these banks; for it caused their notes to United States in excluding the local banks be taken out of circulation, and to be pre- from all connection with the Government, sented to them in masses for immediate and they support the local banks in resistpayment. Thus the great mass of the banks ing the Government of the United States were peremptorily excluded from all re- in proposing the very same disconnection. ceivability of their notes; and as for the They are now altogether for the local banks, few which were nominally excepted, the and o praise too high for them; three exception was an injury to them, and to years ago they were against them, and no my knowledge was complained of as such. abuse too low for them. When these banks Now, what was the conduct of the local resisted the panic, and did well, these pobanks under this forty years' exclusion liticians denounced them; now that they from the use and custody of the public mo have stopped payment, and injured the neys under the provisions of Vational country, and deprived the Government of Bank charters, and this forty years' exclu- its revenues, these same politicians exalt sion of their notes from Federal receipts them to the skies. This is inconsistencyand expenditures. under the enactments of inconsistency in the means, not in the object. National Bank by-laws. What was their The object is to re-establish the National conduct under these long and double ex- Bank; and the means are, to have another. clusions! Sir, it was the conduct of con- loss of Government revenues, and theretentinent, of satisfaction, of entire acquies upon, another argument to restore their idocence! They inade no complaint; they lized institution. This they declare! for asked for no change. On the contrary, they tell us, with the defiance of over-conthey endeavored to perpetuate it, and have fidepce, that they take these local banks always celebrated the period of their ex- as a half way house-as a house half-way clusion as the finest era of our currency, to the Bank of the United States where and the safest state of the Federal revenues. they will lodge and refresh a night, and This they did in 1832, when our tables then gallop into the Chesnut street place, groaned under memorials from local banks as a breakfast ride, the next morning. And to re-charter the Bank of the United States; so it will be. Trust them again! and the this they did again in 1833, when they State banks will fail again, as they did durprayed for the restora on of the deposites ing the war, as they dil in 1819, as they to the Bank of the United States, and ac- did in 1837, and as they are now doing in tually refused to receive them; and this 1838. They will fail again; the Federal they do now in praying for another Nation- government will lose its revenues again; al Bank, and then the cry will be redoubled for a National Bank.

have been receiving confirmation ever since. I was in the public service during the late war; witnessed the failure of the State banks, and saw the calamities of a government, and of a people, destitute of specie. The first Bank of the United States had ex ell, ed specie—it had done what Mr. Madison said it would do. in the masterly speech of 1791, which rever has been, and never can be, answered. In that speech he placed at the head of the list of the disadvantages of such a bank, these prophetic words:

A celebrated French satirist has made us acquainted with a most worthy country Mr. President, I have opinions upon this gentle man who had talked prose all his subject-opinions not of recent adoption, life without knowing it; so of these local or hasty formation. Their origin dates far banks. They have been ruined for forty back-a full quarter of a century; and they years without knowing it. During the whole period of the existence of the two National Banks they were in a state of total exclusion-absolute divorce-from all connection with the Federal Treasury, With this divorce, thus effected by corpo-ration by-laws, they were contented and happy. nay, wished it to be eternal! but the moment the same divorce is proposed to be effected by an act of Congress, he banks are in arms against it, and declare themselves ruined if it is done. This is a noble instance of consistency-of submission to a bank of the United States, and of resistence to the Government of the U. S. The sam of politicians of all that class of politicians who advocate a National Bank. They go for the divorce of the bylaws, and against the divorce by a law of Congress. They support a Bank of the

"First: Banishing the precious metals, by sub-tituting another medium to perform their office." At the expiration of its charter, in 1811, it had completely effected this work. It had banished the precious metils There was but ten millionsf specie left in the country! Two great errors were then commi.ted: first, in not replens

*

ishing the country with specie, and espe- the distress and suffering was actually cially with gold; secondly, in falling back then, what it is falsely said to be, and wickupon the paper of local banks for a national edly attempted to be made, at present. currency. In this condition, destitute of There is no comparison between the state specie, and relying upon the notes of local of things then and now. banks, we went into the war. The result was inevitable-the explosion of our whole monetary system-the bankruptcy of the Treasury-the ruinous use of depreciated paper-a resort to Treasury notes, on which the creditor often lost 33 per cent.-loans on oppressive terms-and the Government forced to make common cause with broken banks for the mutual support of each others credit. All this I saw. I saw the calamities, the humiliation, and the sufferings of the country; and I heard the lond and insolent triumphs of the Federal party-that part of it which opposed the war-exulting over an empty Treasury, an impaired public credit, a depreciated paper currency, and the national degradation for want of solid money. I saw all this; and my head, and my heart, both told me that the country ought never to be subjected to such a fate again.

At this epoch, this second explosion of the paper system, I came into the Senate of the United States. I came here in the autumn of 1820. I travelled from the Mississippi to the Potomac amidst the crash of falling banks, the wrecks of a paper currency, and the lamentations of a suffering nation. I arrived here to see a Government without a dollar, and borrowing money to pay its daily expenses, which, the year before, boasted a revenue of forty-seven millions, and tormented itself with schemes to get rid of surpluses! I commenced my Senatorial career under these circumstancs circumstances to make me meditate, and to make me feel. Happily, my associations were with the fathers of the Republicwith Macon and Randolph, whose intimacy I enjoyed, and whose friendship 1 possessed. My reading was that of the earis history of the Government-the Revolu This was my war experience; and now tion, the Confederation, the formation of for the experience of peace. After three the Constitution of '89, and the workings of years of war. peace caine, and with it came the machinery of the Federal Government the revival of business, and a multitude of under the administrations of the earlier local banks, and at their head, that immense Presidents-Washington, Adams, and Jefcharlatan of the monetary system-a Na- ferson. The result of this association, tional bank! Off went the whole togeth- and of this reading, was a thorough convicer; sp cie paynients resumed; confidence tion, 1. That the Federal Constitution was restored; the credit system in all its glory, formed by hard money men, and was inand every branch of business distended to tended to be a hard-mor.ey Government; the bursting point. To judge of every thing 2. that it had been converted into a paper by a single instance, it is sufficient to name money Government, contrary to the g nias the public lands, of which the amount of and intention of the Constitution; 3. That TWENTY-EIGHT millions of dollars was sold this departure from the Constitution was in a single year! and nearly all on credit, the cause of the moneyed calamities during payable in safe and solid specie paying the war, and again at that time; 4. That bank notes. In two years the whole of the remedy for these calamities was to rethese banks, the charlat in among the rest, turn to the plain meaning of the Constituwere swamped. Then we had a repetition tion, as expressed in the revenue act of of the scenes of seven years before. No 1789, and to confine the receipts and exspecie; no notes equivalent to specie; no penditures of the Federal Government to credit; no revenues; no price for property! gold and silver coin only. These were my Tender laws-property laws-replevin convictions; and as soon as circumstances laws-stay laws, the order of the day? An were auspicious for action, I commenced a entire stagnation of business followed, not series of measures, all tending to carry fictitious, but real; and such was the fall back the fiscal action of the Government in the price of all produce, all property, to the intention of the Constitution; fully and the wages of all labor, owing to the believing that if the Federal Government failure of the banks, and the absence of would require gold and silver for its own specie, that all debtors were placed in the jaws of ruin, and most of them entirely ruined. There was no Treasury order ther; no removal of deposites; no veto; no Jack son adminisiration to ruin the country; yet

Treasury, it would cause enough to be brought into the country, and to remain in the country, to supply the whole body o the people with hard money for all their common and ordinary dealings and transao

tions. It was not until General Jackson's hit the point of correction with such perfect administration, that I was able to take any accuracy, that the two coins, gold and silstrong and direct, measures towards the ac- ver, issuing from our Mint, have precisely complishment of the great object which the same value in the money market. Unpresented itself to my view. The saga- der the auspicious operation of that act, cious Mr. Macon often said to me that it our gold coin has risen, in little more than was in vain to attempt any reform, unless three years, from nothing to fifteen millions, the administration is with you. The elec. and will probably rise to twenty-five mil tion of General Jackson gave such an ad- lions before the termination of Mr. Van ministration. From that time there was Buren's present term. The act for repeala President, not only to favor, but to take the lead in the great business of restoring the constitutional currency, and my part became subordinate and easy. I had only to explain and defend the greater measures which his sagacity and patriotism conceived and recommended.

ing the act of 1819, and for restoring foreign coins to circulation, has sent Mexican dollars into every part of the Union, and has enabled other foreign coins, both gold and silver, to make some progress in penetrating our country. Silver has increased three-fold since 1832, and silver and gold It is not necessary to dwell on these mea- together, four-fold. Our specie was twensures, much less to enter now into any de- ty millions then; it is eighty now, with the fence of them. A brief enumeration will prospect of exceeding a hundred millions suffice. 1. No more National Banks. before the present term of Mr. Van Buren They had been found to be the great ex- is out. Our currency in existence is more porters of specie; and their chartered right abundant and more solid than it ever was to pay the Federal revenues in their own before; but the specie part of it is suppress notes, was in itself a clear breach of the ed by the power and policy of the Bank of Constitution, and banished gold and silver the United States, combined with the polifrom the Treasury, and, by diminishing the ticians and that part of the banks which demand for it, expelled it from the country. follow its lead. Acts of Congress had 2. To restore the gold currency, by cor- passed to operate upon small notes, recting the erroneous standard of gold. 3. and to exclude those under twenty dollars The repeal of the act of 1819, rendering from revenue payments altogether, and to uncurrent, with a few exceptions, the gold exclude all others which were not convertiand silver coins of all foreign countries. 4. ble into gold and silver" upon the spot," The multiplication of the mints, both for the at the will of the holder, and without loss purpose of coining money in different parts or delay to him. Public opinion had been of the Union, and for becoming places of awakened on the subject of small notes; and deposite and safe-keeping of the public the Republicans every where were moving moneys. 5. The suppression of all local towards the suppression of all under twen bank notes under twenty dollars. Having ty dollars. Such was the progress, and no direct power over the banks of the State, such the success, of our measures in May the only mode of accomplishing this ob- last, when eight hundred banks stopped ject was by the revenue regulations of the payment at once, shut down close upon all Federal Government, and by operating on the specie in their vaults, denying a ninepublic opinion in the different States. My own limit was one hundred dollars, but I did not attempt to establish it because I knew that I could not succeed. My conviction is now clear that there ought to be no bank note under one hundred dollars.

pen e, a picayune, a five cent piece, even, to the Government whose thirty millions of deposites they held, or to the community who held a hundred and twenty millions of their notes! In the midst of profound peace, general prosperity, under a GovernSuch were our measures for restoring the ment without taxes and without a public currency of the Constitution to the coffers debt, with four times as much specie of the Federal Treasury, and supplying as was in it five years before, came the country with gold and silver for all the this crash of the banks. It came like common and ordinary transactions and deal- a clap of thunder in a cloudless sky. In ings. The success, notwithstanding a pow- one moment, as it were, a Government, erfal combined political and moneyed oppo- with thirty millions of revenue on hand, sition, was astonishingly great. The re- was left without a shilling; in one moment, charter of a National Bank sunk under the a nation of fifteen millions of souls was deveto, sustained by public opinion. The prived of ninepences for the market or the act for the correction of the gold standard post office. As if to proclaim their design to

banish all specie from the land, a simulta- ministration itself I find them now where neous and universal deluge of small notes I was many years ago. I believe them to and shin-plasters was poured upon the peo- be right, and shall stand by them, and ple; and the significart cry was set up, abide their fate. If they sink in this conthat specie payments could never be resto- test with the banks and the Federalists, I red until a National bank was established. shall go down with them. This cry explained the main cause of the general stoppage, and the sole cause of the shin-plaster and small note issue.

I stand upon the two principles of the bill-1. The United States to use the money of the Constitution in the receipts and All this took place in May, 1837. It was disbursements of the Federal Treasury: 2. a repetition, without the excuse of war, of The United States to receive their own the bank explosions of the war in 1814; it money, to keep their own money, and pay was the second explosion of the banks out their own money. Istand npon these two since the war, and in profound peace. It principles; I cannot surrender them, though was expected to astound, terrify, subdue, I could consent to take them one at a time. distress, and coerce the country into a sub- The details of the bill are open to compromission to the re-establishment of the Na- mise. There I am ready to give and to tional Bank! a result that would have been take-to surrender an! concede to do eveinevitable had it not been for the eighty ry thing, consistent with the preservation millions of gold and silver which Jackson's of the principles, to conciliate the support, administration brought into the country, or to purchase the forbearance of friends. and which has so well kept up the value of In some particulars, I would prefer a change "bank notes that those which are in good of details; I would prefer additional credit are now no more than one or two branch mints in place of the Receivers Geper cent. below par. This third explosion neral-mints that would answer the double in twenty-five years-this second explo- purpose of keeping the money of the Gosion in time of peace this loss of national vernment, and coining money for the peorevenues, as if by enchantment-this dis- ple. appearance of specie, as if touched by a The principles of the bill I hold to be magic wand-roused and electrified the founded in the clearest reasons of procontinent. The public mind came at a priety, and constitutionality, and sustained bound to the conviction that the Federal by the fullest voice of trial and experience. Government ought to be disconnected from Every Government should be, at all times, the banks, and from their paper currency. the master of its own property, money and The conviction was general, almost unani- every thing else. A Government should mous, among the Republicans; a few only not be put to the delays and contingencies among them were for trying the local banks of asking for its own, much less of suing and their paper once more, as if three fai- for it, and above all, of having to sue where Tures in twenty-five years were not suffi- State laws may interpose to delay, or to cient; as if another failure was not inevita- defeat the recovery. The revenue of a Goble, and as if another failure must not end vetnment is its daily support, it is like the in the restoration of a National Bank, with daily support of a family,-it cannot be the restoration of the political party, with stopped or withheld, without affecting the all their principles and measures, who go existence of the Government itself. Evewith that bank. The Federal party, of ry Government upon earth, our own excepteourse, with some honorable exceptions, ed, puts its money where it can go and take opposed the disconnection. They oppose it. All other Governments put their mo whatever the Republicans propose, no mat- ney where they can command it, where ter what. They were opposed to the junc- they can seize it, if necessary, and punish tion of the Government with the State a delinquent holder. We do the same with Banks three years ago, when those banks all our property, except money. were doing well; they are for compelling ships and forts, our military and naval the Government to stick to them now that stores, our public lands, and public edifices, they have done ill. This is the state of par- are all in our own custody. We do not ties; the Republicans almost universally have to beg, or bring suits at law, to recofor the divorce of bank and State; the Fed- ver their possession. We keep them, suberalists, almost universally, for the conjunc- ject to our own order, because the existence, tion of Bank and State. In this division and the operations, of Government, which and subdivision, I find myself with the holds civil society together, and prevents mass of my own party, and with the ad- mankind from relapsing into anarchy and

C

Our

violence, will not admit of interruptions so; its duty to the country equally requires and delays. If this is true of property, it. By using that money, two great adhow much more true is it of money-that vantages would always result: 1. The daily pabulum, without which Government Government would always have in its cofcannot exist a day? This fundamental fers real money; 2. The country would alaxiom, true of every Government, is pre- ways possess an abundant supply of the eminetly so of ours. Our Government is precious metals. Certainly the Federal Gocomplex-State and Federal-and each vernment owes great duties to itself and to should have their own Independent Trea- the country, in relation to the currency. It sury. The present Constitution grew out should not abdicate those duties, nor deleof the Independent Treasury question. gate them. It should not expel specie from Other causes helped on to the formation of the country by abandoning the use of it. the Constitution; but a revenue of its own The experience of forty years, shows that -a revenue independent of the States, and a cessation of demand for specie, on the of course independent of corporations-was part of the Federal Government, banishes the exciting and controlling cause which gold and silver from the country. This led to its adoption. The whole history of was the result both under the first and sethe confederation, from the close of the cond banks of the United States. On the Revolution to the year 1789, proves this. other hand, the experience of five years Yet where is the Independent Treasury, shows that a demand for specie by the Fewhere is the Federal Treasury, if corpora- deral Government attracts it to the country; tions are to hold our money, may refuse to that we have increased our supply from pay it when they please, and shall be back- twenty to eighty millions in five years, uned by their State Legislatures when they re- der that demand; and that a continuation fuse to pay? To commit our money to of the demand will continue the increase the custody of such corporations, is to forego until the country is adequately and fully the end for which the Federal Government supplied. This is the way to regulate the was formed; to comniit it to such corpora- currency. A hundred and twenty or thirty tions again, after the experience we have had, and during the experience which we now have, is to repeat a folly for which we have been three times punished, and to exhibit a fatuity which announces a doom to destruction. Upon the clearest principles An adequate supply of specie for the of reason, of constitutional obligation, and country, is one of the highest duties of the of experience, the Federal Government is Federal Government. By the Constitution, bound to take into its own hands the keep it is made the conservator of specie; by ing of its own money. This is one princi- abdicating its duties, it had banished from ple of the bill; the other is the use of hard the land that which it was bound to premoney in the receipts and disbursements of serve. The States delivered to this Governthe Federal Government. This principle ment, in 1789, an adequate currency of gold is the ally of the other. They go together, and silver. The first revenue faw ever and can hardly live separately. To receive passed by Congress, enacted that the revethe promissory notes of the banks, is to re- nue should be paid " in gold and silver coin ceive nothing but their promises to pay mo- only." There was then no complaint of ney. If they break that promise, the only scarcity. General Hamilton's order for resource is to take what they choose to evading that law, did not turn upon the give; that is to say, more broken promises ground of scarcity of the precious metals, to pay money or to sue them; and, if suit but on the plea of convenience in handling is brought, State laws may interpose to bank paper, and upon the policy of increasprotect the bank, and to compel the Government to take its pay in more broken promises to pay. Far better to take the promissory notes of the citizens. They would not refuse payment, as the banks have done; and if they did the State Legislatures would not interpose to shield them.

millions in gold and silver will regulate the banks and the exchanges; and that amount can be attained, and ought to be attained, in six or seven years, by a continuation of General Jackson's policy.

ing the quantity of bank circulation. There was no complaint of the inadequacy of specie until the first Bank of the United States had banished it from the country, as Mr. Madison and others predicted that it would do.

Large mercantile payments always have The Federal Government ought to use been, and forever will be, made in bits of the money of the Federal Constitution. Its paper, representing masses of property. He duty to the Constitution requires it to do is a ninny, or believes others to be ninnies,