Upon the party theory that Congress could exercise no implied power, and therefore could not charter a corporation, Crawford fell energetically, until he came in contact with the instructions of State legislatures, which he swept out of his path with actual contempt:—
“What is the inducement with these great States to put down the Bank of the United States? Their avarice combined with their love of domination!... The great commercial States are to monopolize the benefits which are to arise from the deposits of your public money. The suppression of this Bank will benefit none of the interior or smaller States in which there is little or no revenue collected. As the whole benefit is to be engrossed by three or four of the great Atlantic States, so the whole of the power which the dissolution of this Bank will take from the national government will be exclusively monopolized by the same States.”
Under Gallatin’s teaching, Crawford bade fair to make himself, what the South so greatly needed, a statesman who understood its interests; but he was far in advance of his people. The society from which he sprang was more correctly represented by Giles, who answered him in the manner for which the Virginia senator had acquired unpleasant notoriety. February 14 John Randolph, who with all his faults was not so factious as to join in the scheme of the State banks, wrote to his friend Nicholson:[271] “Giles made this morning the most unintelligible speech on the Bank of the United States that I ever heard.” Never had Giles taken more trouble to be judicial, candid, and temperate; no one could have admitted with more impartiality the force of his opponent’s arguments; but his instincts, stronger than his logic, compelled him to vote against the Bank. The conclusion was as certain as the process was vague.
Henry Clay, who followed on the same side, ironically complimented the Virginia senator, who had “certainly demonstrated to the satisfaction of all who heard him both that it was constitutional and unconstitutional, highly proper and improper, to prolong the charter of the Bank;” but Clay’s irony was as unfortunate as Giles’s logic. The sarcasm thrown at Giles recoiled on Clay himself, for he passed the rest of his life in contradicting and repenting the speech he made at this moment, in which he took ground against the power of Congress to create corporations. “The power to charter companies is not specified in the grant, and, I contend, is of a nature not transferable by mere implication. It is one of the most exalted attributes of sovereignty.” The legislation of twenty years which enforced the opposite opinion he swept aside in his peculiar manner. “This doctrine of precedents, applied to the legislature, appears to me to be fraught with the most mischievous consequences.” With more than his ordinary self-confidence, he affirmed that the Treasury could be as well conducted without as with the Bank; and he closed with a burst of rhetoric hardly to be paralleled in his oratory, by holding the Bank responsible for not preventing Great Britain from attacking the “Chesapeake,” impressing American seamen, and issuing the Orders in Council.
Clay’s excuse for extravagances like these was neither his youth nor his ignorance of affairs nor his obedience to instructions, nor yet a certain want of tact which made him through life the victim of needless mistakes, but was rather the simple repentance with which, within five years, he threw himself on the mercy of the public, admitting that had he foreseen the effect of his course he would have acted in a very different way.[272] Even for Giles some apology might be made, for no one could deny that consistency required him to vote as he did, and he could appeal to the record in his defence. The worst offender was not Giles or Clay, but Samuel Smith.
When Crawford flung so freely his charges of avarice and ambition about the Senate chamber, he had Samuel Smith directly in his eye; for Smith’s action was avowedly controlled by his interests, and since his speech on Macon’s bill his attitude toward public measures was better understood than before. No one could conceive Smith to be influenced by conscientious scruples about implied powers, but many persons besides Madison and Gallatin believed him to be selfish and grasping. Baltimore favored State banks, and Smith lent his reputation as a business man to the service of local politics and interests, except so far as in doing this he aimed at the overthrow of Gallatin. He gave what amounted to a pledge of his character as a merchant to the assertion that the State, banks were better, safer, and more efficient agencies for the Treasury than the Bank of the United States could possibly be. In making the speech which advanced these doctrines, he threw out an express challenge to Gallatin. “The secretary is considered by his friends a very great man in fiscal operations; in commercial matters I may be permitted to have opinions of my own.” As a commercial authority he asserted that government had much greater control over the State banks than over the United States Bank; that more confidence could be put in the security of the State banks than in that of the National Bank; that they could more easily effect the necessary exchanges; that they were as prudently conducted; that the National Bank did not act as a check upon them, but they acted as a check upon it; that the ordinary and extraordinary business of the Treasury could be as effectually and securely done by the State banks; and that the liquidation of the United States Bank would “be remembered nine days and not much longer.” When five years afterward the fallacy of these opinions became too notorious for question, Smith did not, like Clay, throw himself on the justice of his country or admit his errors, but he voted to re-establish the Bank in a far more extensive form, and took the ground that it was the only means of repairing mistakes which he had been a principal agent in making.
The other speeches made in this debate, although quite equal in ability to these, carried less political weight, for they implied less factiousness. One remained, which excited no small curiosity and some amusement.
When the Senate, February 20, divided on the motion to strike out the enacting clause, seventeen senators voted for the Bank and seventeen voted against it. Nine Northern senators voted in its favor, including seven of the ten from New England, and nine on the opposite side. Eight Southern senators voted one way, and eight the other. Of the twenty-seven Republican senators, seventeen voted against the Bank, and ten in its favor; while the three senators who were supposed to be in personal opposition to the President—Giles, Samuel Smith, and Michael Leib—all voted in opposition. The force of personal feeling was credited with still another vote; for when the result was announced, the Vice-President, George Clinton, whose attitude was notorious, made a short address to the effect that “the power to create corporations is not expressly granted; it is a high attribute of sovereignty, and in its nature not accessorial or derivative by implication, but primary and independent.” On this ground he threw his casting vote against the bill.
So perished the first Bank of the United States; and with its destruction the Federalist crisis, so long threatened, began at last to throw its shadow over the government.