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John Taylor, in his Inquiry into the Principles and Pol- similar institutions, with the same power of circulating their icy of the Government of the United States, page 291, paper, and controlling and depreciating the currency, as the compares the banking system to the feudal system of Great Slate banks or the late Bank of the United States. Britain, and says: “Had banking been called a paper Mr. Raymond, in his first volume of Political Economy, feudal system,' and had the barons proposed to take it by page 252, proposes that “Government manufacture a paper that denomination as a reimbursement for their abolished currency in the form of our present bank notes, payable in tenures, it might have been fairly weighed against the land- specie on demand at the Treasury, or at such other places ed feudal system, to estimate the effects of the exchange. as the convenience of the Government and the public may Mirabeau once forcibly remarked, “ All paper money is a justify.” In his second volume of the same work, he says: phrensy of despotism run mad.”.
“ Let it (the Government) take into its own hands the enYour committee come now to the third inquiry proposed, graving and manufacturing of bank notes, all except the which was,
signatures, and establish a mint, and appoint officers, under What remedy can be provided against the evils arising proper responsibilities, for that purpose.” He is not explifrom our banking system?
cit in his proposition as to the power of the Government to It is generally much easier to point out evils than it is take into its hands either the issuing the notes or manu. to provide remedies ; and so it is, perhaps, in the subject facturing the paper under its control, to be issued by such under consideration. It would not be difficult to point to officers as he speaks of. It may well be doubted if the a remedy if all would agree to it, so as to carry it into ef- National Government possesses any such power under the fect; but on a subject so complicated, and of so deep im- present provisions of the constitution. If it does not, it portance, it could hardly be expected that there would not could not obtain it in any way but by an amendment in be some conflict of opinion.
the mode provided in the constitution itself; and it may It would be premature, in the opinion of your committee, well be questioned if it would be sound policy to provide to undertake at present the passage of any specific pro an amendment conferring such power on the National vision until the subject shall be discussed and fully delib- Government. Some have proposed such an amendment erated upon by the people. It would be particularly un- of the national constitution, providing that the banking advised to propose and discuss any constitutional provision incorporations in the States shall be graded, so that those of so much importance at a short session of Congress, of large capital may be limited to notes above one hundred
Your committee have, therefore, thought proper to con or five hundred dollars, and those of smaller capital to the tent themselves with presenting some of the various sug- issue of notes of still smaller denomination, but that none gestions which have been occasionally made by men whose should issue notes of less denomination than twenty dollars. opinions are entitled to consideration, and submitting a If such a constitutional amendment were agreed to by the proposition, not with a view of any legislative action at the States, your committee entertain no doubt whatever that present time, but that it may go before the people, to delib- that it would tend much to purify the currency, if it could erate upon it, discuss its merits, and suggest such modifi- be enforced ; but it would be extremely difficult to provide cations as they may think best. They do not pretend to against its evasion, and the corrective of its violation must decide that the proposition they submit is perfect, or that necessarily be left with the State Legislatures. Others, it is the best that could be proposed; but in order that some again, have suggested the propriety of amending the conthing tangible may be thrown out, they have chosen to pre- stitution in such manner as that no State incorporate sent the broadest proposition of which the subject is sus- banking institutions with power to issue notes beyond the ceptible.
amount of specie capital in their vaults. If such a provisMr. Jefferson seemed to entertain the opinion that an ion could be carried into effect, it is believed the work of easier way of effecting a remedy should be sought than the reform in the banking system would be accomplished. But formality required in the constitution for its amendment. little mischief, and much good, might flow from a system He did not raise any other objection to a constitutional carried out on that principle. The great evils arising amendment than the difficulty of succeeding in obtaining from the present systems spring from the power which the it. In the 1th vol. of Mem., page 220, in a letter to Mr. banks either possess or usurp, of extending their issues far Eppes, already quoted, after commenting upon the evils beyond the amount of specie they have, and thus depreciaarising out of our banking system, he says: “But no rem- ting the whole circulating medium. The difficulty, howedy is ever to be expected while it rests with the State Le-ever, would be to prevent evasion of such a provision. gislatures. Personal motives can be excited through so We have seen in the case of the Sutton Bank, placed unmany avenues to their will, that in their hands it will go der the immediate control of the law of its creation and exon from bad to worse, until the catastrophe overwhelms us. istence, a glaring evasion of its clear and undoubted proI still believe, however, that, on proper representations of visions, by the commission of a base fraud and falsehood. the subject, a great proportion of these Legislatures would The more remote restraint of the federal constitution would cede to Congress their power of establishing banks, saving be much more liable to evasion in the same way, and the charter rights already granted. And this should be much more difficult to be applied as a corrective, than an asked, not by way of amendment to the constitution, be- act of the State Legislature. cause until three fourths should consent nothing could be Gabriel Slaughter, Governor of Kentucky, in bis mesdone ; but accepted from them, one by one, singly, as their sage to the Legislature of that State, in 1818, holds the consent might be obtained." The principle he advances following language: “I am indeed ready to confess, beis predicated on the ground that the incorporation of bank- fore my countrymen, that my sentiments, or perhaps preing companies for the circulation of notes is pernicious, but judices, ever have been, and still are, strongly against the doubts whether three fourths of the States would surrender ; banking system. I have ever viewed these moneyed corand therefore, and for that reason only, suggests that the porations with jealousy. I consider the corporate powers proposition should be made to the States singly, to cede and privileges conferred on them as so much taken from their power of authorizing companies to issue notes of cir- the power of the people, and a contrivance to rear up in culation. It is not to be presumed that Mr. Jefferson, who the country a moneyed aristocracy. Money is power, in was always well known to be opposed to a United States whatever hands it is placed ; but it is less dangerous when Bank, intended to convey the idea, by the State Legisla- divided among individuals, than when combined and orture ceding to Congress their power of establishing banks, ganized in the form of banks. In vain did the American which he speaks of, that it should be done in such a man- people, during their struggles for liberty and independence, ner and to such extent as to enable Congress to establish | destroy the landed aristocracy then existing under the law
authorizing estates to be entailed, if a moneyed aristocracy proposition of an amendment to the constitution, that do is to be substituted. Instead of having our National and State shall authorize any company or individuals to issue State Legislatures filled with men representing the feelings notes for circulation as bank notes. They do this, not and interests of the great agricultural class of the commu with a view to the immediate action of Congress, which nity, I fear we shall see these banking aristocracies greatly thcy deem at present as inexpedient and premature ; but preponderate on the legislative floor. I must ever be op- that some proposition may be thrown out in a tangible posed to any system of policy which, independent of its shape before the people, for their discussion and delibepernicious and corrupting influence in other respects, ration, should they feel that the subject is of sufficient importends to diminish, if not to destroy, the weight and influ- tance to enlist their attention. ence of the farming interest, upon whose virtue and inde Is there any thing unreasonable in the proposition? It pendence the duration of our free institutions so essentially is calculated to meet precisely the evils now, which were depends.
met by the provisions of the constitution then, as it was “While this system exists in other States, Kentucky then adopted and now stands. Are the States less patrican do little to rescue the country from the evil and anti-otic, less disposed to yield to each other for the good of republican tendencies of these moneyed corporations. Let the whole, than they were fifty years ago ? Would not us, therefore, invite a co-operation in some plan, coexten- such a mutual concession of all promote the advantage and sive with the Union, to redeem this young and rising re interest of each ? If money would be scarcer, it would be public from the mischief and dangers of this paper system, proportionately better, and uniformly and permanently the before it is too late. If permitted to progress and inter
We have now in the United States $140,301,038 weave itself with all the interests and concerns of society, of paper money in circulation, and about $30,000,000 of it may, in a more advanced and dense state of our popula- specie, or five and a half paper dollars for one of specie, in tion, explode in a convulsion of the Government. The circulation; and about $40,000,000 specie in the banks, disease, it is true, has taken deep root; but the American making about one specie dollar, in all, for three of paper. On republic is young, and, by a vigorous and determined ef- the adoption of such an amendment as suggested, the banks fort, may, in a few years, exterminate it. Some time may would gradually cease as their charters expired, and the be necessary to enable these institutions to wind up. To transition from a paper manufactured currency, subject to effect so desirable an object, I would recommend to the constant fluctuations and panics, to a steady and uniform Legislature to propose an amendment to the federal con- standard of value, would be so slow and gradual, that it stilution, providing that, after a certain period, no incor- would not be felt to the same extent as has often been done porated bank should exist in the United States; or if this by a sudden contraction of bank issues, after an excessive should be thought going too far, and banks in any shape, stimulus given by an expansion. or to any extent, are useful and necessary, let the banking Your committee cannot close this report without dispowers be limited, and the system so regulated and restrict- charging a further duty to the memorialists. They have ed, as to secure the community against the wide-spread been assailed, both in Congress and out of it, as aiming to ruin and mischief with which we are threatened.” Reso place the States under the control of the National Governlutions were offered in the Legislature of that State on the ment, as though it were a great advantage to the States to 4th of January, 1819, in accordance with the sentiments have their citizens taxed for the support of bankers and of Governor Slaughter, but never carried out any further. speculators. They have been charged as a description of
It is obvious that the evils arising from a vicious bank- disorganizers, seeking to overturn the State Governments, ing system, grown up under the legislation of States con. and concentrating all power in the Federal Government. federated as the United States are, cannot be remedied but This charge has been made, too, by advocates of the docthrough an amendment of the constitution itself. No one trine that Congress have a right to establish a national single State can act efficiently, without the co-operation bank. Your committee see no foundation for the bitterness of others. However fallacious the argument may be, the that has been manifested towards them. They have, as excessive issues of bank paper in one State are used to in- they had an undoubted right, sent their memorials, sugduce others to either engage or continue in the same error. gesting to Congress the consideration of a grave and imOne will not seek to correct it, lest another may not; and portant question of general concern, couched in approprithus, what perhaps all would cordially and cheerfully ate and respectful language, and under circumstances agree to, acting together, no one will coinmence alone. which exclude all possible idea of selfish or sinister moWhile the þanks of one State issue notes to the amount of tives. They are respectable and intelligent citizens of the $3 or $4 for one of specie, those of others issue $8 or $9. United States, and suggest the consideration of their views While some banks in the same State issue $2 or $3 in pa- precisely in the way pointed out by the constitution under per for one of specie, others issue $5, $6, of $8 for one; which we all live. If a citizen of this Union conso that we have not only, in the language of Mr. Madison, ceives he has a claim upon the Government, and prefers his quoted, “as many currencies as States,” but nearly as petition, it is respectfully received and considered, whether many currencies as banks. Let not this be used as an ar his claim is founded in error or not, although he has a gument for a national bank. Such an institution, based direct and personal interest. How much more is the me on the principle of manufacturing paper money, is calcula- morial of citizens, on a subject of general interest, entitled ted rather to augment than remedy the evil.
to respect! The suggestion they make is not new. It Your commitiee respectfully suggest whether it be not has been made by as wise and as good men as any by whom more appropriate, as well as more practicable, in adopting they have been assailed here and elsewhere. an amendment to the constitution, to provide against the The spirit of inquiry is the life of republican Govern. kind or nature of institution, rather than the extent or mode ments, and should be rather promoted than discouraged, of operations of any particular kind of institution ; whether, even if the sentiments advanced at the start are mistaken or for example, it would not more comport with the nature of erroneous. Whenever that is attempted to be stifled or a constitutional provision, that no State shall incorporate a hushed to silence by misrepresentation, persecution, or bank of circulation, than that it shall incorporate no bank other weapons than those of reason and argument, it is a authorized to issue notes beyond a certain amount propor sure indication of some lurking tyranny that fears the light, tionate to its capital, or notes below a certain denomina- suspicious or self-conscious of the defective tenure by which tion. They have, therefore, thought proper, on full and it rules. deliberate consideration of the whole subject, as far as they With these remarks, and with the purpose before indicahave been able to investigate it, to submit the broadest ted, your committee submit the following joint resolution :
Resolved by the Senate and House of Representatives of not produce, having reference to the necessity of explanathe United States of America in Congress assembled, tion as affecting himself. The reservation is in these That the following amendment to the constitution of the words: “ To the adoption of the foregoing resolution United States be submitted to the Legislatures of the several Mr. Martin objected, upon the ground that he doubted the States, for their ratification, agreeably to the provisions of power of the committee, upon the showing then before the fifth article of the constitution :
them, to require the production of all the papers therein “No State shall authorize any incorporated company to required; and moved for a division of the resolution, so as issue any bank note, or other paper, for circulation.” to take the question upon ordering the subpæna for Mr.
R. M. Whitney, and the subpæna duces tecum to him AGENT OF DEPOSITE BANKS.
separately ; which motion was withdrawn, upon the under
standing with the committee, generally, that the question House of REPRESENTATIVES, March 1, 1837.
of power to enforce the command, if objected to by Mr.
Whitney, to whom the subpena duces is directed, is reAsr. Garland, of Virginia, from the select committee to served." The committee has not, in a single instance, which the subject had been referred, made the following attempted to enforce the production of any paper objected report :
to by the witness.. As to the question whether the House The select committee to which was referred the resolu- of Representatives had the power to direct the inquiries tion of the House of Representatives, directing them to contained in the resolution organizing the committee, it is inquire “ whether the several banks employed for the de- not deemed necessary to make any remark. In adopting posite of the public money have all or any of them, by the resolution, it is to be presumed the House well under: joint or several contract, employed an agent to reside at stood its power and its duty, and did not hastily institute the seat of Government, to transact their business at the inquiries beyond the reach of one or the other. The comTreasury Department; what is the character of the busi- mittee does not claim for the House, or itself, the power ness which he is so employed to transact, and what com to compel the deposite banks to expose their private conpensation he receives ; whether such agent, if there be one, cerns or private transactions to the scrutiny of the comhas been employed at the request or through the procure- mittee, nor has the committee, in any instance, demanded ment of the Treasury Department ; whether the business such exposure. Yet, while the committee does not asof the Treasury Department with said banks is conducted sert any such claim of power, it holds it decidedly within through said agent ; and whether, in the transaction of any the power of Congress to ascertain, by other competent business confided to said agent, he receives any compen- and legal testimony, any of the transactions of the deposite sation from the Treasury Department,” has had the same banks which are calculated to affect the safety of the pubunder consideration, and respectfully report :
lic funds, and to render some action, on the part of ConThat, in making the inquiries committed to its charge, gress, necessary for their security. the committee has been compelled to encounter many The second grew out of the propriety and effect of many questions of power and discretion of a most delicate and interrogatories which the committee did not object to, or embarrassing nature ; delicate, as sometimes encroaching permitted to be propounded to various witnesses, affecting, upon the precincts of private reputation and private trans as they might do, purely private transactions and private actions; embarrassing as to the line of privacy and confi- reputation. In this state of difhculty, it was thought best, dence beyond which the committee could not pass without and most comporting with justice to the witnesses themviolating private rights and private confidence. The first selves, to permit the inquiries to be made, and in every of these grew out of the protest of Reuben M. Whitney, case leave the witness to determine for himself whether he a witness summoned before the committee to testify, (see would answer or not, as the committee could not upon all journal, p. 67,) against the requirement of the commiitee occasions determine how far the witness might desire to in the resolution of the 7th of January last, found in the answer for the purpose of explanation, as before remarked. 4th page of the journal, and the powers of the House of The committee does not deem it proper to conclude that, Representatives to make the examination, as directed in because a witness might refuse to answer what would in the resolution organizing the committee, and directing its his estimation be a breach of confidence, the refusal ought inquiries. It is not the purpose of the committee to enter to involve even a suspicion of guilt; if this were the case, into a long or detailed answer to said protest; they have the rule of legal and social propriety, which protects from not time, if hey were disposed, nor is it necessary to do so. scrutiny, by any tribunal, a man's private and confidential As relates to the resolution of the committee, the whole transactions, would be but a snare to deceive ignorant and argument of the protest is based upon the idea that the entrap the unwary. The committee could not upon all committee has asserted a claim of power, in compelling occasions, when questions were proposed seemingly irrelethe production of private papers, and in examining into vant, determine to what relevancy a train of interrogatory private transactions, which it has not done; the resolution based upon it might lead ; and could not, therefore, with is general, and calls for no specific paper; it calls generally propriety, withhold many interrogatories of that character for such papers, &c. as may refer to, and shed light upon, which were propounded. The committee attempted to the inquiries directed by the House. The committee, in shape its course, under these delicate and ernbarrassing adopting this resolution, made it general, because they had circumstances, by a just regard to the public interest and no knowledge of the particular character of the papers held the private rights and reputation of individuals ; if, in doing by the witness, whether they were of a purely private or so, they have erred, they did so from motives any other public character, and could not, therefore, designate any than a disposition to become inquisitors of private character particular paper for which to make a call; and because or private business. they thought it due to the witness himself that he might The resolution of the House directs the committee to have the opportunity of producing such papers of a private make several inquiries, to which they will procced to recharacter as he might deem necessary for the purpose of spond in the order of the resolution. explanation, if such explanation should be deemed neces The first inquiry directed to be made is, “ Whether the sary by him. Immediately following the adoption of the several banks employed for the deposite of the public mon. resolution referred to, the committee made an express res. ey have all, or any of them, by joint or several contract, ervation of the question, what papers they would or employed an agent to reside at the seat of Government, would not compel the production of
, until the witness to transact their business at the Treasury Department.” had determined, for himself, which he would or would The evidence before the committee, of the Hon. Levi
Woodbury, Secretary of the Treasury, and many of the have not, by joint or several contract, employed an agent, officers of several of the deposite banks, proves that several to reside at the seat of Government, to transact their busiof the deposite banks have, by separate contract, appointed ness at the Treasury Department. an agent to reside, and who does reside, at the seat of Gov In coming to this conclusion, the committee are well apernment, charged with the duties of a corresponding agent prized, from the evidence before them, that there are some of the banks by which he is employed; but it does not occasions upon which some of the deposite banks, through appear that he is clothed by these banks with any authority their agent, have presented some suggestions to the Treaswhatever to transact their business with or at the Treasu- ury Department, in relation to the public deposites, and ry Department; on the contrary, it is proved, by the testi- that these suggestions have received a respectful consideramony of Mr. Woodbury, Mr. Whitney, several clerks of tion, and perhaps may have induced some action on the the Treasury Department, and the officers of the various part of the Secretary of the Treasury, in reference to them, deposite hanks, that the agent has no such authority. For such as the business referred to in the following extract the correctness of this conclusion, the committee refers to from the report of the Secretary of the Treasury, to wit: the answer of the Secretary of the Treasury of the 11th "8. The names of the banks employing said agent are, January last, to their resolution of the 7th of the same with the few exceptions before alluded to, unknown to me month, on the 4th page of the journal, and his parole ex except by rumor. amination; to the testimony of McClintock Young, page “ Besides the Planters' Bank at Natchez, and the Com96, 3d paragraph of his answer to the 1st interrogatory; of mercial Bank at Cincinnati, copies of whose correspondence James Howard, president, and James L. Hawkins, cashier, have already been furnished, I think that in one or two of the Franklin Bank of Baltimore, page 130, in which cases of difference of opinion as to claims made by the they say: “ The entire business of the bank with that banks through their agent, and in those alone, a written Department has uniformly been transacted by its presi- communication was shown to me by him, concerning the dent or cashier, directly with the Secretary at the head of authority confided by them.” (p. 13 of journal.] the Department, the Treasurer of the United States, or And the evidence of the Secretary of the Treasury, conme of the legally constituted officers of that Department." tained in his answer to the 44th question : The testimony of Hugh W. Evans, president, and Robert · Question 44. In the cases alluded to in your report of Mickle, cashier, of the Union Bank of Maryland ; in their the 11th instant, where the Planters' Bank, Natchez, and ist and 36th answers, page 132 and 133, they say: “The the Commercial Bank, Cincinnati, confided authority upon Union Bank of Maryland has never employed any agents said Whitney, as shown to you in a written communicato transact business with the Treasury Department, having tion, what was that authority; what were the claims or always corresponded directly with it, touching its employ- requests made by him; what was the case of the Commerment as a deposite bank.” The testimony of James Schott, cial Bank at New Orleans ? president of the Girard Bank, of Philadelphia; on journal, “ Answer. The cases referred to in my report of the page 150, he says: “He is vested with no authority what- 11th instant, where differences of opinion occurred, and an ever to act on any subject, or on any occasion, on behalf authority was produced, but not found necessary to be of the bank, in relation to its business.” The testimony filed, were those of the Commercial Bank at Cincinnati and of William D. Lewis, cashier of said bank; on journal, the Commercial Bank at New Orleans. I mentioned the page 152, he says: “So far as the Girard Bank is con- Planters' Bank only as one to which a general notice had cerned, it has no agent at the seat of Government, with the been given, and was on file, as to his agency, and a copy powers alluded to. The whole of the business of the bank of which was annexed. The particular case of the Comwith the Treasury Department, since it has been a deposi- mercial Bank at Cincinnati was, so far as I recollect, a lettory of the public money, has been transacted directly by ter which he held in his hand and read, wishing him to the president of the bank and myself.” Again, page 154, request the Department to change the place to which some 8th answer, he says: "The business of the Treasury De- of the transfers outstanding against it were to be made, partment with the Girard Bank is not conducted through such as from other parts of Ohio or Kentucky to New Orthe agent at Washington.” The testimony of George leans or Philadelphia, and stating the reasons for the request Newbold, president of the Bank of America ; on journal, to be, that the banks in Ohio and Kentucky would probapage 160, he says: “To the 1st, 2d, 3d, 4th, and 5th bly demand specie, or be less accommodating as to payments requisitions, he says that the Bank of America has not, at than those at a distance. I think it stated, further, that an any time, employed an agent at the seat of Government to extension of some of the transfers was desirable, if the Detransact its business with the Treasury Department; it has partment could conveniently grant it; and complained that been uniformly and wholly transacted by the bank, directly the time already allowed was too short. The agent, also, with the Secretary of the Treasury, and other proper and urged both these requests, assigning similar reasons; and official officers of the Treasury Department." The testi- that the time granted, in several cases, was less than that mony of Thomas W. Olcott, president of the Albany formerly allowed, under like circumstances, to the United Farmers and Mechanics' Bank; journal, page 242, he States Bank to make transfers. I declined to change the says:
“ All business transactions between that Department places from Ohio and Kentucky, as requested, because, and this bank are direct; and there is no intermediate organ under the late deposite law, I felt bound to confine to the or agent of communication, other than the duly acknowl- neighborhood those particular transfers till about money edged and properly constituted officers of that Department.” enough was placed in Ohio and Kentucky to mcet their Again, on page 243, No 12: “Our corresponding agent share of the anticipated division of the surplus and the may alvise us, and suggest matters for our consideration, current expenditures, rather than send it to a distance; but but he has no authority for our instructions ;” and to the the time for some of the transfers, which seemed too short, concurring testimony of William Neil and J. Delafield, I proposed to extend as long as seemed to be proper. He, president and cashier of the Clinton Bank of Columbus. however, declined taking such extension in behalf of the The force of this positive testimony from the Secretary of bank, unless I could make it longer, thinking it would not the Treasury, and many of the deposite banks who have be useful so little extended; and, therefore, I wrote to the employed a resident agent at the seat of Government, is bank itself what had been proposed to him, and his declinot broken by the adverse testimony of a single deposite ning it; and that I should, notwithstanding, give the er. bank, or a single witness speaking from his knowledge. tension which to me seemed suitable; and the bank, if not The committee, therefore, feel themselves fully warranted accepting it, might pay the money over at the time origiin the conclusion that the deposite banks, or any of them, Inally fixed. In respect to the Commercial Bank at New
Orleans, the application by the agent was, according to various officers of the deposite banks employing said agent, my recollection, with a letter, setting out that the Depart- who have testified upon this occasion, and who describe ment had, by transfers and warrants, drawn out, or propo- the character of the agency referred to. The Secretary of sed to draw out, all, or nearly all, the public money in its the Treasury, in his response to the resolation of the compossession, and wishing him to request it to revoke some mittee, before referred to, says: of the transfers, and possibly to postpone some to a much “I know nothing with accuracy, beyond what has already later day, if none could be revoked. I informed him that been stated, as to the duties he is to discharge for those the bank must be in error, as, before signing a transfer, or banks which employ him. But I presume, as just intisending one, I was always careful to see that it would not mated, it is to communicate the earliest information on all reduce a bank too low. I sent for the clerk who had charge subjects he may suppose to affect their interests, whether of the subject, and examined into it critically; and decli as public depositories or private banking institutions; to ned to revoke any of them, as I felt satisfied that the bank give his advice and aid when called for, or deemed useful and its agent considered the money the bank had been no- in the transaction of their business of either character; to tified it would probably be called on to pay the State of be the organ, at times, of presenting their wishes to the Louisiana during 1837, but for which no transfers had Department, in respect to subjects connected with their then been issued; and which, I told him, would not be public obligations; and to procure here and communiissued when the time of payment arrived, provided the cate the best intelligence in his power on the state of the bank should, before that time, be drawn down too low. I money market at home or abroad; on the condition of the informed him, also, that the bank had, by mistake, inclu- currency and of the exchanges; and on the su pposed ded one transfer, in order to make out its case, which had legislation likely to happen in Congress, either as to the never been issued, according to our records ; and, hence, banks themselves or as to hearý appropriations to be paid I could not revoke any that had been issued. He seemed by them; and, in fine, on any other topic which he may to be satisfied that the bank was right. Whether any ex consider interesting or beneficial to his employers." tension of time were given in this case, I do not remember, In the same report, and in the testimony of the Secrebut know that none were given beyond the period of the tary, the same description of the business of said agency is quarterly payments to the States, for which purpose these substantially given, perhaps in a mere minute and expandtransfers had been seasonably ordered.” [Pages 59 and 60 ed form, to which the House is respectfully referred. of journal.]
The testimony of James Schott, president of the Girard But these occasions, so far as disclosed by the evidence, Bank, states : " That the Girard Bank has had, and still have been rare, and not incompatible with the general con- has, an agent, who resides at Washington, whose duty it clusion to which the committee has arrived.
is to communicate to his principal whatever information he In instituting this agency, the committee cannot perceive may obtain touching the interest of the bank, and having a that the banks have violated any principle, either legal or bearing upon its safe, useful, and profitable management. moral, or violated their compact with the Government con The preamble and resolutions of the Bank of America, on stituting them depositories of the public money. The sev- page 161, are also descriptive of said agency : eral deposite banks, with the exception of the Bank of the “ Whereas the opinion has been entertained and exMetropolis, in this District, received their charters from pressed that the interests of this bank, and the other banks the several State Governments in which they are located, in this city, as well as the interests of the commercial comand are responsible to their several State authorities only; munity, may be promoted by the employment of a suitable they have the undoubted right to institute agencies at their person, resident at Washington, to act as agent for the three own expense, at any place, to transact any lawful business, deposite banks in this city, to obtain and communicate to without restriction on the part of this Government. If they, them, with the full consent and approbation of the Secreor any of them, have instituted an agency incompatible tary of the Treasury, seasonable information from time to with the interests of the Government, or in violation of time, on the following points, as well as other general or their compact, the only remedy in the hands of this Gov- particular information, which may be useful and proper to ernment is, in the first case, to discontinue the offensive communicate, viz: banks as public depositories, and, in the second, to seek “ The amount of revenue receivable at New York for a redress, through the proper judicial tribunals, for any injury period of two or three months to come. sustained. The committee does not perceive that any part
“The amount, or probable amount, of public money to of the compact between the Treasury Department and the be disbursed here, or the amount that the three deposite several deposite banks prohibits the institution of such an banks in New York may be called upon to pay for that agency, and consequently that said agency is not in viola- purpose, and for a like period. tion of it. If the Congress of the United States has the “The amount of public money that they may probably power to restrict the institution of lawful agencies on the be required to transfer, and the time when and the place part of banks deriving their powers from State authorities, or places where the transfers are to be made. they would have the same power to restrict individual Is Therefore, resolved, That the president and cashier agencies, and extend its powers into all the ramifications of of this bank be, and they are hereby, authorized, in cosocial interco urse, however private and confidential, and operation and conjunction with the two other deposite mould them to its own views of propriety or purposes of banks of this city, or with the presidents and cashiers thereporver-a clai m so startling, from its enormity, as to ex- of, to appoint such person as they may deem suitable and clude oven a moment's consideration as to its existence. proper to act as agent for the purposes aforesaid, and to
It will be here proper to remark that Reuben M. Whit- agree to make the said agent suitable compensation for his ney is the agent of most of the deposite banks which services : Provided, That the amount to be paid him by this employ one; but that one or two of them have other bank shall not exceed the sum of six hundred dollars per agents, whose names the committee deems it unnecessary annum." to mention.
In the testimony of James Dode and William T. HookThe second sulject of inquiry directed to the committee er, president and cashier of the Farmers and Mechanics' is, What is the character of the business said agent is em Bank of Connecticut, this agency is thus described : “ To ployed to transact, and what compensation he receives ? the 23d we answer, that R. M. Whitney, Esq. was the
The committee, in responding to this inquiry, cannot do agent of this institution at Washington, as will appear by it more intelligibiy or more accurately than by’employing the documents hereto annexed, and on the terms therein the larguage of the Secretary of the Treasury, and of the specified, from whom we expected, and occasionally re