VETO MESSAGES.
WASHINGTON, August 16, 1841.
To the Senate of the United States:
The bill entitled "An act to incorporate the subscribers to the Fiscal Bank of the United States," which originated in the Senate, has been considered by me with a sincere desire to conform my action in regard to it to that of the two Houses of Congress. By the Constitution it is made my duty either to approve the bill by signing it or to return it with my objections to the House in which it originated. I can not conscientiously give it my approval, and I proceed to discharge the duty required of me by the Constitution—to give my reasons for disapproving.
The power of Congress to create a national bank to operate per se over the Union has been a question of dispute from the origin of the Government. Men most justly and deservedly esteemed for their high intellectual endowments, their virtue, and their patriotism have in regard to it entertained different and conflicting opinions; Congresses have differed; the approval of one President has been followed by the disapproval of another; the people at different times have acquiesced in decisions both for and against. The country has been and still is deeply agitated by this unsettled question. It will suffice for me to say that my own opinion has been uniformly proclaimed to be against the exercise of any such power by this Government. On all suitable occasions during a period of twenty-five years the opinion thus entertained has been unreservedly expressed. I declared it in the legislature of my native State; in the House of Representatives of the United States it has been openly vindicated by me; in the Senate Chamber, in the presence and hearing of many who are at this time members of that body, it has been affirmed and reaffirmed in speeches and reports there made and by votes there recorded; in popular assemblies I have unhesitatingly announced it, and the last public declaration which I made—and that but a short time before the late Presidential election—I referred to my previously expressed opinions as being those then entertained by me. With a full knowledge of the opinions thus entertained and never concealed, I was elected by the people Vice-President of the United States. By the occurrence of a contingency provided for in the Constitution and arising under an impressive dispensation of Providence I succeeded to the Presidential office. Before entering upon the duties of that office I took an oath that I would "preserve, protect, and defend the Constitution of the United States." Entertaining the opinions alluded to and having taken this oath, the Senate and the country will see that I could not give my sanction to a measure of the character described without surrendering all claim to the respect of honorable men, all confidence on the part of the people, all self-respect, all regard for moral and religious obligations, without an observance of which no government can be prosperous and no people can be happy. It would be to commit a crime which I would not willfully commit to gain any earthly reward, and which would justly subject me to the ridicule and scorn of all virtuous men.
I deem it entirely unnecessary at this time to enter upon the reasons which have brought my mind to the convictions I feel and entertain on this subject. They have been over and over again repeated. If some of those who have preceded me in this high office have entertained and avowed different opinions, I yield all confidence that their convictions were sincere. I claim only to have the same measure meted out to myself. Without going further into the argument, I will say that in looking to the powers of this Government to collect, safely keep, and disburse the public revenue, and incidentally to regulate the commerce and exchanges, I have not been able to satisfy myself that the establishment by this Government of a bank of discount in the ordinary acceptation of that term was a necessary means or one demanded by propriety to execute those powers. What can the local discounts of the bank have to do with the collecting, safe-keeping, and disbursing of the revenue? So far as the mere discounting of paper is concerned, it is quite immaterial to this question whether the discount is obtained at a State bank or a United States bank. They are both equally local, both beginning and both ending in a local accommodation. What influence have local discounts granted by any form of bank in the regulating of the currency and the exchanges? Let the history of the late United States Bank aid us in answering this inquiry.
For several years after the establishment of that institution it dealt almost exclusively in local discounts, and during that period the country was for the most part disappointed in the consequences anticipated from its incorporation. A uniform currency was not provided, exchanges were not regulated, and little or nothing was added to the general circulation, and in 1820 its embarrassments had become so great that the directors petitioned Congress to repeal that article of the charter which made its notes receivable everywhere in payment of the public dues. It had up to that period dealt to but a very small extent in exchanges, either foreign or domestic, and as late as 1823 its operations in that line amounted to a little more than $7,000,000 per annum. A very rapid augmentation soon after occurred, and in 1833 its dealings in the exchanges amounted to upward of $100,000,000, including the sales of its own drafts; and all these immense transactions were effected without the employment of extraordinary means. The currency of the country became sound, and the negotiations in the exchanges were carried on at the lowest possible rates. The circulation was increased to more than $22,000,000 and the notes of the bank were regarded as equal to specie all over the country, thus showing almost conclusively that it was the capacity to deal in exchanges, and not in local discounts, which furnished these facilities and advantages. It may be remarked, too, that notwithstanding the immense transactions of the bank in the purchase of exchange, the losses sustained were merely nominal, while in the line of discounts the suspended debt was enormous and proved most disastrous to the bank and the country. Its power of local discount has in fact proved to be a fruitful source of favoritism and corruption, alike destructive to the public morals and to the general weal.
The capital invested in banks of discount in the United States, created by the States, at this time exceeds $350,000,000, and if the discounting of local paper could have produced any beneficial effects the United States ought to possess the soundest currency in the world; but the reverse is lamentably the fact.
Is the measure now under consideration of the objectionable character to which I have alluded? It is clearly so unless by the sixteenth fundamental article of the eleventh section it is made otherwise. That article is in the following words:
The directors of the said corporation shall establish one competent office of discount and deposit in any State in which two thousand shares shall have been subscribed or may be held, whenever, upon application of the legislature of such State, Congress may by law require the same. And the said directors may also establish one or more competent offices of discount and deposit in any Territory or District of the United States, and in any State with the assent of such State, and when established the said office or offices shall be only withdrawn or removed by the said directors prior to the expiration of this charter with the previous assent of Congress: Provided, In respect to any State which shall not, at the first session of the legislature thereof held after the passage of this act, by resolution or other usual legislative proceeding, unconditionally assent or dissent to the establishment of such office or offices within it, such assent of the said State shall be thereafter presumed: And provided, nevertheless, That whenever it shall become necessary and proper for carrying into execution any of the powers granted by the Constitution to establish an office or offices in any of the States whatever, and the establishment thereof shall be directed by law, it shall be the duty of the said directors to establish such office or offices accordingly.
It will be seen that by this clause the directors are invested with the fullest power to establish a branch in any State which has yielded its assent; and having once established such branch, it shall not afterwards be withdrawn except by order of Congress. Such assent is to be implied and to have the force and sanction of an actually expressed assent, "provided, in respect to any State which shall not, at the first session of the legislature thereof held after the passage of this act, by resolution or other usual legislative proceeding, unconditionally assent or dissent to the establishment of such office or offices within it, such assent of said State shall be thereafter presumed." The assent or dissent is to be expressed unconditionally at the first session of the legislature, by some formal legislative act; and if not so expressed its assent is to be implied, and the directors are thereupon invested with power, at such time thereafter as they may please, to establish branches, which can not afterwards be withdrawn except by resolve of Congress. No matter what may be the cause which may operate with the legislature, which either prevents it from speaking or addresses itself to its wisdom, to induce delay, its assent is to be implied. This iron rule is to give way to no circumstances; it is unbending and inflexible. It is the language of the master to the vassal; an unconditional answer is claimed forthwith, and delay, postponement, or incapacity to answer produces an implied assent which is ever after irrevocable. Many of the State elections have already taken place without any knowledge on the part of the people that such a question was to come up. The representatives may desire a submission of the question to their constituents preparatory to final action upon it, but this high privilege is denied; whatever may be the motives and views entertained by the representatives of the people to induce delay, their assent is to be presumed, and is ever afterwards binding unless their dissent shall be unconditionally expressed at their first session after the passage of this bill into a law. They may by formal resolution declare the question of assent or dissent to be undecided and postponed, and yet, in opposition to their express declaration to the contrary, their assent is to be implied. Cases innumerable might be cited to manifest the irrationality of such an inference. Let one or two in addition suffice. The popular branch of the legislature may express its dissent by an unanimous vote, and its resolution may be defeated by a tie vote of the senate, and yet the assent is to be implied. Both branches of the legislature may concur in a resolution of decided dissent, and yet the governor may exert the veto power conferred on him by the State constitution, and their legislative action be defeated, and yet the assent of the legislative authority is implied, and the directors of this contemplated institution are authorized to establish a branch or branches in such State whenever they may find it conducive to the interest of the stockholders to do so; and having once established it they can under no circumstances withdraw it except by act of Congress. The State may afterwards protest against such unjust inference, but its authority is gone. Its assent is implied by its failure or inability to act at its first session, and its voice can never afterwards be heard. To inferences so violent and, as they seem to me, irrational I can not yield my consent. No court of justice would or could sanction them without reversing all that is established in judicial proceeding by introducing presumptions at variance with fact and inferences at the expense of reason. A State in a condition of duress would be presumed to speak as an individual manacled and in prison might be presumed to be in the enjoyment of freedom. Far better to say to the States boldly and frankly, Congress wills and submission is demanded.
It may be said that the directors may not establish branches under such circumstances; but this is a question of power, and this bill invests them with full authority to do so. If the legislature of New York or Pennsylvania or any other State should be found to be in such condition as I have supposed, could there be any security furnished against such a step on the part of the directors? Nay, is it not fairly to be presumed that this proviso was introduced for the sole purpose of meeting the contingency referred to? Why else should it have been introduced? And I submit to the Senate whether it can be believed that any State would be likely to sit quietly down under such a state of things. In a great measure of public interest their patriotism may be successfully appealed to, but to infer their assent from circumstances at war with such inference I can not but regard as calculated to excite a feeling at fatal enmity with the peace and harmony of the country. I must therefore regard this clause as asserting the power to be in Congress to establish offices of discount in a State not only without its assent, but against its dissent, and so regarding it I can not sanction it. On general principles the right in Congress to prescribe terms to any State implies a superiority of power and control, deprives the transaction of all pretense to compact between them, and terminates, as we have seen, in the total abrogation of freedom of action on the part of the States. But, further, the State may express, after the most solemn form of legislation, its dissent, which may from time to time thereafter be repeated in full view of its own interest, which can never be separated from the wise and beneficent operation of this Government, and yet Congress may by virtue of the last proviso overrule its law, and upon grounds which to such State will appear to rest on a constructive necessity and propriety and nothing more. I regard the bill as asserting for Congress the right to incorporate a United States bank with power and right to establish offices of discount and deposit in the several States of this Union with or without their consent—a principle to which I have always heretofore been opposed and which can never obtain my sanction; and waiving all other considerations growing out of its other provisions, I return it to the House in which it originated with these my objections to its approval.
JOHN TYLER.
WASHINGTON, September 9, 1841.
To the House of Representatives of the United States:
It is with extreme regret that I feel myself constrained by the duty faithfully to execute the office of President of the United States and to the best of my ability to "preserve, protect, and defend the Constitution of the United States" to return to the House in which it originated the bill "to provide for the better collection, safe-keeping, and disbursement of the public revenue by means of a corporation to be styled the Fiscal Corporation of the United States," with my written objections.
In my message sent to the Senate on the 16th day of August last, returning the bill "to incorporate the subscribers to the Fiscal Bank of the United States," I distinctly declared that my own opinion had been uniformly proclaimed to be against the exercise "of the power of Congress to create a national bank to operate per se over the Union," and, entertaining that opinion, my main objection to that bill was based upon the highest moral and religious obligations of conscience and the Constitution. I readily admit that whilst the qualified veto with which the Chief Magistrate is invested should be regarded and was intended by the wise men who made it a part of the Constitution as a great conservative principle of our system, without the exercise of which on important occasions a mere representative majority might urge the Government in its legislation beyond the limits fixed by its framers or might exert its just powers too hastily or oppressively, yet it is a power which ought to be most cautiously exerted, and perhaps never except in a case eminently involving the public interest or one in which the oath of the President, acting under his convictions, both mental and moral, imperiously requires its exercise. In such a case he has no alternative. He must either exert the negative power intrusted to him by the Constitution chiefly for its own preservation, protection, and defense or commit an act of gross moral turpitude. Mere regard to the will of a majority must not in a constitutional republic like ours control this sacred and solemn duty of a sworn officer. The Constitution itself I regard and cherish as the embodied and written will of the whole people of the United States. It is their fixed and fundamental law, which they unanimously prescribe to the public functionaries, their mere trustees and servants. This their will and the law which they have given us as the rule of our action have no guard, no guaranty of preservation, protection, and defense, but the oaths which it prescribes to the public officers, the sanctity with which they shall religiously observe those oaths, and the patriotism with which the people shall shield it by their own sovereign will, which has made the Constitution supreme. It must be exerted against the will of a mere representative majority or not at all. It is alone in pursuance of that will that any measure can reach the President, and to say that because a majority in Congress have passed a bill he should therefore sanction it is to abrogate the power altogether and to render its insertion in the Constitution a work of absolute supererogation. The duty is to guard the fundamental will of the people themselves from (in this case; I admit, unintentional) change or infraction by a majority in Congress; and in that light alone do I regard the constitutional duty which I now most reluctantly discharge. Is this bill now presented for my approval or disapproval such a bill as I have already declared could not receive my sanction? Is it such a bill as calls for the exercise of the negative power under the Constitution? Does it violate the Constitution by creating a national bank to operate per se over the Union? Its title, in the first place, describes its general character. It is "an act to provide for the better collection, safe-keeping, and disbursement of the public revenue by means of a corporation to be styled the Fiscal Corporation of the United States." In style, then, it is plainly national in its character. Its powers, functions, and duties are those which pertain to the collecting, keeping, and disbursing the public revenue. The means by which these are to be exerted is a corporation to be styled the Fiscal Corporation of the United States. It is a corporation created by the Congress of the United States, in its character of a national legislature for the whole Union, to perform the fiscal purposes, meet the fiscal wants and exigencies, supply the fiscal uses, and exert the fiscal agencies of the Treasury of the United States. Such is its own description of itself. Do its provisions contradict its title? They do not. It is true that by its first section it provides that it shall be established in the District of Columbia; but the amount of its capital, the manner in which its stock is to be subscribed for and held, the persons and bodies, corporate and politic, by whom its stock may be held, the appointment of its directors and their powers and duties, its fundamental articles, especially that to establish agencies in any part of the Union, the corporate powers and business of such agencies, the prohibition of Congress to establish any other corporation with similar powers for twenty years, with express reservation in the same clause to modify or create any bank for the District of Columbia, so that the aggregate capital shall not exceed five millions, without enumerating other features which are equally distinctive and characteristic, clearly show that it can not be regarded as other than a bank of the United States, with powers seemingly more limited than have heretofore been granted to such an institution. It operates per se over the Union by virtue of the unaided and, in my view, assumed authority of Congress as a national legislature, as distinguishable from a bank created by Congress for the District of Columbia as the local legislature of the District. Every United States bank heretofore created has had power to deal in bills of exchange as well as local discounts. Both were trading privileges conferred, and both were exercised by virtue of the aforesaid power of Congress over the whole Union. The question of power remains unchanged without reference to the extent of privilege granted. If this proposed corporation is to be regarded as a local bank of the District of Columbia, invested by Congress with general powers to operate over the Union, it is obnoxious to still stronger objections. It assumes that Congress may invest a local institution with general or national powers. With the same propriety that it may do this in regard to a bank of the District of Columbia it may as to a State bank. Yet who can indulge the idea that this Government can rightfully, by making a State bank its fiscal agent, invest it with the absolute and unqualified powers conferred by this bill? When I come to look at the details of the bill, they do not recommend it strongly to my adoption. A brief notice of some of its provisions will suffice.
First. It may justify substantially a system of discounts of the most objectionable character. It is to deal in bills of exchange drawn in one State and payable in another without any restraint. The bill of exchange may have an unlimited time to run, and its renewability is nowhere guarded against. It may, in fact, assume the most objectionable form of accommodation paper. It is not required to rest on any actual, real, or substantial exchange basis. A drawer in one place becomes the accepter in another, and so in turn the accepter may become the drawer upon a mutual understanding. It may at the same time indulge in mere local discounts under the name of bills of exchange. A bill drawn at Philadelphia on Camden, N.J., at New York on a border town in New Jersey, at Cincinnati on Newport, in Kentucky, not to multiply other examples, might, for anything in this bill to restrain it, become a mere matter of local accommodation. Cities thus relatively situated would possess advantages over cities otherwise situated of so decided a character as most justly to excite dissatisfaction.
Second. There is no limit prescribed to the premium in the purchase of bills of exchange, thereby correcting none of the evils under which the community now labors, and operating most injuriously upon the agricultural States, in which the irregularities in the rates of exchange are most severely felt. Nor are these the only consequences. A resumption of specie payments by the banks of those States would be liable to indefinite postponement; for as the operation of the agencies of the interior would chiefly consist in selling bills of exchange, and the purchases could only be made in specie or the notes of banks paying specie, the State banks would either have to continue with their doors closed or exist at the mercy of this national monopoly of brokerage. Nor can it be passed over without remark that whilst the District of Columbia is made the seat of the principal bank, its citizens are excluded from all participation in any benefit it might afford by a positive prohibition on the bank from all discounting within the District.
These are some of the objections which prominently exist against the details of the bill. Others might be urged of much force, but it would be unprofitable to dwell upon them. Suffice it to add that this charter is designed to continue for twenty years without a competitor; that the defects to which I have alluded, being founded on the fundamental law of the corporation, are irrevocable, and that if the objections be well founded it would be overhazardous to pass the bill into a law.
In conclusion I take leave most respectfully to say that I have felt the most anxious solicitude to meet the wishes of Congress in the adoption of a fiscal agent which, avoiding all constitutional objections, should harmonize conflicting opinions. Actuated by this feeling, I have been ready to yield much in a spirit of conciliation to the opinions of others; and it is with great pain that I now feel compelled to differ from Congress a second time in the same session. At the commencement of this session, inclined from choice to defer to the legislative will, I submitted to Congress the propriety of adopting a fiscal agent which, without violating the Constitution, would separate the public money from the Executive control and perform the operations of the Treasury without being burdensome to the people or inconvenient or expensive to the Government. It is deeply to be regretted that this department of the Government can not upon constitutional and other grounds concur with the legislative department in this last measure proposed to attain these desirable objects. Owing to the brief space between the period of the death of my lamented predecessor and my own installation into office, I was, in fact, not left time to prepare and submit a definitive recommendation of my own in my regular message, and since my mind has been wholly occupied in a most anxious attempt to conform my action to the legislative will. In this communication I am confined by the Constitution to my objections simply to this bill, but the period of the regular session will soon arrive, when it will be my duty, under another clause of the Constitution, "to give to Congress information of the state of the Union and recommend to their consideration such measures as" I "shall judge necessary and expedient." And I most respectfully submit, in a spirit of harmony, whether the present differences of opinion should be pressed further at this time, and whether the peculiarity of my situation does not entitle me to a postponement of this subject to a more auspicious period for deliberation. The two Houses of Congress have distinguished themselves at this extraordinary session by the performance of an immense mass of labor at a season very unfavorable both to health and action, and have passed many laws which I trust will prove highly beneficial to the interests of the country and fully answer its just expectations. It has been my good fortune and pleasure to concur with them in all measures except this. And why should our difference on this alone be pushed to extremes? It is my anxious desire that it should not be. I too have been burdened with extraordinary labors of late, and I sincerely desire time for deep and deliberate reflection on this the greatest difficulty of my Administration. May we not now pause until a more favorable time, when, with the most anxious hope that the Executive and Congress may cordially unite, some measure of finance may be deliberately adopted promotive of the good of our common country?
I will take this occasion to declare that the conclusions to which I have brought myself are those of a settled conviction, founded, in my opinion, on a just view of the Constitution; that in arriving at it I have been actuated by no other motive or desire than to uphold the institutions of the country as they have come down to us from the hands of our godlike ancestors, and that I shall esteem my efforts to sustain them, even though I perish, more honorable than to win the applause of men by a sacrifice of my duty and my conscience.
JOHN TYLER.