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stake, loses the characteristic prudence of commercial activities, but admitting only of the capitalist.
employment for evil, it would be a ground A casual and superficial observer might of grave accusation, that any system should detect a supposed departure from this prin- furnish such facilities. Capital may be reciple in the New York system. By as- garded as the vital principle of commercial suming the securities standing in the place life, equally capable of a true or false diof the actual property-capital, to represent rection; to hold it responsible, then for the merely a credit, it would appear that the use which is made of it, is as absurd as to credit loaned upon that capital, was but charge the principle of animal life with all credit raised upon credit. But the strength the irregularities to which it ministers their and beauty of that system appears by a active power. closer observation of its principles, to sub Speculation is the product of moral sist in part, in the fact, that the credit that causes, and not the result of physical it extends is based upon actual capital, in- combinations. It springs from a desire for stead of mere credit.
the acquisition of sudden wealth, and is atIt cannot with any propriety be said, tended by an excited state of mind ready to that he who loans to another upon the se- risk every present good, for the sake of curity of a pledge of property-relies upon some anticipated advantage. It is not unithe credit of the borrower, for he holds the formly observed to predominate at times property pledged, and is so far to be re- when the use of capital is readily procured ; garded its owner, that if that which was but often arises when the ordinary operaborrowed is not returned, the pledge is re tions of trade are straitened for lack of tained. So the faith of the public pledged means. This fact of itself, illustrates the in its stocks, ought to be regarded as a se- absurdity of charging the origination of curity superior to all individual credits, and speculative feeling upon those causes which standing on an equal footing with the pos- supply the material means of trading. Of session of any tangible property; for as the all classes capitalists are least apt to be security of property is dependent upon the speculative, while they view such illicit maintainance of the public faith, so the operations with a degree of distrust suffipledge of that faith secures the highest evi- cient to prevent them from entrusting their dence of a permanent possession. Resting property with those that indulge in them. on such a basis, no credit can be deemed The bank as a capitalist is actuated by the insecure.
same impulses to a safe and regular investMany evils have been attributed to ment of its capital, and thus becomes an banks, some of which are the result of the instrument of conservatism. introduction of the erroneous principle in One of many instances may be cited ilbanking which we have already pointed lustrating the practical truth of this idea. out, while others are nowise chargeable to The shifting of the balance of trade in our that cause. Among others, that of induc- favor in consequence of the large exportaing speculation, has been with some, a prin- tions of grain, during the year 1847, incipal ground of objection to the allowance duced larger importations from abroad of banking privileges. This charge has than is usual, and a consequent efflux of been urged with that undiscriminating zeal specie towards foreign markets. To that involves both the good and evil in a check this tendency the banks restricted system in accusations belonging to the lat- their discounts, taking good care that their ter only. As banking has in many in- funds should not fall into the hands of those stances been conducted, the charge is not who required specie for exportation. To unmerited, but it is the abuse of the prin- a considerable extent the movement of the ciple which has given occasion to the banks had the desired effect, and operated charge of fostering speculation.
to repress foreign speculation. In one respect only, has legitimate bank Without justifying the opposition to ing an influence in promoting speculation, banks, which has to a greater or less exand that is by furnishing the means which tent prevailed in different sections of our may be employed towards speculative ob- country, and has in many instances erected jects. If speculation made use of means itself into an open and bitter hostility, it which are not the common source of all would do injustice both to popular discrim
ination and to truth, to deny that some legislation, the sympathy of our governgrounds for it have not existed. Banking ment has always been with the people. has too often been conducted with utter And it is one of the happiest circumstances, disregard to the principle that requires the that when we have been in error, not even bank to possess the qualities of a capitalist, the blinding influence of party zeal, has to shield these institutions from just cen- prevented us from discovering and correctsures. Had this evil been incurable, it is ing the mistake. doubtful whether on the whole, the de The state governments exhibit more instruction of the entire system would not stances of this character, than are to be have led to less inconveniences, than the found in the history of the federal legislairregularities occasioned by it. But the tion, from the fact that they embrace a experience of the State of New York wider range of objects, and have a more places it beyond a doubt, that by the aid direct and immediate influence upon the of restrictive legislation, the usefulness of interests of individuals. the system may be preserved without di To ascertain then, where legislation may minishing the profits which invites to that with propriety be applied, it is only necesmode of employing surplus capital. sary to consider whether the result of its
It has been seriously questioned whether application will be beneficial to the comthe soundest condition of banking would mon interest. By this simple test we are not be produced by letting the banks loose to judge, whether banking should or should from restrictive legislation, and leaving not be exempt from legislative restriction. them to be regulated by the laws of com Experience has abundantly shewn, that petition, and of enlightened self-interest. the law of competition is not sufficient to
The opinions that are held with respect secure the best condition of banking. It to the purposes of legislation, form the may indeed be sufficient to render the great distinguishing feature of the two merchant careful of his credit, and consegreat parties of our country. On the one quently restrain him from excesses; but hand a theory prevails, that the only office this is because the eye of a cautious capiof legislation is to preserve the balance of talist is upon him, while with the bank no personal rights, to redress wrongs, and pre- such motives operate. It is not easy to vent the commission of crimes. On the shake the credit of a bank, so as to restrain other hand, a more liberal and exalted view its operations, unless its affairs have beof the ends of government, recognises in come so involved that a premonition is lost it a patron of virtue and industry. Hav- upon it. Those operations which endanger ing the promotion of the welfare of society the security of a bank, by directing its as its object, and indeed as the foundation capital to improper uses, are of so secret a of its authority, no expedient ought to nature, that rarely is the condition of a be deemed illegitimate, which tends to failing bank accurately known, until it has produce that result. When the great become insolvent. If to meet this diffipower and influence of government are con- culty a provision of law is adopted, requirsidered, it requires the strongest reasons to ing the capital of the bank to be placed in convince us of the propriety of denying to such a position, that it may be commanded that authority, on any theory, the right to in the event of a failure, and that expediemploy its energies for the encouragement ent is found to be attended with great puband strengthening of industry. Such an lic convenience, who shall say that it is an opinion can only be justified by supposing improper or illegitimate exercise of legislathat governments are not to be relied on as tive authority? Beyond the regulation of having sufficient sympathy with the pur- the rate of interest on money, the law of suits of individuals. However true this competition has so small a restrictive power may be of States, in which the sovereign upon banks as to be unworthy of considerauthority is vested in an individual or body ation. And yet the advocates of nonof men, whose pursuits have nothing in legislation look to it, to correct all the evils common with the pursuits of the body of to which banking gives rise, when it is conthe people, it is not justified by the ex- ducted with disregard to the public interperience of our own government. For est. They would do well to account for whatever errors have been committed in the fact, that hitherto it has become neces
sary to increase the restraints of law in is as responsibly charged with the care of order to protect the public, rather than to those interests, as the state governments throw them off as useless habiliments. It are within their spheres. Both exist to cannot with any propriety be said, that le- promote the same objects, and the differgislation has produced an artificial condi- ence between them is rather a difference tion of banking, which can only be pre- of jurisdiction, than of nature or kind. To served by the constant addition of new hold a contrary doctrine, would cast a susprovisions, for that science has matured it- picion upon the wisdom of our constitution. self under circumstances admitting its In adapting the advantages of the guarhighest adaptation to the wants of man- anty-system to the wants of the nation, as kind; and the only object of legislative we have shown in the article already alinterposition is to circumscribe the ille- luded to, no more is required of the genegitimate operations of banks, while bank- ral government than that it shall adopt a ing is and should be left to the largest convenient mode of managing its own finanliberty consistent with public convenience. cial concerns, without making use of those
It is no less difficult to vindicate the disputed powers under which the creation of propriety of conceding to the federal go- a national bank must take place. And vernment, the right of adopting such a the public advantages to be derived from system of finance as will afford the greatest such a course ought mainly to influence its convenience to the nation. It ought to be adoption. In requiring this it is only aska prominent consideration in the adoption ing of a popular government that its policy of any governmental measure, whether by should originate in the interests of the peoCongress or the State Legislatures, whether ple, and its measures be conformed to their the interests of trade and labor are to be wants, which was the true ideal of the affected beneficially or injuriously by it; framers of the constitution. for the general government within its sphere
A. J. W.
A HISTORY OF PARTIES.
(Continued from page 338.)
A "Peace PARTY” was soon formed, tonians, by Martin Van Buren, and others. composed of an union of Federalists, and a In a caucus of both divisions of the Reportion of the anti-war Democrats, whose publican party, Mr. Van Buren is said to intention it was, to defeat Mr. Madison's have delivered a violent philippic against re-election, or bring out an expression of the South, and the “Old Dominion” parpublic sentiment that would force the ad- ticularly, and to have denounced Madison ministration to a peace. A few, more in- and his whole cabinet, as “unworthy the temperate, openly threatened a dissolution confidence of the people,”—Messrs. Sanof the Union, but these had no weight in ford and Root replying to him. any party, and spoke only for themselves. The re-election of Mr. Madison was efA number of prominent Federalists, deem- fected by 128 electoral votes, to 89 for ing it their duty now to support the ad- Clinton. Gerry having 131 to $6 for Inministration in the war, refused to take gersoll. The opposition gained from the any part in disapprobatory expressions; previous election, New York, New Jersey, among these were Oliver Wolcott and and 3 votes in Maryland—40 votes in all. Samuel Dexter, members of President Their hopes had been high, and the disapAdams' cabinet. The ex-President, him- pointment was bitter. self, had been a warm supporter of the re In the 13th Congress, the division of parpublican administrations, from an early pe- ties was thus : Senate: Administration, 27; riod after Jefferson's accession.
Opposition, 9; House : Administration, The nomination of Madison for re 120; Opposition, 66. Henry Clay was election, by a Congressional caucus of the elected Speaker of the House, by 89 votes, administration party, unanimously made, to 54 for Timothy Pitkin of Connecticut. was at once followed by that of De Witt The State of Massachusetts, as being in Clinton, by the Republican members of the lead of the opposition, had been jealously New York Legislature; an effort to ex watched by the administration party, who tend the disaffection to the party in other expected that whatever measures of reStates was made, but attended with little sistance to the government were adop
A convention of the Federalists ted, would originate there. The domwas held at New York city, in September, inant party in that State, was in the lead in which eleven States were represented of Harrison Grey Otis, Josiah Quincy, by seventy delegates. It was decided by William Prescott, and others, men of dethem to unite with the New York Repub- cided talent, and obnoxious to the Republicans, on Mr. Clinton, as the only chance licans, as ultra in their schemes of opposiof defeating Mr. Madison. Jared Inger- tion. 'A resolution adopted in the State soll, a Federalist, of Pennsylvania was Senate, on motion of Mr. Quincy, declarnominated for Vice President.
ing, in effect, that it was unbecoming a moNotwithstanding the apparent unanimi- ral and religious people, to rejoice over victoty of Mr. Clinton's nomination by the ries not achieved in immediate self-defence, New York Republicans, Mr. Madison had had furnished a theme for denunciation to a party in the Legislature, and the vote of the Republicans of the whole Union, and the State was not given up without an ef- this “unpatriotic sentiment,” they deemed fort. The administration men were head a prelude to worse action. Gov. Strong's ed in the Legislature, by Nathan Sanford, refusal to place the militia under the orErastus Root, and Gen. Haight; the Clin-I ders of the United States' officers, (based
on constitutional grounds) was viewed as and to restrict commerce ; limiting the one step toward a treasonable design, and President to a single term, and providing when the Hartford Convention was against his election from the same State proposed, this was believed to be in- for two successive terms; respecting the tended to consummate the scheme of dis- representation and taxation of slaves. union and a British alliance, or, at least, of These propositions, were rejected by the open resistance to the government. Legislatures of all the States except those
The real occasion of this celebrated of New England. meeting, was the critical condition of the At about the time of the meeting of the New England States. A hostile fleet Convention, the Republican members of hovered near the coast menacing descent, Congress from New England, held a cauand proclaiming that its object was to pillage cus to consider what course it was best to reand destroy the seaports; Provost, at the commend to the President, in relation to the head of 14,000 veterans, was in the state of Convention. A proclamation forbidding Vermont; a part of Massachusetts was in the meeting was suggested, but rejected, possession of the enemy—that State had and no advice could be agreed upon. It expended a million of dollars, in her de- is now known, that the President gave sefence—her treasury was bankrupt, in effect cret orders to the District Attorney of Con-stocks being at a discount of 50 per cent. necticut, to watch the proceedings of the The national government, occupied with Convention, and on the appearance of any the formidable invasions at the South, one overt act of treason, the commander of the of them directed immediately against it- United States' troops in Connecticut was to self, was unable to provide for the exigen- arrest the whole body. If more force than cy at the North. In this state of affairs he had was required, the militia of New an extra session of the Massachusetts Le- York were to be called into requisition. gislature was called, and the meeting of a The war soon concluded. As a measure New England Convention, suggested by of party policy, we believe its effects upon that body, by a party vote 22 to 12, in the the nation to have been good—to have been Senate, 260 to 90 in the House. The ob- worth the price, and more. We believe jects to be considered were the “public the contest was necessary, in this sense, grievances and concerns,” “defence against that although it might have been for a time the enemy,” and if they thought proper, postponed, it could not be permato procure a Convention of all the States, nently avoided, without sinking the nation to revise the consitution so as to secure the into a worse condition than that of colorights of all, “ by placing all upon the ba- nial servitude. It was emphatically, the sis of a fair representation.”
second war of Independence.” Its effect The Convention met at Hartford, Dec. on the condition of parties was adve to 15, 1814, and their debates continued for its supporters. Many of that party had a fortnight, with closed doors and under been disaffected, some irreconcilably divian injunction of secrecy. But the idea ded; an opposition, feeble at the commencethat this injunction was the cover of trea- ment, had been strengthened until it sonable debates, the character of the mem was nearly an overmatch for the adbers entirely forbids; and it is further dis- ministration party. Had the war conproved by the instructions under which the tinued a short time longer, it must have Connecticut delegation went to the Con- ruined its projectors; the splendid vicvention, viz., to deliberate “ on measures tories of the last campaign, indeed, were not inconsistent to the government." The not sufficient to prevent complaints from result of their debates was a paper enumer- all parts of the country of the increasing ating the grievances of the New England weight of their burdens. The administraStates; recommending them to petition tion felt its condition fast growing critical, Congress to be allowed to retain a part of and hailed the treaty as affording escape the taxes levied on them, for self-defence, from an approaching dilemma. and proposing to the people of the United Another effect of the war was the farStates, amendments to the Constitution, ther removal of the Republican party from restricting the power to make war; that to their old opinions of the relative
of admit new States; that to lay embargoes the state and national governments and of