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1258 Oct. 5, 1837.] Sub-Treasury Bll—Treasury Notes. [H. of R.
proposition submitted by the gentleman from Pennsylvania, to refer this resolution to the Committee of the Whole on the state of the Union. Mr. CUSHMAN said that, believing every gentleman to have made up his mind on the question in relation to the expediency of chartering a national bank, and that the state of the public business would not permit of its further discussion, he moved the previous question. Mr. HAYNES moved a cali of the House, which was ordered; and the roll having been called over, and 195 members answering to their names, Mr. MORGAN moved to dispense with all further proceedings under the call; which was agreed to. The previous question was then seconded—ayes 83, noes 80. Mr. REED called for the yeas and nays on ordering the main question; which were ordered, and were: Yeas 101, nays 101, as follows: YEAs—Messrs. Anderson, Andrews, Atherton, Beatty, Beirne, Bicknell, Birdsall, Bouldin, Bruyn, Buchanan, Bynum, Cambreleng, T. J. Carter, Chapman, Claiborne, Clark, Cleveland, Coles, Connor, Craig, Crary, Cushman, Davee, Dromgoole, Duncan, Edwards, Elmore, Fairfield, I. Fletcher, Fry, Gallup, Gholson, Glascock, Gray, Haley, Hammond, Hamer, Harrison, Hawkins, Haynes, Holry, Holt, Hopkins, Howard, Hubley, W. H. Hunter, Ingham, T. B. Jackson, Jabez Jackson, Joseph Johnson, N. Jones, J. W. Jones, Kilgore, Klingensmith, Leadbetter, Logan, Arphaxed Loomis, J. M. Mason, McKay, A. McClellan, McClure, McKim Miller, Montgomery, Moore, Morgan, S. W. Morris, Noble, Owens, Palmer, Parinenter, Paynter, Pennybacker, Petrikin, Phelps, Pickens, Plumer, Potter, Pratt, Prentiss, Reily, Rhett, Rives, Sheffer, Shields, Sheplor, Smith, Spencer, Stewart, Taylor, Thomas, Titus, Toucey, Turney, Wanderveer, Wagener, Webster, Thomas T. Whittlesey, J. W. Williams, Worthington, Yell—101. NArs—Messrs. Adams, H. Allen, John W. Allen, Avcrigg, Bell, Biddle, Borden, Wm. B. Calhoun, John Calhoon, Wm. B. Campbell, Casey, Chambers, Cheatham, Childs, Clowney, Corwin, Cranston, Crockett, Curtis, Cushing, Darlington, Dawson, 1)avies, Deberry, Dennis, Dunn, Everett, Ewing, R. Fletcher, Rice Garland, Goode, J. Graham, Wm. Graham, Grennell, Hall, Halsted, Harlan, Harper, Henry, Herod, Robert M. T. Hunter, Jenifer, Henry Johnson, William Cost Johnson, Lawler, Lewis, Lincoln, Andrew W. Loomis, Lyon, Mallory, Marvin, Samson Mason, Martin, Maury, May, Maxwell, McKennan, Menefee, Mercer, Milligan, M. Morris, Calvary Morris, Naylor, Noyes, Ogle, Patterson, Patton, Pearce, Peck, Phillips, Pope, Potts, Rariden, Reed, Rencher, Ridgway, Robertson, Rumsey, Russell, Sawyer, Sergeant, Augustine H. Shepperd, Charles Shepard, Slade, Snyder, Southgate, Stratton, Taliaferro, Thompson, Tillinghast, Toland, Underwood, A. S. White, John White, Elisha Whittlesey, Lewis Williams, S. Williams, J. L. Williams, C. H. Williams, Wise, Yorke—101. The CHAIR voted in the affirmative, so that the main question was ordered to be now put. Mr. CLARK inquired if it would now be in order to move to lay the suoject over until to-morrow. The CHAIR replied that it would not be in order, the main question being ordered to be now put. The main question was then reported as follows: ba old. That it is inexpedient to chart, or a national nk. Mr. WISE called for the yeas and nays on the main question, which were ordered, and were: Yeas 123, nays 91, as follows: YEAs—Messrs. Anderson, Andrews, Atherton, Beatty, Bierne, Bicknell, Birdsall, Bouldin, Brodhead, Bruyn, Buchanan, Bynum, Cambreleng, T. J. ( Sarter, Casey,
Chapman, Cilley, Claiborne, Clark, Cleveland, Clowney, Coles, Connor, Craig, Crary, Cushman, Dawson, Davee, Dromgoole, Duncan, Edwards, Elmore, Fairfield, Isaac Fletcher, Fry, Gallup, Gholson, Glascock, Grantland, Gray, Griffin, Haley, Hammond, Hamer, Harrison, Hawkins, Haynes, Holsey, Holt, Hopkins, Howard, Hubley, William H. Hunter, R. M. T. Hunter, Ingham, T. B. Jackson, J. Jackson, Joseph Johnson, N. Jones, J. W. Jones, Kilgore, Klingensmith, Legare, Leadbetter, Lewis, Logan, Arphaxed Loomis, Lyon, Mallory, J. M. Mason, Martin, McKay, A. McClellan, McClure, McKim, Miller, Montgomery, Moore, Morgan, M. Morris, S. W. Morris, Muhlenberg, Noble, Ogle, Owens, Palmer, Parmenter, Patton, Paynter, Pennybacker, Petrikin, Phelps, Pickens, Plumer, Potter, Pratt, Prentiss, Reily, Rhett, Rives, Robertson, Sheffer, Shields, Sheplor, Smith, Snyder, Spencer, Stewart, Taliaferro, Taylor, Thomas, Thompson, Titus, Toucey, Towns, Turney, Wanderveer, Wagener, Webster, T. T. Whittlesey, Jared W. Williams, Worthington, Yell–123. NAys—Messrs. Adams, Heman Allen, John W. Allen, Aycrigg, Bell, Biddle, Bond, Borden, William B. Calhoun, J. Calhoon, William B. Campbell, Chambers, Cheatham, Childs, Corwin, Cranston, Crockett, Curtis, Cushing, Darlington, Davies, Deberry, Dennis, Dunn, Everett, Ewing, Richard Fletcher, Fillmore, Rice Garland, Goode, James Graham, William Graham, Graves, Grennell, Hall, Halsted, Harlan, Harper, Hawes, Henry, Herod, Jenifer, Henry Johnson, William Cost Johnson, Lawler, Lincoln, Andrew W. Loomis, Marvin, Samson Mason, Maury, May, Maxwell, McKennan, Menefee, Mercer, Milligan, Calvary Morris, Naylor, Patterson, Pearce, Peck, Phillips, Pope, Potts, Rariden, Randolph, Reed, Rencher, Ridgway, Rumsey, Russell, Sergeant, Augustine H. Shepperd, Charles Shepard, Sibley, Slade, Southgate, Stanly, Stratton, Tillinghast, Toland, Underwood, A. S. White, John White, Elisha Whittlesey, Lewis Williams, Sherrod Williams, Joseph L. Williams, Christopher H. Williams, Wise, Yorke—91. So the House resolved that it is inexpedient to charter a national bank." The House then proceeded to the orders of the day.
The bill from the Senate, entitled “An act imposing additional duties in certain cases on public officers,” was taken up on its reserence.
Mr. CAMBRELENG remarked that, as this bill corresponded in almost all its provisions with the House bill under the same title, reported by the Committee of Ways and Means, and referred to the Committee of the Whole on the state of the Union, in order, therefore, that there might be no delay upon the action of this bill, and as there was only one slight difference between them, he had been instructed, he said, by the Committee of Ways and Means to move that this bill be at once committed to the same Committee of the Whole as the other.
The motion was assented to, mem. dis.
Whole, and a substitute submitted by Mr. CAMBRELENG adopted. Mr. RHETT moved to amend the first section by inserting in the second line, after the word “notes,” the following: “ or bills receivable in payment of the public dues;” and supported his amendment at some length, and went somewhat into the subject generally, Mr. FLETCHER, of Massachusets, said it was his intention not to take any part in the present debate, but looking at the character of the bill before them, and considering the circumstances in which they were placed with regard to it, he was not able to content himself with giving a silent vote upon the measure. I consider it due to my constituents and due to myself, (said he,) briefly to state the reasons which will influence my conduct upon the present occasion. The real object of the bill is, to borrow ten millions of dollars upon the credit of the Government; and, if it passes, its real effect will be, to impose a debt upon the country to that amount. To justify me in voting for such a bill, two things must be clearly established : 1st. that the wants of Government are so pressing as to render it necessary to impose on the people a debt of ten millions of dollars; 2d. that the method in which it is proposed to accomplish this object is a proper and suitable method. I presume no one will call in question the correctness of my first position, or deny that the necessity of running the nation in debt must be clearly proved before any such step can be properly taken. The people will not look with favorable eyes upon the recommencement of a national debt; they will not consider it a light matter; such a measure can only be justified by necessity. If the Government has any pre-existing means to meet its wants, those means must be resorted to in the first place; and till those means are exhausted there can be no occasion for imposing a debt upon the people, nor propriety in doing so. Upon this point, how stands the fact 1 In the statement read to us by the chairman of the Committee of Ways and Means, exhibiting the resources out of which, in the course of the ensuing year, the proposed Treasury notes are to be paid and redeemed, he includes six millions due to the Government from the Bank of the United States; that is, there is due from the bank six millions of dollars, payable in three successive years, with interest, at six per cent., the whole of which it is intended to convert into cash, in the course of the ensuing year, to provide the means wherewith to redeem and take up the proposed Treasury notes. With these bonds of the bank in the vaults of the Treasury, for six millions of dollars, it is proposed to issue Treasury notes, pledging the credit of the country, and to meet and redeem those notes these very bonds are to be sold and disposed of Pray, sir, where is the necessity, the advantage, or the propriety of this double operation 1 Undoubtedly the money which is wanted may as well be raised by the sale of the bonds now, as by the issue of Treasury notes. It is proposed that the notes shall bear interest—though the amount is not fixed in the bill—and shall be payable in one year. The bonds are upon interest at six per cent., and have a longer time to run than the proposed notes. The bonds will serve much better than the notes for foreign remittance, and undoubtedly would command a premium in the market. The notes are payable too soon, and, in other respects, not well fitted for foreign remittance. Now, sir, I should be glad to hear some satisfactory reason why these bonds should not be sold at once, and the proceeds applied to the wants of the Government. Would not this be a better course, a more direct, a more judicious course, than to borrow money and impose a debt upon the country Why accumulate these different funds in the hands of the Government 3 Why resort to such an involved and round-about plan of raising money ! Why not go into the market with the bonds of the bank! Why sub
stitute for them your own notes ? To sell the bonds is a very simple and common operation, such as approves itself to every man's experience and understanding. If there are any reasons for the extraordinary course which it is proposed in preference to pursue, they have not yet been explained to my comprehension. In addition to the bank bonds, there are some fifteen or sixteen millions of dollars belonging to the Government, still in the deposite banks. Upon this fund the Secretary has been in the practice for some time past of making drafts, which, though not paid by the banks, have been received for dues to the Government, and have gone into circulation, and have formed a part of the currency of the country. The drafts, as the Secretary of the Treasury informs us, have been found convenient to the Government and to the people. They have served to pay the debts of the Government to individaals, and of individuals to the Government. Why should not this process, a tried and successful process, be continued so far as may be necessary 4 Here is an actual existing fund, upon which we may draw, and upon which we may rely for ultimate payment. We are assured that these banks are amply solvent, and will pay, if not immediately, yet gradually, and in the end fully. This fund the Government can control and use; it has been and will continue to be under their management; and to issue these proposed Treasury notes is only accumulating fund upon fund in the hands of the Executive. This is in accordance neither with public policy nor approved practice. Nothing beyond the real wants of the Government can be properly supplied. If there be already means on hand to meet the wants of the Government, to accumulate new funds in their hands would be an outrage upon the rights of the people; it would be dangerous in principle, oppressive and unjust in practice. Sir, I do not mean to make light or unfounded objections. Show me that the wants of the Government demand a loan, and I will go for a loan, heartily and sincerely; I should feel myself bound in duty and in conscience to go for it; but, until the necessity for it appears, I feel myself bound in duty, bound in justice to the people, to oppose it. Now, the necessity of imposing upon the country a debt of ten millions has not been made apparent to my mind; so far from it, the contrary clearly and distinctly appears. But, suppose the administration to have made out the necessity of involving the country in a debt of ten millions, still the mode in which they propose to effect that object is subject to strong objections. The bill before us is indirect and deceptive; calculated to conceal the real nature and object of the measure which is proposed. It is entitled a bill to authorize the issue of Treasury notes. Why not call it a bill to authorize the employment of additional clerks Or, a bill to punish forgery in certain cases? Both of which are just as much provided for in the bill as is the issue of Treasury notes: and either of which would just as well express the real object of the bill as the title which it bears. The bill bears a false title; it carries upon its front a false name; it imports what it is not; or rather it does not import what in fact it is; it is deceptive. Wherever else designing artifice may prevail, let it not corrupt our legislation. Let us deal frankly and operly with the people. When we take their money, let us tell them so; let it be taken openly and avowedly, not covertly and indirectly. Take their money and tell them so; but do not pick their pockets' When the people are to be subjected to a liability of ten millions, they should be informed of the fact clearly and distinctly ; there should be no concealment in word or thought. The bill before us is, in truth, a bill to authorize a loan of ten millions. What we want is a loan; and we ought in fairness and truth to say so. To call the bill by a name that does not fairly import its character; thus
to treat it as solaething different from what it really is, does not comport with what ought to be the character of the Government. We have already, sir, passed a bill entitled an act to postpone the fourth instalment of deposite with the States. I fear, sir, that bill raises expectations only to disappoint them. That payment, if it were really intended, might as well be made now as ever. I fear, sir, the States will expect it in vain. Postponement, in all probability, will turn out to mean repeal. The expectation of payment at a future time will prove, I apprehend, a delusive expectation. Sir, I protest against duplicity in any form, on the part of the Government. The relation which we sustain towards the people demands from us the strictest truth and sincerity. They have placed confidence in us; they have entrusted to us their rights and interests; and they have an undeniable claim to be informed fully and clearly, without disguise, as to every thing we do, and every thing we intend. The title and the form of this bill are calculated, in my opinion, to disguise from the people that we are borrowing money upon their credit; and, in that point of view, the bill is obnoxious to serious objections. There is another objection, which must press with great weight upon those gentlemen who hold to a strict construction of the constitution, who hold that Congress has no powers except those expressly granted to it. Those gentlemen, who cannot find in the constitution any power to charter a national bank, where do they find the power to issue Treasury notes, or bills of credit; for Treasury notes, designed to circulate as currency, are neither more nor less than bills of credit? No such power is any where expressly granted. The framers of the coustitution had seen and felt the evils of Government paper money. The power to issue bills of credit was expressly withheld from the States; it was not expressly given to the General Government. How, then, does the General Government obtain it! It will be said that it is included under the power to borrow money. Let us see how that interpretation will answer. No one will deny to the several States the power to borrow money—a power which they exercise every day without objection. But it is certain that the States cannot issue bills of credit. The power to borrow money, then, does not necessarily include the power to issue bills of credit; and, although the Government has undoubtedly the power to borrow money, that power to borrow does not, by any means, necessarily imply a power to issue bills of credit. I found this argument upon the views of those gentlemen who hold to a strict construction of the constitution, without intending to express any opinion of my own upon this constitutional point. The only exercise of this power by the General Government occurred during the late war with Great Britain. The Government, in the first place, endeavored to obtain a loan in the usual way. The attempt failed; the loan could not be obtained; and, as a matter of necessity, the Government resorted to a forced loan, by the issue of Treasury notes. An example at such a time, and under such circumstances, is rather to be avoided than to be followed. There is still a further objection to this measure. The bill provides that the notes to be issued shall bear such interest as the Secretary of the Treasury shall determine. This omission to fix the amount of interest leaves the character of the notes wholly indeterminate and uncertain. The interest which they may bear will determine the character and office of the notes. They may be of a character to be taken up as an investment by capitalists; they may be of a character to circulate as currency; and which of these characters they will assume, depends upon the interest they may bear. Before I can vote for the bill, this point must be determined. Before I can vote for the notes, I unust know what the notes are to be. I cannot agrec to
the passage of any bill the nature of which is not fixed and established by the bill itself. It would be to act blindly and inconsiderately, to vote for a measure in ignorance of what that measure is to be. Should the bill pass in the present form, and should I be inquired of what its effect upon the community was anticipated to be, I could give no answer. I could express no opinion on that point, because, in the present shape of this bill, it is impossible to form any opinion what character the notes will assume. I could only say, what I should be ashamed to say, that the Executive had been authorized to issue notes to suit the purposes of the Government, without any regard having been paid to the concern which the community at large might have in this matter. If we are to act with the slightest regard to the interest and convenience of the public, we should fix the interest which the notes are to bear. Why refer this to the Executive 1 Is not the House competent to form and exercise a judgment on this question ? Is not the House as fit as the Executive to determine what rate of interest, what character to the notes, will best subserve the public interest? If it be best for the Executive to legislate upon this point, why not upon all others? Though the Executive, in fact, exercised such a power, it would hardly be necessary to make a public proclamation of it. The earnestness with which the friends of the administration press this measure of issuing Treasury notes, in preference to the usual mode of supplying the wants of the Treasury by a simple loan, is well calculated to excite suspicions. I have no desire to throw any undeserved odium upon the administration. I wish them to merit, and, by meriting, to possess the confidence of the entire community. But this measure is little calculated to produce that effect. It is an unusual measure; it will be attended with extraordinary expense; it will add to the number of those in the employ of Government; it will increase Executive patronage; it opens a new door to Executivo savoritism. In raising money upon these notes, the Executive may give a preference, and may consult the interests of savored individuals; whereas a loan would be open equally to all. Besides, sir, there are those who see in this measure the commencement of a permanent and a most perilous system. It is more than surmised that the Government would be willing to have the whole currency of the country flow exclusively from itself; and is desirous to furnish not only the gold and silver coin, but the whole paper currency also, from its own exclusive mint; and that the measure now proposed is the first step in the march towards that object. The taking measures to render safe and convenient such currency as the people may elect to use, is the business and all the business of the Government in relation to this subject. It should be kept strictly within the limits of that duty, and should faithfully perform what belongs to it within those limits. They ought to follow public sentiment in this matter, not attempt to lead it. But strange and dangerous doctrines have been put forth in relation to the currency of the country ; and there is cause enough for alarm to render it the part of prudence to watch with care every measure bearing upon this subject. The issue of paper inoney is at all times a dangerous business for a Government to engage in; and a business peculiarly dangerous at the present crisis. Our time is now too short, our action too hurried, to justify us in adventuring upon a scheme of a novel character. At such a time, and under present circumstances, the only safe way is the old way—the common way. If the Government must have money, let it borrow the money in the usual mode. So doing, we shall know what we do. To the adoption of this course, I have heard no substantial objection, I can see no substantial objection; and, until I can obtain some new light, it is the only course to which I can give my assent. A great change has come over our national affairs. At
the commencement of this present year, there was in the hands of the Government a surplus of nearly twelve millions of dollars, exclusive of the whole amount to be deposited with the States. The fourth instalment of the deposite money (between nine and ten millions) has been withheld from the States; there is due to the Government from the late United States Bank six millions, exclusive of interest; and now ten additional millions are demanded, to meet the expenses of the current year; and this, too, besides all the ordinary revenues of the country—a country, whose whole annual expenses during the administration next preceding that of General Jackson were hardly twelve millions of dollars' Under circumstances like these, does it not behoove the people to look to their public affairs —to look to them at once —to look to them now !—to look to them cooly and dispassionately, with minds free from the influence of party spirit, and with a sincere and honest desire to preserve in its purity and excellence our free constitution, and to promote the prosperity and happiness of the people as well as of the Government Mr. CUSHING said it would be idle for him to think of adding any thing to the force and clearness of the observations of his colleague, [Mr. Fletch ER ;] but one of the remarks made by that gentleman had recalled to his recollection a curious fact, bearing upon the question at issue, which he begged leave to state to the House. It would be remembered, that one of the main arguments of those gentlemen who deny the constitutionality of a national bank, is the consideration that the power to establish such a bank is not expressly given to Congress in the constitution; that it is what is called a constructive power; and that a proposition was made in the convention which framed the constitution to confer on Congress power to create corporations, and rejected. Now (said Mr. C.) the analogy between this question of a naticnal bank, and that of bills of credit, is perfect in all its parts. There is no express power in the constitution for Congress to issue bills of credit. It is a constructive power, just as much as the power to establish a national bank; and Mr. Pinckney, of South Carolina, proposed, as may be seen by the printed journal of the convention, that, in the enumeration of the powers of Congress, one clause should read thus: “To borrow money and emit bills of credit.” This latter branch of the proposition the convention rejected : the actual provision as to loans being in these words: “To borrow money on the credit of the United States.” Mr. C. said that, without himself admitting the conclusiveness of the arguments adverse to the constitutionality of a national bank, he did not see how those who did entertain that view of the constitv'ion could consistently support a law for the emission of bills of credit. Mr. PARMENTER addressed the Chair as follows: Mr. Speaker: I have listened with great interest to the observations of my honorable colleague who has just taken his seat, [Mr. Fletchen,) as I always have elsewhere, when I have had an opportunity, from my great respect for his high moral worth and distinguished talents; but, entertaining somewhat different views from those presented by him and other gentlemen on the same side of the question, I will, with your leave, state the grounds upon which I dissent. My colleague assumes two conditions which he considers as indispensable prerequisites to the propriety of supporting the bill under consideration, which are: first, that the Treasury is in need of the money; second, that the proposed mode is the best one for raising the money. On the importance of establishing these points, I agree with him, and shall endeavor to show why I consider the present bill necessary, and the best calculated for the convenience both
of the Government and the people.
It has been remarked by several gentlemen during the debate, but not by my colleague, that they did not clearly comprehend the report of the Secretary of the Treasury, and they have avowed their inability to come to any definite conclusion as to the real state of the Treasury. This opinion was expressed and urged, immediately upon the report being laid upon our table, by members usually ardent in their political predilections and prejudices, quite as soon as it could be expected that so voluminous a document, embracing views of finance and public policy, as well as various statistics, could be examined.
Having long entertained the most favorable impressions of the superior talents of the Secretary of the Treasury, whose ability and assiduity in the duties of his high stations have been almost proverbial in the nation for many years, I read his report with great attention, and discovered, as I thought, a plain, lucid, and perspicuous view of the finances of the country. I put down, therefore, in my own mind the attacks upon him as the effusions of political opposition, without any more meaning than the general dissatisfaction of those who disagree with the present administration. I am the more confirmed in this impression, because, since the first few days of this session, after an opportunity of full examination, all this hostility to the report of the Secretary has ceased, and it appears to me to be generally considered a correct, able, and interesting. exposition of the finances and financial concerns of the country. I find by this report that there will be, in all probability, at the end of the year 1837, if there should be no deductions from the outstanding appropriations, a deficit of about twenty-two millions of dollars; but if, as the Secretary of the Treasury supposes, fifteen millions of dollars of unexpended appropriations may pass over to the year 1838, then there would be an absolute deficit of seven millions of dollars, to meet which, and for contingencies, and for the purpose of having a balance in the Treasury on the first of January, 1838, this bill propo
ses an authority to the Treasury Department to issue ten
millions of dollars of Treasury notes. This amount would have been nineteen or twenty millions of dollars, if the payment of the fourth instalment of the surplus revenue had not been postponed to January 1st, 1839; and it will be seen by the conditions of the postponement bill, that the Treasury is entirely cut off from getting back any of the twenty-seven millions distributed among the States, which by the original law the Secretary would have had a right to call for. Now, sir, my respected colleague would appropriate the nine and a half millions in deposite banks, and four and a half millions standing to the credit of disbursing officers in said banks, or as much as may be necessary to meet the wants of the Treasury. If this could be done there would, of course, be no need of issuing Treasury notes. But have we not a bill now before us, giving the deposite banks from four to nine months for the payment to the Government of the balances due 1 Is it not agreed, on all hands, that the security of the debt, the welfare of the people of the States interested, require an accommodation 1 Has not one of the Representatives of a State in which two of the deposite banks, having a large balance, are located, said on this floor that it would be impossible for the banks to pay within the time proposed by the bill now before us, and that he should ask for more time ! Is there the slightest doubt in this House that the bill from the other branch, now before us, must pass, or, if amended, by showing greater indulgence? This resource will then fail. As to the amount of four and a half millions in the hands of disbursing officers, there must always remain from three to five millions of dollars in their hands. All experience has shown such amount to be necersary. These sums are drawn to pay contracts actually fulfilled, and always belong to the creditors of the Government, and are, of course, entirely useless for a supply to the Treasury. Unless the operations of Government totally
stop, it must be obvious that there always will be some few millions of dollars in the hands of the disbursing officers of the army, navy, Indian department, and other objects of expenditure, awaiting the call of creditors of the Government. He also thinks that it would be proper to sell the bonds of the United States Bank of Pennsylvania, which are held by the Treasury Department. It appears to me that there are to this proposition several objections. that it would be exactly proper to put those bonds into market. It might, by possibility, have an injurious bearing upon the institution. If so, it ought not to be done, as an act of justice. It is not like an ordinary mercantile transaction. The directors of the bank undoubtedly had some object in view in fixing annual payments, and I hope the Government will never give a cause of complaint to ihis institution of the slightest character. Where will these bonds be sold 1 My own opinion ls, that the bank would purchase its own bonds. It appears to me it would be unwilling to multiply and vary its obligations in the stock market. It has already post notes on the London Exchange; and, it appears to me, it would be unwilling to have these bonds there. If, then, these bonds should now go into the market, and the bank should think proper to purchase them, the debtors of the bank must necessarily be called upon, and thus distress the commercial and trading community to that amount. If sold in Europe, (London most proably,) it would, to the amount of six millions of dollars, afford facilities for again over-trading, instead of being enployed to relieve our own country. I do not believe that at this time there is a very large unpaid amount of good debts from American to English merchants. The fall in exchange and specie shows that it is very much diminished, and, it appears to me, we ought to avoid any course which would tempt to excesses in our foreign importations in the slightest degree. But the objection of substituting the sale of these bonds for the Treasury notes is still greater in another view. It is an object to make this issue of Treasury notes incidentally beneficial to the community, by furnishing a means of remittance, and one of a very valuable character. The Treasury notes would flow from the disbursing points to the communities who may want them for remittances. The West and South would receive them in payment of debts, or for the sale of their cotton and other great products, as well as for lands held by individuals and companies. They would find their way back to the Atlantic cities, forming a highly valuable circulating medium perhaps until the time arrives, which cannot be very far distant, of a resumption by the local banks of specie payments.
It has been argued that it would be preferable to authorize a loan in the form of certificates of stock. This appears to be liable to as exceedingly strong objections as any which would apply to the sale of the bonds of the United States Bank. So far as it relates to the incidental benefit to the commercial community, it would be a slugglish operation. The stock would be all taken in the large cities, and the proceeds pass directly to the Treasury, where it would remain until called for by the Government creditors, and perform none of the offices of a means of remittance. But my colleague and other gentlemen say, you do not need Treasury notes, because you can continue to make Treasury drafts, and they will hereafter answer as they have heretofore. If these drafts were, in every particular, as beneficial as Treasury notes, they would be objectionable, inasmuch as they go to the world with the stamp of dishonor upon their face; they carry with them, as they pass from hand to hand, an indelible record of the discredit of the bank upon which they are made, and are therefore to be shunned and discarded as soon as possible, as offensive to the merchant who has a just sense of the importance of credit and punctuality. They are, moreover, inconvenient in amount, and unsuited to the habits and usages of the people.
I am not certain
My colleague objects to the bill, because no rate of interest is specified; and he cannot give it his vote until he knows precisely what the obligations of the Government are to be. It appears to me that this is one of the most valuable provisions of the bill, because the rate of interest can be so fixed all the way from a very low rate to the maximum of six per cent. that the Secretary of the Treasury will put it at the most advantageous rate for the Government and for the community. And it appears to me the rule would be a very plain one, to place the rate so that they would not be hoarded by the capitalists, or fall below par in the market, however small the demand for Government dues. And although, as has been strongly urged, there is very small probability that, under almost any circumstances, they would be below par, yet it is better, in my judgment, to leave the whole matter to the discretion of the Secretary of the Treasury, who will understand best what the wants of the case may require.
It is objected, that the issue of Treasury notes is unconstitutional ; that they are bills of credit, and prohibited by the constitution of the United States; that they were never issued in but one instance, and that during the war with Great Britain, when it was difficult or almost impossible to obtain a loan. If it were unconstitutional to issue Treasury notes, the fact that we were at war, and it was difficult to obtain a loan in any other manner, would not have made it constitutional. I come to the conclusion myself, that Treasury notes were issued at that time for the same reason as now, because they are the most convenient to the Government and the people.
I have not entertained the opinion, Mr. Speaker, that the present embarrassments of this nation have arisen from what may be properly called general distress. I believe, and think I shall be sustained in the opinion by the sentiments of many men of business in the commercial cities, that the stoppage of specie payments was owing to the alarm excited in the community, which caused a rush upon the banks for the precious metals, and thereby materially lessened their means, and by the imprudence and extended speculation into which the debtors of these institutions plunged. Had it not been for these circumstances, the suspension would not have taken place; and, but for
them, before this time specie payments would have been
resumed. It is true that the consternation was universal; the panic was overwhelming; but that the evil was not deep rooted, and that there was not, in reality, a scarcity of the precious metals in the commercial world, is shown by various facts. Contrary to the expectation ef, most persons in this country, the Bank of England continued, and still continues, specie payments, and money is abundant, and there is no want of coin and bullion for all purposes. The speculations and investments in lands, amounting to many millions of dollars; engagements in novel manufacturing concerns; building of railroads in all parts of the country; and establishments of every variety which ingenuity could invent—a few of them useful and profitable, but many, very many, most sorrowfully ruinous in their results—all tended to produce the mischief. The ordinary means of the banks were probably equal to their liabilities; but the inability of their debtors, in consequence of their imprudent and indiscreet course, crippled these institutions, and brought on the calamity of a suspension of specie payments—an evil which, while it continues, will blight every effort of enterprise and industry. The amount of specie within the control of the banks of the country was equal to their wants, greater than it has been in many instances and at many times; but unsafe and improvident men obtained access to their resources; not that I mean to censure the managers of the moneyed institutions more than I would individuals, and copartnerships, and corporations, for everybody was infected with the mania of speculation; the whole atmosphere of the