Recent evils have not at all surprised me, except that they have come sooner and faster than I had anticipated. But, though not surprised, I am afflicted; I feel any thing but pleasure in this early fulfilment of my own predictions. Much injury is done, which the wisest future counsels can never repair, and much more that can never be remedied but by such counsels and by the lapse of time. From 1832 to the present moment, I have foreseen this result. I may safely say I have foreseen it, because I have foretold and proclaimed its approach in every important discussion and debate in the public body of which I am a member. In 1832, I happened to meet with a citizen of Wheeling, now present, who has this day reminded me of what I then anticipated, as the result of the measures which the administration appeared to be adopting in regard to the currency. In the summer of the next year, 1833, I was here, and suggested to friends what I knew to be resolved upon by the executive, namely, the removal of the deposits of the public funds from the Bank of the United States, which was announced two months afterwards. That was the avowed and declared commencement of the “experiment.” You know, Gentlemen, the obloquy then and since cast upon those of us who opposed this “experiment.” You know that we have been called bank agents, bank advocates, bank hirelings. You know that it has been a thousand times said, that the experiment worked admirably, that nothing could do better, that it was the highest possible evidence of the political wisdom and sagacity of its contrivers, and that none opposed it or doubted its efficiency but the wicked or the stupid. Well, Gentlemen, here is the end, if this is the end, of this notable “experiment.” Its singular wisdom 385 has come to this; its fine workings have wrought out an almost general bankruptcy.
Its lofty promises, its grandeur, its flashes, that threw other men’s sense and understanding back into the shade, where are they now? Here is the “fine of fines and the recovery of recoveries.” Its panics, its scoffs, its jeers, its jests, its gibes at all former experience,—its cry of “a new policy,” which was so much to delight and astonish mankind,—to this conclusion has it come at last.
“But yesterday, it might
Have stood against the world; now lies it there,
And none so poor to do it reverence!”
It is with no feelings of boasting or triumph, it is with no disposition to arrogate superior wisdom or discernment, but it is with mortification, with humiliation, with unaffected grief and affliction, that I contemplate the condition of difficulty and distress to which this country, so vigorous, so great, so enterprising, and so rich in internal wealth, has been brought by the policy of her government.
We learn to-day that most of the Eastern banks have stopped payment, the deposit banks as well as others. The experiment has exploded. That bubble, which so many of us have all along regarded as the offspring of conceit, presumption, and political quackery, has burst. A general suspension of payment must be the result; a result which has come even sooner than was predicted. Where is now that better currency that was promised? Where is that specie circulation? Where are those rivers of gold and silver, which were to fill the treasury of the government as well as the pockets of the people? Has the government a single hard dollar? Has the treasury any thing in the world but credit and deposits in banks that have already suspended payment? How are public creditors now to be paid in specie? How are the deposits, which the law requires to be made with the States on the 1st of July, now to be made? We must go back to the beginning, and take a new start. Every step in our financial banking system, since 1832, has been a false step; it has been a step which has conducted us farther and farther from the path of safety.
The discontinuance of the national bank, the illegal removal of the deposits, the accumulation of the public revenue in 386 banks selected by the executive, and for a long time subject to no legal regulation or restraint, and finally the unauthorized and illegal treasury order, have brought us where we are. The destruction of the national bank was the signal for the creation of an unprecedented number of new State banks, often with nominal capitals, out of all proportion to the business of the quarters where they were established. These banks, lying under no restraint from the general government or any of its institutions, issued paper money corresponding to their own sense of their immediate interests and hopes of gain. The deposit with the State banks of the whole public revenue, then accumulated to a vast amount, and making this deposit without any legal restraint or control whatever, increased both the power and disposition of these banks for extensive issues. In this way the government seems to have administered every possible provocation to the banks to induce them to extend their circulation. It uniformly, zealously, and successfully opposed the land bill, a most useful measure, by which accumulation in the treasury would have been prevented; and, as if it desired and sought this accumulation, it finally resisted, with all its power, the deposit among the States. It is urged as a reason for the present overthrow, that an extraordinary spirit of speculation has gone abroad, and has been manifested particularly and strongly in the endeavor to purchase the public lands; but has not every act of the government directly encouraged this spirit? It accumulated revenue which it did not need, all of which is left in the deposit banks. The banks had money to lend, and there were enough who were ready to borrow, for the purpose of purchasing the public lands at government prices. The public treasury was thus made the great and efficient means of effecting those purchases which have since been so much denounced as extravagant speculation and extensive monopoly. These purchasers borrowed the public money; they used the public money to buy the public property; they speculated on the strength of the public money; and while all this was going on, and every man saw it, the administration resisted, to the utmost of its power, every attempt to withdraw this money from the banks and from the hands of those speculators, and distribute it among the people to whom it belonged.
If, then, there has been over-trading, the government has 387 encouraged it; if there have been rash speculations in the public lands, the government has furnished the means out of the treasury. These unprecedented sales of the public domain were boasted of as proofs of a happy state of things, and of a wise administration of the government, down to the moment when Congress, in opposition to executive wishes, passed the distribution law, thus withdrawing the surplus revenue from the deposit banks. The success of that measure compelled a change in the executive policy, as the accumulation of a vast amount of money in the treasury was no longer desirable. This is the most favorable motive to which I can ascribe the treasury order of July. It is now said that that order was issued for the purpose of enforcing a strict execution of the law which forbids the allowance of credits upon purchases of the public lands; but there was no such credit allowed before; not an hour was given beyond the time of sale. In this respect, the order produces no difference whatever. Its only effect is to require an immediate payment in specie, whereas, before, an immediate payment in the bills of specie-paying banks was demanded. There is no more credit in the one case than in the other; and the government gets just as much specie in one case as in the other; for no sooner is the specie, which the purchaser is compelled to procure, often at great charge, paid to the receiver, than it is sent to the deposit banks, and the government has credit for it on the books of the bank; but the specie itself is again sold by the bank, or disposed of as it sees fit. It is evident that the government gets nothing by all this, though the purchasers of small tracts are put to great trouble and expense. No one gains any thing but the banks and the brokers. It is, moreover, most true that the art of man could not have devised a plan more effectually to give to the large purchasers or speculators a decided preference and advantage over small purchasers, who bought for actual settlement, than the treasury order of July, 1836. The stoppage of the banks, however, has now placed the actual settler in a still more unfortunate situation. How is he to obtain money to pay for his quarter-section? He must travel three or four times as many miles for it as he has dollars to pay, even if he should be able to obtain it at the end of that journey.
I will not say that other causes, at home and abroad, have not had an agency in bringing about the present derangement. 388 I know that credits have been used beyond all former example. It is probable the spirit of trade has been too highly excited, and that the pursuit of business may have been pressed too fast and too far. All this I am ready to admit. But instead of doing any thing to abate this tendency, the government has been the prime instrument of fostering and encouraging it. It has parted voluntarily, and by advice, with all control over the actual currency of the country. It has given a free and full scope to the spirit of banking; it has aided the spirit of speculation with the public treasures; and it has done all this, in the midst of loud-sounding promises of an exclusive specie medium, and a professed detestation of all banking institutions.