[THE independent or sub-treasury scheme being pressed upon the
consideration of congress, by Mr. Van Buren, although public
opinion was setting strongly against it, Mr. Clay delivered the
following elaborate speech, in which he shows that a deliberate
design had existed on the part of general Jackson, and his
successor, Mr. Van Buren, to break down the whole banking system
of the United States, and to create on their ruins a _government
treasury bank_, under the exclusive control of the executive.
This speech was partly in reply to Mr. Calhoun, of South
Carolina, who had become a supporter of the administration.]
I HAVE seen some public service, passed through many troubled times,
and often addressed public assemblies, in this capitol and elsewhere;
but never before have I risen in a deliberative body, under more
oppressed feelings, or with a deeper sense of awful responsibility.
Never before have I risen to express my opinions upon any public
measure, fraught with such tremendous consequences to the welfare
and prosperity of the country, and so perilous to the liberties of
the people, as I solemnly believe the bill under consideration will
be. If you knew, sir, what sleepless hours reflection upon it has
cost me, if you knew with what fervor and sincerity I have implored
divine assistance to strengthen and sustain me in my opposition to
it, I should have credit with you, at least, for the sincerity of
my convictions, if I shall be so unfortunate as not to have your
concurrence as to the dangerous character of the measure. And I have
thanked my God that he has prolonged my life until the present time,
to enable me to exert myself in the service of my country, against a
project far transcending in pernicious tendency any that I have ever
had occasion to consider. I thank him for the health I am permitted to
enjoy; I thank him for the soft and sweet repose which I experienced
last night; I thank him for the bright and glorious sun which shines
upon us this day.
It is not my purpose, at this time, Mr. President, to go at large
into a consideration of the causes which have led to the present most
disastrous state of public affairs. That duty was performed by others,
and myself, at the extra session of congress. It was then clearly
shown, that it sprung from the ill-advised and unfortunate measures of
executive administration. I now will content myself with saying that,
on the fourth day of March, 1829, Andrew Jackson, not by the blessing
of God, was made president of these United States; that the country
then was eminently prosperous; that its currency was as sound and safe
as any that a people were ever blessed with; that, throughout the wide
extent of this whole union, it possessed a uniform value; and that
exchanges were conducted with such regularity and perfection, that
funds could be transmitted from one extremity of the union to the other,
with the least possible risk or loss. In this encouraging condition of
the business of the country, it remained for several years, until after
the war, wantonly waged against the late bank of the United States, was
completely successful, by the overthrow of that invaluable institution.
What our present situation is, is as needless to describe as it is
painful to contemplate. First felt in our great commercial marts,
distress and embarrassment have penetrated into the interior, and now
pervade almost the entire union. It has been justly remarked by one
of the soundest and most practical writers that I have had occasion
to consult, that ‘all convulsions in the circulation and commerce of
every country must originate in the operations of the government, or
in the mistaken views and erroneous measures of those possessing the
power of influencing credit and circulation; for they are not otherwise
susceptible of convulsion; and, if left to themselves, they will find
their own level, and flow nearly in one uniform stream.’
Yes, Mr. President, we all have but too melancholy a consciousness
of the unhappy condition of our country. We all too well know, that
our noble and gallant ship lies helpless and immovable upon breakers,
dismasted, the surge beating over her venerable sides, and the crew
threatened with instantaneous destruction. How came she there? Who
was the pilot at the helm when she was stranded? The party in power!
The pilot was aided by all the science and skill, by all the charts
and instruments, of such distinguished navigators as Washington, the
Adamses, Jefferson, Madison, and Monroe; and yet he did not, or could
not, save the public vessel. She was placed in her present miserable
condition by his bungling navigation, or by his want of skill and
judgment. It is impossible for him to escape from one or the other
horn of that dilemma. I leave him at liberty to choose between them.
I shall endeavor, Mr. President, in the course of the address I am
about making, to establish certain propositions, which I believe to
be incontestable; and, for the sake of perspicuity, I will state them
severally to the senate. I shall contend,
First, that it was the deliberate purpose and fixed design of the late
administration to establish a government bank――a treasury bank――to be
administered and controlled by the executive department.
Secondly, that, with that view, and to that end, it was its aim and
intention to overthrow the whole banking system, as existing in the
United States when that administration came into power, beginning with
the bank of the United States, and ending with the state banks.
Thirdly, that the attack was first confined, from considerations of
policy, to the bank of the United States; but that, after its overthrow
was accomplished, it was then directed, and has since been continued,
against the state banks.
Fourthly, that the present administration, by its acknowledgments,
emanating from the highest and most authentic source, has succeeded to
the principles, plans, and policy, of the preceding administration, and
stands solemnly pledged to complete and perfect them.
And, fifthly, that the bill under consideration is intended to execute
the pledge, by establishing, upon the ruins of the late bank of the
United States, and the state banks, a government bank, to be managed
and controlled by the treasury department, acting under the commands of
the president of the United States.
I believe, solemnly believe, the truth of every one of these five
propositions. In the support of them, I shall not rely upon any
gratuitous surmises or vague conjectures, but upon proofs, clear,
positive, undeniable, and demonstrative. To establish the first four,
I shall adduce evidence of the highest possible authenticity, or facts
admitted or undeniable, and fair reasoning founded on them. And as
to the last, the measure under consideration, I think the testimony,
intrinsic and extrinsic, on which I depend, stamps, beyond all doubt,
its true character as a government bank, and ought to carry to the mind
of the senate the conviction which I entertain, and in which I feel
perfectly confident the whole country will share.
First. My first proposition is, that it was the deliberate purpose
and fixed design of the late administration to establish a government
bank――a treasury bank――to be administered and controlled by the
executive department. To establish its truth, the first proof which I
offer is the following extract from president Jackson’s annual message
of December, 1829.
‘The charter of the bank of the United States expires in 1836,
and its stockholders will most probably apply for a renewal of
their privileges. In order to avoid the evils resulting from
precipitancy, in a measure involving such important principles,
and such deep pecuniary interests, I feel that I cannot, in
justice to the parties interested, too soon present it to
the consideration of the legislature and the people. Both
the constitutionality and the expediency of the law creating
this bank, are _well questioned by a large portion of our
fellow-citizens_; and it must be _admitted by all_, that it
has failed in the great end of establishing a uniform and sound
currency.
‘Under these circumstances, if such an institution is deemed
essential to the fiscal operations of the government, _I submit
to the wisdom of the legislature_, whether a national one,
founded upon _the credit of the government and its revenues_,
might not be devised, which would avoid all constitutional
difficulties, and, at the same time, secure all the advantages
to the government and the country, that were expected to result
from the present bank.’
This was the first open declaration of that implacable war against
the late bank of the United States, which was afterwards waged
with so much ferocity. It was the sound of the distant bugle, to
collect together the dispersed and scattered forces, and prepare
for battle. The country saw with surprise the statement, that ‘the
constitutionality and expediency of the law creating this bank are
well questioned _by a large portion_ of our fellow-citizens,’ when,
in truth and in fact, it was well known that but few then doubted the
constitutionality, and none the expediency, of it. And the assertion
excited much greater surprise, that ‘it must be _admitted by all_,
that it has failed in the great end of establishing a uniform and sound
currency.’ In this message, too, whilst a doubt is intimated as to
the utility of such an institution, president Jackson clearly first
discloses his object to establish a national one, founded upon the
_credit of the government and its revenues_. His language is perfectly
plain and unequivocal. Such a bank, founded upon the credit of the
government and its revenues, would secure all the advantages to the
government and the country, he tells us, that were expected to result
from the present bank.
In his annual message of the ensuing year, the late president says:
‘The importance of the principles involved in the inquiry,
whether it will be proper to recharter the bank of the United
States, requires that I should again call the attention of
congress to the subject. Nothing has occurred to lessen, in any
degree, the dangers which many of our citizens apprehend from
that institution, as at _present organized_. In the spirit of
improvement and compromise which distinguishes our country and
its institutions, it becomes us to inquire, _whether it be not
possible to secure the advantages afforded by the present bank,
through the agency of a bank of the United States, so modified
in its principles_ as to obviate constitutional and other
objections.
‘It is thought practicable to organize such a bank, with the
necessary officers, _as a branch of the treasury department_,
based on the public and individual deposits, without power to
make loans, or purchase property, which shall remit the funds
of government; and the expense of which may be paid, if thought
advisable, by allowing its officers _to sell bills of exchange_,
to private individuals, at a moderate premium. Not being a
corporate body, having no stockholders, debtors, and property,
and but few officers, it would not be obnoxious to the
constitutional objections which are urged against the present
bank; and having no means to operate on the hopes, fears, or
interests, of large masses of the community, it would be shorn
of the influence which makes that bank formidable.’
In this message president Jackson, after again adverting to the
imaginary dangers of a bank of the United States, recurs to his
favorite project, and inquires, ‘whether it be not possible to secure
the advantages afforded by the present bank, through the agency of a
bank of the United States, so modified in its principles and structure
as to obviate constitutional and other objections.’ And to dispel all
doubts of the timid, and to confirm the wavering, he declares, that
it is thought practicable to organize such a bank, with the necessary
officers, as a branch of the treasury department. _As a branch of the
treasury department!_ The very scheme now under consideration. And, to
defray the expenses of such an anomalous institution, he suggests, that
the officers of the treasury department may turn bankers and brokers,
and sell bills of exchange to private individuals at a moderate premium!
In his annual message of the year 1831, upon this subject, he was
brief and somewhat covered in his expressions. But the fixed purpose
which he entertained is sufficiently disclosed to the attentive reader.
He announces, that ‘entertaining the opinions _heretofore_ expressed in
relation to the bank of the United States, _as at present organized_,
I felt it my duty, in my former messages, frankly to disclose them,
in order that the attention of the legislature and the people should
be seasonably directed to that important subject, and that it might
be considered, and finally disposed of, in a manner best calculated
to promote the ends of the constitution, and subserve the public
interests.’ What were the opinions ‘heretofore’ expressed, we have
clearly seen. They were adverse to the bank of the United States,
as at present _organized_, that is to say, an organization with any
independent corporate government; and in favor of a national bank
which should be so constituted as to be subject to exclusive executive
control.
At the session of 1831–2, the question of the recharter of the bank
of the United States came up; and although the attention of congress
and the country had been repeatedly and deliberately before invited
to the consideration of it by president Jackson himself, the agitation
of it was now declared by him and his partisans to be precipitate
and premature. Nevertheless, the country and congress conscious of
the value of a safe and sound uniform currency, conscious that such a
currency had been eminently supplied by the bank of the United States,
and unmoved by all the outcry raised against that admirable institution,
the recharter commanded large majorities in both houses of congress.
Fatally for the interests of this country, the stern self-will of
general Jackson prompted him to risk every thing upon its overthrow.
On the tenth of July, 1832, the bill was returned with his veto; from
which the following extract is submitted to the attentive consideration
of the senate.
‘A bank of the United States is, in many respects, convenient
for the government and useful to the people. Entertaining this
opinion, and deeply impressed with the belief that some of
the powers and privileges possessed by the existing bank are
unauthorized by the constitution, subversive of the rights of
the states, and dangerous to the liberties of the people, I felt
it my duty, at an early period of my administration, to call
the attention of congress to the practicability _of organizing
an institution_, combining all _its advantages_, and obviating
these objections. I sincerely regret that, in the act before me,
I can perceive none of those modifications of the bank charter
which are necessary, in my opinion, to make it compatible with
justice, with sound policy, or with the constitution of our
country.
‘That a bank of the United States, competent to all the duties
which may be required by government, might be so organized as
not to infringe upon our own delegated powers, or the reserved
rights of the states, I do not entertain _a doubt_. Had the
executive been called upon to furnish _the project of such an
institution, the duty would have been cheerfully performed_.
In the absence of such a call, it is obviously proper that
he should confine himself to pointing out those prominent
features in the act presented, which, in his opinion, make it
incompatible with the constitution and sound policy.’
President Jackson admits, in the citation which has just been made,
that a bank of the United States is, in many respects, convenient for
the government; and reminds congress that he had, at an early period
of his administration, called its attention to the practicability of so
organizing such an institution as to secure all its advantages, without
the defects of the existing bank. It is perfectly manifest, that he
alludes to his previous recommendations of a government, a treasury
bank. In the same message he tells congress, that if he had been
called upon to _furnish the project_ of such an institution, the duty
would have been cheerfully performed. Thus it appears, that he had not
only settled in his mind the general principle, but had adjusted the
details of a government bank, to be subjected to executive control;
and congress is even chided for not calling upon him to present them.
The bill now under consideration, beyond all controversy, is the very
project which he had in view, and is to consummate the work which he
began. I think, Mr. President, that you must now concur with me in
considering the first proposition as fully maintained. I pass to the
second and third, which, on account of their intimate connection, I
will consider together.
Second, that with the view of establishing a government bank, it was
the settled aim and intention of the late administration, to overthrow
the whole banking system of the United States, as existing in the
United States when that administration came into power, beginning
with the bank of the United States, and ending with the state banks.
Third, that the attack was first confined, from considerations of
policy, to the bank of the United States; but that, after its overthrow
was accomplished, it was then directed, and has since been continued,
against the state banks.
We are not bound to inquire into the motives of president Jackson
for desiring to subvert the established monetary and financial system,
which he found in operation; and yet some examination into those which
probably influenced his mind, is not without utility. These are to
be found in his peculiar constitution and character. His egotism and
vanity, prompted him to subject every thing to his will; to change,
to remould, and retouch every thing. Hence the proscription which
characterized his administration, the universal expulsion from office,
at home and abroad, of all who were not devoted to him, and the attempt
to render the executive department of government, to use a favorite
expression of his own, a complete ‘unit.’ Hence his seizure of the
public deposits, in the bank of the United States, and his desire to
unite the purse with the sword. Hence his attack upon all the systems
of policy which he found in practical operation, on that of internal
improvements, and on that of the protection of national industry. He
was animated by the same sort of ambition which induced the master
mind of the age, Napoleon Bonaparte, to impress his name upon every
thing in France. When I was in Paris, the sculptors were busily engaged
chiselling out the famous N., so odious to the Bourbon line, which
had been conspicuously carved on the palace of the Tuilleries, and on
other public edifices and monuments, in the proud capital of France.
When, Mr. President, shall we see effaced, all traces of the ravages
committed by the administration of Andrew Jackson! Society has been
uprooted, virtue punished, vice rewarded, and talents and intellectual
endowments despised; brutality, vulgarism, and loco focoism upheld,
cherished, and countenanced. Ages will roll around before the moral
and political ravages which have been committed, will, I fear,
cease to be discernible. General Jackson’s ambition was to make his
administration an era in the history of the American government, and he
has accomplished that object of his ambition; but I trust that it will
be an era to be shunned as sad and lamentable, and not followed and
imitated as supplying sound maxims and principles of administration.
I have heard his hostility to banks ascribed to some collision which he
had with one of them, during the late war, at the city of New Orleans;
and it is possible that may have had some influence upon his mind. The
immediate cause, more probably, was the refusal of that perverse and
unaccommodating gentleman, Nick Biddle, to turn out of the office of
president of the New Hampshire branch of the bank of the United States,
at the instance of his excellency Isaac Hill, in the summer of 1829,
that giant-like person, Jeremiah Mason――giant in body, and giant in
mind. War and strife, endless war and strife, personal or national,
foreign or domestic, were the aliment of the late president’s existence.
War against the bank, war against France, and strife and contention
with a countless number of individuals. The wars with Black Hawk and
the Seminoles were scarcely a luncheon for his voracious appetite. And
he made his exit from public life, denouncing war and vengeance against
Mexico and the state banks.
My acquaintance with that extraordinary man commenced in this city,
in the fall of 1815 or 1816. It was short, but highly respectful, and
mutually cordial. I beheld in him the gallant and successful general,
who, by the glorious victory of New Orleans, had honorably closed
the second war of our independence, and I paid him the homage due to
that eminent service. A few years after, it became my painful duty
to animadvert, in the house of representatives, with the independence
which belongs to the representative character, upon some of his
proceedings, in the conduct of the Seminole war, which I thought
illegal, and contrary to the constitution and the law of nations.
A non-intercourse between us ensued, which continued until the fall
of 1824, when, he being a member of the senate, it was sought to
bring about an accommodation between us, by the principal part of the
delegation from his own state. For that purpose, we were invited to
dine with them, at Claxton’s boarding-house, on Capitol hill, where my
venerable friend from Tennessee, (Mr. White,) and his colleague on the
Spanish commission, were both present. I retired early from dinner, and
was followed to the door by general Jackson and the present minister
of the United States at the court of Madrid. They pressed me earnestly
to take a seat with them in their carriage. My faithful servant and
friend, Charles, was standing at the door, waiting for me, with my
own. I yielded to their urgent politeness, directed Charles to follow
with my carriage, and they sat me down at my own door. We afterwards
frequently met, with mutual respect and cordiality; dined several times
together, and reciprocated the hospitality of our respective quarters.
This friendly intercourse continued, until the election, in the house
of representatives, of a president of the United States, came on, in
February, 1825. I gave the vote which, in the contingency that happened,
I told my colleague, (Mr. Crittenden,) who sits before me, prior to
my departure from Kentucky, in November, 1824, and told others, that I
should give. All intercourse ceased between general Jackson and myself.
We have never since, except once accidentally, exchanged salutations,
nor met, except on occasions when we were performing the last offices
towards deceased members of congress, or other officers of government.
Immediately after my vote, a rancorous war was commenced against me,
and all the barking dogs let loose upon me. I shall not trace it during
its ten years’ bitter continuance. But I thank my God that I stand here,
firm and erect, unbent, unbroken, unsubdued, unawed, ready to denounce
the mischievous measures of his administration, and ready to denounce
this, its legitimate offspring, the most pernicious of them all.
His administration consisted of a succession of astounding measures,
which fell on the public ear like repeated bursts of loud and appalling
thunder. Before the reverberations of one peal had ceased, another and
another came, louder and louder, and more terrifying. Or rather, it was
like a volcanic mountain, emitting frightful eruptions of burning lava.
Before one was cold and crusted, before the voices of the inhabitants
of buried villages and cities were hushed in eternal silence, another,
more desolating, was vomited forth, extending wider and wider the
circle of death and destruction.
Mr. President, this is no unnecessary digression. The personal
character of such a chief as I have been describing, his passions,
his propensities, the character of his mind, should be all thoroughly
studied, to comprehend clearly his measures and his administration. But
I will now proceed to more direct and strict proofs of my second and
third propositions. That he was resolved to break down the bank of the
United States, is proved by the same citations from his messages which
I have made to exhibit his purpose to establish a treasury bank, is
proved by his veto message, and by the fact that he did destroy it.
The war against all other banks was not originally announced, because
he wished the state banks to be auxiliaries in overthrowing the bank
of the United States, and because such an annunciation would have been
too rash and shocking, upon the people of the United States, for even
his tremendous influence. It was necessary to proceed in the work with
caution, and to begin with that institution against which could be
embodied the greatest amount of prejudice. The refusal to recharter
the bank of the United States was followed by a determination to
remove from its custody the public money of the United States.
That determination was first whispered in this place, denied, again
intimated, and, finally, in September, 1833, executed. The agitation
of the American public which ensued, the warm and animated discussions,
in the country and in congress, to which that unconstitutional measure
gave rise, are all fresh in our recollection. It was necessary to quiet
the public mind, and to reconcile the people to what had been done,
before president Jackson seriously entered upon his new career of
hostility to the state banks. At the commencement of the session of
congress, in 1834, he imagined a sufficient calm had been produced,
and, in his annual message of that year, the war upon the state banks
was opened. In that message he says:
‘It seems due to the safety of the public funds remaining
in that bank, and to the honor of the American people, that
measures be taken to _separate_ the government entirely, from
an institution so mischievous to the public prosperity, and so
regardless of the constitution and laws. By transferring the
public deposits, by appointing other pension agents, as far as
it had the power, by ordering the discontinuance of the receipt
of bank checks, in payment of the public dues, after the first
day of January next, the executive has exerted all its lawful
authority, to _sever_ the connection between the government and
this faithless corporation.’
In this quotation, it will be seen that the first germ is contained
of that separation and divorce of the government from banks, which
has recently made such a conspicuous figure. It relates, it is true,
to the late bank of the United States, and he speaks of separating and
severing the connection between the government and that institution.
But the idea, once developed, was easily susceptible of application to
all banking institutions. In the message of the succeeding year, his
meditated attack upon the state banks, is more distinctly disclosed.
Speaking of a sound currency, he says:
‘In considering the means of obtaining so important an end,
(that is, a sound currency,) we must set aside all calculations
of _temporary_ convenience, and be influenced by those only that
are in harmony with the true character and permanent interests
of the republic. We must recur to _first principles_, and see
what it is that has prevented the legislation of congress _and
the states_, on the subject of currency, from satisfying the
public expectation, and realizing results corresponding to
those which have attended the action of our system, when truly
consistent with the great principle of equality upon which it
rests, and with that spirit of forbearance and mutual concession
and generous patriotism, which was originally, and must ever
continue to be, the vital element of our union.
‘On this subject, I am sure that I cannot be mistaken, in
ascribing our want of success to the undue countenance which
has been afforded to the _spirit of monopoly_. All the serious
dangers which our system has yet encountered, may be traced
to the resort to implied powers, _and the use of corporations_
clothed with privileges, the effect of which is to advance the
interests of the few at the expense of the many. We have felt
_but one class_ of these dangers, exhibited in the contest
waged by the bank of the United States, against the government,
for the last four years. Happily they have been obviated for
the present, by the indignant resistance of the people; but we
should recollect that the principle whence they sprang is an
ever-active one, which will not fail to renew its efforts in
the same and in other forms, so long as there is a hope of
success, founded either on the inattention of the people, or
the treachery of their representatives, to the subtle progress
of its influence.’
* * * * ‘We are now to see whether, in the present favorable
condition of the country, we cannot take an _effectual stand
against this spirit_ of monopoly, and practically prove, in
respect to the currency, as well as other important interests,
that there is no necessity for so extensive a resort to it as
that which has been heretofore practiced.’
* * * * ‘It has been seen, that without the agency of a great
moneyed monopoly, the revenue can be collected, and conveniently
and safely applied to all the purposes of the public expenditure.
It is also ascertained that, instead of being necessarily
made to promote the evils of an unchecked paper system, the
management of the revenue _can be made_ auxiliary to the reform
which the legislatures of several of the states have already
commenced, in regard to the suppression of small bills; and
which has only to be fostered _by proper regulations on the
part of congress_, to secure a practical return, to the extent
required for the security of the currency, to the constitutional
medium.’
As in the instance of the attack upon the bank of the United States,
the approach to the state banks is slow, cautious, and insidious. He
reminds congress and the country that all calculations of temporary
convenience must be set aside; that we must recur to first principles;
and that we must see what it is that has prevented the legislation
of congress _and the states_ on the subject of the currency from
satisfying public expectation. He declares his conviction that the
want of success has proceeded from the undue countenance which has
been afforded to the spirit of monopoly. All the serious dangers which
our system has yet encountered, may be traced to the resort to implied
powers, and _to the use of corporations_. We have felt, he says,
but one class of these dangers in the contest with the bank of the
United States, and he clearly intimates that the _other_ class is the
state banks. We are now to see, he proceeds, whether in the present
favorable condition of the country, we cannot take an effectual stand
against this spirit of monopoly. Reverting to his favorite scheme of
a government bank, he says it is ascertained, that, instead of being
made necessary to promote the evils of an unchecked _paper system, the
management of the revenue_ can be made auxiliary to the reform which he
is desirous to introduce. The designs of president Jackson against the
state banks are more fully developed and enlarged upon in his annual
message of 1836, from which I beg leave to quote the following passages.
‘I beg leave to call your attention to another subject,
intimately associated with the preceding one――_the currency of
the country_.
‘It is apparent, from the whole context of the constitution,
as well as the history of the times that gave birth to it, that
it was the purpose of the convention to establish a currency
consisting of _the precious metals_. These, from their peculiar
properties, which rendered them the standard of value in all
other countries, were adopted in this, as well to establish
its commercial standard, in reference to foreign countries,
by a permanent rule, as to exclude the use of a mutable medium
of exchange, such as of certain agricultural commodities,
recognised by the statutes of some states, as a tender for debts,
or the still more pernicious expedient of a paper currency.’
‘Variableness must ever be the characteristic of a currency of
which the precious metals are not the chief ingredient, or which
can be expanded or contracted, without regard to the principles
that regulate the value of those metals as a standard in the
general trade of the world. With us, bank issues constitute such
a currency, and must ever do so, until they are made dependent
on those just proportions of gold and silver, as a circulating
medium, which experience has proved to be necessary, not only
in this, but in all other commercial countries. Where those
proportions are not infused into the circulation, and do not
control it, it is manifest that prices must vary according to
the tide of bank issues, and the value and stability of property
must stand exposed to all the uncertainty which attends the
administration of institutions that are constantly liable to the
temptation of an interest distinct from that of the community in
which they are established.’
‘But although various dangers to our republican institutions
have been obviated by the failure of that bank to extort from
the government a renewal of its charter, it is obvious that
little has been accomplished, except a salutary change of public
opinion towards restoring to the country the sound currency
provided for in the constitution. In the acts of several of
the states prohibiting the circulation of small notes, and the
auxiliary enactments of congress at the last session, forbidding
their reception or payment on public account, the true policy
of the country has been advanced, and a larger portion of the
precious metals infused into our circulating medium. These
measures will probably be followed up in due time, by the
enactment of state laws, banishing from circulation bank
notes of still higher denominations; and the object may be
materially promoted by further acts of congress, forbidding
the employment, as fiscal agents, of such banks as issue notes
of low denominations, and throw impediments in the way of the
circulation of gold and silver.
‘The effects of an extension of _bank credits_ and over issues
of bank paper have been strikingly illustrated in the sales of
the public lands. From the returns made by the various registers
and receivers in the early part of last summer, it was perceived
that the receipts arising from the sales of public lands were
increasing to an unprecedented amount. In effect, however,
these receipts amount to nothing more than credits in banks.
The banks lent out their notes to speculators; they were paid
to the receivers, and immediately returned to the banks, to be
lent out again and again, being mere instruments to transfer
to speculators the most valuable public land, and pay the
government by a credit on the books of the banks. Those credits
on the books of some of the western banks, usually called
deposits, were already greatly beyond their immediate means of
payment, and were rapidly increasing. Indeed, each speculation
furnished means for another: for no sooner had one individual
or company paid in the notes, than they were immediately lent to
another for a like purpose; and the banks were extending their
business and their issues so largely as to alarm considerate men,
and render it doubtful whether _these bank credits, if permitted
to accumulate, would ultimately be of the least value to the
government_. The spirit of expansion and speculation was not
confined to the deposit banks, but pervaded the whole multitude
of banks throughout the union, and was giving rise to new
institutions to aggravate the evil.
‘The safety of the public funds, and the interest of the people
generally, required that these operations should be checked;
and it became the duty of every branch of the general and state
governments, to adopt all legitimate and proper means to produce
that salutary effect. Under this view of my duty, I directed
the issuing of the order, which will be laid before you by
the secretary of the treasury, requiring payment of the public
lands sold, to be made in specie, with an exception until the
fifteenth of the present month in favor of actual settlers. This
measure has produced many salutary consequences. It checked the
career of the western banks, and gave them additional strength
in anticipation of the pressure which has since pervaded our
eastern as well as the European commercial cities. By preventing
the expansion of the credit system, it measurably cut off the
means of speculation, and retarded its progress in monopolizing
the most valuable of the public lands. It has tended to save
the new states from a non-resident proprietorship; one of the
greatest obstacles to the advancement of a new country, and the
prosperity of an old one. It has tended to keep open the public
lands for entry by emigrants at government prices, instead of
their being compelled to purchase of speculators at double or
treble prices. And it is conveying into the interior, large sums
in silver and gold, there to enter permanently into the currency
of the country, and place it on a firmer foundation. It is
confidently believed that the country will find, in the motives
which induced that order, and the happy consequences which have
ensued, much to commend, and nothing to condemn.’
It is seen that he again calls the attention of congress to the
currency of the country, alleges that it was apparent from the whole
context of the constitution, as well as the history of the times
that gave birth to it, that it was the purpose of the convention to
establish a currency consisting of the _precious metals_; imputes
variableness and a liability to inordinate contraction and expansion
to the existing paper system, and denounces bank issues, as being an
uncertain standard. He felicitates himself upon the dangers which have
been obviated by the overthrow of the bank of the United States, but
declares that little has been yet done, except to produce a salutary
change of public opinion towards restoring to the country, the sound
currency _provided for in the constitution_. I will here say, in
passing, that all this outcry about the precious metals, gold, and the
constitutional currency, has been put forth to delude the people, and
to use the precious metals as an instrument to break down the banking
institutions of the states, and to thus pave the way for the ultimate
establishment of a great government bank. In the present advanced
state of civilization, in the present condition of the commerce of the
world, and in the actual relations of trade and intercourse between the
different nations of the world, it is perfectly chimerical to suppose
that the currency of the United States should consist exclusively, or
principally, of the precious metals.
In the quotations which I have made from the last annual message of
general Jackson, he speaks of the extension of bank credits, and the
over-issues of bank paper, in the operations upon the sales of public
lands. In his message of only the preceding year, the vast amount
of those sales had been dwelt upon with peculiar complaisance, as
illustrating the general prosperity of the country, and as proof of
the wisdom of his administration. But now that which had been announced
as a blessing, is deprecated as a calamity. Now, his object being to
assail the banking institutions of the states, and to justify that
fatal treasury order, which I shall hereafter have occasion to notice,
he expresses his apprehension of the danger to which we are exposed of
losing the public domain, and getting nothing for it but _bank credits_.
He describes, minutely, the circular process by which the notes of the
banks passed out of those institutions, to be employed in the purchase
of the public lands, and returned again to them in the form of credits
to the government. He forgets that Mr. Secretary Taney, to reconcile
the people of the United States to the daring measure of removing the
public deposits, had stimulated the banks to the exercise of great
liberality in the grant of loans. He informs us, in that message,
that the safety of the public funds, and the interests of the people
generally, required that these copious issues of the banks should be
checked, and that the conversion of the public lands into mere bank
credits should be arrested. And his measure to accomplish these objects,
was that famous treasury order, already adverted to. Let us pause here
for a moment, and contemplate the circumstances under which it was
issued. The principle of the order had been proposed and discussed
in congress. But one senator, as far as I know, in this branch of the
legislature, and not a solitary member, within my knowledge, in the
house of representatives, was in favor of it. And yet, in about a week
after the adjournment of congress, the principle which met with no
countenance from the legislative authority, was embodied in the form of
a treasury edict, and promulgated under the executive authority, to the
astonishment of the people of the United States!
If we possessed no other evidence whatever of the hostility of
president Jackson to the state banks of the United States, that order
would supply conclusive proof. Bank notes, bank issues, bank credits,
were distrusted and denounced by him. It was proclaimed to the people,
that they were unworthy of confidence. The government could no longer
trust in their security. And at a moment when the banking operations
were extended, and stretched to their utmost tension; when they were
almost all tottering and ready to fall, for the want of that metallic
basis on which they all rested, the executive announces its distrust,
issues the treasury order, and enters the market for specie, by a
demand of an extraordinary amount to supply the means of purchasing
the public lands. If the sales had continued in the same ratio they
had been made during the previous year, that is, at about the rate of
twenty-four millions _per annum_, this unprecedented demand created
by government for specie, must have exhausted the vaults of most of
the banks, and produced much sooner the catastrophe which occurred
in May last. And, what is most extraordinary, this wanton demand for
specie upon all the banks of the commercial capitals, and in the busy
and thickly peopled portions of the country, was that it might be
transported into the wilderness, and, after having been used in the
purchase of public lands, deposited to the credit of the government in
the books of western banks, in some of which, according to the message,
they were already credits to the government ‘greatly beyond their
immediate means of payment.’ Government, therefore, did not itself
receive, or rather, did not retain, the very specie which it professed
to demand as the only medium worthy of the public lands. The specie,
which was so uselessly exacted, was transferred from one set of banks,
to the derangement of the commerce and business of the country, and
placed in the vaults of another set of banks in the interior, forming
only those bank credits to the government upon which president Jackson
placed so slight a value.
Finally, when general Jackson was about to retire from the cares of
government, he favored his countrymen with a farewell address. The
solemnity of the occasion gives to any opinions which he has expressed
in that document a claim to peculiar attention. It will be seen on
perusing it, that he denounces, more emphatically than in any of his
previous addresses, the bank paper of the country, corporations, and
what he chooses to denominate the spirit of monopoly. The senate will
indulge me in calling its attention to certain parts of that address,
in the following extracts.
‘The constitution of the United States unquestionably intended
to secure to the people, a circulating medium of gold and silver.
But the establishment of a national bank by congress, with
the privilege of issuing paper money, receivable in payment
of the public dues, and the unfortunate cause of legislation
in the several states upon the same subject, drove from general
circulation the constitutional currency, and substituted one of
paper in its place.’
‘The mischief springs from the power which the moneyed interest
derives from a paper currency, which they are able to control;
from the multitude of corporations, with exclusive privileges,
which they have succeeded in obtaining in the different states,
and which are employed altogether for their benefit; and unless
you become more watchful in your states, and check this spirit
of monopoly, and thirst for exclusive privileges, you will, in
the end, find that the most important powers of government have
been given or bartered away, and the control over your dearest
interests has passed into the hands of these corporations.’
‘But it will require steady and persevering exertions on your
part to rid yourselves of the iniquities and mischiefs of the
paper system, and to check the spirit of monopoly and other
abuses which have sprung up with it, and of which it is the main
support. So many interests are united to resist all reform on
this subject, that you must not hope that the conflict will be
a short one, nor success easy. My humble efforts have not been
spared, during my administration of the government, to restore
the constitutional currency of gold and silver: and something,
I trust, has been done towards the accomplishment of this most
desirable object. But enough yet remains, to require all your
energy and perseverance. The power, however, is in your hands,
and the remedy must, and will be applied, if you determine upon
it.’
The mask is now thrown off, and he boldly says that the constitution of
the United States _unquestionably_ intended to secure to the people a
circulating medium of gold and silver. They have not enjoyed, he says,
that benefit, because of the establishment of a national bank, _and the
unfortunate course of legislation in the several states_. He does not
limit his condemnation of the past policy of his country to the federal
government, of which he had just ceased to be the chief, but he extends
it to the states also, as if they were incompetent to judge of the
interests of their respective citizens. He tells us that the mischief
springs from the power which the moneyed interest derives from a
paper currency, which they are able to control, and the multitude of
corporations; and he stimulates the people to become more watchful in
their several states, to check this spirit of monopoly. To invigorate
their fortitude, he tells the people that it will require steady
and persevering exertions on their part, to rid themselves of the
_iniquities_ and mischiefs of the paper system, and to check the spirit
of monopoly. They must not hope that the conflict will be a short
one, nor success easy. His humble efforts have not been spared during
his administration, to restore the constitutional currency of gold
and silver; and although he has been able to do something towards the
accomplishment of that object, _enough yet remains_ to require all the
energy and perseverance of the people.
Such, Mr. President, are the proofs and the argument on which I rely
to establish the second and third propositions which I have been
considering. Are they not successfully maintained? Is it possible that
any thing could be more conclusive on such a subject?