Banking Companies. John Taylor, in his Inquiry into the Principles and Policy of the Government of the United States, page 291, compares the banking system to the feudal system of Great Britain, and says: "Had banking been called a 'paper feudal system,' and had the barons proposed to take it by that denomination as a reimbursement for their abolished tenures, it might have been fairly weighed against the landed feudal system, to estimate the effects of the exchange.' Mirabeau once forcibly remarked, All paper money is a phrensy of despotism run mad.” Your committee come now to the third inquiry proposed, which was, What remedy can be provided against the evils arising from our banking system? It is generally much easier to point out evils than it is to provide remedies; and so it is, perhaps, in the subject under consideration. It would not be difficult to point to a remedy if all would agree to it, so as to carry it into effect; but on a subject so complicated, and of so deep importance, it could hardly be expected that there would not be some conflict of opinion. It would be premature, in the opinion of your committee, to undertake at present the passage of any specific provision until the subject shall be discussed and fully deliberated upon by the people. It would be particularly unadvised to propose and discuss any constitutional provision of so much importance at a short session of Congress. Your committee have, therefore, thought proper to content themselves with presenting some of the various suggestions which have been occasionally made by men whose opinions are entitled to consideration, and submitting a proposition, not with a view of any legislative action at the present time, but that it may go before the people, to deliberate upon it, discuss its merits, and suggest such modifications as they may think best. They do not pretend to decide that the proposition they submit is perfect, or that it is the best that could be proposed; but in order that something tangible may be thrown out, they have chosen to present the broadest proposition of which the subject is susceptible. it. Mr. Jefferson seemed to entertain the opinion that an easier way of effecting a remedy should be sought than the formality required in the constitution for its amendment. He did not raise any other objection to a constitutional amendment than the difficulty of succeeding in obtaining In the 4th vol. of Mem., page 220, in a letter to Mr. Eppes, already quoted, after commenting upon the evils arising out of our banking system, he says: "But no remedy is ever to be expected while it rests with the State Legislatures. Personal motives can be excited through so Imany avenues to their will, that in their hands it will go on from bad to worse, until the catastrophe overwhelms us. I still believe, however, that, on proper representations of the subject, a great proportion of these Legislatures would cede to Congress their power of establishing banks, saving the charter rights already granted. And this should be asked, not by way of amendment to the constitution, because until three fourths should consent nothing could be done; but accepted from them, one by one, singly, as their consent might be obtained." The principle he advances is predicated on the ground that the incorporation of banking companies for the circulation of notes is pernicious, but doubts whether three fourths of the States would surrender; and therefore, and for that reason only, suggests that the proposition should be made to the States singly, to cede their power of authorizing companies to issue notes of circulation. It is not to be presumed that Mr. Jefferson, who was always well known to be opposed to a United States Bank, intended to convey the idea, by the State Legislature ceding to Congress their power of establishing banks, which he speaks of, that it should be done in such a manner and to such extent as to enable Congress to establish [24th CoNG. 2d SESS. similar institutions, with the same power of circulating their paper, and controlling and depreciating the currency, as the State banks or the late Bank of the United States. Mr. Raymond, in his first volume of Political Economy, page 252, proposes that "Government manufacture a paper currency in the form of our present bank notes, payable in specie on demand at the Treasury, or at such other places as the convenience of the Government and the public may justify." In his second volume of the same work, he says: "Let it [the Government] take into its own hands the engraving and manufacturing of bank notes, all except the signatures, and establish a mint, and appoint officers, under proper responsibilities, for that purpose. "He is not explicit in his proposition as to the power of the Government to take into its hands either the issuing the notes or manu. facturing the paper under its control, to be issued by such officers as he speaks of. It may well be doubted if the National Government possesses any such power under the present provisions of the constitution. If it does not, it could not obtain it in any way but by an amendment in the mode provided in the constitution itself; and it may well be questioned if it would be sound policy to provide an amendment conferring such power on the National Government. Some have proposed such an amendment of the national constitution, providing that the banking incorporations in the States shall be graded, so that those of large capital may be limited to notes above one hundred or five hundred dollars, and those of smaller capital to the issue of notes of still smaller denomination, but that none should issue notes of less denomination than twenty dollars. If such a constitutional amendment were agreed to by the States, your committee entertain no doubt whatever that that it would tend much to purify the currency, if it could be enforced; but it would be extremely difficult to provide against its evasion, and the corrective of its violation must necessarily be left with the State Legislatures. Others, again, have suggested the propriety of amending the constitution in such manner as that no State incorporate banking institutions with power to issue notes beyond the amount of specie capital in their vaults. If such a provision could be carried into effect, it is believed the work of reform in the banking system would be accomplished. But little mischief, and much good, might flow from a system carried out on that principle. The great evils arising from the present systems spring from the power which the banks either possess or usurp, of extending their issues far beyond the amount of specie they have, and thus depreciating the whole circulating medium. The difficulty, however, would be to prevent evasion of such a provision. We have seen in the case of the Sutton Bank, placed under the immediate control of the law of its creation and existence, a glaring evasion of its clear and undoubted provisions, by the commission of a base fraud and falsehood. The more remote restraint of the federal constitution would be much more liable to evasion in the same way, and much more difficult to be applied as a corrective, than an act of the State Legislature. Gabriel Slaughter, Governor of Kentucky, in his message to the Legislature of that State, in 1818, holds the following language: "I am indeed ready to confess, before my countrymen, that my sentiments, or perhaps prejudices, ever have been, and still are, strongly against the banking system. I have ever viewed these moneyed corporations with jealousy. I consider the corporate powers and privileges conferred on them as so much taken from the power of the people, and a contrivance to rear up in the country a moneyed aristocracy. Money is power, in whatever hands it is placed; but it is less dangerous when divided among individuals, than when combined and organized in the form of banks. In vain did the American people, during their struggles for liberty and independence, destroy the landed aristocracy then existing under the law authorizing estates to be entailed, if a moneyed aristocracy is to be substituted. Instead of having our National and State Legislatures filled with men representing the feelings and interests of the great agricultural class of the community, I fear we shall see these banking aristocracies greatly preponderate on the legislative floor. I must ever be opposed to any system of policy which, independent of its pernicious and corrupting influence in other respects, tends to diminish, if not to destroy, the weight and influence of the farming interest, upon whose virtue and independence the duration of our free institutions so essentially depends. "While this system exists in other States, Kentucky can do little to rescue the country from the evil and antirepublican tendencies of these moneyed corporations. Let us, therefore, invite a co-operation in some plan, coextensive with the Union, to redeem this young and rising republic from the mischief and dangers of this paper system, before it is too late. If permitted to progress and interweave itself with all the interests and concerns of society, it may, in a more advanced and dense state of our population, explode in a convulsion of the Government. The disease, it is true, has taken deep root; but the American republic is young, and, by a vigorous and determined effort, may, in a few years, exterminate it. Some time may be necessary to enable these institutions to wind up. To effect so desirable an object, I would recommend to the Legislature to propose an amendment to the federal constitution, providing that, after a certain period, no incorporated bank should exist in the United States; or if this should be thought going too far, and banks in any shape, or to any extent, are useful and necessary, let the banking powers be limited, and the system so regulated and restricted, as to secure the community against the wide-spread ruin and mischief with which we are threatened." Resolutions were offered in the Legislature of that State on the 4th of January, 1819, in accordance with the sentiments of Governor Slaughter, but never carried out any further. proposition of an amendment to the constitution, that no State shall authorize any company or individuals to issue notes for circulation as bank notes. They do this, not with a view to the immediate action of Congress, which they deem at present as inexpedient and premature; but that some proposition may be thrown out in a tangible shape before the people, for their discussion and deliberation, should they feel that the subject is of sufficient importance to enlist their attention. Is there any thing unreasonable in the proposition? It is calculated to meet precisely the evils now, which were met by the provisions of the constitution then, as it was then adopted and now stands. Are the States less patriotic, less disposed to yield to each other for the good of the whole, than they were fifty years ago? Would not such a mutual concession of all promote the advantage and interest of each? If money would be scarcer, it would be proportionately better, and uniformly and permanently the same. We have now in the United States $140,301,038 of paper money in circulation, and about $30,000,000 of specie, or five and a half paper dollars for one of specie, in circulation; and about $40,000,000 specie in the banks, making about one specie dollar, in all, for three of paper. On the adoption of such an amendment as suggested, the banks would gradually cease as their charters expired, and the transition from a paper manufactured currency, subject to constant fluctuations and panics, to a steady and uniform standard of value, would be so slow and gradual, that it would not be felt to the same extent as has often been done by a sudden contraction of bank issues, after an excessive stimulus given by an expansion. Your committee cannot close this report without discharging a further duty to the memorialists. They have been assailed, both in Congress and out of it, as aiming to place the States under the control of the National Government, as though it were a great advantage to the States to have their citizens taxed for the support of bankers and 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 conand 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 commence alone. which exclude all possible idea of selfish or sinister moWhile the banks 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 meon 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. Your committee respectfully suggest whether it be not more appropriate, as well as more practicable, in adopting an amendment to the constitution, to provide against the kind or nature of institution, rather than the extent or mode of operations of any particular kind of institution; whether, for example, it would not more comport with the nature of a constitutional provision, that no State shall incorporate a bank of circulation, than that it shall incorporate no bank authorized to issue notes beyond a certain amount proportionate to its capital, or notes below a certain denomination. They have, therefore, thought proper, on full and deliberate consideration of the whole subject, as far as they have been able to investigate it, to submit the broadest | to respect! The suggestion they make is not new. It has been made by as wise and as good men as any by whom they have been assailed here and elsewhere. The spirit of inquiry is the life of republican Govern. ments, and should be rather promoted than discouraged, even if the sentiments advanced at the start are mistaken or erroneous. Whenever that is attempted to be stifled or hushed to silence by misrepresentation, persecution, or other weapons than those of reason and argument, it is a sure indication of some lurking tyranny that fears the light, suspicious or self-conscious of the defective tenure by which it rules. With these remarks, and with the purpose before indicated, your committee submit the following joint resolution : Agent of Deposite Banks. Resolved by the Senate and House of Representatives of the United States of America in Congress assembled, That the following amendment to the constitution of the United States be submitted to the Legislatures of the several States, for their ratification, agreeably to the provisions of the fifth article of the constitution : "No State shall authorize any incorporated company to issue any bank note, or other paper, for circulation." AGENT OF DEPOSITE BANKS. HOUSE OF REPRESENTATIVES, MARCH 1, 1837. Mr. Garland, of Virginia, from the select committee to which the subject had been referred, made the following report: [24th CoNG. 2d SESS. not produce, having reference to the necessity of explanation as affecting himself. The reservation is in these words: "To the adoption of the foregoing resolution Mr. Martin objected, upon the ground that he doubted the power of the committee, upon the showing then before them, to require the production of all the papers therein required; and moved for a division of the resolution, so as to take the question upon ordering the subpœna for Mr. R. M. Whitney, and the subpoena duces tecum to him separately; which motion was withdrawn, upon the understanding with the committee, generally, that the question of power to enforce the command, if objected to by Mr. Whitney, to whom the subpoena duces is directed, is reserved." The committee has not, in a single instance, attempted to enforce the production of any paper objected 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 underjoint 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 of the Treasury Department with said banks is conducted through said agent; and whether, in the transaction of any business confided to said agent, he receives any compensation from the Treasury Department," has had the same under consideration, and respectfully report: That, in making the inquiries committed to its charge, the committee has been compelled to encounter many questions of power and discretion of a most delicate and embarrassing nature; delicate, as sometimes encroaching upon the precincts of private reputation and private transactions; embarrassing as to the line of privacy and confidence beyond which the committee could not pass without violating private rights and private confidence. The first of these grew out of the protest of Reuben M. Whitney, a witness summoned before the committee to testify, (see journal, p. 67,) against the requirement of the committee in the resolution of the 7th of January last, found in the 4th page of the journal, and the powers of the House of Representatives to make the examination, as directed in the resolution organizing the committee, and directing its inquiries. It is not the purpose of the committee to enter into a long or detailed answer to said protest; they have not time, if they were disposed, nor is it necessary to do so. As relates to the resolution of the committee, the whole argument of the protest is based upon the idea that the committee has asserted a claim of power, in compelling the production of private papers, and in examining into private transactions, which it has not done; the resolution is general, and calls for no specific paper; it calls generally for such papers, &c. as may refer to, and shed light upon, the inquiries directed by the House. The committee, in adopting this resolution, made it general, because they had no knowledge of the particular character of the papers held by the witness, whether they were of a purely private or public character, and could not, therefore, designate any particular paper for which to make a call; and because they thought it due to the witness himself that he might have the opportunity of producing such papers of a private character as he might deem necessary for the purpose of explanation, if such explanation should be deemed necessary by him. Immediately following the adoption of the resolution referred to, the committee made an express res. ervation of the question, what papers they would or would not compel the production of, until the witness had determined, for himself, which he would or would such exposure. Yet, while the committee does not assert any such claim of power, it holds it decidedly within the power of Congress to ascertain, by other competent and legal testimony, any of the transactions of the deposite banks which are calculated to affect the safety of the public funds, and to render some action, on the part of Congress, necessary for their security. The second grew out of the propriety and effect of many interrogatories which the committee did not object to, or permitted to be propounded to various witnesses, affecting, as they might do, purely private transactions and private reputation. In this state of difficulty, it was thought best, and most comporting with justice to the witnesses themselves, to permit the inquiries to be made, and in every case leave the witness to determine for himself whether he would answer or not, as the committee could not upon all occasions determine how far the witness might desire to answer for the purpose of explanation, as before remarked. The committee does not deem it proper to conclude that, because a witness might refuse to answer what would in his estimation be a breach of confidence, the refusal ought to involve even a suspicion of guilt; if this were the case, the rule of legal and social propriety, which protects from scrutiny, by any tribunal, a man's private and confidential transactions, would be but a snare to deceive ignorant and entrap the unwary. The committee could not upon all occasions, when questions were proposed seemingly irrelevant, determine to what relevancy a train of interrogatory based upon it might lead; and could not, therefore, with propriety, withhold many interrogatories of that character which were propounded. The committee attempted to shape its course, under these delicate and embarrassing circumstances, by a just regard to the public interest and the private rights and reputation of individuals; if, in doing so, they have erred, they did so from motives any other than a disposition to become inquisitors of private character or private business. The resolution of the House directs the committee to make several inquiries, to which they will procced to respond in the order of the resolution. The first inquiry directed to be made is, "Whether the several banks employed for the deposite of the public money have all, or any of them, by joint or several contract, employed an agent to reside at the seat of Government, to transact their business at the Treasury Department.' The evidence before the committee, of the Hon. Levi have not, by joint or several contract, employed an agent, to reside at the seat of Government, to transact their business at the Treasury Department. In coming to this conclusion, the committee are well apprized, from the evidence before them, that there are some occasions upon which some of the deposite banks, through their agent, have presented some suggestions to the Treasury Department, in relation to the public deposites, and that these suggestions have received a respectful consideration, and perhaps may have induced some action on the part of the Secretary of the Treasury, in reference to them, such as the business referred to in the following extract from the report of the Secretary of the Treasury, to wit: 8. The names of the banks employing said agent are, with the few exceptions before alluded to, unknown to me except by rumor. "Besides the Planters' Bank at Natchez, and the Commercial Bank at Cincinnati, copies of whose correspondence have already been furnished, I think that in one or two cases of difference of opinion as to claims made by the banks through their agent, and in those alone, a written communication was shown to me by him, concerning the authority confided by them." [p. 13 of journal.] And the evidence of the Secretary of the Treasury, contained in his answer to the 44th question: "Question 44. In the cases alluded to in your report of the 11th instant, where the Planters' Bank, Natchez, and the Commercial Bank, Cincinnati, confided authority upon said Whitney, as shown to you in a written communication, what was that authority; what were the claims or requests made by him; what was the case of the Commercial Bank at New Orleans? Woodbury, Secretary of the Treasury, and many of the officers of several of the deposite banks, proves that several of the deposite banks have, by separate contract, appointed an agent to reside, and who does reside, at the seat of Government, charged with the duties of a corresponding agent of the banks by which he is employed; but it does not appear that he is clothed by these banks with any authority whatever to transact their business with or at the Treasury Department; on the contrary, it is proved, by the testimony of Mr. Woodbury, Mr. Whitney, several clerks of the Treasury Department, and the officers of the various deposite banks, that the agent has no such authority. For the correctness of this conclusion, the committee refers to the answer of the Secretary of the Treasury of the 11th January last, to their resolution of the 7th of the same month, on the 4th page of the journal, and his parole examination; to the testimony of McClintock Young, page 96, 3d paragraph of his answer to the 1st interrogatory; of James Howard, president, and James L. Hawkins, cashier, of the Franklin Bank of Baltimore, page 130, in which they say: "The entire business of the bank with that Department has uniformly been transacted by its president or cashier, directly with the Secretary at the head of the Department, the Treasurer of the United States, or one of the legally constituted officers of that Department." The testimony of Hugh W. Evans, president, and Robert Mickle, cashier, of the Union Bank of Maryland; in their 1st and 36th answers, page 132 and 133, they say: "The Union Bank of Maryland has never employed any agents to transact business with the Treasury Department, having always corresponded directly with it, touching its employment as a deposite bank." The testimony of James Schott, 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 "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 meet their Again, on page 243, No 12: "Our corresponding agent share of the anticipated division of the surplus and the may advise 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 exbank, 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, nally fixed. In respect to the Commercial Bank at New says: Agent of Deposite Banks. Orleans, the application by the agent was, according to my recollection, with a letter, setting out that the Department had, by transfers and warrants, drawn out, or proposed to draw out, all, or nearly all, the public money in its possession, and wishing him to request it to revoke some of the transfers, and possibly to postpone some to a much later day, if none could be revoked. I informed him that the bank must be in error, as, before signing a transfer, or sending one, I was always careful to see that it would not reduce a bank too low. I sent for the clerk who had charge of the subject, and examined into it critically; and declined to revoke any of them, as I felt satisfied that the bank and its agent considered the money the bank had been notified it would probably be called on to pay the State of Louisiana during 1837, but for which no transfers had then been issued; and which, I told him, would not be issued when the time of payment arrived, provided the bank should, before that time, be drawn down too low. I informed him, also, that the bank had, by mistake, included one transfer, in order to make out its case, which had never been issued, according to our records; and, hence, I could not revoke any that had been issued. He seemed to be satisfied that the bank was right. Whether any extension of time were given in this case, I do not remember, but know that none were given beyond the period of the quarterly payments to the States, for which purpose these transfers had been seasonably ordered." [Pages 59 and 60 of journal.] But these occasions, so far as disclosed by the evidence, have been rare, and not incompatible with the general conclusion to which the committee has arrived. In instituting this agency, the committee cannot perceive that the banks have violated any principle, either legal or moral, or violated their compact with the Government constituting them depositories of the public money. The several deposite banks, with the exception of the Bank of the Metropolis, in this District, received their charters from the several State Governments in which they are located, and are responsible to their several State authorities only; they have the undoubted right to institute agencies at their own expense, at any place, to transact any lawful business, without restriction on the part of this Government. If they, or any of them, have instituted an agency incompatible with the interests of the Government, or in violation of their compact, the only remedy in the hands of this Government is, in the first case, to discontinue the offensive banks as public depositories, and, in the second, to seek redress, through the proper judicial tribunals, for any injury sustained. The committee does not perceive that any part of the compact between the Treasury Department and the several deposite banks prohibits the institution of such an agency, and consequently that said agency is not in violation of it. If the Congress of the United States has the power to restrict the institution of lawful agencies on the part of banks deriving their powers from State authorities, they would have the same power to restrict individual agencies, and extend its powers into all the ramifications of social intercourse, however private and confidential, and mould them to its own views of propriety or purposes of power-a claim so startling, from its enormity, as to exclude even a moment's consideration as to its existence. It will be here proper to remark that Reuben M. Whitney is the agent of most of the deposite banks which employ one; but that one or two of them have other agents, whose names the committee deems it unnecessary to mention. The second subject of inquiry directed to the committee is, What is the character of the business said agent is employed to transact, and what compensation he receives? The committee, in responding to this inquiry, cannot do it more intelligibly or more accurately than by employing the language of the Secretary of the Treasury, and of the [24th CONG. 2d SESS. various officers of the deposite banks employing said agent, who have testified upon this occasion, and who describe the character of the agency referred to. The Secretary of the Treasury, in his response to the resolution of the committee, before referred to, says: "I know nothing with accuracy, beyond what has already been stated, as to the duties he is to discharge for those banks which employ him. But I presume, as just intimated, it is to communicate the earliest information on all subjects he may suppose to affect their interests, whether as public depositories or private banking institutions; to give his advice and aid when called for, or deemed useful in the transaction of their business of either character; to be the organ, at times, of presenting their wishes to the Department, in respect to subjects connected with their public obligations; and to procure here and communicate the best intelligence in his power on the state of the money market at home or abroad; on the condition of the currency and of the exchanges; and on the supposed legislation likely to happen in Congress, either as to the banks themselves or as to heavy appropriations to be paid by them; and, in fine, on any other topic which he may consider interesting or beneficial to his employers." In the same report, and in the testimony of the Secretary, the same description of the business of said agency is substantially given, perhaps in a mere minute and expanded form, to which the House is respectfully referred. The testimony of James Schott, president of the Girard Bank, states: That the Girard Bank has had, and still has, an agent, who resides at Washington, whose duty it is to communicate to his principal whatever information he may obtain touching the interest of the bank, and having a bearing upon its safe, useful, and profitable management.' The preamble and resolutions of the Bank of America, on page 161, are also descriptive of said agency :* "Whereas the opinion has been entertained and expressed that the interests of this bank, and the other banks in this city, as well as the interests of the commercial community, may be promoted by the employment of a suitable person, resident at Washington, to act as agent for the three deposite banks in this city, to obtain and communicate to them, with the full consent and approbation of the Secretary of the Treasury, seasonable information from time to time, on the following points, as well as other general or particular information, which may be useful and proper to communicate, viz: "The amount of revenue receivable at New York for a period of two or three months to come. "The amount, or probable amount, of public money to be disbursed here, or the amount that the three deposite banks in New York may be called upon to pay for that purpose, and for a like period. "The amount of public money that they may probably be required to transfer, and the time when and the place or places where the transfers are to be made. "Therefore, resolved, That the president and cashier of this bank be, and they are hereby, authorized, in cooperation and conjunction with the two other deposite banks of this city, or with the presidents and cashiers thereof, to appoint such person as they may deem suitable and proper to act as agent for the purposes aforesaid, and to agree to make the said agent suitable compensation for his services: Provided, That the amount to be paid him by this bank shall not exceed the sum of six hundred dollars per annum.' In the testimony of James Dodd and William T. Hooker, president and cashier of the Farmers and Mechanics' Bank of Connecticut, this agency is thus described: "To the 23d we answer, that R. M. Whitney, Esq. was the agent of this institution at Washington, as will appear by the documents hereto annexed, and on the terms therein specified, from whom we expected, and occasionally re |