should convene, which might adopt such further legislation in regard to the sales of the lands as the public interests may require?

Sir, (said Mr. N.,) there is another reason why I cannot vote for the resolution before the Senate. A new rule has been adopted in regard to the sale of the public lands, that has been in operation for a time, and which has a tendency to check speculation. I would not repeal that rule, and open again the floodgates of speculation; certainly not until I know whether Congress will pass any act regulating the sale of the public lands. It is, I think, the duty of Congress to do this; the interest of the country requires it; public sentiment demands it; and it is strongly recommended by sident. If Congress suffer the session to pass off, without attempt. ing to regulate the sale of the public lands so as to check speculation, they will neglect their duty to the country. Believing that there will be additional legislation on the subject, which may supersede the Treasury order, he was not at this time prepared to disturb it. Changes in any extensive business are always attended with some voided as much as possiinconvenience, and should be ble. When it shall be settled that Congres ammans will no alter the system, it may become necessary to decide whether the rule prescribed in the order shall be maintained, or the old practice restored; and if we do any thing on this subject, our action should be more comprehensive; it should embrace the whole subject, and be settled by law what currency shall be received for the payment of the revenues, not only from the lands, but from customs and all other dues. The doubt and uncertainty which hangs over this subject ought to be re

the Treasury to collect the taxes and debts due the United States in a currency different from the legal currency of the country. That resolution provides "that the Secretary of the Treasury be required and directed to adopt such measures as he may deem necessary, to cause, as soon as may be, all duties, taxes, debts, or sums of money, accruing or becoming payable to the United States, to be collected and paid in the legal currency of the United States, or Treasury notes, or notes of the Bank of the United States, as by law provided and declared, or in note of banks which are payable and paid on demand in the said legal currency of the United States; and from and after the twentieth day of February no such duties, taxes, debts, or sums of money, accruing or becoming payable to the United States, as aforesaid, ought to be collected or received otherwise than in the legal currency of the United States, or Treasury notes, or notes of the Bank of the United States, or in notes of banks which are payable and paid on demand in the said legal currency of the United

States."

[DEC. 22, 1836.

debtors of the Government, it was designed to restrict them, and did restrict them. What was the condition of your Treasury at that period, and how was the revenue collected? There was then in the Treasury more than one million of dollars in the bills of broken banks; and the public revenue had been collected in the notes of banks which did not redeem them in specie; a large portion of the banks in the Union, which had suspended specie payments during the war, had not resumed them. This resolution expressly limited the Secretary so far as not to permit him to receive any bills of banks which did not redeem them with specie. He is expressly prohibited from receiving the notes of non-specie-paying banks; and it was left optional with him to collect the public revenue either in the lawful currency of the United States, or in Treasury notes, or in the notes of spe cie-paying banks. So far, a discretion was still left with the Secretary; but the discretion he had exercised of taking bills of banks which did not pay their notes in specie, was taken from him. These bills were received by the Bank of the United States only as special depos

The Senator from Massachusetts, in a labored legalifes, and the loss was thrown upon the Treasury. argument, has attempted to prove that this resolution creates a peculiar currency in regard to all branches of the public revenue, and all debts due the United States. He not only maintains that the resolution imposes an obli gation on the Secretary to receive the notes of all banks that redeem their bills in specie at their counters, but also that it enlarges the rights of payers, that it confers on the debtors of the United States the legal right to pay their debts in paper currency; that is, in the notes of specie-paying banks. He went so far as to assert, and stake his reputation as a lawyer on the question, that a receiver, who should refuse to receive the notes of specie-paying banks, and which were known to him to be such, would render himself liable to an action by the party injured. He admits that the fact that the notes are issued by banks which pay their bills in specie, must be made known to the receiver; so that, upon this construction of the resolution, the receivability of paper is to depend on a fact, and that fact is to be decided by a subordinate officer of the Government. The argument of the gentleman, however able, was too elaborate, toorefined, to receive his assent. He had never believed that profound legal science was very necessary in construing a plain statute law; nor did he believe that men of eminent professional skill were always the safest expounders of written laws, whether statutes or constitutional provisions. Cicero said, in his day, that the lawyers had spoiled many excellent institutions by their refinements; and we all know that, in our own times, by their forced and strained constructions, they have mystified and perverted many plain and good laws, and bewildered the clearest minds. Whether we look to the language or the manifest object and purpose of the resolution of 1816, he thought there could be no difficulty in understanding it. We are told by legal writers, that, in giving a construction to statutes, it is necessary to ascertain the general object of the law, the evils and mischiefs that existed, and which the act was designed to remove; and more especially is this said to be necessary when the language of an act is doubtful or ambiguous.

This resolution was only an instruction to the Secretary of the Treasury; it has neither the form nor the language of a public act. The title shows clearly that the object of Congress was solely to secure the Treasury, and guard it against a loss from bad money. It is entitled "A resolution relative to the more effectual collection of the public revenue." Can a mere instruction to the Secretary of the Treasury, as the fiscal agent of the Government, change the rights or obligations of the debtors of the United States! Suppose a creditor should instruct his agent to receive payment for a debt in some other than the legal currency, or to take less than the sum due, or to receive payment in some kind of property, would this confer on the debtor the legal right to pay his debt, and discharge his liability, in either of the ways specified? On a suit by the creditor, could he avail himself of such instructions to vary the nature of his liability?

What was the object of the resolution of 1816, and what were the evils it was intended to remedy? It is said that its object was to enlarge the rights of the debtors of the United States, and to enable them to pay their debts in a more convenient and easy manner. But does this appear on the face of the resolution? Is it inferrible from its title? And if we look to the state of the Treasury and the condition of the revenue at the time the res olution was adopted, we cannot fail to discover the evils which this resolution was intended to remedy. Instead of its object being to enlarge the rights of the

The construction here contended for had always been given to the resolution of 1816; and the Senator from Massachusetts had, on former occasions, regarded it in the same light, as had been shown by the extracts read from his speech and report by the Senator from Missouri, [Mr. BENTON] It was a very extraordinary position attempted to be maintained, that for twenty years there had been a public law in force in the United States, conferring on paper money, or bank bills, the legal character of gold and silver, so far as regards the payment of the revenue and all debts due the United States, and that the country has been unapprized of the existence of such law. An act to legalize paper money, and make it a lawful tender for all debts to the United States, is one of great importance, and would have been likely to have excited general interest and attention.

The sixteenth section of the act chartering the Bank of the United States provides that the deposites of the moneys of the United States shall be made in that bank and its branches. But the bank had refused to receive the bills of certain banks, notwithstanding they were redeemed in specie, and had been justified by Congress in so doing, in a report to that effect, drawn up by the Senator himself. But if the resolution of 1816 gave to the bills of State banks all the character of gold and silver, so far as regards dues to the Government, then such bills were the "money of the United States," and the bank was bound by its charter to receive them on deposite.

The Senator from Massachusetts referred to the fact, that the President last session sent a message to Congress, recommending the repeal of the fourteenth section of the charter of the Bank of the United States,

DEC. 22, 1836.]

Treasury Circular.

110

[SENATE.

which required that the notes of that bank should be such, too, he believed, as were contemplated by the Exreceived in all payments to the United States. could not perceive what inference could be drawn from He ecutive at the time the order was adopted. But as those this fact, favorable to the gentleman's purpose; but it who supported the resolution before the Senate took appeared to him that the necessary inference was directthe affirmative of the issue, he might, perhaps, with ly the contrary. The bills of the Bank of the United more propriety, call on them to point out the evil conseStates were made receivable by the Government, by a quences of the order. distinct provision in its charter; and the President wish-boldly asserted, that the Treasury order had deranged but he thought with no very great success. This they have attempted to do, ed that section repealed, which would place them on It has been the same footing as other bank bills. But if the Senthe currency, and occasioned the existing difficulties and ator is correct in his argument, it would have been of pressure in regard to money, which he admitted to be no use to repeal the fourteenth section of the bank char-plaint against the present administration. It is the old very severe. This, sir, (said Mr. N.,) is no new comter, as the United States would still have been obliged story, which has been so often repeated within the last to receive the bills of that bank, under the resolution of few years, that its authors on the present occasion can 1816. Moreover, the fourteenth section was never of lay no claims to originality. On his way to this city, any importance to the Bank of the United States, if, as during a short detention in New York, he had a conis contended, the resolution of 1816 gave to the bills of versation with a merchant, who complained not only of all specie-paying banks the character of receivability for debts payable to the United States. The bills of the the times, but of the Government. It was, however, only State banks, so far as regarded the Government, stood a repetition of the old story, of tampering with the curon the same footing as those of the Bank of the United rency!-war upon the currency! When will the GovStates; although it has always been claimed that the complaints come with an ill grace from bankers, brokers, ernment cease tampering with the currency? These privilege conferred by the fourteenth section formed a part of the consideration for which the corporation had and merchants, who are strenuous supporters of that inpaid a bonus of a million and a half of dollars. flated system of paper money and credit, whose inherent defects are the source of the very evils which they dethese, he was forcibly reminded of an anecdote of Doctor Mr. N. said that when he heard complaints like Franklin, who, when in Europe, was a member of a occasions each member was to suggest some problem in learned society, which had a regulation, that on certain physical science, and each one present was to give an explanation impromptu. The Doctor, who was fond of starting game for philosophers, as he called it, proposed this question: "How it was to be accounted for, that a barrel of fish would contain more salt than the barrel without the fish?" The explanations given by learned savans, although extremely ingenious, did not appear to

nounce.

Mr. President, if there is any doubt in regard to the legal import and effect of the resolution of 1816, still there can be no question as to the kind of currency which is receivable for the sales of the public lands. The fourth section of the act of 1820, which superseded the credit system, and required that sales should be made for cash payments, settles that question. The proviso to the fourth section is, "that no such lands shall be sold at any public sale hereby authorized, for a less price than one dollar and twenty-five cents, nor on any other terms than cash payments." This section, it is true, is confined to lands forfeited to the United States; but its spirit and language are in perfect accord-be entirely satisfactory. At last all eyes were turned ance with the other sections of the act. The clause "cash payments," must be understood in its ordinary acceptation, in which sense it does not mean Treasury notes, nor the notes of banks, but money, which is a legal tender by the laws of the United States. In the ordinary acceptation, "casli" signifies money, or that currency which is a lawful tender for debts. Any other construction would be to trifle with language, and an insult to common sense.

Mr. N. said that, without consuming more time on that point, he was satisfied that the objection to the Treasury order, on the ground of its illegality, was entirely unfounded.

Mr. N. said he would now proceed to submit a few remarks on the other division of the subject. Has the Treasury order operated unjustly and injuriously to the interest of the country? Has it caused the embarrassments and pressure for money which have prevailed so extensively and disastrously throughout the country, and particularly in the large commercial cities? All these evils have been charged upon it, as the results of the derangement it has occasioned in the business and monetary concerns of the country. In regard to the discrimination or exception from its operation in behalf of actual settlers, and the citizens of the States in which the lands were sold, as that exception had now ceased, he would not spend any time upon it.

The Senator from Kentucky [Mr. CRITTENDEN] asked, with an air of triumph, what had been the good effects of the order? Whilst its evils have been so manifest, and of such great magnitude, we have a right, said he, to call on its advocates to point out its benefits. Mr. N. said that, in his preliminary remarks, he referred to what appeared to have been some of the beneficial effects of the order, and he would not repeat them. They were

not so.

so.

towards the Doctor, who, it was supposed, could give a satisfactory solution of a problem he had suggested. "Gentlemen," said he, "in the first place, the fact is and politicians, so often repeated, of tampering with the So in regard to the complaints of merchants currency, it is a sufficient answer to say, the fact is not These charges are without foundation, even if we consider currency in the very comprehensive sense in which it appears to be regarded by the Senator from derstood him, appears to consider currency as compreMassachusetts, [Mr. WEBSTER] who, if he correctly unhending not only bank bills, but bills of exchange, and every description of paper which was used to facilitate the transactions of commerce. This appeared to him to be altogether too comprehensive a view of the subject of confounding currency and credit, which he had supposed currency, even in a commercial sense. It appeared to be Senator has on his table, (containing the constitution of were essentially distinct. In the small book which every the United States,) is a much better definition: he there found, that Congress shall have power to coin money, regulate the value thereof, and of foreign coin." we find what is the legal and constitutional currency of the United States. Gold and silver, either the coinage of the United States or foreign coin, the value of which has been fixed and regulated by a law of Congress, constitute the only currency known to the constitution.

Here

tion, whatever circulates as money, and is received as But, in a commercial sense, or in the common acceptasuch, in the ordinary transactions of society, may be considered as a part of the currency of the country; and in this view of the subject, bank bills form a part of our currency. But if we admit the bills of our banks to be a component part of the currency of the country, still the complaints, of which we have heard so much for

SENATE.]

Treasury Circular.

some years past, are without any just foundation. What are the acts of this administration, which have been denounced as tampering with the currency, and making war on the currency? The first of them is the veto of the President of the bill for rechartering the Bank of the United States. This may have been a bold measure, but great evils require powerful remedies; and it was confirmed and fully sustained by the people, and afterwards by Congress, which refused to give the bank another charter. If this measure had succeeded in destroying the Bank of the United States, it might be considered, in some measure, as interfering with the currency of the country, if it can be made out that the bills of that bank possessed any essential qualities as money, or currency, which do not appertain to the bills of the State banks. But he did not consider that the bills of that bank possessed any material advantages, as money, over those of the State banks; for such were its regulations, that the different branches, so far as respects the redemption of their bills, were so many independent banks. It was not necessary, however, to consider this question, because the bank had not ceased to exist. No, unfortunately for the country, the "monster" still lives; and, according to the declarations of its president, at the very time of its resuscitation, under a charter obtained from one of the States, it inherits a circulation of twenty-two millions, and a credit throughout the world. We have the word of its president that the bank still possesses its essential ability to do good, and, in the opinion of many, it has lost none of its powers of mischief. Whether for good or for evil, then, the bank still exists, and the country has the benefit, if such it is, of that paper currency which it can supply.

Now

The next act which has been condemned as an act of war upon the currency, is the Treasury order for removing the public deposites in 1833. This, as is well known, occasioned great excitement; the measure was denounced, in this hall and elsewhere, as illegal, unconsti utional, and an alarming usurpation, calculated to derange the currency, destroy public and private credit, and prostrate the entire business of the country. the excitement has gone by, and the angry waves subsided, and the measure already become, in some sense, a matter of history, we can look back upon it dispassionately and calmly. And what was this alarming act of usurpation, this war upon the currency and credit of the country, which was to paralyze all the great interests of the nation? He did not speak with any reference to its legality or constitutionality, but solely with regard to its effect on the currency and credit. Why, sir, (said Mr. N.,) this measure consisted simply of an order from the Secretary of the Treasury changing the place of deposite of the public revenue, at a time when the money in the Treasury amounted to but about nine millions of dollars. The measure related only to the money of the United States; it had no application whatever to the currency of the country, whether metallic or paper; it had no operation upon commerce, or duties, or importations. This act, which was said to derange the currency and destroy credit, was nothing more than the control and management of the funds belonging to the people of the United States, in no way interfering with the transactions of commerce, or currency, or credit. Cannot the Government take care of their own funds, and manage them as they think best, without being charged with making war on the currency? without an outcry from bankers, brokers, and merchants, that their business is injured, and the whole country exposed to ruin? Must the Secretary of the Treasury consult the bankers before he can decide on any measure in relation to the public funds? If an act, having no bearing on commerce, in no way directly affecting any of the interests of the country, and which merely changed the

|

[DEC. 22, 1836.

places of deposite of the public revenues, could have occasioned the serious consequences which were charged upon it—the derangement of the currency, prostration of credit, the wide-spread embarrassments and distress which prevailed-the case would afford the strongest, the most irresistible, argument against the whole paper credit system. If these consequences did follow from so small a cause, it proves the miserable, wretched condition of your paper currency, which the Senator from Massachusetts seems to consider as preferable to gold and silver.

Untsable and bad as he considered the paper currency of the country, he would make no such charge against it; he did not believe it could be deranged, and the whole country involved in difficulty and distress, by so trifling a cause. No, sir, there was at that period a war upon the currency; but it did not come from the Executive, or this Government, but from the Bank of the United States, and other banks which from fear or favor co-operated with it in its measures intended to distress the country, and create a panic. That war on the currency and on the country came from the great mammoth of the paper system, which possessed more power over the currency than this Government; which could make paper money plenty or scarce at its pleasure. At this day, he believed no one could be found who would maintain that the embarrassments and distress which prevailed during almost the entire year of 1834, were occasioned by the change which was made in the management of the public revenue.

Mr. N. said he now came to consider the last measure which had been condemned as a tampering with the currency-the Treasury order of the 11th July, requiring cash payments for the public lands. It is claimed that the money pressure which has prevailed for months past, and which still continues, has been occasioned by this new regulation as to the sales of the public lands. The Senator from Massachusetts [Mr. WEBSTER] did not seem to advance this opinion with confidence; he said there was a complication of causes; that this order, with other causes, had occasioned the existing difficulties; but when he came to point out the other causes, they did not appear to be very numerous or complicated, and all of them centered in the executive department of the Government. The complication of causes appeared to consist of but two; the Treasury order, and the execution of the deposite act, or the apprehension of the manner in which that act was to be executed. That the deposite act had contributed to increase the money pressure, Mr. N. did not doubt; but what properly belonged to the act, ought not to be charged to the execution, or the apprehended execution. He reluctantly gave his support to that act, although sensible at the time that it would increase, rather than relieve, the pressure for money, which prevailed. But it had not been shown that any censure was justly chargeable upon the Secretary for the execution of the law. It was impossible but that the act should occasion some temporary inconvenience in the monetary concerns of the country. It disposes of a large sum of money, nearly forty millions, upon principles altogether foreign to the commercial principles which control and regulate the moneyed capi tal of the country. Population is not the principle upon which commerce distributes money.

Mr. N. said that, in relation to the Treasury order, he would not deny that in some small degree it may have increased the difficulties which exist. It had increased the demand for specie, and that was the principal object of the measure, to obtain something of real value for the public lands. Its operation has been to replenish the deposite banks in the West with specie funds, and to draw them from the banks at the East, which bas to some extent, diminished the ability of the latter to