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overlooked the great principle of sovereignty which places them in the same position with regard to our institutions as the most absolute monarch within his dominions. Neither the continental paper issued by this country during the Revolutionary struggle, nor the Assignats of France received any increased worth from being issued by the authority of the people and for their benefit. Like every experiment made upon currency without intrinsic and universal value, from the foundation of the world—whether issued by kings or by people-by banks or by individuals—whether received for public taxes or not—whenever the amount of the continental paper or assignats was expanded beyond the aggregate of the quantity of gold and silver currency which the necessities of the people would have required for commercial interchange, had there been no paper in circulation, they inevitably depreciated. Such is the universal effect of the operation of the great laws of trade. For this reason it has been always found impossible to prevent paper currency, costing nothing, and consequently prone to excess, from becoming an instrument of fraud upon the industrious and producing classes.Paper currency is no doubt convenient to a certain extent to the mercantile classes, but any use of paper currency is wholly a question between convenience on the one hand, and safety to the highest interests of the community on the other.

This important question has been conclusively settled by Mr. Carey in his reply to our Article. By empowering "the whole people” to manufacture paper currency which shall be received in all payments, its quality as a measure of value must be destroyed. This quality alone enables commercial men to employ it as a substitute for actual money. To enable every individual in the community to establish a measure of value for himself is therefore precisely the great improvement which according to Shakspeare, Jack Cade promised to his misguided followers. There shall be no more money," was the rallying cry put into the mouth of Cade by the great painter of human motives, as calculated to produce the most powerful effect upon a desperate band of disorganizers. We do not wish, however, to be understood as receiving the account of the poet as authority as to the facts of the attempted reform of the villeinage of the feudal system which was set on foot by popular desperation in England, France and the Netherlands at about the same period. But for the purpose of illustrating the most efficient springs of human action, we may, with the Duke of Marlborough, cite Shakspeare as the best writer of English history. Had the felicitous invention of paper currency as the means of overthrowing the established institutions of society, been introduced into England in his day, the incentives for the destruction of property put into the mouth of Cade would doubtless have been similar to those used by Mr. Carey for the increase of production and the diffusion of universal plenty without labor.

The process by which Mr. Carey seems to have arrived at this final consummation of practical agrarianism, furnishes the American people a most important lesson, which we hope will be hereaf. ter and constantly borne in the recollection of all who have witnessed the disordered condition of the currency and the exchanges during the last two years. In his famous letter of the 5th of April last, Mr. Biddle expressed his firm determination to remain behind his cotton bags, and to prevent all the banks in the country from resuming specie payments, "until the enemy should be driven from the country"-meaning in plain language that he would continue to in ict distress upon the people and involve their productive interests in the manifold embarassments occasioned by the want of a sound currency, until our citizens should be compelled to elect rulers who were ready to 'recharter his bank as the means of relief, and invest it with the absolute control of the public finances. As this avowal, for the character of which we find some difficulty in selecting a suitable epithet, created no little consternation among some of the firmest but honest supporters of the Bank, the publication of Mr. Carey which occasioned our former Article appeared, vindicating the course of the banks for refusing to fulfil their solemn obligations by the redemption of their issues; and demonstrating by his ordinary mathematical formulas, that confidence alone, and not specie, was the true basis of paper currency. This "confidence" he asserted to be essential to enable the banks to resume their proper functions towards the community.

But the main element of this "confidence” he maintained to be the countenance and support of the Government towards the banks. Until the present Administration should be expelled from power, and a new one elected by the people who would adopt the paper currency of the banks as the universal measure of value, he not only earnestly contended, but demonstrated in his peculiar manner, that the depreciation of bank paper must be continued, and the activity and prosperity of the country remain paralyzed. It was this torrent of wholesale deception which we undertook to turn into its proper channel in our former article.

Not finding it precisely convenient to encounter the positions taken in that Article, derived from'the universal experience of the employment of bank currency by the great governments of Earope, Mr. Carey in the reply turns suddenly round and jumps into the identical channel of argument marked out by us, and affects to coincide entirely with our views of the destructive influence of paper currency under monarchical governments. Though the whole drift and design of his former publication was to shew the necessity of the interposition of our Government to sustain the corrency of the banks by receiving it, however depreciated, in all public payments, he now discovers that it is the arbitrary interference of the government alone which has produced such disastrous results, from the use of paper currency in Europe! Where the people are themselves the sovereign power, as in this country, he finds that unrestrained issues of irredeemable paper are universally beneficial !

Now it strikes us that there is an obvious clue to this new discovery made by Mr. Carey. A kind of management wholly different in its form and object is essential to produce unlimited issues of paper money under the two descriptions of government. absolute king has only to a:1thorize the issue of paper, and it is at once effected, whatever may be the interests or opinions of his subjects. But where the people are themselves the actual governing power, as in this country, it becomes indispensable first to convince them that their interests will be promoted by exposing them to this hazard. Would our patriotic fathers have tolerated the paper cur. rency which brought upon them so many privations, had they not believed that its issue was imperiously required by their paramount interests? Assignats were issued by the French people under a similar view of the necessities of the emergency. In both instances the ultimate effects of this fraudulent system were overlooked under the pressure which existed for the immediate provision of currency to furnish the means of defence against their enemies.Had not the evils of the system been inherent, the principle upon which the Assignats were issued afforded the strongest guarantee against depreciation. The national domain of France, possessing immense value, was pledged for their redemption, and was thrown into market for that purpose, Assignats being received in payment. In this respect they closely resembled the currency lately issued under the provisions of the Free Banking Law of New York.The redemption of this currency is ostensibly secured by the deposite of stocks and mortgages. But whenever a period of difficulty and distrust shall arise, in consequence of the inflation of paper currency, either with or without such security, a demand for specie will take place for exportation. A panic must soon prevail. During the destruction of confidence of which we have witnessed so many instances from the same cause, it will probably be found impossible to sell the stocks and mortgages pledged for the redemption of these issues. Their discredit will then become inevitable. But even this security, insufficient as we fear it will prove, wholly conflicts with Mr. Carey's views of the advantages to be derived from paper currency. To avoid all possible imputation of overstating his present notions, we will give his language on this point. He now says:

· The steadiness and security of the currency are in the direct ratio in which the people are free to exercise the trade of Banking and the right of furnishing currency-that the unsteadiness and insecurity which have existed have been the result of the interference of Governments therewith-and that the remedy therefor was to be found in the abolition of restrictions."

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And after giving a distorted view of the legislation of some of the States—too preposterous to impose on any citizens of this country he adds:

“New York has now gone further and has passed a general law under which all may associate for banking purposes, and for the supply of eurrency without application to the Legislature, so that the people of that State have now obtained almost entire freedom in regard to the trade in money. We say almost because even in that law there are regulations that will tend to prevent the action under it from being as advantageous as it otherwise would be."

Now we profess to be totally opposed to monopolies in every shape and form. We are strongly in favor of free trade in banking, and every other pursuit calculated to afford real facilities to the legitimate pursuits of industry and commerce. But every person of reflection who either possesses property or hopes to possess any, must feel after the experience of the last two years that the measure of value cannot be safely trifled with by currency doctors either with or without charters. If, in the present state of things, paper is to be issued and received in payment, its practical redemption ought to be secured by the most efficient checks. Under the operation of such checks the industrious and unprotected classes might safely receive paper currency-but without them, they should refuse every thing as currency but gold and silver. Where paper currency is practically intended to be redeemed in specie, its issue would afford a comparatively small degree of profit, to that derived from a state of continual fluctuations. The most important and useful banks in Europe have always been those which pay out no currency for general circulation but gold and silver. Even in England, oppressed as her productive interests now are by the incubus of the paper system which has grown out of the operations of the Bank of England, a large proportion of the Joint Stock Banks which within the last twelve years have arisen from the relaxation of that great monopoly, have voluntarily stipulated to issue no currency but that of the Bank of England, for which they pay the rate of interest ordinarily charged upon its loans. They have wisely preferred a dimunition of their profits to encountering the hazards incident to the redemption of paper currency during those periodical revulsions which the prevalence of the system inflicts upon every country where it has been permitted to take root. But the “right of issuing paper currency” without effectually securing its prompt redemption in gold and silver, which is evidently Mr. Carey's notion of Free Banking, is merely another name for free swindling. The design of his former publication was shewn in our former Article to be, to reconcile the citizens of this country to measures which might promote the scheme which has been long chere ished, and at some periods has nearly succeeded—of banishing the use of gold and silver as currency from among the people of the United States; and not the slightest symptom of a denial of this intention can be discovered in the reply.'

As he has no where favored the public with any exposition of the mode in which he proposes 10 secure the convertibility of paper currency, the perfection of which, according 10 his former publication rests on confidence, and not on the assurance of its redemption in specie, we may presume, upon the avowal contained in Mr. Bid. dle's letter, that the design of the Philadelphia school, of pushing paper currency into exelusive use among the people, still exists, for the double purpose of defrauding all our productive interests by its depreciation, and of exercising political control by means of the embarrassments into which it enables them to involve the people. We have no great faith in Mr. Biddle's formal abdiction of political power. Though the late scenes at Harrisburg were concerted before his declaration was published, the attempt at consummating that stupenduous outrage was made afterwards. Whenever the proper degree of expansion of paper currency has been reached, a necessity will be created for the charter of the United States Bank by Congress quite as urgent as that which existe last year.

The currency to be furnished by “ the whole people,” which is eulogized by Mr. Carey with so much enthusiasm, seems to be simply the resurrection of the shin-plasters which during so long a period expelled all sound currency from general circulation. After the experience enjoyed by the public within the last two years, we are induced to believe that those who did not participate in the profits of that admirable contrivance—which it seems, in Philadelphia at least, was ready for operation in advance of the suspension of the banks—are pretty well satisfied that even the Gold Humbug, the subject of so many refined witticisms, is on the whole " the better currency."

It may be urged that the evils growing out of this kind of paper currency will invariably cure themselves by their very excessthat the public will not permit itself to be cheated, and its highest interests trodden under foot beyond a certain point that every body may be permitted to issue paper currency, since no body is obliged to receive it in payment.

All this is unquestionably true. But this is not the ohject ained at by the paper currency speculators. Every body now possesses the full power of issuing paper currency, but the great trouble is, nobody is obliged to receive it. A further step is, therefore, required to accomplish Mr. Carey's views. It is so trifling and casy, that its refusal may well occasion all the clamor which has been excited against the interserence of the Government with paper currency. It is only to receive all paper currency, by whomsoever issued, in payment for public lands, public taxes, and public dues of every description. Any government which would refuse so small an accommodation ought, indeed, to be denounced as hostile to the banks, to the merchants, and to the people!

VOL. V. No. XIV.-FEBRUARY, 1839.


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