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.

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And now, having gone through with all the details of this series of resolutions, which I thought it my duty to notice, allow me, in drawing to a conclusion of these remarks, to present some of the advantages which it appears to me should urge us to adopt the system of financial arrangement contemplated in the resolutions.

And first, the government will, in this way, secure to itself an adequate amount of revenue, without being obliged to depend on temporary and disreputable expedients, and thus preserve the public credit unsullied, which I deem a great advantage of the plan. Credit is of incalculable value, whether to a nation or an individual. England, proud England, a country with which we may one day again come in conflict—though it gives me pleasure to say, that I cannot perceive at present the least ‘speck of war’ in the political horizon—owes her greatness, her vastness of power, pervading the habitable globe, mainly to her strict and uniform attention to the preservation of the national credit.

Second. The next thing recommended is retrenchment in the national expenditure, and greater economy in the administration of the government. And do we not owe it to this bleeding country, to ourselves, and the unparalleled condition of the time, to exhibit to the world a fixed, resolute, and patriotic purpose, to reduce the public expenditure to an economical standard?

Third. But a much more important advantage than either of those I have yet adverted to, is to be found in the check which the adoption of this plan will impose on the efflux of the precious metals from this country to foreign countries. I shall not now go into the causes by which the country has been brought down from the elevated condition of prosperity it once enjoyed, to its present state of general embarrassment and distress. I think that those causes are as distinctly in my understanding and memory as any subjects were ever impressed there; but I have no desire to go into a discussion which can only revive the remembrance of unpleasant topics. My purpose, my fixed purpose on this occasion, has been to appeal to all gentlemen on all political sides of this chamber, to come out, and make a sacrifice of all lesser differences, in a patriotic, generous, and general effort, for the relief of their country. I shall not open these bleeding wounds which have, in too many instances, been inflicted by brothers’ hands—especially will I not do so at this time, and on this occasion. I shall look merely at facts as they are. I shall not ask what have been the remote causes of the depression and wretchedness of our once glorious and happy country. I will turn my view only on causes which are proximate, indisputable, and immediately before us.

One great if not sole cause is to be found in the withdrawal of coin from the country, to pay debts accrued or accruing abroad, for foreign imports, or debts contracted during former periods of prosperity, and still hanging over the country. How this withdrawal operates in practice, is not difficult to be understood. The banks of the country, when they are in a sound state, act upon this coin as the basis of their circulation and discounts; the withdrawal of it not only obliges the banks to withhold discounts and accommodations, but to draw in what is due from their debtors, at the precise time when they, sharing in the general stricture, are least able to meet the calls. Property is then thrown into the market, to raise means to comply with those demands, depression ensues, and, as is invariably the case when there is a downward tendency in its value, it falls below its real worth. But the foreign demand for specie, to pay commercial and other public debt, operates directly upon the precious metals themselves, which are gathered up by bankers, and brokers, and others, obtained from these depositories, and thence exported. Thus, this foreign demand has a double operation, one upon the banks, and through them upon the community, and the other upon the coin of the country. Gentlemen, in my humble opinion, utterly deceive themselves in attributing to the banking institutions all the distresses of the country. Doubtless, the erroneous and fraudulent administration of some of them, has occasioned much local and individual distress. But this would be temporary and limited, whilst the other cause—the continued efflux of specie from the country—if not arrested, would perpetuatethe distress. Could you annihilate every bank in the union, and burn every bank note, and substitute in their place a circulation of nothing but the precious metals, as long as such a tariff continues as now exists, two years would not elapse till you would find the imperative necessity of some paper medium for conducting the domestic exchanges.

I announce only an historical truth, when I declare, that during, and ever since our colonial existence, necessity has given rise to the existence of a paper circulation of some form, in every colony on this continent; and there was a perpetual struggle between the crown and royal governors on one hand, and the colonial legislatures on the other, on this very subject of paper money. No; if you had to-morrow a circulation consisting of nothing but the precious metals, they would leave you as the morning dew leaves the fields, and you would be left under the necessity of devising a mode to fill the chasm produced by their absence.

I am ready to make one concession to the gentlemen on the other side. I admit that, if the circulation were in coin alone, the thermometer of our monetary fluctuations would not rise as high, or fall as low as when the circulation is of a mixed character, consisting partly of coin and partly of paper. But then the fluctuations themselves, within a more circumscribed range, would be quite as numerous, and they will and must exist so long as such a tariff remains as forces the precious metals abroad. I again repeat the assertion that, could you annihilate to-morrow every bank in the country, the very same description of embarrassment, if not in the same degree, would still be found which now pervades our country.

What, then, is to be done, to check this foreign drain? We have tried free trade. We have had the principles of free trade operating on more than half the total amount of our comforts, for the greater part of nine years past. That will not do, we see. Do let me recall to the recollection of the senate the period when the protective system was thought about to be permanently established. What was the great argument then urged against its establishment? It was this: that if duties were laid directly for protection, then we must resort to direct taxation to meet the wants of the government; everybody must make up their minds to a system of internal taxation. Look at the debate in the house of representatives of 1824, and you will find that was the point on which the great stress was laid. Well, it turned out as the friends of protection told you it would. We said that such would not be the effect. True, it would diminish importation, as it did; but the augmented amount of taxes would more than compensate for the reduced amount of goods. This we told you, and we were right.

How has free trade operated on other great interests? I well remember, that, ten years ago, one of the most gifted of the sons of South Carolina, (Mr. Hayne,) after drawing a most vivid andfrightful picture of the condition of the south—of fields abandoned, houses dilapidated, overseers becoming masters, and masters overseers, general stagnation, and approaching ruin; a picture which, I confess, filled me with dismay—cried out to us, abolish your tariff, reduce your revenue to the standard of an economical government, and once more the fields of South Carolina will smile with beauty, her embarrassments will vanish, commerce will return to her harbors, labor to her plantations; augmented prices for her staples, and contentment, and prosperity, and universal happiness to her oppressed people. Well, we did reduce the tariff, and, after nine years of protection, we have had nine years of a descending tariff and of free trade. Nine years, (from 1824 to 1833,) we had the protective policy of a high tariff; and nine years, (from 1833 to 1842,) we have had the full operation of free trade on more than a moiety of the whole amount of our imports, and a descending tariff on the residue. And what is the condition of South Carolina at this day? Has she regained her lost prosperity? Has she recovered from the desolation and ruin so confidently imputed to the existence of a high tariff? I believe, if the gentleman from South Carolina could be interrogated here, and would respond in candor, unbiased by the delusions engendered by a favorite but delusive theory, he would tell us that she had not experienced the promised prosperity which was dwelt upon with so much eloquence by his fellow citizen. How is it in regard to the great staple of the south? How stand the prices of cotton during these nine years of the descending tariff, and the prevalence of free trade? How do these years compare with the nine years of protection and high tariff? Has the price of cotton increased, as we were told it would, by the talented South Carolinian? It has happened that during the nine tariff years the average price of cotton was from 1824 to 1833 higher than during the nine years of descending tariff and free trade; and at the instant I am speaking, I understand that cotton is selling at a lower rate than has been realized since the war with Great Britain. I know with what tenacity theorists adhere to a favorite theory, and search out for imaginary causes of results before their eyes, and deny the true. I am not going into the land of abstractions and of metaphysics. There are two great, leading, incontestable facts, which gentlemen must admit; first, that a high tariff did not put down the prices of staple commodities; and, second, that a low tariff and free trade have not been able to save them from depression. These are the facts; let causists, and theorists, and the advocates of a one-sided, paralytic free trade, in which we turn our sound side to the world, and our blighted, and paralysed, and dead side toward our own people, make of them what they can. At the very moment that England is pushing the resources of Asia, cultivating the fields of India, and even contemplating the subsidizing of Africa, for thesupply of her factories with cotton, and when the importations from India have swelled from two hundred thousand bales to five hundred and eighty thousand bales, we are told that there are to be no restrictions on free trade.

Let me not be misunderstood, and let me entreat that I may not be misrepresented. I am not advocating the revival of a high protective tariff. I am for abiding by the principles of the compromise act; I am for doing what no southern man of a fair or candid mind has ever yet denied—giving to the country a revenue which may provide for the economical wants of the government, and at the same time give an incidental protection to our home industry. If there be here a single gentleman who will deny the fairness and propriety of this, I shall be glad to see and hear who he is.