RESUMPTION OF SPECIE PAYMENTS BY THE NEW YORK BANKS.
The suspension commenced on the 10th of May in New York, and was
followed throughout the country. In August the New York banks
proposed to all others to meet in convention, and agree upon a time
to commence a general resumption. That movement was frustrated by
the opposition of the Philadelphia banks, for the reason, as given,
that it was better to await the action of the extra session of
Congress, then convoked, and to meet in September. The extra session
adjourned early in October, and the New York banks, faithful to the
promised resumption of specie payments, immediately issued another
invitation for the general convention of the banks in that city on
the 27th of November ensuing, to carry into effect the object of
the meeting which had been invited in the month of August. The 27th
of November arrived; a large proportion of the delinquent banks had
accepted the invitation to send delegates to the convention: but
its meeting was again frustrated--and from the same quarter--the
Bank of the United States, and the institutions under its influence.
They then resolved to send a committee to Philadelphia to ascertain
from the banks when they would be ready, and to invite them to
name a day when they would be able to resume; and if no day was
definitely fixed, to inform them that the New York banks would
commence specie payments without waiting for their co-operation. The
Philadelphia banks would not co-operate. They would not agree to
any definite time to take even initiatory steps towards resumption.
This was a disappointment to the public mind--that large part of
it which still had faith in the Bank of the United States; and the
contradiction which it presented to all the previous professions
of that institution, required explanations, and, if possible,
reconciliation with past declarations. The occasion called for the
pen of Mr. Biddle, always ready, always confident, always presenting
an easy remedy, and a sure one, for all the diseases to which banks,
currency, and finance were heir. It called for another letter to
Mr. John Quincy Adams, that is to say, to the public, through the
distinction of that gentleman's name. It came--the most elaborate
and ingenious of its species; its burden, to prove the entire
ability of the bank over which he presided to pay in full, and
without reserve, but its intention not to do so on account of its
duty to others not able to follow its example, and which might be
entirely ruined by a premature effort to do so. And he concluded
with condensing his opinion into a sentence of characteristic and
sententious brevity: "_On the whole, the course which in my judgment
the banks ought to pursue, is simply this: The banks should remain
exactly as they are--prepared to resume, but not yet resuming._" But
he did not stop there, but in another publication went the length of
a direct threat of destruction against the New York banks if they
should, in conformity to their promise, venture to resume, saying:
"Let the banks of the Empire State come up from their Elba, and
enjoy their hundred days of resumption! a Waterloo awaits them, and
a Saint Helena is prepared for them."_
The banks of New York were now thrown upon the necessity of acting
without the concurrence of those of Pennsylvania, and in fact under
apprehension of opposition and counteraction from that quarter. They
were publicly pledged to act without her, and besides were under a
legal obligation to do so. The legislature of the State, at the time
of the suspension, only legalized it for one year. The indulgence
would be out on the 15th of May, and forfeiture of charter was the
penalty to be incurred throughout the State for continuing it beyond
that time. The city banks had the control of the movement, and they
invited a convention of delegates from all the banks in the Union to
meet in New York on the 15th of April. One hundred and forty-three
delegates, from the principal banks in a majority of the States,
attended. Only delegates from fifteen States voted--Pennsylvania,
Maryland and South Carolina among the absent; which, as including
the three principal commercial cities on the Atlantic board south of
New York, was a heavy defalcation from the weight of the convention.
Of the fifteen States, thirteen voted for resuming on the 1st day
of January, 1839--a delay of near nine months; two voted against
that day--New York and Mississippi; and (as it often happens in
concurring votes) for reasons directly opposite to each other. The
New York banks so voted because the day was too distant--those of
Mississippi because it was too near. The New York delegates wished
the 15th of May, to avoid the penalty of the State law: those of
Mississippi wished the 1st of January, 1840, to allow them to get in
two more cotton crops before the great pay-day came. The result of
the voting showed the still great power of the Bank of the United
States. The delegates of the banks of ten States, including those
with which she had most business, either refused to attend the
convention, or to vote after having attended. The rest chiefly voted
the late day, "_to favor the views of Philadelphia and Baltimore
rather than those of New York_." So said the delegates, "_frankly
avowing that their interests and sympathies were with the former two
rather than with the latter_." The banks of the State of New York
were then left to act alone--and did so. Simultaneously with the
issue of the convention recommendation to resume on the first day
of January, 1839, they issued another, recommending all the banks
of the State of New York to resume on the 10th day of May, 1838;
that is to say, within twenty-five days of that time. Those of the
city declared their determination to begin on that day, or earlier,
expressing their belief that they had nothing to fear but from the
opposition and "deliberate animosity of others"--meaning the Bank
of the United States. The New York banks all resumed at the day
named. Their example was immediately followed by others, even by the
institutions in those States whose delegates had voted for the long
day; so that within sixty days thereafter the resumption was almost
general, leaving the Bank of the United States uncovered, naked,
and prominent at the head of all the delinquent banks in the Union.
But her power was still great. Her stock stood at one hundred and
twelve dollars to the share, being a premium of twelve dollars on
the hundred. In Congress, which was still in session, not a tittle
was abated of her pretensions and her assurance--her demands for
a recharter--for the repeal of the specie circular--and for the
condemnation of the administration, as the author of the misfortunes
of the country; of which evils there were none except the bank
suspensions, of which she had been the secret prime contriver
and was now the detected promoter. Briefly before the New York
resumption, Mr. Webster the great advocate of the Bank of the United
States, and the truest exponent of her wishes, harangued the Senate
in a set speech in her favor, of which some extracts will show the
design and spirit:
"And now, sir, we see the upshot of the experiment. We see
around us bankrupt corporations and broken promises; but we see
no promises more really and emphatically broken than all those
promises of the administration which gave us assurance of a
better currency. These promises, now broken, notoriously and
openly broken, if they cannot be performed, ought, at least, to
be acknowledged. The government ought not, in common fairness
and common honesty, to deny its own responsibility, seek to
escape from the demands of the people, and to hide itself,
out of the way and beyond the reach of the process of public
opinion, by retreating into this sub-treasury system. Let it, at
least, come forth; let it bear a port of honesty and candor; let
it confess its promises, if it cannot perform them; and, above
all, now, even now, at this late hour, let it renounce schemes
and projects, the inventions of presumption, and the resorts
of desperation, and let it address itself, in all good faith,
to the great work of restoring the currency by approved and
constitutional means.
"What say these millions of souls to the sub-treasury? In
the first place, what says the city of New York, that great
commercial emporium, worthy the gentleman's [Mr. Wright]
commendation in 1834, and worthy of his commendation and
my commendation, and all commendation, at all times? What
sentiments, what opinions, what feelings, are proclaimed
by the thousands of merchants, traders, manufacturers, and
laborers? What is the united shout of all the voices of all her
classes? What is it but that you will put down this new-fangled
sub-treasury system, alike alien to their interests and their
feelings, at once, and for ever? What is it, but that in mercy
to the mercantile interest, the trading interest, the shipping
interest, the manufacturing interest, the laboring class, and
all classes, you will give up useless and pernicious political
schemes and projects, and return to the plain, straight course
of wise and wholesome legislation? The sentiments of the city
cannot be misunderstood. A thousand pens and ten thousand
tongues, and a spirited press, make them all known. If we have
not already heard enough, we shall hear more. Embarrassed,
vexed, pressed and distressed, as are her citizens at this
moment, yet their resolution is not shaken, their spirit is not
broken; and, depend upon it, they will not see their commerce,
their business, their prosperity and their happiness, all
sacrificed to preposterous schemes and political empiricism,
without another, and a yet more vigorous struggle.
"Sir, I think there is a revolution in public opinion now going
on, whatever may be the opinion of the member from New York, or
others. I think the fall elections prove this, and that other
more recent events confirm it. I think it is a revolt against
the absolute dictation of party, a revolt against coercion on
the public judgment; and, especially, against the adoption of
new mischievous expedients on questions of deep public interest;
a revolt against the rash and unbridled spirit of change; a
revolution, in short, against further revolution. I hope, most
sincerely, that this revolution may go on; not, sir, for the
sake of men, but for the sake of measures, and for the sake of
the country. I wish it to proceed, till the whole country, with
an imperative unity of voice, shall call back Congress to the
true policy of the government.
"I verily believe a majority of the people of the United
States are now of the opinion that a national bank, properly
constituted, limited, and guarded, is both constitutional and
expedient, and ought now to be established. So far as I can
learn, three-fourths of the western people are for it. Their
representatives here can form a better judgment; but such is my
opinion upon the best information which I can obtain. The South
may be more divided, or may be against a national institution;
but, looking again to the centre, the North and the East, and
comprehending the whole in one view, I believe the prevalent
sentiment is such as I have stated.
"At the last session great pains were taken to obtain a vote of
this and the other House against a bank, for the obvious purpose
of placing such an institution out of the list of remedies, and
so reconciling the people to the sub-treasury scheme. Well, sir,
and did those votes produce any effect? None at all. The people
did not, and do not, care a rush for them. I never have seen,
or heard, a single man, who paid the slightest respect to those
votes of ours. The honorable member, to-day, opposed as he is
to a bank, has not even alluded to them. So entirely vain is
it, sir, in this country, to attempt to forestall, commit, or
coerce the public judgment. All those resolutions fell perfectly
dead on the tables of the two Houses. We may resolve what we
please, and resolve it when we please; but if the people do not
like it, at their own good pleasure they will rescind it; and
they are not likely to continue their approbation long to any
system of measures, however plausible, which terminates in deep
disappointment of all their hopes, for their own prosperity."
All the friends of the Bank of the United States came to her
assistance in this last trial. The two halls of Congress resounded
with her eulogium, and with condemnation of the measures of the
administration. It was a last effort to save her, and to force her
upon the federal government. Multitudes of speakers on one side
brought out numbers on the other--among those on the side of the
sub-treasury and hard money, and against the whole paper system, of
which he considered a national bank the citadel, was the writer of
this View, who undertook to collect into a speech, from history and
experience, the facts and reasons which would bear upon the contest,
and act upon the judgment of candid men, and show the country to be
independent of banks, if it would only will it. Some extracts from
that speech make the next chapter.