I clearly recognize that while the public mind is decidedly in favor of encouraging home manufacturers by levying what are called protective duties, yet the people are opposed to placing those duties so high that they become prohibitory and making thereby an exclusive market for our manufacturers at home. It seems very clear to my mind, in view of these statements as to the result of decreasing or increasing the duties on our imports, that no reduction of revenue is practicable by changes in our tariff.
The second great interest of the people, which will very shortly be directly affected by the large and increasing surplus revenues of the country, is the system of national banks, and this through the decrease of the public indebtedness by the application of the annual surplus to its payment. The large annual reduction of the public debt will very shortly begin to affect the confidence of the public in the continuation of the system. It will increase public anxieties and excite their fears as to a substitution of any other system for this that has proven so acceptable and so valuable to the country. If the national banking system is to be worked out of existence, it will inevitably cause serious financial trouble.
Financial difficulties among a people like those of this country, however ill-based or slight, are always attended by disastrous consequences, because in times of prosperity the energies and hopefulness of the people are stretched to the utmost limits, and the shock of financial trouble has the effect of an almost total paralysis on the business of the country. It is certainly the part of statesmanship to avoid such a calamity whenever it is possible.
I unhesitatingly declare and believe that the value of our system of national banks is so great in the benefits the country derives therefrom and the dangers and losses its continuance will avoid that it were better to continue in existence an indebtedness equal to the wants of the banks which the country may from time to time require until some equally conservative plan may be offered that will enable us to dispense with the system.
It is also important in this connection for Senators to bear in mind that the increasing business of the country will annually require increased banking facilities, and consequently increased bonds as the basis on which they can be organized; and it should not be overlooked that a possible determination by Congress to pay off by retiring or by funding the greenbacks will create a great hiatus in the circulating medium of the country, which can only be replaced by additional national-bank notes based upon an equivalent amount of public indebtedness.
In view of the statements I have made, I cannot but conclude that the wisest and most prudent course for Congress is to leave the question of changes in the tariff laws to be adjusted as they may from time to time require, and to make whatever reduction of the income of the Government that may be found desirable by reducing the changes in the internal-revenue laws.
The national revenue laws as they now are may be greatly and profitably changed. They are very burdensome to a heavily-taxed people, and such burdens should be relieved wherever it is possible. This can now be done with safety by providing that so much of the public debt may be paid off from time to time as may not be required to sustain the system of national banks.
I move that the resolution be referred to the Committee on Finance.
The motion was agreed to.