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PUBLIC CURRENCY..

No subject possesses a higher practical importance to every individual of whatever pursuit or condition, than the public measure of value. The security of those who have property, and the livelihood of those who have none, mainly depend upon its stability. Though the people may enjoy theoretic power of self-government, yet by surrendering the control of the actual measure of value to irresponsible individuals, associations, or corporations, they in fact enslave themselves. For whoever possesses the power of taking the property or means of subsistence of any portion of the community without their consent, become in fact their absolute masters.

The leading article of the London Quarterly Review for January of the present year-the great organ of the Conservative party which is now struggling for the political control of the British Empire-emphatically asserts that the experiment of self-government by the people, has totally failed in this country. When we find ourselves taunted before the world by the satellites of the corrupt aristocracy of England with the perversion of the principles of our form of government, it becomes the duty of every American citizen who is worthy of the name, to ask himself, whether any ground in fact exists for this reproach, which is intended to bring odium upon the great cause of liberty.

At the outset of our government, a deep laid plan was devised for counteracting the principles of the Constitution of the United States, by the false and fraudulent policy by which the people, the industrious producers, of so many nations have been impoverished, and practically enslaved, for the purpose of gratifying the luxury, and of promoting the personal aggrandizement of the few, through the control over the property and subsistence of the people which the paper system gives to its managers. Our first President felt himself most reluctantly obliged to sanction the charter of the first Bank of the United States. But the secret devices of the enemies of equal rights were exposed to the view of our citizens with sur. passing ability by Jefferson, Madison, and John Taylor, of Caroline-that trio of great men, whose abilities and public services were of such inestimable value to the cause of Democracy, and of. whom Virginia has so much reason to be proud. These apostles of rational liberty exposed the flimsy pretexts under which the

* Report of the Committee of Finance upon the answer of the Secretary of the Treasury to a resolution of the Senate of the 4th of January, 1839, requiring him to communicate any authentic information he may have recently received in respect to the modes of collecting, keeping, and disbursing public moneys in foreign countries. Senale Document, No. 113, third session, 25th Congress.

self-created aristocracy, during the earlier stages of our Government, had attempted to pervert our free institutions into engines of personal aggrandizement, wholly inimical to the purposes for which they had been established. The subtle machinery of the paper system could not be made sufficiently mysterious to conceal the snares which had been contrived for the subjugation of the people. The Democracy appreciated the designs of the papermoney speculators, and the political ascendancy they had at first obtained quailed before the light of truth.

Subsequently to that eventful period, the embarrassments into which the paper-money power succeeded in involving the public finances during the war, afforded another opportunity for grasping the control of the productive industry of the country. Under a similar pressure of necessity which had compelled Washington to grant his reluctant assent to the charter of the first Bank of the United States, Madison was induced to sanction that of the second. The previous departure from the principles of the Constitution, by authorizing the receipt of paper currency into the public treasury, had so generally expelled specie from circulation, that this great statesman was most unwillingly compelled to bow to the circumstances in which the country had become entangled, in order to carry on the Government.

The security of property, which the operations of the paper system have so repeatedly and ruinously invaded, was the ground of the Revolutionary contest. The tax of two pence per pound upon tea was not a consideration in itself worthy the notice of our sagacious fathers. Had it been acquiesced in, not an old lady throughout the continent would have been compelled to forego its indulgence upon any possible occasion. But this tax, ludicrously insignificant as it was in amount, involved the whole question whether the people of the colonies possessed the control of their own property, or whether it belonged to the British Government. It was therefore a question of liberty or slavery.

Currency involves the same question in a more complicated form. A false and fraudulent measure of value imposes burdens upon the community quite as substantial as, and, when carried to the extent it frequently has been in this country within the last twenty years, tenfold more destructive to the security of property than any system of direct extortion which would be tolerated among an intelligent people. An individual may protect himself from being rob bed on the highway by his personal prowess-he cannot secure himself from plunder through the means of a false and fraudulent measure of value of which the use is recognized by law, but by contending against all the rest of the community. Any person who will calmly consider the immediate effects of the simultaneous suspension of specie payments by the banks in 1837, and the loss

which was at once incurred upon the immense amount of contracts previously entered into, which were paid in currency depreciated from ten to forty per cent. in different sections of the country, will judge whether, under the relative plentifulness and scarcity of currency produced in the same manner, these consequences have been over-stated.

Many compliments have been from time to time bestowed upon the patience and forbearance of the people under the sufferings caused by this infliction, and the measures adopted to bring it about. Those who profited by this gigantic fraud can well afford to bestow a few cheap flatteries upon their victims by way of soothing and preparing them for the next revulsion.

On this occasion we cannot refrain from alluding to a fact connected with the late suspension of specie payments, to which the attention of the public has never been sufficiently drawn, and which throws a flood of light upon the measures which produced it. The charter obtained by the Bank of the United States from the Legislature of Pennsylvania, at the commmencement of 1836, contains a provision which every citizen of that State, excepting the few who were admitted into the secret, had the strongest grounds for believing would inevitably cause the forfeiture of the charter in case the bank should for three months refuse to redeem its currency in specie. When the occasion called for its application, it was found that so far from affording the slightest protection for the interests of the community, this provision had been carefully drawn up in evident contemplation of the suspension which took place more than a year afterwards, and instead of insuring the payment of the currency of the bank, under the expected penalty, effectually secured the bank against the legal consequences of its violation of the most sacred of obligations. It was accordingly empowered to trample upon the rights of property with impunity for more than a year and an half—and its final reluctant resumption was not occasioned by this penal provision, but by the overpowering force of public indignation. We do not propose to state the judicial decisions of the courts of Pennsylvania on this most important question. They are however worthy of the serious examination of legislators, whenever enactments intended to guard the community against frauds are under consideration.

Among the greatest improvements which the general use of paper currency has introduced among us, must be reckoned the entire reversal of the position of borrowers and lenders. Those who borrow the fruits of labor by the issue of paper currency, assume the guise of actual capitalists, upon whom the industry of the country is made dependent for support. The fallacy of the arguments which impose upon bustling, unthinking men, and lead them to uphold a false and fraudulent measure of value by which they

are exposed to so many losses and inconveniences, would be at once perceived, were it not for the complexity of the operations performed by paper currency, which enables its manufacturers to practice the grossest impositions upon the community without de tection.

An amusing illustration of this recently appeared in one of the daily papers, drawn up in law French, which probably added little to the facility of perceiving the ingenuity manifested in this report of a case, the like of which might, within these last two or three years, have arisen out of numerous transactions, somewhat similar, on a larger scale. We give its substance because it deserves to be more widely known as a familiar and striking specimen of the mode of reasoning upon currency, which perplexes and misleads so many well-meaning individuals. A person called at a bootseller's shop, purchased a pair of boots at the price of seven dollars, and offered a bank note of fifty dollars in payment. Not having sufficient money on hand to refund the balance due the purchaser, the seller stepped into a neighbouring establishment, and got the fifty-dollar note exchanged for an equal amount in small notes. After receiving his forty-three dollars, the purchaser went away, and was not afterwards heard of. The next day the fifty-dollar note was ascertained to be a forgery. The individual who had exchanged it required the sum advanced upon it to be refunded, which was accordingly done by the bootseller. Lamenting his loss to one of his customers, the latter agreed to indemnify him for a certain stipulated sum,-but it being found impossible for the parties to agree upon the amount of this loss, an action was brought upon this promise of indemnity, the bootseller claiming to have lost a hundred dollars. His first counsel insisted that he was entitled to the fifty dollars which he had repaid to his neighbour, to the forty-three dollars which he had given the purchaser in change, and the price of the boots, seven dollars, for which he was paid only by the forged note-making the hundred dollars which he demanded. The first counsel of the defendant, on the other hand, insisted that the loss was but fifty dollars, being the price of the boots, and the sum paid to the purchaser in change; while the second counsel of the defendant maintained that the actual loss was but seven dollars, which he undertook to prove by an ingenious process of reasoning, too long for our limits. The remaining counsel for the plaintiff contended that he had lost the fifty dollars refunded, and the forty-three dollars paid to the pur. chaser, making ninety-three dollars; the boots he admitted had been paid for, and he did not claim their price. The question proving too difficult to be readily settled by the tribunal before which it was depending, the opinions of the members of the bar present, not employed in the case, were asked. The first was of

opinion that the true sum lost was fifty-seven dollars, being the price of the boots, which he considered to be unpaid, together with the amount refunded by the seller to his neighbour. The second, that the actual loss was forty-three dollars, payment having been made for the boots, and the sum lost was merely the amount carried off by the purchaser; while the third maintained with great earnestness that the amount lost was, first, fifty dollars, being the amount of the counterfeit note; secondly, the sum the bootseller refunded to his neighbor, fifty dollars more; and lastly, the price of the boots, seven dollars, having never been paid for, but by the counterfeit note without value-making one hundred and seven dollars. The difficulty originally attending the decision only thickened under these elucidations-and the question appears to have been postponed.* We have met with several individuals whose pursuits led them to believe themselves fully acquainted with the subject of currency in its practical bearings, whose notions upon the office performed by bank notes led to quite as absurd consequences as those of some of the lawyers on this occasion. Sensitive as the established order of society has always shown itself to be, in all countries, in relation to paper currency, few persons, even of those who have attempted to enlighten the public on the subject, appear to have been disposed to form clear and accurate views upon it, and the mass of most communities have, in consequence, been subject to the grossest impositions.

The document which has led to these remarks upon paper currency contains the most satisfactory and authentic account of the practical operation of an exclusively metallic currency, on a large scale, that we have ever met with. It seems that the Secretary of the Treasury, soon after the adjournment of the last session of Congress, addressed a circular letter to our consuls at the most important ports abroad, requesting answers to a set of queries upon the mode of collection, custody, and disbursement of public money which prevailed in their respective neighbourhoods. When the call upon him for this information was made by the Senate, replies appear to have been received from the consuls at London, Liverpool, Glasgow, Dublin, Paris, Hamburg, Bremen, Carthagena, Kingston, in Jamaica, and Havana, which fully explain the checks and facilities under which the revenues of the three great nations are collected, which, at different periods during the last two centuries, have

* In addition to the anonymous instances of “members of the bar" here alluded to, as so completely bewildered upon any subject involving the manifold mystifica tions of paper-money, we could name an individual of deservedly distinguished professional character, who has long occupied a highly respectable place on the bench of the United States' judiciary, whose opinion on the case here described was, that the loss sustained was a hundred and seven dollars. We make the allųsion only in illustration of the real and important truth shadowed forth rader the parable of this supposed fictitious case of the pair of boots.

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