BANK OF THE UNITED STATES.--NON-RENEWAL OF CHARTER.
From the time of President Jackson's intimations against the
recharter of the Bank, in the annual message of 1829, there had
been a ceaseless and pervading activity in behalf of the Bank in
all parts of the Union, and in all forms--in the newspapers, in
the halls of Congress, in State legislatures, even in much of the
periodical literature, in the elections, and in the conciliation
of presses and individuals--all conducted in a way to operate most
strongly upon the public mind, and to conclude the question in the
forum of the people before it was brought forward in the national
legislature. At the same time but little was done, or could be done
on the other side. The current was all setting one way. I determined
to raise a voice against it in the Senate, and made several efforts
before I succeeded--the thick array of the Bank friends throwing
every obstacle in my way, and even friends holding me back for the
regular course, which was to wait until the application for the
renewed charter to be presented; and then to oppose it. I foresaw
that, if this course was followed, the Bank would triumph without
a contest--that she would wait until a majority was installed in
both Houses of Congress--then present her application--hear a few
barren speeches in opposition;--and then gallop the renewed charter
through. In the session of 1830, '31, I succeeded in creating
the first opportunity of delivering a speech against it; it was
done a little irregularly by submitting a negative resolution
against the renewal of the charter, and taking the opportunity
while asking leave to introduce the resolution, to speak fully
against the re-charter. My mind was fixed upon the character of
the speech which I should make--one which should avoid the beaten
tracks of objection, avoid all settled points, avoid the problem of
constitutionality--and take up the institution in a practical sense,
as having too much power over the people and the government,--over
business and politics--and too much disposed to exercise that power
to the prejudice of the freedom and equality which should prevail
in a republic, to be allowed to exist in our country. But I knew
it was not sufficient to pull down: we must build up also. The men
of 1811 had committed a fatal error, when most wisely refusing to
re-charter the institution of that day, they failed to provide a
substitute for its currency, and fell back upon the local banks,
whose inadequacy speedily made a call for the re-establishment of
a national bank. I felt that error must be avoided--that another
currency of general circulation must be provided to replace its
notes; and I saw that currency in the gold coin of the constitution,
then an ideal currency in the United States, having been totally
banished for many years by the erroneous valuation adopted in the
time of Gen. Hamilton, Secretary of the Treasury. I proposed to
revive that currency, and brought it forward at the conclusion of my
first speech (February, 1831) against the Bank, thus:
"I am willing to see the charter expire, without providing
any substitute for the present bank. I am willing to see the
currency of the federal government left to the hard money
mentioned and intended in the constitution; I am willing to have
a hard money government, as that of France has been since the
time of _assignats_ and _mandats_. Every species of paper might
be left to the State authorities, unrecognized by the federal
government, and only touched by it for its own convenience when
equivalent to gold and silver. Such a currency filled France
with the precious metals, when England, with her overgrown
bank, was a prey to all the evils of unconvertible paper. It
furnished money enough for the imperial government when the
population of the empire was three times more numerous, and the
expense of government twelve times greater, than the population
and expenses of the United States; and, when France possessed
no mines of gold or silver, and was destitute of the exports
which command the specie of other countries. The United States
possess gold mines, now yielding half a million per annum, with
every prospect of equalling those of Peru. But this is not the
best dependence. We have what is superior to mines, namely,
the exports which command the money of the world; that is to
say, the food which sustains life and the raw materials which
sustain manufactures. Gold and silver is the best currency for
a republic; it suits the men of middle property and the working
people best; and if I was going to establish a working man's
party, it should be on the basis of hard money:--a hard money
party, against a paper party."
In the speech which I delivered, I quoted copiously from British
speakers--not the brilliant rhetoricians, but the practical,
sensible, upright business men, to whom countries are usually
indebted for all beneficial legislation: the Sir Henry Parnells, the
Mr. Joseph Humes, the Mr. Edward Ellices, the Sir William Pulteneys;
and men of that class, legislating for the practical concerns of
life, and merging the orator in the man of business.
THE SPEECH--EXTRACTS.
"Mr. Benton commenced his speech in support of the application
for the leave he was about to ask, with a justification of
himself for bringing forward the question of renewal at this
time, when the charter had still five years to run; and bottomed
his vindication chiefly on the right he possessed, and the
necessity he was under to answer certain reports of one of
the committee of the Senate, made in opposition to certain
resolutions relative to the bank, which he had submitted to
the Senate at former sessions, and which reports he had not
had an opportunity of answering. He said it had been his
fortune, or chance, some three years ago, to submit a resolution
in relation to the undrawn balances of public money in the
hands of the bank, and to accompany it with some poor remarks
of unfavorable implication to the future existence of that
institution. My resolution [said Mr. B.] was referred to the
Committee on Finance, who made a report decidedly adverse to
all my views, and eminently favorable to the bank, both as a
present and future institution. This report came on the 13th of
May, just fourteen days before the conclusion of a six months'
session, when all was hurry and precipitation to terminate the
business on hand, and when there was not the least chance to
engage the attention of the Senate in the consideration of any
new subject. The report was, therefore, laid upon the table
unanswered, but was printed by order of the Senate, and that in
extra numbers, and widely diffused over the country by means of
the newspaper press. At the commencement of the next session,
it being irregular to call for the consideration of the past
report, I was under the necessity to begin anew, and accordingly
submitted my resolution a second time, and that quite early in
the session; say on the first day of January. It was my wish
and request that this resolution might be discussed in the
Senate, but the sentiment of the majority was different, and
a second reference of it was made to the Finance Committee. A
second report of the same purport with the first was a matter
of course; but what did not seem to me to be a matter of course
was this; that this second report should not come in until the
20th day of February, just fourteen days again before the end of
the session, for it was then the short session, and the Senate
as much pinched as before for time to finish the business on
hand. No answer could be made to it, but the report was printed,
with the former report appended to it; and thus, united like
the Siamese twins, and with the apparent, but not real sanction
of the Senate, they went forth together to make the tour of
the Union in the columns of the newspaper press. Thus, I was a
second time out of court; a second time nonsuited for want of a
replication, when there was no time to file one. I had intended
to begin _de novo_, and for the third time, at the opening
of the ensuing session; but, happily, was anticipated and
prevented by the annual message of the new President [General
Jackson], which brought this question of renewing the bank
charter directly before Congress. A reference of this part of
the message was made, of course, to the Finance Committee: the
committee, of course, again reported, and with increased ardor,
in favor of the bank. Unhappily this third report, which was an
amplification and reiteration of the two former, did not come in
until the session was four months advanced, and when the time of
the Senate had become engrossed, and its attention absorbed, by
the numerous and important subjects which had accumulated upon
the calendar. Printing in extra numbers, general circulation
through the newspaper press, and no answer, was the catastrophe
of this third reference to the Finance Committee. Thus was I
nonsuited for the third time. The fourth session has now come
round; the same subject is again before the same committee on
the reference of the part of the President's second annual
message which relates to the bank; and, doubtless, a fourth
report of the same import with the three preceding ones, may be
expected. But when? is the question. And, as I cannot answer
that question, and the session is now two thirds advanced, and
as I have no disposition to be cut off for the fourth time, I
have thought proper to create an occasion to deliver my own
sentiments, by asking leave to introduce a joint resolution,
adverse to the tenor of all the reports, and to give my reasons
against them, while supporting my application for the leave
demanded; a course of proceeding which is just to myself and
unjust to no one, since all are at liberty to answer me. These
are my personal reasons for this step, and a part of my answer
to the objection that I have begun too soon. The conduct of
the bank, and its friends, constitutes the second branch of my
justification. It is certainly not 'too soon' for them, judging
by their conduct, to engage in the question of renewing the bank
charter. In and out of Congress, they all seem to be of one
accord on this point. Three reports of committees in the Senate,
and one from a committee of the House of Representatives, have
been made in favor of the renewal; and all these reports,
instead of being laid away for future use--instead of being
stuck in pigeon holes, and labelled for future attention, as
things coming forth prematurely, and not wanted for present
service--have, on the contrary, been universally received by the
bank and its friends, in one great tempest of applause; greeted
with every species of acclamation; reprinted in most of the
papers, and every effort made to give the widest diffusion, and
the highest effect, to the arguments they contain. In addition
to this, and at the present session, within a few days past,
three thousand copies of the exposition of the affairs of the
Bank have been printed by order of the two Houses, a thing never
before done, and now intended to blazon the merits of the bank.
[Mr. Smith, of Maryland, here expressed some dissent to this
statement; but Mr. B. affirmed its correctness in substance if
not to the letter, and continued.] This does not look as if
the bank advocates thought it was _too soon_ to discuss the
question of renewing the charter; and, upon this exhibition of
their sentiments, I shall rest the assertion and the proof,
that they do not think so. The third branch of my justification
rests upon a sense of public duty; upon a sense of what is just
and advantageous to the people in general, and to the debtors
and stockholders of the bank in particular. The renewal of the
charter is a question which concerns the people at large; and if
they are to have any hand in the decision of this question--if
they are even to know what is done before it is done, it is high
time that they and their representatives in Congress should
understand each other's mind upon it. The charter has but five
years to run; and if renewed at all, will probably be at some
short period, say two or three years, before the time is out,
and at any time sooner that a chance can be seen to gallop the
renewal through Congress. The people, therefore, have no time
to lose, if they mean to have any hand in the decision of this
great question. To the bank itself, it must be advantageous, at
least, if not desirable, to know its fate at once, that it may
avoid (if there is to be no renewal) the trouble and expense
of multiplying branches upon the eve of dissolution, and the
risk and inconvenience of extending loans beyond the term of
its existence. To the debtors upon mortgages, and indefinite
accommodations, it must be also advantageous, if not desirable,
to be notified in advance of the end of their indulgences:
so that, to every interest, public and private, political
and pecuniary, general and particular, full discussion, and
seasonable decision, is just and proper.
"I hold myself justified, Mr. President, upon the reasons
given, for proceeding in my present application; but, as
example is sometimes more authoritative than reason, I will
take the liberty to produce one, which is as high in point of
authority as it is appropriate in point of application, and
which happens to fit the case before the Senate as completely
as if it had been made for it. I speak of what has lately been
done in the Parliament of Great Britain. It so happens, that
the charter of the Bank of England is to expire, upon its own
limitation, nearly about the same time with the charter of the
Bank of the United States, namely, in the year 1833; and as far
back as 1824, no less than nine years before its expiration,
the question of its renewal was debated, and that with great
freedom, in the British House of Commons. I will read some
extracts from that debate, as the fairest way of presenting the
example to the Senate, and the most effectual mode of securing
to myself the advantage of the sentiments expressed by British
statesman.
_The Extracts._
"'Sir Henry Parnell.--The House should no longer delay to turn
its attention to the expediency of renewing the charter of the
Bank of England. Heretofore, it had been the regular custom to
renew the charter several years before the existing charter had
expired. The last renewal was made when the existing charter
had eleven years to run: the present charter had nine years
only to continue, and he felt very anxious to prevent the
making of any agreement between the government and the bank for
a renewal, without a full examination of the policy of again
conferring upon the Bank of England any exclusive privilege. The
practice had been for government to make a secret arrangement
with the bank; to submit it immediately to the proprietors of
the bank for their approbation, and to call upon the House the
next day to confirm it, without affording any opportunity of
fair deliberation. So much information had been obtained upon
the banking trade, and upon the nature of currency in the last
fifteen years, that it was particularly necessary to enter upon
a full investigation of the policy of renewing the bank charter
before any negotiation should be entered upon between the
government and the bank; and he trusted the government would not
commence any such negotiation until the sense of Parliament had
been taken on this important subject.'
"'Mr. Hume said it was of very great importance that his
majesty's ministers should take immediate steps to free
themselves from the trammels in which they had long been held
by the bank. As the interest of money was now nearly on a level
with what it was when the bank lent a large sum to government,
he hoped the Chancellor of the Exchequer would not listen to any
application for a renewal of the bank charter, but would pay off
every shilling that had been borrowed from the bank. * * * * *
Let the country gentlemen recollect that the bank was now acting
as pawn-broker on a large scale, and lending money on estates,
a system entirely contrary to the original intention of that
institution. * * * * * * He hoped, before the expiration of the
charter, that a regular inquiry would be made into the whole
subject.'
"'Mr. Edward Ellice. It (the Bank of England) is a great
monopolizing body, enjoying privileges which belonged to no
other corporation, and no other class of his majesty's subjects.
* * * * * * * He hoped that the exclusive charter would never
again be granted; and that the conduct of the bank during the
last ten or twelve years would make government very cautious
how they entertained any such propositions. The right honorable
Chancellor of the Exchequer [Mr. Robinson] had protested against
the idea of straining any point to the prejudice of the bank; he
thought, however, that the bank had very little to complain of,
when their stock, after all their past profits, was at 238.'
"'The Chancellor of the Exchequer deprecated the discussion, as
leading to no practical result.'
"'Mr. Alexander Baring objected to it as premature and
unnecessary.'
"'Sir William Pulteney (in another debate). The prejudices in
favor of the present bank have proceeded from the long habit of
considering it as a sort of pillar which nothing can shake. * *
* * * * * The bank has been supported, and is still supported,
by the fear and terror which, by means of its monopoly, it has
had the power to inspire. It is well known, that there is hardly
an extensive trader, a manufacturer, or a banker, either in
London, or at a distance from it, to whom the bank could not do
a serious injury, and could often bring on even insolvency. * *
* * * I consider the power given by the monopoly to be of the
nature of all other despotic power, which corrupts the despot as
much as it corrupts the slave. * * * * * * It is in the nature
of man, that a monopoly must necessarily be ill-conducted. *
* * * * * * Whatever language the [private] bankers may feel
themselves obliged to hold, yet no one can believe that they
have any satisfaction in being, and continuing, under a dominion
which has proved so grievous and so disastrous. * * * * * * I
can never believe that the merchants and bankers of this country
will prove unwilling to emancipate themselves, if they can do
it without risking the resentment of the bank. No man in France
was heard to complain, openly, of the Bastile while it existed.
The merchants and bankers of this country have the blood of
Englishmen, and will be happy to relieve themselves from a
situation of perpetual terror, if they could do it consistently
with a due regard to their own interest.'
"Here is authority added to reason--the force of a great example
added to the weight of unanswerable reasons, in favor of early
discussion; so that, I trust, I have effectually put aside that
old and convenient objection to the 'time,' that most flexible
and accommodating objection, which applies to all seasons, and
all subjects, and is just as available for cutting off a late
debate, because it is too late, as it is for stifling an early
one, because it is too early.
"But, it is said that the debate will injure the stockholders;
that it depreciates the value of their property, and that
it is wrong to sport with the vested rights of individuals.
This complaint, supposing it to come from the stockholders
themselves, is both absurd and ungrateful. It is absurd,
because the stockholders, at least so many of them as are not
foreigners, must have known when they accepted a charter of
limited duration, that the approach of its expiration would
renew the debate upon the propriety of its existence; that
every citizen had a right, and every public man was under an
obligation, to declare his sentiments freely; that there was
nothing in the charter, numerous as its peculiar privileges
were, to exempt the bank from that freedom of speech and
writing, which extends to all our public affairs; and that the
charter was not to be renewed here, as the Bank of England
charter had formerly been renewed, by a private arrangement
among its friends, suddenly produced in Congress, and galloped
through without the knowledge of the country. The American part
of the stockholders (for I would not reply to the complaints
of the foreigners) must have known all this; and known it
when they accepted the charter. They adapted it, subject to
this known consequence; and, therefore, the complaint about
injuring their property is absurd. That it is ungrateful, must
be apparent to all who will reflect upon the great privileges
which these stockholders will have enjoyed for twenty years, and
the large profits they have already derived from their charter.
They have been dividing seven per cent. per annum, unless when
prevented by their own mismanagement; and have laid up a real
estate of three millions of dollars for future division; and
the money which has done these handsome things, instead of
being diminished or impaired in the process, is still worth
largely upwards of one hundred cents to the dollar: say, one
hundred and twenty-five cents. For the peculiar privileges which
enabled them to make these profits, the stockholders ought to
be grateful: but, like all persons who have been highly favored
with undue benefits, they mistake a privilege for a right--a
favor for a duty--and resent, as an attack upon their property,
a refusal to prolong their undue advantages. There is no ground
for these complaints, but for thanks and benedictions rather,
for permitting the bank to live out its numbered days! That
institution has forfeited its charter. It may be shut up at any
hour. It lives from day to day by the indulgence of those whom
it daily attacks; and, if any one is ignorant of this fact, let
him look at the case of the Bank of the United States against
Owens and others, decided in the Supreme Court, and reported in
the 2d Peters.
"[Here Mr. B. read a part of this case, showing that it was
a case of usury at the rate of forty-six per cent. and that
Mr. Sergeant, counsel for the bank, resisted the decision of
the Supreme Court, upon the ground that it would expose the
charter of the bank to forfeiture; and that the decision was,
nevertheless, given upon that ground; so that the bank, being
convicted of taking usury, in violation of its charter, was
liable to be deprived of its charter, at any time that a _scire
facias_ should issue against it.]
"Mr. B. resumed. Before I proceed to the consideration of
the resolution, I wish to be indulged in adverting to a rule
or principle of parliamentary practice, which it is only
necessary to read now in order to avoid the possibility of any
necessity for recurring to it hereafter. It is the rule which
forbids any member to be present--which, in fact, requires him
to withdraw--during the discussion of any question in which
his private interest may be concerned; and authorizes the
expurgation from the Journal of any vote which may have been
given under the predicament of an interested motive. I demand
that the Secretary of the Senate may read the rule to which I
allude.
"[The Secretary read the following rule:]
"'Where the private interests of a member are concerned in
a bill or question, he is to withdraw. And where such an
interest has appeared, his voice has been disallowed, even
after a division. In a case so contrary, not only to the laws
of decency, but to the fundamental principles of the social
compact, which denies to any man to be a judge in his own cause,
it is for the honor of the House that this rule, of immemorial
observance, should be strictly adhered to.'
"_First_: Mr. President, I object to the renewal of the charter
of the Bank of the United States, because I look upon the bank
as an institution too great and powerful to be tolerated in a
government of free and equal laws. Its power is that of the
purse; a power more potent than that of the sword; and this
power it possesses to a degree and extent that will enable this
bank to draw to itself too much of the political power of this
Union; and too much of the individual property of the citizens
of these States. The money power of the bank is both direct and
indirect.
"[The Vice-President here intimated to Mr. Benton that he was
out of order, and had not a right to go into the merits of the
bank upon the motion which he had made. Mr. Benton begged pardon
of the Vice-President, and respectfully insisted that he was in
order, and had a right to proceed. He said he was proceeding
upon the parliamentary rule of asking leave to bring in a joint
resolution, and, in doing which, he had a right to state his
reasons, which reasons constituted his speech; that the motion
was debatable, and the whole Senate might answer him. The
Vice-President then directed Mr. Benton to proceed.]
"Mr. B. resumed. The direct power of the bank is now prodigious,
and in the event of the renewal of the charter, must speedily
become boundless and uncontrollable. The bank is now authorized
to own effects, lands inclusive, to the amount of fifty-five
millions of dollars, and to issue notes to the amount of
thirty-five millions more. This makes ninety millions; and, in
addition to this vast sum, there is an opening for an unlimited
increase: for there is a dispensation in the charter to issue
as many more notes as Congress, by law, may permit. This
opens the door to boundless emissions; for what can be more
unbounded than the will and pleasure of successive Congresses?
The indirect power of the bank cannot be stated in figures;
but it can be shown to be immense. In the first place, it has
the keeping of the public moneys, now amounting to twenty-six
millions per annum (the Post Office Department included), and
the gratuitous use of the undrawn balances, large enough to
constitute, in themselves, the capital of a great State bank.
In the next place, its promissory notes are receivable, by law,
in purchase of all property owned by the United States, and in
payment of all debts due them; and this may increase its power
to the amount of the annual revenue, by creating a demand for
its notes to that amount. In the third place, it wears the
name of the United States, and has the federal government for
a partner; and this name, and this partnership, identifies the
credit of the bank with the credit of the Union. In the fourth
place, it is armed with authority to disparage and discredit
the notes of other banks, by excluding them from all payments
to the United States; and this, added to all its other powers,
direct and indirect, makes this institution the uncontrollable
monarch of the moneyed system of the Union. To whom is all this
power granted? To a company of private individuals, many of
them foreigners, and the mass of them residing in a remote and
narrow corner of the Union, unconnected by any sympathy with the
fertile regions of the Great Valley, in which the natural power
of this Union--the power of numbers--will be found to reside
long before the renewed term of a second charter would expire.
By whom is all this power to be exercised? By a directory of
seven (it may be), governed by a majority, of four (it may be);
and none of these elected by the people, or responsible to
them. Where is it to be exercised? At a single city, distant a
thousand miles from some of the States, receiving the produce of
none of them (except one); no interest in the welfare of any of
them (except one); no commerce with the people; with branches
in every State; and every branch subject to the secret and
absolute orders of the supreme central head: thus constituting
a system of centralism, hostile to the federative principle of
our Union, encroaching upon the wealth and power of the States,
and organized upon a principle to give the highest effect to
the greatest power. This mass of power, thus concentrated, thus
ramified, and thus directed, must necessarily become, under
a prolonged existence, the absolute monopolist of American
money, the sole manufacturer of paper currency, and the sole
authority (for authority it will be) to which the federal
government, the State governments, the great cities, corporate
bodies, merchants, traders, and every private citizen, must,
of necessity apply, for every loan which their exigencies may
demand. 'The rich ruleth the poor, and the borrower is the
servant of the lender.' Such are the words of Holy Writ; and
if the authority of the Bible admitted of corroboration, the
history of the world is at hand to give it. But I will not
cite the history of the world, but one eminent example only,
and that of a nature so high and commanding, as to include all
others; and so near and recent, as to be directly applicable to
our own situation. I speak of what happened in Great Britain,
in the year 1795, when the Bank of England, by a brief and
unceremonious letter to Mr. Pitt, such as a miser would write to
a prodigal in a pinch, gave the proof of what a great moneyed
power could do, and would do, to promote its own interest, in a
crisis of national alarm and difficulty. I will read the letter.
It is exceedingly short; for after the compliments are omitted,
there are but three lines of it. It is, in fact, about as long
as a sentence of execution, leaving out the prayer of the judge.
It runs thus:
"'It is the wish of the Court of Directors that the Chancellor
of the Exchequer would settle his arrangements of finances for
the present year, in such manner as not to depend upon any
further assistance from them, beyond what is already agreed for.'
"Such were the words of this memorable note, sufficiently
explicit and intelligible; but to appreciate it fully, we must
know what was the condition of Great Britain at that time?
Remember it was the year 1795, and the beginning of that year,
than which a more portentous one never opened upon the British
empire. The war with the French republic had been raging for
two years; Spain had just declared war against Great Britain;
Ireland was bursting into rebellion; the fleet in the Nore was
in open mutiny; and a cry for the reform of abuses, and the
reduction of taxes, resounded through the land. It was a season
of alarm and consternation, and of imminent actual danger to
Great Britain; and this was the moment which the Bank selected
to notify the minister that no more loans were to be expected!
What was the effect of this notification? It was to paralyze
the government, and to subdue the minister to the purposes of
the bank. From that day forth Mr. Pitt became the minister of
the bank; and, before two years were out, he had succeeded in
bringing all the departments of government, King, Lords, and
Commons, and the Privy Council, to his own slavish condition.
He stopped the specie payments of the bank, and made its
notes the lawful currency of the land. In 1797 he obtained an
order in council for this purpose; in the same year an act of
parliament to confirm the order for a month, and afterwards a
series of acts to continue it for twenty years. This was the
reign of the bank. For twenty years it was a dominant power in
England; and, during that disastrous period, the public debt
was increased about £400,000,000 sterling, equal nearly to two
thousand millions of dollars, and that by paper loans from
a bank which, according to its own declarations, had not a
shilling to lend at the commencement of the period! I omit the
rest. I say nothing of the general subjugation of the country
banks, the rise in the price of food, the decline in wages, the
increase of crimes and taxes, the multiplication of lords and
beggars, and the frightful demoralization of society. I omit all
this. I only seize the prominent figure in the picture, that
of a government arrested in the midst of war and danger by the
veto of a moneyed corporation; and only permitted to go on upon
condition of assuming the odium of stopping specie payments, and
sustaining the promissory notes of an insolvent bank, as the
lawful currency of the land. This single feature suffices to
fix the character of the times; for when the government becomes
the 'servant of the lender,' the people themselves become its
slaves. Cannot the Bank of the United States, if re-chartered,
act in the same way? It certainly can, and just as certainly
will, when time and opportunity shall serve, and interest may
prompt. It is to no purpose that gentlemen may come forward, and
vaunt the character of the United States Bank, and proclaim it
too just and merciful to oppress the state. I must be permitted
to repudiate both the pledge and the praise. The security is
insufficient, and the encomium belongs to Constantinople. There
were enough such in the British Parliament the year before,
nay, the day before the bank stopped; yet their pledges and
praises neither prevented the stoppage, nor made good the damage
that ensued. There were gentlemen in our Congress to pledge
themselves in 1810 for the then expiring bank, of which the one
now existing is a second and deteriorated edition; and if their
securityship had been accepted, and the old bank re-chartered,
we should have seen this government greeted with a note, about
August, 1814--about the time the British were burning this
capitol--of the same tenor with the one received by the younger
Pitt in the year 1795; for, it is incontestable, that that bank
was owned by men who would have glorified in arresting the
government, and the war itself, for want of money. Happily, the
wisdom and patriotism of Jefferson, under the providence of God,
prevented that infamy and ruin, by preventing the renewal of the
old bank charter.
"_Secondly._ I object to the continuance of this bank, because
its tendencies are dangerous and pernicious to the government
and the people.
"What are the tendencies of a great moneyed power, connected
with the government, and controlling its fiscal operations?
Are they not dangerous to every interest, public and
private--political as well as pecuniary? I say they are; and
briefly enumerate the heads of each mischief.
"1. Such a bank tends to subjugate the government, as I have
already shown in the history of what happened to the British
minister in the year 1795.
"2. It tends to collusions between the government and the
bank in the terms of the loans, as has been fully experienced
in England in those frauds upon the people, and insults upon
the understating, called three per cent. loans, in which the
government, for about £50 borrowed, became liable to pay £100.
"3. It tends to create public debt, by facilitating public
loans, and substituting unlimited supplies of paper, for
limited supplies of coin. The British debt is born of the Bank
of England. That bank was chartered in 1694, and was nothing
more nor less in the beginning, than an act of Parliament for
the incorporation of a company of subscribers to a government
loan. The loan was £1,200,000; the interest £80,000; and the
expenses of management £4,000. And this is the birth and origin,
the germ and nucleus of that debt, which is now £900,000,000
(the unfunded items included), which bears an interest of
£30,000,000, and costs £260,000 for annual management.
"4. It tends to beget and prolong unnecessary wars, by
furnishing the means of carrying them on without recurrence to
the people. England is the ready example for this calamity. Her
wars for the restoration of the Capet Bourbons were kept up by
loans and subsidies created out of bank paper. The people of
England had no interest in these wars, which cost them about
£600,000,000 of debt in twenty-five years, in addition to the
supplies raised within the year. The kings she put back upon the
French throne were not able to sit on it. Twice she put them
on; twice they tumbled off in the mud; and all that now remains
of so much sacrifice of life and money is, the debt, which is
eternal, the taxes, which are intolerable, the pensions and
titles of some warriors, and the keeping of the Capet Bourbons,
who are returned upon their hands.
"5. It tends to aggravate the inequality of fortunes; to make
the rich richer, and the poor poorer; to multiply nabobs and
paupers; and to deepen and widen the gulf which separates Dives
from Lazarus. A great moneyed power is favorable to great
capitalists; for it is the principle of money to favor money. It
is unfavorable to small capitalists; for it is the principle of
money to eschew the needy and unfortunate. It is injurious to
the laboring classes; because they receive no favors, and have
the price of the property they wish to acquire raised to the
paper maximum, while wages remain at the silver minimum.
"6. It tends to make and to break fortunes, by the flux and
reflux of paper. Profuse issues, and sudden contractions,
perform this operation, which can be repeated, like planetary
and pestilential visitations, in every cycle of so many years;
at every periodical return, transferring millions from the
actual possessors of property to the Neptunes who preside over
the flux and reflux of paper. The last operation of this kind
performed by the Bank of England, about five years ago, was
described by Mr. Alexander Baring, in the House of Commons, in
terms which are entitled to the knowledge and remembrance of
American citizens. I will read his description, which is brief,
but impressive. After describing the profuse issues of 1823-24,
he painted the reaction in the following terms:
"'They, therefore, all at once, gave a sudden jerk to the
horse on whose neck they had before suffered the reins to hang
loose. They contracted their issues to a considerable extent.
The change was at once felt throughout the country. A few days
before that, no one knew what to do with his money; now, no
one knew where to get it. * * * * The London bankers found
it necessary to follow the same course towards their country
correspondents, and these again towards their customers, and
each individual towards his debtor. The consequence was obvious
in the late panic. Every one, desirous to obtain what was due to
him, ran to his banker, or to any other on whom he had a claim;
and even those who had no immediate use for their money, took
it back, and let it lie unemployed in their pockets, thinking
it unsafe in others' hands. The effect of this alarm was, that
houses which were weak went immediately. Then went second rate
houses; and, lastly, houses which were solvent went, because
their securities were unavailable. The daily calls to which
each individual was subject put it out of his power to assist
his neighbor. Men were known to seek for assistance, and that,
too, without finding it, who, on examination of their affairs,
were proved to be worth 200,000 pounds,--men, too, who held
themselves so secure, that, if asked six months before whether
they could contemplate such an event, they would have said it
would be impossible, unless the sky should fall, or some other
event equally improbable should occur.'
"This is what was done in England five years ago, it is what may
be done here in every five years to come, if the bank charter is
renewed. Sole dispenser of money, it cannot omit the oldest and
most obvious means of amassing wealth by the flux and reflux of
paper. The game will be in its own hands, and the only answer
to be given is that to which I have alluded: 'The Sultan is too
just and merciful to abuse his power.'
"_Thirdly._ I object to the renewal of the charter, on account
of the exclusive privileges, and anti-republican monopoly, which
it gives to the stockholders. It gives, and that by an act of
Congress, to a company of individuals, the exclusive legal
privileges:
"1. To carry on the trade of banking upon the revenue and
credit, and in the name, of the United States of America.
"2. To pay the revenues of the Union in their own promissory
notes.
"3. To hold the moneys of the United States in deposit, without
making compensation for the undrawn balances.
"4. To discredit and disparage the notes of other banks, by
excluding them from the collection of the federal revenue.
"5. To hold real estate, receive rents, and retain a body of
tenantry.
"6. To deal in pawns, merchandise, and bills of exchange.
"7. To establish branches in the States without their consent.
"8. To be exempt from liability on the failure of the bank.
"9. To have the United States for a partner.
"10. To have foreigners for partners.
"11. To be exempt from the regular administration of justice for
the violations of their charter.
"12. To have all these exclusive privileges secured to them as a
monopoly, in a pledge of the public faith not to grant the like
privileges to any other company.
"These are the privileges, and this the monopoly of the bank.
Now, let us examine them, and ascertain their effect and
bearing. Let us contemplate the magnitude of the power which
they create; and ascertain the compatibility of this power with
the safety of this republican government, and the rights and
interests of its free and equal constituents.
"1. The name, the credit, and the revenues of the United States
are given up to the use of this company, and constitute in
themselves an immense capital to bank upon. The name of the
United States, like that of the King, is a tower of strength;
and this strong tower is now an outwork to defend the citadel of
a moneyed corporation. The credit of the Union is incalculable;
and, of this credit, as going with the name, and being in
partnership with the United States, the same corporation now has
possession. The revenues of the Union are twenty-six millions
of dollars, including the post-office; and all this is so
much capital in the hands of the bank, because the revenue is
received by it, and is payable in its promissory notes.
"2. To pay the revenues of the United States in their own
notes, until Congress, by law, shall otherwise direct. This is
a part of the charter, incredible and extraordinary as it may
appear. The promissory notes of the bank are to be received in
payment of every thing the United States may have to sell--in
discharge of every debt due to her, until Congress, by law,
shall otherwise direct; so that, if this bank, like its
prototype in England, should stop payment, its promissory notes
would still be receivable at every custom-house, land-office,
post-office, and by every collector of public moneys, throughout
the Union, until Congress shall meet, pass a repealing law, and
promulgate the repeal. Other banks depend upon their credit for
the receivability of their notes; but this favored institution
has law on its side, and a chartered right to compel the
reception of its paper by the federal government. The immediate
consequence of this extraordinary privilege is, that the United
States becomes virtually bound to stand security for the bank,
as much so as if she had signed a bond to that effect; and must
stand forward to sustain the institution in all emergencies,
in order to save her own revenue. This is what has already
happened, some ten years ago, in the early progress of the bank,
and when the immense aid given it by the federal government
enabled it to survive the crisis of its own overwhelming
mismanagement.
"3. To hold the moneys of the United States in deposit, without
making compensation for the use of the undrawn balances.--This
is a right which I deny; but, as the bank claims it, and, what
is more material, enjoys it; and as the people of the United
States have suffered to a vast extent in consequence of this
claim and enjoyment, I shall not hesitate to set it down to
the account of the bank. Let us then examine the value of this
privilege, and its effect upon the interest of the community;
and, in the first place, let us have a full and accurate view of
the amount of these undrawn balances, from the establishment of
the bank to the present day. Here it is! Look! Read!
"See, Mr. President, what masses of money, and always on hand.
The paper is covered all over with millions: and yet, for all
these vast sums, no interest is allowed; no compensation is
made to the United States. The Bank of England, for the undrawn
balances of the public money, has made an equitable compensation
to the British government; namely, a permanent loan of half a
million sterling, and a temporary loan of three millions for
twenty years, without interest. Yet, when I moved for a like
compensation to the United States, the proposition was utterly
rejected by the Finance Committee, and treated as an attempt
to violate the charter of the bank. At the same time it is
incontestable, that the United States have been borrowing these
undrawn balances from the bank, and paying an interest upon
their own money. I think we can identify one of these loans.
Let us try. In May, 1824, Congress authorized a loan of five
millions of dollars to pay the awards under the treaty with
Spain, commonly called the Florida treaty. The bank of the
United States took that loan, and paid the money for the United
States in January and March, 1825. In looking over the statement
of undrawn balances, it will be seen that they amounted to near
four millions at the end of the first, and six millions at
the end of the second quarter of that year. The inference is
irresistible, and I leave every senator to make it; only adding,
that we have paid $1,469,375 in interest upon that loan, either
to the bank or its transferrees. This is a strong case; but I
have a stronger one. It is known to every body, that the United
States subscribed seven millions to the capital stock of the
bank, for which she gave her stock note, bearing an interest of
five per cent. per annum. I have a statement from the Register
of the Treasury, from which it appears that, up to the 30th day
of June last, the United States had paid four millions seven
hundred and twenty-five thousand dollars in interest upon that
note; when it is proved by the statement of balances exhibited,
that the United States, for the whole period in which that
interest was accruing, had the half, or the whole, and once the
double, of these seven millions in the hands of the bank. This
is a stronger case than that of the five million loan, but it
is not the strongest. The strongest case is this: in the year
1817, when the bank went into operation, the United States
owed, among other debts, a sum of about fourteen millions and
three-quarters, bearing an interest of three per cent. In the
same year, the commissioners of the sinking fund were authorized
by an act of Congress to purchase that stock at sixty-five per
cent., which was then its market price. Under this authority,
the amount of about one million and a half was purchased; the
remainder, amounting to about thirteen millions and a quarter,
has continued unpurchased to this day; and, after costing the
United States about six millions in interest since 1817, the
stock has risen about four millions in value; that is to say,
from sixty-five to nearly ninety-five. Now, here is a clear loss
of ten millions of dollars to the United States. In 1817 she
could have paid off thirteen millions and a quarter of debt,
with eight millions and a half of dollars: now, after paying
six millions of interest, it would require twelve millions and
a half to pay off the same debt. By referring to the statement
of undrawn balances, it will be seen that the United States had,
during the whole year 1817, an average sum of above ten millions
of dollars in the hands of the bank, being a million and a half
more than enough to have bought in the whole of the three per
cent. stock. The question, therefore, naturally comes up, why
was it not applied to the redemption of these thirteen millions
and a quarter, according to the authority contained in the act
of Congress of that year? Certainly the bank needed the money;
for it was just getting into operation, and was as hard run to
escape bankruptcy about that time, as any bank that ever was
saved from the brink of destruction. This is the largest injury
which we have sustained, on account of accommodating the bank
with the gratuitous use of these vast deposits. But, to show
myself impartial, I will now state the smallest case of injury
that has come within my knowledge: it is the case of the _bonus_
of fifteen hundred thousand dollars which the bank was to pay to
the United States, in three equal instalments, for the purchase
of its charter. Nominally, this _bonus_ has been paid, but out
of what moneys? Certainly out of our own; for the statement
shows our money was there, and further, shows that it is still
there; for, on the 30th day of June last, which is the latest
return, there was still $2,550,664 in the hands of the bank,
which is above $750,000 more than the amount of the _bonus_.
"One word more upon the subject of these balances. It is now two
years since I made an effort to repeal the 4th section of the
Sinking Fund act of 1817; a section which was intended to limit
the amount of surplus money which might be kept in the treasury,
to two millions of dollars; but, by the power of construction,
was made to authorize the keeping of two millions in addition
to the surplus. I wished to repeal this section, which had
thus been construed into the reverse of its intention, and to
revive the first section of the Sinking Fund act of 1790, which
directed the whole of the surplus on hand to be applied, at the
end of each year, to the payment of the public debt. My argument
was this: that there was no necessity to keep any surplus;
that the revenue, coming in as fast as it went out, was like a
perennial fountain, which you might drain to the last drop, and
not exhaust; for the place of the last drop would be supplied
the instant it was out. And I supported this reasoning by a
reference to the annual treasury reports, which always exhibit
a surplus of four or five millions; and which were equally in
the treasury the whole year round, as on the last day of every
year. This was the argument, which in fact availed nothing;
but now I have mathematical proof of the truth of my position.
Look at this statement of balances; look for the year 1819,
and you will find but three hundred thousand dollars on hand
for that year; look still lower for 1821, and you will find
this balance but one hundred and eighty-two thousand dollars.
And what was the consequence? Did the Government stop? Did the
wheels of the State chariot cease to turn round in those years
for want of treasury oil? Not at all. Every thing went on as
well as before; the operations of the treasury were as perfect
and regular in those two years of insignificant balances, as in
1817 and 1818, when five and ten millions were on hand. This is
proof; this is demonstration; it is the indubitable evidence of
the senses which concludes argument, and dispels uncertainty;
and, as my proposal for the repeal of the 4th Section of the
Sinking Fund act of 1817 was enacted into a law at the last
session of Congress, upon the recommendation of the Secretary
of the Treasury, a vigilant and exemplary officer, I trust that
the repeal will be acted upon, and that the bank platter will be
wiped as clean of federal money in 1831, as it was in 1821. Such
clean-taking from that dish will allow two or three millions
more to go to the reduction of the public debt; and there can be
no danger in taking the last dollar, as reason and experience
both prove. But, to quiet every apprehension on this point, to
silence the last suggestion of a possibility of any temporary
deficit, I recur to a provision contained in two different
clauses in the bank charter, copied from an amendment in the
charter of the Bank of England, and expressly made, at the
instance of the ministry, to meet the contingency of a temporary
deficiency in the annual revenue. The English provision is
this: that the government may borrow of the bank half a million
sterling, at any time, without a special act of parliament to
authorize it. The provision in our charter is the same, with the
single substitution of dollars for pounds. It is, in words and
intention, a standing authority to borrow that limited sum, for
the obvious purpose of preventing a constant keeping of a sum of
money in hand as a reserve, to meet contingencies which hardly
ever occur. This contingent authority to effect a small loan
has often been used in England--in the United States, never;
possibly, because there has been no occasion for it; probably,
because the clause was copied mechanically from the English
charter, and without the perception of its practical bearing. Be
this as it may, it is certainly a wise and prudent provision,
such as all governments should, at all times be clothed with.
"If any senator thinks that I have exaggerated the injury
suffered by the United States, on account of the uncompensated
masses of public money in the hands of the bank, I am now going
to convince him that he is wrong. I am going to prove to him
that I have understated the case; that I have purposely kept
back a large part of it; and that justice requires a further
development. The fact is, that there are two different deposits
of public money in the bank; one in the name of the Treasurer of
the United States, the other in the name of disbursing officers.
The annual average of the former has been about three and a half
millions of dollars, and of this I have said not a word. But
the essential character of both deposits is the same; they are
both the property of the United States; both permanent; both
available as so much capital to the bank; and both uncompensated.
"I have not ascertained the average of these deposits since
1817, but presume it may equal the amount of that _bonus_ of
one million five hundred thousand dollars for which we sold
the charter, and which the Finance Committee of the Senate
compliments the bank for paying in three, instead of seventeen,
annual instalments; and shows how much interest they lost by
doing so. Certainly, this was a disadvantage to the bank.
"Mr. President, it does seem to me that there is something
ominous to the bank in this contest for compensation on the
undrawn balances. It is the very way in which the struggle began
in the British Parliament which has ended in the overthrow of
the Bank of England. It is the way in which the struggle is
beginning here. My resolutions of two and three years ago are
the causes of the speech which you now hear; and, as I have
reason to believe, some others more worthy of your hearing,
which will come at the proper time. The question of compensation
for balances is now mixing itself up here, as in England, with
the question of renewing the charter; and the two, acting
together, will fall with combined weight upon the public mind,
and certainly eventuate here as they did there.
"4. To discredit and disparage the notes of all other banks, by
excluding them from the collection of the federal revenue. This
results from the collection--no, not the collection, but the
receipt of the revenue having been communicated to the bank,
and along with it the virtual execution of the joint resolution
of 1816, to regulate the collection of the federal revenue.
The execution of that resolution was intended to be vested in
the Secretary of the Treasury--a disinterested arbiter between
rival banks; but it may be considered as virtually devolved upon
the Bank of the United States, and powerfully increases the
capacity of that institution to destroy, or subjugate, all other
banks. This power to disparage the notes of all other banks, is
a power to injure them; and, added to all the other privileges
of the Bank of the United States, is a power to destroy them!
If any one doubts this assertion, let him read the answers of
the president of the bank to the questions put to him by the
chairman of the Finance Committee. These answers are appended
to the committee's report of the last session in favor of the
bank, and expressly declare the capacity of the federal bank to
destroy the State banks. The worthy chairman [Mr. Smith, of Md.]
puts this question; 'Has the bank at any time oppressed any of
the State banks.' The president [Mr. Biddle] answers, as the
whole world would answer to a question of oppression, that it
never had; and this response was as much as the interrogatory
required. But it did not content the president of the bank; he
chose to go further, and to do honor to the institution over
which he presided, by showing that it was as just and generous
as it was rich and powerful. He, therefore, adds the following
words, for which, as a seeker after evidence, to show the
alarming and dangerous character of the bank, I return him my
unfeigned thanks: 'There are very few banks which might not have
been destroyed by an exertion of the power of the bank.'
"This is enough! proof enough! not for me alone, but for all
who are unwilling to see a moneyed domination set up--a moneyed
oligarchy established in this land, and the entire Union
subjected to its sovereign will. The power to destroy all other
banks is admitted and declared; the inclination to do so is
known to all rational beings to reside with the power! Policy
may restrain the destroying faculties for the present; but they
exist; and will come forth when interest prompts and policy
permits. They have been exercised; and the general prostration
of the Southern and Western banks attest the fact. They will be
exercised (the charter being renewed), and the remaining State
banks will be swept with the besom of destruction. Not that all
will have their signs knocked down, and their doers closed up.
Far worse than that to many of them. Subjugation, in preference
to destruction, will be the fate of many. Every planet must
have its satellites; every tyranny must have its instruments;
every knight is followed by his squire; even the king of beasts,
the royal quadruped, whose roar subdues the forest, must have
a small, subservient animal to spring his prey. Just so of
this imperial bank, when installed anew in its formidable and
lasting power. The State banks, spared by the sword, will be
passed under the yoke. They will become subordinate parts in the
great machine. Their place in the scale of subordination will
be one degree below the rank of the legitimate branches; their
business, to perform the work which it would be too disreputable
for the legitimate branches to perform. This will be the fate of
the State banks which are allowed to keep up their signs, and to
set open their doors; and thus the entire moneyed power of the
Union would fall into the hands of one single institution, whose
inexorable and invisible mandates, emanating from a centre,
would pervade the Union, giving or withholding money according
to its own sovereign will and absolute pleasure. To a favored
State, to an individual, or a class of individuals, favored
by the central power, the golden stream of Pactolus would
flow direct. To all such the munificent mandates of the High
Directory would come, as the fabled god made his terrestrial
visit of love and desire, enveloped in a shower of gold. But to
others--to those not favored--and to those hated--the mandates
of this same directory would be as 'the planetary plague which
hangs its poison in the sick air;' death to them! death to all
who minister to their wants! What a state of things! What a
condition for a confederacy of States! What grounds for alarm
and terrible apprehension, when in a confederacy of such vast
extent, so many independent States, so many rival commercial
cities, so much sectional jealousy, such violent political
parties, such fierce contests for power, there should be but
one moneyed tribunal, before which all the rival and contending
elements must appear! but one single dispenser of money, to
which every citizen, every trader, every merchant, every
manufacturer, every planter, every corporation, every city,
every State, and the federal government itself, must apply, in
every emergency, for the most indispensable loan! and this, in
the face of the fact, that, in every contest for human rights,
the great moneyed institutions of the world have uniformly been
found on the side of kings and nobles, against the lives and
liberties of the people;
"5. To hold real estate, receive rents, and retain a body
of tenantry. This privilege is hostile to the nature of our
republican government, and inconsistent with the nature and
design of a banking institution. Republics want freeholders,
not landlords and tenants; and, except the corporators in this
bank, and in the British East India Company, there is not an
incorporated body of landlords in any country upon the face
of the earth whose laws emanate from a legislative body. Banks
are instituted to promote trade and industry, and to aid the
government and its citizens with loans of money. The whole
argument in favor of banking--every argument in favor of this
bank--rests upon that idea. No one, when this charter was
granted, presumed to speak in favor of incorporating a society
of landlords, especially foreign landlords, to buy lands, build
houses, rent tenements, and retain tenantry. Loans of money
was the object in view, and the purchase of real estate is
incompatible with that object. Instead of remaining bankers,
the corporators may turn land speculators: instead of having
money to lend, they may turn you out tenants to vote. To an
application for a loan, they may answer, and answer truly, that
they have no money on hand; and the reason may be, that they
have laid it out in land. This seems to be the case at present.
A committee of the legislature of Pennsylvania has just applied
for a loan; the president of the bank, nothing loth to make
a loan to that great State, for twenty years longer than the
charter has to exist, expresses his regret that he cannot lend
but a limited and inadequate sum. The funds of the institution,
he says, will not permit it to advance more than eight millions
of dollars. And why? because it has invested three millions in
real estate! To this power to hold real estate, is superadded
the means to acquire it. The bank is now the greatest moneyed
power in the Union; in the event of the renewal of its charter,
it will soon be the sole one. Sole dispenser of money, it
will soon be the chief owner of property. To unlimited means
of acquisition, would be united perpetuity of tenure; for a
corporation never dies, and is free from the operation of the
laws which govern the descent and distribution of real estate
in the hands of individuals. The limitations in the charter are
vain and illusory. They insult the understanding, and mock the
credulity of foolish believers. The bank is first limited to
such acquisitions of real estate as are necessary to its own
accommodation; then comes a proviso to undo the limitation,
so far as it concerns purchases upon its own mortgages and
executions! This is the limitation upon the capacity of such an
institution to acquire real estate. As if it had any thing to
do but to make loans upon mortgages, and push executions upon
judgments! Having all the money, it would be the sole lender;
mortgages being the road to loans, all borrowers must travel
that road. When birds enough are in the net, the fowler draws
his string, and the heads are wrung off. So when mortgages
enough are taken, the loans are called in; discounts cease;
curtailments are made; failures to pay ensue; writs issue;
judgments and executions follow; all the mortgaged premises are
for sale at once; and the attorney of the bank appears at the
elbow of the marshal, sole bidder and sole purchaser.
"What is the legal effect of this vast capacity to acquire, and
this legal power to retain, real estate? Is it not the creation
of a new species of mortmain? And of a kind more odious and
dangerous than that mortmain of the church which it baffled the
English Parliament so many ages to abolish. The mortmain of the
church was a power in an ecclesiastical corporation to hold real
estate, independent of the laws of distribution and descent:
the mortmain of the bank is a power in a lay corporation to do
the same thing. The evil of the two tenures is identical; the
difference between the two corporations is no more than the
difference between parsons and money-changers; the capacity to
do mischief incomparably the greatest on the part of the lay
corporators. The church could only operate upon the few who
were thinking of the other world; the bank, upon all who are
immersed in the business or the pleasures of this. The means
of the church were nothing but prayers; the means of the bank
is money! The church received what it could beg from dying
sinners; the bank may extort what it pleases from the whole
living generation of the just and unjust. Such is the parallel
between the mortmain of the two corporations. They both end in
monopoly of estates and perpetuity of succession; and the bank
is the greatest monopolizer of the two. Monopolies and perpetual
succession are the bane of republics. Our ancestors took care to
provide against them, by abolishing entails and primogeniture.
Even the glebes of the church, lean and few as they were in
most of the States, fell under the republican principle of
limited tenures. All the States abolished the anti-republican
tenures; but Congress re-establishes them, and in a manner more
dangerous and offensive than before the Revolution. They are
now given, not generally, but to few; not to natives only, but
to foreigners also; for foreigners are large owners of this
bank. And thus, the principles of the Revolution sink before the
privileges of an incorporated company. The laws of the States
fall before the mandates of a central directory in Philadelphia.
Foreigners become the landlords of free-born Americans; and the
young and flourishing towns of the United States are verging
to the fate of the family boroughs which belong to the great
aristocracy of England.
"Let no one say the bank will not avail itself of its capacity
to amass real estate. The fact is, it has already done so. I
know towns, yea, cities, and could name them, if it might not
seem invidious from this elevated theatre to make a public
reference to their misfortunes, in which this bank already
appears as a dominant and engrossing proprietor. I have been in
places where the answers to inquiries for the owners of the most
valuable tenements, would remind you of the answers given by
the Egyptians to similar questions from the French officers, on
their march to Cairo. You recollect, no doubt, sir, the dialogue
to which I allude: 'Who owns that palace?' 'The Mameluke;' 'Who
this country house?' 'The Mameluke;' 'These gardens?' 'The
Mameluke;' 'That field covered with rice?' 'The Mameluke.'--And
thus have I been answered, in the towns and cities referred to,
with the single exception of the name of the Bank of the United
States substituted for that of the military scourge of Egypt. If
this is done under the first charter, what may not be expected
under the second? If this is done while the bank is on its best
behavior, what may she not do when freed from all restraint and
delivered up to the boundless cupidity and remorseless exactions
of a moneyed corporation?
"6. To deal in pawns, merchandise, and bills of exchange. I
hope the Senate will not require me to read dry passages from
the charter to prove what I say. I know I speak a thing nearly
incredible when I allege that this bank, in addition to all its
other attributes, is an incorporated company of pawnbrokers! The
allegation staggers belief, but a reference to the charter will
dispel incredulity. The charter, in the first part, forbids a
traffic in merchandise; in the after part, permits it. For truly
this instrument seems to have been framed upon the principles
of contraries; one principle making limitations, and the other
following after with provisos to undo them. Thus is it with
lands, as I have just shown; thus is it with merchandise, as I
now show. The bank is forbidden to deal in merchandise--proviso,
unless in the case of goods pledged for money lent, and not
redeemed to the day; and, proviso, again, unless for goods
which shall be the proceeds of its lands. With the help of
these two provisos, it is clear that the limitation is undone;
it is clear that the bank is at liberty to act the pawnbroker
and merchant, to any extent that it pleases. It may say to all
the merchants who want loans, Pledge your stores, gentlemen!
They must do it, or do worse; and, if any accident prevents
redemption on the day, the pawn is forfeited, and the bank takes
possession. On the other hand, it may lay out its rents for
goods; it may sell its real estate, now worth three millions of
dollars, for goods. Thus the bank is an incorporated company
of pawnbrokers and merchants, as well as an incorporation of
landlords and land-speculators; and this derogatory privilege,
like the others, is copied from the old Bank of England charter
of 1694. Bills of exchange are also subjected to the traffic
of this bank. It is a traffic unconnected with the trade of
banking, dangerous for a great bank to hold, and now operating
most injuriously in the South and West. It is the process which
drains these quarters of the Union of their gold and silver,
and stifles the growth of a fair commerce in the products of
the country. The merchants, to make remittances, buy bills of
exchange from the branch banks, instead of buying produce from
the farmers. The bills are paid for in gold and silver; and,
eventually, the gold and silver are sent to the mother bank,
or to the branches in the Eastern cities, either to meet these
bills, or to replenish their coffers, and to furnish vast
loans to favorite States or individuals. The bills sell cheap,
say a fraction of one per cent.; they are, therefore, a good
remittance to the merchant. To the bank the operation is doubly
good; for even the half of one per cent. on bills of exchange
is a great profit to the institution which monopolizes that
business, while the collection and delivery to the branches of
all the hard money in the country is a still more considerable
advantage. Under this system, the best of the Western banks--I
do not speak of those which had no foundations, and sunk under
the weight of neighborhood opinion, but those which deserved
favor and confidence--sunk ten years ago. Under this system,
the entire West is now undergoing a silent, general, and
invisible drain of its hard money; and, if not quickly arrested,
these States will soon be, so far as the precious metals are
concerned, no more than the empty skin of an immolated victim.
"7. To establish branches in the different States without
their consent, and in defiance of their resistance. No one can
deny the degrading and injurious tendency of this privilege.
It derogates from the sovereignty of a State; tramples upon
her laws; injures her revenue and commerce; lays open her
government to the attacks of centralism; impairs the property
of her citizens; and fastens a vampire on her bosom to suck
out her gold and silver. 1. It derogates from her sovereignty,
because the central institution may impose its intrusive
branches upon the State without her consent, and in defiance
of her resistance. This has already been done. The State of
Alabama, but four years ago, by a resolve of her legislature,
remonstrated against the intrusion of a branch upon her.
She protested against the favor. Was the will of the State
respected? On the contrary, was not a branch instantaneously
forced upon her, as if, by the suddenness of the action, to
make a striking and conspicuous display of the omnipotence of
the bank, and the nullity of the State? 2. It tramples upon
her laws; because, according to the decision of the Supreme
Court, the bank and all its branches are wholly independent
of State legislation; and it tramples on them again, because
it authorizes foreigners to hold lands and tenements in every
State, contrary to the laws of many of them; and because it
admits of the _mortmain_ tenure, which is condemned by all the
republican States in the Union. 3. It injures her revenue,
because the bank stock, under the decision of the Supreme
Court, is not liable to taxation. And thus, foreigners, and
non-resident Americans, who monopolize the money of the State,
who hold its best lands and town lots, who meddle in its
elections, and suck out its gold and silver, and perform no
military duty, are exempted from paying taxes, in proportion
to their wealth, for the support of the State whose laws they
trample upon, and whose benefits they usurp. 4. It subjects the
State to the dangerous manoeuvres and intrigues of centralism,
by means of the tenants, debtors, bank officers, and bank
money, which the central directory retain in the State, and
may embody and direct against it in its elections, and in its
legislative and judicial proceedings. 5. It tends to impair
the property of the citizens, and, in some instances, that of
the States, by destroying the State banks in which they have
invested their money. 6. It is injurious to the commerce of
the States (I speak of the Western States), by substituting a
trade in bills of exchange, for a trade in the products of the
country. 7. It fastens a vampire on the bosom of the State,
to suck away its gold and silver, and to co-operate with the
course of trade, of federal legislation, and of exchange,
in draining the South and West of all their hard money. The
Southern States, with their thirty millions of annual exports in
cotton, rice, and tobacco, and the Western States, with their
twelve millions of provisions and tobacco exported from New
Orleans, and five millions consumed in the South, and on the
lower Mississippi,--that is to say, with three fifths of the
marketable productions of the Union, are not able to sustain
thirty specie paying banks; while the minority of the States
north of the Potomac, without any of the great staples for
export, have above four hundred of such banks. These States,
without rice, without cotton, without tobacco, without sugar,
and with less flour and provisions, to export, are saturated
with gold and silver; while the Southern and Western States,
with all the real sources of wealth, are in a state of the
utmost destitution. For this calamitous reversal of the natural
order of things, the Bank of the United States stands forth
pre-eminently culpable. Yes, it is pre-eminently culpable! and
a statement in the 'National Intelligencer' of this morning
(a paper which would overstate no fact to the prejudice of
the bank), cites and proclaims the fact which proves this
culpability. It dwells, and exults, on the quantity of gold and
silver in the vaults of the United States Bank. It declares
that institution to be 'overburdened' with gold and silver; and
well may it be so overburdened, since it has lifted the load
entirely from the South and West. It calls these metals 'a drug'
in the hands of the bank; that is to say, an article for which
no purchaser can be found. Let this 'drug,' like the treasures
of the dethroned Dey of Algiers, be released from the dominion
of its keeper; let a part go back to the South and West, and the
bank will no longer complain of repletion, nor they of depletion.
"8. Exemption of the stockholders from individual liability
on the failure of the bank. This privilege derogates from the
common law, is contrary to the principle of partnerships, and
injurious to the rights of the community. It is a peculiar
privilege granted by law to these corporators, and exempting
them from liability, except in their corporate capacity, and to
the amount of the assets of the corporation. Unhappily these
assets are never _assez_, that is to say, enough, when occasion
comes for recurring to them. When a bank fails, its assets are
always less than its debts; so that responsibility fails the
instant that liability accrues. Let no one say that the bank of
the United States is too great to fail. One greater than it,
and its prototype, has failed, and that in our own day, and for
twenty years at a time: the Bank of England failed in 1797,
and the Bank of the United States was on the point of failing
in 1819. The same cause, namely, stockjobbing and overtrading,
carried both to the brink of destruction; the same means saved
both, namely, the name, the credit, and the helping hand of
the governments which protected them. Yes, the Bank of the
United States may fail; and its stockholders live in splendor
upon the princely estates acquired with its notes, while the
industrious classes, who hold these notes, will be unable to
receive a shilling for them. This is unjust. It is a vice in the
charter. The true principle in banking requires each stockholder
to be liable to the amount of his shares; and subjects him
to the summary action of every holder on the failure of the
institution, till he has paid up the amount of his subscription.
This is the true principle. It has prevailed in Scotland for the
last century, and no such thing as a broken bank has been known
there in all that time.
"9. To have the United States for a partner. Sir, there is one
consequence, one result of all partnerships between a government
and individuals, which should of itself, and in a mere
mercantile point of view, condemn this association on the part
of the federal government. It is the principle which puts the
strong partner forward to bear the burden whenever the concern
is in danger. The weaker members flock to the strong partner at
the approach of the storm, and the necessity of venturing more
to save what he has already staked, leaves him no alternative.
He becomes the Atlas of the firm, and bears all upon his own
shoulders. This is the principle: what is the fact? Why, that
the United States has already been compelled to sustain the
federal bank; to prop it with her revenues and its credit in
the trials and crisis of its early administration. I pass over
other instances of the damage suffered by the United States on
account of this partnership; the immense standing deposits for
which we receive no compensation; the loan of five millions of
our own money, for which we have paid a million and a half in
interest; the five per cent. stock note, on which we have paid
our partners four million seven hundred and twenty-five thousand
dollars in interest; the loss of ten millions on the three per
cent. stock, and the ridiculous catastrophe of the miserable
_bonus_, which has been paid to us with a fraction of our own
money: I pass over all this, and come to the point of a direct
loss, as a partner, in the dividends upon the stock itself.
Upon this naked point of profit and loss, to be decided by a
rule in arithmetic, we have sustained a direct and heavy loss.
The stock held by the United States, as every body knows, was
subscribed, not paid. It was a stock note, deposited for seven
millions of dollars, bearing an interest of five per cent. The
inducement to this subscription was the seductive conception
that, by paying five per cent. on its note, the United States
would clear four or five per cent. in getting a dividend of
eight or ten. This was the inducement; now for the realization
of this fine conception. Let us see it. Here it is; an official
return, from the Register of the Treasury of interest paid, and
of dividends received. The account stands thus:
Interest paid by the United States, $4,725,000
Dividends received by the United States, 4,629,426
----------
Loss to the United States, $95,574
"Disadvantageous as this partnership must be to the United
States in a moneyed point of view, there is a far more grave
and serious aspect under which to view it. It is the political
aspect, resulting from the union between the bank and the
government. This union has been tried in England, and has been
found there to be just as disastrous a conjunction as the
union between church and state. It is the conjunction of the
lender and the borrower, and Holy Writ has told us which of
these categories will be master of the other. But suppose they
agree to drop rivalry, and unite their resources. Suppose they
combine, and make a push for political power: how great is the
mischief which they may not accomplish! But, on this head,
I wish to use the language of one of the brightest patriots
of Great Britain; one who has shown himself, in these modern
days, to be the worthy successor of those old iron barons whose
patriotism commanded the unpurchasable eulogium of the elder
Pitt. I speak of Sir William Pulteney, and his speech against
the Bank of England, in 1797.
"THE SPEECH:--EXTRACT.
"'I have said enough to show that government has been rendered
dependent on the bank, and more particularly so in the time of
war; and though the bank has not yet fallen into the hands of
ambitious men, yet it is evident that it might, in such hands,
assume a power sufficient to control and overawe, not only the
ministers, but king, lords, and commons. * * * * * * As the bank
has thus become dangerous to government, it might, on the other
hand, by uniting with an ambitious minister, become the means of
establishing a fourth estate, sufficient to involve this nation
in irretrievable slavery, and ought, therefore, to be dreaded
as much as a certain East India bill was justly dreaded, at a
period not very remote. I will not say that the present minister
(the younger Pitt), by endeavoring, at this crisis, to take the
Bank of England under his protection, can have any view to make
use, hereafter, of that engine to perpetuate his own power, and
to enable him to domineer over our constitution: if that could
be supposed, it would only show that men can entertain a very
different train of ideas, when endeavoring to overset a rival,
from what occurs to them when intending to support and fix
themselves. My object is to secure the country against all risk
either from the bank as opposed to government, or as the engine
of ambitious men.'
"And this is my object also. I wish to secure the Union from all
chance of harm from this bank. I wish to provide against its
friendship, as well as its enmity--against all danger from its
hug, as well as from its blow. I wish to provide against all
risk, and every hazard; for, if this risk and hazard were too
great to be encountered by King, Lords, and Commons, in Great
Britain, they must certainly be too great to be encountered by
the people of the United States, who are but commons alone.
"10. To have foreigners for partners. This, Mr. President,
will be a strange story to be told in the West. The downright
and upright people of that unsophisticated region believe that
words mean what they signify, and that 'the Bank of the United
States' is the Bank of the United States. How great then must
be their astonishment to learn that this belief is a false
conception, and that this bank (its whole name to the contrary
notwithstanding) is just as much the bank of foreigners as
it is of the federal government. Here I would like to have
the proof--a list of the names and nations, to establish this
almost incredible fact. But I have no access except to public
documents, and from one of these I learn as much as will answer
the present pinch. It is the report of the Committee of Ways and
Means, in the House of Representatives, for the last session of
Congress. That report admits that foreigners own seven millions
of the stock of this bank; and every body knows that the federal
government owns seven millions also.
"Thus it is proved that foreigners are as deeply interested in
this bank as the United States itself. In the event of a renewal
of the charter they will be much more deeply interested than at
present; for a prospect of a rise in the stock to two hundred
and fifty, and the unsettled state of things in Europe, will
induce them to make great investments. It is to no purpose to
say that the foreign stockholders cannot be voters or directors.
The answer to that suggestion is this: the foreigners have the
money; they pay down the cash, and want no accommodations; they
are lenders, not borrowers; and in a great moneyed institution,
such stockholders must have the greatest influence. The name
of this bank is a deception upon the public. It is not the
bank of the federal government, as its name would import, nor
of the States which compose this Union; but chiefly of private
individuals, foreigners as well as natives, denizens, and
naturalized subjects. They own twenty-eight millions of the
stock, the federal government but seven millions, and these
seven are precisely balanced by the stock of the aliens. The
federal government and the aliens are equal, owning one fifth
each; and there would be as much truth in calling it the English
Bank as the Bank of the United States. Now mark a few of the
privileges which this charter gives to these foreigners. To be
landholders, in defiance of the State laws, which forbid aliens
to hold land; to be landlords by incorporation, and to hold
American citizens for tenants; to hold lands in mortmain; to be
pawnbrokers and merchants by incorporation; to pay the revenue
of the United States in their own notes; in short, to do every
thing which I have endeavored to point out in the long and
hideous list of exclusive privileges granted to this bank. If
I have shown it to be dangerous for the United States to be in
partnership with its own citizens, how much stronger is not the
argument against a partnership with foreigners? What a prospect
for loans when at war with a foreign power, and the subjects of
that power large owners of the bank here, from which alone, or
from banks liable to be destroyed by it, we can obtain money to
carry on the war! What a state of things, if, in the division
of political parties, one of these parties and the foreigners,
coalescing, should have the exclusive control of all the money
in the Union, and, in addition to the money, should have bodies
of debtors, tenants, and bank officers stationed in all the
States, with a supreme and irresponsible system of centralism to
direct the whole! Dangers from such contingencies are too great
and obvious to be insisted upon. They strike the common sense
of all mankind, and were powerful considerations with the old
whig republicans for the non-renewal of the charter of 1791.
Mr. Jefferson and the whig republicans staked their political
existence on the non-renewal of that charter. They succeeded;
and, by succeeding, prevented the country from being laid at the
mercy of British and ultra-federalists for funds to carry on the
last war. It is said the United States lost forty millions by
using depreciated currency during the last war. That, probably,
is a mistake of one half. But be it so! For what are forty
millions compared to the loss of the war itself--compared to the
ruin and infamy of having the government arrested for want of
money--stopped and paralyzed by the reception of such a note as
the younger Pitt received from the Bank of England in 1795?
"11. Exemption from due course of law for violations of its
charter.--This is a privilege which affects the administration
of justice, and stands without example in the annals of
republican legislation. In the case of all other delinquents,
whether persons or corporations, the laws take their course
against those who offend them. It is the right of every citizen
to set the laws in motion against every offender; and it is the
constitution of the law, when set in motion, to work through,
like a machine, regardless of powers and principalities, and
cutting down the guilty which may stand in its way. Not so in
the case of this bank. In its behalf, there are barriers erected
between the citizen and his oppressor, between the wrong and the
remedy, between the law and the offender. Instead of a right
to sue out a _scire facias_ or a _quo warranto_, the injured
citizen, with an humble petition in his hand, must repair to
the President of the United States, or to Congress, and crave
their leave to do so. If leave is denied (and denied it will be
whenever the bank has a peculiar friend in the President, or a
majority of such friends in Congress, the convenient pretext
being always at hand that the general welfare requires the bank
to be sustained), he can proceed no further. The machinery of
the law cannot be set in motion, and the great offender laughs
from behind his barrier at the impotent resentment of its
helpless victim. Thus the bank, for the plainest violations
of its charter, and the greatest oppressions of the citizen,
may escape the pursuit of justice. Thus the administration
of justice is subject to be strangled in its birth for the
shelter and protection of this bank. But this is not all.
Another and most alarming mischief results from the same
extraordinary privilege. It gives the bank a direct interest in
the presidential and congressional elections: it gives it need
for friends in Congress and in the presidential chair. Its fate,
its very existence, may often depend upon the friendship of the
President and Congress; and, in such cases, it is not in human
nature to avoid using the immense means in the hands of the bank
to influence the elections of these officers. Take the existing
fact--the case to which I alluded at the commencement of this
speech. There is a case made out, ripe with judicial evidence,
and big with the fate of the bank. It is a case of usury at the
rate of forty-six per cent., in violation of the charter, which
only admits an interest of six. The facts were admitted, in the
court below, by the bank's demurrer; the law was decided, in
the court above, by the supreme judges. The admission concludes
the facts; the decision concludes the law. The forfeiture of
the charter is established; the forfeiture is incurred; the
application of the forfeiture alone is wanting to put an end to
the institution. An impartial President or Congress might let
the laws take their course; those of a different temper might
interpose their veto. What a crisis for the bank! It beholds the
sword of Damocles suspended over its head! What an interest in
keeping those away who might suffer the hair to be cut!
"12. To have all these unjust privileges secured to the
corporators as a monopoly, by a pledge of the public faith to
charter no other bank.--This is the most hideous feature in
the whole mass of deformity. If these banks are beneficial
institutions, why not several? one, at least, and each
independent of the other, to each great section of the Union?
If malignant, why create one? The restriction constitutes the
monopoly, and renders more invidious what was sufficiently
hateful in itself. It is, indeed, a double monopoly, legislative
as well as banking; for the Congress of 1816 monopolized the
power to grant these monopolies. It has tied up the hands
of its successors; and if this can be done on one subject,
and for twenty years, why not upon all subjects, and for all
time? Here is the form of words which operate this double
engrossment of our rights: 'No other bank shall be established
by any future law of Congress, during the continuance of the
corporation hereby enacted, for which the faith of Congress is
hereby pledged;' with a proviso for the District of Columbia.
And that no incident might be wanting to complete the title of
this charter, to the utter reprobation of whig republicans,
this compound monopoly, and the very form of words in which
it is conceived, is copied from the charter of the Bank of
England!--not the charter of William and Mary, as granted in
1694 (for the Bill of Rights was then fresh in the memories of
Englishmen), but the charter as amended, and that for money, in
the memorable reign of Queen Anne, when a tory queen, a tory
ministry, and a tory parliament, and the apostle of toryism, in
the person of Dr. Sacheverell, with his sermons of divine right,
passive obedience, and non-resistance, were riding and ruling
over the prostrate liberties of England! This is the precious
period, and these the noble authors, from which the idea was
borrowed, and the very form of words copied, which now figure in
the charter of the Bank of the United States, constituting that
double monopoly, which restricts at once the powers of Congress
and the rights of the citizens.
"These, Mr. President, are the chief of the exclusive privileges
which constitute the monopoly of the Bank of the United States.
I have spoken of them, not as they deserved, but as my abilities
have permitted. I have shown you that they are not only evil in
themselves, but copied from an evil example. I now wish to show
you that the government from which we have made this copy has
condemned the original; and, after showing this fact, I think I
shall be able to appeal, with sensible effect, to all liberal
minds, to follow the enlightened example of Great Britain, in
getting rid of a dangerous and invidious institution, after
having followed her pernicious example in assuming it. For
this purpose, I will have recourse to proof, and will read
from British state papers of 1826. I will read extracts from
the correspondence between Earl Liverpool, first Lord of the
Treasury, and Mr. Robinson, Chancellor of the Exchequer, on the
one side, and the Governor and Deputy Governor of the Bank of
England on the other; the subject being the renewal, or rather
non-renewal, of the charter of the Bank of England.
_Communications from the First Lord of the Treasury and Chancellor
of the Exchequer to the Governor and Deputy Governor of the Bank of
England.--Extracts._
"'The failures which have occurred in England, unaccompanied
as they have been by the same occurrences in Scotland, tend
to prove that there must have been an unsolid and delusive
system of banking in one part of Great Britain, and a solid
and substantial one in the other. * * * * In Scotland, there
are not more than thirty banks (three chartered), and these
banks have stood firm amidst all the convulsions of the money
market in England, and amidst all the distresses to which the
manufacturing and agricultural interests in Scotland, as well
as in England, have occasionally been subject. Banks of this
description must necessarily be conducted upon the generally
understood and approved principles of banking. * * * * The
Bank of England may, perhaps, propose, as they did upon a
former occasion, the extension of the term of their exclusive
privilege, as to the metropolis and its neighborhood, beyond
the year 1833, as the price of this concession [immediate
surrender of exclusive privileges]. It would be very much to be
regretted that they should require any such condition. * * * *
It is obvious, from what passed before, that Parliament will
never agree to it. * * * * Such privileges are out of fashion;
and what expectation can the bank, under present circumstances,
entertain that theirs will be renewed?'--_Jan. 13._
_Answer of the Court of Directors.--Extract._
"'Under the uncertainty in which the Court of Directors find
themselves with respect to the death of the bank, and the
effect which they may have on the interests of the bank, this
court cannot feel themselves justified in recommending to the
proprietors to give up the privilege which they now enjoy,
sanctioned and confirmed as it is by the solemn acts of the
legislature.'--_Jan. 20._
_Second communication from the Ministers.--Extract._
"'The First Lord of the Treasury and Chancellor of the Exchequer
have considered the answer of the bank of the 20th instant.
They cannot but regret that the Court of Directors should
have declined to recommend to the Court of Proprietors the
consideration of the paper delivered by the First Lord of the
Treasury and the Chancellor of the Exchequer to the Governor and
Deputy Governor on the 13th instant. The statement contained
in that paper appears to the First Lord of the Treasury and
the Chancellor of the Exchequer so full and explicit on all
the points to which it related, that they have nothing further
to add, although they would have been, and still are, ready to
answer, as far as possible, any specific questions which might
be put, for the purpose of removing the uncertainty in which the
court of directors state themselves to be with respect to the
details of the plan suggested in that paper.'--_Jan. 23._
_Second answer of the Bank.--Extract._
"'The Committee of Treasury [bank] having taken into
consideration the paper received from the First Lord of the
Treasury and the Chancellor of the Exchequer, dated January
23d, and finding that His Majesty's ministers persevere in
their desire to propose to restrict immediately the exclusive
privilege of the bank, as to the number of partners engaged in
banking to a certain distance from the metropolis, and also
continue to be of opinion that Parliament would not consent to
renew the privilege at the expiration of the period of their
present charter; finding, also, that the proposal by the bank of
establishing branch banks is deemed by His Majesty's ministers
inadequate to the wants of the country, are of opinion that
it would be desirable for this corporation to propose, as a
basis, the act of 6th of George the Fourth, which states,
the conditions on which the Bank of Ireland relinquished its
exclusive privileges; this corporation waiving the question of
a prolongation of time, although the committee [of the bank]
cannot agree in the opinion of the First Lord of the Treasury
and the Chancellor of the Exchequer, that they are not making
a considerable sacrifice, adverting especially to the Bank of
Ireland remaining in possession of that privilege five years
longer than the Bank of England.'--_January 25._
* * * * *
"Here, Mr. President, is the end of all the exclusive privileges
and odious monopoly of the Bank of England. That ancient and
powerful institution, so long the haughty tyrant of the moneyed
world--so long the subsidizer of kings and ministers--so long
the fruitful mother of national debt and useless wars--so
long the prolific manufactory of nabobs and paupers--so long
the dread dictator of its own terms to parliament--now droops
the conquered wing, lowers its proud crest, and quails under
the blows if its late despised assailants. It first puts on a
courageous air, and takes a stand upon privileges sanctioned by
time, and confirmed by solemn acts. Seeing that the ministers
could have no more to say to men who would talk of privileges in
the nineteenth century, and being reminded that parliament was
inexorable, the bully suddenly degenerates into the craven, and,
from showing fight, calls for quarter. The directors condescend
to beg for the smallest remnant of their former power, for five
years only; for the city of London even; and offer to send
branches into all quarters. Denied at every point, the subdued
tyrant acquiesces in his fate; announces his submission to the
spirit and intelligence of the age; and quietly sinks down
into the humble, but safe and useful condition of a Scottish
provincial bank.
"And here it is profitable to pause; to look back, and see by
what means this ancient and powerful institution--this Babylon
of the banking world--was so suddenly and so totally prostrated.
Who did it? And with what weapons? Sir, it was done by that
power which is now regulating the affairs of the civilized
world. It was done by the power of public opinion, invoked by
the working members of the British parliament. It was done
by Sir Henry Parnell, who led the attack upon the Wellington
ministry, on the night of the 15th of November; by Sir William
Pulteney, Mr. Grenfell, Mr. Hume, Mr. Edward Ellice, and others,
the working members of the House of Commons, such as had, a few
years before, overthrown the gigantic oppressions of the salt
tax. These are the men who have overthrown the Bank of England.
They began the attack in 1824, under the discouraging cry of
too soon, too soon--for the charter had then nine years to run!
and ended with showing that they had began just soon enough.
They began with the ministers in their front, on the side of
the bank, and ended with having them on their own side, and
making them co-operators in the attack, and the instruments and
inflicters of the fatal and final blow. But let us do justice to
these ministers. Though wrong in the beginning, they were right
in the end; though monarchists, they behaved like republicans.
They were not Polignacs. They yielded to the intelligence of the
age; they yielded to the spirit which proscribes monopolies and
privileges, and in their correspondence with the bank directors,
spoke truth and reason and asserted liberal principles, with
a point and power which quickly put an end to dangerous and
obsolete pretensions. They told the bank the mortifying truths,
that its system was unsolid and delusive--that its privileges
and monopoly were out of fashion--that they could not be
prolonged for five years even--nor suffered to exist in London
alone; and, what was still more cutting, that the banks of
Scotland, which had no monopoly, no privilege, no connection
with the government, which paid interest on deposits, and
whose stockholders were responsible to the amount of their
shares--were the solid and substantial banks, which alone the
public interest could hereafter recognize. They did their
business, when they undertook it, like true men; and, in the
single phrase, '_out of fashion_,' achieved the most powerful
combination of solid argument and contemptuous sarcasm, that
ever was compressed into three words. It is a phrase of
electrical power over the senses and passions. It throws back
the mind to the reigns of the Tudors and Stuarts--the termagant
Elizabeth and the pedagogue James--and rouses within us all the
shame and rage we have been accustomed to feel at the view of
the scandalous sales of privileges and monopolies which were
the disgrace and oppression of these wretched times. Out of
fashion! Yes; even in England, the land of their early birth,
and late protection. And shall they remain in fashion here?
Shall republicanism continue to wear, in America, the antique
costume which the doughty champions of antiquated fashion have
been compelled to doff in England? Shall English lords and
ladies continue to find, in the Bank of the United States, the
unjust and odious privileges which they can no longer find in
the Bank of England? Shall the copy survive here, after the
original has been destroyed there? Shall the young whelp triumph
in America, after the old lion has been throttled and strangled
in England? No! never! The thing is impossible! The Bank of the
United States dies, as the Bank of England dies, in all its
odious points, upon the limitation of its charter; and the only
circumstance of regret is, that the generous deliverance is to
take effect two years earlier in the British monarchy than in
the American republic. It came to us of war--it will go away
with peace. It was born of the war of 1812--it will die in the
long peace with which the world is blessed. The arguments on
which it was created will no longer apply. Times have changed;
and the policy of the republic changes with the times. The war
made the bank; peace will unmake it. The baleful planet of fire,
and blood, and every human woe, did bring that pestilence upon
us; the benignant star of peace shall chase it away."
This speech was not answered. Confident in its strength, and
insolent in its nature, the great moneyed power had adopted a system
in which she persevered, until hard knocks drove her out of it: it
was to have an anti-bank speech treated with the contempt of silence
in the House, and caricatured and belittled in the newspapers; and
according to this system my speech was treated. The instant it was
delivered, Mr. Webster called for the vote, and to be taken by yeas
and nays, which was done; and resulted differently from what was
expected--a strong vote against the bank--20 to 23; enough to excite
uneasiness, but not enough to pass the resolution and legitimate a
debate on the subject. The debate stopped with the single speech;
but it was a speech to be read by the people--the masses--the
millions; and was conceived and delivered for that purpose; and
was read by them; and has been complimented since, as having
crippled the bank, and given it the wound of which it afterwards
died; but not within the year and a day which would make the slayer
responsible for the homicide. The list of yeas and nays was also
favorable to the effect of the speech. Though not a party vote, it
was sufficiently so to show how it stood--the mass of the democracy
against the bank--the mass of the anti-democrats against it. The
names were:--
"YEAS.--Messrs. Barnard, Benton, Bibb, Brown, Dickerson, Dudley,
Forsyth, Grundy, Hayne, Iredell, King, McKinley, Poindexter,
Sanford, Smith of S. C., Tazewell, Troup, Tyler, White,
Woodbury--20.
"NAYS.--Messrs. Barton, Bell, Burnet, Chase, Clayton, Root,
Frelinghuysen, Holmes, Hendricks, Johnston, Knight, Livingston,
Marks, Noble, Robbins, Robinson, Ruggles, Seymour, Silsbee,
Smith of Md., Sprague, Webster, Willey--23."