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THE REFLECTOR.
MILLEDGEVILLE, G. TCESbAY, JUNE 25, isia.
.NO. 33»
BANK IXO.
NlLEs’ WEEKLY ULOISTER.
lie instrumentality of commerce,
of one nation arc supplied from the
iof another, a country where la-
atrrials are cheap, will always be
in the manufactures of one in which
hy underselling them in their
et. Before 1 apply this great aiid
c truth to the subject of my present
will distinctly premise that I do not
liter upon the question which has
much discussion, as to the possibi-
U. States becoming in their present
a great manufacturing nation. My
this paper, is to enquire into the
the great paper system on a particu-
f the community, and 1 wish sed-
n/.aid the discussion of any other
at may weaken the effect of my
by exciting opposite opinions,
particular relation to my present
AVith this explanation, I shall pla
in y undertaking.
it necessay 1 trust to offer argu-
[provc that (lie value of money, lias
ted in the United States, in eonse-
f the countless millions of paper
ow in circulation, since the experi-
cvery man will demonstrate this
Neither is it worth while to detain
i proofs that the prices of labor, an
materials have greatly increased, nl-
not iu an equal ratio, particularly
je,r.— flic sane experience is .here al-
y sufiii ient; Now, the manufacturers
nited States cannot meet this rise in
nd raw materials, hy a correspond*
for their manufactures, because
le market is open to foreign nations,
sed with such a redundancy of paper
ere of course every thing is cheap
cy, will immediately come into our
and undersell them. Poor nations
ays undersell rich ones ; and this is
the great—1 speak seriously,sir,—
To disprove the first it is only necessary sanction, or duties that the peoplo will not
pay, can possibly* save them from ruin.—
to repeat, that the domestic manufacturers
of goods, cannot keep pace with the high
pvico of labor and raw materials, because
TAPER SYSTEM—NO. lA r . the poorer nations will undersell them, Con-
l the present stale of the world, scquently, as they cannot sell their goods
without loss, the more goods they manufac
ture, the greater will be their loss ; and thus
the means ol'extending their business afford
ed by the great plenty of rags, and the facili
ty of procuring them from the hanks, only
precipitates their ruin.
But there is yet another point in which, this
subject is io be viewed. Nobody that I have
ever heard of, has ventured to broach the
absurdity, that the depreciation of.money
actually increases either the value of labor,
or of real property. The only advantage
then resulting from the great plenty of de
preciated money, must be the facility in pro
curing, hy means of this plenty, au additi
onal capital, which is done by borrowing of
the batiks, or brokers, now the only lenders.
I will therefore proceed to shew, how the
decrease in the value of money operates en
tirely to the disadvantage of the borrower.
It would seem indeed, and it is thus argued
by the defenders,—for it has no advocates—
of the paper eystem—that if the borrower
pays the interest ami principal of his loan,
in the same depreciated medium, lie sus
tains no loss hy its depreciation, 'Eli
reasoning is utterly unfounded, as 1 will pro
ceed to demonstrate. The use of money is
always more profitable to the borrower, than
the lender—that is to say, the former can
so apply it, as to make it produce a greater
interest than he pays —else there would be
no advantage in borrowing, and the argu
ment I am combatting would fall to tlicgro im'.
of itself. The borrower is enabled to d-
tliis, either by the profits of liis own labor,
or the labor of those he employs. This i-
what is called productive labor—the only re
al source of national w r;lth. It is here the
paper system piiirh s. It is in the sensible
diminution of tin value of this urochu vi-
labor, that the |, various ©p.*t;• • *•-.»» mi,
deprec iation in ti.ie value of m. n e, io ai./"
he many great blessings of nationalVi!.’ u ' ,r! . u :l . ' in\ os«.
. There are hut two wavs to protect 1,1W * ls l*
Such sir, are the inevitable effects of the
high prices of labor and materials, produced
by the enormous emission of paper money,
an the manufacturers of the United States.
If it be asked why the same causes do not
produce the same effects in Great Britain,
1 answer, the cases are not parallel, because
labor in hat country heurs no proportion to
the increased price of every thing else, and
hence it is that the great manufacturers still
maintain a precarious existence, while the
laboring classes are in a state of abject dis
tress. Did the price of labor in England
correspond with the high price of every
thing else in that country by the operation
of the paper system, there is not a nation in
Europe that would not undersell the British
manufactures in every market. It is the dis
tresses of the laboring classes in England,
tnat enables her with her paper system, still
to undersell the world.
pi
manufactures in such a rase : the
to put down the paper system and
cstorc the old value of money ;—
ier, high duties and pi'olitfbrtions
ig9 goods to prevent their iutroduc-
prohibiting, or duties greatly en-
g the price of foreign inanutiu tores,
deed force the people to buy-domestic
and they will also enable the iiiaiiu-
•s at home to hold them at a price
Hiding with time of labor, and raw
Is. But these prohibitions are marii-
njust. to every other class of the com
for there exists no social tie hindini
"y of men hy their necessities, to
sc of another at a great price, what,
s were left to their natural course,!
uld procure on much more reasonable
Men arc not called upon to make
orifices to each other, by any ubliga-
the social compact, which never de-
of all the other classes of the eotninu-
become tributary to one. It is at
tahlishing a privileged order, incom-
witli the spirit of all our institutions,
“ii if this were hot the case, it is not
pected that the representatives of
•rent, classes of people in the United
will ever be induced to levy so great
lit their constituents, until a majority
ir constituents shall be manufacturers,
esc general premises are true, it ro-
at the only practicable remedy for the
,:esso loudly complained of hy the
clurers, is to put down by the
aper system, by the free and sove-
ill of the people—by w hose sufferance
’ exists, and on whose senseless crcdu-
lotic is sustained. This will at once
the capital of the country from a no-
o a real standard—consigning it to
it was wont to do, through regular
s from which it is now diverted—and
areal value to real money,that will at
■ down the nominal price of labor
every thing esscnlial in manufar-
And here it becomes necessary to ex-
two great fallacies of the paper
tlie pillars on which it rests. The
that the, depreciation of money ope-
a circle—that is to say, that the cor
ing plenty, makes amends to all
fertile diminution in its value ; mid
,that the facility of procuring a false
by bank discounts, makes ample a-
or the diminution of value of the real
shall proceed to demonstrate that
se propositions arc eminently false
pect to the manufacturers ; and in a
ittcr, I trust, I shall equally prove
tacious in their application to every
ass of the community, except that
ways prospers, in the decay of a na-
e honorable band of brokers and
ora.
of the subject, and as general. reasonings,
on intricate subjects are apt to be rat hi r in
distinct, I will endeavor to make my meuir-
ing plain, by a plain example.* lam ntfitf-
i-ms to shew the. people of .this abused, swin
died nation, what this boasted advantage is
which is thus supposed to overbalance the
evils of a ragged depreciated currency—
worthless in proportion to. its plenty—and
hearing no specific equal value at any two
places, for the present enjoyment of having
tlr ir honest gains diminished by the plenty
which surrounds them, arid for the consoling
prospect of a relief from these evils hy
bankruptcy ten times more extensive in its
consequences, than the downfall of continen
tal money ;—for the oppressions of an up
start unprincipled aristocracy that grinds
then to dust ; and far the facilities afforded
a useless, nay pernicious hand of broker
and speculators, the despicable progeny of a
despicable system, in picking their pockets.
Suppose I borrow a hundred dollars, for
which I pay seven per cent, per annum—yon
perceive 1 don't mean to borrow of a broker !
I ain enabled by my productive labor to em
ploy this money, so as to make it produce me
fourteen per cent. The surplus seven per
cent, is my clear gain ;—it is from the sweat
of my brow, the labor of my hands—and on
such gains I live. But if this value of my
productive labor, is depreciated one half,
insteadof seven per cent, I virtually gain
bid three end a half, and the difference is,
that instead ol‘being enabled to live, comfort
ably, I starve. But this is not all—there is
something yet to come. Not only the worth
of my labor,-but the worth of my borrowed
hundred dollars is diminished one half, by
this depreciation in the value of money. I
cannot buy half the raw materials with it,
that 1 could twenty years ago, and conse
quently my business suffers, first by the de
predation of my profit, and secondly—by
tiie depreciation of the means by which I ex
tended my business. But here again comes
in the circular system of reasoning to which
I have before alluded. I must so proportion
my profits as to make up this deficiency.—
But 1 have already dearly shewed that the
manufacturer cannot do this without being
undersold hy foreign dealers, and the same
will apply to every class of mechanics and
laborers, who are dependant on the rich for
employment. I have endeavored to make
tins matter plain—and I hope I have sue
cccdeil, for it is here, that the round-abokt
reasoning which goes to prove that the great
plenty of money operates alike on the lender
and the borrower, is arrested in its circle,
by an obstacle that no reasoning has ever yet
been able to surmount. In vain therefore
will the manufacturing interest expect to
flourish while this paper system flourishes.
Nothing b.ut its downfall, or a prohibition of
foreign importations which congress cannot
But the evils inherent in thc^reat paper
system, are heightened, ns is generally tin
case with every bad system, by those abu
ses, that will ever be the. consequence of
placing a.power in tuc hands of men, to the
abuse of which they are tempted by the ir
resistible Io\c i f gr n —anil for the abuse ol
won i they are not responsible to any human
tribunal. This brings me to a consideration
oi the general unprincipled system of con
duct pursued by a great portion of the banks
towards every other class of the community.
1 call it unprincipled—for 1 know not what
other name to apply to a system, which acts
under the uniform influence of a total disre
gard to the interests and the happiness of •<
(tiers, and which could not he tolerated in
any country, where legislative purity, or le
gislative wisdom, was not exactly-in an in
verse ratio with the quantity of paper rags
f assert, sir, and I will establish it by refer
ui& io ttie records of our courts, for thou
sands of proofs of the fact, in the number
*t suits brought at every term by banks a-
-ins! real capitalists—1 assert that the gram
bject of tlie banks, since they stopt pay-
-n ut, and persisted in evading their promises,
even when they pretended to assume the pay
ment of specie—has been the substitution of
real property in the place of their rags.—
Their whole policy has been to give a basis
of reality to that which hud none before.—
This suspension -let us give it a plainEnglish
name—Inis total and final suspension of sp
ciu pay incuts, was the signal for the creation
of litters of banks in every part of the mid
dle and western states, under the auspices of
various combinations of needy speculators,
without capital or principle, who being at
once by this great blow at the national pros
perity, freed from the necessity of paying
their debts, and gifted with the privilege of
coining their own money, had no limits to
their cupidity. Their resources were the
credulity of the people, and their joint funds
the great stock of national folly. But they
felt even in the midst of their prosperous
career, that credulity is not everlasting, and
that nations sometimes suddenly recover
their wits. It became necessary therefore
in order to perpetuate the blessings of this
happy- age of paper, to take advantage of
this folly and credulity while they lasted, so
effectually as to render a return of the peo
ple to their senses unavailing.
It was a simple method they pursued, for
they had simpletons to deal with. They got
rid of as many of their rags as possible, ei
tlier by lending them out, and taking the se
curity of real property ; or hy employing
fellows to go hawking and periling them the
country- round, for which they received
commission at so much per cent. It may he
objected, that this ingenious method of pay
ing a premium on passing away one’s own
money, would inevitably produce the ruin
of the lender in the end. And so it would
but for one thing. It ought, to he understood
that one of the first acts of these contcrnpti
hie little paper banks, is to enter into a kind
of partnership with one or- two, or three ci
ther little contemptible institutions, in dif
ferent places, for the neighborly exchange
of each others’ notes, and for the purpose
of negotiating the support of each others'
credit! AVe shall see now what advantages
this produces.
In process of time the notes thus palmed
upon the people by the banks,their tra
velling agents—come horiie^fEfn for pay
ment—and if paid at all-p^PR-is in any real
value—the poor bank.w'oiffj he in danger of
bankruptcy ! But they are not paid—ckcept
by other rags equally depreciated, which the
other banks of tins righteous partnership
kindly furnish each other to pay their debts.
The honest dupe hereupon goes to the bank
whose notes had been given him to pay the
notes of the other bank—and here lie is offer
ed the notes of the very bank lie had just come
from. Thus the creditor is bandied about
from one to the other until he submits in des
pair to the imposition, and goes and does as
well as lie can with rags. If lie should pro
secute the bank for the amount of the debt,
a clamor is raised against him, sufficient to
deter the stoutest heart;—he is persecuted
by the whole clan of paper manufacturers ;
he suffers all the keen effects of awakening
the enmity of a body of men as powerful as
unprincipled in their hostility; and if he
persevere in his demand of justice, his claims
are tried by a jury, one half of whom per
haps arc at the mercy of tlie banks, and de
villed according to laws propounded by a ma
gistrate who is himself, a bank director, or
if not, whoso interests or the interests of
some of his friends are dependant on the
good will and pleasure of the members of the
great paper aristocracy. Is not this a plain
statement, which every body knows is true—
of tlie combinations of banks to cheat the
people—to frighten them from resorting to
the law—and to render that resort ineffectu-
tl, sufficient to excite alarm, in every re
flecting mind ? Does it not strike directly
t thu security of property ; the freedom of
seekingjustice ; the possibility of obtaining
in short at every thing dear, and csscn-
lal to human happiness ? Individuals dare
not prosecute the very banks that arc every
day prosecuting without remorse these very
udividuals. When we consider in addition
to all this, that the banks, by beingthus virtu-
Ily exempted from paying their debts, are
tiius left at free liberty to create out of others
the means of buying and selling, human con
sciences—of tempting and punishing; ofex-
ending their influence ever legislative and
.tdicial bodies ; of drawing the people frhm
pposing or chastising their faithlessness j of
preventing their attaining justice ;—when
consider all this, sir—is it not certain—
ibsolutely certain, that if the paper system
is not immediately circumscribed in its means
if acquiring influence—the whole property
if the country—and the sum total of the
.gilts of the people will be at its mercy ?
As the nation is now situated, the honest
part of it, which alone is worthy of protec
tion and sympathy, is unconditionally at
the mercy of the. paper aristocracy. I say
unconditionally, because when a privileged
body of men are permitted to carry on their
affairs in secret—to art on motives which they
dare not own, and cannot justify—to claim
the privilege of guilt in not telling any thing
that may condemn—to put the law in force, a-
gainst others, anil to evade it themselves—
to issue rhgs, without the necessity of re
deeming them, ex'ept by other rugs—while
nil this continues, who shall dare to say that
the honest part of the community is not laid
unconditionally at the feet of an order if au
thorised swindlers, who began with nothing
hut are gradually swallowing up the proper
ty of the farmer and manufacturer and tlie
gains of honest labor ?
There is some little consolation in the
midst of slavery in knowing that our mas
ters are good and worthy men, vo whom the
power is not the warrant for its abuse, and
w hose estimation in society is a guarantee
for justice and moderation in the exercise of
their preogativc. But, alas ! such consola
tion is not our’s !—we are unhappily subject
ed to a different—far different dynasty.
Men who feel a consciousness that money is
the only thing that can, hy any possibility,
elevate them to an association with respecta
ble human beings, and whom nature has de
barred from the exercise of any other means
of acquiring influence, but money, will n it,
I fear,—away with such mincing terms—will
not, and arc not—and cannot be scrupulous ae
to the attainment of this only means of giv
ing themselves importance. Nay, experi
ence justifies the conclusion, that they will,
in time, come to consider every method of
obtaining money, that does not subject them
to the penalty of the laws, as justifiable.
From this state in which the mind acquiesces
in a welcome delusion, there is but one stop
to the most possible corruption of the heart,
when it l'ecls a pride in dexterously employ
ing bad means to the attainment of bad
ends. It is in this deplorable state of moral
perversion, that the highw-ayman will tri
umph in the intrepidity of his murders—the
thief in tlie superior dexterity of his nightly
depredations—and that the brokers, specu
lators and trash which constitutes the paper
aristocracy, will, like the hardened prosti
tute, boast of the number of their victims.
From an aristocracy, thus mainly consti
tuted, whose wealth is obtained by tlie sa
crifice of the wholesome morals, the whole
some prosperity, and the precious freedom
of the nation, I wuuld wish to warn, and do
most solemnly w arn, the people of these Uni
ted States. To guard that gallant, and yet
virtuous people, from the effects of a system
that debases the human mind, and destroys
that strong feeling of personal independence,
which is the safeguard of their rights, the
basis of their freedom, I have taken up my
pen. I have employed the term aristocracy,
which is often used in our country with -ut
being understood, in its general signification.
AVe are authorised to apply it exclusively to
the lendal barons of old, and their succes
sors the titled nobility, of the present day.