duties on certain articles shall be paid in "cash." As to the second section of the land law of 1820, which was set forth with great formality in the exposition to which I have referred, as furnishing authority for the Secretary's order, there is not a word in it having any such tendency; not a syllable which has any application to the matter. That section simply declares, that after the first day of July, in that year, every purchaser of land at public sale shall, on the day of purchase, make a complete payment therefor; and the purchaser at private sale shall produce a receipt for the amount of the purchase money on any tract, before he shall enter the same at the land office. This is all. It does not say how the purchaser shall make complete payment, nor in what currency the purchase money shall be received. It is quite evident, therefore, that that section lends the order no support whatever.

The defence of the order, then, stands thus: The Secretary founds it upon the idea that nothing but gold and silver was ever lawfully receivable, and that the receipt of bank bills has been all along an "indulgence," against law. For this opinion he gives no

reasons.

The honorable member from Missouri rejects this doctrine: he admits the receipt of bank notes to have been lawful until made unlawful by the order itself; and insists that the Secretary's power of stopping their further receipt, arises under the law of 1816, and is an authority derived from it. But, then, the long and half-official exposition which accompanied the publication of the order has no faith in the law of 1816 as a source of power, but makes a parade of a totally and perfectly inapplicable section, out of the land law of 1820. Grounds of defence, so totally inconsistent, cannot all be sound, but they may be all unsound; and whether they be so or not, is a question which I would willingly leave to the decision of any man of good sense and honest judgment. I take leave of this part of the case for the present. I may pause at least, I hope, until those who defend the order shall be better agreed on what ground to place it.

Mr. President, the subject of the currency is so important, so delicate, and, in my judgment, surrounded, at the present moment, with so much both of difficulty and of danger, that I am desirous, before making the few observations which I intend, on the existing condition of things and its causes, to avoid all misapprehension, by a general statement of my opinions respecting that subject.

I am certainly of opinion, then, that gold and silver, at rates fixed by Congress, constitute the legal standard of value in this country; and that neither Congress nor any State has authority to establish any other standard, or to displace this. But I am also of opinion that an exclusive circulation of gold and silver is a thing absolutely impracticable; and if practicable, not at all to be desired; inasmuch

I*

as its effect would be to abolish credit, to repress the enterprise, and diminish the earnings of the industrious classes, and to produce, faster and sooner than any thing else in this country can produce, a moneyed aristocracy.

I am of opinion that a mixed currency, partly coin and partly bank notes, the notes not issued in excess, and always convertible into specie at the will of the holder, is, in the present state of society, the best practical currency-always remembering, however, that bills of exchange perform a great part of the duty of currency, and, therefore, that the state of domestic exchange is always a matter of high importance, and great actual bearing on commercial business.

I admit that a currency partly composed of bank notes has always a liability, and often a tendency, to excess; and that it requires the constant care and oversight of Government.

I am of opinion, even, that the convertibility of bank notes into gold and silver, although it be a necessary guard, is not an absolute security, against occasional excess of paper issues.

I believe even that the confining of discounts to such notes and bills as represent real transactions of purchase and sale, or to real business paper, as it is called, though generally a sufficient check, is not always so; because I believe there is sometimes such a thing as over-trading, or over-production.

ment.

What, then, it will be asked, is a sufficient check? I can only repeat what I have before said, that it is a subject which requires the constant care, watchfulness, and superintendence of GovernBut our misfortune is, that we have withdrawn all care and all superintendence from the whole subject. We have surrendered the whole matter to eight-and-twenty States and Territories. With the power of coinage, and the power and duty of regulating commerce, both external and internal, this Government has little more control over the mass of money which circulates in the country, than a foreign Government. Upon the expiration of the charter of the Bank of the United States, new banks were created by the States. Sixty or eighty millions of banking capital have thus been added to the mass, since 1832. All this it was easy to foresee it was all foreseen, and all foretold. The wonder only is, that the evil has not already become greater than it is; and it would have been greater, and we should have had such an excess as would perhaps have depreciated the currency, had it not been for the extraordinary prosperity of the country. No very great excess, I believe, has as yet in fact happened, or rather no very great excess does now exist. There are sufficient evidences, I think, of this.

In the first place, the amount of specie in the country is far greater than was ever known before, and it is not exported. In the next place, as all the banks as yet maintain their credit, and all pay specie on demand, the whole circulation is, in effect, equivalent to

a specie circulation; and the state of the foreign exchange shows that the value of our money, in the mass, is not depreciated, since it may be transferred without any loss into the currency of other countries. Our money, therefore, is as good as the money of other countries. If it had fallen below the value of money abroad, the rates of exchange would instantly show that fact. There has been, therefore, as yet, or at least there exists at present, no considerable depreciation of money. If, then, it be asked, what keeps up the value of money, in this vast and sudden expansion and increase of it, I have already given the answer which appears to me to be the true one. It is kept up by an equally vast and sudden increase in the property of the country, and in the value of that property, intrinsic as well as marketable. None of us, I think, have estimated this increase high enough, and for that reason we have all been looking for an earlier fall in prices. It seems obvious to me, that an augmentation in the value of property, far exceeding all former experience in any country, even our own, has taken place in the United States within the last few years. The public lands may furnish one instance of this rapid increase. It was estimated last session, by my honorable friend from Ohio, (Mr. EWING,) that the demands of actual settlers for lands for settlement were eight millions of acres per annum, on an average of some years. These eight millions, if taken up at Government prices at private entry, would cost ten millions of dollars. Now, partly by cultivation, but more by the continued rush of emigration, both from Europe and the Atlantic coast, the value of these ten millions in a very few years springs up to forty millions; that is to say, lands taken up at one dollar and a quarter an acre, soon become worth five dollars an acre for actual cultivation, and in intrinsic value. And it is to be remembered that these lands are alienable and salable, with as little of form and ceremony, almost, as if they were goods and chattels. Now, if we make an estimate, not merely on the eight millions of acres required for actual settlement, but on the whole quantity selected and taken up annually, we shall see something of the addition to the whole amount of property which accrues annually from the public lands. A rise has taken place, too, though less striking, in the value of other lands, in the country; and property, in goods, merchandise, products, and other forms, is rapidly auginented also, both in quantity and value, by the industry and skill of the People, and the extension and most successful use of machinery.

Another most important element in the general estimate of the progress of wealth in the country, is the wonderful annual increase of the cotton crops, and the prices which the article bears. Last year's crop reached, probably, to eighty millions of dollars. Now, most of the cotton produced in the United States is sold, once, at

least, in the country, and much of it many times. The bills drawn against it when shipped, either for Europe or the Atlantic ports, are usually cashed at the place of drawing, commonly, no doubt, by means of bank notes, or bank credits.

I put all these cases but as instances showing the increased value of property and amount of business in the country, and accounting therefore for an expansion of the circulation, without supposing great excess; since it is obvious that the circulating money of a country naturally bears a proportion to the whole mass of property, and to the number and amount of business

transactions.

But there is another cause of a less favorable character, which may have had its effect already; or, if not, is very likely to have it hereafter in augmenting the circulation of bank notes; I mean the obstruction and embarrassment of the domestic exchanges. In a proper and natural state of affairs, the place of currency, or money, is filled to a great extent by bills of exchange; and this continues to be the case so long as the rates of the exchange remain low and steady. Nobody, for example, will send bank notes or specie from New York to New Orleans, if he can buy a good bill at par, or near par. But when exchange becomes disturbed, when rates rise and fluctuate, bills cease to be able to perform this function, and then bank notes begin to be sent about from place to place, in quantities, to supply the place of bills of exchange, in payment of debts and balances. All such, and all other, derangements and distractions in the free course of domestic exchanges, necessarily produce an unnatural and considerable increase of the circulation. So far as our circulation has been, or may be, augmented by this cause, so far both the cause and the effect are to be deplored. In my opinion, we have certainly reason to fear this excess hereafter. What is to prevent it? Is it possible that so many State banks, so far apart, so unknown to each other, with no common objects, no common principles of discount, and no general regulation whatever, should act so much in concert, and upon system, as to maintain the currency of the country steady, without either unjust expansion or unnecessary contraction? I believe it is not possible. I believe many of those who insist so much on hard money circulation believe this also; and that they press their impracticable hard money notions, from a consciousness that the discontinuance of a national institution has brought the country into a condition in which it is threatened with issues of irredeemable paper.

Our present evil, however, is of a different kind. It is, indeed, somewhat novel and anomalous. With high general prosperity, good crops, generally speaking, an abundance of the precious metals, and a favorable state of foreign exchanges, men of business have yet felt, for some months, an unprecedented scarcity of money.

That is the state of things; its cause, in my opinion, is expressed in a few words: it is the derangement of internal intercourse, and internal exchange. Our difficulty is not exhaustion, but obstruction. Every body has means enough, but nobody can use his means. All the usual channels of commercial dealing are blocked up. The manufacturers of the North cannot obtain from the South the proceeds of the sales of their articles; the South finds money scarce, too, in the midst of its abundant exports.

In a country so extensive and so busy, every merchant's means become more or less dispersed, and exist in various places in the shape of debts. Exchange is the instrument, the wand, by which he reaches forth to these means wherever they are, and uses them for his immediate and daily purposes. But this instrument is broken. He can no longer touch with it his distant debt, and make that debt present money. He seeks, therefore, for expedients; borrows money, if he can, till times change; pays enormous rates of interest to maintain credit; thinks things, when at the worst, must soon change; looks for reaction, and sacrifices to capitalists, brokers, and money-lenders, the hard earnings of years, rather than fail to fulfil his commercial engagements. It is a happy and blessed hour, this, for greedy capital and grasping brokerage; an excruciating one for honest industry. The very rich grow every day richer; the laborious and industrious, every day poorer. Meantime, the highways of commercial dealing and exchanges grow more and more founderous, or are all breaking up. Specie, always most useful as the basis of a circulation, when most in repose, gets upon the move. Any time the last four months it might have happened, and many times doubtless it has happened, that steam-boats from New York, carrying specie to Boston, have passed in the Sound steam-boats from Boston carrying specie to New York. Boating and carting money backward and forward becomes the order of the day; and there are those who, the more they hear of specie, hauled and transported about from place to place, in masses, the more they flatter themselves with the idea that the country is returning rapidly to a safe and happy specie circulation!

There may be other minor causes. They are not worth enumerating. The great and immediate origin of evil is disturbance in the exchange; and, in my opinion, this disturbance has been caused by the agency of the Government itself. The fifty millions in the Treasury have been agitated by unnecessary transfers. As a large portion of this sum was to be deposited with the States at the beginning of next year, the Secretary seems to have thought it necessary to cut up, divide, and remove assigned portions of it before the time came. It is this idea of removal that has wrought the mischief. In consequence of this, money has been taken from places of active commercial business, where it was much needed,

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