IN THE SENATE OF THE UNITED STATES, SEPTEMBER 25, 1837.
[AFTER the removal of the public deposits from the bank of the United States, by order of president Jackson, in October, 1833, the revenues were collected and disbursed through certain state banks, selected by the secretary of the treasury. In the month of May, 1837, the pressure upon the banks was so great, from a variety of causes, that a general suspension of specie payments took place. In this state of things, Mr. Van Buren, who succeeded general Jackson as president, in March, 1837, issued a proclamation, calling an extra session of congress, to meet on the first Monday in September. In his message to that body, which contained a majority favorable to his administration, he recommended the adoption of a system of finance, in collecting and disbursing the revenue of the nation, in gold and silver, which was called by its supporters, ‘the Independent Treasury,’ and by its opponents, ‘the Sub-Treasury.’ The system had been before proposed in congress, by Mr. Gordon, of Virginia, and rejected, the friends of Mr. Van Buren at that time generally voting against it. On the present occasion, Mr. Clay delivered his sentiments on this novel project, in the following remarks; a bill having been introduced by Mr. Wright, chairman of the committee on finance, embodying the system referred to, which was not finally adopted, until near the close of Mr. Van Buren’s administration.]
FEELING an anxious desire to see some effectual plan presented, to correct the disorders in the currency, and to restore the prosperity of the country, I have avoided precipitating myself into the debate now in progress, that I may attentively examine every remedy that may be proposed, and impartially weigh every consideration urged in its support. No period has ever existed in this country, in which the future was covered by a darker, denser, or more impenetrable gloom. None, in which the duty was more imperative to discard all passion and prejudice, all party ties, and previous bias, and look exclusively to the good of our afflicted country. In one respect, and I think it a fortunate one, our present difficulties are distinguishable from former domestic trouble, and that is their universality. They are felt, it is true, in different degrees, but they reach every section, every state, every interest, almost every man in the union. All feel, see, hear, know their existence. As they do not array, like our former divisions, one portion of the confederacy against another, it is to be hoped that common sufferings may lead to common sympathies and common counsels, and that we shall, at no distant day, be able to see a clear way of deliverance. If the present state of the country were produced by the fault of thepeople; if it proceeded from their wasteful extravagance, and their indulgence of a reckless spirit of ruinous speculation; if public measures had no agency whatever in bringing it about; it would, nevertheless, be the duty of government to exert all its energies, and to employ all its legitimate powers, to devise an efficacious remedy. But if our present deplorable condition has sprung from our rulers; if it is to be clearly traced to their acts and operations, that duty becomes infinitely more obligatory; and government would be faithless to the highest and most solemn of human trusts should it neglect to perform it. And is it not too true, that the evils which surround us are to be ascribed to those who have had the conduct of our public affairs?
In glancing at the past, nothing can be further from my intention than to excite angry feelings, or to find grounds of reproach. It would be far more congenial to my wishes, that, on this occasion, we should forget all former unhappy divisions and animosities. But in order to discover how to get out of our difficulties, we must ascertain if we can, how we got into them.
Prior to that series of unfortunate measures which had for its object the overthrow of the bank of the United States, and the discontinuance of its fiscal agency for the government, no people upon earth ever enjoyed a better currency, or had exchanges better regulated, than the people of the United States. Our monetary system appeared to have attained as great perfection as any thing human can possibly reach. The combination of United States and local banks presented a true image of our system of general and state governments, and worked quite as well. Not only within the country had we a local and general currency perfectly sound, but in whatever quarter of the globe American commerce had penetrated, there also did the bills of the United States bank command unbounded credit and confidence. Now we are in danger of having fixed upon us, indefinitely as to time, that medium, an irredeemable paper currency, which, by the universal consent of the commercial world, is regarded as the worst. How has this reverse come upon us? Can it be doubted that it is the result of those measures to which I have adverted? When, at the very moment of adopting them, the very consequences which have happened were foretold as inevitable, is it necessary to look elsewhere for their cause? Never was prediction more distinctly made; never was fulfilment more literal and exact.
Let us suppose that those measures had not been adopted; that the bank of the United States had been rechartered; that the public deposits had remain undisturbed; and that the treasury order had never issued: is there not every reason to believe that we should be now in the enjoyment of a sound currency; that the public deposits would be now safe and forthcoming, and that the suspension of specie payments in May last, would not have happened?
The president’s message asserts that the suspension has proceeded from over-action, over-trading, the indulgence of a spirit of speculation, produced by bank and other facilities. I think this is a view of the case entirely too superficial. It would be quite as correct and just, in the instance of a homicide perpetrated by the discharge of a gun, to allege that the leaden ball, and not the man who levelled the piece, was responsible for the murder. The true inquiry is, how came that excessive over-trading, and those extensive bank facilities, which the message describes? Were they not the necessary and immediate consequences of the overthrow of the bank, and the removal from its custody of the public deposits? And is not this proved by the vast multiplication of banks, the increase of the line of their discounts and accommodations, prompted and stimulated by secretary Taney, and the great augmentation of their circulation which ensued?
What occurred in the state of Kentucky, in consequence of the veto of the recharter of the bank of the United States, illustrates its effects throughout the union. That state had suffered greatly by banks. It was generally opposed to the reëstablishment of them. It had found the notes of the bank of the United States answering all the purposes of a sound currency, at home and abroad, and it was perfectly contented with them. At the period of the veto, it had but a single bank, of limited capital and circulation. After it, the state, reluctant to engage in the banking system, and still cherishing hopes of the creation of a new bank of the United States, encouraged by the supporters of the late president, hesitated about the incorporation of new banks. But at length, despairing of the establishment of a bank of the United States, and finding itself exposed to a currency in bank notes from adjacent states, it proceeded to establish banks of its own; and since the veto, since 1833, has incorporated for that single state, bank capital to the amount of ten millions of dollars—a sum equal to the capital of the first bank of the United States, created for the whole union.
That the local banks, to which the deposits were transferred from the bank of the United States, were urged and stimulated freely to discount upon them, we have record evidence from the treasury department.
The message, to reconcile us to our misfortunes, and to exonerate the measures of our own government from all blame in producing the present state of things, refers to the condition of Europe, and especially to that of Great Britain. It alleges that