25th CONG.....1st SESS. Where is the warning they gave? Where is the measure they took for safery? If they did for see it, and, foreseeing it, gave no alarm, took no masures of salety, they are-kraves! They are, undoubtedly, both kaves and fools! But the Experiment has failed. Why? is the next question. Sir, why should this experiment have failed? It was wholly and solely in the control of the Executive. If it has failed, the Executive wholly and solely is to blame. They can offer no excuse; they have no pretext that their favorite bant ing has expired under the unkind nursing of its enemies. The Admin istration assumed the entire responsibility, took upon ftɛelf the sole care, and wielded the whole power of originating, matur ing, regulating, and carrying out its own experiment. No mi nority can be blamed. We were in a minority, and too weak even to throw a stumbling-block in the way of its success; all that we could do was to predict its failure, and wofully has the prediction been fulfilled! The President alone removed the deposites; he placed them wherever he pleased, on his own terms, and under his owo rules. For more than three years did the public money remain in the custody and control of the Executive hand without authority of or regulation by law. Congress was so yielding and obedient that it left its legitimate powers derelict to Executive a sumption. The President, without restraint or limit, ordered the receipts, safe-keeping. and disbursements of the public funds at will; he took upon himself to organize a confederation of local banks, obliged his pets to raise the minimum denomination of their notes, endea vored to force them to constitute among themselves a system of internal exchange, backed them with Government credit to accommodate trade, regula ed their receipts of local bank paper; he issued the Treasury circular to remove the specie basis of circulation; in short, was master of his own system. Why did it fail? Sir, there is one remarkable fact in the history of this failure, which should not escape our attention, and which should be eg. pecially noted for our warning and our instruction. The der osite act was passed by Congress in June, 1836, and the very first report of the Secretary of the Treasury thereafter for the first time gave notice of difficulties in our finances. From the removal in 1833 up to that time, the time when Congress had again asserted its power to regulate and control the deposite and safe-keeping of the public money, the note of the night watch was, all is wel!! the system works well, efficiently and safely, even more so than did the Bank of the United States. But the moment that Congress again assumed its powers, the note was changed, though darkly and dubiously. No one would have apprehended, or did apprehend, certain passages of the Secreta. ry's report, in December. 1836, as they must be understood now. The report of Mr. Woodbury, December, 1836, says: "The money in the Treasury has been safely kept during the year 1836. Until July last, as during the two previous years, it was placed in the State banks, selected according to the discretion of this Department, on account of their high standing and favorable position for fiscal purposes and regulated in a manner considered most secure to the Treasury and conve nient to the community, as well as useful to all concerned. It is a source of high gratification to be able to add, that, while so selected and employed, not a single dollar was lost," &c. "Nor is it believed that the domestic exchanges of the country were ever lower or more regular than during that period," &c. "But since the passage of the act of Congress, of June 23d, 1836, 'to regulate the deposites of the public money,' most of the discretionary power before exercised by this Department on this subject, under previous laws and long usages, has been considered as no longer possessed; and various solicitations to use it, though some of them were in cases of extreme hardship, could not, therefore, be complied with. Relieved from great responsibility, and in many cases from much delicacy, in the exercise of ', by the passage of that act, a new system, in conformity with its provisions, and in place of the former one, was at once commenced by this Department, and has since been pursued with all the strictness and regularity which the nature of business, so extensive and complicated, would permit," &c. How did the law create any embarrassment to the Secretary? there was a majority in both Houses of Congress; the Senate had been prostrated by the expunging blow to make it pliant to the wishes of the Executive in the framing of this law as well as others; and the law of June, 1836, did no more than sanction the then existing state of finance, except to deposite the surplus with the States. Sir, the complaint, in plain English, was, that Congress was an incubus upon the Executive will. Moreover, an excuse was wanting for foreseen disasters; here is proof, plain and positive, that the Secretary knew that the deposites were not to be safely kept for the year 1837! The law should not be the scape-goat. The Secretary was put under the law, but the law put every thing under him. The Administration carried out its experiment in its own way, had all the precautionary means of safety, and every opportunity of foreseeing embarrassments in its own power, and yet the pet banks were the first to suspend specie payments! The first bank selected after the passage of the act of June, 1836, was the first to fail with more than a million of Government deposites on handthe Agricultural bank of Mississippi protested a Government draft of $130 000. The second was the Planters' Bank of Migsissippi: the third was a Government bank in New York: the fourth also. In Philadelphia, the pets were the first to fail, and they were the first also in Virginia. The States favorable to the Administration were the first and only States to legalize the suspension of specie payments, and to sanction by law an irredeemable paper currency. Alabama was the first State, and New York, Connecticut, Virginia. Michigan, Illinois, and Mississippi, followed suit. Such, sir, was the end of "the better currency," the swarm of yellow jackets, the flow of humbug metallic currency, in suspension of specie payments, and in the inability of the Government to pay its just d bts, in less than four years from the day the Experiment began! [Here Mr. CLAIBORNE, of Mississippi, interposed with these remarks: Mr. C. said, with the permission of the gentleman from Vir ginia, he would set him right as to an error into which he had no doubt been led by the current reports and newspapers of the day. No stay laws had been passed by the Legislature of Mis sissippi, nor had that body, by any act, smctioned the suspen sion of specie payments by the banks. The legislature was in special session when the suspension took place, but, so far as Mr. C. was informed, it expressed no opinion on the subject. Great distress and embarrasinent prevailed in Mississippi; at that period, particularly, when the first shock was felt; proper ty suddenly depreciated to less than half the value at which it had been quoted; but this distress and depreci tion had been greatly exaggerated abroad, and every press at the North seem Making public officers depositories—Mr. Wise. ed to take it for granted that relief laws would be passed. No This question it, brings us to the causes assigned by the "It was hardly to be expected that those who disapproved of No, sir, party itself, with all its blindness of partiality, preju. "However unwilling any of our citizens may heretofore "At the commencement of the year 1834, the banking capi. Thus was the banking capital, in two years, increased more than 51 millions, paper circulation more than 45 millions, Joans and discounts more than 133 millions!-according to the President's statement of the effect of destroying the only safety. valve we had to secure us from this fearful over-action. This summary of the President does not vary essentially from others which have seen. In the National Gazette of April 8, 1837, you will find the 20 No. of the essays, under the signature of An Examiner: numbers which I fail not to quote, because they are truly able and philosophical commentaries upon the political economy of the times. There it is stated that Gen. Jackson's war against the Bank of the United States, and his removal of the deposites, had, in the seven years which elapsed between the 1st of January, 1530, and the 1st of January, 1837, produced the following results: H. of Reps. 1st. An augmentation in the number of banks from 320 to 677--an increase of 357, besides 146 branches. zd. An augmentation in banking capital of the United States from $145,192,263 to 3:4,240,292-an increase of 179 millions of dollars. 3d. An expansion in the circulation of bank notes from $61,323,898 to $155,762,506-an increase of paper money of upwards of 121 millions of dollars. 4th. An augmentation of amount of deposites, public and private, from $51,559,9.8 to $14,541,891-an i crease of near 91 millions of dollars. 5th An extension of the amount of bank loans and discounts from $00,451,214 to $590,802 661-an increase of upwards of 390 millions of dollars; a sum only 12 millions less than the aggregate of the increased capitals, circulation and deposites. To test the question, whether the Bank of the United States tended to prevent an increase of banking capital, you have only to compare the increase of backing capital in the periods when the bank did not exist with the periods during which it did exist. "The aggregate capital of the banks in the United States was In 1811 1815 1816 1820 1830 1835' $52,000,0^0 82.200,000 89 800,000 102,100,000 1'0,200 000 196,250,000 291,250,000 1836, (to the month of August,) "Thus, in ten years, from 1820 to 1830, the increase of bank capital in the United States was only eight millions of dollars; whereas, in the six following years-no: not six. but only five and a half-the increase amounted to the prodigious sum of one hundred and eighty-one millions!" Sir, this very increase of hanking capital, issues, loans, and discounts, of which the President now complains so much, was caused by the Government"-the Executive itself, in warring upon and destroying the United States Bank; and was encouTage by the Executive in stimulating the local banks with the public deposites. It was a part of the Experiment itself to increase the local bank capital in order to supply the vacuum produced by the fall of the United States Bank. As soon as that institution expired, competition in banking at once commenced. The question among the States was, who shall now furnish the circulating medium? And the question among the banks was, who shall acquire the Government patronage? It had been urged vehemently, by the friends of the United States Bank, that if the Government destroyed that institution it would destroy the circulating medium, currency, and exchange. Every effort was made by the Government to meet and answer that objection, by stimulating its pet banks with Government credit to perform all the functions and offices, commercial and financial, of the United States Bank. In proof of this, sir. Ladduce the numerous and various circulars issued by the Treasury Department from 1833 up to the moment when the bubble bursted in the spring of 1857." [Here Mr. Wise read the two circulars-of July 7th, 1531, and of February 224, 1836.] The deposite banks were expressly told that while they had the "use, without interest, of unusually large sums of the public money, they should take some further temporary sacrifices to obtain and circulate gold, and in other respects to enlarge the specie basis of our circulating medium;" and all this was with the view of the Department to improve the currency! The banks were appealed to to establish a credit, mutual, if they chose, to redeem and reissue a certain amount of each other's. bills, as they might be needed for circulation in travelling and the transmission of funds at a distance. They were regularly notified, through their agent, Whitney, how long Government deposites might remain in their vaults for them to trade, issue, Joan, and discount upen. Str. Ladduce, as further and conclusive evidence, this message itself. See page 11. "The use by the bonks, for their own benefit, of the money deposited with them, has received the sanction of the Govern ment from the commencement of this connection. The money received from the people, instead of being kept till it is needed for their use, is, in consequence of this authority,a fund on which discounts are made for the profit of those who happen to be owners of stock in the banks selected as depositories. The supposed. and often exaggerated, advantages of such a boon will always cause it to be sought fer with avidity. I will not stop to consider on whom the vatronage incident to it is to be conferred; whether the selection and control be trusted to Congress or to the Executive, either will be subjected to appeals made in every form which the sagacity of interest can suggest. The banks, under such a system, are stimulated to make the most of their fortunate acquisition; the deposites are treated as an increase of capital; loans and circulation are rashly aug. mented; and, when the public exigencies require a return, it is attended with embarrassments not provided for nor foreseen. Thus, banks that thought themselves most fortunate when the public funds were received, find themselves most embarrassed when the season of payinent suddenly arrives. "Unfortunately, too, the evils of the system are not Emited to the banks. It stimulates a general rashness of enterprise, and aggravates the fluctuations of commerce and the currency. This result was strikingly exhibited during the operations of the late deposite system, and especially in the purchases of pubJie lands. The order which ultimately directed the payment of gold and silver in such purchases, greatly checked, but could not altogether prevent, the evil. Sperie was, indeed, more dif ficult to be procured than the notes which the banks could themselves create at pleasure; but still. being obtained from them as a loan, and returned as a deposite, which they were again at liberty to use, it only passed round the circle with diminished speed. This operation could not have been perform ed. had the funds of the Government gone into the Treasury to be regularly disbursed, and not loaned out for their own profit, while they were permitted to substitute for it a credit in ac count." In page 12 he further goes on to say: "Since, therefore, experience has shown that to lend the pub lic money to the local banks is hazardous to the operations of the Government, at least of doubtful benefit to the institutions themselves, and productive of disastrous derangement in the business and currency of the country, is it the part of wisdom to renew the connection?" Sir, who gave the use of the public money to the local banks, for their own benefit? Who made the money received from the people a fund on which discounts were made for the profits of those who happened to be owners of stock in the banks selected as depositories? Who caused this boon to be sought for with avidity? Who stimulated the banks to make 25th CONG......1st SESS. the most of their fortunate acquisition? Who encouraged them to treat the deposites as an increase of capital? Who caused loans and circulation to be rashly augmented? Sir, the Message itself answers-"the Government, from the commencement of this connectio.!!" He needed not to stop to consider on whom the patronage was conferred; the Government sanction was given to all this monstrous abuse of public trust, f r reasons best known to him who now sits in the Presidential chair, reasons which he will never mention, if nobody else does! How profligate though, and insolent, must that man be, who first stimulates another to the height of intoxication and madness, for purposes of base profit, and then turns upon his victim and tool, and derides and denounces him to the world! Such is the conduct of "the Government"-the Ex and the In-President of the United States, towards the deposite banks! The increase of circulation, loans, and discounts was rather an etfect than a cause. Money was made plenty by the action of the Government. Money plenty-there was a domestic demand for credit, which caused domestic debt; and the same cause produced our foreign debt, and large importations-our speculations in public lands, and in every species of property. The Government officers especially were interested and engared, deeply and fraudulently, in these very land speculations; and the improvident extravagance of the Government. in ap. propriating immense sums to public works, drew off more labor from agriculture than all the private speculations of the nation could have done. The whole system tended and operated to hallucinate the public mind, and to corrupt the public morals. Cruel, indeed, is it, no less to the people than to the pet banks, to blame them with effects procceding directly from the mal-administration of the Government. In no other point of view are they to be blamed for their participation in the wrong than for having trusted their great interest and their liberties to such abandoned and insolent rulers! The system of the Government was not limited to the banks; it did stimulate "a general rashness of enterprise, and aggravated the fluctuations of commerce and currency." But the President takes comfort in his misfortunes from companionship in grief-from al eged distresses in other countries. He says: "It has since appeared that evils, similar to those suffered by ourselves, have been experienced in Great Britain, on the con tinent, and, indeed, throughout the commercial world; and that m other countries, as well as in our own, they have been uniformly preceded by an undue enlargement of the boundaries of trade, prompted, as with us, by unprecedented expansions of the systems of credit." Now, sir, we happen to have an authority upon this point, which does most conclusively show the fallacy of this position assumed by the Administration; an authority too which beauti fully illustrates the value and importance of a national bank in times of commercial and financial embarrassment and distress. Sir, I call the attention of the committee to a "statement rendered in the name of the Council General of the Bank of France, by the Count D'Argout, Governor," to a general meeting of the stockholders, on the 26th of January, 1837-" (See "The Financial Register of the United States," September 13th, 1837. No. 6, vol. 1.) 46 In this important document we find a full and satisfactory answer to this part of the Message, contradicting it expressly, and showing where the commercial crisis and pressure com. menced. The statement says: "The consolidation of public order has favored the extension of commerce, and has augmented the revenues of the State. Commerce has demanded of the bank the most ample means of credit; the increasing wealth of the Treasury has rendered the assistance of the bank less necessary and less useful to it. Far from regretting the diminution of our relations with it, we ought to congratulate ourselves; we therein find a certain proof of the prosperity of the country. We are happily very far from these critical periods, during which the bank had at the same time to assist commerce and to aid the Treasury. If at the latest of these epochs the bank was enabled to furnish. in a single year, 617 millions to commerce, and 253 to the Treasury, she feels honored by the recollection of it; but she felicitates herself at not being at this day called upon to employ her resources otherwise than in seconding the progress of commerce, or in protecting it against a return of those distressing vicissitudes which occasionally happen. "It is to this last result that she has just devoted all her ef forts. During the second half of the year 1836, the security of commerce appeared shaken, confidence was for a moment weakened. From the month of July some symptoms of a partial distress had begun to manifest themselves. The march of our manufactures had been so rapid, that there could not have failed to arrive a period of reaction. Some exportations of coin, the importance of which was exaggerated, and which are now insensibly reduced, excited a certain degree of anxiety, when a crisis rather severe overtook the United States. The scarcity of specie raised the interest of money there to an exorbirant rate. It was at London that the reaction of this crisis was first felt. The Bank of England, notwithstanding the power of her means of action and her well-known skill, found herself obliged to raise the rate of discount from 4 to 4 per cent. and subsequently to 5 The Bank of Amsterdam imitated this example. France could not withdraw herself entirely from the influence of these events, for the commerce of the whole world is more or less responsible for all its parts. "Although this commercial reaction only reached us secondhand, and consequently enfeebled, it could not fail to develop the seeds of embarrassment which I have just now alluded to. Thus, in many towns of the Kingdom, the interest of money rose to 5 and 54, and even for a moment to 6 per cent. Money became scarce; demands for specie were addressed to Paris from different points of France, and from neighboring countries. The coffers of the bank could alore furnish it. She had then to administer simultaneously to the wants of the capital and to those of the departments, as well as to those of the adjoining States. If the bank had shown the least hesitation, fears would probably have become general. The public funds, which had ⚫ already declined, would perhaps have experienced a much heavier depression; this momentary pressure might have been converted into a real crisis. "The bank, In this situation, restricted neither the length of time which paper had to run, nor diminished the amount of her discounts. She delivered up to the circulation one hundred and eight millions of specie, and discounted four hundred and fifty millions in six months. She maintained at four per cent. the rate of her interest, when this limit had been exceeded by a great part of Europe. It is thus that she was able to arrest or Making public officers depositories-Mr. Wise. to check a movement which seemed to be assuming a serious "But, in order to accomplish this, she was obliged to have "The interests of commerce, gentlemen, are therefore intimately allied to yours. The aggregate of the dividends of 1836 have given you a proof of it. You received, in 1834, but 80 francs, and, in 1835, 98; the year 1836 gives you 112 francs. This is the highest annual dividend that has been declared since the creation of the bank." So much for the pressure in Britain and on the continent of Europe. Indeed, sir, I believe the fact was, though I am not confident in stating it to be so, that cotton actually fell in New Orleans before advices were received of a fall in Liverpool! This is an unexampled fact, if it were so, that produce should fall at the place of exportation before it was known that prices had diminished at the market of sale! The fact might well be go, owing to the failures of our own merchants, and the total want of exchanges at home. I have endeavored to ob'ain accurate information as to this fact. I have only the information, however, contained in Mr. Raguet's communication in the National Gazette of the 14th of September last, under the sig. nature of "An Examiner;" and a letter from an intelligent gentleman of Philadelphia to a friend assures me that the heavy failures in New Orleans [Hermann, Briggs and Co. etc] took place about the end of February, or the 1st or 2d of March. This was shortly before the bad news was received from Liverpool." But, sir, there were other causes of this catastrophe, proceeding from the action of the Government, besides the increase of banking capital, circulation, loans and discounts, besides foreign and domestic debts, and the other causes enumerated in the Message. Besides the importation of some ten millions of silver dollars from abroad, which commenced with the removal of the deposites in October, 1833, and continued until July, 1834, and "which would not have been imported in the ordinaay course of trade," and which, in part, increased the issues, loans, and discounts of banks, and the debts consequently of individuals, I proceed to enumerate the "gold bill" as one of the most prominent acts of "the Government" which caused pres sure abroad as well as at home. I voted for that bill, and therefore owe an apology for my vote. The best apology I can make is the only one which the friends of the Administration can make for it-I ask forgiveness, for I knew not what I did! The party and the President were bent on the glory of gold: to increase its amount in the country was "a part of the system." I could not, at the time, see how the exchange in part of a silver for a gold basis would injure us, though I confess I did not understand how it was to benefit the country, and I was anxious that the Administration should have no excuse left for the failure of the experiment if it should fail, as it has. It is singular enough that more than one means which were selected to make the experiment more successful and permanently efficient have contributed most signally to its failure. So did the gold bill. The manner in which it has done so is clearly demonstrated in the 2d No. of "An Examiner." (See National Gazette of April 8, 1837 ) "Suffice it to say, that a more unfortunate measure for the country could scarcely have been devised, as I will now endea vor to make apparent. "By the mint regulations of 1791 the relative value between pure gold and pure silver was assumed to be 1 to 15, that is, one ounce of pure gold was assumed to be the equivalent to fifteen ounces of pure silver, and according to this proportion were the gold eagles and silver dollars and their fractions regulated. For some years our currency was composed partly of gold and partly of silver; but it so happened that, prior to the year 1818, he relative value of these two metals had undergone a change in the general market of Europe, so that one ounce of gold could readily be exchanged for more than fifteen ounces of sil· The consequence of this was, that whenever coin was required to be exported to Europe, gold was sent in preference to silver; and this exportation continuing until the year 1822, scarcely a gold coin was, at that period, left in circulation. Even the gold which was subsequently produced in the Southern States went abroad in search of its equivalent. ver. The "By this disappearance of gold, the currency of the United States became virtually a currency of silver. Silver dollars and their fractional parts were the coins universally employed. As the basis of a banking system, they had all the value of gold; and, if their portability was not as great, they were far more convenient than gold to the great mass of the people in the ordinary transactions of life. But this was not all. currency of the United States was placed in a state of independ ence as regards the currency of Great Britain, which was of gold; so that each country, in the management of its banking system, had only to look to itself. An expansion or contraction of the paper currency of either country had but a trifling influence upon the currency of the other, and the commercial pros perity of neither was placed at the mercy of the other. "One remarkable proof of the truth of this position is to be found in the well-known fact that the great panic and pressure for money which, in the year 1825, brought the Bank of Eng. land to the verge of stopping specie payments, and absolutely H. of Reps. compelled eighty private banks to suspend, was not felt in the do "But this was not all. The steadiness of the English currency prevented a fall from taking place in the prices of cotton and other American produce, which would have occasioned great loss to the American shippers, whilst, at the same time, it enabled British capitalists to extend relief to our merchants by the acceptance of bills of exchange, or by shipments of specie. "By the gold bill, enacted on the 28th of June, 1834, the relative value of gold and silver was changed, so as to render an ounce of gold the equivalent of about sixteen ounces of silver. Another law was passed on the same day, declaring certain foreign coins a legal tender, one of the effects of which was to make the British sovereign, or gold 'pound sterling, equal in value to about $4 874 of American currency; and the joint effect of the two was to render gold the preferred metal on all Occasions where importations of specie from Europe were called for the operations of commerce. From the date of the pas sage of these laws, the shipments from Europe were ordered to be made in gold instead of silver, and the consequence was, that this demand reaching the coffers of the Bank of England, the great repository of gold in Europe, produced an immediate effect upon the currency of Great Britain. by compelling the banks to contract their issues. Hence we find, by the Secretary's table, above referred to, that a contraction took place in the circulation of bank notes in England and Wales, so that, on the 27th of September, 1834, the amount was reduced to £28,591,112, and on the 28th of December to £27,729,828, being a diminution of upwards of seven millions of dollars. "From these facts, supported by the documentary evidence of the Treasury Department, as well as by sound reason, it is manifest that the passage of the gold bills identified the British and American currencies, and rendered each for ever thereafter liable to be influenced by the other. Expansions and contrac tions can now hardly fail to be simultaneous, and henceforth, more than at the period when the sentence was first pronounced by Mr. Gorham, in Congress, must it be true, that 'the barometer of the American money market hangs up at the Stock Exchange in London.' Over-issues by the English banks cannot fail to excite over-issues by the American banks; for, as Great Britain is the country in which almost all our exchange transactions with the world are concentrated, if the British standard of currency be depreciated below the metallic standard of the Continent, we shall feel its effects in our currency, without being able to detect it. 'Shall feel.' did I say? We do already feel it; and there cannot be a question that our present pecuniary embarrassments have been greatly augmented by the operation of this cause, resulting from one of General Jackson's 'humble efforts' to restore the constitutional cur rency. "With these evidences before him of the practical operation of a law which was capable of producing the most disastrous results, General Jackson, had he understood the subject, would have abstained from any active participation in rendering it more mischievous and fatal than the ordinary operations of commerce would have rendered it. But not so. Carried away, in the pursuit of his ignis fatuus-bis 'constitutional currency' he arrogated to himself the right, by the arbitrary exercise of his executive authority, of imposing a tax upon the owners of the French indemnity. Those citizens were entitled by treaty to the full amount of the sum stipulated to be paid by France, without any deduction whatever, either for the purpose of glorifying General Jackson, or for the purpose of enabling him to pursue his favorite Jack o'Lantern. They were also entitled to their money without a moment's unnecessary delay, and the manifestly plain course which justice demanded to be pursued was, to have given each claimant a bill upon France for the amount of his claim, to be negotiated or collected in the mode which best might suit bim. T is course was urged upon the Secretary of the Treasury by some of the claimants, who proved it to be the cheapest and most prompt mode by which they could be placed in possession of their property; and it is evident that, had any of the claimants wished gold for bis share, he could have imported it upon quite as favorable "The aggregate amount of gold coin and bullion imported during the year ending on the 30th September, 1834, was $3,706,172, of which $1,922,900 came from England, and $824,673 from France. "The aggregate amount of gold imported during the year ending on 30th September, 1835, was $2.325.16, of which $1,096,106 came from England, and $445,955 came from France. "It is probable that nearly the whole of this gold was imported within the last six months of the year 1834. under orders given after the passage of the gold bill, and before the country had recovered from the shock which led to the importation of coin. There was exported during this same year, in gold. $625,679, probably during the last six months of the financial year. 25th CONG.....1st SESS. terms as the Government; But no. The demands of justice weighed nothing in the scale, when opposed to the glory of the constitutional currency.' Orders were sent to France to transmit the amount of the four instalments of the indemnity paid in February, 1836, amounting to near four millions of dol lars, in gold. To procure this quantity of gold, a draft was made upon the London market, which, if it did not create, at least assisted to augment, that pressure upon the British currency which commenced in April, and which every one know. has been continued, with occasional fluctuations, up to the 1th March, 1837, the date of the last advices, and which has been latterly augmented by the additional demand for nearly another million of dollars, the amount of the fifth instalment of the indemnity paid by France in February last. It is not pretended that the whole pressure on the English money market within the last year has been occasioned by the last mentioned 'humble efforts' to restore the constitutional currency.' Other demands for gold have existed, amongst them one by the Bank of America, the principal deposite bank in New York, and one by the Bank of the United States, rendered expedient by the rapid return of her notes for payment in the early part of 1836, owing to the substitution in their place, throughout the Western and Southwestern cour.try, of the notes of some of General Jackson's three hundred and fifty-seven new banks. "Of the practical operation of theee two 'humble efforts' upon the immediate interests of the citizens of the United States it behooves us now to speak. "The contraction of the British currency, as every intelligent observer knows, has been to create a pressure for money in England, which has produced the following result: "1. The market rate of interest has been advanced from 24 to 5 per cent. per annum on first-rate commercial paper, which has had a tendency to keep money in England which would otherwise have sought investment in the United States. 2. British merchants are prevented from accepting with their accustomed freedom the bills of exchange drawn upon shipments of American produce. 3. British capita ists are less able than before to make advances, or loans on the security of American stocks, which cuts of a large source from which capital has been heretofore supplied for our various internal improvements. "4. British manufacturers are less able than heretofore to give credit to such of our importing merchants as require it. "5. The price of cotton has fallen, since the first of January last, four or five cents a pound, in England, by which American shippers will lose 20 or 25 per cent. upon the stocks gone forward, and by which our cotton planters will be deprived of a corresponding or a greater amount, as the fall of prices at the South has already made evident. "And now it only remains for us to inquire, how have these "humble efforts' tended to restore the constitutional currency?' Has the importation of thirty millions of gold and silver pushed any paper out of circula ion? So far from it, the amount of pa per has augmented, as we have shown, to an incredible amount. The banks all seen) to have acted upon the principle that their power to emit and keep their notes in profitable circulation was just in proportion to the specie they had on hand, and accordingly we have seen that, just in the measure that General Jackson supplied them with one million of dollars in coin, they supplied the public with three millions of dollars in paper. So much for the soundness of this 'constitutional currency;' and now for its uniformity. "On the 2d of January, 1830, when General Jackson, in his Messige to Congress, in reference to the Bank of the United States, said that it must be admitted by all that it has failed in the great end of establishing a uniform and sound currency,' the rates of domestic exchange were as follows, as appears from the New York Shipping and Commercial List: 1 per cent. discount. Richmond, North Carolina, Charleston, Savannah, New Orleans, 2 to 2 1 to 2 If to 2 1 to 14 do do do do "The rates on the 4th of March, 1837, the day after General "Exchange on Paris at New York, for a bill at 60 days' sight, between the 2d of March, and the 15th of June, 1836, fluctuated from what is called 5.25 to 5.40, making an average of 5.32 The par exchange on Paris is about 5.35; that is, one dollar of American currency is equivalent to 5 francs and 354 centimes, or one-hundredth parts of a franc. The exchange then was, at the period mentioned, halt per cent. above par; which, added to one per cent. which a bill at sight, such as the Government had a right to draw, and perhaps half per cent. for the superior security of a Government bill over a private bill, would make about two per cent. that the claimants would have received beyond the amount of their claims. It is true that the exchange upon France might have fallen something, in consequence of the increased supply of bills; but this could not liave equalled the loss which the claimants sustained by the delay to receive their money, which was not paid until July, and which was then subject to a deduction for the expenses of freight, insurance and commissions, incident to the importation of the gold. "The best commentary, however, upon the folly of these im portations, is to be found in the following article, which is copied from the Washington Globe of the 1st of April: "NEAPOLITAN INDEMNITY.-The last New York American contained the following: "The Bank of America will also draw their bills on the Rothschilds, of Paris, for upwards of a million of franes.' "The above sum, which the Bank of America proposes to draw for, is, we presume, on account of the next instalment falling due under the Neapolitan treaty. "The bank having, as we learn, an open credit to a large amount upon the Rothschilds, but being unwilling to avail of it, under existing circumstances, suggested that the next instaiment, to be paid in May or June, might be anticipated under that credit. The Secretary of the Treasury, we are informed, finding that the interest of the claimants, in the present state of things, would be promoted by availing of the present high rate of exchange, over any other mode of bringing home the funds, and that, to the extent of the same, they might be used to relieve the community, unhesitatingly assented to the suggestion, and directed the Messrs. Welles, the agents for receiving the indemnity, to pay it over to the Messrs. Rothschilds as soon as received, to reimburse them for the bills drawn in anticipation of its receipt. "It is for this suin, and upon this arrangement, we presume, the Bank of America proposed to pass the bills on Paris.'" "Let these two tables speak for themselves. "And now, reader, with all these proofs before you, of the total failure of all General Jackson's schemes of finance, can you read the following passage in hi-Farewell Address, without asking yourself whether he was really in earnest? "My bumble efforts have not been spared during my administration of the Government to restore the constitutional currency of gold and silver and something, I trust, has been done towards the accomplishment of this most desirable object.' "AN EXAMINER." In addition to these causes, set in operation by the Govern ment, came the celebrated Treasury order or circular of July 11, 1836. This circular enacted by Executive order that after the 15 h day of August. 1836, the receivers of public money and the deposite banks should receive in payment of the public lands nothing but gold and silver, and in the proper places Virginia land scrip. Frauds, speculations and monopolies in the purchase of the public lands, and excessive bank credits, were made the pretext of this extraordinary measure, when these frauds, speculations, monopolies, and excesses of every description, had been known for a long time to the Administration, and participated in particularly by "the party," from the removal of the deposites to the moment when General Jackson was aroused vindictively to prevent the deposites with the States, directed by the deposite act of June, 1836. Whatever other difference of opinion there may be as to the effects of this or der, al! will agree that it removed the specie of the country from the large importing cities and the most important places of trade, and placed it in the "Far West," where it was locked up in the land offices or Western deposite banks, and rendered unavailable to commerce and to the wants of trade in an anomalous period of unexampled plenty and pressure! The gentle. man from South Carolina, (Mr. Legare,) as I understand, admits this effect of the circular, and that it accelerated a revulsion, the severity of which the President says none had correctly anticipated. Had the specie of the country been permitted by the Government to remain where trade required it to be, none can say that the same extent of ruin would have been felt, or that it would have been felt so soon. Such, sir, are some of the "antecedent causes" whence "overaction" derive! "its first," and, I may add, its last "unpulses!" Forsooth, I had nearly omitted one cause, enumerated by Mr. Secretary Woodbury, which the President, in his wisdom, had entirely over-looked-the over-production of cotton!!! The over-production of cotton!-there is an example of a financier for you! Oh! rare Levi! Much more wisely had he spoken if he had in ascribing the causes of our disasters, enumerated the potent reason that we had at the head of the Treasury Department a financier who regards the products of labor and industry as causes of national poverty and bankruptcy! A head that has not been wool gathering, but picking cotton! In the comparison of our condition with that of other countries, the President admits that "the most material difference between the results in the two countries [United States and Great Britain has only been that with us there has also occur. red an extensive derangement in the fiscal affairs of the Federal and State Governments." Ay, sir, there is the rub! Why has there not been in England and in France the same extensive derangement in fiscal affairs as in the United States, whilst there has been, according to the Message, "the same redundancy of paper money and other facilities of credit; the same spirit of speculation; the same partial saccesses; the same difficulties and reverses; and, at length, nearly the same over-whelming catastrophe ?" Is it because our finances have not been managed so well, that we have had Levi at the helm, or that we had not, as France and England had, the great conservator, the life-preserver, a National Ban!? Sir, this "material differenco" is owing to both reasons. We doprived ourselves of the means of preserving credit, disabled the ship before the storm came on, shipped an incompetent crew and a worse pilot; and when the hurricane came--as hurricanes in trade will come as certainly as storms on the ocean-it swept over us at mercystruck the ship of State down on her beam ends--dis masted, and leaking-and there she will lie, with hope only to aid her until the despairing mariners, now standing on her sides with spy-glass in hand, shall discover far out upon the "dim distant sea" a speck of sail sent by Providence alone to right ship, and save all hands from a watery grave! Strong canvases, new rigging, ballast and compass, and skilful crew and pi'ot, will not prevent the storm, but they alone can save the ship from the tempest when it b'ows. So with a National Bank and other means of regulating finance and currency-they cannot prevent the vicissitudes of trade and commerce, or wholly arrest their ravages and disasters, but they can save us from despair and death! The report of the Bank of France proves his at this moment. That nation was not only guarded from death and despair, but restor d to health, and sustained in actual prosperity by sustaining a National Bank, whilst we have been nearly destroyed by destroying one. But, why trace the causes of this revulsion in our affairs } Sir, the Administration knew from the first that the State banks were unsound. In proof of this I refer you to the letter of Mr. Taney, of the 15th of April, 1834, pages 4 and 5. He says: "If the estimate I have made of the proportion between the paper circulation and the specie in possession of the banks be correct, or nearly so, the condition of the currency is obviously such that the nation should not be content with it, nor desire to continue it in its present state. It is an immense superstructure of paper, resting on a metallic foundation too narrow to support i. It has never been sustained by its own inherent strength, but by public confidence. When every one firmly believes that the notes of the banks will, on demand, be paid in coi, they will readily circulate, and answer all the purposes of money. But the moment that confidence is impaired, they lose their value as a part of the circulating medium, and are returned upon the banks for redemption in specie, and the disproportion between the paper circulation and the coin prepared to redeem it is so great, that it is constantly liable to have its chief support, public confidence, withdrawn from it." I refer, also, to a statement of the condition of the local banks, furnished about the same time by the honorable R. II. Wilde of Georgia, and printed by order of the House of Repre sentatives in the session of 1833-34. Thus, sir, the Admini H. of Reps. stration knew from the beginning that, these agents, the local banks, could not stand the shocks of tracs. The President himself says, "that the prospect of revulsion was present to the minds of considerate men before it actually came." Why was no warning given, no preparation made? Were our rules not "considerate men?" Is it not true, as I have shown, that up to the fourth day of March last they were at ll crying in the night-watch, all is well?" Sir, they knew of these cauzes, and they intended their effects! No matter what are the cause, the ruin is here! and the Administration designed to bring it upon the country for the diabolical purpose of establishing upon this ruin a Treasury bank! Yes, sir, the very result of all these causes of mischief, whatever they may be, is now proposed as the second systemanother experiment! This result is what has been aimed at all the time--the final triumph of Executive power-the total ruin of the liberties of the country-the complete union of the purse and sword!" In the very midst of our calamities and misfortune, we are told to take up the very condition of distress into which we have been thrown by mismanagement and cor ruption, and to organize it into a permanent system of financeay, sir, from one quarter, not the most inconsiderable and uninfluential source of these mischiefs, we have heard boasting and exultation atthe calamities of the country. A letter written from St. Louts. August 11th, 1837, signed by Big Bully Bottoin, Tom Benton, "congratulates" the party in Ohio "on the suc cess of General Jackson's endeavors to improve the condition of the currency!" Sir, that man is misunderstood-that letter does not embody impudence and effrontery so much as it sets forth the real feelings, and shadows the designs of those in power-he knows their secrets-to force upon us now the exe crable end of policy which they have always aimed at-to make the Government a bank, and the President of the United States and the party" its "President, Directors, and Co.!!" This is not the desperate courage or bravado of a ruffian who is forced to brave every danger in the last extremity, but it is the chuckling of a fiend who has really reached the diabolical end he aimed at over the disasters and suf ferings and ruin of a whole people! He knows that the danger now is not the re-establishment of a national bank, bus that a revolution in the Government is already effected by forcing a "scourged country" and an "humbled democracy" into a system of Sub-Treasuries which will subvert all our encient institutions, and laugh this republic to scorn! Above all the passages in the message-except one which I shall presently notice-the most pharisaical and insincere is that in which the President says he is "sensible that ade. quate provisions for these unexpected exigencies could only be made by Congress; convinced that some of them would be in dispensably necessary to the public service, before the regular period of your meeting; and desirous, also, to enable you to exercise, at the carliest moment, your full constitutional powera for the relief of the country, I could not, with propriety, avoid subjecting you to the inconvenience of assembling at as early day as the state of the popular representation would permit. I am sure that I have done but justice to your feelings in believing that this inconvenience will be cheerfully encountered, in the hope of rendering your meeting conducive to the good of the country." ter: Sir, why was Congress called at all? Does it matter whether we act at all? Has the President not put the system in operation, and is it not in full blast? Yes, sir-by the fiat of the Executive, by a single "circular" from the Secretary's pen, is the Sub-Treasury system called into being, full formed and per fect. See, sir, see with what despatch, with what unity and simplicity of action, one will controls already the destiny of this nation. See this circular, and know the will of your mas. CIRCULAR TO RECEIVERS OF PUBLIC MONEYS. "TREASURY DEPARTMENT, May 12, 1837. "If the bank where you deposite should suspend specie pay ments, you will keep in your own hands safely the public money you have in possession, or may hereafter receive, till further directions are given to you by this Department how to deposite, transfer, or pay it, or any portion of it. "You will report to this Department weekly the amount on hand. LEVI WOODBURY, "Secretary of the Treasury." By this simple instrument-a circular!-have magic changes been wrought in the form and policy of our Government; it has, by such means, been truly made a "simple machine!! After having done the deed, and put the system into full operation, then Congress is called, not to deliberate, not for consultation, but to register Executive edicts, or to adjourn! He proceeds: For the deposite, transfer, and disbursement of the revenue. National and State banks have always, with temporary and limited exceptions, been heretofore employed; but, although advocates of each system are still to be found, it is apparent that the events of the last few months have greatly augmented the desire, long existing among the people of the Iited States, to separate the fiscal operations of the Government from these of individuals or corporations." How long, I would inquire, sir, has this desire to separate the fiscal operations of the Government from those of individuals or corporations" existed? Not longer, surely, than since the 4th day of March last. Sir, what said Mr. Taney, on the 15th of April, 18347 (See his letter to the Committee of Ways and Means, pp. 9, 10.) After saying "the State banks are now so numerous, and are so intimately connected with our habits and pursuits, that it is impossible to suppose that the system can ever be entirely abandoned-nor is it desirab that it should be"-he proceeds: "If there were no State banke, the profitable business of banking and exchange would be monopolized by the great capi talists. Operations of this sort require capital and credit to a large extent, and a private individual, in moderate circumstances, would be unable to conduct them with any advantage. Yet there is, perhaps, so business which yields a profit so certain and liberal as the business of banking and exchanges; and it is proper that it should be open as far as practical le to the most free competition, and its advantages shared by ail classes of society. Individuals of moderate means cannot participate in them, unless they combine together, and by the union of many small sums create a large capital, and establish an extensive credit. It is impossible to accomplish this object without the aid of acts of incorporation, so as to give to the company the security of unity of action, and save it from the disadvantages of frequent changes in the partnership, by the death or retirement of some one of the numerous partners. The incorporated banks, moreover, under proper regulations, wih 25th CONG......1st SESS. offer a safe and convenient investment of small sums to persons whose situations and pursuits disable them from employing the money profitably in any other mode. It is not inore liable to be lest when vested in the stock of a bank, than when it is loaned to individuals. The interest on it is paid with more punctuality, and it can be sold and converted into cash, whenever the owner desires to employ it in some other way. And if a larger poruon of the metals is infused into the circulation, the business of banking will become more sound and wholesome, and less liable to the disasters from which it has suffered, under our extravagant and ill organized system of paper issues. It will render investments in banking companies entirely safe and secure to the holders, and afford them the almost absolute certainty of a reasonable profit, without endangering the capital invested in it. "For these reasons, it is neither practicable nor desirable to discountenance the continuance of the State banks. They are convenient and useful also for the purposes of commerce. No commercial or manufacturing community could conduct is business to any advantage, without a liberal system of credits, and a facility of obtaining money on loan when the exigencies of their business may require it. This cannot be obtained without the aid of a paper circulation, founded on credit. It is, therefore, not the interest of this country to put down the papei currency altogether. The great object should be to give it a foundation on which it will safely stand. A circulating medium composed of paper, and gold, and silver, in just proportions, would not be liable to be constantly disordered by the accidental embarrassments or imprudences of trade, nor by a combination of the moneyed interest for political purposes. The value of the metals in circulation would remain the same whether there was a panic or not, and the proportion of paper being less, the credit of the banks could not be so readily inpaired or en langered." What said Mr. Woodbury in December of the year? (See the Report of the Secretary of the Treasury "On the present system of keeping and disbursing the public money." ber 12, 1834.) ." Decem "With the causes of these last and most important failures happening from time to time, as the table shows, to the very last year, this branch of our inquiry has no particular concern except to discriminate them from others, and from any special connection with the system that prevailed from 1811 to 1816. Whether they arose from an unsound policy pursued by the United States Bank, or from circumstances which, under the paper system, neither legislation nor caution can always avert, or from less justifiable reasons, and in spite of all the salutary influence the National Bank could exercise, it is a singular fact, in praise of this description of public debtors, the selected banks, that there is not now due on deposites, from the whole of theni which have ever stopped payment, from the establishment of the Constitution to the present moinent, a sum much beyond what is now due to the United States from one mercantile firm that stopped payinent in 1825 or 1826, and of whom ample security was required and supposed to be taken under the responsibility of an oath. "If we include the whole present dues to the Government from discredited banks, at all times and of all kinds, whether as depositories or not, and embrace even counterfeit bills, and every other species of unavailable funds in the Treasury, they will not exceed what is due from two such firms. Or almost one hundred banks, not depositories, which, during all our wars and commercial embarrassments, have heretofore failed in any part of the Union, in debt to the Government on their bills or otherwise, it will be seen, by the above table, that the whole of them, except seventeen, have adjusted every thing which they owed, and that the balance due from those, without intercet, 18 less than $82,000. Justice to the State banking institutions, as a body, whose conduct in particular cases has certainly been objectionable, but whose injuries to the Government have been alnost incredibly exaggerated, and whose great benefits to it, both during the existence of our two national banks, and while neither of them existed, have been almost entirely overlooked, has led me to make this scrutiny, and submit its results, under a hope that it will, in some degree, not only vindica e them from much unmerited censure, but justify this Department for the confidence it formerly, and, in the great improvement of their condition and of the financial affairs of the Go ernment, has recently, reposed in them. Under these circumstances, so very favorabic, with the new security and examinations provided for, if our former small losses by them, in kee, ing and paying over the public revenue, under circumstances so very adverse, are compared with our farge losses, either in collecting or disbursmg that revenue, their present safety se ms to be as great a is consistent with the usual operations of the paper sy stem, or with the credit which must always be entrusted by Government, in some way or other, to agents of some kind in keeping the public money. In considering their safety, it should be constantly recollected that the owners and managers of banks, when properly regulated by legislative provisions in their charters, are, like other individuals, interested to transact bus.nes securely; are desirous of making, and not losing, money; and that these circumstances, with the preference in case of failure belonging to depositors and holders of their bills over the stockholders, united with the security, if not priority, given to the Government, render them, in point of safety, generally inuch superior to individual agents of the United States. It is to be further remembered that many of the former losses occurred indirectly and remotely from war and embarrassments, affecting deeply the whole community as well as banking insti tutions, and from the injurious influence of which calamities, banks, whether of State or United States origin, can never claim a full exemption; that the correct principles of banking were, at that time, less generally understood and practised than at the present time; that the selected banks, by the course of our expenditures and collections, were then exposed to more onerous duties and hazards; and that less full information of their true condition was then possessed by this Department." Such were the views of both Secretaries, and the only heads of the Treasury Department since the removal of the public de osites in 1833. In 1835, General Gordon, of Virginia, made his celebrated proposition in the House of Representatives, to receive nothing but gold and silver in payment of the public dues, and to make the receivers of public money its depostto11984. Sir, it becomes me to give the history of that proposition. At the time it was made, the bill to regulate the deposite and wale keeping of the public rooney was before the House, and then, to, the din of jingling promises to give us a hard money Government, a metallic currency, and a circulation of gold, was Making public officers depositories-Mr. Wise. almost deafening. I knew the promises were false and the pro. fessions were hollow then. I knew that the Administration could not, if it would, do what it professed, and I was anxious only that its inability and weakness and "humbuggery" might be inade manifest before its measures brought upon the country this present crisis which I then foresaw. With my colleague, General Gordon, the proposition was sincerely made. He was opposed to the constiturionality of the Bank of the United States, and distrusted the system of employing the local banks as depositories. He came to the with his scheme, and asked if I would vote for it. I told him, at first, that I would not; that it was as objectionable to me, even more so, than the other measure; that I had no scruples about the constitutionality of a national bank: and I thought then, as I think now, that it alone could insure the safety of the public money, and restore our finances and currency to a healthy and sound condition. But there was no prospect of a recharter of a United States Bank. and I was forced to vote for or against the only other two measures to be adopted. He asked me, as an act of courtesy to him, to vote to let his proposition in. I consented to vote for its introduction into the House, warning him that I should finally vote against its passage if it was likely to succeed. I voted afterwards for it, on the main proposition, as many of the Opposition members did, simply to show that the Administration did not desire what they then professed, as now, to separate the fiscal operations of the Government from those of individuals or corporations! I knew that the party" and that the then powers would not sus. tain the proposition or I should have voted against it. It then required but few Administration votes to carry the measure; but behold! as I calculated, they voted against it to a man! The vote on the proposition of General Gordon then proves, if it proves any thing, that there was no such desire, as the Presi dent says has existed for a long time on the part of the Government, in the spring of 1835! It would be as easy to show, sir, that there was no such desire expressed as late as the 4th of March, 1837. The gentleman from South Carolina (Mr. Pickens,) however, is right; the proposition to separate the Govern ment from the banks, and to destroy all banking institutions, is not new; it originated with Fanny Wright, but the desire which the President describes has continued for a long time only with that part of "the Government" yeleped Thomas Hart Benton. The great expunger and humbugger was the first to introduce the Locofoco doctrines into Congress, and to give them character before the nation; and, let me tell my friend from South Carolina (Mr. Pickens.) that he will be deceived who thinks to deprive Benton of his hobby-that if these destructive doctrines are to come into vogue and in favor with a majority of the people, Benton is as much identified with them as Thomas Jeffer son was with the doctrines of '98, and he (Benton) and no other inan under the sun will ride into power on their popularity! B, sir, however old this proposition to divorce the Govern ment from all banking corporations may be, there is a doctrine new under the sun contained in this notable Message. The President expressly refrains from suggesting to Congress "any specific plan for regulating the exchanges of the country, relieving mercantile embarrassments, or interfering with the ordinary operations of foreign or domestic commerce, from a conviction that such measures are not within the constitutional province of the General Government, and that their adop tion would not promote the real and permanent welfare of those they might be designed to aid." He says the accommodation to domestic exchanges "is now, indeed, after the lapse of not many years, demanded from it, the Government, as among its first duties," etc. When was this accommodation not demanded of the Government as among its first duties? Certainly, to afford this very accommodation was among the most oft-repeated, though oftener violated promises of General Jackson's administration, from the removal of the public deposites, in 1833, up to the 4th day of March last. Every message of President Jackson, from the one period to the other, and every report of his respective Secretaries, as well as the numerous circulars of the Treasury Department, the reports of the Committees of Ways and Means in this House, and other documents, will show that the currency of the country at large, its domestic exchanges, its commerce, and all its monetary interests, were taken especially under the guardian care and protection of this same most beneficent Government, which then promised us a better currency, and now tells us we must not look to the Government for "too much!" Surely, sir, the present incumbent is not about to falsify his promise to "follow generally in the footsteps of his illustrious predecessor;" or does he mean to follow them as my young friend from Tennessee (Mr Crockett) felicitously expresses it, "by taking the back tracks?" Sir, it is profitable now to recur to the wholesome doctrines of the preceding Administration respecting the duties and powers of this Government in relation to a sound and uniform currency. (See Executive documents, 1833-134, No. 2, pages 5, 6, 10, 11.) In this report of Mr. Taney, after insisting "that the interests of the country would not be promoted by permitting the deposites of the public money to continue in the bank until its charter expired," he says: "Besides, the principal circulating medium now in the hands of the people, and the one most commonly used in the exchange between distant plases, consists of the notes of the United States Bank and its numerous branches. The sudden withdrawal of its present amount of circulation, or its sudden depreciation before any other sound and convenient currency was substituted for it, would certainly produce extensive evils, and be sensibly felt among all classes of society. It is well un derstood that the superior credit heretofore enjoyed by the notes of the Bank of the United States was not founded on any particu lar confidence in its management or solidity. It was occasioned altogether by the agreement on behalf of the public, in the art of incorporation, to receive them in all payments to the United, States: and it was this pledge on the part of the Government' which gave general currency to the notes payable at remote branches. The same engagement in favor of any other money. ed institution would give its notes equal credit, and make thei equally convenient for the purposes of commerce. But this ob ligation on the part of the United States will cease on the 3d of March, 1836, when the charter expires; and, as soon as this happens, all the outstanding notes of the bank will lose the peculiar value they now possess; and the notes payable at distant places become as much depreciated as the notes of local banks. And if in the mean time, no other currency is substituted in its place by common cousent, it is easy to foresee the extent of the embarrassment which would be caused by the sudden derangement of the circulating medium." He then promises that "the State banks can furn`sh a circulating medium quite as uniform in value,' as that of the United H. of Reps. States Bank-"probably more so;" and afterwards states "the condition of the mercantile classes at the time of the removal, to explain why it was impossible to postpone it even for a short period." These views of the Secretary were confirmed and supported, of course, by the report of the Committee of Ways and Means, made to the House of Representatives, March 4th, 1834, precisely as the opposite views entertained by the present Executive are in like manner echoed by the same committee now. By-the-by, the question was asked in 1834, why the then Committee of Ways and Means was like a tadpole? It was little at both ends (two certain gentlemen being at the two ends, the one at the head, the other at the tail) and big in the middle, (Binney and Wilde being there) The report of that date says: "There appears also to be much force in the considerations urged by the Secretary, connected with the currency of the country and the domestic exchanges. The notes of the Bank of the United States must necessarily, in a short time, be withdrawn from cuculation. That the principal currency of the country, for many years to come, will be bank notes, there is no reason to doubt; and it is certainly good policy to foster the State banks which furnish them, in measures tending to give them as general credit as has heretofore attached to the notes of the United States Bank and branches. That the natural and ascertained course of trade, circulation, and exchange, connected with the interests of banking institutions, will ultimately produce this result in relation to the notes ofthe principal State banke, there is every reason to anticipate; but their employ. ment in the business of the Government, by awakening them to their capacities and interests, is calculated to hasten the consummation of so desirable an event. It was a matter of no small moment to encourage and hasten the State Banks in maturing their system of circulation and exchange, so that at the termination of the charter of the Bank of the United States, the trade of the country might not encounter at the same time the loss of a general currency, and the entire breaking up of the domestic exchanges, a partial interruption of which by that bank is now producing such serious inconvenience. By the latest returns of the banks employed by the Government, it appears that they are already rapidly taking the place of the Bank of the United States in the exchange operations." See, also, Mr. Taney's letter of the 15th of April, 1834, already in part quoted, passim. Mr. Secretary Woodbury, in his report to Congress, December, 1:34, says: "The wealthy and commercial, for whose benefit chiefly banks were instituted, will then chiefly use their bills, and suffer by them if forged or depreciated; while the laboring classes and men of small means will, by the justice and paternal care of the Government, generally be provided with a currency of hard money, not exposed to any risk of failures, and to be used for all dealings of such an amount as their daily or weekly wants may in most cases require.” See, also, the Message of President Jackson to Congress, December, 1835, and the report of Mr. Secretary Woo bury, of the same date, (already quoted.) See, also, the Message of the President and the report of the Secretary of the Treasury, December, 1836, (already quoted.) In addition to these documents, I refer, sir, for conclusive proof that General Jackson took the currency, domestic exchanges, and the circulating medium, wholly under the "paternal care of the Government," to the report of the investigating committee, of which my colleague (Mr. Garland) was chairman, made to the House of Representatives, March 1, 1837. See the letter of the six deposite banks of Philadelphia, New York, and Boston, to Mr. Taney, dated in October, 1833, Whitney's letter accompanying the same, and Mr. Woodbury's answer, November 4, 1834. Therein are to be found similar expressions to this: "In proportion as this system shall be well digested and executed, will be the soundness and equality of value throughout the Union of the circulating medium; and upon it will depend the degree of convenience or inconvenience which will be felt by the public in consequence of the recent change." I refer, sir, also to an anonymous letter in the correspondence of Whitney with the deposite banks, dated November 8, 1834. I refer to the circulars of Whitney to the deposite banks, franked by Levi Woodbury, dated May 30, 1536, September 7, 1836, and December 7, 1836. And, sir, I appeal to my colleague (Mr. Garland) if it does not appear throughout the whole investigation that one of the principal purposes of Whitney's agency was to confederate and knit the banks together in one grand systein of exchange. As a specimen, sir, of the whole business of the agency of Whitney and of the deposite banks, I will read a letter from him to John Bass, President of the Union Bank, Tennessee, Nashvilic, dated Washington. March 16, 1835: "SIR: I am in receipt of your favor of the 23d ultimo. In reply to your request. I have to say, that the letter written by a person here high in the confidence of the Government, a copy of which I sent you with the other papers, gave you, in part what it was expected the agent appointed by the deposite banks would attend to. I will, however, state, as fully as I can, the duties the agent feels as devolving upon him. He expects to perform precisely the same duty that he would if appointed by the Treasury to superintend the deposite banks generally. He will carefully watch the operations of each; endeavor to produce concert of action; make suggestions in relation to operations of any which are calculated to lead to an improvement of the currency, or any which are necessary to preserve it from being affected by the operations or issues of any of the selected banks; aid and advise in establishing a system of domestic exchanges throughout the country, through the agency of the deposite banks, whereby the country shall reap all the advantages through such agencies that it ever did through the operations of the branches of the Bank of the United States. "The agent will also feel bound to inform each deposite bank which employs him, at different periods, as nearly as he can from the estimates of the various Departments, of the probable amounts each one will be called upon to disburse within a given period; the amounts and times when they will be called upon to pay it over; and where transfers will be required to be made from one bank to another, for the purpose of meeting such cails, the banks from which, and the times when, such transfers will be made. "Such a table is now being prepared, to embrace the next six months ending the 30th of September next. This will embrace the estimated expenditures of the War and Navy Departments, as well as the civil list; the States in which the same is to be disbursed; the probable time wanted, and the banks which will have warrants passed upon them. "In fine, the agent will communicate to each selected bank that wishes it, any information which he may at any time think will be serviceable individually; as well as give that general superintendence to the operations of the whole, which is so neces 25th CONG.....1st SESS. sary for the security of each, as well as for the promotion of the interest of the public generally. "I am, with great respect, your most obedient servant, "R. M. WHITNEY. "JOHN M. Bass, esq. "President Union Bank of Tennessce, Nashville." In addition to the documents on file here, I cite the circulars of the Treasury Department, published from time to time dur ing the last four years, and directed to the receivers of public money and the deposite banks. As specimens, I quote, first, a circular dated the 7th of July, 1834: TREASURY DEPARTMENT, July 7, 1837. SIR: As the public confidence in the banks selected by this Department for public deposites has, on trial, increased, and the notes of most of them might become a very convenient medium for circulation in travelling, and the transmission of funds at a distance, if mutual arrangements were made between some of them for the redemption of each other's bills, I take the liberty to submit the following suggestions for your consideration: 1st. Would it not be profitable to your corporation, as well as useful to the public, to make arrangements and issue bills to a limitel amount, payable on their face either at your own bank or the bank with which you make the arrangement? This has already been done by some institutions, and, it is believed, with beneficial effects. 2d. But, if this is not considered expedient, would it not be prudent to establish with certain banks a credit, mutual if you choose, to redeem and reissue a certain amount of each other's bills as they may be needed for the purposes hefore mentioned? This might be so arranged as to expose you to little expense or risk; and the fact being known, would extend your ci culation at a distance, and often furnish, it is trusted, a currency for travelling and transmission of funds, very safe, convenient, and advantageous. Any aid that this Department could lend to you in perfecting such arrangement, by transfer drafts or otherwise, consistently with its powers and the public interests, will at any time be cheerfully granted. I remain, very respectfally, your obedient servant, The PRESIDENT of the. Secretary of the Treasury. On the 27th of January, 1835, the following circular was is sued: TREASURY DEPARTMENT, Washington, Jan. 27, 1835. SI: Finding that my circular of the 13th of December last has not, in all instances, been fully understood, I beg leave to state, that it is the wish of the Department to be enable 1 to present a correct statement of all the domestic exchange operations of the selected banks. For this purpose, I have to request that your statements, semi-monthly, hereafter, give the whole of your operations, whether in drafts on other places purchased, notes payable in other places discounted, or either, collected. The latter to be brought into the statement after they are carried to the credit of the individuals for whom collected, together with the rates in all cases, &c. Some of the banks have supposed that the request of 13th ultimo was not intended to embrace paper collected, payable out of the city. Where that has been the case, I have to request that all emissions of this description, since the 1st instant, may be added to the next return made to this Department. As before requested, I wish a statement of all drafts or checks drawn by the bank, payable any where out of the place in which the bank drawing is located, together with the rate, &c. As early as convenient, after receipt of this, I will thank you to forward to this Department a statement of the places upon which your bank collects or purchases domestic exchanges, together with a tariff of the rates charged, exclusive of intrest. I will also thank you to state the extent, geographically, to which it receives, on deposite, the notes of State banks, and particularly those of the selected banks; also, such as have made arrangements with you to redeem their notes, where any such arrangement has been made, as well as where arrangements may have been made with other banks for the redemption of your notes. I am, very respectfully, The CASHIER of the Your most obedient servant, Bank. On the 6th of April, 1835, the following was issued: TREASURY DEPARTMENT, April 6, 1835. It is understood, that the instructions from this Department to receive for the public dues only such State bank notes as the deposite bankare willing to credit at par, have been construed to authorize the receipt of such notes of any denomination. The undersigned considers it highly beneficial to the currency of the country and the safety of the banking agents employed in keeping the public revenue, that the more general use of specie for the small and ordinary transactions of society should be encouraged; and as the disuse of bank notes of a low denomination is believed to be the surest method to effect that object, and as the acts of Congress do not expressly require the receipt of any such notes, if less in amount than five dollars, you are heroby directed, after the 30th day of September next, not to receive in payment of any public dues bank notes of any denomination less than five dollars. You are also apprized that it is in contemplation by this Department, after the 34 of March, 1836, [should Congress in the me time make no new provision on the subject.] to exercise the discretionary powers, which it is supposed will then belong to it, over the receipt of paper money of any denomination for the public revenue, and to extend the restriction on the receipt for it, to all of a less denomination than ten dolof bank notes, lars. For the greater security of the banking institutions employed by the Treasury, and for the improvement of the cur rency by the fuller restoration of that specie circulation for common purposes, which seems to have been contemplated by the Constitution, it is intended then to make arrangements, if practicable, to discontinue the use of any bank as a fiscal agent which shall thereafter continue to issue notes of a less denomi nation than five dollars, and which shall, after some subsequent period, to be then designated, continue to issue notes of a less denomination than ten dollars. The course proposed to be pursued hereafter on this subject by the Treasury, is now indicated with a view to ensure suita. bie notice of the changes contemplated. On the 22d of February, 1836, the following was issued: Making public officers depositories—Mr. Wise. To Receivers of Public Moneys, Collectors, Disbursing Offi cers, and the Deposite Banks of the United States. TREASURY DEPARTMENT, Feb. 22, 1836. The established policy of the Treasury Department, so far as may be practicable, under its present powers over the collection, keeping, and disbursement of the public money, is to di minish the circulation of small brand-koles, and to substitute specie. and especially gold, for suck notes, trith the rise of rendering the currency of the Country, through which its fiscal operations are perfortid, more safe, sound, and uniform. In pursuance of that policy, a circular was issued last April, which prohibited, after the 30th September, 1835, the recent, on account of the Government, of any bank notes of a less denomination than five dollars; and which intimated that other steps to promote the desirable objects before named, would, in due time, be taken. Consequently, in further pursuance of the same policy, you are hereby required, after the 1st of May next, not to pay the demands of any public officer or creditor in any bank notes of a less denomination than five dollars, and, except when it may be otherwise prescribed by law, after the 4th of July next, not to receive or pay on account of the Govertiment any bank notes of a less denomination than ten dollars. All the deposite banks are requested to supply themselves with such a quantity of American gold coin as to be able to pay, and, when a public officer or creikter prefers it, and his demand does not exceed five hundred dollars, to pay at least one-fifth of such demand in that coin. It is also requested that the depo site banks will not, after the 4th of July next, issue any notes of a less denomination than five dollars; and that, after the 24 of March, 1:37, they will not, unless the subject be otherwise regulated by Congress, issue any notes of a less denomination than ten dollars. It is believed that the amount of gold which by that time shall be coined at the mint, will be sufficient to admit of the convenient substitution of it for small notes in a much greater extent than at present; and it is deemed reasonable, that while the deposite banks have the use, without interest, of unusually large sums of the public money, they should make some further temporary sacrifices to obtain and circulate gold, and in other respects to enlarge the specie basis of our circulating medium. From these considerations, and from the liberal spirit evinced by most of the public depositories in a late correspondence with them on this subject, it is confidently expected that, in this state of things, they will cheerfully com. ply with the above requests, and with all others which have been made by the Department, with a view of improving the cur rency: nor will it, I trust, be considered unjust or impolitic, while the deposite banks shall continue to enjoy great pri vileges from the Treasury, to regard a neglect or refusal by any of them to comply with those requests as sufficient cause for discontinuing the employment of such bunks as fiscal agents. At a proper time it will be decided under what cietumstances, and at what periods, these restrictions on the agents and officers of the Treasury shall be extended to notos of any denomination under twenty dollars. This communication is made with the sanction of the Presi dent of the United States; and it is hoped that, till otherwise prescribed by Congress, or by this Department, these requirements and requests will be faithfully complied with by all the fiscal agents of this Department, and all the collecting and disbursing officers of the Government. LEVI WOODBURY, Secretary of the Treasury, And, sir, on the 11th of July, 1836, the celebrated specie cir cular went forth like a bull from the Vatican. To Receivers of Public Money, and to the Deposite Banks. TREASURY DEPARTMENT, July 11, 18 6. In consequence of complaints which have been made of frauds, speculations and monopolies, in the purchase of the public lands, and the aid which is said to be given to effect these objects by excessive bank credits, and dangerous, if not parial, facilities through bank drafts and bank deposites, and the general evil influence likely to result to e public interests, and especially the safety of the great amount of money in the Treasury, and the sound condition of the currency of the country from the further exchange of the national domain in this manner, and chiefly for bank credits and paper money, the President of the United States has given directions, and you are hereby instructed, after the 15th day of August next, to receive in payment of the public lands nothing except what is directed by the existing laws, viz: gold and silver, and in the proper Virginia land scrip. cases, The principal objects of the President in adopting this measure being to repress alleged frauds, and to withhold any countenance or facilities in the power of the Government from the monopoly of the public lands, in the hands of speculators and capitalists, to the injury of the actual settlers in the new States, and of emigrants in search of new homes, as well as to discou rage the ruinous extension of bank issues and bank credits, by which those results are generally supposed to be promoted, your utmost vigilance is required, and relied on, to carry this order into complete execution. Such are some of the footsteps of General Jackson in taking care of the currency! Here we see a series of Treasury cir culars, which were issued during a period of the last three years, coming up to the present fiscal year almost, all issued by the present Secretary of the Treasury, with the objects avowed on their faces, to make the notes of deposite banks" a convenient medium for circulation in travelling-to extend circulation at a distance-to constitute a safe and convenient and advantageous mode of transmitting funds--to take accounts of exchange operations-to ascertain the geography even of notes received on deposite-to promote measures "highly bene. ficial to the currency of the country"-to raise the denomination of small notes to be issued, in order to circulate specie-to render the currency safe, sound, and uniform, as contemplated by the Constitution-to require the banks to make sacrifices to this policy-to discourage the over-issues of banks-taking trade, commerce, circulation, currency, bank notes, specie, the country, and all that is in it, under the full and complete jurisdiction of the Executive alone. And now, sir, are we coolly told that these measures are not within the constitutional province of the entire Federal Government! This is new! this is false this is flagrant insult added to outrage! this is a total departure, I affirm, from the principles and policy of General Jackson; and that, I suppose, is capping the climax of enor mities with his blind followers! The Federal Government cannot regulate currency and exchange, but it may prevent the over-production of cotton! It cannot regulate currency and H. of Reps. exchange, but it may take into its keeping the consciences and morals of the People! It cannot regulate currency and exchange, but it may pass bankrupt laws to put in durance vile every State corporation of the Union! Such are President Van Buren's first steps in the policy of the Administration. it Sir, this doctrine is so new that the President, throughout this very Message, except in those parts where he is expressly asserting this strange doctrine that the Federal Government has nothing to do with the currency of the country, forgets himself, and contradicts the position from the mere habit of his own mind to conceive the contrary. He speaks of "the em barrassments in the pecuniary affairs of the country diminishing the public revenue so much that the accruing receipts, with the reserved five millions, would not be sufficient to defray the unavoidable expenses of Government, until the usual session of Congress." And is it so, that the embarrassments of the country do thus embarrass the Government, stop its wheels, and yet the Government has not power to do the only thing on earth which can relieve itself from these embarrassments, and perinanently prevent their recurrence-regulate the currency? Did "the difficulties experienced by the mercantile interests force them to apply for indulgence on duty bonds before the suspension ofpecie payments" And yet has the Government, the colection of whose revenue is thus suspended or stopped, no power to afford facilities for the pay. ment of its dues, or no power to secure their payment at all by some system, to strengthen commercial confidence, and enlarge the capacities of trade? Sir, the President himself, I repeat, speaks constantly in this Message, of the policy of Government in relation to the currency of the country, as if there was, and should be, sonte policy of the kind. No one can read his Message, and not see that he contradicts himself, and does not in reality entertain any such novel and absurd opinion as that a Government possessing the powers and duties which this does, cannot take care that there shall always be a safe and sound circulating medium, and a sound condition of commerce and abundant means of trade, foreign and domestic, without which Government debtors cannot be sound or able, and without which the resources of revenue must always be meagre, unstable, or exhausted. What, sir, are the duties of this Go vernment and its powers? Congress shall lay and collect taxes, duties, imposts, and excises; it shall pay debts; it shall make all duties, imposts, and excisca uniform; it shall regulate commerce with foreign nations, and among the several States, and with the Indian tribes, it shall establish uniform laws on the subject of bankruptcies; coin money and regulate the value thereof; provide for the punishment of counterfeiting the secu rities and current coin of the United States; declare war! raise and support armies! provide and maintain a navy! make all laws which shall be necessary and proper for carrying into execution the foregoing powers. And yet, sir, the President says it shall not, it cannot, provide the only means of executing any or all of these powers-the sinews of war, the security of peace-a sound currency for the country! Ay, but he says may demand the "constitutional currency" for the Government! How can the Government demand specie, whilst the people have not specie to pay? Specie is no more a constitutional currency than good convertible paper. The prevision in the Constitution which makes nothing else but gold and silver a legal tender in payment of debts, does not require the Government to exact specie. It is only another provision of that wise instrument which guards thic mode by which Congress shall regulate currency, make it sound by basing it on specie, and make it safe and efficient by being easí. ly convertible. Sir, the fact is, that the Executive has ker. ed and cobbled the currency, until it is past mending. The Ex and the In-President have practised upon its health until the patient has died upon their hands, of their wretched quackery, Now they wish to give up its cure, or its resuscitation, as a bad job. Now their only refuge from political or professional dia grace is in saying it was ever immedicale by Government. After exerting all their power and their skill to make the currency better, now that it has become worse than was ever predicted by the regular practitioners, they insist that they never exerted, and never can exert, any power or skill in the case; for they never had either! Sir, as to power, they had too much to destroy; as to skill, they never had any to reanimate or to restore! God help a patient in such hands! Their want of skill and want of honesty in this case would constitute murder, if the patient were a human being whom they had destroyed, instead of the country and its private and the public interests. Sir, it is impossible for Government not to interfere with the currency of the country. When it ceases to perform the func tions of Government-when it ceases to raise, receive, keep, transfer, disburse revenue--when it ceases to use customhouses and land offices, tax gatherers and collectors-when it disbands its one hundred thousand stye-fed office holderswhen it dismantles its navy, and disbands its standing armywhen Congress ceases to sit, and the President no longer draws his salary-then, and not till then, may he say to the people, pay what you owe the Government in specie, take what you can get from the Government, and get the specie as best you may, Government has nothing to do with the pockets of the people. Sir, you are not willing to bargain with the people to hold hands off; to agree that you will go to them for nothing if they will come to you for nothing. No, sir, if you will not collect yearly from the people some twenty or thirty millions of dollars, and expent more than you collect, they will not ask you to regulate the currency. They ask nothing more; when, where have they claimed of Government to aid individuals in the transfer of their funds," or in the transportation of their merchandise? When or where have they asked Government "to make men rich, or to repair, by direct giants of money, or legislation in favor of particular pursuits, losses not incurred in the public service?" Sir, though the Executive has reduced our people to beggary, by interferring with "individual concerns, most oppressively and cruelly and unconstitutionally, yet have they not come as "beggars" to their own Government their own servants! All they demand is, in the language of this message, "a system of general laws commensurate with, but not exceeding the objects of the establishment of good government; leaving every citizen and every interest to reap, under its benign protection, the rewards of virtue, industry, and pra dence." But, what virtue can now withstand the corruption of "the Government?" What industry can now live under the present system of Government pillage? What prudence can now foresee or calculate the ruinous results of wild expi ments? Virtue is cast to the dogs! Industry is rif,ed and picked! Prudence is baffled, and stands dismayed! In the next place, sir, the President agai, attacks the Bank of the United States. Again is the dead monster pierced, and |