26TH CONG....1ST SESS.

ity may be better; that your agent at New York, where your great interests are, may meet these engagements unembarrassed. Now, when he receives and pays out for you, is it your affair or his? Is it one money for him and another for you, or is it not yours in either case? This is the affair of the people; the Government is their agent.

I would gladly, Mr. Chairman, call my colleagues' attention to the important influence a United States Bank has had, and must always have, on our southern staple and our facilities to elect between alternative markets; also the vastness of the political results that might inure to the South by throwing such preponderating machinery at the North. These are topics grand and overwhelming. But my time is spent, and I desist.

I have endeavored to present fairly the merits of this bill. That I have succeeded, it would be vanity in me to suppose; but I desire it to be remembered that the great good to be effected by it, in my estimation, is to limit the revenue to the wants of the Government, making it as simple and economical as a republic ought to be; to close up the innumerable avenues to indirect executive patronage, and thereby limit his power to that which is given and lawful to be exercised; thirdly, to check the alarming tendency of Federal legislation to adopt a rule of construing the supreme law, by which its decisions, concerning its powers, ride over the supremacy of that law. If I have contributed to this, I have sustained the interest of my constituents, my own, and the interests of the country; I shall have cause to be satisfied with what I have done, and will rest on a "conscience void of offense.

دو

INDEPENDENT TREASURY.

SPEECH OF HON. C. SHEPARD,
OF NORTH CAROLINA,

IN THE HOUSE OF REPRESENTATIVES,
June 13, 1840,

In Committee of the Whole on the state of the Union, on
the bill to provide for the collection, safe-keeping, trans-
fer, and disbursement of the public revenue.
Mr. SHEPARD said:

who support this bill. If its effect on the currency would be wholesome, its passage is still more desirable; but I view it principally as an engine to manage the national revenue, and I am the more anxious for its success, because it obviates the necessity of a measure odious to the people and destructive to the harmony of the country. Sir, I do not belong to that school of politicians, who, under the cloak of doing one thing, are aiming at another not sanctioned by the Constitution. "An honest man will not cheat his neighbor, neither will he commit a fraud in the Legislature of the Union for the triumph of party, or the still more despicable purpose of taxing one portion of the people for the advantage of another.

robbers; that the President will have the power
of an eastern potentate, and that the "credit sys-
tem, the source of all our prosperity, will be
overthrown, and this flourishing country revert
to its pristine barbarism. These are the exagger-
ations of heated zeal and distempered fancy.
Hatred of the party in power has blinded honor-
able gentlemen; hope, which has so often tanta-
lized them with the prospect of success, and has
been so often disappointed, has filled them with
intemperate ardor and made them forget that the
minds of others are not subject to the same ob-
struction. The hackneyed politician, whose sole
object is to attain success, and the paid advocate
of special interests, will use every means to ex-
cite the public feeling and delude the public judg-
ment, but it is matter of astonishment that high-
minded statesmen should fall into such extrava-
gances. I doubt not the sincerity of other honor-
able members, but after an earnest investigation
of the merits of this bill, and after tearing from
my heart every prejudice which might lead me
from the path of truth, I feel assured that the
success of this measure will be of lasting benefit
to the Government, the country, and all its inter-people and the Constitution. Can it be that the

ests.

The bill proposes that the public revenue shall be kept by the public officers, by men appointed for that purpose according to the laws of the land; and it forbids the receipt at the Treasury of anything but gold and silver, the legal currency of the country. These simple principles are the essence of the measure, and on them will depend its usefulness and efficiency, either as a fiscal agent of the Government or in its incidental bearing on the industry of the Union. Gentlemen have said that they are contrary to the genius of our institutions, that they are more congenial to the despotisms of the Old World, and more in unison with the habits and feelings of an enslaved people. To test the truth of these assertions, let us go to the fountain of our legislation, whose pure and living waters are yet refreshing to the patriot and statesman-to the Constitution itself. That instrument authorizes the President and the Senate to appoint subordinate officers to assist in managing the affairs of this Government. It says nothing of corporations; and the inference that its authors intended to impose all the duties arising under the Constitution on persons selected according to law, and liable to its penalties, is not unreasonable. Congress has power to "coin money," and the States are forbidden to "emit bills of credit," or to "make anything but gold and silver coin a tender in payment of debts;" but no mention is made of bank paper, no author

Mr. CHAIRMAN: The few remarks which I intend to make will be strictly applicable to the bill under consideration. Honorable gentlemen have wandered to other topics which have but little connection with this subject; they have traveled over the old ground, so well known to the members of this House; they have rehearsed the story of the war upon the banks, and indulged in the usuality is given to make use of the promissory notes tirades against the persons engaged in that famous controversy. A member from Kentucky has affirmed that this question was to be decided by authority, and, charging certain eminent gentlemen with having changed their opinions on the subject of the currency, he supposed this fact to be a powerful argument against the bill. Sir, I differ entirely from that honorable gentleman. Politicians may change with the moon, but their conduct should not arrest the progress of great and valuable principles. The human mind is so much influenced by prejudice, so often governed by circumstances, and is so circumscribed in its vision, that the best and wisest are liable to error. Must we, therefore, ever continue in the wrong, and must we never yield to the lessons of experience? Mr. Van Buren was in favor of the "safety-fund" system of New York, and Mr. Calhoun once advocated the establishment of a national bank; but do these things justify the assertion that they are dishonest in recommending this measure; or are they sufficient to draw you, or me, or any honorable member, from its zealous support? Sir, I think and act independently on all occasions. The people whom I represent are too proud and too generous to expect a base subserviency to any man or any party; all that they wish is an honest devotion to their welfare, and a conscientious discharge of the solemn duties required by the Constitution.

Sir, if this bill contain in its womb but a small portion of the evils which its enemies have foretold, it is the worst measure ever introduced into a deliberative assembly. We have heard that the public treasure will be surrendered to thieves and

of private associations, and it is not illogical to
suppose that our fathers endeavored to establish
a hard-money Government. There were banks
in this country and in Europe when the Federal
Convention was in session; the convenience of
these institutions was known and understood by
its members, and their silence is unaccountable
if corporations be so necessary for the keeping of
the public money, and if the demand of gold and
silver be so hosule to liberty and social improve.
ment. I am not saying that we are forbidden to
receive paper and to deposit it in banks, but I
wish to show that this bill is not incompatible
with the Constitution; indeed, I consider it in
strict accordance with its spirit-a faithful per-
formance of the wishes of its framers, who never
dreamed of the interpretation of modern commen-
tators. Here, then, I might stop, and ask our
opponents for their authority. The burden of
proving the measure inefficient or dangerous lies
on their shoulders, and something more than loud
denunciation is necessary to satisfy the public
mind.

An honorable member from New York [Mr.
BARNARD] said that the real object of the bill was
to "govern" or to "regulate" the State banks,
though its title was "A bill for the collection,
safe-keeping, transfer, and disbursement of the
public revenue." He thought it analogous to the
tariff laws, which were passed for the benefit of
domestic manufactures, while they were called
acts for the collection of revenue; and he seemed
to think it difficult for some of us to "digest" a
measure of such a character. The gentleman is
entirely mistaken, at least in regard to one of those

But gentlemen are distrustful of individuals; they think that corporations alone are safe depositaries of the public funds. A single person is fit for the Presidency, though the destiny of fifteen million people is placed in his hands; a judge on the bench must decide questions involving the lives and fortunes of his fellow-citizens; and each one of us is trusted with the performance of great and solemn duties to the

President and the Senate would be unable to find men sufficiently honest to take charge of a few dollars and cents? If there be so little integrity in the country, why do these moneyed institutions themselves put confidence in their officers and directors? How was the public money kept during the war of the Revolution, when there were no banks in existence? Other nations use individual depositaries, yet there is no complaint of loss, no absolute necessity of changing their system. Greece and Rome carried on their mighty conquests, and filled their exchequers with the spoils of the world, and their treasure was confided to the care of individuals.

Gentlemen are willing that the revenue should be collected by the officers of the Government, though the keeping of it must be committed to private associations. It is not easy to see the distinction; if men are too worthless to be trusted with the latter duty, it is unwise to allow their interference for any purpose, and banks should measure boxes, gauge molasses, sell land, and saunter about the country as regular tax-gatherers. The case of Swartwout illustrates this view of the subject; his defalcation occurred during the connection of the Government with the banks, and while the public officers were ordered to collect and deposit in these institutions. Yet this did not prevent the embezzlement, for if a man be disposed to cheat he has ample opportunity dur ing the process of collection. The truth is, that whether banks or individuals be the depositaries, the Government is equally exposed to loss; the only safe rule is to select trustworthy men, to keep a vigilant eye over their conduct, and to infict the heaviest penalties on negligence and dishonesty. This bill goes far to place guards around the public treasure; should, however, fine, imprisonment, and future disqualification for office be unavailing, let the whipping-post and the gibbet drive men into the paths of rectitude.

of

But, sir, I will proceed to a topic of still greater importance. It is pretended that the power the President will be increased by the provisions of this bill, and the patriotic sensibilities of gentlemen are aroused by the idea that the Commander of the Army and Navy, and the leader of forty thousand office-holders, should also have control of the Federal purse. The zeal of these animated orators would encourage the belief that public liberty was in danger, and that the Presi dent was grasping at all the powers of the Constitution in order to change the nature of our Republic.

A plain statement will dissipate these clouds and relieve the anxieties of honorable gentlemen, if they are sincerely in search of truth and not playing the game of petty politicians for selfish purposes. If the Government and the banks be connected, the public money will be deposited in these institutions, subject to the drafts of certain officers, in pursuance of old and established laws. Whether it be a bank chartered by Congress or a State Legislature, the keeper of the money is compelled to obey the command of these officers; it cannot be said that the fund is to be used for an improper or illegal object; the depositary cannot

inquire into the motives and designs of the public
agents, though it be suspected that they are wast-
ing the treasure of the nation, but drafts in the
legal form and from the proper authority must be
promptly paid. It thus appears that the revenue
of the country must be under the control of some
one, and existing statutes have placed it under
the care of officers in the Department of the Treas-
ury; they have it deposited in banks, they draw
it out according to the exigencies of the public
service, and on their intelligence and integrity we
rely for a faithful discharge of these important
duties. Now, sir, the President appoints these
officers, and, from the construction put on the Con-lations of private individuals. If one man has
stitution since the days of Washington, he can
remove them at pleasure; if they thwart the plans
of ambition, if they refuse to be the tools of cor-
ruption, or if they decline to use the public money
for any purpose which the President may dictate,
he can eject them from office, and substitute in
their stead men of more pliant and less scrupu-
lous character. This might happen under a Chief
Magistrate who could have the folly to attempt a
stretch of authority, if we resolve to keep this
Government and the banks united. Would our
situation be different if this bill becomes a law?
The officer in charge of the public property might
be cajoled by his superior or driven to a violation
of his oath and his duty to the country; through
him the President could bribe dishonest politicians
or raise a secret army to war on the rights of his
fellow-citizens, or use the nation's money to grat-
ify still lower propensities. Thus, in either case,
whether banks or individuals be the depositaries,
the President will have an indirect control of the
public money so long as the power of removal
from office is admitted, so long as subordinates
must depend on the smiles and favor of the Chief
Magistrate.

The most prominent measure of the late Administration proves the truth of this argument; the Secretary of the Treasury refused to obey the President and remove the deposits from the Bank of the United States; he was displaced, and his successor readily executed the mandate of his superior. Shame, then, on this hypocritical clamor against the great measure of reform! Where is the proposition to increase the power of the Executive? Where is the clause by which he can exercise more influence than at present? This attempt to deceive the people is worthy of scribbling partisans and traveling orators; it ought not to appear in this House, where we should assemble and deliberate like dignified statesmen. If gentlemen are fearful that the President may exercise an improper influence on the Department of the Treasury, the only way to remedy this evil is to affect an amendment of the Constitution; and to make that Department directly responsible to the Representatives of the people. A proposal of this nature would involve grave considerations; it might be feared that the Chief Magistrate would be rendered weak and inefficient, or the Secretary of the Treasury himself become too powerful, or the Legislature would engross too much authority and trample under foot the coordinate branches of the Government. But the passage of this bill cannot be an obstacle to any change which may be desired by the wisdom and patriotism of the country; the question now at issue concerns the keeping of the public money, and whether it be placed in banks or in the hands of our own offcers for safety and disbursement, the ultimate control of it may be given at any time to whomBoever the voice of the nation shall direct.

The management of the "independent treasures" will require the appointment of a few more officers and clerks, and to this extent the patronage of the President must be increased, but it will be shown, in the progress of my remarks, that this is trifling in comparison with that which will be lopped off by separating the banks from the

Government.

But, Mr. Chairman, the strongest feature of this bill is that denominated the "specie clause," which orders the revenue to be collected in gold and silver. This provision will go into operation gradually to avoid the injurious consequences of a change too sudden, and to enable all classes to accommodate their affairs to the future condition of the currency. The enemies of this measure have denounced it as a scheme to prostrate the

HO. OF REPS.

probable that the sum above mentioned must be supplied by the banks, and they should be prepared for this additional demand for the precious metals. By the last report these institutions had $33,000,000 in coin, and upward of four hundred millions in debts, while they owed much more than one hundred millions to the community. Can it be possible that corporations so rich, and having such entire control of the business of the country, are unable to redeem $5,000,000 of their own notes? Or is it reasonable to suppose that their usefulness would be destroyed by the refusal of the Government to use their paper? Sir, these professed friends of the banks are their worst enemies; they have done more injury to paper currency by prating about its weakness, and dragging the subject into politics, than the most frantic bullionist could effect by argument. I think better of these institutions than their political allies. I believe they are perfectly able to answer the call made by this bill, and if they are not, they would soon fall without the help of external violence.

banks and the credit system; the demand of coin
is considered a discrediting of paper issues and
the complete overthrow of the present order of
things, and thence they have launched into a swol-
len eulogium of the glorious advantages of credit.
The error of honorable gentlemen consists in not
discriminating between a standard of value and
currency and credit. Every Government is bound
to furnish its people with the former, and every
Government has performed that duty; but, as to
credit and currency, these have generally been
left to those engaged in business; and it is now
proposed that we shall not interfere with the re-
earned more than he needs the surplus is loaned
to another, on whose industry and integrity he
can depend. Money is lent and borrowed from
a sense of mutual interest; this has been the case
from the time of Adam, and will continue to the
end of the world. Is there anything in this bill
to discourage men from using their own prop-
erty or making such contracts as their interests
may dictate? Is there a clause prohibiting individ-
uals or corporations from loaning and borrow- But it is said that if the Government refuses
ing money or receiving the promissory notes of paper the people will follow its example, and in
whomsoever they may be willing to trust? The the general distrust nothing but coin will be re-
Federal Government is forbidden to treat paperceived with satisfaction. This result is not prob-
as money, not for the purpose of dishonoring able; so long as paper is convenient for commerce,
that which circulates, but because it should not and so long as it is redeemed promptly by those
discriminate between its citizens by using the who issue it, the thunder of Washington will be
promissory note of one and refusing that of an- felt no more than a popish bull. The greater
other, and because the interest of the whole so- governs the less, and the hundreds of millions
ciety will be promoted by adopting a new policy. used in the business of this vast and enterprising
Sound credit is a powerful agent in the produc- country cannot yield to the small dealings of the
tion of wealth and the advancement of individ- Government; the thousands who throng the ave-
ual happiness; but gentlemen are greatly mis- nues of commerce and congregate in the busy
taken in supposing that the extravagances and
marts will consult their own interests and con-
corruptions of the banking system have pushed venience and not the wishes of politicians. Gen-
this country so rapidly in the career of national eral Jackson and his party were charged with
prosperty. The fertility of a virgin soil, hith- endeavoring to destroy the late national bank;
erto untouched by the plow-share, the enter- and yet it became stronger among the merchants
prising spirit of our people, which no difficulty and traders, because they believed it to be sound;
can subdue, and the unfettered liberty enjoyed usefulness and safety being the tests which gov-
under our free institutions, have caused the won- ern the opinions of prudent and practical men.
derful development of the resources of this highly A few years ago the State of North Carolina for-
favored land. But, sir, let us take a view of the bade its officers to receive notes under five dol-
practical operation of this measure. One mem- lars, and made their circulation penal, and yet
ber declaims loudly on the benign effects of pa- they came from the adjoining States, temporary
per; another theorizes on the benefits to be de- convenience triumphing over principle. Gentle-
rived from gold and silver. I shall endeavor to men need not fear that confidence will be de-
discover the real influence of this bill on the busi-stroyed; the danger to be apprehended is too little
ness of the country and the character of our insti- suspicion, too much dependence on the honesty
and intelligence of the money dealers. The office
of currency is to present a uniform standard of
value, and furnish the means by which commod-
ities may be exchanged and contracts regulated.
In this country it is mixed, composed of coin and
paper, the last greatly preponderating. The re-
lations of business demand, and will have, a suf-
ficiency of this circulating medium; the refusal
of paper by Government will alter the propor-
tions heretofore existing; there will be more spe-
cie and less paper; more of the substantial and
not quite so much of the convenient; more strength
and a little less activity.

tutions.

If the coin paid to the Government be hoarded
up, great distress would certainly be produced
throughout all classes of the community; but it
is levied for the purpose of being used; it comes
from the pockets of the people into the Treasury,
and it will go to the public creditor to defray the
expenses of Government. The head of a family
may spend thousands of dollars, and yet rarely
have, at the same time, more than a few hun-
dreds; his affairs are so managed that his expend-
iture keeps pace with his income, care being
taken to provide for any contingency that may
reasonably happen. Thus it is with the Federal
Government; its revenue is constantly accruing,
and passing away in a similar manner, unless an
Administration should have the madness to col-
lect more than is wanted for necessary purposes.
It is impossible, however, to expect an exact cor-
respondence between receipts and expenditures;
one or two millions are required for the Mint, and
allowance must be made for casualties, so that
the Treasury will always have a considerable
sum above its immediate liabilities. Persons well
acquainted with the details of finance (and the
calculation is easily made) have supposed that
$5,000,000 would be the amount usually in the
hands of public officers. Whatever may be the
annual income, this will be the extent of the de-
mand for Government, and the remainder will
go into circulation, or return to the coffers from
which it came. When the system becomes es-
tablished its operations would be regular, and
banks, merchants, and men of business, will con-
duct their affairs accordingly; the dealer in money

will soon learn to foresee the amount of specie
that may be called for, as also that which will as-
suredly come back to his vault by the course of
trade, and thence may be known his ability to
accommodate customers and borrowers. It is

When the public funds consisted of promissory notes, and were deposited in banks, they formed the basis of new loans, and in some cases were used as capital, though in reality they were the simple obligations of these institutions themselves. If, instead of having this deposit, they be called on to redeem $5,000,000 of previous promises, it is not astonishing that all interested in large issues should be violently opposed to this bill. According to safe practice a banker can lend in paper three times more than he has in coin; and if he lose the advantage of the Federal revenue, his circulation will be curtailed probably to the amount of $20,000,000. This result may be unpalatable to the receivers of dividends, and to those whose prospect of wealth is dependent on heavy loans and endless credit; but in placing a moderate and wholesome check on the manufacture of paper, this bill confers a great benefit on the people, who are deeply concerned in the maintenance of a sound and steady currency.

The history of banking shows a constant proneness to overaction; the anxiety of the stockholder to make large profits, and the greediness of the borrower, who too often is a mere speculator, seduce all parties beyond the limits of prudence. The former thinks that the demand for his notes

26TH CONG....1ST SESS.

is caused by the business of the country, and the latter imagines the supply to proceed from real, active capital. This may be true to a certain extent; but as the paper increases the price of property rises, and, reacting on the banks, induces greater expansion. These alternate influences continue to operate until the condition of things is entirely artificial, the trading men being deeply indebted to the banks, and these utterly unable to redeem their obligations. While the flood is going on it is easy and agreeable to glide in the current. High wages, high prices, and plenty of money make us rejoice in the prosperity of the country; but when there is a reflux of the tide, and debtors are called on to pay, unrewarded labor, the sacrifice of property, and "hard times," mark the period of contraction. Self-interest is the guide and counselor of these trading companies. The object of the capitalist is not to furnish a good currency to the people, but to make a profitable investment of his money. If it be advantageous to extend the business, it is done without caring for the soundness of the circulating medium; and if it be necessary to "stop accommodations," the decree goes forth amid the groans and sorrows of a ruined community. In many cases, cunning and unscrupulous men creep into the command of these institutions; they act for the benefit of themselves, their friends, and confederates, regarding neither the interests of stockholders nor the welfare of the country. Such persons are worthy of the gallows. But if the managers of the system be honest, and disposed to do their duty, how can they avoid the periodical crises under which we suffer? Where is the index to point out the limit of issues, beyond which it were unsafe to go? Who can tell when the demand for paper ceases to be natural, and the cravings of a morbid appetite begin to operate?

port all the merchandise that was to be carried, at Charleston took the paper of a local bank, it
at a fair price, the usefulness of both would be was deposited in the branch of the national insti
diminished, and a portion of the expenditure tution, whose manager immediately demanded
would be a loss to the community. If $50,000,000 payment, which was effected by means of specie
be able to keep in motion the plow, the ship, or a draft on Europe. This Government would
and the shuttle, and perform the contracts of trade,
not touch the notes of State banks, except for a
what good could be obtained by doubling this moment, to suit the temporary convenience of the
sum? Money would be depreciated, and all kinds citizen, but it gave strength and circulation to the
of property would rise in the market; corn might issues of the great mammoth. How, then, can
be sold for six dollars instead of three, but the the passage of this bill injure the State corpo-
farmer would pay in the same proportion for land rations? Under no circumstances can they be
and labor, for the comforts and luxuries of life, benefited by the receipt and disbursement of the
and for the education of his children. In a coun- Federal revenue. In addition to this, the paper
try where improvement is constantly going on, of a national bank would find its way to the chan-
where new lands are opening, where cities are nels now occupied by that of the local institutions.
building, and the mechanic arts are rapidly ap- || Having the advantages which would be conferred
proaching perfection, there must be a gradual in- by law, and the credit which would be given by
crease of the currency, but it should be according the countenance of Government, it would be a
to the wants of business, not the caprice and self- favorite with the public, and perform much of the
ishness of individuals. Gentlemen need not fear duty now devolved on its rivals, and, of course,
a deficiency; if trade be left to itself, if bankers reap the best of the harvest. The friends of the
be put on the same footing with other industrious national bank are, therefore, the enemies of the
classes, if credit be free as the air of heaven, the State corporations. The refusal of paper in this
circulating medium will be adapted to the capa-
bill will be a wholesome check on its issue, but
bilities of the country, to its varied industry, and we do not also present a competitor in the mar-
gigantic enterprises.
ket for the business of the people.

Honorable members are addicted to being elo-
quent when speaking of the happy effects of a
swollen currency. The poor young man, start-
ing into life with no capital but his moral quali-
ties, the hidden resources of the country brought
to light and ministering to our greatness, the high
wages which carry solace to the wearied laborer
and his humble family, are topics on which they
disport in their peculiar strain of declamation.
Why will they not sometimes view the dark side
of the picture? Why will they not notice those
periods of our history when the banks are re-
tracing their hasty steps, when the price of all
articles is brought down, when labor is almost
It is said that the foreign exchange is the test- worthless, when the debtor is pressed to the earth,
that, if specie be exported, the currency is re- and one universal cry of distress pervades the
dundant and should be contracted. This is a land? Between the years of 1816 and 1821, dur-
remarkable principle; the evil has occurred, and ing the existence of the late national bank, fifty
the community is injured, though the banker millions of paper were drawn from circulation;
may moderate the mischief by listening to the previous expansions had created the heaven in
warning received from countries across the water, which the gentlemen delight, but the banks were
that have a sounder currency. Should it happen, forced to call on their debtors in order to sustain
however, as is the case in England, that the for- their own credit, and thence began the fall of
eign nation, with which we have dealings, has prices, the destruction of property, and the de-
also expanded her circulating medium, the state rangement of business so well known to those
of exchanges will not indicate the disease; or if acquainted with commercial affairs. Since that
we borrow large sums of money from European time similar events have occurred, though not of
capitalists, the test is completely destroyed; in- a character so disastrous; and now we are in the
deed the rate of exchange would be in our favor, midst of a paper revolution, unequaled for its
and yet we might be gasping from a plethora of extent and appalling consequences, crushing the
paper. Sir, so long as companies, organized for merchant, embarrassing the artisan, and depriv-
private purposes, and pursuing private objects, ing the laborer of the common necessaries of life.
have the entire control of the currency, and are Can these fluctuations benefit any class of the
assisted by the funds and power of the Govern- people, or advance any species of industry? If
ment, so long will the standard of value be ren- we are pushed forward by expansion, we are
dered uncertain, the condition of our citizens fluc- dragged further back than our old position by
tuating, and their best interests placed in constant contraction. This country does not need an ar-
jeopardy. It is ridiculous to ask a remedy of tificial stimulus; the spirit of our people is not
those who are thinking only of themselves; these broken by the despot's frown; the reward of in-
corporations have received their privileges from dustry is tempting beyond example; the field for
Government, and all that is now asked is to di-enterprise is rich and varied. The fear is that we
minish, in a slight degree, the dangerous monop-
oly. The refusal of paper at the custom-house
and land office will remind the banker that he is
liable for the payment of his notes; he will be
called on daily for the precious metals, and he will
become more scrupulous in the use of his credit.
I am not sanguine in the hope that this measure
will produce a complete reform; it will certainly
abate the evil, and the Federal Government has
not authority to do more. If these abuses con-
tinue to afflict the country, the power of the States
must be invoked for a correction.

A learned member from Massachusetts [Mr. CUSHING] Seems to think that the prosperity of a country is commensurate with the quantity of its circulating medium. If the currency be something valuable, its increase is undoubtedly an evidence of industry and enterprise, but considered as a mere instrument of commerce, as a means to effectuate a particular purpose, as a measure of value and exchange, its excellence depends on its efficiency for the desired object. A railway between two large cities may be useful and profitable; but if another be constructed, though the former could convey all the passengers, and trans

may advance too rapidly, that our strength will
not be equal to our growth, and that we may be
wanting in those great qualities of virtue, stabil-
ity, and moral excellence which elevate and adorn
a nation.

Some gentlemen have been seized with a won-
derful regard for the institutions of the States;
lips which have poured, forth scorn and derision
upon the doctrine of State rights have lately used
most honeyed phrases, and invoked the South to
interfere and reject a measure that will destroy
their local banks. Sir, the real object of this pre-
tended sympathy is to play on the feelings of hon-
orable members, and use them to advance a meas-
ure condemned by our constituents, and utterly
repugnant to their interests; the hope is to destroy
this bill, and establish a great national bank,
which is so friendly to the States, and so little
hostile to their own corporations!

Let us compare the effect of such an institution with that of the Independent Treasury. According to the act of 1816, the officers of the revenue received the notes of any bank which paid specie at the place of reception, or the notes of the national bank payable anywhere. If the collector

Mr. Chairman, one of the strongest arguments in favor of this measure is its tendency to introduce stricter habits of economy, and to make the people understand any malversation which may occur in the conduct of their affairs. In 1824 and 1828, under the pretense of collecting revenue, laws were passed imposing heavy taxes on the people of this country, for the purpose of protecting domestic manufactures. I shall not descant on the subject, but will merely remark that these enactments were considered unjust and oppressive by those who did not participate in the bounties granted; they were contrary to those modern principles of philosophy which teach that commerce should be free and industry unrestricted; they were in violation of the spirit of the Constitution, which forbids that the Government should be prostituted to the interests of a particular class or section of this wide-spread Confederacy. Under their operation large sums of money were collected from the people which were not necessary for the public service; in a short time the national debt was liquidated, as if the present generation alone should pay the price of our liberties, and the most ridiculous, expensive, and unconstitutional schemes were projected to absorb the revenue, and yet there was a surplus in the Treasury of $40,000,000. Sir, does the history of England or France, or even Turkey, exhibit a policy so unjust and foolish? Monarchs have taken the property of their subjects to carry on war, by which their ambition might be gratified, their territories increased, and their families enriched; but in this Republic, established for the benefit of the whole people, whose ancestors refused to pay King George a small tribute, we have an instance of levying more taxes than are wanted, or could be wisely spent! This fund was deposited in the banks, which loaned it out to the real owners at an interest of six per cent., and kept them from feeling the burden that had been imposed; but finally the authors of this miserable system of duplicity and plunder, to conceal the enormity of their conduct, proposed that these millions of dollars should be distributed among the States. Thus trading politicians, combined with the representatives of selfish and grasping interests, passed laws for the benefit of the few at the expense of the many, and, when the result of the policy began to be manifest, a cunning scheme is devised to blind the eyes of the country, by returning the money which had been improperly seized, and by endeavoring to have it believed that this Government was a paternal benefactor. Sir, do you think that the juggling conspirators could have consummated the plan of deception if the revenue had been paid in gold and silver and been kept by the public officers? If $40,000,000 in coin had been accumulated in the Treasury, every branch of industry would have suffered so intensely that the people would have seen the real nature of these hypocritical enactments, and with one voice, from Maine to Louisiana, demanded a repeal. Such is the beautiful operation of this measure, that the Government and banks are made to exert on each other an indirect but wholesome influence; the

26TH CONG....1ST SESS.

demand for specie will tend to keep the issues of paper within proper limits, and unjust or improvident legislation will receive a sure check from its bearing on the moneyed interests of the people.

Independent Treasury-Mr. Shepard.

who will always have private interests in view,
and secret objects to attain? When gentlemen
talk on this subject, they should distinguish be-
tween the exchange of equal values and the ex-
change of banker's paper. There is no difficulty
about the first, and as to the various depreciations
of the last, these must be corrected by ceasing to
screen them from the penaltics of the law, and by
the stern sense of an honest community.

But, sir, we are told that a corporation of large
capital, chartered by this Government and sus-
tained by its revenues, would furnish a paper me-

sues of State banks, and prevent those expansions
and contractions of the currency that so often con-
vulse the country. I grant that the powers of
such an institution, wielded with prudence, wis-
dom, and patriotism, would produce a happy ef-
fect, and if such qualities were often found among
men, the State corporations themselves would not
require a master, but would perform their duties
faithfully. What reason have we to think, how-
ever, that more virtue, good sense, and love of
country, will be found in the managers of a na-
tional bank than in those of the State institutions?
Will not the offices of each be distributed by in-

Mr. Chairman, I have been amused at the various and contradictory objections which have been made to the passage of this bill. One member tells us that most of the coin will be collected at New York, and it must be transferred to different places where it may be wanted by the Government, and thence it will return by the course of trade to the city from which it came. He concludes, therefore, that specie will be travelingdium equivalent to specie; would control the isabout the country and keeping commercial affairs in constant agitation, as if drafts payable at the depository in New York and sent to St. Louis, for instance, would not be readily cashed by merchants or bankers of that city who stand in need of eastern funds, and thus prevent the movement of a single dollar. Another member opines that a great bank is to be erected, where all the specie of the country will be hoarded and paper will be issued to take the place of our present currency, as if this bill countenances or approves of any such project, or does not contain provisions which a fair and honorable statesman would consider utterly hostile to the life of a monster so obnox-trigue and favoritism? Will not all be equally ious. A third gentleman is stuffed by his leaders with both these ideas; and not perceiving their inconsistency he pours them forth with all the gravity of conviction, and congratulates himself with having dealt a heavy blow on the Independent Treasury and its supporters when his simplicity has only excited their pity and laughter. Sir, honorable members are compelled to resort to their old tactics. Overthrown in argument, they create men of straw of vast dimensions and bad propensities, against whom they war most lustily, or charges of corruption and imbecility are made against the Administration, which finally sinks into the awful crimes of buying a few flowers, or eating with a silver spoon, or using a cambric handkerchief. The object of this virulent slander and petty persecution is to divert the public mind from the real issue, to keep the people from considering the great questions which they are called decide, and slyly elevate a party whose heart's desire is to establish a national bank.

The beauties of such an institution have been often portrayed to this House, and to the country. A circulating medium at par throughout the Union, domestic exchanges regular, and at a small charge, the State banks compelled to redeem their issues these are the boasted blessings to be conferred by a national bank! It is certainly convenient for travelers to have a paper currency, that will be received in all the States; but they constitute an exceedingly small part of the community, and the trouble of taking a few gold pieces would save them from the loss and annoyance of using the notes of local corporations. This advantage is also counterbalanced by another consideration: it is not the ability of a national bank, or the skill with which it might be managed, that gives a general currency to its bills, but the Federal Government receives them in payment of dues, and thus gives them credit in sections far distant from the place of redemption. Were the note of any bank or an individual stamped with such an authority, it also would go everywhere and be eagerly sought after. The granting of this favor to a special association is a great monopoly, and can only be justified by the overruling law of necessity.

Exchange between two points depends on the business of commerce, on the productions sold and the merchandise purchased, and on the relations subsisting between them as debtor and creditor. Natural causes, therefore, govern exchange, and if there be no tampering, no interference by the Legislature, it will always be on a proper footing. Nobody complains of exchange between New York and Liverpool, and merchants would think it ridiculous to speak of regulating it by a bank; for it is rarely much above or below the par standard. If a trader in New Orleans had $1,000 to pay a debt in Philadelphia, and a draft could not be bought on fair terms, he could transport the money by water at the small expense of one or two per cent. This is done in all parts of the world, and where is the need of an artificial ruler,

HO. OF REPS.

peal from those with whom they have no sympathies of feeling reach their hearts and influence their conduct? Cold and calculating, they might sweep from existence the State banks, established to foster the dawning commerce of our ancient sovereignties, and create a dependence on themselves throughout this extensive empire. They might concentrate the trade of the country at particular points when the wishes and welfare of those whose industry has brought it into existence would give it another direction. Sir, can I vote to place the happiness and the prosperity of my constituents at the command of strangers, who know them not? Can I give to a few bankers the control of their commerce and the regulation of their industry? Should I become the servile instrument of cunning politicians, who, having national words on their lips, are entirely governed by local feelings, and assist in sacrificing my own home and my own friends to pamper the pride and increase the wealth of the people of other sections? No, sir; let this Government be separated from all banks; let it raise aloft the standard of the Constitution as the guide of the country and the protector of the people; let it warn men of business from the shoals and quicksands hid under the smooth current of unsound credit; let it be the signal of safety in the hour of distress, the solid bulwark of national honor amid the rage of disastrous speculation and the petty tricks of temporary expediency!

The enemies of this great doctrine have endeavored to degrade it into a mercenary scheme for the benefit of the public officers. This view is more consistent with the narrowness of their own minds and the bitterness of politica! feeling than the important consequences that will flow from its adoption, either to the advantage or the injury of our descendants. My own opinion is, that the connection which has existed between the Government and the moneyed class of our citizens was corruptive of both. It did not advance the permanent interests of society, and if prolonged might so change the character of our institutions as to render profitless the blood and treasure that were expended in their establishment. This subject has caused all the strife and turmoil that have made the last eight years so memorable in our history. The party in power refused to recharter the late national bank, whose stockholders immediately threw themselves into the arms of the Opposition, and the question became the prominent topic of political controversy. General Jackson was charged with designing to tamper with that institution; and he retorted with ac

desirous of large dividends? Will not all be
closely importuned by needy borrowers and rest-
less speculators? Where is the test of sound
operations that will be accessible to the one and
not to the other? Why should the President of
the great company heed the signs of a coming ||
storm and prepare for its fury more readily than
his humble and weaker brethren? Sir, the truth
is manifest, that the same tendency to overaction
pervades the whole system, the same liability to
err, and the same want of means to avoid the fatal
consequences of mismanagement. Great Britain
has a national bank of immense resources, and
yet, from 1797 to 1823, that corporation could not
redeem its own notes. Within the last twelve
months it has been on the verge of suspension,
having been saved by borrowing millions from
France; and so far from controlling the small
banks, her directors have charged the late disas-
ters on those companies. Behold, too, the Bank
of the United States, that has attracted so much
attention during the last few years! Was the
paper currency sound, stable, and worthy of con-
fidence from 1816 to 1821? Have there been no
sudden expansions and contractions, at one time
maddening the public mind with the exciting
stimulus, and at another destroying the hopes and
blighting the prospects which a selfish policy had
caused to spring forth? Let the merchant, let thecusing the bank of using its funds in operating
honest citizen, answer at the bar of his country.
Where now is this great institution, the model of
finance, the cynosure of all eyes, the everlasting
topic of eloquence and declamation? Almost in
a state of hopeless bankruptcy, the pity of its
friends, and the scorn of its enemies. Ought this
to have been its condition at the end of a long
career, if there be so much magic, so great safety
and excellence in a national institution? Where
were the skill and wisdom of its directory, the
sagacity which could penetrate into the future;
where the lofty bearing of strength and confi-
dence? Sir, have they passed away in the energy
that marked the progress of a bold and violent
warfare?

Whatever force may be in the statements of
honorable gentlemen as to the usefulness of their
favorite measures, is weakened by the fear that its
privileges might be exerted to the detriment of
the country. We have a diversity of climate, soil,
and population. One State is agricultural, an-
other manufacturing, a third commercial, or there
may be rivals in the same pursuit. And is there
no danger that an institution of great power might
be prostituted to sectional purposes? A charter
granted to-morrow would aggregate capital from
all parts of the trading world. It would soon
belong to foreigners and vagrant natives, and
it would be controlled by a few merchants and
brokers of New York or Philadelphia. In these
men would be united the money dealer and the
local partisan. Profit would be the first object,
and the aggrandizement of their city or section

the next consideration. Would they care for the
well-being of a distant community if it came in
conflict with their own interests? Would an ap-

on the public mind. Members of Congress and men of influence received loans or high compensations for service, which were stigmatized as bribes, and the varying state of the bank's discounts was said to be without reference to the business of the country, and intended to produce panic and upeasiness throughout the land. The removal of the deposits was proclaimed an act of tyranny, and defended as necessary to curb a bold and intriguing corporation. The substitution of the State banks to keep the public money was hailed as a deliverance, while the Opposition considered them mere political machines, brought up to aid the policy of a corrupt Administration.

I know nothing of the truth of these charges and criminations, though to this day they are believed by thousands of honest and intelligent citizens. The secret doings of factions, and the private arrangements of public men, can never be fully understood; but in matters of this kind, a well-grounded suspicion is sufficient for an argument, and patriotism bids us to be ever watchful in guarding the purity of our noble institutions. An association of capitalists prays for the grant of extraordinary privileges, even the power of controlling the commerce, regulating the industry, and valuing the property of fifteen million people. This is refused; and is it unreasonable to suppose that these men would use uncommon efforts to attain their objects? Would they scruple to form an alliance with needy politicians, that were in search of new weapons to attack their adversaries? Would they hesitate to work zealously in the cause of a party whose elevation will redound to their own personal advantage? Or, let us suppose that an ambitious