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SENATE.]

Treasury Notes.

(Sept. 18, 1837.

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the imports and exports of the country to the port where community must become one containinated and corrupted such extraordinary facilities were afforded? If such would clearly be the effects in the case supposed, it is equally clear There is another and a final reason which I shall assign that the concentration of the currency at the same point, against the reunion with the banks. We have reached a through the connexion of the Government with the banks, new era with regard to these institutions. He who would would have equal, if not greater, effects; and that, whether judge of the future by the past, in reference to them, will one general bank should be used as an agent, or a league be wholly mistaken. The year 1833 marks the commenceof banks, which should have their centre there. To other ment of this era. That extraordinary man, who had the ports of the country, the trifling advantages which a branch power of imprinting his own feelings on the community, or deposite bank would give, in the safekeeping of the then commenced his hostile attacks, which have left such public revenue, would be as nothing, compared to the effects behind, that the war then commenced against the losses caused to their commerce by centralizing the inoney banks, I clearly see, will not terminate, unless there be a ed action of the country at a remote point. Other gentle separation between them and the Government, until one or men can speak for their own sections; I can speak, with the other triumphs-till the Government becomes the bank, confidence, of that which I have the honor in part to rep or the bank the Government. In resisting their union, I

The entire staple States, I feel a deep conviction, act as the friend of both. I have, as I have said, no unbanks and all, would, in the end, be great gainers by the kind feeling toward the banks. I am neither a bank man, disseverance, whatever might be the temporary inconveni nor an anti-bank 'man. I have had little connexion with

If there be any other section in which the effects them. Many of my best friends, for whom I have the will be different, it would be but to confirm the views which highest esteem, have a deep interest in their prosperity, I have presented.

and, as far as friendship or personal attachment extends, As connected with this, there is a point well deserving my inclination would be strongly in their favor. But I consideration. The union between banks and Government stand up here as the representative of no particular interis not only a main source of that dangerous expansion and I look to the whole, and to the future, as well as the contraction in the banking systein which I have already present; and I shall stcadily pursue that course which, illustrated, but is also one of the principal causes of that under the most enlarged view, I believe to be my duty. powerful and almost irresistible tendency to the increase of | In 1834 I saw the present crisis. I in vain raised a warnbanks, which even its friends sce and deplore. I dwelt on ing voice, and endeavored to avert it. I now see, with this point on a former occasion, (on Mr. WEBSTER's mo- equal certainty, one far more portentous. If this struggle tion to renew the bank charter in 1833,) and will not repeat is to go on--if the banks will insist upon a reunion with what I then said. But, in addition to the causes then enu the Government against the sense of a large and influential merated, there are many others very powerful, and among portion of the community—and, above all, if they should others the one under consideration. They all may be sum succeed in effecting it-a reflux flood will inevitably sweep med up in one general cause. We have made banking too away the whole system. A deep popular excitement is profitable-far, very far, too profitable ; and I may add, too never without some reason, and ought ever to be treated influential. One of the most ample sources of this profit with respect; and it is the part of wisdom to look timely and influence may be traced, as I bave shown, to the con into the cause, and correct it before the excitement shall nexion with the Government; and is, of course, among become so great as to demolish the object, with all its good the prominent causes of the strong and incessant tendency and evil, against which it is directed. of the system to increase, which even its friends see must The only safe course for both Government and banks is finally overwhelm either the banks or the institutions of to remain, as they are, separated-each in the use of their the country,

With a view to check its growth, they have own credit, and in the management of their own affairs. proposed to limit the number of banks and the amount of The less the control and the influence of the one over the banking capital by an annendment of the constitution; othor, the better. Confined to their legitimate sphere—that but it is obvious that the effects of such an amendment, if of affording temporary credit to commercial and business it were practicable, would but increase the profits and in- men-bank-notes would furnish a safe and convenient cirfluence of bank capital; and that, finally, it would justly culation in the range of the circle of commerce and busiproduce such indignation on the part of the rest of the ness within which the banks may be respectively situated, community against such unequal advantages, that in the exempt almost entirely from those fluctuations and convulend, after a long and violent struggle, the overthrow of sions to which they are now so exposed; or, if they should the entire system would follow. To obviate this difficulty, occasionally be subject to them, the evil would be local and it has been proposed to add a limitation upon the amount temporary, leaving undisturbed the action of the Governof their business; the effects of which would be, the ac ment and the general currency of the country, on the staconmodation of favorites, to the exclusion of the rest of | bility of which the prosperity and safety of the community the community, which would be no less fatal to the sys so much depend. tem. There can be, in fact, but one safe and consistent I have now stated my objections to the rennion of the remedy-the rendering banking as a business less profitable Government and the banks. If they are well founded ; if and influential; and the first and decisive step toward this the State banks are of themselves incompetent agents; if a is a disseverance between the banks and the Government. Bank of the United States be impracticable, or, if practiTo this may be added some effectual limitation on the de-cable, would, at this time, be the destruction of a large pornomination of the notes to be issued, which would operate tion of the existing banks, and of renewed and severe pecuin a similar manner.

niary distress; if it would be against the settled conviction I pass over other and important objections to the connex of an old and powerful party, whose opposition time canion-the corrupting influence and the spirit of speculation not abate; if the union of Government and banks add to which it spreads far and wide over the land. Who has the unfitness of their notes for circulation, and be unjust not seen and deplored the vast and corrupting influence and unequal between citizen and citizen, and one portion brought to bear upon the Legislatures to obtain charters of the Union and another; and, finally, if it would excite and means necessary to participate in the profits of the in an implacable and obstinate war, which could only termistitutions ? This gives a control to the Goveryment which nate in the overthrow of the banking system or the institugrants such favors, of a most extensive and pernicious tions of the country, it then remains that the only alternacharacter; all of which must continue to spread and in- tive would be permanently lo separate the two, and to crease, if the connexion should continue, until the whole 'reorganize the Treasury so as to enable it to perform those

Sept. 18, i837.]

Treasury Notes.

(SENATE.

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duties which have heretofore been performed by the banks some stable and safe medium of circulation, to take the place as its fiscal agents. This proposed reorganization has been of bank-notes in the fiscal operations of the Government, called a sub-treasury—an unfortunate word, calculated to ought to be issued. I intend to propose nothing. It would mislead and conjure up difficulties and dangers that do not be impossible, with so great a weight of opposition, to pass really exist. So far from an experiment, or some new de- any measure without the entire support of the administravice, it is only returning to the old mode of collecting and tion; and, if it were possible, it ought not to be attempted disbursing public money, which, for thousands of years, where so much must depend on the mode of execution. has been the practice of all enlightened people till within | The best measure that could be devised might fail, and imthe last century.

poso a heavy responsibility on its author, unless it met with In what manner it is intended to reorganize the Treasury, the hearty approbation of those who are to execute it. I, by the bill reported, I do not know. I have been too much then, intend merely to throw out suggestions, in order to engaged to read it; and I can only say that, for one, I shall excite the reflection of others on a subject so delicate, and assent to no arrangement which provides for a Treasury of so much importance : acting on the principle that it is bank, or that can be perverted into one. If there can be the duty of all, in so great a juncture, to present their views any scheme more fatal than a reunion with the banks at without reserve. this time, it would be such a project. Nor will I give my It is, then, my impression, that, in the present condition assent to any arrangement which shall add the least un of the world, a paper currency, in some form, if not necesnecessary patronage. I am the sworn foe to patronage, sary, is almost indispensable in financial and commercial and have done as much and suffered as much in resisting operations of civilized and extensive communities. In many it as any one. Too many years have passed over me to respects it has a vast superiority over a metallic currency, change, at this late day, my course or principles. But I especially in great and extended transactions, by its greater will say, that it is impossible so to organize the Treasury cheapness, lightness, and the facility of determining the for the performance of its own functions as to give to the

The great desideratum is, to ascertain what deExecutive a tenth part of the patronage it will lose by the scription of paper has the requisite qualities of being free proposed separation, which, when the bill for the reorgan- from fluctuation in value, and liability to abuse, in the ization comes up, I may have an opportunity to show. I greatest perfection. I have shown, I trust, that the bankhave ventured this assertion after much reflection, and with notes do not possess these requisites in a degree sufficiently entire confidence in its correctness.

high for this purpose. I ge farther. It appears to me, after But something more must be done besides the reorgan- bestowing the best reflection I can give the subject, that no ization of the Treasury. Under the resolution of 1816, convertible paper—that is, no paper whuse credit rests upon bank-notes would again be received in the dues of the a promise to pay-is suitable for currency. It is the form Government, if the banks should resume specie payments. of credit proper in private transactions between man and The legal as well as the actual connexion must be severed. man, but not for a standard of value, to perform exchanges Bat I am opposed to all harsh or precipitate measures. No generally, which constitute the appropriate functions of great process can be effected without a shock, but through money or currency. The measures of safety in the two the agency of time. I accordingly propose to allow time cases are wholly different. A promissory note, or confor the final separation ; and, with this view, I have drawn vertible paper, is considered safe so long as the drawer has up an amendment to this bill, which I shall offer at the ample means to meet his engagements; and, in passing proper time, to modify the resolution of 1816, by providing from hand to hand, regard is had only to his ability and ihat after the 1st of January next, three-fourths of all sums willingness to pay. Very different is the case in currency. due to the Government may be received in the notes of The aggregate value of the currency of a country necesspecie-paying banks; and after the 1st of January next fol- sarily bears a small proportion to the aggregate value of its lowing, one-half; and after the 1st of January next subse- property. This proportion is not well ascertained, and is quent, one-fourth; and after the 1st of January thereafter, probably subject to considerable variation

different counnothing but the legal currency of the United States, or tries, and at different periods in the same country. It may bills, noles, or paper issued under their authority, and be assumed, conjecturally, in order to illustrate what I say, which may by law be authorized to be received in their at one to thirty. Assuming this proportion to be correct, Jues. If the time is not thought to be ample, I am per. (which probably is not far from the truth,) it follows that, fectly disposed to extend it. The period is of little impor- in a sound condition of the country, where the currency is tanee in my eyes, so that the object be effected.

metallic, the aggregate value of the coin is not more than In addition to this, it scems to me that some measure, of one in thirty of the aggregate value of the property. It a remedial character, connected with the currency, ought also follows, that an increase in the amount of the currento be adopted, to ease of the pressure while the process is cy, by the addition of a paper circulation of no intrinsic going through. It is desirable that the Government should value, but increases the nominal value of the aggregate make as few and small demands on the specie market as property of the country in the same proportion that the inpossible during the time, so as to throw no impediment in crease bears to the whole amount of currency; so that, if the way of the resumption of specie payments. With this the currency be doubled, the nominal value of the property view, I am of the impression that the sum necessary for will also be doubled. Hence it is, that, when the paper the present wants of the Treasury should be raised by a currency of a country is in the shape of promissory notes, paper, which should at the same time have the requisite there is a constant tendency to excess. We look for their qualities to enable it to perform the functions of a paper safety to the ability of the drawer; and so long as his means circulation. Under this impression, I object to the interest are ample to meet his engagements, there is no distrust; to be allowed on the Treasury notes which this bill author- without reflecting that, considered as currency, it cannot izes to be issued, on the very opposite grounds that the Sen- safely exceed one in thirty in value, compared to property. ator from Massachusetts bestows his opposition. He ap- And the delusion is farther increased by the constant inproves of interest, because it would throw them out of cir crease in value of property, with the increase of the notes culation into the hands of capitalists, as a convenient and in circulation, so as to maintain the same relative proporsafe investment; and I disapprove, because it will have that tion. It follows that a Government may safely contract a effect. I am disposed to ease off the process; he, I would debt many times the amount of its aggregate circulation; suppose, is very little solicitous on that point.

but, if it were to attempt to put its promissory notes in cirBut I go farther. I am of the impression, to make this culation in amount equal to its debts, an explosion in the greal measure successful, and secure it against reaction, that I currency would be inevitable. And hence, with other causes,

Senate.)

Treasury Notes.

[Sept. 18, 1837.

the constant tendency to an excessive issue of bank-notes commerce. An unusual demand from abroad for the metin prosperous times, when so large a portion of the com als would, of course, raise them a little in their relative valmunity are anxious to obtain accommodation, and who are ue, and depress relatively the Government bills in the same disappointed when negotiable paper is refused by the banks; proportion, which would cause them to flow into the Treasnot reflecting that it would not be safe to discount beyond ury, and gold and silver to flow out; while, on the contrary, the limits I have assigned for a safe circulation, however an increased demand for the bills in the domestic exchange good the paper offered.

would have the reverse effect, causing, as I have stated, an On what, then, ought a paper currency to rest ? I would alternate flux and reflux into the Treasury, between the say on demand and supply simply, which regulates the val- two, which would at all times keep their relative values ue of every thing else--the constant demand which the Gov- either at or near par. ernment has on the community for its necessary supplies. No one can doubt that the fact of the Government reA medium resting on this demand, which simply obligates ceiving and paying away bank-notes in all its fiscal transthe Government to receive it in all of its dues, to the ex actions is one of the principal sources of their great circulaclusion of every thing else except gold and silver, and which tion; and it was mainly on that account that the notes of shall be optional with those who have demands on Govern- the late Bank of the United States so freely circulated all ment to receive or not, would, it seems to me, be as stable over the Union. I would ask, then, why should the Gorin its value as those metals themselves, and be as little lia ernment mingle its credit with that of private corporations? ble to abuse as the power of coining. It would contain No one can doubt but that the Government credit is betwithin itself a self-regulating power. It could only be is ter than that of any bank-more stable and more safe. sued to those who had claims on the Government, and to Why, then, should it mix it up with the less perfect credit those only with their consent, and, of course, only at or of those institutions? Why not use its own credit to the above par with gold and silver, which would be its habitual amount of its own transactions? Why should it not be state; for, as far as the Government was concerned, it would safe in its own hands, while it shall be considered safe in be equal in every respect to gold and silver, and superior the hands of 800 private institutions scattered all over the in many, particularly in regulating the distant exchanges country, and which have no other object but their own priof the country. Should, however, a demand for gold and vate profits, to increase which they almost constantly extend silver from abroad, or other accidental causes, depress it their business to the most dangerous extremes! And why temporarily, as compared with the precious metals, it would should the community he compelled to give six per cent. then return to the Treasury; and, as it could not be paid out discount for the Government credit blended with that of during such depression, its gradual diminution in the mar the banks, when the superior credit of the Government ket would soon restore it to an equality, when it would could be furnished separately, without discount, to the muagain flow out into the general circulation. Thus there tual advantage of the Government and the community? would be a constant alternate flux and reflux into and from Why, let me ask, should the Government be exposed to such the Treasury, between it and the precious metals; but, if difficulties as the present, by mingling its credit with the at any time a permanent depression in its value be possible banks, when it could be exempt from all such, by using by from any cause, the only effect would be to operate as a re itself its own safer credit? It is time the community, which duction of taxes on the community, and the only sufferer has so deep an interest in a sound and cheap currency, and would be the Government itself. Against this its own in the equality of the laws between one portion of the citizens terest would be a sufficient guaranty.

of the country and another, should reflect seriously on these Nothing but experience can determine what amount and things—not for the purpose of oppressing any interest, of what denominations might be safely issued; but it may but to correct gradual disorders of a dangerous character, be safely assumed that the country would absorb an amount which have insensibly, in the long course of years, without greatly exceeding its annual incoine. Much of its exchan- being perceived by any one, crept into the state. ges, which amount to a vast sum, as well as its banking bus The question is, not between credit and no credit, as iness, would revolve about it, and many millions would some would have us believe; but in what form credit can thus be kept in circulation beyond the demands of the Gov- best perform the functions of a sound and safe currency. ernment. It may throw some light on the subject to state On this important point I have freely thrown out my ideas, that North Carolina, just after the Revolution, issued a large leaving it to this body and the public to determine what amount of paper, which was made receivable in dues to her. they are worth. Believing that there might be a sound and It was also made a legal tender, but which, of course, was safe paper currency founded on the credit of Governnot obligatory after the adoption of the federal constitu ment exclusively, I was desirous that those who are retion. A large amount-say between four and five hundred sponsible and have the power should have availed themthousand dollars-remained in circulation after that period, selves of the opportunity of a temporary deficit of the and continued to circulate for more than twenty years, at Treasury, and the postponement of the fourth instalment par with gold and silver during the whole time, with no intended to be deposited with the States, to use them as the other advantage than being received in the revenue of the means of affording a circulation for the present relief of the State, which was much less than $100,000 per annum. I country and the banks, during the process of separating speak on the information of citizens of that State, on whom them from the Government; and, if experience should justify I can rely.

it, of furnishing a permanent and safe circulation, which But, whatever may be the amount that can be circulated, would greatly facilitate the operations of the Treasury, and I hold it clear that, to that amount, it would be as stable in afford, incidentally, much facility to the commercial operavalue as gold and silver itself, provided the Government be tions of the country. But a different direction was given; bound to receive it exclusively with those metals in all its and when the alternative was presented, of a loan, or the dues, and that it be left perfectly optional with th:se who withholding the fourth instalment from the States, I did have claims on the Government to receive it or not. It not hesitate to give a decided vote for withholding it. My will also be a necessary condition that notes of too small a aversion to a public debt is deep and durable. It is, in my denomination should not be issued, so that the 'Treasury opinion, pernicious, and is little short of a fraud on the shall have ample means to meet all demands, either in gold public. I saw too much of it during the late war not to or silver, or the bills of the Government, at the option of understand something of the nature and character of pubthose who have claims on it. With these conditions, no lic loans. Never was a country more egregiously imfurther variation could take place between it and gold and posed-on. silver than that which would be caused by the action of Having now presented my views of the course and the

SEPT. 18, i837.)

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BENATE.

We are

measures which the permanent policy of the country, look

than it ever has been since its commencement. ing to its liberty and lasting prosperity, requires, I come

about to take a fresh start. I move off under the Statefinally to the question of relief. 'I have placed this last--not rights banner, and go in the direction in which I have been that I am devoid of sympathy for the country in the pecu so long moving. I seize the opportunity thoroughly to reniary distress which now pervades it. No one struggled form the Government; to bring it back io its original priuearlier or longer to prevent it than myself; nor can any one ciples; to retrench and economize, and rigidly to enforce mure sensibly feel the widespread blight which has sud-accountability. I shall oppose strenuously all attempts to denly blasted the hopes of so many, and precipitated thou- originate a new debt; to create a national bank; tu reunite sands from affluence to poverty. The desolation has fallen the political and money power--more dangerous than that mainly on the mercantile class-a class which I have ever of church and state-in any form or shape ; to prevent the held in the highest estimation. No country ever had a su disturbances of the compromise, which is gradually reinovperior body of merchants-of higher honor, of more daring ing the last vestige of the tariff'system; and, mainly, I shall enterprise, or of greater skill and energy. The ruin of use my besi efforts to give an ascendency to the great consuch a class is a heavy calamily, and I am solicitous, among servative principle of State sovereignty, over the dangerous other things, to give such stability to our currency as to

and despotic doctrine of consolidation. I rejoice to think prevent the recurrence of a similar calamity hereafter. But that the Executive department of the Government is now so it was first necessary, in the order of things, that we should reduced in power and means, that it can no longer rely on determine what sound policy, looking to the future, de- its influence and patronage to secure a majority. Hencemands to be done at the present juncture, before we con forward it can have no hope of supporting itself but on sider the question of relief, which, as urgent as it inay be, wisdom, moderation, patriotism, and devoted attachment is subordinate, and must yield to the former. The patient to the constitution, which I trust will make it, in its own lies under a dangerous disease, with a burning thirst and defence, an ally in effecting the reforin which I deem inother symploms, which distress him more than the vital dispensable to the salvation of the country and its instituorgans which are attacked. The skilful physician first tions. makes himself master of the nature of the disease, and I look, sir, with pride to the wise and noble bearing of then determines on the treatment necessary for the restor the little State-rights party, of which it is my pride to be a ation of health. This done, he next alleviates the distress- member, throughout the eventful period through which the ing symptoins as far as is consistent with the restoration of country has passed since 1824. Experience already bears health, and no furtlier. Such shall be my course.

As testimony to their patriotism, firmness, and sagacity; and far as I possibly can, consistently with the views I en history will do it justice. In that year, as I have stated, tertain, and what I believe to be necessary to restore the

the tariff system triuinphed in the councils of the nation. body politic to health, I will do every thing in my power pluses and the extravagances to which it would lead. We

We saw its disastrous political bearings; foresaw its surto mitigate the present distress. Further I cannot go. After the best reflection, I am of the impression that the

rallied on the election of the late President to arrest it, Goverinent can do but liúle in the way of relief, and that through the influence of the Executive department of the it is a case which must be mainly left to the constitution Government. In this we failed. We then fell back upon of the patient, who, thank God, is young, vigorous, and

the rights and sovereignty of the States, and by the action robust, with a constitution sufficient to sustain and over

of a small but gallant State, and through the potency of its come the severest attack. I dread the doctor and his drugs interposition, we brought the system to the ground, sustained much more than the disease itself. The distress of the as it was by the opposition and the administration, and by country consists in its indebtedness, and can only be re the whole power and patronage of the Government.

The lieved by the payment of its debts. To effect this, indus- pernicious overtlow of the Treasury, of which it was try, frugality, economy, and time, are necessary. I rely the parent, could not be arrested at once.

The surplus more on the growing crop-on the cotton, rice, and tobacco,

was seized on by the Executive, and, by its control over the of the South-than on all the projects or devices of poli banks, became the fruitful source of Executive influence ticians. I am utterly opposed to all coercion by this Gov.

and encroachment. Without hesitation, we joined our old ernment. But Government may do something to relieve opponents on the tarifl

' question, but under our own flag, the distress. It is out of debt, and is one of the principal and without merging in their ranks, and made a gallant and creditors both of the banks and of the merchants, and should successful war against the encroachments of the Executive. set an example of liberal indulgence. This I am wiliing That terminated, we part with our late allies in peace; and to give freely. I am also prepared to vote freely the use move forward, lag, or onward who inay, to secure the fruits of Governmant credit in some safe form, to supply any de

of our long but successful struggle, under the old republican ficit in the circulation during the process of recovery, as

Aag of 1798, which, though tattered and torn, has never far as its financial wants will permit. I see not what more

yet been lowered, and, with the blessing of God, never can be safely done. But my vision may be obtuse upon

shall be with my consent. this subject. Those who differ fronu me, and who profess

On concluding his speech, Mr. C. submitted bis amicudso much sympathy for the public, seem to tbink that much ment, which provided that from and after the 1st of relief inay be afforded. I hope they will present their January next, three-fourths of the money due to the Gove views. I am anxious to hear their prescriptions; and I as ernment may be paid in nutes of specie-paying banks; that sure them that whatever they may propose, if it shall from and after the lst of January 1839, one-half might be promise relief, and be not inconsistent with the course paid in such notes; one-quarter after the 1st of January, which I deem absolutely necessary for the restoration of the 1840; and that, from and after the 1st of January 1841, all country to perfect health, shall cheerfully receive my sup

sums due the Government for customs, lands, &c. shall be port. They may be more keen-sighted than I am as to the paid only in the legal currency of the United States, or in best means of relicf, but cannot have a stronger disposition such noies, bills, &c., as should by law be ordered. to afford it.

Mr. WEBSTER rose, and inquired of Mr. C. to what We have, Mr. President, arrived at a remarkable era in bill it was proposed to make this an amendment. our political history. The days of legislative and execu

Mr.CALHOUN replied, to one called the divorce bill lietive encroachments, of tariffs and surpluses, of bank and

tween the Government and the banks, which he said was public debt, and extravagant expenditure, are past for just ahead. the present. The Government stands in a position disen Mr. BENTON, after expressing his entire concurrence tangled from the past, and freer to choose its future course

in the amendincut of Mr. Calhoun, sent to the Chair two VOL. XIV.-5

SENATE.]

Treasury Notes.

(Sept. 18, 1837.

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amendments of his own, which he said comprised the sub-nation than one hundred dollars; are to be cancelled when stance of the bill introduced by him two years ago, taken up; and that the Secretary of the Treasury is ex. re-establish the constitutional currency of the country.” pressly authorized to raise money upon them by loaning His first amendment provides that, after a day to be speci- them. fied, all the public dues should be paid in gold and silver These are the features and qualities of the notes to be only, and in Treasury notes and land scrip, as might by issued, and they define and fix their character as notes to law be authorized; and the second provides that, after the raise loans, and to be laid by as investinents, and not as resumption of specie payments by the banks, the Treasury notes for currency, to be pushed into circulation by the should begin with specie payments.

power of the Government, and to add to the curse of the [These amendments, together with Mr. Calhoun's, were day by increasing the quantity of unconvertible paper ordered to be printed.]

money. Mr. B. said he should not have risen in this debate, The execution of the act, and especially the cardinal had it not been for the misapprehensions which seemed feature of the quantum of interest, is left to the President to pervade the minds of some Senators as to the character and the Secretary of the Treasury. I presume it will be of the bill. It is called by some a paper-money bill, and executed as a law to borrow money ; and in that point of by others a bill to germinate a new national debt. These view the interest was left open, under a maximum limit, are serious imputations, and require to be answered, not by as is proper to be done in all propositions for loans. Bids declaniation and recrimination, but by facts and reasons, may be invited by advertisement; the competition of lenders addressed the candor and to the intelligence of an en may fix the interest; capitalists may fix it by competition, lightened and patriutic community.

though nominally left to the discretion of the President and I dissent from the imputations on the character of the Secretary; and at whatever rate it is thus lixed-at whatbill. I maintain that it is neither a paper-money bill, nor ever rate a loan of gold and silver is commanded at that a bill to lay the foundation for a new national debt; and rate the whole issue, made at any one time, ought to go. will briefly give my reasons for believing as I do on both There should r.ot be two rates of interest—a high one for points.

the independent and opulent capitalist, and a low one for There are certainly two classes of Treasury notes--one the helpless and necessitous public creditor. for investment, and one for circulation; and both classes This is my opinion of the character of these Treasury are known to our laws, and possess distinctive features, notes, and of the mode of using them. I cannot doubt but which define their respective characters, and confine them that lenders will present themselves, and that the whole ten to their respective uses.

millions may be borrowed in gold and silver just as fast as The notes for investment bear an interest sufficient to the Government needs it. That opinion is formed upon induce capitalists to exchange gold and silver for them, data-upon the great amount of specie now in the counand to lay them by as a productive fund. This is their try, its unproductiveness to its present holders, and the distinctive feature, but not the only one; they possess other facility with which large amounts of specie were borrowed subsidiary qualities, such as transferability only by en- immediately after the bank suspensions and the commerdorsement-payable at a fixed time-not re-issuable-nor cial revulsions of 1819. The specie in the United States of small denomination-and to be cancelled when paid. cannot now be less than it was six months ago, to wit, Notes of this class are, in fact, loan notes-notes to raise eighty millions of dollars; for it is shown by the customloans on, by selling them for hard money-either immedi house reports, and other data, that, notwithstanding the ately by the Secretary of the Treasury, or, secondarily, hy efforts to ship it to Europe, the imports and exports are the creditor of the Government to whom they have been about even during that time; and that, taking the whole paid. In a word, they possess all the qualities which invite fiscal year together, the imports now exceed the exports by investment, and forbid and impede circulation. The act nearly four millions of dollars; and that near $900,000 in of 1812 authorized an issue of notes of this description. gold have been coined in the first three quarters of the They bore tive and two-fifths per cent. interest, with an present calendar year. The specie in the country cannot, express clause that the Secretary of the 'Treasury might therefore, be less than $80,000,000, and, upon the calcuraise money upon them by loan. I presume there are Sen lation of last year, is more. The whole of this vast amount ators present who were members of the House of Repre- is lying idle, barren, and unproductive to its owners-not sentatives in 1812, who gave the sanction of their appro that they are all unwilling to lend it, and to receive interest, bation to the Treasury note law of that year, and who but for want of borrowers in whom they have confidence. would be very unwilling to hear the epithets applied to that The United States will present that borrower, and will law which are lavished upon this bill, which is copied bring forth the hoarded treasures which the lack of generfrom it.

al confidence now consigns to sterility in private chests The Treasury notes for currency are distinguished by and in special bank deposites. Thus it was in 1819-20. features and qualities the reverse of those which have been The commercial and bank catastrophe of that period took mentioned. They bear litile or no interest. They are place in 1819; in less than a year afterwards, from the payable to bearer-transferable by delivery--re-issuable--of collapse of business and the stagnation of commerce, low denominations—and frequently reimburseable at the money in the Atlantic cities was abundant, idle, and seekpleasure of the Government. They are, in fact, paper ing investment at four or five per cent. So says Mr. money, and possess all the qualities which forbid invest- Cheves—so we can all remember. But to refresh memories, ment, and invite to circulation. The Treasury notes of and establish this important fact, I will read a paragraph 1815, were of that character, except for the optional clause from Mr. Cheves's late letter to Dr. Cooper: to enable the holder to fund them at the interest which “ Before the close of the first year of my administration, commanded loans-at seven per cent.

adequate capital had been assigned to the offices in which These are the distinctive features of the two classes of it had been deficient, and the bank and its offices general

Now try the committee's bill by the test of these ly, then or very soon after, were in a condition to do exqualities. It will be found that the notes which it author tensive business, had the situation of the country permitizes belong to the first named class; that they are to bear ted it. But the commerce of the country became perfectly an interest, which may be six per cent.; that they are trans stagnant. Money was a drug. The bank, to keep up its ferable only by endorsement; that they are not re-issu business as far as possible, discounted long paper--say at able; that they are to be paid at a day certain, to wit, with four and six months, and perhaps longer. It was even in one year; that they are not to be issued of less denomi proposed, with the same object, to lower the rate of interest

notes.

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