« ZurückWeiter »
stand the immediate and exclusive profit and advantage of any single class of individuals whether merchants or bankers.
4. When the institutions of the people are mentioned, we do not understand private corporations established for individual profit drawn from the industry of the community. These two classes of institutions are entirely distinct in their objects, and are generally totally opposed in their results.
The foregoing explanations, together with a distinction we shall immediately notice which forms the staple of the reply, substanti. ally cover the whole ground assumed by Mr. Carey for the support of his new doctrines. He admits, nay he strongly and in express terms corroborates, our views of the consequences of the eredit system in all other countries. But notwithstanding it was the oh. ject of his previous publication to prove the necessity of the interposition of the Government, for the purpose of giving confidence to the paper currency issued by the banks, which at that time in most sections of the country was greatly depreciated, he now endeavours, with more dexterity than consistency, to make it appear that the disastrous consequences which have resulted every where in Europe from the use of paper currency, have not been owing to the people but to the governments. The great states of Europe where these melancholy results have been experienced on the largest scale are all monarchical in their forms. He accordingly insists in effect that excessive issues of paper curreney can only impoverish the people under monarchies, where “the government is all in all.” In a republic he contends that the universal issue of paper currency by the people cannot fail to produce the most perfect degree of security and steadiness. The fluctuations and insecurity which have been so frequently visited upon this country are wholly to be attributed to attempts on the part of our Government to imitate the ex. ample of the arbitrary sovereigns of Europe ! All the distress and embarassments into which our commercial and industrial interests have been from time to time involved have been exclusively owing to the interference of the Government!
Mr. Carey, in his ardor to increase our stock of illustrations of the deplorable consequences of the credit system upon the people of the several European nations, has entirely overlooked the more immediate and striking instances afforded by the annals of our own country. Like many of our modern philanthropists, he is eagleeyed in detecting misery and oppression in distant regions, but appears to be wholly blind and insensible to the every-day privations around him. A volume would not suffice for the description of the ruinous revulsions produced by the credit system of this country since 1791. The immediate effect of paper currency is to expel specie from circulation. Whoever possesses the power of making payments in a currency which costs nothing will never pay in a valuable and expensive medium. Wherever paper currency is permitted to become the exclusive medium of commercial interchange, the whole community is placed in the power of those who make it. By arbitrary expansions and contractions they are empowered to ruin the commerce and industry of the country at their pleasure
Let us cast a hasty glance at the monetary history of the United States during last twenty years. The most terrible revulsion. this country ever suffered was during 1819, 1820 and 1821, when the contraction of the operations of the Bank of the United States produced a change of ownership in the greater part of the property engaged in commercial pursuits throughout the Middle, Southern and Western States. What interference of the Government produced this series of disasters which ruined so many thousands ?In 1825 another crisis occurred, in the course of which the Bank of the United States was saved from immediate destruction only by the promptitude, address and good fortune of its President, according to his own account published to the world shortly afterwards. Numerous commercial houses of the highest credit and most extended transactions were prostrated by the suddenness and sever. ity of this shock. Was it caused by the interference of the Government? Mr. Adams, the friend and correspondent of Mr. Biddle, was then President of the United States, and the attempt to make him responsible for this revulsion would hardly be successful. In 1828 many of the most extensive manufacturers of the Eastern States were ruined, and a great number of failures occurred in our commercial cities. Mr. Adams was still President—but a strong probability existed that a ferocious military chieftain would be chosen by the people to succeed him. Perhaps, therefore, this awful revulsion should be attributed to the Executive magistrate about to be elected. We now come to the administration of that extraordinary man whose name and public services seem to inspire calumny and detraction among the satellites of the credit system in the same ratio as his character and abilities have elevated the character of our country in every part of the world. In several
passages nis reply Mr. Carey has gratified his exquisite taste and his love of veracity, by the repetition of the stale morsels of slander from the newspaper letter writers of the panic era. As the venerable individual whom they were originally intended to asperse, has retired from public life, we cannot envy the state of feeling which led to this clegant selection. The charter of the Bank of the United States would expire by its own limitation during the second term of his service, should he be re-elected. Gen. Jackson had been engaged in too many of the most important events of our history as a nation, not to have been fully aware of the destructive influence of such a Bank upon its highest interests, from the days of Morris and Hamilton. Measures were concerted to compel the people to re.
charter the Bank in despite of the Executive veto. An enormous but gradual increase of its accommodations was every where made, in order that as many individuals as possible might be brought into dependence. After these preparations had been completed, Congress was petitioned in 1832, four years in advance of the expiration of the charter, and on the eve of the Presidential election, to re-charter the Bank. The bill for that purpose was carried through both Houses under the personal superintendence of Mr. Biddle, but received the veto of the President, —upon which every expedient which influence, intimidation or bribery could bring into operation was used to defeat the re-election of the President. The expansions and contractions of the currency employed for this purpose should of course be attributed to Executive interference, since, had the President evinced the same docility with many others, these fluctualions which caused so much individual suffering would not have been necessary. They proved insufficient. Gen. Jackson was reelected by a greatly increased vote. He subsequently directed, for reasons which he believed to be sufficient, that the public deposites, then amounting to a comparatively small sum, should be removed from the Bank, in pursuance of an express power contained in the charter. For the purpose of compelling Congress to direct their restoration, another contraction so severe was produced by the Bank as to throw most of the other banks and the individuals dependent on them into deep consternation and embarassment. Was not this distress, then, clearly produced by the tyranny of the Government? Ought the Bank of the United States to be regarded in any other light than as the unwilling instrument used by the President to harass and ruin the merchants and speculators ? But unfortunately these measures wholly failed. The Bank then in the course of only six months increased its accommodations more than twenty millions of dollars, and encouraged the other banks to a corresponding expansion. By producing a general rise of prices, from the abundance of paper currency in circulation, a multitude of preposterous speculations were inflated in every section of the Union, as well as a vast influx of importations induced from abroad. The immense amount of public lands purchased on speculation, and the duties accruing upon importations, brought into the banks in which the public money was deposited, according to the practice introduced into our political system by Hamilton, a great surplus revenue, which Congress, contrary to the advice of the President, directed to be divided among the States. This division compelled the banks to curtail their operations. Thousands upon thousands of individ- . uals, whose expectations of profit were founded upon the increase of the previous expansion, and consequent accelerated rise of prices, found themselves at once, not only deprived of their anticipated fortunes, but of the property they had before possesseil, in comply.
ing with the calls of the banks for the repayment of their accommodations. Who can doubt but they were ruined by the Executive, when it is remembered that this division of the deposites in banks among the States was the favorite measure of the supporters of the Bank of the United States, and, like the present project of Mr. Carey, was to proauce universal steadiness and security? Besides, to protect the banks, and through them their debtors from the common destruction in which the rage of gambling threatened to involve them, the President had endeavoured to prevent them from hazarding the public money, by ordering a strict compliance with the law which requires payment for public lands to be made in cash instead of bank credits as had been the practice under the government of the Bank of the United States. Was not this a flagitious interference by the Executive? Is it not justly called by the highest authority "tampering with the currency?" Who can doubt but the previous expansion was produced by the benevolent managers of the Bank of the United States, wholly from a patriotic desire to oblige their fellow citizens? And what inhumanity was manifested in endeavouring to enforce the long established laws of the land !
But unhappily, while the banks of this country were carrying on this prodigious expansion of paper currency and producing universal wealth and prosperity, the Bank of England was contracting its issues. To such a degree of scarcity was currency brought in the English market that the prices of our principal staples were suddenly reduced to less than one half of their former rates. The previous enormous importations under this state of things soon produced a large balance against this country which was required to be paid, not in paper currency, but in gold and silver--the only currency recognized in commercial transactions between nations. This produced a run for specie upon the banks of New York. They were compelled to suspend payments, and were immediately followed by most of the banks throughout the country. The credit system was at once plunged into the greatest jeopardy. Had it not been for the ingenious expedient of issuing the defunct notes of the former Bank which nobody could be compelled to redeem, the Bank of the United States must have forfeited its new charter from the State of Pennsylvania !
We have carefully examined Mr. Carey's publications for the purpose of finding evidence that this contraction of the Bank of England, which produced such disastrous consequences, was caused by the interference of our Executive with the Government of England. Unfortunately he has omitted to specify that important fact. He has assigned the importation of the foreign indemnities in gold, as the occasion of this visitation upon our banks, but unluckily the indemnities were not brought from England, and the hulk of those received from France and Naples were not remitted
until after the adoption of its restrictive measures by the Bank of England. Notwithstanding this slight discrepancy between cause and effect, how many of Mr. Carey's readers will doubt but the suspension of specie payments was designedly brought about by the Executive for the purpose of establishing “one currency for the Government and another for the people,” by means of “Sub-Treasuries, Receivers General, and Government paper ?”
Having thus endeavoured briefly and of course imperfectly to supply the obvious chasm in the additional illustrations given in the reply, of the disastrous consequences of the interference of Goyernment with paper currency, we leave to our readers to judge whether the ruinous fluctuations which within the last twenty years have swept away the fortunes and prospects of so many hundreds of thousands of our fellow citizens, have not been wholly owing to the imitation by our Government of the practices of the arbitrary monarchs of Europe.
The distinction on which the new scheme of Mr. Carey wholly rests—that excessive issues of paper currency are only destructive under a monarchical form of government, while steadiness and security are only disturbed in a republic by the interference of the Executive-is worthy of the doctrines it is brought to support. There is undoubtedly a wide difference in the practical operation of a government which employs its authority and power in defrauding and oppressing its subjects, and the theory of self-governmen' which prevails in this country. But there can be no essential dif. ference between them as to the proper medium of commercial interchange. The necessity for that healthy circulation which sustains industry by protecting its rewards, while its debasement and corruption paralyze the energy of every pursuit, must be the same under any system of government which is entitled to the name It is quite as ridiculous to allege that a similar paper currency is beneficial under a popular form of government, and destructive under a monarchy, as it would be to contend that the same kind of diet will be salutary to the physical system in one and poisonous in the other. Mr. Carey not only admits, but produces several examples in addition to those we had adduced, to show, that paper currency issued and received as money under the sanction of a monarchical government, whether through the medium of banks or otherwise, is a palpable cheat, and has invariably led to the impov. erishment of the many for the aggrandizement of the few. But he furnishes no explanation of the mode by which these evils resulting from its uses, are to be avoided under a form of government like ours.
In expatiating in vague and general terms upon the steadiness and security which he assumes will be derived from the general issue and receipt of paper currency by "the whole people," in a country where they are the controlling power, he has entirely