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with the States might be paid by the funds in the banks; there are large sums on deposit in some of the States, and an arrangement might be made for the States to receive the notes of their own banks in payment of this instalment, while the Treasury is at the same time relieved by its own measure, and all the inconvenience, disappointment, and disturbance which this bill will necessarily create, would be avoided. At any rate, the payment of this deposit could do no more than in some measure to increase the amount of Treasury notes necessary to be issued; it is a question of quantity merely. Much of the instalment, I believe, might be paid by judicious arrangements, out of those funds now in the banks, which the Secretary cannot use for other purposes, so that the whole might be provided for, by no great augmentation of the proposed amount of Treasury notes. I am, therefore, of opinion that this instalment should not be withheld: 1st. Because the withholding of it will produce great inconvenience to the States and to the people. 2d. Because provision may be made for paying it without any large addition to the sum which it is proposed to raise, and which, at all events, must be raised for the uses of the Treasury.
In relation to the general subjects of the Message, there is one thing which I intended to have said, but have omitted; it is this. We have seen the declaration of the President, in which he says that he refrains from suggesting any specific plan for the regulation of the exchanges of the country, and for relieving mercantile embarrassments, or for interfering with the ordinary operation of foreign or domestic commerce; and that he does this from a conviction that such measures are not within the constitutional province of the General Government; and yet he has made a recommendation to Congress which appears to me to be very remarkable; and it is of a measure which he thinks may prove a salutary remedy against a depreciated paper currency. This measure is neither more nor less than a bankrupt law against corporations and other bankers.
Now, Mr. President, it is certainly true that the Constitution authorizes Congress to establish uniform rules on the subject of bankruptcies; but it is equally true, and abundantly manifest, that this power was not granted with any reference to currency questions. It is a general power a power to make uniform rules on the subject. How is it possible that such a power can be fairly exercised by seizing on corporations and bankers, but excluding all the other usual subjects of bankrupt laws? Besides, do such laws ordinarily extend to corporations at all? But suppose they might be so extended, by a bankrupt law enacted for the usual purposes contemplated by such laws; how can a law be defended which embraces them and bankers alone? I should like to hear what the learned gentleman at the head of the Judiciary Committee, to whom the subject is referred, has to say upon it.
How does the President's suggestion conform to his notions of the Constitution? The object of bankrupt laws, sir, has no relation to currency. It is simply to distribute the effects of insolvent debtors among their creditors; and I must say, it strikes me that it would be a great perversion of the power conferred on Congress, to exercise it upon corporations and bankers, with the leading and primary object of remedying a depreciated paper currency.
And this appears the more extraordinary, inasmuch as the President is of opinion that the general subject of the currency is not within our province. Bankruptcy, in its common and just meaning, is within our province. Currency, says the Message, is not. But we have a bankruptcy power in the Constitution, and we will use this power, not for bankruptcy, indeed, but for currency. This, I confess, sir, appears to me to be the short statement of the matter. I would not do the Message, or its author, any intentional injustice, nor create any apparent, where there was not a real, inconsistency; but I declare, in all sincerity, that I cannot reconcile the proposed use of the bankrupt power with those opinions of the Message which respect the authority of Congress over the currency of the country.
Mr. WEBSTER said, in reply, if the Act of 1815 authorized the issuing of Treasury notes, no circulation was ever made of such notes as the Secretary now recommends. All Treasury notes went on the ground of a temporary loan to the Government, to be paid or funded as soon as the Treasury would allow.
The member from New York (Mr. WRIGHT) had said that the question before the Senate was a simple proposition, whether they should borrow money to be safely kept with the States. By him, and by others, it had also been represented as a question, whether they should borrow money to give away. Nobody, Mr. W. thought, would borrow money merely to give away, or deposit for safe-keeping. But he would put it to the honorable member, if any Government had made a contract, or excited an expectation, that a deposit would be made, and the other party had acted on the faith of this assurance, and had nearly completed their arrangements, whether it ought not to supply the means, even if it did not, at the time, possess them. And suppose it was the promise of a gift, instead of a deposit, might it not be found more just to borrow, than to defeat the expectation on which the other party had acted? What was the object of this bill? It was not to repeal, but to postpone what was hereafter to be fulfilled. Such being the case, it was doubtful whether it could ever be transferred to the States with more convenience than it could now from the banks.
During the late war there was great want of money, and a great disposition to use Treasury notes, and pass them as a medium of payment to the public creditors. But in the difficulties and embarrassments of a foreign war, things were done, which, in a day of peace and abundance, we should be slow to do. And one thing which we should be slow to do was, to propose by law that we should pay the public creditors any thing less in value than gold and silver, on the condition that the creditors would voluntarily take it. The Secretary had said that the protested checks now in circulation were only a little depreciated below the value of specie, and argues that these notes will be as good at least as the protested checks. But suppose these notes should be depreciated only a little below the value of silver; was it proposed that they should be offered to the public creditors, if they would receive them? What was meant when it was said that the officers of the Government may pay its creditors in Treasury notes, if they will voluntarily receive them? What was the alternative? Were the gold and silver held in one hand, and the Treasury notes in the other? On the contrary, it was a sort of forced payment, not as good as was required by law. All knew there was no choice. The men who labored in the streets of this city, on the public works, or who furnished the bricks and stones, would come for their pay, and they would be offered Treasury notes, and asked if they were willing to take them. But would there be gold and silver in the other hand? No; nothing but the Treasury notes, and they would be asked if they were willing to take them; and then, if they should take them, that is called voluntary reception.
Now, it is evident that in such a case the only choice is between Treasury notes, on the one hand, and something worse, or nothing at all, on the other. No man can be supposed to receive voluntarily any thing of less value than that which he is legally entitled to. The reception of such inferior medium is always the result of force or necessity, either greater or smaller. Neither the justice nor the dignity of the Government could ever allow of such a course. If Treasury notes were offered to the public creditor, there ought to be an actual choice afforded between them and the specie. And especially, with what an aspect could this Government offer such payment, at the very moment when, with a stern countenance and iron hand, it was demanding of its creditors metallic money for every dollar of its dues? Was it not now the law that no officer of the Government should offer the public creditor any thing less in value than specie? Mr. W. thought, therefore, that the notes proposed by the committee were better than those recommended by the Secretary. He was in favor of that system which would put the public creditor in no such selection as between paper and nothing.
In answer to Mr. BUCHANAN,
Mr. WEBSTER, having obtained and examined the act of 1815, said: The honorable member from Pennsylvania has been kind enough to say that I do not often get into difficulties in debate, and that when I do, I generally extricate myself better than I have done on the present occasion. He partakes in the supposed triumph of his friend from New York, (Mr. WRIGHT,) in having proved me incorrect when I said that this Government had never issued such paper money as the Secretary has now recommended. Now, sir, although I am pleased to see the happiness which the gentleman enjoys, yet I believe I must dash it a little. Most assuredly, sir, it authorizes no such paper as is now proposed. I was persuaded it could not, as I have a pretty good recollection of the proceedings of Congress on such subjects at that time.
The law of 1815 authorized the issue of two classes of Treasury notes: 1st, such as bore no interest, but which, the very hour they were issued, might be funded in a seven per cent. stock, to be redeemed like other stocks of the Government. 2d. Treasury notes bearing an interest of five and two-fifths per cent. capable of being funded in like manner, in a six per cent. stock. These stocks were to be issued on application by any commissioner of the revenue in any State. Now, what comparison is there between either of these classes of Treasury notes and those recommended by the Secretary, which bear no interest, and for which no fixed redemption is provided?
I affirm again, therefore, sir, all that I have said, namely, that the notes recommended by the Treasury are regular paper issues, like the old emissions of Congress and the States before the adoption of the present Constitution, and that no precedent has been found for them, and I am sure none can be found, in the practice of this Government.
ON THE CURRENCY, AND ON THE NEW PLAN FOR COLLECTING AND KEEPING THE PUBLIC MONEYS. DELIVERED IN THE SENATE OF THE UNITED STATES, SEPTEMBER 28, 1837.
Mr. PRESIDENT: I am opposed to the doctrines of the Message, to the bill, and to the amendment of the member from South Carolina, [Mr. CALHOUN.] In all these, I see nothing for the relief of the country; but I do see, as I think, a question involved, the importance of which transcends all the interest of the present occasion.
It is my purpose to state that question; to present it, as well to the country as to the Senate; to show the length and breadth of it, as a question of practical politics, and in its bearing on the powers of the Government; to exhibit its importance, and to express my own opinions in regard to it.
A short recital of events and occurrences will show how this question has arisen.
The Government of the United States completed the forty-eighth year of its existence, under the present constitution, on the third day of March last. During this whole period, it has felt itself bound to take proper care of the currency of the country; and no administration has admitted this obligation more clearly or more frequently than the last. For the fulfilment of this acknowledged duty, as well as to accomplish other useful purposes, a National Bank has been maintained for forty, out of these forty-eight years. Two institutions of this kind have been created by law; one, commencing in 1791, and limited to twenty years, and expiring, therefore, in 1811; the other, commencing in 1816, with a like term of duration, and ending, therefore, in 1836. Both these institutions, each in its time, accomplished their purposes, so far as currency was concerned, to the general satisfaction of the country. But before the last bank expired, it had the misfortune to become obnoxious to the late administration. I need not, at present, speak of the causes of this hostility. My purpose only requires a statement of that fact, as an important one in the chain of occurrences. The late President's dissatisfaction of the bank was intimated in his first annual Message, that is to say, in 1829. But the bank stood very well with the country, the President's known and growing hostility notwithstand