SEPTEMBER, 1837.]

Fourth Instalment Bill.

[H. OF R.

now, and our expenditures must be reduced to seventeen or eighteen millions.

The gentleman from Tennessee appeared to complain that the Executive had not, when the crisis came upon the country, in May last, directed the different departments to stop the expenditures. This was singular doctrine, after all we had heard for some years past on the subject of Executive usurpation, to expect the Executive to direct the execution of the laws to be suspended, while there were means in the and of the departments were, from necessity, similar to those stated by the gentleman. It was evident that the revenue would fail, and that some of the expenditures could not be met -a minute inquiry was instituted in every branch of public expenditure, to ascertain what could be conveniently postponed till next year. It was ascertained that some fifteen or sixteen millions might be suspended till the next year, to wait the future action of Congress.

A few days since, when he (Mr. THOMAS) was absent, a gentleman from Virginia propounded an inquiry to the committee somewhat similar to the one now propounded; and in consequence of this a member thereof reassembled the committee, for the purpose of considering whether they should report now, or wait until the regular session of Congress. This meeting was held without coming to any conclusion, and an adjourned meeting of the committee was to be held to-morrow morning. The gentleman would therefore perceive that he could not pre-Treasury. But, sir, the views of the President tend to say what would be the course of the committee on this subject. The House had referred to them the Message of the President and the report of the Secretary of the Treasury on this subject, and he was not prepared to say what would be the decision of the committee; whether they would be disposed to pass a general bankrupt law to affect that class of citizens alluded to by the gentleman from Pennsylvania, (Mr. BIDDLE,) or not. On to-morrow morning, however, the subject would be taken up, and he presumed he would be instructed by the committee to make a report to the House in some shape or other.

Fourth Instalment Postponement Bill.

On motion of Mr. CAMBRELENG, the House then went into Committee of the Whole on the state of the Union, Mr. HAYNES in the chair, and resumed the consideration of the bill to postpone the fourth instalment of deposit with the States.

It would, however, be wholly impracticable to curtail the expenditures in the last quarter of the present year. The very branches of expenditure referred to by the gentleman from Tennessee are not now within our reach. Onehalf of the amount is already expended, and most of the remainder is under contract. Whatever we may do in curtailing the expenditures for the next year, any attempt to interfere with the expenditures of the last quarter would be wholly unavailable; and, if attempted, must be attended with much loss and embarrassment to the Government.

exhibit a deficiency in our means to meet the current expenses of Government. This deposit cannot be made unless we create a public debt for the sole purpose of placing a surplus in the Treasury, to be transferred and deposited in the Treasuries of the several States. Such a measure, he felt persuaded, would never be sanctioned by Congress.

Mr. CAMBRELENG said he would detain the committee only to make a short reply to the Gentlemen might take what view they gentleman from Tennessee, (Mr. BELL.) The pleased of the state of our finances, but it is gentleman had referred to the project of estab-impossible to make any estimate which will not lishing a Treasury bank of deposit and issue. On that question he would not now detain the committee further than to say that the Treasury bank was already established, not only of deposit, but of circulation. We have always had one to some.extent, and have generally had two millions of warrants in circulation. He had also referred to the expenditures of Government—they had increased two or three-fold; but that increase had been made almost exclusively for extraordinary purposes. We appropriated, in 1836, thirty-eight millions; of which, as may be seen by a report of the Committee of Ways and Means, seventeen millions and a half were appropriated to ordinary purposes, and twenty millions and a half to extraordinary objects. Of the latter, thirteen millions and a half were required for Indian treaties and Indian wars in the neighborhood of the gentleman from Tennessee. The appropriations for the present year amount to thirty-two millions, of which fourteen were for extraordinary purposes. He concurred with the gentleman as to the necessity of reducing the public expenditures. It is obvious they will, as they have done uniformly, increase with an increasing revenue, and be suddenly curtailed when the revenue falls short. Such would be the case

Mr. BELL made a few remarks in rejoinder to Mr. CAMBRELENG, and insisted that the statement of the gentleman did not controvert Mr. B.'s of yesterday, that there was a dead fund of five millions of dollars on hand; and that, assuming that fact, which he said was incontrovertible, according to the gentleman's own estimate, there would be a deficit of only one million some odd hundred thousand, but, according to Mr. B.'s estimate, an excess of rising three millions.

Mr. UNDERWOOD next addressed the committee. Mr. Chairman, (said he,) I have listened to the debate with surprise. It seems that the Secretary of the Treasury is unable to make a plain statement, unfolding the present condition of the national finances, or that we are incapable of understanding it. In either case, there is cause for regret. It is a national calamity that a man should be placed at the head

of the Treasury, whose confused and involved statements leave doubts in regard to the correctness of his reports. On the other hand, if the fault is ours, if the Secretary has been clear, discriminating, and definite, and we cannot comprehend the facts, it is a serious misfortune that the people are so poorly represented.

[SEPTEMBER, 1837.

In contemplating the evils of a depreciated currency, I was anxious for the adoption of some effectual and immediate remedy, and desirous that the President would propose some scheme of relief in which I could concur. But he has proposed nothing for the relief of the people. On the contrary, he has told us that "all communities are apt to look to Government for too much," and referred to the “uncommon fruitfulness" of the country, and the "proceeds of our great staples," to liquidate debts at home and abroad, and to revive commerce and credit. This waiting upon the seasons and the crops is rather cold comfort to those who must perish before these remedies can operate, unless they can procure other aids. It is like telling the poor wretch who is shivering at the door, "you will get over it when warm weather comes," instead of helping him with a blanket. However much the Message has failed to propose or recommend any thing in aid of the people, it has substituted a scheme in aid of the office-holders, and still further to enlarge Executive power, the deleterious consequences of which I shall briefly expose.

Mr. Chairman, when the States acceded to the terms prescribed in the deposit act of 1836, a clear contract was formed between them and the General Government-just such a contract as would entitle an individual to damages in similar circumstances, if the contract was not performed. Suppose you had a surplus quantity of work-horses, and you were to propose to me to keep them for you, that I might have the use of them as long as I retained them; | that I should insure their lives, and return them in good order when called for; and that you would deliver to me a certain number at four several times, a week or a month apart; provided, however, that you should not reclaim more than one horse in any one month, without thirty days' previous notice. Suppose I assent to all this, and go on and erect stables, purchase provender, and employ hands to take The plan is to establish sub-treasuries, and to care of the horses, and to work them so as to make this a "hard money Government." The remunerate me for all my trouble and expense. jingling sounds of "hard money," when we are Suppose you deliver me the first three portions overwhelmed with shin-plasters, may, and probat the times stipulated; but a few days before ably will, tickle the ears of many people, and the last are to be delivered, you say to me that some, as in former days, will be deluded into I shall not have them-that you find you have the belief that the "hard money age is just use for them yourself. May I not answer, "I before them, and that nothing more is neceswant them likewise; I have made my arrange- sary to bring on this political millennium than ments, looking to the fulfilment of your prom- to worship at the shrine of President Van ises. I have agreed that my neighbor's chil- Buren with increased devotion. There is no dren shall go to school over the mud upon the more hope of a political zealot than there is of backs of a part of the horses, and I need the a religious bigot. Each is without the pale of rest to help me about improvements in progress reason. I do not expect to influence partisans; on my farm. I have been at expense and but those who are not blind past all cure, may trouble in preparing to take care of them. I be preserved from falling into this new pit. have assumed risk by insuring their lives; and now, sir, if you don't comply on your part, I will sue you for damages." There never was a plainer case of contract between individuals than the one supposed; and yet, sir, it is precisely the case between this Government and the States. So far as legal and moral principles are concerned, there is no distinction between the cases. There is but one difference; individuals could appeal to the judiciary for redress; this Government is amenable to no such tribunal. But, sir, the perpetrator of wrong, who violates principle because he knows that he can do it with impunity, more deserves the scorn of mankind than if the dungeon or the gibbet were the penalty. I beg the members of this House not to flatter themselves that they are irresponsible for voting to violate the faith and contract of the nation. There is a political tribunal before which they must account. They may hear the verdict of an incensed people proclaimed in a voice of thunder, "Depart from our service, ye workers of iniquity." You had better not be the first to violate the contract, lest the States imitate your example, to punish you.

The plan of the President and the Secretary of the Treasury is to establish sub-treasuries at such places as may be deemed proper, and to appoint suitable officers, at which, and by whom, the public money shall be kept and disbursed; and to receive nothing in payment of public dues but specie. This plan is to bring about the hard money age!

One of my principal objections to the subTreasury is, the increase of Executive power and patronage which would necessarily result from it. The Secretary of the Treasury says, "The whole addition of principal officers need not exceed ten." He estimates the increased annual expense at fifty or sixty thousand dollars only. Ten principal officers! What salaries would you give to each? Not less, I suppose, than you give an Auditor-$3,000 a year; especially as they would be located in the large cities. What a scrambling among office-seekers this new batch of offices would produce! How many interviews and intrigues at the White House would grow out of it, I leave to those who are fond of such speculations. Thirty thousand dollars a year I set down as the least

SEPTEMBER, 1837.]

Fourth Instalment Bill.

[H. OF R.

for ten "principal officers," under this scheme! | attempt to show, grew out of a policy the most How many minor officers-clerks and agents- dangerous and disastrous in its character, and will be required, we are not informed; nor are which, if it had been persisted in, would have, we told what necessity there will be for addi- in all probability, severed this Union-he meant tional buildings; nor are we told where they the unequal and inequitable policy misnamed are to be located. I will venture to predict "the American system," which had for its obthat, instead of $60,000 a year, this sub-Treas- ject the official elevation of its projectors and ury scheme will cost the nation double or treble zealous supporters, and which, in its operation, as much, should it ever go into operation; and was at the same time beneficial to one portion just in proportion as the people lose money, to of the Union and destructive to another. The sustain the establishment, so will the President surplus was now disposed of, and the object gain power to reward his partisans. for which the deposit law was made is accomplished, and it was of no further use. He hoped it would take its place among the things that had been and are not, and that the policy which gave rise to its necessity would share the same fate.

The question involved in the bill was simply whether the Government shall deposit $9,000000 with the States, in proportion to their representation in Congress, when, to enable her to do it, she must borrow a sum equal in amount, to supply her own wants during the current year.

But, sir, I look upon this new scheme as an entering wedge merely; the beginning of a new system, which will ultimately place all the money of the nation under Executive control. The Secretary already hints that he could furnish an excellent general paper currency, in small bills, based upon an equal amount of specie deposited in his sub-treasuries. I admit it could be done, and that it might be convenient to the people. But the transition is so easy from a sub-Treasury bank of deposit to a subTreasury bank of discount, that I apprehend great danger in the progress of events, that the The first fact upon which the question dePresident will deem it proper to call on Con- pends is, does the Government want the money? gress for power, through his Secretary, to lend And, if it does, is it not better that she should money at least to the extent of the surplus rev-keep her own and use it, than to deposit it with enue; and that Congress, in obedience to Ex- the States and run in debt for an equal amount ecutive recommendations, will sanction the pro- to supply her own wants? To convince the ject. The Secretary now says, in substance, in committee that the amount of the fourth instalthe 9th page of his late report, that "it is im- ment of the deposits would be wanted by the possible to conduct our fiscal operations any Government for her own use, he had prepared length of time with ease, vigor, and uniformity, a statement, which was the result of a calculawithout some such regulator as a power to issue tion from the facts stated in the report of the and redeem Treasury notes, or to invest and Secretary of the Treasury, and he believed it sell the investment of surpluses." I am appre- would be found correct, and conclusively show hensive that a power to lend the surplus would, that Government would want the full amount in the Secretary's estimation, be found a better of the fourth instalment. In submitting the "regulator," and that the whole scheme of sub-statement, he would acknowledge his obligation treasuries will eventuate in a Government bank, where the money of the nation will be loaned out at the will and pleasure of the President. Should such a state of things ever arrive, and if there is no curtailment of Executive power, as claimed and exercised by the late President, I am ready to declare that American liberty exists no longer. The people will become the mere slaves of power, and nothing short of revolution will burst their chains.

Mr. PICKENS said he would submit a proposition which he thought would meet the views of a large majority of both sides of the House, and that was to postpone the payment of the instalment to the "1st day of January, 1839," by which time it would be seen if the postponement should be made indefinite or not. Mr. P. then moved to strike out the words "till further provision by law," and insert "the 1st day of January, 1839."

Mr. DUNCAN said he was anxious for the passage of the bill. There was more than one consideration that operated on his mind and induced him to support it. The object of the deposit act was to relieve the Treasury of the surplus revenue-a surplus which, as he would

to the worthy and distinguished gentleman from Maryland, (Mr. McKIM,) for the assistance he had received from him in preparing the statement.

[Here Mr. Duncan submitted his statement.]

If, said Mr. D., the report of the Secretary of the Treasury is a correct and true exposition of the state of the Treasury and the finances of the nation, then his statement proved, beyond all doubt, that the money proposed to be deposited as a fourth instalment was required for the use of the Government, and it disposed of the main question.

But to return to the subject of this bill. Is it good policy for the Government to deposit her money with the States, for their use, when she wants to use it herself? The decision of this question seemed to him a small business. Present the naked question, and there was no schoolboy in the district he had the honor to represent who did not carry the answer on the end of his tongue. What was there about the question that prevented it from being a plain, easy question to answer? We are told that there exists a contract between the Govern

H. OF R.]

Fourth Instalment Bill.

[SEPTEMBER, 1837.

The Fourth Instalment Bill.

The question pending was on the amendment of Mr. PICKENS to strike from the bill the indefinite clause "till further provision by law," and insert "the first day of January, 1839."

Mr. JONES, of Virginia, said: It has been contended, that an expectation has been raised on the part of the States, that the transfer would be made; that, upon the faith of that expectation, the States had actually gone on to appropriate the amount; and that such expectation should not now be disappointed. This, sir, may be true, and I doubt not is true, as to many of the States; it may be that the course of legis

ment and the States that is binding in law, in | bankrupt law at this special session of Conequity, and in conscience; that Congress, by a gress. solemn act, had agreed to deposit the surplus revenue with the States for safe-keeping, provided the States would agree to receive it, and that the States had agreed to the only condition necessary to complete the contract, viz: to receive them. Therefore, the States were entitled to the full benefit of the contract, and in good faith the money ought to be paid over. What miserable sophistry! What pitiful subterfuge to cover nakedness and deformity, and how far from every true principle connected with the question! What is the title of the deposit act? "An act to provide for the deposit of the surplus revenue, and safe keeping of the same." Is there any thing in the title of this act that authorizes the belief that Con-lation on the part of the States may subject gress intended that the States should have any them to very serious inconvenience, and possiother benefit from the public moneys than a bly to loss. But the inquiry immediately redepositor should have from any general deposit? curs: Whose act was it that produced the diffiIs there any expression in the body of the act culties with the States? It was the action of that conveys any other meaning? On the con- the States themselves through their Legisla trary, is it not full of provisions by which such tures; action, too, taken by them, with full inferences are studiously foreclosed and avoid- knowledge that the money so applied was neied? Does not the act provide the manner in ther given nor loaned, but merely deposited; which the Secretary of the Treasury shall recall liable to be called for at any moment when the them whenever the circumstances of the Gov- wants of the Government should render necesernment may require? Did the supporters of sary its return. And the argument from inconthat law attempt to convey the idea, or advance venience, if it be worth any thing, is just as the argument, when it was under consideration, conclusive to prove that the amount, when dethat the surplus revenue, in the form of a de- posited, could at no future day be called for; posit, was really to be a gift to the States? for I presume it will never be entirely convenNo, sir. At the time the bill was under con-ient to pay back the amount. It proves that sideration, there was no idea held out or advanced other than that the money was to be placed with the States for safe-keeping. But gentlemen who rejoice at the embarrassed state of the Treasury, and who are shouting that their former predictions of misrule and ruin are verified, are willing, in violation of the meaning, spirit, and express words of the deposit law, to withhold from Government the necessary funds of conducting its only legitimate operations, and that, too, for party effect; so that possibly what they heretofore predicted, and now declare has happened, may yet, peradventure, prove true. But in what section, sentence, word, or syllable of that act is the provision to warrant the statement that the Government is pledged to deposit with the States the means of her own, which are necessary to conduct her own concerns? Sir, such a construction of the act, and such a policy, is revolting to every economist and correct judge of ordinary dealings and business habits.

THURSDAY, September 21.
Bankrupt Law.

Mr. THOMAS, chairman of the Committee on the Judiciary, rose and stated that he had been instructed by that committee to state to the House that the committee had this day adopted a resolution that it is inexpedient to report a

what was intended and declared to be a mere deposit for safe-keeping, was, in truth and in fact, a gift, absolute and unconditional; that such was never the intention of Congress is rendered too plain by the terms of the law itself to admit even of doubt.

But suppose it shall now be determined to pay over the fourth instalment to the States; how is the amount to be raised? It is not in the Treasury; for to all practical purposes we have very nearly an empty Treasury: by this I mean that the available means, at the disposal of the Secretary, are not sufficient to meet the demands upon it. How, then, is the money to be raised? I presume by a loan of some kind, with the faith of the Government pledged for its redemption; but ultimately to be discharged, and paid off, through the ordinary channels of taxation upon the people. It follows, then, that the people are to be taxed to raise money to distribute among the people. You most graciously give them with one hand, and take back with the other a like amount; increased, however, by the costs, and charges of collection; and, also, by the amount of interest that may have accrued on the loan. The conclusion seems to me inevitable, that the passage of the bill now under consideration will give to the fourth instalment its proper direction, by placing it in a condition to be applied to the legitimate purposes of the Government, for which it was originally intended.

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