Columbia telescope. (Columbia, S.C.) 1828-1839, October 28, 1837, Image 1
BY A.S. JOHNSTON.
NEC DEESSE, NEC SUPERESSE REIPUBUCJI
PUBLISHED WEEKLY.
TOL. 33"KOi 48
COLUMBIA, S.C. OCTOBER 88, 1837.
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SPEECH
Of MR. KING, of Georgia, on the Bill im
posing additional duties, as depositaries,
in certain cases, on Public Officers.
IN SENATE.
September 23, 1337.
After some strong and pungent remarks
upon the failure of the Pet Bank system
though he admitted that it might have done,
and still could do, much better than hereto
fore, if the Executive would consent to let it
alone, and cease the continual interferences
by which the banks have been tormented, and
the commerce of the country deranged, ever
since the Execctive had taken the control of
the finances.
Mr. K. then proceeded to notice the plan
of the ^committee as proposed to be amended.
This he looked upon as a new experiment,
though it had been alleged to be otherwise by
the Senator from Missouri. The Senator in
sisted that we were ahead of our destiny, and
ought to go back to the glorious days of the
Roman empire to learn lessons on finance and
political economy. This plan was strongly
recommended as having been that under
which the Roman quaestors made their mUd
exactions from the people. It was also re
commended most warmly by the Senator,
because it was that under which the war levies
of Napoleon were made, and the finances of
Spain and Turkey collected and disbursed. ?
Upon the first recommendation, the Senator
had given us a most eloquent discourse upon
Roman heroism ; bloody battles, and the levies
of the quaestors. He had spoken of the great
pleasure with which he read Roman history
on these subjects, and the delight with which
he contemplated the renown of this great peo
ple. Well: Mr. K. said he had read some
Roman history too, though certainly not 3s
good an historian as his friend from Missou
ri. But if any thing in Roman history had
made a strong impression upon his republican
mind, it was the heartless cruelty, the un
feeling rigor, and tyranny with which -exac
tions were made upon the people by the Ro
man quaestors; and unfortunately for the Sen
ator's Roman precedent, when these exactions
had been made by plundering the Roman
people and provinces to support heroism in
the trade of conquering and plundering the
rest of mankind, these exactions were deposited
with Roman bankers appointed for the pur
pose.
As the Roman precedent was not found
exactly satisfactory to Mr. R. he proceeded
to notice the system so warmly recommended
as the plan of that great democrat and ardent
lover of liberty and free institutions, the Em
peror Napoleon- His friend from Missouri
had stated that when the Emperor mounted
the throne of power, he found the State Cof
fers empty, or nearly so; but in a short time
they were filled to overflowing. Thereupon
the Senator produced a book, or a document,
to prove the important fact. The fact was
not doubted; but how were these wonders of
finance accomplished? Let his impoverished
country and the blood and tears of unhappy
Germany answer the question. However,
perhaps the financiering of this great econo
mist was strongly recommended from the fact
that the largest and most timely accession to
his finances was made by the robbery of the
bank ; and that too a bank belonging to one
of the freest and most commercial cities of
'Europe.*
Mr. K. said he saw nothing in these Impe
rial precedents, ancient or modern, very ap
plicable or very captivating ; and as he saw
nothing in the happy and prosperous con
dition of the People of these free and com
mercial nations, Turkey and Spain, to ex
cite his envy, he would rather consider this
as a new and untried experiment, and digest
it a little better before it was adopted. Sfr.
K. added, that the System was already in
operation, as the changes proposed did not
alter essentially the specie system adopted by
the Executive since the suspension of specie
payments. The postponement would give us
a little more time to observe the workings of
the system, and ascertain the wishes of the
People. He was glad to see the finances res
tored to Congress, their lawful guardian; on
almost any terms; but really they were in such
a worthless and ragged condition, from Exe
cutive manipulation, that it was difficult to
say what disposition had better be made of
them.
Mr. K. said he doubted whether he ought
.to detain the Senate to say any thing upon the
vcauses of the present distress, which had call
ed Congress together. As this subject had
been dwelt upon however, by every speaker
who had preceded him, and was certainly of
great importance to the-country,it was perhaps
the duty of every member te give his views up
on the subject, The subject, said he, is too
important to the trifled with. It comes to the
doors and dwellings, and reaches the bread
and business, of every citizen, of every condi
tion; aud I shall give my views, however un
willingly, uninfluenced by all personal friend
ship and party associations. Unless we as
certain the causes which have so strangely
brought the country into its present distressed
condition, in a time of profound peace, we
shaU neither know how to apply present rem
edies n?r avoid similar evils in future.
Mr. K. then said he had not the slightest
doubt that our difficulties were owing entire
ly to the* unfortunate policy and violent mea
sures of the Executive in relation 19 the finan
ces for several years past. This was the only
cause, and this was abundantly sufficient. ?
* Hamburg.
Mr. K. said he could prove this to any one
who would not shut his eyes to facts, and
close his understanding against correct in
formation on the subject. He had felt and
expressed his astonishment when he first read
the Presidents message, at the Statements of
the President in relation to these causes; and
he had been equally astonished at hearing his
friends from Connecticut and North Carolina
adopt these statements, and take them as ad
mited truths. The President was entirely
mistaken in these statements, and to allow
them to remain uncorrected would only con
tinue to obscure and mystify the subject.
Mr. K. then read a passage from the Pre
sident's Message.
Now, that over-banking, over-issuing, &c.,
as mentioned by the President, have been
operating causes, is only a common belief.?
But where did they originate, and who pro
duced them? That is the first question.
And here Mr. K. stated that the President
was mistaken in every fact assumed by him to
exculpate our own Government from the charge
of bemg-the -original cause of the mischief.
Other countrieshave been suffering no "evils
similar to those suffered by ourselves," ex
cept those which they have suffered by their
connexions icitk and losses by us. And "a
reference to the amount of banking capital,
and the issues of paper credits, put in cir
culation in Great Britain, <fcc., during the
years 1834, 1835, and 1836." will not "show
an augmentation of the paper currency
there, as much disproportioned to the real
wants of trade as in the United States."
Nor has there been in England any general
rise of prices ; nor do we witness "in both
countries the same redundancy of paper
money, and other facilities of credit," or
"the same spirit of speculation." These
positions of the President are entirely errone
ous, and the facts he supposes have not a
shadow of existence.
He said he did not, of course, make these
contradictions in an offensive sense or in a
way disrespectful to the President. He had
been in favor of his election, and did not re
gret it. He moreover believed him to be a
man of patriotism and integrity, as well as
intelligence, and he hoped to be able to sup
port his Administration. But if he was (as
he was doubtless) a "sincere inquirer after
truth," he would be glad to be corrected in
views calculated to deceive the People, and
divert their minds from the true agency
by which they have been overwhelmed. ?
The President's "difference," in fact, ought
to have shown him where the fault lay.?
He states that <be nation has become bank
rupt. The other sustained itself, and is now
nearly recovered. Why this "difference ?"
Why, simply because ours is the distress of
the debtor unable to pay the debt ; theirs
is the distress of die creditor for want of the
money due him. The creditor of a bank
rupt is frequently much injured for want of
his money, but it does not necessarily follow
that he also fails. And in no case is hftj
chargeable with the follies and extravagancies
that brought about the disaster. He may
have been too confiding, but there his fault
ends. The injudicious prodigal, with bad
advisers, may contract debts, multiply obli
gations, make experiments, and become em
barrassed and bankrupt. The confiding
neighbor who trusted him too far may feel
sensibly the want of his debt, be obliged to
curtail his expenses, or otherwise econo
mize for a while ; but, being the creditor, and
therefore most likely the richer of the two,
he is not so likely to be ruined. [Here Mr.
K. read an extract of a letter from a gentle
man of Liverpool, stating that "there is no
distress in ?ngland except that which grows
out of American connexions : and that is
passing off, though much of the debt re
mains unpaid."] ?ngland, we are told from
all quarters, is now easy, and, with an abun
dance of capital, prepared to make invest
ments, and engage in new enterprizes. Tel
a mere check to the lavish accommodations of
the capitalist , by the embarrassment of his
debtor , is analogized with the utmost compla
cency to the prostrate and helpless condition of
his bankrupt debtor himself! !
Those, he said, who insisted that the
national distress could not have been occa
sioned by the acts of our own Executive, be
cause there had been some distress in those
commercial nations, with whom we trade,
put him in mind of that great philosopher
who stumped his toe in the darkness of mid
night, and railed out against the sun for not
shining in the night instead of the day:
alleging as the result of his most profound
observation, that there was light enough in
the day without him. They confounded cause
and consequence, and lost all connexion
between them. It never occurred to the
philosopher that the sun might itself be the
cause of light, and these gentlemen cannot
see our own agency in producing this em
barrassment abroad, though the one agency
is just about as plain as the other.
Mr. K. said he would try and remove the
difficulty of those who felt so much embar
rassment on this subject by proving ?
1. That there had Seen no redundancy of
the currency in England between 1834 and
1837 ; but, on the contrary , the value of money
during this period had greatly increased , by
the increase of national wealth , whilst currency
remained about stationary.
2. That there had been in England no
national overtrading, and that her exchanges
had been depreciated by receiving our credit
in exchange for her cash and commodities.
3. That our extraordinary, but speculative,
demand for the products of English labor
had created some activity, especially to the
manufacturing interests. ? Our increased de
mand for the products of their labor, coun
teracting our unnatural credit demand for
their money also ; and, thereby, only main
taining prices which otherwise ( so far from a
speculative rise ) would have been depreciated
by an appreciation of money.
These propositions, Mr. K. said, would
rather astonish those who bad taken it for
granted, without inquiry, that by some magi
cal fatality the whole worl<^ had been guilty
of follv similar to our own, and visited with
similar punishment. But if they wotyld/
take leave of mere assumptions, stumr
speeches, party presses, and vagrant coi
tures, and be content with the plain evidf>fce
of their senses, he thought he wo?*14/f*"aiD~
. .?as#Ction of
tain every proposition to in*
all who would listen f % ^
On the first proposition, let us see wheth
er "a reference to the amount of banking
capita], Sec. in Great Britain during the years
1834, 1835, and 1836, will show an augmenta
tion of paper currency there as much dispro
portioned to the wants of trade as in the
United States."
Mr. K. then read the following table,
(prepared from official statements :)
Circulation of the Bank of England, joint stock , and
private banks. ?
Bank of Eng. Joint stock. Private. Total,
Jan. 1833, 18,381,000 1,315,000 8,836,000 28.409,000
1834, 18,377,000 1,258,000 8,733,000 28^68,000
1835, 18,100,000 2,188,000 8,231,000 28^)19,000
1836, 17,427,000 3,095,000 8,357,000 28^75,000
1837, 17,868,000 3,755,000 7,258,000 28^81,000
The foregoing table is made from the
February monthly returns of the Bank of
England, and the December to March quar
terly returns of the joint stock and private
banks, as being the most likely way to a|H
proximate to the aggregate for the month of
January. The original official returns we*e
before him, Mr. Xing said, and were at the
service of any gentleman ; and the monthly
and tri-monthly variation in the entire circu
lation was so trifling that it was scarcely
worth naming. It would be seen, from the
above table, that the entire "augmentation of
paper currency" in England during the years
1834, 1835, and 1836, the period mentioned
by the President, was only <?323,000, or
about one third of one per cent, on the cur
rency, estimating the whole currency of
England at <?200,000,000 ; and the entire
"augmentation" during 1833 to 1836 inclu
sive, (commencing one year earlier,) was only
<?413,000, or not quite one-half of one per
cent, on the paper circulation. Now let us
see whether tins'* incase is "similar to our
own," during the same period.
Mr. King then presented a statement which
he believed to be as accurate as it could be
made by a collection and continuation of the
returns of local banks up to 1st January,
1837. It was more likely to be an under
than an over estimate, from the great diffi
culty of finding new banks, and getting
statements of their issues. The following
is the statement :
On the 1st of January in the following
years the state of the banks was this :
Capital
Number
of banks.
Loans
Bills in
circu
lation
Depo
sitee
liabilities
on bills &
depositee.
Millions of Dollars.
1830 320 145 200 61 55 117
1834 506 200 324 95 76 171
1835 558 231 365 104 83 187
1836 567 252 458 140 115 255
1837 677 324 591 186 155 341
By the above table it will be seen that,
when we add the estimated amount of specie
in 1834 and 1836, respectively, we find an
augmentation of the entire currenoy of near
ly 94 per cent., and an augmentation of
paper circulation of nearly 96 per cent.?
Our own entire currency, then, 'during the
years 1834, 1835, and 1836," has increased
nearly 94 per cent., and our paper circulation,
during the same period, nearly 96 per cent. ;
whilst the entire currency of England has
increased about one third of one per cent.,
and her paper circulation, during that period,
having fluctuated a mere trifle at any time,
and sometimes even contracted, is found at the
end of the period mentioned, to have in
creased only about 1 J per cent. He had not
given himself the trouble to be very minute
in the calculations above, and had used round
numbers ; but no use of authentic materials
could vary the result more than a mere frac
tion, and strict accuracy would most likely
make the comparison more unfavorable to
the statement of an equal expansion in the
two countries during the period referred to.
Instead of equality, then, we had, for
England, an increase in the entire estimated
currency of the nation of about one third of I
one per cent. ;
In the United States, an increase of about
94 per cent. ;
In England, an increase of paper currency
of about l? per cent. ;
Id the United States, an increase of about
96 per cent.
So much (said Mr. King) for an equal ex
pansion of the currency in both countries.
As to the "other credits," they were not tan
gible, but every man of any observation must
know that On this item we should suffer in
the comparison more than in the other.?
Credits were certainly multiplied in England,
in some districts, by the increase of the num
ber of joint stock banks, by which new con
nexions were formed, and the number of]
ehecks, drafts, &c. increased. But the in
crease of joint stock banks (deducting the
private banks melted into them) bears no
comparison to the increase of banks in this
country, as we find frojh official statements.
The conseqnent increase of credits, though
they cannot be ascertained with precision in
either country, may .be compared by, the re
.SlilL Th/L irtrrenee of credit A
has been based on the same national cash capi
tal , as appears by the unchanged quantity of
the currency , as exhibited by the tables. And
that it has not been redundant is unansicera
bly proven by its having produced no general
speculative rise of prices. To speak of a re
dundancy of currency or credit , when no specu
lative rise in cotnmodities has taken place , is
perfect nonsense. Where facts have been
Stated and not proved, I have taken issue,
and disproved them by facts fully established.
Where facts are conjectured, pwill present
ly introduce evidence to piyve the conjec
tures groundless, by proyAg the absence t>f
consequences invariably/connected with them .
The only way in wrfa redundancy of cur
rency or credit depreciates foreign exchange
is by producingy?peculative rise in prices,
and a consequei^overtrading. England has
not overtrad?*f on the contrary, she has ex
ported morgan she imported, and left up
enormou/y in her debt. But whilst she has
a large/oalance against us, exchange was
again / her, and making a continual cjrain
upp/ger bullion ! This strange financial
A commercial anomaly, so embarrassing to
__e English, I will hereafter explain, after
having completed the proof on the first pro
position.
He then read the evidence of Mr. Gurney,
a man of so much intelligence and authority
on these subjects as to be called before the
joint stock bank committee lately appointed
bv Parliament. This witness shows remark
able intelligence on the subjeet of finance,
but is here strangely embarrassed for want
of facts, of which he seems entirely igno
rant. [Here Mr. K. read the evidence of
Mr. Garney as follows :]
Evidence of Mr. Gurney before the Committee
of Joint Stock Banks.
Q. 9529. Has there been any change of
late in the state of the London money mar
ke( There has been a gradual increase in the
t^(^594W*ro what do you attribute that
altered state of the money market in Lon
d?One cause has been the exportation of bul
lion to foreign countries ; but I apprehend
the MAIN CAUSE IS, the circuJanng medmm
existing in Europe and the mercantile parts
of America (!) is not increased m proportion
to the transactions, and that the same quan
tity of circulating medfomr** perhaps even
a reduced quantity has to perform a much
larger amount of transactions.
, Q 2595. Would not the effect ot it,
owing to that to which you have alluded, be
rather indicated in a fall in the money pn
of commodities 1 r
That is the tendency of it >* but the^^
conflicting causes that have marvellously
maintained (not increased) the value of com
modities generally.
Mr. Gurneyis a bill broker, who Procl'r"
the discount or rediscount of country bil
in the London market. He was, therefore,
well acquainted with the facts, and the sub
ject on which he speaks, so far as England is
concerned ; and he tells us "the value of
money had gradually increased. And in
another part of his evidence he tells i us that
the increase is about 20 per cent. He knew
this as a fact, and in England he was enabled,
in some measure, to account for it, 0'
knew that currency had not increased ; wt>?l8^
from the progressive increase of national
wealth, commodities and transactions tad.?
He could, therefore, account for the depre
ciation of exchange, and export of gold to
America, on no other supposition than that
the currency of the -commercial parts of
America" was even more contracted and dis
proportioned to commodities than in ng an .
But why was the appreciation of money
dicated by a fall in the money prices of com
modities?" Though this was the natur
"tendency," conflicting causes marvellously
maintained prices." What were ec?n,
flicting causes referred to by Mr. GurneJ ?
Evidently the "increased activity in the man
ufacturing districts" by the increased demand
for the products of English labor for Ameri
can consumption. The d^eciahcmofcom-^
modities by the appreciation ofmoncywas
counteracted gh
by an increased demaru) for them. Ihoug
ideas 0f Mr. Gurney seem clear, he
seems, for want of facts, to be involved in
embarrassment and apparent con,?^""nn
That the value of money was raised in Eng
land by an insufficiency in quantity, was in
consistent with the exportation of gold, un
less in America, also, the currency was con
tracted. And yet a contraction of the currency
in America was inconsistent with our
demand for English manufactures. Had the
witness, however, known that, so far 'from a
contraction, our currency had ?*?n
100 per cent., and that exchang
our favor whilst there was a large balance
against us ; that we were draining them of
their gold in defiance of this heavy debt and
redundant currency; his embarrassment
would have increased, until he ascertaine
that we were performing all the* e comme -
cial miracles under a new sys?emof finance
by which we exchanged our credit for their
capital, and, after going in debt for ahu^e
commercial balance, borrowed, a
amount and thereby turned the exchanges
against them by borrowing their own money.
Mr K. then further sustained his propo
entered for home consumption, and the
official and deelared valuation
both embracing the period q
eept the official valuation for 1837, which he
taLn0ttT1offi^0^Mr,K.iSaidi,
actually "o gradual increase in the I'J
""S' second proposition (Mr. K. said)
Thiscvidence was the perfect agreement,* on
to? of Mr Holsey PalmeraodMr
Knowles fa. their coDt.OTersy concermDg ^be
action of the joint-stock banks and the c^
duct of the Bank of England Mr. Palmer
in apologizing for *0 contraction of the
bank, and alluding to the causes &c^s
" it is necessary to state these, as they seem in
JXTeeTIL arisen from overtrading or
no aegrtt, n J nance in commercial
any undue speoulatwe advance
prices." Mr. Knowles, howeversnots.ais
fied with this admission, but w.shmg the fact
established beyond doubt, he
tHng, and refute q&Hr . Know..*,
cumncT'hwl been increased by the increase
currency fw* u 0r prices,
of national wealth, says. j f ,
had I lime to prepare one, ^prw beyond
question that so far from
rally inmanv cases there has been a JaU even
3'S ; a factquHe.ncomPatf
able with an over issue and p
the currency. While,
prices has ta^en place, it u \ dis V ^
ble to causes prospectively ajfectin0
as to supply
Doubtless
crease of manufacturing stocky U ? J>
likely also, some loca ov ]ar(>c pro
stock banks was occastoned by .lie lar? ,
fits they derived from the discount of Ameri
can securities and credit* to supply our credit
demand for money; for under our preposter
ous system adopted in 1834, of importing
borrowed money to multiply credits upon, we
have been willing to take all their cash as well
as all their commodities, and give more than
any body else for them, if they would only
let us have them on cwd^? These partial
fluctuations were uncertain and unimportant,
and, so far as they did exist, If M all, are ea
sily accounted for, and principally* if not en
tirely, to be attributed fip t connexion with
us. In no view of the subject could they be
used as evidence of a national redundancy of
currency or credit, or of a national overtrad
ing, neither of which* at we .- have seen, had
taken plaee. /
Mr. K. said that the latter part of the se
cond proposition* and the wholetffthe third,
seemed to be established by infereoce' from
the positions already estaMijjiedif andthe
prooft' already adduced. The only fuller
proof that could be deemed necessary on
these points, was to establish th?J fact that at
the very time we were importing large sums
of specie under under the encouragement of
the wise policy of the Executive, as it was
called, we were enormously indebted, not on
ly on a commercial balance, but also for mo
ney borrowed in the very face of this com
mercial balance against us.
Mr. K. said, at here again became his un
pleasant duty to prove that the President was
mistaken in his estimate of the amount of our
foreign debt. It was important to notice this
mistake with another view. We would not
act in reference to our true situation as debt
ors, if we believed we owed nothing. The
President gives the estimate of our foreign
debt in March last at thirty millions of dol
lars. The President could have had no un
worthy object in this under-estimate; but still
it is a mistake, and one thsft should be noticed
and corrected. If the estimate of the Presi
dent were correct, the debt had evidently been
paid, and overpaid. He had seen an estimate
more than two months ago, which seemed
reasonable, and probable in all its details,
which estimated the liquidation of pur foreign
debt since the suspension of specie payments at
$32,000,000. We had been remitting spe
cie, and exchange, and shipping cotton ever
since; and he had not the slighest idea that
we had paid and liquidated in different ways,
since March last, less than forty-five, and
perhaps fifty millions of dollars: and yet we
find the exchanges heavily against us. He
hoped, then, our banks would not begin to
expand, and our people to overtrade, on the
presumption that Europe was indebted to t a.
Mr. K. said no one could pretend to accu
racy as to the amount of our foreign debt in
March last, but he thought he could satisfy
the Senate that if every species of obligation
were taken into account, it was much nearer
one hundred and thirty than thirty millions of :
dollars.
Mr. K. then proceeded to famish the Sen
ate with such evidence as he had to offer on
this subject. In the first place, he took the
commercial balance alone for the year 1836,
as reported by the Secretary of the Treasu
ry, at upwards of sixty millions. It seemed,
by the report furnished at this session by the
Secretary, that he estimated the commercial
balance which remained as a foreign debt, at
over thirty millions; and perhaps this state
ment misled the President, who took the Sec
retary's commercial balance of one year for the
entire balance at the period referred to. He
thought, however, that the Secretary was
mistaken even as to this commercial balancfc
for 1836. He seemed to have deducted thir
ty millions from the sixty (as Mr. K. suppos
ed,) for our share of the profits of trade.
Mr. L. though not a cent should be deduct
ed. We had it from English accounts, and
had too much reason to believe the fact, that
the principal articles of American exports de
clined from 30 to 40 per cent, between July,
1836, and April, 1837. He believed, then,
we had lost on our exports the full amount
of profit, and perhaps more, and that the gross
amount of balance might safely be estimated
as a foreign debt against us for the year 1836
alone.
Mr. K. then proceeded to show th* amount
of money we had borrowed in Enrope in the
space of one year ending in the fall of 1836.
As Europe owed us nothing on an exchange
of commodities, of course the amount ef spe
cie (beyond that included in the statement
of imports) which we obtained from them,
must have been obtained on credit in some
form or other. ? ? A statement made
by Mr. Fayott, of Paris, a man of great re
search and many opportunities, he believed
as much to be relied on as any other. This
statement was made in the latter part of (if
he mistook not) of 1836, and purported to be
an estimate of the specie shipped from Eu
rope to America during the year preceeding
the statement. This statement Mr. K. read,
as follows: ^ .
Statement from F rederick fayott s essay,
published in Paris in 1836, of the amount
of specie shipped from Europe to America
in one year previous to the date of the es
say.
England, from documentary evi
dence, say <?6,041,666
Holland, two loans, forming to
gether 2, 500, 000. one-half
shipped in specie, i,A>u,uuu
In France, the indemnity 18,000
000 fr. and Hottinguer loan .
14,000,000 together
<?8,624,999
If the above statement is correct, (and it
was certainly more likely to be under than
over the true amount.) we had imported near
forty millions of dollars in one year, besides
the' indemnity, which, if the laws of trade
had been allowed a free operation, would
have been more profitably drawn for than im
ported. Adding the above sum <o the com
mercial balance of 60,000,000, ?pd we bad
evidence of about lOfcQOO.OOO ess. on y the
sDecie included in imports. In addition to
this it was well known, he ssid, that we had
been issuing credits tq a gre?ter er a less ei
tent ever since the commencement of 1834,
and the entire foreign dcbt might safely be
nut down at much more than 100,000,000,
in March last. The debt being established,
it follows that the state of our foreign ex
changes have been false and delusive, and
having been effected by the use of credit,
bare been PB indication ?f ?h? ??? bi\,auce
of trade on a fc'w enchase ?f wnwpdities;
credit having the same efTeetpnthe ewhang
m bi?Mh of a* ?uhi?i bj ; am _u
?old not be nocessary to P?J debt
before exchange* would be equah?^;_a very
large portion of it having assumed the form
offnYestments, on which w?tf?1lMo|ily have
to pay the interest; ami,
tnreof the commerce between thotwocoun
tries will bw it ??nr LI"L*rT 2.
debt agaiqst us, without *|ectu?f tN ?*?
ChJ^K. said that h? hoped be had pfosen
to the satisfaction of^STflenntl, that tho
causes of the present jKWfCSS
mon to Other cotnnuwwd countries, jrhicn,
4q feet, H sufferiwl 0*?ly f9
i^ed*'norW^^r?cnl?,'ITe ri^,np"C"
similar to our own. Thej causes, then, must
be located in our own ?HT.
said he would endeavour to c*pW?wh'
how, and by whatagency they onginated here.
. He then cutback to the WOWl of Ae
deooskes in 1833? a measure that pfi W
frequently spoken of before* a e having been
productive of much
terbalanc'rag good. He had briefly J*
its agency in bringing the comj^f J"**
then present condition at the It .
and every prediction then made ^bfcotP?
true, and each cause W
manner there stated, so fares thoy M^been
since developed. He wo?|d ?nhr npw oy of
it what all admitted? that it proceed 1 1 pan
ic which
home consumption in tbe lMter part pi
and part of 1834, white the P???WF ?V
portTwas not affected By
foreign market. The ????**?
a rise in our fefeign
or fourteen millions of specl. po?M ffl g
ua. This effect was not an&iMted It the
President, as we could see by
of his views when the ^^Leie than
He had no more idea ofbnngi^^WMW
he had of brwgmg LondontoA^^y tne
removal, of the depositee. itfasone
the measure immediate!* boasted of P
of the happy results cf that wise meagre,
from '^rhieh many and "J"*?*** Df*
were to flow in wXfc
the currency was already W" w
dant; and that this Ppecie, thus
our finances ruined. PapaMW**/?" .
expelled. &** specie will flU the
afewofcurren^T EawWoj^W^
and 'cannot, under such ^ g '1..7,n:r
expected
wmSHmw* *
come the basis of farther tapes by ?m?? s,
the whole coptijiuhig to
a speculate me in ^
psxm ssafe
This, of course, produced specU^PPn
home and heavy nmmkf%
wa? iBstribnted in a great ntunborof
g^^rjsaSasa
^ xtr ofth.ro
s sr kks
bloated and diseased eooditws
,0 manifest itself in the snnuper ? Igfr
5%^9?3P
awviniw^H ? -? ? *'"? ft
best financiers of Europe. The natural
juLtfiverise of prices bste,froa?ave4wfc
ir currency and credit; was**
exd2E^J!?d ^SJraJSnt^tSS
or foreign debt. 1 si we praventeoinis
our
bah Ace
W ?T> vs W4 ivivi^h VVsrf. . ? vr ^ .
by tending them boo^tbeok s hares, State stocks,
credits of Tinour descriptions, to a greater umuit
than we owed then, By tbeae tdfeans we raised oo?
? f ? ?
means ui mo nouno they
speculations at home bad produced ah} oat an nnlim
ited demand for money, and we WPqp take all theis
cash, as well as all their camwodlUea, and overbid
their own capitalixtt to get tim, provided we oooU
make the operation <m credit. Thus we continued
invertin*4he laws of trade, and utteHy cQnfoundix^
the bank directors and pgpi talis t* pf England, untjj
the summer of 18JJ6, We find that the bank direc,
tors then made the discovery that the Unj^d Stales
had beer draining them of their gold *^oo credit,*' and
they took steps to prevent jt, by increasing the rate
of interest in Juoe to 41, and in August to five pey
cent.
? Let us now return to the United States. Ifl Jpnf,.
1836, the ruin threatened by ao la/ge an aocumula,
tiop of the public money, and the uses that were
made of it, and the unsound state of the currency
generally, was so manifest, that all parties united it)
the opinion that something must he done with it,
After full dist uuion and frreof deliberation, Cpngres*
with uncommon unanimity, adopted the law to dtk,
tribute the deposites among the States. Though nq
measure could be free from objection, this was cer,
tainly the wisest that could haye. been adopted in
reference to U?P end proposed. It'depleted t)ie trea
sury, and checked over issues, by ? public law, nitf*
full notice, easy terms, and ample piny fpr its ejecu
tion. Tbe President, was, unfortunately, opposed tq
it, and seemed determined, not only to use every
means tp preventits efficienpv. bqt to prevent
operation on the Western gnd South westehi deposite
banks, fihich, in fret, most needed its operation,
With this view, he adopted ihe famous specie lirati
lar? a sort of Order in Council ? though thf identi- '
cal meoiUfp bad been a few days beibrp prwiosH
a legislative rpe?sure, and, with almpst perfect
nimity, rejected by the Senate.
The pnncipal, perhaps the only object of this
sure, was to savp from explosion some pf the t<
ing deposite hanks in the West and Southwest, \
they should bewailed pn to comply with ihe deposito
law, %gd surrender the public money. His ubiect
could not have be<'n to prevent over-issuf <, sucn an
object being inconsistent with his opposition to the
deposits bin, which was ccrtainly, pf all others, ih^
best conceived for {liat purpose Whateyef ffii|lrt