VETO MESSAGES.
WASHINGTON, August 16, 1841.
To the Senate of the United States:
The bill entitled "An act to incorporate the subscribers to the Fiscal Bank of the United States," which originated in the Senate, has been considered by me with a sincere desire to conform my action in regard to it to that of the two Houses of Congress. By the Constitution it is made my duty either to approve the bill by signing it or to return it with my objections to the House in which it originated. I can not conscientiously give it my approval, and I proceed to discharge the duty required of me by the Constitution—to give my reasons for disapproving.
The power of Congress to create a national bank to operate per se over the Union has been a question of dispute from the origin of the Government. Men most justly and deservedly esteemed for their high intellectual endowments, their virtue, and their patriotism have in regard to it entertained different and conflicting opinions; Congresses have differed; the approval of one President has been followed by the disapproval of another; the people at different times have acquiesced in decisions both for and against. The country has been and still is deeply agitated by this unsettled question. It will suffice for me to say that my own opinion has been uniformly proclaimed to be against the exercise of any such power by this Government. On all suitable occasions during a period of twenty-five years the opinion thus entertained has been unreservedly expressed. I declared it in the legislature of my native State; in the House of Representatives of the United States it has been openly vindicated by me; in the Senate Chamber, in the presence and hearing of many who are at this time members of that body, it has been affirmed and reaffirmed in speeches and reports there made and by votes there recorded; in popular assemblies I have unhesitatingly announced it, and the last public declaration which I made—and that but a short time before the late Presidential election—I referred to my previously expressed opinions as being those then entertained by me. With a full knowledge of the opinions thus entertained and never concealed, I was elected by the people Vice-President of the United States. By the occurrence of a contingency provided for in the Constitution and arising under an impressive dispensation of Providence I succeeded to the Presidential office. Before entering upon the duties of that office I took an oath that I would "preserve, protect, and defend the Constitution of the United States." Entertaining the opinions alluded to and having taken this oath, the Senate and the country will see that I could not give my sanction to a measure of the character described without surrendering all claim to the respect of honorable men, all confidence on the part of the people, all self-respect, all regard for moral and religious obligations, without an observance of which no government can be prosperous and no people can be happy. It would be to commit a crime which I would not willfully commit to gain any earthly reward, and which would justly subject me to the ridicule and scorn of all virtuous men.
I deem it entirely unnecessary at this time to enter upon the reasons which have brought my mind to the convictions I feel and entertain on this subject. They have been over and over again repeated. If some of those who have preceded me in this high office have entertained and avowed different opinions, I yield all confidence that their convictions were sincere. I claim only to have the same measure meted out to myself. Without going further into the argument, I will say that in looking to the powers of this Government to collect, safely keep, and disburse the public revenue, and incidentally to regulate the commerce and exchanges, I have not been able to satisfy myself that the establishment by this Government of a bank of discount in the ordinary acceptation of that term was a necessary means or one demanded by propriety to execute those powers. What can the local discounts of the bank have to do with the collecting, safe-keeping, and disbursing of the revenue? So far as the mere discounting of paper is concerned, it is quite immaterial to this question whether the discount is obtained at a State bank or a United States bank. They are both equally local, both beginning and both ending in a local accommodation. What influence have local discounts granted by any form of bank in the regulating of the currency and the exchanges? Let the history of the late United States Bank aid us in answering this inquiry.
For several years after the establishment of that institution it dealt almost exclusively in local discounts, and during that period the country was for the most part disappointed in the consequences anticipated from its incorporation. A uniform currency was not provided, exchanges were not regulated, and little or nothing was added to the general circulation, and in 1820 its embarrassments had become so great that the directors petitioned Congress to repeal that article of the charter which made its notes receivable everywhere in payment of the public dues. It had up to that period dealt to but a very small extent in exchanges, either foreign or domestic, and as late as 1823 its operations in that line amounted to a little more than $7,000,000 per annum. A very rapid augmentation soon after occurred, and in 1833 its dealings in the exchanges amounted to upward of $100,000,000, including the sales of its own drafts; and all these immense transactions were effected without the employment of extraordinary means. The currency of the country became sound, and the negotiations in the exchanges were carried on at the lowest possible rates. The circulation was increased to more than $22,000,000 and the notes of the bank were regarded as equal to specie all over the country, thus showing almost conclusively that it was the capacity to deal in exchanges, and not in local discounts, which furnished these facilities and advantages. It may be remarked, too, that notwithstanding the immense transactions of the bank in the purchase of exchange, the losses sustained were merely nominal, while in the line of discounts the suspended debt was enormous and proved most disastrous to the bank and the country. Its power of local discount has in fact proved to be a fruitful source of favoritism and corruption, alike destructive to the public morals and to the general weal.
The capital invested in banks of discount in the United States, created by the States, at this time exceeds $350,000,000, and if the discounting of local paper could have produced any beneficial effects the United States ought to possess the soundest currency in the world; but the reverse is lamentably the fact.
Is the measure now under consideration of the objectionable character to which I have alluded? It is clearly so unless by the sixteenth fundamental article of the eleventh section it is made otherwise. That article is in the following words: