openly admitting its connection with the presidential election. On seeing his proposed inquiry thus restricted, Mr. Clayton thus gave vent to his feelings:

gatory, and worse than useless. One proposition was to have the investigation made by the Committee of Ways and Means-a proposition which involved many departures from parliamentary law-from propriety-and from the "I hope I may be permitted to take a parting respect which the bank owed to itself, if it was leave of my resolution, as I very plainly perceive innocent. By all parliamentary law such a com- that it is going the way of all flesh. I discover mittee must be composed of members friendly this House, and at this late hour of the night the bank has a complying majority at present in to the inquiry-hearty in the cause-and the are determined to carry things in their own mover always to be its chairman: here, on the way; but, sir, I view with astonishment the contrary, the mover was to be excluded: the conduct of that majority. When a speaker rises very champion of the Bank defence was to be in favor of the bank, he is listened to with great attention; but when one opposed to it attempts the investigating chairman; and the committee to address the House, such is the intentional to whom it was to go, was the same that had noise and confusion, he cannot be heard; and, just reported so warmly for the Bank. But sir, the gentleman who last spoke but one in this proposition had so bad a look that the favor of an inquiry, had to take his seat in a chairman of the Committee of Ways and Means scene little short of a riot. I do not understand such conduct. When I introduced my resolu(Mr. McDuffie) objected to it himself, utterly tion, I predicated it upon the presumption that refusing to take the office of prosecutor against every thing in this House would, when respectan institution of which he was the public de- fully presented, receive a respectful considerafender. Propositions were then made to have tion, and would be treated precisely as all other questions similarly situated are treated. I exthe committee appointed by ballot, so as to take pected the same courtesy that other gentlemen the appointment of the committee out of the received in the propositions submitted by them, hands of the Speaker (who, following the par- that it would go to a committee appointed in liamentary rule, would select a majority of mem- the usual form, and that they would have the usual time to make their report. I believed, for bers favorable to inquiry); and in the vote by I had no right to believe otherwise, that all comballot, the bank having a majority in the House, mittees of this House were honest, and that they could reverse the parliamentary rule, and give had too much respect for themselves, as well as to the institution a committee to shield, instead for the House, to trifle with any matter confided to their investigation. Believing this, I did exof to probe it. Unbecoming, and even suspi-pect my resolution would be submitted in the cious to the institution itself as this proposition accustomed way; and if this House had thought was, it came within a tie vote of passing, and proper to trust me, in part, with the examinawas only lost by the casting vote of the Speaker. tion of the subject to which it refers, I would have proceeded to the business in good faith, Investigation of some kind, and by a select com- and reported as early as was practicable with mittee, becoming then inevitable, the only thing the important interests at stake. It has been that could be done in favor of the bank was to opposed in every shape; vote upon vote has restrict its scope; and this was done both as to been taken upon it, all evidently tending to evade inquiry; and now it is determined to time and matter; and also as to the part of the compel the committee to report in a limited institution to be examined. Mr. Adams intro- time, a thing unheard of before in this House, duced a resolution to limit the inquiry to the and our inquiries are to be confined entirely to operations of the mother bank, thereby skipping which more than half the frauds and oppressions the mother bank; whereas her branches, at the twenty-seven branches, though some of them complained of have been committed, are to go were nearer than the parent bank; also limiting unexamined, and we are to be limited to breaches the points of inquiry to breaches of the charter, of the charter when the abuses charged are nuso as to cut off the abuses; also limiting the time merous and flagrant, and equally injurious to to a short day (the 21st of April)-March then books of the parent bank, the greatest part of the community. We are only to examine the being far advanced; so as to subject full inves- which may be accidentally from home, at some tigation to be baffled for the want of time. The of the branches. If the bank can reconcile it to reason given for these restrictions was to bring herself to meet no other kind of investigation but the investigation within the compass of the such an insincere and shuffling course is calculatthis, she is welcome to all the advantages which session-so as to insure action on the applicationed to confer; the people of this country are too Defore the adjournment of Congress-thereby intelligent not to understand exactly her object."

Among the abuses cut off from examinations time the draft becomes due, whereby it is proby these restrictions, were two modes of ex- tested for want of funds, it returns upon him torting double and treble compensation for the use of money, one by turning a loan note into a bill of exchange, and the other by forcing the borrower to take his money upon a domestic bill instead of on a note-both systematically practised upon in the West, and converting nearly all the Western loans into enormously usurious transactions. Mr. Clayton gave the following description of the first of these modes of extorting usury:

"I will now make a fuller statement; and I think I am authorized to say that there are gentlemen in this House from the West, and under my eye at present, who will confirm every word I say. A person has a note in one of the Western branch banks, and if the bank determines to extend no further credit, its custom is, when it sends out the usual notice of the time the

with the additional cost of ten per cent. for non-payment. Now, sir, that is what is meant by domestic bills of exchange, disguised as loans, to take more than six per cent.; for, mark, Mr. Speaker, the bank does not purchase a bill of exchange by paying out cash for it, and receiving the usual rate of exchange, which varies from one-quarter to one per cent.; but it merely delivers up the poor debtor's note which was previously in bank, and, what is worse, just as well secured as the domestic bill of exchange which they thus extort from him in lieu thereof. And while they are thus exacting this per cent. from him, they are discounting bills for others not in debt to them at the usual premium of one per cent. The whole scene seems to present the picture of a helpless sufferer in the hands of a ruffian, who claims the merit of charity for discharging his victim alive, after having torn away half his limbs from his body."

The second mode was to make the loan take

stance payable in some village hard by, where they could go to redeem it without giving commissions to intermediate agents in the shape of endorsers and brokers. The profit to the bank in this operation was to get six per centum interest, and two per cent. exchange; which, on a sixty days' bill, was twelve per cent. per annum; and, added to the interest, eighteen per cent. per annum ; with the addition of ten per centum damages if the bill was protested; and of this character were the mass of the loans in the West-a most scandalous abuse, but cut off, with a multitude of others, from investigation from the restrictions placed upon the powers of the committee.

note falls due, to write across the notice, in the form of a domestic bill from the beginning; red ink, these three fatal words-well understood in that country-Payment is expectand this soon came to be the most general praced.' This notice, thus rubricated, becomes a tice. The borrowers finding that their notes death-warrant to the credit of that customer, were to be metamorphosed into bills payable in unless he can raise the wind, as it is called, to a distant city, readily fell into the more conpay it off, or can discount a domestic bill of ex-venient mode of giving a bill in the first inchange. This last is done in one of two ways. If he has a factor in New Orleans who is in the habit of receiving and selling his produce, he draws upon him to pay it off at maturity. The bank charges two per centum for two months, the factor two and a half, and thus, if the draft is at sixty days, he pays at the rate of twentyseven per centum. If, however, he has no factor, he is obliged to get some friend who has one to make the arrangement to get his draft accepted. For this accommodation he pays his friend one and a half per cent., besides the two per cent. to the bank, and the two and a half per cent. to the acceptor; making, in this mode of arrangement, thirty-six per cent. which he pays before he can get out of the clutches of the bank for that time, twelve per cent. of which, in either case, goes to the bank; and so little conscience have they, in order to make this, they will subject a poor and unfortunate debtor The supporters of the institution carried tneir to the other enormous burdens, and consequently to absolute beggary. For it must be obvious point in the House, and had the investigation to every one that such a per cent. for money, in their own way; but with the country it was under the melancholy depreciation of produce different. The bank stood condemned upon its every where in the South and West, will soon own conduct, and badly crippled by the attacks wind up the affairs of such a borrower. No people under the heavens can bear it; and un- upon her. More than a dozen speakers assailed less a stop is put to it, in some way or other, I her: Clayton, Wayne, Foster of Georgia; J. M. predict the Western people will be in the most Patton, Archer, and Mark Alexander of Virdeplorable situation it is possible to conceive. ginia; James K. Polk of Tennessee; CambreThere is another great hardship to which this debtor is liable, if he should not be able to fur- leng, Beardsley, Hoffman and Angel of Newnish the produce; or, which is sometimes the York; Mitchell and Blair of South Carolina; case, if it is sacrificed in the sale of it at the Carson of North Carolina; Leavitt of Ohio.

against the bank, disputed the reality of the majority, saying that the good nature of Colonel Johnson had merely licensed it. On the other hand, the committee was as favorably composed for the bank-Mr. Adams and Mr. McDuffie both able writers and speakers, of national reputation, investigating minds, ardent temperaments, firm believers in the integrity and usefulness of the corporation; and of char acter and position to be friendly to the institu tion without the imputation of an undue mo tive. Mr. Watmough was a new member, but acceptable to the bank as its immediate representative, as the member that had made the motions to baffle investigation; and as being from his personal as well as political and social relations, in the category to form, if necessary, its channel of confidential communication with the committee.

The speakers on the other side were: McDuffie in invalidating the report of the majority and Drayton of South Carolina; Denny, Crawford, Coulter, Watmough, of Pennsylvania; Daniel of Kentucky; Jenifer of Maryland; Huntington of Connecticut; Root and Collins of New-York; Evans of Maine; Mercer of Virginia; Wilde of Georgia. Pretty equally matched both in numbers and ability; but the difference between attack and defence-between bold accusation and shrinking palliation-the conduct of the bank friends, first in resisting all investigation, then in trying to put it into the hands of friends, then restricting the examination, and the noise and confusion with which many of the anti-bank speeches were saluted gave to the assailants the appearance of right, and the tone of victory throughout the contest; and created a strong suspicion against the bank. Certainly its conduct was injudicious, except upon the hypothesis of a guilt, the worst suspicion of which would be preferable to open detection; and such, eventually, was found to be the fact. In justice to Mr. McDuffie, the leading advocate of the bank, it must be remember-crimination of the bank on many points—usury, ed that the attempts to stifle, or evade inquiry, did not come from him but from the immediate representative of the bank neighborhood-that he twice discountenanced and stopped such attempts, requesting them to be withdrawn; and no doubt all the defenders of the bank at the time believed in its integrity and utility, and only followed the lead of its immediate friends in the course which they pursued. For myself I became convinced that the bank was insolvent, as well as criminal; and that, to her, examination was death; and therefore she could not face it.

The committee made three reports-one by the majority, one by the minority, and one by Mr. Adams alone. The first was a severe re

issuing branch bank orders as a currency, selling coin, selling stock obtained from government under special acts of Congress, donations for roads and canals, building houses to rent or sell, loans unduly made to editors, brokers, and members of Congress. The adversary reports were a defence of the bank on all these points, and the highest encomiums upon the excellence of its management, and the universality of its utility; but too much in the spirit of the advocate to retain the character of legislative reports-which admit of nothing but facts stated, inductions drawn, and opinions expressed. Both, or rather all three sets of reports, were received as veracious, and lauded as victorious, by the respective parties which they favored; and quoted, as settling for ever the bank question, each way. But, alas, for the effect of the progress of events! In a few brief years all this

The committee appointed were: Messrs. Clayton, Richard M. Johnson of Kentucky, Francis Thomas of Maryland, and Mr. Cambreleng of New-York, opposed to the recharter of the Bank; Messrs. McDuffie, John Quincy Adams, and Watmough, in favor of it. The committee was composed according to the par-attack and defence-all this elaboration of acculiamentary rule-the majority in favor of the object-but one of them (Colonel Johnson of Kentucky), was disqualified by his charitable and indulgent disposition for the invidious task of criminal inquisition; and who frankly told the House, after he returned, that he had never looked at a bank-book, or asked a question while he was at Philadelphia; and, Mr. Adams, VOL. I.-16

sation, and refinement of vindication-all this zeal and animosity, for and against the bankthe whole contest-was eclipsed and superseded by the actualities of the times-the majority report, as being behind the facts: the minority, as resting upon vanished illusions. And the great bank itself, antagonist of Jackson, called imperial by its friends, and actually constituting

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.

a power in the State-prostrate in dust and thirteen and a quarter millions would become ashes - and invoking from the community, obligatory under a policy which eschewed all through the mouth of the greatest of its advo- debt-a consummation then rapidly approachcates (Mr. Webster), the oblivion and amnesty ing, under General Jackson's administration—it of an "obsolete idea." 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:

CHAPTER LXV.

THE THREE PER CENT. DEBT, AND LOSS IN NOT
PAYING IT WHEN THE RATE WAS LOW, AND
THE MONEY IN THE BANK OF THE UNITED

STATES WITHOUT INTEREST.

"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 statements respecting his resolutions on alum morials were poured in upon us by command of salt, which were erroneous. Day by day, methe bank, all representing, in the same terms, the necessity of renewing its charter. These memorials, the tone of which, and the time of were daily ordered to be printed. These papers, their presentation, showed their common origin,

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 interest was six per centum, and actual interest often more. In 1817, when the Bank of the United States went into operation, the price of that stock was sixty-four per centum-the money was in bank, more than enough to pay 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 government 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, the praises of the bank, were ordered to be he had moved to have printed for the benefit of printed without hesitation. The report which the farmers, was struck at by the senator of New Jersey. In the first place, the senator was in error as to the cost of printing the report. He had stated it to be one thousand nine hundred dollars, whereas it was only one thousand one hundred dollars. A few days ago, two thousand copies of a report of the British House of Commons on the subject of railroads was ordered to be printed. Following the language another report of that body, which would interest of that resolution, he had moved the printing of a thousand of our citizens, where that report would interest one. There was not a farmer in