A Biography of Henry Clay, the Senator from Kentucky / Containing Also, a Complete Report of All His Speeches; Selections From His Private Correspondence; Eulogies in the Senate and House; and a Poem, by George D. Prentice, Esq.

by Unknown

We are told by the president of the United States, in his message at the opening of the session, that a great moneyed power exists in London, that exerts a powerful influence on this country that it is the result of the credit system; and that every bank established in a remote village in this country, becomes bound to that power by a cord, which it touches at its pleasure.

There is, sir, some truth in this representation, and every genuine American must feel it with shame and regret. It is a melancholy fact, that the arrival of steam vessels in the port of New York, from England, is looked for with more curiosity and interest, on account of the financial intelligence which they bear from London and the bank of England, than the arrival of the mail from congress. Our people have been taught, by sad experience, to expect nothing good from the councils of their own country, and turn their attention towards the operations in a foreign country. Was this eager inquiry into the transactions of the bank of England made during the existence of the bank of the United States? No sir, no sir. You denounced this bank as a monster, destroyed it; and you have thrown us into the jaws of a foreign-monster, which we can neither cage nor control. You tore from us our best shield against the bank of England, and now profess to be surprised at the influence which it exercises upon our interests! We do not find that the continental nations of Europe, that have national banks, complain of the influence of the bank of England upon them. On the contrary, the bank of England has recently been compelled to apply to the bank of France for a large sum of specie to sustain its credit and character.

But, sir, we must look to higher and much more potent causes than the operations of any bank, foreign or domestic, for the lively interest which is felt in this country, in the monetary transactions of England. In England, the credit system, as it is called, exists in a much more extensive degree than in this country; and, if it were true of the nature of that system, as is alleged, to render one country dependent upon another, why should not England be more dependent upon us, than we upon England? The real cause of our dependence arises out of the unfavorable balance of our foreign trade. We import too much, and export too little. We buy too much abroad, make too little at home. If we would shake off this degrading foreign dependence, we must produce more, or buy less. Increase our productions, in all the variety of forms in which our industry can be employed; augment the products of our soil, extend our manufactures, give new stimulus to our tonnage and fishing interests, sell more than we buy, get out of debt and keep out of debt to the foreigner, and he will no longer exert an influence upon our destiny.

And this unfavorable balance of our foreign trade is wholly independent of, and unconnected with, the nature of the character of the currency of the country, whether it be exclusively metallic, or mixed with paper and the precious metals. England, in a great measure, by means of that credit or paper system, now so much denounced, has become the centre of the commerce, the exchanges, and the moneyed operations of the world. By the extent, variety, and perfection of her manufactures, she lays most nations thatadmit them freely, under contribution to her. And if we had no currency but specie, we should be just as much exposed to the moneyed power of London, or, which is the true state of the case, to the effects of an unfavorable balance of trade, as we now are. We should probably be more so; because a large portion of the specie of the country being in the vaults of a few depositaries, it would be easier then to obtain it for exportation, in the operations of commerce, than now, when it is dispersed among nine hundred or a thousand banks. What was our condition during the colonial state, when, with the exception of small amounts of government paper money, we had no currency but specie, and no banks? Were we not constantly and largely in debt to England? Was not our specie perpetually drained to obtain supplies of British goods? Do you not recollect that the subject of the British debts formed one of those matters which were embraced in the negotiations and treaty of peace, which terminated the revolutionary war? And that it was a topic of angry and protracted discussion long after, until it was finally arranged by Mr. Jay’s treaty of 1794?

Look into the works of Doctor Franklin, in which there is more practical good sense to be found, than is to be met with in the same compass any where. He was the agent of Pennsylvania, from about the middle of the last century until the breaking out of the revolutionary war, and a part of the time the agent, also, of the colonies of Georgia, and Massachusetts. His correspondence shows, that the specie of the colonies was constantly flowing from them for the purchase of British goods, insomuch that the colonies were left absolutely destitute of a local currency; and one of the main objects of his agency was to obtain the sanction of the parent country to those issues of paper money, which the necessities of Pennsylvania compelled her to make. The issue was strenuously opposed by the merchants engaged in the American trade, on account of the difficulty which it created in making collections and remittances home. So great was that drain of specie, that we know that Virginia and other colonies were constrained to adopt tobacco as a substitute for money.

The principal cause, therefore, of the influence of the moneyed power of London over this country, is to be found in the vast extent of our dealings with her. The true remedy is, to increase our manufactures and purchase less of hers, and to augment our exports by all the means in our power, and to diminish our imports as much as possible. We must increase our productions, or economise much more than we have done. New Jersey, before the revolution, being much pressed for one hundred thousand pounds sterling, Doctor Franklin proposed a plan, by which she could in one year make up that sum. The plan was this; she was in the habit of importing annually from England merchandise to the amount of two hundred thousand pounds. He recommended thatthe ladies should buy only half the amount of silks, calicoes, teas, and so forth, during the year, which they had been in the habit of consuming; and in this way by saving, the colony would make the required sum of one hundred thousand pounds. If we would, for a few years, import only half the amount from England that we have been in the habit of doing, we should no longer feel the influence of the London money power.

Mr. President, gentlemen, in my humble opinion, utterly deceive themselves, in supposing that this measure is demanded by a majority of the people of the United States, and in alleging that this is proved by the result of elections of the past year. That there were a vast majority of them opposed to it was demonstrated incontestably by previous elections. The elections of last year did not in many, perhaps most instances, turn at all upon the merits of this measure. In several states the people were deceived by assurances that the sub-treasury was at an end, and would be no longer agitated. In others, the people had reason to be dissatisfied with the conduct of their banks; and they were artfully led to believe this bill would supply a corrective of the errors of the banking system. And where they have apparently yielded their assent to the bill, it has been that sort of assent which the patient yields, whose constitution has been exhausted and destroyed by the experiments of empiricism, and who finally consents to take the last quack medicine offered to him in the hope of saving his life. I know the people of the United States well. They are ever ready cheerfully to submit to any burden demanded by the interest, the honor, or the glory of their country. But what people ever consented to increase their own burdens unnecessarily? The effect of this measure is, by exacting specie exclusively from the people, and paying it out to the official corps and the public creditor, to augment the burdens of the people, and to swell the emoluments of office. It is an insult to the understanding and judgment of the enlightened people of the United States, to assert that they can approve such a measure.

No true patriot can contemplate the course of the party in power without the most painful and mortified feelings. They began some years ago their war on the bank of the United States. It was dangerous to liberty; it had failed to fulfil the purposes of its institution; it did not furnish a sound currency, although the sun, in all its course, never shone upon a better. In short, it was a monster, which was condemned to death, and it was executed accordingly. During the progress of that war, the state banks were the constant theme of praise, in speech and song, of the dominant party. They were the best institutions in the world, free from all danger to public liberty, capable of carrying on the exchanges of the country, and of performing the financial duties to government, and of supplying a far better currency for the people than the bank of the United States. We told you that the state banks would not do,without the coöperation of a bank of the United States. We told you that you would find them a weak league; a mere fleet of open boats tied together by a hickory withe, and which the first storm would disperse and upset. But you scorned all our warnings, and continued, year after year, to puff and praise the operations of these banks. You had the boldness, in the face of this abused nation, to aver that the country had been supplied by them with a better currency, and better exchanges, than it had been by the bank of the United States. Well, by your own measures, by your treasury circular, distribution of the surplus, and so forth, you accelerated the catastrophe of the suspension of the banks. You began with promises to the people of a better currency, better times, more security to civil liberty; and you end with no currency at all, the worst possible times, an increase of executive power, and a consequent increase of danger to civil liberty. You began with promises to fill the pockets of the people, and you end by emptying theirs and filling your own.

I now proceed, sir, to the object which constituted the main purpose of my rising at this time. I have hitherto considered the bill, as its friends in the senate represent it, as a measure simply for exacting specie, keeping it in the custody of officers of the government, and disbursing it in a course of administration. I mean now to show that, whatever its friends here may profess or believe, the bill lays the foundations, deep and broad, of a government bank—a treasury bank, under the sole management of the president. Let us first define a bank. It may have three faculties, separately, or combined; the faculty of issues, entering into and forming a part of the circulating medium of the country; that of receiving deposits, and that of making discounts. Any one of these three faculties makes it a bank; and by far the most important of the three, is that of the power of issues. That this bill creates a bank of issues, I most sincerely believe, and shall now attempt to prove; and the proof will be first extraneous, and secondly intrinsic.

As to the extraneous proof, I rely upon the repeated declarations of the late president of the United States, in his annual messages. On more than one occasion, he stated the practicability of establishing a bank on the revenue of the government, and to be under the superintendence of the secretary of the treasury. And when he vetoed the charter of the late bank of the United States, he expressly declared, that, if congress had applied to him, he could have furnished the scheme of a bank, free from all constitutional objections; doubtless meaning a treasury bank. The present chief magistrate and the present secretary of the treasury have also, repeatedly, in language, in their messages and reports, characteristically ambiguous, it is true, but sufficiently intelligible, intimated the facilities which the commerce and business of the country would derive from the drafts issued by the treasury in virtue of thisbill. The party, its press, and its leaders, have constantly put this sub-treasury scheme in competition with a bank of the United States, and contended that the issue was sub-treasury or bank of the United States. But how can they be compared, or come in competition with each other, if the most important function of a bank of the United States—that of supplying a medium of general circulation and uniform value—is not to be performed under this bill?