XIV. BANKRUPT ACT FOR BANKS: MR. BENTON'S SPEECH…

XIV. BANKRUPT ACT FOR BANKS: MR. BENTON'S SPEECH

The power of Congress to pass bankrupt laws is expressly given in our constitution, and given without limitation or qualification. It is the fourth in the number of the enumerated powers, and runs thus: "Congress shall have power to establish a uniform rule of naturalization, and uniform laws on the subject of bankruptcies throughout the United States." This is a full and clear grant of power. Upon its face it admits of no question, and leaves Congress at full liberty to pass any kind of bankrupt laws they please, limited only by the condition, that whatever laws are passed, they are to be uniform in their operation throughout the United States. Upon the face of our own constitution there is no question of our right to pass a bankrupt law, limited to banks and bankers; but the senator from Massachusetts [Mr. WEBSTER] and others who have spoken on the same side with him, must carry us to England, and conduct us through the labyrinth of English statute law, and through the chaos of English judicial decisions, to learn what this word bankruptcies, in our constitution, is intended to signify. In this he, and they, are true to the habits of the legal profession--those habits which, both in Great Britain and our America, have become a proverbial disqualification for the proper exercise of legislative duties. I know, Mr. President, that it is the fate of our lawyers and judges to have to run to British law books to find out the meaning of the phrases contained in our constitution; but it is the business of the legislator, and of the statesman, to take a larger view--to consider the difference between the political institutions of the two countries--to ascend to first principles--to know the causes of events--and to judge how far what was suitable and beneficial to one might be prejudicial and inapplicable to the other. We stand here as legislators and statesmen, not as lawyers and judges; we have a grant of power to execute not a statute to interpret; and our first duty is to look to that grant, and see what it is; and our next duty is to look over our country, and see whether there is any thing in it which requires the exercise of that grant of power. This is what our President has done, and what we ought to do. He has looked into the constitution, and seen there an unlimited grant of power to pass uniform laws on the subject of bankruptcies; and he has looked over the United States, and seen what he believes to be fit subjects for the exercise of that power, namely, about a thousand banks in a state of bankruptcy, and no State possessed of authority to act beyond its own limits in remedying the evils of a mischief so vast and so frightful. Seeing these two things--a power to act, and a subject matter requiring action--the President has recommended the action which the constitution permits, and which the subject requires; but the senator from Massachusetts has risen in his place, and called upon us to shift our view; to transfer our contemplation--from the constitution of the United States to the British statute book--from actual bankruptcy among ourselves to historical bankruptcy in England; and to confine our legislation to the characteristics of the English model.

As a general proposition, I lay it down that Congress is not confined, like jurists and judges, to the English statutory definitions, or the Nisi Prius or King's Bench construction of the phrases known to English legislation, and used in our constitution. Such a limitation would not only narrow us down to a mere lawyer's view of a subject, but would limit us, in point of time, to English precedents, as they stood at the adoption of our constitution, in the year 1789. I protest against this absurdity, and contend that we are to use our granted powers according to the circumstances of our own country, and according to the genius of our republican institutions, and according to the progress of events and the expansion of light and knowledge among ourselves. If not, and if we are to be confined to the "usual objects," and the "usual subjects," and the "usual purposes," of British legislation at the time of the adoption of our constitution, how could Congress ever make a law in relation to steamboats, or to railroad cars, both of which were unknown to British legislation in 1789; and therefore, according to the idea that would send us to England to find out the meaning of our constitution, would not fall within the limits of our legislative authority. Upon their face, the words of the constitution are sufficient to justify the President's recommendation, even as understood by those who impugn that recommendation. The bankrupt clause is very peculiar in its phraseology, and the more strikingly so from its contrast with the phraseology of the naturalization clause, which is coupled with it. Mark this difference: there is to be a uniform rule of naturalization: there are to be uniform laws on the subject of bankruptcies. One is in the singular, the other in the plural; one is to be a rule, the other are to be laws; one acts on individuals, the other on the subject; and it is bankruptcies that are, and not bankruptcy that is, to be the objects of these uniform laws.

As a proposition, now limited to this particular case, I lay it down that we are not confined to the modern English acceptation of this term bankrupt; for it is a term, not of English, but of Roman origin. It is a term of the civil law, and borrowed by the English from that code. They borrowed from Italy both the name and the purpose of the law; and also the first objects to which the law was applicable. The English were borrowers of every thing connected with this code; and it is absurd in us to borrow from a borrower--to copy from a copyist--when we have the original lender and the original text before us. Bancus and ruptus signifies a broken bench; and the word broken is not metaphorical but literal, and is descriptive of the ancient method of cashiering an insolvent or fraudulent banker, by turning him out of the exchange or market place, and breaking the table bench to pieces on which he kept his money and transacted his business. The term bankrupt, then, in the civil law from which the English borrowed it, not only applied to bankers, but was confined to them; and it is preposterous in us to limit ourselves to an English definition of a civil law term.

Upon this exposition of our own constitution, and of the civil law derivation of this term bankrupt, I submit that the Congress of the United States is not limited to the English judicial or statutory acceptation of the term; and so I finish the first point which I took in the argument. The next point is more comprehensive, and makes a direct issue with the proposition of the senator from Massachusetts, [Mr. WEBSTER.] His proposition is, that we must confine our bankrupt legislation to the usual objects, the usual subjects, and the usual purposes of bankrupt laws in England; and that currency (meaning paper money and shin-plasters of course), and banks, and banking, are not within the scope of that legislation. I take issue, sir, upon all these points, and am ready to go with the senator to England, and to contest them, one by one, on the evidences of English history, of English statute law, and of English judicial decision. I say English; for, although the senator did not mention England, yet he could mean nothing else, in his reference to the usual objects, usual subjects, and usual purposes of bankrupt laws. He could mean nothing else. He must mean the English examples and the English practice, or nothing; and he is not a person to speak, and mean nothing.

Protesting against this voyage across the high seas, I nevertheless will make it, and will ask the senator on what act, out of the scores which Parliament has passed upon this subject, or on what period, out of the five hundred years that she has been legislating upon it, will he fix for his example? Or, whether he will choose to view the whole together; and out of the vast chaotic and heterogeneous mass, extract a general power which Parliament possesses, and which he proposes for our exemplar? For myself, I am agreed to consider the question under the whole or under either of these aspects, and, relying on the goodness of the cause, expect a safe deliverance from the contest, take it in any way.

And first, as to the acts passed upon this subject; great is their number, and most dissimilar their provisions. For the first two hundred years, these acts applied to none but aliens, and a single class of aliens, and only for a single act, that of flying the realm to avoid their creditors. Then they were made to apply to all debtors, whether natives or foreigners, engaged in trade or not, and took effect for three acts: 1st, flying the realm; 2d, keeping the house to avoid creditors; 3d, taking sanctuary in a church to avoid arrest. For upwards of two hundred years--to be precise, for two hundred and twenty years--bankruptcy was only treated criminally, and directed against those who would not face their creditors, or abide the laws of the land; and the remedies against them were not civil, but criminal; it was not a distribution of the effects, but corporal punishment, to wit: imprisonment and outlawry.[1] The statute of Elizabeth was the first that confined the law to merchants and traders, took in the unfortunate as well as the criminal, extended the acts of bankruptcy to inability as well as to disinclination to pay, discriminated between innocent and fraudulent bankruptcy; and gave to creditors the remedial right to a distribution of effects. This statute opened the door to judicial construction, and the judges went to work to define by decisions, who were traders, and what acts constituted the fact, or showed an intent to delay or to defraud creditors. In making these decisions, the judges reached high enough to get hold of royal companies, and low enough to get hold of shoemakers; the latter upon the ground that they bought the leather out of which they made the shoes; and they even had a most learned consultation to decide whether a man who was a landlord for dogs, and bought dead horses for his four-legged boarders, and then sold the skins and bones of the horse carcases he had bought, was not a trader within the meaning of the act; and so subject to the statute of bankrupts. These decisions of the judges set the Parliament to work again to preclude judicial constructions by the precision, negatively and affirmatively, of legislative enactment. But, worse and worse! Out of the frying-pan into the fire. The more legislation the more construction; the more statutes Parliament made, the more numerous and the more various the judicial decisions; until, besides merchants and traders, near forty other descriptions of persons were included; and the catalogue of bankruptcy acts, innocent or fraudulent, is swelled to a length which requires whole pages to contain it. Among those who are now included by statutory enactment in England, leaving out the great classes comprehended under the names of merchants and traders, are bankers, brokers, factors, and scriveners; insurers against perils by sea and land; warehousemen, wharfingers, packers, builders, carpenters, shipwrights and victuallers; keepers of inns, hotels, taverns and coffee-houses; dyers, printers, bleachers, fullers, calendrers, sellers of cattle or sheep; commission merchants and consignees; and the agents of all these classes. These are the affirmative definitions of the classes liable to bankruptcy in England; then come the negative; and among these are farmers, graziers, and common laborers for hire; the receivers general of the king's taxes, and members or subscribers to any incorporated companies established by charter of act of Parliament. And among these negative and affirmative exclusions and inclusions, there are many classes which have repeatedly changed position, and found themselves successively in and out of the bankrupt code. Now, in all this mass of variant and contradictory legislation, what part of it will the senator from Massachusetts select for his model? The improved, and approved parts, to be sure! But here a barrier presents itself--an impassable wall interposes--a veto power intervenes. For it so happens that the improvements in the British bankrupt code, those parts of it which are considered best, and most worthy of our imitation, are of modern origin--the creations of the last fifty years--actually made since the date of our constitution; and, therefore, not within the pale of its purview and meaning. Yes, sir, made since the establishment of our constitution, and, therefore, not to be included within its contemplation; unless this doctrine of searching into British statutes for the meaning of our constitution, is to make us search forwards to the end of the British empire, as well as search backwards to its beginning. Fact is, that the actual bankrupt code of Great Britain--the one that preserves all that is valuable, that consolidates all that is preserved, and improves all that is improvable, is an act of most recent date--of the reign of George IV.; and not yet a dozen years old. Here, then, in going back to England for a model, we are cut off from her improvements in the bankrupt code, and confined to take it as it stood under the reign of the Plantagenets, the Tudors, the Stuarts, and the earlier reigns of the Brunswick sovereigns. This should be a consideration, and sufficiently weighty to turn the scale in favor of looking to our own constitution alone for the extent and circumscription of our powers.

[1] Preamble to the act of 34th of HENRY VIII.

Whereas divers and sundry persons craftily obtained into their hands great substance of other men's goods, do suddenly flee to parts unknown, or keep their houses, not minding to pay or restore to any of their creditors, their debts and duties, but at their own wills and own pleasures consume the substance obtained by credit of other men for their own pleasures and delicate living, against all reason, equity, and good conscience.

But let us continue this discussion upon principles of British example and British legislation. We must go to England for one of two things; either for a case in point, to be found in some statute, or a general authority, to be extracted from a general practice. Take it either way, or both ways, and I am ready and able to vindicate, upon British precedents, our perfect right to enact a bankrupt law, limited in its application to banks and bankers. And first, for a case in point, that is to say, an English statute of bankruptcy, limited to these lords of the purse-strings: we have it at once, in the first act ever passed on the subject--the act of the 30th year of the reign of Edward III., against the Lombard Jews. Every body knows that these Jews were bankers, usually formed into companies, who, issuing from Venice, Milan, and other parts of Italy, spread over the south and west of Europe, during the middle ages; and established themselves in every country and city in which the dawn of reviving civilization, and the germ of returning industry, gave employment to money, and laid the foundation of credit. They came to London as early as the thirteenth century, and gave their name to a street which still retains it, as well as it still retains the particular occupation, and the peculiar reputation, which the Lombard Jews established for it. The first law against bankrupts ever passed in England, was against the banking company composed of these Jews, and confined exclusively to them. It remained in force two hundred years, without any alteration whatever, and was nothing but the application of the law of their own country to these bankers in the country of their sojournment--the Italian law, founded upon the civil law, and called in Italy banco rotto, broken bank. It is in direct reference to these Jews, and this application of the exotic bankrupt law to them, that Sir Edward Coke, in his institutes, takes occasion to say that both the name and the wickedness of bankruptcy were of foreign origin, and had been brought into England from foreign parts. It was enacted under the reign of one of the most glorious of the English princes--a reign as much distinguished for the beneficence of its civil administration as for the splendor of its military achievements. This act of itself is a full answer to the whole objection taken by the senator from Massachusetts. It shows that, even in England, a bankrupt law has been confined to a single class of persons, and that class a banking company. And here I would be willing to close my speech upon a compromise--a compromise founded in reason and reciprocity, and invested with the equitable mantle of a mutual concession. It is this: if we must follow English precedents, let us follow them chronologically and orderly. Let us begin at the beginning, and take them as they rise. Give me a bankrupt law for two hundred years against banks and bankers; and, after that, make another for merchants and traders.

The senator from Massachusetts [Mr. WEBSTER] has emphatically demanded, how the bankrupt power could be fairly exercised by seizing on corporations and bankers, and excluding all the other usual subjects of bankrupt laws? I answer, by following the example of that England to which he has conducted us; by copying the act of the 30th of Edward III., by going back to that reign of heroism, patriotism, and wisdom; that reign in which the monarch acquired as much glory from his domestic policy as from his foreign conquests; that reign in which the acquisition of dyers and weavers from Flanders, the observance of law and justice, and the encouragement given to agriculture and manufactures, conferred more benefit upon the kingdom, and more glory upon the king, than the splendid victories of Poictiers, Agincourt, and Cressy.

But the senator may not be willing to yield to this example, this case in point, drawn from his own fountain, and precisely up to the exigency of the occasion. He may want something more; and he shall have it. I will now take the question upon its broadest bottom and fullest merits. I will go to the question of general power--the point of general authority--exemplified by the general practice of the British Parliament, for five hundred years, over the whole subject of bankruptcy. I will try the question upon this basis; and here I lay down the proposition, that this five hundred years of parliamentary legislation on bankruptcy establishes the point of full authority in the British Parliament to act as it pleased on the entire subject of bankruptcies. This is my proposition; and, when it is proved, I shall claim from those who carry me to England for authority, the same amount of power over the subject which the British Parliament has been in the habit of exercising. Now, what is the extent of that power? Happily for me, I, who have to speak, without any inclination for the task; still more happily for those who have to hear me, peradventure without profit or pleasure; happily for both parties, my proposition is already proved, partly by what I have previously advanced, and fully by what every senator knows. I have already shown the practice of Parliament upon this subject, that it has altered and changed, contracted and enlarged, put in and left out, abolished and created, precisely as it pleased. I have already shown, in my rapid view of English legislation on this subject, that the Parliament exercised plenary power and unlimited authority over every branch of the bankrupt question; that it confined the action of the bankrupt laws to a single class of persons, or extended it to many classes; that it was sometimes confined to foreigners, then applied to natives, and that now it comprehends natives, aliens, denizens, and women; that at one time all debtors were subject to it; then none but merchants and traders; and now, besides merchants and traders, a long list of persons who have nothing to do with trade; that at one time bankruptcy was treated criminally, and its object punished corporeally, while now it is a remedial measure for the benefit of the creditors, and the relief of unfortunate debtors; and that the acts of the debtor which may constitute him a bankrupt, have been enlarged from three or four glaring misdeeds, to so long a catalogue of actions, divided into the heads of innocent and fraudulent; constructive and positive; intentional and unintentional; voluntary and forced; that none but an attorney, with book in hand, can pretend to enumerate them. All this has been shown; and, from all this, it is incontestable that Parliament can do just what it pleases on the subject; and, therefore, our Congress, if referred to England for its powers, can do just what it pleases also. And thus, whether we go by the words of our own constitution, or by a particular example in England, or deduce a general authority from the general practice of that country, the result is still the same: we have authority to limit, if we please, our bankrupt law to the single class of banks and bankers.

The senator from Massachusetts [MR. WEBSTER] demands whether bankrupt laws ordinarily extend to corporations, meaning moneyed corporations. I am free to answer that, in point of fact, they do not. But why? because they ought not? or because these corporations have yet been powerful enough, or fortunate enough, to keep their necks out of that noose? Certainly the latter. It is the power of these moneyed corporations in England, and their good fortune in our America, which, enabling them to grasp all advantages on one hand, and to repulse all penalties on the other, has enabled them to obtain express statutory exemption from bankrupt liabilities in England; and to escape, thus far, from similar liabilities in the United States. This, sir, is history, and not invective; it is fact, and not assertion; and I will speedily refresh the senator's memory, and bring him to recollect why it is, in point of fact, that bankrupt laws do not usually extend to these corporations. And, first, let us look to England, that great exemplar, whose evil examples we are so prompt, whose good ones we are so slow, to imitate. How stands this question of corporation unliability there? By the judicial construction of the statute of Elizabeth, the partners in all incorporated companies were held subject to the bankrupt law; and, under this construction, a commission of bankrupt was issued against Sir John Wolstenholme, a gentleman of large fortune, who had advanced a sum of money on an adventure in the East India Company's trade. The issue of this commission was affirmed by the Court of King's Bench; but this happened to take place in the reign of Charles II.--that reign during which so little is found worthy of imitation in the government of Great Britain--and immediately two acts of Parliament were passed, one to annul the judgment of the Court of King's Bench in the case of Sir John Wolstenholme, and the other to prevent any such judgments from being given in future. Here are copies of the two acts:

FIRST ACT, TO ANNUL THE JUDGMENT.

"Whereas a verdict and judgment was had in the Easter term of the King's Bench, whereby Sir John Wolstenholme, knight, and adventurer in the East India Company, was found liable to a commission of bankrupt only for, and by reason of, a share which he had in the joint stock of said company: Now, &c., Be it enacted, That the said judgment be reversed, annulled, vacated, and for naught held," &c.

SECOND ACT, TO PREVENT SUCH JUDGMENTS IN FUTURE.

"That whereas divers noblemen and gentlemen, and persons of quality, no ways bred up to trade, do often put in great stocks of money into the East India and Guinea Company: Be it enacted, That no persons adventurers for putting in money or merchandise into the said companies, or for venturing or managing the fishing trade, called the royal fishing trade, shall be reputed or taken to be a merchant or trader within any statutes for bankrupts."

Thus, and for these reasons, were chartered companies and their members exempted from the bankrupt penalties, under the dissolute reign of Charles II. It was not the power of the corporations at that time--for the Bank of England was not then chartered, and the East India Company had not then conquered India--which occasioned this exemption; but it was to favor the dignified characters who engaged in the trade--noblemen, gentlemen, and persons of quality. But, afterwards, when the Bank of England had become almost the government of England, and when the East India Company had acquired the dominions of the Great Mogul, an act of Parliament expressly declared that no member of any incorporated company, chartered by act of Parliament, should be liable to become bankrupt. This act was passed in the reign of George IV., when the Wellington ministry was in power, and when liberal principles and human rights were at the last gasp. So much for these corporation exemptions in England; and if the senator from Massachusetts finds any thing in such instances worthy of imitation, let him stand forth and proclaim it.

But, sir, I am not yet done with my answer to this question; do such laws ordinarily extend to corporations at all? I answer, most decidedly, that they do! that they apply in England to all the corporations, except those specially excepted by the act of George IV.; and these are few in number, though great in power--powerful, but few--nothing but units to myriads, compared to those which are not excepted. The words of that act are: "Members of, or subscribers to, any incorporated commercial or trading companies, established by charter act of Parliament." These words cut off at once the many ten thousand corporations in the British empire existing by prescription, or incorporated by letters patent from the king; and then they cut off all those even chartered by act of Parliament which are not commercial or trading in their nature. This saves but a few out of the hundreds of thousands of corporations which abound in England, Scotland, Wales, and Ireland. It saves, or rather confirms, the exemption of the Bank of England, which is a trader in money; and it confirms, also, the exemption of the East India Company which is, in contemplation of law at least, a commercial company; and it saves or exempts a few others deriving charters of incorporation from Parliament; but it leaves subject to the law the whole wilderness of corporations, of which there are thousands in London alone, which derive from prescription or letters patent; and it also leaves subject to the same laws all the corporations created by charter act of Parliament, which are not commercial or trading. The words of the act are very peculiar--"charter act of Parliament;" so that corporations by a general law, without a special charter act, are not included in the exemption. This answer, added to what has been previously said, must be a sufficient reply to the senator's question, whether bankrupt laws ordinarily extend to corporations? Sir, out of the myriad of corporations in Great Britain, the bankrupt law extends to the whole, except some half dozen or dozen.

So much for the exemption of these corporations in England; now for our America. We never had but one bankrupt law in the United States, and that for the short period of three or four years. It was passed under the administration of the elder Mr. Adams, and repealed under Mr. Jefferson. It copied the English acts including among the subjects of bankruptcy, bankers, brokers, and factors. Corporations were not included; and it is probable that no question was raised about them, as, up to that time, their number was few, and their conduct generally good. But, at a later date, the enactment of a bankrupt law was again attempted in our Congress; and, at that period, the multiplication and the misconduct of banks presented them to the minds of many as proper subjects for the application of the law; I speak of the bill of 1827, brought into the Senate, and lost. That bill, like all previous laws since the time of George II., was made applicable to bankers, brokers, and factors. A senator from North Carolina [Mr. BRANCH] moved to include banking corporations. The motion was lost, there being but twelve votes for it; but in this twelve there were some whose names must carry weight to any cause to which they are attached. The twelve were, Messrs. Barton, Benton, Branch, Cobb, Dickerson, Hendricks, Macon, Noble, Randolph, Reed, Smith of South Carolina, and White. The whole of the friends of the bill, twenty-one in number, voted against the proposition, (the present Chief Magistrate in the number,) and for the obvious reason, with some, of not encumbering the measure they were so anxious to carry, by putting into it a new and untried provision. And thus stands our own legislation on this subject. In point of fact, then, chartered corporations have thus far escaped bankrupt penalties, both in England, and in our America; but ought they to continue to escape? This is the question--this the true and important inquiry, which is now to occupy the public mind.

The senator from Massachusetts [Mr. WEBSTER] says the object of bankrupt laws has no relation to currency; that their object is simply to distribute the effects of insolvent debtors among their creditors. So says the senator, but what says history? What says the practice of Great Britain? I will show you what it says, and for that purpose will read a passage from McCulloch's notes on Smith's Wealth of Nations. He says:

"In 1814-'15, and '16, no fewer than 240 country banks stopped payment, and ninety-two commissions of bankruptcy were issued against these establishments, being at the rate of one commission against every seven and a half of the total number of country banks existing in 1813."

Two hundred and forty stopped payment at one dash, and ninety-two subjected to commissions of bankruptcy. They were not indeed chartered banks, for there are none such in England, except the Bank of England; but they were legalized establishments, existing under the first joint-stock bank act of 1708; and they were banks of issue. Yet they were subjected to the bankrupt laws, ninety-two of them in a single season of bank catalepsy; their broken "promises to pay" were taken out of circulation; their doors closed; their directors and officers turned out; their whole effects, real and personal, their money, debts, books, paper, and every thing, put into the hands of assignees; and to these assignees, the holders of their notes forwarded their demands, and were paid, every one in equal proportion--as the debts of the bank were collected, and its effects converted into money; and this without expense or trouble to any one of them. Ninety-two banks in England shared this fate in a single season of bank mortality; five hundred more could be enumerated in other seasons, many of them superior in real capital, credit, and circulation, to our famous chartered banks, most of which are banks of moonshine, built upon each other's paper; and the whole ready to fly sky-high the moment any one of the concern becomes sufficiently inflated to burst. The immediate effect of this application of the bankrupt laws to banks in England, is two-fold: first, to save the general currency from depreciation, by stopping the issue and circulation of irredeemable notes; secondly, to do equal justice to all creditors, high and low, rich and poor, present and absent, the widow and the orphan, as well as the cunning and the powerful, by distributing their effects in proportionate amounts to all who hold demands. This is the operation of bankrupt laws upon banks in England, and all over the British empire; and it happens to be the precise check upon the issue of broken bank paper, and the precise remedy for the injured holders of their dishonored paper which the President recommends. Here is his recommendation, listen to it:

"In the mean time, it is our duty to provide all the remedies against a depreciated paper currency which the constitution enables us to afford. The Treasury Department, on several former occasions, has suggested the propriety and importance of a uniform law concerning bankruptcies of corporations and other bankers. Through the instrumentality of such a law, a salutary check may doubtless be imposed on the issues of paper money, and an effectual remedy given to the citizen, in a way at once equal in all parts of the Union, and fully authorized by the constitution."

The senator from Massachusetts says he would not, intentionally, do injustice to the message or its author; and doubtless he is not conscious of violating that benevolent determination; but here is injustice, both to the message and to its author; injustice in not quoting the message as it is, and showing that it proposes a remedy to the citizen, as well as a check upon insolvent issues; injustice to the author in denying that the object of bankrupt laws has any relation to currency, when history shows that these laws are the actual instrument for regulating and purifying the whole local paper currency of the entire British empire, and saving that country from the frauds, losses, impositions, and demoralization of an irredeemable paper money.

The senator from Massachusetts says the object of bankrupt laws has no relation to currency. If he means hard-money currency, I agree with him; but if he means bank notes, as I am sure he does, then I point him to the British bankrupt code, which applies to every bank of issue in the British empire, except the Bank of England itself, and the few others, four or five in number, which are incorporated by charter acts. All the joint-stock banks, all the private banks, all the bankers of England, Scotland, Wales, and Ireland, are subject to the law of bankruptcy. Many of these establishments are of great capital and credit; some having hundreds, or even thousands of partners; and many of them having ten, or twenty, or thirty, and some even forty branches. They are almost the exclusive furnishers of the local and common bank note currency; the Bank of England notes being chiefly used in the great cities for large mercantile and Government payments. These joint-stock banks, private companies, and individual bankers are, practically, in the British empire what the local banks are in the United States. They perform the same functions, and differ in name only; not in substance nor in conduct. They have no charters, but they have a legalized existence; they are not corporations, but they are allowed by law to act in a body; they furnish the actual paper currency of the great body of the people of the British empire, as much so as our local banks furnish the mass of paper currency to the people of the United States. They have had twenty-four millions sterling (one hundred and twenty millions of dollars) in circulation at one time; a sum nearly equal to the greatest issue ever known in the United States; and more than equal to the whole bank-note circulation of the present day. They are all subject to the law of bankruptcy, and their twenty-four millions sterling of currency along with them; and five hundred of them have been shut up and wound up under commissions of bankruptcy in the last forty years; and yet the senator from Massachusetts informs us that the object of bankrupt laws has no relation to currency!

But it is not necessary to go all the way to England to find bankrupt laws having relation to currency. The act passed in our own country, about forty years ago, applied to bankers; the bill brought into the House of Representatives, about fifteen years ago, by a gentleman then, and now, a representative from the city of Philadelphia, [Mr. SERGEANT,] also applied to bankers; and the bill brought into this Senate, ten years ago, by a senator from South Carolina, not now a member of this body, [General HAYNE,] still applied to bankers. These bankers, of whom there were many in the United States, and of whom Girard, in the East, and Yeatman and Woods, in the West, were the most considerable--these bankers all issued paper money; they all issued currency. The act, then, of 1798, if it had continued in force, or the two bills just referred to, if they had become law, would have operated upon these bankers and their banks--would have stopped their issues, and put their establishments into the hands of assignees, and distributed their effects among their creditors. This, certainly, would have been having some relation to currency: so that, even with our limited essays towards a bankrupt system, we have scaled the outworks of the banking empire; we have laid hold of bankers, but not of banks; we have reached the bank of Girard, but not the Girard Bank; we have applied our law to the bank of Yeatman and Woods, but not to the rabble of petty corporations which have not the tithe of their capital and credit. We have gone as far as bankers, but not as far as banks; and now give me a reason for the difference. Give me a reason why the act of 1798, the bill of Mr. SERGEANT, in 1821, and the bill of General HAYNE, in 1827, should not include banks as well as bankers. They both perform the same function--that of issuing paper currency. They both involve the same mischief when they stop payment--that of afflicting the country with a circulation of irredeemable and depreciated paper money. They are both culpable in the same mode, and in the same degree; for they are both violators of their "promises to pay." They both exact a general credit from the community, and they both abuse that credit. They both have creditors, and they both have effects; and these creditors have as much right to a pro rata distribution of the effects in one case as in the other. Why, then, a distinction in favor of the bank? Is it because corporate bodies are superior to natural bodies? because artificial beings are superior to natural beings? or, rather, is it not because corporations are assemblages of men; and assemblages are more powerful than single men; and, therefore, these corporations, in addition to all their vast privileges, are also to have the privilege of being bankrupt, and afflicting the country with the evils of bankruptcy, without themselves being subjected to the laws of bankruptcy? Be this as it may--be the cause what it will--the decree has gone forth for the decision of the question--for the trial of the issue--for the verdict and judgment upon the claim of the banks. They have many privileges and exemptions now, and they have the benefit of all laws against the community. They pay no taxes; the property of the stockholders is not liable for their debts; they sue their debtors, sell their property, and put their bodies in jail. They have the privilege of stamping paper money; the privilege of taking interest upon double, treble, and quadruple their actual money. They put up and put down the price of property, labor, and produce, as they please. They have the monopoly of making the actual currency. They are strong enough to suppress the constitutional money, and to force their own paper upon the community, and then to redeem it or not, as they please. And is it to be tolerated, that, in addition to all these privileges, and all these powers, they are to be exempted from the law of bankruptcy? the only law of which they are afraid, and the only one which can protect the country against their insolvent issues, and give a fair chance for payment to the numerous holders of their violated "promises to pay!"

I have discussed, Mr. President, the right of Congress to apply a bankrupt law to banking corporations; I have discussed it on the words of our own constitution, on the practice of England, and on the general authority of Parliament; and on each and every ground, as I fully believe, vindicated our right to pass the law. The right is clear; the expediency is manifest and glaring. Of all the objects upon the earth, banks of circulation are the fittest subjects of bankrupt laws. They act in secret, and they exact a general credit. Nobody knows their means, yet every body must trust them. They send their "promises to pay" far and near. They push them into every body's hands; they make them small to go into small hands--into the hands of the laborer, the widow, the helpless, the ignorant. Suddenly the bank stops payment; all these helpless holders of their notes are without pay, and without remedy. A few on the spot get a little; those at a distance get nothing. For each to sue, is a vexatious and a losing business. The only adequate remedy--the only one that promises any justice to the body of the community, and the helpless holders of small notes--is the bankrupt remedy of assignees to distribute the effects. This makes the real effects available. When a bank stops, it has little or no specie; but it has, or ought to have, a good mass of solvent debts. At present, all these debts are unavailable to the community--they go to a few large and favored creditors; and those who are most in need get nothing. But a stronger view remains to be taken of these debts: the mass of them are due from the owners and managers of the banks--from the presidents, directors, cashiers, stockholders, attorneys; and these people do not make themselves pay. They do not sue themselves, nor protest themselves. They sue and protest others, and sell out their property, and put their bodies in jail; but, as for themselves, who are the main debtors, it is another affair! They take their time, and usually wait till the notes are heavily depreciated, and then square off with a few cents in the dollar! A commission of bankruptcy is the remedy for this evil; assignees of the effects of the bank are the persons to make these owners, and managers, and chief debtors to the institutions, pay up. Under the bankrupt law, every holder of a note, no matter how small in amount, nor how distant the holder may reside, on forwarding the note to the assignees, will receive his ratable proportion of the bank's effects, without expense, and without trouble to himself. It is a most potent, a most proper, and most constitutional remedy against delinquent banks. It is an equitable and a brave remedy. It does honor to the President who recommended it, and is worthy of the successor of Jackson.

Senators upon this floor have ventured the expression of an opinion that there can be no resumption of specie payments in this country until a national bank shall be established, meaning, all the while, until the present miscalled Bank of the United States shall be rechartered. Such an opinion is humiliating to this government, and a reproach upon the memory of its founders. It is tantamount to a declaration that the government, framed by the heroes and sages of the Revolution, is incapable of self-preservation; that it is a miserable image of imbecility, and must take refuge in the embraces of a moneyed corporation, to enable it to survive its infirmities. The humiliation of such a thought should expel it from the imagination of every patriotic mind. Nothing but a dire necessity--a last, a sole, an only alternative--should bring this government to the thought of leaning upon any extraneous aid. But here is no necessity, no reason, no pretext, no excuse, no apology, for resorting to collateral aid; and, above all, to the aid of a master in the shape of a national bank. The granted powers of the government are adequate to the coercion of all the banks. As banks, the federal government has no direct authority over them; but as bankrupts, it has them in its own hands. It can pass bankrupt laws for these delinquent institutions. It can pass such laws either with or without including merchants and traders; and the day for such law to take effect, will be the day for the resumption of specie payments by every solvent bank, and the day for the extinction of the abused privileges of every insolvent one. So far from requiring the impotent aid of the miscalled Bank of the United States to effect a resumption, that institution will be unable to prevent a resumption. Its veto power over other banks will cease; and it will itself be compelled to resume specie payment, or die!

Besides these great objects to be attained by the application of a bankrupt law to banking corporations, there are other great purposes to be accomplished, and some most sacred duties to be fulfilled, by the same means. Our constitution contains three most vital prohibitions, of which the federal government is the guardian and the guarantee, and which are now publicly trodden under foot. No State shall emit bills of credit; no State shall make any thing but gold and silver coin a tender in payment of debts; no State shall pass any law impairing the obligation of contracts. No State shall do these things. So says the constitution under which we live, and which it is the duty of every citizen to protect, preserve, and defend. But a new power has sprung up among us, and has annulled the whole of these prohibitions. That new power is the oligarchy of banks. It has filled the whole land with bills of credit; for it is admitted on all hands that bank notes, not convertible into specie, are bills of credit. It has suppressed the constitutional currency, and made depreciated paper money a forced tender in payment of every debt. It has violated all its own contracts, and compelled all individuals, and the federal government and State governments, to violate theirs; and has obtained from sovereign States an express sanction, or a silent acquiescence, in this double violation of sacred obligations, and in this triple annulment of constitutional prohibitions. It is our duty to bring, or to try to bring, this new power under subordination to the laws and the government. It is our duty to go to the succor of the constitution--to rescue, if possible, these prohibitions from daily, and public and permanent infraction. The application of the bankrupt law to this new power, is the way to effect this rescue--the way to cause these vital prohibitions to be respected and observed, and to do it in a way to prevent collisions between the States and the federal government. The prohibitions are upon the States; it is they who are not to do these things, and, of course, are not to authorize others to do what they cannot do themselves. The banks are their delegates in this three-fold violation of the constitution; and, in proceeding against these delegates, we avoid collision with the States.

Mr. President, every form of government has something in it to excite the pride, and to rouse the devotion, of its citizens. In monarchies, it is the authority of the king; in republics, it is the sanctity of the laws. The loyal subject makes it the point of honor to obey the king; the patriot republican makes it his glory to obey the laws. We are a republic. We have had illustrious citizens, conquering generals, and victorious armies; but no citizen, no general, no army, has undertaken to dethrone the laws and to reign in their stead. This parricidal work has been reserved for an oligarchy of banks! Three times, in thrice seven years, this oligarchy has dethroned the law, and reigned in its place. Since May last, it has held the sovereign sway, and has not yet vouchsafed to indicate the day of its voluntary abdication. The Roman military dictators usually fixed a term to their dictatorships. I speak of the usurpers, not of the constitutional dictators for ten days. These usurpers usually indicated a time at which usurpation should cease, and law and order again prevail. Not so with this new power which now lords it over our America. They fix no day; they limit no time; they indicate no period for their voluntary descent from power, and for their voluntary return to submission to the laws. They could agree in the twinkling of an eye--at the drop of a hat--at the crook of a finger--to usurp the sovereign power; they cannot agree, in four months, to relinquish it. They profess to be willing, but cannot agree upon the time. Let us perform that service for them. Let us name a day. Let us fix it in a bankrupt law. Let us pass that law, and fix a day for it to take effect; and that day will be the day for the resumption of specie payments, or for the trial of the question of permanent supremacy between the oligarchy of banks, and the constitutional government of the people.

We are called upon to have mercy upon the banks; the prayer should rather be to them, to have mercy upon the government and the people. Since May last the ex-deposit banks alone have forced twenty-five millions of depreciated paper through the federal government upon its debtors and the States, at a loss of at least two and a half millions to the receivers, and a gain of an equal amount to the payers. The thousand banks have the country and the government under their feet at this moment, owing to the community upwards of an hundred millions of dollars, of which they will pay nothing, not even ninepences, picayunes, and coppers. Metaphorically, if not literally, they give their creditors more kicks than coppers. It is for them to have mercy on us. But what is the conduct of government towards these banks? Even at this session, with all their past conduct unatoned for, we have passed a relief bill for their benefit--a bill to defer the collection of the large balance which they still owe the government. But there is mercy due in another quarter--upon the people, suffering from the use of irredeemable and depreciated paper--upon the government, reduced to bankruptcy--upon the character of the country, suffering in the eyes of Europe--upon the character of republican government, brought into question by the successful usurpation of these institutions. This last point is the sorest. Gentlemen speak of the failure of experiments--the failure of the specie experiment, as it is called by those who believe that paper is the ancient and universal money of the world; and that the use of a little specie for the first time is not to be attempted. They dwell upon the supposed failure of "the experiment;" while all the monarchists of Europe are rejoicing in the failure of the experiment of republican government, at seeing this government, the last hope of the liberal world, struck and paralyzed by an oligarchy of banks--seized by the throat, throttled and held as a tiger would hold a babe--stripped of its revenues, bankrupted, and subjected to the degradation of becoming their engine to force their depreciated paper upon helpless creditors. Here is the place for mercy--upon the people--upon the government--upon the character of the country--upon the character of republican government.

The apostle of republicanism, Mr. Jefferson, has left it as a political legacy to the people of the United States, never to suffer their government to fall under the control of any unauthorized, irresponsible, or self-created institutions of bodies whatsoever. His allusion was to the Bank of the United States, and its notorious machinations to govern the elections, and get command of the government; but his admonition applies with equal force to all other similar or affiliated institutions; and, since May last, it applies to the whole league of banks which then "shut up the Treasury," and reduced the government to helpless dependence.

It is said that bankruptcy is a severe remedy to apply to banks. It may be answered that it is not more severe here than in England, where it applies to all banks of issue, except the Bank of England, and a few others; and it is not more severe to them than it is to merchants and traders, and to bankers and brokers, and all unincorporated banks. Personally, I was disposed to make large allowances for the conduct of the banks. Our own improvidence tempted them into an expansion of near forty millions, in 1835 and 1836, by giving them the national domain to bank upon; a temptation which they had not the fortitude to resist, and which expanded them to near the bursting point. Then they were driven almost to a choice of bankruptcy between themselves and their debtors, by the act which required near forty millions to be distributed in masses, and at brief intervals, among the States. Some failures were inevitable under these circumstances, and I was disposed to make liberal allowances for them; but there are three things for which the banks have no excuse, and which should forever weigh against their claims to favor and confidence. These things are, first, the political aspect which the general suspension of payment was permitted to assume, and which it still wears; secondly, the issue and use of shinplasters, and refusal to pay silver change, when there are eighty millions of specie in the country; thirdly, the refusal, by the deposit banks to pay out the sums which had been severed from the Treasury, and stood in the names of disbursing officers, and was actually due to those who were performing work and labor, and rendering daily services to the government. For these three things there is no excuse; and, while memory retains their recollection, there can be no confidence in those who have done them.

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XV. DIVORCE OF BANK AND STATE: MR. BENTON'S SPEECH

The bill is to divorce the government from the banks, or rather is to declare the divorce, for the separation has already taken place by the operation of law and by the delinquency of the banks. The bill is to declare the divorce; the amendment is to exclude their notes from revenue payments, not all at once, but gradually, and to be accomplished by the 1st day of January, 1841. Until then the notes of specie-paying banks may be received, diminishing one-fourth annually; and after that day, all payments to and from the federal government are to be made in hard money. Until that day, payments from the United States will be governed by existing laws. The amendment does not affect the Post Office department until January, 1841; until then, the fiscal operations of that Department remain under the present laws; after that day they fall under the principle of the bill, and all payments to and from that department will be made in hard money. The effect of the whole amendment will be to restore the currency of the constitution to the federal government--to re-establish the great acts of 1789 and of 1800--declaring that the revenues should be collected in gold and silver coin only; those early statutes which were enacted by the hard money men who made the constitution, who had seen and felt the evils of that paper money, and intended to guard against these evils in future by creating, not a paper, but a hard-money government.

I am for this restoration. I am for restoring to the federal treasury the currency of the constitution. I am for carrying back this government to the solidity projected by its founders. This is a great object in itself--a reform of the first magnitude--a reformation with healing on its wings, bringing safety to the government and blessings to the people. The currency is a thing which reaches every individual, and every institution. From the government to the washer-woman, all are reached by it, and all concerned in it; and, what seems parodoxical, all are concerned to the same degree; for all are concerned to the whole extent of their property and dealings; and all is all, whether it be much or little. The government with its many ten millions of revenue, suffers no more in proportion than the humble and meritorious laborer who works from sun to sun for the shillings which give food and raiment to his family. The federal government has deteriorated the currency, and carried mischief to the whole community, and lost its own revenues, and subjected itself to be trampled upon by corporations, by departing from the constitution, and converting this government from a hard-money to a paper money government. The object of the amendment and the bill is to reform these abuses, and it is a reform worthy to be called a reformation--worthy to engage the labor of patriots--worthy to unite the exertions of different parties--worthy to fix the attention of the age--worthy to excite the hopes of the people, and to invoke upon its success the blessings of heaven.

Great are the evils,--political, pecuniary, and moral,--which have flowed from this departure from our constitution. Through the federal government alone--through it, not by it--two millions and a half of money have been lost in the last four months. Thirty-two millions of public money was the amount in the deposit banks when they stopped payment; of this sum twenty-five millions have been paid over to government creditors, or transferred to the States. But how paid, and how transferred? In what? In real money, or its equivalent? Not at all! But in the notes of suspended banks--in notes depreciated, on an average, ten per cent. Here then were two and a half millions lost. Who bore the loss? The public creditors and the States. Who gained it? for where there is a loss to one, there must be a gain to another. Who gained the two and a half millions, thus sunk upon the hands of the creditors and the States? The banks were the gainers; they gained it; the public creditors and the States lost it; and to the creditors it was a forced loss. It is in vain to say that they consented to take it. They had no alternative. It was that or nothing. The banks forced it upon the government; the government forced it upon the creditor. Consent was out of the question. Power ruled, and that power was in the banks; and they gained the two and a half millions which the States and the public creditors lost.

I do not pretend to estimate the moneyed losses, direct and indirect, to the government alone, from the use of local bank notes in the last twenty-five years, including the war, and covering three general suspensions. Leaving the people out of view, as a field of losses beyond calculation, I confine myself to the federal government, and say, its losses have been enormous, prodigious, and incalculable. We have had three general stoppages of the local banks in the short space of twenty-two years. It is at the average rate of one in seven years; and who is to guaranty us from another, and from the consequent losses, if we continue to receive their bills in payment of public dues? Another stoppage must come, and that, reasoning from all analogies, in less than seven years after the resumption. Many must perish in the attempt to resume, and would do better to wind up at once, without attempting to go on, without adequate means, and against appalling obstacles. Another revulsion must come. Thus it was after the last resumption. The banks recommenced payments in 1817--in two years, the failures were more disastrous than ever. Thus it was in England after the long suspension of twenty-six years. Payments recommenced in 1823--in 1825 the most desolating crash of banks took place which had ever been known in the kingdom, although the Bank of England had imported, in less than four years, twenty millions sterling in gold,--about one hundred millions of dollars, to recommence upon. Its effects reached this country, crushed the cotton houses in New Orleans, depressed the money market, and injured all business.

The senators from New York and Virginia (Messrs. Tallmadge and Rives) push this point of confidence a little further; they address a question to me, and ask if I would lose confidence in all steamboats, and have them all discarded, if one or two blew up in the Mississippi? I answer the question in all frankness, and say, that I should not. But if, instead of one or two in the Mississippi, all the steamboats in the Union should blow up at once--in every creek, river and bay--while all the passengers were sleeping in confidence, and the pilots crying out all is well; if the whole should blow up from one end of the Union to the other just as fast as they could hear each other's explosions; then, indeed, I should lose confidence in them, and never again trust wife, or child, or my own foot, or any thing not intended for destruction, on board such sympathetic and contagious engines of death. I answer further, and tell the gentlemen, that if only one or two banks had stopped last May in New York, I should not have lost all confidence in the remaining nine hundred and ninety-nine; but when the whole thousand stopped at once; tumbled down together--fell in a lump--lie there--and when ONE of their number, by a sign with the little finger, can make the whole lie still, then, indeed, confidence is gone! And this is the case with the banks. They have not only stopped altogether, but in a season of profound peace, with eighty millions of specie in the country, and just after the annual examinations by commissioners and legislative committees, and when all was reported well. With eighty millions in the country, they stop even for change! It did not take a national calamity--a war--to stop them! They fell in time of peace and prosperity! We read of people in the West Indies, and in South America, who rebuild their cities on the same spot where earthquakes had overthrown them; we are astonished at their fatuity; we wonder that they will build again on the same perilous foundations. But these people have a reason for their conduct; it is, that their cities are only destroyed by earthquakes; it takes an earthquake to destroy them; and when there is no earthquake, they are safe. But suppose their cities fell down without any commotion in the earth, or the air--fell in a season of perfect calm and serenity--and after that the survivors should go to building again in the same place; would not all the world say that they were demented, and were doomed to destruction? So of the government of the United States by these banks. If it continues to use them, and to receive their notes for revenue, after what has happened, and in the face of what now exists, it argues fatuity, and a doom to destruction.

Resume when they will, or when they shall, and the longer it is delayed the worse for themselves, the epoch of resumption is to be a perilous crisis to many. This stopping and resuming by banks, is the realization of the poetical description of the descent into hell, and the return from it. Facilis descensus Averni--sed revocare gradum--hic opus, hic labor est. Easy is the descent into the regions below, but to return! this is work, this is labor indeed! Our banks have made the descent; they have gone down with ease; but to return--to ascend the rugged steps, and behold again the light above how many will falter, and fall back into the gloomy regions below.

Banks of circulation are banks of hazard and of failure. It is an incident of their nature. Those without circulation rarely fail. That of Venice has stood seven hundred years; those of Hamburgh, Amsterdam, and others, have stood for centuries. The Bank of England, the great mother of banks of circulation, besides an actual stoppage of a quarter of a century, has had her crisis and convulsion in average periods of seven or eight years, for the last half century--in 1783, '93, '97, 1814, '19, '25, '36--and has only been saved from repeated failure by the powerful support of the British government, and profuse supplies of exchequer bills. Her numerous progeny of private and joint stock banks of circulation have had the same convulsions; and not being supported by the government, have sunk by hundreds at a time. All the banks of the United States are banks of circulation; they are all subject to the inherent dangers of that class of banks, and are, besides, subject to new dangers peculiar to themselves. From the quantity of their stock held by foreigners, the quantity of other stocks in their hands, and the current foreign balance against the United States, our paper system has become an appendage to that of England. As such, it suffers from sympathy when the English system suffers. In addition to this, a new doctrine is now broached--that our first duty is to foreigners! and, upon this principle, when the banks of the two countries are in peril, ours are to be sacrificed to save those of England!

The power of a few banks over the whole presents a new feature of danger in our system. It consolidates the banks of the whole Union into one mass, and subjects them to one fate, and that fate to be decided by a few, without even the knowledge of the rest. An unknown divan of bankers sends forth an edict which sweeps over the empire, crosses the lines of States with the facility of a Turkish firman, prostrating all State institutions, breaking up all engagements, and levelling all law before it. This is consolidation of a kind which the genius of Patrick Henry had not even conceived. But while this firman is thus potent and irresistible for prostration, it is impotent and powerless for resurrection. It goes out in vain, bidding the prostrate banks to rise. A veto power intervenes. One voice is sufficient to keep all down; and thus we have seen one word from Philadelphia annihilate the New York proposition for resumption, and condemn the many solvent banks to the continuation of a condition as mortifying to their feelings as it is injurious to their future interests.

Again, from the mode of doing business among our banks--using each other's paper to bank upon, instead of holding each other to weekly settlements, and liquidation of balances in specie, and from the fatal practice of issuing notes at one place, payable at another--our banks have all become links of one chain, the strength of the whole being dependent on the strength of each. A few govern all. Whether it is to fail, or to resume, the few govern; and not only the few, but the weak. A few weak banks fail; a panic ensues, and the rest shut up; many strong ones are ready to resume; the weak are not ready, and the strong must wait. Thus the principles of safety, and the rules of government, are reversed. The weak govern the strong; the bad govern the good; and the insolvent govern the solvent. This is our system, if system it can be called, which has no feature of consistency, no principle of safety, and which is nothing but the floating appendage of a foreign and overpowering system.

The federal government and its creditors have suffered great pecuniary losses from the use of these banks and their paper; they must continue to sustain such losses if they continue to use such depositories and to receive such paper. The pecuniary losses have been, now are, and must be hereafter great; but, great as they have been, now are, and may be hereafter, all that loss is nothing compared to the political dangers which flow from the same source. These dangers affect the life of the government. They go to its existence. They involve anarchy, confusion, violence, dissolution! They go to deprive the government of support--of the means of living; they strip it in an instant of every shilling of revenue, and leave it penniless, helpless, lifeless. The late stoppage might have broken up the government, had it not been for the fidelity and affection of the people to their institutions and the eighty millions of specie which General Jackson had accumulated in the country. That stoppage presented a peculiar feature of peril which has not been brought to the notice of the public; it was the stoppage of the sums standing in the names of disbursing officers, and wanted for daily payments in all the branches of the public service.--These sums amounted to about five millions of dollars. They had been drawn from the Treasury, they were no longer standing to the credit of the United States; they had gone into the hands of innumerable officers and agents, in all parts of the Union, and were temporarily, and for mere safe-keeping from day to day, lodged with these deposit banks, to be incessantly paid out to those who were doing work and labor, performing contracts, or rendering service, civil or military, to the country. These five millions were stopped with the rest! In an instant, as if by enchantment, every disbursing officer, in every part of the Union, was stripped of the money which he was going to pay out! All officers of the government, high and low, the whole army and navy, all the laborers and contractors, post offices and all, were suddenly, instantaneously, left without pay; and consequently without subsistence. It was tantamount to a disbandment of the entire government. It was like a decree for the dissolution of the body politic. It was celebrated as a victory--as a conquest--as a triumph, over the government. The least that was expected was an immediate civil revolution--the overthrow of the democratic party, the change of administration, the reascension of the federal party to power, and the re-establishment of the condemned Bank of the United States. These consequences were counted upon; and that they did not happen was solely owing to the eighty millions of hard money which kept up a standard of value in the country, and prevented the dishonored bank notes from sinking too low to be used by the community. But it is not merely stoppage of the banks that we have to fear: collisions with the States may ensue. State legislatures may sanction the stoppage, withhold the poor right of suing, and thus interpose their authority between the federal government and its revenues. This has already happened, not in hostility to the government, but in protection of themselves; and the consequence was the same as if the intention had been hostile. It was interposition between the federal government and its depositories; it was deprivation of revenue; it was an act the recurrence of which should be carefully guarded against in future.

This is what we have seen; this is a danger which we have just escaped; and if these banks shall be continued as depositories of public money, or, which is just the same thing, if the government shall continue to receive their "paper promises to pay," the same danger may be seen again, and under far more critical circumstances. A similar stoppage of the banks may take place again--will inevitably take place again--and it may be when there is little specie in the country, or when war prevails. All history is full of examples of armies and navies revolting for want of pay; all history is full of examples of military and naval operations miscarried for want of money; all history is full of instances of governments overturned from deficits of revenue and derangements of finances. And are we to expose ourselves recklessly, and with our eyes open, to such dangers? And are we to stake the life and death of this government upon the hazards and contingencies of banking--and of such banking as exists in these United States? Are we to subject the existence of this government to the stoppages of the banks, whether those stoppages result from misfortune, improvidence, or bad faith? Are we to subject this great and glorious political fabric, the work of so many wise and patriotic heads, to be demolished in an instant, and by an unseen hand? Are we to suffer the machinery and the working of our boasted constitution to be arrested by a spring-catch, applied in the dark? Are men, with pens sticking behind their ears, to be allowed to put an end to this republic? No, sir! never. If we are to perish prematurely, let us at least have a death worthy of a great nation; let us at least have a field covered with the bodies of heroes and of patriots, and consecrated forever to the memory of a subverted empire. Rome had her Pharsalia--Greece her Chæronca--and many barbarian kingdoms have given immortality to the spot on which they expired; and shall this great republic be subjected to extinction on the contingencies of trade and banking?

But what excuse, what apology, what justification have we for surrendering, abandoning, and losing the precise advantage for which the present constitution was formed? What was that advantage--what the leading and governing object, which led to the abandonment of the old confederation, and induced the adoption of the present form of government? It was revenue! independent revenue! a revenue under the absolute control of this government, and free from the action of the States. This was the motive--the leading and the governing motive--which led to the formation of this government. The reason was, that the old confederation, being dependent upon the States, was often left without money. This state of being was incompatible with its existence; it deprived it of all power; its imbecility was a proverb. To extricate it from that condition was the design--and the cardinal design--of the new constitution. An independent revenue was given to it--independent, even, of the States. Is it not suicidal to surrender that independence, and to surrender it, not to States, but to money corporations? What does history record of the penury and moneyed destitution of the old confederation, comparable to the annihilation of the revenues of this government in May last? when the banks shut down, in one night, upon a revenue, in hand, of thirty-two millions; even upon that which was in the names of disbursing officers, and refuse a nine-pence, or a picaillon in money, from that day to this? What is there in the history of the old confederation comparable to this? The old confederation was often reduced low--often near empty-handed--but never saw itself stripped in an instant, as if by enchantment, of tens of millions, and heard the shout of triumph thundered over its head, and the notes of exultation sung over its supposed destruction! Yet, this is what we have seen--what we now see--from having surrendered to corporations our moneyed independence, and unwisely abandoned the precise advantage which led to the formation of this federal government.

I do not go into the moral view of this question. It is too obvious, too impressive, too grave, to escape the observation of any one. Demoralization follows in the train of an unconvertible paper money. The whole community becomes exposed to a moral pestilence. Every individual becomes the victim of some imposition; and, in self-defence, imposes upon some one else. The weak, the ignorant, the uninformed, the necessitous, are the sufferers; the crafty and the opulent are the gainers. The evil augments until the moral sense of the community, revolting at the frightful accumulation of fraud and misery, applies the radical remedy of total reform.

Thus, pecuniary, political, and moral considerations require the government to retrace its steps, to return to first principles, and to restore its fiscal action to the safe and solid path of the constitution. Reform is demanded. It is called for by every public and by every private consideration. Now is the time to make it. The connection between Bank and State is actually dissolved. It is dissolved by operation of law, and by the delinquency of these institutions. They have forfeited the right to the deposits, and lost the privilege of paying the revenue in their notes, by ceasing to pay specie. The government is now going on without them, and all that is wanting is the appropriate legislation to perpetuate the divorce which, in point of fact, has already taken place. Now is the time to act; this the moment to restore the constitutional currency to the federal government; to restore the custody of the public moneys to national keepers; and to avoid, in time to come, the calamitous revulsions and perilous catastrophes of 1814, 1819, and 1837.

And what is the obstacle to the adoption of this course, so imperiously demanded by the safety of the republic and the welfare of the people, and so earnestly recommended to us by the chief magistrate? What is the obstacle--what the power that countervails the Executive recommendation, paralyzes the action of Congress, and stays the march of reform? The banks--the banks--the banks, are this obstacle, and this power. They set up the pretension to force their paper into the federal Treasury, and to force themselves to be constituted that Treasury. Though now bankrupt, their paper dishonored, their doors closed against creditors, every public and every private obligation violated, still they arrogate a supremacy over this federal government; they demand the guardianship of the public moneys, and the privilege of furnishing a federal currency; and, though too weak to pay their debts, they are strong enough to throttle this government, and to hold in doubtful suspense the issue of their vast pretensions.

The President, in his message, recommends four things: first, to discontinue the reception of local bank paper in payment of federal dues; secondly, to discontinue the same banks as depositories of the public moneys; thirdly, to make the future collection and disbursement of the public moneys in gold and silver; fourthly, to take the keeping of the public moneys into the hands of our own officers.

What is there in this but a return to the words and meaning of the constitution, and a conformity to the practice of the government in the first years of President Washington's administration? When this federal government was first formed, there was no Bank of the United States, and no local banks, except three north of the Potomac. By the act of 1789, the revenues were directed to be collected in gold and silver coin only; and it was usually drawn out of the hands of collectors by drafts drawn upon them, payable at sight. It was a most effectual way of drawing money out of their hands; far more so than an order to deposit in banks; for the drafts must be paid, or protested, at sight, while the order to deposit may be eluded under various pretexts.

The right and the obligation of the government to keep its own moneys in its own hands, results from first principles, and from the great law of self-preservation. Every thing else that belongs to her, she keeps herself; and why not keep that also, without which every thing else is nothing? Arms and ships--provisions, munitions, and supplies of every kind--are kept in the hands of government officers; money is the sinew of war, and why leave this sinew exposed to be cut by any careless or faithless hand? Money is the support and existence of the government--the breath of its nostrils, and why leave this support--this breath--to the custody of those over whom we have no control? How absurd to place our ships, our arms, our military and naval supplies in the hands of those who could refuse to deliver them when requested, and put the government to a suit at law to recover their possession! Every body sees the absurdity of this; but to place our money in the same condition, and, moreover, to subject it to the vicissitudes of trade and the perils of banking, is still more absurd; for it is the life blood, without which the government cannot live--the oil, without which no part of its machinery can move.

England, with all her banks, trusts none of them with the collection, keeping, and disbursement of her public moneys. The Bank of England is paid a specific sum to manage the public debt; but the revenue is collected and disbursed through subordinate collectors and receivers general; and these receivers general are not subject to the bankrupt laws, because the government will not suffer its revenue to be operated upon by any law except its own will. In France, subordinate collectors and receivers general collect, keep, and disburse the public moneys. If they deposit any thing in banks, it is at their own risk. It is the same thing in England. A bank deposit by an officer is at the risk of himself and his securities. Too much of the perils and vicissitudes of banking is known in these countries to permit the government ever to jeopard its revenues in their keeping. All this is shown, fully and at large, in a public document now on our tables. And who does not recognize in these collectors and receivers general of France and England, the ancient Roman officers of quæstors and proquæstors? These fiscal officers of France and England are derivations from the Roman institutions; and the same are found in all the modern kingdoms of Europe which were formerly, like France and Britain, provinces of the Roman empire. The measure before the Senate is to enable us to provide for our future safety, by complying with our own constitution, and conforming to the practice of all nations, great or small, ancient or modern.

Coming nearer home, and looking into our own early history, what were the "continental treasurers" of the confederation, and the "provincial treasurers and collectors," provided for as early as July, 1775, but an imitation of the French and English systems, and very near the plan which we propose now to re-establish! These continental treasurers, and there were two of them at first, though afterwards reduced to one, were the receivers general; the provincial treasurers and collectors were their subordinates. By these officers the public moneys were collected, kept, and disbursed; for there were no banks then! and all government drafts were drawn directly upon these officers. This simple plan worked well during the Revolution, and afterwards, until the new government was formed; and continued to work, with a mere change of names and forms, during the first years of Washington's administration, and until General Hamilton's bank machinery got into play. This bill only proposes to re-establish, in substance, the system of the Revolution, of the Congress of the confederation, and of the first years of Washington's administration.

The bill reported by the chairman of the Committee on Finance [Mr. WRIGHT of New York] presents the details of the plan for accomplishing this great result. That bill has been printed and read. Its simplicity, economy, and efficiency strike the sense of all who hear it, and annihilate without argument, the most formidable arguments of expense and patronage, which had been conceived against it. The present officers, the present mints, and one or two more mints in the South, in the West, and in the North, complete the plan. There will be no necessity to carry masses of hard money from one quarter of the Union to another. Government drafts will make the transfer without moving a dollar. A government draft upon a national mint, will be the highest order of bills of exchange. Money wanted by the government in one place, will be exchanged, through merchants, for money in another place. Thus it has been for thousands of years, and will for ever be. We read in Cicero's letters that, when he was Governor of Cilicia, in Asia Minor, he directed his quæstor to deposit the tribute of the province in Antioch, and exchange it for money in Rome with merchants engaged in the Oriental trade, of which Antioch was one of the emporiums. This is the natural course of things, and is too obvious to require explanation, or to admit of comment.

We are taunted with these treasury notes; it seems to be matter of triumph that the government is reduced to the necessity of issuing them; but with what justice? And how soon can any government that wishes it, emerge from the wretchedness of depreciated paper, and stand erect on the solid foundations of gold and silver? How long will it take any respectable government, that so wills it, to accomplish this great change? Our own history, at the close of the Revolution, answers the question; and more recently, and more strikingly, the history of France answers it also. I speak of the French finances from 1800 to 1807; from the commencement of the consulate to the peace of Tilsit. This wonderful period is replete with instruction on the subject of finance and currency. The whole period is full of instruction; but I can only seize two views--the beginning and the end--and, for the sake of precision, will read what I propose to present. I read from Bignon, author of the civil and diplomatic history of France during the consulate and the first years of the empire; written at the testamentary request of the Emperor himself.

After stating that the expenditures of the republic were six hundred millions of francs--about one hundred and ten millions of dollars--when Bonaparte became First Consul, the historian proceeds:

"At his arrival at power, a sum of 160,000 francs in money [about $32,000] was all that the public chests contained. In the impossibility of meeting the current service by the ordinary receipts, the Directorial Government had resorted to ruinous expedients, and had thrown into circulation bills of various values, and which sunk upon the spot fifty to eighty per cent. A part of the arrearages had been discharged in bills two-thirds on credit, payable to the bearer, but which, in fact, the treasury was not able to pay when due. The remaining third had been inscribed in the great book, under the name of consolidated third. For the payment of the forced requisitions to which they had been obliged to have recourse, there had been issued bills receivable in payment of the revenues. Finally, the government, in order to satisfy the most imperious wants, gave orders upon the receivers general, delivered in advance to contractors, which they negotiated before they began to furnish the supplies for which they were the payment."

This, resumed Mr. B., was the condition of the French finances when Bonaparte became First Consul at the close of the year 1799. The currency was in the same condition--no specie--a degraded currency of assignats, ruinously depreciated, and issued as low as ten sous. That great man immediately began to restore order to the finances, and solidity to the currency. Happily a peace of three years enabled him to complete the great work, before he was called to celebrate the immortal campaigns ending at Austerlitz, Jena, and Friedland. At the end of three years--before the rupture of the peace of Amiens--the finances and the currency were restored to order and to solidity; and, at the end of six years, when the vast establishments, and the internal ameliorations of the imperial government, had carried the annual expenses to eight hundred millions of francs, about one hundred and sixty millions of dollars; the same historian copying the words of the Minister of Finance, thus speaks of the treasury, and the currency:

"The resources of the State have increased beyond its wants; the public chests are full; all payments are made at the day named; the orders upon the public treasury have become the most approved bills of exchange. The finances are in the most happy condition; France alone, among all the States of Europe, has no paper money."

What a picture! how simply, how powerfully drawn! and what a change in six years! Public chests full--payments made to the day--orders on the treasury the best bills of exchange--France alone, of all Europe, having no paper money; meaning no government paper money, for there were bank notes of five hundred francs, and one thousand francs. A government revenue of one hundred and sixty millions of dollars was paid in gold and silver; a hard money currency, of five hundred and fifty millions of dollars, saturated all parts of France with specie, and made gold and silver the every day currency of every man, woman and child, in the empire. These great results were the work of six years, and were accomplished by the simple process of gradually requiring hard money payments--gradually calling in the assignats--increasing the branch mints to fourteen, and limiting the Bank of France to an issue of large notes--five hundred francs and upwards. This simple process produced these results, and thus stands the French currency at this day; for the nation has had the wisdom to leave untouched the financial system of Bonaparte.

I have repeatedly given it as my opinion--many of my speeches declare it--that the French currency is the best in the world. It has hard money for the government; hard money for the common dealings of the people; and large notes for large transactions. This currency has enabled France to stand two invasions, the ravaging of 300,000 men, two changes of dynasty, and the payment of a milliard of contributions; and all without any commotion or revulsion in trade. It has saved her from the revulsions which have afflicted England and our America for so many years. It has saved her from expansions, contractions, and ruinous fluctuations of price. It has saved her, for near forty years, from a debate on currency. It has saved her even from the knowledge of our sweet-scented phrases: "sound currency--unsound currency; plethoric, dropsical, inflated, bloated; the money market tight to-day--a little easier this morning;" and all such verbiage, which the haberdashers' boys repeat. It has saved France from even a discussion on currency; while in England, and with us, it is banks! banks! banks!--morning, noon, and night; breakfast, dinner, and supper; levant, and couchant; sitting, or standing; at home, or abroad; steamboat, or railroad car; in Congress, or out of Congress, it is all the same thing: banks--banks--banks; currency--currency--currency; meaning, all the while, paper money and shin-plasters; until our very brains seem as if they would be converted into lampblack and rags.

The bill before the Senate dispenses with the further use of banks as depositories of the public moneys. In that it has my hearty concurrence. Four times heretofore, and on four different occasions, I have made propositions to accomplish a part of the same purpose. First, in proposing an amendment to the deposit bill of 1836, by which the mint, and the branch mints, were to be included in the list of depositories; secondly, in proposing that the public moneys here, at the seat of Government, should be kept and paid out by the Treasurer; thirdly, by proposing that a preference, in receiving the deposits, should be given to such banks as should cease to be banks of circulation; fourthly, in opposing the establishment of a bank agency in Missouri, and proposing that the moneys there should be drawn direct from the hands of the receivers. Three of these propositions are now included in the bill before the Senate; and the whole object at which they partially aimed is fully embraced. I am for the measure--fully, cordially, earnestly for it.

Congress has a sacred duty to perform in reforming the finances, and the currency; for the ruin of both has resulted from federal legislation, and federal administration. The States at the formation of the constitution, delivered a solid currency--I will not say sound, for that word implies subject to unsoundness, to rottenness, and to death--but they delivered a solid currency, one not liable to disease, to this federal government. They started the new government fair upon gold and silver. The first act of Congress attested this great fact; for it made the revenues payable in gold and silver coin only. Thus the States delivered a solid currency to this government, and they reserved the same currency for themselves; and they provided constitutional sanctions to guard both. The thing to be saved, and the power to save it, was given to this government by the States; and in the hands of this government it became deteriorated. The first great error was General Hamilton's construction of the act of 1789, by which he nullified that act, and overturned the statute and the constitution together. The next great error was the establishment of a national bank of circulation, with authority to pay all the public dues in its own paper. This confirmed the overthrow of the constitution, and of the statute of 1789; and it set the fatal example to the States to make banks, and to receive their paper for public dues, as the United States had done. This was the origin of the evil--this the origin of the overthrow of the solid currency which the States had delivered to the federal government. It was the Hamiltonian policy that did the mischief; and the state of things in 1837, is the natural fruit of that policy. It is time for us to quit it--to return to the constitution and the statute of 1789, and to confine the federal Treasury to the hard money which was intended for it.

I repeat, this is a measure of reform, worthy to be called a reformation. It goes back to a fundamental abuse, nearly coeval with the foundation of the government. Two epochs have occurred for the reformation of this abuse; one was lost, the other is now in jeopardy. Mr. Madison's administration committed a great error at the expiration of the charter of the first Bank of the United States, in not reviving the currency of the constitution for the federal Treasury, and especially the gold currency. That error threw the Treasury back upon the local bank paper. This paper quickly failed, and out of that failure grew the second United States Bank. Those who put down the second United States Bank, warned by the calamity, determined to avoid the error of Mr. Madison's administration: they determined to increase the stock of specie, and to revive the gold circulation, which had been dead for thirty years. The accumulation of eighty millions in the brief space of five years, fifteen millions of it in gold, attest the sincerity of their design, and the facility of its execution. The country was going on at the rate of an average increase of twelve millions of specie per annum, when the general stoppages of the banks in May last, the exportation of specie, and the imposition of irredeemable paper upon the government and the people, seemed to announce the total failure of the plan. But it was a seeming only. The impetus given to the specie policy still prevails, and five millions are added to the stock during the present fiscal year. So far, then, as the counteraction of the government policy, and the suppression of the constitutional currency, might have been expected to result from that stoppage, the calculation seems to be in a fair way to be disappointed. The spirit of the people, and our hundred millions of exportable produce, are giving the victory to the glorious policy of our late illustrious President. The other great consequences expected to result from that stoppage, namely, the recharter of the Bank of the United States, the change of administration, the overthrow of the republican party, and the restoration of the federal dynasty, all seem to be in the same fair way to total miscarriage; but the objects are too dazzling to be abandoned by the party interested, and the destruction of the finances and the currency, is still the cherished road to success. The miscalled Bank of the United States, the soul of the federal dynasty, and the anchor of its hopes--believed by many to have been at the bottom of the stoppages in May, and known by all to be at the head of non-resumption--now displays her policy on this floor; it is to compel the repetition of the error of Mr. Madison's administration! Knowing that from the repetition of this error must come the repetition of the catastrophes of 1814, 1819, and 1837; and out of these catastrophes to extract a new clamor for the revivification of herself. This is her line of conduct; and to this line, the conduct of all her friends conforms. With one heart, one mind, one voice, they labor to cut off gold and silver from the federal government, and to impose paper upon it! they labor to deprive it of the keeping of its own revenues, and to place them again where they have been so often lost! This is the conduct of that bank and its friends. Let us imitate their zeal, their unanimity, and their perseverance. The amendment and the bill now before the Senate, embodies our policy. Let us carry them, and the republic is safe.

The extra session had been called to relieve the distress of the federal treasury, and had done so by authorizing an issue of treasury notes. That object being accomplished, and the great measures for the divorce of Bank and State, and for the sole use of gold and silver in federal payments, having been recommended, and commenced, the session adjourned.

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Chapter XVI

FIRST REGULAR SESSION UNDER MR. VAN BUREN'S ADMINISTRATION: HIS MESSAGE.

A brief interval of two months only intervened between the adjournment of the called session and the meeting of the regular one; and the general state of the public affairs, both at home and abroad, being essentially the same at both periods, left no new or extraordinary measures for the President to recommend. With foreign powers we were on good terms, the settlement of all our long-standing complaints under General Jackson's administration having left us free from the foreign controversies which gave trouble; and on that head the message had little but what was agreeable to communicate. Its topics were principally confined to home affairs, and that part of these affairs which were connected with the banks. That of the United States, as it still called itself, gave a new species of disregard of moral and legal obligation, and presented a new mode of depraving the currency and endangering property and contracts, by continuing to issue and to use the notes of the expired institution. Its currency was still that of the defunct bank. It used the dead notes of that institution, for which, of course, neither bank was liable. They were called resurrection notes; and their use, besides the injury to the currency and danger to property, was a high contempt and defiance of the authority which had created it; and called for the attention of the federal government. The President, therefore, thus formally brought the procedure to the notice of Congress:

"It was my hope that nothing would occur to make necessary, on this occasion, any allusion to the late national bank. There are circumstances, however, connected with the present state of its affairs that bear so directly on the character of the government and the welfare of the citizen, that I should not feel myself excused in neglecting to notice them. The charter which terminated its banking privileges on the 4th of March, 1836, continued its corporate powers two years more, for the sole purpose of closing its affairs, with authority 'to use the corporate name, style, and capacity, for the purpose of suits for a final settlement and liquidation of the affairs and acts of the corporation, and for the sale and disposition of their estate, real, personal and mixed, but for no other purpose or in any other manner whatsoever.' Just before the banking privileges ceased, its effects were transferred by the bank to a new State institution then recently incorporated, in trust, for the discharge of its debts and the settlement of its affairs. With this trustee, by authority of Congress, an adjustment was subsequently made of the large interest which the government had in the stock of the institution. The manner in which a trust unexpectedly created upon the act granting the charter, and involving such great public interests, has been executed, would, under any circumstances, be a fit subject of inquiry; but much more does it deserve your attention, when it embraces the redemption of obligations to which the authority and credit of the United States have given value. The two years allowed are now nearly at an end. It is well understood that the trustee has not redeemed and cancelled the outstanding notes of the bank, but has reissued, and is actually reissuing, since the 3d of March, 1836, the notes which have been received by it to a vast amount. According to its own official statement, so late as the 1st of October last, nineteen months after the banking privileges given by the charter had expired, it had under its control uncancelled notes of the late Bank of the United States to the amount of twenty-seven millions five hundred and sixty-one thousand eight hundred and sixty-six dollars, of which six millions one hundred and seventy-five thousand eight hundred and sixty-one dollars were in actual circulation, one million four hundred and sixty-eight thousand six hundred and twenty-seven dollars at State bank agencies, and three millions two thousand three hundred and ninety dollars in transitu; thus showing that upwards of ten millions and a half of the notes of the old bank were then still kept outstanding. The impropriety of this procedure is obvious: it being the duty of the trustee to cancel and not to put forth the notes of an institution, whose concerns it had undertaken to wind up. If the trustee has a right to reissue these notes now, I can see no reason why it may not continue to do so after the expiration of the two years. As no one could have anticipated a course so extraordinary, the prohibitory clause of the charter above quoted was not accompanied by any penalty or other special provision for enforcing it; nor have we any general law for the prevention of similar acts in future.

"But it is not in this view of the subject alone that your interposition is required. The United States, in settling with the trustee for their stock, have withdrawn their funds from their former direct ability to the creditors of the old bank, yet notes of the institution continue to be sent forth in its name, and apparently upon the authority of the United States. The transactions connected with the employment of the bills of the old bank are of vast extent; and should they result unfortunately, the interests of individuals may be deeply compromised. Without undertaking to decide how far, or in what form, if any, the trustee could be made liable for notes which contain no obligation on its part; or the old bank, for such as are put in circulation after the expiration of its charter, and without its authority; or the government for indemnity, in case of loss, the question still presses itself upon your consideration, whether it is consistent with duty and good faith on the part of the government, to witness this proceeding without a single effort to arrest it."

On the subject of the public lands, and the most judicious mode of disposing of them--a question of so much interest to the new States--the message took the view of those who looked to the domain less as a source of revenue than as a means of settling and improving the country. He recommended graduated prices according to the value of the different classes of lands in order to facilitate their sale; and a prospective permanent pre-emption act to give encouragement to settlers. On the first of these points he said:

"Hitherto, after being offered at public sale, lands have been disposed of at one uniform price, whatever difference there might be in their intrinsic value. The leading considerations urged in favor of the measure referred to, are, that in almost all the land districts, and particularly in those in which the lands have been long surveyed and exposed to sale, there are still remaining numerous and large tracts of every gradation of value, from the government price downwards; that these lands will not be purchased at the government price, so long as better can be conveniently obtained for the same amount; that there are large tracts which even the improvements of the adjacent lands will never raise to that price; and that the present uniform price, combined with their irregular value, operates to prevent a desirable compactness of settlement in the new States, and to retard the full development of that wise policy on which our land system is founded, to the injury not only of the several States where the lands lie, but of the United States as a whole.

"The remedy proposed has been a reduction of prices according to the length of time the lands have been in market, without reference to any other circumstances. The certainty that the efflux of time would not always in such cases, and perhaps not even generally, furnish a true criterion of value; and the probability that persons residing in the vicinity, as the period for the reduction of prices approached, would postpone purchases they would otherwise make, for the purpose of availing themselves of the lower price, with other considerations of a similar character, have hitherto been successfully urged to defeat the graduation upon time. May not all reasonable desires upon this subject be satisfied without encountering any of these objections? All will concede the abstract principle, that the price of the public lands should be proportioned to their relative value, so far as that can be accomplished without departing from the rule, heretofore observed, requiring fixed prices in cases of private entries. The difficulty of the subject seems to lie in the mode of ascertaining what that value is. Would not the safest plan be that which has been adopted by many of the States as the basis of taxation; an actual valuation of lands, and classification of them into different rates? Would it not be practicable and expedient to cause the relative value of the public lands in the old districts, which have been for a certain length of time in market, to be appraised, and classed into two or more rates below the present minimum price, by the officers now employed in this branch of the public service, or in any other mode deemed preferable, and to make those prices permanent, if upon the coming in of the report they shall prove satisfactory to Congress? Cannot all the objects of graduation be accomplished in this way, and the objections which have hitherto been urged against it avoided? It would seem to me that such a step, with a restriction of the sales to limited quantities, and for actual improvement, would be free from all just exception."

A permanent prospective pre-emption law was cogently recommended as a measure just in itself to the settlers, and not injurious to the public Treasury, as experience had shown that the auction system--that of selling to the highest bidder above the prescribed minimum price--had produced in its aggregate but a few cents on the acre above the minimum price. On this point he said:

"A large portion of our citizens have seated themselves on the public lands, without authority, since the passage of the last pre-emption law and now ask the enactment of another, to enable them to retain the lands occupied, upon payment of the minimum government price. They ask that which has been repeatedly granted before. If the future may be judged of by the past, little harm can be done to the interests of the Treasury by yielding to their request. Upon a critical examination, it is found that the lands sold at the public sales since the introduction of cash payments in 1820, have produced, on an average, the net revenue of only six cents an acre more than the minimum government price. There is no reason to suppose that future sales will be more productive. The government, therefore, has no adequate pecuniary interest to induce it to drive these people from the lands they occupy, for the purpose of selling them to others."

This wise recommendation has since been carried into effect, and pre-emptive rights are now admitted in all cases where settlements are made upon lands to which the Indian title shall have been extinguished; and the graduation of the price of the public lands, though a measure long delayed, yet prevailed in the end, and was made as originally proposed, by reductions according to the length of time the land had been offered at sale. Beginning at the minimum price of $1 25 per acre, the reduction of price went down through a descending scale, according to time, as low as 12-1/2 cents per acre. But this was long after.

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XVII. PENNSYLVANIA BANK OF THE UNITED STATES. ITS USE OF THE DEFUNCT NOTES OF THE EXPIRED INSTITUTION

History gives many instances of armies refusing to be disbanded, and remaining in arms in defiance of the authority which created them; but the example of this bank presents, probably, the first instance in which a great moneyed corporation refused to be dissolved--refused to cease its operations after its legal existence had expired;--and continued its corporate transactions as if in full life. It has already been shown that its proviso charter, at the end of a local railroad act, made no difference in its condition--that it went on exactly as before. Its use of the defunct notes of the expired institution was a further instance of this conduct, transcending any thing conceived of, and presenting a case of danger to the public, and defiance of government, which the President had deemed it his duty to bring to the attention of Congress, and ask a remedy for a proceeding so criminal. Congress acted on the recommendation, and a bill was brought in to make the repetition of the offence a high misdemeanor, and the officers and managers of the institution personally and individually liable for its commission. In support of this bill, Mr. Buchanan gave the fullest and clearest account of this almost incredible misconduct. He said:

"The charter of the late Bank of the United States expired, by its own limitation, on the 3d of March, 1836. After that day, it could issue no notes, discount no new paper, and exercise none of the usual functions of a bank. For two years thereafter, until the 3d of March, 1838, it was merely permitted to use its corporate name and capacity 'for the purpose of suits for the final settlement and liquidation of the affairs and accounts of the corporation, and for the sale and disposition of their estate, real, personal, and mixed; but not for any other purpose, or in any other manner, whatsoever.' Congress had granted the bank no power to make a voluntary assignment of its property to any corporation or any individual. On the contrary, the plain meaning of the charter was, that all the affairs of the institution should be wound up by its own president and directors. It received no authority to delegate this important trust to others, and yet what has it done? On the second day of March, 1836, one day before the charter had expired, this very president and these directors assigned all the property and effects of the old corporation to the Pennsylvania Bank of the United States. On the same day, this latter bank accepted the assignment, and agreed to 'pay, satisfy, and discharge all debts, contracts, and engagements, owing, entered into, or made by this [the old] bank, as the same shall become due and payable, and fulfil and execute all trusts and obligations whatsoever arising from its transactions, or from any of them, so that every creditor or rightful claimant shall be fully satisfied.' By its own agreement, it has thus expressly created itself a trustee of the old bank. But this was not necessary to confer upon it that character. By the bare act of accepting the assignment, it became responsible, under the laws of the land, for the performance of all the duties and trusts required by the old charter. Under the circumstances, it cannot make the slightest pretence of any want of notice.

"Having assumed this responsibility, the duty of the new bank was so plain that it could not have been mistaken. It had a double character to sustain. Under the charter from Pennsylvania, it became a new banking corporation; whilst, under the assignment from the old bank, it became a trustee to wind up the concerns of that institution under the Act of Congress. These two characters were in their nature separate and distinct, and never ought to have been blended. For each of these purposes it ought to have kept a separate set of books. Above all, as the privilege of circulating bank notes, and thus creating a paper currency is that function of a bank which most deeply and vitally affects the community, the new bank ought to have cancelled or destroyed all the notes of the old bank which it found in its possession on the 4th of March, 1836, and ought to have redeemed the remainder at its counter, as they were demanded by the holders, and then destroyed them. This obligation no senator has attempted to doubt, or to deny. But what was the course of the bank? It has grossly violated both the old and the new charter. It at once declared independence of both, and appropriated to itself all the notes of the old bank,--not only those which were then still in circulation, but those which had been redeemed before it accepted the assignment, and were then lying dead in its vaults. I have now before me the first monthly statement which was ever made by the Bank to the Auditor-general of Pennsylvania. It is dated on the 2d of April, 1836, and signed J. Cowperthwaite, acting cashier. In this statement, the Bank charges itself with 'notes issued,' $36,620,420 16; whilst, in its cash account, along with its specie and the notes of State banks, it credits itself with 'notes of the Bank of the United States and offices,' on hand, $16,794,713 71. It thus seized these dead notes to the amount of $16,794,713 71, and transformed them into cash; whilst the difference between those on hand and those issued, equal to $19,825,706 45, was the circulation which the new bank boasted it had inherited from the old. It thus, in an instant, appropriated to itself, and adopted as its own circulation, all the notes and all the illegal branch drafts of the old bank which were then in existence. Its boldness was equal to its utter disregard of law. In this first return, it not only proclaimed to the Legislature and people of Pennsylvania that it had disregarded its trust as assignee of the old Bank, by seizing upon the whole of the old circulation and converting it to its own use, but that it had violated one of the fundamental provisions of its new charter."

Mr. Calhoun spoke chiefly to the question of the right of Congress to pass a bill of the tenor proposed. Several senators denied that right others supported it--among them Mr. Wright, Mr. Grundy, Mr. William H. Roane, Mr. John M. Niles, Mr. Clay, of Alabama, and Mr. Calhoun. Some passages from the speech of the latter are here given.

"He [Mr. Calhoun] held that the right proposed to be exercised in this case rested on the general power of legislation conferred on Congress, which embraces not only the power of making, but that of repealing laws. It was, in fact, a portion of the repealing power. No one could doubt the existence of the right to do either, and that the right of repealing extends as well to unconstitutional as constitutional laws. The case as to the former was, in fact, stronger than the latter; for, whether a constitutional law should be repealed or not, was a question of expediency, which left us free to act according to our discretion; while, in the case of an unconstitutional law, it was a matter of obligation and duty, leaving no option; and the more unconstitutional, the more imperious the obligation and duty. Thus far, there could be no doubt nor diversity of opinion. But there are many laws, the effects of which do not cease with their repeal or expiration, and which require some additional act on our part to arrest or undo them. Such, for instance, is the one in question. The charter of the late bank expired some time ago, but its notes are still in existence, freely circulating from hand to hand, and reissued and banked on by a bank chartered by the State of Pennsylvania, into whose possession the notes of the old bank have passed. In a word, our name and authority are used almost as freely for banking purposes as they were before the expiration of the charter of the late bank. Now, he held that the right of arresting or undoing these after-effects rested on the same principle as the right of repealing a law, and, like that, embraces unconstitutional as well as constitutional acts, superadding, in the case of the former, obligation and duty to right. We have an illustration of the truth of this principle in the case of the alien and sedition acts, which are now conceded on all sides to have been unconstitutional. Like the act incorporating the late bank, they expired by their own limitation; and, like it, also, their effects continued after the period of their expiration. Individuals had been tried, convicted, fined, and imprisoned under them; but, so far was their unconstitutionality from being regarded as an impediment to the right of arresting or undoing these effects, that Mr. Jefferson felt himself compelled on that very account to pardon those who had been fined and convicted under their provisions, and we have at this session passed, on the same ground, an act to refund the money paid by one of the sufferers under them. The bill is limited to those only who are the trustees, or agents for winding up the concerns of the late bank, and it is those, and those only, who are subject to the penalties of the bill for reissuing its notes. They are, pro tanto, our officers, and, to that extent, subject to our jurisdiction, and liable to have their acts controlled as far as they relate to the trust or agency confided to them; just as much so as receivers or collectors of the revenue would be. No one can doubt that we could prohibit them from passing off any description of paper currency that might come into their hands in their official character. Nor is the right less clear in reference to the persons who may be comprehended in this bill. Whether Mr. Biddle or others connected with this bank are, in fact, trustees, or agents, within the meaning of the bill, is not a question for us to decide. They are not named, nor referred to by description. The bill is very properly drawn up in general terms, so as to comprehend all cases of the kind, and would include the banks of the District, should Congress refuse to re-charter them. It is left to the court and jury, to whom it properly belongs, to decide, when a case comes up, whether the party is, or is not, a trustee, or agent; and, of course, whether he is, or is not, included in the provisions of the bill. If he is, he will be subject to its penalties, but not otherwise; and it cannot possibly affect the question of the constitutionality of the bill, whether Mr. Biddle, and others connected with him, are, or are not, comprehended in its provisions, and subject to its penalties."

The bill was severe in its enactments, prescribing both fine and imprisonment for the repetition of the offence--the fine not to exceed ten thousand dollars--the imprisonment not to be less than one nor more than five years. It also gave a preventive remedy in authorizing injunctions from the federal courts to prevent the circulation of such defunct notes, and proceedings in chancery to compel their surrender for cancellation. And to this "complexion" had the arrogant institution come which so lately held itself to be a power, and a great one, in the government--now borne on the statute book as criminally liable for a high misdemeanor, and giving its name to a new species of offence in the criminal catalogue--exhumer and resurrectionist of defunct notes. And thus ended the last question between the federal government and this, once so powerful moneyed corporation; and certainly any one who reads the history of that bank as faithfully shown in our parliamentary history, and briefly exhibited in this historic View, can ever wish to see another national bank established in our country, or any future connection of any kind between the government and the banks. The last struggle between it and the government was now over--just seven years since that struggle began: but its further conduct will extort a further notice from history.

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XVIII. FLORIDA INDIAN WAR: ITS ORIGIN AND CONDUCT

This was one of the most troublesome, expensive and unmanageable Indian wars in which the United States had been engaged; and from the length of time which it continued, the amount of money it cost, and the difficulty of obtaining results, it became a convenient handle of attack upon the administration; and in which party spirit, in pursuit of its object, went the length of injuring both individual and national character. It continued about seven years--as long as the revolutionary war--cost some thirty millions of money--and baffled the exertions of several generals; recommenced when supposed to be finished; and was only finally terminated by changing military campaigns into an armed occupation by settlers. All the opposition presses and orators took hold of it, and made its misfortunes the common theme of invective and declamation. Its origin was charged to the oppressive conduct of the administration--its protracted length to their imbecility--its cost to their extravagance--its defeats to the want of foresight and care. The Indians stood for an innocent and persecuted people. Heroes and patriots were made of their chiefs. Our generals and troops were decried; applause was lavished upon a handful of savages who could thus defend their country; and corresponding censure upon successive armies which could not conquer them. All this going incessantly into the Congress debates and the party newspapers, was injuring the administration at home, and the country abroad; and, by dint of iteration and reiteration, stood a good chance to become history, and to be handed down to posterity. At the same time the war was one of flagrant and cruel aggression on the part of these Indians. Their removal to the west of the Mississippi was part of the plan for the general removal of all the Indians, and every preparation was complete for their departure by their own agreement, when it was interrupted by a horrible act. It was the 28th day of December, 1835, that the United States agent in Florida, and several others, were suddenly massacred by a party under Osceola, who had just been at the hospitable table with them: at the same time the sutler and others were attacked as they sat at table: same day two expresses were killed: and to crown these bloody deeds, the same day witnessed the destruction of Major Dade's command of 112 men, on its march from Tampa Bay to Withlacootchee. All these massacres were surprises, the result of concert, and executed as such upon unsuspecting victims. The agent (Mr. Thompson), and some friends were shot from the bushes while taking a walk near his house: the sutler and his guests were shot at the dinner table: the express riders were waylaid, and shot in the road: Major Dade's command was attacked on the march, by an unseen foe, overpowered, and killed nearly to the last man. All these deadly attacks took place on the same day, and at points wide apart--showing that the plot was as extensive as it was secret, and cruel as it was treacherous; for not a soul was spared in either of the four relentless attacks.

It was two days after the event that an infantry soldier of Major Dade's command, appeared at Fort King, on Tampa Bay, from which it had marched six days before, and gave information of what had happened. The command was on the march, in open pine woods, tall grass all around, and a swamp on the left flank. The grass concealed a treacherous ambuscade. The advanced guard had passed, and was cut off. Both the advance and the main body were attacked at the same moment, but divided from each other. A circle of fire enclosed each--fire from an invisible foe. To stand, was to be shot down: to advance was to charge upon concealed rifles. But it was the only course--was bravely adopted--and many savages thus sprung from their coverts, were killed. The officers, courageously exposing themselves, were rapidly shot--Major Dade early in the action. At the end of an hour successive charges had roused the savages from the grass, (which seemed to be alive with their naked and painted bodies, yelling and leaping,) and driven beyond the range of shot. But the command was too much weakened for a further operation. The wounded were too numerous to be carried along: too precious to be left behind to be massacred. The battle ground was maintained, and a small band had conquered respite from attack: but to advance or retreat was equally impossible. The only resource was to build a small pen of pine logs, cut from the forest, collect the wounded and the survivors into it, as into a little fort, and repulse the assailants as long as possible. This was done till near sunset--the action having began at ten in the morning. By that time every officer was dead but one, and he desperately wounded, and helpless on the ground. Only two men remained without wounds, and they red with the blood of others, spirted upon them, or stained in helping the helpless. The little pen was filled with the dead and the dying. The firing ceased. The expiring lieutenant told the survivors he could do no more for them, and gave them leave to save themselves as they could. They asked his advice. He gave it to them; and to that advice we are indebted for the only report of that bloody day's work. He advised them all to lay down among the dead--to remain still--and take their chance of being considered dead. This advice was followed. All became still, prostrate and motionless; and the savages, slowly and cautiously approaching, were a long time before they would venture within the ghastly pen, where danger might still lurk under apparent death. A squad of about forty negroes--fugitives from the Southern States, more savage than the savage--were the first to enter. They came in with knives and hatchets, cutting throats and splitting skulls wherever they saw a sign of life. To make sure of skipping no one alive, all were pulled and handled, punched and kicked; and a groan or movement, an opening of the eye, or even the involuntary contraction of a muscle, was an invitation to the knife and the tomahawk. Only four of the living were able to subdue sensations, bodily and mental, and remain without sign of feeling under this dreadful ordeal; and two of these received stabs, or blows--as many of the dead did. Lying still until the search was over, and darkness had come on, and the butchers were gone, these four crept from among their dead comrades and undertook to make their way back to Tampa Bay--separating into two parties for greater safety. The one that came in first had a narrow escape. Pursuing a path the next day, an Indian on horseback, and with a rifle across the saddle bow, met them full in the way. To separate, and take the chance of a divided pursuit, was the only hope for either: and they struck off into opposite directions. The one to the right was pursued; and very soon the sharp crack of a rifle made known his fate to the one that had gone to the left. To him it was a warning, that his comrade being despatched, his own turn came next. It was open pine woods, and a running, or standing man, visible at a distance. The Indian on horseback was already in view. Escape by flight was impossible. Concealment in the grass, or among the palmettos, was the only hope: and this was tried. The man laid close: the Indian rode near him. He made circles around, eyeing the ground far and near. Rising in his stirrups to get a wider view, and seeing nothing, he turned the head of his horse and galloped off--the poor soldier having been almost under the horse's feet. This man, thus marvellously escaping, was the first to bring in the sad report of the Dade defeat--followed soon after by two others with its melancholy confirmation. And these were the only reports ever received of that completest of defeats. No officer survived to report a word. All were killed in their places--men and officers, each in his place, no one breaking ranks or giving back: and when afterwards the ground was examined, and events verified by signs, the skeletons in their places, and the bullet holes in trees and logs, and the little pen with its heaps of bones, showed that the carnage had taken place exactly as described by the men. And this was the slaughter of Major Dade and his command--of 108 out of 112: as treacherous, as barbarous, as perseveringly cruel as ever was known. One single feature is some relief to the sadness of the picture, and discriminates this defeat from most others suffered at the hands of Indians. There were no prisoners put to death; for no man surrendered. There were no fugitives slain in vain attempts at flight; for no one fled. All stood, and fought, and fell in their places, returning blow for blow while life lasted. It was the death of soldiers, showing that steadiness in defeat which is above courage in victory.

And this was the origin of the Florida Indian war: and a more treacherous, ferocious, and cold-blooded origin was never given to any Indian war. Yet such is the perversity of party spirit that its author--the savage Osceola--has been exalted into a hero-patriot; our officers, disparaged and ridiculed; the administration loaded with obloquy. And all this by our public men in Congress, as well as by writers in the daily and periodical publications. The future historian who should take these speeches and publications for their guide, (and they are too numerous and emphatic to be overlooked,) would write a history discreditable to our arms, and reproachful to our justice. It would be a narrative of wickedness and imbecility on our part--of patriotism and heroism on the part of the Indians: those Indians whose very name (Seminole--wild,) define them as the fugitives from all tribes, and made still worse than fugitive Indians by a mixture with fugitive negroes, some of whom became their chiefs. It was to obviate the danger of such a history as that would be, that the author of this View delivered at the time, and in the presence of all concerned, an historical speech on the Florida Indian war, fortified by facts, and intended to stand for true; and which has remained unimpeached. Extracts from that speech will constitute the next chapter, to which this brief sketch will serve as a preface and introduction.

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XIX. FLORIDA INDIAN WAR: HISTORICAL SPEECH OF MR. BENTON

A senator from New Jersey [Mr. SOUTHARD] has brought forward an accusation which must affect the character of the late and present administrations at home, and the character of the country abroad; and which, justice to these administrations, and to the country, requires to be met and answered upon the spot. That senator has expressly charged that a fraud was committed upon the Florida Indians in the treaty negotiated with them for their removal to the West; that the war which has ensued was the consequence of this fraud; and that our government was responsible to the moral sense of the community, and of the world, for all the blood that has been shed, and for all the money that has been expended, in the prosecution of this war. This is a heavy accusation. At home, it attaches to the party in power, and is calculated to make them odious; abroad, it attaches to the country, and is calculated to blacken the national character. It is an accusation, without the shadow of a foundation! and, both, as one of the party in power, and as an American citizen, I feel myself impelled by an imperious sense of duty to my friends, and to my country, to expose its incorrectness at once, and to vindicate the government, and the country, from an imputation as unfounded as it is odious.

The senator from New Jersey first located this imputed fraud in the Payne's Landing treaty, negotiated by General Gadsden, in Florida, in the year 1832; and, after being tendered an issue on the fairness and generosity of that treaty by the senator from Alabama [Mr. CLAY], he transferred the charge to the Fort Gibson treaty, made in Arkansas, in the year 1833, by Messrs. Stokes, Ellsworth and Schermerhorn. This was a considerable change of locality, but no change in the accusation itself; the two treaties being but one, and the last being a literal performance of a stipulation contained in the first. These are the facts; and, after stating the case, I will prove it as stated. This is the statement: The Seminole Indians in Florida being an emigrant band of the Creeks, and finding game exhausted, subsistence difficult, and white settlements approaching, concluded to follow the mother tribe, the Creeks, to the west of the Mississippi, and to reunite with them. This was conditionally agreed to be done at the Payne's Landing treaty; and in that treaty it was stipulated that a deputation of Seminole chiefs, under the sanction of the government of the United States, should proceed to the Creek country beyond the Mississippi--there to ascertain first whether a suitable country could be obtained for them there; and, secondly, whether the Creeks would receive them back as a part of their confederacy: and if the deputation should be satisfied on these two points, then the conditional obligation to remove, contained in the Payne's Landing treaty, to become binding and obligatory upon the Seminole tribe. The deputation went: the two points were solved in the affirmative the obligation to remove became absolute on the part of the Indians; and the government of the United States commenced preparations for effecting their easy, gradual, and comfortable removal.

The entire emigration was to be completed in three years, one-third going annually, commencing in the year 1833, and to be finished in the years 1834, and 1835. The deputation sent to the west of the Mississippi, completed their agreement with the Creeks on the 28th of March, 1833; they returned home immediately, and one-third of the tribe was to remove that year. Every thing was got ready on the part of the United States, both to transport the Indians to their new homes, and to subsist them for a year after their arrival there. But, instead of removing, the Indians began to invent excuses, and to interpose delays, and to pass off the time without commencing the emigration. The year 1833, in which one-third of the tribe were to remove, passed off without any removal; the year 1834, in which another third was to go, was passed off in the same manner; the year 1835, in which the emigration was to have been completed, passed away, and the emigration was not begun. On the contrary, on the last days of the last month of that year, while the United States was still peaceably urging the removal, an accumulation of treacherous and horrible assassinations and massacres were committed. The United States agent, General Thompson, Lieutenant Smith, of the artillery, and five others, were assassinated in sight of Fort King; two expresses were murdered; and Major Dade's command was massacred.

In their excuses and pretexts for not removing, the Indians never thought of the reasons which have been supplied to them on this floor. They never thought of alleging fraud. Their pretexts were frivolous; as that it was a long distance, and that bad Indians lived in that country, and that the old treaty of Fort Moultrie allowed them twenty years to live in Florida. Their real motive was the desire of blood and pillage on the part of many Indians, and still more on the part of the five hundred runaway negroes mixed up among them; and who believed that they could carry on their system of robbery and murder with impunity, and that the swamps of the country would for ever protect them against the pursuit of the whites.

This, Mr. President, is the plain and brief narrative of the causes which led to the Seminole war; it is the brief historical view of the case; and if I was speaking under ordinary circumstances, and in reply to incidental remarks, I should content myself with this narrative, and let the question go to the country upon the strength and credit of this statement. But I do not speak under ordinary circumstances; I am not replying to incidental and casual remarks. I speak in answer to a formal accusation, preferred on this floor; I speak to defend the late and present administrations from an odious charge; and, in defending them, to vindicate the character of our country from the accusation of the senator from New Jersey [Mr. SOUTHARD], and to show that fraud has not been committed upon these Indians, and that the guilt of a war, founded in fraud, is not justly imputable to them.

The Seminoles had stipulated that the agent, Major Phagan, and their own interpreter, the negro Abraham, should accompany them; and this was done. It so happened, also, that an extraordinary commission of three members sent out by the United States to adjust Indian difficulties generally, was then beyond the Mississippi; and these commissioners were directed to join in the negotiations on the part of the United States, and to give the sanction of our guarantee to the agreements made between the Seminoles and the Creeks for the reunion of the former to the parent tribe. This was done. Our commissioners, Messrs. Stokes, Ellsworth, and Schermerhorn, became party to a treaty with the Creek Indians for the reunion of the Seminoles, made at Fort Gibson, the 14th of February, 1833. The treaty contained this article:

"ARTICLE IV. It is understood and agreed that the Seminole Indians of Florida, whose removal to this country is provided for by their treaty with the United States, dated May 9, 1832, shall also have a permanent and comfortable home on the lands hereby set apart as the country of the Creek nation; and they, the Seminoles, will hereafter be considered as a constituent part of the said nation, but are to be located on some part of the Creek country by themselves, which location shall be selected for them by the commissioners who have seen these articles of agreement."

This agreement with the Creeks settled one of the conditions on which the removal of the Seminoles was to depend. We will now see how the other condition was disposed of.

In a treaty made at the same Fort Gibson, on the 28th of March, 1833, between the same three commissioners on the part of the United States, and the seven delegated Seminole chiefs, after reciting the two conditions precedent contained in the Payne's Landing treaty, and reciting, also, the convention with the Creeks on the 14th of February preceding, it is thus stipulated:

"Now, therefore, the commissioners aforesaid, by virtue of the power and authority vested in them by the treaty made with the Creek Indians on the 14th of February, 1833, as above stated, hereby designate and assign to the Seminole tribe of Indians, for their separate future residence for ever, a tract of country lying between the Canadian River and the south fork thereof, and extending west to where a line running north and south between the main Canadian and north branch will strike the forks of Little River; provided said west line does not extend more than twenty-five miles west from the mouth of said Little River. And the undersigned Seminole chiefs, delegated as aforesaid, on behalf of the nation, hereby declare themselves well satisfied with the location provided for them by the commissioners, and agree that their nation shall commence the removal to their new home as soon as the government will make the arrangements for their emigration satisfactory to the Seminole nation."

This treaty is signed by the delegation, and by the commissioners of the United States, and witnessed, among others, by the same Major Phagan, agent, and Abraham, interpreter, whose presence was stipulated for at Payne's Landing.

Thus the two conditions on which the removal depended, were complied with; they were both established in the affirmative. The Creeks, under the solemn sanction and guarantee of the United States, agree to receive back the Seminoles as a part of their confederacy, and agree that they shall live adjoining them on lands designated for their residence. The delegation declare themselves well satisfied with the country assigned them, and agree that the removal should commence as soon as the United States could make the necessary arrangements for the removal of the people.

This brings down the proof to the conclusion of all questions beyond the Mississippi; it brings it down to the conclusion of the treaty at Fort Gibson--that treaty in which the senator from New Jersey [Mr. SOUTHARD] has located the charge of fraud, after withdrawing the same charge from the Payne's Landing treaty. It brings us to the end of the negotiations at the point selected for the charge; and now how stands the accusation? How stands the charge of fraud? Is there a shadow, an atom, a speck, of foundation on which to rest it? No, sir: Nothing--nothing--nothing! Every thing was done that was stipulated for; done by the persons who were to do it; and done in the exact manner agreed upon. In fact, the nature of the things to be done west of the Mississippi was such as not to admit of fraud. Two things were to be done, one to be seen with the eyes, and the other to be heard with the ears. The deputation was to see their new country, and say whether they liked it. This was a question to their own senses--to their own eyes--and was not susceptible of fraud. They were to hear whether the Creeks would receive them back as a part of their confederacy; this was a question to their own ears, and was also unsusceptible of fraud. Their own eyes could not deceive them in looking at land; their own ears could not deceive them in listening to their own language from the Creeks. No, sir: there was no physical capacity, or moral means, for the perpetration of fraud; and none has ever been pretended by the Indians from that day to this. The Indians themselves have never thought of such a thing. There is no assumption of a deceived party among them. It is not a deceived party that is at war--a party deceived by the delegation which went to the West--but that very delegation itself, with the exception of Charley Emarthla, are the hostile leaders at home! This is reducing the accusation to an absurdity. It is making the delegation the dupes of their own eyes and of their own ears, and then going to war with the United States, because their own eyes deceived them in looking at land on the Canadian River, and their own ears deceived them in listening to their own language from the Creeks; and then charging these frauds upon the United States. All this is absurd; and it is due to these absent savages to say that they never committed any such absurdity--that they never placed their objection to remove upon any plea of deception practised upon them beyond the Mississippi, but on frivolous pretexts invented long after the return of the delegation; which pretexts covered the real grounds growing out of the influence of runaway slaves, and some evilly disposed chiefs, and that thirst for blood and plunder, in which they expected a long course of enjoyment and impunity in their swamps, believed to be impenetrable to the whites.

Thus, sir, it is clearly and fully proved that there was no fraud practised upon these Indians; that they themselves never pretended such a thing; and that the accusation is wholly a charge of recent origin sprung up among ourselves. Having shown that there was no fraud, this might be sufficient for the occasion, but having been forced into the inquiry, it may be as well to complete it by showing what were the causes of this war. To understand these causes, it is necessary to recur to dates, to see the extreme moderation with which the United States acted, the long time which they tolerated the delays of the Indians, and the treachery and murder with which their indulgence and forbearance was requited. The emigration was to commence in 1833, and be completed in the years 1834 and 1835. The last days of the last month of this last year had arrived, and the emigration had not yet commenced. Wholly intent on their peaceable removal, the administration had despatched a disbursing agent, Lieutenant Harris of the army, to take charge of the expenditures for the subsistence of these people. He arrived at Fort King on the afternoon of the 28th of December, 1835; and as he entered the fort, he became almost an eye-witness of a horrid scene which was the subject of his first despatch to his government. He describes it in these words:

"I regret that it becomes my first duty after my arrival here to be the narrator of a story, which it will be, I am sure, as painful for you to hear, as it is for me, who was almost an eye witness to the bloody deed, to relate to you. Our excellent superintendent, General Wiley Thompson, has been most cruelly murdered by a party of the hostile Indians, and with him Lieutenant Constant Smith, of the 2d regiment of artillery, Erastus Rogers, the suttler to the post, with his two clerks, a Mr. Kitzler, and a boy called Robert. This occurred on the afternoon of the 28th instant (December), between three and four o'clock. On the day of the massacre, Lieutenant Smith had dined with the General, and after dinner invited him to take a short stroll with him. They had not proceeded more than three hundred yards beyond the agency office, when they were fired upon by a party of Indians, who rose from ambush in the hammock, within sight of the fort, and on which the suttler's house borders. The reports of the rifles fired, the war-whoop twice repeated, and after a brief space, several other volleys more remote, and in the quarter of Mr. Rogers's house, were heard, and the smoke of the firing seen from the fort. Mr. Rogers and his clerks were surprised at dinner. Three escaped: the rest murdered. The bodies of General Thompson, Lieutenant Smith, and Mr. Kitzler, were soon found and brought in. Those of the others were not found until this morning. That of General Thompson was perforated with fourteen bullets. Mr. Rogers had received seventeen. All were scalped, except the boy. The cowardly murderers are supposed to be a party of Micasookees, 40 or 50 strong, under the traitor Powell (Osceola), whose shrill, peculiar war-whoop, was recognized by our interpreters, and the one or two friendly Indians we have in the fort, and who knew it well. Two expresses (soldiers) were despatched upon fresh horses on the evening of this horrid tragedy, with tidings of it to General Clinch; but not hearing from him or them, we conclude they were cut off. We are also exceedingly anxious for the fate of the two companies (under Major Dade) which had been ordered up from Fort Brooke, and of whom we learn nothing."

Sir, this is the first letter of the disbursing agent, specially detached to furnish the supplies to the emigrating Indians. He arrives in the midst of treachery and murder; and his first letter is to announce to the government the assassination of their agent, an officer of artillery, and five citizens; the assassination of two expresses, for they were both waylaid and murdered; and the massacre of one hundred and twelve men and officers under Major Dade. All this took place at once; and this was the beginning of the war. Up to that moment the government of the United States were wholly employed in preparing the Indians for removal, recommending them to go, and using no force or violence upon them. This is the way the war was brought on; this is the way it began; and was there ever a case in which a government was so loudly called upon to avenge the dead, to protect the living, and to cause itself to be respected by punishing the contemners of its power? The murder of the agent was a double offence, a peculiar outrage to the government whose representative he was, and a violation even of the national law of savages. Agents are seldom murdered even by savages; and bound as every government is to protect all its citizens, it is doubly bound to protect its agents and representatives abroad. Here, then, is a government agent, and a military officer, five citizens, two expresses, and a detachment of one hundred and twelve men, in all one hundred and twenty-one persons, treacherously and inhumanly massacred in one day! and because General Jackson's administration did not submit to this horrid outrage, he is charged with the guilt of a war founded in fraud upon innocent and unoffending Indians! Such is the spirit of opposition to our own government! such the love of Indians and contempt of whites! and such the mawkish sentimentality of the day in which we live--a sentimentality which goes moping and sorrowing about in behalf of imaginary wrongs to Indians and negroes, while the whites themselves are the subject of murder, robbery and defamation.

The prime mover in all this mischief, and the leading agent in the most atrocious scene of it, was a half-blooded Indian of little note before this time, and of no consequence in the councils of his tribe; for his name is not to be seen in the treaty either of Payne's Landing or Fort Gibson. We call him Powell; by his tribe he was called Osceola. He led the attack in the massacre of the agent, and of those who were killed with him, in the afternoon of the 28th of December. The disbursing agent, whose letter has been read, in his account of that massacre, applies the epithet traitor to the name of this Powell. Well might he apply that epithet to that assassin; for he had just been fed and caressed by the very person whom he waylaid and murdered. He had come into the agency shortly before that time with seventy of his followers, professed his satisfaction with the treaty, his readiness to remove, and received subsistence and supplies for himself and all his party. The most friendly relations seemed to be established; and the doomed and deceived agent, in giving his account of it to the government, says: "The result was that we closed with the utmost good feeling; and I have never seen Powell and the other chiefs so cheerful and in so fine a humor, at the close of a discussion upon the subject of removal."

This is Powell (Osceola), for whom all our sympathies are so pathetically invoked! a treacherous assassin, not only of our people, but of his own--for he it was who waylaid, and shot in the back, in the most cowardly manner, the brave chief Charley Emarthla, whom he dared not face, and whom he thus assassinated because he refused to join him and his runaway negroes in murdering the white people. The collector of Indian curiosities and portraits, Mr. Catlin, may be permitted to manufacture a hero out of this assassin, and to make a poetical scene of his imprisonment on Sullivan's island; but it will not do for an American senator to take the same liberties with historical truth and our national character. Powell ought to have been hung for the assassination of General Thompson; and the only fault of our officers is, that they did not hang him the moment they caught him. The fate of Arbuthnot and Ambrister was due to him a thousand times over.

I have now answered the accusation of the senator from New Jersey [Mr. SOUTHARD]. I have shown the origin of this war. I have shown that it originated in no fraud, no injustice, no violence, on the part of this government, but in the thirst for blood and rapine on the part of these Indians, and in their confident belief that their swamps would be their protection against the pursuit of the whites; and that, emerging from these fastnesses to commit robbery and murder, and retiring to them to enjoy the fruits of their marauding expeditions, they had before them a long perspective of impunity in the enjoyment of their favorite occupation. This I have shown to be the cause of the war; and having vindicated the administration and the country from the injustice of the imputation cast upon them, I proceed to answer some things said by a senator from South Carolina [Mr. PRESTON], which tended to disparage the troops generally which have been employed in Florida; to disparage a particular general officer, and also to accuse that general officer of a particular and specified offence. That senator has decried our troops in Florida for the general inefficiency of their operations; he has decried General Jesup for the general imbecility of his operations, and he has charged this General with the violation of a flag, and the commission of a perfidious act, in detaining and imprisoning the Indian Powell, who came into his camp.

I think there is great error and great injustice in all these imputations, and that it is right for some senator on this floor to answer them. My position, as chairman of the Committee on Military Affairs, would seem to assign that duty to me, and it may be the reason why others who have spoken have omitted all reply on these points. Be that as it may, I feel impelled to say something in behalf of those who are absent, and cannot speak for themselves--those who must always feel the wound of unmerited censure, and must feel it more keenly when the blow that inflicts the wound falls from the elevated floor of the American Senate. So far as the army, generally, is concerned in this censure, I might leave them where they have been placed by the senator from South Carolina [Mr. PRESTON], and others on that side of the House, if I could limit myself to acting a political part here. The army, as a body, is no friend of the political party to which I belong. Individuals among them are friendly to the administration; but, as a body, they go for the opposition, and would terminate our political existence, if they could, and put our opponents in our place, at the first general election that intervenes. Asa politician, then, I might abandon them to the care of their political friends; but, as an American, as a senator, and as having had some connection with the military profession, I feel myself called upon to dissent from the opinion which has been expressed, and to give my reasons for believing that the army has not suffered, and ought not to suffer, in character, by the events in Florida. True, our officers and soldiers have not performed the same feats there which they performed in Canada, and elsewhere. But why? Certainly because they have not got the same, or an equivalent, theatre to act upon, nor an enemy to cope with over whom brilliant victories can be obtained. The peninsula of Florida, where this war rages, is sprinkled all over with swamps, hammocks, and lagoons, believed for three hundred years to be impervious to the white man's tread. The theatre of war is of great extent, stretching over six parallels of latitude; all of it in the sultry region below thirty-one degrees of north latitude. The extremity of this peninsula approaches the tropic of Capricorn; and at this moment, while we speak here, the soldier under arms at mid-day there will cast no shadow: a vertical sun darts its fiery rays direct upon the crown of his head. Suffocating heat oppresses the frame; annoying insects sting the body; burning sands, a spongy morass, and the sharp cutting saw grass, receive the feet and legs; disease follows the summer's exertion; and a dense foliage covers the foe. Eight months in the year military exertions are impossible; during four months only can any thing be done. The Indians well understand this; and, during these four months, either give or receive an attack, as they please, or endeavor to consume the season in wily parleys. The possibility of splendid military exploits does not exist in such a country, and against such a foe: but there is room there, and ample room there, for the exhibition of the highest qualities of the soldier. There is room there for patience, and for fortitude, under every variety of suffering, and under every form of privation. There is room there for courage and discipline to exhibit itself against perils and trials which subject courage and discipline to the severest tests. And has there been any failure of patience, fortitude, courage, discipline, and subordination in all this war? Where is the instance in which the men have revolted against their officers, or in which the officer has deserted his men? Where is the instance of a flight in battle? Where the instance of orders disobeyed, ranks broken, or confusion of corps? On the contrary, we have constantly seen the steadiness, and the discipline, of the parade maintained under every danger, and in the presence of massacre itself. Officers and men have fought it out where they were told to fight; they have been killed in the tracks in which they were told to stand. None of those pitiable scenes of which all our Indian wars have shown some--those harrowing scenes in which the helpless prisoner, or the hapless fugitive, is massacred without pity, and without resistance: none of these have been seen. Many have perished; but it was the death of the combatant in arms, and not of the captive or the fugitive. In no one of our savage wars have our troops so stood together, and conquered together, and died together, as they have done in this one; and this standing together is the test of the soldier's character. Steadiness, subordination, courage, discipline,--these are the test of the soldier; and in no instance have our troops, or any troops, ever evinced the possession of these qualities in a higher degree than during the campaigns in Florida. While, then, brilliant victories may not have been seen, and, in fact, were impossible, yet the highest qualities of good soldiership have been eminently displayed throughout this war. Courage and discipline have shown themselves, throughout all its stages, in their noblest forms.

From the general imputation of inefficiency in our operations in Florida, the senator from South Carolina [Mr. PRESTON] comes to a particular commander, and charges inefficiency specifically upon him. This commander is General Jesup. The senator from South Carolina has been lavish, and even profuse, in his denunciation of that general, and has gone so far as to talk about military courts of inquiry. Leaving the general open to all such inquiry, and thoroughly convinced that the senator from South Carolina has no idea of moving such inquiry, and intends to rest the effect of his denunciation upon its delivery here, I shall proceed to answer him here--giving speech for speech on this floor, and leaving the general himself to reply when it comes to that threatened inquiry, which I undertake to affirm will never be moved.

General Jesup is charged with imbecility and inefficiency; the continuance of the war is imputed to his incapacity; and he is held up here, on the floor of the Senate, to public reprehension for these imputed delinquencies. This is the accusation; and now let us see with how much truth and justice it is made. Happily for General Jesup, this happens to be a case in which we have data to go upon, and in which there are authentic materials for comparing the operations of himself with those of other generals--his predecessors in the same field--with whose success the senator from South Carolina is entirely satisfied. Dates and figures furnish this data and these materials; and, after refreshing the memory of the Senate with a few dates, I will proceed to the answers which the facts of the case supply. The first date is, as to the time of the commencement of this war; the second, as to the time that General Jesup assumed the command; the third, as to the time when he was relieved from the command. On the first point, it will be recollected that the war broke out upon the assassination of General Thompson, the agent, Lieutenant Smith, who was with him; the sutler and his clerks; the murder of the two expresses; and the massacre of Major Dade's command;--events which came together in point of time, and compelled an immediate resort to war by the United States. These assassinations, these murders, and this massacre, took place on the 28th day of December, 1835. The commencement of the war, then, dates from that day. The next point is, the time of General Jesup's appointment to the command. This occurred in December, 1836. The third point is, the date of General Jesup's relief from the command, and this took place in May, of the present year, 1838. The war has then continued--counting to the present time--two years and a half; and of that period, General Jesup has had command something less than one year and a half. Other generals had command for a year before he was appointed in that quarter. Now, how much had those other generals done? All put together, how much had they done? And I ask this question not to disparage their meritorious exertions, but to obtain data for the vindication of the officer now assailed. The senator from South Carolina [Mr. PRESTON] is satisfied with the operations of the previous commanders; now let him see how the operations of the officer whom he assails will compare with the operations of those who are honored with his approbation. The comparison is brief and mathematical. It is a problem in the exact sciences. General Jesup reduced the hostiles in the one year and a half of his command, 2,200 souls: all his predecessors together had reduced them 150 in one year. Where does censure rest now?

Sir, I disparage nobody. I make no exhibit of comparative results to undervalue the operations of the previous commanders in Florida. I know the difficulty of military operations there, and the ease of criticism here. I never assailed those previous commanders; on the contrary, often pointed out the nature of the theatre on which they operated as a cause for the miscarriage of expeditions, and for the want of brilliant and decisive results. Now for the first time I refer to the point, and, not to disparage others, but to vindicate the officer assailed. His vindication is found in the comparison of results between himself and his predecessors, and in the approbation of the senator from South Carolina of the results under the predecessors of General Jesup. Satisfied with them, he must be satisfied with him; for the difference is as fifteen to one in favor of the decried general.

Besides the general denunciation for inefficiency, which the senator from South Carolina has lavished upon General Jesup, and which denunciation has so completely received its answer in this comparative statement; besides this general denunciation, the senator from South Carolina brought forward a specific accusation against the honor of the same officer--an accusation of perfidy, and of a violation of flag of truce, in the seizure and detention of the Indian Osceola, who had come into his camp. On the part of General Jesup, I repel this accusation, and declare his whole conduct in relation to this Indian, to have been justifiable, under the laws of civilized or savage warfare; that it was expedient in point of policy; and that if any blame could attach to the general, it would be for the contrary of that with which he is blamed; it would be for an excess of forbearance and indulgence.

The justification of the general for the seizure and detention of this half-breed Indian, is the first point; and that rests upon several and distinct grounds, either of which fully justifies the act.

1. This Osceola had broken his parole; and, therefore, was liable to be seized and detained.

The facts were these: In the month of May, 1837, this chief, with his followers, went into Fort Mellon, under the cover of a white flag, and there surrendered to Lieutenant Colonel Harney. He declared himself done with the war, and ready to emigrate to the west of the Mississippi, and solicited subsistence and transportation for himself and his people for that purpose. Lieutenant Colonel Harney received him, supplied him with provisions, and, relying upon his word and apparent sincerity, instead of sending him under guard, took his parole to go to Tampa Bay, the place at which he preferred to embark, to take shipping there for the West. Supplied with every thing, Osceola and his people left Fort Mellon, under the pledge to go to Tampa Bay. He never went there! but returned to the hostiles; and it was afterwards ascertained that he never had any idea of going West, but merely wished to live well for a while at the expense of the whites, examine their strength and position, and return to his work of blood and pillage. After this, he had the audacity to approach General Jesup's camp in October of the same year, with another piece of white cloth over his head, thinking, after his successful treacheries to the agent, General Thompson, and Lieut. Colonel Harney, that there was no end to his tricks upon white people. General Jesup ordered him to be seized and carried a prisoner to Sullivan's Island, where he was treated with the greatest humanity, and allowed every possible indulgence and gratification. This is one of the reasons in justification of General Jesup's conduct to that Indian, and it is sufficient of itself; but there are others, and they shall be stated.

2. Osceola had violated an order in coming in, with a view to return to the hostiles; and, therefore, was liable to be detained.

The facts were these: Many Indians, at different times, had come in under the pretext of a determination to emigrate; and after receiving supplies, and viewing the strength and position of the troops, returned again to the hostiles, and carried on the war with renewed vigor. This had been done repeatedly. It was making a mockery of the white flag, and subjecting our officers to ridicule as well as to danger. General Jesup resolved to put an end to these treacherous and dangerous visits, by which spies and enemies obtained access to the bosom of his camp. He made known to the chief, Coi Hadjo, his determination to that effect. In August, 1837, he declared peremptorily to this chief, for the information of all the Indians, that none were to come in, except to remain, and to emigrate; that no one coming into his camp again should be allowed to go out of it, but should be considered as having surrendered with a view to emigrate under the treaty, and should be detained for that purpose. In October, Osceola came in, in violation of that order, and was detained in compliance with it. This is a second reason for the justification of General Jesup, and is of itself sufficient to justify him; but there is more justification yet, and I will state it.

3. Osceola, had broken a truce, and, therefore, was liable to be detained whenever he could be taken.

The facts were these: The hostile chiefs entered into an agreement for a truce at Fort King, in August, 1837, and agreed: 1. Not to commit any act of hostility upon the whites; 2. Not to go east of the St. John's river, or north of Fort Mellon. This truce was broken by the Indians in both points. A citizen was killed by them, and they passed both to the east of the St. John's and far north of Fort Mellon. As violators of this truce, General Jesup had a right to detain any of the hostiles which came into his hands, and Osceola was one of these.

Here, sir, are three grounds of justification, either of them sufficient to justify the conduct of General Jesup towards Powell, as the gentlemen call him. The first of the three reasons applies personally and exclusively to that half-breed; the other two apply to all the hostile Indians, and justify the seizure and detention of others, who have been sent to the West.

So much for justification; now for the expediency of having detained this Indian Powell. I hold it was expedient to exercise the right of detaining him, and prove this expediency by reasons both a priori and a posteriori. His previous treachery and crimes, and his well known disposition for further treachery and crimes, made it right for the officers of the United States to avail themselves of the first justifiable occasion to put an end to his depredations by confining his person until the war was over. This is a reason a priori. The reason a posteriori is, that it has turned out right; it has operated well upon the mass of the Indians, between eighteen and nineteen hundred of which, negroes inclusive, have since surrendered to Gen. Jesup. This, sir, is a fact which contains an argument which overturns all that can be said on this floor against the detention of Osceola. The Indians themselves do not view that act as perfidious or dishonorable, or the violation of a flag, or even the act of an enemy. They do not condemn General Jesup on account of it, but no doubt respect him the more for refusing to be made the dupe of a treacherous artifice. A bit of white linen, stripped, perhaps from the body of a murdered child, or its murdered mother, was no longer to cover the insidious visits of spies and enemies. A firm and manly course was taken, and the effect was good upon the minds of the Indians. The number since surrendered is proof of its effect upon their minds; and this proof should put to blush the lamentations which are here set up for Powell, and the censure thrown upon General Jesup.

No, sir, no. General Jesup has been guilty of no perfidy, no fraud, no violation of flags. He has done nothing to stain his own character, or to dishonor the flag of the United States. If he has erred, it has been on the side of humanity, generosity, and forbearance to the Indians. If he has erred, as some suppose, in losing time to parley with the Indians, that error has been on the side of humanity, and of confidence in them. But has he erred? Has his policy been erroneous? Has the country been a loser by his policy? To all these questions, let results give the answer. Let the twenty-two hundred Indians, abstracted from the hostile ranks by his measures, be put in contrast with the two hundred, or less, killed and taken by his predecessors. Let these results be compared; and let this comparison answer the question whether, in point of fact, there has been any error, even a mistake of judgment, in his mode of conducting the war.

The senator from South Carolina [Mr. PRESTON] complains of the length of time which General Jesup has consumed without bringing the war to a close. Here, again, the chapter of comparisons must be resorted to in order to obtain the answer which justice requires. How long, I pray you, was General Jesup in command? from December, 1836, to May, 1838; nominally he was near a year and a half in command; in reality not one year, for the summer months admit of no military operations in that peninsula. His predecessors commanded from December, 1835, to December, 1836; a term wanting but a few months of as long a period as the command of General Jesup lasted. Sir, there is nothing in the length of time which this general commanded, to furnish matter for disadvantageous comparisons to him; but the contrary. He reduced the hostiles about one-half in a year and a half; they reduced them about the one-twentieth in a year. The whole number was about 5,000; General Jesup diminished their number, during his command, 2,200; the other generals had reduced them about 150. At the rate he proceeded, the work would be finished in about three years; at the rate they proceeded, in about twenty years. Yet he is to be censured here for the length of time consumed without bringing the war to a close. He, and he alone, is selected for censure. Sir, I dislike these comparisons; it is a disagreeable task for me to make them; but I am driven to it, and mean no disparagement to others. The violence with which General Jesup is assailed here--the comparisons to which he has been subjected in order to degrade him--leave me no alternative but to abandon a meritorious officer to unmerited censure, or to defend him in the same manner in which he has been assailed.

The essential policy of General Jesup has been to induce the Indians to come in--to surrender--and to emigrate under the treaty. This has been his main, but not his exclusive, policy; military operations have been combined with it; many skirmishes and actions have been fought since he had command; and it is remarkable that this general, who has been so much assailed on this floor, is the only commander-in-chief in Florida who has been wounded in battle at the head of his command. His person marked with the scars of wounds received in Canada during the late war with Great Britain, has also been struck by a bullet, in the face, in the peninsula of Florida; yet these wounds--the services in the late war with Great Britain--the removal of upwards of 16,000 Creek Indians from Alabama and Georgia to the West, during the summer of 1836--and more than twenty-five years of honorable employment in the public service--all these combined, and an unsullied private character into the bargain, have not been able to protect the feelings of this officer from laceration on this floor. Have not been sufficient to protect his feelings! for, as to his character, that is untouched. The base accusation--the vague denunciation--the offensive epithets employed here, may lacerate feelings, but they do not reach character; and as to the military inquiry, which the senator from South Carolina speaks of, I undertake to say that no such inquiry will ever take place. Congress, or either branch of Congress, can order an inquiry if it pleases; but before it orders an inquiry, a probable cause has to be shown for it; and that probable cause never has been, and never will be, shown in General Jesup's case.

The senator from South Carolina speaks of the large force which was committed to General Jesup, and the little that was effected with that force. Is the senator aware of the extent of the country over which his operations extended? that it extended from 31 to 25 degrees of north latitude? that it began in the Okefenokee swamp in Georgia, and stretched to the Everglades in Florida? that it was near five hundred miles in length in a straight line, and the whole sprinkled over with swamps, one of which alone was equal in length to the distance between Washington City and Philadelphia? But it was not extent of country alone, with its fastnesses, its climate, and its wily foe, that had to be contended with; a new element of opposition was encountered by General Jesup, in the poisonous information which was conveyed to the Indians' minds, which encouraged them to hold out, and of which he had not even knowledge for a long time. This was the quantity of false information which was conveyed to the Indians, to stimulate and encourage their resistance. General Jesup took command just after the presidential election of 1836. The Indians were informed of this change of presidents, and were taught to believe that the white people had broke General Jackson--that was the phrase--had broke General Jackson for making war upon them. They were also informed that General Jesup was carrying on the war without the leave of Congress; that Congress would give no more money to raise soldiers to fight them; and that he dared not come home to Congress. Yes, he dared not come home to Congress! These poor Indians seem to have been informed of intended movements against the general in Congress, and to have relied upon them both to stop supplies and to punish the general. Moreover, they were told, that, if they surrendered to emigrate, they would receive the worst treatment on the way; that, if a child cried, it would be thrown overboard; if a chief gave offence, he would be put in irons. Who the immediate informants of all these fine stories were, cannot be exactly ascertained. They doubtless originated with that mass of fanatics, devoured by a morbid sensibility for negroes and Indians, which are now Don Quixoting over the land, and filling the public ear with so many sympathetic tales of their own fabrication.

General Jesup has been censured for writing a letter disparaging to his predecessor in command. If he did so, and I do not deny it, though I have not seen the letter, nobly has he made the amends. Publicly and officially has he made amends for a private and unofficial wrong. In an official report to the war department, published by that department, he said:

"As an act of justice to all my predecessors in command, I consider it my duty to say that the difficulties attending military operations in this country, can be properly appreciated only by those acquainted with them. I have advantages which neither of them possessed, in better preparations and more abundant supplies; and I found it impossible to operate with any prospect of success, until I had established a line of depots across the country. If I have at any time said aught in disparagement of the operations of others in Florida, either verbally or in writing, officially or unofficially, knowing the country as I now know it, I consider myself bound as a man of honor solemnly to retract it."

Such are the amends which General Jesup makes--frank and voluntary--full and kindly--worthy of a soldier towards brother soldiers; and far more honorable to his predecessors in command than the disparaging comparisons which have been instituted here to do them honor at his expense.

The expenses of this war is another head of attack pressed into this debate, and directed more against the administration than against the commanding general. It is said to have cost twenty millions of dollars; but that is an error--an error of near one-half. An actual return of all expenses up to February last, amounts to nine and a half millions; the rest of the twenty millions go to the suppression of hostilities in other places, and with other Indians, principally in Georgia and Alabama, and with the Cherokees and Creeks. Sir, this charge of expense seems to be a standing head with the opposition at present. Every speech gives us a dish of it; and the expenditures under General Jackson and Mr. Van Buren are constantly put in contrast with those of previous administrations. Granted that these expenditures are larger--that they are greatly increased; yet what are they increased for? Are they increased for the personal expenses of the officers of the government, or for great national objects? The increase is for great objects; such as the extinction of Indian titles in the States east of the Mississippi--the removal of whole nations of Indians to the west of the Mississippi--their subsistence for a year after they arrive there--actual wars with some tribes--the fear of it with others, and the consequent continual calls for militia and volunteers to preserve peace--large expenditures for the permanent defences of the country, both by land and water, with a pension list for ever increasing; and other heads of expenditure which are for future national benefit; and not for present individual enjoyment. Stripped of all these heads of expenditure, and the expenses of the present administration have nothing to fear from a comparison with other periods. Stated in the gross, as is usually done, and many ignorant people are deceived and imposed upon, and believe that there has been a great waste of public money; pursued into the detail, and these expenditures will be found to have been made for great national objects--objects which no man would have undone, to get back the money, even if it was possible to get back the money by undoing the objects. No one, for example, would be willing to bring back the Creeks, the Cherokees, the Choctaws, and Chickasaws into Alabama, Mississippi, Georgia, Tennessee and North Carolina, even if the tens of millions which it has cost to remove them could be got back by that means; and so of the other expenditures: yet these eternal croakers about expense are blaming the government for these expenditures.

Sir, I have gone over the answers, which I proposed to make to the accusations of the senators from New Jersey and South Carolina. I have shown them to be totally mistaken in all their assumptions and imputations. I have shown that there was no fraud upon the Indians in the treaty at Fort Gibson--that the identical chiefs who made that treaty have since been the hostile chiefs--that the assassination and massacre of an agent, two government expresses, an artillery officer, five citizens, and one hundred and twelve men of Major Dade's command, caused the war--that our troops are not subject to censure for inefficiency--that General Jesup has been wrongfully denounced upon this floor--and that even the expense of the Florida war, resting as it does in figures and in documents, has been vastly overstated to produce effect upon the public mind. All these things I have shown; and I conclude with saying that cost, and time, and loss of men, are all out of the question; that, for outrages so wanton and so horrible as those which occasioned this war, the national honor requires the most ample amends; and the national safety requires a future guarantee in prosecuting this war to a successful close, and completely clearing the peninsula of Florida of all the Indians that are upon it.

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XX. RESUMPTION OF SPECIE PAYMENTS BY THE NEW YORK BANKS

The suspension commenced on the 10th of May in New York, and was followed throughout the country. In August the New York banks proposed to all others to meet in convention, and agree upon a time to commence a general resumption. That movement was frustrated by the opposition of the Philadelphia banks, for the reason, as given, that it was better to await the action of the extra session of Congress, then convoked, and to meet in September. The extra session adjourned early in October, and the New York banks, faithful to the promised resumption of specie payments, immediately issued another invitation for the general convention of the banks in that city on the 27th of November ensuing, to carry into effect the object of the meeting which had been invited in the month of August. The 27th of November arrived; a large proportion of the delinquent banks had accepted the invitation to send delegates to the convention: but its meeting was again frustrated--and from the same quarter--the Bank of the United States, and the institutions under its influence. They then resolved to send a committee to Philadelphia to ascertain from the banks when they would be ready, and to invite them to name a day when they would be able to resume; and if no day was definitely fixed, to inform them that the New York banks would commence specie payments without waiting for their co-operation. The Philadelphia banks would not co-operate. They would not agree to any definite time to take even initiatory steps towards resumption. This was a disappointment to the public mind--that large part of it which still had faith in the Bank of the United States; and the contradiction which it presented to all the previous professions of that institution, required explanations, and, if possible, reconciliation with past declarations. The occasion called for the pen of Mr. Biddle, always ready, always confident, always presenting an easy remedy, and a sure one, for all the diseases to which banks, currency, and finance were heir. It called for another letter to Mr. John Quincy Adams, that is to say, to the public, through the distinction of that gentleman's name. It came--the most elaborate and ingenious of its species; its burden, to prove the entire ability of the bank over which he presided to pay in full, and without reserve, but its intention not to do so on account of its duty to others not able to follow its example, and which might be entirely ruined by a premature effort to do so. And he concluded with condensing his opinion into a sentence of characteristic and sententious brevity: "On the whole, the course which in my judgment the banks ought to pursue, is simply this: The banks should remain exactly as they are--prepared to resume, but not yet resuming." But he did not stop there, but in another publication went the length of a direct threat of destruction against the New York banks if they should, in conformity to their promise, venture to resume, saying: "Let the banks of the Empire State come up from their Elba, and enjoy their hundred days of resumption! a Waterloo awaits them, and a Saint Helena is prepared for them."_

The banks of New York were now thrown upon the necessity of acting without the concurrence of those of Pennsylvania, and in fact under apprehension of opposition and counteraction from that quarter. They were publicly pledged to act without her, and besides were under a legal obligation to do so. The legislature of the State, at the time of the suspension, only legalized it for one year. The indulgence would be out on the 15th of May, and forfeiture of charter was the penalty to be incurred throughout the State for continuing it beyond that time. The city banks had the control of the movement, and they invited a convention of delegates from all the banks in the Union to meet in New York on the 15th of April. One hundred and forty-three delegates, from the principal banks in a majority of the States, attended. Only delegates from fifteen States voted--Pennsylvania, Maryland and South Carolina among the absent; which, as including the three principal commercial cities on the Atlantic board south of New York, was a heavy defalcation from the weight of the convention. Of the fifteen States, thirteen voted for resuming on the 1st day of January, 1839--a delay of near nine months; two voted against that day--New York and Mississippi; and (as it often happens in concurring votes) for reasons directly opposite to each other. The New York banks so voted because the day was too distant--those of Mississippi because it was too near. The New York delegates wished the 15th of May, to avoid the penalty of the State law: those of Mississippi wished the 1st of January, 1840, to allow them to get in two more cotton crops before the great pay-day came. The result of the voting showed the still great power of the Bank of the United States. The delegates of the banks of ten States, including those with which she had most business, either refused to attend the convention, or to vote after having attended. The rest chiefly voted the late day, "to favor the views of Philadelphia and Baltimore rather than those of New York." So said the delegates, "frankly avowing that their interests and sympathies were with the former two rather than with the latter." The banks of the State of New York were then left to act alone--and did so. Simultaneously with the issue of the convention recommendation to resume on the first day of January, 1839, they issued another, recommending all the banks of the State of New York to resume on the 10th day of May, 1838; that is to say, within twenty-five days of that time. Those of the city declared their determination to begin on that day, or earlier, expressing their belief that they had nothing to fear but from the opposition and "deliberate animosity of others"--meaning the Bank of the United States. The New York banks all resumed at the day named. Their example was immediately followed by others, even by the institutions in those States whose delegates had voted for the long day; so that within sixty days thereafter the resumption was almost general, leaving the Bank of the United States uncovered, naked, and prominent at the head of all the delinquent banks in the Union. But her power was still great. Her stock stood at one hundred and twelve dollars to the share, being a premium of twelve dollars on the hundred. In Congress, which was still in session, not a tittle was abated of her pretensions and her assurance--her demands for a recharter--for the repeal of the specie circular--and for the condemnation of the administration, as the author of the misfortunes of the country; of which evils there were none except the bank suspensions, of which she had been the secret prime contriver and was now the detected promoter. Briefly before the New York resumption, Mr. Webster the great advocate of the Bank of the United States, and the truest exponent of her wishes, harangued the Senate in a set speech in her favor, of which some extracts will show the design and spirit:

"And now, sir, we see the upshot of the experiment. We see around us bankrupt corporations and broken promises; but we see no promises more really and emphatically broken than all those promises of the administration which gave us assurance of a better currency. These promises, now broken, notoriously and openly broken, if they cannot be performed, ought, at least, to be acknowledged. The government ought not, in common fairness and common honesty, to deny its own responsibility, seek to escape from the demands of the people, and to hide itself, out of the way and beyond the reach of the process of public opinion, by retreating into this sub-treasury system. Let it, at least, come forth; let it bear a port of honesty and candor; let it confess its promises, if it cannot perform them; and, above all, now, even now, at this late hour, let it renounce schemes and projects, the inventions of presumption, and the resorts of desperation, and let it address itself, in all good faith, to the great work of restoring the currency by approved and constitutional means.

"What say these millions of souls to the sub-treasury? In the first place, what says the city of New York, that great commercial emporium, worthy the gentleman's [Mr. Wright] commendation in 1834, and worthy of his commendation and my commendation, and all commendation, at all times? What sentiments, what opinions, what feelings, are proclaimed by the thousands of merchants, traders, manufacturers, and laborers? What is the united shout of all the voices of all her classes? What is it but that you will put down this new-fangled sub-treasury system, alike alien to their interests and their feelings, at once, and for ever? What is it, but that in mercy to the mercantile interest, the trading interest, the shipping interest, the manufacturing interest, the laboring class, and all classes, you will give up useless and pernicious political schemes and projects, and return to the plain, straight course of wise and wholesome legislation? The sentiments of the city cannot be misunderstood. A thousand pens and ten thousand tongues, and a spirited press, make them all known. If we have not already heard enough, we shall hear more. Embarrassed, vexed, pressed and distressed, as are her citizens at this moment, yet their resolution is not shaken, their spirit is not broken; and, depend upon it, they will not see their commerce, their business, their prosperity and their happiness, all sacrificed to preposterous schemes and political empiricism, without another, and a yet more vigorous struggle.

"Sir, I think there is a revolution in public opinion now going on, whatever may be the opinion of the member from New York, or others. I think the fall elections prove this, and that other more recent events confirm it. I think it is a revolt against the absolute dictation of party, a revolt against coercion on the public judgment; and, especially, against the adoption of new mischievous expedients on questions of deep public interest; a revolt against the rash and unbridled spirit of change; a revolution, in short, against further revolution. I hope, most sincerely, that this revolution may go on; not, sir, for the sake of men, but for the sake of measures, and for the sake of the country. I wish it to proceed, till the whole country, with an imperative unity of voice, shall call back Congress to the true policy of the government.

"I verily believe a majority of the people of the United States are now of the opinion that a national bank, properly constituted, limited, and guarded, is both constitutional and expedient, and ought now to be established. So far as I can learn, three-fourths of the western people are for it. Their representatives here can form a better judgment; but such is my opinion upon the best information which I can obtain. The South may be more divided, or may be against a national institution; but, looking again to the centre, the North and the East, and comprehending the whole in one view, I believe the prevalent sentiment is such as I have stated.

"At the last session great pains were taken to obtain a vote of this and the other House against a bank, for the obvious purpose of placing such an institution out of the list of remedies, and so reconciling the people to the sub-treasury scheme. Well, sir, and did those votes produce any effect? None at all. The people did not, and do not, care a rush for them. I never have seen, or heard, a single man, who paid the slightest respect to those votes of ours. The honorable member, to-day, opposed as he is to a bank, has not even alluded to them. So entirely vain is it, sir, in this country, to attempt to forestall, commit, or coerce the public judgment. All those resolutions fell perfectly dead on the tables of the two Houses. We may resolve what we please, and resolve it when we please; but if the people do not like it, at their own good pleasure they will rescind it; and they are not likely to continue their approbation long to any system of measures, however plausible, which terminates in deep disappointment of all their hopes, for their own prosperity."

All the friends of the Bank of the United States came to her assistance in this last trial. The two halls of Congress resounded with her eulogium, and with condemnation of the measures of the administration. It was a last effort to save her, and to force her upon the federal government. Multitudes of speakers on one side brought out numbers on the other--among those on the side of the sub-treasury and hard money, and against the whole paper system, of which he considered a national bank the citadel, was the writer of this View, who undertook to collect into a speech, from history and experience, the facts and reasons which would bear upon the contest, and act upon the judgment of candid men, and show the country to be independent of banks, if it would only will it. Some extracts from that speech make the next chapter.

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Chapter XXI

RESUMPTION OF SPECIE PAYMENTS: HISTORICAL NOTICES: MR. BENTON'S SPEECH: EXTRACTS.

There are two of those periods, each marking the termination of a national bank charter, and each presenting us with the actual results of the operations of those institutions upon the general currency, and each replete with lessons of instruction applicable to the present day, and to the present state of things. The first of these periods is the year 1811, when the first national bank had run its career of twenty years, and was permitted by Congress to expire upon its own limitation. I take for my guide the estimate of Mr. Lloyd, then a senator in Congress from the State of Massachusetts, whose dignity of character and amenity of manners is so pleasingly remembered by those who served with him here, and whose intelligence and accuracy entitle his statements to the highest degree of credit. That eminent senator estimated the total currency of the country, at the expiration of the charter of the first national bank, at sixty millions of dollars, to wit: ten millions of specie, and fifty millions in bank notes. Now compare the two quantities, and mark the results. Our population has precisely doubled itself since 1811. The increase of our currency should, therefore, upon the same principle of increase, be the double of what it then was; yet it is three times as great as it then was! The next period which challenges our attention is the veto session of 1832, when the second Bank of the United States, according to the opinion of its eulogists, had carried the currency to the ultimate point of perfection. What was the amount then? According to the estimate of a senator from Massachusetts, then and now a member of this body [Mr. WEBSTER], then a member of the Finance Committee, and with every access to the best information, the whole amount of currency was then estimated at about one hundred millions; to wit: twenty millions in specie, and seventy-five to eighty millions in bank notes. The increase of our population since that time is estimated at twenty per cent.; so that the increase of our currency, upon the basis of increased population, should also be twenty per cent. This would give an increase of twenty millions of dollars, making, in the whole, one hundred and twenty millions. Thus, our currency in actual existence, is nearly one-third more than either the ratio of 1811 or of 1832 would give. Thus, we have actually about fifty millions more, in this season of ruin and destitution, than we should have, if supplied only in the ratio of what we possessed at the two periods of what is celebrated as the best condition of the currency, and most prosperous condition of the country. So much for quantity; now for the solidity of the currency at these respective periods. How stands the question of solidity? Sir, it stands thus: in 1811, five paper dollars to one of silver; in 1822, four to one; in 1838, one to one, as near as can be! Thus, the comparative solidity of the currency is infinitely preferable to what it ever was before; for the increase, under the sagacious policy of General Jackson, has taken place precisely where it was needed--at the bottom, and not at the top; at the foundation, and not in the roof; at the base, and not at the apex. Our paper currency has increased but little; we may say nothing, upon the bases of 1811 and 1832; our specie has increased immeasurably; no less than eight-fold, since 1811, and four-fold since 1832. The whole increase is specie; and of that we have seventy millions more than in 1811, and sixty millions more than in 1832. Such are the fruits of General Jackson's policy! a policy which we only have to persevere in for a few years, to have our country as amply supplied with gold and silver as France and Holland are; that France and Holland in which gold is borrowed at three per cent. per annum, while we often borrow paper money at three per cent. a month.

But there is no specie. Not a ninepence to be got for a servant; not a picayune for a beggar; not a ten cent piece for the post-office. Such is the assertion; but how far is it true? Go to the banks, and present their notes at their counter, and it is all too true. No gold, no silver, no copper to be had there in redemption of their solemn promises to pay. Metaphorically, if not literally speaking, a demand for specie at the counter of a bank might bring to the unfortunate applicant more kicks than coppers. But change the direction of the demand; go to the brokers; present the bank note there; no sooner said than done; gold and silver spring forth in any quantity; the notes are cashed; you are thanked for your custom, invited to return again; and thus, the counter of the broker, and not the counter of the bank, becomes the place for the redemption of the notes of the bank. The only part of the transaction that remains to be told, is the per centum which is shaved off! And, whoever will submit to that shaving, can have all the bank notes cashed which he can carry to them. Yes, Mr. President, the brokers, and not the bankers, now redeem the bank notes. There is no dearth of specie for that purpose. They have enough to cash all the notes of the banks, and all the treasury notes of the government into the bargain. Look at their placards! not a village, not a city, not a town in the Union, in which the sign-boards do not salute the eye of the passenger, inviting him to come in and exchange his bank notes, and treasury notes, for gold and silver. And why cannot the banks redeem, as well as the brokers? Why can they not redeem their own notes? Because a veto has issued from the city of Philadelphia, and because a political revolution is to be effected by injuring the country, and then charging the injury upon the folly and wickedness of the republican administrations. This is the reason, and the sole reason. The Bank of the United States, its affiliated institutions, and its political confederates, are the sole obstacles to the resumption of specie payments. They alone prevent the resumption. It is they who are now in terror lest the resumption shall begin and to prevent it, we hear the real shout, and feel the real application of the rallying cry, so pathetically uttered on this floor by the senator from Massachusetts [Mr. WEBSTER]--once more to the breach, dear friends, once more!

Yes, Mr. President, the cause of the non-resumption of specie payments is now plain and undeniable. It is as plain as the sun at high noon, in a clear sky. No two opinions can differ about it, how much tongues may differ. The cause of not resuming is known, and the cause of suspension will soon be known likewise. Gentlemen of the opposition charge the suspension upon the folly, the wickedness, the insanity, the misrule, and misgovernment of the outlandish administration, as they classically call it; expressions which apply to the people who created the administration which have been so much vilified, and who have sanctioned their policy by repeated elections. The opposition charge the suspension to them--to their policy--to their acts--to the veto of 1832--the removal of the deposits of 1833--the Treasury order of 1836--and the demand for specie for the federal Treasury. This is the charge of the politicians, and of all who follow the lead, and obey the impulsion of the denationalized Bank of the United States. But what say others whose voice should be potential, and even omnipotent, on this question? What say the New York city banks, where the suspension began, and whose example was alleged for the sole cause of suspension by all the rest? What say these banks, whose position is at the fountain-head of knowledge, and whose answer for themselves is an answer for all. What say they? Listen, and you shall hear! for I hold in my hand a report of a committee of these banks, made under an official injunction, by their highest officers, and deliberately approved by all the city institutions. It is signed by Messrs. Albert Gallatin, George Newbold, C. C. Lawrence, C. Heyer, J. J. Palmer, Preserved Fish, and G. A. Worth,--seven gentlemen of known and established character; and not more than one out of the seven politically friendly to the late and present administrations of the federal government. This is their report:

"The immediate causes which thus compelled the banks of the city of New York to suspend specie payments on the 10th of May last, are well known. The simultaneous withdrawing of the large public deposits, and of excessive foreign credits, combined with the great and unexpected fall in the price of the principal article of our exports, with an import of corn and bread stuffs, such as had never before occurred, and with the consequent inability of the country, particularly in the south-western States, to make the usual and expected remittances, did, at one and the same time, fall principally and necessarily, on the greatest commercial emporium of the Union. After a long and most arduous struggle, during which the banks, though not altogether unsuccessfully, resisting the imperative foreign demand for the precious metals, were gradually deprived of a great portion of their specie; some unfortunate incidents of a local nature, operating in concert with other previous exciting causes, produced distrust and panic, and finally one of those general runs, which, if continued, no banks that issue paper money, payable on demand, can ever resist; and which soon put it out of the power of those of this city to sustain specie payments. The example was followed by the banks throughout the whole country, with as much rapidity as the news of the suspension in New York reached them, without waiting for an actual run; and principally, if not exclusively, on the alleged grounds of the effects to be apprehended from that suspension. Thus, whilst the New York city banks were almost drained of their specie, those in other places preserved the amount which they held before the final catastrophe."

These are the reasons! and what becomes now of the Philadelphia cry, re-echoed by politicians and subaltern banks, against the ruinous measures of the administration? Not a measure of the administration mentioned! not one alluded to! Not a word about the Treasury order; not a word about the veto of the National Bank charter; not a word about the removal of the deposits from the Bank of the United States; not a word about, the specie policy of the administration! Not one word about any act of the government, except that distribution act, disguised as a deposit law, which was a measure of Congress, and not of the administration, and the work of the opponents, and not the friends of the administration, and which encountered its only opposition in the ranks of those friends. I opposed it, with some half dozen others; and among my grounds of opposition, one was, that it would endanger the deposit banks, especially the New York city deposit banks,--that it would reduce them to the alternative of choosing between breaking their customers, and being broken themselves. This was the origin of that act--the work of the opposition on this floor; and now we find that very act to be the cause which is put at the head of all the causes which led to the suspension of specie payments. Thus, the administration is absolved. Truth has performed its office. A false accusation is rebuked and silenced. Censure falls where it is due; and the authors of the mischief stand exposed in the double malefaction of having done the mischief, and then charged it upon the heads of the innocent.

But, gentlemen of the opposition say, there can be no resumption until Congress "acts upon the currency." Until Congress acts upon the currency! that is the phrase! and it comes from Philadelphia; and the translation of it is, that there shall be no resumption until Congress submits to Mr. Biddle's bank, and recharters that institution. This is the language from Philadelphia, and the meaning of the language; but, happily, a different voice issues from the city of New York! The authentic notification is issued from the banks of that city, pledging themselves to resume by the 10th day of May. They declare their ability to resume, and to continue specie payments; and declare they have nothing to fear, except from "deliberate hostility"--an hostility for which they allege there can be no motive--but of which they delicately intimate there is danger. Philadelphia is distinctly unveiled as the seat of this danger. The resuming banks fear hostility--deliberate acts of hostility--from that quarter. They fear nothing from the hostility, or folly, or wickedness of this administration. They fear nothing from the Sub-Treasury bill. They fear Mr. Biddle's bank, and nothing else but his bank, with its confederates and subalterns. They mean to resume, and Mr. Biddle means that they shall not. Henceforth two flags will be seen, hoisted from two great cities. The New York flag will have the word resumption inscribed upon it; the Philadelphia flag will bear the inscription of non-resumption, and destruction to all resuming banks.

I have carefully observed the conduct of the leading banks in the United States. The New York banks, and the principal deposit banks, had a cause for stopping which no others can plead, or did plead. I announced that cause, not once, but many times, on this floor; not only during the passage of the distribution law, but during the discussion of those famous land bills, which passed this chamber; and one of which ordered a peremptory distribution of sixty-four millions, by not only taking what was in the Treasury, but by reaching back, and taking all the proceeds of the land sales for years preceding. I then declared in my place, and that repeatedly, that the banks, having lent this money under our instigation, if called upon to reimburse it in this manner, must be reduced to the alternative of breaking their customers, or of being broken themselves. When the New York banks stopped, I made great allowances for them, but I could not justify others for the rapidity with which they followed their example; and still less can I justify them for their tardiness in following the example of the same banks in resuming. Now that the New York banks have come forward to redeem their obligations, and have shown that sensibility to their own honor, and that regard for the punctual performance of their promises, which once formed the pride and glory of the merchant's and the banker's character, I feel the deepest anxiety for their success in the great contest which is to ensue. Their enemy is a cunning and a powerful one, and as wicked and unscrupulous as it is cunning and strong. Twelve years ago, the president of that bank which now forbids other banks to resume, declared in an official communication to the Finance Committee of this body, "that there were but few State banks which the Bank of the United States could not DESTROY by an exertion of its POWER." Since that time it has become more powerful; and, besides its political strength, and its allied institutions, and its exhaustless mine of resurrection notes, it is computed by its friends to wield a power of one hundred and fifty millions of dollars! all at the beck and nod of one single man! for his automaton directors are not even thought of! The wielding of this immense power, and its fatal direction to the destruction of the resuming banks, presents the prospect of a fearful conflict ahead. Many of the local banks will doubtless perish in it; many individuals will be ruined; much mischief will be done to the commerce and to the business of different places; and all the destruction that is accomplished will be charged upon some act of the administration--no matter what--for whatever is given out from the Philadelphia head is incontinently repeated by all the obsequious followers, until the signal is given to open upon some new cry.

Sir, the honest commercial banks have resumed, or mean to resume. They have resumed, not upon the fictitious and delusive credit of legislative enactments, but upon the solid basis of gold and silver. The hundred millions of specie which we have accumulated in the country has done the business. To that hundred millions the country is indebted for this early, easy, proud and glorious resumption!--and here let us do justice to the men of this day--to the policy of General Jackson--and to the success of the experiments--to which we are indebted for these one hundred millions. Let us contrast the events and effects of the stoppages in 1814, and in 1819, with the events and effects of the stoppage in 1837, and let us see the difference between them, and the causes of that difference. The stoppage of 1814 compelled the government to use depreciated bank notes during the remainder of the war, and up to the year 1817. Treasury notes, even bearing a large interest, were depreciated ten, twenty, thirty per cent. Bank notes were at an equal depreciation. The losses to the government from depreciated paper in loans alone, during the war, were computed by a committee of the House of Representatives at eighty millions of dollars. Individuals suffered in the same proportion; and every transaction of life bore the impress of the general calamity. Specie was not to be had. There was, nationally speaking, none in the country. The specie standard was gone; the measure of values was lost; a fluctuating paper money, ruinously depreciated, was the medium of all exchanges. To extricate itself from this deplorable condition, the expedient of a National Bank was resorted to--that measure of so much humiliation, and of so much misfortune to the republican party. For the moment it seemed to give relief, and to restore national prosperity; but treacherous and delusive was the seeming boon. The banks resumed--relapsed--and every evil of the previous suspension returned upon the country with increased and aggravated force.

Politicians alone have taken up this matter and have proposed, for the first time since the foundation of the government--for the first time in 48 years--to compel the government to receive paper money for its dues. The pretext is, to aid the banks in resuming! This, indeed, is a marvellous pretty conception! Aid the banks to resume! Why, sir, we cannot prevent them from resuming. Every solvent, commercial bank in the United States either has resumed, or has declared its determination to do so in the course of the year. The insolvent, and the political banks, which did not mean to resume, will have to follow the New York example, or die! Mr. Biddle's bank must follow the New York lead, or die! The good banks are with the country: the rest we defy. The political banks may resume or not, as they please, or as they dare. If they do not, they die! Public opinion, and the laws of the land, will exterminate them. If the president of the miscalled Bank of the United States has made a mistake in recommending indefinite non-resumption, and in proposing to establish a confederation of broken banks, and has found out his mistake, and wants a pretext for retreating, let him invent one. There is no difficulty in the case. Any thing that the government does, or does not--any thing that has happened, will happen, or can happen--will answer the purpose. Let the president of the Bank of the United States give out a tune: incontinently it will be sung by every bank man in the United States; and no matter how ridiculous the ditty may be, it will be celebrated as superhuman music.

But an enemy lies in wait for them! one that foretells their destruction, is able to destroy them, and which looks for its own success in their ruin. The report of the committee of the New York banks expressly refers to "acts of deliberate hostility" from a neighboring institution as a danger which the resuming banks might have to dread. The reference was plain to the miscalled Bank of the United States as the source of this danger. Since that time an insolent and daring threat has issued from Philadelphia, bearing the marks of its bank paternity, openly threatening the resuming banks of New York with destruction. This is the threat: "Let the banks of the Empire State come up from their Elba, and enjoy their hundred days of resumption; a Waterloo awaits them, and a St. Helena is prepared for them." Here is a direct menace, and coming from a source which is able to make good what it threatens. Without hostile attacks, the resuming banks have a perilous process to go through. The business of resumption is always critical. It is a case of impaired credit, and a slight circumstance may excite a panic which may be fatal to the whole. The public having seen them stop payment, can readily believe in the mortality of their nature, and that another stoppage is as easy as the former. On the slightest alarm--on the stoppage of a few inconsiderable banks, or on the noise of a groundless rumor--a general panic may break out. Sauve qui peut--save himself who can--becomes the cry with the public; and almost every bank may be run down. So it was in England after the long suspension there from 1797 to 1823; so it was in the United States after the suspension from 1814 to 1817; in each country a second stoppage ensued in two years after resumption; and these second stoppages are like relapses to an individual after a spell of sickness: the relapse is more easily brought on than the original disease, and is far more dangerous.

The banks in England suspended in 1797--they broke in 1825; in the United States it was a suspension during the war, and a breaking in 1819-20. So it may be again with us. There is imminent danger to the resuming banks, without the pressure of premeditated hostility; but, with that hostility, their prostration is almost certain. The Bank of the United States can crush hundreds on any day that it pleases. It can send out its agents into every State of the Union, with sealed orders to be opened on a given day, like captains sent into different seas; and can break hundreds of local banks within the same hour, and over an extent of thousands of miles. It can do this with perfect ease--the more easily with resurrection notes--and thus excite a universal panic, crush the resuming banks, and then charge the whole upon the government. This is what it can do; this is what it has threatened; and stupid is the bank, and doomed to destruction, that does not look out for the danger, and fortify against it. In addition to all these dangers, the senator from Kentucky, the author of the resolution himself, tells you that these banks must fail again! he tells you they will fail! and in the very same moment he presses the compulsory reception of all the notes on all these banks upon the federal treasury! What is this but a proposition to ruin the finances--to bankrupt the Treasury--to disgrace the administration--to demonstrate the incapacity of the State banks to serve as the fiscal agents of the government, and to gain a new argument for the creation of a national bank, and the elevation of the bank party to power? This is the clear inference from the proposition; and viewing it in this light, I feel it to be my duty to expose, and to repel it, as a proposition to inflict mischief and disgrace upon the country.

But to return to the point, the contrast between the effects and events of former bank stoppages, and the effects and events of the present one. The effects of the former were to sink the price of labor and of property to the lowest point, to fill the States with stop laws, relief laws, property laws, and tender laws; to ruin nearly all debtors, and to make property change hands at fatal rates; to compel the federal government to witness the heavy depreciation of its treasury notes, to receive its revenues in depreciated paper; and, finally, to submit to the establishment of a national bank as the means of getting it out of its deplorable condition--that bank, the establishment of which was followed by the seven years of the greatest calamity which ever afflicted the country; and from which calamity we then had to seek relief from the tariff, and not from more banks. How different the events of the present time! The banks stopped in May, 1837; they resume in May, 1838. Their paper depreciated but little; property, except in a few places, was but slightly affected; the price of produce continued good; people paid their debts without sacrifices; treasury notes, in defiance of political and moneyed combinations to depress them, kept at or near par; in many places above it; the government was never brought to receive its revenues in depreciated paper; and finally all good banks are resuming in the brief space of a year; and no national bank has been created. Such is the contrast between the two periods; and now, sir, what is all this owing to? what is the cause of this great difference in two similar periods of bank stoppages? It is owing to our gold bill of 1834, by which we corrected the erroneous standard of gold, and which is now giving us an avalanche of that metal; it is owing to our silver bill of the same year, by which we repealed the disastrous act of 1819, against the circulation of foreign silver, and which is now spreading the Mexican dollars all over the country; it is owing to our movements against small notes under twenty dollars; to our branch mints, and the increased activity of the mother mint; to our determination to revive the currency of the constitution, and to our determination not to fall back upon the local paper currencies of the States for a national currency. It was owing to these measures that we have passed through this bank stoppage in a style so different from what has been done heretofore. It is owing to our "experiments" on the currency--to our "humbug" of a gold and silver currency--to our "tampering" with the monetary system--it is owing to these that we have had this signal success in this last stoppage, and are now victorious over all the prophets of woe, and over all the architects of mischief. These experiments, this humbugging, and this tampering, has increased our specie in six years from twenty millions to one hundred millions; and it is these one hundred millions of gold and silver which have sustained the country and the government under the shock of the stoppage--has enabled the honest solvent banks to resume, and will leave the insolvent and political banks without excuse or justification for not resuming. Our experiments--I love the word, and am sorry that gentlemen of the opposition have ceased to repeat it--have brought an avalanche of gold and silver into the country; it is saturating us with the precious metals, it has relieved and sustained the country; and now when these experiments have been successful--have triumphed over all opposition--gentlemen cease their ridicule, and go to work with their paper-money resolutions to force the government to use paper, and thereby to drive off the gold and silver which our policy has brought into the country, destroy the specie basis of the banks, give us an exclusive paper currency again, and produce a new expansion and a new explosion.

Justice to the men of this day requires these things to be stated. They have avoided the errors of 1811. They have avoided the pit into which they saw their predecessors fall. Those who prevented the renewal of the bank charter in 1811, did nothing else but prevent its renewal; they provided no substitute for the notes of the bank; did nothing to restore the currency of the constitution; nothing to revive the gold currency; nothing to increase the specie of the country. They fell back upon the exclusive use of local bank notes, without even doing any thing to strengthen the local banks, by discarding their paper under twenty dollars. They fell back upon the local banks; and the consequence was, the total prostration, the utter helplessness, the deplorable inability of the government to take care of itself, or to relieve and restore the country, when the banks failed. Those who prevented the recharter of the second Bank of the United States had seen all this; and they determined to avoid such error and calamity. They set out to revive the national gold currency, to increase the silver currency, and to reform and strengthen the banking system. They set out to do these things; and they have done them. Against a powerful combined political and moneyed confederation, they have succeeded; and the one hundred millions of gold and silver now in the country attests the greatness of their victory, and insures the prosperity of the country against the machinations of the wicked and the factious.

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