View original document

The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.



















Digitized by tine Internet Archive

2009 with funding from

Friends of the Lincoln Financial Collection




The Senate

having resumed the consideration of the bill imposing additional
ol" the public moneys, on certain ofiicers of the General

as depositaries

Mr. CLAY rose and addressed
He commenced by observing that,

the Senate upwards of three hours.
feeling an anxious desire to see some
effectual plan presented to correct the disorders in the currency, and to restore the prosperity of the country, he had avoided precipitating himself into
the debate now in progress, that he might attentively examine every remedy
that should be proposed, and impartially weigli eveiy consiileration urged in
No period had ever existed in this countrj^ in which the luture
its support.
was covered by a darker, denser, or more impenetrable gloom. None, in
which the duty was so imperative to discard all passion and prejudice, all
party ties, and previous bias, and look, exclusively to the good of our afflicted

—and he thought


our present difit a fortunate one
from former domestic troubles, and that is their
They are felt, it is true, in ditteretit degrees, but they reach
every section, every State, every interest, almost every man in the Union.
All feel, see, hear, know their existence. As they do not array, like our
former divisions, one portion of the Confederacy against another, it is to be
hoped that common sufferings may lead to common sympathies and common
councils, and that we shall, at no distant day, be able to see a clear way of
deliverance. If the piesent state of the country were produced by the fault
of the People ; if it proceeded from their wasteful extravagance and their indulgence of a reckless spirit of ruinous speculation 5 if public measures had
no agency whatever in bringing it about, it would nevertheless be the duty of
Government to exert all its energies and to employ all its legitimate powers
to devise an efficacious remedy.
But if our present deplorable condition has
sprung from our rulers; if it is to be clearly traced to their acts and operations, that duty becomes infinitely more obligatory ; and Government would
be faithless to the highest and most solemn of human trusts should it neglect
And is it not too true that the evils which surround us are to
to perform it.
be ascribed to those who have had the conduct of our public affairs
In glancing at the past, (continued Mr. C.) nothing can be further from my
intention than to excite angry feelings, or to find grounds of reproach. It
would be far more congenial to my wishes that, on this occasion, we should
forget all former unhappy divisions and animosities. But, in order to discover how to get out of our difficulties, we must ascertain, if we can, how we
got into them.
Prior to that series of unfortunate measures which had for its object the
overthrow of the Bank of the United States, and the discontinuance of its
fiscal agency for the Government, no People upon earth ever enjoyed a better currency, or had exchanges better regulated, than the People of the United States. Our monetary system appeared to have attained as great perfection as any thing human can possibly reach. The combination of United


In one respect

ficulties are distinguishable


States and local banks presented a true image of our system of General and
State Guverninents, and worked quite as well. Not only within tiie country
had we a local and a «eneral currency perfectly sound, but in Mliatever quarter ol' the globe American commerce had penetrated, there also did the bills
ol the Bank of the United States command unbounded credit and confidence.
Now we are in danj^er of having fixed upon us, indefinitely as to time, that
medium an irredeemable paper currency, which, by the universal consent
How has this reverse
of the commercial world, is regarded as th.e worst.
come upon us ? Can it be doubted that it is the result of those measures to
which 1 have adverted : When, at the veiy moment of adopting them, the
very consequences which have happened were foretold as inevitable, is it
necessary to look elsewhere for their cause ? Never was prediction more
distinctly made j never was fulfilment more literal and exact.
Let us suppose that those measures had not been adopted ; that the Bank
of the United States i;ad been rcchartered ; that the public deposites had
remained undisturbed ; and that the Treasury order had never issued : is
there not every reason to believe that we should be now in the enjoyment ol"
a sound currency ; that the public dtposites would be now safe and fortlicoming ; and that the suspension of specie payments in May last would not


have happened


President's message asserts that the suspension has proceeded from
over-action over-trading the indulgence of a spirit of speculation produced
by bank and other facilities. 1 think this is a view of the case entirely too
It would be quite as correct and just, in the instance of a homisuperficial.
cide perpetrated by the dischaige of a gun, to allege that the leaden ball, and
not the man who levelled the piece, was responsible i'or the muider. The
true inquiry is, how came that excessive over-trading and those extensive bank
Were they not the necessary and
lacilities which the message describes ?
immediate consequences of the overthrow of the bank, and the removal
irom its custody of the public deposites ? And is not this proven by the vast
multiplication of banks, the increase of the line of their discounts and accommodations, prompted and stimulated by Secretary Taney, and the great
augmentation of their circulation which ensued.^
What occurred in the State of Kentucky, in consequence of the veto of
the recharter of the Bank of the United States, illustrates its ettects throughout the Union. That State had sutlered greatly by banks. It was genei ally
opposed to the re-establishment of them. It had found the notes of the Bank
of the United States answering all the purposes of a sound currency at home
and abroad, and it was perfectly contented with them. At the period of the
veto, it had but a single bank ot limited capital and circulation. Alter it, the
State, reluctant to engage in the banking system, and still cherishing hopes of
the creation of a new Bank of the United States, encouraged by the supporters of the late President, hesitated about the incorporation of new banks.
But, at length, despairing of the establishment of a Bank of the United States,
and finding itself exposed to a currency in bank notes from adjacent States,
it proceeded to establish banks of its own, and since the veto, since 1833, has
incorporated for that single State bank capital to the amount of ten millions
of dollars— a sum equal to the first Bank of the United States created for the




whole Union



the local banks, to which the deposites were transferred from the Bank
of the United States, were urged and stimulated freely to discount upon them,
we have record evidence from the Treasury Department.
The message, to reconcile us to our misfortunes, and to exonerate the measures of our own Government from all blame in producing the present state of
things, refers to the condition of Europe, and especially to that of Great Brit" in both countries we have witnessed the same redunain.^ It alleges that
money, and other facilities of credit : the same spirit of specdancy of paper
ulation ; the same partial successes ; the same difficulties and reverses ; and,
at length, nearly the same overwhelming catastrophe."
The very clear and able argument of the Senator from Georgia (Mr. Kino)
relieves me from the necessity of saying much upon this part of the subject.


It appears that during the period referred to
there was, in fact, no angtnentation, or a very

by the message, of 1833-4-5,

trifling augmentation, of the
circulation of the country, and that the message has totally misconceived the
actual state of things in Great Britain. According to the publications to which
I have had access, the Bank of England in fact diminished its circulation,
comparing the first with the last of tiiat period, about two and a half millions
sterling ; and although the joint stock and private banks increased theirs, the
amount of increase was neutralized by the amount of diminution.
If the state of things were really identical, or similar, in the two countries,
But is that the case? In
it would be fair to trace it to similarity of causes.
Great Britain a sound currency was preserved by a recharter of the Bank of
England about the same time that the recharter of the Bank ol the United
States was agitated here. In the United States we have not preserved a sound
currency, in consequence of the veto. If Great Britain were near the same
catastrophe (the suspension of specie payments) which occurred here, she
it; and this difference in the condition of the two
countries makes all the difference in the world. Great Britain has recovered
from whatever mercantile distresses she experienced: we have not ; and
when shall we.^ All is bright and cheerful and encouraging in the prospects
whish lie before her 5 and the reverse is our unfortunate situation.
Great Britain has, in truth, experienced only those temporary embarrassments which are incident to commercial transactions, conducted upon the
scale of vast magnitude on which hers are carried on.
Prosperous and adverse times, action and reaction, are the lot of all commercial countries. But
our distresses sink deeper ; they reach the heart, which has ceased to perform
its office of circulation in the great concerns of our body politic.
Whatever of embarrassment Europe has recently experienced may be satisfactorily explained by its trade and connexions with the United States.
degree of embarrassment has been marked, in the commercial countries
there, by the degree of their connexion with the United States.
All, or almost all, the great failures in F^urope have been of houses engaged in the
American trade. Great Britain, which, as the message justly observes,
maintains the closest relations with us, has suffered most ; France next, and
soon, in the order of their greater or less commercial intercourse with us.
Most truly was it said by the Senator from Georgia that the recent embarrassments of Europe were the embarrassments of a creditor, from wimm payment
was withheld by the debtor, and from whom the precious metals have been
unnecessarily withdrawn by the policy of the same debtor.
Since the intensify of suti'ering, and the disastrous state of things in this
country, have far transcended any thing that has occurred in Europe, we
must look here for some peculiar and more potent causes than any which have
been in operation there. They are to be found in that series of measures to





have already adverted


The veto of the bank.
The removal of the deposites,

with the urgent injunction of Secretary

Taney upon the banks to enlarge their accommodations.
3d. The gold bill, and the demand of gold for the foreign indemnities.
4th. The clumsy execution of the deposite law ; and
5th. The Treasury order of July, 1836.
[Here Mr. Clay went into an examination of these measures, to show


the inflated condition of the country, the wild speculations, which had risen
to their height when they began to be checked by the preparations of the local
banks necessary to meet the deposite law of June, 1836, the final suspension
of specie payments, and the consequent disorders in tiie currency, commerce,
and general business of the the country, were all to be traced to the influence
of the measures enumerated. All these causes operated immediately, directly, and powerfully upon us, and their eftects were indirectly felt in Kurope.]
The message imputes to the deposite law an agency in producing the existing embarrassments.. This is a charge frequently made by the friends of the administration against that law. It is true that the banks having increased their
accommodations, in comformity with the orders of Secretary Taney, it might

and pay tliem over for public use. It is true
in which the law was executed by the Treasury Department, transferrins large sums from creditor to debtor portions of the country,
without regard to the commerce or business of the country, might have aggravated the inconvenience. But what do those who obji^ct to the law think ought to
rot have been convenient to \ecal

also, that the


have been done with the surpluses which had accumulated, and were daily
augmenting to such an enormous amount in the hands of the deposite banks?
Were they to be incorporated with their capitals, and remain there for the
benefit of the stockholders ?
Was it not proper and just that they should be
applied to the uses of the People from whom they were collected ? And whenever and however taken from the deposite banks, would not inconvenience
necessarily happen?
The message asserts that the Bank of the United States chartered by Pennsylvania, has not been able to save itself or to check other institutions, notwithstanding "the still greater strength it has been said to possess under its
charter." That bank is now a mere State or local institution. Why is it referred to, more than the Bank of Virginia, or any other local institution ? The
exalted station which the President tills forbids the indulgence of the supposition that the allusion has been made to enable the administration to profit
by the prejudices which have been excited against it. Was it the duty of that
bank, more than any other State bank, to check the local institutions ? Was
it not even under less obligation to do so than the deposite banks, selected
and fostered by the General Government r
But how could the message venture to assert that it has greater strength
than the late Bank of the United States possessed ? Whatever may be the liberality of the conditions of its charter, it is impossible that any single State
could confer upon its faculties equal to those granted to the late Bank of the
United States first, in making it sole depository of the revenue of the United
States ; and secondly, in making its notes receivable in the payment of all
public dues. If a Bank of the United States had existed, it would have had
ample notice of the accumulation of public moneys in the local banks, and by
timely mea>^ures of precaution, it could have pievented the speculative uses
to which they were applied. Such an institution would have been bound, by
its relations to the Government, to observe its appropriations, and financial
arrangements and wants, and to hold itself always ready promptly to meet
them. It would have drawn together gradually, but certainly, the public moneys, however dispersed. Responsibility would have been concentrated upon
it alone, instead of being weakened or lost by diffusion among some eighty or
local banks, dispersed throughout the country, and acting without any ettec-


tive concert.

A subordinate but not unimportant cause of the evils which at present encompass us has been the course of the late a<lministration towards the compromise act. The great principle of that act, in respect to oui- domestic industry, was its stabilit}'.
It was intended and hoped that, by withdrawing
the tariff from th(»se annual discussions in Congress, of which it had been the
fruitful topic, our manufactures would have a certainty, for a long period, as
to the measure of protection, extended to them by its piovisions, which would
compensate any reduction in (he amount contained in prior acts. For a year
or two after it was adopted, the late administration n)anifested a disposition to
respect it, as an arrangement which was to be inviolable. But, for some time
past, it has been constantly threatened from that quarter, and a settled purpose has been displayed to disregard its conditions. Those who had an agency
in bringing it forward, and carrying it through Congress, have been held up to
animadversion; it has been declared by members high in the confidence of
the administration in both Houses, to possess no obligatory force beyond any
ordinary act of legislation, and new adjustments of the tariff have been proprtscd in both Houses, in direct contravention of the principles of the compromise ; and, at the last session, one of them actually passed the Senate,
portion of the
against the most earnest entreaty and remonstrance.
.South has not united in these attacks uF)on the compromise ; and I take pleasure in saying that the two Senators from South Carolina, especially, have


Jiniformly exhibited a resolution to adhere to it with perfect honor and fidelity.
eftect of these constant threats and attacks, coming from those high in
power, has been most injurious. They have shown to the manufacturing interest that no certain reliance was to be placed upon the steadiness of the
policy of the Government, no matter under what solemn circumstances it was
adopted. That interest has taken alarm ; new enterprises have been arrested,
old ones curtailed ; and at this moment it is the most prostrate of all the interests in the country.
One-half in amount, as I have been informed, of the
manufacturers throughout the country have actually suspended operations, and
those who have not chiefly confine themselves to working up their stocks on



The consequence has been, that we have made too little at home, and purhased too much abroad. This has augmented that foreign debt, the existence of which so powerfully contributed to the suspension, and yet forms
an obstacle to the resumption of specie payments.
The Senator from South Carolina (Mr. Calhoun) attributed the creation
of the surplus revenue to the taritF policy, and especially to the acts of 18-24
and 1828. I do not perceive any advantage, on the present occasion, in reviving or alluding to the former dissensions which prevailed on the subject of
that policy.
They were ail settled and quieted by the great healing measure
(the compromise) to which I have referred. By that act I have been willing
and ready to abide. And 1 have desired only that it should be observed and
executed in a spirit of good faith and fidelity similar to that by which I have
been ever actuated towards it.
The act of 1828 was no measure of the friends of the manufacturers. Its
passage was forced by a coalition between their secret and open opponents.
But the system of protection of American industry did not cause the surplus. It proceeded from the extraordinary sales of the public lands. The
receipts, from all sources other than that of the public lands, and expenditures of the years 1833-4-5-(), (during vyhich the surplus was accumulating,)
both amount to about eighty-seven millions of dollars ; thus clearly showing
that the customs only supplied the necessary means of public disbursement,
and that it was the public domain that produced the surplus.
If the land bill had been allowed tn go into operation, it would have distributed gradually and regularly among the several States the proceeds of
the public lands, as they would have been received from time to time. They
would have returned back in small streams, similar to those by which ihey
had been collected, animating, and improving, and fructifying the whole
There would have been ao vast surplus to embarrass the Government ; no removal of deposites from the Bank of the United States to
the deposite banks, to disturb the business of the country j no accumulations
in the deposite banks of immense sums of public money, augmented by the
circuit it was performing between the land offices and the banks, and the
banks and the land offices ; no occasion for the Secretary of the Treasury to
lash the deposite banks into the grant of inordinate accommodations; and
possibly there would have been no suspension of specie payments.
But that
bill was suppressed by a most extraordinary and dangerous exercise of Executive power.
The cause of our present difficulties may be stated in another way. During the late Administration we have been deprived of the practical benefit
of a free Government; the forms, it is true, remained and were observed,
but the essence did not exist. In a free, or self-government, the collected
wisdom, the aggregate will of the whole, or at least of a majority, moulds
and directs the course of public affairs. In a despotism, the will of a single
individual governs. In a practically freq Government, the nation controls
the Chief Magistrate; in an arbitrary Government, the Chief Magistrate controls the nation.
And has not this been our situation in the period mentioned ? Has not one man forced his own will on the nation ? Have not all
those disastrous measures the veto of the bank ; the removal of the deposites; the rejection of the land bill ; and the Treasury order, which have led
to our present unfortunate condition, been adopted, in spite of the wishes of


the country,


in opposition, probably, to

those of the dominant party


the want of wisdom, but of firmness. The party
power would not have governed the country very ill, if it had been allowed
Its fatal error has been to lend its sanction, and to bestow its
its own way.
subsequent applause and support upon Executive acts which, in their origin,
We have been shocked and grieved
it previously deprecated or condemned.
to see whole legislative bodies and communities approving and lauding the rejection of the very measures which previously they had unanimously recommended! To see whole States abandoning their long-cherished policy and

Our misfortune has not been


And the numberless
best interests in subserviency to Executive pleasure
examples of individuals who have surrendered their independence, must inA single case forces itself upon my recolflict pain in every patriot bosom,
lection as an illustration, to which I do not advert from any unkind feelings
towards the gentleman to whom I refer, between whom and myself civil and
courteous relations have ever existed. The memorial of the late Bank of the
United States praying for a recharter was placed in his hands, and he presented it to the Senate. He carried the recharter through the,Senate. The
veto came ; and, in two or three weeks afterwards, we behold the same Senator at the head of an assembly of the People in the State-house yard, in
Philadelphia, applauding the veto, and condemning the bank condemning
Motives lie beyond the reach of the human eye, and it does
his own act
not belong to me to say what they were which prompted this self-castigation,
and this praise of the destruction of his own work; but it is imposible to
overlook the fact that this same Senator, in due time, received from the auI



thor of the veto the gift of a splendid foreign mission
The moral deducible from the past is, that our free institutions are superior
to all others, and can be preserved in their purity and excellence only upon
the stern condition that we shall forever hold the obligations of patriotism
paramount to all the ties of party, or to individual dictation : and that we
shall never openly approve what we secretly condemn.
In this rapid, and, I hope, not fatiguing review of the causes which I think
have brought upon us existing embarrassments, I repeat that it has been for
no purpose of reproaching or criminating those who have had the conduct of our
public affairs ; but to discover the tneans by which the present crisis has been
produced, with a view to ascertain, if possible, what (which is by far much
more important) should be done by Congress to avert its injurious efiects.
And this brings me to consider the remedy proposed by the Administration.
The great evil under which the country labors is the suspension of the banks
to pay specie, the total derangement in all domestic exchanges, and the paralysis which has come over the whole business of the country. In regard to the
currency, it is not that a given amount of bank notes will not now command
as much as the same amount of specie would have done prior to'the suspension ;
but it is the future, the danger of an inconvertible paper money being indefinitely or permanently fixed upon the People, that fills them with apprehensions.
Our great object should be to re-ostablish a sound currency, and
thereby to restore the exchanges and revive the business of the country.
The first impression which the measures brought forward by the Administration make is, that they consist of temporary expedients, looking to the
supply of the necessities of the Treasury ; or, so far as any of them possess a
permanent character, its tendency is rather to aggravate than alleviate the
sufferings of the People.
None of them proposes to rectify the disorders in
ihe actual currency of the country; but the People, the States, and their
f)anks, are left to shift for themselves as they may or can.
The Administration, after having intervened between the States and their banks, and taken
fhcm into the Federal service, without the consent of the States ; after having
puffed and praised them ; after having brought them, or contributed to bring
them, into their present situation, now suddenly turns its back upon them,
leaving them to their f^ite
It is not content with that; it must absolutely
discredit their issues.
And the very People who were told by the Administration tliat these banks would supply them with a better currency, are now


kft to struggle as they can with the very currency which the Government
s-ecommendecl to them, but which it now refuses itself to receive
The professed object of the Administration is to establish what it terms the
currency of the Constitution, which it proposes to accomplish by restricting
the Federal Government, in all receipts and payments, to the exclusive use of
It disspecie, and by refusing all bank paper, whether convertible or not.
claims all purposes of crippling or putting down the banks of the States ; but
we shall better determine the design or the effect of the measures recommendefl by considering them together, as one system.
1. The first is the sub-Treasuries, which are to be made the depositories
of all the specie collected and paid out for the service of the General Government, discrediting and refusing all the notes of the States, although payable and paid in specie.
2. A bankrupt law for the United States, levelled at all the State banks, and
authorizing the seizure of the effects of any of them that stop payment, and
the administration of their effects under the Federal authority exclusively.
particular law for the District of Columbia, by which all the corporations and people of the District,undersevere pains and penalties, are prohibited from circulating, sixty days after the passage of the lavv^, any paper whatever
not convertible into specie on demand, and are made liable to prosecution
by indictment.
4. And, lastly, the bill to suspend the payment of the fourth instalment to
the States, by the provisions of which the deposite banks indebted to the Government are placed at the discretion of the Secretary of the Treasury.
It is impossible to consider this system without perceiving that it is aimed
at, and, if carried out, must terminate in, the total subversion of the State
banks j and that they will be all placed at the mercy of the Federal Government. It is in vain to protest that there exists no design against them. The
effect of these measures cannot be misunderstood.
And why this new experiment or untried expedient? The People of this
country are tired of experiments. Ought not the Administration itself to cease
with them ? Ought it not to take warning from the events of recent elections ?
Above all, should not the Senate, constituted as it now is, be the last body to
lend itself to further experiments upon the business and happiness of this great
People? According to the latest expression of public opinion in the several^
States, the Senate is no longer a true exponent of the will of the States or ot
the People.
If it were, there would be thirty-two or thirty-four Whigs to
eighteen or twenty friends of the Administration.
Is it desirable to banish a convertible paper medium, and to substitute the
precious metals as the sole currency to be used in all the vast extent of varied
business of this entire country ? I think not. The quantity of precious metals
in the world, looking to our fair distributive share of them, is wholly insufficient. A convertible paper is a great time-saving and labor-saving instrument,
independent of its superior advantages in transfers and remittances. A friend,
no longer ago than yesterday, informed me of a single bank whose payments
and receipts in one day amounted to two millions of dollars. What time would
not have been necessary to count such avast sum ? The payments, in the circle of a year, in the city of New York, were estimated several years ago at
How many men and how many days would be nefifteen hundred millions.
young, growing, and enterprising People,
cessary to count such a sum ?
those of the United States, more than any other, need the use of those
credits which are incident to a sound paper system. Credit is the friend of
indigent merit. Of all nations. Great Britain has most freely used the credit
must cease to be a comsystem ; and of all she is the most prosperous.
mercial people; we must separate, divorce ourselves from the commercial
world, and throw ourselves back for centuries, if we restrict our business to
the exclusive use of specie.
It is objected against a convertible paper system, that it is liable to expansions and contractions ; and that the consequence is the rise and fall of prices,
and sudden fortunes or sudden ruin. But it is the importation or exportation
of specie which forms the basis of paper, that occasions these fluctuations.





If specie alone were the medium of circulation, the same importation or exportation of it would make it plenty or scarce, and affect prices in the same
manner. The nominal or apparent prices might vary in figures, but the sensation upon the community would be as great in the one case as in the other.
These alternations do not result, therefore, from the nature of the medium,
whether that be specie exclusively, or paper convertible into specie, but from
the operations of commerce. It is commerce, at last., that is chargeable with
expansions and contractions ; and against commerce, and not its instrument,
should opposition be directed.
I have heard it urged by the Senator from South Carolina (Mr. Calhoun)
with no little surprise, in the course of this debate, that a convertible paper
would not answer for a currency, but that the true standard of value was to
be found in a paper medium not convertible into the precious metals. If
there be, in regard to currency, one truth which the united experience of the
\vhole commercial world had established, I had supposed it to be that emissions of pure paper money constituted the very worst of all conceivable
species of currency. The objections to it are : First, that it is impracticable
to ascertain, a priori, what amount can be issued without depreciation ; and,
secondly, that there is no adequate security, and, in the nature of things, none
can exist, against excessive issues. The paper money of North Carolina, to
which the Senator referred, according to the information which 1 have received, did depreciate. It was called Proc, an abbreviation of the authority
under which it was put forth, and it took one and a half and sometimes two
dollars of proc. to purchase one in specie.
But if any one desires to understand perfectly the operation of a purely paper currency, let him study the
history of the Bank of the Commonwealth of Kentucky.
It was established
about 15 or 16 years ago, with the consent of a majority ot the people of that
State. It is winding up and closing its career, with the almost unanimous
approbation of the whole people. It had an authority to issue, and did issue,
notes to the amount of about two millions of dollars. These notes, upon their
face, purported an obligation of the bank to pay the holder, on demand, the
amount in specie; but it was well known that they would not be so paid. As
a security for their ultimate payment, there were, 1st, the notes of individuals
supposed tobe well secured, every note put out by the bank being represented
by an individual note discounted. 2(1. The funds of the State in a prior State
bank, amounting to about half a million of dollars. 3d. The proceeds of a
large body of waste lands belonging to the State.
And 4th. The annual
revenue of the State and public dues, all of which were payable in the notes
of the Commonwealth Bank.
Notwithstanding this apparently solid provision for the redemption of the
notes of the bank, they began to depreciate shortly after it commenced operation, and in the course of a few months they sunk as low as fifty per cent.
two dollars for one specie dollar. They continued depreciated for along'
time, until after large amounts of them were called in and burnt. They then
rose in value, and now, when there is only some fifty or one hundred thousand
dollars out, they have risen to about par.
This is owing to the demand lor
them, created by the wants of the remaining debtors to the bank, and their
The result of the experiment is, that, alreceivability in payment of taxes.
though it is possible to sustain at about par a purely paper medium to some
amount, if the legislative authority which creates it will also create a demand
for it, it is impracticable to adjust the proportions of supply and demand so as
to keep it at par ; and that the tendency is always to an excess of issue. The
result, with the people of Kentucky, has been a general conviction of the
mischiefs of all issues of an irredeemable paper medium.
Is it practicable for the Federal Government to put down the State banks,
and to introduce an exclusive metallic currency : In the operations of this
Government, we should evei* bear in mind that political power is distributed
between it and the States, and that, whilst our duties are itivf and clearly deTheir
fined, the great mass of legislative authority abides with the Stateshave no
banks exist without us, independent of us, and in spite of us.
Why, then, seek their deconstitutional power or right to put them down.


openly or secretly, directly or indirectly, by discrediting their isWhat are
sues, and by bankrupt laws, and bills of pains and penalties?
these banks now so decried and denounced ? Intruders, aliens, enemies that
have found their way into the bosom of our country against our will? Reduced to their elements, and the analysis shows that they consist : 1st, of
stockholders; 2d, debtors; and 3d, bill-holders and other creditors. la
some oneoflhese three relations, a large majority of the People of the United
In making war upon the banks, therefore, you wage war upon
States stand.
the People of the United States. It is not a mere abstraction that you v/ould
kick and cuft', bankrupt and destroy, but a sensitive, generous, confiding people, who are anxiously turning their eyes towards you, and imploring relief.
Every blow that you inflict upon the banks reaches tliem. Press the banks,
and you press them.
TriR; wisdom, it seems to me, requires that we should not seek after, if we
could discover, unattainable abstract perfection; but should look to what is
practicable in human affairs, and accommodate our legislation to the irreverSince the States and the People have their banks,
sible condition of things.
and will have them, and since we have no constitutional authority to put thein

is to come to their relief when in embarrassment, and to
our legitimate powers to sustain and enable them to perform, in the
should embank,
most beneficial manner, the purposes of their institution.
not destroy, the fertilizing stream which sometimes threatens an inundation.
are told that it is necessary to separate, divorce the Government from
the banks. Let us not be deluded by sounds.
Senators might as well talk of
separating the Government from the States, or from the People, or from the
are all. People, States, Union, banks, bound up and intercountry.

down, our duty






together, united in foi-tune and destiny, and all, all entitled to the protecting caie of a parental Government.
You may as well attempt to make
the Government^ breathe a difierent air, drink a difterent water, be lit and
warmed by a different sun from the People!
hard-money Government
and a paper-money People!
Government, an official corps the servants
of the People glittering in gold, and the People themselves, their masters,
buried in ruin, and surrounded with rags.
No prudent or practical Government will in its measures run counter to
the long-settled habits and usages of the People. Religion, language, laws,
the established currency and business of a whole country, cannot be easily or
suddenly uprooted. After the denomination of our coin was changed to dollars and cents, many years elapsed before the old method of keeping accounts,
in pounds, shillings, and pence, was abandoned.
And, to this day, there are
probably some men of the last century who adhere to it. If a fundamental
change becomes necessary, it should not be sudden, but conducted by slow
and cautious degrees. The People of the United States have been always a
paper money People. It was paper money that carried us through the Revolution, established our liberties, and made us a free and independent People.
And, if the experience of the revolutionary war convinced our ancestors, as
we are convinced, of the evils of an irredeemable paper medium, it was put
aside only to give place to that converiible paper which has so powerfully
contributed to our rapid advancement, prosperity, and greatness.
The proposed substitution of an exclusive metallic currency, to the mixed
medium with which we have been so long familiar, is forbidden by the princiAssuming the currency of the country to consist of
ples of eternal justice.
two-thirds of paper and one of specie ; and assuming also that the money of
a country, whatever may be its component parts, regulates all values, and
expresses the true amount which the debtor has to pay to his creditor, the
eftect of the change upon that relation, and upon the property of the country,
would be most ruinous. All property would be reduced in value to one-third
of its present nominal amount ; and every debtor would, in effect, have to
pay three times as much as he had contracted for. The pressure of our foreign debt woiild be three tunes as great as it is, whilst the six hundred millions, which is about the sum now probablydue to the banks from the People,
would be multiplied into eighteen hundred millions.





are some more specific objections to this project of sub-Treasuwhich deserve to be noticed. The first is its insecurity. The subTreasurer and his bondsmen constitute the only guaranty for the safety of the
immense sums of public money which pass through his hands. Is this to be
compared with that which is possessed through the agency of banks? The
collector, who is to be the sub-Treasurer, pays the money to the bank, and the
bank tothe disbursing officer. Here are three checks ; you propose to destroy
two of them, and that most important of all, the bank, with its machinery of
president, directors, and cashier, teller and clerks, all of whom are so many
At the very moment when the Secretary of the Treasury tells us
how well his sub-Treasury system works, he has communicated to Congress a
circular signed by himself, exhibiting his distrust in it; for he directs in that circular that the public moneys, when they amount to a large sum, shall be specially deposited with those very banks which he would repudiate. In tl# State
of Kentucky, (other gentlemen can speak of their respective States.) although
it has existed but about forty-five years, three Treasurers, selected by the
Legislature for their established charactersof honor and probity, proved faithless.
And the history of the delinquency of one is the history of all. It commenced in human weakness, yielding to earnest solicitations for temporary
loans, with the most positive assurances of a punctual return. In no instance
was there originally any intention to defraud the Public.
should not
expose poor weak human nature to such temptations. How easy will it be, as
has been done, to indemnify the sureties out of the public money, and squander the residue

But there





there is the liability to favoritism. In the receipts, a political partisan or friend may be accommodated in the payment of duties, in the disbursement, in the purchase of bills, in drafts upon convenient and favorable
offices, and in a thousand ways.
3. The fearful increase of Executive patronage.
Hundreds and thousands
of new offices are to be created ; for this bill is a mere commencement of the
system, and all are to be placed under the direct control of the President.
The Senator from South Carolina (Mr. Calhoun) thinks that the Executive is now weak, and that no danger is to be apprehended from its patronage.
I wish to God 'I could see the subject in the same light that he does.
I wish
that I could feel free from that alarm at Executive encroachments by which
he and I were so recently animated. When and how, let me ask, has that
power, lately so fearful and formidable, suddenly become so weak and harmless.^
Whereis that corps of one hundred thousand office-holders and dependants, whose organized strength, directed by the will of a single man, was
lately held up in such vivid colors and powerful language by a report made by
the Senator himself.
When were they disbanded ? What has become of
proscription } Its victims may be exhausted, but the spirit and the power
which sacrificed them remain unsubdued. What of the dismissing power ?
What of the veto
Of that practice of withholding bills, contrary (o the Constitution, still more reprehensible than the abuses of the veto ?
Of Treasury
orders, put in force and maintained in defiance and contempt of the legislative authority ?
And, although last, not least, of that expunging power which
degraded the Senate, and placed it at the feet of the Executive r
Which of all these enormous powers and pretensions has the present Chief
Magistrate disavowed ? So far Irom disclaiming any one of them, has he not
announced his intention to follow in the very footsteps of his predecessor ?
And has he not done it ? Was it against the person of Andrew Jackson that
No, sir, no,
the Senator from South Carolina so ably co-operated with us
sir, no.
It was against his usurpations, as we believed them, against his arbitrary administration, above all, against that tremendous and frightful augmentation of the power of the Executive branch of the Government, that we patriotically but vainly contended.
The person of the Chief Magistrate is
changed, but there stands the Pjxecutive power, perpetuated in all its vast
magnitude, undiminished, rc-asserted,and overshadowing all the other departments of the Government. Every trophy which the late President won from
them now decorates the Executive mansion. Every power, which he tore






a bleeding Constitution,



in the

Executive armory, ready, as time

and occasion may prompt the existing incumbent, whoever he may

be, to be

thundered against the liberties of the People.
Whatever may have been the motives or the course of others, I owe it to
myself and to triitli to say, that in deprecating the election of General Andrew
Jackson to the office of Chief Magistrate, it was not from any private considerations, but because I considered it would be a great calamity to my country ; and that, in whatever opposition I made to tbe measures of his Administration, which more than realized my very worst apprehensions, I was guided
solely by a sense of public duty.
And I do now declare my solemn and un
shaken conviction that until the Executive power, as enlarged, extended, and
consolidated by him, is reduced within its true constitutional limits, there is
no permanent security for the liberties and happiness of this People.
4. Lastly, pass this bill, and whatever divorce its friends may profess to
be its aim, tiiat perilous union of the purse and the sword, so justly dreadeil
by our British and revolutionary ancestors, becomes absolute and complete.
And vyho can doubt it who knows that over the Secretary of the Treasury at
Washington, and every sub-Treasurer, the President claims the power to
exercise uncontrolled sway ? to exact implicit obedience to his will ?
The message states that in the process both of collection and disbursement
of the public revenue, the officers who perform it act under the Executive
commands; and it argues that, therefore, the custody also of the Treasury
might as well be confided to the Executive care. I think the safer concluThe possession of so much power over the national
sion is directly opposite.
treasure is just cause of regret, and furnishes a strong reason for diminishing
it, if possible, but none for its increase, none for giving the whole power over
the purse to the Chief Magistrate.
Hitherto 1 have considered this scheme of sub-Treasuries as if it was only
what its friends represent it a system solely for the purpose of collecting,
keeping, and disbursing the public money, in specie exclusively, without any
bank agency whatever. But it is manifest that it is destined to become, if it
be not designed to be, a vast and ramified connexion of Government banks, of
which the principal will be at Washington, and every sub-Treasurer will be
The ."Secretary is authorized to draw on the several sub-Treasurers
a branch.
in payment for all the disbursements of Government.
No law restricts him
He may throw them into
as to the amount or form of his drafts or checks.
amounts suited to the purposes of circulation, and give them all the appearance and facilities of bank notes. Of all the branches of this system, that at
ISew York will be the most important, since about one-half of the duties is
Drafts on New York are at par, or command a premium
collected there.
from every point of the Union. It is the great money centre ot the country.
Issued in convenient sums, they will circulate throughout the whole Union
as bank notes, and, as long as confidence is reposed in them, will be preferred
to the specie which their holders have a right to demand.
They will supply
a general currency, fill many of the channels of circulation, be a substitute for
notes of the Bank of the United States, and supplant, to a great extent, the
use of bank notes. The necessities of the People will constrain them to use
them. In this way, they will remain a long time in circulation ; and in a few
years we shall see an immense portion of the whole specie of the country concentrated in the hands of the branch bank— that is, the sub-Treasurer, at New
York, and represented by an equal amount of Government paper dispersed
throughout the country. The responsibility of the sub-Treasurer will be consequently greatly increased, and the Government will remain bound to
guaranty the redemption of all the drafts, checks, or notes (whatever may be
their denomination) emitted upon the faith of the money in his custody, and,
of course, will be subject to the hazard of the loss of the amount of specie in
the hands of the sub-Treasurer. If, in the commencement of this system, the
holders of this Government paper shall be required to present it for payment
in coin, within a specified time, it will be found inconvenient or impracticable to enforce the restriction, and it will be ultimately abandoned.
Is the Senate prepared to consent to place not only all the specie that may




collected for the revenue of the country, at the will of the President, or,
Avhich is the same thing, in the custody of persons actin-r in obedience to his
will, but to put him at the head of the most powerful and influential system of
Government banks that ever existed ?
It is said, in the message, that Government is not bound to supply the country with the exchanges which are necessary to the transaction of its business.
But was that the language held during the progress of the contest with the
Was not the expectation held out to the
late Bank of the United States ?
People that they would be supplied with a better currency, and with better
regulated exchange ? And did not both the late President and the Secretary
of the Treasury dwell, with particular satisfaction, in several messages and
reports, upon the improvement of the currency, the greater amount in exchange, and the reduction of the rates, under the operation of the Slate bank
system, than existed under the Bunk of the United States? Instead of fulfilling the promises then held out, the Government now wraps itself up in its
dignity tells the People that they expect too much of it ; that it is not its
business to furnish exchanges and that they may look to Europe tor the manner in which, through the agency of piivate bankers, the commerce and busij)e




are advised to give up
its countries are supplied with exchange.
our American mode of transacting business, through the instrumentality of
banking corporations, in which the interests of the rich and the poor are happily blended, and to establish bankers similar to the Hopes, the Barings, the
Rothschilds, the Hotinguers, of Europe ; houses which require years or ages to
form and to put in successful operation, and whose vast overgrown cajjitals,
possessed by the rich exclusively of the poor, control the destiny of nations
and determine the fate of empires!
Having, I think, Mr. President, shown that the project of the Administration is neither desirable nor practicable, nor within the constitutional power of
the General Government, nor just ; and that it is contrary to the habits of the
People of the United States, and is dangerous to their liberties, 1 inight here
close my remarks ; but I conceive it to be the dutj'^ of a patriotic opposition
jiot to confine itself merely to urging objections against measures to promote
the general prosperity, brought forward by those in power. It has fuither
and higher duties to perform. There may be circumstances in which the Opposition is bound formally to present such measures as, in its judgment, are
demanded by the exigency of the times ; but if it has just reason to believe
that they would be unacceptable to those who a/oue can adopt them, and give
them etlect, the Opposition will discharge its duty by suggesting what it believes ought to be done for the public good.
I know, sir, that I have friends whose partiality has induced them to hope
that I would be able to bring forward some healing measure tor the disordeis
which unhappily prevail, that might prove acceptable. I wish to God that I
could realize this hope; but I cannot. The disease is of such an alarming
character as to require more skill than I possess ; and I regret t(5 be compelled
to fear that tiiere is no eft'ectual remedy but that which is in the hands of the

ness of

suffering patient himself.
Still, under a deep sense of the obligation to which I have referred, I declare that, after the most deliberate and afixious consideration of which I am

capable, I can conceive of no adequate

remedy which does not comprehend a

It appears to me that a National Bank,
as an essential part.
•with such modifications as experience has pointed out, and particularly such
as would limit its profits, exclude fbieign influence in the government of it,
and give publicity to its transactions, is tl)e only safe and certain remedy that
can be adopted. The great want of the country is a general and uniform currency, and a point of union, a sentinel, a regulator of the issues of the local



banks; and that would be supplied by such an

to discuss, as an original question, the constitutional
1 am
power of^ Congress to establish a National Bank. In human affairs, there are
some questions, and I think this is one, that ought to be held as terminated.

not going


several decisions of Congress aflirming the power, the concurrence of
every other Department of the Government, the approbation of the People^


the concurrence of both the great parties into which the country has been divided, and forty years of prosperous experience with such a bank, appear to
me to settle the controversy, if any controversy is ever to be settled. Twentytwo years ago, Mr. Madison, whose opposition to the first Bank of the United
Stales is well known, in a message to Congress, said :
Waiving the question of the constitutional authority of the Legislature to
* establish an incorporated bank, as being precluded, in my judgment,
by re* peated recognitions, under varied circumstances, of the validity of such
' institution, in acts of
the legislative, executive, and judicial branches of the
* Government,
accompanied by indications, in different modes, of a corre'
spondenceof the general will of the nation ; the proposed bank does not ap' pear to be
calculated to answer the purposes of reviving the public credit, of
' providing
a national medium of circulation, and of aiding the Treasury by
* facilitating the indispensable
anticipations of revenue, and by affording to
* the public more durable loans."
To all the considerations upon which he then relied, in treating it as a settled question, are now to be added two distinct and distant subsequent expressions of the deliberate opinion of a republican Congress, two solemn decisions of the Supreme Court of the United States, twenty years of successful
experience, and disastrous consequences quickly following the discontinuance
of the bank.
I have been present, as a member of Congress, on the occasion of the termination of the charters of both the Banks of the United States ; took part in
the discussion to which they gave rise, and had an opportunity of extensively
knowing the opinions of members ; and I declare my deliberate conviction
that, upon neither was there one-third of the members in either House who
entertained the opinion that Congress did not possess the constitutional power
to charter a bank.
But it is contended that, however indispensable a Bank of the United
States may be to the restoration of the prosperity of the country, the President's opinion against it opposes an insuperable obstacle to the establishment
of such an institution.
It will, indeed, be unfortunate, if the only measure
which can bring relief to the People should be prevented by the Magistrate
whose elevated station should render him the most anxious man in the nation
to redress existing grievances.
The opinion of the President which is relied upon is that contained in his celebrated letter to the Hon. S. VVilliams, and that which is expressed in the message before us. I must say, with all proper deference, that no man, prior to or
after his election to the Chief Magistracy, has a right to say, in advance, that
lie would not approve of a particular bill, if it were passed by Congress.
annunciation of such a purpose is premature, and contrary to the spirit, if not
the express provision of the constitution. According to that instrument, the
participation of the President in the legislative power— his right to pass upon
a bill is subsequent, and not previous to the deliberations of Congress. The
constitutional provision is that, when a bill shall have passed both Houses, it
shall be presented to the President for his approval or rejection.
His right to
pass upon it results from the presentation of the bill, and is not acquired until
What would be thought of the judge who, before a cause is
it is presented.
brought before the court, should announce his intention to decide in favor of a
named party.^* Or of the Senate, which shares the appointing power, if it should,
before a nomination of a particular individual is made for an office, pass a resolution that it would not approve the nomination of that individual ?
It is clear that the President places his repugnance to a Bank of the United
States mainly upon the ground that the popular will has been twice " solemnly
and unequivocally expressed" against it. In this I think the President is
mistaken. The two occasions to which he is understood to refer, are the
election of General Andrew Jackson in 1832, and in his own election in 1836.
Now, as to the first, there was not, before it took place, any unequivocal expression of the opinion of the late President against a national bank. There
was, in fact, a contrary expression. In the veto message, President Jackson
admitted the public convenience of a bank ; stated that he did not find in the


renewed charter such modifications as could secure

his approbation, and added
he had been applied to, he could have furnished thejuodel of a bank
that would answer the purposes of such an institution. In supporting his reelection, therefore, the People did not intend, by the exercise of their suttVage,
to deprive themselves of a national bank.
On the contrary, it is within my
own knowledge, that many voted for him who believed in the necessity of a
bank quite as much as 1 do. And I am perfectly persuaded that thousands
and tens of thousands sustained his re-election under the full expectation that
a national bank would be establi>hed during his second term.
Nor, sir, can I think that the election of the present Chief Magistrate ought be
taken as evidence that the People are against a bank. The most that fairly can
be asserted is, that he was elected, the expression of his opinion in the letter
to Mr. Williams notwithstanding.
The question of the election of a Chief
Magistrate is a complex question, and one of compensations and comparison.
All his opinions, all his qualifications are taken into consideration, and cornpared with those of his competitors. And nothing more is decided by the
People than that the person elected is preferred amongst the several candiThey take him as a man takes his wife, for better for worse, with all
the good .'ind bad opifiions and qviali'.es which he possesses.
You might as
well argue that the election of a particular person to the office of Chief Maghstiate linplies that his figure, form, and appearance exhibit the standard of
human perfection, as to contend that it sanctions and approves every opinion
which he may have publicly expressed on public affairs. It is somewhat ungrateful to the Pecjple to suppose that the particular opinion of Mr. Van Buren, in regard to a Bank of the United States, constituted any, much less the
It would be more honorable
chief recommendation of him to their suffrages.



to him and to them to suppose that it proceeded from his eminent abilities,
and his distinguished services at home and abroad. If we are to look beyond
them and beyond him, many believe that the most influential cause of his
election was the endorsement of that illustrious predecessor in whose foot-

steps he stands pledged to follow.

No, sir, no ; the simple and naked question of a bank or no bank of the
United States was not submitted to the People iand "twice solemnly
and unequivocally''^ decided against by them. I firmly believe that if such a
question were now submitted to them, the response of a vast majority would
be in the aflirmative. I hope, however, that no bank will be established or
proposed, unless there shall be a clear and undisputed majority of the People
and of the States in favor of such an institution. If there be one wanted,
and an unequivocal manifestation be made of the popular will that it is desiredja bank will be established. The President's opposition to it is founded
principally upon the presumed opposition of the People. Let them demonHe
strate that he is mistaken, and he will not separate himself from them.
is too good a democrat, and the tenor of his whole life shows that, whatever
other divorces he may recommend, the last that he would desire would be one
between him and the People. Should this not prove to be the case, ami if a
majority should not exist sufficiently large to pass a bank charter in spite ot"
the veto, the ultimate remedy will remain to the People to change their rulers, if their rulers will n.jt change their opinions.
But, during this debate* it has been contended that the establishment of a
new Bank of the United States would aggravate existing distresses; and
that the specie necessary to put it in operation could not be obtained without
prejudice to the local banks.

What is the relief for which all

hearts are

now so anxiously

again in motion, to restore exchanges,


} It is


and revive the drooping

put the banks
business of the country. And what are the obstacles ^ They are, first, the
If the banks were to reforeign debt; and, secondly, a want of confidence.
their vaults, it is apprehended that the specie would immediately
be exported to Europe to discharge the foreign debt. Now, if a Bank of the
United States were established, with a suitable capital, the stock of that bank
itself would form one of the best subjects of remittance ; and an amount of it



tqual to what remains ot" the foreign debt would probably be remitted, retaining at home or drawing from abroad the equivalent in specie.
great, if not the greatest existing evil, is the want of confidence, not
merely in the Government, but in distant banks, and between the banks themselves.
There is no tie or connexion binding them together, and they are
often suspicious of each other. To this want of confidence among the banks
themselves, is to be ascribed that extraordinary derangement in the exchanges
of the country.
How otherwise can we account for the fact that the paper
of the banks of Mississippi cannot now be exchanged against the paper of the
banks of Louisiana, without a discount in the former of 10 or 15 per cent.;
nor that of the banks of Nashville, without a discount of 8 or 10 per cent,
against the paper of the banks of the adjoining State of Kentucky? It is
manifest that, whatever may be the medium of circulation, whether it be inconvertible paper or convertible paper and specie, suppo\^ing confidence to exist, the rates of exchanges in both cases ought to be nearly the same.
But, in
times like these, no bank will allow its funds to accumulate, by the operations
uf exchange, at points where no present use can be made of them.
Now, if a Bank of the United States were established, with a proper capital, and it were made the sole depository of the public moneys, and its notes
were receivable in all Government dues, it might commence operations forthwith, with a small amount of specie, perhaps not more than two millions. That
sum would probably be drawn from the community, where it is now hoarded
and dormant ; or if it were taken even from the local banks, they would be
more than compensated in the security which they would enjoy, by the remittance of the stock of the new bank to Europe, as a substitute for their
Such a new bank, once commencing business, would form a i-allying point
confidence would revive, exchanges be again regulated, and the business and
prosperity of the country be speedily restored. And it is by no means certain
that there would be any augmentation of the banking capital of the country,
for it is highly probiable that the aggregate amount of unsound banks, which
can never resume specie payments, would be quite equal to that of the new



An auxiliary resolution miglit be adopted with salutary effect, similar to that
which was adopted in 1816, offering to the State banks, as a motive to resume
specie payments, that their paper should be received for the public dues ; or,
as their number has since that period greatly increased, to make the motive
more operative, the offer might be confined to one or two banks in each State,
known to be trustworthy. Let them and a Bank of the United States commence specie payments, and all the other sound banks would be constrained,
by the united force of public opinion and the law, to follow the example.
If, in contrasting the two periods of 1817 and 1837, some advantages for
the resumption of specie payments existed at the former epoch, others which
At the first there were none
distinguish the present greatly preponderate.
except the existence of a public debt, and a smaller number of banks. But
then an exhausting war had wasted our means. Now we have infinitely
greater wealtli, our resources are vastly more developed and increased, our
population nearly doubled, our knowledge of the disease much better, and,
what is of the utmost importance, a remedy, if applied now, would be administered in a


earlier stage of the disorder,

A general

currency of sound and uniform value is necessary to the wellbeing of all parts of the Confederacy, but it is indispensable to the interior
The seaboard States have each of them banks, whose paper freely
circulates within their respective limits, and serves all the purposes of their
business and commerce at their capitals, and throughout their whole extent.
The variations in the value of this paper, in passing through those States, trom
one commercial njetropolis to another, are not ordinarily very great. But how
are we of the interior to come to the Atlantic cities to purchase our supplies of
foreign and domestic comnmdities, without a genetal medium ? The paper of
want a
our own banks will not be received but at a ruinous discount.
general currency, which will serve at home, and enable us to carry on our



accustomed trade with our brethren of the Atlantic States. And such a currency we have a right to expect.
I do not arrogate to myself a right to speak tor and in behalf of all the
Western States; but, as a Senator from one of them, I am entitled to be
heard. This Union was formed to secure certain general, but highly important objects, of which the common defence, commerce, and a uniform currency were the leading ones. To the interior States, none is of more importance than that of currency. Nowhere is the attachment to the Union more
ardent than in those States; but, if this Government should neglect to perform its duty, the value of the Union will become impaired, and its very existence, in process of time, may become endangered.
I do believe that between a sound general currency, and the preservation of the Union itself, in
full vigor and perfect safety, there is the most intimate connexion.
If, Mr. President, (he remedies which I have suggested were successful at
a former period of our history, there is every reason to hope that they would
again prove efficacious ; but let me suppose that they should not, and that
some unknown cause, which could not then, should now, thwart their operation, we should have, in any event, the consolation of knowing that we had
endeavored to profit by the lessons of experience, and, if they failed, we
should stand acquitted in the judgment of the People. They are heartily tired
of visionary schemes and wild experiments. They wish to get out of the
woods, into which they have been conducted, back to the plain, beaten, wide
road, which they had before trodden.
How, and when, without such measures as I have suggested, are the State
banks to resume specie payments ? They never can resume without concert
and concert springs from confidence ; and confidence from knowledge. But
what knowledge can eight hundred banks, scattered over our vast territory,
have of the actual condition of each other ? It is in vain that statements of it
It depends, at last, mainly upon the solvency of
be periodically published.
the debtors to the bank ; and how, whenever their names are not known, can
that be ascertained ?
Instead of coming to the aid of these prostrate institutions, and assisting
them by a mild and parental exercise of your power, in a mode sanctioned
and approved by experience, you propose to abandon them and the country to
their rate. You propose worse : to discredit their paper, to distrust them even
as special depositories, and to denounce against them all the pains and penalties of bankruptcy.
How and when will they resume specie payments ? Never, as far as my
information ej^Jends, have exertions been greater than those which the banks
have generally made to open again their vaults. It is wonderful that the community should have been able to bear, with so much composure and resignaConfidence retion, the prodigious curtailments which have been made.
established, the foreign debt extinguished, and a national institution created,
most of them could quickly resume specie payments. Some of them, urged
by a high sense of probity, and smarting under severe reproaches, will, no
doubt, make the experiment of resuming and continuing payment in specie.
They may even go on awhile; but, without the co-operation of the State
banks generally, and without the co-operation of a national bank, it is to be
apprehended that they will be again seized with a paralysis. It is my deliberate conviction that the preservation of the existence of the State banks themIt is as necessary to
selves depends upon the institution of a national bank.
them as the Union is to the welfare of the .States in our political system.
Without it, no human being can foresee when we shall emerge from the difliIt has been my fortune several times to see the
culties which surround us.
country involved in great danger ; but never before have I beheld it encompassed with any more menacing and portentous.
Entertaining the views which I have presented, it may be asked why I do
I have already adnot at once propose the establishment of a national bank.
verted to the cause. Constituted as Congress now is, I know that such a.
proposition would be defeated ; and that it would be therefore useless to make
I do not desire to force upon the Senate, or upon the country, against its

will, if I could,


opinion however sincerely and strongly entertained.

a national bank be established,




its utility will


depend upon the

is felt of its necessity.
And until such a conviction
deeply impressed upon the People, and clearly manifested by them, it
would, in my judgment, be unwise even to propose a bank.
Of the scheme of the Senator from Virginia, (Mr. Rives,) I think now as
I thought in 1834.
I do not believe that any practicable connexion of State
banks can supply a general currency, be a safe depository of the public moneys, or act efficiently as a fiscal agent of the General Government. I was
not then opposed to the State banks in their proper sphere. I thought that
they could not be relied upon to form exclusively a banking system for the
country, although they were essential parts of a general system.
The amendment of the Senator, considered as a measure to bring about the
resumption of specie payments so much desired, I think must fail. The
motive which it holds out of the receivability in all payments to the Government of the paper of such banks as may resume by a given day, coupled with
the conditions proposed, is wholly inadequate. It is an otter to eight hundred
banks ; and the revenue, payment of which in their notes is held out as the
inducement, amounts to some twenty or twenty-five millions. To entitle them
to the inconsiderable extension of their circulation, which would result from
the credit given by Government to the paper of all of them, they are required
to submit to a suppression of all notes below five dollars, and at no
very distant period to all below twenty. The enlargement of their circulation, produced by making it receivable by Government, would be much less
thanithe contraction which would arise from the suppression of the prohibited
notes. Besides, if the quality proposed again to be attached to the notes of
these local banks vi^as insufficient to prevent the suspension, how can it be efficacious enough to stimulate a resumption of specie payments

general conviction which



between the project of the
Administration and the amendment of the Senator from Virginia, vote for the
latter, because it is harmless, if it effects no good, and looks to the preservation of the State banks ; whilst the other is fraught with mischiefs, as I believe, and tends, if it be not designed, to the utter destruction of those institutions.
But, preferring to either the postponement moved by the Senator from
I shall, nevertheless, if called


I shall, in



to give a vote

instance, vote for that.

Such, Mr. President, are the views which I entertain on the present state
of our public affairs. It is with the deepest regret that I can perceive no
remedy, but such as is in the hands of the People themselves. Whenever
they shall impress upon Congress a conviction of that which they wish applied,
they will obtain it, and not before. In the mean time, let us go home, and
mix with and consult our constituents. And do not, I entreat you, let us
carry with us the burning reproach, that our measures here display a selfish

solicitude for the Government itself, but a cold
the sufferings of a bleeding People.

and heartless insensibility to





3/^DT. <P«'.