State of the Union Addresses

by Martin Van Buren

These are my views upon this important subject, formed after careful reflection and with no desire but to arrive at what is most likely to promote the public interest. They are now, as they were before, submitted with unfeigned deference for the opinions of others. It was hardly to be hoped that changes so important on a subject so interesting could be made without producing a serious diversity of opinion; but so long as those conflicting views are kept above the influence of individual or local interests, so long as they pursue only the general good and are discussed with moderation and candor, such diversity is a benefit, not an injury. If a majority of Congress see the public welfare in a different light, and more especially if they should be satisfied that the measure proposed would not be acceptable to the people, I shall look to their wisdom to substitute such as may be more conducive to the one and more satisfactory to the other. In any event, they may confidently rely on my hearty cooperation to the fullest extent to which my views of the Constitution and my sense of duty will permit.

It is obviously important to this branch of the public service and to the business and quiet of the country that the whole subject should in some way be settled and regulated by law, and, if possible, at your present session. Besides the plans above referred to, I am not aware that any one has been suggested except that of keeping the public money in the State banks in special deposit. This plan is to some extent in accordance with the practice of the Government and with the present arrangements of the Treasury Department, which, except, perhaps, during the operation of the late deposit act, has always been allowed, even during the existence of a national bank, to make a temporary use of the State banks in particular places for the safe-keeping of portions of the revenue. This discretionary power might be continued if Congress deem it desirable, whatever general system be adopted. So long as the connection is voluntary we need, perhaps, anticipate few of those difficulties and little of that dependence on the banks which must attend every such connection when compulsory in its nature and when so arranged as to make the banks a fixed part of the machinery of government. It is undoubtedly in the power of Congress so to regulate and guard it as to prevent the public money from being applied to the use or intermingled with the affairs of individuals. Thus arranged, although it would not give to the Government that entire control over its own funds which I desire to secure to it by the plan I have proposed, it would, it must be admitted, in a great degree accomplish one of the objects which has recommended that plan to my judgment--the separation of the fiscal concerns of the Government from those of individuals or corporations.

With these observations I recommend the whole matter to your dispassionate reflection, confidently hoping that some conclusion may be reached by your deliberations which on the one hand shall give safety and stability to the fiscal operations of the Government, and be consistent, on the other, with the genius of our institutions and with the interests and wishes of the great mass of our constituents.

It was my hope that nothing would occur to make necessary on this occasion any allusion to the late national bank. There are circumstances, however, connected with the present state of its affairs that bear so directly on the character of the Government and the welfare of the citizen that I should not feel myself excused in neglecting to notice them. The charter which terminated its banking privileges on the 4th of March, 1836, continued its corporate power two years more for the sole purpose of closing its affairs, with authority "to use the corporate name, style, and capacity for the purpose of suits for a final settlement and liquidation of the affairs and acts of the corporation, and for the sale and disposition of their estate--real, personal, and mixed--but for no other purpose or in any other manner whatsoever." Just before the banking privileges ceased, its effects were transferred by the bank to a new State institution, then recently incorporated, in trust, for the discharge of its debts and the settlement of its affairs. With this trustee, by authority of Congress, an adjustment was subsequently made of the large interest which the Government had in the stock of the institution. The manner in which a trust unexpectedly created upon the act granting the charter, and involving such great public interests, has been executed would under any circumstances be a fit subject of inquiry; but much more does it deserve your attention when it embraces the redemption of obligations to which the authority and credit of the United States have given value. The two years allowed are now nearly at an end. It is well understood that the trustee has not redeemed and canceled the outstanding notes of the bank, but has reissued and is actually reissuing, since the 3d of March, 1836, the notes which have been received by it to a vast amount. According to its own official statement, so late as the 1st of October last, nineteen months after the banking privileges given by the charter had expired, it had under its control uncanceled notes of the late Bank of the United States to the amount of $27,561,866, of which $6,175,861 were in actual circulation, $ 1,468,627 at State bank agencies, and $3,002,390 in transitu, thus showing that upward of ten millions and a half of the notes of the old bank were then still kept outstanding.

The impropriety of this procedure is obvious, it being the duty of the trustee to cancel and not to put forth the notes of an institution whose concerns it had undertaken to wind up. If the trustee has a right to reissue these notes now, I can see no reason why it may not continue to do so after the expiration of the two years. As no one could have anticipated a course so extraordinary, the prohibitory clause of the charter above quoted was not accompanied by any penalty or other special provision for enforcing it, nor have we any general law for the prevention of similar acts in future.

But it is not in this view of the subject alone that your interposition is required. The United States in settling with the trustee for their stock have withdrawn their funds from their former direct liability to the creditors of the old bank, yet notes of the institution continue to be sent forth in its name, and apparently upon the authority of the United States. The transactions connected with the employment of the bills of the old bank are of vast extent, and should they result unfortunately the interests of individuals may be deeply compromised. Without undertaking to decide how far or in what form, if any, the trustee could be made liable for notes which contain no obligation on its part, or the old bank for such as are put in circulation after the expiration of its charter and without its authority, or the Government for indemnity in case of loss, the question still presses itself upon your consideration whether it is consistent with duty and good faith on the part of the Government to witness this proceeding without a single effort to arrest it.

The report of the Commissioner of the General Land Office, which will be laid before you by the Secretary of the Treasury, will show how the affairs of that office have been conducted for the past year. The disposition of the public lands is one of the most important trusts confided to Congress. The practicability of retaining the title and control of such extensive domains in the General Government, and at the same time admitting the Territories embracing them into the Federal Union as coequals with the original States, was seriously doubted by many of our wisest statesmen. All feared that they would become a source of discord, and many carried their apprehensions so far as to see in them the seeds of a future dissolution of the Confederacy. But happily our experience has already been sufficient to quiet in a great degree all such apprehensions. The position at one time assumed, that the admission of new States into the Union on the same footing with the original States was incompatible with a right of soil in the United States and operated as a surrender thereof, notwithstanding the terms of the compacts by which their admission was designed to be regulated, has been wisely abandoned. Whether in the new or the old States, all now agree that the right of soil to the public lands remains in the Federal Government, and that these lands constitute a common property, to be disposed of for the common benefit of all the States, old and new. Acquiescence in this just principle by the people of the new States has naturally promoted a disposition to adopt the most liberal policy in the sale of the public lands. A policy which should be limited to the mere object of selling the lands for the greatest possible sum of money, without regard to higher considerations, finds but few advocates. On the contrary, it is generally conceded that whilst the mode of disposition adopted by the Government should always be a prudent one, yet its leading object ought to be the early settlement and cultivation of the lands sold, and that it should discountenance, if it can not prevent, the accumulation of large tracts in the same hands, which must necessarily retard the growth of the new States or entail upon them a dependent tenantry and its attendant evils.

A question embracing such important interests and so well calculated to enlist the feelings of the people in every quarter of the Union has very naturally given rise to numerous plans for the improvement of the existing system. The distinctive features of the policy that has hitherto prevailed are to dispose of the public lands at moderate prices, thus enabling a greater number to enter into competition for their purchase and accomplishing a double object--of promoting their rapid settlement by the purchasers and at the same time increasing the receipts of the Treasury; to sell for cash, thereby preventing the disturbing influence of a large mass of private citizens indebted to the Government which they have a voice in controlling; to bring them into market no faster than good lands are supposed to be wanted for improvement, thereby preventing the accumulation of large tracts in few hands; and to apply the proceeds of the sales to the general purposes of the Government, thus diminishing the amount to be raised from the people of the States by taxation and giving each State its portion of the benefits to be derived from this common fund in a manner the most quiet, and at the same time, perhaps, the most equitable, that can be devised. These provisions, with occasional enactments in behalf of special interests deemed entitled to the favor of the Government, have in their execution produced results as beneficial upon the whole as could reasonably be expected in a matter so vast, so complicated, and so exciting. Upward of 70,000,000, acres have been sold, the greater part of which is believed to have been purchased for actual settlement. The population of the new States and Territories created out of the public domain increased between 1800 and 1830 from less than 60,000 to upward of 2,300,000 souls, constituting at the latter period about one-fifth of the whole people of the United States. The increase since can not be accurately known, but the whole may now be safely estimated at over three and a half millions of souls, composing nine States, the representatives of which constitute above one-third of the Senate and over one-sixth of the House of Representatives of the United States.

Thus has been formed a body of free and independent landholders with a rapidity unequaled in the history of mankind; and this great result has been produced without leaving anything for future adjustment between the Government and its citizens. The system under which so much has been accomplished can not be intrinsically bad, and with occasional modifications to correct abuses and adapt it to changes of circumstances may, I think, be safely trusted for the future. There is in the management of such extensive interests much virtue in stability; and although great and obvious improvements should not be declined, changes should never be made without the fullest examination and the clearest demonstration of their practical utility. In the history of the past we have an assurance that this safe rule of action will not be departed from in relation to the public lands; nor is it believed that any necessity exists for interfering with the fundamental principles of the system, or that the public mind, even in the new States, is desirous of any radical alterations. On the contrary, the general disposition appears to be to make such modifications and additions only as will the more effectually carry out the original policy of filling our new States and Territories with an industrious and independent population.

The modification most perseveringly pressed upon Congress, which has occupied so much of its time for years past, and will probably do so for a long time to come, if not sooner satisfactorily adjusted, is a reduction in the cost of such portions of the public lands as are ascertained to be unsalable at the rate now established by law, and a graduation according to their relative value of the prices at which they may hereafter be sold. It is worthy of consideration whether justice may not be done to every interest in this matter, and a vexed question set at rest, perhaps forever, by a reasonable compromise of conflicting opinions. Hitherto, after being offered at public sale, lands have been disposed of at one uniform price, whatever difference there might be in their intrinsic value. The leading considerations urged in favor of the measure referred to are that in almost all the land districts, and particularly in those in which the lands have been long surveyed and exposed to sale, there are still remaining numerous and large tracts of every gradation of value, from the Government price downward; that these lands will not be purchased at the Government price so long as better can be conveniently obtained for the same amount; that there are large tracts which even the improvements of the adjacent lands will never raise to that price, and that the present uniform price, combined with their irregular value, operates to prevent a desirable compactness of settlements in the new States and to retard the full development of that wise policy on which our land system is founded, to the injury not only of the several States where the lands lie, but of the United States as a whole.