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Mr. Speaker, I am deeply impressed with feelings of gratitude to the House for its kind indulgence, and still more for the patient attention with which my very desultory remarks upon this occasion have been heard. And whilst for this manifestation of the kindness of the House, I return the humble tribute of my most profound acknowl. edgement, I am not vain enough to take as a compliment to myself what I am sure has been alone due to the importance and magnitude of the subject under consideration. Mr. WISE eulogized his colleague on the course he had just taken. He was glad to find displayed so honorable and independent an opposition to the bill. Mr. W. then read several extracts from President Jackson's messages of 1834 and 1835, to show that the sales of Government stock in the United States Bank had been recommended by the President at those periods. Mr. UNDERWOOD said, in consequence of what had fallen from other members in the course of the debate upon his amendment, he desired to make a few explanatory remarks. The gentleman across the way [Mr. Pattox] expressed great surprise at the quarter in which the amendment originated; while the member to my left [Mr. CAMBRELENG) is astonished that the gentleman from Virginia should have felt any surprise, since the amendment had been proposed by a known friend of the bank. It may be inferred from these statements that I have been actuated by some sinister motive; that I have designed to promote the interest of the bank at the expense of that of the country. [Mr. CAMBRELENG disclaimed any intention to impute an unworthy motive to Mr. U., who continued.] I have never (said Mr. U.) been connected with the late Bank of the United States, or the present bank of that name, in any manner which could bias my judgment. I have never owned one dollar of stock in either. I have never borrowed one cent from either bank on my own account. I have been compelled to pay considerable suins to the late bank, as surety; and, with that exception, have had no transactions with these banks. At this time I am not the debtor of the bank in any way. I know, sir, that I am wholly uninfluenced in offering the amendment by partiality or hatred to the bank. My amendment is based upon a very obvious principle. If I owe money and have it not, I am bound by law and morals to get it. If a neighbor owes me, or I have his bond not yet due, I may and ought to raise the money upon the debt thus owing to me, if I have no better means. If I can sell my neighbor's bond, without sacrifice, to pay my debts, who can or will blame me ! I do not injure him, and I benefit myself. Now, sir, apply the case. The Government wants money; it holds bonds on the bank; it owes debts and must pay them; my amendment proposes to sell the bonds without sacrifice, and apply the proceeds in discharge of what the Governinent owes. I prefer this to the creation of a national debt, by issuing Treasury notes or by borrowing money; but, to guard against the possibility of failing to sell the bonds for their nominal amount, I provide, in case the bonds cannot be sold, that the Secretary may borrow six and a half millions. I consider it my duty to grant all the facilities necessary to maintain the credit of the Government, and to give vigor and health to its operations, and I never will be influenced by a spirit of factious opposition to any administration. I have accepted the amendment proposed by the gentleman from Virginia, [Mr. Pattox,] because it can do no harm, and it may afford some additional facilities to the Secretary of the Treasury. He now draws checks or drafts on the deposite banks, knowing at the time they will not be paid. If the creditors of Government will accept such drafts hereafter, let them do it. Perhaps the banks may pay some, and if they will not, then let those drafts be received in payment for duties, taxes, or public land. This practice cannot make things worse. It may relieve, to
some extent; and I therefore accepted the gentleman's amendment as a modification of my own. Some gentlemen have supposed that the limitation which my amendment contemplates, in regard to the amount to be borrowed, is objectionable. They apprehend that six and a half millions is too small a sum. I am satisfied that it is amply sufficient. But, out of deference to the opinion of others, I will deser offering that part of the amendment until the House has decided on the first part of my proposition. If the first part be accepted, I will then offer the second, leaving the amount blank, so that the House may fill it at its discretion. In these amendments I have had no intention to embarrass the Government. I have been actuated by a sincere desire to support, instead of pulling down. And I cannot help wishing most ardently that the scheme I have presented may find savor with a majority of the House. I shall feel happy, very happy, if my offered substitute is accepted in lieu of the bill—a bill which lays the foundation for a Government bank and paper money, subject to the control of the President of the United States. Sir, if the day ever comes when the Executive of this nation shall control at his will and pleasure a Government bank, with millions of money, through such agents as he may choose to employ, removable at his pleasure, lending it out in such sums and to such persons as he pleases, that day will be signalized, in the annals of time, for the overthrow of American liberty I did not rise to make an argument or to go at large into the discussion. The whole subject has been ably debated by others, and by none more so than the gentleman to my right, [Mr. Hopkins,] a son of the Old Dominion—a native of the same county where I drew my first breath; and whose speech and nativity combined have produced in my bosom very fraternal feelings towards him. I am anxious that my amendment may be tested by the vote of the House without further delay. Mr. HAYNES replied to Mr. Wise that the sale of the bank stock severed all connexion of the Government with the bank as a partnership concern; but that was no reason Government ought not still to hold the bonds of that institution taken in payment for the stock. Mr. WISE said that these bonds were a mere liquidation of the account of value of the stock; and, while the Government held them, the connexion still continued as though it held the stock. Mr. McKAY would have no objection to the sale of these bonds, if it could be done fairly, for their full value; but this would take time, and the Treasury must have immediate relief. He denied that the bill was deceptive; every man, on reading it, must perceive it was a bill for a loan; what else was it? Mr. ROBERTSON rose and said, if the administration had no other object in view than to raise a sufficiency of money to meet the real wants of the Treasury, he was at a loss to comprehend the cause of these persevering efforts to raise it by the issue of Treasury notes. The amendment of the gentleman from Kentucky, [Mr. UNDER wood,) as modified, proposed to give the right to disposo of the debt of about six millions due from the Bank of the United States; and that of his colleague, [Mr. PATtoN, ) if he understood it, to superadd the power of drawing upon the State banks, which held ten or twelve millions of public money. If these resources should prove insufficient, authority might be conferred to borrow whatever sum .*. necessary to make up the deficiency. But none of these obvious and ordinary methods of replenishing the Treasury will now answer the purpose. Nothing will do but to resort to the extraordinary and dangerous resource of an issue of Treasury notes. In times of great difficulty, when engaged in war with one of the most powerful nations of Europe, we were compelled, from sheer bills were so depreciated that they were funded at 100 for 1. Such were the evils attending the system, that the framers of the constitution, to guard against their recurrence, thought it necessary to interdict the States in express terms from emitting bills of credit. I will not, sir, (said Mr. R.,) at this time enter into the question whether the power thus prohibited to the States rightfully belongs to this Government. There is much force, all must admit, in the reference made by the gentleman from Massachusetts [Mr. Cushing] to the journal of the convention, showing that a proposition to clothe this Government with the power was expressly overruled. With those who rely on the same ground, not verified by the journal, but depending on the memory of members of the convention, as an argument against the power to establish a national bank, this reference ought to be conclusive. Certain it is, that the power was not expressly granted, as were those to lay taxes and borrow money; and the rule of interpretation, as given by the constitution itself, is, that the powers not delegated to the United States, nor prohibited to the States, are reserved to the States or to the people. It is obvious that its exercise by the General Government is equally dangerous; indeed, liable to much greater abuse. The States can effect none, to any considerable extent, except those within their respective limits; but we may inundate the Union with a spurious currency; and when the system shall be once commenced, no one can undertake to say where it is to stop. During the late war, immediately after it was declared, Congress again resorted to an issue of Treasury notes—at first upon a moderate scale, only five millions of dollars. But from time to time, other and larger issues were authorized, until, at the end of two or three years, twenty-five millions were authorized at a dash. So it may be again. We begin now, in a period of profound peace—for I will not dignify the Indian hunt in Florida with the name of war—with an issue of ten millions for the service of this remnant of the year. Those who urge the measure may mean in good faith to go no further. But who shall say, when we have once tasted the sweets of the poison, when we have indulged in the practice of raising money by this pernicious process, without incurring responsibility, to what extent it will be carried ? What is now proposed as a temporary expedient may become the settled policy of the Government. Sir, I protest against it as a dangerous practice. Obsta principiis. Our only safety is in resisting it at the threshold. Let us for a moment, Mr. Speaker, look to our actual position; and we cannot but be amazed at the point to which we have arrived. But a few months since, the late President congratulated the country on the success of his efforts to restore a sound, constitutional currency. But one short month since, the present President gave his recommendation in favor of a hard-money system, as the only one proper for the Government to tolerate. He seems disposed to reject convertible paper, even during the present difficulty of procuring the precious metals. And now it is gravely proposed to manufacture ten millions of paper money for circulation, not only without a specie basis, but without the pledge of any definite fund for its ultimate redemption. But, sir, strange as this may appear, the scheme is not altogether a novelty. A petition was, during the present session, referred to the committee of which I have the honor to be a member, (Judiciary,) from a Mr. Sargent, of South Carolina, for the establishment—not of a coin mint, for there is one, he says, already—but of what he calls a general print mint at Washington, for the emission of paper money to the amount, perhaps, of two hundred millions of dollars, as a currency for the United States. The money to be manufactured he proposes to
Oct. 6, 1837.] Treasury Notes. [H. of R. necessity, to adopt that method of raising supplies. . Dur- call “print,” from the first syllable of the word “printing the Revolutionary war we had issued upwards of three ing;” as the first syllable of the word “coining” gives the hundred millions in bills of credit, and at its close these name of “coin.” So that the thing may be readily
understood. When you receive hard money, you are to say I was paid in coin; when you take paper, I was paid in print. His plan is given in detail, and, as you may suppose, sir, was the subject of merriment, of derision, in the committee room. The committee did not deign to give it a serious consideration. It served only to excite their risible muscles, and to create no very favorable impressions of the state of the petitioner's understanding. Well, sir, to my great surprise, here is the scheme before us—not corresponding in amount, but pretty much the same in principle—gravely proposed by the chairman of the Committee of Ways and Means; the establishment of a manufactory of paper money—a print mint here in Washington. We begin at length to understand what the exclusive friends of a hard-money Government mean by the term. They are to issue bits of stamped or printed paper, and call them—not “print,” as Mr. Sargent honestly calls his— but gold and silver. Yes, sir, the gentleman from Maryland, [Mr. McKry, deeply versed in all moneyed concerns, and who has been so highly complimented for his financial talents, tells us, in so many words, these ten millions of Treasury notes are ten milliions of gold and silver. When the gentleman made the remark, he forcibly reminded me of my Lord Peter, in the Tale of a Tub. The anecdote, no doubt, is familiar to all. Beef, it had been said, contained the quintessence of partridge, and quail, and venison, and wild duck; and so, my Lord Peter insisted, did his wheaten loaf. In this conceit, he invited his brethren to dine with him. The repast consisted alone of this wheaten loaf. He asked them if they would eat a bit of the mutton; and, when they assented, cut his loaf, and handed a slice to each. They supposed he was jesting ; but, finding him in earnest, they remonstrated, and had the boldness to deny that bread was mutton. Lord Peter argued the point with them for some time; but finally cut the matter short with this unanswerable argument: He said he would affirm it to be as good mutton as any in Leadenhall market; and, if they did not believe it, they deserved to be eternally damned. So, sir, the gentleman from Maryland tells us his Treasury notes, his “print,” is gold and silver—nothing less; and all who do not credit it are to be condemned outright as mere infidels and heretics. Sir, it is not gold and silver, nor their equivalent. The Government may as well issue the German silver cents recently coined by the man with the Dutch name, (Feuchtwanger, ) and tell us each is a coin of pure gold, of the value of $10,000, as to stamp worthless paper, and tell us it is gold and silver, or of equal value with them. It will depreciate, as it has always depreciated. Indeed, unless I am misinformed, it is destined to commence its circulation considerably below par. [Mr. Wisk here remarked that the fact was as his colleague had stated it. He held the document in his hand that proved it.) Mr. Rob Entson. Will my colleague oblige me by reading the proof to which he refers ? [Mr. Wise read from the document a letter to the Secretary of the Treasury from Ward, Prime, and King, relative to the value of Treasury notes in the market. Mr. CAMBR Elk Ng observed, that was a letter from the gentleman's own friends l Mr. Rob Entson resumed. The gentleman from New York says this offer is from our own friends; yet I am told it is the best that has been made. I have not the honor of being acquainted with these friends of ours, but I am happy to learn we have such, who will give more for the Government paper than the friends of the gentleman and of the administration. This, then, is the true state of the case: our paper is actually dishonored in advance; and gentlemen who will not lower the dignity of the Government, by selling the bonds due to us, or by borrowing money, are ready to throw our own paper into the market at a discount of six or eight per cent. Sir, I cannot agree to it. These Treasury notes, if really intended for the purpose of raising revenue, are unnecessary. There are other and ample resources at the command of the Government. If designed for circulation, they are both unnecessary and unconstitutional. Why should the Government discredit and reject the currency of the States— that which our State Governments accept in payment of taxes, and which our citizens receive from each other ? It would be regarded as oppressive in the State Governments, dishonorable on the part of individuals at this time to exact gold and silver. Why should this paternal Government of the United States not receive what the State Governments receive——what, indeed, our people alone can procure ? And what right, permit me to ask, has this Government to create a paper currency They have a right to coin money, and regulate the value thereof, and of foreign coins; but they have no right to put a stamp upon paper, and call that coining money. The constitution nowhere warrants such a process. In every aspect, Mr. Speaker, this scheme appears to me substantially the establishment of a Government bank. If the paper be designed as a circulating medium, the Treasury becomes a bank of issue and circulation merely. But the scheme goes further. It authorizes not only the payment of these notes to public creditors, but the borrowing of money upon their credit. What is this in effect but a banking operation ? You apply to the Secretary, who is thus authorized to borrow, and propose to lend him half a million or a million of dollars. He is not in immediate want of the money. You offer, for a given sum in Treasury notes, to supply him with one or two hundred thousand dollars monthly, in munitions of war, in rations, or in money, until an amount equal to the value of the notes in the market shall be furnished. There is nothing in the law to prevent such a negotiation. But how does it differ in substance from a bank loan In a negotiation with the bank, you give your note, and usually receive the notes of the bank as money. In that supposed with the Secretary of the Treasury, you give your note or agreement, and receive Treasury notes—the notes of the Government—which are to answer all the purposes of money. In form, you are the lender; in effect, the borrower. Call the plan by what name you will, it is a bank in its essential features, or destined, if persisted in, to become one. It is now but in the egg state; and I would crush it in the egg. I am opposed to it, Mr. Speaker, in every form in which it can be presented; though I shall vote in favor of the amendment of the gentleman from Kentucky. It is not that I doubt the good faith of the Government, or its perfect ability to redeem ten times the amount authorized by the bill. It is because I believe the measure unnecessary, if not unconstitutional. It is because all experience has shown that the power of raising money in this form, evading a direct responsibility, is fraught with mischief. It will be abused, as it has always been abused. I will resort to any and every other usual method of supplying the necessary wants of the Government. I will vote for six millions, or ten millions, if really needed; to be raised by a sale of our claims upon our debtors; by way of loan, or by a tax; but I will vote for no issue of Treasury notes, for no indirect loan, nor for any sum whatever to create a surplus beyond the actual wants of the Treasury. Mr. LEGARE rose and said: If the House will indulge me, sir, at this late hour, I will make a few remarks upon the subject before it. I candidly confess I have been all along savorable to the issuing of these (Treasury) notes, without interest, or
bearing very small interest—two or three per cent. at the outside—because I thought they would answer, and answer very effectually, the double purpose of relieving the Government, and relieving, in almost an equal degree, the great body of the people. I have no dread at all of such an issue leading to a system of paper money, as has been said here and elsewhere. For one I go for no such system. I do not claim for the Government the right, under the constitution, of furnishing a circulating medium, as such, to the community. But there is no such power involved in the amendment on your table, or in that modification of it to which I have just alluded, and which I greatly prefer. It is one of the simplest and most usual forms of borrowing money, within the very letter of the constitution. That power is vested in Congress without any qualification or reserve whatever, as to the manner in which it shall be exercised. By what authority—with what color of plausibility, can gentlemen pretend to say to us, you may borrow thus, but not thus—this form of loan is legal, that an unheard of and flagrant usurpation ? Can it be pretended that the founders of this Government, looking forward to the infinitely diversified exigencies of a society intended to be perpetual, spreading over a country vast, almost beyond description, in extent, exposed to all the vicissitudes of peace and war, of prosperity and distress, deliberately deprived it of a means of raising money, to which it has already been forced, on a memorable occasion, to resort, and which is perfectly familiar in the practice of every Government in the civilized world; and that, too, when the power is conveyed in terms as large and coinprehensive as language can be 3 I say, sir, that this convenient form of loan, which consists chiefly in anticipating to meet casual exigencies, the current revenues of a country, is to be met with everywhere in Europe. Every body has heard of the distinction between floating and funded debt. In England there is always a large amount of exchequer bills in the market. The securities of the Bank of England consist almost exclusively of them, as combining safety and convenience in the highest possible degree. In the continental States, Treasury bonds are just as common. In short, if we were not the only people upon earth so happy as to know only by hearsay of the expedients to which, in the conduct of difficult affairs, States are everywhere compelled to resort, gentlemen would scarcely express such naive astonishment and alarm at one of the most usual of them. But I repeat it, sir, I am not committing myself to the doctrine that this Government has, under the constitution, an unlimited control over our currency, either in this or in any other form. You know, Mr. Speaker, what my opinions are upon that subject, from those generally entertained in the part of the country which I have the honor to represent. I have done too much in my humble way to sortify and to diffuse those opinions; I know too well their importance, in a Government constituted as this is, to the weaker part of the confederacy, and especially now that that weaker part seems threatened with serious aggression, to abandon them, nay, nor to bate one jot of their rigor and sternness, for the sake of a mere momentary relief and convenicnce. I admit that when this House is called upon by the Executive to issue Treasury notes, as in every other case of loan, it ought to see that the Government really wants money, and wants it too for bona fide federal (not national, as they are called, or notional) purposes. That is the restriction, sir. That is the sound practical rule from which I will never cénsent to depart; and if I did not think that it applied to our actual situation, I should oppose not only the bill on the table, but every other bill for raising supplies at the present moment. But the case presented, and, so far as I have been able to consider the matter, made out by the Executive, is that, without pressing with a most rigid and probably ruinous severity upon its
debtors, the deposite banks and the merchants; without aggravating, beyond expression, the calamitous condition of the times, it must resort to you for temporary aid—for authority to anticipate the fruits of our returning prosperity, without formally laying the foundation of a new national debt, and to create a species of loans, which will not only furnish you with the means you want, but, incidentally, relieve the embarrassments of the community, and, especially, in the great and important interests of our domestic exchanges. But, says the gentleman from Virginia before me, (Mr. Wisk,)you are turning the Government into a bank—you are creating a great political corporation to trade in money, at the very moment that you decide it to be inexpedient to charter a commercial corporation for the same purpose. Why, sir, according to this very novel definition, every debtor is a banker—it is the borrower, not the lender, that belongs to that privileged class. (A laugh.) If this is true, we are a nation of bankers, [“So you are,” from Mr. Wise]—“over-banked,” to use the common phrase, with a vengeance. But on what possible ground can such a proposition be advanced? The States, it is said, are forbidden to issue bills of credit. What are bills of credit ! Mr. Madison, as appears from one of the documents laid upon our tables, in a letter to a gentleman of some distinction in Pennsylvania, affirms, without hesitation, and as a thing quite settled, that it is of the very essence of such paper—its distinctive characteristic, its specific difference, so to speak—that it be made a legal tender. [Mr. Rob Entson, of Virginia. It has been decided otherwise. Mr. LegARE. Where, when, by whom Mr. Ronentson. By Judge Story.] (Cries of “go on, go on.”) Mr. Log Aur continuing. Sir, I will examine the correctness of that opinion presently. In the mean time, I beg leave to state to the House that Mr. Madison only repeated, in the letter alluded to, the opinions which he had previously either expressly or implicitly advanced, not casually, loosely, or inconsiderately, but in the most deliberate manner, and on the most momentous occasions. In his first message to Congress in the session of 1815–16, he goes even further than in that letter—further, as I have said, than, as at present advised, I am quite willing to follow him. He distinctly presents in that state paper, the alternative of a national bank or a Government currency. Now, sir, I feel that I owe it to the House and to truth, I owe it to my own station here and the candor which I ever feel myself obliged to practise in debate, to state that General Hamilton, in his celebrated report upon the bank in 1791, does seem to treat such Government issues as the very description of bills of credit, so notorious under the old order of things, and therefore interdicted forever to the legislation of the States. He admits, indeed, that the interdict does not apply to us, directly, but he very reasonably thinks that it at least hints a rule for the conduct of this Government, which it ought not lightly to neglect. To take up the matter on principle it might well be asked, what harm is done by the issue of paper which nobody is obliged to receive, and every body may profitably use, in payment of public dues 1 But even if you allow, as I will not undertake to deny, that a mere issue of currency, as such, comes within the prohibition—what do you mean by currency! Is it pretended, for example, that the States, with their vast residuum of political power and public duty, cannot borrow money, and give to their creditors the evidence of debt assignable or unassignable ! And if these evidences or acknowledgments of debt pass—as pass in these times of active commerce they inevitably will—from hand to hand, do they become violations of the constitution for that Sir, it is a false, wild, chimerical conceit that such a notion ever entered into the heads of the majority of
the convention in 1788, or that kindred idea, so often uttered of late, that all banking corporations in the different States, mere private partnerships chartered by the Legislatures, fall virtually within the prohibitory clause. It seems to me nothing short of monstrous to imagine that the States, charged as they are with all the high obligations of civil society—of defence and protection, of police, of education, of justice—with almost every thing that relates to the order and well-being of a community, could have thought, for a moment, of depriving themselves of a resource without which, in modern times, no free commonwealth can possibly manage its affairs without often falling into the most perplexing and even perilous embarrassments. And what is the argument by which it is attempted to lay them under such a disability ? Why, that Congress, having the power to coin money and regulate the value thereof, was intended to have a complete control over the currency! Now what is currency, or rather, what, in these times, is not? Where will you draw any practical line between one acknowledgment of debt—one bill of credit, if you please— and another, when in all their effects, commercial and political, they are evidently the same 4 Sir, having bestowed much thought and research upon this most difficult and important of all the subjects that now challenge the attention of a public man, with opportunities perhaps more savorable to the discovery of truth, and to the forming of correct conclusions for the conduct of affairs, than it has fallen to the lot of most persons to enjoy, and finding, after so many nights and days of patient inquiry, the difficulties which surround this subject almost as many and (to me) as formidable as ever, I have been filled with wonder since I came here at the confident and dogmatical tone of many persons (on all sides) whose conclusions have cost them far less pains, and been adopted without any such loss of time. Among other things coolly taken for granted, is the meaning of this word “currency.” Now, sir, if gentlemen will be at the trouble of looking into the minutes of evidence taken before the committee of the House of Commons charged with the question of the renewal of the bank charter in 1832, they will find that, with the exception of small sums paid away in wages, the whole circulating medium of Lancashire, Warwickshire, the West Riding of Yorkshire, and other, if not all, of the great manufacturing districts of England, consisted at no remote period exclusively of bills of exchange.” The whole circulation, I say, in which the immense business of the most flourishing manufacturing and commercial empire in the world is transacted—and especially that part of its trade which has done so much to enrich both this country and England— is almost entirely composed of common mercantile paper, with which Government, according to the opinions of our people and the genius of our institutions, has, by the confession of all men, nothing whatever to do. Sir, I shall have, I trust, some future and better opportunity of going more at large into that subject, which has, for some time past, so deeply engaged, and I am sorry to have to add, agitated the minds of men in all parts of the United States— I mean the credit system, under which this nation has grown up to be what it is. But I could not but take this
* No.4206. Mr. Dyer. “By circulation, I mean not merely local notes, but bills of exchange.”
No. 4274. The same. “To deny the Lancashire banks to be banks of issue, because they issue only post notes, is to make a distinction without a difference ''
It is stated in No. 4361, that the banks of Lancashire, at that title, did not issue notes, properly so called, but drafts, at different dates up to three months, upon their agents in London. In 1825, and other times of excitement, they were circulated to an immense amount, and did as much mischief by an enlarged currency of paper as was done in other parts of England by notes.
So No. 5329, ibid. “Bills of exchange form at present (1832) the great currency of Lancashire, and they formed almost the exclusive currency, with the exception of small notes paid for wages, till within these last seven years”—[1825 to 1832.]
Then §. the statement that nine-tenths of all the business of the counties mentioned above are represented by small bills.
occasion to remark how very loosely, with what a dangerous latitude both of phrase and opinion, we are in the habit of treating these matters, involving as they do all the fundamental interésts of society, and of exemplifying the remark in the use of one of the most familiar terms that occur in our debates and declamations. We talk of bank paper as if all the harm done by expansions of currency were owing to it alone. Why, sir, bank notes, even in the times of the most extravagant issues, are but a part, and even a very small part, of the circulation set in motion by the operation of the credit system, at a period of great excitement, in communities advanced in civilization, and having all the facilities of an extended commerce. They are the efflorescence—so to express it—the flower, the blossom of the currency of such a country, essential, I admit, to its perfection and fruitfulness, but no more the whole body and frame of that mighty tree, than that eastern portico is te this capitol. But it is not my purpose to go, at this time, into the consideration of this subject in all its bearings and extent, and I have said already enough to awaken the House to the danger of those loose and sweeping generalities in which it is become so much the habit, in this country, to deal, even in the most important practical concerns. As to the constitutional power of Congress, then, to issue these notes, under existing circumstances, I entertain no doubt at all, at least with reference to the objections mainly relied on in this discussion, and especially by the gentlemen over the way, [Messrs. Fletch ER, Phillips, and CushING, of Massachusetts.] But to the issuing them without interest, or with a very small interest, for which I repeat my decided preference, another difficulty has been presented by my friend from Virginia near me, [Mr. Ron Entson.] He maintained that as the constitution forbids any thing but gold and silver to be made a legal tender by the States, it implicitly requires that we should pay the debts of this Government only in specie or in what is equivalent to it. And yet, in almost the same breath, the gentleman proceeded to denounce the Executive for not being satisfied with the bank notes of the States, which he maintained are really not all depreciated. Sir, on this last head I agree with him entirely, at least so far as regards the state of our paper currency in the Southern States. I maintained when I first came here, what has been since demonstrated in a masterly argument in another part of this building," and is strikingly corroborated by the recent fall in exchanges, that the price of bullion had been raised by an extraordinary foreign demand, and was no proof whatever of the redundancy of the circulation, which has been very much reduced within the last ten months, and is probably even inadequate to the necessary exchanges of the country, in the usual course of business. But if this is true, as I ilave no doubt it is, then the right of a creditor under the constitution to demand specie for his debt, becomes that summum jus which, all the world over, is summa injuria. And if this is the case as between individuals, why should a rule so very different be applied to the transactions of Government Nay, the news brought us from New York this morning is that, while gold is only at 5 per cent. premium, Treasury drafts are at 4: for you must remark, sir, that the letter of Prime, Ward, & Co., received just now, is dated at least a fortnight ago, and since that time a most decided change has taken place in the specie market as well as in foreign bills. I think, then, I am perfectly safe in af. firming that there is no danger whatever of the contemplated Treasury notes falling below what, by the confession of the gentleman himself, ought to satisfy any man not bent upon enforcing a contract according to the utmost rigor of the law, in a manner inconsistent with equity and good conscience. We shall pay our creditors in what is 4 per cent. above those bank notes which are there
* By Mr. King, of Georgia.
acknowledged to be at their full value in reference to all other commodities but gold and silver. [Here Mr. Rob Entson said nothing was at par which was not equivalent to gold and silver, or something to that effect.] Mr. LEGARE. Then why find so much fault with the Government for demanding gold and silver of its debtors' The gentleman is plainly in a dilemma, from which it is not easy for him to extricate himself. [Mr. Rob Entson said, with the permission of the gentleman from South Carolina, he would make a brief explanation. He had not at all discussed the question of depreciation. He could not admit, however, that paper money was not depreciated. On the contrary, he insisted that it must always be regarded, in a legal sense, as depreciated when below the legal standard—gold and silver, without regard to the causes, whether it be a foreign demand or any other, which may have occasioned the difference. Still he denied the policy or justice of exacting gold and silver at this time in payment of the public dues; when it could not be procured but at a high premium, and when, indeed, there was scarcely any currency at the command of the people than depreciated paper. He thought it was oppressive in this Government to exact this sacrifice—to reject that which the State Governments were content to receive ; and what, in the ordinary transactions between man and man, it would be deemed immoral and dishonorable to refuse.] Sir, I am charmed to hear the gentleman say so. Then why should the public creditor call upon the Government to do, for his benefit, an immoral and dishonorable thing ; and why should he think himself wronged if we offer him what is at this moment four per cent. better than the paper which, according to the gentleman's own showing, ought to satisfy every equitable and conscientious man But the truth is, I apprehend no difficulty at all from those to whom we shall have payments to make, and through whose hands these notes will, almost without exception, make their way into circulation. They will receive them cheerfully, and without hesitation; and although I perfectly appreciate the delicate and honorable scruples which some gentlemen seem to feel about offering, in satisfaction of the public dues, a paper ever so little inferior to the only legal tender recogmised in the constitution, yet I cannot myself, in a matter left, after all, entirely to the free will of the party, consent to sacrifice substantial justice and the public good to what I must consider as a superstitious adherence to the mere letter of the law. Nobody, at all versed in these subjects, now regards the precious metals as any thing but an approximation, and often a very imperfect approximation, to a correct measure of value. They have been adopted from the necessity of the thing, as the two great “commodities of commerce” furnishing a ready medium of exchange for all others, and, on the whole, the best practical means of comparing them; but they are still, like the rest, mere commodities, subject to a very great fluctuation in value, according to the common principles which govern prices. The present state of things furnishes, in my opinion, a striking example of this important truth ; and now, I ask, whether any really just man ought to complain of us if we offer him these notes, with the most perfect liberty to refuse them at his own discretion, and treat us as debtors on his unsettled account; if, in making that offer, we hold to him the frank, manly, and reasonable language dictated to us by the truth of the case, and the actual situation of the country—if we say to him “gold and silver, which is in strict law, though not in good conscience, your due, we have none By an unforeseen and terrible revulsion, by contingencies beyond any human control, our debtors have been, and are still, unable to meet their engagements with us in the usual way. The country is in deep embarrassment and distress, and we cannot, even were we disposed