SENATE.] Bank of the United States-Non-Renewal of the Charter. behavior, what may she not do when freed from all restraint and delivered up to the boundless cupidity and remorseless exactions of a moneyed corporation? [FEBRUARY, 1831. the hard money in the country is a still more considerable advantage. Under this system, the best of the Western banks-I do not speak of those which had no foundations, and sunk under the weight of neighborhood opinion—but those which deserved favor and confidence, sunk ten years ago. Under this system, the entire West is now undergoing a silent, general, and invisible drain of its hard money; and, if not quickly arrested, these States will soon be, as far as the precious metals are concerned, no more than the empty skin of an immolated victim. 7. To establish branches in the different States without their consent, and in defiance of their resistance.-No one can deny the degrad derogates from the sovereignty of a State; tramples upon her laws; injures her revenue and commerce; lays open her Government to the attacks of centralism; impairs the property of her citizens; and fastens a vampire on her bosom to suck out her gold and silver. 1. It derogates from her sovereignty, because the central institution may impose its intrusive branches upon the State without her consent, and in defiance of her resistance. This has already been done. The State of Alabama, but 6. To deal in pawns, merchandise, and bills of exchange. I hope the Senate will not require me to read dry passages from the charter to prove what I say. I know I speak a thing nearly incredible when I allege that this bank in addition to all its other attributes, is an incorporated company of pawnbrokers! The allegation staggers belief, but a reference to the charter will dispel incredulity. The charter, in the first part, forbids a traffic in merchandise; in the after part, permits it. For truly this instrument seems to have been framed upon the principles of contraries; one principle making and injurious tendency of this privilege. It ing limitations, and the other following after with provisoes to undo them. Thus is it with lands, as I have just shown; thus is it with merchandise, as I now show. The bank is forbidden to deal in merchandise-proviso, unless in the case of goods pledged for money lent, and not redeemed to the day; and, proviso, again, unless for goods which shall be the proceeds of its lands. With the help of these two provisoes it is clear that the limitation is undone; it is clear that the bank is at liberty to act the pawnbroker and merchant, to any ex-four years ago, by a resolve of her Legislature, tent that it pleases. It may say to all the merchants who want loans, Pledge your stores, gentlemen! They must do it, or do worse; and, if any accident prevents redemption on the day, the pawn is forfeited, and the bank takes possession. On the other hand, it may lay out its rents for goods; it may sell its real estate, now worth three millions of dollars, for goods. Thus the bank is an incorporated company of pawnbrokers and merchants, as well as an incorporation of landlords and land-speculators; and this derogatory privilege, like the others, is copied from the old Bank of England charter of 1694. Bills of exchange are also subjected to the traffic of this bank. It is a traffic unconnected with the trade of banking, dangerous for a great bank to hold, and now operating most injuriously in the South and West. It is the process which drains these quarters of the Union of their gold and silver, and stifles the growth of a fair commerce in the products of the country. The merchants, to make remittances, buy bills of exchange from the branch banks, instead of buying produce from the farmers. The bills are paid for in gold and silver; and, eventually, the gold and silver are sent to the mother bank, or to the branches in the Eastern cities, either to meet these bills, or to replenish their coffers, and to furnish vast loans to favorite States or individuals. The bills sell cheap, say a fraction of one per cent.; they are, therefore, a good remittance to the merchant. To the bank the operation is doubly good; for even the half of one per cent. on bills of exchange is a great profit to the institution which monopolizes that business, while the collection and delivery to the branches of all remonstated against the intrusion of a branch upon her. She protested against the favor. Was the will of the State respected? On the contrary, was not a branch instantaneously forced upon her, as if, by the suddenness of the action, to make a striking and conspicuous display of the omnipotence of the bank, and the nullity of the State? 2. It tramples upon her laws; because, according to the decision of the Supreme Court, the bank and all its branches are wholly independent of State legislation; and it tramples on them again, because it authorizes foreigners to hold lands and tenements in every State, contrary to the laws of many of them; and because it admits of the mortmain tenure, which is condemned by all the republican States in the Union. 3. It injures her revenue, because the bank stock, under the decision of the Supreme Court, is not liable to taxation. And thus, foreigners, and non-resident Americans, who monopolize the money of the State, who hold its best lands and town lots, who meddle in its elections, and suck out its gold and silver, and perform no military duty, are exempted from paying taxes, in proportion to their wealth, for the support of the State whose laws they trample upon, and whose benefits they usurp. 4. It subjects the State to the dangerous manoeuvres and intrigues of centralism, by means of the tenants, debtors, bank officers, and bank money, which the central directory retain in the State, and may embody and direct against it in its elections, and in its legislative and judicial proceedings. 5. It tends to impair the property of the citizens, and, in some instances, that of the States, by destroying the State banks in which they have invested their money. FEBRUARY, 1831.] Bank of the United States-Non-Renewal of the Charter. [SENATE. has paid up the amount of his subscription. This is the true principle. It has prevailed in Scotland for the last century, and no such thing as a broken bank has been known there in all that time. 6. It is injurious to the commerce of the States, | England failed in 1797, and the Bank of the (I speak of the Western States,) by substituting United States was on the point of failing in a trade in bills of exchange, for a trade in the 1819. The same cause, namely, stockjobbing products of the country. 7. It fastens a vam- and overtrading, carried both to the brink of pire on the bosom of the State, to suck away destruction; the same means saved both, nameits gold and silver, and to co-operate with the ly, the name, the credit, and the helping hand course of trade of federal legislation, and of ex- of the Governments which protected them. Yes, change, in draining the South and West of all the Bank of the United States may fail; and its their hard money. The Southern States, with stockholders live in splendor upon the princely their thirty millions of annual exports in cot- estates acquired with its notes, while the induston, rice, and tobacco, and the Western States, trious classes, who hold these notes, will be unwith their twelve millions of provisions and able to receive a shilling for them. This is tobacco exported from New Orleans, and five unjust. It is a vice in the charter. The true millions consumed in the South, and on the principle in banking requires each stockholder lower Mississippi,-that is to say, with three- to be liable to the amount of his shares; and fifths of the marketable productions of the subjects him to the summary action of every Union, are not able to sustain thirty specie-holder on the failure of the institution, till he paying banks; while the minority of the States north of the Potomac, without any of the great staples for export, have above four hundred of such banks. These States, without rice, without cotton, without tobacco, without sugar, and with less flour and provisions, to export, are saturated with gold and silver, while the southern and western States, with all the real sources of wealth, are in a state of the utmost destitution. For this calamitous reversal of the natural order of things, the Bank of the United States stands forth pre-eminently culpable. Yes, it is pre-eminently culpable! and a statement in the National Intelligencer of this morning, (a paper which would overstate no fact to the prejudice of the bank,) cites and proclaims the fact which proves this culpability. It dwells, and exults, on the quantity of gold and silver in the vaults of the United States Bank. It declares that institution to be "overburdened" with gold and silver; and well may it be so overburthened, since it has lifted the load en-pelled to sustain the federal bank; to prop it tirely from the South and West. It calls these metals "a drug" in the hands of the bank; that is to say, an article for which no purchaser can be found. Let this "drug," like the treasures of the dethroned Dey of Algiers, be released from the dominion of its keeper; let a part go back to the South and West, and the bank will no longer complain of repletion, nor they of depletion. 9. To have the United States for a partner.Sir, there is one consequence, one result of all partnerships between a Government and individuals, which should of itself, and in a mere mercantile point of view, condemn this association on the part of the Federal Government. It is the principle which puts the strong partner forward to bear the burthen whenever the concern is in danger. The weaker members flock to the strong partner at the approach of the storm, and the necessity of venturing more to save what he has already staked, leaves him no alternative. He becomes the Atlas of the firm, and bears all upon his own shoulders. This is the principle: what is the fact? Why, that the United States has already been com with her revenues and its credit in the trials and crisis of its early administration. I pass over other instances of the damage suffered by the United States on account of this partnership; the immense standing deposits for which we receive no compensation; the loan of five millions of our own money, for which we have paid a million and a half in interest; the five per cent. stock note, on which we have 8. Exemption of the stockholders from in- paid our partners four million seven hundred dividual liability on the failure of the bank. and twenty-five thousand dollars in interest; This privilege derogates from the common law, the loss of ten millions on the three per cent. is contrary to the principle of partnerships, and stock, and the ridiculous catastrophe of the injurious to the rights of the community. It is miserable bonus, which has been paid to us a peculiar privilege granted by law to these with a fraction of our own money: pass over corporators, and exempting them from liability all this, and come to the point of a direct loss, except in their corporate capacity, and to the as a partner, in the dividends upon the stock amount of the assets of the corporation. Un-itself. Upon this naked point of profit and happily, these assets are never assez, that is to say, enough, when occasion comes for recurring to them. When a bank fails, its assets are always less than its debits; so that responsibility fails the instant that liability accrues. Let no one say that the Bank of the United States is too great to fail. One greater than it, and its prototype, has failed, and that in our own day, and for twenty years at a time: the Bank of loss, to be decided by a rule in arithmetic, we have sustained a direct and heavy loss. The stock held by the United States, as everybody knows, was subscribed not paid. It was a stock note, deposited for seven millions of dollars, bearing an interest of five per cent. The inducement to this subscription was the seductive conception that, by paying five per cent. on its note the United States would clear four SENATE.] Bank of the United States-Non-Renewal of the Charter. [FEBRUARY, 1831. or five per cent. in getting a dividend of eight | its hug, as well as from its blow. I wish to or ten. This was the inducement; now for the provide against all risk, and every hazard; for, realization of this fine conception. Let us see if this risk and hazard were too great to be enit. Here it is: an official return from the countered by King, Lords, and Commons, in Register of the Treasury of interest paid, and Great Britain, they must certainly be too great of dividends received. The account stands to be encountered by the people of the United thus: States, who are but commons alone. Interest paid by the United States, $4,725,000 Loss to the United States, Bank of the United States" is the Bank of the 10. To have foreigners for partners.-This, Mr. President, will be a strange story to be told in the West. The downright and upright peo95,574 ple of that unsophisticated region believe that Disadvantageous as this partnership must be words mean what they signify, and that "the to the United States in a moneyed point of view, United States. How great then must be their there is a far more grave and serious aspect under which to view it. It is the political aspect, astonishment to learn that this belief is a false resulting from the union between the bank and conception, and that this bank (its whole name the_Government. This union has been tried to the contrary notwithstanding) is just as in England, and has been found there to be much the bank of foreigners as it is of the Fedjust as disastrous a conjunction as the union of eral Government. Here I would like to have church and State. It is the conjunction of the the proof a list of the names and nations, to lender and the borrower, and holy writ has establish this almost incredible fact. But I told us which of these categories will be mas- from one of these I learn as much as will have no access except to public documents, and ter of the other. But suppose they agree drop rivalry, and unite their resources. Sup the Committee of Ways and Means, in the answer the present pinch. It is the report of pose they combine, and make a push for politi- House of Representatives, for the last session cal power: how great is the mischief which they may not accomplish! But, on this head, of Congress. That report adınits that foreignI wish to use the language of one of the bright-ers own seven millions of the stock of this est patriots of Great Britain; one who has shown himself, in these modern days, to be the worthy successor of those old iron barons Thus it is proved that foreigners are as deepwhose patriotism commanded the unpurchase-ly interested in this bank as the United States itself. In the event of a renewal able eulogium of the elder Pitt. I speak of Sir William Pulteney, and his speech against the Bank of England, in 1797. to bank; and everybody knows that the Federal Government owns seven millions also. of the charter they will be much more deeply interested than at present; for a prospect of a rise in the stock to two hundred and fifty, and THE SPEECH-Extract.-"I have said enough to the unsettled state of things in Europe, will inshow that Government has been rendered depend-duce them to make great investments. It is to ent on the bank, and more particularly so in the time of war; and though the bank has not yet no purpose to say that the foreign stockholders fallen into the hands of ambitious men, yet it is ev- cannot be voters or directors. The answer to ident that it might, in such hands, assume a power that suggestion is this: the foreigners have the sufficient to control and overawe, not only the min-money; they pay down the cash, and want no isters, but king, lords, and commons. *accommodations; they are lenders, not borrowAs the bank has thus become dangerous to Gov-ers; and in a great moneyed institution such ernment, it might, on the other hand, by uniting stockholders must have the greatest influence. with an ambitious minister, become the means of The name of this bank is a deception upon the establishing a fourth estate, sufficient to involve public. It is not the bank of the Federal Govthis nation in irretrievable slavery, and ought, there- ernment, as its name would import, nor of the fore, to be dreaded as much as a certain East India States which compose this Union; but chiefly bill was justly dreaded, at a period not very remote. of private individuals, foreigners as well as I will not say that the present minister, (the younger Pitt,) by endeavoring, at this crisis, to take the Bank natives, denizens, and naturalized subjects. of England under his protection, can have any view They own twenty-eight millions of the stock, to make use, hereafter, of that engine to perpetuate the Federal Government but seven millions, and his own power, and to enable him to domineer over these seven are precisely balanced by the stock of our constitution: if that could be supposed, it the aliens. The Federal Government and the would only show that men can entertain a very dif- aliens are equal, owning one-fifth each; and there ferent train of ideas, when endeavoring to overset a would be as much truth in calling it the English rival, from what occurs to them when intending to Bank as the Bank of the United States. Now support and fix themselves. My object is to secure mark a few of the privileges which this charter the country against all risk either from the bank as gives to these foreigners. To be landholders, in opposed to Government, or as the engine of am- defiance of the State laws, which forbid aliens to hold land; to be landlords by incorporation, and to hold American citizens for tenants; to hold lands in mortmain; to be pawnbrokers and merchants by incorporation; to pay the revenue of the United States in their own bitious men." And this is my object also. I wish to secure the Union from all chance of harm from this bank. I wish to provide against its friendship, as well as its enmity-against all danger from FEBRUARY, 1831.] Bank of the United States-Non-Renewal of the Charter. [SENATE. notes; in short, to do every thing which I have endeavored to point out in the long and hideous list of exclusive privileges granted to this bank. If I have shown it to be dangerous for the United States to be in partnership with its own citizens, how much stronger is not the argument against a partnership with foreigners? What a prospect for loans when at war with a foreign power, and the subjects of that power large owners of the bank here, from which alone, or from banks liable to be destroy-be strangled in its birth for the shelter and ed by it, we can obtain money to carry on the war! What a state of things, if, in the division of political parties, one of these parties, and the foreigners, coalescing, should have the exclusive control of all the money in the Union, and, in addition to the money, should have bodies of debtors, tenants, and bank officers stationed in all the States, with a supreme and irresponsible system of centralism to direct the whole! Dangers from such contingencies are too great and obvious to be insisted upon. They strike the common sense of all mankind, and were powerful considerations for the old whig republicans for the non-renewal of the charter of 1791. Mr. Jefferson and the whig republicans staked their political existence on the non-renewal of that charter. They succeeded; and, by succeeding, prevented the country from being laid at the mercy of British and ultra federalists for funds to carry on the last war. It is said the United States lost forty millions by using depreciated currency during the last war. That, probably, is a mistake of one-half. But be it so! For what are forty millions compared to the loss of the war itself -compared to the ruin and infamy of having the Government arrested for want of money-institution. stopped and paralyzed by the reception of such a note as the younger Pitt received from the Bank of England in 1795 ? 11. Exemption from due course of law for violations of its charter. This is a privilege which affects the administration of justice, and stands without example in the annals of republican legislation. In the case of all other delinquents, whether persons or corporations, the laws take their course against those who offend them. It is the right of every citizen to set the laws in motion against every offender; and it is the constitution of the law, when set in motion, to work through, like a machine, regardless of powers and principalities, and cutting down the guilty which may stand in its way. Not so in the case of this bank. In its behalf, there are barriers erected between the citizen and his oppressor, between the wrong and the remedy, between the law and the of fender. Instead of a right to sue out a scire facias or a quo warranto, the injured citizen, with an humble petition in his hand, must repair to the President of the United States, or to Congress, and crave their leave to do so. If leave is denied, (and denied it will be whenever the bank has a peculiar friend in the President, or a majority of such friends in Congress, the convenient pretext being always at hand that the general welfare requires the bank to be sustained,) he can proceed no further. The machinery of the law cannot be set in motion, and the great offender laughs from behind his barrier at the impotent resentment of its helpless victim. Thus the bank, for the plainest violations of its charter, and the greatest oppressions of the citizen, may escape the pursuit of justice. Thus the administration of justice is subject to protection of this bank. But this is not all. Another and most alarming mischief results from the same extraordinary privilege. It gives the bank a direct interest in the Presidential and Congressional elections: it gives it need for friends in Congress and in the Presidential chair. Its fate, its very existence, may often depend upon the friendship of the President and Congress; and, in such cases, it is not in human nature to avoid using the immense means in the hands of the bank to influence the elections of these officers. Take the existing fact-the case to which I alluded at the commencement of this speech. There is a case made out, ripe with judicial evidence, and big with the fate of the bank. It is a case of usury at the rate of forty-six per cent., in violation of the charter, which only admits an interest of six. The facts were admitted, in the court below, by the bank's demurrer; the law was decided, in the court above, by the supreme judges. The admission concludes the facts; the decision concludes the law. The forfeiture of the charter is established; the forfeiture is incurred; the application of the forfeiture alone is wanting to put an end to the An impartial President or Congress might let the laws take their course; those of a different temper might interpose. their veto. What a crisis for the bank! It beholds the sword of Damocles suspended over its head! What an interest in keeping those away who might suffer the hair to be cut. 12. To have all these unjust privileges secured to the corporators as a monopoly by a pledge of the public faith to charter no other bank.This is the most hideous feature in the whole mass of deformity. If these banks are beneficial institutions, why not several? one, at least, and each independent of the other, to each great section of the Union? If malignant, why create one? The restriction constitutes the monopoly, and renders more invidious what was sufficiently hateful in itself. It is, indeed, a double monopoly, legislative as well as banking; for the Congress of 1816 monopolized the power to grant these monopolies. It has tied up the hands of its successors; and if this can be done on one subject, and for twenty years, why not upon all subjects, and for all time? Here is the form of words which operate this double engrossment of our rights: No other bank shall be established by any future law of Congress during the continuance of the corporation hereby enacted, for which the faith of SENATE.] Bank of the United States-Non-Renewal of the Charter. * [FEBRUARY, 1831. * It is obvious, from what passed before, that Parliament will never agree to it. * * * Congress is hereby pledged;" with a proviso | subject. Banks of this description must necessarily for the District of Columbia. And that no in- be conducted upon the generally understood and cident might be wanting to complete the title approved principles of banking. * The of this charter, to the utter reprobation of whig Bank of England may, perhaps, propose, as they did republicans, this compound monopoly, and the upon a former occasion, the extension of the term very form of words in which it is conceived, is of their exclusive privilege, as to the metropolis and copied from the charter of the Bank of Eng- of this concession, [immediate surrender of excluits neighborhood, beyond the year 1833, as the price land!--not the charter of William and Mary, as sive privileges.] It would be very much to be regranted in 1694, (for the Bill of Rights was gretted that they should require any such condition. then fresh in the memories of Englishmen,) but the charter as amended, and that for money, in the memorable reign of Queen Anne, when a tory Queen, a tory Ministry, and a tory Parliament, and the apostle of toryism, in the person of Dr. Sacheverell, with his sermons of divine right, passive obedience, and non-resistance, were riding and ruling over the prostrate liberties of England! This is the precious period, and these the noble authors, from which the idea was borrowed, and the very form of words copied, which now figure in the charter of the Bank of the United States, constituting that double monopoly, which restricts at once the powers of Congress and the rights of the citi zens. Such privileges are out of fashion; and what expectation can the bank, under present circumstances, entertain that theirs will be renewed?"— Jan. 13. Answer of the Court of Directors.—Extract. "Under the uncertainty in which the Court of Directors find themselves with respect to the death of the bank, and the effect which they may have on the interests of the bank, this court cannot feel themselves justified in recommending to the proprietors to give up the privilege which they now enjoy, sanctioned and confirmed as it is by the solemn acts of the Legislature."-Jan. 20. Second communication from the Ministers.-Extract. These, Mr. President, are the chief of the exclusive privileges which constitute the monop- "The First Lord of the Treasury and Chancellor oly of the Bank of the United States. I have of the Exchequer have considered the answer of the spoken of them, not as they deserved, but as bank of the 20th instant. They cannot but regret my abilities have permitted. I have shown that the Court of Directors should have declined to you that they are not only evil in themselves, recommend to the Court of Proprietors the considbut copied from an evil example. I now wish eration of the paper delivered by the First Lord of to show you that the Government from which the Treasury and the Chancellor of the Exchequer we have made this copy has condemned the to the Governor and Deputy Governor on the 13th original; and, after showing this fact, I think instant. The statement contained in that paper apI shall be able to appeal, with sensible effect, cellor of the Exchequer so full and explicit on all pears to the First Lord of the Treasury and the Chanto all liberal minds, to follow the enlightened the points to which it related, that they have nothexample of Great Britain in getting rid of a ing further to add, although they would have been, dangerous and invidious institution, after hav- and still are, ready to answer, as far as possible, any ing followed her pernicious example in assum-specific questions which might be put, for the pur ing it. For this purpose, I will have recourse to proof, and will read from British state papers of 1826. I will read extracts from the correspondence between Earl Liverpool, First Lord of the Treasury, and Mr. Robinson, Chancellor of the Exchequer, on one side, and the Governor and Deputy Governor of the Bank of England on the other; the subject being the renewal, or rather non-renewal, of the charter of the Bank of England. Communications from the First Lord of the Treasury and Chancellor of the Exchequer to the Governor and Deputy Governor of the Bank of England. Extracts. pose of removing the uncertainty in which the Court of Directors state themselves to be with respect to the details of the plan suggested in that paper."Jan. 23. Second answer of the Bank.-Extract. "The Committee of Treasury [bank] having taken into consideration the paper received from the First Lord of the Treasury and the Chancellor of the Exchequer, dated January 23d, and finding that His Majesty's ministers persevere in their desire to proof the bank, as to the number of partners engaged pose to restrict immediately the exclusive privilege in banking to a certain distance from the Metropolis, and also continue to be of opinion that Parlia ment would not consent to renew the privilege at "The failures which have occurred in England, the expiration of the period of their present charter; unaccompanied as they have been by the same oc- finding, also, that the proposal by the bank of estabcurrences in Scotland, tend to prove that there lishing branch banks is deemed by His Majesty's must have been an unsolid and delusive system of ministers inadequate to the wants of the country, banking in one part of Great Britain, and a solid are of opinion that it would be desirable for this and substantial one in the other. # * * In corporation to propose, as a basis, the act of 6th of Scotland, there are not more than thirty banks, George the Fourth, which states the conditions on (three chartered,) and these banks have stood firm which the Bank of Ireland relinquished its exclusive amidst all the convulsions in the money market in privileges; this corporation waiving the question of England, and amidst all the distresses to which the a prolongation of time, although the committee [of manufacturing and agricultural interests in Scot- the bank] cannot agree in the opinion of the First land, as well as in England, have occasionally been Lord of the Treasury and the Chancellor of the Ex |