a power in the State-prostrate in dust and thirteen and a quarter millions would become ashes and invoking from the community, through the mouth of the greatest of its advocates (Mr. Webster), the oblivion and amnesty of an "obsolete idea." It is not the design of this View to explore these reports for the names of persons implicated (some perhaps unjustly), in the criminating statements of the majority. The object proposed in this work does not require that interference with individuals. The conduct of the institution is the point of inquiry; and in that conduct will be found the warning voice against the dangers and abuses of such an establishment in all time to come. CHAPTER LXV. THE THREE PER CENT. DEBT, AND LOSS IN NOT obligatory under a policy which eschewed all debt-a consummation then rapidly approaching, under General Jackson's administration-it was clear that the treasury would pay one hundred cents on the dollar on what could be then purchased for sixty-odd, losing in the mean time the interest on the money with which it could be paid. It made a case against the bank, which it felt itself bound to answer, and did so through senator Johnson, of Louisiana: who showed that the bank paid the debt which the commissioners of the sinking fund required. This was true; but it was not the point in the case. The point was that the money was kept in deposit to sustain the bank, and the enlargement of the powers of the commissioners resisted to prevent them from purchasing this stock at a low rate, in view of its rise to par: which soon took place; and made palpable the loss to the United States. At the time of the solicited renewal of the charter, this non-payment of the three per cents was brought up as an instance of loss incurred on account of the bank; and gave rise to the defence from Mr. Johnson; to which I replied: "Mr. Benton had not intended, he said, to say a word in relation to this question, nor should had fallen from the senator from New Jersey. he now rise to speak upon it, but from what That gentleman had gone from the resolution to the bank, and from the bank he had gone to THERE was a part of the revolutionary debt, incurred by the States and assumed by Congress, amounting to thirteen and a quarter millions of dollars, on which an interest of only three per centum was allowed. Of course, the stock of this debt could be but little over fifty cents in the dollar in a country where legal in-statements respecting his resolutions on alum salt, which were erroneous. Day by day, meterest was six per centum, and actual interest morials were poured in upon us by command of often more. In 1817, when the Bank of the the bank, all representing, in the same terms, United States went into operation, the price of the necessity of renewing its charter. These that stock was sixty-four per centum-the memorials, the tone of which, and the time of money was in bank, more than enough to pay their presentation, showed their common origin, were daily ordered to be printed. These papers, it-a gratuitous deposit, bringing no interest-forming a larger mass than we ever had on our and which was contained in her vaults-her situation soon requiring the aid of the federal govcrnment to enable her to keep her doors open. I had submitted a resolve early in my term of service to have this stock purchased at its market value; and for that purpose to enlarge the power of the commissioners of the sinking fund, then limited to a price a little below the current rate: a motion which was resisted and defeated by the friends of the bank. I then moved a resolve that the bank pay interest on the deposits: which was opposed and defeated in like manner. Eventually, and when the rest of the public debt should be paid off, and the payment of these tables before, and all singing, to the same tune, It America who would not deem it a treasure. covered the whole saline kingdom; and those unacquainted with its nature had no more idea of it than a blind man had of the solar rays. It was of the highest value to the farmer and the CHAPTER LXVI. RECHARTER REPORTED IN THE SENATE-AND grazier. It showed the effect of the mineral king- BANK OF THE UNITED STATES-BILL FOR THE dom upon the animal kingdom; and its views were the results of the wisdom, experience, and first talents of Great Britain. The assertion of the senator, that the bank aided in producing a THE first bank of the United States, chartered sound currency, he would disprove by facts and in 1791, was a federal measure, conducted under dates. In 1817 the bank went into operation. the lead of General Hamilton-opposed by Mr. In three or four years after, forty-four banks Jefferson, Mr. Madison and the republican party; were chartered in Kentucky, and forty in Ohio; and the United States Bank, so far from being and became a great landmark of party, not able to put them down, was on the verge of merely for the bank itself, but for the latitudibankruptcy. With the use of eight millions of narian construction of the constitution in which public money, it was hardly able, from day to it was founded, and the great door which it day to sustain itself. Eleven millions of dollars, as he could demonstrate, the people had lost by opened to the discretion of Congress to do what maintaining the bank during this crisis. But it pleased, under the plea of being "necessary” for a waggon load of specie from the mint, as to carry into effect some granted power. The Mr. Cheves informs us, it would have become non-renewal of the charter in 1811, was the act bankrupt. In addition to this, the use of gov- of the republican party, then in possession of ernment deposits, to the extent of eight millions, was necessary to sustain it; and the country lost the government, and taking the opportunity to eleven millions by the diversion of those deposits terminate, upon its own limitation, the existence to this purpose. Congress authorized the pur- of an institution, whose creation they had not chase of the thirteen millions of three per cents. been able to prevent. The charter of the second -at that time, they could have been purchased at sixty-five cents, now they were at ninety-six bank, in 1816, was the act of the republican per cent. This was one item of the amount party, and to aid them in the administration of lost, and the other was the interest on the the government, and, as such, was opposed by stock from that time to the present, amounting the federal party-not seeming then to underto six millions more. It was shown by Mr. Cheves that the United States Bank owed its stand that, by its instincts, a great moneyed existence to the local banks-to the indulgence corporation was in sympathy with their own and forbearance of the banks of Philadelphia and party, and would soon be with it in action Boston, notwithstanding its receipt of the silver-which this bank soon was—and now struggled from Ohio and Kentucky, which drained that country, destroyed its local banks, and threw down the value of every description of its property. The United States Bank currency was called by the senator the poor man's friend. The orders on the branches-these drafts issued in Dan and made payable in Beersheba-had their origin with a Scotchman; and, when their character was discovered, they were stopped as oppressive to the poor; and this bank, which was cried up as the poor man's friend, issued those same orders, in paper so similar to that of the bank notes, that the people could not readily discern the difference between them. It was thought that the people might mistake the signature of the little cashier and the little president for the great cashier and the great president. The stockholders were foreigners, to a great extent-they were lords and ladies-reverend clergymen and military officers. The widows, in whose behalf our sympathy was required, were countess dowagers, and the Barings, some of whom owned more of the stock than was possessed in sixteen States of this Union." for a continuation of its existence under the lead of those who had opposed its birth, and against the party which created it. Mr. Webster was a federal leader on both occasionsagainst the charter, in 1816; for the recharter, in 1832-and in his opening speech in favor of the renewal, according to the bill reported by the Senate's select committee, and in allusion to these reversals of positions, and in justification of his own, he spoke thus, addressing himself to the Vice-President, Mr. Calhoun : "A considerable portion of the active part of life has elapsed, said Mr. W., since you and I, Mr. President, and three or four other gentlemen, now in the Senate, acted our respective parts in the passage of the bill creating the present Bank of the United States. We have lived to little purpose, as public men, if the experience of this period has not enlightened our judgments, and enabled us to revise our opinions; and to correct any errors into which we may have fallen, if such errors there were, either in regard to the He also spoke truly on the subject of the small quantity of silver currency in the United States-only some twenty-two millions-and not a particle of gold; and deprecated the small bank note currency as the cause of that evil. He said: general utility of a national bank, or the details necessary for the support of the social system, of its constitution. I trust it will not be unbe- and encourages propensities destructive of its coming the occasion, if I allude to your own happiness. It wars against industry, fruimportant agency in that transaction. The bill gality, and economy; and it fosters the evil incorporating the bank, and giving it a constitu- spirits of extravagance and speculation. Of all tion, proceeded from a committee of the House the contrivances for cheating the laboring classes of Representatives, of which you were chairman, of mankind, none has been more effectual than and was conducted through that House under that which deludes them with paper money. your distinguished lead. Having recently looked This is the most effectual of inventions to ferback to the proceedings of that day, I must be tilize the rich man's field, by the sweat of the permitted to say that I have perused the speech poor man's brow. Ordinary tyranny, oppresby which the subject was introduced to the con- sion, excessive taxation, these bear lightly on sideration of the House, with a revival of the the happiness of the mass of the community, feeling of approbation and pleasure with which compared with fraudulent currencies, and the I heard it; and I will add, that it would not, robberies committed by depreciated paper. Our perhaps, now, be easy to find a better brief own history has recorded for our instruction synopsis of those principles of currency and of enough, and more than enough, of the demorbanking, which, since they spring from the na- alizing tendency, the injustice, and the intolerature of money and of commerce, must be essen- ble oppression on the virtuous and well disposed, tially the same, at all times, in all commercial of a degraded paper currency, authorized by law, communities, than that speech contains. The or any way countenanced by government. other gentlemen now with us in the Senate, all of them, I believe, concurred with the chairman of the committee, and voted for the bill. My own vote was against it. This is a matter of little importance; but it is connected with other circumstances, to which I will, for a moment, advert. The gentlemen with whom I acted on that occasion, had no doubts of the constitutional power of Congress to establish a national bank; nor had we any doubts of the general utility of an institution of that kind. We had, indeed, most of us, voted for a bank, at a preceding session. But the object of our regard was not whatever might be called a bank. We required that it should be established on certain principles, which alone we deemed safe and useful, inade subject to certain fixed liabilities, and so guarded that it could neither move voluntarily, nor be moved by others out of its proper sphere of action. The bill, when first introduced, con"Why have we so small an amount of specie in tained features, to which we should never have circulation? Certainly the only reason is, beassented, and we set ourselves accordingly to cause we do not require more. We have but to work with a good deal of zeal, in order to effect ask its presence, and it would return. But we sundry amendments. In some of those proposed voluntarily banish it by the great amount of amendments, the chairman, and those who acted small bank notes. In most of the States the with him, finally concurred. Others they banks issue notes of all low denominations, opposed. The result was, that several most down even to a single dollar. How is it possiimportant amendments, as I thought, prevailed. ble, under such circumstances, to retain specie But there still remained, in my opinion, objec- in circulation? All experience shows it to be tions to the bill, which justified a persevering opposition till they should be removed." He spoke forcibly and justly against the evils of paper money, and a depreciated currency, meaning the debased issues of the local banks, for the cure of which the national bank was to be the instrument-not foresceing that this great bank was itself to be the most striking exemplification of all the evils which he depicted. He said: "The paper circulation of the country is, at this time, probably seventy-five or eighty millions of dollars. Of specie we may have twenty or twenty-two millions: and this, principally, in masses in the vaults of the banks. Now, sir, this is a state of things which, in my judgment, leads constantly to overtrading, and to the consequent excesses and revulsions which so often disturb the regular course of commercial affairs. impossible. The paper will take the place of the gold and silver. When Mr. Pitt, in the year 1797, proposed in Parliament to authorize the Bank of England to issue one pound notes, Mr. Burke lay sick at Bath of an illness from which he never recovered; and he is said to have written to the late Mr. Canning, Tell Mr. Pitt that if he consents to the issuing of one pound notes, he must never expect to see a guinea again. The bill provided that a bonus of $500,000 "A disordered currency is one of the greatest in three equal annual instalments should be of political evils. It undermines the virtues paid by the bank to the United States for its exclusive privileges: Mr. Webster moved to the directors and politicians, or rather of the modify the section, so as to spread the payment politicians and directors; for the former govover the entire term of the bank's proposed ex-erned the decision. The stockholders in their istence-$150,000 a year for fifteen years. I meeting last September only authorized the was opposed both to the bonus, and the exclu- president and directors to apply at any time sive privilege, and said: before the next triennial meeting-at any time within three years; and that would carry the application to the right time. I, therefore, inveighed against the present application, and insisted that: "The proper compensation for the bank to make, provided this exclusive privilege was sold to it, would be to reduce the rate of interest on loans and discounts. A reduction of interest would be felt by the people; the payment of a bonus would not be felt by them. It would rome into the treasury, and probably be lavished immediately on some scheme, possibly unconstitutional in its nature, and sectional in its application. He was not in favor of any scheme for getting money into the treasury at present. The difficulty lay the other way. The struggle now was to keep money out of the treasury, to prevent the accumulation of a surplus; and the reception of this bonus would go to aggravate that difficulty, by increasing that surplus. Kings might receive bonuses for selling exclusive privileges to monopolizing companies. In that case his subjects would bear the loss, and he would receive the profit; but, in a republic, it was incomprehensible that the people should sell to a company the privilege of making money out of themselves. He was opposed to the grant of an exclusive privilege; he was opposed to the sale of privileges; but if granted, or sold, he was in favor of receiving the price in the way that would be most beneficial to the whole body of the people; and, in this case, a reduction of interest would best accomplish that object. A bank, which had the benefit of the credit and revenue of the United States to bank upon, could well afford to make loans and discounts for less than six per centum. Five per centum would be high interest for such a bank; and he had no doubt, if time was allowed for the application, that applications enough would be made to take the charter upon these terms." I opposed action on the subject at this session. The bank charter had yet four years to run, and two years after that to remain in force for winding up its affairs; in all, six years before the dissolution of the corporation: and this would remit the final decision to the Congress which would sit between 1836 and 1828, and there was not only to be a new Congress elected before that time, but a new Congress under a new apportionment of the representation, in which there would be a great augmentation of members, and especially in the West, where the operation of the present bank was most injurious. The stockholders had not applied for the recharter at this session: that was the act of "Many reasons oppose the final action of Congress upon this subject at the present time. We are exhausted with the tedium, if not with the labors of a six months' session. Our hearts and minds must be at home, though our bodies are here. Mentally and bodily we are unable to give the attention and consideration to this question, which the magnitude of its principles, the extent and variety of its details, demand from us. Other subjects of more immediate and pressing interest must be thrown aside, to make way for it. The reduction of the price of the public lands, for which the new States have been petitioning for so many years, and the modification of the tariff, the continuance of which seems to be weakening the cement which binds this Union together, must be postponed, and possibly lost for the session, if we go on with the bank question. Why has the tariff been dropped in the Senate? Every one recollects the haste with which that subject was taken up in this chamber; how it was pushed to a certain point; and how suddenly and gently it has given way to the bank bill! Is there any union of interest-any conjunction of forces any combined plan of action-any alliance, offensive or defensive, between the United States Bank and the American system? Certainly they enter the field together, one here, the other yonder (pointing to the House of Representatives), and leaving a clear stage to each other, they press at once upon both wings, and announce a perfect non-interference, if not mutual aid, in the double victory which is to be achieved. Why have the two bills reported by the Committee on Manufactures, and for taking up which notices have been given: why are they so suddenly, so easily, so gently, abandoned? committee, and a pledge given to call it up Why is the land bill, reported by the same when the Committee on Public Lands had made their counter report, also suffered to sleep on the table? The counter report is made; it is with the lands, when the settlement of the quesprinted; it lies on every table; why not go on tion of the amount of revenue to be derived from that source precedes the tariff question, and must be settled before we can know how much revenue should be raised from imports. "An unfinished investigation presented another reason for delaying the final action of Con gress on this subject. The House of Representa tives had appointed a committee to investigate sudden haste which interrupts an unfinished the affairs of the bank; they had proceeded to investigation-sets aside the immediate business the limit of the time allotted them-had report- of the people-and usurps the rights of our suced adversely to the bank-and especially against cessors? No plea in the world, except that a the renewal of the charter at this session; and gigantic moneyed institution refuses to wait, had argued the necessity of further examina- and must have her imperial wishes immediately tions. Would the Senate proceed while this gratified. If a charter was to be granted, it unfinished investigation was depending in the should be done with as little invasion of the other end of the building? Would they rights of posterity-with as little encroachment act so as to limit the investigation to the few upon the privileges of our successors--as possiweeks which were allowed to the committee, ble. Once in ten years, and that at the comwhen we have from four to six years on hand mencement of each full representation under a within which to make it? The reports of new census, would be the most appropriate this committee, to the amount of some 15,000 time; and then charters should be for ten, and copies had been ordered to be printed by the not twenty years. two Houses, to be distributed among the people. "Mr. B. had nothing to do with motives. He For what purpose? Certainly that the people neither preferred accusations, nor pronounced might read them-make up their minds upon absolutions: but it was impossible to shut his their contents-and communicate their senti- eyes upon facts, and to close up his reason against ments to their representatives. But these re- the induction of inevitable inferences. The preports are not yet distributed; they are not yet sidental election was at hand;-it would come read by the people; and why order this distri-in four months;-and here was a question which, bution without waiting for its effect, when there in the opinion of all, must affect that election is so much time on hand? Why treat the peo--in the opinion of some, may decide it—which ple with this mockery of a pretended consulta- is pressed on for decision four years before it is tion-this illusive reference to their judgment- necessary to decide it, and six years before it while proceeding to act before they can read ought to be decided. Why this sudden pressure? what we have sent to them? Nay, more; the Is it to throw the bank bill into the hands very documents upon which the reports are of the President, to solve, by a practical reference, founded are yet unprinted! The Senate is ac- the disputed problem of the executive veto, and tually pushed into this discussion without hav-to place the President under a cross fire from the ing seen the evidence which has been collected by the investigating committee, and which the Senate itself has ordered to be printed for the information of its members. opposite banks of the Potomac River? He[Mr. B. knew nothing about that veto, but he knew something of human nature, and something of the rights of the people under our representative "The decision of this question does not belong form of government; and he would be free to to this Congress, but to the Congress to be say that a veto which would stop the encroachelected under the new census of 1830. It ment of a minority of Congress upon the rights looked to him like usurpation for this Congress of its successors-which would arrest a frightto seize upon a question of this magnitude, which ful act of legislative usurpation-which would required no decision until the new and full rep- retrieve for the people the right of deliberation, resentation of the people shall come in; and and of action-which would arrest the overwhelmwhich, if decided now, though prematurely and ing progress of a gigantic moneyed institutionby usurpation, is irrevocable, although it cannot which would prevent Ohio from being deprived take effect until 1836;-that is to say, until of five votes, Indiana from losing four, Tennessee three years after the new and full representa- four, Illinois two, Alabama two, Kentucky, Mistion would be in power. What Congress is sissippi and Missouri one each-which would this? It is the apportionment of 1820, formed lose six votes to New-York and two to Pennsylon a population of ten millions. It is just going vania; a veto, in short, which would protect the out of existence. A new Congress, apportioned rights of three millions of people, now unrepreupon a representation of thirteen millions, is sented in Congress, would be an act of constitualready provided for by law; and after the 4th tional justice to the people, which ought to raise of March next-within nine months from this the President, and certainly would raise him, to a day-will be in power, and entitled to the seats higher degree of favor in the estimation of every in which we sit. That Congress will contain republican citizen of the community than he now thirty members more than the present one. enjoyed. By passing on the charter now, ConThree millions of people-a number equal to gress would lose all check and control over the that which made the revolution-are now un-institution for the four years it had yet to represented, who will be then represented. The West alone that section of the Union which suffers most from the depredations of the bank -loses twenty votes! In that section alone a million of people lose their voice in the decision of this great question. And why? What excuse? What necessity? What plea for this run. The pendency of the question was a rod over its head for these four years; to decide the question now, is to free it from all restraint, and turn it loose to play what part it pleased in all our affairs-elections, State, federal, presidential. "Mr. B. turned to the example of England, |