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My remembrance of the events of 1838 is not exact, and I have not now access to papers that might refresh it. In answer to your questions I can, however, speak as follows:
1. You had no agency in procuring the appointment which, as Speaker, I made of you to be chairman of the Committee of Ways and Means, beyond such agency as is involved in the opinion from previous acquaintances with you I had formed of your fitness for the place. The particular reasons why, in considering what was best for the public interest, with due regard to the rights of individuals, I determined to put you at the head of this committee, and another gentleman, now deceased, at the head of the Military Committee, it is impossible for me to recollect. I am sure that no feeling of unfriendliness towards that gentleman, or towards the Bank of the State, or any of its officers, had any influence in the matter.
2 and 3. Nor had you any more direct agency in your being appointed upon the committee to investigate the bank. I have no distinct remembrance that after your appointment on this committee you brought to my notice the circumstance that you were a director in another bank, and that my reply was: "That circumstance is rather in favor of than against the appointment." Yet this matter does not strike me as new, and I recall something either of the original occurrence or of subsequent conversations about it. I am satisfied that I knew you were a director of the Planters' and Mechanics' Bank; and I think it not at all unlikely that I made the reply which has been mentioned, for it is consistent with the opinions I entertained. I believed that the bank was, in the main, well managed, and that its interest would be promoted by searching investigation. I felt that any mismanagement ought to be detected and exposed. I believed, too, that the considerations which demanded publicity to be given to the pecuniary transactions of the State were superior to, if in conflict with those which were said to require secrecy with regard to the business of banking, in which the State was engaged, and that the best committee-man for investigation was one who was predisposed to blame rather than commend; but intelligent, temperate, and fair enough to perceive and acknowledge the truth. Your prominence in the House, thorough acquaintance with the financial affairs of the State, proximity to the principal bank, business habits, clear-headedness, and candor, induced my selection of you. The experience in banking accounts and transactions, which, as director of another bank, you might be supposed to have acquired, I thought increased your qualifications. To any suggestions of unfair practices which adverse interest might lead to, my opinion of your integrity would, in your case, have given no heed; but in the case of any known enemy of the bank, according to my opinion, there was but little ground for apprehending harm to come to the bank in the proper course of its operations from his investigations. And the objections on this score seemed to me
no greater against a director than against a stockholder of another bank, or even any person connected with another institution in any of the various ways that might induce a preference of its interests to those of this bank; and no greater against a director of another bank examining this, than against a director of this being transferred to another bank.
4. Concerning the bill to authorize a subscription in behalf of the State to the Southwestern Railroad Bank, I remember no conversation between you and myself, but I recollect the following particulars:
A great effort was necessary, and was made to induce a majority of the House to confirm the subscription which Governor Butler had made. After the assent of the House to the main proposition had been obtained, an attempt was made to add to the clause, which required the bank to pay the instalments of the subscription, a proviso that if the president and directors of the bank should be of opinion that they could not pay without embarrassment to the operations of the bank, or, without involving the faith of the State pledged for redemption of State stocks by the act of 1821, and subsequent acts, then the Comptroller-General should issue stocks to pay the instalments of the subscription. The proviso was rejected in the House, and the bill passed a second reading, I voting for it on the call of the ayes and noes. The bill was returned from the Senate with the proviso in it; and thus altered, it passed a third reading in the House. As the ayes and noes were not then called, and no opportunity had been afforded to me of making known the change which the insertion of the proviso had produced in my disposition towards the bill, after I had announced that the bill was again ordered to the Senate, I said, by leave of the House, that I felt it due to myself, to prevent misconstructions of my opinion, by declaring that, if the ayes and noes had been called on the bill as amended, I would have voted against it.
I had then a decided opinion that it was better for the State to make no subscription-even to let the establishment of the Southwestern Railroad Bank fail-than to borrow money for banking. To the substance of the alternative measure, authorized by the proviso, I was then strongly opposed, and the form, too, seemed to me objectionable. Besides that, a result was attained which had not been contemplated by the especial friends of the bill; the proviso, I thought, exhibited a studied array of pledges that might embarrass the State in future dealings with its funds; and, moreover, erected the president and directors of the bank into a tribunal to decide what the faith of the State required. It was said in debate that the proviso was only a measure of extreme caution, intended to guard against unforeseen contingencies, but I thought that I had seen, in the course of the transaction, evidences that it would be made available if it passed.
With great respect, yours truly,
C. G. Memminger, Esq.
D. L. WARDlaw.
[For The Mercury.]
Messrs. Editors,-In your paper of yesterday Colonel Elmore alludes to a certificate which I had furnished Mr. Memminger, respecting the appointment of the committees of examination for the Bank of the State of South Carolina and its branches in 1838, and my remarks which accompanied the certificate.
It is proper to state that Mr. Memminger applied to me to know how the committees were appointed at the annual session of 1838 and if he had had any agency in the appointment. When he wrote I had only the rough journal of that year before me, without an index, and finding that the appointment was made on a concurrence by the House with a message from the Senate, it did not occur to me to look further, nor had I any recollection that a resolution was also introduced for that purpose. I did not speak from memory, but from that portion of the proceedings then before me, and in that I was correct. It is no doubt true, as Col. Elmore states, that Mr. Memminger before submitted a resolution on the subject, but the action of the IIouse on the message from the Senate superseded the necessity of considering Mr. Memminger's resolution, and the appointment of the committees was certainly not made on that resolution, nor, as far as I know, by the agency of Mr. Memminger. How far the fact that he had submitted such a resolution influenced the Speaker in the appointment of the committees I have no means of knowing. Very respectfully,
March 6th, 1850.
T. W. GLOVer.
The following is the summing up of the whole matter, and presents clearly the reasons why he opposed with such earnestness the re-chartering of the bank.
To the People of St. Philip's and St. Michael's Parishes:
FELLOW-CITIZENS,-I propose now to sum up the various matters which I have submitted to your consideration.
I have endeavored to satisfy your judgments that the Bank of the State ought not to be re-chartered, for the following reasons:
1. Because it is an institution not consistent with the character of popular governments-inasmuch as it is so complex in its machinery and relations that few can spare the time and attention necessary to understand them.
2. Because it is unconstitutional, and can only be judiciously sustained by the same evasion of the Constitution of the United States by which a protective tariff is sustained.
3. Because its charter violates the spirit of our State Constitution, in the following particulars:
1. In that it confers on a body of thirteen men, sitting in secret, and bound to each other by an oath of secrecy, the power to appropriate, at pleasure, the public money; when, by the Constitution of the State, no such appropriation can be made but by an act of the Legislature, which must first be read three times in the Senate and three times in the House of Representatives, on three successive days, before it can become a law; and, as a further security, the Constitution requires each House to keep a journal of its proceedings and to record the yeas and nays for public information; while the proceedings of the bank are performed secretly and studiously concealed from the public eye.
II. The State Constitution gives to the Legislature alone the power to tax the people, and guards this power with so much jealousy as not even to permit the Senate to originate a tax bill, whereas the bank directors have power at any moment, by a mere order issued in secret, to tax the people to the extent of millions by contracting debts or issuing notes, which the people are bound to pay.
III. Because the State Constitution require the treasurers of the people's treasury to go out of office every four years so that their accounts may be passed upon by successors, whereas the bank officers, who hold ten times as much of the public money, and have in their hands all the treasury of the State, continue in office for a life-time.
IV. Because the State Constitution confines the legislative authority of South Carolina to the General Assembly alone, whereas the board of bank directors, sitting in secret, have undertaken to exercise many of the most responsible functions of the Legislature; such as subscribing to and patronizing railroad companies, banks, and manufacturing corporations, without any public discussion and without its even being known to the public by whom, or for what reasons these acts of the bank legislature have been passed.
4. Because this State has, with an almost unanimous voice, repeatedly condemned the connection of bank and State as unwise and inexpedient, and as involving the public revenues in all the casualties of banking; and because the extension of this system to the borrowing of money upon the public faith, to lend out to individuals by bank accommodation-as has been done for this bank-is fraught with still more disastrous consequences to the public.
5. Because the tendency of such a bank is to mislead and swerve from their duty, not only its own officers, but the public authorities themselves, by the influence it exerts over them; and if the president of the bank be a politician, it gives a master to the State.
6. Because the experience of the Bank of the United States, of the Alabama and other State banks has proved all banking institutions which are connected with governments to be uniformly injurious to the public interests.
7. Because the history of our own bank is fraught with similar lessons. It has, on every occasion in which its interests or wishes are concerned, from the fire loan down to the present time, swerved the State from her true policy, plunged her into debt, and involved her in complicated and embarrassing transactions, with which she would otherwise have had no connection.
8. Because the power exercised by the bank directors to issue bills and other obligations, which the people are pledged to redeem, and the distribution of the money thus raised among the bank directors and their friends, is a partial system of favoritism in which each citizen of the State is virtually converted into an indorser of the notes of a favored few, whether the citizen will or no.
These reasons having clearly established that the bank ought not to be re-chartered, I then proceeded to examine the objections urged by the friends of the bank against any interference with it.
I. First objection: The chief of these was, that the pledge of the funds of the State and of the profits of the bank to the foreign creditor under the fire-loan act, stood in our way.
To this, it was answered, that we did not propose to remove any of the funds of the State from the obligation imposed upon them. They. were to be preserved for the foreign creditor until his debt should be paid. Whether the funds were in the hands of a bank, or any other agent, they were equally the funds of the State and equally secured to the foreign creditor his debt.
II. It was answered, that a pledge of the funds of the State did not prevent a change of investment any more than when trust funds are invested for a private trust; otherwise, all the substitutions of railroad stocks in the upper country, which the State had lately made for its South Carolina railroad bonds and stock, were unlawful.
III. It was answered, that as to the bank itself the creditor when he loaned his money, had before him the bank charter, which on its face declared that the charter would expire in 1856; and he had, therefore, no right to count on its existence beyond that time.
IV. It was answered, that so far as the profits were concerned, the creditor would be benefited by discontinuing the bank, inasmuch as the returns of the bank itself showed that during the last ten years the average profit on the capital was less than six per cent. per annum; whereas the money loaned out without any banking risk would bring seven per cent.
Second objection: That this was a bank for the accommodation of planters; and to destroy it would be injurious to the agricultural community. This objection was answered by showing that the officers and directors of the bank itself had among them $1,091,118-which left of the actual capital of the bank only $31,344 for all the rest of the State.