank paper.
To say that the refusal of paper money by the Govern
ment, introduces an unjust discrimination between the cur
rency received by ir, and that used I v* individuals in their
ordinary affairs, is, in my judgment, to view it m a very
erroneous light. The Constitution prohibits tlie States
from making any riling but gold ar.d silver a tender in the
payment of debts, and thus secures lo every citizen a right
to demand payment in tlie legal currency. To provide by
law that the Government will only receive its dues in gold
and silver, is nor. to confer on it any peculiar privilege;
but merely to place it on an equality with the citizen, by
reserving to it a right secured to him by the Constitution.
It is doubtless for this reason that the principle has been
sanctioned by successive laws from the time of the first
Congress under the Constitution, down to the last. Such
precedents, never objected to, and proceeding from such
sources, afford a decisive answer to the imputation of ine
quality or injustice.
But, in fact, the measure is one of restriction, not of
favor. To forbid the public agent to receive in payment
any other than a certain kind of money, is to refuse him
a discretion possessed by every citizen. It may be left
to those who have the management of their own trans
actions, to make their own terms ; but no such discretion
should be given to him who acts merely as an agent of
the people, who is to collect what the law requires, and
to pay the appropriations it makes. When bank notes
are redeemed on demand, there is then no discrimination
in reality, for the individual who receives them may, at
his option, substitute specie for them; he takes them from
convenience or choice. When they are not so redeemed,
it will scarcely be contended that their receipt and pay
ment, by a public officer, should be permitted, though
none deny that right to an individual; if it were, the ef
fect would be most injurious to the public, since their offi
cer could make none of those arrangements to meet or
•puird against tlie depreciation, which nn individual is at
liberty to do. Nor can ir.convenic: cc to the community he
dunks would thu
nmnitv more safe, cannot admit of a dealt.
The foregoing views, it seems to me, do but fnirlv r-
ont tbe provisions of the Federal Constitution in relatio'
to the currency, as far as relates to the public revet .
At the time that instrument was framed, there were l
three or four hanks in the United States ; ar.d had th
tension of the banking system, and the evils grmvinr
of it, been foreseen, they would probably have been
daily guarded against. The same policy which led to'!;
prohibition of hills of credit by the States, would ilmd t
less, in that event, huve also interdicted their issue ns
currency in any other form. The Constitution, however
contains no si ch prohibition; and, since the States have
exercised, for nearly half a century the power to regulate
the business of banking, it is not to be expected that it
will be abandoned. The whole matter is now umi r dis
cussion before the proper tribunal—the people of the States
Never before has the public mind keen so tLorouirfljy
awakened to a proper sense of its importance; never°)ia*
the subject, in all its bearings, been submitted to sn searri
ing an inquiry. It would be distrusting the iim*lli"er-'
and virtue of the people to iloubt the speedy and efficient
adoption of such measures of reform as the public
demands. All that can rightfully be done by the Federal
Government, to promote the accomplishment of that i n -
portant object, will, w ithout doubt, be performed.
In the mean time, it is our duty to provide all the remr
dies against a depreciated paper currency which the Coe.
stitution enables us to afford. The Treasury Department
on several former occasions, lias suggested the propriety
and importance of a uniform law concerning bankruptcies
of corporations, anil other hankers. Through the instru
mentality of such a law, *. salutary check niuv doubtless lie
imposed on tlie issues of paper money, ami an effec:ua[
remedy given to the citizen in a way at once equal in all
parts of the Union, and fully authorized by the Constric
tion.
The indulgence granted by Executive authority in tie
payment of bonds lor duties has been alreadv mentioned
Seeing that, the immediate enforcement of these obligations
would subject a large and highly respectable portion ot'
our citizens to great sacrifices, and believing that a tem
porary postponement could be made without detriment to
other interests, and with increased certainty of ultimate
payment, I did not "hesitate to comply with the request
that was made of me. The terms allowed are, to the |
extent, as liberal as any that are to be found in the prac
tice of the Executive Department. It remains for Con
gress to decide whether a further postponement mav not
wi*h propriety he allowed, nnd if so, their legislation upon
the subject is respectfully invited.
The report of the Secretary of the Treasure will exhi
bit tlie condition of these debts; the extent and effect of
the pn-esent indulgence; the probable result of its further
exte; sion on the state of the Treasury, and every other fact
necessary to a full consideration of the subject. Similar
information is communicated in regard tosnchilrpositi ries
ot the public moneys as are indebted to the Government
in order that Congress may also adopt the proper mea
sures in regard to them.
The receipts and expenditures for the first half of tin*
year, and an estimate of those for the residue will he l a j,j
before yon by the Secretary of the Treasury. In bis re
port of December Inst, if was estimatfd that the current
receipts would fall short of the expenditures by about t'hrco
millions of dollars. It will be seen that the differcEce will
lie much greater. This is to be attributed not only to tho
occurrence of greater pecuniary embarrassments in the
business of the country than those which were then pre
dicted, ai d, consequently a greater diminution in the re
venue, hut also to the fact that the appropriations exceed
ed, by nearly six millions, the amount which was asked for
in the estimates then submitted. The sum necessary
for the service of the year beyond the probable receipts,
and the amount which it was intended should be reserved
in the Treasury at the commencement of the vear, will bo
about six millions. Jf the whole of the reserved balance
be not at once applied to the current expenditures, but four
millions be stid kept in the Treasure, as srems most expe-
dio;.t, for the uses of the mint, anil to meet contingencies,
the sum needed will lie ten millions.
In making this estimate the receipts are calculated on
tho supposition of some further extension of the indulgence
feet ihe amount of the revenue for the present year to the
xtent of two and a half millions.
It is not proposed to procure tbe required amount by
loans or increased taxation. There are now in the Trea
sury nine millions three hundred and sixty-seven thousand
two hundred ar.d fourteen dollars, directed bv the act of the
23d of June, 1836, to be deposited with the States in Oc
tober next. This sum, if so deposited, will he subjert,
under tlie law, to bo recalled, if needed, to defray existing
appropriations; and as ir is now evident, that the whole, or
principal part of it, will be wanted for that purpose, it ap
pears most proper that the deposite should be withheld.
Until the amount can be collected from the banks. Treasa-
ry notes may be temporarily issued, to be gradually re
deemed as it is received.
I am aware that this course mav be productive of incon
venience to many of the States. Belying upon the acts of
Congress which held out to them the strong probability, if
not the certainty,'of receiving this instalment, they have in
some instances adopted measures with which its retention
may seriously interfere. That such a condition of things
should have occurred is much to be regretted. It is not
the least among the unfortunate results of the disasters of
the times; and it is for Congress to devise a fit remedy,if
there be one. The money being indispensable to the w ants
of the Treasury, it is difficult to conceive upon what prin
ciple of justice or expediency its application to that object
can be avoided. To recall any portions of the sums al
ready deposited with the States, wculd be more inconve
nient and less efficient. To burden the country with in
creased taxation, when there is in fact a large surplus re
venue, would be unjust and unwise; to raise moneys by
loans under such circumstances, anil thus to commence a
new national debt would scarcely be sanctioned bv the
American people.
The plan proposed will be adequate to all oil r fiscal ope
rations, during the remainder of the vear. Should it be
adopted, the Treasury, aided by the ample resources of the
country, will he able to discharge, punctually, every pecu
niary obligation. For the future, all that is needed will 1 o
that caution and forbearance in appropriations which the
diminution of the revenue requires, and which the complete
accomplishment or great forwardness of many expensive
national undertakings renders equally consistent w ith pru
dence and patriotic liberality.
The preceding suggestions and recommendations are
submitted, in the bclit f that their adoption by Congress
will enable die Executive Department to conduct our fiscal
concerns w ith success, so far as their management has been
committed to it. Whilst the objects and the means propo
sed to attain them are within its constitutional powers anil
appropriate duties, thev will at the same tim", it is hoped,
by their necessary operation, afford essential aid in the
transaction of individual concerns, ar.d thus yield relief to
the people at large in a form adapted to the nature of our
Government. Those who 1™ k to the action ot this Go
vernment for specific aid to the citizen to relieve embarrass
ments arising from losses by revulsions in commerce and
credit, lo e sight of the ends for which it was created, anil
the powers with which it is clothed. It was established to
give security to us all, in our lawful and honorable pursuits,
under the lasting safeguard of republican institutions. It
was not intended to confer special favors on individuals,or
on any classes of them ; to create svstems of agriculture,
manufactures, or trade; or to engage in them, either sepa
rately or in connexion with individual citizens or organized
associations. It its operations were to he directed for tho-
benefit of any one class, equivalent favors must, injustice,,
be extended to the rest; and the attempt to bestow such
favors with an equal hand, or even to select those who
should most deserve them, would never be successful.
All communities are apt to look to Government for too
much. Even in our own country, where its pow ers anil du
ties arc so strictly limited, we are prone to do so, espe
cially at periods of sudden embarrassment anil distress.
But this ought not to be. The framers of our exce eni
Constitution, and the people who approved it will) ra m
and sagacious deliberation, actel at the time on a scun er
principle. They wisely judged that the less Governmcn
interferes with private pursuits, the better for the genera
prosperity. It is not its legitimate object to "? on
rich, or to repair, by direct grants of money or
in favor of particular pursuits, Josses not incurn
public service. This would be substantially to .ice f
perty of some for the benefit of others. But its tea i u^
—that duty, the performance cf which makes °.g p0 ’ ft
vernment the most precious of human blessings ■= t0 * ^
and enforce a system of general laws commensurate ’
but not exceeding, the objects of its establishment, an
leave every citizen and every interest to reap, un
benign protection, the rewards of virtue, industry,an p
donee.
I cannot doubt that on thi
the Federal Government will find its agency j, en limit-.
cive to the security and hap; in ess ol the people, w ^ evCr ag _
ed to the exercise of its conceded powers. ^ WC rc
suming. even for a well meant object, •‘ !Ut l ?I’ 0 '^ reality do
not designed to be conferred upon it, wo ' fta _
most for the general welfare. T° avonl reguU £
interference with the pursuits of the citi ,
„d„ P .
sist limited interests, and are eagerly. L p l ,
ly, sought for, under the pressure of tempora *
ces. If, therefore, 1 refrain from suggesting to Congress
any specific plan for re'uluting the exc or ? cs .
a3 on all similar occasions,
most cordu
interfering
with the ordinary operations ot foreign ot dome.-tic r °(’‘
merce; it is frern a conviction that such measures are bo|
try; relieving mercantile embarrassment: