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H. OF R.]

Sub-Treasury Bill.

because of the new demand for coin created by the exigencies of trade. They have not yet resumed, because although that demand has entirely diminished, as shown by the rate of foreign exchange, yet there is still demand enough to warn them of the consequences of an attempted resumption, before the trade of the country is in a fit condition to bear it. Sir, the country is recovering fast from the violent and sudden convulsion into which it has been lately thrown. It cannot otherwise be, when we consider the immense resources of this vast continent, wielded, as they are, by a people whose industry and enterprise acknowledge no other limit than the very bounds of the earth. But the Government must keep its hands off'; time must be allowed for the system to react, before any new or additional pressure can be borne.

If the necessities of circulation are not strong enough now to bring specie into general use, as part of the currency, because of the existing collateral demand in trade, does it not necessarily follow, that any new demand will have an additional effect in retarding that operation?

You create this new demand by the bill under consideration; pass it, and you at once increase the preinium that specie already bears over the ordinary currency; you give it increased value in the market to the extent of such new demand; and to that same extent you postpone the day when it can return into use as a part of the circulating medium. Unti! that day comes, it is impossible for the banks to pay out specie upon their notes; they never can do so, until the demand upon them is reduced to a naked demand for circulation. If I am correct in this reasoning, the best that could be hoped for under the proposed law would be, that it should remain a dead letter upon the statute book.

I think I have shown that we could have no return to a circulation of specie under its auspices; and, if this be so, do you believe, does any man believe, that the law could be carried into effect?

What, sir, that the Government alone should be paid in silver and gold, while those who have the payments to make receive nothing but irredeemable paper! How vain and idle it is to expect any such thing. If, by any chance, or lucky accident, over-ruling those stern necessities to which all human affairs are subject, the exigency of the times should have passed by, before your policy begins, then it might, thus chance-favored, be that the scheme could be carried out. But it becomes us not to legislate upon such improbable contingencies. I want no better evidence of what the Government would be twelve months hence, under the operation of this law, than what is now daily passing before our eyes. There are, it is said, (and I presume with an approximation at least to the truth,) now in this country eighty millions of dollars in coined metal. By the existing law, (as there is no bank paper convertible into specie,) Government can now receive nothing but coin in payment of any part of its revenue. I ask, confidently, is any part of that revenue so paid? With all this abundance of the precious metals, fully three times as much as we have had at any former period, do we not all know, that none whatever is paid into the Treasury from any source of revenue. I mean none, when compared even with the lowest necessity of the public service. The mint, it is true, does furnish a small supply, barely sufficient, if at all, to meet those demands which coin alone will satisfy. But this does not come in any shape of revenue-far from it. It is purchased by Government, at market rates, and a premium paid upon every dollar that is brought in. Such is the present state of things, under the operation of a hard-money law, while the only money of the country is in irredeemable paper; and such must ever continue to be your condition, under the operation of any laws that you may pass, so long as

(Oct. 11, 1837.

the money which you require is banished, by whatever
cause, from the channels of circulation.

I lay down, then, this position, and defy any refutation:
that the Government must, as a permanent necessity, deal
in that currency in which the people deal; it is the law of
its creation and inseparable from its condition. It must re-
ceive what the people receive, and pay what they pay—a
necessity from which Government cannot escape if it would,
and ought not if it could.

I speak of this as a permanent necessity, distinguished from the necessities of immediate want. It is struggling now against this very want, and precisely as any large capitalist might equally do, by using the resources of its credit to supply the temporary absence of revenue. Have we not just passed a law, authorizing an issue of ten millions of Treasury paper, for this very purpose? I mean for the single purpose of reserving the Government from the necessity of coming down at once to the irredeemable paper of the banks. And this only to answer the present emergency; for it will certainly follow, unless that medium can be restored, in which alone the Government is allowed to deal, that we must issue at least ten millions more, before we return home from the ensuing session. Sir, I went cordially with you in this use of Government credit; and I will do so again should the emergency continue. But I tell you fairly and candidly, and I tell the people, too, that this Treasury issue is all that saves the Government now from coming down at once to bank paper. I say this, sir, because your revenue laws, exacting gold and silver, are not and cannot be enforced. If you collect any revenue, it can only be in that very paper, because there is nothing else to pay with.

Suppose, then, your law passed, and the currency remain, as under such policy it inevitably must, in the condition that it now is; what are you to do? If you could enforce the law then, I ask why do you not do so now?

Why do you not now compel your debtors to go into market and buy specie, in order to replenish the Treasury? So far from this, we have now a bill before us, and which it is admitted on all hands must pass, to save the Secretary from the necessity of so idle an attempt. With more than four millions of dollars now due in New York alone, so far from exacting payment, we are about to give further time on all bonds due and to become due between this time and the next session of Congress.

I say, then, confidently, pass what law you may, you cannot have your revenues paid in specie, so long as it remains at a premium; and that the very first effect of this law, by creating a new demand, would be to increase the premium, and thus render permanent the very exigencies to which your legislation is now actually yielding.

But take another view of the subject. Suppose the law carried out, what then would follow? The importer, besides all other charges for freight, insurance, duties, &c., is required to pay five or ten per centum for specie to pay the duties. Certainly this latter would be added to the price of the commodity; and thus the whole effect of your policy would be to tax the people to this extent, in order that Government might deal in gold, while they were left to struggle on, unaided, against all the ills of worthless paper money.

My view of the subject, then, is that, by passing this law now, you postpone to an indefinite period the resumption of specie payments by the State banks; that until they do resume, the law must be inoperative, and the Treasury supplied by loans; or, if enforced, besides creating a new and heavy tax upon all foreign merchandise, the sole effect will be to enrich the officeholders, and all who feed upon the public crib, at the expense of the rest of the community. I know, sir, that this last objection has been scouted as mere slang, as part of a mere "rabble," and unworthy of notice. But I tell you that it has never been met, and that it cannot be overthrown. I do not believe (and tha

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disbelief is founded on the experience of the present day) that such a law could be carried out; but if it were, the host of Government dependants would grow rich under it. They would have money worth five or ten dollars more in the hundred than the money used by the people; and the people would be taxed to the extent of this five or ten dollars in the hundred, to furnish the former with the

ter currency.

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[H. OF R.

ments to the Treasury and to a resumption of specie payments. And, again, in proof of that position, he says, speaking of the deposite banks, that since the 1st of May, their discounts, as a whole, have been reduced about $20,388,776; their circulation $4,991,791; and their public deposites $15,607,316, while their specie has dibet-minished less than $3,000,000." Such is the encouraging account which the Secretary himself gives us of these institutions. We have already seen the great reduction in exchange since our session began, evidencing the rapid extinguishment of the foreign debt, and the effects manifested by the approaching market for the Southern staples. Even the presentation of the bill for an issue of Treasury paper, had an effect in bringing down exchange. Putting all these things together, we may safely argue that the evil day is passing by; and all that I urge upon you is, to keep hands off, and let very well alone.

Now, sir, in all this, my sympathies are with the tax payers, and not with the tax gatherers. I go for the interest of those who are to pay, and not for those who are to receive. I cannot agree to any policy which might, and I believe would, lead to these results. It is unwise, unjust, and unnecessary; and it could not, and ought not, to stand one day after those results are ascertained.

I may express myself strongly, but I do not mean to do so harshly. I see mischief and disaster without end, in any attempt to legislate now as you would have us do by this bill; and it is to save ourselves from utter defeat and shame that I beg you to pause with me, and consider the consequences of such an attempt.

Let me, before leaving this part of the subject, present another view, which, to my mind, increases the difficulties to be encountered by the proposed law. I have, so far, considered only the demand arising under the accruing revenue, as that which is to retard the resumption of specie payment. But the revenue in arrear, that of which we are to postpone the payment, will come heavily in aid to increase this demand at the very outset of the new law; to what extent we do not as yet very certainly know, but, reasoning from what we do know, the promise is sufficiently appalling. The duty bonds to be postponed, amount in New York alone to more than 7,000,000 dollars, computed to January next, and, including the other cities, to more than 10,000,000 dollars; constituting, to such extent, whatever it may be, an obstacle at the outset, over and above what is to be encountered in its ordinary course.

I have heard it said, however, that this very demand to be created under the law, will have the effect of bringing in specie to meet it; and thus it is alleged that the demand will occasion the supply. I do not deny this in the least degree. There is nothing more certain, in every branch of political economy, than that there will be a supply for the demand. But regard for one instant only what this demand is, and the fallacy of the reasoning will appear at once. It is a market demand which is to produce this supply. It is an increase only of the same demand, which | has already banished coin from circulation; now it is purchased for exportation, then it will be purchased for Government, and the effect will be precisely the same in both cases to give a marketable value to specie as merchandise, in lieu of the exchangeable value which it would otherwise have as money. None will pretend that, because Government will pay it out again, it will thereby circulate, unless they can find the term circulation fully satisfied in a constant round from the custom-house to the broker, and from the broker to the custom house.

If it be true, then, that Government cannot command the precious metals through its revenue, until they return back to circulation, the inquiry remains to be answered, how that end is to be attained? I would answer, first, it will be attained even before a very long time, if matters are allowed to remain, as far as Government is concerned, precisely where they now are.

Let us keep our hands off, and the banks will resume as speedily as reviving trade will allow : within that period I will not profess to answer; but their course of dealing since the suspension evinces the strongest purpose to do so, at the earliest practicable day. The Secretary of the Treasury tells us, in his report, that since the suspension of specie payment, "the policy pursued by most of them, has been favorable to an early discharge of their engage.

The resolution of 1816, now in full force, had the effect at that day of bringing about a general resumption of specie payment by the banks. It will do so again, if its operation be unaffected. I have shown you already the promise under it. But the bill proposes to repeal that resolution, as the first step in the policy of the new law. Then, the attitude of Government towards these institutions was one of encouragement and confidence. It of fered inducements to them to resume, and invited back the confidence of the community. The wisdom of that policy was manifested by the result. Now, the very reverse is to be attempted; in lieu of confidence, we present discredit; for encouragement, menaced destruction. I need not add, that the same end cannot be obtained by such opposite means.

But again, sir, there is in this bill an entire departure from the great and leading principles of the administration, on the subject of the currency. It looks no farther than to a supply of specie for the Government and its dependants. There is no account taken of the more important object of infusing specie into circulation for the common use of the people. Then, the great effort was to enlarge the specie basis, by the suppression of small notes. The Government, as the greatest creditor of the banks, sought to effect this by the control incident to its large deposite. The banks were encouraged in every way to co-operate; and the States were appealed to for their aid in the common duty of a reform in the currency.

Many of them, where there was a bank issue under five dollars, met the appeal at once, by a direct prohibition to that extent.

But the State of Virginia went farther. She had long since realized the benefits of a specie circulation below five dollars, by a prohibition of all paper under that amount; and, on the very first occasion when the charters of her banks would be reached, so recently as during the last winter, the prohibition was extended to ten dollars, and to take effect at an early day.

These were the measures then contemplated for the improvement of the currency, and begun to be carried out by the powerful aid of State legislation. Why are they to be abandoned now! It was admitted then, and it is beyond all question true, that specie, either in gold or silver, will not circulate by the side of paper. If experience of this were wanting, it is abundant in Virginia, in reference to small notes; as soon as they were expelled by her law, silver took their place. And there is no doubt that if her policy could be carried out, by the expulsion of all paper under twenty dollars, gold would flow at once into the vacant channels. All this can yet be done, by a simple adherence to the original plan. But your policy is in utter disregard of all such intent.

The great forcing process now in contemplation, will work the very reverse of what was then so strenuously urged. It will put all our golden dreams to flight, of the

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halcyon days of hard money, and the States will be compelled, from sheer necessity, to license once more the very lowest issue of bank paper. Seeing these things, as I clearly do in prospect, under the operation of the proposed law, I can have no choice but to raise my voice against it.

As to so much of the bill as constitutes the collectors of the revenue, with the mint and its branches, depositories It is cerof the public money, I have but little to say. tainly subject to very strong objections, not the least of which is, the very great increase of patronage to which it must give rise; and a patronage of the most dangerous influence, as being so immediately connected with the public money. Neither is this objection at all answered, when it is said that the patronage will be less than that exercised in the intercourse between the Government and the deposite banks; because, by the simple substitute of a special for a general deposite, all patronage will be at once taken away; and on the score of safety, the difference is incalculable.

Whether I regard, then, the pernicious influence which this bill must exercise upon the currency, if now enacted into law, or the inadequacy of its provisions for the safeKeeping of the money, I am equally constrained to withhold 11y assent. In the first aspect, it has never been submitted the country, and has had very little consideration here. The innovation is too great, the transition too violent, from all previous usage, to be thus suddenly met.


[Oct. 11, 1837.

mitted, then, to such opinions, and having uniformly acted
up to them in every time of trial; in the removal of the
deposites, through the panic era, and the Executive veto,
am not to be frightened from what I have taken as the
path of duty, by the new-born fears even of so distinguish-
ed a proselyte.

I distrust the quarter, sir, whence the denunciation comes.
I have no confidence in that counsel which springs from
the zeal of recent conversion--opinions that are hastily taken
up, are as speedily laid aside, and are worthy of no reliance

No, sir, in my humble judgment the danger of recurrence to a national bank is to be looked for in the very opposite quarter in the immature conception and hurried execu

tion of this sub-Treasury scheme. I do not mean to pre

dict it, because I would not be understood as disparaging
the judgment of those who confide more readily than I do.
But suppose they should fail; suppose it should be found
impracticable to carry out the new scheme; that the curren-
cy should grow worse; that bank paper should continue
irredeemable; and the people become wearied out with your
rigid exaction of coin from them, while nothing but paper
is paid to them: I ask you, and I put it to the serious
consideration of the country, what remedy would then be
found? You could not fall back upon the State banks.
They had just been divorced, and common decency would
forbid the new espousal. Where, then, would you find
refuge? Why, sir, as was done once before, in the arms of

a national bank, and nowhere else.

I am not at all answered in the objections thus advanced, without foundation. You relied as confidently when the public money was transferred to the State banks, that they would not fail. Every official report and every State

The people are too deeply interested in the consequences which may follow, to have this usage changed, without the most matured consideration. For myself, sir, I want to go home from this whole subject, reinfecta. It is a new proposition, presented for the first time, in an imposing when I am told that my apprehensions of this failure are form by the late message, and, before adopted, should be well and thoroughly canvassed before the country. The President and the subject is well worthy of, the fullest deliberation. Let it be discussed, then, as it will be, and as all great public measures ought to be, by the people themselves in operations of the Government, and furnished its best and their primary assemblies, and through the press, before it safest reliance. And yet, within two short years, the whole

is enacted into law.

No inconvenience can possibly arise from this postponement; first, because the time must necessarily be short, as Congress will be again in session, within six weeks from

paper was replete with their commendation.
We were
told that they were equal to every emergency, in the fiscal

system is denounced as an entire failure. What better as-
surance can you give us now than you offered then?
Why may not your new scheme fail? I believe that it
must, inevitably must, if attempted now.

And when it

tem proposed is now, under the late orders of the Treasury, which our new convert so carnestly deprecates. I pray
tein full and complete operation, as if specially ordained you to excuse me, then, if I do not see with his eyes.
in attempting these sub-Treasuries now, the
by the law under consideration. The Secretary has already
cretion given to him by the law organizing the Treasury
Department. There is no occasion, then, for this great nothing but danger in the attempt-opinions differ amongst

haste, and there is every reason why we should forbear.

We are told, however, by an honorable member from South Carolina, [Mr. PICKENS,] that, by our opposition to the present bill, we are strengthening the interest of that party which seeks the re-establishment of any til banke This suggestion, sir, come from a very remarkable quarter. I do not allude now to the member from Carolina, que to a distinguished statesman from the same State, in the outer wing of the Capitol. The sub-treasuries, it is said, must be ordained at once, as the only safeguard against the restoration of a great national banking institution; and this ratiocination seems to be thrown out as a sort of bugbear, to frighten us into instant submission.

Sir, in my humble sphere at home, or in the halls of our State Legislature, my opinions on the subject of a federal bank need no new confession.

I have ever been an un

compromising foe to any such institution. I believe the existence of such a bank is inconsistent with the purity, and dangerous to the safety of popular government. I have and, what is above all, to fix and confirm that opposition, I ever opposed it, in every form, on grounds of expediency; entertain no doubt whatever that it has no sanction, either in the spirit or the letter of the constitution. Strongly com

ernment, if I may so express it, is retreating to the citadel

at once, in the great battle with a bank. I see

your best and ablest advisers, whether you can now make
the position good; and if you do not, there is no escape,

no choice, but in unconditional surrender.

One word more, sir, to the honorable member from South
is directed. I understand him as an appeal to the

Carolina, and to those to whom this portion of his address
democrats of the North, to rally around this sub-Treasury
scheme, as their surest and safest protection against the
oppressier of Northern capitalists.
they are.looked upon as the natural allies of the South,
because their labor holds the same position to capital in
their country that our slaves hold to their owners at the

He tells them that

How these Northern democrats may relish the doctrines of their new ally, I need venture no prediction. I doubt whether they can be brought to rally around the standard of a leader, who denies them any place, even in the common scale of humanity.

Is it upon principles such as these, that the Northern democracy is invoked to lend their aid to the measures con

templated by this bill? These are they, I presume, who

are appealed to in the occasional addresses of certain news-
papers, as the "democracy of numbers," contradistin-

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guished, we find now, from any democracy of men-who hold no place in the thinking, acting part of the community, but are classed as mere dead weight, to be thrown at will into either scale of the political balance.

If there be any such party in our favored land, I thank Heaven that it is unknown in the quarter of the country from whence I come. We have there, sir, I am proud to say, as honest and sturdy a race of democrats as ever the sun shone upon. Of intelligent, thinking, independent, ⚫ and free men; each doing and acting for himself in all questions of public interest; having perfect equality of right, and participating, to the fullest extent of a free citizen, in the direction and control of all public affairs.

[H. of R.

I say, then, emphatically, that the present embarrassed condition of the Treasury is not owing to its connexion with the banks. You have not now money enough to the credit of the Government, in all the banks north of the Potomac put together, (the quarter where the principal revenue is collected,) to. carry on the Government for two weeks. The Treasury is without money; not because the banks have stopped payment, but because its supplies are cut off. Its revenue is stagnant in the hands of its debtors, and not in the vaults of the banks. There is money enough due to you, but you cannot get it in, and so it is precisely with the banks. You and they are both obliged, being operated upon by the same causes, to give time to your debtors, and to wait for the reaction of trade, the re

This, sir, is the character of the democracy with which I am familiar; nor I apprehend are our true Northern de-vival of commerce, before you can again get afloat. mocrats of a texture any whit inferior. But I desire my constituents at least to know to what sort of democracy the merits of this bill are addressed by its friends. Not to intelligent and thinking men, but to a class who are counted only by their numbers, and are estimated to have no influence in public affairs, save as a mass holding a certain position toward capital.

[Mr. PICKENS here asked the floor, and was understood to say, that he did not lay down the proposition as broadly as was stated by Mr. MASON. He meant only to say, that the tendency of the institutions at the North was to organize capital, and to make labor tributary to it; and, unless such tendency were checked, would finally reduce labor there to a state of vassalage.]

Having thus given my objections to the passage of any law at this time, which has not for one of its principal objects a reformation of the currency, or, I should more properly say, which will not by its operation lead back the banks to a resumption of payment, I proceed briefly to suggest what my opinions are of the ultimate attitude which the Government should assume towards these institutions. I have no expectation or belief, notwithstanding the cry which has been raised against the banks, through the press and otherwise, that by any action of this Government these institutions can be destroyed. It is not in your power to do so, sir, if you would; and, if attempted by any means, direct or indirect, every effort that you could make would eventuate in defeat. They are created by the States are incorporated, and have life given to them by their separate law-for their being they lean upon the States, and are as entirely independent of you, as you can ever become of them. Most of the States have a large moneyed interest in their stock, and participate largely in their management by the immediate appointment of di


Virginia has an immense fund invested in her banks, the income from which is appropriated to education, to internal improvement, and to other favorite objects of her State policy. Besides all which, the banks of each State furnish to each the entire paper circulation within its borders-a source of profit in which the States themselves largely participate. For good or for ill, then, these banks are so closely interwoven now, in all their relations with State interests, that they cannot be eradicated, even by the power upon which they depend for existence.

They enter largely into, and influence to a great extent, all the elements which affect the trade of the country; and thus, whether you are connected with, or divorced from them, whenever trade or the course of exchange (in which they largely deal) is deranged or injured, your finances will be immediately affected. You may be divorced from them a mensa, and a vinculis, and should a period ever occur again, when there is a general suspension of specie payment, your Treasury will stop payment in unison with the banks, precisely as it has done now; and the only difference between you will be, that they will stop payment as a measure of precaution, and you from necessity.

Neither is this reasoning at all weakened by the fact that you have some five or six millions yet on deposite in the Southern and Western States, which is styled "unavailable"-meaning that you cannot command it for use. You cannot command it, simply because you have no use for it in the place where it is. In the Northern and Eastern States, where you had use for the money, you have withdrawn it rapidly since the suspension, and so you would have done from those South and West, could you have used the money at the place where it was. Suppose, then, that this money, instead of being on deposite in the banks, was locked up in sub-treasuries in gold and silver. Five or six millions of bullion is too large a sum to be suddenly transferred from one quarter of the country to the other without producing very serious effects upon the trade and business of those places whence it is taken; and yet you would have no other resource whatever in order to make it "available," but to bring it away in bulk, transporting it at heavy cost across the country from the place where it was collected to the place where it was wanted.

You could not command a dollar by means of exchange; for the very causes that now make your deposite "unavailable" there, have run up exchange to rather more than the expenses of transportation. And thus that whole fund, even if now in gold and silver, and in sub-treasuries to boot, would be just as unavailable to Government, in the present condition of the country, as their deposite is in the banks mentioned. Government would not attempt to bring away the metal. The country would not allow itself to be thus drained; or, if it were done, the very operation would open the people's eyes to the working of the machinery, and all would cry out against it. No, sir; if this whole "unavailable fund" in the South and West were now locked up there in gold and silver, sooner than encounter the cost and risk of transportation, and the clamor that would be raised against it in those States, we should go quietly to work, as we are now doing, and issue Treasury notes to answer in its place, until the restoration of trade to its accustomed channels would allow its being made available by the use of bills of exchange.

Treating the banks, then, as they certainly are, institutions dependent for their being upon the States alone, and yet exercising so important an influence upon the trade and business of the country, it becomes us next to inquire what is the best and safest relation in which the Government can place itself toward them, to avoid, as far as may be, a recurrence of the evils under which we now labor.

In the first place, I see no prior necessity, either as regards the welfare of the Governinent or the banks, for any connexion between them whatsoever. A sudden and violent separation, such as is contemplated by this bill, I have already said would, in my judgment, be impracticable in the present condition of the country. I believe the transition (from the state of things which such a "divorce" would create) would be a national bank, as inevitably as

H. OF R.]

Sub-Treasury Bill.

from anarchy and confusion a people always seek relief in despotism.

The process of separation must be gradual after it is commenced. And its commencement must await the entire recovery of trade, accompanied, as such recovery will be, by a sound and healthful currency; that is to say, a currency, so far as it is paper, convertible into specie at


The Government may, I think, under such circumstances, and at such time, confine its receipts to gold and silver, and withhold its revenue, while resting between collection and disbursement, from all use, whether of banks or others.

I am aware that strong objections hold to keeping so much money idle as would remain permanently on hand under any system that may be adopted. But my decided impression is, nevertheless, that the patronage and political influences with which its use by these corporations must be attended, together with the great incentive which it offers to overtrading, are objections far stronger. And from such inaction of the public money I should look for another great practical good. It would invite, in the most urgent manner, as a fixed policy, a scale of revenue reduced to the lowest standard of the most economical administration.

And again by confining its receipts to gold and silver, the collection of the revenue would exercise a salutary control over the issue of the State banks. It would do so, by presenting at their doors, to the extent of that demand, always an inexorable creditor—a curb sadly wanted by the banks in their late career. The receipt by Government of gold and silver only, after the paper medium becomes freely and immediately convertible into coin, presents nothing inconsistent with the position that Government must deal in the same currency in which the people deal, because coin and paper immediately convertible are substantially

the same.

[Ост. 11. 1837.

the committee, I avail myself of the occasion to ask a share
of its attention. Before attempting to express my views,
permit me, sir, to advert to an amendment which I had
the honor, some two weeks past, to lay upon the table,
and which, with some modifications, it is still my wish,
at a proper time, to present.

[Mr. ROBERTSON here requested that the Clerk might
read a part of his proposed amendment.]

My proposition, sir, substantially is, that the public treasure shall be placed as a special deposite in the local banks.

The bill before us, Mr. Chairman, presents for our consideration two questions, essentially distinct, which, however, seem frequently confounded: one, as to the medium in which the public dues should be paid; the other as to the manner in which they should be kept. The one is a question of currency: the other of custody merely.

Agreeing, sir, with my colleague, [Mr. JAMES M. MAsox,] that no Government ought to exact from the people a currency which they cannot command without a heavy sacrifice, I am prepared to go farther than he is. After so strongly protesting against such a policy, he must pardon me for saying that in insisting, as he does, on specie, or the notes of specie paying banks, he runs counter to his own doctrine. There is but little difference between his scheme, indeed, and that of the bill before us, which he denounces as oppressive. The only difference is, that he would permit the whole revenue to be paid in notes of specie paying banks, whereas this bill permits three-fourths only for the ensuing year, gradually diminishing the proportion, until, at the end of four years, specie only shall be received. But at this time, and until the banks shall oper. their vaults, both propositions are equally oppressive; for until that shall happen, and no man can foretell the day, there can be no notes of specie paying banks, and gold and silver therefore is exacted by both. To afford any effectual relief, we must receive such currency as the people can procure; we should take from them until the resumption of specie payments by the banks, such notes as they take from each other; such as the State governments receive in payment of public dues-provided they be not too greatly depreciated. If gentlemen can insure a speedy resumption, it may be well to insist on gold and end-silver, or the notes of banks which pay it out; but to exact either at this time, is to be guilty of the very oppres sion my colleague so justly denounces. The only remedy for the evil which those who have the power propose to apply, is to be found in the plan they have adopted of issuing Treasury notes. The manufactory of paper money just established in Washington, is to afford us a currency adequate to all our wants. My colleague, who supported the measure, disavows any design of creating this currency with a view to circulation. I am glad that he does. But the object has been explicitly avowed by many of its friends on this floor. We have been told by the President that eight or ten millions will suffice for public payments; and, with the view of meeting those payments, we authorize the issue of ten millions in Treasury notes. It only requires authority to continue them in circulation, by a reissue, to supply the whole annual revenue. Should this system become established, all the channels that lead to the Treasury will be supplied with our new paper money, and not a dollar of specie, in all probability, find its way to it, except what may flow from the mint. This is the plan of our hard-money Government; and, to reconcile us to it, the gentleman from Maryland, [Mr. McKIM,] by a strong figure of speech, calls this paper gold and silver.

But I can see no advantage, and on the contrary a fruitful source of mischief, in making Government officers the keepers of the cash. Place about them what guards you may, in the shape of commissioners, inspectors, or whatever else, peculation will be endless. There is no security in it, and it will involve heavy and unnecessary expense. The chief and over-ruling objection, however, is the less source of patronage to which it would give rise. Make the machinery as simple as you may, and open to view, wherever money is, temptation will creep in, and corruption in every form following at its heels. But the money can be safely kept, under the most ample security, and freed from every objection of patronage or political influence, by a simple system of special deposites in the State banks, remaining always in specie, the separate property of the Government, and paid out in kind upon drafts from the Treasury.

I have thus stated my objections candidly and fairly to the bill. They go more to its peculiar machinery, and to the time at which it is brought forward, than to its general scope as a measure of State policy in the subject which it is intended to affect. There is no sufficient reason, as I have already declared, satisfactory to my mind at least, why it should be passed now at the close of a short and hurried session. And I take leave of it, therefore, in the confident hope that this great subject of the relations between bank and State will, at a future day, be presented in such form as will unite those counsels which are now so unhappily divided.

When Mr. MASON had concluded

Mr. ROBERTSON, of Virginia, addressed the chair as follows:

Mr. Chairman: As the gentleman from South Carolina [Mr. LEGARE] has declined for the present occupying the floor, and no other gentleman seems disposed to address

I do not profess to measure the consequences of this new issue of paper money. I believe it to be calculated, if not intended, to throw discredit upon the State banks, and am unwilling myself to engage in a war upon them. All the States have adopted the policy of banking.


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