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principles which have been proved to be safe, and with any amendments which experience may have suggested. But, for himself, it was his stated purpose to do nothing more in relation to a national bank, till a decisive lead should be given in that direction by the public opinion.
In the next place, he wished to say, that the "experiment," upon the success of which gentlemen had felicitated themselves, had not, in his opinion, undergone any trial at all. It had been put to no test.
There are two public objects, both of great importance (said Mr. Webster), in the accomplishment of which the Bank of the United States, in my opinion, has been generally successful. I mean the transmission of public funds, and other facilities to the operations of the Treasury, as one of these objects; and a safe, cheap, and admirable system of internal exchanges, as the other. These objects were both attained, by the skilful administration of the Bank, to such a degree as left little or nothing to be wished. By interual exchanges, I intend the whole operation of internal bills of exchange, and the circulation, also, of a paper currency, always safe, founded on solid capital, and every where, in every nook and corner of the country, as well as on the exchanges of the great cities, always of the same value as gold and silver, except, indeed, where the bills of the Bank have been preferred to gold and silver, as being better suited to the purposes of remittance. Now, Sir, it has been predicted, that the State banks, selected as deposit banks, could equally well accomplish all these objects; that they could as readily, and as completely, facilitate the operations of the Treasury; and that they could, and would also, furnish a general currency, as sound and as well accredited ; and that they could and would be able to conduct the internal exchanges of commerce as safely and as cheaply. Of all this I have doubted; but the day of argument is passed, and the system now awaits the unerring result of experience. But the time for that experience has not yet arrived." Up to the present moment, the country has enjoyed, and does now enjoy, the benefit of the circulation of the bills of the Bank of the United States. The amount of that circulation is now eighteen or twenty millions, and it is diffused over every part of the country, and abounds, more especially, in those places where it is more particularly needed, and, indeed, is kept there because it is there most needed. Here is a medium of exchange, every where to be had, and to be had without charge. A hundred dollars in gold and silver buy a post-note of the Bank of the United States in New Orleans, or Mobile, or St. Louis, and it is remitted to Philadelphia or New York without danger and without expense. The whole mass of the circulation of the Bank of the United States, therefore, is, at this moment, in active operation, in expediting and
facilitating exchanges, and, indeed, in assisting the operations of the Treasury, and the deposit banks themselves, by affording a medium of universal credits. The present system, therefore, still rests, substantially, on the Bank of the United States.
It is the credit and the circulation of the bills of that Bank, which still sustain the accustomed operations of internal commerce; and the Bank still exercises all that wholesome control over the currency of the country, which it has heretofore done. But the Bank is about to expire. These eighteen or twenty millions must be gradually withdrawn from circulation, though they may come in very slowly, and be drawn very reluctantly, from the hands which hold them; so that the circulation of the bills may more or less continue for a considerable time after the charter shall expire. In this way I have no doubt of its continuance to do good, for some time after its legal existence shall have ceased. There will be no rush for payment of its notes and bills, because there will be no doubt about the sufficiency of the fund. There will be no haste to get rid of them, because they will be better than any other paper, and better than gold and silver.
But the Bank must wind up its affairs; its debts must be collected, and its circulation, after a while, entirely withdrawn. And when this takes place, or begins to take place, then, and not till then, the existing Government “ experiment” will begin to be put to the proof. At present, all is fair weather: the question is, How will it be, when it becomes necessary to fill up the void occasioned by withdrawing the bills of the Bank of the United States, by notes of the deposit banks ? When these banks shall be brought to rely on their owri means, their own credit, and their own facilities; when the substantial succor of a universally-accredited paper currency of twenty millions in amount shall be withdrawn, -then the "experiment” will be put on trial.
It is known, Sir, that I am one of those who believe in the impracticability of an exclusive, or of a general metallic currency. Such a currency is not suited to the age, nor to commercial convenience. The return of the golden age is a dream. There will continue to be banks; and the mass of circulation will be a paper circulation of some kind; and the question will be, whether State institutions, associated together as deposit banks, can furnish a sound and universally accredited circulation.
At present, they are not proved capable of any such thing. If a gentleman here wishes to remit money to New England, or to the Ohio river, he certainly does not send bills of the deposit bank of this District. If a single individual has done that, by way of trying the “experiment," he probably does not repeat the trial; and, at any rate, the example is not generally followed. The deposit banko pay specie, which is, so far, very well ; and a person with
a check on one of those banks can obtain specie, and with that specie he can obtain bills of the Bank of the United States; and this is the process he will go through, if he wishes to remit money, in the shape of bank notes, to places at any considerable distance. In fact, that is well known to be the only practice. How this is to be effected, when there shall be no longer notes of the Bank of the United States to be had, remains to be seen.
I have said, Sir, the day of trial bas not come, and that all as yet seems clear weather. But I have recently learned some symptoms of approaching squalls. Some little specks of clouds, at least, make their appearance above the horizon. I learn, from authority not to be questioned, that, within the last week or ten days, a Treasury warrant was drawn on a deposit bank in one of the cities, payable in another city. The bank on which the warrant was drawn offered to pay in a check, on a bank in the city where the warrant was payable ; and when the check was presented, it was found to be made payable in current bank notes. Here, I think, Sir, there is, as I have said, a small cloud darkening the early dawn of the new golden day of our currency. Even so soon as the present hour, Treasury drafts are thus offered to be paid in current bank notes. I have very good reason to believe, Sir, that other deposit banks draw their checks, in like manner, payable in current bank notes. And I have called the attention of the Senate to these occurrences, not merely to expose the practice, but to correct it also. I wish to stop it at the threshold, by declaring it illegal; and I have prepared a section, which, I trust, the Senate will see the importance of inserting in this bill.