I 
 
 i 
 
 
LEGISLATIVE 
 
 AND 
 
 DOCUMENTARY HISTORY 
 
 OF THE 
 
 BANK OF THE UNITED STATES: 
 
 INCLUDING THE ORIGINAL 
 
 BANK OF NORTH AMERICA 
 
 
 
 
 COMPILED 
 
 BY M. ST. CLAIR CLARKE & D. A. HALL, 
 
 WASHINGTON: 
 
 PRINTED BY GALES AND SEATON. 
 
 1832. 
 
* JS-* %. 
 
 X ^ 
 
 
PREFACE. 
 
 THE Editors present to the public the following pages, 
 with the hope that they may impart useful knowledge in 
 regard to the past legislation of Congress, upon the highly 
 important subject of which they treat. It has been their 
 design to collect and embody, in as brief compass as pos- 
 sible, the entire proceedings, debates, and resolutions, of 
 Congress, upon the various bills and projects for a National 
 Bank, which, at any time during the existence of the Fe- 
 deral Government, have been brought forward or discussed. 
 In their proper connexion, they have also embraced such 
 reports of committees and public officers, as had relation 
 to the establishment, constitutionality, or public uses of a 
 bank. The Debates, which form the great body of the 
 collection, will be found to contain the opinions and ela- 
 borate arguments of the most distinguished men of our 
 country, both for, and against, the establishment of such 
 an institution. For current reference, or preservation of 
 speeches, in convenient form, this part of the work is cal- 
 culated to be permanently useful. In the statement of the 
 decision of important questions, the journals of Congress 
 have, as far as possible, been relied on; it will occur, how- 
 ever, to those familiar with the proceedings of Congress, 
 that very much of the action of that body, on all bills of 
 public interest, finds no place in their daily record. All 
 proceedings in Committee of the Whole are excluded from 
 the journals of the House; and, if they become matter of 
 record at all, it is in the pages of the gazettes of the day. 
 
PREFACE. 
 
 For the history of the proceedings and the debates in Com- 
 mittee of the Whole, the files of the National Intelligencer 
 have been consulted: these furnish, during a considerable 
 period of our legislative history, the most correct sources 
 of information. It has been a leading object with the 
 editors, to collect with accuracy, and state with fidelity, 
 the acts that have been done, and the opinions which have 
 been uttered in Congress, and the Executive Departments, 
 on the establishment and perpetuation of a National Bank. 
 Errors and unimportant omissions may, perhaps, be de- 
 tected; but none, it is hoped, which can detract from the 
 merit, which the editors claim, of general accuracy. 
 
CONTENTS 
 
 CHAPTER I. 
 
 The institution of the Bank of North America, page 9: Proposition in the 
 old Congress, for a bank, 10: Resolution in favor of establishing a bank, ibid: 
 Ayes and noes on resolution, 11: Plan of the bank, ibid: Ordinance incorpo- 
 rating Bank of North America, 12. 
 
 CHAPTER II. 
 
 Bank of the United States projected Hamilton's report, 15: Hamilton's 
 plan of bank, 31: Bill introduced into Senate proceedings thereon, 35: Be- 
 rn the House, on the bill, 3784: Vote on the passage of the bill, 85: 
 ii of Edmund Randolph, attorney general, given to the President, 
 again uonality of the bill, 86 89: Of Thomas Jefferson, Secre- 
 
 tary of State, on the same subject, 91: Of Alexander Hamilton, Secretary of 
 the Treasury, in favor of the bill, 95: Supplementary acts, 114. 
 
 CHAPTER III. 
 
 Memorials presented for the renewal of the charter of bank, 115: Gallatin's 
 
 1S09, 116: Dividends of old bank, 120: Bill to establish a 
 
 lai Bank, reported by Mr. Love/from select committee, 122: Bill to re- 
 
 sie old charter, reported by Mr. Taylor, of S. C., 133: Bill for the same 
 
 purpose, reported 4th of January, 1811, by Mr. Burwell, 137: Debates in the 
 
 Hous jill, 139 299: Ayes and noes on postponement of bill, 274: 
 
 Menu ^nate for renewal bill reported letter of Mr. Gallatin, 300:* 
 
 Debates in Senate on bill to renew charter, 302 446: Bill rejected, by the 
 
 casting vote of Vice President, 446: Debate in House, on Mr. Taylor's bill, 
 
 449 171. 
 
 CHAPTER IV. 
 
 Various propositions for the establishment of a National Bank, and pro- 
 ceedings thereon, 472480: Letter of Secretary Dallas, to Committee of 
 Ways and Means, on a bank 481: Mr. Fisk, of N. Y. reports a bill, 487: 
 Proceedings and debates thereon, 488518: Same bill, as amended, 519: 
 Bill rejected ayes and noes, 534: Secretary Dallas to Mr. Lowndes, 535: 
 Bill reported in Senate, by Mr. King, 539: Passed, ayes and noes, 549: Re- 
 ported to the House, with amendments, and debated, 549559: Ordered to 
 a third reading, 560: Recommitted, 561: Again ordered to a third reading, 
 562: Mr. Webster's motion to recommit, and speech, 562-3: Bill rejected, 
 by casting vote of Speaker, 571: Vote reconsidered, 574: Passed the House, 
 579: Amendments in House and Senate, 580585: Bill as it passed both 
 
vi CONTENTS. 
 
 Houses, 585: President's ve/o, 594: Bill reported in Senate, by Mr. Barbour, 
 596: Passed the Senate, 605: Indefinitely postponed in the House, 13th Feb- 
 ruary, 1815, 608. 
 
 CHAPTER V. 
 
 On the grant of the charier of 1816 Mr. Madison, on the defects of the 
 currency, 609: Mr. Dallas proposes a bank to remedy these defects, 612: 
 His letter on currency, and a bank, 613 619: Bill reported by Mr. Calhoun, 
 621: Mr. Calhoun's speech on bill, 630: Mr. Sergeant moves to reduce capi- 
 tal of bank, 635: Mr. Smith's speech on said motion, 636: Messrs. Sergeant, 
 Randolph, Ward, and Tucker, of Virginia, speak on the motion, 640 646: 
 Further debates on motion, by Mr. Webster, Mr. Cuthbert, Mr. Hopkinson, 
 Mr. Sharp, and Mr. Calhoun, 646 653: Motion overruled, 653: Motion to 
 dispense with Government subscription of seven millions, and debate on said 
 motion, 653 658: On the appointment of five directors by the Government 
 debate in committee thereon, 661 666: Same in the House, with vote, 678 
 679: Speech of Mr. Clay, 669: Yarious amendments proposed, 672676: 
 Motion to locate bank at New York, carried, 676: This vote reversed, 677: 
 Bill ordered to be engrossed, 680: Passed the House, 681: Considered ajf 
 debated in the Senate, 683692: Speech of Mr. Wells, 694: Passed the/Se- 
 nate, with amendments, 706: Amendments considered in the House, 707 
 712: Agreed to, 713: Bill approved by the President, 713. 
 
 CHAPTER VI. 
 
 Certain proceedings after the bank went into operation Mr. Spencer's re- 
 solution for appointing a committee to inspect hank books, &c., 714: Com- 
 mittee appointed their report, 714732: Mr. Trimble's motion for a scire 
 facias, 732: Mr. Spencer's resolutions for withdrawing Government depo- 
 sites, for scire facias, &c. 732: Mr. Johnson's resolution for a repeal of the 
 charter, 734: President Jackson's suggestions in regard to the bank, 734: 
 Mr. McDuffie's reportin 1830, 735: Mr. Smith's report in Senate, 773: Let- 
 ters of Mr. Madison, in 1831, to C. J- Ingersoll, 778: Judicial decisioi 
 bank charter, 781: Justice Marshall's opinion, 782. 
 
LEGISLATIVE 
 
 ........ .j**e, 
 
 AXD 
 
 DOCUMENTARY HISTORY 
 
 I \\ITED STATES BANK, 
 
 CHAPTER T. 
 
 BANK OF NORTH AMKWCA: 
 PROC'FEDIXOS IX CONGRESS OX ITS ORIGINAL INSTITUTION. 
 
 IN tracing the history of the Bank of the Tinted States, it seems proper 
 
 logive some account of that moneyed institution, which, deriving its incipient 
 
 '3 from the General Govcrninc-iit, may l.c considered as the prototype 
 
 of the corporations which have more recently borne that name. The Bank of 
 
 , which was the precursor of that of the United States, was 
 
 incorporated in 1781, by an ordinance of the American Congress. Its 
 
 dependence, however, upon this creating power, was of short continuance: 
 
 year, it accepted of a charter from the State of Pennsylvania, 
 
 ace been content to derive its powers from that source. All that is 
 
 . in relation to it, is to give the proceedings of Congress, on its 
 
 i;il institution, from the first introduction of the plan of the bank, to its 
 
 tinal consummation, in the grant of the ordinance; and these are given in the 
 
 r ot their dates, and chiefly in the words of the Journals of Congre&s, 
 
 from which they are taken. 
 
 oceedings on the enactment of this ordinance, together with those 
 in the subsequent chapters, will place the reader in possession of the en- 
 gislation of Congress, both before and since the adoption of the consti- 
 . upon the subject of a bank. 
 
 Proposition for the establishment of a Bank. 
 
 IN CONGRESS, June 21, 1780. 
 
 A letter of this day, from the Board of War, was read, informing "that a 
 number of patriotic persons, having formed a plan for the establishment of a 
 bank, whose object is the public service; that the directors have applied to 
 that Board, to represent to Congress the desire of the company that a com- 
 mitttee of this body maybe appointed to confer with the inspectors and direc- 
 tors on the subject, to-morrow morning:" Whereupon, 
 
 Ordered, That a committee of three be appointed, for the purpose above 
 mentioned. The members chosen were, Mr. Ellsworth, Mr. Duane, and Mr. 
 Scott. 
 
 2 
 
10 BANK OF NORTH AMERICA. 
 
 JUNE 22, 1780. 
 
 The committee appointed to confer with the inspectors and directors of the 
 proposed bank, brought in a report, which was read. 
 
 The committee also laid before Congress, the plan of the bank, communi- 
 cated to them at the said conference, which being read, Congress, thereupon, 
 came to the following resolutions: 
 
 Whereas a number of the patriotic citizens of Pennsylvania have com- 
 municated to Congress a liberal offer, on their own credit, and by their own 
 exertions, to supply and transport three millions of rations, and 300 hogsheads 
 of runij for the use of the army, and have established a bank, for the sole pur- 
 pose of obtaining and transporting the said supplies, with the greater facility 
 and despatch: And whereas, on the one hand, the associators, animated to 
 this laudable exertion by a desire to relieve the public necessities, mean not 
 to derive from it the least pecuniary advantage; so, on the other, it is just and 
 reasonable, that they should be fully reimbursed and indemnified: Therefore, 
 
 Resolved, unanimously, That Congress entertain a high sense of the liberal 
 offer of the said associators to raise and transport the beforementioned sup- 
 plies for the army, and do accept the same as a distinguished proof of their 
 patriotism. 
 
 Resolved, That the faith of the United States be, and the same hereby is, 
 pledged, to the subscribers to the said bank, for their effectual reimburse- 
 ment in the premises. 
 
 Resolved, That the Board of Treasury be directed to deposite, in the said 
 bank, bills of exchange in favor of the directors thereof, on the ministers of 
 these United States in Europe, or any of them, and in such sums as shall be 
 thought convenient, but not to exceed, in the whole, 150,000 sterling; that 
 the said bills are to be considered, not only as a support of the credit of the said 
 bank, but as an indemnity to the subscribers for all defi ciences of losses and ex- 
 penses which they may sustain, on account of their said engagements, and which 
 shall not, within six months from the date hereof, be made good to them out of 
 the public treasury; and, in case of failure, such a proportion of said bills as 
 shall be requisite to make good the deficiency ,.shall be negotiated for that pur- 
 pose, by the said directors, and the residue returned into the treasury. 
 
 Resolved* That, upon representation made, that the bank stands in need of 
 occasional assistance, Congress will advance as much of their current money 
 as can be spared from other services. 
 
 Resolved, That a standing committee of Congress be appointed, to confer 
 with the officers of the said bank, as occasion may require. The.members 
 chosen are Mr. Ellsworth, Mr. Duane, and Mr. Scott. 
 
 JUNE 23, 1780. 
 
 Ordered, That two members be added to the committee appointed to con- 
 fer with the directors and inspectors of the proposed bank, in the room of 
 Mr. Duane and Mr. Ellsworth, who are absent. The members chosen are 
 Mr. Livingston and Mr. Adams. 
 
 Whether the preceding proposition and resolutions had any immediate 
 connexion with the plan that was subsequently submitted, as hereafter exhi- 
 bited, by Robert Morris, and adopted by Congress, does not appear. 
 
 Proceedings on the incorporation of the Bank of North America. 
 
 MAY 26, 1781. 
 
 On the report of a committee, consisting of Messrs. Witherspoon, Sulli- 
 van, M. Smith, and Clymer, to whom was referred a letter from Mr. R. Mor- 
 ris, with the plan of a bank: 
 
 Resolved, That Congress do approve of the plan for establishing a national 
 bank, in these United States, submitted to their consideration by R. Morns, 
 on the 17th May, 1781, and that they will promote and support the same, by 
 
CHARTERED BY CONGRESS. JJ 
 
 such ways and means, from time to time, as may appear necessary for the in- 
 stitution, and consistent with the public good. 
 
 That the subscribers to the said bank shall be incorporated agreeably to the 
 principles and terms of the plan, und-cr the name of the 4 * President, Directors, 
 and Company of the Bank of North America," so soon as the subscription 
 shall be filled, the directors and president chosen, and application for that 
 purpose made to Congress, by the president and directors elected. 
 
 On the question to agree to this paragraph, the yeas and nays being re- 
 quired by Mr. T. Smith, were as follows: 
 
 New Hampshire, . . . . Mr. Sullivan, ay. 7 
 
 Livermore, ay. 5 ' 
 MattachutctUt .... Mr. Lovell, n . ? no 
 
 Ward, no. 5 
 
 Rhode Island, Mr. Varnum, ay. 
 
 Connecticut, - - Mr. Huntington, ay. 
 
 New Jersey, Mr. Witherspoon, ay. ? a 
 
 Houston, av. 5 
 
 Pennsylmtoto, Mr. Clymer, ay. I divided 
 
 T. Smitl), no. ^ 
 
 Maryland, Mr. Jenifer, ay.-) 
 
 Carroll, *Z'\ 
 
 Virginia, . Mr. Jones, ay.-T 
 
 Madison, no. I av 
 
 Bland, ay. f y ' 
 
 M. Smith, ay. I 
 .\nrth Carolina, Mr. Sharp, a y. 7 
 
 Johnson, ay. v &y * 
 
 South ('(irnhiHi, Mr. Matthews, ay.-) 
 
 Bee, ay.ay- 
 
 Motte, ay. \ 
 
 Mr. Walton, a.* 
 
 Howly, av. S 
 
 So it was roolvcd in the affirmative. 
 
 Resolved, Thai it be recommended to the several States, by proper laws 
 for that purpose, to provide that no other bank or bankers shall be established 
 or permitted within the said States, respectively, during the war. 
 
 fasolvcd, That the notes hereafter to be issued by the said bank, payable 
 on demand, shall Irc receivable in payment of all taxes, duties, and debts, due, 
 or that may become due or payable to the United States, 
 
 Resvlved, That Congress will recommend to the several Legislatures to 
 
 laws making it ielony, without benefit of clergy, for any person to 
 
 counterfeit bank notes, or to pass such notes, knowing them to be counter- 
 
 : also, making it felony, without benefit of clergy, for any president, in- 
 
 spector, director, officer, or servant of the bank, to convert any of the pro- 
 
 perty, money, or credit, of the said bank, to his own use, or in any other way 
 
 bank 1 r embexzlemcnt > as an offic er or servant of the said 
 
 The plan of the bank above referred to is as follows: 
 
 1st. That a subscription be opened for 400,000 dollars, in shares of 400 dol- 
 lars each, to be paid in gold or silver. 
 
 T ~ d - ^ hat th 6 subscription te paid into the hands of George Clymer and 
 John Nixon, Esquires, or their agents. 
 
 3d. That every subscriber of less than five shares shall pay the whole sum 
 n the day ot his subscription, 
 
 hat every subscriber of five shares or upwards pay one half of the 
 subscription, and the other half within three months of 
 
 4th. T 
 sum on 
 that da 
 
 tat a 
 
 5th. That every holder of a share shall be entitled to vote by himself his 
 agent, or proxy, properly appointed, at all elections of directors, and that he 
 
12 BANK OF NORTH AMERICA. 
 
 have as many votes as he holds shares? and that every subscriber may sell or 
 transfer his share or shares at pleasure, the transfer being made in the bank 
 books, in presence and with the approbation of the proprietor, or his lawful 
 attorney, the purchaser then to become entitled to the right of voting, &c. 
 
 6th. That there be twelve directors chosen from among those entitled to 
 vote, who, at their first meeting, shall choose one as president. 
 
 7th. That there be a meeting of directors quarterly, for the purpose of regu- 
 lating the affairs of the bank, and seven of the directors to make a Board, and 
 that the Board have power to adjourn from time to time. 
 
 8th. That the Board of Directors determine the manner of doing business, 
 and the rules and forms to be pursued, appoint the various officers which they 
 may find necessary, and dispose of the money and credit of the bank, for the 
 interest and benefit of the proprietors, and make, from time to time, such divi- 
 dends out of the profits, as they may think proper. 
 
 9th. That the Board be empowered, from time to time, to open new subscrip- 
 tions for the pu rose of increasing the capital of the bank, on such terms and 
 conditions as they shall think proper. 
 
 10th. That the Board, at every quarterly meeting, shall choose two directors 
 to inspect and control the business of the bank for the ensuing three months, 
 
 lira. That the inspectors, so chosen, shall, on the evening of every day, Sun- 
 days excepted, deliver to the superintendent of the finances of America, a 
 state of the cash account, and of the notes issued and received, 
 
 12th. That the bank notes,'payable on demand, shall, by law,be made receiv- 
 able in the duties and taxes of every State in the Union, and from the respec- 
 tive States, by the treasury of the United States, as specie. 
 
 13th. That the superintendent of the finances of America shall have a right, 
 at all times, to examine into the affairs of the bank, and for that purpose 
 shall have access to all the books and papers, 
 
 14th. That any director or officer ot the bank, who shall convert any of the 
 property, moneys, or credits thereof, to his own use, or shall, any other way, 
 be guilty of fraud, or embezzlement, shall forfeit all his share or stock to the 
 company. 
 
 15th. That laws shall be passed, making it felony, without benefit of clergy, 
 to commit such fraud or embezzlement, 
 
 16th. That the subscribers shall be incorporated under the name of" the Pre- 
 sident, Directors, and Company, of the Bank of North America/' 
 
 17th. That none of the directors shall be entitled to any pecuniary advantage 
 for his attendance on the duties of his office as director, or as president or 
 inspector, unless an alteration, in this respect, shall hereafter be made, by the 
 consent of a majority of the stocklvolders, at a general election. 
 
 18th. That, as soon as the subscription shall be filled, George Clymer and 
 John Nixon, Esquires, shall publish a list of the names and sums respec- 
 tively subscribed, with the place of abode of the subscribers, and appoint a 
 day tor the choice of directors, to whom, when chosen, they shall deliver over 
 the money by them received. 
 
 DECEMBER 29, 1781. 
 
 An ordinance for incorporating the subscribers to the national bank was 
 read a first time. 
 
 Ordered, That Monday next be assigned for a second reading. 
 
 MONDAY, December 3 1st. 
 
 The said ordinance was read a second and third time, and agreed to, as fol- 
 lows: 
 Jin Ordinance to incorporate the subscribers to the Bank of North America. 
 
 Whereas Congress, on the 26th day of May last, did, from a conviction of 
 the support which the finances of the United States would receive from the 
 establishment of a National Bank, approve a plan for such an institution, sub- 
 mitted to their consideration by Robert Morris, Esq. and now lodged among 
 
CHARTERED BY CONGRESS. jg 
 
 the archives of Congress, and did engage to promote the same by the most 
 effectual means: And whereas the subscription thereto is now fillet!, from an 
 expectation of a charter of incorporation from Congress, the directors and 
 president are chosen, and application hath been made to Congress, by the 
 said president and directors, for an act of incorporation: And whereas the 
 exigencies of the United States render it indispensably necessary that such 
 an act be immediately passed: 
 
 Be it therefore ordained and it is hereby ordained by the United States 
 in Congress assembled, That those who are, and those who shall become, sub- 
 scribers to the said bank, be, and forever after shall be, a corporation and body 
 politic, to all intents and purposes, by the name and style of k< The President, 
 Directors, and Company, of the Bank of North America." 
 
 Jind be it further ordained, That the said corporation are hereby declared 
 and made able and capable, in law, to have, purchase, receive, possess, enjoy, 
 and retain, lands, rents, tenements, hereditaments, goods, chattels, and effects, 
 of what kind, nature, or quality, soever, to the amount of ten millions of Spa- 
 nish silver milled dollars, and no more: and, also, to sell, grant, demise, alien, 
 or dispose of, the same lands, rents, tenements, hereditaments, goods, chattels, 
 and effects. 
 
 And be it further ordained, That the said coporation be, and shall be, for 
 ever, hereafter, able and capable, in law, to sue and be sued, plead and be im- 
 pleaded, answer and be answered unto, defend and be defended, in courts 
 of record, or any other place whatsoever, and to do and execute all and singu- 
 lar other matters and things that to them shall or may appertain to do. 
 
 And be it further ordained. That, for the well governing of the said cor- 
 poration and the ordering of their affairs, they shall have such officers as they 
 shall hereafter direct orappoint. Provided* never thde99, That twelve direc- 
 tors, one of whom shall be the president of the corporation, be of the number 
 of their officer-. 
 
 And be it further ordained, 'That Thomas Willing be the present president, 
 and that the said Thomas Willing and Thomas Fitzsimmons, John Maxwell 
 Nesbit, James Wilson, Homy Hill, Samuel Osgood. Cadwallader Morris, 
 Andrew Caldwell, Samuel Inglis, Samuel Meredith, William Hinghani, 
 Timothy Matlack, be the present directors of the said corporation ^ and shall 
 so continue until another president and other directors shall be chosen, ac- 
 cording to the laws and regulations of the said corporation. 
 
 And be it further ordainc d* That the president and directors of the said 
 corporation shall be capable of exercising such power for the well governing 
 and ordering of the affairs of the said corporation, and of holding such occa- 
 sional meetings for that purpose, as shall be described, fixed, and determined, 
 by the laws, regulations, and ordinances, of the said corporation. 
 
 Jlnd be it further ordained. That the said corporation may make, ordain, 
 establish, and put in execution, such laws, ordinances, and regulations, as 
 shall seem necessary and convenient to the government of the said corpora- 
 tion . 
 
 Provided* always. That nothing herein before continued shall be construed 
 to authorize the said corporation to exerci/e any powers, in any of the United 
 States, repugnant to the laws or constitution of such State. 
 
 Ana be it further ordained, That the said corporation shall have full power 
 and authority to make, have, and use, a common seal, with such device and 
 inscription as they shall think proper, and the same to break, alter, and renew, 
 at their pleasure. 
 
 Jlnd be it further ordained. That this ordinance shall be construed and 
 taken most favorably and beneficially for the said corporation. 
 
 Done by the United States in Congress assembled, &c. 
 
 Resolved, That it be recommended to the Legislature of each State to pass 
 such laws as they may judge necessary, for giving the foregoing ordinance its 
 full operation, agreeably to the true intent and meaning thereof, and accord- 
 
|4 BANK OF NORTH AMERICA 
 
 
 
 ing to the recommendations contained in the resolutions of the 26th day ot 
 May last. 
 
 NOTE. By the kindness of the author, the editors are enabled to lay before their 
 readers the following- interesting- extract in relation to this bank, from the life of Go- 
 verneur Morris, recently published. 
 
 " One of the first acts of the Superintendent of Finance was to propose the plan of 
 a bank, which was incorporated by Congress, under the name of the Bank of North 
 America. Mr. Governcur Morris says, in a letter to a friend, written not long 1 before his 
 death, the first bank in this country was planned by your humble servant.' By this, 
 he probably meant, that he drew up the plan of the bank, and the observations accom- 
 panying- ;t, which were presented to Congress, and not, that he, individually, origi- 
 nated the scheme . This was doubtless matured in conjunction with the superintendent. 
 A warm friendship had subsisted between them for some time, which, it may be pre- 
 sumed, was increased by a similarity in their turn of mind for financial pursuits. To 
 Hamilton, also, may properly be ascribed a portion of the merit in forming 1 this bank. 
 About two weeks before the plan was sent to Congress, Hamilton wrote a letter to 
 Robert Morris, enclosing- an elaborate project for a bank. In a letter acknowledging 
 the reception of this paper, the financier speaks of it with commendation. He says, 
 'I have read your performance with that attention which it justly deserves, and finding- 
 many parts of it to coincide with my own opinions on the subject, it naturally strength- 
 ened that confidence, which every man ought to possess, to a certain degree, in his 
 own judgment.' He then tells him that he shall communicate it to the directors of 
 the bank, to aid them in their deliberation on certain points, which it was not thought 
 expedient to embrace in the plan itself, particularly that of interweaving a security 
 with the capital. 
 
 " This bank had an extraordinary effect in restoring public and private credit in the 
 country, and was of immense utility in aiding the future operations of the financier, 
 although it was begun with the small capital of $400,000. Hamilton's project contem- 
 plated a vastly larger sum, in which Mr. Morris agreed with him, but its immediate 
 success, on so large a scale, was doubtful, and if it failed in the outset, it could not be 
 revived; whereas, by beginning with a small capital, and establishing a credit with 
 the public, gradually, it would be easy afterwards to increase the amount, and, in the 
 end, all needful advantages would be derived, to the utmost extent of banking facilities. " 
 See Sparks' Life of Governeur Morris, vol. 1, page 235. 
 
 In the same valuable work will be found, also, an address of Mr. Morris to the Gen- 
 eral Assembly of Pennsylvania, in behalf of the said bank, in 1785, on an occasion 
 when a proposition had been made to abolish its charter. It is written with uncom- 
 mon ability and knowledge of the subject, considering the infancy, at that period, of 
 banking operations in this country. Sec vol. Ill, page 437. 
 

 CHAPTER II. 
 
 BANK OF THE UNITED STATES. 
 
 PROCEEDINGS ON THE GRANT OF THE FIRST CHARTER, IN 1791. 
 
 HorsE OF REPRESENTATIVES, ? 
 
 i 'ungresa, Third Session. 5 
 
 ON the 14th December, 1790, as appears by the Journals of the House of 
 Representatives of that date, (see vol. 1, page 336> the Secretary of the 
 Treasury, Alexander Hamilton, transmitted to the House a letter, accom- 
 panying his Report, No. 2, of a plan for the institution of a National 15ank; 
 which was read and ordered* to be referred to a Committee of the \Vhol< 
 House, on that day se'nnight. 
 
 On the xJ3d of December, it was 
 
 Ordered, That the Clerk of the House do communicate to the Senate thai, 
 this House has received a report from the Secretary of the Treasury, contain- 
 ing a plan for a National Bank, and that he cany an attested copy of the said 
 report to the Senate. The report was as follows: 
 
 In obedience to the order of the House of Representatives, of the ninth day 
 of August last, requiring the Secretary of the Treasury to prepare and re-- 
 port, on this day, such further provision as may, in his opinion, be neces- 
 sary for establishing the public credit, the said Secretary further respect- 
 fully reports: t 
 
 That, from a conviction that a National Hank is an institution of primary 
 importance to the prosperous administration of the finances, and would be of 
 the greatest utility in the operations connected with the support of the public 
 credr&Shis attention has been drawn to devising the plan of such -an institu- 
 tion, upon a scale which will entitle it to the confidence, and be likely to 
 render it equal to the exigencies of the public. 
 
 Previously to entering upon the detail of this plan, he intreats the indul- 
 gence of the House towards some preliminary reflections naturally arising out 
 of the subject, which he hopes will be deemed neither useless nor out of place. 
 Public opinion being the ultimate arbiter of every measure of government, it 
 can scarcely appear improper, in deference to that, to accompany the origi- 
 nation of any new proposition with explanations, which the superior informa- 
 tion of those to whom it is immediately addressed, would rentier superiiuous. 
 
 It is a fact, well understood, tha^public banks have found admission and 
 patronage among the principal and most enlightened commercial nations. 
 They have successively obtained in Italy, Germany, Holland, England, and 
 France, as well as in the United States. * Ami it is a circumstance which 
 cannot but have considerable weight, in a candid estimate of their tendency, 
 that, after an experience of centuries, there exists not a question about their 
 utility, in the countries in which they have been so long established. Theo- 
 rists and men of business unite in the acknowledgment of it. 
 y Trade and industry, wherever they have been tried, have been indebted to 
 them for important aid. And government has been repeatedly under the 
 greatest obligations to them in dangerous and dirt, ^hm emergencies. That 
 
1(3 BANK OF THE UNITED STATES. 
 
 of the United States, as well in some of the most critical conjunctures of the 
 late war, as since the peace, has received assistance from those established 
 among us, with which it could not have dispensed. "N 
 
 With this twofold evidence before us, it might be expected that there would 
 be a perfect union of opinions in their favor. -Yet doubts have been enter- 
 tained: jealousies and prejudices have circulated;, and, though the experi- 
 ment is every day dissipating them, within the spheres in which effects are 
 best known, yet there are still persons by whom they have not been entirely 
 renounced. To give a full and accurate view of the subject, would be to 
 make a treatise of a report; but there are certain aspects in which it may be 
 cursorily exhibited, which may perhaps conduce to a just impression of its 
 merits. These will involve a comparison of the advantages with the disad- 
 vantages, real or supposed, of such institutions. 
 
 The following are among the principal advantages of a bank: 
 First. The augmentation of the active or productive capital of a country. 
 Gold and silver, when they are employed merely as the instruments of ex- 
 change and alienation, have been, not improperly, denominated dead stock; 
 but when deposited in banks, to become the basis of a paper circulation, which 
 takes their character and place, as the signs or representatives of value, they 
 then acquire life, or, in other words, an active and productive quality X This 
 idea, which appears rather subtile and abstract, in a general form, may be 
 made obvious and palpable, by entering into a feTv particulars. It is evident, 
 for instance, that th<Hmoriey which a merchant keeps in his chest, waiting 
 for a favorable opportunity to employ it, produces nothing till that opportu- 
 nity arrives. But if, instead of locking it up in this manner, he either de- 
 posites it in a bank, or invests it in the stock of a bank, it yields a profit 
 during the interval, in which he partakes, or not, according to the choice he 
 may have made of being a depositor or a proprietor^ and when any advanta- 
 geous speculation offers, in order to be able to embrace it, he has only to 
 withdraw his money, if a depositor-, or, if a proprietor, to obtain a loan from 
 the bank, or to dispose of his stock an alternative seldom or never attended 
 with difficulty, when the affairs of the institution are in a prosperous train. 
 vHis money, thus deposited or invested, is a fund upon which himself and 
 others can borrow to a injich larger amount. V It is a well established feet. \ 
 that banks in good credit can circulate a far greater sum than the actual 
 quantum of their capital in gold and silver./ The extent of the possible ex- 
 cess seems indeterminate; though it has been conjecturally stated at the pro- 
 portions of two and three to one. This faculty is produced in various ways. 
 1st. A great proportion of the notes which are issued, and pass current as 
 cash, are indefinitely suspended in circulation, from the confidence which 
 each holder has, that he can, at any moment, turn them into gold and silver. 
 2dly. Every loan which a bank makes, is, in its first shape, a credit given to 
 the borrower on its books, the amount of which it stands ready to pay, either 
 in its own notes, or in gold or silver, at his option. But, in a great number of 
 cases, no actual payment is made in either. The borrower frequently, by a 
 check or order, transfers his credit to some other person, to whom he has a 
 payment to make; who, in his turn, is as often content with a similar credit, 
 pecause he is satisfied that he can, whenever he pleases, either convert it 
 into cash, or pass it to some other hand, as an equivalent for it. And in this 
 manner the credit keeps circulating, performing in e'very stage the office of 
 money, till it is extinguished by a discount with some person who has a pay- 
 ment to make to the bank, to an equal or greater amount.^Thus large sums 
 are lent and paid, frequently through a variety of hands, without the inter- 
 vention of a single piece of coin, \ficlly. There is always a large quantity of 
 gold and silver m the repositories of the bank, besides its own stock, which 
 is placed there, with a view partly to its safe keeping, and partly to the ac- 
 commodation of an institution,, which is itself a source of general accommoda- 
 tion. % These deposites are of immense consequence in the operations of a 
 bank. Though liable to be redrawn at any moment, experience proves that 
 
CHARTER OF 1791. 17 
 
 die money so much oftener changes proprietors than place, and that what is 
 drawn out is generally so speedily replaced, as to authorize the counting 
 upon the sums deposited, as an effective fund, which, concurring with the 
 stock of the bank, enables it to extend its loans, and to answer all the de- 
 mands for coin, whether in consequence of those loans, or arising from the 
 occasional return of its note?. 
 
 These different circumstances explain the manner in which the ability of a 
 bank to circulate a greater sum than its actual capital in coin, is acquired. 
 This, however, must be gradual, and must be preceded by a. firm establish- 
 ment of confidence a confidence which mav be bestowed on the most rational 
 grounds, since the excess in question will always be bottomed on good secu- 
 rity of one kind or another. This, every well conducted bank carefully re- 
 quires, before it will consent to advance either its money or its credit, and 
 where there is an auxiliary capital, (as will be the case in the plan hereafter 
 submitted) which, together with the capital in coin, define the boundary that 
 shall not be exceeded by the engagements of the bank, the security may. con- 
 sistently with all the maxims of a reasonable circumspection, be regarded as 
 complete. 
 
 ; The same circumstances illustrate the truth of the position, that it is one 
 of the properties of banks to increase the active capital of a country. This, 
 in other words, is the sum of them: the money of one individual, while he is 
 waiting for an opportunity to employ it, by being either deposited in the bank 
 for safe keeping, or invested in its stock, is in a condition to administer to 
 the wants or others, without being put out ot his own reach when occasion 
 presents. This yields an extra profit, arising from what is paid for the use of 
 nis money by others, when he could not himself make use of it, and keeps 
 the money itself in a state of incessant activity. In the almost infinite vicis- 
 situdes and competitions of mercantile enterprise, there never can be danger 
 of an intermission of demand, or that the money will remain for a moment 
 idle in the vaults of the bank. This additional employment given to money, 
 and the faculty of a bank to lend and circulate a greater sum than the amount 
 of its stock in coin, are, to all the purposes of trade and industry, an absolute 
 increase of capital. Purchases ana undertakings, in general, can be carried 
 on by any given sum of bank paper or credit, as effectually as by an equal 
 sum of gold and silver. '-And thus, by contributing to enlarge the mass of 
 industrious and commercial enterprise, banks become nurseries of national 
 wealth a consequence as satisfactorily verified by experience, as it is clearly 
 deducible in theory./ 
 
 Secondly. Greater facility to tta government, in obtaining pecuniary aids, 
 especially in sudden emergencies^ This is another, and an undisputed advan- 
 tage of public banks one which, as already remarked, has been realized in 
 signal instances among ourselves. The reason is obvious^ the capitals of a 
 great number of individuals are, by this operation, collected to a point, and 
 placed under one direction. The mass formed by this union, is, in a certain 
 sense, magnified by the credit attached to itj and while this mass is always 
 ready, and can at once be put in motion, in aid of the government, the inter- 
 est of the bank to afford that aid, independent of regard to the public safety 
 and welfare, is a sure pledge for its disposition to go as far in its compliances 
 as can in prudence be desired. There is, in the nature of things, as will be 
 more particularly noticed in another placeman intimate connexion of i 
 between the government and the bank of a nation,/ 
 
 Thirdly. The facilitating of the payment of taxes.,? This advantage is pro-' 
 duced in two ways. /Those who are in a situation to have access to the bank, 
 can have the assistance of loans, to answer, with punctuality, the public calls 
 upon them.-This accommodation has been sensibly felt in the payment of the 
 duties heretofore laid by thf)se who reside where establishments of this nature 
 exist. This, however, though an extensive, is not an universal benefit. -The 
 other way in which the effect here contemplated is produced, and in which 
 the benefit is general, isthe increasing of the quantity of circulating medium, 
 and the quickening of circulation." The manner in which the first happens, 
 3 
 
18 BANK OF THE UNITED STATES. 
 
 has already been traced. The last may require some illustration. When 
 payments are to be made between different places, having an intercourse of 
 business with each other, if there happen to be no private bills at market, and 
 there are no bank notes which have a currency in both, the consequence is, 
 that coin must be remitted. This is attended with trouble, delay, expense, 
 and risk. If, on the contrary, there are bank notes current in both places, 
 the transmission of these by the post, or any other speedy or convenient con- 
 veyance, answers the purpose^and these again, in the alternations of de- 
 mand, are frequently returned, veiy soon after, to the place from whence 
 they were first sent: whence the transportation and re -transportation of the 
 metals are obviated, and a more convenient and more expeditious medium of 
 payment is substituted. Nor is this all : the metals, instead of being sus- 
 pended from their usual functions during this process of vibration from place 
 to place, continue in activity, and administer still to the ordinary circulation, 
 which, of course, is prevented from suffering either diminution or stagnation. 
 These circumstances are additional causes oif what, in a practical sense, or 
 to the purposes of business, may be called greater plenty of money* And 
 it is evident, that whatever enhances the quantity of circulating money, adds 
 to the ease with which every industrious member of the community may ac- 
 quire that portion of it of which lie stands in need, and enables him the better 
 to pay his taxes, as well as to supply his other wants. Even where the cir- 
 culation of (he bank paper is not general, it must still have the same effect, 
 though in a less degree: for, whatever furnishes additional supplies to the 
 channels of circulation, in one quarter, naturally contributes to keep the 
 streams fuller elsewhere. This last view of the subject serves both to illus- 
 trate the position that banks tend to facilitate the payment of taxes, and to 
 exemplify their utility to business of every kind in which money is an agent. 
 It would be to intrude too much on the patience of the House, to prolong 
 the details of the advantages of banks; especially, as all those which might 
 still be particularized, are readily to be inferred as consequences from those 
 which have been enumerated. Their disadvantages, real or supposed, are 
 now to be reviewed. The most serious of the charges which have been brought 
 against them, are, 
 
 / That they serve to increase usury; 
 
 That they tend to prevent other kinds of lending; 
 
 That they furnish temptations to overtrading; 
 
 * That they afford aid to ignorant adventurers, who disturb the natural and 
 beneficial course of trade; 
 
 5 That they give to bankrupt and fraudulent traders a fictitious credit, which 
 enables them to maintain false appearances, and to extend their impositions; 
 and, lastly, 
 
 t That they have a tendency to banish gold and silver from the country. 
 
 There is great reason to believe that, on a close and candid survey, it will 
 be discovered that these charges are either destitute of foundation, or that, as 
 far as the evils they suggest nave been found to exist, they have proceeded 
 from other, or partial, or temporary causes; are not inherent in the nature 
 and permanent tendency of such institutions; or are more than counterba- 
 lanced by opposite advantages. This survey shall be had, in the order in which 
 the charges nave been stated. The first of them is 
 
 ^ That banks serve to increase usury. 
 
 It is a truth, which ought not to be denied, that the method of conducting 
 business, which is essential to bank operations, has, among us, in particular 
 instances, given occasion to usurious transactions. The punctuality in pay- 
 ments, which they necessarily exact, has sometimes obliged those who have 
 adventured beyond both their capital and their credit, to procure money at 
 any price, and, consequently, to resort to usurers for aid. 
 
 But experience and practice gradually bring a cure to this evil. A general 
 habit of punctuality among traders is the natural consequence of the neces- 
 
CHARTER OF 1791. 1Q 
 
 sity of observing it with the bank; a circumstance which, itself, more than 
 compensates for any occasional ill which may have sprung from that necessi- 
 ty, in the particular under consideration. As far, therefore, as traders depend 
 on each other for pecuniary supplies, they can calculate their expectations 
 with greater certainty; and are in proportionably less danger of disappoint- 
 ments, which might compel them to have recourse to so pernicious an expe- 
 dient as that of borrowing atusury^the mischiefs of which, after a few ex- 
 amples, naturally inspire great care in all but men of desperate circumstan- 
 ces, to avoid the possibility of being subjected to them. One, and not the 
 least of these evils incident to the Hse of that expedient, if the fact be known, 
 or even strongly suspected, is" loss of credit with the bank itself. 
 
 The directors of a bank, too, though, in order to extend its business and its 
 popularity, in the infancy of an institution, they may be tempted to go fur- 
 ther in accommodation than the strict rules of prudence will warrant, grow 
 more circumspect, of course, *&s its affairs become better established, and 
 as evils of too great facility are experimentally demonstrated. They be- 
 come more attentive to the situation and conduct of those with whom they 
 deal; they observe more narrowly their operations and pursuits; they econo- 
 mize the credit they give to those of suspicious solidity^ they refuse it to those 
 whose career is more manifestly hazardous. In a word, in the course of 
 practice, from the very nature of things, the interest will make it the policy 
 of a bank to succor the wary and industrious; to discredit the rash and un- 
 thrifty; to discountenance both usurious lenders and usurious borrowers. 
 
 There is a leading view, in which the tendency of banks will be seen to be, 
 to abridge rather than to promote usury. This relates to their property of in- 
 creasing the quantity and quickening the circulation of money. If it be evi- 
 dent that usury will prevail or diminish, according to the proportion which 
 the demand for borrowing bears to the quantity of money at market to be 
 lent;, whatever has the property just mentioned, whether it be in the shape 
 of paper or cohvl^y contributing to render the supply more equal to the de- 
 mand, must tend to counteract the progress of usury. 
 
 But bank lending, it is pretended, is an impediment to other kinds of lend- 
 ing; which, by confining the resource of borrowing to a particular class, leaves . 
 the rest of the community more destitute, and, therefore, more exposed to 
 the extortions of usurers. As the profits of bank stock exceed me legal 
 rate of interest, the, possessors of money, it is urged, prefer investing it in 
 that article to lending it at this rate^ to which there are the additional mo- 
 tives of a more prompt command of the capital, and of more frequent and 
 exact returns, without trouble or perplexity in the collection. This consti- 
 tutes the second charge which has been enumerated- 
 
 The fact on which this charge rests is not to be admitted without several 
 <iualifications; particularly in reference to the state of things in this country. 
 first. The greajt bulk of the stock of a bank will consist of the funds of men 
 in trade, among^ ourselves, and moneyed foreigners^ the former of whom could 
 not spare their capitals out of their reach, to be invested in loans for long 
 periods, on mortgages or personal security; and the latter of whom would 
 not be willing to be subjected to the casual ties,[delays, and embarrasments, 
 of such a disposition of their money, in a distant country. Secondly. There 
 will always be a considerable proportion of those who are properly the money 
 lenders of a country, who, from that spirit of caution which usually character- 
 izes this description of men, will incline rather to vest their funds in mort- 
 gages on real estate, than in the stock of a bank, which they are apt'to consi- 
 der as a more precarious security. 
 
 These considerations serve, in a material degree, to narrow the foundation 
 of the objection, as to the point of fact, But there is a more satisfactory an- 
 swer to it. The effect supposed, as far as it has existence, is temporary. The 
 reverse of it takes place in the general and permanent operation of the thing. 
 The capital of every public bank will, of course, be restricted within a cer- 
 tain denned limit. It is the province of legislative prudence so to adjust this 
 limit, that, while it will not be too contracted for the demand which the course 
 
20 BANK OF THE UNITED STATES. 
 
 of business may create, and for the security which the public ought to have 
 for the solidity of the paper which may be issued by the bank, it will still be 
 within the compass of the pecuniary resources of the community; so that there 
 may be an easy practicability of completing the subscriptions to it. When 
 this is once done, the supposed effect of necessity ceases. There is then no 
 longer room for the investment of any additional capital. Stock may indeed 
 change hands by one person selling and another buy ing; but the money which 
 the buyer takes out of the common mass to purchase the stock, the seller re- 
 ceives and restores to it. Hence, the future surplusses which may accumulate 
 must take their natural course, and lending at interest must go on as if there 
 were no such institution. 
 
 It must, indeed, flow in a more copious stream. The bank furnishes an 
 extraordinary supply for borrowers, within its immediate sphere. A largev 
 supply consequently remains for borrowers elsewhere. In proportion as the 
 circulation ot the bank is extended, there is an augmentation of the aggre- 
 gate mass of money for answering the aggregate mass of demand. Hence* 
 greater facility in obtaining it for every purpose. 
 
 It ought not to escape without a remark, that, as far as the citizens of other 
 countries become adventurers in the bank, there is a positive increase of the 
 gold and silver of the country. It is true, that, from this, a half yearly rent 
 is di^yn back, accruing from the dividends upon the stock.. But as this 
 rent arises from the employment of the capital by our own citizens, it is pro- 
 bable that it is more than replaced by the profits of that employment. It i& 
 also likely that a part of it is, in the course of trade, converted inta the pro- 
 ducts of our country; and it may even prove an incentive, in some cases, to 
 emigration to a country,. i* 1 which the character of citizen is as easy to be ac- 
 quired as it is estimable and important.. This view of the subject furnishes 
 an answer to an objection whicn has been deduced from the circumstance 
 here taken notice of, namely, the income resulting to foreigners from the part 
 of the stock owned by them, which has been represented as tending to drain, 
 the country of its specie. In this objection, the original investment of the 
 capital, and the constant use of it afterwards, seem. both to have been over-- 
 
 "^That banks furnish, temptations to overtrading, is the third of the enumerated 
 objections. This must mean, that, by affording additional aids to mercantile 
 enterprise, they induce the merchant sometimes to adventure beyond the 
 prudent or salutary point. But the very statement of the thin^ shows that the 
 subject of the charge is an occasional ill, incident to a general good. Credit 
 of every kind, (as a species of which only, can bank lending have the effect 
 supposed) must be, in different degrees,, chargeable with the same inconve- 
 nience. It is even applicable to gold and silveiv when they abound in circula- 
 tion. But would it be wise, on this account, to decry the precious matals, to. 
 root out credit, or to proscribe the means of that enterprise which is the main- 
 spring of trade, and a principal source of national wealth, because it now and 
 then runs into excesses,, of which overtrading is one.^ 
 
 If the abuses of a beneficial thing are to determine its condemnation there 
 is scarcely a source of public prosperity which will not speedily be closed- 
 In every case the evil is to be compared with the good; and in the present 
 ease, such a comparison will issue in this, that the new and increased energies 
 derived to commercial enterprise, from the aid of banks, are a source of gen- 
 eral profit and advantage, which greatly outweigh the partial ills, the over- 
 trading of a few individuals at particular times, or of numbers in particular 
 conjunctures. 
 
 ^ The fourth and- fifth charges may be considered together.. These relate to 
 the aid which is sometimes afforded by banks to unskilful adventurers and 
 fraudulent traders* These charges also have some degree of foundation, 
 though far less than has been pretended; and they add to the instances of 
 
 s partial ills, connected with more extensive and overbalancing benefits. 
 
 The practice of giving fictitious credit to improper persons, is one of those 
 evils which experience, guided by interest, speedily corrects. The bank itself 
 
CHARTER OF 1791. 1 
 
 is in so much jeopardy of being a sufferer by it, that it has the strongest of all 
 inducements to be on its guard. It may not only be injured immediately by 
 the delinquencies of the persons to whom such credit is given, but eventually 
 by the incapacities of others, whom their impositions or failures may have 
 ruined. 
 
 Nor is there much danger of a bank's being betrayed into this error from 
 want of information. The directors themselves being, for the most part, se- 
 lected from the class of traders, are to be expected to possess individually an 
 accurate knowledge of the characters and situations of those who come within 
 that description. And they have, in addition to this, the course of dealing 
 of the persons themselves with the bank, to assist their judgment, which is 
 in most cases a good index of the state in which those persons are- The arti- 
 fices and shifts which those in desperate or declining circumstances are obli- 
 ged to employ, to keep up the countenance which the rules of the bank re- 
 quire, and the train ot their connexions, are so many prognostics, not difficult 
 to be interpreted, of the fate which awaits them. Hence, it not unfrequently 
 happens, that banks are the first to discover the unsoundness of such charac- 
 ters, and, by withholding credit, to announce to the public that they are not 
 entitled to it. 
 
 If banks, in spite of every precaution, are sometimes betrayed into giving 
 a false credit to the persons described, they more frequently enable honest 
 and industrious men, of small, or, perhaps, of no capital, to undertake and pro - 
 secute business with advantage to themselves and to the community; and as- 
 sist merchants, of both capital and credit, who meet with fortuitous and un- 
 foreseen shocks, which might, without such helps, prove fatal to them and to 
 others, to make head against their misfortunes, and finally to retrieve their 
 affairs circumstances which form no inconsiderable encomium on the utility 
 of banks. 
 
 ~~ But the last and heaviest charge is still to be examined: this is, that banks 
 tend to banish the gold and silver of the country. 
 
 The force of this objection rests upon their being an engine of paper credit, 
 which, by furnishing a substitute for the metals, is supposed to promote their 
 exportation. It is an objection, which, if it has any foundation, lies not against 
 banks peculiarly, but against every species of paper credit. 
 
 The most common answer given to it is, that the thing supposed is of little 
 or no consequence; that it is immaterial what serves the purpose of money, 
 whether paper or gold and silver; that the effect of both upon industry is the 
 same; and that the intrinsic wealth of a nation is to be measured, not by the 
 abundance of the precious metals contained in it, but by the quantity of the. 
 productions of its labor and industry. 
 
 This answer is not destitute of solidity, though not entirely satisfactory. It 
 is certain, that the vivification of industry, by a full circulation, with the aid of 
 a proper and well regulated paper credit, may more than compensate for the 
 loss ot a part of the gold and silver of a nation, if the consequence of avoiding 
 that loss should be a scanty or defective circulation. 
 
 But the positive and permanent increase or decrease of the precious metals 
 in a country can hardly ever be a matter of indifference. As the commodity 
 taken HI lieu of every other, it is a species of the most effective wealth; and 
 as the money of the world, it is of great concern to the State, that it possess 
 a sufficiency of it to face any demands which the protection of its external 
 interests may create. 
 
 The objection seems to admit of another and more conclusive answer, which 
 controverts the fact itself. A nation that has no mines of its own, must derive, 
 the precious metals from others; generally speaking, in exchange for the 
 products of its labor and industry. The quantity it will possess, will, there- 
 lore, in the ordinary course of things, be regulated by the favorable or unfa- 
 vorable balance of its trade; that is, by the proportion between its abilities to 
 supply foreigners, and its wants of them; between the amount of its exporta- 
 tions and that of its importations. Hence, the state of its agriculture and 
 manufactures, the quantity and quality of its labor and industry, must, in the 
 
22 BANK OF THE UNITED STATES. 
 
 main, influence and determine the increase or decrease of its gold and silver. 
 If this be true, the inference seems to be, that well constituted banks favor 
 the increase of the precious metals. It has been shown that they augment, in 
 different ways, the active capital of a country. This it is which generates 
 employment; which animates and expands labor and industry. Every addi- 
 tion which is made to it, by contributing to put in motion a greater quantity 
 ofbqthj tends to create a greater qi lantity of the products of both; and, by 
 furnishing more materials for exportation, conduces to a favorable balance of 
 trade, and, consequently, to the introduction and increase of gold and silver. 
 
 This conclusion appears to be drawn from solid premises. There are, how- 
 ever, objections to be made to it. 
 
 It may be said that, as bank paper affords a substitute for specie, it serves 
 to counteract that rigorous necessity for the metals, as a medium of circulation, 
 which, in the case of a wrong balance, might restrain, in some degree, their 
 exportation; and it may be added, that, from the same cause, in the same 
 case, it would retard those economical and parsimonious reforms in the manner 
 of living, which the scarcity of money is calculated to produce, and which 
 might be necessary to rectify such wrong balance. 
 
 There is, perhaps, some truth in D9th these observations; but they appear 
 to be of a nature rather to form exceptions to the generality of the conclusion, 
 than to overthrow it. The state of things in whicn the absolute exigencies of 
 circulation can be supposed to resist, with any effect, the urgent demands for 
 specie which a wrong balance of trade may occasion, presents an extreme case. 
 And a situation in which a too expensive manner of living of a community, 
 compared with its means, can stand in need of a corrective, from distress or 
 necessity, is one which, perhaps, rarely results but from extraordinary and 
 adventitious causes: such, for example, as a national revolution; which unset- 
 tles all the established habits of the people, and inflames the appetite for extra- 
 vagance, by the illusions of an ideal wealth, engendered by the continual 
 multiplication of a depreciating currency, or some similar cause. There is a 
 good reason to believe, that, where the laws are wise and well executed, and 
 the inviolability of property and contracts maintained, the economy of a people 
 will, in the general course of things, correspond with its means. 
 
 The support of industry is, probably, in every case, of more consequence 
 towards correcting a wrong balance of trade, than any practicable retrench- 
 ments in the expenses of families or individuals; and the stagnatiou of it would 
 be likely to have more effect in prolonging, than any such savings in shorten- 
 ing, its continuance. That stagnation is a natural consequence of an inade- 
 quate medium, which, without the aid of bank circulation, would, in the cases 
 supposed, be severely felt. 
 
 It also deserves notice, that, as the circulation is always in a compound 
 ratio to the fund upon which it depends, and to the demand for it, and as that 
 fund is itself affected by the exportation of the metals, there is no danger of 
 its being overstocked, as in the case of paper issued at the pleasure of the 
 government, or of its preventing the consequences of any unfavorable balance 
 from being sufficiently felt to produce the reforms alluded to, as far as cir- 
 cumstances may require and admit. 
 
 Nothing can be more fallible than the comparisons which have been made 
 between different countries, to illustrate the truth of the position unfler con- 
 sideration. The comparative quantity of gold and silver, in different countries 
 depends upon an infinite variety of facts and combinations, all of which ought 
 to be known in order to judge whether the existence or non-existence of paper 
 currencies has any share in the relative proportions they contain: the mass 
 and value of the productions of the labor and industry of each, compared with 
 its wants; the nature of its establishments abroad; the kind ot wars in which 
 it is usually engaged; the relations it bears to the countries which are the 
 original possesors of those metals; the privileges it enjoys in their trade; these, 
 and a number of other circumstances, are all to be taken into the account, 
 and render the investigation too complex to justify any reliance on the vague 
 and general surmises which have been hitherto hazarded on the point. 
 
CHARTER OF 1791. 23 
 
 In the foregoing discussion, the objection has been considered as applying to 
 the permanent expulsion and diminution of the metals- Their temporary ex- 
 portation, for particular purposes, has not been contemplated. This, it must 
 be confessed, is facilitated by banks, from the faculty they possess of sup- 
 plying their place. But their utility is in nothing more conspicuous than m 
 these very cases. They enable the government to pay its foreign debts, and 
 to answer any exigencies which the external concerns of the community may 
 have produced. They enable the merchant to support his credit, (on which 
 the prosperity of trade depends) when special circumstances prevent remit- 
 tances in other modes. They enable him also to prosecute enterprises which 
 ultimately tend to an augmentation of the species of wealth in question. It is 
 evident that gold and silver may often be employed in procuring commodities 
 abroad, which, in a circuitous commerce, replace the original fund, with con- 
 siderable addition. But it is not to be inferred, from this facility given to tem- 
 porary exportation, that banks, which are so friendly to trade and industry, 
 are, in their general tendency, inimical to the increase of the precious metals. 
 
 These several views of the subject appear sufficient to impress a full con- 
 viction of the utility of banks, and to demonstrate that they are of great im- 
 portance, not only in relation to the administration of the finances, but in the 
 general system of the, political economy. 
 
 The judgment of many concerning them has, no doubt, been perplexed, by 
 the misinterpretation of appearances which were to be ascribed to other causes. 
 The general devastation or personal property, occasioned by the late war, na- 
 turally produced, on the one hand, a great demand for money, and, on the 
 other, a great deficiency of it to answer the demand. Some injudicious laws, 
 which grew out of the public distresses, by impairing confidence, and causing 
 a part of the inadequate sum in the country to be locked up, aggravated the 
 evil. The dissipated habits contracted by many individuals, during the war, 
 which, after the peace, plunged them into expenses beyond their incomes; the 
 number of adventurers without capital, and, in many instances, without in- 
 formation, who at that epoch rushed into trade, and were obliged to make any 
 sacrifices to support a transient credit; the employment of considerable sunis 
 in speculations upon the public debt, which, from its unsettled state, was in- 
 capable of becoming itself a substitute: all these circumstances concurring, 
 necessarily led to usurious borrowing, produced most of the inconveniences, 
 and were the true causes of most of the appearances, which, where banks were 
 established, have been by some erroneously placed to their account a mistake 
 which they might easily have avoided by turning their eyes towards places 
 where there were none, and where, nevertheless, the same evils would have- 
 been perceived to exist, even in a greater degree than where those institutions 
 had obtained. 
 
 These evils have either ceased or been greatly mitigated. Their more com- 
 plete extinction may be looked for from that additional security to property 
 which the constitution of the United States happily gives; (a circumstance of 
 prodigious moment in the scale, both of public and private prosperity) from the 
 attraction of foreign capital, under the auspices of that security, to be employ- 
 ed upon objects, and in enterprises, for which the state of this country opens a 
 wide and inviting field; from the consistency and stability which the public 
 debt is fast acquiring, as well in the public opinion at home and abroad, as, in 
 fact, from the augmentation of capital which that circumstance and the quarter- 
 yearly payment of interest will afford; and from the more copious circulation 
 which will be likely to be created by a well constituted national bank. 
 
 The establishment of banks in this country seems to be recommended by |j 
 reasons of a peculiar nature. Previously to the Revolution, circulation was in H 
 a great measure carried on by paper emitted by the several local governments. 
 In Pennsylvania alone, the quantity of it was near a million and a half of dol- 
 lars. This auxiliary may be said to be now at an end. And it is generally 
 supposed that there has been, for some time past, a deficiency of circulating 
 medium. How far that deficiency is to be considered as real or imaginary, is 
 not susceptible of demonstration; but there are circumstances and appear- 
 
24 BANK OF THE UNITED STATES. 
 
 ances, which, in relation to the country at large, countenance the supposition of 
 its reality. 
 
 The circumstances are, besides the .fact just mentioned respecting paper 
 emissions, the vast tracts of waste land, and the little advanced state of manu- 
 factures. The progressive settlement of the former, while it promises ample 
 retribution, in the generation of future resources, diminishes or obstructs, in the 
 mean time, the active wealth of the country. It not only draws off a part of 
 the circulating money, and places it in a more passive state, but it diverts, into 
 its own channels, a portion of that species of labor and industry which would 
 otherwise be employed in furnishing materials for foreign trade, and which,by 
 contributing to a favorable balance, would assist the introduction of specie. 
 In the early periods of new settlements, the settlers not only furnish no sur- 
 plus for exportation, but they consume apart of that which is produced by the 
 labor of others. The same thing is a cause that manufactures do not advance, 
 or advance slowly. And, notwithstanding some hypotheses to the contrary, 
 there are many things to induce a suspicion, that the precious metals will not 
 abound in any country which has not mines, or variety of manufactures. 
 They have been sometimes acquired by the sword ; but the modern system of 
 war has expelled this resource, and it is one upon which it is to be hoped the 
 United States will never be inclined to rely. 
 
 The appearances alluded to are, greater prevalency of direct barter in the 
 more interior districts of the country which, however, has been for some 
 time past gradually lessening, and greater difficulty, generally, in the advanta- 
 geous alienation of improved real estate, which, also, has of late diminished, but 
 is still seriously felt in different parts of the Union. The difficulty of getting 
 money, \yhich has been a general complaint, is not added to the number, be- 
 cause it is the complaint of all times, and one in which imagination must ever 
 have too great scope to permit an appeal to it. 
 
 If the supposition of such a deficiency be in any degree founded, and some aid 
 , to circulation be desirable, it remains to inquire what ought to be the nature 
 of that aid. 
 
 The emitting of paper money by the authority of Government is wisely pro- 
 hibited to the individual States by the national constitution, and the spirit of 
 that prohibition ought not to be disregarded by the Government of the United 
 States. Though paper emissions, under a general authority, might have some 
 advantages not applicable, and be free from some disadvantages which are ap- 
 plicable to the like emissions by the States, separately, yet they are of a na- 
 ture so liable to abuse and, it may even be affirmed, so certain of being abus- 
 edthat the wisdom of the Government will be shown, in never trusting itself 
 with the use of so seducing and dangerous an expedient. In times of tranquil- 
 lity, it might have no ill consequence; it might even perhaps be managed in a 
 way to be productive of good; but, in great and trying emergencies, there is al- 
 most a moral certainty of its becoming mischievous. The stamping of paper is 
 an operation so much easier than the laying of taxes, that a government in the 
 practice of paper emissions, would rarely fail, in any such emergency, to indulge 
 itself too far in the employment of that resource, to avoid as much as possible 
 one less auspicious to present popularity. If it should not even be carried so 
 far as to be rendered an absolute bubble, it would at least be likely to be ex- 
 tended to a degree which would occasion an inflated and artificial state of 
 things, incompatible with the regular and prosperous course of the political 
 economy. 
 
 Among ot-iier material differences between a paper currency, issued by the 
 
 , mere authority of government, and one issued by a bank, payable in coin, is 
 
 |this: that, in the first case, there is no standard to which an appeal can be 
 
 " made, as to the quantity which will only satisfy, or which will surcharge the 
 
 circulation; in the last, that standard results from the demand. If more should 
 
 be issued than is necessary, it will return upon the bank. Its emissions, as 
 
 elsewhere intimated, must always be in a compound ratio to the fund and the 
 
 demand; whence it is evident, that there is a limitation in the nature of the 
 
'CHARTER OF 1791. 25 
 
 thing; while the discretion of the government is the only measure of the extent 
 of the emissions, by its own authority. 
 
 This consideration further illustrates the danger of emissions of that sort, 
 and the preference which is due to bank paper. 
 
 The payment of the interest of the public debt, at thirteen different places, is 
 a weighty reason, peculiar to our immediate situation, for desiring a bank cir- 
 culation. Without a paper in general currency, equivalent to gold and sil- 
 ver, a considerable proportion of' the specie of the country must always be sus- 
 pended from circulation, and left to accumulate, preparatory to each day of 
 payment; and as often as one approaches, there must in several cases be an ac- 
 tual transportation of the metals, at both expense and risk, from their natural 
 and proper reservoirs, .to distant places, M his necessity will be felt very in- 
 juriously to the trade of some of the States: and will embarrass, not a little, 
 the operations of the treasury in those States It will also obstruct those ne- 
 gotiations, between different parts of the Union, by the instrumentality of trea- 
 sury bills, which have alreacfy afforded valuable accommodations to trade in 
 general, 
 
 Assuming it, then, as a consequence, from what has been said, that a na- 
 tional bank is a desirable institution, two inquiries emerge: Is there no such in- 
 stitution, already in being, which has a claim to that character, and which su- 
 persedes the propriety or necessity of another? If there be none, what are the 
 principles upon which one ought to be established? 
 
 There are at present three, banks in the United States: that of North Ame- 
 rica, established in the city of Philadelphia: that of New York /established in 
 the citv of New York; that of Massachusetts, established in the tovvn of Bos- 
 ton. Of these three, the first is the only one which has at any time had a 
 direct relation to the Government of the United States^ 
 
 The Bank of North America originated in a resolution of Congress of the 
 2Gthof May, 1781, founded upon a proposition of the Superintendent of Fi- 
 nance, which was afterwards carried into execution by an ordinance of the 31st 
 of December following, entitled "An ordinance to incorporate the subscribers 
 to the Bank of North America." 
 
 The aid afforded to the United States by this institution, during the re- 
 maining period of the war, was of essential consequence; and its conduct 
 towards them since the peace, has not weakened its title to their patronage 
 and favor. So far, its pretensions to the character in question are respecta- 
 ble; but there are circumstances which militate against them, and considera- 
 tions which indicate the propriety of an establishment on different principles. 
 The directors of this bank, on behalf of their constituents, have since 
 accepted and acted under a new charter from the State of Pennsylvania, ma- / 
 terially variant from their original one, and which so narrows the foundation - 
 of the institution, as to render it an incompetent basis for the extensive pur- > 
 poses of a national bank. 
 
 The limit assigned by the ordinance of Congress to the stock of the bank, 
 is ten millions of dollars. The last charter of Pennsylvania confines it to 
 two millions. Questions naturally arise, whether there be not a direct re- 
 pugnancy between two charters so differently circumstanced? and whether 
 the acceptance of the one is not to be deemed a virtual surrender of the 
 other? But, perhaps it is neither advisable nor necessary to attempt a solu- 
 tion of them. 
 
 There is nothing in the acts of Congress which imply an exclusive right, 
 in the institution to which they relate, except during the term of the war. 
 There is, therefore, nothing, if the public good require it, which prevents the 
 establishment of another. It may, however, be incidentally remarked, that, 
 in the general opinion of the citizens of the United States, the Bank of North 
 America has taken the station of a bank of Pennsylvania only. This is a 
 strong argument for a new institution, or for a renovation of the old, to re- 
 store it to the situation in which it originally stood in the view of tb? United 
 States. 
 
 4 
 
20 BANK OF THE UNITED STATES. 
 
 But, though the ordinance of Congress contains no grant of exclusive pri- 
 vileges, there may be room to allege that the Government of the United 
 States ought not, in point of candor and equity, to establish any rival or in- 
 terfering institution, in prejudice of the one already established; especially 
 as this has, from services rendered, well founded claims to protection and 
 regard. 
 
 The justice of such an observation, ought, within proper bounds, to be ad- 
 mitted. A new establishment of the sort, ought not to be made without co- 
 gent and sincere reasons of public good. And in the manner of doing it, 
 every facility should be given to a consolidation of the old with the new, 
 upon terms not injurious to the parties concerned. But there is no ground 
 to maintain, that, in a case in which the Government has made no condition 
 restricting its authority, it ought voluntarily to restrict it, through regard to 
 the interests of a particular institution, when those of the State dictate a dif- 
 ferent course; especially, too, after such circumstances have intervened, as 
 characterise the actual situation of the Bank of North America. 
 
 The inducements to a new disposition of the thing are now to be consider- 
 ed. The first of them which occurs is, the at least ambiguous situation in 
 .which the Bank of North America has placed itself, by the acceptance of its 
 last charter. If this has rendered it the mere bank of a particular State, lia- 
 ble to dissolution at the expiration of fourteen years, to which term the act of 
 that State has restricted its duration, it would be neither fit nor expedient to 
 accept it as an equivalent for a bank of the United States. 
 
 The restriction of its capital, also, which, according to the same supposition, 
 cannot be extended beyond two millions of dollars, is a conclusive reason for 
 a different establishment. So small a capital promises neither the requisite 
 aid to Government, nor the requisite security to the community. It may an- 
 swer very well the purposes of local accommodation, but is an inadequate 
 foundation for a circulation co-extensive with the United States, embracing 
 the whole of their revenues, and effecting every individual into whose hands 
 the paper may come. 
 
 An*', inadequate as such a capital would be to the essential ends of a na- 
 tional bank, it is liable to be rendered still more so, by that principle of the 
 constitution of the Bank of North America, contained equally in its old and in 
 its new charter, which leaves the increase of the actual capital at any time 
 (now far short of the allowed extent) to the discretion of the directors or 
 stockholders. It is naturally to be expected, that the allurements of an ad- 
 vanced price of stock, and of large dividends, may disincline those who are 
 interested to an extension of capital, from which they will be apt to fear a 
 diminution of profits. And from this circumstance, the interest and accom- 
 modation of the public, (as well individually as collectively) are made more 
 subordinate to the interest, real or imagined, of the stockholders, than they 
 ought to be. It is true, that, unless the latter be consulted, there can be no 
 bank, (in the sense at least in which institutions of this kind, vyorthy of con- 
 Ifidence, can be established in this country.") But, it does not follow that this 
 lis alone to be consulted, or that it even ougnt to be paramount. Public utility 
 I is more truly the object of public banks than private profit. And it is the 
 business of Government to constitute them on such principles, that, while the 
 latter will result in a sufficient degree to afford competent motives to engage 
 in them, the former be not made subservient to it. To effect this, a principal 
 object of attention ought to be to give free scope to the creation of an ample 
 capital, and with this view, fixing the bounds which are deemed safe and con- 
 venient, to leave no discretion either to stop short of them, or to overpass 
 them. The want of this precaution, in the establishment of the Bank of North 
 America, is a further and an important reason for desiring one differently 
 constituted. 
 
 There may be room at first sight for a supposition, that, as the profits of a 
 bank will bear a proportion to the extent of its operations, and as. for this rea- 
 son, the interest of the stockholders will not be disadvantageous^ affected by 
 any necessary augmentations of capital, there is no cause to apprehend that 
 
< HARTER OF 1/91. 2? 
 
 will be indisposed to such augmentations. But most men. in matters of 
 ts nature, prefer the certainties they enjoy, to probabilities depending on 
 untried experiments, especially when these promise rather that they will not 
 be injured than that they will be benefitted. 
 
 From the influence of this principle, and a desire of enhancing its profits, 
 the directors of a bank will be more apt to overstrain its faculties, in an at- 
 tempt to face the additional demands which the course of business may create, 
 than to set on foot new subscriptions, which may hazard a diminution of the 
 profits, and even a temporary reduction of the price of stock. 
 
 Banks are among the best expedients for lowering the rate of interest in a 
 country: but, to have this effect, their capitals must be completely equal to 
 all the demands of business^ and such as will tend to remove the idea, that 
 the accommodations they afford are in any degree favors an idea very apt to 
 accompany tjie parsimonious dispensation of contracted funds. In this, as in 
 every other case, the plenty of the commodity ought to beget a moderation of 
 the price. 
 
 1 he want of a principle of rotation in the constitution of the Bank of North i 
 America is another argument for a variation of the establishment. Scarcely 
 one of the reasons which militate against this principle in the constitution of a 
 country, is applicable to that of a" bank; while there are strong reasons in 
 favor of it, in relation to the one, which do not apply to the other. The know- 
 ledge to be derived from experience is the only circumstance common to both, 
 which pleads against rotation in the directing officers of a bank. 
 
 But the objects of the government of a nation, and those of the government 
 of a bank, are so widely different, as greatly to weaken the force of that con- 
 sideration in reference to the latter. Almost eveiy important case of legisla- 
 tion requires, towards a right decision, a general and accurate acquaintance 
 with the affairs of the State, and habits of thinking, seldom acquired but from 
 a familiarity with public concerns. The administration of a bunk, on the con- 
 trary, is regulated by a few simple fixed maxims, the application of which is 
 not difficult to any man of judgment, especially if instructed in the principles 
 of trade. It is, in general, a constant succession of the same details. 
 
 But, though this be the case, the idea of the advantages of experience is not 
 to be slighted. Room ought to be left for the regular transmission of official 
 information,- and, for this purpose, the head of the direction ought to be ex- 
 cepted from the principle of rotation. With this exception, and with the aid 
 of the information of the subordinate officers, there can be no danger of any ill 
 effects from want of experience or knowledge; especially as the periodical 
 exclusion ought not to reach the whole of the directors at one time. 
 
 The argument in favor of the principle of rotation is this: that, by lessening 
 the danger of combinations among the directors, to make the institution sub- 
 servient to party views, or to the accommodation, preferably, of any particu- 
 lar set of men, it will render the public confidence more firm, stable, and un- 
 qualified. 
 
 AVhen it is considered that the directors of a bank are not elected by the 
 great body of the community, in which a diversity of views will naturally 
 prevail at different conjunctures, but by a small and select class of men, 
 among whom it is far more easv to cultivate a steady adherence to the same 
 persons and objects, and that those directors have it in their power so imme- 
 diately to conciliate, by obliging the most influential of this class, it is easy to 
 perceive that, without the principle of rotation, changes in that body can 
 rarely happen, but as a concession which they may themselves think it expe- 
 dient to make to public opinion. 
 
 The continual administration of an institution of this kind, by the same 
 persons, will never fail, with or without cause, from their conduct^ to excite 
 distrust and discontent. The necessary secrecy of their transactions gives 
 unlimited scope to imagination to infer that something is or may be wrong. 
 And this inevitable mystery is a solid reason for inserting in the constitution 
 of a bank the necessity of a change of men. As neither me mass of the par- 
 ties interested, nor the public in general, can be permitted to be witnesses of 
 
2g BANK OF THE UNITED STATES. 
 
 the interior management of the directors, it is reasonable that both should h.u <; 
 that check upon their conduct, and that security against the preyalency of a 
 partial or pernicious system, which will be produced by the certainty of peri- 
 odical changes. Such, too, is the delicacy of the 1 credit of a bank, that every 
 thing which can fortify confidence and repel, suspicion, without injuring ite 
 operations, ought _ carefully to be sought after in its formation. 
 * A further consideration in favor of a change, is the improper rule by which 
 the right of voting for directors is regulated in the plan upon which the Bank 
 of North America was originally constituted, namely, a vote for each share, 
 and the want of a rule in the last charter; unless the silence of it, on that 
 point, may signify that every stockholder is to have an equal and a single vote; 
 which would be a rule in a different extreme, not less erroneous. It is of im- 
 portance that a rule should be established on this head, as it is one of those 
 things which ought not to be left to discretion; and it is, consequently, of 
 equal importance that the rule should be a proper one. 
 
 A vote for each share renders a combination between a few principal stock- 
 holders, to monopolize the power and benefits of the bank, too easy. An 
 equal vote to each stockholder, however great or small his interest in the in- 
 stitution, allows not that degree of weight to large stockholders which it is 
 reasonable they should have, and which, perhaps, their security, and that of 
 the bank, require. A prudent mean is to be preferred. A conviction of this 
 has produced a by-law of the corporation of the Bank of North America, 
 which evidently aims at such a mean. But a reflection arises here, that a 
 like majority with that which enacted this law, may, at any moment, repeal it. 
 
 The last inducement which shall be mentioned, is the want of precautions 
 to guard against a foreign influence insinuating itself into the direction of the 
 bank. It seems scarcely reconcileable with a due caution, to permit that any 
 but citizens should be eligible, as directors of a national bank, or that non- 
 resident foreigners should be able to influence the appointment of directors 
 by the votes of their proxies. In the event, however, of an incorporation of 
 the Bank of North America, in the plan it may be necessary to qualify this 
 principle, so as to leave the right of foreigners, who now hold shares of its 
 stock, unimpaired; but without the power of transmitting the privilege in 
 question to foreign alienees. 
 
 It is to be considered that such a bank is not a mere matter of private pro- 
 perty, but a political machine of the greatest importance to the State, 
 
 There are other variations from trie constitution of the Bank of North 
 America, not of inconsiderable moment, which appear desirable, but which 
 are not of magnitude enough to claim a preliminary discussion. These will 
 be seen in the plan which will be submitted in the sequel. 
 
 If the objections which have been stated, to the constitution of the Bank of 
 North America, are admitted to be well founded, they will, nevertheless, 
 not derogate from the merit of the main design, or of the services which that 
 bank has rendered, or of the benefits which it lias produced. The creation 
 of such an institution, at the time it took place, was a measure dictated by 
 wisdom. Its utility has been amply evinced by its fruits American inde- 
 pendence owes much to it; and it is very conceivable, that reasons of the 
 moment may have rendered those features in it inexpedient, which a revision, 
 with a permanent view, suggests as desirable. 
 
 The order of the subject leads next to an inquiry into the principles upon 
 which a national bank ought to be organized. 
 
 The situation of the United States naturally inspires a wish that the form 
 of the institution could admit of a plurality of branches. But various con- 
 siderations discourage from pursuing this idea. The complexity of such a 
 plan would be apt to inspire doubts, which rnisht deter from adventuring in 
 it. And the practicability of a safe and orderly administration, though not 
 to be abandoned as desperate, cannot be made so manifest in perspective, as 
 to promise the removal of those doubts, or to justify the Government in adopt- 
 ing the idea as an original experiment. The most that would seem advisa- 
 ble, on this point, is to insert a provision which may lead to it hereafter, if 
 
( HARTER OF 1701, 29 
 
 experience shall nlore clearly demonstrate its utility, and satisfy those who 
 may have the direction, that it may be adopted with safety. It is certain 
 that it would have some advantages, both peculiar and important. Besides 
 more general accommodation, it would lessen the danger of a run upon the 
 bank, 
 
 The argument against it is, that each branch must be under a distinct, 
 though subordinate direction, to which a considerable latitude of discretion 
 must of necessity be entrusted. And as the property of the whole institution 
 would be liable for the engagements of each part, that and its credit \yould 
 be at stake, upon the prudence of the directors of every part. The misma- 
 nagement of either branch might hazard serious disorder in the whole. 
 
 Another wish, dictated by the particular situation of the country, is, that 
 the bank could be so constituted as to be made an immediate instrument of loans 
 to the proprietors of land; but this wish also yields to the difficulty of accom- 
 plishing it. Land is alone an unlit fund fora bank circulation. If the notes 
 issued upon it were not to be payable in coin, on demand, or at a short date, 
 this would amount to nothing more than a repetition of the paper emissions, 
 which are now exploded by the general voice. If the notes are to be payable 
 in coin, the land must first be converted into it by sale, or mortgage. The 
 difficulty of effecting the latter, is the very thing which begets the desire of 
 finding another resource, and the former would not be practicable on a sudden 
 emergency, but with sacrifices which would make the cure \yorse than the 
 disease. Neither is the idea of constituting the fund partly of coin and part- 
 ly of land, free from impediments. These two species of property do not, 
 for the most part, unite m the same hands. Will the moneyed man consent to 
 enter into a partnership with the land holder, by which the latter will share in 
 the profits which will be made by the money of the former? The money, it 
 is evident, will be the agent or efficient cause of the profits the land can 
 only be regarded as an additional security. Itjs not difficult to foresee, that 
 an union, on such terms, will not readily be formed. If the landholders are 
 to procure the money by sale or mortgage of a part of their lands, this they 
 can as well do when the stock consists wholly of money, as if it were to be 
 compounded of money and land. 
 
 To procure for the landholders the assistance of loans, is the great desi- 
 deratum. Supposing other difficulties surmounted, and a fund created, corn- 
 posed partly of coin and partly of land, yet the benefit contemplated could 
 only then be obtained, by the bank's advancing them its notes for the whole, 
 or part, jf the value ot the lands they had subscribed to the stock. If this 
 advance'was small, the relief aimed at would not be given; if it was large, 
 the quantity of notes issued would be a cause of distrust; and, if receivecfat 
 all, they would be likely to return speedily upon the bank for payment; 
 which, after exhausting its coin, might be under a necessity of turning its 
 lands into money, at any price that could be obtained for them, to the irre- 
 parable prejudice of the proprietors. 
 
 Considerations of public advantage suggest a further wish, which is ? that 
 the bank could be established upon principles that would cause the profits of 
 it to redound to the immediate benefit ol the State. This is contemplated 
 by many who speak of a national bank, but the idea seems liable to insupera- 
 ble objections. To attach full confidence to an institution of this nature, it 
 appears to be an essential ingredient in its structure, that it shall be under a 
 private not a public direction under the guidance of individual interest, not 
 of public policy; which would be supposed to be, and, in certain emergencies, 
 under a feeble or too sanguine administration, would really be, liable to being 
 too much influenced by public necessity. The suspicion of this would most 
 probably be a canker that would continually corrode the vitals of the credit 
 of the bank, and would be most likely to prove fatal in those sitaations in 
 which the public good would require that they should be most sound and 
 vigorous. It would, indeed, be little less than a miracle, should the credit 
 of the bank be at the disposal of the Government^ if, in a long series of time, 
 there was not experienced a calamitous abuse of it. It is true, that it would 
 
;3Q BANK OF THE UNITED STATES. 
 
 be (he real interest of the Government not to abuse it; its genuine policy, to 
 husband and cherish it with the most guarded circumspection, as an inesti- 
 mable treasure. But what government ever uniformly consulted its true in- 
 terests in opposition to the temptations of momentary exigencies? What 
 nation was ever blessed with a constant succession of upright and wise ad- 
 ministrators? 
 
 The keen, steady, and, as it were, magnetic sense of their ovyn interest, as 
 proprietors, in (he directors of a bank, pointing invariably to its true pole, 
 the prosperity of the institution, is the only security that can always be relied 
 upon lor a careful and prudent administration. It is, therefore, the only 
 basis on which an enlightened, unqualified, and permanent confidence can be 
 expected to be erected and maintained. 
 
 The precedents of the banks established in several cities of Europe, Am- 
 sterdam, Hamburgh, and others, may seem to militate against this position. 
 Without a precise knowledge of all the peculiarities of their respective con- 
 stitutions, it is difficult to pronounce how far this may be the case. That of 
 Amsterdam, however, which we best know, is rather under a municipal than 
 a governmental direction. Particular magistrates of the city, not officers of 
 the republic, have the management of it. It is also a bank of deposite, not 
 of loan, or circulation; consequently less liable to abuse, as well as less use- 
 ful. Its general business consists in receiving money for safe keeping, which, 
 if not called for within a certain time, becomes a part of its stock, and irre- 
 claimable. But a credit is given for it on the books of the bank, which, being 
 transferable, answers all the purposes of money. 
 
 The directors being magistrates of the city, and the stockholders in general 
 its most influential citizens, it is evident that the principle of private interest 
 must be prevalent in the management of the bank. And it is equally evi- 
 dent, that, from the nature of its operations, that principle is less essential to 
 it than to an institution constituted with a view to the accommodation of the 
 public and individuals, by direct loans and a paper circulation. 
 
 As far as may concern the aid of the bank, within the proper limits, a 
 good government has nothing more to wish for than it will always possess, 
 though the management be in the hands of private individuals. As the in- 
 titution, if rightly constituted, must depend for its renovation, from time to 
 time, on the pleasure of the government, it will not be likely to feel a dis- 
 position to render itself, by its conduct, unworthy of public patronage. The 
 government, too, in 4he administration of its finances, has it in its power to 
 reciprocate benefits to the bank, of not less importance than those which the 
 bank affords to the government, and which, besides, are never unattended 
 with an immediate and adequate compensation. Independent of these more 
 particular considerations, the natural weight and influence of a good govern- 
 ment will always go far towards procuring a compliance with its desires; and, 
 as the directors will usually be composed of some of the most discreet,?respect- 
 able, and well informed citizens, it can hardly ever be difficult to make them 
 sensible of the force of the inducements which ought to stimulate their exertions. 
 
 It will not follow, from what has been said, that the State may not be the 
 holder of a part of the stock of a bank, and consequently a sharer in the pro- 
 fits of it. It will only follow that it ought not to desire any participation in 
 the direction of it, and therefore ought not to own the whole or a principal 
 part of the stock: for, if the mass of the property should belong to the public, 
 and if the direction of it should be in private hands, this would be to commit 
 the interests of the State to persons not interested, or not enough interested 
 in their proper management. 
 
 There is one thing, however, which the Government owes to itself and to 
 the community, at least to all that part of it who are not stockholders, which 
 is, to reserve to itself a right of ascertaining, as often as may be necessary, 
 the state of the bank- excluding, however, all pretension to control. This 
 right forms an article in the primitive constitution of the Bank of North 
 America, and its propriety stands upon the clearest reasons. If the paper 
 of a bank is to be permitted to insinuate itself into all the revenues and re- 
 
CHARTER OF 1791. gj 
 
 ceipts of a country; if it is even to be tolerated as the substitute for gold and 
 silver, in all the transactions of business; it becomes, in either view, a national 
 concern of the first magnitude. As such, the ordinary rules of prudence re- 
 quire that the government should possess the means of ascertaining, when- 
 ever it thinks tit, that so delicate a trust is executed with fidelity and care. 
 A right of this nature is not only desirable, as it respects the government, 
 but it ought to be equally so to all those concerned in the institution, as an 
 additional title to public and private confidence, and as a thing which can 
 only be formidable to practices that imply mismanagement. The presump- 
 tion must always be, that the characters who would be entrusted with the 
 exercise of this right, on behalf of the government, will not be deficient in the 
 discretion which it may require; at least, the admitting cf this presumption 
 cannot be deemed too great a return of confidence for tnat very large portion 
 of it which the government is required to place in the bank. 
 
 Abandoning, therefore, ideas which, however agreeable or desirable, are 
 neither practicable nor safe, the following plan, for the constitution of a na- 
 tional bank, is respectfully submitted to the consideration of the House. 
 
 1. The capital stock of the bank shall not exceed ten millions of dollars, 
 divided into twenty -five thousand shares, each share being four hundred dol- 
 lars; to raise which sum, subscriptions shall be opened on the first Monday of 
 April next, and shall continue open until the whole shall be subscribed. 
 Bodies politic as well as individuals may subscribe. 
 
 2. The amount of each share shall be payable, one-fourth in gold and sil- 
 ver coin, and three-fourths in that part of the public debt which, according 
 to the loan proposed by the act making provision for the debt of the United 
 States, shall bear an accruing interest, at the time of payment, of six per cent, 
 per annum. 
 
 3. The respective sums subscribed shall be payable in four equal parts, as 
 well specie as debt, in suncs-ion, and at the distance of six calendar months 
 from each other; the first payment to bo made at the time of subscription. 
 If there shall be a failure in any subsequent payment, the party failing shall 
 lose the benefit of any dividend which may have accrued prior to the time for 
 making such payment, and during the delay of the same. 
 
 4. Ihe subscribers to the bank, and their successors, shall be incorporated, 
 and shall so continue, until the final redemption of that part of its stock which 
 shall consist of the public debt. 
 
 5. The capacity of the corporation to hold real and personal estate, shall be 
 limited to fifteen millions of dollars, including the amount of its capital or 
 original stock. The lands and tenements which it shall be permitted to hold, 
 shall be only such as shall be requisite for the immediate accommodation of the 
 institution; and such as shall have been bona fide mortgaged to it by way of 
 security, or conveyed to it in satisfaction of debts previously contracted, in 
 the usual course of its dealings, or purchased at sales upon judgments which 
 shall have been obtained for such debts. 
 
 (5. The totality of the debts of the company, whether by bond, bill, note, 
 or other contract, (credits for deposites. excepted) shall never exceed the 
 amount of its capital stock. In case of excess, the directors, under whose 
 administration it shall happen, shall be liable for it in their private or separate 
 capacities. Those who may have dissented, may excuse themselves from this 
 responsibility, by immediately giving notice of the fact, and their dissent, to 
 the President of the United States, and to the stockholders, at a general meet- 
 ing, to be called by the President of the Bank, at their request. 
 
 7. The company may sell or demise its lands and tenements, or may sell 
 the whole or any part of the public debt, whereof its stock shall consist; but 
 shall frade'm nothing except bills of exchange, gold and silver bullion, or in 
 the sale of goods pledged for money lent; nor shall take more than at the 
 rate of six per centum per annum, upon its loans or discounts. 
 
 8. No loan shall be made by the bank for the use, or on account of, the 
 Government of the United States, or of either of them, to an amount exceed- 
 
32 BANK OF THE UNITED STATES. 
 
 ing fifty thousand dollars, or of any foreign Prince or State, unless previously 
 authorized by a law of the United States. 
 
 9. The stock of the bank shall be transferable, according to such rules as 
 shall be instituted by the company in that behalf. 
 
 10. The affairs of the bank shall be under the management of twenty-five 
 directors, one of whom shall be the president; and there shall be, on the first 
 Monday of January, in each year, a choice of directors, by a plurality of suf- 
 frages of the stockholders, to serve for a year. The directors, at their first 
 meeting after each election, shall choose one of their number as president. 
 
 11. The number of votes to which each stockholder shall be entitled, shall 
 be according to the number of shares he shall hold, in the proportions follow- 
 ing, that is to say: For one share, and not more than two shares, one vote; 
 for every two shares above two, and not exceeding ten, one vote; for every 
 four shares above ten, and not exceeding thirty, one vote; for every six shares 
 above thirty, and not exceeding sixty, one vote; for every eight shares above 
 sixty, and not exceeding one hundred, one vote; and for every ten shares 
 above, one hundred, one vote; but no person, co-partnership, or body politic, 
 shall be entitled to a greater number than thirty votes. And, after the first 
 election, no share or shares shall confer a right of suffrage, which shall not 
 have been holden three calendar months previous to the day of election. 
 Stockholders actually resident within the United States, and none other, may 
 vote in the elections by proxy. 
 
 12. Not more than three-fourths of the directors in office, exclusive of the 
 president, shall be eligible for the next succeeding year. But the director 
 who shall be president at the time of an election, may always be re-elected. 
 
 13. None but a stockholder being a citizen of the United States, shall be 
 eligible as a director. 
 
 14. Any number of stockholcbrs, not less than sixty, who, together, shall 
 be proprietors of two hundred snares or upwards, shall have power, at any 
 time, to call a general meeting of the stockholders, for purposes relative to 
 the institution; giving at least six weeks' notice, in two public gazettes, of the 
 place where the bank is kept, and specifying in such notice the object of the 
 meeting. 
 
 15. In case of the death, resignation, absence from the United States, or 
 removal ot a director by the stockholders, his place may be filled by a new 
 choice for the remainder of the year. 
 
 16. No director shall be entitled to any emolument, unless the same shall 
 have been allowed by the stockholders at a general meeting. The stock- 
 holders shall make such compensation to the president, for his extraordinary 
 attendance at the bank, as shall appear to them reasonable. 
 
 17. Not less than seven directors shall constitute a board for the transac- 
 tion of business. 
 
 18. Every cashier or treasurer, before he enters on the duties of his office, 
 shall be required to give bond, with two or more sureties, to the satisfaction 
 of the directors, in a sum not less than twenty thousand dollars, with condi- 
 dition for his good behavior. 
 
 19. Half-yearly dividends shall be made of so much of the profits of the 
 bank as shall appear to the directors advisable; and, once in every three 
 years, the directors shall lay before the stockholders, at a general meeting, 
 for their information, an exact and particular statement of the debts which 
 shall have remained unpaid, after the expiration of the original credit, for a 
 period of treble the term of that credit, and of the surplus of profit, if any, 
 after deducting losses and dividends. 
 
 20. The bills and notes of the bank originally made payable, or which shall 
 have become payable, on demand, in gold and silver coin, shall be receivable 
 in all payments to the United States. 
 
 21. The officer at the head of the Treasury Department of the United 
 States shall be furnished, from time to time, as often as he may require, not 
 exceeding once a week, with statements of the amount of the capital stock of 
 the bank, and of the debts due to the same, of the moneys deposited therein. 
 
CHARTER OF 1791. 33 
 
 of the notes in circulation, and of the cash in hand; and shall have a right to 
 inspect such general accounts in the books of the bank, as shall relate to the 
 said statements; provided that this shall not be construed to imply a right of 
 inspecting the account of any private individual or individuals with the bank. 
 
 22. No similar institution shall be established by any future act of the 
 United States, during the continuance of the one hereby proposed to be es- 
 tablished. 
 
 23. It shall be lawful for the directors of the bank to establish offices 
 wheresoever they shall think fit, within the United States, for the purposes 
 of discount and deposite, only, and upon the same terms, and in the same 
 manner, as shall be practised at the bank, and to commit the management of 
 the said offices, and the making of the said discounts, either to agents spe- 
 cially appointed by them, or to such persons as may be chosen by the stock- 
 holders residing at the place where any such office shall be, under such agree- 
 ments, and subject to such regulations, as they shall deem proper, not being 
 contrary to law, or to the constitution of the bank. 
 
 24. And lastly, the President of the United States shall be authorized to 
 cause a subscription to be made to the stock of the said company, on behalf 
 of the United States, to an amount not exceeding two millions of dollars, to 
 be paid out of the moneys which shall be borrowed by virtue of either of the 
 acts, the one, entitled " An act making provision for the debt of the United 
 Strtes," and the other, entitled " An act making provision for the reduction 
 of the public debt;" borrowing of the bank an equal sum, to be applied to the 
 purposes for which the said moneys shall have been procured, reimbursable 
 in ten years, by equal annual instalments; or at any time sooner, or in any 
 greater proportions, that the Government may think tit. 
 
 The reasons for the several provisions contained in the foregoing plan, have 
 been so far anticipated, and will, for the most part, be so readily suggested by 
 the nature of those provisions, that any comments which need further be 
 made, will be both few and concise. 
 
 The combination of a portion of the public debt, in the formation of the 
 capital, is the principal thing of which an explanation is requisite. The chief 
 object of this is to enable me creation of a capital sufficiently large to be 
 the basis of an extensive circulation, and an adequate security for it. As has 
 been elsewhere remarked, the original plan of the Bank of North America 
 contemplated a capital of ten millions of dollars, which is certainly not too 
 broad a foundation for the extensive operations to which a national bank is 
 destined. But, to collect such a sum in this country, in gold and silver, into 
 one depository, may, without hesitation, be pronounced impracticable. Hence 
 the necessity of an auxiliary, which the public debt at once presents. 
 
 This part of the fund will be always ready to come in aid of the specie; it 
 will more and more command a ready sale; and can therefore expeditiously 
 be turned into coin, if an exigency of the bank should at any time require it. 
 This quality of prompt convertibility into coin, renders it an equivalent for 
 that necessary agent of bank circulation, and distinguishes it from a fund in 
 land, of which the sale would generally be far less compendious, and at great 
 disadvantage, v The quarter yearly receipts of interest will also be an actual 
 addition to the specie fund, during the intervals between them, and the half 
 yearly dividends of profits. The objection to combining land with specie, 
 resulting from their not being generally in possession of the same persons, 
 does not apply to the debt, which will always be found in considerable quan- 
 tity among the moneyed and trading people. 
 
 The debt composing part of the capital, besides its collateral effect in ena- 
 bling the bank to extend its operations, and consequently to enlarge its pro- 
 fits, will vproduce a direct annual revenue of six per centum from the Go- 
 vernment, which will enter into the half yearly dividends received by the 
 stockholders. \ 
 
 When the present price of the public debt is considered, and the effect 
 which its conversion into bank stock, inc9rporated with a specie fund, would, 
 in all probability, have to accelerate its rise to the proper point, it will easily 
 5 
 
34 BANK OF THE UNITED STATES. 
 
 be discovered that the operation presents, in its outset, a very considerable 
 advantage to those who may become subscribers; and from the influence 
 which that rise would have on the general mass of the debt, a proportional 
 benefit to all the public creditors, and, in a sense which has been more than 
 once adverted to, to the community at large. 
 
 There is an important fact which exemplifies the fitness of the public debt 
 for a bank fund, and which may serve to remove doubts in some minds on 
 this point: it is this, that the iJank of England, in its first erection, rested 
 wholly on that foundation. *> The subscribers to a loan to Government of one 
 million two hundred thousand pounds sterling, were incorporated as a bank, 
 of which the debt created by the loan, and the interest upon it, were the sole 
 fund. The subsequent augmentations of its capital, which now amounts to 
 between eleven and twelve millions of pounds sterling, have been of the same 
 nature. 
 
 The confining ol the right of the bank to contract debts to the amount of 
 its capital, is an important precaution, which is not to be found in the consti- 
 tution of the Bank of North America, and which, while the fund consists 
 wholly of coin, would be a restriction attended with inconveniences, but would 
 be free from any, if the composition of it should be such as is now proposed. 
 The restriction exists in the establishment of the Bank of England, and, as a 
 source of security, is worthy of imitation. The consequence of exceeding the 
 limit, there, is, that each stockholder is liable for the excess, in proportion to 
 his interest in the bank. When it is considered that the directors ovye their 
 appointments to the choice of the stockholders, a responsibility of this kind, 
 on the part of the latter, does not appear unreasonable; but, on the other hand, 
 it may be deemed a hardship upon those who may have dissented from the 
 choice. And there are many among us whom it might perhaps discourage 
 from becoming concerned in the institution. These reasons have induced the 
 placing of the responsibility upon the. directors by whom the limit prescribed 
 should be transgressed. 
 
 The interdiction of loans on account of the United States, or of any parti- 
 cular State, beyond the moderate sum specified, or of any foreign Power, will 
 serve as a barrier to Executive encroachments, and to combinations inauspi- 
 cious to the safety, or contrary to the policy of the Union. 
 
 The limitation of the rate of interest is dictated by the consideration, that 
 different rates prevail in different parts of the Union; and as the operations 
 of the bank may extend through the whole, some rule seems to be necessary. 
 There is room for a question, whether the limitation ought not rather to be to 
 five than to six per cent, as proposed. It may, ^vith safety.be taken for 
 granted, that the former rate would yield an ample dividend, perhaps as much 
 as the latter, by the extension which it would give to business. Ihe natural 
 effect of low interest is to increase trade and industry; because undertakings 
 of every kind can be prosecuted with greater advantage. This is a truth 
 generally admitted; but it is requisite toliave analyzed the subject in all its 
 relations, to be able to form a just conception of the extent ol that ettect. feucn 
 an analysis cannot but satisfy an intelligent mind, that the difference ot one 
 per cent, in the rate at which money may be had, is often capable ot making 
 an essential change for the better in the situation of any country or place. 
 
 Every thing, therefore, which tends to lower the rate of interest, is peculi- 
 arly worthy of the cares of legislators. And though laws, which violently sink 
 
 the legal rate of interest greatly below the market level are not to be com- 
 mended, because they are not calculated to answer their aim, yet, whatever 
 has a tendency to effect a reduction, without violence to the natural c 
 of things, ought to be attended to and pursued. Banks are among the means 
 most proper to accomplish this end; and the moderation of the rate at which 
 their discounts are made, is a material ingredient towards it; with which their 
 own interest, viewed on an enlarged and permanent scale, does not appear 1 
 
 L But, as the most obvious ideas are apt to have greater force than those 
 lich depend on complex and remote combinations, there would be danger 
 
CHARTER OF 1791. 35 
 
 that the persons, whose funds'must constitute the stock of the bank, would be 
 diffident of the sufficiency of the profits to be expected, if the rate of loans 
 and discounts were to be placed below the point to which they have been ac- 
 customed,- and might, on this account, be indisposed to embarking in the plan. 
 There is, it is true, one reflection, vyhich, in regard to men actively engaged 
 in trade, ought to be a security against this danger; it is this: that the ac- 
 commodations which they might derive in the way of their business, at a low 
 rate, would more than indemnify them for any difference in the dividend, 
 supposing even that some diminution of it were to be the consequence. But, 
 upon the whole, the hazard of contrary reasoning among the mass of moneyed 
 men, is a powerful argument against the experiment. The institutions of the 
 kind already existing add to the difficulty of making it. Mature reflection, 
 and a large capital, may, of themselves, lead to the desired end. 
 
 The last thing which requires any explanatory remark is the authority pro- 
 posed to be given to the President to subscribe the amount of two millions 
 of dollars on account of the public. The main design of this is to enlarge 
 the specie fund of the bank, and to enable it to give a more early extension 
 to its operations. Though it is proposed to borrow with one hand what is 
 lent with the other, yet the disbursement of what is borrowed will be pro- 
 gressive, and bank notes may be thrown into circulation instead of the gold 
 and silver. Besides,"1;n^re is to be an annual reimbursement of a part of the 
 sum borrowed, which will finally operate as an actual investment of so much 
 specie. In addition to die inducements to this measure, which result from 
 the general inti'iv-i of the Government to enlarge the sphere of the utility of 
 the qank, there is this more particular consideration, to wit: that, as far as 
 the dividend on the stock shall exceed the interest paid on the loan, there is 
 a positive profit. 
 
 The Secretary begs leave to conclude with this general observation: That, 
 if the Bank of North America shall come forward with any propositions which 
 have Jor their object the engrafting upon that institution, the characteristics 
 whicfi shall appear to the Legislature necessary to the due extent and safety 
 of a national bank, there are, in his judgment, weighty inducements to giving 
 every reasonable facility to the measure. Not only the pretensions of that 
 institution, from its original relation to the Government of the United States, 
 am? from the services it has rendered, are such as to claim a disposition favora- 
 ble to it, if those who are interested in it are willing, on their part, to place 
 it on a footing satisfactory to the Government, and equal to the purposes of a 
 Bank of the United States, but its co-operation would materially accelerate 
 the accomplishment of the great object; and the collision, which might other- 
 wise arise, might, in a variety of ways, prove equally disagreeable and inju- 
 rious. The incorporation or union here contemplated, may be effected in 
 different modes, under the auspices of an act of the United States, if it shall 
 be desired by the Bank of North America, upon terms which shall appear 
 expedient to the Government. 
 
 All which is humbly submitted. 
 
 ALEXANDER HAMILTON, 
 Secretary of the Treasury. 
 
 TREASURY DEPARTMENT, December 13, 1790. 
 
 IN SENATE, December 23, 1790. 
 
 On the reception of the copy of the said report, in the Senate, it was, on 
 motion, 
 
 Ordered, That Messrs. Strong, of Massachusetts, Morris, of Pennsylvania, 
 Schuyler, of New York, Butler, of South Carolina, and Ellsworth, of Con- // 
 necticut, be a committee to take into consideration the report of the Secre- / / 
 tary of the Treasury, upon the plan of a national bank, and to prepare a bill 
 upon that subject. 
 
 On the 3d of January, 1791, Mr. Strong, from the said committee, reported 
 a bill " to incorporate the subscribers to the bank of ." 
 
3(5 BANK OF THE UNITED STATES. 
 
 The history of this bill, on its passage through the Senate, is to be learnt 
 from one source only the journals of that body. Its debates and proceed- 
 ings were not then, as now, open to the public. 
 
 From the journals, howevei> we learn that, on the 6th, 10th, llth, and 12th 
 days of January, 1791, the bill was under consideration, and on the 13th of 
 January it was agreed to fill the blank in the title with these words: " the 
 United States of America." 
 
 A motion was made to limit the term of incorporation to seven years, and 
 another to extend it to March 4th, 1815. On this latter motion, the yeas and 
 nays were: 
 
 YEAS Messrs. Bassett, Dickinson, Ellsworth, Elmer, Johnson, King-, Langdon, 
 Morris, Read, Schuyler, and Strong 11. 
 
 NATS Messrs. Butler, Few, Foster, Hawkins, Henry, Johnston, Izard, Maclay r 
 Monroe, and Wingate 10. 
 
 So it passed in the affirmative. 
 
 A motion was made to subjoin to the last clause agreed to, as follows: 
 " Provided^ nevertheless, that nothing herein contained shall be construed 
 to exclude the right of amending the same, on giving twelve months' notice y 
 from and after the first of January, 1800." 
 
 On the 1 4th of January, the question being taken on this amendment, it 
 passed in the negative. 
 
 On motion, it was agreed to reconsider the term of incorporation agreed to 
 yesterday, and to limit it to the 4th of March, 1811. 
 
 On the 18th of January, the bill being under consideration, it was ordered 
 that it be recommitted tor further amendments; and Mr. Strong, from the 
 committee to whom it was referred, reported sundry amendments; which 
 were agreed to. 
 
 On the 19th, a motion being made to expunge the 12th section, to w r itt 
 " And be it further enacted, That no other bank shall be established, by any 
 future law of the United States, during the continuance of the corporation 
 hereby created, for which the faith of the United States is hereby pledged," 
 it passed in the negative. 
 
 20th January, 1791. "On motion to reconsider the term of incorporation, 
 and limit it to the year 1801, instead of 1811," the vote was as follows: . 
 
 YEAS Messrs. Butler, Few, Gunn, Hawkins, Izard, and Monroe 6. 
 
 NATS Messrs. Bassett, Dalton, Dickinson, Ellsworth, Elmer, Foster, Johnson, 
 King, Langdon, Maclay, Morris, Read, Schuyler, Stanton, Strong, and Wingate 16. 
 
 On motion to expunge the twelfth section, quoted above, it passed in the 
 negative. 
 
 Whereupon, 
 
 Resolved, That this bill do pass; that the title of it be, "An act to incor- 
 porate the subscribers to the Bank of the United States." 
 
 The bill was then transmitted to the House of Representatives for concur- 
 rence. 
 
 HOUSE OF REPRESENTATIVES. 
 
 The bill to incorporate the subscribers to the Bank of the United States 
 was, on the 21st of January, read a first and second time, and committed to 
 a Committee of the Whole House. 
 
 On the 31st, the House resolved itself into a Committee of the Whole, 
 (Mr. Boudinot in the chair) and the bill was read by paragraphs; and no 
 amendments being offered, the chairman reported it to the House, which voted 
 that it should be read the third time on the succeeding day. 
 
 FEBRUARY 1, 1791. 
 
 \fter the bill was read the third time, Mr. Smith, of South Carolina, hav- 
 ing moved that the bill be recommitted to a Committee of the Whole House, 
 it was determined by ayes and noes, in the negative, and it was 
 
 Ordered, That the bill do lie on the table. 
 
CHARTER OF 1791, 
 
 DEBATE ON THE MOTION OF MR. SMITH, OF SOUTH CAROLINA, TO 
 RECOMMIT THE BILL. 
 
 FEBRUARY 1, 1791. 
 
 Mr. SMITH, of South Carolina, observed, that the bill being taken up rather 
 unexpectedly yesterday, gentlemen did not appear prepared to discuss the 
 subject; it, therefore, was suffered to be read in Committee of the Whole, and 
 passed to the third reading, in his opinion rather informally, as the mem- 
 bers were, thereby, deprived of giving their sentiments in the usual manner, 
 on a bill of the greatest importance. 
 
 He thought it susceptible of various amendments. [The SPEAKER having 
 observed that the bill, agreeable to the rules of the House, could not be amend- 
 ed without being recommitted,] Mr. Smith moved that the bill should be re- 
 committed for the purpose of making sundry alterations and removing objec- 
 tions which he thought the bill liable to. He then enumerated several objec- 
 tions. Those who are to receive the subscriptions, he said, are not obliged 
 to give any bonds for their fidelity. He thought the clause which excluded 
 foreigners from voting by proxy exceptionable. And the time in which sub- 
 scriptions are to be received, he thought too contracted. 
 
 Mr. JACKSON said he was in favor of the motion for a recommitment, but 
 not for the reasons offered by the gentleman from South Carolina. He was, 
 he said, opposed to the principles of the bill altogether. He then adverted to 
 the situation of the United States, and observed that it was so different from 
 that of Great Britain, at the time the bank was established in that country, 
 that no reason in favor of the institution could be deduced from thence. He 
 adverted to the argument arising from the facility which banks afford, of an- 
 ticipating the public resources in cases of emergency. This idea of anticipa- 
 tions he reprobated, as tending to involve the country in debt, and an end- 
 less labyrinth of perplexities. This plan of a National Bank, said he, is cal- 
 culated to benefit a small part of the United States the mercantile interest 
 only 5 the farmers, the yeomanry of the country, will derive no advantage 
 from it. as the bank bills will not circulate to the extremities of the Union. 
 He said he had never seen a bank bill in the State of Georgia; nor will they 
 ever benefit the farmers of that State, or of New Hampshire. He urged that 
 there was no necessity for instituting a new bank; there is one already esta- 
 blished in this city, under the style of the Bank of North America. This pro- 
 posed institution is an infringement of the charter of that bank, which cannot 
 be justified. He urged the unconstitutional of the plan; called it a mo- 
 nopoly, such an one as contravenes the spirit of the constitution a monopoly 
 of a very extraordinary nature a monopoly of the public moneys for the bene- 
 fit of the corporations to be created. He then read several passages from the 
 Federalist, which, he said, were directly contraiy to the assumptions of the 
 power proposed by the bill. He hoped, therefore, it would be recommitted, 
 and he could not help hoping, also, that it would be deferred to the next 
 session. 
 
 Mr. LAWRENCE observed, that the friends of the institution proposed, had 
 been unjustly charged with precipitating the bill; but, he said, it had long 
 been in the hands of the members; they have had time to consider it; the 
 usual forms have been observed in its progress, thus far, and if those who are 
 opposed to the bill did not see proper to come forward with their objections, it 
 surely is their own fault, and the advocates of the bill are not justly chargea- 
 ble with precipitancy. He then particularly replied to the objections offered 
 by Mr. Smith, of South Carolina, and after considering them, said that those 
 objections did not, in his opinion, constitute sufficient reasons to induce a 
 recommitment of the bill. He then noticed the constitutional objections of 
 Mr. Jackson, and said the Government of the United States is vested, by the 
 constitution, with the power of borrowing money, and, in pursuance of this 
 
38 BANK OF THE UNITED STATES. 
 
 idea, they have a right to create a capital by which they may, with greater 
 facility, cany the powers of borrowing, on any emergency, into effect. Under 
 the late confederation, the Pennsylvania bank, called the Bank of North 
 America, was instituted. He presumed that it would not be controverted, 
 that the present Government is vested with powers equal to those of the late 
 confederation. He said that he had no doubt its operations would benefit, 
 not only the centre, but the extremities also, of the Union. The commer- 
 cial, mechanical, and agricultural interests of the United States, are so com- 
 bined, that one cannot be benefitted without benefiting the other. He con- 
 cluded by observing that he thought the Legislature of the United States could 
 not better answer the purposes ot their appointment, than by passing this bill. 
 He hoped, therefore, it would not be recommitted, but that it would now 
 pass. 
 
 Mr. LEE observed, that, having been confined by sickness, he was preclud- 
 ed from attending the House yesterday; but, sick as he was, had he supposed 
 there was a prospect of a bill of such magnitude and importance passing, with- 
 out a discussion of its principles, he certainly would have attended, and offered 
 his objections to various parts of it, which he thought very exceptionable. He 
 hoped, therefore, it would now be recommitted, that a bill which is so une- 
 qual and so partial may undergo a thorough discussion. 
 
 Mr. TUCKER was in favor of recommitment. He acknowledged that those 
 who had their objections to the bill were certainly blameable for not coming 
 forward with them yesterday. He then stated sundry objections to the bill. 
 The time allowed to receive the subscriptions, he said, is too short, arid will 
 benefit those only in the vicinity of the bank. The clause which authorizes 
 the loaning $100,000 to the Government, without express provision by law, 
 he thought exceptionable, as the Executive will be able, by this means, to 
 borrow, at any time, without being authorized, to almost any amount, of the. 
 bank. The loan of $2,000,000, by the United States, to the bank, he objected 
 to, as diverting that sum from the particular object for which it was borrowed. 
 There is no appropriation, said he, of the half yearly dividend of profits ac- 
 cruing; to the United States, which, he observed, was a very essential defect. 
 Mr. Tucker stated other objections as reasons fora recommitment. 
 
 Mr. WILLIAMSON was in favor of the recommitment, to give those who say 
 thev have not had an opportunity of offering their objections, time to do it; 
 and if the motion is not agreed to, he should not give his vote for the bill. 
 He then adverted to the objections deduced from the constitution, and ex- 
 plained the clause respecting monopolies, as referring altogether to commer- 
 cial monopolies. 
 
 Mr. SHERMAN objected to the recommitment. He said, that, though the 
 bill could not be amended without its being recommitted, yet it was open to 
 discussion and objection, previous to taking a vote on its passing. He did not 
 think the objections offered, afforded sufficient reasons for a recommitment. 
 He replied to the 9bservations offered by several gentlemen who had spoken 
 in favor of the motion. 
 
 Mr. GERRY expressed his surprise at the observations of the gentlemen who 
 had neglected to offer their objections to the bill before, and said it could only 
 be imputed to their own neglect, and not to any precipitancy on the part of 
 the friends of the bill. Mr. Gerry noticed the several objections which had 
 been offered, and said, if nothing more important could be offered, he thought 
 it unjustifiable in the House to go into a committee. 
 
 Mr. MADISON observed, that at this moment it was not of importance to 
 determine how it has happened that the objections which several gentlemen, 
 now say they have to oner, against the bill, were not made at the proper 
 time; it is sufficient for them, if the candor of the House should lead them 
 now to recommit the bill, that, in a Committee of the Whole, they may have 
 an opportunity to offer their objections. 
 
CHARTER OF 1791. 
 
 Mr. AMES replied to Mr. Madison. He said he did not cone .,. 
 
 appeal now made to the candor of the House was in point. The gentlemen 
 who object to the bill had an opportunity to offer their objections; the cus- 
 tomary forms have been attended to, and the whole question for recommit- 
 ment turns on the force of the objections which are now offered to the ej 
 ral principles of the bill, altogether; the candor of the House, lie conceivi 
 was entirely out of the question, and therefore not to be appealed to; but the 
 justice due to their constituents in the proper discharge of the duty reposed in 
 them. He said it appeared to him absurd togo into a Committee of the Whole. 
 to determine whether the bill is constitutional or not; if it is unconstitutional, 
 that amounts to a rejection of it altogether. 
 
 Mr. MADISON thought there was the greatest propriety in discussing a con - 
 stitutional question in the Committee of the Whole. 
 
 Mr. STONE and Mr. GILES were in favor of recommitment; they objected 
 to the unconstitutionality of the bill, and to several of its particular clauses. 
 
 Mr. VIXING said he thought it was a subject of congratulation that the bill 
 was in its present situation; it had happily passed to the third reading with- 
 out that tedious discussion which bills usually receive. The subject has 
 been a considerable time before the House, and the gentlemen have had time 
 to contemplate it. The bill is now in the stage to which gentlemen very usu- 
 ally reserve themselves to state their objections at large; he hoped they would 
 now do it. He was not perfectly satisfied as to the constitutional point; he 
 therefore hoped gentlemen would slate their objections, that those who are 
 satisfied on that point, may otter their reasons. 
 
 Mr. BOUDINOT stated the process of the business yesterday. He observed 
 he had then the honor to be in the chair; he had reau the bill very distinctly 
 and deliberately, with proper pauses; he thought that the fullest opportunity 
 had been offered for gentlemen to come forward with their objections; he was 
 opposed to the recommitment, as it would, he feared, issue in a defeat of the 
 bill, this session. He had one difficulty, however, respecting the unconstitu- 
 tionality of the bill; this he hoped to have removed, and he noped that a full 
 discussion of its general principles would take place. 
 
 FEBRUARY 2, 1791. 
 
 On the question, " Shall the bill pass ?" the following debate took place. 
 
 Mr. MADISON began with a general review of the advantages and disadvan- 
 tages of banks. The former he stated to consist in, First. The aids they 
 afford to merchants, who can thereby push their mercantile operations far- 
 ther, with the same capital. Second. The aids to merchants in paying punc- 
 tually, the customs. Phird. Aids to the Government, in complying punctu- 
 ally with its engagements, when deficiencies and delays happen in the reve- 
 nue. Fourth. In diminishing usury. Fifth. In saving the wear of gold and 
 silver, kept in the vaults, and represented by notes. Sixth. In facilitating 
 occasional remittances from different places where notes happen to circulate. 
 The effect of the proposed bank in raising the value of stock, he thought, had 
 been greatly overrated. It no doubt would raise that of the stock subscribed 
 into the bank, but could have little effect on stock in general, as the interest 
 on it would remain the same, and the quantity taken out of the market would 
 be replaced by the bank stock. 
 
 The principal disadvantage consisted in, First. Banishing the precious 
 metals, by substituting another medium to perform their office. This effect 
 was inevitable. It was admitted by the most enlightened patrons of banks, 
 particularly by Smith on the Wealth of Nations. The common answer to the 
 objection was, that the money banished was only an exchange for something 
 equally valuable, that would be imported in return. He admitted the weight 
 of this observation, in general, but doubted ^vhether, in the present habiis* of 
 this country, the return would not be in articles of no permanent use to it. 
 
40 BANK OF THE UNITED STATES. 
 
 Second. Exposing the public and individuals to all the evils of a run on the 
 bank, which would be particularly calamitous in so great a country as this, 
 and might happen from various causes, as false rumors, bad management of 
 the institution, an unfavorable balance of trade, from short crops, &c. It was 
 proper to be considered, also, that the most important of the advantages would 
 be better obtained by several banks, properly distributed, than by a single one. 
 The aids to commerce could only be afforded at, or very near, the seat of the 
 bank. The same was true of aids to merchants in the payment of customs. 
 Anticipations of the Government would, also, be most convenient at the 
 different places where the interest of the debt was to be paid. The case in 
 America was different from that in England; the interest there was all due 
 at one place, and the genius of the monarchy favored the concentration of 
 wealth and influence at the metropolis. 
 
 He thought the plan liable to other objections; it did not make so good a 
 bargain for the public as was due to its interests. The charter to the Bank 
 of England had been granted only for eleven years, and was paid for by a 
 loan to the Government, on terms better than could be elsewhere got. Every 
 renewal of the charter had, in like manner, been purchased; in some in- 
 stances at a very high price. The same had been done by the banks of Genoa, 
 Naples, and other like banks of circulation. The plan was unequal to the 
 public creditors; it gave an undue preference to the holders of a particular 
 demonination of the public debt; and to those at, and within reach of, the 
 seat of Government. If the subscriptions should be rapid, the distant holders 
 of paper would be excluded altogether. 
 
 In making these remarks on the merits of the bill, he had reserved to him- 
 self, he said, the right to deny the authority of Congress to pass it. He had 
 entertained this opinion from the date of the constitution. His impressions 
 might, perhaps, be the stronger, because he well recollected that a power to 
 grant charters of incorporation had been proposed in the general convention, 
 and rejected. Is the power of establishing an incorporated bunk among the 
 powers vested by the constitution, in the Legislature of the United States? 
 This is the question to be examined. 
 
 After some general remarks on the limitations of all political power, he took 
 notice of the peculiar manner in which the Federal Government is limited. 
 It is not only a general grant out of which particular powers are excepted; it 
 is a grant of particular powers, leaving the general mass in other hands. So 
 it had been understood by its friends and its foes; and so it was to be inter- 
 preted. 
 
 As preliminaries to a right interpretation, he laid down the following rules: 
 
 An interpretation that destroys the very characteristic of the Government, 
 cannot be just. 
 
 Where a meaning is clear, the consequences, whatever they may be, are 
 to be admitted; where doubtful, it is fairly triable by its consequences. 
 
 In controverted cases, the meaning of the parties to the instrument, if to be 
 collected by reasonable evidence, is a proper guide. 
 
 Contemporary and concurrent expositions are a reasonable evidence of the 
 meaning of the parties. 
 
 In admitting or rejecting a constructive authority, not only the degree of its 
 incidentally to an express authority is to be regarded, but the degree of its 
 importance also; since on this will depend the probability or improbability ot 
 its being left to construction. 
 
 Reviewing the constitution with an eye to these positions, it was not possi- 
 ble to discover in it the power to incorporate a bank. The only clauses under 
 which such power could be pretended, was, either, 
 
 tirit. The power to lay and collect taxes to pay the debts and provide 
 for the common defence and general welfare; or, 
 
 Second. The power to borrow money on the credit of the United States; or, 
 
 Third. The powers to pass all laws necessary and proper to carry into 
 execution those powers. 
 
CHARTER OF 1791. 41 
 
 The bill did not come within the first power. It laid no tax to pay the 
 debts, or provide for the general welfare. It laid no tax whatever. It was 
 altogether foreign to the subject. 
 
 No argument could be drawn from the terms "common defence and general 
 welfare." The power as to tliese general purposes was limited to acts laying 
 taxes for them; ami the general purposes themselves were limited and ex- 
 plained by the particular enumerations subjoined. To understand these terms 
 in any sense that would justify the power in question, would give to Congress 
 an unlimited power; would render nugatory the enumeration of particular 
 powers; would supersede all the powers reserved to the State Governments. 
 These terms are copied from the articles of confederation: had it ever been 
 pretended that they were to be understood otherwise than as here explained? 
 It had been said, that 4i general welfare" meant cases in which a general 
 power might be exercised by Congress, without interfering with the power of 
 the States; and that the establishment of a National Bank was of this sort. 
 There were, he said, several answers to this novel doctrine. 
 
 First. The proposed bank would interfere, so as indirectly to defeat a State 
 bank at the same place. 
 
 Second. It would directly interfere with the rights of States to prohibit, as 
 well as to establish, banks, and the circulation of T}ank notes. He mentioned 
 a law of Virginia, actually prohibiting the circulation of notes payable to 
 bearer. 
 
 TTiird. Interference with the powers of the States was no constitutional 
 criterion of the power of Congress. If the power was not given, Congress 
 could not exercise it; if given, they might exercise it, although it should inter- 
 fere with the laws, or even the constitution, of the States. 
 
 Fourth. If Congress could incorporate a bank, merely because the act would 
 leave the States free to establish banks also, any other incorporation might be 
 made by Congress. They could not incorporate companies of manufacturers, 
 or companies for cutting canals, or even religious societies, leaving similarin- 
 corporations by the States, like State banks, to themselves; Congress might 
 even establish religious teachers in every parish, and pay them out of the 
 treasury of the United States, leaving other teachers unmolested in their 
 functions. These inadmissible consequences condemned the controverted 
 principle. 
 
 The case of the bank, established by the former Congress, had been cited 
 as a precedent. This was known, he said, to have been the child of neces- 
 sity. It never could be justified by the regular powers of the articles of con- 
 federation. Congress betrayed a consciousness of this, in recommending to 
 the States to incorporate the bank also. They did not attempt to protect the 
 bank notes, by penalties against counterfeiters. These were reserved wholly 
 to the authority of the States. 
 
 The second clause to be examined is that which empowers Congress to 
 borrow money. 
 
 Is this a bill to bornny money? It does not borrow a shilling. Is there any 
 fair construction by which the bill can be deemed an exercise of the power to 
 borrow money? '1 he obvious meaning of the power to borrow money, is, that 
 accepting from, and stipulating payments to, those who are able and willing 
 to lend. 
 
 To say that the power to borrow involves the power of creating the ability, 
 where there may be the will to lend, is not only establishing a dangerous prin- 
 ciple, as will be immediately shown, but is as forced a construction, as to say, 
 that it involves the power of compelling ^the will, where there maybe the 
 ability to lend. 
 
 The third clause is that which gives the power to pass all laws necessary 
 and proper to execute the specified powers. 
 
 Whatever meaning this clause may have, none can be admitted that would 
 give an unlimited discretion to Congress. 
 
42 BANK OF THE UNITED STATES. 
 
 Its meaning must, according to the natural and obvious force of the terms 
 and the context, be limited to means necessary to the end, and incident to the 
 nature, of the specified powers. 
 
 The clause is, in fact, merely declaratory of what would have resulted, by 
 unavoidable implication, as the appropriate, as it were, technical means of 
 executing those powers. In this sense it had been explained, by the friends 
 of the constitution /and ratified by the State conventions. 
 
 The essential characteristic of the Government, as composed of limited and 
 enumerated powers, would be destroyed, if, instead of direct and (incidental 
 means, any means could be used, which, in the language of the preamble to 
 the bill, might be conceived to be conducive to the successful conducting of 
 the finances, or might be conceived to tend to give facility to the obtaining of 
 loans. He urged an attention to the diffuse and ductile terms which had been 
 found requisite to cover the stretch of power contained in the bill. He com- 
 pared them with the terms necessary and proper, used in the constitution, and 
 asked whether it was possible to view the two descriptions as synonymous, or 
 the one as a fair and safe commentary on the other. 
 
 If, proceeded he, Congress, by virtue of the power to borrow, can create 
 th means of lending, and, in pursuance of these means, can incorporate a 
 bank, they may do any thing whatever creative of like means. 
 
 The East India Company has been a lender to the British Government, as 
 well as the Bank, and the South Sea Company is a greater creditor tnan 
 either. Congress may then incorporate similar companies in the United 
 States, and that, too, not under the idea of regulating trade, but under that 
 of borrowing money. 
 
 Private capitals are the chief resources for loans to the British Government. 
 Whatever these may be conceived to favor the accumulation of capital, may 
 be done by Congress. They may incorporate manufacturers. They may give 
 monopolies in every branch of domestic industry. 
 
 If, again, Congress, by virtue of the power to borrow money, can create the 
 
 ability to lend, they may, by virtue of the power to levy money, create the 
 ability to pay it. The ability to pay taxes depends on the general wealth of 
 the society, and this, on the general prosperity of agriculture, manufactures, 
 
 id commerce. Congress may then give bounties, and make regulations 
 
 11 these objects. 
 
 The States have, it is allowed on all hands, a concurrent right to lav 
 
 )llect taxes. This power is secured to them, not by its being expressly 
 
 and commerce. Congress may then give bounties, and make regulations on 
 all these objects. 
 
 The States have, it is allowed on all hands, a concurrent right to lav and 
 collect taxes. This power is secured to them, not by its being expressly re- 
 served, but by its not being ceded by the constitution. The reasons for the 
 bill cannot be admitted, because they would invalidate that right; why may 
 it not be conceived by Congress, that a uniform and exclusive imposition of 
 taxes would not, less than the proposed bank, be conducive to the successful 
 conducting of the national finances, and tend to give facility to the obtaining 
 of a revenue for the use of the Government? 
 
 The doctrine of implication is always a tender one. The| danger of it has 
 been felt in other Governments. The delicacy was felt in the adoption of 
 our own; the danger may also be felt, if we do not keep close to our chartered 
 authorities. 
 
 Mark the reasoning on which the validity of the bill depends. To borrow 
 money is made the end, and the accumulation of capital implied as the means. 
 The accumulation of capital is, then, the end, and a bank implied as the 
 means. The bank is then the end, and a charter of incorporation, a monopoly, 
 capital punishments, &c. implied as the means. 
 
 If implications, thus remote, and thus multiplied, can be linked together, a 
 chain may be formed, that will reach every object of legislation, every object 
 within the whole compass of political economy. 
 
 The latitude of interpretation required by the bill is condemned by the rule 
 furnished by the constitution itself. 
 
 Congress have power "to regulate the value of money," yet it is expressly 
 added, not left to be implied, that counterfeiters may be punished. They 
 have the power "to declare war," to which armies are more incident than 
 
CHARTER OF 1791. 43 
 
 incorporated banks to borrowing, yet it is expressly added, the power " to 
 raise and support armies;" and to this again, the express power, " to make 
 rules and regulations for the government of armies" a like remark is appli- 
 cable to the powers as to a navy. 
 
 The regulation and calling out of the militia are more appurtenant to war* 
 than the proposed bank to borrowing; yet the former is not left to construc- 
 tion. 
 
 The very power to borrow money is a less remote implication from the 
 power of war, than an incorporated monopoly bank from the power of bor- 
 rowing yet the power to borrow is not leu to implication. 
 
 It is not pretended, that every insertion or omission in the constitution is 
 the effect of systematic attention. This is not the character of any human 
 work, particularly the work of a body of men. The example cited, with others 
 that might be added, sufficiently inculcate, nevertheless, a rule of interpre- 
 tation very different from that on which the bill rests. They condemn the 
 exercise of any power, particularly a great and important power, which is not 
 evidently and necessarily involved in an express power. 
 
 It cannot be denied that the power proposed to be exercised, is an import- 
 ant power. 
 
 As a charter of incorporation, the bill creates an artificial person, previously 
 not existing in law. It confers important civil rights and attributes, which 
 could not otherwise be claimed. It is, although not precisely similar, at least 
 equivalent to the naturalization of an alien, by whicn certain new civil char- 
 acters are acquired by him. Would Congress nave had the power to natural- 
 ize, if it had not been expressly given? 
 
 In the power to make by-laws, the bill delegated a sort of legislative 
 power, which is unquestionably an act of a high and important nature. He 
 took notice of the only restraint on the by-laws, that they were not to be 
 contrary to the law and the constitution of the bank, and asked, what law was 
 intended? If the law of the United States, the scantiness of their code would 
 give a power, never before given to a corporation, and obnoxious to the States, 
 whose laws would then be superseded, not only by (he laws of Congress, but 
 by the by-laws of a corporation within their own jurisdiction. If the law in- 
 tended was the law of the State, then the State might make laws that would 
 destroy an institution of the United States. 
 
 The bill gives a power to purchase and hold lands: Congress could not 
 purchase lands within a State, " without the consent of its Legislature." How 
 could they delegate a power to others which they did not possess themselves? 
 
 It takes from our successors, who have equal rights with ourselves, and 
 with the aid of experience will be morecapable of/leciding on the subject, 
 an opportunity of exercising that right -for an immoderate term. 
 
 It takes from our constituents the opportunity of deliberating on the untried 
 measure, although their hands ate also to be tied by it, for the same term. 
 
 It involves a monopoly which effects the equal rights of every citizen. 
 
 It leads to a penal regulation, perhaps capital punishment one of the most 
 solemn acts of sovereign authority. 
 
 From this view of the power of incorporation exercised in the bill, it never 
 could be deemed an accessory or subaltern power, to be deduced by implica- 
 tion, as a means of executing another power. It was in its nature a distinct, 
 and independent, and substantive prerogative, which, not being enumerated in 
 the constitution, could never have been meant to be included in it, and, not 
 being included, could never be rightfully exercised. 
 
 He had adverted to a distinction, which he said had not been sufficiently 
 kept in view, between a power necessary and proper for the Government or 
 Union, and a power necessary for executing the enumerated powers in the 
 latter case; the powers included in each of the enumerated powers were not 
 expressed, but to be drawn from the nature of each. In the former, the pow- 
 ers composing the Government were expressly enumerated. This constituted 
 the peculiar nature of the Government; no power, therefore, not enumerated, 
 could be inferred from the general nature of Government. Had the power of 
 
44 BANK OT THE UNITED STATES. 
 
 making treaties, for example, been omitted, however necessary it might have 
 been, the defect could only have been lamented, or supplied by an amend- 
 ment of the constitution. 
 
 But the proposed bank could not even be called necessary to the Govern- 
 ment; at most, it could be but convenient. Its uses to the Government could 
 be supplied by keeping the taxes a little in advance; by loans from indivi- 
 duals; by the other banks over which the Government would have equal com- 
 mand, nay, greater, as it may grant or refuse to these the privilege, made a 
 free and irrevocable gift to the proposed bank, of using their notes in the fede- 
 ral revenue. 
 
 He proceeded next to the contemporary expositions given to the constitution* 
 
 The defence against the charge founded on the want of a bill of rights, pre- 
 supposed, he said, that the powers not given, were retained; and that those 
 given were not to be extended by remote implication. On any other suppo- 
 sition, the power of Congress to abridge the freedom of the press or the rights 
 of conscience, &c. could not have been disproved. 
 
 The explanations in the State conventions all turned on the same funda- 
 mental principle, and on the principle, that the terms necessary and proper, 
 gave no additional powers to those enumerated. [Here he read sundry pas- 
 sages, from the debates of the Pennsylvania, Virginia, and North Carolina 
 conventions, showing the ground on which the constitution had been vindi- 
 cated by its principal advocates against a dangerous latitude of its powers, 
 charged on it by its opponents. ] He did not undertake to vouch for the accu- 
 racy or authenticity of the publications which he quoted. He thought it proba- 
 ble that the sentiments delivered might, in many instances, have been mis- 
 taken, or imperfectly noted; but the complexion of the whole, with what he 
 himself, and many others must recollect, fully justified the use he had made 
 of them. 
 
 The explanatory declarations and amendments accompanying the ratifica- 
 tions of the several States, formed a striking evidence, wearing me same com- 
 plexion. He referred those who might doubt, to the several acts of ratifica- 
 tion. 
 
 The explanatory amendments, proposed by Congress themselves,jit least, 
 would be good authority with them; all these annunciations of power pro- 
 ceeded on a rule of construction excluding the latitude now contended for. 
 These explanations were the more to be respected, as they had not only been 
 proposed by Congress, but ratified by nearly three-fourths of the States. He 
 read several of the articles proposed, remarking particularly on the llth and 
 12th; the former, as guarding against a latitude of interpretation the latter 
 as excluding every source of power not within the constitution itself. 
 
 With all this evidence of the sense in which the constitution was under- 
 stood and adopted, will it not be said, if the bill should pass, that its adoption 
 was brought about by one set of arguments, and that it is now administered un- 
 der the influence oi another set? And this reproach will have the keener sting, 
 because it is applicable to so many individuals concerned in both the adoption 
 and administration. 
 
 In fine, if the power were in the constitution, the immediate exercise of it 
 cannot be essential; if not there, the exercise of it involves the guilt of usurpa- 
 tion, and establishes a precedent of interpretation, levelling all the barriers 
 which limit the powers of the General Government and protect those of the 
 State governments. If the point be doubtful only, respect for ourselves, 
 who ought to shun the appearance of precipitancy and ambition; respect for 
 our successors, who ought not lightly to be deprived of the opportunity of 
 exercising the rights of legislation; respect for our constituents, who have 
 had no opportunity of making known their sentiments, and who are themselves 
 to be bound down to the measure for so long a period; all these considerations 
 require that the irrevocable decision shouluat least be suspended until another 
 session. 
 
 It appeared, on the whole, he concluded, that the power exercised by the 
 bill was condemned by the silence of the constitution; was condemned by the 
 
CHARTER OF 1791, 45 
 
 rule of interpretation, arising out of the constitution; was condemned by its 
 tendency to destroy the main characteristic of the constitution; was con- 
 demned by the expositions of the friends of the constitution, whilst depending 
 before the public; was condemned by the apparent intentions of the parties, 
 which ratified the constitution; was condemned by the explanatory amend- 
 ments proposed by Congress themselves to the constitution; and he hoped it^ 
 would receive its final condemnation by the vote of this House. 
 
 FEBRUARY 3, 1791. 
 
 A motion was made by Mr. WILLIAMSON, and seconded, that the first sec- 
 tion of the said bill be recommitted to a Committee of the Whole House, "for 
 the purpose of altering the time or manner of subscribing; so that the holders 
 of State securities, assumed to be paid by the United States, may be on a foot- 
 ing with the holders of other securities, formerly called national securities." 
 
 It passed in the negative. Ayes 21, noes 38. 
 
 Further debate arising on the main question, 
 
 MR. AMES said, little doubt remains with respect to the utility of banks. It 
 seems to be conceded, within doors and without, that a public bank would ! be 
 useful to trade, that it is almost essential to revenue, and that it is little short 
 of indispensable necessity in time of public emergency. In countries whose 
 forms of government left them free to choose, this institution has been adopted 
 of choice; and in times of national danger and calamity, it has afforded such 
 aid to Government as to make it appear, in the eyes cf the People, a neces- 
 sary means of self preservation. Tne subject, however intricate in its nature, 
 is at least cleared from obscurity. It would not be difficult to establish its 
 principles, and to deduce from its theory, such consequences, as would vindi- 
 cate the policy of the measure. But why should we lose time to examine the 
 theory, when it is in our power to resort to experience? After being tried by 
 that test, the world has agreed in pronouncing the institution excellent. This 
 new capital will invigorate trade and manufactures with new energy. It 
 will furnish a medium for the collection of the revenues; and if Government 
 should be pressed by a sudden necessity, it will afford seasonable and effec- 
 tual aid. With all these, and many otner pretensions, if it was now a ques- 
 tion whether Congress should be vested witli the power of establishing a 
 bank, I trust that this House, and all America, would assent to the affirmative. 
 
 This, however, is not a question of expediency, but of duty. We are not at 
 liberty to examine which of several modes of acting is entitled to the prefer- 
 ence. But we are solemnly warned against acting at all. We are told, that 
 the constitution will not authorize Congress to incorporate the subscribers to 
 the bank. Let us examine the constitution; and if that forbids our proceed- 
 ing, we must reject the bill; though we shall do it with deep regret, that such 
 an opportunity to serve our country must be suffered to escape, for the want 
 of a constitutional power to improve it. 
 
 The gentleman from Virginia considers the opposers of the bill as suffer- 
 ing disadvantage, because it was not debated as bills usually are, in commit- 
 tee of the whole house. He has prepared us to pronounce an eulogium upon 
 his consistency, by informing us that ne voted, in the old Congress, against the 
 Bank of North America, on the ground of his present objection to the consti- 
 tutionality. He has told us, that the meaning of the constitution is to be in- 
 terpreted by contemporaneous testimony. He was a member of the conven- 
 tion which formed it, and of course, his opinion is entitled to peculiar weight. 
 While we respect his former conduct, and admire the felicity of his situation, 
 we cannot think he sustains disadvantage in the debate. Besides, he must 
 have been prepared with objections to the constitutionality, because he tells 
 us they are ot longstanding, and had grown into a settled habit of thinking. 
 \Vhy then did he suffer the bill to pass the committee in silence? The friends 
 of the bill have more cause to complain of disadvantage: for, while he has had 
 time to prepare his objections, they are obliged to reply to them without pre- 
 meditation. 
 
46 BANK OF THE UNITED STATES. 
 
 In making this reply, I am to perform a task for which my own mind had 
 not admonished me to prepare. 1 never suspected that the objections I have 
 heard stated, had existence. I consider them as discoveries; and had not the 
 acute penetration of that gentleman brought them to light, I am sure that my 
 own understanding would never have suggested them. 
 
 It seems strange, too, that, in our enlightened country, the public should have 
 been involved in equal blindness. While the exercise of even the lawful 
 powers of Government is disputed, and a jealous eye is fixed on its proceed- 
 ings, not a whisper has been heard against its authority to establish a bank. 
 Still, however unseasonably, the old alarm of public discontent is sounded in 
 oin^ears. 
 
 Two questions occur: May Congress exercise any powers, which are not 
 expressly given in the constitution, but may be deduced by a reasonable con- 
 struction of that instrument? And, secondly, will such a construction war- 
 rant the establishment of the bank? 
 
 The doctrine, that powers may be implied which are not expressly vested 
 in Congress, has long been a bugbear to many worthy persons. They appre- 
 hend that Congress, by putting constructions upon the constitution, will 
 govern by its own arbitrary discretion; and therefore, that it ought to be bound 
 to exercise the powers expressly given, and those only. 
 
 If Congress may not make laws conformably to the powers implied, though 
 not expressed in the frame of government, it is rather late in the day to adopt 
 it as a principle of conduct. A great part of our two years' labor is lost, 
 and worse than lost to the public: for we have scarcely made a law, in which 
 we have not exercised our discretion, with regard to the true intent of the 
 constitution. Any words but those used in that instrument will be liable to 
 a different interpretation. We may regulate trade therefore we have taxed 
 ships; erected light houses; made laws to govern seamen, &c.; because we say 
 they are the incidents to that power. The most familiar and undisputed acts 
 of legislation will shew, that we have adopted it as a safe rule of action, to 
 legislate beyond the letter of the constitution. 
 
 He proceeded to enforce this idea by several considerations, and illustrated 
 it by various examples. He said that the ingenuity of man was unequal to 
 providing, especially, before hand, for all the contingencies that would hap- 
 pen. The constitution contains the principles which are to govern in making 
 laws; but every law requires the application of the rule to the case in question. 
 W r e may err in applying it; but we are to exercise our judgments, and, on 
 every occasion, to decide according to an honest conviction of its true 
 meaning. 
 
 The danger of implied powers does not arise from its assuming a new prin- 
 ciple. We have not only practised it often, but we can scarcely proceed 
 without it Nor does the danger proceed so much from the extent of the 
 power, as from its uncertainty. While the opposers of the bank exclaim 
 against the exercise of this power by Congress, do they mark out the limits 
 of the power which they will leave to us with more certainty than is done by 
 the advocates of the bank? Their rules, by interpretation, by ex-tempora- 
 neous testimony, the debates of conventions, and the doctrine of substantive 
 and auxiliary powers, will be found as obscure, and, of course, as formidable, 
 as that which they condemn. They only set up one construction against 
 another. 
 
 The powers of Congress are dissected. We are obliged to decide the ques- 
 tion according to truth. The negative, if false, is less safe than the affirma- 
 tive, if true. Why, then, shall we be told that the negative is the safe side? 
 Not exercising the powers we have, may be as pernicious as usurping those 
 we have not. If the power to raise armies had not been expressed in the 
 enumeration of the powers of Congress, it would be implied from other parts 
 of the constitution. Suppose, however, it were 9mitted, and our country 
 invaded would a decision in Congress, against raising armies, be safer than 
 the affirmative? The blood of our citizens would be shed, and shed una- 
 venged. He thought, therefore, that there was too much prepossession with 
 
CHARTER OF 1791. 47 
 
 tome against the bank, and the debate ought to be considered more impar- 
 tially, as the negative was neither more safe, certain, nor conformable to our 
 duty, than the other side of the question. After all, the proof of the affirma- 
 tive imposed a sufficient burden, as it is easier to raise objections than to 
 remove them. Would any one doubt that Congress may lend money, that 
 they may buy their debt in the market, or redeem their captives from Algiers? 
 Yet no such power is expressly given, though it is irresistibly implied. 
 
 If, therefore, some interpretation ot the constitution must be indulged, by 
 what rules is it to be governed? The great end of every association of per- 
 sons or States, is to effect the end of its institution. The matter in debate 
 affords a good illustration. A corporation, as soon as it is created, has cer- 
 tain powers or qualities tacitly annexed to it, vyhich tend to promote the end 
 for which it was formed; such as, for example, its individuality, its powers to 
 sue and be sued, and the perpetual succession of persons. Government is, 
 itself, the highest kind of corporation; and, from the instant of its formation, 
 it haSj tacitly annexed to its being, various powers, which the individuals 
 who framed it did not separately possess, but which are essential to its effect- 
 ing the purposes for which it was framed; to declare, in detail, every thing 
 that Government may do, could not be performed, and has never been at- 
 tempted. It would be end less, useless, and dangerous; exceptions of what it 
 may not do, are shorter and safer. 
 
 Congress may do what is necessary to the end for which the constitution 
 was adopted, provided it is not repugnant to the natural rights of man, or to 
 those which they have expressly reserved to themselves, or to the powers 
 which are assigned to the States. This rule of interpretation seems to be 
 safe, and not a very uncertain one, independently of the constitution itself. 
 By that instrument certain powers are specially delegated, together with all 
 powers necessary and proper to carry theni into execution. That construc- 
 tion may be maintained to be a safe one, which promotes the good of the society 
 and the ends for which the Government was adopted, without impairing the 
 rights of any man, or the powers of any State. 
 
 This, he said, was remarkably true of the bank; no man could have cause 
 to complain of it; the bills would not be forced upon any one. It is of the 
 first utility to trade. Indeed, the intercourse, from State to State, can never 
 be on a good footing without a bank, whose paper will circulate more exten- 
 sively than that of any State bank. Whether the power to regulate trade, 
 from State to State, will involve that of regulating inland bills of exchange 
 and bank paper, as the instruments of the trade incident to the power, he 
 would not pause to examine. That is an injury and wrong which violates the 
 right of another. As the bank is founded on the free choice of those who 
 make use of it, and is highly useful to the People and to Government, a libe- 
 ral construction is natural and safe. This circumstance creates a presump- 
 tion in favor of its conformity to the constitution. This presumption is 
 enforced by the necessity of a bank to other Governments. The most orderly 
 governments in Europe have banks. They are considered as indispensably 
 necessary; these examples are not to be supposed to have been unnoticed. 
 We are to pay the interest of our debt in thirteen places. Is it possible to 
 transport the revenue from one end of the continent to the other? Nay, a 
 week before the quarter's interest becomes due, transfers may be made which 
 may require double the sum in Boston which was expected. To guard 
 against this danger, an extra sum must be deposited at the different loan offices. 
 This extra sum is not to be had; our revenue is barely equal to the interest 
 due. This imposes an absolute necessity upon the Government to make use 
 of a bank. The answer is, that the State banks will supply this aid. This 
 is risking a good deal to the argument against the bank: for, will they admit 
 the necessity and yet deny to the Government the lawful and only adequate 
 means of providing for it? Ten of the States have no banks; those who have, 
 may abolish theirs, or suffer their charters to expire. But the State banks are 
 insufficient to the purpose; their paper has not a sufficient circulation; of 
 course their capitals are small. Congress is allowed a complete legislative 
 
48 BANK OF THE UNITED STATES. 
 
 power over its own finances, and yet, without the courtesy of the States, it 
 cannot be exercised. This seems to be inconsistent. 
 
 If a war should suddenly break out, How is Congress to provide for it? 
 perhaps Congress would not be sitting; great expenses would be incurred, and 
 thev must be instantly provided for. How is this to be done? By taxes? And 
 will the enemy wait till they can be collected? By loans at home? Our citi- 
 zens would employ their money in war speculations, and they are not, indivi- 
 dually, in a condition to lend a sufficient sum in specie, or shall we send 
 across the sea for loans? The disputes between England and Spain furnish 
 an example; the aid of their banks, for several millions, was prompt and effec- 
 tual. Or will you say that Congress might issue paper money? That power, 
 ruinous and fallacious as it is, is deduced from implication: for it is not ex- 
 pressly given. A bank only can afford the necessary aid, in time of sudden 
 emergency. If we have not the power to establish it, our social compact is 
 incomplete; we want the means of self preservation. 
 
 I shall, perhaps, be told, that necessity is the tyrant's plea. I answer 
 that it is a miserable one, when it is urged to palliate the violations of private 
 right. Who suffers by this use of our authority? Not the States: tor they 
 are not warranted to establish a national bank. Not individuals: for they 
 will be assisted in trade, and defended from danger by it. 
 
 Having endeavored to enforce his argument by noticing the uses of banks to 
 trade, to revenue, to credit, and, in cases of exigency, he adverted to the au- 
 thority of our own precedents. Our right to govern the Western territory is 
 not disputed. It is a power which no State can exercise. It must be exercis- 
 ed, and, therefore, it resides in Congress. But how does Congress get this 
 power? It is not expressly given in the constitution, but is derived from the 
 nature of the case, or by implication from the power to regulate the property 
 of the United States. If the power flows from the nature and necessity of 
 the case, it may be demanded, is there not equal authority for the bank? If 
 it is derived from the power of Congress to regulate the territory and other 
 property of the United States, and to make all needful rules and regulations 
 concerning it, and for the disposal of it, a strict construction would restrain 
 Congress merely to the management and disposal of property, and of its own 
 property; yet it is plain that more is intended. Congress has, accordingly, 
 made rules, not only for governing its own property, but the property of the 
 persons residing there. It has made rules which have no relation to property, at 
 all, for punishing crimes. In short, it exercises all power in that territory. 
 Nay, it has exercised the very power of creating a corporation. The Govern- 
 ment of that territory is a corporation; and who will deny that Congress may 
 lawfully establish a bank beyond the Ohio? It is fair to reason by analogy 
 from a power which is unquestionable, to one which is the subject of debate. 
 
 He then asked whether it appeared, on this view of the subject, that the 
 establishment of a national bank would be a violent misinterpretation of the 
 constitution? He did not contend for an arbitrary, unlimited discretion in 
 the Government to dp every thing. He took occasion to protest against such 
 a misconception of his argument. He had noticed the great marks by which 
 the construction of the constitution, he conceived, must be guided and limit- 
 ed, arid these, if not absolutely certain, were very far from being arbitrary or 
 unsafe. It is for the House to judge whether the construction, which denies 
 the power of Congress, is more definite and safe. 
 
 In proving that Congress may exercise powers, which are not expressly 
 granted by the constitution, he had endeavored to establish such rules of in- 
 terpretation, and had illustrated his ideas by such observations as would anti- 
 cipate, in a considerable degree, the application of his principles to the point 
 in question. Before he proceeded to me construction of the clauses of the 
 constitution which apply to the argument, he observed that it would be oro- 
 per to notice the qualities of a corporation, in order to take a more exact view 
 of the controversy. 
 
 He adverted to the individuality and the perpetuity of a corporation, and 
 that the property of the individual should not be liable for the debts of the 
 
CHARTER OF 1791. 4Q 
 
 bank or company. These qualities are not more useful to the corporation 
 than conformable to reason; but Government, it is said, cannot create these 
 qualities. This is the marrow of the argument: for Congress may set up a 
 bank of its own to be managed as public property, to issue notes which shall 
 be received in all payments at the treasury, which shall be exchangeable into 
 specie on demand, and which it shall be death to counterfeit. Such a bank 
 would be less safe and less useful than one under the direction of private 
 persons; yet the power to establish it is indisputable. If Congress has the 
 authority to do this business illy, the question returns whether the powers of 
 a cprporation, which are essential to its being well done, may be annexed as 
 incident to it. The bank of New York is not a corporation, yet its notes 
 have credit. Congress may agree with that bank, or with a company of mer- 
 chants, to take their notes, and to cause all payments to pass through their 
 coffers. Every thing that the Government requires of, and will perform to 
 the bank, may be lawfully done without giving them corporate powers; but 
 to do it well, safely, and extensively, those powers are indispensable. This 
 seems to bring the clebate within a narrow compass. 
 
 This led him to consider whether the corporate powers are incidental to 
 those which Congress may exercise by the constitution. 
 
 He entered into a discussion of the construction of that clause, which em- 
 powers Congress to regulate the territory and other property of the United 
 States. The United States may hold property; may dispose of it; they may 
 hold it in partnership; they may regulate the terms of the partnership. One 
 condition may be that the common stock only, shall be liable for the debts of 
 the partnership, and that any purchaser of a share shall become a partner. 
 These are the chief qualities of a corporation. It seems that Congress, having 
 the power to make all needful rules and regulations for the property of the 
 United States, may establish a corporation to manage it; without which we 
 have seen that the regulation cannot be either safe or useful. The United 
 States will be the proprietor of one-tenth of the bank stock. 
 
 Congress may exercise exclusive legislation, in all cases whatsover, over 
 the ten miles square, and the places ceded by the States for arsenals, light 
 houses, docks, &c.; of course, it may establish a bank in those places, with 
 corporate powers. The bill has not restrained the bank to this city, and if it 
 had, this dispute would lose a part of its solemity. If, instead of principles, it 
 concerns only places, what objection is there to the constitutional authority of 
 Congress to fix the bank at Sandy Hook or Reedy Island, where we have light 
 houses, and a right of exclusive legislation? A bank established there, or in 
 the district located by law on the Potomac for the seat of government, could 
 send its paper all over the Union. It is true that the places are not the most 
 proper for a bank, but the authority*! establish it in them, overthrows the 
 argument which is deduced from the definite nature of the powers vested in 
 Congress, and the dangerous tendency of the proposed construction of them. 
 
 The preamble of the constitution warrants this remark, that a bank is not 
 repugnant to the spirit and essential objects of that instrument. 
 
 He then considered the power to borrow money. He said it was natural 
 to understand that authority as it was actually exercised in Europe, which is 
 to borrow of the bank. He observed, the power to borrow was of narrow use 
 without the institution of a bank, and, in the most dangerous crisis of affairs, 
 would be a dead letter. 
 
 After noticing the powers to lay and collect taxes, he adverted to the sweep- 
 ing clause, as it is usually called, which empowers Congress to exercise all 
 power necessary and proper to carry the enumerated powers into execution. 
 He did not pretend that it gives any new power, but it established the doc- 
 trine of implied powers. He then demanded whether the power to incorpo- 
 rate a bank is not fairly relative, and a necessary incident to the entire power 
 to regulate trade and revenue, and to provide for the public credit and 
 defence? 
 
 He entered into a particular answer to several objections, and after recapi- 
 tulating his argument, he concluded with observing, that we had felt the disad- 
 7 
 
50 BANK OF THE UNITED STATES. 
 
 vantages of the confederation. We adopted the constitution, expecting to^ 
 place the national affairs under a federal head. This is a power which Congress 
 can only exercise. We may reason away the whole constitution. All nations 
 have their times of adversity and danger. The neglect of providing against 
 therii in season, may be the cause of ruining the country. 
 
 FEBRUARY 4. 
 
 MR. SEDOWIUK said he would endeavor not to fatigue the patience of the 
 House in the observations he should make on the important subject now under 
 consideration. Without entering into a discussion on a scale so extensive as 
 had been indulged by some gentlemen,, he would dwell only on a few impor- 
 tant principles, and such consequericees as were conclusively deducible from, 
 them, which had made a strong impression on his mind. 
 
 The opposition to the bill had called into question the constitutional powers 
 of Congress to establish the proposed corporation, and the utility of banks, 
 neither of which, till within a few days, did he suppose was doubted by airy 
 intelligent person in America; and had charged the present system with hold- 
 ing out unequal terms against the Government, to those who should subscribe 
 to the proposed stock. 
 
 With regard to the question of constitutionality ,jnuch had been said, which, 
 in his opinion, had not an intimate relation to the subject now before the House. 
 We have with great earnestness been warned of the danger of grasping power 
 by construction and implication and this warning has been given in very 
 animated language by the gentleman from Virginia (Mr. M.) I do not wish to 
 deprive that member of the honor of consistency: but I well remember the 
 time when the energy; of his reasoning impressed on the minds of a majority 
 of this House, a conviction that the power of removal from offices holdeu at 
 will, was, by construction and implication, vested by the constitution in the 
 President so there could be no-pretence, that it was expressly granted to him. 
 
 He said he would observe,, in answer to every thing that had been said of 
 the danger of extending construction and implication, that the whole busi- 
 ness of legislation was a practical construction of the powers of the Legisla- 
 ture, and that probably no instrument for the delegation of power could be 
 drawn up with such precision and accuracy, as to leave nothing to necessary 
 implication. That all the different Legislatures in the United States !>id, and 
 this, in his opinion, indispensably must, construe the powers which had been 
 granted to them; and they must assume such auxiliary powers as are necessarily 
 implied in those which are expressly granted. In doing which it was no doubt 
 their duty to be careful not to exceed those limits within which it was intend- 
 ed they should be restricted. By any other limitation, said he, the Govern- 
 ment would be so shackled that it would be incapable of operating any of the 
 effects which were intended by its institution. 
 
 He observed that, on almost all the great and important measures which 
 come under the deliberation of Congress, there were immense difficulties ta 
 he surmounted. If we attempt, said he, to proceed intone direction, our ears- 
 are assailed with the exclamation of the constitution is in danger; if we at- 
 tempt to attain our objects, by pursuing a different course, we are told the 
 pass is guarded by the stern spirit of democracy. Did I concur with gen- 
 tlemen in opinion on this subject, I should think it my duty to go home to my 
 constituents, and honestly declare to them, that, by their jealousy of power, 
 they had so restrained the operations of the Government, that we have not 
 the means of effecting any of the great purposes for which the constitution was 
 designed, without attempting what, perhaps, would be found impracticable to- 
 fix the general rules, the nice point within which Congress would be autho- 
 rized to assume powers by construction and implication, and beyond which 
 they may be justly considered usurpers. 
 
 He wished gentlemen to reflect, what effect a single principle, universally 
 acknowledged, would have, in determining the question now under consider- 
 ation. It is universally agreed, that wherever a power is delegated for ex- 
 press' purposes, all the knoivn and usual means for the attainment of the oh- 
 
CHARTER OF 1791. 51 
 
 Jccts expressed, are conceded also. That, to decide what influence this ac- V 
 knowledged principle would have on the subject before the House, it would 1 
 be necessary to reflect on the powers with which Congress are expressly in- 
 vested. He then repeated, that Congress was authorized to lay and collect 
 taxes, to borrow money on the credit of the United States, to raise and sup- 
 port armies, provide and maintain navies, to regulate foreign and domestic 
 trade, to make all laws necessary and proper to carry these, and the other 
 enumerated powers, into effect; they were, in fine, entrusted with the exercise 
 of ail those powers, which the People of America thought necessary to secure 
 their fame and happiness against the attacks of internal violence and external 
 invasion. And, in the exercise of these powers, the Legislature was authoriz- 
 ed, agreeably to the principles which he had mentioned, to exercise all the 
 known and usual means* necessary and proper, to effectuate the ends which 
 are expressed. It might be of use to determine, with precision, what will 
 be the meaning of the words necessary and proper. They do not restrict the 
 power of the Legislature to enacting such laws only as are indispensable. 
 Such a construction would be infinitely too narrow and limited; and to apply 
 the meaning strictly, it would prove, perhaps, that all the laws which had 
 been passed, were unconstitutional; for few, if any, of them, could be proved 
 indispensable to the existence of the Government. The conduct of Congress 
 had a construction on those words more rational and consistent with common 
 sense, and the purposes for which the Government was instituted; which he 
 conceived to be, that the laws should be established on such principles, and 
 such an agency in the known and usual means employed in the execution of 
 them, as to effect the ends expressed in the constitution, with the greatest pos- 
 sible degree of utility. If banks were among the known and usual means to 
 effectuate or facilitate the ends which had been mentioned, to enable the Go- 
 vernment, with the greatest ease and least burden to the People, to collect 
 taxes, to borrow money, regulate commerce, raise and support armies, pro- 
 vide and maintain fleets; he thought the argument irrefragable and conclusive, 
 to prove the constitutionality of the bill. Pursuing, further, the same idea, 
 he asked, for what purpose were banks instituted and patronised by govern- 
 ments which were unrestricted by constitutional limits? Were they not 
 employed as the means, and the most useful engines, to facilitate the collec- 
 tion of taxes, borrowing of money, and the other enumerated powers? Be- 
 sides, he said, it was to be observed, that the constitution had expressly de- 
 clared the ends of legislation; but, in almost every instance, had left the 
 means to the honest and sober discretion of the Legislature. From the nature 
 of things, this must ever be the case; for, otherwise, the constitution must 
 contain, not only all the necessary laws under the existing circumstances of 
 the community, but also a code so extensive, .as to adapt itself to all future 
 possible contingencies. By our constitution, Congress has power to lay and 
 collect taxes; but every thing subordinate to that end, such as the objects, the 
 means, the instruments, and the purposes, are left to the honest and sober 
 discretion of the Legislature. The power of borrowing money was expressly 
 granted; but all the known and usual means to that end, vvere left in silence. 
 The same observations might, in truth, be made, respecting the other dele- 
 gated powers. The great ends to be obtained, as means to effectuate the ulti- 
 mate end the public good and general welfare are capable, under general 
 terms of constitutional specification; but the subordinate means are so nu- 
 merous, and capable of such infinite variation, as to render an enumeration 
 impracticable, and must, therefore, be left to construction and necessary im- 
 plication. He said, on this ground he was willing to leave the general argu- 
 ment it was simple ? intelligible, and he hoped would be thought conclusive. 
 He said, the constitutionality had been attacked from another quarter. It 
 was said, we could not give commercial advantages to one port above another. 
 The constitutional provision which had been quoted, was undoubtedly intend- 
 ed to prevent a partial regulation of commerce; if extended to the case under 
 consideration, it would much more strongly prove, that Congress ought not to 
 reside in any commercial city; for he verily believed, that the commercial 
 
52 BANK OF THE UNITED STATES. 
 
 /advantages of Philadelphia were incomparably greater, from the residence, 
 than they could be supposed from the institution of a national bank. Indeed, 
 it was his opinion, that, considering that this city had a bank, the capital of 
 which was adequate to all her commercial exigencies, that she could enlarge 
 that capital as her necessity should require, and that her bank will, if thisbUl 
 shall be refected, receive the benefit of national operation, that the measure 
 will not advance her individual interest. 
 
 With regard to the utility of banks, he observed, that lie would not attempt 
 to display a knowledge of the subject, by repeating all he had read and heard 
 m relation to it, nor fatigue the House by a detail of his own reflections and 
 reasoning upon it; the causes were unnecessary to be explained; the effects 
 had been such m all countries where banks had been instituted, as to produce 
 an universal opinion, that they were alike useful to all the great purposes of 
 government, and to promote the general happiness of the people. Nor was 
 our own experience wanting to the same purpose. At a time when our public 
 resources were almost annihilated, our credit pros trate r our Government im- 
 becile, and its patronage inconsiderable, a bank, of small capital, was among 
 the most operative causes which produced that first dawn that ultimately ter- 
 minated in meridian splendor, by the establishment of peace, independence, 
 |j and freedom. There were two circumstances which he would take the liberty 
 to mention, which would render the banks of more importance in this coun- 
 try than in any where they are at present in use. The first, the com- 
 mercial enterprise of our merchants, compared with the smallness of their 
 capitals, which, as we had no large manufacturing capitals, whereby the pre- 
 cious metals would be retained in circulation, would frequently, by their ex- 
 portation, greatly distress the people; the other, originated from a measure of 
 the Government. Congress, from a laudable intention of accommodating 
 their constituents, instituted treasuries in all the States: in some of these 
 there would be, in the ordinary course of events, a deficiency, and in others* 
 a redundancy. To keep them in equilibrio, by the transportation of the pre- 
 cious metals, or by the purchase of bills in the market, would not be only in- 
 convenient and expensive, but would keep out of circulation a considerable 
 part of the medium of the country. 
 
 Gentlemen, he said, had been pleased to consider the proposed terms as 
 giving an undue advantage to the stockholders. He would leave this part of 
 the subject to gentlemen who better understood it, only observing that, as 
 Government must rely principally on merchants to obtain the proposed stock, 
 it would be necessary to afford to them sufficient motives to withdraw from, 
 their commercial pursuits a part of their capitals. 
 
 He said he would attempt to answer some of those desultory objections 
 which had been made; and, in doing this, he would omit to answer such as had 
 been, in his opinion, already refuted. He observed that it had been said 
 that granting charters of incorporation was a high prerogative of Government. 
 He supposed it was not intended that it was, in the nature of things, too 
 transcendent a power to be exercised by a national government; but that the 
 exercise of it should only be in consequence of express delegation. Let this 
 objection be compared with the conduct of Congress on another subject, in all 
 respects, at least, as important. There is not, by the constitution, any power 
 expressly delegated to mortgage our revenues; and yet, without any question 
 being made on the constitutionality of the measure, we have mortgaged them 
 to an immense amount From whence, he asked, do we acquire the autho- 
 rity to exercise this power? Not from express grants, but being empowered 
 to borrow money on the credit of the United States. We have very properly 
 considered the pledged funds as among the known and usual means necessary 
 and proper to be employed for the attainment of the end expressly delegated. 
 
 It had been said that the bill authorized the stockholders to purchase real 
 estate. He considered the provision in the bill, in that regard, not a grant, 
 but a limitation of power. Any man, or body of men, might, by the existing 
 laws, purchase, in their private capacities, real estate to any amount. This 
 right was limited as respects the proposed corporation* 
 
CHARTER OF 1791. 53 
 
 It is said there are banks already, and, therefore, the proposed incorpora- 
 tion is unnecessary. To this he answered, that, if the Government should 
 agree to receive all its demands in the paper of the existing banks, it would 
 give to them every advantage which, in the opinion of gentlemen, renders the 
 present system objectionable, without stipulating for any equivalent to the 
 Government. But are, he asked, gentlemen serious in these observations? 
 Do they believe the capitals of the present banks adequate to the exigencies 
 of the nation? Do they believe that those banks possess any powers by which 
 they can give a projectile force to their paper, so as to extend its circulation 
 throughout the United States? Or, do they really wish to have the Govern- 
 ment repose itself on institutions with which they have no intimate connex 
 ion, and over which they have no control? 
 
 Mr. Sedgwick concluded by observing, he was very confident a majority 
 in that House could never be induced to believe that it was the intention of 
 the constitution to deprive the Legislature of one of the most important and 
 necessary means of executing the powers expressly delegated. 
 
 Mr. LAWRENCE said, the advocates of this measure stand in an unfor- 
 tunate situation; for, being those who, in general, advocate national measures, 
 they are charged with designs to extend the powers of the Government un- 
 duly. He, however, consoled himself with a conscious attachment to the 
 constitution, and with the reflection that their conduct received the approba- 
 tion of their constituents. If the- present is contrasted with the former cir- 
 cumstances of this country, he said he doubted not the measures of this Go- 
 vernment would continue to receive the approbation of the People of the Unit- 
 ed States. 
 
 The silence of the People on the subject now before the House, is strongly 
 presumptive that the measure of a bank is not considered by them as uncon- 
 stitutional. He then endeavored to shovy the constitutionality of the bank 
 system. It must be conceded that there is nothing in the constitution ex- 
 pressly against it, and, therefore, we ought not to deduce a prohibition by con- 
 struction. He adverted to the amendment proposed by Congress to the con- 
 stitution, which says, " powers not delegated are retained." Here, he said, 
 to prove that the bank is constitutional, the constructive interpretation, so 
 much objected against, is recurred to. 
 
 The great objects ol this Government are contained in the context of the 
 constitution- He recapitulated those objects, and inferred that every power 
 necessary to secure these, must necessarily follow: for, as to the great objects 
 for which this Government was instituted, it is as full and complete, in all its 
 parts, as any system that could be devised. A full, uncontrollable power to 
 regulate the fiscal concerns of this Union, is a primary consideration in this 
 Government; and, from hence, it clearly follows, that it must possess the 
 power to make every possible arrangement conducive to that great object. 
 
 He then adverted to the late confederation, and pointed out its defects and 
 incompetency; and hence, the old Congress called on the States to enact cer- 
 tain laws, which they had not power to enact. From hence he inferred, that, 
 as the late confederation could not pass those laws, and to capacitate the 
 Government of the United States, and form a more perfect union, the consti- 
 tion under which we now act was formed. To suppose that this Government 
 does not possess the powers for which the constitution was adopted, involves 
 the grossest absurdity. 
 
 The deviations from charters, and the infringement of parchment rights, 
 which had been justified on the principle of necessity, by the gentleman from 
 Virginia, (Mr. MADISON) he said, had been on different principles from those 
 now mentioned; the necessity, he contended, did not, at the time, exist; and 
 the old Congress exercised the power, as they thought, by a fair construction 
 of the confederation. 
 
 On constructions, he observed, it was to be lamented that they should ever 
 be necessary; but they had been made; lie instanced the power of remova- 
 
54 BANK OF THE UNITED STATES. 
 
 bility, which had been an act of the three branches, and has not been com- 
 plained of. It was, at least, as important a one as the present. 
 
 But the construction now proposed, he contended, was an easy and natural 
 construction. Recurring to the collection law, he observed, that it was by con- 
 struction that the receipts are ordered to be made in gold and silver. 
 
 With respect to creating a mass of capital, he supposed just and upright 
 national measures would create a will to form this capital. 
 
 Adverting to the idea that Congress has not the power to establish compa- 
 nies with exclusive privileges, he observed that, by the amendments proposed 
 by New Hampshire, Msssachusetts, and New York, it plainly appears that 
 these States considered that Congress does possess the power to establish 
 such companies. 
 
 The constitution vests Congress with power to dispose of certain property 
 in lands, and to make all useful rules and regulations for that purpose. Can 
 its power be less over one species of its own property than over another? 
 
 "With respect to giving preference to one State over another, he observed that, 
 ten years hence, the seat of Government is to be on the Potomac, and, where- 
 ever the Government is finally settled, the place will enjoy superior ad vantages; 
 but still the Government must go there, and the places not enjoying those ad- 
 vantages must be satisfied. 
 
 It is said we must not pass a problematical bill, which is liable to a super- 
 vision by the judges of the supreme court; but, he conceived there was no 
 force in this, as those judges are invested, by the constitution, with a power to 
 pass their judgment on all laws that may be passed. 
 
 It is said that this law may interfere with the State Governments; but this 
 may or may not be the case; and in all interferences of the kind, the particu- 
 lar interest of a State must give way to the general interest. 
 
 With respect to the C9rporation possessing the power of passing laws, this, 
 he observed, is a power incidental to all corporations, and, in the instance of 
 the Western territory, Congress have exercised the powers of instituting cor- 
 porations, or bodies politic, to the greatest possible extent. 
 
 He defended the right of Congress to purchase and possess property, and 
 quoted a passage in the constitution to show that they possess this right. 
 
 He then touched upon the expediency of banks, and of that proposed, in 
 particular. The advantages generally derived from these institutions, he be- 
 lieved, applied peculiarly to this country. He noticed the objections, from 
 banks banishing the specie; he said, the surplus only would be sent out of the 
 country. But, is it given away? No, Sir, it is sent off for articles which are 
 wanted, and which will enrich the country. 
 
 With respect to a run on the bank, he mentioned the circumstances under 
 which those runs on the British banks, which had been noticed, took place, 
 and showed there was no parallel that would ever take place in this country. 
 
 From several particulars, he showed that the objection which arose, from 
 the United States not having made a good bargain by the system, was not 
 well founded. He then mentioned the peculiar advantages which the Unit- 
 ed States will enjoy over common subscribers- 
 
 The objections from banks being already established in the several States, 
 he obviated, by stating the mischiefs which might arise from an ignorance of 
 the situation of those banks: and concluded by some remarks on the inexpe- 
 diency of the General Government's having recourse to institutions of mere- 
 ly a local nature. 
 
 Mr. JACKSON said that, having been the person who brought forward the 
 constitutional objections against the bill, he thought himself bound to notice 
 the answers which had been offered to that objection. Newspaper authorities, 
 he said, have been alluded to, and their silence on the subject considered as 
 indicating the approbation of the People. He would meet the gentlemen on 
 that ground, and, though he did not consider newspapers as an authority to 
 be depended on, yet, it opinions, thro' that channel, were to be regarded, he 
 
CHARTER OF 1791. 
 
 55 
 
 would refer gentlemen to those of this city. The expediency and constitution- 
 ality of the bill has been called in question by the newspapers of this city. 
 
 The latitude contended for in construing the constitution on this occasion, 
 he reprobated very fully. If the sweeping clause, as it is called, extends to 
 vesting Congress with such powers, and necessary and proper means are an 
 indispensable implication, in the sense advanced by the advocates of the bill, 
 we shall soon be in possession of all possible powers, and the charter under 
 which we sit will be nothing but a name. i 
 
 This bill will essentially interfere with the rights of the separate States, } J 
 for it is riot denied that they possess the power ot instituting banks; but the 
 proposed corporation will eclipse the Bank of North America, and contravene 
 the interests of individuals concerned in it. 
 
 He then noticed the several arguments drawn from the doctrine of impli- 
 cation; the right to incorporate a national bank has been deduced from the 
 power to raise armies; but he presumed it would not be contended that this 
 is a bill to provide for the national defence. Nor could such a power, in his opi- 
 nion, be derived from the right to borrow money. It has been asked what 
 the United States could do with the surplus of their revenue, without the 
 convenience of a bank, in which to deposite it with advantage? For his part, 
 though he wished to anticipate j)leasing occurrences, he did not look forward 
 to the time when the General Government would have this superabundance 
 at its disposal. 
 
 The right of Congress to purchase and hold lands has been urged, to prove 
 that they can transfer this power; but the General Government is expressly 
 restricted in the exercise of this power; the consent of the particular State to 
 the purchase, for particular purposes only, is required; these purposes are de- 
 signated, such as building light houses, erecting arsenals, &c. 
 
 It has been said that brinks may exist without a charter, but that this in- 
 corporation is necessary, in order that it may have a hold on the Government. 
 Mr. Jackson strongly reprobated this idea; he was, he said, astonished to , 
 hear such a declaration, and hoped that such ideas would prevent a majority 
 of the. House from passing a bill that would thus establish a perpetual mono- 
 poly. We have, said he, I believe, a perpetual debt : I hope we shall not make 
 a perpetual corporation. /What was it drove our forefathers to this country? 
 Was it not the ecclesiastical cornorations^and perpetual monopolies of Eng- 
 land and Scotland? Shall vye sufter the same evils to exist in this country, in- 
 stead of taking every possible method to encourage the increase of emigrants 
 to settle among us? For, if we establish the precedent now before us, there 
 is no saying where it shall stop. 
 
 The power to regulate trade is said to involve this, as a necessary means; 
 but the powers consequent on this express power, are specified: such as re- 
 gulating light houses, ships, harbors, &c. It has been said, that Congress has 
 borrowed money; this shews that there is no necessity of instituting any new 
 bank, those already established having been found sufficient for the purpose. 
 He denied the right of Congress to establish banks at the permanent seat ot 
 Government, or on those sand heaps mentioned yesterday: for, if they should, 
 they could not force the circulation of their paper one inch beyond the limits 
 of those places. But, it is said, if Congress can establish banks in those si- 
 tuations, the question becomes a question of place, and not of principle; from 
 hence, it is interred that the power may be exercised in any other part of the 
 United States; this appeared to him to form a very dangerous construction of 
 the powers vested in the General Government. 
 
 Adverting to the powers in Congress, in respect to the finances of the Union, 
 he observed that those powers did not warrant the adoption of whatever mea- 
 sures they thought proper; the constitution has restricted the exercise of those 
 fiscal powers; Congress cannot lay a poll tax, nor impose duties on exports, 
 and yet these undoubtedly relate to the finances. 
 
 The powers exercised in respect to the Western territory, he observed, 
 had reference to property already belonging to the United States; it does not 
 refer to property to be purchased, nor does it authorize the purchase of any 
 
56 BANK OP THE UNITED STATES. 
 
 additional property; besides, the powers are express and definite, and the 
 exercise of them, in making needful rules and regulations in the government 
 of that territory, does not interfere with the rights of the respective States. 
 
 Mr. Jackson then denied the necessity of the proposed institution, and, 
 noticing the observation of Mr. Ames, that it was dangerous, on matters of 
 importance, not to give an opinion, observed, that he could conceive of no 
 danger that would result from postponing that construction of the constitution 
 now contended for, to some future Congress, who, when the necessity of a 
 bank institution shall be apparent, will be as competent to the decision as 
 the present House. Alluding to the frequent representations of the flourish- 
 
 /ing situation of the country, he inferred that this shows that the necessity 
 of the proposed institution does not exist at the present time; why should 
 we then be anticipating for future generations? State banks he considered 
 preferable to a national bank, as counterfeits can be detected in the States; 
 but, if you establish a national bank, the checks will be found only in the city 
 of Philadelphia or Conogocheague. He then passed an eulogium on the Bank 
 of Pennsylvania; the stockholders, said he, are not speculators; they have the 
 solid coin deposited in their vaults. 
 
 He adverted to the preamble and context of the constitution, and asserted 
 that this context is to be interpreted by the general powers contained in the 
 instrument. Noticing the advantages it had been said would accrue to the 
 United States from the bank, he asked, is the United States going to com- 
 mence stockjobbers? The " general welfare" are the two words which are 
 to involve and justify the assumption of every power. But what is this gene- 
 ral welfare? It is the welfare of Philadelphia, New York, and Boston: for, as 
 to the States of Georgia and New Hampshire, they may as well be out ofthe 
 Union, as to any advantages they will receive from the institution. He re- 
 
 ( probated the idea of the United States deriving any emolument from the bank, 
 and, more especially, he reprobated the influence which it was designed ithe 
 Government should enjoy by it. He said, the banks of Venice and Amsterdam 
 were founded upon different principles. In the famous bank of Venice, the 
 Government holds no shares, and yet has at command 5,000,000 ducats; but 
 the United States were to be immediately concerned in theirs, and to become 
 stockjobbers. The Bank of Amsterdam was under the entire direction of 
 the burgomasters, who had alone the power of making by-laws for its regu- 
 lation; this power, by the bill, was given up by Government, very improper- 
 ly he thought, and was to be exercised by the stockholders. The French 
 bank, he added, was first established on proper principles, and flourished; but 
 afterwards became a royal bank; much paper was introduced, which destroy - 
 tlie establishment, and was near oversetting the Government. 
 
 The facility of borrowing, he deprecated; it will, said he, involve the Union 
 in irretrievable debts; the facility of borrowing is but another name for antici- 
 pation, whidywill, in its effects, deprive the Government of the power to con- 
 trol its revenues they will be mortgaged to the creditors of the Government. 
 Let us beware of following the example of Great Britain in this respect. He 
 said, undue advantages had been taken in precipitating the measure, and the 
 reasonable proposition respecting the State debts is not admitted; this, I con- 
 sider, as partial and unjust. A gentleman from Virginia has well observed, 
 that we appear to be divided by a geographical line- not a gentleman, scarcely, 
 to the eastward of a certain line, is opposed to the bank, and where is the gen- 
 tleman to the southward, that is for itr This ideal line will have a tendency 
 to establish a real difference. He added a few more observations, and conclud- 
 ed by urging a postponement, if any regard was to be had to the tran 
 quillity ofthe Union. 
 
 Mr. BOUDINOT said he meant to confine himself to two or three great points, 
 on which the whole argument appeared to him to rest. He considered the 
 objections to the bill as pointed against its constitutionality and expediency. 
 It was essential, he observed, that every member should be satisfied, as far 
 as possible, of the first: for, however expedient it might be, if it was clearly 
 
CHARTER OF 1791. 57 
 
 unconstitutional, the bill should never receive the sanction of the Representa- 
 tives of the People, He would, in a great measure, refer for its expediency, 
 if constitutional, to the experience of every gentleman of the House, as the 
 most satisfactory proof on that head, and he conceived there was no need of 
 much argument in support of its decision. The first question, then, was, is 
 Congress vested with a power to grant the privileges contained in the bill? 
 This is denied, and oyght to be proved. In order to show in what manner 
 this subject had struck his mind, he first laid down these principles: 
 
 Whatever power is exercised by Congress must be drawn from the consti- 
 tution; either from the express words or apparent meaning, or from a neces- 
 sary implication, arising from the obvious intent of the framers. 
 
 That whatever powers, (vested heretofore in any individual State) not 
 granted by this instrument, are still in the people o'f such State, and cannot 
 Be exercised by Congress; that whatever implication destroys the principle of 
 the constitution, ought to be rejected; that, in construing an instrument, the 
 different parts ought to be so expounded as to give meaning to every part 
 which will admit of it. 
 
 Having stated these preliminaries, Mr. Boudinot proceeded to inquire what 
 were the powers attempted to be exercised by this bill: for, until the powers 
 were known, the question of constitutionality could not be determined, 
 
 By it, Congress was about to exercise the power of incorporating certain, 
 individuals, thereby establishing a banking company "for successfully con- 
 ducting the finances of the country." 
 
 The next inquiry is, What rights will this company enjoy in this nevv cha- 
 racter, that they do not enjoy independent of itr Every individual citizen 
 had an undoubted right to purchase and hold property, both real and personal, 
 to any amount xvhatever; to dispose of this property to whom, and on what 
 terms, he pleased; to lend his money, on legal interest, to any person willing 
 to take the same; and, indeed, to exercise the power over his property, that 
 was contained in the bill. Individual citizens, then, having these powers, 
 might also associate together in company of co-partnership, ami, jointly, exer- 
 cising the same rights, might hold lands in joint-tenancy, or as tenants in 
 common, to any amount whatever; might put any sum of money into joint 
 stock: might issue their notes to any amount; might make by-laws, or arti- 
 cles of co partnership for their own government; and, finally, might set up a 
 bank to any amount, however great, and no authority in the Government could 
 legally interfere with the exercise of these rights. The great difference be- 
 tween this private association of citizen*, in their individual capacities, and 
 the company to be created in this bill, and which is held up in so dangerous a 
 light, is, that the one exposes the company to the necessity of using each indi- 
 vidual's name in all their transactions; suits must be brought in all their 
 names; deeds must be taken and given in like manner; each one, in his private 
 estate, is liable for the default of the rest; the death of a member dissolved the 
 partnership, as to him; and, for want of a political existence, the union may 
 be dissolved by any part of its members, and, of course, many obvious incon- 
 veniences must be suffered, merely of an official kind. By the bill, these 
 difficulties are to be removed, by conveying three qualities to them: 
 . First. Individuality, or constituting a number of citizens into one legal ar- 
 tificial body, capable, by a fictitious name, of exercising the rights of an 
 individual. 
 
 Second. Irresponsibility in their individual capacity, not being answerable 
 beyond their joint capital. 
 
 Third. Durability, or a political existence for a certain time, not to be 
 effected by the natural death of its members. 
 
 These are the whole of the powers exercised and the rights conveyed. It 
 is true these are convenient and advantageous to the company, but of trifling 
 importance when considered as a right or power exercised by a national legis- 
 lature, for the benefit of the government Can it be of any importance to the 
 State, whether the number of its citizens are considered, in legal contempla- 
 tion, as united in an individual capacity, or separately, as so many individuals, 
 8 
 
58 BANK OF THE UNITED STATES. 
 
 especially if the public weal is thereby promoted? By their irresponsibility 
 being known, every pei son dealing with them gives his tacit consent to the 
 principle, and it becomes part of the contract; and, by political duration, their 
 powers and abilities are limited, and their rights restricted, so as to prevent 
 any danger that might arise from the exercise of their joint natural right, not 
 only as to the amount of their capital, but as to the by-laws they may make 
 for their government. 
 
 A private bank could make contracts with the Government, and the Govern- 
 ment with them, to all intents and purposes as great and important as a public 
 bank, would their capital admit of it; though they would not possess such 
 qualities as to justify the confidence of Government, by depending on them in 
 a time of danger and necessity. This might put it. in the power of any indi- 
 vidual to injure the community in its essential interests, by withdrawing the 
 capital when most needed. To prevent this, and many other inconveniences, 
 it is necessary that a bank, for the purposes of Government, should be a legally 
 artificial body, possessing the three qualities above mentioned. 
 
 Mr. Boudinot then took up the constitution, to see if this simple power 
 was not fairly to be drawn, by necessary implication, from those vested by 
 this instrument in the legislative authority of the United States. It sets out, said 
 he, in the preamble, by declaring the general purposes for which it was formed: 
 4 The cnsu ranee of domestic tranquillity^ provision for the common de- 
 fence, and promotion of the general welfare." These are the prominent fea 
 tures of this instrument, and are confirmed and enlarged by the specific grants 
 in the body of it, where the principles on which the .Legislature should rest 
 their after proceedings are more fully laid down, and the division of power 
 to be exercised by the general and particular governments distinctly marked 
 out. By the eighth section, Congress has power " to levy taxes, pay debts, 
 provide for the common defence and general welfare, declare war, raise and 
 support armies, provide for and maintain a navy;" and, as a means to accom- 
 plish these important ends, " ; to borrow money;" and, finally, " to make all 
 laws necessary and proper for the carrying into execution the foregoing 
 powers." Le't us then inquire, is the constituting a public bank necessary to 
 these important and essential ends of government r It so, the right to exercise 
 the power must be in the supreme Legislature. 
 
 He argued, the power was not contained in express words, but it was neces- 
 sarily deduced, by the strongest and most decisive implication, because, he 
 contended, it was a necessary means to attain a necessary end. Necessary 
 implication had led Congress, under the power to lay and collect imposts and 
 taxes, to establish officers for the collection, to inflict penalties against those 
 who should defraud the revenue, to oblige vessels to enter one port and deli- 
 ver at another, subjected them to various ceremonies in their proceedings, for 
 which the owners were made to pay; and he conceived it was not so great an 
 exertion of power, by implication, to incorporate a company for the purpose of 
 a bank. He also deduced the right from the power of paying debts, raising 
 armies, providing for the general welfare and common defence, for which they 
 were to borrow money. All these necessarily include the right of using every 
 proper and necessary means to accomplish these necessary ends. It was cer- 
 tain, he said, that money must be raised from the People. This could not be 
 done in sums sufficient for the exigencies of Government in a country where 
 the precious metals were so scarce as in this. The people, in general, are poor, 
 when compared with European nations; they have a wilderness to subdue and 
 cultivate; taxes must be laid with prudence, and collected with discretion. 
 The anticipation of the revenues, therefore, by borrowing money, becomes 
 absolutely necessary. If so, then, as the constitution had not specified the 
 manner of borrowing, or from whom the loan was to be obtained, the Supreme 
 Legislature of the Union were at liberty, it was their duty, to fix upon the 
 best mode of effecting the purposes of their appointment. For it was a sound 
 principle, that, when a general power is granted, and the means are not speci- 
 fied, they are left to the discretion of those in whom the trust is reposed, pro 
 vided they do not adopt means expressly forbidden. The public defence or 
 
CHARTER OF 1791. 59 
 
 general welfare, rested on the annual supplies from uncertain revenues, would 
 expose the very existence of the. community. It is the duty, then, of those to 
 whom the people have committed this power, to prepare, in time of peace, for 
 the necessary defence in a time of war. The United States are now, happily, 
 in a state of peace; but it was impassible for anyone to say how long it would 
 continue. By prudent management, it might long be preserved; but this pru- 
 dence consisted in being always in a state ot preparation to defend our 
 country. 
 
 The constitution contemplates this very duty, by authorizing Congress to 
 provide for the common defence, by borrowing money. Why borrow money? 
 Are not the annual revenues sufficient? It might be so. if nothing was attend- 
 ed to but internal wants: but the common defence and general welfare loudly 
 call for that provision which will produce a constant guard on external ene- 
 mies and internal insurrections* To this necessary end, it becomes Congress 
 to provide that the necessary means may be always at hand, by being able to 
 arm their citizens^ and provide for their support while engaged in the defence 
 rf their common country. This can be done only by borrowing money, which 
 is usually of citizens or foreigners: if of the first, it must be from individuals 
 or from private banks. Will it be prudent to trust to either? Loans from 
 individuals were attempted during the war, when patriotism produced a will 
 in some lenders, and others were glad to get rid of a depreciating paper cur- 
 rency, almost on any terms whatever. 
 
 But, even these loan?, arising from this paper medium, with which the mar- 
 ket was glutted, were altogether insufficient; and. by one change of circum- 
 stances, every hope was precluded of being any ways successful in procuring 
 money from that source. The circumstances of individuals, too. in this coun- 
 try, are such, when compared with the wants of a nation, as render the source 
 too vaue and uncertain to rely upon, and it would be a most improvident 
 execution of the powers granted for the express purpose of the common de- 
 fence and general welfare. Private banks were almost as inadequate to the 
 object, and, for reasons already given, were neither to be depended on, for 
 will or capital, as to the supply for the principal wants of Government. 
 They are generally established for commercial purposes, and on capitals not 
 always sufficient for them. If they should be prevailed upon, at any thne, to 
 attempt to supply the demands of a nation at war, it must, be from a general 
 combination of their whole stocks, to the destruction of the original designs 
 of their several institutions. This ought not to be expected: for, as far as it 
 goes to the depression of the mercantile interest, so far it is injurious to the 
 Government; besides, a dependence upon such a combination would be impo 
 Utic, both from its slowness and an certainty. The votes of a few individuals, 
 affected by local, selfish, or adverse politics, might endanger the whole people. 
 Such a dependence ought not to be attributed to the wise tram era of the con- 
 stitution, neither does the language warrant it. But, foreign loans have been 
 mentioned as a proper source for this purpose. The imprudence of placing 
 the common defence of a nation on the will of those \yho have no interest in 
 its welfare, is a good answer to this observation. Would it be prudent to 
 trust a foreigner, perhaps a rival, if not an enemy, with your supply of what 
 has emphatically been called the sinews of war? Would it not expose us 
 to exorbitant demands, and often a refusal? Many adventitious circumstan- 
 ces^of a '.var, increasing demands from other quarters, scarcity of coin, and 
 difficulty of communication, as well as the intrigues of courts, all loudly op- 
 pose the measure, as contrary to the spirit and meaning of a provision for the 
 common defence and general welfare. The only resort, then, he conceived, 
 was a timely provision to secure institutions at home, from which loans might 
 be obtained at all times, on moderate terms, and to such amount as the neces- 
 sity of tie State might require. But, gentlemen say that the constitution 
 does not expressly warrant the establishment of such a corporation. If by cx- 
 prccsly, express words are meant, it is agreed that there are no express words; 
 and this is the case with most of the powers exercised by Congress: for, if the 
 doctrine of necessary implication is rejected, he did not sec what the supreme 
 
50 BANK OF THE UNITED STATES. 
 
 Legislature of the Union could do in that character. If this power is not 
 clearly given in the constitution, by necessary implication, there is a necessary 
 end proposed and directed, while the common and usual necessary means to 
 attain that end are refused, or, at least, not granted. 
 
 Mr. Boudinot was firmly of opinion that a National Bank was necessary j 
 the means, without which the end could not be obtained. Theory proved it 
 so in his opinion* and the experience of the Union, in a day of distress, had 
 fully confirmed the theory. The struggles of the friends of freedom, during 
 the late contest, had nearly been rendered abortive, for want of this aid. That 
 danger which was then so hardly avoided, became a solemn memento to this 
 House, to provide against a similar case of necessity. This was the time to 
 do it with advantage, being in such profound peace. He had not heard any 
 argument by which it was proved that either individuals, private banks, or 
 foreigners, could with safety and propriety be depended on as the efficient 
 and necessary means for so important a purpose- Although money was at 
 present plenty in Europe, and might be borrowed on easy terms, it might not 
 be so to-morrow, in case a war should break out and our necessities become 
 pressing. He again enumerated the harmless qualities with which it was pro- 
 posed to vest the bank corporation, by the bill on the table r for the important 
 purposes of the common defence and general welfare. Gentlemen had not 
 yet pointed out any danger arising to the community, neither did he think it 
 was possible that any could ever be mentioned, equal to those of suffering the- 
 Government to depend upon individuals or private banks for loans, in a day 
 of distress. 
 
 But it was said that this bill gave the corporation a right to hold real pro- 
 perty in a State, which Congress had no po\yer to do. The terms of the bill 
 are misapprehended 5 this is a right which, it has been shown, attaches to the 
 citizens individually, or in their associated capacity; the bill therefore does 
 no more than to vest a number witli an artificial single capacity, under a ficti- 
 tious name, and by that name to hold lands, make by-laws, &c. &c. all 
 which they might have done before, as citizens r in a collective capacity. So 
 far from giving a new power, their original individual rights are limited for 
 1he public safety, as to the amount of their stock and the duration of their 
 existence. 
 
 Mr. Boudinot then proceeded to cite numerous instances of powers exer- 
 cised by Congress during the last two years, deduced under the constitution 
 by necessary implication, to show the utter impossibility of carrying any one 
 provision of that authority into execution, for the benefit of the people* with- 
 out this reasonable latitude of construction. He also* adverted to some instan- 
 ces of the like conduct, under the former confederation. It had been urged* 
 that the new Congress had no rights or powers but what had been vested in, 
 and given to them by, the individual States, and therefore they could not ac- 
 cept a cession from Great Britain, by the treaty of peace, of the lands ex- 
 tending to the Lake of the Woods, because not before included in any indi- 
 vidual State. Every member was soon convinced of the absurdity of this 
 argument, and by a necessary implication established the power of the con- 
 federated Legislature. During the war, the eommander-in -chief gave a 
 passport to a British officer,, to transmit clothing to the British prisoners at 
 Lancaster. He accordingly conveyed a very large quantity of British goods 
 into Pennsylvania, for that purpose, which, being directly against an express 
 law of that Siate, they were seized and condemned by the proper magistrate*. 
 On a complaint to the Legislature of the State, they referred the same to their 
 judicial officers, upon whose report, (that Congress being vested with the 
 power of declaring war, the right of giving safe passports to an enemy, was 
 necessarily implied, which therefore was duly exercised by their commander- 
 in-chief, though no express povyer was given to him for that purpose,) the 
 Legislature declared their law, directing the condemnation of the goods, void,. 
 ab-mitio, and the judgment of condemnation had no effect. 
 
 This was also the rule that governed this House, with regard to the re- 
 movability of officers by the President, and the authority given to a council 
 
CHARTER OF 1791. 1 
 
 to legislate for the Western territory. In fine, he concluded that it waa 
 universally understood, that, whenever a general power was given, especially 
 to a supreme Legislature, every necessary means to carry it into execution 
 were necessarily included. This was the common sense of mankind, without 
 which it would require a multitude of volumes to contain the original powers 
 of an increasing Government, that must necessarily be changing its relative 
 situation every year or two. 
 
 If power was given to raise an army, the making provision for all the neces- 
 sary supplies arid incident charges were included. If a navy was to be 
 formed, the manning and supplying the war-like stores are necessarily under- 
 stood. If a power is given to borrow money, a right to mortgage or pledge 
 the public property to secure the re-payment, is understood to be vested in 
 the borrower. Take up the present statute book, and every page will afford 
 evidence of this doctrine. Examine the law, with regard to crimes and pun- 
 ishments: under the power of establishing counts, we have implied the power of 
 punishing the stealing and falsifying the records, and ascertained the punish- 
 ment of perjury, bribery, and extortion. Under the power of regulating trade, 
 we have accepted cessions of real estate, and built light houses, piers, &c. 
 All this is under the doctrine of necessary implication for the public good, and 
 in cases not so strong as the Present: and on tne exercise of which no gentle- 
 man thought proper to start this objection. 
 
 This construction appears so natural and necessary, that the good sense of 
 every gentleman on the floor has hitherto led him to proceed on this principle, 
 ever since we began to legislate. What principle of the constitution does it 
 destroy? It gives nothing lhat can affect the right of any State or citizen. 
 Indeed, it has been said, that it is exercising a high act of power. He thought 
 it had been shown to be rather of the inferior kind. But allow the position, 
 and who so proper, as the Legislature of the whole Union, to exercise such a 
 power, for tne general welfare? It has also been said, that this power is a 
 mere conveniency, tor the purpose of fiscal transactions, but not necessary to 
 attain the ends proposed in the constitution. This is denied, and at best is a 
 mere matter of opinion, and must be left to the discretion of the Legislature to 
 determine. 
 
 Mr. Boudinot said, he should now conclude what he had to say, had not 
 an honorable gentleman (Mr. Jackson) brought forward the observations of 
 ihe author of the federalist, 2d volume, pages 7-2,73, and 74, to show a different 
 contemporaneous exposition of the constitution, and charge the author, who, he 
 alleged, was said to be also the author of the present plan before the House, 
 with a change of sentiment. As this gentleman is not here to speak for him- 
 self, he ought to have the next best chance, by having what he then wrote 
 candidly attended to, especially as gentlemen allow him to be good authority. 
 Mr. Boudinot read only part of the 73d page referred to by Mr. Jackson, in these 
 words: Had the convention attempted a positive enumeration of the powers 
 " necessary and proper for carrying their other powers into effect, the attempt 
 44 would have involved a complete digest of laws on every subject to which 
 
 that object, and be often properly varied, whilst the object remains the 
 '* same." How these sentiments can be said to be a different contemporaneous 
 exposition, must be left to the House to determine. Mr. Boudinot then beg- 
 ged the indulgence of the House to hear the same gentleman, when arguing 
 expressly on that part of the constitution now under consideration; and then 
 read the pages 144, 5, and 6, of the first volume of the Federalist, which were too 
 long to be inserted. He declared that, in his opinion, it was impracticable to 
 put together language in the same length, that could more forcibly and point- 
 edly elucidate and prove the construction contended for, in support of the 
 bill on the table. There remained yet but two objections, to which Mr. Bou- 
 dinut would detain the House any longer. 
 
52 BANK OF THE UNITED STATES. 
 
 The Gentleman from Georgia (Mr. Jackson) had charged the measure with 
 establishing the commercial interest, to the great injury of the agricultural. 
 If this was true, he never would agree to it, for he considered the agricultural 
 interest, in America, as its great and sure dependence. Mr. Boudinot con- 
 fessed that, so far from seeing these measures in this paint of liglft, he could 
 not bring his mind to comprehend how the commercial interests of a country 
 could be promoted without greatly advancing the interests of agriculture. 
 Will the farmer have any temptation to labor, if the surplus of what he raises, 
 beyond his domestic consumption, is to perish in his barn, for want of a mar- 
 ket? Can a market be. obtained without the merchants? If commerce flour- 
 ishes, the merchants increase, and, of course, the demand for the produce of 
 the land; but, if the mercantile interests fail, there is none to export the sur- 
 plus produced by agriculture. If the farmer should undertake to export his 
 own produce, he could not give his whole attention to his affairs; or, if the 
 merchant should attempt to raise the grain he wanted, he could not carry on 
 his merchandise; the one interest depends on the other; a separation destroys 
 both. 
 
 But the incapacity of the bank to extend its influence to the extremes of 
 the Union, has been argued, from the gentleman never haying seen a note of 
 the present Bank of North America in Georgia; he therefore concludes that 
 bank has never been of any service to her agricultural interests. Mr. Boudi- 
 not said that he drew very different conclusions from this fact; he supposed 
 that, by means of the bank, the traders with Georgia had been enabled to send 
 her the precious metals, while the. bank paper had answered their purposes 
 nearer home, where they circulated with undoubted credit. He instanced a 
 case of a Philadelphia merchant, who was possessed of 100 in gold, and 
 .100 in credit, at the bank; the merchant wanted 100 worth of rice, of a 
 Georgia planter, and the like value of flour, of a Pennsylvania farmer. When 
 he purchased the one of the Georgian, he could safely pay him the whole in 
 gold, while he found the Pennsylvania!! would as readily receive the bank 
 paper for his flour. But had there been no bank, he could have purchased but 
 50 worth of each, and the Georgian and Pennsylvanian both have gone 
 without a market for the residue. In short, the whole Union might be liken- 
 ed to the body and limbs; you cannot aid and comfort one, but the other must 
 be likewise benefitted. 
 
 He said it was, however, difficult and impracticable to show, that every 
 measure adopted by the Government should have an effect perfectly equal, 
 over so extensive a territory as that of the United States; it was sufficient, 
 if, upon the whole, the measures of Government, taken altogether, produced 
 the desired equality. 
 
 The last objection was, that, by adopting this bill, we exposed the measure 
 to be considered and defeated by the judiciary of the United States, who might 
 adjudge it to be contrary to the constitution, and thereby void, and not lend 
 their aid to carry it into execution. This, he alleged, gave him no uneasiness. 
 He was so far from controverting this right in me judiciary, that it was his 
 boast and his confidence. It led him, he said, to greater decision on all sub- 
 jects of a constitutional nature, when he reflected that, if from inattention, 
 want of precision, or any other defect, he should do wrong, there was a 
 power in the Government which could constitutionally prevent the operation 
 of such wrong measure from affecting his constituents. He was legislating for 
 a nation, and for thousands unborn, and it was the glory of the constitution 
 that there was a remedy, even for the failures of the supreme legislature 
 itself. 
 
 Upon the whole, then, he said, that, on taking the power in question in any 
 point of view, and giving the, constitution the fullest consideration, under the 
 advantages of having the objections placed in the strongest point of light by 
 the creat abilities of the gentlemen in the opposition, he was clearly in favor 
 of the bill; as to its expediency, there could be little doubt on the minds of 
 any gentleman, and unless more conclusive arguments could be adduced to 
 show its unconstitutionally, he should, in the end, vote for the passing of the 
 bill. 
 
CHARTER OF 1791. Q$ 
 
 FEBRUARY 5. 
 
 Mr. SMITH, of South Carolina, observed, that he considered it his duty to 
 offer the reasons which should influence him in giving his vote on this occa- 
 sion. He had wished amendments to the bill, as some parts of it, he confess- 
 ed, did not perfectly please him, but his wishes having been overruled, the 
 question now is, whether the bill shall pass r Though he came from the 
 Southward of the Potomac, the principle of the bill met his approbation. It 
 would be a deplorable thing, said he, if this Government should enact a law 
 subversive of the constitution, or that so enlightened a body as the Senate of 
 the United States should, by so great a majority as were in favor of this bill, 
 pass a law so hostile to the liberties of this country, as the opposition to this 
 measure have suggested the bank system to be; and it would be very extraor 
 dinary if an officer of this Government, who has produced a performance 
 explanatory of the constitution, of such celebrity as to be resorted to as an 
 authority, should be so inconsistent with himself, as to propose a law entirely 
 subversive of the principles laid down in his able defence of the constitution. 
 
 He then adverted to the objections drawn from that article of the constitu 
 tion, that no preference shall be given to one port over another; he showed 
 that the clause was inferred for a particular purpose, and could not be cited 
 as a rule not to be deviated from, as a preference was, and must be, necessa- 
 rily, given to one port over another. He produced numerous instances in 
 point: in consequence of various clauses in the revenue laws, general regula- 
 tions sometimes operate partially; and commercial arrangements, apparently 
 unequal, produce the good of the community at large. 
 
 In reference to construing the constitution, he observed that the present 
 moment, when the powers of the Government were assailed from various 
 quarters, he conceived the most improper to contract those powers. 
 
 The right to construe the constitution, he argued from the principles ad- 
 vanced by Mi-. Madison, in the debate on the power of removability, and 
 read sundry observations from Lloyd's Register, made by that gentleman, 
 corroborative of this sentiment. Those arguments, he conceived, applied 
 very aptly to the. present subjecr. 
 
 Matters of a fiscal nature necessarily devolve on the General Government, 
 and he urged, that every power resulting from the acknowledged right of Con- 
 gress to control the finances of this country, must be as necessarily implied, 
 as in the case of the power of removability. 
 
 He then alluded to the expediency of a national bank. The Secretary gave 
 notice, in his first report, that this plan was in contemplation. Nothing was 
 ever read with greater avidity, and, though it is now more than a year since 
 this intimation was given, yet, no objections have been ottered against it, either 
 by the States, or by individuals; even the State of North Carolina has not 
 mentioned it. [rferc. Mr. BLOODWORTH (if he was not misunderstood) 
 informed Mr. Smith that the report had not been seen by the LegisL 
 ture of North Carolina.] Mr. Smith said he was sorry for it; and then pro- 
 ceeded to notice some partial quotations made by Mr. Jackson, from Dr. 
 Smith's Wealth of Nations, against bank systems. He said he could have 
 wished the gentleman had been more copious in his quotations from that au- 
 thor; if lie had, he. would have found that that author has fully demonstrated 
 their utility. 
 
 He noticed the division of opinions on the subject of a national bank, in the 
 city of Philadelphia; he supposed ideas of personal advantage induced these 
 opposing sentiments; he, however, thought this subject should be taken up 
 utogether on general principles, and, even if its immediate influence should 
 
 tate the management of the finances? This, he thought, had been made appa- 
 rent. This is the opinion of the Secretary of the Treasury, after due and ma- 
 ture consideration of the subject. He certainly enjoya the best mean* for 
 
(34 BANK OF THE UNITKD STATES. 
 
 forming an opinion; he is at the head of the fiscal department, and deservedly 
 enjoys the public confidence; very little has been offered to disprove his sen- 
 timents on this part of the question, and the inexpediency of the measure 
 should be clearly proved before the plan is rejected: for an officer who deser- 
 vedly enjoys the public confidence, is entitled to the support of the Legisla- 
 ture, in those plans which are expedient and constitutional. 
 
 Mr. Smith mentioned instances in which Congress exercised power by im- 
 plication, and observed that this was necessary to the execution of the duties 
 which devolve on the Government by the constitution. The power to esta- 
 blish a national bank must reside in Congress, for no individual State can ex- 
 ercise any such power; the right of no particular State, therefore, is infringed 
 by the institution. It had repeatedly been said that Philadelphia would de- 
 rive peculiar advantages from the Bank of the United States; but, he observ- 
 ed, if the present plan should fail, it is a question whether the stockholders 
 of the Bank of North America would not derive greater advantages from the 
 necessity, which, in that case, Government would be under, of resorting to 
 them for loans. The institution, as before observed, is founded on general 
 principles, and will, undoubtedly, in its operation, prove of general utility. 
 
 Mr. STOXE said, if, upon questions like the present, he had given pain to 
 members he regarded, they might be assured the pain was reciprocal. Let 
 us cherish mutual toleration. We might conceive that each pursued improper 
 systems from the purest motives. We differ in our ideas of Government, and 
 our sense of the sacredness of the written compact. We varied widely in our 
 opinions of the direction of this Government. The great lesson of experi- 
 ment would show who was right; but we are influenced in our habits of think- 
 ing by our local situations, and, perhaps, the distinct interests of the States 
 we represent. He observed, that, upon the present occasion, the opinions 
 respecting the constitution seem to be divided by a geographical line, dividing 
 the continent. Hence, it might be inferred that other considerations mixed 
 with the question; and it had been insinuated that it was warped by the future 
 seat of Government. But other causes may be assigned for the diversity of 
 sentiment: the people to the Eastward began earliest in favor of liberty; they 
 pursued freedom into anarchy; starting at the precipice of confusion, they are 
 now vibrating far the other way. He said that all our taxes are paid by the 
 consumers and manufacturers; those taxes are all bounties upon home manu- 
 factures. The people to the Eastward are the manufacturers of this country; 
 it was no wonder that they should endeavor to strengthen the hands of a Go- 
 vernment by which they are so peculiarly benefitted. 
 
 It is a fact, that the greatest part of the continental debt has travelled east- 
 ward of the Potomac. This law is to raise the value of the continental paper. 
 Here, then, said he, is the strong impulse of immediate interest in favor of the 
 bank. He took notice of the distinction made by the plan of the bill, between 
 continental and State paper. The State paper, on account of partial payments 
 of interest, still remained in the respective States. But this could not, by 
 the present system, be subscribed; so that the Southern States were deprived 
 of the advantage that might have been given to the only paper they have. But, 
 he said, if gentlemen charge us with defending the seat of Government, let 
 them remember that this betrays consciousness of an attack. If they believe 
 that this scheme tends to break the faith of the Union, pledged to the Poto- 
 mac, it is no wonder they suppose we oppose it upon that ground. He would 
 not have mentioned this subject, had it not been hinted at. But let the whole 
 of it come forth; let gentlemen consult their own bosoms; let the public de- 
 cide the truth of his observations. He hoped he should not be suspected of 
 any bias; that, so uniform had been his conduct upon all questions turning upon 
 principles similar to the present, that every member in the House, he believ- 
 ed, had conjectured rightly of the side he would take, before he had uttered 
 a word upon the subject. When implication first raised its head in this 
 House, he started from it, as a serpent which was to sting and poison the 
 constitution, He felt in unison with his country. The fears, the opinions. 
 
CHARTER OF 1/91. ^5 
 
 *he jealousies of individuals and of States, had been explained by a gentle- 
 man from Virginia; [Mr. Madison] he should only remark, that all those 
 who opposed the Government dreaded this doctrine; those who advocated it 
 declared that it could not be resorted to, and all combined in opinion that it 
 ought not to be tolerated. Never did any country more completely unite in 
 any sentiment, than America in this: * 4 That Congress ought not to exercise, 
 by implication, powers not granted by the constitution." And it is not 
 strange: for the admission of this doctrine destroys the principle of your Go- 
 vernment at a blow; it at once breaks down every barrier which the federal 
 constitution had raised against unlimited legislation. He said that necessity 
 was the most plausible pretext for breaking the spirit of the social compact; 
 but the people of this country have anticipated that pretext,- they have said to 
 the ministers of this country, " we have given you what we think competent 
 powers, but, if experience proves them inadequate, we will enlarge them; but, 
 in the mean time, dare not usurp those which we have reserved. ' 
 
 It is agreed, on all hands, that the power to incorporate the subscribers to 
 a bank is not expressly granted; and although gentlemen have agreed that 
 it is implied; that it is an incident; that it is a means for eft'ectuating pow- 
 ers expressly granted,, yet they are not agreed as to the particular power 
 to which this is an incident. They admit that the sweeping clause in the 
 constitution confers no additional power. But, if he understood the gen- 
 tlemen, several of them were of opinion that all governments, instituted for 
 certain ends, draw to them the means of execution as of common right. The 
 doctrine would make ours but a short constitution. [Here he read the pre- 
 amble] and then said, here is your constitution! Here is your bill of rights! 
 Do these gentlemen require any thing more respecting the power of Congress, 
 than a description of the ends of Government: 1 And if, of right, they can 
 carry these mto effect, will they regard the means, though they be expressly 
 pointed out? But, 1 would ask, is there any power under heaven which 
 could not be exercised within the extensive limits of this preamble? 
 
 The convention might have stopped here, and there was no need, accord- 
 ing to the doctrine of the gentlemen, to point out any of the means for the 
 ends mentioned in the preamble. That portion of the constitution wh'ch, by 
 all America, has been thought so important, according to their logic, would, 
 become a dead letter; but the preamble, in fair construction, is a solemn 
 compact that the powers granted shall be made use of to the ends thereby 
 specified. He then reprobated in pointed terms the latitude of the principles 
 premised. He said, that the end of all government is the public good, and 
 if the means were left to legislation, all written compacts were nugatory. He 
 observed, that die sober discretion of the Legislature, which in the opinions 
 of gentlemen ought to be permanent, was the very thing intended to be curbed 
 and restrained by our constitution. 
 
 He then declared that our form of government not only pointed out the 
 ends of government, but specified the means of execution. He said, we may 
 make war this would draw to it the power of raising an army and navy, 
 laying taxes, establishing a judiciary, &c. But the spirit of the constitution, 
 in this respect, had been well explained by Mr Madison, and he should not 
 recapitulate. 
 
 He said, a gentleman from South Carolina, [Mr. SMITH] had remarked, 
 that all our laws proceeded upon the principle of expediency that we were 
 judges of that expediency; as soon as we gave it as our opinion that a thing 
 was expedient, it became constitutional. What, then, said he. remains of your 
 constitution, except its mode of organization? We may look into it to refresh 
 our memories, respecting the times, places, and manner, of composing the Go- 
 vernment; that, as to the powers of Congress, were he of that gentleman's 
 opinion, he would never look into it again. Gentlemen see the difficulties 
 ot their theories, and are obliged to confess that these incidental powers ere 
 not easily defined. They rest in the sober discretion of the Legislature. 
 
 One gentleman [Mr. AMES] has said, no implication ought to be made 
 n^ainstthe law of nature, against rights acquired, or against powers pre-occu- 
 
 if 
 
BANK or THE UNITED STATES 
 
 pied by the States; that it is easier to restrain than to give competent powers* 
 of execution. Now, these notions are hostile to the principle ot our Govern- 
 ment, which is only a grant of particular portions ot power, implying a nega- 
 tive to all others. It has been showr* that the ends of government will in- 
 clude every thing. If gentlemen are allowed to range, in their sober discre- 
 
 is made to imply all powers. But, strange to tell, America forgot to guard 
 it, by express negative provisions. Is there any difference, in effect,, between 
 lodging general powers in a government, and permitting the exercise of them 
 by subtle constructions? He said there was a difference; in the one case the 
 the people fairly gave up their liberty and stood prepared; in the other, they 
 were unexpectedly tricked out of their constitution. 
 
 The preceding remarks, (he observed) showed how dangerous is the doc 
 trine of implication, and upon what small data ingenuity can raise the most 
 dangerous superstructure. He said he should now take a view of those pre- 
 cedents in the former and present Congress,, which are relied on to justify the 
 present measure. 
 
 1st. The Bank of North America. Here he stated the distressful and criti- 
 cal situation of America at that period; he remarked that it was at the declen 
 eion of the continental money. He showed that there were no powers in 
 the confederation, to which even (according to the reasoning of the other side) 
 this povyer could be incidental, but what required the vote ot nine States; that 
 the ordinance passed by a vote of seven States, which showed that necessity 
 alone gave birth to that measure. He showed the dissimilarity of the situa- 
 ation of the former and this Congress^ and the difference in their powers, and 
 consequently in the dangers to be apprehended from the encroachment of 
 either^ 
 
 3d. The redemption of our prisoners at Algiers. This comes within the 
 power to regulate trade. If, said he, we are not capable of redeeming, by 
 the best means in our power, our citizens, our trade may be entirely ruined t 
 and hence the law which shall' be made for their redemption would be necessary 
 and proper. But, by the constitution, the Executive may make treaties, these 
 may be general, or for a particular object; and the Legislature may effectuate 
 them by grants of money. 
 
 3d. We have bought certificates and not destroyed them. This they say 
 is implied from the power of paying the debts, 
 
 He asked if, before the purchase, the certificates were debts due from the 
 United States? And demanded, if, by the purchase, they were divested of 
 that quality? Now (said he) in my judgment, when a debt is fairly cancel- 
 ed, it is as much like a payment as need pe. 
 
 4th. We had no right r except by implication, to give a salary to the Vice 
 President. He said he had voted against the salary, and had been for a per 
 diem allowance, because he thought the Vice President was viewed by the 
 constitution only as President oF the Senate. But this example fails most 
 palpably, as Congress, in the compensations, are not confined, by the constitu- 
 tion, either to a particular sum or mode of payment. 
 
 5th. Congress have made corporations, and exercise complete legislation 
 in the Western territory. He said, to answer this case nothing more was 
 necessary than to read the clause in the constitution which gave to Congress, 
 expressly, the power to make all rules and regulations tor them. It seemed 
 to him as if gentlemen were inverting the order of things, by making powers 
 where there were none, and attempting to prove express grants to be impli- 
 cations. 
 
 6th. Our regulations respecting freighters and owners, and between cap- 
 tains and seamen. He had not those regulations correctly in his memory, but 
 he believed them proper and necessary regulations of commerce. 
 
 7th. It has been said, we have exclusive jurisdiction in places belonging 
 to Congress and within the ten miles square. We could erect a bank in either 
 
CHARTER OF 1791. ffi 
 
 of thes^ places; its influence would extend over the continent; the principle 
 tni which we founded this power could not be confined to a particular time 
 or spot of land. Gentlemen ridicule the idea that the exercise of a pervading 
 influence and a general principle should be limited by any particular number 
 of years, or be confined within a fort He said the power of exclusive 
 legislation in those places was expressly granted, and, under its influence, 
 the Congress might exercise complete and exclusive legislation, within those 
 limits; that the power was confined to places. But, if the general powers of 
 this constitution are to be governed by the same rules of construction, and 
 we have no regard to place, it follows tliat Congress can exercise exclusive 
 legislation over this continent. He wa-s asUmsihed at the doctrine. It would 
 be equally reasonable to say that France, because, within her own dominions, 
 and over her own property, she exercised exclusive legislation, that hence she 
 had a right to legislate for the world. 
 
 8th. The power of removal of officers by the President alone. He said it 
 was known he had opposed that doctrine. He left it to be defended by those 
 who had voted for it. But he hoped the gentleman from South Carolina, 
 .[Mr. SMITH] and some other gentlemen who had opposed it, would review 
 the arguments they had used upon that occasion. 
 
 He observed, after taking a view of those precedents, on the danger of lay- 
 ing down improper principles in legislation. How eagerly men grasped at 
 the slightest pretexts for the exercise of power. He shuddered to think what 
 a broad and commanding position this bank will form for farther encroach- 
 ments. 
 
 A gentleman from Massachusetts, [Mr. SEDGWICK] has said, that, when- , 
 ever a power is granted, all the known and usual means of execution are 
 always implied; the idea (he said) had been properly examined by [Mr. 
 GILES,] but he would ask if incorporating the subscribers to a bank was the | 
 known and usual means of borrowing money, especially when the subscriber* ( 
 were not obliged to loan, or of coliecting taxes when no taxes were levied on / 
 the bank? 
 
 But gentlemen tell us, if \ye tie up the constitution too tight, it will break; \ 
 if we hamper it, we cannot stir; if we do not admit the doctrine, we cannot ) 
 legislate at all. And with a kind of triumph, they sav, that implication is / 
 recognised by the constitution itself, in the clause wherein we have power to ) 
 make all laws to carry, &c. He said he was ready to meet the gentlemen 
 upon this ground. This clause, he said, was intended to defeat those loose 
 and proud principles of legislation which had been contended for. It was 
 meant to reduce legislation to some rule. In fine, it confined the Legislature 
 to those means that were necessary and proper. 
 
 He said, it would not be pretended that it was necessary and proper for the 
 collection of taxes. Indeed, one gentleman [Mr. AMES] had attempted to 
 show that the payments in specie could not be made, if, by chance, a great 
 quantity of debt suddenly accumulated in a particular place. But it might 
 be remembered that this necessity, if it arrived, was created by the Legisla- 
 ture, and that would be strange reasoning which broke a good constitution, to 
 mend a bad law. No taxes are collected by this bill. 
 
 It would not be necessary and proper, as a mean of borrowing money, 
 because, first, we do not want to borrow money; and if we did, this law, 
 though it may be the probable, it is not the necessary mean : for, if it was the in- 
 terest of the stockholders, they might, and he believed would, refuse to loan. He 
 said that the institution might be defended upon more plausible grounds, if 
 the bank had been taxed, or if a condition to loan money to the public had 
 been made part of the plan. Upon what ground, then, do gentlemen stand? 
 They can only say that they have implied a great ana substantive power in 
 Congress, which gives to the Government or to individuals the influence of 
 15,000,000 dollars, irrevocably, for twenty years, with a power of making by- 
 laws, &c. because there is a probability that this institution may be convenient 
 and agreeable to the operations of Government. He asked, upon parallel prin- 
 ciples, what might Congress not do? He said that the gentleman from Vir- 
 ginia, [Mr. MADISON] pursuing the doctrine in all the forms in which it might 
 appear, had struck upon several cases which were verypointed; an incorpora- 
 
gg BANK OP THE UNITED STATES. 
 
 lion of manufacturers with exclusive privileges; merchants with the same; a 
 national religion. This, a gentleman [Mr. AMES] had said was unfair and 
 extravagant reasoning; and yef, in five minutes, the gentleman's own reasoning 
 led him to ask, with warmth, it' Congress could not join stocks with a company 
 to trade to Nootka! and he condescended to doubt it" the privileges given to 
 such a company might not be exclusive. He saw clearly, himself, that his 
 theory led to the latter conclusion: for, if expediency, if convenience, facility, 
 if fears of war, if preparations for events which might never happen, can justi- 
 fy an incorporation upon the present plan, the same suggestions, the same 
 logic, will legalize incorporations, with exclusive privileges. The deductions 
 of the gentleman from Virginia are sound and right, and cannot be fairly con- 
 troverted. Congress may then do any thing. Nay, if the principles now 
 advocated are right, it is the duty of the Legislature of the Union to make all 
 laws, not only those that are necessary and proper to carry the powers of the 
 Government into effect, but all laws that are convenient, expedient, and bene- 
 ficial to the United States. Then, where is your constitution? Are we not 
 
 is it? It is found in the sober discretion of the Legislature; it is registered in 
 the brains of the majority. 
 
 He proceeded : I say there is no necessity, there is no occasion, for this 
 bank. The States will institute banks, which will answer every purpose. But 
 a distrust of the States is shown in every movement of Congress. Will not this 
 plant distrusts in the States? Will you gain by this contest? This scheme 
 may give, and I am convinced will give, partial advantages to the States. In 
 the fair administration of our Government, no partial advantages can be 
 given! But, by this bill, a few stockholders may institute banks in particular 
 States, to their aggrandizement, and the oppression of the others. It will swal- 
 low up the State banks; it will raise in this country a moneyed interest, at the 
 devotion of Government; it may bribe States and individuals. He said, 
 gentlemen asked, who would be offended or hurt by this plan? Have we 
 heard any complaint against it? Have the newspapers reprobated it? These 
 questions had no influence on his mind. He said, it was one of those sly and 
 subtle movements, which marched silently to its object; the vices of it were 
 at first not palpable or obvious; but, when the people saw a distinction of 
 banks created; when they viewed, with astonishment, the train of wealth 
 which followed individuals, whose sudden exaltation surprised even the pos- 
 sessors, they would inquire how this all came about They will then examine 
 into the powers by which these phenomena have arisen, and they will find, 
 they will reprobate the falsehood of the theories of the present day. 
 
 He said that gentlemen had told us of the sudden irruptions of enemies. 
 When those necessities arrive, it is time enough to make use of them to break 
 your constitution. But gentlemen say, upon emergencies, the bank will loan 
 money. We differ in opinion. I think when we want it most, the bank will 
 be most unable and unwilling to lend. If we are in prosperity, we can borrow 
 money almost any where; but, in adversity, stockholders will avoid us with as 
 much caution as any other capitalists. 
 
 But a gentleman [Mr. AMES] tells us not to be alarmed; the bank will not 
 eat up liberty. He said he was not afraid; he was not under any apprehension 
 that all the little influence that Congress possessed, would destroy the great 
 spirit of American liberty. The body of the People would laugh and ridi- 
 cule any attempt to enslave them; but a conduct which had that tendency 
 might arouse alarming passions. He said there existed at this moment ill 
 blood in the United States, which, to quiet, he would readily agree to enter 
 into a foreign war. America with us, we might defy the world. There was, 
 he said, but one people he was afraid of offending: this was America. He 
 was not afraid of foreign enemies; but the resentment of our own country is 
 always a subject of serious apprehension. He observed, there were other 
 parts of this important and diffusive subject which he might have touched, 
 but he had fatigued himself and the House. 
 
CHARTER OF 1791. gC) 
 
 Mr. SMITH, of S. C. (in explanation) said, as he had been greatly misunder- 
 stood by the gentleman last up, he wished to explain the position he had laid 
 down. 
 
 He had never been so absurd as to contend, as the gentleman had stated, 
 that whatever the Legislature thought, expedient, was therefore constitutional: 
 but he had only argued, that, in cases where the question was, whether a law 
 was necessary and proper to carry a given power into effect, the members of 
 the Legislature had no other guide but their own judgments, from which alone 
 they were to determine whether the measure proposed was necessary and 
 proper to carry the powers vested in Congress into full effect. If, in such 
 cases, it appeared to them, on solemn deliberation, that the measure was not 
 prohibited by any part of the constitution, was not a violation of the rights of 
 any State or individual, and was peculiarly necessary and proper to carry into 
 operation certain essential powers of the Government, it was, then, not only 
 justifiable, on the part of Congress, but it was even their duty to adopt such 
 measure: that, nevertheless, it was still in the province of the judiciary to annul 
 the law, if it should be by them deemed not to result by fair construction from 
 the potters vested by the Constitution. 
 
 FEBRUARY 7. 
 
 Mr. GILES. In the course of discussing the present important question, it 
 has been several times insinuated that local motives, ami not a candid and 
 patriotic investigation of the subject, upon its merits, have given rise to the 
 difference of opinion which has been heretofore manifested in this House. I 
 shall not examine the truth of this observation, but merely remark, that the 
 causes which may have produced the arguments against the proposed measure, 
 whatever they be, can neither add to, or take from, their merit and influence; 
 and, of course, the insinuations might have been spared, without injury to the 
 subject; but, so far as the observation may have been intended to myself, I can 
 truly say, that, if a bias were to influence my conduct, it would rather direct 
 it to favor, than to oppose the proposed measure. This bias would arise from 
 two causes: the one, from the respect which I entertain for the judgments of 
 the majority who advocated the measure; the other, of a more serious nature- 
 I have observed, with regret, a radical difference of opinion between gentlemen 
 from the Eastern and Southern States, upon great governmental questions, and 
 have been led to conclude that the operation of the cause alone might cast 
 ominous conjecture on the promised success of this much valued Government. 
 Mutual concessions appear to be necessary to obviate this effect; and I have 
 always been pleased in manifesting my disposition to make advances; but, from 
 the most careful view of the arguments in favor of the proposed measure, con- 
 sidered under this impression, they do not seem to me sufficient to establish 
 the propriety of its adoption, arid I am therefore impelled, by the joint in- 
 fluence of duty and opinion, to be one in the opposition. 
 
 A gentleman from Massachusetts (Mr. AMES) prefaced his observations with 
 this remark: that it was easier to point out defects, and raise objections, to any 
 proposed system, than to defend it from objections, and prove an affirmative 
 propriety; and warned the House against the effects of arguments of this na- 
 ture, urged in opposition to the measure now under consideration. I agree 
 with the gentleman in this idea generally, but we should reflect, that, in the 
 present case, the address of the arguments in favor of the measure is made 
 to one of the strongest affections in the human mind the love of dominion; 
 and hence we may justly conclude that they will be received and relished with 
 their full and unabated influence. This reflection appears to me to be at least 
 a counterpoise to that remark. 
 
 The advocates of this bill have been called on. and I conceive with propri- 
 ety, to show its constitutionality and expediency, both of which have been 
 doubted by those of the opposition. In support of the first position a multitude 
 of arguments have been adduced, all of which maybe reducible to the follow- 
 ing heads, such as are drawn from the constitution itself: From the incident- 
 ality of this authority to the mere creation and existence of Government; 
 
70 RANK OF THE UNITED STATES. 
 
 from the expediency of (he measure itself; and from the precedents of Con- 
 gress; to which may be added a similar exercise of authority by Congress, 
 under the former confederation. 
 
 Observations arising from the constitution itself, were of tvvo kinds: The 
 right of exercising this authority is either expressed in the constitution, or de- 
 ducible from it by necessary implication. One gentleman only, from Massa- 
 chusetts,(Mr. SEDGWICK> has ventured to assert, that, discarding the doctrine 
 of implication, he could shew that the right to exercise the authority contend- 
 ed for was expressly contained in the constitution. This, I presume, must 
 have been a mistake in language; because the difference between an express 
 and an implied authority appears to consist in this: in the one case, the natu- 
 ral import of the words used, in granting the authority, would, in themselves, 
 convey a complete idea to the mind, of the authority granted, without the aid 
 of argument or deduction : in the other, to convey a complete idea to the mind, 
 the aid of argument and deduction is found* necessary to the usual import of 
 the words used; and that gentleman proceeded with a labored argument to 
 prove, that the authority was expressly granted, which would have been totally 
 useless if his assertion nad been just. 
 
 [Mr. SEDowicKrose to explain. He never conceived the authority granted 
 by the express words of the constitution; but absolutely by necessary implica- 
 tion from different parts of it. ] 
 
 Mr. GILES resumed. I shall not contend as to the assertion, but shall pro- 
 ceed to consider the arguments in favor of the measure, on the doctrine of 
 implication, which, indeed, are those only which deserve consideration. 
 
 In doing this, I shall consider the authority contended for, to apply to that 
 of granting charters of incorporation in general: for I do not recollect any 
 circumstance, and I believe none has been pretended, which could vary this 
 case from the general exercise of that authority. To establish the affirmative 
 of this proposition, arguments have been drawn from several parts of the con- 
 stitution; the context has been resorted to: We, the people of the United 
 States, in order to form a more perfect union, establish justice, ensure domes- 
 tic tranquillity, provide for the common defence, promote the general welfare, 
 and secure the blessings of liberty to ourselves and our posterity, $c. It 
 has been remarked, that here the ends for which the Government was created 
 are clearly pointed out. The means to produce the ends are left to the choice 
 of the Legislature, and the incorporation of a bank is one necessary means to 
 produce these general ends. It may be observed, in reply, that the context 
 contemplates every general object of Government whatever; and, if this rea- 
 soning were to be conclusive, every object of Government would be within 
 the authority of Congress, and the detail of the constitution would have been 
 wholly unnecessary, farther than to designate the several branches of the Go- 
 vernment which were to be entrusted with this unlimited, discretionary 
 choice of means, to produce these specified ends. The same reasoning would 
 apply as forcibly to every clause in the constitution, restraining the authority 
 of Congress, as to the present case, or to any other one in which the constitu- 
 tion is" silent. The only candid construction, arising from the context, ap- 
 pears to me to be this: it is designed, and it is the known office of every mem- 
 ber to point out the great objects proposed to be answered by the subsequent 
 regulations, of which the constitution is composed. These regulations contain 
 the means by which these objects are presumed to be best answered. These 
 means consist in a proper distribution of all governmental rights between the 
 Government of the United States and the several State Government!, and in 
 fixing limits to the exercise of all authorities granted to the Government of the 
 United States. The context, therefore, gives no authority whatever, but only 
 contemplates the ends for which certain authorities are subsequently given. 
 Arguments drawn from this source appear to be ineffectual in themselves, and 
 the reliance of gentlemen upon them indicates a suspicion and distrust of such 
 as may be drawn from other parts of the constitution. The advocates of the 
 bill have turned away from this context, and have applied to the body of the 
 constitution in search of arguments. They have fixed upon the following 
 
CHARTER OF 1791. 7J 
 
 clauses, to all or some one of which, they assert, the authority contended for 
 is clearly incidental: The right to lay and collect taxes, &c. &c.; to provide 
 for the common defence and general welfare, &c.; to borrow money, &c : ; to 
 regulate commerce with foreign nations, &c. The bill contemplates neither 
 the laying nor collecting taxes; and, of course, it cannot be included in that 
 clause. Indeed, it is not pretended, by the bill itself, to be at all necessary to 
 produce either of those ends; the farthest the ide:\ is carried in the bill, is, 
 that it will tend to give a facility to the collection. The terms common defence 
 and general welfare con tarn no grant of any specific authority, and can relate 
 to such only as are particularly enumerated and specified. 7o borrow money. 
 Gentlemen have relied much upon this clause. Their reasoning is, that a right 
 to incorporate a bank is incidental to that of borrowing money, because it cre- 
 ates the ability to lend, which is necessary to effectuate the right to borrow. 
 I am at a loss to discover one single relation between the right to borrow and 
 the right to create the ability to lend, which is necessary to exist between 
 principal and incident. It appears to me that the incidental authority is para- 
 mount to the principal; for the right of creating the ability to lend is greater 
 than that of borrowing from a previously existing ability. I should therefore 
 rather conclude, that the right to borrow, if there be a connexion at all, would 
 be incidental to the right to grant charters ot incorporation, than the reverse of 
 that proposition, which is the doctrine contended for by the advocates of this 
 measure. The same reasoning which would establish a right to create the 
 ability to lend, would apply more strongly to enforce the will, after the ability 
 be created: because the creator would have a claim of gratitude, at least, upon 
 the created ability, which, if withheld, perhaps with justice, might be insist- 
 ed on. 
 
 To regulate commerce with foreign nations. This is, by no means, a satis- 
 factory ground for the assumption of this authority: for, if it be deemed a 
 commercial regulation, there is a clause in the constitution which would abso- 
 lutely inhibit its exercise. I allude to that clause which provides that no pre- 
 ference shall be given by any regulation of commerce or revenue, to the ports 
 of one State over those of another; and it seems to be admitted that one prin- 
 cipal effect to be produced by the operation of this measure will be, to give a 
 decided commercial preference to this port [Philadelphia] over every other 
 in the United States. 
 
 Gentlemen, finding it difficult to show that necessary relation and intimate 
 connexion between the authority contended for, and any one of the specified 
 authorities before mentioned, which would be essential to the establishment 
 of their doctrine, have referred to what has been generally called the sweep- 
 ing clause, and have made deductions from the terms necessary and proper. 
 They have observed, that certain specified authorities being granted, all otfiers 
 necessary to their^execution follow, without any particular specification. This 
 observation may, in general, be true; but its fallacy here consists in its appli- 
 cation to this particular case. It cannot be applied until the exercise ot this 
 authority be proved to be necessarily connected with some one of the pre- 
 viously^ enume rated authorities: and here the argument, as well as the tact, 
 fails. The authority contended for seems to me to be a distinct substantive 
 branch of legislation, and perhaps paramount to any one of the previously 
 enumerated authorities, and should therefore not be usurped as an incidental 
 subaltern authority. 
 
 I am confirmed in this opinion from the indistinct, confused conceptions 
 of gentlemen who advocate the measure. They rely upon the incidentally of 
 this authority, to someone of those particularly specified, and yet have applied 
 it as an incident to several distinct, unconnected subjects of legislation; and 
 thus, distrusting their own conclusions, or as if the inquiry would be too trou- 
 blesome or minute, they leave this ground, and assert that it is incidental to 
 the result of the whole combined specified authorities. Gentlemen must, 
 therefore, view this right through different optics, at different times: or, what 
 I ratherbelieye to be the fact, they have no distinct view of it at all the right 
 having no existence. 
 
72 BANK OF THE UNITED STATES. 
 
 A gentleman from Massachusetts. (Mr. SKDGWICK) finding the usual import 
 of the terms used in the constitution to be rather unfavorable to the doctrines 
 advanced by him, has favored us with a new exposition of the word necessary. 
 He says that necessary* as applicable to a mean to produce an end, should be 
 construed so as to produce tiie greatest possible quantum of public utility. I 
 have been taught to conceive that the true exposition of a necessary mean to 
 produce a given end, was that mean without which the end could not be pro- 
 duced. 
 
 The gentleman'sreasoning, however, if pursued, will be found to teem with 
 dangerous effects, and would justify the assumption of any given authority 
 whatever. Terms are to be so construed as to produce the greatest degree of 
 
 public utility^ " 
 
 utility, when 
 measure may 
 
 These deductions would suborn the constitution itself, ami blot out the great 
 distinguishing characteristic of the free constitution of America, as compared 
 with the despotic Governments of Europe, which consists in having the boun- 
 daries of Governmental authority clearly marked out and ascertained. The 
 exclusive jurisdiction over ten miles square has been adverted to, by one gen- 
 tleman, (Mr. AMES) as a specified authority, to which the one contended for 
 is suggested to be incidental. He has reasoned in this manner: Congress pos- 
 sesses jurisdiction over ten miles square, &c. Congress may, therefore, estab- 
 lish a bank within the ten miles square; and, as principle is not applicable to 
 place. Congress may exercise the same authority any where else. This seems 
 to me to be an ingenious improvement upon sophistical deduction. The gen- 
 tleman, however, should have reflected, that me ground upon which he built 
 the right to exercise this authority, was that of exclusive jurisdiction, and, to 
 extend the principle, it is necessary to extend the right of exclusive jurisdic- 
 tion: without this, the basis of his argument fails, and the superstructure, 
 however beautified, must follow, for the principle, if at all deducible from 
 that source, is expresely confined to place, and cannot operate beyond it. 
 
 1 shall now consider the second resource whence the constitutional right 
 of exercising the proposed authority is derived; its incidentally to the mere 
 creation and existence of Government. It has been observed that, in all 
 governments, there are certain rights tacitly granted, and certain other rights 
 retained; that it is impossible, in framing a constitution, to enumerate every mi- 
 nute governmental right, aw 1 , that sucn an attempt would be chimerical and 
 vain: and, hence, the incidentality of this authority to the mere existence of 
 government is inferred. These observations seem to me to apply to a govern- 
 ment growing out of a state of society, and not in a government composed of 
 chartered rights from previously existing governments, or the people of those 
 governments. I have been taught to consider this as a federal, not as a con- 
 solidated government, and am not prepared or disposed, ai present, to relin- 
 quish that idea. A gentleman from New York, (Mr. LAWRENCE) has re- 
 marked that the government is consolidated quo ad the powers granted, and, 
 of course, quoad their incidents; but he should first have shown that the au- 
 thority contended for is one of those granted, or incidental to some of them, 
 before the application can be made; the observation can have no tendency 
 to establish either of those positions. What effect would this doctrine, if ad- 
 mitted, have upon the State governments? And how would it be relished by 
 them? Their dignity and consequence will not only be prostrated by it, but 
 their very existence radically subverted. A third resource of deducing this 
 constitutional authority has been resorted to the expediency of the proposed 
 measure itself. I presume the great object of the constitution was to distri- 
 bute all governmental rights between the several State governments and the 
 Government of the United States; the expediency, therefore, of the exercise 
 of all the constitutional rights, as they relate to State or General Government, 
 is properly contemplated and decided by the constitution, and not by the 
 governments amongst which the distribution is made. A gentleman from 
 South Carolina (Mr. SMITH) has said, that the expediency and constitution- 
 
CHARTER OF 1791. 73 
 
 ality of the proposed measure cannot be considered separately, because the 
 constitutionality grows out of the expediency: this is but candidly unveiling 
 the subject of that sophistical mask which has been ingeniously thrown over 
 it by some gentlemen: for all the arguments adduced in favor of the measure, 
 from whatever source they arise, if pursued, will be found to rush into the 
 great one of expediency, to bear down all constitutional provisions, and to 
 end themselves in the unlimited ocean of despotism. 
 
 Several gentlemen have said, that this authority may be safely exercised, 
 since it does not interfere with the rights of States or individuals. I think 
 this assertion not very correct; if the States be constitutionally entitled to 
 the exercise of this authority, it is an intrusion on their rights to do an act 
 which would eventually destrov or impede the freest exercise of that autho- 
 rity: for it is totally immaterial whether the effect be produced by the opera- 
 tion of this or by an inhibition in express terms the States may not only in- 
 corporate banks, but may, of right, prohibit the circulation of bank paper 
 within their respective limits; the act, therefore, if it be intended to have an 
 effectual operation, will certainly infringe this right, or exist at the mercy of the 
 State Governments. This reasoning, however, places the subject in another 
 point of view, a little singular; it contemplates the authority contended for as 
 vacant ground, and justifies the tenure by the mere title of occupancy. In 
 almost all the remarks in favor of the measure, gentlemen seem to have for- 
 gotten the peculiar nature of this Government: it being composed of mere 
 chartered authorities, all authority not contained within the charter, would, 
 from the nature of the grant, have been retained to the granting party, and I 
 will venture to assert that this opinion was asine quanon of the adoption and 
 existence of this Government; but, if this opinion had been doubtful, Congress 
 themselves have made an express declaration in favor of this construction, in the 
 proposed amendments to the constitution. Gentlemen have inferred a consti- 
 tutional right to exercise the authority contended for, from a fourth resource 
 the former usages and habits of Congress; in affirmance of this argument, 
 several acts of Congress have been referred to, the power of removal from 
 office, the government of the Western territory, the cession from North Caro- 
 lina, the purchase of West Point, &c. &c. I shall not examine into the pro- 
 propriety of those several acts, though I conceive it would not be difficult to 
 show that they differ materially, upon constitutional grounds, from the one 
 now proposed; I slyill only remark, that, if Congress have heretofore been in 
 the usage and habit of disregarding and violating the constitution, it is high 
 time that that habit and^sage were corrected: I hope and trust that the People 
 of the United States will not tamely see the only security of their rights and 
 liberties invaded and violated, but also see one violation of it, with impunity, 
 boldly urged as an argument to justify another. 
 
 An instance of a similar exercise of authority by the Congress which ex- 
 isted under the former confederation, has been mentioned in favor of its ex- 
 ercise by the present Congress. The argument has been, that, as the powers 
 of the present Congress are greater than those of the former Congress, and 
 the former were competent to the exercise of this right, the present must be 
 more so. It is to be remarked that that act was the child of necessity, and 
 Congress doubted its legitimacy, and the act itself was never confirmed by a 
 judicial decision; and, it should be also remarked, that the same Congress 
 did not pretend to profess the right to punish those who should counterfeit the 
 paper of the bank, and recommended it to the States to confirm the act which 
 they had done, and to pass laws for the purpose of punishing those who should 
 counterfeit the paper; and it is a little remarkable that this circumstance, which 
 is one of the most essential to the existence and operation of this act, is with- 
 held from our view. But, as I think arguments from this source wholly foreign 
 to the subject, I shall make no other remark upon them. I shall now sug- 
 
 fest a few observations respecting the expediency of the proposed measure, 
 n doing this, I shall not say any thing as to the utility of banks in general, 
 nor as to the effects of the banks of England,'Scotland, Holland, &c. &c. I pos- 
 sess not sufficient practical or theoretical knowledge to justify the inquiry. I 
 10 
 
74 BANK OF THE UNITED STATES. 
 
 shall only paint out a few circumstances, which are peculiarly attached to the 
 Government we are now administering, which might vary the application of 
 general rules drawn from the governments of a different nature, and which pos- 
 sess the unquestioned right of granting charters of incorporation. 
 
 In the first place, the right of exercising that authority, by this Government, 
 is at least problematical ; it is no where granted in express terms: the Legisla- 
 ture, therefore, can have no competent security against the judicial decision, 
 but a dependent or a corrupt court. I presume that a law to punish with 
 death those who counterfeit the paper emitted by the bank, will be consequent 
 upon the existence of this act; hence a judicial decision will probably be had 
 of the most serious and awful nature. The life of an individual at stake on 
 one hand: an improvident act of the Government on the other. A distrust, 
 arising from this cause, will forever keep the bank in jeopardy; and the very 
 first trial of this nature will probably subject the bank to a run which it will 
 be unable to stand; for all stockholders will require the greatest possible secu- 
 rity for their money, and distrust of such an institution will be destruction. 
 This observation seems to me to have a peculiar force, from the great propor- 
 tion of paper to that of gold and silver, upon which the bank is proposed to be 
 founded. The peculiar relation between the General and State Governments 
 will naturally produce a contest for governmental rights, until long experience 
 shall settle the present boundaries between them. The present measure ap- 
 pears to me to be an unprovoked advance in this scramble for authority, and 
 a mere experiment how far we may proceed without involving the opposition 
 of the State Governments. It should be remarked, that this Government is in 
 its childhood; it is therefore unfitted for such bold and manly enterprises, and 
 policy would dictate that it should wait at least, until it may have become 
 more matured or invigorated. Two modes of administering this Government 
 present themselves: the one, with mildness and moderation, by keeping within 
 the known boundaries of the constitution: the other, by the creation and opera- 
 tion of fiscal mechanism. The first will ensure us the affections of the People, 
 the only natural and substantial basis of republican government; the other 
 will arise and exist in oppression and injustice will increase the previously ex- 
 isting jealousies of the People, and must be ultimately discarded, or bring about 
 a radical change in the nature of our Government. Having suggested these ob- 
 servations upon the measure in general, I shall now proceed to point out a 
 few objections to the detail of the bill. I think the authority given to the bank, 
 to purchase and hold lands, objectionable. In the first place, I doubted the con- 
 stitutional right of Congress to invest such an authority: the lands within the 
 United States are holden of the individual States, and not of the United States, 
 and that tenure appears to me to be the true ground upon which the right to 
 exercise that authority grows. I believe it is admitted, that, although Congress 
 may naturalize a foreigner, that they cannot authorize him to purchase lands. 
 And I think the case at least as strong, when they first create an artificial 
 person, and then invest the authority; besides, if we have reference to the ex- 
 perience of other countries, we shall find it dangerous to allow incorporated 
 bodies to hold lands at all. The exercise of that right produced great op- 
 pression in England; and nothing but the masterly activity of an absolute 
 frince could apply a competent remedy. A gentleman from Massachusetts 
 Mr. SEDGWICK] has denied that the bank is invested with this right. It is 
 true, it is confined to the mode of purchasing by mortgage, but that is the 
 most effectual mode of purchasing, and the most ruinous to the landholder. 
 
 I will merely mention one other objection without a comment. The au- 
 thority given to make laws not contrary to law or its own constitution; but 
 the most objectionable clause, is that which limits its duration, and pledges 
 the faith of the United States that no other bank shall be established in the 
 meantime. However dangerous and offensive the present measure might 
 prove in its operation, and whatever may be the utility and advantage in any 
 other scheme of banking, which experience may suggest, such a stipulation can 
 not be justified but from the most pointed necessity, and from the maturest 
 deliberation, When I search for the necessity of this measure, it escapes 
 
CHARTER OF 17$ 1. 75 
 
 vne; it is not pretended in the bill itself: the chief stimulus which I can dis- 
 cover to the existence of this measure, is, to give artificial impulse to the value 
 of stock. This is not a sufficient justification. The subject has not been 
 sufficiently considered, and I therefore hope it may be postponed to some fu- 
 ture session of Congress. Many evils may be avoided by such a conduct; none 
 can result from it, 
 
 Mr. GERRY said he should principally confine himself to the objections of 
 the gentleman first up, from Virginia, [Mr. MADISON] not from a disrespect 
 to the observations of other gentlemen in the opposition, but because he con- 
 sidered their arguments as grafts on the original stock of those urged by the 
 gentleman alluded to,- and, if the trunk fall, its appendages must fall also. 
 
 The objects of the bill, he said, were to render the fiscal administration 
 successful,; to give facility to loans, on sudden emergencies; and to benefit 
 trade and industry generally; and that these were objects of high importance, 
 had not been denied, neither had it been asserted that they ought not, if possi- 
 ble, to be attained. 
 
 It is objected, however, that the mode proposed by the bill is vnconslitu- \ 
 tiomil, and the bill itself defective. 
 
 The mode proposed is a national bank; to establish which, he thought Con- 
 gress were as competent as either House were to adjourn from day to day. 
 
 It is said that Congress have no power relating to this subject, except what 
 is contained in the clauses for laying and collecting taxes, imposts, excises, 
 &c.; fur borrowing money, and for making all laws necessary and proper for 
 carrying these powers into effect; and that these do not authorize the esta- 
 blishment of a national bank. 
 
 To ascertain thi*, the gentleman from Virginia proposes a candid interpre- 
 tation of the constitution, which we shall agree to, and he offers to assist us 
 with his rules of interpretation: for his good intentions in doing which, we 
 give him full credit; but, as he acknowledges that he has been long decided 
 against the authority of Congress to establish a bank, and is therefore prej?*- 
 diced against the measure; as his rules, being made for the occasion, are the 
 result of his interpretation, and not his interpretation of the rules; as they 
 are not sanctioned by law exposition, or approved by experienced judges of 
 the law; they cannot be considered as a criterion for regulating the judgment 
 of the House, but may, if admitted, prove an ignis fatidis, that may lead to 
 destruction. 
 
 We wish not, however, by establishing our own rules of interpretation, to 
 enjoy the privilege which is denied to the gentleman, but will meet him on 
 fair ground, by applying rules, which have the sanction mentioned; and as the 
 learned Judge Blackstone has laid down such, it is presumed the gentleman 
 from Virginia will not contend for a preference, or refuse to be tried by this 
 standard. 
 
 The Judge observes, " that the fairest and most rational method to inter 
 " pret the will of the legislator, is^ by exploring his intention at the time when 
 '* the law was made, by signs thiTmost natural and probable; and these signs 
 44 are either the words, the context, the subject matter, the effect and conse- 
 * fc quences, or the spirit and reason of the law." With respect to words, the 
 Judge observes, that " they are generally understood in their usual and most 
 44 ordinary signification, not so much regarding the grammar, as their general 
 41 and popw/aruse." 
 
 The gentlemen on different sides of the question do not disagree with respect 
 to the meaning of the terms taxes, duties, imposts, excises, &c. or of borrow- 
 ing money, but of the word necessity. And the question is, what is the gen- 
 eral and popular meaning of this term? Perhaps the answer to the question 
 will be truly this, that, in a general and popular one, the word does not admit 
 of a definite meaning, but that this varies according to the subject and circum- 
 stances. With respect to the subject: for instance, if the people, speaking ot 
 a garrison besieged by a superior force, and without provisions, or a prospect, 
 of relief, should say, it was under the necessity of surrendering, they would 
 
76 6ANK OF THE UNITED STATES. 
 
 mean a physical necessity, for troops cannot subsist long without provisions, 
 But, if speaking of a debtor, the people should say he was frightened by his 
 creditor, and thus was reduced to the necessity of paying his debts, they would 
 mean a legal, which is very different from a physical necessity: for, although 
 the debtor, by refusing payment, might be confined, he would be allowed sub- 
 sistence, and the necessity he was under to pay his debts would not extend 
 beyond his confinement. Again, if it should be said that a client is under 
 the necessity of giving to hislawyer more than legal fees, the general popular 
 meaning of necessity would, in this instance, be very different from that in the 
 other the necessity would neither be physical nor legal, but artificial; or, if 
 I may be allowed the expression, a long robe necessity. 
 
 The meaning of the word " necessary" varies also, according to circum- 
 stances: for, although Congress has power to levy and collect taxes, duties y 
 &c. to borrow money, and to determine the time, quantum, mode, and every 
 other regulation " necessary- 7 and proper for supplying the treasury, yet the 
 people would apply a different meaning to the word necessary, under differ- 
 ent circumstances. For instance, without a sufficiency of precious metals 
 for a medium, laws regulating an artificial medium would be generally thought 
 necessary for carrying into effect the power to levy and collect taxes; but if 
 there was a sufficiency of such metals, those laws would not, generally, be 
 thought necessary. Again, if specie was scarce,, and the credit of the Go- 
 vernment low ? collateral measures would be, by the People, thought neces- 
 sary for obtaining public loans; but not so, if the case was reversed. Or, if 
 part of the States should be invaded and over-run by an enemy, it would be 
 thought necessary to levy on the rest heavy taxes, and collect them in a short 
 period, and to take stock, grain, and other articles, from the citizens, without 
 their consent, for common defence; but in a time of peace and safety, such 
 measures would be supposed unnecessary. Instances may be multiplied in 
 other respects, but it is conceived that these are sufficient to show that the 
 popular and general meaning of the word *' necessary," varies according to 
 the subject and circumstances. 
 
 The second rule of interpretation relates to the context, and the Judge con- 
 ceives, that, " if words are still dubious, we may establish their meaning by 
 *' the context: thus, the preamble is often called in to help the construction of 
 4 * an act of Parliament." The constitution, in the present case, is the great law 
 of the People, who are themselves the sovereign legislature; and the preamble 
 is in these words: " We, the People of the United States, in order to form 
 " a more perfect union, establish justice, ensure domestic tranquillity, pro- 
 " vide for the common defence, promote the general welfare, and secure the 
 " blessings of liberty to ourselves and our posterity, do ordain and establish 
 " this constitution for the United States of America*" 
 
 These are the great objects for which the constitution was established, and, 
 in administering it, we should always keep them in view. And here it is re- 
 markable, that, although "common defence and general welfare" are held up 
 in the preamble, amongst the primary objects of attention, they are again 
 mentioned in the eighth section of the first article, whereby we are enjoined, 
 in levying taxes, duties, &c. particularly to regard " the common defence and 
 general welfare." Indeed, common sense dictates the measure: for, the se- 
 curity of our property, families, and liberty, of every thing dear to us, depends 
 on our ability to defend them. The means, therefore, for attaining this ob- 
 ject, we ought not to omit, a year, a month, or even a day. if we could avoid 
 it; and we are never provided for defence, unless prepared for sudden emer- 
 gencies. Should Government be surprised in this case, it would be as dis- 
 honorable as for a general to be surprised in a state of warfare, and the event 
 to the community may be much more fatal. If provision, then, for sudden 
 emergencies, is indispensable, it must be evident that it will depend, in a 
 great measure, on the ability of Government to command, at all times, for 
 this purpose, a sufficient sum of money, which is justly denominated the 
 sinews of war; and how is this to be effected? JBy emissions of bills of credit? 
 During the Revolution, bills of credit, it must be acknowledged, have done 
 
CHARTER OF 1791. 
 
 Wonders. They have, in conflict with the banks, treasury, anil public credit * 
 of Great Britain, risen superior to them all, and have died a natural deatK 
 We have honored them with a funeral pile; we now bid peace to their manes, 
 and devoutly hope that bills of credit will for ever be extinct in the United 
 States. Are we to depend, then, on taxes* for commanding money in cases 
 of urgent necessity? These, as has been shown by other gentlemen, will be 
 too slow in their operation; unless, indeed, we should levy a tax for drawing 
 into, or locking up, in the treasury, three or four millions of dollars a law 
 which would be universally considered as unnecessary and improper. 
 
 By loans, and loans only, can provision be made for sudden emergencies. 
 But if loans should be made previously to an emergency, the People would be 
 unnecessarily burdened by the interest thereof, and most of the other evils 
 would ensue, that would arise from previous taxes; and if they were to be 
 made as an emergency, without previous arrangements, of whom are we to 
 borrow: Of individual*? These cannot be depended on, as has been fully 
 proved by our own experience at the commencement of the Revolution. Are 
 we to apply to the banks already established in the States, for loans? These 
 can no more be depended on than individuals: for stockholders, having no 
 more attachment to Government than other citizens, would, in cases of pub- 
 lic danger, attend to the preservation of their property, by other means than 
 loaning it to Government. And, moreover, the united capitals of all the 
 banks existing in the Union, would be insufficient for Government: for they 
 do not amount to a million and a half of dollars; and only a part of this could, 
 in any case, be reasonably expected on loan. 
 
 Are we to apply to foreign banks or individuals? These, as has been shown, 
 are too remote; and, if not, we have not been able, without the assistance of 
 an ally, to obtain foreign loans during the war; and, perhaps, the Power, on 
 whose assistance we may rely, would be hostile to us. Such dependence, 
 then, as has been stated, would necessarily leave us in a deplorable state. 
 And it must be evident, that a previous arrangement to aid loans, in cases 
 of sudden emergency, is necessary and proper, in the general and popular use 
 of the term, inasmuch as any other measure, that Congress can adopt, would 
 be inadequate to the purpose of common defence; and what previous arrange- 
 ment can we make so proper as that of a national bank? If gentlemen in the 
 opposition know of any, let them produce it, and let the merits of it be inves- 
 tigated, for it is unreasonable to propose a rejection of this plan, without pro- 
 ducing a better. The plan proposed by the Secretary of the Treasury, wnich 
 is now the subject of discussion, does honor, like all his other measures, both 
 to his head and heart. It will be mutually beneficial to the stockholders and 
 to the Government, and, consequently, to the People. The stockholders, by 
 this plan, will be deeply interested in supporting Government, because three- 
 quarters of their capital, consisting of funded certificates, depend on the ex- 
 istence of the Government, which, therefore, is the prop of their capital the 
 main pillar that supports the bank. Again, the credit of Government, which 
 is immaterial to other banks, is essential to the national bank: for the annual 
 interest of three quarters of its capital, which must form a great share of its 
 profits, will depend altogether on the credit of Government, and produce, on 
 the oart of the stockholders, the strongest attachment to it. On the other 
 hand, it will be for the interest of Government to support the bank, as well 
 on account of the benefits \vh\ch the public will generally derive from the in- 
 stitution, and the profits arising from the shares of Government in the stock, 
 which will be hereafter noticed, as of the supplies of money, which it will be 
 for the interest of the bank to furnish, in cases of urgent necessity. When- 
 ever these exist, Congress may lay a tax for supplying the treasury, and anti- 
 cipate it with certainty, by means of the national bank. It being then our 
 duty to provide for the common defence, in cases of emergency, the provision 
 must evidently be by taxes, loans, or by arrangements for obtaining the latter 
 on the earliest notice; and previous taxes and loans being oppressive, impro- 
 per and unnecessary, the arrangement for aiding loans becomes indispensable, 
 and a bank, of consequence, necessary and constitutional. 
 
78 BANK OF THE UNITED STATES. 
 
 The third rule of the Judge, relative to the' 4 subject matter" of a law, it is 
 unnecessary to apply, because the members agree in their ideas relative to the 
 meaning of the terms taxes, duties, loans, &c. 
 
 The fourth rule, which relates to " effects and consequences," is important, 
 and here the learned Judge observes, that, " as to effects and consequences, 
 k * the rule is, where the words bear none, or a very absurd signification, if 
 4 ' literally understood, we must a little deviate from the received sense of 
 " them." In the present case, the gentleman first up, from Virginia, gave the 
 whole clause, by which Congress are authorized to "make all laws neces- 
 " sary and proper," &c. no meaning whatever; for, they say, the former Con- 
 gress had the same power, under the confederation, without this clause, as the 
 present Congress have with it. The Federalist is quoted on this occasion, but 
 although the author of it discovers great ingenuity, this part of his performance 
 I consider as a political heresy. His doctrine, indeed, was calculated to lull 
 the consciences of those who differed in opinion with him at that time, and 
 having accomplished his object, he is probably desirous that it may die with 
 the opposition itself. The rule in this case, says, that where the words bear 
 no signification, we must deviate a little; and as this deviation cannot be made 
 by giving the words less than no meaning, it must be made by a more liberal 
 construction than is given by gentlemen in the opposition. Thus, their ar- 
 tillery is turned on themselves: for their own interpretation is an argument 
 against itself. 
 
 The last rule mentioned relates to the spirit and reason of the law, and the 
 Judge is of opinion, " that the most universal and effectual way of discover- 
 " ing the true meaning of a law, where the words are dubious, is, by consider- 
 ** in g he reason and spirit of it, or the cause which moved the Legislature to 
 " enact it." The causes which produced the constitution, were, an imper- 
 fect union, want of public and private justice, internal commotions, a defence- 
 less community, neglect of the public welfare, and danger to our liberties. 
 These are known to be the causes, not only by the preamble of the constitu- 
 tion, but also from our own knowledge of the history of the times that preced- 
 ed the establishment of it. If these weighty causes produced the constitution, 
 and it not only gives power for removing them, but also authorizes Congress 
 to make all laws necessary and proper for carrying these powers into effect, 
 shall we listen to assertions, that these words have no meaning, and that this 
 constitution has not mure energy than the old! Shall we thus unnerve the 
 Government, leave the Union as it was under the confederation, defenceless 
 against a banditti of Creek Indians, and thus relinquish the protection of its 
 citizens? Or shall we, by a candid and liberal construction ot the powers ex- 
 pressed in the constitution, promote the great and important objects thereof? 
 Each member must determine for himself. I shall, without hesitation, choose 
 the latter, and leave the People and States to determine whether or not I am 
 pursuing their true interest. If it is inquired where we are to draw the line 
 of a liberal construction, I would also inquire where the line of restriction is 
 to be drawn? The interpretation of the constitution, like the prerogative of a 
 sovereign, may be abused, but from hence the disuse of either cannot be in- 
 ferred. In the exercise of prerogative, the minister is responsible for his ad- 
 vice to his sovereign, and the members of either House are responsible to their 
 constituents for their conduct in construing the constitution. We act at our 
 peril: if our conduct is directed to the attainment of the great objects of Go- 
 vernment, it will Le approved, and not otherwise; but this cannot operate as 
 a reason to prevent our discharging the trust reposed in us. 
 
 Let us now compare the different modes of reasoning on this subject, and 
 determine which is right, for both cannot be. 
 
 The gentleman from Virginia, [Mr. MADISON] has urged the dangerous 
 tendency of a liberal construction. But which is most dangerous, a liberal or a 
 destructive interpretation? The liberty we have taken in interpreting the 
 constitution, \ve conceive to be necessary, and, it cannot be denied to be 
 useful in attaining the objects of it; but, whilst he denies us this liberty, he 
 grants to himself a right to annul part, and a very important part, of the con- 
 
CHARTER OF 1791. -g 
 
 slitution. The same principle that will authorize a destruction of part, will 
 authorize ths destruction of the whole of the constitution; and if gentlemen 
 have a right to make such rules, they have an equal right to make others for 
 enlarging the powers of the constitution, and, indeed, of forming a despotism. 
 Thus, if we take the gentlemaiffor our pilot, we shall be wrecked on the reef 
 which he cautions us to avoid. 
 
 The gentleman has referred us to the last article of the amendment, pro- 
 posed to the constitution by Congress, which provides that the powers not 
 delegated to Congress, or prohibited to the States, shall rest in them or the 
 People. And the question is, what pow r ers are delegated? Does the gentle- 
 man conceive that such only are delegated as are expressed? If so, he must 
 admit that our whole code of laws is unconstitutional. This he disavows, 
 and yields to the necessity of interpretation, which, by a fair and candid ap- 
 plication of established rules of construction to tne constitution, authorizes, as 
 has been shown, the measure under consideration. 
 
 The usage of Congress has also been referred to; and if we look at their 
 acts, under the existing constitution, \vc *hall find that they are, generally, 
 the result of a liberal construction. I will mention but two. The first 
 relates to the establishment of the Executive department, and ives to the 
 President the power of removing officers. As the constitution is silent on 
 this subject, the power mentioned, by the gentleman's own reasoning, is vested 
 in the States or the People: he, however, contended for an assumption of 
 the power, and when assumed, urged that it should be vested in the President, 
 although, like the power of appointment, it was, by a respectable minority in 
 both Houses, conceived that it should have been vested in the President and 
 Senate. His rule of interpretation, then* was, therefore, more liberal than it 
 isnow. In the other case. Congress determined by law, with the sanction of 
 the President, \\hen and where they should hold their next session, although 
 the constitution provide,-; that thi?: power shall rest solely in the two Houses. 
 The gentleman also advocated this measure, and yet appears to be apprehen- 
 sive of the consequences that may result from a construction of the constitu- 
 tion which admits of a national bank. But, from which of these measures is 
 danger to be apprehended? The only danger, from our interpretation, would 
 be the exercise by Congress of a general power to form corporations. But 
 the dangers resulting from the gentleman's interpretations, in the cases alluded 
 to, are very different: for what may we not apprehend from the precedent of 
 having assumed a power on which the constitution was silent, and from hav- 
 ing annexed it to the supreme Executive? If we have this right in one in- 
 stance, we may extend it to others, and make him a despot. And here I think 
 it necessary to declare, that such is my confidence in the wisdom, integrity, 
 and justice of the Chief Magistrate, as that I should be at ease, if my life, 
 liberty, and property, were at his disposal; but this is a trust which I am not 
 authorized to make for my constituents, and as his successor in office will 
 possess equal powers, but may not possess equal virtues, caution with respect 
 to them is necessary. Again, what may be the result of the precedent relating 
 to the session of Congress? If we had a right, by law, to determine where 
 the next Congress should hold their sessions, one Congress may oblige another 
 to sit at Kentucky, or in the intended Yazoo State, under the protection of a 
 Choctaw chief, or his excellency Governor Tallan. It must, therefore, be 
 evident that the usage of Congress, in both instances, is against the gentle- 
 man, and that the dangers, from the precedent of establishing a bank, are, 
 comparatively, small, to those resulting from the other measures referred to. 
 
 The gentleman from Virginia has endeavored to support his interpretation 
 of the constitution by the sense of the federal convention. But how is this to 
 be obtained? By applying proper rules of interpretation. If so, the sense of 
 the convention is in favor of the bill; or, are we to depend on the memorv of 
 the gentleman for an history of their debates, and from thence to collect their 
 sense? This would be improper, because the memories of different gentle- 
 men would probably vary, as they haye already done, with respect to those 
 factsj and, if not, the opinions of th? individual members, who debated, are 
 not to be considered as the opinions of the convention. Indeed, if they were, 
 
80 BANK OF THE UNITED STATES. 
 
 no motion was made in that convention, and, therefore, none could be reject- 
 ed for establishing a national bank. And the measure which the gentleman 
 has referred to was a proposition merely to enable Congress to erect commer- 
 cial corporations, which was, and always ought to be, negatived. 
 
 The gentleman's arguments, respecting the .sense of the State conventions, 
 have as little force as those relating to the federal convention. The debates 
 of the State conventions, as published by short hand writers, were, generally, 
 partial and mutilated; in this, if the publications are to be relied on, the argu- 
 ments were all on one side of the question: for there is not in the record, 
 which is said to contain the Pennsylvania debates, a word against the ratifi- 
 cation of the constitution; although we all know that arguments were warmly 
 urged on both sides. The gentleman has quoted the opinions as recorded in 
 the debates of this State and North Carolina of two of our learned judges. 
 But the speech of one member is not to be considered as expressing the sense 
 of a convention; and, if it was, we have no record, which can be depended on, 
 of such speeches. Indeed, had even this been the case, the Union was, at that 
 time, divided into two great parties, one of which feared the loss of the Union 
 if the constitutipn was not ratified unconditionally, arid the other, the loss of 
 our liberties, if it was. The object, on either side, was so important, as, per- 
 haps, to induce the parties to depart from candor, and to call in the aid of 
 art, flattery, professions of friendship; promises of office, and even of good 
 cheer, were recurred to; and when these failed, the federal bull was published, 
 denouncing political death and destruction to anti- federal infidel*. Under 
 such circumstances, the opinions of great men ought not to be considered as 
 authorities, and, in many instances, could not be recognised by themselves. 
 
 Mr. Gerry then observing that the sense of the States, respecting a bank, 
 would be best ascertained by their legislative acts, showed, from the journals 
 of Congress, that, when restrained by the confederation from exercising any 
 powers but what were expressly delegated, Congress had, without any au- 
 thority, established a bank, whose capital might extend to ten millions of 
 dollars, and had not only pledged the faith of the Union not to erect any 
 other, but had recommended it to the States to prohibit any State establish- 
 ment of the kind, and had, also, determined that the bank bills should be 
 receivable in the taxes and duties of every State. That the States did not 
 remonstrate against, k or tacitly acquiesce in, but actually supported the mea- 
 sures of Congress relative to the bank, whilst the war continued, and after the 
 peace. That this was the strongest evidence the States could give, that they 
 thought the measure salutary, and had no objection to it on the ground of its 
 being constitutional. He then argued that, if the States, and the People at 
 large, had no objections to a bank, in that case, they certainly could not in 
 this; and inquired whether there was any evidence ot their disapprobation of 
 such an institution in the debates of their conventions or propositions for 
 amendments? To this he answered in the negative, and urged that, whilst 
 the conventions were silent on this subject, and had no objections to such a 
 measure, several of them had proposed amendments to the constitution, for 
 restraining Congress from establishing commercial corporations, which evinc- 
 ed their approbation of such institutions, and admitted, at the same time, in 
 some degree, the power of Congress, under the existing constitution, to form 
 them. 
 
 Mr. Gerry then showed that, as a monopoly has been urged as an objection 
 to the bill, no such consequence could result from it: for the bill does not 
 restrain State or private banks, or even individuals, from negotiations of a 
 similar nature with those permitted to the stockholders; nor does it restrain 
 the States from forming similar corporations. This plan has not a feature of 
 monopoly, and the gentlemen who oppose it contend for a bank, which, ac- 
 cording to its original institution, was founded in monopoly. 
 
 He then answered the arguments, urged against the authority of Congress, 
 to enable corporations to hold lands, when they had no power themselves 01 
 purchasing and holding land ; and showed that, although Congress are restrain- 
 e(J from purchasing lands, (except in certain cases) and from exercising over 
 
CHARTER OF 1791. 81 
 
 the same exclusive legislation; yet, that they may hold lands obtained by 
 execution, conquest, and by other means, as well as by those clauses of the 
 constitution which relate to lands now belonging to the Union; and that 
 Congress had often invested others with powers which they, themselves, could 
 not exercise. 
 
 He then noticed the argument, that, by a law of Virginia, notes payable to 
 the bearer, or order, could not circulate in that State; and observed that this 
 law could not be supposed to extend to bank notes; and, if it did, it W9uld be 
 null and void, because the constitution of the Union, and laws made in pur- 
 suance thereof, were paramount to the laws and constitutions of the several | 
 States. Having considered the arguments against the constitutionality of the 1 
 bill, he entered into the policy and utility of the measure, in his remarks on I 
 which head, the reporter did not follow him. 
 
 Mr. VINIXG apologized for rising to offer his sentiments on this subject, 
 which had already been so ably discussed; but, considering the nature 01 the 
 objections, as arising from constitutional principles, it had acquired air impor- 
 tance which would justify his troubling the House with some remarks. 
 
 He began by noticing the leading argument of Mr. Madison respecting the 
 sense of the continental convention, on the power proposed to be exercised by 
 Congress in this bill. He showed that the opinion of the gentleman, in tins 
 instance, was, if not singular, different from that of his contemporaries; at 
 least, a similar objection had not been started by those gentlemen of the Se- 
 nate who had been members of the convention; but, granting that the opinion 
 of the gentleman from Virginia had been the full sense of the members of 
 convention, their opinions, at that day, he observed, are not a sufficient autho- 
 rity for Congress, at the present time, to construe the constitution by. 
 
 Mr. V., in explaining the powers proposed by the bill to be given to the 
 corporation of the bank, adverted to the particular power of " making rules 
 and regulations not contrary to law." 
 
 He snowed that this term law means the common law, and, alluding to the 
 inquiry of Mr. Madison, what law was intended by this clause? who, in an- 
 swering his own question, had said, that, if the laws of the United States were 
 intended, the power contemplated was dangerous and unconstitutional, as 
 those lawsyuere very few in number, Mr. VININO observed, that the restric- 
 tion contended for by the gentleman, as the result of his objection, would 
 annihilate the most essential rights and privileges of the citizens of the Unit- 
 ed States. He then observed, a corporation is nothing more than constituting 
 a b9dy with posvers to effect certain objects in a combined capacity, which 
 an individual may do in his individual capacity, agreeably to the usage and 
 custom of common law. 
 
 Adverting to the act by which the United States became a free and inde- 
 pendent nation, he said, from that declaration, solemnly recognised at home 
 and abroad, they derive all the powers appertaining to a nation thus circum- 
 stanced, and consequently the power under consideration. He traced the 
 origin of corporations to the time ofNuraa; the first of which was for agricul- 
 tural purposes; they were afterwards extended to other objects; and, from 
 that day to this, said he, all civilized and independent nations have been in 
 the practice of creating them; and what do they amount to but this, enabling 
 a number of persons, in a combined capacity, to do that to a more certain 
 effect than an individual may do t but subject to the control of common law 
 i; ill its regulations and transactions. 
 
 On the doctrine of constructions, as applied to the constitution, he observed, 
 that, on some occasions, the constitution is like the sensitive plant, which 
 shrinks from the smallest touch; on others, it is like the sturdy oak, which 
 braves the force of thunder. He referred to the act containing the power of 
 removability, in which the utmost latitude of construing the constitution 
 was contended for and adopted; and, said he, the funding system cannot be 
 defended on any other principle than that of implication. 
 11 
 
82 BANK OF THE UNITED STATES. 
 
 He then inquired, of what right does this incorporation deprive a single citi- 
 zen? And can an act possibly meet the disapprobation of a single person 
 which does not infringe his rights, and which puts money into his pocket? I 
 think not. He insisted that the power of Congress alone, was equal to esta- 
 blishing a bank, competent of creating a currency which shall pervade all parts 
 of the Union; the paper of the State banks cannot circulate beyond the bounds 
 of the particular States. 
 
 From the restrictions to the Government, contended for by the opposers of 
 the bill, he similized the constitution to a horse, finely proportioned in every 
 respect to the eye, and elegantly caparisoned, but deficient in one, and the 
 most essential requisite, that of ability to carry the owner to his journey's 
 end; he had rather, he said, mount the old confederation, and drag on in the 
 old way, than be amused with the appearance of a Government so essentially 
 defective. 
 
 Mr. MADISON observed, that the present is a question which ought to be 
 conducted with moderation and candor, and, therefore, there is no occasion to- 
 have recourse to those tragic representations which have been adduced 
 warmth and passion should be excluded from the discussion of a subject 
 which ought to depend on the cool dictates of reason for its decision. 
 
 Adverting to me observations of Mr. Smith, of South Carolina, 6 fc that it 
 would be a deplorable thing for the Senate of the United States to have 
 fallen on a decision which violates the constitution," he inquired, what does 
 the reasoning of the gentleman tend to show, but this, that, from respect to the 
 Senate, this House ought to sanction their decision? And from hence it will 
 follow, that the President of the United States ought, out of respect to both,, 
 to sanction their joint proceedings; but he could, he said, remind the gentle- 
 man of his holding different sentiments on another occasion. 
 
 Mr. M. then enlarged on the exact balance of equipoise, contemplat- 
 ed by the constitution, to be observed and maintained between the several 
 branches of Government; and showed that, except this idea was preserved, the 
 advantages of different independent branches would be lost, and their separate 
 deliberations and determinations were entirely useless. 
 
 In describing a corporation, he observed, that the powers proposed to be 
 given, are such as do not exist antecedent to the existence of the corporation; 
 these powers are very extensive in their nature, and to which a principle of 
 perpetuity may be annexed, 
 
 He waived a reply to Mr. Vining's observations on the common law, (m 
 which that gentleman had been lengthy and minute, in order to invalidate 
 Mr. Madison's objection to the power proposed to be given to the bank, to 
 make rules and regulations* not contrary to law.) Mr. Madison said the ques- 
 tion would involve a very lengthy discussion; and other objects, more inti- 
 mately connected with the subject, remained to be considered. 
 
 The power of granting charters, he observed, is a great and important power, 
 and ought not to be exercised without we find ourselves expressly authorized 
 to grant them. Here he dilated on the great and extensive influence that 
 incorporated societies had on public affairs in Europe. They are a powerful 
 machine, which have always been found competent to effect objects on princi- 
 ples in a great measure independent of the People. 
 
 He argued against the influence of the precedent to be established by the 
 bill; for, though it has been said that the charter is to be granted only for a 
 term of years, yet, he contended that granting the powers, on any principle, is 
 granting them inperpetuum and assuming this right on the part ot the Go- 
 vernment, involves the assumption of every power whatever. 
 
 Noticing the arguments in favor of the bill, he said, it had been observed 
 that the "Government necessarily possesses every power." However tree this 
 idea may be in theory, he denied that it applied to the Government of the 
 
 Here he read the restrictive clause in the constitution, and then observed 
 that he saw no pass over this limit. 
 
CHARTER OF 1791. 33 
 
 The preamble to the constitution, said he, has produced a new mine ot 
 power; but this is the first instance he had heard of, in which the preamble has 
 been adduced, for such a purpose. In his opinion, the preamble only states 
 the objects of the confederation; and the subsequent clauses designate the ex- 
 press powers by which those objects are to be obtained; and a mean is pro- 
 posed through which to acquire those that may be found still requisite, more 
 Fully to effect the purposes of the confederation. 
 
 It is said, " there is a field of legislation yet unexplored." He had often 
 heard this language, but, he confessed, he tlid not understand it Is there, 
 said he, a single blade of grass is there any property in existence in the 
 United States, which is not subject to legislation, either of the particular 
 States or of the United States? He contended that the exercise of this power, 
 on the part of the United States,. involves, to all intents and purposes, every 
 power which an individual State may exercise. On this principle, he denied 
 the right of Congress to make use of a bank to facilitate the collection of taxes. 
 He did not, however, admit the idea, that the institution would conduce to 
 that object. The bank notes are to be equal to gold and silver, and conse- 
 quently will be as difficult to obtain as the specie. By means of the objects 
 of trade on which gold and silver are employed, there will be an influx of 
 those articles; but paper being substituted, will fill those channels, which 
 would otherwise be occupied by the precious metals. This, experience shows, 
 is the uniform effect of such a substitution. 
 
 The right of Congress to regulate trade, is adduced as an argument in favor 
 of this of creating a corporation; but what has this bill to do with trade? 
 Would any plain man suppose that this bill had any thing to do with trade? 
 He noticed the observation respecting the utility of banks to aid the Govern- 
 ment with loans. He denied the necessity of the institution to aid the Go- 
 vernment in this respect. Great Britain, he observed, did not depend on such 
 institutionsshe borrows from various sources. 
 
 44 Banks, it is said, are necessary to pay the interest of the public debt;" 
 then they ought to be established in the places where that interest is paid; but 
 can any man say, that the bank notes will circulate at par in Georgia? From 
 the example of Scotland, we know that they cannot be made equal to specie 
 remote from the place where they can be immediately C9n verted into coin: 
 they must depreciate in case of a demand for specie; and if there is no moral 
 certainty that the interest can be paid by these bank bills, will the Govern- 
 ment be justified in depriving itself of the power of establishing banks in dif- 
 ferent parts of the Union? 
 
 We reason, said he, and often with advantage, from British models; but in 
 the present instance, there is a great dissimilarity of circumstances. The 
 bank notes of Great Britain do not circulate universally; to make the circum- 
 stances parallel, it ought to have been assumed, as a fact, that banks are es- 
 tablished in various parts of Great Britain, at which the interest of the national 
 debt is paid; but the fact is, it is only paid in one place. 
 
 The clause of the constitution, which has been so often recurred to. and 
 which empowers Congress to dispose of its property, he supposed, referred 
 only to property left at the conclusion of the war, and has no reference to the 
 moneyed property of the United States. 
 
 The clause which empowers Congress to pass all laws necessary, &c. has 
 been brought forward repeatedly by the advocates of the bill; he noticed the 
 several constructions of this clause which had been offered. The conclusion 
 which he drew from the commentary of the gentleman from Massachusetts, 
 [Mr. GERRY] was, that Congress may do what they please; and recurring to 
 the opinion of that gentleman, in 1787, he said, the powers of the constitution 
 were then dark, inexplicable, and dangerous; but now, perhaps, as the result 
 ot experience, they are clear and luminous. 
 
 The constructions of the constitution, he asserted, which have been main- 
 tained on this occasion, go to the subversion of every power whatever in the 
 several States; but we are told, for our comfort, that the judges will rectify our 
 
84 BANK OF THE UNITED STATES. 
 
 mistakes. How are the judges to determine in the case? Are they to be guided 
 in their decisions by the rules of expediency? 
 
 It has been asked, if those minute powers of the constitution were 
 thought to be necessary, is it supposable that the great and important power 
 on the table was not intended to be given? Mr. Madison interpreted this cir- 
 cumstance in a quite different way, viz: If it was thought necessary to spe- 
 cify, in the constitution, those minute powers, it would follow that more im- 
 portant powers would have been explicitly granted, had they been contem- 
 plated. 
 
 The Western territory business^ he observed, was a ease sui generis, and 
 therefore cannot be cited with propriety. West Point, so often mentioned, he 
 said, was purchased by the United States pursuant to law, and the consent of 
 the State of New York is supposed, if it has not been expressly granted; but, on 
 any occasion, does it follow that one violation of the constitution is to be justi- 
 fied by another? 
 
 The permanent residence bill, he conceived,, was entirely irrevalent to the 
 subject; but he conceived it mignt be justified on truly constitutional princi- 
 ples. The act vesting in the President of the United States the power of re- 
 movability has been quoted; he recapitulated, in a few words, his reasons for 
 being in favor of that bil 1 . 
 
 The Bank of North America, he said, he had opposed, as he considered the 
 institution as a violation of the confederation. The State of Massachusetts, 
 he recollected, voted with him on that occasion. The Bank of North America 
 was, however, the child of necessity; as soon as the war was over, it ceased to 
 operate as to continental purposes. But, asked he, are precedents in war to 
 justify violations of private and State rights, in a time of peace? And did the 
 United States pass laws to punish the counterfeiting the notes of that bank? 
 They did not, being convinced of the invalidity of such a law; the bank there- 
 fore took shelter under the authority of the State. 
 
 The energetic administration of this Government is said to be connected 
 with this institution. Mr. Madison here stated the principles on which he 
 conceived this Government ought to be administered, and added, other gen- 
 tlemen may have had other ideas on the subject, and may have consented to 
 the ratification of the constitution, on different principles and expectations; 
 but he considered the enlightened opinion and affections of the People, the 
 only solid basis for the support of this Government. 
 
 Mr. Madison then stated his objections to the several parts of the bill. The 
 first article he objected to, was the duration. A period of twenty years, he 
 observed, was, to this country, as a period of a century in the history of other 
 countries there was no calculating for the events which might take place. 
 He urged the ill policy of granting so long a term, from the experience of the 
 Government in respect to some treaties, which, though found inconvenient, 
 could not now be altered. 
 
 The different classes of the public creditors, he observed, were not all put 
 on an equal footing by this bill; but, in the bill for the disposal of the Western 
 territory, this had been thought essential. The holders of six per cent, securi- 
 ties will derive undue advantages. Creditors at a distance, and the holders of 
 three per cent, securities, ought to be considered; as the public good is most 
 essentially promoted by an equal attention to the interest ot all. 
 
 I admit, said he ? that the Government ought to consider itself as the trustee 
 of the public on this occasion; and, therefore, should avail itself of the best dis- 
 position of the public property. 
 
 In this view of the subject, he objected to the bill, as the public, he thought, 
 ought to derive greater advantages from the institution than those proposed. 
 In case of a universal circulation of the notes of the proposed bank, the profits 
 will be so great, that the Government ought to receive a very considerable 
 sum for granting the charter. 
 
 There are other defects in the bill, which render it proper and necessary, in 
 my opinion, that it should undergo a revision and amendment before it passes 
 into a law. The power vested by the bill in the Executive, to borrow of the 
 
CHARTER OF 1791. 35 
 
 bank, he thought was objectionable; and the right to establish subordinate 
 banks, he said, ought not to be delegated to any set of men under heaven. 
 
 The public opinion has been mentioned; if the appeal to the public opinion 
 is suggested with sincerity, we ought to let our constituents have an opportu- 
 nity to form an opinion pi the subject. 
 
 He concluded by saying, he should move for the previous question. 
 
 Mr. GERRY rose to reply to Mr. Madison; but the House discovering an 
 impatience to have the mam question put, after a few remarks, he waived any 
 further observations. 
 
 FEBRUARY 8, 179Jf. 
 
 Mr. MADISON having, in the conclusion of his speech, moved the previous 
 question, to wit: " Shall the main question noiv be put?" it was resolved in 
 the affirmative by a vote of 38 to 20. 
 
 And the main question being put, to wit: " Shall the bill pass?" it was re- 
 solved in the affirmative. Ayes 39, noes 20. 
 
 Those who voted in the affirmative, are, 
 
 Messrs. Fisher Ames, of Mass. Messrs. George Partridge, Mass. 
 
 Egbert Benson, N. Y. Jeremiah Van Rensselaer, N. Y. 
 
 Elias Boudinot, N. J. James Schureman, N. J. 
 
 Benjamin Bourn, R. /. Thomas Scott, Pa. 
 
 Lambert Cadwallader, N. J. Theodore Sedgwick, Mats. 
 
 George Clymer, Pa. Joshua Seney, Md. 
 
 Thomas Fitzsimmons, Pa. John Sevier, N. C. 
 
 William Floyd, N. Y. Roger Sherman, Conn. 
 
 Abiel Foster, N. H f Peter Sylvester, N. Y. 
 
 Elbridge Gerry, Mass. Thomas Sinnickson, N. J. 
 
 Nicholas Gilman, N. H. William Smith, Md. 
 
 Benjamin Goodhue, Most. William Smith, S. C. 
 
 Thomas Hartley, Pa. John Steele, N. C. 
 
 John Hathorn, If. Y. Jonathan Sturges, Conn. 
 
 Daniel Heister, Pa. George Thatcher, Mass. 
 
 Benjamin Huntington, Conn. Jonathan Trumbull, Conn. 
 
 John Lawrence, N. Y. John Vining, Del. 
 
 George Leonard, Mass. Jeremiah Wadsworth, Conn. 
 
 Samuel Livermore, N. H. Henry Wyncoop, Pa. 
 
 Peter Muhlenburg, Pa. 
 
 Those who voted in the negative, are, 
 
 Messrs. John Baptist Ashe, N. C. Messrs. Richard Bland Lee, Va. 
 
 Abraham Baldwin, Geo. James Madison, Jun. Fa. 
 
 Timothy Bloodgood, Nt C. George Matthews, Geo. 
 
 John Brown, Va. Andrew Moore, Va. 
 
 Edanus Burke, S. C: Josiah Parker, Vu. 
 
 Daniel Carroll, Md. s Michael Jenifer Stone, Md} 
 
 Benjamin Contee, Md. Thomas Tudor Tucker, S. C. 
 
 Jonathan Grout, Mass.'' Alexander White, Va. 
 
 N - William B. Giles, Va. Hugh Williamson, N. C- 
 James Jackson, Geo. 
 
 So the bill was passed, and it was 
 
 Ordered, That the Clerk of the House do acquaint the Senate therewith. 
 
 On the 14th of February, 1791, the bill was presented to the President for 
 his approbation; on the 25th, it received his signature, and became a law. The 
 interval between these two dates was occupied by him in anxious and dili- 
 gent inquiries into the constitutionality of the bill, and in the consideration 
 of his duty in relation to it. In these investigations, he called to his aid his 
 cabinet advisers, and received from some of them their written opinions on 
 the subject. These have been obtained, and are here inserted, as well on ac- 
 count of their own intrinsic importance, as of the illustration they afford of 
 
35 BANK OF THE UNITED STATES. 
 
 the caution and circumspection in the discharge of official duties of the truly 
 great man to whom they were addressed. 
 
 The opinions ot Edmund Randolph, Attorney General, and of Mr. Jeffer- 
 son, Secretary of State, were, that tne bill was unconstitutional, while that of 
 Alexander Hamilton, Secretary of the Treasury, was given on the opposite 
 side, and in support of the bill. 
 
 OPINION OF EDMUND RANDOLPH, 
 
 
 
 Attorney General of the United States, to President Washington. 
 
 The Attorney General of the United States, in obedience to the order of 
 the President of the United States, has had under consideration the bill, en- 
 titled " An act to incorporate the subscribers to the Bank of the United 
 States," and reports on it, in point of constitutionality, as follows: 
 \i It must be acknowledged, that, if any part of the bill does either encounter 
 the constitution, or is not warranted by it, the clause of incorporation is the 
 only one. 
 
 The legal properties of this corporation would be, 
 
 1st. To have succession until the 4th ot March, 1811; 
 
 2d. To purchase, receive, and retain, real and personal property, to an 
 amount not exceeding fifteen millions of dollars, including the capital stock; 
 
 3d. To sell and dispose of the property; 
 
 4th. To sue, and be sued; 
 
 5th. To have a common seal; and 
 
 6th. To make by-laws, and do all acts appertaining to the corporation, un- 
 der certain restrictions prescribed in the act. 
 
 These properties, with different modifications in some instances, belong to 
 all corporations. Their importance strikes the eye. 
 
 That the power of creating corporations is not expressly given to Congress, 
 is obvious. 
 
 If it can be exercised by them, it must be, 
 
 1st. Because the nature of the Federal Government implies it; or, 
 
 2d. Because it is involved in some of the specified powers of legislation; or, 
 
 3d. Because it is necessary and proper to carry into execution some of the 
 specified powers: 
 
 1st. To be implied in the nature of the Federal Government, would beget 
 a doctrine so indefinite as to grasp every power. 
 
 Governments having no written constitution may, perhaps, claim a lati- 
 tude of power not always easy to be determined. Those which have written 
 constitutions are circumscribed by a just interpretation of the words contain- 
 ed in them. Nay, farther; a legislature, instituted even by a written consti- 
 tution, but without a special demarcation of powers., may, perhaps, be pre- 
 sumed to be left at large, as to all authority which is communicable by the 
 people, and does not affect any of those paramount rights, which a free people 
 cannot be supposed to confide even to their representatives. Essentially 
 otherwise is the condition of a legislature whose powers are described. An 
 example of the former, is in the State Legislatures; of the latter, in the Legis- 
 lature of the Federal Government, the characteristic of which has been con- 
 fessed by Congress, in the twelfth amendment, to be, that it claims no pow- 
 ers which are not delegated to it. 
 
 This last observation straitens the federal powers, and opposes an opin- 
 ion, not unpatrpnised, that Congress may exercise all authority to which the 
 States are individually incompetent. 
 
 If any subject of government, from which the States are not excluded by 
 the constitution, be beyond their jurisdiction within their own limits, let it be 
 shown: it cannot be easily conceived. 
 
 But what if a subject should really exist? Is the argument less conclusive 
 to say, that the States must retain it, because it is not given to the Federal 
 
CHARTER OF 1791. 87 
 
 Government, than that the latter, although limited in itself, possesses it, be- 
 cause it is not within the verge of a State constitution? While, on the other 
 hand, it ought not to be denied that the Federal Government superintendsthe 
 general welfare of the States, it ought not to be forgotten, on the other, that 
 it superintends it according to the dictates of the constitution. 
 
 The opinion above alluded to can have only one other object, namely, that 
 every institution to which a single State can give efficacy only within its own 
 boundaries, devolves on Congress. But the extravagance of such a position, is 
 manifested by a single circumstance, that the cutting of canals through two 
 or more States, at the will of Congress, is one of its least consequences. 
 
 2d. We ask, then, in the second place, whether, upon any principle of fair 
 construction, the specified powers of legislation involve the power of grant- 
 ing charters of incorporation: 1 We say charters of incorporation, without con- 
 fining the question to the bank; because the admission of it in that instance, 
 is an admission of it in every other, in which Congress may think the useof it 
 equally expedient. 
 
 There is a real difference between the rule of interpretation, applied to a 
 law and a constitution. The one comprises a summary of matter, for the 
 detail of which numberless laws will be necessary; the other is the very de- 
 tail. The one is, therefore, to be construed with a discreet liberality, the 
 other, with a closer adherence to the literal meaning. 
 
 But, when we compare the modes of construing a State and the Federal 
 constitution, we are admonished to be stricter with regard to the latter, be- 
 cause there is a greater danger of error in defining partial, than general 
 powers. 
 
 The rule, therefore, for interpreting the specified powers, seems to be, that, 
 as each of them includes those details, winch properly constitute the whole 
 of the subject to which the power relates, the details themselves must be 
 fixed by reasoning. And the appeal may, on this occasion, be made to com- 
 mon sense and common language. 
 
 Those powers, then, ^vhich bear any analogy to that of incorporation, shall 
 be examined separately in their constituent parts: and afterwards, in those 
 traits which are urged to have the strongest resemblance to the favorite power. 
 
 First. Congress have power to lay and collect taxes, &c. The heads of this 
 power are, 
 
 1st. To ascertain the subjects of taxation, &c. 
 
 2d. To declare the quantum of taxation, &c. 
 
 3d. To prescribe the mode of collection; and 
 
 4th. To ordain the manner of accounting for the taxes, &c. 
 
 Second. Congress have also power to borrow money on the credit of the 
 United States. 
 
 The heads of this power, are, 
 
 1st. To stipulate a sum to be lent; 
 
 2d. To stipulate an interest, or no interest, to be paid; and 
 
 3d. To stipulate the time and manner of repayment, unless the loan be 
 placed on an irredeemable fund. 
 
 Third. Congress have also power to regulate commerce with foreign nations, 
 among the several States, and with the Indian tribes. 
 
 The heads of this power, with respect to foreign nations, are, 
 
 1st. To prohibit them or their commodities from our ports; 
 
 2d. To impose duties on them, where none existed before, or to increase 
 existing duties on them; 
 
 3d. To subject them to any species of custom house regulations; or, 
 
 4th. To grant them any exemptions or privileges which policy may suggest. 
 
 The heads of this power, with respect to the several States, are little more 
 than to establish the forms of commercial intercourse between them, and to 
 keep the prohibitions which the constitution imposes on that intercourse, un- 
 diminished in their operation; that is, to prevent taxes on imports or exports; 
 preferences to one port over another, by any regulation of commerce or reve- 
 
88 BANK OF THE UNITED STATES. 
 
 nue; and duties upon the entering or clearing of the vessels of one State in 
 the ports of another. 
 
 The heads of this power, with respect to Indian tribes, are, 
 
 1st. To prohibit the Indians from coming into, or trading within, the United 
 States; 
 
 2d. To admit them with, or without, restrictions; 
 
 3d. To prohibit citizens of the United States from trading with them; or, 
 
 4th. To permit with, or without, restrictions, 
 
 Fourth. Congress have also power to dispose of, and make all needful rules 
 and regulations respecting, the territory, or other property belonging to the 
 United States. 
 
 The heads of this power, are, 
 
 1st. To exert an ownership over the territory of the United States, which 
 may be properly called the property of the United States, as is the Western 
 territory, and to institute a Government therein; or, 
 
 2d. To exert an ownership over the other property of the United States. 
 
 This property may signify, 
 
 1st. rersonal property of the United States, howsoever acquired; or, 
 
 2d. Real property, not aptly denominated territory, acquired by cession or 
 otherwise. 
 
 It cannot signify, 
 
 1st. Debts due from the United States; 
 
 2d. Nor money arising from the sources of revenue pointed out in the con- 
 stitution. The disposal and regulation of money, is the final cause for raising 
 it by taxes, &c. 
 
 Fifth. The preamble to the constitution has also been relied on as a source 
 of power. 
 
 To this, it will be here remarked, once for all, that the preamble, if it be 
 operative, is a full constitution of itself, and the body of the constitution is 
 useless; but that it is declarative only 01 the views of the convention, which 
 they supposed would be best fulfilled by the powers delineated; and that such 
 is the legitimate nature of preambles. 
 
 With this analysis of the foregoing specified powers, compare each of the 
 corporate powers, and where is the similitude? It lies, say the advocates of 
 the bill, in the power to lay and collect taxes, &c.; because it facilitates the 
 payment of them: in that of borrowing money, because it creates an ability to 
 lend; in that of regulating commerce, because it increases the medium of cir- 
 culation, and thus encourages activity and industry. In that of disposing and 
 regulating property, because the contributions and the interest of the United 
 States in the bank, are property of the United States. Of each of these rea- 
 sons, something will be said in their order. 
 
 The incorporation of a bank can facilitate the payment of taxes, only by 
 creating a faculty to pay, or by supplying a deficient medium, or by rendering 
 the transportation of money to the seat of government more convenient. But, 
 to lay and collect taxes, is, in fact, to demand and receive a public debt* 
 resting the mode of procuring the money on the resources of the debtors; and, 
 as to its transportation, surely there are many other vehicles besides bank 
 bills. 
 
 To borrow money, presupposes the accumulation of a fund to be lent; and 
 is secondary to the creation of an ability to lend. 
 
 By regulating commerce, in order to increase the medium of circulation, 
 cannot be intended any of the commercial powers designated above; these 
 being very remote from the incorporation of a bank. Nor can it be imagined, 
 that it is intended to reach the emission of paper money. What construction 
 remains, by which to regulate commerce, can increase the medium? Only the 
 emission of coin, which is licensed in terms by another clause. 
 
 To dispose of, or to regulate, property, even bank stock itself, is utterly 
 distinct from the incorporation of a bank: for the contributions on which the 
 bank stock arises, go upon the principle, that a bank already exists; how else 
 can contributions be made to itr 
 
CHARTER OF 1791. gg 
 
 But, in truth, the serious alarm is in the concentered force of these senti- 
 ments. If the laying and collecting of taxes brings with it every thing which, 
 in the opinion of Congress, may facilitate the payment of taxes; if to borrow 
 money sets political speculation loose, to conceive what may create an ability 
 to lends if to regulate commerce is to range in the boundless mazes of pro- 
 jects for the apparently best scheme to invite from abroad, or to diffuse at 
 home, the precious metals; if to dispose of, or to regulate, property of the 
 United States, is to incorporate a bank, that stock may be subscribed to it by 
 them, it may, without exaggeration, be affirmed, that a similar construction on 
 every specified federal power, will stretch the arm of Congress into the whole 
 circle of State legislation. 
 
 The general qualities of the Federal Government, independent of the con- 
 stitution and the specified powers, being thus insufficient to uphold the incor- 
 poration of a bank, we come to the last inquiry, which has been already anti- 
 cipated, whether it be sanctified by the power to make all laws, which snail be 
 necessary and proper for carrying into execution the powers vested by the 
 constitution. To be necessary is to be incidental, or, in other words, may be 
 denominated the natural means of executing a power. 
 
 The phrase "and proper," if it has any meaaing, does not enlarge the powers 
 of Congress, but rather restricts them. For no power is to be assumed under 
 the general clause, but such as is not only necessary, but proper, or perhaps 
 expedient also. But as the friends to the bill ought not to claim any advantage 
 from this clause, so ought not the enemies to it, to quote the clause as having 
 a restrictive effect. Both ought to consider it as among the surplusage which as 
 often proceeds from inattention as caution. 
 
 However, let it be propounded as an eternal question to those who build new 
 powers on this clause, whether the latitude of construction, which they arrogate 
 will not terminate in an unlimited power in Congress. 
 
 In every respect, therefore, tinder which the Attorney General can yiew 
 the act, so far as it incorporates the bank, he is bound to declare his opinion 
 to be against its constitutionality. 
 
 EDMUND RANDOLPH. 
 
 February 12M, 1791, 
 
 ATTORNEY GENERAL'S OPINION- 
 
 No. 2. 
 
 The Attorney General holding it to be his duty to address to the President 
 of the United States, as the grounds of an official opinion, no arguments, the 
 truth of which he does not acknowledge, has reserved for this purpose several 
 topics, which have more or less influenced the friends and enemies of the bank 
 bill; and which ought, therefore, to be communicated to the President. 
 
 1st. The enemies of Jhe bill have contended that a rule of construction, 
 adverse to the power of incorporation, springs out of the constitution itself; 
 that, after the grant of certain powers to Congress, the constitution, as if cau- 
 tious against usurpation, specially grants several other powers, more akin to 
 those before given, than the incorporation of a bank is to any of those from 
 which it is deduced. This position, they say, has been exemplified in four 
 instances: 
 
 1 . A power is given to regulate commerce; and yet is added a power to es- 
 tablish uniform laws on the subject of bankruptcies throughout the United 
 States; to fix the standard of weights and measures; and to establish post 
 offices and post roads. 
 
 2. A power is given to coin money; and yet is added a power to regulate 
 the value thereof, and of foreign coin; and to provide for the punishment of 
 counterfeiting the current coin of the United States. 
 
 3. A power is given to declare war; and yet is added a power to grant let- 
 ters of marque and reprisal; to make rules concerning captures on land and 
 
 12 
 
90 BANK OF THE UNITED STATES. 
 
 water ; to raise and support armies; to provide and maintain a navy; audio 
 make rules for the government and regulation of the land and naval forces. 
 
 4. A power is given to provide for calling forth the militia, to execute the 
 laws of the Union; and yet is added a power to call them forth to suppress 
 insurrections. 
 
 Whosoever will attentively inspect the constitution will readily preceive 
 the force of what is expressed in the letter of the convention, "That the con- 
 stitution was the result of a spirit of amity and mutual deference and conces- 
 sion." To argue, then, from its style or arrangement, as being logically exact, 
 is, perhaps, a scheme of reasoning not absolutely precise. 
 
 But, if the constitution were ever so perfect, considered even as a composi- 
 tion, the difficulties which the abave doctrine has stated maybe solved by the 
 following remarks: 
 
 These similar powers, on which stress is laid, are either incidental, or sub- 
 stantive, that is, independent powers. 
 
 If they be incidental powers, and the conclusion be, that, because some in- 
 cidental powers are expressed, no others are admissible- it would not only be 
 contrary to the common forms of construction, but would reduce the present 
 Congress to the feebleness of the old one, which could exercise no powers not 
 expressly delegated. So that the advocates for the power of incorporation, on 
 the principle oi incidentally to some specified power, would, notwithstanding 
 this supposed rule of interpretation, be as much at liberty to insist on its being 
 an incidental power as ever. 
 
 If these similar powers be substantive and independent, (as on many occa- 
 sions they are, that is, as they can be conceived to be capable of being used, 
 independently of what is called the principal power,) it ought not to be inferred 
 that they were inserted for any other purpose, than to bestow an independent 
 power, where it would not otherwise have existed. 
 
 The only remaining signifi cation, which the doctrine now controverted can 
 have, is, that the incorporation of a bank,, being more wide from a connexion 
 with the specified powers of legislation than the additional ones were from 
 the principal powers,, to which they were supposed to belong, the power of in- 
 corporation being omitted, or rather not specially mentioned, cannot be assum- 
 ed. Even this answer is not adequate to those, who derive the power of incor- 
 poration from the nature of the Federal Government. 
 
 Hence the rule contended for by the enemies of the bill is defective every 
 way. It would be still more so with respect to those (if any such there be) 
 who construe the words, "necessary and proper " so as to embrace every ex- 
 pedient power. 
 
 2d. An appeal Iras been also made by the enemies of the bill to what passed 
 in the federal convention on the subject. But ought not the constitution to be 
 decided on by the import of its own expressions? What may not be the conse- 
 quence if an almost unknown history should govern the construction? 
 
 3d. The opinions too of several respectable characters have been cited, as de- 
 livered in the state conventions- As these have no authoritative influence, so 
 ought it to be remembered, that observations were uttered by the advocates 
 of the constitution, before its adoption, to which they will not, and, in many 
 cases, ought not to adhere. 
 
 4th. On the other hand ,. the friends to the bill have relied on the congressional 
 actsas to West Point, the government of the Western Territory, and the 
 power of removal from office given to the President- 
 
 The two first are within express powers, as will occur, by adverting to the 
 power to exercise authority over places purchased for forts, &c. and to the 
 power to dispose of, and make needful rules and regulations respecting the 
 property of the United States. The last is a point with a great weight ot rea- 
 son on each side. If it be founded on the general nature of executive authoitv,. 
 the power is probably not tenable, without resorting to the doctrines of the 
 friends to the bill. But it appears to be a power not specifically given to any 
 person, (except on an impeachment,) and may, therefore, incidentally belong 
 to Congress to confer on the President. However, if this step be an error, it 
 is never too late to correct it 
 
CHARTER OF 1791. 91 
 
 5th. It has been also pretended, that even the infirm old Congress incorpo- 
 rated a bank; and can a less power be presumed to be vested in the Federal 
 Government, which has been formed to remedy their weakness? This argu- 
 ment is so indefinite, the time of the incorporation was so pressing, and the 
 States had such an unlimited command over Congress and their acts, that 
 the public acquiescence ought not to be the basis of such a power under the 
 present circumstances. 
 
 fth. Congress, it is further said , may provide for the general welfare, and this 
 includes the power of incorporation: but they are to provide for the general 
 welfare in laying and collecting taxes. Is the incorporation of a bank a tax 
 bill? The meaning of the power, taken together, seems to be, that Congress 
 may lay taxes for the purpose of expending money for the public weKire, even 
 to subscribe it to a bank. But is this like the creation of a bank? It implies 
 that a bank has been already created. 
 
 7th. It has been also asserted, that Congress have an exclusive legislation at 
 the Seat of Government This will not be true, until they go to the place of the 
 permanent residence. 
 
 The Attorney General has not collected any other informatioun pon this sub- 
 ject, although more may, perhaps, have been said by the partisans for and 
 against the bank, than is here noticed. 
 
 EDMUND RANDOLPH. 
 
 February 12//i, 1791. 
 
 OPINION OF THOMAS JEFFERSON, SECRETARY OF STATE, ON THE 
 
 SAME SUBJECT. 
 
 The bill for establishing a national bank undertakes, among other things, 
 
 1. To form the subscribers into a corporation. 
 
 2. To enable them, in their corporate capacities, to receive grants of land; 
 and so far is against the laws of mortmain.* 
 
 3. To make alien subscribers capable of holding lands; and so far is 
 against the laws of alienage. 
 
 4. To transmit these lands, on the death of a proprietor, to a certain line 
 of successors; and so far changes the course of descents. 
 
 5. To put the lands out of the reach of forfeiture or escheat; and so far is 
 against the laws of forfeiture and escheat. 
 
 6. To transmit personal chattels to successors, in a certain line; and so far 
 is against the laws of distribution. 
 
 7. To give them the sole and exclusive right of banking under the national 
 authority; and so far is against the laws of monopoly. 
 
 8. To communicate to them a power to make laws paramount to the laws 
 of the States; for so they must be construed, to protect the institution from 
 the control of the State Legislatures; and so, probably? they will be con- 
 strued. 
 
 I consider the foundation of the constitution as laid on this ground, that, 
 " ail powers not delegated to the United States by the constitution, nor 
 prohibited bv it to the States, are reserved to the States, or to the people." /> 
 
 (12th amendment.) To take a single step beyond the boundaries thus 
 specially drawn around the powers of Congress, is to take possession of a / 
 
 boundless field of power, no longer susceptible of any definition. 
 
 The incorporation of a bank, and other powers assumed by this bill, have 
 not, in my opinion, been delegated to the United States by the constitution: 
 
 'Though the constitution controls the laws of mortmain, so far as to permit Congress 
 itself to hold lands for certain purposes, yet not so far as to permit them to communi- 
 cate a iimilar right to other corporate bodies. 
 
92 BANK OF THE UNITED STATES. 
 
 I. They are not among the powers specially enumerated; for these are, 
 
 1 . A power to lay tuxes for the purpose of paying the debts of the United 
 State*; but no debt is paid by this bill, nor any tax laid. Were it a bill to 
 raise money, its origination in the Senate would condemn it by the constitution. 
 
 2. " To borrow money." But this bill neither borrows money, nor insure* 
 the borrowing it. The proprietors of the bank will be just as free, as any other 
 money holders, to lend, or not to lend, their money to the public: the operation 
 proposed in the bill, first to lend them two millions, and then borrow them 
 back again, cannot change the nature of the latter act, which will still be a 
 payment^ and not a loan, call it by whatever name you please. 
 
 3. "To regulate commerce with foreign nations, ami among the States, 
 and with the Indian tribes." To erect a bank, and to regulate commerce, 
 are very different acts. He who erects a bank, creates a subject of commerce 
 in its bills; so does he, who makes a bushel of wheat, or digs a dollar out of 
 the mines; yet neither of these persons regulates commerce thereby. To 
 make a thing which may be bought and sold, is not to prescribe regulations for 
 buying and selling. Besides, if this was an exercise of the power of regulating 
 commerce, it would be void, as extending as much to the internal commerce of 
 every State, as to its external; for the power given to Congress by the constitu- 
 tion doesnot extend to the internal regulation of the commerce ot a State, (that 
 is to say, of the commerce between citizen and citizen,) which remains exclu- 
 sively with its own legislature; but to its external commerce only. That is to 
 say, its commerce with another State, or with foreign nations, or with the Indian, 
 tribes: accordingly the bill does not propose this measure as a "regulation of 
 trade," but, as "productive of considerable advantage to trade;" still less are 
 these powers covered by any other of the special enumerations. 
 
 II. Nor are they within either of the general phrases, which are the two 
 following: 
 
 1. "To lay taxes to provide for the general welfare of the United States;'* 
 that is to say, to lay taxes/or the purpose of providing for the general welfare: 
 for the laying of taxes is the p&wer* and the general welfare the purpose for 
 which the power is to be exercised. They are not to lay taxes ad libitum,, 
 for any purpose they please, but only to pay the debts, or provide for the 
 welfare of the Union. In like manner, they are not to do any thing they 
 please to provide for the general welfare, but only to lay taxes for that pur- 
 pose. To consider the latter phrase, not as describing the purpose of the first, 
 but as giving a distinct arid independent power to do any act they please, 
 which might be for the good of the Union, would render all the preceding 
 and subsequent enumerations of power completely useless: it would reduce 
 the whole instrument to a single phrase, that of instituting a Congress with 
 power to do whatever would be for the good of the United States; and, as- 
 they would be the sole judges of the good or evil, it would be also a power to 
 do whatever evil they pleased. It is an established rule of construction* 
 where a phrase \yillbear either of two meanings, to give it that which will 
 allow some meaning to the other parts of the instrument, and not that which 
 would render all the others useless. Certainly no such universal power was 
 meant to be given to them. It was intended to lace them up straitly within 
 the enumerated powers; and those, without which, as means, those powers 
 could not be carried into effect. It is known that the very power now propos- 
 ed as a means* was rejected as an end by the convention which formed the 
 constitution : a proposition was made to them to authorize Congress to open 
 canals, and an amendatory one to empower them to incorporate ; but the 
 whole was rejected, and one of the reasons of rejection urged in the debate 
 was, that then they would have power Jto i erect a bank, which would render 
 the great cities, where there were prejudices or jealousies on this subject, ad- 
 verse to the reception of the constitution. 
 
 2. The second general phrase is, " to make all laws necessary and proper 
 for carrying into execution the enumerated powers." But they can all be 
 carried into execution without a bank. A bank, therefore, is not necessary, 
 and* consequently, not authorised by this phrase. 
 
s 
 
 CHARTER OF 1791. 
 
 It has been much urged, that a bank will give great facility, or convenience, 
 in the collection of taxes. Suppose this were true, yet the constitution allows 
 only the means which are " necessary," not those which are merely con- 
 venient for effecting the enumerated powers. If such a latitude of construc- 
 tion be allowed to this phrase, as to give any non enumerated power, it will 
 go to every one; for there is no one, which ingenuity may not torture into a 
 convenience, in some ivay or other, to some one of so long a list of enumerated 
 powers: it would swallow up all the delegated powers, and reduce the whole 
 to one phrase, as before observed. Therefore it was that the constitution re- 
 strained them to the necessary means; that is to say, to those means, without 
 which the grant of the power would be nugatory. 
 
 But let us examine tnis convenience, and see what it is. The report on the 
 subject (page 3) states the only general convenience to be the preventing the 
 transportation and re-transportation of money between the States and the 
 treasury, (for I pass over the increase of circulating medium, ascribed to it as 
 a merit, and which, according to my ideas of paper money, is clearly a de- 
 merit.) Every State will have to pay a sum of tax money into the treasury; 
 and the treasury will have to pay, in every State, a part of the interest on the 
 public debt, and salaries to the officers of Government resident in that State. 
 In most of the States there will still be a surplus of tax-money to come up to 
 the Seat of Government for the officers residing there. The payment ot in- 
 terest and salary in each State, may be made by treasury orders on the State 
 collector. This will take up the greater part of the money he has collected 
 for his State, and, consequently, prevent the great mass of it from being 
 drawn out of the State. If there be a balance of commerce in favor of that 
 State against the one in which the Government resides, the surplus of taxes 
 will be remitted by the bills of exchange drawn for that commercial balance; 
 and so it must be if there was a bank. But if there be no balance of com- 
 merce, either direct or circuitous, all the banks in the world could not bring 
 up the surplus of taxes, but in the form of money. Treasury orders, then, and 
 bills of exchange, may prevent the displacement of the main mass of the money 
 collected, without the aid of any bank; and where these fail, it cannot be 
 prevented, even with that aid. 
 
 / Perhaps, indeed, bank bills may be a more convenient vehicle than trea- ^ 
 sury orders; but a little difference in the degree of convenience cannot consti- 
 tute the necessity, which the constitution makes the ground for assuming any 
 non enumerated power. / 
 
 Besides, the existing banks will, without a doubt, enter into arrangements 
 for lending their agency; and the more favorably, as there will be a competi- 
 tion among them for it; whereas the bill delivers us up bound to the national 
 bank, who are free to refuse all arrangement, but on their own terms, and , 
 the public not free, on such refusal, to employ any other bank. That of 
 Philadelphia, I believe, now does this business by their post notes, which by 
 an arrangement with the treasury are paid by any State collector to whom 
 they are presented. This expedient alone suffices to prevent the existence of 
 that necessity, which may justify the assumption of a non enumerated power 
 as a means for carrying into effect an enumerated one. The thing may be 
 done, and has been done, and well done, without this assumption: therefore, 
 it does not stand in that degree of necessity, which can honestly justify it. 
 
 It may be said that a bank, whose bills would have currency all over the 
 States, would be more convenient, than one, whose currency i limited to a 
 single State. So it would be still more convenient that there should be a 
 bank, whose bills .should have a currency all over the world; but it does not 
 folio iv, from this superior conveniency, that there exists any where a power 
 to establish such a bank, or that the \yorld may not o on very well without it. 
 / Can it be thought that the constitution intended, that, for a shade or two of 
 convenience, more or less, Congress should be authorized to break down the 
 most ancient and fundamental laws of the several States, such as those against 
 mortmain, the laws of alienage, the rules of descent, the acts of distribution, 
 the laws of escheat and forfeiture, the laws of monopoly? Nothing, but a ne- 
 
94 BANK OF THE UNITED STATES. 
 
 cessity invincible by any other means, can justify such a prostration of laws, 
 which constitute the pillars of our whole system of jurisprudence. Will 
 Congress be too strait-laced to carry the constitution into honest effect, unless 
 they may pass over the foundation laws of the State Governments, for the 
 slightest convenience to theirs?/ 
 
 The negative of the President is the shield provided by the constitution, 
 to protect against the invasions of the Legislature: 1st. The rights of the Ex- 
 ecutive. 2d. Of the Judiciary. 3d. Of the States and State Legislatures. 
 The present is the case of a right remaining exclusively with the States, and 
 is consequently, one of those intended by the constitution to be placed under 
 his protection. 
 
 It must be added, however, that, unless the President's mind, on a view of 
 every thing, which is urged for and against this bill, is tolerably clear that it 
 is unauthorized by the constitution; if the pro and the con hang so even as to 
 balance his judgment, a just respect for the wisdom of the Legislature, would 
 naturally decide the balance in favor of their opinion: it is chiefly for cases, 
 where they are clearly misled by error, ambition, or interest, that the consti- 
 tution has placed a check in the negative of the President. 
 
 t THOMAS JEFFERSON. 
 
 February 15, 1791. 
 
 From President Washington to Alexander Hamilton, Secretary of Hit Treasury. 
 
 PHILADELPHIA, February 16, 1791. 
 
 SIR: "An act to incorporate the subscribers to the Bank of the United 
 States" is now before me for consideration. 
 
 The constitutionality of it is objected to. It, therefore, becomes more par- 
 ticularly my duty to examine the ground on which the objection is built. As 
 a mean of investigation, I have called upon the Attorney General of the United 
 States, in whose Tine it seemed more particularly to be, for his official exami- 
 nation and opinion. His report is, that the constitution does not warrant the 
 act. I then applied to the Secretary of State for his sentiments on this sub- 
 ject. These coincide with the Attorney General's; and the reasons for their 
 opinions having been submitted in writing, I now require, in like manner, 
 yours, on the validity and propriety of the above recited act: and that you 
 may know the points, on which the Secretary of State and the Attorney 
 General dispute the constitutionality of the act, and that I may be fully 
 possessed of the arguments for and against the measure, before I express 
 any opinion of my own, I give you an opportunity of examining and answer- 
 ing the objections contained in the enclosed papers. I require the return of 
 them, when your own sentiments are handed to me, (which I wish may be as 
 soon as is convenient;) and, further, that no copies of them be taken, as it is 
 for my own satisfaction they have been called for. 
 
 G. WASHINGTON. 
 
 To the Secretary of the Treasury. 
 
 MONDAY. 
 
 The Secretary of the Treasury presents his respects to the President of the 
 United States, to request his indulgence for not having yet furnished his rea- 
 sons on a certain point. He has been ever since sedulously engaged in it, but 
 finds it will be impossible to complete before Tuesday evening, or Wednes- 
 day morning early. He is anxious to give the point a thorough examination. 
 
r HARTER OF 1791. 95 
 
 . 
 PHILADELPHIA, 23<f February, 1794. < 
 
 > | 
 
 The Secretary of the Treasury presents his respects to the President, ami 
 sends him the opinion required, which occupied him the greatest part of last 
 night. 
 
 The bill for extending the time of opening subscriptions passed yesterday, 
 unanimously, to an order for engrossing. 
 
 OPINION OF ALEXANDER HAMILTON, ON THE CONSTITUTIONALITY 
 OF A NATIONAL BANK. 
 
 The Secretary of the Treasury having perused, with attention, the papers 
 containing the opinions of the Secretary of State and Attorney General, con- 
 cerning the constitutionality of the bill for establishing a national bank, pro- 
 ceeds, according to the order of the President, to submit the reasons which 
 have induced him to entertain a different opinion. 
 
 It will naturally have been anticipated that, in performing this task, lie 
 would feel uncommon solicitude. Personal considerations alone, arising 
 from the reflection that the measure originated with him, would be sufficient 
 to produce it; the sense which he has manifested of the great importance of 
 such an institution, to the successful administration of the department tinder 
 his particular care, and an expectation of serious ill consequences to result 
 from a failure of the measure, do not permit him to be without anxiety on 
 public accounts. But the chief solicitude arises from a firm persuasion, that 
 principles of construction, like those espoused by the Secretary of State and 
 Attorney General, would be fatal to the just and indispensable authority of 
 the United States. 
 
 In entering upon the argument, it ought to be premised, that the objections 
 of the Secretary of State and Attorney General, are founded on a general de- 
 nial of the authority of the United States to erect corporations. The latter, 
 indeed, expressly admits, that, if there be any thing in the bill which is not 
 warranted by the constitution, it is the clause of incorporation. 
 
 Now, it appears to the Secretary of the Treasury, that this general princi- 
 ple is inherent in the very definition of government, and essential to every 
 step of the progress to be made by that ot the United States; namely, that 
 every power vested in a government, is, in its nature, SOVEREIGN, and in- 
 cludes, by force of the term, a right to employ all the means requisite, and 
 fairly applicable, to the attainment of the ends of such povvec, and which are. 
 not precluded by restrictions and exceptions specified in the constitution, or 
 not immoral, or not contrary to the essential ends of political society. 
 
 This principle, in its application to government in general, would be ad- 
 mitted as an axiom: and it will be incumbent upon those who may incline to 
 deny it, to prove a distinction, and to show, that a rule which, in the general 
 system of things, is essential to the preservation of the social order, is inap- 
 plicable to the United States. 
 
 The circumstance, that the powers of sovereignty are, in this country, di- 
 vided between the National and State Governments, does not aftbrd the dis- 
 tinction required. It does not follow from this, that each of the portions of 
 power delegated to the one or to the other, is not sovereign with regard to its 
 proper objects. It will only follow from it, that each has sovereign power as 
 to certain things, and not as to other things. To deny that the Government 
 of the United States has sovereign power as to its declared purposes and trusts, 
 because its power does not extend to all laws, would be equally to deny that 
 the State Governments have sovereign power in any case, because their power 
 does not extend to every case. The tenth section of the first article of the 
 constitution, exhibits a long list ot very important things which they may 
 not do; and thus the United States would furnish the singular spectacle of 
 
96 BANK OF THE UNITED STATES. 
 
 a political society without sovereignty; or of a people governed without 
 government. 
 
 If it would be necessary to bring proof to a proposition so clear, as that 
 which affirms that the powers 01 the Federal Government, as to its ob- 
 jects, are sovereign, there is a clause of its constitution which would be deci" 
 sive: it is that which declares, that the constitution, and the laws of the Unit- 
 ed States made in pursuance of it, and all treaties made, or which shall be 
 made, under their authority, shall be the supreme law of the land. The power 
 which can create the supreme law of the land, in any case, is doubtless sove- 
 reign as to such case. 
 
 This general and indisputable principle puts at once an end to the abstract 
 question, whether the United States have power to erect a corporation; that 
 is to say, to give a legal or artificial capacity to one or more persons, distinct 
 from the natural? For it is unquestionably incident to sovereign power, to 
 erect corporations; and, consequently, to that of the United States, in rela- 
 tion to the objects intrusted to the management of the Government. 
 
 The difference is this: where the authority of the Government is general, it 
 can create corporations in all cases; where it is confined to certain branches 
 of legislature, it can create corporations only in those cases. 
 
 Here, then, as far as concerns the reasonings of the Secretary of State and 
 the Attorney General, the affirmative of the constitutionality ot the bill might 
 be permitted to rest. It will occur to the President, that the principle here 
 advanced has been untouched by either of them. 
 
 Nevertheless, for a more complete elucidation of the point, the arguments 
 which they had used against the power of the Government to erect corpora- 
 tions, however foreign they are to the great fundamental rule which has been 
 stated, shall be particularly examined. And after showing that they do not 
 tend to impair its force, it shall also be shown, that the power of incorpora- 
 tion, incident to the Government in certain cases, does fairly extend to the 
 particular case which is the object of the bill. 
 
 The first of these arguments is, that the foundation of the constitution is 
 laid on this ground, " that all powers, not delegated to the United States by 
 the constitution, nor prohibited to it by the States, are reserved for the States 
 or to the People;" whence, it is nieant to be inferred, that Congress can, in 
 no case, exercise any power not included in those, nor not enumerated in the 
 constitution. And it is affirmed, that the power of erecting a corporation is 
 not included in any of the enumerated powers. 
 
 The main proposition here laid down, in its true signification, is] not to be 
 questioned. It is nothing more than a consequence of this republican maxim, 
 that all government is a delegation of power; but how much is delegated in 
 each case, is a question of fact, to be made out by fair reasoning and con- 
 struction, upon the particular provisions of the constitution taking as guides, 
 the general principles and general ends of government. 
 
 It is not denied that there are implied, as well as express powers; and that 
 the former are as effectually delegated as the latter: and, for the sake of ac- 
 curacy, it shall be mentioned, that there is another class of powers, which 
 may be properly denominated resulting powers. It will not be doubted, that, 
 if the United States should make a conquest of any of the territories of its 
 neighbors, they would possess sovereign jurisdiction over the conquered ter- 
 ritory. This would rather be a result from the whole mass of the powers of 
 the Government, and from the nature of political society, than a consequence 
 of either of the powers specially enumerated. 
 
 But, be this as it may, it furnishes a striking illustration of the general doc- 
 trine contended for. It shows an extensive case, in which a power of erect- 
 ing corporations is either implied in, or would result from, some, or all of the 
 powers, vested in the National Government. The jurisdiction acquired over 
 such conquered territory, would certainly be competent to every species of 
 legislation. 
 
 To return: It is conceded, that implied powers are to be considered as de- 
 legated equally with express ones. 
 
CHARTER OF 179L 97 
 
 Then it follows, that, as a power of erecting a corporation may as well be 
 implied as any _ other thing, it may as well be employed as an instrument or 
 mean of carrying into execution any of the specified powers, as any other in- 
 strument or mean whatever. The only question must be, in this, as in every 
 other case, whether the mean to be employed, or, in this instance, the corpo- 
 ration to be erected, has a natural relation toanyof the acknowledged objects 
 or lawful ends of the Government? Thus, a corporation may not be erected 
 by Congress for superintending the police of the city of Philadelphia, because 
 they are not authorized to regulate the police of that city. But one may be 
 erected in relation to the collection of taxes, or to the trade with foreign coun- 
 tries, or to the trade between the States, or with the Indian tribes; because it 
 is the province of the Federal Government to regulate those objects; and be- 
 cause it is incident to a general sovereign or legislative power to regulate a 
 thing, to employ all the means which relate to its regulation, to the best and 
 greatest advantage. 
 
 A strange fallacy seems to have crept into the manner of thinking and rea- 
 soning upon the subject. Imagination appears to have been unusually busy 
 concerning it. An incorporation seems to have been regarded as some great 
 independent substantive thing; as a political engine, and of peculiar magni- 
 tude and moment: whereas it is truly to be considered as a Quality, capacity, 
 or mean to an end. Thus, a mercantile company is formed with a certain 
 capital, for the purpose of carrying on a particular branch of business. Here 
 the business to be prosecuted is the end. The association, in 9ixler to form 
 the requisite capital, is the primary mean. Suppose that an incorporation 
 were added to this; it would only be to add a new quality to that association; 
 to give it an artificial capacity, by which it would be enabled to prosecute the 
 business with more safety and convenience. 
 
 That the importance of the power of incorporation has been exaggerated, 
 leading to^erroneous conclusions, will further appear, from tracing it to its 
 origin. The Roman law is the source of it: according to which, a voluntary 
 association of individuals, at any time, or for any purpose, was capable of 
 producing it. In England, whence our notions of it are immediately borrow- 
 ed, it seems part of the executive authority: and the exercise of it has been 
 often delegated by that authority: whence, therefore, the ground of the sup- 
 position, that it lies beyond the reach of all those very important portions of 
 sovereign power, legislative as well as executive, which belong to the Govern- 
 ment of the United States. 
 
 To this mode of reasoning, respecting the right of employing all the means 
 requisite to the execution of the specified powers of the Government, it is ob- 
 jected, that none but necessary and proper means are to be employed; and the 
 Secretary of State maintains, that no means are to be considered as neces- 
 sary but those without which the grant of the power would be nugatory. 
 Nay, so far does he go in his restrictive interpretation of the word, as even to 
 make the case of necessity, which shall warrant the constitutional exercise of 
 the power, to depend on casual and temporary circumstances; an idea which 
 alone refutes the construction. The expediency of exercising a particular 
 power, at a particular time, must, indeed, depend on circumstances; but the 
 constitutional right of exercising it must be uniform and invariable, the same 
 to-day as to-morrow. 
 
 All the arguments, therefore, against the constitutionality of the bill, derived 
 from the accidental existence of certain State banks, institutions which hap- 
 pen to exist to-day, and, for aught that concerns the Government of the Unit- 
 ed States, may disappear to-morrow, must not only be rejected as fallacious, 
 but must be viewed as demonstrative that there is a radical source of error in 
 the reasoning. 
 
 It is essential to the being of the National Government, that so erroneous a 
 conception of the meaning of the word necessary should be exploded. 
 
 It is certain, that neither the grammatical, nor popular sense of the term, 
 requires that construction. According to both, necessary often means no 
 more than needful, requisite, incidental, useful, or conducive to. It is a com- 
 13 
 
08 BANK OF THE UNITED STATES. 
 
 mon mode of expression to say, that it is necessary for a government or a 
 person to do this or that thing, when nothing more is intended or under- 
 stood than that the interest ot the Government or person require, or will 
 be promoted by, the doing of this or that thing. The imagination can be at no 
 loss for exemplification of the use of the word in this sense. 
 
 And it is the true one in which it is to be understood, as used in the con- 
 stitution. The whole turn of the clause containing it, indicates that it was 
 the intent of the convention, by that clause, to give a liberal latitude to the 
 exercise of the specified powers. The expressions have a peculiar compre- 
 hensiveness. They are, to make all laws necessary and proper for carrying 
 into execution the foregoing powers, and all other powers vested by the con- 
 stitution in the Government of the United States, or in any department or 
 office thereof. To understand the word as the Secretary of State does, would 
 be to depart from its obvious and popular sense, and to give it a restrictive 
 opera tion; an idea never before entertained. It would be to give it the same 
 force as if the word absolutely, or indispensably, had been prefixed to it. 
 
 Such a construction would beget endless uncertainty and embarrassment. 
 The cases must be palpable and extreme, in which it could be pronounced 
 with certainty, that a measure was absolutely necessary; or one, without 
 which the exercise of a given power would be nugatory. There are few mea- 
 sures of any government which would stand so severe a test. To insist upon 
 it, would be to make the criterion of the exercise of any implied power, a case 
 of extreme necessity; which is rather a rule to justify the overleaping of the 
 bounds of constitutional authority, than to govern the ordinary exercise of it. 
 
 It may be truly said of every Government, as well as that of the United 
 States, that it has only a right to pass such laws as are necessary and proper to 
 accomplish the objects intrusted to it: for no government has a right to do 
 merely what it pleases. Hence, by a process ot reasoning similar to that of 
 the Secretary of State, it might be proved that neither of the State Govern- 
 ments has a right to incorporate a bank. It might be shown, that all the pub- 
 lic business of the State could be performed without a bank; and, inferring 
 thence that it was unnecessary, it might be argued, that it could not be done, 
 because it is against the rule which has been just mentioned. 
 
 A like mode of reasoning would prove, that there was no power to incorpo- 
 rate the inhabitants of a town with a view to a more perfect police: for it is 
 certain, that an incorporation may be dispensed with, though it is better to 
 have one. It is to be remembered, that there is no express power in any 
 State constitution to erect corporations. 
 
 The degree in which a measure is necessary, can never be a test of the legal 
 right to adopt it. That must be a matter of opinion, and can only be a test 
 of expediency. The relation between the measure and the end; between the 
 nature of the mean employed towards the execution of a power, and the ob- 
 ject of that power; must be the criterion of constitutionality; not the more or 
 less of necessity or utility. 
 
 The practice of the Government is against the rule of construction advocat- 
 ed by the Secretary of State. Of this, the act concerning light houses, bea- 
 cons, buoys, and public piers, is a decisive example. This, doubtless, must 
 lie referred to the power of regulating trade, and is fairly relative to it. But 
 it cannot be affirmed, that the exercise of that power, in this instance, was 
 strictly necessary; or, that the power itself would be nugatory without that 
 of regulating establishments of this nature. 
 
 This restrictive interpretation of the word necessary, is also contrary to this 
 sound maxim of construction; namely, that the powers contained in a consti- 
 tution of government, especially those which concern the general administra- 
 tion of the affairs of a country, its finances, trade, defence, &c. ought to be 
 construed liberally in advancement of the public good. This rule does not 
 depend on the particular form of a government, or on the particular demarca- 
 tion of the boundaries of its powers, but on the nature and objects of govern- 
 ment itself. The means by which national exigencies are to be provided for ; 
 national inconveniencies obviated; national prosperity promoted; are of such 
 
CHARTER OF 1791. < 
 
 infinite variety, extent, and complexity, that there must, of necessity, be great 
 latitude of discretion in the selection and application of those means. Hence, 
 consequently, the necessity and propriety of exercising the authorities intrust- 
 ed to a government, on principles of liberal construction. 
 
 The Attorney General admits the rule, but takes a distinction between a 
 State and the Federal constitution. The latter, he thinks, ought to be con- 
 strued with greater strictness, because there is more danger of error in defin- 
 ing partial than general powers. 
 
 IJut the reason of the rule forbids such a distinction. This reason is, the 
 variety and extent of public exigencies, a far greater proportion of which, and 
 of a far more critical kind, are objects of national, than of State administra- 
 tion. The greater danger of rror, as far as it is supposeable, may be a pru- 
 dential reason for caution iu practice, but it cannot be a rule of restrictive in- 
 terpretation. 
 
 In regard to the clause of the constitution immediately under consideration, 
 it is admitted by the Attorney General, that no restrictive effect can be as- 
 cribed to it. He defines the word necessary, thus: fci To be necessary, is to 
 * 4 be incidental^ and may be denominated the natural means of executing a 
 power. " 
 
 But while, on the one hand, the construction of the Secretaiy of State 
 is deemed admissible, it will not be contended, on the other, that the clause 
 in question gives any new or independent power. But it gives an explicit 
 sanction to the doctrine of implied powers, and is equivalent to an admission 
 of the proposition, that the Government, as to Us specified powers and 06- 
 jec.ts, has plenary and sovereign authority; in some cases, paramount to that 
 of the States; in others, co-ordinate with it. For such is the plain import 
 of the declaration, that it may pass all LAWS necessary and proper to carry 
 into execution thoso powers. 
 
 It is no valid objection to the doctrine, to say, that it is calculated to ex- 
 tend the powers of the General Government throughout the entire sphere of 
 State legislation. The same thing has been said, and may be said, with re- 
 gard to every exercise of power, by implication or construction. The mo- 
 ment the literal meaning is departed from, there is a chance of error and 
 abuse: and yet an adherence to the letter of its powers would at once arrest the 
 motion of Government. It is not only agreed, on all hands, that the exercise 
 of constructive powers is indispensable, but evety act which has been passed, 
 is more or less an exemplification of it. One has already been mentioned; 
 that relating to light houses, &c. That which declares the power of the Pre 
 sident to remove officers at pleasure, acknowledges the same truth in another, 
 and a signal instance. 
 
 The truth is, that difficulties on this point are inherent in the nature of the 
 federal constitution. They result inevitably from a division of legislative 
 power. The consequence of this division is, that there will be cases clearly 
 within the power ot the National Government, others, clearly without its 
 power; and a third class, which will leave room for controversy and difference 
 of opinion, and concerning which a reasonable latitude of judgment must be 
 allowed. 
 
 But the doctrine \yhich is contended for, is not chargeable with the conse 
 quences imputed to it. It does not affirm that the National Government is 
 sovereign in all respects, but that it is sovereign to a certain extent; that is, to 
 the extent of the objects of its specified powers. 
 
 It leaves, therefore, a criterion of what is constitutional, and of what is not 
 so. This criterion is the end to which the measure relates as a mean. If the 
 end be clearly comprehended within any of the specified powers, and if the 
 measure have an obvious relation to that end, and is not forbidden by any par* 
 ticular provision of the constitution, it may safely be deemed to come within 
 the compass of the national authority. There is, also, this further criterion, 
 which may materially assist the decision. Does the proposed measure abridge 
 a pre-existing right of any State, or of any individual? If it does not, there 
 is a strong presumption in favor of its constitutionality; and slighter re- 
 
100 BANK OF THE UNITED STATES. 
 
 lations to any declared object of the constitution, may be permitted to 
 the scale. 
 
 The general objections which are to be inferred from the reasonings of the 
 Secretary of State and Attorney General, to the doctrine which has peen ad- 
 vanced, have been stated; and, it is hoped f satisfactorily answered. Those of 
 a more particular nature shall now be examined. 
 
 The Secretary of State introduces Iris opinion witlv an observation, that 
 the proposed incorporation undertakes to create certain capacities, properties, 
 or attributes, which are against the laws of alienage, descents, escheat and 
 forfeiture^ distribution and monopoly; and to confer a power to make laws 
 paramount to those of the States. And nothing, says he, in another place, but 
 a necessity, invincible bv other means, can justify such a prostration of laws, 
 which constitute the pillars of our whole system of jurisprudence, and are the 
 foundation laws of the State Governments. 
 
 If these are truly the foundation laws of the several State?, then have most 
 of them subverted their own foundations: for there is scarcely one of them 
 which has not, since the establishment of its particular constitution, made ma- 
 terial alterations in some of those branches of its jurisprudence, especially the 
 law of descents. But it is not conceived how any thing can be called the 
 fundamental law of a State government, which is not established in its con- 
 stitution, unalterable by the ordinary legislature. And, with regard to the 
 question of necessity, it has been shown, that this can only constitute a ques- 
 tion of expediency, not of right. 
 
 To erect a corporation, is to substitute a legal or artificial, for a natural 
 person; and, where a number are concerned, to give them individuality. To 
 that legal or artificial person, onee created, the common law of every State, 
 of itself, annexes all those incidents and attributes which are represented as 
 a prostration of the main pillars of their jurisprudence. It is certainly not ac- 
 curate to say, that the erection of a corporation is against those different heads 
 of the State laws; because, it is rather to create a kind of person, or entity, 
 to which they are inapplicable, and to which the general rule of those laws 
 assigns a different regimen. The laws of alienage cannot apply to an artificial 
 person, because it can have no country. Those of descent cannot apply to 
 it, because it can have no heirs. Those of escheat are foreign from it, tor the 
 same reason. Those of forfeiture, because it cannot commit a crime. Those 
 of distribution, because, though it may be dissolved, it cannot die. As truly 
 might it be said, that the exercise ot the power of prescribing the rule bv 
 which foreigners shall be naturalized, is against the law of alienage, while it 
 is, in fact, only to put them into a situation to cease to be the subjects of that 
 law. To do a thing which is against the law, is to do something which it for- 
 bids, and which is a violation of it. 
 
 But, if it were even to be admitted that the erection of a corporation is a 
 direct alteration of the State laws, in the enumerated particulars, it would do 
 nothing towards proving that the measure was unconstitutional. If the Go- 
 vernment of the United State can do no act which amounts to an alteration of 
 a State law, all its powers are nugatory: for almost every new law is an alter- 
 ation, in some way or other, of an old law, either common or statute. 
 
 There are laws concerning bankruptcy in some States. Some States have 
 laws regulating the value of foreign coins. Congress are empowered to esta- 
 blish uniform Taws concerning bankruptcy throughout the United States, and 
 to regulate the value of foreign coins. The exercise of either of these powers 
 by Congress, necessarily involves an alteration of the laws of those States. 
 
 Again: every person, by the common law of each State, may export his 
 property to foreign countries at pleasure; but Congress, in pursuance of the 
 power of regulating trade, may prohibit the exportation of commodities; in 
 doing which, they would alter the common law of each State, in abridgment 
 of individual right. 
 
 It can, therefore, never be good reasoning to say, this or that act is uncon- 
 stitutional, because it alters this or that law of a State; it must be shown that 
 the act, which makes the alteration, is unconstitutional on other accounts; not 
 because it makes the alteration. 
 
CHARTER OF H91. 
 
 There arc two points in the suggestions of the Secretary of State, which 
 have been noted, that are peculiarly incorrect. One is, that the proposed in- 
 corporation is against the laws of monopoly, because it stipulates an exclusive 
 right of banking under the national authority: the other, that it gives power to 
 the institution to'make laws paramount to those of the States. 
 
 But with regard to the first point, the bill neither prohibits any State from 
 erecting as many banks as it pleases, nor any number of individuals from as- 
 sociating; to carry on the business; and, consequently, is free from the charge 
 of establishing a monopoly: for monopoly implies a legal impediment to the 
 carrying on the trade by others than those to whom it is granted. 
 
 And, with regard to the second point, there is still less foundation. The 
 by-laws of such an institution as a bank, can operate only upon its own mem- 
 bers; can only concern the disposition of its own property; and must essen- 
 tially resemble the rules of a private mercantile partnership. They are, ex- 
 pressly, not to be contrary to law; and law must here mean the law of a State, 
 as well as of the United States. There can never be a doubt, that a law of a 
 corporation, if contrary to a law of a State, must be overruled as void, unless 
 the law of the State is contrary to that of the United States: and then the 
 question will not be between the law of the State and that ot the corporation, 
 but between the law of the State and that of the United States. 
 
 Another argument made use-of by the Secretary of State is, the rejection, by 
 the convention, of a proposition to empower Congress to make corporations, 
 either generally, or for some special purpose. What was the precise nature 
 or extent of this proposition, or what the reasons for refusing it, is not ascer- 
 tained by any authentic document, or even by accurate recollection. As far 
 as any such document exists, it specifies only canals. If this was the amount 
 of it, it would, at most, only prove, that it was thought inexpedient to give a 
 power to incorporate for the purpose of opening canals; for which purpose a 
 special power would have been necessary, except with regard to the \VesUrn 
 territory; there being nothing in any part of the constitution respecting the 
 regulation of canals. It must be confessed, however, that very different ac- 
 counts are given of the import of the proposition, and of the motives tor re- 
 jecting it. Some affirm that it w;ts confined to the opening of canals and ob- 
 structions in rivers; others, that it embraced banks; and others, that it ex- 
 tended to the power of incorporating generally. Some again allege, that it 
 was disagreed to, because it was thought improper to vest in Congress a power 
 of erecting corporations; others, because it was thought unnecessary to spe- 
 cify the power, and inexpedient to furnish an additional topic of objection to 
 the constitution. In this state of the matter, no inference whatever can be 
 drawn from it. 
 
 But, whatever may have been the nature of the proposition, or the reasons 
 for rejecting it, nothing is included by it; that is, the proposition, in respect 
 to the real merits of the question. The Secretary of State will not deny, that, 
 whatever may have been the intentions of the (ramers of a constitution, or of 
 a law, that intention is to be sought for in the instrument itself, according to 
 the usual and established rules of construction. Nothing is more common 
 than for laws to express and effect more or less than was intended. If, then, 
 a power to erect a corporation, in any case, be deducible by fair inference 
 from the whole, or any part, of the numerous provisions of the constitution of 
 the United States, arguments, drawn from extrinsic circumstances regarding 
 the intention of the convention, must be rejected. 
 
 Most of the arguments of the Secretary of State, which have not been con- 
 sidered in the foregoing remarks, are of a nature rather to apply to the expe- 
 diency, than to the constitutionality of the bill. They will, however, be no- 
 ticed in the discussion which will be necessary in reference to the particular 
 heads of the powers of the Government, which are involved in the question. 
 
 Those of the Attorney General will now properly come under view. 
 
 His first observation is, that the power of incorporation is not expressly 
 given to Congress. This shall be conceded, but in this sense only that it is 
 not declared in express terms that Congress may erect a corporation. But 
 
102 BANK OF THE UNITED STATES. 
 
 this cannot mean that there are not certain express powers, which necessarily 
 include it. 
 
 For instance, Congress have express power to exercise exclusive legislation 
 in all cases whatsoever, over surh district (not exceeding ten miles square) 
 as may, by cession of particular States, and the acceptance of Congress, be- 
 come the seat of the Government of the United States; and to exercise like 
 authority over all places purchased by consent of the legislature of the State 
 in which the same shall be, for the erection efforts, arsenals, dock yards, and 
 other needful buildings. 
 
 Here, then, is express power to exercise exclusive legislation, in all cases 
 whatsoever, over certain places; that is, to do, in respect to those places, all 
 that any government whatever may do: for language does not afford a more 
 complete designation of sovereign power, than in those comprehensive terms. 
 It is, in other words, a power to pass all laws whatsoever, and, consequently, 
 to pass all laws for erecting corporations, as well as for any other purpose, 
 which is the proper object of law in a free government. Surely, it can never 
 be believed, that Congress, with exclusive power of legislation, in all cases 
 whatsoever, cannot erect a corporation within the district which shall become 
 the seat of Government, for the better regulation of its police; and yet there 
 is an unqualified denial of the power to erect corporations, in every case, on 
 the part both of the Secretary of State and of the Attorney General, The 
 former, indeed, speaks of that power in these emphatical terms: that it is a 
 right remaining exclusively with the Stales. 
 
 As far, then, as there is an express power to do any particular act tf legisla- 
 tion, there is an express one to erect corporations in the case above described. 
 But, accurately speaking, no particular power, is more than implied in a gen- 
 eral one. Thus, the power to lay a duty on a gallon of rum, is only a particu- 
 lar, implied in the general power to lay and collect taxes, duties, imposts, and 
 excises. This serves to explain in what sense it may be said, that Congress 
 have not an express power to make corporations. 
 
 This may not be an improper place to take notice of an argument which was 
 used in debate in the House of Representatives. It was there urged, that if 
 the constitution intended to confer so important a power as that of erecting 
 corporations, it would have been expressly mentioned. But the case which 
 has been noticed, is clearly one in which such power exists, and yet without 
 any specification or express grant of it, further than as every particular, im- 
 plied in a general power, can be said to be so granted. 
 
 But the argument itself is founded upon an exaggerated and erroneous con- 
 ception of the nature of the power. It has been shown, that it is not of so 
 transcendent a kind as the reasoning supposes, and that, vjewed in a just 
 light, it is a mean which ought to have been left to implication, rather than 
 an end which ought to have been expressly granted. 
 
 Having observed, that the power of erecting corporations is not expressly 
 granted to Congress, the Attorney General proceeds thus: 
 
 If it can be exercised by them, it must be, 
 
 1. Because the nature of Federal Government implies it. 
 
 2. Because it is involved in some of the specified powers of legislation. 
 
 3. Because it is necessary and proper, to carry into execution some of the 
 specified powers. 
 
 To be implied in the nature of the Federal Government, says he, would 
 beget a doctrine so indefinite as to grasp at every power. 
 
 This proposition, it ought to be remarked, is not precisely 9r even substan- 
 tially, that which has been relied upon. The proposition relied upon is, that 
 the specified powers of Congress are, in their nature, sovereign; that itis inci- 
 dent to sovereign power to erect corporations; and that, therefore, Congress 
 have a right, within the sphere, and in relation to the objects of their power, 
 io ereti corporations. 
 
 It shall, however, be supposed, that the Attorney General would consider 
 the two propositions in the same light, and that the objection made to the one 
 would be made to the other. 
 
CHARTER OF 1791. JQ3 
 
 To this objection an answer has been already given. It is this: that the 
 doctrine is stated with this express qualification, that the right to erect cor- 
 porations does only extend to cases and objects within the sphere of the speci- 
 fied powers of the Government. A general legislative authority, implies a 
 power to erect corporations in all cases; a particular legislative power, im- 
 plies authority to erect corporations in relation to cases arising under that 
 power only. Hence the affirming, that, as incident to sovereign power, Con- 
 gress may erect a corporation in relation to the collection of their taxes, is no 
 more to affirm that they may do whatever else they please, than the saying 
 they have a power to regulate, trade, would be to affirm, that they have a 
 power to regulate religion; or than the maintaining, that they have sovereign 
 power as to taxation, would be to maintain, that they have sovereign power as 
 to every thing else. 
 
 The Attorney General undertakes, in the next place, to show, that the 
 power of erecting corporations is not involved in any of the specified powers 
 of legislation confided to the National Government. 
 
 In order to do this, he has attempted an enumeration of the particulars which 
 he supposes to be comprehended under the several heads of the POWERS to lay 
 and collect taxes, &c. to borrow money on the credit of the United States; to 
 regulate commerce with foreign nations, between the States, and with the In- 
 dian tribes; to dispose of, and make all needful rules and regulations respect- 
 ing the territory, or other property belonging to the United States: the de- 
 sign of which enumeration is to show, what is included under those different 
 heads of power; and negatively, that the power of erecting corporations is 
 not included. 
 
 The truth of this inference, or conclusion, must depend on the accuracy of 
 the enumeration. If it can be shown that the enumeration is defective, the 
 inference is destroyed. To do this, will be attended with no difficulty. 
 
 The heads of the power to lay and collect taxes, he states to be 
 
 1. To ascertain the subject of taxation, &.c. 
 
 2. To declare the quantum of taxation, &LC. 
 
 3. To prescribe the mode of collection. 
 
 4. To ordain the manner of accounting for the taxes, &c. 
 
 The defectiveness of this enumeration consists in the generality of the third 
 division, "to prescribe the mode of collection^ which is in itself' an immense 
 chapter. It will be shown hereafter, that, among a vast variety of particulars, 
 it comprises the very power in question, namely, to erect corporations. 
 
 The heads of the power to borrow money, are stated to be 
 
 I. To stipulate the sum to be lent. 
 [. An interest or -no interest to be paid. 
 
 III. The time and manner of repaying, unless the loan be placed on an 
 irredeemable fund. 
 
 This enumeration is liable to a variety of objections. It omits, in the first 
 
 Klace, the pledging or mortgaging of a fund for the security of the money 
 ?nt; an usual, and, in most cases, an essential ingredient. 
 
 The idea of a stipulation of an interest or no interest., is too confined. It 
 should rather have been said, to stipulate the consideration of the loan. Indi- 
 viduals often borrow upon considerations other than the payment of interest. 
 So may Government; and so they often find it necessary to do. Every one 
 recollects the lottery tickets and other douceurs, often given in Great Britain 
 as collateral inducements to the lending of money to the Government. 
 
 There are, also, frequently collateral conditions, which the enumeration 
 does not contemplate. Every contract which has been made for moneys bor- 
 rowed in Holland, includes stipulations, that the sum due, shall be free from 
 taxes, and from sequestration in time of war; and mortgages all the land and 
 property of the United States for the reimbursement. 
 
 It is also known, that a lottery is a common expedient for borrowing money, 
 which certainly does not fall under either of the enumerated heads. 
 
 The heads of the power to regulate commerce with foreign nations, are 
 stated to be 
 
104 BANK OF THE UNITED STATES. 
 
 1 . To prohibit them or their commodities from our ports. 
 
 2. To impose duties on them where none existed before, or to increase exist- 
 ing duties on them. 
 
 3. To subject them to any species of custom house regulation. 
 
 4. To grant them any exemptions or privileges which policy may suggest. 
 This enumeration is far more exceptionable than either of the former: it 
 
 omits every thing that relates to the citizens, vessels, or commodities, of the 
 United States. 
 
 The following palpable omissions occur at once: 
 
 I. Of the power to prohibit the exportation of commodities, which not only 
 exists at all times, but which, in time of war, it would be necessary to exer- 
 cise, particularly with relation to naval and warlike stores. 
 
 II. Of the power to prescribe rules concerning the charactistics and privi- 
 leges of an American bottom; how she shall be navigated ; as, whether by 
 citizens or foreigners, or by a proportion of each. 
 
 III. Of the power of regulating the manner of contracting with seamen, the 
 policies of ships on their voyages, &c. of which the act for the government 
 and regulation of seamen in the merchant service is a specimen. 
 
 That the three preceding articles are omissions, will not be doubted. There 
 is a long list of items in addition, which admit of little, if any, question, of 
 which a few samples shall be given. 
 
 I. The granting of bounties to certain kinds of vessels and certain species 
 of merchandise; of this nature is the allowance on dried and pickled fish and 
 salted provisions. 
 
 II. The prescribing of rules concerning the inspection of commodities to be 
 exported. Though me States, individually, are competent to this regulation, 
 yet there is no reason, in point of authority at least, why a general system 
 might not be adopted by the United States. 
 
 III. The regulation of policies of insurance; of salvage upon goods found 
 at sea; and the disposition of such goods. 
 
 IV. The regulation of pilots. 
 
 V. The regulation of bills of exchange, drawn by a merchant of one State 
 upon a merchant of another State. This last rather belongs to the regulation 
 of trade between the States, but is equally omitted in the specification under 
 that head. 
 
 The last enumeration relates to the power to dispose of, and make all need- 
 ful rules and regulations respecting the territory or other property belonging 
 to the United States. 
 
 The heads of this power are said to be, 
 
 I. To exert an ownership over the territory of the United States which may 
 be properly called the property of the United States, as in the Western ter- 
 ritory, and to institute a government therein; or, 
 
 II. To exert an ownership over the other property of the United States. 
 This idea of exerting an ownership over the territory or other property of 
 
 the United States, is particularly indefinite and vague. It does not at all sa- 
 tisfy the conception of what must have been intended by a power to make all 
 needful rules and regulations; nor would there have been any use for a spe- 
 cial clause, which authorized nothing more: for the right of exerting an own- 
 ership, is implied in the very definition of property. 
 
 It is admitted, that, in regard to the Western territory, something more is 
 intended: even the institution of a government, that is, the creation of a body 
 politic, or corporation of the highest nature; one which, in its maturity, will 
 DC able itself to create other corporations. Why, then, does not the same 
 clause authorize the erection of a corporation in respect to the regulation or 
 disposal of any other of the property of the United States? 
 
 This idea will be enlarged upon in another place. 
 
CHARTER OF 1791. 1Q5 
 
 Hence, it appears that the enumerations which have been attempted by the 
 Attorney General, are so imperfect as to authorize no conclusion whatever. 
 They, therefore, have no tendency to disprove, that each and every ot the 
 powers to which they relate, includes that of erecting corporations, which 
 they certainly do, as the subsequent illustrations will more arid more evince. 
 
 It is presumed to have been satisfactorily shown, in the course of the preced- 
 ing observations: 
 
 I. That the power of the Government, as to the objects intrusted to its man- 
 agement, is, in its nature, sovereign. 
 
 II. That the right of erecting corporations, is one inherent in, and insepa- 
 rable from, the idea of sovereign power- 
 
 III. That the position, that the Government of the United States can exer- 
 cise is) power but such as is delegated to it by its constitution, does not 
 militate against this principle. 
 
 IV. That the word ?iecessan/, in the general clause, can have no restrictive 
 operation, derogating from the force of this principle; indeed, that the degree 
 in which a measure is, or is not, necessary, cannot be a test of constitutional 
 right, but of expediency only. 
 
 V. That the power to erect corporations, is not to be considered as an 
 independent and substantive power, but as an incidental and auxiliary one; 
 and was, therefore, more properly left to implication, than expressly granted. 
 
 VI. That the principle in question does not extend the power of the Govern- 
 ment beyond the prescribed limits, because it only affirms a power to incor- 
 porate for purposes within the sphere of the specified powers. 
 
 And, lastly, that the right to exercise such a power, in certain cases, is une- 
 quivocally granted in the most positive and comprehensive terms. 
 
 To all which it only renaaina to be added, that such a power has actually 
 been exercised in two very eminent instances, namely, in the erection of two 
 governments; one northwest of the river Ohio, and the other southwest; the 
 last independent of any antecedent compact. 
 
 And there results a full and complete demonstration, that the Secretary of 
 State and Attorney General are mistaken, when they deny, generally, the 
 power of the National Government to erect corporations, 
 
 It shall now be endeavored to be shown, that there is a power to erect one 
 of the kind proposed by the bill. This will be done by tracing a natural and 
 obvious relation between the institution of a bank, and the objects of several 
 of the enumerated powers of the Government; and by showing, that, political- 
 ly speaking, it is necessary to the effectual execution of one or more of those 
 powers. In the course of this investigation, var'wus instances will be stated, 
 by way of illustration, of a right to erect corporations under those powers. 
 
 Some preliminary observations may be proper. 
 
 The proposed bank is to consist of an association of persons, for the purpose 
 of creating a joint capital, to be employed, chiefly and essentially, in loans. 
 So far, the object js not only lawful, but it is the mere exercise of a right 
 which the law allows to every individual. The Bank of New York, which is 
 not incorporated, is an example of such an association. The bill proposes, in 
 addition, that the Government shall become a joint proprietor in this under- 
 taking; and that it shall permit the bills of the company, payable on demand, 
 to be receivable in its revenues; and stipulates that it shall not grant privileges, 
 similar to those which are to be allowed to this company, to any others. All 
 this is incontrovertibly within the compass of the discretion ot the Govern- 
 ment. The only question is, whether it has a right to incorporate this com- 
 pany, in order to enable it the more effectually to accomplish ends which are 
 in ^themselves lawful. 
 
 To establish such a right, it remains to show the relation of such an institu- 
 tion, to one or more of the specified powers of the Government. 
 
 Accordingly, it is affirmed, that it has a relation, more or less direct, to the 
 power of collecting taxes; to that of borrowing money; to that of regulatin" 
 14 
 
106 BANK OP THK UNITED STATES. 
 
 trade between the States: and to those of raising and maintaining fleets and 
 armies. To the two former, the relation may be said to be immediate. 
 
 And, in the last place, it will be argued, that it is clearly within the provi- 
 sion which authorizes the making of all needful rules and regulations con- 
 cerning the property of the United States, as the same has been practised 
 upon by the Government. 
 
 A bank relates to the collection of taxes in two ways. Indirectly, by 
 increasing the quantity of circulating medium and quickening circulation, 
 which facilitates the means of paying; directly, by creating a convenient 
 species of medium in which they are to be paid. 
 
 To designate or appoint the money or thins in which taxes are to be paid, is 
 not only a proper, but a necessary exercise of the power of collecting them. 
 Accordingly, Congress, in the law concerning the collection of the duties on 
 imposts and tonnage, have provided that they shall be payable in gpid and 
 silver. But, while it was an indispensable part of the work to say in what 
 they should be paid, the choice of the specific thing was mere matter of dis- 
 cretion. The payment might have been required in the commodities them- 
 selves. Taxes, in kind however ill judged, are not without precedents even 
 in the United States; or it might have been in the paper money of the several 
 States, or in the bills of the Bank of North America, New York, and Massa- 
 chusetts, all or either of them; or it might have been in bills issued under the 
 authority of the United States, 
 
 No part of this can, it is presumed, be disputed. The appointment, then, 
 of the monev or thing in which the taxes are to be paid, is an incident to the 
 power of collection. And among the expedients which may be adopted, is 
 that of bills issued under the authority of the United States. 
 
 Now, the manner of issuing these bills, is again matter of discretion. The 
 Government might, doubtless, proceed in the following manner: it might pro- 
 vide that they should be issued under the direction of certain officers, paya- 
 ble on demand; and in order to support their credit, and give them a ready 
 circulation, it might, besides giving them a currency in its taxes, set apart, 
 out of any moneys in its treasury, a given sum, and appropriate it, under the 
 direction of those officers, as a fund for answering the bills, as presented for 
 payment. 
 
 The constitutionality of all this would not admit of a question, and yet it 
 would amount to the institution of a bank, with a view to the more conve- 
 nient collection of taxes. For the simplest and most precise idea of a bank, 
 is, a deposite of coin or other property, as a fund for circulating a credit upon 
 it, which is to answer the purpose of money. That such an arrangement 
 would be equivalent to the establishment of a bank, would become obvious, if 
 the place where the fund to be set apart was kept, should be made a recepta- 
 cle of the moneys of all other persons who should incline to deposite them 
 there for safe keeping; and would become still more so, if the officers, charg- 
 ed with the direction of the fund, were authorized to make discounts at the 
 usual rate of interest, upon good security. To deny the power of the Govern- 
 ment to add this ingredient to the plan, would be to renne away all govern- 
 ment. 
 
 A further process will still more clearly illustrate the point. Suppose, when 
 the species of bank which has been described, was about to be instituted, it 
 were to be]urged, that, in order to secure to it a due degree of confidence, the 
 fund ougjit not only to be set apart and appropriated generally, but ought to 
 be specifically vested in the officers who were to have the direction of it, and 
 in their successors in office, to the end that it might acquire the character of 
 private property, incapable of being resumed without a violation of the sanc- 
 tion by which the rights of property are protected, and occasioning more se- 
 rious and general alarm, the apprehension of which might operate as a check 
 upon the Government. Such a proposition might be opposed by arguments 
 against the expediency of it, or the solidity of the reason assigned for it; but it 
 is not conceivable what could be urged against its constitutionality. 
 
CHARTER OF 1791. 107 
 
 And yet such a disposition of the thing would amount to the erection of a 
 corporation; for the true definition of a corporation seems to be this: it is a 
 legal person, or a person created by act of law; consisting of one or more na- 
 tural persons, authorized to hold property, or a franchise in succession, m a 
 legal, as contradistinguished from a natural, capacity. 
 
 Let the illustration proceed a step further. Suppose a bank, of the nature 
 which has been described, without or with incorporation, had been instituted, 
 and that experience had evinced, as it probably would, that, being wholly 
 under a public direction, it possessed ndt the consequence requisite to the 
 credit of its bills. Suppose, a|so, that, by some of those adverse conjunctures 
 which occasionally attend nations, there had been a very great drain of the 
 specie of the country, so as not only to cause general distress, for want of an 
 adequate medium of circulation, but to produce, in consequence of that cir- 
 cumstance, considerable defalcations in the public revenues. Suppose, also, 
 that there was no bank instituted in any State. In such a posture of things 
 would it not be most manifest, that the incorporation of a bank like that pro- 
 posed by the bill, would be a measure immediately relative to the effectual 
 collection of the taxe.-, and completely within the province of a sovereign 
 power of providing, by all laws necessary and proper, for that collection? 
 
 It it be said, that such a state of things would render that necessary, and, 
 therefore, constitutional, which is not so now; the answer to this (and a solid 
 one it doubtless is) must still be, that which has been already stated. Circum- 
 stances may affect the expediency of the measure, but can neither add to nor 
 diminish its constitutionality. 
 
 A bank has a direct relation to the power of borrowing money, because it is 
 an usual, and, in sudden emergencies, an essential instrument, in the obtaining 
 of loans to Government. 
 
 A nation is threatened with a war; large sums are wanted on a sudden to 
 make the requisite preparations: tixes are laid for the purpose; but it requires 
 time to obtain the benefit of them; anticipation is indispensable. If there be 
 a bank, the supply can at once be had; if there be none, loans from individu- 
 als must be sought. The progress of these is often too slow for the exigency: 
 in some situations they are not practicable at all. Frequently when they are, 
 it is of great consequence to be able to anticipate the product of them by 
 advances from a bank. 
 
 The essentiality of such an institution, as an instrument of loans, is exem- 
 plified at this very moment. An Indian expedition is to be prosecuted. The 
 only fund out of which the money can arise consistently with the public 
 engagements, is a tax, which only begins to be collected in July next. The 
 preparations, however, are instantly to be made. Ti.e money must, therefore, 
 be borrowed; and of whom could it be borrowed, if there were no public 
 banks? 
 
 It happens that there are institutions of this kind; but if there were none, 
 it would be indispensable to create one. 
 
 Let it then be supposed, that the necessity existed, (as but for a casualty 
 would be the case,) that proposals were made for obtaining a loan; that a 
 number of individuals came forward and said, we are willing to accommodate 
 the Government with this money; with what we have in hand, and the credit 
 we can raise upon it, vye doubt not of being able to furnish the sum required. 
 But, in order to do this, it is indispensable that we should be incoporated as a 
 bank. This is essential towards putting it in our power to do what is desired, 
 and we are obliged on that account to make it the consideration or condition 
 of the loan. 
 
 Can it be believed that a compliance with this proposition would be uncon- 
 
 , 
 
 fined to the mere stipulation of a franchise. If it may, (and it is not perceiv- 
 ed why it may not,) then the grant of a corporate capacity may be stipulated 
 as a consideration of the loan. There seems to be nothing unfit, or foreign 
 troin the nature of the thing, in giving individuality^uc-ft^ewgoraie capacity, 
 
 ' 
 
108 BANK OF THE UNITED STATES. 
 
 to a number of persons who are willing to lend a sum of money to the Govern- 
 ment, the better to enable them to do it, and make them an ordinary instru- 
 ment of loans in future emergencies of state. 
 
 But the more general view of the subject is still more satisfactory. The 
 legislative power of borrowing money, and of making all laws necessary and 
 proper for carrying into execution that power, seems obviously competent to 
 the appointment ot the organ through which the abilities and wills of individ- 
 uals may be most efficaciously exerted, for the accommodation of the Govern- 
 ment, by loans. 
 
 The Attorney General opposes to this reasoning the following observation: 
 Borrowing money presupposes the accumulation of a fund to be lent, and is 
 secondary to the creation of an ability to lend. This is plausible in theory, but 
 it is not true in fact. In a great number of cases, a previous accumulation of 
 a fund eciual to the whole sum required, does not exist, and nothing more can 
 be actually presupposed, than that there exist resources, which, put into ac- 
 tivity to the greatest advantage, by the nature of the operation with the Go- 
 vernment, will be equal to the effect desired to be produced. All the provi- 
 sions and operations of Government, must be presumed to contemplate things 
 as^they really are. 
 
 The institution of a bank has, also, a natural relation to the regulation of 
 trade between the States, in so far as it is conducive to the creation of a con- 
 venient medium of exchange between them, and to the keeping up a full cir- 
 culation, by preventing the frequent displacement of the metals in reciprocal 
 remittances. Money is the very hinge on which commerce turns. And. this 
 does not mean, merely gold and silver; many other things have served the pur- 
 pose, with different degrees of utility. Paper has been extensively employed. 
 
 It cannot, therefore, be admitted, with the Attorney General, that the re- 
 gulation of trade between the States, as it concerns the medium of circula- 
 tion and exchange, ought to be considered as confined to coin. It is even 
 supposeable that the whole, or the greatest part of the coin of the country, 
 might be carried out of it. 
 
 The Secretary of State objects to the relation here insisted upon, by the fol- 
 lowing mode of reasoning: To erect a bank, says he, and to regulate com- 
 merce, are very different acts. He who erects a bank, creates a subject of 
 commerce. So does he who raises a bushel of wheat, or digs a dollar out of 
 the mines; yet, neither of these persons regulates commerce thereby. To 
 make a thing which may be bought and sold, is not to prescribe regulations 
 for buying and selling. This is making the regulation of commerce to con- 
 sist in prescribing rules for buying and selling. 
 
 This, indeed, is a species of regulation of trade; but it is one which falls more 
 aptly within the province of the local jurisdictions, than within that of the 
 General Government, whose care they must have presumed to have been in- 
 tended to be directed to those general political arrangements concerning trade, 
 on which its aggregate interests depend, rather than to the details ot buying 
 and selling. 
 
 Accordingly, such only are the regulations to be found in the laws of the 
 United States, whose objects are to give encouragement to the enterprise of 
 our own merchants, and to advance our navigation and manufactures. 
 
 And it is in reference to these general relations of commerce, that an esta- 
 blishment which furnishes facilities to circulation, and a convenient medium 
 of exchange and alienation, is to be regarded as a regulation of trade- 
 
 The Secretary of State further urges, that, if this was a regulation of com- 
 merce, it would be void, as extending as much to the internal part of every 
 State, as to its external. But what regulation of commerce does not extend 
 to the internal commerce of every State ? What are all the duties upon im- 
 ported articles, amounting, in some cases, to prohibitions, but so many boun- 
 ties upon domestic manufactures, affecting the interest of different classes of 
 citizens, in different ways ? What are all the provisions in the coasting act, 
 which relate to the trade between district and district, of the same State ? In 
 short, what regulation of trade between the States, but must affect the inter- 
 
CHARTER OF 1791. 
 
 nal trade of each State ? What can operate upon the whole, but must extend 
 to every part ? 
 
 The relation of a bank to the execution of the powers that concern the com- 
 mon defence, has been anticipated. It has been noted, that, at this very mo- 
 ment, the aid of such an institution is essential to the measure to be pursued 
 for the protection of our frontiers. 
 
 It now remains to show, that the incorporation of a bank, is within the ope- 
 ration of the provision \yhich authorizes Congress to make all needful rules 
 and regulations concerning the property of the United States. But, it is pre- 
 viously necessary to advert to a distinction which has been taken up by the 
 Attorney General. 
 
 He admits, that the word property, may signify personal property, however 
 acquired, and yet asserts that it cannot signify money arising from the sources 
 of revenue pointed out in the constitution, " because," says he, " the dis- 
 posal and regulation of money, is the final cause for raising it by taxes." 
 
 But it would be more accurate to say, that the object to which money is in- 
 tended to be applied, is the final cause for raising it, than that the disposal 
 and regulation of it, is such. The support of a government; the support of 
 troops for the common defence; the payment of the public debt, are the true 
 final causes for raising money. The disposition and regulation of it, when 
 raised, are the steps by which it is applied to the ends for which it was raised, 
 not the ends themselves. Hence, therefore, the money to be raised by taxes, 
 as well as any other personal property, must be supposed to come within the 
 meaning, as they certainly do within the letter, of authority to make all need- 
 ful rules and regulations concerning the property of the United States. 
 
 A case will make this plainer. Suppose the public debt discharged, and 
 the funds, now pledged for it, liberatea; in some instances it would oe found 
 expedient to repeal the taxes; in others, the repeal might injure our own in- 
 dustry, our agriculture, and manufactures. In these cases, they would, of 
 course, be retained. Here then, would be moneys arising from the authorized 
 sources of revenue, which would not fall within the rule by which the Attor- 
 ney General endeavors to except them from other personal property, and 
 from the operation of the clause in question. 
 
 The moneys being in the coffers of Government, what is to hinder such a 
 disposition to be made of them as is contemplated in the bill; or what an in- 
 corporation of the parties concerned, under the clause which has been cited? 
 
 It is admitted, that, with regard to the \Vestern territory, they give a pow- 
 er to erect a corporation; that is ? to constitute a government. And by what 
 rule of construction can it be maintained, that the same words, in a constitu- 
 tion of government, will not have the same effect, when applied to one spe- 
 cies of property, as to another, as far as the subject is capable of it r Or, that 
 a legislative power, to make all needful rules and regulations; or to pass all 
 laws necessary and proper, concerning the public property, which is admitted 
 to authorize an incorporation in one case, will not authorize it in another ? 
 Will justify the institution of a government over the Western territory, and 
 will not justify the incorporation of a bank for the more useful management 
 of the m9ney of the nation ? If it will do the last, as well as the first, then, 
 under this provision alone, the bill is constitutional, because it contemplates 
 that the United States shall be joint proprietors of the. stock of the bank. 
 
 There is an observation of the Secretary of State, to this effect, which may 
 require notice in this place: Congress, says he, are not to lay taxes, ad libi- 
 tum, for any purpose they please, but only to pay the debts, or provide for (he 
 welfare of the Union. Certainly no inference can be drawn from this, against 
 the power of applying their money for the institution of a bank. It is true, that 
 they cannot, without breach of trust, lay taxes for any other purpose tha^n the 
 general welfare; but, so neither can any other government. The welfare of 
 the community is the only legitimate end for which money can be raised on the 
 community. Congress can be considered as only under one restriction, which 
 does not apply to other governments. They cannot rightfully apply the mo- 
 ney they raise to any purpose merely or purely local- But, with this excep- 
 
BANK OF THE UNITED STATES. 
 
 tion, they have as large a discretion, in relation to the application of money, 
 as any legislature whatever. 
 
 The constitutional test of a right application, must always be whether it 
 be for a purpose of general, or local nature. If the former, there can be no 
 want of constitutional power. The quality of Ihe object, as how far it will 
 really promote, or not, the welfare of the Union, must be matter of conscien- 
 tious discretion; and the arguments for or against a measure, in this light, 
 must be arguments concerning expediency or inexpediency, not constitutional 
 right. Whatever relates to the general order of the finances, to the general in- 
 terests of trade, &c. being general objects, are constitutional ones for the ap- 
 plication of money. 
 
 A bank, then, whose bills are to circulate in all the revenues of the coun- 
 try, is evidently a general object, arid, for that very reason, a constitutional 
 one, as far as regards the appropriation of money to it. Whether it will really 
 be a beneficial one or not, is worthy of careful examination, but is no more a 
 constitutional point, in the particular referred to, than the question whether 
 the Western lands shall be sold for twenty or thirty cents per acre. 
 
 A hope is entertained, that, by this time, it has been made to appear to the 
 satisfaction of the President, that the bank has a natural relation to the power 
 of collecting taxes; to that of regulating trade; to that of providing for the com- 
 mon defence; and, that, as the bill under consideration contemplates the Go- 
 vernment in the light of a joint proprietor of the stock of the bank, it brings 
 the case within the provision of the clause of the constitution which immedi- 
 ately respects the property of the United States. 
 
 Under a conviction that such a relation subsists, the Secretary of the Trea- 
 sury, with all deference, conceives that it will result, as a necessary conse- 
 quence, from the position, that all the specified powers of Government are 
 sovereign, as to the proper objects, that the incorporation of a bank is a con- 
 stitutional measure, and that the objections taken to the bill, in this respect, 
 are ill founded. 
 
 But, from an earnest desire to give the utmost possible satisfaction to the 
 mind of the President, on so delicate and important a subject, the Secretary 
 of the Treasury will ask his indulgence, while he gives some additional illus- 
 trations of cases in which a power of erecting corporations may be exercised, 
 under some of those heads of the specified powers of the Government, which 
 are alleged to include the right of incorporating a bank. 
 
 I. It does not appear susceptible of a doubt, that if Congress had thought 
 proper to provide, in the collection law, that the bonds to be given for the du- 
 ties, should be given to the collector of the district A, or B, as the case might 
 require, to inure to him and his successors in office, in trust for the United 
 States, that it would have been consistent with the constitution to make such 
 an arrangement; and yet, this, it is conceived, would amount to an incorpo- 
 ration. 
 
 II. It is not an unusual expedient of taxation to farm particular branches of 
 revenue, that is, to sell or mortgage the product of them for certain definite 
 sums, leaving the collection to the parties to whom they are mortgaged or sold. 
 There are even examples of this in the United States. Suppose that there was 
 any particular branch of revenue which it was manifestly expedient to place 
 on this footing, and there were a number of persons willing to engage with the 
 Government, upon condition that they should be incorporated, and the funds 
 vested in them, as well for their greater safety, as for the more convenient re- 
 covery and management of the taxes, is it supposeable that there could be any 
 constitutional obstacle to the measure ? It. is presumed that there could be 
 none; it is certainly a mode of collection which it would be in the discretion 
 of the Government to adopt, though the circumstances must be very extraor- 
 dinary that would induce the Secretary to think it expedient. 
 
 III. Suppose a new and unexplored branch of trade should present itself 
 with some foreign country; suppose it was manifest that, to undertake it with 
 advantage, required a union of the capitals of a number of individuals, and that 
 those individuals would not be disposed to embark without an incorporation, 
 
CHARTER OF 1791. 
 
 as well to obviate the consequences of a private partnership, which makes 
 every individual liable, in his whole estate, for the debts of the company, to 
 their utmost extent, as for the more convenient management of the business; 
 what reason can there be to doubt, that the national Government would have 
 a constitutional right to institute and incorporate such a company ? None. 
 
 They possess a general authority to regulate trade with foreign countries. 
 This is a mean which has been practised, to that end, by all the principal com- 
 mercial nations, who have trading companies, to this day, which have subsist- 
 ed for centuries. Why may not the United States constitutionally employ 
 the means usual in other countries, for attaining the ends intrusted to them ? 
 
 A power to make all needful rules and regulations concerning territory, has 
 been construed to mean a power to erect a government. A power to regulate 
 trade, is a power to make all needful rules ami regulations concerning trade. 
 Why may it not, then, include that of erecting a trading company, as well as, 
 in other cases, to erect a government ? 
 
 It is remarkable that the State conventions who had proposed amendments 
 in relation to this point, have, most, if not all of them, expressed themselves 
 nearly thus: Congress shall not grant monopolies, nor erect any company with 
 exclusive advantages of commerce I Thus, at the same time expressing their 
 sense, that the power to erect trading companies, or corporations, was inhe- 
 rent in Congress, and objecting to it no further than as to the grant of exclusive 
 privileges. 
 
 The Secretary entertains all the doubts which prevail concerning the utility 
 of such companies: but he cannot fashion to his own mind a reason to induce 
 a doubt that there is a constitutional authority in the United States to establish 
 them. If such a reason were demanded, none could be given, unless it were 
 this, that Congress cannot erect a corporation; which would be no better than 
 to say they cannot do it, because they cannot do it; first presuming an ina- 
 bility without reason, and then assigning that inability a.s the cause of itself. 
 
 Illustrations of this kind might be multiplied without end. They shall, how- 
 ever, be pursued no further. 
 
 There is a sort of evidence on this point, arising from an aggregate view of 
 the constitution, which is of no inconsiderable weight. The very general 
 power of laying and collecting taxes, and appropriating their proceeds; that 
 of borrowing money indefinitely: that of coin ing money, and regulating foreign 
 coins; that of making all needful rules and regulations respecting the property 
 of the United States. These powers combined, as well as the reason and na- 
 ture of the thing, speak strongly this language: that it is the manifest design 
 and scope of the constitution, to vest in Congress all the powers requisite to 
 the effectual administration of the finances of the United States. As far a 
 concerns this object, there appears to be no parsimony of power. 
 
 To suppose, then, that the Government is precluded from the employment 
 of so usual and so important an instrument for the administration of its finan- 
 ces, as that of a bank, is to suppose what does not coincide with the general 
 tenor and complexion of the constitution, and what is not agreeable to impres- 
 sions that any mere spectator would entertain concerning it. Little less than 
 a prohibiting clause can destroy the strong presumptions which result from the 
 general aspect of the Government. Nothing but demonstration should exclude 
 the idea that the power exists. 
 
 To all questions of this nature, the practice of mankind ought to have great 
 weight against the theories of individuals. 
 
 The fact, for instance, that all the principal commercial nations have made 
 use of trading corporations or companies, for the purpose of external com- 
 merce^ is a satisfactory proof that the establishment of them, is an incident to 
 the regulation of commerce. 
 
 This other fact, that banks are an usual engine in the administration of na- 
 tional finances, and an ordinary, and the most effectual, instrument of loans, 
 and one which, in this country, has been found essential, pleads strongly 
 against the supposition, that a government clothed with most of the important 
 prerogatives of sovereignty, in relation to its revenues, its debt, its credit, its 
 
BANK OF THE UNITED STATES. 
 
 defence, its trade, its intercourse with foreign nations, is forbidden to make 
 use of that instrument as an appendage to its own authority. 
 
 It has been stated, as an auxiliary test of constitutional authority, to try 
 whether it abridges anv pre-existing right of any State or any individual. The 
 proposed measure will stand the most severe examination on this point. Each 
 State may still erect as many banks as it pleases; every individual may still 
 carry on the banking business to any extent he pleases. 
 
 Another criterion may be this; whether the institution or thing has a more 
 direct relation, as to its uses, to the objects of the reserved powers of the State 
 Government, than to those of the powers delegated by the United States? 
 This rule, indeed, is less precise than the former; but it may still serve as 
 some guide. Surely, a bank has more reference to the objects intrusted to the 
 national Government than to those left to the care of the State Government. 
 The common defence is decisive in this comparison. 
 
 It is presumed, that nothing of consequence in the observations of the Se- 
 cretary of State and Attorney General, has been left unnoticed. 
 
 There are, indeed, a variety of observations of the Secretary of State, de- 
 signed to show, that the utilities ascribed to a bank, in relation to the collec- 
 tion of taxes and to trade, could be obtained without it. To analyze which, 
 would prolong the discussion beyond all bounds. It shall be forborne for two 
 reasons: first, because the report concerning the bank, may speak for itself in 
 this respect; and, secondly, because all those observations are grounded on 
 the erroneous idea, that the quantum of necessity or utility is the test of a 
 constitutional exercise of power. 
 
 One or two remarks only shall be made; one is, that he has taken no notice 
 of a very essential advantage to trade in general, which is mentioned in the 
 report as peculiar to the existence of a bank circulation, equal, in the public 
 estimation, to gold and silver. It is this that renders it unnecessary to lock 
 up the money of the country to accumulate for months successively, in order 
 to the periodical payment of interest. The oilier is this: that his arguments 
 to show that treasury orders and bills of exchange, from the course of trade, 
 will prevent any considerable displacement of the metals, are founded on a 
 particular view of the subject. A case will prove this. The sums collected 
 in a State, may be small in comparison with the debt due to it. The balance 
 of its trade, direct and circuitous with the Seat of Government, may be even, 
 or nearly so. Here, then, without bank bills, which, in that State, answer the pur- 
 pose of coin, there must be a displacement of the coin, in proportion to the dif- 
 ference between the sum collected in the State, and that to be paid in it. With 
 bank bills no such displacement would take place; or, as far as it did, it would 
 be gradual and insensible. In many other ways, also, would there be at least 
 a temporary and inconvenient displacement of the coin, even where the course 
 of trade would eventually return it to its proper channels. 
 
 The difference of the two situations, in point of convenience to the treasury, 
 can only be appreciated by one who experiences the embarrassments of mak- 
 ing provision for the payment of the interest on a stock, continually changing 
 place in thirteen different places. 
 
 One thing which has been omitted, just occurs, although it is not very ma- 
 terial to the main argument. The Secretary of State affirms, that the bill 
 only contemplates repayment, not a loan to the Government. But here he is 
 certainly mistaken. It is true, the Government invests in the stock of the 
 bank, a sum equal to that which it receives on loans. But let it be remem- 
 bered, that it does not, therefore, cease to be a proprietor of the stock, which 
 would be the case, if the money received back were in the nature of a pay - 
 nient. It remains a proprietor still, and will share in the profit or loss ot the 
 institution, according as the dividend is more or less than the interest it is to 
 pay on the sum borrowed. Hence that sum is manifestly, and in the strict- 
 est s^nse, a loan. 
 
 ALEXANDER HAMILTON. 
 
 Philadelphia, February 23, 1791. 
 
CHARTER OF 1791. 
 
 WEDNESDAY NOON, 23d February, 1791. 
 
 SIR: I have this moment received your sentiments with respect to the con- 
 stitutionality of the bill " to incorporate the subscribers to the Bank of the 
 United States," 
 
 This bill was presented to me by the the joint committee of Congress, 
 at 12 o'clock on Monday, the 14th instant. To what precise period, by legal 
 interpretation of the constitution, can the President retain it in his possession, 
 before it becomes a law by the lapse of ten days? 
 
 GEO. WASHINGTON. 
 
 To the Secretary of (he Treasury. 
 
 FEBRUARY, 23, 1791. 
 
 SIR: In answer to your note of this morning just delivered to me, 1 give it 
 ;is my opinion, that you have ten days, exclusive of that on which the bill was 
 delivered to you, and Sundays; hence, in the present case, if it is returned 
 on Friday, at any time while Congress are sitting, it will be in time. 
 It might be a question, if returned after their adjournment on Friday. 
 I have the honor to be, with perfect respect, sir, 
 
 Your most obedient servant, 
 
 A. HAMILTON. 
 To the President (if the United Stales. 
 
 PHILADELPHIA, February 24, 1791. 
 
 MR: 1 have just heard from the Senate, that the bill supplementary to that 
 for incorporating the bank went through a second reading, and a question 
 was taken upon it, and only three or four dissentients; among these were Mr. 
 Car rot I and Mr. Monroe. 
 
 It would have been passed this day without doubt, but the opponents in- 
 sisted on the rule of the House, which made it impossible. It will be passed 
 the first thing to-morrow. 
 
 The yeas and nays were taken, in order to please the members. 
 I have the honor to be, 
 
 Most respectfully and affectionately, sir, &c. 
 
 .. A. HAMILTON. 
 
 Fo the President of the United States. 
 
 THURSDAY, February 25, 1791. 
 
 SIR: The bill supplementary to the Bank bill, passed the House of Repre- 
 sentatives yesterday. General Schuyler informs me, that the friends of the 
 bank proposed that it should pass to a second reading immediately, and that 
 rlt^^ST 011 f?P sed ^ and moved that it should be printed that, by a rule 
 ot the House, it was of necessity to comply with Mr. Carroll's objection, a 
 departure requiring unanimous consent. That, accordingly, the bill was 
 deterred till to-day, and in the mean time, ordered to be printed. 
 
 It will, doubtless, pass, if there are not studied delays on the part of the 
 opposers of the bank. 
 
 I have the honor to be, with perfect respect, &c. 
 
 ~, D . . A. HAMILTON. 
 
 The President of the United States. 
 
 15 
 
BANK OF THE UNITED STATES. 
 
 SUPPLEMENTARY BILL. 
 HOUSE OF REPRESENTATIVES, February 9, 1791. 
 
 Ordered, That a committee be appointed to prepare and bring in a bill or 
 bills supplementary to the foregoing act, and that Mr. Smith, of S. C. Miv 
 Williamson, and Mr. Vining, be the said committee. 
 
 On the 10th, Mr. SMITH, from the said committee, presented a bill, which, 
 on the 23d of February, passed the House, and afterwards the Senate, and 
 was approved by the President on the 2d of March, 1791. 
 
 It regulated the time of subscription to the stock of the bank, the amount 
 of specie to be paid, &c. 
 
 [See the act m 1st vol. U. S. Laws, p. 177, Story's edition.] 
 
 SUPPLEMENTS TO THE ACT OF 1791, INCORPORATING THE UNITED 
 
 STATES BANK. 
 
 The first supplementary act upon this subject which was passed, was that 
 of the 2d of March, 1791, heretofore referred to, varying the time of sub- 
 scriptions, and the amount of specie payments, &c. 
 
 On the 27th of June, 1798, an act was passed "to punish frauds committed 
 on the Bank of the United States," by which the forging or uttering of coun- 
 terfeit bills, notes, orders, or checks, by or upon the bank, subjected the 
 offender to imprisonment at hard labor, for a period not less than three, nor 
 more than ten years. [See Laws of U. S. of 1798, chap. 78.] 
 
 By an act passed the 23d of March, 1804, power was given to the Presi- 
 sident and Directors of the Bank, to establish offices of discount and deposite 
 44 in any part of the territories or dependencies of the United States," in the 
 manner and on the terms prescribed by the original act. [See U. S. laws,, 
 1804, chap. 32.] 
 
 An additional act, " to punish frauds committed on the bank," was passed 
 on the 24th of February, 1807. [See chap. 75, in Story 'sedition of U. S. laws* 
 vol. 2d r p. 1048.] 
 
CHAPTER III. 
 
 PROCEEDINGS ON THE MEMORIAL OF THE STOCKHOLDERS OF THE BANK FOR A 
 RENEWAL OF THK CHARTER OF 1791. 
 
 BY the limit fixed in the original act of incorporation, the legal existence 
 of the bank, as a corporate body, was to cease on the 4th of March, 1811. 
 In anticipation of that event, its directors thought it advisable, at an early 
 period, to apply to Congress for a renewal of their powers. The circum- 
 stances connected with its origin, and its relation to the political parties, by 
 whom the Government, at different periods of its existence, had been admin- 
 istered, might have suggested a doubt whether an extension of the charter 
 would be granted. In its enactment, a large majority of Congress had, in- 
 deed, concurred, and it had enjoyed, in the outset ? the entire confidence of 
 the Executive Government of the Union; but a political revolution had been 
 effected, and those who had given it being, were themselves, by the will of 
 the People, divested of a controlling power. Two, among the early opposers 
 of the bank, had successively filled the Executive chair. How far these 
 changes in the aspect and relative condition of parties, affected the destinies 
 of this institution, it is not for the editors to determine; but, doubtless, they 
 were not without their influence. 
 
 The following proceedings and debates, which took place, both in the 
 House and the Senate, on the bill to renew the charter, are of a highly inter- 
 esting and instructive character, and may enable the reader to decide ques- 
 tions upon which the editors will not presume to speculate. 
 
 C Sarimi M ' } HOUSE OF REPRESENTATIVES, March 26, 1808. 
 
 A memorial of the stockholders of the Bank of the United States, praying 
 a renewal of their charter, was presented and read: whereupon, 
 
 A motion was made, by Mr. JOSEPH CLAY, " that it be referred to the Se- 
 cretary of the Treasury, with instruction to him to examine the matter thereof, 
 and report his opinion thereupon to the House." 
 
 Mr. RANDOLPH moved to postpone the consideration of the reference of the 
 memorial, till Monday following, which motion the SPEAKER decided, was 
 not in order. 
 
 A motion was then made by Mr. DAVID R. WILLIAMS, that the memorial 
 be referred to a Committee of the Whole House, which, superseding the mo- 
 tion for a reference to the Secretary of the Treasury, the question was taken 
 thereon, and decided in the affirmative. 
 
 Resolved, That the said memorial be the order of the day for Monday next. 
 
 The subject, however, was not further acted on in this House during the 
 session. 
 
 IN SENATE, April 20, 1808. 
 
 Mr. GREGG presented the memorial of the stockholders of the Bank of the 
 United States, praying a renewal of their charter, for reasons stated at large 
 in their memorial, which was read. 
 
 Ordered* That it be referred to the Secretary of the Treasury, to consider 
 and report thereon at the next session of Congress. 
 
 MAHCH 8,1800. 
 
 The President of the Senate communicated the report of the Secretary of 
 the Treasury, on the memorial of the stockholders of the Bank of the United 
 States, referred to him on the 20th of April last, which is as follows: 
 
116 BANK OF THE UNITED STATES. 
 
 Report of the Secretary of the Treasury on the subject of a National Bank, 
 made to the Senate, March 2, 1809. 
 
 The Secretary of the Treasury, to whom was referred the memorial of the 
 stockholders of the Bank of the United States, praying for a renewal of 
 their charter, which will expire on the 4th day of March, 1811, respectfully 
 submits the following report: 
 
 The Bank of the United States was incorporated by act of March 2d, 
 1791, with a capital of ten millions of dollars, divided into 25,000 shares, of 400 
 dollars each. Two millions of dollars were subscribed by the United States, 
 and paid in ten equal annual instalments. Of the eight millions of dollars 
 subscribed by individuals, two millions werepaid in specie, and six millions 
 in six per cent, stock of the United States. Two thousand four hundred and 
 ninety-three of the shares belonging to Government, were sold in the years 
 1796 and 1797, at an advance of 25 per cent.; two hundred and eighty-seven 
 were sold in the year 1797, at an advance of 20 per cent.; and the other two 
 thousand two hundred and twenty shares, in the year 1802, at an advance of 
 45 per cent.; making, together, exclusively of the dividends, a profit of 
 671,860 dollars to the United States. The greater part of the six per cent, 
 stock originally paid by the stockholders, has since been sold by the bank: 
 a portion has been redeemed by Government, by the operation of the annual 
 reimbursement, and the bank retains at present only a sum of $2,231,598 in 
 six per cent, stock. 
 
 About eighteen thousand shares of the bank stock, are held by persons 
 residing abroad, who are, by the charter, excluded from the right of voting. 
 The stockholders resident within the United States, and who have the exclu- 
 sive control over the institution, hold only seven thousand shares, or little 
 more than one-fourth part of its capital. They appoint, annually, twenty-five 
 directors of the bank itself, which is established at Philadelphia; and those 
 directors have the entire management of the discounts and other transactions 
 of the institution in that city, and the general superintendence and appoint- 
 ment of the directors and cashiers of the offices of discount and deposite, esta- 
 blished in other places. There are at present eight of those offices, viz: at 
 Boston, New York, Baltimore, Norfolk, Charleston, Savannah, the City of 
 Washington, and New Orleans. The two last were established at the request 
 of the Secretary of the Treasury. 
 
 The profits of a bank arise from the interest received on the loans made 
 either to Government or to individuals; and they exceed six per cent, or the 
 rate of interest at which the loans are made, because every bank lends not 
 only the whole of its capital, but also a portion of the moneys deposited for 
 safe keeping in its vaults, either by Government or by individuals. For every 
 sum of money thus deposited, the party making that deposite, either receives 
 the amount in bank notes, or obtains a credit on the books of the bank. In 
 either case, he has the same right at any time to withdraw his deposite; in the 
 first case, on presentation and surrender of the bank notes; in the other case, 
 by drawing on the bank for the amount. Bank notes and credits on the 
 books of the bank, arise, therefore, equally from deposites, although the credits 
 alone are, in common parlance, called deposites; and the aggregate of those 
 credits, and of the bank notes issued, constitutes the circulating medium 
 substituted by the banking operations to money; for payments from one indi- 
 vidual to another are equally made by drafts on the bank, or by the delivery 
 of bank notes. Experience has taught the directors what portion of the mo- 
 ney thus deposited, they may lend; or, in other words, how far they may, with 
 safety, extend their discounts beyond the capital of the bank, and what amount 
 of specie it is necessary they should keep in their vaults. The profits, and, 
 therefore, the dividends of a bank, will increase in proportion as the directors 
 will increase loans of the moneys deposited, and suffer the amount of specie 
 on hand to diminish. Moderate dividends, when not produced by some par- 
 ticular cause, which checks the circulation of bank paper, are the best evi- 
 dence of the safety ol the institution, and of the wisdom of its direction. 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 The annexed table of all the dividends made by the Bank of the United 
 
 extending its discounts. 
 
 From what has been premised, it appears that the property of a bank in full 
 operation, consists of three general items, viz: 1st, outstanding debts, con- 
 sisting principally of the notes payable at sixty days, which have been dis- 
 counted at the bank: 2dly, specie in the vaults: 3dly, buildings necessary for 
 the institution. On the other hand, the bank owes, 1st, to the stockholders, 
 the amount of the capital stock originally subscribed, payable only in case of 
 the dissolution of the institution: 2dly, to Government or individuals, the 
 whole amount of moneys deposited, payable on demand, and including both 
 the credits on the bankbooks, commonly called deposites, and the bank notes 
 in circulation. The account is balanced by the amount of undivided profits 
 and accruing discounts, which constitute the fund for defraying current ex- 
 penses, for paying subsequent dividends, and for covering contingent losses. 
 
 The following statement of the situation of the Bank of the United States, 
 including its branches, exhibits the true amount of public stock which is still 
 held by the institution, of the cost of its buildings and lots of ground, and of 
 the undivided surplus or contingent fund subsequent to the dividend made in 
 January last. But the amount of loans to individuals or discounts, of specie 
 in the vaults, and of moneys deposited, including both the credits on the bank 
 books, commonly called deposites, and the bank notes in circulation, is taken 
 on a medium; and, so far as relates, on the credit side of the account, to specie 
 on hand, and, on the debit >ide, to deposites, is several millions of dollars less 
 than it happens to be at this moment; both having been swelled much beyond 
 the average by the embargo, and by the unusually large balance in the trea- 
 sury, which is principally deposited in the bank. Some minor items, arising 
 from accidental circumstances, are omitted for the sake of perspicuity. 
 
 CR. 
 
 I. Debts due to the bank, viz: 
 
 1 . Six per cent, stock of the United States, being the 
 residue of that part of the original subscription 
 paid in public stocks, which is still held by the 
 
 bank, - $2,230,000 
 
 2. Loans to individuals, consisting chiefly of dis- 
 counted notes, payable at sixty days, and, in some 
 instances, of bonds and mortgages" taken, in order 
 
 to secure doubtful debts, - 15,000,000 
 
 3. Due by banks incorporated by the States, - 800,000 
 
 18,030,000 
 
 II. Specie in the vaults, 5,000,000 
 III Cost of lots of ground, and buildings erected, - 480,000 
 
 Total Cr. - _$23,5l(),000 
 
 DR. 
 
 I. Capital stock of the bank, payable to the stockhold- 
 
 ers whenever the institution may be dissolved, $10,000,000 
 
 II. Moneys deposited, viz: 
 
 1. Credits on the bank books, commonly 
 called deposites, including the deposites 
 both by Government and by indivi- 
 duals, - - 8,500,000 
 
 2. Bank notes in circulation, - - 4,500,000 
 
 13,000,000 
 
 Total Dr. - $23,000,000 
 
BANK OF THE UNITED STATES. 
 
 Balance, being the amount of undivided profits, commonly called 
 the "contingent fund," and applicable to cover losses which 
 may arise from bad debts or other contingencies, and to extra 
 dividends, - $510,000 
 
 It sufficiently appears from that general view, that the affairs of the Bank 
 of the United States, considered as a moneyed institution, have been wisely 
 and skilfully managed. 
 
 The advantages derived by Government from the bank, are nearly of the 
 same nature with those obtained by individuals, who transact business witli 
 similar institutions, and may be reduced to the following heads: 
 
 1. Safe keeping of the public moneys. This applies not only to moneys al- 
 ready in the treasury, but also to those in the hands of theprincipal collectors, of 
 the commissioners of the loans, and of several other officers, and affords one 
 of the best securities against delinquencies. 
 
 2. Transmission of public moneys. As the collections will always, in 
 various quarters of the extensive territory of the Union, either exceed or fall 
 short of the expenditures in the same places, a perpetual transmission of mo- 
 ney, or purchase of remittances at the risk and expense of the United States, 
 would become necessary, in order to meet those demands; but this is done by 
 the bank at its own risk and expense, for every place where one of its branches 
 is established, which embraces all payments of any importance. 
 
 3. Collection of the revenue. The punctuality of payments introduced by 
 the banking system, and the facilities afforded by the bank to the importers 
 indebted for revenue bonds, are amongst the causes which have enabled the 
 United States to collect with so great facility, and with so few losses, the 
 large revenue derived from the impost. 
 
 4. Loans. Although the prosperity of past years has'enabled Government, 
 during the present administration, to meet all the public demands, without 
 recurring to loans, the bank had, heretofore, been eminently useful in making 
 the advances, which, under different circumstances, were necessary. There 
 was a time when, exclusively of the six per cent, stock held by the institution 
 as part of the original subscription, the loans obtained by Government from 
 the bank, amounted to 6,200,000 dollars. And a similar disposition has been 
 repeatedly evinced, whenever the aspect of public affairs has rendered it proper 
 to ascertain whether new loans mignt, if wanted, be obtained. 
 
 The numerous banks now established, under the authority of the several 
 States, might, it is true, afford considerable assistance to Government in its 
 fiscal operations. There is none, however, which could effect the transmis- 
 sion of public moneys with the same facility, and to the same extent, as the 
 Bank of the United States is enabled to do, through its several branches. 
 The superior capital of that institution offers, also, a greater security against 
 any possible losses, and greater resources in relation to loans. Nor is it eligi- 
 ble, that the General Government should, in respect to its own operations, 
 be entirely dependent on institutions over which it has no control whatever. 
 A national bank, deriving its charter from the National Legislature, will, 
 at all times, and under every emergency, feel stronger inducements, both from 
 interest and from a sense ot duty, to afford to the Union every assistance 
 within its power. 
 
 The strongest objection against the renewal ot the charter seems to arise 
 from the great portion of the'bank stock held by foreigners not on account of 
 any influence it gives them over the institution, since they have no vote but 
 of the high rate of interest payable by America to foreign countries, on the 
 
 a year, must be annually remitted in the same manner. The renewal of the 
 charter will, in that respect, operate, in a national point of view, as a foreign 
 loan, bearing an interest of 8 per cent, a year. 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 That inconvenience might, perhaps, be removed, by a. modification in the 
 charter, providing tor the repayment of that p9rtion of the principal by a new 
 subscription to the same amount, in favor of citizens,- but it does not, at all 
 events, appear sufficient to outweigh the manifest public advantages derived 
 from the renewal of a charter. 
 
 The conditions in favor of the public, on which this should be granted, are 
 the next subject of consideration. 
 
 The nett profit annually derived by the stockholders, from a renewal of the 
 charter, is equal to the difference between the annual dividends and the mar- 
 ket rate of interest. Supposing this to continue at six per cent, during the 
 period granted by the extension of the charter, and the dividends to be on an 
 average at the rate of 85 per cent., that profit will be 2 per cent, a year. 
 If the charter be extended twenty years, the value of the privilege will be 
 equal to an annuity of 2.1 per cent, on the capital, that is to say, of 250,000 dol- 
 lars, for twenty years; and such annuity being payable semi-annually, is 
 worth almost 2,890,000 dollars. This, however, would be much more than 
 any bank would give for a charter, as it would leave it nothing but the right 
 of dividing at the rate of six per cent, a year, which the stockholders have 
 without a charter. It is believed, that they would not be willing to give even ' 
 half that sum for the extension: and that about 1,250,000 dollars may be con- 
 sidered as the maximum, which could be obtained, if it was thought eligible 
 to sell the renewal of the charter for a fixed sum of money. 
 
 It is, however, presumed, that the decision on the conditions, which may 
 be annexed to an extension of the charter, will be directed by considerations 
 of a much greater importance than the payment of such sum into ihe treasury. 
 
 The object will, undoubtedly, be to give to the institution all the public 
 utility of which it is susceptible, and to derive from it permanent and solid 
 advantages, rather than mere temporary aid. Under these impressions, the 
 following suggestions are respectfully submitted: 
 
 I. That the bank should pay interest to the United States, on the public 
 deposites, whenever they shall exceed a certain sum, which'might perhaps 
 be fixed at about three millions of dollars. 
 
 II. That the bank should be bound, whenever required, to lend to the United 
 States a sum not exceeding three-fifths of its capital, at a rate of interest 
 not exceeding six per cent.; the amount of such loan or loans to be paid 
 by the bank in instalments, not exceeding a certain sum, monthly, and 
 to be reimbursed at the pleasure of Government. 
 
 III. That the capital stock of the bank should be increased to thirty millions 
 of dollars, in the following manner, viz: 
 
 1. Five millions of dollars to be subscribed by citizens of the United States, 
 under such regulations as would make an equitable apportionment amongst 
 the several States and Territories. 
 
 2. Fifteen millions to be subscribed by such States as may desire it, and 
 under such equitable apportionment amongst the several States as may be 
 provided by law; and a branch to be established in each subscribing State, if 
 applied for by the State. 
 
 3. The payments, either by individuals or States, to be either in specie or 
 in public stock 9f the United States, at such rates as may be provided by law. 
 
 4. The subscribing States to pay their subscription in ten annual instalments, 
 or sooner it it suits their convenience, but to receive dividends in proportion 
 only to the amount of subscription actually paid: and their shares of bank 
 stock not to be transferable. 
 
 IV. That some share should be given in the direction to the General and 
 State Governments, the General Government appointing a few directors 
 in the general direction, and the Government of each subscribing State 
 appointing a few directors in the direction of the branch established in 
 such State. 
 
BANK OF THE UNITED STATES. 
 
 The result of that plan would be, 1st., that the United States, receiving an 
 interest on the public deposites, might, without inconvenience, accumulate 
 during years of peace and prosperity, a treasure sufficient to meet periods of 
 war and calamity, and thereby avoid the necessity of adding, by increased 
 taxes, to the distresses of such periods. Secondly, that they might rely on a 
 loan of eighteen millions of dollars, on any sudden emergency. Thirdly, 
 that the payment of the greater part of the proposed increase of capital, being 
 made in ten annual instalments, that increase would be gradual, and not more 
 rapid than may be required by the progressive state of the country. Fourth- 
 ly, that the bank itself would form an additional bond of common interest and 
 union amongst the several States. 
 
 All which is respectfully submitted. 
 
 ALBERT GALLAT1N. 
 TREASURY DEPARTMENT, March 2rf, 1809. 
 
 Dividends on United States' Bank Stock. 
 
 No. 
 
 
 Rate per 
 
 No. 
 
 
 Rate per 
 
 
 
 cent. 
 
 
 
 cent. 
 
 1 
 
 July, 1792 
 
 4 
 
 18 
 
 January, 1801 
 
 6 
 
 2 
 
 January, 1793 
 
 4 
 
 19 
 
 July, 
 
 4 
 
 3 
 
 July, 
 
 3| 
 
 20 
 
 January, 1802 
 
 4 
 
 4 
 
 January, 1794 
 
 3 7 8 
 
 21 
 
 July, 
 
 4$ 
 
 5 
 
 July, 
 
 4 
 
 22 
 
 January, 1803 
 
 4 
 
 6 
 
 January, 1795 
 
 4 
 
 23 
 
 July, 
 
 4 
 
 7 
 
 July, 
 
 4 
 
 24 
 
 January, 1804 
 
 4.1 
 
 8 
 
 January, 1796 
 
 4 
 
 25 
 
 July, 
 
 4 
 
 9 
 
 July, 
 
 4 
 
 26 
 
 January, 1805 
 
 4 
 
 10 
 
 January, 1797 
 
 4 
 
 27 
 
 July, 
 
 4 
 
 11 
 
 July, 
 
 4 
 
 28 
 
 January, 1806 
 
 4 
 
 12 
 
 January, 1798 
 
 5 
 
 29 
 
 July, 
 
 4 
 
 13 
 
 July, 
 
 4 
 
 30 
 
 January, 1807 
 
 6 
 
 14 
 
 January, 1799 
 
 4 
 
 31 
 
 July, 
 
 4 
 
 15 
 
 July, 
 
 4 
 
 32 
 
 January, 1808 
 
 4 
 
 16 
 
 January, 1800 
 
 4 
 
 33 
 
 July, 
 
 4 
 
 17 
 
 July, * " 
 
 4 
 
 34 
 
 January, 1809 
 
 4 
 
 1st Session 
 
 HOUSE OF REPRESENTATIVES, December 4, 1809. 
 
 Mr. NICHOLAS moved the following resolution: 
 
 Resolved^ That provision be made by law for a general national establish- 
 ment of banks throughout the United States, and that the profits arising from 
 the sam6, together with such surplusses of revenue as may accrue, be appro- 
 priated for the " general welfare," in the construction of public roads and 
 canals, and .the establishment of seminaries for education, throughout the 
 United States. 
 
 The resolution was read, and ordered to lie on the the table. 
 
 JANUARY 29, 1810. 
 On motion of Mr. SEYBERT, 
 
 Ordered^ That the memorial of the stockholders of the Bank of the United 
 States, presented on the 26th March, 1808, be referred to Mr. Montgomery, 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 Mr. Dana, Mr. Bassett, Mr. Seaver, Mr. Seybert, Mr, Gold, and Mr. Tay- 
 lor, to consider and report thereon to the House. 
 
 FEBRUARY 6, 1810. 
 
 The House proceeded to consider the resolution of Mr. NICHOLSON,* of the 
 4th December last, for the establishment of banks, arid the application ot their 
 profits; whereupon, a division of the question on the said resolution was call- 
 ed for by Mr. SAWYER, to the word 4fc States," inclusive, in the second line 
 of the resolution. 
 
 A motion was made by Mr. Ross, that the first member contained within 
 the same, to the word " States," inclusive, in the second line, be referred to 
 a Committee of the Whole House; 
 
 Which was determined in the negative. 
 
 A motion was then made by Mr. SAWYER, that the said first member be re- 
 ferred to a select committee; 
 
 Which was also determined in the negative. 
 
 FEBRUARY 19, 1810. 
 
 Mr. MONTGOMERY, from the committee appointed on the 29th ultimo, oi\ 
 the memorial of the stockholders of the Bank of the United States, made the 
 following report thereon; which was read and referred to a Committee of the 
 Whole House to -morrow. 
 
 REPORT OF THE COMMITTEE, 
 
 The committee to whom was referred the petition of the stockholders of the 
 Bank of the United States, beg leave to submit the following report: 
 
 That, in proceeding to the consideration of the said petition, your com- 
 inittee instructed their chairman to address a letter to the Secretary of the 
 Treasury, requesting him to furnish such information or observations as he 
 might think proper, in relation to the subject matter thereof, as connected 
 with the financial and commercial interests of the United States. In reply 
 to which, the Secretary, by his letter to the chairman, referred your commit- 
 tee to his former report on the said subject, made to the Senate of the United 
 States, in obedience to the order of that House. 
 
 Your committee have been attended by agents of the petitioners, who, in 
 addition to the matters contained in the petition, have suggested to your com- 
 mittee, that the object of the petitioners was to obtain the renewal of the char- 
 ter in its present torm; that, for this renewal, the bank was willing to make 
 compensation, either by loans, at a rate of interest, or by a sum of money to 
 be agreed upon, or by an increase of the capital stock, by a number of shares 
 to be taken and subscribed for by the United States, to an amount adequate 
 to the compensation to be agreed upon for such renewal. 
 
 These agents also suggested that they were fully authorized and empow- 
 ered to offer and concluoe the terms specifically connected with these propo- 
 sitions. 
 
 Your committee, not feeling themselves authorized to enter into such terms, 
 and judging that the extent of those propositions would better apply to the 
 details of a bill, than to the adoption of a principle to be first settled by the 
 House, have, therefore, forborne to inquire into the extent of the propositions, 
 and, without expressing an approbation or rejection of those offers, or giving 
 an opinion as to the plan and reasoning of the Secretary of the Treasury, your 
 committee, in order that the opinion of the House on this great national ques- 
 tion, may be declared, previous to entering into the details connected with 
 the subject, recommend the following resolution: 
 
 * In the Journal of the House for the day on which this resolution was first offered, 
 it is attributed to Mr. Nicholas, who was a member from Virginia; it is here imputed 
 to Mr. Nicholson, who was from New York, 
 16 
 
122 BANK OF THE UNITED STATES. 
 
 Resolved^ That it is proper to make provision for continuing the establish- 
 ment of the Bank of the United States, with offices of discount and deposite, 
 under the regulations necessary for the beneficial administration of the na- 
 tional finances, during such time and an such conditions, as may be defined 
 by law, 
 
 FEBRUARY 22, 1810. 
 Mr. LOVE moved the following resolution: 
 
 Resolved, That it is expedient to inquire into the propriety of establishing 
 a national bank. 
 
 The said resolution being read, was referred to the Committee of the Whole 
 House, to whom is committed the report of a select committee on the memo- 
 rial of the stockholders of the Bank of the United States. 
 
 MARCH 22, 1810. 
 On motion of Mr. LOVE, 
 
 Ordered, That the Committee of the Whole House to which is committed 
 a resolution submitted by him, on the 22d ultimo, for the establishment of a 
 national bank, be discharged from the further consideration thereof, and that 
 the same be referred to Mr. Love, Mr. Montgomery, Mr. Smilie, Mr. Quin- 
 ey, Mr. Desha, Mr. Root, and Mr. Marion. 
 
 MARCH 29, 1810. 
 
 On motion of Mr. TAYLOR, 
 
 Ordered, That the Committee of the Whole House to which is committed 
 the report of a select committee, on the memorial of the stockholders of the 
 Bank of the United States, be discharged from the consideration thereof, and 
 that the said report be referred to Mr. Taylor, Mr. Mumford,Mr. Pitkin,Mr> 
 J. Porter, Mr. Gray, Mr. Howard, and Mr. Cook, with instruction to re- 
 port by bill. 
 
 APRIL 2, 1810. 
 
 Mr. LOVE, from the committee appointed OK the 22d ultimo, presented a 
 bill to establish a national bank, which was read the first time. 
 
 On motion, the said bill was read the second time, and committed to Ccom- 
 mittee of the Whole House on Thursday next. 
 
 Mr. LOVE also made a written report in relation to the principles of the said 
 bill, which was read, as follows: 
 
 The committee to whom was referred on the 22d of March last, a resolution re- 
 lative to the establishment of a national bank, beg leave further to report: 
 
 That they have had the subject thereof under consideration, and in every 
 view they have been able to take of it, perceive great difficulties to occur: 
 nor is a majority of them by any means satisfied, that the bill they have agreed 
 should be reported to the House, presents the best mode for the establish- 
 ment of a national bank. They have been induced, however, to direct their 
 chairman to report the same for the consideration of the House, without there- 
 by intending to pledge their opinions in support of it, in preference to any 
 other system or project which may be devised, on this very important subject. 
 
 The said bill is as follows: 
 
 A BILL TO ESTABLISH A NATIONAL BANK. 
 
 Be it enacted by the Senate and House of Representatives of the United 
 States of America in Congress assembled, That a bank shall be established 
 in the city of Washington, in the District of Columbia, with branches thereof 
 in the territories of the United States, and in the States, respectively, on 
 application of the Legislatures thereof, in manner hereinafter mentioned, the 
 capital of which shall not exceed fifteen millions of dollars, to be divided into 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 shares of four hundred dollars each; and that, for the purpose of constituting 
 three millions of the capital stock of said bank, the Secretary of the Treasury 
 
 i II i , i i., , i _ I i.: H _ .1* _ j. l_ 
 
 any less sum, to bear an interest of six per centum per annum, from the time 
 of delivery to the purchasers; which debt shall be reimbursable at the plea- 
 sure of the United States, at any time after ten years, and not sooner; no 
 certificate for which shall be issued for a less sum than four hundred dollars, 
 and when for a larger sum, shall be to an amount, the principal of which shall 
 be capable of simple divisions into sums of four hundred dollars; the same 
 shall be receivable in subscriptions to the capital stock of the national bank 
 aforesaid; and, for every four hundred dollars of the principal thereof, the 
 subscriber, being a citizen of the United States or territories, shall be entitled 
 to one share of the capital stock of the said bank, and may subscribe accord- 
 ingly, in books to be opened for that purpose in the city of Washington, 
 aforesaid, on the first day of January, in the year one thousand eight hundred 
 and eleven, under the superintendence of three persons, who snail be ap- 
 pointed, by the President of the United States, commissioners for receiving 
 subscriptions to the said bank, any two of whom may act, and receive subcrip- 
 tions as aforesaid, until the fourth day of March, in the year one thousand 
 eight hundred and eleven. The sale of the stock aforesaid, shall be made by 
 the Secretary of the Treasury, in such portions, and at such times, as he shall 
 find necessary or expedient, for the best price he can obtain, either for money 
 or the six per cent, funded debt of the United States, as the exigencies of the 
 Government may render proper; and a credit or credit-, for such newly 
 created stock, shall be given to the purchaser thereof, on the books of the 
 treasury, in like manner as for the present domestic funded debt, which said 
 credits or stock shall thereafter be transferable, except as herein before 
 mentioned, only on the books of the treasury of the United States, by the 
 proprietor or proprietors of such stock, his, her, or their attorney, and may 
 be so disposed or by the national bank company, their agent or attorney, to 
 any person, or persons, whatsoever, or his, her, or their assigns, in manner 
 aforesaid; and, for the reimbursement of the principal of the said stock and 
 payment of the interest thereon quarter yearly at the treasury, the faith of the 
 Government of the United States is hereby pledged. So much of the pro- 
 ceeds of the sales of the said stock as shall be received in money, shall be, 
 and hereby is, appropriated towards the discharge of any of the current ex- 
 penses of the Government, which the Secretary of the Treasury may deem 
 most proper. 
 
 SEC. 2. And be it further enacted, That if the whole of the said sum of 
 three millons of dollars shall not have been issued in stock, in manner afore- 
 said, on or before the first day of January, in the year one thousand eight 
 hundred and eleven, and, also, in case none of the same shall have been then 
 issued, then, for the whole, or any part thereof, (as the case may be,) sub- 
 scriptions shall be opened, within sixty days thereafter, in such of the princi- 
 pal towns in the United States as the President of the United States shall 
 direct, under the superintendence of such persons as he shall appoint, not less 
 than three; and a majority of the said persons at the said places, respectively, 
 shall be sufficient to perform the duties of their appointment. It shall be the 
 duty of the said commissioners to advertise the time and place for receiving 
 such subscriptions within the said towns, respectively, in some newspaper 
 printed therein, for the space of twenty days, at least, before they shall open 
 books to receive subscriptions as aforesaid; they shall keep the subscription 
 open for the term of three days, and no longer, if the subscriptions for the 
 amount of stock, directed by the President of the United States to be taken 
 at such places, respectively, are completed in that time, but if they shall not 
 be completed at the expiration of that time, they shall keep them open for the 
 term of sixty days, unless the subscription is sooner completed; but if the 
 subscription is completed before the expiration of three days from the time it 
 
124 BANK OF THE UNITED STATES. 
 
 is opened, then, and immediately after the same shall be so filled, no person, 
 copartnership, or body politic, shall, during the remainder of the term afore- 
 said, be permitted to subscribe for more than five shares; and it shall be law- 
 ful for any citizen of the United States, copartnership, or body politic, within 
 the United States, in person, or by attorney, to subscribe for any number of 
 shares, not exceeding one hundred in one day, and all the subscriptions made, 
 and shares obtained in consequence thereof, shall be deemed and held to be 
 for the sole use and benefit of the person or persons, copartnership, or body 
 politic, subscribing, or in whose behalf the subscriptions, respectively, shall 
 be declared to be made at the time of making the same, any bargain, con- 
 tract, promise, or agreement, to the contrary notwithstanding. And in case 
 the amount of subscriptions, at any of the said places, shall exceed the num- 
 ber of shares appointed to be taken at such place, in the first three days, the 
 excess, thus created, shall be reduced within the number of shares authorised 
 to be subscribed at such place, or places, respectively, in manner following, 
 that is to say: from the subscription, and subscriptions highest in amount, the 
 commissioners shall subtract a share, or shares, until the same shall be made 
 equal to the subscription, or subscriptions, next highest in amount; and, as 
 often as the case shall require, they shall proceed to subtract a share, or 
 shares, from the subscription, or subscriptions, remaining, from time to time, 
 highest in amount, until the aggregate 01 all the subscriptions be reduced to 
 the number of shares authorised to be subscribed at the places which shall be 
 appointed respectively; and if by and after the operation of the said subtrac- 
 tion, as often as the same shall be necessarily made, a greater number of 
 shares may be allowed to one or more of the subscribers than to the rest, or if 
 the number of shares shall eventually be greater than the number of shares 
 authorised at such places, respectively, so that, at least one share cannot be 
 allowed to each subscriber, then, and in either of the before mentioned cases,, 
 the commissioners for such place shall ascertain by lot, in whom the greater 
 number of shares, or the right of subscribing for and retaining one share, (as 
 the case may be) shall be vested, and the subscriber, in whose favor the lot 
 may thereupon fall, shall be deemed, to all intents and purposes, the lawful 
 subscriber, and subscribers, for such share, or shares, respectively; and the 
 amount of the share, or shares, subscribed for, in manner aforesaid, shall be 
 paid by the several and respective subscribers, in gold or silver coin, at its 
 lawful value, one-fourth thereof at the time of subscribing, one-fourth in sixty 
 days thereafter, one-fourth in one hundred and twenty days thereafter, and 
 one-fourth in one hundred and eighty days from the time of the first election 
 of directors, or at any time sooner, that such subscriber, or subscribers, may 
 choose; the sums so received, respectively, shall be paid over by the said 
 commissioners to the order of the Secretary of the Treasury. And in case 
 any subscriber, as aforesaid, shall fail to pay any of the sums due from him. 
 her, or them, according to the terms of subscription, he, she, or they, shall 
 not be entitled to any dividend or dividends, or to vote on any such share, 
 until the payment of the sum due thereon, with interest from the time such 
 payment became due, shall be fully paid up and satisfied; and in case such 
 failure shall continue for the space of six months, such share, or shares, and 
 the sums which shall have been paid thereon, shall be wholly forfeited to the 
 use of the said bank, and the same shall be sold under such regulations as the 
 directors may establish. And the commissioners, aforesaid, shall, at the ex- 
 piration of the three first days, and once in every ten days thereafter, as long 
 as the subscription continues open, transmit to the Secretary of the Treasury 
 a fair list of all the subscriptions, and the names of the subscribers making 
 them. 
 
 SEC. 3. And be it further enacted. That, for the purpose of constituting 
 five millions more of the capital stock of the said bank, the President of the 
 United States shall, immediately after the passage of this act, notify the Gov- 
 ernors of each State thereof, and the Legislatures of the States which shall 
 enact laws authorising a subscription, in conformity to the provisions of this 
 act, may at a time to be appointed by the President of the United States, (not 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 exceeding six, or less than three months, from the time of such legislative act 
 being notified to him,) cause to be subscribed at such place as such legislature 
 shall direct within such State, and on behalf of such State, or any citizen of the 
 United States or the territories thereof, to whom such State may assign or dis- 
 pose of the right of subscribing, the following number of shares, to consist of 
 four hundred dollars each, to wit: the State ot New Hampshire, four hun- 
 dred shares; the State of Massachusetts, fifteen hundred shares; the 
 State of Connecticut, six hundred shares; Rhode Island, one hundred and fifty 
 shares ; Vermont, two hundred and fifty shares; the State of New York, fit- 
 teen hundred shares ; New Jersey, six hundred shares ; Pennsylvania, sixteen 
 hundred shares ; Delaware, one hundred and fifty shares ; Maryland, eight 
 hundred shares; Virginia, eighteen hundred shares; North Carolina, one 
 thousand shares; South Carolina, six hundred shares; Georgia, five hundred 
 shares; Kentucky, six hundred shares; Tennessee, three hundred shares; and 
 Ohio, one hundred and fifty shares and the amount payable on the shares so 
 respectively subscribed by the States, or any of them, or any of their assignees, 
 being citizens of the United States, shall be paid in gold or silver coin, at their 
 current value ; the first payment on each of which shares, shall be made at 
 the time of subscribing, to the amount of forty dollars, into the hands of such 
 persons, not less than three at each place of subscription, whom the States 
 shall respectively authorize to recieve the subscription, to the said capital stock, 
 of the appointment of which commissioners, as soon as made, the proper au- 
 thority of the States shall notify the Secretary of the Treasury, who shall im- 
 mediately direct the said commissioners to place the same to the credit of the 
 national bank company, in such bank or place of safe deposite as the Secretary 
 of the Treasury shall appoint, which deposite shall be subject to his order for 
 the use of said bank company, until the first election of directors of the said 
 bank to be thereafter made at the Seat of Government of the United States, 
 and the balance of the sum due on each share as aforesaid, shall be paid into 
 the national bank at Washington, or any of the branches thereof, in gold or 
 silver coin, at their value, at such times, and in such portions as the stockhold- 
 ers so subscribing shall choose : Provided, That the subscribers or stock- 
 holders aforesaid, shall not be permitted to pay at any one time less than forty 
 dollars on each share, and shall not be entitled to any greater portion of the 
 dividends made by the said bank, than according, and in proportion to the 
 sum actually paid on the shares upon which such dividend is claimed, but 
 shall be entitled to such dividend, according to the portion paid on such share, 
 when any dividend shall be declared after the expiration of six months from 
 the time of any payment made, and not sooner. The mode of opening such 
 subscriptions in the States, respectively, and carrying them into effect, except 
 as is by this act otherwise directed, shall be according to the rules and pro- 
 visions which such State so subscribing shall direct and establish : Provided, 
 That any forfeitures which accrue of the rights of subscribers to such stock, 
 shall be and enure to the use of the national bank company only. 
 
 SEC. 4. And be it further enacted, That such States as shall assent to the 
 provisions of this act, and choose to avail themselves thereof, shall, on or be- 
 fore the first day of January, in the year one thousand eight hundred and 
 twelve, notify by the proper authority, the President of the United States 
 thereof, and shall also by any law passed authorising the subscriptions afore- 
 said, express the assent of the legislature thereof to the establishment of a 
 branch of the national bank within such State, and at such place as the direc- 
 tors of the said bank at the Seat of the Government of the United States shall 
 appoint : Provided, The capital assigned to such branch by the directors 
 aforesaid, shall not exceed the amount of capital subscribed for within such 
 State respectively : And provided, also, That, incase any of the States of ihe 
 Union shall fail to comply with the terms of this act, or to notify the President 
 of the United States, on or before the first day of January, one thousand eight 
 hundred and twelve, of their assent to them, it shall be lawful for Congress to 
 extend the time for such assent to be given, until the first day of January, in 
 the year one thousand eight hundred and thirteen, and no longer; and in case 
 
 
BANK OF THE UNITED STATES. 
 
 the States of the Union, or any of them, do not assent to the terms of this act, 
 at or before the last mentioned period, for the whole amount of the sum here - 
 by proposed to be subscribed by the States, or for any part thereof, then sub- 
 scriptions may be opened for a part, or the whole, (as the case may be,) by 
 order of a general meeting of the stockholders of the said bank, in such man- 
 ner, at such place, and at such time thereafter, as shall by the company of the 
 said bank, or the president and directors thereof, at the Seat of Government, 
 be appointed. 
 
 SEC. 5. And be it further enacted, That, for the purpose of constituting 
 four millions more of the capital stock of the said bank, it shall be lawful for 
 the President of the United States, and he is hereby authorised, at any time 
 within two years after the passing of this act, to cause a subscription to be 
 made on behalf of the United States, to an amount not exceeding four millions 
 of dollars, to be borrowed from the bank aforesaid, at any time after it goes 
 into operation, or sooner, from any person or body coporate, at a rate of in- 
 terest not exceeding percent, and reimbursable in ten years, by equal an- 
 nual instalments, or at any time sooner, or in any greater proportions that the 
 Government may think fit ; the first instalment to become due in one year 
 from the time the said bank goes into operation, at which time the first pay- 
 ment borrowed as aforesaid, shall be made to the said bank, or such other per- 
 son or body corporate from \vhom the same may be borrowed by the United 
 States ; and the sum so borrowed, with the interest quarter yearly thereon, 
 shall be reimbursable and paid out of any moneys in the treasury, not other- 
 wise appropriated. 
 
 SEC. 6. Jind be it further enacted. That, for the purpose of constituting 
 three millions more of the capital stock of the national bank, it shall be law- 
 ful for the bank companies, or associations, which have been organized within 
 the District of Colombia, or such of them as may choose, on or before the 
 fourth day of March, in the year one thousand eight hundred and eleven, in 
 pursuance of an order of the stockholders of the said banks, or either of said 
 banks, at a general meeting, to notify the Secretary of the Treasury of their 
 intention to subscribe their capital stock to the national bank, and if such 
 company or their agent or agents shall, in sixty days thereafter, pay into the 
 national bank, if it shall have commenced its operations, and if not, shall, in 
 sixty days after the first election of directors at Washington, pay one-third of 
 the amount of the stock subscribed, in specie, and the remaining two- thirds in 
 good notes due in ninety days, or a shorter period, which notes shall be endorsed 
 and guaranteed by the president of such bank on behalf of the company, then 
 such sums so paid in, shall entitle those for whose use the same may be paid, to a 
 share in the said bank for every four hundred dollars so paid; and it shall be 
 lawful for the Secretary of the Treasury to make any further arrangement with 
 the said companies, or associations, which, to him, shall seem right, and shall be 
 agreed on between them, in order effectually to incorporate the funds of such 
 bank company, or association, into the capital of the national bank, in the man- 
 ner most convenient and profitable to the said companies and the national 
 bank; and, in case the said sum of three millions of dollars, or any part there- 
 of, shall not be subscribed by the said bank companies, or associations, in man- 
 lier herein provided, and at the times herein mentioned, or, if no notice of an 
 intention to do so is given by the time aforesaid, it shall be lawful for the 
 President of the United States, at any time after the fourth of March, in the 
 year one thousand eight hundred and twelve, with the assent of the stockhold- 
 ers of the national bank, previously expressed at a general meeting, to cause 
 to be constituted the said three millions of dollars of the said stock, or so 
 much thereof as shall not have been so subscribed by the said banks, or asso- 
 ciations, on the same terms and conditions, (with such alterations only as 
 may be necessary in point of form") as by the first and second sections of 
 this act, subscriptions ot stock to the national bank are provided and direct- 
 ed to be received. 
 
 SEC- 7. Jind be it further enacted, That the subscribers, their successors 
 and assigns, being bodies corporate and politic, within the United States, or 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 the territories thereof, or being citizens of the United States, or the territories 
 thereof, shall be, and are hereby, erected and made a corporation and body po- 
 litic, by the name and style of the president, directors and company of the na- 
 tional bank, and by that name shall be, and are hereby, made able and capable 
 in law, to have, purchase, receive, possess, enjoy, and retain, to them and their 
 successors, land, rents, tenements, hereditaments, goods, chattels, and effects 
 of what kind soever, to an amount not exceeding, in the whole, ten millions of 
 dollars, exclusive of the amount of the capital stock aforesaid, and the same to 
 sell, grant, alien, demise, or dispose of; to sue and be sued, im plead and be im- 
 pleacTed, answer and be answered, defend and be defended, in courts of re- 
 cord, or any other place whatsoever; and also to make, have, and use a com- 
 mon seal, and the same to break, alter, and renew at their pleasure, and also to 
 ordain, establish, and put in execution such by-laws and ordinances, as shall 
 seem necessary and convenient (or the government of the said corporation, 
 not being contrary to law or to this charter: and for ihe making whereof, 
 general meetings may be called by the directors, in the manner hereinafter 
 specified; and generally to do and execute all and singular the acts, matters, 
 and things which to them it shall or may appertain to do, subject, nevertheless, 
 to the rules, regulations, restrictions, limitations, and provisions in this act 
 prescribed and declared. 
 
 SEC. 8. And be it further enacted, That, for the well ordering the affairs of 
 the said bank, there shall be elected, annually, on the first Monday in January, 
 at the Seat of Government, directors, who shall be citizens of the United 
 States at the time of election, and shall be stockholders in the said bank, all 
 of whom shall be elected by the stockholders of said bank; and, at the same 
 
 time, the President of the United States shall appoint other persons, 
 
 on behalf of the Government, as directors of said bank at Washington; and 
 the Secretary of the Treasury, for the time being, shall be a director of said 
 bank, ex-officio. At the same time, there shall be chosen, annually, in the 
 different States, or such of them in which branches of me national bank 
 shall be established, at the places where such branches are respectively es- 
 tablished, by the stockholders, directors; and there shall be appointed, 
 
 under the authority of such State, other directors, and by the Secretary 
 
 of the Treasury, on behalf of the United States, other directors, and 
 
 the said directors, so chosen and appointed, for the said bank and branches, 
 respectively, shall, at the first meeting held by them, respectively, choose 
 one of their number as a president of such bank, or branch bank; and the 
 president and directors so chosen and appointed, shall serve by virtue thereof, 
 irom the time they shall be notified of their election, till the expiiation of the 
 succeeding first Monday in January, and from thence, until they shall be no- 
 tified of a subsequent election having been made, and no longer. The first 
 elections shall be held at the time and in the manner herein after directed: 
 Provided. That in case it .should at any time happen that an election of di- 
 rectors shall not be made, on any day when, pursuant to this act, it ought to 
 have been made, the said corporation shall not, therefore, be deemed to be 
 dissolved, but it shall be lawful on any other day, within one hundred days 
 thereafter, to hold and make an election of directors, by order of the Secre- 
 tary ot the Treasury, who shall advertise the same in a public manner, at the 
 place where such election is to take place, at least ten days before such elec- 
 tion, at which election the same rules shall be observed as at other elections, 
 and such further rules as the said corporation shall direct. And in case of 
 the death, resignation, or absence from the United States, of a director in 
 the bank aforesaid, or any of the branches thereof, his place shall be filled by 
 a new choice, for the remainder of the term for which he was elected, by the 
 vote of a majority of the directors at the place Ayhere such vacancy shall hap- 
 pen. Every person voting at any election of directors, shall, previous to 
 giving his or her vote, make oath, or solemnly affirm, that he, or she, is a citi- 
 zen of the United States; that the share or shares on which he or she offers 
 to vote, is, or are, really and bona fide his or her own property, and not held 
 in trust, or for the use, benefit, or emolument, of any other person or persons 
 
128 BANK OF THE UNITED STATES. 
 
 whatsoever; and when any person offers to vote as a proxy, an affidavit to 
 the same effect, of the person whom he represents, shall be sufficient, if made 
 before a proper authority 5 and to take any such oath falsely, shall be perjury, 
 and punishable as such on prosecution, by indictment or information. 
 
 SEC. 9. Jind be it further enacted^ That, in case the certificates of stock 
 authorized by the first section of this act to be created, shall have been sold, 
 either in whole, or in part, at the time herein limited for the sale thereof, im- 
 mediately thereafter, or as soon as the whole of said stock is sold (as the case 
 may be) books shall be opened, under the direction of the Secretary of the 
 Treasury, for the purpose of receiving subscriptions to the capital of the said 
 bank, in the stock so sold, if any, and certificates of a share in the national 
 bank, for each four hundred dollars of the principal of said public stock, 
 shall be granted to the holder or holders thereof, who shall present the same 
 for subscription, on or before the fourth day of March, in the year one thou- 
 sand eight hundred and eleven; which public stock, so paid in, and constitut- 
 ing a part of the funds of the said bank, may, to the amount of one million 
 of dollars thereof, if the Secretary of the Treasury shall deem it necessary, 
 in order to expedite the commencement of the operations of the said bank, 
 be sold for specie for the use of the said bank; and, as soon as the sum of one 
 million of dollars shall be received by the Secretary of the Treasury, for the 
 use of the said bank, in that, or in any of the ways directed by this act, for 
 obtaining subscriptions thereto, notice thereof shall be given by the Secretary 
 of the Treasury, in some newspaper printed in the city of Washington, and 
 also in some newspaper printed at the Seat of Government of each State, that 
 such sum has been received, and shall also notify a time, not less than fifty 
 days from the time of such publication, for making the first election and ap- 
 pointment of directors for the said bank at Washington: Provided, That it 
 shall not be at an earlier period than the fourth day of March, in the year one 
 thousand eight hundred and eleven, and an election for the directors for the said 
 Bank of Washington shall accordingly be made. And the directors so appoint- 
 ed and elected at Washington, in pursuance of the directions of this act, shall be 
 capable of serving as such, until the next election shall be made under the 
 provisions of this act; and the said directors shall forthwith commence the 
 operations of the said bank, and provide for the establishment of such branches 
 thereof, as shall be authorized by any of the States of the Union, in pursuance 
 of the provisions of this act; and incase the bank companies, or associations, 
 in the District of Columbia, shall subscribe according to the terms of this act, 
 shall establish a branch of the national bank in the town of Alexandria, and 
 another in Georgetown, and shall appoint, within twenty days from the time 
 of the terms of subscription being complied with by the said bank companies, 
 or either of them, the time and place when an election shall be held by the 
 
 stockholders for directors of such branch banks, respectively, within 
 
 the District of Columbia, as shall be established by them, in addition, 
 
 to whom shall be appointed by the Secretary of the Treasury, who, imme- 
 diately after the first election, and at every election and appointment there- 
 after, shall choose one of their own body as president; and successive elec- 
 tions and appointments shall be held and made in the same manner, and under 
 the same regulations, as near as may be, for the said branches, as in the State 
 branches they are directed to be held, the Secretary of the Treasury perform- 
 ing all the duties, which the States respectively may perform in such elections, 
 and regulating all other matters and things respecting the said branches, as 
 may be agreed on by him with the said companies or associations: Provided, 
 That the bank company, or association, organized in the city of Washington, 
 if they shall choose to incorporate themselves with the national bank, shall 
 be incorporated into the principal bank to be established there; and the Se- 
 cretary of the treasury may, moreover, provide for the continuance of the 
 operation of the said banks, according to their present establishments, until 
 their funds shall, under the provisions of this act, be actually transferred to 
 the national bank, after which time, such associations and companies shall 
 be considered as dissolved.. 
 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 129 
 
 SEC. 10. And be it further enacted, That the directors of the bank at Washing- 
 ion, shall allot to the said bank and the branches thereof, the portion of capital 
 which each shall, from time to time, be justly entitled to, subject to the re- 
 strictions in this act provided, and may establish offices of discount and deposite, 
 as branches of the national bank, in any of the territories of the United States, 
 (except the District of Columbia, in which branches shall only be established in 
 manner aforesaid,) and shall regulate the amount of capital to be placed in any 
 of the said branches; and in the said territories, (except that of Columbia,) 
 where branches are by them established, shall appoint nine directors for each 
 annually, and regulate the time and other things relative to their service, and 
 shall appoint a cashier and principal clerk of said territorial branches, when 
 by them established; but the directors of the said branch, or branches, of dis- 
 count and deposite, respectively, shall appoint all other officers and servants, 
 of such branch bank, or banks. The directors of the said bank, at Washing- 
 ton, shall appoint such officers, clerks, and servants, as shall be necessary to 
 execute the business of the said bank, and the branches of the said bank, in the 
 several States, and in the District of Columbia, shall appoint their officers, 
 clerks, and servants, under them, for the purposes of executing the necessary 
 business of their banks respectively; but the salaries of such officers, clerks, 
 and servants, and of the compensation to be allowed to the presidents of the 
 different banks, shall be fixed on, and increased, or diminished, by the presi- 
 sident and directors of the principal bank: Provided, Such salaries and 
 compensations, shall not be determined on, except when the Secretary of the 
 Treasury shall be present, and shall give his vote on the subject; and the di- 
 rectors of the bank at Washington, shall do every other matter and thing, 
 not contrary to law, or the provisions of this act, which may be necessary for 
 the establishment and regulation of the said banks of discount and deposite, 
 in the said Territories, or States. 
 
 SEC. 11. ^nd be it further enacted, That the following rules, restrictions, 
 limitations, and provisions, shall form, and be fundamental articles of the 
 constitution ot said corporation, viz: 
 
 1. The number of votes to which each stockholder shall be entitled, except 
 the United States, and the States respectively, shall be according to the 
 number of shares he shall hold, in the proportions following, that is to say: 
 For one share, and not more than two shares, one vote: for every two shares 
 above two, and not exceeding ten, one vote: for every four share above ten, 
 and not exceeding thirty, one vote: for every six shares above thirty, and not 
 exceeding sixty, one vote: for every eight shares above sixty, and not exceed- 
 ing one hundred, one vote: and for every ten shares above one hundred, one 
 vote. But no person, co-partnership, or body politic, shall be entitled to a 
 greater number than thirty votes. And after the first election, no share, or 
 shares, shall confer a right of suffrage, which shall not have been holden three 
 calendar months previous to the day of election. None but citizens of the 
 United States, shall vote at any election, by proxy, or in person, nor shall be 
 a director of the national bank, or any of its branches, 
 
 2. Not more than three-fourths of the directors in office, chosen by the 
 stockholders, the president excepted, shall be eligible, or capable of appoint- 
 ment for the next succeeding year. But, the director who shall be president 
 at the time of an election, may always be re-elected, or re. -appointed, as the 
 case may be. 
 
 3. None but a stockholder, being the owner of two shares, and being a citi- 
 zen of the United States, and resident therein, shall be capable of being chosen 
 or appointed as a director. 
 
 4. No director shall be entitled to any emolument, unless the same shall 
 have been allowed by the stockholders, at a general meeting. The stockhold- 
 ers shall make such compensation to the president of the principal bank at 
 Washington, for his extraordinary attendance at the bank, as shall appear to 
 them reasonable. 
 
 5. Not less than a majority of directors shall constitute a board for the 
 transaction of business, of whom the president shall always be one. except in 
 
 17 
 
130 BANK OF THE UNITED STATES. 
 
 case of sickness, or necessary absence; in which case, his place may be supplied 
 by any other director, whom he, by writing, under his hand, shall nominate- 
 forth e purpose. 
 
 6. A number of stockholders, not less than fifty, who, together, shall be 
 proprietors of two hundred shares, or upwards, shall have power,, at any timey 
 to call a general meeting of the stockholders, for purposes relative to the insti- 
 tution, giving at least, ten weeks' notice, in two public gazettes, of the place 
 where the bank is kept, and specifying, in such notice, the object, or objects, 
 of such meeting. 
 
 . Every cashier, or treasurer, before he enters upon the duties of his office,, 
 shall be required to give bond, with two or more sureties, to the satisfaction: 
 of the directors, in a sum not less than fifty thousand dollars, with condition 
 for his good behavior. 
 
 8. The lands, tenements, and hereditaments, which it shall be lawful for 
 the said corporation to hold, shall be only such as shall be requisite for its im- 
 mediate accommodation, in relation to the convenient transaction of its busi- 
 ness, and such as shall have been bona fide mortgaged to it by way of securi- 
 ty, or conveyed to it in satisfaction of debts previously contracted, in the 
 course of its dealings, or purchased, at sales upon judgments, which shall 
 have been obtained tor sucn debts. 
 
 9. The total amount of the debts, which the said corporation shall at any time 
 owe, whether by bond, bill, note, or other contract, shall not exceed the sum 
 of fifteen million of doll are, over and above the moneys then actually deposited 
 in the bank, for safe keeping, unless the contracting of any greater debt, shall 
 have been previously authorised by a law of the United States. And it is 
 hereby enacted, that it shall not be lawful for the said bank to contract any 
 debt with the United States, to a greater amount than thirty millions of dol- 
 lars, or with any State, than twice the amount of capital subscribed, in such 
 State: and, in case of excess, the directors, under whose administration it 
 shall happen, shall be liable for the same, in their natural and private capaci- 
 ties, and an action of debt may, in such case, be brought against the>:n, or any 
 of them, their, or any of their heirs, executors, or administrators, in any court 
 of record of the United States, or either of them, by any creditor, or creditors,, 
 of the said corporation, and may be prosecuted to judgment, and execution,, 
 any condition, covenant, or agreement, to the contrary notwithstanding. But, 
 this shall not be construed to exempt the said corporation, or the lands, tene- 
 ments, goods or chattels of the same, from being also liable for, and chargea- 
 ble with, the said excess. Such of the said directors, who may have been ab- 
 sent, whenthesaid excess was contracted, or created, or who may have dissented 
 from the resolution, or act, whereby the same was so contracted, or created, 
 may respectively exonerate themselves from being so liable, by forthwith giv- 
 ing notice of the fact, and of their absence or dissent, to the President of the 
 United States, and to the stockholders, at a general meeting, which they shall 
 have power to call for that purpose. 
 
 10. The said corporation, shall not, directly or indirectly, deal, or trade, in 
 any thing except bills of exchange, gold or silver bullion, or in the sale of 
 goods, really and truly pledged for money lent, and not redeemed indue time, 
 or of goods which shall be the produce of its lands Neither shall the said cor- 
 poration take more than at the rate of six per centum per annum, for, or upon 
 its loans, or discounts. 
 
 11. No loan shall be made by the said corporation, for the use or on account 
 of the Government of the United States, to an amount exceeding one hun- 
 dred thousand dollars, or of any particular State, to an amount exceeding 
 fifty thousand dollars, or of any foreign prince or State, unless previously au- 
 thorized by a law of the United States. 
 
 12. The stock of the said ^corporation shall be assignable and transferable 
 according to such rules as shall be instituted in that behalf, by the laws and 
 ordinances of the same.; except that no stock shall be assignable or transfer- 
 able either in law or equity, to any person or persons^who are not citizens of 
 the United States, or a body politic or corporate within the same, 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 13. The bills obligatory and of credit, under the seal of the said corpora- 
 tion, which shall be made to any person or persons, shall be assignable by en- 
 dorsement thereupon, under the hand or hands of such person or persons, and 
 of his, her, or their assignee or assignees, and so as absolutely to transfer and 
 vest the property thereof in each and every assignee or assignees successively, 
 and to enable such assignee or assignees to bring and maintain an action there- 
 upon, in his, her, or their own name or names. And bills or notes, which 
 may be issued by order of the said corporation, signed by the president and 
 countersigned by the principal cashier or treasurer thereof, promising the pay- 
 ment of money to any person or persons, his, her, or their order, or to bearer, 
 though not under the seal of the said corporation, shall be binding and obliga- 
 tory upon the same, in the like manner, and with the like force and effect, as 
 upon any private person or persons, if issued by him or them, in his, her, or 
 their private or natural capacity or capacities; and shall be assignable and ne- 
 gotiable, in like manner, as if thej were so issued by such private person or 
 persons: That is to say, those which shall be payable to any person or per- 
 sons, his, her, or their order, shall be assignable by endorsement, in like man- 
 ner, and with the like effect, as foreign bills of exchange now are; and those 
 which are payable to bearer shall be negotiable and assignable by delivery 
 only. 
 
 14. Half yearly dividends shall be made of so much of the profits of the 
 bank, as shall appear to the directors advisable; and once in every three 
 years, the directors shall lay before^the stockholders, at a general meeting, 
 for their information, an exact and -particular statement of the debts which 
 Shall have remained unpaid after the expiration of the original credit, for a 
 period of treble the term of that credit, and of the surplus of profit, if any, 
 after deducting losses and dividends. 
 
 The directors of the bank, and its several branches, shall keep fair and 
 regular entries of all their proceedings, in a book to be provided for that pur- 
 pose, and on any question, where two directors hall require it, the yeas and nays 
 of the directors voting, shall be duly inserted on their minutes, and be sub- 
 ject to inspection at a general meeting of the stockholders. No cashier of 
 any of the said banks shall be allowed to carry on any other business, or to 
 deal in any manner, in any of the public stock or funds, under the penalty of 
 ten thousand dollars for every sucn offence, to be recovered in any court of 
 the United States, within whose jurisdiction it shall happen, by indictment or 
 information, one half to the use of the informer, and the other half to the use 
 of the United States, and shall, on proof ? to the satisfaction of the directors, 
 of any such offence, be immediately dismissed from office. 
 
 Sec. 12. And be it farther enacted, .That there shall be appointed, as soon 
 as the said bank commences its 9Derations, by the President of the United 
 States, a superintendent of the saia bank and its branches, whose duty it shall 
 be, to require and receive from the directors of the said bank, a statement, at 
 least once a month, of the amount and nature of the capital stock of said cor- 
 poration; a list of all the stockholders of the said bank; a statement of the 
 debts due to the same, and of the moneys deposited therein; of the notes in 
 circulation and of the cash on hand, and shall have a right to inspect such 
 general accounts, or require copies thereof from the books of the said corpo- 
 ration, as shall relate to such statements, but shall not have the right to in- 
 spect the account of any private person with the bank. And the said super- 
 intendent shall^at all times, when required, furnish to Congress or to the Se- 
 cretary of the Treasury, any information in his power or possession, relative 
 to the said bank or its brandies. He shall, moreover, when he deems it pro- 
 per, furnish any information to the Secretary of the Treasury on the subject 
 of said banks, and shall give his opinion in writing or in person, at a meeting of 
 the directors of any of the said banks, on any subject touching the affairs thereof, 
 which he may deem proper, but shall not, in any case whatever, have a right to 
 vote. He shall keep an office and reside at the Seat of Government, and be 
 entitled to such compensation for his services as the president and directors 
 
152 BANK OF THE UNITED STATES. 
 
 of the bank at Washington shall think proper to allow, and shall hold his 
 office during the pleasure of the President of the United States. 
 
 SEC. 13. And oe it further enacted. That the bills or notes of the said cor- 
 poration, originally made payable, or which shall have become payable on de- 
 mand, shall be demandable during the continuance of this act, in gold or silver 
 coin, at their current value, ana shall be receivable in all payments to the 
 United States. 
 
 SEC. 14. And be it further enacted, That this charter, and the corporation 
 hereby created, shall continue until the year one thousand eight hundred and 
 forty, unless by the consent of the stockholders, at a general meeting, and a 
 future law of Congress, the capital stock of the said bank should be increased 
 to thirty millions of dollars, giving to the States respectively, and to the Unit- 
 ed States, the same proportions* and providing, in every respect, similar re- 
 gulations, so far as circumstances may admit, for the increase aforesaid, as 
 are provided by this act for the ""establishment of the national bank; and, in 
 like manner, it the capital should be so increased, the term of continuance of 
 the charter of the said corporation may be extended to the year one thousand 
 eight hundred and fifty. 
 
 APRIL 4. 1810. 
 
 A motion was made by Mr. LOVE, that the House do come to the following 
 resolutions: 
 
 " Resolved, That the Secretary of theTTreasury be requested to furnish this 
 House with the names and titles of the sockholders of the Bank of the United 
 States, if any document in his office will afford that information, and if not, 
 to endeavor to obtain that information from the bank aforesaid, and lay it be- 
 fore this House as soon as possible. 
 
 i4 That the Secretary of the Treasury be requested to furnish this House,, 
 with the number of shares voted on at the last election of directors, and the 
 names of those voting, if to be Obtained. 
 
 rt That he be requested to state to this House, by what information he wa* 
 enabled, in his report of March, 1809, made to the Senate of the United 
 States, tx> fix the average of dividends of said bank, at eight three -eighths, pre- 
 cisely eight thirteen-thirty-fourths per cent, per annum, and also state the 
 amount of public stock or other public debt, held by the said bank company 
 on each first day of January, since its operations commenced. 
 
 " Resolved^ That the Secretary of the Treasury be reqested to inform this 
 House what is the amount of capital retained in Philadelphia by the Bank of 
 the United States, and what amount thereof, distributed to the branches of 
 that bank, respectively f what have been the average amounts of deposites of 
 public money, in each of those banks, in any preceding year, or for the year 
 1808, if as practicable to obtain it as any other; and whether the sum of 800 ? 000 
 dollars, stated in his said report, to be due from the State banks to the United 
 States Bank Company, was due on account of deposites of public money, or 
 not." 
 
 A motion was made by Mr. QUINCY, to amend the first resolution thereof* 
 by inserting the word " foreign" before the word " stockholders. ." 
 
 The said resolutions were read and ordered to lie on the table. 
 
 APRIL 7, 1810. 
 
 Mr. TAYLOR, from the committee to whom was referred on the 29th ultimo,. 
 the report of a select committee on the memorial of the stockholders of the 
 Bank 
 twent 
 Bank" 
 which was received and read the first time. 
 
 On motion, the said bill was read the second time, and committed to a Com- 
 mittee of the Whole House on Monday next- 
 
 The said bill is as follows: 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 A bill continuing" in force, for a term of twenty years, the act, entitled " An 
 act to incoi-porate the subscribers to the Sank of the United Stales," on the 
 terms and conditions therein mentioned. 
 
 Be it enacted by the Senate and House of Representatives of the United 
 States of America, in Congress assembled. That the act, entitled " An act 
 to incorporate the subscribers to the Bank of the United States," passed. the 
 twenty -fifth day of Febniary, in the year of our Lord seventeen hundred and 
 ninety-one, subject to the provisions and conditions in this act to be made, 
 be, and the same is hereby continued in force, for and during the further term 
 of twenty years, from and after the fourth day of March next: Provided, 
 That the President and Directors of the said Bank of the United States, shall, 
 on or before the thirty-first day of December next,\ pay into the treasury of 
 the United States one million two hundred and fifty thousand dollars, as the 
 price and equivalent for th<> renewal and continuance of their charter as afore- 
 said; and the better to enable the said President and Directors of the said 
 bank to pay the said sum of money, the said President and Directors of the 
 Bank of the United States shall be, and they are hereby authorised to add to 
 the capital stock of said bank two thousand five hundred shares, and to sell 
 and dispose of the same, at such time, and in such manner, and at such price 
 as they may think proper, and for the most advantage for the interest of their 
 said company: Provided, also, That the said President arid Directors of the 
 said bank shall, at all times, from and after the passage of this act, and during 
 the continuance of the same, be bound and obliged to make a loan or loans to 
 the United States, if required and authorised by law, of any sum or sums of 
 money, not exceeding in the whole, at any one time, five millions of dollars, 
 and at a rate of interest not exceeding six per centum per year: Provided, 
 That it shall be the duty of the Secretary of the Treasury of the United States 
 to make his application in writing, to the President and Directors_of said 
 bank, for sucfi loan or loans, at least three calendar months previous to the 
 time when such loan or loans shall be required; and that the said President 
 and Directors of the said bank, shall not be required to make a loan of more 
 than two million five hundred thousand dollars during the present year, nor 
 more than the last mentioned sum during any other year: Provided, also, That 
 the President and Directors of the said bank, shall, from and after the fourth 
 day of March, eighteen hundred and eleven, pay to the United States an in- 
 terest at the rate of three per centum per year on all sums of money above the 
 sum of three millions of dollars, which shall accumulate to the credit of the 
 Treasurer of the United States in the said bank, or in any of the branches of 
 said bank, and which shall remain there for one whole year: Provided, That 
 it shall be the duty of the Secretary of the Treasury of the United States, 
 from time to time, to give notice in writing to the President and Directors of 
 the said bank, at least sixty days before the term or time at which said in- 
 terest, to be paid as aforesaid, shall be considered to commence and begin to 
 accrue; which notice in writing, shall specify the precise amount of the de- 
 posite, so to remain for one whole year as aforesaid: Provided, also, That the 
 United States shall be authorised, at any time during the continuance of this 
 act, to increase the capital stock of baid bank in such manner as may here- 
 after be prescribed by law, and for which the United States shall become the 
 
 subscriber and owner, to an amount not exceeding in the whole shares 
 
 and not exceeding in any one year shares: Provided, That the shares 
 
 thus to be added and subscribed for, on behalf of the United States, shall not 
 
 be sold by the United States at a price less than for each share: And 
 
 provided, also, That nothing in this act contained, nor in the act intended to 
 be continued in force by this act, shall be construed to restrict or prevent the 
 United States from incorporating any bank or banks in the District of Colum- 
 bia: Provided, That any bank to be incorporated by the United States in the 
 District of Columbia, shall be restricted from extending any branch thereof 
 beyond and without the limits of the said territory. 
 
 SEC. 2. And be it further enacted by the authority aforesaid, That it shall 
 be the duty of the President and Directors of the said bank, on or before the 
 
134 BANK OF THE UNITED STATES. 
 
 day of next, to signify to the President of the United States, their 
 
 acceptance on behalf of the Bank of the United States, of the terms and con- 
 ditions in this act contained, and if they shall fail to do so, on or before the 
 day above mentioned, that then this act shall cease to be in force. 
 
 APRIL 13, 1810. 
 
 The House resolved itself into a Committee of the Whole on the said bill; 
 and after some time spent therein, Mr. Speaker resumed the chair, and Mr. 
 MA CON reported, that the committee had, according to order, had the said bill 
 under consideration, made some progress therein, and directed him to ask 
 leave to sit again. 
 
 And on the question, Shall the Committee have leave to sit again on the 
 said bill? It was determined in the negative. 
 
 APRIL 20, 1810. 
 
 The House proceeded to consider the said bill. 
 
 A motion was made by Mr. SWOOPE, to amend the said bill, by striking out. 
 in the ninth line and first section, from the word " next" to the word " share," 
 in the sixty-second line, for the purpose of inserting the following: 
 
 Provided. That on the 4th day of March, 1811, the President and Directors 
 of the said Bank of the United States, shall be, and they are hereby, autho- 
 rized to add to the capital stock of the said bank, twelve thousand five hun- 
 dred shares, and for which the United States shall become the subscriber and 
 owner: Provided, also, That the President and Directors of the said bank 
 shall receive in payment therefor, the sum of five millions of dollars in stock 
 of the United States, bearing an interest of three per cent, per annum, payable 
 quarter yearly, and redeemable at the pleasure of the Government, which 
 stock as aforesaid, the Secretary of the Treasury is hereby authorized to issue 
 and pay over to the President and Directors, on receiving from them a trans- 
 fer, in behalf of the United States, of the twelve thousand five hundred shares 
 as aforesaid: Provided, also, That the United States shall be authorized at any 
 time after the 4th of March, 1821, to increase the capital stock of the said 
 bank in such manner as may be hereafter prescribed by law, and for which 
 the United States shall become the subscriber and owner, to an amount not 
 exceeding twelve thousand five hundred shares: Provided, nevertheless, That 
 such addition to the capital shall not be made at the time aforesaid, unless 
 the average dividends for the three years preceding that period, shall have 
 amounted to eight per centum, on the capital stock otsaid bank; and after the 
 said fourth day of March, 1811, the Secretary of the Treasury shall be a di- 
 rector of the said bank ex officio. 
 
 And, after debate thereon, the House adjourned. 
 
 APRIL 21, 1810. 
 
 *The House resumed Hie consideration of the motion made by Mr. SWOOPB 
 yesterday. 
 
 A division of the qustion on the said amendment was called for, when a 
 motion was made by Mr. LOVE, that the said bill be postponed indefinitely, 
 which was determined in the negative. Yeas 46, nays 67. 
 
 The question was then taken on the first member of the motion of Mr. 
 SWOOPE, to wit: to strike out, in the 9th line, first section, from the word 
 " next" to the word " share," in the 62d line, and determined in the negative. 
 
 The second member of the said motion failed, of course. 
 
 A motion was then made by Mr. LOVE, to amend the said bill, by striking 
 out the following words contained in the first section thereof, beginning with 
 the following words: u That the act, entitled 4 An act to incorporate the sub- 
 scribers to the Bank of the United States,' passed the 25th day of February, 
 in the year of our Lord 1791, subject to the provisions and conditions in this 
 act to be made, be, and the same is hereby, continued in force," &c. and ter- 
 minating with the following: " Provided, That any bank to be incorporated 
 by the United States in the District of Columbia, shall be restricted from 
 
ON THE BILL TO RENEW THE CHARTER OF 1791, 
 
 extending any branch thereof beyond and without the limits of the said terri- 
 tory," for the purpose of inserting the following: 
 
 " In case no law shall been acted by Congress before the fourth day of March, 
 one thousand eight hundred and eleven, authorizing the further continuation 
 of the charter of the company of the United States Bank, the said company 
 shall, notwithstanding, be authorized, and they hereby, are authorized, to con- 
 tinue for the space of two years from that date, their loans which shall, on that 
 day be in existance, by renewing the same or otherwise, in the manner now 
 practised in the said bank and the branches thereof; to sue and be sued, and 
 do all other matters and things which the said company is now able to do. 
 Provided, Thati the said company shall not issue or alter any bank note 
 signed by the President of the said bank, or in any other manner create 
 or alter, after the said fourth day of March, any note or other currency under 
 the authority of the said company or directors, or any of them; and that, after 
 that date, the notes which may be in circulation shall not be receivable in pay- 
 ments due to the United States, unless made so by a law hereafter enacted." 
 
 A division of the question on the said amendment was called for. and on 
 the question so to strike out, it was determined in the negative. Yeas 34, 
 navs 73. 
 
 The second member of the said motion failed of course. 
 
 The bill was amended on motion of Mr. TAYLOR, at the Clerk's table. 
 
 A motion \yas then made by Mr. TROUP, to amend the bill, by striking out 
 the first proviso in the first section of the bill, which was determined in the 
 negative. Yeas 35, nays 75. 
 
 A motion was then made by Mr. TAYLOR, to extend the term to twenty-five 
 years, and debate arising thereon, the House adjourned. 
 
 APRIL 23, 1810. 
 
 Mr. TAYLOR called for the consideration of the aforesaid bill, when, on mo- 
 tion of Mr. RUE A, 
 
 Ordered, That the consideration of the said bill be postponed till to-mor- 
 row. 
 NOTE. -No further proceedings were had upon this bill. 
 
 llthCo.NGRF.88. > 
 
 3d Session. 5 DECEMBER 18, 1810. 
 
 Mr. FINDLEY presented a petition of the stockholders of the Bank of the 
 United States, praying the renewal of their charter of incorporation, which 
 was read and ordered to be referred to a select committee; and Mr. Burwell, 
 Mr. Findley, Mr. Southard, Mr. Mitchel, Mr. Franklin, Mr. Butler, Mr. 
 J. C. Chamberlain, Mr. W. Chamberlain, Mr. Mosely, Mr. N. R. Moore, 
 Mr. Miller, Mr. Smelt, Mr. Johnson, Mr. Morrow, Mr. Jackson, Mr. Gar- 
 nett, and Mr. Poindexter, were appointed the said committee. 
 
 DECEMBER^, 1810. 
 
 Mr. LOVE offered the following resolution: 
 
 Resolved, That the Secretary of the Treasury be directed to lay before this 
 House, information, first, of the amount of debts due from individuals and 
 bodies corporate to the Bank of the United States, distinguishing the amount 
 due by bond, mortgage, or other specialty, from that payable by notes, bills 
 of exchange, or other security not under seal, to the said bank and its branches, 
 and what portion of said debts are considered as standing accommodation to 
 the customers of said bank and its branches: Second, of the amount of notes of 
 said bank and its branches, now in circulation: Thirdly, whether the revenue 
 of the United States, or what portions of it are ordered to be deposited in the 
 said bank and its branches; whether any portion of it is ordered to be depo- 
 sited in other, and if so, what other banks; and what will be the probable 
 amount of deposites in favor of the United States in any of the said banks or 
 then- branches, and which of them on the first day of March, in the year 181 1 . 
 
 The said resolution was read and ordered to lie on the table. 
 
136 BANK or THE UNITED STATES. 
 
 JANUARY 3, 1811. 
 
 The House, on motion of Mr. LOVE, proceeded to consider the preceding 
 resolution, which, being read, was agreed toby the House. 
 
 And on the 10th January, the Secretary of the Treasury communicated to 
 the House, the following answer to this call: 
 
 The Secretary of the Treasury, in obedience to a resolution of the House of 
 
 Representatives, of the 3d instant, respectfully reports:] 
 That the annexed statements, marked A, B, and C,* contain all the infor- 
 mation which the returns made to the treasury afford, on the subjects em- 
 braced by the resolution aforesaid. 
 
 It appears by the statement A, that the debts due from individuals and bo- 
 dies corporate, to the Bank of the United States, consisted, at the respective 
 dates of the several returns, of the following items, viz: 
 Bills and notes discounted, and bonds due by individuals, $15,126,187 04 
 Balance due by other banks in account, after deducting the 
 sums due by the Bank of the United States and its branches, 
 to several other banks, - 1,318,02429 
 
 Bank notes of other banks, on hand, 511,909 06 
 
 Treasury drafts not yet collected, 31,466 01 
 
 Overdrawn, 32,579 07 
 
 Converted six per cent, stock, 23,066 23 
 
 17,043,231 70 
 To which, adding the loan to the United States, - - 2,750,000 00 
 
 Makes, for the aggregate of debts due to the bank, - $19,793,231 70 
 
 In a few instances, which are noted in the statement A, the amount due on 
 bonds, and also that of notes discounted, which have been put in suit, is dis- 
 tinctly stated in the returns made to the treasury; but the aggregate alone is 
 given in most of them, and they do not, in any instance, distinguish the amount 
 " considered as standing accommodation to the customers of the bank and its 
 branches." A recurrence to the 16th regulation of the 7th section of the act 
 incorporating the bank, will show, that the only statements that can be re- 
 quired by the officer at the head of the treasury, are those of the amount of 
 the capital stock of the corporation, of the debts due to the same, of the moneys 
 deposited therein, of the notes in circulation, and of the cash in hand; and 
 that he has no right to ask for the account of any private individuals, or for 
 any other than the above mentioned general statements. Nor has the Secre- 
 tary of the Treasury any knowledge whatever of the accounts and operations 
 of the bank, but what is derived from the official statements transmitted to 
 him in conformity with the above mentioned provision in the charter. 
 
 The statement B shows the amount of notes of the said bank and its branches, 
 in circulation at the date of the latest returns, to have been $5,157,378 83. 
 
 The Treasurer's accounts, annually laid before Congress, show correctly 
 the amount of public moneys deposited in the various banks, on the last day of 
 each quarter. But that amount is daily fluctuating, and connot be stated with 
 perfect precision, except on the quarterly statements of those accounts. The 
 Treasurer furnishes, however, the Secretary of the Treasury with a weekly 
 estimate of the cash on hand, and where deposited, as taken from the latest 
 received returns. A copy of that furnished on the 7th instant, marked C, is 
 herewith transmitted, together with remarks, showing what portions of the 
 revenue are generally deposited in the Bank of the United States and its 
 branches, and what portions are deposited in other banks. 
 
 * For the said statements, see American State papers, published by Gales & Seaton, 
 vol. 2 of Finance, pages 462 and 463. 
 
* 
 
 ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 It is probable that the amount of specie in the treasury will, on the first day 
 of March next, exceed 2,500.000 dollars, and that the proportion deposited in 
 the banks, other than tliat or the United States and its branches, will not 
 materially vary from what it is at present. But it is impracticable to form 
 any correct estimate of the probable amount at that time in each place, re- 
 spectively, since that is always regulated by the want of funds in each place, 
 for the current service, according to which the public moneys are daily trans- 
 ferred by drafts, from place to place, as the occasion may require. 
 All which is respectfully submitted, 
 
 ALBERT GALL AT IN. 
 
 TREASURY DEPARTMENT, January 9, 1811. 
 
 JANUARY 4, 1811. 
 
 Mr. BURWELL, from the committee appointed on the 18th ultimo, presented 
 a bill continuing, for a further time, me charter of the Bank of the United 
 States, which was read a first and second time, and committed to a Committee 
 of the Whole House, on Monday next, as follows: 
 
 A bill continuing in force for the term of the act, entitled " An act 
 
 to incorporate the subscribers to the Hank of the United States," on th* 
 terms and conditions therein mentioned. 
 
 Be it enacted by the Senate and House of Representatives of the United 
 States of America in Congress assembled, That the act, entitled " An act to 
 incorporate the subscribers to the Bank of the United States," passed the 
 25th day of February, in the year of our Lord 1791, be, and the same is here- 
 by, continued in force, subject to the provisions and conditions in this act 
 
 specified, for, and during, the further term of years, from and after 
 
 the 4th day of March, next. 
 
 SEC. 2. Provided, however, and be it further enacted, That the president 
 and directors of the said Bank of the United States, shall, on or before the 
 
 day of next, pay into the Treasury of the United States, for the 
 
 use thereof, one million two hundred and fifty thousand dollars. 
 
 SEC. 3. And be it further enacted, That the president and directors of 
 the said bank, shall, at all times, from and after the passing of this act, and 
 during the continuance of the same, be holden and bound to make a loan or 
 loans to the United States, if required and authorized by law, of any sum or 
 sums of money, not exceeding in the whole^ at any one time, five millions of dol- 
 lars, reimbursable at the pleasure of the United States, and at a rate of inter- 
 est not exceeding six per centum per year: Provided, That it shall be the 
 duty of the Secretary of the Treasury to make his application in writing to 
 the president and directors of the said bank, for such loan or loans, at least 
 three calendar months prior to the time when such loan or loans shall be 
 required: Provided, also, That the sum of two millions and seven hundred 
 and fifty thousand dollars, borrowed during the year 1810, shall be considered 
 part thereof, and that no greater amount shall be required, in any quarter of 
 a year, than one million! of dollars. And provided, further, That all such 
 loans shall be reimbursable at or before the expiration of the said term of 
 
 years, unless it shall be otherwise agreed between the said corporation 
 
 and the United States. 
 
 SEC. 4. And be it further enacted, That if the said president and directors 
 shall, on any occasion, fail to furnish any loan or loans, to be required by the 
 United States, in the manner herein before enacted, their corporation shall 
 forthwith be dissolved, and the powers thereof shall cease and determine, any 
 thing in this act, or in the act hereby continued in force, to the contrary there- 
 of, in anywise notwithstanding. 
 
 SEC. 5. And be it further enacted, That the directors, chosen by the stock- 
 holders of the said corporation, on the first Monday of January, in the present 
 year, and the president, chosen by the directors at the first meeting after 
 18 
 
I 
 
 138 BANK OF THE UNITED STATES. 
 
 such election, shall be capable of serving, by virtue of such elections, until the 
 first Monday in January, 1812. 
 
 SEC. 6. And be it further enacted, Tliat the act, entitled " An act to punish 
 frauds committed on the Bank of the United States," passed the 24th day of 
 February, 1807, be, and the same is hereby, continued in force, during the 
 continuance of the said corporation; and the same shall at all times hereafter, 
 and in all respects, be deemed and taken to apply to the said corporation, in 
 the same manner that it has been deemed and taken to apply to the same here- 
 tofore. 
 
 SEC. 7. Jind be it further enacted, That the president and directors of 
 the said bank, shall, after the 4th day of March next, pay to the United States 
 an interest, at the rate of three per cent, per year, on all sums of money above 
 
 the sum of -.millions of dollars, which shall accumulate to the credit of 
 
 the Treasurer of the United States in said bank, or the branches of the same, 
 
 and which shall remain there for : Provided, It shall be the duty of the 
 
 Secretary ot the Treasury, from time to time, to give notice, in writing, to 
 
 the president and directors, at least days before the term, or time at 
 
 which the said interest shall begin to accrue and be computed; which notice 
 in writing, shall specify the exact amount of the deposite so to remain for the 
 whole year as aforesaid. 
 
 SKC. 8. And be it further enacted, That the United States shall be author- 
 ized, at any time during the continuance of this act, to increase the capital 
 stock of the said corporation, in manner as may be hereafter prescribed by 
 law, and for which the United States shall be the subscriber and owner, to 
 
 an amount not exceeding in the whole shares, and not exceeding in 
 
 any one year shares: Provided, That during the time the United 
 
 States shall so hold stock in the said corporation, they shall have a right to 
 appoint, in such manner as shall be hereafter declared by law, a number not 
 
 exceeding of the directors: find provided, also, That the shares thus 
 
 to be subscribed and added, by and on behalf of the United States, shall not 
 be sold at a price less than per centum advance on each share. 
 
 SEC. 9. And be it further enacted, That the twelfth section of the before 
 mentioned act, entitled " An act to incorporate the subscribers to the Bank 
 of the United States," passed March 2d, 1791, be, and the same is hereby re 
 pealed. 
 
 SEC. 10. And be it further enacted, That it shall be the duty of the presi- 
 dent and directors of the said bank, on or before the day of 
 
 next, to signify to the President of the United States, in writing, their accept- 
 ance on behalf of the said corporation, of the terms and conditions in this act 
 contained; and if they shall fail to do so, on or before the day above mention 
 ed, then this act shall cease to be in force. 
 
 JANUARY 16, 1811. 
 Mr. WRIGHT ottered the following resolution: 
 
 Resolved, That the Secretary of the Treasury be directed to lay before 
 Congress, a list of the directors of the Bank of the United States, and of the 
 several branches^ and a statement of the stock held by foreigners, and in what 
 countries; and ot the stock held by citizens, and in what States and Terrtiories. 
 
 On suggestion of Mr. EPPES, the resolution was modified by adding to the 
 information required, a statement of the specie deposited in the Bank of the 
 United States and its branches, in the States and Territories, distinguishing 
 between the deposites of the United States, and those of individuals. 
 
 As amended, the resolution was agreed to. 
 
 The House then resolved itself into a Committee of the Whole, on the bill 
 to renew the charter of the Bank of the United States, Mr. W. ALSTON in the 
 chair. 
 
 Mr. BURWELL moved to strike out the first section of the bill. 
 
 He supported his motion in a speech of great length, in which he denied 
 the constitutionality and expediency of the bill, as follows: 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. J3Q 
 
 Mr. BURWELL. 1 have made you this motion, sir, because it allows the 
 greatest latitude of discussion up'on the important points which are prelimina- 
 ry to the examination of the details. It tries the principle of the bill, and may 
 save much tedious and useless labor. Should a majority decide in favor of the 
 Bank of the United States, as an honest man, I will aul in forming a system 
 best adapted to the state of the country, and most subservient to the purposes 
 of such an institution. The gentleman from Connecticut (Mr. MOSELY) 
 has done justice to my conduct, and the fairness with which the subject has 
 been treated. I have been anxious to present the question fairly, not from 
 any <loribtor indecision as to the course I should pursue, but from its magni- 
 tude, and the sensibility it has excited. It will be recollected by the commit- 
 tee, when the gentleman from Philadelphia presented the memorial, upon 
 which the Secretary of the Treasury founded his report, on that, as on 
 all subsequent occasions, my opposition was manifested; and I will add, that 
 the particular intention which my duty has compelled me to bestow on the 
 bank, has confirmed most stongly former impression?. 
 
 The remarks I shall make, are intended to show tint Congress possesses no 
 power to incorporate a bank; to show its effect on the Government: and to 
 satisfy the committee that the exercise of the power, even if possessed, is in- 
 expedient. While, sir, I feel the most ardent desire to consult the conveni- 
 ence of the Government, and promote the prosperity of the community in 
 general, I have not lost sidit of the limits within which I am restrained by the 
 constitution of the United States, and considerations of sound policy. It is 
 my most deliberate conviction the constitution of the countiy gives no autho- 
 rity to Congress to incorporate a bank, and endow the stockholders with char- 
 tered immunities, and, even if its dissolution should produce ruin to the mer- 
 chants, and, what is of equal importance, embarrassment to the Government, 
 they would not be paramount to tin- sacred obligation of supporting the consti- 
 tution, though I am persuaded the dreadful evils which have been predicted 
 from the annihilation of the bank, will soon vanish, and that no material shock 
 will be produced by that cause. The construction which the constitution has 
 received by the various persons -,\ ho have, at different times, administered it, 
 has been rigid or liberal, according to their confidence in the General or State 
 Governments. The unqualified extent given to its general powers, and the 
 inclusion of incidental powers, as flowing from, and belonging to, particular 
 enumerated grants, have constituted the essential points of difference among 
 those who have divided upon the principles of the constitution: this has been 
 the case, not. only in the exercise of authority when the right was question- 
 able, but in cases where the right was undeniable, tending, by its operation, 
 to increase the weight of the General Government. In giving to the constitu- 
 tion that rigid construction which sound policy requires, a just regard to the 
 harmony of the States, and the perpetuation of their Union dictates, I cannot 
 find any part of it authorising the exercise of a power, which, from its nature, 
 is obnoxious, its tendency alarming, and its influence in the hands of those 
 who manage its concerns, irresistible. The power to establish a bank, cannot 
 be deduced from the general phrases " to provide for the common defence and 
 general welfare," because they merely announce the object for which the Ge- 
 neral Government was instituted; the only means by which this object is to 
 be attained, are specifically enumerated in the constitution, and if they are 
 not ample, it is a defect which Congress are incompetent to supply. I think 
 this inference the stronger, inasmuch as those means were granted to us by 
 those who had acted under the confederation, and experienced its defects, and 
 knew precisely to what extent power was requisite to provide for the com- 
 mon defence and general vyelfare. In relation to this particular subject, the 
 proceedings of the convention itself, furnish the plainest evidence, by reject- 
 ing the proposition to vest in Congress the right to grant incorporations. I 
 readily admit the motive of deliberative bodies cannot always be known; va- 
 rious considerations might have operated; they might have supposed the power 
 already vested; but it is incumbent on those who can place faith in an inter- 
 
140 BANK OF THE UNITED STATES. 
 
 pretation so repugnant to the cautious and guarded phraseology of the instru- 
 ment, to demonstrate it. If the right to incorporate exists, it is a general grant 
 of power, equally applicable to all the objects of incorporations, and cannot 
 be assumed as a means to carry into effect any particular grant of authority. 
 To my mind it is much more natural to suppose a power to create monopolies 
 had been surrendered to quiet the fears ol those who saw in the constitution 
 the germ which would, sooner or later, palsy the vitals of the State authority. 
 If the general phrases are not explained in the manner just mentioned, and 
 powers so extensive and important are derived from them, it would be ridicu- 
 lous to consider the jurisdiction of Congress restricted,' they would confer 
 equal authority to establish monopolies in all the various branches of indi- 
 vidual industry and commercial enterprise. Sir, I will conclude this part of 
 the subject by reminding you how essential it is, when we are giving an inter- 
 pretation to the constitution to which the States are parties, to assume only 
 what clearly belongs to us; moderation will inspire confidence, selfishness will 
 excite disgust and suspicion. 
 
 The parts of the constitution which bear any analogy to this subject, are, 
 
 1st. Congress shall have power to lay and collect taxes, duties, imposts, and 
 excises,- to pay the debts, and provide for the common defence and general 
 welfare, &c, 
 
 2d. To borrow money on the credit of the United States. 
 
 3d. To regulate commerce with foreign nations, and among the several 
 States, and with Indian tribes. And, 4th. To make all laws which shall be- 
 necessary and proper to carry the foregoing powers, and all other powers vest- 
 ed by the constitution in the General Government, into effect It will not be 
 denied, that, if the establishment of a bank comes within the meaning of the 
 power to lay and collect taxes, to pay the debts of the United States, and to 
 regulate commerce, or is necessary and proper to carry the foregoing powers 
 into effect, it would be a fair subject for legislation by Congress. But can any 
 one pretend, that a bank would be a mode, contemplated by the constitution, 
 to lay and collect taxes on the people, for the purpose of raising revenue r 
 Would it comport with that wise principle of uniformity, and those guarded 
 restrictions against unequal burthens on the people, which constitute the most 
 valuable safeguard to the citizen ? To understand these terms, we must give 
 them a meaning which has been affixed by their usual import. When we 
 speak of the power to lay taxes, we understand by it, a demand of money from 
 the community, regulated by fixed and equitable principles, indiscriminate as 
 to persons, and the species of property taxed. To suppose that every law 
 which imposed burthens, or brought money into the treasury, was constitu- 
 tional, would destroy our equal system of Government, and substitute a ca- 
 pricious despotism. It would revive the exploded doctrine of free gifts, be- 
 nevolences, and that shameful train of extortions practised by the old govern- 
 ments of Europe. Does it fall within the power to pay the debts of the Unit- 
 ed States ? This clause relates entirely to the application of the funds, after 
 they have been accumulated; it is in conformity with that article which pledges 
 the public faith for debts which had been contracted, as well as those which 
 might be created in pursuance of the authority to borrow money upon the faith 
 of the United States. If the power to incorporate a bank, grew out of the ob- 
 ligation to pay the debts of the United States, its charter should be so worded 
 as to cease whenever they were extinguished; and it would be no longer for 
 Congress to fix a definite period for its expiration. If the right of incorpora- 
 tion was ever meant to be given, it would most naturally follow from the regu- 
 lation of commerce; yet no one has contended Congress could create insu- 
 rance companies within the States. Those who contend the bank is constitu- 
 tional, consider it as necessary and proper in collecting the revenue. That it 
 may be an useful instrument, I do not deny; it forms depositories convenient 
 to the Government; but you should recollect, depositories, equally safe and 
 convenient, can be procured without being purchased at the expense of exor- 
 bitant and invidious privileges, to a particular class in the community. I ap- 
 prehend the constitution means something extremely different. When it em- 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 powers the General Government to collect taxes, it relates exclusively to the 
 authority thus given to Congress, of employing compulsory process, in coerc- 
 ing the payment of taxes; it enables Congress to create, within the jurisdic- 
 tion of the States, officers of the revenue, and through them, to exercise over 
 the persons and property of the citizens, a concurrent jurisdiction, from which 
 they otherwise would be precluded, and from whicli they had been precluded 
 before the adoption of the constitution; it enables them to impose penalties 
 and forfeitures, and to inflict punishment lor resistance to their authority. 
 But, sir, admit fora moment tlie bank may be formed to collect the revenue; 
 ought it not to be exclusively used for that object? Whence the power to make 
 it an instrument of commerce ? Why invest it with a capital, immense in 
 amount, and sovereign in its control over the external and internal commerce 
 of the country ? Sir, I must again call your attention to the limited nature of 
 our Government; we must administer it as we find it, and not as we think it 
 ought to be. Under this view of the subject, so long as I understand the right. 
 to * 4 lay taxes," to consist in drawing supplies from the people for public 
 purposes, and not to tax one portion for the benefit of another; and fci to col- 
 lect'" them, the right to enforce payment; I cannot construe them to authorize 
 the establishment'of a bank. Sir, a bank has been improperly considered a 
 means of executing some power expressly given to Congress. The nature of 
 incorporations is so clearly a distinct class of political power, that, before they 
 can be converted into means incidental to an object, without the jurisdiction 
 of the General Government, they must be shown to be absolutely necessary. 
 Permit me to ask how has it been ascertained th;it a bank is necessary to the 
 operations of the Goverement? Has the experiment been tried? Upon a 
 question involving a breach of the constitution, it would be safer to be guided 
 by experience than conjecture. 
 
 Sir, I am well aware that 1 can add nothing new upon the constitutional 
 points. This subject was more thoroughly examined in 1791, and more ably 
 elucidated than anv other since the adoption of the Government. The cele- 
 brated speech of Mr. Madison, to which 1 ascribe my conviction, has been re- 
 cently presented to us in the newspapers, and gentlemen must be familiar 
 with it. I cannot give additional weight to the arguments, 1 but I thought it 
 proper to call the attention of the committee to that part of the subject, by the 
 remarks I have made. 
 
 I said, sir, it must be shown that the bank is necessary to the operations of 
 the Government; without its aid our fiscal concerns cannot be managed. So 
 far from subscribing to the necessity of the bank, I believe the revenue would 
 be equally safe in the State hunks and could be distributed with inconsider- 
 able difficulty; the revenue received in most of the States is nearly equal to 
 the expenditure within them, and when a deficiency occurred in any one, it 
 could be supplied by arrangements with the different banks, by transportation 
 or inland bills of exchange, in the same manner that the public engagements 
 are fulfilled abroad. I will venture to assert, the Secretary of the Treasury 
 will find no difficulty in contracting with individuals and corporate institu- 
 tions, upon the most ample security, to transfer the public revenue, upon 
 terms equally advantageous to the United States. Among the several States 
 commercial intercourse is great, arid daily increasing; the constant traffic 
 which the different portions of the country maintain with one another, will 
 give facility to the operations of the Government; and obviate the obstacles 
 which are anticipated. The very commerce which enables the treasury to 
 remit, with ease, immense sums to every part of Europe, is the result of this 
 interchange among the States, and insures equal facility at home: where, then, 
 is the necessity for this bank? The accommodation of the bank to the Govern- 
 ment, in times of emergency, and the use of its resources to support public 
 credit, have been urged as motives for its establishment: how far such con- 
 siderations weaken constitutional objections, it is needless to state. If, sir, 
 the bank becomes a source of supply to the Government, to an adequate ex- 
 tent, it ceases to be one to the merchants. It, therefore, cannot answer in 
 both capacities. The same necessity which throws the Government upon the 
 
142 BANK OF THE UNITED STATES. 
 
 chanty of the banks, renders it incapable of discharging the obligation, and 
 while the funds of the institution are locked up in the Government, its com- 
 mercial functions must cease. The relief which sudden and temporary em- 
 barrassments require, can, at all times, be administered by the State banks, 
 and, therefore, supersedes the necessity of aid from this bank. Whenever, 
 by disasters, the ordinary sources of supply are exhausted, or the unavoidable 
 objects of expenditure exceed the revenue, a more copious and permanent 
 aliment will be found in the wealth and capital of the citizens than by loans 
 from banks. Instead of diverting the active and productive capital from use- 
 ful channels, the sluggish and inert mass will be drawn forth, in its aid, to 
 support public credit, and cherish private enterprise. But, sir. is it prudent 
 to rely upon an institution that may refuse you assistance? What will be the 
 influence of such an institution on the Government and the country at large? 
 It cannot escape your recollection, that the establishment of the Bank of the 
 United States was the origin of a system which assumed, as its basis, the en- 
 largement of the national jurisdiction. Whether the principles of expediency 
 to which it owes its birth be regarded, or the overweening influence it esta- 
 blished over the moneyed institutions and merchants of the States, the charge, 
 to say the least, is plausible. The close and intimate connexion between the 
 Government and the bank; the dependence of the former for loans, and the 
 latter for public deposited, have given the Executive branch its full share of 
 influence and odium, shows incontestibly it was created to augment the power 
 of the General Government, and the Executive in particular. Yes, sir, it was 
 the commencement of those political animosities which have poisoned the 
 sources of social intercourse; it was the origin of that doctrine of constructive 
 power which abrogates the constitution, and nullifies the restrictions imposed 
 upon Congress. So long as it exists, the body politic will experience the agita- 
 tions ami convulsive throes of well grounded jealousy in the States. 
 
 Sir, in the administration of this Government, two things alone are neces- 
 sary to ensure its durability. You must, 1st, avoid every measure which will 
 produce uneasiness among 'the States; or, 3d, that will extend the jurisdiction 
 of the United States Government to subjects purely local. I do not mean that 
 the rightful authority of Congress is to be abandoned for fear of giving offence; 
 but whenever called on to take a step which will produce uneasiness, you 
 should be perfectly satisfied the letter and spirit of the constitution bear you 
 out. Do not gentlemen perceive the tendency of this measure to involve us 
 with the States upon delicate points? Has not the United States Bank pro- 
 duced serious alarm? Will not the alarm be increased by its continuance at 
 this time? Yes, sir, some of the States have already taxed this institution, 
 others have waited under the expectation we shall render a collision unneces- 
 sary. Suppose the charter renewed, and the stockholders should be taxed in 
 such a manner as to destroy, virtually, the privileges you have guaranteed to 
 them? Are you to leave them unprotected, or will you draw the sword in 
 their behalf? While you have time, avoid a situation not less perilous than 
 the most serious foreign war. Since the establishment of the bank, the States 
 have created banks; their people have accumulated capital, and they will not 
 tamely witness the perpetuation of an institution whose strength can, at any 
 moment, overthrow whatever State bank they may mark for destruction. 
 However paradoxical it may appear, I consider the General Government 
 strengthened by narrowing its jurisdiction: it will produce disunion whenever 
 they interfere with local concerns. The habits, local interests, and passions 
 of this country vary, and no one is a competent judge of what will suit the 
 feelings of the State out of which he lives. But, sir, there are general princi- 
 ples in which our feelings and interests are identified. These are subjects 
 upon which we may safely act, and trust to the co-operation of every man 
 and State in the Union. 'Does the bank affect the people locally? The an- 
 swer is obvious: itnot only undertakes to fix the amount of capital, but inter- 
 feres with the rights of property most essentially. It may change the funda- 
 mental principles of State law as to the liability of property for debts, and 
 the mode of recovering them. Let me caution you against the renewal of the 
 
t 
 
 ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 charter; it is pregnant with the most baneful consequences to the trarrquiiity of 
 the country. Is it not better to sacrifice this golden calf upon the altar of con- 
 cord, restore confidence and harmony among individuals as well as States, 
 and to reunite the lovers of the constitution. 
 
 In the report of the Secretary of the Treasury, the convenience of obtaining 
 loans from the bank is mentioned as an inducement to establish a national 
 bank. To me, the abuse of this convenience is more dreaded than any other 
 evil which will follow from the measure. Where have you seen a national 
 bank, connected with the government, which has not ultimately ruined the 
 circulating medium of the nation? It is a notorious fact, that money has de- 
 preciated seriously from the unlimited circulation of paper, and, if the Govern- 
 ment should be compelled, by necessity, to use the funds of the bank, they 
 must permit the increased circulation of its paper, although its money capital 
 remains stationary. In this situation, the Government must tolerate an oper- 
 ation which will increase the evil of which we complain. The example of 
 England is a salutary monition to us, and we ought to profit from it. In that 
 country, there was a time when the stability of the bank was a national phrase, 
 " as good as the Bank of England/' How is it now? The funds of the bank 
 have been borrowed by the Government ? its paper circulation increased, and 
 Parliament has been compelled to make it a tender for the payment of all con- 
 tracts. Who, sir : can estimate the complicated mischiefs of a depreciated 
 paper currency, without specie for its redemption? Should we be involved 
 in war, or our property seized abroad, nothing can prevent universal bank- 
 ruptcy; one wide spread ruin will pervade the continent. At this time the 
 country is inundated with paper, bottomed upon the whole floating and real 
 property of the community: should an alarm exist, can these funds be con- 
 verted into money to redeem its credit? Certainly not. Will it not be pru- 
 dent to diminish the extent of this evil by putting down this bunk, which is the 
 fountain from which the whole system Hows? li is of little importance, as it 
 regards the internal trade of a country, what constitutes the representation of 
 property. Paper, iron, or any thing else which passes current, will answer 
 every purpose of barter and trade: but, in its commerce abroad, it is indispen- 
 sable that the circulating medium should be equally valuable, and readily ac- 
 knowledged among all commercial nations: otherwise, all the operations of 
 commerce, carried on with money, will be abandoned, or prosecuted under 
 disadvantages equal to the difference in the value of the currency at home and 
 abroad. In countries actively engaged in business, this branch of trade is not 
 only great in amount, but by far the most profitable. How unwise, therefore, 
 not only to substitute for the precious metals paper currency, whose value is 
 confined to the United States, but to augment the quantity until it depreciates 
 even among ourselves. 
 
 I cannot sufficiently express my apprehension at a state of things which ex- 
 poses us to irreparable injury, whenever a foreign nation shall interrupt our 
 commerce, or my regret at the daily ascendency of this fatal policy. In my 
 opinion, sir, the true corrective will be applied, if the Government, instead of 
 receiving the paper of a particular bank in payment lor the revenue, shall re- 
 quire specie as the only tender. Such an operation would secure to the coun- 
 try its due proportion of the precious metals, would restrain within rational 
 and useful limits, the circulation of paper, would insure stability to the mo- 
 neyed institutions, save the people from the dreadful scene of bank swind- 
 ling which is exhibited, and restore that equality of trade with foreign nations, 
 which depends upon the fixed value of the circulating medium. I am far 
 from intimating that banks are useless, when established with a due regard to 
 the actual wants of the country. Measured by that standard, they form the 
 chief resource of industry, lubricate the wheels of commerce, and accelerate 
 their motion but the constitution has wisely entrusted this measurement to 
 the States; they are the most competent judges. If the Bank of the United 
 States tended to restrain the multiplication of banks, and the ruinous emis- 
 sion of paper, I acknowledge it would be a powerful argument in its favor 
 it would go far to satisfy me of its expediency. But, instead of producing 
 
I 
 
 144 BANK OF THE UNITED STATES. 
 
 this effect, we have seen them, like mushrooms hi a genial soil, spring up un- 
 der its fostering protection. The Bank of the United States has an interest 
 in the multiplication of similar institutions, because they all tend to secure it 
 from danger, and enable it to increase the discounts to the greatest amount. 
 Before the United States Bank can be affected, all the other banks must be 
 ruined; because the advantage of public deposites and the great extent of ca- 
 pital, will afford the means of averting the storm. What has been the fact 
 upon this subject? Have not the most shameful systems of bank swindling 
 been practised? The State of Massachusetts found it necessary either to sup- 
 press her banks or limit their discounts. They found, upon examining trie 
 vaults of the banks, the whole of them did not contain specie equal to the 
 paper issued by a single one. Yes, sir, instead of finding a sound body, they 
 found a corpse rotten and decayed; the specie had fled, and the public were 
 left without the prospect of remuneration. Have you forgotten the Bank of 
 Rhode Island? This bank had issued notes to the amount of $800,000 upon a 
 capital of $45. Will gentlemen tell me, the Bank of the United States has 
 checked, or will keep down in future, similar impositions? I am justified in 
 considering tin's bank instrumental in depreciating the currency of the coun- 
 try, and banishing its substantial capital. 
 
 There is no branch of industry more materially injured by the artificial 
 state of f credit, and the depreciated currency of the country, than manufac- 
 tures. The precarious condition of commerce has naturally turned the public 
 attention to this subject; and we may hope the time is not distant, when the 
 United States will furnish the articles of substantial utility for themselves. 
 The war in Europe, by deranging the operations of <he manufacturer, and the 
 taxes with which his industry has been burthened, have conspired to give a 
 vigorous impulse to them here. But, sir, we shall probably witness their de- 
 struction, by the rapid depreciation of paper, which arises from the price of 
 labor, and impedes the accomplishment oi this most desirable object. The 
 exchange of labor between the inhabitants of America and the old world, has 
 -always been disadvantageous. We have not only paid'full profits upon the 
 capital and labor employed in the production of what is consumed, but we 
 have paid the taxes which the prodigal Governments of Europe have laid upon 
 them. 
 
 Upon this subject a strong appeal has been made to our feelings; it has been 
 said the dissolution of the bank will produce the most serious pressure in the 
 community, and will devote numbers to ruin. I am confident no man would 
 be more gratified than myself, to afford relief to those who may suffer, if I was 
 not precluded by constitutional difficulties. \Vhile I admit the sufferings of 
 individuals will be great, I am equally convinced the picture is highly color- 
 ed, and the facts exaggerated. 
 
 The time when the charter expires has been known to every person; the 
 presumption against its renewal, strong. How can you, therefore, believe the 
 creditors of the bank have made no provision to meet the event? It is scarcely 
 possible to conceive that funds have not been provided to extricate themselves. 
 When I say the presumption against the renewal of the charter has been 
 strong, I do not allude so much to the sentiment in this House, as to the so- 
 lemn declaration of the President of its unconstitutionality. 
 
 [Mr. Macon called Mr. Bunvell to order, for using- the name of the President in 
 debate.] 
 
 Sir, the violation of order has been inadvertently committed; his name was 
 not used to produce any effect here, because I really am unacquainted with 
 his present opinions, except as I infer them from his speech in '91. I cannot 
 suppose he would use one set of arguments then, and act upon another now. 
 
 Under such circumstances, it would be criminal in this House to yield con- 
 stitutional objections, and surrender important considerations of policy, to 
 shelter those who have shut their eyes to the law. The Legislature cannot 
 resist with too much firmness such an appeal; it is placing them at the mercy 
 of a few, and sacrificing the general good to the clamors or follies of the im 
 provident. 
 

 ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 It has been said that $3,000,000 in specie will be required from circula- 
 tion, to meet the demands of the bank, and that the amount cannot be 
 procured in the United States. I venture to assert, upon the statement 
 furnished by the bank agents, the sum will not exceed $2,500,000 over 
 and above the specie in the vaults of the bank. After paying and settling 
 with the community, the bank will owe to the stockholders $10,400,000. 
 If they retain the specie now in the vaults, amounting to $5,000,000, the de- 
 mand upon the community will IKS lessened to that extent; if it is paid out to 
 meet the return of their notes in circulation, it passes into other banks and 
 will return to them: so that in either case it will constitute a fund to pay the 
 stockholders, and reduce their demand to $5,400,000; from this sum must be 
 deducted $500,000, the amount of real estate belonging to the corporation, 
 $2,750,000 loaned to the Government, and about $300,000 in suit; leaving a 
 balance not exceeding $2,500,000. Will it be said that this sum cannot be 
 raised in a country whose export of specie for the last year amounted to 
 $8,000,000? Will it be said the system of banks has reduced us to this low 
 ebb, and yet we are called upon to perpetuate the evil? From this view of the 
 subject, it appears that the creditors of the bank will be compelled to raise 
 $7,500,000. 
 
 Can gentlemen seriously believe, that this sum will ruin the country? If, 
 sir, we judge from the number of banks springing into existence, in the differ- 
 ent States, the conclusion is irresistible, that their is a redundancy of capital, 
 more than ample to accommodate all the debtors of the bank. Scarcely a 
 single legislature has separated, without granting charters. You have this 
 morning, deposited in Committee of Ae Whole, the cemetry for the District, 
 live banks, with an aggregate capital of three and an half millions. This 
 thing must be downright cheaiery. or their is a redundancy of capital. If it is 
 fraudulent, the sooner the delusion is dissipated, the better. 
 
 I shall, for the present, admit these applications are evidences of capital, and 
 contend they will operate effectually to relieve the community. But, sir, it 
 will be found, from the statement of the bank agents, the directors have con- 
 tracted debts, nearly, or quite equal to the amount ilue them, and that they 
 will find difficulty in meeting the claims against them. These claims will na- 
 turally be transferred to those who are indebted, or deposited in State banks, 
 where they will constitute funds, upon which accommodation can be extended. 
 The moment you destroy the bank, the notes it has issued, to the amount of 
 $5,000,000, will return: the deposited, amounting to nearly eight millions and 
 an half, will come into the market; these, added to the private capital which 
 tan be spared, will supply the means of sustaining the shock. 
 
 1 feel confident the removal of public deposites will go far to remedy the 
 evil- The loan obtained from (he bank, and payable the 1st of January, will 
 add to the facility of satisfying the claims of the bank. Even the funds of the 
 institution itself, will rapidly glide into channels of profit, and contribute to 
 the object. Thus, sir, this omnipotent association, whose influence pervades 
 the continent; whose nod dispenses protection, or ruin, like an angry cloud, 
 will be disarmed by the conducting powers of the State banks; there will be no 
 explosion. Its substance will be secreted, mixed with their juices and strength- 
 en the general system, 
 
 In the public discussions upon this subject, we have been told, the quantity 
 ot specie has been reduced below the actual wants of trade; and that the por- 
 tion of stock held by foreigners, will be carried abroad in money. Those who 
 endeavor to alarm us in this way, are either ignorant themselves, or they cal- 
 culate largely upon our credulity. It is, sir, a melancholy fact, that specie has 
 been almost banished from circulation, by paper, and from the vaults of the 
 banks by exportation* abroad, in a commerce which does not replace it. It is 
 equally true, that this bank has contributed, more than any other, to produce 
 this deplorable result. But it is evident, the exportation must be limited in 
 amount, or the import of specie commensurate, if we do not continue the pre- 
 sent system, which threatens us with a cunvncy exclusively paper. 
 19 
 
146 BANK OF THK UNITED STATKS. 
 
 As to the exportation of specie, by the foreign stockholders, nothing can be 
 more absurd. Have not the motives which induced them to invest their 
 
 than I do, if you suppose they will quit a country whose institutions are safe, 
 and whose property is advancing rapidly in value. But, laying aside conside- 
 rations which, of themselves, are sufficient pledges, the rate of exchange ren- 
 ders the remittance of specie, particularly silver, altogether improbable. 
 VVpuW any man in his senses ship specie to England, when he can purchase 
 bills of exchange, eight or ten per cent, below par? Will he lose four per 
 cent, insurance, freight, and commissions, when he can make eight or ten by 
 remittances in bills of exchange? These questions carry conviction to every 
 man, unless he supposes money is worth more than this difference over the 
 paper currency of the country. Although the exchange is in favor of Holland, 
 four per cent, it would be cheaper to lose that amount, than pay fifteen or 
 twenty per cent, insurance, &c. for the transportation of specie, subject to 
 risk from British cruisers, and seizure from French rulers in port. No 
 one will say that the Dutch have any motives to draw their funds from the 
 United States. 
 
 After showing, I hope to your satisfaction, that specie, cannot be remitted 
 in the actual state of things, I will suppose foreign stockholders should trans- 
 fer their capital; how would that operation affect this country? From what 
 I have said, it appears that the one million held in Holland, and six millions in 
 England, if withdrawn from the United States, would only be an exchage of 
 funds with the American merchant, and would not affect the money in circu- 
 lation. I confidently believe, the present embarrassments of merchants arise 
 from the spoliations of the belligerents, and principally from the accumulation 
 of funds in England, which they cannot withdraw but at a great loss. For 
 some time past shipments have been almost confined to England; the prices 
 have been goad, and the proceeds far above the demand for English merchan- 
 dise; added to this, whenever shipments have been made elsewhere, the 
 profitable purchases of bills have increased their funds in Great Britain. 
 
 The fact is clearly demonstrated from the state of exchange, which, for 
 the first time, is greatly in our favor. If, then, the stockholders should remit 
 their funds by bills of exchange, it would bring six millions into the market, 
 and not only relieve the American merchant from the unfavorable state of ex- 
 change, but would at once furnish the means of meeting his engagements and 
 relieving his embarrassments: it would be a loss of that much capital to the 
 United States; but, we can bear the loss, as is evident from the rapidity with 
 which new capital is supplied to form new banks. Should they give a prefer- 
 ence to moneyed institutions here, the community would be equally relieved. 
 
 It may be asked, if foreign capital remains, shall we not be exposed to its 
 influence? I do not, sir, object to the use of foreign capital by individuals, but 
 I never will consent to organize it under the patronage of the Government. In 
 the hands of an individual^ its influence is comparatively insignificant. Com- 
 bined in the form of a national bank, it becomes truly formidable to the best 
 interests of the nation; besides,! well know that individuals, who can obtain 
 money at an interest less than the profit it yields, cannot be prevented by 
 law from borrowing. In this form, it may subserve the purposes of industry, 
 but cannot control public opinion, or obstruct public measures. If, sir, the 
 pressure upon the community should not be removed in the mode I have sug- 
 gested, the bank will naturally proceed in the collection of its debts, in a man- 
 ner best calculated to secure itself. I cannot imagine, measures will be adopt- 
 ed which will force the merchants, either to fail, or to re fuse payment. Such 
 conduct on the part of the bank, would be wantonly cruel and unjust, and 
 would probably terminate in the greatest losses. In the event of such a pro- 
 cedure, the merchants would compel the bank to resort to the ordinary course 
 for the recovery of debts, and. under such circumstances, 1 do not apprehend 
 their credit would be affected with other banks. The alarming scarcity of 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 specie, produced by the facility which the bank has furnished, to procure it 
 for exportation, and speculations in bills sold by the agents of the British for 
 the use of their troops in Canada, and the West Indies, cannot be too strong- 
 ly impressed on the mind of the committee, or too soon stopped by the Govern- 
 ment. It is true, that a temporary inconvenience results from the latter mode 
 of exportation, because it is soon brought back in return tor provisions, suppli- 
 ed by the Middle States. It must be known, sir, to you, why the import of 
 specie, which nurtured the East India trade, has ceased, since the revolution 
 in Spanish America, which opened the direct trade to the English for supplies 
 of British and East India manufactures, and the facility of shipping specie 
 direct to Spain, without the intervention of bills of exchange obtained in this 
 country, on Europe, the supply of American produce to the Spanish colonies, 
 has never been more than sufficient to keep up the necessary quantity for out- 
 own use, and for the India trade, to an extent limited by our own wants; 
 hence, the disadvantages of the napcr system, which furnishes the means of 
 prosecuting this trade after its utility is done a way. Gentlemen will tell me 
 tins evil will correct itself, and that the merchants will not persist in a branch 
 of business, unprofitable for want of markets. I readily admit this position 
 to be correct; but, before all those sanguine adventurers will be convinced, 
 who are tempted by the accommodation of the bank, we shall be so far drained 
 of our real capital, as to be incapable of sustaining public confidence, in the. 
 stability of our money institutions. There is one effect, from the extent 
 to winch the banking system has been pushed in this country, which deserves 
 serious attention. I think the capital of the banks should rather fall short, 
 than exceed the demand of those engaged in trade; whenever there is an excess 
 of capital, the competition will be among the banks to lend, and they will ad- 
 vance funds to those who are not entitled to credit. This tictitious credit, 
 '/tvon to individuals without properly, will expose the fanners and planters to the 
 most serious injury 5 because, whenever they fail, their property will go entire- 
 ly into the cotters of the bank, or the hands of their endorsers. In Baltimore, 
 where the bank capital lias always exceeded the demand, by solvent custom- 
 ers, and where, to give full employment to their funds, the banks have, been 
 induced to accommodate mere speculators; failures have happened to the 
 amount of a million, without property to pay the creditors twenty cents in the*, 
 dollar. This has been the effect of excessive bank capital. [A gentleman 
 from Maryland corrected Mr. Burwell, by stating that the failures had ex- 
 ceeded, ii the a.nsivgate, the sum he had mentioned, but in no single instance, 
 had the loss to rrednors exceeded 600,000 dollars.] [ stand corrected; only 
 600,000 dollars; why, sir, this moderate sum would ruin a whole country, if 
 it had fallen upon the farmers. If the apprehensions of the public should co- 
 erce you to renew the charter at this time, I shall consider it perpetual. The 
 same means which secured it now, will not be forgotten, or neglected, hereaf- 
 ter. You may rest assured, the magic terror of bankruptcy will be reviv- 
 ed, when there is occasion. Perhaps the growing wealth of the people, may 
 hereafter raise them above the control of the bank, with ten millions capital, 
 but if you should unfortunately adopt the favorite project of some, to establish 
 a grand national bank, with a capital stock equal to 30,000,000 dollars; if, 
 afterwards, you keep pace with the growth of the nation, you may indeed de- 
 spair of all control over it in future. It will become so interwoven with the 
 fiscal transactions of society, and so intimately blended with the existence of 
 the Government, that their duration will be co-equal; the dangerous power of 
 a bank, extended over the continent, with a capita! which would necessarily 
 embrace in its funds, all the individuals of wealth and influence, would pro- 
 duce the same effect with a national debt, to that amount; and when you re- 
 collect, that this machine will be controlled and managed by the executive 
 branch of the Government, you cannot but feel the most serious apprehension 
 of the consequences. Sir, I do not discuss this question with party feelings; 
 I look forward to the time when the bank and Government, will feel in unison, 
 and act in concert; the opposition of the bank is temporary, and will soon 
 yield t > its obvious interest. It is that period to which my fears arQ Directed.. 
 
BANK OF THE UNITED STATES. 
 
 Who can doubt (hut the present misunderstanding is the result of momentary 
 csuses? Yes, sir, the quarrel is an- unnatural one, explanations will take 
 place, reconciliation will ensue, and then we may deplore their intimate friend- 
 ship, infinitely more than their hostility now. 
 
 Banks are commercial institutions; the first impulse of their nature is to 
 make money, and support the power which can promote their profits; the 
 individuals concerned in them will feel political passions, and may indulge 
 them, but they will learn, from experience, the wisdom of suppressing their 
 passions when they hazard the loss of profit and patronage. 1 have, there- 
 fore, felt no disposition to know any thing about the directors, or to hear the 
 instances of political intolerance and individual favoritism. It would be silly 
 to found our views of the tendency of such an institution upon its conduct 
 during a particular period. I am against giving any set of men such exorbi- 
 tant power over the persons and property of the community; I am opposed to 
 a moneyed aristocracy which can hunt down whoever may be offensive to them, 
 and riot from hostility to the particular persons who now compose the bank. 
 Sir, the time may arrive when the Government may fall into the hands of 
 men whose policy may, in my estimation, lead to the destruction of the con- 
 stitution, and the corruption of public virtue. Would you wish to see such 
 men bolstered up by the influence of a national bank? Would you be satis- 
 fied to see the good sense of the country hood-winked by money influence? 
 A corporation, possessed of such ample funds, could control presses or esta- 
 blish them to support the most iniquitous men, and advocate the most detesta- 
 ble principles. You should bear in mind that this influence cuts both ways; 
 and it is better to leave public opinion unfettered, trusting to the sound sense 
 and discretion of the People, free from the operation of all extraneous power. 
 
 What would the world say if you should demolish this bank to create ano- 
 ther? Is there a man in the community who would not condemn you, and 
 justly reprobate a policy so short sighted and selfish? Such conduct would 
 give full scope to swindling and speculation; and scenes which stain with 
 shame the history of this Republic, would be renewed. Sir, the system of 
 paper credit, against which I have entered my protest, and to which I attri- 
 bute the artificial and insecure state of this country, deserves nothing from 
 you. You need not violate the constitution to preserve and extend it; with- 
 out your fostering care, enough vyill remain to alarm those who prefer solid 
 wealth to the mere appearance of it; although those who think the wealth of 
 a nation can be augmented by printing a few reams of paper will be dissatis- 
 fied, they exult in the deception and premature prosperity which flows from 
 public delusion, and will be overthrown the first moment your real condition 
 may be tested by difficulties. I, sir, have been accustomed to think the 
 wealth of a nation consisted in its productive labor, and its capital could be 
 safely augmented only in the ratio of the difference between its consumption 
 and productive labor. This is the true mode of acquiring capital; the process 
 will be slow, but the advance will be permanent. It will depend upon prin- 
 ciples of economy, industry, and steady exertions; it is incompatible with 
 prodigality, speculation, and profligate acquisition of wealth. Virtue is the 
 basis of one, delusion and imposture of the other; a people thus situated, 
 steadily exerting its powers, will furnish ample means to procure circulating 
 medium, and prudent habits will add to it with sufficient rapidity; I have 
 always preferred being a happy to a splendid nation. Sir, I have now closed 
 my remarks; the particular situation assigned to me, by the House, in rela- 
 tion to this subject, has compelled me to state the extent of my objections to 
 the bill. I have carefully refrained from expressions which could wound the 
 feelings, or impeach the motives of those who differ from me in opinion. I 
 have no disposition to say any thing about the transactions of the bank; they 
 are all unknown to me, and I care nothing about them. My conscientious 
 belief is, that the law was unconstitutional, and I sincerely trust we shall 
 destroy what has so long defaced its original purity close up the breach 
 which has been made, and cement it by a vote upon principle. I confess the 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 consolation I shall feel, in the success of my motion, will be greatly diminish- 
 ed if it obtains by the intervention of other motives. 
 
 When he concluded, the committee rose and reported progress, and the 
 House adjourned. 
 
 JANUARY 17, 1811. 
 
 Same question depending: 
 
 Mr. FISK. Mr. Chairman: I regret that we arc called upon to vote for or 
 against striking out the first section of this bill, at this time. I could have 
 wished that, upon a bill of so much interest and importance, we could have 
 proceeded to have filled the blanks, and made such amendments, as would 
 have obviated many objections which may be urged against it in its present 
 form. I am not prepared to give my vote in favor of a renewal of the charter of 
 the Bank of the United States, either upon the terms upon which it was ori 
 ginally granted, or in the manner contemplated by this bill; .vet, upon condi- 
 tions less objectionable. I should feel myself bound to vote in favor of a re- 
 newal. But the question presented unon this motion is not upon what . term> 
 this charter shall be renewed; but wnether it shall be renewed upon any 
 terms, subject to any conditions Congress may impose. 
 
 In this view, I consider it the most important subject upon which this Con- 
 gress will be required to act. It is determining a question, which is connected 
 with our finances, with the circulating medium of the country, and with our 
 agricultural, commercial, and manufacturing interests; and, as such, it cannot 
 but be interesting to eveiy cla of our citizen>. 
 
 The interests and prosperity of the Tinted States, are not only intimately, 
 but inseparably, connected with trade. The market of the farmer depends 
 greatly upon the merchant and the shipper. And the price and demand of 
 every article of produce i^in a great degree, regulated by the difficulties or fa- 
 cilities of payment. Let the difficult? of paving be increased, and the price 
 of produce immediately falls; tor the demand for exportation becomes very 
 limited, the markets are overstocked, and prices reduced. Any .sudden 
 check to our commerce, \\hether produced by our own municipal regulations, 
 or the outrages of foreign power.-, checks the market and the price of produce, 
 so that not only the merchants, but the farmers, feel its effects. 1 scarcely 
 need recur to the history of the times, \\hen trade was principally Appended 
 in this country, to show how severely the suspension operated upon every 
 class of our citizens and in every part of the country. This period in our 
 political annals will be long remembered. So great was the distress in some 
 States, and agricultural States too, that their legislatures deeded it necessa- 
 ry, for the protection of the debtor from the power of his creditor, to stay the 
 administration of justice, and prohibit by statute the issuing of an execution 
 for the collection of any debt. 
 
 This proves the connexion which subsists between the two great agricultu- 
 ral and commercial interests of this country. 
 
 Agriculture, commerce, and manufactures, constitute the source of our 
 wealth, revenue, and prosperity. To foster and cherish the principles unon 
 which rests our existing hopes and future prospects, can never be a question 
 of doubtful policy with a wise and patriotic legislature. 
 
 We have seen that commerce is essential to our interests; but commerce 
 will not flourish without credit. It never has prospered independent of ere 
 dit. As credit is essential to trade: so is punctuality to support credit. 
 Look at the business of any commercial people and see the integrity and 
 fidelity with which punctuality is maintained iu order to support their credit. 
 
 For several centuries past, banks have been the successful medium through 
 which credit has not only been preserved, but great wealth acquired. Tins 
 assertion is warranted by the history of these institutions, and of the countries 
 where they have been patronized. The first bank established in Europe, was 
 at Genoa, in 1407, 401 years ago: this was soon followed by one at Venice. 
 
 The Bank of Amsterdam was established in 1609; and shortly after, those of 
 Hamburg and Rotterdam; and the Bank of England in 1094. The Royal 
 
150 BANK OF THE UNITED STATES. 
 
 Bank at Paris in 1718. The Bank of North America in 1784, a memorable 
 period in our history, and the Bank of the United States in 1791. 
 
 All these different institutions show, that enlightened legislators have enter- 
 tained but one opinion upon this subject both in Europe and America, for the 
 last four hundred years. They have seen and acknowledged their utility. 
 Banks have long since been considered not only essentially useful in the trans- 
 action of commercial concerns, but as highly necessary to aid the fiscal opera- 
 tions of Government. And a more unanswerable argument cannot be urged 
 in favor of their general utility, than their uniform success; to this may be 
 added the prosperity of the people, and the countries, where banks have been 
 supported. Their immediate advantages arc, a convenient circulating medi- 
 ,uin ; the safe depository they afford tor cash and funds. And they serve to 
 keep the standard of money steady and correct; to insure punctuality; to pre- 
 serve credit; to inspire confidence, and to promote a spirit of industry and 
 enterpnze. They are not, as many have supposed, in their nature hostile to 
 government and dangerous to liberty. They rather form a barrier to tyranny 
 and oppression. Their principal business is to lend money at the common 
 rate of interest, and thus prevent usury. The owners of banks are generally 
 rich men, who have not only their personal liberty, but a large property to 
 risk, by sedition, treason, and rebellion. It is their interest to resist oppres- 
 sion. We need scarcely point to the continent of Europe for proof of the fact, 
 when we assert, that trade and banks cannot flourish where despotism prevails. 
 Despotic power generally ruins trade and banks, but no instance occurs in 
 history, Where banks, not under the control of government, have ruined a State. 
 A bank owned by government, and under its command, would be an engine 
 dangerous to the people. But when owned by individuals, neither the peo- 
 ple nor the government have any thing to fear from it. It is, then, depend- 
 ent on both for its business, prosperity, and usefulness. 
 
 With the evidence which both history and experience offers to our reflec- 
 tion, we cannot doubt the utility of banks, nor deny but that they have been 
 beneficial to us. And we are justified in the conclusion, that, under proper 
 regulations, they may subserve the best interests of the people of the United 
 States. They are now in successful operation in almost every State in the 
 Union, and that they have been useful, the present prosperous state of the 
 country abundantly proves. We enjoy as perfect security for life, liberty, and 
 property, as any people under any government ever did. These arc the great 
 objects of a good government. And we may triumphantly ask, where is the 
 nation or people that enjoy these with more freedom and safety than the Ameri- 
 can people ? A parallel for our liberty and prosperity, for the last twenty 
 years, is not to be found in the history of man. Our wealth, population and 
 resources, have increased beyond what any one would have calculated, or 
 imagined; and beyond what strangers and foreigners now believe. Industry, 
 wealth, and contentment pervade every quarter of our country, and poverty 
 and oppression are unknown to our citizens. 
 
 in 1791, the year this bank was incorporated, our exports amounted to about 
 eighteen millions of dollars, and in 1801, they had increased to about seventy- 
 six millions, gaining in thirteen years, fifty -eight millions; and our tonnage in 
 about the same proportion. 
 
 Much of this prosperity is to be attributed to the active capital, which has 
 excited industry and a spirit of enterprize among us; and the activity of this 
 capital has been, in a great degree, created and promoted by the Bank of the 
 United States. Its operations have been extensive in all our trading towns. 
 It has aided in loans and discounts, and assisted in the collection, sale-keep- 
 ing, and transmission of our revenues. It has been the depository of our 
 treasury, and is now become incorporated with the administration of the fis- 
 cal department of our Government. The connexion which it has formed with 
 almost every branch of business in the country, is not slight and trifling, and 
 so easily to be severed as some seem to believe. Its operation are deeply in- 
 terwoven with the dealings and concerns of all the men of business in the 
 United State?. 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 With a capital of ten millions, it has furnished accommodations of fifteen 
 millions a year. This has been employed principally in trade, in making 
 prompt and cash payments to our farmers lor their produce. This again has 
 furnished to our citizens a ready and profitable market for every article of pro- 
 duce. These high profits of a good market have gone into the hands of the 
 farmer, to cultivate, improve, and enrich the country. And travel through any 
 State in the Union, and their effects may be readily seen, affording a prospect, 
 consoling and elevating to the philanthropist and the patriot. The land is 
 highly cultivated, good buildings, turnpike roads, bridges, and other expensive 
 improvements indicate the wealth of our citizens, and the prosperity of the 
 country. Money has been freely circulated; trade has been active; produce 
 high, and our country has been improved by these unexampled advantages to a 
 degree far beyond what the most sanguine calculations twenty years ago could 
 have anticipated.,' And yet, sir, we are gravely told, that this bank has nearly 
 ruined the country; that it is threatening our best interests with destruction! 
 As well might gentlemen tell us, that total darkness prevails at noon day; or 
 that the sun in his meridian splendor affords neither light nor heat to any part 
 of this globe. 
 
 The principal portion of the trade and business of the United States^ has 
 been conducted by a paper medium, metallic has scarcely been seen. The 
 amount of this circulating medium is, say fifty millions. Now, what is pro- 
 posed by denying a renewal of the United States Bank charter? That^ tills 
 bank shall close its concerns, and of course stop all its iccomodations. This 
 must necessarily check and change at least one-third of the circulating me- 
 dium of the country. It will undeniably require $-3-1,000,000 to be directed to 
 one operation, and, fora time, to one point: for the capital U $10,000,000. 
 This is to be collected to divide among the stockholders. There are $19,000,000 
 due to the bank? this must be collected. This will occasion a demand for 
 this amount from other sources ; it must be paid. And the $5,000.000 in (he 
 bank, makes the sum $21,000.000 which must be suddenly called in. The 
 effect this will have upen the \ariuus interests in the country, can neither be 
 described, or conceived. It must inevitably give a genera I and heavy shock to 
 all paper credit this credit so much and profitably in operation must recehea 
 severe if not a mortal wound. And what substitute have we lor ihis, when it 
 shall be destroyed? Silver and gold coin cannot be relied on. There is not, 
 from the best estimate, an amount to exceed $10,000,000 snecie in all our cities 
 and trading towns, and this will be collected by this bank. The price of all 
 stocks and every kind of produce and species of property must suffer a great 
 depression: for a scarcity of money enhances its value, and, consequently, de- 
 presses the value of every other species of property. That this sudden, if not 
 total change in our system, must occasion great embarrassment, produce fail- 
 ures, dissapointments, and distress among our citizens, is certain. 
 
 To say the least of such a measure, is to term it an experiment which no 
 well regulated State has ever dared to make, from the first institution of civil- 
 ized society to the present time. Stronger governments than ours, in risking 
 such an experiment, would ensure their overthrow and ruin. Perhaps the 
 good fortune of the American people is a sufficient guarantee against all the dis- 
 astrous consequences which any other people might experience from such a 
 measure. But I own, sir, I dare not incur by my vote the awful responsibility 
 of this bold and untried experiment, unless compelled by the constitution. 
 This, in my most deliberate opinion, the constitution does not require. 
 
 But the question of constitutionality I shall not at this time discuss. If it is 
 a question which Congress may discuss and decide, it was discussed and de- 
 liberately decided at the time this charter was granted. The decision it then 
 received has met with the general approbation of the States and of the people. 
 Branches have been established in a number of the States, and the bills have 
 circulated without opposition or difficulty in all. And counterfeiters of this 
 paper are punishable lor forgery, by the statutes of the different States. For 
 twenty years, this institution has received the countenance and patronage of 
 the Government. In this patronage there has been no difference in the several 
 
152 BANK OF THE UNITED STATES. 
 
 administrations, unless that of the republican administration has been the 
 
 most extensive. This bank has been employed by the Government to keep its 
 
 treasure, to collect and transmit the revenue and the Government, it will be 
 
 recollected, originally owned two-fifths of the capital, which has been sold at 
 
 a great advance. The United States owned $2,000,000, equal to 5,000 shares. 
 
 2493 shares were sold in 171)0 7, at an advance of 25 per cent. $097,200 
 
 25 per cent, gain, 298,600 
 
 First sale amounted to - $1,295,800 
 
 287 shares sold in 1797, - $114,800 
 
 At 20 per cent, advance, gain, 22,960 
 
 $137,760 
 
 By the republican administration in 1802, 2,220 shares, 888,000 
 
 At 45 per cent, advance, gain, - 399,600 
 
 $1,287,600 
 
 137,760 
 
 1,295,800 
 
 $2,721,160 
 
 So that the United States gained $721,000; ^and of this, $399,600 has been 
 received by the administration under Mr. Jefferson. This sale was sanction- 
 ed by a vote of the House of Representatives, although it was to a foreigner, an 
 Englishman, Mr. Baring; and our Government gained on this sale $399,600. 
 This conduct of the Government, and of the then republican majority of the 
 House of Representatives, did not evince any scruples about the constitution- 
 ality of the charter. If it was deemed unconstitutional and dangerous to the 
 liberties and best interests of the people it was not for those who entertained 
 this opinion to give it countenance and support. They ought rather to have taken 
 measures to have checked and stopped its operations. And there is nothing in 
 the argument that the faith of Government was pledged for twenty years, and 
 the law, although unconstitutional, could not have been repealed: for Con- 
 gress cannot pledge the faith of Government by an unconstitutional law. If 
 Congress should establish a monarchical Government in any State or Terri- 
 tory, and by law guarantee it to the people for twenty years, would any one 
 dare to contend that the faith of Government was pledged for twenty years, 
 and this law could not be repealed? Certainly not. And why? Because such 
 a law would be unconstitutional. It would be the duty of the legislature to 
 repeal it, because the members are sworn to support the constitution. And 
 how will gentlemen who have been members of this House many years, and 
 entertaining the opinion that this charter was a violation of the constitution, 
 and voting to approbate the sale of the bank stock, and for other measures to 
 countenance its operation, and never attempting to rid the country of this 
 monster, reconcile their conduct with their duty? It can only be reconciled 
 
 mentary to the act to incorporate the subscribers to the Bank of the United 
 States." 
 
 " Be it enacted by the Senate and House of Representatives of the United 
 Slates of .ftmerica, in Congress assembled, That the president and directors 
 of the Bank of the United States shall be, and they are hereby, authorised to 
 establish offices of discount and deposite in any part of the territories or depen- 
 dencies, of the United States in the manner and on the terms proscribed in the 
 act to which this is a supplement.'' 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 If the original law was unconstitutipnal, this act extending the powers of 
 the corporation was equally unconstitutional. This act was passed by a 
 republican Congress, who did not believe that the original charter was uncon- 
 stitutional. It is but lately, very lately, that constitutional difficulties have 
 suggested themselves to some gentlemen. Even at this time, the administra- 
 tion has no objection to the constitutionality of the measure. The report of 
 the Secretary of the Treasury, the proper officer to speak the opinion of the 
 Executive upon this question, is my authority for the assertion, that the Exe- 
 cutive will nave no constitutional difficulties to encounter in passing a bill 
 for the renewal of this charter. That report was made pursuant to a resolu- 
 tion of this House, and has been laid upon our tables. It states no objections 
 to the renewal of the charter, but points out the advantages the Government 
 have derived from this bank, and hereafter may derive, if it shall be continued. 
 How is it that this report or the chancellor of the exchequer, upon a question 
 of financial economy, is not respected, as were his reports in former times? 
 Has he lost his talents at calculation? Does he tell unwelcome truths, or 
 is there " something- rotten in Denmark?" Great exertions have been made 
 to excite sensibilities, and clamor against the renewal of this charter. The 
 money changers, stockbrokers, and speculators, vultures that prey upon the 
 vitals of the community, have been flying through the country, denouncing 
 all who should express or entertain an opinion in favor of the measure. But, 
 I trust, we are not yet arrived to that period in the history of our Govern- 
 ment, when Congress must legislate under the hissings of the gallery, or the 
 denunciations of prostituted or misguided presses. If we are, sir, we may 
 bid adieu to our liberties. Unawed by these vaticinations, it becomes us to 
 examine patiently, and decide deliberately this great question presented to 
 our consideration for decision. 
 
 In examining this question, we are naturally led to inquire, is an institu- 
 tion of this nature, in the present state of our country, necessary is it proper ? 
 and in pursuing this inquiry, let me recur to the report of the Secretary of 
 the Treasury; and see if the aid of this institution is required in the administra- 
 tion of the financial department of the Government. Will not his experience 
 enable him to answer the question correctly ? To what better authority shall 
 we resort? What are the principal duties of the Treasury Department? The 
 collection, safe keeping, transmission and disbursement of public moneys. 
 For performing all these duties, this bank has been the efficient and faithful 
 agent. In twenty years past, it has collected and disbursed, at it own risk, 
 not less than 100,000,000 dollars public moneys. If you allow the revenue to 
 have averaged $5,000,000 a year, it would amount to this sum received in, 
 and the same amount transmitted and disbursed, amounts to $200,000,000 in 
 twenty years. Having a greater capital than any other company in the coun- 
 try, the public money is more secure with this company than any other. It 
 then assists essentially in the safe keeping of the money, and this the report 
 tells us is one of its advantages to the Government. But its more essential 
 assistance to the Government is in the collection and transmission of the 
 revenue at its own risk. Our revenues are secured by bonds, and these bonds 
 are payable at this bank and its branches, in the different ports of collection. 
 
 They are, accordingly, lodged in the bank for payment, and when due, they 
 / must be punctually paid, or the debtor loses his credit at the bank, and of course 
 in the commercial world. Hence every exertion is made to pay at the time 
 
 the bond becomes due ; and hence our revenue has been paid with such 
 scrupulous punctuality and with so few losses. And is it not an object of 
 magnitude, that we provide for the safe and sure collection of our revenues, 
 which in prosperous years, may amount to eighteen or twenty millions of 
 dollars? 
 
 Put down this bank, and how are your revenues to be collected? Through 
 the medium of the State banks? You do what no prudent man in his individual 
 concerns, would think of doing. You discard a faithful, honest, responsible 
 agent, whose integrity and fidelity you have known for twenty years, and you 
 place your estateln the hands, and at the disposal of, twenty or thirty entire. 
 20 
 
154 BANK OF THE UNITED STATES. 
 
 strangers, of whose character and responsibility you know nothing, nor have/ 
 the means of acquiring any knowledge, and orer whose conduct you have no 
 control. Should an individual act thus with his property, he would be deemed 
 to have lost all regard for it, if not considered a madman. In resorting ta 
 the State banks, we are offering. the amount of our revenue as a bounty for 
 intrigues, cabals, and faction, through the country. In almost every State there 
 are a number of banks,, and each will endeavor to get the revenue collected 
 in that State, to keep and trade with. It must be given to one or divided 
 among them all. If one is selected as the fovorite, all the rest become jealous^ 
 dissatisfied, and exert their capital and influence against the favorite bank, and 
 its patron, the Government. This will awaken a spirit of faction in every 
 State, yet unknown in this country^ If all are to be gratified in their request 
 for the deposites T the Government must open separate accounts with all the 
 different banks in the country, to the amount of fifty or sixty, and new com- 
 panies will be formed, and new applicants request to divide the business and 
 share the profits. Indeed, there will be no end to the scenes of speculation 
 and intrigue which will soon appear, if this course is adopted by the Govern- 
 ment. 
 
 Again: the Government have no means of ascertaining the system or princi- 
 ples upon which these different banks conduct their business; they are creatures 
 of the States, and in no way answerable to the General Government. The* 
 treasury cannot inspect their books, nor ascertain their funds; of course we 
 must be ignorant of their responsibility. And yet we are to deposite moneys 
 in their hands, to five or ten times the amount of their capital, But few of 
 the State banks have a capital beyond a million. In New York and Boston 
 the revenue deposites may amount to five or six millions a year; and are we to 
 intrust this with a corporation, which, if it failed r would not pay more than a 
 fifth part of it?' Besides you may not be able to command these moneys when 
 required, if left with those over whom you have no power. It is possible 
 some of these State institutions may be hostile to your Government; they may 
 refuse payment, and this refusal be supported by the State. Shall we place 
 our public treasure under the control of States which can order out their 
 militia, to oppose and resist the execution of our laws, or refuse their aid 
 to enforce them? 
 
 But, suppose the revenue collected, and safely kept by these different banks, 
 how is it to be safely arid speedily transmitted to different parts of the Union, 
 to answer the demands of Government, and at whose risk and expense? Can 
 the opponents of this bill obviate this difficulty? It is a difficulty of a two- 
 fold nature, first, in finding a safe mode of conveyance, and secondly, a con- 
 venient medium to transmit. Specie cannot be procured; and what State 
 bank bills, if sent, would pass current in every part of the United States, as 
 the bills of this bank do? Carolina and Kentucky bills are unknown, and 
 would not pass in New York and Boston; and New York bills would not 
 pass in Kentucky or Carolina, New England bills do not pass in New York, 
 but at a considerable discount. But, under the present system, if Govern- 
 ment have five millions deposited in Boston, and it is required to be paid at 
 New Orleans, a draft is given by the branch in Boston upon that in New Or- 
 leans, and the money is paid at the latter places as soon as the mail can travel 
 there. 
 
 Again: if the Government is to take the risk of collecting and distributing 
 the revenue, jet us inquire what this can be done for.- The revenue amounts 
 to, say ten millions of dollars, collected and paid out annually, and allow 
 one and a half per cent, for collecting, and one and a half per cent, for trans- 
 mitting, as low a rate as it would be done for, and this, on twenty millions., 
 amounts to 600,000 dollars a year, a sum equal to pur civil list. 
 
 But, another serious evil is to be encountered in putting down this bank; 
 
 you deprive the country at once of a circulating medium. Silver and gold 
 
 cannot be had; and what paper, but that of the United States Bank, will pass 
 
 1 current in every part of the Union? None. You can outride, in twenty-four 
 
 hours, the credit of any other bank in the country. This evil will be most 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 seriously felt in the interior. It will at once check emigration from the North 
 and East to the West. For those who wish to remove, will not be able to 
 sell their property; it will tall essentially in value; and if they should sell, 
 coin not being in circulation, they could not procure any paper money which 
 would pass current to pay; the expenses of travelling from Massachusetts to 
 Ohio and Tennessee; and if they should arrive there, they would have noth- 
 ing to purchase land with. The sales of our land must stop for a time, at 
 least till specie can be brought into circulation, for specie only /is taken in 
 payment; this comes now through banks; but the banks will require it all for 
 their own support 
 
 And will not the people inquire why all this pressure and embarrassment? 
 They certainly will. And will they be satisfied with the answer, that the 
 bank was unconstitutional, and could not therefore be continued? No, they 
 will not believe it They will justly reply, that this state of things ought to 
 have been foreseen and provided for by their rulers., as it might nave been. 
 In the ten past years of peace, plenty, and prosperity, which we have expe- 
 rienced, instead of devising a system to take the place of the present bank, on 
 the 4th of March, what have the rulers done? They seem never to have once 
 thought of the event that is now about to happen? By the acts of Govern- 
 ment, the country has, in a degree, been deprived of the capital which might 
 have been here to meet the crisis. Above $30,000,000 have been sent out of 
 the country, and much of it in specie, to pay the public debt, when payment 
 was not demanded. All internal taxes have been repealed, and reliance for 
 revenue has been made on imposts and tonnage, which are now about to fail 
 us, and that, too, when the treasury is nearly exhausted. For, after paying 
 the $2,750, 000 to this bank, there will not remain much more than this amount 
 in the treasury. The revenue bonds outstanding, to the amount of about 
 $10,000,000, will not, cannot be paid, if bank accommodations are to stop. 
 Recourse must be had to loans, the last resort of empty purses and empty 
 heads, and a press for money, and its high price, will render loans difficult 
 to be effected, and subject the Government to a high rate of interest . 
 
 These considerations suggest to us the imperious necessity of continuing 
 the operations of this bank, under such restrictions as may be deemed most 
 advisable, and thus to keep in motion the present system of credit, and sup- 
 port the existing principles of doing business throughout the country. 
 
 And what are the reasons for reluming a renewal of, this charter? Let them 
 be examined, and, unless they are solid and substantial, let them not prevail. 
 One reason assigned is, that it employs a foreign capital, which is injurious to 
 our country. 
 
 This is not an objection of any weight; and if it were, have Congress the 
 power to prohibit the employment of foreign capital in the United States? If 
 we prevent it from being employed in this bank, it may go into the State banks, 
 or take any other direction, not prohibited by the constitution or laws of the 
 country. But it has ever been the liberal policy of this Government, to invite 
 foreign capital, and foreigners, to come among us. 
 
 Gentlemen seem to consider that portion ot this stock, held by foreigners, 
 as haying no other connexion with our own citizens, than compelling them to 
 pay eight per cent, per annum interest for it. 
 
 Let us for a moment see how this money, to the amount of $7,200,000, 
 owned by foreigners, is employed, and the objection urged on this ground must 
 vanish. It will not be denied, but that it is used in trade. And it is wanted 
 here, to make cash payments for shipments made to Europe. This enables 
 the American merchant to make prompt payment for the goods he imports 
 from Europe, by which he obtains them, say eight per cent, below the credit 
 price, while he, instead of obtaining this credit in Europe, obtains it at the 
 bank for six per cent Here, then, is a difference of two per cent, in favor of 
 the American merchant. This, on $7 ? 200,000, amounts to $144,000 a year 
 in twenty years, to $2,880,000. This is one item saved in retaining this capi- 
 tal, in this institution and $1,200,000, the sum to be paid by those stock- 
 holders for the privilege of continuing their capital in this btenk, is another 
 
156 BANK OF THE UNITED STATES. 
 
 item and another, larger than either of these, is the advance upon the stock 
 proposed to be subscribed by the United States, which may be estimated at 
 $2,000,000. These, together, amounted to $6,080,000, which the Govern- 
 ment and citizens of this country will receive by passing this bill. So far, 
 this would be raising a revenue, and not liable to any constitutional objection. 
 But, it is said, this capital has an influence upon elections, unfriendly to 
 liberty. Whatever may have formerly been the political influence of this in- 
 stitution, the competition of banking business has long since rendered it harm- 
 less as a political engine. But, while gentlemen complain of its accommoda- 
 tions being partial, they propose the singular remedy of destroying them en- 
 tirely; because it has committed the fault of not accommodating every body, 
 it must now cease to accommodate any body. 
 
 If we have not too much capital, our citizens will find a profitable use for 
 this. That this is wanted, and engaged in business, is incontestibly proved by 
 the dividends which this bank has made of eight and nine per cent, profit. If 
 the charter shall expire an the 4th of March, this $10,000,000 capital, which 
 may, and probably will be collected in specie, will be again thrown into circu- 
 lation here, or sent out of the country. 
 
 Suppose it retained here, what are we to gain or lose by the experiment? 
 The scarcity of specie consequent to this operation, will appreciate its va- 
 lue, and, in like proportion, depreciate the price of every other kind of proper- 
 ty, say thirty per cent. These foreign stockholders, having $7,200,000 in 
 specie, will be able to speculate on the distresses of your own citizens. They 
 will be the gainers, we the losers. If they can make by the bargain, as they 
 undoubtedly may, 30 per cent, this on $7,200,000 would amount to $2,160,000; 
 which, added to their present capital, would be $9,360,000. This amount, 
 vested in any other bank stock, or valuable property, would continue to yield 
 them eight per cent, profit annually. This, on $9,360,000 amounts to $744,860> 
 a year, $168,800 more in a year than they would receive by continuing their 
 capital in this bank. It is evident that a refusal to renew the charter of the 
 Bank of the United States will not prevent the use of foreign capital among 
 us, as has been urged by gentlemen opposed to a renewal. I do not allude to 
 the gentleman from Virginia, [Mr. BURWELL] he does not consider it an 
 objection that so much ot this stock is owned by foreigners. 
 
 But let us, for a moment, suppose, that, on a dissolution of this bank, this 
 capital goes out of the country; it is owned by proprietors who reside in Eng- 
 land, where bullion is 15 per cent, above their paper currency, and if this 
 $7,200,000 should be sent to Europe it would drain nearly all the specie from 
 the country. Unless it can be employed here to more advantage, it will, as 
 an article of merchandise, leave the country for a better market. But it will, 
 at any rate, be in the hands oi those who may not, after the refusal to renew 
 this charter, feel very solicitous to aid the operations of your Government, or 
 relieve the distresses of the people, by sending this specie into circulation 
 among us. We should require strong arguments, indeed, to induce us to 
 adopt a measure which may at once drive out of the country, or lock up so 
 large a portion of the specie capital. Whether it goes out of the country, or 
 remains for a year inactive here, the effect upon the community will be the 
 same. The great demand, and high price of specie, will depress the price of 
 every kind ot stock and every species of property; our wheat, cotton, hemp, 
 tobacco, and every article of produce, must suffer a depression of at least 10 
 
 country may be estimated at $100,000,000; a loss of 10 per cent, would be 
 $10,000,000, a sum equal to our revenues for one year. By whom is this loss 
 to be sustained? By the merchants? No, it will fall upon the farmers, the 
 manufacturers, and mechanics; your rich moneyed capitalists are safe, nay, 
 they are the only men v ho will profit by such a state of confusion and 
 distress. 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 "When I advocate a continuance of the present system, I advocate the in- 
 terest of the farmer, the mechanic, and even the laborer, who, alone, must 
 suffer most severely by the experiment of breaking up this bank and your 
 present system of paper credit. Of this we may all be convinced when too 
 late to remedy the evil. The effect it may produce may be entirely different 
 from what the opponents to this bill now believe. Instead of a blessing, it 
 may prove a scourge and a curse to the country. Politicians, we all know, 
 are liable to err in their calculations, and often mistake the real bearing and 
 effect of their measures upon the community. The Turkish Government 
 once devised and adopted an infallible expedient, as the rulers believed, to 
 prevent a scarcity of corn, by prohibiting the exportation of this article. But 
 the consequence of this favorite measure was a famine, want, and calamity, 
 instead ot plenty and happiness. 
 
 And are gentlemen, who are opposed to the renewal of this charter, quite 
 sure what will be the consequence of stopping at once the operations of this 
 bank? I apprehend not. 'Ihey all admit it will, for a time, occasion some 
 embarrassment to our citizens and our treasury; but they differ as to the ex- 
 tent of the evil, and tell us that all the calamity is to be far outweighed by the 
 blessings which are to follow; and, among other blessings which are to result, 
 is the check which is to be given to trade. We are told that there is too 
 much credit, and too much trade; that failures are continually occurring, and 
 that, although the merchant fail, the fanner bears the loss. A single glance 
 at the manner of transacting business in our commercial towns must convince 
 any gentleman that, when a merchant stops payment he is seldom indebted to 
 the farmer. His credit contracts are with the banks and merchants in town; 
 instead of purchasing produce from the farmer upon credit, the merchant 
 obtains a credit at the bank, procures bills, and is, in this way ? able to pur- 
 chase from the farmer for ready money, and if the merchant tails, his credi- 
 tors in town, not in the country, are generally the sufferers. By lessening or 
 destroying bank accommodation, you transfer the credit from the city to the 
 country. Then, if a merchant should fail, his creditors in the country, the 
 farmers, would suffer; should this be the effect of putting down this bank, 
 the agriculturist, who now sells his wheat, hemp, cotton, and tobacco, for 
 cash, will be compelled to sell upon credit, and take the risk of failure from 
 the banks and merchants to himself. Is this the manner in which trade is to 
 be lessened by stopping bank credit? 
 
 But it has been urged that we have too much paper in circulation. Admit 
 it. The destruction of this bank will increase, not diminish, the quantity of 
 circulating bank paper; and 1 consider the embarrassment which must im- 
 mediately follow the closing of the concerns of this institution as the least of 
 the evils the community will experience from a refusal to renew the charter. 
 Congress may, indeed, prevent the operation of this bank after the 4th of 
 March, but Congress can neither prevent a spirit of trade, nor subdue the 
 passion for speculation. For, while we are debating the expediency of de- 
 stroying this bank, in order to free the country from the mischiefs of an 
 extended bank credit, we find new banks springing into -existence in every 
 direction. We have no less than live bills now on our table for incorporating 
 this number of banks in this ten mile square district. And the gentleman 
 from Virginia [Mr. BURWELL] has told us, that these applications are an evi- 
 dence of capital or of corruption; but I consider them rather as evidence of 
 the destroying spirit of speculation, which threatens to stand upon the ruins 
 of the United States Bank, till the country shall be overwhelmed with new 
 emissions of paper from these new manufactories. The banks established by 
 the State Legislatures will scramble for the privilege of filling the chasm to 
 be made by the destruction of the Bank of the United States. Already are 
 they preparing for the patriotic endeavor. Our State legislatures are to be 
 importuned to become bank-jobbers, and joint undertakers and copartners 
 in the enterprize. The profits are to furnish revenues sufficient to satisfy 
 both avarice and ambition. Notwithstanding the provision in the constitu- 
 tion that no State shall kt emit bills of credit," \ve find almost every State in 
 
158 BANK OF THE UNITED STATES. 
 
 the Union interested in baftks, authorising corporations to issue bank bills, 
 which, so far as they exceed the capital upon which they are issued, are in the 
 nature of bills of credit. Several States own stock in these banks, and, as 
 such stockholders^are responsible for the payment of these bills; Pennsylva- 
 nia, Virginia, and Vermont, are large stockholders in their State banks; 
 New York and North Carolina have also an interest in some of their banks. 
 The States cannot be restrained, nor is it to be wished that they should be 
 prohibited altogether from incorporating banks. But what difficulties are we 
 to experience in resorting to these numerous and conflicting institutions for 
 the collection, safe-keeping, and transmission of our revenues. The depo- 
 sites of >lhe Government will render banking profitable to the favorite bank 
 that receives them. The aid of the Government will make this bank supe- 
 rior in funds and credit to any of. the others which do not share this solid 
 patronage. This will produce jealousies and collisions of interests between 
 banks in the same State, and thus form cabals against the State and General 
 Governments. It will not stop here, but will extend from State to State. If 
 the States and State banks are to regulate trade in the article of paper money, 
 they may prescribe the terms. To give the preference to their own paper, 
 they may exclude that of any other State from circulation among them in the 
 same way that the paper of unincorporated banks is excluded by some States, 
 and bills of a certain amount from others. 
 
 The great commercial States will have in their power the paper of the small 
 and agricultural States: for where there is most trade, there the most current 
 bills will be the most valuable. The bills of New York and Pennsylvania, 
 from the great trade and frequent intercourse between their capital cities, 
 would be in greater demand than any other; the bills of either State would 
 pass current in the other, and this would give them a credit and currency 
 superior to all other bills. They would of course drive the others out of 
 the market. And, sir. it is possible that other banks may attempt to make 
 up, in the quantity of their paper, the deficiency in its quality and credit, and 
 all may overtrade their capital, discount far beyond their funds, until a gene- 
 ral depreciation of their paper shall produce general failure, and universal 
 distrust in all paper credit. It is the duty ot the Government, if in their 
 power, to avert such a state of confusion, to protect and preserve the country 
 from such complicated ruin. But we are about to invite and precipitate this 
 destruction by throwing away the only means we possess to prevent it. Stop 
 this bank, and what check is there then to limit the discounts of all other 
 J3anks? They may issue paper to any amount and without funds to redeem 
 it. There may, and very probably will be, a common interest and feeling 
 among them to uphold each other, until all shall deem it advisable to fall. 
 Hitherto the Bank of the United States, by its large capital, and the amount 
 of its specie always on hand, has confined the discounts of other banks to cer- 
 tain limits, and compelled them to observe some proportion between their 
 loans and actual funds. And, in this way, it has served as a barometer to 
 ascertain the credit of other banks; as a regulator to keep them within such 
 bounds as might be safe to the community. But take away this regulator, 
 and the other banks may go on without fear or restraint to loan millions, with- 
 out having a dollar in their vaults, until all will be reduced to bankruptcy, as 
 we have already witnessed, in some parts of New England. We have been 
 told, by gentlemen, that this bank has been the cause of the excess of bank 
 paper, which has prevailed in some of the Eastern States. This I deny. 
 What has been the conduct of banks in that quarter? A considerable num- 
 ber of banks were established in the interior of Massachusetts and New Hamp- 
 shire, and they went on to issue their bills to a great amount, without re- 
 gard to their actual funds, and without any specie to redeem them- And had 
 these bills circulated only in places where banks were conducted in a man- 
 ner equally loose and unprincipled, the imposition would not have been readily 
 detected; 'but when these bills appeared at the Branch Bank of the United 
 States, their real value was tested; they were returned, and the system of 
 banking without specie or capital was broken up and destroyed. It will 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 hardly be contended that our revenues would have been perfectly secure in 
 these banks. And what assurance have we that they will be more safe in the 
 others? The Government of the United States cannot limit their discounts, 
 inspect their books, or ascertain the state of their funds, or the principles upon 
 which they act. It never can be seriously insisted, that it would be advisable 
 to deposite the public moneys in this manner. It would be offering the reve- 
 nues of the Government as a bounty for bank factions, and bank frauds. And 
 why shall we be driven to make these dangerous, ruinous experiments? We 
 experience no hardships, no real difficulties growing out of our present sys- 
 tem. If we continue it, none are to be apprehended. We shall preserve a 
 paper medium, well known and long approved, with which the people of this 
 country are well satisfied: for not a single remonstrance has been offered 
 against continuing the operations of this bank, whilst thousands of petitioners 
 have solicited Congress to renew the charter. Nothing, but considerations of 
 the most imperious nature, should induce Congress, at this time, to refuse a 
 renewal of this charter, and thus compel the extensive moneyed operations of 
 this company to stop at once. The situation of the country is, at this period, 
 peculiarly unfavorable, if not unequal to such an operation. But a small 
 amount of specie in circulation ? and the course of exchange continually les- 
 sening the quantity, draining it from the country; a large portion of the 
 merchant's property seized in Europe; our treasury nearly exhausted; a non- 
 importation about to be adopted; our revenue to be thus cut off; our army and 
 navy expenditures to be increased; and, in this state of our national affairs, 
 we are about to destroy all confidence in paper credit; to adopt a measure 
 which must produce grneral disappointment, failures, and bankruptcy. How- 
 ever unconcerned ;iiid secure some gentlemen may feel about the consequences 
 which may result from such a state of things, I cannot but contemplate them 
 with the most fearful apprehension. Can the people extend their confidence 
 to the wisdom and expediency of measures which, instead of promoting the 
 general welfare, produce general distress? Why, sir, we seem to cherish as 
 little regard for the opinions of the People, as it they had nothing to do with 
 the Government. 
 
 But the remedy for all the evils growing out of this breaking down measure, 
 is to be found, we are told by some of its advocates, in the establishment of a 
 new national bank upon the* ruins of this. The country is to be subjected 
 to the sp:isms and throes of death and birth, at the same instant, in order to 
 preserve, by this bold practice, its constitution. This is a refinement in State 
 quackery, which must prove fatal to the patient. 
 
 Are the advocates for a national bank quitC T sure that they could obtain a 
 law of Congress for its establishment, if the United States Bank were out of 
 the question? I apprehend not. Many serious, if not insurmountable difficulties, 
 would be found to exist. When an increased demand for money should have 
 rendered it scarce, it would illy comport with that discretion and intelligence 
 which ought ever to distinguish the proceedings of Congress, to increase the 
 scarcity of this article, by enlarging the immediate demand for it. While 
 $-24,000,000 would be employed in closing the concerns of one bank, $30,000,000 
 are to be called for to commence the operations of another. This would 
 be levying a requisition upon all the circulating medium of the country at 
 once. It would create a demand which could not be satisfied. If this ob- 
 jection could be removed, there are others still stronger to be obviated. It 
 would be found difficult to convince the States concerned in banks, that 
 their interests are to be promoted by a great rival bank, with a capital and 
 ability equal to the management of all the banking business in the country. 
 Will the great commercial States of Massachusetts, New York, and Penn- 
 sylvania, accede to this measure? They will not, unless they disregard all the 
 profits they might derive, by uniting to give credit and currency to the paper 
 of their own banks, unless they neglect to improve the advantage they would 
 in such case have over the other States. If some States now recommend to 
 their representatives to oppose a renewal of this charter, would they be less 
 attentive to their own interests, and more sparing of their advice, when a 
 
150 BANK OF THE UNITED STATES. 
 
 national bank should be attempted? No, sir. Nor would their recommenda- 
 tions be less regarded than upon the present occasion. If a bank with but 
 $10,000,000 capital, has awakened State jealousies, and roused to action State 
 interests against it, what are we to expect when a new bank of $30,000,000 
 shall be proposed? That such an institution could be established without op- 
 position? No. It could not succeed against the opposition it must and would 
 encounter. Put down the Bank of the United States, and, however essential 
 an institution of the kind may be found, either to furnish a circulating me- 
 dium, which shall pass current throughout the United States, or aid in the 
 administration of the finances, the Government will not have the power to es- 
 tablish it. A law for the purpose, would never be sanctioned by a majority 
 of both Houses of Congress. And, if we cannot continue the present bank 
 upon any terms, no other ought ever to be authorized by Congress. For to 
 what a state of things might a new national bank, with twenty or thirty mil- 
 lions capital, reduce the country at the expiration of twenty years from this 
 time? Its stock might get into the hands of foreigners, or be owned by those 
 who would be found in the opposition to the administration; and surely, this 
 would furnish reasons as powerful for putting down the national bank, as the 
 Bank of the United States; and the country would be compelled to submit to 
 another general shock, and, perhaps, destruction of paper credit. If we have 
 not stability and discretion sufficient to continue and support such an institu- 
 tion, we most certainly should not undertake to establish it. For we are ex- 
 posing the country to alternate affluence and penury; making experiments 
 ruinous to the people, and destructive to the Government. 
 
 Some gentlemen tell us that this corporation can close its concerns without 
 occasioning any embarrassment in the community. If the trial is to be made, 
 I most sincerely wish they may not be mistaken; but to me it appears utterly 
 impracticable. The gentleman from Virginia [Mr. BURWELL] seems to think 
 that the shock will be slight, and scarcely perceivable; that this angry cloud 
 will be disarmed by the conducting powers of the State banks. But can he 
 assure us, that such will be the result from any actual experiments which 
 have ever been made in this branch of philosophy? I believe not. And it is 
 to be apprehended, that, even if this cloud should disappear, clouds of dis- 
 content and faction will succeed, and may soon be seen hurrying and chasing 
 each other over the political firmament of America, until the tempest comes 
 on, which shall close forever the prospect of our united strength and happi- 
 ness. 
 
 The times are dangerous for national experiments. When we look around 
 us, we find the political passions of man rising to madness; long established 
 
 Governments breaking up their strong foundations, and the world almost 
 eluged with blood and warfare; we alone, stand upon the narrow isthmus of 
 peace and prosperity. And is it for us to complain; to be discontented with 
 the pre-eminent happiness we enjoy; to hazard our present enviable condition 
 upon the doubtful result of this great and sudden change in the administration 
 of our national finances? No, sir. It becomes us to beware of innovations; 
 to weigh well the consequences of embracing any new system, or abandoning 
 an old one. But, sir, I will not detain the committee longer. I have already 
 occupied more of their time than I intended; but a sense of duty has com- 
 pelled me to state my opinion at length upon the important question before 
 us. And, if the charter of this bank is not to be renewed, or continued upon 
 any conditions, I am ready to hope, that my apprehensions of the effects that 
 the refusal will produce in this community, may prove groundless; that the 
 dissolution of this institution may not be the organizing of ruin to a con- 
 siderable portion of the country. 
 
 Mr. SEYBERT. It may be said that this subject has been exhausted, by the 
 discussions of the ablest politicians of our country. I will premise, the re- 
 marks which I shall offer, are intended solely to justify the vote which it is 
 my intention to give on this momentous occasion. 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 The question pending the United States Bank has excited a peculiar inte- 
 rest throughout this nation, more especially in our seaports. The dissolution 
 of this institution, which, form its limitation, will expire on the fourth of March 
 next, lias been portrayed in colors of the darkest shades, and the distresses 
 \yhich many maintain will be consequent to that event, call seriously for a 
 fair and deliberate investigation. I hope, sir, I shall be pardoned for nnp9S- 
 ing on the patience of the House, when it is recollected that the community 
 which I represent, have employed four-tenths of the capital stock of the Unit- 
 ed States Bank. If evil consequences are to attend the dissolution of this 
 establishment, or if beneficial results proceed from its continuance, in either 
 case I must feel myself essentially interested. It is, therefore, my wish, to be 
 distinctly understood, upon the important principles which have connexion 
 with the great question now before us. 
 
 At the last session of Congress, I presented the memorial of the president, 
 directors, and stockholders of the Bank of die United States; at that time I 
 entertained no positive opinion on the subject; the discussions which took 
 place in the committee to whom the memorial was referred, necessarily, as a 
 duty on my part, excited that attention which the importance of the question 
 imperiously demanded. Under circumstances of doubt, I voted in tavor of 
 reporting a resolution in support of the bank, for the purpose of giving to the 
 establishment every chance which reason could urge; at the same time re- 
 serving to myself the right (o pronounce a final decision, according as policy 
 and expediency, but more especially as prtnctp/ should dictate. I will admit, 
 sir, that this is not the time or place to institute the general inquiry, whether 
 banks are or are not, beneficial to a nation? Because, whether the charter of 
 the United States Hank be renewed or not, ihe several Suites, who have the 
 unquestioned authority to incorporate bank establishments, have already cre- 
 ated many, which it is not ill our power to control. I do not hesitate to de- 
 clare ? though many persons in the United States are decidedly opposed to a 
 banking system, under every possible circumstance, I am not ot this class. 
 Experience lias proved, in a manner very satisfactory to my mind, the advan- 
 tages which are derived from banks, when they are impartially directed, and 
 when the accommodation att'orded by them is prudently employed; (he great 
 difficulty seems to be to confine the system within its proper limits. I under- 
 stand the proposition as applicable to the agricultural, manufacturing, and 
 commercial interests of the United States. 
 
 For my proofs of this proposition, I will not rely upon the famous Bank of 
 St. George, at Genoa, whose authority, by a gentleman Irani New York, (Mr. 
 FISK) has been considered of much weight. I will recall to the mind of my 
 friend, the remark of an intelligent traveller, who, when he visited this bank 
 of antiquity, exclaimed, " Here lies concealed the enigma, whether the bank 
 possesses millions of millions, or whether it is indebted millions of millions;" 
 he concludes, upon this important secret rests the safety of the State. Unhappy 
 State, sav I, whose safety depends upon a secret concealed within the vaults 
 of a bank. Perhaps, to a development of this secret, may we attribute the 
 present servile condition of the people of the once far famed and powerful 
 Republic of Genoa. 
 
 I am one of those who do not entertain fears in consequence of foreigners 
 becoming the stockholders of our banks; provided, on all occasions, you deny 
 them the privilege of voting either directly or by proxy. I would even go so 
 far as to prohibit their being original subscribers to any stock which may be 
 created in our territory. The States do not object to a foreigner holding the 
 stock of their banks. Any political consequences which can arise from such 
 an interest, will exist, without the General Government having power over 
 them. For the present, I am opposed to the exclusion of foreign capital from" 
 our country, because it is not established that we possess a surplus of our 
 own, and that the introduction of more from abroad depresses that which is 
 immediately the property of our citi/.ens; the prices which are at present paid 
 as the interest for a borrowed capital, convince me that it would be impolitic, 
 at this time, to adopt the principle of exclusion. 
 21 
 
16^ BANK OF THE UNITED STATES. 
 
 Though I have admitted, that, under certain specific provisions of the law. 
 foreigners should be permitted to hold the stock of the banks of the United 
 States, it is not thence to be inferred, because they have become the stock 
 holders, they are to be confirmed, from time to time, in the exercise of an ex- 
 clusive privilege in our country. 
 
 Sir, I am decidedly opposed to a prominent, and what to me appears to be a 
 very; dangerous feature in the bill now under consideration. I allude to the 3th 
 section, which admits of an increase of the present capital stock of the bank. 
 If you adopt this provision, you will thereby; create an Herculean power, 
 which will have at its mercy all the minor institutions of the States; thus con- 
 stituted, it can oppress and destroy them, as whim or interest may dictate. 
 The steps which have been taken preparatory to a dissolution of the present 
 bank, it is said, occasion much embarrassment, and threaten with ruin many 
 of our citizens. If the present capital often millions can thus affect society, 
 who will pretend to accumulate present evils, or risk entailing misery on pos- 
 terity, solely for the purpose of a temporary gain to the Government? In this 
 question Pennsylvania is deeply concerned 5 she has several millions of dollars 
 invested in her banks; this to her is a valuable source of revenue; up>on this 
 may she predicate much of her future prosperity; hence will she derive the 
 funds requisite for future internal improvements; but if you fill up the blanks 
 in this section with a considerable sum, all these prospects will be blasted 
 forever; you will thereby destroy the tree, from whose ramifications were to 
 emanate the blessings of peace arid the sinews of war. Those of her Repre- 
 sentatives who may deem it politic and constitutional to vote for a continu- 
 ance of the charter of the United States Bank, ought surely to oppose any 
 increase of the present capital. We have been told, that that which now ex- 
 ists, has been found sufficient for all purposes, at a time when our commerce 
 was much more extensive than we have reason to suppose will soon again be 
 the case. 
 
 If, as some say, the bank, by its capital, is to facilitate the fiscal operations 
 of the Government, I am decided this should never be greater than what will 
 be barely sufficient for this purpose. If you go further, you place in the hands 
 of the Government an engine which may destroy the freedom of this nation. 
 We are further told, that, in case of war, the Government may derive advan- 
 tage, in the form of loans, from the bank. Admitting this to be the fact, it is 
 very evident, under the uncertainties of a war, the demands of our merchants 
 upon the banks will diminish, so that the bank capital already created through- 
 out the Union, may be very readily had for the exigencies of the State. If a 
 greater sum shall be found to be necessary, the patriotic zeal of your citizens 
 will prove itself all-sufficient to supply your wants in a cause which will be 
 deemed just and honorable by the nation. 
 
 I am also opposed to the United States having the right, in any manner, to 
 appoint any of the directors of the bank, not so much on account of any influ- 
 ence which the Government might derive from such appointment, as to pre- 
 vent ruinous consequences to all who may be concerned. Who will such 
 directors generally be? Certainly persons who need the aid of the banks: for 
 none others would make application for the appointments. When they are ap- 
 pointed, they would be subservient to the views of such of the directors as 
 are chosen by the stockholders; in their places they will lose sight of the pub- 
 lic welfare; they will be interested by the accommodations which they may 
 find necessary ior their purposes; to obtain these, they will yield to their as- 
 sociates. Instead of being the guardians of the public treasure in case of dan- 
 ger, they will remain silent, until a spontaneous explosion of the bubble solves 
 tor the world the important secret of the insolvency of the institution. Sir, 
 notwithstanding many arguments may be adduced in support of a banking 
 system, no degree of importance, whatever, whether derived from the facili- 
 ties ottered to the Government by bank establishments, or from the consider- 
 able ums which may be thereby had for the treasury ? in consequence of sales 
 which may be made of the stock belonging to the nation, or of the bonus to be 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 given, shall induce me to vote in favor of a measure which is not grounded 
 upon strict constitutional principles. 
 
 The history of the banks in our country informs us, that the one usually 
 termed the Bank of North America, was the first establishment of the kind 
 which received the sanction of the Government. This institution was incor- 
 porated by an act of Congress, in the month of May, 1781, under the autho- 
 rity of the "Articles of Confederation." The present Bank of the United 
 States was incorporated by an act of Congress, on the 25th February, 1791, 
 during the operation of the present constitution of the United States. 
 
 Without an attempt to examine every hypothesis which has been or which 
 might be proposed, respecting the constitutionality of the principle, 1 will 
 content myself with a statement of the case, such as it appears to my mind. 
 The first public act which I performed, as a member of the Congress of the. 
 United States was, to swear, solemnly, that I would support the constitution 
 of the United States. It therefore is my duty to examine and consider its 
 precepts, according to the best of my ability. 
 
 The " Articles of Confederation" and the present constitution of the Unit- 
 ed .States, dp not differ, as regards any power delegated by the States to Con- 
 gress, touching charters of incorporation. I can never persuade myself that 
 the constitution was intended other than to have a definite meaning; or that 
 it was ever contemplated to speak an equivocal language; ambiguity arises 
 solely from the misconceptions of its interpreters. It is very plain and of easy 
 comprehension, especially as it relates to the present question, since it is 
 totally silent on the right to create corporations: its wisdom is further illus- 
 trated by the special provision lor the only exclusive privilege which is con- 
 sistent with a free and equal Government* and that is in favor of genius. The 
 powers delegated by the States are special and defined, and it is expressly de- 
 clared by the constitution, that " the powers not delegated to the L. States by 
 the constitution, nor prohibited by it to the States, are reserved to the States 
 respectively, or to the people." Tins language needs no interpretation. 1 cannot 
 for a moment permit myself to suppose, that the patriots who were tested dur- 
 ing the long continued uncertainty of the most important events of our revo- 
 lutionary period, and to whom was ultimately assigned the right and power 
 to construct the instrument which is to guide us in the political labyrinth, 
 that they intended this, their great work, should alone be explicable by that 
 refined reasoning, to which common sense is a stranger, I never can admit; 
 surely, that which they framed for the good and security of every individual 
 in the nation, must be expressed in a manner to be understood by ordinary 
 men, and those whom it was intended to direct. Sir, if simplicity was not 
 originally contemplated by the framers of the constitution, why the imposi- 
 tion on the people in publishing it to the vyorld? Was it not a prodigal waste 
 of labor and materials, to furnish every citizen of our country with a copy of 
 that which can only be understood by professional men, or such as are emi- 
 nently skilled in scholastic research? It had better remain a secret concealed 
 amongst the musty rolls in the archives of State, than be a puzzle for man- 
 kind. As long as this instrument is preserved pure and untarnished, it will 
 receive a becoming respect from your fellow-citizens it will be regarded as 
 * 4 the stupendous fabric of human invention." Remember, the present argu- 
 ment, in several important points of view, affects posterity in common with 
 ourselves. You had better commit the unintelligible jargon to the flames, 
 than, by the agency of construction, neutralise wisdom by folly. Sir, if we 
 have a constitution which the people cannot understand, I then say, cut the 
 original into slips, and provide the means for a better; or if that is not to be 
 done, and we are to be ruled by the iron hand of power, in that case, as one 
 of the American people, I will pray you to be graciously pleased to grant a 
 plain bill of rights lor our better government. 
 
 If we look back and attentively view the occurrences which took place when 
 the law incorporating the present Bank of the United States was enacted, we 
 shall find our reasoning supported and confirmed by many important circum- 
 stances,- we shall then perceive that the act of incorporation was opposed on 
 
264 BANK OF THE UNITED STATES. 
 
 constitutional ground, by men who were and continue to be esteemed for their 
 talents, political skill, judicial knowledge, probity, and patriotism, and it has 
 been admitted that the arguments formerly urged are unanswerable. That 
 the power to create corporations was never intended to be ceded on the part 
 of the States, is proved beyond all manner of contradiction; for we are told 
 by the highest authority, by one who was a member of the General Convention,, 
 that it had been proposed to cede to Congress the power to create corpora- 
 tions, and that the proposition was rejected, after a cleliberate discussion. In 
 my opinion, this decision is in proof of the sagacity and wisdom of those who 
 made it; it was highly justifiable to retain this power to be exercised by the 
 States; because corporations are generally founded on circumstances which 
 are entirely local; as such they can be better understood by the Legislatures 
 of the respective States, than by that of the General Government, 
 
 The experience of every session proves, that the decisions of Congress vary 
 with the men who, at different times, compose that body; therefore, the act of 
 February, 1791, can have no force in settling the principle contended for. 
 
 I have heard it urged that the States have recognised the constitutionality of 
 the'United States Bank, by their laws. I know of no law in any of the States 
 which declares this charter constitutional; were it even proved that several of 
 the States had published this declaration, with me it would signify nothing, 
 unless the sanction of two -thirds of the States was thus had. On a former 
 occasion, several of the States were induced, from peculiar circumstances, to 
 relinquish, for a time, their right in favor of a particular case I allude to the 
 first establishment of the Bank of North America. If this had been intended to 
 decide this very important question, without any reservation of their power 
 in other cases, they would have expressed it in the most positive and unequi- 
 vocal manner. 
 
 Sir, it may be asked, how did the Congress, whilst acting under the "Ar- 
 ticles of Confederation," incorporate the Bank of North America, though 
 their powers were no more extensive than those of the present Congress? We 
 shall not lose by this investigation; they declared, that "the exigencies of the 
 United States rendered it indispensably necessary that such an act be imme- 
 diately passed;" and, at that period the Board of War confessed they had not 
 money sufficient to pay the expense of forwarding an express to the Com- 
 mander-in- Chief of the army ! Notwsthstanding such urgent necessities on the 
 part of the General Government, they were too conscious of the rights of the 
 States, to attempt an usurpation of authority, or to pretend to force this act 
 without their sanction; accordingly, we find the resolution by which this bank 
 was established, followed by another, which recommended to the Legislature 
 of each of the States the necessity to pass such laws as they judged requisite 
 for giving the ordinance by which the subscribers of the Bank of North Ame- 
 rica were incorporated, its full operation; every provision in the charter of 
 this bank, to have full effect, was recommended to the Legislatures of the se- 
 veral States, for their approbation. See Journals of Congress for 1781, vol. 
 7//t, pp. 257 and 258. 
 
 It is a well known and an important fact, that the subscribers to the Bank 
 of North America did not rest satisfied of the authority of Congress to incor- 
 porate them: subsequently to the original act of incorporation, they accepted 
 from the Legislature of Pennsylvania a charter, by which their privileges were 
 very much abridged. 
 
 Some maintain, the States having made it penal to pass counterfeits of the 
 notes of the United States Bank, is in proof of their recognizing the constitu- 
 tionality of the institution. No one will pretend, that these laws were in- 
 tended other than to guard the people against fraud; these statutes were en- 
 acted without any connexion with, or reference to, the principle upon which 
 the original act was founded. It is but too well known, notwithstanding these 
 salutary provisions, that counterfeit bank notes, of every denomination, are 
 in daily circulation. I will ask, what would be the case if such laws had not 
 been passed by the States? Sir, if it requires all our care to prevent an inun- 
 dation from such bank paper, as is acknowledged to be genuine, for Heaven's 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 sake, do not risk the security of the people, by an indirect sanction of such 
 as is known to be spurious. 
 
 I have often heard the constitutionality of a national bank defended, upon 
 the ground of its being absolutely necessary to the fiscal operations of the Ge- 
 neral Government. A friend from New York, [Mr. FISK,] said he " would 
 demonstrate, that this institution was indispensably necessary to the fiscal 
 concerns of the Government." I confess if he could do this, he would go far 
 to remove an important difficulty. If there be higher authority, whereon to 
 rely for his proofs, than the officer who is at the head of your Treasury De- 
 partment, he might have succeeded; I pledge myself upon the statements of 
 this officer to demonstrate, that this bank is not even necessary* for the fiscal 
 operations of the Government. Upon this plea, it is attempted to be justified 
 by the 17th article of the 8th section of the constitution of the United States, 
 \vhich gives to Congress the power "' to make all laws which shall be neces- 
 sary and proper for carrying into execution" the several specific powers dele- 
 gated to Congress by the States. I never did doubt for a moment, the con- 
 venience of a bank, to the moneyed transactions of the Government. I was 
 often induced to believe, that a bank, sanctioned by the General Government* 
 was necessary for these purposes. 1 am now confirmed in a very different 
 sentiment by th-; treasury report, made the third of January, 1811. In the llth 
 page of that report, we are told, it is one of the duties which are assigned to a 
 clerk in the Treasurer's office, to keep a " bank cash b:ok, wherein an ac- 
 count is opened with every bank in which the United States have money de- 
 posited, in 1798, the number of these were./Vrf: they are now augmented to 
 twenty."* The establishment, constituting the United States Bank, and its 
 branches, consists, in all. of nine banks; consequently, by the statenient just 
 made, it is proved the Treasury Department has been doing business with 
 eleven banks, other lhan those sanctioned by Congress. The same report 
 states, that this business is transacted in all the banks upon precisely the same 
 plan. We have never been told of any losses having been sustained in any 
 of them. Why, then, pretend, that it is impossible to transact this business 
 through the agency of the State banks, when we have the best authority for 
 asserting, that this has been done already in a majority of cases, with the 
 greatest success, facility, and certainty? That no advantages, which are pe- 
 culiar, can be derived to the nation, from the United States liank, as respects 
 the collection of the revenue, the safe keeingof its specie, or the transmission 
 of its moneys from place to place, will be made evident by the same excellent 
 authority. It is there stated, that considerable sums, to the credit of the. 
 Government, are deposited in the State banks, even in cities where the mother 
 bank and its branches are situated. On the 7th of January, 1811, very consi- 
 derable sums belonging to the Government, remained in the Manhattan Hank 
 of New York; the Bank of Pennsylvania, in Philadelphia: and the Hank of 
 Columbia, in Georgetown, District of Columbia. As to the transmission of 
 money, we are told in the same report, that the deposites in the Manhattan 
 Bank arise from collections of the revenue* in the States of Rhode Island and 
 Connecticut; and that those in the Bank of Pennsylvania, occur from the pay- 
 ments which are made for public lands, into the banks of Ohio and Kentucky; 
 from these, it is transmitted to the branch bank of Pennsylvania, at Pit tabu rg, 
 and thence it passes to the Hank of Pennsylvania, in the city of Philadelphia, 
 where it remains subject to the drafts of the Treasurer. From this we per- 
 ceive, that collections and transmissions of money, for the benefit of the Go- 
 vernment, arc made without the aid of the United States Bank, or its branches, 
 and that through a considerable extent of country, from one extremity of the 
 States to the other. After this, will any one pretend to urge the absolute 
 necessity of the United States Bank? 
 
 It is said, all agree that banks are necessary for the collection of taxes; but 
 that of the United States is not absolutely necessary for this purpose, since 
 
 these operations can be, and have been performed for the General Government, 
 
 by tin, State banks. Sir, 1 deny the position, and will maintain that for this 
 purpose, JK> bank whatever is required. [ will ask gentlemen who maintain this 
 
16(3 BANK OF THE UNITED STATES. 
 
 doctrine, to name to me the banks which are employed to collect the taxes, 
 which are levied by the States? 1 know of none, and 1 believe it impossible 
 to point out a single instance, where the States make use of their agency. 
 
 Sir, I will for a moment permit myself to suppose, notwithstanding the 
 well founded objections to the establishment of a bank under the authority of 
 the General Government, Congress shall nevertheless deem it expedient to 
 renew the charter of the present United States Bank, or establish, what some 
 may fancifully reconcile to themselves, by the title of a national bank, it then 
 becomes a question, how the States will receive the act? Whether they can- 
 not render its provisions abortive? That many of the States are hostile to a 
 bank, authorised by the General Government, is evident, from numerous facts; 
 for proofs we may refer to the acts of the Georgia Legislature, by which, the 
 bank capital of me branch at Savannah, w r as made liable to taxation: North 
 Carolina has taxed the capital of her banks: the Legislature of New Jersey, 
 passed but a single act at their last session; that was to levy a tax on bank 
 capital. No one can pretend, that the disposition of Virginia or Maryland, 
 is very favorable to a pretended national bank. 1 can state, upon the best au- 
 thority, that it was a subject of consideration with the Legislature of Penn- 
 sylvania, during the last winter, to tax the capital of the mother bank in Phi- 
 ladelphia. They did not proceed, because they relied on the refusal of Con- 
 gress to renew the present charter of the United States Bank. The taxation 
 of the capital stock of this bank, is to be looked for on the part of the States 
 in which the mother bank and its branches may be established; because, the 
 States generally require a bonus, or in other words, they raise a tax from the 
 banks, which they themselves have sanctioned; in many instances, the amount 
 has been very considerable. We cannot suppose the States will hesitate to 
 tax the United States Bank; because if they do, they will act unjustly towards 
 such of their immediate citizens, as have invested their capitals in the stock 
 of State banks; a partial taxation is contrary to the spirit and letter of our 
 constitutions. The States haying the right to tax the institutions, which you 
 may sanction within their jurisdiction, they have it in their power to render 
 inoperative the statutes which you may enact on this subject; they may tax 
 to an amount, which shall equal the dividends arising upon the capital. Who 
 can pretend, that banks will do business without the prospect of a handsome 
 profit? Thus disposed, the States may place the United States in a very un- 
 pleasant situation. Let us]avoid every possible source of discord. The General 
 Government may be reduced to the dilemma, either to relinquish a pretended 
 right, or to pay tribute to the States, to permit them to exercise an authority 
 which is unquestionably an attribute of sovereign power. This would consti- 
 tute an epoch in the political annals of our country. I hope such absurdities 
 will not be committed; we may avoid them, by a strict compliance with the 
 principles of the constitution of the United States. 
 
 JANUARY 18, 1811. 
 
 Mr. BURWELI/S motion to strike out the first section, still depending: 
 
 Mr. P. B. PORTER spoke in favor of it, as follows: 
 
 Mr. CHAIRMAN: As this bank has excited so extraordinary an interest in 
 every part of the United States, and particularly in the State which 1 have 
 the honor to represent; as I am apprehensive, from what took place yester- 
 day, that I shall be found, on this question, in opposition to a majority of my 
 colleagues; and, (what will always be an imperative motive with me) as I 
 think this bill aims a deadly blow at some of the best principles of the consti- 
 tution, I feel it my duty to state to the House the grounds on which I shall 
 be constrained to vote, for striking out the section now under consideration. 
 
 1 acknowledge that 1 had not, until lately, paid any particular attention to 
 the question of the constitutionality of this institution. I stand, therefore, in 
 this respect, on safer ground than the respectable member from North Caro- 
 lina, (Mr. MACON) for I have no reason to suspect myself of any long-rooted 
 prejudices on the question. The Bank of the United States was established 
 
0> T THE BILL TO RENEW THE CHARTER OF 1791. 
 
 at a time when I was not in the habit of troubling myself with such questions. 
 I had been accustomed to think of it as an institution, the constitutionality of 
 which ^yas conceded by common consent. But, sir, when the question was 
 again stirred, I felt it my duty to give it a thorough investigation before I 
 should sanction it by my vote. I have given it, if not a thorough, at least a 
 candid and impartial examination; and the result has been, a full conviction 
 that we have no right to incorporate a bank upon the principles of the bill on 
 the table; or, rather, upon the principles of the original charter, which this bill 
 proposes to renew. The ground of my objection is, that it assumes the exer- 
 cise of legislative powers which belong, exclusively, to the State Govern- 
 ments. 
 
 I shall not touch the question of the expediency of this bank, much less the 
 expediency of banking generally. If I were competent, which I confess I am 
 not, to the task, I should think it a verv unprofitable one, to follow the gen- 
 tleman through all the mazes of the banking system; a system, sir, about the 
 various and important operations, and effects of which, on civil society, aside 
 from a few obvious truths which it furnishes, I have found that those gentle- 
 men who have professed to understand them best, have differed most. As I 
 propose to confine myself to the constitutional question solely, I hope I shall 
 be allowed to take a little broader range en this point, than has been taken by 
 the gentlemen who have preceded inc. 
 
 I am aware how ungracious constitutional objections to the powers of this 
 House, are with those, (and there are many such) who believe that the powers 
 of the Federal Government are, at best, too contracted, and who would be glad 
 to see all the State rights merged and sunk into a consolidated government. 
 Whatever may be my speculative opinions on this subject, I can never be in- 
 fluenced, by motives of expediency, to swerve from my allegiance to the con- 
 stitution. This sentiment is indelibly fixed on inv mind, and I trust it is a 
 common one to the members of this committee, that, in adhering strictl^ to 
 the obligation we have taken, to support the constitution of the United States, 
 we not only perform a sacred duty to ourselves, but we render a better ser- 
 vice to the real and permanent interests of our country, than we could po>si- 
 bly render by a departure from that obligation, even though that departure 
 were to avert so serious a calamity as ageneral bankruptcy; a calamity, which, 
 in order to alarm the timid, has been held out as the inevitable consequence 
 of a refusal to renew this charter. 
 
 I should be surprised at the general acquiescence which seeing to have been 
 yielded to the constitutionality of this institution, did I not believe that others 
 had been as superficial in their examination of the subject as I had myself. 
 When objections are made to the constitutionality of a law, the people, in the 
 cursory views which they are accustomed to take of such objects, are apt to 
 adopt, as the tests of its constitutionality, the powers of the State and Fede- 
 ral Governments, cojlectively; and if they find nothing in the law offensive to 
 the principles of civil liberty, nothing uncongenial with the spirit of a repub- 
 lican government, they rest satisfied, and do not trouble themselves with nice 
 distinctions between the powers peculiar to the one or the other of these go- 
 vernments. Such reasoning would, however, ill become the sagacity of this 
 House. 
 
 One of the most serious dangers with which our Government is threatened, 
 and it is a danger growing out of the very nature and structure of the Govern- 
 ment itself, consists in its tendency to produce collisions between State and 
 Federal authorities. The Federal Government, as was observed by my learned 
 colleague, (Mr. MITCHILL) is, imperium inimperio, a government within a go- 
 vernment; and the misfortune is, that there exists no friendly third power to 
 
 preservation ot both these govern- 
 ments as we are as well the subjects of the iinperio as of the imperium, we 
 ought to act with great circumspection and delicacy, in the assumption of pow- 
 
BANK OF THE UNITED STATES. 
 
 ers which do not clearly belong to us. It is better to forego the exercise of 
 powers to which we are entitled, if the exercise of them is not very import- 
 ant, rather than hazard the assumption of doubtful ones, the fatal consequen- 
 ces of which my honorable friend from Virginia. (Mr. BURWELL) has so just- 
 ly deprecated. 
 
 The great line of demarcation between the powers of the State and Federal 
 Governments, is well understood. The powers of the State Governments ex- 
 tend to the regulation of all their internal concerns, those of the Federal Go- 
 vernment to the management of all our external rejations external, as regards 
 the individual States, as well as the States in their collective capacity. The 
 general ideas upon which our republic is founded, are these: that small terri- 
 tories are better adapted to the successful administration of justice than large 
 ones. In a Republic, where the people are the sovereigns and source of pow- 
 er, it is important that, in order to enable them to execute this power discreet- 
 ly, they should possess correct information in relation to the character and 
 conduct of their rulers, and in relation, also, to the character of the measures 
 which they pursue, or ought to pursue; and this information is better attained 
 in a small than in a large territory. The individual States, have, therefore, 
 reserved to themselves the exclusive right of regulating all their internal, and, 
 as I may say, municipal concerns, in relation both to person and property. 
 But a single State maybe inadequate to its own protection against foreign vio- 
 lence; it may also be unable to enforce the observance of proper rules and 
 regulations tor carrying on its foreign trade and intercourse. The confederacy 
 of the States is, therefore, formed for the purpose of attaining these two ob- 
 jects, namely, the regulation and protection of the trade and intercourse of the 
 States with each other, and foreign nations, and their security against foreign 
 invasion. It has some other objects in view of minor consequence, and imme- 
 diately connected with these principal ones. The constitution of the United 
 States is the basis of thh confederacy, and it is only necessary to read the 
 constitution to perceive that it is nothing more than a delegation of specific 
 powers for these specific purposes, ami that the general sovereignty of the 
 States over their respective territories, is expressly retained by the States. 
 
 But, sir, independent of these specific powers and duties of the Federal Go- 
 vernment, it has another and distinct set of powers and duties to perform and 
 execute. The national domain, as it has been called, embracing the lands ac- 
 quired by the revolutionary conflict, the lands since purchased of foreign na- 
 tions, and the lands ceded by the several States to the General Government, 
 belong to the United States, in their federate capacity; and no individual 
 State, as such, has any claim to, or jurisdiction over them. As to these lands, 
 the powers of the United States are sovereign, independent, and complete, 
 
 for ' 
 
 ments, in relation to the States. I have adverted to this branch of the powers 
 of the Federal Government, as a means of dispelling the obscurity which has 
 been thrown over the constitutional question, to which I shall soon come, by 
 confounding the powers of Congress over the States, with their powers over 
 the Territories. Arguments, to which I shall have occasion to advert, in the 
 course of my observations, have been used to justify the exercise of particu- 
 lar powers Within the limits of the States, from our acknowledged nght to, 
 and practical exercise of, similar powers within the Territories. 
 
 In discussing constitutional questions, then, we may lay down these 
 axioms That in relation to the Territories, the powers of Congress are su- 
 preme and exclusive: that in relation to the State, they are specifically de- 
 fined and limited by the constitution; and that we have no right to exercise, 
 within the limits of a State, any power as resulting from the general rights of 
 sovereignty; because that sovereignty belongs to the States and to the People, 
 and not to the Federal Government. To show that these two last positions 
 are correct, I will read the tenth article in amendment of the constitution: 
 " The powers not delegated to the United States by the constitution, nor pro- 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 hibited by it to the States, ire reserved ites respectively, or the 
 
 People,"" 
 
 . then, the incorporation of this bank involves the exercise of legislative 
 powers within the jurisdiction of t - .in relation to the rights of proper- 
 ty between the citizens of th< : and as no power to incorporate a bank 
 nomine is to be found in the constitution, it would seem sufficient for us 
 to rest the argument here, by a mere denial of the power: and to call on the 
 advocates of the bank to show its constitutionality. An attempt to prove this 
 constitutionality has been made: not, however, >ir. by arguments advanced 
 
 :itJemen on the other side of the House in their places, (for they have, 
 so tar, observed, and I understand that they will continue to observe, a pro- 
 found silence on this question.") but by arguments which have been gratuitous- 
 
 roduced, by t ; f the bank. T allude to the pamphlet, which has, 
 
 within a few day? past /been printed and distributed among the members, con- 
 taining the celebrated argument of General Hamilton, on the constitut 
 ality of a national bank if pamphlet is de facto* if not dcjitrc, before 
 
 the committee. I will, if the i will indulge me. attempt to examine 
 
 some of the principal argurm ..ned in IT. uial I will also notice some 
 
 additional ones, advance .y by my honorable friend ami colleague on 
 
 my left. (Mr. FISK.) In thecourse of the" observations which I have to sub- 
 mit, I shall, without doubt, n- uentsand remarks made by the gentle- 
 men who I, s which are famil nembersof the 
 commit tee. M . ; the difficuhv of taking a connected view of 
 the subject, without s>uch rep- -.mate as to throw a 
 single new ray of light on this important cnie-- . I -hall feel amply remune- 
 ouble, and I >hall think the time of the committee not alto- 
 T misspent. 
 
 The first argument in this pamphlet, is founded on the sovereignty of the 
 powers of Congress- The Federal Government is sa ! vereign, a* to 
 
 all the objects/or which that Government tea* instiiuled, A sovereign nouer 
 inch: :ce of the term, a right to all the means applicable to the at- 
 
 tainment ot the ends for which \ -. and ther ' ] oF&& 
 
 in virtue of their - jr, create incorporations for attaining 
 
 is or otyc 
 
 This argument i> founded on what the logicians call petitio principii, or, 
 
 'if question. The proposition, that the Government is sovereign, is 
 
 assumed, to prove that it possesse- the attributes of sovereignty: or, in other 
 
 words, the fact of sovei- '-d. to prove that sovereignty. If the 
 
 position, that the power? oT this Government are sovereign, as to all the objects 
 
 of them, be proved. I will concede the consequence, to wit: that we have a 
 
 ; Derations to attain those objects. But I deny the fact of 
 
 The acts of Congo - .id, are declared by the con^titu- 
 
 tion, to be the supreme law of the land:" and the power which can make the 
 
 supreme law of the land, is, necessari! ei^n?power. Bull deny that 
 
 - a correct definition, or exposition o: _ ity. It is not the high 
 
 nature of an act, nor the authority of the act. that stamps the character of 
 sovereignty en him who performs it. The sheriff'of a county, who puts a man 
 to death, under^the sentence of the law, executes an act of as high import and 
 authority as human power can execute: and yet the sheriffof a county is not, 
 therefore, a sovereign. His authority is a mere dekgated authority: h'is act is 
 a mere ministerial, mechanical act. "The ido eignty imports the exer- 
 
 t discretion of judgment of will. It is oft ->ence of - 
 
 reign power, that you may^ execute that power, or not execute it: that you 
 may execute it when you will, and how you will. A sovereign power, as to 
 any object, includes a right to any means", and all the means applicable to the 
 attainment of theobject/ But. >iV. do i -s sovereign powers; or, 
 
 what is the same tiling, discretionary means, as to the attainment of the ob- 
 jects of this Government? No. sir. The constitution is not a general authority 
 to Congress to attain the objects for which the Government "was established; 
 but it is an enumeration of the particular powers, or means, by which, and by 
 
170 BANK OF THE UNITED STATES. 
 
 which only, certain objects are to be accomplished. If the powers of Con- 
 gress were sovereign, they would of necessity comprehend all the means ap- 
 plicable to the attainment of their objects; but, inasmuch as they are specific 
 and circumscribed, that very circumstance proves that they are not sovereign. 
 The People of the United States are the true sovereigns of this country. 
 From them all power emanates, and on their will all the authority of this Go- 
 vernment depends. The powers of the Federal Government are mere dele- 
 gated chartered authorities; and in the exercise of them, we are tied down to 
 the letter of the constitution. We have, to be sure, a certain latitude of dis- 
 cretion allowed us, within the letter and pale of the constitution; and, so far, 
 we may be said to possess a sort of limited, qualified sovereignty. But the 
 constitution is the standard by which to measure the quantum and extent of 
 pur sovereignty. And our sovereignty, which is the result of the powers given 
 in the constitution* is not the standard by which to measure the constitution. 
 The constitution is the true bed of Procrustes; and our sovereignty, however 
 unwillingly we may yield it, must be the victim. 
 
 Another argument, which is rather an argument to the favor, than to the righf 
 of this bank, is, that it is an. innocent institution; that although its erection 
 involves the exercise of legislative powers within the States, it does not 
 abridge nor affect the rights of the citizens, as secured to them by the laws of 
 those States. A corporation, it is said, is a fiction of the law a mere politi- 
 cal transformation of a number ot individuals from their natural into an arti- 
 ficial character,, for the purpose of enabling them to do business to better ad- 
 vantage, and on a more extended scale: but, that, when this political associa- 
 tion, this legal entity, is once formed, it becomes subject to the laws of the 
 State in which it happens to be placed. 
 
 I know, sir, that there is nothing formidable in the abstract idea of a cor- 
 poration. It is a mere phantom or the imagination; invisible, intangible, and, 
 of course, innocent. But, sir, when the legal effects of this incorporation are, 
 to invest the individuals whom it associates^ with privileges and immunities 
 to which they were not before entitled^ when this legal hction is interposed 
 to shield certain individuals from <he liabilities to which they would be sub- 
 ject as ordinary citizens, it then becomes a matter of important and serious 
 consequence. What are some of the legal effects of this incorporation? 
 
 One of its most obvious and distinguished characteristics is,, that it exempts 
 the private property and persons of the stockholders from all liability for the 
 payment of the debts of the company. By the laws of every State in the 
 Union, every man is, I believe, liable for the payment of his debts, to the full 
 amount of his private fortune; and, in case that fortune prove insufficient, his 
 personal liberty is at the disposal of his creditor; at least, to a certain extent. 
 Is not, then, the exemption from these liabilities an important immunity? Is 
 it not an exclusive privilege secured to the stockholders of this bank? Assur- 
 edly it is. I know it has been said, that a number of individuals may, by a 
 private association, secure to themselves all the advantages of an incorporated 
 company f that, by forming a common fund or stock, upon which to do busi- 
 ness, and issuing notes chargeable upon that fund, they may exonerate their 
 persons and private property from all liability for the payment of the debts 
 contracted in that business.. I am no lawyer, sir; but if the law be, what it 
 is said to be, and what I believe it to be, siimma ratio^, then I pronounce this 
 doctrine not to be law: for nothing can be more preposterous in principle than 
 to say, that a man may, by his own act, avoid the force of an obligation, 
 which the law has made universal and unqualified. If a man owes a debt,, 
 acknowledges he owes it, and has received a consideration for it; the law has 
 prescribed the nature anil extent of his liability to pay it;, and it is not for him 
 to say that it shall only be paid out of a certain fund,, or particular part of his 
 property, and no other. When men contract a debt jointly, the legal obliga- 
 tion to pay it, extends as well to the persons and separate property of the in- 
 dividual partners, as to their joint property. 
 
 Another feature of this incorporation is, that it authorizes the stockholders 
 to take usurious interest for their money. By the provisions of the law, the 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 bank may issue notes and make discounts to double the amount of their capi- 
 tal stock; and, in addition to that, to the amount of any moneys which may 
 happen to be deposited in their vaults for safe keeping; and this, too, inde- 
 pendent of the debts created by these deposites. Thebank then may, and in 
 fact, in many instances, does, draw an interest on three or four times its capi- 
 tal. Every State in the Union has laws regulating the rate of interest, and, 
 in most of the States, this rate is fixed at six per cent, a year. By these laws, 
 it is made penal for a man to receive more than six per cent, interest for the 
 use of any sum of money, which, by a loan, he puts at hazard, and the use of 
 which he deprives himself of. Now, sir, this bank is permitted, contrary to 
 those laws, to draw an interest on twenty or thirty millions of dollars, when, 
 in truth, the whole extent of its responsibility, the whole sum which it puts at 
 hazard, and the use of which it foregoes, is only its original stock often mil- 
 lions. In answer to this, it will be said, that an individual may, by issuing 
 notes to an amount greater than his property, legally receive an interest on a 
 capital which he does not possess. But, it must be recollected, in case of the 
 individual, that, although he may not, at the particular time, possess a pro- 
 perty adequate to the payment of his debts, yet, that all the property which 
 he may subsequently acquire, will be liable for the payment of those debts: 
 And, what is more, sir, his personal liberty is always put in jeopardy. In this 
 point of view, the liability and the hazard of the individual may fairly be said 
 to be co-extensive with the whole amount of the capital on which he draws an 
 interest; and which is often the case with the bank. 
 
 This bank incorporation possesses other qualities at war with the laws of the 
 several States, one of which is, that it authorises stockholders, who may be 
 foreigners, to hold real estate. But, sir, I will not detain the committee any 
 longer on this part of the argument: for this institution cannot be said to be 
 innocent, as regards the rights of the States, when its effects on the rights of 
 property are to exonerate the stockholders from some of the most important 
 responsibilities which the laws of the several States have provided for the pay- 
 ment of debts; and when it authorizes the taking of usurious interest. I lay 
 it down, then, asa position which cannot be controverted, that the granting of 
 this charter is not only an inteference with the municipal regulations of the 
 several States, in relation to the rights of property, but that it is an uafraction 
 of the rights of individuals as secured by those regulations. 
 
 But, it is contended, that a right to incorporate a bank of the United States 
 is delegated to Congress by the constitution: and five or six different pro- 
 visions of the constitution are referred to as giving this right. It is said, that 
 it is implied in the power to lay and collect taxes \n the power to borrow 
 money in the power to regulate trade and intercourse between the several 
 States in the power to provide for the general welfare and in the power to 
 make all needful rules and regulations respecting the territorial and other pro- 
 perty of the United States. The very circumstance of referring this right to 
 many different heads of authority, is, in itself, conclusive evidence, that it has 
 no very direct relation to any ot them: for it can scarcely be imagined, that 
 the single act of incorporating a bank, can be, at the same time, anything like 
 a direct execution of so many and such distinct and independent powers. But 
 I will examine these provisions separately. 
 
 Before I proceed, however, I will premise, that all the arguments in support 
 of the right to incorporate a bank, as deducible from the provisions of the con- 
 stitution itself, are built up by the aid of the clause of the constitution, which 
 has been sometimes called "the sweeping clause." I allude to the clause 
 which declares that Congress shall have me right to pass all laws necessary 
 and proper for the carrying into execution the delegated powers. All the 
 powers in the constitution are given for certain ends or objects. But each 
 power is not a general authority to attain a particular object, and comprehend- 
 ing, of course, all the means or powers aplicable to its accomplishment; but. 
 in most instances, it is a specific mean for effecting some particular end, and 
 all other means or powers, (for means and powers are the same thing,) conducive 
 
172 BANK OF THE UNITED STATES. 
 
 to the same end, are expressly excluded, by the restrictive clauses of the con- 
 stitution. 
 
 The mode of reasoning adopted by General Hamilton, and the other advo- 
 cates of implied powers, is this: They first search for the end or object for 
 which a particular power is given; and this object will be an immediate or 
 ultimate one, as may best suit the purpose of the argument. Having ascer- 
 tained the end or object, they abandon the power; or, rather, they confound 
 the power and the object of it together, and make the attainment of the object r 
 and the execution of the power given to accomplish it, convertible terms. 
 Whatever, they say, attains the object for which any power is given ? is an 
 execution of that power. But the constitution gives to Congress a right to 
 make all laws necessary and proper for carrying into execution the delegated 
 powers: and, therefore, as the execution of a power, and the attainment of its- 
 object, are synonymous terms, the constitution gives to Congress a right to 
 make all laws necessary and proper for attaining the ends or objects for which 
 the various powers in the constitution are given, 
 
 I beg leave to read a passage from this pamphlet: " The relation between 
 the measure and the end; between the nature of the mean employed towards 
 the execution of a power, and the object; must be the criterion of constitu- 
 tionality." Here, then, is the axiom: Now for the application of it. The 
 constitution git es to Congress the power to levy taxes, and also the power to 
 borrow money. But the establishment of a bank is neither levying taxes nor 
 borrowing money ; nor is the law incorporating the bank, a /aw'tolevy taxes y 
 or a law to borrow money. But the immediate end or object, for which these 
 two powers were given, was, to enable the Government to raise a revenue j 
 and a bank may promote this object. Then,, sir, by a dexterous application, 
 of the argument which I have stated, the fallacy of which consists in the sud- 
 den and unobserved transitions which are made from the power to the object r 
 and from the object back again to the power, they prove that the establish- 
 ment of a bank is in execution of the powers to lay taxes and to borrow money. 
 I will now, sir, proceed to examine the particular provisions of the constitu- 
 tion which have been relied on, and to place the subject in some different as- 
 pects. 
 
 In the first place, then, it is contended that the right to incorporate a bank 
 of the United States, is included in the power to lay and collect taxes. And 
 how is the argument by which this position is maintained? Why, sir, it is 
 said that the law, by creating bank paper, and making that paper receivable 
 in payment for taxes, increases the circulating medium in which taxes are 
 paid, and, of course, must facilitate the payment of them: that whatever faci- 
 litates the payment of taxes, facilitates also the collection of them; arid what- 
 ever aids or tacilitates the collection of taxes, is a means for their collection. 
 And, therefore, the incorporation ot a bank is in execution of the power to lay 
 and collect taxes. 
 
 No man, sir, ought to complain of the weakness of a government, whose 
 powers may be reasoned up by logic like this, Amidst the infinite variety of 
 relations, and connexions, and dependencies, and analogies, by which all hu - 
 man transactions are allied to each other, he must be a weak politician who 
 cannot, by hooking together a chain of implication like this, justify any and 
 every measure of political policy or economy, as a means of executing some 
 of the powers with which tliis Government is intrusted. Take this latitude 
 of implication or construction, and you want no other power but the power 
 to lay and collect taxes. It may be tortured into a justification of every mea- 
 sure which ambition itself could desire. No tyrant ever made a law without 
 assigning the public good as the motive of it. No man on this floor, however 
 wicked his designs, would venture to propose a measure, (indeed few could 
 be proposed) in t'avor of which he could not adduce some plausible argument, 
 to shew that it would tend to promote the general prosperity of the country. 
 And in showing this, he would show its constitutionality; for it is demonstra- 
 ble, that whatever would promote the general prosperity of the country, 
 would, and tor that very reason, facilitate, in some greater or less degree, the 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 payment of taxes; and might, therefore, be justified as a means for the col- 
 lection of taxes. 
 
 But, sir, the constitution, as I have said before, and I must repeat it again 
 for this is the radical source of all the error on this subject the constitution 
 of the United States is not, as such reasoning supposes it to be, a mere gene- 
 ral designation of the ends or objects for which the Federal Government was 
 established; and leaving to Congress a discretion as to the means or powers 
 by which those ends shall be brought about. But the constitution is a spe- 
 cification of the powers or means themselves by which certain objects are to 
 be accomplished. The powers of the constitution, carried into execution ac- 
 cording to the strict terms and import of them, are the appropriate means, and 
 the only means within the reach of this Government, for the attainment of its 
 ends. It is true, as the constitution declares, and it would be equally true 
 if the constitution did not declare it, that Congress have a right to pass all 
 laws necessary and proper for executing the delegated powers: but this gives 
 no latitude of discretion in the selection of means or powers. A power given 
 to Congress in its legislative capacity, without the right to pass laws to exe- 
 cute it, would be nugatory; would be no power at all: it would be a solecism 
 in language to call it a power. A power to lay and collect taxes, carries with 
 it a right to make laws for that purpose; but they must be laws to lay and 
 collect taxes, and not laws to incorporate banks. If you undertake to justify 
 a law under a particular power, you must show the incidentally and appli- 
 cability of the law to the power itself, and not merely its relation to any sup- 
 posed end which is to be accomplished by its exercise. You must show that 
 the plain, direct, ostensible, primary object and tendency of your law is to 
 execute the power, and not that it will tend to facilitate the execution of it. 
 It is not less absurd than it is dangerous, first, to assume some great, distinct, 
 and independent power, unknown to the constitution, and violating the rights 
 of the States; and, then, to attempt to justify it, by a reference to some re- 
 mote, indirect, collateral tendency, which the exercise of it may have towards 
 facilitating the execution of some known and acknowledged power. This 
 word facilitate, has become a very fashionable word in the construction of 
 powers; but, sir, it is a dangerous one; it means more than we are aware of. 
 JTo do a thing, and to facilitate the doing of it, are distinct operations; they 
 are distinct means; they are distinct powers?. The constitution has expressly 
 given to Congress, the power to do certain things; and it has, as explicitly, 
 withheld from them the power to do every other thing. The power to lay 
 and collect taxes is one thing; and the power to establish banks, involving in 
 its exercise the regulation ol the internal domestic economy of the States, is 
 another and totally distinct thing; and the one is therefore not included in 
 the other. 
 
 Again, sir, it is contended tint the right to incorporate a bank is implied in 
 the power to regulate trade and intercourse between the several States. It 
 is said to be so, inasmuch as it creates a paper currency, which furnishes a 
 convenient and common circulating medium of trade between the several 
 States. Money, sir, has nothing more to do with trade, than that it furnishes 
 a medium or representative of the value of the articles employed in trade. 
 The only office of bank bills is to represent money. Now, if it be a regulation 
 of trade, to create the representative of the representative of the articles or 
 subjects of trade, a fortiori, will it be a regulation of trade to create the arti- 
 cles or subjects themselves. By this reasoning, then, you may justify the right 
 of Congress to establish manufacturing and agricultural companies within the 
 several States; because the direct object and effect of these would be, to in- 
 crease manufactures and agricultural products, which are the known and 
 common subjects of trade. You might, with more propriety say, that, under 
 the power to regulate trade between the States, we have a right to incorporate 
 canal companies; because canals would tend directly to open, facilitate, and 
 encourage trade and intercourse between the several States; and, in my hum 
 ble opinion, sir, canals would furnish a much more salutary, direct, and effi- 
 cacious means, for enabling the great body of the people to pay their taxes, 
 
174 BANK OF THE UNITED STATES. 
 
 than is furnished by banks. But, sir, these various powers have never been 
 claimed by the Federal Government,' and, much as I am known to favor that 
 particular species of internal improvement, I would never vote to incorporate 
 a conipany for the purpose of opening a ranal through any State, without first 
 obtaining the consent of that State, whose territorial rights would be affected 
 by it. There can be no question, but canal companies, and agricultural com- 
 panies, and manufacturing companies, and bunking companies may all tend, 
 more or less, to facilitate the operations of trade; but they have nothing to do 
 with the political regulations ot trade: and such only come within the scope 
 of the powers of Congress. 
 
 But, it is again said, that the right to grant this charter, is included in the 
 power to borrow money. The right is attempted to be deduced by a train of 
 reasoning similar to that employed in relation to the provisions which I have 
 already noticed. By forming a string of implications, by which you prove 
 that a power to act in certain cases, and in relation to certain subjects, implies 
 the power to create those cases and subjects to act upon. The Government, 
 it is said, may want, and must have money^ in any great national crisis. A 
 national bank, with an extensive capital, will furnish ample means for loans; 
 will facilitate the exercise of the power to borrow; and, therefore, the right to 
 establish such a bank, is implied in the power to borrow. No one, but a logi- 
 cian, sir, would imagine that a power to lend, and a power to borrow, had any 
 relation to each other, much less could lie conjecture, that a power to borrow, 
 and a power to create the ability to lend, mean the same thing. A plain unso- 
 phisticated man, on reading the constitution, would say, that the power to 
 borrow, necessarily and by force of the term, pre-supposed the existence of 
 the ability, and the disposition to lend; and that it could not be exercised un- 
 less such ability and disposition should actually exist. But the favorite doc- 
 trine is, that all powers are given for particular ends, and include all the means 
 applicable to their attainment. Here the end is to borrow money; to borrow 
 honestly if we can, but, TO BORROW. The ability to lend is a necessary means 
 or ingredient toward perfecting the execution of the power to borrow. But, 
 sir, let me ask, whether the disposition to lend be not as necessary a mean to- 
 wards accomplishing a loan as the ability? It unquestionably is. And, of 
 course, by the doctrine that the end justifies the means, you may coerce the 
 will to lend; and this, top, equally, in cases where the ability is created by 
 Congress, and where it is derived from any other quarter. A loan obtained 
 by bringing into fair operation all the implications of this power, would be 
 borrowing in an off-hand style. Such a loan, if effected by Bonaparte, we 
 should call robbery. But in this mild Republic, it would be nothing more than 
 the fair exercise of an implied constitutional power. 
 
 I have pursued this argument thus far, merely for the purpose of showing 
 the absurdities into which this doctrine of implication will lead us. But, 
 suppose, sir, that the argument of the gentlemen on the other side of the ques- 
 tion be correct, as far only as they have carried it, to wit: that the power to 
 borrow, implies a right to furnish the ability to lend. What, I would ask, is 
 the probable fact, as to the facilities which this bank will afford the Govern- 
 ment in borrowing? 
 
 It will be conceded that we shall have no occasion for borrowing, except in 
 case of a war; and if we have a war, the probability is, that that war will be 
 with Great Britain. I say this, not as a party man, sir, but because the inter- 
 ests of that nation, from her situation, and her rival pursuits, will be much 
 more likely to come in collision with ours, than those of any other power. 
 Now, it is a fact, in evidence before the committee, that more than one-half of 
 the stock of this bank belongs to British subjects; and although, as foreigners, 
 they can have no direct agency in the affairs of the bank, yet we well know, 
 that, through the instrumentality of their friends and agents, of whom there 
 are, unfortunately, too many in this country, they may completely control its 
 operations. Now, I would ask, whether it is probable, that British subjects 
 would be willing to lend us money to carry on war against their sovereign? 
 Would they not, on the contrary, exert the immense influence which they are 
 
ON THE BILL TO RENEW THE CHARTER OF 1701. 
 
 said to possess over the moneyed interests of this country, for the purpose of 
 depressing the credit of the country? for the purpose ot crippling the opera- 
 tions of the State banks? and for the purpose of drying up the sources from 
 which the Government might otherwise calculate to derive supplies? But, sir, 
 this has little to do with the question of constitutionality, to which I will again 
 return. 
 
 Another ground upon which the constitutionality of this institution has been 
 attempted to be supported, is, that it is necessary to the regular and success- 
 ful administration ot the finances. There is no question, but this bank, and 
 its branches, afford convenient places for the deposite and safe keeping of the 
 public revenue. It is not to be controverted that they also furnish a safe, 
 convenient, expeditious, and cheap means for the transmission of moneys from 
 one part of the United States to another, as they may be wanted by the Go- 
 vernment. And if these facilities were not to be attained in any other way, 
 I should say it would afford an argument in favor of a bank; not a bank in 
 fringing and violating the rights of the States; but, a bank upon principles 
 consistent with those rights. 
 
 But, sir, is there not, in every State in which there is a branch of the Unit- 
 ed States Bank, also one or more State banks, of equal respectability, and of 
 equal security; at least to the extent of any sum for which they are willing to 
 undertaker These State banks may be used as depositories for the public 
 moneys, and they will be equally sate and convenient. And, if you will give 
 to these State banks the advantages of these deposites, as you have hitherto 
 given them to the United States Bank, they will furnish means for the trans- 
 mission of moneys from place to place, equally safe, convenient, cheap, and 
 expeditious. This object will be attained by connexions which will be formed 
 between the banks of the different States. Such connexions have already, in 
 many instances, been formed. But, they have not been carried to the extent 
 they otherwise would have been, on account of the United States Bank and 
 its branches; between which, there is so intimate and so necessary a connexion. 
 
 But, in answer to this, it is said that, if the Bank of the United States 
 would be constitutional without the existence of the State banks, it is equally 
 so with. That a power which is once constitutionals equally so at all times, 
 and under all circumstances. That a right which must depend for its exist- 
 ence on the will of the State Legislatures, over whom we have no control, is 
 incomplete, and, indeed, as to us, is no right at all. This argument is found- 
 ed on the supposition, that the Federal Government is a complete Govern- 
 ment, containing in itself all the principles and powers necessary for its own 
 operations; which supposi^n is wholly false. The Federal Government does 
 not profess to be complete in itself. It is expressly predicated on the exist- 
 tence of the State Governments; and most ot the facilities for its exercise are 
 derived from the State Governments. It cannot perform even its own pecu- 
 liar powers and functions, without the aid and co-operation of the State au- 
 thorities. How, let me ask you, sir, is your Government constituted? Your 
 Senate is appointed directly by the State Legislatures. Your President and 
 House of Representatives, indirectly, by the same authority. Suppose they 
 should neglect or refuse to make these appointments, can you compel them to 
 do it? No, sir. Can you punish them for not doing it? Not in the least. They 
 may appoint, or not, as they think proper; and it they should neglect, or re- 
 fuse to do it, your boasted complete Government would die a natural death, by 
 its own imbecility. It is not fair, then, to say that a power is constitutional, 
 because the Government would be incomplete without it. It is not fair to 
 say, that what would be constitutional, without the existence of the State Go- 
 vernments, and their appendages, is equally so with. This would prove that 
 you have a right to appoint your own President, Senate, and House of Repre- 
 sentatives. It would go to usurp all the powers of the State Governments: 
 for the Government could not be said to be complete, without possessing the 
 powers of both Governments combined. Indeed, this Federal Government 
 cannot be said to be complete, as to a single power, without all the auxiliary 
 powers of the State Governments: for there is not a single act which it can 
 
176 BANK OF THE UNITED STATES. 
 
 perform without their assistance, directly or indirectly. The very bank law 
 now under consideration, is an illustration of this: for how are the provisions 
 of this law to be enforced; how are the debts which it authorizes to be con- 
 tracted, to be collected, but through the medium of the State courts? The 
 doctrine of perfect rights, then, if it prove any thing, proves too much. If it 
 proves that, in order to manage your revenues, you may establish banks with- 
 in the States, it equally proves, that, in order to carry the provisions of your 
 bank laws into execution, you may establish courts and offices within the 
 States for that purpose. I think, then, sir, I may fairly conclude, that, so long 
 as the State Governments furnish you with all the facilities which you can 
 reasonably require, for conducting your revenues by means of their State 
 banks; so long, it will be unnecessary; so long, it will be improper; and, there- 
 fore, so long, it will be unconstitutional, to invade the jurisdiction of the States, 
 to establish national banks. 
 
 Again: The constitutionality of the bank has been attempted to be main- 
 tained, by a reference to the phrase in the constitution, in relation to the power 
 of Congress to provide for the general welfare. I will read the clause in 
 which this phrase is contained : " The Congress shall have power to lay and 
 collect taxes, duties, imposts and excises, to pay the debts and provide for the 
 common defence and general welfare of the United States." This clause has 
 been erroneously construed by some, to contain a successive delegation of 
 three or four distinct powers, to wit: a power to lay taxes; a power to pay 
 the debts; a power to provide for the common defence and general welfare. 
 If, then, it is said, Congress have power to provide for the general welfare, 
 they may choose the means, which are here not made specific ? but left discre- 
 tionary, for the attainment of that object: and if, in their opinion, a national 
 bank will conduce to that object, they have a right to establish a national 
 bank. But, sir, this is a total misconception of the meaning of this clause of 
 the constitution. Instead of three or four distinct grants of power, this clause 
 contains but one grant of power, namely, the power to raise money by taxes, 
 &c. and all the subsequent parts of the clause, are a mere limitation of this 
 power to raise money; or a specification of the purposes for which money may 
 be collected. That this is not a general authority to Congress to provide for 
 the common defence and general welfare, is instantly discovered by a com- 
 parison of this clause with the subsequent part of this section, which consists 
 of a list, or enumeration of the specific means or powers, by which Congress 
 may provide for the comnion defence and general welfare. And it would be 
 unnecessary and absurd in itself, as well as repugnant to the whole spirit and 
 character of this constitution, to give, first, a general power, and then to de- 
 legate specific powers, all comprehended in the general one. Although I do 
 not think there is any ambiguity in this clause, as it now stands, yet, its mean- 
 ing might, perhaps, be rendered more perspicuous and definite, by altering 
 the phraseology so as to read in this way: " Congress shall have power to lay 
 and collect taxes, duties, imposts and excise, for the purpose of paying the 
 debt, and providing for the common defence and general welfare of the United 
 States; but, (going on again, sir, with a further qualification of the same pow- 
 er to raise money) all duties, imposts and excise, shall be uniform throughout 
 the United States." This, then, is merely a right to raise revenue; and, so 
 far as regards the objects for which revenue may be raised, the powers of Con- 
 gress are discretionary; provided those objects come within the description of 
 providing for the common defence and general welfare. But, so far as regards 
 the means by which these revenues, when collected, shall be applied to their 
 destined objects, we must look to the powers of Congress, as defined and limit- 
 ed in the subsequent parts of this section. In other words, this clause gives 
 plenary powers to raise money; but it gives no powers, I should say political 
 powers, in relation to its application and expenditure. The powers of Con- 
 gress over the money, when collected, in reference to its expenditure, would 
 be the same which an individual possesses over his private property; powers 
 resulting from the nature of property ? and, as regulated by the laws of the 
 State in which it might happen to be situated. I will illustrate my idea by a 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. ^77 
 
 case. Suppose the constitution had given to Congress the power to raise a 
 million of dollars, to provide for a national university. Would it thence 
 follow, that we might go into the State of North Carolina, and take your pro- 
 pertyproperty secured to you t3y the laws of this State to make this es- 
 tablishment upon? Could we take the public property of that State for this 
 purpose? To both of these questions, every man, who understands any thing 
 of the constitution, will promptly answer, no. This power, then, to raise mo- 
 ney, for the purpose of establishing a national university , is only a power 
 to raise money; and, for the means of applying it, we must search for our 
 power in other parts of the constitution. On doing this, we should find that 
 we must erect the university either in the District of Columbia, or in one of 
 the territories over which we have exclusive jurisdiction, or in case we should 
 choose to erect it within the limits of a particular State, \ye must first^ not 
 only purchase the land, but obtain a cession of the jurisdiction from the State 
 Government. The phrase of providing for the general welfare, then, is a 
 mere qualification of the power to levy taxes, and can give no authority in re- 
 lation to banks. 
 
 There is one more^ and I believe but one more, provision in the constitu- 
 tion, which is relied on as authorizing the establishment of this bank. It is 
 this: ; * Congress shall have aright to cfispuse of and make all needful rules 
 and regulations respecting the territory, or other property belonging to the 
 United States." It is said that, in virtue of this provision, Congress have es- 
 tablished the territorial Governments, which are corporations of the highest 
 and most extensive nature, exercising political powers over the person, as well 
 as the property of citizens of the United States: and that no complaint has 
 been made, that Congress has exceeded its authority in this particular. AVhy 
 may we not, then, it is asked, establish corporations to regulate and manage 
 the personal property of the United States, which is coupled in the constitu- 
 tion with the territorial property? The fallacy of this argument consists in 
 not marking the distinction which exists in these two species of property, and 
 the consequent powers of the Government over them. The property which 
 the United States possess in the territorial lands, is not a mere right of soil, a 
 mere usu fruct; but it also includes the right of jurisdiction and sovereignty. 
 It is in virtue of this right of jurisdiction, of those sovereign plenary and ex- 
 clusive powers over the territories, which I noticed in a tormer part of my 
 observations, that these corporations or territorial Governments have been 
 established. On the other hand, our revenues are not only personal property, 
 but a qualified property. They are collected for certain objects, ana are sub- 
 ject in transitu to the local jurisdictions. This argument, then, which is 
 founded on an analogy that does not exist, must fall with the analogy that sup- 
 ports it. 
 
 But, Mr. Chairman, my honorable friend [Mr. FISK] has advanced a new 
 argument in support of the constitutionality of this bank; an argument, not 
 deduced from the provisions of the constitution itself, but founded on pre- 
 scription. He tells us that this bank was originally incorporated by a Con- 
 gress fully competent and qualified to decide on its constitutionality; that its 
 existence is almost coeval with the Government; that it has been counte- 
 nanced by all succeeding administrations; that laws have been passed to en- 
 force the provisions of the original charter; and, therefore, the constitutional 
 question must be considered as settled, adjudicated, and at rest. 
 
 Whatever may be the opinion of the gentlemen of the long robe, I cannot, 
 for myself, yield to this doctrine of prescriptive constitutional rights. It may 
 answer in England, where they have no constitution; or where, rather, as 
 they choose to explain it, immemorial usage, or prescription, are evidence of 
 what their constitution is. It may do in Connecticut (it is not my design to 
 derogate from the respectability of that State, nor of its institutions) it may 
 be good doctrine in Connecticut, where ancient custom and steady habits ARE 
 their constitution. But, sir, such doctrine should never be tolerated in this 
 House, where every member has a printed constitution on his table before 
 him; a constitution drawn up with the greatest care and deliberation; with 
 25 
 
J78 BANK OF THE UNITED STATES. 
 
 the utmost attention to perspicuity and precision; a constitution, the injunc- 
 tions of which, as we, in our best judgments shall understand them, and not 
 as they shall be interpreted to us by others, we are solemnly bound, by our 
 oaths, to obey. 
 
 It is true, that this bank was originally established by a Congress competent 
 to judge of its constitutionality. It is equally true, that a respectable minority 
 of that Congress opposed the passage ot the law, on the ground of its uncon- 
 stitutionally; and, if I have been rightly informed, it is also true, that the 
 then President, General Washington, in giving his sanction to that law, did 
 it with more doubt and hesitation than almost any other act of his administra- 
 tion. It is true, that subsequent Congresses, of different political complex- 
 ions, have passed laws enforcing the provisions of the original charter; and 
 that no attempts have been made to repeal it. But, it is equally true, that all 
 this might be done with the most perfect propriety and consistency, although 
 they totally disbelieved in its constitutionality. I need not state to this House, 
 that this is not a law in the ordinary course of legislation; a law prescribing a 
 common rule of conduct for the government or the citizens of the United 
 States at large; liable to be repealed at any time; and the obligations of which 
 would cease with its repeal. This, sir, is not the nature of the law; but it is 
 a law in the nature of a contract between the Government and certain indivi- 
 duals, and the existence of it was extended to twenty years. The moment 
 this contract was made, and its operations commenced, private rights were 
 vested; and it would have been a breach of national faith to have repealed it. 
 The original Congress had the same right that we have to judge of the consti- 
 tutionality of a law; and having, under that right, passed this law, or made 
 this contract, we are bound to carry it ? as a contract, into execution. As a 
 contract, every successive Congress, ot whatever materials composed, is one 
 party to it; and it is well known that a party cannot violate the obligations of 
 nis own contract; but, on the contrary, is bound to carry them into effect. It 
 was competent in the State Governments to have opposed the execution of this 
 law, on the ground of its unconstitutionally; but, perhaps, under all circum- 
 stances, they acted a wise and discreet part, in not attempting it. The na- 
 tional faith was pledged in the passage of this law. Thre national credit, 
 which it was, at that time, and which, indeed, it is at all times, of the first im- 
 portance to support, was at stake on the faithful execution of this contract: 
 and it was better to suffer for twenty years, under an unconstitutional law, 
 rather than to attempt so violent a remedy a remedy which would have crip- 
 pled the credit of the nation in its infancy;. 
 
 But, sir, because these were proper considerations with our predecessors and 
 the States, to suffer the continuance of this law, does it tollow ? that now, 
 when that law has expired by its own limitation; when the obligations of that 
 contract are complied with and discharged; when the national faith is emanci- 
 pated, that they are motives for us to make a new unconstitutional contract? 
 No, sir. The question now is a question de novo. It is a question of con- 
 science in the interpretation of the letter and spirit of the constitution, unem- 
 barrassed by any collateral considerations; and as such, I shall feel bound to 
 vote upon it. It is the province of the executive and judicial departments to 
 explain and direct the practical operation of each particular law; and I must 
 submit to the decisions. But the commentaries of courts are not to furnish 
 the principles upon which I am afterwards to legislate. It is to this book, (the 
 constitution) so justly dear to us all, and not to the books of reports, that we 
 must look, as a guide, to direct us in the path of our oath and our duty. 
 
 I believe, sir, that I have gone through, lamely 1 know, but I hope intelli- 
 gibly, with the examination of all the principal arguments that have been ad- 
 vanced in support of the constitutionality of this law. Having already occu- 
 pied so much" time, I will detain the committee but a few moments longer. 
 
 If the views which I have taken of the subject are correct, these positions 
 may be considered established. First, that we have no right to incorporate a 
 bank, unless that right be delegated by the constitution: for such is the decla- 
 ration of the constitution itsell. Secondly, that if this right be given by the 
 
ON THE BILL TO RENEW THE CHARTER OP 1791. 
 
 constitution, it is included in some of the provisions upon which I have been 
 commenting. 
 
 The only question, then, as relates to the constitution, is, whether we shall, 
 by the passage of this bill, recognise the doctrine of implied or constructive 
 powers. Before we do this, I must entreat every member of the committee 
 to examine well the consequences of such a recognition. This is not a ques- 
 tion about the utility or inutility of a bank; but it is a great question of con- 
 stitutional principle. It is, whether we shall consider this Government as the 
 servant and instrument of the people for managing and protecting their rights, 
 and subject, at all times, to their control; or, whether we shall make it a giant, 
 capable of crushing its masters? A moment's careful attention to this sub- 
 ject will show us that the doctrine of implied or constructive powers, as con- 
 tended for in this case, is nothing more nor less than the doctrine of general 
 expediency; and that, once established, it will warrant Congress in the adop- 
 tion of any measure not expressly prohibited by the constitution. 
 
 The great ends or purposes of our Government are, the liberty, the security, 
 and the happiness, of the people. The raising and management of revenue; 
 the establishment and support of armies; the institution of courts of justice; 
 and the regulation of trade and intercourse between the States and foreign na- 
 tions, are some of the great means or instruments by which these results are 
 finally produced. There is a natural and intimate connexion and coincidence 
 between all these great measures or powers of government; they are expressly 
 calculated to aid and assist each other in their operations, and, in fact, form 
 different parts only of one great political machine; every possible measure of 
 civil policy is expedient exactly in proportion to its fitness or tendency to 
 promote the combined operation of these great causes or instruments of human 
 happiness and security. But, sir, by the doctrine of implied powers, the con- 
 stitutionality of every measure is also made to depend on its tendency or fit- 
 ness to promote the final objects for which these various powers are given; 
 and thus resolves itself into a question of expediency. From the view we have 
 taken of the arguments in support of the right to incorporate this bank, we 
 perceive that its constitutionality is not made to depend on the peculiar appli- 
 cability of the measure to any particular power in the constitution: for it is 
 equally applicable to half a dozen different powers; but its constitutionality is 
 made to depend on its general tendency to promote the ultimate objects for 
 which these different powers were given. In other words, it is made to depend 
 on its expediency. We speak of implied powers as innocent things as mat- 
 ters of course. But the idea of express constitutional powers, and implied 
 constitutional powers, gives us the exact definitions of limited and arbitrary 
 Governments. The final object of both these Governments is the same the 
 happiness of the people. The only difference between them is, that in the one 
 case the powers or means by which this end is attained, or intended to be 
 attained, are limited and denned; in the other, they rest on the discretion or 
 will of the despot they are all, vvith him, questions of expediency. 
 
 There is another point of view in which, this subject may be placed; and 
 in which, it seems to me impossible for the strongest advocates of implied 
 powers to reconcile the passage of this bill. It will not be denied, that the 
 constitution contemplates the existence of two distinct sets of powers the one 
 in the State Governments, and the other in the Federal Government: that 
 there are certain powers which maybe said to belong peculiarly and exclusively 
 to the State Governments; and certain other powers which may be said to 
 belong peculiarly and exclusively to the Federal Goyerment. Now, sir, if 
 there be any power which ran be said to belong peculiarly and exclusively to 
 the State Governments, it is, in my humble apprehension, the very power of 
 erecting the corporations for the purpose of carrying on moneyed or other ope- 
 rations; connected immediately, necessarily and inseparably with the internal 
 political economy of the State: it is the power of regulating the rights and 
 relations of property between citizen and citizen of the same State: it is the 
 power of erecting a banking company, in order to facilitate and direct the daily 
 and ordinary operations of trade and industry among the citizens of the same 
 
180 BANK OF THE UNITED STATES. 
 
 State. Although, then, I say, the power of incorporating a bank might, at 
 first, seem to be implied in some of the powers of the Federal constitution? 
 yet, when we see that, in its exercise, it goes to obliterate and destroy the great 
 characteristic feature of distributive power in this Republic; when we see that r 
 in its execution, it obtrudes and ramifies itself into all the transactions of do- 
 mestic economy, which are the peculiar subjects of local or State regulation, 
 we ought, on that account, to reject it. 
 
 But, sir, I will conclude by again cautioning my republican friends, and 
 my worthy colleague in particular, to beware how they familiarise themselves 
 with (his doctrine of constructive power. It is a creed, at war with the vital 
 principles of political liberty. The pride and the boast of the American Go- 
 vernments is, that they are the governments of the laws and not of men that 
 they are the regular and necessary operations and results of principles and 
 powers, established in the moments of cool and deliberate reflection, by the 
 combined wisdom of the nation; and that they are not the effects of the mo- 
 mentary passion, pride, interest, whim or caprice, of a few individuals collected 
 on this floor. 
 
 Little did the framers of this constitution, when they were so nicely adjust- 
 ing and balancing its various provisions; when they were so carefully erecting 
 guards and barriers against the encroachments of power and ambition Little, 
 I say, sir, did they imagine, that there lay concealed under the provisions of 
 this constitution, a secret and sleeping power, which could, in a moment, 
 prostrate all their labors with the dust. Still less, sir, did the people when 
 they adopted this constitution, with even more caution and scruple than that 
 with which it was formed, conjecture that they were singing the death warrant 
 of all their State rights. But, once adopt the doctrine that you may travel out 
 of the letter of this constitution, and assume powers, merely on the ground 
 that they will tend to facilitate the execution of powers which are here given; 
 and you compass, at a single sweep, all the rights of the States; and form the 
 basis of a cansoliclated government. Let the principle of constructive or im- 
 plied powers be once established, in the extent to which it must be carried, in 
 order to pass this bill, and you will have planted in the bosom of this consti- 
 tution a viper, which, one day or other, will sting the liberties of this country 
 to the heart. 
 
 The question was then taken on striking out the first section, and carried, 59 
 to 46. Whereupon Mr. ALSTON reported the said amendment to the House. 
 
 JANUARY 19, 1811. 
 
 Mr. LOVE, this day, offered the following resolution: 
 
 Resolved, That it is expedient to repeal so much of an act passed the 10th 
 day of May, 1800, as makes it the duty of certain collectors to deposite, for 
 collection, in the bank of the United States or any of its branches, the bonds 
 taken by them for the payment of duties; and, that it be expedient to provide 
 that the bonds or money, now deposited in the said bank or its branches, may 
 be withdrawn. 
 
 The said resolution was read and ordered to lie on the table. 
 
 FEBRUARY 12, 1811. 
 The following proceedings took place: 
 
 Mr. LOVE moved that the House do proceed to consider the said resolution. 
 And, the question being taken thereon, it was determined in the negative. 
 [See Journals of the House of the above dates.] 
 
 The Committee of the Whole ? having reported to the House, that they had 
 agreed to strike out the first section of the bill. 
 
 Mr. FISK moved that the report of the said committee should lie on the 
 table. This was disagreed to by a vote of 57 to 46, 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 The House then proceeded to consider the report of the Committee of the 
 Whole. 
 
 Mr. DESHA spoke in favor of the report: Mr. PICKMAX, against it: Mr. W. 
 ALSTON, in favor of the report, but also in favor of a national bank, on the 
 ground of constitutionality; and Mr. KEY conlcuded the debate of this day, 
 in a speech against the report. 
 
 The several speeches are inserted in their order, as follows: 
 
 Mr. DESHA. Mr. Speaker: the question is on a concurrence with the Com- 
 mittee of the Whole, in striking out the first section of the bill that contem- 
 plates a renewal of the charter of the Bank of the United States; or, in other 
 words, whether we will foster a viper in the bosom of our country, that will 
 spread its deadly venom over the land, and finally affect the vitals of your 
 republican institutions; or, whether we will, as it is our duty, apply the pro- 
 per antidote, by a refusal to renew the charter, thereby checking the canker- 
 ing poison, the importation and dissemination of foreign influence that has 
 already brought our Government almost to the brink ot ruin. Sir, I am op- 
 posed to the renewal of the charter on constitutional grounds, as well as on 
 the score of expediency. I view it as being directly at war with not only the 
 letter, but the spirit of the constitution, and replete with principles incompati- 
 ble with republicanism. As to the constitutionality, the ground that I in- 
 tended to have occupied, was taken from me by the gentleman from New 
 York, who spoke yesterday, (Mr. PORTER) and I will say ably managed. The 
 points he made, 1 consider incontrovertible, and the arguments deduced from 
 them, unanswerable; consequently, as I deem the constitutional question 
 nearly exhausted, I shall but barely touch upon it. 
 
 The States, sir, from the time they determined to be free, were particularly 
 guarded against the adoption of any measure that could, in the most remote 
 degree, lead to aristocracy or consolidation. Let gentlemen examine that in- 
 strument the pledge of union; I mean the articles of confederation. They 
 will find it couched in cautious language; they will find that the framers of 
 that instrument, were particularly guarded against vesting powers in the Gen- 
 eral Government, that could, in the most distant manner, place their rights 
 and liberties in jeopardy; they, no doubt, viewed large moneyed institutions, 
 like the one under consideration, as moneyed aristocracies which might, with 
 their different ramifications, jeopardize liberty, by imperceptibly gliding into 
 consolidation. A power expressly given to the General Government to grant 
 charters of incorporation will not be found in the articles of confederation; 
 and if gentlemen will cast their eyes over the second article of that instru- 
 ment, they will find it expressly provides, that each State retains its sove- 
 reignty, freedom, and independence, and every power, jurisdiction, and right, 
 which is not, by the articles of confederation, expressly delegated to the United 
 States in Congress assembled. This, sir, I show to prove, that, from the time 
 the States determined to shake oft' the shackles of despotism, the power of 
 granting charters of incorporation was never intended to be given to the Gen- 
 eral Government. 
 
 Sir, those gentlemen who are the advocates of this measure will not pretend, 
 that the power to grant charters is expressly given by the constitution, and, 
 sir, they must be well apprised that such a power was never intended to be 
 given. This fact ought not to be lost sight of. Did not Mr. Madison urge, 
 in energetic language, in 1791, on the floor of Congress, that the power to 
 grant charters ot incorporation was in the original plan, reported by the com- 
 mittee to the convention among the enumerated powers delegated in the eighth 
 section of the first article of the constitution, but, that after three days' delib- 
 eration and ardent debate, it was expunged, as a power, dangerous and impro- 
 per to be vested in the General Government? It is on remote constructive 
 powers, that gentlemen must bottom this measure; and in my mind, there 
 they are cut short by the 10th article of the amendment to the constitution 
 of the United States,, where it expressly provides, that u the powers not 
 
182 BANK OF THE UNITED STATES. 
 
 delegated to the United States by the constitution, nor prohibited by it to the 
 States, are reserved to the States respectively, or to the People." Are not 
 those prohibitory words strongly and clearly expressed? Sir, I defy gentle- 
 men to lay their finger on any clause of the constitution that would justify 
 the granting monopolies or exclusive privileges. No, sir, it cannot be done, 
 unless they lay hold of the horrid doctrine of implication a doctrine as 
 absurd as it is dangerous, particularly when you have a specific instrument for 
 your guide, and one which you have taken a solemn obligation to support invi- 
 olate. 1 had hoped that the doctrine of implied powers, had long since been 
 exploded. Ever since the reign of terror; ever since the federal gentlemen, 
 under the head of constructive powers, adopted the alien and sedition laws, 
 the People of the United States, in whom the powers of Government right- 
 fully rest, signified their disapprobation of the doctrine of implication, in 
 forcible language, by hurling the then majority out of power. Sir, if you 
 subscribe to this doctrine, the barriers of your constitution are broken down; 
 it will ultimately become a dead letter; you will have nothing to restrain you. 
 But, say gentlemen, our predecessors have said it was constitutional; they 
 were men of wisdom and solemnly passed upon it as being within the pale of 
 the constitution. Sir, I acknowledge they were men of wisdom, and perhaps 
 actuated by the purest of motives: but they were men; consequently, fallible, 
 and liable to err; and in my mind, they did err most egregiously. And am I 
 to take for granted what they have done, without examining and judging for 
 myself, particularly when I am acting under the solemnity of an oath? No, 
 sir, while I have the honor of a seat on this floor, and any measure is about to 
 be adopted which, in my opinion, conflicts with that instrument that I am 
 sworn to support, I will raise my voice against it, and if possible, check its 
 progress. 
 
 But, sir, we are gravely told, that it is expedient to renew the charter of 
 the Bank of the United States, inasmuch as the evils arising to Government 
 and individuals would be desperate on its being suffered to expire; therefore, 
 it was constitutional. Then, sir, we are to understand expediency and con- 
 stitutionality to be synonymous terms; then, if that is the fact, the constitution 
 is a nullity in itself; Congress has nothing to restrain them but their judg- 
 ment. They are fully at liberty to adopt any measure they may think proper 
 under the sweeping clause of providing for the common defence and general 
 welfare. 
 
 Sir, much confidence as I have in Congress, after witnessing the fluctua- 
 tions and vibrations that have passed in review for several sessions past, I am 
 afraid your republican Government would be prostrated; your liberties would 
 be shortly at an end. Gentlemen talk of republicanism; -they say they are 
 real Americans in principle, and would go any length that was necessary in 
 defending our rights against oppression; and, sir, at the same time are doing 
 the very thing our lasting and inveterate enemy, Britain, would wish them 
 to do; and the very thing, if adopted, that will strengthen her power and 
 inevitably accelerate the dissolution of Government. What did that able 
 statesman say, who, with some gentlemen, have been considered almost ora- 
 cular? I mean, sir, William Pitt; speaking of the American policy--" let them 
 adopt their funding system and go into their banking institutions, and their 
 independence is a mere phantom." Sir, keep close to your chartered authori- 
 ties, or the most direful evils await you. If you are at liberty to twist that 
 instrument on which the perpetuity of your civil liberty depends, into any 
 shape the caprice of party may think proper, you may calculate on your boast- 
 ed institutions being of but short duration. If your constitution is defective, 
 amend it. The manner is pointed put, and which is certainly much safer 
 than to slide into the dangerous doctrine of implication. If you can multiply 
 and link together remote implications, you may, from the same parity of rea- 
 soning, take in every object of legislation that comes within the whole scope 
 of the political sphere. 
 
 Sir, it is not only astonishing, but painful, to behold gentlemen who, on for- 
 mer occasions, were loud against the doctrine of constructive powers, now its 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 warmest advocates. They come forward with the greatest ardor imaginable, 
 in support of a measure that has nothing in the constitution on which they^can 
 bottom it, without laying hold of the dangerous doctrine of implication. The 
 federal gentlemen have the same justification for the adoption of this measure, 
 that they had for the adoption of the alien and sedition laws. The doctrine 
 of implied powers will hold them out. But, sir, their object is to pull down 
 the administration and republicanism ours to support it. The minority is 
 not responsible; the majority has the whole responsibility on their shoulders; 
 consequently, ought to act with great circumspection. Sir, what were the 
 causes that produced a change of administration? Was it not constitutional 
 encroachments and abuses? Most unquestionably it was. And will gentle- 
 men wantonly steer their bark against the same rock on which the former 
 administration split? Rest assured, sir, that the People of the United States 
 will not tamely look on and see their sacred bill of rights trampled under 
 foot. No, sir; when they discover a disposition in the public agents to fritter 
 away their constitution into a mere cipher, they will rise in their majesty, and, 
 in a constitutional way, apply the proper corrective. They will tell you, 
 gentlemen, that you have betrayed the trust reposed in you, by abusing the 
 powers delegated to you ; that you must give place to more able and safer 
 hands to steer the national bark. 
 
 Well, sir, as to expediency, we are told that inevitable ruin would follow a 
 refusal to renew the charter of the Bank of the United ^States, as it is impro- 
 perly called. Pray, sir, in what way have the United States a single cent of 
 money or interest in this bank? Certainly none. Does she not merely lend 
 her name, and, by that, foster speculation? Most unquestionably she does. 
 For, sir, lean view it in no other light, than a complete system of speculation. 
 A system, sir, that has drained a considerable portion of your precious metals 
 from your country. Has there not, within less than twenty years, nearly 
 nineteen millions of dollars, dividends arising from this colossal bank, been 
 principally sent out of the country to fatten the European shareholders, who 
 are the principal stockholders? For, sir, I believe it will not be denied, that 
 about three-fourths of this ten million capital belongs to foreigners, and prin- 
 cipally to the citizens of the island of Britain; the balance, in all probabili- 
 ty, principally to her agents and partisans in this country: for I recollect 
 that, on a former occasion, a gentleman from Virginia laid a resolution on the 
 table for consideration, that contemplated making the shareholders known, 
 and that extraordinary opposition was manifested by the other side of the 
 House, I presume, lest the measure should become more unpopular, when 
 it was ascertained that nearly the whole of the capital stock belonged to 
 Britain and her partisans. 
 
 Mr. Speaker, money is naturally calculated to command influence. Then 
 what must be the influence wielded by this ten millions of capital in the bosom 
 of our country, and held principally by our lasting and inveterate enemy? 
 This is one of the engines, and no inconsiderable one, that is set to work, in 
 in order to overturn civil liberty, and which will, in all probability, unless 
 checked by timely resistance, go lengths in producing the effect: and, sir, 
 from the influence it has already obtained in different sections of the Union, 
 and the ardent manner it is advocated. I should not be surprised, if a renewal 
 of the charter should take place, if it should ultimately make its way into the 
 national councils. Let gentlemen reflect on the hardihood of the agents of 
 this bank. They come forward in the face of the nation, and openly offer to 
 bribe its councils with upwards of a million of dollars for the renewal of the 
 charter; for, sir, I may be wrong, but I can view it in no other light than as 
 a bribe in order to obtain the name and sanction of Government to carry on 
 their destructive speculations. I have no doubt but that George the 3d is a 
 principal stockholder in this bank; and I believe, rather than not succeed in 
 obtaining a renewal of the charter, that he would authorise his agent in this 
 country to bid up several millions; because, sir, he has never pardoned us 
 since our independence, and by this means he would necessarily calculate on 
 effectuating his nefarious purposes of overturning your Government and bring- 
 
184 BANK OF TIIE UNITED STATES. 
 
 ing you under his power again, and which would be a much safer method than 
 encountering the Americans in arms: for of that he became extremely tired 
 when we were in a state of infancy. 
 
 But, it is said, that this bank can be of infinite service to Government, in 
 making her deposites in, and, in case of necessity, to borrow money from, to 
 answer governmental purposes. Indeed, sir, if we continue temporising and 
 playing the losing game much longer, we will have but little to deposite and 
 would it not be as safe to make the deposites in some of the State banks as in 
 this foreign bank? For we must be in a desperate situation, indeed, if it would 
 not be equally as safe to trust ourselves as to trust foreigners, and the very 
 ones who are oppressing us, and whose interest as well as inclination is to 
 oppress us in every imaginable way. And, sir, as to the obtaining of loans in 
 case of emergency, I would much rather be dependent on my own Govern- 
 ment on the citizens of my own Government, than a foreign Government or 
 its agents, and especially one that is at war with us; for I deem it tantamount 
 to war, when they are perpetually plundering our property, impressing and 
 ill-treating our countrymen, as well as depriving us of important inherent 
 rights, the liberty of the seas. This measure, perhaps, may be a conveniency 
 in our fiscal concerns, in the collection and transmission of revenue; but, sir, 
 there is no danger of the wheels of Government being stopped for it; and, sir, I 
 should regret extremely, if it was, as has been insinuated, that the existence 
 of our Government depended on foreign capital; I should regret extremely 
 indeed, if we held our rights, privileges, and independence, on so uncertain a 
 tenure. No, sir, in my mind government can be carried on equally as well 
 without this darling bank as with it: therefore, it is time to abandon this de- 
 structive system. J confess, sir, that I am not very favorably disposed to 
 banking institutions; I view them as in direct hostility with the principles of 
 our Government: but if we must have banks, in the name of common sense, 
 let us have a bank of our own, with home capital and not foreign, and one that 
 will not import foreign influence, (for God knows we have enough of it among 
 us already) and one that will not extract the wealth from your country and 
 export it, nor undermine the foundation of your liberty. Well, sir, on whom 
 is this ruin, that is spoken of in such lively colors, to fall? Why, sir, it is to 
 fall on a few speculating merchants, who have been so incautious as to be- 
 come involved in debt in consequence of wishing to carry on extensive specu- 
 lations, therefore borrowed freely of this foreign bank, the calling for which 
 sums would, in all probabilty, bring on bankruptcies. These are riot the 
 people that I would make any considerable sacrifice for. They are not de- 
 serving it. Government has already made very considerable sacrifices in 
 attempting to comply with their memorials and petitions respecting the pro- 
 tection of commerce; and how have they been rewarded? Why, sir, by fly- 
 ing in the face of authority, and trying to bring the laws of Government into 
 ridicule. Yet they are the few who are to be favored at the expense of the 
 many. But, notwithstanding their reprehensible conduct, there are respect- 
 able exceptions: I speak of the speculator, not of the honest and fair trader. 
 
 I wish not to be considered an enemy to commerce. The reverse is the 
 fact. I am a friend to it to a certain extent; as an auxiliary to agriculture; 
 but I never wish to see it have the ascendency in Government, to sway the 
 national councils and give law. 
 
 But, sir, if the evils will be so great at this time on a failure to renew the 
 charter, what will they be at the end of twenty years, the time contemplated 
 to extend it? For it is reasonable to suppose, that the evil will increase in 
 equal ratio for twenty years to come, as it has for twenty years past. Agree- 
 ably to this, a renewal will be tantamount to a perpetuation; for, agreeably to 
 the doctrine held forth by gentlemen, a failure then to renew the charter 
 would engulph the Government in ruin, and overturn the fabric of liberty. 
 W 7 ho are to be favored particularly by the continuance of this destructive 
 system? The speculating mercantile class, I may say, exclusively. And, sir, 
 it they increase in extravagance and arrogance for twenty years to come, in 
 equal ratio with what they have for a few years past, nothing will satisfy them 
 
X)N THE BILL TO RENEW THE CHARTER OF 1791, 
 
 short of swaying the national councils, and giving law to Government, and 
 making every thing subserve to their cupidity. Sir, I hold commerce essen- 
 tially necessary, and would go as far as reason would justify in the protection 
 of it, but I am for keeping it directly within the pale of reason, and not sutter- 
 ing it to drown every thing in the whirlpool of its power. 
 
 Are not Government well aware, that this large foreign capital, in the bosom 
 of our country, has an . extraordinary influence in certain sections of the 
 Union in our elections, the keeping which pure, ought to be an object of the 
 first magnitude? How was it, sir, formerly, in New York? Did they not, in 
 consequence of this moneyed aristocracy, give complete tone to the elections; 
 and, sir, was it checked, until Burr surreptitiously obtained the Manhattan 
 Bank, under the mask of vyatering the city, which formed a counterbalance? 
 And, when it obtains an influence in your elections, you may necessarily 
 calculate on its making its way into your national councils; then every thing 
 must bend to this monstrous speculating institution, your constitution not ex- 
 cepted. 
 
 It will be said, no doubt, as I am from the West, where banks are not com- 
 mon, that I am unacquainted with the nature and operations of banking institu 
 dons. Sir, I do not pretend to go into details practically; I acknowledge, I am 
 unacquainted with them: my information on subjects of this kind is principally 
 theoretical. But, sir, I am sufficiently acquainted with the nature and opera- 
 tions of them, to convince me that they are systems of speculation, calculated 
 to suit the speculatory and mercantile class, at the expense of the agricultu- 
 rist.-.; at the expense of those who are the support and sheet anchor of your 
 Government? How is it, sir, when your banks break, which has been the case 
 in several instances, in some of the Eastern States? The Farmer's Exchange 
 Bank of Rhode Island^ when it was ripped up, had but some odds of forty 
 dollars in its vaults. Ihe Berkshire, ana Northampton banks, both of Mas- 
 sachusetts, when their vaults were examined, one had perhaps thirty or forty 
 dollars in it, the other, I believe, was entirely empty; the Coos Bank, (I be- 
 lieve it was called) of New Hampshire, was nearly in the same situation, and 
 thousands of their bills in circulation at the time. Well, sir, who were the 
 -uftl'rera? The note holders; the people at large? And, sir, as it is a system 
 of speculation, vyhon they ha\e emitted bills to the amount of their limitation, 
 where they are limited they may break (as the saying is) full handed, and the 
 Aveightofthe shock falls on the noteholders, who are principally agicrultu- 
 rists, as they compose eight- tenths of the people. 
 
 But, sir, the accounts of the speculations, impositions, and, I must add, 
 swindling and corruptions, that have been practised in the East, under the 
 head of banks, have reached the West, and the people, notwithstanding they 
 have, by some of/the eastern gentry, been deemed scarcely in a state of civil- 
 ization, have sympathised with their eastern friends, and had regretted that 
 turpitude had become so deeply rooted in the East, in the line of banking, 
 where all but exclusive civilization was claimed, and which has made them 
 cautiously guard against the possibility of being engulphed in a similar vortex. 
 But, sir, if gentlemen would cast their eyes emphatically over the history of 
 the West, 1 expectancy would not only find civilization, but pure patriotism; 
 patriotism, sir, that would not fade before the sun; they would find the people 
 uncontaminated with foreign partialities, prejudice or influence, and where 
 the last torch of liberty would be held up on the continent, as a terror to ty- 
 rants. 
 
 Mr. Speaker, perhaps I am mistaken, but I view this measure as the greatest 
 test ot political orinciple that has been on the carpet lor many years back, 
 and if adopted, federalism, or, if gentlemen please, aristocracy, will regularly 
 progress, and finally obtain the ascendancy; republicanism will have to take 
 the back ground, and ultimately be prostrated; your boasted institutions will 
 only figure m the pages of history, like ancient republics, as a mournful mon- 
 ument ot the iall of man, and a sorrowful memento of his degraded condition- 
 therefore, in my mind, the adoption of this measure would seem like com mi f- 
 tmg a most horrid treason against the principles of the cons " 
 24 
 
BANK OF THE UNITED STATES 
 
 liberty; consequently, I consider it not only the true interest, but the bounden 
 duty of every man who has any pretensions to friendship for the American 
 Government, or civil liberty, to assist in strangling this infant Hercules in the 
 cradle, or at least preventing it from coming to maturity. If this measure was 
 only calculated to perpetuate the memory of its founder, I should not so 
 much object to it; but then I should think it unnecessary and. improper. But, 
 sir, it will do more; it will further the views of federalism, by increasing their 
 power, and assist them in overturning the present system of government, on 
 the ruins of which they will calculate on raising one more congenial to their 
 purposes. 
 
 Mr. Speaker, from my present impressions, I think it would be more advi- 
 sable, if the British Government should not rescind their destructive measures 
 affecting our rights, and do us justice, rather than renew the charter of the 
 Bank ot the United States, as it is called, thereby furthering their views on this 
 country, to lay our hand on the capital stock, or at least so much as belongs to 
 citizens of the island of Britain, in order to indemnify us in part for the da- 
 mages we have sustained by British outrages, and, if it becomes necessary, (as- 
 l presume it will) to make use of it in defraying the expenses necessary in 
 the subjugation of the North American provinces, which will have to be re- 
 sorted to, if you wish to give peace to the land: for I have no hesitation in 
 saying, that, while this large foreign capital is in existence in your country r 
 and the British hold their North American possessions, that British principles 
 will be disseminated; that federalism if gentlemen like the term better, aris- 
 tocracy will regularly progress, and finally convulse your Government to its 
 centre. You may rest assured, sir, that if the charterof the Bank of the Unit- 
 ed States is renewed, it will prove a powerful weapon in the hands of our 
 enemies, and will be calculated to rule the Government, instead of the Govern- 
 ment ruling itself. Then, sir. is it not high time that the accounts of this co- 
 lossal speculating institution should be suffered to close, by letting the char- 
 ter expire on the 3d of March next, that we may know whether this Diana of 
 the Ephesians, be a goddess of solid silver, or only of clay silvered over. 
 
 Sir, much has been said about the want of capital; if gentlemen would cast 
 their eyes around, and examine our resources, they must be fully apprised 
 that we have capital adequate, and beyond our wants. Then is it not time to 
 cut asunder those leading strings, by which corruption has led credulity? Yes, 
 sir, it is not only time that we should have the name of freemen, but be so in 
 reality. 
 
 Sir, in justice to my own feelings, and the future prosperity of my country,. 
 I am bound to vote in favor of concurring with the Committee of the Whole in 
 striking out the first section of the bill. 
 
 Mr. PICKMAN. I acknowledge, sir, that I feel very anxious to have the char 
 ter of the United States Bank renewed. Not from any personal interests 
 which I have therein for I have none. Nor from a regard to the interest of 
 the stockholders, tor I consider that very unimportant, wnen compared with the 
 interests of the Government, and of the community. This question has ac- 
 quired an artificial importance from the manner in which it was originally 
 discussed and in which it has been discussed at this time. It has been treated 
 as a great constitutional question, when, according to my view, it involves no 
 great constitutional principles. Ingenuity has surrounded it with a mist of 
 sophistry which has obscured it, ami presented it to the mental eye though a 
 very delusive medium. I shall not attempt to follow the gentleman from N. 
 Y. (Mr. PORTER) in all his nice and ingenious distinctions between the pow- 
 ers vested in the Federal and State Governments, nor in his metaphysical re- 
 finements on objects, ends, powers and means; but shall leave that task to 
 gentlemen of more industry and more talent than myself. His observations, 
 however, on the position laid down by the late General Hamilton, in his cele- 
 brated argument on this subject, appear to me so extraordinary that I cannot 
 forbear to notice them. The position is, that every power vested in a govern- 
 ment is, in its nature, sovereign, and includes, by force of the term, a right to 
 
ON THE DILL TO RENEW THE CHARTER OF 1791. 
 
 employ; all the means requisite, and fairly applicable to the attainment of the 
 ends of such power, and which are not precluded by restrictions and excep- 
 tions specified in the constitution, or not immoral, or not contrary to^the es- 
 sential ends of political society. And to prove that the powers of the Federal 
 Government, as to its objects, are sovereign, the following clause in the con- 
 stitution is considered as dcsisive: " That the constitution, and the laws of 
 the United States made in pursuance of it, and all treaties made or which shall 
 be made under their authority, shall be the supreme law of the land." Now 
 the words supreme and sovereign are synonymous terms; if there be any dif- 
 ference, the word supreme is of the highest import, it being frequently applied 
 to the Almighty himself. But the gentleman from New York, (Mr. PORTER) 
 as I undertood him. observed, that the power to pass the supreme law does not 
 give the Government sovereign power: for the highest law which any govern- 
 ment can pass, is a law to inflict the punishment of death. The sheriff who 
 executes this law, said he, is not, therefore, possessed of sovereign power. 
 Certainly not; he is only the instrument of the sovereign power, as much so as 
 the axe or the halter with which he executes the sentence. But " the Govern- 
 ment is not sovereign because it is made to depend, in some degree, on the 
 State Legislatures" if they were to omit to appoint Senators the Government 
 would die a natural death. If they were to neglect it they would violate their 
 oath to support the constitution of the United States. But, " the sovereign 
 power is in the people." The sovereign and the physical power are often con- 
 founded together. The people, in their collective capacity, are as much bound 
 by the immutable rules of justice, as each one is in his individual capacity. 
 The people of the United Stales are under a constitutional and moral obliga- 
 tion to support the Federal Government: and it is not proper to presume tnat 
 they will omit to do what it is their duty to do, and found an argument on such 
 presumption. 
 
 But, to return to the subject of the bank. If we consider, sir, what are the 
 purposes for which it was established, and what are the privileges with which 
 it is invested, we sluill,. I think, find, that the former are not only constitu- 
 tional, but highly necessary, proper, and useful, and that the latter do not in- 
 terfere with State rights. The constitution of the United States vests Con- 
 gress with the power fcb to lay and collect taxes, duties," &c. ; to pay the debts 
 and to provide for the common defence and general welfare of the United 
 States; "to borrow money on the credit of the United States; to regulate 
 commerce with foreign nations, and among the several States; and to make 
 all laws which shall be necessary and proper for carrying into execution the 
 foregoing powers." It is, therefore, the right and duty of Congress to facili- 
 tate, and to render as certain as possible, the collection of the revenue. It is 
 their riff ht and ditty to provide places of safe deposite for the public moneys; it 
 is their duty to discharge the public engagements with punctuality and good 
 faith, and, if possible, to provide the means of transmitting the public moneys 
 from one place to another, as the public exigencies may require, without the 
 risk of loss to the United States. Has not the bank answered all these highly 
 important and necessary purposes? Can they be so well accomplished by any 
 other means ? I presume not; for the ingenuity of those who oppose the re- 
 newal of the charter and certainly, sir, they have displayed much ingenuity 
 has not suggested a plausible substitute. It is surmised that the public mo- 
 neys may be transmitted from one part to another, in specie, which may be 
 carried by land, or sent by water in Government vessels; or, that it may be 
 done by the private drafts of merchants. The objections to these modes are 
 too obvious to render it necessary to enumerate them. It is sufficient to say, 
 that each of them would subject the United States to frequent losses, and the 
 Government to constant disappointment. But, it is thought, by many, that 
 the fiscal concerns of the Government may be conducted through the instru- 
 mentality of the State banks; and, in fact, it is the interest of the State banks 
 which excites much of the opposition to the renewal of the charter of the Unit- 
 ed States Bank. In my opinion, however, it is an erroneous view of their 
 interest. I apprehend that many of them will sustain a shock from the sup- 
 
188 BANK OF THE UNITED STATES. 
 
 pression of this institution, from which they will never recover. How can 
 the public business now done by the United States Bank, be executed by the 
 State banks ? Congress have no control over them: are ignorant of their 
 funds;; unacquainted with the conditions on which tney are granted, and of 
 the principles by which they are governed. Some of mem are undoubtedly 
 entitled to confidence, but many of them are not. It would be imposing on 
 the Secretary of the Treasury an invidious task, and a most unpleasant re- 
 sponsibility, to make a selection. In every view which 1 can take of the 
 subject, it appears to me that it would be the height of imprudence and indis- 
 cretion to suppress the Bank of the United States, and deposite public moneys 
 in the State banks. If, however, the privileges conferred, and necessarily 
 conferred, on the United States Bank, are unconstitutional, then it is our 
 duty to suppress it. Let us candidly consider what these privileges are. The 
 greatest, in my opinion, is, that its bills are receivable for duties. I do not 
 know that any one has pretended that Congress transcended their powers in 
 conferring this privilege. It is this, however, and this only, which gives its 
 bills a circulation throughout, the United States; it is this which enables it to 
 transmit large sums from one extreme of the Union to the other, as the exi- 
 gencies of the Government require; nor do I see how this necessary privilege 
 could be conferred on the State banks. Certainly it would not be sate to give 
 it to all of them; and if you were to select a few, it would excite the most se- 
 rious discontents. Besides, it is necessary that the banks between which this 
 intercourse is to subsist, as that of drawing upon each other, should have a 
 common parent to regulate their affairs, and to secure them from ruin from 
 unexpected, and, of course, unprepared for, drafts. It is necessary, in fact, 
 that there should be such an institution as the United States Bank; and the 
 only question is, how shall it be established ? By the State Legislatures,. 
 or the Federal Government ? But, it is said that the establishment ot branches 
 in the different States, is a violation of the State sovereignties; and the gen- 
 tleman from New York, (Mr. PORTER) says it is so because the States have 
 laws against usury, and that the bank makes more thai> lawful interest upon 
 their capital, and thereby violates the laws of the States. This objection ap- 
 plies to all banks. Now, so far are the banks from having practised or en- 
 couraged usury, the suppression of it may be considered as one of the best ef- 
 fects of their establishment. The United States Bank is restrained by their 
 charter from letting their money at a rate exceeding six per cent.; and I be- 
 lieve that this is not usury in any of the States; in some of them the legal rate 
 of interest is higher. Their profits, over six per cent., are what they make 
 as bankers and not as money lenders. It is said to violate the State laws, 
 because the persons and private property of the stockholders are not responsi- 
 ble for the payment of its notes. This is the case with every artificial person; 
 he is not accountable, in his private capacity, for the notes which he gives, or 
 the contracts which he makes, as such. The stockholders of the bank may be 
 considered as public agents, and, as such, it would not be reasonable to sub- 
 ject their private fortunes to the payment of its debts, unless they abuse the 
 trust reposed in them. Such a responsibility would render it impossible to 
 establish the institution; nor is it necessary for the public security: for, it is 
 next to impossible for a bank with such funds to become insolvent, if its affairs 
 are honestly and judiciously managed; if they are otherwise, no guards will 
 afford security to the public. 
 
 It appears to be thought by many, that, because the State Governments 
 have a right to incorporate banks, therefore the United States' Government 
 has not the right. Now, it is an implied power in the State Governments; for 
 there is no such power expressly delegated to them in any of the State con- 
 stitutions; they assume the right, because it is not prohibited to them. Upon 
 the same principles has the United States' Government the right to establish 
 a bank, provided it be necessary to the accomplishment of the purposes lor 
 which the Government was instituted. I again inquire, Mr. Speaker, if the 
 fiscal operations of the Federal Government do not require such an institu- 
 tion? Has not the experience of twenty years fully evinced its utility to Go- 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 vernment? Have not the public moneys been safely kept ? Have not large 
 sums been continually transmitted from one place to another, as the public 
 exigencies have required, and without any loss to the United States ? Why 
 then suffer an institution, which has done so much good, which has proved so 
 safe and so useful, to run down, and trust to precarious and unpromising sub- 
 stitutes r But, while I am anxious to have the charter of this bank renewed, 
 from a lull conviction that the fiscal concerns of the Government cannot be 
 managed with convenience, or safety, in any other way, I feel infinitely more 
 anxious that it should not be suppressed at this time, on account of the commu- 
 nity at large. Such an event must, in my opinion, be productive of the most 
 distressing consequences. Perhaps there has never been a period when our 
 merchants were more embarrassed than they are at present, and when it was 
 more difficult to raise money. They have large funds in England, but at pre- 
 sent there is no demand for exchange upon that country. They have large 
 quantities of imported merchandise, out the prices of most articles are merely 
 nominal. The bank has seventeen millions of dollars due to it from the Unit- 
 ed States and individuals; it has to the amount of five millions of dollars in 
 gold and silver in its vaults: there is due to it, from the State banks, about 
 two millions of dollars, on their bills, and on deposites. It owes about four- 
 teen millions of dollars, payable on demand; and it will probably be very soon 
 called upon for this money. To fulfil its own engagements, therefore, it must. 
 immediately call for seven millions of iis debts, and, within a short period, 
 for the remainiKg ten millions;, and this last sum must, eventually, be paid in 
 specie. Whence is this specie to come ? From the vaults of the State banks, 
 if it be there: for the payments to the United States Bank will be in bills of 
 the State banks; these bills will be immediately sent to those banks to \; 
 changed for specie. Thus they, instead of having it in their power to aid the 
 debtors to the United States Bank, as some erroneously suppose, will be oblig- 
 ed to call on their own debtors, and every specie dollar taken from a bank, 
 may, and probably will, oblige it to call for two or three dollars of its debts. 
 It does not appear to me unreasonable to suppose, that, by compelling the 
 United States Bank to call in the seventeen millions of dollars due to it, we 
 shall compel the State banks to call in as large, if not a larger sum. {low 
 these payments are to be made, and what effects are to result from such a 
 state of things, I pretend not, sir, to sufficient discernment to foresee. It v/ill 
 probably produce a genera! suspension of the payment of debts, and an almost 
 total stagnation of business: it will greatly depreciate the value of every spe- 
 cies of property, and thereby reduce many persons to insolvency, who flatter 
 themselves that they have much more than enough to pay their debts. It will 
 raise an enormous demand for money, and, of course, throw many persons 
 into the hands of the griping usurer. It will distress all classes of people ex- 
 cept the moneyed capitalist If, in addition to this measure, our non-importa- 
 tion act should go into effect, thousands must be overwhelmed by ruin: the 
 shock may first be felt in the seaport towns, but will ultimately extend to the 
 remotest villages in the country. [ deem it, sir, a very unfortunate circum- 
 stance, that our paper circulating medium so greatly exceeds the amount of 
 our specie; that so large a portion of it is the representative, of lands, houses, 
 and merchandise, instead of being the representative of gold and silver. But 
 this is not the fault of the Federal Government; it is owing to the numerous 
 banks which have been instituted by the State Governments. This furnishes, 
 to my mind, a strong argument against the institution of banks by the States, 
 and in favor of the power being vested in the Federal Government, which su- 
 perintends the affairs of the United States. As i have before observed, our 
 paper circulating medium dangerously exceeds our specie; should we adopt a 
 measure which will affect its credit, it v/ill produce consequences which none 
 of us can foresee. On the one hand, by continuing the bank, we tread un;>ii 
 perfectly safe ground; twenty years experience of it has proved that it is c-i!- 
 culated to answer all the purposes for which it was established; it has proved 
 very useful to our merchants, and to the community at large, not only by fur- 
 nishmg loans, but. also, by supplying a medium which circulates throughout 
 
190 BANK OF THE UNITED STATES. 
 
 the United States, and thereby renders it much easier for the merchant of 
 the Northern States to purchase the productions of the Southern States. It 
 may be truly said, that it has aided the agriculture, the commerce, and the 
 manufactures of our country; its affairs have, generally, if not uniformly, been 
 conducted with fidelity and ability. Yet we are about to suffer this valuable 
 institution to fall; we shall thereby compel the Secretary of the Treasury to 
 have recourse to untried, troublesome, and hazardous expedients, for the 
 management of our finances, and we shall probably lead many of our fellow- 
 citizens into ruinous speculations. It is absurd, after the experience we have 
 had, to ascribe to it any great political influence: it was established by the 
 federal republicans when they were the ruling party; it has always been un- 
 der their management. Vet, with this monstrous engine in their hands this 
 engine which is to govern the Government their political opponents have 
 gained an absolute and uncontrolable ascendency. Continue it, sir, and you 
 will probably do much good; suppress it, and you may bring on incalculable 
 evils. 
 
 Mr. W. ALSTON said, that the motion to strike put the first section, was- 
 undoubtedly a fair way of attacking the principle of the bill; but as the same 
 motive, even if he did hereafter vote against the bill, would not govern him as 
 it had other gentlemen, he begged leave to state tne reasons why he should 
 vote against the motion. It has been contended (said he) by gentlemen who 
 have gone before me in this debate, that the constitution dkl not authorize 
 Congress to continue this charter, or to have created it, in the first instance. 
 I am opposed to this doctrine of the restriction of our powers, because I be- 
 lieve, if practised upon to the extent that gentlemen of great talents contend, 
 the Government itself cannot get along. I do not believe that gentlemen can 
 put their finger on the constitution, and show their authority for a number of 
 acts which we are compelled to pass, any more than they can put their finger 
 on the particular passage which authorizes the granting this charter. 
 
 Sir, we are met on the threshold of this question, tiy the gentleman from 
 Virginia, (Mr. BURWELL) on constitutional grounds; and I will take the ar- 
 gument of that gentleman alone, and I think can prove, that he himself has 
 given up the consitutional question. In the clause which many gentlemen 
 have called the sweeping clause in the constitution, I find these words: " Con- 
 gress shall have power to make all laws necessary and proper for carrying 
 into execution the foregoing powers, and all other powers vested by this con- 
 stitution in the Government of the United States, or in any department or 
 office thereof." The gentleman, well satisfied that this clause confers the 
 power, attaches to it, to make it the more important, the word " absolutely," 
 before he is able to give any weight to the construction for which he contends. 
 I have examined the constitution over and over again, for the word absolutely, 
 and can find no such word. Where then does the gentleman get it from, but 
 from the very same source that he charges on the favorers of the constitutional 
 right to pass the law? It is by implication, that he calls in the aid of the word 
 absolutely before necessary. With what propriety, then, can he refuse to 
 others the exercise of the same right that he himself has taken? If gentlemen 
 have the right to interpolate this word, why may we not as well interpolate 
 others? It is denied that the doctrine of implication can apply with respect to 
 granting charters. If it can apply in any way, why not in this way? If I can 
 show to the House that it might apply in some cases, or it will be impossible 
 that you can execute the object of the constitution, why may it not as well 
 apply in the case of granting charters, as in any other. I ask gentlemen to 
 put their finger on the clause of the constitution, which authorizes them to 
 pay away one cent of the public money? How do they get at the power, but 
 by implication? You have a power by the constitution, to pay the debts of the 
 United States but that part which provides for the payment of debts, means 
 debts already contracted, and owing at the time of the adoption of the consti- 
 tution; that too is in the sweeping clause, which gentlemen will certainly not 
 avail themselves of. But you have not the power expressly given, to create a 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 debt, other than the clause which authorizes you to borrow money on the credit 
 of the United States; but none will contend, that, by this you are authorized to 
 make contracts, and go in debt. There is an important clause of the consti- 
 tution, which gives to the United States power to call out the militia of the 
 States for particular purposes. Show me Jthe spot in the constitution which 
 authorizes the payment of the militia. Not one. The power to call them 
 out, implies the power to pay them. It inevitably follows, that the power to 
 lay and collect taxes and raise a revenue, implies the power to take care of it. 
 Will gentlemen pretend to deny it? What is the argument of gentlemen on 
 this point? They say it is true, that a bank is necessary for the safe keeping 
 and paying the debts of the United States; but, say they, the banks of all the 
 States are open to you. How does this doctrine apply to the United States? 
 Have not the States themselves denied the connexion of the State and Fede- 
 ral Governments? Can I quote a State which docs not afford an example of 
 this disposition? The seat of a gentleman of high standing in the Legislature of 
 Virginia, was vacated merely because he was a contractor for carrying the 
 mail. Will then the State of Virginia, who is so jealous of your influence 
 over her officers, permit you to exercise that influence, by placing your mo- 
 ney under officers created by her? Let gentlemen examine this question- 
 The argument will not bear them out. In the State which I represent, also, a 
 law has been passed, to prevent a person from holding any office or appoint- 
 ment at the same time, under the State and Federal Governments. What 
 right have the directors in a State bank, appointed by the State, to contract 
 with the General Government to keep its money? I deny their right. 
 
 Putting the State banks out of the question, it is necessary that we should 
 create means by which we can transfer the money of the Government without 
 expense, hazard, or loss? 1 will state a case. Wo have an army in the city 
 of New Orleans, which must be paid. By paying the money at Baltimore or 
 Philadelphia, it is transferred to the paymaster at New Orleans, without cost- 
 ing you a cent. Is not this convenient expedient necessary to comply with 
 the interest of the United States in the case I have suited? 1 do not believe 
 it possible, taking the ground that they have a right to place money in the 
 banks of the individual Static, that such a connexion between them could 
 i-viM- be established as with the same ease, convenience, and safety, as at pre- 
 sent, to pay in the different part 8 of the Union monry which the United States 
 are bound to pay. 1 ask the question Will a bank in North Carolina trust 
 a bank in New Hampshire: No: but the State and every individual in it, 
 would trust the Bank of the United States. You could not establish a con- 
 nexion between North Carolina and New Hampshire, so that either would 
 trust the other. The establishment of the Bank of the United States, affords 
 in this case, a facility useful and absolutely necessary, in my opinion, to carry 
 on the measures of Government. How will putting down the Bank of the 
 United States, have an effect to lessen the quantity of paper in circulation? 
 If I could think so ? I would join the gentleman most seriously; but the very 
 contrary, in iy opinion, would be the effect. The Bank of the United States 
 and its paper, serves as a controlling power, keeps the State banks in proper 
 bounds; and prevents them from issuing a vast quantity of paper, which would 
 inundate the country. They are very confident if they issue too much paper, 
 that there will be a run upon them; because the interest of the United States 
 Bank and the State banks, do not at all times go hand in hand. At this time 
 it certainly restrains the circulation of State bank paper. 
 
 It is said, sir, that the States are not compelled to do particular acts which 
 they are required to do. To be sure, the States have the physical power, but 
 they are bound by the same solemn oath to carry into effect the constitution 
 of the United States, that the members of this House are. It may as well be 
 said, that the State Legislatures may, if they choose, refuse to appoint electors 
 to vote for President and Vice-President, or elect Senators; but the obligation 
 upon them is as strong as upon any other department of the Government, as 
 it is upon the members of this House, to perform its duties. They have taken 
 a solemn oath, and must perform its obligations. 
 
192 BANK OF THE UNITED STATES. 
 
 Sir, there is one part of this constitution, which, in my humble opinion, 
 gives the power completely. It is a part of the constitution which 1 never 
 heard any gentleman mention, nor any writer on the subject. I may put an 
 erroneous construction on it; but if I am correct, the conclusion is inevitable. 
 In the 10th section of the first article, it is said, " No State shall coin money, 
 emit bills of credit, or make any tiling but gold and silver coin, a tender in 
 payment of debts;" and the interpretation which 1 give to it is, that the United 
 States possess the power to make any thing besides gold anil silver, a legal 
 tender. 
 
 If this, then, be the correct construction, it is a clause which I have never 
 before heard relied on. If, what I conceive to be the fair interpretation, be 
 admitted, it must follow, that they have a right to make bank paper a tender. 
 Much more, then, sir, have they the power ot causing it to be received by them- 
 selves in payment of taxes. If they have power to make paper of any descrip- 
 tion whatever, receivable in payment of all debts whatever, can any one deny 
 that they have a power to make it a tender in payment 01 taxes or debts to 
 the United States? After admitting the power, will you place the exercise 
 of it in your Secretary of the Treasury, or in the hands of fifteen or twenty 
 men whom you call directors? But I might not have voted against concur- 
 ring with the committee in striking out the first section of the bill, if I stood 
 on this ground alone. 
 
 To the bill in its present shape, I should have no hesitation in giving a de- 
 cided negative; but there is a plan on which I would vote for the renewal. 
 .Sir, I ask gentlemen who have voted against it on constitutional ground, to 
 meet me on this pointthe plan is, that the additional stock shall be taken 
 wholly by the United States; that they shall be bound to distribute it among 
 the individual States, having respect to their relative numbers, at its par 
 value. The States would take it if they think proper; if taken, there is an 
 end to the violation of State rights. In a plan of this kind, a distinction is 
 brought to the mind of every man, whether he will prefer the interest of the 
 great body of those people who are represented in the State Legislature, or 
 whether he will support the interest of a few who think proper to incorporate 
 themselves for the support of a bank. The true question is, whether the emo- 
 luments of the banking system should belong exclusively to a few, or collec- 
 tively to the whole United States. I therefore hope, the first section will not 
 be stricken out. In discussing the detail, such a plan would be more interest- 
 ing than any other can be to the States. The advantages of such a system 
 must be seen. The anxiety evinced for the renewal of this charter, and the 
 credit of the State banks altogether, in consequence of the money made by 
 the banking system, is then done away. The money arising from the profit 
 of the banks will belong to the States in their individual capacity, and the 
 taxes of every individual lessened in proportion to its share of the capital. 
 Let gentlemen bring the question home to them; let them examine how it 
 concerns their constituents, and put the question which of the two will in- 
 terest the great body of the people the most. 
 
 Putting down the charter of the United States Bank, will not put an end 
 to the banking system. Cast your eyes about you at what has taken place at 
 the last, sessionsof the State Legislatures? Has one of them adjourned without 
 establishing a bank? It is bank paper as much when issuing from State banks 
 as when from the Bank of the United States. There is no sort of difference. 
 If this question had not been attacked on constitutional ground; if it had oeen 
 left merely to expediency, I should not have troubled the House on the sub- 
 ject. I know too little of the concerns of a bank to think of making a speech 
 on the details alone. But 1 know how much interest moves us on this ques- 
 tion. When you place money in the State banks, you give a complete license 
 to the State banks to issue what they please. What was the loss of paper 
 money during our revolution? Did it not foil on those who had given cretlit? 
 And are we prepared to meet such a shock as that? Could we have stood it in 
 any other cause than that in which we were engaged? Here let me enter my 
 protest against the banking system altogether; but we have it. Is not the 
 consequence more dangerouswill not the loss ultimately be greater, to let 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. J 93 
 
 the State banks issue paper at will, than to control them by the Bank of the 
 United States? 
 
 If the doctrine which gentlemen advance, about putting the finger on that 
 part of the constitution which gives f>ower to carry on the Government itself, 
 be true, we may as well quit legislation altogether. You cannot go a single 
 step without calling in the aid of implication. When a means is necessary 
 and expedient; when the operations of Government cannot as well be carried 
 on in any other way as by it, then it is necessary, and, being necessary, is 
 constitutional. 
 
 Mr. KEY. Mr. Speaker: This House, in Committee of the Whole, having 
 struck out the first section of the bill in relation to the charter of the Bank ot 
 the United States, and thereby defeated the bill ; and this House being called 
 upon to concur with or reject the vote of the committee, a question ot the ut- 
 most magnitude and importance is presented to our consideration. Few sub- 
 jects more deeply affect the welfare and prosperity of our country, and none 
 deserves a more calm and temperate investigation. I shall not attempt to ex- 
 cite the feelings of the House by painting the scenes of distress that will proba- 
 bly flow from a non-renewal of the charter; but address myself entirely to 
 your understandings. 
 
 All parties seem'to concur in the utility and convenience of the bank to aid 
 the collection and payment of our taxes and revenue, to safe keep the amount, 
 and distribute it when wanted. But many deny that we have, under the con- 
 stitution, a right to incorporate a bank eVen for such purposes. I have listened 
 with pleasure to the arguments urged by those who deny the right, and have 
 weighed them with attention, and soliciting the same indulgence from them in 
 return, I do not despair of producing conviction, 
 
 I shall contend, that we have a right to create a national bank, and that it 
 is our duty to do so, to avoid the general calamity that will result to the 
 country, if we fail to do it. I beg of gentlemen to take the constitution in 
 their hands, and follow me, step by step, while I demonstrate the existence of 
 the right. 
 
 The eighth section of the first article of the constitution, contains the grant 
 of powers given to Congress, to enable it to conduct the affairs of the Union. 
 The powers given are enumerated and specified, being eighteen in number. 
 In the first we find these words: 4 ' The Congress shall have power to lay and 
 collect taxes, duties, imposts and excises, to pay the debts and provide for the 
 common defence and general welfare of the United States; but all duties, im- 
 posts and excises, shall be uniform throughout the United States." These 
 words give to the United States, a definite, explicit power, "to lay and collect 
 taxes, duties, imposts,*' &c. the only qualification of the power is, that the 
 duties and imposts, not the taxes, shall be uniform. The eighteenth enume- 
 rabed power is, 4k for Congress to make all laws which shall be necessary and 
 proper for carrying into execution the foregoing powers," &c. 
 
 The powers thus given to Congress are sovereign in their nature, and ex- 
 plicit in their terms of grant; but the jealousy and provident wisdom of the 
 framers of the constitution, knowing that the power might be abused in its 
 exercise, have, in the ninth section of the first article, enumerated seven spe- 
 cific limitations or restrictions of the powers previously given. The grant of 
 power is in affirmative terms; the restrictions are in negative terms. 
 
 The general grant of power, " to lay and collect taxes and imposts," &c. 
 given in the eighth section, is thus restricted in the ninth: "No capitation or 
 other direct tax, shall be laid, unless in proportion to the census," &c. 
 Secondly, "No tax or duty shall be laid on articles exported from any State." 
 It is a sound rule of construction, and is founded in common sense as well as 
 wisdom, that, where a grant creates a general power, and enumerates excep- 
 tions to its exercise, the expression and enumeration of those exceptions, 
 operate to exclude all others; because, having exceptions in view, and having 
 specified some, it demonstrates that if others had been intended, they would 
 also have been expressed. This rule is so true, that it has long been a maxim, 
 5 
 
194 BANK OF THE UNITED STATES. 
 
 that, 4 * Expressio unuis est exclusio alterius^ and governs the construction 
 of all grants and instalments in public or in private lite. I am then warranted 
 in saying, that the grant of power "to lay and collect taxes and imposts, &c. 
 provided the latter are uniform," is fettered or restricted by no other limita- 
 tion than the two above expressed in the ninth section; and it follows, that we 
 can make any laws necessary and proper to lay taxes, if we do not violate the 
 restrictions interdicting us from laying a tax on exports, and a capitation tax 
 contrary to the proportion of the census. 
 
 Mr. Speaker, an honorable gentleman from Virginia, on the constitutional 
 question, limits the power of Congress, by what 1 call an interpolation in the 
 constitution. The words of that instrument expressly give Congress the 
 power "to lay and collect taxes,"' and "to make all laws necessary and pro- 
 per to carry those powers into effect;" but the honorable gentleman adds, that 
 " necessary," means indispensably necessary. To this, I answer, that the 
 word indispensable is not used in the constitution; the words used are, ne- 
 cessary and proper. The error into which that gentleman and an honorable 
 member from New York have fallen, is a want of precise meaning of the terms 
 they use, or rather confounding two things, in their nature essentially differ- 
 ent. They confound the means or mode by which an end i& attained, with 
 the end itself, and nothing can be more erroneous. The end, or power given, 
 is to lay and collect taxes and pay the public debts; the power to make laws 
 necessary and proper to effect that end, is also given, and consists in devising 
 and establishing the means of accomplishing it. The means to accomplish the 
 end are no where restricted. All the restrictions are upon the power. The 
 means or mode by which the collection is to be effected, is left to the wisdom 
 
 debt," that it necessarily results that the party to do the act, may do it by any 
 mode or means he pleases, (if more means than one exist) if such mode or 
 means are not prohibited; and I further state, that the party in executing the 
 power, is imperatively bound to use the means best adapted to accomplish the 
 end. 
 
 sary 
 
 is definitely within the power of Congress. And more; it is the bounden'duty 
 of Congress to establish it; because they are bound to adopt the best practica- 
 ble, or, in other words> necessary and proper means to collect the tax and 
 imposts. 
 
 If more means than one exist to carry a power into effect, neither can be 
 said to be indispensably necessary, because either may be adopted to the ex- 
 clusion of the other; and this mode of reasoning, pushed far, proves, that, 
 where more means than one exist to execute a power, the power is a dead 
 
 That the creation of a bank, is a means to excite a given power, and not the 
 power itself, will follow from a careful view of the subject. Here my oppo- 
 nents and myself are precisely at issue. They say the creation of the bank 
 is a power not given by the constitution. I state it to be a means of executing 
 a power given, and not the power itself. Let spund reasoning test our prin- 
 ciples: what is a power, but an authority to attain a given end? What is the 
 power given in this case? Let the constitution speak for itself: " to lay and 
 collect taxes, imposts," &c. and pay the public debts. Now, the power and 
 the end are express, definite, and precise: there is but one power and one end; 
 human ingenuity can make no more out of the words of the constitution; but 
 there are many means by which the power may be executed, by which the end 
 may be attained, and those means are vested in Congress, by the power ex- 
 pressly given them "to make all laws necessary and proper to execute the 
 powers before enumerated." 
 
 Congress is a body politic and incorporeal, and must use some agency or 
 means "to carry a power into effect. To do it in this instance by the agency 
 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 bank, is one means; to do it by the appointment of officers to collect the 
 taxes, is another; to make the debtors themselves pay into the treasury, is a 
 third. Now is it not an equal exercise of power, to create and appoint officers 
 to collect, preserve and pay away public money, as to create a bank for that 
 purpose? The power is the saine, though exercised in a different way; but the 
 mode of its exercise does not affect the nature or essence of the power. This is 
 most clear; and I ask gentlemen, in the sense they use the word power, where 
 is the express power in the constitution, to appoint and pay officers to collect 
 taxes? Certainly it grows out of the power 4 ' to make all laws necessary and 
 proper," &c. and is no where else to be found; then the necessary conse- 
 quence is, that the creation of a bank, or the creation of officers, to collect 
 taxes and imposts, &c. is not a constitutional question, but of sound discretion, 
 as most suitable to promote the public good, and the House has power to adopt 
 either, as in their judgment shall be found most necessary and proper. 
 
 Now, for the great objects of economy in collection, safety in keeping, and 
 facility of paying it away^ as, and where the exigencies of Government require, 
 a bank has a decided preference over the appointment of a multitude of offi- 
 cers, with salaries or commissions, the chance of negligence, the risk of 
 loss, and almost insuperable difficulty and embarrassment of transmission, 
 at home or abroad, 
 
 I trust, Mr. Speaker, that I have shown, that, correctly viewed, the crea- 
 tion of a bank is a means, not an original power; that, as a means, it is best 
 adapted to the end or execution of the power; and that, to attain the end, a 
 full, express, definite grant of power is given by the constitution. But, sir, I 
 ask, is our Government never to settle down to stability, an object so desira- 
 ble and so important to the happiness of the People? If, from the inexplicit- 
 ness or imperfection of language, doubts have existed, which have been de- 
 cided by the concurrence of this House, the Senate, and the illustrious Wash- 
 ington, in the exercise of their constitutional function-, and twenty years last 
 past have exhibited a practical commentary on the constitution, ought we not 
 now to regard it as sacred? 
 
 Has not Congress, and have not all the States, sanctioned the legitimacy of 
 the bank, by passing penal laws against counterfeiters of its paper? Have not 
 many of the judiciaries inflicted imprisonment and deprivation of liberty, on 
 offenders under those laws; and are we now to be told, that the original law 
 which induced all these punishments, is unconstitutional, and of course, no 
 law? But, sir, I will not repose my argument on the fact of long acquies- 
 cence in the States, nor of acquiescence under the administrations of Wash- 
 ington, Adams, Jefferson and Madison; 1 will advance a step further, and 
 show that this House, under the ad ministration of Mr. Jefferson, and that Mr. 
 Jefferson himself, did, under his own hand, -acknowledge the legitimacy, and 
 consequently the constitutionality, of the bank. In 1804, Mr. Nicholson, of 
 Maryland, made a report, authorizing the Bank of the United States to estab- 
 lish an office of discount and deposite at New Orleans; a bill was drawn, it 
 passed this House, it passed the Senate, and was signed by President Jeffer- 
 son the day it was presented to him. It was entitled, " An act supplementa- 
 ry tootle act, entitled An act to incorporate the subscribers to the Bank of 
 the United States." Here let us pause; it is really ludicrous, sir, to see the 
 gravity and wisdom of the nation, engaged in passing a supplement to an un- 
 constitutional law. One would suppose, sir, that if the original law was 
 brought into view, if deemed unconstitutional, the object of bringing it into 
 view would be to repeal it; but what was the fact? Why, the very reverse 
 took place; instead of repealing it, they enlarged the powers of the bank. 
 
 Now, sir, I call on honorable men to answer me with precision; to meet two 
 questions in the teeth: First, Was it not as unconstitutional to enlarge the 
 powers of the bank, as originally to create it? Second, Is not the enlargement 
 so for as it goes, a new creation of power? Gentlemen cannot escape from 
 these questions, by saying, that the bank had this power before the act of 1804 
 I deny it; but for the sake of argument, be it so? Then I ask, why was that 
 supplement passed? And was not the passage of the supplement a direct af- 
 
 
196 BANK OF THE UNITED STATES. 
 
 firmative recognition of the power, if already in the bank, and to give it to 
 them, if they had it not. 
 
 Sir, I will trouble the House no longer on this part of the subject. I trust I 
 have satisfied gentlemen that we have authority to create a bank under the 
 constitution; that this authority has been acted on by federal and republi- 
 can administrations; and the united States and the States have acquiesced 
 in it, and sanctioned it many years, without murmur or remonstrance. 
 
 Mr. KEY then proceeded to examine the question on the ground of ex- 
 pediency, &c.* 
 
 JANUARY 21, 1811. 
 
 Mr. NEWTON moved to postpone indefinitely, the further consideration of 
 the bill, but withdrew his motion until more members should come in. 
 
 Mr. GARLAND said, that on this very important subject, the House ought 
 to act uriderstaridingly and prudently. He wished that they should not pre- 
 cipitate the Government into difficulties, from which it would not be easy to 
 extricate themselves. He wished at least, that they should take a little time 
 to reflect: that his friend from Virginia (Mr. Love) should be permitted to 
 go on, and take out his letters of administration, as proposed on Saturday,, 
 and see what could be done. If the gentleman could show that the Govern- 
 ment could conveniently carry on its fiscal operations without the bank, Mr. 
 G. said he should be ready to go with IXm. But, until that were shown, he 
 did not wish a decision precipitated. He, therefore, moved to postpone the 
 further consideration of the bill till the first of February. There would in the 
 interim, be time to see how they could form their plans, and how they would 
 be able to conduct the fiscal operations of the Government. If a suitable 
 substitute could be offered for the purposes of collecting and transferring 
 revenue, it would be the means of reconciling many gentlemen to vote against 
 the bank. He hoped, therefore, that the postponement would be agreed to. 
 
 Mr. NEWTON said the House had had ample time for reflection on the sub- 
 ject. He did not believe that any alteration would be wrought in the opinions 
 of members by a postponement. 
 
 Gentlemen ought to recollect that the subject had been under consideration 
 for three or four years past. Every one had revolved it in his mind. Sir, 
 gaid Mr. N., I know these moneyed institutions. I know what sort of things 
 they are; and after the time we have had to consider the subject, I think it 
 all important, that we should come to a decisive determination. Let me tell 
 you, sir, that intrigue and artifice will wear away the best principles. Ample 
 time has been given for it already. 
 
 I am for laying the legislative axe at the root of the evil: I am for imme- 
 diately deciding this question, and turning to some other business, and for this 
 purpose, move that the further consideration of the bill be indefinitely post- 
 poned. 
 
 The motion of Mr. NEWTON superseded that of Mr. GARLAND. 
 
 Mr. LOVE said he rose principally, at this time, to ask for the yeas and 
 nays on this question- He thought with the gentleman last up, that it was 
 highly important that there should be an immediate decision, and he would 
 add to the reasons already offered in favor of it another- It is now three 
 years, said he, since Congress were called upon, in the most imperative terms, 
 to act upon this subject. In the petition of the stockholders, three years ago, 
 it will be recollected, that it was stated that, unless a certain assurance was 
 given, that the charter would be renewed, they must immediately comnience a 
 curtailment of their discounts, &c. We have now progressed to within six 
 weeks of the time when this institution will cease to exist; and, yet, we find, 
 by an inspection of their accounts, that they stand very nearly in the situa- 
 tion in which they were at the time the subject was first brought before Con- 
 
 * The remainder of Mr. KKT'S speech does not appear to have been published. 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 gress. If this company were not to have their charter renewed, the sooner 
 they know it the better. On the part of the Government, it is important that 
 an early decision should be had, that they may not run the risk of losing 
 revenue to an immense amount; for, who knew who was to administer on the 
 assets of this institution? In consequence of the law now in existence, re- 
 quiring deposites to be made in the Bank of the United States, and its branches, 
 there would soon be within their control, in specie and bonds, an amount 
 of sixteen millions of dollars of the public property. Under present circum- 
 stances, it is highly proper that immediate measures should be taken to with- 
 draw these deposites. Every gentleman, before this time, must have had an 
 opportunity to make up his mind; and I hope the question will be decided 
 without further delay. As the mind of no gentleman in the House could be 
 changed by a discussion, it is to be hoped that the question will immediately 
 be taken. 
 
 Mr. TROUP conceived the motion now made to be perfectly proper. He 
 felt, however, under no obligation to accommodate the bank. The act grant- 
 ing an act of incorporation was entirely a voluntary act, and the duration of 
 it limited in the act itself, to a term of twenty years. If the bank had acted 
 the part of an ordinary or discreet merchant, it would have taken care, before 
 the expiration of its charter, to have wound up its business, and be prepared 
 to meet the event; because, the Legislature was not bound to renew it, not 
 having, either by the original charter, or by any subsequent act, given any 
 pledge, that it would do so. The bank not having received any pledge of re- 
 newal, ought to have been prepared for its dissolution. If the institution had 
 done what they ought to have done, the Government, so far as it is concerned, 
 would have prepared itself against the event, as he was told it was now about 
 to do, by substituting arrangements with the State banks, for arrangements 
 with the United States Bank, or its branches. Mr. T. could, therefore, see 
 no difficulty in assenting to this proposition, whether as respected the Go- 
 vernment, or as respected the individuals concerned in the bank. 
 
 Mr. FISK inquired whether it was understood that the deposites in the United 
 States Bank would be transferred to the State banks without the sanction of 
 law. 
 
 Mr. WRIGHT spoke at length on the principles of the bill, and in favor of 
 indefinite postponement. 
 
 Mr. BOYD spoke in favor of the motion. 
 
 Mr. McKEE followed in reply, and against the poposed postponement. 
 
 Mr. BARRY spoke at length on the constitutional question, and in favor of 
 indefinite postponement. 
 
 Mr. FINDLEY spoke against the motion. 
 
 Mr. WRIGHT. Mr. Speaker: The importance of this subject, and the great 
 attentionUhat has been paid to gentlemen while delivering their opinions upon 
 it, is a sure guarantee that I, also, in my turn, shall receive the attention of 
 this House, while I deliver my sentiments. 1 pledge myself, in this exhaust- 
 ed state of the debate, not to consume more of their time than a correct sense 
 of duty to my constituents shall impose. 
 
 This subject, sir, is presented to our consideration in a two-fold point of 
 view: as to its constitutionality, and as to its expediency. I will, therefore, 
 proceed to consider it in that order. 
 
 On the point of its constitutionality I shall take the liberty to recal your at- 
 tention to those parts of the constitution on which its advocates have seem- 
 ed to rely. The gentleman from Maryland (Mr. KEY) cites the 1st article, 
 8th section, " Congress have a right to lay and collect taxes, imposts, du~ 
 ties, and excises, to pay the debts, and provide for the general defence and 
 
198 BANK OF THE UNITED STATES. 
 
 common welfare of the United States." He also read the 1st art. 9th section, 
 ** No capitation, or other direct tax shall be laid, unless in proportion to the 
 census or enumeration herein before directed to be taken." However, not 
 yet himself satisfied with being able to derive an authority from these sections, 
 he calls in aid the last paragraph of the section, " Congress shall have power 
 to make all laws necessary and proper for carrying into execution the fore- 
 going powers, and all other powers vested by this constitution in the Govern- 
 ment of the United States, or in any department or officer thereof." The 
 gentleman insists, that the power to lay and collect taxes, &c. &c. and the 
 sweeping clause empo\yering Congress to make all laws necessary to carry 
 that power into execution, will authorize Congress to grant a charter to this 
 bank; that it is necessary to the collection of taxes, that Congress provide by 
 law the means whereby the taxes should be paid. I had always presumed 
 that the power to lay and collect taxes, to provide for the general defence and 
 common welfare, only authorized Congress, under the limitations of Ihe con- 
 stitution, to provide by law for those purposes, by directing whether the tax 
 should be a direct or an indirect tax, or by capitation; and that their powers 
 extended no further than the specification of the objects, if the tax was di- 
 rect, and the rate at which the specific articles should be valued in the case 
 of a capitation, what should be paid by the head; and, in the case of indirect 
 taxes, what should be the duty on the several articles taxed; and, in either 
 case, to direct the mode of ascertaining and collecting the same; by whom to be 
 ascertained, and by whom collected, and to whom paid. But 1 never did 
 suppose that this power, even aided by the sweeping clause, could be conceiv- 
 ed, seriously, to extend to the providing means to those who had to pay the 
 tax, whereby they were to be aided in the payment. Such a construction 
 would as well justify the passing a law, compelling the culture of land in a 
 particular way, whereby the crops might be increased; as the farmer cannot 
 pay his tax, unless he raises produce for sale; or, indeed, it might be extend- 
 ed to compel him to use plaister of Paris to improve his crop, and facilitate 
 the payment; which I should deny, even if the tax was made payable in pro- 
 duce. 
 
 The same gentleman seems to have relied on the article, " That no capita- 
 tion, or other direct tax should be laid, but in proportion to the census," as 
 forming an exception to the powers of Congress; and, I presume, means to 
 infer, as this bill will not be a capitation tax, that Congress may pass it under 
 their power " to lay and collect taxes," and the sweeping clause to carry their 
 specific powers into execution. Sir, the convention never intended that Con- 
 gress should have, or exercise, the power to establish banks, or they would 
 nave made use of apt words to have vested them with it. Bank, sir, is 
 a technical term; and if they had j intended that power, they would cer- 
 tainly have used that term. When it was intended to give any power, we 
 find the convention had no difficulty in expressing it: as, Congress shall 
 have power " to coin money and regulate the value thereof, and of foreign 
 coin. " And here, let me remark, is an express power " to coin money," 
 which, if we were left to legal construction, would be an affirmative pregnant 
 that they should not omit bills of credit. But, sir, we need not rely on con- 
 struction to prove what powers Congress have not, as one of the amendments 
 to the constitution provides, that " Congress shall have no power that is not 
 expressly given." And, to give a power by expression, is to use apt words 
 for that purpose, and it of course becomes necessary to the power in Congress 
 to establish a bank, that such a power should be given by such specific terms, 
 as would, unequivocally, and without construction, convey the right. 
 
 As to the sweeping clause, " to pass all laws necessary to cany into effect 
 the foregoing powers of Congress," the letter of this section confines its opera- 
 tion to the specific powers of Congress, previously enumerated, and can, in 
 no sort, create constructive powers, or be construed into a creation or exten- 
 sion of power. Sir, if a doubt can remain of its harmless and inoperative na- 
 ture, I trust it will be removed by a reference to the second volume of the 
 / Federalist, page 202: " It is expressly to execute these powers, that the 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 sweeping clause, as it has been affectedly called, authorizes the National Le- 
 gislature to pass all necessary and proper Jaws. If there be any thing excep- 
 
 one of the framers of this instrument, when defending this article called the 
 *' sweeping clause," from the charge of being used to extend the powers of 
 Congress, or to embrace other than the specific powers, himself confining it to 
 the express powers, and, indeed, declaring that it ave no power,' was a mere 
 tautology. Yet gentlemen seem to think that it is an important delegation 
 of power, and confidently quote it as such; and, indeed, if their construction 
 of it was indulged, it would discharge us from every constitutional obligation, 
 that ice, in our discretion, might suppose the public good required; but I trust 
 the good sense and patriotism of this House will never suffer it to substitute. 
 discretion for expression* their will for the law. 
 
 An honorable member from North Carolina, [Mr. ALSTON] has, with some 
 confidence, cited the 10th section of the 1st article: "No State shall emit bills 
 of credit, or make any thing but gold and silver a tender/' He urged this 
 denial of the right to the States to emit bills of credit, as a perfect prohibition 
 of the States to grant bank charters, and insisted that bank notes were bills of 
 credit. He spoke of this section as a discovery of his own, riot noticed by 
 any body before him, as applicable to the case. Sir, the gentleman certainly 
 misapplies the term * bills of credit" to " bank notes." The term 4> bills of 
 credit," was surely intended to express and prohibit the emission of paper 
 money, which had been emitted by the States and by Congress, during the 
 war of the Revolution, and had Bo depreciated, as to impress the convention 
 with the propriety of prohibiting their emission in future. By a recurrence to 
 the proceedings of the old Congress, and the laws of the several States, it will 
 be found that the term " bills of credit," was technically used for paper money; 
 nor can there be less doubt that bank notes have also their technical meaning, 
 as the paper issued by bank directors; and neither of the terms " bills of cre- 
 dit," or 4 * bank notes," could, by men of legal intelligence, be used for the 
 other. i4 Bank note," and a " bill of credit," are terms so well known to the 
 law, that, in legal parlance, neither could be substituted for the other. On a 
 prosecution for counterfeiting either, the other could not, I apprehend, be 
 given in evidence. I must, therefore, insist, that the gentleman's construc- 
 tion of the constitution is incorrect. But, sir, if it was correct, and the States 
 could not grant bank charters, would it follow that the Government of the 
 United States would possess the right? I presume not: unless that article of 
 the constitution, which declares, " that all powers not granted to Congress 
 are reserved to the States, or the People, shall be blotted out of the instru- 
 ment, or totally disregarded. Sir, I hope we have not already arrived to that 
 lust of power: and I trust the present case, when its expediency comes to be 
 examined } will not seduce any member of this House from his regard to this 
 hallowed instrument. 
 
 Sir, the Secretary of the Treasury, [A. Hamilton] at the time of the pas- 
 sage of the law establishing the United States Bank, and who may be called 
 the father of it, labored with unceasing assiduity, in every stage of it, to give 
 it a legitimate existence. We see him, sir, insisting on the power to grant 
 this charter, as conferred by the section that authorizes Congress to lay and 
 collect taxes, and by the svyeepin^ clause, " to pass all laws necessary to 
 carry the preceding powers into effect," any thing, in his opinion, in the Fe- 
 deralist, before cited, as to the harmless quality of the sweeping clause, to the 
 contrary notwithstanding. Sir, we see him driven from these stands by the 
 Attorney General, [Mr. Randolph] and by the then Secretary of State, 
 [Mr, Jefferson] the last of whom insisted, that a proposition in the conven- 
 tion, to authorize Congress to grant corporations, had been rejected; which 
 so thoroughly closed the case, that we find Mr. Hamilton, although he ques- 
 tioned the authenticity of the document relative to the rejection (by the con- 
 vention) of the articles alleged to have been rejected, taking post behind that 
 
200 BANK OF THE UNITED STATES. 
 
 article of the constitution, that " Congress shall have power to dispose of, and 
 make all needful rules and regulations respecting the territory, or other pro- 
 perty, belonging to the United States," and insisting, that the shares ot the 
 stock contemplated to be subscribed by the United States, would bring the 
 law, granting the charter, within that section which authorized the United 
 States to make all needful rules and regulations respecting the property of 
 the United States. But this would not justify a renewal, as Congress have 
 sold their stock. Thus, sir, we find the advocates of this power in Con- 
 gress to grant a charter to the Bank of the United States, fixing on a va- 
 riety of the sections of the constitution, from whence they infer we have the 
 right. And, although, by the express letter of an amendment to the constitu- 
 tion, Congress can exercise no power not expressly or specifically granted, 
 yet these gentlemen insist we have the right, although they cannot agree 
 among themselves on the article by which it is specified; and, indeed, each is 
 an authority against the other, that the power is not granted at all. And al- 
 though they all agree on its being constitutional, they areas much at a loss to 
 fix oh the article by which it is made so, as the ladies of Strasburg were to 
 decide on the composition of Stern's celebrated nose, though they ail agreed 
 it was a noble nose. 
 
 The gentleman from Maryland says, Congress have, by the law authorizing 
 a branch of this bank to be established at New Orleans, recognised their right 
 to grant a charter; and insists that this ought to be considered as an authority 
 to that purpose. 'Strange that the gentleman's zeal should so transcend his 
 judgment as to induce him to press so futile an argument. Congress, at the 
 time of passing that law, had a right to make any law necessary for, and be- 
 neficial to New Orleans; it was men a territory, and, by the positive provi- 
 sions of the constitution, Congress have the power to make all *' needful rules 
 and regulations respecting their territories or other property;" they have ex- 
 clusive legislation over it, and may make any law that a State could, as to its 
 government, as well as any law authorized by the constitution to be passed by 
 Congress. 
 
 Sir, by this charter, the directors of this bank were authorized to fix 
 branches in every part of the United States; and when Congress became the 
 purchasers of New Orleans, they considered it a portion of the United States, 
 and, of course, that the directors of this bank had the right to establish the 
 New Orleans branch bank, and felt no hesitation to declare it by law, as they 
 had a perfect constitutional right to make all needful laws for their territories, 
 of which the Orleans territory then was, and yet is one. Yet, sir, this act of 
 good faith in the nation, to this bank, is pressed as an authority to bind this 
 House to consider the constitutionality of this question as settled; but the 
 good sense of this body will secure the United States from the calamity of re- 
 chartering this bank, and committing the best interests of this nation to its 
 foreign and domestic enemies. 
 
 Now, sir, having presented this view of the unconstitutionally of this ques- 
 tion, I must beg the further indulgence of the House while I present also my 
 view of its inexpediency. 
 
 Sir, this charter is very nearly allied to the funding system; they had a co- 
 eval conception, and the same progenitors. They were conceived in sin, 
 and born in iniquity. The funding system was founded in the basest of 
 frauds to the best of men, the war-worn soldier, whose necessities compelled 
 him to part with his certificates, the price of his blood and toil during an eight 
 years' war: and out of which the arch speculator, availing himself of those 
 necessities^ had trepanned him, at ha!/ a crown in the pound. These certi- 
 ficates, sir, were landed to the holders, with their interest, at par, and with 
 other certificates, for supplies for the army and navy, which had also depre- 
 ciated, were funded at par; and although it was ably contended, that the certi- 
 ficates granted to the original holders only, should be funded at par, and that 
 those held by speculators should be funded at a certain exchange. Yet, sir, 
 such was the influence of that well organized band, under the auspices of the 
 then Secretary of the Treasury, that no discrimination could be effected 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 whereby Congress might have been justified in paying the poor soldier for his 
 loss, by being obliged to part with his certificate at less than its nominal value; 
 a loss occasioned by the inability of Congress to pay them at the time, agree- 
 ably to their contract; a loss by Congress forcing upon them these certificates, 
 ana their total inattention to the payment of them, for many years, and until 
 they were possessed by the hopeful band of speculators, who were the active 
 agents of this system. As an evidence of its corruption, the continental bills 
 t credit which had been issued from time to time, were to be funded at one 
 dollar in the hundred- They, sir, were as a circulating medium in the hands 
 of the People, who, however honestly they might have receivedSthem for sup- 
 plies to the army and navy, at the same time, and at the same price that their 
 neighbors furnished them supplies for which they took their certificates, 
 which this system funded ai par for the benefit of speculators, while the hold- 
 ers of the bills of credit were funded at one hundred for one could, sir, any 
 tiling but corruption have prevented the discrimination between the original 
 holders of the certificates and the speculators, or have induced the funding of 
 certificates (for supplies furnished at the same time and the same price) at par, 
 that denied it to those holding the bills of credit? 
 
 This banking system was partly made upof these corrupt materials of the 
 funding system, which composed a portion of its stock; was illegitimate in its 
 conception, partial in its establishment, and corrupt in its administration; is a 
 mammoth moneyed aristocracy, violative of the constitution, of unlawful origin, 
 under the control of foreigners, who have proved their principles, by the se-. 
 lection of its directors all federalists. This stock was to be subscribed at a 
 short day in Philadelphia, convenient only to that neighborhood : it was therefore 
 partial When in Maryland a bank is to be established by law, the propor- 
 tion of each county is allotted to it; books are opened, and the stock subscrib- 
 ed for in each county; and why were not books opened in each State, and 
 their portions of the stock allotted to them, as in Maryland? Sir, when we 
 consider that the directors of the mother bank in Philadelphia are elected 
 under the influence of foreign stockholders, to the amount of upwards of seven- 
 tenths of the whole capital,, we are not left much to conjecture, why these 
 twenty-five directors are all of a particular political complexion, nor why a 
 list of them, and of the directors of the branches, (as required) has not been 
 furnished, as an agent here had it in his power. Sir, I should have been glad 
 of the list, as, being prett}' well read in the biography of the people of this 
 country, 1 should lutvo been enabled to have pointed out, I have no doubt, a 
 number of traitors to the Revolution, Burrites, and embargo breakers; the 
 whole phalanx being at every stage of the republican administrations of this 
 country, \\i\hfew exceptions, opposed to every measure of those administra- 
 tions. I am a little surprised at their temerity in asking, and expecting a re- 
 newal of that charter, by which its directors have used their influence cor- 
 ruptly, to control the measures of the Government, and the elections of the 
 patriotic favorites of the People. We have seen a petition, signed by a num- 
 ber 'of the merchants of Philadelphia, addressed to General Washington, to 
 ratify Jay ? s memorable treaty, a number of whom were known to have been 
 its bitter enemies; and it is a well known fact, that the reason assigned by 
 them for that act was, that they were induced to subscribe it under the threats 
 of these bank directors, that, if they did not, they need expect no more accom- 
 modation at the bank. We have seen, at Baltimore, their influence exerted 
 in the memorable election between Gen. Smith and Mr. Winchester, where 
 Edward Johnson, now mayor of Baltimore, and a bank director of the State of 
 Maryland, and Mr. Matthews, now and often a bank director, were put out 
 because they had the presumption to think for themselves, and the temerity 
 to vote for General Smith. These gentlemen were of unblemished reputation, 
 and equally entitled to respect with their successors. I have not a single 
 doubt but they did not suit the directors of the mother bank; they had sup- 
 ported a patriotic soldier of the Revolution, a sin of too deep a die to be for- 
 given by this Britannic chosen band, who have lately put the seal to their 
 principles in the election of Evan Jones, now president of the branch bank at 
 26 
 
202 BANK OF THE UNITED STATES. 
 
 New Orleans, who succeeds a gentleman of republican principles. This Mr 
 Jones is said to be a refugee from the United States at the commencement of 
 the American Revolution, and a British officer during that period, who has been 
 lately more than supected to be one of Burr's chosen band. If, at a time when 
 the directors are soliciting the renewal of their charter, they can thus outrage 
 every principle for which our patriots bled, and prefer the parricide to the pa- 
 triot^ at a time when the eye of the nation was fixed upon them; what, I ask, 
 after a twenty years' renewal of the charter, may they not be expected to do, 
 or how, in the case of a war with Great Britain, might they not be expected to 
 act? How would a patriot of America be expected to act in supplying funds 
 to our enemies, to prosecute a war against this country? It would certainly 
 be a treasonable adhering to our enemies, giving them aid and comfort. But, 
 sir, we are told this is a harmless institution, all important to the fiscal con- 
 cerns of the United States; influenced by no motives but the common good. 
 Strange, indeed, would it be, to ascribe to the stockholders of seven-tenths of 
 the capital of this bank, (reported by the Secretary of the Treasury to be fo- 
 reigners) and known to be Englishmen, a disposition friendly to this coun- 
 try. Sir, here is a strong foreign influence on the moneyed concerns of this 
 country; money has been correctly called the sinews of war; and are we to 
 suppose that Britons are not as much attached to their country as Americans 
 are to theirs; or that the strength and influence of this institution will not be 
 put in full operation against us, when it has been committed to the care, and 
 put under the direction of men, known to be in hostility to the best interests 
 of this country? 
 
 Gentlemen on the other side, however, insist that there is no improper _ in- 
 fluence to be apprehended, and deny it to be a party question, although it is 
 well known to have originated in party, under the auspices of the great federal 
 leader, Alexander Hamilton; although it has been conducted by directors of 
 the mother bank, exclusively federalists; and although every federalist in this 
 House is now its advocate. It is said to be harmless; I think, sir, the placing 
 in the hands of twenty-five directors, elected by stockholders, seven- 
 tenths foreigners, to have the direction of twenty millions of dollars, when 
 money is admitted to be the sinews of war, particularly when we consider 
 their political complexion, and retrace their political conduct, cannot be safe 
 to our republican institutions, on the score of its moneyed influence; but when 
 we consider the patronage of these directors, who, by the charter, have a right 
 to establish as many branches in the United States as they please, say one to 
 each State, with the appointment of thirteen directors, a president, and seven 
 officers to each branch, with as great accommodations as directors, and salaries 
 to their officers averaging a thousand dollars a year, each making upwards of 
 one hundred and seventy thousand dollars to their officers, and more to their 
 directors sir, this is a patronage greater than is possessed by the President 
 of the United States; and will any gentleman who regards the solid interest 
 of this country, be disposed to give this aristocracy, organized as it is, and 
 composed of such materials, the key of this treasury, with its privileges? I 
 had always supposed that the treasury of this country ought to be in the hands 
 of representatives of the American People; they are said to hold the purse string 
 of the nation's treasure, and not that body who now directs this bank. Have 
 they not denounced the administration, and every measure of the Government, 
 and supported its most inveterate enemies? But, suppose them to have been 
 correct in all their measures, ought the nation's representatives to give to fo- 
 reigners, knowing them to be such, the immense advantages flowing from the 
 renewal of this charter, or to one set of her citizens this benefit, which they 
 have enjoyed for twenty years, in exclusion of her other citizens, who, to say 
 no more, are equally entitled to the favors of Government? 
 
 If, sir, we have the power, and feel it necessary to the fiscal concerns of the 
 nation, to have a national bank, the eight millions two hundred thousand dol- 
 lars held by foreigners in its funds ought to be withdrawn, and that share of 
 stock distributed among the States, having an eye to the stock already held by 
 citizens, so that the proportion of each State, agreeably to the relative census 
 
ON THE KILT. TO RENEW THE CHARTER OF 1791. 203 
 
 t>fthe States, might be apportioned and subscribed, whereby the establish- 
 ment might be purged of its foreign influence. But, it is said, these foreign- 
 ers will send their gold to England. Can any man of sound judgment sup- 
 pose they would transfer their capital to England, and take four per cent, in 
 England, and that in paper, when they can loan their money in this country, 
 at nic per cent, and get the interest in specie? 
 
 Sir. there can be no possibility of their exporting their stock in specie very 
 speedily, when you take a view of the late report of the treasury; they will not 
 have specie to meet the specie engagements of the bank. Sir, this institution 
 was established by the Secretary of the Treasury without a bonus, or any solid 
 advantage to the United States: he well knowing what had been the en- 
 gagements of the stockholders of the Bank of England, at its establishment, 
 and frequent extensions in its accommodations to the British Government; 
 and that the derangement in its fiscal concerns had forced these extensions on 
 that Government. He also well knew that, when the two insurance fire com- 
 panies, the London and the Royal Fire Insurance Companies were es- 
 tablished, with a capital of four hundred and fifty thousand pounds sterling 
 each, they gave as a bonus to the British Government, one hundred and fifty 
 thousand pounds sterling each; and yet this experience was not turned to the 
 benefit of the United Sta es; but, this charter was granted without any bene- 
 fit but to speculators, who were holders of the funded debt, which was made 
 a part of the stock of this bank. .Sir. in the provisions of the law for the esta- 
 blishment of this bank, whose capital fca.-i fo have been ten millions of dollars, 
 the stockholders were so favored, us to lu> permitted to go on as soon as four 
 hundred thousand dollars wero paid in, (one twenty : fifth part of the capital) 
 and thus, on that small sum, they proceeded to business, and soon received 
 an interest on fifteen millions of dollars; and so much in conclave are its con- 
 cerns, and so much under tlu 1 control of men of a particular political complex- 
 ion // 1 he directors of the mot her bank, at all times, have been federal, or worse, 
 many of them toric-s, or monarchists so that, as to its secrets, it might be com- 
 pared to the inquisition; and being under such control, I have ever doubted 
 the statement of its funds. Sir. the humiliation of having such an assemblage 
 of characters, selected by foreigners, to select directors for the branches in 
 each State, has ever boi'ii truly grating to the honest feelings of republicans, 
 and violativeof the rights of the States, to whom an independent republican 
 Government has been guarantied. 
 
 Sir, there can be n<> necessity for this bank. The State banks are abun- 
 dantly sufficient to supply every requisition, if the United States' deposites are 
 made in them. This goes all lengths to defeat the arguments of gentle 
 men, predicated on the principle of necessity, as vesting this po\yer in Con- 
 gress. There are banks, in Baltimore, alone, with a nominal capital of eight 
 millions two hundred and eighty thousand dollars, four millions nine hun- 
 dred thousand dollars of which is paid in: and if a ?io?m/ capital of the Unit- 
 ed States' Bank often millions of dollars, with four hundred thousand dollars 
 only paid in, could begin and progress in business, is it possible to doubt that 
 the banks of Baltimore, with four millions nine hundred thousand dollars paid 
 in, already in operation, could not go on, with the deposites of the United 
 States, and extend their business, so as to give every necessary accommodation 
 to individuals, and the public? Can there be any magic in the U. States' Bank? 
 Or can any honest American feel a predilection to its foreign stockholders, 
 or to their hopeful selection of directors? 1 trust not. Therefore, there can 
 be no cause of alarm; no danger to the fiscal concerns of the nation. But, sir, 
 many of the States have banks, and will no doubt conduct them as honestly 
 and impartially as the United States' Bank has been conducted, and under the 
 direction of men the United States may as safely trust, and on whom the pub- 
 lic may as confidently rely for accommodation, unless, perad venture, some 
 gentlemen might repose more confidence in foreigners, than in their own citi- 
 zens; but. I hope and trust there are none such within this sanctuary of the 
 liberties of the nation. We have been told by the gentleman from New York, 
 (Mr. FISE) that agriculture, roimayrce. and manufactures, will receive a vital 
 
204 BANK OF THE UNITED STATES. 
 
 stab, by suffering the. charter of this bank to expire. This is a groundless 
 phantom, produced by the feverish fancy of this gentleman, laboring under 
 the bank mania; but, sir, if agriculture, commerce, and manufactures, were to 
 feel it, in the extent suggested by the gentleman, I trust those classes of our 
 fellow-citizens would bear it with fortitude, when they reflected that it could 
 not be renewed, but by a violation of the constitution of the United States; a 
 violation of the rights of the States, to whom is guarantied an independent 
 republican form of government; and perhaps a violation of our independence, 
 for which the best blood of our heroes was shed on the altar of liberty. This 
 charter is a cancer on the body politic, which I hope we shall suffer the hand 
 of time to eviscerate and eradicate, and no longer suffer any foreign agency in 
 the regulation of the internal affairs of this country; and that we shall preserve 
 our fiscal concerns from the influence of those, whose interest it is to destroy 
 them. But, we are told by the same gentleman, that the Secretary of the 
 Treasury, whom he calls the Chancellor of the Exchequer, has reported this 
 bank..as necessary to the fiscal concerns of this country; and I suppose, by 
 giving the Secretary of the Treasury the title of Chancellor of the Exchequer, 
 he wished to impress this House with the powers of that officer, in England, 
 to give an imposing influence to the Secretary here: and while he advocates 
 the interest of these foreign stockholders, he so far forgets himself, as to intro- 
 duce into our Government, a Chancellor of the Exchequer. But, I hope we 
 shall exercise our own judgment, and be satisfied with our own Government, 
 organized as it is, disregarding the principles of foreign Governments, and 
 the interest of foreign stockholders. Sir, we are told by the same gentleman, 
 that Congress sold to foreigners, two hundred thousand dollars of the stock in 
 this bank, but a few years ago; and therefore we ought to renew the charter. 
 Sir, the purchasers knew the tenure by which this charter was held, and the 
 precise moment of its death; they bought it as it was, a perishable article, and 
 the selling of the stock by the United States, ought to have been considered 
 as the tocsin of its dissolution, at the time appointed for it. The claim to renew 
 the charter on that ground, is as ridiculous, as for a man who had bought a 
 horse, on his death, to demand another. We are told of the vast inconvenience 
 our merchants will experience, by not having an universally circulating medi- 
 um. How, say they/can money be paid by a Bostonian, at New Orleans? Sir, 
 money is not paid in large commercial transactions; and if it were, would it 
 not be an easy matter, if a merchant has Boston bank notes, to get the specie 
 for them, and send that to New Orleans? How, J ask, would he do if he 
 wanted the money at the Havana, or any foreign port? And why cannot he 
 do the same at New Orleans? Sir, this is the common lot of merchants; but, 
 sir, if the gentleman had Boston United States branch bank notes, could he 
 get gold for them at the New Orleans branch bank? No, sir; and a gentleman 
 who had five hundred pounds in the United States mother and branch bank 
 notes, might have to travel to every State having a branch, to get the specie, as 
 neither will give specie for the paper of the other, and are to that purpose fo- 
 reign to each other. Indeed, it has been suggested, as a practice, to secure 
 the banks from a pressure for specie, to circulate the Eastern notes to the West, 
 and so, vice versa, whereby the holders, on the fourth of March, will be put to 
 great inconvenience in procuring specie for them. Sir, the people of England 
 had no national bank till the year sixteen hundred and ninety-seven, less 
 than a century before the establishment of this bank, and they were enabled to 
 conduct their great commercial concerns, to great advantage; and the United 
 States had an extended commerce, before the establishment of this bank, and 
 I trust her merchants will be able still, to conduct advantageously, their com- 
 mercial concerns, without our sacrificing the constitution we are sworn to 
 support, or being tributary to foreigners, whose interests I never can respect, 
 when in collision with that of the American People. 
 
 Mr. BOYD said he was unwilling to give his vote on the question of indefinite 
 postponement, without offering to the House, and those that he in part repre- 
 sented, his sentiments. I shall vote, said he, for the postponement; and, 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 should that vote not prevail, then against the bill, in its present form, and every 
 other in which it may be presented to me, for a renewal of the charter of the 
 United States' Bank, predicated on the original grant: because, to my mind, 
 it is unconstitutional. Arid here, Mr. Speaker, you must allow me to go back 
 and take a look at the time and manner of its creation, and how it originated. 
 To my mind it was created in aid of the funding system; and what was that 
 debt, so created, not contracted? Was it for the redemption of the bills of 
 credit, called Congress money, that paid your army in the field, fed and 
 clothed them for years? No. Was it to redeem said bills that were paid to 
 the fanner for his Hour, beef, teams, hay, and supplies to the army? No, no. 
 How, then? Why, after those bills hail so far depreciated that the farmers 
 were unwilling to receive them, then certificates were given at the compara- 
 tive price of those depreciated bills. Then again it became necessary to liqui- 
 date those certificates down to specie value. Were they called in then? No, 
 no, sir; no redemption yet: and let me tell you, sir, it was that paper and 
 credit that placed you in that chair, and me on this floor. Well, next the 
 constitution is formed, and Congress set themselves about paying the debts of 
 the United States, and some part of the several States" debt. Mr. Speaker, 
 how was it done? Runners go out, in every direction, to purchase those liqui- 
 dated certificates, and they succeed at 2s. Gd. in the pound value, up to 8s. 
 All the certificates funded did not, on an average, cost the purchaser more 
 than five shillings in the pound. Now, sir, the bills, called Congress money, 
 are all, or next to all, sunk in the hands of tlu- holders, and fifteen shillings 
 in the pound of the residue. Now, sir, an act of general justice takes place! 
 The said certificates are funded at 'JO.*., or their nominal value, to the specu- 
 lator! and an interest of six per cent, per annum ^iven to him; to pay which 
 duties are laid, and money borrowed to pay the interest in advance of the 
 revenue. A charter is now granted for a bank often millions of dollars, seven 
 and a half millions of which was to be this aforesaid State paper, and two mil- 
 lions five hundred thousand in specie: and when a small part of that was paid 
 in, they were allowed to begin their discounts, and issue their paper to double 
 the amount of the whole capital! viz.. twenty millions; these certificates 
 drawing six per cent, making seven millions five hundred thousand of the 
 stock. Now, this part must, according to this statement, give to the stock- 
 holders eighteen percent, for the deposite of this State paper, and twelve for 
 the residue. Now, Mr. Speaker, I will ask \\hcre was the redemption for 
 these bank notes so issued? Surely not in the bank, for that vyas seven and a 
 half millions State paper, as above, drawing six per cent. Not in cash, for that 
 was not supposed to be there. Therefore, to my mind, this was a great decep- 
 tion; swindling, I will call it. Ah, but, say some, by this means you were 
 furnished with a capital, ami enabled to carry on comnierce to a great extent. 
 I deny the fact our capital was the produce of our soil and industry. Banks 
 at best are no more than a conveniency to merchants: and I respect honest 
 merchants; they are useful and necessary; but I do not include bank stock- 
 jobbers, or men calling themselves merchants, without a capital; mere drones 
 in the hive. No, sir, the latter is a moth to the commonwealth. 
 
 It appears to me, that this scheme of banking is an evil in its operation, 
 something like the faro table, always, in its operations at each round, deposit- 
 ing six per cent, to the stockholders lor what? The exchange of a note dis- 
 counted, and the note so lodged the best of the two! Ah! and is this indeed 
 the capital of our country? Sir, I am lost in the chicanery. The banks enable 
 us to over-trade on a false capital: depreciate our property; demoralise our 
 citizens, and take or send the gold and silver out of the country. Let me 
 state this a little further. I will suppose a line drawn at a distance from the 
 sea of fifty miles, the whole length of the continent. I would ask, if the cul- 
 tivation of that tract of country would be equal to the maintenance of them- 
 selves and those collected in the cities? I believe not. Then, again, let me 
 suppose that, on an average, the whole length of our country we cultivate to 
 the distance of two hundred miles from the sea board. Then, it appears that 
 the average distance that we have to take all our transportable produce is one 
 
206 BANK OF THE UNITED STATES. 
 
 hundred aixl twenty-five miles. It is believed that the cultivated distance 
 is, on an average, nearly four hundred miles, which will enhance the price of 
 transportation, mostly by land, to the cities. Now, sir, at the general price, 
 one-third, and in some cases one-half, is expended in getting the produce 
 there. But this is kept out of sight, and much said about high and great 
 prices obtained by the farmer. K is nominal, not real. It is paid them in 
 depreciated bank paper. Sir, I do contend that not only the bank paper is 
 depreciated, but that, by the means of its abundance, the gold and silver is 
 depreciated. One dollar, eight years since, was worth more than one dollar 
 and fifty cents is at this day. Besides all this, I ask, is there cash in their 
 vaults to redeem their bills? No, no, sir; not for one-half. Thus, sir, are the 
 People swindled out of their proporty to support gambling and chicane. Is 
 this what enhances property, and gives a capital to carry on commerce? No, 
 for myself, I think not. It is the product of our soil and our industry that is 
 the capital, and on that we do and ought to trade; and that trade ought to be 
 internal, turned to our own manufactories in a great part. I do not say that 
 banks are not convenient and useful, to a certain degree; but I do not think 
 the advantage is equal to the disadvantage. I am well aware that such senti- 
 ments will be treated with ridicule; but, sir, that does not intimidate me; 
 they are my sentiments, and, as such, I give them without the least fear of 
 intimidation, having in view the happiness of my country; and I will venture 
 to say, that the day is not far distant, if we progress as we have done with 
 banks, that the country will experience an universal shock from this false 
 capital. Before you, sir, arc propositions for charters of incorporation, within 
 this District, for banks, to the amount of four millions! Can there be a want 
 of capital? If there is, how is this stock to be furnished? 
 
 N. Mr. Speaker, we hear from Richmond, Baltimore, and Philadelphia, much 
 
 ^ said against the renewal of the United States' Bank charter, and I agree with 
 them; but, I believe, from very different principles. The profits of the Uni- 
 ted States' Bank have been, from their issues, and the deposites of the revenue, 
 and private individuals, immense; arid they want the cards in their own hands 
 to play the same game. I think they are not entitled to much credit. The 
 odds consists in this: the one is against the constitution, the other not; the 
 principle is the same in both. 
 
 Mr. Speaker, if we must have a national bank, let it be so in reality. I 
 shall not attempt to go into the detail of such an institution. It is not my 
 h. purpose; but 1 think that it might easily be done by making a portion of our 
 public lands the foundation of such part as the United States should choose to 
 subscribe or hold the bank to be created in the Distiict of Columbia, and to 
 extend branches into such States as, by law, would choose to accept them. 
 Sir, I had much more to say on this subject, but I perceive that the House is 
 impatient, and I do not wish to detain them, and shall add no more. 
 
 Mr. McKEE. Residing, as I do, in a part of this country remote from the 
 scene of bank operations, I had determined to say nothing on the subject, con- 
 tenting myself by giving a vote flowing from the honest convictions of my 
 heart; but the extraordinary manner in which this discussion has been mana- 
 ged, on the part of the opposers of the bill, by attempting to make it a party 
 question, has compelled me to commence my defence of the vote I expect to 
 give, on this motion. So* far as I know, or believe, my suffrage in favor of a 
 renewal of the charter of the United States' Bank is in conformity with the 
 views and wishes of the people I have the honor to represent; and any change 
 in their sentiments, which might be effected by the frequent appeals to their 
 passions and prejudices, made in the form of argument, it becomes my duty 
 to correct. 
 
 We are arrested in the threshold of this discussion by a constitutional ob- 
 jection, by which it is alleged, that Congress do not possess the power of re- 
 newing this charter. I had thought this question long since settled, not alone 
 by those who originally granted the charter, but confirmed by Mr. Jefferson, 
 and the votes of a republican Congress. I have been led to this opinion by a 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 207 
 
 recurrence to the act of Congress of (lie 23d of March, 1804, by which the pre- 
 sident and directors of the Bank of the United Slates are authorized to esta- 
 blish offices of discount and deposite in any of the territories or dependencies 
 of the United States. A gentleman has said, this was a power possessed ori- 
 
 finally by the bank. If so, for what end was this law enacted? It must either 
 ave been enacted from an opinion that the charter could not, without this 
 aid, be extended to New Orleans, or that it was proper and necessary, in order 
 to the well-management of the fiscal concerns of the country, that this institu- 
 tion should be extended to New Orleans. Either case answers my purpose: 
 for, if the bank could not, without this act of Congress, establish an office of 
 discount and deposite at New Orleans (which seems to me to be the better 
 opinion) then the passage of a law, extending the influence, the power, and 
 the profit of the bank, cannot be considered in any other light than a tacit and 
 full acknowledgment, on the pail of Mr. Jefferson and the republican Con- 
 gress, that the charter was within the pale of the constitution: for, sir, can it 
 Be supposed that Mr. Jefferson and Congress, who were more republican in 
 1804 than at any other period, would have extended, bolstered up, supported, 
 and cherished an institution, originally obtained by a violation of the sacred 
 charter of our political rights? No, Surely, it is impossible. And if, sir, 
 this office of discount and deposite was induced to go to New Orleans because 
 it was necessary and proper to be sent thither for the better management of 
 
 J 1 11,' * , , . I ,1* ' 1 " ^ J I 1 1 , 
 
 the collection of taxes at that port, this circumstance admits the only fact ne- 
 ?ssary to be in proof to establish the power of Congress to pass the law. 
 If, sir, any additional proof could be wanting to show that the power of Con- 
 
 gress, under the constitution, has been considered sufficient by this adminis- 
 tration to authorize them to grant the charter in question, it is abundantly 
 furnished by the act of Congress of the -Hh of February, 1807, for the punish- 
 ment of frauds committed on the Bank of the United" States. By this law, 
 Congress have subjected the citizens of the United States to capital punish- 
 ment for counterfeiting the notes of the United States' Hank. Now, if Con- 
 gress by the constitution had not the power, originally, to grant this charter, 
 the notes of the bank were certainly issued in violation of the supreme law of 
 the land, and Congress had no power whatsoever to pass a law making that 
 criminal which was in itself no crime, and could not, by any conception what 
 ever, be considered as a violation of any law of the United States. It seems 
 to me to be perfectly paradoxical and absurd to say, that any institution, hav- 
 ing no legitimate right to issue paper, nevertheless has a right to the interpo- 
 sition of Congress in their behalf, making it a crime against the United States 
 to counterfeit this paper, which was issued in violation of the supreme law of 
 the land, ruder this act of Congress, the citizens of the United States have 
 been deprived of their liberty as well as subjected to heavy fines, by the deci- 
 sions of your courts. A citizen of Kentucky has been doomed to confinement 
 in the jail and penitentiary house for a violation of this act of Congress, and 
 he was not relieved from the fangs of the law by the President, (Mr. Jeffer- 
 son.} How are these things to be reconciled on any other ground than by ad- 
 mitting the constitutional validity of the original act granting the charter? 
 
 But it has been stated that this charter, when originally granted, operated 
 in the nature of a contract; and that Congress could not repeal the act of a 
 former Congress granting a charter; and hence the power to make, and pro- 
 priety of passing the act in question. This idea is altogether fallacious, be- 
 cause it is an indispensable requisite to all contracts, that the parties thereto 
 shall be able to contract. If the constitution vested no power in Congress to 
 make the contract, it was absolutely void; and if the Congress of 1807 were 
 thus impressed, they could not and would not have passed the law in question; 
 and, therefore, I infer that they considered that the constitution had vested 
 Congress with the power to grant the charter. 
 
 In addition to this, we find that the present Secretary of the Treasury, 
 under the auspices of Mr. Jefferson, made a report in favor of the renewal of 
 the charter of the United States' Bank, in pursuance of a resolution of the 
 Senate, passed on the subject. This report called forth no animadversions 
 
208 BANK OF THE UNITED STATES. 
 
 from any section of the country; and I have ever understood, that, if this 
 question had then been brought forward, it would have passed by a large ma- 
 jority of Congress. These circumstances have led me to suppose this ques- 
 tion had received the ratification of every party, and of every administration; 
 and, what is still of more importance and higher authority, the sanction and 
 confirmation of the sovereign People, arid therefore considered as an adjudged 
 case, tested by experience. 
 
 I shall not consume the time of the House by any enumeration of the powers 
 of Congress, arising from the constitution itself, with a view to prove that 
 Congress originally had the T power to pass the law granting this charter, and 
 still possess it, because this ground has already been occupied with great abi- 
 lity, and the power of Congress to pass the bill clearly shown, and any remarks 
 \vhich I might make would only be a repetition of the arguments of others. I 
 shall therefore content myself by answering some objections made to the bill. 
 
 It is said the bank will be a thorn and a viper in the bosom of the United 
 States, which will ere long sting the political liberty of this country to death. 
 This is a strong charge, and if it is found to be true, it must be conclusive 
 against the bill; but let us examine this bold assertion by the test of reason 
 and experience. This charter was given by Congress twenty years ago. Since 
 that time the constitution, and the political liberties of this country have been 
 in the hands of our political opponents, and are now in our hands unimpaired. 
 The country has, in the latter period, been prosperous beyond example. Agri- 
 culture has prospered, commerce has flourished, internal improvements have 
 increased; the People have enjoyed peace, prosperity, security, and happiness, 
 in a degree infinitely superior to that of any other nation on earth. No dele- 
 terious consequences have grown out of this institution, affecting the security 
 or liberty of the citizen or the country. It is said, and truly too, that ours is 
 a Government of experiment, none similar too it ever having existed before. 
 Here, then, is the test of experience in favor of this institution; and why dis- 
 continue it to try some devious and unknown track? 
 
 But, sir, suppose there is something of truth in this statement, I ask if State 
 banks are not equally as dangerous to the political liberties of the States, as 
 this bank can be to the United States? And, if the political liberties of the 
 States are stung to death, I ask where will you find the liberties of the United 
 States? I believe they will sink with the liberties of the States. But, if gen- 
 tlemen are really serious on this subject; if they believe that banking is fraught 
 with thorns, ana not with roses, and wish to return to the state of native sim- 
 plicity which existed in the pure ages of ancient Greece and Rome, I will 
 unite with them as far as we have power in plucking up by the roots this mon- 
 ster, and make a common bonfire of the charters of every bank in the nation. 
 To do less would not cure the evil, if any exists. 
 
 But it is said that this institution will destroy republican principles, and 
 federalise the country. This bank, as 1 have already stated, was in opera- 
 tion in federal times; and, notwithstanding its influence, those times have 
 changed; experience, the best possible test of human affairs, does not bear 
 gentlemen out in this assertion. On examination we find, that the States of 
 Rhode Island, Connecticut, and Dela\yare, are the only States in the Union 
 who are represented in the Senate and in this House, exclusively, by federal- 
 ists; yet there is not now, and never was, a branch of this bank in either of 
 those States; but there is a branch bank in Georgia, South Carolina, Virginia, 
 Maryland, New York, and Massachusetts, and the mother bank in Pennsylvania. 
 The two first are exclusively republican States, and those parts of all the 
 others, (except Massachusetts) where those banks are seated, are represented 
 on this floor by republicans; whence, then, are found the facts to prove this 
 assertion? or do gentlemen pursue a recent example, set by a certain great 
 man, of giving opinions, when, with the same breath, it is acknowledged there 
 exist no facts on which they are founded? 
 
 The foreign capital employed in this bank is a ground of great alarm to 
 some gentlemen. In answer to this objection, I would ask, if it ever has 
 been, or if it is now, the interest or the policy of the States, or the United 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 209 
 
 States, to exclude foreign capital from being received and employed in your 
 country? Do you find any provision in the charters of the State banks, pro- 
 hibiting fereigners from becoming stockholders? Is there any provision in 
 those bills fro n the Senate, establishing half a dozen banks in the District of 
 Columbia, prohibiting foreigners from becoming stockholders? To all these 
 questions you are compelled to answer in the negative. So long as the pro- 
 fits of agricultural pursuits, or commercial enterprise, furnish the adventurer 
 with a good profit, over and above the price he nas to pay for the use of the 
 capital employed, just that long will he continue to employ it; and, if the 
 capital is not to be found at home, application will be made for it abroad; and 
 whenever capital becomes redundant at home, you will then exclude foreign 
 capital. Before that time, the attempt would be unavailing: for, capital, like 
 air or water, will seek its level. I have thought that foreign capital, in this 
 country, would have had rather a salutary tendency, inasmuch as it would 
 interest men of influence in the preservation of the peace and perpetuity of 
 the Government. Mr. Jefferson must have been thus impressed, or how could 
 he have permitted a sale of the bank stock of the United States directly to 
 Englishmen; and he was certainly not chargeable with a predilection in favor 
 of British influence. There is in England a class of men favorable to the 
 prosperity of this country; and I have always understood that it is those alone 
 who have interest in our funds. Besides, if this foreign capital is fraught 
 with all those evils which gentlemen picture to themselves, the argument holds 
 good against State banks, and goes to prove the necessity of their destruction 
 also. 
 
 The gentleman from Maryland (Mr. WRIGHT") has made some heavy charges 
 against the directors of the United States' Bank and their management. I 
 had thought it universally understood and admitted, that the management of 
 this great moneyed institution had been exemplarily correct, and 1 have not 
 before heard any thing of the kind laid to their charge. But, even admitting 
 the charge to be true, it only proves, what may. I believe, be alleged and 
 proved against every human institution administered by man, viz: that the 
 institution, as well as the administration thereof, is imperfect. But I ask if 
 the directors of three-fourths of the State banks in the United States are not 
 federalists; and, therefore, why not put them down in mass? 
 
 I beg leave to notice an argument which has been resorted to by all the op- 
 posers of the bill, when they have been told that the bank was both necessary 
 and proper to die convenient and advantageous management of the public re- 
 venues. The answer has uniformly been, that this difficulty could easily be 
 obviated by the agency of State banks. This, sir, is certainly begging the 
 question; because, an admission that bank agency is necessary to the collec- 
 tion of your revenue, and proper to be used in the management of the moneyed 
 concerns of the Government, is an admission of the only fact necessary to be 
 in proof to show, conclusively, the power of Congress to pass the bill in ques- 
 tion. Besides, do not all the unhappy consequences, which, is it said, await 
 this bank, attend the depositing your money in State banks? Will you not, 
 thereby, give a circulation to the paper of the bank where you make your de- 
 posites greater than heretofore? and, by increasing the circulation of their 
 paper, as well as by aiding them with your money to make more extensive 
 discounts, you [increase the profit and value of the stock. This circum- 
 stance will create an anxiety with all the State banks to obtain your deposites; 
 and, hence, tha United States, if they are so disposed, can operate through 
 those favorite banks as effectually on the People of the States, as they could 
 by the United States Bank. You have all the evils of the United. States 
 Bank without any of the advantages; you also throw into circulation a hetero- 
 geneous masss of paper that no body knows any thine about, issued by esta- 
 blishments of whose solvency you know nothing. Will the gentlemen from 
 North Carolina, or] the members from Massachusetts, willingly receive their 
 per diem in their own State paper? 1 believe they would not yet the effect 
 of using State banks, for revenue purposes, will be to impose this paper on 
 the People of the United States. 
 27 
 
210 BANK OF THE UNITED STATES. 
 
 It is a rule, sir, which I have prescribed to myself, in the management of 
 the concerns of others which may be committed to rny care, in any character, 
 to conduct them in such a manner as to produce no individual distress or loss, 
 which may not be fully compensated by an equivalent certain public good; 
 and I shall not relinquish the observance of this rule on this occasion. We 
 are informed by various gentlemen, who are charged with the representation 
 of the more commercial States, that great individual distress will be the cer- 
 tain consequence of a refusal to renew the charter of the United States Bank; 
 and that the distress will fall, with accumulated weight, on those who have 
 poverty and the frowns of fortune to struggle with, is evident; and, when I 
 commiserate the woes felt by the citizens! of every part of our country, my 
 attention, as it ought, is particularly drawn to the losses and distress which 
 will be felt by my immediate constituents. 
 
 If this charter is not renewed, it is my deliberate opinion that the farmers 
 of Kentucky will sustain a loss thereby to the amount of near 200,000 dollars; 
 and I will now attempt to show that this opinion is not altogether chimerical.. 
 I am unable to state, with any great certainty, what is the amount of circulat- 
 ing medium of the United States; nor,' indeed, is it necessary for me to state, 
 with great accuracy., the precise amount. I suppose the whole circulating 
 medium of the United States ,to be upwards of 50,000,000 dollars, and that 
 of this sum the Bank of the United States circulates one-third. It is a fact, 
 frequently stated in this House, and which stands undenied, that money, or 
 circulating medium, is scarcer in the United States, at this time, than it has 
 been for several years past, owing, perhaps, to the unproductiveness of com- 
 mercial enterprise; or, if you please, to the natural increase of population, 
 and the proportionate increase of demand for money. By refusing to renew 
 the charter, you throw out of circulation one-third of the money of the coun- 
 try. The necessary and inevitable consequences of this act of the Govern- 
 ment will be to diminish commercial enterprise in the same proportion, and, 
 consequently, ship building and ship repairing will be diminished in a like 
 proportion, arid the materials, for this service, will not be wanting. By let- 
 ters recently received from very intelligent merchants of Lexington, Ken- 
 tucky ? I am informed that 6,000 tons of hemp will have been raised in that 
 State in the past year. The ship owners are the consumers of this article; for 
 not one pound of it goes abroad, and from 6 to 9,000 tons of hemp is the quan- 
 tity consumed in prosperous times in the United States. These 6,000 tons of 
 hemp, together with what will be brought to the market from other States, 
 will furnish an abundant supply for the present year, even admitting it to be 
 a prosperous year. By the refusal to renew the charter you lessen the de- 
 mand one-third at least, and, consequently, you diminish the price of the ar- 
 ticle in the same proportion. But, sir, this is viewing the consequences aris- 
 ing out of the rejection of this act in the most favorable light. If the refusal 
 to renew this charter should, as some gentlemen apprehend it will, bankrupt 
 not only many individuals, but also some of the State banks, a general alarm 
 may take place, which would, for a time, put an end to all credit and to all 
 business. The consequences of such a state of things are much to be feared* 
 and much to be dreaded, by every portion of the community. 
 
 It has been stated that the United States' Bank can be|dispensed within the 
 collection of your revenue, and in the management of your moneyed con- 
 cerns. I wish to know how gentlemen can malte this statement. I perceive 
 that General Hamilton, the first Secretary of the Treasury appointed since 
 the adoption of the constitution, in his argument on the subject, decidedly de- 
 clares that the bank is necessary for the collection of the taxes, and manage- 
 ment of the fiscal concerns of the United States; and Mr. Gallatin, the pre- 
 sent Secretary of the Treasury, makes, substantially, the same declaration to 
 you in his report on this subject 
 
 [Mr. WRIGHT observed, that Mr. Gallatin had, in conversation, said that 
 the moneyed concerns of the Government could be well managed without 
 this bank.] If Mr. Gallatin has so said, he then says one thing and reports 
 a different thing; and is therefore inconsistent. But I take his official report 
 
ON THE BILL TO RENEW THE CHARTER OP 1791. 
 
 as the best evidence of his opinion: and these men, having been charged with 
 the management of the revenue for many years, and having the knowledge 
 acquired by experience, certainly should know what is necessary and pro- 
 per for the convenient and well management of the affairs of their depart- 
 ment, and are therefore better authorities on the subject than any member of 
 this House. 
 
 As to the remark made by some gentlemen that this is a party question, I 
 have only to observe, that, if federalists do right, that can be no sufficient rea- 
 son for me to do wrong, merely to oppose them; and if the suggestion that 
 this is a party question, is to prevail against reason and common sense, and 
 parties are thereby to be marshalled against each other, under the banners of 
 some leader, then, indeed, any thing mat can say ay or no, is perfectly quali- 
 fied to be a member of this House, and intelligence is laid aside as useless 
 and unnecessary. Against doctrine of this sort Iprotest; and perceiving, as 
 I think I do, great political as well as individual inconvenience and distress 
 awaiting a refusal to renew this charter, which is not compensated by any cor- 
 respondent public good; and perceiving, also, in the destruction of this in- 
 stitution, a want of stability in your institutions, which is a partial verification 
 of the predictions of the enemies of republican government, which we ought 
 to refute by our acts, I shall therefore vote against the indefinite postpone- 
 ment 'of this bill, reserving, however, to myself, the right of subsequently 
 examining the details thereof. 
 
 Mr. W. T. BARRY. Mr. Speaker: The measure now under consideration 
 is certainly important. It involves principles interesting both as they relate 
 to the General and State Governments. The solicitude manifested for the re- 
 ne\yal of the charter; the deep concern that is felt in some of the States; the 
 serious and solemn manner in which this subject has been considered and act- 
 ed upon by their legislative councils; the general agitation it has occasioned 
 in the public mind ; has not failed to command my most serious attention, 
 shou Id , nevertheless, have been content to have left it to the discussion of others, 
 abler and more experienced than myself, satisfied with giving such a vote as 
 would comport with the honest conviction of mv understanding; but the de- 
 bate has taken an unexpected course to-day. The remarks of my colleague, 
 [Mr. M'KEE] will not permit me longer to remain silent As it is my lot to 
 differ with him on this great question, I must claim the indulgence of the 
 House for a few moments, whilst I endeavor, in as concise a manner as possi- 
 ble, to state some of the reasons by which I am actuated. 
 
 The baneful effects to result from the dissolution of the bank; the ruin that 
 is to follow in its train; have been portrayed in the most glowing colors, in a 
 manner calculated, as it was no doubt designed, to awaken and alarm our 
 fears. I shall not now enter upon this branch of the subject. 
 
 If, as I am most seriously impressed, the constitution does not authorize us 
 to pass the bill, there is at once an end of the question. It is, Mr. Speaker, 
 immaterial what consequences may result. No pressure of calamity, however 
 great, can warrant a departure from, or violation of, that sacred instrument. 
 
 It has been said that this is a party question. The remark is just, so far as 
 the principles which separate and distinguish the two great political parties in 
 the United States shall be made to bear upon it; not that the declaration of 
 any man can make it so. It is measures, not men, that should govern. 
 
 It will be recollected that, early in the history of our Government, the coun- 
 try was divided into two great political parties; the one endeavoring to extend 
 and increase the powers of the General Government; the other attached to the 
 State authorities, and exceedingly jealous of their rights. Under this state of 
 things the constitution of the United States was framed. Soon after the Go- 
 vernment went into operation under it, these parties again displayed them- 
 selves in the rules they adopted for expounding the constitution; the one con- 
 tending for that kind of interpretation which would possess Congress with the 
 most ample powers, sufficient to do whatever political expedience might dic- 
 tate in providing for the common defence and general welfare. 
 
212 BANK OF THE UNITED STATES. 
 
 This latitude of construction was considered by the other party as danger- 
 ous; that it would tend to consolidation; that, in this way, State rights would 
 be encroached upon and their sovereignty impaired. They contended that the 
 power of Congress was limited; that it must be confined to those powers ex 
 pressly delegated, and to such as were necessary and proper to carry them in- 
 to execution. That this mode of construction resulted necessarily from the 
 nature of the General Government, but was settled beyond all doubt by that 
 clause in the constitution which provides i4 That all powers not delegated to 
 the United States by the constitution, nor prohibited by it to the States, are re- 
 served to the States or to the People;" that, to step beyond the boundaries thus 
 fixed, would be to enter upon a field of power no longer capable of being de- 
 fined. Such has been my understanding of the views of the two parties; the 
 one called/erfera/, the other republican, or democratic, if you please. I speak 
 of parties as they were at the period I allude to. 
 
 It is remarkable, that, upon this very subject, in the year 1791, when the bank 
 charter was granted, we find the most distinguished politicians of that day 
 who were on the republican side, opposing it: and they did it under the gui- 
 dance of those sentiments that had originally given rise and character to the 
 party. For, although they did not admit the utility; of the banking system, 
 yet the great ground of opposition the strength of their argumentwas direct- 
 ed against the power of Congress to pass such a law. It was, sir, upon that 
 occasion, that Mr. Madison, then a member of Congress, made that perspi- 
 cuous and luminous argument that has been so justly celebrated as defining 
 and marking out the proper limits of power assigned to the General Govern- 
 ment. I have thought proper to make these preliminary; remarks, to show 
 what was the understanding of this measure at the time of its adoption. That 
 it was then protested against as unconstitutional. Two articles of the consti- 
 tution seem to be mostly relied upon by those who are in favor of the renewal. 
 That which gives to Congress the power to lay and collect taxes, duties, im- 
 port?, and excises, to pay the debts and provide for the common defence and 
 general welfare of the United States, or, in other words, the power by which 
 Congress is to regulate the financial concerns of the nation; and that which 
 gives the power to make all laws necessary and proper for carrying into exe- 
 cution the powers vested by the constitution in the Government of the United 
 States. 
 
 It has already been shown by gentlemen who have preceded me, by a 
 course of reasoning, to my mind unanswerable, that the clause which enables 
 Congress to pass all laws necessary and proper to execute the specified powers, 
 must, according to the natural force of the terms and context, be limited to the 
 means necessary to the end, or incident to the nature of the specified powers; 
 that this clause was in fact merely declaratory of what would have resulted by 
 unavoidable implication, as the appropriate, and, as it were* technical, means of 
 executing these powers. It was further contended, that the true exposition 
 of a necessary; mean was, that mean without which the end could not be pro- 
 duced. If this doctrine is correct, it puts the question at rest;as it has been 
 most clearly shown that a bank is not a necessary mean according to this ex- 
 position. I shall not dwell longer on this head, considering it as already ex- 
 hausted by argument. The word " proper" is, in my mind, an important and 
 operative word in this clause of the constitution. The incidental power to be 
 exercised must not only be necessary, but proper; that is, it must be appropri- 
 ate and confined to the end in view. If it goes beyond it, if it involves the ex- 
 ercise of a power that tends to create a distinct and substantive thing, which, in 
 its important operations, is entirely distinct from, and independent of, the pow- 
 er to the execution of which it was designed as a mean, it would most certain- 
 ly be improper. Such an exercise of power would, in truth, be usurpation; and 
 the end proposed becomes a mere pretence for the unwarrantable assumption 
 of power. 
 
 To enable Congress to collect taxes, offices of deposite merely would be suf- 
 ficient. But instead of confining the incidental power to be employed to the 
 object it is designed to accomplish, you introduce a new system of policy, that 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 213 
 
 has no more connexion with the management of the revenue, than it has with 
 the power to borrow money on the credit of the United States; with the power 
 to regulate commerce with foreign nations, among the States, and with the In- 
 dian tribes; or than it has with the power to raise and support armies or to pro- 
 vide and maintain a navy. The power to establish a bank applies equally as 
 an incident to all the abovenamecl powers, and is not strictly appropriate to 
 either, nor is it confined to all of them collectively. If, under such pretence, 
 you can erect corporations, our power in this respect is unbounded. 
 
 By this act, you form a society of individuals, invest them with extensive 
 and exclusive privileges, who, instead ot being employed as auxiliaries in the 
 fiscal arrangements of the Government, set up for themselves, and go on upon 
 a system ot money making. They issue notes that become a circulating me- 
 dium, and forms a new species of capital. The institution carries with it a 
 train of offices, influence, and patronage. It gives rise to an act of sovereign 
 power, that no Government should ever be permitted to, or can derive by just 
 implication, that of punishing those who may counterfeit the notes of this bank. 
 Thus introducing into our code of laws a system of criminal jurisprudence 
 never contemplated by the constitution. 
 
 It will be seen, as we progress in this inquiry, how this measure is calcu- 
 lated to affect the State rights, and to infringe upon their sovereignty. 
 
 If it is good policy to establish banks, and I am inclined to think it tends, 
 when properly regulated, to promote the interest of society, the States will 
 surely have a right to claim the benefits that may result from it; because this 
 right they never have parted from. The profits arising from discounts, the 
 advantage to accrue from public and private deposites, and the many facilities 
 this kind of institution affords to society, belong to the 8tates,and ought to be 
 exclusively under their control. The objects of State policy are infinitely 
 more numerous than those of the General Government, arid deserve equally 
 to be promoted. 
 
 It is said the States are at liberty, if they choose, to establish banks; this 
 does not remove the objection; if the right is impaired, it is the same in prin- 
 ciple as if it was denied. A branch bank of the United States will always 
 have a predominant influence. They will have the benefit of a largo capital; 
 but the great source of influence results from its connexion with the mother 
 bank, and a confederacy of branches co-extensive with the United States. 
 They all move in concert; and, by combining their influence, would, at any 
 time, be enabled to overwhelm and destroy the small State establishments. 
 There can be no stronger evidence of the weakness and the dependence of 
 the State banks upon that of the United States, than the alarm that some of 
 them now feel at its expected dissolution. It is said, that no danger of this 
 sort is to be apprehended; that those who have had the direction of the United 
 States' Bank have conducted it properly, and with liberality. This affords 
 no guarantee that they will continue to do so. Bank directors have the same 
 passions and prejudices that other men have; the same feelings of jealousy and 
 rivalship exist in corporate bodies as with individuals; the same struggle for 
 power and disposition to oppress. State rights require the guardianship of the 
 constitution; they are not, I trust, to be left to the mercy of a bank directory. 
 
 It would, sir, be less objectionable, if the Bank of the United States diffus- 
 ed its benefits equally throughout the different States. But, instead of this 
 equal and just distribution, it will be found to be confined and partial in its 
 operations; its benefits will be principally confined to the sea ports; it can 
 only be made to operate indirectly upon the agriculturist and manufacturer. 
 The direction of this institution will be entirely in the hands of commercial 
 men; all its power and influence will be lent to them. This, combined with 
 the power their wealth naturally gives them, has heretofore, and will continue 
 to give them a decided ascendancy in the councils of this nation. It is be- 
 lieved that this kind of influence has had its effect in producing our existin " 
 embarrassments with foreign nations. Sir, the slightest attention to our put? 
 he acts will show that there has been a great predilection for commerce; that 
 it has met with almost exclusive protection and support; whilst litil or n-- 
 
214 BANK OF THE UNITED STATES. 
 
 thing has been done for the internal industry of the country; large sums of 
 money have been expended for the promotion of commerce, whilst our infant 
 manufactures have been suffered to pine and languish; me enterprise em- 
 barked in this way, never having experienced any kind of encouragement 
 from the General Government. It is time to remove the causes that gave rise 
 to this partial influence. 
 
 I The power of the States is affected by this measure, in another important 
 respect. By its means, individuals, who are mostly foreigner*, hold large es- 
 tates in stock, without being, in any way, subject to the control of the State 
 Government, or paying any tax for its support. Is it just that such exclusive 
 privileges should be conferred? Is it proper that these men, not the most 
 meritorious, should be entirely exempt fromthe burthen of taxation, whilst the 
 true citizen is bound to yield his personal and pecuniary aid? 
 
 Another formidable objection that presents itself, is the connexion of this 
 institution with the Government a dangerous source of influence and power. 
 When the People have to pay taxes for the support of Government, they feel 
 and understand what is going on. If they should be burthened with high 
 taxes, unless a good reason can be assigned for it, they will remove their 
 agents, and appoint others, who will act upon a better system of economy. But 
 give to the Government a bank with a large capital, and you afford a facility 
 of borrowing, and a source of supplies, utterly incompatible with the genius of 
 republican institutions. Loans may be had to enable the Government to pur- 
 sue their projects; expensive establishments may be created, and kept up, in 
 this way, that the people never would have tolerated, had they been directly 
 called on for their contributions. The ease it would afford of getting money, 
 would be the cause of repeated applications to this source; and we may readily 
 perceive how a debt thus created will be constantly accumulating; upon this 
 subject we have the light of experience to guide us. The English nation pre- 
 sents a sad example. It is true, the proposed capital is too small to create 
 much clamor at present; but, renew this charter, and it will be augmented as 
 convenience shall dictate. The capital of the Bank of England was small at 
 its first establishment, but it increased gradually as the exigence of the Go- 
 vernment required. Sir, whenever the Government shall have become largely 
 indebted to this bank, it will have acquired an influence over our counsels, the 
 idea of which is humiliating; an influence that would not only be degrading, 
 but one that would endanger our liberties, by subjecting us to the control of 
 a moneyed aristocracy. Permit me now, sir, to notice a few of the arguments 
 that have been advanced in favor of renewal. It is said, that the practice of 
 this Government is against the rule of construction we contend for: as an ex- 
 ample, the act concerning light houses, beacons, buoys, and public piers, has 
 been cited. This is referred to the power of regulating trade. This act is, 
 in truth, only a mean to carry into execution a power; it is distinguishable at 
 the first glance from the power to establish a bank. They only tend to pro- 
 mote commerce; they are strictly, necessary, and properly confined to the ob- 
 ject. They go no further than the end in view, not at all impairing the rights 
 of individuals, or of the States; besides, there is nothing in them uncongenial 
 with the nature of our Government. 
 
 It is further contended, that the law now attempted to be renewed has been 
 sanctioned by the States, and acquiesced in by the People- That, although it 
 might not originally have been necessary, it has now become so. I can see 
 strong reasons why this act, granting a charter, should not be repealed, al- 
 though unconstitutional. The system had been introduced; a pledge was 
 given to the stockholders; they invested their funds upon the faith of its 
 continuance for twenty years; it was a contract for that period; to have 
 violated the public faith would not, perhaps, have been consistent with 
 sound policy. There is a difference between repealing the law and suf- 
 fering it to expire. The stockholders have not even the color of a claim 
 upon us for the continuance of the charter after the expiration of the 
 twenty years. The contract has been fulfilled and completed. They 
 are, or should have been, ready to close their business- Sir, if this doc- 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 215 
 
 trine of acquiescence is correct, many other obnoxious laws that have been the 
 cause of much heat and ferment throughout the nation, might, in the same 
 way, be proven to be constitutional, andmight, hereafter, be received, for the 
 same reason. It is one of the first principles of a representative government, 
 that a subsequent legislature have the power to change the measures of a pre- 
 ceding one; and it often is necessary they should do so. No State has ever 
 sanctioned this law by a direct declaration to that effect. Their approbation 
 has been inferred from their having passed laws to punish counterfeiters. 
 Sir, the States cannot repeal an act of Congress; they could not prevent the 
 circulation of the notes of this bank. It was, therefore, essential to pass such 
 laws, in order to secure and protect their own citizens from fraud and impo- 
 sition. 
 
 It seems clear to me, that an act of Congress, not originally constitutional, 
 cannot be made so by any lapse of time. If, in 1791, it was unconstitutional, 
 it must be so now. The constitution does not change with the times. A re- 
 publican administration should not be permitted to exercise a power that they 
 would have denied to the other party. The love of power is natural; man is 
 prone to abuse it. I confide much in those who are, at present, at tne helm, 
 but I will not trust them beyond the limits of the constitution. " With unre- 
 mitting vigilance, with undaunted virtue, should a free people watch against 
 the encroachments of power, and remove every pretext for its extension." 
 
 The evils to result from the dissolution of the bank, have, in my opinion, 
 been greatly exaggerated : but, sir, this alarm, if real, impresses my mind 
 differently from what it does that of some others. The deep interest excited; 
 the feelings that have been awakened ; the memorials constantly flowing in 
 upon us; show the important bearing of this institution, and the great interest 
 it has already created. 
 
 If we look forward to a period when this charter is to expire; if ever we 
 intend to shake oft* this illegitimate offspring, now is the lucky moment; its 
 embrace, though strong, is not yet deadly. Although some of its advocates 
 threaten, and endeavor to coerce us into the measure, by the alarm they have 
 excited, the stockholders yet approach in the respectful attitude of momorial- 
 ists; vye are yet at liberty to act freely; but, if this charter is renewed, depend 
 upon it we shall not be able, hereafter, to stop its progress. Pretences will 
 not be wanting to extend its limits, and augment its capital. The poison, al- 
 ready tasted, would soon reach the vitals of this Government; our efforts, 
 hereafter, for relief, will be friutless; they will only serve to irritate and in- 
 flame, until, at length, it will be found that we must tamely submit. 
 
 Mr. FINDLEY. That Congress have a right to refuse the renewal of the 
 charter of the bank, or to modify it as they think proper, is admitted on all 
 sides. He himself wished the bill to be much changed from what it is at pre- 
 sent. He would be even willing to join in rejecting it, for the sake of trying 
 an experiment, if he was not convinced in his own mind, that the experiment 
 would cost too much. We know how far and how well the present bank had 
 answered the intention and the end for which it was instituted; but suppos- 
 ing another national bank to be instituted, which he knew was the wisn of 
 some members who were opposed to the present one, very great both public 
 and private distress must take place in the mean time, without a certainty of 
 being better served in the end. 
 
 Whatever might be said on the ground of expediency, against renewing the 
 charter, he had been much astonished to observe the bill so much opposed, as 
 being contrary to the constitution. When the law for incorporating the bank 
 passed, it was opposed in the House of Representatives by a minority about 
 one third of the members voted against it. Though he was not then a mem- 
 ber, yet he attended to the discussion, and he knew that those that led the 
 opposition were equally opposed to all State banks, of which there were then 
 but three in the United States, and none of these were instituted to promote 
 the regular, permanent, and successful operation of the finances of tne State, 
 as some of them at least have since expressly been. He was sure that the 
 
216 BANK OF THE UNITED STATES. 
 
 Bank of North America, the first that had been incorporated, was, perhaps, 
 from the circumstances of the times, considered rather as injurious than bene- 
 ficial to the State: therefore, that a bank should be useful in conducting the 
 revenues of the United States, was, at that time, in the opinion of many, at 
 least doubtful, or a mere theory; but, no sooner was the experiment fully 
 made, than all parties acquiesced in its constitutionality and usefulness. Its 
 constitutionality has been recognised by all the branches of the General Go- 
 vernment, through all the changes of parties and administrations: this could 
 be made evident by numerous instances. 
 
 It is true, an honorable member from New York (Mr. PORTER) has denied 
 this, and alleged that the reason why it was acquiesced in or not repealed, 
 was, because it was a contract which it was necessary on the part of the Go- 
 vernment to fulfil. 
 
 Mr. F. said, that a contract contrary to the constitution was void in itself, 
 especially where no consideration was given; that our courts of justice, who 
 were judges both under the law and the constitution, would set such contracts 
 aside, much more an act of incorporation, for which no valuable co^sidera- 
 tion had been paid, as the consideration only consisted of the services that 
 were to be rendered, and which, if contrary to the constitution, ought not to 
 be accepted. So far, however, have the courts of justice been from setting 
 this law aside, that both Federal and State courts have, under the authority 
 of both the Federal and State laws, made decisions for its protection. Or, if 
 it had been contrary to the constitution, Congress ought to have repealed the 
 law by which it was granted; there was a precedent to that purpose in this 
 country. The Bank of North America was incorporated by Congress at a 
 period of alarming pecuniary distress; but knowing that it had no authority 
 to give it effect, Congress recommended the incorporation of it to the respec- 
 tive States. Pennsylvania and Delaware only complied with the requisition; 
 the charter gave an exclusive monopoly in perpetuity. Another company, in 
 1784, applied for a charter; the Bank of North America opposed their claim 
 with success, in right of their charter. The succeeding Legislature consider- 
 ed the exclusive right and the perpetuity to have been granted in violation of 
 the constitution, and therefore repealed that charter, and afterwards granted a 
 limited charter to the company. Political parties have changed since the 
 United States' Bank was incorporated; those that now prevail nave been the 
 majority about half the time; yet so far have they been from repealing the 
 charter, that they have extended its powers, and availed themselves of its ac- 
 commodations. It was a mistake to consider the authority to incorporate the 
 bank to be a separate and distinct power, and therefore not granted to Con- 
 gress. It was not even, as some members have called it, a constructive 
 power, or power by implication. It was inseparably included in the powers 
 expressly granted, as the means to accomplish the end; for it is in all cases 
 admitted, that where an object or duty is enjoined, the means of accomplish- 
 ing the object or of performing the duty are included. This is too plain to 
 require proof or illustration. 
 
 The powers vested in Congress, or the duties enjoined, are, to lay and col- 
 lect taxes, duties, imposts, &c. to pay the debts of the United States, &c.; and 
 the object prescribed is the public good and general welfare of the United 
 States; they have also the power to provide for raising and supporting an 
 army and navy, and for borrowing money on the credit ot the United States. 
 
 Surely, no member will say that the safe-keeping, the most cheap and cer- 
 tain manner of collecting the revenues, and the most expeditious and the least 
 expensive manner of transmitting them to the destined places, and paying 
 them to their appropriate uses, are not included in the beforementioned powers; 
 if they are not, the powers themselves are a nullity, because they cannot be ex 
 ecutecl. Custom house bonds are, by law, lodged in the banks for collection. 
 
 It is admitted that these powers included a choice of means and a discre- 
 tion in the application of them, as they did in the various objects of taxation. 
 Congress might have instituted numerous offices of deposite, and paid high 
 salaries, and required sureties equivalent to the risk, and they might have 
 
ON THE BILL TO RENEW THE CHARTER OF 1791, 217 
 
 employed public officers, sufficiently protected, to transmit the money to the 
 various places where it was required, and to pay it to the appropriate uses. 
 To this method, no doubt, nations had resorted before banks were introduced; 
 but, surely, this method would be more unsafe, more uncertain, much more 
 expensive, and attended with much more delay, than the agency of a bank, 
 whose capital gave sufficient security, and whose paper is in great circulation 
 and credit. Therefore, whatever might have been the different opinions, be- 
 fore the experiment was made, yet, having been successfully made, it is evi- 
 tlent that it was the best means to accomplish the end. 
 
 The honorable gentleman from New York, however, has admitted that 
 banks are necessary and proper for collecting, transmitting, and safe keep- 
 ing of the revenue, but alleges that the State banks are sufficient for that pur- 
 pose. Tlii?, Mr. F. said, as he understood it, was giving up, in a great mea- 
 sure, the point If the use of banks was necessary to carry the revenue pow- 
 ers into effect when this charter was given, and when there were not banks 
 south of Philadelphia, and, it is believed, but two east of it, there not being 
 State banks sufficient at the period when the charter in question was granted, 
 in any degree adequate to the purpose, the Bank of the United States was a 
 necessary means or instrument lor executing the revenue powers vested in 
 Congress, and therefore not contrary to the constitution. If, at that time, it 
 was not, then, it may be asked when it became so? 
 
 The State banks are not, by their charters, in any degree responsible to 
 Congress; they are not obliged to inform it of the amount of their capital, or 
 their debt, or paper issued, as of their deposites. Surely, no member would 
 agree to deposite the revenues of the United States with, or transmit them 
 through, institutions, of the solidity of whose credit they were not well in- 
 formed. He did not mean, however, to say, that it was not possible to se- 
 lect such a number of State banks as would be sufficiently safe for deposites, 
 or that such a connexion of these banks might not be formed, as would make 
 them responsible for the safe and speedy transmission of the revenue, and 
 give the necessary information to Congress of the state of their affairs; yet, 
 supposing this was all completed, this union of banks would be in so far a na- 
 tional bank, subject to the same objections, and to the following defects: The 
 rates of all these banks would not puss through the whole of theTJnited States, 
 and the continuance of their charter would be at their discretion, and on the 
 terms prescribed by the respective States. Indeed, it would occasion such a 
 competition between the different States and the United States, in conduct- 
 ing their respective revenues, as might be inconvenient. 
 
 He did not mean to depreciate the State, banks; many of them are worthy 
 of the highest confidence, as far as their power and operations extend; but, 
 surely, it will not be said that all of them are so. The paper of some of them 
 is well known to have depreciated; the paper of many others are current but 
 to a small distance; they will not carry many of the members of this House 
 from their homes to this place; the paper of none of them will pass through- 
 out the United States. 
 
 Mr. F. said, there had been an unusual liberty taken on this Question, of 
 introducing party epithets. He did not really know what that had to do with 
 the question. 'I he parties connected with all banks, are the men that have 
 money to vest in them for their own profit and at their own risk, and those 
 who have credit, on which they receive accommodations from the bank; and 
 there is a third party, who have neither money nor credit, and who have no 
 interest in banks further than the accommodations received from them some- 
 times enable their employers to pay them their wages the more promptly. 
 You may call these parties federalists, republicans, aristocrats, or what you 
 please: but those who have the most money, and are the greatest stockholders, 
 will eventually have the direction of the banks, and those who have the great- 
 est credit will obtain the largest accommodations. We know of some banks, 
 instituted by one political party, which has come under the direction of ano- 
 ther; they purchase the stock in market. We find, indeed, great opposition 
 4o the renewal of the charter of this bank, but not a single charge of miscon- 
 28 
 
218 BANK OF THE UMITED STATES. 
 
 duct, except the alleged appointment of two improper directors in a distant 
 branch. Surely, the bill might be so amended as to give reasonable security 
 against such appointments. He was but little acquainted with the branches, 
 but he had heard no complaint against the direction of the mother bank, and 
 was well assured that the republicans of Philadelphia had as liberal accom- 
 modations, and that as much or more of their paper was discounted there, than 
 in any other bank; which, if the charter is not renewed, they must then 
 redeem. 
 
 Congress is vested with the power of receiving money on loans, and, conse- 
 -~- quently, of providing the best method of procuring loans; and it is univer- 
 sally admitted that banks are the best sources from which to receive loans, 
 without delay, without difficulty, and at moderate interest, and for no longer 
 time than the loan is necessary. In the early stages of our Government, our 
 revenue was small, and our debts and expenses great. In addition to these,, 
 we soon became involved in a tedious, very expensive [ndian war. It con- 
 tinued five years. During this period, numerous loans were made from the 
 bank, till more than three -fifths of the whole capital was loaned to the Go- 
 vernment at common interest, payable at discretion. Another crisis of diffi- 
 culty and expense arrived, viz. hostilities with France. Money was wanted; 
 the bank could advance no more, it had already loaned too much. The Go- 
 vernment was obliged to open books fo? a loan at eight per cent, interest, ir- 
 redeemable frr ten years; but few years had passed before money could have 
 been borrowed at a reduced interest for its discharge. Nay, but a few years 
 had passed till it could have been discharged at the treasury, if it had been 
 redeemable; much of it, as well as bank and other stock, was sold to pur- 
 chasers in Britain and Holland. 
 
 It is believed by many, that a loan might be made to a large amount now, on 
 .* better terms; but when he considered the great drain of specie from the coun- 
 try during the last year, the losses in Europe, and the unusually small amount 
 of specie imported, or that was in the vaults of the different banks^he thought 
 there was little encouragement to try the experiment. Such loans must be of 
 a money that would pass throughout the United States for all payments. 
 
 Mr. F. said, that, having entered more largely, on a former occasion, into 
 this question, he did not intend to detain the House now. He had, as much 
 as he could, avoided repeating what he had said formerly, or what others on 
 the same side of the question had expressed. He had, therefore, avoided 
 mentioning the public and private distress that must result from the immedi- 
 ate dissolution of this bank. Even admitting that the specie stock purchased 
 by foreigners, believed ta amount to 87,000,000, should not be immediately 
 removed from the country, yet it would be diverted from its accustometl 
 uses; and, instead of giving relief as at present, might speculate upon our dis- 
 tresses. He believed that suddenly calling $15.000,000 of current medium 
 out of the usual circulation, could not avoid, in any country, being the cause 
 of at least a great proportion of public and private distress. Therefore, he 
 could riot, by his vote, support the measure. It will have other iriconvemen- 
 cies, which have not been mentioned. When the bank winds up its busi- 
 ness and makes a transfer to trustees, it is not, by charter, obliged to call in 
 its notes from a circulation that is widely extended throughout the United 
 States. The holders, indeed, will have their remedy at law against the trust, 
 but this may be a tedious and inconvenient remedy for many note holders. 
 
 It has been asserted by more than one member, that the institution of the 
 bank was the foundation or source of the party spirit that has unhappily pre- 
 vailed in this country. He wished, before he sat down, to correct this mis- 
 take, passing what prevailed before the Government took place. It was the 
 funding system, in the mariner it was conducted, and the extent to which it 
 was carried, and the consequent speculations, that was the source of that un- 
 happy party spirit; but, especially, the assumptions of the State debts before 
 they were liquidated or the amount known, and which, after having been once- 
 rejected, was carried by a very small majority; as a fund for this debt, the excise 
 and other unpopular internal taxes became necessary- It is well known that 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 219 
 
 about $3,500,000 of this assumption is yet due to the United States from the 
 States that were paid that much more than enough, and which no method has 
 been, nor probably can be, found to recover. Unfortunately, almost every 
 session, some measures are so conducted as to keep alive, if not promote that 
 ruinous party spirit by which our national character is degraded, and our 
 measures embarrassed. He questioned much if rejecting the bill, without, even 
 attempting to amend it, is calculated to allay that unhappy party spirit. 
 
 JANUARY 22, 1811. 
 The motion for indefinite postponement under consideration 
 
 Mr. Mc'Km spoke in favor of it; Mr. GOLD against it; Mr- JOHNSON for 
 it; and Mr. SHEFFEI closed the debate for the day, in a speech against the 
 motion. 
 
 Mr. Mc'KiM. Mr. Speaker: The subject now under discussion involves an 
 important constitutional principle, which presents, to my mind, an insupera- 
 ble objection to the passage of the bill. It is not, however, my intention to 
 enter on it diccussion of the constitutional principle which has a bearing on 
 the bill. That part of the subject has been ably and critically discussed by 
 my honorable friend from New York, (Mr. PORTER) and by other gentlemen, 
 who have spoken on the same side of the question. On this part of the sub- 
 ject, sir, I will only observe, that a former Congress having decided the con- 
 stitutional question/or themselves, by passing; the law to incorporate the bank; 
 the tribunals of the nation having sanctioned it, as it respected themselves; or 
 the several States having, without rebellion, but not without mnnnuring and 
 'inplainf, acquiesced in such decision, cannot quiet my conscience, nor sat- 
 isfy my mind on the subject. The question now recurs; I have to act on it, 
 and I must decide it for myself. 
 
 I will now endeavor, Mr. Speaker, to submit to the House a few desultory 
 observations, which have for their object to explain some of the practical 
 operations of the banking business; to shew the probable effect of the dissolu- 
 tion of the bank charter: and to answer some objections which have been 
 1 against, its being suffered to expire. 
 
 It has been urged as a motive for the renewal of the charter, that the con- 
 cerns of the bank have been conducted with impartiality to persons of differ- 
 ent political opinions. In answer to this, I beg leave to read a part of a speech, 
 said to be delivered on the floor of this I louse, and reported in one of our pub- 
 lic papers: and also a letter from a gentleman in Baltimore, to whom the 
 speecn alluded. " It had been asserted (says this speech) during the last 
 winter, that the branch bank in Baltimore had accommodated only one par- 
 ticular class of political gentlemen. He (Mr. STANLKY) had it from good 
 authority, that a distinguished republican house in Baltimore, of which a 
 member of the Senate was partner, had obtained a greater portion of discounts 
 than any other merchants in that place.'" 
 
 The letter to which I alluded, is in the following words: "Dear Sir: Will 
 you have the justice to state to the House of Representatives, as early as 
 you have an opportunity, and in direct contradiction of the unfounded asser- 
 tion contained in the enclosed, that the republican house in Baltimore, of 
 which a member of the Senate is partner, has received but two discounts from 
 the branch bank of Baltimore, to wit: one of nineteen hundred and sixteen 
 dollars and fifty-five cents, and one of eighteen hundred dollars; the first on 
 the 14th of April, and the second on the 14th of May, 1798; although the 
 transactions of the House with that bank amount to nine hundred and thirty- 
 six thousand three hundred and twenty-two dollars fifty cents." 
 
 [Here Mr. STANLEY explained. Perhaps it had not been his good fortune 
 to be understood in the remarks which he presumed were alluded to by Mr. 
 M's correspondent. It was his meaning, if not his words, that, although par- 
 tiality had been charged in the distribution of the favors of the branch bank 
 
220 BANK OF THE UNITED STATES. 
 
 of Baltimore, he had been informed, from good authority, that, of its discounts* 
 more than one half had been obtained by gentlemen of politics opposite to 
 those of the bank; and that, in the purchase of bills of exchange, this bank had 
 purchased a larger amount from the house alluded to (Smith and Buchanan) 
 than from any other house in Baltimore.] 
 
 I am satisfied, said Mr. M. with the explanation. I have not introduced 
 the speech and letter so much to support my argument, as to do justice to my 
 friend; nor can I vouch for the correctness of the report. 
 
 It has been stated that nineteen or twenty millions of dollars are due to 
 this bank, whose charter is now about to expire; that, if the charter is not re- 
 newed, it will produce great distress, ana general bankruptcy will ensue; 
 that the bank, in winding up its concerns, can receive nothing but specie, 
 which will exhaust the resources of the other banks and individuals, and there- 
 by produce a result the most disastrous to the mercantile interests of the 
 nation. This statement is incorrect. By the returns from the treasury, it 
 appears that no more than $1,318,024 was due to the bank: and that the bank 
 is indebted to the public and to individuals, in the sum of $11,542,320; and 
 all the offsets it had, against the heavy debt, are the above sum, due from 
 different State banks, of $1,318,024, 
 
 Mr. M. illustrated this position by the following detailed statement of the 
 account, which he read in his place: 
 
 The bank owes to Government for deposites, - $2,493,362 
 
 It owes to individuals for deposites, - 3,891,680 
 
 It owes for its notes in circulation, - 5,157,378 
 
 Total amount of its debts, - - 11,542,320 
 
 Deduct from the amount of debts due by the bank, its only offset, 1,318,024 
 
 Leaving a nett balance of debts due from the bank, of - - 10,240,296 
 
 This, sir, is the present situation of the expiring bank, by its own showing. 
 
 Gentlemen have involved this subject in obscurity, by supposing the fifteen 
 millions of dollars, held by the bank in discounted notes, as a debt due to the 
 bank. Sir, there is not one cent of these notes due except a small sum that 
 is in suit. If these notes were really due, it would materially change the 
 state of the account. It would then possess the means of spreading terror* 
 if it was disposed unnecessarily so to do; but we must take the account as it 
 is; and if we would know how it stands, at any particular time, we must 
 udge of it as we do of a rftce, by viewing both sides at the same point of time. 
 udging in this way, we find that this bank notv owes a nett balance of up- 
 wards of ten millions of dollars. 
 
 Now, sir, I would ask. Can any gentleman believe that it will be in the power 
 of a bank, thus heavily indebted, far beyond the extent of its present means, 
 to spread such terror, and produce such distress, as has been stated, when it 
 is deprived of the public and private deposites, of which it will be deprived, 
 when it is known that the charter will not be renewed? It is true, that, while 
 these funds, the debts it owes, and a continuance of the public deposites, are 
 suffered to remain in its possession, it may do much to create distress; while 
 these funds are in its hands, it can employ the whale pecuniary resources of 
 the nation to coerce other banks and individuals into its measures, if it were 
 so disposed. 
 
 I wish it to be clearly understood, that I do not mean to say, or to insi- 
 nuate, that this bank had unnecessarily used coercion, to create distress, or 
 to obtain the object of its wish a renewal of its charter. But. while these funds 
 remain in its hands, they produce this effect. They render it a measure of 
 prudence and necessary precaution in other banks, not to issue their paper, to 
 aid the customers of this bank, or others indebted to it, to retire their notes; 
 and this operates powerfully on my mind, as a reason for urging a speedy de- 
 cision of the question. I am of opinion, if this question is settled, let it be 
 determined as it may^ that all the difficulty and distress resulting from the 
 
 j 
 J 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 probable dissolution of the charter, will soon be dissipated, and things resume 
 their usual course. It" the charter is not renewed, the expiring bank will lose 
 its power of holding other banks in check, by the withdrawing of public and 
 private depusites; which, being placed in other banks, will increase their 
 means of giving aid to those wlib nave paper to retire from the expiring bank. 
 This bank having now no other than its own natural means, will no longer be 
 an object of -dread to other similar institutions; they may now freely lend 
 their aid to relieve the distressed, and iheir increased means will be adequate 
 to the object. 
 
 It has been suggested, that the capital of this bank, owned in Europe, will 
 be remitted in specie, if the charter is suffered to expire; and that such a 
 drain of specie would be severely felt by the banks, at this distressing time, 
 in our commercial concerns. There is no necessity for remitting this capital 
 in specie; and I do not believe one dollar would be so remitted, because it 
 will not be the interest of the proprietors that it should. Exchange is low; 
 I believe bills might be purchased at 7.4 a 10 per cent, below par; and if re- 
 mitted in specie, the freight and insurance could not be less than 5 per cent. 
 A remittance in specie would then be 12.4 a 15 per cent, less favorable than 
 to remit in bills. Men are usually governed by their interest, in transactions 
 of this kind; and I do believe that the managers of this stock, if it is to be 
 remitted to Europe, would remit it as other gentlemen do, in bills. But if it 
 must be remitted in specie, it is probable there is some unknown cause, ope- 
 rating on remittances generally, that gives an advantage to remittances in 
 specie; and if this be the case, the whole amount of our imports from Europe 
 will probably be thus remitted. The amount of our imports from Europe, 
 annually, is probably not less than eighty millions of dollars; and if specie 
 must be shipped olt', to pay for these iinports, it will not add much to our dis- 
 tress, to let the bank capital go with it; but, I am of opinion,j| that one dollar 
 will not be shipped to pay this stock. 
 
 It has been stated by my honorable colleague, (Mr. KEY) whom I do not 
 now see in his place, (and 1 regret tliat I do not, that I might be corrected if 
 I misstated what he said) that fourteen millions of dollars would be thrown 
 out of circulation, if the charter of this bank was suffered to expire; that the 
 bank discounted fourteen millions of dollars; and therefore must have issued 
 its notes to that amount, in payment for the discounted paper. This is incor- 
 rect; one halt of the discounted paper, it might be fairly estimated, was of 
 what is denominated accommodation notes; and for this portion of the dis- 
 counted paper, no money g >es out of the bank after the first renewal; but, on 
 the contrary, money is brought into bank in this part of the business, to pay 
 the interest, or discount, on these notes. I beg leave to explain to the House 
 the nature of what is termed accommodation notes. They are notes for which 
 no value has passed; they are given by the maker of the note, to accommodate 
 the receiver of it, on an understanding between them, that, when due, it will 
 be taken up by the person who received it; and discounts on this kind of 
 paper are in the nature of a permanent loan, so long as the person accommo- 
 dated requires, or as it may be convenient for the bank to continue it, the 
 note being renewed every sixty days, and the interest paid thereon. But. the 
 proposition is equally incorrect, as it relates to the notes dircounted, which 
 were given on some actual transaction in business; notes are not issued by the 
 bank, to the amount of the real paper it discounts; money is constantly com- 
 ing in for notes that fall due; anJ in the course of trade, it frequently happens 
 that the money paid, in one 'week, on discounted notes, is, the next week, 
 by various ivindings and changes, again in bank, to discount nearly a like 
 amount. 
 
 The real diminution of the circulating medium, that will result from the 
 dissolution of the charter, will be Jive inilliom of dollars. The report from 
 the treasury, laid on our tables, states that the bank has five millions of dol- 
 lars of its notes in circulation, and these of course will be paid oft* and des- 
 troyed, when the bank ceases to act; and, as it will then receive no more de- 
 posites, the means of other banks will be enlarged; whereby they may issuo 
 
BANK OF THE UNITED STATES. 
 
 an increased amount ot notes, perhaps nearly equal to the extent of the dimi- 
 nution that will result from the decease of the charter. 
 
 I will repeat, sir, what I before said. When the question of the charter is 
 settled, the difficulties and distress that now exist will soon cease, and an 
 accommodating disposition will take place; the expiring bank will then relin- 
 quish its pretensions to receive nothing but specie in payment; it will see the 
 necessity of receiving payment in the paper of other banks that are in credit; 
 it will receive payment in such bills as other banks and individuals receive 
 freely. And why will it do this, when it has a right to insist on specie? Because 
 it will be urged to do so, from interest and ^necessity. It has a large debt, 
 that will be shortly falling due from its customers, and how will they be able 
 to pay, il the bank shall draw all the specie into its vaults, and keep other 
 banks in check, so that they can afford no aid to its customers, to retire their 
 notes when they fall due. The specie cannot be wanted by the expiring 
 bank. Every object of winding up, remitting, arid paying its capital, can be 
 managed to equal advantage without it. And will this bank, without a motive, 
 and in opposition to its own interest, endeavor to produce distress, by thus 
 unnecessarily drawing the specie into its vaults? Certainly it will not. But, 
 if it should act so unadvisedly, who is to be the greatest sufferer? Who has 
 a greater interest than itself, in facilitating the payment of debts? None have 
 a greater stake at hazard than this bank; and I venture to say, that none will 
 be more disposed to promote the general convenience and prosperity, than it 
 will be. I have no fears of this spectre of misery and distress, that has been 
 artfully conjured up, to alarm us into a renewal of the charter. 
 
 My honorable colleague (Mr. KEY) has made an eloquent display of the 
 benefits of banking establishments, in our agricultural improvements, our 
 manufactures, and ship building; and if this bank was put down, the effects 
 would be severely felt, in the reduced price of produce, and in our improve- 
 ments generally. 
 
 I accord most heartily with the honorable gentleman, asto>the benefit of 
 banks, to a reasonable extent. No one is more perfectly convinced of the 
 benefits resulting from them than myself; but I deny that such injurious 
 effects would be produced, by suffering this charter to expire. Is there no 
 other bank but this one, founded on foreign capital and administered, more 
 or less, under foreign influence, that can produce and perpetuate these be- 
 nefits? Surely there are others as capable, and as much to be relied on, as this. 
 The capital of this bank forms but a small portion of the aggregate bank capi- 
 tal of the nation; and if its charter should expire, the benefits mentioned will 
 not be lost. No specie will be destroyed, or sent out of the country, by its 
 dissolution. Specie is the basis of bank capital; and if we have specie to 
 meet them, we can easily make bank notes enough, without the aid of this 
 bank. The bank notes that will be thrown out of circulation, are all that 
 will be lost by the dissolution of the charter; and if we have specie, we can 
 soon supply their place; there is no scarcity of paper among us. 
 
 The charter of this bank was gran ted for a limited time; the privileges and 
 immunities it granted were great. The interest it yielded on its capital and 
 its credit, are liberal; and the increased value the charter gave to its stock was 
 great. This stock, originally only ten millions of dollars, soon became worth 
 fourteen millions under the charter. The company have enjoyed these bene- 
 fits in the fullest extent, without molestation; their chartered rights have not 
 been infringed or violated; and the charter is now about to expire by its own 
 limitation. And this valuable inheritance of benefits, about to descend, 
 with the death of the charter, to the People of the United States, will be- 
 come their joint property. About seven tenths of the present stockholders 
 are foreigners; and shall we, the guardians of the rights and interests of the 
 American People, perpetuate these benefits to foreigners, by a renewal of the 
 charter to them, in preference to those whose interests we have been chosen 
 to protect? Persons unconnected with the public business, might, perhaps, 
 wink at such an act; but if we, in our representative capacity, should do it, 
 will it not be to record our infamy? 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. V 223 
 
 Under these impressions, Mr. Speaker, I am prepared to give my vote for 
 an indefinite postponement of the bill. But, if the section stricken out in 
 Committee of the Whole shall be reinstated, and the bill shall come to a final 
 vote, I must record my name against its passage. 
 
 Mr. GOLD. Mr. Speaker: Although this question has long engrossed the 
 consideration of the House, I must ask the indulgence of the House to the 
 observations I may offer; I will not trespass on your patience. 
 
 The question of expediency, together with various extrinsic topics, I pass 
 by unnoticed ; on these, let the judgment, and not the feelings, ol the House, 
 which have been so much addressed through ex parte statements and sugges- 
 tions, determine. 
 
 On the great constitutional question, involved by the bill on your table, it 
 is the fruit of my best reflections, it is my deep conviction, that the agency 
 of a bank is necessary to the administration of the finances of this country; 
 that it is eminently necessary to the great exigencies of war. Tins is the 
 test; on this pivot rests the question. In coining to the conclusion I have, 
 sir, I disclaim the doctrine of implication of powers; of constructive powers; 
 now rendered so odious and so unjustly imputed to those who maintain the 
 constitutionality of this bank. I ask only the application of a plain simple 
 rule, which is as old as first principles: as extended in its operation as the 
 empire of law: to be found in all codes, applicable to all instruments, as well 
 to conventions between Slates as to the contracts of individuals. 
 
 It is, that, with the cm/ is f/n/i, inseparably given, lite means; that, with 
 the express powers gi ve n to this Government is also given the means necessary 
 to carry the Government into sui'ce>sf ul operation; not merely to move the 
 wheels, but to give an effectual 'un]>ul*>\ nece.-siry to the exigencies of the 
 country. When gentlemen survey the extended Department of the Treasury, 
 the wide theatre of the public expenditure, commensurate with the United 
 States; the daily transmission of moneys (to satisfy the -public demand) in 
 every direction, to the furthest limits of the Union; to the frontiers; to your 
 garrisons; to places with which there is no commerce, on which bills of 
 exchange cannot be obtained; can they avoid seeing the treasury involved in 
 the utmost embarrassment by withdrawing the aid of a banking institution? 
 Such embarrassment to my mind is inevitable. 
 
 But, sir, if doubts could exist as applicable to a state of peace, in the great 
 and trying emergencies of war, there is not, 1 did hope, room for diversity of 
 opinion; the necessity of the institution in my conception is eminent, is indis- 
 pensable. Money is the sinew* of war; for want of it, to satisfy a needy dis- 
 contented army, the most important operations of a campaign have been 
 arrested, and the most disastrous iv.-ults produced. 
 
 Our own country, sir; the patriotic army of the Revolution and one more 
 patriotic, I fear, we shall never see furnished one, if not more, instances of 
 discontent and actual mutiny for want of pay (for want of that which this 
 institution could so promptly furnish) which was not appeased without resort 
 to military execution. 
 
 However pacific in its policy, let no nation promise itself continued exemp- 
 tion from war; history gives no assurances of this kind; nowise Government, 
 in its policy and institutions, ever lost sight of a state of war. In case of 
 internal dissensions; in public convulsions, the prompt aid of a bank may be 
 equally necessary. It is the observation of a distinguished writer who had 
 well considered the events of the Revolution, that the independence of this 
 country was in no small degree indebted to the Bank of North America. 
 
 But it is said, that the best resort of Government is to the purse of indi- 
 viduals; that this source will be found abundant. It is, Mr. Speaker, on 
 public emergencies; in times of public convulsion: under the severe pressure 
 of war, when ready supplies of money become indispensable to Government; 
 and it is at such a period that alarms spread and distrust seizes on the com- 
 munity; it is then that the moneyed man withdraws himself, places his cash in 
 a strong box, and not unfrequently commits it to the earth, beyond the reach 
 
224 BANK OF THE UNITED STATES. 
 
 of Government. We have no power of drawing the Jew's teeth; no resource 
 in & forced loan. 
 
 In the course of debate on this bill, it is not a little amusing to observe the 
 desperate efforts, the contradictions and inconsistencies, which gentlemen, in 
 their zeal, fall into. At one moment it is most strenuously insisted that no- 
 thing short of an express provision in the constitution to create corporations 
 can warrant the establishment of a bank; the next moment it is admitted, and 
 strange indeed had it been denied, that, if a bank be a necessary mean for the 
 execution of the delegated powers of the Government, then must it be consti- 
 tutional. 
 
 The most fruitful source of error, Mr. Speaker, is in the palpable misinter- 
 pretation of the term " necessary," in the constitution; it has been reiterated, 
 again and again, under this head of the argument, thata???erm,/o be necessary, 
 must be absolutely, indispensably so, without which the operations of the 
 Government would be arrested. Now, sir, all this is contrary to the sense 
 in which that adjective is used by the most approved writers, and in direct 
 violation of the elementary principles of our language. If gentlemen will 
 take the trouble, and I invite them to do it, to recur to the best writers and 
 philologists, they^will find the term used in a .sense implying only what is 
 needful or requisite, and not what is extremely so or indispensable; and why, 
 sir, should it be extended beyond the above limits? Is it not an adjective of 
 comparison^ for the argument has carried us back to our schools. Is it not 
 in every day's use, and correctly so, that one thing is necessary, another more 
 so, and a third indispenably sop Have we not seen here, upon this floor, a 
 member rise and call for the order of the day on a bill as necessary to be acted 
 on, another member call for one more necessary, and a third for one absolute- 
 ly or indispensably necessary? And yet, sir, gentlemen continue to urge 
 upon us, that necessary, in its positive, uncompared state, imports the 
 superlative, and means indispensable. Such arguments, sir, not only pros- 
 trate the bank, but subvert the very foundation of language. Again, 
 sir, it is said, that no mean is given by the constitution, if the opera- 
 tions of Government can possibly be carried on without it. Is this 
 dishonor to be done, sir, to the memories of those wise men who framed 
 our excellent constitution? Was it the height of their ambition, the fruit 
 of all their labors, to give the country a limping, hailing Government, 
 to move with a snaWspace; to give to the wheels an impulse the least possi- 
 ble competent to move them? Upon this argument, sir, the Government itself 
 ought not to have been established at all, as, without it, the country might 
 have subsisted; we might probably have defended our territory and retained 
 our liberties, at least, lor a considerable period; we might have moved up and 
 down, and consumed the acorns of our forests. A higher ambition moved the 
 worthies who laid the foundations of this goodly fabric of Government; and 
 I will not hesitate to honor them so much as to say, that they intended to give 
 to the Union a Government for attaining the highest degree of political pros- 
 perity, which the condition of the States and the nature of a federative com- 
 pact is susceptible of. Such, sir, in my apprehension, was the object of the 
 constitution; and I beg leave to add, that this object may be carried into effect, 
 without touching the rights, the interests, or happiness of those States. Nay, 
 sir, the best interests of each and every State in the Union imperiously de- 
 mands of Congress, in despite of all the covert movements of State banks 
 and State politicians, independently, to carry into effect the bill on your table. 
 Let us not, sir, shut our eyes to the quarter from whence danger threatens to 
 the interests and ambition of States, who, assuming a control or influence 
 over the Representatives of the People, would, in effect, dictate to you what 
 course you are to pursue. Here, sir, at this period, lies the danger to the con- 
 stitution. We are arrived at a crisis, when it is considered almost an act of 
 hardihood to vote, on this question, in opposition to the wishes of the State to 
 which a member may belong, signified by a resolution of the Legislature. If 
 this influence, sir, is to prevail.over the councils of the Union, then, indeed, 
 are we degraded, our sovereignty lost, and all the weaknesses and maladies of 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 225 
 
 the old confederation returned again upon this body politic. I repeat, sir, if 
 this bank shall fall, it will owe its fate to the baneful influence of individual 
 States, governed by their own banking interests, over the counsels of the 
 Union. 
 
 The argument, sir, in support of the constitutionality of a banking institution, 
 as a mean necessary to execute the Government, is greatly strengthened by 
 the consideration, that the jurisdiction of the Government over the specified 
 subjects of its cognizance is sovereign. 
 
 In the division of power, certain subjects of legislation remain with tho 
 individual States for their sole and sovereign jurisdiction: other specific sub- 
 jects are, by the constitution, committed to the exclusive cognizance of the 
 Government of the Union; all Legislative power over those subjects is notonly 
 given to Congress, but expressly denied to the States. With these plain land- 
 marks before him, I was not a little surprised to hear my honorable colleague 
 (Mr. PORTER,) in a speech of so much method and ingenuity, contend, that 
 the Government of the Union was not sovereign in any thing; that sove- 
 reignty was to be found alone with the People. To the People, sir, we always 
 bow with respect; it is among first principles, that all power flows from the 
 People, and is to be exercised for their benefit arid welfare; the People are the 
 legitimate source of all power, and it is from them the constitution is derived; 
 but, sir, the moment the constitution is formed, and the government establish- 
 ed, the original sovereign power of the People is parted with; it is transferred 
 to the Government, and all interference with its exercise is lost, except through 
 the medium of elections. Need I refer to a host of writers on civil society 
 and Government for all this? The result is inevitable, that the power of this 
 Government over the objects specifically and exclusively committed to its ju- 
 risdiction, is full, entire, and sovereign. The principle of my colleague would 
 give us a government of men, not oi' laws, the very definition of despotism. 
 This view, sir, repels the strict, the narrow, meagre rules of interpretation 
 which have been applied on this occasion. Another position of my colleague 
 is equally unfounded. He insists that the Governments of the Union and the 
 respective States have a mixed or combined jurisdiction over the same subject 
 matter; and hence a new restriction is created on the power of Congress. 
 What, sir, is the power given to Congress, and the means to execute it reserv- 
 ca to the States? for such is the application and consequence of the argu- 
 ment. 
 
 The very face of this proposition involves contradiction and inconsistency; 
 it would make the constitution a felo de se, and annihilate the Government. 
 We are carried back again into Egypt; to the old doctrine of dependence arid 
 requisition of the confederation upon the States. Such, sir, is the extent, such 
 the desperate efforts of argument to cut down the powers of this Government 
 and prostrate this institution. 
 
 I cannot, sir, pass over another argument against the bill, without notice. 
 It is said that the banks of the States may be resorted to in the administration 
 of the finances. Here, sir, by this argument, the whole question of constitu- 
 tionality is given up, for the very necessity of the resort to State banks main- 
 tains the agency of a bank as necessary in administrating the Government; 
 *t -is on ) this pivot, necessity, that the whole question turns. In steering clear 
 of Scylla the argument is lost in Chaiybdis. This necessity of bank agency 
 is so indispensable to the Government, that gentlemen look with fear and trem- 
 bling upon the intermission of a day between the expiration of the charter of 
 the present bank and the new and gladdening reign of State banks. It has 
 been stated on the floor of the House, that arrangements are already making 
 with State banks for the accommodation of the Government. Preparations are 
 in forwardness for celebrating the nuptials of these State-damsels, who, with 
 little modesty, attend in the anti-chamber, eager to rush into the arms of pa- 
 tronage in the treasury. Do ye not discern the signs of the times? Are the 
 policy, the co-operation, and active movements, of the State banks, not seen? 
 VY hilethe tinted States' Bank is going down, do you not observe the wreckers 
 hovering on the coast? 
 29 
 
BANK OF THE UNITED STATES. 
 
 But, sir, this great question of constitutionality does not depend on the oc* 
 casional existence or non-existence of banks, in the States, but on the intrinsic 
 power given by the constitution, without regard to the extrinsic, contingent, 
 and uncertain co-operation of State Legislatures. 
 
 What the future policy of the respective States would be; whether State 
 banks would be established, able and willing to aid this Government, and safe 
 depositories for the revenue, could not be foreseen by the framers of the con- 
 stitution. Such an argument, resting on snch contingencies, would at one pe- 
 riod make a thing constitutional, which at another would be unconstitutional. 
 
 To all those who are averse to a multiplication of banks and bank-stock, 
 permit me to observe, that the States stand ready to fill up, by new banks, the 
 vacuum or space left on the expiration of the United States' Bank, as rapidly 
 as the motion of fluids under the principles of hydraulics? nay ? sir, some have 
 already anticipated the event by a litter of banks, and hence, sir, we have wit- 
 nessed the struggle of a parent's affection to protect its offspring. 
 
 It only remains, sir, for me to call the attention of the House to the past. 
 
 It is now twenty years that this bank has been in operation, in constant in- 
 tercourse and correspondence with the Government under all the revolutions 
 of parties; during which period we have the concurring testimony of all the 
 States in the Union in support of its legitimacy, cleducible from their acqui- 
 escence and satisfaction; for, sir, after the agitation excited by its creation 
 had subsided, I have not been able to find, among all the projects for amend- 
 ing the constitution, that a single State has touched the power that created this 
 bank. No, sir, this viper in our bosom (to use the impassioned language of 
 gentlemen in opposition to this bill) has lain harmless. Harmless, did I say? 
 Like a good genius, it has administered to our wants, and promoted our 
 welfare. 
 
 Can the candid mind resist the conclusion, that the People are with the bank? 
 Shall I remind you, sir, that this institution received its existence from the 
 hands of the greatest and best of men, and under the presidency and with the 
 entire approbation of Washington; that the constitutional question was decid- 
 ed at a period auspicious to fair inquiry? at a period when party spirit was- 
 much less virulent and destructive? that some of the most distinguished sup- 
 porters of the present administration concurred jn its establishment? Shall 
 this question of constitutionality never be at rest? 
 
 Mr. JOHNSON. Mr. Speaker: I had determined, until yesterday, to be 
 silent on this occasion, and I extremely regret the necessity which has com- 
 pelled me to trespass upon the exhausted patience of the House upon an almost 
 exhausted subject. I am opposed to the renewal of the charter of the Bank of 
 the United States from the strongest sense of duty which can be felt by the 
 representative of a free People;! believe it palpably unconstitutional to renew 
 the charter, and, if it were constitutional, it is inexpedient and improper. 
 
 It is absolutely necessary that the House and this nation should understand 
 the real question before us: for arguments have been advanced upon premises 
 which do not exist, and remarks predicated upon a case which is not embraced 
 by the bill. This makes it my duty to call attention to the real question, 
 that we may not dwell longer upon supposed cases. This is not a struggle,, 
 on our part, to repeal any act ot incorporation, or to deprive any citizen of 
 any vested rights claimed either by nature or by any political act; but an ex- 
 ertion in favor of equal laws and equal justice to all the People of the United 
 States, to prevent monopolies from being given to a moneyed aristocracy, 
 unknown to the constitution, and dangerous to the liberties ot the People, and 
 subversive of the State sovereignties. Twenty years ago, Congress, in express 
 violation of the constitution, incorporated a bank, called the Bank of the 
 United States, to continue twenty years, which will expire the 3d of March. 
 It was granted by those principally who have assumed the name of federalists, 
 and who advocated the incorporation of the bank as constitutional, upon the 
 odious doctrine of implied powers, and which was opposed by those who have 
 since supported the character of republicans; this very measure was the first 
 
ON THE IHLL TO RENEW THE CHARTER OF 1791. 227 
 
 that laid the foundation for the two great political parties who have, since that 
 period, agitated and divided this country. The charter granted in 1791 will 
 expire the 3d of March, and the stockholders, and those under their in- 
 fluence, have petitioned Congress to renew the charter for the term of twenty 
 years more. Will we encourage this moneyed aristocracy, and continue this 
 privileged order in the bosom of our country twenty years longer? They have 
 nad the exclusive advantage of accumulating wealth and 'money for twenty 
 years, and they are not satisfied. They wish a renewal of their charter for 
 twenty years to come. Thus, sir, the present Congress have before them the 
 same question which was determined in 1791, viz. to incorporate the stock- 
 holders of the United States' Bank twenty years from the 3d of next March. 
 We are absolved from all obligations on this subject, but those of duty to the 
 People: the question stands on its original merits and demerits: for the lapse 
 of twenty years cannot sanctify a breach in the constitution, nor the acquies- 
 cence of the People make that expedient and proper, which is hostile to liber- 
 ty, equality, and justice; thus absolved from all obligations to promote this 
 institution, from such considerations as have been urged, I am to consult the 
 goood of the People. 
 
 First, to incorporate the stockholders of this bank, and thereby continue in 
 existence a moneyed aristocracy, and a privileged order of men, is a violation 
 of the constitution of the United States; that constitution of union which binds 
 the States together, and which we are individually bound to support by a 
 solemn appeal to heaven. 
 
 It cannot be unpleasant to trace back to its source the union of the States. 
 It brings to the patriot's mind the events of the American Revolution. It was 
 in this glorious Revolution that the union of the States had its origin; at a time 
 when we were distracted by domestic faction, and threatened with a foreign 
 power, when, in fact we were invaded by a British army, and our political 
 existence was threatened. Thus, while General Washington was at the head 
 of our forces in the North, the sages in Congress were planning articles of 
 confederation as early as June, 1776. Before the declaration of independence, 
 a committee, composed of a member from each State, was appointed, to draw 
 up articles of confederation by which the States should be bound to each 
 other. 
 
 These articles of confederation were finally adopted by all the States in 
 1781, until which time Congress was the type of union, and the rallying 
 point for the States. So great was the influence of these men who conducted 
 us safe through the Revolution. This summary will give us the objects of the 
 union of the States. It was not for the purpose of interfering with State 
 rights, for the purpose of regulating the laws of credence, ana the laws of 
 descents, of creating county court-houses and jails, opening State and county 
 roads; this would have been impossible; it would have been an assumption of 
 power destructive to every principle of independence. It was, on the other 
 hand, for the great and mighty objects of common security from foreign ene- 
 mies and domestic treason and insurrection, that the union was formed. The 
 objects of the union are confined to those great matters of the confederacy 
 which could not be effected by a single State. We should, therefore, confine 
 ourselves to these objects of the confederacy, that we may not weaken the 
 bonds of union by a usurpation of power not given to us by the confederation; 
 a union sacred in its origin, cemented by the sufferings of the States, strength- 
 ened by habit and attection, and sacred in its objects of common security 
 against external danger and internal commotion. The articles of confede- 
 ration being the first written bond of union, let us examine the system and 
 point out its defects, that we may more easily see why the articles of con- 
 federation were abandoned for the present federal constitution. The articles 
 of confederation gave to the old Congress the powers enumerated in the pre- 
 sent constitution. The objects of both instruments were the same, the pow- 
 ers principally the same, but different in the execution of those powers. The 
 powers of confederation were federal in extent, and federal in their operation. 
 The resolves of Congress, therefore, under the articles of confederation, had 
 
BANK OF THE UNITED STATES. 
 
 no other force than recommendations to the different States. If men were 
 wanting, the States were required to furnish their quotas. If Congress want- 
 ed money for the great objects of union, they could lay and collect no tax; 
 they could only recommend to the States severally to furnish the requisition. 
 But Congress had no power to force the States to a compliance. And the 
 States could, as many of them did, refuse to furnish the requisition of men 
 and money demanded by Congress; thus the powers of the United States 
 were federal in extent and federal in their operation. The old Congress had 
 no judiciary, because that would have been unnecessary, as their resolves 
 could not be enforced upon the States in their sovereign capacity, or upon the 
 property or persons of individuals. In this state of things, when commerce 
 languished, when, under British influence, we were engaged in a bloody In- 
 dian war, and our ports and frontiers in British possession, and the States 
 refusing to furnish men and money, and comply in all things with the resolves 
 of Congress, although under constitutional obligation to do so; it was agreed, 
 by all, that the articles of confederation wanted revision and amendment; 
 the States sent their deputies for the purpose of forming a more perfect instru- 
 ment of union between the States. This was a great and a delicate trust. 
 
 Thus the present constitution originated from the defects of the confedera- 
 tion embracing the same great objects of common security; and the power 
 of both instruments are limited and federal. In fact, they are both a grant of 
 specified powers, and powers not granted to Congress are reserved to the 
 States or to the JPeople. We discover the same objects and powers in the 
 two instruments of union; differing in their operation upon the States and the 
 People. Congress has the power to lay and collect taxes, and to operate 
 upon the person and the property of every individual in the United States,, 
 and, with that view, federal, judicial, and executive branches were establish- 
 ed, by the present constitution, to carry the laws into effect, and to appoint 
 officers to collect the revenue. Congress has a right to raise an army from 
 the body of the People, and to force a draught if necessary, whereas the old 
 Congress, under the confederation, had the same right to require men and 
 money for the objects of the Confederacy; but these requisitions operated only 
 as recommendations to the States. From this statement we plainly discover 
 the great and only radical difference between the confederation and the pre- 
 sent constitution. The powers now exercised by Congress can be enforced 
 upon the persons and property of the People. This operation, and carrying 
 into effect the powers of Congress, is the national and consolidating princi- 
 ple of the constitution. 
 
 Although experience had proven the want of power in Congress to carry 
 into effect the legitimate objects of the confederation, this national or consoli- 
 dating principle in the federal constitution, was a subject of alarm and solici- 
 tude to the friends of liberty. This principle was the fruitful source of the 
 most obstinate and rational objections to the adoption of the federal constitu- 
 tion; and it was with vast difficulty that the States adopted it. In fact, it was 
 adopted under a conviction and promise that amendments would be made, 
 which would leave nothing to doubt or implication, and important amend- 
 ments were engrafted accordingly into the constitution, all tending to demon- 
 strate that we were to assume no power by implication, but confine ourselves 
 to the letter of the constitution. 
 
 To prove that the constitution should be thus construed, I need only advert 
 to the 8th section of the 1st article, in which the powers granted to Congress 
 are specifically enumerated, to lay and collect taxes, to borrow money, to 
 regulate commerce, to establish a uniform rule of naturalization, to coin mo- 
 ney, to constitute courts of justice, declare war, raise armies, to call forth 
 the militia, &c. And to the 10th section of the same article, where certain 
 powers are prohibited to the States, which had been previously vested in the 
 Congress of the United States, viz: no State shall enter into any treaty, al- 
 liance, or confederation, nor grant letters of marque and reprisal, coin money, 
 emit bills of credit, or grant any title of nobility, nor lay imposts or duties on 
 imports or exports, or lay duties on tonnage, keep troops or ships of war in 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 time of peace, or engage in war unless actually invaded, or in such danger as 
 will not admit of delay, ^.^-and the 9th amendment in these words: " the 
 enumeration in the constitution of certain rights, shall not be construed to 
 deny or disparage others retained by the People;" which amendments refer 
 to the prohibitions to be found in the 9th section of the 1st article, and others 
 of the same kind, viz: "The writ of habeas corpus shall not be suspended 
 unless when, in cases of rebellion or invasion, the public safety may require it. 
 No bill of attainder or ex post facto law to be passed. No tax or duty shall 
 be laid on articles exported from any State. No money shall be drawn from 
 the public treasury except in cases of appropriation by law. No title of no- 
 bility shall be granted," &c. And. more especially, the 10th amendment, 
 viz: "The powers not delegated to the United States by the constitution, 
 nor prohibited by it to the States, are reserved to the States, respectively, or 
 to the People." The parts of the constitution recited prove the position 
 taken, that the constitution is a grant of specified powers; that we can exer- 
 cise no power not expressly delegated to us by this instrument; that our orbit is 
 circumscribed by the grants of the constitution, and we should be careful not 
 to usurp authority not given to us. The exercise of authority not delegated, 
 but reserved to the States, or to the People, is the very essence of consolida- 
 tion, which, if enforced by the United States, would lead to monarchy or a 
 despotism. If not enforced, it would convulse the whole nation, and we 
 should see the People quitting their daily avocations; the fanner his plough, 
 the mechanic his shop, to remonstrate against a tyrannical exercise of power. 
 This we have seen on former occasions, not less memorable than this, arising 
 from the same doctrine of implication, and arising from the acts of the very 
 same set of men. The harmony of the States should not be disturbed. It 
 should not be agitated by the breath of discontent. Its value is more precious 
 than gold or silver. Tne spirit of union should be cherished by us all in 
 words and in actions. Nothing will produce more happy effects than keeping 
 in the path of our rightful powers; otherwise you generate the most angry 
 passions of the People; you start up the most malignant invectives order will 
 be disturbed, and tranquillity will be interrupted. To produce these unfor- 
 tunate effects, nothing can contribute more than to disregard the enumerated 
 powers in the constitution, and exercise tyrannical powers by implication, or 
 under some general phrases, such as the "general welfare;" expressions 
 which contain no grant of power, but limited and explained by enumerated 
 authorities; by which construction the power of Congress would be arbitrary 
 and unlimited, as Congress would take upon themselves to judge \yhat mea- 
 sures would promote this general welfare. I wish, on this occasion, to do 
 justice to the People of Kentucky, by asserting their inviolable attachment to 
 the Union, more especially since, in this House, its sacredness has been pro- 
 faned in a manner not to be forgotten. If the People of the West, and be- 
 yond the mountains, have any political idol, it is the union of the States. As the 
 bible and new testament are dear to every Christian and true believer, as the 
 basis of his happiness here, and the foundation of his future hopes; so the 
 union of the States, in a political point of view, is considered, by the People, 
 as the surest pledge for the blessing of liberty, and the security we enjoy, and 
 the ark of our future hopes and safety. Their union is never profaned by 
 conversations or speculations about disunion. You never hear disunion men- 
 tioned in private circles, much less in public bodies. A professor of religion 
 to deny the existence of an over-ruling Providence, would not be more dis- 
 graced, in the estimation of the real Christian, than a statesman would be dis- 
 graced, politically, by even doubting the advantages of the union of the States. 
 The word disunion, as applied to the States, would produce a heart-rending 
 pang in the bosom of a Western patriot, and, I hope it would, throughout the 
 seventeen United States and their territories. 
 
 The people are republican, and they abhor all measures of a monarchical 
 tendency they know the United States have been governed alternately by 
 the two great political parties in this country; they have a regard for and a con- 
 fidence in the republican party; this regard is not confined to the western 
 
230 BANK OF THE UNITED STATES. 
 
 States, but extended to every part of the United States. They believe that 
 truth and equal justice will prevail, where the opportunity is equal, and where 
 the People do exercise the powers of sovereignty. The People represent, and 
 in fact the whole of the States have confidence in every part of the United 
 States. As a People they cherish and harbor no jealousy about large and small 
 States, of commercial monopolies, &c. Nor are they thus attached to the 
 Union from selfish and interested motives; no, sir, their attachment to the 
 Union arises from a noble and generous affection, a magnanimous and disin- 
 terested display of patriotism, and love of independence; we have given many 
 proofs of this. At a time when this People were agitated and alarmed at the 
 prospect of having some of their most essential rights interrupted, and when 
 they declared their determination to support those rights, the gold and silver 
 of Spain, in the hands of Spanish emmissaries, could not alienate the affec- 
 tions of this People, with all the influence of arch intriguers; and the treason 
 of Aaron Burr had as little effect upon the minds of this virtuous and happy 
 People; and any other attempt would be as vain, however well matured. I 
 feel the consolation which arises from a knowledge that I represent in part 
 such a People, whose affections cannot be estranged from the great American 
 family, by promises of future greatness, the hopes of golden harvests, or the ex- 
 pectations of governing provinces with the silver mines of Mexico. With 
 these sentiments, I am now to examine for the particular parts of the consti 
 tution and the arguments which have been advanced to justify this measure. 
 It is not contended by any, that the power of incorporation is an express 
 power given by the constitution to the Congress of the United States, beyond 
 this ten miles, over which Congress has exclusive legislation. If then this 
 power is not expressly given, I might here stop and deny the right to exercise 
 it. So far from finding any express clause in the constitution, giving this 
 power, the word corporation or bank cannot be found in any part of this in- 
 strument of our Union. 
 
 We have seen the exercise of great abilities, and we have been entertained 
 with great research by those who advocate the renewal of this charter; but, un- 
 fortunately, these gentlemen cannot agree among themselves. Is this not the 
 strongest proof that the power to incorporate this bank is not given by the con- 
 stitution, and does it not demonstrate the danger of constructive powers? One 
 has contended that this power was inclusive in some of the specified powers; 
 another has contended that this power is given by implication; and a third 
 contends, that it is an incidental power given to carry some specified power 
 into operation. This is not all; the advocates cannot agree upon the speci- 
 fied power in the constitution, out of which this power or means arises. One 
 has contended that the power to lay and collect taxes gives this pow r er, as a 
 means to execute the specified povyer; and to support this position, it has been 
 contended that this national bank is necessary and proper, as a means to lay 
 and collect taxes, duties, &c. To strengthen this construction, that part of 
 the 8th section of the first article, which says that " Congress shall have 
 power to make all laws which shall be necessary and proper for earring into 
 execution the foregoing powers," &c. has been resorted to; another has said that 
 this instrumental power grows put of the express power to borrow money; 
 and a third, that this power was incident to the power to regulate commerce, 
 and in fact these three great objects are embraced by the preamble of the bill 
 which piassedin 1791, which incorporated this moneyed aristocracy and erect- 
 ed a privileged order of men. With respect to the declaration in the con- 
 stitution, that Congress may make all laws necessary and proper to carry the 
 express powers into effect, I should state that the framers of the constitution 
 intended by this declaration to prevent the doctrine of implication, and to 
 leave nothing to doubt. It was introduced through abundant caution against 
 the strides of usurpation, and it should be the last clause to which he should 
 advert, upon which to build the doctrine of unlimited means, to carry the ex- 
 press powers of the constitution into effect. If our means are unlimited, our 
 powers need not be defined; because one, as much as the other, is a destruction 
 of our freedom and independence. I shall contend, that the means by which 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 we are to carry into effect any express authority should be adapted to the 
 end in view; that it should not embrace other objects, not contemplated by the 
 constitution, although it may be made instrumental in carrying into effect a 
 specified authority. Under this cloak we might conceal our usurpation of 
 power. 
 
 I will ask if this national bank is necessary and proper, as a mean to carry 
 into effect the power to lay and collect taxes, duties on imports &c. to borrow 
 money, or to regulate commerce. If necessary and proper, is this bank con- 
 fined to any one of these objects, exclusively, or to all collectively; or does it 
 embrace a vast variety of other objects, which are the primary ones, in fact, of 
 this institution, and only embracing these powers in the constitution, incident- 
 ally and as secondary considerations? Sir, it will be difficult to convince the 
 People that it is necessary, in the language of the constitution, to create a 
 moneyed aristocracy and a privileged order of men, extending its branches, its 
 influence, and its strength, into the interior of every State, to collect taxes, 
 to borrow money, or to regulate commerce. The primary object of this in- 
 corporation was to promote usurpation of power, to support the dangerous 
 doctrine of implication, and to amass wealth fromthe labor of the People, and 
 not for the exclusive object of carrying into effect any express authority in the 
 constitution. Thus, it is evident that this moneyed aristocracy, embracing 
 such avast variety of objects, no ways connected with the execution of any 
 specific grant of power, that it departs from the letter and meaning of that part 
 of the constitution which gives the power to carry into effect the specified 
 powers of the constitution. But now let us inquire what is the necessary 
 means to lay and collect taxes. If a bank was not intended, I will take du- 
 ties upon imports, us in that way we collect our revenue. First, a law must 
 pass designating the articles upon which ii duty shall be laid, the amount of 
 that duty, and the manner in which it shall be paid, either upon the delivery 
 of the goods, or upon a credit, by giving bond with security, and last, to ap- 
 point collectors of the revenue and other ofticers to collect and receive this re- 
 venue for the United States, with authority to bring suit upon failure of pay- 
 ment. This is a necessary exercise of the power to lay and collect taxes, &c. 
 And where is the statesman who has denied the power as unconstitutional? 
 Here these means are confined to the object in view, the collection of reve- 
 nue, and certainly the United States have power sufficient for all the objects 
 of the confederacy, as, in the exercise of all the specific grants of authority, 
 Congress may operate upon the person and property of the individuals of the 
 States to enforce that authority. 
 
 It is no argument with me, that we are in prosperity and health, and such 
 an institution will not be dangerous. No, sir, establish a precedent in the 
 days of prosperity, and it will come upon you in the hour of adversity. This 
 same doctrine of our being unlimited in our means of carrying into effect the 
 grant of powers in the constitution, has already endangered the liberty of this 
 nation. If the doctrine contended for on this occasion be correct and carried 
 into full force, Congress would be as omnipotent as the parliament of Great 
 Britain the constitution would no longer restrain us and the independence 
 of this nation would depend upon the caprice of Congress our constitution 
 would be like the boasted constitution of Englishmen; and what is that con- 
 stitution? Sir, it is not lettered or defined like ours. It may be changed 
 by parliament, as the crown party, or the people, shall prevail. 1st. The great 
 charter of liberty, obtained from King John, violently, and in duress, declar- 
 ing what should be considered the fundamental laws of England. 3d. A sta- 
 tute in confirmation of the great charter, making provisions to read the same 
 to the people in their churches and public places, semi-annually. 3d. A num- 
 ber of statutes, called the conforming statutes, from the reign of Edward I. 
 to Henry IV. 4th. Next the petition of rights, a declaration by parlia- 
 ment of the liberties of Englishmen, extorted from Charles the first, before the 
 rupture with his parliament. The habeas corpus act, in the reign of Charles 
 II. 6th. The bill of rights, and declaration of lords and commons of Eng- 
 land, in 1688. 7th. The act of settlement at the commencement of the 18th 
 
BANK OF THE UNITED STATES. 
 
 ceniury, endeavoring to secure the English subject in his personal liberty, se- 
 curity, and property. These, and the like parliamentary declarations and sta- 
 tutory provisions, constitute the constitution of England, which the same par- 
 liament has a right to alter or abolish. I never wish to see Congress invested 
 with a power to change the^ constitution, sanctioned by the People in their 
 highest sovereign capacity. The constitution has vested us with power enough, 
 and if we want more, amend the constitution in a constitutional way, and not 
 tyranically exercise power never delegated to this body. The ground on 
 which we stand is delicate, and the duty we owe the People should teach us 
 caution, more especially when we see men in power too apt to grasp at more, 
 and exercise it oppressively. We should never forget that all power flows 
 from the People; they are sovereign I hope they will ever remain sovereign 
 in this country. Our safety is with them. They are unambitious, they are 
 virtuous, and have no temptation to overturn those liberties which they them- 
 selves enjoy. But this measure is a violation of the constitution in another re- 
 spect, by interfering with State rights. This corporation can send a branch 
 bank to any part of the United States, without consulting the States or the 
 citizens of the States. Suppose, sir, they should send one of these branches 
 to Frankfort, Kentucky, with a great capital, and under the sanction of the 
 General Government, would it not lessen the profits arising to the State, and 
 to the People of the State, from the State bank of Kentucky, as established by 
 the laws of that State? I presume it would. It would contract very mucn 
 the circulation of the State bank notes, and would, in many other respects, 
 come in collision with State rights. Every State has aright to regulate its own 
 moneyed concerns; to incorporate banks or not, as interest or inclination may 
 dictate. But, in the zeal of some gentlemen, to continue this moneyed aristoc- 
 racy in the United States, for twenty years to come, they have denied the 
 right of the States to incorporate banks, and that Congress alone has the power. 
 This doctrine is new to me. When Mr. Madison and other patriotic states- 
 men denounced this measure, as unconstitutional, in 1791, it was not contend- 
 ed that the States had no right. It was admitted, by the lovers of implication., 
 that there was a concurrent right. Thus we behold the progress of opinion to 
 support a favorite measure. 
 
 If this bill passes, and the States have no right to incorporate banks, I sup- 
 pose the State banks throughout the United States must be put down or burnt 
 up, to give way to this great engine of foreign influence. "The States shall 
 not emit bills of credit." This is the prohibition relied on to take the right of 
 incorporation from the States. Bills of credit is another phrase for paper 
 money. The States shall not issue paper money and make it a legal tender. 
 The men of the Revolution know this. The great calamity which individuals 
 suffered by the paper money, demonstrated the necessity. But no man is 
 obliged to take the bank notes of a State bank, for the payment of a debt, or 
 in common transactions. It is at his option, and the moment you get a bank 
 note, you may present it to the bank and demand your money. Not so with 
 bills of credit or paper money, issued and made such by the State. It would 
 be extremely difficult, I presume, for any gentleman to convince the States by 
 argunient, that they had no right to incorporate banks, and it would be equal- 
 ly difficult to force the States to destroy their local banks for the United 
 States Bank, owned principally by foreigners. Not only the bank, in its 
 moneyed operations, would interfere with State rights; but. the rules and regu- 
 lations of the bank, as heretofore established by Congress, have interfered with 
 the laws of the several States in these municipal regulations, as to the tenure 
 of property, and the liability of the corporation to pay their debts. 
 
 Mr. Speaker, I have said as much as I conceive it my duty, upon the uncon- 
 titutionality of the bank charter. I am to ask your indulgence, while I endea- 
 vor to prove its inexpediency, and its dangerous tendency to the freedom of 
 this nation. In the hand of a private citizen wealth will, at all times, have its 
 influence, and may attach to him an importance beyond his merits. But this 
 influence is not so dangerous as to induce a government to interpose and li- 
 mit the honest accumulation of property by any citizen. And though this 
 
t)N THE BILL TO RENEW THE CHARTER OF 1791. 
 
 wealth may have its influence, it is always limited. It may frequently be in 
 the hands of the benevolent man: and, if not of this character, this vast wealth 
 ..seldom survives the death of the individual proprietor. It is either divided 
 <imong numerous relations, or squandered by his heir. But not so vvith a body 
 corporate, extended thoughout this vast empire, pssesed of a capital of ten 
 millions of dollars, and extending'their credit and accommodations to double 
 that sum, notwithstanding their limit to ten millions. It is stated by an 
 advocate for this bank, that the stockholders commenced their discounts with - 
 -about G25.000 dollars, and that, upon this sum, they discounted to the amount 
 of 6,000,000 of dollars the first ten months after it went into operation. To 
 divide this 10 millions or -20 millions of capital in local or state banks, no se- 
 rious danger could be apprehended, because the stockholders of one institu- 
 tion would be strangers to all the other stockholders; so of the directors of the 
 different local institutions, and consequently there could be no combination 
 betwen the different banks. But it is otherwise, and the danger is imminent, 
 when you. by act of the General Government, give unity of action, unity of will, 
 and unity of strength, to a moneyed arUtocray, vested with a capital of ten 
 millions of dollars, with power to increase their accommodation to twenty 
 millions, and to send their branch banks into the bosom of every .State and terri- 
 tory, Thi.> i-. not all: your revenue bonds, to the amount of millions, are de- 
 posited with this bank for collection, and the public money deposited in this 
 bank to the amount of millions for safe keeping, and (heir notes made pay- 
 able to the United Slates the -ame as gold and silver. Sir, is there no dan- 
 ger in such a monster/fbstered by the General Government, and possessing so 
 many advantages by the laws oV CongivsN? Such a bank, in its beginning, 
 would confine n- engagements to the maiis of payment but as their credit 
 increases, they engage beyond their means: then- vaults are empty, ^and the 
 institution relies upon ite great credit and exclusive privileges. Thus the. 
 character of the bank is changed, and it becomes a system of Speculation, and 
 a political engine to destroy virtuous individuals, cr mould the Government to 
 its notions. 
 
 I have no knowledge myself aboul Hie political workings of this United - 
 States' Hunk. But if I were to believe the declarations of members on this 
 floor, and complaints from every part of this continent, I must think that this 
 institution has not been silent and indifferent spectators to the reform of the 
 administration to republican principles but they have endeavored to support 
 that party who gave them a charter. I do not, however, introduce this as a 
 conclusive argument against this bank. No, sir, I would equally object to it 
 in the hands of republicans. It would still be a moneyed aristocracy, too vast 
 and too powerful not to be dangerous to the freedom of the United States. But 
 without these declarations'of political influence exercised by the stockholders 
 and directors of these banks, our own reason would teach us to believe all we 
 have heard of the oppression and partiality of this bank. It is composed of 
 individuals: these individuals have their passions, their feelings, their preju- 
 dices, their partialities, and their politics, and they will act acordingly. Self- 
 rvation will always induce tnem to support and keep in power the party 
 who will be most freindly to moneyed aristocracies and their own institution. 
 The influence of this bank is palpable and notorious. We have the evidence 
 from the long roll of petitioners now imploring Congress to renew the charter. 
 
 If in twenty years this bank is to be the idol of some and the alarm of others 
 if the solvency of so many individuals depend on it if ruin and devastation 
 will, in the event of its dissolution, spread wide in the country then, sir, it will 
 only require twenty years more to make it stronger than the Government. 
 To induce us to vote for this institution, we have been persuaded, flat- 
 tered, alarmed, petitioned, and threatened, and we have been amused with the 
 rise and history of the banking system. It originated in Italy, it has travelled 
 through Europe, crossed the British channel to Great Britan, and lastly, it 
 crossed the wide Atlantic to America. And much has been said of the utility 
 of those institutions. Without dwelling upon the utility of banks at present. 
 J could only admit them as a necessary evil, and not dangerous, if left to 
 SO 
 
BANK OF THE UNITED STATES. 
 
 the control of our State Governments. But the history of those banks which 
 have been quoted, will furnish no argument in favor of a national bank. 
 
 We wish no political engine of a moneyed aristocracy. We wish to rest 
 upon the virtue and will of the People. 
 
 It has been stated that Georgia is republican, notwithstanding this mon- 
 strous machine has extended a branch bank to this State; and it is stated that 
 Connecticut is federal, and has no Branch Bank of the United States. This 
 does not prove that the bank is not a dangerous engine against the liberties of 
 the People; but it proves, that the People of Georgia withstood this dangerous 
 influence, and deserve more credit. It is a proof of the virtue of that Peo- 
 ple. If this institution is so necessary and beneficial, why do not the repre- 
 sentatives of Georgia, who have been blessed with this institution, come for- 
 ward and advocate a renewal of the charter? But you find the respectable 
 memoers of Georgia opposing a continuance of this evil in every form. In 
 fact, the State of Georgia taxed the paper of this bank, and the State was 
 determined, by taxation or legislative prohibition, to drive this circulating 
 medium from their territory. But considerations of wisdom induced a post- 
 ponement of this determination, until it should be seen whether the charter 
 would again be renewed, in violation of the constitution, and in defiance of 
 our liberties. My colleague (Mr. McKEE) whose opinions I had been in the 
 habit of considering as my own, until this unfortunate question, which divides 
 us, has stated, that, in his opinion, the dissolution of this institution would 
 be felt by the citizens of the western country, and that our surplus hemp 
 would not command as good a price, 1 dift'er in opinion from my colleague, 
 if he supposes the western country will feel any great pressure from the dis- 
 solution of this bank. I grant, the People of Kentucky may not be entirely 
 exempt from some inconveniences common on such an event. But our pro- 
 duce will fall from other very different causes. Interruptions in commerce* 
 stagnation in trade, bankruptcies throughout the commercial part of the United 
 States, arising from the bankruptcies in England, which have occasioned the 
 return of many bills from England protested. These are the causes which 
 produce distress, and will continue to produce it, until we are a People less 
 dependent on foreign commerce. But believing as I do on this subject?, 
 viewing the effects of this great political moneyed institution with abhorrence, 
 I would not vote it, let the temporary distress be what it may. I would rather 
 see 'the present crop of hemp Drought to one deposit e, which would make a 
 bulk larger than this capitol, and consumed with a lighted torch, and ascend 
 to the heavens in smoke as a bonfire, rather than vote for the passage of this 
 law; and, sir, the People I represent would justify my vote. They would 
 bear the loss without a murmur; they would act the part of freemen worthy 
 of freedom; they would magnanimously bear the calamity without complaint, 
 if their patriotism required the sacrifice. They are a most worthy People a 
 virtuous People an enlightened People a glorious People descendants of 
 this great American family; inheriting that spirit of independence which 
 equally sustained our cause under defeat and victory, upon all the battle 
 grounds of the Revolution. I will not be alarmed out of my vote by clamor, 
 no matter from what quarter it may assail me. I never will be driven from 
 my duty by alarms and fears. I will stand firm to the cause I conceive to 
 be just, and the People will support me; they despise wavering and tempo- 
 rising. If you continue this charter twenty years more, you can never put 
 it down. No, sir; instead of having petitions which would reach from the 
 speaker to the seat of the members, 'you would have them packed upon your 
 table, until they would intercept my view in addressing you. Yes, sir, they 
 would rise up higher, and implore that goddess of liberty which presides over 
 the deliberations of this House. We are told, that this bank is necessary to 
 the collection, the sate keeping, and the transmission of the revenue, to dif- 
 ferent parts of the United States. It is stated that the State banks are 
 strangers to us, and cannot be trusted with the deposite of public money. I 
 am sorry to hear such a sentiment. It has originated from a panic, an alarm, 
 an ideal danger. That great and good man, the Secretary of the Treasury, has 
 
ON THE BILL TO RENEW THE CHARTER OP 1791. 235 
 
 told you otherwise, by his report now before me, of date 12th of January, in 
 Which it appears that, of about 2,460,000 dollars, upwards of 800,000 dollars 
 ore deposited in the State banks, $75,000 of which are deposited in the State 
 Bank of Kentucky, ami I should be sorry if it was not as safe there, as in the 
 hands of the United States' Bank, 1 in the possession of foreigners: if t State 
 banks will not do, let the United States build vaults lor the safe keeping ot 
 the revenue. 
 
 But, sir, the alarming consequences which imi*i arise from a dissolution of 
 this corporation. It will deprive us of a circulating medium; it will interrupt 
 -commerce ami produce bankruptcies. It is to produce the distress of farmers 
 r.nd the ruin of merchants; it is to prevent emigration ; and it is to shake 
 the foundations of the Government, This .picture gives me no alarm. It is 
 the picture of a wild and distempered imagination. If serious injury will be 
 felt by many in the power of this moneyed aristocracy, I feel and sympathise 
 with the sufferings of those who may be needy without any fault of their own; 
 but something is due to posterity; :ind even in that point of view, I am not 
 willing to entail upon them the baneful effects of a great moneyed corporation, 
 with a capital of twenty millions of dollars, extending their arms of power and 
 influence to every part of the United States, and having the destiny of good 
 men within their control, whenever they receive the nod to exercise their giant 
 power. No, sir, I am ready to see ancl feel the sad crisis which has been de- 
 scribed. If we die with less money, we shall live in more honor and enjoy 
 more liappiness. 1 wish to see whether so much depends upon this corpora- 
 tion. If so, it is the greater reason why the poison should be destroyed. Like 
 the strong man we read of in h:>ly writ, lot us see if the violent death of this 
 corporate body will pull down the* pillars of the constitution, that another Vol- 
 ney may sit upon the ruins of this capital, and mourn the fallen empire of this 
 great and happy republic. 
 
 MR. SHEFFEV. Mr. Speaker: It was my intention not to address anv obser- 
 vations to you on the .-ubject now before the House, but reasons whicn I can- 
 not disregard have induced me to request your attention. I am confident, 
 when the importance of the question is considered a question in which is 
 involved the integrity of a constitution we all profess to adore, and the pros- 
 perity of a country we all profess to love, the House will listen to every thing 
 that can be said, not only with patience, but with pleasure. 
 
 I have been led to make the remarks, which I am about to offer, by con- 
 siderations distinct from the intrinsic merits of the question. In the vote 
 which I shall give, I shall disagree with a majority of my honorable colleagues, 
 whose opinions are entitled to my respect. The sentiments of a great portion 
 of the People of the State which I have the honor in part to represent, so far as 
 they can be collected from the opinions of her Legislature and my own, do not 
 correspond on this occasion; arid I must superadd, that no question ever was 
 presented to my mind, in the course of my public duty, which, at first view, 
 appeared attended with more difficulty. I have, therefore, thought it proper 
 to state the reasons of my vote to the House, to enable my country to appre- 
 ciate them, and my constituents to interpose their corrective, should they 
 deem them unsatisfactory. 
 
 I had hoped that this question would have been discussed, and determined, 
 abstracted from all party considerations; that our attention would have been 
 exclusively directed to the effects of this measure upon the community, whose 
 interests are committed to us; and our solicitude employed to keep within the 
 limits prescribed by the constitution. But we have been invited to a differ- 
 ent course. My honorable colleague (Mu. EPPES) told us the other day, that 
 we need not expect that this question would be determined on any other than 
 party principles; that party principles gave birth to the charter of the bank 
 originally, and that that \vas the first great question which separated the two 
 parties in this country. Was the fact ever conceded, the conclusion does not 
 appear to me inevitable that this must now be a party question. At that time 
 it was a matter of speculation and conjecture, what means would be "necessa- 
 
236 BANK OF THE UNITED STATES. 
 
 ry and proper" to give effect to the delegated powers confided to this Govern- 
 ment. The light afforded us by twenty years' experience has banished them 
 and substituted certainty in their stead. We have now before us the practi- 
 cal operations of the Government, calculated to show the fallacy ot 'reasonings 
 founded on plausible but untried theories. With these means within their 
 power, it does not appear to rue that those act inconsistent with their former 
 principles, who now conceive the necessity of a bank as an instrument to car- 
 ry on the fiscal concerns of the Government, though (unaided by the best of 
 all human guides, experience} they might have thought different in the infant 
 state of an operation. 
 
 But my honorable colleague has committed an error in point of fact in giving 
 the statement to the House, that this originally wa* a party question. I had 
 taken it for granted that the fact was as stated by him, but, on recurring to 
 the Journal of this House for the year 1791, (which I hope I shall be par- 
 doned in receiving as better evidence than his declaration, however im- 
 plicitly I might rely on him on other occasions) I find that a considerable 
 portion of the federal members voted against4he incorporation of the bank, and 
 a still greater portion of the republicans for it ; besides, as the measure was 
 then contested on the ground that there was no constitutional power in Con- 
 gress to adopt it, which always involves matter of conscience, I cannot submit 
 to the idea that one political party exclusively entertained conscientious scru- 
 ples when violence was threatened the constitution. This would be degrading 
 one half of the American People. 
 
 [Mr. EPPES rose to explain. He said he apprehended, from the various 
 observations which had been made, that he had been misunderstood in what 
 he said a few days ago. He meant to say, that there were, from the com- 
 mencement of the Government, two opposite opinions entertained, with re- 
 spect to its powers. One was, that they were strictly conformed to the ob- 
 jects delegated ; the other was, that there were certain implied powers which 
 the Government might exercise, that did not appear on the face of the con 
 stitution; that the latter opinion gave birth to the alien and sedition laws, and 
 the stamp act, and that this was the party principle he meant, which gave 
 birth to the bank charter. As to conscience being monopolized by one party, 
 he had never entertained any such idea; he knew men of the federal party, 
 who were as conscientious as he was, and as much attached to the welfare of 
 the country.] 
 
 Mr. SHEFFEY proceeded. Mr. Speaker, I dp not believe that my honora- 
 ble colleague was actuated by any improper motive, in making the declaration 
 he did. During the time I have been associated with him in public life, I 
 have had no cause to believe that he was under any such influence. That the 
 opinions stated by him, existed early in this Government, cannot be denied. 
 They are attributable to very obvious causes. On the one hand, those who 
 were the friends of the constitution, were friendly to the exercise of all the 
 legitimate powers confided to the General Government, under the impression 
 that it was necessary to preserve the Union; many, indeed, supposed that the 
 powers delegated were still tro feeble to secure that great object, unless sup- 
 ported by a very extensive and liberal construction. On the other hand, there 
 were those who were apprehensive that the powers of the General Government 
 were of a character calculated to swallow up the State authorities, and sub- 
 vert the rights of the People. These, after their efforts had been unsuccess- 
 ful in the conventions of the States, on the adoption of the constitution, 
 brought with them (with the best intentions) into the counsels of the new Go- 
 vernment, their solicitude for popular rights and State sovereignty, without 
 sufficiently regarding the importance of the Union, and the means necessary 
 to preserve it; and, while some of their political opponents contended for a 
 construction which produced some very obnoxious measures, they, if success 
 had attended their efforts, would have brought the Union to the feeble state 
 in which the old confederation had left it, and I hesitate not to declare, by this 
 time, we should have been a divided, distracted, and enslaved People. 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 327 
 
 Much has been said, in the course of this debate, about the State rights, and 
 the offence which will be given to the States, should this measure be adopted. 
 There is certainly propriety in preserving to the States their legitimate au- 
 thority, and in manifesting a jealousy whenever it is threatened with any in- 
 fraction; because the rights of the People are then in jeopardy. But, let it 
 not be forgotten, that every relaxation on the part of this Government, weak- 
 ens the Union, without which, the rights of the People are but an empty name. 
 8ir, he who impairs the powers properly belonging to us, is as much the ene- 
 my of the People, as he who subverts the State authorities possibly can be; he 
 is as criminal, who weakens in the least degree, the bonds which unite us, as 
 he who places upon our necks an iron yoke to keep us together. 
 
 If we should pursue the course which the observations of some gentlemen 
 seem to recommend, not to adopt the bill before you, because it will give of- 
 fence to the States, and bring us into collision with them; to what a misera- 
 ble state must this Government, and consequently, this Union, be very spee- 
 dily brought? It is in the nature of man to thirst for power, and to employ 
 all his means to obtain it. From this spirit, the State Governments are not 
 exempt; but, on the contrary, we have abundant reason to know that it pre- 
 vails there in an eminent degree. Let it once be established as a principle, 
 not to exercise any particular power, because it is disagreeable to some of the 
 States, and I pledge myself, that, in a very little time, you will not be able to 
 exercise any whatever. You will have to recede, step by step, as they advance 
 upon you, (which they will be sure to do) until you possess nothing but the 
 shadow of authority; and this Union, the last and be>t hope of the friends of 
 liberty, must dissolve in its own weakness. Sir. 1 fear, when that is gone, 
 there never will be sufficient patriotism and unanimity, nor a sufficient por- 
 tion of a conciliating spirit, to reunite us in any form of government, which, 
 while it secures to us the principles of a free constitution, has sufficient ener- 
 gy to maintain itself. The consequences are easily foreseen. We shall be 
 lo.-sed about, divided and distracted, until we finally share the destiny of 
 other nations seek repose from the evils of anarchy in the arms of despotism. 
 
 A principle, equally untenable, and equally productive of mischief, has 
 been advanced in debate, particularly by the honorable member from New 
 York, (Mr. PORTER) that no power can be exercised by this Government, 
 which interferes with the remaining powers of the States. Sir, sonre of the 
 pr unary powers confided to us. are concurrent with the powers of the States. 
 Such, for instance, is the power of internal taxation. Kvery cent which we 
 draw from the citizen by virtue of that power, diminishes his ability to pay 
 his taxes to the State ot which he is an inhabitant, and, consequently, narrows 
 the circle of State legislation. And. indeed, cases might be supposed, where 
 the necessities of this Government required taxes commensurate with the ut- 
 most ability of the People to pay, which, in effect, would be a total suspension 
 of the power of the States to lay and collect taxes. Yet, can it be pretended, 
 that, in the amount of public contributions, which it may be necessary to re- 
 quire, we are limited by any other restriction than that which a sound discre- 
 tion and a due regard to the welfare of the community imposes? The same 
 principle applies to the means which may be necessary to carry the delegated 
 powers into effect; they may be legitimate, though they interfere with the le- 
 gislation of the States. 
 
 Having detained you thus long with the preliminary remarks which f iuid 
 to offer, permit me now, sir, to lead your attention more directly to the sub- 
 ject before us. 
 
 The most important principle involved in this question, is, whether the con- 
 stitution has delegated to us the power to legislate upon this subject, in the 
 manner proposed. It is admitted on all sides, that, unless that power exists, 
 let the inconveniences, and even calamities which will follow the rejection of 
 this bill, be what they may, the high duty which we owe to the country, not to 
 transcend the limits prescribed to us, is superior to every other, and must 
 imperiously lead us to that result. In order, therefore, to approach the minor 
 question of expediency, it is necessary to ascertain, whether, by a rational 
 
>38 BANK OF THE UNITED STATES. 
 
 and unbiassed construction of the constitution, this power is fairly apparent, 
 either as directly or indirectly given either as a power original and express, 
 or derivative and implied. 
 
 It has never been contended that the constitution expressly delegates the 
 power to create banks; but that such institutions may be established as instru- 
 mental in giving effect to some one or more of the delegated powers. In the 
 course of the observations which I propose to submit on this part of the sub- 
 ject, I shall attempt to prove that Congress are not restricted in the means 
 to execute the delegated powers, except so far as the constitution expressly 
 restricts them; but that they may employ any, which they deem "necessary 
 and proper ," without violating the constitution. 
 
 To enable us to give correct constructions to the acts of individuals and 
 of public bodies, it frequently becomes important that we should consider the 
 time in which they happened,, and the circumstances under \yhich the persons 
 concerned acted. Tn legislation and jurisprudence, this is a very general 
 maxim, and seems to me peculiarly proper to be called in aid on the present 
 occasion. It will afford us the best ideas of the evils under which this coun- 
 try labored, when the constitution, under whose authority we now act, was 
 proposed and adopted, and, consequently, of the extent of the relief which 
 that remedy was intended to give. 
 
 Let us, then, see what was the situation of this country at that period of our 
 history, and what were the causes which led to that great event. It was not 
 the want of a general government that induced the People of the United States 
 to seek security in the present constitution, but the want of one with sufficient 
 powers for the purposes of union. That want of efficiency which character- 
 ized the confederation, emphatically styled " a rope of sand," was not the 
 effect of the limited subjects confided to the deliberations of Congress, but the 
 limited means to carry their determinations into effect. On recurring to that 
 instrument, it will be seen, as has been stated by an honorable member from 
 Kentucky, (Mr. JOHNSON) that the subjects embraced are little short of those 
 vested in this Government. Congress was clothed with all the great attri- 
 butes of sovereignty. They had the power to determine on peace or war; to 
 regulate commerce (through the medium of commercial treaties) with foreign 
 nations; to regulate trade with the Indian tribes; to grant letters of marque 
 and reprisal; to coin money, and regulate the value thereof; to raise armies 
 and navies; to borrow money on the credit of the United States; and many 
 other powers of minor importance. Had they had the means to carry their 
 resolutions into effect through the agency of their own executive and judicial 
 authorities, and could their acts have reached the People, instead of being de- 
 pendent for their execution on the will of the States, 1 venture to say that this 
 constitution would not have been proposed. It is true, that the organization 
 of the Government, under the confederation, was greatly defective; yet, that 
 was not the cause of its dissolution. It was the imbecility, arising from the 
 want of means, in the old Congress, that assembled the general convention. 
 It was that which produced the constitution of the United States, the primary 
 object of which, and of the People who adopted it, was to place into the hands 
 of the new Government, means commensurate with the due execution of all 
 the powers confided to it. Is it rational, therefore, to suppose, that, under 
 this impulse, under the pressure of the evil which every one felt, and the 
 cause of which every one knew, those who framed and adopted this instru- 
 ment could have intended that we should be circumscribed in the means deem- 
 ed necessary to give effect to our measures, or (as some gentlemen strangely 
 suppose) be dependent on the States for them ? Is it in the least probable, 
 that the men, selected for their wisdom, perfectly acquainted with the pro- 
 gress of man in every age; who foresaw the changes which the state of society 
 must undergo, in this country, from the increase of population, commerce, and 
 the arts, could act so absurdly as to prescribe a certain set of means to carry 
 on the operations of a Government, intended, not only for the present, but 
 for future generations ? There are, indeed, some express limitations, which 
 the circumstances of the times, and the jealousies of the parties, produced; 
 
ON THE BTLL TO RENEW THE CHARTER OF [1791. 239 
 
 but, they being expressly stated, prove that the means, not interdicted, re- 
 main entirely at our discretion. 
 
 When we examine the various parts of the constitution, with a view to this 
 question, we shall see many reasons in support of the principle for which I 
 contend. The last clause of the 8th section of the first article invests Con- 
 gress with the " power to make all laws which shall be necessary and proper 
 to carry into effect the delegated powers, and all powers vested in the Go- 
 vernment of the United States, or in any department or oflice thereof." To 
 whom is confided the right to judge what shall be " necessary and proper?" 
 I presume it will be admitted that this right is exclusively inherent in Con- 
 gress. And, if Congress alone have the right to judge of the necessity and 
 propriety of the means, is it not absurd to say that they must judge rightly, 
 or they have no right to judge at all ? 1 have always supposed, when a sub- 
 ject is within the legitimate authority of any men, or body of men, an errone- 
 ous decision upon such subject does not prove a want of jurisdiction, but of 
 correct judgment. On this, as on every other subject, there will be a vari- 
 ety of opinions as to what is " necessary and proper." The majority must 
 determine that question; and, although there may, in this, as in every other 
 case, be flagrant abuses of power, for which we are responsible, there never 
 can be any usurpation. Ir must always be a question of sound discretion, 
 guided by the interests of the I'liion, and not a question of power; unless, in- 
 deed, we should fall in with the fancy of my honorable colleague, (Mr. BUR- 
 WELL) who opened this debate, and interpolate the word ki absolutely," so 
 that he could adopt no means but such as air "absolutely necessary," which 
 would leave us, as has been ably demonstrated by the honorable member from 
 Maryland, (Mr. K.KY) without any power at all. 
 
 Kverv subject which is presented to us within the acknowledged sphere of 
 our authority, involves the question whether it is " necessary and proper." If 
 a tax be proposed, which (as the constitution is expounded by some, and 
 which, I believe to be correct) can only be laid " to pay the debts and pro- 
 vide for the common defence and general welfare/' it may be objected that it 
 is unconstitutional: because these objects maybe provided for without any 
 lax, or without the one proposed. But there can be no doubt that this woulcl 
 be exclusively a question (.t expediency and discretion. 
 
 The constitution of the Tinted States has universally been considered as a 
 grant of particular and nor ot general powers: those powers are the primary 
 or expre.-sly delegated, and the derivative or implied. The character of the 
 instrument precluded the necessity of a 4i bill of rights," because the question 
 never could arise, what wan reserved, buf, rvhat was granted. The Cramers 
 of the constitution were well aware of this; and so were the People who adopt- 
 ed it. it is, therefore, fairly to be inferred, that, whenever there appears a 
 limitation or restriction in the shape of a negative clause, Congress might have 
 exercised the power interdicted, had such clause not been made part of the 
 instrument. By examining this part of the subject, we will be able to deter- 
 mine hovy far it was supposed derivative or implied powers would extend when 
 not restricted. 
 
 The first clause of the 9th section of the first article, provides, that " the 
 migration or importation of such persons as any of the States now existing shall 
 think proper to admit, shall not be prohibited by the Congress prior to the 
 year 1808, but a tax or duty may be imposed on such importation, not exceed- 
 ing ten dollars for each person. ' 
 
 Among the delegated powers, the right to prohibit the migration or impor- 
 tation of persons into the States, is no where to be seen; but it was justlv 
 conceived that it was incidental to the power " to regulate commerce with 
 foreign nations." 
 
 The second clause of the same section restricts the suspension of the writ 
 of habeas corpus to certain circumstances. There is no express power given 
 to any department to grant it, in any instance. But Congress have the pow- 
 er to organize the judicial courts, to which is incident, the power to regulate 
 V'rits and other processes. And as this celebrated writ was deemed the 
 
240 BANK OF THE UNITED STATES. 
 
 birth-right of the People of the States, under the State authorities, as the in- 
 strument to release them from arbitrary imprisonments, it was taken for grant- 
 ed that its benefits would be extended to them under this Government, and it 
 was conceived necessary to restrict the discretion of Congress in suspending 
 its sal utary operations. 
 
 In the third clause of the same section, Congress are prohibited from pass- 
 ing any bill of attainder, or ex post facto law. Congress are no where direct- 
 ly authorized thus to interfere with the ordinary course of justice, so as to sub- 
 ject an individual to the consequences of an attainder, at their own mere will, 
 without a trial; or, to make an innocent act criminal, by a posterior declara- 
 tion. But they have the power to define and punish certain offences, which 
 would have implied the power to do it in any manner they might have thought 
 proper: hence it became necessary to interpose this restriction. 
 
 The next three clauses contain restrictions on the power to lay and collect 
 taxes, and appropriate their proceeds; and shew that it was considered as un- 
 limited, unless expressly restricted. 
 
 The last clause in the same section gives a more comprehensive idea of the 
 extent to which the framers of the constitution conceived the implied powers 
 of this Government might be exercised, if not restricted. It provides, " that 
 no title of nobility shall be granted by the United States." The whole context 
 of the constitution does not afford the most distant hint, that the creation of 
 an aristocracy is among the delegated powers. And yet the interdiction to 
 create such a body, the very name of which is so justly abhorrent in this coun- 
 try, was deemed necessary. And why ? Because this Government has the 
 power to raise and support armies and navies. It has various important con- 
 cerns committed to it, in which eminent men inay render great and meritorius 
 services. And, as it would not have been restricted in rewarding them accord- 
 ing to its pleasure, it might, in conformity with the usage of other nations, 
 have conferred distinction upon them; which, tlfough they could give no ex- 
 clusive right to office, might be attended with emolument and honor. 
 
 If the doctrines which have been advanced upon this floor, during the pre- 
 sent debate, are truly genuine and constitutional, then does the history of this 
 country, for the last tvventy years, present a spectacle the most alarming: then 
 have the operations of our Government been nothing but an uninterrupted 
 scene of usurpation. From its organization, under the auspices of the first 
 of men and of patriots, until the present moment, violation lias succeeded vio- 
 lation; the constitution has been trodden under foot by all parties, and is no 
 longer worth preserving. Sir, I will go further. I venture to say. that, if those 
 doctrines are adhered to and acted on in every instance, this Government is 
 at an end. It cannot adopt the simplest measures necessary for its own exist- 
 ence and for the welfare of this People, without resorting to means not ex- 
 pressly delegated. If this critical construction prevails, we have no right to 
 disband one single man from the army or navy. Congress are expressly au- 
 thorized to raise and support them: but the power to lessen and destroy them, 
 is not to be seen on the face of the constitution. We are invested with the 
 power to regulate commerce with foreign nations; but where is the authority 
 to suspend or annihilate it by an embargo or non-intercourse, unless it is im- 
 plied? 
 
 To those who are not carried away by these doctrines, pregnant with so much 
 mischief to this community, it is well worth the trouble to examine the opera- 
 tions of the Government under every administration. They will be able to as- 
 certain the opinions of men of every party manifested by their public acts, as 
 lo the extent of the means confided to us to give effect to the delegated pow- 
 ers. And this inquiry will, I am persuaded, tend to confirm the construc- 
 tion which I have attempted to give to the constitution. 
 
 By the constitution, a judicial department, with limited jurisdiction, is es- 
 tablished, to give effect to the due administration of justice, so far as it is con- 
 fided to the Government of the United States. Congress have made provi- 
 sion for the punishment of perjury, bribery, stealing or falsifying records, res- 
 cue, opposition to the execution of judicial process, and other offences. It 
 
ON THE BILL TO RENEW THE CHARTER OF 1791, 
 
 does not appear that the particular definition to these crimes and the punish- 
 ment designated are " absolutely necessary." Some other means, perhaps, 
 more conducive to the end, might have been employed : and, indeed, it might 
 be said, that, AS Congress, by the constitution, are authorized to " define and 
 punish" certain crimes, it implied a negative to define and punish any other, 
 and consequently those, just mentioned. But can it be necessary to waste the 
 time, or insult the good sense of this House, to attempt to prove, that, in these 
 cases, Congress exercised their constitutional power only? 
 
 The power to borrow money, on the credit of the United States, has been ex- 
 ercised by authorizing the commissioners of the sinking fund to issue certifi- 
 cates, pledging the public faith to pay so much money as therein stated, to be 
 sold in the market for what they could bring. 
 
 To give effect to the revenue system of the United States, Congress have 
 employed means, which, instead of appearing "absolutely necessary," have a 
 very remote connexion with the object; besides the many penalties and for- 
 feitures which are created, the citizen is subjected to the more arbitrary 
 searches and seizures dependent upon the mere will of the collector; yet, the 
 authority to do this has never been questioned. Under the power to regulate 
 commerce. Congress have erected light houses, beacons, and buoysj they have 
 established rules for the regulation and government of the seamen in the mer- 
 chant service; they have adopted measures for their protection on the high 
 seas, and in foreign countries^ they have imposed a tax to be exacted from 
 them, even when abroad, to raise a fund for the sick and disabled: they have 
 established in this country, within the jurisdiction of the State authorities, and 
 without their consent, hospitals for their reception and support. How remote- 
 ly connected are all these things with the primary power " to regulate com- 
 merce?" Are they " absolutely necessary" to give effect to that power? Or, 
 can it be pretended that th erection of a hospital is more immediately con- 
 nected with the regulation of commerce than a bank is with the various fiscal 
 operations of the Government? After having pne thus far, let me ask every 
 rational man, could Congress not incorporate the trustees of such an hospital, 
 with a view to give them individuality, the better to enable them to preserve 
 the funds, and administer the concerns of the institution? Unless there is 
 something magical in the word " corporation," it appears to me there can be 
 no doubt on the subject. 
 
 That Congress have the right to create corporations, as instrumental to ef- 
 fect objects confided to them, seems to me susceptible of the clearest demon- 
 stration. For example: The power "to regulate commerce" includes the 
 power to " promote it by all possible means." Suppose a new branch of com- 
 merce should rise into view, which promised great national advantages, but 
 its commencement was surrounded with difficulties, and required resources to 
 which individual enterprise and capital were incompetent will it be contend- 
 ed that the power which erected hospitals to nurse seamen, because it may 
 have a favorable effect on commerce, cannot incorporate a company with cer- 
 tain privileges, so that, while the means of many are united, they can act as 
 one. in promoting the same object? As to monopolies, of which much has been 
 said, though I am not a friend to them, yet circumstances may exist in which 
 the interests of the community will be promoted in granting some, if prudent- 
 ly regulated; and, therefore, the power ought to exist. Under the power 
 to regulate trade with the Indian tribes, Congress have adopted a system 
 which, though not a monopoly in name, is one in reality. They have esta- 
 blished trading houses on their own account, and under the severest penalties 
 prohibited every person from trading with the Indians without a licence 
 from the public superintendent. What is this but a monopoly, an exclusive 
 privilege, vested in the Government and persons licenced? And in what do 
 these licences differ in effect from the privileges granted by the incorporation 
 of a commercial company? 
 
 By the laws establishing post offices and post roads, various offences have 
 been created, and severe punishments directed, affecting those not in the ser- 
 vice of the Government; persons have been exempted from serving in the mi- 
 31 
 
242 BANK OF THE UNITED STATES. 
 
 litia and on juries, who, by the laws of the States, are expressly subject to that 
 service; this is a direct interference with the State authorities, yet its consti- 
 tutionality has never been questioned. 
 
 The constitution empowers Congress " to declare war," but no express au- 
 thority is given to preserve peace; yet, can it be doubted that the power to ef- 
 fect that object is implied? With a view to it, Congress have passed laws 
 making it criminal to set on foot any enterprise against any foreign nation with 
 whom the United States are in a state of amity, or to hunt upon the lands be- 
 longing to the Indian tribes. 
 
 Congress have power to call out the militia to repel invasions. An in- 
 vasion I understand to mean a military force actually in our territory; yet, an 
 authority has been given to the President to call forth the mititia in case there 
 shall " be imminent danger of invasion*," with a view to prevent it. 
 
 The last instance which I shall give, showing the extent to which Congress 
 have conceived their powers reached, is the purchase of the public library. I 
 would ask the sticklers for express powers, where they find the authority for 
 this act? Sir, taking a detached view of the subject, it might be said that we 
 have the same right to purchase houses for our accommodation. The act can 
 only be justified by reasonings apparently remote from the object. To us are 
 committed the great concerns of this nation. It is our duty to be wel 1 inform- 
 ed upon every subject that comes before us; in order, therefore, to be able to 
 get all requisite information, we think a library necessary as one of the 
 means. This course of argument at once proves every thing for which I con- 
 tend. 
 
 Such, sir, has been the uniform practical construction of the powers confi- 
 ded to this Government, by men of every political description. Sir, the prin- 
 ciples upon which the constitutionality of this question rests, have not only 
 been recognised, in every shape, but the measure itself has received the 
 sanction of acquiescence, if not of approbation, for twenty years. Although 
 I do not feel precluded from thinking and acting for myself, yet, fallible as I 
 know myself to be, I am induced to have great respect for the acts of eminent 
 men, whose wisdom and patriotism it would be vain i 1 '. me to pretend to rival. 
 And believing, as I do, that, among the greatest evils which attend republics, 
 are the instability of public counsels, and the want of character and consist- 
 ency in public 'measures, I feel it a portion of my duty to entertain some 
 veneration for the acts of my predecessors, supportecl by time; at least so far 
 as not to dissent from them, unless they appear to me palpably improper. 
 
 When the bank was incorporated , the People of the United States, with one 
 consent, acquiesced; not a single murmur was heard; not a singje petition was 
 laid upon your table alleging its unconstitutionally, and praying its repeal. 
 Was the patriotism of the community then asleep? Were ihey less sensible, 
 then, of the necessity of preserving the great charter of their rights free from 
 violation, or less acute in their perception of its infraction, than we are now? 
 Was it left for the Argus eyes of the present generation to discover the deadly 
 powers of this Hydra; and to their prowess to rise and strangle it? Sir, f 
 should reason differently. Believing that there was as much intelligence, as 
 much vigilance and patriotism, in the country, then, as there are noYs I am 
 inclined to think that, had there been real cause of alarm, it would, according 
 to the usual course of things, have been manifested when the subject was new; 
 and when the public attention was immediately directed to it. 
 
 Since the establishment of the bank, several laws have passed for the 
 punishment of frauds in counterfeiting their notes one of them under tho 
 late administration. If the incorporation act was unconstitutional, could any 
 person be punished for counterfeiting the notes of the. bank? A person ac- 
 cused must be indicted for having made or counterfeited a note or notes pur- 
 porting to be the act of the president and directors of the bank. If the law is 
 unconstitutional, then, in legal construction, there are no sueh persons; and 
 as well might the accused be convicted of forging a note on some fictitious 
 person, as the note of a bank when none such existed. How has it happened 
 that, in all the trials which have taken place, this ingenious discovery has 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 243 
 
 never been made? The counsel, always sufficiently vigilant in the cause in 
 which they are engaged, have never pretended to question the legal existence 
 of the bank, involved in the constitutionality of the incorporation act. The 
 courts, composed of the most enlightened men, and of different political par- 
 ties, sworn to support the constitution, have consigned the reputations of men 
 to lasting disgrace, and incarcerated them within the confines of loathsome 
 prisons, where they have been suffered to remain for years; when a single 
 breath from the Executive would have released them, which it was his boun- 
 <len duty to do, had the act been considered as unconstitutional. 
 
 Many of the public acts of the Government might be cited to prove the 
 frequent and uniform recognition of the validity of the incorporation; out I will 
 not fatigue the House with mentioning but one other. As recently as the ex- 
 tta session in 1809, you authorized the commissioners of the sinking fund to 
 borrow money from the Bank of the United States, on the credit ot the Go- 
 vernment. If the incorporation is invalid, then there is no corporate capacity 
 in the president and directors, and they have no power to make a contract to 
 Joan the money of the stockholders. 
 
 The necesritytfa bank to canyon the operations of the Government, seems 
 to have been admitted by all who have spoken in opposition to the bill on your 
 table. But they have insisted thai a Hank created by the United Stales is not 
 necessary, because the State banks will afford us the same conveniences. 
 This admission, in my humble conception, completely surrenders the question. 
 If a bank is nerrssn > ;* ///.s7/v///f/f/W to give effect to our fiscal concerns, 
 ought it not to be completely under our direction? Is the instrument to go- 
 vern the hand that employs it, or ihe h:>ud ihe instrument? The State banks 
 arc under the conirol of ihe Suite authorities, who may permit them to ac- 
 commodate us or not, as they please. Can it be seriously conceived that this is 
 ihekiiid oi' government the People intended to establish for the great concerns 
 of this Union, which is to be dependent on the States for the execution of its 
 power? it might as well be contended that v\ e have no right to appoint the 
 collectors of our revenue, because those appointed by the States to collect 
 their taxes would answer all the purposes necessary. 
 
 But the honorable member from New York ( Mr. PORTER) has said that there 
 is nothing new in the doctrine that we should be dependent on the States for 
 the execution of our measures, because the same principle appears on the face 
 of the constitution, that the agency of the States is requisite in the election of 
 senators, representatives, and electors. Was this argument even apposite, 
 I should suppose it a correct answer to say, that the intention of those who in- 
 stituted the Government was to confine the agency of the States to the cases 
 expressly staled; and the present not being one of them, our own discretion 
 was alone to be consulted, and our means employed. But the argument has 
 no connexion with the subject. We are dependent upon the States and the 
 people for the organization of the Government; but whenever it is organized, 
 we are dependent upon our own means to give effect to our powers. As well 
 might the honorable member have contended that we are dependent on the 
 sheriffs of Virginia, who hold the elections, and make the returns, and without 
 whose agency no representation could exist from that State on this floor. 
 
 The argument which admits the necessity of a bank for the purposes of this Go- 
 vernment, but which contests our right to create one, because that necessity is 
 supplied by the State institutions, leads to the very extraordinary conclusion, 
 that what is unconstitutional to day may be constitutional to-morrow. If the 
 States should abolish their banks, or prohibit them from accommodating us, we 
 would have the right to erect them ourselves: butsolongas that is not the case, we 
 have not the power. Can any thing show in a stronger light the untenable posi- 
 tion which gentlemen occupy, than the necessity which compels them to advance 
 arguments which will make this constitution '(intended as the strong bond of 
 union, the same at all times and under all circumstances) a flexible instrument 
 to be contracted or extended, to be feeble or strong, as the caprice of State pow- 
 er may direct? Call this what you will, sir, it is in reality nothing more than 
 the old debilitated miserable system of the confederation. That a bank is ne- 
 
244 B * NK OF THE UNITED STATES. 
 
 cessary for the administration of the national finances, is not only admitted by 
 the opponents of this bill, but tested and confirmed by the experience of other 
 countries as well as our own. Does the Secretary ot the Treasury, in his re- 
 ports on this subject, propose to manage our money concerns without the aid 
 of any bank, in the event of a dissolution of the Bank of the United States? 
 Such an idea has not entered into his imagination, or that of any other man 
 who has the most distant pretensions to any practical knowledge on this sub- 
 ject. Sir, it is the instrumentality of the State banks that must, and is con- 
 templated to be resorted to in that event; and the Secretary speaks and write* 
 of the subject in that way. That a bank 'is" absolutely necessary" I will not 
 pretend to say. There is scarcely any thing effected by human power where 
 there is a physical impossibility to do it but in one way, or but by a single 
 mean. The necessity of which 1 speak is this: that it is more convenient, 
 more prompt, more certain, and less expensive, than any system that can be 
 substituted, to collect our revenue; to safely keep our money; to pay our debts? 
 to support our armies and navies; and, in fact, to give effect to every operation 
 in which money is concerned. Sir, even the inconvenience arising from the 
 expense and hazard of transmitting large sums of money to distant parts of 
 the Union, when the military or other concerns of the Government require it r 
 is very considerable. Through the agency of the bank it is done without one 
 single cent expense, and without any risk to the United States. The instru- 
 mentality of a bank was deemed proper at a time when the fiscal concerns of 
 this Government were comparatively but very limited. Congress, under the 
 confederation, found it necessary to have the aid of such an institution, not- 
 withstanding they had not the power to '* lay and collect taxes," and that ne- 
 cessity gave birth to the Bank of North America. 
 
 From the principles for which 1 contend, and the uniform practice of the 
 Government, this inference is deducible; that, wherever a power is given to 
 do an act, or to legislate upon a subject, all the means, whether remote or di- 
 rect, to accomplish the object, in any manner deemed best, accompany the 
 grant. If this be correct, have not Congress the right, under the power to 
 44 borrow money," to adopt precautionary measures, so that the capacity to 
 7<??it/ may exist, when the necessity in borrow requires it? "To borrow" sums 
 of sufficent magnitude for the exigencies of the Government, in a country 
 where there is very little capital free from employment in the ordinary pur- 
 suits of life, may be very difficult,, unless the small surplusses, scattered 
 through every part r can be united. This tendency banking institutions have, 
 in an eminent degree. Under the power to 44 regulate commerce/' Congress 
 have cherished and protected those whose labor contributed to its sticcess, 
 Under the power to regulate trade with the Indian tribes, they have furnish- 
 ed all the means to carry on that trade; and why not, under the power to 
 " borrow money," incorporate a bank, which, while it creates the ability, on 
 the part of the institution, to loan, by uniting the funds of many, may be so 
 modified, as the bill on your table, as to make it a condition that they shall 
 do so, when the necessities of the Government require it? 
 
 Sir, of the effects which the dissolution of the Bank of the United States 
 will have on the community, I am, perhaps, incapable of forming a correct 
 judgment, as I do not profess to have any very extensive practical knowledge 
 ot banking. But it appears- to me, without resorting to any artificial means, 
 judging only by the rules of common sense,, that they must be very serious* 
 and even calamitous. In a society like ours, comparatively yet in its infant 
 state, I presume it cannot be asserted, with the appearance of truth, that there 
 is a greater floating capital, or a greater portion of circulating medium, than 
 its necessities require. Withdrawing, then, from public use, fifteen millions 
 of dollars,, at least one -third of the \yhole money capital of the United States, 
 (which it matters not whether it is in specie, or par;er answering the pur- 
 poses of specie) must be felt as a very great inconvenience. The products of 
 the country must diminish in price, because their value, according to the 
 present standard, will be much greater than the amount of money to pur- 
 chase. One of two things seems to be inevitable, either that a great portion. 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 45 
 
 of the domestic produce will be inactive on our hands, or that the whole will 
 sink in value to a level with the amount of money to purchase. 
 
 The merchants will more immediately feel the baneful effects of the disso- 
 lution of the bank. Their situation is, at this time, peculiarly embarrassing. 
 Their property, to a very large amount, has been confiscated, sequestered, or 
 detained tor adjudication in Europe, in consequence of the nefarious measures 
 adopted by foreign Pow r ers against our commerce; and a great portion is lyin^ 
 inactive in their warehouses, for the want of a safe market to which to send 
 it. Having failed in receiving their expected means by remittances from 
 abroad, to enable them to comply with their engagements, they require, more 
 than ever, the accommodation which banks can only afford. Disappointed in 
 that, ruin must stare them in the face, though they may be abundantly solvent; 
 a general, if not a universal bankruptcy will ensue, which, while it falls im- 
 mediately on the mercantile classes, ultimately affects every department of 
 society. For nothing is more obvious (I wish it was better understood) than 
 that the affairs of this community arc so closely interwoven, that no material 
 injury can be done to any one great national pursuit, without finally affecting 
 every other. From this impending ruin, some may fly for shelter to the mo- 
 ney capitalists who reserve their means to prey on the misfortunes and ca- 
 lamities of their country, and borrow at exorbitant premiums; but, though 
 this may parry the evil, it is calculated to make it the more certain. 
 
 But, we are told that the wants of the merchants can, and will be supplied 
 by the other banks. It maybe so; but, reasoning as t must, without the aid 
 of the mysterious elements of logic, (for they are perfectly so to me) resorted 
 to by those who pretend to practical knowledge; guided only by the rules of 
 common sense, I should come to a different conclusion. I should suppose, 
 that, in the present difficult and embarrassed state of eur commerce, the 
 whole banking capital in the United Sfntes is scarcely competent to supply 
 the necessities of the country: that, withdrawing more than one-third, must 
 leave a great deficiency, which will not only have the effect of leaving those, 
 accustomed to be accommodated by the Bank of the United States and its 
 branches, without any accommodation, but tend to diminish the discounts of 
 the other banks. Sir, this result is very obvious. The great capital, large 
 depositcs, extensive credit, and circulation of its paper, enabled the Bank of 
 the United States and its branches, from time to time, in the usual course of 
 business, to iiave considerable claims on the other banks, as balances arising 
 from the intercourse between them: which, in ordinary times, under the in- 
 fluence oi an accommodating spirit, ;ire either not rigorously exacted, or re- 
 ceived in paper. But, when the amirs of this institution are to be finally 
 closed, those balances must be paid in specie, and the specie of the other 
 banks will, of course, diminish; they must, then, either curtail their discounts, 
 or hazard their credit, by leaving a surplus of paper in circulation, beyond the 
 usual mean** to redeem it; even the suspicion of which, prudent and experien- 
 ced men will never encounter. 
 
 Against the Bank of the United States, prejudices have been excited and 
 clamors raised, in every shape and in every tone. It has been said to be a 
 deadly viper lodged in our bosom, which, at some time, if suffered to live, 
 will sting us to the heart; fancy has converted it into a political engine which 
 will subvert our liberties: an association of men who will prostrate our Go- 
 vernment. Sir, had I nothing to direct but my imagination, I might, perhaps, 
 be drawn into this vortex of terror; but there is a much safer guide at hand. 
 These dreadful apprehensions have already been exposed, by the honorable 
 member from Kentucky, (Mr. M'KEE) who so eloquently, the other day, re- 
 ferred to the experience of the country, as a conclusive answer. It is the best 
 test of the effect of an institution. I would not give one single year's expe- 
 rience for all the speculations of all the philosophers and politicians that ever 
 existed; by its salutary precepts. let the present question be judged. It will 
 be seen that this pretended viper is an harmless animal; that ourliberties and 
 our Government have been preserved, and ou r prosperity has increased, amidst 
 the operations of this fancied dreadful engine. Sir, it will be further seen, 
 
246 BANK OF THE UNITED STATES. 
 
 that the bank, with all its influence in favor of the men formerly in power, 
 could not avert the change which took place in the public councils of this 
 country. After all this, let me ask every rational man, what danger is to be 
 apprehended from their opposition to the Government, when their aid and 
 their friendship produced so little effect? The fact is, that, practically, the 
 bank must always be friendly to the Government, whatever may be the ab- 
 stract opinions of the individuals composing the stockholders. 
 
 Some of the arguments (or rather assertions) which have been uttered on 
 this floor arc strangely inconsistent. At one time it is said that the capital of 
 this bank is mostly the property of foreign stockholders, who thus have im- 
 proper influence in this country, which ought to be destroyed by putting down 
 the bank. When it is stated by the friends of this bill that it will be a great 
 public inconvenience that upwards of seven millions of dollars in specie should 
 be taken out of the country so suddenly, the same gentlemen tell us, that that 
 will not be the case, for that the foreign stockholders will vest their money in 
 other banks in the United States. Is this the way by which we are to get 
 clear of foreign influence, by driving it from its present confined situation, that 
 it may be infused into every concern in this country, and corrupt every part of 
 the body politic? Foreign stockholders either have undue and improper in- 
 fluence, injurious to our welfare, or they have not; if not, why this clamor, un- 
 supported by any real danger? If they have, is it not augmenting the evil by 
 extending the circle of its operations? 
 
 So much has been said about the improper influence which foreigners have 
 in our country, on account of their being stockholders of this bank, that it mer- 
 its a more minute inquiry; directed, not by prejudice, but by common sense, 
 and governed, not by assertion, but by fact. On looking into the act incorpo- 
 rating the bank, I discover that no person but a citizen of the United States 
 can be a director; that foreign stockholders have no right to vote, either in per- 
 
 their interest committed to the care and control of our Government and our 
 citizens, and, so long as men feel an affection for their interest, so long some- 
 thing like influence arising from this circumstance may be expected. 
 
 The mere employment of foreign capital, instead of being an injury, is a real 
 benefit to the country. It implies a want of a domestic capital co-extensive 
 with pur necessities, as it is one of the first axioms in political economy that 
 sufficiently extensive domestic means will exclude the employment of fo- 
 reign; and therefore the existence of a foreign is proof of the deficiency of the 
 domestic capital. If this idea is correct, the beneficial effects are alone ap- 
 parent. The foreign capitalist lends us his money, for which he draws eight 
 per cent, as a dividend, which yields us twelve or fifteen; and the tendency 
 
 JJVt V'X'Uli* Ci.O Ci UJ. V lULV/llVl} TV IUVU 1 \_-J-VlO U.O LVV^lVV^ ^71 IIXIX/V/U* tlllVl tilt- LtllV4.tlIl^ V 
 
 ic has to promote the wealth of the nation may be exemplified by supposing 
 
 'ividual,; ' 
 
 coper obj< 
 ence^to such an individual whether the person loaning was a foreigner or a 
 
 . 1 I If* ! Ijl !! 11" *l 1 I ,!,;! 
 
 y suppo 
 
 the case of an individual, who borrows money at six per cent, which, by ap- 
 plying its use to proper objects, yields him twelve. It would make no differ- 
 
 citizen; he had furnished the means which made him rich, while, without them, 
 he might have remained poor. So it is with this nation; we have grown 
 wealthy from a comparatively poor state; in this change the employment of 
 foreign capital has had great agency. 
 
 It has been alleged against mis bank that it confines its selection of direc- 
 s to one political party, as well as its accommodations. As to the political 
 complexion of those who manage the concerns of this institution, I have no 
 personal knowlege; the fact may be as stated. Without approving of this 
 course, which 1 by no means do, I conceive that, in all money associations, 
 those interested may safely be trusted to manage *' their own affairs in their 
 own way." The statement that the bank confines its benefits to its own par- 
 ty, if true, certainly shows intolerance, and would be with me highly objec- 
 tionable. But I have great reasons to doubt the fact. I have been told 
 by one of the directors of the office of discount and deposite at Baltimore, 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 47 
 
 that more, than one half of the amount of discounts was granted there to per- 
 sons of opposite political sentiments from the direction; and as nothing but 
 suspicion and surmise have been offered in support of the imputation, I am 
 induced to believe that, .as it respects other places, it is equally unfounded. 
 These things, however, if even true, would have no effect on my vote on the 
 present question: lor, if the objections are valid, they affect not the principles 
 of the institution, but its management. 
 
 I have detained you longerlhan I intended; my apology for occupying so 
 much of your time must be found in the great interest which tins question is 
 calculated to excite; a question on which 1 confess my opinion heretofore in- 
 clined the other way; it was, however, like many opinions, formed without a 
 thorough investigation of the subject. 
 
 Permit me, in conclusion, once more to direct your attention to a subject of 
 the first importance, on which 1 have already made some remarks 1 mean 
 the partialities which have been manifested for State rights and State preten-t 
 sions. This subject has been presented to us in the most lively and interest- 
 ing colors. To pass the bill on your table, has been deprecated as leading to 
 collisions with the State authorities, to discord, and civil war. Sir, if we have 
 armed at that point when it becomes necessary to inquire what will please 
 the States, and what acts they will permit, instead of what is right, then, in- 
 deed, are our proceedings (and even is our existence) a miserable mockery. 
 If we cannot be permitted to think for ourselves, it is much better to close 
 our doors and go home'. IT we cannot act independently, but only in the 
 diameter of humble instruments, to register the will of others, let us not act 
 at all. 1 conceive it a duty equally imperious, from which I have taken a 
 solemn oath not to depart, to oppose the encroachments of the States, as I do 
 not to encroach on them. (I is as essential that \ve should exercise the pow- 
 ers confided io us. uninfluenced by them, as it is that they should exercise 
 those reserved to them, without being inlluenced by us. 
 
 If it is seriously wished thur this (Government and this Union should be 
 pre<<TVi'd, it is time that the -pint of encroachment and control, assumed by 
 some of the States, should be discouraged. If it is suffered to gain strength 
 by our compliance or acquiescence, it will ultimately subvert that liberty and 
 independence purchased by the blood of our best patriots. Here is indeed a 
 viper, (much more deadlyjhan the one fancied by the honorable member from 
 New York Mr. PORTER) which, if you do not expel it from your bosom, will 
 surely sting you to the heart sling you to death. The experience of the two 
 or three last years sanctions the apprehension that the seeds of disunion will 
 be town by the State authorities. There is no well grounded fear that any 
 encroachments by us on the Slates can ever be successful; they have many 
 means to resist them; they who administer the State Governments are com- 
 paratively numerous, and dispersed through every part of the community; 
 hence they will always be able to collect to themselves and to their measures 
 a greater portion of popularity than we have in our power. The distance of 
 many parts from the operation of this Government, and the nature of our pow- 
 ers, create jealousy. If to these causesare added fear and imbecility on our 
 part, the bonds which unite us must become every day more enfeebled, 
 until this Union shall be destroyed a Union in which is involved every 
 thing dear to freemen, and which, I had fondly hoped, would endure to the enri 
 of time. 
 
 JANUARY 22, 1811. 
 
 Mr. SMILIE presented to the House a resolution of the Legislature of the 
 State of Pennsylvania, instructing their Senators, and requesting their Re- 
 presentatives in the Congress of the United States, to use every exertion in 
 their power to prevent the charter of the Bank of the United States from be- 
 ing renewed, or any other bank from being chartered bv Congress, designed 
 to nave operation within the jurisdiction otany State, without nrst having ob- 
 tained the consent of the Legislature of such State; which was read, and or- 
 dered to lie on the table. 
 
248 BANK OF THE UNITED STATES. 
 
 JANUARY 23, 1811. 
 Same question depending. 
 
 Mr. GARLAND said he was sensible of the anxiety of the House on all sides 
 to take this question, and it was with extreme reluctance that he now tres- 
 passed on any portion of their time; but, as he should probably, on this ques- 
 tion, give a vote different from that of most of his colleagues, and many of his 
 political friends with whom he had been accustomed to act, he trusted that he 
 should stand excused for the small portion of time that he designed to oc- 
 cupy. In the view (said he) which I intend to take of this subject, it is not 
 my intention to go into a critical examination of the constitutional ground on 
 which it is conceived this subject rests- I am willing to believe that those 
 who made the constitution understood it in all its bearings, and the spirit in 
 which it was adopted; and as many of the persons who were members of the 
 convention were in Congress in 1791, when the charter of the Bank of the 
 United States was granted, I cannot be so uncharitable as to believe that they 
 would have been the first to violate its sacred principles. I am willing to be- 
 lieve that they possessed as much understanding and patriotism as we do, and 
 therefore believe that they would not have been the first to violate the sacred 
 principles of that instrument. In this opinion I am strongly supported by the 
 conduct of the different States, the most of whom have passed laws for pun- 
 ishing, and have consigned to imprisonment, the counterfeiters of the notes of 
 this bank. I presume it will not now be contended that all the States have united 
 in carrying into execution an unconstitutional law, and that the. United States 
 have at different times, and under different administrations, recognised its le- 
 gality and enforced its principles for nearly twenty years. It does appear to 
 me, Mr. Speaker, that the uniform acquiescence of the country in a measure 
 for such a length of time should put tin- constitutional question at rest; and, for 
 the sake of something like stability in our proceedings, this should be consi- 
 dered as an adjudicated case, in which the law and constitution seem, to have 
 been settled by universal consent. But, Mr. Speaker, I will call your atten- 
 tion for a single moment to the eighth section of the first article of the consti- 
 tution of the United States. It wdl there be found that "Congress shall have 
 power to lay and collect taxes, duties, imposts, and excises, to pay the debts 
 and provide for the general welfare of the United States, and to pass all laws 
 which are necessary and proper for carrying the foregoing powers into execu- 
 tion." I shall attempt to show, from this clause in the constitution, that Con- 
 gress have ample power to pass the bill for extending the charter of the 
 United States' Bank, and this I expect to do without calling in the aid of the 
 general grant of powers as contained in the constitution, from which some 
 gentlemen seem to turn with such disgust; and in discussing this point I shall 
 attempt to reason on things as they now exist. Congress have imposed duties 
 and imposts, \vhich, from their nature, must be collected in the different States. 
 Then, connected with the right of laying is the right of collecting, and with 
 the right of collecting is that of deposite and transmission, in that manner 
 which is best calculated to carry on the fiscal operations of the Government; 
 and the proper inquiry for this House is, How can these objects be best effect- 
 ed? Will not a bank be most desirable, on many accounts, and one, the paper 
 of which shall be known and well circulated throughout the United States? 
 This bank will receive your money, and transmit it to any part of the United 
 States where it may be wanted, at the risk and expense of the bank. By this 
 means the expense of collection will be lessened, and the money transmitted 
 to any part of the United States, so as to enable the Government to pay the 
 debts and provide for the general welfare. In this point of view I consider 
 the bank necessary and proper; and if it be necessary and proper, then the 
 plain language of the constitution is satisfied, and is not made to depend on 
 being absolutely necessary, as gentlemen seem to argue. And whether this is 
 done by one individual, or by incorporating a number of individuals, is not 
 material on the present question, only as it relates to effecting the object, and 
 that will be best effected by the incorporation of a number of individuals, ex- 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 249 
 
 tending their offices of discount and deposite from one end of the United States 
 to the other, all linked together by common interest and duty. 
 
 But some gentlemen say that this will be a corporation, and that all corpo- 
 rations are anti-republican. This is a naked assertion, and is unsupported by 
 any kind of evidence; the propriety of granting acts of incorporation is made 
 to depend on the object to be accomplished thereby; and, to my view, repub- 
 licanism has nothing to do with the present question; this is only the means 
 necessary to carry into effect one of the specific grants of power contained in 
 the constitution. But it h;is often appeared to me that the word republican- 
 ism is used in this House as a kind of watch-word, without any appropriate 
 meaning or application to the subject under consideration; and in this case 
 it seems to be addressed to the feelings of members more than to their judg- 
 ment. But, sir, will it be said that, to collect and transmit the revenue of the 
 United States free of expense, is an anti-republican measure ? I presume 
 not. Is any man's rights invaded, or are the great principles of equal liberty 
 destroyed? I presume not. Then what can republicanism or anti-republican- 
 ism have to do with the piesent question ? It does appear to me that it can 
 have nothing. 
 
 Bui, gentlemen say they can furnish us with a substitute to carry on the fis- 
 cal operations of Government; and what is that? One gentleman tells us, to 
 collect the revenue in specie, and ship it c and another tells us that 
 
 {he State bank paper will answer all the purposes of the Government, and that 
 the State banks will b;* safe places of deposite for your revenue. But, have not 
 Hu-s,' '-i.'tiiiemen furnished you with strong arguments against both of these 
 plans? They tell you thai you need not be under any apprehension of the 
 specie being carried out of the country; that the. risk would be so great, that 
 no man in i. i would attempt it; and, notwithstanding, they recommend 
 
 it to this House as a course to !>e ; Qrovernntent. They also tell 
 
 you that State banks are not ' ed: that they carry on a kind of licens- 
 
 ed fraud, and issue their notes ioa largi- am-Hin.', without having any specie in 
 their vaults. If this be true, then I presume that they would be very impro- 
 per places for tho reception and safe keeping of the public, revenue, and there- 
 tore should noi ben-sorted :>. An;l ihis is not the only objection to State 
 banks; their paper will not circulate generally throughout the United States^ 
 there will be a different value stamped upon it in different parts of the coun- 
 try, and it mighr well b refused by the creditors of the Government. In ad- 
 dition to this, they do not form and keep up that chain ot connexion through- 
 out the United States that would enable them to transmit the money to such 
 places as the demands on the Government might require. 
 
 Then, Mr. Speaker, if the Bank of the United States shall be put down, (a 
 measure wlikh I consider almost certain) your revenue will be payable in 
 specie, and nothing else can bj received, agreeable to the existing laws of the 
 land. And have gentlemen given themselves time to consider where this spe- 
 cie is to come from ? Have they relief ted that, from the best data on which we 
 can form a calculation, there are less than twenty, millions of dollars in actual 
 specie in the United Stales? a sum not more than sufficient to meet the de- 
 mands of the Government, inoneyear of commercial prosperity, even if it was 
 in your power to unlock the chest of every miser, and to bring into circulation 
 every cent of actual specie now in the United States. And this, you well 
 know, will not be in your power. And was it in your power to bring into the 
 treasury ot the United States the whole amount of specie now in the country, 
 and in that way were you able to discharge the demands of the Government 
 for one year, what will then be left to give currency to the bank paper, as a 
 circulating medium in the country ? To give currency to bank paper, it must 
 carry with it a belief (at least) that there is, in the vaults of the bank from 
 which the paper issues, a sufficiency of actual specie to render to you a dollar 
 in specie for every dollar in paper which you return them. But, Mr. Speak- 
 er, this impression cannot be made in the present state of things. It will very 
 soon be known that the treasury of the United States has gathered into its 
 vaults all the actual specie in the country. This being the case, there can be 
 
250 HANK OF THE UNITED STATES. 
 
 no specie in the vaults of the bank. Of course the paper will cease to circulate, 
 or , it' it circulates at all, it will beat a rate below its nominal value. 
 
 .But, sir, will those gentlemen, who advocate the doctrine that State bank 
 paper shall be receivable in discharge of the revenue, tell mewho is to make 
 ^ the selection from amongst the banks whose paper is to be received ? Do they 
 mean to throw the responsibility from their own shoulders on the Secretary of 
 the Treasury, and make him individually liable, in case the bank should fail r 
 I presume not; this would be an unreasonable responsibility; and if this is not 
 the case; the public revenues will be exposed to great risk, and frequent losses 
 will be the certain consequence. In addition to this objection, if the Secreta- 
 ry of the Treasury is to be left at his own discretion to take such State bank 
 paper as may suit his mere will and pleasure, without any individual liability, 
 do you not at once give him a decided control over all the moneyed institutions 
 of the country, and an influence greater than what is possessed by all the rest 
 of the Government besides, and that at the risk of the loss of the revenues of 
 the United States? 1 am willing to admit that I have the highest confidence 
 in the integrity and talents of the present Secretary of the Treasury,, -but we 
 dp not know now long he may hold that office, and we know not who may be 
 his successor; and if there was a certainty that he would continue to adminis- 
 ter the fiscal concerns of the Government, still I contend that it would be un- 
 wise and unsafe to place so much power and influence in the hands of any offi- 
 cer of the Government that is so far removed from the People, and to whom 
 he feels no kind of responsibility. 
 
 But, sir, if the Government refuses to receive State bank paper, as I pre- 
 sume they will, then it must depreciate, and will no longer be a circulating 
 medium in the country at its nominal value. We shall then witness the 
 strange phenomenon of a country, with an export trade worth upwards of 
 seventy millions of dollars annually, without one single cent in circulation 
 that will be a tender in the payment of debts, or receivable in the purchase of 
 produce at its nominal value. How far this will comport with the interest of 
 this nation is for those to determine who preside over its concerns. It has 
 always been my ppinion that the true interest of a nation consisted in her 
 having a circulating medium at least equal to h<3r export trade and one year's 
 revenue; and, if she did not possess that in actual specie, it should be the 
 wisdom of Government to create an artificial capital equal to those objects; 
 and that it should be so secured as to possess the confidence of the nation. 
 Without this circulating medium, the spirit of industry will be checked 
 agriculture will no longer flourish and a universal stoppage of payment must 
 take place. I hope gentlemen will at least take time to reflect before they 
 draw down on their country those direful evils, and will not suffer their minds 
 to be occupied too much by party feelings, which, in my opinion, have nothing 
 to do with the present question. But some gentlemen seem prepared to 
 denounce every man who does not give his negative to the bill under consi- 
 deration. Sir, considerations of this kind will have but little weight with me. 
 I know no party but the People; I know no interest but the public welfare; 
 and I shall on this, and on all other questions which are presented for my 
 decision, give such a vote as in my judgment is best calculated to promote 
 these great objects; and if I err, I shall nave the consolation that I have inde- 
 pendently exercised my best understanding, and that I have not been the 
 blind follower of any political party. 
 
 But, Mr. Speaker, 1 will take gentlemen on their own ground fora moment, 
 and see how this measure will operate. They say that the State banks will 
 go on to issue their paper, and it will continue to circulate as usual; but, sir, 
 let it be recollected that, by the dissolution of the charter of the Bank of tin- 
 United States, about seventeen millions of dollars are at once taken out of 
 circulation, which is equal to one-fifth of all the floating capital of the United 
 States. Then, independent of the individual distress which this must produce, 
 '"' it will reduce the value of all produce and property in market in the propor- 
 tion that the sum taken out of circulation bears to the whole sum now in cir- 
 culation. I presume that such a state of things cannot be desirable: for, 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 251 
 
 although you may by your measures reduce the price of tobacco, flour, hemp, 
 &c. still you will not be able to procure a bushel of salt, or a pound of sugar, 
 for less than what it is now selling for. But my honorable colleague (Mr. 
 BURWELL) seems to think that this would be very desirable. He says it would, 
 reduce the price of labor, and, in that way the farmer and planter would be 
 forced to abandon his agricultural pursuits, and become a laborer in some manu- 
 facturing institution at low wages, and thereby enable the manufacturer of this 
 country to undersell the manufacturer of Europe. To my mind this appears to 
 be a wild theory, at war with the best interests of the conn try, I consider agricul- 
 ture as the fountain of wealth in this country, and commerce and manufactures 
 as the hand maids; and I never can consent to the depression of the former 
 for the benefit of the latter. It would be with extreme regret that 1 should 
 see the independent cultivators of the soil obliged to abandon their (arms and 
 take up their residence in a work shop, and become the dependant of some 
 lordly tyrant, instead of being the independent cultivator of the earth. In 
 addition to this, I have always considered the agriculturist as the best citizen; 
 *fc entertaining more rational ideas of liberty, and being more strongly attached 
 to the independence of his country; and it is on agriculture that we must rely 
 for wealth in time of peace, and plenty in time of war; and it, therefore, has 
 a primary claim on the patronage of Government. 
 
 The gentleman from New York, (Mr. PORTER) has told us, that, inasmuch 
 as the friends of the bill under consideration have relied on different parts 
 of the constitution, therefore, no one part gives us the power. The singularity 
 of this idea is manifested to tin- weakest capacity, and the fair deductions 
 very apparent; I presume that, if the measure can be supported and justified 
 under different views of the constitution, it proves that the measure is abun- 
 dantly justified oil constitutional grounds, and that it is in unision with the 
 general principles of the instrument; and shall we be told, because it has the 
 support of many parts of the constitution, it is weaker than if it had' only 
 oner To exemplify my idea, suppose a proposition in arithmetic, that by 
 many modes of calculating you could arrive at the same result, would it be 
 said that this was less true than where you could only come at the result in 
 one particular way? I presume not. But, Mr. Speaker, if any measure 
 could derive strength from the inconsistency of its advocates or opponents, 
 then, sir, I am persuaded that the opponents of the bill have done as much in 
 its favor as its friends have against it. I beg y.ni, sir, to recollect the different 
 grounds on which the opposition have relied. Some gentlemen are opposed 
 on constitutional grounds; some gentlemen are opp-jsed because* they are 
 afraid the bank will coalesce with the Government, and overturn the liberty 
 of the Peopl?: others are opposed because the bank is hostile to the Govern- 
 ment; others are opposed because they want a national bank; and others are 
 opposed because a part of the capital stock is owned by foreigners; and here 
 they attempt to awaken all the angry feelings of the nation against the use of 
 foreign capital, while they carefully keep out of view the fact, that a republi- 
 can administration sold to foreigners all the capital which they had in this 
 bank; and thus, by uniting all those heterogeneous objections, a majority is 
 formed in this House opposed to the passage of the bill. But, sir, 1 do not 
 expect to derive any aid from these incoherent objections as giving any support 
 io the bill: for, from the zeal that gentlemen have shewn in their opposi- 
 tion to this bill, it was to be expected that they would touch every string that 
 ivas likely to sound in unison with the feelings of any part of this House. 
 
 Mr. Speaker, I shall pass over many of the minor objections that are made to 
 the passage of the bill now under consideration, and come to the conclusions 
 of the opponents of the measure. They are all obliged to admit that the 
 establishment of such a bank as is contemplated by the bill under considera- 
 tion, would be convenient, and would aid the fiscal operations of the Govern- 
 ment, and say that, if it was the only way in which the finances of the coun- 
 try could be administered, then it would be justifiable. And here, in my 
 opinion, the gentlemen give up the constitutional ground: for, if the measure 
 be necessary and proper to carry into execution any of the specific grants of 
 
252 BANK OF THtt UNITED STATES. 
 
 power contained in the constitution, then the plain language and meaning of 
 that instrument is satisfied, and is not made to depend upon the question, 
 whether there is no other way in which it can be done. 
 
 I have endeavored, Mr. Speaker, to examine this subject with candor, and 
 prepare my mind to decide on it without taking into view the ruin of thou- 
 sands, that must be the certain consequence of withdrawing from circulation 
 at one time, so much of the floating capital of the country. And it does appear 
 to me, in every point of view in which I have been able to examine it, that, at 
 this time, to break in upon the established order of tilings, under which the 
 United States have progressed in wealth and prosperity, unexampled in any 
 preceding twenty years, would be, to say the least of it, a dangerous experi- 
 ment. 
 
 Mr. TALLMADGE said, although the bill now before the House had under- 
 gone a pretty ample discussion; and although he felt almost disqualified from 
 speaking distinctly, from the pressure of a severe cold, yet he could not re- 
 concile it to his sense of duty to permit the question to be taken on the present 
 bill, without submitting a few remarks to the consideration of the House. In 
 doing this, he would endeavor to place the question on its proper basis, di- 
 vested of any extraneous considerations, by the admission of which some gen- 
 tlemen appeared to have lost sight of the true merits of the question. 
 
 Before 1 proceed to discuss the bill now before the House, (said Mr. T.) I 
 take occasion to remark, that some gentlemen appear to entertain very limit- 
 ed, and, in my judgment, very incorrect ideas of banking institutions. From 
 some observations which I have listened to, T should suppose that a bank was 
 considered nothing better than a broker's office, in which Jews and money 
 brokers meet to prey upon the community. Others have compared the in- 
 stitution to Pandortfs box, from which have issued the principal evils which 
 have afflicted this country. Many similar remarks, equally crude and irre- 
 levant, have been submitted by some gentlemen, who wish the dissolution of 
 the Bank of the United States.. For the information of such gentlemen, I 
 take occasion to remark, that the use of banks by the principal commercial 
 nations in the civilized world, stamps a value upon the institution, too broad 
 and too well attested to be questioned at this time. 
 
 The Bank of the United States ? whose corporate existence we are called on 
 to continue, seems to have been instituted principally for two purposes, viz. 
 that of discount and deposite. Under the first, loans and facilities are obtain- 
 ed, both by the Government and individuals: and by the last, corporate bodies 
 and individuals are enabled to lodge their money, or other precious treasures, 
 in the vaults of the bank, for safe-keeping, to be withdrawn at pleasure. 
 
 It will not be a fair course of reasoning to infer, that, because some banks 
 hafe been used for bad purposes, therefore s#must be of pernicious tendency. 
 The abuse of any blessing can never be fairly urged "again&t its use. The great 
 multiplication of banks, by the different .States in the Union, proves the sense 
 which the public entertain of their utility. The Bank of North America, 
 which was incorporated in the year 1780, served greatly to invigorate public 
 credit, and unquestionably shed a salutary influence on the measures of that 
 eventful epoch in our Revolution. But I will not enlarge on this point, pre 
 sinning that few can be found within the sound of my voice, who will question 
 the utility of the Bank of the United States. 
 
 The remarks which I propose to submit, will be comprised under the two 
 following general heads: 
 
 I. Has Congress a constitutional power to renew the present charter of the 
 Bank of the United States? 
 
 II. Is it expedient, at this time, to permit its charter to expire? 
 
 That the field of controversy may be narrowed as much as possible, it may 
 not be improper to consider the points in which all agree; and, also, the most 
 prominent subjects of debate. I, therefore, consider the three following 
 points as agreed to by the friends, as well as the enemies, of the present bilk 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 253 
 
 1. That Congress have the constitutional power to make all laws neci- 
 to carry into execution the constitution of the United States. 
 
 2. That banks are among the necessary means to enable the Government 
 to carry on its fiscal arrangements. 
 
 3. That no positive injustice can be chargeable upon the Government, even 
 if it should refuse to renew the charter of the bank, inasmuch as it will expire 
 by its own limitation. 
 
 The points in controversy between us are the three following: 
 1. The opposes of the bill on your table as*ert, that, to renew the char- 
 ter of the Bank of the United States, Congress must assume a power not war- 
 ranted by the constitution. 
 
 To this doctrine I enter my solemn protest. 
 
 2. They further assert, that the State banks are competent to answer all the 
 demands of the General Government in their fiscal operations. 
 
 This doctrine I can. by no means, admit. 
 
 3. It has also been asserted, that the Bank of the United States originated 
 with a party; that it has been .supported by a party; and must now be decided 
 on party principles. 
 
 The two first parts of this proposition I deny, but fear I shall be constrained 
 to submit to the lasl. 
 
 I come now t> the consideration of the constitutional question, and, inas- 
 much as it embraces consequences very momentous, bath to the General Go- 
 vernment and to our individual citi/.ens, 1 hope this honorable House will hear 
 me with candor. 
 
 The ground taken by the opposerdof the present bill rests upon the tenth 
 article of ihe amendments ID the constitution, which declares that the po\\ers 
 not delegated to Co' ; -ved to she State.-, cic. and hence, an infer- 
 
 ence is drawn, tlial, because no expre-- power can be found delegating the 
 authority to grant incorporations, therefore Congros cannot constitutionally 
 exercise such p.iwrr. The fallacy of this argument may be- shown in num- 
 berless instances, and from every day's experience in legislation. Asu fami- 
 liar instance, I beg leave to inquire, by what express authority in the constitu- 
 tion has the Government any power to establish custom houses, or to appoint. 
 officers for the collection of th ? And yet, the orderly management of 
 
 the Treasury Department so imperiously demands the exercise of this power, 
 that no doubt has ever been entertained *as t;> its constitutionality. 
 
 In defining the powers of Congress, there seems to be a three-fold rule 
 given in the constitution: 
 
 1. Positive as to tlu> power granted. 
 
 2. Negative on the General Government. 
 
 3. Negative on the States. 
 
 If gentlemen will turn to the first article of the constitution, under the 8tli 
 section, they will find the powers enumerated which Congress may exercise. 
 Inasmuch as Congress has the power to lay and collect taxes, duties, imposts, 
 and excises, so it is also provided, "That they may make all laws which may 
 be necessary and proper for carrying into execution the foregoing powers," &c. 
 Here is the basis on which I am willing to rest the argument, that the Legisla- 
 ture of the United States has the right to incorporate a bank for the purpose 
 of collecting, in the most safe and facile manner, the revenues of the country, 
 as well as of disbursing the same with the least expense and inconvenience 
 to the Government, in any part of the United States where the same should 
 be needed. If it should be conceded, that banking institutions are necessary 
 to the convenient and orderly management of our fiscal concerns, (and I flat- 
 ter myself this will not be contested) then shall 1 consider the constitutional 
 question nearly settled, unless it can be proved (hat State banks can be a safe 
 substitute for the Bank of the United States. On this point, I shall have oc- 
 casion to remark hereafter. 
 
 In the ninth section, under the first article of the constitution, the exercise 
 of certain powers is prohibited to the General Government, but nothing can 
 there be found touching the present question. It must, therefore, be included 
 
6 254 ^BANK OF THE UNITED STATES. 
 
 in the amendment before quoted, the explanation already given of which I hope 
 may be satisfactory to this House. 
 
 In the tenth section of the same article, the States are prohibited from exer- 
 cising certain powers. Among other things, they are not permitted " to coin 
 money,- emit bills of credit; make any thing but gold and silver a tender ii 
 payment ot debts," &c. Although I am not disposed, in this place, to con- 
 test the right claimed by the several States to incorporate banks ad libitum, 
 yet 1 have no hesitation in saying, that there appears to be a more literal re- 
 striction on the State authorities to grant charters to banks, than on the Go- 
 vernment ot the United States. This contraction receives additional con- 
 hrmation, when it is remembered that, in some States, bank bills have so far 
 been made a legal tender, as to be receivable for State taxes, &c. The infer- 
 ence from these remarks is simply this, that, as bank bills are a species of bills 
 of credit, the several States cannot constitutionally authorize their emission; 
 and as they are the best representative of gold and silver, Congress alone has 
 the power, under the constitution, to regulate the same. 
 
 In the modern rage for putting down former institutions, we seem to arro- 
 gate to ourselves more wisdom than our predecessors possessed. In the 
 preamble to the act establishing the Bank of the United States, among other 
 reasons assigned for the passage of the law, it was deemed that such an insti- 
 tution "would be conducive to the successful conducting of the national fi- 
 nances; would tend to give facility to the obtaining of loans for the use of the 
 Government, on sudden emergencies, and would be productive of considerable 
 advantages to trade and industry in general." 
 
 If such an institution was necessary for the operation of the Government 
 then, it is riot easy to conceive that it can be less useful now; nor can it be 
 comprehended why a measure should be deemed unconstitutional in the year 
 1811, which, in the y^ear 1791, was pronounced by some of the first sages of 
 our country, with Washington at their head, not only very beneficial to the 
 Government, but strictly constitutional. This argument derives no incon- 
 siderable weight from the circumstance that, under all the successive adminis- 
 trations of our Government, acts have been passed confirmatory of this prin- 
 ciple. The law enacted for the punishment of those who should counterfeit 
 the^ bills issued by this bank, sanctions the original law: and the laws of the 
 different States to the same effect, prove that (hey had no scruples on this 
 point. The loans which have been repeatedly made of this bank, under the 
 sanction of law, greatly corroborate the opinion, that the charter was not 
 deemed unconstitutional, and I presume most of the gentlemen who now ap- 
 pear so scrupulous about violating the constitution, actually voted for the passage 
 of the law of the last session, authorizing the bank to loan several millions of 
 dollars to the Government. Now, if the original law was unconstitutional, 
 the charter is void, and all the operations of the bank must have been illegal. 
 On the same principle, every subsequent law relative to that incorporation 
 must have partaken of its original depravity, being equally unconstitutional. 
 In the year 1801, a law vvas passed authorizing the bank to establish offices 
 of discount and depositc in the territories of the United States; under which 
 law the bank was established at New Orleans, for the accommodation of the 
 Government, and yet no constitutional objection was made to this measure, 
 although the sas;e of Monticello was then President of the United States. 
 
 I cannot dismiss this head of my argument without adverting to the use 
 which some gentlemen have made of the terms power arid means, confound- 
 ing them together, as of synonymous signification, in the present question. If 
 Congress possesses the power of collecting and disposing of the revenue, its 
 wisdom must devise the best means of effecting the object. In this view of 
 the subject, the creation of a bank must be considered among the means ne- 
 ces=ary for the "successful conducting of the national finances." My own 
 judgment has long been settled on the constitutional question, and I cannot 
 but hope that a candid consideration of the views in which I have presented 
 the subject to the House, \yill induce some gentlemen to hesitate, who may 
 have heretofore been fixed in opposition to this bill. 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 I come now to the consideration of the second general head which I pro- 
 posed to discuss, viz. the inexpediency of permitting the present charter to 
 expire. In doing this, I will endeavor briefly to state some of the conse- 
 quences which will probably result from such a measure. 
 
 1st. A general distrust of bank credit must be the inevitable consequence. 
 As soon as the bills issued from the Bank of the United States shall cease 
 to circulate, the holders of other bank paper will become suspicious of their 
 ultimate payment, and, of course, will either refuse to receive them inpay- 
 ment of debts, or will send them to their proper banks to receive specie in 
 exchange for them. As evidence of this, I will state to the House that the 
 mere conjecture that such an event may happen, has already begun the call for 
 gold and silver in exchange for bank bills. 
 
 '2d. Such a measure would be distressing if not destructive to State banks. 
 To prove the truth of this position, I call on gentlemen to examine the report 
 of the Secretary of the Treasury, in which may be seen the amount of notes 
 on hand, issued by the State banks. If these should be presented for pay- 
 ment, nearly the whole of the specie in their vaults would be drawn out, and 
 perhaps some banks might not be able even to meet the demand. The unusual 
 export of dollars from this country, for some years past, and the failure of the 
 accustomed imports, have continued greatly to increase this distress. 
 
 3d. It would be ruinous to individuals. Perhaps a more inauspicious period 
 than the present could not have been selected for thedostruetion ot this moneyed 
 institution. Our mercantile brethren have more than $-20,000,000 locked 
 up at this time in Europe, and unusually large importations ot East and West 
 India produce are on hand for exportation. Accommodations must therefore 
 be obtained, or their credit as well as property must be lost. I beg gentle- 
 men to re-examine the Secretary's report, where will be seen the amount of 
 discounts in our principal commercial towns. 
 
 I then inquire, Mr. Speaker, whether all the specie in the United States 
 is sufficient to pay up the notes which have been discounted by the Bank of 
 the United States, and which are now on hand. If you should oblige them 
 to wind up their concerns on the 3d of March next, they will be constrained 
 to call in their dues, and as no new loans can be made by this institution after 
 their charter shall expire, so the State banks will be constrained to shorten 
 their discounts, lest their debt should be increased to the Bank of the United 
 States by accommodations to her debtors. In this way the distress will be 
 greatly increased, and the State banks, being crippled in their operation, will 
 be unable to afford the needed relief. 
 
 The bills issued by the Bank of the United States, and now in circulation, 
 exceed five millions of dollars. Let this sum be called out of circulation, 
 and the merchant, the farmer, and the mechanic, will sensibly feel its effects. 
 
 4th. If this charter should expire, 1 feel persuaded it must be injurious to 
 the operation of the Government. Of the present regular collection of the 
 revenue I will say nothing; but, of the distribution of this money, I venture to 
 say that no process through the State banks can be so safe or so expeditious. 
 Suppose that the operations of the Government should require the payment 
 of a million of dollars at New Orleans. Through the agency of the United 
 States' Bank, "this deposite and payment could be promptly made; but how 
 could this be effected by any State bank? From the very nature of those 
 institutions, the bills issued by the State banks must have a limited circula- 
 tion, and could not possibly answer on such an emergency. But, if the Go- 
 vernment should suffer no inconvenience from the State bank emissions, mer- 
 cantile men arid private citizens must feel the embarrassment very severely. 
 In addition to these considerations, will it be safe for the Government to en- 
 trust their funds to moneyed institutions, over which they not only have no 
 control, but have not even the power to demand a view of the statement of 
 their business? On this point 1 flatter myself there can be but one opinion: 
 and inasmuch as weekly reports are now made to the Secretary of the Trea- 
 sury, from the Bank ot the United States, the safety of trusting the revonue 
 to this institution, rather than to any other, must be very apparent. 
 
256 BANK OF THE UNITED STATES. 
 
 5th. It is somewhat questionable, in my mind, whether the honor of the 
 Government will be unimpeachable if the charter of the bank should not be 
 renewed. I have said before, that, in point of strict justice, the Government 
 is not bound to re-charter this bank; but, when I recollect that, not many 
 years ago, the Secretary of the Treasury sold all the bank stock belonging to 
 the United States (being 2,220 shares) to foreigners, at a premium of forty -Eve 
 per cent. I cannot reconcile it to my ideas of honorable conduct, to reduce 
 that stock at once to par. By that operation the Government raised the sum 
 of 1,287,600 dollars, making a nett profit to the,, treasury of 399,600 dollars. 
 Jf the average rate of dividends has been about eight and a third per cent, on 
 the nominal capital, it is very manifest that the purchasers of this stock of the 
 Government have not received six per cent, on their money, and all the ad- 
 vance paid on the principal must be lost. From the remarks made by some 
 gentlemen, this argument will probably have but little weight; more especially 
 as the purchasers were Englishmen, But by me the same rule shall be meted 
 out to an Englishman or a Dutchman, to a Frenchman or an American. 
 
 Give me leave, Mr. Speaker, in thisplace to notice a very popular objection 
 to the renewal of this charter, because two-thirds of the stockholders are fo- 
 reigners. Are not the rights of foreigners in our country to be protected as 
 well as those of our own citizens? Is it not enough that, by the act of incor- 
 poration, foreigners are not eligible as directors to manage the funds of this in- 
 stitution? I know it has been urged that foreign capital brought into this coun- 
 try is injurious to the community. With this opinion I do not accord, more 
 especially when placed under the direction and control of our own citizens. 
 But, say some gentlemen, in case of a war this influence might be injurious to 
 our country. I should believe the very reverse would be the fact. If it be true 
 that, where a man's treasure is, there will his heart be also, then surely it might 
 be useful for any country to have the funds of its enemies to use and improve 
 in case of a war. Not only would this serve to keep the true owners of the 
 property from being active against us, but it would also serve as the sinews of 
 war to aid us in the contest. So long as the moneyed capital of our own citi- 
 zens can be better employed, let not the policy of this Government be direct- 
 ed against the introduction of foreign capital into the United States. 
 
 I will conclude my remarks on this subject, Mr. Speaker, by calling the at- 
 tention of this honorable House to a few statements taken from the report of 
 the Secretary of the Treasury, which has been laid on all our tables. From 
 this it appears that the amount of bills and notes discounted, and now on hand, 
 exceeds 14,000,000 of dollars; of which Philadelphia owes about $5,000,000 
 and New York $4,000,000. If these sums should be demanded, is it possible 
 to find the gold and silver in our country to pay them up? Certainly not. 
 What is then to be done? Either the Bank of the United States must extend 
 the times of payment, or the State banks must afford their aid. It is question- 
 able how far it would be safe for the bank to proceed in the first case; and, in 
 the last, it has been shown, that, if the State banks should afford the needed 
 accommodation, their own ruin would be sealed. By a report lately made to 
 the Legislature of Pennsylvania, (which I hold in my hand) it would seem 
 that the amount of all the specie in their State banks did not much exceed 
 1,000,000 of dollars. 
 
 What is the state of the specie capital in the city of New York? If pretty 
 correct information may be relied on, all the State banks in that city cannot 
 produce half a million of dollars. It is then utterly impossible, with all the 
 specie in those two large cities, to pay up the demands of the United States' 
 Bank upon the citizens; and if gentlemen suppose that no distress would en- 
 sue from so sudden a pressure upon the citizens, (hey must have data on which 
 to found an opinion with which I am wholly unacquainted. 
 
 Asa further evidence of the real diminution of specie in our country, I 
 would state that, in January, 1810, there was in the vaults of the bank of the 
 United States and its branches, $9,051,704, and in the December following, 
 there was only 5,482,879; making a diminution, in eleven months, of 3,568,825. 
 In the same month of January, the State banks owed the Bank of the United 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 257 
 
 States $579,653, and in December following, the sum was increased to 
 $1,516,027. If you add the difference (which is near 1,000,000 of dollars) to 
 the amount in the vaults of the United States' Bank and its branches, in Decem- 
 ber, the diminution of specie in about eleven months will be found to be j;botit. 
 $2,600,000. This alarming diminutio ') of the precious metals ought to have 
 some weight with this House in deciding on the present question, that the pres- 
 sure may not be increased upon the community. 
 
 Notwithstanding my full conviction that it will be highly impolitic, as well 
 as peculiarly distressing to the People of the United States, to .reject the bill 
 now before the House, and thereby permit the charter of the bank to expire, 
 yet. I must confess I am not without my fears, that such is to be the fate of this 
 institution. It can never be sufficiently deplored, that the feelings of party 
 should have ever influenced the measures of this Government. v\ hen this 
 prevails, we must expect that rash and impolitic measures will be adopted. 
 On the present occasion, a leading member in opposition to this bill (Mr. 
 KPPKS) has declared his belief, that the bill now under consideration was 
 purely a parly question, and would be decided accordingly. If this is the 
 case/ the fate of the bank is fixed; and on this ground alone can I account 
 for that peculiar apathy and unconcern which is exhibited, when the evils to 
 be apprehended from a non-renewal of the charter have been so forcibly ex- 
 hibited to Congress, in the numerous petitions which have been presented. 
 But when I further reflect, that agents an- known to be within these walls, 
 who are already fattening on the prospect that the State banks which they re- 
 pivM-nt :i iv to receive the deposites of the (Joxvrnment arising from the col- 
 lection of the revenue, 1 fear my feeble attemps to arrest the progress of this 
 desolating spirit will be of no avail. 
 
 Mr. NICHOLS, >v. Mr. Speaker: As 1 shall vote against an indefinite post- 
 ponement of this bill, because I shall vote for the entire bill, when rendered 
 as little liable TO objections as possible, and, as this vote will probably stand 
 at variance with many of those for whose opinions I entertain a high respect, 
 I deem it essential, as well for my own justification, as for the information of 
 others, to state the reasons upon which my vote is to be given. 
 
 The system of banking being an improvement upon the moneyed system, by 
 which commerce, or the exchange of commodities, is carried on, and therefore 
 still more complex in its operations, and more difficult to be understood, has 
 excited the approbation of some, while it has equally excited the prejudices of 
 others. Those, however, who have been best acquainted with its operations, 
 when properly regulated, have, in all countries, united in a general expression 
 of a conviction of its utility, not only as it respects personal convenience, but 
 also as it regards the facility with which the financial affairs of nations can, 
 with its aid, be conducted. 
 
 A- this subject has become quite interesting, it becomes the duty of every 
 one to assist in an endeavor to throw all possible light on the subject, not only 
 as to the constitutionality of this Government legislating upon it, but also as 
 it regards its operations and effects; in order that we may have as dear a view 
 of the whole ground as possible, and thereby be better enabled to judge, with 
 more certainty, of the merits or demerits of the bill now under consideration. 
 I shall, therefore, endeavor to explain my views of the subject, as concisely 
 as possible; and if I shall, in any respect, be found groping in the dark, in 
 the remarks which I shall offer, I trust that an ordinary degree of candor will 
 be sufficient to shield me from the imputation of sinister design. First, then, 
 as to its constitutionality. x 
 
 Perhaps, sir, the doubts entertained by some, of the constitutionality of this 
 bill, arise from an extreme, and, as I conceive, unfounded jealousy, that this 
 Government is calculated gradually- to usurp the powers of the State Govern- 
 ments. This jealousy is a foible with many well-meaning legislators; I how- 
 ever respect it, as I am sensible that it arises from a good motive; and I be- 
 lieve that, it' it be kept within reasonable bounds, it may. at least, be of no dis- 
 tervice in preserving our federative system of government. Probably we, in 
 33 
 
258 BANK OF THE UNITED STATES. 
 
 some measure, derive this jealousy of the exercise of powers from our .ances- 
 tors. The crown, the peerage, and the commons of Great Britain, are three 
 distinct and conflicting- interests: the crown to preserve its prerogatives; the 
 peerage to preserve their privileges,- and the commons topreserve their rights*. 
 if they can. But here, sir, we have neither crown, nor peerage 5 we have no 
 interest but the interest of the commons, or the People. Our General Govern - 
 ment, as well as our respective State Governments, emanate directly from 
 the People; the People have the same control over each; and why xve should 
 be so jealous of the former, and so partial to the latter, seems somewhat diffi- 
 cult to determine. 
 
 When our federal constitution was adopted, the knowledge of u federative 
 system, upon its present plan, was new, and existed merely in theory. The 
 objects, however, intended to be effected by its adoption, are clearly and dis- 
 tinctly set forth in its preamble. They are, " to form a more perfect union^ 
 establish justice, ensure domestic tranquillity, provide for the common de- 
 fence, promote the general welfare, and secure the blessings of liberty," &c. 
 Yet, in the eighth section of the second article of that instrument, which con- 
 tains an enumeration of certain specific powers, there is not the same clear- 
 ness and precision. In the first paragraph of that section, powers are given to 
 Congress to provide for the common defence and general tvelfare of the Unit- 
 ed States; and these powers, which are necessarily unsusceptible of precise 
 definitions, are coupled with others, in the same paragraph, in such manner 
 as to render their meaning doubtful, especially in the minds of those who en- 
 tertain a strong partiality for the powers of the State Governments. The 
 powers of this Government, which arise from the operation of common law,, 
 are still more indefinite, and, in the minds of many, difficult to comprehend. 
 Perhaps, sir, generally speaking, it would not be too much to say, that it must 
 remain for that good sense, which is the offspring of experience and mature 
 deliberation, more than to specific definitions of powers, as set forth in that 
 instrument, to ascertain precisely what powers the General Government 
 ought to possess, and what the States ought, individually, to retain. In form- 
 ing that instrument, no doubt, sir, such powers, if not all necessary powers, 
 won 1 ! intended to be given to this Government, as should be adequate to all 
 the purposes of national sovereignty; that it was not, for want of these essen- 
 tials, to hobble on crutches, through an imperfect state of existence, to pre- 
 mature decay. In short, that it, being like the State Governments, an emana- 
 tion from the People, should be so far self-existent as to depend lor its sup- 
 port on that power only the collected power of the People which first ushered 
 it into existence. In the federative system, which I esteem the perfection of 
 the science of government, the rule to be observed, in the distribution of its 
 powers, between the confederated States and the federal head, is, as I con- 
 ceive, simple and plain. It is this: Can any particular power, which is about 
 to be vested somewhere, be exeicised in local and separate districts or States,. 
 consistently with the safety and good of the whole? If it can, it ought of course 
 to be exercised by the respective State Governments. All other powers, which 
 cannot be thus confided, consistently with the safety and good of the whole, 
 ought to belong to the General Government. 
 
 According to this rule, it will be seen that the powers which belong to the 
 States are much the most numerous, and by far the most important in securing 
 the rights and privileges of the citizen. 
 
 I am not contending that the federal constitution is exactly conformable to 
 this rule; but it does not, however, essentially vary from it. There are, as I 
 conceive, two or three additional powers which ought to be incorporated in 
 that instrument, to wit: the powers to provide for a general systemjof educa- 
 tion, and to make canals and roads; and it contains at least one power, the, 
 " power to establish an uniform system of bankruptcy, 7 ' which, as experience 
 has evinced, ought to belong to the States. But, sir, the power now under 
 consideration, the establishment of a banking system, I am fully convinced, 
 is properly and strictly within the limits and meaning of the constitution, and 
 1 think I can clearly and plainly shew that it is so. 
 
'ON THE BILL TO RENEW THE CHARTER OF 1791. 259 
 
 In the eighth section of the second article of that instrument, are contained 
 most of the enumerated powers which are granted to Congress; and the last 
 there enumerated is the power to make all such laws as are *' necessary and 
 proper to cany the foregoing powers, and all others contained in the consti- 
 tution, into operation,'* Among those enumerated powers are to be found, 
 powers to raise revenue; to borrow money; to regulate commerce; and to pro- 
 vide for the general welfare. Now, sir, such a bank as is about to be made or 
 re-established, by the operation of the bill before us, is, in my mind, a ki neces- 
 sary*' thing to enable this Government to carry each of the foregoing powers 
 into effect. I lay particular stress upon the word * necessary ," because gen- 
 tlemen who oppose this bill have relied much of their arguments upon it 
 
 It is u necessary*'* for raining revenue. 
 
 There is, generally, a profit of about three or four per cent, derived to the 
 owners of 'bank capital, beyond what they could obtain for the use of their 
 money, by lending it-out at legal interest. This being a benefit, which can 
 only be secured to them through the interference and protection of Govern- 
 ment, it is but just that they should pay the Government something in return 
 for the lavor thus conferred; and the bill before us contains a provision to this 
 effect. Twelve hundred and fifty thousand dollars is the sum contemplated 
 as the least which ought to be accepted by Government, for a mere renewal 
 of the, charter, with its present capital, for the ensuing twenty years. By 
 passing this law, therefore, wo >iial! derive to the Government that amount of 
 revenue, which, in these times, is. in my mind, no contemptible thing. If the. 
 capital of the bank be eventually enl;irued to thirty millions, we shall derive 
 at least four millions of revenue from it, in addition to some interest which 
 will at times become due on deposits which may be, made in the bank. Thus 
 the i' f this bill becomes a mcftnn of raising revenue. 
 
 It is 4 * ncccxsai if* for the purpose of borrowing money. 
 
 Governments, like individuals, in unforeseen emergencies, must frequently 
 experience very pressing occasions tor more money than they have at com- 
 inand; and to supply this deficiency, nnst resort to borrowing of others, A 
 prudent Government, therefore, like a prudent individual, ought to have the 
 means of borrowing made as certain as possible, in order to avoid the de- 
 rangement, or distress, which may ensue, in consequence of beinp; unable sud- 
 denly to procure a loan. The passing of this bill goes to effect this desirable. 
 object: as it contains a provision for borrowing, with certainty, as large a sum 
 -as this Government will probably at any time suddenly stand in need of. It 
 is, therefore, in that point of view, very "neeeMtfrv," and, in all ordinary 
 -, a great w-n'enieHce, for the purpose of enabling this Government to 
 borrow money. 
 
 It is " nrccmiiry" for the purpose of regulating commerce, 
 
 A very essential regulation in commercial affairs, is, to have that which 
 serves as the representative of all the articles which are the subjects of com- 
 merce, as small, light, and portable, as possible. To travel any distance, 
 and cany with you twenty or thirty thousand dollars, of silver money espe- 
 cially, is extremely inconvenient; but, if you can carry in your pocket some- 
 thing which represents this sum, the inconvenience is at once removed. Yet, 
 this representative must be such as will be received as such in every part of 
 the country, or else it fails of producing most of its beneficial effects. A man 
 residing in New England, has occasion to go to Natchez,, to purchase $20,000 
 worth of cotton; but the bank bills of his own State will not pass there; to 
 cany hard money, is incurring a great risk, and, at the same time, expensive 
 in transportation; hence, it becomes 4i necessary*' to provide a representative 
 of hard money, which will be received as such in every part of the country; 
 and that can only be done by the establishment of a bank, whose bills will 
 have this general currency. Thus, the passage of this bill, or something simi- 
 lar, is " necessary" for th'e purpose of regulating commerce. 
 
 It is u necessary" for the purpose of promoting the general welfare. 
 
 This expression is certainly very broad, and seems, at first view, to include 
 r, .great deal. For this reason, many well meaning politicians have been startled 
 
250 BANK OF THE UKITED STATES. 
 
 at the idea of a delegation of powers so indefinite, and so comprehensive. I 
 imagine, however, that the expression is not pregnant with any mischief or 
 clanger. It certainly would not be "promoting the general welfare," to place 
 any power in the hands of this Government, which could as safely, and as 
 consistently, with \\itgood of the whole^ be exercised by the respective States. 
 It would be upsetting the first and leading principle ot a confederated Repub- 
 lican Government. If we. therefore, invariably adhere to this leading prin- 
 ciple, we shall find the expression not only harmless, but very proper to be 
 placed in the constitution. What I have already said of this bill being neces- 
 sary for the purpose of raising revenue, for borrowing money, and for regu- 
 lating commerce, is perhaps all that is necessary to be said, to shew that it 
 tends " to promote tne general welfare;" because, in this case, the one is ne- 
 cessarily included in the others. 
 
 Permit me now further to add, sir, that this liank,, and its branches, are 
 also essentially "necfsaiwy" for the collection ut your revenue, for its safe- 
 keeping, and tor the purpose of transmitting it from one part of the Union to 
 another, as occasions may frequently require. 
 
 ^+. We are indeed told, sir, that our revenue can as well be collected by, and 
 deposited in, the State banks. What, all the revenue collected itj any one 
 State, to be deposited in one State bank? No, we arc told, we will put five 
 or six hundred thousand dollars in one bank, as much more in another, and 
 so on, until we get it all stowed away in some way or other. Indeed! What 
 an admirable pi aril And which banks will you select for this purpose? Will 
 riot the selection of one, excite the envy and opposition of others, so as to in- 
 duce them to unite in endeavors, and perhaps successfully, to ruin such se- 
 lected bank? Will these selected banks pay the United States as large a 
 sum as is contemplated in this bill, for the privilege of having the revenue de-' 
 posited in their vaults? No,, they contemplate nothing of the kind, it would 
 l3e a bribe, we are told, sirl Besides, it is even said by some, that three or 
 four millions dollars ia but a paltry sum,, unworthy the notice of this Govern- 
 ment! Can you contrive any method to compel the directors of such selected 
 banks to render you, at stated times, a true statement of their situation, oi' 
 their discounts, of the sums due them, of their deposited, in order that you 
 may be convinced that it is safe to trust so much money with them? No, 
 Suppose you want to borrow money, how will you manage matters then? Why, 
 we will borrow a hundred thousand dollars of one bank, a like sum of another, 
 just as a needy man borrows a dollar of one, two of another, and so on, till 
 his wants are satisfied. Better still this is really excellent! Well, suppose 
 you wish, and have made out to borrow, as much, as you have ta send the mo- 
 ney to a different, and perhaps distant, quarter of the Union, are you certain 
 you can make it pass cur vent there? Will not those banks, which have not 
 been so fortunate as to have received a share of governmental favors, take 
 measures for counteracting any such currency? And would it be just to pay 
 off a poor old soldier his hard-earned pittance in bills on which he would 
 probably be obliged to make a discount of five, ten. or perhaps twenty per 
 cent, before he could get them oft' his hands? 
 
 Gentlemen, sir, who oppose this- bill, have got into a dilemma, in opposing 
 it on the ground that the State banks can be made to-ai>s\rer the purposes of 
 this Government; as they thereby virtually admit that banks of some kind are 
 " necessary" in managing its concerns. The point of difference then becomes 
 resolved into this: what sort o banks are necessary? We all understand 
 that the stockholders of State banks would be glad of a slice of the " loaves 
 and fishes."" My neighbor, who keeps a horse to let, might say to me, it is 
 nut" necessary" that you should keep a horse, for 1 keep one, which 1 should 
 be glad to have you make use of. In such case, the arrogance ol' m-y neighbor 
 would be so manifest, that all would commend me in telling him that his horse 
 was but a sorry animal, which he might keep to himself; and that I knew best 
 what kind of horse suited my purpose. Sir, State banks are the creatures of 
 States; this Government cannot control them, and, therefore, ought to have 
 no concern with them. If. however, particular States will be so arrogant as 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 261 
 
 to insist that this Government shall make use of their creatures, why can they 
 not, on the same principle, go a little further, and say to this Government, 
 " here is a collector, a district judge, or a district attorney, which we have 
 created ready to your hands; it is not "' necessary," therefore, that you should 
 create these officers within our jurisdiction, because those which we have cre- 
 ated will fully answer your purpose?" We are not quite ripe for this mode 
 of doing business, sir: but I believe w r e arc in a fair way for its accomplish- 
 ment. 
 
 I perfectly understand, sir. that this preposterous plan of substituting State 
 bank?, has been suggested, and. in some measure, urged, through the influence - 
 of some of those banks. I see runners out from different quarters, endeavor- 
 ing to convert people to this new doctrine. I see presses prostituted to the 
 purpose of endeavoring to raise a popular ferment against the passage of this 
 bill, or any other of a similar nature; but, that any disinterested man can se- 
 riously think, that this miserable quackery with which it is proposed to ad- 
 minister to the wants of the body politic, is really worth a moment's attention, 
 is more than I am willing <o behove. Should it. however, prove too true, that 
 a measure which, during the last session, could hive been carried by a ma- 
 jority of nearly thirty, shall now be lost, although I shall deplore that insta- 
 bility of opinion which shall have produced this sudden change, or that dere- 
 liction of independence wliirh should yield to temporary clamors, artificially 
 raised, i shall, nevertheless, console iny-elf with the conviction, that time 
 and experience will correct the error, and that the merits of this measure will 
 hereafter be decided up:m wilh more correctness of judgment. 
 
 But, sir, I have thus far merely shown that this bank, or some other of a 
 similar nature, is "nece$9aryj 9 in several distinct points of view, to the pur- 
 JK.M-S for which this Government was established. I have not, however, 
 shown, nor can 1 show, that it is indispensably 4 * necessary." But here, sir, 
 lies the error of those who have contended against the constitutionality of the 
 measure. It will be recollected, sir, that, when this bank was first establish- 
 ed, those who opposed it on constitutional grounds, and for their opinions I 
 have the hig'iesi respect, contended that, although the measure might be 
 useful, lit. and expedient, yet, if it was not intHiptntabhj "necessary," it 
 must, of course, be unconstitutional. Lot anyone examine the debates of 
 that time, and they will perceive that this was the strong ground of opposition 
 that was then taken, and the same ground is now taken; but to this I reply 
 If the words of the constitution were, that ki Congress shall have power to 
 uiake all such laws, only, as are indispensably necessary to carry the forego- 
 ing powers into eftect." then, indeed, the opponents of this bill would, on 
 constitutional grounds, be correct; because, that, although the Bank of the 
 United States, or a national bank, if you please, maybe a " necessary ap- 
 pendage to this Government, still are neither of them indispensably '* neces- 
 sary :'" this Government can do without them in the same manner that a 
 fanner can do without a hoe, by substituting a spade, or that a carpenter could 
 do without a plane, by substituting his broad axe. 
 
 The word "necessary" is of the class of adjectives, and admits, though 
 irregularly, of the degrees ot comparison incident to words composing that, 
 part of speech; the positive, necessary; the comparative, wore necessary; arid 
 the superlative, indttpensably necessary. We mean by the first, nceJfuLfit, 
 or proper; by the second, more needful, fit, or proper; and, by the third, that 
 ii'kich we cannot do rrithout. If the words of the constitution were, " Con- 
 gress shall have power to make all laws which shall be needful, fit, and pro- 
 per, for (he purpose of carrying the foregoing powers into effect," the diffi- 
 culty would, probably, vanish at once; as I trust we could soon determine 
 whether a Bank of the United States, or a national bank, is a needful, fit, 
 and proper appendage to this Government. But, sir, we have first given to a 
 harmless expression a most formidable meaning; we have made the word 
 necessary mean indispensably necessary. And, having thus raised a moun- 
 taid out of a molehill, we are now about to resolve, very wisely, no doubt, 
 that we cannot get over the mountain. 
 
262 BANK OF THE UNITED STATES. 
 
 Tf I were to agree to provide a farmer with such tools and implements as 
 are necessary for carrying on the business of fanning, I should suppose that I 
 was bound to provide all such tools and implements as are commonly used 
 in that business. I could not say to him, here is a sled, which must answer 
 the treble purpose of sled, cart, and wagon; or here is a spade* which must 
 answer both for digging and hoeing; I could not avoid my engagement by 
 telling him the cart, the wagon, and the hoe, were not 'indispensably neces- 
 sary; because he could make the sled answer the place of the two former, and 
 the spade the place of the latter. No, sir, this would not be complying with 
 the terms of my engagement. Now, sir, it is a poor rule that ought not to 
 work both ways alike. The People of the United States have granted to Con- 
 gress certain specified powers; and have further granted the means, that is to 
 say, the necessary tools and implements, for carrying those powers into effect. 
 By this grant, then, it becomes proper tor us to make use of all or any of the 
 means that arc needful, fit, and proper, for effecting these purposes; but, sir, 
 we are about to determine that we will not make use of some of them as long 
 as we can possibly do without them; we will reject the car/, and the tvagon, 
 because they are not indispensably necessary; we will mount ourselves upon 
 the sled! and thus we will heavily drag along the concerns of this Government. 
 
 Sir, in the estimation of some, this may be wisdom; it may be patriotism; 
 but, in my estimation, it is neither: it is folly; it is destructive to the best in- 
 terests of this country. 
 
 I shall further here observe, that, if we are determined to test the constitu- 
 tionality of all laws which are passed by Congress, by their being, indispensa- 
 bly necessary, we shall find that a great many unconstitutional laws have 
 been passed. During the last session, we passed a law for creating three new 
 officers in the post office department; yet no one will pretend that the passage 
 of this law w:is indispensably necessary; because that department had been, 
 and could still have been, conducted without them. Indeed, sir, if you look 
 at your statute books, you will see that many laws have been passed that were 
 not indispensably necessary, but were merely needful, fit, and proper. Even 
 this splendid hall must stand in judgment against you, if such a narrow con- 
 struction of that part of the constitution is to prevail; these pillars, of costly 
 workmanship, which surround us, and the elegant dome which they support, 
 were made in conformity to the laws passed for the purpose. And are they 
 indispensably necessary? Could we not do the business of this nation in a 
 room that should not have cost one tenth of the money that has been expended 
 on this? Instead of these easy arid expensive seats, with which every member 
 is accommodated, could we not sit on such as that on which " the immortal 
 Alfred sat?" Again, sir: laws providing for the erection of lii'ht houses and 
 for the establishment of a military academy, have been passed by Congress. 
 These laws must spring out of the power given by the constitution to ** pro- 
 
 to those who are not soldiers, " raising and supporting armies:" but each are 
 means of "' promoting the general welfare," by the usefulness of the former 
 to commercial business, and of the latter to armies, when they shall have been 
 raised. But are either of these indispensably necessary? Certainly not. 
 But, perhaps, 1 have said enough on this subject. Believing, as I do, that 
 the General Government ought to possess all such powers as necessarily con 
 cern the best interest and good of the whole, and believing, too, that the 
 constitution, however indefinite it may in some instances be found, was in- 
 tended to contain a grant of such powers, with the exceptions which I have 
 before mentioned, it must remain for others, and not for me, to gauge and limit, 
 it to such narrow constructions as are equally incompatible with the purposes 
 of national sovereignty, and the obvious meaning of words in our mother 
 tongue. 
 
 There can be no doubt, sir, that our written constitutions are of excellent 
 use in designating the form, and drawing the outlines of Government, in such 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 263 
 
 manner as renders them but little liable to capricious variations. While, in 
 this way, they serve as durable landmarks to those in power, they will, also, 
 be of essential benefit to posterity, if they should incline to a degeneracy of 
 political principles, by exciting their emulation, in holding up to view those 
 principles by which their nobler ancestors were governed. Having been the 
 originals, however, in the adoption of written constitutions of Government, 
 we have made them quite a hobby-horse; and seem to imagine them adequate 
 to all the purposes of preserving our liberties forever. For myself, I am not 
 quite so strong in this belief. I tear that, if we place too much reliance on this 
 specific, without providing some other means for guarding and preserving our 
 liberties, they may depart from us whije \ye are in full possession of our 
 written constitutions. Instead, then, of being over scrupulous about giving 
 to particular expressions, in our constitutions, a narrower meaning than they 
 obviously import, let us try to investigate the principles by which powers must 
 necessarily be regulated in a free confederated republic, if regulated as they 
 ought to be; and, having ascertained this point, having ascertained what 
 powers necessarily concern the ichole united* and what powers may be locally 
 exercised, without injury or danger to the whole, we can then easily perceive 
 what ought to be, and what is the real meaning and intent of words in our 
 written constitutions. And, above all, let us not be terrified by those who, 
 for want of better arguments, appeal to our fears; who tell us of the danger 
 there is in adopting this or that construction, or this or that measure: that, if 
 you admit of powers by implication, you open a wide \ortex, in which will 
 certainly be swallowed up all the powers of the State.-: or that, if you adopt 
 one measure, you will, therefore* adopt another, and another, until you have 
 absorbed all powers \\lntever. Sir, this kind of argument, if argument it 
 may be called, has become stale with me: it has no weiiihi on my mind; and, 
 tor this simple reason, that demonstration and prophesying are tu.> very dif- 
 ferent things. \Vhatever may have been the case in ancient times, 1 have 
 always observed, in my own day, that weak arguments, and a spirit for pro- 
 phesyinif, are usually coupled together. In my mind, thrre is mere danger 
 that tin. 1 State Governments may, from the selfish motives or the ambitious 
 views of some, eventually reduce this Government to a inert' skeleton of 
 i , than that this is ever essentially to weaken the powers of the States. 
 1 trust, however, that the danger of the one absorbing the other is not very 
 great on either side. As all our Governments emanate from the same source, 
 the People this for national* and the others for local purposes as longas we 
 retain our present equality of condition, and of rights, and our consequent 
 independence of sentiment. 1 should suppose that even a sense of convenience 
 alone would always correctly dictate where the different governmental pow- 
 ers ought to be placed. The danger to civil liberty, therefore, lies, pot in 
 the formation of our different Governments, but in the foundations of civil 
 society. If our descendants should lose sight of those principles of civil liberty 
 which we have learned, or if the condition of men should become so unequal, 
 as to produce a state of abject dependence of the many upon the/ew, then, 
 anil I trust not till then, will our present civil institutions be in danger of 
 being overturned. 
 
 As i proceed 1 shall here briefly notice an amendment to the constitution, 
 under which my worthy colleague, (MR. POUTI:R) and an honorable gentle- 
 man from Pennsylvania, (MR, SKYBKIIT) have taken refuge, in order to fortify 
 themselves with an argument against the constitutionality of this bill. It is in 
 these words 4 'The powers not delegated to the United States by the consti- 
 tution, nor prohibited by it to the States, are reserved to the States, respective- 
 ly, or to the People." 
 
 If gentlemen really imagine that they have discovered any thing in this 
 amendment, which goes to render the passage of this bill unconstitutional, I 
 <luill merely observe, that 
 
 " Optics sharp it needs, I ween, 
 
 " To see what is not to be seen." 
 
264 BANK Or THE UNITED STATES. 
 
 If any thing be absolutely passed from one to another by grant, as is the 
 case before us, the grantor becomes divested of that thing, and it becomes im- 
 mediately vested in the grantee. All then that is necessary, in the present 
 case, is iirst to ascertain what powers are granted by the constitution: for it 
 is very certain that what are not granted are still vested in the grantor. A 
 has granted to 13 certain things; noyv, says A to B if my hat is not included 
 iu this grant, the hat shall still be mine. Agreed, saysB. This is a very plain 
 case, sir, and how such intelligent gentlemen could think of entrenching them- 
 selves behind this amendatory article, which, in fact, means nothing, is really 
 more than I can conceive. 
 
 But, my worthy colleague, to whom I have just referred, has taken another 
 ground, on which he has attempted to rest much of his argument against the 
 constitutionality of this bill, and which is therefore worthy of some notice 
 that is, that, by the constitution, this Government derives no powers by implica- 
 tion. Sir, tins appears to me the most absurd doctrine that I have yet heard 
 advanced on this subject. It would be a vvaste of time to go into lengthy de- 
 tails to show the absurdity of this proposition; but let me ask that gentleman 
 wherein could have existed the necessity of those amendments to the consti- 
 tution, which are almost wholly restrictive, if it was not admitted that, without 
 these amendments, Corgress would have had an uncontrolled power to legis- 
 late on the subjects' to which they refer; and yet many of these subjects of le- 
 gislation are not even mentioned in the constitution. The first of these re- 
 strictive amendments is, that " Congress shall make no law respecting an es- 
 tablishment of religion or prohibiting the free exercise thereof; or abridging the 
 freedom of speech or of the press: or of the right of the People peacebly to assem- 
 ble, and to petition Government fora redress of grievances." Now the constitu- 
 tion is silent on all these subjects; yet, if Congress possess no powers to legis- 
 late upon them, where could have existed the necessity of restricting them by 
 this amendment, to certain bounds, if they should at any time deem it proper 
 to make them the subjects of ^legislation? Again, sir, the constitution makes 
 provision for the establishment of a judiciary, but says nothing about the sys- 
 tem of law, whether the civil or common law, by which the courts, thus es- 
 tablished, are to be regulated; how was it then understood that the common 
 law was to be adopted? By implication, undoubtedly. 
 
 But, sir, in showing that this Government derives many pow^rs by implica- 
 tion, I am sensible that I am travelling somewhat out of my way. It is suffi- 
 cient to say, that the power of passing this bill is not derived to this Govern- 
 ment by implication; the power accrues by express terms in the constitution 
 the power of providing the best means for carrying other governmental powers 
 into effect. 
 
 There is one other ground which iny worthy colleague has taken, in his en- 
 deavor to show the unconstitutionally of this bill, which I also deem worthy 
 of some slight notice: that is, that the constituted powers of this Government 
 are'mere delegated powers, not from the sovereign People, but from the States, 
 as States! And how does he prove this strange doctrine? Why, says he, if 
 the States should neglect or refuse to elect the Senators which compose one 
 branch of this Legislature, this Government would be dissolved. Therefore, 
 this Government depends upon the will of the States for its organization; and, 
 therefore, it is a creature of the States! Really, sir, this is very profound 
 reasoning! Let us just look at the other side of the question, sir, and we shall 
 then be enabled to see what a very convenient methqd of reasoning this is. I 
 am going to prove, in the same way, the very reverse of this proposition; that 
 is, that the constituted powers of this Government are mere delegations of 
 powers, not from the States, as Stales , but from the sovereign People. I prove it 
 thus, sir: If the sovereign People should neglect or refuse to elect the Represen- 
 tatives, which compose one branch of this Legislature, this Government would 
 be dissolved: Therefore* this Government depends upon the will of the People 
 lor its organization; and, therefore, it is a creature ot the People. In the. same 
 way, sir, you can prove that the State Governments owe their existence to the 
 will of the returniug officers of the different counties; because, if those ofii- 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 265 
 
 cers should neglect or refuse to make the returns of the elections, there could 
 be no State Legislatures, and thus the State Governments would be dissolved- 
 Therefore* a State Government depends upon the will of the returning offi- 
 cers: and, therefore, it is a creature of those officers. 
 
 Admitting, for argument sake, that we could not go to elections unless our 
 horses would carry ua there, we can, in the same manner, prove that all our 
 Governments are creatures of those animals: because, if our horses should re- 
 fuse to carry us to the election polls, there could be no elections; if there were 
 no elections, there could be no Representatives chosen: and, if none wore cho- 
 sen, there could be no Legislatures; and thus the Governments would be dis- 
 solved. Therefore, all Governments would depend upon the uriHof our horses; 
 and therefore, they would be mere creature.-; of those animals. 
 
 We arc vepy apt to run a wild goose chase, sir, when we attempt to demon- 
 strate, by reasoning, facts which are obvious to the senses. Thus, if you 
 would prove that there is heat in fire, don't go to reasoning about it, but put 
 your finger into it, and the fact will bo ascertained at once. In the same man- 
 ner, when we want to ascertain whether this Government is a creature of the 
 States, as States, w whether it is a creature of the People, let us just look at 
 'ution itself the text book, as an honorable gentleman from North 
 iina calls it and there we can ascertain the fact precisely. Its preamble 
 determines the point. The words of that preamble re, * We, the People of 
 the L'nited States," &c. Not k ' We the Knited i S/atcs," &c. 
 
 But, sir, evrn if ; ;-:!:nen't w,;r, a creature of the States, as Stales, 
 
 what bearing could it have on the question before us? Ought we, on that ac- 
 'nuist, to give *o words in that constitution a different meaning? Would 
 the words, ' Congress shall have power to make all laws which are necessary 
 and proper to carry the forcgoisi;; powers into effect," i.-' L-,b!e to different 
 infer, . r.ccoiding us a should lined that this Government is 
 
 a creature of the States, as Staff!:?, or of the People? Certainly not. 
 
 I have thought proper, thus far. t;> notice some of the principal grounds on 
 which my worthy colleague has rested his arguments against the constitution- 
 ality of this bill: because, if i! :;dsare not tenable, his arguments must 
 fall of course; and thus would be Justified the as.-ertion of the honorable gen- 
 tleman from Massachusetts, (Mr. PICKMAN) that the whole argument, taken 
 together, is " an ingenious piece of sophistry."' It is so, indeed; and it is 
 nothing more. Another inducement which I have had for this, is, to enable 
 myself with propriety, and at the same time with pleasure, to observe, that 
 the grounds taken by my colleague, have been the principal reliance of the 
 opponents of this bill: as many gentlemen on that side have, probably with 
 a very hewming diffidence in the strengh of their own views of the subject, 
 pointed to him as OIK; amongst them whom they seemed to imagine had sus- 
 tained the argument a tribute of applause which 1 think those gentlemen 
 were bound in conscience thus justly to bestow. 
 
 Having, as I trust, obviated the constitutional difficulties which have been 
 urged against the passage of this bill, i; remains to say something about its 
 merits; and in doing this, I shall be as concise as possible. 
 
 It would be arrogance in me, sir, to go into a lengthy and minute detail of 
 the operations of banking, as it is proper to presume that every member has 
 made himself acquainted with the subject. I might, however, be permitted 
 generally to observe, that, from the constant depreciation of gold and silver 
 money for centuries past, and the probability of their still continuing to de- 
 preciate, the necessity of a well established banking system becomes, every 
 day, more and more obvious. Ten thousand dollars, which in these days is 
 but a moderate fortune, is nearly a cart load in silver. Thirty years ago, half 
 that sum would purchase as much as the whole will now. Possibly, in the 
 course of a century, a pound weight of gold will not be more valuable than 
 a pound weight of silver is at present. Gold, as a currency, will then have 
 become very cumbersome; and silver, as a currency, will then be scarcely 
 portable. What then is to be done? Why, put these metals into the vaults of 
 bunks, and issue, in paper, that which represent a them: or rather, that which 
 34 
 
BANK OF THE UMTKI) STATES. 
 
 jointly represents them, and the promissory notes, or rather lieus on property 
 which are deposited there. This, sir, is the only remedy of which I can have 
 any conception; and therefore it appears to me highly important, that the 
 best possible plan of banking should be devised and adopted by this Govern- 
 ment. 
 
 It has been .my opinion, sir, that, instead of the present United States' 
 
 nk, a National Bank ought to be established, upon a general plan, and be 
 so organized as to invite, and eventually draw into it, much of the other bank- 
 ing capitals, in order that the business of banking might be reduced more to- 
 one entire system; that it should not be under the control of Government, but 
 nevertheless under their inspection; that, for this purpose, Government should 
 appoint a small proportion of the directors in every branch, and in the mother 
 bank, whose business it should be to render, at proper intervals, stated ac- 
 counts of its debts, discounts, and dcposites, in order that it should always 
 appear that it was properly conducted, and kept within due bounds; and 
 finally, that Government should share such part of the profits of the establish- 
 ment, as might be deemed reasonable. Proper provisions ought also to be 
 made to prevent its being rendered subservient to political or party purposes, 
 which I imagine would be no very difficult thing. 
 
 The principal advantage to be derived from a general system of this kind, 
 in addition to some which I have before mentioned, would be, first, its afford- 
 ing a permanent revenue; secondly, its greater security and stability; and 
 thirdly, the uniformity of its currency, and the better means of providing 
 against losses by counterfeiting. 
 
 I am, however, sensible, sir, of the great difficulty of convincing every one, 
 by whose vote it must pass, of the practicability of any new plan of this kind, 
 however perfect, and well matured it might be when offered. I am also sen- 
 sible of the inconvenience of pulling down one system, in order to build up 
 another, and of the distress and ruin of individuals it would occasion, if it 
 should be done suddenly. I am, therefore, willing to adopt such plan, as, if 
 not the best, shall be thought, by a majority, the most expedient at present, 
 and leave to futurity the building up of a different system. I shall therefore 
 vote for a mere re-incorporation of the present bank, if nothing better can at 
 present be had; and if any thing can be added to it, by way of improvement, 
 so as to render it less exceptionable, [ will also vote for that. 
 
 Perhaps, sir, it might be as well to re -incorporate the present bank for eight 
 or ten years only, and, in the mean time, be making provision for building up 
 another, upon a more approved plan. 
 
 I conceive, sir, that the ad vantages of banking depend much upon the man- 
 ner in which the system is organized . If properly organized, they are un- 
 doubtedly a great national benefit; if badly organized, they become a nuisance 
 to the community; and some of the banks which were established in the East- 
 ern States, are striking instances to illustrate the truth of this remark. 
 Generally speaking, it may be said, that all petty banks are in danger of be- 
 coming such nuisances; because they are but too apt, in the first instance, to 
 be established, and sometimes managed, upon improper, or even dishonest 
 principles. In some instances they have proved mischievous, from the mere 
 ignorance of those by whom they have been managed, of the only true prin- 
 ciples on which banks can be safely conducted. 
 
 When properly organized, the great and most essential benefit derived, 
 consists in the saving of labor, if I may so express myself, in procuring the 
 requisite quantity of gold and silver, to represent all the various articles of 
 wealth in a nation. Suppose, for instance, that a million of inhabitants were 
 to be placed by themselves, without any gold and silver amongst them, but, 
 at the same time, with a sufficiency of all the other articles which constitute 
 wealth; they would then require, say five millions of dollars fora circulating 
 medium, to represent those articles, in order to be enabled to carry on com- 
 merce or exchange, amongst themselves; of course five millions' worth of their 
 articles of wealth, or, in other words, five millions' worth of their labor, must 
 be sent abroad to purchase and bring back this necessary quantity of gold and 
 
t>N THE BILL TO RENEW THE CHARTER T)F 1791. 267 
 
 silver. Now, by the establishment of a banking system, on proper principles, 
 one half of this hard money would answer their purpose, and thus they would 
 save to themselves two and a half millions' worth of their labor, or its pro- 
 ducts, which they could apply to other purposes. 
 
 Now, the territory of the United States will, according to their present 
 ratio of increasing population, in the course of a century, be tilled with a hun- 
 dred millions of inhabitants. They will therefore require, say live hundred 
 millions dollars for the necessary circulating medium; at present, there is, say 
 forty millions in circulation; ot course four hundred and sixty millions' worth 
 of the products of their labor must, in the course of a century, go abroad, to 
 bring back its value in gold and silver, to provide this necessary circulating 
 medium. Rut, if we can establish and perpetuaie a safe and durable banking 
 system, only one half of this value in the products of labor need go abroad to 
 bring back the requisite -quantity of gold and silver; and thus a gain is, in that 
 time, inatle, to the amotsntof two hundred and forty millions' worth of labor, 
 whic!i would probably be nearly sufficient, to make all the canals that may 
 become requisite within our territory. 1 have made this statement in genera! 
 terms, to show how immensely important it must be to the United States to 
 establish a banking system, upon the most durable and best possible plan. 
 
 An honorable gentleman from Virginia on my left, (Mr. BURWELL) has in- 
 formed us, if I understood him rightly, that he is, on the whole, opposed to 
 the banking system entirely, because it tends too much to encourage com- 
 merce; that we are already too commercial. I am sensible, sir, that, in the 
 Southern States, a prejudice has existed against commerce; and this very 
 prejudice has served to build up a great many houses in our Northern towns, 
 at the expense of the Southern States, because, if those States, particularly 
 Virginia, had exerted themselves in encouraging commerce to be carried on 
 within their own limits, much of the wealth, so rapidly acquired in commer- 
 cial pursuits, which is now to be found in those towns, might have been amass- 
 ed in those States. But does that honorable gentleman really believe that, 
 by putting down this bank, there will be less banking business done in the 
 United States? No, sir, the capital that is now employed in this bank, will 
 soon find its way into State banks. Permit me also to say, sir, that the notion 
 of trying to make ourselves less commercial, is idle and visionary; it is the 
 "stulf that dreams aiv made of." I admit, sir, that, for the purpose of ren- 
 dering ourselves less dependent on other nations, it might be well to encourage 
 manufactures to a certain degree. But suppose we should, would we be 
 essentially the less commercial on that account? I trust net. Commerce 
 seems to be congenial to the disposninn* of a large portion of our countrymen, 
 and it is in vain to attempt to change their habits and pursuits. Indeed, sir, 
 if we will but look at the nations of the world, both of ancient and modern 
 days, we shall find that those who have been most commercial, have ever been 
 the most active, enterprising, intelligent, and free. I consider commerce as 
 one of the great levers by which the world has been raised from darkness into 
 light; from barbarism into civilization and refinement. 
 
 An honorable gentleman from Maryland, (Mr. M 4 K.iM) has given us a 
 statement of the situation of the Bank of the United States, which [ will 
 just notice. That gentleman made this bank indebted to somebody, I dont 
 know whom, in the sum of about ten millions dollars. 
 
 The gentleman also informed us that he had been a bank director in his 
 time of course, that he must understand the business. 
 
 Presently, however, the worthy intelligent gentleman began to say some- 
 thing about notes deposited in the bank for discount, to the amount of fifteen 
 millions dollars. But these notes, he strenuously contended, were not due to 
 the bank. So much knowledge must, I suppose, have resulted from having 
 been a bank director. \ think the gentleman afterwards admitted, that, if 
 these notes were really due to the bank, it would then, indeed, possess the 
 means of producing a general state of distress, if we should compel it sud- 
 denly to wind up its concerns. Exactly so, sir. So far the gentleman was 
 correct. 
 
9(58 BANK OF THE UNITED STATES. 
 
 But, with respect to the rest of thlj statement, I shall merely observe, that, 
 if a gentleman could make a mistake at' fifteen millions dollars in half a minute, 
 how far would he probably travel out of the way in half an hour? Why, sir. 
 he would be in danger of becoming one of tire antipodes. 
 Another objection urged against the renewal of the present bank charter is, 
 that a large part of the stockholders are subjects of Great Britain; and that, 
 if we should happen to be at war with that nation, these capitalists would 
 have it in their power to injure the best interests of this? country. 
 
 On the first impression, it struck me that this might possibly be the case? 
 but, on more mature reflection, I cannot see how this could be done, even if 
 those capitalists were so base and so regardless of their own interests, as to 
 attempt any thing of the kind. They have no direct control over the con- 
 cerns of the bank ; it is managed by directors, who are citizens of the United 
 States. If any one can, h nvever, point out any effectual method which could 
 betaken by these capitalists, and which it is even remotely probable would be 
 taken, I will then admit that this may be a greater or less objection, not 
 against the re-incorporation of the bank, but against the policy of suffering 
 European capitalists to hold much property in the bank. 
 
 Another objection which has been urged is, that this bank is under the 
 management of those who are, for the most part, opposed in political senti- 
 ment to the present administration. 
 
 If I believed that those who manage the concerns of this bank could wield 
 it as a political engine, as was formerly the case, I should be induced to vote 
 against the bill entirely. But, sir, the fact is, this is not the case at present, 
 nor do I conceive it can ever be the case again. So many State banks have 
 been treated, that men of all political descriptions can now be accommodated 
 at one bank or at another: so that the idea of bestowing bank favors, as a 
 reward for political professions, has been long since abandoned. As the En- 
 glish mastiff has, therefore, lost his teeth, he can no longer bite those who are 
 not of his household and knowing this, his fierceness has abated; he has be- 
 come more civil to strangers, and more fit and willing to be made subservient 
 to the wishes of all. 
 
 Sir, there is another string which is yet necessary to be touched, and I 
 shall touch it but lightly; for it is a tender one. It is the distress and ruin 
 which must ensue upon the vote that is about to be given, if that vote shall, as 
 1 believe it will, be against the re-incorporation of this bank, in some shape or 
 other. From this distress, sir, probably all of us will be exempt; the storm 
 will pass over us, and we shall only hear it at a distance; yet, the individuals 
 on whom it shall most heavily fall, will not, on that account, feel it the less 
 sensibly. When I speak of individuals, I mean to express myself emphati- 
 cally. There are incorporated individuals, whose favorite dwellings may yet, 
 by this vote, be shook to pieces over their heads. But, as far as any of these 
 may have been instrumental in producing the present state of things, so far 
 will their labors have obtained their just reward. I hope, however, that none 
 of this description, in my own State, have had any agency in this business. 
 But, sir, for those unincorporated individuals who are to be sacrificed by this 
 measure, I feel some commiseration; because, I have some idea of the feelings 
 that a ruined man must experience, particularly if he has a family to be sup- 
 ported by his exertions. It would be easy, because it would be natural, to 
 draw a picture of this kind of distress. But this is not the only dark side 
 which might be presented; its demoralizing effects ought also to be noticed. 
 By too frequently, and, in this case, I may add, wantonly., deranging and 
 prostrating the aftairs of individuals, particularly of mercantile men, you na- 
 turally encourage in them, from mere motives of self-defence, principles which 
 tend to render them a set of sharpers. 
 
 I have heretofore mentioned that there were, at the last session, nearly 
 
 thirty of a majority for re -incorporating this bank. And among those were 
 
 two of my honorable colleagues, whom I now find on the other side of the 
 
 question. It would now seem that tthere is, probably, a majority against ^it. 
 
 'How does this happen? I can account for it in part, but not wholly. The 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 269 
 
 Legislatures of some States have undertaken to " instruct 9 - or " request" 
 their several delegations to vote according to their views ot the subject. It is 
 generally understood, I believe, sir, that those who may not think proper to 
 listen to this monitory warning, are to be denounced, cast off', and thrown, not 
 into a den of lions tor those animals, though tierce, are somewhat noble in 
 their nature but into a den with one or two ugly wild beasts, exotics, I believe, 
 sir, who seem to be kept on account of the peculiar facility they possess of be- 
 smirching others with their own tilth. But I would ask those who have thus 
 undertaken to instruct arid direct members here, how, in God's name, did 
 they become invested with this controlling power? Were they elected to man- 
 age the affairs of this Government? As well might the State delegations to 
 this Government assume to thvm-i -Ivrs the right of instructing and directing 
 their several State Legislatures how they should act. No dictatorship in this 
 free country, sir ! I, for one, protest against it. I hold myself responsible to my 
 constituents only, for the vote I may give on any question j and that vote 
 which my conscience tells me I ought to give, shall never be controlled by 
 the imposing frowns of any man or set of men, whatever. 
 
 Sir, if this doctrine is to prevail, that the State delegations are to direct us 
 how we must act, then we shall be in danger of becoming a fallen People! It 
 will go to subvert the purposes for which this Government was established. 
 It will be reducing us to a state which may even prove worse than the old con- 
 federation: for, even under that system ot government, the State Legislatures 
 did not attempt to dictate to ('on.mvss, but, on the contrary, Congress used to 
 recommend measures for them to adopt. 
 
 My idea, sir, of the best method of getting along with our various concerns 
 is, for each to mind their own business. 1 am not so arrogant as to have any 
 wish to control the opinions or the votes of others: and all that I require in 
 return is, that the same measure of courtesy be dealt out to m-. 
 
 Sir, 1 have thought proper, in order to vindicate my own sentiments and 
 my own independence of feeling, to say thus much; I have little more to say, 
 further than to repeal, that I am Opposed to putting down this bank suddenly 
 and unexpectedly j and in noway, whatever, unless it be done gradually, while 
 another, less exceptionable, is rearing up to fill its place. Permit me to add, 
 sir, that it requires so much less capacity to pull down than to build up, that 
 1 am afraid that some who never can distinguish themselves in the one way, 
 may, in their love of fame, aim at an acquirement of some distinction in the 
 other. I confess I have some little fears on this subject: for I am fully con- 
 vinced, sir, that, if ever this Government shall be prostrated, which God for- 
 bid, the work will be accomplished, not by Romans, but by hands such as 
 those under which Rome sunk and perished. 
 
 Mr. CRAWJ OHD. Mr. Speaker: A solemn impression of the duty which I 
 owe to the public, and more particularly to that portion which I more imme- 
 diately represent, can alone induce me, awkwardly circumstanced as 1 am 
 from habit, to come forward on the present occasion; or support me under the 
 embarrassment 1 feel, in presuming, for the first time, to deliver my sentiments 
 on a question of great national importance, before a deliberate assembly. The 
 subject having been already very amply examined, I shall confine my remarks 
 to a very few of the most prominent principles connected with the bill. In 
 so doing, I shall manifest my inclination rather than my ability to perform 
 my duty. 
 
 Indeed, after the very eloquent and conclusive argument of the gentleman 
 from New York (Mr. PORTER) on the constitutionally of the bill for the 
 renewal of the charter of the Bank of the United States, any farther attempt to 
 elucidate that part of the subject may appear equally unnecessary and imper- 
 tinent. But as some very partial and indirect attempts have been made to 
 set aside his argument, 1 request your indulgence, whilst I endeavor to investi- 
 gate the positions, relied on by his antagonists, as a means of palming this 
 counterfeit again upon the nation for twenty years longer. If, in this discus- 
 sion, I depart from the usual form of addressing you, by 'giving it somewhat 
 
270 BANK OF THE UNITED STATES. 
 
 of a colloquial form, I must rely upon the liberality of the Mouse for indulg- 
 ing so unusual a claim upon their attention, 
 
 As a Representative of the People, then, I assume what has been called an 
 inclusive po .ver to establish a bank, as incidental to the power granted to lay 
 and collect taxes, duties, imposts, and excises, by the constitution, in section 
 8th, article 1st. as incontrovertible. In granting this power it necessarily fol- 
 lows, that I possess all the means necessary to carry such power into eft'ect. 
 It is left to my; discretion to employ the best means which offer for that purpose. 
 This opinion is supported by article 17th of the same section, which empowers 
 me to make all laws which shall be necessary and proper for carrying into 
 execution the foregoing powers, and all other powers vested by this consti- 
 tution in the Government of the United States, or in any department thereof. 
 If, therefore, I consider a bank as necessary and proper to carry into effect 
 the power to lay and collect taxes, it thence becomes a power growing out 
 of constitutional authority, and it is my duty to carry it into execution. 
 
 Here lam interrupted by my constituent, who objects, that I have failed in the 
 establishment of my premises, and in proving that a bank is the most suitable 
 means to accomplish the end in view. That many other measures, more ade- 
 quate, present themselves to his mind; and if taxes may be collected by 
 safer and better means, banks become, agreeably to your own doctrine, 
 unnecessary, and therefore unconstitutional. 
 
 This objection I endeavor to surmount, by alleging that banks, by furnish- 
 ing.money, provide the means of purchasing the fruits of my industry; and thus, 
 bringing more competitors into the market, I am enabled to dispose of my 
 productions with greater certainty, and at a better price. Hence I am qualified 
 to comply with the demands of Government, without seriously suffering from 
 the pressure occasioned by such demand. Banks, therefore, affording more 
 convenient means of paying taxes, become necessary and proper to their col- 
 lection, and are therefore constitutional. 
 
 Here again my constituent objects, that those who hold bank paper will not 
 part with it without adequate value, in produce or other property. If it should 
 so happen that there shall be little or no demend for such produce or pro- 
 perty, the paper holder will either refuse to exchange his paper therefor, or 
 reduce the price, in proportion to the unsaleable or perishable nature of the 
 commodities offered. Nay, having, by his fictitious representative, nearly ba- 
 nished gold and silver from the market, he may feel disposed to take an undue 
 advantage of this withdivwn competition; and thus lather diminish or destroy 
 the capacity to comply with the public demands. Banks, therefore, afford 
 only a problematical resource on which to rely for the payment of taxes. 
 They are themselves the effect, and not the cause, of increased commercial 
 prosperity. The consumption of, and demand for, the articles produced, fur- 
 nish the true means of meeting all demands, by the equivalent given for such 
 productions. Bank paper stands, by agreement, as the sign only of such 
 equivalent, and not as the thing signified, and possessed of intrinsic value. 
 The thing signified is therefore alone essential to the payment of taxes. This 
 is the result of my labor, or of such articles as that labor has been exchanged 
 for. Whilst there is a demand for the products of my labor, there will be no 
 deficiency of means to pay taxes. If this demand cease, bank paper will not 
 relieve my distress. Banks afford, therefore, only a conditional, and not an 
 absolute means to favor the laying and collecting of taxes. They are not the 
 best which offer as necessary and proper; and are, consequently, not consti- 
 tutional. This argument may be strongly enforced, by tracing it through its 
 various relations and tendencies. The constitution prohibits the State Legis- 
 latures from making any thing, save gold or silver, a legal tender. Hence, 
 you may infer, that Congress possesses the power to establish a bank, and 
 make its paper a legal tender: for, if they possess a power to establish a bank, 
 as a means for the laying and collecting taxes, they must also possess the 
 means of making such bank paper efficient. If they possess a power to make 
 bank paper a legal tender, to support the institution of a bank, they possess, 
 likewise, the means of enforcing this power. The best means of enforcing 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 271 
 
 this power is a standing army. Congress, therefore, according to your doc- 
 trine, possess the power, in the last resort, to compel us, at the point of the 
 bayonet, to receive their bank paper as a legal tender, that they may give fa- 
 cility to the laying and collecting of taxes. Such are the dangerous conclu- 
 sions to which the admission of such arbitrary doctrines necessarily leads 
 doctrines to which, I trust, we will neither of us submit while life remains. 
 But I will now endeavor to show, that you possess no constitutional authority 
 to enforce such tyrannical doctrines. In article 10th, amendments to the 
 constitution, the doctrine is expressly laid down, that " the powers not dele- 
 
 fited by the constitution to the United States, nor prohibited by it to the 
 tates, are reserved to the States, respectively, or to the People." But 
 the power to erect banks is no where prohibited, by the constitution, to 
 the States; it is therefore reserved by it to the States, respectively, or to the 
 People. Congress, therefore, cannot usurp this power over the States, so ex- 
 plicitly and expressly reserved, without a flagrant violation of this < (not an 
 interpolation, as it has been jesuitically styled, but} integral part of the con- 
 stitution. This opinion is confirmed by article 9th, amendments to the con- 
 stitution, which declares, that the enumeration in the constitution of certain 
 rights, shall not be construed to deny, or disparage others retained by thePeo- 
 pte. But the People have retained the right to establish banks: for all powers 
 not delegated to the United States, or prohibited to the States, are reserved to 
 the States, respectively, or to the People. The States and the People have ex- 
 ercised this right. Their power to do so has never been questioned. Every 
 attempt to exercise this power, on the part of Congress, is an encroachment 
 on this right, is a denial or disparagement thereof, and becomes thence a vio- 
 lation of the constitution* The Elates are prohibited from making any thing 
 but gold or silver a legal tender. They possess an unquestionable right to 
 erect banks, but they cannot make their paper a legal tender. If Congress 
 possess ilie jnwer to create a national bank, they are not prohibited from 
 making its paper a legal tender. This silence may be construed into a power 
 of giving legality to their paper, by making it a tender. It may thus be exer- 
 cised so as to construe their right into a denial or disparagement of the rights 
 retained by the People. 
 
 If any doubts still remain, respecting your want of constitutional authority 
 to create a national bank, I will proceed to satisfy you that you are clothed 
 with no such dangerous power. 
 
 By the constitution you are merely the servants of the People, acting under 
 a specific power of delegated trust. You are strictly limited to the powers 
 therein delegated, or to such incidental powers as are Necessary and proper 
 to carry into execution the foregoing powers, and all other powers vested by 
 this constitution in the Government of the United States, or in any department 
 or officer thereof; that is, you shall possess all the means necessary and proper, 
 provided the powers vested in you by the constitution cannot be carried into 
 eftecr without such means; or where your power to use such means is not 
 doubtful or limited. In art 5th of the constitution we are instructed, that 
 44 The Congress, whenever two thirds of both Houses shall deem it necessary, 
 shall propose amendments to this constitution, 01% on the application of the 
 legislatures of two thirds of the several States, shall call a convention for pro- 
 posing amendments, which, in either case, shall be valid to all intents and pur- 
 poses, as part of this constitution, when ratified by three fourths of the several 
 States, or by conventions in three-fourths thereof, as the one or the other mode 
 of ratification may be proposed by the Congress, provided that no amendment 
 which may be made, prior to the year one thousand eight hundred and eight, 
 shall in any manner aftect the first and fourth clauses in the ninth section of 
 the first article, and that no State, without its consent, shall be deprived of its 
 equal suffrage in the Senate." If the States arid the People were so extremely 
 cautious and guaided in procuring any amendment to the constitution, will 
 they calmly witness a sacrilegious infraction of its most sacred principles? 
 Will they permit you, by a constructive power, to create rights which deny 
 or disparage those which they have expressly reserved to themselves? Have 
 
272 BANK OF THE UNITED STATES. 
 
 they not ordered you, whenever your powers are doubtful, defective, or limited, 
 to apply to them for the remedy? Have they not explicitly provided the man- 
 ner in which such remedy shall be applied? They nave not permitted you to 
 cut and carve for yourselves. A power is given to lay and collect taxes, du- 
 ties, imposts, and excises. You shall have collectors and excise officers as 
 incidental to their execution; you are to provide the safest deposites for them 
 within your constitutional reach; you must preserve them under your per- 
 petual control, by contract; you will be allowed stationary, store room, and 
 house rent, with every other essential accommodation; but as we have reserved 
 the power of creating banks to the States or to ourselves, you can claim no 
 constitutional power over them, unless within the district over which we have 
 given you exclusive legislation: and this power you are invested with, merely 
 as Legislators for that district, and not in your capacity of Representatives of 
 the States, respectively, or of the People. 
 
 But you conclude that the question of constitutionality is settled by prece- 
 dent, acquiesced in by all the constituted authorities for twenty years. Such 
 a conclusion facts will not justify. It is a most dangerous doctrine; it is an 
 abandonment of the State sovereignties, who have lor tvyenty years practi- 
 cally opposed and denied such doctrine. More than three-fourths of the States 
 have, for a large portion of that period, been in the practice of establishing 
 banks within their respective State sovereignties. If they had divested them- 
 selves of this sovereignty, by a delegation of such power to the United States, 
 they would never have dared to exercise such a flagrant ursupation of power. 
 Congress could not, without violating their oaths, have permitted this usurpa- 
 tion of their delegated authorities. Upon all other occasions they have been 
 sufficiently jealous of the encroachments of State authorities. Can it be im- 
 agined that they would have witnessed such a daring and dangerous innovation, 
 if such powers had been unequivocally delegated? On a subject of such mag- 
 nitude, no one can believe such improbable suppositions. But it is all impor- 
 tant to the peace, safety, and happiness of the union, that this subject be fully 
 and fairly met; that it may be set for ever at rest. It is a subject on which 
 we cannot suppose the constitution was intentionally silent; provided the 
 povyer was intended to be given by the States. It is one in the exercise of 
 which collision would most frequently^ occur. The power would therefore be 
 expressly given, expressly reserved; or an agreement made to share it mutu- 
 ally. If any -such agreement exists, it must, from the necessity of the case, 
 be specific, express, and accurately defined and limited. No such compact 
 exists in the constitution of the United States. Upon this subject there is 
 therefore only one alternative. The power is either expressly given or reserv- 
 ed. It is of too imperiousa nature to be sought for by implication, inclusion, or 
 as an incidental means to carry any other power into effect- It has never been 
 contended that any such power is expressly given by the constitution. If it 
 had ever been parted with, it was all-important that it should have been parted 
 with expressly. If it has been parted with, it can be shown. If it can be 
 shown, it requires no casuistry to support it. Casuistry may involve and ob- 
 scure it can but seldom enlighten its subject. The sole power given to the 
 United States, to coin money, regulate commerce, or make war, has never been 
 questioned. Upon these subjects no State has ever shown a disposition to 
 interfere, either with the powers, or the nieans necessary to carry these pow- 
 ers into eftect- No similar delegation of power on the subject of banking can 
 be shown. It is therefore expressly reserved. For if it has not been so reserv- 
 ed, the individual States have, most of them, been in the daily usurpation of a 
 power which did not of right belong to them, which of right belonged to ano- 
 ther, for nearly twenty years. But, if they have been in the exercise of a legi- 
 timate authority, then have the United States been exercising a dangerous and 
 arbitrary usurpation of power, never delegated, expressly reserved, and prac- 
 tically denied and opposed by the States, during the whole of that period. 
 Those who advocate the power of the United States over this subject must 
 yield the sovereignty of the individual States. They must show this yielding 
 of sovereignty, otherwise their power is a usurpation. They have not shown 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 any such delegation of sovereignty by the States. They never can shew it, in 
 this constitutional instrument. *It is therein expressly reserved: for, "the 
 powers not delegated to the United States by the constitution, nor prohibited 
 by it to the States, are reserved to the States, respectively, or to the People." 
 
 Obliged thus to abandon my constitutional position, I endeavored to rally 
 my scattered forces, on the extensive field of expediency. I expatiated on th 
 immense advantages resulting from a common circulating medium, the facili- 
 ties afforded thereby to our fiscal and commercial relations, and the stimulus 
 given to industry by a large foreign capital. My constituent suddenly arrest- 
 ed my progress, by observing, that it appeared idle to consume our time in 
 castle- building, while we possessed neither the power nor the materials to 
 erect them: tor, when the constitutional authority is denied, no expediency 
 can justify such an assumption of power. Such an assumption would, if ac- 
 quiesced in, break down all the|mounds raised by the People for their protection 
 against the lawless encroachments of power. It would remove those land- 
 marks, set up by them for their guide; and, whenever such encroachments 
 would be attempted, exposed them a defenceless prey to their enemies. I 
 will, however, otter a few observations on the subject of expediency, and hope 
 to shew you that, even on that ground, you are exposed to defeat. As to the 
 fiscal operations of the country, they may be readily and safely conducted 
 through less dangerous channels by a differentmodification of means, with- 
 in constitutional reach. A large foreign capital is equally susceptible of being 
 injuriously as of being beneficially employed. We had better remain unem- 
 ployed, than use means to promote industry which may only place us more 
 completely at the discretion of foreign Powers, by giving them the discretion 
 of, and command over, our industry. It cannot be questioned, that the large 
 foreign capital in our country has been highly instrumental in deluging our 
 country with unnecessary and extravagant articles of foreign growth and ma- 
 nufacture. These foreign gewgaws have nearly destroyed our economical 
 and simple habits, as an agricultural People, and rendered us tributary to 
 those foreign Powers, whose meretricious arts have inveigled us into such pro- 
 digal consumption of their commodities. The same funds have been employed 
 to retard our progress in manufacturing for ourselves, lest we should become 
 in reality independent, and disobedient to our task-masters; whose artful 
 policy has nearly banished gold and silver, by the introduction of their ficti- 
 tious capital, that they might thus disarm our energies if the expiring em- 
 bers of personal liberty or national independence should again rekindle, and 
 nerve our arms and animate our hearts against every insidious or perfidious 
 encroachment upon the dearest rights of freemen. 
 
 Again I endeavored to arrest the glowing progress of my constituent, by 
 directing his attention to the numerous memorials on our table: painting, in 
 fascinating colors, the beneficial operations of this institution on our country, 
 and its Government, and shading the back ground of the picture in sombre 
 colors, with the ruin which a refusal to re-charter the bank of the United 
 States must bring down on the devoted heads of our State banks, and our com- 
 mercial cities, and which threatens to extend its desolations to every de- 
 scription of our citizens. 
 
 What, my friend, exclaimed my constituent, have these basilisks so fasci- 
 nated you, by their legerdemain artifices, as to deprive you of the evidence of 
 your senses? Have you not, from the same description of people, numer- 
 ous representations which boast a redundant capital? So redundant as to 
 induce them to vest their superfluity of wealth in speculations upon British ma- 
 nufactures, and other articles of British commerce, by anticipated remittances? 
 Is it unreasonable to trace these contradictory statements to the same impure 
 source? May not this redundant wealth consist of national or mercantile depo- 
 sites, in the national bank, granted to such special friends as trade in British 
 commodities, to favor their immense importations, and destroy our infant ma- 
 nufactures, that they may shackle our commerce in foreign fetters? May not 
 the fictitious capital of the same institution be employed to coerce American 
 citizens the friends of American prosperity and independence into a re- 
 35 
 
274 BANK OF THE UNITED STATES. 
 
 newal of their favorite bank charter? To this rational solution of memorials, 
 so contradictory in their nature, I could offer no satisfactory reply I gave up- 
 the cause as hopeless, on American ground. As an American citizen, I can 
 never yield my assent to a measure, so apparently pregnant with mischief to- 
 the rights and liberties of my constituents. I cannot thus betray the confidence 
 reposed in me as a Representative of the American People, or violate the oath 
 which I have taken to support the constitution of the United States. 
 
 JANUARY 24, 1811. 
 
 The House resumed the consideration of the motion to postpone, indefinite- 
 ly, the further consideration of the said bill. 
 
 And the question being taken, it passed in the affirmative ayes 65, noes 64> 
 
 Those who voted in the affirmative, are, 
 Messrs. L. J. Alston, Me 
 
 
 Anderson, 
 
 
 Bacon, 
 
 
 Bard, 
 
 
 Barry, 
 
 
 Basset, 
 
 
 Bibb, 
 
 
 Boyd, 
 
 
 Brown, 
 
 
 Butler, 
 
 
 Calhoun, 
 
 
 Cheves, 
 
 
 Clay, 
 Cochran, 
 
 
 Crawford, 
 
 
 Cutts, 
 
 
 Dawson, 
 
 
 Desha, 
 
 
 Eppes, 
 Franklin, 
 
 
 Gannet, 
 
 
 Gardner, 
 
 Gholson, 
 
 Messrs. Rhea, of Pemu 
 
 Goodwyn, 
 
 Rhea, of Tenn., 
 
 Gray, 
 
 Richards, 
 
 Holland, 
 
 Ringgold, 
 
 Johnson, 
 
 Roane, 
 
 Jones, 
 
 Sage, 
 
 Kenan, 
 
 Sawyer, 
 
 Kennedy, 
 
 Seaver, 
 
 Love, 
 
 Seybert, 
 
 Lyle, 
 
 Smilie, 
 
 Macon, 
 
 G. Smith, 
 
 McKim, 
 
 S. Smith, 
 
 McKinley, 
 Mitchell, 
 
 Southard, 
 Troup, 
 
 Montgomery, 
 
 , Turner, 
 
 N. R. Moore, 
 
 Van Horn, 
 
 T. Moore, 
 Morrow, 
 
 Weakley, 
 Whitemll, 
 
 Mum ford, 
 
 Winn, 
 
 Newton, 
 J. Porter, 
 
 .Witherspoon. 
 Wright 65. ' 
 
 P. B. Porter, 
 
 
 Those who votetl'in the negative, are, 
 Messrs. Allen, Messrs. Helms, 
 
 W. Alston, 
 
 Bigelow. 
 
 Blaisdell, 
 
 Breckenridge, 
 
 Campbell, 
 
 J. C. Chamberlin, 
 
 W. Chamberlin, 
 
 Champion, 
 
 Chittenden, 
 
 Davenport, 
 
 Ely, 
 
 Emott, 
 
 Findley, 
 
 Fisk. 
 
 Garaenier, 
 
 Garland, 
 
 Goldsborough, 
 
 Gold, 
 
 Hale, , 
 
 Haven, 
 
 Heister, 
 
 Hubbard, 
 
 Hufty, 
 
 Huntingtori, 
 
 Jackson, 
 
 Jenkins, 
 
 Key, 
 
 Knickerbacker, 
 
 Lewis, 
 
 Livingston, 
 
 Matthews, 
 
 M'Bryde, 
 
 M'Kee, 
 
 Miller, 
 
 Milnor, 
 
 Moseley, 
 
 Newborn , 
 
 Nicholson, 
 
 Pearson, 
 
 Pickman, 
 
 Pitkin, 
 
 Messrs. Pottor, 
 
 Quincy, 
 Ran 
 
 indolph, 
 Sammons, 
 Scudder, 
 Shaw, 
 Sheffey, 
 Smelt, 
 J. Smith, 
 Stanford, 
 Stanley, 
 Stephenson, 
 Sturges, 
 Swoope, 
 Taggart, 
 Tallmadge, 
 Thompson, 
 Van Dyke, 
 Van Rensselaer, 
 Wheaton, and 
 Wilson 64. 
 
ON THE BILL* TO RENEW THE CHARTER OF 1 91. 275 
 
 [There were absent on this vote eleven members, viz: 
 Messrs. Burwell, Messrs. Cobb, Messrs. Ross, 
 
 Crist, Livermoore, Tracy, and 
 
 Cook, Lyon, Whitman. 
 
 Clopton, Root, 
 
 Of whom Messrs. Harwell, Crist, Cook, Livermoore, Lyon, Ross, and 
 Whitman, were absent from the city, and Messrs. Clopton, Cobb, Root, and 
 Tracy, were absent from indisposition and other causes,] 
 
 On this day, Messrs. RHEA, of Tennessee, SMXLIE, MACON, and EPPES* 
 spoke in favor of the postponement, and Messrs. QUINCY, STANLEY,} and 
 McKEE, against it; whose speeches, so far as they are found reported, follow 
 in the order above named. 
 
 Mr. RHEA, (of Tennessee.) If, in the course of this debate, observations 
 had not been made which appear to deprive the constitution of the United 
 States of its innate virtue ami honor, to destroy its beauty and simplicity, and 
 to transform it into a deformed and distorted something, the debate on this 
 bill to renew the charter of the Bank of the United States would have pro- 
 gressed to the end, undisturbed by any intervention of mine. If a train of 
 reasoning be adopted, that tends to disturb this constitution, and to give to it 
 a construction and interpretation that it will not bear,it then becomes a duty 
 to state opinions respecting it, and to vindicate the true intent and express 
 understanding thereof. 
 
 The constitution was solemnly and deliberately made, by wise men, who 
 composed the convention, in the name of the People of the United States, and 
 it was solemnly and deliberately ratified, by conventions of the States, re- 
 spectively. It is simple, and easy to be understood, by anyone who, knowing 
 the objects and ends for which it was ordained, will candidly examine it. A 
 defence of the constitution, is a defence of the %reat and good men who made 
 it what it is: for, if the constitution be dark, of obscure intent, and dubious 
 meaning, it is not what it ought to have been. If it be dark, obscure, and du- 
 bious, it it be capable of inconsistent or contrary interpretation, the conven- 
 tions of the ratifying States have not examined it with that careful attention 
 which it required. Vain and empty surmises will evaporate, the characters 
 of the men who made it being considered; the scrutinizing inquiries of the seve- 
 ral ratifying conventions being contemplated, and by a candid examination, 
 without prejudice of the constitution itself. 
 
 The constitution is a compact between the individual States and the Unit- 
 ed States. It is the great charter and bill of rights, delegated and given by 
 the several States composing the Union, to the United States; it contains 
 rights, powers, and principles, to be acted on by the United States, in order to 
 form a more perfect union, establish justice, ensure domestic tranquillity, pro- 
 vide tor the common defence, promote the general welfare, and secure the 
 blessings of liberty; and we, " the People of the United States," have or- 
 dained and established it the constitution of the United States of America. 
 
 I he rights, powers, and principles, enumerated in the constitution, are void 
 of elasticity; they are firm, fixed, and unbending; they will not yield to dis- 
 cretion, on various assumed constructions; unchangeable in their nature, in- 
 tent, and object, they are mutable only by the constitutional authorities. 
 
 Ihe enumeration, in the constitution, of certain rights, shall not be con- 
 strued to deny, or disparage others, retained by the People." Article eleventh 
 of the amendments to the constitution. This article manifests, that all 
 the rights delegated to the United States are enumerated in the constitution, 
 and the enumerated rights shall not be construed to deny or disparage, to 
 bring into disrepute, or diminish, other rights, retained by the People; and to 
 that end it is absolutely necessary that the rights delegated be expressly and 
 distinctly enumerated, otherwise it would be impossible to ascertain and 
 distinguish the rights delegated to the United States, and the rights reserved 
 to the People. ' The powers not delegated to the United States by the con- 
 
276 BANK OF THE UNITED STATES. 
 
 stitution, nor prohibited by it to the States, are reserved to the States, respec- 
 tively, or to the People. " Article twelfth, amendments to the constitution. By 
 this article, it is manifest that a power, not distinctly and expressly delegated 
 to the United States, by the constitution, nor expressly and distinctly pro- 
 hibited by it to the States, is reserved to the States, respectively, or to the 
 People. These amendatory articles exclude, and prohibit an assumption of 
 discretionary powers; of constructive powers; and of all powers and rights 
 not expressly and distinctly enumerated in the constitution. By the word 
 "power," or the word "right," is understood a fundamental principle of the 
 constitution; the Congress cannot change, alter, vary, or destroy it; it assume* 
 form when it is clothed with a legislative act of the Congress, and. ordered to 
 operate. 
 
 It may be proper to notice some observations, made in the course of this de- 
 bate, which appeared to evidence a disposition to show that the Congress was- 
 vested with discretionary, or constructive powers, in matter of principle. It 
 has been intimated that Congress had not power to disband an army, if the 
 power was not assumed. If the constitution had been well considered, this 
 and other similar intimations would have been omitted. An arniy is raised in 
 consequence of a law, bottomed on the clause in the eighth section of the said 
 article, which empowers Congress to raise and support armies. By the eighth 
 section, the Congress is empowered to "make rules for the government and 
 regulation of the land and naval forces." And the Congress is prohibited to 
 make an appropriation of money to support an army, for a longer term than 
 two years. The Congress, acting on these powers,, will disband an army. A 
 law may be made to expire by limitation in itself; if not, the Congress will 
 make a law to repeal it. A law may be enacted to repeal the law whereby 
 an army is raised, and then that army will be disbanded. The writ of ha- 
 beas corpus is a prerogative writ of the United States, and was in use previ- 
 ous to the existence of the constitution; it is not prohibited by the constitution 
 to the People; it is a duty of the judiciary to issue writs of habeas corpus, 
 proper cause being shewn. The privilege of that writ does not depend oi>. 
 the clause in the ninth section of the first article of the constitution; that 
 clause only contains an express condition or reservation, that the Congress 
 shall not suspend the privilege of the writ of habeas corpus, except when, in 
 cases of rebellion or invasion, the public safety may require it. Writs of ha- 
 beas corpus being issued by the judiciary, a law suspending the privilege of 
 that writ is a law regulating the proceedings of the judiciary, and is bottomed 
 on the powers vested in the Congress, by force of the third article of the con- 
 stitution. " No bill of attainder or ex post facto law shall be passed.*' This is 
 an express prohibition, and requires no illustration. " No title of nobility 
 shall be granted by the United States." This, also, is an express prohibition. 
 The Congress hatn power 4 " to provide and maintain a navy," and to make 
 rules for the government and regulation thereof; and, " to define and punish 
 piracies and felonies, committed on the high seas, and offences against the 
 laws of nations;" and consequently, to make rules and regulations for the go- 
 vernment of seamen of every description. It has been asked, by what dele- 
 gated power does Congress make laws to prevent settlers on lands, the In- 
 dian title whereof hath not been extinguished? If the gentleman woo made 
 the inquiry had considered that land, the Indian title whereof was not extin- 
 guished, remained, by treaty, for the use of the Indian tribe, until the extin- 
 guishment of title, and that, a treaty being a supreme law of the land, the 
 Congress is empowered to give it complete effect, the inquiry, probably, would 
 not have been made. 
 
 It is urged, that a discretionary power is necessary to carry the enumerat- 
 ed powers into effect. If the discretionary power alluded to intends only a 
 power to legislate on the delegated right or power, in a proper time and ade- 
 quate manner, this is no more than a power to make laws to cany the dele- 
 gated power into execution; but, if, by "discretionary power," is intended a 
 power to assume, at discretion, a right, or principle, not enumerated in the 
 constitution, under pretence of carrying a delegated power into execution, it 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 077 
 
 is denied that the Congress hath that power: for, if a delegated power cannot 
 be carried into execution without assuming, at discretion, a right not delegat- 
 ed, it will only prove that the constitution, in this respect, is deficient, and 
 requires amendment, and will not prove that Congress, to effect a measure, 
 may, at discretion, do an unconstitutional act. 
 
 It hath been argued, that the convention left Congress to adopt the means, 
 as circumstances might admit, to carry the delegated powers into effect. 
 What is intended by the word means, ought to have been explained in a con- 
 stitutional, not a discretionary manner. To produce an effect of a general 
 nature, the means ought to be commensurate and co-extensive. Water is a 
 means to allay the thirst of all mankind, and there is no substitute. Ships 
 and sea vessels are a means of carrying on commerce between nations sepa- 
 rated by the ocean, and there is no substitute. The constitution vests Con- 
 gress with power to regulate commerce with foreign nations; but no man will 
 believe that, in virtue of that power alone, the Congress would attempt, by a 
 discretionary, or a constructive power, to adopt another principle; that is, to 
 provide and maintain a navy to protect commerce. 
 
 The last clause of the eighth section is in the following words: "And to 
 make all laws (that is, Congress shall have power to make all laws) which 
 shall be necessary and proper for carrying into execution the foregoing pow- 
 ers, and all other powers vested by the constitution in the Government of the 
 United States, or in any department or officer thereof." 
 
 This is the clause \\hich is called the sweeping clause, pretending to u>.-a 
 all powers and authorities, although not expressly enumerated. It may be 
 proper here to inquire what is intended by the words, " and all other p;>\\ers 
 vested by this constitution in the Government of the United States, or in any 
 department or officer thereof," or what are the powers intended by.the words 
 " all other powers," inasmuch as it is probable that an opinion may have ob- 
 tained, that, by these words air understood some hidden occult powers, not 
 expressly enumerated in the constitution; that these powers are for the pecu- 
 liar exercise of discretion, and that they are certain discretionary powers, to 
 be discovered and assumed in extraordinary cases, If any such opinions are. 
 entertained, a careful examination of the constitution will dissipate them. 
 Powers, other than those enumerated in the eighth section of the first article 
 of the constitution: these powers mighl all be mentioned, but that is unneces- 
 sary; some of them will be noticed. " Congress have power to provide by law- 
 Tor taking a census of all the People of the United States, every ten years.*' 
 Congress hath power to appoint, by law, a day to convene, other than the first 
 Monday of December. To determine, bv law, the time for choosing electors 
 of President and Vice President of the United States. 
 
 Section ith, of first article: *' The times, places, and manner, of holding 
 elections for Senators and Representatives, shall be prescribed in each State, 
 by the Legislature thereof; but the Congress may, at any time, by law, make 
 or alter such regulations, except as to the places of choosing Senators." 
 
 "To make laws respecting the District of Columbia." " To declare the 
 punishment of treason." Several of those powers, denominated *' other pow- 
 ers," are enumerated in the 9th and 10th sections of the 1st article of the 
 constitution. Congress have power, by law, to establish courts, inferior to 
 the supreme court. Congress have power to make all needful rules and re- 
 gulations respecting the territory and other property of the United States. 
 This enumeration may at present be sufficient to show what powers are in- 
 tended by the words "* other powers," and, also, to manifest, incontrovcrti- 
 bly, that the words t; and all other powers vested by this constitution in the 
 Government of the United States, or in any department or officer thereof," 
 refer only to powers expressly and positively enumerated in the constitution, 
 and by it vested in the Government of the United States; that, by these 
 words are not understood, as some may have fondly imagined, any powers of 
 discretion, fitted, when discovered, to fill chasms in the constitution of the 
 United States; and that, by these words are not to be understood some con- 
 cealed occult powers, waiting to be revealed by superior wisdom, to meet par- 
 ticular purposes, for instance, the creation of the Bank of the United States, 
 
278 BANK OF THE UNITED STATES. 
 
 or to be dragged out, by main force, to support unconstitutional pretensions. 
 In the constitution are clearly expressed and enumerated, all the powers, 
 rights, and principles, which have been vested in the Government of the Unit- 
 ed States, or in any department or officer thereof, by the individual States 
 ratifying the constitution; nothing is left in obscurity, or difficulty^ and this 
 constitution is not elastic it will not bend to discretionary opinions. 
 
 I will now, said Mr. Rhea, with all due respect, approach the main ques- 
 tio n of inquiry, viz.: Is a power or right to create the Bank of the United 
 States, expressly enumerated, to be vested, or intended to be vested in Con- 
 gress, by the eighth section of the first article of the constitution? It may be 
 previously observed, that if, in the ninth section ot the first article, there 
 had been even a negative expression or enumeration of power or right, in- 
 serted, empowering Congress to create the Bank of the United States, as if 
 it had been stated in the words following, or words to the same effect: u Con- 
 gress shall not create the Bank of the United States prior to the year one thou- 
 sand eight hundred," there might have been some reason to presume upon. 
 But a negative expression of a power or right of that import, is riot in the ninth 
 section enumerated, nor in any other section of the constitution. The words 
 in the eighth section of the first article of the constitution, which have caused 
 such amazing solicitude and inquiring anxiety, to discover some obscure oc- 
 cult power or right to create the Bank of the United States, are the fol- 
 lowing: " Congress shall have power to lay and collect taxes, duties, imposts, 
 and excises, to pay the debts, and provide for the common defence and gene- 
 ral welfare of the United States,'" " and (as expressed in the last clause of 
 the section) to make all laws which shall be necessary and proper for carry- 
 ing into execution the foregoing powers, (that is, the powers enumerated in 
 the eighth section) and all other powers (that is, powers enumerated in other 
 sections of the first article, and enumerated in other articles of the constitu- 
 tion) vested by this constitution in the Government of the United States, or in 
 any department or officer thereof." Let these words be carefully and atten- 
 tively examined, and all obscurity and difficulty will be removed ; let them 
 be connected in the manner they were intended to be connected, and there will 
 be no reason to presume some unknown occult power, on which a pretension 
 to create the Bank of the United States can exist. " Congress shall have 
 power to lay and collect taxes." Let the words be connected, so that they shall 
 read, kt Congress shall have power to make all laws necessary and proper to 
 lay and collect taxes, duties, imposts, and excises." Here, said Mr. Rhea, a 
 question presents itself, that is to say, for what purpose shall Congress have 
 power to make all laws which shall be necessary and proper to lay and col- 
 lect taxes, duties, imposts, and excises? The first clause gives the answer: 
 " To pay the debts, and provide for the common defence and general welfare of 
 the United States." The expression of the delegated power or right will then, 
 in plain and intelligible language, be, " Congress shall have power to make 
 all laws which shall be necessary arid proper to lay and collect taxes, duties, 
 imposts, and excises, to pay the debts, and provide for the common defence 
 and general welfare of the United States." This reading presents to the 
 mind clear and distinct ideas, removes doubtful interpretation, and establish- 
 es the truth contained in this section of the constitution. Let this reading be 
 prefixed to every clause in the eighth section, the propriety thereof will be 
 more apparent: for instance, Congress shall have power to make all laws 
 which shall be necessary and proper to borrow money on the credit of the 
 United States, to pay the debts and provide for the common defence and gen- 
 eral welfare of the United States. And here let it be observed, that the 
 words " for the common defence and general welfare of the United States," 
 are words of limitation and restriction, and not of amplification of powers; 
 these words direct to the end for which all taxes, duties, imposts, and ex- 
 cises, shall be laid and collected, and it follows, that taxes, duties, imposts, 
 and excises, shall not be laid and collected for any purpose whatever, other 
 than to pay the debts and provide for the common defence and general wel- 
 fare of me United States. 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 279 
 
 The rights, powers, and principles, delegated by the individual States to 
 the United States, and enumerated in the constitution, are substantial, not 
 formal; and, beine substance, are unchangeable in their nature, and must con- 
 tinue until altered by the constitutional authorities. An institution or princi- 
 ple, which has power to put bank paper in the place of gold and silver, is sub- 
 stantial, not formal; and never can be fixed as a form, by way of appendage to 
 the business of collecting taxes, duties, imposts, or excises; or by way of ap- 
 pendage to aid commerce, or to borrow money; with as much propriety may 
 it be said to aid in establishing an uniform rule of naturalization, or in mak- 
 ing uniform laws on the subject of bankruptcy throughout the United States. 
 A principle, or a right or power to create the Bank of the United States, is 
 not inserted or enumerated among the rights and powers enumerated in the 
 eighth section of the first article, nor in any other section of the constitution. 
 Let it not, then, be presumed, that the convention who made the constitution, 
 or the ratifying States, did, in an occult and obscure manner, vest the Go- 
 vernment of the United States with a right or power to create the Bank of the 
 United States, in the manner and form belonging to the bank, the charter of 
 which labors to be renewed. The constitution contains no enumeration of a 
 principle which can give any pretence for such presumption. 
 
 In the eighth section of the first article are enumerated rights and powers 
 of minor importance than a right to establish the Bank of the United States. 
 The right to establish uniform laws on the subject of bankruptcies throughout 
 the United States, is of minor importance: that right is enumerated. Cer- 
 tainly, then, if the convention, or the ratifying States, had designed to ve^t 
 Congress with the right to create the Bank of the United States, that, right 
 would have been expressly enumerated in the constitution. 
 
 By virtue of the eighth section of thelfirst article of the constitution, " Con- 
 gress shall have power to make all laws which shall be necessary and proper 
 to promote the progress of science and useful arts, by securing, for limited 
 times, to authors and inventors, the exclusive right to their respective writ- 
 ings and discoveries." The insertion of that right or power affords sufficient 
 reason to conclude, that, if the convention had intended to delegate to the 
 
 shall not be construed to deny or disparage others, retained by the People." 
 Eleventh article of amendments to the constitution. Here, then, it may pro- 
 perly be observed, that the rights enumerated in the constitution are certain, 
 that is, identically and distinctly enumerated rights; and that those rights shall 
 not be, by discretion, construed to deny or disparage other rights reserved to 
 the People. A right or power to establish the Bank of the United States is 
 not enumerated in the constitution; that right or power, therefore, is not de- 
 nied to the People, and the certain rights enumerated in the constitution shall 
 not be construed to deny that right to the People; that is, to the People in 
 their individual State capacities. " The powers not delegated to the United 
 States, by the constitution, nor prohibited by it to the States, are reserved to 
 the States, respectively, or to the People." Twelfth article of amendments to 
 the constitution. The eighth section of the first article of the constitution 
 enumerates certain powers or rights delegated to the United States; the tenth 
 section of the first article enumerates certain rights prohibited expressly, or 
 conditionally, to the respective States; but, in the tenth section, orinany other 
 section of the constitution, a right to create bank institutions is not prohibited, 
 absolutely or conditionally, to the respective States or to the People; that 
 right, therefore, is not delegated to the United States, but is reserved to the 
 respective States or to the People. The States, respectively, have legislated 
 on that power and right reserved, and have established bank institutions, and 
 the United States have not interfered to prevent them. 
 
 In the eighth section of the first article of the constitution^ right is enume- 
 rated : " The Congress shall have power to exercise exclusive legislation in all 
 cases whatsoever, over such district (not exceeding ten miles square) as may. 
 
BANK OF THE UNITED STATES. 
 
 by cession of particular States, and the acceptance of Congress, become the 
 seat of Government of the United States." The power delegated to the Con- 
 gress by virtue and force of this clause, is eminently great, and requires no il- 
 lustration to prove that Congress hath power to create bank institutions in the 
 District of Columbia. 
 
 In favor of a renewal of the charter of the Bank of the United States, it is 
 argued, that the Congress, having power to lay and collect taxes, duties, itn 
 posts, and excises, hath also power to establish the Bank of the United States, 
 as a mean to aid in collecting taxes, duties, imposts, and excises. It vyill not be 
 said that the Bank of the United States is an essential necessary means in collect- 
 ing taxes, duties, imposts, and excises: for, experience hath proved, that taxes 
 have been collected without the aid of that bank. But, if it be a means essen- 
 tially necc ssary to collect taxes, it ought to be as extensive in operation as the 
 law for collecting taxes: the nature of the bank institution proves that it can- 
 not be co-extensive witn the law for collecting taxes. Ten dollars being the 
 lowest sum for which a bill of that bank is issued, it is manifest that bills of 
 ten dollars, twenty dollars, fifty dollars and upwards, cannot aid generally in 
 collecting and paying taxes; admitting the circulation of these bills to be co- 
 extensive with the operation of the law. The tenth section of the act, entitled 
 An act to incorporate the subscribers to the Bank of the United States, pro- 
 vides, " that the bills or notes of the said corporation, originally made payable, 
 or which shall have become payable on demand, in gold or silver com, shall 
 be receivable in all payments to the United States." But. notwithstanding 
 the bills or notes of that corporation shall be receivable in all payments to the 
 United States, as is provided for in that section, the act alluded to doth not 
 provide that the bills or notes of that bank shall be receivable in all payments 
 to citizens of the United States. The Bank of the United States, therefore, 
 cannot be an adequate means to collect taxes from all the citizens of the Unit- 
 ed States; and, if not from all the citizens of the United States, the operation 
 of the bank will be partial, and, consequently, injurious to the People. 
 
 By the tenth section of the law alluded to, the bills and notes of the corpo- 
 ration, established by that law, are made receivable in all payments to the 
 United States. The bonds for payment of duties and imposts on foreign mer- 
 chandise, imported into the United States, are generally deposited in the bank 
 of that corporation, or in the respective branches thereof; whatever benefit or 
 advantage, if any, arises by collection of those duties and imposts, accrues to 
 that corporation; whatever gold and silver is paid on account of those duties 
 and imposts, it remains at the disposition of the corporation, by reason that 
 the corporation, by the law, are enabled to pay the amount of all the duties 
 and imposts to the United States in bills and notes; these bills and notes 
 afterwards come into the hands of the agents and public functionaries of the 
 United States, and by them are paid to the citizens, and by this operation the 
 bills and notes of the corporation obtain a circulation, to a certain extent, 
 among the People, and, notwithstanding they may not be a legal tender in 
 payment of debts by one citizen to another, they do, nevertheless, acquire a 
 degree of currency, by being, in the first instance, made payable to the Unit- 
 ed States; by this operation, bottomed on the tenth section of the law, the 
 corporation have the advantage of retaining the precious metals in their vaults 
 until an opportunity offers to dispose of them to the best advantage, or to ex- 
 port them to foreign countries. Other observations might be made respecting 
 the operation of the law incorporating the subscribers to the Bank of the 
 United States; but, what alreacly hath been observed may be sufficient to ex- 
 cite reflection on the machinery and influence of the mighty engine which the 
 stockholders of the Bank of the United States have in their power, at any 
 time, for any purpose, to set in motion. The instrumentality of this engine 
 pervades the. United States in all elections; it can raise up and put down; it 
 may say, " I can raise you to a conspicuous and exalted station, if you obey 
 my directions, and if you do not, I can put you down." If an institution of 
 this magnitude is good for the People ot the United States, if its influence is 
 for their benefit, let it be demonstrated. Suppose the citizens would refuse 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 281 
 
 to receive the bills ami notes of that corporation in payment of debts, what 
 would be the consequence? Why, let us not say ruin to all would follow; but 
 certainly many would be injured. 
 
 It has been said, that the Bank of the United States aids commerce. If it 
 does, it must be in a manner very unimportant to the People of the United 
 States in general. The bank may be a convenience to all who have to pay, in 
 the first instance, duties and imposts on merchandise imported into the United 
 States, and that benefit to them operates to throw on all the other people of 
 the United States a prodigious mass of paper in place of gold and silver: the 
 evident effect of which is to substitute the bills and notes of that bank in 
 place of the precious metals, and to give that bank the power of commanding 
 the medium of trade in the United Strtes. 
 
 The action of the bank is within the United States and territories thereof: 
 the bills and notes thereof, as has been observed, are made receivable in all 
 payments to the United States; but the assumed position, " that the bank aids 
 commerce," not satisfied with what has been said, relative to the manner in 
 which it aids commerce, returns, and requires further explanation, and it is 
 proper to give that explanation. The annual reports of the Secretary of the 
 Treasury show the prodigious amount of goods, wares, and merchandise, every 
 year imported into the United States from foreign countries, and particularly 
 from Great Britain, and the dependencies and colonies thereof. Will any of 
 the gentlemen who favor a renewal of the charter of the Bank of the United 
 States, as it is called, inform this House, whether any part, and, if any, what 
 .part, or to what .amount of the cost of the goods, wares, and merchandise, im- 
 <! into the United States, is actually paid for, to the merchants in foreign 
 countries, to whom the orders are sent, in bills and notes of that bank, such 
 as are passing among the People of the United States? If such payments are 
 made in such bills and notes, then, indeed, there will be reason to contend, 
 that that bank aids commerce in its operations. If that information is not ob- 
 tained, it will be taken for granted that no such payments are made in the 
 bills or notes of fhat bank. The fact, then, appears to be, that the bills and 
 notes of that bank do not pass out of the United States and territories thereof, 
 to any foreign nation, in payment lor the merchandise imported from that na- 
 tion, and that no merchant of any foreign nation will receive bills and notes in 
 payment for the merchandise ordered. The effect of all this is, that gold and 
 silver is exported to foreign countries to pay for the goods, wares, and mer- 
 chandise, imported, after deducting from the gross amount of the value thereof 
 that part which may have been paid for in produce of the United States. The 
 consequence of which is, that the precious metals are drained from the United 
 States, and the paper of the bank circulates among the People, in the place of 
 old and silver. If that cause is suffered to continue to operate, a time may 
 ot,be far distant when the paper of that bank will be the only visible medium 
 <>f trade among the People; and a piece of gold or silver coin (notwithstanding 
 the mint hath issued great quantities thereof) will be rare to be seen. It is 
 said, that the bank hath been aiding to agricwlture. If it be so, it is strange 
 that the agricultural part of the community have sent no petitions r memorials 
 
 c \ i i i * j-~. WWW*M Mfc< wavuuwcfc 
 
 tion of that bank charter, and a portion of the merchants. 
 
 It has been urged, that, if the bank charter is not renewed, ruin and destruc- 
 tion almost universally will fall on the People of the United States. These 
 declarations, said Mr. R. affect me not, because I place no confidence in them 
 An agricultural people cannot be ruined, until it shall please the Almighty to 
 prohibit the return of the seasons in their regular time, until it shall please 
 him to dry up the fountains of rain, and say that there shall be no more seed 
 time nor harvest. But, if this bank is of such mighty force, that its fall will 
 produce these direful effects, it is more prudent to meet them now, than to 
 <lelay them to a future period. This nation is as well prepared to meet them 
 now, as it will be hereafter. 
 
BANK OF THE UNITED STATES-. 
 
 t It hath been said, and insisted on, that the bank hath aided the Government 
 in its fiscal operations, and that the Government cannot well do, or do well, 
 without it. Let it rather be said, that the Government hath aided (he bank, 
 raised it into existence, and afforded it every support, by placing in its hands 
 the collection and deposition of the revenues of the Government for twenty 
 years; bv receiving trom the bank its paper, in place of gold and silver, and 
 thereby leaving gold and silver to be used to the benefit of the bank corpora- 
 tion. The bank may have been, to a certain extent, convenient in carrying 
 on the fiscal operations of the Government, but it will not be said to be an in- 
 stitution profitable to the great mass of the People of the United States, neither 
 will it be believed to be an institution aiding, in its action and influence, the 
 republican institutions of the People of the United States. 
 
 The law creating the Bank of the United States, or, in other words, the 
 bank called the Bank of the United States, is not bottomed on the constitu- 
 tion; it is inconsistent with, and repugnant to, the constitution. A constitu- 
 tional Government requires no aid; can have no aid from an unconstitutional 
 principle. The great men who made the constitution, and the ratifying States, 
 have declared, that, as it is, they made and ratified it, and the People of the 
 United States adopted it for the purposes therein enumerated and delegated; 
 and if the Government cannot exist in virtue and by force of the powers, 
 rights, and principles, expressly enumerated and delegated in the constitution, 
 without the aid of a principle violating the constitution* it is time that there 
 should be another grand convention, with powers to make another constitu- 
 tion. But, in my opinion, said Mr. R , the rights, powers, and principles, 
 expressly enumerated and delegated in the constitution, are completely ade- 
 quate, to all intents and purposes, for the existence of the Government, with- 
 out the aid of any principle, inconsistent with, and repugnant to, the consti- 
 tution. 
 
 Mr. EPPES said that he apprehended the few remarks he had to offer to the 
 House, would not be considered as well timed, after the funeral oration had 
 been pronounced over the expiring charter of the United States' Bank. Pie 
 would trespass but a short time on the patience of the House, and confine his 
 remarks to the policy of renewing the charter, viewed only as a national mea- 
 sure, lie considered it unnecessary to say any thing on the constitutional 
 question. If ever the theory of persons who believe that political principles 
 may be demonstrated with mathematical certainty, shall be realised, and a po- 
 litical Euclid be published, I would put, for the first proposition, these prin- 
 ciples: 
 
 1. That all power not delegated, is reserved to the States, or to the People. 
 
 2. That the power to incorporate a bank is neither delegated, or essentially 
 necessary for carrying into eft'ect any delegated power. For the demonstra- 
 tion, I would insert the speech of a gentleman from New York, (Mr. PORTER) 
 who has combined in a masterly manner on this subject, the purest principles, 
 and most luminous elucidation. Passing over, therefore, this part of the ques 
 tion, I shall confine myself to such observations as will tend to show that the 
 renewal of the charter is not necessary for the prosperity of agriculture and 
 commerce, as has been stated; that the union of a moneyed institution with a 
 Government, possessing the powers of war and peace, is dangerous to lepub- 
 lican institutions; that the dissolution of the charter will produce no injury 
 to the public, or to individuals; that the same principles which induced the 
 republican party, in the year 1790, to oppose the incorporation of this bank, 
 ought to prevent a renewal of the charter at the present time. In examining 
 the first of these questions, viz. the operation of the dissolution of the char- 
 ter on agriculture and commerce, I will not trouble the House with any gene- 
 ral observations on the subject of banks. Their tendency to facilitate com- 
 merce, so long as their circulation of paper rests on specie, or floating capital, 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. <83 
 
 dangerous to the community. A particular specified object, say agriculture 
 or commerce, can only employ a certain capital. An increase of circulating 
 medium, above the sum necessary for a particular object, must produce one 
 of two effects either to depreciate the medium, be it specie or paper, or to 
 drive it into new channels. These are plain, obvious principles, which no 
 gentleman will, I presume, deny. Let me ask, then, 1st. \\ hat amount of 
 paper medium can with safety be employed in the commerce of the United 
 States? 2. What amount can be> put into circulation by the present existing 
 banks, independent of the United States' Bank? The real basis of a srfe paper 
 circulation, so far as it respects commerce, is the productive labor of a com- 
 munity above its consumption. What a nation does not consume, it exports. 
 No paper circulation, therefore, can with safety be extended beyond the 
 amount of the exports of a nation. Indeed, it ought not to exceed in amount 
 the domestic exports which constitute, the only certain part of the .productive 
 labor of the community, so far as respects commerce. The export of foreign 
 articles depends so much on circumstances over which we have no control, 
 that a paper currency which rested for redemption on that, would be liable, 
 whenever commerce wns interrupted, to produce general ruin and bankrupt- 
 cy. The domestic exports of the United States may be considered in value 
 as equal to $40,000,000. The export of foreign articles, in the year 1807, was 
 near 860,000,000. This great export of foreign articles was produced by par- 
 ticular circumstances, which no hiiisi'r exist During favorable years, viz. 
 1803, 1804, 1805, the export of foreign and domestic articles averaged 
 76,000,000; so that it would appear, taking the domestic and foreign exports 
 
 circulation, in credit and mte.s, $19,000,000; 14,000.000 in accommodation 
 credit, exclusive of mortgages :-.nd bonds, and constituting active circulating 
 medium, and five millions in note.. A^ a moneyed institution, it is admitted 
 that their affairs have been well managed. Other banks, therefore, may cir- 
 culate to the same amount, in proportion to tht;ir capital. 
 
 The bank capital of the I 'nitcd States, exclusive of the United States' Bank, 
 is $50,000,000 five times the capital of the United States' Bank; of course, 
 supposing them to manage their affairs as well, they can put into circulation, 
 in credit and notes, five times the amount put into circulation by the United 
 States' Bank: five t!ni"s 19.000,000 is $95,000,000. This sum, sir, is fifty-five 
 millions above our domestic exports: forty-five millions above our consump 
 tion: nineteen millions above our whole export, domestic and foreign, in favor- 
 able years: twenty six millions above the present export of domestic and fo- 
 reign articles. 
 
 Can any gentleman, on this statement, believe we want ability to circulate 
 paper medium for commercial purposes? Our export of foreign articles, from 
 the peculiar situation of the world, has almost disappeared. Our merchants 
 are more in want of a field to exercise their capital man of capital itself. It 
 is a fact, which cannot be denied, that we have at present a surplus capital 
 which cannot be employed in commerce, and that the paper circulation is in- 
 creasing in a ratio neither proportioned to our population, consumption, or 
 wealth. 1 have confined my observations entirely to the view of a capital, 
 such as is necessary for commerce. No gentleman has advocated the renewal 
 of the charter for the purpose of creating a capital for internal improvement. 
 This appears by general consent to have been considered as more properly 
 within the sphere of the several State Legislatures. At the time this charter 
 was originally granted, the situation of the United States was very different 
 from what it now is; but three banks existed, with a capital of less than three 
 millions of dollars; our exports amounted to less than 19,000,000. Our com- 
 merce languished for want of circulating medium; we are now in danger of 
 suffering from a paper currency, resting on no solid basis, and liable, with a 
 reverse of fortune, to recoil on ourselves. I cannot, therefore, consider the 
 
284 BANK OF THE UNITED STATES. 
 
 renewal of the charter, viewed only as a measure of general policy, necessary 
 for the creating capital, for purposes of commerce, 
 
 But, sir, said Mr. E,, I object to the union of a moneyed institution with a 
 government, as dangerous to republican principles. Next to frequent elec- 
 tions, the great security in every country, against arbitrary power, is the de- 
 pendence of the Government on the great body of the People for supplies. 
 Hence, the objections to a revenue dependent on loans, indirect taxes, &c. 
 Money has been aptly termed the sinews of war. It may, with equal propri- 
 ety, be termed the sinews of oppression and usurpation. The facility of com- 
 manding large sums by means of a moneyed capital, dependent on the Govern- 
 ment, is calculated to destroy the dependence of the Government on the Peo- 
 ple. If we look at the history of England, we shall find that their short pe- 
 riod of liberty was while the king was dependent on the commons for supplies. 
 The creation of a great moneyed capital in that country, under the control of 
 the Government, has totally destroyed that valuable feature in the English 
 constitution. It has created a body of men who contribute to the prodigality 
 of the Government; who furnish the means and share in the spoils of the na- 
 tion. The history of the Bank of England and of its paper system is one 
 which ought to warn the friends of freedom against the danger of a union be- 
 tween a Government and paper capitalists. This species of capital, which 
 scarcely knows a limit, is dangerous to the freedom ot a country, without be- 
 ing nourished by the fostering hand of Government. Unite the two, give to 
 a Government, by means of a paper system, a power to supply its wants with- 
 out a recurrence to the People, and you unite the most formidable en- 
 gines of oppression, power and means. It is this system which has caused 
 the British Government, after mortgaging from year to year its revenues to 
 the bank, to accumulate a national debt to the enormous amount of six hun- 
 dred and seventy millions of pounds sterling. The average quarterly advan- 
 ces of the Bank of England to the Government, in the year 1797, was four 
 times the whole amount discounted for individuals. From these extraordi- 
 nary advances, produced by the union of the Government and the bank, it 
 must have failed in the year 1797, but for the interposition of Parliament. On 
 the 26th day of February, 1797, the cash and bullion in the bank amounted to 
 1,272,000; average notes in circulation, to 8,640,250; bills discounted, to 
 2,905,000; advances to Government, to 10,672,490. From the report of 
 the committee appointed by Parliament in February, 1797, to examine into 
 the state of the bank, it appeared that the debts of the bank amounted to 
 13,770,390; that its assets, exclusive of the permanent debt from the Govern- 
 ment (and what these assets were does not appear) amounted to 17,597,298; 
 leaving in favor of the bank 3,826,903. This sum of 17,597,298, consist- 
 ing of debts and assets, was not sufficient to meet their cash debts, amounting 
 to 13,770,390. At tnis time the permanent debt due from the Government 
 to the bank amounted to 11,686,800 almost four times the whole sum left 
 in the bank after payment of its debts. The funds of the bank being in the 
 hands of the Government, the Government, unable to pay, kindlyinterposed 
 to save the bank from ruin, and made their paper a tender. This, sir, was 
 one of the blessings produced by a union between the Government and the 
 bank. 
 
 But, sir, many gentlemen have exercised their ingenuity in portraying the 
 ruin which must tall on individuals, and the injury which must be sustained 
 by the public, from a dissolution of the charter. From the statement just laid 
 on our table from the Treasury Department, it appears that the stockholders 
 of the bank are in more danger than the community. 
 
 From that statement we find that the debts due by the bank, 
 and payable on demand, amount to - - $13,673,369 
 
 To meet this debt, the bank has on hand, in cash, - - 5,009,567 
 
 Notes and debts due from other banks, 1,313,350 
 
 Making, in all, their cash funds amount to $6,332,512 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 Deducting this sum of $6,332,512, vyhich may be considered their cash fund, 
 from the $13,673,369, the amount of their debts, and it will be $7,350,51-2, 
 for the payment of which they must depend on their debtors, and make this 
 payment out of the $14,609,537, due from individuals. So far, therefore, from 
 pressing the community, it appears they must collect $7,350,512, and apply, 
 in addition to it, their whole cash (Vnds, or fail in their engagements. But, 
 sir, I will state it in another way. According to the principles of banking, the 
 profit is annually or quarterly divided; of course the company, on winding up 
 its affairs, can only withdraw its capital, vix: $10,000,000. 
 
 Of this capital, they have in hand, in cash. $5,009,567 
 
 In notes and debts due by other banks, 1,313,857 
 
 In a debt from the United States, 2,750,000 
 
 In houses, 500,000 
 
 In debts in suit, - 154,164 
 
 In bonds and mortgages, - 221,000 
 
 In stock of the United States, 20,000 
 
 Total, $9,968,588 
 
 This, sir, amounts very nearly to their stock, and if they reserve their cash 
 on hand as part of that stock, and meet the payment of their debts with the 
 debts due to them, they have nothing to draw from the community, which can 
 produce the slightest pressure. They may find difficulty in collecting a suf- 
 ficient sum to meet their own engagements, as, from the moment of the disso- 
 lution of their charter, their debts will stand on the same footing with the debts 
 of any other company winding up its attain- , and .r.ust be collected in the saint* 
 manner. 
 
 Much stress, sir, ha* also been laid on the necessity of the bank for the ma- 
 nagement of the finances of the United States. We are told that a complete 
 control is given, by the constitution, over the finances, and that a bank is ne- 
 cessary for their management. The term finance is not to be found in the 
 constitution. The bank is not necessary for the collection of taxes, or imposts, 
 or for paying the debts, to use the language of the constitution. It has never 
 been used for the collection of taxes. For the collection of duties, it is used 
 only in a limited way. We have upwards of eighty-five places for the collect- 
 ing duties, and only nine branch banks. It is used for the payment of the in- 
 terest of the debt only, in consequence of a treasury regulation. Commission- 
 ers of loans, within the several States, are even at this time established by law 
 for paying the interest on the debt. The bank, therefore, is not essential for 
 this object. The great payments for the army and navy are not at present 
 made at bank; paymasters and pursers discharge this duty. All payments on 
 account of the civil list are made at bank, but the greater portion of these are 
 at the seat of Government. A bank is, therefore, not essential for making these 
 payments. Until new arrangements are made, temporary inconvenience may 
 be sustained by the Government. The mere change of agents generally in ex- 
 tensive moneyed transactions, must produce inconvenience. The inconveni- 
 ence, however, will be temporary, and does not deserve consideration in a case 
 involving the constitution. 
 
 I will close my remarks with a few observations tending to show that (he 
 same principles which induced the republican party, in 1790, to oppose the in- 
 corporation of the bank, ought to prevent a renewal of the charter. In a free 
 country there is nothing more important than a frequent recurrence to those 
 fundamental principles which unite in one common bond, those who grant 
 power, and those who exercise it. The peculiar organization of the Govern- 
 ment of the United States combines, in a single charter, powers administered 
 by men deriving their authority from two separate and distinct sources, the 
 People and the States. The weakness of the old confederation, which, al- 
 though armed with general powers, was found unequal to giving a practical 
 operation to those powers, produced the federal constitution. This charter, 
 the offspring of compromise, was considered in the convention, by one purty, 
 
286 BANK OF THE UNITED STATES. 
 
 as loo weak to accomplish its objects; by the other, as sufficiently strong to 
 endanger the liberty of the citizen. These two principles were soon manifest- 
 ed in the administration of the present federal constitution. Those who 
 thought it too strong gave to the constitution a rigid construction, and opposed 
 constructive powers. These were termed anti-federalists. Those who thought 
 it too weak, were disposed to engraft vigor on it by construction, and contend- 
 ed for constructive powers. These were termed federalists- The eclat 
 which attended the adoption of the constitution, threw the Government ex- 
 clusively, for years, into the hands of the federalists. Thegreat popularity of 
 General Washington, on whose brow grew, in full vigor, the laureis of the Re- 
 volution, balanced for a time these two contending parties. With the same 
 manly firmness, as, during the Revolution, he stemmed the torrent, and attach- 
 ing himself exclusively to what he deemed the interests of his country, he ad- 
 ministered the constitution according to its true principles. He commenced 
 his career as President, on the 30th of August, 1789. In 1791, the charter of 
 the bank was granted. On this great measure, the two great parties were for 
 __ ihe first time arrayed against each other. It was at that time considered a 
 party question, inasmuch as it involved the very principles on which the par- 
 ties divided, viz: "delegated" powers and '' constructive" powers. Unfortu- 
 nately for his country, General Washington, on this occasion, took side with 
 the federalists. The creation of a moneyed interest, connected with the Go- 
 vernment, was a favorite measure of those who were willing to engraft energy 
 on the constitution, and was warmly opposed by the party, unwilling to add, 
 by construction, the extraneous weight of a moneyed capital to a charter 
 considered, on a fair construction, sufficiently energetic. The defeat of Ge- 
 neral St. Clair took place in the November following the establishment of the 
 bank, and the subsequent disasters of the Indian war, by increasing the wants 
 of the Government, drew more closely the ties of connexion between the fe- 
 deral party and the bank. Through all the periods of the federal administra- 
 tion, this moneyed capital was their shield and their sword. It extended 
 their influence and secured the approbation of most of the large commercial 
 cities in the Union. When this bank was established, but three banks existed 
 in the United States, with a capital of $2, 100,000 dollars. The creation of a 
 bank with a capital of $10,000,000, almost five times the capital of all the ex- 
 isting banks of the Union, under the patronage of the General Government, 
 was calculated to produce and did produce a subserviency on the part of the 
 stockholders, to the views of their party. The influence of this powerful 
 moneyed capital was long felt. Nothing but the multiplication of State banks, 
 and the increase of capital from the peculiar and fortunate circumstances 
 under which the United States were placed, could have emancipated us from 
 the shackles imposed on us by a moneyed interest wielded by foreigners. I 
 rejoice that the period has arrived, when this privileged class must surrender 
 its charter; when the moneyed capital of our country shall no longer be wield- 
 ed as an engine of party ; when the republican party shall have an opportunity 
 of testing the truth of the principles for which they contended in the year 
 1790, and of giving, on the present, as on the former occasion, their support to 
 the principle "That power not delegated is reserved to the States or to the 
 People." 
 
 Mr. STANLEY. Mr. Speaker: After the able discussion which this subject 
 has already undergone, I should not have asked your attention, but for the 
 observations of the gentleman from Virginia, (Mr. EPPES) who has last ad- 
 dressed you. That gentleman, with a view to justify such decision of the 
 question as he desires, has advanced propositions which are in themselves so 
 incorrect, and supported them by arguments so palpably unreasonable, that I 
 shall trouble the House a short time in reply. 
 
 The gentleman tells us it is as true as any mathematical axiom, that a power 
 not expressly granted by the constitution to the federal Government, cannot be 
 exercised by that Government; that, whenever a political Euclid shall be com- 
 posed, this principle should be placed as first, in clearness and importance, and 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 287 
 
 the speech of the gentleman from New York, (Mr. PORTER) on the bill before 
 us, should be added as an appendix or commentary, proving its truth. In 
 terms, sir, the gentleman's proposition is true, but the gentleman has not 
 avoided the error of those who have preceded him on that side ot the question; 
 he confounds the powers of the federal Government with the mean* of execut- 
 ing such powers; he does not distinguish between the objects of the federal 
 compact and the means of ejecting these objects. And upon this hinge ot 
 error did the argument of the gentleman from New York turn. This confu- 
 sion of terms, this indistinctness of perception, as I shall endeavor to show, 
 has led gentlemen astray on this question. If, sir, the political errors ot the 
 statesmen of this day shall ever be collected into a volume, as the first, the 
 most glaringly wrong, and flagrantly unjust, should be placed the axiom of the 
 gentleman from Virginia, which cannot in substance be other than this: ; * that 
 no means of executing a power granted to the federal Government, can be 
 employed by that Government, unless such means be found expressly point- 
 ed out in the constitution. And, sir, to shew how truth may be obscured, 
 and error supported, by ingenuity my respect for the gentleman from New 
 York forbids my saying by sophistry I will append as a commentary the 
 speech of that gentleman on this question. 
 
 With respect to the constitutional right of Congress to incorporate a bank 
 for the prosperous administration of its finance?, the very able arguments al- 
 ready made, and, in my apprehension, very imperfectly met, require little to 
 be said in its support. My view of this part of the subject shall therefore be 
 brief, and 1 may be pardoned for offering it. To incorporate a company, in 
 other words to grant to certain persons a legal or artificial capacity;, distinct 
 from their natural, is an act of sovereignty; a delegation of which, it is true, 
 can only emanate from the sovereign power. If the Federal Government be 
 not sovereign as to any of its object-, tk-y cannot incorporate a company for 
 the attainment of any of its objects. But, if, on the other hand, the Govern- 
 ment is sovereign as to any object, the power to incorporate companies, the 
 fit and necessary means for the attainment of that object, must regularly re- 
 sult from, and be appurtenant to, this sovereignty. This power is not left to 
 inference; the constitution expressly declares that Congress shall have power 
 to make all laws necessary and proper to carry into e fleet the powers delegat- 
 ed, and that such laws shall be the supreme law of the land. 
 
 The constitution, it is true, does not, in terms, give the power to incorpo- 
 rate a bank; that instrument details only the objects of the Government, and 
 delegates certain general authorities to effectuate the ends for which it was 
 formed. In every case it is silent as to the particular means to be employed, 
 or the mode to be observed in the attainment of the object or end. Instead of 
 attempting to specify, in any case, the means of executing a power, it is silent 
 in that particular in every case, granting to Congress the general power I 
 have just stated, to make all laws necessary and proper to carry into effect the 
 delegated powers. Among the general powers expressly granted, is this: "To 
 lay and collect taxes, to borrow money, to pay the debts, and provide for the 
 general welfare of the Union/' What wisdom first suggested, the experience 
 of twenty years has confirmed, that a bank is not only a fit, but the most use- 
 ful means of collecting the revenue of the United States. It has been found 
 the readiest and most certain resource from which to obtain, and on which to 
 rely for loans to Government; and, through its aid, moneys for the public ne- 
 cessities have been safely, speedily, and without charge, placed at the com- 
 mand of Government in every part of the Union. The agency of this institu- 
 tion, thus continually employed, places its utility and expediency beyond 
 question. I consider it, therefore, as " proper/' because it is well adapted to 
 its object; as " necessary," because, if not the only, it is certainly the best 
 means that can be devised to obtain its ends. And, being both " necessary 
 and proper" to carry into effect the power expressly granted to Congress, ki to 
 collect taxes, to borrow money, and pay the debts," it must be constitutional. 
 But, sir, the gentleman from New York says, the United States are not 
 sovereign, and cannot exercise a right of sovereignty, because they depend 
 
288 BANK OF THE UNITED STATES. 
 
 on the will of the States for existence: for, said he, should the States ne- 
 glect or refuse to elect Senators, or to make the laws necessary for electing 
 representatives, the Federal Government would die of its own imbecility. 
 This may be true; the Government may cease to exist; yet, while it does ex- 
 ist, there are powers which it alone can exercise without the control or inter- 
 ference of any other authority. To these purposes, assuredly, then, it must 
 be supreme, or sovereign. For example: the Federal Government has power 
 to lay and collect taxes, and to regulate commerce. Is there any power in 
 this country (I speak of moral not physical power) which can prevent them 
 laying such taxes, and making such regulations of commerce, as they think 
 (it? The constitution of the United States is the act of " We, the People of 
 the United States;" so are the State constitutions; both are derived from the 
 same source; each is independent of the other, and only dependent on the 
 sovereign will of the People, constitutionally expressed. The States have 
 certain powers exclusively confided to them; they may prescribe the de- 
 scents of estates, and regulate distribution of property and other objects of 
 internal police; they are sovereign as to these objects; the Federal Govern- 
 ment is as much so, as to the objects within the sphere of its jurisdiction. 
 Yet, Mr. Speaker, obvious, indeed indispensable, as is the inference and de- 
 duction of the right to incorporate a bank for the management of the financial 
 concerns of the United States, from these premises, gentlemen say it is only 
 an implied power; that no power can be used unless expressly granted in the 
 constitution; and the exercise of implied powers is deprecated as unknown to 
 the constitution, and abhorrent to republicanism, and dangerous to our liber- 
 ties. Let me ask gentlemen, arid I pray they will inform me, whether they 
 do not daily act upon implied powers? If not, let them speak, in what part of 
 the constitution do they find power to build light houses? Where is the power 
 which their President, doubtless with the feelings of a man, and the firmness 
 of a magistrate, so freely exercises, of removing, at pleasure, from office, men 
 who were appointed with the consent of the Senate? You have committees 
 now sitting, who, under your authority, but without law, compel citizens to 
 attend at their summons, without consulting their will or convenience; you 
 have conferred on certain individuals, the sole privilege of trading with the 
 Indian tribes. By what authority are all these, and many other acts, which 
 have been mentioned in this debate, exercised? If I am answered at all, 
 truth will dictate this reply: the power to do these acts is no where expressly 
 granted in the constitution; the authority results from the powers grantecl, 
 and are necessarily implied as the fit and necessary means of executing the 
 powers which are expressly granted. Yes, sir, whether I am answered or not, 
 the fact is manifest, that the implied powers of the Government are not only 
 fairly deducible from the spirit and letter of the constitution, but are essential 
 to the most familiar operations of Congress. And, sir, it is in proof, that 
 gentlemen are in the daily habit of exercising, without scruple or reserve, 
 those implied powers, which, when urged in support of the bank, they turn 
 from with affected abhorrence, as if a single glance, like a look at Medusa's 
 head, would turn them into stone! They have repeatedly acted under them, 
 still grasp them with the love of power and the ardor of ambition, and will 
 only quit their hold to that force which shall deprive them of the reins of em- 
 pire. 
 
 The gentleman from Virginia deprecates a bank which shall be connected 
 with the Government; he calls this a dangerous union of the sword and the. 
 purse; reminds us of the abuse, by the British Government, of the Bank of 
 England in obtaining loans, and of the public debt of that kingdom. None 
 of those objections apply to the Bank of the United States. The charter of 
 the present bank places the institution beyond the control of the Government. 
 It is bound to accommodate the Government with loans to a limited amount, 
 when required; but this obligation on the bank, although its performance may, 
 at times, chance to be unfavorable to the institution, is yet connected with no 
 danger to the country, since the one cannot lend, until we, the Representatives 
 of the People, have authorized the other to borrow. The Executive of the 
 
ON THE BILL TO RENEW THE CHARTER OP 1791. 289 
 
 United States is said to bear the sword, but, sir, Congress holds the purse, 
 and it has not been explained to us how the existence of a bank is to render 
 one subservient to the other, or to convey the sword and purse into the same 
 hand. I can, however, conceive a plan of a bank which would sharpen the 
 sword of the Executive, and give a power to his arm that might be used to the 
 ruin or degradation of our citizens. Adopt the plan which has been recom- 
 mended, and which is to rise upon the ruins of the present institution; erect 
 one great bank, who&e branches snail embrace all the States, and whose capital 
 shall swallow all the State banks; give to the administration the enormous pa- 
 tronage of the appointment of directors to this institution, and place the credit 
 and business of every man connected, of necessity, with banks, at the mercy 
 or pleasure of an Executive, or his minions; the commercial and the enter- 
 prising must decide either to become flatterers and be favored, or to retain 
 their independence and be ruined. It is this system which would give a dan- 
 gerous a detestable power. Your administration, styling themselves repub- 
 lican, have professed to desire no patronage: I will take them at their word. 
 My vote shall never increase their patronage, to multiply their dependents. 
 The crown which they profess to put away, 1 will not force upon their brow. 
 
 As to the Bank of England and the British debt, I perceive not the bearing 
 their connexion can have on the question before us. That the British Go- 
 vernment have made too free use of the ability of the bank to lend, cannot 
 expose us to like mischiefs, because our bank cannot lend, nor our administra- 
 tion borrow, but by the express authority of Congress. Of the British debt, 
 I know its amount is enormous. Yet, sir, how, and for what purpose, has that 
 debt been thus swollen? Perhaps the People of Great Britain owe to that debt 
 the preservation and enjoyment of rights dearer to freemen than their purse. 
 It is, sir, at the cost of that debt that Great Britain maintains her existence 
 and independence as a nation. She might have submitted without an effort, 
 without expense; and, free from debt, have sunk under the chains which the 
 tyrant of France, the enemy of the human race, has fastened upon all the 
 kingdoms of continental Europe. Rather than see my country bow in sub- 
 jection to that direst of despotisms against which Great Britain has struggled, 
 I would, in the spirit of an American, cheerfully bear my share of a debt as 
 large as that which has been the subject of remark. 
 
 The gentleman tells us. that we have sufficient banking capital without that 
 of the Bank of the United States; that the capital of the State banks are equal 
 to the wants of the United States; and that, if this institution is continued, 
 there will be danger of an excess of paper and the consequent mischiefs to 
 the country. Sir, gentlemen need not feel alarm on this point: there is no 
 more danger of a surplus capital being employed in banks, than of such sur- 
 plus being employed in any other business the thing regulates itself. Bank 
 notes may be emitted beyond the uses of the country, but you can no more 
 force them into circulation beyond this necessity, tnan you can force pur- 
 chases and sales of tobacco ana flour beyond the consumption of a country. 
 The commerce of every country requires a certain sum of circulating medium; 
 the amount must be ascertained by experience, which alone can show how 
 much it will absorb and employ. "If you emit paper beyond this amount, it 
 will of necessity return upon the banks. This discovery is not modern; it is 
 as old as the science of banking; and of the errors of a bank no one is more 
 unfavorable to them than the issues of paper beyond the necessity of the 
 country: for, so long as they keep within proper limits, it is found tnat they 
 may emit one and two-thirds or two dollars of paper for each dollar of specie 
 in their vaults; but when their issues of paper exceed these limits, the excess 
 continually returns, and instead of one dollar in specie meeting two of paper, 
 a dollar in specie is required to redeem each dollar of the surplus emission 
 of notes. With this restraint upon their issues, banks are kept m due check; 
 and, sir, when the prudent and safe issues* viz. to the amount required by 
 the country, do not yield employment for the capital, the business ceases to 
 be profitable, the capital is directed to other objects, and the banking fund is 
 kept at its just level. This, sir, is the necessary and just result of fair bank- 
 
290 BANK OF THE UNITED STATES. 
 
 mean not their nominal but their specie capital) of their debts, and their 
 resources, we are, and must remain, entirely ignorant; and we have seen that, 
 some of these institutions dishonestly emitting paper beyond the sum authorized 
 by their capital, and beyond the necessities of the country, their notes have 
 returned upon them, they have been unprepared to pay, their paper has de- 
 preciated, and individuals have been defrauded to a vast amount And such 
 again may be the case, if we remove the check, the restraining influence, 
 which the large and solid capital of the Bank of the United States, and its 
 prudent direction, has enabled it to exercise over the State banks these 
 " mushrooms," as the gentleman has called them, which, like Jonah's gourd, 
 have sprung up in one night and withered in the next. 
 
 The gentleman informs us that our exports of domestic products amount 
 only to forty-five millions of dollars; that the capital of the different banks 
 in the United States, at the rate of issues of the United States' Bank, may 
 emit ninety millions of dollars; and he infers that a paper medium beyond 
 the amount of domestic exports cannot be necessary. This opinion, sir, 
 needs an elucidation which the gentleman did not give it. Why the amount 
 of produce purchased for exportation should form the measure of circulating 
 medium, is, to say the least, not self evident. Nor can I conceive why, in 
 calculating the medium necessary or useful for the concerns of the country, 
 we should exclude from view the purchases for internal use as well as for 
 external sale, or lose sight of the repeated use made of the same note or piece 
 of metal, in its continued circulation. The circulating medium of a country, 
 whether paper or specie, represents^ because it commands, the articles we 
 need and get in exchange for it. What the sum should be, my political 
 arithmetic does not teach me, nor does the rule of the gentleman from Vir- 
 ginia. In my opinion, experience alone can shew it, as I have before said, 
 viz. that amount which the commercial, agricultural, and manufacturing con- 
 cerns of the country will require and can employ, to be ascertained from the 
 amount of silver and gold in circulation, bank credit, and bank notes issued, and 
 not returning upon the banks. It is, I admit, a fact, a proud fact, that the ex- 
 ports of our country have increased from eighteen to forty-live millions. New 
 fields have been opened, produce increased, means of conveyance multiplied, 
 and new markets sought and resorted to. Agriculture, commerce, and ma- 
 nufactures, have advanced, as they necessarily must, hand in hand ; and to the 
 beneficial influence of banks, increasing the capital, encouraging enterprise, 
 stimulating arid rewarding the industry of the country, are indebted for much 
 of this increase. 
 
 The testimony which the gentleman has borne to the correct management 
 of the Bank of the United States, was to have been expected from his infor- 
 mation and liberality. The fact previously stated and repeated by him, as u 
 defect in arrangement, that the notes of the bank, and its branches, are not 
 paid but at the office from which they issue, and at which they are made paya- 
 ble, is not ground of complaint. The bank and its branches have each but a 
 portion of the capital. Of the branches, the largest portion (at New York) 
 only $1,800,000; and it is absurd to expect that either the branch with this 
 capital, or the others, with less, should redeem at all times the notes emitted 
 upon a capital of ten millions: the thing is impossible. 
 
 From the opinion advanced by the gentleman, that the state of the bank 
 should rather excite the fears of the institution for its own safety or solvency, 
 than awaken the apprehensions of the community for the effects of its disso- 
 lution upon them, 1 beg leave to dissent. We have had in debate various 
 statements of the affairs of the bank, drawn either from former reports or 
 conjecture. The report of the Secretary of the Treasury, this day laid on 
 our tables, shows the present state of the bank; to this I shall refer for 
 facts. 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 291 
 
 There is due to the bank from individuals, upon notes dis- 
 counted, - $14,578,294 25 
 Other banks owe them for notes and in account, - - 1,287,485 92 
 The Government owe, including the late loan, funded debt, 
 
 and treasury drafts, - - 2,807,046 49 
 
 18,672,826 66 
 
 They have, in gold and silver. - - 5,009,567 10 
 
 And in real estate, - 500,652 77 
 
 Making a property to face the demands on them of - $24,183,046 53 
 
 On the other hand, what do they owe? 
 
 To the holders of their notes in circulation, - $5,037, 25 23 
 
 To the Government, for deposites, - - 1,929,99960 
 
 To other banks, due in account, 634,348 01 
 
 To individuals, for deposites, - - 5,900,422 83 
 
 _J_I__ 8,464,770 44 
 
 To balances on outstanding drafts, 171,473 17 
 
 Making the total amount of their debts, - $13,673,368 83 
 
 Thus, sir, with a property of twenty -four millions of dollars, they owe less 
 than fourteen millions, leaving the stockholders the original stock of ten mil- 
 lions and a surplus of more than hull" a million to meet bad debts. But, were 
 it otherwise were it possible, that, of the debts due them, ten millions 
 should never be collected, the hiss would affect (he stockholders, whose origi- 
 nal advance would be lost, but the interest of the community would not even 
 then be affected; at least, not as creditors of the institution; because, even it 
 ten millions, the capital stock, were by any means sunk, the bank would still 
 be solvent; it would even then pay its debts, and, consequently, must be per- 
 fectly safe as regards the community. 
 
 Such, sir, is tne state of the account on the side of the bank. 
 
 How stands the account with the debtors of the bank, or rather with the 
 public? 
 
 The bank can demand the debts due it, - $18,672,826 66 
 
 Admit the demands upon it are applied as sets off to their 
 
 full amount, - - 13,673,368 83 
 
 The balance still to be raised by the country is $4,999,457 83 
 
 within a trifle of five millions of dollars. 
 
 Whence is this sum to comer Not from the vaults ot the other banks; they 
 tip not possess it. It is stated, in the able speech of the representative of the 
 city of Philadelphia, in the Legislature of Pennsylvania, upon the resolution 
 respecting the bank, that the report of the state of all the banks of that State, 
 recently made to the Legislature, shows that all the banks in Philadelphia, 
 (excepting that of the United States) have, together^ but a little more than one 
 million of dollars in specie: those who have the best means of information, 
 declare the specie in the banks of New York is not greater, and in those of 
 other cities unquestionably less. The State banks then have not the money, 
 and cannot produce it. Will the notes of these banks pay the debt? No, 
 sir, because their notes will be returned upon them for payments which they 
 cannot make. These banks know their own strength or weakness, and, that 
 they dread this crisis, is manifest from the course they have already adopted; 
 they have curtailed discounts, and commenced calling in their debts. The 
 consequences you learn from the moans of your correspondents, and from the 
 petitions which daily press your table; the want of money has produced a 
 want of punctuality; confidence is destroyed; the life, the animating spark of 
 business is, at it were, suspended, and deep distress is fast spreading over the 
 commercial world. Sir, my deductions are supported by facts. They prove 
 
292 BANK OF THE UNITED STATES. 
 
 the solvency, indeed the strength, of the Bank of the United States is such 
 as to merit the confidence of the People, which it enjoys, while the situation 
 of the State banks, and the deficiency of the precious metals, gives a fatal as- 
 surance of the inability of the country to submit without great distress to the 
 operation of having extracted from it the large debt due the bank, 
 
 The gentleman from Virginia say s it is no argument in favor of a continuance 
 of the bank that it is necessary for the management of the financial concerns 
 of the United States; for that the word b * finance" is not to be iound in the 
 constitution. Sir, were I called upon by one of the yeomanry of this coun- 
 try: one whose days had been spent at the plough, remote from courts, and 
 without concern in affairs of state, to define to him what were the financial 
 concerns of the United States, I should, as an explanation adapted to the 
 simplest understanding, inform him, that the laying ami collecting taxes, bor- 
 rowing money, and paying the debts of the Union, were its financial concerns. 
 And, as these powers are expressly granted to Congress, although the word 
 44 finances" may not be found in the constitution, Congress are thus required 
 of necessity to provide for the management of the "financial concerns" of the 
 United States. 
 
 Permit me now, sir, to notice objections urged against the bank from other 
 quarters, and of a different nature objections not calculated, probably not in- 
 tended, to influence this House, but which may have arr influence abroad- 
 Gentlemen have objected to what they term the foreign influence in our af- 
 fairs, from the portion of this bank held by foreigners; and the gentleman from 
 Maryland [Mr. WRIGHT] has alledged that aliens, traitors, and old tories* 
 are entrusted with its direction; others, with him, have said that the bank and 
 the funding system are twins of the same progenitor, Alexander Hamilton, 
 and that the question of creating this bank was the ground on which the par- 
 ties of the United States first divided, 
 
 The charter of the bank did not exclude foreigners from purchasing shares; 
 
 .^because, a t the period of its establishment, our country was without capital , 
 
 and it was an object rather to invite foreign capital to the United States, than to 
 
 repel it; their large funds and low rates of interest have enabled them to give 
 
 more in the market than our citizens could afford to pay, and they have conse- 
 
 1801, all the stock in the bank which the United States owned. 
 
 This charter denies to any stockholder, not a resident, of the United States, 
 the right either of a vote in the choice of directors, or a seat at the board of 
 directors. And, thus divested of any power to interfere in the concerns of 
 the bank, it requires more than human penetration to discover, or more than 
 ordinary jealousy to suspect,. how foreigners can influence even the affairs of 
 the bank, much less, through its agency, the concerns of the country* 
 
 This cry of foreign influence from the use of foreign capital is a modern 
 bugbeaiv During our Revolutionary struggle, our soldiers were clothed and 
 armed with funds borrowed in Europe: our nerves were hardened, our sinews 
 stiffened, and our independence achieved, with the assistance offoreign capital. 
 Yet the heroes and sages of that day suspected not any improper foreign in- 
 fluence; they were brave and wise, but. not as cunning as our present statesmen 
 who have made the discovery. 
 
 As to the aliens^ traitors, and old lories* who are concerned in the direction 
 of the bank, the gentleman is too general in his charge. So far as he will be 
 particular, he can be met. Ho named but two persons as meriting his de- 
 nunciation Evan Jones and Daniel Clark, both of New Orleans. I, sir, 
 know not personally either of these gentlemen. Mr. Jones I understand to 
 be a native of Pennsylvania, who, at the peace of 1763, when Great Britain 
 acquired Florida, settled in that country, and has resided there and at New 
 Orleans ever since; he is declared to be a man of high character for integrity 
 and honor. Mr. Clark has had a seat as a delegate on this floor; though not a 
 native of tho United States,- he is as much a citizen as any of the inhabitant* 
 
ON THE BILL TO REI^VV THE CHARTER OF 1791. 295 
 
 of Louisiana, made so by treaty, and as much so as will be the representa- 
 tives of the State of Orleans " that is to be," in the next Congress. Against 
 his character nothing has been alleged, other than that imputation which the 
 People of the United States have fixed upon the character of every man who 
 has been the friend or associate of Wilkinson and Burr. Let me not be un- 
 derstood as committing myself to the opinion of the guilt of these gentlemen. 
 I was not of Burr's jury lie may be guilty; nor am I of Wilkinson's com- 
 mitteehe may be innocent: yet suspicion deeply stains his character; it will 
 take much labor of the file to rub it off. 
 
 But, sir, let it be supposed that an individual vvho was unfriendly to our 
 Revolution should have been chosen by those who are proprietors of the bank 
 to a seat iu its direction. Would the choice be either new or criminal? Sir, a 
 person whose name is recorded in the proscription statute of a State, as an 
 fct old tory," was appointed, by Mr. Jefferson, a district judge of the United 
 States. In other States, but particularly in New York ami Pennsylvania, 
 persons who bore arms against us, and adhered to our enemy in the Revolu- 
 tionary war, have also been appointed, by a republican President, to offices of 
 high trust. Why were these "qW tories" thus honored and trusted? Because 
 they possessed integrity and abilitj; to qualify them for their stations. And. 
 why might not a tory be chosen a director of a bank, if his virtues and talents 
 had gained him the confidence of the stockholders? The choice seems to me to 
 be as pardonable in a stockholder as in a President; or, is it. sir, that the re- 
 publican President has been converted into a political Pope, and has, alone, 
 the power to pardon and absolve from political sins? 
 
 Of the origin of the Bank of the United States, the honor is certainly due to 
 the first Secretary of the Treasury. In justice to his memory, the fact ought 
 frequently to be mentioned, and never to be forgotten. But, sir, the merit of 
 obtaining the adoption of the plan is not entirely his. The original bill, in 
 every stage, received the support of gentlemen of the republican partyj 
 among those who were its earliest supporters, one most distinguished for abili- 
 ty, the present Secretary of the Treasury, continues its advocate to the present 
 hour. 
 
 In support of the claim of the bank for a renewal of its charter, and to the 
 credit of Mr. Gallatin. I will here read extracts from his report to the Senate, 
 March, 1809. 
 
 kt The advantages derived bj* Government from the bank, are nearly ol the 
 same nature with those obtained by individuals who transact business with 
 similar institutions, and may be reduced to the following heads: 
 
 1. * 4 Safe keeping of public moneys. This applies not only to money in the 
 Treasury, but that in the hands ot collectors, and alVordsone of the best secu- 
 rities against delinquencies. 
 
 2. " Transmission of public moneys, from one quarter of the Union to ano- 
 ther. This is done by the bank, at its own risk and expense. 
 
 3. " Collection oft/ie revenue. The punctuality of payments introduced by 
 the banking system, and the facilities offered by the bank, to importers indebt- 
 ed for revenue bonds, are amongst the causes which have enabled the United 
 States to collect, with so great facility and with so few losses, the large reve- 
 nue derived from impost. 
 
 4. '* Loans. The bank has been eminently useful in making the advances, 
 which, under different circumstances, were necessary. At one time, Govern- 
 ment owed it $6,200,000, exclusively of six per cent, stock, original subscrip- 
 tion; and a similar disposition to accommodate has been repeatedly evinced, 
 whenever the aspect of public affairs has rendered it proper to ascertain 
 whether new loans might, if wanted, be obtained." 
 
 The report then states, that, although the banks established under the autho- 
 rity of the States, might afford considerable assistance to the Government in 
 its fiscal operations, there is none which can transmit moneys with the same 
 facility or to the same extent; none which can afford so great security against 
 any possible losses, or greater resources in relation to loans. " Nor is it eligi- 
 ble tnat the General Government should, in respect to its own operations, oe 
 
294 BANK OF THE UNITED STATES. 
 
 entirely dependent on institutions over which it has no control whatever." He 
 also notices the objection of foreigners holding stock; but this, he declares, 
 "does not, at all events, appear sufficient to outweigh the manifest public ad- 
 vantages derived from a renewal of the charter. " 
 
 Mr. Speaker, gentlemen may disregard, but they cannot despise, nor can 
 they destroy, this high testimony, which, while it establishes the utility of the 
 bank, bears honorable testimony to the upright and patriotic spirit in which 
 its operations have been conducted. This testimonial outweighs all that the 
 bickerings of interest, the suggestions of jealousy, or the apprehensions of the 
 uninformed can assert against the institution. For myself, sir, had I no other 
 knowledge of the subject, I should feel no hesitation, upon the question of con- 
 stitutionality and necessity of a bank, which Hamilton recommended, Wash- 
 ington approved, and Gal latin, after twenty years' experience, continues to 
 advocate. The shade which has been attempted to be cast upon the fame of 
 Hamilton, as the " progenitor of the bank," must, when examined, like every 
 other attack upon it, but add to its lustre. Sir, I shall not attempt to eulogise the 
 name of that great man; were my feeble powers equal to the task, I should 
 deem it unnecessary. Party rancor, which impotently followed him to the 
 grave, cannot now obscure one ray of that sun of glory which shines upon the 
 tomb of the illustrious dead. 
 
 As if satisfied, or fearful, that no argument against the bill could be urged 
 which would plausibly destroy its claims to support, the question has been 
 called a party question. To rally a party round its standard, to excite the 
 pertinacity and awaken the severity of party feeling, it has been declared, 
 that, upon the question of incorporating mis bank, in 1791, originated the di- 
 vision of parties, which have since existed in this nation. Until this time, sir, 
 this discovery has not been made. I had understood a very different history 
 of the origin of party. 1 have heard, I have read for my youth did not permit 
 me to ^yitness that, at the formation of our present constitution, many persons, 
 with different vievys, were opposed to its formation and adoption, preferring 
 that 'shadow of Union, in which the States, as with a rope of sand, were at- 
 tempted to be bound under the confederation, to the strength, firmness, and 
 unity, in which we are knit by the Federal Constitution. The good sense and 
 good fortune of our country prevailed; the constitution was adopted, and those 
 who, as anti-federalists, had opposed the adoption of the constitution, were 
 organized, with very tew exceptions, under the name of republicans, in oppo- 
 sition and decided uniform hostility to the measures of the Federal Govern- 
 ment. 
 
 The charter to the bank, thus, indeed, became, with some of its opponents, 
 a question of party, although it received the support of others who were anti- 
 feueral. In this party opposition, it only met the fate of every other measure, 
 however wise and salutary, originated and perfected at that period. 
 
 Let us hope, sir, that the blindness and injustice of such rule of action, is 
 not again to be revived. 
 
 Let me now, sir, rapidly glance at the consequences which are to attend 
 the rejection of this bill. The intercourse between the States, and the deal- 
 ings of the citizens of a State with those of different parts of the same State, 
 require a circulating medium, far above the quantity of gold and silver which 
 exists among us. No man contends that the demands of commerce, or even 
 the ordinary transactions of individuals, can, in the present scarcity of gold 
 and silver, he carried on without the intervention of bank notes. Hitherto, 
 sir, the notes issued in each State have answered some of the domestic uses; 
 but, for the purpose of remitting to, or receiving payment from, other States, 
 no reliance has ever been placed upon the notes of State banks. It has fre- 
 quently happened, that notes have got into circulation, purporting to be issued 
 by a bank which, in fact, never existed; and others, issued by banks which 
 had failed. The difficulty of knowing the real from the spurious, and the sol- 
 vent from the insolvent, has so far restrained the circulation of the notes of 
 State banks within the limits of their own State, as to have prevented any late 
 frauds and losses, except among the very uninformed part of the community. In 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 295 
 
 these circumstanceSy the known ability of the Bank of the United States, the 
 receipt of its paper in payment of debts to the United States, has given it a 
 currency and credit equal to gold and silver, in every purpose of domestic or 
 f9reign use; and its frequency among us has so far familiarized all men of bu- 
 siness with the notes, as, if not entirely to prevent frauds from counterfeits, at 
 least, greatly to diminish the injury. In destroying this bank, you are about, 
 sir, to strike all this most valued paper medium out of existence; to dissolve 
 an artificial capital of the Bank of the United States, of ten millions of dollars; 
 and not merely this capital of the Bank of the United States, but, by with- 
 drawing from the other banks the very large portion, if not the whole of their 
 specie capital, with which they must part, to pay the Bank of the United 
 States the debts daily increasing against them, by the receipt of their notes in 
 discharge of individual debts to the Bank of the United States, you inevitably 
 render the State banks less able to accommodate, and diminish, greatly, that 
 portion of the circulating medium emitted by these banks. 
 
 Of the distress which this measure will occasion, I need say nothing; the 
 evidence of its existence and magnitude surround you, and have been already 
 repeatedly pressed upon your attention. You are, in fact, todestroy all con- 
 fidence in bank paper. Can my constituents know whether the bank note of 
 New Hampshire or Georgia, which is offered them, is genuine or spurious? 
 Can they know whether a bank is in credit or insolvent, of which they have 
 never before heard? Yet, sir. as gold and silver is not to be had, and the Unit- 
 ed States' Bank notes will no longer exist, you reduce the People to this di- 
 lemma: either they must receive the notes of State banks, ignorant, as they 
 must be, of their genuineness or credit, encounter the daily risk of being de- 
 frauded, or keep on hand their produce. In this state of uncertainty, bank 
 - must lose their credit; will rea.sii to circulate; must soon depreciate; and 
 a scene of speculation and embarrassment will ensue, not unlike those which 
 have heretofore nearly ruined our country. 
 
 Mr. Speaker, the present is not a time for dangerous experiments upon the 
 prosperity of our country. With foreign nations, our relations are more, than 
 at any other period, perplexed. In my apprehension, the nations of Europe, 
 with more than one of whom we have advanced in a warlike attitude, will 
 have more forbearance and less temper than is usual with them, if they do not 
 meet us with decided, not secret hostility. And in this time of danger from 
 abroad, while, with a non-intercourse law in one hand, you fetter all external 
 commerce, sink your revenue, and reduce the value of property; with the 
 other, destroying the bank, deranging the finances of the Government, over- 
 turning private credit, destroying commercial confidence, you press, with the 
 deadly weight of an incubus,*upon the exertions of domestic industry and en- 
 terprise. The inevitable effect of these measures must be, to turn lose a tor- 
 rent of overwhelming calamity, the extent of which you cannot estimate, anil 
 the force of which you cannot stay. The consequences are awful; the respon- 
 sibility serious. Let gentlemen look to it. 
 
 Mr. M'KEE. Mr. Speaker: Having once troubled the House on this sub- 
 ject, it is not without much regret that task the attention of gentlemen to a 
 few more remarks, before the question is taken 
 
 The opposers of this bill have uniformly contended against the exercise of a 
 power under the constitution, which is not expressly delegated to Congress by 
 the letter of the constitution. This position cannot be maintained by the ex- 
 perience of what is past; nor can it be adhered to in future, in the management 
 of the affairs of this Government. And I conjure gentlemen to pause, before 
 they give a construction to the constitution which they themselves have, on 
 other occasions, [violated $ and which they will be compelled again to violate, 
 or desert the best and clearest interests of their country. 
 
 Sir, the territory of Louisiana has been purchased since the commence- 
 ment of the republican administration; and this act constitutes one of their 
 strongest titles to the fair fame with vvhich they are surrounded. And yet I 
 ask, where (according to the construction contended for) is the power, under 
 
296 BANK OF THE UNITED STATES. 
 
 the constitution, which could authorize the mode of this acquisition? Will any 
 gentleman point it out to me? For I confess I cannot perceive it. 1 know 
 Congress are expressly empowered by the constitution to declare war; and 
 the power to declare war includes the power to acquire territory by the suc- 
 cessful result of that war. And hence it would seem to follow that the Go- 
 vernment may, with propriety, attain the same end by treaty or purchase, 
 which they could effect by force. But this power is certainly a constructive 
 one, to be collected from the reason and not the letter of the constitution. And 
 therefore, according to the doctrine inculcated, it cannot be used. 
 
 Congress have also laid a general embargo; and whence, I ask, is the pow- 
 er authorizing this act, derived? It certainly cannot be justified under the 
 general power, delegated by the constitution* to Congress, to regulate com- 
 merce: because a general embargo, during its continuance, puts an end to all 
 commerce. And it is perfectly absurd to say that a general delegation of 
 power to regulate commerce includes the power to suspend it altogether. But 
 the constitution has delegated to Congress the power to provide for the gen- 
 eral welfare and common* defence; and a withdrawal of the property as well 
 as the persons of our citizens from the ocean, in times of difficulty and danger, 
 by means of a general embargo, thereby reserving to the country the resources 
 as well as physical force of the People, unimpaired, is, in fact, providing for the 
 general welfare and common defence. And hence results the power exercis- 
 ed by Congress of laying an embargo. But, sir, this is also a constructive 
 power, not expressly delegated to Congress by the constitution; and therefore, 
 by the doctrine contended for by the opposersof this bill, cannot be exercised. 
 
 Congress have built a house for the President of the United States, that 
 would, in point of size and magnificence, beggar any thing to be found at St. 
 James's or elsewhere. They have established post offices in all the States of 
 the Union, and by law exempted the post masters from serving on juries as well 
 as performing military du'y: by this mean creating an influence in the interior 
 of the States, without any express delegation ot power authorizing the act j 
 and therefore (according to the construction contended for on this occasion) 
 unauthorized and unconstitutional. 
 
 I might proceed to enumerate a long catalogue of cases, in which Congress 
 have exercised powers under the constitution which were not expressly dele- 
 gated, but drawn entirely from the reason, spirit, and essence of the instrument; 
 and justified alone, in their fitness and efficacy to carry into effect some of the 
 great class of powers delegated to Congress by the constitution. The People of 
 the United States have experienced the most happy consequences, arising 
 solely from the exercise of those constructive powers, against which some 
 gentlemen now declaim with so much apparent zeal; and which are certainly 
 less tortured and far-fetched, than the construction for which those gentlemen 
 so pertinaciously contend. 
 
 When we view the past, we find that all parties have uniformly given the 
 same practical construction to the constitution. 
 
 Washington, the great father of his country, Mr. Jefferson, Mr. Gallatin, 
 and all the magistracy of the United States, including both Houses of Congress, 
 have given, directly or indirectly, the same contraction to the constitution; 
 and with these illustrious examples and precedents before me, I cannot arro- 
 gate to myself the self-sufficiency to disregard or distrust them, and make out 
 some new Utopian untried theory, sanctioned neither by reason, experience, 
 nor policy; believing it to be more safe to pursue the old and beaten track, 
 than to adopt untried expedients; particularly in a case of a doubtful nature. 
 I admit that Congress ought not to look for the constitution in your statute 
 book, or in the fugitive pages of your journal, but to the instrument itself. 
 But, sir, where a construction has been given to this instrument by its great 
 father, and where that construction has been ratified by the sovereign voice 
 of the People, it should remain unchanged. 
 
 ,.^The gentleman from Pennsylvania, (Mr. SMILIE) has endeavored to assi- 
 milate the power now attempted to be exercised to that exercised in the adop- 
 tionofthe odious alien and sedition laws, (as they have generally been called.) 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 And if, sir, the gentleman had forgotten (as he seems to have done) the first 
 article in the amendments to the constitution of the United States, then, indeed, 
 his parable would have been an appropriate one, differing from the construction 
 now contended for only in the signal circumstance, that the alien and sedi- 
 tion laws, in their practical operation, tended to abridge the liberty of the citi- 
 zen, whilst the bank is a matter of policy alone. 
 
 But these alien and sedition laws were in direct hostility to the first article in 
 the amendment to the constitution, which is in the following words: "Con- 
 gress shall make no law respecting the establishment of religion, or prohibiting 
 the free exercise thereof, or abridging the freedom of speech or of the press." 
 This prohibitory article shows the real difference between the two cases. 
 
 Much sensibility has been manifested in relation to State rights, which, it is 
 apprehended, will be prostrated by the resuscitation of this charter. Sir, I am 
 a friend to State rights; in the safe and inviolable preservation of which we 
 have the surest guarantee for the perpetuity of this Government. But, sir, 
 I ask if there are not extremes on this subject? And whilst we are guarding 
 against Scylla, with care and solicitude, is there no danger of falling on C/ia- 
 rybdis? Are not the power and influence of some of the States now almost 
 paramount to the power and influence of the General Government? By your 
 refusal to renew the charter of the United States' Bank, you considerably en- 
 hance this power in the hands of the great States. Your revenue is then to be 
 collected and deposited in State banks. About one-third of it will be collect- 
 ed by the State of Pennsylvania, and will be deposited in her banks. And 
 those banks are, as they relate to you, entirely foreign banks. You have no 
 control whatsoever over them or any of them. But the State of Pennsylvania 
 has a control over them; and consequently, Pennsylvania (if you destroy the 
 charter) has in her fangs the purse of the nation! which, as the gentleman 
 from Virginia, (Mr. EPPES) says, constitutes the sinews of war. Pennsylva- 
 nia possesses within herselt the physical force; a force that would be formida- 
 ble to the whole United States, were it arrayed against them. And is it en- 
 tirely without precedent, for the destinies of ORe State to be wielded by a 
 single individual? If it is not, then the destiniei of Pennsylvania, holding as 
 she will, both the purse and the sword, might be wielded by some ambitious 
 and assuming man. And if such an event should happen, which God forbid! 
 where then .ire your political liberties? Precisely as safe and secure as if they 
 were lodged in the hands of Napoleon the Great! 
 
 "What constitutes the power and influence of a State? Certainly, money and 
 physical force are the principal and most requisite ingredients; and by refusing 
 to renew the charter, you throw into the hands of the great States, all the addi- 
 tional influence, arising from the resources of the nation being confided to 
 their hands. And at the same time, you reduce to the condition of mere 
 cyphers the^ States of North Carolina, Tennessee, Ohio, Kentucky, and all 
 the New England States, except Massachusetts, by withdrawing entirely 
 from their control and management, the public purse of the nation. 
 
 I do not wish, Mr. Speaker, to be understood to entertain or insinuate any 
 distrust whatsoever of the integrity or loyalty of the great and respectable 
 State of Pennsylvania. 
 
 If, sir, the destinies of this nation are to become dependent on any one State 
 in the Union, I have no predilection for any State: I have no unwillingness 
 that Pennsylvania should be that State. But, sir, I protest, solemnly, against 
 holding, by so feeble and precarious a tenure, the great and inestimable privi- 
 leges of self government. 
 
 But, it is said we may console ourselves with the improbability of the great 
 States making any improper use of the powers vested in their hands, by a re- 
 fusal to renew this charter. Sir, when at peace with foreign nations: vVhilst 
 harmony prevails at home, no immediate danger is to be apprehended; but 
 when your political horizon is black with internal tumult, wnen you are me- 
 naced with external danger, and treason stalks abroad with gigantic strides, 
 it is then that the colossal power of the great States becomes most eminently 
 clanger nis: it is then that it may be exercised to the utter humiliation of the 
 38 
 
298 RANK OF THE UNITED STATES. 
 
 little States, and the subversion of your federal government, by withholding 
 from your hands the fiscal resources of the nation. To guard, when it may 
 be practicable, against possible events so disastrous, becomes the imperious 
 duty of every sound and honest politician. 
 
 There is a view of this question, which strikes me with great force, and to 
 mention which was my principal motive in rising at this time. It has been 
 repeatedly stated by the opposers of this bill, that the revenue could, with 
 equal facility, be collected, through the agency of the State banks. Is it, 
 then, their object todeposite the public money in State banks? I pause for a 
 reply. The silence which pervades this hall, solemnly answers this question 
 in the affirmative. It is, then, intended to deposite the revenue and resource:* 
 of the United States of Jjmerica^ in the coffers of State banks! I say this is 
 dangerous, unjust, and manifestly partial. 
 
 The president, directors, and company, of the United States' Bank, offer you 
 $1,500,000 to renew their charter: and in the bill, now before you, a privi- 
 lege is reserved to the United States, of increasing this stock, by a contribu- 
 tion of $5,000,000 on the part, and for the benefit of the United States. The 
 profit arising from the sale of this stock, if you are disposed to sell it, would 
 be more than $1,000,000. Suppose, then, that the United States' Bank would 
 be willing to give $1,000,000 tor the banking privilege alone, (which seems to 
 me a very large allowance) the remaining one million two hundred and fifty 
 thousand dollars are given to the United States, tor the benefit arising to the 
 bank, from the deposites of the public money. 
 
 This sum will be increased to at least $2,000,000, or perhaps $3,000,000, or 
 $4,000,000, by that part of the bill before you, requiring the Bank of the United 
 .States to pay interest, at the rate of three per centum, on all sums which may 
 remain in the hands of the bank longer than one year. This increased sum, 
 arising out of the use of public money, is as much the bonajidc property of the 
 People of the United States, as any other portion of their revenue. The pro- 
 portion of this sum, to which my constituents (the people of Kentucky) are 
 entitled, is about $1,000,000. And it is now gravely proposed to wrest this 
 sum from their hands, not for the public service, or public good, but for the 
 Express purpose of putting it into the pockets of the wealthy capitalists of 
 Pennsylvania! the State bank stockholders of Massachusetts, Maryland, 
 and Virginia! Will the People cheerfully acquiesce in this unjust prostitu- 
 tion of their honest earnings? If they do, I have mistaken their character. 
 
 When these are some of the consequences which are seen to result from a 
 refusal to renew the charter of the United States' Bank, no man can be much 
 at a loss to account for the instructions given by Virginia, Massachusetts, 
 and Pennsylvania, to their Senators and Representatives in Congress. 
 
 My friend (Mr. JOHNSON) has informed you, that a renewal of this charter 
 would be granting an exclusive privilege to a few stockholders, and exclusive 
 privileges are odious. It my worthy friend would only examine the bill now 
 before you, he would find that it is not an exclusive privilege: for Congress 
 have therein reserved to themselves the power to establish a new bank, when- 
 ever policy or prudence shall dictate its necessity or expediency; and this 
 power, reserved by Congress, of establishing a new bank, will ensure to the 
 United States a prudent and faithful management of the money, which it is 
 proposed to confide to the direction of the president, directors, and company, 
 of the United States' Bank; which it is acknowleged by the gentleman from 
 Virginia, (Mr. EPPES) has hitherto been managed with great propriety. 
 
 The gentleman from Virginia, (Mr. EPPES) stated that this question was 
 originally decided as a party question,, In this the gentleman is certainly 
 mistaken. It was not originally considered a party question. In order to 
 satisfy my own mind on this subject, I have examined the journal of Con 
 gress, for the year 1791; which has been explained to me by the gentleman 
 from North Carolina, (Mr. MACON) the oldest member in this House. And 
 I find there were thirty-nine votes in favor of the bank originally; of which 
 eleven were republican; and of the nineteen who voted against it, six were 
 federal. This fact proves, without doubt, that this question was not decided 
 
ON THE P.ILL TO RENEW THE CHARTER OF 1791. 299 
 
 by parly principles. But why, I ask, are such unceasing efforts made to prove 
 this a party question? Is the gentleman from Virginia, (Mr. EPPES) whose 
 argument on this subject was directed principally to this point, fearful of a 
 diminution of his customary weight in the rcale of discussion, or of the in- 
 sufficiency of his reasoning and argumentative powers, to draw his friends 
 with him on this question? And is he, therefore, compelled to resort to this 
 argument, as a mean of whipping into the track those vyho are disposed to 
 obey the honest convictions of their own judgments? If Mich be his object, 
 I can only say for myself, that I am drawn along with that gentleman by the 
 cords of reason, policy, and common sense, alone. And where these are too 
 weak, [ cannot be seduced from my own opinion, by the fascinating eloquence 
 of any man, or any system of proscription or denunciation, however formidable 
 it may be, either in plan or ojK'raiion. 
 
 It has been fashionable for gentlemen on this floor, wh?n speaking of party, 
 to declare they were not pariy men. But, sir, I acknowledge 1 am a party 
 man. And 1 have no hesitation in declaring, that 1 belong to the People's 
 party. It is lor the promotion of the happiness and prosperity of the People 
 of Kentucky, in particular, and of the whole United States in general, that 
 my services are rendered in this [louse. And if, on this, or any other occasion, 
 the true interests of the People of Kentucky have been misunderstood by me, 
 they will, as I know they can, -elect, from among themselves, some individual, 
 possessing more wisdom to perre'ive, and an inclination to pursue, the means 
 best calculated to promote the interest, happiness, and increasing prosperity 
 of my country. And should they adopt Mich a measure a-; salulai \ or ex- 
 pedient, their decision would receive my most ^inc-iv rr-pert and acquies- 
 cence. 
 
 It is for the protection and promotion of the be>.t in'.ere-fs !,-f my country 
 and of my constituent* that 1 have again presented uiy-ell before this House, 
 to give a last, and perhaps a feeble vieu . of the impolicy and the deleterious 
 consequence* of the act, which I fear is now about to be done. 
 
 Before 1 sit down, permit me to advise my political friends, who vote with 
 me on this occasion, (for I have no right to administer advice to others) to 
 sutler the (lecisive vote now to be taken on this great and much agitated ques- 
 tion. We have given this bill all the support constitutionally within our 
 power; let the majority, if against us, now decide, and take on themselves 
 that awful weight of responsibility which awaits their decision. Ami if the 
 affections of the People should, on account of the frequent appeals made to 
 their passions and prejudices, recede for a moment from us, it cannot but be, 
 to us, a consolatory reflection, that we have discharged, with honesty and fide- 
 lity, our duty to our country. And that, when reason and reflection may 
 have resumed, once more, their empire, we will again be surrounded with the 
 confidence and gratitude of the People. 
 
 JANUARY 26, 1811. 
 
 and ordered to lie on the table. 
 
300 BANK OF THE UNITED STATES. 
 
 IN SENATE. 
 
 HTH CoiroRKSs, ? T - 
 
 adSksrion. 5 DECEMBER 18, 1810. 
 
 Mr. LEIB presented the petition of the Bank of the United States, praying 
 a renewal of their charter, which was referred to a select committee, consist- 
 ing of Messrs. Crawford, Leib, Lloyd, Pope, and Anderson. 
 
 FEBRUARY 5, 1811. 
 
 Mr. CRAWFORD reported a bill to amend, and continue in force, an act, en- 
 titled " An act to incorporate the subscribers to the Bank of the United 
 States," which was read the first time; and also communicated a letter from 
 the chairman of the committee to the Secretary of the Treasury, together 
 with the answer of the Secretary thereto. Mr. Crawford's note to the Secre- 
 tary of the Treasury, and his answer thereto, are as follows: 
 
 SENATE CHAMBER. January 29, 1811. 
 SIR: 
 
 The Committee of the Senate, to whom has been referred the memorial 
 of the President and Directors of the Bank of the United States, praying for 
 a renewal of their charter, have directed me to request you to state to the 
 committee, whether, in your opinion, the renewal of the said charter will not 
 greatly facilitate the collection of the revenue, and promote the public wel- 
 fare. In complying with this request, it is expected that you will furnish the 
 committee with the facts and reasoning upon which your opinion has been 
 formed, together with such other information upon the subject, as may be in 
 your possession. 
 
 I am, sir, respectfully, your obedient and very humble servant, 
 
 WM. H. CRAWFORD. 
 
 The Hon. ALBERT GALLATIX. 
 
 TREASURY DEPARTMENT, January 30, 1811. 
 SIR: 
 
 Having already, in a report to the Senate, of 2d March, 1809, expressed 
 my opinion in favor of a renewal of the charter of the Bank of the United 
 States, an opinion which remains unchanged, I can only add a few explana- 
 tory remarks in answer to the inquiries of the committee, as stated in your 
 letter of yesterday. 
 
 The banking system is now firmly established; and. in its ramifications, 
 extends to every part of the United States. Under that system, the assist- 
 ance of banks appears to me necessary for the punctual collection of the re- 
 venue, and for the safe keeping and transmission of public moneys. That 
 the punctuality of payments is principally due to banks, is a fact generally 
 acknowledged. It is, to a certain degree, enforced by the refusal of credit 
 at the custom house, so long as a former revenue bond, actually due, remains 
 unpaid. But I think ? nevertheless, that, in order to ensure that precision in 
 the collection, on which depends a corresponding discharge of the public en- 
 gagements, it would, if no use was made of banks, be found necessary to 
 abolish, altogether, the credit now given on the payment of duties a measure 
 -which would affect the commercial capital, and tall heavily on the consumers. 
 That the public moneys are safer, by being weekly deposited in banks ? instead 
 of accumulating in the hands of collectors, is self-evident. And their trans- 
 mission, whenever this may be wanted, for the purpose of making payments 
 in other places than those of collection, cannot, with any convenience, be 
 
ON THE BILL TO RENEW THE CHARTER OP 1T91, 
 
 effected, on a large scale, in an extensive country, except through the medium 
 of banks, or of persons acting as bankers. 
 
 The question, therefore, is, whether a bank, incorporated by the United 
 States, or a number of banks, incorporated by the several States, be most 
 convenient for those purposes. 
 
 State banks may be used, amLmust, in case of a non-renewal of the charter, 
 be used by the treasury. Preparatory arrangements have already been made 
 to that effect; and it is believed that the ordinary business will be transacted, 
 through their medium, with less convenience, and, in some respects, perhaps 
 with less safety, than at present, but without any insuperable difficulty. The 
 difference, with respect to safety, results from the organization of the Bank of 
 the United States, by which it is responsible for the money deposited in 
 any of its branches, whilst each of the State banks, which may be employed, 
 will be responsible only for the sums in its own hands. Thus, the Bank of 
 the United States is now answerable for the moneys collected at New Or- 
 leans, and deposited there, in its branches a security which will be lost un- 
 der a different arrangement. Nor will the United States have any other con- 
 trol over the manner in which the business of the banks may be conducted, 
 than what may result from the power of withdrawing the public deposites, 
 and they will lose that which a charter, or a dependence on the General Go- 
 vernment for a charter, now gives over the Bank of the United States. The 
 facility of obtaining such accommodations as may, at times, be wanted, will, 
 for the same reason, be lessened, and the national power will, to (hat extent, 
 be impaired. It may be added, that, even for the ordinary business of re- 
 ceiving and transmitting public moneys, the ilse of a State bank may be for- 
 bidden by the State; and that loans to the United States are, by many of the 
 charters, forbidden, without a special permission from the State. 
 
 As it is not perceived, on the other hand, that a single advantage will ac- 
 crue to the public from the change, no reason presents itself, on the ground 
 of expediency, why an untried system should be substituted to one under 
 which the treasury business has so long been conducted with perfect security 
 to the United States, and great convenience, not only to the officers, but also 
 to all those who have had payments of a public nature to make or to receive. 
 
 It does not seem necessary to advert to the particnlar objections made 
 against the present charter, as these may be easily obviated by proper altera- 
 tions. What has been called a National Bank, or, in other words, a new 
 Bank of the United States, instead of the existing one, may be obtained by 
 such alterations. The capital may be extended, and more equally distributed ; 
 new stockholders may be substituted to the foreigners, as had been suggested 
 in the report of 3d March, 1809; and any other modifications which may be 
 thought expedient, may be introduced, without interrupting the operations of 
 the institution now in force, and without disturbing all the commercial con- 
 cerns of the country. 
 
 If, indeed, the Bank of the United States could be removed without affecting 
 either its numerous debtors, the other moneyed institutions, or the circulation 
 of the country, the ordinary fiscal operations of Government would not be 
 materialy deranged, and might be carried on by means of another general 
 bank, or of State banks. But the transition will be attended with much in- 
 dividual, and probably with no inconsiderable public injury. It is impossible 
 that an institution, which circulates thirteen millions of dollars, and to whom 
 the merchants owe fourteen, should terminate its operations, particularly in 
 the present unfavorable state of the American commerce, and after the great, 
 losses lately experienced abroad, without giving a serious shock to commercial, 
 banking, and national credit. It is not intended to overrate the extent of an 
 evil which there are no certain data to appreciate. And, without expatiating 
 on the fatal and unavoidable effects on individuals; without dwelling on the 
 inconvenience of repaying, at this time, to Europe, a capital of seven millions; 
 and, without adverting to other possible dangers, of a more general nature, it 
 appears sufficient to state, that the same body of men who owe fourteen mil- 
 lions of dollars to the bank, owe, also, ten or twelve to the United States, on 
 
302 BANK OF THE UNITED STATES. 
 
 which the receipts into the treasury, for this year, altogether depend ; and 
 that, exclusively of absolute failures, it is improbable that both debts can be 
 punctually paid at the same time. Nor must it be forgotten that the approach- 
 ing non-importation will considerably lessen the efficiency of the provision, 
 by which subsequent credits are refused to importers who have not discharged 
 former revenue bonds. Upon the whole, a perfect conviction is felt that, in 
 the critical situation of the country, new evils ought not to be superadded, 
 and a perilous experiment be attempted, unless required by an imperious ne- 
 cessity. 
 
 In these hasty remarks, I have not adverted to the question of constitu- 
 tionality, which is not a subject of discussion for the Secretary of the Trea- 
 sury. Permit me, however, for my own sake, simply to state, that the bank 
 charter having, for a number of years, been acted upon, or acquiesced in, as if 
 constitutional, by all the constituted authorities of the nation, and thinking, 
 myself, the use of the banks to be at present necessary for the exercise of the 
 legitimate powers of the General Government; the continuation of a bank of 
 the United States has not, in the view which 1 have been able to take of the 
 subject, appeared to me to be unconstitutional. 
 
 I have the honor to be, respectfully, sir, your obedient servant, 
 
 ALBERT GALL ATI N. 
 
 Hon. WM. H. CRAWFORD, Chairman in Senate. 
 
 FEBRUARY 11, 1811. 
 
 The Senate proceeded to consider the bill reported on the 5th instant, and 
 having amended the same, a motion was made by Mr. ANDERSON to strike 
 out the first section of the bill. 
 
 On motion of Mr. CLAY, the Yeas and Nays were ordered. 
 
 On motion of Mr. BRENT, the further consideration of the bill was post- 
 poned till to morrow. 
 
 Mr. ANDERSON said, that, having been a member of the committee who re- 
 ported the bill before the Senate, and not feeling himself at liberty to oppose 
 the introduction of the report, yet, thinking it might be advisable to try the 
 principle before they proceeded to discuss the details, he should move to 
 strike out the first section of the bill. He would barely observe, that, was 
 this not a question which was generally understood, on which not only every 
 member of this House, but every citizen of the United States, had made up 
 his mind, he should feel himself bound to offer reasons in support of the mo- 
 tion; but, inasmuch as it was a question which every gentleman had doubt- 
 less decided in his own mind, he felt unwilling to take up any more of the at- 
 tention of the Senate, especially so late in the session, when there was so 
 much business of importance before them, which required to be acted on. 
 
 Mr. CRAWFORD said, this was a way of disposing of business which struck 
 him as somewhat astonishing. A bill was proposed to the Senate to continue 
 in operation an institution ot twenty years' standing, the good effects of which 
 had been universally experienced, whose influence on the public prosperity 
 was admitted by all; and, without assigning any reason why it should not be 
 continued, they were told that the public sentiment had decided the question, 
 and every gentleman must have made up his mind. He appealed to the gen- 
 tleman who made the motion, whether this vyas a lair and magnanimous mode 
 of procedure. How was it possible for the friends of this bill to meet objec- 
 tions never made? To foresee the grounds on which gentlemen would have 
 made up their minds? Surely, when a question of magnitude was to be de- 
 cided, it ought to be expected (hat yomc reasons should be offered why the bill 
 
ON THE BILL TO KENEW 1 HE CHARTER OF 1791. 393 
 
 should be rejected. Mr. C. said he hoped, if the honorable gentleman from 
 Tennessee. 1 chose to veil himself and argument from discussion, on the ground 
 that he had made up his mind, that some gentleman would condescend to give 
 reasons in favor of the motion. 
 
 Mr. SMITH (Mil.) said, there was certainly nothing novel in the course ta- 
 ken by the gentleman from Tennessee. The gentleman from Georgia could 
 not be ignorant that some of the State Legislatures had taken the .subject up. 
 It therefore became the duty, with all respect to his friend from Georgia, of 
 the introducer of the bill, to give some reason to induce the Senate to give 
 their votes for a renewal of the charter. 
 
 PHr. ANDERSON ^aid, that he deemed ii strictly proper and parliamentary 
 to make the motion which he had oltered to the House. He deemed it incum- 
 bent on those who meant to support this bill, to assign the reasons why the 
 section should not be struck out. To his mind, Mr. A. said, this system was 
 infinitely more injurious than beneficial; it created a kind of fictitious wealth 
 in the community; destroyed, in a degree, the firm principles of our political 
 institutions; and, if we went on with it for twenty years more, we should be 
 at least fifty years older, he would not say in corruption, but in the want of 
 the strict political virtue, which, if the bank had never existed, we might 
 have maintained. This opinion was a sufficient objection, without saying any 
 thing of the unconstitutional"! ty of the thing, which, to him, had always been a 
 paramount objection. 
 
 Mr. Cuvwi-oKi) said, that the gentlemen from Tenne>-ee and Maryland 
 had misconceived \\hat. he had said. He had not complained that the motion 
 was made; nothing like it. He knew that such a course was sometimes pur- 
 sued. But, it was the fii>t time he ever knew such a motion to be made, 
 without a discussion of the details, without a detailed statement of the rea- 
 sons for opposing such and such provisions, lie must be permitted to slate, 
 that such a course was not usual in this, or any other body, as lhat a chairman 
 should be called up.m to state reasons which induced a committee to report 
 any provision, when a motion was made which went to put an end to any dis 
 Hi of the detail. Gentlemen assumed the affirmative ;side of the ques- 
 tion; they were about to defeat thi- bill: ought they no! lo assign their reason-? 
 What a situation am I placed in. .-aid Mr. ('. How is it possible I can fore 
 >re all the objections to the bill? And, if, perchance I should foresee them, 
 and defeat them, will not gentlemen say these are not the reasons which in- 
 fluenced their votes? !( is like pursuin" a wilt 0* the wisp; you can never 
 arrive at the true object of pursuit. 1 should humbly hope, sir, that some 
 gentleman, who wishes to put an end to this bill, woufd assign the reasons on 
 which he determined to give his vote. 
 
 Mr. SMITH (of Md.) said, lie had always thought it was the duty of a com- 
 mittee to inform the Senate of the reasons which induced them' to report a 
 bill. 1 was not on the committee, said he. There were but five on it; and, 
 consequently, there are twenty-nine of us who cannot tell what induced that 
 gentleman to report the bill which has produced this agitation among us, and 
 which some of the States have declared hostile to the constitution. "I was so 
 certain that the gentleman would give his views of the subject, that I did not. 
 come prepared to enter into the question. I did expect to hear something 
 from that gentleman, which I, or some other gentleman, would have thought 
 it our duty to give an answer to. 
 
 Mr. CRAWFORD said that he should proceed, though reluctantly, to explain 
 the reasons of the committee for reporting the bill which is now under con- 
 sideration. After the most minute examination of the constitution, the ma- 
 jority of that committee were decidedly of opinion, that the Congress of the 
 United States were clearly invested with power to pass such a bill. The ob- 
 
304 BANK OF THE UNITED STATES. 
 
 ject of the constitution was two-fold: 1st, the delegation of certain general 
 powers of a national nature, to the Government of the United States; and 
 2d, the limitation or restriction of the State sovereignties. Upon the most 
 thorough examination of this instrument, I am induced to believe that many 
 of the various constructions given to it are the result of a belief that it is 
 absolutely perfect. It has become so extremely fashionable to eulogise this 
 constitution, whether the object of the eulogist is the extension or contraction 
 of the powers of the Government, that, whenever its eulogium is pronounced, 
 I feel an involuntary apprehension of mischief. Upon the faith of this im- 
 puted perfection, it has been declared to be inconsistent with the entire spirit 
 and character of this instrument, to suppose that, after it has given a general 
 power, it should afterwards delegate a specific power fairly comprehended 
 within the general power. A rational analysis of the constitution will refute, 
 in the most demonstrative manner, this idea of its perfection. This analysis 
 may excite unpleasant sensations; it may assail honest prejudices: for there 
 can be no doubt that honest prejudices frequently exist, and are many times 
 perfectly innocent. But, when these prejudices tend to destroy even the ob- 
 ject of their affection, it is essentially necessary that they should be eradicated. 
 In the present case, if there be any who, under the conviction that the consti- 
 tution is perfect, are disposed to give it a construction that will render it 
 wholly imbecile, the public welfare requires that the veil should be rent, and 
 that its imperfection should be disclosed to public view. By this disclosure, 
 it will cease to be the object of adoration, but it will, nevertheless, be entitled 
 to our warmest attachment. 
 
 The eighth section of the first article of the constitution contains among 
 others the following grant of powers, viz. to coin money, regulate the value 
 thereof, and of foreign coin, and fix the standard of weights and measures; to 
 raise and support armies; to provide and maintain a navy; to regulate com- 
 merce with foreign nations, and among the several States, and, with the Indian 
 tribes; to establish post offices and post roads. This selection contains five 
 grants of general power. Under the power to coin money it is conceived that 
 Congress would have a right to provide for the punishment of counterfeiting 
 the money after it was coined, and that this power is fairly incidental to, and 
 comprehended in, the general power. The power to raise armies and provide 
 and maintain a navy comprehends, beyond the possibility of doubt, the right to 
 make rules for the government and regulation of the land and naval forces; 
 and yet, in these three cases, the constitution, after making the grant of gene- 
 ral power, delegates specifically the powers which are fairly comprehended 
 within the general power. If this however should be denied, the construc- 
 tion which has been uniformly given to the remaining powers which have been 
 selected, will establish the fact beyond the power ot contradiction. Under 
 the power to regulate commerce, Congress has exercised the power of erecting 
 light houses, as incidental to that power, and fairly comprehended within it. 
 Under the power to establish post offices and post roads, Congress has provid- 
 ed for the punishment of offences against the post office department. If the 
 Congress can exercise an incidental power not granted in one case, it can in 
 all cases of a similar kind. But it is said, that the enumeration of certain pow- 
 ers excludes all other powers not enumerated. This is true so far as original 
 substantive grants of power are concerned, but it is not true when applied to 
 express grants of power which are strictly incidental to some original and sub- 
 stantive grant of power. If it were true in relation to them, Congress could 
 not pass a law to punish offences against the post office establishment, because 
 the constitution has expressly given the power to punish offences against tho 
 current coin; and as it has given the power to punish offences committed against 
 that grant of general power, and has withheld it in relation to the power to 
 establish post offices and post roads, Congress cannot, according to this rule 
 of construction, so warmly contended for, pass any law to provide for the 
 punishment of such offences. The power to make rules for the regulation and 
 government of the land and naval forceSj I have shown to be strictly inciden- 
 tal to the power to raise armies, and provide and maintain navies; but, accord- 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 395 
 
 ing to this rule of construction, all incidental powers are excluded except the 
 few which are enumerated, which would exclude from all claim to constitu- 
 tionality nearly one half of your laws, and, what is still more to be deprecat- 
 ed, would render your constitution equally imbecile with the old articles of 
 confederation. When we come to examine the fourth article, the absurdity 
 of this rule of construction, and also of the idea of perfection which has been 
 attributed to the constitution, will be equally manifest. This article appears 
 to be of a miscellaneous character, and very similar to the codicil ot a will. 
 The first article provides for the organization of Congress; defines its powers; 
 prescribes limitations upon the powers previously gran ted; and sets metes and 
 bounds to the authority of the State Governments. The second article provides 
 for the organization of the Executive Department, and defines its power and 
 duty. The third article defines the tenure by which the persons in whom the 
 judicial power may be vested shall hold their offices, and prescribes the extent 
 of their power and jurisdiction. These three articles provide for the three 
 great Departments of Government, called into existence by the constitution, 
 put some other provisions just then occur, which ought to have been included 
 in one or the other of the preceding articles, and these provisions are incor- 
 porated and compose the fourth article. The first section of it declares, that 
 *' full faith and credit shall be given, in each State, to the public acts, records, 
 and judicial proceedings, of every other State; and the Congress may, by gene- 
 ral laws, prescribe the manner in which such acts, records, and proceedings, 
 shall be proved, and the effect thereof." In the second section it declares that 
 a person charged, in any State, with treason, felony, or other crime, who shall 
 flee from justice, and be found in another State, shall, on demand of the Ex- 
 ecutive authority of the State from which he fled, be delivered up, to be re- 
 moved to the State having jurisdiction of the crime. A similar provision is 
 contained in the same section, relative to fugitives who are bound to labor, by 
 the laws of any State. In the first case which has been selected, express au- 
 thority has been given to Congress, to prescribe the manner in which the records, 
 &c. should be proved, and also the effect thereof; but, in the other two, no au- 
 thority is given to Congress; and yet, the bare inspection of the three cases, will 
 prove that the interference of Congress is less necessary in the first than in the 
 two remaining cases. A record must always be proved by itself, because it is 
 the highest evidence of which the case admits. The effect of a record ought 
 to depend upon the laws of the State of which it is a record, and therefore the 
 power to prescribe the effect of a record was wholly unnecessary, and has been 
 so held by Congress no law having been passed to prescribe the effect of a 
 record. In the second case, there seems to be some apparent reason for pas- 
 sing a law to ascertain the officer upon whom the demand is to be made; what 
 evidence of the indentity of the person demanded, and of the guilt of the party 
 charged, must be produced, before the obligation to deliver shall be complete. 
 The same apparent reason exists for the passage of a law relative to fugitives 
 from labor. According, however, to the rule of construction contended for, Con- 
 gress cannot pass any law to carry the constitution into effect, in the two last ca- 
 ses selected, because express power has been given in the first, and is withheld in 
 the two last. But Congress has nevertheless passed laws to carry those provi- 
 sions into effect, and this exercise of power nas never been complained of by 
 the People or the States. 
 
 Mr. President, it is contended by those who are opposed to the passage of 
 this bill, that Congress can exercise no power by implication, and yet it is 
 admitted, nay, even asserted, that Congress would have power to pass all laws 
 necessaiy to carry the constitution into effect, whether it nad given or withheld 
 the power which is contained in the following paragraph of the eighth section 
 of the first article: "To make all laws which shall be necessary and proper for 
 carrying into execution the foregoing powers, and all other powers vested by 
 this constitution in the Government of the United States or in any department 
 or officer thereof." If this part of the constitution really confers no power, 
 it. at least, according to this opinion, strips it of that attribute of perfection 
 which has by these gentlemen been ascribed to it. But, sir, this is not the 
 39 
 
306 BANK OF THE UMTF.I) STATF,*. 
 
 fact. It does confer power, of the most substantial and salutary nat KM 
 Let us, sir, take a view of the constitution upon the supposition that no power 
 is vested in the Government by this clause, and see how the exclusion of pow- 
 er by implication can be reconciled to the most important acts of the Govern- 
 ment. The constitution has expressly given Congress power "to constitute 
 tribunals inferior to the supreme court," but it lias no where expressly given 
 the power to constitute a supreme court. In the third article it is said, " the 
 judicial power of the United States shall be vested in one supreme court, 
 ;;iid iii such inferior courts as the Congress may from time to time ordain and 
 establish." The discretion, which is here given to Congress, is confined to 
 the inferior courts, which it may from time to time ordain and establish, and 
 not to the supreme court. In the discussion which took place upon the bill 
 to repeal the judicial system of the United States, in the year 1802, this dis- 
 tinction is strongly insisted upon by the advocates for the repeal. The su- 
 preme court was said to be the creature of the constitution, and therefore in 
 tangible, but that Congress, possessing a discretionary power to create or not 
 to create inferior tribunals, had the same discretionary power to abolish them 
 whenever it was expedient. But, if even the discretionary power here vested 
 does extendto the supreme court, yet tl>e power of Congress to establish that 
 court must rest upon implication, and upon implication alone. Under the au- 
 thority to establish tribunals inferior to the supreme court, the power to es- 
 tablish a supreme court would, according to my ideas, be vested in Congress 
 by implication. And, sir, it is only vested by implication, even if the decla- 
 ration, that Congress shall have power to pass all laws necessary and proper 
 to carry into elfect the power vested in any department or officer of the Go- 
 vernment, should be held to be an operative grant. Under this grant, Con- 
 gress can pass laws to carry into effect the povyers vested in the judicial de- 
 partment. What are the powers vested in this- department r That it shall 
 exercise jurisdiction in all cases in law and equity arising under this constitu- 
 tion, &c. in all cases affecting ambassadors, &c. but the power to create 
 the department, and to carry into effect the powers given to, or vested in, that 
 department, are very different things. 
 
 The power to create the supreme court cannot be expressly granted in 
 the power to pass all laws necessary and proper to carry into effect the povyers 
 vested in that court, but must, as I have endeavored to prove, be derived 
 from implication. Let me explain my understanding of a power which exists 
 by implication, by an example which will be comprehended by all who hear 
 me. in a devise, an estate is granted to A, after the death of 13, and no ex- 
 press disposition is made of the estate during the life of A;' in that case, A is 
 said to have an estate for life, by implication, in the property so devised. So, 
 when the constitution gives the right to create tribunals inferior to the su- 
 preme court, the right to create the supreme, is vested in Congress by impli- 
 cation. Shall we, after this, be told that Congress cannot constitutionally 
 exercise any right by implication? By the exercise of a right, derived only 
 from implication, Congress has organized a supreme court, and then, as in- 
 cidental to this power, existing only by implication, it has passed laws to 
 punish offences against the law by which the court has been created and or- 
 ganized. Sir, the right of the Government to ?ccept of the District of Colum- 
 bia exists only by implication. The right of the Government to purchase or 
 accept of places tor the erection of forts, magazines, arsenals, and dock-yards, 
 exists only by implication; and yet no man in the nation, so far as my know 
 ledge extends, has complained of the exercise of these implied powers, as an 
 unconstitutional usurpation of power. The right to purchase or accept of 
 places for the erection of light houses, as well as the right to erect and support 
 light houses, must be derived by implication alone, if any such right exists. 
 The clause in the constitution which gives Congress the power " to exercise 
 exclusive legislation, in all cases whatsoever, over such district (not exceeding 
 ten miles square) as may, by cession of particular States, and the acceptance 
 of Congress, become the seat of Government of the United States, and to 
 exercise like authority over all places purchased by the consent of the Legis- 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 3Q7 
 
 lature of the State in which the same shall be, for the erection of forts,. maga- 
 zines, arsenals, dock yards, and other needful buildings," certainly gives no 
 cept or purchase any of the places, destined for the^ uses 
 he 01 " 
 legisj 
 
 111U.OI UV_, \lVsI ft Y\.\A J llYlJjIl V-lti."^ i i\'.*. v -~. , - 
 
 comprehended in, or incidental to, some other power, expressly delegated by 
 the constitution. I shall now attempt to show, that, according to the con- 
 struction which has been given to other parts of this constitution, Congress 
 has the right to incorporate a bank, to enable it to manage the fiscal concerns 
 of the nation. If this can be done, and if it can also be shown that the cor- 
 rectness of such construction has never excited murmur or complaint that 
 it has not even been questioned I shall have accomplished everything which 
 it will be incumbent on me to prove, to justify the passage of the bill upon 
 yoftr table. The power to lay and collect taxes, duties, imposts, and excises, 
 together with the power to pass all laws which may be necessary and proper 
 
 late commerce, Congress exercises the right of building and supporting light- 
 houses. What do we understand by regulating commerce? Where do you 
 expect to find regulations of commerce? Will any nun look for them any 
 where else than in your treaties with foreign nations, and in your statutes regu- 
 lating your custom houses and customhouse officers? What are the reasons 
 for vesting Congress with the right to regulate commerce with foreign nations, 
 and among the several States? The commerce of a nation is a matter of the 
 greatest importance in all civilized countries. It depends upon compacts 
 with other nations; and whether they are beneficial or prejudicial, depends 
 not so much on the reciprocal interest of nations us upon their capacity to de- 
 fend their rights and redress their wrongs. It Was, therefore, highly impor- 
 tant that the right to regulate commerce with foreign nations should be vested 
 in the national Government, I!' the regulation of commerce among the seve- 
 ral States had boon left with the States, a multiplicity of conflicting regula- 
 tions would have been the consequence. landless collisions would have been 
 created, and that harmony and good neighborhood, so essential between the 
 members of a federal republic, would have been wholly unattainable. The 
 best interest of the community therefore imperiously required, that this power 
 should be delegated to Congress. Not so of light houses. The interest of 
 the States would have induced them to erect light houses, where they were 
 necessary, and when erected they would have been equally beneficial to their 
 own vessels, the vessels of their sister States, and ol foreign nations. The 
 performance of this duty could have been most safely confided to the States. 
 They were better informed of the situations in which they ought to be erect- 
 ed, than Congress could possibly be, and could enforce the execution of such 
 regulations as might be necessary to make them useful. How then has it 
 happened that Congress has taken upon itself the right to erect light houses, 
 under their general power to regulate commerce? [ have heard and seen, in 
 the public prints, a great deal of unintelligible jargon about the incidentally 
 of a law to the power delegated and intended to be executed by it, and of its 
 relation to the end which is to be accomplished by its exercise, . which I ac- 
 knowledge I do not clearly and distinctly comprehend, and must, therefore, 
 be excused from answering. I speak now of the public newspapers to which 
 I am compelled to resort to ascertain the objections which are made to this 
 measure, as gentlemen have persevered in refusing to assign the reasons which 
 have induced them to oppose the passage of the bill. But, sir, I can clearly 
 comprehend that the right to erect light houses is not incidental to the power 
 of regulating commerce, unless every thing is incidental to that power which 
 tends to facilitate and promote the prosperity of commerce. It is contended 
 that, under the power to lay and collect taxes, imposts, and duties, you can 
 pass all laws necessary for that purpose; but they must be laws to lay and 
 
SOS . BANK OF THE UNITED STATES. 
 
 collect taxes, imposts, and duties, and not laws which tend to promote the 
 collection of taxes. A law to erect light houses is no more a law to regulate 
 commerce, than a law creating a bank is a law to collect taxes, imposts, and 
 duties. But the erection of light houses tends to facilitate and promote the 
 security and prosperity of commerce, and, in an equal degree, the erection 
 of a bank tends to facilitate and ensure the collection,, safe-keeping, antt 
 transmission, of your revenue. If, by this rule of construction, which is ap- 
 plied to light houses, but denied to the bank y Congress can, as incidental to- 
 the power to regulate commercev ereet light houses, it will be easy to show 
 that the same right may be exercised, as incidental to the power of laying and 
 collecting duties and imposts. Duties cannot be collected^ unless vessels 
 importing dutiable merchandise arrive in port; whatever, therefore y tends to 
 secure their safe arrival, may be exercised under that general power; the erec- 
 tion of light houses does facilitate the safe arrival of vessels in port; and Con- 
 gress, therefore, can exercise this right as incidental to the power to lay imposts 
 and duties, 
 
 But it is said the advocates of the bank differ among themselves in fixing, 
 upon the general power to which the right ta create a bank is incidental, and 
 that this difference proves that there is no ineidentality, to use a favorite ex 
 pression, between that and ay one of the enumerated general powers. The 
 same reason can be urged with equal force against the constitutionality of 
 every law for the erection of light houses. Let the advocates for this doc- 
 trine lay their finger upon the power to which the right of erecting light houses 
 is incidental. It can be derived, with as much apparent plausibility and rea- 
 son, from the right to lay duties, as-from the right to regulate commerce. Who 
 is there now in this body who has not* voted for the erection of a light house? 
 And no man who reads one of these y will believe it to be a regulation of com- 
 merce. And no man in tke nation y so far as my knowledge extends, has ever 
 complained of the exercise of this power. The right to erect light houses is 
 exercised, because the commerce of the nation, or the collection of duties, is 
 greatly facilitated by that means; and, sir, the right to create a bank is exer- 
 cised, because the collection of your revenue, and the safe keeping and easy 
 and speedy transmission of your public money, is not simply facilitated, but 
 because these important objects are more perfectly secured by the erection of a 
 bank than they can be by any other means in the power of human imagina- 
 tion to devise. We say, therefore, in the words of the constitution, that a 
 bank is necessary and proper to enable the Government to carry into com- 
 plete effect the right to lay and collect taxes, impo3ts T duties, and excises. 
 We do not say, that the existence of the Government absolutely depends 
 upon the operations of a bank, but that a National Bank enables the Govern- 
 ment to manage its fiscal concerns more advantageously than it could do by 
 any other means. The terms necessary and proper, according to the con- 
 struction given to every part of the constitution, impose no limitation upon- 
 the powers previously delegated. If these words had been omitted in the 
 clause giving authority to pass laws to carry into execution the powers vested 
 by the constitution in the National Government, still Congress would have 
 been bound to pass laws which were necessary and proper, and not such as 
 were unnecessary and improper. Every Legislative body, every person in- 
 vested with power of any kind, is morally bound to use only those means 
 which are necessary and proper for the correct execution of the powers de- 
 legated to them. But, it is contended, that, if a bank is necessary and proper 
 for the management of the fiscal concerns of the nation, yet Congress has no 
 power to incorporate one, because there are State banks which may be resorted 
 to. No person who has undertaken to discuss this question, has, as far as 
 my knowledge extends, ventured to declare, that a bank is not necessary, 
 Every man admits, directly 91- indirectly, the necessity of resorting to banks 
 of some kind. This admission is at least an apparent abandonment of the 
 constitutional objection: for, if a bank is necessary and proper, then have 
 Congress the constitutional right to erect a bank. But this is denied. It is 
 contended that this idea rests alone upon the presumption that the Govern- 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 ment of the United States is wholly independent of the State Governments; 
 which is not the fact. That this very law is dependent upon the State courts 
 for its execution. This is certainly not the fact. The courts 6 the United 
 States have decided, in the most solemn manner, that they have cognizance 
 of all cases affecting the Bank of the United States. Sir, it is true that the 
 Government of the United States is dependent upon the State Governments 
 for its organization. Members of both Houses of Congress, and the Presi- 
 dent of the United States, are chosen by the State Governments, or under 
 the authority of their laws. But it is equally true, that, wherever the consti- 
 tution confides to the State Governments the right to perform any act in re- 
 lation to the Federal Government, it imposes the most solemn obligation upon 
 them to perform the act. The constitution of the United States, as to these 
 particular acts, is the constitution of the several States, and their function- 
 aries are accordingly sworn to support it. Can it then be seriously contended 
 that, because the constitution has, in some cases, made the Government of 
 the United States dependent upon the State Governments, in all which cases 
 it has imposed the most solemn obligations upon them to act, that it will be 
 necessary and proper for Congress to make itself dependent upon them, in 
 cases where no such obligation is imposed? The constitution has defined all 
 :he cases where this Government ought to be dependent upon that of the 
 States, and it would be unwise and improvident for us to multiply these cases 
 y legislative acts, especially where we have no power to compel them to per- 
 orm the act for 
 
 ng a permanent 
 
 or its collection and transmission from one extreme of this extensive empire 
 o the other, upon any accidental circumstance, wholly beyond their power 
 r control. There are State banks in almost every State in the Union, but 
 Jieir existence is wholly independent of this Government, and their dissolu- 
 ion is equally so. The Secretary of the Treasury has informed you that he 
 conceives a bank is necessary to the legitimate exercise of the powers vested 
 ly the constitution in the Government; I know, sir. that the testimony of this 
 officer will not be very highly estimated by several honorable members of this 
 oody. I am aware that this opinion has subjected him, and the committee 
 also, to the most invidious aspersions; but, sir, the situation of that officer, 
 independent of his immense talents, enables him to form a more correct 
 opinion than any other man in the nation, of the degree of necessity which 
 exists at the present time for a National Bank, to enable the Government to 
 manage its fiscal operations. He has been ten years at the head of your trea- 
 sury; he is thoroughly acquainted with the influence of the bank upon your 
 revenue system; and he has, when called upon, declared that a bank is neces- 
 sary to the proper exercise of the legitimate powers of the Government. His 
 testimony is entitled to great weight in the decision of this question, at least 
 with those gentlemen who have no knowledge of the practical effects of the 
 operations of the bank in the collection, sate keeping, and transmission of 
 your revenue. In the selection of means to carry any of your constitutional 
 powers into effect, you must exercise a sound discretion; acting under its 
 influence, you will discover that what is proper at one time, may be extremely 
 unfit and improper at another. The original powers granted to the Govern- 
 ment by the constitution, can never change with the varying circumstances 
 of the country; but the means by which those powers are to be carried into 
 effect, must necessarily vary with the varying state and circumstances of the 
 nation. We are, when acting to-day, not to inquire what means were neces 
 sary and proper twenty yeurs ago; not what were necessary and proper at the 
 organization of the Government; but our inquiry must be, what means are 
 necessary and proper this day. The constitution, in relation to the means by 
 vhich its powers are to be executed, is one eternal now. The state of things 
 now, the precise point of time when we are called upon to act, must deter- 
 mine our choice in the selection of means to execute tne delegated powers. 
 
 It is said, that the States have reserved to themselves the exclusive right 
 of erecting banks. That the States have exercised the right of establishing 
 
310 BANK OF THE UNITED STATES. 
 
 banks, is a fact not to be denied; but that they have this right under the con- 
 stitution, is extremely questionable. Had these great States, who have un- 
 dertaken, by their instructions, to influence the decision of this question by 
 Congress, contented themselves with the exercise of this right to establish 
 banks, I should not, upon this occasion, enter into an investigation of that right. 
 But these great States, not content with the exercise of an usurped authority, 
 are, by usurpation, attempting to legislate for Congress. 
 
 And, sir, what is the inducement with these great States, to put down the 
 Bank of the United States? Their avarice, combined with the love of domi- 
 nation. They have erected banks, in many of which they hold stock to a 
 considerable amount, and they wish to compel the United States to use their 
 banks as places of deposite for their public moneys, by which they expect to 
 increase their dividends. And in the banks in which they hold no stock, 
 many of the individual members of their Legislatures are stockholders, and 
 no doubt were influenced to give instructions by motives of sheer avarice. 
 The love of power, no doubt, lias had some influence in producing these in- 
 structions. Every person who is not wholly ignorant of the history of this 
 Government, knows something of the influence of these great States upon the 
 councils of the nation. 
 
 Have we not heard it said, that, after three of the great States had instruct- 
 ed their members to vote against the bank, it was a matter of too great deli- 
 cacy for Congress to think of acting upon the subject? I had thought that 
 the rights of the States were equal; that, if the rights of three of the little States 
 were violated or affected, in any manner, that it was the subject of as much 
 delicacy, as if the rights of three great States had been affected.. Sir, if this 
 doctrine becomes fashionable, if two or three great States can, upon all occa- 
 sions, through the agency of their Legislatures, control the deliberations of 
 Congress, you will compel the smaller States, by the most direful necessity, 
 to adopt the principle ot one consolidated Government. Which of the States 
 are to be principally benefitted by the dissolution of the bank? Those States 
 in which the principal part of your revenue is to be collected. The great 
 commercial States are to monopolize the benefits which are to arise from the 
 deposites of your public money. The suppression of this bank will benefit 
 none of the interior, or smaller States, in which there is little or no revenue 
 collected. As the whole benefit is to be engrossed by three or four of the 
 great Atlantic States, so the whole of the power, which the dissolution of this 
 bank will take from the National Government, will be exclusively monopo- 
 lized by the same States. Is it desirable to increase the influence of these 
 great States, which is already too great, at the expense of the United States? 
 Does not the history of these great States admonish us, in the most impres- 
 sive terms, to beware of placing this Government in a. state of dependence 
 upon them? Sir, the time has been, and it will certainly arrive again, when 
 some one or more of these great States will be found in a state of hostility to 
 the National Government; and, with this knowledge, you are about to place 
 the management ot your public money in the hands ot the State banks, who 
 are dependent, for their legal existence, upon the State Governments. But, 
 sir, permit me to examine this exclusive right of the State Governments to 
 create banks. In the tenth section of the first article of the constitution of 
 the United States, it is declared, among other things, that no State shall coin 
 money; emit bills of credit; make any thin, but gold or silver, a tender in 
 the payment of debts. AVhat, sir, is a bill ot credit? Will it be contended 
 that a bank bill is not a bill of credit? They are emphatically bills of credit. 
 But it may be said, that the States do not, by the creation of banks, with 
 authority to emit these bills of credit, infringe upon the constitution, be- 
 cause they do not emit the bills themselves. If they have not the power 
 to emit bills of credit, a fortiori, they cannot delegate to others a riglit 
 which they themselves cannot exercise. But, sir, according to the maxims 
 of law and sound reason, what they do by another they do themselves. 
 If, then, the State Governments are restrained from exercising this right 
 to incorporate a bank, it would appear ex necessitate ret that this right 
 is vesteu in the Government of the United States. The entire sover- 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 3]J 
 
 eignty of this nation is vested in the State Governments, and in the Fede- 
 ral Government, except that part of it which is retained by the People, which 
 is solely the right of electing their public functionaries. The right to create 
 a corporation, is a right inherent in every sovereignty; the People of the United 
 States cannot exercise this right. If, then, the States are restrained from cre- 
 ating a bank, with authority to emit bills of credit, it appears to be establish- 
 ed that the Federal Government does possess this right. If, however, it is 
 still believed that the law, by which this bank has been created, was the re- 
 sult of a forced construction of the constitution, yet I must contend, that that 
 construction is entitled to some weight in the decision of this question. The 
 time and state of the public mind, when this construction was given, gives it 
 a strong claim to consideration upon this occasion. This construction was 
 given shortly after the Government was organized, when first impressions had 
 riot been effaced by lapse of time, or distorted by party feelings, or individual 
 animosity. This law did riot puss in the hard unconstitutional times which 
 produced the sedition law. No, sir, this law passed in the best days of this 
 republic. At that time the idea of party, as now understood, was wholly un- 
 known. The parties which then existed were literally federal and anti-fede- 
 ral. Those who were friendly to the federal constitution, and those who were 
 inimical to it, formed the only party then known in this nation. What, sir, 
 is the situation in which we are now placed? What are the circumstances 
 under which we are called upon to reject this bill? The great influential 
 States, induced by motives ol avarice and ambition, interpose the. weight of 
 their authority; attempt to put a veto upon your right to pass such laws as are 
 necessary and proper for the general welfare, through the instrumentality of 
 instructions, by depriving not only their Senators and Representatives of 
 the exercise of a sound and honest discretion, but, also, by intimidating others 
 by the weight of their influence and authority. The democratic presses in 
 these great Statcv have, for more than twelve months pa.4, teemed with the 
 most scurrilous abuse again.-t every member of Congress who lias dared to 
 litter a syllable in favor of the renewal of the bank charter. The member who 
 dares to give his opinion in favor of the renewal of the charter, is instantly 
 charged with being bribed by the agents of the bank with being corrupt with 
 having trampled upon the rights and liberties of the People with having sold 
 the sovereignty of the United States to foreign capitalists with being guilty 
 of perjury, by having violated the constitution. Yes, sir, these are the < n 
 ciunstances under which we are called upon to reject the bill, When we 
 compare the circumstances under which we are now acting, with those which 
 existed at tlie time when Hie law was passed to incorporate the bank, we may 
 vyell distrust our own judgments. Sir. I had always thought that a corpora- 
 tion was an artificial body, existing only in contemplation of law; but, if we 
 can believe the rantings of our democratic editors in these great States, and 
 the denunciations of our public declaimers, it exists under the form of every 
 foul and hateful beast, and bird, and creeping thing. It is an Hydra; it is a 
 Cerberus; it is a Gorgon; it is a J'ltllure; it is a f'iper. Yes, sir, in their 
 imaginations it not only assumes every hideous and frightful form, but it pos- 
 sesses every poisonous, deleterious, and destructive quality. Shall we. sir, 
 suffer our imaginations to be alarmed, and our judgments to be influenced, by 
 such miserable stuff? Shall we tamely act under the lash of this tyranny of 
 the press? No man complains of the discussion in the newspapers, of any 
 subject which conies before the Legislature of the Union: butl most solemnly 
 protest against the course which has been pursued by these editors, in rela- 
 tion to this question. Instead of reasoning, to prove the unconstitutionality 
 of the Ia\y. they charge members of Congress with being bribed or corrupted; 
 and this is what they call the liberty of the press. To tyranny, under what- 
 ever form it may be exercised, I declare open and interminable war. To me 
 it is perfectly indifferent whether the tyrant is an irresponsible editor, or a 
 despotic monarch. 
 
 Mr. President, if the construction which has been given to the constitution 
 is entitled to no weight with the members who now compose the Senate, will 
 
312 BANK OF THE UNITED STATES. 
 
 it be contended that the different acts of successive democratic Congresses, 
 by which they have sanctioned the validity of the construction under which 
 this bank was created, are entitled to no weight or consideration? Perhaps 
 it would be unfair to lay any stress upon the simple acquiescence of our de- 
 mocratic predecessors in this measure; I shall, therefore, show, that the acts 
 to which I allude were positive affirmative acts, and not simply, or in any 
 degree, acts of acquiescence. By the charter, the corporation was authorized 
 to establish offices of discount and deposite wheresoever it should think fit, 
 within the United States. In the year 1803, the United States obtained Lou- 
 isiana by purchase. Under the authority given in the charter, the corpora- 
 tion could not extend its branches into Louisiana. In the year 1804, a demo- 
 cratic Congress passed a law to authorize this devouring monster to lay its 
 destructive fangs upon the unfortunate people of these newly acquired terri- 
 tories. It has been said that the State Governments were competent to resist 
 the execution of this law. How ungenerous, tben, was it, in our democratic 
 predecessors, to authorize this institution, with its pestilential fangs, to seize 
 upon these helpless and unfortunate people, who had no State Governments 
 competent to resist the execution of this law, and shield them from the deadly 
 poison of this venomous viper? It was unkind; it was cruel. Permit me, 
 sir, to make one or two observations upon this competency of the State Go- 
 vernments to resist the authority or the execution of a law of Congress. 
 What kind of resistance can they make, which is constitutional? I know of 
 but one kind; and that is by elections. The People, and the States, have a 
 right to change the members of the National Legislature, and, in that way, and 
 in that alone, can they effect a change of the measures of this Government. 
 
 It is true, there is another kind ot resistance which may be made, but it is 
 unknown to the constitution. This resistance depends upon physical force; 
 it is an appeal to the sword; and by the sword must that appeal be decided, 
 and not by the provisions of the constitution. 
 
 We are informed, however, that the States thought it most prudent to acqui- 
 esce in this law, and waive the right of resisting it, to which they were so en- 
 tirely competent. 
 
 Does the positive sanction of this measure, by our democratic Congresses, 
 rest alone upon this act of 1804? No, sir. The act by which the bank was in- 
 corporated, made no provision for the punishment of those who might counter- 
 feit its bills and checks. In the year 1798, a law for the punishment of such 
 offences was passed. In the year 1807, a democratic Congress, composed 
 of many of the same members who are now called upon to act again upon the 
 subject of the bank, passed a law also for the punishment of the same offences 
 against the bank. This is not all, sir; so great was the unanimity of both 
 Houses upon this question, that the bill passed through both Houses without 
 producing a call for the yeas and nays upon its final passage, or in any of its 
 intermediate stages. The constitution says, Congress shall make laws " to 
 provide for the punishment of counterfeiting the securities and current coin 
 of the United States." I have shown that the power to punish counterfeiting 
 the current coin was fairly incidental to the power of coining money. But 
 the power to punish counterfeiting the securities is an original grant of power, 
 and not incidental to any one of the delegated powers. As the constitution 
 has given the power to punish counterfeiting the securities and the current 
 coin, expressly, according to the doctrine contended for by the enemies of the 
 bank, the power to punish any other species of forgery is withheld. But let 
 us pursue this idea a little further. The law incorporating the bank is de- 
 nounced as unconstitutional; it therefore is not binding upon the People of the 
 United States as a law; and yet the very men who denounce it, who declare 
 it to be unconstitutional, have passed a law to condemn those who violate its 
 provisions to ten years' imprisonment, and to enormous fines. With what 
 propriety can we say that our republican predecessors have simply acquiesced 
 in tnis measure? With what consistency can we now refuse to renew the char- 
 ter, on account of the want of constitutional power? But it is contended that 
 we have done nothing more than simply acquiesced in this measure, and that 
 our acquiescence was wholly the result of a conviction that the act incorpo- 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 rating a bank was a contract. What, sir, is the essence of a contract? That 
 there shall be parties able to contract; that they do contract; that there shall 
 be a consideration; a quid pro quo; that the conditions shall be reciprocal. 
 What is the fact in relation to the bank bill? Does the bank make any stipu- 
 lations in favor of the Government? No, none. Does the charter stipulate 
 that the Government shall provide for the punishment of those who counter- 
 feit bank bills? No. And yet a republican Congress, under the idea, I sup- 
 pose, of its being a contract, has passed a law lor that purpose. The law does 
 not contain one essential feature of a contract; it is therefore no contract. 
 
 If I have succeeded in establishing the constitutional right of this House to 
 pass a bill to incorporate a bank, the remaining part of the task which I have 
 undertaken to perform will be easily despatched. What are the circumstances 
 under which we are called upon to vote against the renewal of the charter of 
 the Bank of the United States? Europe is still convulsed to its centre by wars, 
 which, in their progress, have overthrown the ancient bounds and limits of 
 the independent nations among whom it has been immemorially parcelled out. 
 The established usage and law of nations have been trampled under foot, both 
 by land and sea. Such is the prospect abroad. What is our own internal 
 situation? The confiscation of American property in the ports of France, Spain, 
 Italy, and Holland; tin? depredations committed upon our commerce on the 
 high seas, by British cruisers; and the embarrassments to which it has been 
 subjected in the northern ports of Europe, havi- already produced numerous 
 bankruptcies in most of our commercial cities. In addition to the embarrass- 
 ments produced by thcs" cau>es we have superaddod those which must ne- 
 cessarily result from a non-intercourse with England, the country with which 
 we have hitherto had the most extensive commercial intercourse. From these 
 additional embarrassments we may be saved by the want of good faith in the 
 French Government. Should that be the case, we *.hall most inevitably be 
 excluded from all commercial intercourse with the European continent, which 
 may be as embarrassing as the non-intercourse with Great Britain, in that 
 event, our European commerce will be confined solely to Great Britain and 
 her dependencies. Such, sir, arc the circumstances under which we are call- 
 ed upon to dissolve suddenly an institution which circulates thirteen millions 
 of dollars, and to which the commercial class of this nation are indebted four- 
 teen millions of dollars. It must also be remembered, that the same class of 
 your citizens are indebted to the Government nearly twelve millions of dollars, 
 upon which your payments into the treasury for the discharge of the current 
 expenses of the year arc solely dependent. Sir, I have never believed that 
 the mantle of Elijah has descended upon my shoulders, and yet I can very 
 easily foresee that individual and national distress must be produced by the 
 sudden dissolution of the bank. The poorer part of your manufacturers and 
 mechanics will be the first to fed the distress. The deputation of mechanics 
 and manufacturers from the city of Philadelphia stated to the committee, that, 
 upon the rejection of the bill for the renewal of the charter, in the other House, 
 the bank began to contract its discounts, and that the whole city was tilled 
 with alarm and dismay; that the credit even of bank paper was shaken, and 
 individual confidence had received a severe shock; that, in consequence of 
 this alarm and distress, the bank had determined to return to its former ex- 
 tent of discounts, and to continue it to the last moment; that the contraction 
 of discounts, by the Bank of the United States, had produced a contraction^ 
 discounts in the State banks, so that those who had their accounts with the 
 latter banks were in no better situation than the debtors of the former. When- 
 ever a man testifies against his apparent interest, he ought to be believed. It 
 is apparently the interest of the State banks that the Bank of the United States 
 should be put down. It is their interest to discount good paper as largely as 
 possible. The Bank of the United States discounts to the amount of about 
 fifteen millions of dollars. The dissolution of this bank will bring into the 
 market, which will then be solely occupied by the State banks, an excess of 
 fifteen millions of good paper to b discounted. The demand for discounts, 
 when compared w:th th j discounting < ii irif--$l, will be greatly increased, and 
 40 
 
314 BANK OF THE UNITED STATES. 
 
 the benefit of that increase will be exclusively enjoyed by the State banks; 
 it is therefore apparently their interest, that the Bank of the United States 
 should be dissolved. But they have petitioned for the renewal of the charter, 
 It is said, however, that if so much distress is to flow from the dissolution 
 of the bank, it proves that the banking system is deleterious in its conse- 
 quences. I will not now enter into the discussion of that question, because 
 it is not the question before the Senate. The system has long been practised 
 upon; is increasing from day to day, and is wholly beyond the control of Con- 
 gress. But, sir, an inspection of the journals of the Senate, of the present 
 session, affords abundant evidence that this House, at least, believe that the 
 banking system is a beneficial one. We have not incorporated more, I be- 
 lieve, than five banks within the District of Columbia, during the present 
 session. The renewal, or the refusal to renew this charter, does not then 
 decide the question whether the banking system shall be abolished in the 
 United States or not. Gentlemen cannot but be sensible of this. The old 
 Congress incorporated the Bank of North America in the year 1781. New 
 York and Massachusetts had followed the example before the Bank of the 
 United States was incorporated, and every State in the Union has since in- 
 corporated banks- The banking system has been too long and too deeply 
 rooted, to be frowned out of existence by Congress. If, however, gentlemen 
 are convinced that the system of banking known and established among us is 
 injurious in its effects, these injurious effects will be diminished by renewing 
 the charter of the Bank of the United States. The State banks, whose cre- 
 dibility, in this case, is unquestionable, have told you that the influence of 
 the Bank of the United States upon them is a beneficial one; that it prevents 
 excessive discounts and emissions of paper, which, but for this check, would 
 inevitably take place in the State banks. Every one of the State banks of 
 Philadelphia, except one, has petitioned for the renewal of the Bank of the 
 United States, and one of the deputation of merchants, who was a director of 
 one of those banks, stated the reason why that bank had declined. That an 
 association in some of the interior towns had been formed, without the autho- 
 rity of law, and that the bank was suspected, by the State Legislature, of 
 having favored it; that a motion had been made in the State Legislature to 
 inquire into the fact, and tha*, in consequence of this circumstance, that bank 
 had been prevented from petitioning. The check which one bank has upon 
 another is, in fact, the only substantial check which can be devised against 
 excessive discounts and emissions by State banks. You may limit and restrain 
 them by subjecting the directors, individually, to any loss which may be in- 
 curred by a violation of the restrictions imposed by the charter. Suppose 
 
 the renewal of the charter, that it has been a political machine in the hands 
 of our political opponents, and that it has been partial in its operations. 
 That it may have been so used is very possible; but that it has, within the last 
 twelve years, been so used, is not believed. Some "of the delegation of the 
 mechanics, all of whom, 1 believe, were democrats, had been dealers with 
 that bank for twelve years, and they all united'in contradicting all idea of its 
 being partial, or influenced, in the slightest degree, by the political character 
 of its customers, during that time. And one of them said, explicitly, that 
 opposition to the renewal in Philadelphia was confined principally to the 
 newspapers. When there were but few banks, and the competition for dis- 
 counts was great, I can readily believe that it might have had some influence 
 upon political questions, and that it was guilty of partiality; and so would any 
 other institution be, placed in the same situation. The multiplication of banks, 
 in the United States, has given us the most ample security against the repeti 
 tion of either of these offences. The most formidable objection against the 
 expediency of the renewal, in the estimation of those who are opposed to it, is, 
 that a large portion of the stock is held by foreigners; and apprehensions are 
 entertained that these foreigners have had, and will again have, some influence 
 
ON THE BILL TO RENEW THE CHARIER OF 1791. 
 
 upon our public councils; that, but for the influence thus acquired, we should 
 have taken stronger measures in vindication of our rights. It' this influence 
 really exists, some degree of influence must also exist and operate upon those 
 foreigners in our favor. If the most profitable part of their capital is that 
 which is invested in our bank stock, which the Government has sold to them, 
 will they not exert their influence upon their own councils, upon any appre- 
 hension of war between the two countries? Surely the country in which their 
 capital is employed, and who can, at any moment, lay their hands upon it, 
 must have more influence upon the conduct of the capitalists, than they can 
 possibly have upon it. How long shall we frighten ourselves with empty 
 phantoms and imaginary evils? How long shall we indulge ourselves in the 
 pursuit of some imaginary theoretical good, which, like the will o" the wisp, 
 continually eludes our grasp? Sir, we have the experience of twenty years 
 for our guide. During that lapse of years .,your finances have been, through 
 the agency of this bank, skilfully and successfully managed. During this 
 period, the improvement of the country, and the prosperity of the nation, have 
 been rapidly progressing. Why, then, should we, at this perilous and mo- 
 mentous crisis, abandon a well tried system; faulty, perhaps, in the detail, 
 but sound in its fundamental principles? Does the pride of opinion revolt at 
 the idea of acquiescing in the system of your political opponents? Come! and 
 with me sacrifice your pride and political resentments at the shrine of politi- 
 cal good. Let them be made a propitiatory sacrifice for the promotion of the 
 public welfare, the savor of which will ascend to Heaven, and be there re- 
 corded as a lasting, an everlasting evidence, of your devotion to the happiness 
 of your country. 
 
 FEBRUARY 12 t 1811. 
 
 Motion to strike out the first section of the bill. 
 Mr. LKIB spoke in favor of the motion, and Mr. LLOYD against it. 
 
 Mr. LEIB said that it was not his intention to have broken silence on this 
 subject; he meant to content himself with a silent vote, as he considered the 
 merits of the bill to be well understood, and every member's mind made up 
 on them. The subject had become so trite, and was so hackneyed, as to have 
 become threadbare, and he united in opinion with his friend from Tennessee, 
 that it was not only a waste of time, but a work of supererogation to discuss 
 it. He should not have risen but for some remarks which had yesterday 
 fallen from the gentleman from Georgia. Some intimation had been given by 
 him about instructions from the great States, and while it seemed to be mat- 
 ter of complaint that such instructions had been given, it appeared, also, that 
 the complaint extended to the non-production of them to the Seriate. Pie 
 had received instructions from a great State, as the gentleman from Georgia 
 had termed it for he did not recollect that the gentleman from Maryland, to 
 whom the phrase was attributed, had used it the great State of Pennsylva- 
 nia: and those instructions he would have ottered to the Senate before, had 
 not some informality in their shape precluded him. The instructions having 
 been mentioned, he deemed it a duty to read them to the Senate. 
 
 In the General Assembly of the Commonwealth of Pennsylvania. 
 
 The People of the United States, by the adoption of the federal constitution, esta- 
 blished a General Government for special purposes, reserving to themselves, respec- 
 tively, the rights and authorities not delegated in that instrument. To the compact, 
 thereby created, each State acceded, in its charter, as a State, and is a party; the 
 United States forming, ?s to it, the other party the act of union, thus entered into, 
 being, to all intents and purposes, a treaty between sovereign States. The General 
 Government, by this treaty, was not constituted the exclusive or final judge of the 
 powers it was to exercise: for, if it were so to judge, then its judgment, and not the 
 constitution, would be the measure of its authority. 
 
316 BANK OF THE UNITED STATES. 
 
 Should the General Government, in any of its departments, violate the 
 the constitution, it rests with the States and with the People, to apply suitable 
 remedies. 
 
 With these impressions, the Legislature of Pennsylvania, ever solicitous to secure 
 an administration of the Federal and State Governments, conformably to the true spirit 
 of their respective constitutions, feel it their duty to express their sentiments upon an 
 important subject now before Congress, viz. the continuance or establishment of a 
 bank. From a careful review of the powers vested in the General Government, they 
 have the most positive conviction that the authority to grant charters of incorpora- 
 tion, within the jurisdiction of any State, without the consent thereof, is not recogniz- 
 ed in that instrument, either expressly, or by any warran table implication: Therefore, 
 Resolved by the Senate and House of Representatives of the Commonwealth of Penn- 
 sylvania in General Assembly met, That the Senators of this State in the Senate of the 
 United States be, and they are hereby, instructed, and the Representatives of this 
 State in the House of Representatives of the United States be, and they hereby are, 
 requested, to use every exertion in their power to prevent the charter of the Bank of 
 the United States from being renewed, or any other bank from being chartered by 
 Congress, designed to have operation within the jurisdiction of any State, without 
 first having obtained the consent of the Legislature of such State . 
 
 Resolved,' Thai the Governor be, and he hereby is, requested to forward a copy of 
 the above preamble and resolution to each of the Senators and Representatives of this. 
 State in the Congress of the United States. 
 
 JOHN WEBER, 
 Speaker of the House of Representatives. 
 
 P. C. LANE, 
 Speaker of the Senate. 
 
 Lv THE HOUSE OF REPRESENTATIVES, January llth, 1811. 
 Read and adopted. 
 
 Attest, GEO: HECKERT, 
 
 Clerk of the House of Representatives. 
 
 Ix SENATE, January llth, 181 I. 
 Read and adopted. 
 
 Attest, JOSEPH A. M'JIMSEY, 
 
 Clerk of the Senate, 
 
 Wherefore, he would ask, was this made a cause of complaint? The instruc- 
 tions were given by the Legislature of Pennsylvania to their Representatives. 
 Was the right of the constituent denied to instruct his Representative? For 
 the instructions extended not beyond the representation. It was an affair be- 
 tween Representatives and constituents, and as it did not proceed beyond 
 them, as none else were comprehended, surely no cause could have been 
 given for complaint. For his part he assented to the right of constituents to- 
 instruct, and was readv to yield it obedience it was in accordance with his 
 political maxims; and he should ever consider himself bound to obey instruc- 
 tions as long as they did not require the performance of an act, which would 
 violate that oath which he had taken. On this occasion he yielded obedience 
 with pride and pleasure, as the instructions corresponded with his own im- 
 pressions of solemn obligation. He considered himself as]thc Representative of 
 the State of Pennsylvania; to represent, in his mind, was to appear for, or 
 stand in the place of, the body represented, and, in this view, he considered it 
 his duty to speak the sense of his constituents: to do as they would dp, were 
 they present; otherwise he should misrepresent them. Did this look like dic- 
 tation? Did it appear as if the great States desired to give law to the smaller 
 ones, when they only gave their instructions to their own Representatives, and 
 none else were asked to render them obedience? He could not suppose it. 
 
 Allusion had been made to Pennsylvania on account of resistance to the 
 laws of the United States. He felt the reproach, and had often experienced 
 mortification from it. He had never countenanced unlawful opposition, nor 
 had the People of Pennsylvania: for, when it had existed, it had been local, 
 and had never embraced the State; and, therefore, the People of Pennsylvania 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 not comprehended in the reproach. The gentleman from Georgia had 
 cited authority for renewing the charter of the Bank of the United States, and 
 had at the same time disclaimed authority; in imitation of his example he would 
 do so too, and he might say, that, for the excitement to?insurrection in a part 
 of Pennsylvania, he might refer to a source of authority as high as the gentle- 
 man from Georgia had referred for the establishment of the bank charter. 
 
 Some reasons had been assigned for the refusal of the Farmers and Mecha- 
 nics' Bank of Philadelphia to unite with the other banks, in petitioning for a 
 charter, which did not appear to him to be correct. The gentleman who gave 
 the information to the committee was director of the Bank of Philadelphia, 
 and his information must have been derived from out of doors rumor. The 
 Farmers and Mechanics' Bank, Mr. Leib apprehended, refused to petition for 
 the renewal of the charter of the Bank of the United States, for other reasons. 
 He knew a gentleman who managed the aftairs of that bank, of superior intel- 
 ligence and information, and second to none in point of knowledge of bank- 
 ing, who was as much opposed to a renewal as he was, and for a reason not 
 unlike that hinted at by the gentleman from Georgia, that the Bank of the 
 United States was a check upon the other banks, but a check like that of a, 
 shark upon the little fish around him. It was in the power of the Bank of the 
 United States, by means of its great capital and the Governmental patronage, 
 to prey upon the other banks whenever it pleased, and this was sufficient rea- 
 son for the Farmers and Mechanics' Bank to refuse its aid towards a renew- 
 al of the charter. These remarks he thought it his duty to submit to the Sen- 
 ate, and, in conformity with his first determination, he avoided any remarks 
 upon the merits of the bill, which he conceived every member was already pre- 
 pared to decide upon. 
 
 MK. LLOYD. Mr. President: This is, indeed, sir, an up-hill, wind-mill 
 sort of warfare a novel mode ot Legislative proceeding. That a bill should 
 be brought in, on a very important subject, wfrich has been long under consi- 
 deration, and that a gentleman should move to strike out the first section of 
 the bill, which comprises all its vitality, (for it is the first, section which pro- 
 vides for the continuance of the bank) and should be supported in it, without 
 deigning to assign any other reasons than may be derived from newspaper 
 publications, which are so crude and voluminous that not one man out of ten 
 will so far misspend his time as to take the trouble to read them, is indeed ex- 
 traordinary. Still, if gentlemen choose to adopt this dumb sort of legislation, 
 and are determined to take the question without oflfering any arguments in 
 support of their opinions, I certainly should not have interfered with their 
 wishes, had 1 not been a member of the committee who had reported the bill, 
 who had heard the testimony ottered by two very respectable delegations 
 from Philadelphia one from the master manufacturers and mechanics of the 
 city, and the other from the merchants; and had 1 not taken minutes of this 
 testimony, which 1 find it is expected from me that I should relate to the 
 Senate. 
 
 Sir, I consider the motion to strike out, now under consideration, as going 
 to the entire destruction of the bill, without any reference to its details or mo- 
 difications; it, therefore, appears to me in order, to take into consideration 
 only the material principle of the bill : that is, whether it be proper that the 
 charter of the bank should be renewed on any terms whatever, let those terms 
 be what they may. 
 
 [General SMITH of Maryland stated, that the gentleman was mistaken: he 
 was at liberty to go into consideration of the details, and might discuss them 
 if he pleased.] 
 
 1 had thought, Mr. President, that when a section of a bill was moved to be 
 struck out, that the subject matter of the part so moved to be stricken out was 
 only in order to be considered^but, however this may be, I take it to be strict- 
 ly in order to show, that this bank has been ably and fairly conducted; that it 
 has been beneficial to the country, and extremely useful to the Government; 
 
318 BANK OF THE UNITED STATES. 
 
 because, if this be shown, it will be the best argument that can be adduced 
 for the rejection of the present motion, and the continuance of the bank. 
 
 Sir, it is admitted by the Secretary of the Treasury, in his communications 
 to Congress, that the concerns of this bank have been " skilfully and wisely 
 managed;" that the bank has made a very limited and moderate use of the 
 public moneys deposited with it; and that it has greatly facilitated the opera- 
 tions of Government by the safe keeping and transmission of the public mo- 
 neys. It has at all times met the wishes of the Government in making loans. 
 It lias done this even at six per cent, while the Government have been oblig- 
 ed, in one instance, for a considerable amount, to nay 8 per cent, to other per- 
 sons for the loans obtained from them. It is admitted, sir, that the bank, at 
 the request of the Treasury Department, has established branches for the pur- 
 pose of facilitating the operations of the Government at places where such es- 
 tablishments could not but be inconvenient to them in point of management, 
 and disadvantageous in point of profit. I allude more particularly, sir, to the 
 branches of the bank which have been established at New Orleans and at 
 Washington. We have been told this session, sir, by a, gentleman from Ma- 
 ryland, (Mr. SMITH) that the territory of Orleans is a very wealthy one; that 
 it probably contains a greater number of rich inhabitants, for its population, 
 than any other district in the Union. Sir, if this be the fact, of whom does 
 this wealthy population consist? Not of the inhabitants, but of the planters; 
 men who are not borrowers of the bank; who, when they realise the sales of 
 their produce, invest the surplus proceeds of it, beyond their expenditure, in 
 the funds, or in the acquisition of new lands, or in the purchase of an addi- 
 tional number of negroes. Sir, it is notorious, that, from the recent posession 
 by the United States of Louisiana, and the certainty that New Orleans must 
 soon be the emporium of an immense western commerce, that city has become 
 more the resort of the young, the adventurous, the enterprising, and the rash, 
 among the mercantile men of our country, than any other city in the Union; 
 and it is obvious, sir, in proportion as the borrowers from a bank consist of 
 persons of this description, in the same proportion must ihe circumstances of 
 such bank be unsound; and, without possessing any particular knowledge 
 whatever on the state of this bank, if the collections of its debts are speedily 
 made, I would not make the purchase at a discount of twenty-five per cent, 
 from the nominal amount of them. 
 
 Sir, we can judge with more accuracy when we come nearer home. What 
 is the state of the bank in this city? What the ability of its debtors to meet 
 their engagements? It is stated the branch has a loan out here of four hundred 
 thousand dollars. Where is the navigation? Where the wealthy merchant? 
 Where are the opulent tradesmen? The extensive manufacturers to refund 
 this money when they are called on to do it? Sir, they are not to be found : 
 they do not exist here; there are but very few opulent men in the city, and 
 those are either not borrowers of the bank, or not borrowers to an amount of 
 any importance. Where, then, is the money to be found , or what has been done 
 with it? It has probably been taken out of the Bank of the United States to 
 build up the five or six District banks which you have chartered the present 
 session; to furnish the means of erecting the fifty or sixty brick houses which 
 we are told have made their appearance during the last summer; to encourage 
 speculations in city lots, and to enable the proprietors to progress with the 
 half finished canal which nearly adjoins us. Well, sir, if the bank promptly 
 calls in its loan of four hundred thousand dollars, will the debtors be enabled 
 to meet their payments? Can they sell these city lots, these brick houses, 
 these canal shares? No, sir, in such a state of things they could find no pur- 
 chasers; they could nearly as well create a world as to furnish the money; 
 and if the bank is to stop, and the payment of this debt be speedily coerced, I 
 would not give two hundred thousand dollars for the whole of it. 
 
 In addition to this, I shall show presently, from testimony which cannot be 
 controverted, that the conduct of the Bank of the United States ? or its direct- 
 ors, or rather the stockholders, whose agents they are, in addition to being 
 wise, and skilful, and moderate, as the Secretary of the Treasury states them 
 
ON THE BILL TO RENEW THE CHARTER OP 1791. 3JQ 
 
 to have been, that they have also been honorable, and liberal, and impartial; 
 and if, in addition to this, it be proved that the bank has, in every instance 
 where it had the ability to doit, met the wishes of the Government, and, to 
 facilitate its views in the security and collection of the revenue, it has also es- 
 tablished branches where it must have been obviously and palpably to the 
 disadvantage of the bank to do it; if it has furnished capitals for the exten- 
 sion of our commerce, if it has provided means for the establishment of import- 
 ant manufactories, if it has had a tendency to raise the price of our domestic 
 produce, and has thus encouraged industry, and improved and embellished 
 the interior of the country; it would seem pretty strongly to follow, that, if it 
 be expedient to preserve the existence of an institution similar to this, then 
 these gentlemen, on the score of merit, added to the experience of twenty 
 years' successful operation, have a fair claim on the Government for a prefer- 
 ence in favor of that which is already in operation. 
 
 I am aware, sir, that it may be stated, jin opposition to this claim, that these 
 stockholders have enjoyed a boon for twenty years, from which others of their 
 fellow-citizens have been deprived, except on such terms as the sellers of 
 shares chose to prescribe; that the charter expires by its own limitation, and 
 that, beyond this period, they have no right to expect any thing which may not 
 arise from the interest and convenience of the Government. I admit, sir, 
 there is considerable strength in these objections. The exclusive right contained 
 in the charter ever appeared to me as furnishing the most solid constitutional 
 objection against the bank. The creation of monopolies, the granting of ex- 
 clusive privileges, except so far as to secure to the authors of useful inventions 
 the benefit of their discoveries; the tying up of the hands of the Legislature, 
 and depriving itself of the power of according to a set ot citizens, who may 
 come into legal existence to-morrow, or ten years hence, what it had given to 
 another; ever appeared to me hostile to the genius and spirit of the People of 
 the United States, and otall their institutions. Highly, then, sir, as I am in- 
 duced to think of the conduct of this bank, from the best evidence I can ob- 
 tain, still, from the considerations I have just mentioned, did the question 
 now before us simply affect the stockholders, I should certainly not trouble 
 the Senate with any remarks in reference to it, and should sit down in entire 
 acquiescence, whether the prayer of their petition for the renewal of the char- 
 ter of the bank wore granted or rejected. 
 
 Sir, before quitting this idea of constitutional objection, permit me to make 
 one or two brief remarks in regard to it. It is impossible tor the ingenuity ot 
 man to devise any written system of government, which, after the lapse of 
 time, extension of empire, or change ot circumstances, shall be able to carry 
 its own provisions into operation; hence, sir, the indispensable necessity of 
 implied or resulting power.-, and hence the provision in the constitution that 
 the Government should exercise such additional powers as were necessary to 
 carry those that had been delegated into effect. Sir, if this country goes on 
 increasing and extending, in the ratio it has done, it is not impossible that 
 hereafter, to provide for all the new cases that may arise under this new state 
 ot things, the defined powers may prove only a text, and the implied or result- 
 ing powers may furnish the sermon to it. 
 
 Permit me, sir, to put one question on this head, in addition to those so ably, 
 and, to my view, unanswerably put yesterday, by the honorable gentleman from 
 Georgia (Mr. CRAWFORD.) Whence, sir, do you get the right, whence do 
 you derive the power to erect custom houses in the maritime districts of the 
 United States? To attach to them ten, fifteen, or twenty custom house offi- 
 cers, and clothe these men with authority to invade the domicile, to break 
 into the dwelling-house of perhaps an innocent citizen? Whence do you get 
 it, sir, except as an implied power, resulting from the authority given in the 
 constitution, " to lay and collect taxes, duties, imposts, and excises?" If, un- 
 der this authority, you can erect these custom houses, and create this municipal, 
 fiscal, inquisitorial gens (Farmerie, with liberty to violate the rights of the 
 citizen, to break into his castle at midnight, without even a form ot a warrant, 
 on a plausible appearance ot probability, or probable cause of suspicion of his so % 
 
320 BANK OF THE UNITED STATES. 
 
 creting smuggled goods, which the event may prove to be unfounded -and it will 
 be recollected that a majority of Congress voted for the grant of this power in 
 its most offensive form, when, two years since, they voted for the act enforcing 
 the embargo I say, sir, if. under this general power to collect duties, you can 
 erect the establishment and give the offensive power just mentioned, can you 
 not, with the concurrence even of the citizens, adopt another more mild and 
 useful mode, and create an establishment for the collection and safe-keeping 
 of the revenue, and place it under the direction of ten or twelve directors, 
 and christen it an office of Discount and Deposite, or of Collection and Pay- 
 ment, as you like best? And can you not, when you have thus created it, give 
 to the, directors ft power, which, perhaps, they would have without your grant, 
 to receive and keep the cash of those who choose to place it with them, and to 
 loan them money at the legal rate of interest, and, in some places, as at New 
 York, at nearly fifteen per cent, below the legal rate of interest? If you can 
 do this, then you have your bank established, sir, and most assuredly, if you 
 can do one of these things, you can do the other. 
 
 Sir, the constitutional objection to this bank, on the ground that Congress 
 had not the power to grant an act of incorporation, has ever appeared to me 
 most unsound and untenable. Still, gentlemen of intelligence and of integrity, 
 who have thought long and deeply on the subject, think differently from me; 
 and I feel bound to respect their opinions, however opposed they maybe to my 
 own. Yet, sir, I will venture to predict, without feeling any anxiety for 
 the fate of the prophecy, that, should this bank be suffered to run down, such 
 will be the state of things, before this time twelve months, that there are other 
 gentlemen, who at present have constitutional objections, but who have not 
 thought so long and deeply upon them, will, before that time, receive such a 
 flood of intelligence, as, on this head, perfectly to dispel their doubts, and quiet 
 their consciences. 
 
 Sir, I shall now proceed, as briefly as may be in my power, to state the situa- 
 tion of this bank on the expiration of its charter, and the effects on the com- 
 munity consequent on it. There is now due to the bank, from individuals, fif- 
 teen millions of dollars. _ These fifteen millions of dollars must be collected; 
 the power of the bank to grant discounts will have ceased, and the duty of the 
 directors must require them to make the collection. Sir, how is this to be done? 
 Whence can the money be obtained? I shall demonstrate to you, presently, 
 that already, from an apprehension of a non-renewal of the charter of the 
 bank, business is nearly at a stand; that navigation, real estate, and mer- 
 chandise, are unsaleable; and that a man worth one hundred thousand dollars, 
 at the recently rated value of property, and owing 10,000 dollars, must still 
 be utterly unable to meet his engagements. Suppose, sir, this property con- 
 sists in houses or shipping; suppose his warehouse is full of goods, and he has 
 a large sum placed at his credit in England: If, sir, he can neither sell his 
 ships, nor his goods; if he cannot sell his real estate, nor scarcely give away 
 his exchange, which, hitherto, to men who had money in England, has been a 
 never failing source of supply in case of need; I say, under these circumstan- 
 ces, sir, whatever may be his property, he cannot meet his engagements. Sir, 
 can men, thus situated, solvent as they ought to be ten times over, find relief 
 from the State banks? Certainly not, sir. These banks have already gone 
 to the extreme length of their ability; they have always discounted to an 
 amount in proportion to their capital, exceeding that of the Bank of the United 
 States, which is incontrovertibly proved by the dividends they have declared, 
 which have at most universally equalled and frequently exceeded those of the 
 Bank of the United States, notwithstanding the advantage enjoyed by the lat- 
 ter from the deposite of public moneys. Sir, so far from having it in their pow- 
 er, in the case of the dissolution of the Bank of the United States, to assist 
 the debtors to that bank in meeting their engagements to it, I affirm the fact, 
 on which 1 have myself a perfect reliance, that, take the State banks, from 
 Boston to Washington, and after paying their debts to the Bank of the United 
 States, they have not, nor do I believe they have had, for six months back, 
 specie enough to pay the debts due to their depositors, and the amount of their 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 bills in circulation. And here I beg it to be observed, that bank bills, and 
 bank deposites, or credits, are precisely the same thing with this difference, 
 that the latter, from the residence in the neighborhood of the banks, and the 
 vigilance of the proprietors, would be the first called for. How idle is it then 
 to expect to obtain relief from banks which have already extended themselves 
 beyond the bounds of prudence, and have not even at present the ability to 
 meet their existing engagements? It might nearly as well be expected that 
 a man who was already a bankrupt should prop and support his failing 
 neighbor. 
 
 Sir, much has been recently said of the amount of specie in the United 
 States. Theoretical men have made many and vague conjectures about it, for, 
 after all, it must rest upon conjecture. Some have estimated it at ten millions 
 of dollars, some twelve, some twenty, and some newspaper scribblers at forty 
 millions of dollars. Sir, I do not believe that, for the last ten years, the United 
 States have at any time been more bare of specie than at the present moment. 
 A lev/ years since, specie flowed in upon us in abundance. This resulted 
 principally irorn an operation of a very singular and peculiar nature. The Spa- 
 nish Government, as it was then understood, agreed to pay to France a very 
 large sum of money many millions of dollars, the precise number I am una- 
 ble to state from her possessions in South America. France contracted with 
 a. celebrated English banking house, as was said at the time, with either the 
 concurrence or connivance of the English Government, that this money should 
 be obtained through the United States. These bankers, by their agent, con- 
 tacted with certain American houses, principally 1 believe in Baltimore, for 
 the importation of this specie from La Vera Cruy. into the United States, from 
 whence it was not transmitted in coin to Europe, but invested in adventures 
 in the shipments of produce, the proceeds of which ultimately go into the 
 hands of these bankers in London, or of their friends on the continent, from 
 whom it was finally realized by the French Government, either by drafts 
 from Paris or remittances to that city. This operation had a trebly favorable 
 ell'ect on the United States it made fortunes for some of the merchants, it 
 furnished the means of shipments to Eurone ? and it also provided the funds 
 for adventures to the East Indies and to China. But this contract has now 
 been finished some years; and since that time there has been a constant drain 
 of specie from the country. Where it is in future to be procured from, I 
 know not. Not from South America specie is, I believe, protected from 
 exportation there, except to Spain. From Spain we cannot get it to a great 
 part of what was Spain we have now scarcely any trade. From France it 
 cannot be obtained: tor, if we can get there even by licence, we are obliged to 
 bring back her produce or manufactures. From England it cannot be im- 
 portedit is now made highly penal to attempt to send it out of the kingdom. 
 SVith South America we have but little trade; hitherto we furnished them 
 with smuggled or licensed European and India goods, but now the markets 
 are flooded with these goods, by importations direct from England, and which 
 have been attended with great loss to the shippers. For these reasons, it is 
 difficult to find a vessel sailing from the United States to the Spanish ports in 
 South America. These are among the reasons why the amount of specie 
 now in the country is small, and has for some time past been gradually les- 
 sening. Sir, without indulging in vague conjectures, what are the best data 
 trom which we have to form an estimate of the amount of specie in the country? 
 The Bank of the United States has five millions of dollars in its vaults. In Bos- 
 ton there are three State banks; in New York I believe four; Philadelphia 
 four; and Baltimore eight; call these nineteen, twenty, and allow on an aver- 
 age one hundred and fifty thousand dollars specie, which probably is as much 
 as they generally possess, and this will make three millions of dollars; this 
 amount, united to the sum in the vaults of the Bank of the United States 
 gives eight millions of dollars, to which, if you allow two millions of dollars 
 tor a loose circulation of specie, you get an aggregate of ten millions of dol- 
 lars. \\e are sometimes told of the large sums of money hoarded incur 
 country by individuals; probably there may be some among the German 
 4 1 
 
322 BANK OF THE UNITED STATES. 
 
 farmers in Pennsylvania perhaps more in that State than in any other, or alt 
 the others in the Union, but still of no great amount the reputation of a little 
 money possessed in this way easily swells into a large sum. At any rate, let 
 the amount be what it may, in time of distress and mistrust, it would afford 
 no addition to your circulating medium: for it is precisely in times like these, 
 that men who hoard money will lock it up most securely. 
 
 Sir, the circulation of our country is at present emphatically a paper circu- 
 lation; very little specie passes in exchange between individuals; it is a cir- 
 culation bottomed on bank paper and bank credits, amounting perhaps to fifty 
 millions of dollars. And on what, sir, does this circulation rest? It rests 
 upon the ten millions of dollars, if that be the amount of specie in the country, 
 and upon public confidence. 
 
 The Bank of the United States has fifteen millions of dollars to collect; 
 call it ten, sir nobody will dispute this no one will pretend that this bank, 
 is not solvent the remnant ot'its surplus dividends, and the interest it will' 
 have earned, will be sufficient to cover its losses at New Orleans, at Wash- 
 ington, arid perhaps elsewhere. In what are these ten millions of dollars to be 
 collected? In bank bills, the credit of which is at least doubtful? No, Sir, 
 in specie; and when this is entirely withdrawn from the State banks, and the 
 banks are unable to pay the money for their bills, who does not see that this 
 confidence is instantly destroyedthat the bubble bursts that floods of paper 
 bills will be poured in upon them, which they will be unable to meet, and 
 which will for a time be as worthless as oak leaves; that the banks themselves 
 must at least temporarily become bankrupts; and that a prostration of credit, 
 and of all those habits of punctuality which, for twenty years, we have been 
 striving so successfully to establish, will inevitably ensue, and, with them 
 also, there must be suspended the commerce, the industry and manufactures- 
 of the country; and a scene of embarrassment and derangement be produced,, 
 which has been unexampled in our history. 
 
 I will now make a very few remarks on the effects which the dissolution of 
 the bank will have on the revenue and fiscal concerns of the country. Can it 
 be supposed, sir, that the source to which will be imputed the distress that 
 will have flowed from this event, will be the first to be thought of, to be guard- 
 ed against a participation of the evils that will result from it, in preference to 
 the claims of the most intimate friends and connexions? No, sir, the bond* 
 due to the United States will be collected only at the tail of an execution. 
 But I mean not to press this consideration. Admit, for a moment, that they 
 will all be equally well collected; that they will be paid as usual, although it 
 is palpable, that, fora considerable time, the merchants will be unable to find 
 the means to pay them; yet, admit, sir, that the money is collected in the 
 State banks, how is it to be transmitted? It must come to the centre of the 
 Seat of Government; very little of the public money is expended in the North- 
 ern section of the Union. Will it come from the Eastward, in bills of the 
 State banks? Penobscot bank bills sometimes will not pass in Boston; Boston 
 bills pass with difficulty in New York or Philadelphia; and bills of New York 
 State banks probably would not be readily current in Washington. You 
 must, then, sir, if Boston gives you a revenue of two millions of dollars, trans- 
 mit the greater part of it to the seat of Government, or wherever else it may 
 be wanted, in specie. Can this be done? We have not two millions of dol- 
 lars of specie in our town, and, I may almost venture to say, never had^ Sup- 
 pose you make this transmission once, can you do it the second time? No, 
 sir, the thing is utterly impracticable. You must adopt some other mode. 
 Exchange between the ditterent cities will not reach the case; frequently it 
 cannot be purchased even for an insignificant amount. . 
 
 Sir, will your money, when collected, be safe in the State banks? Jt this 
 I am extremely doubtful. Solicitations will undoubtedly be made for it from 
 all quarters. They have already been made. In one instance, I am told, sir, 
 the agent of a bank, even during the few past weeks, has been here for the 
 purpose; that suddenly the agent was gone, and in a few days it was discover- 
 ed that, owing to the failure of one of the debtors to the bank which he repre- 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 sented, (a great broker) the stock had fallen in one day near twenty per cent. 
 What was tliis the evidence of, but that those who were most interested in 
 this bank, the stockholders who were on the spot, and best acquainted with its 
 solidity, were willing to wash their hands of their concern in it, at almost any 
 rate of sacrifice? Sir, I only state this, as it was here reported, I have no 
 personal knowledge on the subject. But will you trust your funds with an 
 institution thus precarious, and whose solidity is distrusted even by its best 
 friends? 
 
 By an account of the receipts and expenditures for the year 1810, laid on 
 our tables. I find there lias been passed to the credit of the United States $390 
 received from the Lincoln and Kennebeck bank, *in Massachusetts, as an in- 
 terest on the public money while deposited in that bank. The history of this 
 credit of interest, is, I presume, the following: The money was deposited at 
 the bank for account ot the United States; the bank used the money for its 
 own accommodation, and when called on for the amount could not refund it. 
 This allowance of interest is, therefore, for the time during which the bank 
 could not pay the money. The amount, in this instance, is small, sir, and the 
 United States have received a compensation for the use of the money. It 
 proves, however, what has [been done, and will be done again. Suppose it 
 should be done on a large scale, and when the Government wants its funds, 
 it cannot command them; an interest on the amount will not pay the salaries 
 of the officers of the nation; it will not feed your armies, nor suport your 
 navy; it must derange the whole system of the Government, and, perhaps, 
 bring it to a stand still. 1 have no hesitation, sir, in declaring, that, in my 
 opinion, if the collection and transmission of the public moneys be entrusted 
 exclusively to the State banks, that, at least, great trouble, perplexity, and 
 occasional defalcation will ensue. 
 
 I shall now present, sir, to the Senate, the testimony which was offered to 
 the committee by the two delegations from Philadelphia, the one selected from 
 the master manufacturers and mechanics, and the other from the merchants 
 of that city. It will go conclusively to show the effects which it is apprehended 
 will ensue from the cessation of the Bank of the United States in a city, the 
 first, perhaps, in population and wealth in the Union, and the one least engaged, 
 of any of the great seaports, in proportion to its wealth, in foreign commerce. 
 
 The agents from the manufacturers and mechanics told their story in a plain, 
 straight forward manner, each one narrating facts which affected himself, and 
 came within the scope of his personal observations. The representatives of 
 
 the former testimony, which was very impressively given to the committee, will 
 be stated in detail, and the latter be presented in a much more comprised and 
 concise form, 
 
 Mr. Leiper, a respectable, wealthy, and extensive tobacconist, and a pro- 
 prietor also of some stone quarries, which furnish considerable building stone 
 to the masons in Philadelphia, informed the committee, that he had been long 
 and extentively engaged in a tobacco manufactory. He employs upwards ot 
 a hundred workmen, and the expenses of his business amount to about one 
 hundred and sixty dollars a day; he believes that the dissolution of the Bank 
 of the United States would produce a scene of distress in the seaports unpre- 
 cedented in our country; that it would stop one-half of the master manufac- 
 turers and mechanics of the city; that, already, confidence was nearly de- 
 stroyed; the debts due to manufacturers and mechanics were on open account*, 
 on which it was impossible to make collections to any amount of consequence; 
 that the manufacturers and mechanics must, unless the state of things be al- 
 tered, in a great measure stop their business, and dismiss their workmen, and 
 very many of them sacrifice their property, or lose their reputation, and stop 
 payment. Money, he said, could not be commanded, a short time since, how- 
 ever good the security offered; he generally met his engagements easily; he 
 liad, however, shortly before leaving home, occasion to remit to his correspon- 
 
324 BANK OF THE UNITED STATES. 
 
 dent at Richmond, where he was in the habit of having considerable quantities 
 of tobacco purchased, fourteen hundred dollars; he had on hand towards this 
 sum eight hundred dollars, and found considerable difficulty in procuring the 
 remainder; it had, however, been clone since he left home, arid remitted, with 
 directions, however, to the agent, to make no more purchases, nor to enter 
 into any new contracts for his account. 
 
 Mr, Leiper further stated^ that the pressure for money, which recently ex- 
 isted in Philadelphia, has, for the moment, been relieved, although scarcely 
 any sales or purchases are making, except at greatly reduced and destructive 
 rates to the seller. This relief had been obtained, by the Bank of the United 
 States agreeing to continue its full discounts to the 4th of March next; and 
 from the State banks, calculating on the forbearance of the Bank of the 
 United States, having liberally issued new paper. The Bank of Pennsylvania, 
 of which Mr. Leiper has been many years a director, recently let out, in one 
 week, eighty thousand ^dollars of new money; but if the Bank of the United 
 States is not continued, this momentary relief would only extend the evil, as 
 it would enlarge the liabilities, and still further increase the pressure and dis- 
 tress, and want of money which must then arise- 
 
 About seventeen years since, Mr. Leiper felt hurt at the conduct of the 
 Bank of the United States in rejecting his paper; he left the bank, and did 
 his business elsewhere: since that time he had heard no complaints; he be- 
 lieved the concerns of the bank had been conducted fairly and liberally, and 
 that discounts had been afforded to democrats as well as to federalists, to 
 manufacturers and mechanics, as well as the merchants. 
 
 Mr. Leiper, sir, has been a zealous and unwavering partizan of the persons 
 now in power, since the adoption of the federal constitution, and his testimo- 
 ny will not probably be thought entitled to less weight on that account, 
 
 Mr. Grice, a respectable master ship carpenter, in large business, informed 
 the committee that there are now building, in Philadelphia, 9,145 tons of 
 shipping, a list of which he exhibited to the committee; a lager amount of 
 tonnage than was ever before on the stocks in that city, and which, when fin- 
 ished, would cost about a million of dollars; that the whole of this shipping 
 had been contracted for,, except about 1000 tons; that the work was to be 
 done and delivered in the course of the ensuing spring; that there were em- 
 ployed in the city, in connexion with this business, about 2,000 persons; that,, 
 owing to the apprehensions excited by the expected non- renewal of the char- 
 ter of the Bank of the United States, great inconvenience had been already 
 experienced by all classes of men iti that city; that confidence was nearly de- 
 stroyed; he could neither obtain money to pay his workmen or to carry on 
 his business^ that the former,, unless a change took place, he must dismiss; 
 that such had been the rapid growth of the navigation of the United States, it 
 was difficult to procure good workmen, was highly important to keep them in 
 the country, and would be extremely disadvantageous to have them drawn 
 out of it; that already., owing to the great increase of ship building in Canada,, 
 agents were endeavoring to induce mem to leave the United States for that 
 country, where they could earn more money than at home. That, if the bank 
 was obliged to stop, the master ship carpenters could neither borrow money 
 nor collect their debts, and must of necessity dismiss their workmen*. in which 
 case very many of them would leave the United States, and probably never 
 return. That he did not believe that more than two or three of the persons 
 who had contracted for vessels, in the event of the dissolution of the bank- 
 would be able to fulfil their contracts; that,. in consequence, the vessels would 
 be left on the hands of the builders, who, on their part, would be unable to 
 meet their engagements; and that the vessels must finally be sold for the most 
 they would fetch, probably at half their value, to the great loss, and perhaps 
 ruin of the builders. 
 
 He had been himself largely in business, and had dealt for many years with 
 the Bank of the United States: he had ever been treated liberally and kindly 
 by it; he viewed himself indebted, in a considerable degree, for his present 
 standing in society, to the accommodations he had received at that bank; still,. 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 in the course of his business, he occasionally took notes, at three, four, or six 
 months, which, having a longer time to run than that at which the bank dis- 
 counted, of sixty days, he found it convenient to convert into money; this, 
 hitherto, he could always readily do, by carrying the notes to a wealthy mer- 
 chant, for whom he sometimes did business, and who, hitherto, had always 
 been willing to discount them for him, at bank interest; that, being cut oft" 
 from his usual discounts at the bank, he recently endeavored to avail himself 
 of this resource, but found it wholly shut against him; that the gentleman 
 whose funds had, hitherto, appeared inexhaustible, would now aftord no re- 
 lief; confidence was destroyed; he knew not who was safe, he would make 
 no new discounts, were the answers he obtained instead of money. 
 
 Mr. Grice stated that this out-of-door discounting had been of great service 
 to the manufacturers and mechanics, as they could frequently get money from 
 it, when they could not obtain discounts at the banks; he had reason to be- 
 lieve that the amount of money thus employed in the city, at the legal and 
 advanced rates of interest, was not less than seven millions of dollars; that 
 this resource was now wholly cut off: they who had money would not loan it 
 at any rate, and kept it on hand, either to secure it, or to derive an exorbi- 
 tant advantage from the necessities and sacrifices of others. Mr. Grice be- 
 lieved that, with very few exceptions, all classes in Philadelphia were in 
 favor of the renewal of the charter of the bank; without it, he believed great 
 numbers of persons would be rendered bankrupts, and general distress, at 
 least among the manufacturers and traders, would en 
 
 Mr. Vogdes, a master house carpenter, in extensive business, informed the 
 committee there were, at this time building, about five hundred brick houses, 
 in Philadelphia, two thirds of which belonged to the mechanics of the city, 
 who arc in the habit of purchasing lots of land on credit, and who, with their 
 own capitals, which, in many instances, are small, and by borrowing of the 
 banks, or of individuals, and buying materials on credit, are enabled to erect 
 buildings, on the sale of which they depend for tin? means of meeting their 
 engagements; that he himself at present owns buildings of this description, 
 on the sale of which he had calculated, to the amount of $130,000. He em- 
 ploys 100 workmen. 
 
 Mr. Vogdes stated he had been in the habit of receiving a moderate accom- 
 modation at the bank; he had ever been well treated by the. bank; the direc- 
 tors had recently reduced his notes, but not in so great a degree as the State 
 banks had done; that the expected termination of the charter of the Bank of 
 the United States had greatly incommoded him, and others probably more; 
 it had nearly suspended all business among the manufacturers and mecha- 
 nics; it had stopped all sales of real estate, which he does not believe could 
 now be effected at so high a rate, within 30 per cent, as the sales could have 
 been made at some time since; he had himself engaged to sell two houses, 
 one for $10,000, the contractors for which had fallen from their engagements 
 under one small pretence or another, but, really, as he believes, from the 
 change of times, and the difficulty there existed in procuring money to meet 
 the engagements even of the most wealthy persons; he himself had a note of 
 one of the most respectable arid undoubted men in the city; he offered it at 
 three banks, but could not obtain a discount on it, and was finally obliged, in 
 order to meet his engagements and pay his workmen, to sell it at one and a 
 half per cent, per month discount; he knew a broker who had notes to the 
 amount of half a million of dollars laying by him for sale, which were con- 
 sidered good, but which he could not dispose of at any rate; he had a mort- 
 gage which he was constrained to sell at 18 per cent, for twelve months: and 
 his son, to pay his workmen, was obliged to have his note discounted on the 
 best terms at which it could be done, which were at 2 per cent, per month. 
 
 Mr. Vogdes is concerned in some rolling and slitting .mills, which work 
 about 500 tons of iron annually. The proprietors have now on hand about 
 100 tons of manufactured iron; commonly it is very saleable, at present, 
 owing to the causes that have been mentioned, there is no demand for it. It 
 is usual for manufacturers of iron to lay in their stock when the importa- 
 
326 BANK OF THE UNITED STATES. 
 
 tions are largest, generally late in the autumn; this, several ot them have 
 clone. The price is usually from $108 to $120 per ton; it has, however, fallen, 
 from the pressure of the times ? to $85 per ton. This difference the manu- 
 facturers must suffer, which, in addition to the want of sale for their manu- 
 factures, and the other disadvantages under which they labor, if relief be not 
 speedily obtained, must ruin most of those who have not large capitals to 
 enable them to sustain the shock. 
 
 He does not believe that political considerations enter at all into the. direc- 
 tion of this bank. He has no knowledge of a well founded complaint of any 
 mechanic, democrat or federalist, not receiving a discount, if entitled to it, 
 and the circumstances of the bank would admit of it. He stated that this was 
 no party question; that, with a very few exceptions, all classes in Philadel- 
 phia are in favor of the renewal of the charter of the bank. He is authorized 
 to say, that the person who now has, and for the last twelve months has had, 
 the largest accommodation at the bank, is one of the best known, and most 
 leading democrats in the city. If the charter be not renewed, it is his opi- 
 nion the most serious and general distress will be the consequence. 
 
 Mr. Ord, a respectable rope manufacturer, stated to the committee, that he 
 worked up annually, in his manufactory, about one hundred tons of hemp; 
 that he seldom wanted discounts; when he did, he obtained them with facility 
 from the Bank of the United States, where he had been always well treated, 
 and the business of which, he believed, had been conducted fairly and libe- 
 rally, without reference to any party or political views whatever. He had 
 hitherto been able to carry on his business with ease. He had large debts out, 
 but now all confidence was destroyed; he could collect nothing, nor could he, 
 without receiving his debts or borrowing money to meet his engagements; and 
 if times did not change, he must stop his business and dismiss his workmen, 
 as must most of the other manufacturers of cordage in the city; that at pre- 
 sent all business was at a stand; no sales could be effected. Hemp, which 
 shortly since was at $350 per ton, had fallen to $250, without finding a market. 
 He had recently bought some at $200 per ton, which had sustained so small 
 a degree of damage as to make it scarcely worth naming. Kentucky yarns 
 were also unsaleable, although there were never so many ships on the stocks 
 in Philadelphia, and the cordage for which must be principally manufactured 
 from these yarns, which, but for the present state of things, would have risen 
 rather than declined in price, as the vessels building would have been rigged 
 in the ensuing spring; that the cordage for them would have been wanted 
 nearly at the same time, and could be made much sooner from yarns than 
 from hemp, which would have given them the preference. 
 
 Mr. Ord fully concurs with the other gentlemen in the distress which would 
 be produced in consequence of a dissolution of the charter of the bank. 
 
 Mr. Peering, an intelligent and respectable currier of leather, informed the 
 committee that he was in the habit of purchasing domestic and foreign hides 
 to a large amount, which, after manufacturing, he sold to his customers in the 
 interior, and to the boot and shoe makers in me city, generally on a credit of 
 six months; which, however, frequently extended to twelve months before he 
 received his money; he also ships considerable quantities of leather to other 
 parts of the United States. There are about forty curriers in Philadelphia; 
 and from two to three thousand persons, including those who work the lea- 
 ther, are dependent on this manufactory in the city; a considerable number 
 of whom, he believes, (unless some relief is obtained) from the present scar- 
 city of money, will be greatly distressed, and be dismissed from employment. 
 He has kept his account principally with the Bank of the United States; has 
 always been well treated, and has derived a great facility in his business, 
 both to the north and south, by the bank collecting his debts for him, and 
 passing the amount to his credit in Philadelphia, free of commission and the 
 risk ot remitting money. This, he believes, is generally done by the bank for 
 the merchants, manufacturers, and mechanics, who may request it, and can- 
 not be done by the State banks, because they have not branches in the differ- 
 ent seaports of the United States, even if they had the disposition to do it. He 
 
ON 'THE BILL TO RENEW THE CHARTER OF 1791. 
 
 has hitherto been able to command, with ease, as large an amount of money 
 as his business required; at present, he cannot collect his debts nor sell his 
 stock, nor get discounts at tlie banks. Having failed to do it at the Bank of 
 the United States, he applied to a State bank, where he had made some depo- 
 sites, but without success. 
 
 Mr. Peering states, that confidence is beginning to be impaired even in bank 
 paper. He shortly since bought some hides of an opulent farmer, with whom 
 lie had dealt before, and wholiad always, without objection, received his pay- 
 ments in checks or bank bills; in the recent sale he, however, declined at 
 first to receive them; after some persuasion, he did take them, but immedi- 
 ately went to the bank and demanded the money and took it home with him. 
 Very rnanv of the manufacturers and mechanics have accounts open with the 
 Bank of the United States. He has found discounts more readily obtained 
 there than at the State banks. When he left Philadelphia he had no personal 
 knowledge of any one director of the banks. He has heard no complaints for 
 many years, of the conduct of the bank; the attkirs of which he believes to be 
 liberally and honorably conducted. He believes the only consideration with 
 them in discounting, is, whether the paper whieh is offered be good or bad, 
 without reference to political principles or conduct of the party ottering it. 
 
 Mr. Peering asserts, that, in Philadelphia, this is no party question; nearly 
 til classes wish for a continuance of the bank. He does not believe there are 
 . hundred master manufacturers and workmen in the city, who would not 
 eadily have signed the memorial, had there been time for it. The subscrip- 
 ion was very hastily filled up, or, although it contains the names of between 
 ive and six hundred master manufacturers and mechanics, and not one name 
 f any other description, it would have included a large number of others. 
 le carried round one of the memorials, and met with scarcely any one who 
 efused to sign it. He does not believe one out of a hundred would object to 
 t; it was not true that it was a party question; he was a democrat the whole 
 lelegation were democrats; some of them were from the very focus of demo- 
 cracy, the Northern Liberties; and yet they were anxious the charter of tlu- 
 jank should be renewed; indeed, if it were not, or some other relief obtain- 
 ed, a great many of the mechanics and manufacturers must stop their busi- 
 ness, dismiss their workman, and some of them be ruined, as they could now, 
 neither by loans nor by collections, get money enough to meet their engage- 
 ments and pay their expenses. The journeymen and laborers have not yet 
 felt the pressure; because they have been kept in employ from the hope that 
 business and confidence would be renewed, and money again become as 
 plenty as it had been. Should this not be the case, the clamor and distress 
 will then be heard and felt more universally and extensively. 
 
 This, sir, was the narration which was most impressively delivered to the 
 committee. In the sentiments of the delegation there was no variance; all 
 the members of it stated the anxiety and wish for the renewal of the charter 
 which pervaded nearly all ranks in the city of Philadelphia. They united in 
 the opinion that party considerations did not mingle with the question; that, 
 if the bank were permitted to run down, they would, individually, be great 
 sufferers; that a scene of embarrassment and distress would overwhelm great 
 numbers of the citizens; that the State banks could afford no relief, having 
 already extended their discounts to the utmost limits of prudence, calculating 
 on the renewal of the charter, or the forbearance of the Bank of the United 
 States; if this were not obtained, the mischiefs they have described must be 
 experienced, and the manufacturers and mechanics would fall the first sacri- 
 fices; for the merchants were in the habit, either by auction or otherwise, of 
 selling their property for endorsed paper or collateral security, while the 
 manufacturers and mechanics were left exposed on a single name, as it never 
 was their usage to demand security, nor could they do it; were they to attempt 
 it, they would give offence to their employers, and lose not only their present, 
 but all future business from them; and, of consequence, severely as the mer- 
 chants would suffer by this unexampled stoppage of business, the manufac- 
 
328 BANK OF THE UNITED STATES. 
 
 turers and mechanics would feel it still more seriously, and numbers of them 
 undoubtedly be ruined. 
 
 A delegation from the merchants of the city of Philadelphia, composed of 
 very respectable men, and equally divided as regards an attachment to the 
 two great political divisions in our country, were heard before the committee. 
 They confirmed the representations that had been made as to the conduct of 
 the bank ; the absence of party influence from its management; the interest 
 which was excited for its continuance; the stagnation of business and the 
 prostration of credit and all habits of punctuality, which they believed would 
 ensue from its dissolution. They also stated the serious loss it would occa- 
 sion to the Government from the inability of the importers to pay their bonds, 
 and their disbelief in the ability of the State banks to afford any permanent relief. 
 These gentlemen gave it as their opinion that the more liberal these banks 
 were now, the worse would be their situation when the Bank of the United 
 States ceased its discounts; that if the affairs of that bank were speedily wound 
 up, the State banks could not meet their engagements and pay for the notes 
 they had in circulation, and that they must, of course, stop payment as well 
 as the merchants; that, in such a state of things, the depositors would with- 
 draw their deposites instantly, and the bank notes which were in circulation 
 would immediately return upon the banks, when they would be unable to pay 
 them; that, already a considerable degree of suspicion was beginning to pre- 
 vail of the security of bank paper; that there had been recently brought to the 
 Bank of North America notes which had been issued twenty years before, and 
 \yere supposed to have been lost, but which distrust had again brought to 
 light; that neither navigation, nor merchandise, nor exchange, however un- 
 exceptionable, could now be disposed of, except at great sacrifices; that flour 
 had fallen in price from eleven to seven and three-quarters of a dollar, or 
 eight dollars per barrel; that the house to which one of the gentlemen belong- 
 ed, one of the first in point of standing in the United States, had recently re- 
 ceived orders for the shipment of 30,000 barrels of flour, \yhich, from the un- 
 certainty of finding funds or procuring purchasers for bills of exchange, as 
 heretofore, lucrative as was the commission, they had declined to execute. 
 That it was the belief of these gentlemen, that the dissolution of the bank, and 
 the collection of its capital at so unfortunate a period as the present, when so 
 much property was otherwise absorbed and sequestered abroad, would be at- 
 tended with extremely injurious consequences to the commercial, agricultu- 
 ral, and manufacturing interests, and to the revenue and prosperity of the 
 country. 
 
 Sir,l shall neither trespass further upon your time, nor weaken this testimony 
 by any comments of mine. I havenovy only to ask the indulgence of the Senate 
 while I trouble them with a few additional observations, and those chiefly of 
 a personal nature. Most certainly, sir, I am not acting under the bias of 
 any sinister influence or partiality in advocating the renewal of the charter of 
 this bank. I do not own a share of the stock, nor have I owned one for a 
 considerable time past, nor do T owe to the institution a dollar. A few years 
 since, I was in the direction of one of its branches the bank in Boston and 
 I was left out of it with very little ceremony: not because I had abused the 
 confidence reposed in me, for at the time I was left out of the direction I did 
 not owe to the bank a single cent, either on my own account, or as surety for 
 another, and my accommodation at the bank had never been large. I was then 
 young, and possessed of but little properly, and to enable me to exercise an 
 independence of action, which I hope ever to preserve, I thought it proper to 
 abstain in a considerable degree from accommodations to myself, in order 
 that I might be enabled, if necessary, more freely to check undue accommoda- 
 tions to others. Still, sir, this was a conduct towards me not calculated to 
 produce any peculiar partiality for the institution. It is true I was subsequently 
 offered, from a source which I respected, a seat again at the Board of Direc- 
 tors, with the understanding that 1 should retain it as long as I pleased. 
 
 This I declined, and should ever have declined it. Although from these 
 circumstances it cannot be expected that I should feel any particular regard 
 
ON THE BILL TO REN ? EW THE CHARTER OF 1791. 
 
 for the bank, yet still 1 am bound to say I feel no hostility towards it. I 
 believe it has been an extremely useful institution; and, from a personal 
 knowledge of the management of the affairs of the branch bank at Boston, I 
 freely declare, that, in my opinion, it is impossible for the concerns of any 
 moneyed institution to be conducted with more correctness, integrity, and im- 
 partiality; with more discretion towards the public, or greater safety towards 
 the corporation which created it. I knoyv the directors. They are honorable 
 and estimable men; and at the head of the bank is a gentleman, an Essex 
 junto man, perhaps, he may be called, who would grace any station in any 
 country , 
 
 Sir, I have received from the most numerous branch of the Legislature of 
 Massachusetts, a request that I would oppose the renewal of the charter of 
 this bank. I receive the- request, sir, with all the deference and respect 
 which is due from me to an expression of the opinion of that honorable body. 
 It has induced me to examine my sentiments, t9 re weigh, and deliberately re- 
 flect upon them. Having done this, and having come into office without an 
 intimation of a wish on my part for public life, without a single stipulation as to 
 my political opinions, or an indication of the course I should pursue, I can only 
 say ? I should not act, on a question in which I considered the public interests 
 as implicated, in opposition to the convictions of my own mind, deliberately 
 formed, in consequence of the request, or, if you please, instruction, of the en- 
 tire Legislature of the State which I have in part the honor to represent, 
 much as I am bound, both by duty and inclination, to respect it, nor in conse- 
 quence of the request or instruction of all the congregated legislatures on 
 earth. I believe the renewal of the charter of the bank will avert many evils, 
 and I shall vote for it. 
 
 It will probably be said, sir, that the distresses which will be incident on 
 the dissolution ol the bank, have been greatly exaggerated; that a city in this 
 vicinity is ready to meet the consequences, and to set them at defiance. Let 
 it be recollected, that, in the five New England States, a country for which it 
 is both my pride and pleasure to avow a marked partiality, we have but one 
 branch of the Bank of the United States, and that with a capital of only 
 700,000 dollars. Surely, then, if a single city, with a population of thirty or 
 forty thousand persons, can meet these consequences, we can sustain them; 
 but we shall undoubtedly suffer much inconvenience, not, however, so great a 
 degree of it as any other district on the seaboard of the United States. 
 
 It is possible, sir, that apprehension may have magnified the evils which are 
 to flow from the dissolution of the bank; it is possible, in this untried state of 
 things, there may be found a power of expansion in the moneyed market of the 
 country, which will be equal, or nearly equal, to the unexpected demand that 
 may be made upon it. Should this be the result, I should be extremely gra- 
 tified to have been mistaken. I should rejoice in my own disappointment. 
 
 FEBRUARY 14, 1811. 
 Same motion. > 
 
 Mr. GILES spoke at great length in favor of the motion. 
 
 Mr. GILES. Mr, President: It is with great reluctance that I find myself 
 compelled to enter into the discussion of the subject now under the considera- 
 tion of the Senate; but the observations which fell from the honorable gentle- 
 man from Georgia, (Mr. CRAWFORD) were of such a character as to impose on 
 me an irresistible obligation to present that view of the subject which has re- 
 sulted from the best reflections I have been enabled to bestow on it. This obli- 
 gation arises from the very high respect I entertain for the Legislature of the 
 State I have the honor to represent the great respect I feel for the gentleman 
 who made the observations, as well as from the respect which is manifestly 
 due to myself. In executing this unpleasent task, I labor under circumstances 
 of peculiar embarrassment This embarrassment arises from a conviction, that 
 the views of the subject now proposed to be exhibited will disappoint the 
 42 
 
33Q BANK OF THE UNITED STATES. 
 
 expectations both of the opposers and the favorers of the bill; and that they will 
 not be acceptable to either. I shall not, however, ii> this instance, depart 
 from my invariable habit, when urged by duty to participate in debate before 
 this honorable body, of disclosing, in the most undisguised manner, my real 
 opinions upon the whole subject, from any consideration of political difficulties 
 or inconveniences which may consequentially affect myself. 
 
 In the first place, I find myself called upon to oppose a law on constitutional 
 grounds, which has been in existence for nearly twenty years; and, during 
 that period, I am compelled to admit, has been acquiesced in by the several 
 State Governments, as well as by the General Government, and its republican 
 administrations. It is peculiarly irksome to me to question the constitutionality 
 of a law which has been thus and so long acquiesced in, because it tends to 
 give the character of instability to the laws generally; and in my judgment,, 
 tends also, in some degree, to impair the sacred character of the laws, and of 
 course, to lessen their efficacy. In a government like ours, where the laudable 
 boast of every citizen is, that he lives under a, government of laws, and not of 
 men, no subject should be touched with more caution and delicacy than 
 one which questions the validity of the laws, lessens the confidence of the 
 citizens in them y or impairs the obligation of obedience to them. Yet. sir y 
 the course of observations I propose to make, may have some of these ten- 
 dencies, which I should extremely regret, and this apprehension, of course, 
 produces embarrassment. Connected with this idea, is another circumstance 
 of embarrassment. I cannot help observing the inordinate zeal manifested by 
 the opposers of this bill, evidently resulting from a belief that its rejection 
 will lessen the powers of the Federal Government. Although it may be pro- 
 perty directed in the present instance, yet, I think [ have seen, and fear I 
 may hereafter see, the same spirit directed against some of the powers and 
 proceedings of the Government, which I have deemed indispensable to its own 
 preservation and its beneficial efficacy toward the People. It may, perhaps, 
 be thought, by some, not becoming in me to say, that I have not been an inat- 
 tentive observer of the progress of this Government for twenty years; and 
 more particularly, since the republican party came into power. Some of the 
 scenes through which I have passed, have produced an impressive influence on 
 my mind. Such is the nature of the Government, that its administration will 
 vibrate from one principle to another, and it will always require great wisdom 
 to keep its oscillations from wandering too far. Whilst those who preceded 
 us in power, endeavored to legislate into the constitution an unnecessary con- 
 structive energy, leading to what has been called consolidation, it appears to 
 me that we have taken too much the opposite course, leading to disunion and 
 dissolution, by depriving it constructively of its legitimate, necessary, and pro- 
 per powers. If this course should be unfortunately persevered in, it requires 
 no spirit of prophecy to foresee, that the Government will fall to pieces from 
 the want of due energy in the administration of its legitimate powers; or that 
 some extraordinary means must be resorted to for its resuscitation. When 
 we cast our eyes abroad, and see the aggressions committed on our rights by 
 all the belligerents, &c.; when we reflect that we cannot calculate upon a per- 
 petual exemption from wars and other political calamities, the common lot of 
 all nations; when we look at home, and see the State Governments interfering 
 with and controlling the proceedings of the General Government, even in rela- 
 tion to measures directed towards these aggressing belligerents; when we look 
 around us at home, and see every where me inveterate struggles amongst poli- 
 tical partizans for political power; when we recollect the number of choice 
 spirits amongst us, not content with the dull pursuits of civil life; when we 
 look at out extensive defenceless frontier, almost without limits, and see, al- 
 most every year, ambitious enterprising individuals, with hostile arms in their 
 hands, raised in defiance of the authority of the United States, &c. &c., it 
 appears to me wonderful that gentlemen should be delighted with curtailing 
 the constitutional powers of the Government, and enfeebling its necessary en- 
 ergies. It is the more wonderful, when we see the same gentlemen, who seem 
 to consider every curtailment of power as an individual triumph to themselves, 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 the most clamorous against the Government for not taking a manly attitude in 
 repelling foreign aggressions, &c. &c. It appears to me, sir, we often see 
 the same gentlemen, with the best and most patriotic intentions, indulging in 
 these irreconcileable opinions. This is not the first time I have endeavored, 
 in a solemn and impressive manner, to present this subject to the view of the 
 party now in power. Hitherto my efforts have been unavailing. 
 
 Let me now indulge a hope, that these reflections will meet with due con- 
 sideration from those now entrusted, by the People, with the management of 
 their dearest interests. If inducements to these observations were called for, 
 sunily sufficient could be found during the republican administrations. I 
 need only call your attention, sir, to the lessons afforded in the inefficacy of 
 pur measures to repel foreign aggressions, to assert our rights, and do ourselves 
 justice, &c. and the causes which have led to this inactivity and feebleness of 
 the Government. They will not be found in any defect of powers in the con- 
 stitution, because, in that respect, they are unlimited; it is because gentlemen, 
 from various weak and groundless alarms and apprehensions, have been un- 
 willing to exert the legitimate energies of the constitution for those great 
 objects. They have theorised and criticized themselves into such fears of the 
 undue exercise of power, that they will not duly exercise it when indispen- 
 sably necessary to the national character and interests. It is not my wish to 
 extend the powers of the constitution beyond the fair and candid interpreta- 
 tion of its meaning; because, that, in my judgment, it will be sufficient for all 
 saltuary purposes. I only regret the unwillingness of gentlemen to act up to 
 that point, and the probable consequences resulting from that indisposition. 
 1 have also to unite with the gentleman from Georgia (Mr. CRAWFORD) in 
 expivs>ing my regret, that, in discussing this subject, both within and without 
 the walls of Congress, and particularly in various republican news- 
 papers, an unwise spirit and zeal should have been manifested, which, being 
 more repulsive than persuasive, have, I verily believe, tended to defeat their 
 own object, and to put at hazard the rejection of the bill. Why, on this sub- 
 ject particularly, should we witness such a display of intolerance and denun- 
 ciation? Why the illiberal ascription of impropi.'r motives to the republican 
 members who support the bill? Can any good result to the nation, to the re- 
 publican party, or to the favored side of the question, by this course of con- 
 duct? May it not produce an injurious influence on all? The subject cer- 
 tainly presents fair grounds for a difference of opinion amongst individuals, 
 and even amongst republicans, without searching for the causes of this differ- 
 ence in corrupt motives. Why, then, upon this particular occasion, should 
 the free exercise of opinion be hunted down by a spirit of intolerance or de- 
 nunciation? It was this spirit which, more than any other cause, blasted the 
 hopesjof the republican principle in France, and, if indulged in to excess, will 
 destroy it in any other country upon earth. In the due administration of a 
 republican government, truth and right alone ought to be sought after, and they 
 can only be found by leaving the mind to free investigation; by guarantying 
 to all its faculties, the most perfect exemption from all terror and alarm. I 
 hesitate not to say, that, in my judgment, this spirit, if indulged in, will be- 
 come more dangerous to the due administration of this Government, more 
 deleterious to its proceedings, than the adoption of any one single measure, 
 however unwise or impolitic even than the renewal of the charter of the 
 Bank of the United States for twenty years which now seems to be the cause 
 or the pretext for exciting and stimulating this unfortunate spirit. 1 am ready 
 to admit, too, that I have never seen this spirit displayed with more positive 
 assertion and bold denunciation upon any question than upon the present. 
 This circumstance induced the gentleman from Georgia (Mr. CRAWFORD) to 
 indulge himself in severe and most sensitive invectives upon this topic; and, 
 in my judgment, not without cause. But it would have afforded me great 
 pleasure, if the gentleman could have prevailed on himself to have viewed 
 these proceedings "in the calm light of mild philosophy,-' and not to have 
 presented to the Senate an example in himself, in appearance at least, of the 
 passions and prejudices he so justly reprehended in others. I think I do not 
 
532 BANK OF THE UNITED STATES. 
 
 mistake myself, Mr. President, when I profess to enjoy the most entire ex- 
 emption from this baneful spirit of intolerance; when I profess to feel the 
 greatest respeet for the gentlemen who differ from me on this occasion; anil 
 lor their motives, when I profess to extend all possible indulgence and for- 
 bearance towards the opinions of those gentlemen, and feel, at the same 
 time, conscious, that I shall stand in need of the same liberality myself, from 
 both sides of the question. Indeed, sir, I would not deign to accept a vic- 
 tory in argument, founded solely upon the ascription of improper motives to 
 my antagonist. It is my intention to give the arguments of the genlemen on 
 the other side of the question the most impartial and attentive consideration. 
 I know the gentlemen are personally 'entitled to it, and their observations- 
 merit it. 
 
 The honorable gentleman from Georgia, (Mr, CRAWFORD) who reported 
 this bill, as the chairman of the committee to whom the subject was general- 
 ly referred, excited not a little surprise in my mind, by the prefatory remarks 
 which fell from him in support of it. The gentleman prefaced his- arguments 
 by observing, that " it had latterly become the fashion to eulogise the constitu- 
 tion of the United States; and that, whenever he heard lavish encomiums ap- 
 plied to it, he could not help apprehending mischief." I acknowledge I 
 could not comprehend the bearing of this remark upon the question under 
 discussion. I, sir, have long been in the habit of venerating the constitution* 
 and have often expressed my admiration at the wisdom of its provisions; ana 
 I really had hoped that I might have been indulged in these sentiments and 
 prepossessions, and even the expression of them, upon proper occasions, with- 
 out exciting in the mind of any gentleman apprehensions of mischief; nor 
 can I divine what species of mischief the gentleman apprehends from that 
 cause. Mr. President, when we look over the whole world known to us; 
 when we particularly cast our eyes over that part of it with which we have 
 the most intimate relations; when we see the rapid strides which despotism 
 is making over the whole human race; when we observe the various and pow- 
 erful means now in use, to rivet its immov cable dominion upon mankind f 
 when we reflect that the constitution of the United States now affords the 
 only practical experiment upon the republican principle, and the only and last 
 hope for the preservation and extension of the liberties of man; is it wonder- 
 ful or alarming that we should feel and express some partiality, and even 
 veneration, for an instrument of so peculiar a character, or should even en- 
 deavor to teach others to venerate, to cherish, to support it? an instrument, 
 whose provisions at least exempt us from the general scene of despotism, and 
 may eventually extend their blessings to the whole human race. Or, if, in 
 dwelling upon the wisdom and importance of its provisions, we might pass 
 over some possible defects, without scrutinizing them with an hypercritical 
 eye, might not the omission be indulged without producing animadversion or 
 censurer Sir, we all venerate the republican principle. I know the gentle- 
 man from Georgia (Mr. CRAWFORD) does; nor do I pretend that my devotion 
 to it is greater than his; but, sir, I have given the greatest attention to the ob- 
 servations of the gentleman upon the constitution, and I can novy say, that my 
 veneration for the instrument, and admiration at the wisdom of its provisions, 
 are not at all impaired, nor diminished, notwithstanding the gentleman's criti 
 cisms,&c. I will now, Mr. President, endeavor to exhibit the general cha- 
 racter of the constitution; to point out the mode for its correct interpretation; 
 and apply it to the subject now under consideration. In doing so, I propose to 
 follow the course of observations made by the honorable chairman of the com- 
 mittee who reported the bill. 
 
 The gentleman proceeded to remark, that, in taking a review of the consti- 
 tution, he found general as well as incidental powers enumerated therein. I 
 did not see the precise application the gentleman intended to make of this re- 
 mark, but I have been induced to review the constitution in reference to this 
 subject, and it does appear to me, that the classification and definition of 
 powers is as well arranged as human wisdom could devise. I know that 
 nothing is perfect, which is the work of man; that no language is capable of 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 333 
 
 perfect definition. But, as far as definition can be drawn from language, I 
 conceive the constitution exhibits as perfect an example as is in existence. In 
 the next place, the gentleman remarked, that there was a number of cases in 
 which Congress had departed from the particular enumerated powers in the 
 constitution, and had resorted to implication, or construction, for the deriva- 
 tion of its powers. The remark is perfectly correct, and I am very ready to ad- 
 mit that there is no such thing as carrying into eftect enumerated pmvers,inany 
 instrument whatever, without the intervention ot certain derivative and im- 
 plied powers. But, if the gentleman had succeeded in showing that there had 
 been aberrations by the Congress of the United States, from the enumerated 
 powers of the constitution would he think it correct to use those aberra- 
 tions as precedents for still further aberrations? Ought they not rather to be 
 considered as mementoes on the part of Congress, to induce them to tread 
 with more care, and, if they find that their former errors could not be supported 
 by a fair and candid construction of the constitution, to restrain the laws with- 
 in its wholesome provisions? Certainly, that is the use to which the history 
 of errors, presented by the gentleman from Georgia, ought to be applied. But, 
 before I proceed to examine the subject with more accuracy, I cannot avoid 
 expressing my surprise at another observation which fell from the gentleman. 
 The gentleman observed, that the argument drawn from the distinction be- 
 tween ends and means was " incomprehensible;" and he went so far as to call 
 it " nonsensical jargon." It is not only comprehensible to me, sir, as I con- 
 ceive, but, in my opinion, is the only way in which a just construction of the 
 constitution is to be attained. This results from the peculiar nature and or- 
 ganization of the instrument. Permit me here to endeavor to illustrate my 
 idea by a reference to the constitution itself. The constitution is an instru- 
 ment which grew out of the situation of the United States, at the time of, and 
 preceding its adoption; and, to show that the constitution recited the great 
 objects ot its formation, and then prescribed the means for carrying them into 
 eftect, I beg leave to refer to a part of the instrument itself. The preamble, 
 like all other preambles, was designed to express the objects of theinstrument. 
 or the ends to be effected by its provisions. "We, the People of the United 
 States, in order to form a more perfect union, establish justice, ensure domes- 
 tic tranquillity, provide for the common defence, promote the general welfare, 
 and secure the blessings of liberty to ourselves and our posterity, do ordain 
 and establish this constitution for the United States of America." What is 
 the plain language of this preamble? The answer is obvious. That certain 
 great ends, or objects, are here proposed to be effected. In what mode, or by 
 what means, are they to be effected? The preamble tells you, sir, " by esta- 
 blishing this constitution, for the United States of America." That is the mode 
 in which these great ends are proposed to be effected; and the body of the in- 
 strument prescribes the means, which were deemed necessary and proper to 
 the effectuation of these ends. This subject will be better understood by 
 throwing the mind back to the period of time when this constitution origi- 
 nated, and reviewing the peculiar political situation of the United States then, 
 and for sometime antecedently thereto. 
 
 At the time, and antecedently to the establishment of the present constitu- 
 tion, the existing State Governments were in possession of all the powers of 
 sovereignty, subject only to feeble and inefficient articles of confederation, 
 without the means of executing their own will; and resting for its execution 
 solely on requisitions upon the respective States, which might either comply 
 or refuse to comply with such requisitions, at their discretion. A non-com- 
 
 Eliance was almost invariably the result of State deliberations; and hence the 
 jebleness of the old confederation. The present constitution was adopted as 
 the remedy for this great and alarming evil. Without it, disunion and ruin to 
 the States would have been the inevitable consequences; because, upon actual 
 experiment, the States were found utterly incompatent to the due administra- 
 tion ot all the powers of sovereignty entrusted to their management. The 
 reason of this incompetency was, that some of the most important powers of 
 sovereignty inherently possessed a geographical influence beyond the geogra- 
 
334 BANK OF THE UNITED STATES. 
 
 phical limits of the several States, individually; and their jurisdiction could not 
 transcend their geographical limits. Of this description of powers is the pow- 
 er to declare war, &c. to regulate commerce, &c. &c. and all the other enu- 
 merated powers of the constitution. In consequence of the conflicting sys- 
 tems adopted by the several States in relation to some of these powers, which 
 were then in practical operation, particularly in the conflicting regulations of 
 commerce, the States were getting into the most serious collisions, &c. &c. 
 The formidable evils necessarily growing out of this state of things required a 
 formidable and competent remedy. The great subject for the contemplation 
 of every reflecting mind in America was, what that remedy should be? 
 
 The wise framers of our admirable constitution, after great deliberation, 
 conceived and executed the only practicable expedient. It consisted in se- 
 parating the powers of sovereignty; in establishing a GeneraljGovernment, and 
 conferring on it all the powers of sovereignty, whose geographical influence 
 was found co-extensive with the geographical limits of the United States, and 
 reserving to the State Governments, respectively, those powers which were of 
 a more local character, and which possessed no influence beyond the limits of 
 the States, respectively. And also to confer on the General Government " all 
 the means necessary and proper" for executing its own laws in relation to 
 these enumerated powers, without any dependence upon requisitions from the 
 respective State Governments for this indispensable object. The idea was a 
 grand one, and executed with an admirable simplicity, and the most consum- 
 mate wisdom. Hence it appears, that the great object of the framers of the 
 constitution was, to establish a general or federal government, and to confer 
 on it all the powers of sovereignty, which, in their nature and character, pos- 
 sessed an influence co-extensive with the United States; and to reserve to 
 the previously existing State Governments, all the powers of sovereignty of a 
 more local character, and whose influence did not extend beyond the geo- 
 graphical limits of the States, respectively, and therefore could be rendered 
 completely subservient to State jurisdiction and management. These are the 
 means prescribed in the constitution, for effecting the ends expressed in the 
 preamble. To the administrators of the General Government, the framers of 
 the constitution have said, We give to you all the powers of sovereignty of 
 general character; and to the administrators of the State Governments, they 
 have said, We reserve to you all the powers of sovereignty of a local charac- 
 ter. I verily believe, that, if those various governments should be administer- 
 ed with the wisdom with which this separation of powers was made in the 
 body of the constitution, the People of the United States will not be disap- 
 pointed in the great and interesting objects proclaimed in its preamble. But 
 1 cannot help expressing some apprehensions, that, from an incorrect under- 
 standing of the constitution; from an unwise spirit of jealousy; a disposition to 
 strip the Government of its necessary and proper energies, &c. &c. the ad- 
 ministrators of the Government may not only disappoint the just expectations 
 of the People in this respect, but may lead to incalculable political mischiefs 
 and disasters. This arrangement was, in my judgment, indispensable to the 
 preservation of the republican principle, and all-important to the dearest in- 
 terests of the People of the United States. As far as the practical experiment 
 has been carried, it lias been attended with the happiest effects. I still hope 
 for the best in its future operations; but I also hope I shall be pardoned for 
 expressing some fears, arising from various manifestations of imbecility in 
 measures relating to our internal as well as external concerns. From this 
 short history of the origin of the constitution, and the causes which produced 
 it, it evidently appears that the General or Federal Government is, in its na- 
 ture and character, a government of enumerated powers, taken from previous- 
 ly existing State Governments, enumerated, and conferred on it, reserving 
 all unenumcratetl powers to the State Governments, or to the People in their 
 individual capacities. But if any doubts had existed upon this subject, two 
 amendments to the constitution, growing out of some jealousies lest a contrary 
 interpretation should be given to the constitution, have been adopted, which 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 335 
 
 ought to put this question to rest for ever. The 9th and 10th articles of 
 amendments to the constitution are as follow: 
 
 ' The enumeration, in the constitution, of certain rights, shall not be constru- 
 ed to deny or disparage other?, retained by the People." " The powers not de- 
 legated to the United States by the constitution, nor prohibited by it to the 
 States, are reserved to the States, respectively, or to the People-" 
 
 Now, sir, can language be more explicit than this, in declaring that this 
 charter contains certain enumerated powers, and that all not enumerated are 
 reserved to the States or to the People? There is one article reserving rights 
 to the People, and afterwards another article reserving them to the States and 
 to the People. 
 
 While on this subject, I beg leave to read a clause in the constitution, which 
 1 find among the enumerated powers, and which has been construed by some, 
 as intended to convey a general grant of powers amongst the enumerated 
 powers: " Congress shall have power to lay und collect taxes, duties, imposts, 
 and excises, to pay the debts, and provide for the common defence and general 
 welfare of the United States." The words, " and to provide for the common 
 defence and general welfare," have, by some, been considered as conveying 
 a general grant of power. Nothing is necessary to show that this is not a fair 
 and correct construction of tin 1 constitution, but reading it with attention. 
 These terms contain no grant of power whatever, but are used to express the 
 ends or objects for which particular grants of power were given. Paying the 
 debts, and providing for the common defence and general welfare, are great 
 objects, intimately connected with the particular grants of power which are 
 given for their cttectuation. And, without these particular grants of power, 
 it would not have been possible for Congress to effect them. The framers of 
 the constitution have simply selected some of the objects expressed in the pre- 
 amble, and declared, that, to elt'ect them, and to pay the debts of the United 
 States, were the considerations which induced thfm to uive to Congress the 
 " p:nver to lay and collect taxes," &.c. Thu-. taxes are to be laid, &c. " to 
 pay the debts, and to provide for the common defence and ^em-raj welfare." 
 Could they have chosen a more appropriate phraseology? The plain language, 
 to Congress is, " You shall have power to lay and collect taxes, to pay the 
 debts," &c., and to proude for the common defence and general welfare, or, 
 in other words, for the purpose of paying the debts, 6cc. and of providing for 
 the common defence and general welfare. Thee words do not contain a 
 general grant of powers, Inn rxpnws theobjectsof a particular grant of powers. 
 The framers of the constitution could not have done an act so absurd, as to 
 make a general srant of powers amount an enumeration of specified powers. 
 
 I will now, Mr. President, proceed to examine those instances which the 
 gentleman has presented, of the supposed aberrations of the Congress of the 
 United States from the enumerated powers: and I think it vyill not be diffi- 
 cult to show that there is not a single instance quoted, but which is cleducible 
 from a fair and correct interpretation ot the express words of the constitution, 
 giving them their common and appropriate meaning. 
 
 The first instance presented to our consideration by the honorable gentle- 
 man from Georgia, (Mr. CRAWFORD) of the exercise of a power by Congress, 
 not enumerated in the constitution, was the erection ot light houses. The 
 gentleman from Massachusetts, (Mr. LLOYD) to whose dispassionate observa- 
 tions I listened with great pleasure, superadded the instance of the erection of 
 customhouses. On these, both of the gentlemen seemed to place great re- 
 liance, as cases in point with the one under consideration. Both thes'e powers 
 I conceive are given to Congress by the express words of the constitution; but 
 if I should be mistaken in this idea, they are certainly comprehended as inci- 
 dental and subservient to. or, in other words, " necessary and proper" for, car- 
 rying into effect some of the enumerated powers. 
 
 The express words of the constitution give to Congress the power " to lay 
 and collect taxes, duties, imposts, and excises," &c. &c. " To regulate com- 
 merce ^with foreign nations, amongst the several States, and with the Indian 
 tribes;" t4 to exercise exclusive legislation in all cases whatever, &c. over 
 
336 BANK OF THE UNITED STATES. 
 
 all places purchased by consent of the Legislature of the State in which the 
 same shall be, for the erection of forts, magazines, arsenals, dock yards, and 
 other neecjful buildings." From these clauses of the constitution, taken in 
 connexion with each other, I think Congress possesses the po\yer to erect 
 light houses and custom houses by the express words of the constitution: for 
 both of the&e descriptions of houses must necessarily be included within the 
 term, " needful buildings;" or, the only construction which is at all applica- 
 ble to these cases, is. that needful buildings is the general term, and li^ht 
 houses and custom nouses are particular instances, or examples, under the 
 general term: or, if I may be so allowed to express my ideas, needful build- 
 ings may be considered as the genus, of which light houses and custom houses 
 are particular species. The reason, with the framers of the constitution, for 
 using this general term, is obvious: It was, because it was impossible for 
 them to foresee all the particular species of needful buildings which might 
 become necessary to the salutary operations of this Government, in the course 
 of its complicated and due administration; they, therefore, wisely left that 
 subject to the discretion of Congress, restrained and limited, nevertheless, by 
 the requisition of the consent of the Legislatures of the States, respectively, 
 in every case proposed for the exercise of this discretion. That this is a plain 
 and correct interpretation of the constitution, is evinced by the concurrent 
 opinions of every Legislature of every State which has heretofore ceded lands 
 for any of these objects; and it is to be remarked, that Congress has never 
 attempted to erect any of these buildings without the constitutional requisi- 
 tion of the consent of the States, respectively. But if this term, " needful 
 buildings," had not been expressed in the constitution, I should not hesitate 
 to admit, with these gentlemen, that the erection of light houses and custom 
 houses might properly be deduced from the power to lay and collect taxes, 
 duties, &c. &c., and from the power to regulate commerce. &c. which are 
 particular grants of power enumerated in the constitution. Because custom 
 nouses are appropriately necessary to the collection of duties^ and have al- 
 ways been deemed indispensable ior that object, as are light houses to the due 
 regulation of commerce. 
 
 These two powers are indispensably connected with, and subservient to, 
 particular enumerated powers, and are, therefore, amongst the means which 
 are necessary and proper for their effectuation; and as such, are given to Con- 
 gress by the express words of the constitution; which are, Congress shall have 
 power * 4 to make all laws which shall be necessary and proper for carrying into 
 execution the foregoing powers, and all other powers vested by this constitu- 
 tion in the Government of the United States, or in any department or officer 
 thereof." From this course of interpretation, the gentlemen, reasoning from 
 a supposed analogy, have asked, if Congress can derive the right to erect light 
 houses and custom nouses from their necessary agency in effectuating the par- 
 ticular powers to which they are said to be appendant, or appurtenant, why 
 may it not, in the same way, derive the right of granting charters of incorpo- 
 ration for the same objects? Or, in other words, if Congress can constitution- 
 ally erect custom houses for the purpose, or as the necessary means, of col- 
 lecting duties, why may it not establish a bank for the same object? &c- The 
 question is admitted to be a fair one; and if a clear distinction cannot be made 
 in the two cases, it will be admitted, either that Congress may constitutionally 
 establish a bank, or, that it has heretofore transcended its powers, in erecting 
 custom houses, &c. A clear and most obvious distinction appears to me to 
 exist in the cases suggested by the gentlemen to be analogous, arising from the 
 striking difference in the nature and essential character of these powers. A 
 custom house is, in its nature, incidental and subservient to the collection of 
 duties. It is one of the common, necessary, and proper means to affect that 
 end. It is believed that, in no commercial country in the world, are duties 
 collected without them. Besides, the erection of custom houses does not in- 
 volve in it the exercise of any other higher or consequential powers. The 
 same remarks will apply to light houses, as amongst the common, necessary, 
 and proper means for the regulation of commerce, &c. 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 337 
 
 Is the incorporation of a bank of this character? It is not amongst the com- 
 mon, necessary, and proper means of effecting either of the foregoing enume- 
 rated powers, nor of any other enumerated in the constitution; still less is it 
 incidental or subservient to any of the enumerated powers. It wants that con- 
 nexion, affiliation, and subserviency, to some enumerated power, which are 
 clearly pointed out in relation to the two powers to which it has been said to 
 be analogous. Besides, does granting a charter of incorporation to a bank in- 
 volve no other higher or consequential power, than merely erecting a needful 
 building for collecting duties? &c. It certainly does. It involves the power 
 to grant charters of incorporation generally; and in this respect, principally, 
 its character is essentially different from both of the powers cited by the gen- 
 tleman. The power to grant charters of incorporation is not an incidental, 
 subordinate, subservient power; it is a distinct, original, substantive power. 
 It is, also, susceptible of the clearest definition; and not being amongst the 
 enumerated powers, it seems to me that Congress can have no fair claim to 
 its exercise in any case. If Congress had been expressly authorized to grant 
 charters of incorporation generally, then, granting a charter of incorporation 
 to a bank would have been an instance, or amongst the means, of carrying into 
 effect that enumerated power; and would have been as much connected and 
 affiliated with it, as is tne erection of custom houses with the collection of du- 
 ties; but the power to grant charters of incorporation generally', not being ex- 
 pressly given in the constitution, no particular instance involving the exercise 
 of that power can be inferred, by a fair and candid interpretation of the in- 
 strument. I do not mean to exaggerate the consequences which might result 
 from an assumption of the power to grant charters of incorporation, &c. It is 
 sufficient for me to say, that it is a power of primary importance; that it in- 
 volves as many incidental powers in its exercise, as anyone of the enumerated 
 powers; that it is equal, ii* not paramount, to any; and therefore, in my judg- 
 ment, cannot be assumed, by fair construction, as incidental and subservient 
 to any; and, of couse, not as amongst the necessary and proper means for car- 
 rying any into effect. In fact, in its nature, it does not, in the smallest degree, 
 partake of the derivative, incidental character. It is original, substantive, 
 distinct in itself, and susceptible of the plainest definition. Hence, whilst I 
 am willing to admit that a power, which is, in its nature, incidental and sub- 
 servient to any enumerated power, and also amongst the necessary and proper 
 means for carrying it into effect, may be exercised by Congress without the 
 express words of the constitution, I should be very unwilling to admit that 
 Congress should also exercise a power neither incidental or subservient tr) any 
 of the enumerated powers, nor amongst the necessary and proper means for 
 carrying any into effect: still less should I be inclined to this admission, when 
 the power thus proposed to be derived, incidentally or constructively, involves 
 in it the exercise of almost unlimited powers. To illustrate my idea still fur- 
 ther, in this respect, I would observe, that the power to regulate descents, 
 and to regulate the distribution of intestates. I conceive to be original, distinct, 
 substantive powers; and, being amongst the powers, \vhich could in all re- 
 spects be limited by the geographical boundaries of the individual States, and 
 were, therefore, amongst the powers reserved to the management of the States, 
 might as easily be assumed by Congress as incidental to some one of the enu- 
 merated powers, as the assumption of the power to grant charters of incorpo- 
 ration, which I conceive was, for the same reason, left to the management of 
 the States. I believe no gentleman will contend that Congress can, under 
 any caudid construction, go so far in relation to those powers; nor do I see 
 how it can in relation to the power of granting charters of incorporation. 
 
 I have not overlooked the observation, sir, made by gentlemen to destroy 
 the effect of this course of reasoning, to wit: that the passing every law is an 
 act of sovereignty; that to pass a law to erect a light house, is as much an act 
 of sovereignty, as to pass a law to lay and collect a tax, &c. or to grant a char- 
 ter to a bank, &c. In fact, that there are no degrees of sovereignty. Without 
 entering into this reasoning, it will be sufficient to show its inapplicability to 
 my argument, to observe, that I have not grounded my distinctions upon any 
 43 
 
338 BANK OF THE UNITED STATES. 
 
 suggested difference in the degrees of sovereignty; but upon- the clear and ob- 
 vious difference in the nature and character of the powers upon which this* 
 sovereignty, c. is intended to operate, &c. 
 
 The gentleman from Georgia (Mr. CRAWFORD) observed, that the clause in 
 the constitution, last read, "Congress shall have power to pass all laws which 
 shall be necessary and proper," &c. had been considered by some, as entirely 
 inoperative; but that bethought it a clause of great importance, &c. In this 
 opinion, I entirely concur with the gentleman; I consider it the most import- 
 ant clause in the constitution. It is, in my judgment, the true key for unlock- 
 ing the meaning of all the other clauses. The former confederation did not 
 possess the means necessary and proper for carrying into execution its own 
 powers. It was dependent upon the State Legislatures for that purpose; and it 
 was too important a difference in the organization of the present and former 
 Government, to be left to construction. It was therefore expressed, to declare 
 the true character of the present Government; and to proclaim^ ts sovereignty 
 upon all the subjects of the enumerated powers. But, sir,, the most important 
 bearing of this clause appears to me to be the designation of the department 
 which should be the ultimate depository of all the power vested in the Govern- 
 ment by the constitution. Thus* Congress is declared not only to have power 
 to pass all laws which shall be necessary and proper for carrying into execu- 
 tion the powers particularly confided to its management, but " all other pow- 
 ers vested by this constitution in the Government of the United States, or in 
 any department or officer thereof." This clause, I think, intended to settle 
 all differences between the departments respecting the ultimate deposite of 
 power, in which light it has been hitherto too little regarded. None of these 
 considerations, however, can vary in the smallest degree the results I have 
 attempted to draw against the power of Congress to resort to unenumerated* 
 original, substantive power, general in its character and operation,, as the ne- 
 cessary and proper means for carrying into effect any of the enumerated powers. 
 
 This brings me to consider the observations of the gentleman (Mr. CRAW- 
 FORD) upon the 4th article of the constitution, in the following words: 
 
 'Full faith, and credit shall be given, in each State, to the public acts, records, and 
 judical proceedings, of every other State. And the Congress may, by general laws> 
 prescribe the manner in which such acts, records, and proceedings, shall be provcd r 
 und the effect thereof. 
 
 " The citizens of each State shall be entitled to all privileges and immunities of citi- 
 zens in the several States. 
 
 " A person charged, in any State, with treason, felony, or other crime, who shall ftee 
 from justice, and be found in another State, shall, on demand of the Executive au- 
 thority of the State from which he fled, be delivered up, to be removed to the State 
 having jurisdiction of the crime. 
 
 " No person held to service or labor in one State, under the laws thereof, escaping 
 into another, shall, in consequence of any taw or regulation therein, be discharged 
 from such service or labor, but shall be delivered up on claim of the party to whom 
 such service or labor may be due/' 
 
 The gentleman observed, that this article contained no grant of power what- 
 ever; it was merely declaratory of certain principles, which ought to be left to 
 the States to carry into effect; yet Congress had passed laws in relation to se- 
 veral of these subjects &c. and of course transcended the limits of the consti- 
 tution; or rather had legislated upon subjects not enumerated, &c. To these 
 observations I would reply that I do consider these clauses as investing the 
 Government, generally, with the exercise of all these powers, although the par- 
 ticular department intended for their exercise is not here designated; but by 
 reading these clauses in connexion with the clause before read, it wdl be 
 found that Congress is entrusted with the execution of these powers. 
 
 Congress shall have power to pass all laws which shall be necessary and 
 
 _ _ j* !4-*-,. s^.Fs\s>4- -4-Krk 4-/rrirrr\in rr r^r\nr/i'c: otiM all /A'Mior' TiniVPfS 1)P$f- 
 
ON THE BILL TO RENEW THK CHARTER OF 1791. 339 
 
 I presume to be strictly of this description. That this is the understand- 
 ing of the article, is evinced by the concurrent opinions of the General and 
 State Governments in those respects. 
 
 The difference of opinion, therefore, between the gentleman and myself 
 consists in this: That the principles here declared, he thinks, ought to be ex 
 ecu ted by the State authorities; and I think they were intended to be executed 
 by Congress; and it' my interpretation be correct, then Congress has not trans- 
 cended the limits of its authority. 
 
 Tins solution is at least satisfactory to myself. Another argument urged 
 by the honorable gentleman (Mr. CRAWFORD) requires some attention. The 
 gentleman considered the General and State Governments, taken collectively, 
 as forming one complete sovereignty; he then referred to a clause in the con- 
 stitution which he conceived excluded the State Governments from the right 
 to grant bank charters; and thence inferred the right in the General Govern - 
 inent, &c- Although I have full confidence in the opinions generally ex- 
 pressed by that gentleman, I cannot concur with him in this mode of deriv 
 ing power to the General Government. It is directly repugnant to the princi- 
 ples of construction [have just suggested, and therefore! cannot yield my 
 assent to it. 
 
 The 10th section of the 1st article says: " No State shall enter into any 
 treaty of alliance or confederation; grant letters of marque and reprisal; coin 
 money, emit bills of credit," &c. The particular terms of this section, se- 
 lected to exclude the States from incorporating banks, aie these: **No State 
 shall emit bills of credit." The. gentleman supposes that a bank bill isa bill 
 of credit, and therefore, that the States cannot establish an institution to i--u<- 
 a bill of credit Our ideasdiffer as to the meaning of the term 4i bills of credit."* 
 \> to the argument of the gentleman, that he who does an act by another docs 
 it by himself, it does not apply to the present case: for, if we recur, to the 
 charters of incorporation, we shall find that a particular fund is fixed, and that 
 this fund only is answerable for the redemption of the notes. The argument 
 of the gentleman would as well apply to every common note, juvrn by one in- 
 dividual to another; because the Slates as much issue bills of credit by pro- 
 tecting promissory notes, as by authorizing banks to issue such notes. In case 
 of notes given by individuals, they become the property of him to whom they 
 are payable; the drawer is responsible for the amount, and the State enforces 
 the payment. In that case, too, the whole property of the drawer is pledged 
 for the payment. In the case of bank bills, nothing is pledged but the sum 
 specified in the charter. The real meaning of this clause, therefore, 1 under 
 stand to be, to prevent the emission of bills, the payment of which is to be 
 made by the States, themselves; similar to the old continental paper money; 
 for that was evidently iu the contemplation of the framers of the constitution, 
 when they very wisely denied the power of issuing such bills to the States. 
 
 The gentleman from Georgia next read the 1st section of the third article 
 of the constitution. I should not take up the time of the Senate in noticing 
 it, but that the construction which I then put upon it differs from that which 
 he gave as an universal admission. The gentleman supposed there had been 
 some departure from the constitution, under the following clause: k * The judi- 
 cial power of the tJnited States shall be vested in one supreme court, and in 
 such ^inferior courts as the Congress may from time to time ordain and esta- 
 blish." The gentleman observes that, at the time of the repeal of the judiciary 
 act, it was generally admitted by the advocates of the repeal, that the su- 
 preme court was not tangible. That was not the opinion I then expressed; 
 and the opinion I then expressed has, since that time, been .strengthened and 
 confirmed by further reflection. 1 do not know how the gentleman's argu- 
 ment can apply to the case under consideration, unless he meant to shew that 
 the decision in that respect, made by Congress, w r as unconstitutional. My 
 opinion is, that it was constitutional, and that Congress might constitutionally 
 modify and change the supreme court in the most essential point; and permit 
 me here to protest against the usual mode of construing the constitution ]>y 
 analogy. Instead of examining the expressions of the constitution itself to 
 
340 BANK OF THE UNITED STATES. 
 
 ascertain its meaning, we are often referred to certain principles borrowed 
 from British jurists. Thus we are often referred to the fundamental princi- 
 ple of the separation of departments, &c. the independence of judges, &c. 
 although neither of these terms are to be found in the constitution; and the 
 principles, although correct in themselves, as general- principles, are subject 
 in practice to material qualifications and limitations; and this is particularly 
 the case in the constitution. It appears to pie as easy to ascertain the true 
 meaning of the words used in the constitution, as the meaning of these or any 
 other terms; and the error in this mode of reasoning generally, arises from the 
 misapplication of the terms to the subject in question; or, in other words, when 
 reasoning from analogy, in recollecting the resemblances and overlooking the 
 differences in eases supposed to be analogous. To ascertain the true meaning 
 of the constitution, therefore, I have always had reference to its own words,, 
 and discarded all reasoning from its analogy to any thing else. By referring 
 to the clause respecting the judicial department, just read, and taking it in 
 connexion will* the clause which declares that Congress shall have power to 
 pass all laws which shall be necessary and proper for carrying* into execution 
 all the powers, &c. " vested in any department," &c. it will appear obvi- 
 ous, that Congress might, according tathe express words of the constitution, 
 establish the judicial department, as it has done; and from time to time alter 
 or modify it at its discretion, &c.; and if Congress thought proper to increase 
 or lessen the number of judges of the supreme court? or to increase or lesser> 
 the duties to be performed by them, I would ask, where is the constitutional 
 prohibition? I see none. Congress can designate the duties of the court and 
 the compensation of the judges. They may takeaway the duties, and of course* 
 also, the compensation. And why? Because we find .the service and ? compen- 
 sation inseparably connected, and the one made the consideration oi the other- 
 Congress has a right to designate the services- which the judges shall perform? 
 And by what authority will they retain compensation after the services to be 
 performed are taken away? It is not the name of office, nor good behavior in 
 it, for which compensation is constitutionally given f but for service rendered. 
 The reason of this article, in relation to the -supreme court, is very obvious. 
 It was to obtain an uniformity of decision; and if Congress establish one su- 
 preme court, they perfectly satisfy all the injunctive part of the constitution, 
 But, I eto not know how the gentleman's reference to this clause could affect 
 the constitutional question in the present case. 
 
 I have thus far endeavored to explain and reconcile to the constitution those 
 laws passed by Congress, which the gentleman has considered contrary to the 
 constitution. 
 
 I will now proceed to some other arguments of the gentleman. He observed 
 that the bank law had been in existence fi<r twenty years, during which time 
 there had been an acquiescence in the law. I concur in that opinion. I do 
 consider that all the instances presented by the gentleman, to wit: authorizing 
 the bank to letid money; the extension of its right of establishing branches to 
 New Orleans in 1804; and also the act to punish counterfeiting bank paper, in 
 1807, ought to be considered as acts of acquiescence by the Government in the. 
 constitutionality of that law. 
 
 I have given the most respectful attention to the arguments used by the op- 
 posers of the bill, to account for this acquiescence, and to obviate the reasoning 
 drawn from it by its friends; and, whilst I give the gentlemen in opposition 
 great credit for the ingenuity of the argument, I cannot concur in the reason - 
 ing upon which it is founded. I understand it to be bottomed upon the idea, 
 that the bank law \vas in the nature of a contract; and that, under its influ- 
 ence, private rights became vested in individuals; and that, therefore, the 
 Government was bound to carry it into eu'ect, and that a refusal to have done 
 so, or the repeal of the act, would have been a violation of good faith, &c. &c. 
 The honorable gentleman from Tennessee (Mr. ANDERSON) observed, that the 
 republican administration, viewing this law in the nature of a contract, from 
 a saci ed regard to the preservation of good faith, passed these several acqui- 
 escing laws, &c. &c. The observation of the gentleman, so far as it respected 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 34 J 
 
 the manifestations of good faith on the part of the republicans, was certainly 
 both just and pertinent The republicans have certainly fulfilled, with the 
 most scrupulously fidelity, all the public engagements of their predecessors as 
 well as their own; yet I do not believe that these several acquiescing laws 
 were passed under the pressure of any obligation for the preservation of good 
 faith. 
 
 I concur with the honorable gentleman from Georgia (Mr. CRAWFORD) in the 
 conclusions he drew against this argument, of the imperious obligation due to 
 contracts, under the influence of this law; but not precisely for the reasons 
 he assigned for them. The gentleman observed, that it was essential, in the 
 formation of contracts, that there should be parties, and a consideration. That, 
 under the bank law, there was no sufficient consideration for the formation of 
 a contract. In this I am inclined to think the gentleman is mistaken. I pre- 
 sume the mistake has arisen from an inattention to the circumstances under 
 which the law was passed. Under the terms of the law, there were facilities 
 given to the United States by the bank, of very considerable value. The bonus 
 given was certainly a sufficient consideration to make the contract binding on 
 the part of the United States. But I have several objections to this argument 
 urged against the bill. In the first place, parties and a consideration are uot 
 only essential to the formation of a contract, but parties capable of contract- 
 ing. If the bank law be unconstitutional, then it cannot, as I conceive, give 
 a constitutional capaci/y to the artificial person created by it to contract. An 
 unconstitutional corporation lias no more a constitutional or le^al capacity to 
 contract, than a married wuman, or even an idiot, each equally laboring under 
 legal disabilities. The argument, therefore, which is used, to shew that the 
 bank law is unconstitutional, and, at die same time, gave a constitutional ca- 
 pacity to an artificial person to contract, appears to me to be in the nature of a 
 felo de se it destroys itself- Hence I conclude, that, if the law be unconsti- 
 tutional in itself, it cannot confer on an artificial person a legal capacity to 
 contract; and that any contract, made under its influence, would be void, for 
 the want of that legal capacity. In the next place, if it be urged that Congress 
 is bound to carry into eftect all contracts in which individual rights or interests 
 are concerned, then Congress may, in this way, derive to itself all the powers 
 it may want for an object, instead of getting them by the shorter route of the 
 assumption, under the terms common defence and general welfare; and in a 
 much more exceptionable mode; because, it may not only thus acquire any 
 power whatever, but may also acquire it in perpetuity. Hence, it appears to 
 me that, if gentlemen should succeed in establishing this argument, they 
 would lose more by the admission, than they would gain by limiting the powers 
 of Congress to the enumerations of the constitution. In fact, that argument 
 would be rendered worse than nugatory by this admission. 
 
 But I have a third objection to this argument of the obligation of the con- 
 tract, mwre formidable than either of the preceding. It appears to me to be 
 an argument against a fact. I know it is so as it respects myself. I have 
 been present when most of these acquiescing laws have been passed, and I 
 have no recollection of having been influenced in the votes I gave in their fa- 
 vor, by a view of the sacred obligations due to contracts; nor do I recollect to 
 have heard this consideration urged by any gentleman, at the time of passing 
 these several laws. In fact, at the time of passing the law for punishing coun- 
 terfeiting the bills of the Bank of the United States, I recollect no other con- 
 sideration operating on me, than the information that certain unprincipled in- 
 dividuals were counterfeiting bills in general circulation, to the great injury 
 of the honest part of the community. I thought such conduct ought to be sup- 
 pressed, and therefore voted for punishing all who should be engaged in it, 
 without much attention to the constitutional question respecting the bank law. 
 
 tainly not apply to those gentlemen who voted under the suggested impres- 
 sions. The general principle operating with me, was this: that all laws pass- 
 
342 BANK OF THE UNITED STATES. 
 
 ed by Congress must be considered as constitutional, until they are repealed. 
 Their unconstitutional ity is a good reason, and the best reason, for their re- 
 peal; but, so long as they remain in the statute book unrepealcd, they must be 
 considered constitutional, and, in my judgment, no tribunal on earth can ques- 
 tion their validity; nor can 1 admit that they are subject to the censorial 
 power claimed by the judiciary. I am, therefore, disposed to admit the acqui- 
 escence in the bank law, and to give the gentlemen in favor of renewal all 
 the advantage of the precedents quoted by them for that object, considered 
 under all the circumstances of the case; and to what do they amount? Will 
 they go so far as to preclude the present Congress from exercising its sound 
 discretion upon the constitutional question, when brought directly to its con- 
 sideration? and when, at the time of the several precedents quoted, it was 
 only collaterally or incidentally considered, if considered at all? Certainly 
 not; and, if in exercising the right of reviewing the constitution, the present 
 Congress should be convinced that a former Congress had exceeded its limits, 
 is it not bound by every conscientious consideration to correct the error, and 
 to bring the laws within its wholesome provisions? It appears to me not only 
 to be the right, but the indispensable duty of Congress to do so. 
 
 I will now proceed to animadvert upon some important observations made 
 by two gentlemen, upon the right of the Legislatures of the respective States 
 to instruct the Senators of the United States. 
 
 Acting, as I now am, Mr. President, under the influence of instructions 
 from the Legislature of the State I have the honor to represent, I feel myself 
 imperiously called upon to notice some observations which fell from the hon- 
 orable gentleman from Georgia (Mr. CRAWFORD) and the honorable gentle- 
 man from Pennsylvania, (Mr. LEIB) in relation to that subject. 
 
 The honorable gentleman from Georgia (Mr. C.) feelingly complains of 
 the tendency of instructions from the great States, to embarrass the proceed- 
 ings of this Government, by giving an undue bias to the deliberations, and 
 restraining the free exercise of opinion in this honorable body, &c. &c. With - 
 out particularly adverting to the emphasis laid by the honorable gentleman 
 upon the term " great States ," I agree in general with the gentleman in his 
 opinions in that respect. But, sir, in the present case, it may be observed, 
 that the questions ot instruction to Senators was first moved in the State of 
 Maryland. Now, sir, Maryland, although great in virtues and resources, is 
 not so great, in point of population and extent of territory, as to have obtained 
 the denomination of a great State. The proposition, then, however, was re- 
 jected by one vote. A similar motion, I am informed, is now depending be- 
 fore the Legislature ol New Jersey. New Jersey, like Maryland, although 
 great in virtues and resources, is not so great in point of population and ex- 
 tent of territory, as to have obtained the denomination of a grtat Mate. 
 Indeed, sir, the right to instruct Senators has not been exclusively acted upon 
 by the great S'.ates, generally so called, during the operations of this Govern- 
 ment; but, I admit, has been more frequently resorted to by them. 
 
 The gentleman from Pennsylvania, (Mr. LEIB) after having read his in- 
 structions, informed the Senate that he represented one of the great States 
 which had given instructions, and that he felt himself absolutely bound by 
 them in the vote he should give on the present question: that he considered 
 himself the representative of the Legislature of Pennsylvania; that it was the 
 principal, arid he the agent, and he was bound to carry into effect its will, &c. 
 However high may be the respect I generally entertain for the opinions of the 
 honorable gentleman (Mr. L.) I am compelled to dissent from him in these 
 opinions. I feel myself compelled, too, to express this dissent, lest it might 
 be supposed that, being smilarly circumstanced with that gentleman, on the 
 present question, my conduct might be influenced by similar considerations. 
 
 I do not consider myself the representative of the Legislature of Virginia, 
 although I feel the most unbounded confidence in its wisdom and patriotism, 
 and the highest respect for its proceedings. I consider myself the represen- 
 tative of the People of the United States, delegated to that character by the 
 Legislature of Virginia. As an evidence of the correctness of this opinion, 
 
ON THE BILL TO RENEW THE CHARTER OF 179.1. 343 
 
 I have only to remark, that the laws which I contribute to pass, in the cha- 
 racter of Senator, are co-extensive with the United States, and operate upon 
 the People thereof in their individual capacities. They do not operate upon 
 the State Legislatures in their corporate, characters, except in cases where, 
 in that character, they; are connected with the Federal Government, or instru- 
 mental in the execution of some of its powers. Still less do they operate 
 upon the Legislature of Virginia exclusively; of course, I cannot consider 
 myself as the representative of that Legislature exclusively, as its agent, and 
 bound, iu all cases, to execute its will upon this floor, &c. &c. It is not ne- 
 cessary, nor do I mean to question the right of the State Legislatures, so long 
 practised upon, to instruct the Senators of the United States, chosen by them, 
 respectively; because that might produce an unmeaning and useless discus- 
 sion about terms; but I mean to inquire, whether the exercise of the right 
 imposes a constitutional obligation on the Senator instructed, to obey; in 
 what the real obligation to obedience consists; whether the instruction is in- 
 junctive and compulsory on him, or addressed only to his discretion;^ or, in 
 other words, whether the Senator instructed has not a right to disobey? and 
 whether such disobedience violates any moral or political obligation? I also 
 propose to make a few observations on the operation of instructions upon the 
 Federal Government and its proceedings. '1 hat the Senator instructed has a 
 constitutional and legal right to disobey his instructions, is most obvious to 
 my understanding, from the single consideration, that a law passed by a vote, 
 in disobedience of instructions, is as valid as a law passed by a vote in obedi- 
 ence to instructions. Obedience to instructions is no where commanded, 
 nor is disobedience of instructions any where prohibited, by any written law 
 or constitution. The act of disobedience does not subject the disobeying 
 Senator to any punishment whatever; of course, the disobedience of instruc- 
 tions violates no political duty, and, if the instructions be addressed only to 
 the discretion of the Senator,* his disobedience of them violates no moral obli- 
 gation; provided he exercises a sound and conscientious discretion, founded 
 upon the best reflections he is able to bestow upon the subject thus presented 
 lor consideration. I therefore conclude, if the State Legislatures possess the 
 right to instruct Senators of the United States, chosen by them, respectively, 
 it is an incomplete right, without a remedy, or with a very remote one- The 
 influence or the true obligation of instructions, therefore, arises from the ex- 
 pression* of opinion by the State Legislatures; and the very high respect 
 which is at all times due from the Senator to the expression of such opinion 
 by the Legislature of the State he represents a respect which I feel so strong 
 ly, that I never would depart from an opinion thus expressed, unless in a clear 
 and indisputable case; but the point I contend for is, that this opinion is not 
 injunctive, compulsory, or mandatory. That it is not in the nature of a com- 
 mand, but addressed to the discretion of the Senator instructed: taking into 
 due consideration all the circumstances of the case connected with such in- 
 structions. 
 
 It may be said, that the Senator is responsible to the Legislature which ap- 
 points him, at the expiration of his term of service; this is true, if applied to 
 the individuals who may compose the Legislature at that time; but it does 
 
 * It is presumed that this was the sense in which the Legislature of Virginia viewed 
 this subject in 1800. In the memorable instructions of that day, the Legislature pre- 
 faces them with a declaration to the Senators of the United States, that they deem it 
 important " to express their opinions" upon the subject of instructions. Then fol- 
 lows a course of reasoning, to convince the Senators of the propriety of the opinions 
 thus expressed. The instructions in this case, therefore, were clearly addressed to 
 the discretion of the Senators, and not considered as imposing a positive demand. 
 
 In 1808, the Legislature of Virginia instructed the Senators of the State, in the 
 Congress of the United States, to use their best endeavors to obtain amendments to 
 the constitution of the United States, which, in effect, would make the Senators of the 
 United States recallable at the pleasure of the Legislatures of the respective States. 
 It is presumed that the Legislature did not consider its instructions mandatory^ and 
 
344 BANK OF THE UNITED STATES. 
 
 not vary my conclusion; because, every act he performs, whether instructed 
 or not, is an act of responsibility; and the most which can be inferred from 
 this idea, is, that it increases his responsibility, and would naturally produce 
 caution; but cannot affect his right to disobey. 
 
 It cannot escape attention, that I purposely avoid all observations upon the 
 rights of the People, as the legitimate source of all power in their highest so 
 vereign capacities, and upon whom all laws passed by their representatives, 
 operate in their individual characters, to instruct all their representatives, 
 which, I presume, if practicable, would not be denied by any; because such a 
 discussion would be unnecessary upon the present question. The inquiry I 
 am making respects the right of one set of representatives of the People, cho- 
 sen for certain purposes, to give mandatory instructions to another set of re- 
 presentatives of the People, chosen for other purposes, without any written law 
 to that effect, and by the mere force of implication. If it should be contended 
 that the Senators ot the United States are the representatives of the Legisla- 
 tures of the respective States, and not the representatives of the People of the 
 United States, in their individual characters, contrary to the express provi- 
 sions of the constitution, then this absurd conclusion would follow: that the 
 People of the United States are governed by laws, not passed by their repre- 
 sentatives, but by the representatives of their State Legislatures, in their cor- 
 porate characters, contrary to the fundamental principles of all republican 
 Governments, and directly opposite to the universal expectations of the whole 
 American People. 
 
 But. sir, let us resort to the constitution itself, and see the actual relations 
 which do there exist between the Legislatures of the respective States, and 
 the Senators of the respective States, composing the Senate of the United 
 States. 
 
 In the 3d section of the 1st article of the constitution, are these words: 
 4i The Senate of the United States shall be composed of two Senators from 
 each State, chosen by the Legislature thereof, for six years, and each Senator 
 shall have one vote." In another place, are these words: " And if vacancies 
 happen, by resignation or otherwise, during the recess of the Legislature of 
 any State, the Executive thereof may make temporary appointments, until 
 the next meeting of the Legislature, which shall then fill such vacancies." 
 These clauses of the constitution present all the relations between the Legis- 
 latures and Executives of the respective States, and the Senators of the Unit- 
 ed States; and in what do they consist? Certainly in nothing but in choosing 
 the Senators; when that is done, all the functions, of the Legislature and 
 Executive are at an end, quo ad that particular subject. I see no influence 
 iven, either over the votes or the acts of the Senator, during the six yeara 
 for which he is elected. During that period, the Senator is entrusted with 
 the execution of all the powers and authorities conferred upon him by the con- 
 stitution, at his own discretion, subject only to his constitutional responsibility, 
 at the expiration of his term of service. But it may be said, that the right to 
 instruct arises from the necessary connexion between the constituent and the 
 representative. To this it may be replied, that this, upon the general princi- 
 
 that the instructed Senator was bound to obey, or in other words, had no right to dis- 
 obey. Because, if the Senator was bound to obey the instructions of the Legislature, 
 it might instruct him to resign, upon the same principle which would authorize in- 
 structions how to vote; and if the instructions be mandatory, the instructed Senator 
 would be bound to resign as well as vote conformably thereto,- of course, such an amend- 
 ment to the constitution would be unnecessary. The Senators from Virginia, with 
 the most respectful attention to the opinion expressed by the Virginia Legislature, in 
 the most respectful terms, presented the instruction to the consideration of the Senate; 
 but never thought themselves bound to use their best endeavors to obtain the amend- 
 ment to the constitution, as they were instructed to do. The Legislature, however, 
 forwarded the proposed amendment to the other State Legislatures for concurrence; 
 and, as far as information is yet received, the proposition has been unanimously disap- 
 proved by every State Legislature which has acted upon it. 
 
OX THE BILL TO RENEW THE CHARTER OF 1791. 345 
 
 pie, is a constructive or an implied right; but I doubt its application, at least 
 m its full force, to this particular case. The relations in this case, between 
 the constituent and the. representative, are expressly prescribed by the con 
 stitution; neither of them can claim any original or native lights; and no con- 
 struction nor implication ought to be inferred against its provisions, not in- 
 consistent with its obvious meaning. Besides, if this mere implication be the 
 
 contended for, that the instruction is mandatory s^A conclusive. Will jt not 
 also apply to the connexion between the electors and the Presidentof the United 
 States? I find, by the 2d article of the constitution, that the President of the 
 United States is to be chosen by electors appointed by the several States, 
 and they, of course, become the immediate constituents of the President. Hut 
 what would be thought of their inferring a righr, from this connexion, to in- 
 struct the President of the United States in what manner to execute the 
 powers and duties of his office? And what would be the probability of a con- 
 currence in such instructions from the different electors of the several States? 
 The President's responsibility is tested at the expiration of every four years; 
 that of a Senator, at the expiration of every MX years; and I believe that the 
 changes of the individual electors in the several States are Hot greater, at the 
 expiration of every four years, than are the changes in the individuals com- 
 posing the^ Stale Legislatures, at the expiration of every MX year.-. The re- 
 sponsibility of the President ot the United States, therefore, may be considered 
 as great, or greater, to his electors, than the reponsibility of the Senators of 
 the United S'lates to the respective State Legislatures: for. I contend, the 
 responsibility of the Senator is not to the Slate Legislature, in its corporate, 
 character, but to the individuals who may happen to compose the State Legis- 
 lature at the time of his election, in their individual capacities, described only 
 by the corporate term. It is believed that a pretension of this kind, by the 
 electors of the President of the United States, would not be tolerated even by 
 the State Legislatures. But, is there nothing expressly contained in the con- 
 stitution of the United States, which would afford a stronger implication 
 against the exercise of this right by the State Legislatures, than the implica- 
 tion from which the right is said to be derived? I think the very first words 
 of the constitution, after the preamble, afford strong evidence of the exclu- 
 sion of the right of the State Legislatures to give mandatory instructions to 
 the Senators of the State. They are the following: " All legislative powers, 
 heretofore granted, shall be vested in a Congress of the United States, which 
 shall consist of a Senate and House of Representatives." Now, sir, upon the 
 principle of mandatory instructions from the State Legislatures to the Sena- 
 tors of the United States, will Congress exercise all the legislative powers 
 granted by the constitution? Will not the State Legislatures essentially par- 
 ticipate in the exercise of the legislative powers? It they can command and 
 direct the votes of one distinct and essential branch of Congress, upon all 
 legislative subjects, will it not be a material participation in the legislative 
 powers granted exclusively to Congress? Could they not thus embarrass the 
 whole proceedings of Congress? Could they riot render all deliberations on 
 the part of the Senate unnecessary? Could they not thus deprive the Govern- 
 ment itself of all energy and efficiency? Surely the wise framers of the con- 
 stitution could never have anticipated, still less could they have sanctioned, 
 .the assertion of such principles. 
 
 These considerations bring me to examine the tendency of the principle 
 contended for, upon the character arid proceedings of the General Govern- 
 ment; and, sir, had it not been for the opinions I entertain on this question, 
 I should not have given the other the critical examination I have attempted; 
 but, sir, such is my opinion of the injurious effects of the practice of giving 
 instructions by the Legislatures of the States to the Senators of the United 
 States, that I deem it my indispensable duty to give the subject a full and 
 44 
 
546 BANK OF THE UNITED STATES 
 
 candid investigation,* although, in doing so, I know I shall have to encounter 
 strong and honorable, and perhaps insuperable prepossessions against my 
 opinions; particularly in the State I have the honor to represent, t wish it 
 to be understood, however, sir, that, in the discharge of my duties on this 
 floor, I shall always obey the honest dictates of my own judgment; and when- 
 ever I see, or think I see, danger of any kind threatening the due administra- 
 tion of this Government, I will, at all times, endeavor to expose it to the view 
 of the People, and particularly of those from whom the unintentional danger 
 is apprehended, regardless of any consequences to myself upon the political 
 theatre. The best mode of appreciating the tendency of mandatory instruc- 
 tions upon the proceedings of the Federal Government, will be to bring to our 
 recollection the great points of difference between the present Government 
 and former confederation. 
 
 Under the former confederation, the States voted in their coporate charac- 
 ters,- and if the representatives of any one of them were equally divided in 
 opinion, the State gave no vote. Under the present Government each repre- 
 sentative votes in his individual character, and upon his individual responsi- 
 bility. The words of the constitution are, 4 ' and each Senator shall have one 
 vote." Under the former confederation, the requisitions of Congress operat- 
 ed upon the States in their corporate characters. Under the present Govern- 
 ment, the laws of Congress operate upon the People of the United States in 
 their individual characters. 
 
 The former Congress did not possess the means necessary and proper 
 for executing its own will upon the subjects confided to its deliberations. 
 The present Congress possesses power to carry into effect its own will or its 
 laws, upon all subjects confided to its management. These are amongst the 
 great points of difference in the character arid powers of the two Govern- 
 ments. The former government fell to pieces from the feebleness of its orga- 
 nization, and principally from the want of power to execute its ownwill^ from 
 its dependence upon the State Legislatures for the execution of its requisi- 
 tions. 
 
 Now, sir, if the State Legislatures possess the right to give mandatory in- 
 structions to their Senators, respectively, I see very little difference in the 
 character of the present and former confederation;, for there can be very little 
 difference in the practical effect of the principle of requisitions by Congress 
 upon the State Legislatures, which may be rejected at their discretion > and 
 the principle of the State Legislatures making requisitions by mandatory in- 
 structions upon one essential branch of Congress; which must be obeyed by 
 that branch, in exclusion of all discretion whatever. The feebleness and in- 
 congruity of the latter principle is. in my opinion, at least equal to the first; 
 and, if admitted and indulged in, will as certainly terminate in the ruin and dis- 
 solution of the Government. Another injurious tendency of mandatory instruc- 
 tions is, to add to the locality of feelings and opinions of the deliberations of this 
 honorable body, already top strong by native and habitual prepossessions and pre- 
 dilections. Another injurious tendency vf mandatory instructions results from 
 their influence in restraining the free exercise of opinion in the diliberations 
 of this honorable body; and, if generally practised upon, would render all 
 deliberations unnecessary. The incongruity of mandatory instructions to the 
 operations of this Government will appear more obvious, by reflecting, 
 that y if the same measure were to be concurred in, and required by every 
 vState Legislature in the Union, and their Senators peremptorily instructed 
 to effect it, without exercising any discretion of their own, it is probable that 
 such would be the difference in the mude or detail of the instructions from 
 the respective State Legislatures, as to put it out of the power of the Senate 
 to effect their object, the Senators from each State being bound ta pursue the 
 mode pointed out to them by the Legislature of the State they respectively 
 represent. Indeed, such is my opinion of the tendency of the principle of 
 mandatory instructions, that 1 should regret very much to see it established 
 and frequently resorted to. The practice, in my opinion would eventuate 
 in producing feebleness and inefficiency in the General Government; collision 
 
g 
 B 
 
 ON THE BILL TO RENEW THK CHARTER OF 1791. 347 
 
 among the several States: and finally disunion and dissolution of the General 
 Government. 
 
 Sir, I now am, and always have been, attached to an efficient government; 
 a government strong enough to repel external violence, and to ensure domestic 
 tranquillity, and to secure the person and property of the individual citizens. 
 The Federal Government I conceive to be an indispensable instrument in the 
 effectuation of these great objects. I have often wondered at seeing gentle- 
 men of learning, of talents, and of patriotism, rejoicing at the curtailment of its 
 necessary powers. They seem to me to enjoy the triumph of every event of this 
 kind, as much as if they had plucked a laurel from the brow of their most inve- 
 terate enemy, and placed it round their own; not being^sufficiently impressed, 
 in my judgment, with the importance of the Federal Government to the pre- 
 servation of their own personal safety, and the security of their property, &c. 
 
 The gentleman from Georgia (Mr. CRAWFORD) was pleased to say, mat, in 
 iving I instructions to the Senators upon this occasion, the great States had 
 een influenced solely by motives of avarice. I regret the remark; and I 
 think, if the gentleman would dispassionately reconsider it, he would also re- 
 gret it. I think he would admit that the Legislature of Virginia could not 
 have acted under the influence of such a motive. And, sir, I feel a pride arid 
 a pleasure irt standing here to repel the imputation, and to do justice to the 
 real motives of the Legislature. I am at a loss to determine what are the 
 particular circumstances which could have induced the gentleman to ascribe 
 the motive of avarice to the Virginia Legislature on this occasion. It is true, 
 that a branch of the Bank of the United States, with the trifling capital of 
 300,000 dollars, is established at Norfolk; and that a branch of the Bank of 
 Virginia is also established there. But these circumstances furnish no possible 
 motive of avarice to the Virginia Legislature^ The amount of capital and its 
 effects, are quite unimportant to the State. Norfolk itself, although equally 
 respectable and important with any other portion of the State of tiic same ex 
 tent and population, is not sufficient to excite the avarice of the VVginia Le- 
 gislature. The Legislature of Virginia consists principally of agriculturists, 
 residing in the interior of the State, who concern themselves very little with 
 banks and bank operations. They therefore have made no calculations of 
 pecuniary interests upon this occasion. They have acted, in giving instructions, 
 irpm the purest and most honorable motives, from a conviction mat the power 
 of granting charters of incorporation was not conferred on Congress by the 
 constitution, but reserved to the States, respectively. That this conviction 
 alone was the inducement to their instructions will appear obvious from the 
 instructions themselves, which I beg leave to read: 
 
 The General Assembly of Virginia view, with the most serious concern, the late 
 attempts which have been made to obtain from Congress a renewal of the charter in- 
 corporating- the Bank of the United States. 
 
 This Assembly are deeply impressed with the conviction that the original grant of 
 that charter was unconstitutional; that Congress have no power whatever to renew it; 
 and that the exercise of such a power would be not only unconstitutional, but a 
 dangerous encroachment on the sovereignty of the States. Therefore, 
 
 Resolved, That the Senators of this State in the Congress of the United States be 
 instructed, and our Representatives most earnestly requested, in the execution of their 
 duties, as faithful representatives of their country, to use their best efforts in oppos- 
 sing, by every means in their power, the renewal of the charter of the Bank of the 
 United States. 
 
 January 22, 1811. Agreed to. 
 
 ROBERT TAYLOR, S. S. 
 JAMES BARBOUR, S. H. D, 
 
 A copy from the original. 
 
 Test. JAS. PLEASAXTS, c, u. D. 
 
 It manifestly appears from these instructions that a conviction of the un 
 constitutionality of the original bank law was the sole inducement with the 
 Legislature for giving them; and here, sir, permit me to express a hope, that 
 the arguments I have urged, in tavor of this opinion, will amply justify the 
 
348 BANK OP THE UNITED STATES. 
 
 Legislature in the honest conviction under which it has acted. Permit mc r 
 also, to remark, sir, that, whilst I cannot admit that instructions in any case 
 possess a mandatory influence over the Senator; and whilst I think the prac- 
 tice of giving instructions in general, and upon general points of policy, is 
 attended with injurious effects upon the proceedings of this Government, &c.f 
 yet, in a case of rights reserved to the States, the Legislatures not only have 
 the right, but it is their duty to express their opinions to, or instruct, their 
 Senators (for I will not cavil about terms) to resist the usurpations of the 
 General Government. It is the mildest vyay in which their agency can be 
 brought to bear upon all such cases,- and, this being a case in point, the in- 
 structing Legislatures stand perfectly justifiable in the conduct they have 
 adopted in that respect. I hope, sir, that I have rescued the Legislature of 
 Virginia from the unmerited imputation thrown against it, inadvertently I am 
 sure, by the gentleman from Georgia, (Mr. CRAWFORD) and have shown that 
 it has been influenced by the purest, the most laudable, and the most honora- 
 ble motives, &c. 
 
 I have, sir, thus presented to the Senate the most impartial and comprehen- 
 sive views, which my best reflections have enabled me to take of the constitu- 
 tional question involved in the present discussion, and of all the other topics 
 which have been incidentally connected with it. I will now proceed to ex- 
 amine the subject in another point of view. 
 
 Upon the question respecting the expediency of the renewal of the bank 
 charter, the friends of the bill claim the whole weight of the argument; whilst 
 some oi its opposers tacitly acquiesce in, and others faintly oppose this lofty 
 pretension. Notwithstanding these circumstances, I entertain very great 
 doubts upon that point. There appear to me to be considerations of great 
 weight against it; perhaps more than sufficient to counterbalance those urged 
 in favor^it. Both the gentlemen in favor of the bill relied very much upon 
 1he suggs$?on, that the prosperity of the United States was attributable y in a 
 very gr<&#tfegree, indeed almostexclusively, to the establishment and operation 
 of the Baivfe of the United States. I believe, sir, nothing is more difficult 
 than to ascertain the true causes of the wealth and prosperity of nations^ 
 very few* Writers have been successful in the investigation of that intricate 
 subject; but the adventitious establishment and operation of the Bank of the 
 United States are amongst the last causes to which I would ascribe their 
 rapid increase of wealth, and their general and extensive prosperity. It is not 
 to any adventitious local causes we are to look for these universal effects. If 
 I were to look for their real causes, I should expect to find them in the genius 
 and wisdom of our political institutions; in permitting every citizen to employ 
 his faculties at his own discretion, for the attainment of property; and secur- 
 ing to him the perfect and uncontrolled enjoyment of it when acquired. Each 
 citizen, thus acquiring wealth and prosperity to himself, would of course 
 accumulate the general stock, &c. These inestimable blessings have also 
 been attended with signal and peculiar advantages, with an exemption from 
 wars, and all other great political calamities, &c. &c. whilst that portion of 
 the world with which we have the most extensive commercial relations has 
 been, and still is, unhappily involved in wars almost interminable, and of the 
 most disastrous characters; from which, till Hitterly, our commercial fellow 
 citizens have derived advantages almost incalculable, and of course added 
 rreatly to the general stock of wealth and prosperity, &c. To these, and such 
 like causes, permanent in their character, and universal in their operation, 
 are properly to be ascribed the general wealth and prosperity of the nation; 
 and not to the adventitious circumstance of the creation of a bank; still less 
 should we rely upon this cause, when we reflect that the bank is local in its 
 operations: whilst the scene of prosperity is universal through the United 
 States, pervading those parts of them where the operations of the bank are 
 scarcely known, and its influence never felt, as much as those parts imme- 
 diately within the local point of its influence, &c. This argument, therefore, 
 I conceive has been urged by the friends of the bill greatly beyond its real 
 merits, and received with too much facility and effect by its opposers. 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 549 
 
 The gentleman from Georgia, (Mr. CRAWFORD) upon introducing to the con- 
 sideration of the Senate the report of the Secretary of the Treasury, was 
 pleased to say, that he should rely in some degree upon that report; although 
 he knew that mentioning it would excite invidious feelings in some of the 
 members of this body. 1 do not know to whom the gentleman meant to apply 
 his allusion. I can only say, for myself, that I think the report is entitled to 
 a respectful attention; that I would give it the same respect that I would 
 show to a report from the head of any other department. It has always been 
 my invariable habit to form my opinions from the facts contained in the docu- 
 ments before me, regardless of the authors of them; nor could I ever conde- 
 scend, in the discharge of my duty upon this floor, to permit personal con- 
 siderations to intermingle with, still less bias my deliberations. But, sir, I 
 see nothing very operative in the Secretary's report. He says, in substance, 
 that he has found in practice the Bank of the United States to be a convenient 
 . instrument for facilitating the management of the fiscal concerns of the nation; 
 which I believe is generally admitted. It is also true that the Secretary has 
 found it convenient, and has ventured to express his opinion in favor of the 
 constitutionality of the bank bill; and I am willing to give to the opinion 
 credit for what it is worth. No gentleman would say it ought to preclude 
 the free exercise of opinion by others; and I acknowledge, upon this particu- 
 lar subject, I am not inclined to give it the weight to which that gentleman's 
 opinion would be entitled upon other occasions; because he has uniformly 
 manifested too much zeal for the success of this bill, to leave the mind per- 
 fectly free in the investigation. He has, for a long time, used such various and 
 incessant means to effect the renewal, that his mind must, in some degree, be 
 divested of that cool ness and impartiality which arc indispensable to a critical 
 and correct analysis of the constitution. 
 
 The gentleman from Georgia (Mr. CRAWFORD) observed, that it was better 
 to have a bank dependent on the United States, than to increase the depen- 
 dence of the Government upon the State banks, over which the Government 
 of the United States cannot exercise any control. I would submit to the 
 honorable gentleman, upon further reflection, to say, whether the remark is 
 applicable to the bill under consideration. A f KM* the charter is once granted, 
 I see no control reserved to the Government. I fear the controlling influence 
 would be on the other side. If, however, there must be a United States' 
 Bank, I would prefer one of that character to the present project. I have 
 too much confidence in Congress to be alarmed at the influence of a bank 
 under its direction; and should greatly prefer it to one whose direction should 
 be under the influence of British capitalists. 
 
 The honorable gentleman from Massachusetts, (Mr. LLOYD) to whose dis 
 passionate, enlightened, and dignified observations, I listened with great plea- 
 sure, informed us, that there \\as a capital of fifty millions of bank paper in 
 circulation in the United States, and the specie circulation for its support did 
 not exceed ten millions ami that was daily diminishing. If this be the true 
 state of the circulating medium, I think the extension of bank paper circula- 
 tion already too great; and it would not be surprising to me, if a knowledge 
 of this fact alone should lessen its credit. Its excess has certainly become an 
 evil, and, instead of being still further extended, ought be curtailed. But the 
 most objectionable circumstance to this excess of circulation of bank paper, I 
 conceive to be its inevitable tendency to exclude the specie circulation, which 
 it substitutes. A specie circulation is certainly greatly preferable to paper 
 circulation; it has an intrinsic value in itself, whereas the paper circulation 
 has no intrinsic value; and its currency depends upon the value of the specie 
 circulation which it represents. Of course a circulation of value is excluded 
 from the country, and substituted by one of no value; and in times of war, or 
 other great political calamities, when the Government would stand most in 
 need of the aid of banks for its support, their capacity to lend would be the 
 most diminished, if not entirely destroyed, by the absence of specie capital, 
 which the circulation of bank paper has banished from the country. I presume 
 the gentleman would not consider the banishment of a circulation of intrinsic 
 
350 BANK OF THE UNITED STATES. 
 
 value, and substituting it with one of a representative value only, amongst 
 the prosperous effects resulting from the operation of the Bank of the United 
 States. The gentleman from Massachusetts (Mr. LLOYD) favored the Senate 
 with the perusal of his notes of the evidence of the democratic merchants and 
 manufacturers of Philadelphia. I paid great attention to this information, 
 derived from practical men, and should be sorry to misconceive it; and cer- 
 tainly could not disrespect it. But there were two facts, stated and assented 
 to by all of them, which seem to me irreconcileable with the opinions expressed 
 by those gentlemen, respecting the real causes of the present scarcity of 
 money, and the distresses consequent upon that scarcity. The first fact was, 
 that the bank in Philadelphia discounted precisely as much now, and proposed 
 to do so till the 4th of March, as it heretofore had done. The other fact was, 
 that the paper had not depreciated, but was still in good credit. The com- 
 plaint was not that the paper, when obtained, was not of good credit, and would 
 not answer their purposes, but that they could not obtain it. 
 
 Now, sir, I cannot conceive how the scarcity of money, and consequent 
 distress, can arise from any apprehension of putting down the bank, when 
 precisely the same sum of money is now put into circulation by it as was for- 
 merly done, and the money itself in good credit. The pecuniary distresses 
 complained of, in my judgment, are not properly attributable to these causes, 
 but to some others, more inscrutable, and which have escaped the observa- 
 tions of those gentlemen. Perhaps they may more justly be ascribed, in some 
 instances, to tne general embarrassment of the commercial world at present, 
 particularly the embarrassments of American commerce at the present mo- 
 ment, and perhaps, in some instances, to some unknown embarrassments and 
 difficulties in the particular occupations of the complaining individuals. There 
 is another fact to show, that the alarm at present is greatly exaggerated, or'is 
 certainly greatly beyond any real cause for it. It will appear, from the Se- 
 cretary's report, that the debts due to the Bank of the United States are only 
 $600,000 less now, than they were twelve months ago; of course the discounts 
 of the whole institution could only be lessened to that extent, and it is im- 
 possible for me to believe that the payment of that trivial sum, compared with 
 the whole mercantile capital of the United States, could be seriously felt by 
 the merchants generally, especially as they have been twelve whole months 
 in paying it. If the payment of that sum, in twelve months, could produce 
 all the distresses we hear of, I hope we shall hear no more of our immense 
 mercantile wealth, and the great extension of our mercantile capital. Yet 
 this is the only real cause for all the clamor and alarm circulating through the 
 country. I think, with some confidence, that the consequences of putting 
 down the bank of the United States must be artificially exagerated, or very 
 much misapprehended, and this opinion is grounded upon the consideration 
 that it is directly repugnant to the interest of the bank to cause the appre- 
 hended distresses, and its directors certainly have the power to avoid the 
 production of them. And 1 think that, when a calculation is made, and a con- 
 clusion drawn, upon the idea that a moneyed institution will pursue its own in- 
 terest, it may fairly be said to be grounded on a solid consideration. I can- 
 not see how putting down this institution can materially affect the pecuniary 
 abilities of the nation; its actual funds for discounting will be nearly the 
 same; the position of them only will be changed; they will find their way 
 into the State banks, and their ability to discount will be increased propor- 
 tionably to the increase of their deposites. Nor am I at all alarmed at the sug- 
 
 2stion that seven millions of dollars will be drawn out of the country by the 
 ritish capitalists, because it will not be their interest to do so; their dollars 
 are worth more here than in Great Britain; if drawn there, r they would soon 
 be melted down into their depreciated paper circulation. They might also 
 draw bills to advantage, so that I doubt whether an additional dollar will be 
 shipped from the country in consequence of the rejection of this bill. Cer- 
 tainly they will not to any great extent. 
 
 I will now, Mr. President, suggest a few considerations, which I acknow- 
 ledge have great influence on my mind in deciding on the expediency of the 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 proposed renewal of the charter of the Bank of the United States. I do it with 
 great diffidence, because I have not yet heard them suggested by any other 
 gentleman, at least not precisely as they affect my mind. I will, however, 
 present them to the Senate, and do not wish them to be appreciated beyond 
 what they are worth. In the incorporation of a bank upon the principles now 
 proposed, the great advantage to the stockholders consists in legalising their 
 credit, and authorizing them to draw an interest on it, as well as on their 
 money; individuals can obtain interest only on a loan of money; the bank is 
 authorized to obtain interest on a loan of credit, and that interest, according 
 to the reported dividends of the Bank of the United States, has been 8 per 
 cent, per annum, and it is probable it will continue quite as high. This ad- 
 vantage is not confined to the credit arising from the money owned by the stock- 
 holders; but, also, that which arises from the deposites of money belonging to 
 other people. Nor is this all; it extends to the credit which arises from the 
 enormous deposites of public money. It appears from the Secretary's report, 
 that seven tenths of the whole stock are held by British capitalists; perhaps 
 the proportion is greater, but covered, in some instances, by American names. 
 It also appears that they will have enjoyed the full term of these incorporated 
 advantages on the 4th of March next; of course, a refusal to renew them can- 
 not, in any respect, be considered as a departure from good faith. Now I 
 can see neither the policy nor expediency of extending these favors and ad- 
 vantages voluntarily to these foreigners for twenty years, in exclusion of our 
 own citizens, at least to the extent of the foreign capital now invested in the 
 institution. I think, sir, at the same time, I can see very strong and pecu- 
 liar grounds of objection to the policy and expediency of this measure. My 
 objection arises from the enormous British influence which notoriously per- 
 vades this country; and, I believe, affects the proceedings of Government so 
 seriously, that it can hardly be said to be independent. I verily believe that 
 this baneful influence has already driven the Government from measures which 
 the best interest of the nation required. 
 
 Whilst we find Great Britain claiming exclusive dominion on the ocean, 
 possessed of an immense mercantile capital and pecuniary resources, almost 
 inexhaustible, wo find many of her subjects intimately connected with our 
 citizens in commercial pursuits. \Vo lincl many mercantile houses in that 
 country associated witli mercantile houses in this, so much so, that when we 
 hear of great failures in Liverpool, we may look out for squalls and breakers 
 at New York. Not only has this influence operated on the people generally, 
 but I state it as my firm conviction, that it has operated, and now operates, on 
 the Government of the United States. Is this mercantile connexion the only 
 source of influence ? Not at all, sir; the influence accruing to Great Britain, 
 from the identity of language; from reading British books; from the prece- 
 dents derived from her systems of jurisprudence, inculcated in early life; 
 from intermarriages, and various other circumstances, paralyzes the efforts of 
 our country, and almost reduces it to a state of colonial dependence. I con- 
 sider this bank as giving that diversified influence a body and form for action. 
 Have we not been told that this bank has been so operative, as to elevate or 
 depress the State banks at pleasure ? As to enlarge or contract the circulat- 
 ing medium ? And is it desirable that such an engine should exist in the 
 hands of foreigners ? Take away this influence, and Great "Britain would 
 stand nearly on the same footing, in relation to us, that any other nation does. 
 I have not overlooked the observations of the gentleman from Georgia, in re- 
 lation to this'subject. He observed, if there be any influence, it is recipro- 
 cal; that these foreigners, having funds in the United States' Bank, will use 
 their best exertions to procure a respect for pur rights, or to keep the two na- 
 tions at peace. I believe they will; but, whilst they may have an influence in 
 this country, they will have none in their own. The influence of seven mil- 
 lions of dollars will not be felt in that country where three hundred millions 
 are annually expended, although it will have much weight here. There is. 
 then, no such reciprocation of influence as the gentleman supposes. I would 
 ask the gentleman how this influence has been heretofore exerted, in practice, 
 
352 BANK OF THE UNITED STATES. 
 
 upon the two Governments ? Has it been able to induce Great Britain to re- 
 lax in her hostility against us in the smallest degree? Has it prevented or 
 repealed the orders in council? &c. Has it saved from imprisonment one 
 American seaman? Did it prevent the attack upon the Chesapeake? In short, 
 has it restrained the hostile arm of Great Britain from any hostile act? &c. 
 On the other hand, how has it acted on our Government ? Has it not been 
 instrumental in paralysing every effort of resisting these hostilities? Has it 
 not cooled us down to a state of humble submission? &c. &c. &c. These are 
 its natural practical effects, and will continue to be so. 1 am very far from 
 wishing to interrupt the harmony and friendship between the United States 
 and Great Britain, provided they can be preserved on honorable terms, but 
 not by submission brought about by British influence. I find I have trespass- 
 ed too long on the indulgence of the Senate, but I beg to be permitted to reply 
 to two observations, one of which has been much relied on, and I will pass 
 over all others. 
 
 It has been asked by one gentleman, whether this was a very propitious time 
 for putting an end to this establishment? I admit that it is not; that very 
 serious embarrassments attend our commercial operations. The sequestra- 
 tions of France, the British orders in council, as well as the interruptions from 
 other countries, must have had a very serious effect on our commerce. I re- 
 gret that this measure is called for, at so inauspicious a time. I am willing 
 to admit that, if we enforce the non-intercourse, the pressure will not be les- 
 sened. But are these circumstances so inauspicious, as to warrant us in pass- 
 ing over solemn constitutional objections? Are they such as to warrant us in 
 still further increasing British influence in the nation? These are serious 
 considerations; and, in my judgment, furnish strong grounds of objection to 
 the policy and expediency of the proposed renewal of the bank charter. Gen- 
 ak of the impartiality of the bank as they please; but it is no- 
 
 tlemen may speal . ., . , 
 
 torious that it has always been hostile to all measures directed against Great 
 Britain, and against the administration generally; evinced in the choice of 
 directors, &c. 
 
 The honorable gentleman from Georgia (Mr. CRAWFORD) feelingly com- 
 plained, that this had artificially been made a party question by the course 
 adopted in its discussion. I fear the remark is too true; that this discussion 
 partakes too much of that character. I have endeavored to exclude every 
 idea of that nature from the observations just made. I always regret to see 
 any question, in discussion before this honorable body, assume the character 
 of parties. It is always unwise in the parly in power artificially to create 
 party questions. It reminds me of the silly boatswain, who, not content to 
 sail easily along before a pleasant breeze, puts up his whistle for a storm, 
 which, when it arrives, upsets his vessel, and sends her to the bottom. It is 
 our duty to examine every question solely on the ground of right and wrong. 
 
 In this country, that party will keep longest in possession of povyer, which 
 shall do right, and administer justice regardless of all other considerations. 
 1 hope all my efforts have heretofore tended to produce these ends. It has 
 been at all times my object to search out right; and vigilantly to pursue it, 
 regardless of incidental consequences. Influenced solely by these considera- 
 tions, I have endeavored to give this subject the most impartial investigation. 
 I have done so, with the most respectful attention to the motives and reason- 
 ings of other gentlemen. I knovy that I stand much in need of the same liber- 
 ality and indulgence myself, which, I hope, and doubt not, I shall receive in 
 return. 
 
 FEBRUARY 15, 1811. 
 
 Motion to strike out the first section depending. 
 Mr. CLAY spoke in favor of the motion, and Mr. POPE against it. 
 
 Mr. CLAY. Mr. President: When the subject involved in the motion now 
 under consideration was depending before the other branch of the Legislature, 
 a disposition to acquiesce in their decision was evinced: for, although the 
 
ON THE BILL TO RENEW THE CHARTER OF 1791, 353 
 
 Committee who reported this bill had been raided many weeks prior to the de- 
 termination of that House on the proposition tore-charter the bank, except 
 the occasional reference to it of memorials and petitions, we .scarcely ever 
 heard of it. The rejection, it is true, of a measure brought before either branch 
 of Congress, does not absolutely preclude the other from taking up the same 
 proposition; but the economy of our time, and a just deference for tlte opinion 
 of others, would seem to recommend a delicate and cautious exercise ot this 
 power. As this subject, at the memorable period when the charter was grant- 
 ed, called forth the best talents of the nation; as it has, on various occasions, 
 undergone the most thorough investigation; and as we can hardly expect that 
 it is susceptible of receiving any further elucidation; it was to have been hoped 
 that we should have been spared an useless debate. This was the more desir- 
 able, because there are, I conceive, much superior claims upon us for every 
 hour of the small portion of the session yet remaining to us. Under the opera- 
 tion of these motives. I had resolved to give a silent vote, until J feJt mysell 
 bou ad, by tbe defying manner of the arguments advanced in support ot the 
 renewal, to obey the paramount duties I owe my country and its constitution, 
 to make one effort, however feeble, to avert the passage of what appears to me 
 a most unjustifiable law. After my honorable friend from Virginia (Mr. 
 GILES) had instructed and amused us with the very able and ingenious argument 
 which he delivered on yesterday, 1 should have still forborne to tresspas* on 
 the Senate, but for the extraordinary character of his speech. lie discussee) 
 both sides of the question with great ability and eloquence, and certainly de- 
 monstrated, to the satisfaction of all who heard him, both that it was constitu- 
 tional and unconstitutional, highly proper and improper to prolong the charter 
 of the bank. The honorable gentleman appeared to me in the predicament in 
 which the celebrated orator of Virginia, Patrick Henry, is said to have been 
 once placed- Engaged in a most extensive and lucrative practice of the law. 
 he mistook in one instance the side of the cause on which he was retained, 
 and addressed the court and jury in a very spl ended and convincing speech in 
 behalf of his antagonist. His distracted client came up to him whilst he was 
 progressing*, and interrupting him, bitterly exclaimed, <k You have undone me! 
 You have ruined me!" "Never mind: give yourself no concern, said the 
 adroit advocate;" and turning to the court and jury, continued his argument, 
 by observing, "May it please your honors, and you, gentlemen of the jury. I 
 have been stating to you what 1 presume my adversary may urge on his side. 
 1 will uow show you how fallacious his reasoning and groundless his preten- 
 sions are." The skilful orator proceeded, satisfactorily refuted every argu- 
 ment he had advanced, and gained his cause! A success with which I trust 
 the exertions of my honorable friend will on this occasion be crowned. 
 
 It has been said by the honorable gentleman from Georgia, (Mr, CRAW- 
 FORD) that this has been made a party question, although the law incorporat- 
 ing the bank was passed prior to the formation of parties, and when Congress 
 was not biassed by party prejudices, [Mr, CRAWFORD explained. He did 
 not mean that it had been made a party question in the Senate. His allusion 
 was elsewhere.] 1 do not think it altogether fair to refer to the discussions 
 in the House of Representatives, as gentlemen belonging to that body have 
 no opportunity of defending themselves here. It is true that this law vvas not 
 the effect, but it is no less true that it was one of the causes of the political 
 divisions in this country. And, if, during the agitation of the present ques- 
 tion, the renewal has, on one side, been opposed on party principles, let me 
 ask if, on the other, it has not been advocated on similar principles? Where 
 is the Macedonian phalanx the opposition in Congress? 1 believe, sir, 1 shall 
 not incur the charge of presumptuous prophecy, when I predict that we shall 
 not pick up from " 
 worthy friend f 
 kind in him to 
 fidelity with which they adhere to their old principle 
 
 1 shall not stop to examine how far a representative is bound by the instruc- 
 tions of his constituents. That is a question between the giver and receiver 
 45 
 
354 BANK OF THE UNITED STATES. 
 
 ot the instructions. But I must be permitted to express my surprise at the 
 pointed difference which has been made between the opinions and instruc- 
 tions of State Legislatures, and the opinions and details of the deputa- 
 tions with which we have been surrounded from Philadelphia. Whilst 
 the resolutions of those Legislatures known, legitimate, constitutional, and 
 deliberative bodies have been thrown into the back ground, and their inter- 
 ference regarded as officious, these delegations from self-created societies, 
 composed of whom no body knows, have been received by the committee 
 with the utmost complaisance. Their communications have been treasured 
 up with the greatest diligence. Never did the Delphic priests collect with 
 more holy care the frantic expressions of the agitated Pythia, or expound 
 them with more solemnity to the astonished Grecians, than has the committee 
 gathered the opinions and testimony of these deputies, and, through the gen- 
 tleman from Masschusetts. pompously detailed them to the Senate! Phila- 
 delphia has her immediate representatives, capable of expressing her wishes 
 upon the floor of the other House. If it be improper for States to obtrude 
 upon Congress their sentiments, it is much more highly so for the unauthor- 
 ized deputies of fortuitous congregations. 
 
 The first singular feature that attracts attention in this bill is, the new and 
 unconstitutional veto which it establishes. The constitution has required 
 only, that, after bills have passed the House of Representatives and the Se- 
 nate, they shall be presented to the President for his approval or rejection, 
 and his determination is to be made known in ten days. But this bill pro- 
 vides, that, when all the constitutional sanctions are obtained, and when, ac- 
 cording to the usual routine of legislation, it ought to be considered as a law, it 
 is to be submitted to a new branch of the Legislature, consisting of the Presi- 
 dent and twenty-four Directors of the Bank of the United States, holding 
 their sessions in Philadelphia, and if they please to approve it, why then, it 
 is to become a tawl And three months (the term allowed by our law of May 
 last, to one of the great belligerents for revoking his edicts, after the other 
 shall have repealed his) are granted them to decide , whether an act of Con- 
 gress shall be the law of the land or not! An act which is said to be indis- 
 pensably necessary to our salvation, and without the passage of which, uni- 
 versal distress and bankruptcy are to pervade the country. Remember, sir, 
 that the honorable gentleman from Georgia has contended that this charter is 
 no contract. Does it then become the Representatives of the nation to leave 
 the nation at the mercy of a corporation? Ought the impending calamities to 
 be left to the hazard of a contingent remedy? 
 
 / This vagrant power to erect a bank, after having wandered throughout the 
 / whole constitution in quest of some congenial spot whereupon to fasten, has 
 / been at length located, by the gentleman from Georgia, on that provision which 
 / authorizes Congress to lay and collect taxes, &c. In 1791, the power is 
 l referred to one part of the instrument; in 1811, to another. Sometimes it is 
 \ alleged to be deducible from the power to regulate commerce. Hard pressed, 
 \ here, it disappears and shows itself under the grant to coin money. The saga- 
 cious Secretary of the Treasury, in 1791, pursued the wisest course; he has 
 taken shelter behind general high sounding and imposing terms. He has de- 
 clared, in the preamble to the act establishing the bank, that it will be very 
 conducive to the sucsessful conducting of the national finances; will tend to 
 give facility to the obtaining of loans; and will be productive of considerable 
 advantage to trade and industry in general. No allusion is made to the col- 
 lection of taxes. What is the nature of this Government? It is emphatically 
 federal vested with an aggregate of specified powers for general purposes, 
 conceded by existing sovereignties, who have themselves retained what;is not 
 
 (so conceded. It is said, that there are cases in which it must act on implied 
 powers. This is not controverted, but the implication must be necessary, 
 and obviously flow from the enumerated power with which it is allied. The 
 power to charter companies is not specified in the grant, and I contend, is of 
 a nature not transferable by mere implication. It is one of the most exalted 
 attributes of sovereignty. In the exercise of this gigantic power, \ye have 
 seen an East India company created, which has carried dismay, desolation, and 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 355 
 
 death, throughout one of tiie largest portions of the habitable world. A com- 
 pany which is, in itself, a sovereignty; which has subverted empires and set 
 up new dynasties; and has not only made war, but war against its legitimate 
 sovereign! Under the influence of this power, we have seen arise a South 
 Sea company and a Mississippi company, that distracted and convulsed all 
 Europe, and menaced a total overthrow of all credit and confidence, and uni- 
 versal bankruptcy. Is it to be imagined that a power so vast would have been 
 left by the wisdom of the constitution to doubtful inference? It has been 
 alleged that there are many instances in the constitution, where powers, in 
 their nature incidental, and which would have necessarily been vested along 
 with the principal power, are, nevertheless, expressly enumerated: and the 
 power " to make rules and regulations for the government of the land and 
 naval forces," which, it is said, is incidental to the power to raise armies and 
 provide a navy, is given as an example. What does* this prove? IIow ex- 
 tremely cautious the convention were, to leave as little as possible to implica- 
 tion! In all cases where incidental powers are acted upon, the principal and 
 incidental ought to be congenial witn each other, and partake of a common 
 nature. The incidental power ought to be strictly subordinate and limited to 
 the end proposed to be attained by the specified power. In other words, under 
 the name of accomplishing one object which is specified, the power implied 
 ought not to be made to embrace other objects, which are not specified in the 
 constitution. If, then, you could establish a bank to collect and distribute 
 the revenue, it ought to be expressly restricted to the purpose of such collec- 
 tion and distribution. It is mockery, worse than usurpation, to establish it 
 for a lawful object, and then extend it to other object-, which are not lawful. 
 In deducing the power to create corporations, such as I have described it, 
 from the power to collect taxes, the relation and condition of principal and 
 incident are prostrated and destroyed. The accessory is exalted above the 
 principal. As well might it be said, that the great luminary of day is an ac- 
 cessory a sattelite to the humblest star that twinkles forth its feeble light in 
 the firmament of Heaven ! 
 
 Suppose the constitution had been silent as to an individual department of 
 this Government, could you, under the povver to lay and collect taxes, esta- 
 blish a judiciary? I presume not. But, if you could derive the power by 
 mere implication, could you vest it with any other authority, than to enforce 
 the collection of the revenue? A bank is made for the ostensible purpose of 
 aiding in the collection of the revenue, and whilst it is engaged in this, the 
 most inferior and subordinate of all its functions, it is made to diffuse itself 
 throughout society, and to influence all the great operations of credit, circu- 
 lation, and commerce. Like the Virginia justice, you tell the man whose 
 turkey had been stolen, that your book of precedents furnishes no form for 
 his case; but, then, you will grant him a precept to search for a cow, and 
 when looking for that, he may possibly find his turkey! You say to this cor- 
 poration, we cannot authorize you to discount, to emit paper, to regulate com- 
 merce, &c. No. Our book has no precedents ot that kind. But, then, we 
 can authorize you to collect the revenue, and whilst occupied with that, you 
 may do vyhatever else you please. 
 
 What is a corporation, such as the bill contemplates? It is a splendid asso- 
 ciation of favored individuals, taken from the mass of society, and invested 
 with exemptions and surrounded by immunities and privileges. The honora- 
 ble gentleman from Massachusetts, (Mr. LLOYD) has said, that the original 
 law, establishing the bank, was justly liable to the object ion of vesting, in 
 that institution, an exclusive privilege, the faith of the Government being 
 pledged that no other bank should be authorized during its existence. This 
 objection he supposes is obviated by the bill under consideration. But all 
 corporations enjoy exclusive privileges; that is, the corporators have privileges 
 which no others possess. And if you create fifty corporations instead of one, 
 y^ou have only fifty privileged bodies instead of one. 1 contend that the 
 States have the exclusive power to regulate contracts, to declare the capacities 
 and incapacities to contrac f, and to provide as to the extent of responsibility of 
 
356 BANK OF THE UNITED STATES. 
 
 debtors to their creditors. If Congress have the power toerect an artificial body, 
 and say it shall be endowed with the attributes of an individual; if you can 
 bestow on this object of your own creation the ability to contract? may you 
 not, in contravention of State lights, confer upon slaves, infants, and femmes 
 covert, the ability to contract? And if you have the power to say that an 
 association of individuals shall be responsible for their ciebts, only in a certain 
 limited degree, what is to prevent an extension of a similar exemption to indi- 
 viduals? Where is the limitation upon this power to set up corporations? 
 you establish one, in the heart of a State, the basis of whose capital is money. 
 You may erect others whose capital shall consist of land , slaves, and personal 
 estate,, and thus the whole property within the jurisdiction of a State might 
 be absorbed by these political bodies. The existing bank contends, that it is 
 beyond the power of a State to tax itf and it this pretension be well founded, 
 it is in the power of Congress, by chartering companies, to dry up the whole 
 of the sources of State revenue. Georgia has undertaken 9 it is true, to levy 
 a tax on the branch within her jurisdiction, but this law, now under a course 
 of litigation, is considered as invalid. The United States own a great deal of 
 land in the State of Ohio; can this Government, for the purpose of creating 
 an ability to purchase it, charter a company? Aliens are forbidden, I believe, 
 in that State, to hold real estate; could you^ in order to multiply purchasers, 
 confer upon them the capacity to hold land, in derogation of the local law? 1 
 imagine this will hardly be insisted upon; and vet, there exists a more obvious 
 connexion between the undoubted power which is possessed by_ this Govern- 
 ment to sell its land and the means of executing that power by increasing the 
 demand in the market, than there is between this bank and the collection of a 
 tax. This Government has the power to- levy taxes, to raise armies, provide a 
 navy, make war, regulate commerce, coin money, &c.&c. It would not be 
 difficult to show as intimate a connexion between a corporation established for 
 any purpose whatever, and some one or other of those great powers, a& there 
 is between the revenue and the Bank of the United States, 
 
 Let us inquire into the actual participation of this bank in the collection of 
 the revenue. Prior to the passage of the act of 1800, requiring the collectors 
 of those ports of entry, at which the principal bank or any of its offices are situ- 
 ated, to deposite with them the custom house bonds, it had not the smallest 
 agency in the collection of the duties. During almost one moiety of the pe- 
 riod to which the existence of this institution was limited, it was nowise in- 
 strumental in the collection of that revenue, to which it is now become indis- 
 pensable! The collection, previous to 1800, was made entirely by the collec- 
 tors; and even at present, where there is one port of entry, at which this bank 
 is employed, there are eight or ten at which the collection is made as it was 
 before 1800. And, sir, what does this bank or its branches, when resort is 
 had to it? It does not adjust with the merchant the amount of the duty, nor 
 take his bond; nor, if the bond is not paid, coerce the payment, by distress or 
 otherwise. In fact, it has no active agency whatever in the collection. Its 
 operation, is merely passive; that is, if the obligor, after his bond is placed 
 in the bank, discharges it, all is very well. Such is the mighty aid afforded 
 by this tax-gatherer, without which the Government cannot get along! Again, 
 it is not pretended that the very limited assistance which this institution does, 
 in truth, render, extends to any other than a single species of tax that is, du- 
 ties. In the collection of the excise, the direct, and other internal taxes, no aid 
 was derived from any bank. It istrue, in thecollection of those taxes, the farmer 
 did not obtain the sameindulgence which the merchant receives in payingduties. 
 But what obliges Congress to give credit to all? Could it not demancf prompt 
 payment of the duties? And, in fact, does it not so demand, in many instances? 
 Whether credit is given or not, is a matter merely of discretion. If it be a facility 
 to mercantile operations, (as I presume it is) it ought to be granted. But I de- 
 ny the right to engraft upon it a bank, which you would not otherwise have the 
 power to erect. You cannot create the necessity of a bank, and then plead that 
 necessity for its establishment. In the administration of the finances, the bank 
 acts simply as a payer and receiver. The Secretary of the Treasury has mo- 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 357 
 
 ney in Ne\y York, and wants it in Charleston; the bank will furnish him with a 
 check, or bill, to make the remittance, whichany merchant woulddojustas well. 
 
 I will now proceed to show, by fact, actual experience, not theoretic reason- 
 ing, but by the records themselves of the treasury, that the operations of that 
 department may be as well conducted without, as with this bank. The delu- 
 sion has consisted in the use of certain high sounding phrases, dexterously used 
 on the occasion. " The collection of the revenue;" "the administration of the 
 finance;" " the conducting the fiscal affairs of the Government;" the usual 
 language of the advocates of the bank; extort express assent, or awe into 
 acquiescence, without inquiry or examination into its necessity. About the 
 commencement of this year, there appears, by the report of the Secretary of 
 the Treasury, of the 7th January, to have been a little upwards of two mil- 
 lions four hundred^thpusand dollars in the treasury of the United States; 
 and more than one-third of this whole sum was in the vaults of local banks. 
 In several instances, where an opportunity existed of selecting the bank, a 
 preference has been given to the State bank, or, at least, a portion of the de- 
 posites has been made with it, In New York, for example, there was deposit- 
 ed with the Manhattan Bank $188,670, although a branch bank is in that city. 
 In this District, $115,OSOwere deposited with the Bank of Columbia, although 
 here, also, is a branch bank; and yet the State banks are utterly unsafe to be 
 trusted! If the money, after the bonds are collected, is thus placed with these 
 banks, I presume there can be no difficulty in placing the bonds themselves 
 there, if they must be deposited witli some bank for collection, which I deny. 
 
 Again, one of the most important and complicated branches of the Treasury 
 Department is the management of our landed system. The sales have, some 
 years, amounted to upwards of half a million of dollars; are generally made 
 upon credit: and yet no bank whatever is made use of to facilitate the collec- 
 tion. After it is made, the amount, in some instances, has been deposited 
 with banks, and, according to the Secretary's report, which I have before ad- 
 verted to, the amount so deposited was, in January, upwards of $300,000, not 
 one cent of which was in the vaults of the Bank of the United States, or in 
 any of its branches, but in the Bank of Pennsylvania, its branch at Pittsburg, 
 the Marietta Bank, and the Kentucky Bank. Upon the point of responsibility, 
 I cannot subscribe to the opinion of the Secretary ot the Treasury, if it is 
 meant that the ability to pay the amount of any deposites which the Govern- 
 ment may make, under any exigency, is greater than that of the State banks. 
 That the flecoiM/o&tVtft/ of a ramified institution, whose affairs are managed by 
 a single head, responsible for all its members, is more simple than that of a 
 number of independent and unconnected establishments, I shall not deny; but, 
 with regard to safety, I am strongly inclined to think it is on the side of the 
 local banks. The corruption or misconduct of the parent, or any of its branch- 
 es, may bankrupt or destroy the whole system, and the loss of the Govern- 
 ment, in that event, will be of the deposites made with each; whereas, in the 
 failure of one State bank, the loss will be confined to thedeposite in the vaults 
 of that bank. It is said to have been a part of Burr's plan, to seize on the 
 branch bank at New Orleans. At that period, large sums, imported from La 
 Vera Crux, are alleged to have been depositecl with it, and if the traitor had 
 accomplished his design, the Bank of the United States, if not actually bank- 
 rupt, might have been constrained to stop payment. 
 
 It is urged by the gentleman from Massachusetts (Mr. LLOYD) that as this 
 nation progresses in commerce, wealth, and population, new energies will be 
 unfolded, new wants and exigencies will arise, and hence he infers that pow- 
 ers must be implied from the constitution. But, sir, the question is, shall we 
 stretch the instrument to embrace cases not fairly within its scope, or shall we 
 resort to that remedy, by amendment, which the constitution prescribes ? 
 
 Gentlemen contend that the construction which they give to the constitu 
 tion has been acquiesced in by all parties and under all administrations; and 
 they rely particularly on an act which passed in 1804, for extending a branch 
 to New Orleans, and anotheract, of 1807, for punishing those who :-hould forge 
 or utter forged paper of the bank. With regard to the first law. passed no 
 
358 BANK OF THE UNITED STATES. 
 
 doubt upon the reccommendation of the Treasury Department, I would re- 
 mark, that it was the extension of a branch to a territory over which Congress 
 possesses power of legislation almost uncontrolled, and where, without any 
 constitutional impediment, charters of incorporation may be granted. As to 
 the other act, it was passed no less for the benefit of the community than the 
 bank to protect the ignorant and unwary from counterfeit paper, purporting 
 to have been emitted by the bank. When gentlemen are claiming the advan- 
 tage supposed to be deducible from acquiescence, let me inquire what they 
 would have had those to have done, who believed the establishment of the 
 bank an encroachment upon State rights ? Were they to have resisted, and 
 how ? By force ? Upon the change of parties in 1800 it must be well reccol- 
 lected that the greatest calamities were predicted as consequences of that 
 event. Intentions were ascribed to the new occupants of power of violating 
 the public faith, and prostrating national credit. Under such circumstances, 
 that they should act with great circumspection, was quite natural. They saw 
 in full operation a J>ank, chartered by a Congress who had as much right to 
 judge of their constitutional powers as their successors. Had they revoked 
 the law which gave it existence, the institution would, in all probability, have 
 continued to transact business notwithstanding. The judiciary would have 
 been appealed to, and, from the known opinions and predilections of the jud- 
 ges then composing it, they would have pronounced the act of incorporation 
 as in the nature of a contract, beyond the repealing power of any succeeding 
 Legislature. And, sir, what a scene of confusion would such a state of things 
 have presented an act of Congress, which was law in the statute book, and 
 a nullity on the judicial records ! Was it not wisest to wait the natural dis- 
 solution of the corporation, rather than accelerate that event by a repealing 
 law, involving so many delicate considerations ? 
 
 When gentlemen attempt to carry this measure upon the ground of acqui- 
 escence or precedent, do they forget that \ve are not in Westminster Hall ? 
 In courts of justice, the utility of uniformity of decision exacts of the judge 
 a conformity to the adjudication of his predecessor. In the interpretation and 
 administration of the law this practice is wise and proper, and without it, eve- 
 ry thing depending upon the caprice of the judge, we should have no security 
 for our dearest rights. It is far otherwise when applied to the source of legis- 
 lation. Here no rule exists but the constitution; and to legislate upon the 
 ground merely that our predecessors thought themselves authorized, under 
 similar circumstances, to legislate, is to sanctify error and perpetuate usur- 
 pation. But, if we are to be subjected to the trammels of precedents, I claim, 
 on the other hand, the benefit of the restrictions under which the intelligent 
 judge cautiously receives them. It is an established rule that, to give to a pre- 
 vious adjudication any effect, the mind of the judge who pronounced it must 
 have been awakened to the subject, and it must have been a deliberate opin- 
 ion formed after full argument. In technical language, it must not have been 
 sub silentio. Now, the acts of 1804 and 1807, relied upon as pledges for 
 the rechartering this company, passed not only without any discussions what- 
 ever of the constitutional power of Congress to establish a bank, but, I ven- 
 ture to say, without a single member having had his attention drawn to this 
 question. I had the honor of a seat in the Senate when the latter law passed, 
 probably voted for it; and I declare, with the utmost sincerity, that I never 
 once thought of that point, and I appeal confidently to every honorable mem- 
 ber who was then present to say if that was not his situation. 
 
 This doctrine of precedents, applied to the Legislature, appears to me to be 
 fraught with the most mischievous consequences. The great advantage of 
 our system of government, over all others, is, that we have a written constitu- 
 tion, defining its limits, and prescribing its authorities; and that, however, for 
 a time, faction may convulse the nation, and passion and party prejudice 
 sway its functionaries, the season of reflection will recur, when, calmly retrac- 
 ing their deeds, all aberrations from fundamental principle will be corrected. 
 But once substitute practice for principle; the expositions of the constitution 
 for the text of the constitution; and in vain shall we look for the instrument 
 
ON THE BILL TO RENEW I HE CHAHTEK OF 1791. 359 
 
 in the instrument itself! It will be as diffused and intangible as the pretend- 
 ed constitution of England. And it must be sought for in the statute book, 
 in the fugitive journals of Congress, and in reports of the Secretary of the 
 Treasury! What would be our condition if we were to take the interpreta- 
 tions given to that sacred book, which is, or ought to be, the criterion of our 
 faith, for the book itself ? We should find the holy bible buried beneath the 
 interpretations, glosses, and comments, of councils, synods, and learned di- 
 vines, which have produced swarms of intolerant and furious sects, partaking 
 less of the mildness and meekness of their origin than of a vindictive spirit of 
 hostility towards each other! They ought to afford us a solemn warning to 
 make that constitution, which we have sworn to support, our invariable guide. 
 
 1 conceive, then, sir, that we are not empowered, by the constitution, nor 
 bound by any practice under it, to renew the charter of this bank: and I might 
 here rest the argument. But, as there are strong objections to the renewal 
 upon the score of expediency, and as the distresses which will atend the dis- 
 solution of the bank have been greatly exaggerared, I will ask your indul- 
 gence for a few moments longer. That some temporary inconvenience will 
 arise, I shall nut deny; but mostgroundlessly have the recent failures in New 
 York been attributed to the discontinuance of this bank. As well might you 
 ascribe to that cause the failures of Amsterdam and Hamburg, of London and 
 Liverpool. The embarrassments of commerce the sequestration in France 
 the Danish captures in fine, the belligerent edicts, are the obvious sources 
 of these failures. Their immediate cause is the return of bills upon London, 
 drawn upon the faith of unproductive or unprofitable shipments. Yes, sir, 
 the protests of the notaries of London, not those of New York, have oc- 
 casioned these bankrupticies. 
 
 The power of a nation is said to consist in the sword and the purse. Perhaps, 
 at last, all power is resolvable into that of the purse: for, with it, you may com- 
 mand almost every thing else. The specie circulation of the United States is 
 estimated by some calculators at ten millions ol dollars; and if it be no more* 
 one moiety is in the vaults of this bank. May not the time arrive when the 
 concentration of such a vast portion of the circulating medium of the country 
 in the hands of any corporation, will be dangerous to our liberties? By whom 
 is this immense power wielded? By a body, who, in derogation of tne great 
 principle of all our institutions responsibility to the People is amenable only 
 to a few stockholders, and they chiefly foreigners. Suppose an attempt to 
 subvert this Government would not the traitor first aim, by force or corrup- 
 tion, to acquire the treasure of this company? Look at it in another aspect. 
 Seven-tenths of its capital are in the hands of foreigners, and these foreigners 
 chiefly English subjects. We are possibly upon the eve of a rupture with that 
 nation. Should such an event occur, do you apprehend that the English pre- 
 mier would experience any difficulty in obtaining the entire control of this 
 institution? Republics, above all "other nations, ought most studioufly to 
 guard against foreign influence. All history proves that the internal dissen- 
 sions, excited by foreign intrigue, have produced the downfalof almost every 
 free government that has hitherto existed; and yet gentlemen contend that we 
 are benefitted by the possession of this foreign capital! If we could have its 
 use, without its attending abuse, I should be gratified, also. But it is in vain 
 to expect the one without the other. Wealth is power, and, under whatso- 
 ever form it exists, its proprietor, whether he lives on this or the other side of 
 the Atlantic, will have a proportionate influence. It is argued that our pos- 
 session of this English capital gives us certain influence over the British Go- 
 ernment. If this reasoning be sound, we had better revoke the interdiction 
 as to aliens holding land, and invite foreigners to engross the whole property, 
 real and personal, of the country. We had better at once exchange the condi- 
 tion of independent proprietors for that of stewards. We should then be able 
 to govern foreign nations, according to the arguments of gentlemen on the 
 other side. But let us put aside this theory, and appeal to the decisions of ex- 
 perience. Go to the other side of the Atlantic, and see what has been achieved 
 for us there, by Englishmen, holding seven-tenths of the capital of this bank. 
 
380 BANK OF THE UNITED STATES 
 
 Has it released from galling and ignominious bondage one solitary American 
 seaman, bleeding under British oppression? Did it prevent the unmanly at- 
 tack upon the Chesapeake? Did it arrest the promulgation, or has it abro- 
 gated the orders in council those orders which have given birth to a new era 
 in commerce? In spite of all its boasted effect, are not the two nations brought 
 to the very brink of war? Are we quite sure, that, on this side of the water, 
 it has had no effect favorable to British interests? It has often been stated, 
 and although I dp not know that it is susceptible of strict proof, I believe it to 
 be a fact, that this bank exercised its influence in support of Jay's treaty; and 
 may it not have contributed to blunt the public sentiment, or paralyse the ef- 
 forts of this nation against British aggression? 
 
 The duke ol Northumberland is said to be the most considerable stockhold- 
 er in the Bank of the United States. A late lord chancellor of England, 
 besides other noblemen, was a large stockholder. Suppose the prince of Es- 
 sling, the duke of Cadore, and other French dignitaries, owned seven-eighths 
 of the capital of this bank, should we witness the same exertions (I allude not 
 to any made in the Senate) to re-charter it? So far from it, would not the dan- 
 ger of French influence be resounded throughout the nation? 
 
 I shall give my most hearty assent to the motion for striking out the first sec- 
 tion of the bill. 
 
 Mr. POPK. Mr. President: In rising, on this occasion, I never more en- 
 tirely obeyed both my feelings and my judgment. The principle involved in 
 the decision about to be given, is, in my view, of more magnitude than any which 
 has been presented for our consideration, since I had the honor of a seat 
 here. It is no less than whether we shall surrender to the State Govern- 
 ments the power of collecting our revenue, and rely upon the old system'of re- 
 quisitions. We are called upon to return to that state of imbecility and chaos 
 from which this political fabric was reared, by the wisdom and patriotism of 
 the first statesmen of which any age t>r nation can boast. For twenty years we 
 have collected our revenue, borrowed money, paid our debts, and managed our 
 fiscal concerns, through the agency of a national bank. That it has answered 
 the most sanguine expectations of its authors; that it has been well managed; 
 is admitted by the most decided opponents to the renewal of the charter. 
 Although, in public debate, in newspapers, courtyards, muster fields, &c. 
 we have heard much of dangerous powers, violations of the constitution, 
 British influence, and poisonous vipers, &c. which were to sting to death the 
 liberties of the People, yet we find ourselves as free almost as the air we breathe, 
 and hardly subservient to the mildest code of laws by which any nation was 
 ever governed. In the city of Philadelphia, and the state of Pennsylvania 
 generally, where these animals called banks* have grown to the most enor- 
 mous size, we find as sound morals, and as much real practical republicanism, 
 as in those parts of the Union where the rattling of this viper's tail has never 
 been heard; and, in point of solid wealth and internal improvements, mark 
 the contrast. We are required to disregard the lessons of that best teacher, 
 experience, and to try some new scheme. However captivating new theories 
 and abstract propositions were, a few years since, I believe the thinking men 
 of all parties in the nation are perfectly convinced that one ounce of experience 
 and common matter of fact sense is worth more, for the purposes of legislation, 
 than a ship load of theory and speculation. We are told that we musttorce into 
 the vaults of the bank a large portion of the circulating medium, and thereby 
 depress the price of every thing in the market; we must give a shock to credit 
 of every kind; check and embarrass every branch of agricultural, commercial, 
 and manufacturing industry; give up the young mechanics, manufacturers, and 
 merchants, with small capitals, a prey to the cupidity of moneyed men, who will 
 be tempted to withdraw their funds from trade, to speculate on the wrecks of 
 the unfortunate. This is not mere matter of calculation. I only state facts 
 proved to us by the most unquestionable evidence. We are not only, sir, to 
 ruin many innocent and unoffending individuals, but to derange the national 
 finances. And for what is all this to be done ? To promote the public good, or 
 
ON THE BILL TO RENEW THE CHAHTER OF 1791. 
 
 advance the national prosperity r No, sir, it is not pretended. We arc grave* 
 ly told that \ve, the Representatives of the People, must sacrifice the People to 
 save the constitution of the People, whose happiness and welfare it was intend- 
 ed to secure. If this be true, it is indeed a strange government under which 
 we live. I advance the opinion with confidence, that no principle which, in 
 its pratical effects, outrages the common sense and feelings of mankind, can 
 be a sound one, and we ought to examine it well, and hesitate much before 
 we give our assent. To bring distress on the country, not to prevent a 
 violation of any positive provision of the constitution, but to correct what we 
 suppose to have been an erroneous construction of it by our predecessors, of 
 which neither the States or the People have ever complained, appears to me 
 more nice than wise. 
 
 Disguise this question as you will, sir, and still it will clearly appear to be a 
 contest between a few importing States and the People of the United States. 
 Resolutions have been already laid on our table by gentlemen from the two 
 large States; from which instructions have been received in substance, re- 
 quiring Congress to give wp to the State banks the collection of the national re- 
 venue. I am, Mr. President, on the side of the People of the United States. 
 This is, indeed, a question of party, but of a very different character from (hat 
 which will be attempted to be palmed on the People. It is a contest between 
 the friends and enemies of the federal constitution, revived: for, if I am not 
 mistaken, the power of laying and collecting imposts and duties was strongly 
 objected to by some of the large States, having advantageous sea ports, before 
 the constitution was adopted. I am for preserving both the States and the 
 Union. I consider the safety and independence of the several States, and 
 the liberties of the People, inseparably connected with, and dependent on, the 
 efficiency of the National Government; and it is to me unaccountable that 
 gentlemen in favor of strong measures against foreign nations should be so 
 solicitous to strip the General Government of this very essential part of its 
 power. We were told, a few days since, that our army was so insignificant and 
 contemptible, that it would require a constable with a search warrant to find it. 
 I have heard another gentleman, of very high standing, suggest the propriety 
 of retroceding the ten miles square to the States of Virginia and Mary- 
 land. Our gun boats are almost rotten. We have not more frigates and 
 other armed vessels than sufficient to carry our ministers and diplomatic 
 despaches to foreign courts; and if we yield to the States the collection of our 
 revenue, what will remain of the Federal Government with which the People 
 can indentify their feelings or affections? In what will this Government con- 
 sist? It will be a mere creature of the imagination a political fiction. And, 
 analogous to the fiction in the action of ejectment, we shall have to suppose 
 its existence, and then bottom our proceedings upon that supposition. If I was 
 hostile to our Federal Union, or wanted to prepare the public mind for a 
 surrender of this happy system of government, I would join in the hue and 
 cry against this institution; I would support every measure calculated to 
 destroy all confidence in, and respect for, this Government, both at honie and 
 abroad; I would endeavor to produce, throughout the country, confusion and 
 disorder, and a state of glorious uncertainty; then persuade the People to seek 
 security and tranquillity under some other form of government The transition, 
 from a wild, factious democracy, to despotism, is often easy, and generally 
 sudden. The extremes are very nearly allied. A republican Government, 
 
 fuided by the virtue and intelligence of a nation, is the first of human blessings; 
 ut, when directed by the angry vindictive passions of party, the worst of 
 which the imagination can conceive. A republic, to be durable, must inspire 
 confidence and respect. Such instability, such variable unsettled policy, as 
 now appears to be the order of the day, could not have been anticipated by 
 any man blessed with a tolerable degree of faith in the success of this great 
 republican experiment. Mr. President, I have ever been opposed to yielding 
 to the commercial interest an undue influence in this Government, but I am 
 unwilling to make an unnecessary and wanton attack upon them. Coming 
 from an agricultural State, I am not disposed to increase the jealousies which 
 46 
 
562 BANK OF THE UNITED STATES- 
 
 unfortunately exist, and thereby weaken the ties by which these States an? 
 held together. I am sensible, too, how much the prosperity of the State I 
 represent depends on a prosperous State of trade; and although the shock frc-n 
 the dissolution of this bank will be first felt in the commercial cities, it must 
 immediately react to the extremes of the empire. I know many are under an 
 impression that federalists and British agents are to be the victims; but very 
 different will be the result. I refer to the evidence detailed by the honorable 
 gentleman from Massachusetts, (Mr. LLOYD.) But is it possible that are 
 intolerant spirit of party has prepared us for this ? Are gentlemen ready to 
 
 - ~ \**\s ^VAV**!,-* kj wi iu*_s JLW T VI VI IIA/1J ^ 4^ UUfftLV'VI } JL 4AI41. v5 U. 1 C- y 
 
 by nobler views} when I see the professors of a religion which teaches 
 us to love our neighbors as ourselves; I cannot persuade myself that Christian 
 charity, and all the noble, generous feelings of the human heart, are extinguish- 
 by this demon, party spirit. If there be a man in the nation who can witness, 
 with -unfeeling apathy, the distresses of his fellow citizens, he would have 
 figured in Smithfield, in the bloody reign of Queen Mary of England, in 
 binding heretics to the stake, or in the sanguinary time of Robespierre, in 
 adding victims to the guillotine; but he is unworthy the blessings of a free 
 Government. 
 
 Sir, I address the Senate under circumstances discouraging indeed. I have 
 been told, and on this floor, that debate is useless; that no man's opinion i& 
 to be changed; that I shall find verified, in the decision of this question, the 
 sentiment contained in two lines of Hudibras: " He that is convinced against 
 his mil is of the same opinion still." I cannot admit this. I know there are 
 gentleman fully sensible of the evils about to befal their country, without any 
 obstinate pride to conquer, who would rejoice at being convinced it is in their 
 power to avert them. Let me intreat them to pause and reflect, before they 
 inflict a wound on their country's interest, under the influence of constitutional: 
 doubt; and if they err, I would ask them, would it not be more.saf e and patriotic 
 to err in' favor of the People? Permit me, now, sir, to redeem" this subject from, 
 the constitutional difficulties with which it has been encumbered. 
 
 To form a correct opinion, we must retrospect the defects of the old Go- 
 vernment, and ascertain the remedy which was anticipated in the present 
 constitution. I believe it will be conceded that the great cause of the ineffi- 
 ciency of the former was not because the principal field of legislation was too 
 limited, but was owing to its dependence on the States for the means to carry 
 their powers into effect.For the truth of this position I appeal to the history of 
 that day the candor of gentlemen who hear me. The present constitution 
 was framed for rational purposes, with am pie authority to pass all laws neces- 
 sary and proper for the attainment of its objects, independent of State authority, 
 except so far as expressly made dependent by the constitution. The erroneous 
 impressions with regard to this bank have arisen from ignorance of facts, relative 
 to the practical fiscal operations of the Government, and from confounding an 
 original independent power to establish banks and corporations with a necessary 
 auxiliary to the execution of the powers given. By the constitution it is ex- 
 pressly declared, that Congress shall have power to pass all laws necessary 
 and proper to carry into effect the powers previously enumerated, and all 
 other powers vested in the Government of the United States, or any depart- 
 ment or officer thereof. Our power to create a bank is not derived by impli- 
 cation. No, sir. If this express delegation of power had not been inserted* 
 we must have implied the authority to provide the means necessary and pro- 
 per, &c. 
 
 But the convention, with a full knowledge of the defects of the old confede- 
 ration, and deeply impressed with the necessity of an efficient national Go- 
 vernment, determined to exclude all doubt, by granting to the new Govern- 
 ment, in express and unequivocal language, ample authority to use all meansne- 
 cessary and proper for the attainment of the ends for which it was instituted. 
 Jf a man was requested to look at the constitution, and decide whether power 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 is given to Congress to create a bank or corporations generally, he would an- 
 swer in the negative- This would very naturally be me answer of most men, 
 upon the first blush of the constitution. It is not pretended that Congress 
 have power to create corporations, as an independent proposition. The author- 
 ity to establish a bank, or corporation, is only contended for so far as it can be 
 fairly considered as a necessary and proper auxiliary to the execution of the 
 powers granted by the constitution. The question of constitutionality depends 
 upon facts, dehors the instrument, of which we must be informed before we 
 decide, and which could not be ascertained before the attempt was made to 
 give motion and energy to this political machinery. If the tact be ascertained, 
 by the best evidence the nature of the subject affords, that a bank is necessary 
 and proper to effectuate the legitimate powers of Government, then our power 
 is express, and we need not resort to implication. To prove, to the satisfaction 
 of the Senate and the world, this material fact, will be my business, before I 
 request their assent to the position assumed, that Congress have an express 
 power to incorporate a bank. To do this it is indispensable that we should 
 understand the practical financial concerns of the Government, or have the 
 information of those who do. We appropriate money for fortifications, on the 
 report of our engineer, Colonel Williams, and for the capitol, &c. upon the 
 report of Mr. Latrobe. To know how much timber or other materials are 
 necessary for a ship or a house, you must understand the subject yourself, or 
 have the information of those who do. For myself, I am ready to admit that 
 I rely much upon the information and experience of others. To ignorant men, 
 and those who do not profess to be fully acquainted with the nature and ma- 
 nagement of the national finances, the following evidence is presented. The 
 
 utility and necessity of which was ascertained by the experience of that day. 
 It is worthy of remark, that they created a bank, under powers much more 
 limited than ours. That act was not passed precipitately, but was the result 
 of the most mature and deliberate consideration. I beg leave to read the 
 preamble of the law which contains the opinions of that Congress with regard 
 to the utility and necessity of a national bank. " Whereas Congress, on the 
 26th day of May last, did, from a conviction of the support which the finances 
 of the united States would receive from the establishment of a national bank, 
 approve a plan for such an institution, submitted to their consideration by 
 Robert Morris, Esq. and now lodged among the archives of Congress, and 
 did engage to promote the same by the most effectual means: And whereas 
 the subscription thereto is now filled, from an expectation of a charter of in- 
 corporation from Congress, the directors and president are appointed, and 
 application hath been made to Congress, by the said president and directors, 
 for an act of incorporation: And whereas the exigencies of the United States 
 render it indispensably necessary that such an act be immediately passed: 
 Be it therefore ordained," &c. This act passed on the 3 1st day of Decem- 
 ber, 1781. And here permit me to observe, that this national bank, styled 
 the IBank of North America, was not produced by British influence or party 
 spirit. No, sir, the little, slandering, intriguing partyism, of the present 
 moment, was unknown to the patriots of that awful period. They had no 
 party but their country; liberty and independence were their objects. Their 
 souls were fired with a noble, a generous enthusiasm, on which Heaven look- 
 ed down with pleasure. It appears, from the journals of the Congress of 1781, 
 that the members from every State were unanimous in favor of a national 
 bank, except Massachusetts, Pennsylvania, and Virginia; the two members 
 from Massachusetts voted against it, the two members from Pennsylvania 
 were divided; of the four from Virginia, Mr. Madison alone voted against it. 
 Here it is evident that, in the very infancy of our republic, before, indeed, it 
 could with propriety be said to be born, when every bosom glowed with en- 
 thusiasm for liberty and a pure disinterested patriotism, a national bank was 
 not thought that dangerous dreadful monster, which the very wise, and exclu- 
 
364 BANK OF THE UNITEO STATES. 
 
 sive patriots, of I&l I, are endeavoring to represent it to the American People, 
 And the construction givent to the grant of powers, in the articles of confede- 
 ration, by the Congress of 1781, is strong evidence of our right to establish a 
 bank, under a grant of powers much more ample, and with money concerns 
 vastly more extensive and complicated. 
 
 The next evidence I shall adduce, for the consideration of the Senate, is 
 the opinion of the late General Hamilton, appointed by President Washing- 
 ton the first Secretary of the Treasury; whose province and duty it was to 
 superintend the national finances. His attention was, therefore, particularly 
 directed to the subject, and, in a very able report to the first Congress, assem- 
 bled under the new constitution, he recommended a national bank. Although 
 opinions have been imputed to this gentleman, very foreign to my feelings and 
 notions about government, yet he has ever been acknowledged, by the candid 
 and liberal of all parties, one of the first of American statesmen. For rea- 
 sons, which it is unnecessary for me to assign, I will not press his opinion 
 upon the attention of the Senate, but will introduce other and perhaps less 
 exceptionable testimony. The Congress of 1791, which incorporated the 
 present bank, merits the highest regard. It was composed of the most en- 
 lightened and distinguished men in America, many of whom had been mem- 
 bers of the convention, and were fully apprized ot the defects of the old and 
 the objects of the new Government. A large majority of both branches voted 
 in favor of the bank. They were not divided on the question by party. Many, 
 who have continued with the republican party under every administration, 
 voted in favor of this bank. Although different speculative or abstract politi- 
 cal opinions were then entertained, yet the spirit and passion of party had not 
 diffused itself so generally through the nation as at a subsequent period. The 
 next authority in favor of this bank, and one which must, at all times, and on 
 all occasions, command the highest respect, is no less than our immortal 
 Washington. He was President of the United States in 1791, when this bank 
 law passed. After it had received the sanction of both branches of the Legis- 
 lature, with that circumspection and prudence which reg'ilated his conduct 
 through life, he consulted the able men who composed his cabinet council, on 
 the constitutional question; they differed in opinion; he heard their argu- 
 ments for and against the measure; and, after full consideration, approved 
 the law. I cannot vet, sir, take leave of this very important testimony in 
 favor of the bank. The opinion of our Washington has the strongest claim to 
 pur confidence. Let us pause, before we disregard his solemn advice. This 
 is the hero who led our armies to victory; this is the Washington, who, at the 
 close of our Revolutionary war, disbanded a disciplined army in the bosom of 
 the republic, and voluntarily exchanged the splendid robes and ensigns of 
 military power, for the plain, humble garb of a private citizen. This Wash- 
 ington, who continued an American, a republican in heart and in sentiment, 
 until summoned to the mansions of bliss; yes, sir, this illustrious departed 
 hero, this practical statesman, has solemnly declared to the American People, 
 that a national bank is a necessary and proper auxiliary to the execution of 
 the national powers. The last authority 1 shall particularly notice, in sup- 
 port of this institution, is the opinion of the present Secretary of the Treasury, 
 Mr. Gallatin. If this gentleman cannot boast of the military laurels which 
 have adorned the brows of the patriots I have mentioned, as a statesman and 
 faithful public servant, he stands inferior to none. Mr. Galiatin, from his 
 first appearance on the theatre of public life, has been considered, by all par- 
 ties, an able financier. At a very early period, the finances of the United 
 States became the subject of his particular attention and inquiry; the result 
 of which was a treatise, published in 1796, called ' Gallatin on the finances of 
 the United States,' in which he gives a decided opinion in favor of this bank. 
 I rely much on his opinion at that period, because it must have been the result 
 of conviction, and not 9f any party feeling or consideration, as he was then in 
 the minority, and continued in it until the administration changed. His re- 
 port to the Senate, during the last session of Mr. Jefferson's administration, 
 and his letter to the committee, show that time and experience, so far from 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 changing, have confirmed him in the opinion he first formed on the subject; 
 to which, I might add, every administration, and almost every man practically 
 acquainted with our money concerns. Is not this mass of evidence sufficient 
 to substantiate the facts upon the existence or non-existence of which the 
 constitutionality of this measure depends? I put the question to the candor 
 and good sense of gentlemen, whether they are not satisfied, in the language 
 of the constitution, that a national bank is necessary and proper to effectuate 
 the legitimate powers of the National Government? If they answer in the 
 negative, I can only say, he who will neither regard the suggestions of expe- 
 rience, nor believe the report of the great political disciples who have gone 
 before us, would not believe though one were to rise from the dead. And 
 what is the answer to all this out of doors? Why, that we are not to be 
 governed by the information or opinion of others, however well acquainted 
 with the subject: we are so self sufficient as to disregard the best lights which 
 can be presented to us. The cry is up to the hub. down with the bank, huzza 
 for the party! So long, Mr. President, as I shall be honored with a seat in 
 the Senate of the Union, I am determined to respect my station, and my own 
 feelings and character, too much, to be driven along by any such idle, ridicu- 
 lous clamor. 
 
 To all the high authority I have mentioned, in support of a national bank, 
 may be opposed the names of some great men of Virginia, who have, long 
 since, I hope, got rid of their errors and prejudices; among others will, pro- 
 bably, be mentioned the name of the present President, who voted against the 
 present bank, in 1791, and against the Bank of North America, in 1781. No 
 man has a higher respect than myself for his virtues and wisdom; but, I be- 
 lieve, it is not pretended that he ever was a practical financier. No State can 
 boast of more genius, eloquence, and talents, than Virginia; it will, however, 
 be conceded, that no People are more deficient in practical knowledge of 
 finance and the nature of moneyed institutions. Indeed, they were, a few 
 years since, frightened at the very name of a bank. As soon as they heard of 
 one, they began to write books, make speeches, and pass resolutions, to lay this 
 ghost of tyranny. It required all the eloquence of my honorable friend from 
 that State, (Mr. BRENT) to persuade the Legislature that the little bank of 
 Alexandria would not sweep away their liberties. The talents and boldness 
 with which he, on that occasion, assailed the prejudices of Virginia, instead of 
 injuring him, inspired the People with the highest confidence in his integrity 
 and firmness; since, however, they have become acquainted with this bank 
 animal, they find it perfectly harmless, and no People in the Union are more 
 disposed to foster it. 
 
 The People, in framing the constitution, have avowed the objects for which 
 it was created. They say in the preamble, " We, the People of the United 
 States, in order to form a more perfect union, establish justice, ensure domes- 
 tic tranquillity, provide for the common defence, promote the general wel- 
 fare, and secure the blessings of liberty to ourselves and our posterity, do 
 ordain and establish this constitution for the United States or America." 
 After declaring by whom, and in what manner, the legislative power shall be 
 exercised, the qualifications of the electors and elected, the terms, &c. for 
 which the Senators and Representatives shall be respectively chosen, and 
 making various other provisions relative to the legislative department, they 
 proceed to enumerate the principal cardinal powers granted to Congress; 
 among others, that the " Congress shall have power to lay and collect taxes, 
 duties, imposts, and excises, to pay the debts, and provide for the common 
 defence and general welfare of the United States; but all duties, imposts, and 
 excises, shall be uniform throughout the United States; to borrow money on 
 the credit of the United States; to regulate commerce with foreign nations, 
 and with the Indian tribes; to establish an uniform rule of naturalization, &c.; 
 to coin money; regulate the value thereof; to declare w r ar, &c.; to raise and 
 support armies, &c.; to raise and maintain a navy." 
 
 At the close of this catalogue, of what I shall call cardinal powers, they 
 have inserted the general provisions before noticed: "To make all laws ne- 
 
366 BANK OF THE UNITED STATES. 
 
 cessary and proper for carrying into effect the foregoing powers, and all other 
 powers vested by this constitution in the Government of the United States, 
 or in any department or officer thereof." This provision contains a general 
 authority as to the means necessary to carry into effect the national powers. 
 The convention could not foresee or define what laws, in the progress of the 
 Government, the varying circumstances of the nation might require, and there- 
 fore wisely submitted them to the discretion of Congress, to be exercised on 
 facts and circumstances, as they occurred. It has been said this discretion 
 may be abused; and so may every other power given to Congress,- the security 
 of the People against the abuse of this or any other power is their own virtue 
 and intelligence, and the responsibility of their public servants. The question, 
 on every law bottomed on this clause of the constitution, must be, whether it 
 is necessary and proper; or, in other words, fairly suited to, and well calculated 
 for, legitimate national objects; and, if it can be fairly considered necessary 
 and proper, and is not prohibited, then it is certainly within the pale of the 
 constitution. 
 
 The constitution may with propriety be compared to a ship, finished as to all 
 the substantial parts, before she is put to sea. The People have built the na- 
 tional vessel, directed in what manner the commanders are to be chosen, and 
 made it their duty to provide sails, rigging, sea stores, &c. necessary and pro- 
 per to enable her to perform the voyages for which she was destined; and 
 those appointed to navigate her are not only bound to provide what is neces- 
 sary and proper for those seas were temperate and gentle breezes are to be 
 met with, but fit her to encounter the most tempestuous seasons. 
 
 As I heard much said about absolute, indispensable necessity, I may be 
 pardoned for giving what I consider the sound interpretation of the words ne- 
 cessary and^roper, in the constitution. This idea of absolute, indispensable, 
 &c. must have originated in an excessive jealousy of power, or a decided hos- 
 tility to the federal Union. This instrument was framed by and for the Peo- 
 ple of the United States, and, in the language used, was certainly intended to 
 be understood in that sense in which it is used and understood by them gene- 
 rally. If you ask a plain man what are the necessaries of life, he will an- 
 swer, something below luxury and extravagance; what is calculated to afford 
 him reasonable comfort. Neither a house nor a bed is absolutely or indis- 
 pensably necessary to a man's existence; he could live in a camp, and sleep on 
 boards, or on the ground; yet, the common sense of mankind would respond, 
 they are necessary and proper. If a man had a journey to make, either to 
 Richmond, in Virginia, or Lexington, in Kentucky, although every person 
 would pronounce a coach and six superfluous and unnecessary, all reaso- 
 nable men would say, he ought to have a horse or a hack; but it will not be pre- 
 tended that either are indispensable, because he could perform it on foot. 
 If a gentleman from Baltimore gives his agent instructions to provide every 
 thing necessary for an East India voyage, what would he expect? Certainly 
 thathe should avoid unnecessary expense, but would consider him acting 
 within the pale ot his authority if he procured only what was reasonably ne- 
 cessary and proper, or, in other words, what was fairly suited to the master 
 and crew, and well calculated to enable the vessel to reach her port of des- 
 tination. That interpretation is correct which best accords with the common 
 sense and understanding of mankind. It must therefore be evident that the 
 only question, as regards the constitutionality of the measure, to be decided, 
 is a question of fact, and that is, whether a national bank is reasonably neces- 
 sary and proper, or fairly suited to, and calculated for, the collection of our 
 revenue and the management of our money concerns. And this fact appears 
 to be admitted by the gentlemen opposed to the bill: for their arguments are 
 predicated upon the probability that the State banks will answer the national 
 purposes. This is a complete surrender of the constitutional objection: for, if 
 banks be necessary and proper, it follows that we have a constitutional pow- 
 er to create them, and it will be a mere question of expediency whether we 
 will use State banks or a national bank. My colleague (Mr. CLAY) has asked 
 for the congeniality between a bank and the collection of our revenue. The 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 357 
 
 argument in favor of using Stale banks shews it; but let the use hitherto made 
 of the bank answer the question . Is not a bank a proper place for the deposite 
 and safe-keeping of money, more so than the custom house? Is it not a con- 
 venient agent for paying and receiving money? Through the agency of this 
 bank, our revenue, or the greater part of it, has been collected, our financial 
 transactions done, and public money transmitted to such places as the neces- 
 sities of the Government required. The revenue, collected at Boston, Balti- 
 more, or any other port, is paid, if required, at New Orleans, Natchez, St Louis, 
 or any other place, without risk or expense. The money in the bank and its 
 branches is payable at such of them as the convenience ot the Government may 
 require; and by this arrangement we can command the whole of the public 
 money in any quarter of the Union, without risk or expense. The operations of 
 this institution have been confined to the seaboard. The principal bank is at 
 Philadelphia, with a branch at New York, Boston, Baltimore, Washington, 
 Norfolk, Charleston, Savannah, and New Orleans; at all which places, the 
 Government has considerable revenue to collect. No branches have been ex- 
 tended into the interior. It has been connected with our fiscal arrangements at 
 all the places to which it has been extended, and may be fairly deemed a 
 convenient, necessary, and appropriate auxiliary to the management of the 
 national concerns. It is said that the revenue is collected at many ports 
 w here none of these branches are placed. This is true; the bank and branches 
 are fixed only at the principal seaports, where a large amount of revenue is 
 collected. Every one draws into its vaults, subject to the demands of Govern- 
 ment, the revenue collected at the less important ports in the same quarter of 
 the country. Boston being the commercial emporium of New England, the 
 Government, by the agency of the branch bank there, is enabled to draw to 
 that point mo*t of the revenue received at the numerous ports in that quarter 
 of the Union. The repeated sanctions this bank has received from the dif- 
 ferent administrations, and especially from Mr. Jefferson and the republican 
 party, by authorizing the extension of a branch to New Orleans, and selling 
 one million of the stock, the property of the United States, to British subjects, 
 for four hundred thousand dollars more than the nominal amount, is. indeed, 
 strangely accounted for. Gentlemen say the Government was bound to fulfil 
 their engagements, and that the charter, being in the nature of a contract, was 
 sacred. I had thought the fashionable doctrine was, that an unconstitutional 
 law was wholly null and void. It has been held by some of the States. How- 
 ever plausible the answer to the argument of acquiescence, it furnishes no 
 apology for a positive confirmation. Permit me to assimilate a common case 
 between individuals to the question before us. A man, in Washington, exe- 
 cutes a joint power to five trustees, in Kentucky, to collect his debts, settle 
 his land business, &c. and authorizes them to take all steps, necessary and pro- 
 per to effectuate the trust or power. In the progress of the business, a measure 
 is suggested as necessary, about which there is a diversity of opinion among 
 the trustees. A majority, however, decide that it is within their authority; 
 the principal is informed of it; does not complain or disavow; but positively, 
 and by the strongest implication, assents to the construction given by his 
 agents. In such a case there would be but one opinion. In 1791 a national 
 bank is proposed to Congress; they differ as to the constitutionality; a large 
 majority decide in favor of it; the People and the States are informed of the 
 measure; the States do not protest, nor dp the People complain; many of the 
 States pass laws to protect the institution; it receives the confirmation of 
 three or four different administrations, and particularly of the one composed 
 of men originally opposed to it; it violates no positive provision of the consti- 
 tution; no mischiefs have been produced, but great convenience and advan- 
 tage has been experienced by the Government and community. I ask whether, 
 under such circumstances, the question ought not to be considered settled. 
 Is no respect due to the opinions of our predecessors? Is a question of con- 
 struction never to be at rest? Why is a judge, sworn to support the lavys and 
 constitution of the country, bound by a train of decisions contrary to his own 
 opinions? Because the good, the peace, and tranquillity, of society, require it. 
 
368 BANK OF THE UNITED STATES. 
 
 The conduct of a court, as well as every department of Government, must be 
 regulated in its course, in some measure, by a regard for the public weal. It 
 is worthy of remark, that, notwithstanding all the fuss about implied and in- 
 cidental powers, if you except the sedition law, which was supposed to violate 
 a positive provision of the constitution, the same practical construction has 
 been given to this instrument by every administration of the Government. 
 Indeed, the sphere of national legislation has been more enlarged under Mr. 
 Jefferson's than any other administration. All parties have found that the 
 national vessel could not be navigated without sails, rigging, and every thing 
 necessary and proper. Whence was derived a power to pass a law, laying an 
 embargo, without limitation? There is nothing in the constitution about em- 
 bargoes. Whence did we derive a power to purchase Louisiana, and incor- 
 porate it with the good old United States? There is no express delegation of 
 power to purchase new territory. On these subjects, the constitution is silent. 
 I have approved both. No State can lay an embargo, or acquire new terri- 
 tory. Our power to perform these acts results from the nature of the national 
 sovereignty created by this constitution. The republican administrations 
 have no pretensions to the approbation of the People, on the ground of having 
 rest rained any latitude or liberality of construction. Their claim to the pub- 
 lic confidence is founded on very different considerations. They have repeal- 
 ed the internal taxes, paid a large part of the public debt, purchased Louisi- 
 ana, and preserved to the nation the blessings of peace. For these acts they 
 have, I believe, the thanks of the nation. They have mine, most sincerely. 
 
 Great stress is placed on the 12th article of the amendments to the consti- 
 tution, which declares, the powers not delegated to the United States by the 
 constitution, nor prohibited by it to the States, are reserved to the States, re- 
 spectively, or to the People. I must confess that I cannot discover what in- 
 fluence this can have on the bill under consideration, or any other measure 
 which may be proposed. It appears to me to have been adopted rather to 
 quiet State jealousies and popular fears, than witli a view to produce any posi- 
 tive effect: for the inquiry must ever be, is the power given? And if granted, 
 it is not retained. The supporters of this bill do not pretend to usurp any 
 power retained by the States or the People, but contend that the power to 
 pass the bill is expressly delegated, if the facts assumed are true. 
 
 It is not pretended that our fiscal concerns can be managed with gold and 
 silver. If our territory was of no greater extent than Rhode Island, Dela- 
 ware, or the city cf Philadelphia, gold and silver would answer the purposes 
 of the Government; but it would require a number of pack horses and wagons 
 to transport the public money in gold and silver over this immense country, 
 to the different places where it is wanting. Our extensive commerce, and the 
 great extent of this empire, renders a paper medium necessary. Is the power 
 to create this paper medium or national currency, an attribute of State or na- 
 tional sovereignty? I put the question to the candor of gentlemen, and solicit 
 a serious answer. The argument of my honorable friend from Georgia, against 
 the power of the States to authorize the emission of bank paper, rounded on 
 that part of the constitution which declares, that "no State shall emit bills of 
 credit," acquires great additional force, when these bills of credit are made 
 to assume the character of money, for national purposes. In the same arti- 
 cle, the power to coin money is expressly prohibited to the States; and in the 
 catalogue of cardinal powers granted to this Government, is that to coin 
 money. It will, perhaps, be contended, that this only applies to gold and 
 silver; but if that be admitted to be the literal meaning of the words, still it 
 is evident, that what shall be the national currency, whether specie or paper, 
 is a proper subject of national legislation. No gentleman will be so absurd 
 as to insist that any State or States ought to coin the current money of the 
 United States. That the power of the States to establish banks may be ques- 
 tioned, with at least great plausibility, is perfectly clear; but as this banking 
 power has been so long exercised, as the national and State banks have con- 
 ducted their operations very harmoniously, as no serious evils call for national 
 interference, 1 am not for disturbing the existing state of things; it is better, 
 
ON THE BILL TO KK.NKW THE CHARTER OF 1791. 
 
 perhaps, that the banking power should be divided between the States and 
 the United States. That bank paper, if good, is, in fact, money, although 
 not made a legal tender, cannot be denied. The currency of this bank paper 
 of" the United States, although made by law receivable in payment of revenue, 
 rests upon a much better foundation than an act of Congress; its national 
 character, the extended operations of this bank from Boston to New Orleans, 
 have given it credit with the People of every part of the empire, more than 
 the bank paper of any particular State can be expected to have; so that, by 
 common consent, this money coined by the National Bank has become the 
 current money of the United States. 1 hope we shall never be driven to the 
 necessity of compelling our citizens, by law, to receive our paper. We should 
 so guard and regulate our banking operations as to make the national paper at 
 least equal to o1d and silver, in every quarter of the Union. 
 
 If this bank Is removed, the Secretary of the Treasury must nationalise the 
 bank paper of the great importing .States: for, I presume, Congress will never 
 decide what State paper shall be used by the officers of the General Govern- 
 ment. Most of the public money is now collected and deposited in the Bank 
 of the United States; if that is destroyed, the Secretary of the Treasury is to 
 deposite in the Slate banks, and with him is the power of selection a power 
 and patronage greater than any ever exercised by any officer in this nation. 
 The deposites of the public money are sought after with great avidity, by all 
 the State institutions. lie can deposite the whole in one, or divide it between 
 two or three, or all the banks in any one place; he can change them at plea- 
 sure; he may, with great apparent lairness and propriety, make it a condition 
 with every bank, where deposites are. made, that they shall appoint a certain 
 portion of the directors of his nomination, and, throng)) them, he can reach 
 the credit of any man who may have accommodations in it. It is true, we have 
 now a man at me head of the treasury who may not be disposed to abuse this 
 power; but we may riot always have such an officer. This immense power 
 and influence may be exercised in an invisible manner, and, of course, with- 
 out responsibility. Is this republican? It was not a few years ago. I have 
 always understood that one of the strongest and most popular objections to 
 tiie. Federal Administration was, their disposition to increase Executive pa- 
 tronage. 
 
 We are told that our remittances to foreign countries and to different parts 
 of the United States, can be made in bills of exchange; this, to be sure, is 
 possible, but this mode is less convenient and more hazardous. I believe the 
 Government has sustained no loss in the remittances made to Europe, through 
 the agency of this institution. They are able, through the medium of their 
 several branches, to ascertain the credit and solvency of every commercial 
 house in the United States, and thereby to purchase bills for foreign remit- 
 tance;? with safety. The great punctuality secured to the Government in the 
 payment of the revenue, by their agency, is also an object of some consequence. 
 
 Much alarm and delusion have been artfully spread through the country 
 about a violation of the constitution, and a consequent destruction of our re- 
 publican institutions, I fear the People are unfortunately led to believe, that 
 the security of their liberties depends too much upon paper barriers, and too 
 little upon their own virtue and intelligence. It appears to me, that the con- 
 stitution is occasionally made a mere stalking horse, to serve the purposes of 
 unprincipled demagogues and pretended lovers of the People, to get into 
 power to the exclusion of honest men. They, with great address, distract 
 and inflame the public mind about some nice constitutional question, or ab- 
 stract proposition, and thereby bring the People to decide, not which candi- 
 date is the most entitled to their confidence, but who rides the finest elec- 
 tioneering hobby. We are misled very much, I fear, by theories, arid terms, 
 more applicable to other governments than our own. In Great Britain they 
 peak, with great propriety, of the Government and People, because there is, 
 in that country, an immense power, independent of the People. But, here, 
 where every public functionary is responsible to, and the Government in the 
 hands of, a majority ot the People, those terms do not appear to me applicable, 
 47 
 
370 BANK OF Till: UNITED STATES, 
 
 in the sense in which they are used in other countries. My reflections arid 
 practical observations on the Government, incline me to the opinion, thai, 
 with regard to measures of general policy not assailing individual liberty or 
 right, or the independence of any State there is not that danger to be appre- 
 hended from a liberal construction of the constitution which gentlemen seem 
 to imagine. So long as the Government is in the hands of the People, mea- 
 sures, affecting the whole nation, if oppressive or inconvenient, will be resist- 
 ed and corrected by the. public feeling and opinion. This is not mere theory. 
 Look at the State of Connecticut, one of the best regulated democracies m 
 ancient or modern times, whose Legislature is as omnipotent as the British 
 Parliament. 
 
 What People enjoy more real liberty and independence! In what country 
 is to be found more practical intelligent republicanism! Those principles 
 which secure the rights of the citizen, and the responsibility of their public 
 servants, are held sacred; but the Legislature is, I believe, unrestricted, with 
 regard to measures of general policy. It is a truth, which ought to be deeply 
 impressed on the American mind, that the preservation of this republican 
 system depends more upon the virtue and intelligence of the People, and the 
 responsibility of their public servants, than paper restrictions. It is unfor- 
 tunate, that every measure calculated to advance the national prosperity, is 
 arrested by some constitutional difficulty. The bills respecting the Ohio and 
 Delaware canals r which passed the Senate, have been opposed, in the other 
 House, by the same constitutional obstacles urged against this bank. I may 
 be asked, if I am opposed to any limitation on the powers of the Government? 
 To which I answer, no. I think the nature of the powers to be exercised by 
 the General Government ought to be defined with as much precision as the 
 imperfection of human language and foresight is capable of. The convention 
 acted wisely in giving no more latitude than was necessary to the success of 
 the experiment. Not because I think them so essential to the security of the 
 rights of the People, as to prevent unpleasant and dangerous collisions of au- 
 thority between the National and State Governments. In the application of 
 this instrument by the different men and parties to the ground supposed to be 
 embraced by it,, some trivial variations from what may be deemed by many 
 the true political meridian, was to be expected, and a small allowance is per- 
 haps due to human fallibility. It will be some time before the boundary line 
 will be plainly marked by usage and practical construction. So far as it has 
 been ascertained, and any question of power settled by common consent, 
 every consideration connected with the good of our country forbids us to dis- 
 turb it. Gentlemen endeavor to alarm us with a thousand imaginary dangers: 
 they say, suppose Congress were to do this, that, and the other monstrous 
 thing. You may suppose any thing, and make what deductions you please. 
 Suppose the People were to destroy their own liberties; what then? Their 
 liberties would be destroyed. Suppose they were all to collect on the bank 
 of the Potomac, plunge into the stream, and drown themselves; why, to be 
 sure, they would be drowned; but does it follow that there is any danger of 
 their doing either? All this supposing seems to accord better with a senti- 
 ment advanced by a celebrated Senator a few years since, " that the People's 
 worst enemies are themselves," than the generally received opinion respect- 
 ing the nature of this Government. 
 
 This bill T probably, is opposed by many, under an expectation of a new 
 National Bank. As this question will at least appear to be decided on con- 
 stitutional ground, their expectations will hardly be realised. Indeed, it is 
 questionable, whether either foreigners or our own citizens will again vest 
 money in a National Bank. The fall of this will throw a large portion of the 
 banking capital into the banks of the great commercial States, whose influence 
 and hostility will be increased against a new national institution. But why 
 put down one National Bank to raise up another? How are the People to be 
 benetitted by it? I shall be told, perhaps, that the direction ought to be 
 changed. And what will be this change? Why, putting out one set of mo- 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 371 
 
 n eyed men to put in another, who will very soon be the same. If this be the 
 object, I will only observe, 
 
 " Strange there should such difference be, 
 " 'Twixt tweedledum and tweedledee." 
 
 It is but the difference between Hopkins and Sternhold, and Sternhold and 
 Hopkins. A new National Bank, with an increased capital, would, to be 
 sure, open a new field of speculation, and increase that influence of which 
 ^'iillemen pretend to complain: lor, if moneyed men retain their confidence 
 in our institutions, the same motives which induced foreigners to purchase 
 seven millions of the present stock, will induce them to purchase the stock of 
 the new bank. I hear, with some astonishment, gentlemen opposed to this 
 bill, and particularly my friend from Tennessee. (Mr. ANDERSON) declaim, 
 with such apparent earnestness, about the danger of this institution, with a ca- 
 pital of only ten millions of dollars, when I recollectthe partiality they mani- 
 fested for a bill before us last year, which proposed to create a national bank, 
 with a capital of thirty millions. On the motion to postpone that bill till the 
 iirsi Monday in December last, in substance a motion to reject, it will be 
 found by a reference to the journals, that most of those opposed to this, voted 
 against the postponement. If this bank of fen millions is such a viper, a thirty 
 million bank would indeed be a monster. Gentlemen may say, that, although 
 they voted against postponement, they intended ultimately to vote against the 
 j;e of tho bill; let this be conceded, and still their votes evince a decided 
 preference of the new to the present institution. I voted for the postpone- 
 ment, because 1 was not entirely convinced of its constitutionality nor \\-.\ 
 i satisfied with the details. The banking operations of the present institution 
 are confined to the seaboard, and may be considered a necessary and proper 
 mean subordinate to the end of aiding the finances; but the bill I have men- 
 tioned contemplated an extension of branches into every part of the country, 
 to places where the General Government had no revenue to collect, and the 
 creation of it might perhaps be deemed the exercise of an independent original 
 power, transcending the limit of an auxiliary measure. I do not design to give 
 a decided opinion of the constitutionality of it at this time; other substantial 
 objections to that bill will suffice to justify my vote, if necessary. If the ob- 
 ject of gentlemen was to eradicate the banking system from the country, I 
 might, in obedience to my former prejudices, be more disposed to join them. 
 But this is not even pretended. 1 he sole object, in the death of this, is. to 
 generate more of these vipers, understate or Federal authority. 
 
 The People of the United States, through the medium of the National Go- 
 vernment, have within their control that portion of the moneyed capital vested 
 in this bank, which is not only a convenient agent, in the management of the 
 finances, but furnishes loans to the Government, to answer occasional deli- 
 ciences in the revenue. If we relinquish entirely our po\yer over the moneyed 
 capital, will not the influence of the interior States be diminishd, and that of 
 the commercial States increased? The importing States will have the mo- 
 neyed capital; the greater part of our revenue will be collected by theirbanks, 
 and we shall not only be dependent on them for loans, but they can at any 
 time withhold our revenue, without the interposition of force. 
 
 The sum required to be paid by the stockholders, is strongly objected to. 
 And why, sir? Is there any thing unreasonable in this provision? The privi- 
 leges and benefits, to be enjoyed by them, they will derive from the People of 
 the United States: ^for which, justice requires them to pay the People an equi- 
 table equivalent. This sum is demanded in the nature of a tax on the privi- 
 lege granted. The premium contemplated, with the probable advance on 
 the five millions of stock, authorized to be subscribed by the United States, 
 will amount to about three millions of dollars. They are to pay three per 
 cent, on the public deposites, which will, I suppose, without pretending to have 
 made an accurate estimate, amount to several millions more during the term 
 of incorporation; so that this bill, if passed into a law, will bring into the 
 national treasury five or six millions of dollars, for the benefit of the People 
 
372 BANK OF THE UNITED STATES. 
 
 of the United States; and what are we about to do? Why, sir, give it up to 
 the large States on the sea board, in whose banks we are told by gentlemen on 
 the other side, this very dangerous foreign capital will be vested, and our 
 revenue deposited. Well may those States clamor about State rights and 
 State interests; but how the interest or importance of Kentucky in the Union., 
 or of any other State where none of the national revenue is collected, is to be 
 advanced by the destruction of this institution, I am not conjurer enough to 
 discover. 
 
 It might be contended, with some plausibility, that this Government is under 
 an implied obligation to continue this bank upon equitable terms, and with 
 reasonable modifications. The present stockholders, both citizens and fo- 
 reigners, have paid for every 100 dollars they own, from 140 to 150 dollars. 
 The Government sold at about that advance a few years ago. When the 
 Congress of 1791 passed the law declaring that there should be a national 
 bank, did they intend it to be a temporary institution? In the numerous trans- 
 fers of stock which have taken place, was it so understood? Could it have 
 been expected that a Government, which declared a national bank necessary 
 and proper, the first twenty years of its existence, would dispense with it 
 afterwards? The limitation of the corporation to that period was very proper. 
 It is highly expedient that these charters should return occasionally into the 
 power of the People, to afford them an opportunity of revising and correcting 
 them; besides, such a limitation, by increasing their dependence, gives some 
 security to the community against abuses. Has not the conduct of the Go- 
 vernment authorized an expectation that this bank would be continued? 
 And if it has, are they not bound, by the rules of morality, to fulfil that expec- 
 tation, unless the constitution or public good clearly forbid it? 
 
 Although this subject has received much false coloring through the country, 
 by charges of British influence, &c. I did not expect to hear it from an ho- 
 norable Senator of the United States; it has not, indeed, been positively as- 
 serted, but hinted in such a manner, as to make an impression on the com- 
 munity. Some stale circumstances connected with the British treaty, have 
 been very unnecessarily lugged in, to increase the prejudices against this 
 bill. It has been insinuated that British influence, operating through this 
 institution, has prevented the Government from taking strong measures against 
 Great Britain; but in what manner this has been effected, gentlemen have not 
 been good enoudi to explain. Did it prevent Mr. Jefferson from taking a war 
 course? For I believe it is generally understood that he was opposed to a 
 war. Has it operated upon the present Executive? Such a suggestion will 
 not be made. I have, during my service here, given a fair and faithful sup- 
 port to the administration, and I have certainly voted for stronger measures 
 than they were willing to accept. It is due to the 10th and llth Congresses, 
 who have been so much abused, to state, that their course, as regards the 
 question of peace or war, has been in perfect unison with the views of the late 
 and present Presidents. Let it not be inferred that I am disposed to find 
 fault; I believe, when we consider the very extraordinary state ot'the foreign 
 world, and retrospect the embarrassing circumstances which have surrounded 
 us, the course pursued by them ought to be deemed substantially correct, 
 certainly so as respects their leading object, which has been to avoid making 
 this country a party in the present war. If I was disposed to censure, it 
 would be for not making an effort to chastise some of the British armed ves- 
 sels, which lay in our waters after the affair of the Chesapeake, in open con- 
 tempt of the President's proclamation; if a single vessel had been driven out 
 or compelled to strike her colors, it would have healed the wound inflicted on 
 the national pride and feeling, by the outrage by the Leopard. 
 
 That this Government should have an influence with foreign Governments, 
 proportioned to the interest their subjects have in our funds, is probable, but 
 how this interest gives them an influence here, I am at a loss to perceive: 
 foreigners cannot even vote in the appointment of directors. If there is any 
 reality in this idea of foreign influence through this institution, why did gen- 
 tlemen permit the present stockholders to be incorporated into the bill infro- 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 duced last year? And why was not a provision inserted, to prevent foreigners 
 from purchasing additional stock? 
 
 We are told too of their partiality in discounts. I might answer this argu- 
 ment, by asking, what bank or what administration has not been partial? 
 What member of this Senate has never used his influence in favor of his 
 friends against men, perhaps, of more merit? If partial evils or small impro- 
 prieties, are to authorize a war of extermination, against our institutions, none 
 would prove so immaculate as to escape the general catastrophe. By the bill 
 reported, an odious feature in the present charter, granting an exclusive pri- 
 vilege, is expressly repealed, and the Government authorized to subscribe 
 stock and appoint directors. This will give us a sufficient control to guard 
 against all the evils, real or imaginary, which have been complained of.^ 1 
 have heard no gentleman advocate a simple renewal of the charter. This 
 charge of partiality, on the score of party, at least for the last twelve years, 
 has been completely repelled by the deputation of five from the mechanics 
 and manufacturers of Philadelphia, and let it be remembered, too, that these 
 men are republicans of the first water. We are arraigned, sir, for the great 
 attention and respect shown to the two deputations from Philadelphia, oue in 
 behalf of the mercantile, the other of the manufacturing interest; from the 
 latter we derived the most of the facts which have been detailed to the Senate. 
 They did not come armed with any political resolutions, to influence our deli- 
 berations; no, they were sent to represent the embarrassments of the com- 
 mercial and manufacturing classes in Philadelphia, arising from the appre- 
 hended dissolution of the bank. And was it improper in the committee to 
 hear them? Their candor and respectability were not doubted by those of the 
 committee most opposed to the bank. Is any thing more common in Kng- 
 land than for Parliament to hoar witnesses, and even counsel, in behalf of any 
 class of men whose interest is supposed to be affected by a measure depencf- 
 ing before them? And shall we deny to American citizens privileges enjoyed 
 by British subjects? 
 
 Gentlemen say the embarrassments in Philadelphia could not have^eenoc- " 
 casioned by the Bank of the United States, because they continue to dis- 
 count as usual. If I recollect the evidence, and I hope to be corrected if I 
 mistake it, it was this: that the calling in of ten per cent, on their debts 
 occasioned such a pressure, that they were prevailed upon to extend their 
 discounts, until the ultimate decision of Congress should be known. I have 
 heard it seriously urged, that the evils and inconveniences to be expe- 
 rienced from its dissolution, prove it to be a dangerous institution; the same 
 argument would prove that the Government ought to be destroyed. Nothing, 
 indeed, seems too absurd for the human mind to seize upon, when under the 
 influence of passion or misguided zeal. 
 
 I must omit, Mr. President, many of the remarks I intended to offer to the 
 Senate, on this bill; I owe it to other gentlemen, who wish to express their 
 views. Before I sit down, I beg leave to say a few words about the liberty or 
 tyranny of the press. Tyranny is, to me, sir, a hideous fiend in every possible 
 form. A press, well conducted, is invaluable; but this palladium of our rights 
 may, if permitted to exercise an undue influence, be made the instrument to 
 entomb the liberties of this People. With what indignation would an attempt, 
 through the medium of the press, to intimidate a court or jury, in relation to a 
 controversy while pending, be viewed; and what course would be taken? I 
 need not answerthe question. And is it not equally important that our deli- 
 berations should be free from any improper and irresponsible influence? After 
 I have given my vote, I am ready to meet investigation; but this system of 
 abusing and denouncing members who may speak or vote for or against a mea- 
 sure depending before Congress, is a monstrous outrage upon the indepen- 
 dence of the National Legislature; and every attempt ot editors to influence 
 their decision by assailing or exciting unfounded prejudices against them re- 
 specting a subject upon which they are deliberating, ought to be reprobated and 
 resisted by every friend to his country. 
 
374 BANK OF THE UNITED STATES. 
 
 If it is once understood that Congress are controlled by the dictatorial arro- 
 gance of the press, what will be the consequence? However pure the presses 
 may now be, if it should beconie an object with a foreign nation to give a di- 
 rection to our measures, or of a junto of assassins behind the curtain to pro- 
 scribe every honest independent man from the confidence of the People, a 
 sufficient number of them will be purchased at any price; and through this 
 medium, if w r ell combined and organized, an unseen power will guide our 
 councils. 
 
 My honorable friend from Georgia has been reminded of the Macedonian 
 phalanx. I trust, sir, we shall ever be found associated with a phalanx, Ame- 
 rican, republican, in heart and in sentiment. I will not sacrifice the interests 
 of my constituents, for fear of being called hard names. The epithets of quid - 
 ism, quadroonism, or any other ism, which malice or policy may suggest, shall 
 not drive me from the course called for by the public good. I am proud that 
 I represent a People, just, generous, and independent; not to be carried a\yay 
 by unmeaning clamor. Before they discard a public servant, they will view 
 him, both on the political theatre, and in the walks of private life. They know, 
 too well, that those are not al ways the best Christians, who sing hallelujahs on 
 the house top; nor have they forgotten the celebrated Sempronius, who, on the 
 approach of Caesar, thundered war in the Roman Senate, and at the same 
 time was secretly co-operating with the traitor to overthrow the liberties of 
 the Roman People. 
 
 Deeply impressed, Mr. President, with the opinion, that the rejection of this 
 bill will give, at least, a temporary check to the prosperity of the rising State 
 from which I come, I shall give my negative to the motion to strike out the 
 first section. Yes, sir, not only the interest, but the importance of that State 
 in the Union, is about to be sacrificed. When I look beyond the mountain, 
 and remember that Kentucky has nurtured me almost from my cradle that 
 she has bestowed on me her choicest honors my bosom is filled with emotions 
 of gratitude, which impel me to say, on this, as on all other occasions, Ken- 
 tucky, I am only thine! 
 
 FEBRUARY 16, 1811. 
 
 Motion to strike out the first section of the bUl. 
 
 Mr. SMITH, of Maryland, said, that, in seconding the motion to strike out 
 the first section of the bill, he had pursued a course, which, in his opinion, 
 was the most correct. When I first took a seat in Congress (said he) the 
 course of proceeding was to fix the principle by resolution, and that once 
 fixed, to send it to a committee to report a bill. By a motion to strike out 
 the first section the principle will be tried, and the Senate, if the motion fails, 
 will go into a discussion of the provisions of the bill. This I conceive a bet- 
 ter course, than for the Senate to go into discussion of the details of a subject 
 which would probably be ultimately rejected on the general ground of 
 principle. 
 
 The gentleman who introduced this subject spoke with great animation and 
 with great feeling against the press or presses which have undertaken to give 
 their opinions upon this great, and important question. He spoke with warmth, 
 and said that wnoever knew him would not believe that he would permit him- 
 self to be driven out of his opinion by any man or set of men. There is no 
 man, sir, the least acquainted with the gentleman from Georgia (Mr. CRAW- 
 FORD) but will believe his declaration. But another result may be appre- 
 hended; that those who feel so great an oftence at the freedom the press lias 
 taken, may be driven into the opposite course by the irritation ot their feelings. 
 Certainly those feelings must have been extremely strong with the gentleman 
 from Kentucky (Mr. POPE) to have induced him to terminate his speech with 
 an oration hostile to the liberty of the press. Are the gentlemen from Geor- 
 gia and Kentucky the only Senators who have had their feelings wounded by 
 the conduct of the press upon this subject? Sir, if the gentleman's opinions 
 and sentiments have been censured by one description of presses, he may 
 find consolation in having been greatly eulogized by others. For more than a 
 
ON THE BILL TO RF.NKW THE CHARTER OF 1791. 375 
 
 year, those on the same side of this question with myself have had their opin- 
 ions tortured into every shape,to destroy them in the estimation of the People; 
 not only in this session but during the last. Sir. there are some presses in the 
 Union which could not exist, whose papers would not be read, but for the dis- 
 cussion of individual character. Is any advantage to be derived from com- 
 plaining of this? It results from the nature and temper of our Government, 
 and the best way I have ever found to treat it, is, with silent contempt, lie 
 who does otherwise engages in the contest at a great disadvantage, and will 
 seldom come out the victor. In the same presses of which those gentlemen 
 complain, I have seen them botli eulogised, and properly, for their conduct on 
 the subject of the embargo and West Florida questions. 
 
 If the press be an evil in this respect, we must submit to it; those gentlemen 
 who take a high and prominent stand must expect to be noticed. Sometimes 
 gentlemen will be put down by the press, but (their conduct being correct) 
 will more frequently be written up by its abuse. 
 
 It has been objected that this question is discussed on the ground of par- 
 ty; and the gentleman from Georgia, as I understood him, said, that this had 
 been made a party question elsewhere, and might be so here. [Mr. CRAWFORD 
 said he had mentioned no place, but had said that this might be made a par- 
 ty question.] I understood the gentleman to say (said Mr. S.) that this may 
 again be made a party question. But for this obr.ervation of the gentleman, 
 the subject of party would probably not have been introduced at all: and we 
 must indeed shut our eyes, or we cannot avoid seeing that this is made a party 
 question, at least on one side. Do you see on-* gentleman, one solitary gen- 
 tleman of one party, discriminated generally a- federal, who does not vote 
 for this measure throughout? 1) > you see one public body in Philadelphia or 
 New York, which has a majority ot federal directors or agents, which has not 
 come before you with memorials drawn up with the ingenuity of lawyers, to 
 impose on your judgment? Have not the same part) prepared memorials, and 
 got the subscription of every one of their caste, bringing forward nearly the 
 same number of petitioners as they have of federal voters? Have they not 
 done so in Baltimore? Of that city I Mould say as little as may be: for, being 
 a manufacturing as well as a commercial city, it has stirred up an animosity 
 in some gentlemen against it, not easily accounted for. In Baltimore, on a 
 warmly contested election, the federal party mustered 814 votes, all they 
 could parade with every exertion. To the petition for the renewal of the 
 charter of the bank there are 810 odd signatures! They have gained some 
 few since the last contest. Is this coincidence of numbers, this exclusively 
 federal petitioning, no mark of party? They have also got one public body in 
 Baltimore to memorialise in favor of the bank; the rest were not to be intimi- i 
 dated by the threats of the Bank of the United States. What, sir, have the / 
 other parly done? Have they disturbed the quiet of either House? Have 
 they brought forward tin 1 mass ni th'/ir voters as signers to petitions? No, sir, 
 they have trusted the subject to their Representatives, confiding in their dis- 
 position and ability to speak their sentiments. The representation of New 
 York, Philadelphia, Baltimore, Norfolk, and Chrrleston,in the other House, 
 have opposed the renewal of the charter. Every city, high in estimation as a 
 commercial city, is opposed to the renewal of the charter, except Boston. 
 This speaks with a strong voice what are the feelings of the People; stronger 
 evidence cannot be presented to the human mind. Far be it from me, sir', to 
 endeavor to work up the feelings of party spirit on this occasion; but the thing 
 itself was one of the first causes which created the present parties, and sepa- 
 rated man from man, and brother from brother. This measure was originally 
 brought forward and adopted when the representation in Congress was not 
 bottomed on an actual but supposed census ot the People of the United States. 
 Sixty-five members composed Congress then, which was a representation ta- 
 ken by accident. If a proportionate representation had been given to the 
 States, according to their population, the law probably would not have passed. 
 The States of North Carolina and South Carolina had each five representa- 
 tives, being thus placed on an exact equality. Now North Carolina has tidelvc. 
 
376 BANK OF THE UNITED STATES. 
 
 South Carolina only eight. What was the vote then? Out of sixty-five mem- 
 bers, thirty-nine voteclTor the bill. It was not, as my friend from Kentucky 
 said, a subject not fully discussed or carried by a tremenduons majority. 
 
 /The bank haying been formed, it may not be improper for me to take some 
 view of its beginning and its operation. At first, its operations were con- 
 fined to Philadelphia; it extended its branches, some time afterwards, to 
 Boston, New York, Baltimore, and Charleston. Wherever it extended its 
 influence, dissension commenced; wherever it placed its foot, it became abso- 
 lutely necessary for the States to erect another bank, to counterbalance its pe- 
 cuniary and political influence. In Philadelphia it began to oppose certain 
 people, and turn down their paper. The State of Pennsylvania, in defence of 
 its own citizens, created the Bank of Pennsylvania. Here was a check upon 
 its pecuniary and political operations. I believe 1 am not mistaken when 1 
 say, that, soon after it commenced in Boston, a new bank was established there, 
 from what cause I know not. In Baltimore, sir, it soon taught us a lesson, 
 and we met the lesson as other States had done. Charleston and New York 
 acted in a similar way. Operating as the bank did on the politics of the coun- 
 try, before its effects were neutralised by competition, man bein; man, place 
 him where you will, those concerned in the direction of the bank felt power 
 and exercised it. When the British treaty was pending before Congress, the 
 president and directors (as I am informed) themselves, carried about a me- 
 morial to Congress in its favor, with what view, and with what effect, may 
 easily be conceived. In Baltimore (until we were able to check them by other 
 banks) its political influence was great. Prior to the great struggle between 
 the parties, in 1798, they did permit one democrat to be within the walls of 
 the sanctuary, (as a director) a gentleman of as much respectability and inde- 
 pendence of character as any one of the direction. He was, however, (immedi- 
 ately after daring to give his vote in favor of a democratic candidate) put out; 
 and since that time no man of democratic principles has been permitted to en- 
 ter its walls as a director. Men must shut their eyes to the fact of this being 
 a party institution, when they see that no democrat has been admitted to the 
 direction of the bank, but in this city, and New York, where the collector 
 was admitted as a director, for the purpose of protecting the rmblic money, at 
 the instance (it is said) of the Secretary of the Treasury. Can we shut our 
 eyes so as not to see that men hostile to the democratic party, and of course 
 to the success of the administration of the Government, are not the most pro- 
 per persons to have charge of its pecuniary concerns? I would have been ve- 
 ry unwilling to have gone into this part of the subject; but when the gentle- 
 man from Kentucky, scarcely able to retain his rage, cried out, party! party! 
 L I was bound to show that it was not those with whom I act, who had any 
 ^ agency in presssng the subject of party into the present discussion. 
 
 s The gentleman from Kentucky reprobates the system of petty mischievous 
 intrigue, for the purpose of carrying measures through Congress. No man, 
 sir, despises or contemns such conduct more than I do. But on whose side 
 has this intrigue been? It is necessary to put the saddle on the proper horse. 
 Have we gone to insurance companies or corporations of one kind or another? 
 Have we intrigued with the People, to induce them to take sides with us? No, 
 sir, we have been tranquil; we wanted no aid of that kind. Have w r e sent 
 persons here to intrigue with members, or a deputy to remain here the whole 
 of the last and present session, to explain to Congress the effect of putting 
 down the bank, and threaten them with destruction and ruin to the United 
 States, if they passed the measure? No, sir, we have had no one here. Have 
 we stirred up the People in town meetings, to aid us by memorials? No such 
 thing, sir. Have we called meetings, and induced honest mechanics to come 
 here to influence Congress by idle fears, impressed upon them by those who 
 are interrested, to tell a tale that shall answer our purposes? No, sir, we have 
 pursued no such course. 
 
 Respectable merchants, I observe, form a part of the bank deputies for 
 what? To represent the late fall of the price of flour as a consequence of the 
 danger of the bank charter not being renewed, and thereby to alarm the minds 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 377 
 
 nf members. I am sorry that men of such respectable character did permit 
 themselves to come here on such an errand. I think I have seen in the papers 
 that one of the manufacturers (now here) on being asked to sign a petition for 
 a renewal of the charter for twenty years, said, he would rather cut oft his 
 right hand than sign it; he wished for a renewal for a short time, to give the 
 bank an opportunity to wind up its affairs. If this statement be true, and of 
 its truth 1 have no cause to doubt, it shows the depth of that intrigue which 
 sent this gentleman here, through the instrumentality of his excellent charac- 
 ter, to get a renewal of the charter for a period which he never contemplated. 
 These are intrigues for which men ought to blush, and from which, I thank 
 God, we are exempt. At the time these deputies arrived, there were three 
 mechanics of Baltimnre here, of character inferior to none, and of wealth 
 inferior to few in Philadelphia, and who would have given a different view of 
 the subject, if they had been asked to appear before the committee. I thought 
 it unnecessary; I wanted no assistance of that kind, no species of intrigue. 
 They did, however, declare, sir, that granting this charter \yould be a death 
 blow to the politics of the State of Maryland. They did believe the renewal 
 would be injurious to them: for neither they nor many of the manufacturers of 
 Baltimore had received much advantage from the branch bank. They had their 
 own banks, from which they generally received accommodation. Another 
 species of intrigue is carried on, to wit: by pamphleteering. The press is groan- 
 ing with pamphlets for what? To teach the minds of members, on this ques- 
 tion, the necessity of renewal, and probability of destruction to the nation, if 
 their demands are not complied with. Our tables are covered with pamphlets 
 of that tendency. Has tlu-re been any thing of the kind on our part? 
 
 I will now talve a view of a part of tne subject, into which, nermit me to say, 
 I have been pressed by other gentlemen, to wit: What has been the operation 
 of the bank, in regard to the collection of duties, prior to 1800? Prior to the 
 institution of the bank, the collectors took the bonds of the merchants for du- 
 ties, received the money, and deposited it for safe-keeping in the State banks, 
 where there were any. Alter the bank was erected, it had (for some time) but 
 two branches; still the revenue was as well collected, (I am informed) where 
 the branch Banks of the United States were not, as where they were; and yet 
 (it is said) we cannot have that reliance or confidence in the banks of the 
 States as we can on the branches of the Bank of the United States. The gen- 
 tleman from Massachusetts told us that in five New England States there was 
 but one solitary branch bank; and I could not find, from any thing that the 
 gentleman said, that he apprehended any distress would overtake the New 
 England States. The gentleman from Kentucky (Ma. POPE) told us that, in 
 Boston, the branch was the great bank of deposite; that, in the trifling out ports, 
 it was not of so much consequence to have branches, the whole collections be- 
 ing drawn into the branch bank at Boston. In order to show that there is an 
 absolute necessity for these branch banks in the collection of the revenue, the 
 gentleman (MR. POPE) ought to show that the company can place a bank 
 wherever money is to be collected, without enlarging the present capital: for, 
 if it were extended beyond its present amount, his concience would be prick- 
 ed: for, (if I understood him) he does not advocate the- constitutionality of the 
 bank, if its capital was extended beyond what he supposes to be necessary. 
 
 [MR. POPE said his idea was, that a bank of thirty millions must extend its 
 branches where there was no necessity for them, and where banks of another 
 description were competent to all the ordinary purposes of society.] 
 
 And of coursej said Mr. SMITH, if the capital extended beyond the limits of 
 the gentleman's idea of necessity, it would be doubtful whether it was con- 
 stitutional or not. Can a ten millions bank extend itself, as the gentleman 
 contemplates, to every place where the United States have moneys to collect? 
 In the State of Massachusetts there are twenty-three collection districts; Boston 
 owns 83,000 tons of shipping; the only branch of the United States' Bank in the 
 
 of 
 
378 BANK OF THE UNITED STATES. 
 
 had no branch, were of little importance. In the town of Salem, where there 
 is no branch bank, there is, perhaps, more East India trade than from any 
 town in the United States; the town of Naritucket, also, is a great trading 
 place; the town of Portland is a great trading town, arid there are a number 
 of other towns of great commerce in Massachusetts, none of which have a 
 branch bank; and yet I am informed, from high authority, that there are no 
 towns in the Union where the revenue is better collected than in those towns. 
 The branch bank at Boston, then, may be considered as a treasury chest y 
 and has nothing to do with the collections; an office, where the Secretary of 
 the Treasury keeps an account, to know whether the State banks transmit 
 the money properly to Boston or not. I have been informed, sir, by the 
 Comptroller of the Treasury, that no where are collections better made than 
 where there is no branch bank. It is among the most ridiculous of all ideas, 
 to say that the bank has any influence on the payer of the bond. The influence 
 on the payer is this, and this only, that, if the merchant does not pay his bond 
 when due, he has no longer credit at the custom house; he is compelled 
 thereafter (and until his bond is paid) to pay the cash for all duties, and in 
 that way only does he suffer. I agree with the Secretary of the Treasury, 
 that the creation of banks has contributed to produce the greater punctuality 
 of payment; but this arises as well from the State banks as from those of the 
 United States. A note given to an individual now, must be paid, or the credit 
 of the signer is lost; but that has no operation as to the .collection of the 
 revenue. In case of non-payments of bonds, what course does the bank 
 pursue in relation to custom house bonds? The same as with ordinary notes. 
 If the bond be not paid when due, the cashier returns it to the collector, who- 
 puts it in suit. The bank is a mere place of deposite for the safe keeping of 
 the bond, and has no farther interest in, or discretion over it, after its pay- 
 ment is refused. There are in the United States, including the territories, 
 ten banks, emanating from, and including the mother bank of the United 
 States^ and without these banks we are told the revenue cannot be collected. 
 This does appear to me to be one of the most extraordinary arguments that 
 ever entered the mind of man. Let us examine it. In the State of Massa- 
 chusetts there is but one bank to collect from three and twenty ports, pos- 
 sessing, independent of Boston, one-fifth of the whole tonnage of the United 
 States; there is no Bank of the United States in Connecticut, and yet Con- 
 necticut pays her duties as punctually as any State in the Union; there is no 
 branch in Rhode Island, and whoever heard that Rhode Island did not pay 
 her duties punctually? Maryland has eight ports and but one branch. Vir- 
 ginia has eleven ports, and no branch but a little one at Norfolk, whose opera- 
 tion is confined within the limits of that town. Where there are no branch 
 banks of the United States in the ports of that State, (Richmond and Peters- 
 burg for instance) the duties are better paid than where there is a branch; I 
 am authorized to say so. In North Carolina there is no branch bank, and 
 yet there is no difficulty whatever in the collection of the revenue. South 
 Carolina has a branch bank. Georgia, with four ports,has but one branch. My 
 object (it will be observed) is to show, that the revenue has been as well col- 
 lected where there were no branch banks, as where they have existed. Let 
 me tell the gentleman (Mr. POPE) that the banks of the United States afford 
 no facility in the collection of the revenue, that it is possible for them to avoid . 
 I state this, as deducible from the report of the Secretary of the Treasury. 
 He states that the re is in the Bank of Manhattan 188,000 dollars of the public 
 money. From what cause did it get there? The truth (it appears) was, that 
 the branch bank of the United States in New York refused to receive Con- 
 necticut or Rhode Island paper, and the Secretary of the Treasury was com- 
 pelled to deposite it in the Manhattan Bank, which bank had agreed to receive 
 that paper. Here, then, sir, we see that a State bank, although it gains no 
 advantage from the depesite of New York, yet has accommodated the treasury 
 by taking and accounting for the bank paper of Connecticut and Rhode .Island, 
 and placing it in a situation in which it can be made use of with facility. 
 Again we find that, in Georgetown, the Bank of Columbia has a cteposite of 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 379 
 
 115,000 dollars of public money. How did it get there? The Secretary 
 informs us, in his report, " that the deposites in the Bank of Columbia arise 
 from occasional drafts on some collectors in Virginia, and from the receipt of 
 moneys, paid at the treasury for lands, patents, &c. in bank notes not receiva- 
 ble at the office of discount and deposite, Washington." That is, sir. the 
 branch bank of Washington refused to receive Virginia paper from those 
 collectors, and refused to give any aid or assistance in the collection of the 
 revenue, except that which went to their own emolument. Not so with the 
 Bank of Columbia. It opened its vaults to all; and if any man desires it, he 
 may deposite in the Bank of Columbia, the paper of Virginia, Maryland, or 
 Pennsylvania, and the cashier will give him a check on some one of the banks 
 of those States for the amount. This they will not do in the branch bank. 
 Do gentlemen suppose that the notes of the United States' Bank pervade the 
 whole United States? No, sir, they do not. Does a gentleman representing 
 Ohio bring bank notes of other States to pay for his constituents tor land 
 bought of the United States, or debts due in Philadelphia? Can he go to the 
 branch bank and pay them? No, they are not bank notes of the United 
 States, but of the individual States, and the branch bank at Washington \vill 
 refuse to receive them. The Bank of Columbia (on the contrary) will receive 
 them, and will (if he wishes) pay the money in Baltimore, Philadelphia, or 
 New York, or \yill pay it here into the treasury. W T hatbank is it that collects 
 the revenue derived from the sales of western lands? Not that of the United 
 States, which is represented as indispensably necessary for the collection of 
 the revenue. No, sir, the collection is made by the Bank of Pennsylvania, 
 which bank established a branch at Pittsburg, and collects the money due the 
 United States, from the purchasers of public lands, as stated in the report of 
 the Secretary of the Treasury. 
 
 There has been one great mistake entertained by a gentleman, (Mr. LLOYD) 
 with respect to New Orleans. He supposes that there is no territorial bank 
 in that city, and asks how the collection of duties will be made without one. 
 The Bank of the United States there, has a capital of only 300,000 dollars; 
 that of the territory has 600,000 dollars, as good a bank, too, as any in the 
 United States. And (notwithstanding what has been said) the banks of New 
 Orleans are in as good credit, and have more specie, in proportion to the popu- 
 lation of the city, than any banks in the United States. If we should be 
 fortunate enough to obtain a majority for destroying this bill, the gentleman 
 need be under no apprehension for any injurious result arising at New 
 Orleans. The public money will be as safe there as in any bank, and we 
 shall find as honorable men directors of the territorial bank, as in that of the 
 branch Bank of the United States estabiished in that city. 
 
 There is scarcely an evil which has not been attributed to the embargo, and 
 which is not now(with as little justice) attributed to the expected non-renewal 
 of the bank charter. Great failures have lately taken place at New York; bills 
 of exchange on London, to a large amount, have returned protested, and the 
 drawers are not able to pay the holders; and to the present critical situation 
 of the bank some gentlemen attribute the distress brought upon those who 
 have suffered by these failures and protests. But, Mr. President, what is the 
 real cause of those failures? They are confined principally to New York, and 
 may be attributed to the following causes: It is natural for men born in Great 
 Britain to entertain predilections favorable to a commerce with that country; 
 their connexions, as well commercial as of family, are there; their credit is 
 there; and from those causes, the house which has failed, and carried so many 
 others with it in its fall, has probably directed the principal part of its com- 
 merce to England; they have no doubt shipped cotton ana tobacco, the trade 
 in which being in a great measure confined to Great Britain, the natural con- 
 sequence has been, that the markets of England were completely glutted; to- 
 bacco (except the very fine Virginia) scarcely paid the charges of freight and 
 commission, and the loss on cotton must have been near fifty per cent. The 
 consignees, under those circumstances, refused to pay the bills drawn upon 
 shipment of those articles. The bills returned protested, and ruin to the Amer- 
 
380 BANK OF THE UNITED STATES. 
 
 lean shipper has been the consequence. At any other time, the English mer- 
 chants would have accepted the bills, and held the cargoes for a better market . j 
 but, at that time, ruin stared every man in the face. No man in London 
 knew who to trust, and very few would enter into engagements which they 
 saw any difficulty in meeting. No censure ought to be attached to the Ameri - 
 can shipper: for, by the usage of trade between the U. States and Europe, the 
 American merchant is entitled to draw for two thirds the amount of his cargo, 
 on transmitting invoices and bills of lading with orders for insurance. Other 
 causes have existed to cause the present distress in New York and elsewhere, 
 to wit: the seizure, detention, and confiscation, of property in Denmark, 
 Prussia, and France, of ships and cargoes to the amount of many millions, on 
 the proceeds 'of which cargoes, merchants calculated to meet their engagements 
 at home, and to meet their bills drawn on London: for, sir, the merchants 
 who make large shipments to the continent, order the greatest proportion of 
 their proceeds to be remitted from thence to London, and on the expectation 
 thereof, draw bills on their friends there. Disappointment has been the 
 consequence of such seizures and losses; protests of such bills and ruin has 
 followed. But, Mr. President, we might (with as much propriety) attribute 
 the late great failures in England arid on the continent to the expected non- 
 renewal of the bank charter, as those which have happened in New York, or 
 the present distress of the merchants in the United States. The returns of 
 the bills protested to so large an amount, of course destroyed the merchant's 
 credit at bank; he failed, and, by his fall, has caused the ruin of others. 
 When a great house tails, it is like a game of nine pins; knock one down, and 
 it will probably carry with it four or five others. 
 
 When the honorable gentleman, up yesterday, made an observation on the 
 remarks of my friend from Tennessee, (Mr. ANDERSON) he certainly was not 
 warranted in what he said. He supposed that my friend from Tennessee gave 
 a vote at the'la^t session different from that which he should give now. I can 
 only say, for hiito, that he (Mr. ANDERSON) then said, uniformly, " make your 
 bill as good as you can, but I shall vote against it on constitutional grounds." 
 He wished the bill perfect if it should pass, though he was fully determined 
 to vote against it. 
 
 We have been told, Mr. President, in case the charter should not be re- 
 newed, that we shall find, in future, great difficulty in obtaining loans. What 
 loans, I ask, have Government ever received from the Bank of the United 
 States? I recollect, when I first entered Congress, that Government were 
 indebted for loans made from the bank, but I also recollect, that the bank 
 complained of the loans as an inconvenience, and that Congress took the earli- 
 est measure in their power to pay them off, and have, since that period, made 
 no new loan from the bank, until that made payable the 1st of January last. 
 I will not inquire whether even that loan was necessary, but I will venture 
 
 depc 
 
 sand dollars of the public money, (the amount of the late loan) they will lend 
 Government to the same amount, and thus do as the Bank of the United States 
 has done, lend you your own money,, and very kindly receive from you an in- 
 terest of six per cent, therefor. We are told that the bank has lately lessen- 
 ed the discounts of individuals 10 per cent, and that the merchants are thereby 
 greatly distressed. Is that a fact? If it is, and great distress has ensued 
 therefrom, what will be the distress of the merchants if the bill now before 
 you shall pass, and if, agreeably to its provisions, Congress should, at any time 
 hereafter, call on the bank for the loan of four millions, promised by the bill 
 If, sir, a lessening of their discounts one-tenth percent, creates distress, what 
 will be the consequence, when, by a loan of four millions, called for from the 
 bank, the bank shall be compelled to lessen the discounts four-tenths? 
 
 But, sir, the promise to lend four millions from a bank of ten millions, is 
 idle; it is worse, it is deception on the face of it The loan, if made, would 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 33! 
 
 not be from the bank, but from the merchants, whose discounts would there- 
 by be lessened, and whose ruin would follow. 
 
 We are told that, if the charter of this bank be not renewed, and the funds 
 of the United States be deposited in the State banks, it will be extremely 
 unsafe, because it is said we can have no control over them. And I wish to 
 know, sir, what control we have over the Bank of the United States? None, 
 but the same as we may have over the State banks. We cannot check the 
 operations of the Bank of the United States; and if they obtain this charter, 
 they will know that they can have their charter renewed whenever they please; 
 so that the fear of a non-renewal of their charter will have no operation on 
 them in future. You will have a much greater control over the State banks, be- 
 cause you are under no obligation to put money in them, and you can change 
 them whenever you think proper; the danger of losing the public deposites 
 will always be a sufficient control over their conduct. The security of the 
 State banks is doubted, however; and we are told, very gravely indeed, that 
 there is much more security in the mother bank and her nine children, than 
 in ten independent banks. This I must deny. I should, as a merchant, place 
 more continence in ten independent houses, than in one with nine branches. 
 
 It has been observed, (said he) by an honorable gentleman from Kentucky, 
 (Mr. POPE) "that the question on the Bank of the United States was not 
 originally a party question, and had not excited much sensibility at the time." 
 When first this question came before Congress, sir, it excited not a little 
 sensation. The doings of the convention having been recent, were then 
 fresh in the minds of such of the members of Congress as had been in that 
 body. To them it was well known, that an unsuccessful attempt had been 
 mad?, in that convension, to give the power of creating charters. The subject, 
 it is well known, was very fully ami amply discussed, on the passage of the 
 charter. The honorable gentleman from Georgia has, in the course of his ar- 
 gument, disclaimed all authority, and depends (as every gentleman should) 
 on a fair construction of the instrument itself. Not so with my friend from 
 Kentucky, (Mr. POPE.) He bottomed himself on authority, and called to his 
 aid the great name of Washington. He told us, also, of the able support that 
 measure received from a gentleman, for whose virtues and talents ne always 
 had the highest respect, although generally differing from him in politics he 
 meant General Hamilton. He also called into his aid the opinions of the pre- 
 sent Secretary of the Treasury. These, sir, are powerful authorities. Gene- 
 ral Washington, it is true, signed the charter, and gave it the sanction of his 
 name and authority. But, let it be recollected, sir, that General Washing- 
 ton demurred on the bank bill till the last hour of the ten days, and that he 
 signed it reluctantly at last. He took the opinion of the then Secretary of 
 the Treasury, Mr. Hamilton, on the subject; it was an able one, and he being 
 at the head ot the Treasury Department, it had, in consequence, a powerful 
 effect on the mind of General Washington. It was as ably resisted, in point 
 of argument, by the late President of the United States; and however high 
 may be my opinion of the talents of General Hamilton, I must venture to be- 
 lieve that, in point of a discriminating mind, Mr. Jefferson was no ways his 
 inferior. The charter, also, was opposed by the then Attorney General of the 
 United States, (Edmund Randolph) a man inferior to few in point of legal 
 knowlege; and, but for the impression made on General Washington by Ge- 
 neral Hamilton, (whose being at the head of the Treasury Department added 
 great weight to his opinion) he probably never would have signed it. In the 
 discussion of that question, a very able part was taken by Mr. Madison. The 
 name of that gentleman, as President of the United States, has been made 
 use of by the gentleman from Kentucky; I am not certain that we are entirely 
 in order, when we undertake to bring into debate the name and opinions of 
 the President of the United States. It having, however, been done, I pre- 
 sume that I shall not be out of order in pursuing the same course. The argu- 
 ments of that gentleman, on that occasion, add another wreath to his fame. 
 Neither was its rejection less ably advocated, on that day, by my friend from 
 Virginia, Mr. Giles. In point of authority, I produce these, as at least equal 
 
382 BANK OF THE UNITED STATES. 
 
 to those brought forward by my friend from Kentucky. We are, therefore, 
 left, as we ought, to exercise our own judgments on this instrument itself, 
 the authorities being counterpoised. 
 
 I have already, sir, taken a short view of the course of the proceedings by 
 the bank for the collection of the revenue. Permit me to pursue that point. 
 Prior to the establishment of any branch bank in the United States, the collec- 
 tors, as I have already stated, did collect each for himself; and after the 
 money had been so collected, they paid it over into the banks, either of the 
 States, or of the United States, where it was deposited for safe -keeping, the 
 banks being accountable to the treasury for the amount. There was no dif- 
 ficulty, at that time, that I ever heard of, in conveying the public money 
 wherever the exigencies of the country might require. After the branch 
 banks were extended, no use was made of them, but as places of safe keep- 
 ing for the public money. They had no instrumentality whatever, in the col- 
 lection of the revenue, prior to the year 1800- simply treasure boxes, (if you 
 please) in which the public money was deposited. This was the course of bu- 
 siness for nine or ten years after the charter of the Bank of the United States 
 had been created. No use, I repeat, whatever, (for nine years of its existence) 
 was ever made of the bank or its branches, for the collection of the revenue; 
 they were mere places of safe deposite. If they were necessary and all-essential, 
 why were they not necessary, and equally essential, at all times? Was not the 
 revenue equally as well collected, for the first nine years of their existence, as 
 it has been since, and with as little loss to the public? In 1800, a bill was 
 brought in and passed. If my recollection serves me, I was the author of it. 
 My object, whether I was the author of it or not, was not to aid the collection 
 of the revenue. Such an idea never entered my mind. I knew the collection 
 of the revenue was then well made. What, then, induced me to bring in, or 
 advocate that bill? It was this: the collectors gave bond and security when 
 they entered the office; I feared that they might aid those gentlemen who be- 
 came their securities, and, from time to time, lend to them (for their private 
 uses) the public money. It appeared to me that it was to the private interests 
 of the collectors, as well as the public interest, to" deposite the bonds taken 
 for the revenue, in the great towns, within the banks of the United States. 
 Prior to 1800, the collectors took the bonds themselves, and kept them in 
 their offices. To put it out of their power (if they were so disposed) to lend 
 their friends the public money, I was induced to support that bill; and I have 
 no doubt that it did save the public money, in some instances, from the effects 
 of the failures in 1798. The bonds, in the six great towns, were, after that, as 
 the law of 1800 directed, deposited in the bank and its branches, and collect- 
 ed by a short notice being sent from the bank to the merchant, to wit: that his 
 bond became due on a certain day, and the bonds were, ever after, paid into 
 those banks. The banks had no instrumentality whatever in obtaining (ex- 
 cept in that way) payment of those bonds. Compulsory process was not found 
 in the Bank of the United States, but in the revenue laws; if the debtor did 
 not pay the bond when it became due, he lost all credit at the custom house, 
 and must therefore pay cash he is put under the ban. This is a lien on his 
 punctuality, and it is such a lien as secures to Government the punctual pay- 
 ment of the revenue. However unable the merchant may be to pay the debts due 
 to individuals, every exertion will be used by him to pay the debts due to 
 the United States, for his bonds. I trust that, from this practical exposition 
 of the operation of the banks, (arid as far as my information goes, I am bold 
 to say it is a correct one) that no gentleman will doubt that State banks 
 will be as efficacious in the collection of the revenue as those of the United 
 States have been. 
 
 But, in the event of a non-renewal, we are asked how are we to pay the 
 army and navy, and the public officers? Precisely in the manner we have al- 
 ways paid them through the instrumentality of the banks. At New Orleans, 
 (where a great part of our army now is) the public money will be deposited 
 in the bank of that territory, consisting of a capital of $600,000 a bank, as 
 well and as honorably conducted as that of the United States. For a draft 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 333 
 
 of the paymaster of the army of the United States on that bank, the deputy 
 paymasters will have the option to take either paper or hard dollar*. I may 
 add, that the territorial bank paper is as well received, and in as good credit, 
 as the paper of the branch bank at New Orleans. How is your navy generally 
 paid oft? By a treasury warrant on the Bank of Columbia, (which is not a 
 branch bank) and which is paid in branch or other paper, at the option of the 
 holder. Would this paper, by such means, be made a coin of the United 
 States? No, sir, it would have no such effect. If, however, the purser of the 
 navy should ask specie for his treasury warrant, the Bank of Columbia would 
 give it to him: it is at his option to take the one or the other. In like manner 
 your public officers will be paid. 
 
 In what paper, the gentleman asked, will your duties be collected? In that 
 kind of paper which the collectors, or the Secretary of the Treasury, will 
 think as secure as that of the United States. If a merchant offers to pay his 
 bond with paper not approved of by the cashier of the State bank, (where the 
 bonds are deposited) he will refuse to receive such paper. What will be the 
 consequence? The merchant must pay approved paper or specie, or his credit 
 will be lost at the custom house; the consequence, I have already stated. As I 
 have observed, sir, let the gentleman look into the repective States, among 
 the farmers, merchants, and planters, of the interior, and see what proportion 
 of the paper in circulation is that of the United States. I venture to say, not 
 one for ten,- and it arises from this circumstance, that the agents and factors 
 of the farmers and planters do business principally with the State banks. 
 
 But, Mr. President, some kind of inconvenience, it is thought, will result 
 from the dissolution of the bank, because its paper is an universal medium. 
 Sir, there will be an understanding between the banks of the different States; 
 and the Secretary of the Treasury tells you that arrangements are nearly com- 
 pleted to attain that object; the Secretary does not complain of the inconve- 
 nience that some gentlemen appear to apprehend. 1 am of opinion that 
 the more accounts the treasury opens with the State banks the easier will be 
 the transmission of the public money. What is the present mode of making 
 remittances, by individuals, from New York to Richmond? A merchant in 
 New York wishes to purchase five hundred hogsheads ot tobacco in Rich- 
 mond. If he applies to the branch bank, and says he wishes to make a remit- 
 tance for the purpose of purchasing tobacco at Richmond, the branch, bank will 
 not, cannot aid him; but if he applies to the Manhattan, Farmers', or Me- 
 chanics- bank, they will take his money, and give him a check on Richmond 
 to enable him to make his purchase. Here, then, is a convenience not afford- 
 ed by the United States; Bank and its branches. In the same way will the 
 State banks act in relation to the funds of the Government. The Govern- 
 ment wants $100,000 in New York. They have it not there, but have it, how- 
 ever, in Richmond. All the Secretary ol the Treasury will have to do, will 
 be to direct the cashier of the Virginia bank to send $100,000 to New York. 
 It is done every day for individuals, and no inconvenience is experienced! 
 Suppose a merchant in New York wants to buy a cargo in Baltimore; he ap- 
 plies to the branch bank in New York, takes out their notes, and sends them 
 to Baltimore to buy his cargo; he will apply to the branch bank of Baltimore, 
 and say, " here are notes of the branch bank of New York; give me money 
 for them." No, sir, the cashier will not receive them; the branch bank will 
 
 t fair A ilip nanm- *>vmi iif t Ko mrtthof H-inL- TU/Mr ,..,. ,\~ ; *,.. ._>-! 
 
 not take the paper even of the mother bank. They may do it to oblige parti - 
 cular gentlemen, but they are not obliged to do it. I have said that the paper 
 of the mother bank is not a payment to the branches; nor are the bank notes 
 of the branches to the mother bank. Each branch is bound only to receive its 
 own paper, and not that either of the bank or any of its branches. For in- 
 stance, lately, (as I am informed) the branch bank of Baltimore being called 
 on by the mother bank for specie, applied to the Union Bank for specie for a 
 debt due by that bank of $50,000; assigning as a reason that they were called 
 upon for specie by the mother bank. The cashier of the Union Bank said as 
 was natural, we have notes of that bank to the amount of $100,000 we will 
 pay you in them; her own paper will certainly be as good a payment to her as 
 
384 BANK OF THE UNITED STATES. 
 
 specie. A r o, was the answer; you must give the specie; and the specie was 
 paid. The Union Bank was, in consequence, compelled to send to Phila- 
 delphia, at its expense, for payment of the notes which it held of that 
 very bank. A similar transaction (I have been told) took place between the 
 Mechanics' Bank of New York and the branch bank of that city. I state 
 those cases to show that the paper of the mother bank is not a universal me- 
 dium, not even payment to her own branches: whereas, in the understanding 
 which exists from Richmond to the Bank of Columbia, from the Bank of Co- 
 lumbia to the bank in Baltimore, and thence, to New York, the paper of each 
 will be received by each, and when too great a balance exists against either, 
 its paper is sent to the debtor bank, for which it returns specie. I cannot be- 
 lieve that any gentleman can seriously suppose that bank paper can be con- 
 sidered as coin. It is true, that, by your law, all the paper of the mother 
 bank and its branches, is receivable in payment for duties; but it is not a cur- 
 rency in all cases, because it is not a tender in any, except for duties, and if 
 I owe a note at the branch bank of Baltimore, and offer to pay mother bank 
 paper, it is optional with the branch whether it will receive it or not. I have 
 no wav of compelling them to receive it, because no paper is a tender to it but 
 that of its own branch,, except, as I have said, for public dues. 
 
 I have been referred by my honorable friend from Georgia (Mr. C.) to the 
 late letter of the Secretary of the Treasury. I have been told by my friend 
 from Kentucky, (Mr. POPE) that he is willing to place his faith on the great 
 talents of the head of the treasury. I am not going to contest the talents of 
 the Secretary of the Treasury, nor have 1 the smallest objection to his let- 
 ter on this subject, as respects the information it lias given. I respect it as 
 that of one of the high officers of our Government, and hope I never shall be 
 found (from any fortuitous circumstances) to doubt its due authority. I shall 
 treat it as I would all the reports from the heads of departments, with re- 
 spect; but I will not be bound by the report, or pin my faith (as my friend 
 from Kentucky, Mr. P. proposes to do) on the sleeve of any man breathing. 
 I did not object to this letter, but I had an objection to bringing in by com- 
 mittees a support of this kind, which is to have the preponderating force of a 
 report of the head of a department, to the aid of gentlemen on that side of the 
 question. I did state, and now repeat it, that, in 1793 and 1794, so powerful 
 an instrument did such reports become, in support of improper measures, that 
 the House was offended, and the Secretary ot the Treasury (Mr. Hamilton) 
 ^vas compelled to confine himself, ever after, to the handing in reports stating 
 facts, without being allowed to give opinions, and to use arguments in support 
 of them. An intimation was given by a resolution of the House, and we had 
 afterwards no arguments sent to us by the treasury. We received (acts, 
 statements, and documents, and were permitted to Form our own opinions. 
 A course, however, has been latterly taken in our proceedings, which fully jus- 
 tifies the honorable gentleman from Georgia in the course mat he has pursued 
 as chairman, and will also justify the Secretary of the Treasury in the greater 
 part of his letter. I am not to be understood as having (on a former occasion) 
 cast censure on the Secretary of the Treasury for writing the letter; it be- 
 came his duty to answer the inquiries of the chairman of the committee; he 
 did so. But the letter is now before us, and, having been referred to by the 
 
 ate, of March 20, 1809, expressed my opinion in favor of a renewal of the char- 
 ter of the Bank of the United States, an opinion which remains unchanged, I 
 can only add a few explanatory remarks in answer to the inquiries of the 
 committee, as stated in your letter ot yesterday." Here, then, sir, he bot- 
 toms himself and his opinions on the report of 1809, for a national bank a 
 bank truly national, not of the limited capital of the United States Bank, 
 which is scarcely enough for the pocket expense of the merchants in a single 
 city: not a ten millions bank, which was adequate to all the purposes Tor 
 which it was intended twenty years ago; but not now, when we have grown 
 
ON THE BILL TO RENEW THE CHARTER OF l'/91. 335 
 
 Yip to a state of comparative grandeur. The Secretary of the Treasury wants 
 a bank, I presume, something similar to that which was proposed at the last 
 session; to which, if I recollect right, my friend from Kentucky was opposed. 
 If the letter of the Secretary be the authority on which my friend wishes to 
 bottom himself, he ought to take the whole of it. The Secretary does not 
 mean, by that paragraph, to advocate & simple renewal of the charter, but a 
 national bank capable of extending its ramifications into every State, and 
 placing branches m every State and town where large collections of public 
 money are made. That being the view of the Secretary of the Treasury, I 
 wish we hud known how, at the last session, to have drawn out his aid in 
 support of his own measure. Again, the Secretary says, "The banking sys- 
 tem is now firmly established, and in its ramifications extends to every part 
 of the United States. Under that system the assistance of banks appears to 
 me necessary for the punctual collection of the revenue, and for the safe 
 keeping and transmission of public moneys." Here the Secretary says, the 
 banking system has extended its ramifications in every part of the United 
 States, True, sir, but it is not the banking system of the United States; that 
 system only affects a few cities. What then are the ramifications he alludes 
 to? The State banks, through whose instrumentality collections have been 
 made with as much honor, punctuality, and correctness, as by the Bank of the 
 United States, and with more facility to the Government, because those banks 
 will receive the paper of other banks in payment; whereas the branch banks 
 will not. 
 
 " That the punctuality of payment is principally due to banks is a fact gen- 
 erally acknowleged." That is, sir, that the banking system has introduced 
 a punctuality between man and man, which has created a regularity in all pe- 
 cuniary transactions. The Secretary, however, certainly cannot mean to 
 attribute that punctuality to the Bank of the United States, but to the gene- 
 ral system of banking. The sentence is, however, ambiguous. 
 
 " Its punctuality is, to a certain degree, enforced by the refusal of credit at 
 the custom house, so long as a former revenue bond, actually due, remains 
 unpaid." Here, sir, I disagree with the Secretary. Punctuality in payment 
 is not, in a certain degree, enforced by a refusal ot credit at the custom house, 
 but by that alone. The refusal of credit at the custom house is alone the real 
 enforcing cause. It was not, therefore, wise, or correct in the Secretary to in- 
 sinuate that it was only in a certain degree. The loss of credit at the custom 
 house will always compel the merchants to pay their bonds to the United 
 States, however they may deal with individuals. 
 
 The Secretary then goes on to state, that "he thinks, nevertheless, that, in 
 order to ensure that precision in the collection ? on which depends a corres- 
 ponding discharge ot the public engagements, it would, if no use was made 
 of banks, be found necessary to abolish altogether the credit now given on the 
 payment of duties." If no use was made of banks, credit, he thinks, should 
 be abolished at the custom house: and gentlemen who read this cursorily 
 will be apt to apply the remark to the Bank of the United States. Not so the 
 Secretary of the Treasury; the sentence is ambiguous, but he must mean that, 
 if there were no banks ot any kind, punctuality between man and man would 
 not be so assured, and the merchants would not be so competent to meet their 
 engagements, as they would if aided by banks. 
 
 " State banks may be used," says this report, " and must, in case of a non- 
 renewal of the charter, be used by the treasury. Preparatory arrangements 
 have already been made to that effect; and it is believed that the ordinary 
 business will be transacted through their medium, with less convenience, 
 and in some respects with perhaps less safety than at present, but without any 
 insuperable difficulty; nor will the United States have any other control over 
 the manner in which the business of the banks may be conducted than what 
 may result from the power of withdrawing the public deposites." 
 
 What inconvenience can there be? None that I can imagine, nor will 
 there be any. The safety will be the same: for, let me again repeat, that the 
 treasury has no more control over the Bank of the United States, under the 
 49 
 
386 BANK OF THE UNITED STATES. 
 
 law as it now exists, than it will have over the State banks. What control 
 (it may be asked) will the treasury have over the State banks? A powerful 
 one, in my opinion. If it does not appear that they are conducting your and 
 their affairs safely, the Secretary will take the public deposited from such, and 
 place them in others; you can thus operate powerfully on the interest of those 
 with whom the public deposites are made. Have you more control now over the 
 Bank of the United States? No, sir, not so much: for the law compels the 
 Secretary to deposite the public bonds with the Bank of the United States and 
 its branches, and he has nx> power to withhold them. 
 
 I am bold to say, sir, that the State banks are conducted with as much 
 prudence and ?s much security, in the large towns, as that of the United States. 
 In Virginia, as I have already stated, there is a trifling branch of the Bank of 
 the United States, of 300,000 dollars capital. That branch is in a corner of 
 the State with which the people of Virginia have very little intercourse. Their 
 great intercourse is with the banks of Tlichmond and Fredericksburg. What 
 is the state of the specie of the Bank of Virginia? It is superior to that of the 
 Bank of the United States. I believe the capital of the Bank of Virginia is 
 one and a half millions of dollars; it has near two millions of dollars in its 
 vaults at present; it generally divides eight per cent. ; the last dividend was 
 ten. Here then is a dividend greater than that of the Bank of the United 
 States; and the Bank ofVirginia has none of that check from the United States 
 Bank which is deemed by my friend from Georgia so necessary to the regu- 
 larity of State banks. [Mr. CRAWFORD explained " that those who gave 
 testimony against themselves certainly might be believed; and the State banks 
 had themselves stated that they were Kept in a salutary check by the 
 Bank of the United States.' 5 ] Mr. S. continued. I am happy to learn, sir, 
 whence the gentleman drew his conclusion that the Bank of the United 
 States was necessary to keep the State banks in check.. I do not know what 
 species of directors they can be who tell us that it is absolutely necessary that 
 we should have the United Stales' Bank to check them, and keep them from 
 injuring themselves. It is the old doctrine of Mr. Morris, revived in a new 
 form, that the People are their own worst enemies. Can it be believed that the 
 directors of any bank would state that the Bank of the United States was ne- 
 cessary to check them? If it be so in Philadelphia, it is certainly not so in 
 Richmond, where they have uot this check. So far from the branch in Vir- 
 ginia keeping the State banks in check, the Bank of Virginia always keeps the 
 branch at Norfolk in check. 
 
 The Secretary does not give his positive opinion on the competency of State 
 banks to the transmission of revenue, &c. but says, "it may be added, that, 
 even for ordinary business of receiving and 'transmitting public moneys, the 
 use of a State bank may be forbidden by the State, and that loans to the United 
 States are by many of the charters forbidden without a special {permission trom 
 the State." If there be any such charters, the Secretary of the Treasury 
 need not make use of the banks which have them; he may find enough of banks 
 that can give ample security. As for the ordinary and extraordinary busi- 
 ness of the treasury with the banks, I have already shewn that, for the ordi- 
 nary business, the State banks can do it as effectually and with as much secu- 
 rity as has heretofore been afforded by the branches. The Secretary then 
 goes on, sir, to give his opinion in direct contradiction to the bill before you', 
 and shows that, whatever reliance gentlemen may have placed on his authority, 
 they have not reported a bill in conformity to it. " It does not seem necessa- 
 ry to advert to the particular objections made against the present charter, as 
 those may easily be obviated by proper alterations. What has been called a 
 National Bank, or, in other words, a new bank of the United States, instead 
 of the existing one, may be obtained by such alterations. The capital may 
 be extended and more equally distributed; new stockholders may be substi- 
 tuted to the foreigners, as had been suggested in the report of 2d March, 1809; 
 and any other modifications, which may be thought expedient, may be intro- 
 duced, without interrupting the operations of the institution now in force, 
 and without disturbing all the commercial concerns of the country." This 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. ''; 337 
 
 project, sir, was tried at the last session. We unfortunately did not get the 
 aid of my friend from Kentucky. // was then agreed to merge the whole capi- 
 tal of the Bank of tlie United States in a national bank, but rejected by the 
 bank agent a bank of thirty millions, which would have been found ^capable 
 to extend its ramifications wherever banks might be wanted. The secreta- 
 ly's letter speaks of the plan of the national bank, and not of the one con- 
 tained in the bill presented to us. The Secretary continues, >4 >\ ithout 
 dwelling on the inconvenience of repaying at this time to Europe, a capital ot 
 seven millions," &c. 
 
 The Secretary, Mr. President, is considered by his friends, a very great 
 man in fiscal operations; in commercial matters, I may be permitted to have 
 opinions of my own, and to differ from him (without offence to my friend from 
 Georgia) on a question simply and exclusively commercial. Now, sir, where 
 is the difficulty of sending these seven millions (owned by foreigners} to Eu- 
 rope? There is no more difficulty, I answer, than for the merchant who owes 
 seven thousand dollars in England to remit it This seven millions will not 
 be taken out in silver or gold, to send to England, as is feared by gentlemen. 
 No, sir, men do not carry political enmities to the extent to injure their own 
 interests. The foreign stockholders will not remit specie, because, if theydo, 
 it will cost them from five to seven per cent. If they do not remit in specie, 
 how will their funds be conveyed to England? By the most plain and simple 
 mode that can be. The agents of the British stockholders will do one of two 
 things: they will vest the funds in the State banks, or funds of the United 
 States; or direct their agents to remit the amount in bills of exchange. And 
 how will that be done? By buying bills of exchange, which, for every nine- 
 ty pounds paid here, will yield them one hundred pounds in England, because 
 bills of exchange are ten per cent, below pur. and there is no chance of their 
 rising. As they can make this gain by bills, does any man conceive that they 
 will not thus remit their money, if remitted at all? Well, sir, gentlemen will 
 perhaps again ask, can we spare this money from the United States, and will 
 it not injure the young industrious mechanics and ruin the agricultural inter- 
 est? Those are idle fears; an exchange of property will take place. The 
 American merchants have, at this time, more than double the amount (of the 
 seven millions) now in, or which soon will be in, the hands of the English 
 merchants, which they will be glad to transfer by bills to the British stock- 
 holder, for his funds in the stock of the Bank of the United States; and thus 
 the English stockholder will receive the amount of his stock without one dol- 
 lar of specie being sent out of our country, and the funds of our merchants, 
 now in England, will thus replace the funds of the English stockholder. 
 
 Here follows an apprehension of the Secretary, founded on false premises. 
 He says, " And, without adverting to other possible dangers of a more general 
 nature, it appears sufficient to state, that the same body of men, who owe 
 fourteen millions of dollars to the bank, owe, also, ten or twelve to the United 
 States, on which the receipts into the treasury for this year altogether depend; 
 and that, exclusively of absolute failures, it is impossible that both debts can 
 be punctually paid at the same time/' Permit me here to observe, that I dif- 
 fer with the Secretary on the question of fact. I cannot believe that the tea 
 or twelve millions due by the merchants for duties to the United States, are 
 due by the same individuals who are indebted to the Bank of the United States, 
 the fourteen millions stated by the Secretary; because, i know that the great 
 body of the merchants who owe for duties, do their business with the State 
 - banks, and of course cannot be those who are stated as debtors to the Bank of 
 the United States. Some of my friends, for whose opinions and persons I 
 have an unbounded respect, are still apprehensive that great distress will re- 
 sult for want of the usual discounts to the merchants of the United States, in 
 case of a non-renewal of the bank charter. The fear is an idle one; it will be 
 precisely the old story of the green ass. It will be remembered nine days, and 
 not much longer. The course of proceedings will be this: The Secretary tells 
 you, that arrangements have already been made to transfer the money from 
 the Bank of the United States, to the State banks. I believe they are in full 
 
388 BANK OF THE UNITED STATES. 
 
 operation. He will take three millions of dollars (the public money now Je* 
 posited) from out of the Bank of the United States, and put it into the 
 State banks. Add thereto* above four millions ofdcpqsite, the property of the 
 merchants, which will also be taken out of the Bank of the United States, arid 
 put into the State banks. That is, seven millions of dollars will be immedi- 
 ately drawn from the Bank of the United States, and placed in the State 
 banks. Upon this money the State banks will feel themselves justified in go- 
 ing into larger discounts, and upon such funds, will be able to take up all good 
 paper thrown out by the United States' Bank, in consequence of the non-re- 
 newal of its charter. Were 1 a negotiator in the Bank of the United States, 
 and had I great discounts in that bank, and were the moneys transferred as 1 
 have suggested, I should have no apprehension, and should put my paper in 
 the State banks into which the deposites are removed, with a full confidence 
 that it would be discounted. This, then, is an idle phantom, raised to deceive 
 gentlemen, who are not particularly acquainted with the business. What is 
 the reason, sir, that none of those fears, those horrible terrors, (presented to 
 our imagination) are felt in Baltimore? The merchants there, generally, are 
 of the republican party, and feel none of those fears. And yet, sir, we are 
 told of the great distress, and almost led to believe that universal ruin will 
 ensue. The distress will not be felt sixty days after the 3d of March. If 
 felt by any, it will be by those who can now pay five shillings in the pound, 
 and who, if they go on three months longer, would not pay sixpence. We are 
 told that this bank has been honorably, correctly, impartially, and fairly con- 
 ducted. The honorable gentleman who made this declaration, assureil us 
 that he was not versed in the subject of banking; and this was at once giving 
 a most convincing reason against his opinion. He receives the opinions of the 
 gentlemen who are most fnendly to the institution, probably from gentlemen 
 that never felt a partiality for any other. Let the gentleman apply to mer- 
 chants on the other side of the question, and he will receive very different in- 
 formation indeed. In Boston ? the honorable gentleman from Massachusetts 
 told us, that the bank has for its President, a gentleman of high talents, great 
 integrity and respectability, and he did not depict him too highly. I know 
 him well, and am bound to believe the information the gentleman has given as 
 to the well meaning of the branch bank there. By the well management of a 
 moneyed institution, we understand an attention to the advantage of the stock- 
 holders. In that point of view, (no doubt) the bank has been well managed. 
 I have a letter, which goes to prove, to my satisfaction, that the branch at New 
 York has not been managed with all that impartiality and correctness which 
 has been stated by the deputies from Philadelphia. I will read an extract 
 therefrom; the writer is a gentleman whom I highly respect, of mild manners, 
 good sense, and great respectability. He says, *' I can speak from experience 
 to this fact, (impartiality. ) I have employed a capital of between two and 
 three hundred thousand dollars in trade here, (New York) for several years, 
 and from being considerably engaged in navigation, my bonds for duties to 
 the United States have amounted to many thousands a year; yet I can aver, 
 that the branch bank has never aided me in the payment, by discounts or oth- 
 erwise, whilst the Manhattan Bank has freely discounted the paper which the 
 branch rejected, merely by reason of the contamination of passing through re- 
 publican hands." I know nothing, Mr. President, but from such informa- 
 tion, as to the partiality or impartiality of the bank at New York, except from 
 common fame, who is sometimes said to be a common liar; still some confi- 
 dence is due to general report. In Philadelphia, it is said that the bank has 
 been impartially and honorably conducted; and I will not doubt the gentle- 
 man's words. I do not know what it has done lately, but, some years ago, I 
 heard such a detail of its conduct, as was no proof of the allegation. In Nor- 
 folk, I will venture to say, that the conduct of the bank never was considered 
 impartial; and I had a letter last year, from a highly respectable merchant in 
 that place, which (if now in my possession) would have proved the contrary. 
 In Baltimore, sir, we have heard it said in another place, that the bank dis- 
 counted as much for republicans as for federalists. I cannot contradict this; 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 339 
 
 I cannot, because I have not seen their books; but I believe there is not one 
 republican in Baltimore who will give his assent to that information. If it 
 were the case, I could not well have failed to know it. We ought not, sir, to 
 place entire reliance on the information of interested men. We were told, 
 but a few days ago, and the information was derived, I believe, from the same 
 identical letter as the stated information, "that the Union Bank of Mary- 
 land was the first bank which refused to receive foreign gold." I have in- 
 quired into that fac*, sir, and find that the Union Bank never refused it, ex- 
 cept in one instance, until the House of Representatives rejected the bill 
 from the Senate on the subject of foreign coin. I have a letter from the cash- 
 ier of that bank in my hand. He writes, "that the first information I had 
 respecting foreign gold, was from the cashier of the Bank of Baltimore, (Mr. 
 Cox) who handed me the proceedings of the Banks in Philadelphia on that 
 subject. It is impossible lor me to say which was the first bank that refused 
 to take it; and can only state, for ourselves, that we continued to receive and 
 pay it, at its usual value, (with one or two exceptions) the amount not exceed- 
 ing two or three hundred dollars difference, until the House of Representa- 
 tives refused to agree to your resolution on that subject in the Senate. On 
 the 30th of October last, we received from the bank of Maryland $10,000, 
 without deduction, as you will see by the enclosed certificate." I state this 
 fact, sir, at this time, only to show how cautious gentlemen ought to be in 
 placing reliance on information of this kind. It is impossible for me, living 
 as I do, in Baltimore, to believe that the republicans have experienced im- 
 partial conduct from that bank. 
 
 We have been told, sir, that the high improvement in the agricultural State 
 of Pennsylvania is to be attributed, in a great measure, to banks, particularly 
 to the Bank of the United States. 
 
 The gentleman (Mr. POPE) called upon us to remark the difference in the 
 improvement of cultivation between that State and others, and to see what 
 the State owed to the institution of banks. I have no doubt, sir, that the in- 
 stitution of banks lias contributed as well to the prosperity of agriculture as of 
 commerce; but this effect has been much more produced by the State banks 
 than bv the Bank of the United States. Has Connecticut any branch of the 
 United States? None; and yet the honorable gent Ionian from Kentucky, when 
 he travelled through that country, could not have failed to see as high a state 
 of cultivation there as in Pennsylvania. Now, sir, on the other hand, the 
 State of Maryland, which has the enviable ad vantage of a branch Bank of the 
 United States, in addition to her immense capital in State banks, has not as 
 yet progressed to that high state of cultivation witnessed in Pennsylvania. 
 This more probably proceeds from the temper, habits, and climate, ol her po- 
 pulation, than from the cause assigned by Mr. P. 
 
 We are told, Mr. President, there is a prodigious scarcity of money in the 
 great cities. Money, Mr. President, like every other commodity, will go 
 where it finds its best market; and if in the State of Virginia there be a better 
 market than in Philadelphia, there will it go and there it has gone. In Vir- 
 ginia, they have what will command money wheat and tobacco; and the mer- 
 chants from the great cities were obliged to go there for those products, where 
 they could buy cheaper than they could at home. Wliat was the consequence? 
 Money went where it found the best market, and that was in Virginia; the 
 fact is proved from the quantity of specie in their bank. There is no scarcily 
 of money in South Carolina, where merchants were obliged to carry their 
 money tor the article of cotton. A scarcity of money results from a scarcity 
 of means of acquiring it. From the large cities we have exported all or a 
 great proportion of pur means, and we cannot get back the. money for want of 
 the usual sale of bills of exchange; and thence results the great scarcity of 
 money in those cities. It is in vain to tell me, as I have heard in the course 
 of the discussion, that United States' paper is the only universal medium. In 
 the interior, we find the paper of the State banks, and of the State banks 
 alone, in circulation. 
 
390 BANK OF THE UNITED STATES. 
 
 In the animadversions of the gentleman from Massachusetts, in order to 
 enforce his argument, and show the danger which will result to State banks, 
 he brought forward an example very strong in point, viz: that an agent of one 
 of those banks, sent here for the purpose of obtaining those deposites, had de- 
 camped from this city on hearing of the failure of a great broker, which en- 
 dangered the bank of which he was a director, to such a degree, as to depre 
 ciate the value of its stock twenty per cent. [Mr. LLOYD said he had stated it 
 is a rumor, for the authenticity of which he would not vouch. ] I was going to 
 say (observed Mr. SMITH) that, from the high opinion I entertained of the de- 
 licacy of that honorable gentleman on every subject touching the credit of a 
 bank, I was convinced, that, unless he had proofs as strong as those of holy 
 writ, he would not vouch in such a case; that he would be cautious in giving 
 such a thing as truth, unless he knew it of his own knowledge. As to the 
 statement which he made, there must have been some mistake. One week 
 before the gentleman in question left this city, he gave notice that he should 
 go away on Thursday. He did go on that day, and had previously applied 
 to the Secretary of the Treasury for a share of the deposites of the Govern- 
 ment, and produced a report from his bank to show the substantial character 
 of the Mechanics' Bank. The account of the failure of the broker, Mr. Judah, 
 did not arrive until two days after the gentleman alluded to had left this city. 
 He could not, therefore, have returned to New York on that account. What 
 is really the fact? The Mechanics' Bank of New York stands on as substan- 
 tial a foundation as any bank in the United States, and has, in proportion to 
 its stock, more specie in its vaults than any bank I know, except that of Vir- 
 ginia. Mr. Judah did fail; but the stock of the bank did not experience a 
 more unusual fall than that of other banks. The great failures at that time 
 staggered every man for his own safety. The banks looked around with 
 caution. The value of the stock in every bank experienced a depression. 
 At that moment the Mechanics' Bank paid its dividend of 4 per cent, and 
 the stock, which wa& worth 20 per cent, above par, did go down to 15$ per 
 cent. What was the loss, at any rate, sustained by this great broker? The 
 Mechanics' Bank, I understand, will not lose 2,000 dollars by all the failures; 
 by Mr. Judah, not a dollar. On the contrary they have money to pay him. 
 I mention this fact to show that we should be extremely cautious, indeed, in 
 placing reliance on facts of this kind, from sources over which we have no 
 control. 
 
 We are called upon, sir, to believe, that the borrowers at New Orleans are 
 less safe than elsewhere. I had thought they were more safe, because they 
 have more valuable produce to export; because they have more specie among 
 them than in any other part of the Union; and because the people of the whole 
 western country send their products there for sale, and do not press the mer- 
 chants too much in return. One reason has been assigned (by Mr. LLOYD) 
 why we should renew this charter; that, in this city, loans have been made to 
 the amount of 400,000 dollars, which are expended in canals, houses, bridges, 
 and improvements; and we must renew the charter to enable those people to 
 go on. That reasoning, sir, has no influence with me. There has been one 
 prodigious mistake in all this business. It is taken for granted, that the mer- 
 chants cannot pay their notes at bank, unless they obtain new discounts. 
 This would be to say, that they were carrying on trade without any other 
 than bank capital. The loans in Baltimore, on made paper, are a mere drop 
 in the bucket, compared with the extensive trade of that city. A great pro- 
 portion of the notes which the bank reports as payable, are on bona tide sales. 
 The borrower does not depend on any loans from banks lo meet them, but 
 draws on his own means to pay such notes. But there are in all banks what 
 is called negotiable paper. We borrow from the bank a stipulated sum, and 
 understand that, unless the bank is hard pressed, it will continue the renewal 
 of notes, to take up that stipulated sum. A note is signed by A, and endorsed 
 by B, for which no property is paid; it is a mere note of accommodation. 
 That note, when it comes due, is not expected to be paid, unless by a renewal 
 with the same endorser, or, if the endorser becomes bad, a good one. Thus 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 39 ^ 
 
 a director of the bank will have discounts to the amount of 27,000 dollars re- 
 newable at bank. He cannot get more unless on real paper. Our banks do 
 not dare to discount beyond their means, because they are obliged to pay cash 
 for every legal demand. The gentleman from Kentucky has told us, that 
 two or three importing States may be benefitted by the dissolution of the bank. 
 I will not answer the argument; it is such a one as can go only to disunite, 
 to create envy and jealousy. I would not resort to that kind of argument, 
 and I will not permit myself to answer it. 
 
 We are called upon, in a manner extremely impressive indeed, by the gen- 
 tleman from Massachusetts, to hearken to the imlormation received from the 
 committee of mechanics and merchants now here, from Philadelphia. I am 
 well informed, sir, that both those committees were composed of very re- 
 spectable men; some of them republicans; and it is said, that they complained 
 of a very great scarcity of money, and that trade was not brisk. I will ask 
 them, sir, if they ever knew trade brisk in January or February? It is pre- 
 cisely the same at Baltimore as at Philadelphia; when the rivers are frozen, 
 we wind up our books and do not expect to do business. 
 
 One of those gentlemen stated, that he always found a convenience in hav- 
 ing his notes discounted in the Bank of the United States, and if he could not 
 get it there, he applied to a friend, who discounted notes that had a longer 
 time than two months to run. It is a possible case, that these persons may 
 have been very much employed in building houses for one of the directors of 
 that bank. It may have been the case, that that director accommodated him 
 by discounting his paper at a longer time than sixty days. This kind of em- 
 ployment between man and man has a wonderful influence on the mind of 
 man; and he who receives a benefit, is willing to return it in some way or 
 other. Mr. Grice appears to be a very worthy mechanic; but I am sorry that 
 he should be obliged to say, that those who contracted with him were afraid 
 that they could not comply with the contract on account of the difficulty oc- 
 casioned by the non-renewal of the charter; and yet he told us, that the Bank 
 of the United States still discounted its usual quantity of paper. I am sorry 
 to see that the merchants of Philadelphia, great and respectable merchants 
 as they are. make contracts for ships, and tell the ship builder that they are 
 obliged to depend on discounts for payment for the ships. I did not expect 
 this was the case there; and will venture to say, it is not the case in many 
 other places. 
 
 One of those gentlemen tells us he had to pay one and a half percent, per 
 month for money. Sir, he got the money very cheap. When one gets into 
 the hands of the shavers, or what the gentleman calls only discounters, if he 
 gets out for one and a half per cent, per month, he is not coarsely shaved. It is 
 not an uncommon price. Money is worth what it will sell for; and, in Phila- 
 delphia, shaving or discounting is considered as honest and fair as any other 
 commercial transaction; that is. to pay and receive more than legal interest. 
 It is not there considered as dishonorable or improper, whatever it may be in 
 Baltimore. 
 
 It is the belief of this committee of merchants that, in consequence of the 
 non-renewal of the charter, flour fell to $7| in Philadelphia. Now, this, sir, 
 is one of those good strokes, those excellent things, that the friends of the bank 
 use to deceive and influence the agricultural interests with. It is, therefore, 
 brought home to the farmers in Congress. I state this to show how cautious 
 gentlemen ought to be in suffering their minds to be impressed with these 
 statements. The fact, in this case, it not as stated. The moment at which flour 
 fell was on the receipt of an account from Liverpool of its having fallen to 565. 
 per barrel; and that there was no demand for consumption. vVhat was the 
 consequence? Fifty-six shillings a barrel will not allow more than $7 to be 
 given here; so the price of flour fell. These gentlemen also informed our 
 minds further, that a demand from a British house, for Lisbon, was not ex- 
 ecuted, by a house in Philadelphia, from the want of funds. This may be 
 true; but a great portion of that very order has been actually executed at Bal- 
 timore, at ten dollars per barrel, payable in bills of exchange, at a fair discount 
 
392 BANK OF THE UNITED STATES. 
 
 often per cent. The ramifications of commerce arc such that no one who is 
 not daily conversant with them can know them. There was no occasion for 
 u fall of flour, because the ports of Cadiz and Lisbon were still open; but 
 there was a momentary apprehension that Massena had got into Lisbon, and 
 commercial men for a moment afraid to let their property go to that market. 
 This lasted but two or three days; it lasted just as long" as the terror of the 
 non-renewal of the charter of the Bank of the United States will last. The 
 gentlemen who were sent on here happened to come at a favorable moment to 
 scare us with the depression of the price of flour. But before the question is 
 taken, we learn its rapid rise again to the former prices. 
 
 Our minds have been alarmed by a representation of the immense influence 
 which the Secretary of the Treasury will have over the banks to whom de- 
 posites are given. I should have no objections whatever, as to myself, that the 
 collector of every port should be, exofficio., a director of the bank in which de- 
 posites are made; and as to the argument that such a power would enable a 
 Secretary of the Treasury, if he were a bad man, to injure individuals, it is 
 not worthy of consideration. No Secretary would dare to take such a course; 
 the thing would be proclaimed here in such a voice as would made the often - 
 der decamp with precipitation from his office. 
 
 The report of Mr. Orr, one of the mechanics, I had like to have forgotten. 
 He says, all confidence between man and man is destroyed. My letters, sir, 
 say that all confidence is not destroyed, but in those whose rashness has been 
 the cause of their forfeiting all title to it. In order to strengthen Mr Orr's 
 argument, we are told that the price of hemp is fallen. That is true; but 
 what does the fact prove? Not that the approaching dissolution of the Bank 
 of the United States has caused it; the reason is, that the arrivals from Russia 
 are more numerous than ever before recollected every vessel that comes 
 from Russia brings hemp. Again, our good friends to the westward and in 
 Virginia, have commenced the culture of hemp, and carried its production to 
 an extent nearly equal to our consumption. Add to that cause that the demand 
 is much lessened by the destruction of our shipping. We build few ships now. 
 We ought not to rely on these facts; they result not from the dissolution of 
 the Bank of the United States, but from the course of trade. 
 
 I have before taken occasion to remark that certain mechanics were here, 
 respectable men, who would have come forward if I had wished them; they 
 would have told you that they did not rely on the Bank of the United States 
 at all, but on the State banks, for accommodation. I stated that one of those 
 gentlemen thought the renewal of the charter would have an unfortunate ef- 
 fect on the politics of the State of Maryland. The party to which they be- 
 longed had twenty years ago declared the charter of the United States' Bank 
 to be unconstitutional; they were in earnest when they declared so. From 
 these circumstances, a renewal of the charter at this time, would go to con- 
 vince the People that the struggle of parties was nothing but a business of ins 
 and outs, and not depending on principle. For myself, sir, the question never 
 came before me on a constitutional argument before; and I do confess, as my 
 friend from Kentucky says, that I was not very squeamish on the subject. 
 But the able arguments of my friends from Kentucky, Tennessee, and Vir- 
 ginia, have made a very serious impression on me, indeed, and have almost 
 brought me to think, that, if there were no other objections, I should vote 
 against the bill on the constitutional question alone. But my mind has re- 
 ceived a wonderful impression indeed from the arguments of the gentleman 
 last up, (MR. POPE.) He carried his doctrine of constructionjsofar, that, it ap- 
 peared to me that he regarded no other part of the constitution as binding 
 but the preamble. In support ot his doctrine he brought forward the example 
 of the State of Connecticut, which State has no written constitution. It ap- 
 peared to me, sir, that the gentleman's arguments, if valid, reduced us pre- 
 cisely to the situation of Great Britain to look for our constitution in laws, 
 precedents, and parliamentary construction; to have no written guide. My 
 mind became alarmed; and hereafter I shall be very much afraid, indeed, to 
 

 ON THE BILL TO RENEW THE CHARTKIl OF 1791. 393 
 
 giveniy consent to these kind of constructions, about which I have not here- 
 tofore, been very squeamish. 
 
 I have taken up the time of the Senate to an extent at least equal to any 
 thin 01 T had intended, and beyond that which many gentlemen no doubt think 
 I ought to have occupied, I have not wished to prolong my discourse to an 
 unreasonable length, and shall, therefore, leave untouched some points 1 had 
 intended to have noticed. 1 am unwilling to trespass on the patience oi the 
 Senate, because I am well aware that, unless this bill passes speedily, it can- 
 not pass at all. Aware of that, I was willing, for one, and so were all the gen- 
 tlemen with whom I act, to take a silent vote on the principle, so as to have 
 given full time to gentlemen who brought forward the bill to have gone 
 through with its provision-. But another course, that of discussion, has been 
 thought proper to be pursued, and I have deemed it proper to express my 
 sentiments. 
 
 Mr. S. concluded with hoping that he had not said any thing to wound the 
 feelings of gentlemen in opposition to him, for whom he had great respect. 
 If any thing Tie had said had hurt the feelings of any one, he hoped to be be- 
 lieved when he assured them that such was not his intention. 
 
 Mr. POPE. Mr. President: Instead of interrupting the gentleman from 
 Maryland, I preferred to correct him after he had finished his speech. Iha\e 
 examined the journal, and cannot lind that any question about extending a 
 branch to Kentucky was made; but I have a very perfect recollection of my 
 views and impressions in relation to the bill. That bill provided that six mil- 
 lions of the capital should be divided among the States, to be subscribed and 
 paid by the. Stales within a given period. Iwas aware that the rich moneyed 
 States on the seaboard would subscribe, but did not believe the new States 
 would tax the People to raise the money. In order, therefore, to diffuse the 
 interest and influence concentrated in this moneyed institution, and thereby 
 preserve to each State, if the bill passed, her due weight in the federal Union, 
 I proposed an amendment to this effect : that the capital should be limited to 
 twenty millions; that is, ten millions in addition to the present stock, four of 
 which, as provided in the bill, to be subscribed by the United States, and six 
 millions to be divided among the States, and paiu out of the national treasury. 
 Jf my plan had been adopted, and a branch extended to Kentucky, the divi- 
 dends made on the capital employed there, would have gone into the treasury 
 of the State. H has been a favorite policy with me to produce a unity or con - 
 solidation of interest in this nation. With that view I have advocated the 
 encouragement oi manufactures, and the appropriation of a portion of our funds 
 for the improvement of the interior by roads and canals. Upon the same prin- 
 ciple, if the bank bill had been permitted to assume the shape 1 proposed to 
 give it, I should not have been hostile to its passage. A consolidation of 
 interest is necessary, perhaps indispensable, to give strength and permanency 
 to this confederated republic, and free it from the dangers and evils consequent 
 upon a consolidation of power. I have several times expressed my opinion, 
 on this floor, in relation to a consolidation of power. We ought to guard 
 against it. Under this impression, I have been opposed to extending the 
 coercive agency of this Government upon the People of the interior. Upon 
 the same principle, I have approved the repeal of the internal taxes, not so 
 much on account of the sums demanded from the People, but because I think 
 it difficult, if not impossible, to have such a system, requiring so much federal 
 agency, well managed by one Government, over this immense country. 
 
 FEBRUARY 18, 1811. 
 Motion to strike out the first section of the bill. 
 
 Mr. BRENT said he had not the vanity to believe, after the subject had been 
 so fully discussed, that he should be able to shed any new light on it; but, 
 having been instructed by the Legislature of the State which he haxl the donor 
 to represent, to vote on constitutional principles against the bill under con- 
 sideration, and as he was reduced to the painful necessity of going counter to 
 50 
 
394 BANK OF THE UNITED STATES. 
 
 those instructions, it seemed to him to be indispensably necessary that he 
 should submit to the Senate the grounds on which lie acted. It is (said he) 
 a most painful situation in which I stand in relation to the Legislature of 
 Virginia, in being compelled to vote in opposition to their will, more especially 
 as it is a prevalent opinion, with many whose opinions are entitled to great 
 respect, that instructions are obligatory on a Senator. This question is one 
 which has never been settled, or even fully deliberated on. Instructions, 
 when heretofore given to Senators, have generally been in accordance with 
 the sentiments of the Senators, and only added the greater weight to their 
 opinions, if called upon definitely to pronounce with regard to instructions 
 on questions of expediency, I might be under some difficulty as to what 
 course to pursue; because, although there is no clause in the constitution to 
 that effect, I am under a strong impression that, according to the principles 
 of our Government, there is much reason to believe, that the respective State 
 Legislatures should have such]a right; but, on a constitutional question, (what- 
 ever may be the right of the State Legislatures in other instances) the right 
 of instruction may be denied, in my judgment, that is, so far as to be impera- 
 tive on the Senator. To give a vote in such a manner as in his estimation to 
 inflict a vital wound on the constitution, is more than the Legislature of Vir- 
 ginia, or any other State Legislature in the Union, can compel me, or any 
 other Senator of the United States* to do. The resolution of Virginia is 
 bottomed, not on the ground of inexpediency, but on the principle mat the 
 constitution prohibited Congress from granting the bank charter in the first 
 instance; that it now prohibited it; and, therefore, because it was unconsti- 
 tutional, the Legislature have instructed their Senators in Congress to oppose 
 it. Now, sir, although 1 shall not immediately and directly violate the con- 
 stitution by voting against the bank, yet, if I vote against it when I believe it 
 constitutional and necessary, it must be known that 1 vote in conformity to 
 the instructions of the Virginia Legislature; and, so far as my vote goes* it will 
 warrant and sanction that interpretation of the constitution which the Legis- 
 lature of Virginia lias given; which interpretation in conscience I believe to 
 be erroneous. Therefore, though in ordinary cases the instructions of a 
 Legislature may be imperative, (I will not determine that question) I con- 
 clude that they cannot be so when they require of a Senator to commit either 
 a positive or implied breach of the constitution, or to vote in such a manner 
 as to warrant such interpretation of the constitution as will deprive it of an 
 essential attribute. Virginia has the physical force, but has she a moral right 
 to violate the constitution of the United States? If she has it not, can she 
 give it to her Legislature? If her Legislature possess it not, can they give it 
 to a Senator? Can the Legislature give me a moral right to violate the con- 
 stitution of the United States, which I have sworn to support? I believe not* 
 sir, and that, in the situation in which I stand, their instructions ought to 
 have no operation on the vote I am to give on the subject under consideration. 
 To illustrate this question more fully, let me inquire, if a State Legislature 
 should instruct its Senators to vote lor a law to take away the trial by jury 
 in a criminal prosecution, would a Senator, thus instructed, who has sworn 
 to support the constitution of the United States, consider himself conscien- 
 tiously authorized to vote for such an unconstitutional measure? When a 
 Senator is elected, he is entitled to hold his seat for 'six years. Suppose that, 
 immediately after he is elected* the State from which he is sent, gets into a 
 state of direct opposition to, and insurrection against, the General Govern- 
 ment, and should continue so for the whole six years for which the Senator 
 is elected; does this vacate his seat? Will he not still remain in the Senate 
 of the United States* and, if he does his duty, vote for all measures that may- 
 be necessary to restrain the unconstitutional acts and insurrection committed 
 by his State? Either instructions on constitutional questions to a Senator are 
 imperative or they are not. We admit that a Senator retains his seat in the 
 Senate even while his State is engaged in actual insurrection and rebellion, 
 and, consequently, in the continued violation of the constitution of the United 
 States. While a Senator engages in the deliberations of this the highest 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 395 
 
 council of the nation, is he to obey the instructions of a State Legislature, 
 who are in the daily violation of the constitution of the United States, and 
 are endeavoring wholly to destroy it by open and declared insurrection, and 
 which Legislature will consequently instruct their Senators to pursue such a 
 course as will best accomplish the object it has in view? In this dilemma, if 
 instructions are imperative, which, if obeyed, violate the constitution, a 
 Senator will retain his seat in the Senate of the United States lor the express 
 purpose of using every means in his power to destroy that constitution which 
 he has .sworn to support. Can it be imagined that it was intended, in any 
 state of things, that a Senator should hold his seat in the Senate of the United 
 States, for the sole purpose of doing all he could to overthrow the constitu- 
 tion? Since so absurd, monstrous, and dangerous a principle would result, 
 from admitting the mandatory influence of instructions, when they touch 
 constitutional questions, I deem it my duty not to give my acquiescence to, or, 
 by my example, sanction, a doctrine so hostile to the general spirit, and so 
 unfavorable to the preservation of the constitution of the United States. 
 
 Much, therefore, as I respect the sentiments of the Legislature of Virginia, 
 and much as it distresses me to go in opposition to them, I believe I shall do 
 so on the present occasion. With respect to the alarm expressed by some 
 gentlemen, from the large States coming forward and instructing Congress, I 
 am satisfied that no such insidious motives are justly attributable to the Le- 
 gislature of the State which 1 have the honor to represent. I ara satisfied that. 
 us motives were honorable, pure, and patriotic; and this measure is a testi- 
 mony of the consistency of character of the State. When the charter of the 
 Hank of the United States was first granted, the general sentiment of Virginia 
 was, that this law was contrary to the constitution of the United States. /Un- 
 der a different state of things, and under the domination of a different political 
 party, than at the present time rules the affairs of this country, she preserves 
 a consistency of character. Believing the bank to be unconstitutional then, 
 she now entertains the same sentiment as when in (lie minority; and, with an 
 honorable consistency of character and anxiety to preserve, the constitution 
 inviolate, she has sent forward instructions to her Senators in Congress. 
 Whilst, therefore, I appreciate the motive which gave existence to these in- 
 structions, and highly respect the source whence they coiixe, and the high con- 
 sideration to which they are entitled generally, I do not, on the present oc- 
 casion, consider them obligatory as to the vote I am about to give. 
 
 Jn considering this question, I will take it in a three-fold view: 
 
 1st. Whether, on the first promulgation of the constitution of the United 
 States, a right did appertain to Congress to establish a bank? 
 
 2dly. As respects the constitutional question, whether, on an adjudged 
 case, and one long practised on, it has the same weight as it original? 
 
 3d. Whether, admitting that, at first, the bank was improper, because not 
 necessary, it be not now proper, if it can be proved almost indispensably ne- 
 cessary? 
 
 The first question, whether the General Government, when it first came 
 into operation, did not possess the power of creating a national bank, is the 
 primary object of investigation. In objection to this, it has been said, that, to 
 carry into effect an enumerated power, is one thing, and the right to incorpo- 
 rate a bank is a distinct power. Those who take this ground say, that the 
 creation of a national bank is an original, independent, and substantive power. 
 It is not sufficient, say they, to show that it is a convenient instrument to 
 carry into effect an enumerated power, because it is an independent authority 
 of itself, and the genius of our Government prohibits the derivation of any 
 powers by implication, with scrupulous limitation. It is true, sir, that our 
 Government, being an emanation from the existing State Governments, the 
 rational construction is, that all power riot given away is retained to them or 
 to the People. If that construction does not result, then a positive amend- 
 ment, which has been made to the constitution, has infused this principle into 
 it. 1, therefore, admit, in its fullest latitude, the construction, that all pow- 
 ers, not given away, are still retained: yet, I still co itcr.d, that, even in a go- 
 
596 BANK OF THE UNITED STATES. 
 
 vernment constituted like ours, there are some resulting powers. Or, by 
 what right do we create a military school? We have a right to raise armies; 
 but we can have an army without a military school. Yet it is constitutional to 
 create such an institution, because every given power implies rights inferior, 
 appertaining to the powers granted. We lay an embargo is there any clause 
 in the constitution authorizing us to lay embargoes? No, sir; we have a right 
 to regulate trade, and we have a right to lay embargoes to protect it. We 
 have a right to provide for arming and disciplining the militia. Under this 
 authority we build armories. Is there any provision in the constitution di- 
 recting it? We have erected forges, and even purchased ore banks. These 
 are interior powers, necessarily resulting from the greater powers granted. 
 But here gentlemen find the great difficulty. The creation of a corporation, 
 say they, is an act of sovereignty $ it cannot be used as a mean, because it is a 
 sovereign act. Why, sir ? every law passed is, quo ad hoc, a sovereign act. 
 A law. incorporating a military school, is as much an act of sovereignty, as to 
 the particular subject to which it relates, as an act incorporating a bank. We 
 create a military school for what purpose? Because the sovereign authority 
 has power to establish an army, and the power to create a military school is 
 inseparably connected with, and necessarily appertains to, it. We establish 
 a navy; we also establish a marine corps. There is no clause in the consti- 
 tution giving that power, but we take it, as inseparable from the power to 
 create a navy; because the exercise of the greatest implies every subordi- 
 nate power necessarily connected with it. The great stumbling block, how- 
 ever, is ? that this is one of those independent, original, and substantive pow- 
 ers, which cannot be given by implication. Blackstone says, " municipal law, 
 thus understood, is properly denned to be a rule of civil conduct prescribed 
 by the supreme power in a State, commanding what is right, and prohibiting 
 what is wrong." Agreeably to this definition, every law passed by a delibe- 
 rative body is an act of sovereignty as to the subject to which it relates. The 
 establishment of a marine corps is as much an act of sovereignty as an act in- 
 corporating the Bank of the United States. The only question is, whether it 
 be necessarily incident to the enumerated power given to the General Go- 
 vernment. Those who criticise most accurately on the constitution, and 
 most unwillingly concede resulting powers, will admit them to a certain ex- 
 tent, even in our Government. _Tne only question is the immediate and ne- 
 cessary connexion of the means used with the object intended to be attained. 
 In inquiring, then, sir, whether or not, at the first promulgation of the con- 
 stitution, when it came into existence, it was intended that Congress should 
 possess the power of incorporating the Bank of the United States, let us in- 
 quire whether there was any possibility of carrying into effect, with any toler- 
 able convenience and advantage, the several provisions of the constitution, 
 unless this power exists. It is said that you do not possess the power, be- 
 cause it is attempted to be derived, by different gentlemen, from so many dif- 
 ferent parts of the constitution. Now, Mr. President, I have never before 
 understood that a capacity to derive a title from several different sources, 
 gives you less title than if derived from one source alone. I derive the power 
 from the whole context of the constitution, although gentlemen seem to think 
 that the title is invalidated in proportion to the number of sections in the con- 
 stitution from whence we derive it. In order to avoid confusion of argument 
 in examining this question, I will derive it from only one source, at present, 
 though I believe others equally give it, by a necessary construction. At the 
 time the constitution came into existence, I believe there were but three 
 banks in the United States; none south of Philadelphia, and all of very limit- 
 ed capital. The constitution of the United States gives the power to levy and 
 collect taxes. Is it possible to imagine any system so convenient for the col- 
 lection of this revenue,and sending it to the seat of Government, as that of the 
 agency of banks? I am not inquiring whether the State banks can do it; but 
 I say that the trainers of the constitution must have had under consideration, 
 the state of things at the time when the constitution came into existence. At 
 that time there was not one bank south of Philadelphia; and the banks which 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 existed were very limited in their capital, and their paper of limited circulation. 
 Congress, in such a state of things, then, has the power of levying and collect- 
 ing taxes conferred on it, arid yet Congress has not the power to create banks 
 to aid in the collection of its taxes, notwithstanding a clause, to make all laws 
 necessary and proper for that purpose, is contained in the constitution. No 
 gentleman will say that the agency of banks is not necessary, in some way or 
 other, in collecting the revenue. I admit, without them you could have car- 
 ried on our fiscal arrangements in an awkward and cumbrous form; but was 
 that the intention of the constitution? When the power to collect taxes was 
 given, it was intended to give all the means necessary to carry this power into 
 execution. It was not to execute this power in a cumbrous form, but with 
 the greatest facility with which the power is susceptible of being wielded. 
 Now, is it possible that the constitution contemplated that the revenue should 
 be collected and transmitted here, subject to all the risks, and accidents, and 
 inconveniences, that attend the transportation of specie? It is impossible. 
 But all this doubt has arisen from its being a separate and independent power, 
 although it is no more of that character than any other law passed to execute 
 the enumerated powers of Congress. 
 
 In a word. Mr. President, it is admitted by all who have spoken on this 
 question, whether for or against the bill under consideration, that the agency 
 of a bank or banks affords the greatest facility and security of any mean that 
 can be devised for the collection of a revenue and for its transmission to your 
 treasury. 
 
 It is admitted that no bank or banks, of a capital, or of sufficient circulating 
 paper, throughout the United States, adequate to this object, did exist, when 
 the constitution was first formed, promulgated, or adopted. It is admitted 
 that, to levy and collect taxes, is one of the enumerated powers of Congress. 
 It is admitted that Congress has all power necessary and convenient to cany 
 its enumerated powers into execution. 
 
 It is admitted there is no express clause in the constitution prohibiting the 
 establishment of a national bank. 
 
 If these principles and facts are admitted, does it not demonstrate, beyond 
 the possibility of doubt, this unquestionable result, to wit: That, as Congress 
 i> to levy and collect revenue; that, as the agency of banks affords the most 
 certain, speedy, and convenient means by which a revenue can be collected; 
 that, as neither at the period when the constitution was made, promulgated, 
 or adopted, banks of sufficient capital or with paper of sufficient circulation 
 existed for the collection of the revenue and its transmission to your treasury; 
 that, as there was no positive clause prohibiting a National Bank in the con- 
 stitution; that, as Congress was to have all power necessary to carry its enu- 
 merated powers into execution; that, as the convention who framed and the 
 People who adopted the constitution, must have had in view our the existing 
 institutions and the then general state of society; it was the intention of the 
 convention who formed the constitution, and the People who adopted it, to 
 give to Congress the power of establishing a national bank. If, at the time 
 of adopting the constitution, it was necessary and proper that Congress should 
 possess it for the exercise of any of its enumerated powers; if me foregoing 
 result is undeniable, and I think it is; I would interrogate, if Congress, on the 
 adoption of the constitution, possessed a power to establish a national bank, 
 what has since deprived that body of the power? I ? Mr. President, can dis- 
 cover nothing which has. One argument, much confided in by gentlemen who 
 have opposea the present bill, is not that banks are not necessary to the col- 
 lection of the revenue, but, that State banks will answer. In return, I insist 
 that no State banks did exist when the constitution was first formed, there- 
 fore, the power to create a national bank, is necessarily given in the power to 
 levy and collect taxes. To this it is replied, that, to create a national bank, 
 is to legislate by implication; it is a separate, substantive, and independent 
 power; to levy a tax is one thing, to make a bank, another. I answer, to levy 
 a tax is one thing 1 , to create an officer for its collection, another. By this kind 
 of chop-logic, we may prove any thing unconstitutional. 1 ask, when you 
 
398 BANK OF THE UNITED STATES. 
 
 levy a tax, if you do not provide, officers for collecting it? I levy a tax, and 
 create a bank, through whose instrumentality I mean to collect it; from the 
 same authority by which I appoint a collector, I have a right to create a bank, 
 through whose instrumentality I mean to receive and transmit it. There is 
 no clause in the constitution, saying you may appoint officers for the collection 
 of the revenue, specifically; but the right to appoint officers to collect revenue, 
 is derived from the power of levying a tax, from which, also, may be derived 
 the power of establishing a bank, if it be the best mode of collecting the re- 
 venue. It is said, you may collect this tax by means of the State banks. Very 
 well, sir; I say you may collect the revenue by means of State officers; and, 
 upon the principle that you cannot establish a bank to collect the revenue, 
 because the Slate banks can collect it, I say that the State officers can collect 
 our taxes; and if your argument is just, you cannot appoint any other officers. 
 The constitution authorizes the President to appoint persons to fill all offices 
 established by law, but says not a word about appointing officers to collect the 
 tax you levy, specifically. Upon the construction gentlemen contend for, 
 they might say, because no power is expressly given to appoint officers of the 
 customs or for your taxes, and it is possible to collect the revenue by the 
 agency of the State Governments, and nothing should be done by the United 
 States' authorities which can be done by the States, therefore, these collectors 
 of the customs or revenue, should be such as are appointed by the States, tor 
 State purposes. This kind of reasoning, sir, cannot be admissible, and is in 
 hostility with a most manifest principle of the constitution; as it is evidently 
 a prominent feature of that instrument that the General Government should 
 have within itself, all those powers necessary and convenient for the execution 
 of its enumerated trusts, entirely free and independent of the interference 
 and agency of the States, their officers, or ministers. 
 
 It has been triumphantly demanded by some, whether we could create a 
 trading company. I have not a doubt on the subject. If it can be demon- 
 strated to me, that commerce would be benefitted by the incorporation of a 
 mercantile company; that it is indispensably necessary to do it, to regulate trade 
 to advantage; under such circumstances, I have no doubt, we can create a 
 company: for the creation of a company is no more the exercise of a sepa- 
 rate independent authority, than any law which we make when legislating 
 under our enumerated powers. If it be inquired, whether or no we could 
 incorporate a company to cut canals through the States, I answer, that there is, 
 in the constitution, a clause authorizing Congress to regulate trade between 
 the States, and, under this clause, we could do it with the consent of the 
 Stales. We could not do it without. And I derive this construction from 
 the constitution itself. It is a fair mode of construction, laid down by profes- 
 sional men, that, where there is intricacy or difficulty in the construction of 
 any legal instrument, you must take the context together; one part of the 
 instrument must be used to elucidate another; the different parts must be 
 compared, and the true construction thereby obtained. In the 8th section of 
 the hrst article, a power is given to Congress " to exercise exclusive legisla- 
 tion, &c. over all places purchased by the consent of the Legislature of the 
 State in which the same shall be, for the erection of forts, magazines, arse- 
 nals, dockyards, and other needful buildings." I discover here, that the con- 
 stitution, in order to preserve the sovereignty of the State Governments, has 
 been exceedingly vigilant in guarding their territorial rights. Therefore, 
 \vhere a power is ^iven to the General Government, interfering with the ter- 
 ritorial rights of the States, there is a clause in the constitution saving ter- 
 ritorial rights, and requiring the consent of the States to its exercise. If, 
 therefore, Government, in the exercise of its enumerated powers, is restrained 
 from acting, where their acts affect State territory, unless with the consent of 
 the States, I infer that we have not a right to incorporate canal companies 
 without the consent of the States through which the canal is to go. With 
 this limitation, I have little hesitation in saying that we have a right to incor- 
 porate canal companies. 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 399 
 
 It is said, (hat the corporation which it is proposed to re-charter, indepen- 
 dent of the facility it affords to Government in the collection of the revenue, 
 has, also, particular advantages given to it; that it is a monopoly. And what 
 right, it is asked, has Congress to grant a monopoly? I will ask, in return, 
 when an officer is appointed to collect the customs, has he not a salary and 
 emoluments? Is riot every office in law called a franchise or a particular 
 privilege? If the officer, who has these emoluments, privileges, or franchises, 
 (call them what you will) receives these in consideration for his services, 
 have you not the power to hold out inducements to associated bodies of men to 
 form an institution from which the public may derive benefit, not with a view 
 exclusively to their monopoly and benefit, but on account of the advantages 
 to be derived from it by the public? 
 
 If it is urged that, instead of this incorporated company, you mi^ht appoint 
 officers in the different ports of the States in which the greatest duties are col- 
 lected, and issue notes, or bills of credit, which are made current, without 
 creating a bank authorized to make discounts, I admit we might; but, if we 
 believe it not so convenient and safe a way of collecting our revenue, as 
 through the agency of a bank, we have the right to associate men in a bank- 
 ing company for this purpose, and give them particular privileges, upon the 
 same principles that we give privileges or franchises to every officer we ap- 
 point; and, although we thus confer, in both instances, privileges, it is done 
 for the public good, because the object to be effected can be accomplished by 
 no other means so effectually. If you want an association of men in a par- 
 ticular manner, to make them subservient to some political use, you have au- 
 thority to give to those associating men whatever privilege may be sufficient to 
 induce them to associate for this purpose. You do not give them this privi- 
 lege for their own individual advantage, but as the lure, the bonus for asso- 
 ciation, by which association the public object is effected. I would ask, 
 whether Congress could not, to-morrow, pass a law authorizing the President 
 to open a negotiation with Hope <S: Co.^saying, we h;iye full confidence in 
 you, and you shall be the United Stares* bankers? This may be said to be a 
 monopoly; but, if Congress were convinced that this was the safest means of 
 collecting the revenue, J ask, where is the clause of the constitution which, 
 in substance, or words, prohibits Congress from adopting such a measure? 
 If there be no clause to prohibit this, there is no prohibition to the passage of 
 a law for incorporating individuals in an association from \\hich the greatest 
 possible facility in the collection of the revenue is expected. In a word, sir, 
 it appears to me that the only rule, in an instance of this kind, is, to take 
 care that the means used have a necessary reference to the object of the 
 po\yer. AVhen legislating on the enumerated powers of Congress, the only 
 limitation is, an inquiry whether the means we are about to use, necessarily 
 relate to the effectuation of the object in view. For instance, 1 should con- 
 sider it a violation of the constitution^' Congress, under the power *' to make 
 rules for the government of the land and naval forces," should pass a law re- 
 gulating military testamentary devises; because the incident is too remote, it 
 is too great a stretch of power, the constitutionality or unconstitutionally 
 being regulated by the relation of the means to the object to be effected. If 
 this reasoning be just, then this question is not soluble by the mere determi- 
 nation of the question, whether or not this is the best system by which our 
 revenue can be collected; we must, to ensure its rejection on constitutional 
 grounds, prove that the power of establishing a bank is so remote from the 
 object of collecting the revenue, as to have no connexion with it. Admit that 
 a better system of collecting the revenue can be devised, than by the esta- 
 blishment of a bank; it does not follow that the bank is unconstitutional. The 
 only question is, whether it is so remote as that, by no satisfactory process of 
 reasoning, you can prove its analogy to the collection of the revenue. If it be 
 shown that a better system could be adopted, it only proves that this is inex- 
 pedient, not that it is unconstitutional; and, sir, it has been a matter of as- 
 tonishment to n:e, that, notwithstanding it was so universally believed, some 
 time since, that the agency of the bank was excessively conducive to the 
 
400 BANK OF THE UNITED STATES. 
 
 prompt and regular collection of the revenue, it is no\y discovered that its 
 agency is unnecessary. The gentlemen who are now of this opinion, thought 
 otherwise formerly, and the Secretary of the Treasury, who is best enabled 
 to decide the question, is of a different opinion from them. 
 
 In answer to those, sir, who say that State banks afford the facility neces- 
 sary to the collection of the revenue, I would ask, is the General Govern- 
 ment to be dependent on the State banks for the collection of the revenue ? 
 Or, do gentlemen believe they would be as secure and responsible as the Bank 
 of the United States ? As to the remark, that, in those States where there 
 are no banks, the revenue is collected with as much facility as where there, 
 are banks, I would reply, that, where there are no banks, there is, neverthe- 
 less, bank currency in circulation. Where the States have no banks of their 
 own, the notes of the Bank of the United States are in circulation, and the 
 customs paid in those notes. A national bank, I am under a strong convic- 
 tion, is, if not indispensable, highly conducive to a convenient collection of 
 the revenue; and if this bank be put down to day, before a long interval of 
 time we fehall have another bank. In my estimation, there ought to be a bank, 
 whose paper circulates freely throughout the States; other paper will not an- 
 swer the same purpose. I recollect to have been travelling where I had in my 
 pocket book, five hundred dollars in good bank notes; and yet I was com- 
 pelled to trespass on another gentleman, in company with me, to bear my ex- 
 penses. If the notes I had with me had been notes of the Bank of the Unit- 
 ed States, they would have circulated freely, because the merchants gladly 
 receive them from the planters, for the purpose of remittance, &c. But it al- 
 ways will be otherwise with State banks; from their nature they cannot give 
 that general circulation which is derived from a general bank. 
 
 The honorable gentleman from Kentucky, (Mr. CLAY) with his usual inge- 
 nuity, spoke of the enormous evil, and the danger to our liberties, that is to 
 be anticipated from giving the power to erect corporations, which, he says, is 
 an original power, and has given being to institutions which have swelled to 
 an enormous magnitude. The example of the East India Company and the 
 South Sea Company were spoken of in an alarming, impressive, and inge- 
 nious manner. ]3ut, I ask, sir, if the State Governments do not possess this 
 gigantic power ? I see nothing to restrain them, more than the General Go- 
 vernment. I see that the only supervisors, as to the State Governments, are 
 the People themselves, who are, also, the supervisors of Congress, who have, 
 also, the invidious, jealous eyes of the State Governments constantly upon 
 them, as is illustrated in the conduct of some of the States on this very ques- 
 tion, and who, combined, would guard this power from abuse by the General 
 Government, much more than the People atone will guard against abuses by 
 the States. It is a visionary mode of reasoning, to argue against the posses- 
 sion of power from the abuse of it. The gentleman may as well tell us that 
 AVC may raise armies to so monstrous an extent as to crush our liberties, and 
 therefore, we ought not, on any emergency, to raise an army. He may as 
 well say, the creation of a military school, which is as much, and no more, a 
 resulting power than the one in question, is giving to Congress a great sub- 
 stantive independent power to create a vast engine, under the name of a mili- 
 tary school, which may swell to such immense importance as to make it an 
 instrument to swallow all the liberties of the country. So, as respects sites 
 for forts and armories, and ore banks powers exercised by implication. The 
 gentleman, from the unlimited indulgence he gives to a gloomy and forebod- 
 ing imagination, may say you may purchase the territorial rights of the States, 
 until you destroy their sovereignty. There is no end to me extent of such 
 reasoning. We must rely, in some degree, on ourselves, on the vigilance of 
 the State Governments, and on the discretion of the People. When the whole 
 body politic is so corrupt that there are no eyes on our rulers, to see when 
 they transcend the powers of the constitution, all is lost, and no paper reser- 
 vations can save us. 
 
 From this reasoning, sir, I again reiterate, that I C9nclude that, when the 
 constitution was formed and promulgated, it was the intention of the framers 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 4Q1 
 
 of the constitution, and of those who adopted it, in the powers they gave to 
 the Congress of the United States, to include that power, and establish a bank, 
 if such an institution was considered convenient, necessary, and proper, to 
 carry into execution any one of the enumerated powers conceded to the Ge- 
 neral Government; anu, if it was constitutional then, it was equally so now. 
 
 In the course of the very elaborate and able speech delivered by my col- 
 league a few days past, on this subject, he stated these two positions: that a 
 right to grant charters of incorporation is not of a description of character 
 similar to, and has no analogy with, any of the enumerated powers of Con- 
 gress. 
 
 2d. That the right to grant charters of incorporation was a distinct and 
 sovereign power, equal in itself to any of the enumerated powers granted to 
 Congress. 
 
 As to the first position, that the right of creating corporations, or banks, has 
 no analogy to the enumerated powers of Congress, permit me to observe, this 
 is begging the question, or, rather, entirely evading it. If it is admitted by 
 every one (and this has been admitted) that banks afford the greatest facility 
 of collecting your revenue, and you have a right to avail yourself of the best 
 means to carry into execution your enumerated powers, the right to create 
 banks has an immediate connexion with, and grows out of, the power to levy 
 and collect taxes, which brings this merely to a question of expediency. 
 
 His second position was, that the right to create corporations, or banks, was 
 a distinct and sovereign power, equal, in itself, to any other of the enumerat- 
 ed powers of Congress; that it wants that connexion, affiliation, and subser- 
 viency, to some enumerated power, which is necessary to give a power by im- 
 plication. I know not that a law, granting a charter of incorporation, is more 
 an act of sovereignty, than a law passed on any other subject. That it is a 
 power original, independent, and of itself equal to any one of the enumerat- 
 ed powers, cannot be admitted, because it has not been contended by any 
 that Congress possess the power of creating corporations at all times, and in 
 all instances. It is only contended to be proper, and constitutional, when it 
 is used in subserviency to the enumerated powers of Congress, as the means 
 best calculated to carry any enumerated power into execution. The right of 
 creating incorporations for this purpose only, and under this limitation, can 
 never make it a power equal, in character and magnitude, to any one of our 
 enumerated powers, because, if it is used as a mere subservient instrument to 
 them, in that point of view if it can be demonstrated that they are a conve- 
 nient means to eftect a legitimate object my colleague must admit their con- 
 stitutionality, because he nas emphatically dwelt on that clause of the consti- 
 tution which gives to Congress the power to make all laws necessary and pro- 
 per; and to those who apprehend that this power may.be abused, and Con- 
 gress may attempt to exercise it in instances not within the pale of their le- 
 gitimate authority, I answer, they may also abuse any other power they pos- 
 sess. The only preservation is the virtue of our Legislature, and the vigilance- 
 of our People. 
 
 The next point which remains to be investigated is, whether the constitu- 
 tionality of the bill under consideration receives any support from its princi- 
 ples having been sanctioned by any former laws and measures of the Govern- 
 ment. 
 
 Mr. President, I am ready to admit that, where a measure obtains, that in- 
 flicts a violation on our constitution, that is unquestionable, palpable, and 
 notorious, however frequently and however solemnly this measure had been 
 sanctioned, however long it had been submitted to and endured, would not 
 be considerations with me of any importance, or create one moment of doubt. 
 Error, however repeated and submitted to, is error still, and every occasion 
 should be sought to get rid of it; but, on an occasion, in the origin of which the 
 constitutional question was doubtful, when men of the purest integrity and 
 most illumined intelligence might pause, and differ, and doubt, I should ima- 
 gine that such case, once acted on, should never again be touched, unless con- 
 siderations of irresistible importance lead to such a measure; and I imagine 
 51 
 
402 BANK OF THE UNITED STATES. 
 
 that every man of candor and intelligence, who weighs with due deliberation 
 the question under consideration, will at least adinit ? if the measure is riot 
 certainly constitutional, it is at least of that description of character I have 
 last mentioned. In such an instance as this, will it be said that, after this 
 measure has been sanctioned by Congress, on full deliberation and debate j after 
 the bill establishing this bank had received the approbation of the President, 
 who reserved his signature to it till the last moment permitted by the constitu- 
 tion; and after he had viewed the question with all its bearings in every atti- 
 tude it could be presented; after full consultation with his cabinet ministers, 
 and others of high intellectual character; after the law, thus sanctioned by the 
 Legislature and the President, has been acquiesced in and practised on for the 
 space of twenty years; when it has been considered inviolable, and corrobo- 
 rating laws passed during the administration and legislation of different domi- 
 nant political parties; when those laws have been sanctioned by the solemn 
 adjudication ot all our judges, both of the General and State Governments; 
 to suppose that all these considerations arc to have no influence as to putting 
 to rest a constitutional question, which was doubtful in its origin, is to be 
 sceptical and scrupulous beyond all reasonable bounds. If Congress have no 
 right to incorporate a bank, was it not an act of usurpation in the President 
 and Congress to pass laws punishing individuals for the forgery of its paper? 
 Nay, more, Mr. President, when we inflict death for the support of institu- 
 tions Congress had no right to create, and for the violation of laws the con- 
 stitution prohibits that body from enacting 1 , (and under the denomination of 
 each of the political sects into which this country is divided, agreeable to the 
 principles now contended for by gentlemen, such laws have been passed) are 
 not the Excutive which sanctions, the Congress which passed, and the whole 
 body of our judiciary, both of the General and State Governments, which en- 
 force such unconstitutional measures, and under their surreptitions authority 
 inflict death upon our citizens, worse than usurpers? Are they not murderers? 
 Yes, Mr. President, I reiterate, are they not murderers? And are we pre- 
 pared to pronounce so heavy a denunciation on our predecessors, on ourselves, 
 and the great departments of our Government? Are we ready to inform the 
 American People that this body, and all their constituted authorities, have 
 sported with the lives and illegally shed the blood of our citizens? My col- 
 league was foreman of the jury that pronounced sentence or that found a ver- 
 dict on the famous or rather infamous Logwood, for forgery of the paper of the 
 Bank of the United States. This verdict was confirmed by the judge of the court, 
 and the criminal punished agreeably to the judgment. Is a measure of such 
 weighty and awful import, so solemnly and deliberately acted on and decided, 
 and multifarious other decisions of the same description, to have noinfluence on 
 the decision we are about to give respecting the constitutionality of establish- 
 ing a national bank ? If they are not, then gentlemen view the subject through 
 a very different medium than that through which it is presented to my vision. 
 Then, in my judgment, Mr. President, our situation is alarming indeed. 
 
 This vibrating constitutional doctrine, to day one thing, tomorrow another, 
 as the domination of one party or the other or the passions of the moment shall 
 
 ?revail, will reducepur constitution to nothing, or render it a mere instrument 
 DF depraved men, it sach should get into power, to acomplish their wicked 
 purposes, and to destroy the liberties, and oppress the virtuous People, of this 
 country. It is a wise maxim of our municipal law, that, in novelty, there Ls 
 danger, but antiquity of law sanctifies error. If this principle is just, as it 
 respects municipal law, (and of this, in my judgment, there can be no doubt) 
 it is infinitely more so when applied to fundamental and constitutional prin- 
 ciples, which, when once fixed, on all questions of a doubtful nature, should 
 never again be agitated. The influence which the decision of the judiciary 
 may have on settling the constitutionality of the law incorporating the Bank of 
 the United States is not intended to be urged by me as an argument, which, in 
 my judgment, ought to be relied on, because I conceive it the duty of the ju- 
 diciary merely to expound what is the law of Congress; and to determine be- 
 tween a law and the constitution is assuming to the judiciary a power not ap- 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 4Q5 
 
 pertaining to it a power inconsistent with the genius of our constitution, and 
 such a one as, if exercised by any judiciary, under a popular Government, 
 will ultimately destroy the Government itself. The inference, therefore, which 
 is derived from the reasoning above insisted on, from the decisions of the 
 judiciary, is intended for those who insist that your federal judiciary have a 
 right to decide on the constitutionality of any lavy passed by Congress which 
 comes under its cognizance. The aid I myself derive from the source of 
 precedent, to support the constitutionality ot this measure, is solely from the 
 reiterated acts of different Congresses, and the approbation of different Presi- 
 dents, and the concurrence, under them, for the space of more than twenty 
 years, during the prevalence of different political parties. An attempt has 
 been made, by the honorable member from Tennessee, and others, to inva- 
 lidate the accuracy of the inference drawn from this principle of rjrecedencv, 
 by insisting that the bank law was in the nature of a contract with individuals, 
 by which private rights became vested, and therefore the Government was 
 bound to carry it into effect. The gentleman from Tennessee imagines that, 
 during the period of the republican administration and majority in Congress, 
 which acted upon this bank law, it was considered in the nature of a contract, 
 and as such, Government determined to carry it into effect with good faith, 
 and with that view passed the several corroborating lavVs which have been 
 from time to time enacted. But this reasoning, sir, of the gentleman from 
 Tennessee, has been so fully refuted by my honorable colleague, in the very 
 able speech he delivered on this question, some days past, as to obviate the ne- 
 cessity of further commenting on it. I will only repeat one remark that 
 was made by my colleague. If the bank law was unconstitutional at first, it 
 could not give any legal corporate existence to any body of men to form a 
 legal contract in a corporate character which had no such existence. There- 
 fore there existed no leaal contract; the faith of Government was not pledged; 
 it was like a contract with a married woman or an idi9t; it was, ipsofacto, void. 
 
 To recapitulate, I derive the power to create a national bank, when this con- 
 stitution came into existence, from the situation of society, and our legal in- 
 stitutions at that time, and the difficulty, as things existed, that the revenue 
 could be collected with advantage, in any other way than by the agency of a 
 bank. If this reasoning be deemed erroneous, t insist that the constitutional 
 power of Congress to create a bank was, in the first instance, doubtful, and 
 the principle having been recognised, and having received every sanction the 
 Government could give, and practised on for more than twenty years, is not 
 now to be called in question. 
 
 Admitting that, on both these points, my views are erroneous; say that the 
 establishment of the bank at its commencement was improper ? still, if it be de- 
 monstrated that the existence or re-chartering of the bank is indispensable, 
 or highly expedient, at present, to the due exercise of enumerated rights of 
 Congress, that which was improper, or, even, perhaps, unconstitutional, at first, 
 because it was not necessary, becomes constitutional and proper, because now 
 expedient or essential. Congress are clothed by the constitution with a va- 
 riety of delegated rights. Now, admitting that the establishment of a bank, in 
 the first instance, was not necessary for the due exercise of the legislative 
 rights bestowed in any one of these enumerated powers, if pur predecessors 
 in office, by the creation of a bank, which, at best, was an improper institu- 
 tion, because not necessary, have placed our fiscal concerns in such a situa- 
 tion that it cannot be put down without great injury to the revenue, which 
 Congress is bound to levy and collect without injuring our commerce, with- 
 out impairing our public credit, without lessening the public welfare, all of 
 which Congress is bound to provide for and protect if this can be demon- 
 strated to be the probable result of pulling down the bank at this period, I 
 would ask, whether that institution which was improper at first, because not 
 necessary, does not become proper, because almost indispensable at present? 
 
 In construing the constitution of the United States, when legislating on the 
 enumerated powers of Congress, I lay down this rule of construction: that the 
 only limitation to the power of Congress is, either some positive or implied 
 
404 BANK OF THE UNITED STATES. 
 
 prohibition in the constitution itself, or the exercise of an honest and sober 
 discretion. If, therefore, there is any reason to believe, at the present period r 
 and existing state of things, that, by putting down the bank, your revenue will 
 be greatly impaired, your commerce will be injured, the public credit lessen- 
 edall of which Congress is to protect does not such a state of things make it 
 proper that that bank, which ought not to have been created, because not ne- 
 cessary, now ought to be continued, because indispensable? It may here be 
 said that I am varying the constitution, if I say that a thing is proper to day, 
 which was not proper five and twenty years ago; that this vibration will al- 
 ways keep the constitution in an uncertain state. I say no. My doctrine is 
 subject to no such accusation; the principles of the constitution are uniform 
 and unalterable. It is an uniform and unalterable principle, that Congress- 
 have the povyer to lay and collect taxes; they have the same positive un- 
 changeable right to exercise all the enumerated powers, the only rule of con- 
 struction relating to them being, that the means you use have a necessary re- 
 lation to the power on which you legislate. If the means be not enumerated, 
 you exercise discretion as to the means, having a regard to the existing state 
 of things when you legislate concerning them. The same means may be ne- 
 cessary and proper now which would not have been twenty years ago; you 
 change the means to attain the end, but the end itself, the enumerated power 
 in the constitution, remains unchanged. As long as the constitution exists, 
 you must select the means most proper for executing the enumerated rights,. 
 at the precise moment at which you legislate respecting them. If this be the 
 true construction of the constitution respecting the re-chartering of the bank, 
 the question merely resolves itself into an inquiry how tar such a measure is, 
 at present, expedient. To determine, at this moment, whether or not it be 
 constitutional, or, in other words, expedient, to incorporate the Bank of the 
 United States, I am to say whether, under existing circumstances, in the 
 present state of society, situation of trade and revenue, the preservation and 
 continuance of this institution is essentially necessary. If it be essentially 
 necessary, we have a right to re-charter the bank. 1 have been precise in 
 stating this view of the subject, because it has not before been taken by any 
 other gentleman. 
 
 With respect to the expediency of re-chartering this institution, lam some- 
 what surprised that any doubt should be entertained. It appears to me that 
 gentlemen have become incredulous, beyond all possible bounds. I believe, 
 sir, it was a wise saying of the sage Plato, that incredulity is the fountain of 
 knowledge. But, even to this maxim, there must be some limit, as seems to 
 be illustrated on the present occasion, when incredulity has been carried be- 
 yond all reasonable bounds. When general distress is in view; when alt 
 around us is- proof of the fact; when men in the best credit, men who have 
 heretofore had the greatest command of money, now feel the want of it; when 
 there is a general cry of distress from your large towns; when our table is 
 loaded with petitions from all orders of people in our country, depicting, in 
 the most vivid colors, their present sufferings and gloomy anticipations; when 
 the surrounding banks are curtailing one-half of their accommodations; when 
 our,whole commerce is paralyzed by the various aggressions it has experienced, 
 and by the shock which the agitation of this question has already given it;* for 
 gentlemen to shut their eyes to the effects of the dissolution of this institution,, 
 is. to me, astonishing. In another point of view, how can it be questioned? 
 The honorable gentleman from Maryland, whose knowledge we have all bene- 
 fitted by, and acknowledged on various occasions, has said, what is most un- 
 questionably true* that money is like any other article of trade, valuable in 
 proportion to its abundance or rarity. Then, if you strike out of circulation 
 the increased capital circulated by the Bank of the United States, is not a 
 relative scarcity to be expected? But, it is not merely to the extent of the in- 
 creased capital circulated by the Bank of the United States, that money will 
 be driven out of circulation. Those gentlemen who tell you that the State 
 
 banks, in this period of calamity and distress, can afford sufficient accommo- 
 dation, are, in my estimation, infinitely mistaken. 
 
 The State banks will, in 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 4Q5 
 
 the first instance, frequently tend to increase the evil. The same men who 
 have accommodation in the Bank of the United States, very frequently have 
 it, also, in the State banks. The Bank of the United States, finding it neces- 
 sary to settle its accounts, is anxiously employed in drawing into its vaults all 
 the money it can, to settle its affairs. The State banks, knowing there will 
 be a run upon them, are also drawing in the money due them by the very in- 
 dividuals whom it is imagined they can accommodate by extended loans. 
 Those State banks, which were to relieve the merchants, &c. will join in the 
 pressure; in order to secure themselves, they must produce the same curtail- 
 ment to their customers which is used by the Bank of the United States. So, 
 that, not only will the amount of the capital circulated by the Bank of the 
 United States be driven out of circulation, but much, also, for a time, of that 
 paper which the State banks were in the habit of issuing to individuals. It is 
 impossible to say to what extent the circulating medium will be diminished; 
 that it will be to a great extent, for a short time, there can be no sort of doubt. 
 And the depression of the price of flour, at this period, is proof that the present 
 apprehensions have already produced this effect: for, although I would yield 
 much to the superiority ot information of the gentleman from Maryland on 
 mercantile affairs, as on most others, yet, in this instance, his information is 
 not, in my estimation, correct. It is a notorious fact, that flour is DOW in as 
 great demand as ever it has been, in Cadiz, Lisbon, and Gibraltar, It is not 
 long since I saw an account of flour having sold at twenty dollars, at Gibral- 
 tar. Now, sir, if a merchant here knew he could get this price there, of from 
 eighteen to twenty dollars, as is unquestionably the fact, would a temporary 
 depression of the prices at Liverpool, as has been imagined by the gentleman 
 from Maryland, have any effect nere? None at all. tf our merchants could 
 get eighteen or twenty dollars at Lisbon, the depression of price at Liverpool 
 would not have the least operation here; it is an unquestioned fact, that the 
 price in the ports 1 have mentioned is constantly kept up; and yet the price 
 did fall, at the moment the bank question was thought to be decided: I think 
 it fell two dollars immediately; and it was, no doubt, from the difficulty of 
 obtaining money, which, it was supposed, would result from the dissolution 
 of the Bank of the United States, that this article fell. AVhen you diminish 
 the quantity of money which is to represent the articles of trade brought to 
 market, I do not want the gentleman's mercantile knowledge to inform me. 
 It is a plain proposition, that such a measure goes to depress the price of the 
 article brought to sale. That the destruction ot the Bank of the United States, 
 as it will lessen the circulating currency, for a time, must go to depress the 
 price of produce, is unquestionable, and will also diminish, for a time, the cir- 
 culation of the notes of other banks, because they must reduce their discounts. 
 This effect may be but temporary, but will exist to a certain extent. 
 
 The gentleman from Maryland has observed, that no apprehensions are en- 
 tertained by the people of Baltimore, on account of the dissolution of the 
 United States' Bank. ! think I have been informed that one of the most 
 wealthy men in that town has said he had a vessel to load, and knew where 
 he could send her, so as to clear six dollars per barrel on flour; for that flour, 
 at this period, could be purchased here, at eight dollars, and might be sold 
 abroad for eighteen; but, in consequence of the entirejimpossibility of obtain- 
 ing money from the banks at present, from the fear entertained respecting the 
 dissolution of the Bank of the United States, it was not in his power to load 
 his vessel. Such, sir, 1 have been advised, is the situation of one of the weal- 
 thiest men of that town. The Bank of Columbia has, at one stroke, lessened 
 its discounts fifty per cent, in consequence of the apprehension entertained 
 respecting the dissolution of the Bank of the United States. What has the 
 gentleman from Massachusetts told you? That $400,000 dollars are loaned 
 to the people of this District, by the Bank of the United States. What will 
 be the effect, in this little District, of drawing three or four hundred thousand 
 dollars out of circulation? Sir, to tell me that the reduction of circulating 
 medium will not produce] (it may be but for a short time) a correspondent 
 reduction of the prices of produce, is to tell me that I cannot se the noon- 
 
406 BANK OF THE UNITED STATES. 
 
 day sun. How long this reduction of the circulating medium, and the conse- 
 quent depression of prices, may last, it is difficult to say. 
 
 When the numerous late failures and bankruptcies are spoken of, what is 
 the reply? That they do not proceed from a want of bank accommodation, 
 but from the protesting of bills abroad; that our merchants have much pro- 
 perty abroad, but the difficulty of obtaining returns for it, has been such as to 
 embarrass our strongest houses. Is this a reason why we should accumulate 
 difficulties on our merchants? Fifteen or twenty millions are said to be tied 
 up in foreign countries, more especially in England, and such is the situation 
 of England, that we cannot get remittances from there. This is an admira- 
 ble reason, sir, indeed, for selecting this particular moment for calling on the 
 merchants to make an immediate payment, to the amount of fourteen millions, 
 vyhichthey owe this institution, and which, if put down, it is reasonable to be- 
 lieve, will require immediate payment. 
 
 This is regulating trade with a witness. By the annihilation of the Bank of the 
 United States, a considerable portion of our circulating medium is destroyed. 
 At the same period, our merchants are called on to pay their debt to the 
 United States' Bank, to the amount of fourteen millions, and their revenue 
 bonds amount to about twelve millions. This, too, at a period when the 
 funds of our merchants, to a great extent, are in England, and cannot be 
 withdrawn. 
 
 To me it appears that the situation of the country;, as respects commerce, 
 and every thing else, makes it important, at this criss, above all others, that 
 this institution should be preserved. 
 
 But gentlemen, and very intelligent gentlemen, tell us, this is a mere mo- 
 mentary pressure; that the money in the Bank of the United States, and the 
 revenue, as collected, will be deposited in other banks, who will issue paper 
 or specie, in proportion to the additional capital in their banks; that there will 
 be a mere temporary vacuum, which will soon be filled. If I am to be placed 
 jn an apartment, from which all respirable air is exhausted, and for a very 
 short time to remain there, but till all vitality is extinguished, it will truly 
 be a delightful consolation, previously, to advise me that this vacuum is tem- 
 porary, and, after I am destroyed, the equilibrium will be restored, and fresh 
 air admitted. Precisely of this nature is the consolation afforded to your ru- 
 ined merchants and others. What avails it, if the cause be momentary, but 
 the effect, as to them, be permanent? This awful moment will bring perma 
 nent destruction to thousands. And, for what purpose do we produce this 
 destruction? To get rid of the foreign influence produced by the stock held 
 by foreigners. Yet, sir, this foreign capital is one of the most beneficial con- 
 sequences attending the bank institution. 
 
 In a new country, constantly developing new resources of every descrip- 
 tion, an increasing population, increasing commerce, agriculture, manufac- 
 tures, and multiplied objects on which capital can be employed to great ad- 
 vantage, to develop Jhe wonderfully increasing energies and resources of our 
 young country, we can afford to pay foreigners good interest for the use of 
 their capital. This is one of the great reasons, with me, in favor of the bank. 
 We are admonished, that this foreign capital gives to foreigners a dreadful 
 political influence. Admit the assertion; which, however, is not true. Who 
 invited it here? The Government itselL We, ourselves, sold this stock to 
 foreigners. Our Secretary of the Treasury, with the knowledge and consent 
 of the Government, bargained and tranferred great part of it. Is this good 
 faith, is it honorable and just? After we have received a bonus for the trans- 
 fer of the stock to individuals, under the idea that the charter was inviolable 
 and secure, to destroy the institution to get rid of this foreign capital, which 
 we ourselves had invited here? If these moneyed banking institutions are 
 those horrid engines of political influence and corruption some have contend- 
 ed for, the only way to obtain any good they afford, and yet avoid their dele- 
 terious effects, is to get foreigners to send their money hew., and invest it in 
 our funds. We get the benefit of their money, while we are so far removed 
 from them that they can have no operation on us: for, sir, it is notorious to 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 497 
 
 those who are informed on the subject, that we feel less inconvenience or po- 
 litical influence from foreigners who hold stock, than from natives who possess 
 it. This inference must be obvious, when I state, that foreigners who hold 
 stock, have no vote in the choice of directors. 
 
 Again, sir, is not the critical situation in which we stand in respect to our 
 foreign relations, a particular reason why we should not, at this time, make 
 experiments which may injure the public revenue? If we enforce our non-in- 
 tercourse law, and England attempts to resist it, and force her imports into 
 our country by Florida, and our southern frontiers on one side, and Canada 
 and Nova Scotia on the other, it is at least questionable, whether our revenue 
 will not be greatly diminished. In our present unsettled situation, with our 
 merchants staggering under the weight of the non-intercourse, embargo, and 
 foreign spoliation; is this a moment to try experiments, that may have the ef- 
 fect of reducing our revenue, by crippling our mercantile enterprise, and 
 forcing our merchants to withdraw their funds from commerce, in order to 
 pay their bonded duties and bank debts? But, will the destruction of this 
 bank rid us of the dreaded influence of foreign capital? No, you get in its 
 stead an influence infinitely worse; you encourage speculation, which will 
 produce an evil of an infinitely more pestiferous kind. If this bank be put 
 down, another, ere long, I have no doubt, will be created: for, that another 
 bank must and will be created, is avowed by many who vote against continu- 
 ing this; and whenever this takes place, a scene of stockjobbing will ensue, 
 to an extent which cannot be now calculated. When a new bank and a new 
 stock is created, although by prohibiting foreigners to be subscribers in the 
 first instance, it wilTat first be taken up by our own citizens, yet, if the Eu- 
 ropean capitalist finds it to his advantage to have money here, he comes and 
 purchases our stock; our citizens, in the subscription to the new stock, engage 
 in a scene of the most debasing speculation; our citizens afterwards sell this 
 stock to foreigners, whose foreign influence we wish to avoid; and after having 
 gone this vicious,circle, we arrive precisely at the point where we started. The 
 same foreigners who now have so much of this bank stock, will re -invest their 
 money in the stock of the new bank to be created. This dissolution of the 
 bank, then, is trying wild visionary experiments, possibly, in its consequences, 
 convulsing society to its centre, sporting with the feelings and happiness of the 
 country, impairing mercantile credit and enterprise, injuring the tranquillity 
 of many of our most meritorious citizens, who see ruin hovering over them 
 from the measure we seem like to adopt; and, after all this is done, we come 
 round to the precise point from which we commenced. 
 
 It has either suggested itself to my mind, upon reflection on the subject, or 
 it is an idea suggested by some political writer, (and I think the latter is the 
 case) either Hume, or Smith, or both, that a gradual, silent, and almost im- 
 perceptible increase of money, or circulating medium, has the happiest effects 
 on society, and operates as the most saluary stimulus to the exertions and in- 
 dustry of a nation, because it operates as a gradual, though, perhaps, nomi- 
 nal premium to industry, by increasing the price of every article that is 
 brought into market; and the influence which the discovery of the mines of 
 South America had on the European world, by bringing into circulation an 
 increased quantity of the precious metals, is instanced, as well as I recollect, 
 by some of the economists, as an illustration of this observation: for the in- 
 crease of industry, of the arts, and of all social comforts, which soon follovyed 
 this event, has been remarked by several political writers. If this invisible 
 increase of the circulating currency of a nation is, from the causes above- 
 mentioned, productive of such happy effects, will not the immediate extin- 
 guishment of a great national bank, and the consequent diminution of the cir- 
 culating currency of your country, have an immediate opposite and baneful 
 operation upon society? Will it not produce a temporary depression of prices 
 of many of the necessaries and luxuries of life, and, to a certain extent, lessen 
 and benumb the vigor and exertions of our citizens? It is true, this effect may 
 be temporary, because new banks will remove the evil; but is there any rea- 
 son to produce this evil even for a moment? or, in other words, should we pro- 
 
408 BANK OF THE UNITED STATES. 
 
 duce this deleterious effect, for one moment, by the destruction of one bank, 
 that we, or the States, by the erection of new banks, may remove the evil we 
 ourselves have created? This seems to be producing a calamity, that we may 
 either remove, or mitigate it. 
 
 The bank, it has been objected, has been used as an instrument of improper 
 political influence. 
 
 Let it be remembered, Mr. President, that I am not advocating the mere 
 renewal of the charter of the Bank of the United States. I am only for re- 
 chartering it on certain conditions, or, in other words, with a view that it may 
 subscribe to the amount of its capital to a newly created bank, on different 
 principles, of larger extent of capital, and with a portion of the directors ap- 
 pointed by the Government. This, sir, will effectually prevent the directors 
 from using the bank as a political engine against the Government itself, and 
 obviates every objection on this head. Witness the Bank of Virginia; how 
 effectually is such an operation guarded against, there, by such a provision. 
 
 I have no sympathy for the directors of this bank, who are said to have im- 
 properly exercised this political influence; all my sympathies are in opposition 
 to them. It is not for the benefit of, or tenderness for, these directors, that 1 
 advocate the bill on your table. I know none of them, nor care any thing 
 about them, further than not to do them injustice. They may have conducted 
 themselves exceedingly improperly I believe they have done so, many years 
 past, on some occasions but this is not the way to seek redress for their mis- 
 conduct. Sir, I have heard of a man, who, when irritated, in order to obtain 
 satisfaction, would seat himself on a chafing dish of hot coals. The mode which 
 is proposed to punish the directors for their real or supposed misconduct is 
 equally wise in this instance. I would not injure the public welfare, and heap 
 ruin on very many innocent men, for injuries long since committed, if at all, 
 by these directors, and which never can be revived. Besides, this evil is 
 gradually correcting itself. When there was only the Bank of the United 
 States, or very few others, the consequence was, that it was a species of favor- 
 itism to get into the banks, and a privilege extended only to particular 
 friends. 
 
 But, at the extent to which banks are carried at present, in the northern and 
 middle States, to which the operation of the Bank of the United States is 
 principally confined, it is not a species of favoritism to obtain bank accommo- 
 dation. In the city of Philadelphia, before the late alarm, produced by agita- 
 ting the question we are now discussing., every man, who could produce good 
 paper, might get as much accommodation as he pleased; and to this extent 
 banks should always be carried, if once commenced. This is a remedy for 
 favoritism, and prevents the bank from being formidable as a political engine. 
 If we go to banking at all, let it be so that alj good paper can be accommodat- 
 ed. When the banks compete for paper, it is then not a system of favoritism. 
 They rather seek for customers than select them. Such was the situation of 
 Philadelphia. What is the consequence of a contrary system ? in Richmond? 
 In consequence of the erection of a bank there, with a little pitiful capital, the 
 discounts got into the hands of a few favorites, and Richmond is stated by 
 some to have almost become a nest of shavers. Those persons who are fa- 
 vorites, go into the bank, get accommodated with large discounts, on the 
 strength of which they shave the paper of others; but, in Philadelphia ,the situ- 
 ation is essentially different, from the redundancy of banking capital. Thus 
 the evil of political oppression and intolerance, to which the Bank of the Unit- 
 ed States is said to be instrumental, is cured by the establishment of other 
 banks; but it is possible that, to a certain extent, the undue influence of banks 
 generally may be revived, by putting down the Bank of the United States, 
 and creating a want of ban king capital in the community. If there be a greater 
 demand for discounts than can be met by the remaining banks, after that of 
 the United States is destroyed, then you revive, with the remaining banks, 
 that power of political influence and favoritism which you are so anxious to 
 avoid, and increase the calamity you deprecate, by the very means you take 
 to avoid it. 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 4QQ 
 
 In a perfectly well regulated state of society it seems to me things should 
 be so ordered, if it can be effected, that every individual of the community 
 should obtain loans of money on reasonable! nterest, to any extent for which he 
 ca n give ample security, In such a state of things an opportunity is afforded 
 to bring into action and to develop all the resources of the nation, to im- 
 prove its agriculture, its manufactures, its commerce, and all the social arts, 
 to the greatest possible extent. Such was the state of Holland, such 
 the state of England, before the present disturbances in Europe; and mark 
 the result. Each country polished and improved like a garden,, their com- 
 merce extending over the world, and all the discoveries and arts which en- 
 rich and adorn social life, carried almost to the utmost limits of perfec- 
 tion. This state of things can be effected in this country only by the agency 
 of banks; as we Tire every day increasing our population, commerce, andagn- 
 culture, &c.> and bringing into action an increased quantity of objects on 
 which money can be advantageously employed, a proportioiiably increased 
 quantity of circulating medium or of banking capital is necessary, to keep pace 
 with the improvements and progress of society. If this reasoning is just, it 
 is surely improper to destroy our greatest moneyed institution, and consequent- 
 ly banish from circulation a portion of the circulating medium, at a period 
 when the state of the nation is capable of employing, to useful purposes, a 
 larger capital than at a former period. If it is apprehended that, by affording 
 this facility of borrowing money to the extent I have insisted on, to every in- 
 dividual who can give security,* incautious men will ruin themselves, I an- 
 swer, they will do this in any state of things. To argue against the use of an 
 institution from the possible abuse of it, is not a just mode of reasoning. A 
 sensualist may destroy himself by excesses in the enjoyment of the table; yet 
 more temperate men will eat their dinner. That society should be deprived 
 of the use of an institution from which its prudent members can obtain great 
 advantage, because imprudent people will be ruined by it, is to tax the valu- 
 able members of the community for the benefit of the unworthy. I am in- 
 formed, Mr. President, that, for some years past, in the State of Pennsyl- 
 vania, any citizen of that State could obtain, on good security, from the banks, 
 as much money as he wanted. Sir, what astonishing progress has she made 
 in every kind of improvement and in eveiy species of wealth. Look at the 
 State which I have the honor to represent, whose apprehensions about bank- 
 ing institutions have made her averse to the extension of such establishments. 
 The result has been, that, notwithstanding she is, perhaps, the greatest agri- 
 cultural State in the Union, furnishing more copiously, (and the most valu- 
 able) articles of export, and possessed of all the materials of commerce, she 
 is destitute, in a comparative degree, of commerce itself. When cargoes of 
 wheat, flour, or tobacco, are wanted in Europe, a merchant of Philadelphia is 
 applied to to furnish these articles, though they are to be purchased in Vir- 
 ginia. Wherefore? Because, having no banks in Virginia that are adequate 
 to the wants of society, our merchants cannot afford to advance the money, 
 purchase the cargo, and draw for the amount On the contrary hand, the 
 Philadelphia merchant can go into a bank, get as much money as he wishes 
 to purchase a cargo with, send it on to Virginia and make the purchase, and, 
 after the vessel is loaded, draw on the owner for the amount of the cargo and 
 his commission. Comparatively speaking, all mercantile profit is drawn from 
 us; our produce is exported and our imports imported by the merchants of 
 other States, who derive all the profits ot our commerce, which, in a differ- 
 ent state of tilings, would remain with us, and constantly increase the wealth 
 and resources ot the State. I have been induced to enter into this train of 
 reasoning and statement of facts, in order more clearly to illustrate this posi- 
 tion, to wit: that, in order to prevent a banking institution or its directors 
 from having a political or other improper influence, it was not necessary to 
 destroy an institution which was in itself useful, but to correct its abuses by 
 extending the banking principle till all good paper could be accommodated. 
 I have stated that, in Pennsylvania, until the present alarm which this dis- 
 cussion has produced, any person deserving credit, could obtain it to any ex- 
 52 
 
410 BANK OF THE UNITED STATES. 
 
 tent he wished. The banks, in such a situation, compete for customers, and, 
 in such a state of things, their political influence is gone. In Virginia, on the 
 contrary, in consequence of the limited capital of the bank being very inade- 
 quate to the demands of society, it is a matter of special favor to get into 
 the bank. A banking capital, to this limited extent, is an injury to the com- 
 munity: for, in such a state, the bank not being able to accommodate all, must 
 select its favorites, which gives to them particular advantages, which others 
 do not possess, and enables them to apply to usurious purposes the money they 
 get out of the bank, by lending it to others, who, if there was a sufficiency of 
 banking capital, would themselves go into the bank and be accommodated 
 with that very money for which they now pay an usurious interest. Such a 
 bank is an evil, and in such a state of society, where there exists such a diffi- 
 culty of loaning money, a man worth $20,000 may have his fortune sacrificed 
 to pay 5,000. This statement will clearly illustrate the object I have in view, 
 which is to show that, by extending the banking system to the proper extent, 
 if you once commence it, you destroy its political influence, and prevent it 
 from being an instrument of either public or private oppression. Such is the 
 situation of the Bank of the United States at present. Whatever may be the 
 disposition of their directors, they are incompetent for all the purposes of in- 
 fluence. 
 
 [Mr. GILES said it was with, regret he interrupted his friend; but he seemed 
 to suppose that the banking capital at Richmond was so small as to convert 
 that city into a society of shavers. This was not correct. He (Mr. G.) had 
 a conversation with the president of the bank, from whom he understood that 
 the bank could do more paper than was offered to it.] 
 
 Mr. BRENT said he had heard no positive information as to the fact he stat- 
 ed; but it was well known that men as good as any in the United States had 
 not been able to get their paper accommodated. He knevy the president of 
 the bank, for whom he had a sincere veneration and affection; no blame at- 
 tached to the bank. He said that the establishment of a bank any where, 
 however pure, provided it was not adequate to the wants of society, would 
 produce shaving. 
 
 Mr. B. said he had many other remarks which he wished to submit, but the 
 hour was so far advanced he would not trespass further on the attention of 
 the^ Senate at present. If a fit opportunity should hereafter occur, he might 
 again take the liberty of making a few observations on this subject; but he 
 would avail himself of this occasion to say, that he did not mean to make any 
 reflection on the directors of the Bank of Virginia they were not, in the 
 smallest degree, censurable. He believed the affairs of the bank were ably 
 and honorably conducted by them. 
 
 FEBRUARY 19, 1811. 
 Motion to strike out the first section. 
 
 Mr. TAYLOR. Mr. President: Although much time has been consumed in 
 the discussion of the subject before us, and the ground completely occupied 
 by those who have gone before me, yet the importance of the subject, the im- 
 mense magnitude of the unhappy consequences likely to result to the nation 
 from the rejection of the bill on your table, compel me to offer to it all the 
 support in my power. Indeed, sir, to this sense of duty to the nation is super- 
 added a very sacred, and to me dear and indispensable duty my duty to the 
 State which 1 have the honor in part to represent as well as another duty 
 which, from the course which the debate has taken, is not to be disregarded I 
 mean, sir, the duty which I owe to myself. 
 
 I cannot, as other gentlemen have boasted they can, put my hand into my 
 drawer, and pull out the instructions by which I am to be directed on this im- 
 portant subject. 
 
 The State of South Carolina is a very large stockholder in some of her 
 State banks; and if a selfish policy, contracted to the narrow sphere of the 
 unique advantage in dollars and cents of the Government of that State, in con- 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 tradiction and disregard of the interests of the great body of her own citizens, 
 and the citi/.ens of the rest of the States in the Union, could have weighed a 
 moment with her Legislature, I too might have been instructed. Let me not be 
 Understood, Mr. President, as drawing any comparison between the conduct 
 of the State of South Carolina and the conduct of great and leading States, 
 who have acted otherwise; but. I must and will tell of the things that I do 
 know. I rejoice, sir, that the State which 1 come from has. in this instance, 
 been actuated by that magnanimity and patriotism which on all former occa- 
 sions has distinguished her conduct; that neither selfishness nor party rage, nor 
 a spirit of intolerance, has induced her to counteract or embarrass the National 
 Legislature in its pursuit of the great object of its institution Me good of 
 the ?,'7/c/e. 
 
 I hope it will not he considered as savoring of egotism, when I say that 
 my appointment to the very honorable station 1 now hold was unsolicited by 
 me. That my sentiments on the subject now under consideration had been, 
 by me, unequivocally expressed at the last session oi'Congress, and were well 
 known to those who appointed me; nay, further, after my venerable and re- 
 spected predecessor had resigned his seat here, and had declined also his ap- 
 pointment lor the ensuing six years, pending- the election of a successor to 
 nim, and when my name was held in nomination, a resolution was offered, 
 similar to those which we have heard so much talk about, proposing to instruct 
 the Senators of that State to oppose ih<- renewal of the charter of the Bank 
 of the Tinted States. This resolution, as I am informed, lay on the Speaker's 
 table when tin* election W;H gone into. I was elected: and the proposers of 
 the resolution had not power or influence enough to raise it from the table on 
 which it lay, and it died tifi/t l;nm at -ion; and if I were 
 
 to make an inference, at all. on these transaction?, I should suppose I was 
 tacitily instructed to \<;tc for the renewal of the hank charter. But I 
 seek not the avoidance of responsibility. It is here, sir, (in my own bo- 
 som) J have instructions paramount to all others: my beloved country has 
 rested the matter here, and my gratitude is superadded to all other moral obli- 
 gations operating on me to perform this trust and toexcute this duty with faith- 
 fulness. I find the authority of ( n irr.int this charter in the same 
 sections of the constitution which the getlemen wha have gone before me have 
 pointed out to you. In section 7th, clause; 1st, pmvc.r is given to Congress 
 * 4 to lay and colled frm'.v, duties, imposts, and excises, to pay the debts and 
 provide for f fie ronnnnn ({(fence ;md general welfare of the United States; but 
 all duties shall b? uniform throughout the United States." 
 
 Clause 2d gives the power "to borrow money on the credit of the Unit- 
 ed States." And in the last clause of said section, power is also given to 
 make all laws which shall be necessary and proper for carrying into execution 
 the foregoing powers, vested by this constitution in the Government of the 
 United States, or any department or officer thereof. 
 
 Let us understand the meaning of the words necessary and proper, in the 
 last quoted clause: for, upon a correct knowledge of these depends, in my opi- 
 nion, the correctness of our conclusions on this subject. The word necessary, 
 in its technical and legal sense, in the meaning affixed to it in common par- 
 lance, established by usage, custom, reason, and the common law of the land, 
 is different and distinct from the signification of the same adjective derived 
 from the substantive necessity, as used by Hobbs, Hutchinson, Hume, andthe 
 other metaphysicians of the last century* It is well known that they used the 
 substantive necessity as synonymous to the word fate: and which necessity, ac- 
 cording to the opinions of one party, controlled omnipotence itself. This neces- 
 sity was supposed by them co-existent with the Deity itself not prospective 
 nor discretionary; bending in one way, and in one way only, all substance, all 
 matter, and all spirit. This meaning of the word is only to be found with these 
 metaphysicians and philosophers: but, in our law books, in the daily and hourly 
 use of the word in common conversation, it has no such meaning. When the 
 old Congress passed the conditional charter, (which I admit they had not a 
 delegated power to grant) but which is fully in point, both as to the signifies 
 
412 BANK OF THE UNITED STATES. 
 
 tion of the word, and also of their opinion of the necessity, and even of tfoe 
 indispensableness of a bank for administering the fiscal concerns of the nation, 
 in the conclusion of the preamble they say, that the exigencies of the United 
 States render it indispensably necessary to pass the act, &c. ; and in the laws 
 passed during that period, when this Government was in the habit of following 
 the English custom of beginning the laws by a preamble, you find the word 
 necessary used as synonymous to expediency, practical expediency, (see laws 
 of the United States, vol. 1, page 247; idem, 276.) In fact, among frail mortals, 
 with fallible judgments like ours with any beings endued with less than om- 
 niscience the word necessary must be only applicable to the honest judgment 
 we can make up concerning the subject to which we apply it; in other words, 
 it is resolvable into that sound discretion with which, as moral agents, we are, 
 in the first instance* entrusted by our Maker, and, in the instance now before 
 us, we are entrusted with by the constitution and by the citizens yvhohave sent 
 us here to transact their business. But the rigid necessity which our oppo- 
 nents wish to enforce on us, this metaphysical necessity, must, from its very 
 nature, be immutable; it must be unique; and could not exist in a greater or 
 less degree; and, therefore, the word joined to it in the constitution, proper* 
 could have no meaning at all. The laws to be passed must be necessary, is 
 the only way given, under heaven, by which you are to effect the end desired; 
 in other words ? the law must be imposed by fate. It is perfect nonsense to 
 say that there is a latitude left with us to judge whether such a law is proper 
 or improper. I have, I think, brought the meaning of the word necessary to 
 the level, and within the comprehension of frail human intellect. The significa- 
 tion of the word proper I take to contain the description of the measure or law 
 to which it is applied in the following respects: whether the law is in conform- 
 ity to the letter, the spirit, and meaning, of the constitution; whether it will 
 produce the good end desired, in the most ready, easy, and convenient mode, 
 that we are acquainted with. Let us apply these definitions to the matter in hand . 
 
 Our opponents have admitted, that banks are necessary to receive and take 
 care of the revenue of the nation. They have, by their statements, shown, 
 that there is little more than one half of the amount of specie in the country 
 which the national revenue rises to, annually; and the burthen of the song is, 
 that State banks will do. 
 
 Banks are then necessary and proper for the collecting, transmitting, and 
 safe keeping of the revenue. Banks are created by law. Congress, by the 
 constitution, have the right of passing laws necessary and proper for the fore- 
 going purposes. Banks are necessary and proper for these purposes; there- 
 lore Congress have the right of passing a law to make a bank or banks. But 
 the power of granting charters and creating corporations is the exercise of the 
 highest act ot sovereignty, say our opponents. I know of no scale by which 
 these acts of sovereignty are graduated; the power of legislation implies sove- 
 reignty; and the description ot a high law and a low law is hardly to be found in 
 any book I have yet met with. I will not dwell on this topic. The arguments 
 of the gentleman from Virginia (Mr. BRENT) on this point, are unanswerable. 
 It is curious to observe the extremes to which some of our statesmen carried 
 their doctrine, twenty years ago, on this subject of charters and corporations; 
 and I have recently met with some who deny that any government has the 
 right to grant them. Our little town corporations, and our city corporation in 
 the State I live in, have had to pass through the legal ordeal to satisfy the 
 doubts of those who entertain this opinion. But now, all the States, undoubt- 
 edly, exercise it, or rather, they have continued to exercise it from their first 
 existence. So have we, in legislating for this territory. If this power is de- 
 rived from the broad terms of the grant to pass laws for this District, in all 
 cases whatsoever; and if the unlimited, unrestricted grant, thus made, is sup- 
 posed to dub us with the higher or quintessential sovereignty, I think it would 
 not be a difficult matter to prove, that this broad grant is, in fact, as much 
 limited and restricted, according to its nature, as the grant of power in the 
 concluding clause of the 8th section which I have before cited. 
 
 Can Congress even pass a law respecting the territory of Columbia, which, 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 according to their opinions, shall not be necessary and proper? The well-being 
 of its citizens or the well-being of the citizens of the whole nation, (for even 
 legislating the territory into non-existence, if we could do so) these would 
 be the motives; in fact, the Legislature must be non compos mentis, who could 
 or would assign, as a general reason, for any of its acts, one opposite to this 
 one of its being; necessary and proper. 
 
 Great stress is laid on that amendment of the constitution, which says that 
 all power, not expressly granted, shall be retained, &c. Either the general 
 clause I have relied on gives power, or it does not; if it did not give po\yer, 
 why was this amendment made? And if it did, and this power was offensive, 
 why was it not stricken out when the amendment was made? But if it ex- 
 pressly gave power, which I contend, its being suffered to remain is proof that 
 it was not the design of the amendment to take away the power given. Gould 
 not the territory of Columbia have been governed without erecting a single 
 corporation in it? I don't mean well-governed? But was there that fatal ne- 
 cessity, that command from Jove, 
 
 " Ye fates fulfil it and ye poweis approve," 
 
 To erect corporations. This legislation to erect corporations being, according 
 to our opponents, sui generis, not of the ordinary kind, and only to be exer- 
 cised where the express authority is given by the constitution, I ask gentlemen 
 to shew the clause in the constitution which expressly gives us the power to 
 perform this sublimated act of legislation in this territory, any more than in 
 any other part of the United States; and yet, at this very session, we have sent 
 an armful of these high acts. The shelves of the office of the Secretary groan 
 under the pile of charters we have grunted. 
 
 I said it was easy to prove that the. broad grant given to Congress to legis- 
 late for this territory, in all cases whatsoever, was restricted and paled in by 
 the constitution. Congress cannot make the duties here on imports less or 
 greater than elsewhere in the United States imports and taxes must be 
 equal, &c. nor deprive the citizens thereof of the right to a trial by jury, 
 nor grant them titles of nobility; and yet the incidents here alluded to would 
 come under the description, in the clause, " of all cases whatsoever." In truth, 
 sir, there is not a scintilla of the spirit, nor a single word or letter of the con- 
 stitution, that loses its power and sanction upon our conduct in legislating in 
 this particular. There is no more a power given us to legislate ad libitum, on 
 this territory, nor to derive therefor, powers by implication, than is given us 
 in the laws we pass for the whole nation; and if this power, sui generis, of 
 creating corporations, is properly defined by our opponents, they ought to o 
 back to the works of yesterday as well as to those of twenty years standing, in 
 order to introduce their new order of things. I might here draw a comparison 
 of the tried scheme of using the United States' Bank, and the untried scheme 
 of using State banks, in aid of the operations of the national treasury; but I 
 should only be saying with less force what has been so fully and so conclu 
 sively said by the gentlemen who have preceded me. Suflice it to say, that, 
 for safe-keeping, for transmission and payment of the funds to any part of the 
 nation, and for enforcing the punctual payment bv the debtors to the customs, 
 by addressing to those debtors the arguments to the sense of honor and shame, 
 and also to their interest, to wit: by denying them credit in the bank, on failure 
 of punctuality all these have been afforded to the Government without its 
 incurring therefor one cent's expense. Are we sure the State banks can or 
 will do this? 
 
 I beg pardon of the Senate for detaining them on topics not new. As this is 
 made a case of conscience, I deemed it necessary to be thus particular. I 
 have no hesitation in saying, we have the right to act on this subject, inasmuch 
 as I think the bank is both necsssary and proper for the purposes above re- 
 ferred to. 
 
 To me it appears that this power is expressly granted we derive it not by 
 implication; but our opponents in fact are pressed to the necessity of using im- 
 plication to come at the denial they set up against the exercise by Congreitj of 
 this power. 
 
414 BANK OF THE UNITED STATES. 
 
 I say, further, that this institution is necessary and proper for carrying into 
 effect another general power, viz. the power to borrow money on the credit 
 of the United States. 
 
 I am one of those, Mr. President, who have always thought a superabundant 
 treasury was no national blessing. It is very easily to be demonstrated that, 
 as to the effect of accumulating national wealth, one dollar in the pockets of 
 our citizens would add twice as much to the common stock as the same sum 
 taken from them and lodged in the strong box of the treasury. None but the 
 nerve of a rigorous and miserly despot, such as was the father of Frederick 
 the Great of Prussia, could ever keep it together after it was collected. 1 
 fear that we republicans are so generous in our natures, that, in some way or 
 other, for some favorite project of a fortification or fortifications, whether by 
 land or water, we should let it go, and think too we were doing the greatest 
 possible good with it. For sudden emergencies, then, I conclude, while our 
 Government lasts, we shall have to anticipate by loans, taking care, as I hope 
 we always shall, and as we have done, to provide for trie early release of the 
 Government from such obligations, which the necessary or sudden emergen- 
 cies are not to be suffered to accumulate. The Bank of the United States 
 serves for effecting both objects quick and reasonable loans. One clause ot 
 the bill compels the bank to loan to the United States the amount of half its 
 capital; and the form ot these loans, as heretofore practised by the Government, 
 is by a mere entry in the bank books, and in the books of the treasury of the 
 United States, of the money borrowed, and the interest stated which is payable 
 thereon; in other words, there is no transferable stock delivered out, and which 
 the Government cannot redeem whenever it pleases- 1 ask gentlemen, if the 
 Government is not bound to provide the means necessary and proper of exer- 
 cising this power of borrowing, and whether there can in any way be devised a 
 more proper mode for the advantage of the nation than the plan proposed; and 
 will not this ready resource, which we shall have for five, six,or seven millions of 
 dollars, serve to keep off the pressure and the combination of individual rapa- 
 city and of individual concert and cabal, with which your efforts to borrow 
 may be met by the large capitalists, and give to the Government time to bor- 
 row even from foreigners, if with them we can make a better bargain for the 
 nation? I know some gentlemen talk largely of the vast sums of money which 
 our citizens have ready to pour into the lap of the Government, if to them it 
 should apply for a loan. The same boasting took place at the time this Go- 
 vernment made its only experiment to borrow money from its citizens. Yes, 
 sir, when there was a mighty rage against France, and the Government was 
 urged into the expensive measures of that day, the experiment was made, and 
 we had to give usury; sir, we had to give an interest of _two per cent, more 
 than the legal interest in the States where the loan was effected. The present 
 crisis is an avyful one. The system of non-importation is now in operation, 
 which hermetically seals the lid of your treasury box to the admission of reve- 
 nue. It is known we shall have to borrow money. And after you put down 
 this bank, where is the loaning capital of the nation to be found? I'll tell you 
 where; it is under the management of the State banks; and those State banks, 
 at least in the largest money holding State in the Union, (Pennsylvania) 
 are precluded from loaning to the United States, unless by consent of the 
 Legislature. Will you go to those gentle and good souls, who give to the dis- 
 tressed the good bargains which the gentleman from Maryland (Gen. .SMITH) 
 told us o!'? Will you apply to the mercy, and kindness, and patriotism, of 
 those ravenous sharks and shavers, who are even considered as acting very 
 moderately when they take from the distressed their one and a half per cent, 
 per month, or eighteen per cent, per year, for the use of their money?.! don't 
 expect much patriotic support from such men as these; they would spurn you 
 with contempt, if you offered them your pitiful and beggarly six per cent. 
 But the State banks are the panacea for all diffiulties; they may lend you the 
 money you want, provided you get the consent of the State which granted 
 their charters. But all the States have not restricted their banks from lend- 
 ing money to the United States. I am contemplating this, not for a day only. 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 4^5 
 
 Do you believe that New York or Maryland, after experiencing the effect 
 which this controlling power of the State, over the money of its citizens, shall 
 have on the General Government, will act so unwisely as to forego the ad- 
 vantage of influence in the Union derived from their dollars and eagles, and 
 act so unjustly to themselves as not to follow the example? Why, sir, not 
 for selfishness sake, but for the sake of fair play, they ought and would do it. 
 The States ought as little to disparage us, in "the exercise of our legitimate 
 functions, as we them; yet, by the operation of these State charters, millions 
 of money are put out of our reach unless by their consent; when, by the con- 
 stitution, we are undeniably permitted to borrow money. Are we come to 
 this, that this meagre and grim demon, this Dr. Snatchaway, who not only 
 denies the powers derived incidentally, (although we have exercised them 
 thousands of times) but before whom withers and perishes the powers ex- 
 prosly granted that this Devil Doctor is even row about to renew to us the 
 distress of the honest Governor described by the inimitable Cervantes? 
 
 I beseech, gentlemen, not to bring on a premature old age in this our Go- 
 vernment: 1 beseech them not to disfranchise the Government of the neces- 
 sary powers for carrying it into effect; and not to throw away the experience 
 and the acquiescence of the nation for twenty years' duration; and I most 
 fervently beg that this power should not be surrendered to thegr^at and lead- 
 ing States, because they have inconsiderately asked for it; that Congress will 
 not, in imitation of the good old Lear, yield to the members of our family 
 what is wholesome and neciaiy for supporting our own household. Soon, 
 very XHHI. the eyes and ears of one or more of the members of our family 
 may be offended at the sight of our committees, our mendicant missions 
 lounging about the lobbies and galleries of the State Legislatures, as some of 
 us have been offended at the presence of the missionaries lounging about our 
 galleries. We, who are now supplicated, will then he BUppltcaforft While v> e 
 succumb to the views or prejudices, or State policy, of each particular State, 
 from whence we implore the permission to borrow, we may succeed; but act 
 independently, run counter to their local feelings, they will not lend you a 
 doit. Think you, sir, that the State of Pennsylvania would have consented 
 to your making a loan from its banks at the period at which General Bright 
 was in battle array against your authority? Think you that Massachusetts 
 would have treated your beggars kindly during the embargo ferment? Would 
 the gentleman from Maryland, with his high standing in that State, the turn 
 of whose politics* he says, may depend upon the continuing of this bank 
 could he, sir, with all his commercial knowledge and the eloquence he dis- 
 plays, have obtained the giant of a favor to the Government of the United 
 States about two years ago? Ah! no. sir. When civil broils, when political 
 intolerance and party rage, shall pervade a Legislature, they will act as other 
 men; and if excited only to the height to which the newspapers seem anxious 
 to excite them on the present, occasion, there might be rashness enough found 
 to induce them to ur?e your messenger as was used the good old Kent, when 
 supplicating in the cause of his houseless master. The gentleman from Vir- 
 ginia (Mr. GILES) has called the attention of the Senate to the 9th article of 
 the amendments of the constitution, viz. "* the enumeration in the constitution 
 of certain rights shall not be construed to deny or disparage others retained 
 by the People." Now Congress have the power to borrow money; and from 
 plain and necessary implication, though not by express delegation, (such as is 
 required by gentlemen in the instance before us) we have the power to fix the 
 rate of interest to be given; yet the State Legislatures have the power of fixing 
 the rate of interest which their citizens lending money shall receive, and have 
 fixed and established that rate, and enforced the provisions on this subject by 
 severe penalties. I know not how Mr. Adams found the States so much 
 asleep to their rights when he tempted their citizens to become usurers, and 
 this, too, in denial and disparagement of State powers actually exercised. If 
 the present vigilance had then been exerted,! should suppose he was very 
 lucky that he was not as much harassed as were some of the victims under 
 his sedition law. Carry this doctrine of rigid construction, in respect to this 
 
416 BANK OF THE UNITED STATES, 
 
 instance ot collision of State and United States' authorities, to the extent con- 
 tended for by the opposers of the bill; enforce, to the fullest extent, according 
 to its obvious meaning, the amendment last quoted; and we shall be surround- 
 ed with powers which we dare not use. We may borrow; but the citizens 
 will not lend tor the legal interest established by law. The States prohibit 
 them lending at an usurer's interest, and impose heavy penalties if they do; 
 or, to embarrass the General Government, the States, or some of them, hold- 
 ing the moneyed capital, may prohibit individuals, as they have prohibited the 
 banks, from lending to us; and thus benumb all our energies. In fact, sir, 
 the doctrines and notions I have heard enforced here, seem calculated to 
 place us in the situation of the miserable Tantalus; the limpid and whole- 
 some stream is within our reach, but we dare not reach out our hands to take 
 up a drop to cool our tongues, destined to the sufferance of eternal thirst. 
 Let me now inquire how the destruction of this bank is to operate on the na- 
 tion at large. By the minute detail of the honorable Senator from Maryland, 
 (General SMITH) ot the mode and manner, and by what commercial opera- 
 tions, the foreign capital in this bank is to find its way out of the country, I 
 take it to be one of nis motives for putting down this bank, that the foreign 
 capital should be drawn out of the country. Indeed, if this were not his 
 object, I cannot see why his heaviest artillery was brought to bear upon the 
 foreign influence, which he alleges this foreign capital brings into the country; 
 and yet neither he, nor any one who has cried aloud against this sin, has pro- 
 duced a single instance of a foreign stockholder having exerted his influence 
 against the Government of this country. [Barings book, on American af- 
 fairs, might be adduced as an instance of the opposite effect produced.! 
 
 The farthest that the assertions go, is, that our own citizens, federal bank 
 directors, may have exerted their influence; and they and their money, which 
 is not. proposed to be annihilated by this bill, may, and probably will, be 
 brought to bear against us again and again; and the only remedy I see would 
 be to kill them and take their money. This would effectually destroy their 
 influence. To return, sir, to the grand object of drawing out seven millions 
 and upwards of foreign capital from this country. I know that some have 
 asserted, with great confidence, that the section of the Union, north and east 
 of this, is saturated with a moneyed capital, domesticated, sufficient for all 
 the purposes of its citizens. 1 cannot prove that this is incorrect, but, from 
 the anxiety shown by those People, (on the subject now before us) by the 
 moderate 18 per cent, loans we have heard of, I should remain a perfect 
 Thomas as to the correctness of this assertion. Let me speak of those States 
 concerning which I am better informed: I begin with Virginia, because it is 
 nearest. This State is indented with the finest bays and rivers in the world, 
 her shores are bold, and her waters deep, affording ports and harbors in more 
 abundance than are to be found in any State of the Union; look at the weight 
 of tonnage employed in carrying to the old world the immense proceeds of 
 this productive country; their citizens equal in intellect and enterprise to any 
 in the world. What is the reason that they pay a transit duty, annually, to 
 New York, Philadelphia, and Baltimore, to more than double the amount of 
 their State bank stock, in profits to the shipping merchants in these cities, in 
 freights coastwise of the produce, and in the freight, also coastwise, of Euro- 
 pean supplies? Does this evidence no want of commercial moneyed capital 
 within the reach of the citizens? Travel through it, compare it with the 
 Northern States; at every step you see apparent the disadvantages it labors 
 .jiuder in this respect. Why. sir, the circumstance of the basin at Richmond, 
 with a fall of nearly one hundred feet, remaining for ten years a stagnant pool 
 within the heart of her capital city, when, with this power, more machinery 
 than is to be found in half the manufacturing towns of England might be pro- 
 pelled tells the secret. 
 
 It is a well known fact, that the trade of North Carolina, with the excep- 
 tion of a few vessels with naval stores and lumber, makes its humble attorn- 
 ment to the city of New York. South Carolina and Georgia have a small 
 portion of their commerce direct with Europe; but the thousands of bags of 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 cotton shipped from the ports of Philadelphia, New York, and Boston, the 
 circumstance of there being eleven packets constantly trading to New Y9rk, 
 alone, from Savannah, and as many, or more, from Charleston, show plainly 
 that this transit duty is paid by us also. The French emperor knows this as 
 well as we do ourselves, and his provision for admitting cotton from New 
 York is not because he did not know the article did not grow there, but be- 
 cause he knew the capital there acted like a loadstone, and drew the article 
 from the States in which it grew. I do not mention these things invidiously; 
 I wish prosperity to these cities as well as to the whole Union; but protract 
 not the growth of other parts of the United States, by driving out the means 
 from the country by which they have grown, and which, if let alone, might 
 be extended to us also. No man who has attentively considered the rise, pro- 
 gress, and growth of these States, from their first colonization to the present 
 period, can deny that foreign capital, ay, British capital, has been the pap 
 on which we first fed; the strong aliment which supported and stimulated our 
 exertions and industry, even to the present day; the Southern People, although 
 they have received the goods, and sold their crops to British agents and Bri- 
 tish factors, whether in their own cities or those further North, are not the 
 less republican, nor the less independent in their politics, nor the less free 
 from foreign partialities. I will here mention a fact, which I happen to re- 
 member, which, among ten thousand other instances, might be mentioned, of 
 the benefit derived to the country by the use of this detested foreign capital. 
 In the progress of the digging of the Santee canal, the greatest work of the 
 kind in America, the expense so far exceeded the calculations of the com- 
 pany who had undertaken it, that many of the stockholders, like all sanguine 
 calculators, were straightened in paying up their instalments as they became 
 due; these obtained accommodation at the bank: but, even then, it was found 
 difficult to progress, and at length the company actually borrowed of the 
 branch bank the funds to complete it; and, unless it has been very lately paid, 
 the company still owes a very considerable sum to the Bank of the United 
 States; and, but for this accommodation, it is more than probable that this 
 great work, which is capable of facilitating, to a most convenient degree, the 
 transportation of the products of nearly naif the State of South Carolina, 
 might never have been accomplished. We have heard much of parties ana 
 party spirit in this discussion. I'll tell you, sir, who will compose the parties 
 in the immediate concussion about to be be produced by the downfal of this 
 bank the withdrawal ot fifteen millions of circulating medium, cither in actual 
 paper bills, or in bank credits, answering the full purpose of circulating me- 
 dium, while the merchants are under distress from foreign aggression, and 
 while the Government has commenced its restrictive system on mercantile 
 operations; while it will make the money more scarce, will make it more 
 dear, and of course will make property more cheap; produce will fall; it has 
 fallen in consequence of the anticipations on this subject the small trader, 
 and the young industrious and enterprising mechanic and manufacturer, whose 
 stock (and it is the best stock in the world) is his honesty and fair reputation, 
 and on which the banks have advanced him money, must pay off at any and 
 every loss, or perhaps buy his money at the moderate premium of one and a 
 half, two, or three per cent, a month. These men, such as the worthy sup- 
 pliants from Philadelphia represent, will be delivered over to be devoured by 
 the sharks and shavers, who are now prowling for their prey, among the dis- 
 tresses and calamities you are about to inflict on that class of citizens, the 
 most worthy the care of a wise government. The parties are the rich-cash- 
 in-hand men on the one side, and the great agricultural and manufacturing in- 
 terest, and the small traders on the other. If I had only heard and not seen 
 the gentleman from Tennessee, (Mr. ANDERSON) when delivering his oration 
 in praise of republican simplicity, I should have thought we had another 
 Diogenes preaching from his tub; but there needs no oratory to convince the 
 mission in your gallery, and their friends behind them, that, after the big fish 
 have eaten the little ones, they will neither have motives or means for depart- 
 ing from the chaste frugality and republican simplicity of manners, recom- 
 53 
 
418 BANK OF THE UNITED STATES. 
 
 mended by the words of the gentleman; it will be only those who have fat- 
 tened upon the spoil who can indulge in the simple style and plain and humble 
 habiliments of our modern Diogenes. 
 
 I have said I rejoice in the prosperity of every part of our Union. But,, 
 either the gentleman or I have proceeded together upon very mistaken 
 grounds. I thought the seizing of West Florida was, among other objects, to 
 answer the purpose of giving an outlet for the products of Tennessee and the 
 other Western States; 1 thought, too, the purchase of Louisiana, at fifteen mil- 
 lions, to be paid by the whole nation, was for this object also; and I cannot 
 suppose that the effecting of this object would tend to make the People poor* 
 or preserve among them this reoublicn simplicity of manners; on the contrary,. 
 I do hope and expect, that it will tend to promote the industry and enterprise 
 of the citizens, and develop the vast resources of wealth, profit, and strength, 
 of our Western brethren. Perhaps the resolution on our tables for imposing 
 additional duties on hemp and hempen manufactures is also designed to pro- 
 mote the wise project of keeping our Western brethren from growing too 
 rich, and thereby preserving our republican simplicity. 
 
 I have not yet done treating this as a party subject. 1 did not, it is true, 
 come here to legislate for a party, or for any particular administration; but 
 where I. think a measure is subversive of the interest of the nation, and sub- 
 versive of the party to which I am attached, it is not unfair to take this lat- 
 ter aspect into view also. Let it be recollected that the present administra- 
 tion have not a single leading (for they arrogate the term as well as the States) 
 paper, republican or federal, in the nation, except the paper edited here, 
 (which is mild in its tone, and not, as yet, disposed to rush into the fire to de- 
 fend the powers that be) I say let it be recollected that there is none of 
 these irresponsible dictators to public opinion, who lift a quill in our cause. 
 The constant theme is the baseness and tergiversation of the tenth and 
 eleventh Congress, and the wickedness and corruption of the servants of the 
 public, and ever and anon their lash reaches beyond our shoulders, and strikes 
 the Executive also. But k more is coming yet from them; they have shown 
 iheir teeth. It is true we may follow those calling themselves republican in 
 the vote which we are now about to give. But, do you think, for this act, 
 that they will come back to your aid that they will take us for better for 
 worse? No, sir; when the evils which will be produced by the rejection of 
 this bill; when private distress and public embarrassment shall raise the out- 
 cry; they will ride on the winds, and direct the storm, and will be the first to 
 cry out there is no energy in us, and to join any intrigue to hurl us from our 
 seats. It is easily to be demonstrated that, by the details of the bill on your 
 table, if its friends were suffered to perfect it, it would produce, say in the 
 bonus., one and a fourth millions at least, perhaps two millions of dollars; 
 premium on the five millions of stock to be created two and a half millions; 
 in the whole, at the lowest calculation, three and three-fourths millions of dol- 
 lars, which will be given up, lost ,and abandoned, by us. Will gentlemen re- 
 collect that only halt of this sum, taken from the People by the direct tax, hur- 
 ried Mr. Adams and his friends to their political death? And the People are 
 not such fools as not to see that what is taken away from the treasury is 
 taken from their pockets; you may disguise it as you will, by procrastinating 
 loans, it will not escape their detection. 
 
 And for whom is this mighty sacrifice to be made? If the ministering to the 
 treasury of the United States is worth to the Bank of the United States so 
 much that it will accept the terms abovementioned, and you resolve to em- 
 ploy others to do the same thing, in this office, worth so much to the Bank of 
 the* United States, \yorth less to them ? This is the lever. Here the real par- 
 ties are apparent. The nation the great agricultural interest, the solid yeo- 
 manry of the country, on one side; and the city influence, the London and 
 Paris influence, on the other. The advantage palpable of nearly four millions 
 of dollars, wrested from the Government, and of course from the People, and 
 sent to whom? To the great capitalists, monopolists of State banks, to the 
 Leaden Hall Street gentry, whose insatiate maws could not be glutted by the 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 4J9 
 
 plundering of an empire. Do you believe, sin, that the great body of the 
 pie, who are actuated by the impulse of feeling, and who may not indulge in 
 the nice distinctions we have drawn here about the constitution, but who have 
 experienced the convenience of a circulating medium, current over the whole 
 extent of the Union, and who have witnessed your numberless acquiescences 
 to the legality of this institution, and read your laws for punishing those evad- 
 ing its rights, and your numerous laws for trusting, trading, borrowing, and 
 receiving favors from this bank will this your recent discovery of its uncon- 
 stitutionally be an excuse for giving away twenty per cent, on all their produce, 
 and for the giving away double the amount of that tax, for the imposing of which 
 they condemned your predecessors ? I fear for the safety of the constitution 
 itself. It has been denounced by those who have denounced us. The feeling 
 is quickly transferred from the ministers under the constitution to the consti- 
 tution itself. The clamor has gone forth that we want energy; that the con- 
 stitution wrnts energy; and avast remedy has already been proposed by the 
 Aurora itself: to give Congress the power to lay an export duty upon the pro- 
 ductions of the country more of your London and Paris influence; to lay 
 the agricltural interest under the ban of the empire. Consolidation is the 
 watchword. Preserve your constitution without abandoning its legitimate 
 powers, such as you have prospered in the exercise of, and I fear not this hob- 
 goblin; but weaken it, place it to lean upon or revolve round any local State 
 policy, and to obey the beck and call of any one or of ail the leading States, 
 and the rights and interests of the State 1 represent, and all the other smaller 
 States in the Union, could not be very much affected by; any change. 
 
 It is acknowledged on all hands that there is not specie enough in the na- 
 tion, if applied solely to that purpose, to pay our annual impost. The opera- 
 tions of the Bank of Columbia in transferring the revenue derived from a part 
 of Virginia (and of the land funds from the westward) and of the Manhattan 
 Bank, in performing the same office in respect to the collections in Connecti- 
 cut, have beien dwelt upon by the honorable Senator from Maryland, (Gen. 
 SMITH.) His arguments, drawn from the facts would have been more ccmclu- 
 sive, if he could have instanced the same facilities afforded to the Govern- 
 ment between banks disconnected by the effect of that neighborhood circula- 
 tion and of that course of trade very apparent in the instances he has produced. 
 But it is not conclusive at any rate. There is a neighborhood medium of cir- 
 culation (the State bank paper) and there is a national medium (the United 
 States' paper.) The latter, under the present state of things, corrects the 
 operations of distant banks, and renders their transfers easy; but, deprived of 
 this, would any of them, situated at four or five hundred miles, or at 1000 
 miles distance, agree to make these transfers for the Government free of ex- 
 pense? Could thev, for instance, transfer the solid bullion, belonging to the 
 U. States, from Orleans, to Boston or Philadelphia, without our affording com- 
 pensation for freight, insurance, &c. I have witnessed the advantages of this 
 national medium in the State 1 live in; and in the months of autumn, when 
 strangers are fearful of venturing to Charleston, our Western friends, rather 
 than carry the hard dollars, are in the habit of giving two or three per cent. 
 for bills of the Bank of the United States. Destroy this national medium, you 
 insulate the State banks, which are so far asunder as not to be within the in- 
 fluence of the neighborhood medium of circulation. The stroke of our dread- 
 ful wand disconnects the ligament by which they are bound together in their 
 distant operations. 
 
 Gentlemen tell us we must use the State banks, and of consequence the 
 State bank notes. Some of these notes happen to be worth nothing; Glouces- 
 ter bank notes for instance; and they are graduated in different parts of the con- 
 tinent, from par, down to twenty or twenty -five per cent, below par, and the 
 market value is, in some instances, perpetually changing; our treasurer must, 
 if he can, separate the sheep from the goats; and this is to be perpetual labor. 
 Even good notes, at par, when received, may be useless to the public credi- 
 tor, who is to receive them. ' A Portland bill, for instance, would not get me 
 a meal's victuals from this, home; and an Augusta, or Savannah, or New Or- 
 
420 BANK OF THE UNITED STATES. 
 
 leans bank bill, would not have its value understood in New England. In- 
 deed, Mr. President, this chaos, this confusion, about to be introduced in 
 our treasury, and the legitimate exercise of our constitutional powers as a 
 government, is likely, too likely, again to exhibit to the world the distraction T 
 and, perhaps, dispersion, (which God forbid) which the seed of Noah expe- 
 rienced at the Tower of Babel- 
 
 I have given, candidly, my honest views of the subject before us, meaning 
 no uncharitableness to those honorable gentlemen in the Senate who differ 
 with me, and, infinitely rather would 1, that, after the trial, and after long 
 experience to come, all that I have said should be discovered to be founded 
 in error the effect of a heated imagination than that my country should suf- 
 fer a single pang, though in fulfilment of the things I have this day uttered. 
 
 FEBRUARY 20, 1811, 
 Motion to strike out the first section of the bilL 
 
 Mr- PICKERING. Mr. President: Having received, from the House of Re- 
 presentatives of Massachusetts, an instruction, in the form of a request, " to 
 oppose the renewal of the charter of the Bank of the United States,." and 
 some other members of the Senate having received, from their respective 
 States, instructions to the same effect, I will make a few observations on the 
 subject of instructions.. 
 
 I was pleased to hear the gentleman from Virginia, over against me, (Mr. 
 GILES) after reading his instructions from that State, express his opinion de- 
 cisively, that instructions from constituents were not binding on their legisla- 
 tive Representatives. Concurring entirely in this opinion, 1 will offer some 
 reasons, to show that they are erroneous in principle, that they infringe the 
 rightful independence of Representatives, and, in respect to members of Con- 
 gress, that t)iey violate the constitution of the United States. 
 
 In a small community r where all its members can meet together and consult 
 on the measures necessary and proper to promote their common interests, 
 their decisions are the result of deliberation, of reasoning, and of the inter- 
 change of sentiments. When the members become too numerous, or are too 
 widely extended to admit of their personal attendance in a general assembly, 
 it seems to be a very natural provision to select a convenient number of then* 
 to meet together to manage their common concerns,, in the same manner they 
 were before conducted by the whole community. And thus, from the very 
 nature of this institution, it becomes the duty of the persons composing the 
 representative body, to consult, deliberate, and mutually communicate their 
 reasons and opinions, and. thereupon, finally to decide on the measures re- 
 quisite to be adopted for the welfare of the community. Hence, it follows, 
 mat all peremptory instructions, or naked requests, designed to control or in- 
 fluence the votes of the Representatives, are subversive of the fundamental 
 principle of a representative government. 
 
 Such instructions, or requests, addressed to members of Congress, do, also,, 
 violate the constitution of the United States* The first sentence in that con- 
 stitution is in these words: " All legislative powers, herein granted, shall be 
 vested i a Congress of the United States, which shall consist of a Senate and 
 House of Representatives." Now, therefore, if State Legislatures undertake 
 to dictate, by their instructions, or by requests which are intended to operate 
 equally with instructions, what votes shall be given on any question, by their 
 Representatives in Congress, they so far assume the powers vested, by the 
 constitution, exclusively in Congress. And if their instructions, or requests, 
 are obeyed, then the State Legislatures, and not Congress, enact laws for the 
 
 If, indeed, a State Legislature should, in the form of instructions or 
 requests, enter into a train of reasoning, and present arguments which should 
 convince my understanding that any measure under consideration in Con- 
 gress, was, or was not, consistent with the constitution, and exhibit facts 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 which proved its utility, or injurious effects, then I should yield obedience 
 accordingly; but to what? To instructions or requests? No: but to REASON 
 and to TRUTH. 
 
 In another respect, such instructions and requests violate the constitution, 
 in regard to the members of this body. Senators are chosen for six years. 
 This was intended, by the framers of the constitution, to give them that inde- 
 pendence which should secure freedom in thinking and acting. But, if Senators 
 were bound to obey the instructions of their respective State Legislatures, 
 that independence would be wholly destroyed. Indeed, it would put Senators 
 as absolutely in the power of their constituents, as if the State Legislatures 
 had the right to recall and dismiss them at pleasure. 
 
 I will now, Mr. President, make some observations on the main question 
 under consideration whether Congress have the power, by the constitution, 
 to renew the charter of the Bank of the United States. 
 
 It has been said that the power to incorporate a bank for the United States, 
 is a substantive and original, and not a derivate or implied power. This has 
 been repeated; but I have heard no arguments in support of the position; it 
 is a naked assertion. 
 
 It has, also, been called " an act of sovereignty;" as if to alarm and deter us 
 by its awful magnitude. But, sir, the sovereign power of Congress is sometimes 
 exercised on subjects of comparatively little moment. A tew days since we 
 passed a bill to authorize the erection of a bridge; and another to change the 
 name of an individual, to enable him to inherit an estate. The power of 
 Congress is sovereign to all the purposes of the constitution/ They can lay 
 and collect taxes, duties, imposts, and excises; borrow money; regulate com- 
 merce; and make all needful rules and regulations respecting the territory 
 and other property of the United States. And they have power to make all 
 laws necessary and proper to cany the foregoing, and all other constitutional 
 powers, into execution. When proposing to exercise this general power, in 
 any case not expressly mentioned, we have to consider whether it be k4 ne- 
 cessary and proper." It has been said that " necessary" here means indis- 
 pensable; something without which a particular power, expressly granted, 
 cannot be carried into execution. But, sir, I see no ground for this interpre- 
 tation. In the affairs of a nation or other community, whatever the public 
 good requires to be done* is necessary and proper to be done. It is a moral, 
 not an absolute necessity. It is necessary for me to be here, in my place, 
 because it is my duty to be here. Necessary and proper are opposed to unne- 
 cessary and improper. Congress should do no act unnecessary and improper; 
 but, like State Legislatures, do whatever is necessary and proper to attain the 
 objects for which they are respectively constituted. 
 
 In determining whether any proposed measure be necessary and proper to 
 carry into execution any power expressly given to Congress, we have to 
 consider whether that measure has a just or useful relation to the end. For 
 instance, the constitution having prescribed no mode of collecting the revenues, 
 it rested in the decision of Congress to adopt such a mode or such modes as 
 should appear to them best adapted to that object. Instead of appointing 
 custom house officers in the large commercial cities and towns, where a bank- 
 ing establishment could be supported, Congress might there have erected 
 banks the most certain, punctual, and cheap mode of collection. Suitable 
 officers of a bank might have performed all the duties of entering and clearing 
 vessels, and all other duties pertaining to the custom house, without any charge 
 to the public: the deposites of the public moneys, so collected in those banks, 
 upon which the usual banking operations might be carried on, yielding an 
 adequate compensation for all the services so performed. 
 
 The public revenues, when collected, must also be safely kept. And expe- 
 rience has demonstrated, that, of all depositories, banks are the safest. And 
 the same experience has shown, that, as the public moneys are required to be 
 frequently transferred, for the public expenditures, from one State to another, 
 the Bank of the United States, with its branches, has furnished the best mode 
 
422 BANK OF THE UNITED STATES. 
 
 of transfer; it being effected with despatch, with certainty, and without any 
 risk or expense to the United States. 
 
 The gentleman from Kentucky (Mr. CLAY) asked, if banks are necessary 
 for collecting the public revenues, why give them any other power? The 
 answer is, that it is the essential nature of banks which renders tnem so pecu- 
 liarly fit to collect the revenues. The merchants, whose bonds are lodged in 
 the banks for collection, are also borrowers of money from the banks; and if 
 they fail of paying their bonds as they become due, their credit will fail; they 
 can obtain no more loans until their bonds are paid. This has been pre- 
 sented to our view, in the most striking manner, by my colleague. 
 
 "To borrow money," is another of the great powers expressly vested in 
 Congress. And in this, as in the power first considered, no mode of borrowing 
 being prescribed in the constitution, Congress are to devise and provide the 
 means in their judgment most sure, expeditious, and ample, to obtain loans. 
 And this was one of the great objects for which the Bank of the United States 
 was originally incorporated. The gentleman from Virginia, near me, (Mr. 
 BRENT) and the gentleman from South Carolina, (Mr. TAYLOR) have, in 
 very forcible language, displayed the impolicy of depending on State banks, 
 or individuals, for loans, in public emergencies. At such times, these banks 
 and individuals may be most hardly pressed by their usual customers. To 
 suffer the Bank of the United States to dissolve, and to have recourse to State 
 banks, will be so far going back to the condition of the United States under 
 the articles of confederation; when our Union was but a rope of sand. When 
 the pressure of the Revolutionary war was over, indeed, while that pressure 
 remained, Congress in vain made requisitions on the individual States; no 
 money, or none in any measure adequate to the public exigencies, could be 
 obtained. After the war, when the public treasury was empty, Congress 
 importuned, implored the States, individually, to grant the power to raise a 
 revenue from commerce, to defray the current expenses of the General 
 Government, and to fulfil the public obligations; but the power could not be 
 obtained. States, deriving large revenues from commerce, chose to retain 
 them for their own treasuries. 
 
 It was this helpless, forlorn condition of our country, which forcibly con 
 vinced the nation of the necessity of forming a new system of Government; 
 and our present Government was the fruit of that necessity. 
 
 " To regulate commerce," is a third great power vested m Congress. And 
 it is conceived, that the exercise of any power well adapted to give safety, 
 facility, and prosperity, to commerce, must be comprised in the power to regu - 
 late it. Hence the erecting of light houses has been mentioned as an instance 
 in which an implied power, incidental to the regulating of commerce, has been 
 exercised. But it has been said, that this power is expressly given, in another 
 part of the constitution; th it by which Congress is vested with exclusive 
 legislation over the district which is the seat of Government, and over places 
 ceded to the United States, " for the erection of forts, magazines, arsenals, 
 dockyards, and other needful buildings." But if .we had no commerce, no 
 navigation, light houses would not be "needful buildings;" they would be of 
 no use whatever. Hence, it is clear, that they have a direct relation to com- 
 merce, and to nothing else; and, therefore, the erecting of them is properly 
 adduced as an instance of the exercise of a power implied in the general 
 express power to regulate commerce. 
 
 The safety and facility of commercial operations, was also greatly to be 
 promoted, by means of a general currency, which should have equal credit 
 throughout the Union. This has been accomplished by the notes issued from 
 the Bank of the United States, under the authority of Congress, exercising 
 the power incidental to that of regulating commerce. 
 
 A fourth great power which I mentioned to have been vested in Congress, 
 is that of " making all needful rules and regulations respecting the territory 
 and other property of the United States." This "other property" consists 
 partly of money. And, as Congress have power to make any regulations con- 
 cerning it which are needful, that is, whicn may, in their opinion, best pro- 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 423 
 
 mote the general welfare; this money may be (as some of it has been) vested 
 in bank stock; and, with the truest regard to its safety and good management, 
 in the stock of a bank erected by Congress, of which they may have a suitable 
 inspection; and where it may safely deposite the public revenues, there to 
 await the public demand; and, in the mean time, usefully aid those banking 
 operations which give facility to commerce and to public loans. 
 
 But, as an evidence that the constitutionality of the act to incorporate the 
 Bank of the United States was at least doubtful, we have been told by the 
 gentleman from Maryland, (Mr. SMITH) that President Washington doubted; 
 that his mind was in suspense to the last moment, when the act was to be ap- 
 proved or disapproved. That, while the then Secretary of the Treasury, 
 (Mr. Hamilton) a very great man, maintained the constitutional power of 
 Congress to erect that bank, another man, (Mr. Jefferson) equally great, then 
 Secretary of State, and the Attorney General, (Mr. Randolph) a distinguish- 
 ed lawyer, maintained the contrary doctrine, that Congress had not that pow- 
 er. It is true, sir, that Washington, cautious and circumspect beyond any 
 man I ever knew, did suspend Tiis decision to the last day allowed him by 
 the constitution. The confidence with which the Secretary of State and At- 
 torney General supported their opinions on this Question, was sufficient to 
 excite in the President the greatest caution. Both were lawyers, and they 
 raised many legal objections" The written opinions of these gentlemen were 
 (as I have been well informed) put into the hands of the Secretary of the 
 Treasury, two days before it was necessary for the President to decide. And 
 the reasoning of Mr. Hamilton, in his written argument, enabled the Presi- 
 dent to decide with satisfaction, with a full conviction of the constitutionality 
 of Ihe act. 
 
 The folle wing are some of the objections offered by the Secretary of State: 
 He said " that the proposed incorporation (of the bank) undertakes to create 
 certain capacities, properties, or attributes, which are against the laws of 
 alienage, descents, escheat and forfeiture, distribution and monopoly. And 
 that nothing but a necessity, invincible by other means, can justify such a 
 prostration of laws, which constitute the pillars of our whole system of juris- 
 prudence, and are the foundation laws of the State Governments. " Wash- 
 ington, sir, was not a lawyer. And who can wonder that his fair mind was 
 alarmed by such a solemn declaration? That it was kept in suspense by the 
 assertion, that the act for establishing the bank would overturn the pillars of 
 our whole system of jurisprudence, and the foundation laws of the State Go- 
 vernments? But, sir, it required only the knowledge of a lawyer, at once to 
 overturn these objections. The following are some of the remarks of the 
 Secretary of the Treasury: " If (says he) these are truly the foundation laws of 
 the several States, then have most of them subverted their own foundations. 
 For there is scarcely one of them which has not, since the establishment of 
 its particular constitution, made material alterations in some of those branch- 
 es of its jurisprudence, especially the law of descents. But it is not con- 
 ceived how any thing can be called the fundamental law of a State Govern- 
 ment, which is not established in its constitution, unalterable by its ordinary 
 Legislature. 
 
 14 To erect a corporation, is to substitute a legal or artificial for a natural 
 person; and, where a number are concerned, to give them individuality. To 
 that legal or artf/zem/ person, once created, the common law of every State, 
 of itself annexes all those incidents and attributes which are represented as a 
 prostration of the main pillars of their jurisprudence. It is certainly not ac- 
 curate to say, that the erection of a corporation is against those different heads 
 of the State laws; because it is rather to create a kind of person, or entity, 
 to which they; are inapplicable, and to which the general rule of those laws 
 assigns a different regimen. The laws of alienage cannot apply to an artifi- 
 cial person, because it can have no country. Those of descent cannot apply 
 to it, because it can have no heirs. Those of escheat are foreign from it, for 
 the same reason. Those of forfeiture, because it cannot commit a crime. 
 Those of distribution, because, though it may be dissolved, it cannot die," 
 
424 BANK OF THE UNITED STATES. 
 
 Sir, I beg leave to add a few explanations. By the laws of most, perhaps of 
 all the States, aliens are not permitted to hold real estate; but, in all, they 
 are free to hold personal property of every kind, and particularly bank stock. 
 The law of escheat relates to the property of a citizen who dies without heirs, 
 near or remote, and without a will. In such case, his property falls to the 
 State. But instances of escheat do not occur perhaps twice in a century, in 
 any State; and consequently, is of trifling moment. Although a corporation 
 cannot commit a crime, it may violate the rules prescribed in the law for its 
 establishment; and thus incur an immediate forfeiture of its charter. Or, if, 
 for such a violation of its fundamental law, or any mismanagement of the in- 
 stitution to the public injury, its charter be not forthwith taken away, the 
 State may refuse to renew it. As to the law of distribution, that operates 
 when a person dies intestate. But, though a corporation cannot die, yet the 
 individuals to whom its property belongs, will die; and their bank property, 
 equally with their other property, becomes liable to the law of distribution. 
 
 One gentleman has imagined, that, if Congress have, and exercise the pow- 
 er of erecting corporations, it will operate as a monopoly; and may, in the 
 end, destroy all the powers belonging to the individual States. But there is 
 here no ground for alarm. The act of Congress which established the Bank 
 of the United States, did not, and could not affect the rights of the States to 
 erect banks. Accordingly, we have seen, after the Bank of the United States 
 had been erected, and the profitable operations of banks to their proprietors 
 were known, that State banks sprang up in abundance. 
 
 It has been said, by more than one gentleman, that the greater portion (as 
 far at least as seven-tenths of the whole) of the stock of the United States' 
 Bank being owned by foreigners, and these chiefly Englishmen, there is dan- 
 ger of a foreign influence in the country, and that such an influence has been 
 manifest. This, sir, appears to be an extraordinary remark. In what has 
 this influence been manifested? Has the Government, have individuals, been 
 in any degree restrained in the expression of their resentments against Great 
 Britain? Or, in adopting any measure deemed advisable towards that country? 
 
 One of the injurious consequences of destroying the Bank of the United 
 States, has been stated to be, the withdrawing of seven millions of dollars 
 from the active capital of the United States, and transmitting it to Europe, 
 where that portion of the bank stock is owned. To this, it has been answered 
 by the opposers of the bank, that these millions will not be withdrawn, but 
 transferred from the United States' Bank, to banks of the several States. 
 How, then, sir, shall we get rid of that dangerous influence of foreign stock- 
 holders, which the same gentlemen urge as a reason for not renewing the char- 
 ter of the Bank of the United States? Sir, it is well known, that money in 
 Europe is less valuable than in the United States; that moneyed men there, 
 are glad to loan their money at an interest of five per cent., or less; while in 
 these States, the legal interest is six per cent. And a multitude of our citi- 
 zens find their account in employing that foreign capital, paying an interest of 
 six per cent., by which, in the course of trade, they gain ten, fifteen, or twen- 
 ty per cent.; that foreign capital, in the hands of our merchants, has resem- 
 bled the five and the ten talents, wherewith they have gained other five and 
 other ten talents. 
 
 The distresses which will follow the dissolution of the Bank of the United 
 States, especially in the great commercial cities, have been forcibly described 
 h the plain testimonies of the committee of mechanics and manufacturers 
 horn Philadelphia a committee selected wholly from the democratic party; 
 distresses which were sufficient to move a heart of stone. And why should 
 this bank be dissolved? It has been said that the State banks are competent 
 to all the necessary operations of the general bank. If the contrary had not 
 been shown, it might be answered, that the Bank of the United States was 
 incorporated when there were only three banks in the United States* one in 
 Philadelphia, one in New York, and one in Boston. These were inadequate 
 to the necessities and accommodation of the General Government, and of the 
 citizens. To supply this deficiency, it was necessary to erect the national 
 
'ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 bank: and the dignity, honor, good faith, and credit of the United States, 
 stand pledged for the renewal of its charter. The institution haying been 
 well conducted, and found in the highest degree useful and beneficial to Go- 
 vernment, and to the citizens at large, it ought to be continued. Individual 
 citizens and foreigners became stockholders, on a well grounded expectation 
 of the stability of the Government, It was in this just expectation that fo- 
 reigners. Englishmen, purchased of our Government itself, its remaining 
 shares of the public stock in the Bank of the United States, and at an ad- 
 vance of forty-five per cent, so that for every hundred dollars laid out by the 
 Government in the purchase of bank shares, the United States received of 
 these foreigners one hundred and forty-five dollars. And ho\y was it possible 
 for these foreigners to conceive the Government capable of destroying the 
 work of its own hands, and of reducing their property to one hundred dollars 
 a share, for which, but eight years before, they had paid the same Government 
 one hundred and forty-five dollars? 
 
 In limiting the duration of the charters of banks to twenty years, no 
 wise Government ever contemplated their destruction at the end of that term. 
 Known to be useful institutions, the proprietors have well founded claims to 
 their continuance; which the public good also requires. But, in the course of 
 twenty years some inconveniences may be experienced, which ought to be re- 
 medied, and some improvements discovered which ought to be adopted. Be- 
 sides, being profitable to the proprietors, they can well afford, once in 20 years, 
 to give to the Government considerable sums of money in acknowledgment for 
 the benefits derived Iron the acts of incorporation. 
 
 But, sir, in respect to the English stockholders in the Bank of the United 
 States (and the foreign stockholders are chiefly Englishmen} we are under 
 special obligation^ by the treaty with Great Britain, in 4 1794. 'Ihe tenth article 
 being permanent, is still in force, and in these words: 
 
 ' Neither the debts due from individuals of the one nation to individuals of 
 the other, nor shares, nor moneys which they may have in the public funds, 
 or in public or private banks, shall ever, in any event of war or national dif- 
 ferences, be sequestered^or confiscated, it being unjust and impolitic that debts 
 and engagements contracted and made by individuals, having confidence in 
 each other and in their respective Governments, should ever be destroyed or 
 impaired by national authority, on account of national differences and discon- 
 tents." 
 
 Sir, this is the very time when the equitable obligation of this treaty (and 
 as a matter entitled to consideration in equity I introduce it) applies with 
 force. We now have national differences with Great Britain, and a stock of 
 discontents sufficiently strong and extensive. By " destroying" the Bank of 
 the United States (and to refuse to renew its charter is to destroy it) we es- 
 sentially "impair" the ^engagements," not of individuals only, of the one 
 nation with individuals of the other, but the " engagements" of our Govern- 
 ment 'itself with some of those individuals. AVhen the Barings purchased of 
 our Government two thousand and two hundred and twenty shares of stock 
 in the Bank of the United States, for vyhich they paid one million two hun- 
 dred and eighty- seven thousand and six hundred dollars, would they have 
 made the purchase if the Government intimated its intention to destroy the 
 bank in eight years? No sir. By the dissolution of the bank, the stock so 
 purchased being reduced from 145 to 100 dollars in value for each share, a 
 difference is made to the Barings of three hundred and ninety-nine thousand 
 and six hundred dollars, which they lose. 
 
 Sir, I have no personal interest in the Bank of the United States. I am no 
 stockholder. I have not the means of being one. Nor is the branch at Bos- 
 ton of equal import to the citizens of Massachusetts, with the bank itself and 
 its branches to the inhabitants and commercial cities of other States; although 
 the withdrawing of seven or eight hundred thousand dollars from the banking 
 capital at Boston, would undoubtedly produce some serious inconveniences. 
 
 But, sir, 1 consider the Bank of the United States, with its branches, of 
 immense importance to the citizens of the United States, and a necessary in- 
 54 
 
426 BANK OF THE UNITED STATES. 
 
 strumeiit in the hands of the Government, in the management of our great 
 national concerns. I shall, therefore, give my vote for the renewal of itfc 
 charter. 
 
 Mr. BRENT. Mr. President: Having been prevented from finishing the re- 
 marks which I had intended to make, on the subject under discussion, when 
 I last had the honor to address this body, from the late hour of the day to 
 which it was detained, 1 will avail myself of this opportunity to make a few 
 desultory observations, which the want of time prevented me from heretofore 
 submitting to your consideration. I formerly remarked that many gentlemen 
 had avowed that the principal cause that induced them to vote against this bill 
 was the large portion of the stock of the Bank ot the United States which was 
 held by foreigners, which caused a foreign influence to exist in this country, 
 which was incompatible with its safety, and that, after the termination of this 
 bank, they were willing to join in the creation of another, in which our own ci- 
 tizens only would be interested. I insisted that, if it was desirable to get rid 
 of foreign stockholders, (which I did not believe) this could not be effected 
 by the destruction of that bank, for the reasons I then had the honor to suggest. 
 I will here add one or more additional reasons why I entertain this opinion. 
 If foreigners can employ their capital here to greater advantage than in their 
 own country, it will be impossible to prevent them from subscribing to the 
 shares of the new bank you create. If you propose to do so by prohibiting 
 them from being stockholders, the law will be avoided by the subscription 
 being made in the name of our own citizens, who will hold it for foreigners, or 
 even if the shares should be wholly taken by our citizens they would after- 
 wards sell to foreigners so that the same foreign influence exists, (if such is 
 the effect of stock being held by foreigners.) Nor, sir, is this apprehended for- 
 eign influence in any degree diminished if this bank is destroyed and a new 
 bank should not be created. In such a state of things those foreigners, who, it" 
 there existed a Bank of the United States, would have invested their money 
 in its stock, now invest the same quantity of money in the State banks. Of 
 course the same extent of foreign influence (as far as foreigners holding our 
 stock produces this result) in either state of things exists. This reasoning, 
 Mr. President, is addressed to those only who are so very apprehensive of 
 the dangerous influence which the investment of foreign capital here produces. 
 For myself I entertain no such fears; and for the reasons I have heretofore had 
 the honor of stating, do very much question whether it is not most advanta- 
 geous that foreigners should hold extensively the stock of our banks. 
 
 Some gentlemen are anxious for the dissolution of the bank, because they are 
 of opinion that banks of every kind, and under every modification, are injurious. 
 Perhaps they may be so. But does the destruction of this bank remove or 
 diminish the evil society is to suffer from the existence of banks? If this bank 
 is dissolved, the State banks will exist, and new ones be created to fill up the 
 vacuum of bank circulating paper which is produced by the dissolution ot this 
 bank. If the' community is to be oppressed with such institutions as banks > 
 to the same extent, whether or not there exists a national bank, is it not better 
 to have a national bank than to put the Government to the necessity of carry- 
 ing on its fiscal arrangements by the co-operation of State banks, which are 
 in no respect under its control ? 
 
 Among other reasons urged by the honorable gentleman from Maryland 
 why there would be no inconvenience attending the dissolution of the Bank 
 of the United Statesindeed why there would almost be an advantage from 
 such a measure he insists there is at this time about 20,000,000 of dollars 
 due our merchants from those of England; and such was the deranged state of 
 the commercial resources in that country, that our merchants could not now 
 obtain payment of their British debts; but that, on the dissolution of the Bank 
 of the United States, this seven millions of stock, which was held by foreigners, 
 would be applied in part payment to our merchants, of the debt due to them 
 from the British; so that this money would not go out of the country, but 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 427 
 
 would be immediately paid to our merchants and go to that extent in the in- 
 crease of their resources. 
 
 Now, Mr. President, it appears to me, notwithstanding the high respect I 
 entertain for the honorable gentleman's mercantile and political knowledge, 
 that, in this instance, his opinion is not accurate. Either the British merchants 
 that are indebted to ours are solvent, or otherwise. If the first, they can pay 
 our merchants the $20,000,000 they owe them, in the present state of things; 
 if they are not solvent, is it to be believed that the stockholder?, after receiv- 
 ing money from the bank to the amount of their stock, will, with this money, 
 purchase bills which will be protested for non-payment? For such must be 
 the result, if the British merchant is not, at present, able to pay his debts to 
 our merchant. To me it seems mast probable that, on the dissolution of the 
 bank, one of two events will take place. Either the seven millions, the 
 amount of foreign stock, will be invested in our State banks, or it will be re- 
 mitted to Europe in actual specie. If it should be invested in our State banks, 
 the same extent of foreign influence remains in our country which we are so 
 anxious to get rid of; and, so far as relates to this difficulty, the dissolution 
 of the present bank has no operation. If these seven millions are not invest- 
 ed in State bank stock, and good bills cannot be obtained to transmit it, as is 
 clearly deducible from the statement of the gentleman from Maryland, then 
 it must go in actual specif. An honorable gentleman from Massachusetts, of 
 ureat and unquestionable mercantile information, has supposed there is not in 
 the Tinted States more than ten millions of dollars in specie. If, by the dis- 
 solution of the bank, seven of these ten millions are to be exported from our 
 country, will it not be attended with serious consequences, more especially, 
 since it has already been discovered that the quantity of the precious metals 
 in the United States has, for SOUK- years past, been diminishing, tosuch an ex- 
 tent, that it has been thought by several, important that Congress should take 
 some steps to guard against the continuance of this evil? Another reason 
 which might induce the holders of this stock, when the amount is paid off. to 
 transport the specie instead of purchasing bills, is the great and increasing dif- 
 ference in value between the actual value of the same nominal amount of pa- 
 per and specie in England. In the remarks which I heretofore had the honor 
 to submit to the Senate, I suggested that it was more than probable that the 
 dissolution of the Bank of the United States might seriously affect our reve- 
 nue. In addition to the reasons then insisted on as leading to this con- 
 clusion, permit me, Mr. President, to remark, that if, at the same moment 
 you diminish the circulating medium of the nation, (which, to a certain extent, 
 is effected by destroying the Bank of the United States) and call upon your 
 merchants immediately to pay fourten millions of dollars, the amount of the 
 debt they owe the banks, and, at the same time, to pay twelve millions to the 
 Government, which is the amount of the bonded revenue, at a period when our 
 commerce has been struggling for many years with the accumulated difficul- 
 ties produced by spoliations, by embargo, and non-intercourse laws I say, 
 Mr. President, under such circumstances, is it unreasonable to entertain 
 some apprehension that our merchants, finding themselves unable to surmount 
 all the difficulties with which they are surrounded, will, in their choice of dif- 
 ficulties, pursue the common dictates of prudence, and, choose the least? Is 
 it not probable that they will, in the first instance, take every step to secure 
 their bank endorsers, by settling their debts with the bank, andleave the Go- 
 vernment to bring suit on their revenue bonds? Such an event is the more to 
 be deprecated, as this is, of all others, a period when we should be cautious 
 about adopting any measure which would diminish the receipts of our trea- 
 sury, already much curtailed by our late embargo, and which will be consider- 
 ably affected by our non-importation law. 
 
 The remark I made some days past, in relation to a supposed incapacity of 
 the Bank of Virginia to the wants of the country, was, that it had been sug- 
 gested to me that it had produced in Richmond a great deal of usury, or, as 
 it is commonly called, money shaving. In making this observation, Mr. Pre- 
 sident, it was not my intention to reflect, in the most distant manner, on the 
 
428" BANK OF THE UNITE1> STATES. 
 
 president, or any of the directors of that bank. I know not the name of any 
 one gentleman in the direction. For all that I know or have heard, the affairs 
 of that bank are as ably and as honorably conducted as those of any bank in 
 the United States, or elsewhere. The tact which I stated was one which I 
 suppose to be an unavoidable result when you go into the banking system, and 
 do not create a banking capital adequate to the wants of society. If you es- 
 tablish a bank with an adequate capital, favorites go into the bank, get the 
 money out of it, and apply it to usurious purposes; it is no reflection on a 
 bank, to say that it has its favorites. When t more applications are made, or 
 more good paper offered than can be accommodated, a selection must be made, 
 and some applicants remain unaccommodated, who will be compelled to give 
 usurious interest to those who have been accommodated for the very money 
 which this accommodation has supplied them with. My honorable colleague 
 is of opinion that the bank of Richmond has a capital of sufficient extent, and 
 that all who deserve accommodations there can obtain them. I can only say 
 that I have repeatedly heard a very different statement, in Richmond and else- 
 where. Another fact, too, I beg leave to mention. I am well acquainted with 
 a very intelligent officer of the branch bank at Petersburg, who has informed 
 me that, almost always, more good paper is offered to the board of directors 
 than could be accommodated, from the limited extent of their banking capi- 
 tal; and it would seem an extraordinary phenomenon, that, when Richmond 
 and Petersburg are onlyjtwenty-five miles distant, there should be a redundan- 
 cy of banking capital at the former, and such a deficiency at this latter. 
 
 I now, Mr. President, approach the discussion of a question which excites 
 with me more sensibility than is produced by any considerations connected with 
 the subject now deliberated on. It is principally with a view to investigate this 
 delicate and interesting question that I have been induced at the present hour 
 to solicit the attention of this honorable body. We are told that this question 
 concerning the re-chartering of the Bank of the United States is a party ques- 
 tion, and, from the vociferous and earnest reiteration of this assertion^ it is evi- 
 dent that this invidious inference is intended to be derived from it, to wit: that,, 
 at the first establishment of the Bank of the United States, it was contested on 
 constitutional grounds; and that its favorers orits opposers marked the federal or 
 republican character, and designated the individuals who formed the body of 
 these two great political sects; that the same characteristic adheres to the bill 
 now before us, and that such of those who have heretofore been considered as 
 appertaining to the republican party, as give give their sanction to this bill, must 
 hereafter be considered as apostatizing from that political sect with which they 
 have heretofore been arranged. I will hrst inquire into the justice of this asser- 
 tion, as it relates to the matter of fact, at the first establishment of the Bank of 
 the United States; and next, as to the honorable and generous inference which 
 these magnanimous asserters attempt to derive from it. [Mr. SMITH wholly 
 denied that he had ever called thisaparty question, or viewed it in this light.] 
 Mr. BRENT said that he had never heard the honorable gentleman make such 
 an assertion, but he had been informed it was attributed to him. The hon- 
 orable gentleman's declaration is, however, perfectly satisfactory to me; I 
 am satisfied that he is incapable of making so invidious and unfounded an ac- 
 cusation. I am too well acquainted with that honorable gentleman's good 
 sense and liberality. He will therefore be so good as not to consider any re- 
 marks I shall make on the particular question that I am now investigating as 
 applying to him, but to others who act with him, as to the generafond ultimate 
 fate of the bill under consideration. That, among the great mass of the Peo- 
 ple in some sections of the Union, particularly the State I represent, this 
 measure establishing the Bank of the United States, was taken up as a party 
 question, may be admitted; but that it was viewed in this light in either House 
 of that Congress which passed the law; that the votes which were given, either 
 affirmatively or otherwise, were the test to ascertain who was of the republi- 
 can and who of the federal party, is an assertion destitute of all foundation: 
 for whoever will examine the yeas and nays of both Houses of Congress, \yill 
 find some of our most distinguished republican patriots voting for the bill. 
 
ON THE_BILL TO RENEW THE CHARTER OF 1791. 
 
 while others, equally eminent and zealous in the federal ranks, will be found 
 in hostility to it. Sir, the journals of Congress, testimony derived from sol- 
 emn and unquestionable records a species of evidence which the laws of our 
 country, and the practice of our courts, in the gradation of the different spe- 
 cies of testimony, places in the higest station, and considers as of the most im- 
 posing authority demonstrate that the assertion, that the question concerning 
 the establishment of the Bank of the United States, in the first instance, was 
 entirely a party question, is destitute of all foundation. That an assertion so 
 susceptible of refutation, by testimony so irresistible, should have been made, 
 is evidence to me of the unjustifiable length to which some gentlemen will 
 permit their zeal to transport them. Nay, Mr. President, let me call your 
 attention to the only member, as I believe, of this honorable body, who was 
 a member of Congress when the law establishing a Bank of the United States 
 took place, (I mean the honorable Mr. OILMAN.) This gentleman is known 
 to be a republican; yet the journals will assure us, that he voted for the bill 
 establishing the bank. 
 
 If the opinion of the constitutionality or otherwise of the Bank of the United 
 States is the criterion by which the estimate is to be made of the political sect 
 to which each individual belongs, what shall we say of Mr. Jefferson, and the 
 majorities of the two Houses of Congress during his administration, who, by 
 repeated acts, recognised the legality and constitutionality of this institution? 
 Shall we say that he and they have apostatized from the republican cause? Do 
 the presumptuous and daring asserters pretend to impose upon us a belief 
 thai, during a period which we have hitherto supposed \vas the proudest tri- 
 umph of republicanism, those of the dominant party had apostatized from the 
 republican cause? Are we to believe that, during the administration of Mr. 
 Jefferson, the great apostle of republicanism one with whose name republi- 
 canism has been supposed to be identified arc we to believe that he has apos- 
 tatized from his political party? Are there any so presumptuous as to ima- 
 gine they can impose upon the public mind or upon this honorable body so 
 monstrous, so absurd a belief? Can you be induced to select that moment 
 which has hitherto been imagined most auspicious to republican principles, as 
 the one when, above all others, there was a total apostacy from them? No, 
 sir, every effort is vain which is made to impose upon us so irrational a belief. 
 On the contrary hand, we will account for the conduct of Mr. Jefferson, and 
 the republican majorities in Congress, during his administration, when they 
 sanctioned, by repeated laws, the constitutionality of the Bank of the United 
 States, by the considerations I proceed to enumerate. Whatever might have 
 been the abstract opinion of Mr. Jefferson respecting the constitutionality of 
 the bank, on its first institution, it is now immaterial to inquire. He saw, 
 vyhen he came into the Presidency, that this was, in its origin, not a party ques- 
 tion; but that the journals of Congress would evince that, on the vote which 
 first gave a sanction to this measure, all party distinction was confounded; 
 that it was one of those questions, which, when first agitated, was calculated 
 to produce a diversity of opinion among men of the purest intentions and of 
 the most luminous understandings; that it was one of those doubtful questions 
 \vhich, when once settled by precedent, should never again be agitated; that 
 this measure had been sanctioned, after the fullest deliberation had been be- 
 stowed upon it; and that we had so incorporated this bank establishment with 
 our fiscal and other governmental arrangements, that it could not, at that 
 time, be put down without impairing the public credit, and without being like 
 (in various other points of view) to be productive of very serious and nume- 
 rous calamities to the community. From all those various considerations, Mr. 
 Jefferson, when he came into the administration, as also a majority of Con- 
 gress during that period, considered the question respecting the Bank of the 
 United States as a settled and adjudicated one, which was now to be acqui- 
 esced in, and pursued a system of policy in conformity with this sentiment. 
 On any other principle, the conduct of Mr. Jefferson and of Congress would not 
 only not be justifiable, but would be criminal in the highest sense. If they 
 had considered this a party question a measure which the federal party, dur- 
 
430 BANK OF THE UNITED STATES, 
 
 ing its ascendancy, had established, contrary to the manifest and unquestion- 
 able principles of the constitution, (as some gentlemen now contend) every 
 step that was taken to sanction this unconstitutional measure was inflicting 
 a new wound on the constitution, and a violation of the sacred oaths they had 
 taken to support it. To say that it was done for the support of public faith, 
 because the law incorporating the bank had made a contract with individuals, 
 is irrational and fallacious, because no unconstitutional law can pledge the 
 faith of Government. An unconstitutional lavy incorporating a body ot men 
 can give them no legal existence which can be binding on a subsequent legisla- 
 ture. It is, as was well observed by my colleague, to enter into a contract with 
 an idiot or married woman. The contract is, ipso facto, void. If an uncon- 
 stitutional law cannot pledge the faith of Government or a subsequent legis- 
 lature nay, more, if it is incumbent on a subsequent legislature to repeal 
 such unconstitutional law then the law establishing the Bank of the United 
 States, if it is of this description, (that is, evidently unconstitutional) impos- 
 ed no other obligation on Mr. Jefferson and his republican majority, than im- 
 mediately to repeal it, and to restore to its original purity that constitution 
 they had sworn to support; but when the very opposite conduct is pursued, 
 we must presume it was done from an idea that the constitutionality of the 
 bank, in its origin, was one of those questionable principles which might cre- 
 ate doubt between individuals of all parties, and on which men of the best 
 understanding might pause and hesitate; but being once determined on, was 
 to be considered as an adjudicated case, which the repose of society made it 
 proper should never again be drawn into discussion. This, sir, I think, is a 
 justifiable inference. Are we not then warranted in saying, that the assertion 
 that this is a party question, with all the bearings it is intended to have, is 
 destitute of all foundation? That the law concerning the Bank of the United 
 States was not, in its origin, a party question, is demonstrated by the journals 
 of Congress. Whenever this measure was agitated, during the administration 
 of Mr. Jefferson, it was not taken up as a party question, because all parties 
 gave it their concurrent support. It remains to be inquired whether, on the 
 present occasion, the bill under your consideration is to be viewed as a party 
 question. In order to ascertain the character of a question, that is, whether 
 it is a party one or not, it is first necessary to ascertain who are the different 
 individuals that constitute the different parties, and how these individuals 
 stand in relation to the question to be decided on- If all, or almost all of each 
 political sect are arranged, one for, the other against, the measure, then it may 
 be deemed a party question; but if a very large portion of one of your political 
 parties, carrying with it some of your most distinguished members, is found 
 opposed to another portion of its own party, you can no longer call this a party 
 question. Each portion of this divided party may claim its exclusive identi- 
 fication with the party itself, and upbraid the other with the epithet of apos- 
 tate; but their pretensions will not be admitted unless supported by higher 
 authority than that which is derived from the arrogance of one section of this 
 divided party. 
 
 When I view the journals of the House of Representatives, and cast my 
 eyes over the yeas and nays on this question, as decided there some days past, 
 and find some of the most zealous and distinguished republicans in the affirm- 
 ative; when I reflect on the number and great weight of character of the re- 
 publican members of this honorable body, who concur with me in opinion that 
 it is proper the rei incorporation of the bank should prevail; I consider it 
 as the height of arrogance, and the most baseless of all unfounded pretensions, 
 in those of the republican party who are opposed to this measure, to call this 
 a party question; to identify themselves exclusively with the republican party; 
 and to insinuate that such republicans as vote for this bill have abandoned 
 their political principles. By what authority can those republican gentlemen, 
 who oppose this bill, appropriate exclusively to themselves the character of 
 republicans? Are there not, among those of the republicans who are in favor 
 of this measure, men of as great weight of character as those who are opposed 
 to them? Men, who can offer as distinguished anil as proud and elevated pre- 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 tensions tor the zeal, the diligence, the fidelity, and the fortitude (hey dis- 
 played in the republican cause, during the period of its adversity, as any this 
 country contains? Who, sir, in the hour of difficulty, at that period which 
 tried men's souls when republicanism meant more than a name, and its advo- 
 cates were stigmatised as factious demagogues, and upraided with every 
 odious epithet who, sir. at this inauspicious moment, occcupied a more emi- 
 nent and distinguished station in the republican ranks, than the present Secre- 
 tary of the Treaury, who is the first to recommend this measure? And is Al- 
 bert Gallatin, one of those who pre-eminently contributed to form the Atlas, 
 on whose shoulders the fate of republicanism rested, at the moment when it 
 u;i- surrounded with such numerous and ferocious assailants is he not a re- 
 publican? Nay, Mr. President, are there none in this body of the veteran po- 
 liticians who contributed to form that Spartan band who so nobly defended 
 the republican cause when it exposed its advocates to every species of obloquy 
 and political persecution are mere none of that description in this body tnat 
 mean to vote tor this bill? It will with justice not be denied. Mr. President, 
 who are the characters who have proclaimed this to be a party question? Does 
 my colleague, who was inferior in zeal and efficiency to no one in the councils 
 of our country, at the awful crisis I have been speaking ofdoes he call this 
 a party question? Does the honorable gentleman from Maryland, who also 
 bore his share in the honorable conflict for republican principles does he call 
 this a party question? No, *ir: they each know the reverse, and are too honor- 
 able and just to make such an insinuation. It is not, sir, from those political 
 veterans, whose standing might justify them for making some pretension, thai 
 this exclusive claim to republicanism is in>i>ted on, both within and without 
 our doors. It is made by characters, that, at the period of republican adver- 
 sity, were nor known in the councils of our nation, or were, perhaps, in most 
 instances, boys at school. And are these unfledged, fair-weather politicians, 
 in these halcyon days of republicanism, to attribute to themselves the exclusive 
 monopoly of republican principles, and stigmatize as apostates those veteran 
 politicians to whose persecutions and exertions the triumph and preservation 
 of republican principles can alone be attributed? These, sir, are modest pre- 
 tensions, and the public will duly appreciate them when they learn the source 
 from v, hence they come, and the characters to whom they are to be applied. If 
 to be of an opinion that there is a constitutional power in the General Govern- 
 ment to establish a national bank, is an apustacy from the republican cause, 
 then Mr. Jefterson and the two houses of Congress during his, administration, 
 who considered this a settled and an adjudicated point, and, in repeated in- 
 stances, legislated on this principle, and passed laws recognizing the consti- 
 tutionality of such an institution then, sir, I say, Mr. Jefterson, and the ma- 
 jority -of the two houses of Congress, during his administration, have aposta- 
 tized, as also has Albert Gallatin, who, relying on the score of precedent, has 
 considered this as an adjudicated question, and, in his report, recommended 
 its adoption he also has apostatized from the republican party. Mr. Presi- 
 dent, I remember to have heard an instance mentioned, when a gloomy and 
 ferocious fanatic was pronouncing eternal damnation on all who died without 
 the. pale of his church, that a more benevolent and liberal person, who heard 
 him, in order to obviate such monstrous doctrine, enumerated a great many of 
 the most amiable of their common acquaintance, and even relatives, whom the 
 hand of death had taken from them, that were not of the same religious tenets 
 with this fanatic, and interrogated him what had become of each of these ami- 
 able and dear friends and relations? The fanatic replied, they were all in hell; 
 to which the interrogate!' rejoined, that he also would go to hell, for he was 
 sure, if the information he had just received was true, he should find better 
 company there than in any other region he could repair to. With the same 
 desire to get into good company, if Mr. Jefferson, and the majorities of Con- 
 gress during his administration, and Albert Gallatin, have apostatized from 
 the republican party, I also am content to be an apostate. I am sure I know 
 of no political sect that have manifested opinions so congenial with my own 
 as they have done, and with them I wish to be associated. 
 
432 BANK OF THE UNITED STATES. 
 
 Mr. President, I will beg leave to remind these new-born, unknown, self- 
 created, exclusive republicans, who hurl apostacy and other denunciation with 
 such liberality against all that will vote for this bill, that many of their own 
 party many of those who vote with them avow a belief, that Congress has 
 the power to create a bank, but they do not think it expedient at present to 
 recharter this bank. 1 understand the honorable member from Maryland has 
 candidly and honorably avowed this opinion; many others are known to enter- 
 tain the same sentiments (though they will not acknowledge them with the 
 same candor) who have and wilt vote against this bill. To those who enter- 
 tain this sentiment, how can this be a party question? The only incident which 
 gives it the character of a party question is, the opinion that such a law is 
 constitutional or otherwise; and a determination to vote in the affirmative or 
 negative, as that opinion shall dictate. Now, to such gentlemen as believe the 
 law constitutional, and yet vote against it, it cannot be a party question. 
 Those who are in this situation, and endeavor to overthrow the bill by the. 
 prejudices they may create against it, by affecting to call it a party question, 
 though secretly, and in their own minds, they entertain no such belief such 
 gentlemen, Mr. President, as act in this manner, fight under false colors. 
 
 Mr. President, it is painful for any gentleman, when addressing this House, 
 to speak of himself, and to make his past political conduct the theme of his 
 observations; but, in an instance like this, when insinuations are made, so 
 calculated to excite the most poignant sensibility; when a charge of inconsist- 
 ency and dereliction of former political principles is made; it is pardonable to 
 take a review of our past political conduct, for the purpose of repelling charges 
 which create emotions proportioned to the ardor and fidelity with which we 
 are conscious of cherishing those principles which we are accused of having 
 abandoned. During the most arduous conflicts of the republican party, at a 
 time when it was borne down by domineering and tyrannical majorities, al- 
 though I occupied no prominent station, it certainly was not my fortune to 
 repose upon a bed of roses. It was at this most inauspicious period, as it re- 
 spected the fortune of the party to which I was attached, that I first acquired 
 a seat in the other branch of the National Legislature. The four years during 
 which 1 retained it may be considered as the very time when, above any 
 other, party intolerance was carried to the greatest excess; when a republican 
 was almost hunted down in the streets of Philadelphia, where Congress then 
 sat; when the republican members were reduced, in Congress, on great and 
 critical questions which served most precisely to designate the two parties, to 
 a very inconsiderable body; when, to be called a republican, was, in the esti- 
 mation of the dominant party, to promulgate outlawry against you in the code 
 of humanity, and to cut you oft' from almost all the charities of life. At this 
 period, sir, it was my fortune to represent the only federal district in the State 
 of Virginia (and to be the only republican representative that this district, 
 either before or after, elected to Congress. ) It was my fortune to receive, 
 during this adverse and tempestuous period, almost innumerable addresses 
 from my constituents, which I was made the organ to present to the President 
 of the United States, stigmatizing with the severest animadversions my politi- 
 cal conduct, and that of the party with which I thought and acted. Let the 
 journals of the House of Representatives, during this alarming and eventful 
 crisis, be examined, and let the recorded votes of that body be resorted to, in 
 order to ascertain whether I was inferior in promptitude, fidelity, and ardor, 
 for the republican cause, to any member of that republican party. During the 
 whole of this period, I was suffering under the most painful state of ill health; 
 yet, such was my anxiety to show my disapprobation of the ruinous measures 
 pursued by the then dominant and infatuated party, that 1 occupied my seat 
 in Congress in very many instances when, if 1 had attended to my own ease 
 and health, I should have confined myself to the bed; and I challenge the 
 most minute and accurate investigator to point out one instance where any 
 measures were taken in Congress, calculated to interest party feeling, when I 
 was absent from my post, or failed to attest, by my vote, the sincerity of my 
 devotion to the republican cause. Under these circumstances, I had nattered 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 435 
 
 myself that I had some humble pretensions to the public confidence, when I 
 professed my early and continued devotion to the principles of republicanism: 
 but I discover that I am mistaken, and that a new order of fortunate pohtf- 
 cians have come into existence, in the present propitious hours of republican- 
 ism, and have so exclusively engrossed the whole of this precious commodity, 
 that they will not permit their elder order of political men, to whose exertions 
 it is indebted for its very existence, to have one particle pt it. If this new 
 created order of patriots will banish me, and all who think with me on this occa- 
 sion, from the republican ranks, they cannot deprive us of this consolation, 
 that, in the state of exile and denunciation, they place us in company at least 
 as respectable as that from which we are driven. If, to be associated in the 
 same political class with the late President, with the majorities of Congress 
 during his administration, and with the Secretary of the Treasury, in contra- 
 distinction to this new order of exclusive republicans, is the result of these 
 denunciations, I am willing to encounter their consequences. 
 
 Mr. President, if I, and those of the republican party who act with me, on 
 the present occasion, have apostatized from our former political principles, I 
 can say with truth, so far as the charge respects myself, that the motive by 
 which I am actuated, must not only be disinterested, but very different from 
 that which generally operates on the human mind. In the most gloomy hour 
 of republican adversity, during the severest denunciations and persecutions 
 which it experienced at an hour when our political hemisphere was pregnant 
 with a tempest which threatened destruction to all its votaries; when I repre- 
 sented the only federal district in the State of Virginia, and my constituents 
 were constantly sending on loyal addresses, in the most pointed manner, ani- 
 madverting on the party with whom I was associated: under all these adverse 
 circumstances, 1 was not inferior to any one, in fidelity and zeal for the re- 
 publican cause. But at this period of republican triumph, when, to be asso- 
 ciated with that party, is the best passport to all the honors and offices of our 
 country, when I am elected to a seat in this very elevated and honorable body 
 by the vote of a republican Legislature, of one of the most uniformly and una- 
 nimously republican States in the Union; in such a crisis, and in such a state 
 of things, I nave abandoned the republican party! If the charge be just, I can 
 only repeat, that I must be actuated by motives very different from those 
 which generally operate on the human bosom. No consideration of pecuniary 
 aggrandizement could have had any operation on me in relation to the sub- 
 ject under consideration; any other than a wish to advance the general hap- 
 piness of society : for, 1 never had a bank share in any bank whatever, nor have 
 I ever had any negotiation with, or requested or obtained a loan for one penny 
 from, the Bank of the United States, or any ot its branches. I must here re- 
 mark, if this abandonment and tergiversation of political principles is justly 
 attributable to me, I am not conscious of the motive which produced it. Whe- 
 ther I shall be considered faithful to republican principles, my country must 
 determine arid to this tribunal I cheerfully appeal; but whether, in the vote 
 I am about to give, I shall evince uniformity ot political principles, is not a 
 
 ?uestion that I will submit as a matter of doubt, for the decision of any one. 
 t is a matter of fact, susceptible of immediate and conclusive demonstration. 
 The first time I was a candidate for a seat in the House of Representatives, 
 a gentleman who was a competitor with me for that station, published a 
 lengthy address to the freeholders of the district, which we each wished to 
 represent, which was, in some measure, a profession of political faith, and 
 seemed to call on me to make public a similar exposition of my political sen- 
 timents. The question concerning the Bank of the United States was then 
 a topic more generally adverted to than it has been for some years past; it 
 was of course dilated on in the address of my competitor, which imposed an 
 obligation on me to express my sentiments on this subject, in the answer which 
 I published to this address. I have no copy of my answer in my possession, 
 nor have I seen it for several years; but I have no doubt but some copies of 
 it are to be found, and, if they can be found, it will be seen that I therein 
 waive all considerations respecting the original constitutionality of the bank, 
 55 
 
434 BANK OF THE UNITED STATES. 
 
 and, after making some remarks respecting it, which I do not now recollect, 
 conclude with observing, that, however inexpedient at first, it cannot now be 
 touched without impairing public credit, and shaking our constitution to its 
 base. These, I think, are the very words used in my answer. Thus, sir, 
 recorded evidence may be produced, that, in the very first act of my political 
 life, (as relates to the General Government) on the 'first promulgation of my 
 political sentiments, when I was a very young man, I avowed the sentiments 
 I now profess, and in conformity with which, I now act. If I was a repub- 
 lican at the time T published this answer; if the sentiments it contained con- 
 signed me in the public estimation to the republican party; if I acted, and shall 
 act, in my political career, in conformity to these sentiments; I have some 
 latent suspicions that I should have some pretensions to the character of a re- 
 publican, if it were not discovered that a new order of patriots has lately 
 arisen, which has exclusively appropriated to itself every republican attribute, 
 and will not permit any of its benign influence to animate the bosoms of those 
 who have preceded them in the theatre of public life, though it is exclusively 
 owing to the exertions of the latter that its genial and hallowed flame has 
 not been entirely extinguished. From the exposition I have just made, what- 
 ever may be the political sect with which I and many others of my more 
 illustrious political associates are arrayed, I hope it will at least be admitted, 
 that I have acted with consistency, and in conformity with my earliest pro- 
 fessions. I am conscious of possessing but little political merit, and my 
 anxiety to have credit for what little I do possess, is augmented from my con- 
 sciousness of the scantiness of the general stock. When we possess but little, 
 that little is our all, and its value is proportionally enhanced from this con- 
 sideration. Consistency of political opinion, and steady adherence to those 
 tenets with which I had commenced my political life, was one of those hum- 
 ble recommendations for public confidence, to which I flattered myself I 
 could make some just pretensions; nor will the review 1 have just taken of the 
 commencement and progress of my political life, diminish these pretensions. 
 Whether this new order of exclusive republicans, who have made their ap- 
 pearance upon the theatre of public life more recently than it was my fortune 
 to do, shall succeed in excluding from the republican ranks the late President 
 of the United States, and the majority of Congress during his administration, 
 as also the Secretary of the Treasury, and all the republican members of Con- 
 gress who vote for the bill under consideration I say, Mr. President, whe- 
 ther this is effected or not, in either case, the charge of apostacy or derelic- 
 tion of political principles cannot apply to me, because I now act in strict 
 conformity with the profession of political faith which I made at the com- 
 mencement of my public life, (in relation to^the Government of the United 
 States.) With whatever political sect I may be associated, in consequence 
 of the affirmative vote I shall give to the bill now deliberated on, from the con- 
 siderations already enumerated, I shall at least stand absolved from all im- 
 putations of inconsistency, insincerity, or apostacy. My candor cannot be 
 impeached; I cannot be accused with advocating now a doctrine I once re- 
 probated; nor of vibrating in my political opinions, with a vibrating state of 
 things. Nor has any one a right to question the sincerity of the solemn decla- 
 ration I now make, that I every day cherish with a fonder affection my attach- 
 ment to those just and leading political principles to which I was attached, 
 and which I professed at the commencement of my political life, because 
 every passing day's experience serves more firmly to convince me of their 
 accuracy ana superlative excellence; and that the preservation of those prin- 
 ciples, in their utmost purity, is best calculated to preserve the liberty, and 
 promote the general welfare of the nation. 
 
 Mr. CRAWFORD said he regretted extremely, that, at so late an hour, he was 
 constrained to throw himself upon the indulgence of the Senate, especially 
 as the subject was so much exhausted, by the able and animated discussions 
 which had for so many days attracted their attention. Before I enter upon 
 the few remarks which I feel it my duty to make, in reply to the numerous 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 435 
 
 comments which have been made upon the observations which I had the honor 
 to submit to the consideration of the Senate, at the commencement of this 
 discussion, permit me, sir, to acknowledge the liberality and indulgence with 
 which those observations have been generally treated. In the course of the 
 few observations to which I intend to confine myself, it shall be my endeavor 
 to exercise that indulgence towards others, which has been extended to me. 
 The gentleman from Kentucky (Mr. CLAY) complains of the committee, be- 
 cause they have listened to the representations of two delegations from the 
 city of Philadelphia, who presented memorials to the Senate, who referred 
 them to the committee; and, because the committee have, in his opinion, given 
 adventitious importance to their representations, by the minuteness, and by 
 the pomp and parade, with which they have been detailed to the Senate, 
 will be recollected that the committee did not seek the post which has been 
 assigned them by the Senate, nor did they desert it, after it was assigned to 
 them. The object of referring petitions to committees is to collect mat in- 
 formation which the Senate ought to have, before it acts, and which, in its col- 
 lective capacity, it cannot Obtain. It has always been the practice of com- 
 mittees to permit the petitioners to be present at their meetings, to make 
 such explanations, and to give such information, touching the subject of their 
 petition, as they think connected with it. It is the duty of committees to 
 detail to the Senate, the information which they collect, to enable the mem- 
 bers to take a full view of the subject upon which they are called upon to act. 
 The committee, in the present case, has done all this, and it has done nothing 
 more. Had it puraaed a different course, it would have justly subjected it- 
 self to the animadversions of the Senate. To the information collected by 
 the committee, from these delegations, and laid before the Senate, my friend 
 from Maryland, (Mr. SMITH) has opposed a statement of facts, and his opinion, 
 founded upon those facts. As the situation and talents of that gentleman en- 
 title his statements and opinions to sreat weight; as it is more than probable 
 that the votes of several members will ultimately rest upon the weight of his 
 authority; my honorable friend from Maryland (Mr. SMITH} will pardon me 
 if I should examine his observations rather according to me rules of evi- 
 dence, than those of logic. In making this declaration, I wish to be explicit- 
 ly understood as excluding eyeiy idea of charging that gentleman with having 
 made statements which he did not believe, or with having given opinions he 
 did not entertain. 1 have no doubt but that he sincerely believes in, the 
 correctness of his statements, and in the accuracy of his opinions; but if, in 
 the course of my observations, I shall- prove, incontestibly, mat he is mistaken 
 in soine of his statements and opinions, it will teach the Senate the necessity 
 of weighing the remainder of them with great circumspection. If I shall be 
 able to shesv that he is mistaken in a case, the evidence of which is matter of 
 record, that circumstance alone will induce the Senate to reject all idea of re- 
 ceiving his statements and opinions, with implicit confidence. But, sir, be- 
 fore I proceed further in my observations, permit me to notice an expression 
 which fell from the gentleman from Tennessee, on my right, (Mr. WHITE- 
 SIDES.) I understood that gentleman to say, that those republicans who thought 
 the law incorporating the bank was unconstitutional, had been guilty of apos- 
 tacy. I hope I misunderstood the gentleman; if I am mistaken, it will afford 
 me great pleasure to be corrected, because the declaration made a very strong 
 impression upon my mind, and excited the most unpleasant sensations. 
 
 [Mr. W. explained. He said, an impression had been made upon his mind, 
 that the bank charter was unconstitutional, but that he had never examined 
 the subject minutely, until it had become his duty to do it. That that exami- 
 nation had convinced him that it was unconstitutional, and that those republi- 
 cans who now supported the renewal must have apostatized.] 
 
 Then, sir, I say that this is language which no gentleman ought to use to- 
 wards any member of this honorable body; and, sir, it is language which no 
 gentleman shall, withoutthe walls of the .Senate, use tome, with impunity. 
 
436 HANK OF THE UNITED STATES. 
 
 [Mr. W. explained, by saying, that he did not say that gentlemen had apos- 
 tatized, but that he had only said, in his opinion they had apostatized.] 
 
 I wish the gentleman had been able to make a satisfactory explanation of 
 his unwarrantable declaration. What right has he to make his opinion of 
 the constitution the test of other men's republicanism? By what authority 
 does he erect his opinion as the standard of republican orthodoxy? As the 
 standard by which the republicanism of other gentlemen is to be tried? The 
 gentleman has mistaken his standing in the republican party. I disclaim all 
 authority, in a case of this kind, and more especially the authority of the 
 gentleman from Tennessee* 
 
 Mr. President, the honorable gentleman from Maryland has declared, that 
 the act incorporating the Bank of the United States was, in is origin, a party 
 question. 
 
 [Mr. SMITH explained. He did not say it was a party question, but that it 
 had given rise to party.] 
 
 If I have mistaken what fell from the honorable gentleman from Marylandy 
 I am not in what fell from the gentleman from Tennessee, on my right, (Mr. 
 WHITESIDES.) Sir, the assertion is not only without proof, but it is contra- 
 dicted by matter of record. A reference to the yeas and nays upon the bill, 
 in both Houses of Congress, will prove that many of our most distinguished re- 
 publicans voted for our bill, and some of the most respectable federal mem- 
 bers voted against it. In the observations which I made, when 1 had the honor 
 of addressing the Senate, at the opening of this discussion, I attempted to 
 show, that the idea of party, as now known, did not then exist in the United 
 States. That the parties then known were those who were the friends of the 
 federal constitution, and those who were opposed to it. Nothing which I have 
 heard advanced upon this subject, in reply to my observations, lias made the 
 slighest impression upon my mind, against the correctness of the opinion 
 which 1 then advanced^ I understood the gentleman from Maryland to say,, 
 that the Congress which passed the bill to incorporate the bank, was capri- 
 ciously apportioned r and consisted of sixty -five members; and that, of that num- 
 ber, only thirty-nine voted for it. That, if the members had been apportioned 
 as- the constitution directs, upon the principles of population, in his opinion 
 the bill never would have been passed. Sir, let us examine the correctness 
 of this opinion. Every member present but one, from the States of New 
 Hampshire, Massachusetts, Rhode Island, Connecticut, New York, New 
 Jersey, Pennsylvania, and Delaware, voted for the bill, together with two 
 from the State of Maryland, two from the State of North Carolina, and one 
 from the State of South Carolina. The eight States who voted unanimously 
 for the bank, one only excepted, upon the apportionment under the first enu- 
 meration, give a nett gain of twenty members, while the other few States, most 
 of whom voted against the bank, give a nett gain of sixteen members. Thus,, 
 sir, if we may judge of the conduct of members in a geographical point of view, 
 there can be no doubt that the friends of the bank would have been consi- 
 derably increased by a correct apportionment. The vote in the House of Re- 
 presentatives, on the final passage of the bill, was thirty-nine to twenty. In 
 the Senate, the yeas and nays were taken on two questions, during its pen- 
 dency there. Upon the first, the yeas were sixteen; the nays six. Upon the 
 motion to strike out the 12th section, which restrains the right of Congress to. 
 create any other bank during the existence of that about to be created, the 
 yeas were five, and the nays eighteen. The opinion, then, is wholly incorrect, 
 and yet the evidence upon which this opinion ought to have been formed was 
 matter of record. Sir, the gentleman from Maryland has said that this bank 
 has been mischievous in its consequences, and that, wherever it has established 
 a branch, it has immediately produced a necessity for creating other banks. 
 I would ask what has created the necessity of establishingbanks in New Hamp- 
 shire, Vermont, Rhode Island, Connecticut, New Jersey, Delaware* North 
 Carolina, and the Western States? This bank has never established a branch 
 bank in any one of these States, and yet they have, without, I believe, a sin- 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 437 
 
 gle exception, established banks; while the State of Georgia, where a branch 
 bank has been long established, has not, until within a few months past, esta- 
 blished a single bank. What cause is it that has influenced the Legislatures 
 of Maryland, Pennsylvania, and several other States, to create so many banks 
 within a few months past? Is it owing to the mischievous effects of the Bank 
 of the United States? Sir, the facts I have stated show, conclusively, that 
 the cause assigned by my honorable friend from Maryland cannot be the one 
 which has produced this multiplication of banks. Some other cause must be 
 sought for, and, in my opinion, a more rational one is ready at hand. The ef- 
 fects of the bank, and of its branches, wherever established, upon the prosperi- 
 ty of the People, and of the commerce of the place, removed the long rooted 
 objections which existed against banks, and hence their great increase in all 
 the States. 
 
 The gentleman from Maryland has stated several cases in which the State 
 banks, and the banks of this territory, have accommodated the Government, 
 where the United States had refused. The cases stated prove nothing, and 
 ought to have no influence with this Government, in establishing a permanent 
 system of revenue. Jf the State and territorial banks have, upon several oc- 
 casions, received the bills of other State banks, to accommodate the Go- 
 vernment, it was because it suited their convenience at the time. It was a 
 mere temporary transaction, and forms an exception to the general rule. The 
 charter ot no bank in the United States compels them to take the paper of 
 other banks; and whether they do receive it or not, will depend upon con- 
 tingent circumstances, or upon whim and caprice. No reliance, therefore, 
 ought to be placed upon the duration of any regulation which is not enforced 
 by their charters. The gentleman from Maryland thinks that the United States 
 will have the same influence over the State banks, that it has had, and will 
 have, over that of the Bank of the United States. If he is correct as to the ex- 
 tent of that influence, his conclusion may be correctly drawn. But, sir, is it 
 true that the National Government has no other influence over this bank than 
 that which can be produced by withdrawing of its deposites? If it is so, then 
 it must be admitted that the United States will have the same influence over 
 the State banks that they will have over one of their own creation, because 
 they can as easily withdraw their deposites from the one as the other. But, 
 sir, the United States have an influence over the Bank of the United States, 
 which is wholly independent of, and unconnected with, the right of withdraw- 
 ing their deposites from its vaults. The bank is dependent on them for its ex- 
 istence. By renewing the charter for short periods of time, you create a state 
 of dependency upon the Government, which will, at all times, make the bank 
 completely subservient to all the legitimate objects for which it was created. 
 How, sir, is it with the State banks? Upon whom are they dependent for legal 
 existence, and for length of days? Upon the State Governments. Suppose the 
 authority from which they derive their existence should place itself in oppo- 
 sition to the Government of the United States; and suppose that this state of 
 hostility should happen a year or two before the time at which their charters 
 were to expire, and the State Legislature should direct them to hold the de- 
 posite of public moneys against the demand of the National Government; 
 what course would they pursue, under such circumstances? Sir, the case 
 which I have stated is not a mere possible case. The history of several of the 
 large influential States proves, that, this state of hostility, which 1 have sup- 
 posed, is not an imaginary one. Make yourselves dependent upon the State 
 banks for the collection and transmission of your revenue, and that opposition, 
 which has but seldom happened, will become more frequent. Their disposi- 
 tion to control the operations of the National Government will increase with 
 every increase of the means of annoyance, which the folly and improvidence 
 of Congress may throw into their hands. For whose benefit, sir, is the Go- 
 vernment to strip itself of this right, so essential for the due administration of 
 its finances? Is it for the benefit of the great nfess of the American People? 
 No; not one in an hundred of them have any interest in the State banks. 
 They feel no interest in the question; their true interest is more effectually 
 
438 BANK OF THE UNITED STATES. 
 
 subserved by the operations of the Bank of the United States, than it can pos- 
 sibly be by the State banks. This bank affords them a portable currency, 
 which is of equal value in every part of the United States, while the credit 
 and currency of the State bills is local. 
 
 Mr. President, the honorable gentleman from Maryland, (Mr. S. ) says, 
 that the Bank of the United States does not facilitate the collection of there- 
 venue. If I understood the gentleman from Massachusetts (Mr. LLOYD) and 
 the gentleman from Maryland correctly, human imagination cannot devise a 
 system so peculiarly calculated to ensure the speedy collection of your reve- 
 nue, as that which is furnished by banks. Sir, I know nothing of the details 
 of the banking system; I never was inside of a. bank, except two or three times 
 in the branch bank which has been established in this city; but I understood 
 the gentleman from Massachusetts to say, that when a revenue bond, even of 
 $50, was deposited in the bank for collection, if it was not discharged when 
 due. that the obligor was refused all further accommodation in that bank, and 
 that, if his accommodations amounted to 100,000 dollars, he was called upon 
 to discharge his notes as they became due, the right to renew them being for- 
 feited by this act of default. I understood the gentleman from Maryland to 
 say, that, whenever any person was known to be in default at any bank, that 
 all the banks of the place immediately refused him credit, and demanded the 
 payment of his notes as they became due, by excluding him from the right of 
 renewing them. [Both gentlemen assented to the correctness ef the state- 
 ment.] I have then understood both gentlemen correctly. This simple state- 
 ment proves, beyond the possibility of doubt, that the bank is the most pow- 
 erful engine in the collection of your revenue, which human ingenuity can 
 devise. Credit is the true basis ot commerce. By placing your revenue bonds 
 in the bank, the want of punctuality in a single case, towards the Govern- 
 ment, shuts the door of every bank to which the defaulter had, before, had 
 access, and also of every other bank of the city in which his commercial trans- 
 actions have been carried on. And yet, we are seriously told that the ope- 
 rations of the bank have no influence upon the prompt and secure collection 
 of the national revenue. It is impossible to resist the conviction, that the 
 prompt and secure collection of our revenue is principally owing to the in- 
 fluence of the bank. But, sir, the bank has another direct influence upon the 
 collection of your revenue. By the rules established in the bank at Philadel- 
 phia, every person, whose bond to the Government is deposited there, has a 
 right, upon getting an additional endorser, to claim a discount for half of the 
 amount of his bond, and the part so discounted is immediately carried to the 
 credit of the United States, and the bank takes upon itself the risk of the ul- 
 timate collection. In this way, sir, one half of the bond is collected at the 
 sole risk of the bank, without any possibility of loss on the part of Govern- 
 ment. And yet, sir, it is contended that the bank has nothing to do with the 
 collection of the public revenue. The gentleman from Maryland says, that 
 the scarcity of money, and the alarm and dismay which the delegation of me- 
 chanics had represented, as existing in Philadelphia, could not be the effect of 
 the contraction of discounts by the Bank of the United States, because that 
 bank, as well as the State banks, are going on with their ordinary discounts. 
 This is true; but the gentleman from Maryland has forgotten, that this dele- 
 gation stated that the bank, upon the rejection of their memorial by the House 
 of Representatives, had contracted their discounts, and that a corresponding 
 contraction had taken place in the discounts of the State banks, which had 
 produced the pressure; and that that pressure had spread alarm and dismay 
 through the city. That, before they left the city, the directors of the Bank of 
 the United States had come to an understanding with the directors of the 
 State banks, all of whom had determined to resume and continue their ordi- 
 nary discounts until the last hour. Notwithstanding the banks had resumed 
 their ordinary discounts, the panic which had been produced did not cease, 
 and the scarcity of money, and the distrust which had taken place, still con- 
 tinued to exist in Philadelphia. The gentlemp from Marylard admits, ex 
 pressly, that the transmission of your public money for the payment of the ar- 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 439 
 
 my and navy must be effected through the agency of banks, but contends 
 that that object can be effected as well by the State banks as by a Bank of 
 the United States. My friend from Kentucky (Mr. POPE) said, that the great 
 characteristic difference between the present Government and that which ex- 
 isted under the old articles of confederation, is, that the present Government 
 has, within itself, the means of executing its own measures, without relying 
 upon the State Governments; whereas the old Congress had to rely upon the 
 States for the execution of the measures which it had previously devised and 
 adopted. 
 
 This opinion is substantially correct: for the constitutional dependence of 
 the present Government of the United States, upon those of the States, is 
 confined to its organization, and not to the execution of its constitutional 
 powers after it is organized. The gentleman from Tennessee (Mr. WHITE- 
 SIDES) has said, that we argue this question as though Congress was wholly 
 independent of the State Governments. When, sir, I had the honor of sub- 
 mitting rny reasons to the Senate, upon a former day, 1 expressly stated the 
 cases in which the National Government was dependent upon those of the 
 States, and proved, by referring to the constitution itself, that, in every case of 
 that kind, the constitution imposed upon the States the highest obligation to 
 perform the acts for which the Government of the United States was depen- 
 dent upon them. The constitution having defined the cases in which this 
 Government shall be dependent upon the State Governments, I did not hesi- 
 tate to declare it to be unwise and improvident to increase that dependence by 
 legislative acts, when we were unable to impose any obligation on the States 
 to perform the act. The same gentleman has said, that the objection to em- 
 ploy the State banks, was the result of a distrust in the State Governments, 
 rather than in the State banks: and that this distrust was unreasonable, be-' 
 cause the State Governments were composed of the same description of men 
 who composed the National Government. If this be called argument, and is 
 entitled to any weight, it is a two edged sword, which cuts both ways. It 
 equally proves the unreasonableness of the distrust which is felt against the 
 Government of the United States, in relation to the exercise of the right to 
 incorporate a bank. But, sir, to all this, the most satisfactory answer is, that 
 I will trust no man to do for me what I can do so much better for myself. 
 Why trust any man, when there is no necessity or reason for trusting him? 
 
 The gentleman from Maryland, in speaking of the means which have been 
 resorted to, to procure the renewal of the charter, says that we have not pro- 
 cured memorials to be presented to Congress, praying the charter might not 
 be renewed; ive have not procured pamphlets to be written, published, and 
 laid upon the tables of members, proving the unconstitutionality and inutility 
 of the bank; we have not imposed upon the credulity of honest mechanics 
 and manufacturers, and by that means procured delegations to be sent to pray 
 for the rejection of the bank memorial. Surely, sir, the gentleman did not, 
 by these declarations, mean to insinuate that any one of those gentlemen who 
 support the bill upon your table have had any agency in procuring any appli- 
 cation to be made injfavor of the bank. I know, that gentleman's respect for 
 himself; his respect for the Senate; his respect for the individual members of 
 this body, as well as his respect for the general rules of propriety, exclude the 
 possibility of his making such an insinuation. [Mr. SMITH explained, by 
 saying, I exclude every idea of such an insinuation.] Sir, 1 will tell the ho- 
 norable gentleman from Maryland, what has been done by those who are op- 
 posed to the renewal of the charter. 1 do not mean the members of the 
 Senate who are opposed to it, but those who have attempted to inflame public 
 opinion upon this question. Letters, sir, have been written from this place, 
 to induce the State Legislatures to instruct their members to oppose the re- 
 newal of the charter of the bank. I will ask the honorable gentleman from 
 Maryland, whether he does not know that letters have been written for that 
 purpose? 
 
 Ihe gentleman from Maryland has said, and I am extremely sorry that he 
 has, that the Bank of the United States had their agents in this city, for two 
 
440 BANK OF THE UNITED STATES. 
 
 sessions, intriguing with members of Congress to obtain a renewal of their 
 charter. 1 can assure that gentleman that I have had as little to do with the 
 agents of the bank as he has had. If, sir, I was disposed to retort upon those 
 who are opposed to the renewal of the charter, I would ask if they have not 
 seen published in the democratic papers of Pennsylvania, Maryland, and Vir- 
 ginia, extracts of letters said to be written in the city of Washington, charg- 
 ing the members of Congress, who are in favor of it, with bein^ bribed and 
 corrupted, and with being disposed to sell the sovereignty of the nation to 
 British capitalists? Have they not seen, in the same papers, conversations 
 detailed with great minuteness, which, it is pretended, have passed between 
 members of Congress, calculated to excite public odium and indignation 
 against the friends of the bill now under consideration? Sir, I will not, for a 
 moment, indulge an idea, that these letters have been written or these con- 
 versations detailed by any member of this body. The idea that such has 
 been the fact, is too humiliating, too degrading, not only to this honorable 
 body, but to human nature itselt, to be entertained but for one moment. And 
 yet, sir, the author of a charge, as base as it is false, against my honorable 
 friend from Kentucky, (Mr. POPE) has, day after day, occupied a seat in a 
 gallery of the Senate, to which no person has a right of access, but by an in- 
 troduction of one of the members of this body.* Sir, the highway robber, 
 when compared with the infamous fabricator of this base attempt to assassinate 
 the reputation of this honorable member, becomes a virtuous and estimable 
 character. Such, sir, has been the warfare which has been waged against the 
 renewal of the charter. Denunciations, and charges of political apostacy, are 
 the measures by which we have been assailed from without and from within. 
 Sir, I have shown that the bank question was no party question in its origin; 
 that it was a question upon which an honest difference of opinion always has 
 existed, and does now exist. And, shall I be charged with deserting the stan- 
 dard of the People, while I am treading in the foot steps of the great father 
 of his country? Shall I tremble at the charge of apostacy which has been 
 denounced against me by the gentleman from Tennessee, (Mr. WHITESDES) 
 while I am pursuing the course which has been approved by a Gerry, a Lang- 
 don, and a Washington men whom the wise and virtuous have delighted to 
 honor? No! While treading in the foot steps of these well tried patriots 
 and enlightened statesmen, I will advance with a firm, undeviating step, unap- 
 palled by the howling of party rage, more terrific than the yell of the abori- 
 ginal savage. 
 
 The gentleman from Maryland (Mr. SMITH) has said that he has under- 
 stood that a proposition was made in the Federal convention, to vest Congress 
 with power to create corporations generally, and without limitation. Had I 
 been a member of that convention, I should most certainly have voted against 
 the proposition, because it would have been unreasonable. Why should such 
 a power be delegated? Not certainly as necessary to execute the delegated 
 powers, because they are very limited. A general power to create corpora- 
 tions would have enabled Congress to have created them ad libitum, where 
 there was no possible relation between them and any one of the delegated 
 powers. The vote upon the bill incorporating the bank proves, that, if such a 
 proposition had been submitted, it must have been rejected, under a conviction 
 that the power to create corporations is incident to such of the general powers 
 as might require an act of incorporation completely to execute them, and 
 fairly vested by the constitution in Congress; because ten of the members of 
 that convention were in Congress, and voted for that bill; because General 
 Washington signed that bill; because the only member of that convention, 
 now in Congress, voted for the bill, and is now in favor of renewing the char- 
 ter; and because there were but eight members in that convention, in Con- 
 gress, who voted against it. 
 
 *Mr. C. did not intend to intimate that General Smith, of Maryland, introduced the 
 person alluded to, into that gallery, nor-does he believe that he did introduce him. 
 
ON THE BILL TO RENEW THE CHARTER OF 1T91. 
 
 Mr. President, I will now proceed to examine the objections which have 
 been offered to the construction which 1 have given to several clauses of the 
 constitution. In the observations which I made upon this part of the question, 
 when 1 was up before, I endeavored to prove that every construction which 
 had been given to this instrument, upon the idea of its being perfect, was like- 
 ly to be erroneous. The gentleman from Virginia, (Mr. G.) and the gentle- 
 wian from Tennessee, (Mr. W.) still view it as the model of perfection. 
 They are certainly at liberty still to entertain that opinion. Every man 
 has a right to erect his idol in this land of liberty, and to fall down and wor- 
 ship it, according to the dictates of his own conscience. I endeavored also 
 to prove, that, it we applied the same rule of construction to that clause of 
 the constitution from which we endeavor to derive the right to create a bank, 
 which has been applied to that from which the power to erect a light house 
 has been derived, the constitutional difficulty at once disappears. Until my 
 friend from Virginia, (Mr. G.) and my friend from Tennessee. (Mr. ANDER- 
 SON) had otherwise declared, I had always understood the right to erect light 
 houses had been exercised as incidental to the power to regulate commerce. 
 It seems, however, that I am mistaken, and that this right is incidental to 
 that clause whichgives Congress the right to exercise exclusive legislation in 
 certain places. Tne clause reads in the following words: 
 
 " To exercise exclusive legislation, in all cases whatsoever, over such district (not 
 exceeding- ten miles square) as may, by cession of particular States, and the accept- 
 ance of Congress, become the Seat of the Government of the United Statts, and to 
 exercise like authority over all places purchased by the consent of the Legislature of 
 the State in which the same shall be, for the erection of forts, magazines, arsenals, 
 dock yards, and other needful building's," 8cc. 
 
 Now, says my friend from Tennessee, this clause gives the right to erect 
 dock yards^ and, as dock yards must be on the sea coast, therefore, Congress 
 has the right to erect light houses, because they must also be on the sea coast. 
 This argument is extremely logical, nay, syllogistical, in form, but it is ex- 
 tremely illogical in substance. The conclusion drawn from the premises is 
 ^as necessary as though I were to say that, because two and two make four, 
 therefore five and five make twelve. The conclusion in the latter case is as 
 necessary as in the former. But my honorable friend from Virginia (Mr. G.) 
 derives it from the authority given in this clause, to erect other needful build- 
 ings. But the question recurs, needful for what? Why, certainly for the 
 purposes before specified. What are they? Forts, magazines, arsenals, and 
 dock yards. If tnis clause gives any authority to erect forts, magazines, arse - 
 nals, and dock yards, the other needful buildings spoken of must be needful 
 for these specified purposes. I should suppose that no man, who spends only 
 a few days in this city, can be at a loss to determine what is comprehended 
 tinder the term, " other needful buildings." Let him go to the clock, yard,, 
 nicknamed a navy yard, in this city, and he will there find a little town " of 
 other needful buildings," in the words of the constitution. But, sir-. 1 deny 
 that this clause of the constitution expressly gives any right, but that of exer- 
 cising exclusive legislation in the places to be accepted or purchased for the 
 purpjoses therein specified. The right to erect forts, magazines, and arsenals, 
 is fairly incidental to the right of declaring war, and of raising armies; and 
 the right to erect dock yards is fairly incidental to the right of providing and 
 maintaining a navy. But if, for the sake of argument, I should admit that the 
 right to erect forts, &c. is given in this clause, how can it be proved that the 
 right to erect a light house is also given? Forts, magazines, arsenals, and 
 dockyards, are enumerated; and, as the constitution says that all powers, 
 not expressly given, are retained, if the right to erect forts, magazines, &c. is 
 siven in this clause, most clearly the right to erect light houses is retained by 
 the States, because it is not to be found in the enumeration contained in the 
 clause. When 1 had the honor of addressing the Senate, before I questioned 
 the authority of the State Governments to create banks, I then stated, and I 
 again explicitly state, that it is with reluctance that I have felt it my duty to 
 56 
 
442 BANK OF THE UNITED STATES. 
 
 make any inquiry into the constitutional right of the State Governments t(? 
 incorporate banks. The State Legislatures ought to have recollected the 
 Spanish proverb, which says, that those who live in glass houses ought not to 
 throw stones. Before they undertook to question the constitutional authority of 
 Congress, they ought to have thoroughly examined the foundation upon which 
 their own right rested. The honorable gentleman from Virginia (Mr. GILES) 
 says, that the construction which I have given to that part of the constitution 
 which prohibits the States from emitting bills of credit, would apply equally 
 to promissory notes given by one individual to another, under the laws of a 
 State, as to a bank bill. Permit me to inquire of that gentleman, whether he 
 ever saw a law authorizing one man to give another his promissory note? He 
 may search the pandects 'of Justinian; he may turn over the leaves of the 
 musty volumes written upon the common law, from the days of Bracton and 
 Fleta, down to the present day, and his search will be in vain: for the right 
 to make contracts, the right to give promissory notes, is antecedent to, and 
 indepent of, all municipal law. The gentleman will find laws and decisions 
 in abundance, regulating the effect of endorsements, and other collateral cir- 
 cumstances, and prescribing the manner of enforcing the payment of promis- 
 sory notes, but he will never find a law giving the right to execute a promis- 
 sory note. But it is said that the bills of credit, which the States are prohi- 
 bited from emitting, must be bills of credit emitted on the credit of the State, 
 If this distinction should be well founded, many of the State banks are still 
 subject to the charge of unconstitutionally; because, in many of them, the 
 States are directly interested, and wherever that is the case, their bank bills 
 are bills of credit emitted on the credit of the State. But the correctness of 
 this distinction may well be denied, because the restriction is as general as it 
 could possibly be made. But it is said that this restriction applies only to 
 bills of credit which are made a legal tender in the payment of debts; that 
 bills of credit, designated in the constitution, are, ex vi termini, a legal ten- 
 der. For the correctness of this exposition, an appeal is made to the restric- 
 tion which immediately follows it, which restrains the right of the States to 
 make any thing but gold and silver a legal tender in the payment of debts. 
 It appear to me that the latter restriction excludes, most emphatically, the 
 construction contended for. If the States are prohibited from emitting bills 
 of credit, it would have been, to say the least of it, wholly nugatory to say 
 they should not make them a legal tender. If the bills are not emitted, it is 
 impossible that they can be made a legal tender. To suppose that the restric- 
 tion upon the right of the States to make any thing but gold or silver a legal 
 tender has any connexion with, or influence upon, the restriction to emit bills 
 of credit, is as absurd as to suppose that the decalogue, after having declared, 
 that " thou shalt do no murder," should have added, but, if you will mur- 
 der, you shall not rob and strike the dead. The construction of the re- 
 traint upon the right to make any thing but gold or silver a tender, is, that 
 they shall not make specific articles, as tobacco or cotton, a tender, as was 
 the case in some of the States. 
 
 But it is said that the history of the States will show that the bills of credit, 
 specified in the constitution, were those only which were a legal tender in 
 the payment of debts. Let us examine this point, according to the rule of 
 construction applied to another clause in the constitution by a large majority 
 of both Houses of Congress, during the present session. Another clause in 
 the constitution gives Congress the power to admit new States into the Union, 
 under two limitations. 1st. That no new State shall be formed within the 
 limits of any State, without the consent of the State; and 2d. That no new 
 State should be formed by the junction of two or more States, without^ the 
 consent of such States, and also of Congress. These limitations prove that 
 the formation of new States, within the limits of the United States, was in 
 the view of the convention at the time that this clause was adopted; and the sub- 
 sequent clause, which gives Congress the power to make rules for the govern- 
 ment of its territories, proves that these territories were, at that moment, 
 under consideration. In addition to these reasons, for believing that the 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 443 
 
 framers of the constitution had no idea of forming new States, beyond the 
 limits of the United States, those who were opposed to the admission of 
 Orleans as a State, contended that the history of the United States proves, 
 that the power to erect new States, and admit them into the Union, was 
 intended to be confined to new States within the limits of the United States 
 at the formation of the constitution, and that a different construction would 
 disparage the rights of the original States, and of course be a violation of the 
 constitution. What reply did the majority of Congress give to this train of 
 reasoning? They said that the right to admit new States cannot be subject toany 
 other limitations or restrictions than those which are contained in the clause 
 which gives the right: and as there is no restriction upon the right to erect 
 new States without the then limits of the United States, Congress have an 
 unlimited right to erect and admit them into the Union. Let us apply the 
 same rule ot construction to the restriction of the right of the States to emit 
 bills of credit. The restriction is a general one; it has no exceptions; and 
 every attempt to make exceptions ought to be repelled by the answer which 
 was given to those who opposed the right of Congress to admit the territory 
 of Orleans into the Union as a State. The construction I have contended 
 for, gains additional weight when we consider the restriction which imme- 
 diately precedes that under consideration. No State shall coin money, emit 
 bills of credit, &c. Bills of credit are but the representatives of money. The 
 constitution gives Congress the right to coin money, and to regulate its value. 
 It takes from the States the right to coin money, and to emit hills of credit. 
 Why give to Congress the tfght to coin money, and regulate its value? 
 Because the interest of the nation requires, that the current coin of the nation 
 should be uniform, both as to its species and value. If this is the true reason 
 why the right, of coining money, and fixing its value, was given to Congress, 
 does not the right to iue that which is to be the representative of this coin: 
 which in fact is to usurp its place: which is to be the real currency of the 
 nation, necessarily belong to Congress? Does not the right to create a bank, 
 which shall issue this representative of money, come within the same reason? 
 I think it does. 
 
 My friend from Kentucky (Mr. CLAY) contends that the right to create 
 a bank will prove destructive to the rights of the States, because, if Congress 
 can incorporate a bank, it may, under some pretext or other, create other cor- 
 porations, and authorize them to hold real and personal estate, which shall 
 be exempt from the right of taxation by the States. That, if this is admitted, 
 and he believes it generally is admitted, that the States cannot tax bank 
 stock, in this way the States may be deprived of the power of taxation. Sir, 
 I am one of those who do not admit the fact. [Mr. CLAY said that he did riot 
 admit it neither, though he had understood the bank held that doctrine. J I 
 am extremely glad we think alike, at least, upon this collateral point. The 
 right of the States to impose taxes is unlimited by the constitution of the 
 United States; they, therefore, can tax every species of property, which is 
 within their legislative jurisdiction. The unlimited power of the States to 
 impose taxes is, in all probability, the true cause of giving to Congress the 
 power of exclusive legislation over all places which should be selected for the 
 erection of forts, magazines, arsenals, and dock yards, because public property, 
 to a great amount, would necessarily be collected in these places, and but for 
 vesting the right of legislation in Congress to the exclusion of the States, all 
 this property would have been subject to taxation, which would have produced 
 great embarrassment. It has been said, not indeed upon this floor, but by 
 men for whose opinions I entertain a very high respect, that the right of the 
 States to tax bank stock is inconsistent with the right of Congress to create 
 a bank. That the right of taxation destroys the right to create, because the 
 States, by immoderate taxation, could drive the bank out of their limits. All 
 arguments drawn from the abuse of a right ought to be received with great 
 caution; but if it is entitled to any weight in this case, it equally proves the 
 unconstitutionally of the State banks, because the right of Congress to lay 
 and collect taxes is subject to but two restrictions: that they shall be uniform, 
 
444 BANK OF THE UNITED STATES, 
 
 and that direct taxes shall be according to representation. Suppose Congress 
 was under a necessity of raising $10,000,000 by direct tax, the whole or nearly 
 the whole of this sum might be imposed upon bank stock ? and by that means 
 the State banks totally destroyed. The advocates of this doctrine are also 
 advocates for State banks. If the right of taxation by the States] proves the 
 unconstitutionality of the Bank of me United States, the right of Congress 
 to tax, equally proves the unconstitutionality of the State banks. 
 
 To the fervid imagination of my friend from Kentucky, (Mr. CLAY) this 
 power to create a bank appears to be more terrific than was the lever of 
 Archimedes to the frightened imaginations of the Romans, when they beheld 
 their galleys suddenly lifted up, and whirled about in the air, arid in a moment 
 plunged into the bosom of the ocean. Are these apprehensions founded in 
 reason ? or are thev the chinieras of a fervid and perturbed imagination? What 
 limitation does the constitution contain upon the power to lay and collect 
 taxes, imposts, duties, and excises? None but that they shall be uniform; 
 which is no limitation of the amount which they can lay and collect. What 
 limitation does it contain upon the power to raise and support armies? None 
 other than that appropriations shall not be made for a longer term than two- 
 years. What restriction is to be found in it, upon the right to provide and 
 maintain a navy? None. What upon the right to declare war, and make 
 peace? None; none. Thus the constitution gives to the Government of the 
 United States unlimited power over your purse?; unlimited power to raise 
 armies and provide navies; unlimited power to make war and peace; and you 
 are alarmed, you are terrified at the power to create a bank to aid it in the 
 management of its fiscal operations. Sir, nothing short of my most profound 
 respect for honorable gentlemen, who have frightened themselves with this 
 bugbear, could induce me to treat the subject seriously. Gentlemen have 
 said, that they are alarmed at the exercise of this power, and I am bound to 
 believe them. Sir, after giving Congress the right to make war and peace; 
 the right to impose taxes, impost, duties, arid excises, ad libitum; the right to 
 raise and support armies, without restriction as to number or term of service; 
 the right to provide and maintain a navy without limitation; I cannot bring 
 myself to tremble at the exercise of a power incidental to only one of these 
 tremendous grants of power. The gentleman from Kentucky (Mr. CLAY) 
 contends, that we have attempted to give a degree of weight and force to 
 what we are pleased to call precedents, to which they would not be entitled 
 in those tribunals from which we derive all of our ideas of precedents. I am 
 happy to find that my friend from Virginia (Mr. G.) agrees with me in opinion 
 upon this subject. Indeed, the principal difference between that gentleman 
 and myself is confined to the question of expedience. He thinks that the 
 construction which has been given to the constitution ought to be considered 
 as conclusive; and that great incovenience will be produced by unsettling 
 what ought to be considered as finally settled and adjudged. 
 
 I agree, also, with the gentleman from Kentucky, that a precedent, to have 
 weight, must be in point; that the issue upon which the decision is made must 
 be the same as that in which it is adduced as authority. To this, I most 
 heartily agree, and will rely upon it to show that the cases which we urged 
 as precedents are entitled to the greatest weight. In all cases between indi- 
 viduals, they are supposed to understand their own interests, and their own 
 cases. The plaintiff is supposed to understand the point upon which the de- 
 cision of his case must depend. The defendant is supposed to understand 
 the ground of his defence. They make up an issue, either of fact or of law. 
 It is this issue which is to be tried. Any declaration or expression of the 
 judge, which is not confined to the issue, is of course entitled to no weight. 
 Well, sir, what is the nature of the precedents upon which we rely? First, 
 that a republican Congress, in the year 1804, passed a law extending the 
 operations of this unconstitutional institution, as they contend, into territo- 
 ries, to which they had no right to extend them by their charter. In the year 
 1807, they pass a law punishing the forging of their bills. Now, sir, my 
 friend from Tennessee (Mr. ANDERSON) says that those who passed the bank 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 445 
 
 bill were afraid to venture that far they were afraid to pass a law to punish 
 the conterfeiting of their bills; but, in the year 1798, in the plenitude of fede- 
 ral domination, they passed a law to punish counterfeiting the bills of the 
 bank. It is certainly true, that the federal party did pass this bill in that year; 
 but it is equally true, that the republican party, in the plenitude of their power, 
 did pass a bill of the same kind in the year 1807. Well, sir, what is the is- 
 sue which is tendered in the passage of every bill by the Congress of the 
 United States? First, That the constitution gives them the right to pass the 
 bill; and second, That it is expedient. The first, sir, is the most important 
 issue, made up between the National Legislature and the People of the United 
 States, in passing bills by which their rights are to be protected or violated. 
 How, then, are we told that these laws passed sub sikntio? That the consti- 
 tutional right of Congress to pass such a law never was discussed, or even 
 thought ofF Sir, suppose the gentleman from Kentucky had constituted me 
 his attorney to do a particular act for him, and I had performed an act, under 
 that power, which had no connexion with the one which he had authorized me 
 to perform, and when charged with this violation of my trust, I should gravely 
 
 say, really I never examined the power, but took it for granted that I had the 
 
 right that in fact I had done it sub sikntio what would my friend from 
 Kentucky say to such a reply? But, suppose I had taken an oath to discharge 
 the trust with fidelity and skill, and that I would, in all things touching |the 
 trust, confine myselt to the power delegated to me. Suppose, I say, under 
 these circumstances, I should violate this trust should transcend the autho- 
 rity given, and perform an act clearly not delegated? What would the gen- 
 tleman say to me, when I gravely told him that I had not particularly exam- 
 ined the authority under which 1 had actedthat I had done it sub sikntioP 
 Sir, this way of disposing of these formal voluntary acts of the Government, 
 sanctioning the legality and constitutionality of the bank charter, will not be 
 accepted. Some more happy expedient must be devised. But, sir, we are 
 told that, because the constitution contains within itself the principles of 
 amendment, that if any doubts existed on this subject, it ought to have been 
 amended. Whenever the States have conceived their rights to have been 
 affected by any construction which has been given to the constitution, they 
 have shown that they know how to obtain relief. When the Supreme Court 
 of the United States undertook to support the doctrine that an individual 
 could sue a State, they did not hesitate to interfere, and the constitution was 
 amended. When an embargo was laid, in the year 1807, those States who 
 were most inimical to that measure did not hesitate to offer an amendment to 
 the constitution. Whenever a construction is given to the constitution by a 
 legitimate and competent authority, those who are opposed to that construc- 
 tion ought to propose amendments, and not those who are satisfied with it. If 
 the construction given to the constitution, by the creation of the bank, was 
 thought by the republican party to be vicious, then, indeed, have they been 
 guilty of the grossest act of negligence. It was in their power, and most as- 
 suredly it was their duty, to have amended the constitution, either by express- 
 ly giving or taking away the power. It was their duty to have settled the 
 question forever. Suppose, sir, you now decide that it is unconstitutional for 
 Congress to incorporate a bank; this will not settle the constitutional ques- 
 tion. It will unsettle and render uncertain what has been settled for twenty 
 years. You say you have not the right to incorporate a bank. Ten years 
 hence other men come into power, ana say they have the right, and exercise 
 that right for twenty years. The bank, then, will have been constitutional for 
 twenty years, unconstitutional for ten years, and constitutional for twenty 
 more. Are we to go on in this unsettled, miserable, halting manner? God 
 iorbid. 
 
 Sir, I have closed the observations which I thought it my duty to 
 make, in reply to the comments which have been made upon trie remarks 
 which I had previously submitted to the consideration of this honorable body. 
 If, sir, I preferred my political standing in the State which I have the honor to 
 represent (and, sir, I do not profess to have any out of it) to the public vvel- 
 
446 BANK OF THE UNITED STATES. 
 
 fare, I should rejoice at the success of the motion which has been made by the 
 honorable gentleman from Tennessee, (Mr. ANDERSON.) But, sir, as 1 be- 
 lieve the public welfare infinitely more important than any fleeting popularity 
 which an individual like myself can expect to enjoy, I shall most sincerely 
 regret the success of that motion. Sir, I have said but little about the degree 
 of distress which will flow from the dissolution of the bank, because I have 
 not that kind of evidence which would enable me to judge of it with any de- 
 gree of accuracy. The convulsed state, of the European nations the im- 
 mense losses which our commerce, has sustained by the operation of the de- 
 crees and orders of the tyrants of the land and the ocean, imperiously admo- 
 nish us to beware of making untried and dangerous experiments. By sup- 
 porting this institution, the tottering credit of the commercial class of your 
 citizens may be upheld, until the storm shall have passed over. By overturn- 
 ing this great moneyed institution, at the present crisis, you may draw down 
 to undistinguished ruin thousands of your unfortunate and unoffending fellow- 
 citizens. 
 
 The question was then taken on the motion to strike out, and was decided 
 as follows: Yeas 17, Nays 17. 
 
 Those who voted in the affirmative, were, 
 
 Messrs. Anderson, Campbell, Clay, Cutts, Franklin, Gaillard, German, Giles, 
 Gregg, Lambert, Leib, Mathewson, Reed, Robinson, Smith, of Maryland, Whiteside, 
 and Worthington. 
 
 Those who voted in the negative, are, 
 
 Messrs. Bayard, Bradley, Brent, Champlin, Condict, Crawford, Dana, Gilman, 
 Goodrich, Horsey, Lloyd, "Pickering-, Pope. Smith, of New York, Tait, Taylor, and 
 Turner. 
 
 The Senate being equally divided, the President (GEORGE CLINTON) de- 
 termined the question in the affirmative, first submitting to the Senate the 
 following prefatory remarks: 
 
 GENTLEMEN: As the subject on which I am called upon to decide, has ex- 
 cited great sensibility, I must solicit the indulgence of the Senate whilst I 
 briefly state the reasons which influence my judgment. 
 
 Permit me to observe, that the question to be decided does not depend sim- 
 ply upon the right of Congress to establish, under any modification, a bank, but 
 upon their power to establish a national bank, as contemplated by this bill. In 
 other words, can they create a body politic and corporate, not constituting a 
 part of the Government, nor otherwise responsible to it but by forfeiture of 
 charter, and bestow on its members privileges, immunities, and exemptions, 
 not recognised by the laws of the States nor enjoyed by the citizens gene- 
 rally? 
 
 It cannot be doubted that Congress may pass all necessary and proper laws 
 for carrying into execution the powers specifically granted to the Government 
 or to any department or officer thereof; but, in doing so, the means must be 
 suited and subordinate to the end. The power to create corporations is not 
 expressly granted; it is a high attribute ot sovereignty, and in its nature not 
 accessorial or derivative by implication, but primary and independent. 
 
 I cannot believe that this interpretation of the constitution will, in any de- 
 gree, defeat the purposes for which it was formed; on the contrary, it does ap- 
 pear to me that the opposite exposition has an inevitable tendency to conso- 
 lidation, and affords just and serious cause of alarm. 
 
 In the course of a long life, I have found that Government is not to be 
 strengthened by an assumption of doubtful powers; but by a wise and ener- 
 getic execution of those which are incontestible; the former never fails to 
 produce suspicion and distrust, whilst the latter inspires respect and con 
 fidence. 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 447 
 
 If, however, after a fair experiment, the powers vested in the Government 
 shall be found incompetent to the attainment of the objects for which it was 
 instituted, the constitution happily furnishes the mean for remedying the evil 
 by amendment, and I have no doubt that, in such event, on an appeal to the 
 patriotism and good sense of the community, it will be wisely applied. 
 
 I will not trespass upon the patience of the Senate any longer than to say, 
 from the best examination I have been able to give the subject, I am constrain- 
 ed, by a sense of duty, to decide in the affirmative; that is, that the first section 
 of the bill be stricken out. 
 
 FEBRUARY 21, 1811. 
 
 On motion of Mr. LEIB, 
 
 Ordered, That the further consideration of this bill be postponed to the 
 1st Monday in December next. 
 
 FEBRUARY 22, 1811. 
 
 Mr. SMITH, of Maryland, asked and obtained leave to bring in a bill to 
 repeal the 10th section of the act, entitled " An act to incorporate the sub- 
 scribers to the Bank of the United States;" which bill, on the 3d of March, 
 on motion of Mr. SMITH, was postponed to the 1st Monday in December 
 next. 
 
 The said 10th section is as follows: 
 
 "SEC. 10. The said corporation may sell any part of the public debt, 
 whereof its stock shall be composed, but shall not be at liberty to purchase 
 any public debt whatsoever: nor shall, directly or indirectly, deal or trade in 
 any thing, except bills of exchange, gold or silver bullion, or in the sale of 
 goods really and truly pledged tor money lent, and not redeemed in due 
 time; or of goods which shall be the produce of its lands. Neither shall the 
 said corporation take more than at tne rate of six per centum per annum for 
 or upon its loans or discounts." 
 
 This bill eventually became a law, and was approved by the President on 
 the 19th March, 
 
 PROCEEDINGS AFTER THE REJECTION OF THE BILL. 
 
 After the final rejection of the bill to renevy the charter, the bank applied 
 for a temporary continuation of their powers, for the purpose of enabling them 
 to close up their affairs. It is believed that two years was the time solicited. 
 The memorial of the bank was presented simultaneously in the House and in 
 the Senate, but appears not to have been favorably received in either. The 
 following are the proceedings which took place, and the reports that were 
 made on this subject, in the two Houses. 
 
 IN SENATE. 
 
 FEBRUARY 25, 1811. 
 
 Mr. LEIB presented the memorial of the Stockholders of the Bank of the 
 United States, praying an extension of their charter so far as to enable them 
 to settle the accounts of the bank, for reasons therein stated. The memorial 
 was read, and, on motion of Mr. LEIB, 
 
 Resolved, That it be referred to a select committee, to consist of five mem- 
 bers, to consider and report thereon. 
 
 Ordered^ That Messrs. Clay, Franklin, Leib, Anderson, and Bayard, be 
 the committee. 
 
4 
 
 I 
 
 448 BANK OF THE UNITED STATES. 
 
 MARCH 2, 1811. 
 Mr. CLAY, from the said committee, made the following report: 
 
 That your committee have duly weighed the contents of the memorial, and 
 deliberately attended to such explanations of the views of the memorialists as 
 they have thought proper to present, through their agents: That, holding the 
 opinion, (as a majority of the committee do,) that the constitution did not autho- 
 rize Congress, originally, to grant the charter, it follows, as a necessary conse- 
 quence ot that opinion, that an extension of it, even under the restrictions 
 contemplated by the stockholders, is equally repugnant to the constitution. 
 But, if it were possible to surmount this fundamental objection, and if that 
 rule which forbids, during the same session of the Senate, the re-agitation of 
 a proposition once decided, were disregarded, your committee would still be 
 at a loss to find any sufficient reasons tor prolonging the political existence of 
 the corporation, for the purpose of winding up its affairs: for, 
 
 As it respects the body itself, it is believed that the existing laws, through 
 the instrumentality of a trust, properly constituted, afford as ample means as 
 a qualified continuance of the charter would, for the liquidation of its accounts, 
 and the collection and final distribution of its funds. But, should any incon- 
 venience be experienced on this subject, the committee are persuaded it will 
 be very partial, and such as the State authorities, upon proper application, 
 would not fail to provide a competent remedy for. And, 
 
 In relation to me community, if the corporation, stripped of its banking 
 powers, were to fulfil, bona fide, the duty of closing its affairs, your commit- 
 tee cannot see that any material advantage would be derived. Whilst, on 
 the contrary, if it should not so act, but snould avail itself of the temporary 
 prolongation, in order to effect a more durable extension of its charter, it 
 might, in its operations, become a serious scourge. 
 
 Your committee are happy to say, that they learn, from a satisfactory 
 source, that the apprehensions which were indulged, as to the distress result- 
 ing from anon -renewal of the charter, are far from being realised in Philadel- 
 phia, to which their information has been confined. It was, tong since, ob- 
 vious, that the vacuum in the circulation of the country, which was to be 
 produced by the withdrawal of the paper of the Bank of the United States, 
 would be filled by paper issuing from other banks. This operation is now 
 actually going on 5 the paper of the Bank of the United States is rapidly re- 
 turning, and that of other banks is taking its place. The ability to enlarge 
 their accommodations is proportionately enhanced; and when it shall be fur- 
 ther increased by a removal into their vaults of those deposites which are in the 
 possession of the Bank of the United States, the injurious effects of a dissolu- 
 tion of the corporation will be found to consist in an accelerated disclosure of 
 the actual condition of those who have been supported by the credit of others, 
 but whose insolvent or tottering situation, known to the bank, has been con- 
 cealed from the public at large. 
 
 Your committee beg leave to present the following resolution: 
 
 Resolved, That the prayer of the memorialists ought not to be granted. 
 
ON THE BILL TO RENEW THE CHAUTER OK 1791. 449 
 
 HOUSE OF REPRESENTATIVES. 
 
 A like memorial was, also, on the same day, presented to the House, and 
 ordered to be referred to a select committee, to consist of Mr. P. B. Porter, 
 Mr. Eppes, Mr. Macon, Mr. Davenport, Mr. Wilson, Mr. Shaw, Mr. 
 Whitehill, Mr. Desha, and Mr. Ringgold. / 
 
 MARCUS, 1811. 
 Mr. P. B. PORTER, IVojji the said comm^tee, made the following report: 
 
 The committee, to whom was referred the memorial of the Stockholders of 
 the Bank of the United States, report:" 
 
 That they have carefully examined the various matters set forth in the said 
 memorial, and attentively listened to the representations of the gentlemen 
 who have appeared in behalf of the said petitioners. The object of the memo- 
 rialists is to obtain an extension ot their corporate powers, beyond the period 
 limited for the expiration of their charter, so as to enable them to prosecute 
 for their debts, and to arrange, liquidate, and close, the various concerns of 
 the company. 
 
 The committee are of opinion that a law of Congress, granting the powers 
 prayed for, would facilitate the final adjustment of the affairs of the bank, 
 although they do not think such a law indispensable to that object. But, be- 
 lieving, as your committee do, that, in granting the original charter to the 
 stockholders, Congress transcended the legitimate powers of the constitu- 
 tion, the same objection now presents itself to the extension of any of their 
 corporate capacities. 
 
 If the committee had time to go into the investigation] and to present to 
 the House the various reasons which have conduced to this opinion, it would 
 be more than useless to divert its attention from the important concerns of 
 the nation, at this late period of the session/to a subject, which, but a few 
 Hays since, was so fully and elaborately discussed. 
 
 They, therefore, beg leave to recommend the following resolution: 
 
 Resolved, That the prayer of the memorialists ought not to be granted. 
 
 DEBATE IN THE HOUSE OF REPRESENTATIVES, IN 1810, 
 
 On the reference of the Memorial of the Stockholders, and on the Sill 
 reported by Mr. Taylor, of South Carolina.* 
 
 HOUSE OF REPRESENTATIVES, March 29, 1810. 
 
 Mr. TAYLOR said it would be recollected that several projects on the subject 
 of the Bank of the United States had been offered during the present session; 
 some to this House and one to the Senate, in the form of a bdl now laid on 
 the tables of members. Some days ago, said Mr. T. one of the plans for con- 
 stituting or raising a Bank of the United States, which had been committed 
 to a committee of the whole House, was, by the original proposer, removed 
 from the committee of the whole House, and referred to a select committee. 
 
 * The reader is requested to excuse the omission of this debate in its proper 
 place: it should have appeared at pages 122 and 134 ante. By reference to those 
 pages, it will be seen that, on the 13th of April, 1810, the House went into a Com- 
 mittee of the Whole on the bill, and, on rising, were refused permission to sit again. 
 This debate took place in Committee of the Whole. 
 57 
 
450 BANK OF THE UNITED STATES. 
 
 He said lie believed it all important to the nation, that the project which 
 should be most advantageous should be presented to the decision of the House, 
 Other projects were now, perhaps, in a train for being offered in detail; and 
 it would probably be found that the renewal of the charter of the Bank of the 
 United States would be the most advantageous course. He would not now 
 express an opinion one way or the other, but rose for the purpose of advocating 
 fair play, by giving the House a choice of plans. With that view, and to give 
 all the proposed plans an equal chance, he moved that the committee of the 
 whole should be discharged from the further consideration of the report of 
 the committee on the memorial of the stockholders of the Bank of the united 
 States, and refer it to a select committee, with a view to report a bill. 
 
 The question on discharging the committee of the whole from the report, 
 was carried without a division. 
 
 On the question of referring the report to a select committee, 
 
 Mr. LOVE said he should support the motion, because he felt convinced 
 the House would, with difficulty ,f ever, come to a decision on apian, if the 
 discussion commenced on a resolution, and was afterwards to be repeated on 
 a bill. 
 
 Mr. BASSETT was opposed to the reference. He thought the House ought 
 to try the question on principle, before they entered into any details. 
 
 Mr. TAYLOR said, his only object was fair play. The Senate would, with 
 their bill, anticipate the House; and though their plan might not be deemed 
 the best, the regular troops had, before now, defeated the militia, and might 
 again. He only asked the same indulgence as had been accorded to the pro- 
 position of the gentleman from Virginia (Mr. LOVE) a few days ago. 
 
 Mr. GHOLSON thought this reference would operate as a delay: for, if a dis- 
 cussion on any bill on the subject of a bank was pressed, the House would be 
 told, the subject was yet before a committee, and that they ought to wait for 
 its report. 
 
 Mr. QUINCY spoke in favor of a commitment. 
 
 Mr. LOVE said he had moved the reference of his proposition to a select 
 committee, because he believed it would be practicable to report a bill which 
 would not conflict with any constitutional provision. He did not agree, how- 
 ever, that the proposition to commit this r was precisely of a similar nature 
 with that which was agreed to in relation to his. The difference was in this, 
 that, in the present case, a constitutional difficulty occurred on the face of the 
 proposition, and which would be decided without seeing the details of a bill, 
 while the same objection could not apply to a general proposition for a national 
 bank: for, till its features were presented in detail, the objections to it could 
 not be known. 
 
 Mr. PITKIN was for commitment. He wished to see the conditions on 
 which the charter was to be continued. He did not say what all the eondi- 
 tions should be, but one must be, in his opinion, that the individuals should 
 pay a handsome sum into the public treasury; that the United States should 
 have the benefit of the renewal, and that it should not be put into the pockets 
 of individuals. His vote might be governed by the sum to be given, and 
 therefore he wished to see the plan in detail. 
 
 . Mr. DANA said, lie had rather that the whole question, as respected both 
 propositions, should have been agitated in committee ot the Whole. It those 
 whose business it was to administer the affairs of the Government, said that 
 the business of the Government could be conducted without a bank, and that 
 they would undertake to do without it, Mr. D. said, he was willing to let the 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 whole go. He thought there was an incongruity in having the subject of 
 banks referred to two distinct committees, as they would probably be con- 
 tinually carrying on war on the frontiers of each other's territories. 
 
 Mr. GOLD expatiated on the inconveniences that would result from a double 
 discussion, first on a resolution and then on a bill. He did not conceive, with 
 Mr. LOVE, that the question would be on a simple renewal of the present 
 charter of the Bank of the United States, but that an extensive revision and 
 modification of the former system was contemplated. It was indispensable 
 that the subject should be presented as much in detail as possible. The House 
 would not at all commit itself by voting for this motion. 
 
 Mr. MACON said it was but fair to give both projects the same course. He 
 had no fear of collision between the two committees. He recollected, indeed, 
 once a contest between the military and naval committees, to which of the two 
 the gun boats belonged; but the same subject was often before two different 
 committees, without producing difficulties; as, for instance, the two convoy 
 bills were reported, during this session, by different committees. It was pre- 
 fectly fair, he thought, to refer to one committee, the question whether the 
 charter of the Bank of the United States should be renewed, and to another, 
 the question whether a bank should be established on a plan altogether new. 
 
 The motion for reference to a select committee was carried. 
 
 \)>KIL 13, 1810. 
 
 In committee of the whole House, Mr. LOVE, of Virginia, moved to strike 
 out the first section of the bill. 
 
 ^ On this motion a debate arose, in which Mr. LOVE, Mr. TAYLOR, and Mr. 
 FINDLEY, participated. Their speeches are given as follows: 
 
 Mr. LOVE. He lamented that he was compelled to come to a decision on 
 the question without having obtained the information he had solicited a few 
 days before; and assured the committee he had not called for information, as 
 to the names of the stockholders, from any view to weaken the support the mea- 
 sure proposed would have, from a disclosure of the names of tnose members 
 who were stockholders in the Bank of the United Statesmen the contrary, he 
 would not for a moment doubt, that all such would voluntarily and from choice 
 decline voting on the question, not only from their sense of propriety, but 
 trom a knowledge of the imperative rule of the House, which forbids a mem- 
 ber from voting where his interest is concerned. He could not fear that any 
 gentleman of that House would do an act to which might be attributed so im- 
 proper a motive as that of advancing his particular property fifty per cent, 
 in value, and making his share of bank stock, now worth 400 dollars, by his own 
 vote, worth 600, or perhaps much more. But his principal ground for the gene- 
 ral call of the names of the stockholders was to check the statement of foreign, 
 by exhibiting the domestic stockholders. Mr. L. next adverted to the infor- 
 mation which had been given to the Senate by the Secretary of the Treasury, 
 in reply to an inquiry made relative to the capital distributed to the branches, 
 and the dividends stated to be yielded by them; he said there was certainly a 
 most gross misrepresentation in the statements of that report, relative to the 
 profits divided at the principal bank in Philadelphia. 
 
 The portion of the capital assigned to the branches was stated in the report 
 at 5.300,000 dollars; and those branches had discounted, by the last returns, 
 to the amount of 11,964,000 dollars, yielding a gross profit of more than thir- 
 teen per cent. The capital retained in Philadelphia was to the. amount of 
 4,700,000 dollars, granting, by the report, discounts to the amount of $4,572,000 
 only. He 'remarked on the improbability of the correctness of the latter 
 part of the report, because he said it was well known that bank capital had 
 been used as profitably in Philadelphia as in any other town, and the State 
 banks, unaided by the depesites ofthe Government ol the United States, had 
 
4f)'-J TtAXK OF TIIK UNITED STATES. 
 
 yielded so great a dividend as to make the stock of those banks worth from 
 35 to 50 per cent, which he adverted to in detail: and deduced from that circum- 
 stance the impossibility of the truth of the information on which the report was 
 grounded. He therefore thought it at least fair to state the profits of the princi- 
 pal bank at the same which he believed the branch banks had honestly reported 
 of themselves: and it will be found that, after the deduction for losses (that 
 probably never happened) and contingencies never expected to take place, it 
 would yield a nett dividend on the institution of more than 11 per cent, pel- 
 annum, instead of 8ths, as had been reported by the Secretary of the Treasury, 
 on the statements of the officers of the bank. 
 
 Mr. L. said he would advert to other instances of attempts to deceive the 
 Legislature of the United States, discovered in the memorial of the stockhold- 
 ers of the bank or their agents. They had stated themselves entitled to an 
 honorable claim on the patronage of the Government, for several reasons: 
 first, in having enriched the treasury, by the share the Government subscrib- 
 ed to the stock. In answer to this Mr. L. said, the Government composed 
 originally a part of the company; that it had the right, like other stockholders, 
 to sell out; it would have been hard to deprive it of that right, as it had no 
 voice in the direction, as other stockholders had: but, as it was a part of the 
 original plan, no party to it had a ridit to complain. As well might the Unit- 
 ed States claim from individual stockholders a part of their profits when they 
 may have sold their stock; but admitting Government made 650,000 dollars, 
 as we are told, by its stock, and that the other stockholders may charge this 
 item fairly, the Government can certainly oft-set it, by showing that the in- 
 dividual stockholders who held the six per cent, debt, as a part of the bank 
 capital, have also sold at an advance, and out of the public made their sales at 
 least to this amount. 
 
 Another honorable claim is said to be in having loaned Government great 
 sums of money. Mr. L. said it might be true, and it was also true that they 
 had received G per cent, for the loan, although a great part of the money loan- 
 ed was actually borrowed by the bank, in Holland, at a rate of interest pro- 
 bably less than 4 per cent. This item of honorable claim, then, consisted of 
 making about 2 per cent, clear money out of the Government: if this loan 
 formed an honorable claim to the management of our money matters, France 
 and Holland, it was certain, had much more honorable claims, as they loaned 
 us money when our distresses were much greater, without a pledge of antici- 
 pated revenue for reimbursement, as this bank has had. But the truth was, 
 that any bank could, if it chose, loan to Government for much less than to 
 individuals, because, in case of a press for money, the debt due from the Go- 
 vernment would always command specie in the market, either by pledges or 
 otherwise; a bank could, therefore, discount to individuals on the credit of 
 the very debt which was due them by Government, at all times, to the a- 
 mount of one half of it, and would, therefore, lose nothing by loaning to the 
 United States at three per cent. 
 
 Next, it was said, the bank had enabled the Government to collect its re- 
 venue/ Mr. L. ridiculed this idea, and said, that the State banks would, very 
 thankfully, take this trouble, as well as many others the United States com- 
 plained of as very onerous. But, last of all, the idea of the branch banks 
 having been a charge to the institution, is least capable of being supported, 
 after the report to the Senate of the 3d instant, by which, it seems those banks 
 have averaged a dividend of more than thirteen per cent., while the principal 
 bank had not given six per cent, according to their own account. He said. 
 he had mentioned those things only because they looked like an attempt to 
 impose on a Legislature they might presume to be ignorant of its rights. 
 
 Mr. L. then said, he would consider the question of continuing the United 
 States' Bank company's charter on two grounds, principally. 
 
 First* As to the neceasity which existed for such a measure. 
 
 Secondly, As to the policy, if no real necessity existed. 
 
 And, as to the first, he said, it was easy to prove that, as it respected the 
 interests of the community at large, there was no necessity for it; but. that a 
 
ON THE BILL TO RENEW THK CHARTER OF 1791. 453 
 
 benefit would result from its immediate dissolution. From the report of the 
 Secretary of the Treasury it appeared they had $5,000,000 of specie in their 
 vaults dead and taken out of circulation; for which, they had, according to 
 the report given us, a circulation in bank notes to the amount of 4,500,000 dol- 
 The public, then, lost a circulation of 500.000 dollars, besides exchange 
 of specie for paper 500,000 dollars lay dead and buried in the vaults of this 
 bank ! 
 
 The public, it is said, are under the necessity to renew this charter, be- 
 cause the amount of stock held by foreigners would immediately be sent to 
 them in specie. Mr. L. controverted the correctness of this position, and 
 said it was contrary to the known Mite of facts) that foreigners would not 
 withdraw a capital from this country when they could get six percent, in our 
 public debt for it, in order to carry it home and get three or four per cent, 
 which was the most to be got in Europe; they would not, because tnev could 
 no longer get double as much as in Europe, refuse to take half as much more; 
 and this they might do bv buying the public debt, which was to be had at two 
 per cent, above par; and their holding that would produce no danger of their 
 exercising an influence in our commercial towns, but, on the contrary, asafe- 
 - they would have a stake in the stability of our Government, without the 
 power of managing our revenues. 
 
 But, for argument sake, he would admit, that foreigners might be guilty 
 of the folly of losing so much, becau.se they could . a great deal more, 
 
 and endeavor to .show that, if they did, contrary to a sense of their own in- 
 interests, withdraw this capital, it would produce infinitely less evil to 
 mntry than t<, continue their charter, even with its present capital. 
 $7,300,000 of the whole capital belo- : $2,300,000 ot the 
 
 whole capital consisted of the public debt of 6 per cent. Deduct this sum. 
 say only one fifth, would Iea\< 'led for, in specie, to the whole number 
 
 of stockholders, eight millions of dollars. Three-fourths ftf this, or $6,000,000, 
 belongs to foreigners; five millions of the whole capital they already have; 
 it lies in their vaults, dead. They could only wind up with an additional 
 three millions of specie. Three fourths ofihU three millions foreigners might 
 withdraw, which is now in use in this country, to wit: the sum of 82.250,000; 
 it was all the community could feel the lo-"s .f. But continue the bank, 
 and. according to the principles shown, relative to actual nett dividends, 
 foreigners now get from us about $1,000,000 per annum, and according to the 
 rate of dividend admitted by the Secretary of the T foreigners get 
 
 from us eight and three-eighths percent, on three-fourths, or nearly, of ten 
 millions, equal, at least, to the sum of about $630,000 per annum; by 
 which, in less than four years, a larger amount in specie would be remitted in 
 interest, than the specie capital now to be lost: for the stockholders in Europe 
 live upon the interest. As soon as the dividend is declared, it draw- no more, 
 and is remitted. 
 
 Mr. L. said there never was a time when this country could spare; in- 
 specie, if it was to be taken away, better than the present, and he hoped there- 
 would be a time: for it was a known fact, that the orders of the belliger- 
 - > narrowed commercial pursuits, that a very small sum was employ- 
 ed in that way. and immen-e quantities of specie were now in the country; as 
 a proof of it he referred the gentleman from South Carolina to his own Sta 
 which a bank had lately been established, and in a lew hours greatly over sub- 
 scribed. .So. tM>. in Baltimore, where several had been established, and in 
 other mercantile towns of the United In addition to these f< 
 
 the report from the mint informed us that, in the last year, near a million had 
 been coined, and bullion remained on hand, more than they could work up. 
 Another circumstance, worthy of notice, to prove that our situation was 
 and that the little trade we had did yield a balance in our favor, our mer' 
 chants are not in want of remittances; bills of exchange on London ai 
 eral per cent, below par. 
 
 Mr. L. next adverted to the evils which were said to be likely to arise to in- 
 dividuals from the dissolution of the charter, and contended that the} w-re 
 
454 BANK OF THE UNITED STATES. 
 
 not real; that much had been said, in and out of doors, to excite alarm on this 
 subject. To prove them not real, take, said Mr. L. the discounts at any one 
 of the branches, or the mother bank. At Boston, for instance, the loans were 
 to the amount of about 1,000,000 on a capital of about 700,000 dollars. The 
 agent of the bank has voluntarily stated (being admitted at his own request 
 before a'committee) that the discounts of the bank were to the amount of three 
 fourths on real paper. Then, in Boston, 750,000 dollars is discounted on bills 
 ol notes, given for value between merchant and merchant, for sales and pur- 
 chases, which are always paid at maturity, but for which the holders want 
 the money sixty days before hand; this business could as well be. done, every 
 body knew, by private bankers, who would be very glad of it, or other banks 
 will always give the preference to this sort of paper. It is no inconvenience to 
 the monyed interest to discount this, as they are sure of their capital again in 
 sixty days, and they can, in the mean time, turn it over, if occasion requires. 
 
 There is left, then, 250,000 dollars due from what is called the standing 
 customers. It is a well known fact that the United States' Bank has, from the 
 advantages the deposites of revenue has given them, had their choice of cus- 
 tomers; and give to any other bank in their vicinity their deposites, they will 
 be very glad to take those customers off their hands, and to four times the 
 amount of them if necessary. 
 
 New York has loaned on its capital the greatest proportion in amount of 
 any of the branches. On $1,800,000 it has loaned $4,175,000. This has been 
 done, the report of the bank, sanctioned by the Secretary of the Treasury, to 
 the contrary notwithstanding, on the amount of deposites there; the immense 
 deposites of revenue collected there. Give them to the State banks, they will 
 accommodate the constant customers, very gladly, to the amount of one- 
 fourth, as has been stated; or, if necessary, no doubt can be entertained to the 
 whole amount of the $4,000,000. 
 
 So, said Mr. L. , of the other branches in the other towns; but, taking the 
 whole together, the debt to be continued to individuals would still be reduced; 
 something was due by mortgage and bond; how much no one but the branch 
 owners know, supposing one-fourth of the standing debt, which may be sup- 
 posed, after twenty years operation, and the whole sum with which individu- 
 als would require to be accommodated, would be less than three millions in 
 all the banks. 
 
 Having showed that there was no necessity, either of a public or private na- 
 ture, which imposed the continuance of the charter of the United States' Bank, 
 Mr. L. said he would endeavor to prove that it would be highly impolitic, 
 and, he believed, dangerous to the safety of the country to dp so. It was a 
 principle which the old charter claimed, and which was again to be recog- 
 nised by the bill before the House, that the Government of the United States 
 should have no control or even superintendence over the institution. Hewasone 
 of those who thought this power ought, in some degree, to be reserved by Go- 
 vernment, as their share in the contract, where it was of much magnitude, and 
 to operate so materially on the general interest, as well private as political, of 
 the community. It was true, the Secretary of the Treasury had, in his re- 
 port, seemed to suppose that the United States had a control over this institu- 
 tion, because it derived its charter from the National Legislature. He could 
 not see the force of the observation, inasmuch as, after the grant was made, 
 it was held independently, and he believed that the weekly returns of gene- 
 ral accounts to me office of the Secretary, which was the only thing required 
 to be done by the bank officers, could aftbrd but a feeble check upon their 
 transactions; it might amuse a gentleman fond of looking over statements of that 
 kind, but what use could be made of them? Or how was it ascertained they 
 were correct? It had been proved in the report made on them, of the third in- 
 stant, that they were utterly fallacious, and could only lead to deception; 
 and where was the remedy? You cannot penetrate into the arcana* the hid- 
 den springs of the money engine. It would not, perhaps, be correct that Go- 
 vernment should have such an influence in the conduct of a bank as to 
 control its operations, but he believed it to be correct that Government 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 455 
 
 should have a few directors, who would operate at least as a chock, and 
 through the medium of whom, some correct iLfprmation might bo got, when 
 necessary, of the secret operations of a secret tribunal. 
 
 His next objection, on the ground of policy, was, to foreigners holding stock 
 at all in a bank which is used for national purposes, and which particularly is 
 contemplated to have the sale keeping of the revenues of the country. Ac- 
 cording to this charter and the proposed bill, there was nothing to prevent fo- 
 reigners from holding the whole of the stock 5 and, indeed, it was most cer- 
 tain (Mr. L. said) that foreigners would very soon become the sole stock- 
 holders. In March, 1809, they had nearly three -fourths. Since that time 
 the United States' bank stock in London had been several per cent, above 
 the American market price for the article. It was, therefore, a profitable re- 
 mittance, which he did not doubt had taken place at the time bills were high, 
 and our produce subject to seizure in every European sea. The bill proposed 
 the creation of twenty-five thousand shares, nearly equal to $10,000,000, 
 which could only be sold to a great profit in Europe, and there he supposed it 
 would be sent for a market. Foreigners will then possess in our country a 
 capital of nearly 20,000,000 of dollars, affording a circulation to three times 
 the amount, if they choose, which must influence every part of society; nor 
 would the United States be at all exempt from the injurious effects of this in- 
 fluence, from a false reliance on the discretion of her citizens. Those citi- 
 zen directors would be elected by foreigners. King George the 3d or the 
 Emperor Bonaparte, may send their men, the ostensible owners of the stock, 
 who may easily find, among the citizens of the republic, the friends and ad- 
 vocates of crowned heads. The former, it is said, already owns a consider- 
 able' portion of this bank, and the latter, should he ever design a vital injury 
 to this country, could in n:> way so successfully effect it, as by taking the 
 management of our money matters. To buy this engine would cost him but 
 the sum of twenty or thirty millions of dollars nothing to the man who has 
 in his hands the resources of the continent of Europe. If gentlemen's fears, 
 so often expressed on this floor, have not all been mere affectation, and in- 
 tended to mislead us into dangerous alliances with England, let them reflect 
 on this subject. 
 
 Besides the political point of ruin, there was yet another in which the im- 
 policy of permitting foreigners to control such an engine among us was most 
 glaring. Having the efficient power, and it being not improbable that foreign- 
 ers might of necessity be compelled to exercise it, when all the stock shall 
 have gone into foreign hands, they would easily manage to choose such a direc- 
 tion as would give the accommodations from the bank in such a way, as to 
 favor and prevent any particular course of trade, most beneficial to themselves, 
 and injurious to the United States; and this, independently of the political 
 favoritism which it is said has already been pretty generally exercised. In 
 order to make himself better understood, Mr. L. said he would suppose a 
 case, and put it in such form as would not be repugnant to the feelings of any 
 one in the House. Suppose Bonaparte was to make the French a great com- 
 mercial nation; that they were to form connexions with very many of our 
 American merchants in our own country; that the profits on their trade were 
 to become identified, and their course of trade the same. That other great 
 French merchants, who had not partners among us, should have their agents, 
 not only to do their mercantile business, but also a sort of spies on our mer- 
 chants, as well as our Government. Could any man doubt what would be the 
 consequence of giving these foreign nations and foreign agents the encourage- 
 ment of a specie fund of twenty millions? That it would have the direct 
 effect of engrossing among them the principal means of carrying on our trade, 
 and enabling them to cramp and destroy the American merchant, if such a 
 character, under such circumstances, should be found among us. 
 
 In another and still more alarming point of view, the renewal of the char- 
 ter, particularly with an increased capital, was objectionable. It repeated the 
 indecency committed on the States, of authorizing twenty -five persons, under 
 foreign influence, to send into them any portion 01 capital, under managers of 
 
456 BANK OF THE UNITED STATES. 
 
 their own delegation, without consulting the State authorities. This was bad 
 enough, when the stock was held by the United States, and citizens of it, 
 and when the capital was only ten millions; but, increase it to twenty or thir- 
 ty millions, as may be contemplated, it will not be borne by the States. They 
 ought, and will refuse admittance to these foreign agents. Let it be remem- 
 bered, that, when the branches were admitted under the present charter, it 
 was not only under the recommending circumstances before mentioned, but it 
 was at a time when the States had no banks of their own. They have all now 
 institutions of this kind, and they will not suffer an intrusion so unreasonable, 
 unless they participate in the advantages, and are made safe by some share in 
 the control. Virginia, in 1795. permitted the introduction of a branch; she 
 has since banks of her own, some of which have smarted under the lash of 
 this bank. Increase the power of this foreign engine an hundred per cent., 
 and Virginia would not consent to entertain it he hoped she would not. Mr. 
 L. declared that he did not believe that the stockholders in the United States 
 had any right to nvike a contract for a renewal; a general meeting could only 
 exercise powers within the grant of the charter. It required all, or at least a 
 majority, to make a new contract. 
 
 Mr. L. next adverted to the particular section he had moved to strike out 
 of the bill. He remarked on the first provision, which proposed a sale of this 
 privilege to the United States' Bank Company for twenty years, for the price 
 of $1,250,000; that, although the establishment of a national bank, on proper 
 principles, was presumed to be necessary to the proper management of the 
 finances, to grant an exclusive privilege of such an institution, was unconsti- 
 tutional; that the constitution had only authorized this kind of high preroga- 
 tive grant to the authors of useful inventions, thereby intending to foster ge- 
 nius, and not rivet on the community the powers of a political or corporate 
 body. No one would pretend that a bank was a new invention. The Bank 
 of North America was older than the United States' Bank. For the pur- 
 poses of finance, it was not necessary the right should be exclusive, but the 
 contrary; and very great safety, as well as utility, might be found in competi- 
 tion. It was possible it might have been deemed necessary, on the first es- 
 tablishment of the bank, when its success might have been supposed doubtful. 
 It could not now be advocated for that reason, or any other reconcileable with 
 the principles of justice or common sense. 
 
 But, Mr. L. saidj he could not account for the monstrous proposition con- 
 tained in this provision. The bank company were to be authorized to sell 
 25,000 snares, equal to $10,000,000 more of capital for their own emolument. 
 This would probably be worth to them, twice or thrice as much as they were 
 to give for the renewal of the charter. They would, he presumed, be sold 
 also to foreigners, and thus there would be introduced an additional foreign 
 bank capital, which would overwhelm all the little American institutions of 
 the kind. Mr. L. said he was afraid he could not speak with temper on this 
 subject; and asked if gentlemen thought it expedient to make this sale of their 
 interests to foreigners. He could not deign to look at the paltry and inade- 
 quate.consideration; but he believed it would be better for the United States, 
 this moment, to be compelled to engage in a seven years' foreign war, than to 
 consent to be subjugated in the manner this monstrous proposition would effect. 
 
 By the next provision they were not to be compelled to loan to the United 
 States more than $5,000,000, and a rate of interest seemed to be fixed for that 
 at six per cent.: for, if the bank were unwilling to lend a cent, (and foreigners 
 are not likely to aid our Government, particularly in times of difficulty) they 
 need not do it, unless we give them six percent, and then not exceeding five 
 millions, when it is known, to any man who is capable of a moment's reflec- 
 tion, that a bank can always loan to Government for half the rate it can loan 
 to an individual. At all events, a bank can loan to Government the amount 
 of its capital, by partial calls, as the section provided, at a lo\v rate of inter- 
 est, as they have the greatest facility in their power of securing extra funds, 
 but most particularly a bank whose paper is receivable in all payments to Go- 
 vernment. 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 457 
 
 Mr. L. said he had, but the moment the subject was called up, had an op- 
 portunity of glancing at the bill, as he had been necessarily and involun- 
 tarily absent tor several days, and had rode a considerable distance that 
 morning to the House. He hoped he might have misapprehended the mis- 
 chief ot the proviso. He proceeded to the next paragraph, and said he found 
 some difficulty in understanding it, from reading it in his place. It contem- 
 plated a contract with this institution, to have the deposites of our reve- 
 nues, by agreeing to an interest of three per cent, when they exceeded a cer 
 tain sum, and, it he understood the bill, there must be a sum of three millions 
 in the bank for fourteen months before the United States would be entitled to 
 draw any interest; and, after they notify their intention to draw interest, 
 they must permit the whole of this sum to remain at least twelvemonths lon- 
 ger. These were hard terms, and nothing but an exclusive privilege could 
 compel a submission to them: for the State banks would be glad to nave our 
 deposites on better terms, could we be left at liberty to offer them. It is 
 said (said Mr. L.) that they should be ensured the use of our money for at least 
 two years and two months; should get at least eight, he believed eleven, per 
 cent, for it, and only give three ! But, on more important grounds of con- 
 sideration, can we submit that this institution shall, whether we will it or not, 
 keep possession of our revenues for at least twelve months ? Suppose, in times 
 of peace, our revenues should accumulate to $50,000,000 of deposites; Great 
 Britain or France takes occasion suddenly to declare war against us; their 
 subjects, then, have this sum at their command, for twelve months, while we 
 may sue for five millions, on a loan of six per cent, and they have fifty millions 
 of our money at three per cent, and, before the twelve months expire, may 
 pay us with the cannon it has bought for them. 
 
 nut the United States are, also, if a future law can be obtained in this 
 House for the purpose, to have a right to subscribe for blank shares ! How 
 complete is the delusion here intended by the agents of this bank. They go 
 first into market with their ten millions of stock; if a law afterwards can be 
 got (and we know how difficult it is to get a law passed through both Houses 
 on any subject} the United States may then go into market with their stock, 
 provided they do not sell below a certain price, which, at least, may be presum- 
 ed twenty-five per cent. The bank company are also in market, and they can 
 make the $1,250,000 they give for the extension of their charter, if they sell 
 their $10,000,000 at twelve and a half per cent.; if they sell at twenty-five per 
 cent, they get $2,500,000, and gain, in numero, by the bill before us, the 
 clear sum of $1,250,000, instead of paying that sum for it. 
 
 Mr. L. said nothing could be more partial than the provision with respect 
 to the District of Columbia; reciprocity in contracts was a maxim of justice 
 not to be dispensed with; but, this United States' Bank, as it is falsely called, 
 might introduce its branches into the District, and establish such a capital 
 here as to destroy the banks already here, and carry its foreign influence into 
 the very heart ot our country. Can it be the design of gentlemen to destroy 
 the growing prosperity of this place ? Mr. L. called on the western repre- 
 sentation, and the Potomac interests, to oppose the bill. He enlarged on the 
 propriety of fostering the interests of the District, as a great means of preserv- 
 ing the Union, and promoting the convenience of the Government. 
 
 Mr. L. further remarked, that the observations he had made were under 
 the pressure of extreme fatigue, and hoped the committee would pardon him 
 tor detaining them, as he had done it only from a sense of duty to his coun- 
 try's interests; that, on another day, he should be better able, he hoped, 
 to face the threatening danger: for, he was told but he could not believe it- 
 that a majority of the House had thought favorably of the bill. He declared 
 it to be impossible ! and said that, of all the unwise acts of the most unwise 
 administrations of this country, none had ever equalled, in madness and folly, 
 the present project. 
 
 Mr. TAYLOR said it almost always happened, when gentlemen rose and 
 prefaced their remarks with a declaration that it was the first time they 
 58 
 
458 BANK OF THE UNITED STATES. 
 
 had read the bill under discussion, that they made mistakes; and the allusion 
 just now, of the gentleman from Virginia, to his (Mr. T's) listlessness to hi& 
 arguments, proceeded from the gentleman's having argued for half an hour on 
 a blank in the bill. Does the gentleman suppose, (said Mr. TAYLOR) that he. 
 is now addressing a county court, and that the advantages of special plead- 
 ing are to be allowed to him? All the debate which can take place cannot 
 change the vote of any members of this House. They have not been absent, 
 like him, from the House; nor, like him, for the first time, seen the bill to-day. 
 
 Sir, I am no stockholder. 1 neither hold a share in the Bank of the United 
 States nor any bank in (he United States. I am of that class of the commu- 
 nity, by some called clod -hoppers. For their interests, I stand up. I wish 
 that the charter may be extended, and am desirous, in that way, to paralyze 
 the speculation, now standing, like the pike, ready to snap at the bait. I am 
 an advocate for the interests of the honest yeomanry of tnis country. It is 
 due to them, and to this House, that I should explain the motives on which I 
 act; the grounds on which I proceed in relation to one topic which the gentle- 
 man forgot, but which he might find a fair excuse for, in his own oil I I 
 mean the constitutionality of the proposition for erecting or continuing a bank 
 at all. 
 
 The constitution of the United States has given to the Legislature of the 
 United States certain powers, amongst which is the power to lay and collect 
 taxes, duties, imposts, and excises, and the power to borrow money on the cre- 
 dit of the United States; and the concluding clause of power, applicable to all 
 the powers granted, gives power to make all laws necessary and proper for 
 carrying into execution the foregoing powers. As the gentleman himself 
 admitted, and as we have been told by the Secretary of the Treasury, 
 the highest authority in the nation, on financial affairs, that a banking insti- 
 tution is absolutely necessary for collecting and transferring the revenue 
 of the United States, I am saved the trouble of establishing the constitu- 
 tionality of the Bank of the United States. He admits that one bank is 
 necessary, and, because one is, two might be established. I take the other 
 end of the argument, that a general bank is necessary for carrying on the 
 fiscal concerns of the Government, and that Government is bound to incor- 
 porate an institution of that sort, under the words "necessary and proper." 
 If one bank of the United States is, for that purpose, necessary and proper, 
 and sufficient, all the power to be derived from that article of the constitution 
 is exhausted, and we cannot exercise it any further. Having obtained such 
 an institution as is necessary for the collection of the revenue, you cannot, 
 by any power in the constitution, multiply institutions for the same purpose, 
 as you will have one coming up to the definition of necessary and proper. 
 Therefore, when Congress shall have granted a charter to any one bank, I 
 believe it would be incompetent, in the Legislature, to grant a charter to any 
 other bank in the United States, under the excuse of its being necessary and 
 proper for the collection of the revenue of the United States; because, they 
 will have exercised their power to the full extent. When they transcend it, 
 I will join gentlemen, and say we are treading on unconstitutional ground. 
 It is from the necesity of the case that the monopoly arises- 
 
 The impolicy of employing foreign capital has been very much inveighed 
 against. Does the gentleman recollect the case of a majority of planters in the 
 Southern States; that they, from year to year, are in the constant habit of borrow- 
 ing foreign capital? They open accounts with the merchants on the first ot 
 January, and, if they pay punctually, they pay them at the end of the year. 
 The merchant, if he acts wisely, adds to his profit the interest of the sum he- 
 owes over the water, for his goods, and the planters pay this " foreign tribute." 
 Has the country grown the poorer for it? Look back, sir ? to the first settle 
 mentof the country, and the value of every acre of land which has been opened 
 and cultivated by the aid of this very foreign capital. It is a new idea to me, that 
 we should thus start at the bugbear of foreign capital. I thought the country 
 was more flourishing, in proportion as you hold forth to foreigners an induce- 
 ment to employ their capital here. If we pay five per cent, for a capital 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 459 
 
 on which we gain ten, iii'teen, or twenty per cent., it is again to the country. 
 The argument of the gentleman is fallacious. Practice, which is a better 
 guide than any theoretical speculations, will show, that the wealth of the 
 country has been increased from this foreign capital j from this bugbear, which 
 the gentleman is so much alarmed at! 
 
 But, says the gentleman, there will be a foreign influence. George the 
 Third may come over to reside here, 1 suppose: for, unless he were here, he 
 could not vote. Sir, if the sky were to fall, we should catch larks; and that 
 is nof a more extreme case than the gentleman's hypothesis. [Mr. LOVE said 
 he had supposed that the King of Great Britain would send his agents to re- 
 side here, who, being ostensible owners of the stock, might have the whole 
 direction of the bank.] Then, it seems, said Mr. T., that we are re- 
 lieved, at least from one bugbear. All Europe would be much obliged to us, 
 too, I fancy, if Bonaparte, either by himself or proxies, were to come here 
 to speculate in bank stock, instead of busying himself about the affair* of 
 Europe. All Europe would be glad to see him employed as a stockjobber in 
 the streets of Boston or elsewhere. How are these monarchs, by their agents, 
 to rule the bank, and work these wonders by it, when, by the original charter 
 of the institution it is required, that stockholders who are citizens of the 
 United States, shall alone be eligible as bank directors? Suppose, however, 
 that foreign stockholders had all this influence, and exerted it to gain the di- 
 rection of the bank; if they continued the bank, pursuant to the ordinary 
 rules, which every shop-keeper knows it ought to pursue if the bank should 
 pursue its own interest, it would, at the same time, pursue ours. The mo- 
 ment it was attempted to be made a political engine, that moment, the jealousy 
 which the gentleman now feels the jealousy which a free People feels would, 
 at once, withdraw custom from it. 
 
 It would sink! It is only by piusuing its own interest that this bank can 
 flourish; 1 wish it in such 'hands that it will pursue, its own interest; lean 
 no more suppose that it will be made use of by foreign influence, to our inju- 
 ry, than that the credit given, of a year, and sometimes longer, to our plant- 
 ers, for stutts, hoes, and working utensils, &c., operates to the injury of the 
 country. Neither would I give to the Government of the United States any 
 control over this institution. I would not put into the hands of one party or 
 another, as it became rotten by its own sins, the power of wielding such a 
 moneyed engine aa this. The jealously of a freeman, which would, in the 
 gentleman from Virginia, be allayed by such a course, would make me abhor 
 giving the Government the control over it. 1 then should stand up, a stickler for 
 State rights, and against measures tending to bring about a consolidation of the 
 Government of the Tinted Siatrs. For that reason, as a republican, I am op- 
 posed to vesting the Government with any indirect surreptitious power of con- 
 trolling the feelings of the People of the United States, for party purposes. I 
 do not know but what I may wish to see the present majority, if they degene- 
 rate, as they may, entirely changed. I do not say such will be the case, but 
 it might. If it were, 1 wish not to have this engine operating against me. 
 
 With respect to State rights, I believe it is more easily to be demonstrated, 
 but of which I shall not attempt the demonstration, that the States are consti- 
 tutionally prohibited from erecting banks in their own States, than this 
 Government from erecting the bank we are now discussing. [ fancy these 
 bank bills are but bills of credit, after all, which the constitution expressly 
 prohibits the State Governments from issuing; but as the States have, with- 
 out even saying by your leave, sir, exerted this power, and I am contented that 
 they should have it, 1 would let the usage or custom establish the law on the 
 subject. In the same manner, I am willing that the Government of the 
 United States, from the same usage, the same custom, the same acquiescence, 
 in this bank of the United States, should have the advantage of the same sort 
 of usage. I recollect well to have heard, in the first administration of the 
 illustrious Washington, that, under the treaty-making clause, the President 
 construing the word " advice" to mean something more than mere consent, 
 did actually go into the Senate for the purpose ot making a treaty with Mr, 
 
460 BANK OF THE UNITED STATES. 
 
 McGillivray and the Indians; and finding the thing so utterly impracticable., 
 had to retire and do it by his deputy; and, from the inconvenience of the 
 thing, the word advice is practically erased from the constitution, I do not 
 nnd, even under the republican administration of Jefferson, that it was at- 
 tempted to reduce the clause to practice. When the Senate give their con- 
 sent now, they give their advice also; but their advice is never called before 
 the treaty is finished. Sir, I could turn to cases, too, in which the republican 
 administration have actually covenanted and agreed with this company for 
 loanswith this company, which,if the dpctrine now urged be correct, received 
 a stolen charter, and with whom it would, in such case, be as disgraceful to trade, 
 as for a man to trade with a notorious receiver of stolen goods. Precedent is 
 strong on this point. The State which the gentleman, (Mr. LOVE) represents, 
 has given strong proofs that usage has weight with them. What have they 
 done which evinced it? In the year 1795, when the interest on debts, due to 
 the State of Virginia, amounted to but two per cent. , a special law was passed, 
 by the State Legislature, authorizing this institution to receive six per cent. t 
 when others received but five. If that was not an acquiescence in it, I know 
 not what is. The State which I have the honor to represent, (South Caro- 
 lina) have not, to be sure, traded with the institution; but every year, for the 
 last six or seven, in the annual tax bill, the collectors have been directed ta 
 receive the tax in silver or gold, or in paper of the branch bank at Charleston, 
 or their own banks. If this be not trading with them, it is an acquiescence in 
 the value of the bill issued by that institution, and is, so far, a manifestations 
 of the public sentiment. I dare say, if I had the statute laws of other 
 States in the Union, the same sort of acquiescence might be produced on 
 record. It is the case in the State of New York. 
 
 On the subject of loans, sir, it was the policy of that very republican ad- 
 ministration, which that gentleman applauded it will be the policy, I hope, 
 of this administration not to obtain money on extensive loans. The idea of a 
 public debt, being a public blessing, seems to have been exploded, and tem- 
 porary loans are to be obtained only from moneyed institutions. Individuals 
 loaning for a short time, and vvho are obliged to go into market to reinvest 
 their stock, ask a greater premium for their money. Practice has provsd that 
 banks can do otherwise. 
 
 The argument of the gentleman, that Government will be obliged to give six 
 per cent, for money, would tax him with a want of candor, if he had not said 
 that he had but just read the bill. The bank will have no advantage over other 
 individuals, in this respect, unless they make a loan for a shorter time, and on 
 lower terms. The bill fixes the maximum, but not the minimum. It does 
 not prevent the United States from borrowing money at five per cent., or 
 three per cent., or at the lowest rate at which money could be obtained, across 
 the Atlantic, from a Dutch broker. The maximum was inserted to prevent 
 foreigners from screwing the Government, and obtaining an extravagant inte- 
 rest. We can only look to the bank for temporary loans. If the Govern- 
 ment should ever be so sorely pressed as to require larger loans than five, 
 millions, it would be policy to make extended terms, to reduce the interest. 
 What will be the consequence of putting down this, and refusing to establish 
 any other similar institution? When we want to borrow, we must apply to 
 the States, for acts of their Legislatures, to authorize their banks to lend mo- 
 ney, and be thrown back into the state of the Congress under the old con- 
 federation, when they called, am 1 called again, but could not obtain a com- 
 pliance with their requisitions. Loans for temporary accommodation, only, 
 ought to be asked for. 
 
 The language and feelings of the State Legislatures are brought into view, 
 and an attempt is made to frighten this House with this sort of thunder clouds. 
 They pass by like the idle wind: they have no effect on me. I will tell you 
 where you would meet with the scowl of the State Legislatures: for they are 
 not composed of moneyed capitalists, but of the honest yeomanry of the coun- 
 try. It would be to issue exchequer bills^ to send afloat another Yazoo bub- 
 ble; to blow, with a mighty wind, the shocking flame of depravity which has al- 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 ready caught in some parts of our country I mean the spirit of speculation 
 which will diffuse itself from one end of the continent to the other, in these 
 exchequer bills, or these bank bills, to pass after we put to death the present 
 bank. This phoenix, which the gentleman is to raise from the ashes of the 
 defunct institution, is to go forth cm bono? That so much only shall be 
 given for them, by the moneyed capitalist, as shall enable him to^ speculate on 
 the unwary. The six millions of profit will not accrue to the United States, 
 but the cormorants will gorge with it; the speculators, from one end of the 
 continent to the other, will reap the benefit. On the contrary, sir, the money 
 to be received under this bill, would go into the hands of the honest yeomanry 
 of the country: for. when it is in the treasury, it is so much deducted from 
 what they would otherwise have had to pay. When exchequer bills are circu- 
 ated, where, at last, do they go? After the cormorants and rooks have made 
 the most of them, they travel across the Atlantic, and the People of the United 
 States are not benefitted, but injured by them. The end of both schemes is, 
 according to the gentleman's own showing, that the stock and interest will go 
 into the pockets of foreigners. Where, then, is the objection to the present 
 plan, which would not equally apply to his own? I cannot see it. 
 
 Not only, sir, will the Government of the United States, according to the 
 usage of commercial nations, make this company, fairly and honestly, pay the 
 value of their charter, with the conditions annexed; but there is a benefit given 
 to the United States, of drawing interest upon deposites, to a certain amount, 
 which they had not under the old charter. There is also an advantage given 
 to the United States, of subscribing nine millions of dollars, not more than 
 once in any one year; and from the manner in which it is conducted, and 
 according to the report of the Secretary of the Treasury, which must be 
 correct, or he is wanting in his duty, which no man in the House suspects 
 from each of those millions you subscribe, you will receive, perhaps, as 
 high a profit as upon those bank shares which were sold to Sir Francis Baring 
 and Company, at forty-five percent, advance; say, however, only twenty-five 
 per cent, which will make the profit on each million, twenty-five thou- 
 sand dollars. But this is too low a calculation. I believe shares will rise 
 much higher, not from their real value but I will state candidly, that I be- 
 lieve they will be sold to foreigners, and that we shall get fifty per cent, 
 on each share, and for each million, 500,000 dollars advance; which will 
 be a total profit to the United States of 4,500,000 dollars, which, with 
 1,250,000 dollars, to be paid down, will be 5,750,000 dollars; equal to the 
 promised bonus^ from the gentleman's exchequer bills, without the bubble 
 they would raise. If the plan which I propose be adopted, there will be no 
 uproar and speculation throughout the continent; the mercantile gentlemen 
 will manage it among themselves, and we clodhoppers shall not suffer from it. 
 On the contrary, we shall feel the benefit of it, in having saved us a contribu- 
 tion of six millions of dollars to the public treasury. It will put down the 
 spirit of speculation, and, for that paramount reason, if there were no other, 
 I would adopt it in preference to any other system. 
 
 I will state, and it is fair that I should do so, that the committee have had 
 a conference with the agents of the bank, and with the Secretary of the Trea- 
 sury. You have got, said the latter, the utmost extent of the bonus you ought 
 to expect; and, at the same time, I believe, sir, I may say, that there is the 
 utmost probability that, if this bill passes, with the provision contained in it, 
 or with such reasonable modification as may be made, it will be accepted. 
 The establishment or renewal of the bank will save you the necessity of 
 borrowing the sum necessary to supply the present deficit in the treasury, on 
 disadvantageous terms, because you will be able to borrow it, to be repaid in 
 as short a time as you please to ask. If we wish not to create a national debt, 
 it is all important that we should have it in our power to borrow money for 
 short periods, arid on the lowest terms; both of which advantages will be af- 
 forded by this institution. Allowing that other banks had sufficient capital 
 to answer the same purpose, they could not do it without applying to the States 
 
462 BANK OF THE UNITED STATES. 
 
 for authority. In some of the charters, 1 have seen an express provision 
 against it. 
 
 Sir, I do not expect the present cloudy night is to last long. I look for a 
 bright morning, when commercial nations shall cease to worry each other; 
 when commerce shall resume her wonted activity; when the treasury shall 
 again boast its millions. When that time comes, how degrading will it be to 
 the Government, which shall not have anticipated such an event, and shall 
 have borrowed money at high interest, for a term of eight, ten, or twenty 
 years, when her coffers shall be full, and she shall not be able to pay the pub- 
 lic debts. It is all important that the Government should have the power of 
 making short loans; and it can only be had by passing a bill to continue this 
 institution in operation. All this talk about the immense quantity of bullion 
 in the United States, is, it appears to me, erroneous; I believe it exists only 
 in the gentleman's head With all my respect for the embargo, I will observe , 
 that it was calculated, as we could not send produce by land, and our mer- 
 chants owe.d money over the water, to drain the country of specie. It did so; 
 and the stories we heard, of barrels of guineas going over the lines to Canada, 
 are proofs of it. W^ill gentlemen recollect that, in Great Britain, gold sells 
 twelve and a half per cent, above par? That, alone, is an inducement to carry 
 it there. Money will go to the place where it can be most conveniently used. 
 I consider it a good domestic guest, if it could be kept here; I would not drive 
 it out of the country. In the days of our forefathers it has done so much good, 
 that, out of gratitude for former favors, I would not be lor d living it out of 
 the country. I would not, by a refusal to renew the charter, weigh anchor to 
 near seven millions, or, according to the gentleman's suspicions, nearer ten 
 millions of dollars. We want it here; and the anticipation of war is the 
 greatest argument in favor of keeping it here. It is all idle, sir, to talk of the 
 deleterious effects of borrowing money from foreign countries, when we recol- 
 lect that every planter in the country where I live, has grown rich by foreign 
 capital; has grown rich on land, which, without foreign capital, he could not 
 have cultivated; and which, instead of five, has, by that means, become worth 
 fifty dollars an acre. This foreign capital is the greatest stimulant the coun- 
 try has ever experienced. I believe the utility of employing foreign capital, 
 in the United States, is the strongest ground on whicn the institution can 
 stand. 
 
 I have done, sir. I have but incidentally touched the details of the bill. 
 From being utterly unacquainted with banking affairs, and never having own- 
 ed a share in any bank, the insinuation of the gentleman from Virginia did not 
 touch me. Sir, the gentleman does not think it could affect me he did not 
 think so when he uttered it. I never received accommodation of any bank 
 for a cent. For my country I act, not for myself 
 
 Mr. FIND LEY said he wished to offer a few observations, that would ap- 
 ply both to the bill and to the amendment, but was pi-evented by the mo- 
 tion for the bill laying on the table, made by the gentleman from Virginia, 
 (Mr. LOVE) which precluded a reply to his arguments. [Mr. LOVE withdrew 
 his motion, and Mr. F. proceeded.] 
 
 When the Bank of the United States was incorporated, there were but few 
 banks in the United States, and very little experience of the banking system 
 was possessed, and such as had been acquired had given an unfavorable im- 
 pression. Towards the close of the war, in a time ol great pecuniary distress, 
 Congress passed an ordinance incorporating the Bank of North America, but, 
 knowing that this ordinance could not give it effect, they recommended the 
 incorporation thereof to the respective State Legislatures. Pennsylvania and 
 Delaware, only, obeyed that recommendation. It was organized in Philadel- 
 phia, and though the capital was small, it yielded essential relief to the Go- 
 vernment. 
 
 The charter was a complete monopoly; it was not limited in duration, and 
 was vested with the exclusive right of banking by the ordinance by which 
 it was incorporated, in the whole United States, as far as that ordinance 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 
 
 was obligatory. When the war was concluded, a new company was formed 
 in Philadelphia for the purpose of banking; but when they applied to the Le- 
 gislature for a charter of incorporation, the Bank of North America claimed 
 the exclusive right, and after being heard by counsel, the application of the 
 newly formed company was rejected, in consequence of which the next Le- 
 gislature repealed the charter of the Bank of North America. Many thought 
 it would have been better to have revised than to have repealed this charter, 
 but the People had been more powerfully impressed with some incidental 
 hardships that had resulted from the operations of the banking system, than 
 with its advantages, not yet fully developed. That bank was still kept alive by 
 the charter from the State of Delaware. The impression on the minds of the 
 People of Pennsylvania, at that time, and in several other States, was, that 
 banks were, if not a nuisance, at least dangerous, and of no use to govern- 
 mental operations. After two years, however, the bank obtained a limited 
 charter. 
 
 In about four years after this, the Bank of the United States was incorporat- 
 ed, and the act of incorporation \v-is powerfully opposed on the ground that it 
 was contrary to the constitution of the United States; and it was supported on 
 the opinion that it was necessary for conducting the moneyed transactions of 
 the Government in the best manner. It was admitted that, if it was necessa- 
 ry, it was contained in the powers vested in Congress to levy and collect 
 taxes, duties, imposts, and excises, and pay the debts of the United States, to 
 support armies, and, in general, to provide for the common defence; because, 
 when a special power is given, it contains in it all powers necessary to carry 
 it into effect, and because the constitution expressly vests Congress with all 
 powers necessary and proper to carry the given powers into eftect. There- 
 lore the question of the constitutionality of the bank solely depends upon the 
 question, whether it is necessary and proper for conducting the moneyed ope- 
 rations of Government. So great a change has taken place on that subject, 
 within twenty years past, that it is supposed that question is now settled. 
 Not only the moneyed transactions of the United Slates, but, it is believed, of 
 all the State Governments, are carried on through the respective banks, as well 
 as commercial transactions and other moneyed negotiations. Pennsylvania, for- 
 merly so much opposed to banks, has, ^ince that period, incorporated many, and 
 for about seventeen years past has connected banks with the Government, and 
 conducts her moneyed transactions by their assistance. This much is ottered 
 with respect to the constitutional authority of Congress to incorporate a bank, 
 because it is known that some members and many citizens still doubt of it. 
 
 Mr. F. said, that, from the ground on which the gentleman, just sat down, 
 (Mr. LOVE) had placed the question, it was rather indelicate to oppose his 
 arguments. He had stated it to be a question between those who were friends 
 of the country and those who were not so. However, as he had also said, be- 
 fore he sat down, that he did not himself understand it, and also that he be- 
 lieved that many other members did not understand it; to the truth of this, 
 Mr. F. .said, he did not object, but, however little he might understand the 
 subject of banking, he presumed that he knew so much of it as to convince 
 the gentleman that he was not supported in all he had asserted, and that some 
 of his arguments were not fairly deduced. 
 
 The honorable gentleman, both on a former day and the present, has charg- 
 ed the directors of the Bank of the United States with having acted unfairly, 
 nay, even with fraud; that the records of their transactions are evidently fal- 
 lacious; that they cannot be understood; that the bank has produced much 
 more than is accounted for by the dividends, &c. ; that the Secretary's report 
 is inconsistent, and throws no sufficient light on the subject. 
 
 One proof he gives for the truth of this charge is, that the branches at Bos- 
 ton, New York, &c. account for having gained ten or eleven per cent, on the 
 capital of their vaults, and that the mother bank had in her vaults a capital 
 nearly equal to that in all the branches, about $4,500,000, and yet does not 
 account for more than six per cent, or not so much; and he considers this cir- 
 cumstance as a demonstration that the mother bank, at least, has acted afrau- 
 
464 BANK OF THE UNITED STATES. 
 
 dulent part, by concealing her profits; whereas, if the gentleman had under- 
 stood the subject, he would have taken it at least as a strong presumption 
 that the directors have acted honestly and correctly: for this is just the way 
 it must have been, if it was honestly and wisely conducted. He has consider- 
 ed the bank and its branches as so many distinct banks, haying their capital 
 independent of each other. This seems to be the source of his mistake. The 
 capital is one. It is the capital of the Bank of the United States. When a 
 branch is established in any State, the Bank of the United States appoint the 
 directors for the branch, and vests so much capital in it as will probably be 
 thought necessary for the demand, aided by the credit of the great firm. The 
 bank itself is the great denosite or reservoir which contains Sie capital, and 
 possesses the credit by which the whole is supported. If the negotiations of 
 some branches, whether on the east or south, necessarily extend to discounts, 
 the mother bank must extend her credit, viz: must authorize the branches to 
 draw on the mother bank, as, if a run is made on them unexpectedly, she must 
 do the same. Consequently, she must always have sufficient capital in reserve 
 ready to meet all such exigencies, and must not extend her discounts. If she 
 did otherwise, she would have justly merited such censure. If the honorable 
 gentleman had understood this, he would not have censured the institution for 
 what she would have been justly censurable for not doing. 
 
 The buildings and conducting of the bank and its branches requires consi- 
 derable expense. A branch that produces no profit, but sometimes loss, may 
 be as expensive in keeping it up as those that are productive. The gentleman 
 has produced none but such as are most productive. Others may be kept up 
 at considerable loss. If such unfounded objections as those had been antici- 
 pated, they might have been rebutted by facts, with which he was not now 
 prepared. One fact, however, Mr. F. said, he would offer in illustration, 
 taken from a similar institution. The Bank of Pennsylvania, in which that 
 State was largely interested, had established a branch at Pittsburg, which did 
 much business. She received in deposite the money of the United States, 
 received for public land, and money of the merchants and dealers of the 
 States on the Ohio, and, in return, gives drafts on the mother bank, on such 
 terms as are agreed on; (to the United States she makes no charge. ) She ac- 
 cepts of the drafts of the treasury from this city, and discounts notes to a 
 large amount, and yet has never received any capital sum from the mother 
 bank, but draws upon her credit. This answers every purpose, in the situa- 
 tion of that country; but the mother bank must always reserve sufficient sur- 
 plus capital to answer the demand. These drafts are more valuable in that 
 country than specie. 
 
 In order to give credit to the gentleman's assumed charges of fraud, against 
 the directors of the Bank of the United States, we must first believe other 
 very extraordinary things. We must believe not only that all the directors 
 of the bank, elected by me stockholders on the account of their known talents 
 and integrity, six of wnom have been changed annually for near twenty years, 
 to have been dishonest, and chargeable with a breach of sacred trust, but that 
 all the directors of the branch banks have been so also, as \yell as all the 
 cashiers and tellers, who are changeable at pleasure, and have frequently been 
 changed, have united in the fraud, and while they robbed their employers, 
 were so honest to each other that, even after they have been removed from 
 their trust, or turned out of employ, they have never to this day made the dis- 
 covery. Nay, we must believe what is still more extraordinary: we must 
 believe that the stockholders, frequently also changing, were fools. Each of 
 them had a right to inquire into the affairs of the bank, and the conduct of the 
 directors, and it is to be presumed they have done it, and were satisfied. The 
 Secretary of the Treasury has, for the time being, had authority by law to 
 inspect the directors of the bank, and did do it, and obtained weekly returns 
 of its situation. These, though of different political parties, were all men of 
 character and talents, whose moral character has not been impeached. The 
 present Secretary of the Treasury is supposed to be honest, ana his talents on 
 this subject are admitted by all. Indeed, the gentleman from Virginia has 
 
u\ rill. HILL TO RENLW THE CHARTKIJ <H 1791. 
 
 not directly questioned his integrity, but has charged him, at Jeast, with in- 
 < oinpetency. It is certain that lie, and all the former Secretaries must have 
 been either incompetent, or dishonest, or both, if the honorable gentleman's 
 assertions are correct. 
 
 Mr. F. assured the House that he was not, nor ever had been, a stockholder 
 of that bank, nor received any accommodations from it, and believed he never 
 would: and, judging from his .situation and time of life, he thought he was 
 disinterested, and could have no view but the public good, as far as he under- 
 stood it. He had been acquainted with many of the directors of that bank, 
 from its commencement, and knew their moral characters to have been unim- 
 peachable, but, by the law of its corporation, ail the directors had been chang- 
 ed; one had been President of the Bank of North America since its com- 
 mencement (which was the first bank in the United States) until he was 
 elected director, and afterwards president, of the Bank of the United States, 
 and continued to preside over that institution until he declined the honor and 
 the labor, not long since. If the gentleman's charges against the directors of 
 that bank are well founded, this venerable character, (Thomas Willing) 
 never heretofore charged with dishonesty, must have been dishonest in a 
 higher degree than all the rest, because he had the superintendence of the 
 Bank of the United States and all its branches for the longest period. 
 
 If we are to discredit these records, and give credit to these charges of in- 
 tentional fraud, so long continued, and so successfully carried on, we must 
 give up all confidence in moral integrity and artificial clu-c k>. None can 
 have ft greater interest in seeking for moral integrity and talents, than the 
 stockholders have. It is their property that is at risk; none can have greater 
 checks on their conduct Six directors, bi'ing stockholders, a 
 
 , , and going out 
 
 every year, are very capable of understanding the subject and making a scru- 
 tiny, which every stockholder has a right to do. If they conceal the profits of 
 the bank, they do it at their own loss a circumstance very hard to believe of 
 moneyed institutions, whose sole object is gain: for it must be admitted that 
 the price of stock is regulated by its productiveness in dividends. In short, 
 if the gentleman's charges against the bank directors c. are well founded, 
 we can have no confidence in our revenue officers, nor in any department to 
 whom the receiving or paying money is entrusted. 
 
 The honorable gentleman is alarmed with the dangers of foreign capital in 
 the vaults of the bank, and amount of the dividends annually drawn to Eu- 
 rope; he concluded with the impressive apprehension that the day was not 
 far distant when France and the United States would be in friendship: that, in 
 that case, Napoleon, by his agents, might purchase half the bank stock, and, 
 through that medium, govern the United States. 
 
 Mr. F. said that the use of foreign capital had, heretofore, been of great 
 advantage to the United States: that, from the use and improvement of this, 
 our own commercial capital had been created, and our country improved. 
 The gentleman had introduced the opinion ol Mr. Baring, and given, he 
 believed, a just statement of his wealth and credibility. That same Mr. Bar- 
 ing had, if he recollected well, stated that the merchants of the United States 
 were always indebted to the British merchants and manufacturers upwards 
 of 2,000,000 sterling, for which they had a credit of eighteen months, and on 
 which, they sometimes acquired double the amount in trade, before the capi- 
 tal was paid. Why did riot gentlemen consider this foreign capital as dan- 
 gerous to the United States, which, if the maxim is true, that the borrower is 
 servant to the loaner,it certainly is? For this capital, our own citizens are under 
 obligations to foreigners; for the stock subscribed for, by foreigners, in the 
 bank, they are under obligations to us. How has it happened, that this, much 
 more extensive amount, and much more influential use of foreign capital, has 
 wholly escaped the honorable gentleman's observations? For his own part, Mr. 
 F. said, he believed that forefgn capital had been of use to the improvement 
 of this country, and much more safely in the form of bank stock than other- 
 wise. In the present state of the world, however, circumstances had, in a 
 tew years, greatly changed. He would not be alarmed to see Napoleon being 
 
466 BANK OF THE UNITED STATES. 
 
 the ^ purchaser of the half, or even of the whole of the stock of the Bunk of the' 
 United States, as he could have no vote in the direction of it. This would be 
 the best security we could possibly have for reimbursement of the spoliations 
 committed by his orders. Foreigners having no vote in the choice of directors,, 
 the stock is wholly in our power. They can, even now, purchase up all the 
 stock of any State bank, if they please. It is for sale in the market. Seques- 
 tration of enemy's property is a just retaliation for depredations on the ocean, 
 bu t ought to be the last resort. Commercial debts are hard to discover; commercial 
 honor conceals them; but bank stock cannot be concealed: therefore y the se- 
 questration of bank stock is the best security we could have in our power to 
 operate against our greatest enemy, even if that should be Bonaparte, 
 
 There is also a mistake about the value of the deposites in the bank; their 
 value arises more from their certainty than their amount. No bank will venture 
 to discount on deposites that may be withdrawn the next day. The bank di- 
 rectors know the course of business in which their customers are engaged; 
 they know when the deposites will be withdrawn, and when others will be 
 made to replace them. On these they can calculate with certainty, and dis- 
 count accordingly. But, this is not the case, at least in as high a degree, 
 with revenue deposites. The quarterly payments of the public debt may, in- 
 deed, be calculated on, with tolerable certainty; but this is not the case with 
 numerous other demands on the public revenue, to meet .which, there must be 
 always a sufficient amount ready, on demand. The deposites of the public 
 revenue, no doubt, enable the bank to extend its discounts to a certain decree; 
 but by no means to the degree that is alleged; besides, even permanent depo- 
 sites are of no further use to a bank than discounts are in demand. At pre- 
 sent, banks are so numerous as to be able to grant discounts on all good paper; 
 and a bank with a small capital is more productive, in proportion to that capi- 
 tal, than a large one; but not so safe a depository for the public revenue, nor 
 can it assist the Government in case of a sudden emergency. The honora- 
 ble gentleman considers the dangers anticipated from the sudden stopping of 
 the United States' Bank as mere bugbears, artfully promoted to influence the 
 question; and says he has heard much of them out of doors. He assures us 
 that the State banks, and abundant private capital in the country, are fully 
 equal to the crisis, so much so, that no such effects will be felt, as is pre- 
 tended, 
 
 Mr. F. said he was of a very different opinion. Even in countries where pri- 
 vate capital and bank stock was much more abundant than in this country, where 
 the great difficulty was to find profitable employment for money, the drawing 
 of a much less sum out of circulation than the stock of the Bank of the Unit- 
 ed States, was the cause of incalculable distress. From England, from which we 
 had learned, and might still learn, much, respecting money negotiations, many 
 examples to this purpose might be produced. He would only mention one. In 
 1793, while the national bank of England was in full credit, and issued specie 
 on demand, some of the usual channels of trade being stopped by the war, 
 several private banks and commercial houses stopped payment. So much be- 
 ing withdrawn from the usual channels of circulation, spread distress over the 
 whole nation, and its effects were felt in this country and throughout the com- 
 mercial world. The pressure was too great for even the Bank of England to 
 relieve it. A general bankruptcy was so much apprehended, that the govern- 
 ment was under the necessity of interposing, and issued five millions, to be 
 lent on the credit of deposites of merchantable goods, and on moderate inter- 
 est. Half this sum, however, supplied the vacuum of the circulating medium, 
 and retrieved credit and confidence; the other half never was called for. 
 This instance is selected, because it is believed to be within the knowledge and 
 recollection of every one who even read the newspapers but seventeen year ago. 
 
 He said that, if the paper in circulation, on the credit of the ten millions 
 of dollars of bank stock, were suddenly drawn out of circulation, the distress 
 occasioned thereby would be incalculable. All the aid that State or private 
 banks could give, Avould not prevent it; they would be distressed themselves, 
 and many of them stop. The d^nvMul for discounts, in specie, would be 
 
ON THE BILL TO RENEW THE CHARTER 
 
 stop business. The whole ten millions must be raised in specie; the paper of 
 other banks, as negotiable paper, will not do, at least for the $7,500,000 that 
 is to return to Europe. Tt is presumed this is too great a demand of specie 
 to be suddenly supplied. Besides these evils, it would lower the price of 
 produce from Georgia to New Hampshire, and occasion numerous bankrupt- 
 cies, and would even affect our public credit, by disabling the merchants to 
 pay their landed debt, and obliging such as possess funded stock to send it to the 
 market, when there would be few to purchase. Mr. F. said he was as con- 
 fident that such would be the consequences of suddenly withdrawing the 
 stock of the Bank of the United States, as he could be of any causes pro- 
 ducing their natural effects. These consequences could only be lessened by 
 the assistance or moderation of the stockholders. He mentioned an instance 
 within his own knowledge, which, though comparatively small, applied to the 
 case, A number of French royalists, who took refuge in Philadelphia, being in 
 expectation of a counter revolution^ would not vest their money in bank or 
 public stock, but had it lent on broker interest, atone per cent a month; it had 
 before been two per cent. In the mean time, Congress brought forward the 
 alien law, and the emigrants not knowing who would be sent out of the coun- 
 try, suddenly, under that law, called in their money, which, notwithstanding 
 the assistance of the banks, soon raised the broker's interest from one to four per 
 cent, a month. 
 
 For these reasons, and others that might be mentioned, he was in favor of 
 the general principles of the bill, and against the amendment. He had in- 
 tended not to detain the House long, therefore, he would not discuss the de- 
 tails of the bill. He supposed they might be much improved, in the passage of 
 the bill, by improving the details. 
 
 The committee then rose, reported progress, and were refused leave to sit 
 again; consequently, no decision was had on Mr. LGVK*S motion to strike out 
 the first section. 
 
 APRIL 21, 1810. 
 
 The proviso moved by Mr. TROUP, to be stricken out of the bill, (see page 
 135 ante) was that which required the bank to pay, as a bonus, for the re- 
 newal of its charter, into the treasury of the United States, $1,250,000. On 
 this motion the following debate took place, between Mr. Tnorp, Mr. TAY- 
 LOR, Mr. SMILIE, and Mr. KEY: 
 
 After some discussion of the details of the bill, 
 
 Mr. TROUP said gentlemen might pass the bill, but for the constitutional 
 question. If they did pass it, he hoped they would not permit themselves to 
 become the retailing hucksters of the community, for the sale of bank 
 charters. In the name of common honesty, said he, I beseech you, what 
 power have you to sell a charter? There is a power in the constitution to sell 
 the public property; but there is certainly no power to sell privileges of any 
 kind. I therefore move you to strike out the bribe, the douceur, aad the bo- 
 nus, as gentlemen call it, of 1,250,000 dollars. 
 
 Mr. TAYLOR said that, with respect to the principle of the Government's 
 receiving a bonus for this monopoly, (for he said it unquestionably was a mo- 
 nopoly) those who were disposed to continue this charter justified their con- 
 clusion from the instrument under which they acted under that clause which 
 says that Congress shall have power to pass all laws necessary and proper to 
 carry into effect the powers granted. If (said Mr. T.) one banking institu- 
 tion be necessary and proper, and answers the purpose of aiding us in the 
 temporary loans it may be found advantageous to indulge in, and we act un- 
 der these terms, when we have fufilled those terms, and created an institu- 
 tion coming up to the definition of necessary and proper, the power then 
 ceaspfi. 1 his being a monopolizing institution, being so although a handmaid 
 
468 BANK OF THE UNITED STATES. 
 
 to the Government, it was deemed fair, acc9rding to the principles of national 
 justice, that they should pay to the community, and to the People of the Unit- 
 ed States, an equivalent for that advantage, and this decision of the commit- 
 tee was justified not only by the example of other governments, (for gentle- 
 men have quoted instances in which the bank of England has given a bonus for 
 the extension of its charter) but by the practice of the different States: for 
 it has been uniformly the practice of some States to receive a bonus from 
 these monopolizing institutions. Unquestionably, if benefit conferred requires 
 a return in value, it is right and proper that the Government should exact 
 from that monopolizing institution a bonus. But, sir, this course is not only 
 justified by the practice of the State Governments, but by the practice of the 
 republican administration of Mr. Jefferson. The Government of the United 
 States possessed a number of shares in the Bank of the United States, each 
 representing, as each of these does, four hundred dollars; yet, that adminis- 
 tration transferred this paper at an advanced price. If the principle of dis- 
 posing of these shares be correct, it will equally apply to all the shares in the 
 institution. What right had the Secretary of the Treasury, or person acting 
 for him, to demand forty-five per cent, above the real specie capital for the 
 bank stock? In transferring the stock, did not the Government, on that oc- 
 casion, receive a bonus? Unquestionably they did. If they receive a bonus, 
 as to some shares, can they not, with equal honesty, receive it as to the whole 
 number of sharesr 
 
 But, it does not require refinement to justify the course which it is propos- 
 ed to pursue. The thing is worth something. You are offered something 
 for it. There is no oppression in it. If you could, at once, put in requisition, 
 so much money of the stockholders, and put it in the pockets of the United 
 States, it would be oppression. But, here is a u fair choice offered to them, 
 whether they will take the charter, giving a bonus for it, or reject it. It is 
 perfectly a matter of choice; and, from the arguments of some gentlemen op- 
 posed to the bill, so far from being unwilling to give so much, it would seem 
 that the stockholders ought to give much more for the renewal of the charter. 
 I am desirous to receive a quid pro quo. The arguments about foreign stock- 
 holders have had so much effect on me, that I would not continue this institu- 
 tion, unless Government received a benefit from it. It is unquestionably 
 true, that the habits, customs, manners, and decisions of nations have esta- 
 blished a common course of proceeding on this subject, and we must act ac- 
 cording to custom. We now value a dollar at so much, and a piece of iron 
 at so much. The custom of nations has given a sort of common law control 
 over these institutions, and we must act with them as other nations do. I do 
 not consider it a " bribe" that I or the Government are about to receive. On 
 the contrary, I think it a fair bargain. There seems to be no disposition to 
 abate a farthing, but to have the value arid nothing less. I do not wish to 
 have more. The provisions of this bill, with some amendments, will give the 
 transaction a character of perfect fairness. 
 
 Mr. SMILIE said, that, on this question he differed materially from his 
 friend on his left. The word "bribe" was not applicable to the bargain now 
 about to be made. 1 take it for granted (said he) there is but one ground on 
 which the Legislature is justified in granting a monopoly; and that is, that it 
 is necessary in the operations of the Government. If that be the case, we 
 certainly have a right, in granting that monopoly, to make the best bargain for 
 our own interest which we can, always remembering that we consider the 
 thing necessary and proper in itself. As that is my opinion, I think it a fair 
 transaction, in making the bargain with the company, to obtain as great ad- 
 vantage to the Government as the justice of the case will admit; and this is 
 a thing we have done before. It will be recollected, when the State of Ohio, 
 then a territory, was made a State, we found it very inconvenient to the Go- 
 vernment that they should possess the power of taxing our lands. We made 
 a proposition to them, that, if they would not tax our lands for a certain num- 
 ber of years, we would do certain other things. The bargain took place. 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 459 
 
 We have derived an advantage from it, at the same time that we paM them a 
 price for it. The consequence fairly follows, that we ought to grant this ne- 
 cessary charter on such terms as are just, both with respect to the country 
 and the Government, and derive as much advantage as we can from it. 
 
 Mr. THOUP said he forebore, at present, going into the question of consti- 
 tutionality. He had no idea that he could, with any efficacy whatever, stand 
 up on this floor, with such a weapon as an argument, to contend with a mo- 
 neyed institution of ten millions. If I am not disposed to go into the general 
 question of constitutionality, said he, lamas certainly indisposed to derive 
 this power from the power to pass all laws necessary and proper. I am the 
 more reluctant to do so, because it is a dangerous power, and ought not to be 
 derived by implication. I say that the power is dangerous: for, if it be con- 
 ceded that the Congress of the United States have a n^ht to erect a moneyed 
 institution, with a capital of ten or twenty millions, it is competent to erect 
 one with a capital of a hundred millions. It may be competent, therefore, to 
 the United States to raise a corporation more powerful than itselfa moneyed 
 institution which may absorb all the powers of the State- And this principle, 
 as a precedent, will be the more dangerous, in this case, because the tempta- 
 tion is so much greater, in proportion to the amount of capital. I do contend, 
 that, if the constitution did intend to grant the power of chartering moneyed 
 institutions, it did not intend to grant it for the purposes of speculation, and 
 of speculation merely. Sell privileges! Sell for 1,250,000 dollars the exclu- 
 sive privilege of taking usurious interest on money! I thought, sir, that the 
 power of selling privileges and indulgences was exclusively the right and 
 power of the Pops*. I ask gentlemen on what authority they act? On none 
 of morality, certainly but on what authority? On that of the corrupt go- 
 vernment of England. Servile imitators of England, we must have a national 
 bank! And why not an East India company? We could sell a charter to- 
 morrow for millions. We could sell chartered privileges for almost as much 
 as we should choose to ask. If wo. become the retailers of privileges, we 
 shall go on to sell them till we overdo the business; and when this great na- 
 tional source of revenue, after becoming our chief and only resource, had 
 failed, to what resources for reveuue should we be driven? Is it not a very ra- 
 tional inference, that it will be to the sale of all privileges we can derive from 
 the constitution a power to dispose of? If, sir, on any occasion, you would 
 set up in the market privileges for sale to the highest bidder, even do so with 
 respect to privileges of every description. You would no more hesitate to set 
 up for sale privileges of nobility than this privilege; but. (I thank my God!) 
 the constitution has prohibited you. But for that, you should sell them now 
 as we do bank privileges; we should go on to make it our chief resource, till, 
 by the cheapness of the title, we should destroy the value of the trade. If 
 we can draw money into the treasury by bargain and sale of privileges, let 
 it be understood that we will continue to foster it as our chief national re- 
 source. Having done with internal and direct taxes of all descriptions, be- 
 cause we considered them oppressive, this sale of privileges will be made the 
 chief national resource. 
 
 1 will add but one thing. The moment you accept this 1,250,000 dollars, 
 you are bribed in the same manner as the British Parliament have suffered 
 themselves to be corrupted. Like them we not only shamefully partake of 
 the crime, but on our statute book acknowledge the lact. 
 
 Mr. KEY said that to him it clearly appeared within the power and limit 
 of the constitution to establish a bank, if necessary, for the collection of the 
 revenue. Whether necessary or not, (said he) is a question on which gen- 
 tlemen must make up their minds; it would be only an unnecessary waste 
 of time to argue it at length. My ideas on this subject, which I have never 
 before delivered to the House, are plain and simple. I know not how 
 far they may appear so to others; but 1 will explain them as they occur to me. 
 
 We need not look to the constitution always for precise terms to justify an 
 
470 BANK OF THE UNITED STATES. 
 
 exercise <f power, because it is but an enumeration of first principles. All 
 we have to do is to examine whether, in what we do, we fall within the plain 
 meaning of (he constitution. In the enumeration of specific powers given to 
 Congress by this instrument, the first is to lay and collect taxes. Here is a 
 clear, unequivocal grant of power to lay taxes, imposts, and excises. In 
 construing the general power, afterwards given, to make all laws necessary 
 and proper, &c. the sound construction is to refer to the powers previously 
 given; one of which is, as I have stated, to lay and collect taxes. The mode 
 by which they are collected is not designated in the instrument. We have 
 authority given us to make all laws necessary and proper to carry these 
 powers into effect. The power of laying and collecting taxes is specifically 
 given; but the mode is not stated. To collect is not merely the individual 
 receipt, but the substantial collection into the treasury. It does not simply 
 give power to the collector of a port to receive the revenue, but a power to 
 collate the revenue into a general deposite or focus. Is, then, a bank institu- 
 tion necessary, in the judgment of gentlemen, to draw together, with greater 
 facility and less cost, these taxes? If there are those who think so, we can 
 be at no loss to find express authority for it. We have a right to lay the 
 taxes the manner of levying or collecting them is not prescribed; and when 
 lodged in the hands of the different collectors, ho w they are to come into the 
 common exchequer is no where described. Is the instrumentality of a bank 
 necessary for the more speedy and less expensive collection of the revenue? 
 If it be, all who think so are, in my opinion, constitutionally justified in 
 voting for a bank. 
 
 In all this, I say nothing of the opinion of learned men on the subject. The 
 act for establishing a bank was suspended some time for consideration, 
 before it received the signature of Washington. It has been considered con- 
 stitutional by all the States: for I believe I may say that the States, without 
 exception, have given legitimacy to the paper issued by the institution. If it 
 was originally unconstitutional, and the paper was not capable of going 
 abroad, every man punished for counterfeiting United States' bank notes, 
 has suffered unjustly; because, in that case, Congress having no right to create 
 the charter of a bank, had no right to punish the forgery of its paper. 
 
 I say nothing of the stability of this institution, and of its utility in collecting 
 the revenue. If, after the lapse of twenty years, various acts have been done, 
 proceeding on the constitutionality of the law establishing the bank, I consider 
 the subject one which has been so acted on, that, whatever obstacles are 
 opposed on the ground of constitutionality, should now be done away. But, 
 laying this consideration aside, all those who believe that a bank is a speedy, 
 safe, and economical mode of collecting money into the treasury, must find 
 authority for it in the constitution. To have given the power to collect taxes, 
 and not the best means of getting them into the treasury in the most correct 
 manner, would, indeed, have been an extraordinary feature in the constitution; 
 it would have been giving the end without the means to attain it. It would 
 be giving a forced construction to the constitution to say that it had done so. 
 
 1 know that gentlemen think the collection of the revenue would be as well 
 accomplished through the State banks. Those who think so justify their 
 opinion only on reasons which, to my mind, show the constitutionality of the 
 United States' Bank, and prove that we have authority to use that instrument, 
 if we think proper, and deem it the most eligible. We are the grantors of 
 power. By whom is it executed? Through the instrumentality of individuals 
 and their funds. In using the instrument, we do create a benefit to the indi- 
 viduals, who, together with their friends, must be employed. For this benefit 
 I can see nothing improper in receiving adequate compensation. And if it be 
 a grant of a benefit, why not grant it to those who will give an equivalent 
 for it? 
 
 Sir. the constitution grants to Congress the power to secure to inventors of 
 useful arts the exclusive right to their discoveries. We must not be misled 
 by language or words. We sell privileges every day. Does not our treasury 
 receive benefits from the sale of these patents? And yet, according to the 
 
ON THE BILL TO RENEW THE CHARTER OF 1791. 47 J 
 
 ideas of the gentleman from Georgia, we thus become the hucksters of privi- 
 leges. But lest the gentleman should not think that this case applies very 
 strongly, I will call to mind a remarkable case I know not how the gentle- 
 man voted on the law. AVe have incorporated a number of gentlemen to 
 build a bridge across the Potomac, reserving asa bonus for this privilege, the 
 free passage of all armies, military munitions, &c. of the United States; 
 which was exactly the same thing as receiving so much money. The Govern- 
 ment is a body politic; its operations must be carried on by individuals; and 
 when individuals, incorporated for the purpose of receiving revenue, who 
 use their hands and eyes in the business, receive too much emolument, I see 
 nothing improper in requiring from them an equivalent in lieu of it. I hope, 
 therefore, this part of the bill will not be struck out. 
 
 Mr. TROUP observed, that the gentleman has said, that the power to incor- 
 porate a bank was derived from the power to lay and collect revenue; and 
 that the power ought to be exercised, because banks give a facility to the 
 collection of the revenue. If the power be exercised, it must be necessary 
 and proper. If it be necessary to the collection of the revenue, the revenue 
 cannot be collected without it. The gentleman from Maryland might say a 
 bank institution was useful. He migHt say it would give facility to the col- 
 lection of the revenue; but facility and necessity are wholly different; and 
 the constitution says, that a power, to be incidental, must be necessary and 
 proper. If facility be a ground of action, we are greatly wide of the true 
 policy. AVe ought to adopt that measure which shall give the greatest facility. 
 The ingenious gentleman himself could sit down, and in fifteen minutes 
 devise half a dozen modes which would give infinitely more facility than a 
 bank, to the collection of the revenue. He might farm out the revenue; 
 establish farming districts; put a farmer general at the head of them, with a 
 corps of janissaries. The Secretary of the Treasury would have nothing to 
 dp but draw on him for a sum of money, and require it, or his head. This, 
 sir, is a plan which would give the greatest possible/aa/t/i/. You could com- 
 mand money of the farmer general, or you could require his head. Himself 
 and his janissaries could always send the money; or, if he did not, the People 
 and the janissaries could send his head. 
 
 The motion of Mr. TROTP was rejected, by a vote of 35 for striking out, 
 and 75 against it. 
 
 
CHAPTER IV. 
 
 ON THE VARIOUS PROJECTS FOR A NATIONAL BANK, IN THE YEARS 1814 ANP 
 1815, DURING THE THIRTEENTH CONGRESS. 
 
 &&***} HOUSE OF REPRESENTATIVES. 
 
 JANUARY 4, i14. 
 
 Mr. LEFFERTS presented a petition, signed by one hundred and fifty in- 
 habitants of the city of New York, praying that an act may be passed to in- 
 corporate a National Bank, with a capital of thirty millions of dollars. 
 
 Read, and referred to the Committee of Ways and Means.* 
 
 JANUARY 10, 1814. 
 
 Mr. EPPES, from the said committee, made the following report; which was 
 referred to a committee of the whole House on the state of the Union: 
 
 The Committee of Ways and Means, to whom was referred the memorial 
 af sundry inhabitants of the State of New York, praying for the establish- 
 ment of a National Bank, report: 
 
 That the power to create corporations within the territorial limits of the 
 States, without the consent of the States, is neither one of the powers dele- 
 gated by the constitution of the United States, or essentially necessary for 
 carrying into effect any delegated power. 
 
 FEBRUARY 4, 1814. 
 
 Mr. CALHOUN, of S. C. moved that the committee of the Whole be dis- 
 charged from the further consideration of the report of the Committee of Ways 
 and Means, on the petition from New York for the establishment of a Na- 
 tional Bank, and that the same be recommitted to the same committee, with 
 a view of making a further motion on that subject. Agreed to. 
 
 Mr. CALHOUN then said that it would be found that the Committee of 
 Ways and Means had decided against that report, on the ground of uncon- 
 stitutional ity of establishing such a bank as that asked for in the petition. 
 Mr. C. vyished to instruct the committee to inquire into the expediency of 
 establishing a National Bank, within the District of Columbia, the power to 
 do which, it could not be doubted, came within the constitutional powers of 
 Congress. For all practical purposes, he believed, such a bank would be as 
 useful as that which was proposed. To come at his object. Mr. C. proposed 
 the following motion: 
 
 Resolved. That the Committee of Ways and Means be instructed to in- 
 quire into the expediency of establishing a National Bank, to be located in the 
 District of Columbia. 
 
 The resolution was agreed to without opposition. 
 
 * The said committee consisted of Messrs. Eppes, of Virginia, Taylor, of N. Y. 
 Roberts, of Pennsylvania, Creig-hton, of Ohio, Alston, of North Carolina, McKim, of 
 Maryland, and Cox, of N. J. 
 
PROCEEDINGS OF 1814, 473 
 
 FEBRUARY 19, 1814. 
 
 Mr. TAYLOR, of New York,'from the Committee of Ways and Means, re- 
 ported a bill to incorporate the stockholders of the National Bank. It pro- 
 posed the establishment of a bank, with a capital of thirty millions ot dollars, 
 in the city of Washington, and named a number of persons, some ot whom 
 are of that city and Georgetown, to act as Directors until others were ap- 
 pointed. 
 
 The bill was twice read and committed 
 
 MARCH 10, 1814. 
 
 Mr. FISK, of New York, rose to make a motion, which he said he had in 
 contemplation ever since he examined the provisions of the bill reported by 
 the Committee of Ways and Means for the establishment of a National Bank. 
 Whatever might be his opinion as to the expediency of a bank for national 
 purposes, he did not know that this was the proper moment for erecting sue 
 an institution, because, when Congress had just authorized the sale ot stock 
 to the amount of twenty-five millions, it would certainly be inexpedient to 
 create a demand for so large an amount of other stock. But, if it was expe- 
 dient, or whenever it shall be, every one who had read the bill must perc 
 that a bill containing such provisions would not, could not pass. He, there- 
 fore, moved " that the committee of the whole to whom is referred the bill 
 to incorporate the stockholders of the National Bank be discharged from the 
 consideration thereof, and that it be referred to a select committee, with in- 
 structions to report a bill to establish a National Bank, with provisions tor 
 branches." 
 
 Mr. SEYBERT. of Pennsylvania, said he was opposed to this motion. He 
 thought it would be highly improper, if it was referred to a committee at all, 
 to refer this subject to a select committee, when it properly belonged to the 
 standing committee, to which was referred all subjects relating to the Ways 
 and Moans, and to the credit of the Government. Mr, S. related the course 
 this subject had taken during this session. In the first instance, it had been 
 introduced into the House by a petition from the citizens of New York, which 
 was referred to the Committee of Ways and Means; that committee had re- 
 ported that, in their opinion, it was not constitutional to establish branches 
 in the States. It was now proposed again to refer this question to a commit- 
 teefor what? To inquire into the expediency of establishing a bank, with 
 branches, against which so pointed a report had already been made. What 
 could the gentleman promise himself from this course? Nothing but defeat. 
 The question was one of considerable magnitude, which there was, during this 
 session, no time to investigate. Mr. S. said he had been, and should be, op- 
 posed to the bill; and, on a former occasion, several of the States had de- 
 clared their opposition to such a proposition. To keep the question before 
 the House would do an injury to the nation, in regard to its public stock. 
 There were men here who were highly interested in the fate of this question, 
 and who, during its agitation, would doubtless dissuade their friends from 
 embarking in the loan. He hoped this motion would not prevail, but that the 
 bill now before the House would be taken up at a proper time, and heard on 
 its merits. 
 
 ^ Mr. EPPES, of Virginia, stated the course this question had taken in the 
 Committee of Ways and Means. When the question was referred to them, 
 they had decided against the constitutionality of the measure as then pro- 
 posed; and, as so much argument had heretofore taken place on the subject, 
 they thought it would be better now to place the naked question before the 
 House, to enable them to decide, in the first instance, whether the constitu- 
 tion did vest m Congress the power to establish a National Bank. This re- 
 port of the Committee of Ways and Means was referred to a committee of 
 the whole; but, by discharging that committee from the further considera- 
 60 
 
474 BANK OF THE UNITED STATES. 
 
 tion of the report, and referring it back to the Committee of Ways and Means? 
 with particular instructions, the House had waived the constitutional ques- 
 tion, and directed an inquiry into the expediency of establishing a bank with- 
 in the District of Columbia. A majority of the committee believed it would 
 be expedient, though he himself did not think so, and did not agree to the 
 report. If the gentleman was disposed to try the question of establishing 
 branches to the bank, it would be easier to do so by engrafting a proposition 
 to that effect on the present bill. It would be better, if recommitted, how- 
 ever, that the bill should be referred to a select committee, and not to the 
 Committee of Ways and Means, who had already expressed their opinion on 
 the subject. 
 
 Mr. FISK said he did not know that the question could be acted on at the 
 present session, but that was one of the points he wished to be inquired into.. 
 The question was of so much importance, that he wished it to be examined 
 in all its bearings; and, if it could not be acted on at the present session, that 
 the public opinion on it might be concentrated before the next. The agita- 
 tion of this question, he presumed, would not create any difficulty in pro- 
 curing the loan, when it was recollected that every Legislature in the Union 
 almost was principally engaged during its sessions in establishing new banks. 
 He thought the establishment of a great bank would rather have a tendency 
 to check the extravagant issue of paper, and, if he might be allowed the ex- 
 pression, to bring the community to its senses. It had been said that, though 
 the incorporation of a National Bank was unconstitutional, yet it might be 
 established in this District, where Congress possess exclusive jurisdiction. 
 He said he should be alarmed by such a construction, if it were to prevail, 
 that Congress might, within this District, do the most unconstitutional acts. 
 Such a bank was certainly not necessary for the use of the people within this 
 District. To establish such a bank, with this view, would be as preposterous 
 as it would be to build fifty sail of the line, under a pretence of protectingthe 
 city by sailing along the canal which runs through it. There was in the Dis- 
 trict as much natural capacity to employ the one as the other. In regard to 
 the principle of exclusive legislation in the District, Congress had decided it 
 not to exist in the extent now contended for, when they acquiesced in the 
 views of the President in puting his veto to the bill for incorporating a church 
 in the town of Alexandria, because of the unconstitutional connexion of reli- 
 gion with the powers of the Government. A very cursory view of the bill 
 now before the House would show that it was not intended for the use of the 
 good people within the District, because so few of the directors were located 
 within it. Mr. F, adverted to other objectionable features of the bill, by way 
 of proving that, if a National Bank was necessary, this bill was not calculated 
 to answer the object, &c. 
 
 Mr. TAYLOR, of New York, made a few observations on the propriety of 
 acting on this subject speedily. Though he had reported this bill, it was not 
 a favorite project,- he was in favor of reporting a bill with very different pro- 
 visions, but a majority had overruled him, and decided that it was not con- 
 stitutional to establish a bank with branches, &c. 
 
 Mr. ALSTON, of North Carolina, observed, that gentlemen might obtain 
 their object without recommitting the bill, by moving a resolution, and ob- 
 taining a vote thereon, that it was, or was not, expedient to establish a bank 
 with branches. 
 
 The question was taken on Mr. FISK'S motion, and decided in the ne- 
 gative. Ayes 36. 
 
 And the House adjourned. 
 
 [It does not appear that any farther action took place on the bill reported 
 by Mr. TAYLOR. This was the first of the abortive attempts that were made, 
 during the thirteenth Congress, to establish a National Bank. ] 
 
PROCEEDINGS OF 1814 475 
 
 APRIL 2, 1814. 
 
 Mr. GRUNDY, of Tennessee, submitted the following resolution for consider- 
 ation : 
 
 Resolved, That a committee be appointed to inquire into the expediency of 
 establishing a National Bank; and that they have leave to report by bill or 
 otherwise. 
 
 nitely. He said that, by this motion, he meant not the slightest disrespect to 
 the mover of the resolution; but feeling, as he did, a firm conviction that the 
 constitution had not given to Congress the power to establish such an institu- 
 tion, the correctness of which opinion had been tried and settled by a former 
 Congress, he could not consent to the adoption of the resolution. Besides, 
 said Mr. N., the session is now drawing to a close; the day of adjournment 
 has been fixed by a vote of this House; and the mind of every member is 
 anxiously directed to the moment which is to restore him to his family and 
 home. The time is now too short for the consideration of so important a sub- 
 ject; and for this, as well as the intrinsic objections he had to the object of 
 the resolution, he hoped his motion to postpone it indefinitely would prevail. 
 
 Mr. GRUNDY said he trusted the motion to postpone would not succeed. 
 He believed there was time enough left for the consideration of the subject; 
 and if the House would bring itself to discuss it, all constitutional difficulties, 
 he was persuaded, would be removed. The gentleman from Virginia, by his 
 motion to postpone, would bring the subject at once before the Housej but it 
 would be much better to refer the inquiry to a committee, let them investi- 
 gate the question thoroughly, and report the result to the House, and they 
 would then be enabled to act understandingly. Besides, said Mr. G., the 
 gentleman has opposed the resolution, without knowing what kind of a bank 
 is contemplated, or upon what principles, or in what manner, it is to be esta- 
 blished. Let the matter be referred to a committee; it will then come regu- 
 larly before the House, and every member will know how to act. 
 
 Mr. GROSVEXOR, of New York, said he had always believed it improper for 
 the General Government to legislate in erecting banks, except so far as to ac- 
 complish national objects, facilitating the collection of the revenue, &c. As 
 to these objects, however, it was the constitutional duty of the Secretary of 
 the Treasury to devise the ways and means, and if sucn an institution were 
 necessary for the purposes of Government, it was the duty of that officer to 
 recommend it. He wished the Secretary to say whether such a bank was 
 necessary, and not that the subject should be referred to a committee of this 
 House, and they to inquire privately of the Secretary as to the expediency of 
 the measure. When the proposition came in at the proper constitutional door, 
 and appeared to be necessary for the financial purposes of the Government, 
 he should not object to it. If such a necessity exists, he wished the Govern- 
 ment to come forward and declare it, and not shrink from the responsibility 
 of recommending the measure. 
 
 Mr. FINDLEY, of Pennsylvania, made a few remarks, not distinctly heard. 
 He was understood to say, the erection of a bank was not so desirable on ac- 
 count of the Government, as for the general convenience of the country. 
 
 Mr. OAKLEY, of New York, made a number of forcible remarks against the 
 indefinite postponement. He said he did not believe it was so exclusively 
 the duty of the Executive department to recommend the establishment of a 
 National Bank, even if required by the finances of the Government, as his col- 
 league (Mr. GROSVENOR) seemed to think. He had no doubt that a National 
 Bank was indispensable to the proper management of the fiscal affairs of Go- 
 vernment; but, independent of this consideration, he believed it was necessary 
 to the general convenience of the community; and should a plan for such an 
 
476 BANK OF THE UNITED STATES. 
 
 institution be brought forward in a shape that he approved, he should certain- 
 ly give it his support. Supposing, however, that it was the duty of the Secre- 
 tary of the Treasury to recommend a National Bank T and that he should be 
 unwilling to assume the responsibility, such conduct would doubtless be re- 
 prehensible, but would that be a good reason why Congress should decline to 
 establish an institution that would alike benefit the Government and promote 
 the general good? Mr. O. said that, although the proposition did not " come 
 in at the proper door," still it was no reason the House should refuse to act 
 on it. Whether this be a proper mode of establishing a National Bank, is 
 properly to be decided when the question comes before us in a regular form. 
 The question now turns only on our belief as to the expediency of such a 
 bank, and, if expedient, of the fitness of the time, &c. of incorporating such an 
 institution. He was therefore clearly of opinion, on general principles, that 
 the motion? for an indefinite postponement ought not to prevail. The ques- 
 tion of a national bank, he added, must be connected, from the very nature of 
 the institution, with the finances of the Government. But though he should 
 be as loath as any one to volunteer his aid to the administration, in support of 
 the war, yet he was not to be deterred by the fear of incidentally doing so from 
 doing what he believed to be of itself right and proper. It is our duty, said he y 
 to legislate for a settled state of things. A National Bank is necessary in my 
 judgment, to the permanent interest of the country, and therefore I am and 
 shall be in favor of it, if the details of the bill establishing it shall be such as to 
 meet my approbation. 
 
 Mr. WRIGHT, of Maryland, said he had heretofore voted a National Bank 
 unconstitutional | he was then satisfied it was so, and he believed that to be the 
 opinion of a great portion, if not a majority of the People. If so, why take 
 up the time ot the House, and consume two or three weeks in discussing a 
 question which may be determined at this moment? He could not consent to 
 spend the precious time of the House to no purpose, and being satisfied that 
 no National Bank could be passed through this House, he should vote for the 
 indefinite postponement of the motion. 
 
 Mr. WEBSTER, of New Hampshire, said this was a subject of great impor- 
 tance, and required mature consideration. The hour of adjournment having 
 arrived, he moved that the House do now adjourn. Negatived, 69 to 67. 
 
 Mr. NEWTON repeated, he had moved the indefinite postponement, assur- 
 edly not from any disrespect to the mover of the resolution, but on this 
 ground. The time rapidly approached, at which this House had resolved to 
 adjourn; but nine days remained of the session if the determination of this 
 House, in that respect, received the sanction of the Senate, and after so long a 
 sitting, every member must turn his eyes with pleasure to that moment. The 
 subject of a National Bank was one which had been discussed in the House 
 before, and in private circles, over and often; and he had not the least doubt 
 but every gentleman who heard him had made up his mind on the subject, 
 and that a year's discussion would not change it. He therefore thought it 
 would be best, in the first instance, to ascertain whether a majority was or was 
 not prepared to vote for such a measure. 
 
 Mr. GRUNDY then said, that he certainly should never have brought forward 
 this proposition, without having reflected much on it. He knew that it had 
 been agitated in this House, and in the nation, heretofore, and had been much 
 opposed by many of those politicians with whom he usually acted in this 
 House; but he did not believe that each Congress was so bound by the deci- 
 sions of that which preceded it, that it was a good argument against a measure 
 for members of a former Congress to come in and say, "we have decided it 
 heretofore." Asa representative, Mr. G. said he claimed the right to give at 
 least one vote on this subject, as well as the gentleman from Virginia. The 
 spirit of our constitution had wisely ordained the frequency of elections for the 
 very purpose of undoing what had been wrongly done by their predecessors, 
 and of doing that which had been lett undone- If the gentleman from Virgi- 
 nia would reflect on this subject as much as others, who had been instrumen- 
 
PROCEEDINGS OF 1814 477 
 
 tal in bringing forward the proposition, he was sure he would not be so con- 
 fident that he acted correctly in refusing a deliberate consideration to it. I 
 (said Mr. G.) have no secret on this subject: I wish to see a bank established 
 as a national object, let who will be in power: as a general measure I wish to 
 see it adopted. Look at the situation of our country and I say the gentle- 
 man should forget his home, and not leave his country in peril. You have 
 authorized a loan for twenty-five millions, and have provided for the expen- 
 diture of so much money. Where is the money? Some well informed men 
 say there will be no difficulty in obtaining it; others, as well informed, say, 
 that the attempt to obtain it may not be successful. I hope that gentlemen of 
 the former description are correct. I know not what the prospect is; but one 
 thing I do know I would run no hazard on this point; and for one, though I 
 have as much anxiety to be at home as anyone, I am willing to sit a few days 
 longer, to see how it will be. The gentleman from Virginia no doubt felt the 
 same anxiety for the public service; and Mr. G. said, if his constitutional 
 scruples were so great that he could not vote for this measure, in case the 
 money should not be conveniently obtained, it might be necessary to resort to 
 some other. For general consideration, Mr. G. said, he had always been in 
 favor of a measure of this sort; and he entertained no constitutional scruples, 
 about it. In point of time, he thought the present situation of the country 
 afforded a cogent argument in favor of the measure. 
 
 Mr. GASTON, of North Carolina, expressed his entire disapprobation of the 
 indirect introduction of Executive recommendations into the House, as pro- 
 ducing legislation without intelligence, and action without responsibility, &c. 
 If, therefore, the vote on this question were to test his approbation of this in- 
 direct mode of attaining a measure supposed to be in favor of the Executive, 
 he should certainly be inclined to vote against it. But, when a proposition 
 was made by any member of this House, which recommended itself to his best 
 judgment, on which he felt no constitutional scruples, and which he believed 
 to be at all times expedient, he could not give a direct vote against it, merely 
 because the Executive, if wishing its adoption, had not recommended it as 
 openly as could have been wished. That it is expedient to establish a Na- 
 tional Bank, he had no doubt, and he congratulated the House that, at the mo- 
 ment when gentlemen on his side of the House found some of their wishes 
 about to be gratified by the abolition of the restrictive system, the consti- 
 tutional scruples which had cramped the operations of the Government, were 
 vanishing also; that, at the moment when they were about to liberate com- 
 merce, the fetters would also be loosed with which a narrow constitutional 
 exposition had heretofore bound the Government. He should have been much 
 more pleased, he said, if the measure had been directly recommended by the 
 Executive, by an intimation that its adoption would conduce to a successful 
 management of our finances; but merely for the reasons that it had not come 
 before the House in that manner, he could not vote against a proposition, which 
 on general grounds, met his approbation. 
 
 Mr. NEWTON spoke in explanation. He was as ready as the gentleman 
 from Tennessee to yield, not only his time, but his personal service to his 
 country; and, had he but a dollar in the world, would freely lend it to con- 
 tribute to the support of the Government in a righteous war. But this ques- 
 tion could be decided as intelligently in a day as in a month; and, if a majori- 
 ty was opposed to it, it was not advisable to consume time unnecessarily upon 
 it. Under this impression he had made the motion for indefinite postpone- 
 ment, to ascertain the sense of the House on this point. 
 
 A motion was now made to adjourn, and carried by three or four votes. 
 
 APRIL 4. 
 
 The House resumed the consideration of the unfinished business of Satur- 
 day last, being Mr. GRUNDY'S motion to appoint a committee to inquire into 
 
478 BANK OF THE UNITED STATES. 
 
 the expediency of establishing a National Bank, with leave to report by bill 
 or otherwise. 
 
 Mr. NEWTON'S motion for indefinite postponement of this subject being 
 still under consideration 
 
 Mr. FARROW, of South Carolina, spoke against the postponement. He was 
 inclined to believe the establishment of a National *BanK to be both consti- 
 tutional and expedient; and should therefore vote against the postponement, 
 without saying how he should vote on the bill; because he did not know in 
 what form it would be reported. The want of time was no argument against 
 the discussion of this subject. None could be of more importance, or more 
 peremptorily requiring members to sacrifice personal convenience to the 
 public interest, &c. 
 
 Mr. HAWKINS, of Kentucky, supported the indefinite postponement. He 
 was against the proposition proposed to be postponed, if it was only because 
 the difficulties said to exist in procuring funds for the prosecution of the war, 
 were seized on to produce a change of principle. As to the difficulties which 
 were said to exist, he considered them in a ^reat degree imaginary, and their 
 reiteration as calculated to produce no beneficial consequences to the nation. 
 He did not believe the difficulties in question, if they existed at all, were such 
 as to require this House to sacrifice principle at the shrine of necessity. He 
 should, therefore, vote for the indefinite postponement, however, under other 
 circumstances, he might object to such a course of legislation because present 
 necessity was made the plea for obtaining that decision from the House, which, 
 under other circumstances, could not be obtained. 
 
 Mr. ROBERTSON, of Louisiana, opposed the postponement. He had heard 
 no one, in the course of this debate, advocate, a sacrifice of principle to the exi- 
 gency of the times. He did not know but the establishment ot a bank could 
 be amply supported on general grounds, distinct from the situation of the Go- 
 vernment, or from considerations of finance. He was happy that this was a 
 question trammelled by no party considerations; it was a question which con- 
 cerned commerce and commercial operations. Representing a distant but 
 highly commercial section of the country, which bid fair to equal, if not out- 
 strip any other part of the United States, in commercial importance, he felt 
 disposed, whenever in his power, to do any act, not contravening the consti- 
 tution, which would be beneficial to commerce. Those gentlemen who enter- 
 tained constitutional objections, would do well to vote against postponement, 
 because they could not be expected to yield them. Having himself no such 
 objection, and looking to the expediency of the measure only, he wished for 
 an opportunity of fair consideration to be offered to this subject 
 
 Mr. HAWKINS spoke in explanation. He said he should be always ready 
 to give a candid consideration to any proposition made in this House under or- 
 dinary circumstances. But this subject, he said, presented itself in an atti- 
 tude which did not entitle it to discussion by the House, because predicated 
 on a supposed difficulty which might be found in obtaining the loan already 
 authorised by law. Temporary expedients were not proper for such cases, 
 but measures of a more durable character- Therefore it was that he was in 
 favor of the indefinite postponement. Whenever the question should pre- 
 sent itself on principles unconnected with others of moment, and present im- 
 portance, he should not be found opposed to the investigation of it. 
 
 Mr. ROBERTSON added, that he considered this as an abstract proposition, 
 and so might the gentleman from Kentucky if he chose. Some gentlemen 
 supposed it had relerence to the immediate convenience of the Government, 
 and some might vote for it, and others against it, in that view; but they who'so 
 voted would vote from motives which Mr. R. said had no operation on him. 
 He did consider it as an abstract proposition, whether or not it was expedient 
 at this time to establish a national bank. 
 
 Mr. PITKIN. of Connecticut, said he should vote to postpone this proposi- 
 tion, because mere was already before the House a bill on the subject of a na- 
 
PROCEEDINGS OF 1814, 479 
 
 tional bank; and because he was opp9sed to taking up, at this late period of 
 the session, a subject which required, in acting on it, the greatest care and de- 
 liberation. 
 
 Mr.. POTTER, of Rhode Island, said he should vote for the postponement, 
 because no bill could be reported, on the subject of a national bank, that he 
 could vote for. The establishment of such a bank would answer no valuable 
 purpose to the community, and, by withdrawing from circulation, for six or 
 nine months, a vast amount of specie, would add to the distresses already ex- 
 perienced in the nation from the want of it, &c. 
 
 The question on indefinite postponement was then decided as follows: 
 Those who voted in the affirmative, are, 
 
 Messrs. 
 
 Alexander, 
 
 Messrs. Hanson, 
 
 Messrs. Newton, 
 
 
 Anderson, 
 
 Hawes, 
 
 Pickering, 
 
 
 Bard, 
 
 Hawkins, 
 
 Pitkin, 
 
 
 Baylies, of Mass. 
 
 Howell, 
 
 Pleasants, 
 
 
 Bigelow, 
 
 Hungerford, 
 
 Post, 
 
 
 Boyd, 
 Bradbury, 
 
 Ingersoll, 
 Irving, 
 
 Potter, 
 John Reed, 
 
 
 Breckenridge, 
 Brigham, 
 
 Johnson, of Va. 
 Johnson, ot Ky. 
 
 William Reed, 
 Rhea, of Ten. 
 
 
 Caperton, 
 
 Kennedy, 
 
 Ring^old, 
 
 
 Champion, 
 
 Kent, of N. Y. 
 
 Ruggles, 
 
 
 Ciller, 
 
 Kershaw, 
 
 Sharp, 
 
 
 Clark, 
 
 King, of Mass. 
 
 Sheffey, 
 
 ~ 
 
 Crawford, 
 
 T 
 Law ? 
 
 Stanford, 
 
 
 Davenport, 
 
 Lewis, 
 
 Stuart, 
 
 
 Desha, 
 
 Lovett, 
 
 Sturges, 
 
 
 Ely, 
 
 Lyle, 
 
 Troup, 
 
 -..- 
 
 Eppes, 
 
 Macon, 
 
 Vose, 
 
 
 Evans, 
 
 McKim, 
 
 Webster, _ 
 
 
 Geddes, 
 
 Miller, 
 
 Wheaton, 
 
 
 Gholson, 
 
 Moffitt, 
 
 Wilcox, 
 
 
 Goodwin, 
 
 Moseley, 
 
 Wilson, Mass. 
 
 
 Hale, 
 
 Markell, 
 
 Wright 71. 
 
 
 Hall, 
 
 Nelson, 
 
 
 Those who voted in 
 
 the negative, are, 
 
 
 Messrs. 
 
 Alston, 
 
 Messrs. Farrow, 
 
 Messrs. Lowndes, 
 
 
 Archer, 
 
 Findley, 
 
 McLean, 
 
 
 Barnett, 
 
 Fisk, ofVt. 
 
 Montgomery, 
 
 
 Bowen, 
 
 Fisk,ofN. Y. 
 
 Murfree, 
 
 
 Bradley, 
 
 Forney, 
 
 Oakley, 
 
 
 Brown, 
 
 Forsyth, 
 
 Ormsby, 
 
 
 Butler, 
 
 Franklin, 
 
 Parker, 
 
 
 Caldwell, 
 
 Gaston, 
 
 Pearson, 
 
 -V 
 
 Calhoun, 
 
 Gourdin, 
 
 Pickens, 
 
 
 Chappell, 
 Comstock, 
 
 Griffin, 
 Grundy, 
 
 Piper, 
 Rea, of Pa. 
 
 
 Condict, 
 
 Harris, 
 
 Rich, 
 
 
 Conard, 
 
 Hasbrouck, 
 
 Ridgely, 
 
 
 Cox, 
 
 Humphreys, 
 
 Robertson, 
 
 
 Creighton, 
 Crouch, 
 
 Ingham, 
 Jackson, of R. I. 
 
 Sevier, 
 Sherwood, 
 
 
 Culpeper, 
 Cuthbert, 
 
 Jackson, of Va. 
 Kent, ot Md. 
 
 Shipherd, 
 Skinner, 
 
 
 Davis of Pa. 
 
 Kerr, 
 
 Smith, of N. Y 
 
 
 Denovelles, 
 
 Kilbourn, 
 
 Smith, of Pa. 
 
 
 Duval, 
 Earle. 
 
 King, of N. C. 
 Lefferts, 
 
 Smith, of Va. 
 Strong, 
 
480 BANK OF THE UNITED STATES. 
 
 Messrs. Taggart, Messrs. Thompson, Messrs. Whitehill, 
 
 Talimadge, Uclree, Wilson, of Pa. 
 
 Tannehill, Ward, of Mass. Winter, 
 
 Taylor, Ward, of N. J. Yancey80. 
 
 Telfair, White, 
 
 So the House determined that Mr. GRUNDY'S motion should not be indefi- 
 nitely postponed. 
 
 Mr. HALL, of Georgia, then moved to amend the motion by adding, after 
 the word ""bank," the words "within the District of Columbia." 
 
 After a few words of objection by Mr. GRUNDY, who wished the motion 
 general ? to afford the committee a latitude of discretion as to the details of the 
 institution, and some observations from Mr. WRIGHT, in reply 
 
 Mr. HALL'S motion was negatived, ayes 32. 
 
 The question was then put on the adoption of the resolution, and decided 
 as follows: For the motion, 76. Against it, 69. 
 
 So the resolution was passed, and a committee of nine members directed to 
 be appointed, to carry it into effect. 
 
 Whereupon, Mr. Grundy, Mr. Oakley, Mr. Calhoun, Mr. Gaston, Mr. 
 Jackson, of Va. Mr. Lowndes, Mr. Ward, of Mass. Mr. Ingham, and Mr. 
 Fisk, of N. Y. were appointed the said committee. 
 
 APRIL 8, 1814. 
 On motion of Mr. GRUNDY, 
 
 Ordered, That the committee appointed to inquire into the expediency of 
 establishing a national bank be discharged from the further consideration of 
 that subject. 
 
 NOTE. No further proceedings on the subject took place during this ses- 
 sion of Congress. 
 
 HOUSE OF REPRESENTATIVES. 
 
 SEPTEMBER 21, 1814. 
 
 A Committee of Ways and Means was appointed, consisting of Mr. Eppes, 
 Mr. Fisk, of N. York, Mr. Archer, Mr. Oakley, Mr. Gaston, Mr. Creighton, 
 and Mr. Ingham. 
 
 SEPTEMBER 23, 1814. 
 
 Mr. FISK, of N. Y. presented a petition of sundry inhabitants of New York, 
 praying that an act may be passed to incorporate a National Bank. 
 
 Ordered, That the said petition be referred to the Committee of Ways and 
 Means. 
 
 OCTOBER 10, 1814. 
 
 The Committee of Ways and Means made a report on the subject of the 
 Finances of the Government, embracing five resolutions, neither of which, 
 however, contained any proposition respecting a National Bank. 
 
 The report was referred to a committee of the whole House. 
 
 OCTOBER 18, 1814. 
 
 Mr. EPPES, from said committee, laid before the House the copy of a letter 
 from the chairman to the Secretary of the Treasury, on the subject of main- 
 taining, unimpaired, the public credit, together with the answer of the Secre- 
 tary thereto; which were referred to the same committee of the whole House. 
 
PROCEEDINGS OF 1814. 
 The Commit tee of Ways and Means to the Secretary of the Treasury. 
 
 WASHINGTON, October 11, 1814. 
 
 8iR:^ ^ 
 
 The Committee of Ways and Means have had under consideration the 
 support of public credit, by a system of taxation more extended than the one 
 heretofore adopted. They have determined to suspend proceeding on their 
 report, at present before the House of Representatives, vyith a view to afford 
 you an opportunity of suggesting any other, or such additional provisions as 
 may be necessary to revive and maintain, unimpaired, the public credit. 
 
 JOHN W. KPPES, Chairman. 
 
 The reply of the Secretary is dated the 17th of October, 1814; it contains 
 the following suggestions in relation to the state of the currency, and a dis- 
 tinct proposition for the establishment of a national bank: 
 
 "The condition of the circulating medium of the country presents another 
 copious source of mischief and embarrassment. The recent exportations of 
 specie have considerably diminished the fund of gold and silver coin; and 
 another considerable portion of that fund has been drawn, by the timid and 
 the wary, from the use of the community, into the private cottiers of individu- 
 als. On the other hand, the multiplication of banks in the several States has 
 so increased the quantity of paper currency, that it would be difficult to cal- 
 culate its amount, and still more difficult to ascertain its value, with refer- 
 ence to the capital on which it has been issued. But the benefit of even this 
 paper currency, is, in a great measure lost, as the suspension of payments in 
 specie, at most of the banks, has suddenly broken the chain of accommoda- 
 tion that previously extended the credit and the circulation of the notes which 
 were emitted in one State, into every State of the Union. It may, in gene- 
 ra!, be affirmed, therefore, that there exists, at this time, no adequate circu- 
 lating medium common to the citizens of the United States. The moneyed 
 transactions of private life are at a stand, and the fiscal operations of the Go- 
 vernment labor with extreme inconvenience. It is impossible that such a 
 state of things should be long endured; but, let it be fairly added, that, with 
 legislative aid, it is not necessary that the endurance should be long. Under 
 favorable circumstances, and to a limited extent, an emission of treasury 
 notes would, probably, afford relief; but treasury notes are an expensive and 
 precarious substitute, either for coin or for bank notes, charged as they are 
 with a growing interest, productive of no countervailing profit or emolument, 
 and exposed to every breath of popular prejudice or alarm. The establish- 
 ment of a national institution, operating upon credit, combined with capital, 
 and regulated by prudence and good faith, is, after all, the only efficient 
 remedy for the disordered condition of our circulating medium. While ac- 
 compli shing*that object, too, there will be found, under the auspices of such 
 an institution, a safe depository for the public treasure, and a constant aux- 
 iliary to the public credit. But, whether the issues of a paper currency pro- 
 ceed from the national treasury, or from a national bank, the acceptance of 
 the paper in a course of payments and receipts, must be forever optional with 
 the citizens. The extremity of that day cannot be anticipated, when any 
 honest and enlightened statesman will again venture upon the desperate expe- 
 dient of a tender law." 
 
 " It is proposed that a national bank shall be incorporated for a term of 
 twenty years, to be established at Philadelphia, with a power to erect offices 
 of discount and deposite elsewhere, upon the following principles: 
 
 1. That the capital of the bank shall be fifty millions of dollars, to be di- 
 vided into 100.000 shares, of 500 dollars each. Three-fifths of the capi- 
 tal, being 60,000 shares, amounting to 30,000,000 of dollars, to be sub- 
 scribed by corporations, companies, or individuals; and two-fifths of the 
 
482 BANK OF THE UNITED STATES. 
 
 capital, being 40,000 shares, amounting to 20,000,000 of dollars, to be 
 biibscribed by the United States. 
 
 2. That the subscriptions of corporations, companies, and individuals, shall 
 be paid for in the following manner: 
 
 One-fifth part, or $6,000,000, in gold or silver coin. 
 
 Four-fifth parts, or $24,000,000, in gold or silver coin, or in six per 
 cent, stock, issued since the declaration of war, and treasury notes, 
 in the proportion of one-fifth in treasury notes, and three-fifths in six 
 per cent, stock. 
 
 3. That the subscriptions of corporations, companies, and individuals, shall 
 be paid at the following periods: 
 
 20 dollars on each share, to be paid at the time of subscrib- 
 ing, in gold or silver coin, .... $1,200,000 
 
 40 dollars on each share, 1o be paid in gold or silver coin, 
 
 one month after the subscription, . . . 2,400,000 
 
 40 dollars on each share, in two months after the subscrip- 
 tion, in gold or silver coin, .... 2,400,000 
 
 100 dollars, specie, $6,000,000 
 
 100 dollars on each share, in gold or silver coin, or in six 
 per cent, stock, or in treasury notes, according to the 
 preceding apportionment, to be paid at the time of sub- 
 scribing, . . . . . 6,000,000 
 
 150 dollars on each share, to be paid in like manner, in two 
 
 months after subscribing, .... 9,000,000 
 
 150 dollars o/i each share, to be paid in like manner, in 
 
 three months after subscribing, . . . 9,000,000 
 
 500 dollars, $30,000,000 
 
 4. That the subscription of the United States shall be paid in six per cent, 
 stock, at the same periods, and in the same proportions, as the payments 
 of private subscriptions, in stock and treasury notes. 
 
 5. That the United States may substitute six per cent, stock for the amount 
 of the treasury notes subscribed by corporations, companies, and indi- 
 viduals, as the notes respectively become due and payable. 
 
 6. That the bank shall loan to the United States $30,000,000, at an inter- 
 est of six per cent, at such periods, and in such sums, as shall be found 
 mutually convenient. 
 
 7. That no part of the public stock, constituting a portion of the capital of 
 the bank, shall be sold during the war; nor at any subsequent time, for 
 less than par, nor at any time to an amount exceeding one moiety, with- 
 out the consent of Congress. 
 
 8. That provision shall be made for protecting the banknotes from forgery; 
 for limiting the issue of bank notes; and for receiving them in all pay 
 ments to the United States. 
 
 9. That the capital of the bank, its notes, deposites, dividends, or profits, 
 (its real estate only excepted) shall not be subject to taxation by the 
 United States or by any individual State. 
 
 10. That no other bank shall be established by Congress, during the term 
 for which the national bank is incorporated. 
 
 11. That the national bank shall be governed by fifteen directors, being resi- 
 dent citizens of the United States and stockholders. The President of 
 the United States shall, annually, name five directors, and designate one 
 of the five to be the president of the bank. The other directors shall be 
 annually chosen by the qualified stockholders, in person or by proxy, it 
 resident within the United States, voting upon a scale graduated accord- 
 ing to the number of shares which they respectively hold. The cashier, 
 
PROCEEDINGS OF 1814, 
 
 and other officers of the bank, to be appointed as is usual in similar in- 
 stitutions. 
 
 12. That the directors of the national bank shall appoint seven persons, one 
 of whom to preside, as the managers of each office of discount and de- 
 posite, arid one person to be the cashier. 
 
 13. That the general powers, privileges, and regulations of the bank, shall 
 be the same as are usual in similar institutions; but with this special 
 provision, that the general accounts shall be subject to the inspection ot 
 the Secretary of the Treasury," 
 
 ik In making a proposition for the establishment of a national bank, 1 can- 
 not be insensible to the high authority of the names which have appeared in 
 opposition to that measure, upon constitutional grounds. It would be pre- 
 sumptuous to conjecture that the sentiments which actuated the opposition 
 have passed away; and yet it would be denying to experience a great practical 
 advantage, were we to suppose that a difference of times and circumstances 
 would not produce a corresponding difference in the opinions of the wisest, as 
 well as of the purest men. But, in the present case, a change of private opinion 
 is not material to the success of the proposition for establishing a national bank. 
 In the administration of human aftiurs, there must be a period when discussion 
 shall cease, and decision shall become absolute, A diversity of opinion may 
 honorably survive the contest; but, upon the genuine principles ot a represen- 
 tative government, the opinion of the majority can alone be carried into action. 
 The judge, who dissents from the majority of the bench, changes not his 
 opinion, but performs his duty, when he enforces the judgment otthe court, 
 although it is contrary to his own convictions. An oath to support the con- 
 stitution and the laws, is not, therefore, an oath to support them under all cir- 
 cumstances, according to the opinion of the individual who takes it, but it is, 
 emphatically, an oath to support them according to the interpretation of the 
 legitimate authorities. For the erroneous decisions of a court of law, there is 
 the redress of a censorial, as well as of an appellate jurisdiction. Over an 
 act, founded upon an exposition of the constitution, made by the legislative 
 department of the government, but alleged to be incorrect, we have seen the 
 judicial department exercise a remedial power. And, even if all the depart- 
 ments, legislative, executive, and judicial, should concur in the exercise of a 
 power, which is either thought to transcend the constitutional trust, or to 
 operate injuriously upon the community, the case is still within the reach of 
 a competent control, through the medium of an amendment to the constitu- 
 tion, upon the proposition, not only of C'ongros. but of the several States. 
 When, therefore, we have marked the existence of a national bank for a period 
 of twenty years, with all the sanctions of the legislative, executive, and judi- 
 cial authorities; when we have seen the dissolution of one institution, and 
 heard a loud and continued call for the establishment of another; when, under 
 these circumstances, neither Congress nor the several States, have resorted 
 to the power of amendment; can it be deemed a violation of the right of pri- 
 vate opinion, to consider the constitutionality of a national bank as a ques- 
 tion forever settled and at rest? 
 
 But, after all, 1 ,-hould not merit the con{idence ? which it will be my am- 
 bition to acquire, if I were to suppress the declaration of an opinion, that, in 
 these times, the establishment of a national bank will not only be useful in 
 promoting the general welfare, but, that it is necessary and proper for carry- 
 ing into execution some of the most important powers constitutionally vested 
 in the Government. 
 
 Upon the principles and regulations of the national bank, ji may be sufli- 
 cient to remark, that they will be best unfolded in the form of a bill, which 
 shall be immediately prepared. A compound capital is suggested, with a de 
 sign equally to accommodate the subscribers, and to aid the general measures 
 for the revival of public credit; but the proportions of specie and stock may be 
 varied, if the scarcity of coin should render it expedient; yet, not in so great 
 a degree as to prevent an early commencement of the money operations of the 
 institution." 
 
484 BANK OF THE UNITED STATES. 
 
 OCTOBER 81, 1814, 
 
 The House resolved itself into a committee of the whole, on the foregoing 
 report and letters, and made some progress therein. And, on the 22d, Mr. 
 NELSON, from the said committee, reported that the committee had again had 
 the said report and letters under consideration, and had made certain amend- 
 ments to the first and second resolutions contained in the report, which they 
 had directed him to report to the House, ami ask leave to sit again upon the 
 residue thereof. 
 
 OCTOBER 24, 1814. 
 
 The House proceeded to consider the above report of the committee of the 
 whole House, and the question was stated, to concur with the said committee 
 in their amendments to the said first and second resolutions: 
 When, on motion of Mr. EPPES, 
 
 Ordered, That the said first and second resolutions do lie on the table, and 
 that the committee of the whole House have leave to sit again to-day, on the 
 residue of said report and letters. 
 
 The House, afterwards, resolved itself into a committee, and Mr. PITKIN 
 reported that the committee had again had the said report and letters under 
 consideration, and made amendments to the fourth ancl fifth resolutions; also, 
 that they had further amended the said report, by adding" thereto three new 
 resolutions, to come in as the 6th, 7th, and 8th. 
 On motion of Mr. EPPES, 
 
 Ordered, That the said report do lie on the table. 
 
 OCTOBER 28, 1814. 
 
 The House resumed the consideration of the remaining part of the report of 
 the committee of the whole, it being the 8th resolution, "that it istexpedi- 
 ent to establish a national bank, with branches, in the several States." 
 
 Mr. POST, of N. Y. , hoped the chairman or some other member of the Com- 
 mittee of Ways and Means would explain the reasons on which the proposi 
 tion was founded. 
 
 Mr. CLOPTON, of Va-, called upon gentlemen in favor of the proposition to 
 show in what part of the constitution was contained the power to establish a 
 national bank. Having always, himself, denied the constitutional power, and 
 the House having so decided, six years ago, he could not see what had occur- 
 red to change the nature of the constitutional question. Unless his objections 
 on this head were removed, he must certainly vote against this proposition. 
 
 Mr. EPPES, of Va. , said his sentiments in relation to this question were well 
 known, and were not changed. However necessary he might believe the 
 agency of such an institution at the present moment, he could not give his con- 
 sent to a measure which he believed contrary to the constitution. For the 
 reasons in favor of the resolve which he had reported, in obedience to the in- 
 structions of the committee, he referred to Mr. DALLAS'S report, and to the 
 gentlemen of the committee who favored it. 
 
 Mr. WRIGHT, of Md., expressed himself decidedly in favor of the esta- 
 blishment of a bank, but, in order to obviate objections some might conscien- 
 tiously entertain on constitutional grounds, he was of opinion that the bank 
 ought to be located within this district- He therefore moved to amend the 
 resolve, by inserting therein the words " within the District of Columbia." 
 
 Mr. BURWELL, of Virginia, said he had no doubt of the power of Congress 
 to establish a bank of the kind proposed, in the District of Columbia: but he 
 should vote against the amendment, because he believed such a bunk would 
 not at all assist the finances of the Government. He was, also, entirely hos- 
 tile to the establishment of a bank on the principles recommended in the Se- 
 cretary's report as its basis, for reasons growing out of their general impracti- 
 cability and inexpediency. 
 
PROCEEDINGS OF 1814. 435 
 
 Mr. DUVAL, of Kentucky, said he was opposed to the proposed amendment, 
 because it would destroy the utility of the bank, so far as regards its issuing 
 a medium which should possess the general confidence; and he was opposed 
 to it, also, because the adoption of it would virtually sanction the construc- 
 tion, which he denied, that it was not constitutional to establish a bank with 
 branches in the several States. Mr. D. was proceeding to argue in support of 
 the constitutionality of a bank, when 
 
 Mr. WRIGHT withdrew the amendment which he had proposed. 
 
 Mr. STANFORD, of North Carolina, moved to strike out of the resolve the 
 following words: * % with branches in the several States." Some gentlemen, 
 he said, were of opinion a bank might be established adequate to all necessary 
 purposes, having no branches, but arrangements with some one or more banks 
 now existing in each State. He was in favor of leaving the question as broad 
 as possible. 
 
 Mr. DUVAL resumed his argument on the constitutional question, which he 
 examined with no little ability and ingenuity. He chiefly rested his opinion 
 of the power to incorporate a bank, on that section of the constitution which 
 prohibits the States to coin money, or issue " bills of credit;" which negation 
 of power, he apprehended, implied the existence of the power in Congress. 
 If Congress had not power, under the constitution of the United States, to 
 establish a bank or banks, nearly all the States had violated their own State 
 constitutions, as well as the constitution of the United States, in authorizing 
 the circulation of bank notes, which, call them what you will, are " bills of 
 credit." Mr. I), went deeper still into this question, and concluded with ex- 
 pressing his decided hostility to the proposed amendment. 
 
 Mr. GROSVKNOII. of New York, having no doubt of the constitutionality of 
 a national bank, entreated gentlemen to vote down the proposed amendment; 
 because, if adopted, it would hold out fallacious ideas of the adequacy of a 
 bank without branches, to be established within this district, which would no 
 more relieve the embarrassment of our finances than will the five and ten 
 cents bills issued by the corporations of this city and Georgetown, &c. He 
 should vote for the general proposition. As for the Secretary's proposition, 
 it was afelo de se; and many of its features could not be sanctioned in this 
 House. 
 
 Mr. H.vwKiXb, of Kentucky, said that one of his earliest convictions on 
 political topio was, that this Government had no p nver to establish a na- 
 tional bank; but, if it is to be established, he was clearly of opinion it ought 
 to be on general principles. In order to give the question full and ample con- 
 sideration on the widest national, just, and general objects, he should vote 
 against the amendment, without intending in any way to sanction the idea that 
 Congress has the power " to establish a national bank with branches in the 
 several States.'" 
 
 Mr. CLOPTON made a number of observations in reply to the argument of 
 Mr. DUVAL. The true principle of construction of the constitution being that 
 all powers not expressly delegated are reserved, he contended that Congress 
 could by no forced construction derive the power to establish a national bank. 
 
 Mr. WILSON, of Pennsylvania, predicated his views in favor of the resolu- 
 tion, and against the amendment, on the statement of facts, and reasoning ot 
 the Secretary of the Treasury on this subject, which, combined, he believed 
 to be conclusive. 
 
 Mr. M'KEE, of Kentucky, expressed surprise that the opposition to this 
 measure, declared by the Secretary of the Treasury to be necessary not only 
 to the maintenance but to the restoration of the public credit, proceeded from 
 those who had, in every other respect, been the most zealous and inflexible in 
 their pursuit of measures to sustain the operations of the Government. He had 
 no doubt of the power of the Government to establish a national bank as an in- 
 strument of finance, and entered into a train of reasoning, with his usual acu- 
 men, as well to prove this, as to prove the injury which had resulted from the 
 
DANK OF THE UNITED STATES. 
 
 refusal to re-charter the late Bank of the United States. As to the establish- 
 ing the bank within this district, for all present practical purposes, it might as 
 well be established in Abyssinia. He was decidedly opposed to the motion 
 now under consideration. 
 
 The question on Mr. STANFORD'S motion to strike out the words " with 
 branches in the several States," was decided, by yeas and nays, in the nega- 
 tive, as follows: For the motion, 14. Against it, 138. 
 The question being stated on the passage of the resolution 
 Mr. POST, of New York, said, under present impressions, he should vote 
 against it. because the idea it embraced was illusive, and its object impracti- 
 cable at me present moment; to show which, he made a number of remarks 
 going to establish the insufficiency of such a measure to remedy the general 
 want of confidence among individuals as well as in the banks, which at pre- 
 sent prevailed. 
 
 The question on the adoption of the resolution was decided by the following 
 vote: 
 
 Those who voted in the affirmative, are, 
 Messrs. Alexander, Messrs. Forney, 
 
 Alston, Forsyth, 
 
 Anderson, Gaston, 
 
 Archer, Geddes, 
 
 Avery, Gourdin, 
 
 Barnett, Griffin, 
 
 Bayly, of Virginia, Grosvenor, 
 
 Bradley, Hanson, 
 
 Brown, Harris, 
 
 Butler, Hasbrouck, 
 
 Caperton, Hawes, 
 
 Caldwell, Hopkins, of Ken, 
 
 Calhoun, Hubbard, 
 
 Cannon, Hurlbert, 
 
 Chappell, Ingersoll, 
 
 Clark, Ingham, 
 
 Comstock, Irving', 
 
 Condict, Kent, of New York, 
 
 Conard, Kent, of Maryland, 
 
 Creighton, Kerr, 
 
 Crouch, Kershaw, 
 
 Culpeper, Kilbourn, 
 
 Cuthbert, King, of N. Carolina, 
 
 Dana, Lefferts, 
 
 Davis, of Penu. Lewis, 
 
 Denoyelles, Lovett, 
 
 Duval, Lowndes, 
 
 Earle, Lyle, 
 Farrow, 
 Findley, 
 
 Fisk, of New York, 
 
 M'Kee, 
 M'Kim, 
 M'Lean, 
 
 Messrs. Montgomery, 
 Moore, 
 Markell, 
 Oakley, 
 Ormsby, 
 Parker, 
 Pearson, 
 Pickens, 
 Piper, 
 
 Rea, of Penn. 
 Rich, 
 
 Robertson, 
 Sage, 
 Sevier, 
 Sherwood, 
 Shipherd, 
 Skinner, 
 Smith, ofN. H. 
 Strong, 
 Sturges, 
 Tannehill, 
 Taylor, 
 Telfair, 
 Thompson, 
 Udree, 
 
 Ward, of N. Jersey, 
 Webster, 
 Wilson, of Pcnn. 
 Winter, 
 Wright, 
 Yancey. 93. 
 
 Those who voted in the negative, are, 
 
 Messrs. Barbour. Messrs. "Clopton, 
 
 Bard, Crawford, 
 
 Baylies, of Mass . Davenport, 
 
 Bowen, Desha, 
 
 Boyd, Ely, 
 
 Bradbury, Eppes, 
 
 Burwell," Evans, 
 
 Champion, Franklin, 
 
 Cilley, Gholson, 
 
 Messrs. Glasgow, 
 Goodwyn, 
 Hale, 
 Hall, 
 Hawkins, 
 Humphreys, 
 Hungerford, 
 Jackson, of R. I. 
 Jackson, of Vir. 
 
PROCEEDINGS OF 1814. 437 
 
 Messrs, Johnson, of Vir. Messrs. Pleasants, Messrs. Seybert, 
 
 Kennedy, Post, Sharp, 
 
 King-, of Mass. Potter, Smith, of Virginia. 
 
 Law, John Reed, Stanford, 
 
 Macon, William Reed, Taggart, 
 
 Moseley, Rhea, of Tennessee. Vose, 
 
 Nelson, Ring-gold, Wheaton, 
 
 Newton, Ruggles, Wilcox, 
 
 Pitkin, Schureman, Wilson, of Mass. 54 
 
 So the resolution was agreed to, and this, together with the other resolu- 
 tions, were referred to the Committee of Ways and Means, to bring in bills 
 acccordingly. 
 
 NOVEMBER 7, 1814. 
 
 Mr. FISK, of New York, from the Committee of Ways and Means, asked 
 and obtained leave to report a bill to incorporate the subscribers to the Bank 
 of the United States of America; which was twice read by its title, and re- 
 ferred to a committee of the whole. 
 
 And the House adjourned. 
 
 NOVEMBER 13, 1814. 
 
 The House went into committee of the whole on the said bill; which hav- 
 ing been read through, the committee rose, and obtained leave to sit again. 
 
 NOVEMBER 14, 1814. 
 
 The House resolved itself into a committee of the whole, Mr. NELSON, of 
 Virginia, in the chair, on the bill to incorporate the subscribers to the Bank 
 of the United States of America. 
 
 The first section of the bill having been read, in the following words: 
 "Be it enacted, $-c. That a bank of the United States of America shall be es- 
 tablished, the capital stock of which shall be fifty millions of dollars, and no 
 more, divided into one hundred thousand shares, of five hundred dollars each 
 share, and that subscriptions towards constituting the said capital stock, shall 
 
 be opened on the first Monday of next, at the following places, viz: 
 
 Boston, New York, Philadelphia, Baltimore, Richmond, Charleston, and 
 Pittsburg, under the superintendence of the following persons, as commis- 
 sioners to receive the same: At Boston, James Lloyd, Thomas Perkins, and 
 W r illiam Gray; at New York, General John Smith, Isaac Bronson, Theron 
 Rudd; at Philadelphia, Thomas M. Willing, Stephen Girard, Chandler Price; 
 at Baltimore, Henry Pason, William Cooke, \Villiam Wilson; at Richmond, 
 Benjamin Hatcher, John Brokenborough, William Preston; at Charleston, 
 John C. Faber, John Potter, James Carson; at Pittsburg, George Robinson, 
 Samuel Robert, and Henry Baldwin; which subscriptions shall continue open 
 every day, from the time of opening the same, from ten o'clock, in the fore- 
 noon, until four o'clock, in the afternoon, until the Saturday following, at four 
 o'clock, in the afternoon, when the same shall be closed; and, immediately 
 thereafter, the commissioners, or any two of them, at the respective places 
 aforesaid, shall cause two transcripts or fair copies of such subscriptions to be 
 made; one of which they shall send to the Secretary of the Treasury, one they 
 shall retain, and the original subscriptions shall, within three days from the 
 closing of the same, be, by the said commissioners, transmitted to the said 
 commissioners at Philadelphia, or to one of them; and, on the receipt thereof, 
 the said commissioners at Philadelphia, or any two of them, shall immediate- 
 ly thereafter convene, and proceed to take an account of the said subscrip- 
 tions: and if more than the amount of the said capital stock of thirty millions 
 of dollars shall have been subscribed, then the said last mentioned commis- 
 sioners shall apportion the same, among the several subscribers, in a just and 
 equal ratio, according to their several and respective subscriptions: Provided, 
 however, That such commissioners shall, by such apportionment, allow and 
 
488 BANK OF THR UNITED STATES. 
 
 apportion to each subscriber at least one share; arid, in case the aggregate 
 amount of the said subscriptions shall exceed fhirty millions of dollars, the 
 said commissioners, after having apportioned the same, as foresaid, shall cause 
 lists of the apportioned subscriptions to be made out, including in each list the 
 apportioned subscription for me place where the original subscription was 
 made; one of which lists shall be transmitted to the commissioners, or to one 
 of the commissioners, under whose superintendence such subscriptions were 
 originally made, that the subscribers may ascertain from them the number of 
 shares apportioned to such subscribers, respectively." 
 
 Mr. FISK, of New York, stated the reasons which had influenced the Com- 
 mittee of Ways and Means in confining to a few cities and towns the books 
 of subscription, which were, generally, that the Atlantic cities were the prin- 
 cipal repositories of specie and superfluous wealth, arid that the exigencies of 
 the times required greater expedition than was consistent with a more diffused 
 subscription. It had been deemed proper, however, to add more commission- 
 ers in two or three of the cities; and he was instructed to move accordingly. 
 
 And, on motion of Mr. FISK, the following gentlemen were added: To the 
 commission at Boston, William Eustis and Samuel Brown; to the commission 
 at New York, Isaac Lawrence and John Hone; to the commission at Phila- 
 delphia, Jared Ingersoll and Anthony Taylor. 
 
 Mr. SHARP, of Kentucky, then said.he was not satisfied, by the reasons of 
 the gentleman, for limiting to so few the places of subscription, and moved, 
 for the convenience of the Western country, to insert Lexington, in Ken- 
 tucky. 
 
 Mr. ROBERTSON, of Louisiana, proposed also New Orleans, and argued, 
 with much force, in support of his suggestion; and other gentlemen proposed 
 other places. 
 
 The motion of Mr. SHARP, being the one immediately before the House, gave 
 rise to a considerable debate. The motion was supported by Messrs. Sharp, 
 Robertson, Lewis, Macon, Wright, Pearson, Harris, Hopkins, of Kentucky, 
 Burwell, and Barnett, and opposed by Messrs. Fisk, of New York, Oakley, 
 Creighton, and Ingham. 
 
 On the one hand, various arguments were urged in favor of extending the 
 subscription, founded on the equal rights of all sections of the country to par- 
 ticipate in any general benefit; the expediency of collecting specie from every 
 part of the country; the advantages of uniting in the subscription People of 
 every quarter of the country; and thus uniting the People of all sections to the 
 Union, by the ties of interest, which are frequently stronger than those of 
 legal or moral force. 
 
 On the other hand it was said, besides the delay inseparable from such a 
 course, that it was important that the bank should be put into operation speedi- 
 ly, if at all, and that its commencement would be greatly delayed by multiply- 
 ing places of subscription. It was also said, that, if this motion were with- 
 drawn, an amendment might be devised by the Committee of Ways and Means, 
 which would meet the views of all parties. 
 
 Mr. SHARP'S motion at length prevailed. Lexington, Kentucky, was in- 
 serted as one of the places at which subscriptions should be opened, and 
 Messrs. Charles Wilkins, Lewis Sanders, and John H. Morton, designated 
 as the commissioners. 
 
 On motion of Mr. ROBERTSON, New Orleans was then added, and com- 
 missioners named for that place. 
 
 On motion of Mr. HARRIS, Nashville was added, and Robert Weakley, 
 Felix Grundy, and JohnR. Bedford, named as the commissioners. 
 
 On motion of Mr. LEWIS, Washington City was added, and Robert Brent, 
 Walter Smith, and Thomas Swann, named as commissioners. Mr. FISK, of 
 New York, named John Mason, Daniel Carroll, and John P. Van Ness; but 
 Mr. LEWIS'S motion bein;; the first made, was agreed to. 
 
PROCEEDINGS OF 1814. 439 
 
 On motion of Mr. MACON, Raleigh, in .North Carolina, was inserted, arid 
 Sherwood Hay wood, Beverly Daniel, and William Pierce, named as commis- 
 sioners. 
 
 On motion of Mr. FORSYTH, Savannah, in Georgia, was added, and John 
 Bolton, Charles Harris, and James Johnson, named as commissioners. 
 
 On motion of Mr. CONDICT, New Brunswick, in New Jersey, was added, 
 and James Vanderpuol, John Gray, and Peter Gordon, named as commission- 
 ers. 
 
 Mr. GROSVENOR moved to add Utica, in New York, and John C. Devereaux, 
 Benjamin Walker, and Jeremiah Van Rensselaer as commissioners; but the 
 motion was negatived, after some objections by Mr. INGHAM, and replication 
 by Mr. GROSVENOR. 
 
 On motion of Mr. WEBSTER, Portsmouth, in New Hampshire, was added, 
 and John Goddard, Nathaniel A. Haven, and Nathaniel Gilman, named ai 
 commissioners. 
 
 On motion of Mr. KILBOLRN, Pittsbarg was stricken out, Chilicothe, in Ohio, 
 added, and Samuel Find ley, Thomas James, and William M'Farland, named 
 as commisioners. 
 
 Mr. LEWIS then made a motion, the object of which was to establish the 
 principal bank at the city of Washington, in this District. 
 
 This motion was opposed by Mr. FISK, of New York, who said that the 
 Committee of Ways and Means had fixed on Philadelphia, ill preference to 
 New York and other places, to be the seat of the principal bank, as being a 
 place of greater security and greater wealth, and as being more central to the 
 commercial transaction's and wealth of the country, &c. 
 
 Mr. LKWIS said he had no doubt that the gentleman from New York pre- 
 ferred Philadelphia to this place, as he had already given sufficient evidence 
 of his candor in thai respect. Th-> Military School, the National Bank, and 
 every institution of a national character, had been contemplated to be fixed at 
 this place, by those wh > located the seat of Government here, &c. and so they 
 ought to be, &c. Besides, there might be many gentlemen who would vote for a 
 bank to be established at this place, who would, on constitutional grounds, be 
 opposed to its establishment elsewhere. He therefore hoped his motion would 
 be agreed to. 
 
 Mr. LEWIS'S motion was negatived, about thirty members only rising in 
 favor of it. 
 
 On motion of Mr. FISK, of New York, an amendment was adopted, author- 
 izing the Philadelphia commissioners, in case Thirty millions should not be 
 subscribed and returned to them within the time allowed, to open the books 
 at Philadelphia until the whole should be subscribed. 
 
 Mr. G ASTON, of North Carolina, then said, before the committee proceeded 
 further in the bill, he wished to propose a material amendment to it, and, with 
 a view to ascertain whether the House were disposed to hear him in support ot 
 his motion at this late hour of the day, he moved that the committee now rise. 
 
 This motion was negatived; and 
 
 Mr. GASTOX proceeded to lay before the committee his views in relation to 
 this bill. He professed himself anxious for the establishment of a National 
 Bank, which he had always fovored when opportunity ottered. But it was his 
 decided conviction, he said, that a bill like that on the table would not answer 
 the purposes of the nation or ot the Government. This view of the subject he 
 supported by various objections to different features of the bill, and particularly 
 to the mode of subscription in stock of the United States; the operation of all 
 which he contended would be to throw into circulation a quantity of paper, 
 founded not on a specie capital, but on the credit of the United States' stock, 
 &c. which would therefore be of no greater value than any other paper which 
 the United States should make receivable in I axes, though much more expen- 
 sive to the United State.-; than treasury notes or bills of credit would be, &c. 
 &c. In support of this idea. Mr. G. adduced many illustrations, from writers 
 62 
 
490 BANK OF THE UNITED STATES. 
 
 on this subject, from our own history, and from analogy. He objected 
 also to the proposed appointment of a part of the directors oy the President, 
 to the large portion of the stock to be held by the United States, &c. He 
 wound up his argument on these and other points by observing, that, as he was 
 friendly in principle to the establishment of a National Bank, he should not 
 consider himself as doing his duty, if, while he disapproved of this plan, he 
 did not otter another as a substitute to it. Instead of a bank of a nominal 
 capital of fifty millions, he would establish a bank whose capital should not, 
 ct farthest, exceed twenty millions. He considered it as by no means im - 
 portantto its success that the Government should subscribe a cent to its capi- 
 tal stock; but, as that was a fashionable idea, he would say a portion of the 
 capital, five millions, should be subscribed by the Government; that the re- 
 maining fifteen millons should be subscribed by individuals, five millions of it 
 at least, in specie, the remainder either in treasury notes, at par, or in six per 
 cent, stock of future loans, at par, or six per cent, stock of former loans, at the 
 price at which it was contracted for with the Government. So far from such 
 stock being inalienable, as now proposed, he would permit the directors to 
 manage and dispose ot it as they pleased. They might lend money to the 
 Government if they found it to their interest and convenience to do so. He 
 would abolish from such a charter the idea that the fiat of the President should 
 at any time suspend the payment of specie by the bank, &c. If any plan of a 
 National Bank could succeed, it must be on something like the plan of which 
 this was the outline. To try the principle of this bill, arid whether the House 
 were disposed to accept any amendment whatever to it, Mr. GASTON concluded 
 his speech by moving to strike out fifty millions (the proposed capital stock 
 of the bank) and insert in lieu thereof twenty millions. 
 
 On motion of Mr. HOPKINS, of Kentucky, the committee then rose, and 
 obtained leave to sit again. 
 
 NOVEMBER 15, 1814. 
 
 The House again resolved itself into a committee of the whole, Mr. NELSON, 
 of Va. in the chair. 
 
 The motion of Mr. GASTON to make the capital of the bank twenty instead 
 f fifty millions of dollars, being still under consideration 
 
 Mr. FISK, of New York, spoke in reply to Mr. GASTON'S speech, and in ex- 
 planation of the views of the committee. He declined replying to Mr. GAS- 
 TON'S objections to various details of the bill, until those details should come 
 immediately under consideration of the House; but applied his observations 
 particularly to Mr. G's objections to the amount and character of the propos- 
 ed capital of the bank. The objects of the Committee of Ways and Means 
 in proposing such an institution, ought ever to be kept in view in this discus- 
 sion. They were, generally, the revival and support of the public credit. 
 These objects could be best accomplished, 1st. By raising the value ot the 
 public stocks; and, 2d. by the establishment of a competent circulating me- 
 dium. Mr. F. then entered into an argument to show that the plan now be- 
 fore the House was that which would best accomplish these objects. He referred 
 to the history of the former Bank of the United States, established with similar 
 objects and under like circumstances, and from its efficiency argued what 
 might be expected from this bank. The committee, in inquiring as to the amount 
 of circulating medium which could be now advantageously employed, had fix- 
 ed on fifty millions, which amount had also received the sanction of the opi- 
 nion of the Secretary of the Treasury. The present banking capital of the 
 nation being estimated at a hundred millions, it was believed by the com- 
 mittee that the addition of fifty millions would not be dangerous either to 
 those institutions or to the community. Having thus determined on an in- 
 crease of the circulating medium of the country, the next object was the ap- 
 preciation of the value of the public stock. That stock had depreciated in 
 value, not from any doubt of the ability or disposition of the Government to 
 
PROCEEDINGS OF 1814. 
 
 ecmply with its engagements to tlie public creditors, but from the quantity of tiie 
 stock which it had been necessary to throw into market exceeding the means for 
 purchasing it. A relief of the stock from its present depreciation was promis- 
 ed by the withdrawal of a part of it from the market; and \yith this view, it 
 had been contemplated that twenty- four millions of the capital stock of the 
 bank should be subscribed in Government securities. This, by taking so much 
 .stock out of the market, would raise the price of the stock, and make room 
 for more, which it might be necessary to create. It had been thought proper, 
 too, that the United States should hold a part of the stock of the bank to 
 what amount, there had been some difference of opinion; and if the House 
 thought too great a proportion was by this bill allowed to the United States, 
 they would so decide, Mr. F. was willing, for himself, that the bank should 
 be connected with the Government, and the Government with the bank, and 
 that they should mutually support each other, &c. As to the share of the 
 Government in the appointment of directors, whilst it could be no injury to 
 the institution, it was necessary as well to guard the interest of the United 
 States, as to take care of their interest in 1he security of the revenue in the 
 various branches of the bank. Mr. F. took a comparative view of the situa- 
 tion of the nation now and in 1791, when the Bank of the United States was 
 established, dwelling on the diminution of the public debt and increase of the 
 means of payment, since that day the increase of circulating medium, 
 wealth, population, c, from which lie concluded there was as ample employ- 
 ment for a bank of fifty millions now, as lor a bank of ten millions then. 
 Of the ten millions capital of that bank, three-fourths of it was composed of 
 public stock, as much depreciated at that day, as public stock now is. The 
 operation of that bank, he said, had been not only beneficial, but wonderful, 
 giving a spring to public credit, and raising the price of all public stock as 
 he believed tins bank would, when once established. As to the specie capital, 
 it was difficult, he remarked, to say how much specie would give confidence 
 to the operations of the bank. The old bank of the United States had com- 
 menced its operations on a specie capital of 400,000 dollars. He had no 
 doubt, therefore, but this bank might safely commence its operations on a 
 specie depositeoi' 1,200,000 dollars, which he believed there would be no diffi- 
 culty in procuring. As to the confinement ot the subscription to the stock 
 created since the war, the committee had deemed it proper to confine their 
 object of raising the price of the public stock to such as was depreciated, viz. 
 to that which had been created since the declaration of war, and which had 
 depreciated, perhaps, because not so well supported by specific pledges of 
 revenue as the old six per cent, stock. These various features were, how- 
 ever, in the hands of the committee of the whole, and entirely at their dispo- 
 sal, &c. 
 
 Mr. GASTON, in a speech of some length, advocated the superiority of the 
 plan he had yesterday indicated over that embraced in this bill, and replied 
 to the remarks of Mr. FISK. He expressed his regret that Mr. FISK had de- 
 clined replying to the objections he had urged to the bill, and had not given a 
 general statesman-like exposition of the whole bill, instead of resting its de- 
 ience on the magic words revival, and support of the public credit, &c. He 
 repeated, and enforced at some length, his objections to this system, which 
 he contended would neither revive the public credit nor afford a circulating 
 medium of general credit. As to the momentary appreciation of the public 
 stocks, it would benefit only the particular individuals who held them; and, 
 as to an increase of mere paper, it was not even desirable: for it was the su- 
 perabundance of that which had already caused the specie of the country to 
 disappear, &c. He compared this proposition to relieve the evil arising from 
 too much paper, by throwing more into circulation, to the remedy which 
 Burke had described the French Convention as prescribing for every evil, 
 viz. issuing more assignats. As to the necessary specie capital, and the faci- 
 lity of obtaining it in the course of banking operations, Mr. G. said, a bank 
 must have specie before it has credit; when it has credit, it may obtain specie, 
 
492 BANK OP THE UNITED STATES. 
 
 but not till then, &c. Upon the whole, he had no confidence in this system, 
 In times of public difficulty in times like this people were too apt to look 
 for relief from some splendid project. It was a period like this in the finan- 
 ces of France, that Mr. Law came forward with his Mississippi bank project. 
 The old fashioned notion of redeeming credit by economy, punctuality in ful- 
 filling engagements, &c. was at that time abandoned; and tne result was, that 
 thousands of individuals were ruined, and the finances of the French nation 
 reduced to a lower state of degradation than when the attempt was made to 
 resuscitate them. He cautioned gentlemen against falling into the same error, 
 and to examine well the practicability of the system proposed for their con- 
 sideration, &c. 
 
 Mr. FISK made some remarks by way of resisting the attack which he said 
 the gentleman had to-day made from the same battery as he yesterday opened 
 on the bill. He denied the applicability of some of his remarks, particularly 
 of that in relation to Law's scheme, \yhich arose from that bank's having issu- 
 ed a vast amount of paper on its capital, founded on the fictitious value of 
 certain land certificates, &c. an excess of folly into which no properly regu- 
 lated bank was in any danger of falling, &c. 
 
 The question on Mr. GASTON'S motion to strike out $fty and insert twenty 
 millions, was then decided as follows: For the motion, 47. Against it, 79. 
 
 So the motion was negatived. 
 
 On motion of Mr. PARKER, of Massachusetts, among the places at which 
 subscription books should be opened, Hallo well, in M-aine was inserted, and 
 three persons named as commissioners. 
 
 Mr, CONDICT, of New Jersey, said he thought it would be good policy to 
 permit as large a portion of the agricultural community to contribute to the 
 stock as possible. With this view he moved to increase the number of shares 
 from one to Jive hundred thousand, and reduce the amount of each share to 
 one instead of Jive hundred dollars. 
 
 Mr. FISK, of New York, opposed this motion. The shares, he conceived, 
 were made sufficiently small, to enable every one so disposed to participate 
 in the bank; whilst a still further subdivision of the stock would produce great 
 embarrassment, and a total derangement of the details of the bill, and much 
 difficulty in apportioning the proportions of stock, treasury notes, and specie 
 to be paid on each share. 
 
 The motion was rejected, ayes 32. 
 
 Mr. WRIGHT, of Maryland, proposed to substitute, for the provision re- 
 specting the manner of taking subscriptions for this stock, a provision for divid - 
 ing its capital stock, among the several States in proportion to their repre- 
 sentation, so that all the members of the Union might equally participate in the 
 benefits of such subscription. He had no doubt the subscriptions would be 
 advantageous to the individuals, inasmuch as he believed the stock would be 
 greatly above par as soon as the bank went into operation. Not having, how- 
 ever, had time to prepare an amendment to meet his wishes, he should waive 
 his motion for the present, until the bill was gone through. 
 
 After making further verbal amendments to the 1st section 
 
 The second section of the bill was read: 
 
 Mr. HALL, of Georgia, moved to amend this section by adding thereto a pro- 
 viso, in the following words: 
 
 " Provided, That no interest shall accrue on the public stock or treasury 
 notes paid by the subscribers as a part of the capital of the bank during the 
 continuance of the charter." 
 
 The reason assigned by Mr. HALL was, that the bank would draw a double 
 interest on the stock part of the capital, viz. 6 per cent, on the stock, and a 
 per centage from the operations of the bank upon that stock. 
 
PROCEEDINGS OF 1814. 495 
 
 Mr. FISK opposed this motion, and expressed much surprise at it. He thought 
 the moral sense of the Government must revolt at its injustice? besides, that 
 it would destroy all possibility of organizing a bank on the principles propo- 
 sed by the bill. 
 
 The motion of Mr. HALL was negatived, very lew voices only appearing in 
 favor of it. 
 
 Mr. OAKLEY, of New York, moved so to amend the bill as to make it op- 
 tional to subscribers to pay in the whole of their shares (except the specie 
 part) in six per cent, stock, instead of compelling them to pay in a part of 
 the subscription in treasury notes. 
 
 This motion was opposed by Mr. FISK, of New York, and negatived, ayes 
 only 43. 
 
 Mr. BRADBURY, of Massachusetts, made a motion, the object of which was, in 
 the provision respecting the subscription of a certain proportion of the capital 
 in stock of the loans created since the war, to substitute, in lieu thereof, the 
 stock "in loans hereafter to be contracted by authority of any act of Congress, 
 passed, or to be passed, during the present session." 
 
 Mr. B. said that the bill, as it now stood, would afford no real advantage 
 to the Government, unless it were in the privilege of borrowing thirty millions 
 of dollars from the bank. The intention of the charter proposed to be granted 
 by the bill, was to authorize the individuals associating to issue paper money 
 notes which would promise to pay nothing but paper: for, he contended, 
 whether the provision authorizing the President, on certain occasions, to 
 suspend payment of specie, waere adopted or not, the institution would be 
 nothing but a bank of paper money; and he could see no advantage the Go- 
 vernment could derive from borrowing thirty millions of paper money. If, 
 however, this bank should be advantageous or profitable to the stockholders, 
 he could see no reason why those who had lent the Government money, since 
 the declaration of war, should have any advantage over any present or future 
 stockholders. They had obtained, he conceived, sufficient discount beyond 
 the six per cent, interest for the loans they had made; and yet, it appeared to 
 him, from an examination of this bill, that its whole object was to benefit this 
 description of persons. If this bank should go into operation, which he doubt- 
 ed, even should the bill pass, what, he asked, would be the consequence? 
 Ignorant and unwary men would purchase the public stock, at par, from these 
 who contracted for it, and now hold it, and presently the bubble would burst, 
 and these purchasers become the losers by the scheme. If the individuals 
 who took the last loans, had been permitted to devise a bill for their particu- 
 lar advantage, they could not have drawn one to suit them better, &c. 
 
 Mr. WRIGHT, of Maryland, proposed to submit, in lieu of Mr. BRADBURY'S 
 motion, an amendment which he had prepared. 'If the House meant to do 
 perfect justice to themselves, and to the United States, he said they would be 
 indisposed to put the public stock, redeemable at the will and pleasure ot the 
 Government, on the same footing as specie: and, if that stock were permit- 
 ted to be subscribed, at the contract p/nce^ it would be a sufficient bonus to the. 
 stockholders that their stock was converted into bank capital which would 
 immediately rise to fifty or sixty per cent, above par. In such a provision as 
 he proposed, there would be nothing coercive; the stockholder might or might 
 not subscribe his stock; if he did, he would be placed on the same footing 
 as the rest oi the community. Mr. W. wished, therefore, to admit any stock 
 to be subscribed, of the past or future loans, at the contract price. 
 
 Mr. BRADBURY declined assenting to this substitute to his motion, which, 
 however, he modified, by adding to the end of it the words, "at its par value " 
 thus proposing to allow subscriptions to the bank in the stock of any future 
 loan, at its par value. 
 
 Mr. FISK opposed Mr. B's motion with considerable warmth. If they could 
 
494 BANK OF THE UNITED STATES. 
 
 not aid the public credit, he said, he hoped Congress would refrain from doing 
 any thing which should injure it. The public creditor had generally gone to 
 the extent of his means in purchasing the public stock now lying on his liands. 
 But it never could have entered into his calculation that the Government 
 would adopt any measure calculated directly to bear on him, as the creation 
 of a new stock, on a different footing, certainly would, by giving it the advan- 
 tage in the market over him. Such a course pursued by Government, of ex- 
 ercising its power to serve its own purposes, instead of pursuing a course of 
 magnanimous policy, must, Mr. F. said, be repugnant to every sentiment of 
 morality as well as justice, which ought to be observed by nations. It would 
 be an iniquitous delusion practised on the community, inasmuch as the depre- 
 ciation of public stock does not now arise so much from distrust of the Gov- 
 ernment as from inability of the people to lend, which ability could not be 
 increased by giving this sort of privilege to the stock in any subsequent loans, 
 &c. Such a discrimination as is proposed, would so weaken the confidence in 
 the public faith, that, he did not believe, after adopting it, the Government 
 would be able to obtain further loans on any terns. 
 
 Mr. HAWKINS, of Kentucky, in a very decided manner reprobated the 
 adoption of this amendment. It was pretty well understood, he said, that the 
 Government had exhausted almost to the last cent the ability of the nation to 
 obtain loans under the existing state of things. It was true, that, while this 
 House was recently debating on the three millions loan bill, he had suggested, 
 and it was the fact, that the Executive was negotiating a part of the six mil- 
 lions loan. They had hopes, also, to obtain, under the bill last proposed, a loan 
 to enable them to redeem the treasury notes becoming due in this quarter. 
 But, how could this body expect this Government should, in the hour of most 
 need and difficulty, obtain those resources which are indispensable to the ful- 
 filment of the public engagements, if gentlemen, first on one day, and then 
 on another, should persist in introducing motions and speeches in respect to 
 the present creditors, which must have an injurious effect on future loans? No 
 doubt thegentleman, in this motion, thought he was advocating the interests of 
 his country; but, unfortunately, by one and another proceeding, public credit 
 was injured, and the operations of Government retarded. Remarks had been 
 made on this floor, and he alluded emphatically to those unfortunately made 
 by a gentleman from Virginia, (Mr. JACKSON) who, he regretted, was not 
 now in his seat, which had a more deleterious effect on public credit than that 
 gentleman could possibly liave expected or wished. They were certainly not 
 authorized by sound policy, and he would venture to say, so far as they re- 
 spected the public credit, the redemption of the public debt, and payment of 
 past and future loans, were not sanctioned by the administration or any mem- 
 ber of it. He would not support any men or administration that supported 
 such a doctrine, and, so far as the doctrine had been advocated by one of his 
 political friends, he declared the opinions expressed were not his; that they 
 were unworthy of any party, of any government, of any administration, or any 
 member of it. As to this bill, he entertained constitutional objections to the 
 establishment of any bank; if they could be removed, he might vote for this 
 bill. He did not rise to speak of its merits, but to protest against propositions 
 calculated to weaken, if not destroy, all confidence in the public faith. It 
 had been assigned as a reason for such a motion, that speculators had preyed 
 on the public credit. This he denied. The Government had gone on relying 
 on the public credit alone to support its loans, until the terms on which they 
 could be obtained had fallen from par to 88, from 88 to 80, &c. The Govern- 
 ment had been compelled to have money, and had bought it as low as they 
 could. As to the terms of the ten millions loan, on which so much had been 
 suid, Mr. H. said it was only an adaptation to that loan by Mr. Campbell, of 
 the terms on which Mr. Gallatin had, without censure, obtained the sixteen 
 millions loan, and m consequence of which last engagement the terms of the 
 loan had been more than once varied, &c. Nay more, he said, the terms al- 
 lowed by Mr. Campbell were less advantageous to the contractors than those 
 
PROCEEDINGS OF 1814. 40,5 
 
 allowed by Mr. Gallatin, so that the blame thrown on him was imputable not 
 to the terms of the late loan, but to the inability of the Government to borrow, 
 &c. Mr. H. protested against the principle of this amendment. If the House 
 resorted to invidious discriminations between the public creditors, he admon- 
 ished them that they would paralyze their own arm, and arrest the future op- 
 erations of the Government. 
 
 Mr. GHOLSON said he sincerely regretted, that, the animadversions of the 
 honorable gentleman from Kentucky (Mr. HAWKINS) on the speech of the 
 honorable gentleman from Virginia (Mr. JACKSON) on the loan bill, had not 
 been made while that gentleman was present, so that he might have had an 
 opportunity of vindicating himself before the committee and the nation. Mr. 
 G. observed that he did not recollect the remarks of his friend (Gen. JACK- 
 SOX) with sufficient distinctness to attempt to state the substance of them to 
 the committee. He, however, did not understand them to be such as could 
 be construed into an indisposition to pay the public debt. Mr. G. said he ap- 
 plauded the zeal which had been manifested by the honorable gentleman from 
 Kentucky, in favor of the public credit. With that gentleman he ardently 
 hoped, that ample provision would be made, at the present session, for the 
 punctual payment of the interest, and for the redemption, within a reasonable 
 time, of the last cent of the principal of every description of the public debt. 
 
 Mr. CALHOUN of S. C. said they had arrived at that part of the bill on 
 which he presumed there would be the greatest diversity of opinion. The 
 subject was highly important and worthy of mature consideration; he, there- 
 fore, moved That the committee now rise, to allow time for further reflection 
 on it. 
 
 The committee rose, and the House adjourned. 
 
 NOVEMBER 1C, 1814. 
 
 The House resumed, in committee of the whole, the consideration of the 
 bill. 
 
 At the request of Mr. CALHOUN, of South Carolina, who desired to propose 
 another amendment, Mr. BKADBURY, of Massachusetts, withdrew the amend- 
 ment he ottered yesterday. A great part of his object, he said, had been an- 
 swered by arresting the attention of the committee to this subject. 
 
 Mr. CALHOUN, then, in a very ingenious and elaborate speech, laid before the 
 House his views on this subject, and the reasons why he should propose a total 
 change in the features of the bill. The motion he now made was one of limited 
 character, but such a one as he proposed to follow up byother amendments, or, 
 by distinct legislative provisions, which should together embrace a plan, of 
 which the following is a brief outline: The capital of the bank remaining un 
 changed, at fifty millions, the payments of subscriptions to this capital stock- 
 to be made in the proportion ot one-tenth in specie, (which he afterwards va- 
 ried to six-fiftieths) and the remainder in specie, or in treasury notes, to be 
 hereafter issued; subscriptions to be opened monthly, in the three last 
 days of each month, beginning with January next, for certain proportions of 
 the stock, until the whole is subscribed; payment to be made at the time of 
 subscribing; the shares to consist of one hundred instead of five hundred dol- 
 lars, each: the United States to hold no stock in the bank, have no agency in 
 its disposal, nor control over its operations, nor right to suspend specie pay- 
 ments. The amount of treasury notes to be subscribed, viz. forty-five mil- 
 lions, to be provided for by future acts of Congress, and to be disposed of in 
 something like the following way, viz: Fifteen millions of the amount to be 
 placed in the hands of the agents, appointed for the purpose, or in the hands 
 of the present commissioners of the sinking fund, to go into the stock mar- 
 ket, to convert the treasury notes into stock; another sum, say five millions, 
 to be applied to the redemption of the treasury notes becoming due at the 
 commencement of the ensuing year; the remaining twenty millions he pro- 
 
496 BANK OP THE UNITED STATES. 
 
 posed to throw into circulation as widely as possible- They might be issued 
 in such proportions, monthly, as to be absorbed in the subscriptions to the 
 bank, at the end of each month, &c. This operation, he presumed, would 
 raise the value of treasury notes, perhaps twenty or thirty per cent, above par, 
 being the value of the privilege of taking the bank stock, and thus afford, at 
 the same time, a bonus and an indirect loan to the Government; making 
 unnecessary any loan by the bank, until its extended circulation of paper 
 shall enable it "to make a loan which shall be advantageous to the United 
 States. The treasury notes so to be issued to be redeemable in stock, at six per 
 cent., disposable by the bank at its pleasure, and without the sanction of Go- 
 vernment; to whom neither is the bank to be compelled to loan any money. 
 This, it is believed, is, in a few words, a lair statement of the /wye/ of Mr. 
 Calhoun, which he supported by a variety of explanations of its operations, 
 &c. the notes of the bank, \v\\en in operation, to be received exclusively in 
 the payment of all taxes, duties, and debts, to the United States. The opera- 
 tion of this combined plan, Mr. C. conceived, would be to aftbrd, 1. Relief 
 from the immediate pressure on the treasury; 2. A permanent elevation of 
 the public credit; and 3. A permanent and safe circulating medium of gene- 
 ral credit. The bank should go into operation, he proposed, in April next. 
 He concluded his exposition by a motion, the effect of which is to deprive the 
 United States of any share in the stock of the bank, and to change the pro- 
 portions of specie and paper, in which it shall be payable, to one-tenth in spe- 
 cie, and nine-tenths in treasury notes. 
 
 This motion opened a wide and interesting scene of debate. 
 
 Mr. FISK attacked Mr. CALHOUN'S proposition with considerable zeal, prin- 
 cipally on two points; its failure to provide for the present absorption of 
 United States' stock, and the difficulty which would occur in the circulation 
 and disposal of so immense a mass of treasury notes. He drew a comparison 
 between Mr. CALHOUN*sprq/e/and that of the" Committee of Ways and Means, 
 highly favorable to the latter. 
 
 Mr. FORSYTH, of Georgia, opposed the adoption of this proposition, and ex- 
 amined the features of the amendment proposed by Mr. CALHOUN, and the ar- 
 guments advanced in favor of it. He was opposed to it in nearly all its fea- 
 tures, and greatly preferred the plan reported by the Committee of Ways and 
 Means. His arguments were principally in reply to those of Mr. CALHOUN, 
 which he generally pronounced to be erroneous and delusive. 
 
 Mr. LOWNDES, of South Carolina, replied, at considerable length, to Mr. 
 FORSYTH, and vindicated the proposition of Mr. CALHOUN, in an able argument 
 on the principal points of objection, urged by Mr. FORSYTH, and in illustration 
 of the principles of the bill. He showed what he believed a decided superi- 
 ority or the amendment over the original project of the Committee of Ways 
 and Means. 
 
 When Mr. L. ended his speech, the debate on the main question termi- 
 nated, and this day's sitting ended with the following skirmishing debate, du- 
 ring the whole of which, the Chairman and the members of the House were 
 endeavoring to limit the debate to the question before the House. 
 
 Mr. OAKLEY, of New York, after remarking on the very high importance of 
 this subject, and the magnitude of the change which this amendment proposed 
 to introduce into the principles of the bill, and the obvious necessity ot fur- 
 ther time for the consideration of so important an amendment, moved that the 
 committee rise, report progress, arid ask leave to sit again. 
 
 Mr. IXGHAM, of Pennsylvania, opposed this motion. He feared, if the 
 House were to adjourn without deciding on this motion, coining from the im- 
 posing quarter whence it did, and supported with so much ability by the gen- 
 tleman from South Carolina, it would arrest the loan of three millions, and 
 
PROCEEDINGS OF 1814. 40,7 
 
 even the nine millions loan, which were absolutely indispensable to support 
 the military establishment, and other departments of the Government. What, 
 then, he asked, would become of the soldier who is now in a northern clime, 
 depending on the fate of these loans for his pay, clothing, and sustenance? 
 Whoever, in the face of such considerations, should vote to rise without de- 
 ciding on this proposition, possessed, he said, more courage and philosophy of 
 temper than he would boast- He hoped the committee would not rise with- 
 out deciding on this motion. 
 
 Mr. GROSVEXOR, of New York, said he hoped the committee would rise. 
 This was the very question, how money should be raised, whether by treasury 
 bills or by any other mode, which more than any other required the deliberate 
 decision of Congress. It was not a question simply of paying the militia, or 
 Hit 1 army now out, but of establishing a system which should enable the Go- 
 vernment to discharge all the demands against it It was all important on 
 such a subject as this, more than on any other, to vote considerately, and after 
 deliberation. The proposition of the gentleman from South Carolina, he con- 
 sidered to be generally advantageous; but he had some objections to it which 
 lie wished an opportunity to submit. He hoped, before deciding on a subject 
 like this, the House would take due time to deliberate on a proposition to throw 
 into circulation fifty millions of treasury notes, trusting to the bank for their 
 absorption. 
 
 Mr. SHARP, of Kentucky, said he hoped the committee would not rise. He 
 wished, before rising, that they would decide upon the proposition before them; 
 not, however, for the reasons expressed by the gentleman from Pennsylvania. 
 He did not, like that gentleman, conceive that the decision on this amend- 
 ment could affect the loans; for one, he said, he protested against loans made, 
 or to be made, on the expectation of the creation of a bank to give a bonus to 
 the holders of the public stock, in addition to that which they have already 
 contracted to receive from the Government. It was important that some de- 
 cision on this subject should immediately take place, which had been already 
 three days debated; and he knew of no plan which would be so operative as 
 that now proposed by his friend from South Carolina, whose arguments, he 
 said, together with those of his colleague, (Mr. LOWNDES) were something 
 like mathematical-demonstration. 
 
 Mr. OAKLEY denied any weight to the remarks of the gentleman from Penn- 
 sylvania, and allowed almost as little to the argument of Mr. Sharp, that three 
 days had been consumed in the discussion of this subject He should, for his 
 part, say that three weeks might be well employed in the discussion of a pro- 
 ject for establishing a. bank with a capital of fifty millions of dollars a capital 
 sufficiently large to influence the destinies of this nation to future ages. He 
 was friendly to the main principles of Mr. Calhoun's proposition; but he was 
 not certain but there might be radical objections to some of them. He hoped 
 some indulgence would be afforded to those, who, like him, wished to deliver 
 their opinions on this subject. 
 
 Mr. INGHAM remarked that the House had been sitting here nine weeks, 
 and not a single measure had been definitively adopted for the support of the 
 public credit. Delay and procrastination had taken place day after day; and. 
 if the House were to wait until every gentleman was satisfied as to every word 
 and letter in a bill, the House would never get through one. The very sug- 
 gestion of such an amendment as that now under consideration, would, he 
 said, produce ill consequences. It ought to be determined, therefore, as early 
 as possible. He did know that a speech, (Mr. JACKSON'S) delivered in this 
 House, had depressed the price of stocks in Philadelphia, full two and a half 
 per cent. The proposition now before the House, he feared, would depress 
 them still further; and, when the public stock was in a state of depression, 
 going down, down, down, he was unwilling the House should take any course 
 which should still further prostrate it. 
 63 
 
498 BANK OF THE UNITED STATES. 
 
 Mr. FISK hoped the committee would not be induced to rise^ at the early 
 hour of three o'clock, by the old plea of want of time for consideration. It 
 was important now to act, and that the whole course of proceedings of the 
 House should be reformed, and one of greater energy and promptitude sub- 
 stituted. 
 
 Mr. GROSVENOR said this was no ordinary subject, on which men could 
 make up their minds in a moment; and, although some gentlemen might be 
 prepared to vote on it, he hoped they would allow some time to those who de- 
 sired to reflect before they voted on a question of so great moment. 
 
 The committee then rose, reported progress, and obtained leave to sit again. 
 
 NOVEMBER 17. 
 
 The House again in committee of the whole, Mr* NELSON in the chair; the 
 important amendment yesterday proposed by Mr. CALHOUX to the bill, being 
 still under consideration 
 
 An amendment was moved thereto by Mr. FISK, of New York, and ac- 
 cepted by the House, authorising the receipt of foreign gold and silver coin, 
 (as well as gold and silver coin of the United States) in payment for the sub- 
 scriptions to the stock of the bank at certain rates expressed in the amend - 
 ment. 
 
 Mr. WRIGHT, of Maryland, in the course of a few remarks on the motion 
 of Mr. CALHOUN, expressed his approbation of the principle, and avowed a 
 decided preference to the plan it embraced over that contained in the original 
 bill. 
 
 Mr. SHARP,, of Kentucky, moved to amend the bill so as to preclude any 
 thing but treasury'notes from being received in payment of the forty -four mil- 
 lions, which are now proposed to be payable in specie or in treasury notes. 
 His object was to prevent the latter payments into the bank from being made 
 by the aid of accommodation from the bank after it goes into operation. 
 
 After sonie conversation, Mr. S. withdrew his amendment with a view of 
 offering it in some future stage of the discussion. 
 
 MR. INGHAM. Mr. Chairman: As the question on the amendment proposed 
 by the gentleman from South Carolina, (Mr. CALHOUN) now recurs, I beg 
 leave to submit a few observations before it is decided. No member of this 
 committee, can be more sensible than I am, of the disadvantages I shall have 
 to contend with, in entering the lists against either of the honorable gentlemen 
 from South Carolina who have supported the amendment; and I am now fully 
 conscious, that I shall fail to communicate my ideas with that perspicuity, 
 which alone can give them their proper force and effect, yet, [ am embolden- 
 ed by the importance of the occasion, and shall rely upon the intelligence of the 
 committee and the subject itself, to supply all other deficiencies. The amend- 
 ment under consideration, taken in connexion with the suggestions of the 
 honorable mover, contemplates a radical change of all the principal features 
 of the bill reported by the Committee of Ways and Means. It will, therefore, 
 be necessary, in order to contrast the two plans, to notice that which has been 
 proposed by the committee, somewhat at large, though I shall endeavor to be 
 as brief as the subject will possibly admit, ft will be seen, that the only im- 
 portant features of the bill are: 1st, the amount of the capital stock; 2<l, the 
 character of it; 3d, loan to the Government of $30,000,000; and 4th, a qualified 
 power to suspend specie payments. To all these points, objections have been 
 urged, either by the gentleman from South Carolina or the gentleman from 
 North Carolina, (Mr. GASTON) and a particular examination of them, becomes 
 necessary as a preliminary to the examination of the amendment. First, 
 with respect to the amount of capital. The bill proposes a capital of fifty mil- 
 lions of dollars; it is sufficiently apparent, that the establishment of the pro- 
 pDsed bank, is designed as an instrument in aid of other measures; to revive 
 the public credit, and thereby enable the Government to procure the neces- 
 
PROCEEDINGS OF 1814. 49Q 
 
 &arv resources to prosecute the war with such effect as to bring a speedy and 
 honorable peace. But we find, that since the commencement ot the war, 
 the public stocks have suffered a gradual depression up to the present year, 
 when it seems that loans, on any terms, are totally at an end. 1 he reason of 
 this is obvious; we have borrowed and attempted to borrow too much, and 
 have not resorted, as we ought to have done, to a more enlarged system of 
 internal revenue. It is unnecessary to go back farther. What is the present 
 state of things? We find the market exhausted of the money and overloaded 
 with the public debt. In addition to this misfortune, we find, literally, no cir- 
 culating medium in the nation. What then is to be'done? You cannotborrow; 
 you cannot impose taxes to the extent of your demands, and even those which 
 are laid, cannot be paid in money that will answer the purposes of the Govern- 
 ment. The answer is plain; by withdrawing a portion of the encumbering 
 mass of stock from the market, you relieve it from its pressure; a pressure 
 which bids defiance to your efforts to penetrate it. But if, by this process, you 
 can convert this weight of debt into an instrument of credit, not only for those 
 interested in it, but for a great portion of the community, and also, for the 
 Government to an almost unlimited extent, and, at the same time, restore the 
 circulation of the money medium to its accustomed action, you have accom- 
 plished great and essential purposes. It is for these purposes, that this bill 
 was reported, and the amount named in it, fixed upon tor the capital of a na- 
 tional bank, that it might absorb such a mass of the encumbering stock as 
 would relieve the market; raise the price of debt not taken up: give facil- 
 ities to the obtaining of loans for the present year, and for each succeeding 
 year. And here, I would beg leave to remark, that an evident repugnance 
 has been manifested by some gentlemen, (which L will not, however, impute 
 to the honorable gentleman from South Carolina) to doing any thing to raise 
 the price of public stock, lest those who have purchased, at a low rate, should 
 be benefited. Permit me to inquire of tho.se who have no gratitude nor feeling 
 for public creditors vyho have loaned you their money in the time of your ne- 
 cessity, will you refrain from doing an act indispensably necessary for the 
 credit of the Government, and to enable it to borrow mom money, for fear 
 you do a benefit, not to call it an act of justice, to your creditors? I would 
 ask such gentlemen, how they expect to go into the market and sell stock for 
 eighty- eight, when that already sold, is every day to be bought for eighty? It 
 is humiliating to dwell upon a subject so plain and simple, and, but for the 
 strange declarations which I have heard, it would not have been noticed . Mr. 
 Chairman, there is no consideration to which every financier who is obliged to 
 anticipate his resources by loans, is more attentive to, than that of supporting 
 public credit; or, in other words, keeping up the price of stocks; the faithful 
 payment of interest, though indispensable, is not always sufficient. Sinking 
 funds have, therefore, been resorted to, but, as your power of establishing 
 sinking funds is limited, when we find, by a repetition of loans, we have over- 
 loadeclthe market, you must, if possible, withdraw that suplusage before you 
 can recommence your loaning operations, and even then, you must return to 
 the market with tliat caution which experience has indicated, as necessary to 
 your success. It is, therefore, that we propose to take out of the market, the 
 eighteen millions of stock and the six millions of treasury notes; and, as the 
 stocks are now selling at eighty, it was calculated, that an advance of twenty- 
 five per cent, upon twenty four millions of dollars, equalized, as it would be. 
 upon the whole amount of the debt in which subscriptions to the bank could 
 be made, (about eighty millions) might be computed to advance the whole of 
 these depressed stocks to about eighty-eight. The sum proposed to be absorb- 
 ed, therefore, was the least amount that could, consistent with the plan, have 
 been taken. But, there is another reason why a large capital was determined 
 upon. We propose, for the sake of mutual benefits to the bank and the Go- 
 vernment, to give it great facilities in the circulation of its notes. In fact, 
 this will be almost the only medium which can be employed for the payment 
 of taxes, or to carry on the ordinary commercial intercourse between people 
 of different States, those of most of the State banks being now exclusively 
 
500 BANK OF THE UNITED STATES. 
 
 confined to a circumscribed atmosphere around the bank from which they issu- 
 ed. With these facilities, it is apparent, that the bank may issue considerable 
 quantities of paper, and, it was much safer to make the capital of the bank 
 exceed the amount of notes which the demand for circulating medium would 
 enable it to issue, than, that it should have power to contract debts equal to 
 its capital. And here, it should be observed, that a bank with a small capital, 
 possessing, in all other respects, the same facilities with a bank with a large 
 capital- specie payments being suspended will be able to issue nearly, if not 
 exactly, the same quantity of paper. It, therefore, becomes necessary for the 
 security of the creditors of such a bank, that it should have a large capital. 
 I heard the honorable gentleman from South Carolina, (Mr. CALHOUN) with 
 some degree of astonishment, yesterday, state, that a bank of one million of 
 dollars, could, with safety, issue paper to the amount of two or three millions- 
 I would ask him, what would be the situation of an individual whose debts 
 three times exceeded his whole real and personal estate? He would be insol- 
 vent, and so would the bank. No bank, conducted with integrity, ever did 
 issue notes to the amount of its capital ; and no bank, that has any regard to its 
 reputation, will ever dare to do it. , The gentleman has, probably, confounded 
 discounts and emission together an error into which many others have been 
 led before him. Although these operations are intimately connected, yet, 
 they are extremely different in their nature; the one constitutes the debts due 
 to the bank, while the other constitutes the debts due by the bank. The 
 gentleman, and every member of the committee, will see the distinction, and 
 it will be unnecessary further to illustrate it. I think, it has been sufficiently 
 shown, that a bank, with a capital much less than fifty millions, could not,, 
 with safety, issue, upon the customary mode of bank operation, notes to meet 
 the present demands for circulating medium and preserve an adequate security 
 to its creditors. It is, I believe, unusual for the large State banks to issue, in 
 paper, more than one-third, qr^at most one-half, the amount of their capital t 
 although they often loan or discount to the whole amount. 
 
 The next point which presents itself for consideration, is the character of 
 the capital. It is proposed to be constituted of twenty-four millions of public 
 debt, that have accrued since March, 1812, or, that is now authorized to be 
 created. Eighteen millions of dollars of this, will be six p"er cent, stock, and 
 six millions of dollars in treasury notes now issued or to be issued in pursuance 
 of existing laws. Twenty millions to be subscribed by the Government, and 
 paid in six per cent, stock, and six millions in specie. The objections that 
 nave been urged to the character of this capital, are worthy of some particular 
 notice. We are told, "that it is nothing more than a paper bank;" 
 " that it is not entitled to credits" that " its paper will not circulate, 
 having no security for its solvency, but the obligation of the Govern- 
 ment to pay its debts." It is, perhaps, fortunate for the friends of this bill,, 
 that they have the light of experience to justify their expectations and calcu- 
 lations on this subject. Is there not a strong resemblance between the cha- 
 racter of this capital and that of the old United States' Bank? The amount 
 and proportions are somewhat variant, but the essentials are precisely the 
 same, and when was the validity of that paper questioned? It is true, specie 
 payments were not suspended, but every body knew, that, while it was doing 
 business upon a capital of ten millions of dollars, issuing notes to the amount 
 of five to six millions, its specie capital only amounted to two millions live 
 hundred thousand dollars, and no difficulties were ever experienced for want of 
 more specie, that I have heard of. In ordinary times, there is very little oc- 
 casion for specie in banking operations; none is wanted except for the payment 
 of balances between the merchants of different cities, between different banks, 
 and the small change required by retailers. And the amount of specie re- 
 quired for these purposes, does not increase in proportion to the amount of bank- 
 ing capital employed in the country. As an evidence of this fact, we may refer 
 to the operations performed by the Bank of England. The amount of pay- 
 ments made every day by the different banks of London, is estimated to ex- 
 ceed four millions sterling, and in the year 1810, the whole amount of notes- 
 
PROCEEDINGS OF 1814. 501 
 
 of the Bank ot England and private banks, in circulation, amounted to se- 
 venty-nine millions sterling, while the specie only amounted to four millions. 
 It may be fairly inferred, that the credit of a bank does not depend upon the 
 amount of specie in its vaults, no more than the credit of a merchant depends 
 upon the amount of money he keeps in his desk. His visible estate, his in- 
 come, and his integrity, are the foundation of his credit, and it is the same 
 with the bank; the visible estate of which, is the public debt and specie, its 
 inc9me is the interest arising therefrom, and from loans to Government and 
 individuals. And the caution that will be exercised in the selection of direc- 
 tors, will, no doubt, as has almost universally been the case, especially in 
 the large banks, ensure a faithful and judicious management ot its attairs. 
 But, we are told the only security for its paper is the obligation of the Govern- 
 ment to pay its debts! And are we to be gravely told, that this is no secu- 
 rity? 1 never can, for a moment, believe that this security will be question- 
 ed, regarding, as every man in the nation does, the obligations of the Govern- 
 ment to its creditors, of so solemn and unchangeable a character that, let 
 whatever may happen, they must be fulfilled in good faith. In addition to 
 these considerations, the credit which the paper of the bank will receive in 
 payment of taxes and customs, and the imperious necessity which exists for a 
 circulating medium that will be co-extensive with the States, will ensure the 
 circulation of the paper, and there cannot exist a rational doubt of its credit 
 being maintained without depreciation, answering all the valuable purposes 
 that are expected from it both for the Government and the community. But 
 here we are met by another objection, viz: that the enormous loan, as it has 
 been called, of thirty millions to be made to the Government, will produce 
 a run upon the bank that will exhaust all its specie and arrest its future opera- 
 tion-. In the first place, it is not to be presumed, that the Government will 
 do any act that will embarrass the bank, being, as it always must be, so deeply 
 interested in its preservation. The loan will, therefore, be av.ked for accord- 
 ing to the terms of the bill, in such sums and at such periods as may be made 
 mutually convenient and consistent with the objects of the Government. 
 And there is no doubt, but the Government would regard this resource as a 
 reserve only to be used in time of particular necessity, when the depression of 
 stocks should forbid them from going at large into the market. At any rate, 
 the amount would not be required, as it could not be wanted, in large sums. 
 And such of th"se as would be drawn out of the bank, would mostly find 
 their way into it again before another payment would be demanded; a portion 
 would return in tuxes and other portions in payment of debts due from the 
 country to the city merchants, and a very considerable part of this loan would, 
 like ordinary loans or discounts, as they are called, to individuals, never get 
 from the drawer of the bank, but merely pass from the credit to the debtor 
 side of its'books. Under this view ot the subject, which exhibits the necessay 
 and natural operations, it will be admitted, that not so much danger exists 
 from this loan, as some gentlemen seem to apprehend. But should any unex- 
 pected difficulties menace the bank, there will be a resort to the power of 
 suspending specie payments. But this provision has also been objected to, 
 and almost in the same breath, we are told, that no bank can exist with the 
 usive operations designed tor this, with an obligation to make specie pay- 
 ments. But the objectors have not furnished us with an alternative. [ do 
 not apprehend any serious consequence will result from the temporary sus- 
 pension of specie payments. The experiment was tried many years ago in 
 England, and has been continued up to this time, without injury to the com- 
 mercial interests and with essential benefit to the nation at large. It has also 
 been tried here, and, although bank paper is somewhat depreciated thereby, it 
 is solely because it will not ansvyer the purpose of paying balances between 
 people of different States, for which specie had usually been employed. For 
 example, the bank paper of this District will not enable you to trade east of 
 Baltimore; yet, every article to be purchased with it here, is as cheap as it 
 was twelve months ago. It may, therefore, be fairly inferred, that a paper 
 which was receivable all over the United States, in taxes, and might be ex- 
 
502 BANK OF THE UNITED STATES. 
 
 changed for notes of smaller or greater denomination, or treasury notes in 
 each of the States would, from its general convenience, continue to circulate 
 without depreciation, even though a temporary suspension of specie payments 
 should take place. It has already been shown that, but a small quantity of 
 specie is actually necessary, when the People have faith in the capital, the 
 income, and the integrity of the bank; and in this case, necessity would be- 
 come an auxiliary to faith, and business would go on as usual. But further: 
 Is it not probable that most of the moneyed capitalists in the United States 
 would vest a portion of their disposable funds in this bank, as also a number 
 of the State banks? and will not all these be interested in the support of the 
 credit of its paper? I do not believe it possible, for any hostile combination 
 to resist their influence in money transactions, when thus united and thus in- 
 terested. And from every view that can be taken of the subject, there does 
 not appear any rational doubt of the success of the plan proposed by the com- 
 mittee in answering all (he valuable purposes for which it was designed. The 
 plan has been, fora considerable time, before the public, and although some have 
 objected to the amount of the specie called for by the bill as being difficult to pro- 
 cure and unnecessary, it has met the approbation of the most intelligent men in 
 this community, (as to money matters I mean) to say nothing of the mature and 
 deliberate consideration which has been given to it by the able and enlightened 
 statesman at the head of the Treasury Department, who, relying upon the sup- 
 port of Congress, has assumed the high responsibility of his station with a degree 
 of energy and confidence that does no less honor to himself, than it promised to 
 do service to the country; to say nothing of the discussion and consideration 
 which has been given to this subject by the Committee of Ways and Means, 
 for whom, although no more confidence should be claimed than lor any like 
 number of the members of the House, yet, their duty, their great responsi- 
 bility, could not fail to produce a laborious examination of the plan. But, we 
 are not without experience a,s to its influence. The stocks had began to ad- 
 vance, of course public credit was reviving, and some loans were actually ne- 
 gotiating for the relief of the present quarter, in anticipation of the success 
 of this bill, to carry into effect the general plan of finance submitted to Con- 
 gress by the Secretary of the Treasury. Such was the progress of pur fiscal 
 operations, and we were emerging, as it were, from a dense cloud of difficul- 
 ties and embarrassments that hung over the nation. A more extensive and 
 efficient system of finance than any ever adopted in this country, was pro- 
 gressing to maturity as rapidly as circumstances would admit: and the bill 
 under consideration, an indispensable instrument to carry it into effect, had 
 progressed with a flattering prospect of success; and behold, at a crisis so 
 eventful, we are met by a proposition which goes (to use the expression of the 
 gentleman from South Carolina) to effect a radical change in the whole sys- 
 tem of the bill reported by the Committee of Ways and Means. I shall say 
 nothing farther as to the time and manner of this proposition; but I trust it 
 will appear to have been suggested without due consideration, as it has been 
 without concert or consultation; and, however plausible in theory, that it is 
 impracticable in its details, and will be injurious in its effects. In attempting 
 to investigate this new plan, we are subjected to considerable difficulties on 
 the threshold, because it has neither assumed form nor shape. The plan can 
 therefore only be collected from the suggestion of the honorable gentleman in 
 his speech yesterday, except so far as it is found in the amendment on the ta- 
 ble, which only appears to be a small patch of the scheme. That the scheme 
 is crude and undigested, there can be little doubt, when we recollect the 
 changes that have been proposed or consented toby the mover, since it made 
 its appearance in the committee yesterday; but I will proceed to examine it. 
 The plan proposes to constitute the bank upon a basis of six millions of spe- 
 cie, and forty -four millions of treasury notes; these notes hereafter to be is- 
 sued, and when subscribed to the bank, to be exchanged for six per cent, 
 stock at par; fifteen millions of the forty-four to be placed in the hands of the 
 commissioners of the sinking fund; and to carry the plan into effect, a law 
 must be passed to authorize the issuing of the treasury notes, and another law 
 
PROCEEDINGS OF 1814. 
 
 10 dispose of the fifteen millions in the hands of the commissioners of the 
 sinking fund, and as there may be a great difference of opinion as to these ul- 
 terior measures between the branches of Congress, the possibility of a failure 
 to pass these laws, presents a strong objection to the plan. We already find 
 a difference of opinion between the two gentlemen from South Carolina who 
 have supported the amendment; one of them (Mr. LOWNDES) altogether dis- 
 approves of placing fifteen millions of notes in the hands of the commissioners 
 ot the sinking fund, to be exchanged for six per cent, stock, and subscribed 
 to the bank, t shall presently consider this part of the subject, with refer- 
 ence to both their schemes, and, in the mean time, recur to the proposition to 
 issue either the forty-four or the twenty-nine millions of treasury notes, for 
 the purpose of being subscribed to the bank; and it may here be observed, that 
 the treasury notes are not, as some seem to think, calculated for a circulating 
 medium, nor can they ever be made to supply its place; it is an evidence of 
 debt bearing interest in no essential particular different from the public stocks, 
 except that the former is made payable monthly at the end of a year, while 
 the latter are redeemable at a longer period; the interest that accrues retards, 
 instead of accelerating the circulation, and it must partake of all the essen- 
 tial qualities of capital- If, therefore, you issue a sum of treasury notes, you 
 make virtually a loan to that amount, and especially if they are not to be re- 
 paid, as in the present case, at the end of the year: the money market is as 
 much exhausted by the operation, as if six per cent, stock is sold to the same 
 amount; it is, therefore, fair, to consider this enormous emission of treasury 
 notes as a loan, which, by offering extraordinary inducements, you calculate 
 to effect. Now, in order to judge of the propriety of this measure at this 
 time, we must consider the state of the money market, and also what consti- 
 tutes the capacity of a people to loan to their Government. It has already 
 been observed, that the market is overcharged with stocks, and each succeed- 
 ing loan has (except in one instance) been obtained on more unfavorable terms 
 than the former. It must be evident, therefore, that we have attempted to 
 borrow, and that we have borrowed too much in proportion to the provisions 
 that have been made to redeem, especially when we consider the stagnation of 
 the medium. The stock market is glutted and overloaded, and you may buy 
 stocks in it at a much cheaper rate than the Government ought to sell them. 
 Is it then prudent, or wise, to force out at such a time, in one year, the enor- 
 mous sum of forty -four millions of new stock, to accumulate this new insup- 
 portable burthen on the market? It should be recollected, that the amount 
 which the people can loan to their Government, within a given time, can never 
 exceed the amount of their nett profits for the same time; and in a country 
 like this, where there are so many avenues to wealth by the reinvestment of 
 the yearly profits in capital, either by enlarging existing establishments, or en- 
 gaging in new employments, it cannot be expected that any very considerable 
 pun ion of the annual profits can be borrowed, without giving a high premium 
 For them. But, at this particular time, when, owing to the interruption of all 
 business, by the stoppage of specie payments by the banks, and the consequent 
 location of their paper to a very limited boundary, it cannot be expected that 
 the habits of industry, or means of loaning, can be near as great as they will 
 be when the circulating medium of the country shall resume its accustomed 
 activity. If these premises are correct, the conclusion is inevitable, that it 
 would not only be unwise and impolitic to press so great a loan, as it were, by 
 force, upon the market at this time, but that it would be much more safe and 
 prudent to withdraw a part of the stocks from the market, and abstain, if pos- 
 sible, from pressing it again, until it shall have become relieved by the income 
 of the succeeding year. Hence it is, that we propose to require the bank to 
 loan money to the Government, a part of which would perhaps be required for 
 the next year, and the remainder reserved for similar exigencies. But the 
 honorable gentleman from South Carolina calculates to obviate all difficulties 
 and embarrassments for two years, by the sale of the twenty-nine or the forty- 
 four millions of treasury notes, which he calculates will readily be sold at par, 
 nay, even at a premium. Now, as the amendment stood when he delivered 
 
504 BANK OF THE UNITED STATES. 
 
 his speech, and as it now stands, (although I am aware of the proposition of 
 the honorable gentleman from Kentucky, to require payments for the bank 
 subscription to be made in the treasury notes only, to the amount of forty-four 
 millions, which he had thought proper, however, on reflection, to withdraw, 
 and which, upon more mature reflection, I am sure lie will not renew) as the 
 amendment now stands, the payments may be made in treasury notes, or gold 
 and silver. And how will treasury notes be sold for specie or bank notes ol" 
 equal value, at a premium or at par, when the specie can be paid directly into 
 the bank? The thing is too absurd to dwell upon for a moment. But, per- 
 haps we shall be told that the subscriptions for the forty-four millions must 
 be paid in treasury notes only. I can hardly think it possible that the honora- 
 ble gentleman, with all his courage, would venture upon such a measure to 
 force his treasury notes into the market; it would be little better than a ten- 
 der law in principle, and in its operation most iniquitous and injurious to the 
 success of his plan. For instance, an individual being in possession of spe- 
 cie, must be compelled to buy treasury notes before he can subscribe to the 
 bank; thus preventing specie from finding its way into a bank, which must 
 always continue its specie payments, and he must be subjected to the risk of 
 not being able to secure the amount of his subscription to the bank; in which 
 case there will no doubt be a loss upon the treasury notes that are not absorbed, 
 and of course the less inducement to buy them. But it does not appear to 
 me, that the treasury notes can be sold to the amount proposed. How are 
 they to be paid for? Specie cannot be found: will you sell them for bank 
 notes? One half of these, if the treasury notes are distributed over the 
 States for sale, as the gentleman proposes, will answer the Government no 
 purpose. It has now near three millions of southern notes, which must be 
 applied to the payment of the interest on the public debt in Boston; nor can 
 the notes of Baltimore be certainly applied to the payment of debts even in 
 Philadelphia. How then can these forty-four millions of treasury notes be 
 sold for a valuable consideration in any State where the taxes exceed the dis- 
 bursements of the Government, and in which the banks do not pay specie? 
 The gentlemen of this House may, perhaps, take a few of their per diems 
 home in treasury notes; but it will be impossible to distribute them, when 
 the credit of the Government exceeds its debts, unless you give them away. 
 But the gentleman proposes to reduce the denomination; and what will this 
 avail his plan? A few of them may be picked up by hucksters and tin- 
 pedlars, and there it will end. You cannot pay money where you do not 
 owe it, nor sell treasury notes to people who have no money to buy them with, 
 or whose money answers you no purpose. I conclude thus far that the scheme 
 is unwise, impolitic, and impracticable. But suppose it were possible to car- 
 ry it into effect, what is its moral character and its effect upon public credit? 
 I do not mean to impeach the motives or moral principles of the honorable 
 gentlemen who have advocated this plan of a bank; I know they are utterly 
 incapable of supporting any measure of which they entertain a doubt as to its 
 strict moral propriety; but, thinking differently from them in this particular, 
 I shall be excused for explaining my views of it. It has already been stated 
 that the stocks are in a state of heavy depression; and it may be added, that 
 those who have given you one hundred dollars in specie for one hundred dol- 
 lars in stock, cannot now sell the same for more than eighty dollars so of 
 those who have given you eighty- eight for one hundred. This depression is 
 not the fault of the creditor; it is his misfortune; and when the Government 
 can, without injury to itself either do a benefit to its creditors thus circum- 
 stanced, or avoid doing them an injury, it is bound by every moral obligation 
 so to do. But what wdl be the effect of the measure under consideration? 
 We iind the stock market glutted; the public creditor sinking under his bur- 
 dens, and, without any occasion whatever, we accumulate an additional mass 
 upon him, and consummate his ruin. But, says the honorable gentleman from 
 South Carolina, (Mr. CALHOUN) fifteen millions of treasury notes shall be ap- 
 plied to purchase up the depressed stocks; that is, he will offer seventy-five or 
 eighty dollars in treasury notes for a certificate which purports on its face to 
 
PROCEEDINGS OF 1814. 5Q5 
 
 demand one hundred dollars in specie. But this is not all; by our own act, 
 we first depress the price, and depreciate the value of our debt, and then, by 
 the aid of some speculating; scheme, we buy up that debt at its depreciated 
 rates, just like same swindling traders in our cities, who, when their credit 
 is exhausted, shut up shop, and send out runners to buy up their notes at forty 
 or fifty per cent discount. Such is, to my mind, the character of the trans- 
 action. But one honorable gentleman from South Carolina (Mr. LOWNDES) 
 is opposed to this part of the plan; he will not employ any part of the intended 
 capital of this bank to purchase up the depressed stocks. So much the worse. 
 The public creditor would then nave no remedy for even a part of his misfor- 
 tunes, and the Government, in such a case, would act the part of a spendthrift, 
 whose land could not be sold for debt, and while he was giving usurious ad- 
 vantages to obtain new credit, he would doty his old ones, and mock at their 
 complaints. I am aware that many plausible things may be said to show what 
 are the obligations of the Government to its creditors, and thattliey may be 
 fulfilled according to the terms of the contract, without being noticed in this 
 bill. Be it so; but, T contend that you are attempting to effect by indirect 
 means, what you would not venture to do by direct means; that is, to obtain 
 from the public creditor your obligation for a less amount than you promise 
 upon the face of it to pay him. He will not be satisfied with special plead- 
 ings and logic; he will realize his misfortunes, and execrate his wrong-doers. 
 \\hen his children cry for bread, his answer will be, I loaned my country; 1 
 confided in her justice; but, in an unlucky hour, her councils were guided by 
 logicians, and 1 am ruined. But there is another feature in the new plan, 
 which constitutes an insuperable objection. Specie payments are to be made 
 absolute. If we did not know that necessity sometimes requires a suspension 
 of specie payments by banks both at home and abroad, and that it may be 
 done without that terrible danger which some affect to apprehend, there would 
 be some reason to refuse making any provision for the case; but, with all this 
 light, and the existing condition of the specie medium of the country in full 
 view before us, it would seem to be a species of frantic enthusiasm, not to pro- 
 vide for the case. If bank credit can be restored, and it has not been essen- 
 tially impaired, there will be a better opportunity to doit under the power to 
 suspend the specie payments, guarded as it is, than there would be in any 
 other way. But, suppose the balance of tiade to continue strongly against 
 us, and a high premium for specie to be given by our enemy. Your bank will 
 become an instrument by which it will be drained from the country; and it 
 may happen, and probably wiU happen, that their specie payments cannot be 
 discontinued, and what will then be the situation of the bank? Failing to 
 fulfil the purposes designed, its credit is blighted, its operations are stopped, 
 and its charter violated; and if this should take place, before your treasury 
 notes are sold, the Government will scarce obtain a moment's relief; but, if 
 the treasury notes have been forced out, will they not come back upon the Go- 
 vernment for payment, when it has no means to redeem them, instead of pass- 
 ing into the drawer of a broken bank? 
 
 The patience of (lie committee is no doubt exhausted, and I will conclude 
 by exhibiting the relative pecuniary value of the two plans, in a calculation 
 that cannot be misunderstood. 
 
 By the scheme of the honorable gentleman from South Carolina, suppose 
 that you succeed in issuing the forty-four millions of dollars in treasury notes 
 at par, whether to be vested in stock, or for the purpose of a direct subscrip- 
 tion into the bank, and suppose, too, that the fifteen millions of treasury notes 
 will purchase one hundred dollars ot stock for eighty dollars of notes; the 
 advance or profit obtained in the operation, will be the difference between the 
 present price that is paid for money, and the rate thus obtained, viz. twenty- 
 jive per cent., which, upon forty-four millions, will be eleven millions. This 
 is the utmost that can be claimed for his plan, if it succeeds. 
 
 Now, by the plan proposed by the bill, we have the same advance upon 
 6,000,000 treasury notes, viz. - $1,500,000 
 
 Twenty -five per cent, upon a loan of $30,000,000. 7.500.000 
 
 64 
 
506 BANK OT? T HE UNITED STATES. 
 
 And, if we suppose our bank stock to advance twenty percent, 
 above par, it will make a disposable capital of $25,000,000, to 
 obtain which, we should be obliged at the present rates to pay a 
 premium of $6,250,000. G,250,000 
 
 Which, together with the advance on the stock, - 5,000,000 
 
 Will make a nettgain to the Government, of - $20,250,000 
 
 Making a difference in favor of the Government, by the bill as reported by 
 the Committee of Ways and Means, of $9,250,000. 
 
 This is a plain arithmetical fact, that cannot be controverted. The figures 
 will speak for themselves, and every member of the committee may make the 
 calculations for himself. But I can scarcely hope to convince the honorable 
 gentleman from South Carolina. He appears to be so enthusiastically attach- 
 ed to his proposition, that he has called in the aid of his prophetic spirit to sus- 
 tain him, and has painted in glowing colors the prospect of the blockade being 
 raised, and the speedy restoration of our foreign commerce and coasting trade 
 to their accustomed activity. But I cannot rely upon anticipations of this 
 kind, though I have often listened with pleasure to them. I have heard of 
 his prophecies before, and recollect listening with pleasure, though with some 
 degree of scepticism, to a speech of his, highly colored with promising pros- 
 pects, on a bill which has contributed to produce, more than any other cause, 
 our present fiscal embarrassments. It does appear to me, that the wisest 
 course would be, not to yield to visionary speculations, nor to adapt our mea- 
 sures to a state of things not likely to be realized. We have been trying ex- 
 pedients too long. Solid, substantial, and lasting measures, are now indis- 
 pensable. Such is the character of the proposition contained in the bill; while 
 the amendment proposed totally changes its character as well as form. That 
 which was designed as an agent to revive public credit, to supply the present 
 exigence of the country, and give such facility in obtaining future loans, as 
 would enable us to prosecute this war with vigor and effect, is to be convert- 
 ed into a machine to squeeze a little depreciated money out of the People for 
 the present; abandoning the other great and important objects so indispensa- 
 bly necessary to be effected. 
 
 I beg pardon of the committee for having trespassed so long upon their pa- 
 tience, and the only apology that can be offered, is the importance of the sub- 
 ject. 
 
 Mr. INGERSOLI/S speech against Mr. CALHOUN'S amendment. 
 
 Mr. INGERSOLL said, that he inserted himself into this debate with great 
 reluctance, almost in despair reluctance to take part in a discussion for 
 which he had no inclination, and which he thought had better be left to the 
 members of the committee who had reported the bill 5 in despair, because he 
 had no hope of making any impression on an assembly but too studious of 
 change, too fond of novelty, too apt to think that national wealth was most 
 certainly to be found in individual impoverishment. Ever since this war was 
 declared, and, indeed, since the session of Congress preceding it, the nation 
 had been kept alive on sickly hopes of peace, and the em pyrical sustenance of 
 inadequate loans; and it was not till just now, when these flattering unctions 
 were no longer applicable, that we had made up our minds to the solid food of 
 heavy taxes, pledges of them in sinking funds and a national banking institu- 
 tion. For his part, Mr. I. said, that he had uniformly denied and deprecated 
 the effects anticipated from the Russian mediation, as well as those of the ne- 
 gociation subsequently translated from Gottenburg to Ghent. These always 
 appeared to him to be the beau ideal of our foreign relations. He had never 
 ceased to remonstrate against abstracting an eminent person from the head 
 of the Treasury Department, to send him to make the grand tour of Europe 
 in pursuit of peace. I have invariably thought and said, (said Mr. INGERSOLL) 
 that the only policy was that just indicated by my friend and colleague who 
 preceded me. (Mr. INGHAM) to look the difficulties manfully in the face, con- 
 
.s or LSI*. 597 
 
 cene thrm at their worst, ami deal with them accordingly. We have at last 
 route lo this complexion, and 1 congratulate the country on the occasion. We 
 never should have had peace till war was waged in earnest; and perhaps we 
 are now much nearer to a termination of hostilities, than we were while sub- 
 sisting on pacific overtures. 
 
 The Treasuiy Department, in concert, and after long consideration, with 
 the committee of Ways aud Means, assuming the responsibility of their res- 
 pective stations, have recommended to us the plan of a bank, which is com- 
 prehended in the bill under discussion. In this Congress of ambassadors, as 
 1 think it was the late President Adams, (in his Treatise on the Constitution) 
 very aptly denominates us, rather than a Congress of the representatives of 
 different portions of the same people, it should always be the first preliminary 
 to entering upon any subject, the tint: ijua non (since nine qua nons are so 
 much the mode at modem Congresses) to agree by mutual sacrifices of the 
 pride of opinion, and the spirit of system, to endeavor to attain some practi 
 cable object and result. It is well known to every member, that a national 
 bank, while nearly all acknowledge the imperious necessity of such an esta- 
 blishment, has to "encounter the various obstacles and collisions which arise 
 from various quarters of this House. In the first place, it is to be opposed by 
 those gentlemen -on the opposite side, who, deeming this war unjust in its 
 origin, deem it, moreover, a constitutional ami correct orbit of opposition, to 
 move indiscriminately against every measure calculated to act in furtherance 
 of the war. 1 will not take upon myself to determine, whether this is a pro- 
 per view of the subject. \\Vatall events know that it is one mo>t stead 
 lastly adherred to. In the next place, a bank is resisted by certain scruples 
 respecting the constitutional power of Congress to create oue, which obtain 
 with several gentlemen on this side of the House. And lastly, it cannot be 
 doubted but that the most powerful, pervading, and indefatigable hostility out 
 of doors, will be organ'r/.ed by the innumerable State banking institutions: 
 which comprehend within the sphere of their influence, almost every man of 
 property in the country, who may apprehend that a Hank of the V'nited States 
 would tend to curtail, to cripple, or to destroy their resources. As long, how- 
 ever, as the objections urged on this floor were confined to those which might 
 have been expected, and which may be urged against all such establishments, 
 1 did not suppose it incumbent on any member, to assist those gentlemen of 
 the committee who have the particular conveyance of this bill through the 
 House, 1 should not have presumed, therefore, to mingle in the debate in 
 reply to such objections. Indeed, the grounds which were eloquently occu- 
 pied by the gentleman from North Carolina, (Mr. GASTOX) seemed to me to 
 toe sufficiently answered by himself: for I really think that there were few of 
 the difficulties which he recapitulated against the proposed plan, that are not 
 in equal force of existence against the substitute he su^gosted. As to plans, 
 indeed I am not myself at all tenacious. Any plan will answer my purposes, 
 that promises to restore public credit and create a circulating medium. Nor 
 can we, to be sure, complain of any deficiency of projects. Almost every 
 gentleman has his own; and if you happen to look into a newspaper ecce 7/omo, 
 here is a daily column of most comfortable schemes ready printed for your 
 perusal, [in allusion to a voluminous writer on these subjects in the National 
 Intelligencer, who affixed the signature of Homo to his essays.] It affords 
 me pleasure to bear testimony to the satisfaction with which i followed the 
 gentleman from South Carolina, (Mr. CALHOUN) in the developement of his 
 substitute for the system recommended by the Treasury Department. I must 
 do that gentleman the justice to say, that his views were exhibited in a clear, 
 connected, and well digested discourse, on this abstruse and complicated sub 
 ject, in which he unquestionably showed, at least, his own preparation and 
 capacity for explaining and supporting any favorite project he may choose to 
 introduce; and while I declare my unequivocal opinion, that his appears to 
 me to be the most fantastic, impracticable, and, I will add, pernicious, of all 
 the plans we could adopt, calculated inevitably to destroy the public credit 
 of this Government, to damn it to alt eternity; yet, so anxious am I to pro- 
 
50B BANK OF THE UNITED STATES. 
 
 vide for the crisis which presses on us, that i would rather fall in even with 
 this alternative, at the expense of all your remaining public credit, in prefer- 
 ence to not voting for some immediate means for meeting present embarrass- 
 ments. If we must ruin our existing creditors in order to procure fresh sup- 
 plies, and if that is the best manner of procuring them, I profess my readiness 
 to proceed to so deplorable a result, rather than to omit altogether, the making 
 01 some provision for the exigency. But the gentleman from South Carolina 
 (Mr. CALHOUN) has pointed out to us a stream of finance which positively is 
 not navigable. We may trace its origin, and follow its course seemingly a 
 line volume of water fertilizing as it flows until we behold it emptying it- 
 self into the ocean: but when \yecome to try its usefulness, we find that, like 
 the river Susquehanna, its navigation is doubtful, dangerous, and unsafe. It 
 invites population to settle on its shores; but diseases and death infest them; 
 and we are amazed to discover, on experiment, how fatally it disappoints the 
 expectations that were at first encouraged of its beneficial properties. Nothing 
 but a freshet will justify our venturing on this current; and that is precarious,, 
 uncertain, and alarming. 
 
 Let us examine this unexpected substitute. What do we find? Why, sir* 
 m the outset an insuperable difficulty, in limim, before we reach the body of 
 the project. The gentleman from South Carolina (Mr. CALHOUN) who, (no- 
 doubt in the zeal of an ardent mind) let drop some rather inadmissible expres- 
 sions, by way of forestalling the objections he anticipated to his scheme, will 
 excuse me for the similitude but really it reminds me of the French veteri- 
 nary surgeon, who killed the sick horse, in order that he might prove his skill 
 by restoring him to life. Is it not so? Does not his plan demand, as its first 
 postulate, a total prostration of the public means, an absolute vacuum in the 
 treasury, to be afterwards revived, by filling it \vith forty millions of treasury 
 notes? Does it not require that the twelve millions which are indispensable 
 for the current quarter of this year, should be sacrificed, and that the Govern- 
 ment should stop payment for the present, relying on this scheme for obtain- 
 ing funds hereafter? Most assuredly, the doors to which you look for loans, 
 will be locked up and double bolted'against your advances, if you enact a law, 
 impregnated as this is now proposed to be, with injustice to those who have 
 hitherto sustained your credit by administering to your occasions. You are 
 to forego the advantages of an approved and rational plan you are to aban- 
 don the attempt to borrow what you stand most seriously in need of at the 
 present, moment; you are to stop payment; you are to become bankrupt, in 
 
 you must, perish under the operation. Of how nice and delicate a texture public 
 credit is composed, yve have had demonstrations but too painful, during the 
 present session. It is the very gossamer of political elements. The perpetual 
 sunshine of confidence, is necessary to its existence. Withhold this, and it 
 languishes. Withdraw it, and it dies. And once dead, where is the magic, 
 xvhere the power that can revive it? Let me caution gentlemen against even 
 handling it too roughly. It is but too easily destroyed; and, whatever may 
 be said in speculations here, depend upon it, sir, that there is no skill in either 
 surgery, or quackery, that can call it back again to an animation once sus- 
 pended. 
 
 Such, however, so imminent, so full of dissolution and decay, arc the very 
 foundations on which this new superstructure is to be built up. Let us now look 
 a little further into its details. And here, at the very inside of the threshold, 
 I am again struck with a general imperfection. Why not come at once to the 
 rejected resolutions of my honest friend from Georgia (Mr. HALL?) What 
 use is there in such a mass of banking machinery, to give circulation to some 
 millions of treasury notes? Why not issue them at once without this unwieldy, 
 this unnecessary medium? Do you surround them with it, in order to pass 
 them off with less embarrassment, supposing that the public will occupy them- 
 selves in examining the mill, without scrutinizing the material? If you do. 
 
PROCEEDINGS OF 1814. 509 
 
 disappointment will be the consequence for those moneyed men, whom you 
 hitherto have looked to for support, though now you seem ready to discard 
 them, are not to be so easily prevailed upon. They are sharp sighted ani- 
 mals, who will pierce through your projects at a glance, however you may 
 wrap and fold them up from common observation. 
 
 Again: If treasury notes are to constitute the universal succedaneum, and 
 you intend to deprive the Government of authority to prohibit the issue of 
 specie even under peculiar circumstances, and for short periods, what occa- 
 sion have you for any specie capital at all? Do you imagine, sir, that . your 
 five or six millions will be suffered to remain quietly in circulation, going in 
 and out of the vaults of this bank, without any guard whatever against its 
 fraudulent evasion? I am quite mistaken if the whole sum would not migraV 
 to Halifax within a fortnight after its deposite. I cannot pretend to speak 
 
 with precision as to the amount of specie, now in retirement, belonging to 
 the different banks of Philadelphia, and individuals who have secured portions 
 of it in safe places: but I should imagine that it must be considerable, perhaps 
 
 some millions. How long, is it supposed, it would continue in fair circulation 
 if the banks were (o pay it out for notes? It would infallibly and almost. 
 instantaneously disappear. 1 confess that I have my doubts as to the propriety 
 Of affording Government any number of the directors of the bank,- but I cannot 
 conceive a mode for dispensing with the inhibition by law of specie issues in 
 certain cases, without referring this authority for its exercise to the. directors 
 themselves, who must endanger the charter by its enforcement. It is, there- 
 fore, best in other hands. 
 
 But, after all, Mr. Chairman, it was in behalf of the public creditors that 
 I was mainly induced to address you. It was to bespeak your indulgence, 
 to appeal to your faith, to indicate your policy, as regards the stockholders of 
 the late loans, that I have ventured to rise on this occasion. In order to under- 
 stand and appreciate their relation to the Government, let us inquire how it 
 came about. It is not two years since, when I first came to this House, I felt 
 it my duty to assert their pretensions against attack from the other side. 
 And now, already, much sooner, I confess, than I expected, I am called upon 
 to defend them from attacks on this side. Blessed encouragement this, to 
 be sure, for those who may be disposed to lend their money to the public! 
 And pray, what are the circumstances that justify these aggressions." You 
 first went into the market fora loan of eleven millions at six per cent, of 
 which you obtained but about six. [Here some explanation took place between 
 Mr. EPPKS (Chairman of the Committee ol"\Ynys and Means) and Mr. INGER- 
 SOLL, by which it appeared that Mr. I. was mistaken in supposing that the 
 residue of this loan had been filled up by a diversion of the sinking fund for 
 that purpose. Mr. E. pointedly denied that the sinking fund ever had been 
 diverted from its true object.] 
 
 The explanation afforded by the gentleman from Virginia (Mr. EPPES) 
 makes no change (proceeded Mr. INGERSOLL) in the aspect of my argu- 
 ment. 1 was about to show that your loan market was exhausted by a loan 
 of six or seven millions, at the hundred for a hundred. Your next bar- 
 gain was for sixteen millions at eighty-eight for the hundred. Afterwards, 
 seven millions and a half at the same rate. And finally, that portion of the 
 twenty-five millions, which has been negotiated at eighty, and perhaps less, 
 for the hundred. And what inducements did you bold forth to those who 
 advanced these sums? Of course the faith of Government for the punctual 
 payment of the interest, and faithful redemption of the principal at the expi- 
 ration of the stipulated term. But was this all? ,Was there no accessory, 
 no additional inducement, besides the plighted faith of the nation? This 
 House must well remember that there was. It cannot be forgotten that the 
 Secretary of the Treasury was selected as one of the commissioners to repair 
 to Europe to treat for peace; and it is perfectly well known that both he and 
 his colleague, at the time that some of these loans were under contract, were 
 sanguine in their calculations on the prosperous result of their mission. Indeed, 
 since we have become acquainted with their instruction?, it. cannot be matter 
 
510 BANK OF THE UNITED STATES. 
 
 of surprise (hat they should have entertained such a confidence. The fact, 
 however, is, that subscribers to the loan at eighty-eight, were led to believe, 
 and from the best authority, that their stock would enjoy all the benefits of 
 peace within twelve months from the time of their subscription, and that in- 
 stead of merely par for the eighty-eight which they loaned, they might reasona- 
 bly calculate on a rise of ten or fifteen per cent, above the hundred which 
 they were promised for their money. It was, moreover, made a test of 
 patriotism in the subscribers, and hundreds contributed in part on this prin- 
 ciple. Gentlemen talk of these persons as if they were the veriest brokers 
 and stockjobbers in the world: and as if, too, none but brokers and stock- 
 jobbers had subscribed. But 'no misconception could be more unfounded. 
 Let such as imagine that some half a dozen usurious capitalists hold all the 
 stock in question, attend on quarter day; at the door of a bank, in which divi- 
 dends are payable, and examine there into the characters and conditions of 
 the crowd of anxious expectants for their income. They will find the widow 
 and the orphan, the aged and the infirm, as well as the wealthy and the com- 
 petent, waiting for their shares; some of them for small sums, payable by 
 way of annuity, (which was authorized by the loan laws) and the only reliance 
 of the poor People who have invested their funds in this stock. These are 
 the persons whom you are proposing to cast aside. They did not seek you 
 nor press themselves into your assistance; but, on the contrary, you went in 
 search of them, and induced them, by strong and seductive promises, to part 
 with their money for your necessities. They did so at your earnest instances. 
 They paid it to you when they could have had gold and silver for their checks. 
 But now having bound them to your destiny, having exhausted their capacity 
 to lend, you deny them (should the proposed amendment be adopted} any 
 participation in your plans for the improvement of their funds. You leave 
 them to their fate, vainly imagining, that after such crying injustice, you can 
 substitute another class of creditors in their places. No moneyed institution 
 can succeed which is to be founded on principles at war with the interests of 
 the moneyed men of a community. You may rail at these persons if you will; 
 but, depend upon it, that to enlist their opposition to any plan for the resto- 
 ration of public credit is not the way to accomplish it. 
 
 The bank contemplated by the original bill on the table, was to be laid on 
 the liberal, the politic, and the natural endowments of public stock and spe- 
 cie, in certain adequate proportions. That which is to be attempted, should 
 the amendment succeed, would, for the first time in the history of such insti- 
 tutions, be founded on a vast basis of new paper or stock to be created, to 
 the prejudice of those who now own the stocks and regulate the prices, in the 
 market. Of these, there are between sixty and eighty millions (including 
 treasury notes) in existence. Instead of withdrawing a third of this amount 
 and appropiating it to a bank, the gentleman from South Carolina (Mr. CAL 
 HOUN) would send in forty odd millions more, in the shape of treasury notes, 
 more heavily than ever to choke up and overdo the market. I do not pretend 
 to be very conversant with these matters, but I must confess, that 1 cannot 
 perceive how such a scheme could possibly succeed in operation. 
 
 Of all models fora moneyed institution, the late Bank of the United States 
 affords one. the most worthy of imitation. And upon what was it founded? 
 Public stock and specie capita!. What public stock? Not new stock created 
 for the purpose; but that which was funded at twenty shillings in the pound, 
 though a great deal of it was purchased as low as one and six pence. The 
 Secretary of the Treasury would hear of no discrimination between the credi- 
 tors. He well knew that public credit was to be created, not by looking for- 
 ward to new auxiliaries, and discarding old ones, but by; a punctilious and 
 faithful, an indiscriminate and universal fulfilment of all former engagements. 
 Paying old debts is the best mode of enabling a community to contract new 
 ones. The Bank of England, the Bank of Genoa, most of the celebrated mo- 
 neyed institutions in Europe , were established on similar recognitions and 
 adoptions of the public stocks of their respective countries. The Bank of the 
 United States, therefore, followed their example. Stockholders, who were 
 
PROCEEDINGS OF 1814. 
 
 known to have purchased their stock at a great discount, were, nevertheless, 
 allowed to subscribe without discrimination, though it was well ascertained 
 that the bank stock would immediately rise after the subscription, and though 
 it did actually rise to one hundred and forty. Now, in all views of this sub- 
 ject, the late Bank of the United States affords a precedent to be consulted 
 with the utmost consideration, and one not to be departed from without very 
 sufficient causes. Broken up as that institution has been, and subjected to 
 the severest tests of investigation, the wisdom, fidelity, and punctuality of its 
 transactions have been manifested in the strongest light; and I think it would 
 be hazarding not a little to disregard them. 
 
 The gentlemen from South Carolina, both the honorable mover of this amend- 
 ment, CM r. CALHOUN) and his colleague who supports him, (Mr. LOWNDES) 
 deny that the creation of a new stock for the ban* capital would be either an 
 injury or an injustice to the present stockholders- I understand that the 
 stock was at 81 the day before yesterday, in Baltimore, and looking up, in an- 
 ticipation of its incorporation into the bank. No doubt it will fall again as 
 soonasthis proposition for excluding itgoesabroad. AV hat more infallible ther- 
 mometer can we have of the effect of such a measure on the stock? There are 
 between sixty and eighty millions of it in circulation. You propose to issue 
 fifteen millions of treasury notes for purchasing up such of it as is to be sub- 
 scribed to the bank. The inevitable consequence must be, first, a competi 
 tion, a most unfair one, in the market, and then a depreciation of the stock. 
 He who subscribed at 80 has 20 per cent, advantage over the more meritori- 
 ous subscriber at 100 or at 88; and no alternative is left for the latter but to 
 sacrifice his stock at 50 or 60, in order to reimburse himself by the profits of 
 a subscription to the bank, or to hold his stock, depreciated to one half of 
 what he gave for it. I am not disposed to repeat the epithets that were be- 
 stowed on such dealings by my friend and colleague (Mr. IXGHAM,) but real- 
 ly, I must say, that I should consider them most reprehensible proceedings. 
 There is, too, a difference ot from fifteen to twenty per cent, in the prices o 
 stock at different places; at Baltimore and Boston, for instance; and the scan- 
 dalous speculations to be authorized, would, therefore, carry with them this 
 additional aggravation. In fact, there is no stock market in this country; and 
 whenever the purchases in question are to be made, the holders of stock in 
 different places must abide the effects of the variation in the prices accumu- 
 lated on the other hardships of their case. 
 
 But why, we arc- asked, arc these stockholders to be preferred? Why is 
 an individual, holding certificates of this stock, to enjoy the advantages of a 
 subscription to the Bank of the United states, in preference to any individual 
 who does not happen to hold such certificates? The answer is, that they are 
 not preferred anv more than the few possessors of specie. Any person may 
 buy the stock who chooses it, and thus become capacitated to subscribe it to 
 the bank. There is no deficiency of it for sale in the market. We have taken 
 care of that; and but two numerous, unfortunately, are they who are anxious 
 to get rid of it. 
 
 As to taking it at the rate at which Government received their money, 
 could any thing be more unjust? The public faith was plighted to redeem 
 eighty -eight with a hundred. The stockholders are, consequently, entitled, in 
 the first place, to have one hundred for their eighty-eight; and then, most as- 
 suredly, they have aright, in common with all other subscribers, to all the 
 profits to accrue, above par, on their subscription to the bank. In this, they 
 are not preferred to other subscribers; though, perhaps, it might be shown, 
 without any great difficulty, that they are entitled to at least a highly favora- 
 ble attention from the Government. We have got all their money. We took 
 it when it was convertible into gold and silver. And it would be neither 
 generous nor just now to postpone them to other members of the commu- 
 nity. 
 
 These arguments, however, are controverted by the gentlemen from South 
 Carolina, both of whom deny that Government is bound to admit these stock- 
 holders into the bank, as well as that any injury will be done to them by the 
 exclusion. But what facts have they advanced to sustain their theory? The 
 
512 BANK OF THE UNITED STATES. 
 
 rise and fall of the stock is, as I have shown, a very clear criterion of the state 
 of the stockholders' interests; arid, really, I cannot help saying, that when 
 so much experience and fact is to be overthrown by a speculation, we should 
 have something more than even the most respectable opinions in its favor. 
 One of those gentlemen (Mr. CALHOUN) insists that no depreciation can be 
 the consequence of his scheme, and the other (Mr. LOWNDES) expresses his 
 conviction that the proposed amendment is preferable to the original bill. 
 Those honorable gentlemen know, I am well persuaded, of the attention and 
 pleasure with which 1 always listen to whatever falls from either of them. 
 But I must be pardoned for withholding my consent to this conclusion of theirs, 
 which really is only asserted, not proved, by the one, with, if! may so ex- 
 press it, his most respectable colleague's endorsement on the draft. 
 
 I was surprised, I confess, at the latter gentleman's (Mr. LOWNDES) repe- 
 tition of a question which had been previously put by the gentleman from 
 North Carolina (Mr. GASTON). Why, it is with seeming triumph demanded, 
 why, if former and not new stock is to be part of the capital, do you exclude 
 the old funded debt of the United States? Most obviously, it may be an- 
 swered, because that account has long ago been settled, because a sink- 
 ing fund has been many years operating the absorption of that debt, be- 
 cause it is not liable to the fluctuation of the market, as the late stock 
 is, and because the holders of it do not desire you to meddle with it. 
 [Mr. LOWNDES here inquired if Mr. INGERSOLL included the Louisiana stock, 
 to which he answered that he did not.] The difference is very great indeed 
 between the old six per cents, of which I am speaking, and the recent stock, 
 created during the present war. After the experience public creditors have 
 lately had of congressional kindness and good will, they might well exclaim, 
 like the French merchants to the economists, "Laissez nous fare. Let us 
 alone. We do riot stand in need of your assistance, nor desire your interpo- 
 sition. All that we ask is, to be let alone. " Very different, indeed, is the 
 situation of the new stockholders, with all their money gone, their funds de- 
 preciated, and their Representatives in Congress inveighing against their con- 
 tracts as usurious and iniquitous. They are bound to the public car by ties 
 they cannot break. They must continue to follow public fate. They cannot 
 afford either to sell or to hold. After exhausting their credit at bank they are 
 driven to the usurer for relief, who strips them of half their stock for the pre- 
 servation of the residue; and that residue they must needs hold to bequeath 
 it to their children, with curses on the Government which borrowed of them, 
 on fair promises, to their last cent, and then left them to their ruin. 
 
 Mr. Chairman, we are debating this interesting subject under very peculiar 
 circumstances. It is now two months since Congress have been in session, 
 convened by the President, under the pressure of great and weighty consider- 
 ations. Since we assembled, a most alarming temperhas appeared in very de- 
 cided indications among some of the Eastern States: and it is said to be in- 
 tended by the agitation of the Hartford convention, to proceed, deliberately, 
 to the disintegration of New England from the Union. For my part, I can- 
 not believe it. I cannot impute such designs to a people whose forecast, or or- 
 derly and general attachment to regular government, have been so much 
 vaunted, and perhaps not without reason. But what encouragement, if such 
 be their object, are we not holding out to them ! And what a rebuke the Hart- 
 ford convention may, in all probability, impose upon Congress? The fifteenth 
 of December is advertised as the day of their meeting, scarcely more than 
 three weeks from the moment when I address you after having been two 
 months in session under every impulse to action and concert without having 
 yet achieved anyone important act without, in fact, being now as likely to 
 agree as we were six weeks ago still amusing ourselves with discordant pro- 
 jects and visionary speculations. The Hartford convention will find disu- 
 nion ready made to their occasions. Instead of taking steps to separate them 
 selves from the other States, to delay or defeat our measures, they will 
 have, I fear, but too much opportunity tbrjdeclaririg that their convention wsa 
 rendered indispensable by our procrastination and idle controversy that they 
 met to save, not to destroy not to deny the authority of Congress and prevent 
 
PROCEEDINGS OF 1814. 513 
 
 its .proceedings 5 but to provide for our omissions; to raise an army to repel in- 
 vasion; to create a navy; to establish adequate taxes and a circulating me- 
 dium to uphold the staggering credit of the country. We are disputing 
 about details while the nation is agonized with the pangs of dissolution. We 
 must come to action, and that speedily too, or the agony will be over. I hope, 
 therefore, Mr. Chairman, that the amendment will be rejected, and that 
 \ve shall endeavor to make some harmonious progress with the original bill 
 on the table. 
 
 Mr. OAKLEY, of New York, in a speech of an hour and a half, replied 
 to the speeches of Messrs. INOHAM and INGERSOLL, and advocated the mo- 
 tion of Mr. CALHOUN. He began by deprecating a hasty decision on this 
 subject, one of the most important that could ever come before a legislative 
 body; being no less than the establishment of a charter for a moneyed 
 institution of fifty millions, the features of which could not, when once set- 
 tled by a solemn act of Congress, be changed, but must be as irrevocable, dur- 
 ing the term of the charter, as the constitution itself, &c. The National Bank, 
 if necessary. \vas required by the public good alone. He therefore threw out of 
 view, as wholly irrelative, the argument m relation to the effect of the propos 
 ed amendment on the holders of public stock, who had no right to demand any 
 advantages from such an institution, and to whom no injustice would be done 
 by precluding them from any other share in it than other citizens of the United 
 States. He stated some things in relation to tiiis bill, to show that the facts 
 of its having been reported by the Committee of Ways and Means was not an 
 unanswerable argument against amendment: for, he stated, that the principal 
 
 nrst tne details ol me Dill uetore the House, and next or me amendment pro- 
 posed to be made to it; and concluded an elaborate and able view of the sub- 
 ject, by expressing his decided conviction of the superior practicability of Mr. 
 CALHOUN'S proposition over the bill as reported, &c. 
 
 When Mr. OAKLEY concluded, 
 
 The question was taken on Mr. CALHOUN'S motion to amend the bill, and 
 decided in the affirmative, by a majority of about sixty votes. 
 The committee then rose, reported progress, and obtained leave to sit again. 
 
 NOVEMBER 18, 1814. 
 
 Mr. CALHOUN, of South Carolina, remarked, that he looked upon the deci- 
 sion of the House on yesterday, as indicating a disposition, on the part of the 
 House, to change the whole nature of the bill, now before a committee of the 
 whole, for incorporating the subscribers to the Bank of the United States of 
 America. As many amendments in detail would be required, he thought the 
 most proper way to act on the. bill would be to recommit it for amendment 
 to a select committee. 
 
 This motion was opposed by Mr. WRIGHT, of Maryland, and Mr. LOWNDES, 
 of South Carolina, on the ground that there were parts of the plan of the een- 
 tleman, against which the House might decide, and which could as well be 
 acted on in committee of the whole as by a select committee. 
 
 Mr. CALHOUN then withdrew his motion, reserving the right to offer it 
 again when further progress should have been made in the discussion of the 
 bill. 
 
 On motion of Mr. FISK, of New York, the House then again resolved itself 
 into a committee of the whole on the said bill, Mr. NELSON in the chair. 
 
 Mr. FORSYTH, of Georgia, moved an amendment to the second section of 
 the bill, (as it has been amended) the object of which was, to admit the forty- 
 four millions of the capital to be paid in treasury notes, as it now stands, or 
 in public stock created since the war. 
 65 
 
514 BANK OF THE UNITED STATES. 
 
 This motion was declared by the Chairman to be out of order, inasmuch as 
 the committee of the whole had yesterday decided, that no part of the pay- 
 ments of the subscriptions to the bank, snould be made in the manner pro- 
 posed by the amendment. 
 
 Mr. FORSYTH was, on this decision, disposed, for the present, to waive his 
 motion; but 
 
 An appeal was made by Mr. FISK, from the decision of the chair on this 
 point; which decision was affirmed by the committee of the whole 75 to 39. 
 
 The House then proceeded to the consideration of the third section of the 
 bill, which contemplates the subscription by the United States of twenty 
 millions in six per cent, stock to the capital of the bank. 
 
 This section Mr. CALHOUN moved to strike out of the bill. 
 
 This motion produced debate. 
 
 Mr. FORSYTH, of Georgia, said, he hoped the section would not be struck 
 out. He considered it important that the United States should hold a certain 
 proportion of the stock of the bank, because he believed the privilege of so 
 doing, would be valuable to the Government. In the stock of the old Bank 
 of the United States, the Government had held a considerable portion of the 
 stock, and the benefit to be derived from it had not been denied. It had been 
 a matter of boast on the other side of the House, and the republican admin- 
 istration had enjoyed the advantages arising to the Government from it. He 
 could not conceive any solid objection to this course. It might be said the 
 bank would be injuriously affected by the shares the United States would 
 hold in it, because they would subscribe nothing but stock. But Mr. F. said, 
 if the basis of the bank was to be public stock, its value would not be destroyed 
 by a part of it being owned by the United States as well as by individuals.. 
 He hoped the motion would not prevail. 
 
 Mr. CALHOUN said the principle of his motion had been decided by the 
 amendment which had been made to the second section. Consistency re- 
 quired that the House, after deciding as they did yesterday, should now 
 strike out this section. 
 
 Mr. WRIGHT said he did not consider the decision of yesterday as at all 
 interfering with this motion. If it did, he felt himself to be committed con- 
 trary to his intention. The discussion on yesterday had not turned on thia 
 point j and, he contended, even had the House inadvertently decided the 
 principle yesterday, the decision to retain this section would control the 
 provision in the said second section, inasmuch as, in law, posterior control 
 prior provisions. The Government ought, he contended, to have a share in 
 the stock, and in the direction of the bank. The old Bank of the United 
 States would yet have been in operation, he said, if a portion of the direction 
 had been under the control of the Government, to have prevented it from 
 being a perfect inquisition. He instanced the advantages which several of 
 the States derive from holding a share in the stock and direction of banks 
 within their respective limits. Seven-eighths of the capital of the old bank 
 had, he said, been held by foreigners: and every man who had any hand in 
 tlie direction of its concerns was adverse to the politics of this administration. 
 Some of them were refugees from the country, who ought to have been hung 
 during the Revolution. It could not, therefore, be expected that Congress 
 would revive that institution or create any other, the whole weight of which 
 would have been thrown in the opposite scale to that of the United States. 
 Mr. W. was desirous not only that the United States, but that the agricul- 
 tural interest of the country, should hold a due proportion in the stock of this 
 bank, to keep it out of the exclusive control of the commercial class, which, 
 he intimated, was generally in the British interest, and not a few actually 
 connected in business with Britisli houses. The landed and manufacturing 
 interest, he argued, ought to be at least equally interested in the bank with 
 the commercial. It was" necessary the Government should hold both stock 
 
PROCEEDINGS OF 1814. 
 
 and direction in the bank, to guard the United States against the operation of 
 any foreign influence, &c. 
 
 Mr. CALHOUN finding, as he said, from the course of the debate, that the 
 eyes of the committee had been so entirely directed to the main object of the 
 amendment adopted yesterday, that they had overlooked the part of it to which 
 this section had reference, rose to explain the reasons of his present motion. 
 Whether the provision under consideration should be struck out or retained, 
 he contended, depended on the situation of the nation. He was clearly of 
 opinion, that, in the present situation of the nation, it ought to be struck out. 
 One great object of this bank was to afford the means of relieving the nation 
 from difficulties under which it now labored. By striking out this section, 
 the Government would not, he said, lose the advantages it would derive from 
 retaining it, inasmuch as the twenty millions, instead of being vested by the 
 United States in stock, would assume the shape of treasury notes, and in 
 reality produce the effect, by their absorption in the bank, of an immediate 
 loan to the Government. Which, he asked, does the United States now 
 most want a capital, or the use of a capital? He said he should be glad, 
 indeed, abstractedly, that the United States should possess a share in the 
 capital of the bank; he should be glad the United States should possess a 
 capital in the bank on which they could draw one, two, or three per cent, 
 more interest than they had to pay for it. But we want still more the use of 
 the capital. If any gentleman could conceive the situation of the country to 
 be such that we could lock up instead of using these twenty millions of 
 capital, he would vote against this amendment. The capital, he said, would 
 not be lost to the United States, but would assume for them the most active 
 and most efficient form, by means of the treasury notes, which, being put 
 into circulation and absorbed by the Government, would effect an immediate 
 loan to the Government. But, it had been said, unless the United States 
 held some share in the bank, it would fall into the hands of our enemies. 
 Mr. C. said he did not think so harshly as the gentleman from Maryland of 
 the commercial interest; in the large, he believed that great interest to be 
 American, notwithstanding some exceptions might be found to that character. 
 But even if such a disposition as was feared by the gentleman should exist, 
 it would not be controlled by retaining the present provisions of the bill; 
 because the twenty directors could always vote down the five proposed to be 
 appointed by the Executive, if there should arise a contest between the 
 Government and the bank. But there was another mean of protecting the 
 Government against the bank, more potent and certain than any such provi- 
 sions: let the United States retain the power over its deposites, and over the 
 receipt of the bank notes in payment or duties and debts to the Government, 
 and it would possess a sufficient control over the bank. 
 
 Mr. FORSYTH admitted an immediate loan would be an advantage to the 
 Government; but was such a loan wanted, to the proposed amount, in addition 
 to the taxes to be raised by the bills now before the House? He contended 
 that it probably would not. But, if it would, he argued that part of the project 
 was impracticable, because of the difficulty of throwing into market forty -four 
 millions of dollars of treasury notes; whereas, if twenty millions of that 
 amount were subscribed in stock in behalf of the United States, the balance of 
 twenty-four millions would be all disposed of, and would probably be suffi- 
 cient tor all the purposes of the Government. Even for the benefit of the 
 gentleman's plan, therefore, this feature ought to be retained. 
 
 Mr. CALHOUN said, that if fifteen millions of the forty-four millions of 
 treasury notes were applied, as he had suggested, to the purchase of stock, 
 and five millions to the redemption of treasury notes falling due at the com- 
 mencement of the next year, there would be no difficulty in disposing of the 
 remainder of them. He said, to vest twenty millions in the capital stock of 
 the bank would be acting like a man, without d dollar in his pocket, offering 
 
516 BANK OF THE UNITED STATES. 
 
 to lend out money at an interest lower than he lias to pay for it for hi& use* 
 If the demands of the treasury during the next year did not require the whole 
 of these notes, Mr. C. said a part could be retained until the year after, and 
 thus provision be made for two years. If the subscriptions were received 
 monthly in twelve instalments, there would never be out at one time more 
 than two millions; much less than the amount of treasury notes now in cir- 
 culation-. There would be no doubt, he thought, of their being sought for with 
 avidity. 
 
 Mr. INGHAM, of Pennsylvania, said that,, if the whole amount of treasury 
 notes now proposed to be issued, should not be wanted in the course of the 
 next year, it would unquestionably be more to the interest of the Government 
 to invest twenty millions of the amount in stock in the bank, provided it would 
 be an advantage to them to possess that stock. Allowing the stock of the 
 bank to advance as it might be expected to do, it would afford a profit to the 
 United States, in twelve months, of six millions of dollars; and the United 
 States would besides dispose of the capital stock at its full value whenever 
 they chose. 
 
 Mr. FORSYTH still questioned the ability to circulate so large an amount of 
 treasury notes; because they were not like bank paper, which could at any time 
 command specie; nor would they circulate even as well as the present treasury 
 notes, because not payable at the end of the year, but to be funded in six per 
 cent, stock. The fact that money is not to be paid for the proposed issue of 
 treasury notes, would be as well known to the People of the United States as 
 this House. The circulation of treasury notes at present was principally 
 among those who have money on hand tor which they have not immediate 
 use, which they invest in treasury notes, in preference to this public stock; 
 because, at the same time that they produce an interest, they are payable at 
 a day certain. The treasury notes to be issued will not suit such persons,, 
 and will, therefore, probably have a very limited circulation, 
 
 Mr. KILBOURN said he had voted for the amendment yesterday, without 
 any idea that the other amendments indicated by its mover, would necessarily 
 follow. He hoped the section now under consideration would not be struck 
 out. For, though he had ever believed the establishment of a national bank 
 one of the most important objects, yet, if this motion prevailed, he should 
 greatly deprecate it. Was it true, he asked, that this nation was so embar- 
 rassed in its finances, was in such a critical situation, that y to obtain money 
 for a year, it was necessary to establish a colossal moneyed institution, with 
 a charter which it would be beyond the power of this Governmunt to alter 
 for twenty years; that might, in one year, if amended as proposed, fall entirely 
 under the direction of the enemies of the Government? He trusted not, lt' r 
 on the other hand, this stock was taken by the Government in the bank, it 
 might be sold at any moment, if necessary, at twenty per cent, profit, or at 
 least without a sacrifice; and thus furnish the United States with as much 
 money as it would sell for. 
 
 Mr. LOWNDES supported the motion to strike out this section. The reser- 
 vation of twenty millions for the United States of the capital of the bank* 
 would, he said, unquestionably be attended with some advantages. It could 
 not be denied that it would, by the strength of this capital, or by selling it at an 
 advance, afford the means of obtaining money for the service of the Govern- 
 ment in the year 1816. But the course proposed by gentlemen was to lessen 
 the security of the loan for 1815, in order, with remarkable foresight, to pro- 
 vide the ways and means for the year 1816. Mr. L. said he differed from his- 
 colleague as to the application of fifteen millions of treasury notes to purchase 
 of public debt, and five millions for the redemption of treasury notes. The ob- 
 ject of Mr. L. was nothing more than this: to induce the House to reduce the 
 capital of the bank from its present proposed amount. It almost necessarily 
 followed, from the main points of his colleague's plan, that the capital should 
 
PROCEEDINGS OF 1814. 
 
 be reduced. It was impossible every treasury note thrown out should be 
 absorbed in the bank at me times of subscription; and the amount to be issued 
 must, therefore, of necessity, exceed the amount to be paid in as a part of the 
 capital stock of the bank. It was important, in giving additional value to the 
 treasury notes, that the bank stock should be made as valuable as it could. 
 The success of the plan for immediately aiding Government by the means 
 proposed, must depend on the value of the treasury notes, which must depend 
 on the value of the shares in the bank. The less valuable the shares in the 
 bank, as they would be by the retention of so large a capital stock, the less 
 temptation would there be to purchase the notes or stock which is the basis 
 of the subscription. Mr. L. said he hoped, before this subject was finally 
 acted on, the committee would limit to thirty or thirty-five millions, to some 
 moderate, some reasonable amount, the circulation of the bank, and thus 
 guard against danger of the plan from the amount of capital, at the same time 
 that it would increase the value of the treasury notes. The plan of the gen- 
 tleman before him (Mr. Forsyth) he thought it obvious, provided for the 
 demands of the public service in 1816, by rendering utterly hazardous, if not 
 entirely defeating, the provision for 1815. He denied that the treasury notes 
 to be issued in pursuance of this plan would be less valuable than those now 
 in circulation. It was impossible, he said, in the nature of things, but, in 
 furnishing additional modes of application of them, the committee would 
 increase instead of diminishing the value of treasury notes, &c. c. 
 
 After a few words from Mr. RHEA, of Tennessee, indicative of an impa- 
 tience for the question 
 
 The committee agreed to Mr. CALHOUN'S motion by the following vote: 
 For the motion, 79, 
 
 Against it, - 53. 
 
 So the third section was struck out. 
 
 Th ; committee then proceeded in further examination and amendment to 
 the details of the bill, in the course of which considerable debate took place, 
 involving generally the minor principles of the art or science of banking. 
 Among the amendments agreed to, were the following: viz. To strike out 
 so much as gives the Government a share in the direction of the bank; so 
 much as prohibits the bank from selling the United States' stock which may 
 come into its possession; so much as binds the bank to loan thirty millions to 
 the Government, &c. 
 
 A motion was made by Mr. LEWIS, of Virginia, and supported by Mr. 
 PEARSON, to amend that part of the section authorizing the bank to establish 
 offices of discount, deposite, and distribution, so as to require the bank, when- 
 ever the Government may direct it ? to establish an office of discount and de- 
 posite at the city of AVashington, with a capital (not less than five millions of 
 dollars.) After striking out the latter clause, within parenthesis, the motion 
 was negatived. 
 
 When the committee rose for to-day, an amendment was under discussion 
 affecting the manner in which the bank shall pay specie for its notes, whether 
 at all its offices, or at the mother bank only. 
 
 NOVEMBER 19, 1814. 
 
 The House again in committee of the whole, Mr. NELSON in the chair. 
 
 The question depending on yesterday's adjournment was on a motion of 
 Mr. OAKLEY, of New York, to strike out the 18th fundamental rule for the 
 government of the bank, which is in the following words: 
 
 " 18. During- the continuance of the present war between the United States and 
 Great Britain, all the notes of the said corporation, whether payable at the seat of the 
 bank in Philadelphia, or elsewhere, shall be payable in other notes of the said corpora- 
 tion, in treasury notes, or in gold and silver coin, at the bank in the city of Philadelphia, 
 
518 BANK OF THE UNITED STATES. 
 
 at the option of the applicant. At all the offices of discount, deposite, and distribu- 
 tion, and of deposite and distribution only, established, as aforesaid, and at all the banks 
 employed in lieu of such offices, as aforesaid, the notes of the said corporation, during 
 the continuance of the said war, shall be payable in other notes of the said corporation, 
 or in treasury notes only." And the said corporation shall, at all times, distribute 
 among the offices and banks aforesaid, a sufficient sum in the various denominations of 
 the notes of the said corporation, and in treasury notes, to answer the demand there- 
 for, and to establish a sufficient circulating medium throughout the United States and 
 the territories thereof. 
 
 On the suggestion of Mr. LOWNDES, Mr. OAKLEY modified his motion so 
 as to strike out that part only; of the rule which is in inverted commas; and, 
 after some remarks, in opposition, from Mr. FISK, the motion was agreed to. 
 
 Ayes 82. 
 
 Mr. LOWNDES then moved to amend the remainder of this rule, by adding, 
 after the words "treasury notes," the words "which it may receive upon de- 
 posite of the Government." Agreed to. 
 
 The 19th rule having been read, in the following words: 
 19. "The officer at the head of the Treasury Department of the United States shall 
 be furnished, from time to time, as often as he may require, not exceeding once a 
 week, with statements of the amount of the capital stock of the said corporation, and 
 of the debts due to the same; of the moneys deposited therein; of the notes in circu- 
 lation, and of the cash in hand; and shall have a right to inspect such general accounts 
 in the books of the bank as shall relate to the said statement: Provided, That this 
 shall not be construed to imply a right of inspecting the account of any private indivi- 
 dual or individuals with the bank." 
 
 Mr. FORSYTH moved to strike out this rule. If the Government had no 
 interest in, or control over the institution, he saw no reason or propriety in 
 the United States having a right to inspect the proceedings or state of the 
 bank. 
 
 To this Mr. CALHOUN replied, that there was an obvious propriety in the 
 United States haying the right to inspect the affairs of the bank, to ascertain 
 whether its deposites, &c. would be safe in its hands. 
 
 The motion to strike out the rule was negatived. 
 
 The 10th section, making the notes of the bank receivable in all payments 
 to the United States, having been read 
 
 Mr. CALHOUN, of South Carolina, moved to strike it from the bill; assign- 
 ing, as a reason for this motion, that, as the United States were now, by the 
 amendments which had taken place, divested of all control over the opera- 
 tions of the bank, it would be proper, in self-defence, for the Government to 
 retain in its hands the. power to make the notes of the bank receivable or not, 
 to protect it against misconduct or attempt at control by the bank. 
 
 The motion was agreed to without a division. 
 
 On motion of Mr. CALHOUN, the section authorizing the suspension, on 
 proclamation of the President, of specie payment in certain cases and for cer- 
 tain periods, was stricken out without debate or division. 
 
 The 13th section of the bill, which pledges the faith of Congress not to esta- 
 blish any other bank during the continuance of the charter, being read, 
 
 Mr. LEWIS, of Virginia, moved an amendment, the object of which was, to 
 except from this prohibition the banking associations existing within the Dis- 
 trict of Columbia, not at present incorporated. 
 
 Agreed to. 
 
 The bill having been gone through, 
 
 The committee recurred, on suggestion of Mr. LOWNDES, to the first sec- 
 tion of the bill. 
 
 Mr. LOWNDES made a motion, which he supported by a train of reasoning, 
 predicated on the impracticability and unwieldinessof so large a moneyed in- 
 
PROCEEDINGS OF 1814. 
 
 stitution as this bank was proposed to be, to reduce the capital of the bank 
 fromjtfiy to thirty-Jive millions of dollars. 
 
 Mr. CALHOUN opposed the motion with much zeal, defending the proposed 
 amount of capital on the ground of the proposed appropriation of fifteen mil- 
 lions of the treasury notes for the purchase of existing stock, &c. 
 
 Mr. CUTHBERT and Mr. FORSYTH supported Mr. LOWNDES'S motion, and 
 Mr. CALHOUN replied to them. 
 
 The motion was, in the end, negatived, as follows: 
 
 For the motion, - - 56, 
 
 Against it, 75. 
 
 On motion of Mr. CALHOUX, an amendment was adopted to the first section 
 of the bill, changing the times of subscription to conform it to the intimations 
 he had before given. 
 
 On motion of the delegate from Missouri, the town of St. Louis was inserted 
 as one of those at which subscriptions should be received, and J. B. C. Lucas, 
 Alexander Stuart, and Bernard Pratt, named as commissioners; and, on mo- 
 tion of Mr. Fisk, of Vermont, Windsor, in that State, was also inserted, and 
 Elias Lyman, Wm. Levering, and Eleazer May, named as commissioners. 
 
 Various other amendments were proposed to the bill, some of which were 
 adopted and some rejected. 
 
 At length the committee rose and reported the bill as amended. 
 The bin having been so interleaved and interlined with amendments by the 
 committee of the whole, that the Clerk himself could scarcely arrange them, 
 or the Speaker state them to the House. 
 It was ordered to lie on the table, ana be printed as amended. 
 
 [The amended bill to incorporate the subscribers to the Bank of the United States of 
 
 America. ] 
 
 Be it enacted by the Senate and House of Representatives of the United 
 States of America in Congress assembled, That a Bank of the United States 
 of America shall be established, the capital stock of which shall be fifty mil- 
 lions of dollars, and no more, divided into five hundred thousand shares, of 
 one hundred dollars each share, and that subscriptions and payments towards 
 constituting the said capital stock shall be opened and made on the two last 
 days of January next, Sundays excepted, of each succeeding month of the year 
 one thousand eight hundred and fifteen, till the whole amount subscribed and 
 paid shall equal the sum of fifty millions of dollars, aforesaid, the sum sub- 
 scribed to be paid at the time of subscribing, at the following places, viz: at 
 Hallo well, in Maine; Portsmouth, in New Hampshire; Windsor, in Vermont; 
 Boston; New York; New Brunswick, in New Jersey; Philadelphia; Balti- 
 more; City of Washington; Richmond; Raleigh; Charleston; Savannah; Lex- 
 ington, in the State of Kentucky; Nashville, in the State of Tennessee; Chil- 
 licothe, in the State of Ohio; New Orleans and St. Louis, in the Territory 
 of Missouri, under the superintendence of the following persons, as commis- 
 sioners to receive the same: at Hallowell, Benjamin Dearborn, Joshua Gage, 
 and Peter Grant; at Portsmouth, in New Hampshire, John Gpddard, Na- 
 thaniel A. Haven, Nathaniel Gilman; at Windsor, in Vermont, Elias Lyman, 
 William Leverett, and Eleazar May; at Boston, James Lloyd, Thomas Handy- 
 side Perkins, William Gray, William Eustis, and Samuel Brown; at New 
 York, Isaac Lawrence, John Hone, General John Smith, Isaac Bronson, and 
 Theron Rudd; at New Brunswick, James Vanderpool, John Bray, and Peter 
 Gordon; at Philadelphia. Jared Ingersoll, Anthony Taylor, Thomas M. Will- 
 ing, Stephen Girard, Chandler Price; at Baltimore, Henry Pason, William 
 Cooke, William Wilson; at the City of Washington, Robert Brent, Walter 
 Smith, and Thomas Swann; at Richmond, Benjamin Hatcher, John Broken- 
 borough, John Preston; at Raleigh, Sherwood Haywood, Beverly Daniel, and 
 William Peace; at Charleston, John C. Faber, John Potter, James Carson; 
 at Savannah, John Bolton, Charles Harris, and James Johnson; at Lexington; 
 
520 BANK OF THE UNITED STATES. 
 
 in Kentucky, Charles Wilkins, Lewis Sanders, John H. Morton; at Nashville, 
 Tennessee, Robert Weekly, Felix Grundy, and John R. Bedford; at Chilli- 
 cothe, in Ohio, Samuel Finley, Thomas James, William McFarland; at New 
 Orleans, Dominick A. Hall, Benjamin Morgan, Paul Lanuse, Thomas L. 
 Harmar, and William Flood; at St. Louis, in the Territory of Missouri, John 
 B. C. Lucas, Alexander Stuart, and Bernard Pratt; which subscriptions shall 
 continue open every day, from the time of opening the same, from ten o'clock 
 in the forenoon until four o'clock in the afternoon; and immediately after 
 each subscription and payment, the commissioners, or a majority of them, at 
 the respective places aforesaid, shall cause two transcripts, or fair copies of 
 such subscriptions to be made, one of which they shall send to the Secretary 
 of the Treasury, one they shall retain, and the original subscriptions shall, 
 within three days from the closing of the same, be, by the said commissioners, 
 transmitted to the said commissioners at Philadelphia, or to one of them; ana 
 on the receipt thereof, the said commissioners at Philadelphia, or a majority of 
 them, shall immediately thereafter convene, and proceed to take an account of 
 the said subscriptions: and if, on adding the final subscription and payment 
 to the sums previously subscribed and paid, more than the amount of fifty 
 millions of dollars shall have been subscribed and paid, then the said last 
 mentioned commissioners shall apportion the difference between the said ca- 
 pital stock of fifty millions of dollars, and the aggregate amount of the sub- 
 scriptions and payments, preceding the final subscription and payment, among 
 the several subscribers to the final subscription, in a just and equal ratio, ac- 
 cording to their several and respective subscriptions: Provided, however, That 
 such commissioners shall, by such apportionment, allow and apportion to each 
 subscriber at least one share; and the said commissioners, after having appor- 
 tioned the same as aforesaid, shall cause lists of the said apportioned subscrip - 
 tions to be made out, including in each list the apportioned subscription for 
 the place where the original subscription was made, one of which lists shall 
 be transmitted to the commissioners, or to one of the commissioners, under 
 whose superintendence such subscriptions were originally made, that the sub- 
 scribers may ascertain from them the number of shares 'apportioned to such 
 subscribers, respectively: and if the amount of thirty millions of dollars shall 
 not be subscribed, during the period aforesaid, at all the places aforesaid, the 
 subscription to complete the said sum shall afterwards be, and remain open, 
 at Philadelphia, under the superintendence of the said commissioners ap- 
 pointed at that place; and the subscriptions may be there made by any corpo- 
 ration, copartnership, or person, for any number of shares, not exceeding the 
 amount required to complete the said sum of thirty millions of dollars. 
 
 SEC. 2. And be it further enacted, That it shall be lawful for any person, 
 copartnership, or body politic, to subscribe for so many shares of the said capital 
 stock of the said bank, as he, she, or they, shall think fit; and the sums re- 
 spectively subscribed, shall be payable in the manner following, that is to say: 
 six millions of dollars thereof in gold or silver coin of the United States, or in 
 gold coin of Spain, or the dominions of Spain, at the rate of one hundred cents 
 for every twenty-eight grains and sixty-hundredths of a grain of the actual 
 weight thereof : or in other foreign gold or silver coin, at the several rates pre- 
 scribed by the first section of an act regulating the currency of foreign coins 
 in the United ^States, passed tenth day of April, one thousand eight hundred 
 and six; and forty-four millions of dollars thereof in such gold or silver coin 
 as aforesaid, or in treasury notes, now authorized, or to be authorized, to be 
 issued in the year one thousand eight hundred and fifteen. 
 
 SEC. 3. find be it further enacted, That whenever and as often as any of 
 the treasury notes shall be subscribed and paid in as aforesaid, to the said 
 capital stock of the said bank, shall be due and payable, it shall be lawful for 
 the Secretary of the Treasury (and he is hereby authorized and required) to 
 pay and redeem the same, principal and interest, by causing certificates of pub- 
 lic stock, for an equal amount, bearing an interest of six per cent, per annum, 
 and redeemable in any sums, and at any periods, which the Government may 
 deem fit, to be prepared and made in the usual form, and the same to be de- 
 
PROCEEDINGS OF 1814, 
 
 hvered to the president and directors of the said bank, in satisfaction and dis- 
 charge of such treasury notes. 
 
 SEC, 4. And be it further enacted, That the subscribers to the said Bank of 
 the United States of America, their successors and assigns, shall be, and are 
 hereby, created a corporation and body politic, by the name and style of "The 
 President, Directors, and Company of the Bank of the United States of Ameri- 
 ca;" and shall so continue until the third day of March, in the year one thousand 
 eidit hundred and thirty-five: and by that name shall be, and are hereby, made 
 able and capable in law to have, purchase, receive, possess, enjoy, and retain, 
 to them and their successors, lands, rents, tenements, hereditaments, goods, 
 chattels, and effects, of whatsoever kind, nature, and quality, to an amount not 
 exceeding in the whole fifty-five millions of dollars, including the amount of 
 the capital stock aforesaid; and the same to sell, grant, demise, alien, or dis- 
 pose of, to sue and be sued, plead and be irnpleaded, answer and be answered, 
 defend and be defended, in all courts and places whatsoever: and also to niake, 
 have, and use, a common seal, and the same to break, alter, and renew, at 
 their pleasure; and also to ordain, establish, and put in execution, such by-laws 
 and ordinances, and regulations, as they shall deem necessary and convenient 
 for the government of the said corporation, not being contrary to the constitu- 
 tion and laws of the United States; and generally to do and execute all and 
 8ingular the acts, matters, and things, which to them it shall or may appertain 
 to do; subject, nevertheless, to the rules, regulations, restrictions, limitations, 
 and provisions, hereinafter prescribed and declared. 
 
 SEC. 5. Jlnd be it further enacted, That, lor the management of the affairs 
 of the said corporation, there shall be twenty-five directors, who shall be 
 elected on the first Monday of January, in each year, by the stockholders or 
 proprietors of the capital stock of the said corporation, and by a plurality of 
 votes actually given, according to the scale of voting hereinafter prescribed: 
 and the directors so duly chosen, shall be capable of serving by virtue of such 
 choice, until the end or expiration of the first Monday in January, next en- 
 suing the time of such election, and no longer: Provided* always, That the 
 first election of directors shall be at the time, and for the period', hereinafter 
 declared. 
 
 SEC. 6. And be it further enacted, That, as soon as the sum of thirteen mil- 
 lions two hundred thousand dollars, in such gold and silver coin as aforesaid, 
 and in such treasury notes as aforesaid, shall have been actually received on 
 account of the subscriptions to the said capital stock, notice thereof shall be 
 given by the persons under whose superintendence the subscriptions shall have 
 been made, at Philadelphia, in at least txvo public newspapers, printed in each 
 of the places where subscriptions shall have been made; and the said persons 
 shall, at the same time, and in like manner, notify a time and place within 
 the said city of Philadelphia, at the distance of at least twenty days from the 
 time of such notification, for proceeding to the election of directors aforesaid; 
 and it shall be lawful for such election to be then and there made. And the 
 persons who shall be then and there chosen, as aforesaid, shall be the first di- 
 rectors, and shall proceed to elect one of their number president of the said 
 corporation, and they shall be capable of serving by virtue of such choice until 
 the expiration of the last Monday in January, next ensuing the time of mak- 
 ing the same, and shall, forthwith, thereafter, commence the operations of the 
 said bank, at the said city of Philadelphia: Provided always, That, in case it 
 should at any time happen that an election of directors and president of the 
 said corporation should not be made upon any day, when, in pursuance of 
 this act, they ought to be made, the said corporation shall not for that cause 
 be deemed to be dissolved; but it shall be lawful on any other day to hold and 
 make an election of directors and president of the said corporation (as the case 
 may be) in such manner as shall have been regulated by the by-laws arid or- 
 dinances of the said corporation, and until such election be so made, the di- 
 rectors and president, for the time being, shall continue in office: And pro- 
 vided, also, That, in case of the death, resignation, or absence from the United 
 States, or removal of a director from office, the vacancy shall be supplied by 
 66 
 
522 BAN * OF THE UNITED STATES. 
 
 the stockholders for the remainder of the yean And provided, also, That, in 
 case of the death, resignation, or removal, of the president of the said corpora- 
 tion, the directors shall proceed to elect another president. 
 
 SEC. 7. Jlnd be it further enacted, That the directors, for the time being, 
 shall have power to appoint such officers, clerks, and servants, under them f 
 as shall be necessary lor executing the business of the said corporation, and 
 to allow them such compensation for their services, respectively, as shall be 
 reasonable; and shall be capable of exercising such other powers and authori- 
 ties for the well governing and ordering of the affairs of the said corporation , 
 as shall be described, fixed, and determined, by the laws, regulations,, and 
 ordinances, of the same. 
 
 SEC. 8. Jlnd be it further enacted, That the following rules, restrictions, 
 limitations, and provisions, shall form and be fundamental articles of the 
 constitution of the said corporation, to wit: 
 
 1. The number of votes to which the stockholders shall be entitled, in vot- 
 ing for directors, shall be according to the n amber of shares he, she r or they, 
 respectively, shall hold, in the proportions following, that is to say: for one 
 share and not more than two shares, one vote; for every two shares above two 
 and not exceeding ten r one vote} for every four shares above ten and not ex- 
 ceeding thirty r one vote; for every six shares above thirty and not exceeding 
 sixty, one vote; for every eight shares above sixty and not exceeding one hun- 
 dred, one vote; and for every ten shares above one hundred, one vote. But 
 no person, copartnership, or body politic, shall be entitled to a greater number 
 than thirty votes. And after the first election, no share or shares shall con- 
 fer a right of voting, which shall not have been holden three calendar month* 
 previous to the day of election.. And stockholders, actually resident within 
 the United States,, and none other, may vote in elections by proxy. 
 
 2. Not more than eighteen of the directors in office at the time of an annual 
 election 9 shall be re-elected for the next succeeding year, and no person shall 
 be a director more than three out of four years; but the director who shall be 
 the president at the time of an election, may always be re-elected. 
 
 3. None but a citizen of the United States, and being a stockholder, shall 
 be a director; and if any director shall cease to be a stockholder, he shall 
 cease to- be a director. 
 
 4. No director shall be entitled to any emolument, unless the same shall 
 have been allowed by the stockholders at a general meeting. The stock- 
 holders shall make such compensation to the president, for his extraordinary 
 attendance at the bank, as shall appear to them reasonable. 
 
 5. Not less than seven directors shall constitute a board for the transaction- 
 of business, of whom the president shall always be one, except in case ot 
 sickness or necessary absence, in which case his place may be supplied by any 
 other director, whom he, by writing, under his hand, shall depute for the pur- 
 pose. And the director so deputed, may do and transact all the necessary 
 Business belonging to the office of the president of the said corporation during 
 the continuance of the sickness or necessary absence of the president. 
 
 6. A number of stockholders, not less than sixty, who, together, shall be pro- 
 prietors of one thousand shares or upwards, shall have power at any time to 
 call a general meeting of the stockholders, for purposes relative to the insti- 
 tution, giving at least ten weeks' notice in two public newspapers at the place 
 where the bank is seated, and specifying in such notice the object or objects 
 of such meeting. 
 
 7. Every cashier, or treasurer, before he enters upon the duties of his office, 
 shall be required to give bond, with two or more sureties, to the satisfaction 
 of the directors, in a sum not less than fifty thousand dollars, with a condition 
 for his good behavior, and the faithful performance of his duties to. the corpor- 
 ation. 
 
 8. The lands, tenements, and hereditaments, which it shall be lawful for 
 the said corporation to hold, shall be only such as shall be requisite for its im- 
 mediate accommodation in relation to the convenient transacting of its busi- 
 ness, and such as shall have been bona fide mortgaged to it by way of security, 
 
PROCEEDINGS OF 1814. 523 
 
 or conveyed to it in Satisfaction of debts previously contracted in the course 
 of its dealings, or purchased at sales, upon judgments which shall have been 
 obtained for such debts. 
 
 9. The total amount of the debts which the said corporation shall, at any 
 time, owe, whether by bond, bill, note, or other contract, shall not exceed 
 the sum of fifty millions of dollars, over and above the moneys then actually 
 deposited in the bank for safe keeping, unless the contracting of any greater 
 debt shall have been previously authorized by a law of the United States. In 
 case of excess, the directors, under whose administration .it shall happen, shall 
 be liable for the same in their natural and private capacities; and an action of 
 debt may, in such case, be brought against them, or any of them, their, or any of 
 their heirs, executors, or administrators, in any court of record of the United 
 States, or either of them, by any creditor or creditors of the said corporation, 
 and may be prosecuted to judgment and execution, any condition, covenant, or 
 agreement, to the contrary notwithstanding. But this provision shall not be 
 construed to exempt the said corporation, or the lands, tenements, goods, or 
 chattels, of the same, from being also liable for, and chargeable with, the said 
 excess. Such of the said directors who may have been absent when the said 
 excess was contracted or created, or who may have dissented from the reso- 
 lution or act whereby the same was so contracted or created, may respective- 
 ly exonerate themselves from being so liable, by forthwith giving notice of the 
 met, and of their absence or dissent, to the President of the United States, 
 and to the stockholders, at a general meeting, which they shall have power to 
 call for that purpose. 
 
 10. The said corporation shall not, directly or indirectly, deal or trade in 
 any thing except bills of exchange, gold or silver bullion, or in the sale of 
 goods really and truly pledged for money lent and not retleemed in due time, 
 or goods which shall be the produce of its lands. It shall not be at liberty to 
 purchase any public debt whatsoever; nor shall it take more than at the rate 
 of six per centum per annum for, or upon, its loans or discounts; but the said 
 corporation may sell any part of the public debt whereof its stock shall be 
 composed. 
 
 11. No loan shall be made lay the said corporation for the use, or on account 
 of the Government of the United States, to an amount exceeding three hun- 
 dred thousand dollars, or of any particular State, to an amount exceeding fifty 
 thousand dollars, or of any foreign Prince or State, unless previously autho- 
 rized by a law of the United States, 
 
 12. The stock of the said corporation shall be assignable and transferable 
 according to such rules as shall be instituted in that behalf, by the laws and 
 ordinances of the same. 
 
 13. The bills obligatory and of credit, under the seal of the said corporation, 
 which shall be made to any person or persons, shall be assignable by endorse- 
 ment thereupon, under the hand or hands of such person or persons, and his, 
 her, or their executors or administrators, and of his. her, or their assignee or 
 assignees, and the executors or administrators of such assignee or assignees, 
 and so as absolutely to transfer and vest the property thereof in each and 
 every assignee or assignees successively, and to enable such assignee or as- 
 signees, and his, her, or their executors or administrators, to maintain an 
 action thereupon in his, her, or their own name or names. And the bills or 
 notes which may be issued by order of the said corporation, signed by the pre- 
 sident, and countersigned by the principal cashier or treasurer thereof, pro- 
 mising the payment of money to any person or persons, his, her, or their order, 
 or to bearer, although not under the seal of the said corporation, shall be 
 binding and obligatory upon the same, in the like manner, and with the like 
 force and effect, as upon any private person or persons, if issued by him or 
 them, in his, her, or their private or natural capacity or capacities, and shall 
 be assignable and negotiable in like manner as if they were so issued by such 
 private person or persons; that is to say: those which shall be payable to any 
 person or persons, his, her, or their order, shall be assignable by endorsement, 
 in like manner, and with the like eft'ect, as foreign bills of exchange now are; 
 
524 BANK OF THE UNITED STATES. 
 
 and those which are payable to bearer, shall be assignable and negotiable by 
 delivery only. 
 
 14. Half yearly dividends shall be made of so much of the profits of the 
 bank as shall appear to the directors advisable; and, once in every three 
 years, the directors shall lay before the stockholders, at a general meeting, 
 for their information, an exact and particular statement of the debts which 
 shall have remained unpaid after the expiration of the original credit, for a 
 period of treble the term of that credit, and of the surplus of profits, if any, 
 after deducting losses and dividends. If there shall be a failure in the pay- 
 ment of any part of any sum subscribed by any person, copartnership, or body 
 politic, the party failing shall lose the benefit of any dividend which may have 
 accrued prior to the time for making such payment, and during the delay of 
 the same. 
 
 15. It shall be lawful for the directors of the said corporation to establish 
 offices wheresoever they shall think fit, within the Unitecf States, or the terri- 
 tories thereof, for the purposes of discount, deposite,and distribution; or for the 
 purposes of deposite and distribution only; and upon the same terms, and in 
 the same manner, as shall be practised at the bank; and to commit the ma- 
 nagement of the said offices, and the business thereof, respectively, to such 
 persons, and under such regulations, as they shall deem proper, not being con- 
 trary to law or to the constitution of the bank. Or, instead of establishing 
 such offices, it shall be lawful for the directors of the said corporation, from 
 time to time, to employ any other bank or banks, at any place or places that 
 they may deem safe and proper, to manage and transact tne business proposed 
 as aforesaid to be managed and transacted by such offices, under such agree- 
 ments, and subject to such regulations, as they shall deem just and proper. 
 
 16. The said corporation, all offices of discount, deposite, and distribution, 
 and of deposite ana distribution only, which shall be established by the said 
 directors as aforesaid, and all banks by the said directors employed in lieu of 
 such offices as aforesaid, shall be bound to receive upon deposite the treasury 
 notes of the United States which have been, or may be, hereafter issued, bv 
 virtue of any law or laws of the United States. But it shall be optional with 
 the said corporation to pay and discharge the checks or drafts of the persons 
 making such deposite in treasury notes, for the amount thereof, either in gold 
 or silver coin, or in the notes of the bank, or in treasury notes. And all banks 
 by the said directors employed as aforesaid, in lieu of the offices aforesaid, 
 shall be further bound to receive on deposite, and to circulate, the notes of 
 the said corporation, on the same terms, and in the same manner, as the notes 
 of the said banks, respectively, are received and circulated; and, from time to 
 time, to issue and exchange for the said notes of the said corporation, other 
 notes of the said corporation, or the notes of the said banks, respectively, or 
 treasury notes, at the option of the persons applying for such issue or exchange. 
 
 17. The said corporation shall, at all times, distribute among the offices of 
 discount, and deposite, and distribution, and of deposite and distribution only, 
 and at all the banks employed in lieu of such offices, as aforesaid, a sufficient 
 sum, in the various denominations of the notes of the said corporation, and in 
 the treasury notes which it may receive upon deposite from the Government, 
 to answer the demand therefor, and to establish a sufficient circulating me- 
 dium throughout the United States and the territories thereof. 
 
 18. The officer at the head of the Treasury Department of the United States 
 shall be furnished, from time to time, as often as he may require, not exceed- 
 ing once a week, with statements of the amount of the capital stock of the 
 said corporation, and of the debts due to the same; of the moneys deposited 
 therein, of the notes in circulation, and of the cash in hand; and shall have a 
 tight to inspect such general accounts in the books of the bank as shall relate 
 to the said statement: Provided, That this shall not be construed to imply a 
 right of inspecting the accounts of any private individual or individuals with 
 the bank. 
 
 SEC. 9. ^nd be it further enacted, That, if the said corporation, or any person 
 or persons for, or to the use of the same, shall deal or trade in buying or sel- 
 
PROCEEDINGS OF 1814. 525 
 
 ling any goods, wares, merchandise, or commodities, whatsoever, contrary to 
 the provisons of this act, all and every person and persons by whom any order 
 or direction for so dealing or trading shall have been given., and all and every 
 person and persons who shall have been concerned as parties or agents there- 
 in, shall forfeit and lose treble the value of the goods, wares, merchandises, 
 and commodities, in which such dealing and trade shall have been; one half 
 thereof to the use of the informer, and the other half thereof to the use of the 
 United States, to be recovered in an action at law with costs of suit. 
 
 SEC. 10. And be it further enacted, That, if the said corporation shall 
 advance or lend any sum of money tor the use or on account of the Govern- 
 ment of the United States, to an amount exceeding three hundred thousand 
 dollars; or of any particular State, to an amount exceeding fifty thousand dol- 
 lars; or of any foreign Prince or State, (unless previously authorized thereto by 
 a law of the United States) all and every person and persons, by and with 
 whose order, agreement, consent, approbation, and connivance, such unlawful 
 advance or loan shall have been made, upon conviction thereof, shall forfeit 
 and pay for every such offence treble the value or amount of the sum or sums 
 whicn shall have been so unlawfully advanced or lent; one fifth thereof to the 
 use of the informer, and the residue thereof to the use of the United States, to 
 be disposed of by law, and not otherwise. 
 
 SEC. 11. And be it further enacted, That the capital stock of the said 
 corporation, its dividends, deposites, and profits, its bills arid notes, and ge- 
 nerally, all its personal property and estate, whatsoever and wheresoever, 
 shall be exempt from all taxes imposed, as well by the authority of the Unit- 
 ed States, as by the authority of the several States: Provided always, That this 
 exemption shall not be extended, nor be deemed to extend, to the real estate 
 of the said corporation. 
 
 SEC. 12. And be it further enacted, That no other bank shall be establish- 
 ed by any future law of the United States, during the continuance of the 
 corporation hereby created; for which the faith of the United States is hereby 
 pledged, provided Congress may renew existing charters for banks in the Dis- 
 trict of Columbia, not increasing the capital thereof, and grant charters to 
 such banking associations, within the District of Columbia, as are at present 
 in operation, and which have already applied for acts of incorporation. And 
 notwithstanding the expiration of the term for which the said corporation'^ cre- 
 ated, it shall be lawful to use the corporate name, style, 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, arid mixed, but not for any other purpose, or in any other man- 
 ner whatsoever, nor for a period exceeding two years, after the expiration of 
 the said term of incorporation. 
 
 SEC. 13. And be it further enacted, That any committee specially appointed 
 by Congress for the purpose, shall have a right to examine into the doings of 
 the said corporation, and shall have free access to all their books and vaults, 
 and report their proceedings to Congress. 
 
 SEC. 14. And be it further enacted, That, during the continuance of this act, 
 and whenever required by the Secretary of the Treasury, the said corporation 
 shall dp and perform the several and respective duties of the commissioners of 
 loans, for the several States, or any one or more of them, at the times, in the 
 manner, and upon the terms, to be prescribed by the Secretary of the Treasury. 
 
526 BANK OF THE UNITED STATES. 
 
 HOUSE OF REPRESENTATIVES. 
 
 NOVEMBER 21, 1814. 
 
 The House took up the amendments reported by the committee of the 
 whole. 
 
 The amendments to the first section having been taken up, and the question 
 being about to be put generally; on motion ot Mr. FORSYTH, the question was 
 divided, and first put on agreeing to such amendments as add places of sub- 
 scription, and names of commissioners; and, with* modifications, that class of 
 amendments was agreed to. 
 
 The question was then stated on agreeing to the amendments which go to 
 change the times and mode of subscription, viz: to make the number of shares 
 500,000, at one hundred dollars, instead of 100,000, at five hundred dollars,* 
 to be subscribed and paid in on the two last days of January next, and the 
 three last days of each succeeding month in the year 1815. 
 
 On this question, Mr. FORSYTH, of Georgia, said he had no idea of renew- 
 ing, at this time, the debate on this subject, having already expressed his sen- 
 timents on this project. He wished it at the same time to be distinctly un- 
 derstood, that he was not prevented from so doing by any signs of impatience 
 exhibited in the House; because, he should never be deterred from doing his 
 duty by) any emotion which might be thereby excited. But he thought it 
 fair for the gentlemen, who advocated the amendments made by the commit- 
 tee to this bill, to make it as perfect as they could; and reserved the right, 
 when the bill should be perfected, to make such remarks as the subject should 
 appear to him to call for. As, however, the House had not expressed their 
 sense directly on the subject of the change of the principles of the bill, he 
 should call for the yeas and nays on the first question which should involve 
 the principle of the main amendment. 
 
 The amendments to the first section were then agreed to, in part; and the 
 section was further amended on suggestion of various gentlemen. 
 
 Mr. BRIGHAM, of Massachusetts, moved to strike out fifty, (the proposed 
 amount of capital stock) and insert twenty-jive in lieu thereof. This motion 
 Mr. B. sustained on a series of reasoning, founded on the impracticability of 
 filling up the stock of so large an institution, by means of a species of paper 
 already so greatly depreciated in some parts of the country. 
 
 Mr. CALHOUN replied to the argument of Mr. Brigham, and explained the 
 process by which the treasury notes, which appeared to alarm the gentleman 
 so much, would be absorbed. 
 
 Mr. LOWNDES, of South Carolina, explained at some length, and with much 
 clearness, the objections he entertained to the present magnitude of the capital 
 of the bank, founded on the disproportion of the paper to the specie to be 
 subscribed, and the impracticability of the circulation and absorption of so 
 much paper. He concluded his observations by intimating, that, if the gen- 
 tleman from Massachusetts would withdraw his motion, he (Mr. L.) would 
 substitute thirty instead of tiventy-five, as the amount to which he desired the 
 capital of the bank to be reduced. 
 
 Mr. BRIGHAM declined to vary his motion; but, subsequently, waived it un- 
 til the House should have acted on all the amendments proposed to the bill. 
 
 The House then proceeded to the amendments of the second section, which 
 embrace the principle of Mr. Calhoun's amendment. 
 
 SEC. 2. And be it further enacted, That it shall be lawful for any person, co-part- 
 nership, or body politic, to subscribe for so many shares of the said capital stock of 
 the said bank, as he, she, or they, shall think fit, and the sums respectively subscribed 
 shall be payable in the manner following, that is to say: ftix millions of dollars in gold 
 or silver coin of the United States, or in gold coin of Spain, or the dominions of Spain, 
 at the rate of one hundred cents for every twenty-eight grains, and sixty -hundredths 
 
PROCEEDINGS OF 1814. 527 
 
 of a grain of the actual weight thereof, or in other foreign gold or silver coin, at 
 the several rates prescribed by the first section of an act regulating the currency of 
 foreign coins in the United States, passed tenth day of April, one thousand eight hun- 
 dred and six; and forty -four millions of dollars thereof in such gold or silver coin, as 
 aforesaid, or in treasury notes, now authorized or to be authorized, to be issued in 
 the year one thousand eight hundred and fifteen . 
 
 Mr. FORSYTH moved to amend this section, by adding; the following clause 
 to the end thereof; which motion would restore the principle embraced by the 
 bill as first reported, viz: 
 
 " Or in the public debt of the United States, contracted by virtue of the act of Con- 
 gress, entitled ' An act authorizing a loan for a sum not exceeding eleven millions of 
 dollars,' passed the 14th day of March, 1812, or contracted by virtue of any subse- 
 quent act or acts of Congress authorizing a loan or loans." 
 
 This question was decided, without debate, by yeas and nays, as follows: 
 
 For the motion, 45, 
 
 Against it, 94. 
 
 So the motion was negatived. 
 
 A motion of Mr. GASTOX was more successful, being agreed to, to amend 
 the bill by striking out the wsrds, "six millions of dollars," and, in lieu there- 
 of, insert the words, "on each share twelve dollars;" and strike out u forty- 
 four millions of dollars,'' and insert the words "eighty-eight;" so that sub- 
 scriptions shall be paid in the proportion of twelve dollars in specie, and 
 eighty-eight in treasury notes, on each share of one hundred dollars. 
 
 Mr. SHARP, of Kentucky, moved to strike out, in the latter part of this 
 section, the words "in such gold or silver coin, as aforesaid, or" his object 
 being to require treasury notes, only, to be received in payment of the eighty- 
 eight dollars on each share allowed to be paid in that way. The motion was 
 negatived 75 to 58. 
 
 Mr. HAAVKINS, of Kentucky, then moved to add, after the words "now au- 
 thorized" in the latter clause of the above section, the words "to be issued;" 
 his object being to allow to be received in payment on the bank shares, as 
 well those treasury notes now in circulation, or already authorized to be put 
 in circulation, as those hereafter to be authorized, &c. The motion was ne- 
 gatived ayes 26. 
 
 The question on the amended section having been divided, w r as, on the sug- 
 gestion of Mr. KILBOURX, of Ohio, first taken on striking out so much of 
 the original second section of the bill as limits the subscription of any indi- 
 vidual, or body politic, (the United States excepted) to one thousand shares. 
 
 This part of the amended section having been agreed to, the question re- 
 curred on the main principle of the section as amended. 
 
 Mr. GROSVENOR, of New York, requested the yeas and nays on the ques- 
 tion of concurrence with the committee of the whole in agreeing to the 
 amendment. He believed the plan embraced in the amendment to be fanciful 
 and wholly impracticable, and such as would, in its failure, prove more ruin- 
 ous in its consequences to the community, than could be well anticipated; 
 he, therefore, desired to record his vote against it. 
 
 Mr. FISK, of Vermont, opposed the amendment, and conjured gentlemen, 
 on the same side with himself, to oppose this amendment, embracing a system 
 which, he said, he was confident would disappoint the hopes of its projectors, 
 and prostrate the party now in power. If the House should determine to ex- 
 clude the holders of the stock of the United States from any participation in 
 the subscription, and should permit the bank to go into operation, as was pro- 
 posed, whenever 13,200,000 dollars should be subscribed, it would fall wholly 
 into the hands of the opponents of the present administration, who would 
 never lend the United States a cent of the capital of the bank, but employ it, 
 as far as possible, in opposing the measures of the Government. The very 
 moment the subscription is opened, Mr. F. said, it would be filled by those 
 
528 BANK OF THE UNITED STATES. 
 
 who have modestly told you that they alone are competent to carry on the 
 operations of the Government, and its influence be employed by them against 
 the measures of the Government- Rather than follow such an ignis fatuus as 
 this, Mr. F. said, he would take his hat, make his bow, and retire from the 
 House at once. The bill did not contain a single provision to oblige a man to 
 pay in his subscription in treasury notes. The bill, he said, as proposed to 
 be amended, would completely disappoint its projectors. In the first place, 
 it would shut out our friends, all the subscribers to the old stock who have 
 exhausted their funds; and, in the next place, the only subscribers to the bank 
 would be those who wish us, as ,they say, to retire as soon as possible, and 
 who have not aided us very much in the prosecution of the war. They are 
 under no obligation, by this bill, to loan money to the Government; and they 
 would not do it until better times and better men being in the Government 
 (according to their modest opinion of themselves) should authorize them in 
 doing it. Mr. F. said he was for taking a practical course in whatever he 
 he did, and therefore he would never agree to such a system as this. 
 
 Mr. CALHOUX said, in reply to these remarks, that it was a sound rule in 
 legislation, not to act with a view to benefit one or another party, but with 
 a view to promote the national good. If a bank was tx> be erected to prop up 
 this or that party, Mr. C- said, it should not receive his sanction. In moving 
 the amendment, he said, he had not been governed by views of so limited a 
 character. He had regarded the nation as a nation, and not as divided into 
 two political parties. The subscription was equally open to both parties; and, 
 although the moneyed class attached to the ruling party might be exhaust- 
 ed, the farming interest was not in so miserable a situation. Mr. C. was not 
 willing to recognise the correctness of the picture which the gentleman had 
 drawn of the great republican party, as exhausted and moneyless. Although 
 there was great capital on one side, so there was on the other; and it is our 
 boast that the yeomanry, the substantial part of our population, are on that 
 side of the question to which we belong. The very amendments proposed, 
 and now objected to, present the opportunity to every capitalist, however in- 
 considerable, to share in the capital of the bank, &c. and to disseminate its 
 benefits all over the country, &c. As to the control over the bank, Mr. C. 
 contended that the amendments, retaining the power over deposites, and of 
 making the bills receivable for the revenue, or otherwise, gave the Government 
 a greater control than it before possessed over the operations of the bank, &c. 
 Legislation, on party principles, he said, must ever react on the party pur- 
 suing it; he would, therefore, not resort to it. No, said he, rather let us act 
 on national, on great principles. 
 
 Mr. FISK rejoined, and defended, with his usual point, the ground he had 
 taken. 
 
 Mr. [NGHAM, of Pennsylvania, took occasion, in behalf of the Committee 
 of Ways and Means, to disclaim the operation of any party feelings in recom- 
 mending to the House the system advocated by the gentleman from Vermont; 
 from whom, although he agreed with him in opposition to the present amend' 
 ment, he differed as to the grounds of his opposition. 
 
 The question was then taken, by yeas and nays, on agreeing to the second 
 section as amended, and decided in the affirmative, as follows: 
 
 For the amendment, 87. 
 
 Against it, 52. 
 
 NOVEMBER 22, 1814. 
 
 The House resumed the consideration of the remainder of the amendments 
 of the committee of the whole. 
 
 The amendment of the committee of the whole, to strike out the third sec- 
 tion of the original bill, (authorizing the Government to subscribe twenty 
 millions to the capital of the bank) was concurred in. 
 
PROCEEDINGS OF 1814, 529 
 
 That amendment being under consideration which strikes out so much of 
 the original bill as allows to the Government the appointment of five directors 
 of the bank- 
 It was opposed by Messrs. ROBERTSON, GHOLSON, and WRIGHT, and sup- 
 ported by Messrs. CALHOUN, GROSVENOR, and LEWIS. 
 
 [The advocates of this amendment contended that the power of appoint- 
 ment of five of the directors of ihe bank would be merely nominal, as to anv 
 control over the operations of the institution, which control would be much 
 better effected by the power of the Government to withhold its deposites, &c. 
 On the other hand, it was said that a large majority of the directors would 
 probably be, in future, as they have been heretofore, adverse to the politics of 
 the Government, and, unless properly guarded, would be disposed to thwart 
 its operations, and favor the views ot its opponents, &c. &c. ] 
 
 The question on concurring with the committee of the whole in this amend- 
 ment to the bill, was decided as follows: 
 
 For the amendment, 86. 
 
 Against it, - 64. 
 
 The House proceeded in the further consideration of the amendments to 
 the bill. 
 
 When the House came to that amendment to the tenth rule for the go- 
 vernment of the bank, which is expressed in the following words: "But the 
 said corporation may sell any part of the public debt, whereof its stock shall 
 be composed:" 
 
 A motion was made, by Mr. FORSYTH, so to amend this amendment as to 
 make it read as follows: u But the said corporation SHALL NOT sell any part 
 of the public debt, whereof its stock shall be composed, DURING THE PRESENT 
 WAR." 
 
 After a debate of considerable length and warmth, the question on the mo- 
 tion to amend the amendment was decided as follows: 
 
 For the motion, 64. 
 
 Against the motion, 73. 
 
 The motion of Mr. Forsyth having been thus rejected 
 
 The amendment reported by the committee of the whole, as first above 
 stated, was amended by adding thereto the following, on motion of Mr. RICH: 
 
 " Provided, That, during- the continuance of the present war, the said corporation 
 shall not, without the consent of Congress, sell or dispose of their public debt to an 
 amount above ten millions of dollars." 
 
 A motion was made by Mr. INGHAM, of Pennsylvania, further to amend 
 the said amendment, by adding to it as follows: nor, ctfter the ivur, any part 
 thereof, at a price less than its par value." 
 
 This motion was negatived. 
 
 The amendment of the committee of the whole, as amended, was then 
 agreed to. Other amendments were then considered and agreed to. 
 
 The amendment to the 12th rule for the. government of the bank, is to 
 strike out the following clause: 
 
 ' But the said corporation shall be bound to lend to the Government of the United 
 States thirty millions of dollars, at an interest not exceeding- six per centum per an- 
 num, in such sums, and at such periods, as. consistently with the objects of the Go- 
 vernment, may be made mutually convenient to the Government and the corporation, 
 whenever any law or laws shall authorize and require such loan or loans." 
 
 The question on concurring in this amendment, was decided in the affirma- 
 tive, as follows: 
 67 
 
530 
 
 BANK OF THE UNITED STATES. 
 Those who voted in the affimative, are. 
 
 i. Alston, 
 
 Messrs. Geddes, 
 
 Messrs. Potter, 
 
 Avery, 
 
 Grosvenor, 
 
 John Reed, 
 
 Bard, 
 
 Hale, 
 
 Wm. Reed, 
 
 Barret, 
 
 Hanson, 
 
 Rea, of Penn. 
 
 Baylies, of Mass, 
 
 Hasbrouck, 
 
 Rich, 
 
 Bayly, of Va. 
 
 Hurlburt, 
 
 Robertson, 
 
 Bigelow, 
 
 Ingersoll, 
 
 Ruggles, 
 
 Boyd, 
 
 Jackson, of R. I. 
 
 Sharp, 
 
 Bradley, 
 
 Kent, of N. Y. 
 
 Sheffey, 
 
 Brigham, 
 
 Kent, of Md. 
 
 Shipherd, 
 
 Burwell, 
 
 Kerr, 
 
 Smith, of N. Y. 
 
 Butler, 
 
 King, of Mass. 
 
 Smith, of Va. 
 
 Caperton, 
 
 Law r 
 
 Stanford, 
 
 Caldwell, 
 
 Lewis, 
 
 Stockton, 
 
 Calhoun, 
 
 Lovett, 
 
 Sturges, 
 
 Champion, 
 
 Lowndes, 
 
 Tallmadge, 
 
 Cilley, 
 
 M'Kee, 
 
 Taylor, 
 
 Clarke,' 
 
 MKim, 
 
 Thompson, 
 
 Crawford, 
 
 M'Lean, 
 
 Vose, 
 
 Creighton, 
 
 Miller, 
 
 Ward, of Mass. 
 
 Crouch, 
 
 Moore, 
 
 Ward, of N. J. 
 
 Culpeper, 
 
 Moseley, 
 
 Webster, 
 
 Cuthbert, 
 
 Markell, 
 
 Wheaton, 
 
 Davenport, 
 
 Oakley, 
 
 White, 
 
 Davis, of Mass. 
 
 Ormsby, 
 
 Wilcox, 
 
 Duval, 
 
 Pearson, 
 
 Wilson, of Mass. 
 
 Ely, 
 
 Pickering, 
 
 Winter, 
 
 Forney, 
 
 Pitkin, 
 
 Yancey 86. 
 
 Gaston, 
 
 Pleasants. 
 
 
 Those wfio voted 
 
 in the negative, are, 
 
 
 }. Alexander, 
 
 Messrs. Franklin, 
 
 Messrs. Lyle, 
 
 Anderson, 
 
 Gholson, 
 
 Mac on, 
 
 Barbour, 
 
 Goodwyn, 
 
 M'Coy, 
 
 Bines, 
 
 Gourdin, 
 
 Nelson, 
 
 Bowen, 
 
 Griffin, 
 
 Newton, 
 
 Cannon, 
 
 Hall, 
 
 Parker, 
 
 Chappell, 
 
 Harris, 
 
 Pickens, 
 
 Clopton, 
 
 Hawes, 
 
 Piper, 
 
 Comstock, 
 
 Hopkins, of Ky, 
 
 Rhea, of Tenn. 
 
 Conard, 
 
 Hubbard, 
 
 Roane, 
 
 Dana, 
 
 Humphreys, 
 
 Sage, 
 
 Davis, of Penn. 
 
 Hungerford, 
 
 Sevier, 
 
 Denoyelles, 
 
 Ingham, 
 
 Seybert, 
 
 Desha. 
 
 Irwin, 
 
 Smith, of Penn. 
 
 Earle, 
 
 Johnson, of Va. 
 
 Tannehill, 
 
 Eppes, 
 
 Kennedy, 
 
 Telfair, 
 
 Farrow, 
 
 Kershaw, 
 
 Udree, 
 
 Findley, 
 
 Kilbourn, 
 
 Wilson, of Penn. 
 
 Fisk, of N. Y. 
 
 Lefferts, 
 
 Wright 68. 
 
 Forsyth, 
 
 The House having under consideration the new section added to the bill 
 by the committee of the whole, giving the Congress power, at any time, to 
 appoint a special committee to examine into the state of the bank, 
 
 A motion was made by Mr. KILBOURN to amend the same by adding there- 
 to the following: 
 
 "And if, upon full investigation, it shall appear that the said corporation have ex- 
 ceeded their powers, or violated any of the provisions or restrictions of this act, it 
 shall be within the power of Congress to declare their charter void." 
 
PROCEEDINGS OF 1811 53J[ 
 
 This motion was negatived, after debate, and the new section concurred in. 
 
 All the amendments made in committee of the whole having been agreed 
 to 
 
 On motion of Mr, PICKENS, the House agreed to reconsider the disagreement 
 to Mi-. SHARP'S motion to amend the bill, by excluding other medium but 
 treasury notes being received in payment of that portion of the subscription 
 on each share, which is proposed to be paid in that way. 
 
 And the question being put on now agreeing to this amendment, alter de- 
 bate, the House adjournecf. 
 
 NOVEMBER 23, 
 
 Mr. IrviNG, of New York, presented a memorial from sundry persons, (on 
 behalf of five banks in the city of New York) appointed to examine into the 
 state of credit in that city, remonstrating against the passage of the bill be- 
 fore the House of Representatives, for the establishment of a national bank, 
 which they see with alarm, believing this to be the ^yorst possible time for the 
 creation of such an institution, and fearing that it would not relieve, but 
 rather augment, the present embarrassment of public and private credit. 
 They state, also, their impression that treasury notes, at their present inte- 
 rest, fundable at a higher interest, would circulate better, and be less liable to 
 depreciation, than the notes of such a bank. [These objections apply, and 
 are directed to those features principally of the bill which have been stricken 
 out by the House.] The memorial was read, and ordered to lie on the table. 
 
 The House resumed the consideration of the bill to " incorporate the sub- 
 scribers to the Bank of the United States of America." 
 
 The question depending yesterday, on Mr. SHARP'S motion, was, after fur- 
 ther debate, decided in the anirmatiw. 
 
 The bill having been further amended 
 
 A motion was made by Mr. G ASTON further to amend the bill by striking 
 out fifty millions, the proposed amount of the capital of the bank, arid in- 
 serting twenty in lieu thereof. 
 
 This motion was supported by Mr. WEBSTER, in a speech of considerable 
 length; which he had not concluded when the House anjourned. 
 
 NOVEMBER 25, 1814. 
 
 The House, on motion of Mr- CALHOUN, resumed the consideration of the 
 bill. 
 
 The question being on Mr. GASTON'S motion to substitute twenty for fifty 
 millions of dollars, as the amount of the capital of the bank. 
 
 Mr. WEBSTER concluded the speech which he commenced on Wednesday, 
 in opposition to the bill as it now stands. In the course of his remarks, to 
 day, lie indicated, generally, his v iews as to the sort ot bank which ought to 
 be established. He would have a bank of a limited amount, say twenty mil- 
 lions of capital; he would make it indispensable that it should pay specie, by 
 a provision that all notes not paid in specie, when properly presented, should 
 thenceforth bear a certain interest; and by inflicting a penalty on such direc- 
 tors as should, during the suspension of specie payment, consent to put the notes 
 of the bank in circulation. He was willing the Government should, if others 
 believed it necessary, hold some stock in the bank, but, at the extent, not to 
 exceed one half of the whole amount; the remaining half to be paid in specie, 
 or, at the discretion of the directors, in notes of existing banks, on condition 
 that such banks should agree to resume their specie payments within a given 
 time; and, if it was thought desirable, the Government might, he said, retain 
 the right to subscribe, hereafter, an additional five millions to the capital of 
 the bank. This was, generally, his plan. Upon the whole, he concluded by 
 Baying, although there were many points in which the present bill was pre- 
 
532 BANK OF THE UNITED STATES. 
 
 ferable to the bill first reported, still, with its present amount of capital, ancf 
 the great proportion of stock to specie, it was wholly objectionable, in his 
 mincl, and he could not vote for it. When Mr. W. sat down, 
 
 Mr. LOWNDES, of South Carolina, said, if he conceived any advantage to 
 the nation could result from permitting this discussion to progress, he should 
 not make the motion he was about to offer. But, believing, from the difference 
 of views entertained in different parts of the House, and from the variety of 
 ulans which had been offered, that longer discussion would merely consume 
 time without a prospect of the final passage of the bill; and believing, also, 
 that, by a reference to a select committee, a concurrence of the views of all 
 parties might be obtained in favor of one plan, he moved that this bill be re- 
 ferred to a select committee. 
 
 Mr. INGHAM, of Pennsylvania, said he was in favor of the recommitment 
 of the bill, because he believed that, in its present form, it would not pass the 
 House, but that a bill might be devised that would meet the views of gentle- 
 men on all sides of the House. It was possible, at least, a combination of 
 the views ot different gentlemen might be effected, which might produce great 
 good, and could do no harm. He was, therefore, in favor of the recommit- 
 ment, as the only means of effecting this desirable object. 
 
 Mr. FISK, of New York, said he merely rose to add his wish to that of his 
 friend from Pennsylvania. It was as certain as any thing yet in suspense 
 could be, that the bill would not pass the House in its present shape. That 
 it might be kept in possession of the House, and not destroyed without an 
 effort to preserve it, he hoped the House would agree to refer it to a select 
 committee for such modification as might appear to be calculated to meet the 
 views of the House. The opinions of gentlemen, on all sides, had been so 
 fully expressed, that the committee, being in possession of them, would be 
 able to mould the bill accordingly. 
 
 Mr. CALHOUN, of South Carolina, said it must be obvious, 'from the course 
 of the debate, if it were not from the nature of the subject,, that a great di- 
 versity of sentiment existed on this head. No question could exhibit a greater 
 division of sentiment, confined neither to party or locality. As he was ex- 
 tremely anxious that the bank showl-d be established, Mr, C. said he should 
 be averse to throwing any obstacle in the way of the practicability of the 
 measure, and would therefore heartily assent to the motion for recommit- 
 ment. 
 
 The question was then taken on recommitment, and decided in the affirma- 
 tive without a division. 
 
 And Mr. Lowndes, Mr. Fisk,. of New York, Miv Calhoun, Mr. Ingham. 
 Mr. Forsyth, Mr. Oakley, and Mr. Gaston, were appointed the said com- 
 mittee. 
 
 NOVEMBER 28. 
 
 Mr. LOWNDES, of S. C. from the select committee to whom was committed 
 the bill to incorporate the subscribers to the Bank of the United States of 
 America, reported, that the committee had had said bill under consideration, 
 but not having been able to discover any means of uniting the conflicting opin- 
 ions on the subject, had, therefore, directed him to report the bill without 
 amendment. Mr. L. also laid before the House a letter obtained from the 
 Secretary of the Treasury, by the committee, on the subject of the amend- 
 ments made to the bank bill. 
 
 [This letter was read. It is written with remarkable frankness, and ex- 
 presses a decided disapprobation of the issue of treasury notes, proposed 
 by the amendments made to the bill. See page 535.] 
 
 A motion was made, by Mr. HANSON, to print the letter; which motion being 
 nbjected to, was declared not to be in order at this time. 
 
 The House proceeded to the consideration of the bilL 
 
PROCEEDINGS OF 1814. 535 
 
 The question depending when the bill was referred to a select committee, 
 now recurred. It was on a motion of Mr. GASTON to strike out fifty millions 
 (the proposed capital of the bank) and insert twenty 
 
 This motion was immediately decided, without debate, by the following 
 vote: 
 
 For the motion, 54, 
 
 Against it, - 85. 
 
 Mr. LOWNDES then moved to amend the bill bv striking out fifty and in- 
 serting thirty millions, which question was decided without debate by the fol- 
 lowing vote: 
 
 For the motion, 76, 
 
 Against it, - 67. 
 
 So the House determined to reduce the capital of the bank to thirty millions. 
 Mr. LOWNDES then suggested several amendments, to make other parts of 
 the bill correspond with the amendment just made; which were agreed to. 
 
 Mr. EASTON then moved an amendment to the bill, and spoke some time in 
 support of it, the object of which was, to require the directors of the bank, at 
 any time when 100,000 dollars should be subscribed and paid in, or held, by 
 citizens of Missouri territory, and when the same shall be required by three- 
 fourths of such stockholders, to establish an office of discount and dcposite at 
 St. Louis, in the Missouri territory. 
 
 This motion was supported, also, in a. cogent manner, by Mr. M'KEE, of 
 Kentucky. 
 
 It was, however, negatived, twenty-seven only rising in favor of it. 
 
 Mr. HANSON, of Maryland, then moved to strikeout the first section of the 
 bill; which he supported by a speech of considerable length. He was opposed 
 to the bill as it now stood, as an inefficient and impracticable measure, not 
 suited to the great exigency of the times. 
 
 Mr. CALHOUN, of S. C. followed in reply to some points of Mr. HANSON'S 
 speech, in defence of the bill. 
 
 Mr. GROSVENOR, of New York, next took the floor, and made an animated 
 speech against the bill as it now stood., and giving the preference to the bill 
 originally reported by the Committee of Ways and Means. 
 
 When Mr. GROSVENOR concluded 
 
 Mr. JOHNSON, of Kentucky, assigning as a reason therefor his anxiety to 
 expedite the public business, and proceed to the adoption of those measures 
 which the times imperiously demand, required the previous question. 
 
 The call was sanctioned by a vote of 73 to 71; but some misapprehension of 
 the question having taken place, a second count took place, after some little 
 confusion, and there appeared to be 62 for the previous question, and 70 
 against it. So the call was not duly sanctioned. 
 
 After a few remarks from Mr. MACON and others, as to the effect of strik- 
 ing out the first section of the bill, which some appeared to think would have 
 the effect to destroy the bill, 
 
 Mr. HANSON, to save difficulty in that respect, withdrew his motion to strike 
 out the first section of the bill. 
 
 Mr. JOHNSON then renewed his demand of the previous question, (which 
 precludes all further amendment as well as debate) which demand was se- 
 conded by a vote of 62 to 59. 
 
 The previous question was then put in the following form, viz: " Shall the 
 main question be now put?" And decided by yeas and nays as follows : 
 For the previous question, 75, 
 
 Against it, 67. 
 
 The requisite number having required the main question to be put, it wa.s 
 put on the engrossing' the bill for a I hint reading-; and was decided as tollo\\>: 
 
534 
 
 BANK OF THE UNITED STATES. 
 
 Those who voted 
 
 in the affirmative, are, 
 
 
 Messrs. Alexander, 
 
 Messrs. Earle, 
 
 Messrs. M'Lean, 
 
 Alston, 
 
 Findley, 
 
 Montgomerv, 
 
 Bines, 
 
 Forney, 
 
 Oakley, 
 
 Bradley, 
 
 Gaston, 
 
 Pearson, 
 
 Caldwell, 
 
 Gourdin, 
 
 Pickens, 
 
 Calhoun, 
 
 Griffin, 
 
 Hea, of Penn. 
 
 Cannon, 
 
 Harris, 
 
 Rich, 
 
 Chappell, 
 
 Hasbrouck, 
 
 Robertson. 
 
 Clark, 
 
 Irving', 
 
 Sevier, 
 
 Condict, 
 
 Kent, of Md. 
 
 Sharp, 
 
 Crawford, 
 
 Kerr, 
 
 Skinner, 
 
 Creighton, 
 
 Kershaw, 
 
 Smith, of Vir. 
 
 Crouch, 
 
 Kilbourn, 
 
 Taylor, 
 
 Culpeper, 
 
 King, ofN. C. 
 
 Ward, ofN. J. 
 
 Cuthbert, 
 
 Lowndes, 
 
 Winter, 
 
 Duval, 
 
 M'Kee, 
 
 Yancey 49. 
 
 Those who voted 
 
 ill the negative, are, 
 
 
 Messrs. Anderson, 
 
 Messrs. Goodwin, 
 
 Messrs. Pickering, 
 
 Avery, 
 
 Grosvenor, 
 
 Piper, 
 
 Barber, 
 
 Hall, 
 
 Pitkin, 
 
 Bard, 
 
 Hanson, 
 
 Pleasants, 
 
 Baylies, of Mass. 
 
 Hawes, 
 
 Potter, 
 
 Bayly, of Va. 
 
 Hopkins, of Ky. 
 
 John Reed, 
 
 Bigelow, 
 
 Hubbard, 
 
 Wm. Reed, 
 
 Bowen, 
 
 Hufty, 
 
 Rhea, of Tenn. 
 
 Boyd, 
 
 Humphreys, 
 
 Rhone, 
 
 Bradbury, 
 
 Hungerford, 
 
 Ruggles, 
 
 Brigham, 
 
 Ingersoll, 
 
 Sage, 
 
 Brown, 
 
 Ingham, 
 
 Schureman, 
 
 Burwell, 
 
 Irwin, 
 
 Sevbert, 
 
 Cilley, 
 
 Jackson, of R. I. 
 
 Sheffey, 
 
 Clopton, 
 
 Johnson, of Va. 
 
 Shipherd, 
 
 Comstock, 
 
 Johnson, of Ky. 
 
 Smith, of Penn. 
 
 C onnard, 
 
 Kennedy, 
 
 Stanford, 
 
 Cooper, 
 
 Kent, ofN. Y. 
 
 Stockton, 
 
 Cox, 
 
 King, of Mass. 
 
 Strong 
 
 Dana, 
 
 Law, 
 
 Sturges, 
 
 Davenport, 
 
 Lefferts, 
 
 Taggart, 
 
 Davis, of Mass. 
 
 Lewis, 
 
 Tanneliill, 
 
 Davis, of Penn. 
 
 Lovett, 
 
 Telfair, 
 
 Denoyelles, 
 
 Lyle, 
 
 Thompson, 
 
 Desha, 
 
 Macon, 
 
 Udree, 
 
 Ely, 
 
 M'Coy, 
 
 Vose, 
 
 Eppes, 
 
 M'Kim, 
 
 Ward, oi Mass, 
 
 Evans, 
 
 Miller, 
 
 Webster, 
 
 Farrow, 
 
 Moore, 
 
 Wheaton, 
 
 Fisk, of Vt. 
 
 Moseley, 
 
 White, 
 
 Fisk, of N. Y. 
 
 Murfree, 
 
 Wilcox, 
 
 Forsyth, 
 
 Markell, 
 
 Williams, 
 
 Franklin, 
 
 Nelson, 
 
 Wilson, of Mass. 
 
 Geddes, 
 
 Newton, 
 
 Wilson, of Pa. 104. 
 
 Gholson, 
 
 Parker, 
 
 
 So the House decided that the bill should not be read a third time in other 
 words, that it should be rejected. 
 
 Mr. FORSYTH, of Geo. then rose, and said he had voted in the majority 
 against the bill; and was, therefore, at liberty to move a reconsideration of 
 the vote just taken. This motion he did make, with a view to retain the bill 
 still in possession of the House, in order to recommit it: that the House might 
 
PROCEEDINGS OF 1814. 535 
 
 not be deprived of an opportunity of passing a bank bill during the present 
 session. 
 
 This motion gave rise to considerable sensation in the House, as, indeed, had 
 all the proceedings of this day. 
 
 The motion was opposed by Mr. MILLER, of N. Y. and Mr. FISK, of Vt. and 
 advocated by Mr. FISK, of N. Y. and Mr. FARROW, of S. C. &c. &c. 
 
 At length, Mr. FORSYTH withdrew his motion for the present, intimating 
 that he might renew it to-morrow. 
 
 Mr. CALHOUN moved to print the Secretary of the Treasury's letter, read 
 this morning; when the House adjourned. 
 
 NOVEMBER 29, 1814. 
 
 Ordered, That the letter of the Secretary of the Treasury, laid before the 
 House yesterday, by the chairman of the committee, to which was committed 
 the bill to incorporate the subscribers to the Bank of the United States, be 
 referred to the Committee of Ways and Means. 
 
 The letter of the Chairman, and the Secretary's reply, are here inserted. 
 
 WASHINGTON, November 27 , 1814. 
 SIR: 
 
 The committee of the House of Representatives, to which the bank bill 
 was recommitted, on Friday last, have directed me to request you to commu- 
 nicate your opinion in relation to the effect which a considerable issue of trea- 
 sury notes (to which should be attached the quality of being receivable in sub- 
 scriptions to the bank) might have upon the credit of the Government, and 
 particularly upon the prospects of a loan for 1815. 
 
 As the bill, as it was referred to the committee, provides for the subscrip- 
 tion of forty-four millions of treasury notes, to form, with six millions of spe- 
 cie, the capital of the bank, any information which you may think proper to 
 give, either in relation to the practicability of getting them into circulation 
 without depreciation, or in regard to their operation on any part of our fiscal 
 system afterwards, vyill be very acceptable. 
 
 I am, sir, very respectfully, your obedient servant, 
 
 WM. LOWNDES. 
 To the Hon. the. Secretary nf the Treasury. 
 
 TREASURY DEPARTMENT, November 27 ', 1814. 
 SIR: 
 
 I have the honor to acknowledge the receipt of your letter, requesting, 
 for a committee of the House of Representatives, an opinion upon the follow- 
 ing inquiries: 
 
 1. The effect which a considerable issue of treasury notes, with the quality 
 of being receivable in subscriptions to a national bank, will have upon the 
 credit of the Government; and particularly upon the prospects of a loan for 
 1815? , 
 
 2. The practicability of getting forty-four millions of treasury notes (form- 
 ing, with six millions of specie, the capital for a national bank) into circula- 
 tion, without depreciation: 1 
 
 The inquiries of the committee cannot be satisfactorily answered, in the ab- 
 stract; but must be considered in connexion with the state of our finances 
 and the state of the public credit. 
 
 When I arrived at Washington, the treasury was suffering under every 
 kind of embarrassment. The demands upon it were great in amount, while 
 the means to satisfy them were comparatively small; precarious in the collec- 
 tion, and difficult in the application. The demands consisted of dividends 
 upon old and new funded debt, of treasury notes, and of legislative appropri- 
 ations for the army, the navy, and the current service; all urgent and impor- 
 
536 BANK OF THE UNITED STATES. 
 
 lant- The means consisted, first, Of the the fragment of an authority to bor- 
 row money, when nobody was disposed to lend, and to issue treasury notes 
 which none but necessitous creditors, or contractors in distress, or commissa- 
 ries, quartermasters, and navy; agents, acting, as it were, officially, seemed 
 willing to accept. Second, Of the amount of bank credits scattered through- 
 out the United States, and principally in the Southern and Western banks, 
 which had been rendered in a great degree useless, by the stoppage of payments 
 in specie, and the consequent impracticability of transferring the public funds 
 from one place, to meet the public engagements in another place. And third. 
 Of the current supply of money from the imposts, from internal duties, ana 
 from the sales of public land, which ceased to be a foundation of any rational 
 estimate, or reserve, to provide even for the dividends on the funded debt, 
 when it was found that the treasury notes (only requiring, indeed, a cash pay- 
 ment at the distance of a year) to whomsoever they were issued at the trea- 
 sury, and almost as soon as they were issued, reached the hands of the col- 
 lectors, in payments of debts, duties, and taxes; thus disappointing and de- 
 feating the only remaining expectation of productive revenue. 
 
 Under these circumstances (which I had the honor to communicate to the 
 Committee of Ways and Means) it became the duty of this department to 
 endeavor to remove the immediate pressure from the treasury $ to endeavor to 
 restore the public credit; and to endeavor to provide for the expenses of the 
 ensuing year. The only measures that occurred to my mind, for the accom- 
 plishment of such important objects, have been presented to the view of Con- 
 gress. The act authorizing the receipt of treasury notes, in payment of sub- 
 scriptions to a public loan, was passed, I fear, too late to answer the purpose 
 for which it was designed. It promises, at this time, little relief, either as an 
 instrument to raise money, or to absorb the claims for treasury notes, which 
 are daily becoming due. From this cause, and from other obvious causes, the 
 dividend on the funded debt has not been punctually paid; a large amount of 
 treasury notes has already been dishonored; and the hope of preventing fur- 
 ther injury and reproach, in transacting the business of the treasury, is too 
 visionary to afford a moment's consolation. 
 
 The actual condition of the treasury, thus described, will serve to indicate 
 the state of the public credit. Public credit depends essentially upon public 
 opinion. The usual test of public credit is, indeed, the value of the public 
 debt. The faculty of borrowing money is not a test of public credit: for a 
 faithless Government, like a desperate individual, has only to increase the 
 premium, according to the exigency, in order to secure a loan. Thus public 
 opinion, manifested in every form, and in every direction, hardly permits us, 
 at the present juncture, to speak of the existence of public credit; and yet, it 
 is not impossible that the Government, in the resources of its patronage and 
 its pledges, might find the means of tempting the rich and the avaricious to 
 supply its immediate wants. But, when the wants of to-day are supplied, 
 what is the new expedient that shall supply the wants of to-morrow? If it is 
 now a charter of incorporation, it may then be a grant of land; but, after all, 
 the immeasurable tracts of the western wild would be exhausted in successive 
 efforts to obtain pecuniary aids, and still leave the Government necessitous, 
 unless the foundations of public credit were re-established and maintained. 
 In the measures, therefore, which it has been my duty to suggest, 1 have en- 
 deavored to introduce a permanent plan for reviving the public credit; of 
 which the facility of borrowingmoney in anticipation ot settled and productive 
 revenues, is only an incident, although it is an incident as durable as the plan 
 itself. The outline seemed to embrace whatever was requisite; to leave no 
 doubt upon the power and the disposition of the Government, in relation to 
 its pecuniary engagements; to dimmish, arid not to augment, the amount of 
 the public debt in the hands of individuals; and to create general confidence, 
 rather by the manner of treating the claims of the present class of creditors, 
 than by the manner of conciliating the favor of a new class. 
 
 With these explanatory remarks, sir, I proceed to answer, specifically, the 
 questions which you have proposed. 
 
PROCEEDINGS OF 1814. 537 
 
 1. I am of opinion that a considerable issue of treasury notes, with the 
 quality of being receivable in subscriptions to a national bank, will have an 
 injurious effect upon the credit of the Government, and also upon the prospects 
 of a loan for 1815. 
 
 Because it will confer, gratuitously, an advantage upon a class of nevy cre- 
 ditors, over the present creditors of the Government, standing on a footing of 
 at least equal merit. 
 
 Because it will excite general dissatisfaction among the present holders of 
 the public debt; and general distrust among the capitalists, who are accus- 
 tomed to advance their money to the Government. 
 
 Because a quality of subscribing to the national bank, attached to treasury 
 notes exclusively, will tend to depreciate the value of all public debt, not 
 possessing that quality; and whatever depreciates the value of the public debt 
 in this way, must necessarily impair the public credit. 
 
 Because the specie capital of the citizens of the United States, so far as it 
 may be deemed applicable to investments in the public stocks, has already, in 
 a great measure, been so vested; the holders of the present debt will be una- 
 ble to become subscribers to the bank (if that object should, eventually,prove 
 desirable) without selling their stock at a depreciated rate, in order to procure 
 the whole amount of their subscriptions in treasury notes; and a general de- 
 pression in the value of the public debt will inevitably ensue. 
 
 Because the very proposition of making a considerable issue of treasury 
 notes, even with the quality of being subscribed to a national bank, can only 
 be regarded as an experiment, on which it seems dangerous to rely. The 
 treasury notes must be purchased., at par, with money; a new set of creditors 
 are to be created; it may, or it may not, be deemed an object of speculation 
 by the money holders to subscribe to the bank; the result of the experiment 
 cannot be ascertained, until it will be too late to provide a remedy in the case 
 of failure; while the credit of the Government will be affected by every cir- 
 cumstance which keeps the efficacy of its fiscal operations in suspense or 
 doubt. 
 
 Because the prospect of a loan for the year 1815, without the aid of a bank, 
 is faint and unpromising; except, perhaps, so far as the pledge of a specific tax 
 may succeed; and then, it must be recollected that a considerable supply of 
 money will be required for the prosecution of the war, beyond the whole 
 amount of the taxes to be levied. 
 
 Because, if the loan for the year 1815 be made to depend upon the issue of 
 treasury notes, subscribable to the national bank, it will probably fail, for the 
 reasons which have already been suggested; and, if the loan be independent of 
 that operation, a considerable issue of treasury notes, for the purpose of creat- 
 ing a bank capital, must ? it is believed, deprive the Government of every 
 chance of raising money in any other manner. 
 
 2. I am of opinion that it will be extremely difficult, if not impracticable, 
 to get forty-four millions of treasury notes (forming, with six millions of spe- 
 cie, the capital of a national bank) into circulation, with or without depre- 
 ciation. 
 
 Because, if the subscription to the bank becomes an object of speculation, 
 the treasury notes will probably be purchased at the treasury and at the loan 
 offices, and never pass into circulation at all. 
 
 Because, whatever portion of the treasury notes might pass into circulation, 
 would be speedily withdrawn, by the speculators, in the subscription to the 
 bank, after arts had been employed to depreciate their value. 
 
 Because it is not believed that, in the present state of the public credit, 
 forty-four millions of treasury notes can be sent into circulation. The only 
 difference between the treasury notes now issued and dishonored and those 
 proposed to be issued, consists in the subscribable quality; but reasons have 
 been already assigned for an opinion, that this difference does not afford such 
 confidence in the experiment, as seems requisite to justify a reliance upon it, 
 for accomplishing some of the most interesting objects of the.Government. 
 
 I must beg you, sir. ( pardon the haste with which I have written these 
 68 
 
538 BANK OF THE UNITED STATES'. 
 
 general answers to your inquiries. But, knowing the importance of time? 
 and feeling a desire to avoid every appearance of contributing to the loss of a 
 moment, I have chosen rather to rest upon the intelligence and candor of the 
 committee, than to enter upon a more labored investigation of the subject re- 
 ferred to me. 
 
 I have the honor to be, very respectfully, sir, your moat obedient servant, 
 
 A. J. DALLAS. 
 
 WILLIAM LOWNDES, Esquire. 
 
 NOVEMBER 29, 1814. 
 
 Mr. KiLBouRNy of Ohio, said he had ever considered it to be the interest 
 of the United States that a national bank should be established, for the con - 
 venient management of its finances. It was with satisfaction he found that to 
 be the opinion of a great majority of the House, by the vote some time ago r 
 on the proposition that it was expedient to establish a national bank. The 
 project before the House having been rejected, he held in his hand a resolu- 
 tion embracing a sketch of a plan, which, if approved, might be put into the 
 shape of a bill. Mr. K. then offered his resolution for consideration. 
 
 [The resolution embraced the same plan, with a few variations, as that con- 
 tained in the bill which was yesterday rejected by the House.] 
 
 This motion the SPEAKER pronounced to be out of order, as in substance 
 and matter the same as that already rejected by the House, and which, there- 
 fore, could not now be resumed, unless by a vote of reconsideration to-day. 
 
 Mr. KILBOURN remarked, that he had not understood that his motion would 
 be considered by the chair out of order, or he would not have proposed it, 
 He the more readily withdrew it, because he understood that it was yet in- 
 tended to move a reconsideration of the vote of yesterday. 
 
 [No reconsideration was moved to-day of the national bank bill, which was, 
 therefore, finally rejected in the House, but revived in the Senate.] 
 
 Mr. KILBOURN'S motion was as follows: 
 
 Resolved, That the Committee of Ways and Means be instructed to pre- 
 pare, in due form, and report to this House, a bill to establish a national bank, 
 of which the following shall be the principal or prominent features, viz: It 
 shall be called the National Bank of the United States. It shall be seated in 
 the city of Philadelphia, but may have branches throughout the Union. The 
 capital stock thereof shall be fifty millions of dollars, divided into five hun- 
 dred thousand shares, of one hundred dollars each. Thirty millions of the 
 capital may be subscribed bv individuals, companies, and corporations; and 
 twenty millions thereof shall be subscribed by the Secretary of the Treasury, 
 on behalf of the United States- The thirty millions, subscribed by individu- 
 als, companies, and corporations, shall be paid at proper periods, as follows, 
 vix: Six millions in specie, eighteen millions in stock created since the year 
 1811, and six millions in treasury notes issued since the commencement of the 
 war; that is to say: on each share twenty dollars in specie, sixty dollars in 
 stock, and twenty dollars in treasury notes. The twenty millions subscribed 
 for the United States, shall be paid in treasury notes, hereafter to be issued, 
 or in stock of the United States, to be hereafter created. For the manage- 
 ment of the bank, there shall be fifteen directors, nine of whom shall be elect- 
 ed by the individual stockholders, and six shall be nominated by the Secre- 
 tary of the Treasury, and appointed by the President of the United States. 
 The board of directors shall appoint the president, and all other officers and 
 servants of the principal bank, and of the branches. The charter to continue 
 twenty years; and no other bank charters to be granted by Congress during 
 that time, except to the banking associations now formed within the District 
 of Columbia. Subscriptions to be opened in one or more places in every State 
 
PROCEEDINGS OF 1814. 539 
 
 \\u\ Territory, and in the District of Columbia, under the care of proper su- 
 perintendents*. The bank shall go into operation so soon as $1,200,000 [as 
 intended twelve millions of dollars] in due proportion of specie, stock and 
 treasury notes, is paid in upon the subscriptions. The bank shall be autho- 
 rized to receive, upon .all loans it shall make, an interest at the rate of five 
 per cent, per annum, and no more. When the subscriptions shall be filled to 
 the amount of fifty millions, and the same be paid in, the bank may be requir- 
 ed to loan to the Government $25,000,000, and, at any; time prior to the com- 
 pleting of that amount of subscription, it may be required to loan to Govern 
 tnent in that proportion, to the amount actually subscribed and paid in. It 
 shall be the right and duty of the Secretary of the Treasury to inspect all the 
 books of business of the bank, and Congress may appoint committees for that 
 purpose. And the President of the United States shall be empowered, in cer- 
 tain cases, and during certain limited periods, to authorize or direct the sus- 
 pension of specie payments at the bank, or to substitute therefor, certain 
 treasury notes; which suspension, or substitution, with the causes thereof, he 
 shall make public by proclamation; and the same in like manner to recall and 
 revoke, when the cause or causes shall cease to operate; or, in case of their 
 continuance, to lay the same before Congress at the next session thereafter, 
 that they may take such measures thereon as shall appear to them expedient. 
 
 Had the foregoing been received and adopted by the House, he intended to 
 have added the following proposition, viz: Congress shall have power, when 
 they shall deem it expedient, to extend the capital of the bank to $60,000,000. 
 by authorizing a further subscription, on the part of the United States, of 
 $10,000,000, payable in six per cent, stock of the United States; and in such 
 case, there shall be appointed, as above, on behalf of the Government, three 
 additional directors in the board. 
 
 i3TH CoNORZSg,? 
 
 3d Session. $ 
 
 SEPTEMBER 30, 1814. 
 
 Mr. GERMAN presented the petition of David M. Clarkson, and others, 
 itizens of New York, praying the establishme 
 sons therein stated; and the petition was read. 
 
 OCTOBER 31, 1814. 
 On motion by Mr. SMITH, 
 
 Resolved, That the petition of David M. Clarkson, and others, citizens of 
 New York, praying the establishment of a national bank, presented the 30th 
 ultimo, be referred to a select committee, to consist of five members, to con- 
 sider and report thereon by bill or otherwise. 
 
 Ordered, That Messrs. King, Smith, Taylor, Bibb, and Mason, be the com- 
 mittee. 
 
 On the 2d December, Mr. King, from the said committee, reported a bill to 
 incorporate the subscribers to the Bank of the United States of America; which 
 then had its first reading. 
 
 A bill to incorporate the subscribers to the Bank of the United States of America. 
 
 Be it enacted by the Senate and House of Representatives of the United 
 States of America in Congress assembled, That a Bank of the United States 
 of America shall he established, the capital stock of which shall be fifty mil- 
 lions of dollars, and no more, divided into one hundred thousand shares, of 
 five hundred dollars each share, and that subscriptions for forty millions of 
 dollars, towards constituting the said capital stock, shall be opened on the 
 
540 BANK OF THE UNITED STATES. 
 
 Monday of next, at the following places, viz: Boston, New 
 
 York, Philadelphia, Baltimore, Richmond, Charleston, and Pittsburg, 
 under the superintendence of the following persons, as commissioners to re- 
 ceive the same: at Boston, James Lloyd, Thomas Perkins, and William 
 
 Gray; at New York, ; at Philadelphia, Jared Ingersoll, Thomas M. 
 
 Willing, Stephen Girard, Chandler Price, Anthony Taylor 5 at Baltimore, 
 James A, Buchanan, Henry Payson, William Wilson; at Richmond, Benja- 
 min Hatcher, John Brockenborough, William Preston,* at Charleston, John 
 C. Faber* John Potter, James Carson; at Pittsburg, George Robinson, Samuel 
 Robert, and Henry Baldwin: which subscriptions shall continue open every 
 day, from the time of opening the same, from ten o'clock, in the forenoon, un- 
 til four o'clock, in the afternoon, until the Saturday following,. at four o'clock, 
 in the afternoon, when the same shall be closed; and, immediately thereafter, 
 the commissioners, or any two of them, at the respective places aforesaid, 
 shall cause two transcripts, or fair copies of such subscriptions, to be made* 
 one of which they shall send to the Secretary of the Treasury, one they shall 
 retain, and the original shall, within three days from the closing of the same,, 
 be, by the said commissioners, transmitted to the said commissioners at Phi- 
 ladelphia, or to one of them; and, on the receipt thereof, the said commis- 
 sioners at Philadelphia, or any three of them, shall, immediately thereafter, 
 convene, and proceed to take an account of the said subscriptions; and if more 
 than the amount of forty millions of dollars shall have been subscribed, then 
 the said last mentioned commissioners shall apportion the same among the 
 several subscribers, ^according to their several and respective subscriptions: 
 Provided^ however ', That such commissioners shall, by such apportionment, 
 allow and apportion to each subscriber, at least, one share; ami, in case the 
 aggregate amount of the said subscriptions shall exceed forty millions of dol- 
 lars, the said commissioners, after having apportioned the same, as aforesaid, 
 shall cause lists of the said apportioned subscriptions to be made out, includ- 
 ing, in each list, the apportioned subscription for the place where the original 
 subscription was made, one of which lists shall be transmitted to the commis- 
 sioners, or to one of the commissioners, under whose superintendence such 
 subscriptions were originally made, that the subscribers may ascertain from 
 them the number of shares apportioned to such subscribers, respectively; and 
 if the amount of forty millions of dollars shall not be subscribed, during the 
 period aforesaid, at all the places aforesaid, the subscription, to complete the 
 said sum, shall afterwards be, and remain open at Philadelphia, under the 
 superintendence of the said commissioners appointed at that place, and the 
 subscription may be then made by any corporation, copartnership, or person, 
 for any number of shares not exceeding the amount required to complete the 
 said sum of forty millions of dollars; '.'and in case of the death, or refusal to 
 serve, of any of the commissioners, aforesaid, it shall be lawful for the Pre- 
 sident of the United States to supply the vacancy, or vacancies, thus created, 
 by appointing some suitable person, or persons." 
 
 SEC. 2. And be it further enacted, That it shall be lawful for any person, 
 copartnership, or body politic, to subscribe for so many shares of the said 
 capital stock of the said bank, as he, she, or they, shall think tit, not exceed- 
 ing one thousand shares, except as is hereinafter provided for the subscription 
 on behalf of the United States; and the sums respectively subscribed, except 
 on behalf of the United States, as is hereinafter provided, shall be payable in 
 the manner following; that is to say: five millions of dollars thereof in gold 
 or silver coin of the United States, or of foreign coin at the value heretofore 
 established by the act of Congress, entitled an " Act regulating the currency of 
 foreign coins," passed the 10th April, 1806; twenty-seven millions of dollars 
 thereof in gold or silver coin, as aforesaid, or in the public debt of the United 
 States, contracted by virtue of the act of Congress, entitled "An act autho- 
 rizing a loan for a sum not exceeding eleven millions of dollars," passed the 
 fourteenth day of March, one thousand eight hundred and twelve, or contract- 
 ed, or to be contracted, by virtue of any subsequent act and acts of Con- 
 gress, heretofore passed, authorizing a loan or loans; and eight millions of 
 
PROCEEDINGS OF 1814. 
 
 dollars thereof in gold or silver coin, or in treasury notes, issued under the 
 act of Congress, entitled " An act to authorize the issuing of treasury notes," 
 passed the thirtieth day of June, one thousand eight hundred and twelve, or 
 issued, or to be issued, under the authority of any subsequent act or acts of 
 Congress, authorizing or which shall authorize treasury notes to be issued, 
 previously to the final closing of the subscriptions to the said bank. And the 
 said payment shall be made and completed in the sums, and at the times 
 hereinafter declared; that is to say: at the time of subscribing, there shall be 
 paid twenty-two dollars and fifty cents on each share, in gold or silver coin, 
 forty dollars in the treasury notes, aforesaid, and one hundred and thirty- 
 seven dollars and fifty cents in the public debt of the United States, contract- 
 ed, or to be contracted, as aforesaid. At the expiration of four calendar 
 months, after the time of subscribing, there shall be paid the further sum of 
 twenty dollars, on each share, in gold or silver coin, thirty dollars in the 
 treasury notes aforesaid, and one hundred dollars in the public debt of the 
 United States, contracted, or to be contracted, as aforesaid. At the expira- 
 tion of six calendar months from the time of subscribing, there shall be paid 
 the further sum of twenty dollar*, in goldor silver coin, thirty dollars in the 
 treasury notes, aforesaid, and one hundred dollars in the public debt of the 
 United States, contracted, or to be contracted, as aforesaid. And the sub- 
 scriptions, in public Stock and treasury notes, as aforesaid, shall be taken and 
 credited for the principal and so much of the interest thereof, respectively, 
 as shall have accrued on the day of subscribing the same. And, at the time 
 of subscribing to the capital stock of the said bank, as aforesaid, each and 
 every subscriber shall deliver to the commissioners, at the place of subscrib- 
 ing, as well the specie amount of their subscriptions, respectively, as the cer- 
 tificates of stock for the stock proportion of their subscriptions, respectively, 
 together with a power of attorney authorizing the said commissioners, or a 
 majority of them, to transfer the said stock, in due form of law, to " The 
 President, Directors, and Company, of the said Bank of the United States of 
 America," as soon as the said bank shall be organized, and, also, treasury 
 notes for the proportion of the subscriptions, respectively, payable in treasury 
 notes, as aforesaid: Provided always, That if, in consequence of the appor- 
 tionment of shares, in the said bank, among the subscribers, in the case and 
 in the manner hereinbefore prescribed, any subscriber shall have delivered to 
 the commissioners, at the tune of subscribing, a greater amount of specie, 
 stock, and treasury notes, than shall be necessary to complete the payments 
 for the share, or snares, to such subscriber, apportioned as aforesaid; the 
 commissioners shall only retain so much of the said money, stock, and trea- 
 sury notes, as shall be necessary to complete such payments, and shall, forth- 
 with, return, on application for the same, the surplus thereof to the subscri- 
 ber lawfully entitled thereto. And the commissioners, respectively, shall 
 deposite the gold and silver, certificates of stock, and treasury notes, by 
 them, respectively, received, as aforesaid, from the subscribers to the said 
 bank, in some place of secure and safe keeping, so that the same may, and 
 shall, be specifically delivered and transferred, as the same were, by them, 
 respectively, received, to the said President, Directors, and Company, of the 
 said Bank of the United States of America, or to their order, as soon as shall 
 be required after the organization of the said bank. 
 
 SEC. 3. tfnd be it further enacted* That, at the opening of the subscriptions 
 to the capital stock of the Bank of the United States of America, the Secre- 
 tary of the Treasury shall subscribe, or cause to be subscribed, on behalf of 
 the United States, to the said capital stock of the said bank, the amount of 
 ten millions of dollars, to be paid in public stock, bearing an interest of four 
 per cent, per annum, from the time of subscribing the same, and redeemable 
 in any sums, and at any periods, which the Government may deem fit; and 
 the certificates of such public stock, the Secretary of the Treasurv shall cause 
 to be prepared and made in the usual form, and shall pay and deliver the 
 same to the President and Directors of the said bank, at the expiration of 
 
542 BANK OF THE UNITED STATES. 
 
 three calendar months after the time of opening the said subscription to the 
 capital stock of the said bank, as aforesaid. 
 
 SEC. 4. And be it further enacted, That whenever and as often as any of 
 the treasury notes, subscribed as aforesaid to the said capital stock of the said 
 bank, shall be due and payable, it shall be lawful for the Secretary of the 
 Treasury (and he is hereby authorized and required) to pay and redeem the 
 same, principal and interest, by causing certificates of public stock for an 
 equal amount, bearing an interest of six per cent, per annum, and redeema- 
 ble in any sums, and at any periods, which the Government may deem fit, to 
 be prepared and made in the usual form, and the same to be delivered to the 
 president and directors of the said bank, in satisfaction and discharge of such 
 treasury notes. 
 
 SEC. 5. find be it further enacted, That the subscribers to the said Bank of 
 the United States of America, their succeesors and assigns, shall be, and are 
 hereby created a corporation and body politicly the name and style of " the 
 President, Directors, and Company, of the Bank of the United States of 
 America," and shall so continue until the third day of March, in the year 
 one thousand eight hundred and thirty-five: and by that name shall be, and 
 are hereby made able, and capable in law, to have, purchase receive, possess, 
 enjoy, and retain, to them and their successors, lands, rents, tenements, here- 
 ditaments, goods, chattels, and effects, of whatsoever kinc^ nature, and quality, 
 to an amount not exceeding in the whole fifty-five millions of dollars, includ- 
 ing the amount of the capital stock aforesaid; and the same to sell, grant, 
 demise, alien, or dispose of, to sue and be sued, plead and be impleaded, 
 answer and be answered, defend and be defended, in all courts and places 
 whatsoever; and also to make, have, and use, a common seal, and the same 
 to break, alter, and renew, at their pleasure; and also to ordain, establish, and 
 put in execution, such by-laws and ordinances and regulations, as they shall 
 deem necessary and convenient, for the government of the said corporation, 
 not being contrary to the constitution and laws of the United States: and 
 generally to do and execute all and singular the acts, matters, and things, 
 which to them it shall or may appertain to do; subject, nevertheless, to the 
 rules, regulations, restrictions, limitations, and provisions, hereinafter pre- 
 scribed and declared. 
 
 SEC. 6. Jind be it further enacted That, for the management of the affairs of 
 the said corporation, there shall be twenty-five directors, who shall be elect- 
 ed at the banking house in Philadelphia, on the first Monday of January, in 
 each year, by the stockholders or proprietors of the capital stock of the said 
 corporation, and by a plurality of votes then and there actually given, accord- 
 ing to the scale of voting hereinafter prescribed. And the directors, so 
 duly chosen, shall be capable of serving, by virtue of such choice, until the 
 end or expiration of the first Monday in January next ensuing the time of such 
 election, and no longer: Provided always, That the first election and ap- 
 pointment of directors shall be at the time, and for the period hereinafter de- 
 clared. 
 
 SEC. 7. Jind be it further enacted, That, as soon as the sum of thirteen 
 millions two hundred thousand dollars, in gold and silver coin and in the pub- 
 lic debt and treasury notes, shall have been actually received on account of 
 the subscriptions to the said capital stock, (exclusively of the subscription 
 aforesaid on the part of the United States) notice thereof shall be given by 
 the persons under whose superintendence the subscriptions shall have been 
 made at Philadelphia, in at least two public newspapers, printed in each of 
 the places where subscriptions shall have been made; and the said persons 
 shall, at the same time, and in like manner, notify a time and place, within the 
 said city of Philadelphia, at the distance of at least twenty days from the time 
 of such notification, for proceeding to the election of directors as afosesaid; 
 and it shall be lawful for such election to be then and there made. And the 
 persons who shall be then and there chosen as aforesaid, shall be the first 
 directors, and shall proceed to elect one of their number president of the said 
 corporation, and they shall be capable of serving, by virtue of such choice, un 
 
PROCEEDINGS OF 1814. 545 
 
 til the end and expiration of the first Monday of January next ensuing the 
 time of making the same, and shall forthwith, thereafter, commence the opera- 
 tions of the said bank, at the said city of Philadelphia: Provided always, 
 That, in case it should, at any time, happen that an election of directors and 
 president of the said corporation should not be made upon any day when, in 
 pursuance of this act, they ought to be made, the said corporation shall not 
 tor that cause be deemed to be dissolved; but it shall be lawful on any other 
 day to hold and make an election of directors and president of the said cor- 
 poration, (as the case may be) in such manner as shall have been regulated by 
 the by-laws and ordinances of the said corporation; and until such election be 
 so made, the directors and president, for the time being, shall continue in 
 office: And provided, also, That, in case of the death, resignation, or removal, 
 of the president of the said corporation, the directors shall proceed to elect 
 another president: And provided, also, That, in case of the death, resignation, 
 or absence from the United States, or removal of a director from office, the 
 vacancy shall be supplied by the stockholders. 
 
 SEC. 8. And be it further enacted, That the directors, for the time being, 
 shall have power to appoint such officers, clerks, and servants under them, as 
 shall be necessary for executing the business of the said corporation, and to al- 
 low them such compensation for their services, respectively, as shall be reasona- 
 ble: and shall be capable of exercising such other powers and authorities, for the 
 well governing and ordering of the aftairs of the said corporation, as shall 
 be prescribed, fixed, and determined, by the laws, regulations, and ordinan- 
 ces of the same. 
 
 SEC. 9. And be it further enacted, That the following rules, restrictions, 
 limitations, and provisions, shall form, and be fundamental articles of the con- 
 stitution of said corporation, to wit: 
 
 1. The number of votes to which the stockholders shall be entitled, in vot- 
 ing for directors, shall be according to the number of shares he, she, or they, 
 respectively, shall hold, in the proportions following, that is to say: for one 
 share and not more than two shares, one vote; for every two shares above 
 two and not exceeding ten, one vote; for every four shares above ten, 
 and not exceeding thirty, one vote; for every six shares above thirty, and not 
 exceeding sixty, one vote; for every eight shares above sixty, and not exceed- 
 ing one hundred, one vote; and for every ten shares above one hundred, one 
 vote. But, no person, copartnership, or body politic, shall be entitled to a 
 greater number than thirty votes; and after the first election, no share, or 
 shares, shall confer a right of voting, which shall not have been holden three 
 calendar months previous to the day of election. And stockholders, actually 
 resident within the United States, and none other, may vote in elections by 
 proxy. 
 
 2. Not more than three-fourths of the directors in office, at the time of an 
 annual election, shall be elected for the next succeeding year, and no person 
 shall be a director more than two out of four years; but the director who 
 shall be the president at the time of an election, may always be re-elected. 
 
 3. None but a resident citizen of the United States, and holding, at the 
 time of his election, not less than ten shares, bona fide in his own right, shall 
 be a director; and, if any director shall cease to be a stockholder to that a - 
 mount, he shall cease to be a director. 
 
 4. No director shall be entitled to any emolument. The stockholders may 
 make such compensation to the president, for his extraordinary attendance at 
 the bank, as shall appear to them reasonable. 
 
 i 5. Not less than seven directors shall constitute a board for the transaction 
 of business, of whom the president shall always be one, except in case of sick- 
 ness, or neceaaary absence, in which case his place may be supplied by any 
 other director whom he, by writing under his hand, shall depute for the pur- 
 pose. And the director, so deputed, may do and transact all the necessary 
 business betonging to the office of the president of the said corporation, dur- 
 ing the contmuanceof the sickness, or necessary absence of the president. 
 6. A number of stockholders, not less than sixty, who, together, shall be 
 
544 BANK OF THE UNITED STATES. 
 
 proprietors of one thousand shares or upwards, shall have power ? at any time, 
 to call a general meeting of the stockholders, for purposes relative to the in- 
 stitution, giving at least ten weeks' notice, in two public newspapers of the 
 place where the bank is seated, and specifying in such notice the object or ob- 
 jects of such meeting. 
 
 7. Every cashier, or treasurer, before he enters upon the duties of his office, 
 shall be required to give bond, with two or more sureties, to the satisfaction of 
 the directors, in a sum not less than fifty thousand dollars, with a condition 
 for his good behavior, and the faithful performance t>f his duties to the corpo- 
 ration.^ 
 
 8. The lands, tenements, and hereditaments, which it shall be lawful for 
 the said corporation to hold, shall be only such as shall be requisite for its im- 
 mediate accommodation, in relation to the convenient transacting of its busi- 
 ness, and such as shall have been bona fide mortgaged to it by way of security, 
 or conveyed to it in satisfaction of debts previously contracted in the course 
 of its dealings, or purchased at sales, upon judgments which shall have been 
 obtained for such debts. 
 
 9. The total amount of debts which the said corporation shall at any time 
 owe, whether by bond, bill, note, or other contract, over and above the debt, 
 or debts, due for money deposited in the bank, shall not exceed the sum of 
 fifty millions of dollars, unless the contracting of any greater debt shall have 
 been previously authorized by a law of the United States. In case of excess, 
 the directors under whose administration it shall happen, shall be liable for 
 the same, in their natural and private capacities; and an action of debt may 
 in such case be brought againt them, or any of them, their, or any of their 
 heirs, executors, or administrators, in any court of record of the United 
 States, or either of them, by any creditor, or creditors, of the said corporation, 
 and may be prosecuted to judgment and execution, any condition, covenant, 
 or agreement, to the contrary notwithstanding. But, this provision shall not 
 be construed to exempt the said corporation, or the lands, tenements, goods, 
 or chattels of the same, from being also liable for, and chargeable with, the 
 said excess. Such of the said directors who may have been absent when the 
 said excess was contracted, or created, or who may have dissented from the 
 resolution or act, whereby the same was contracted, or created, may respect- 
 ively exonerate themselves from being so liable, by forthwith giving notice of 
 the fact, and of their absence or dissent, to the President of the United States, 
 and to the stockholders, at a general meeting, which they shall have power to 
 call for that jmrpose. 
 
 10. The said corporation shall not, directly nor indirectly, deal or trade in 
 any thing except bills of exchange, gold or silver bullion, or in the sale of goods, 
 really and truly pledged for money lent, and not redeemed in due time, or 
 goods which shall be the proceeds of its lands. It shall not be at liberty to 
 purchase any public debt whatsoever; nor shall it take more than at the rate of 
 six per cent, per annum, for or upon its loans or discounts. 
 
 11. The said coporation shall not. during the continuance of the present 
 war between the United States and Great Britain, sell any portion of the 
 public debt, constituingapart of its capital stock aforesaid; nor, after the war, 
 at a price less than its par value; nor at any time, to an amount exceeding one 
 moiety of the public debt so constituting a part of its capital stock, without the 
 consent of Congress. 
 
 12. No loan shall be made by the said corporation, for the use or on account 
 of the Government of the United States, to an amount exceeding five hundred 
 thousand dollars, or of any particular State, to an amount exceeding fifty 
 thousand dollars, or of any foreign prince, or state, unless previously autho- 
 rized by a law of the United States. But the said corporation shall be bound 
 to lend to the Government of the United States, reimbursable at their plea- 
 sure, thirty millions of dollars, at an interest not exceeding six per centum 
 per annum, in such sums, and at such periods, as maybe made convenient to 
 the Government of the United States, whenever any law or laws of the Unit- 
 ed States shall authorize and require such loan or loans. 
 
PROCEEDINGS OF 1814. 545 
 
 13. The stock of the said corporation shall be assignable, and transferable, 
 according to such rules as shall be instituted in that behalf, by the laws and 
 ordinances of the same. 
 
 14. The bills obligatory and of credit, under the seal of the said corpora- 
 tion, which shall be made to any person or persons shall be assignable by en- 
 dorsement thereupon, under the hand or hands of such person or persons, 
 and his, lier, or their executors or administrators, and ot his, her, or their as- 
 signee or assignees, and the executors or administrators of such assignee or 
 assignees, and so as absolutely to transfer and vest the property thereof, in each 
 and every assignee or assignees successively, and to enable such assignee or 
 assignees, and his, her, or their executors or administrator*, to maintain an 
 action thereupon in his, her, or their own name or names. And the bills or 
 notes which may be issued by order of the said corporation, signed by the 
 president, and countersigned by the principal cashier, or treasurer thereof, 
 promising the payment ot money to any person or persons, his, her, or their or- 
 der, or to bearer, although not under the seal of the said corporation, shall be 
 binding and obligatory upon the same, in the like manner, and with the like 
 force and effect, as upon any private person or persons, if issued by him, her. 
 or them, in his, her, or their private or natural capacity or capacities, ana 
 shall be assignable and negotiable in like manner as if they were so issued by 
 such private person or persons, that is to say: those which shall be payable 
 to any person or persons, his, her, or their order, shall be assignable bv en- 
 dorsement, in like manner, and witli the like effect, as foreign bins of exchange 
 now are, and those which are payable to bearer, shall be assignable and nego- 
 tiable by delivery only. 
 
 15. Half yearly dividends shall be made of so much of the profits of the 
 bank as shall appear to the directors advisable; and once in every three years, 
 the directors shall lay before the stockholders, at a general meeting, for their 
 information, an exact and particular statement of the debts which shall have 
 remained unpaid after the expiration of the original credit, for a period of 
 treble the term of that credit, and of the surplus of profits, if any, after de- 
 ducting losses and dividends. If there shall be a failure in the payment of 
 any part of any sum subscribed by any person, copartnership, or body politic, 
 the party failing shall lose the benefit of any dividend which may have ac- 
 crued prior to the time for making such payment, and during the delay of the 
 same. 
 
 16. The directors of said corporation shall be bound to establish a compe- 
 tent office of discount and deposite in the District of Columbia, whenever any 
 law of the United States shall require such establishment, and it shall be law- 
 ful for the said directors to establish offices wheresoever they shall think fit, 
 \yithin the United States, for the purposes of discount, deposite, and distribu- 
 tion, or for the purposes of deposite and distribution only; and upon the same 
 terms, and in the same manner, as shall be practised at the bank; and to com- 
 mit the management of the said offices, and the business thereof, respectively, 
 to such persons, and under such regulations, as they shall deem proper, not 
 being contrary to law or the constitution of the bank. Or, instead of esta- 
 blishing such offices, it shall be lawful for the directors of the said corpora- 
 tion, from time to time, to employ any other bank or banks, at any place or 
 places, that they may deem safe and proper, to manage and transact the bu- 
 siness proposed as aforesaid, to be managed and transacted by such offices, 
 under such agreements, and subject to such regulations, as they shall deem 
 just and proper. But the managers or directors of every office of discount, 
 deposite, and distribution, established as aforesaid, shall be annually appoint- 
 ed by the directors of the bank, to serve one year; each "of {them shall be a 
 citizen of the United States, and shall hold, at the time of his appointment, 
 not less than five shares in the said bank, bona fide in his own right; and if 
 he shall cease to be a stockholder to that amount, he shall cease to be a man- 
 ager or director of such office of discount, deposite, and distribution; and not 
 more than three-fourths of the said managers or directors in office at the time 
 of an annual appointment, shall be reappointed for the next succeeding year; 
 
 69 
 
546 BANK OF THE UNITED STATES. 
 
 nor shall any person be a manager or director for more than two out of four 
 years, ^but the president may be always reappointed. 
 
 17. The said corporation, all offices of discount, deposite, and distribution, 
 and of deposite and distribution only, which shall be established by the said 
 directors as aforesaid, and all banks by the said directors employed, in lieu 
 of such offices as aforesaid, shall be bound to receive, upon deposite, the trea- 
 sury notes of the United States, which have been or may be hereafter issued.. 
 by virtue of any law or laws of the United States. But it shall be optional 
 with the said corporation to pay and discharge the checks or drafts of the 
 persons making such deposite in treasury notes, for the amount thereof, either 
 in gold or silver eoin, or in the notes of the bank, or in treasury notes. And 
 all banks by the said directors employed as aforesaid, in lieu of the offices 
 aforesaid, shall be further bound to receive, on deposite, and to circulate the 
 notes of the said corporation on the same terms, and in the same manner, as 
 the notes of the said banks respectively are received and circulated; and, from 
 time to time, to issue and exchange for the said notes of the said corporation, 
 other notes of the said corporation, or the notes of the said banks, respectively, 
 or treasury notes, at the option of the person applying for such issue or 
 exchange, 
 
 18. During the continuance of the present war between the United States 
 and Great Britain, all the notes of the said corporation, whether payable at 
 the seat of the bank in Philadelphia, or elsewhere, shall be payable in other 
 notes of the said corporation, in treasury notes, or in gold and silver coin, at 
 the bank in the city of Philadelphia only, at the option of the applicant. At 
 all the offices of discount, deposite, and distribution, and of deposite and dis- 
 tribution only, and at all the banks employed in lieu of such offices, the notes 
 of the said corporation, during the continuance of the said war, shall be pay- 
 able in other notes of the said corporation, or in treasury notes only. And the 
 said corporation shall, at all times, distribute among the offices and banks afore- 
 said, a sufficient sum in the various denominations of the notes of the said cor- 
 poration, and in treasury notes, to answer the demand therefor, and to establish 
 a sufficient circulating medium throughout the United States and the territories 
 thereof; and the treasury notes to be distributed and circulated, the Secretary 
 of the Treasury shall cause to be delivered, from time to time, to the said bank 
 in Philadelphia; and the same shall be distributed and circulated by the said 
 bank, under directions, in that behalf, given by the said Secretary. 
 
 19. The officer at the head of the Treasury Department of the United 
 States shall be furnished, from time" to time, as often as he may require, not 
 exceeding once a week, with statements of the amount of the capital stock of the 
 said corporation, and of the debts due to the same: of the moneys deposited 
 therein; of the notes in circulation; and of the cash in hand; and shall have a 
 right to inspect such general accounts in the books of the bank as shall relate 
 to the said statement: Provided, That this shall not be construed to imply a 
 right of inspecting the account of any private individual or individuals with 
 the bank, 
 
 SEC. 10. Jind be it further enaded, That, if the said corporation, or any 
 person or persons for or to the use of the same, shall deal or trade in buying 
 or selling any goods, wares, merchandise, or commodities, whatsoever, con- 
 trary to the provisions of this act, all and every person and persons by whom 
 any order or direction for so dealing or trading shall have been given, and alt 
 and every person and persons who shall have been concerned as parties or 
 agents therein, shall forfeit and lose treble the value of the goods, wares, mer- 
 chandises, ami commodities, in which such dealing and trade shall have beenf 
 one-half thereof to the use of the informer, and the other half thereof to the 
 use of the United States, to be recovered in any action at law with costs of 
 suit. 
 
 SEC. 11. Jindbe it further enacted, That, if the said corporation shall ad- 
 vance or lend any sum of money for the use, or on account, of the Government 
 of the United States, to an amount exceeding five hundred thousand dollars, 
 or of any particular State, to an amount exceeding fifty thousand dollars, or of 
 
PROCEEDINGS OF 1814. 547 
 
 any foreign Prince or State, (unless previously authorized thereto by a law of 
 the United States) all and every person and persons, by, and with whose order, 
 agreement, consent, approbation, and connivance, such unlawful advance or 
 loan shall have been made, upon conviction thereof, shall forfeit, and pay for 
 every such offence treble the value or amount of the sum or sums which shall 
 have been so unlawfully advanced or lent; one-fifth thereof to the use of the 
 informer, and the residue thereof to the use of the United States. 
 
 SEC. 12. And be it further enacted, That the bills or notes of the said cor- 
 poration, originally made payable, or which shall have become payable, on 
 demand, during the continuance of the present war between the United States 
 and Great Britain, in gold and silver coin, at the seat of the bank in Phila- 
 delphia, and which, during the continuance of the said war, are made payable 
 elsewhere, on demand, in other notes of the said corporation, or in treasury 
 notes as aforesaid, and which, after the termination of the said war, shall be 
 made generally payable on demand, in gold or silver coin, shall be receivable 
 in all payments to the United States. 
 
 SEC. 13. And be it further enacted, That if, during the continuance of the 
 present war between the United States and^ Great Britain, and a period of one 
 year after the termination of the said war, demands shall, at any time or times, 
 
 United States, so as greatly to diminish or endanger the specie capital of the 
 Government and country, as well as of the said corporation; or that the said 
 gold and silver coin is intended to be wilfully withdrawn from circulation, so 
 as greatly to embarrass, obstruct, and discredit the pecuniary transactions of 
 the People and the Government, as well as of the said corporation; or that the 
 said gold and silver coin is demanded, in consequence of a wilful and sinister 
 accumulation of the bills and notes of the said corporation, with the intention 
 to impair or destroy the credit of the said corporation; then, and in every such 
 case, and as often as such cases shall occur, it shall be lawful for the directors 
 of the said corporation, to suspend its payments in specie, and their duty forth- 
 with, to represent the same to the President of the United States. And it 
 shall be thereupon lawful for the President of the United States to direct the 
 said corporation to resume, or to continue to suspend^ its payments in specie, 
 for such time as he shall deem expedient; and the said corporation shall re- 
 sume, or continue to suspend, its payments in specie, according to such di- 
 rections. And the President of the United States shall cause a statement of 
 the proceedings, in all such cases, to be laid before Congress, if in session, im- 
 mediately; if not in session, then within ten days after the next meeting of 
 Congress; and such suspension may continue until removed by Congress, ot 
 by the President. 
 
 SEC. 14. And be it further enacted, That, during the continuance of this 
 act, and whenever required by the Secretary of the Treasury, the said cor- 
 poration shall do and perform the several and respective duties of the com- 
 missioners of loans for the several States, or of any one or more of them, at the 
 times, in the manner, and upon the terms, to be prescribed by the Secretary of 
 the Treasury. 
 
 SEC. 15. And be it further enacted, That no other bunk shall be established 
 by any future law of the United States, during the continuance of the cor- 
 poration hereby created; for which the faith of the United States is hereby 
 pledged: Provided, Congress may renew existing charters for banks in the 
 District of Columbia, not increasing the capital thereof; and may grant char- 
 ters, if they deem it expedient, to any banking associations now in operation 
 in the said District, and renew the same, not increasing the capital thereof. 
 And, notwithstanding the expiration of the term for which the said corpora- 
 tion is created, it shall be lawful to use the corporate name, style, and capa- 
 city, 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 noffor any other purpose, or in 
 
548 BANK OF THE UNITED STATES. 
 
 any other manner whatsoever; nor for a period exceeding two years after the 
 expiration of the said term of incorporation. 
 
 DECEMBER 5, 1814. 
 
 The bill was read a second time, and considered by the Senate as in com- 
 mittee of the whole. 
 
 Mr. MASON moved to strike out, from the first section, the word <fc fifty," 
 and insert "twenty," in lieu thereof, thereby reducing the proposed amount 
 of the capital stock from fifty to twenty millions of dollars; which motion was 
 debated on this and the two following days; and, on the 7th, 
 
 The question was taken on Mr. MASON'S motion, and decided as follows: 
 Yeas, 13; Na,vs, 18. 
 
 Those who voted in the affirmative, were, 
 
 Messrs. Brown, Daggett, Dana, Fromentin, German, Goldsborough, Gore, Horsey, 
 Hunter, King, Lambert, Mason, Thompson. 
 
 Those who voted in the negative, were, 
 
 Messrs. Anderson, Bibb, Bledsoe, Brent, Chase, Condit, Gaillard, Lacock, Mor- 
 row, Roberts, Robinson, Smith, Tait, Taylor, Turner, Varnum, Walker, Wharton. . 
 
 So the motion was lost. 
 
 The bill proposed that subscriptions be forthwith opened for forty millions 
 of the capital stock. 
 
 Mr. MASON moved to strike out " forty," and insert " thirty," in lieu there- 
 of; and, 
 
 A division of the question being required by Mr. DANA, 
 
 The question on striking out the word " forty" was negatived, by precisely 
 the same vote as that just recorded. 
 
 After making further progress in the bill, the Senate adjourned. 
 
 DECEMBER 8, 1814. 
 
 On motion by Mr. KING, to strike out of section second, after the word 
 " States," the following words: "or in the public debt of the United States, 
 contracted by virtue of the act of Congress, entitled 'An act authorizing a 
 loan for a sum not exceeding eleven millions of dollars,' passed the 14th day 
 of March, 1812, or contracted, or to be contracted, by any subsequent act and 
 acts of Congress, heretofore passed, authorizing a loan or loans," and insert 
 in lieu thereof, "or in any public debt of the United States, bearing, at the 
 time of payment, an interest of six per centum annually;" 
 
 It was determined in the negative: Ayes, 11; Noes, 19. 
 
 On motion by Mr. FROMENTIN. to strike out of the second section, line 
 twenty seven, after the word "paid," the word "twenty," and insert, in lieu 
 thereof, the word " sixty," it was, by a vote of ten to nineteen, determined 
 in the negative. 
 
 On motion by Mr. KING, to add a new section to the bill, as follows: 
 
 "SEC. 16. Jlnd be it further enacted, That, if the said corporation shall do, 
 or cause or permit to be done, or transacted, on its behalf, or for its use, any 
 matter or thing injurious to the public welfare, and not authorized by this act, 
 or shall neglect to do any matter or thing, which it shall be the duty of the 
 said corporation to do, it shall, in each anil every such case, be competent and 
 lawful for Congress to repeal so much of this act as allows the notes of this 
 corporation to be received in payment to the United States;" 
 
 It was determined in the negative: Yeas 13, Nays 18. 
 
 On motion by Mr. GERMAN, to add a new section to the bill, as follows: 
 
 "And be it further enacted. That Congress may repeal so much of this act 
 as relates to the payment of the public revenue in the bills of the said bank;" 
 
PROCEEDINGS OF 1814. 549 
 
 It was determined in the negative: Yeas 10, Nays 21. 
 
 And the bill was reported to the House amended. 
 
 On the question, " Shall the bill be engrossed and read a third time, as 
 
 It was determined in the affirmative, as follows: Yeas 18; Nays 13. 
 
 Those who voted in the affirmative, were, 
 
 Messrs. Anderson, Bibb, Bledsoe, Brent, Chase, Condit, Gaillard, Lacock, Morrow, 
 Roberts, Robinson, Smith, Tait, Taylor, Turner, Varnum, Walker, Wharton. 
 
 Those who voted in the negative, were, 
 
 Messrs. Brown, Daggett, Dana, Fromentin, German, Goldsborough, Gore, Horsey, 
 Hunter, King-, Lambert, Mason, Thompson. 
 
 DECEMBER 9, 1814. 
 
 The question, " Shall the bill pass?" was decided by the following vote: 
 Yeas 17; Nays 14. 
 
 Those who voted in the affirmative, were, 
 
 Messrs. Anderson, Bibb, Bledsoe, Brent, Chase, Condit, Lacock, Morrow, Roberts, 
 Robinson, Smith, Tait, Taylor, Turner, Varnum, Walker, Wharton. 
 
 Those who voted in the negative, were, 
 
 Messrs. Brown, Dag-gett, Dana, Fromentin, Gaillard, German, Goldsborough, Gore, 
 Horsey, Hunter, King, Lambert, Mason, Thompson. 
 
 So the bill was passed, and sent to the House of Representatives for con- 
 currence. 
 
 HOUSE OF REPRESENTATIVES. 
 
 DECEMBER 9, 1814. 
 
 The bill from the Senate was received, and on the following day referred to 
 the Committee of Ways and Means. 
 
 DECEMBER 14, 1814. 
 
 Mr. FISK, of New York, from the Committee of Ways and Means, reported 
 a number of amendments to the bill from the Senate, "to incorporate the sub- 
 scribers to the Bank of the United States of America:" which were read, and, 
 with the bill, referred to a committee of the whole. 
 
 DECEMBER 23, 1814. 
 
 On motion of Mr. FISK, of New York, the House resolved itself into a com- 
 mittee of the whole, Mr. MACOX in the chair, on the bill. 
 
 The first section contains the leading principles of the bill, substantially as 
 follows: The capital to consist of fifty millions of dollars, to be divided into 
 an hundred thousand shares, of five hundred dollars each; subscriptions for 
 forty millions whereof to be opened on the third Monday of January next, at 
 Boston, New York, Philadelphia, Richmond, Charleston, and Pittsburg. 
 [The amendments proposed to this section, by the Committee of Ways and 
 Means, contemplate an extension of the number of places of subscription, &c.] 
 Betore the question was stated on these amendments, 
 
 Mr. CLOPTOX, of Virginia, moved to strike out the first section of the bill, 
 and said: I have made this motion, Mr. Chairman, at this stage of the dis- 
 cussion, as being at the most proper time to try the general principle of the 
 bill, because I cannot, under my present convictions, vote for this or any 
 other bill to establish a bank, and therefore wish to state to this committee 
 the ground of constitutional objection which I have to it. The objection is 
 not one which admits a right to legislate on the subject proposed, but would 
 prescribe the precise extent to which it might be exercised, and beyond which 
 
550 BANK OF THE UNITED STATES. 
 
 it ought not to be exercised ; but it is an objection grounded on a thorougli be- 
 lief, the result of deliberate examination of the constitution, and reflection 
 thereon, that there does not exist in this body any manner of right to legislate 
 on the subject at all; that no sort of authority to do so is vested in it, either 
 by express grant, or as incidental to any express grant. 
 
 I should, indeed, have been glad it some gentleman who patronizes this 
 scheme, would have presented to us his views of the authority which he con- 
 ceives the constitution has given to pass such a bill as this, that if I had been 
 convinced of having been heretofore in error, I might have been left free to 
 decide upon the measure accordingly as it should appear to be expedient or 
 otherwise: but no gentleman having done so, in the course of a long discus- 
 sion of the bill on the same subject, which was before this body some time 
 ago, when I was in a very low state of health; and expecting that the same si- 
 lence, in that respect, will be observed upon this bill, I am left to presume al- 
 together as to the ground on which the friends of the scheme rest for their 
 authority; and, being left so to presume, I cannot conceive of any part of the 
 constitution on which they can rely for authority, other than the concluding 
 clause of the eighth section of the first article of the constitution, commonly 
 called the sweeping clause, in the following words: " To make all laws which 
 shall be necessary and proper for carrying into execution the foregoing powers," 
 &c.: because there is no other part of the constitution, that I know of, which 
 can afford even a shadow of pretext for exercising such a power as is now pro- 
 posed to be exercised by the bill before you: because, upon every occasion 
 which has heretofore occurred, when a right has been claimed to exercise a 
 distinct power or powers, not expressly granted, for the avowed purpose of 
 carrying into execution other powers that are so granted, that clause has been 
 always resorted to; and more especially, because the Secretary of the Trea- 
 sury, the original parent of this scheme, in his letter to the chairman of the 
 Committee of Ways and Means, of the 17th of October last, after modestly 
 suggesting the propriety of a change of opinion respecting the constitution, to 
 suit the "difference of times and circumstances," wound up his recommenda- 
 tion of the scheme with a declaration of his " opinion, that, in these times, it 
 will not only be useful in promoting the general welfare, but that it is neces- 
 sary and proper for carrying into execution some of the most important powers 
 constitutionally vested in the Government;" thus using the most operative 
 words of that clause, the words " necessary and proper for carrying into ex- 
 ecution," &c., and evidently thereby inviting the attention of the members of 
 this body to the clause, as being of singular importance in guiding their deli- 
 berations on this subject. 
 
 It would seem, sir, nevertheless, that even in the mind of the Secretary 
 himself, there existed at least some doubt whether a power to establish the 
 proposed bank is z/se/f constitutionally vested in Congress, for he does not say 
 that it is, but only, that, in his opinion, "the establishment of a national bank 
 is necessary and proper for carrying into execution" some powers that are 
 constitutionally vested in the Government, as if he intended to confine the 
 actual constitutional investiture to powers expressly granted. If he did in- 
 tend so to confine it, he was thus far correct; for no power whatever is con- 
 stitutionally vested in this body that is not expressly granted to it. 
 
 Let the opinion of the Secretary on this point be what it may, his letter will 
 not, cannot, induce me to participate in the exercise of a power which, I ve- 
 rily believe, is not. in any manner whatever, vested in this body. Even if the 
 measure proposed should seem ever so expedient, which, however, is far from 
 appearing to me to be the case with respect to the proposed institution; but, 
 on the contrary, should it be established, I fear it may ultimately turn out to 
 be a dangerous, a very dangerous political machine to this country, even if 
 some temporary advantages should be derived from it; if some of the difficul- 
 ties under which the Government is said to labor, should, for the present, be 
 obviated difficulties, I am constrained to say, which might have been pre- 
 vented by timely provisions, by other means not in any way conflicting with 
 the constitution, which might have precluded that great necessity, as it is re- 
 
PROCEEDINGS OF 1814. 
 
 presented to be, and now spoken of by some gentlemen, as, in their opinion, so 
 imperiously calling lor such an institution as the one proposed. But, sir, I 
 am not prepared, nor am I willing, to admit that the Government is in such a 
 desperate situation as to render the proposed bank necessary for its relief or 
 accommodation, even if the right to establish the institution was unquestion- 
 able. I deny that such necessity does exist. On this occasion, therefore, as 
 on others, I take the liberty to decide according to the dictates of my own 
 judgment. If, in this instance, I judge upon mere visionary speculation, in 
 respect to the constitution, let the observations I am about to offer to the com- 
 mittee determine. 
 
 In tracing the features of the federal constitution, Mr. Chairman, I have 
 always found that they present themselves to my mind as being rooted in one 
 great fundamental principle, which is, that all the powers at the command of 
 this Government are those only which are delegated to it. This principle is 
 expressly recognised by an amendment to the constitution, adopted at a very 
 early period after the constitution was carried into operation. The term 
 "delegated," as used in that amendment, I consider to be a peculiar phrase 
 of special, distinct, definite meaning, and when applied to any particular 
 power, not fairly susceptible of implication or involution of any distinct power, 
 other than the power to which it is immediately and directly applied. In 
 other words, sir, I understand the term to mean that the powers "delegated," 
 are those only which are specifically designated by express grants. The de- 
 legation of me powers of this Government comprehends, then, no more than 
 what are distinctly expressed in the delegation or series of positive grants. 
 
 A sort of powers, however, has been much and often spoken of, the true 
 nature and extent of which, perhaps, have not been always distinctly and 
 clearly understood, if, indeed, the existence of any powers at all, under that 
 denomination, ought to be admitted; I allude to what are called incidental 
 powers. The broadest latitudinarians, in relation to the powers of this body, 
 have never, that I know of, extended their notions of its powers farther than 
 to these two species the powers strictly denominated ** delegated" powers, 
 or powers "expressly granted," and what they call "incidental" powers. 
 This notion of incidental powers, is deduced altogether from the same con- 
 cluding clause of the 8th section of 1st article of the constitution, as being 
 " necessary and proper" for carrying into execution the express powers spe- 
 cified in the preceding clauses of that section; and very much, if not the whole, 
 of the diversity of opinion, which has prevailed in relation to the powers con- 
 stitutionally vested in Congress, has proceeded, perhaps, from the difference 
 between the construction given to that clause by some, and the construction 
 given to it by others. 
 
 According to my understanding of the word " incidental," I take it to be 
 an adjective, not only in point of grammar strictly, but that, if it can properly 
 be applied to any power at all, it can be applied only to a power which is itself 
 but the adjective or adjunct of another power to which it belongs, and has no 
 existence separate from that power. In my opinion, then, what is commonly 
 called incidental powers, are not real, distinct powers, but rather modes of 
 exercising the express powers to which they belong or are incident. Whence, 
 sir, I consider myself perfectly justifiable in the declaration, that the clause 
 in the constitution, which has been mentioned, and by which alone, it is gene- 
 rally thought, the exercise of those supposed incidental powers is authorized, 
 does not embrace any distinct substantive power at all. The power now pro- 
 posed to be exercised, in passing the bill before you, I consider to be a distinct 
 substantive power, as clearly as any power can be, and therefore not embraced 
 in that clause. It is not expressly granted, as must be admitted by every 
 body; whence it is evident to my mind, that it is not, in any manner what- 
 ever, vested in this body, and therefore cannot be constitutionally exercised 
 by this body. 
 
 Firmly, then, as the Secretary of the Treasury, or other advocates of this 
 bill, may conceive the doctrine they entertain in favor of it to be supported 
 by the clause of the constitution which has been mentioned, I must beg leave 
 
552 BANK OF THE UNITED STATES. 
 
 to differ from them entirely in opinion. 1 consider it affording no solid, no 
 substantial support at all to such a doctrine; and never, in my opinion, was 
 an appellation more improperly bestowed upon any thing, than the appellation 
 which has been bestowed upon that clause. On account, then, of the very ex- 
 tensive latitude of construction given to the clause, ascribing to it abundantly 
 more force than it actually possesses, I have been inclined to think that it 
 might have been better, perhaps, if the clause had never been inserted in the 
 constitution; or, at least, that part of it which relates to the several grants of 
 power specified in the preceding clauses of the section. For, so far from 
 sweeping by which, it would seem, is meant (if, indeed, the appellation is 
 designedto mean any thing) a carrying along with it powers not specified in 
 the enumeration of slants immediately preceding the clause it carries along 
 with it nothing at all. It imparts not a scintilla of power to Congress which 
 the preceding enumeration does not grant. If, then, by the ascription to it 
 of the sweeping quality, be really meant that it imparts to Congress powers 
 other than those enumerated in the preceding clauses of the section, which 
 are distinct from, and additional to them, indefinite in number and extent, a 
 little reflection,! should imagine, might convince any one that such construc- 
 tion must involve dangerous consequences that such would be a sweeping 
 quality, indeed that it might sweep away, not only all the restrictions in- 
 tended by the specification of those particular grants of power, but also every 
 vestige of authority reserved to the States. Yes, sir, such must be its quality, 
 such the extent of its force, if it be allowed that the clause conveys to Con- 
 gress any real substantive powers not contained in the special grants enume- 
 rated. For if it be admitted that it conveys any such additional powers at 
 all, since they are not defined, they would consequently be general as well 
 as unlimited. To give to the clause, then, the full force which the appella- 
 tion by which it has been distinguished, were it a proper appellation tor it, 
 would be, in fact, to give to Congress general, unlimited, discretionary powers. 
 I presume, sir, that nothing would be hazarded by the declaration, were I to 
 take upon myself to affirm, that not a single member of this honorable body 
 will admit that it contains a grant of such general, discretionary powers. 
 Hence, sir, it is clear to my mind, that those who ascribe to the clause in 
 cmestion the quality which seems to have been ascribed to it, must be involved 
 in the dilemma of either advocating so great an extent of power as existing in 
 this body, as would render altogether useless and nugatory the special grants 
 of power enumerated in the constitution, and, therefore, much more power 
 than they would really be willing to allow it to convey; or of admitting, at 
 last, that it conveys none at all more than what the enumeration of itself 
 grants without that clause. Hence, too, it is equally clear to me, that, so far 
 from conferring on this body any real powers additional to those described in 
 the preceding enumeration, the clause is merely the recognition of a general 
 principle, necessarily inherent in each grant of power, that Congress, being in- 
 vested with the power > may use, or authorize by law a use of the natural ap- 
 propriate means of carrying the power into execution, for which purpose 
 alone such means can be used, the application of them depending entirely 
 upon the exercise of the power granted, and without which right allthe seve- 
 ral grants expressed, would be merely so many naked grants, and would con- 
 vey to this body no such powers as the grants purport to convey. 
 
 Permit me, sir, to illustrate the position I have now advanced, by a refer- 
 ence to one of the special grants of power enumerated. 1 say one of them, 
 because it would be unnecessary to trouble the committee with any more, al- 
 though observations similar to those about to be made on the one selected, 
 might be made upon all, or nearly all of them, tending equally to establish the 
 truth of the position, but which would require more time than, perhaps, it might 
 be either convenient or agreeable to the committee to be detained; and be- 
 cause it is believed that the observations on one of them, may suffice for my 
 purpose as amply as if I were to trouble the committee with similar remarks 
 on all of them. I will take the first grant, enumerated in these words: "Con- 
 gress shall have power to lay and collect taxes, duties, imposts, and excises," 
 
PROCEEDINGS OF 1814. 553 
 
 &c. To this grant let the clause in question be applied, and the recognition 
 of" the principle I have mentioned, may, I think, be clearly perceived. What 
 is its operation? The words of the grant expressly confer on Congress a spe- 
 cific power to lay and collect taxes, duties, imposts, and excises. Now, sir, 
 does this grant operate no further than merely to authorize Congress to pro- 
 vide, by law, that " taxes, duties," &c., on certain articles, at certain rates, 
 or to certain amounts, shall be laid and collected, and to do no more? To 
 confine its operation to this limit, would be to ascribe no efficient meaning, to 
 give no force at all to the words toy and collect. But they certainly have such 
 meaning they certainly have some force; and. from the operation of the ge- 
 neral principle, such as I have alluded to, which is necessarily inherent in the 
 grant of "power to lay and collect taxes, duties,*' &c., Congress becomes vest- 
 ed with a right to authorize, by law, a use of the natural, appropriate means 
 of causing taxes, duties, &c., to be laid and collected, which, in fact, is no- 
 thing more than an efficient exercise of the simple " power to lay and collect 
 taxes, duties," &c.; such as to authorize, by law, the establishment of custom 
 houses, rules for the entrances and clearances of vessels, the employment of 
 public armed vessels about the mouths of rivers, or other inlets and outlets, 
 and on the coasts, to prevent smuggling and evasions of duties directed by 
 law to be laid on imports, the appointments of collectors, inspectors, and 
 other necessary officers for collection of the revenues arising therefrom, and 
 conveyance of them into the treasury: so also in relation to the system of in- 
 ternal taxation lately established, and now enlarged, as appropriate means of 
 carrying the system into effect, the appointments of a commissioner of that 
 revenue, collectors, assessors, and other necesssary (.officers, and rules of pro- 
 ceeding in every case of taxation, have been all authorized by law, for the 
 purposes of levying the taxes and bringing them into the use of the Govern- 
 ment. 
 
 Now, sir, I beg leave to ask, would not Congress have had a constitutional 
 right to make laws authorizing all the several proceedings I have just noticed, 
 if the clause, which has been cited, had never been inserted at the end of the 
 section which has been mentioned? Can there exist any doubt respecting its 
 authority to have done so? It seems to me that not a shadow of ground for 
 doubting its authority would have existed; but that the words " shall have 
 power to lay and collect taxes, duties, imposts, and excises," convey to this 
 body the same extent of authority as the grant would, if it had been expressed 
 that Congress shall have power to lay and collect taxes, duties, imposts, and 
 excises, by making the necessary and proper laws for laying and collecting 
 them. For a legislature cannot lay and collect taxes, duties, imposts, or ex- 
 cises, but by makmg some law or laws for laying and collecting .them; that is 
 to say, some law or laws appropriate to the purposes of laying and collecting 
 them. 
 
 The " power to lay and collect taxes, duties, imposts, and excises," is the 
 same, then, as a power to make laws which shall be " necessary and" proper" 
 to lay and collect taxes, duties, imposts, and excises. But to make laws 
 which shall be " necessary and proper" to lay and collect taxes, duties, &c., 
 is the same as to make laws which shall be tfc necessary and proper for carry- 
 ing intc execution" the power to lay and collect taxes, duties, &c. Hence, 
 then, a power to make laws which shall be " necessary and proper for cany- 
 ing into execution" the power to lay and collect taxes ? duties, imposts, and 
 excises, is the same as, and can be no more than, the simple power " to lay 
 and collect taxes, duties, imposts, and excises." It is evident, therefore, to 
 my mind, sir, that what have been generally called powers incidental to ex* 
 press powers, are not real, distinct powers, but nothing more than modes of 
 exercising the express powers to which they belong, or using the natural, ap- 
 
 Eropriate means of carrying them into execution, which are the only purposes 
 >r which the means are required, and to which only they can be applied, the 
 objects on which they can operate being those only on which the express 
 powers, to which they respectively belong, are exercised; that nothing more 
 is comprehended within the meaning of the words " to make all laws which 
 70 
 
554 BANK OF THK UNITED STATES. 
 
 shall be necessary and proper for carrying into execution the foregoing powers/* 
 &c. f contained in the clause which has been characterized as the sweeping 
 clause, and to which so extensive a scope has been given. 
 
 Now, Mr. Chairman, if the words tfc to make all laws, which shall be ne- 
 cessary and proper," instead of having been inserted at the end of the sec- 
 tion, had been inserted in the first grant, between the word " power" and the 
 words " to lay and collect taxes, duties," &c. so as to have made the clause read 
 thus: " Congress shall have power to make all laws which shall be necessary 
 and proper to lay and collect taxes, duties," &c. would any gentleman con- 
 tend that Congress, under this grant, so modified, would have a constitutional 
 right to exercise, as the means of laying and collecting taxes, duties, &c., a 
 distinct substantive power, not expressed in the grant, and not necessarily 
 belonging to the power of laying and coil-acting taxes, duties, &c., but which 
 could be exercised independently of the exercise of that power, and operate on 
 objects not at all connected with the exercise of it? Surely not: yet, it is the 
 same thing to contend that those words of the clause, at the end of the section, 
 contain a grant of such power; for, they apply to each special grant of power 
 enumerated in the same manner, and only in the same manner, as if they had 
 been incorporated into the body of each grant, respectively. Nothing can be 
 more clear and evident than that the words so apply, and so only. Neverthe- 
 less, sir, this famous clause has been so construed, and I suppose, still is so con- 
 strued as to give to Congress separate, distinct, and substantive powers, not 
 expressed in the enumeration of grants. Expediency is made the basis of such 
 construction; and, from an opinion entertained by some gentlemen, that the 
 proposed banking institution may afford a useful engine to the Government in its 
 financial arrangements; though the correctness of that opinion is controverted 
 by ethers, and is, upon the whole, extremely problematical: yet, from their 
 opinion merely of its expediency, a right to establish the institution is claim- 
 ed, and now in rapid exercise; although nothing can be more evident, than 
 that, to do so, is to exercise a distinct, substantive power, not contained in the 
 enumeration; a power as distinct and substantive as any of those enumerated 
 are, with respect to the others, on the list. This observation leads me, sir, 
 and, indeed, almost irresistibly impels me, to brine to the notice of the com- 
 mittee, one particular grant of power enumerated, so extremely apt, in my 
 opinion, and well fitted is it for a further illustration of the principles I con- 
 tend for. It is the power " to establish post offices and post roads." 
 
 Here, sir, is a power distinctly expressed in the enumeration,, of so much 
 importance to the Government, in affording ready, convenient, and expedi- 
 tious means of conveyance of intelligence, to and from every department, 
 every branch, and every individual member of every branch and department 
 of the Government, as well as to and from the citizens of the United States 
 at large, as to render it almost absolutely necessary for carrying on the affairs 
 of the Government. Yet, we see this power expressly designated in the enu- 
 meration. "Why do we see it here expressly designated? For this very ob- 
 vious and undeniable reason that it is a power completey substantive in its 
 nature; distinct and separate from, and independent of, all others enumerat- 
 ed. Whence the iramers of the constitution, from a consideration of its 
 great importance to the General Government, and the manifest propriety of 
 vesting it in this Government, took care to insert it in the enumeration of 
 express grants well knowing that it could not, by any possible just construc- 
 tion, be considered as the incident of any of those express grants; and, con- 
 sequently, that, however necessary and proper it might be for carrying on the 
 affairs of the Government, such a power could not be constitutionality exer- 
 cised, unless inserted amongst the express grants. 
 
 Now, Mr. Chairman, 1 will seriously, I will solemnly, address myself to 
 the members of this honorable body, and ask, will any gentleman undertake 
 to say, that the power to establish such an institution as the one now proposed; 
 an institution of such vast moment, involving interests so deep, so extensive, 
 so fathomless, indeed, as almost to baffle the powers of human language 
 to describe them; an institution which, if established, as was said, and justly 
 
PROCEEDINGS OF 1814. 555 
 
 said, by a gentleman from New York, (Mr. OAKLEY) some time ago, in rela- 
 tion to the bill on the same subject, then under discussion, will be likely to 
 wield the destinies of this nation for ages to come? I say, sir, will any gen- 
 tleman undertake to affirm that a power to establish sush a monstrous institu- 
 tion as this, is not a power as completely substantive in its nature, as the 
 power to establish post offices, and to direct that the mails shall be carried on 
 certain roads? Sir, is the sun, shining in his meridian splendor, clearer to 
 the eye, than it must be to every mind, high and low, wise and ignorant, that 
 a power to create so terrific and stupendous an establishment as this, is no 
 less a substantive power, and no less distinct and separate from, and inde- 
 pendent of, all others, whatever, than is the power to establish post offices and 
 post roads? Sir, this is too clear and too plain to need any illustration. It 
 would be but an idle waste of time, indeed, to trouble the committee with any 
 observations upon it, with a view of attempting to prove more clearly that it 
 is such a power; and, if gentlemen are determined to assume the power, the 
 exercise of it will be totally unconnected with that of any of the express 
 povyers enumerated in the constitution, and its operation is independent of 
 their operation, as the power itself is independent of all those express pow- 
 ers. These are the characteristic properties of a distinct, substantive power. 
 Strange, I think, must be the construction, then, which interprets it to be a 
 power merely incidental to either of those express powers, and, since it is not 
 itself one of them, my impressions are irresistible, that it is not in any man- 
 ner vested in this body, and therefore cannot be constitutionally exercised 
 by it. 
 
 Sir, if the doctrine, under which this power is assumed and exercised, 
 should be generally tolerated and sanctioned; if this vast unlimited latitude 
 of construction should become the established construction of the clause in the 
 constitution, which has been so often referred to, what will become of the great 
 land marks of the constitution? Will they not, in effect, be all levelled with 
 the ground? Will not the wide unbounded ocean of human affairs be then 
 laid open to this restricted Federal Legislature, (as every body, who pretends 
 to know any thing of the principles of the constitution, acknowledges it to be} 
 to select from them such subjects as it may choose, as bases of its lawsr 
 Surely, sir, it will. All the restrictions contained in the constitution, which 
 have been marked out by the specification of particular powers, as limitations 
 to Congress, in legislating for these United States, will be swept away will 
 be annihilated; and there will be nothing to hinder a course of legislation 
 from being pursued without restraint, without any limitation, whatever, but 
 its own discretion, as to what it may determine upon as necessary or proper 
 to be done. Sir, can a single object fall within the compass of the human 
 imagination, which may not be also drawn within the scope of this boundless 
 construction, and, according to it, be deemed a legitimate subject of congres- 
 sional legislation? Not one, sir. Every possible object of human legislation, 
 not palpably repugnant to the first principles of our nature, of which the mind 
 can conceive, under this very extensive construction, may as well, and as 
 rightfully, form a basis of legislation for this body, as the subject on which it is 
 now acting. Admit this doctrine as correct, and in vain, sir, has your con- 
 stitution been framed upon the principle that " the powers, not delegated to 
 the United States by the constitution, nor prohibited by it to the States, are 
 reserved to the States, respectively, or the People." In vain has this hallow- 
 ed principle been solemnly recognised, and expressly incorporated into 'he 
 constitution, by way of amendment. In vain have the People of these States 
 confided in this great fundamental principle as a solemn and safe guarantee 
 of their State sovereignties. There is not a single power, heretofore consi- 
 dered as reserved, and heretofore deemed sacred to the States, which may not 
 be as rightfully exercised by this body, as the power now proposed to be exer- 
 cised by it: for, I aver that not a single power is more completely reserved 
 to the States, under the constitution, than this power is; that, if this power is 
 not reserved, no power, whatever, is reserved to them; and it would be pre- 
 posterous, indeed, to talk or think of reserved poweri at all. But, sir, I under- 
 
556 BANK OF THE UNITED STATES. 
 
 take to aver that this power is not delegated to this body, either expressly or 
 incidentally, and I do consider an exercise of it, by this body, as an unau- 
 thorized assumption as an usurpation not only not warranted, but absolutely 
 forbidden to it by the constitution. I assert, then, that this monstrous con- 
 struction operates no- less than a complete reversal of the great and essential 
 principle which has been spoken of introduces the fatal, destructive one ? 
 that all powers, whatever, are delegated to the United States, which are not 
 expressly reserved to the States; and, in effect, converts this Government of 
 special, defined, express powers, into one entire consolidated government, 
 of general, undefined powers. 
 
 Let this alarming doctrine be fully confirmed and established, what a fatal 
 rerification will it be of the presages of some of our venerable statesmen r 
 whose mortal remains have long since been mouldering in the grave! At the 
 ever memorable and important epoch when the People of these States were 
 called upon to deliberate on the great and interesting question relating to the 
 adoption of this constitution, the minds of many were impressed with serious, 
 with solemn, and with awful apprehensions, mingled with no small degree of 
 alarm, that the very clause in the eighth section of the first article of the con- 
 stitution, which has been so often cited, might be resorted to as a ground for 
 legislating to an extent never contemplated by the framers of the constitution 
 as being within the scope of its true and legitimate meaning. It was feared 
 that the term fr * necessary," contained in the clause, though qualified and re- 
 stricted in its meaning' 1 bv the addition of the term u proper," from the union 
 and combination of which two qualities, it was manifestly intended to apply 
 the clause to the making of such laws only, as should have an immediate re- 
 lation to, and a natural, intimate connexion with, the enumerated ex- 
 press powers, as means or instruments of carrying them efficiently into exe- 
 cution, might, nevertheless, be so perverted as toliaye a construction given to 
 the clause, not confined to the limits embraced within that intention, but arbi- 
 trarily extended to laws having no manner of relation to, and no sort of na- 
 tural connexion with, 
 
 construction, once est 
 
 self to the widest c 
 
 general, were satisfied, however, to receive the constitution as proposed, with 
 
 that clause in it, resting their hopes upon the principles and structure of it. 
 
 that these were sufficiently clear and explicit to guard against the abuses and 
 
 dangers so much apprehended by some. 
 
 Now, Mr. Chairman, will the thirteenth Congress of the United States 
 fatally to those hopes fatally to the pleasing expectations then entertained by 
 the People who adopted this constitution will they so soon verify the pre- 
 sages which have been alluded to? Will they, in the re- establishment of so 
 dangerous a precedent, which was thought to have been happily demolished 
 but three or four years ago, by a refusal to re-charter a similar institution; 
 will thev. I say, at so early a period after that event, by a creation of the 
 proposed huge mammoth institution, sufficiently capacious to swallow up four 
 or nve of the former establishment; thus, hermetically seal and secure, per- 
 haps forever, the ground work of future assumptions of power, and this, too. 
 by adopting a measure, of itself fraught with inconceivable danger, the natural 
 tendency of which will be gradually, at least, if not rapidly, (and if such a 
 sad misfortune must befal this country, I pray that it may be but gradual!) 
 to break down the barriers of the constitution, and sweep away the restric- 
 tions and limitations of power, marked out by the specification of particular 
 grants, as designated in the constitution? Sir, should such a state of things 
 ever arrive should such ever be the condition of this country, when this Le- 
 gislature should so entirely change its true character when it should no 
 longer confine its proceedings to the limits of its " delegated" powers, and the 
 great leading principles of the constitutionwhen these principles snould be 
 disregarded, and cease to have any force, who could undertake to say how 
 far an evil of such great magnitude might not progress? No man, F undertake 
 to affirm, could prophetically explore the full extent of its progress. 
 
PROCEEDINGS OF 1814. 557 
 
 It is not much to be wondered at, perhaps, that gentlemen should differ in 
 opinion as to the extent to which a power, though expressly granted, ought to 
 be exercised, when that power is in its nature limited, or qualified by the 
 terms of the grant, to which different gentlemen may give different construc- 
 tions, as on several recent occasions we have witnessed. But, when a power 
 is assumed, which is not even mentioned in the constitution, I must confess, 
 sir, it appears to me as something much more extraordinary. If an erroneous 
 construction in the first case should prevail at one time, the evil will be re- 
 medied, perhaps, by a more correct construction at another time, the express 
 power being always a fixed, defined standard, to which the mind can resort? 
 and, therefore, the precedent is not likely to be as durable and dangerous as 
 in the latter case, where a mere arbitrary interpretation, or opinion, having, 
 at any.time, prevailed, upon the general ground of necessity or expediency, 
 without any such fixed, defined standard to judge by; one assumption is much 
 more likely to form a durable precedent for future similar assumptions from 
 time to time, in succession, and, consequently, so much the more dangerous. 
 If, therefore, it be not too late if gentlemen have not irrevocably made up 
 their minds upon this subject, I would beseech this honorable assembly to 
 consider to pause for a while to meditate on a subject of such vast magni- 
 tude, before they come to such irrevocable decision in favor of it, and not pre- 
 cipitately hurry into the adoption of a measure so big with momentous, incal- 
 culable consequences consequences, the extent of which the keenest fore- 
 sight of man cannot now discern the baneful influences of the evils of which 
 may be such as the most eagle eyed statesman our country produces, may not 
 be able to trace, until they shall have extended themselves beyond the reach 
 of any practicable remedy ! 
 
 The question being about to be put on Mr. CLOPTON'S motion, without de- 
 bate, 
 
 Mr. GASTON, of North Carolina, took the floor. Among the most alarming 
 indications of the times, he remarked, was the apathy which pervaded the 
 House on this occasion; an apathy resembling the numbness which generally 
 precedes mortal dissolution, under the influence of which a question of such 
 importance as this was about to be taken without debate, and almost without 
 deliberation. If the bill would produce that effect which its friends predicted, 
 it would prove a beneficial and valuable institution; if fraught with the mis- 
 chiefs which he saw in it, its passage would bring with it certain destruction 
 to the nation. He took it for granted, from the course of proceedings which 
 had taken place in the house, when this subject was before under considera- 
 tion, that all hope of obtaining a bank, at all resembling what banks have here- 
 tofore been, must now cease; and that the institution embraced by (his bill, if 
 it passed, would be a mere paper bank, and nothing else, from which no bene 
 fit could result to the Government or the community. He examined the cha- 
 racter of this bill, and particularly objected to the extent of the capital; the 
 limited proportion of specie to be employed in it; and the power to suspend 
 specie payments. Upon a full view of all its features, he denied that it would 
 restore public credit, o-r establish an adequate circulating medium, the pur- 
 poses which its friends hoped it would accomplish. It would, on the con- 
 trary, from the moment of its establishment, give birth to a monstrous scene 
 of stock jobbing and speculation, always detrimental to the public credit. 
 By a system of ri<nd economy, and carrying into effect the taxes agreed to by 
 the House, he said, he had some hope that the Government would weather the 
 storm with which it was assailed, without national bankruptcy; but, if Con- 
 gress passed a bill of this kind, he conscientiously believed it would not be 
 possible to avoid the evil; and that, if they passed this, they might as well, at 
 the same time, pass a bill of national bankruptcy. 
 
 Mr. M'KiM, of Maryland, said, without saying how he should vote on the 
 final question, he should vote against the motion to strike out the first section 
 of the bill, in the present stage of it, from motives of respect to the co-ordinate 
 
558 BANK OF THE UNITED STATES. 
 
 branch of the Legislature, from which the bill came, and to those who advo- 
 cated the bill in mis House. 
 
 The motion to strike out the first section of the bill was then decided in the 
 negative, by the following vote: 
 
 For striking it out, 50, 
 
 Against it, *71. 
 
 Mr. FISK then briefly explained the character of this bill, and in what re- 
 spect the amendments proposed by the committee would change the features 
 of it. The bill, as it came from the Senate, and as it now stands, proposes 
 that the forty millions to be subscribed by individuals, shall be at the rate of 
 twenty-seven millions of dollars in war stock, five millions in specie, and 
 eight millions in treasury notes; and that subscriptions shall be opened in 
 Boston, Baltimore, New York, Philadelphia, Richmond, Charleston, and 
 Pittsburg. The committee had recommended to reduce the proportion sub- 
 scribable by individuals, to thirty -five millions, of which twenty to be in pub 
 lie stock, five in specie, and ten in treasury notes. The details of the bill, 
 being nearly the same as those of the bill originally reported in this House, 
 were not proposed to be changed, except that the committee had recommended 
 that books ot subscription should be opened at one place in every State, in con- 
 formity with what appeared to be the sentiment of the House when the bill was 
 before under consideration. 
 
 The amendments proposed by the Committee of Ways and Means to the 
 bill, were separately considered, and agreed to by a considerable majority. 
 
 The committee proceeded in further consideration of the bill; rose, after 4 
 o'clock, reported progress, and obtained leave to sit again. 
 
 DECEMBER 24, 1814. 
 
 On motion of Mr. FISK, of New York, the House again resolved itself into 
 a committee of the whole, Mr. MACON, of North Carolina, in the chair, on the 
 bill. 
 
 The whole of the day was consumed in the discussion of the details and 
 propositions to amend this bill, without giving birth to any material amend- 
 ments. 
 
 The amendments made in the committee, were reported to the House, and 
 agreed to, before the House adjourned. 
 
 As amended, the bill exhibited the following features, viz: 
 
 The capital to consist of fifty millions of dollars, divided into shares of five 
 hundred dollars each, subscribable and payable as follows: by the Government, 
 in stock, to bear an interest of four per cent, per annum, fifteen millions; by in- 
 dividuals, the remaining thirty-five millions, payable as follows, viz: Jive mil- 
 lions in specie, ten millions in treasury notes, and twenty millions in what is 
 usually called the war stock. The bank to commence its operations so soon 
 as eleven millions five hundred thousand dollars are paid in, in the proportions 
 before mentioned, of specie, treasury notes, and stock. 
 
 Other amendments were proposed to the bill; when the House adjourned, 
 at dusk, without taking a question on the bill's going to a third reading. 
 
 DECEMBER 26, 1814. 
 
 The House proceeded to consider the amendments reported by the commit- 
 tee of the whole house; and, the amendments being further amended, were 
 concurred in by the House, except that which goes to add a new section to 
 the bill, which was concurred in, by a subsequent vote; Yeas 95, Nays 36; 
 which section is as follows: 
 
 SEC. 14. And be it further enacted. That it shall at all times be lawful for 
 a committee, of either House of Congress, appointed for that purpose, to in- 
 spect the books, and to examine into the proceedings of the corporation hereby 
 
PROCEEDINGS OF 1814. 
 
 created j and to report whether the provisions of this charter have been by the 
 same violated or not: and whenever any committee, as aforesaid, shall find 
 and report, or the President of the United States shall have reason to believe, 
 that the charter has been violated, it may be lawful for Congress to direct, or 
 the President to order, a scire facias to be sued out of the circuit court, for the 
 district of Pennsylvania, in the name of the United States, which shall be ex- 
 ecuted upon the President of the corporation, for the time being, at least fifteen 
 days before the commencement of the term of said court, calling on the said 
 corporation to show cause wherefore the charter, hereby granted, shall not be 
 declared forfeited: and it shall be lawful for the said court, upon the return of 
 the said scire facias, to examine into the truth of the alleged violation, and, if 
 such violation be made appear, then to pronounce and adjudge that the said 
 charter is forfeited and annulled : Provided^ however, Every issue of fact, 
 which may be joined between the United States and the corporation aforesaid, 
 shall be tried by jury; and it shall be lawful for the court, aforesaid, to require 
 the production of such of the books of the corporation, as it may deem neces- 
 sary for the ascertainment of the controverted facts; and the final judgment of 
 the circuit court aforesaid, shall be examinable in the Supreme Court of the 
 United States, by writ of error, and may be there reversed or affirmed, ac- 
 cording to the usages of law. 
 
 DECEMBER 27, 1814. 
 The House then resumed the consideration of the bill: 
 
 A motion was made by Mr. HALE to amend the bill, by striking out the 
 thirteenth section of the bill, which authorizes occasional suspensions of pay- 
 ments in specie by the bank. Whereupon, 
 
 Mr. IXGEROSLL, of Pa. required the previous question, (which precludes all 
 further debate or amendment of the bill.) 
 
 This call being duly sustained, the previous question was taken and decided, 
 as follows: 
 
 For taking the main question, 72. 
 
 Against taking it, 70. 
 
 The previous question having thus been decided in the affirmative, a motion 
 was made by Mr. WEBSTER, to lay the bill and amendments on the table. 
 
 The Chair decided, (Mr. MACON, in the absence of Mr. CHEVES, occupy- 
 ing the chair,} that the motion was not in order; inasmuch as, the House 
 having decided that the main question shall be now put, no other motion can 
 obtain, unless a motion to adjourn. 
 
 An appeal was taken from this decision of the chair; which, after some de- 
 bate, was confirmed, by yeas and nays, by the following vote: 
 
 In favor of the'chair, 108. 
 
 Against it, 36. 
 
 An inquiry was then niade as to what question was before the House: the 
 Speaker decided the main question to be, 4 * shall the amendments agreed to 
 be engrossed, and the bill be read the third time? 
 
 Mr. GASTOX, of N. C. then took an appeal from the decision of the Chair. 
 (Mr. MACON still occupying it.) He contended, that the mam question was 
 that on the amendment under discussion, when the previous question was 
 called. 
 
 [This question has more than once been decided in the same manner, by the 
 present and late Speaker, and affirmed with much solemnity. ] 
 
 After some debate, the decision of the Chair was affirmed by the following 
 vote: 
 
 In favor of the decision, 91. 
 
 Against it, 52. 
 
 The main question, viz. Shall the amendments be engrossed, and, together 
 with the bill, be read a third time? was then put, and decided as follows: 
 
560 BANK OF THE UNITED STATES. 
 
 Those who voted in the affirmative, are, 
 
 Messrs. Alexander, 
 
 Messrs. Fisk, ofN. Y. 
 
 Messrs. Moore, 
 
 Alston, 
 
 Forney, 
 
 Murfree, 
 
 Anderson, 
 
 Forsyth, 
 
 Nelson, 
 
 Archer, 
 
 Gourdin, 
 
 Ormsby, 
 
 Avery, 
 
 Griffin, 
 
 Parker, 
 
 Bard, 
 
 Harris, 
 
 Pickens, 
 
 Barnett, 
 
 Hasbrouck, 
 
 Pleasants, 
 
 Bines, 
 
 Hawes, 
 
 Rea, of Penn. 
 
 Bradley, 
 
 Hawkins, 
 
 Rhea, of Tennessee, 
 
 Brown, 
 
 Hopkins, of Ken, 
 
 Rich, 
 
 Caldwell, 
 
 Hubbard, 
 
 Ringgold, 
 
 Calhoun, 
 
 Ingersoll, 
 
 Robertson, 
 
 Cannon, 
 
 Ingham, 
 
 Sage, 
 
 Chappell, 
 
 Irving, 
 
 Sharp, 
 
 Clark, 
 
 Irwin, 
 
 Skinner, 
 
 Clendenin, 
 
 Kent, of Maryland, 
 
 Smith, of Penn. 
 
 Comstock, 
 
 Kerr, 
 
 Smith, of Virginia, 
 
 Conard, 
 
 Kershaw, 
 
 Strong, 
 
 Creighton, 
 
 Kilbourn, 
 
 Tannehill, 
 
 Cuthbert, 
 
 King, of N. Carolina, 
 
 Taylor, 
 
 Dana, 
 
 Lefterts, 
 
 Telfair, 
 
 Davis, of Penn. 
 
 Lowndes, 
 
 Udree, 
 
 Denoyelles, 
 
 Lyle, 
 
 Ward, of N. Jersey, 
 
 Duval, 
 
 M'Coy, 
 
 Williams, 
 
 Earle, 
 
 M'Kee, 
 
 Wilson, of Penn. 
 
 Farrow, 
 
 M'Lean, 
 
 Yancey. 80. 
 
 Findley, 
 
 Montgomery, 
 
 
 Those who Toted in 
 
 the negative, are, 
 
 
 Messrs. Baylies, of Mass 
 
 Messrs. Gholson, 
 
 Messrs. John Reed, 
 
 Bigelow, 
 
 Hale, 
 
 William Reed, 
 
 Bowen, 
 
 Hall, 
 
 Ruggles, 
 
 Boyd, 
 
 Henderson, 
 
 Schureman, 
 
 Bradbury, 
 
 Humphreys, 
 
 Seybert, 
 
 Brigham, 
 
 Jackson, of R. I. 
 
 Sheffey, 
 
 Butler, 
 
 Johnson, of Vir. 
 
 Sherwood, 
 
 Caperton, 
 
 Kennedy, 
 
 Shipherd, 
 
 Champion, 
 
 King, of Mass. 
 
 Slaymaker, 
 
 Cilley, 
 
 Law, 
 
 Stanford, 
 
 Clopton, 
 
 Lovett, 
 
 Stockton, 
 
 Cooper, 
 
 Macon, 
 
 Thompson, 
 
 Cox, 
 
 Miller, 
 
 Vose, 
 
 Crawford, 
 
 Moseley, 
 
 Ward, of MM*. 
 
 Davenport, 
 
 Markell, 
 
 Webster, 
 
 Davis, of MAM. 
 
 Newton, 
 
 Wheaton, 
 
 Desha, 
 
 Oakley, 
 
 White, 
 
 Ely, 
 
 Pearson, 
 
 Wilcox, 
 
 Evans, 
 
 Pickering, 
 
 Wilson, of Mass. 
 
 Franklin, 
 
 Pitkin, 
 
 Winter 62. 
 
 Gaston, 
 
 Potter, 
 
 
 So the bill was ordered to be read a third time, to-morrow; and the House 
 
 adjourned. 
 
 
 
 
 
 DECEMBER 28, 1814. 
 
 The bill was taken up for a third reading, as amended: 
 
 Mr. GASTON, moved, that the bill be re-committed to the Committee of 
 Ways and Means, witn instructions to report an amendment to the second 
 section, authorizing twenty millions of dollars (therein directed to be paid in 
 gold or silver coin, or in public debt of the United States, contracted under 
 the act of Congress of the 14th March, 1812, or subsequent acts,) to be paid in 
 
PROCEEDINGS OF 1814. 
 
 gold or silver coin; or in any public debt of the United States, contracted, or 
 to be contracted, which at the time of payment shall bear an accruing interest 
 of six per centum, per annum; and to extend the time of opening the sub- 
 scriptions at New Orleans, Lexington, and Chillicothe; and also, to strike out 
 so much of the eighteenth fundamental rule, as directs that all the money pay- 
 ments, made by said bank, during the present war, shall be made at Philadel- 
 phia. 
 
 And the question being taken thereon, it passed in the affirmative: Yeas 79, 
 Nays 76. 
 
 DECEMBER 29, 1814. 
 
 Mr. ARCHER, of Maryland, from the Committee of Ways^ 
 whom the bill was re-committed, reported three amendment 
 formity to the instructions of the House. 
 
 The first amendment proposes to substitute the second MwWau^i February 
 for the third Monday in January, as the day on which the books of subscrip- 
 tion to the bank shall be opened. Agreed to. 
 
 The second amendment proposes to strike out so much of the bill as de- 
 scribes the (war) stock which shall be subscribable to the bank, and in lieu, 
 thereof to insert, " any public debt of the United States contracted, or to be 
 contracted, which, at the time of payment, shall bear an accruing interest of 
 six per centum per annum." 
 
 After a few words from Mr. GASTOX and Mr. OAKLEY, expressive of a 
 hope that this amendment would pass and from Mr. INGHAM and Mr- 
 DESHA, to the contrary, the question on this amendment was decided, 
 without debate, by the following vote: 
 
 For the amendment, - 72, 
 
 Against it, 73. 
 
 So the House refused to accept this amendment. 
 
 The other amendment proposes to strike out that part of the eighteenth 
 rule which restricts the payment of the notes in specie to such as are presented 
 at the principal bank. 
 
 The adoption of this amendment was opposed by Mr. ARCHER, Mr. FOR- 
 SYTH, Mr. IxiniAM, Mr. HAWKINS, and others, on the ground, generally, that 
 the provision would not, in fact, be effectual, because it would be in the power 
 of the bank, notwithstanding such provision, to issue notes payable at the 
 principal bank: but, if it would be operative, its effect would be injurious in 
 the highest degree, inasmuch as it would, in a very few days after the bank 
 commenced operation, compel it to cease payment in specie, owing to its 
 liability to pay it at so many points, and the great demand for specie noyv 
 existing, and likely to continue during the war, to the end of which this 
 proposition was limited. 
 
 The amendment was supported by Mr. SHARP and Mr. OAKLEY, and 
 others, on the ground, principally > that it would be infinitely better that the 
 notes should bear on their face their actual value, and place of payment, than 
 that they should purport to be payable at places at which in fact they would 
 not be payable in specie. If made payable at Philadelphia only, the persons 
 receiving the paper would know its real value, and not under a deceptive 
 aspect ol being payable at any of the branches, where in fact no payment in 
 specie was to be made, &c. It was also objected to the bill, as it stood, 
 that it would drain all the specie in the country, to accumulate it at Phila- 
 delphia. 
 
 The question on the amendment resulted, by Yeas and Nays, as follows: 
 For the amendment, - ... 76, 
 
 Against it, - 76. 
 
 The Speaker (Mr. CHEVES) decided it in the affirmative by his casting vote. 
 
562 BANK OF THE UNITED STATES. 
 
 Mr. FARROW then moved to amend the bill, by striking out so much as de- 
 scribes the stock to be subscribable, and inserting, in lieu thereof, a provision 
 limiting the privilege of subscription in the stock of the bank, to such public 
 debt as shall be hereafter contracted. 
 
 This motion was opposed by Mr. INGHAM, and Mr. FORSYTH, and others 
 and supported by Mr. GASTOX, Mr. OAKLEY, Mr. POTTER, and others. The 
 latter gentleman took this occasion to make a speech of some length against 
 the bill generally. 
 
 The question on Mr. FARROW'S motion was, after a warm debate, at length 
 decided as follows: 
 
 For the motion, 65, 
 
 Against it, 89.' 
 
 Mr. PITKIN then proposed a further amendment to the bill, viz. to strike 
 out the word "fifty," so as to leave the amount of the capital blank. 
 
 The previous question having been thereupon demanded by Mr. HARRIS, 
 of Tennessee, and supported by a sufficient number, viz. 75 for it, 67 against it, 
 Mr- WEBSTER moved to lay the bill on the table; which motion was nega- 
 tived by Yeas and Nays, by the following vote: 
 
 For the motion, - 56, 
 
 Against it, 93. 
 
 Another motion was then made to adjourn, and negatived. 
 The previous question was then put, in the usual form: " Shall the main 
 question be now put P" And decided as follows: 
 
 Yeas, - ------ 83, 
 
 Nays, ^ - - 63. 
 
 The question on ordering the bill to a third reading was then decided in 
 the affirmative without a division. 
 
 On the question when the bill should be read a third time, to-morrou) and 
 to-day were named. The question being taken on to-morrow, it was decided 
 in the negative. 
 
 The bill was then ordered to be read a third time to-day. 
 
 A motion was then made to adjourn, and negatived by a vote of 75 to 60. 
 
 The bill was then announced for a third reading. 
 
 Mr. BIGELOW raised a question of order, whether it was proper to read the 
 bill a third time before the other orders of the day were disposed of. The 
 Speaker having decided that bills on their reading had preference in the 
 orders of the day, Mr. B. appealed from the decision of the Speaker, (Mr. 
 MACON) which was affirmed by the House. 
 
 Mr. WEBSTER moved to re-commit the bill to a select committee, with 
 instructions, substantially, as follows: 
 
 1. To reduce the capital to twenty-five millions of dollars, with liberty to the Go- 
 vernment to subscribe five millions additional at any future time. 
 
 2. To strike out the provision allowing the bank to cease specie payment. 
 
 3. To strike out so much of the bill as makes it obligatory on the bank to lend 
 money to the Government. 
 
 4. To introdnce a provision, that, if the bank shall not commence operations within 
 months after the passage of the act, the charter shall be forfeited. 
 
 5. To allow an interest of per cent, per annum, on any note, payment of 
 
 which shall have been demanded of the bank, and refused. 
 
 6. To provide that, of the twenty -five millions, five shall be payable in specie, and 
 twenty in any United States' six per cent, stock, or in treasury notes. 
 
 7. To strike out that provision which restrains the bank from selling its stock 
 during the war. 
 
 Mr. W. supported his motion by a number of remarks, the general purport 
 of which was, that he had resorted to this method to show to the world what 
 sort of a bank he and his friends were willing to support. 
 
PROCEEDINGS OF 1815. 553 
 
 Mr GASTON followed, in a short speech in favor of this motion, and with 
 the zeal he has uniformly exhibited on this subject, in opposition to the bill. 
 
 Mr. WM. REED, of Massachusetts next took the floor in decided opposi- 
 tion to this bill, of which he expressed the utmost abhorrence, and the greatest 
 dread of its effects. 
 
 After the rejection of several motions to adjourn 
 
 Mr. BIGELOW made a speech on the same side of the question as the two 
 gentlemen who had preceded him in debate. 
 
 Before Mr. BIGELOW finished his speech, however, a motion to adjourn 
 prevailed. 
 
 JANUARY 2, 1815. 
 
 The House resumed the consideration of the bill Mr. WEBSTER'S motion 
 tore-commit the bill being still under consideration. 
 
 It was supported by Messrs. PICKERING, WEBSTER, SHIPHERD, and 
 WHEATON, in speeches of considerable length, and opposed by Messrs. FOR- 
 SYTH and RHEA, of Tenn. 
 
 Mr. WEBSTER, in support of his motion, spoke as follows: 
 
 However the House may dispose of the motion before it, I do not regret 
 that it has been made. One object intended by it, at least, is accomplished. 
 It presents a choice, and it shows that the opposition which exists to the bill 
 in its present state, is not an undistinguishing hostility to whatever may be 
 proposed as a national bank, but a hostility to an institution of such a useless 
 and dangerous nature, as it is believed the existing provisions of the bill would 
 establish. 
 
 If the bill should be recommitted and amended according to the instruc- 
 tions which I have moved, its principles will be materially changed. The 
 capital of the proposed bank will be reduced from fifty to thirty millions; and 
 composed of specie and stocks in nearly the same proportions as the capital 
 of the former Bank of the United States. The obligation to lend thirty mil- 
 lions of dollars to Government, an obligation which cannot be performed with- 
 out committing an act of bankruptcy, will be struck out. The power to sus- 
 pend the payment of its notes and bills will be abolished, and the prompt and 
 faithful execution of its contracts secured, as far as, from the nature or things, 
 it can be secured. The restriction on the sale of its stocks will be removed, 
 and as it is a monopoly, provision will be made that, if it should not commence 
 its operations in reasonable time, the grant shall be forfeited. Thus amended, 
 the bill would establish an institution not unlike the last Bank of the United 
 States in any particular which is deemed material, excepting only the legal- 
 ized amount of capital. 
 
 To a bank of this nature, I should at any time be willing to give my sup- 
 port, not as a measure of temporary policy, or as an expedient to find means 
 of relief from the present pfoverty of the treasury; but as an institution of per- 
 manent interest and importance, useful to the Government and country at all 
 times, and most useful in times of commerce and prosperity. 
 
 I am sure, sir, that the advantages which would at present result from any 
 bank, are greatly overrated. To Took to a bank, as a source capable, not only"^ 
 of affording a circulating medium to the country, but also of supplying the I 
 ways and means of carrying on the war, especially at a time wl.cn the country 
 is without commerce, is to expect much more than ever will be obtained. , 
 Such high- wrought hopes can end only in disappointment. The means of ' 
 supporting an expensive war are not of quite so easy acquisition. Banks are_^ 
 not retenue.,. They cannot supply its place. They may afford facilities to f 
 its collection and distribution; they may furnish, with convenience, tempo- 
 rary loans to Government, in anticipation of its taxes, and render important 
 assistance, in divers ways, to the general operation of finance; they are use- 
 
564 BANK OF THE UNITED STATES. 
 
 ful to the State in their proper place and .sphere; but they are not sources of 
 national income. 
 
 The fountains of revenue must be sunk deeper. The credit and circulation 
 of bank paper are the effects, rather than the causes of a profitable commerce, 
 and a well ordered system of finance. They are the props of national wealth 
 and prosperity, not the foundations of them. Whoever shall attempt to re- 
 store the fallen credit of this country, by the creating of new banks, merely 
 that they may create ne\v paper, and that Government may have a chance of 
 borrowing where it has not borrowed before, will find himself miserably de- 
 ceived. It is under the influence of no such vain hopes, that I yield my as- 
 sent to the establishment of a bank on sound and proper principles. The 
 principal good I expect from it is rather future than present. I do not see, 
 indeed, that it is likely to produce evil at any time. In times to come, it will, 
 I hope, be useful. If it were only to be harmless, there would be sufficient 
 reason why it should be supported, in preference to such a contrivance as is 
 now in contemplation. 
 
 The bank which will be erected by the bill, if it should pass in its present 
 form, is of a most extraordinary, and, as I think, alarming nature. The capi- 
 tal is to be fifty millons of dollars; five millions in gold and silver, twenty 
 millions in the public debt created since the war, ten millions in treasury 
 notes, and fifteen millions to be subscribed by Government, in stock to be 
 created for that purpose. The ten millions in treasury notes, when received 
 in payment of subscriptions to the bank, are to be funded also in United 
 States' stocks. The stock subscribed by Government on its own account, 
 and those in which the treasury notes are to be funded, to be redeemable only 
 at the pleasure of the Government. The war stock will be redeemable ac 
 cording to the terms upon which the late loans have been negotiated. 
 
 The capital of the bank, then, will be five millions of specie and forty-five 
 millions of Government stocks. In other words, the bank will possess five 
 millions of dollars, and the Government will owe it forty-five millions. This 
 debt from Government, the bank is restrained from selling during the war, 
 and Government is excused from paying, until it shall see fit. The bank is 
 also to be under obligation to loan Government thirty millions of dollars on 
 demand, to be repaid,, not when the convenience or necessity of the bank may 
 require, but when debts due to the bank, from Government, are paid; that is T 
 when it shall be the good pleasure of Government. This sum of thirty mil- 
 lions is to supply the necessities of Government, and to supersede the occa- 
 sion of other loan:?. This loan will doubtless be made on the first day of the 
 existence of the bank, because the public wants can admit of no delay. Its 
 condition, then, will be, that it has five millions of specie, if it has been able 
 to obtain so much, and a debt of seventy-five millions, no part of which it can 
 either sell or call in, due to it from Government. 
 
 The loan of thirty millions to Government can only be made by an imme- 
 diate issue of bills to that amount. If these bills should return, the bank will 
 not be able to pay them. This is certain; and to remedy this inconvenience* 
 power is given to the directors, by the act, to suspend, at their own discre- 
 tion, the payment of their notes, until the President of the United States shall 
 otherwise order. The President will give no such order, because the neces- 
 sities of Government will compel it to draw on the bank till the bank becomes 
 as necessitous as itself. Indeed, whatever orders may be given or withheld, it 
 will be utterly impossible for the bank to pay its notes, No such thing is ex- 
 
 /' pected from it. The first note it issues will be dishonored on its return, and 
 yet it will continue to pour out its paper, so long as Government can apply it 
 in any degree to its purposes. 
 
 What sort of an institution, sir, is this? It looks less like a bank, than a 
 department of Government. It will be properly the paper-money department. 
 Its capital is Government debts; the amount ot its issues will defend on Go- 
 vernment necessities; Government, in effect, absolves itself from its own 
 debts to the bank, and by way of compensation, absolves the bank from its- 
 own contracts with others. This is, indeed, a wonderful scheme ot nuance, 
 
PROCEEDINGS OF 1815. 
 
 The Government is to grow rich, because it is to borrow without the obliga- 
 tion of repaying, and is to borrow of a bank which issues paper without lia- 
 bility to redeem it. If this bank, like other institutions which dull and plod- 
 ding common sense has erected, were to pay its debts, it must have some 
 limits to its issues of paper, and therefore, there would be a point beyond 
 which it could not make loans to Government. This would fall short of the 
 wishes of the contrivers of this system. They provide for an unlimited issue 
 of paper, in an entire exemption from payment. They found their bank, in 
 the first place, on the discredit of Government, and then hope to enrich Go- 
 vernment out of the insolvency of their bank. With them, poverty itself is 
 the main source of supply, and bankruptcy a mine of inexhaustible treasure. 
 They rely not in the ability of the bank, but in its beggary; not in gold and 
 silver collected in its vaults, to pay its debts, and fulfil its promises, but in its 
 locks and bars ? provided by statute, to fasten its doors against the solicitations 
 and clamors of importunate creditors. Such an institution, they flatter them- 
 selves, will not only be able to sustain itself, but to buoy up the sinking cre- 
 dit of the Government. A bank which does not pay, is to guaranty the en- 
 gagements of a Goverment which does not pay! "John Doe is to become 
 security for Richard Roe." Thus the empty vaults of the treasury are to be 
 filled from the equally empty vaults of the bank, and the ingenious invention 
 of a partnership between insolvents, is to restore and re-establish the credit 
 of both. 
 
 Sir, I can view this only as a system of rank speculation, and enormous 
 mischief. Nothing in our condition is worse, in my opinion, than the incli- 
 nation of Government to throw itself upon such desperate courses. If we are 
 to be saved, it is not to be by such means. If public credit is to be restored, 
 this is not one of the measures that will help to restore it. If the treasury is 
 exhausted, this bank will not fill it with any thing valuable. If a safe circu- 
 lating medium be wanted tor the community, it will not be found in the paper 
 of such a corporation. 
 
 I wish, sir, that those who imagine that these objects, or any of them, will 
 be effected by such a bank as this, would describe the manner in which they 
 expect it to be done. What is the process which is to produce these results? 
 If it is perceived, it can be described. The bunk will not operate either by 
 miracle or magic. Whoever expects any good from it, ought to be able to 
 tell us in what way that good is to be produced. As yet, we have had nothing 
 but general ideas, and vague and loose expressions. An indefinite and indis- 
 tinct notion is entertained, nobody here seems to know on what ground, that 
 this bank is to reanimate public credit, fill the treasury, and remove all the. 
 evils that have arisen from the depreciation of the paper of the existing banks. 
 
 Some gentlemen, who do not profess themselves to be, in all respects, pleased 
 with the provisions of the bill, seem to content themselves with an idea that 
 nothing better can be obtained, and that it is necessary to do something. A 
 strong impression that something must be done, is the origin of many bacfmea- 
 sures. It is easy, sir, to do something, but the object is to do something use- 
 ful. It is better to do nothing than to do mischief. It is much better, in my 
 opinion, to make no bank, than to pass the bill as it now is. 
 
 The interests to be affected by this measure, the finances, the public credit, 
 and the circulating medium of the country, are too important to be hazarded 
 in schemes like these. If we wish to restore the public credit, and to re- 
 establish the finances, we have the beaten road before us. All true analogy, 
 all experience, and all just knowledge of ourselves and our condition, point 
 one way. A wise and systematic economy, and a settled and substantial 
 revenue, are the means to be relied on; not excessive issues of bank notes, a 
 forced circulation, and all the miserable contrivances to which political folly 
 can resort, with the idle expectation of giving to mere paper the quality of 
 money. 
 
 These are all the inventions of a shortsighted policy, vexed and goaded by 
 the necessities of the moment, and thinking less of a permanent remedy, than 
 of shifts and expedients to avoid the present distress. They have been a 
 
586 BANK OF THE UNITED STATES. 
 
 thousand times adopted, and a thousand times exploded as delusive and ruin- 1 
 ous, as destructive of all solid revenue, and incompatible with the security of 
 private property. 
 
 It is, sir, sufficiently obvious, that, to produce any benefit, this bank must 
 be so constructed, as that its notes shall have credit with the public. The 
 first inquiry, therefore, should be, whether the bills of a bank of this kind 
 will not be immediately and greatly depreciated, 1 think they will. It would 
 be a wonder if they should not. This effect will be produced by that exces- 
 sive issue of its paper which the bank must make in its loan to Government* 
 Whether its issues of paper are excessive, will depend not on the nominal 
 amount of its capital, but on its ability to redeem it. This is the only safe 
 criterion. Very special cases nay perhaps furnish exceptions, but there is, 
 in general, no security for the credit of paper, but the ability, in those who 
 emit, to redeem it. Whenever bank notes are not convertible into gold and 
 silver, at the will of the holder, they become of less value than gold arid silver. 
 All experiments on this subject have come to the same result. It is so clear, 
 and has been so universally admitted, that it would be waste of time to dwell 
 upon it. The depreciation may not be sensibly perceived the first day, or Ihe 
 first week, it takes place. It will first be discerned in what is called the rise 
 of specie; it will next be seen in the increased price of all commodities. The 
 circulating medium of a commercial community must be that which is also 
 the circulating medium of other commercial communities, or must be capable 
 of being converted into that medium, without loss. It must be able, not only 
 to pass in payments and receipts, among individuals of the same society and 
 nation, but to adjust and discharge the balance of exchanges between different 
 nations. It must be something which has a value abroad, as well as at home, 
 and by which foreign as well as domestic debts, can be satisfied. The pre- 
 cious metals alone answer these purposes. They alone, therefore, are money, 
 and whatever else is to perform the offices of money, must be their represen- 
 tative, and capable of being turned into them at will. So long as bank paper 
 retains this quality, it is a substitute for money; divested of this, nothing can 
 give it that character. No solidity of funds, no sufficiency of assets, no con- 
 fidence in the solvency of banking institutions, has ever enabled them to keep 
 up their paper to the value of gold and silver, any longer than they paid gold 
 and silver for it on demand. This will continue to be the case so long as 
 those metals shall continue to be the standard of value, and the general cir- 
 culating medium among nations. 
 
 A striking illustration of this common principle is found in the early history 
 of the Bank of England. In the year 1 697, it had been so liberal of its loans, 
 that it was compelled to suspend the payment of its notes. Its paper imme- 
 diately fell to a discount of near twenty per cent. Yet such was the public 
 opinion of the solidity of its funds, that its stock then sold for one hundred and 
 ten per cent., although no more than sixty per cent, upon the subscription had 
 been paid in. 
 
 The same fate, as is well known, attended the banks of Scotland, when 
 they adopted the practice of inserting in their notes a clause, giving the banks 
 an option of paying their notes on demand, or six months after demand, with 
 interest. Paper of this sort was not convertible into specie, at the pleasure of 
 the holder; and no conviction of the ability of the bank which issued it, could 
 preserve it from depreciation. 
 
 The suspension of specie payments by the Bank of England, 1797, and the 
 consequences which followed, afford no argument to overthrow this general 
 experience. If Bank ot England notes were not immediately depreciated, on 
 that occasion, depreciation, nevertheless, did ensue. Very favorable causes 
 existed to prevent their sudden depression. It was an old and rich institu- 
 tion. It was known to be under the most discreet and independent manage- 
 ment. Government had no control over it, to force it to make loans, against 
 its interest or its will . On the contrary, it compelled the Government to pay, 
 though with much inconvenience to itself, a very considerable sum which 
 was due to it. The country enjoyed, at that time, an extensive commerce, 
 
PROCEEDINGS OF 1815. 
 
 and a revenue of three hundred millions of dollars was collected and dis- 
 tributed through the bank. Under ill these advantages, however, the dif- 
 ference of price between bank notes and coin became at one time so great, as 
 to threaten the most dangerous consequences. 
 
 Suppose the condition of England to have been reversed. Suppose that, 
 instead of a prosperous and increasing commerce, she had suffered the ruin 
 of her trade, and that the product of her manufactures had lain upon her hands, 
 as the product of our agriculture now perishes in ours. Does any one imagine 
 that her circulating paper could have existed, and maintained any credit, in 
 such a change of her condition? What ought to surprise us is not that her 
 bank paper was depreciated, but that it was not depreciated sooner and lower 
 than in fact it was. The reason can only be found in that extraordinary com- 
 bination of favorable circumstances, which never existed before, and is hardly 
 to be expected again. Much less is it to be discovered in our condition at 
 present. 
 
 But we have experience nearer home. The paper of all the banks south of 
 New England has become depreciated to an alarming extent. This cannot 
 be denied. All that is said of the existence of this depreciation, remote from 
 the banks, is unfounded and idle. It exists every where. The rates of ex- 
 change, both foreign and domestic, put this point beyond controversy. If a 
 bill of exchange on Europe can be purchased, as it may, twenty per cent, 
 cheaper in Boston than in Baltimore, the reason must be that it is paid for, 
 in Boston, in money, and, in Baltimore, in something twenty per cent, less 
 valuable than money. 
 
 Notwithstanding the depression of their paper, it is not probable that any 
 doubt is entertained of the sufficiency of the funds of the principal banks. 
 Certainly no such doubt is the cause of the fall of their paper; because the 
 depression of the paper of all the banks in any place is, as far as I learn, gene- 
 rally uniform and equal; whereas, if public opinion proceeded atall upon the 
 adequacy or inadequacy of their funds, it would necessarily come to different 
 results, in different cases, as some of these institutions must be supposed to 
 be richer than others. 
 
 Sir, something must be discovered which has hitherto escaped the observa- 
 tion of mankind, before you can give to paper, intended for circulation, the 
 value of a metallic currency, any longer than it represents that currency, and 
 is convertible into it, at the will of the holder. 
 
 The paper, then, of this bank, if you make it, will be depreciated, for the 
 same reason that the p:\per of other banks that have gone before it, and of 
 those which now exist around us, has been depreciated: because it is not to 
 pay specie for its notes. 
 
 Other institutions, setting out perhaps on honest principles, have fallen into 
 discredit, through mismanagement or misfortune. But this bank is to begin 
 with insolvency. It is to issue its bills to the amount of thirty millions, when 
 everybody knows it cannot pay them. It is to commence its existence in 
 dishonor. It is to draw its first breath in disgrace. The promise contained 
 in the first note it sends forth is to be a false promise^ and whoever receives 
 the note, is to take it with the knowledge that it is not to be paid according 
 to the terms of it. 
 
 But this, sir, is not all. The frarners of this bill have not done their work 
 by halves. They have put the depreciation of the notes of their bank beyond 
 all doubt or uncertainty. They have made assurance doubly sure. In addi- 
 tion to excessive issues of paper, and the failure to make payments, both 
 which they provide for by law, they make the capital of tne bank to consist 
 principally of public stock. 
 
 If this stock should be sold, as in the former bank of the United States, the 
 evil would be less. But the bank has not the power to sell it, and, for all pur- 
 poses of enabling it to fulfil its engagements, its funds might as well be at the 
 bottom of the ocean as in Government stocks, of which it cannot enforce pay- 
 ment, and of which it cannot dispose. 
 
5(3 ft BANK OF THE UNITED STATES. 
 
 The credit of this institution is to be founded on public funds, not on pri- 
 vate property, or commercial credit. It is to be a financial, not a commercial 
 bank. Its credit can hardly, therefore, be better at any time than the credit 
 of tl ^ Government. If the stocks be depreciated, so of course must every 
 thing be which rests on the stocks. 
 
 It would require extraordinary ingenuity to show how a bank, which is 
 founded on the public debt, is to have any better reputation than the debt it- 
 self. It must be some very novel invention which makes the superstructure 
 keep its place after the foundation has fallen. The argument seems to stand 
 thus: The public funds, it is admitted, have little credit; the bank will have 
 no credit which it does not borrow of the funds; but the bank will be in full 
 credit. 
 
 If, sir, we were in a temper to learn wisdom from experience, the history 
 of most of the banks on the continent bf Europe might teach us the futility of 
 all these contrivances. Those were, like this before us, established for the 
 purposes of finance, not purposes of commerce. The same fortune has hap- 
 pened to them all. Their credit has sunk. Their respective Governments 
 go to them for money, when they can get it no where else, and the banks can 
 relieve their wants only by new issues of their own paper. As this is not re- 
 deemed, the invariable consequence of depreciation follows; and this has 
 sometimes led to the miserable and destructive expedient of depreciation of 
 the coin itself. 
 
 Such are the banks of Petersburg, Copenhagen, Vienna, and other cities of 
 Europe; and while the paper of these Government banks has been thus de- 
 pressed, that of other banks, existing in their neighborhood, unconnected with 
 Government, and conducting their business on the basis of commercial credit, 
 has retained a value equivalent to that of coin. 
 
 Excessive issues of paper, and a close connexion with Government, are the 
 circumstances which, of all others, are the most certain to destroy the credit 
 of bank paper. If there were no excessive issues, or, in other words, if the 
 bank paid its notes in specie, on demand, its connexion with Government, 
 and its interest in the funds, would not, perhaps, mat eri illy affect the circu- 
 lation of its paper, although they would naturally diminish the value of its 
 stock. But, when these two circumstances exist in the condition of any bank, 
 that it does not pay its notes, and that its funds are in public stocks, and all 
 its operations intimately blended with the operations of Government, nothing 
 further need be known, to be quite sure that its paper will not answer the pur- 
 pose of a creditable circulating medium. 
 
 I look upon it, therefore, sir, as certain, that a very considerable discount 
 will attach itself to the notes of this bank, the first day of their appearance; 
 that this discount will continue to increase; and, unless Congress should be 
 able to furnish some remedy, which is not certain, the paper, in the end, will 
 be worth nothing. If this happens, not only will no one of the benefits pro- 
 posed be obtained, but evils of the most alarming magnitude will follow. All 
 the horrors of a paper-money system are before us. If we venture on the 
 present expedient, we shall hardly be able to avoid them. The ruin of public 
 affairs and the wreck of private property will ensue. 
 
 I would ask, sir, whether the friends of this measure have well considered 
 what effect it will produce on the revenue of the country? By the provisions 
 of this bill, the notes of this bank are to be received in payment of all taxes 
 and other dues to Government. They cani:ot be refused on account of the de- 
 preciation of their value. Government binds itself to receive them at par, 
 although it should be obliged immediately to pay them out, at a discount of a 
 hundred per cent. It is certain, then ? that a loss in the revenue will be sus- 
 tained, equal to any depreciation which may take place in this paper; and, 
 when the paper shall come to nothing, the revenue of the country will come to 
 nothing along with it. This has happened to other countries, where this 
 wretched system has been adopted, and it will happen here. 
 
 The Austrian Government resorted to a similar experiment, in a very criti- 
 cal period of its affairs, in 1809, the year of the last campaign between that 
 
PROCEEDINGS OF 1815, 
 
 tountry and France, previous to the coalition. Pressed by the necessities of 
 the occasion, the Government caused a large quantity of paper to be issued, 
 which was to be received in imposts and taxes. The paper immediately fell 
 to a depreciation of four for one. The consequence was, that the Government 
 lost its revenue, and, with it, the means of supplying its armies and defend- 
 ing its empire. 
 
 Is this Government now ready, sir, to put its resources all at hazard, by 
 pursuing a similar course? Is it ready to sacrifice its whole substantial reve- 
 nue arid permanent supplies to an ill-contrived, ill-considered, dangerous, and 
 ruinous project, adopted only as the means of obtaining a little present and 
 momentary relief? 
 
 It ought to be considered, also, what effects this bank will produce on other 
 banking institutions, already existing, and on the paper which they have issu- 
 ed. Tee aggregate capital of these institutions is large. The amount of their 
 notes is large, and these notes constitute, at present, in a great portion of the 
 country, the only circulating medium, if they can be called a circulating me- 
 dium. Whatever aft'ects this paper, either to raise it, or depress it lower than 
 it is, affects the interests of every man in the community. 
 
 It is sufficient, on this point, to refer to the memorial from the banks of New 
 York. That assures us, that it must be the operation of such a bank as this 
 bill would establish, to increase the difficulties and distress which the existing 
 banks now experience, and to render it nearly impossible for them to resume 
 the payment of their notes. This is what every man would naturally expect. 
 Paper, already depreciated, will necessarily be sunk still lower, when another 
 flood of depreciated paper is forced into circulation. 
 
 Very recently this Government refused to extend the charter of the bank of 
 the United States, upon the ground that it was unconstitutional for Congress 
 to create banks. Many of the State banks owe their existence to this deci- 
 sion. It was an invitation to the States to incorporate as much banking capi- 
 tal as would answer all the purposes of the country. Notwithstanding what 
 we may now see and hear, it would then have been deemed agross imputation 
 on the consistency of Government, if any man had expressed an expectation, 
 that, in five years, all these constitutional scruples would be forgotten; all 
 the dangers to political liberty from moneyed institutions disregarded, and a 
 bank proposed upon the most extraordinary principles, with an unprecedented 
 amount of capital, and with no obligation to fulfil its contracts. 
 
 The State banks have not forced themselves in the way of Government. 
 They were established, many of them at least, when Government had declar- 
 ed its purpose to have no bank of its own. They deserve some regard on their 
 own account, and on account of those particularly concerned in them. But 
 they deserve much more consideration, on account of the quantity of paper 
 which is in circulation, and the interest which the whole community has in it. 
 
 Let it be recollected, also, sir, that the present condition of the banks is 
 principally owing to their advances to Government. The treasury has bor- 
 rowed of the banks, or of those who themselves borrowed of the banks, till 
 the banks have become as poor ? and almost as much discredited, as the trea- 
 sury itself. They have depreciated their paper, nearly ruined themselves, 
 and brought the sorest distress OH the country, by doing that on a small scale 
 \vhich this bank is to perform on a scale vastly larger. 
 
 It is almost unpardonable, in the conductors of these institutions, not to have 
 foreseen the consequences which have resulted from the course pursued by 
 them. They were all plain and visible. If they have any apology, it is, that 
 they were no blinder than the Government, and that they yielded to those who 
 would take no denial. It will be altogether unpardonable in us, if, with this, 
 as well as all other experience before us, we continue to pursue a system 
 which must inevitably lead us through depreciation of currency, paper-money. 
 tender-laws, and all the contemptible and miserable contrivances ot disordered 
 finance and national insolvency, to complete and entire bankruptcy in the end. 
 
 I hope the House will recommit the bill for amendment 
 72 
 
570 BANK OF THE UNITED STATES. 
 
 The question on re-commitment was at length decided in the negative, 
 Yeas y 68, 
 
 Nays, - 89. 
 
 The bill was then read through in the usual manner. 
 
 Mr. RHEA, of Tenn. spoke a short time in explanation of the motives which 
 would govern his vote in this case. 
 
 Mr. GROSVENOR, for the purpose of introducing a motion in aid of the rule 
 to prevent those members interested in the question from voting, moved t& 
 lay the bill an the table, 
 
 The motion was predicated on the fact, that one member of the House 
 (and perhaps others might be) was the proprietor of certain of the public 
 stock, which is allowed to be paid iri y in part r on account of shares to be sub- 
 scribed to the bank. 
 
 This motion was opposed by Mr. FISK, of New York, and Mr. FINDLEY, 
 of Pennsylvania j by whom it was contended, that the rule of the House in 
 this respect was sufficiently operative without this aid. It was supported by 
 the mover, and by Mr. WARI>, and Mr. FARROW. 
 
 The question on laying the bill on the table, was decided by Yeas and Nays,, 
 as follows: 
 
 For laying the bill on the table y 58, 
 
 Against it, 104. 
 
 The question was then taken on the passage of the bill. The Yeas and 
 Nays thereon stood as follows: 
 
 Those who voted in the affirmative, are, 
 
 Messrs.. Alexander,, Messrs*. Fisk, of N. Y, Messrs. Montgomery, 
 
 Alston, Forney, Moore, 
 
 Anderson, Forsyth^ Murfree, 
 
 Archer,, Gholson, Nelson, 
 
 Avery, Gourdin, Ormsby, 
 
 Barnett, Griffin, Parker, 
 
 Bigelow, Harris, Pickens, 
 
 Bradley, Hasbrouck, Pleasants, 
 
 Brown,. Hawes, Rea, of Pa. 
 
 Caldwell, Hawkins, Rhea, of Tenn,. 
 
 Cannon, Hopkins, of Ky Rich, 
 
 Ghappell, Hubbard, Ringgold, 
 
 Clark, Ingersoll, Robertson, 
 
 Clendenin, Ingham, Sage, 
 
 Comstock, Irving, Sevier, 
 
 Conard, Irwin, Sharp, 
 
 Creighton,. Kent, of Mo!, Skinner, 
 
 Crouch, Kerr, Smith, of Fs- 
 
 Cuthbert, Kershaw, Strong, 
 
 Dana, Kilbourn, Tannehill, 
 
 Davis, of Pa King, of N. C. Taylor, 
 
 Denoyelles, Lefferts, Telfair, 
 
 Duvall, Lowndes. Udree, 
 
 Earle, Lyle, Ward, of N. J. 
 
 Farrow, M'Coy, Williams, 
 
 Findley, M'Kee, Wilson, of Pent* 
 
 Fisk, of Vt. M'Lean, Yancey 81. 
 Those who voted in the negative, are, 
 
 Messrs. Bard, Messrs. Boyd, Messrs. Butler, 
 
 Baylies, of Mass. Bradbury,. Caperton, 
 
 Bayly, of Va. Breckenridge,. Calhoun, 
 
 Bines,. Brigham, Champion, 
 
 Bowen, Burwell, Cilley> 
 
PROCEEDINGS OF 1816. 571 
 
 Messrs. Clopton, Messrs. Jackson, of R. I. Messrs. Ruggles, 
 
 Cooper, Johnson, of Va. Schureman, 
 
 Cxe, Johnson, of Ky. Seybert, 
 
 Crawford, Kennedy, Sheffey, 
 
 Culpeper, Kent, of N. Y. Sherwood, 
 
 Davenport, King, of Mass. Shepherd, 
 
 Davis, of MasB. Law, Slaymaker, 
 
 Desha, Lewis, Stanford, 
 
 Ely, Lovett, Stockton, 
 
 Evans, Macon, Stuart, 
 
 Franklin, M'Kim, Sturges, 
 
 Gaston, Miller, Taggart, 
 
 Geddes, Mosele.y, Thompson, 
 
 Glasgow, Markell, Vose, 
 
 Grosvenor, Newton, Ward, of Mas.* 
 
 Hale, Oakley, Webster, 
 
 Hall, Pearson, Wheaton, 
 
 Hanson, Pickering, White, 
 
 Henderson, Pitkin, Wilcox, 
 
 Howell, Potter, Wilson, of Mass. 
 
 Humphreys, John Reed, Winter 80. 
 
 Hurlbert," Win. Reed, 
 
 The state of the vote having been declared 
 
 The Speaker (Mr. CHBVES, of South Carolina) rose. After adverting to 
 the rule of the House, which makes it the right and duty of the Speaker to 
 vote in two cases, of which this was one, he proceeded to assign briefly, the 
 reasons which influenced him to vote against the bill. He noticed the opin- 
 ions expressed on both sides of the House, for and against the measure; and 
 declared his own conviction, that the bill proposed a dangerous, unexampled, 
 and, he might almost say, a desperate resort. He cursorily examined the 
 three views in which the passage of the bill had been advocated, namely, as 
 calculated to resuscitate public credit; to establish a circulating medium; 
 and to afford the ways and means for the support of Government. He 
 delivered, with even more of his usual eloquence and impressiveness, his 
 opinions on these several points, and concluded with expressing his solemn 
 belief, that neither of these purposes would be answered by the bill. He 
 denied that the passage of this bill was demanded by the safety of the nation; 
 but intimated his opinion, that a national bank bill might be framed, by which 
 the avowed objects of the present bill might be accomplished, which he had 
 no doubt would unite a majority in its favor. Although the vote was painful 
 to him to give, he was, therefore, obliged to vote in the negative. 
 
 The Speaker's vote having produced an equality of votes* he declared the 
 decision of the House to be, that the bill should not pass. 
 
 So THE BILL WAS REJECTED. 
 
 Mr. HALL, of Georgia, who had voted against the bill, then moved a re- 
 consideration of the vote just taken. He said he was opposed to this bill, 
 and should be opposed to any bill for the establishment of a national bank; 
 but he was willing that his friends should have an opportunity of giving such 
 a shape to the bill on that subject, as should unite the votes of all who were 
 friendly on principle to the establishment of a national bank. 
 
 The question for a re-consideration of the vote having been stated from the 
 chair 
 
 A motion was made to adjourn, and decided in the affirmative. 
 
 JANUARY 3, 1815. 
 
 The House resumed the consideration of the unfinished business, being a 
 motion to reconsider the vote to reject the bill. 
 
572 BANK OF THE UNITED STATES. 
 
 Ou this motion there arose a desultory, but very interesting debate, which 
 occupied the House from 12 to about 5 o'clock* 
 
 Mr. HALL, of Georgia, commenced the debate, by assigning the reasons 
 which had influenced him to move a reconsideration of the question, which 
 were, generally, that, though he was, and should continue to be. opposed to 
 any bank that could be established, unless within the District of Columbia, 
 yet the state of the vote of last night gave him reason to believe that some 
 plan might be adopted to meet the views of what was evidently a majority of 
 the House on that subject. He therefore proposed, if the vote should be re- 
 considered, to call up the proposition laid upon the tabb by him some time 
 ago, respecting an issue of treasury notes, and to move its reference, together 
 with this bill, to the Committee of Ways and Means, that, from a combina- 
 tion of the principles of both, some measure might be adopted which would 
 subserve the public interest. He called upon gentlemen of the majority, in 
 an impressive manner, to rally themselves around the public good, to sacri- 
 fice to each other a little of their own opinion, in order to serve the nation. 
 Having to contend, not only with a foreign enemy, but with internal traitors, 
 it was high time, instead of putting themselves into the hands of merchants, 
 and men who are determined, if they could, to crush the present administra- 
 tion, to draw on the real solid resources of the nation, &c. Mr. H. took oc- 
 casion to express his disgust at the attempt, twice repeated, which he had 
 witnessed, to prevent an individual from voting, because he had lent money 
 to the Government, or held Government security (meaning Mr. INGERSOLL.) 
 Such proceedings, lie said, made his blood run cold. They required the 
 friends of the Government to unite, to beware how they act, instead of aiding 
 those whose only object was to defeat every act calculated for the defence of 
 the country, &c. 
 
 Mr. ALEXANDER, of Ohio, made a few general remarks as to the readiness 
 with which he should approach this question to reconsider what had been 
 denounced as a rash, desperate, and destructive measure. His remarks were 
 evidently intended to reflect on the observations with which the Speaker had, 
 on the preceding evening, prefaced his vote. He should feel no pain, he said, 
 when acting from his own choice, in giving a vote which was to destroy a ru- 
 inous measure; he should rather rejoice in the opportunity of giving such a 
 vote, and not complain that he did it with pain, &c. 
 
 Mr. M'KEE, of Kentucky, favored the reconsideration of the bill, in the 
 hope that, when reconsidered, it would be recommitted, and its features 
 changed. He had voted for it, in its present shape, with much reluctance; he 
 had so voted, however, because he believed the taxes could not be paid by the 
 people, unless they were aided by the establishment of a medium of general 
 circulation, &c. He did not believe, in its present shape, that the bill would 
 pass, but he did believe it might be so modified as to meet the views of a ma- 
 jority of the House. 
 
 Mr. INGERSOLL, of Pennsylvania, said he should vote fora reconsideration 
 of the bill, because he was of the same opinion to-day that he was yesterday. 
 He was not tenacious as to the plan of it, but a national bank he believed to be 
 indispensable, &c. He took occasion to remark, in allusion to the observa- 
 tion of Mr. HALL, that, although he, with several other gentlemen of the 
 House, possessed a small interest in the public stock, he had no idea that it 
 could disqualify him, or any one else, from voting on this question, any more 
 than on the tax, or any other revenue or loan bills, &c. 
 
 Mr. MACON, of North Carolina, said he should vote against re-considera- 
 tion: for, although he had, of late, uniformly entertained the opinion that it 
 would be convenient and expedient to establish a national bank, he as firmly 
 believed that there was no delegated power in Congress to establish such a 
 
PROCEEDINGS OF 1815. 573 
 
 bank. He had given such votes as he thought calculated to improve or perfect 
 the various bills before the House, but he must, eventually, vote against any 
 bank. Mr. M. concluded his examination of this question, by expressing the 
 opinion that treasury notes would circulate, and obtain as good a credit, as 
 the notes of the bank proposed to be established, and to those the nation 
 must, he believed, at last resort, &c. 
 
 Mr. ROBERTSON, of Louisiana, was in favor of reconsideration, and made an 
 animated appeal to those who were friendly to the establishment of a bank, 
 and yet had opposed this bill because the details did not exactly meet their 
 views. He called upon them to sacrifice their particular prejudices, and not 
 prostrate die public interest at the shrine of their own pricle, or independence 
 of opinion. Scarcely any subject, he said, could come before the House, in 
 regard to which gentlemen might not urge that there were certain of the de- 
 tails which did not meet their approbation, and for which they could not vote. 
 This bill had been called a desperate a dangerous measure. It might be so, 
 Mr. R. said; but, from the nettle danger, we frequently pluck the flower safety. 
 Nothing could be more dangerous than the very situation in which we now 
 are, which could not be worsted even by the failure of the novel experiment 
 which this bill had been pronounced to be, &c. 
 
 Mr. ALSTON, of North Carolina, said he should vote against re-considera- 
 tion. Believing no good could result from further attempts to unite conflict- 
 ing opinions on this subject, he was in favor of putting it to rest, and letting 
 the responsibility rest on the shoulders of those who had twice already defeat- 
 ed the bill, &c. 
 
 Mr. DUVAL, of Kentucky, in advocating a re-consideration, called upon 
 those who had refused to sacrifice their individual opinions, to remember the 
 sacrifices made by those of their own party, and to exhibit that liberality and 
 spirit of mutual concession, without which there could bs no legislation. He 
 believed there was a decided majority in the House in favor of a national 
 bank, and he entreated gentlemen to consent to re commitment, to make one 
 last effort to save the sinking credit of the country, &c. Ha dwelt at some 
 length on the absurdity of every man in a public body clinging to his own 
 opinion as the standard of perfection. Unless men yield occasionally their 
 particular opinions on minor points, and mere matters of detail, no majority 
 could ever be obtained in favor of any particular measure. He had thus yield- 
 ed his opinions when he voted for this bill, and he hoped a sufficient number 
 would now do so to obtain a re-consideration of the bill. 
 
 Mr. GHOLSOV, of Virginia, conjured gentlemen to put an end to debate, and 
 to act. Whilst they were debating, the army was suffering for the want of 
 necessary supplies; the nation was suffering at every point. He intreated 
 gentlemen to permit the question to be taken. 
 
 Mr. HAWKINS, of Kentucky, addressed himself to the majority of the 
 House, exhorted them to unite, and no longer suffer themselves to be driven 
 from ground to ground, from shift to shift, by the pertinacity of a minority 
 who openly disavowed any responsibility for the failure of measures which 
 they were frequently the means of thwarting' He adverted to the majority 
 which, a day or two ago, had appeared in favor of this bill, who had been 
 driven from their ground by the pertinacity of the minority, in violation of the 
 usages and decorum of legislation, c. He appealed, also, to the liberality of 
 those opposed to this bill on mere points of detail, whether an opportunity 
 ought not to be afforded to those who were friendly to the principle to try this 
 question again. He dwelt with much emphasis on the weight of responsi- 
 bility attaching to every one who voted on this question, and the propriety of 
 allowing them to vote again, on a vote on which the House was equally divid- 
 ed, after having an opportunity since to reflect on it. 
 
574 BANK OF THE UNITED STATES. 
 
 Mr. PEARSON expressed himself favorably towards a national bank, but as 
 strongly opposed to the bill now before the House, the vote on which he would 
 not consent to reconsider, lest the bill might then pass, though he was willing 
 to suspend the rule of the House forbidding a bill, once rejected, to be origi- 
 nated anew, so as to give an opportunity to obtain the establishment of a bank 
 on proper banking principles, &c. 
 
 Mr. FISK, of New York, said the very importance of this bill was a reason 
 why a question, decided as it had been, should be reconsidered; that, if a ma- 
 jority should not favor its passage in its present shape, it might be put in such 
 a form as should ensure it the support of a majority. The proposal of the 
 gentleman who preceded him, to dispense with the rule, he considered as 
 more objectionable by far, than the practice of reconsidering a vote. 
 
 Mr. FORSYTH, of Georgia, at some length warmly contended for the recon- 
 sideration of the bill, avowing himself still friendly to it, in preference to any 
 other plan which could be proposed. 
 
 Mr. CALHOUN was in favor of reconsideration of the bill, but on different 
 grounds from Mr. FORSYTH. He was, and should continue, opposed to the 
 present bill. 
 
 Mr. GASTON, Mr. CULPEPER, Mr. WEBSTER, and Mr. GROSVENOR, express- 
 ed themselves friendly to a national bank, on the principles they have hereto- 
 fore advocated, but decidedly opposed to this; and, therefore, determined to 
 vote against reconsidering it, though they were willing to suspend the rule 
 forbidding future reconsideration. 
 
 Mr. WILSON, of Pennsylvania, advocated a reconsideration of the bill, on 
 the grounds of partiality to the form of the present bill, which he examined 
 and supported by a train of argument going to exhibit its particular merits. 
 
 Mr. HALL then said he had made his motion with the hope of obtaining a 
 compromise of conflicting opinions, and a modification of the present bill. 
 But, finding its friends so wedded to it as to attempt to force it through the 
 House, he withdrew his motion for a reconsideration. 
 
 Mr. WEBSTER took this opportunity to lay upon the table the following 
 resolution: 
 
 Resolved^ That the rule of the House which prevents a subject, once acted 
 upon, from being acted upon again, during the same session, be suspended 
 until otherwise ordered. 
 
 Mr. M 4 KiM renewed the motion to reconsider the vote on the bank bill; 
 not from any intention to change his vote, but from a disposition to accommo- 
 date his friends on a question of so much magnitude. 
 
 Mr. SHARP, of Kentucky, opposed, and Mr. NEWTON, of Virginia, advocat- 
 ed the reconsideration; the one, on grounds of unabated hostility to the present 
 bill; the other, from a disposition to afford the utmost latitude to the consider- 
 ation of a subject so highly important to the nation. 
 
 The question on reconsideration was at length decided by yeas and nays. 
 For reconsideration, 107, 
 
 Against it, - 54. 
 
 And the question being again stated: " Shall the bill pass r" 
 
 Mr. M'KEE moved to recommit the bill to a select committee, and present- 
 ed his view of the change which, he conceived, ought to be made in its pro- 
 visions. 
 
 Mr. BUTLER, of Vermont, supported this motion, and, in a speech of some 
 length, exhibited his views on the same subject. 
 
 Mr. FOBSYTH opposed the recommitment with much zeal and eloquence, on 
 grounds of preference to the present bill. 
 
PROCEEDINGS OF 1816 575 
 
 Mr. KING, of Massachusetts, expressed his opinions, generally, in hostility 
 to the establishment of any bank, at that time, and in opposition to any com- 
 promise. 
 
 Mr. FINDLEY advocated the recommitment, principally on the ground of 
 opposition to that feature of the bill which requires the bank to make a loan to 
 Government, which he believed at once superfluous and inexpedient. 
 
 Mr. OAKLEY and Mr. STOCKTON advocated recommitment with earnest- 
 ness and ability, in order to procure a modification of the details. If modi- 
 fied, as they believed it might be, they pledged themselves to vote for the 
 bank bill, and expressed their opinion that, in that vote, they would be join- 
 ed by a majority of their political friends. 
 
 The question on recommitment was decided by yeas and nays, as follows: 
 For recommitment, 89, 
 
 Against it, 71. 
 
 And it was determined to recommit the bill to a select committee of seven 
 members. 
 
 The committee to whom the bill was recommitted, consists of Messrs. 
 M'Kee, Findley, Stockton, Pitkin, Taylor, Cuthbert, and Yancey. 
 
 JANUARY 6, 1815. 
 
 Mr. M'K.EE, from the select committee to whom was recommitted the bill, 
 reported sundry amendments thereto; which were read. 
 
 A motion was then miitU 1 by Mr. ROBERTSON to lay the report on the table 
 for one day, that it might be printed for the more particular information of the 
 members, which motion was negatived: Ayes 36. 
 
 Mr. M'ivEE explained, briefly, the nature and amount of the amendments 
 now proposed to the bill. The first principle introduced into the bill, he said, 
 was a reduction of the capital stock fromjifty to thirty millions: such capital 
 to be composed of five millions in specie, fifteen millions in treasury notes, 
 ten millions in stock of the United States, created since the declaration of the 
 war. The capital to be subscribable in shares of one hundred instead of Jive 
 hundred each. The payments of the subscription to be so apportioned that 
 two fifths of the amount of the capital should be paid in at the time of sub- 
 scribing. This would brin at once into the bank, $1,666,000 in specie, and 
 the residue in treasury notes, and stock, amounting to twelve millions in the 
 whole. There was every reason to believe, that this payment could be made, 
 at the time of subscription, to the full amount proposed. If so, the bank could 
 forthwith go into operation, and its capital would not remain inactive, as a 
 part of it must do if a less amount were payable at the time of subscription. 
 The principle requiring the bank to make a loan of thirty millions to the Go- 
 vernment, to be stricken out, and the provision respecting the suspension of 
 payments in specie, which appeared to be inseparably connected with the 
 compulsory loan, to be also stricken out. The immediate aid which the plan 
 would aftbrd to the Government, in addition to the establishment of a circu- 
 lating medium of undoubted credit, would be in the issue and free circulation 
 of fifteen millions of treasury notes, and the relief to the stock market by the 
 abstraction from it often millions, to be subscribed into the stock of the bank. 
 The bank thus to be established, was predicated on the idea of a specie bank, 
 on which principle alone must forever rest a sound circulating medium. There 
 was no danger, as had been frequently observed, but, without a requisition to 
 that effect in its charter, the bank would, for its own interest, afford to the Go- 
 vernment every assistance and accommodation in its power. A right was 
 also reserved to the Government, to subscribe, on its own behalf, and for its 
 benefit, whenever Congress shall authorize it by law, five millions to the 
 stock of the bank, payaole in certificates of stock, bearing an interest of four 
 
576 BANK OF THE UNITED STATES. 
 
 per centum. This stock it might sell at great advantage; even during the 
 present year, if the bank went successfully into operation. 
 
 JL I1V' C4.111 VAlVlllAV^l J CO LV* HIV U1OU vJV^Vv Vf.VH.1. IJM,*AftJ^ VXWBW M*,WUJ M**M \11\. V|lA\_,k7lWI. 
 
 being proposed to the House on that amendment which reduces the proposed 
 ipital from fifty to thirty millions of dollars, 
 
 The amendments to the first section having been stated, and the. question 
 iing i 
 capital 
 
 Mr. TELFAIR, of Georgia, being desirous of fixing the capital of the bank at 
 forty millions, as a proper medium, said he should vote against this amend- 
 ment, and briefly assigned his reasons for so doing. 
 
 Mr. HAWKINS, of Kentucky, stated the reasons why he should vote against 
 this amendment, though willing to make what he deemed reasonable conces 
 sions to those who differed from him. 
 
 Mr. TAYLOR explained, at some length, the reasons which had induced him, 
 as a last effort to relieve the finances of the country, by the establishment of a 
 bank, to consent to this report, embracing a compromise of his own opinions. 
 He spoke at some length, in explanation of the provisions of this bill, and of 
 the advantage which it held forth to the public interest. 
 
 Mr. FORSYTH briefly stated the grounds on which he was opposed to the re- 
 port of the committee, and preferred the bill in its present shape. If the 
 amendments prevailed, he contended that the will of the majority would in 
 fact be defeated, and a bill passed on a plan, of which the majority had al- 
 ready expressed their decided disapprobation. 
 
 Mr. M'KEE spoke at some length in defence of the report, and to shew its 
 superiority to the present features of the bill. 
 
 Mr. INGERSOLL explained briefly why, although entertaining a decided pre- 
 ference for the bill, as it now stood, he should vote for the report of the com- 
 mittee in all its parts; because, being the result of a compromise, if it were not 
 accepted, he feared no National Bank would be established a measure which 
 he deemed at this moment absolutely indispensable. 
 
 Mr. YANCEY said, he should give the report his decided support, and re- 
 gretted that any of his friends should act differently. He considered the pro- 
 posed amendments highly expedient, and, withal, that, if they were not adopt- 
 ed, no bank could be established at this session. 
 
 Mr. PITKIN, in a speech of some length, explained the reasons why he had 
 been induced to compromise a part of his own opinions, in agreeing to this re- 
 port, to which he had acceded with some reluctance, and for the success of 
 which he did not consider himself responsible. Being willing to lend his aid 
 to extricate the Government from its present financial difficulties, he had 
 agreed to this report, which, however, he believed, embraced much too ex- 
 tensive a scale for the proposed institution. He went into an examination at 
 some length of the principles of banking, principally to shew that a forced 
 loan would be destructive to the ability or prospects of any bank. 
 
 Mr. FORSYTH replied at some length to some of the objections which had 
 been made to the bill as it now stands, and in vindication of his own opinion; and 
 
 Mr. PEARSON added a few words of explanation in reply to a part of Mr. 
 FORSYTH'S speech. 
 
 The question being taken, after nearly two hours' debate, on the first amend- 
 ment reported by the select committee, (substituting thirty for fifty millions) 
 was decided as follows: 
 
PROCEEDINGS OF 1815. 
 
 57? 
 
 Those who voted in the.affirmative, are, 
 
 Messrs. Alexander, 
 
 Messrs, Findley, 
 
 Messrs. Pickens, 
 
 Anderson, 
 
 Forney, 
 
 Pitkin, 
 
 Archer, 
 
 Gaston, 
 
 Pleasants, 
 
 Barbour, 
 
 Geddes, 
 
 Potter, 
 
 Bard, 
 
 Gholson, 
 
 J. Reed, 
 
 Barnett, 
 
 Grosvenor, 
 
 W. Reed. 
 
 Baylies, of Mass. 
 
 Hanson, 
 
 Rea,ofPa. 
 
 Bayly, of Va, 
 
 Harris, 
 
 R-hea, of Tenn 
 
 Bigelow, 
 
 Hasbrouck, 
 
 Rich, 
 
 Bines, 
 
 Hawes, 
 
 Robertson, 
 
 Bowen, 
 
 Henderson, 
 
 Huggles, 
 
 Boyd, 
 
 Howell, 
 
 Sage, 
 
 Bradbury, 
 
 Humphreys, 
 
 Schureman, 
 
 Breckenridge, 
 Brig.iam, 
 
 Hulbert, 
 Ingersoll, 
 
 Seybert, 
 Sharp, 
 
 Bunvell, 
 
 Irving, 
 
 Sheffey, 
 
 Butler, 
 
 Jackson, of R.J[. 
 
 Sherwood, 
 
 Caperton, 
 
 Jackson, of Va 
 
 Shipherd, 
 
 Calhoun, 
 Cannon, 
 
 Johnson, of Va 
 Johnson, of Ky. 
 
 Slaymaker, 
 Smith, of N. V. 
 
 Champion,- 
 
 'Kennedy, 
 
 Smith, of Penn 
 
 Chappell, 
 
 Kent, of N. V 
 
 Stanford, 
 
 Cilley, 
 
 Kent, of Md. 
 
 Stockton, 
 
 Clark, 
 
 Kerr, 
 
 Stuart, 
 
 Clendenin, 
 
 Kershaw, 
 
 Sturges, 
 
 Clopton, 
 
 King, of M 
 
 Taggart, 
 
 Comstock, 
 
 King, of N. C. 
 
 Tannehill, 
 
 Coxe, 
 
 Law, 
 
 Taylor, 
 
 Crawford, 
 
 Lovett, 
 
 Thompson, 
 
 Creighton, 
 
 JLowndes, 
 
 Troup, 
 
 Crouch, 
 
 M'Kee, 
 
 Udree, 
 
 Culpeper, 
 
 M'Kim, 
 
 Vose, 
 
 Cuthbert, 
 
 M'Lean, 
 
 Ward, of Mass 
 
 Dana, 
 
 Miller, 
 
 Ward, of N. J 
 
 Davenport, 
 
 Montgomery, 
 
 Webster, 
 
 Davis, of Mas*. 
 
 Moore, 
 
 Wheaton, 
 
 Davis, of Penn. 
 
 Moseley, 
 
 White, 
 
 Desha, 
 
 Markefl, 
 
 Wilcox, 
 
 Duval, 
 
 Newton, 
 
 Williams, 
 
 Earl, 
 
 Oakley, 
 
 Wilson, of Ma*. 
 
 Ely, 
 
 Ormsby, 
 
 Winter, 
 
 Evans, 
 
 Pearson, 
 
 Wood, and 
 
 Farrow, 
 
 Pickering, 
 
 Yancey129. 
 
 Those who voted in the 
 
 negative, are, 
 
 
 Messrs. Alston, 
 
 Messrs. Griffin, 
 
 Messrs. Macon, 
 
 Brown, 
 
 Hall, 
 
 M'Coy, 
 
 Caldwell, 
 
 Hawkins, 
 
 Murfree, 
 
 Conard, 
 
 Hopkins, of Kv. 
 
 Nelson, 
 
 Denoyelles, 
 
 Hubbard, 
 
 Parker, 
 
 Eppes, 
 
 Ingham, 
 
 Ringgold, 
 
 Fisk, of Vt. 
 
 Irwin, 
 
 Roane, 
 
 Fisk, of N. Y. 
 
 Kilboum, 
 
 Sevier, 
 
 Forsyth, 
 
 Lefferts, 
 
 . Telfair, and 
 
 Franklin, 
 
 Lyle, 
 
 Wilson, of Pa. 31 
 
 Gourdin, 
 
 
 
 The other amendments, as indicated above in Mr. M'KEE'S remarks, were 
 then all agreed to among them being an amendment to postpone the opening 
 of the books of subscription to the last instead of the second Monday in Fe- 
 bruary. 
 
578 BANK OF THE UNITED STATES. 
 
 A motion was made by Mr. GASTON, further to amend the bill, by striking 
 out that part of the amendment describing the (war) stock which shall be sub- 
 scribable to the Bank, and inserting, in lieu thereof, " or in any of the public 
 debt of the United States, drawing an accruing interest of six |>er centum, 
 per annum, contracted or to be contracted by virtue of any act of Congress;'* 
 which motion was negatived. 
 
 The bill, as amended, was then ordered, without a division, to be read a third 
 time to-morrow, 
 
 JANUARY 7, 1815. 
 
 The engrossed amendments to the bill were read, and the question stated, 
 " Shall this bill pass as amended?" and the yeas and nays thereon having 
 been required by Mr. STANFORD: 
 
 Mr. FISK, of New York, rose to assign the reasons which now influenced 
 him to vote against this bill. His objections were, to the reduction of the ca- 
 pital, and to the omission of what had been miscalled the forced loan feature of 
 the bill, which he considered one of the best. The bill, before it was amend- 
 ed, would, he said, have afforded to the Government, a benefit to the amount 
 of twenty millions, but now would not afford to it a greater bonus than three 
 millions. He objected to the amendments which had taken from the bill the 
 control which the Government ought to have over it, and would throw 
 the Government and the moneyed resources of the nation into the power of its 
 political adversaries. There were also other features of the bill to which he 
 objected, so strongly, upon the whole, that he would not vote for the bill. 
 
 Mr- HANSON of Maryland, expressed his regret to see any impediment 
 thrown in the way of the bill. He expressed all the satisfaction he felt at be- 
 ing able on this occasion to redeem his pledge to co-operate with the majority, 
 in any measure which he could hope or bslieve would be beneficial to the na- 
 tion. This bill y in its present shape, he remarked, was the result of a com- 
 promise, produced by mutual and magnanimous concessions, and at a period 
 like this, of bitter polictial animosity, concessions reflecting equal honor on 
 both sides of the House. 
 
 Mr. GROSVENOR, of New York, assigned, at some length, the reason why he 
 should vote against the bill. He expressed, in a feeling manner, his regret at 
 being compelled to vote, on this occasion, against so many of those with whom 
 he had heretofore acted in opposition to the measures of this administration. 
 His objections were more to the time when, and purposes for which* a bank is 
 to be established, than to the features of this bill; to some of which he object- 
 ed. He denied that it could be a specie bank, or that the bank would ever 
 be able to get a million of its notes into circulation. The Government rely- 
 ing upon it would be disappointed, and ruin soon stare them in the face. He 
 denied the operation upon himself, of the argument that this was a lesser evil 
 than what might be substituted for it if it did not pass. He would not, he said, 
 embrace this evil, in order to avoid a greater, which might not happen; he 
 would never, he said, adopt a principle, looking towards that which imports, 
 that the end may justify the means. 
 
 Mr. TELFAIR, of Georgia, stated the reasons why, although he decidedly 
 approved of the bill which had been first before the House, he should yet vote 
 for this bill. He was seriously convinced, he said, that, under the present em- 
 barrassment of our circulating medium, and of the fiscal concerns of the na- 
 tion, a bank was indispensable; and, though the system now before the 
 House was one, the details of which he could not approve, he would vote for 
 it as a last resort. He frankly intimated his hope, that the other House would 
 propose some modification of the amendments of this House, that would ren- 
 der the compromise of opinion more equitable than as it now stood. Mr. T. 
 went into a general examination of the principles and history of banking, 
 
PROCEEDINGS OF 1815. 579 
 
 principally to shew that banks founded on the credit of Governments, and on 
 public stocks, h^d not been as generally unsuccessful as had been contended; 
 and he then compared the present system with that which came from the Se- 
 nate, to the latter of which he gave a decided preference. 
 
 Mr. INGHAM, of Pennsylvania, believed, he said, a National Bank to be es- 
 sentially necessary, to give relief to the present embarrassed state of things. 
 Believing this bill would contribute, in some degree, to relieve the national 
 wants, it would receive his vote, though reluctantly; and he wished it to be 
 distinctly understood, that, instead of its being a preferred measure, he con- 
 sidered the first bill as more efficient, and calculated to give the Govern- 
 ment aU it wanted. The vote of the House this day, he said, would be no 
 test of the excellence of this system, or even of the approbation of it by the 
 House; the question being whether the House would take this or no bank. 
 Mr. I. made a statement of the comparative advantages and disadvantages of 
 the two plans, giving the decided superiority to the original plan, &c. 
 
 The question on the final passage of this bill was then decided as follows: 
 Those who voted in the affirmative, are, 
 
 Messrs. Alexander, 
 Alston, 
 Anderson, 
 Barnett, 
 Bayly, of Va. 
 Big-clow, 
 Bines, 
 
 Breckenridge, 
 Brigham, 
 Brown, 
 Butler, 
 Caperton, 
 Caldwell, 
 Calhoun, 
 Cannon, 
 Champion, 
 Chappell, 
 Cilley. 
 Clark, 
 Clendenin, 
 Comstock, 
 Conard, 
 Cooper, 
 Coxe, 
 Creighton, 
 Crouch, 
 Culpeper, 
 Cuthbert, 
 Dana, 
 Davenport, 
 Davis, of Mass. 
 Davis, of Pa. 
 Duvall, 
 Earle, 
 Ely, 
 Farrow, 
 Findley, 
 Fisk, of Vt. 
 Forney, 
 Forsyth, 
 
 Messrs. Gaston, 
 Geddes, 
 Gholson, 
 Hale, 
 Hanson, 
 Harris, 
 Hasbrouck, 
 Hawes, 
 Hawkins, 
 Henderson, 
 Hopkins, of Ky. 
 Howell, 
 Hungerford, 
 Hulbert, 
 Ingersoll, 
 Ingham, 
 Irving-, 
 
 Jackson, of R. 1. 
 Kent, of N. Y. 
 Kent, of Md. 
 Kerr, 
 Kershaw, 
 Kilbourn, 
 King, ofN. C. 
 Lefferts, 
 Lovett, 
 Lowndes, 
 M'Coy, 
 M'Kee, 
 M'Kim, 
 M'Lean, 
 Montgomery, 
 Moore, 
 Moseley, 
 Markell, 
 Oakley, 
 Ormsby, 
 Pearson, 
 Pickering, 
 Pickens, 
 
 Messrs. Pitkin, 
 
 Pleasants, 
 
 Potter, 
 
 John Reed, 
 
 Win. Reed, 
 
 Rea, of Penn. 
 
 Rhea, of Tenn. 
 
 Rich, 
 
 Ringgold, 
 
 Robertson, 
 
 Ruggles, 
 
 Sage, 
 
 Schureman, 
 
 Sevier, 
 
 Sharp, 
 
 Sheffey, 
 
 Sherwood, 
 
 Shipherd, 
 
 Slaymaker, 
 
 Smith, ofN. Y. 
 
 Smith, of Penn, 
 
 Stockton, 
 
 Stuart, 
 
 Sturges, 
 
 Taggart, 
 
 Tannehill, 
 
 Taylor, 
 
 Telfair, 
 
 Thompson, 
 
 Udree, 
 
 Vose, 
 
 Ward, of Mass. 
 
 Ward, of N. J. 
 
 Webster, 
 
 Wheaton, 
 
 White, 
 
 Williams, 
 
 Winter, 
 
 Wood, 
 
 Yancey. 120. 
 
580 BANK OF THE UNITED STATES. 
 
 Those who voted in the negative, are, 
 
 Messrs. Baylies, of Mass. Messrs. Griffin, Messr?. Murfree* 
 
 Boyd, Grosvenor, Nelson, 
 
 Bradbury, Hubbard, Newton, 
 
 Burwell, Humphreys, Parker, 
 
 Clopton, Irwin, Roane, 
 
 Crawford, Johnson, of Va. Seybert, 
 
 Denoyelles, Johnson, of Ky. Stanford, 
 
 Desha,. Kennedy, Strong-, 
 
 Eppes r King, of Mass. Wilcox, 
 
 Evans, Law, Wilson, of Mass. 
 
 Fisk, of N. Y. Lewis, Wilson, of Pa. 37 
 Franklin, Lyle, 
 Gourdin, Maeon, 
 
 So the bill was passed, and the amendments sent to the Senate for their 
 concurrence. 
 
 IN SENATE. 
 
 JANUARY 9, 1 81 5. 
 
 Ordered* That the bill and amendments from the House of Representatives, 
 be referred to a select committee, and Messrs. Smith^Bibb, Anderson, Giles, 
 and Varnum, were appointed the said committee. 
 
 JANUARY 13, 1815. 
 
 Mr. SMITH, from the said committee, reported the bill with a number of 
 amendments. 
 
 [The amendments to the amendments of the House, propose to increase 
 the fixed capital of the bank from thirty to thirty -Jive millions of dollars; to 
 make the capital consist of shares of four hundred instead of one hundred 
 dollars each; that the five millions proposed to be added to the capital, shall 
 be added also to the amount subscribable in public debt; to disagree to the 
 proposition of the House for striking out the section which authorizes suspen- 
 sion of payments in specie; to agree to the section which compels the bank to 
 commence its operations before the first day of January, and to disagree to 
 that which proposes to authorize a committee of Congress, at any time, to ex- 
 amine the books, &c. and prescribes the course of proceeding in the courts 
 against the bank, in case of violation of its charter.] 
 
 The consideration of this report was postponed to, and made the order of 
 the day for, to-morrow. 
 
 JANUARY 14, 1815. 
 
 The Senate resumed the consideration of the report of their select commit- 
 tee, on the amendments received from the House of Representatives. 
 
 On the proposition to make the fixed capital of the bank thirty -Jive, (instead 
 of thirty millions, as proposed by the House) there were, 
 
 For the increase Messrs. Anderson, Barbour, Bibb, Chase, Condlt, Giles, Kerr, La- 
 cock, Morrow, Roberts, Smith, Tait, Taylor, Turner, Varnum, Walker, Wharton 17 
 
 JJgainst it Messrs. Brown, Daggett, Dana, Fromentin, Gaillard, German, Gore, 
 Horsey, Hunter, King, Lambert, Mason, Thompson, Wells 14, 
 
 On the proposition to increase by five millions the amount of public debt 
 on war stock, to be subscribable to the bank, the vote was precisely the same 
 as the above. 
 
 After making further progress in the discussion, the Senate adjourned be- 
 fore they had gone through the bill. 
 
PROCEEDINGS OF 1815. 
 
 JANUARY 16, 1815. 
 
 The Senate were engaged nearly the whole of the day on the amendments 
 to the bill; which subject they finished just before adjournment. They agreed 
 to the amendments of the House, amended by increasing the capital five mil- 
 lions, so as to make it thirty-five, and reinstating the section to authorize the 
 bank, in case of necessity, to suspend payment in specie. 
 
 JANUARY 17, 1815. 
 
 The Senate resumed the consideration of the subject of the bill. 
 
 Various questions relating to the amendments and re-amendments to the 
 same, were decided by the yeas and nays; among which was the following: 
 
 On the question to reinstate in the bill the section authorizing a suspension* 
 in certain cases, of payment in specie by the bank, (which section was strick- 
 en out by the House of Representatives) the votes were as follow: 
 
 For retaining the section Messrs. Anderson, Barbour, Bibb, Chase, Condit, Howell, 
 Lacock, Morrow, Roberts, Robinson, Smith, Tait, Taylor, Turner, Varnum, Walker, 
 Wharton 17. 
 
 Against it Messrs, Brown, Daggett, Dana, Fromentin, Gaillard, German, Giles, 
 Gore, Horsey, Hunter, Kerr, King 1 , Lambert, Mason, Thompson, Wells 16. 
 
 The Senate having then agreed to some, and disagreed to others of the 
 amendments of the House, the same were returned to tne House. 
 
 HOUSE OF REPRESENTATIVES. 
 
 JANUARY 17, 1815. 
 
 A motion was made by Mr. INGIIAM, of Pennsylvania, that the . maining 
 orders of the day be then postponed until to-morrow, in order to fc.k * up the 
 message this morning received from the Senate respecting their d v ision on 
 the amendments to the national bank bill; which motion was negat : v -d by the 
 following vote: 
 
 For the motion, - 71, 
 
 Against it, 73. 
 
 JANUARY 18, 1815. 
 
 The House resumed the consideration of the message from the Senate, an- 
 nouncing their amendments to the amendments of this House to the bill. 
 
 The first amendment having been stated, which proposes to make the capi- 
 tal of the bank thirty-five millions instead of thirty millions 
 
 Mr. M*KEE, of Kentucky, expressed his hope that the amendment would 
 not be agreed to, considering it as the key-stone of all the amendments of the 
 Senate. He could see no possible advantages to result from the addition of 
 five millions of capital, particularly as connected with the section authorizing 
 the stoppage of payment in specie. He could see no consequence to result 
 from that clause, which was not disastrous and ruinous, &c., and he therefore 
 hoped it would not be agreed to. 
 
 Mr. HAWKINS, of Kentucky, denied the applicability of the remarks of Mr. 
 M'KEE to the amendments of the Senate. The only question, since the Se- 
 nate had agreed to expunge the condition of a permanent loan to the Govern- 
 ment, was. whether the Senate should be accommodated by increasing the 
 capital of me bank by the addition thereto of five millions: for, in fact, the 
 retention of the clause authorizing the suspension of specie payment was im- 
 material, unless that it is more expedient to incorporate such a provision at 
 once, than yield it to the importunity of the bank hereafter. For he had no 
 doubt, if the war continued, the bank must, sooner or later, suspend specie 
 
582 BANK OF THE UNITED STATES. 
 
 payment even the banks of Kentucky and Ohio (where specie abounded) 
 had at length been compelled, in self-defence, to stop payment of specie. 
 The advantage to Government, in the proposed amendment, Mr. H. argued, 
 would be found in the taking out of the market so much more of the war stock, 
 &c. Something, he contended, was due to the Senate, in the spirit of accom- 
 modation which that body had exhibited in yielding so far to the wishes of the 
 House, as to accept the greater part of the amendments and particularly, 
 inasmuch as, in several cases of difference with that body, the House had ex- 
 hibited much pertinacity in adhering to its peculiar opinions, &c. &c. He 
 treated, as altogether ideal, the argument of danger to the existence of the 
 republic, from the refusal to incorporate a bank. He had, he said, higher 
 opinions of the destinies of this Government, and of its durability and ability 
 to overcome every difficulty; opinions which gained ground by every day's 
 experience, &c. &c. 
 
 Mr. STOCKTON, of New Jersey, rose to say, that he, and those with whom 
 he had acted, in the concessions they had made relative to the features of the 
 bank bill, had gone as far as they could go, and further than they had origi- 
 nally intended, in order to conciliate with gentlemen on the other side of the 
 House. After they had done this, it could not be expected, he said, that they 
 should recede. He wished it, therefore, to be understood, that, whilst he 
 should be happy to pay all due respect to the other branch of the Legislature, 
 it could not be expected that they should yield up to them their honest con- 
 victions; and, therefore, that they could not yield their assent to the amend- 
 ments of the Senate. 
 
 Mr. WRIGHT, of Maryland, made a speech of some length, expressive of 
 his hope that a spirit of accommodation would have induced the House at 
 once to have acceded to the amendmen.s of the Senate, which he deemed ad- 
 vantageous. He considered it particularly important, that a provision should 
 exist to prevent the agents or friends of the enemy from drawing all its specie 
 from the vaults of the bank. The state of war, he considered as changing 
 essentially the usual state of mercantile operations, and requiring from the 
 banks a suspension of payments in specie. He concluded his speech with the 
 following quotations from legal authorities Inter arma silent leges; necessi- 
 tas non nabet legem. 
 
 Mr. GROSVENOR, of New York, after remarking that he felt not at all en- 
 cumbered by the stipulations of compromise, inasmuch as he was not a party 
 to it, having voted against the bill, proceeded to assign the reasons why he 
 should vote for this amendment. He found himself obliged to do so from a 
 regard to his own consistency: for, though he doubted of the efficacy of any 
 bank that could be established, he was pretty certain that the plan of the bank 
 would be improved by the addition to its capital as proposed by the Senate. 
 
 Mr. FORSYTH, of Georgia, advocated, at some length, the adoption of the. 
 amendments of the Senate. He believed the addition of five millions to the 
 capital of the bank would operate as a benefit to the Government, by taking 
 so much of the stock put of the market, &c. He denied the necessity, or 
 even the propriety, of any part of the House sacrificing their views of the na- 
 tional interest to any ideas of compromise or conciliation. At least, he dis- 
 claimed, for himself, the operation of any such consideration on him. 
 
 Mr. CUTIIBERT, of Georgia, made a speech of some length against the amend- 
 ments of the Senate. He considered them as inseparably connected with each 
 other, and being so, he was altogether opposed to them. To the amendment 
 now under consideration, he was particularly opposed, because, by extending 
 the quantity of war stock to be purchased, the ability to purchase treasury 
 notes would be so far diminished, and the immediate benefits to the Govern- 
 ment so tar curtailed. Mr. C. also dwelt with some emphasis on the pro- 
 priety of carrying into effect, in good faith, the compromise, by the aid of 
 
PROCEEDINGS OF 1815. 
 
 which the bill had passed this House in the form in which it had been return- 
 ed to the Senate, &c. 
 
 Mi. FORSYTH denied the operation on him of the compromise alleged to 
 have taken place in regard to this question. He was no party to it, and 
 was ignorant of its terms. If the agreement had been in writing* lie should 
 like to see the names signed to it, to know who it was that was willing to bind 
 the solid interests of the country as a propitiatory sacrifice on the altar of con- 
 ciliation. 
 
 [Considerable further debate took place on this amendment, in the course 
 of which Mr. HAWKINS, of Ken., Mr. TELFAIR, of Geo., Mr. RHKA, of Tenn., 
 and Mr. ALSTON, of N. C., denied the authority of the compromise alleged to 
 have taken place on a former occasion; which was, on the other hand, assert- 
 ed by Mr. CUTHBERT and Mr. OAKLEY, and incidentally by Mr. M'KEE. 
 The first named gentleman supported the amendment, and the latter opposed 
 the amendment. Mr. HAWKINS, in the course of his speech, took occasion 
 to pay a high tribute to the talents and independence of the present Secretary 
 of the Treasury, of which lie challenged a denial.] 
 
 Mr. FORSYTH, in conclusion of the debate, by way of disproving the obli- 
 gation of the republican to conciliate the federal side of the House, on any 
 question affecting the national bank, quoted the yeas and nays on the question 
 of reconsideration of the bill, (after it had been rejected by the casting vote of 
 the Speaker) from which it appeared that, of the fifty-four who voted against 
 reconsideration, but &/./: belonged to the republican side of the Hou 
 
 The question on concurrence in the first amendment of the Senate, was 
 finally decided in the negative, by yeas and nays, as follow^: 
 
 For the amendment, - - 80, 
 
 Against it, - - 87. 
 
 The other material amendments were also disagreed to, after debate. 
 Among others, was the amendment going to reinstate the section suspend- 
 ing payment in specie; on which the vote was as follows: 
 
 For reinstating it, - 80, 
 
 Against it, .... 85. 
 
 So the House refused to reinstate that section. 
 
 The House, after agreeing to some other amendments, determined to insist 
 on those of their amendments to which the Senate had disagreed, and ordered 
 the bill to be returned to the Senate. 
 
 IN SENATE. 
 
 JANUARY 19, 1815. 
 
 The Senate proceeded to the consideration of the message from the House, 
 announcing its disagreement to the amendments of the Senate. 
 
 [The state of this question is so intricately interwoven with matters of form, 
 and technicalities, that we shall, in describing the question which came up ^ 
 to-day, disregard the mere form of them, and endeavor to present our readers ^ 
 with the substance.] 
 
 The first question was, the proposition sent from the Senate, to which the 
 House had disagreed, to increase the capital of the bank, five millions, to be 
 subscribable in public stock created since the war. 
 
 On this proposition, Mr. BIBB proposed to insist. 
 
 This motion was supported by Mr. BIBB, Mr. SMITH, Mr. ROBERTS, and 
 Mr. TAYLOR, and opposed by Mr. BARBOUR, Mr. KING, and Mr. GILES. 
 The debate turned principally on the merits of the specie-payment-suspending 
 section, (to which also the other House had disagreed) which was considered 
 as intimately connected with the question immediately before the Senate. 
 
584 BANK OF THE UNITED STATES. 
 
 The first named gentlemen insisted on the advantages to the Government- 
 from the increase oi the capital, and also from the proposed power to suspend 
 payment in specie, without which, it was said, the operations of the bank 
 must, for some time at least, be greatly restricted, &c. and wholly useless to 
 the Government. Mr. BIBB, Mr. ROBERTS", and Mr. TAYLOR intimated, if 
 the Senate should yield these points to the House, that they should vote for the 
 indefinite postponement of the bill, under the impression that it would be rather 
 an injury, than a benefit to the community, to pass it in its present shape. 
 
 Messrs. BARBOUR, KING, and GILES, urged the recession of the Senate from 
 these amendments, principally on the ground of necessary concession, (al- 
 though the two latter gentlemen objected to them on principle also) conces- 
 sions which it was said the times now more than ever demand. Mr. BAR- 
 BOUR, particularly, in an eloquent manner, enforced the necessity of acting 
 decisively on a subject, which had been so long pending between the two 
 Houses, and so greatly interested the feelings of the community, which turned 
 its eyes with ceaseless anxiety on the dilatory proceedings of Congress. Mr. 
 SMITH, in allusion to these remarks, took occasion to absolve the Executive 
 and Senate from the blame of delay and apathy, and by inference to cast it on 
 the shoulders of the House of Representatives. 
 
 The question being about to be taken, Mr. ROBERTS moved to postpone the 
 subject till to-morrow, with the view of submitting a resolution that Mr. 
 BLEDSOE (the Kentucky Senator) was entitled to a seat in Senate, inasmuch 
 as the election of his successor, Mr. TALBOT, had not yet been notified to the 
 Senate. This motion was negatived, 25 to 9, by yeas and nays. 
 
 The question to insist on the first amendment, as stated above, was then de- 
 cided as follows: 
 
 For insisting . Messrs. Anderson, Bibb, Chase, Condit, Howell, Lacock, Morrow, 
 Roberts, Smith, Taylor, Turner, Varnum, Walker. 13 
 
 Against insisting. Messrs. Barbour, Brown, Dag-gelt, Dana, Fromentin, Gaillard, 
 German, Giles, Goldsboroug-h, Gore, Horsey, Hunter, Kerr, King-, Lambert, Mason, 
 Robinson, Tait, Thompson, Wells, Wharton. 21. 
 
 So the Senate refused to insist on this amendment. 
 
 Mr. GILES moved to recede from the said amendment. 
 
 Mr. ROBERTS then moved to postpone the further consideration of the whole 
 subject to the second Monday in March, (equivalent to a motion to reject.) 
 In support of the motion, Mr. ROBERTS spoke at some length. 
 
 Mr. BIBB intimated that he should vote against the postponement now, be- 
 cause the amendment respecting which he was most anxious, had not been de- 
 cided, (meaning the section respecting specie payments.) 
 
 Mr. TAYLOR said he should vote for the postponement, because he perceiv- 
 ed the amendment referred to by Mr. BIBB, would not be insisted on. 
 
 The question on the postponement (or rejection) was then decided as fol- 
 lows: 
 
 For the postponement. Messrs. Gaillard, German, Kerr, Lacock, Lambert, Roberts, 
 . Taylor, Turner, Varnum. 9. 
 
 Against the postponement. Messrs. Anderson, Barbour, Bibb, Brown, Chase, Con* 
 dit, Dagg-ett, Dana, Fromentin, Giles, Goldsborough, Gore, Horsey, Ho well, Hunter, 
 King 1 , Mason, Morrow, Robinson, Smith, Tait, Thompson, Walker, Wells, Whar- 
 ton. 25. 
 
 The question on Mr. Giles's motion, to recede from the said first amend- 
 ment, was then decided in the affirmative, ayes 18. 
 
 Mr. KING then moved to recede from all the other amendments to which 
 the House had disagreed. 
 
 The Senate then receded from such of the said remaining amendments as 
 preceded the following: 
 
PROCEEDINGS OP 1815, 535 
 
 The question on receding from the insertion of the section authorizing the 
 bank, under certain circumstances, to suspend payment of their notes in spe- 
 cie, was decided as follows: 
 
 For receding. Messrs. Barbour, Brown, Dagg-ett, Dana, Fromentin, Gaillard, Ger- 
 man, Giles, Goldsboroug-h, Gore, Horsey, Hunter, Kerr, King, Lambert, Mason, 
 Thompson, Wells. 18. 
 
 Against receding .Messrs. Anderson, Bibb, Chace, Condit, Howell, Lacock, Mor- 
 row, Roberts, Robinson, Smith, Tait, Taylor, Turner, Varnum, Walker, Wharton. 
 16. 
 
 So the Senate virtually disagreed to the insertion of such a section. 
 Whereupon, 
 
 Mr. BIBB moved to postpone, to the second Monday in March, (to reject) 
 the further consideration of this bill. 
 
 Mr. SMITH, then, expressing a desire to have a night's reflection on this 
 question, moved to adjourn. 
 
 There were nineteen yeas in favor of the motion: and the Senate adjourned 
 at a late hour. 
 
 JANUARY 20. 
 
 The Senate resumed the consideration of the amendments to the bill. 
 
 The question on Mr. BIBB'S motion, to postpone to the 2d Monday in March, 
 (to reject) the further consideration of the subject, being yet under conside- 
 ration, a very able and highly interesting debate took place, in the course of 
 which Mr- BIBB. Mr. TAYLOR, and Mr. ROBF.RTS, supported the affirmative, 
 and Mr. GILES tne negative side. 
 
 The question was decided at a late hour, as follows: 
 
 For postponement. Messrs. Anderson, Bibb, Condit, Gaillard, Howell, Kerr, La 
 cock, Morrow, Roberts, Smith, Taylor, Turner, Varnum, Walker. 14. 
 
 Against postponement. Messrs. Barbour, Brown, Chase, Daggett, Dana, Fromen- 
 tin, German, Giles, Goldsboroug-h, Gore, Horsey, Hunter, King-, Lambert, Mason, 
 Robinson, Tait, Thompson, Wells, Wharton. 20. 
 
 So the Senate refused to postpone the bill. 
 
 On motion of Mr. GILES, the Senate then determined to recede from its 
 disagreement with the House; and 
 The Senate adjourned. 
 
 The bill, as passed by both Houses, is as follows, to wit : 
 AN ACT to incorporate the subscribers to the Bank of the United States of America. 
 
 Be it enacted by the Senate and House of Representatives of the United 
 States oftfmfrica in Congress assembled, That a Bank of the United States 
 of America shall be established, the capital stock of which shall be thirty mil- 
 lions of dollars, divided into three hundred thousand shares, of one hundred 
 dollars each share; and that subscriptions for thirty millions of dollars, to- 
 wards constituting the said capital stock, shall be opened, on the last Monday 
 of February next, at the following places, viz: at Portland, in Maine, Ports- 
 mouth, in New Hampshire, Windsor, in Vermont, Boston, Providence, New 
 Haven, New York, New Brunswick, in New Jersey, Philadelphia, Balti- 
 more, the city of Washington, Richmond, Raleigh, Charleston, Savannah, 
 Lexington, in Kentucky, Nashville, in Tennessee, Chillicothe, in Ohio, and 
 New Orleans, under the superintendence of the following persons, as com- 
 missioners to receive the same: at Portland, Matthew Cobb, Isaac Ilsley, 
 Joshua Wingate, junior; at Portsmouth, John Goddard, Nathaniel A. Haven, 
 Henry S. Langdon; at Windsor, Elias Lyinan, William Leveret, Eleazer 
 May; at Boston, Israel Thorndike, Thomas H. Perkins, William Gray, Aa- 
 74 
 
586 ANK OF THE UNITED STATES. 
 
 roil Hill, Samuel Brown; at Providence, Seth Wheaton, Ebenezer K. Dex- 
 ter, Henry Smith; at New Haven, Abraham Bishop, William W. Woolsey, 
 Henry Jones; at New York, Robert Troup, William Paulding, junior, 
 Robert Lenox, John Jacob As tor, Samuel Tooker, Isaac Bronson, Henry A. 
 
 Coster; at New Brunswick, James Vanderpool, John Bray, Peter Gordon: 
 
 ^ A. r*l '1111* T l 11 rr^i m -mT*ii" r^ t I ^-^ *-* i 
 
 at Savannah, John Bolton, Charles Harris, James Johnson; at Lexington, in 
 Kentucky, Charles Wilkins, Lewis Sanders, John H. Morton; at Nashville, 
 Robert Weakly, Felix Grundy, John R. Bedford; at Chillicothe, Samuel 
 Finley, Thomas James, William M'Farland; at New Orleans, Dominick 
 A. Hall, Benjamin Morgan. Paul Lanuse, Thomas L. Harman, and William 
 Flood: which subscriptions shall continue open every day, from the time of 
 opening the same, from ten o'clock in the forenoon, until four o'clock in the 
 afternoon, until the Saturday following, at four o'clock in the afternoon, when 
 the same shall be closed; and immediately thereafter, the commissioners, or 
 any two of them, at the respective pi aces aforesaid, shall cause two transcripts 
 or fair copies of such subcnptions to be made, one of which they shall send to 
 the Secretary of the Treasury, one they shall retain, and the original shall, 
 within three days from the closing of the same, be by the said commissioners 
 transmitted to the said commissioners at Philadelphia, or to one of them; and 
 on the receipt thereof, the said commissioners at Philadelphia, or any three of 
 them, shall immediately thereafter convene and proceed to take an account 
 of the said subscriptions; and if more than the amount of thirty millions of 
 dollars shall have been subscribed, then the said last mentioned commissioners 
 shall apportion the same among the several subscribers, according to their 
 several and respective subscriptions: Provided however, That such commis- 
 sioners shall, by such apportionment, allow and apportion to each subscriber 
 at least one share; and, in case the aggregate amount of the said subscriptions 
 shall exceed thirty millions of dollars, the said commissioners, after having 
 apportioned the same as aforesaid, shall cause lists of the said apportioned 
 subscriptions to be made out, including in each list the apportioned subscrip- 
 tion for the place where the original subscription was made, one of which lists 
 shall be transmitted to the commissioners, or to one of the commissioners, 
 under whose superintendence such subscriptions were originally made, that 
 the subscribers may ascertain from them the number of shares apportioned to 
 such subscribers, respectively; and, if the amount of thirty millions of dollars 
 shall not be subscribed, during the period aforesaid, at all the places aforesaid, the 
 subscription to complete the said sum shall afterwards be and remain open at 
 Philadelphia, under the superintendence of the said commissioners appointed 
 at that place, and the subscription may be then made by any corporation, co- 
 partnership, or person, for any number of shares not exceeding the amount 
 required to complete the said sum of thirty millions of dollars. And, in case 
 of the death, or refusal to serve, of any of the commissioners aforesaid, it shall 
 be lawful for the President of the Umted States to supply the vacancy or va- 
 cancies thus created, by appointing some suitable person or persons. 
 
 SEC. 2. Jlndbe. it. further enacted. That it shall be lawful for any person, 
 copartnership, or body politic, to subscribe for so many shares of me said 
 capital stock of the said bank, as he, she, or they, shall think fit, not exceed- 
 ing three thousand shares, except as is hereinafter provided for the subscrip- 
 tion on behalf of the United States; and the sums respectively subscribed, ex- 
 cept on behalf of the United States, as is hereinafter provided, shall be pay- 
 able in the manner following, that is to say: five millions of dollars thereof in 
 gold or silver coin of the United States, or of foreigtvcoin at the value here- 
 tofore established by the act of Congress, entitled *" An act regulating the cur- 
 
r run: F,M> ix to OF iei/>. 537 
 
 rency of foreign coins,"' passed the 10th day of April, one. thousand eight hun- 
 dred and six; ten millions of dollars thereof in gold or silver coin, as afore- 
 said, or in the public debt of the United States, contracted by virtue of the 
 act of Congress, entitled "An act authorizing a loan for a sum not exceed- 
 ing eleven millions of dollars," passed the fourteenth day of March, one thou- 
 sand eight hundred and twelve, or contracted, or to be contracted, bjr virtue 
 of any subsequent act and acts of Congress, heretofore passed, authorizing a 
 loan or loans; and fifteen millions of dollars thereof in gold and silver coin, 
 or in treasury notes, issued under the act of Congress, entitled *' An act to 
 authorize the issuing of treasury notes," passed the thirtieth day of June, one 
 thousand eight hundred and twelve, or issued, or to be issued, under the au- 
 thority of any subsequent act or acts of Congress, authorizing, or which shall 
 authorize, treasury notes to be issued, previously to the final closing of the 
 subscriptions to the said bank- And the said payment shall be made and 
 completed in tho sums and at the tines hereinafter declared, that is to say: 
 at the time of subscribing there shall be paid six dollars and sixty-six cents 
 and two-thirds of a cent on each share, in gold or silver coin; twenty dollars 
 in the treasury notes aforesaid; and thirteen dollars thirty-three cents and one- 
 third of a cent in the public debt of the United States, contracted, or to be 
 contracted, as aforesaid; at tin 1 , expiration of four calendar months after the 
 time of subscribing, then- shall bepaid the further sum of three dollars thirty- 
 thin' cents and one-third of a cent on each share, in gold or silver coin; ten 
 dollars in the treasury notes aforesaid: and six dollars sixty-six cents and 
 two-thirds of a cent in the public debt of the United States, contracted, or to 
 be contracted, as aforesaid; at the expiration of six calendar months from the 
 time of subscribing, there shall be paid the further sum of three dollars thirty- 
 three cents and one-third of a cent on each share, in gold and silver coin; 
 ten dollars in the treasury notes aforesaid; and six dollars and sixty-six cents 
 and two-thirds of a cent' in the public debt of the United Slates, contracted, 
 or to be contracted, as aforesaid; at the. expiration of eight calendar months 
 from the time of subscribing, there shall lie paid the further sum of three dol- 
 lars thirty-three cents and one-third of a cent in gold or silver crin; ten dol- 
 lars in the treasury notes aforesaid; and six dollars sixty-six cents and two- 
 thirds of a cent in the public debt of the United States, contracted, or to be 
 contracted, as aforesaid. And the subscriptions in public stock and treasury 
 notes, as aforesaid, shall be taken and credited for the principal and so much 
 of the interest thereof, respectively, as shall have accrued on the day of sub- 
 scribing the same. And, at the time of subscribing to the capital stock of the 
 said bank, as aforesaid, each and every subscriber shall deliver to the com- 
 missioners, at the place of subscribing, as well the specie amount of their sub- 
 scriptions, respectively, as the certificates of stock for the stock proportion 
 of tneir subscriptions, respectively, together with a inwer of attorney autho- 
 rizing the said commissioners, or a majority of them, to transfer the said stock, 
 in due form of law, to " The President, Directors, and Company, of the said 
 Bank of the United States of America," as soon as the said bank shall be or- 
 ganized; and, also, treasury notes for the proportion of the subscriptions, re- 
 spectively, payable in treasury notes, as aforesaid: Provided, always, That 
 if, in consequence of the apportionment of shares in the said bank among the 
 subscribers, in the case and in the manner hereinbefore prescribed, any sub- 
 scriber shall have delivered to the commissioners, at the time of subscribing, 
 a greater amount of specie, stock, and treasury notes, than shall be necessary 
 to complete the payments for the share or shares to such subscriber, appor- 
 tioned as aforesaid, the commissioners shall only retain so much of the said 
 money, stock, and treasury notes, as shall be necessary to complete such pay- 
 ments, and shall forthwith return, on application for the same, the surplus 
 thereof to the subscriber lawfully entitled thereto. And the commissioners, 
 respectively, shall deposite the gold and silver, certificates of stock, and trea- 
 sury notes, by them respectively received, as aforesaid, from the subscribers 
 to the said bank, in some place of secure and safe keeping, so that the same 
 may and shall be specifically delivered and transferred, as the same were by 
 
588 BANK OF THE UNITED STATES. 
 
 them respectively received, to the said President, Directors, and Company, of 
 the said Bank of the United States of America, or to their order, as soon as 
 shall be required after the organization of the said bark. 
 
 .SEC. 3. And be it further enacted, That the United States may, at any time 
 before the expiration of this act, in pursuance of any law which may; be passed 
 by Congress for that purpose, cause to be subscribed, for the use of the Unit- 
 ed States, to said bank, fifty thousand additional shares, to be paid in public 
 stock, bearing an interest of four per cent, per annum, redeemable in any 
 sums, and at any periods, which the Government may deem fit. 
 
 SEC. 4. Jlndbe it further enacted, That whenever and as often as any of 
 the treasury notes, subscribed as aforesaid, to the said capital stock of the said 
 bank, shall be due and payable, it shall be lawful for the Secretary of the 
 Treasury (and he is hereby authorized and required) to pay and redeem the 
 same, principal and interest, by causing certificates of public stock for an 
 equal amount, bearing an interest of six per cent, per annum, and redeem- 
 able in any sums, and at any periods, which the Government may deem fit, 
 to be prepared and made ii; the usual form, and the same to be delivered to 
 the President and Directors of the said bank, in satisfaction and discharge of 
 such treasury notes. 
 
 SEC. 5. And be it further enacted, That the subscribers to the said Bank of 
 the United States of America, their successors and assigns, shall be, and are 
 hereby created, a corporation and body politic, by the name and style of " The 
 President, Directors, and Company, of the Bank of the United States of Ame- 
 rica," and shall so continue until the third day of March, in the year one 
 thousand eight hundred and thirty-five: and by that name shall be, and are 
 hereby, made able and capable in law, to have, purchase, receive, possess, 
 enjoy, and retain, to them and their successors, lands, rents, tenements, he- 
 reditaments, goods, chattels, and effects, of whatsoever kind, nature, and 
 quality, to an amount not exceeding, in the whole, thirty-five millions of dol- 
 lars, including the amount of the capital stock aforesaid; and the same to sell, 
 grant, demise, alien, or dispose of, to sue and be sued, plead and be implead- 
 ed, answer arid be answered, defend and be defended, in all courts and pla- 
 ces whatsoever; and also to make, have, and use, a common seal, and the 
 same to break, alter, and renew, at their pleasure; and, also, to ordain, esta- 
 blish, and put in execution, such by-laws and ordinances, and regulations, as 
 they shall deem necessary and convenient, for the government of the said cor- 
 poration, not being contrary to the constitution and laws of the United States; 
 and generally to uo and execute all and singular the acts, matters, and things, 
 which to them it shall or may appertain to do; subject, nevertheless, to the 
 rules, regulations, restrictions, limitations, and provisions, hereinafter pre 
 scribed and declared. 
 
 SEC. 6. And be it further enacted. That, for the management of the affairs 
 of the said corporation, there shall be twenty -five directors, who shall be 
 elected at the banking house in Philadelphia, on the first Monday of January, 
 in each year, by the stockholders or proprietors of the capital stock of the 
 said corporation, and by a plurality of votes then and there actually given, 
 according to the scale of voting hereinafter prescribed. And the directors, 
 so duly chosen, shall be capable of serving by virtue of such choice, until the 
 end or expiration of the first Monday in January next ensuing the time of 
 such election, and no longer: Provided, always, That the first election and 
 appointment of directors shall be at the same time, and for the period, here- 
 inafter declared. 
 
 SEC. 7. And be it further enacted, That, as soon as the sum of twelve mil- 
 lions of dollars in gold and silver coin, and in the public debt and treasury 
 notes, shall have been actually received on account of the subscriptions to the 
 said capital stock, (exclusively of the subscription aforesaid on the part of the 
 United States) notice thereof shall be given by the persons under whose su- 
 perintendence the subscriptions shall have been made at Philadelphia, in at 
 least two public newspapers, printed in each of the places where subscrip- 
 tions shall have been made; and the said persons shall, at the same time, and 
 
PROCEEDINGS OF 1815- 589 
 
 ill like manner, notify a time and place within the said city of Philadelphia, 
 at the distance of at least twenty days from the time of such notification, for 
 proceeding to the election of directors, as aforesaid; and it shall be lawful for 
 such election to be then and there made. And the persons who shall be then 
 and there chosen as aforesaid, shall be the first directors, and shall proceed to 
 elect one of their number president of the said corporation, and they shall be 
 capable of serving by virtue of such choice, until the end and expiration of 
 the first Monday of January next ensuing the time of making the same, and 
 shall forthwith, thereafter, commence the operations of the said bank, at the 
 said city of Philadelphia: Provided, always. That in case it should at any 
 time happen that an election of directors and president of the said corporation 
 should not be made upon any day when, in pursuance of this act, they ought 
 to be made, the said corporation shall not for that cause be deemed to be dis- 
 solved; but it shall be lawful on any other day to hold and make an election 
 of directors and president of the said corporation, (as the case may be) in such 
 manner as shall have been regulated by the by-laws and ordinances ot the said 
 corporation; and until such election be so made, the directors and president, 
 for the time being, shall continue in office: And provided, also, That, in case 
 of the death, resignation, or removal, of the president of the said corporation, 
 the directors shall proceed to elect another president: And provided, also, 
 That, in case of the death, resignation, or absence from the United States, or 
 removal of a director from office, the vacancy shall be supplied by the stock- 
 holders. 
 
 SEC. 8. tfndbe it further enacted, That the directors, for the time being, 
 shall have power to appoint such officers, clerks, and servants, under them, as 
 shall be necessary for executing the business of the said corporation, and to 
 allow them such compensation for their services, respectively, as shall be rea- 
 sonable; and shall be capable of exercising such other powers and authorities 
 for the well governing and ordering of the attairs of the said corporation, as 
 shall be prescribed, fixed, and determined, by the laws, regulations, and or- 
 dinances, of the same. 
 
 SEC. 9. And be it fv.rthf r cnuc ! cd, That the following rules, restrictions, 
 limitations, and provisions, shall form and be fundamental articles of the con- 
 stitution of the said corporation, to wit: 
 
 1. The number of votes to which the stockholder* shall be entitled, in vot- 
 ing for directors, shall be according to the number of shares he, she, or they, 
 respectively, shall hold, in the proportions following, that is to say: for one 
 share and not more than two shares, one vote; for every two shares above two 
 and not exceeding ten, one vote; for every four shares above ten and not ex- 
 ceeding thirty, one vote; for every six shares above thirty and not exceeding 
 sixty, one vote; for every eight shares above sixty and not exceeding one 
 hundred, one vote; and for every ten shares above one hundred, one vote. 
 But no person, copartnership, or body pulitic, shall be entitled to a greater 
 number than thirty votes; and after the first election, no share or shares shall 
 confer a right of voting, which shall not have been holdeii three calendar 
 months previous to the clay of election. And stockholders, actually resident 
 within the United States, and none other, may vote in elections by proxy. 
 
 2. Not more than three-fourths of the directors in office, at the time of an 
 annual election, shall be elected for the next succeeding year, and no person 
 shall be a director more than three out of four years; but the director who 
 shall be the president at the time of an election, may always be re-elected. 
 
 3. None but a resident citizen of the United States, and holding at the time 
 of his election not less than ten shares, bona fide in his own right, shall be a 
 director; and if any director shall cease to be a stockholder to that amount, he 
 shall cease to be a director. 
 
 1. No director shall be entitled to any emolument. The stockholders may 
 make such compensation to the president, for his extraordinary attendance at 
 the bank, as shall appear to them reasonable. 
 
 5. Not less than seven directors shall constitute a board for the transaction 
 of business, of whom the president shall always be one, except in case of 
 
590 BANK OF THE UNITED STATES. 
 
 sickness or necessary absence, in which case his place may be supplied by 
 any other director whom he, by writing, under his hand, shall depute for the 
 purpose. And the director, so deputed, may do and transact all the necessary 
 business belonging to the office of the president of the said corporation, during 
 the continuance of the sickness or necessary absence of the president. 
 
 6. A number of stockholders, not less than sixty, who, together, shall be 
 proprietors of one thousand shares or upwards, shall have power, at any time, 
 to call a general meeting of the stockholders, for purposes relative to the in- 
 stitution, giving, at least, ten weeks' notice in two public newspapers of the 
 place where the bank is seated, and specifying in such notice the'object or 
 objects of such meeting. 
 
 7. Every cashier or treasurer, before he enters upon the duties of his oflicc, 
 shall be required to give bond, with two or more sureties, to the satisfaction 
 of the directors, in a sum not less than fifty thousand dollars, with a condition 
 for his good behavior and faithful performance of his duties to the corporation. 
 
 8. The lands, tenements, and hereditaments, which it shall be lawful for 
 the said corporation to hold, shall be only such as shall be requisite for its im- 
 mediate accommodation in relation to the convenient transacting of business, 
 and such as shall have been bona lide mortgaged to it by way ot security, or 
 conveyed to it in satisfaction of debts previously contracted in the course of 
 its dealings, or purchased at sales, upon judgments which shall have been ob- 
 tained for such debts. 
 
 9. The total amount of debts which the said corporation shall, at any time, 
 owe, whether by bond, bill, note, or other contract, over and above the debt 
 or debts due for money deposited in the bank, shall not exceed the sum of 
 thirty millions of dollars, unless the contracting of any greater debt shall have 
 been previously authorized by a law of the United States. In case ofexcess, 
 the directors under whose administration it shall happen, shall be liable for the 
 same, in their natural and private capacities, and an action of debt may ? in 
 such case, be brought against them, or any of them, their or any of their heirs, 
 executors, or administrators, in any court of record of the United States, or 
 either of them, by any creditor or creditors of the said corporation, and may 
 be prosecuted to judgment and execution, any condition, covenant, or agree- 
 ment, to the contrary, notwithstanding. But this provision shall not be con- 
 strued to exempt the said corporation, or the iands,jtenements, goods, or chat- 
 tels, of the same, from being also liable for, and chargeable with, the said ex- 
 cess. Such of the said directors who may have been absent when the said 
 excess was contracted or created, or who may have dissented from the reso- 
 lution or act whereby the same was so contracted or created, may respectively 
 exonerate themelves from being so liable, by forthwith giving notice of the fact, 
 and of their absence or dissent, to the President of the United States, and to 
 the stockholders, at a general meeting, which they shall have power to call for 
 that purpose. 
 
 10. The said corporation shall not, directly or indirectly, deal or trade in 
 any thing except bills of exchange, gold or silver bullion, or in the sale of 
 goods really and truly pledged for money lent, and not redeemed in due time, 
 or goods which shall be the proceeds of its lands, ft shall not be at liberty to 
 purchase any public debt whatsoever; nor shall it take more than at the rate 
 of six per cent, per annum for or upon its loans or discounts. 
 
 11. The said corporation shall not, in any oiae year, sell any portion of the 
 public debt constituting a part of its capital stock aforesaid, to an amount ex- 
 ceeding five millions ot dollars, without the consent of Congress. 
 
 12. No loan shall be made by the said corporation, for the use, or on account, 
 of the Government of the United States, to an amount exceeding five hun- 
 dred thousand dollars; or of any particular State, to an amount exceeding 
 fifty thousand dollars; or to any foreign prince or State, unless previously 
 authorized by a law of the United States. 
 
 13. The stock of the said corporation shall be assignable arid transferable 
 according to such rules as shall be instituted in that behalf, by the laws and 
 ordinances of the same. 
 
PROCEEDINGS OF 1815. 
 
 14. The bills obligatory and of credit, under the seal of the said corporation, 
 which shall be made to any person or persons, shall be assignable by endorse- 
 ment thereupon, under the hand or hands of such person or persons, arid his, 
 her, or their executors, or administrators, and of his, her, or their assignee or 
 assignee?, and the executors or administrators of such assignee or assignees, 
 and so as absolutely to transfer and vest the property thereof in each and 
 every assignee or assignees, successively, and to enable such assignee or 
 assignees, and his, her, or their executors or adminstrators, to maintain an 
 action thereupon, in his, her, or their own name or names. And the bills or 
 notes which may be issued by order of the said corporation, signed by the presi- 
 dent and countersigned by the principal cashier or treasurer thereof, promis- 
 ing the payment of money to any person or persons, his, her, or their order, 
 or to bearer, although not under the seal of the said corporation, shall be bind- 
 ing and obligatory upon the same, in the like manner, and with the like force 
 and effect, as upon any private person or persons, if issued by him, her, or 
 them, in his, her, or their private or natural capacity or capacities, and shall 
 be assignable and negotiable in like manner, as if they were so issued by such 
 private person or persons, that is to say: those which shall be payable to any 
 person or persons, his, her, or their order, shall be assignable, by endorse- 
 ment, in like manner, arid with the like effect, as foreign bills of exchange 
 now are; and those which are payable to bearer, shall be assignable and ne- 
 gotiable by delivery only. 
 
 15. Half yearly dividends shall be made of so much of the profits of the 
 bank as shall appear to the directors advisable: and once in every three years, 
 the directors shall lay before the stockholders, at a general meeting, for their 
 information, an exact and particular statement of the debts which shall have 
 remained unpaid after the expiration of the original credit, for a period of tre- 
 ble the term of that credit, and of the surplus of profits, if any, after deduct- 
 ing losses and dividends. If there shall be a failure of any part of any sum 
 subscribed by any person, copartnership, or body politic, the party failing- shall 
 lose the benefit ot any dividend which may have accrued prior to the time for 
 making such payment, and during the delay of the same. 
 
 16. The directors of said corporation shall be bound to establish a competent 
 office of discount and deposite in the District of Columbia, vyhenever any law 
 of the United States shall require such establishment; and it shall be lawful 
 for the said directors to establish offices wheresoever they shall think fit, with- 
 in the United States or the territories thereof, for the purposes of discount, de- 
 posite, and distribution; or tor the purposes of deposite and distribution only; 
 and upon the same terms, and in the same manner, as shall be practised at 
 the bank; and to commit the management of the said offices, and the business 
 thereof, respectively, to such persons, and under such regulations, as they shall 
 deem proper, not being contrary to law or to the constitution of the bank. Or, 
 instead ot establishing such offices, it shall be lawful for the directors of the 
 said corporation, from time to time, to employ any other bank or banks, at any 
 place or places that they may deem safe and proper, to manage and transact 
 the business proposed, as aforesaid, to be managed and transacted by such of- 
 fices, under such agreements, and subject to such regulations, as they shall 
 deem just and proper. But the managers or directors of every office of dis- 
 count, deposite, and distribution, established as aforesaid, shall be annually 
 appointed by the directors of the bank, to serve one year; each of them shall 
 be a citizen of the United States, and shall hold, at the time of his appoint- 
 ment, not less than five shares in the said bank, bona fide in his own right; 
 and, if he shall cease to be a stockholder to that amount, he shall cease to be 
 a manager or director of such office of discount, deposite, and distribution; 
 and not more than three -fourths of the said managers or directors in office, at 
 the time of an annual appointment, shall be reappointed for the next succeed- 
 ing year; nor shall any person be a manager or director for more than three 
 out of four years; but the president may be always reappointed. 
 
 17. The said corporation, all offices of discount, deposite, and distribution, 
 and of deposite and distribution only, which shall be established by the said 
 
BANK OF THE UNITED STATES. 
 
 directors as aforesaid, and all banks by the said directors employed in lieu of 
 such offices as aforesaid, shall be bound to receive, upon deposite, the treasury 
 notes of the United States, which have been, or may be hereafter, issued, by 
 virtue of any law or laws of the United States; but it shall be optional with 
 the said corporation to pay and discharge the checks or drafts of the persons 
 making such deposite, in treasury notes, for the amount thereof, either in gold 
 or silver coin, or in the notes of the bank, or in treasury notes. And all banks 
 employed as aforesaid, in lieu of the offices aforesaid, shall be further bound to 
 receive on deposite, and to 'circulate, the notes of the said corporation, on the 
 same terms and in the same manner, as the notes of the said banks, respective- 
 ly, are received and circulated; and, from time to time, issue and exchange, 
 for the said notes of the said corporation, other notes of the said corporation, 
 or the notes of the said banks, respectively, or treasury notes, at the opiion of 
 the persons applying for such issue or exchange. The said corporation shall, at 
 all times, distribute among the offices of discount, deposite, and distribution, 
 and of deposite and distribution only, and at all the banks employed in lieu 
 of such offices, as aforesaid, a sufficient sum, in the various denominations of 
 the notes of the said corporation, and in the treasury notes which it may receive 
 upon deposite from the fGoyernment, to answer the demand therefor, and to 
 establish a sufficient circulating medium throughout the United States and the 
 territories thereof. 
 
 18. The officer at the head of the Treasury Department of the United 
 States shall be furnished, from time to time, as often as he may require, not 
 exceeding once a week, with statements of the amount of capital stock of the 
 said corporation, and of the debts due to the same; of the moneys deposited 
 therein, of the notes in circulation and of the cash in hand; and shall have a 
 right to inspect such general accounts in the books of the bank, as shall relate 
 to the said statement: Provided, That this shall not be construed to imply a right 
 of inspecting the account of any private individual orindividuals with the bank. 
 SEC. 10. And beit further enacted, That, if the said corporation, or any 
 person or persons, for or to the use of the same, shall deal or trade in buying 
 or selling any goods, wares, merchandise, or commodities, whatsoever, contra- 
 ry to the provisions of this act, all and every person and persons by whom any 
 order or direction for so dealing or trading shall have been given, and all and 
 every person and persons who shall have been concerned as parties or agents 
 therein, shall forfeit and lose treble the value of the goods, wares, merchan- 
 dises, and ^commodities, in which such dealings and trade shall have been; 
 one half thereof to the use of the informer, and the other half thereof to the use 
 of the United States, to be recovered in any action at law, with costs of suit. 
 SEC. 11. And be it further enacted, That, if the said corporation shall ad- 
 vance or lend any sum of money, for the use, or on account, of the Govern- 
 ment of the United States, to an amount exceeding three hundred thousand 
 dollars; or of any particular State, to an amount exceeding fifty thousand dol- 
 lars; or of any foreign prince or State, (unless previously authoiized thereto, 
 by a law of the United States) all and every person and persons, by and with 
 whose order, agreement, consent, approbation, and connivance, such unlawful 
 advance or loan shall have been made, upon conviction thereof, shall forfeit 
 and pay, for every such offence, treble the value or amount of the sum or 
 sums which shall have been so unlawfully advanced or lent; one-fifth thereof 
 to the use of the informer, and the residue thereof to the use of the United 
 States. 
 
 SEC. 12. Jind be it further enacted, That the bills or notes of the said cor- 
 poration, originally made payable, or which shall have become payable, on 
 demand, shall be receivable in all payments to the United States, until other- 
 wise directed by act of Congress. 
 
 SEC. 13. Jind be itfurther enacted, That, if the subscriptions and payments 
 to the said bank shall not be made and completed, so as to enable the same to 
 commence its operations, or if the said bank shall not commence its operations 
 on or before the first day of March, one thousand eight hundred and sixteen, 
 then, and in that case, this act shall be null and void. 
 
PROCEEDINGS OF 1815. 593 
 
 SBC. 14. rfnd be it further enact ed* That it shall, at all times, be lawful 
 for a committee of either House of Congress, appointed for that purpose, to 
 inspect the books, and to examine into the proceed ings of the corporation here- 
 by created, and to report whether the provisions of this charter have been by 
 the same violated or not: and, whenever any committee, as aforesaid, shall 
 find and report, or the President of the United States shall have reason to be- 
 lieve, tliat the charter has been violated, it may be lawful for Congress to di- 
 rect, or the President to order, a scire facias to be sued out of the circuit court 
 of the district court of Pennsylvania, in the name of the United States, (which 
 shall be executed upon the president of the corporation, for the time being, 
 at least fifteen days before the commencement of the term of said court) call- 
 ing on the said corporation to show cause wherefore the charter, hereby grant- 
 ed, shall not be declared forfeited^ and it shall be lawful for the said court, 
 upon the return of the said scire facias, to examine into the truth of the al- 
 leged violation, and, if such violation be made appear, then to pronounce 
 and adjudge, mat the said charter is forfeited and annulled: Provided* how- 
 ever, Every issue of fact which may be joined between the United States and 
 the corporation shall be tried by jury. And it shall be lawful for the court 
 aforesaid to require the production of such of the books of the corporation as 
 it may deem necessary tor the ascertainment of the controverted facts; and 
 the final judgment of the court aforesaid shall be examinable in the supreme 
 court of the United States, by writ of error, and may be there reversed or af- 
 firmed, according to the usages of law. 
 
 SEC. 15. rfndZe it further enacted. That, during the continuance of this 
 act, and whenever required by the Secretary of the^Treasury, the said corpo- 
 ration shall do and perform the several and respective duties of the commis- 
 sioners of loans for the several States, or of any one or more of them, at the 
 times, in the manner, and upon the terms, to be prescribed by the Secretary 
 of the Treasury. 
 
 SEC. 16. And be it further enacted. That no other bank shall be established 
 by any future law of the United States, during the continuance of the corpo- 
 ration hereby created; for which the faith of the United States is hereby 
 pledged: Provided, Congress may renew existing charters for banks in the 
 District of Columbia, not increasing the capital thereof; and may grant char- 
 ters, if they deem it expedient, to any banking associations now in opera- 
 tion, in the said district, aad renew the same, not increasing the capital there- 
 of. And, notwithstanding the expiration of the term for which the said cor- 
 poration is created, it shall be lawful to use the corporate name, style, 
 and capacity, for the purpose of suits, for the final settlement and liquida- 
 tion of the affairs and accounts of the corporation^ and for the sale and dispo- 
 sition of their estate, real, personal, and mixed, but not for any other purpose, 
 or in any other manner whatsoever: nor for a period exceeding two years af- 
 ter the expiration of the said term of incorporation. 
 
 LANGDON CHEVES, 
 
 Speaker of the House of Representatives. 
 
 JOHN GAILLARD, 
 
 President of the Senatf^pro tempore. 
 
594 BANK OF THE UNITED STATES. 
 
 IN SENATE. 
 
 JANUARY 30, 1815. 
 
 THE PRESIDENT'S VETO OF THE BILL. 
 
 Mr. COLES, the President's secretary, returned the bill "to incorporate the 
 subscribers to the Bank of the United States of America," with the following 
 message : 
 
 To the Senate of the United Stales: 
 
 Having bestowed on the bill, entitled "An act to incorporate the subscri- 
 bers to the Bank of the United States of America," that full consideration 
 which is due to the great importance of the subject, and dictated by the re- 
 spect which I feel for the two Houses of Congress, I am- constrained, by a 
 deep and solemn conviction that the bill ought not to become a law, to return 
 it to the Senate, in which it originated, with my objections to the same. 
 
 Waiving the question of the constitutional authority of the Legislatwe to 
 establish an incorporated bank, as being precluded, in my judgment, by re- 
 peated recognitions, under varied circumstances, of the validity of such an 
 institution, in acts of the legislative, executive, and judicial branches of the 
 Government, accompanied py indications, in different modes, of a concur- 
 rence of the general will of the nation; the proposed bank does not appear to 
 be calculated to answer the purposes of reviving the public credit, of providing 
 a national medium of circulation, and of aiding the treasury by facilitating the 
 indispensable anticipations of the revenue, and by affording to the public 
 more durable loans- 
 
 1. The capital of the bank is to be compounded of specie, of public stock, 
 and of treasury notes convertible into stock, with a certain proportion of each 
 of which every subscriber is to furnish himself. 
 
 The amount of the stock to be subscribed will not, it is believed, be suffi- 
 cient to produce, in favor of the public credit, any considerable or lasting 
 elevation of the market price, whilst this maybe occasionally depressed by 
 the bank itself, if it should carry into the market the allowed proportion of its 
 capital consisting of public stock, in order to procure specie, which it may 
 find its account in procuring., with some sacrifice on that part of its capital. 
 
 Nor will any adequate advantage arise to the public credit from me sub- 
 scription of treasury notes. The actual issue of tnese notes nearly equals, at 
 present, and will soon exceed, the amount to be subscribed to the bank. The 
 direct effect of this operation is simply to convert fifteen millions of treasury 
 notes into fifteen millions of six per cent, stock, with the collateral effect of 
 promoting an additional demand for treasury notes, beyond what might other- 
 wise be negotiable. 
 
 Public credit might indeed be expected to derive advantage from the esta- 
 blishment of a national bank, without regard to the formation of its capital, if the 
 full aid and co-operation of the institution were secured to the Government during 
 the war, and during the period of its fiscal embarrassments. But the bank 
 proposed will be free from all, legal obligation to co-operate with the public 
 measures; and whatever might be the patriotic disposition of its directors to 
 contribute to the removal of those embarrassments, and to invigorate the prose- 
 cution of the war, fidelity to the pecuniary and general interest of the institu- 
 tion, according to their estimate of it, might oblige them to decline a connexion 
 of their operations with those of the national treasury, during the continuance 
 of the war and the difficulties incident to it. Temporary sacrifices of inter- 
 est, though over balanced by the future and permanent profits of the charter, 
 not being requirable of right in behalf of the public, might not be gratuitously 
 made; and the bank would reap the full benefit of the grant, whilst the public 
 would lose the equivalent expected from it. For it must be kept in view, that 
 
tniOCEEDlNGS OF 1815. 595 
 
 the sole inducement to such a grant, on the part of the public, would be the 
 prospect of substantial aids to its pecuniary means at the present crisis, and 
 during the sequel of the war. It is evident that the stock of the bank will, 
 on the return of peace, if not sooner, rise in the market to a value which, if 
 the bank were established in a period of peace, would authorize and obtain 
 for the public a bonus to a very large amount. In lieu of such a bonus the 
 Government is fairly entitled to, and ought not to relinquish or risk, the need- 
 ful services of the bank, under the pressing circumstances of war. 
 
 2cl. The bank, as proposed to be constituted, cannot be relied on, during 
 the war, to provide a circulating medium, nor to furnish loans, or anticipations 
 of the public revenue. 
 
 Without a medium, the taxes cannot be collected; and in the absence of 
 specie, the medium understood to be the best substitute, is that of notes 
 issued by a national bank. The proposed bank will commence and conduct 
 its operations, under an obligation to pay its notes in specie, or be subject to 
 the loss of its charter. Without sutfi an obligation, the notes of the bank, 
 though not exchangeable for specie, yet resting on good pledges, and perform- 
 ing Uie uses of specie, in the payment of taxes, and in other public transac- 
 tions, would, as experience has ascertained, qualify the bank to supply at 
 once a circulating medium, and pecuniary aids to the Government. Under 
 the fetters imposed by the bill, it is manifest that, during the actual state of 
 thing's, and probably during the war, the period particularly requiring such a 
 medium awl such a resource for loans and advances to the Government, notes 
 for which the bank would be compilable to give specie in exchange could not 
 be kept in circulation. The most the bank could effect, and the most it could 
 be expected to aim at, would be to keep the institution alive, by limited and 
 local transactions, which, with the interest on the public stock in the bank, 
 might yield a dividend sufficient for the purpose, until a change from war to 
 peace should enable it, by a flow of specie into its vaults, and a removal of the 
 external demand for it, to derive its contemplated emoluments from a safe and 
 full extension of its operations. 
 
 On the whole, when it is considered that the proposed establishment will 
 enjoy a monopoly of the profits of a national bank, fora period of twenty years; 
 that monopolized profits will be continually growing with the progress of the 
 national population and wealth; that the nation will, during the same period, 
 be dependent on the notes of the bank for that species of circulating medium, 
 whenever the precious metals may be wanted, and at all times for so much 
 thereof as may be an eligible substitute i< r a specific medium; and that the 
 extensive employment of the notes in the collection of the augmented taxes, 
 will, moreover, enable the bank greatly to extend its profitable issues ot them, 
 without the expense of specie capital to support their circulation; it is as rea- 
 sonable as it is requisite, that the Government, in return for these extraordi- 
 nary concessions to the bank, should have a greater security for attaining the 
 public objects of the institution, than is presented in the bill, and particularly 
 for every practicable accommodation, both in the temporary advances neces- 
 sary to anticipate the taxes, and in those more durable loans which are equally 
 necessary to diminish the resort to taxes. 
 
 In discharging this painful duty of Stating objections to a measure which 
 has undergone the deliberations and received the sanction of the two Houses 
 of the National Legislature, I console myself with the reflection, that, if they 
 have not the weight which I attach to them, they can be constitutionally over- 
 ruled; and with a confidence that, in a contrary event, the wisdom of Con- 
 gress will hasten to substitute a more commensurate and certain provision for 
 the public exigencies. 
 
 JAMES MADISON. 
 
 WASHINGTON, January 307 /J, 1815. 
 
596 BAN K OF THE UNITED STATES. 
 
 JANUARY 31, 1815, 
 
 On proceeding to reconsider the bill, returned by the President, the said 
 bill, and the objections of the President thereto, were read; when, after some 
 debate, the further consideration thereof was, on motion of Mr. BARBOUR, 
 postponed to Thursday next, by the following vote: 
 
 For the postponement, - - - 16, 
 
 Against it, - . 13. 
 
 FEBRUARY 2, 1815. 
 
 The Senate resumed the consideration of the bill returned by the President 
 of the United States, "to incorporate the subscribers to the Bank of the Unit- 
 ed States," together with his objections thereto; and, after some debate, the 
 question was again put, "Shall the bill pass?" and decided as follows: 
 
 YEAS Messrs. Brown, Dag-g*ett, Dana, Fromentin, German, Giles, Goldsboroug-h, 
 Gore, Horsey, Hunter, King-, Lambert, Mason, Tait, Thompson 15. 
 
 NAYS Messrs, Anderson, Harbour, Bibb, Barry, Chase, Condit, Gailkrd, Kerr, 
 Lacock, Morrow, Roberts, Robinson, Smith, Talbot, Taylor, Turner, Varnum, Wells, 
 Wharton 19. 
 
 So the Senate refused to pass the bill, (to do which, after the refusal of the 
 President to sanction it, would have required the votes of two -thirds of all the 
 members present) and the bill was therefore lost. 
 
 FEBRUARY 6, 1815. 
 
 Agreeably to notice on the 4th instant, Mr. BARBOUR, leave being given, 
 introduced the following bill; which was read a second time: 
 
 A Bill to incorporate the subscribers to the Bank of the United States of America. 
 
 Be it enacted by the Senate and House of Representatives of the United 
 States of America in Congress assembled, That a Bank of the United States 
 of America shall be established, the capital stock of which shall be fifty mil- 
 lions of dollars, and no more, divided into one hundred and twenty-five 
 thousand shares, of four hundred dollars each share; and that subscriptions 
 for forty millions of dollars, towards constituting the said capital stock, shall 
 be opened on the first Monday of April next, at the following places, viz: at 
 Portland, in Maine, Portsmouth, in New Hampshire, Windsor, in Vermont, 
 Boston, Providence, New Haven, New York, New Brunswick, in New Jersey, 
 Philadelphia, Baltimore, the city of Washington/Richmond, Raleigh, Charles- 
 ton, Savannah, Lexington, in Kentucky, Nashville, in Tennessee, Cnitlicothe, 
 in Ohio, and New Orleans, under the superintendence of the following per- 
 sons, as commissioners to receive the same: at Portland, Matthew Cobb, Isaac 
 Ilsley, Joshua Wingate, junior; at Portsmouth, John Goddard, Nathaniel A. 
 Haven, Henry S. Langdon; at Windsor, Elias Lyman, William Leveret, 
 Eleazar May; at Boston, Israel Thorndike. Thomas H. Perkins, William 
 Gray, Aaron Hill. Samuel Brown; at Providence, Seth Wheaton, Ebenezer 
 K. Dexter, Henry Smith; at New Haven, Abraham Bishop, William W.Wool- 
 sey, Henry Jones; at New York, Robert Troup, William Paulding, Junior, 
 Robert Lenox,' John Jacob Astor, Samuel Tooker, Isaac Bronson, Henry A. 
 Coster; at New Brunswick, James Vanderpool, John Bray, Peter Gordon; at 
 Philadelphia, Jared Ingersoll, Thomas M. Willing, Stephen Girard, Chandler 
 Price, Anthony Taylor, John Sergeant ? CadwaTlader Evans; at Baltimore, 
 James A. Buchanan, Henry Payson, William Wilson; at the city of Wash- 
 ington, John Mason, Robert Brent, John P. Van Ness; at Richmond, Ben- 
 jamin Hatcher, John Brockenborough, John Preston; at Raleigh, Sherwood 
 Haywood, Beverly Daniel, William Peace; at Charleston, John C. Faber, 
 Thomas Jones, Stephen Elliot, Charles B. Cochran, Thomas Blackwood; at 
 
PROCEEDINGS OF 1816. 597 
 
 Savannah, John Bolton, Charles Harris, James Johnson; at Lexington, in Ken- 
 tucky, Charles Wilkins, Lewis Sanders, John H. Morton: at Nashville, Robert 
 Weakly,jFelix Grundy, John R. Bedford; at Chillicothe, Samuel Finley, Thos. 
 James, Win. M'Farland; at New Orleans, Dominick A. Hall ? Benj. Morgan. 
 Paul Lanuse, Thos. L. Harman,and Wm. Flood : which subscriptions shall con- 
 tinue open every day, from the time of opening the same, from ten o'clock, in the 
 forenoon, until four o'clock, in the afternoon, until.the Saturday following, at 
 four o' clock in the afternoon, when the same shall be closed; and immediately 
 thereafter, the commissioners, or any two of them, at the respective places 
 aforesaid, shall cause two transcripts or fair copies of such subscriptions to be 
 made, one of which they shall send to the Secretary of the Treasury, one they 
 shall retain, and the original shall, within three days from the closing of the 
 same, t>e, by the said commissioners, transmitted to the said commissioners at 
 Philadelphia, or to one of them; and on the receipt thereof, the said commis- 
 sioners at Philadelphia, or any three of them, shall immediately thereafter 
 convene, and proceed to take an account of the said subscriptions; and if more 
 than the amount of forty millions of dollars shall have.been subscribed, then the 
 said last mentioned commissioners shall apportion the same among the several 
 subscribers, according to their several and respective subscriptions: Provided, 
 however, That such commissioners shall, by such apportionment, allow and 
 apportion to each subscriber, at least one share; and in case the aggregate 
 amount of the said subscriptions shall exceed forty millions of dollars, the said 
 commissioners, after having apportioned the same as aforesaid, shall cause lists of 
 the said apportioned subscriptions to be madeput, including in each list the appor- 
 tioned subscription lor the place where the original subscription was made, one of 
 which lists shall be transmitted to the commissioners, or to one of the commis- 
 sioners, under whose superintendence such subscriptions were originally made, 
 that the subscribers may ascertain from them the number of shares apportioned 
 to such subscribers, respectively; and if the amount of forty millions of dollars 
 shall not be subscribed during the period aforesaid, at all the places aforesaid, 
 the subscription to complete the said sum shall afterwards be and remain open 
 at Philadelphia, under the superintendence of the said commissioners appoint- 
 ed at that place, and the subscription may be then made by any corporation, co- 
 partnership, or person, for any number of shares not exceeding the amount 
 required to complete the said sum of forty millions of dollars. And in case of 
 the death, or refusal to serve, ot any of the commissioners, aforesaid, it shall 
 be lawful for the President of the United States to supply the vacancy or vacan- 
 cies thus created, by appointing some suitable person or persons. 
 
 Sec. 2. And be. it further enacted, That it shall be lawful for any person, 
 copartnership, or body politic, to subscribe for so many shares of the said capi- 
 tal stock of the said bank, as he, she, or they, shall'think tit, not exceeding 
 one thousand shares, except as is hereinafter provided for the subscription on 
 behalf of the United States; and the sums respectively subscribed, except on 
 behalf of the United States, as is hereinafter provided, shall be payable in the 
 manner following, that is to say: five millions of dollars thereof, in gold or 
 silver coin of the United States, or of foreign coin, at the value heretofore es- 
 tablished by the act of Congress, entitled 4 ' An act regulating the currency of 
 foreign coins." passed the tenth of April, one thousand eight hundred and six; 
 fifteen millions of dollars, thereof, in gold or silver coin aforesaid, or in any 
 of the six per cent, stock of the United States, heretofore created, or hereaf- 
 ter to be created, by virtue of any act of Congress, heretofore passed, autho- 
 rizing a loan or loans; and twenty millions of dollars thereof in gold or silver 
 coin, or in treasury notes, issued under the act of Congress, entitled " An 
 act to authorize the issuing of treasury notes," passed the thirtieth day of 
 June, one thousand eight hundred and twelve, or issued, or to be issued, un- 
 der the authority of any subsequent act or acts of Congress, authorizing or 
 which shall authorize, treasury notes to be issued, previously to the final clos- 
 ing of the subscriptions to the said bank. And the said payment shall be 
 made and completed, in the sums, and at the times, hereinafter declared, that 
 is so say: at the time of subscribing, there shall be paid ten dollars on each 
 
598 BANK OF THE UNITED STATES. 
 
 share, in gold or silver coin, forty dollars in the treasury notes aforesaid, 
 and thirty dollars in the public debt of the United States, contracted or to be 
 contracted as aforesaid. And payments to the same amount, arid in the same 
 proportions of specie, treasury notes, and public stock, as aforesaid, shall be 
 made on each share at ihe expiration of three, six, nine, and twelve calendar 
 months, from the time of subscribing. And the subscriptions in public stock 
 and treasury notes, as aforesaid, shall be taken and credited for the principal 
 and so much of the interest thereof, respectively, as shall have accrued on the 
 day of subscribing the same. And at the time of subscribing to the capital 
 stock of the said bank, as aforesaid, each and every subscriber shall deliver to 
 the commissioners, at the place of subscribing, as well the specie amount of 
 their subscriptions, respectively, as the certificates of stock for the stock pro- 
 portion of their subscriptions, respectively, together with a power of attorney 
 authorizing the said commissioners, or a majority of them, to transfer the 
 said stock, in due form of law, to " 4 the president, directors, and company, of 
 the said Bank of the United States of America," as soon as the said bank shall 
 be organized, and, also, treasury notes for the proportion of the subscriptions, 
 respectively, payable in treasury notes as aforesaid: Provided always, That 
 if, inconsequence of the apportionment of shares in the said bank among the sub- 
 scribers, in ihe case and in the manner hereinbefore prescribed, any subscri- 
 ber shall have delivered to the commissioners, at the time of subscribing, a 
 greater amount of specie, stock, and treasury notes, than shall be necessary to 
 complete the payments for the share or shares to such subscriber, apportioned 
 as aforesaid, the commissioners shall only retain so much of the said money, 
 stock, and treasury notes, as shall be necessary to complete such payments, 
 and shall forthwith return, on application for the same, the surplus thereof to 
 the subscriber lawfully entitled thereto. And the commissioners, respective- 
 ly, shall deposite the gold and silver, certificates of stock, and treasury notes, 
 by them respectively received as aforesaid from the subscribers to the said bank, 
 in some place of secure and safe keeping, so that the same may and shall be 
 specifically delivered and transferred, as the same were by them respectively 
 received, to the said president, directors, and company, of the said Bank of 
 the United States of America, or to their order, as soon as shall be required 
 after the organization of the said bank. 
 
 Sec. 3. Jind belt further enacted, That, at the opening of the subscriptions 
 to the capital stock of the Bank of the United States of America, the Secretary 
 of the Treasury shall subscribe, or cause to be subscribed, on behalf of the 
 United States, to the said capital stock of the said bank, the amount of ten 
 millions of dollars, to be paid in public stock, bearing an interest of four per 
 cent, per annum, from the time of subscribing the same, and reedeemable in 
 any sums, and at any periods, which the Government may deem tit; and the 
 certificates of such public stock, the Secretary of the Treasury shall cause to 
 be prepared and made in the usual form, and shall pay and deliver to the pre- 
 sident and directors of the said bank, at the expiration of three calandar 
 months, after the time of opening the said subscription to the capital stock of 
 the said bank as aforesaid. 
 
 Sec. 4. And be it further enacted, That whenever, and as often, as any 
 of the treasury notes, subscribed as aforesaid, to the said capital stock of the 
 said bank, shall be paid on such subscription, it shall be lawful for the Secreta- 
 ry of the Treasury (and he is hereby authorized and required) to pay and re- 
 deem the same, principal and interest, by causing certificates of public stock for 
 an equal amount, bearing an interest of six per cent, per annum, and redeema- 
 ble in any sums, and at any periods, which the Government may deem fit, to 
 be prepared and made in the usual form, and the same to be delivered to the 
 president and directors of the said bank, in satisfaction and discharge of such 
 treasury notes. 
 
 SEC. 5. And be it further enacted, That the subscribers to the said Bank of 
 the United States of America, their successors and assigns, shal be, and are 
 hereby, created a corporation and body politic, by the name and style of " the 
 President, Directors, and Company, ot the Bank of the United States of 
 
PROCEEDINGS OF 1815. 599 
 
 America," and shall so continue until the third day of March, in the year one 
 thousand eight hundred and thirty-five; and by that name shall be, and are 
 hereby, made able and capable in law, to have, purchase, receive, possess, en- 
 joy, and retain, to them and their successors, lands, rents, tenements, here- 
 ditaments, goods, chattels, and effects, of whatsoever kind, nature, and quality, 
 to an amount not exceeding in the whole fifty-five millions of dollars, includ- 
 ingthe amount of the capital stock aforesaid ; and the same to sell, grant, demise, 
 alien, or dispose of, to sue and be sued, plead and be impleaded, answer and 
 be answered, defend and be defended, in all courts and places whatsoever; 
 and also to make, have, and use, a common seal, and the same to break, 
 alter, and renew, at their pleasure; and also, to ordain, establish, and put in 
 execution, such by-laws, and ordinances, and regulations, as they shall deem 
 necessary and convenient for the government of the said corporation, not be- 
 ing contrary to the constitution and laws of the United States; and generally 
 to do and execute all and singular the acts, matters, and things, which to them it 
 shall or may appertain to do; subject, nevertheless, to the rules, regulations, 
 restrictions, limitations, and provisions, hereinafter prescribed and declared. 
 
 SEC. 6. And be it further enacted, That, for the management of the affairs 
 of the said corporation, there shall be twenty-five directors, who shall be 
 elected at the banking house in Philadelphia, on the first Monday of February, 
 in each year, by the stockholders or proprietors of the capital stock of the 
 said corporation, and by a plurality of votes then and there actually given, 
 according to I he scale of voting hereinafter prescribed. And the directors, 
 HO duly chosen, shall be capable of sen ing, by virtue of such choice, until the 
 end or expiration of the first Monday in February next, ensuing the time of 
 such election, and no longer: Provided^ however. That there shall be no elec- 
 tion for directors, other than to fill varancir-, until the first Monday in Feb- 
 ruary, in the year one thousand eight hundred and sixteen: and that, in 
 the mean time, WiUiatn Gray and Thomas II. Perkins, of Massachusetts; 
 James IV Wolf, of Rhode Island; Archibald Oracle, Robert Lenox. John G. 
 
 Coster, Isaac Pierson, Augustus Wright, Samuel Tooker, , of 
 
 New York: Jared Ingersoll, Stephen Girard, Thomas M. Willing, William 
 Jones, Nicholas Biddle, Thomas Leiper, James C. Fisher, Chandler Price, 
 Cadwallader Kvnns, Jacob G. Koch, of Pennsylvania; Robert Gilmor.James 
 A. Buchanan, Isaac M'lvim, Dennis A. Smith, of Maryland: John P. Van 
 Ness and Thomas Swann, of the District of Columbia, be, and they are.here- 
 by declared to be, directors of the said corporation. 
 
 SEC. 7. And be it further enacted. That, as soon as the sum of twenty millions 
 of dollars, in gold and silver coin, and in the public debt and treasury notes, 
 shall have been subscribed, and the first payment actually received on ac- 
 count of the subscriptions to the said capital stock, (exclusively of the subscrip- 
 tion aforesaid, on the part of the United States) notice thereof shall tie given 
 by the persons under whose superintendence the subscriptions shall have been 
 made at Philadelphia, to each of the directors aforesaid; and the persons 
 herein before named to be the first directors, shall proceed to elect one of their 
 number president of the said corporation, and they shall be capable of serving 
 until the end and expiration of me first Monday of February, in the year one 
 thousand eight hundred and sixteen; and shall forthwith commence the oper- 
 ations of the said bank, at the said city of Philadelphia: Provided always, 
 That, in case it should, at any time, happen that an election of directors and 
 president of the said corporation should not be made upon any clay when, in 
 pursuance of this act, they ought to be made, the said corporation shall not, 
 for that cause, be deemed to be dissolved; but it shall be lawful on any other 
 day to hold and make an election of directors and president of the said cor- 
 poration, (as the case may be) in such manner as shall have been regulated by 
 the by-laws and ordinances of the said corporation; and until such election 
 be so made, the directors and president, for the time being, shall continue in 
 office: Jlnd provided, also, That, in case of the death, resignation, or removal 
 of the president of the said corporation, the directors shall proceed to elect 
 another president: .find provided, also. That, in'case of the death, resignation, 
 
600 BANK OF THE UNITED STATES. 
 
 or absence from the United States, or removal of a director from office, the 
 vacancy shall be supplied by the stockholders. 
 
 SEC. 8. And be it further enacted^ That the directors, for the time being, 
 shall have power to appoint such officers, clerks, and servants, under them* 
 as shall be necessary tor executing the business of the said corporation, ana 
 to allow them such compensation for their services, rsepectively, as shall be 
 reasonable; and shall be capable of exercising such other powers and autho- 
 rities for the well governing and ordering of the affairs of the said corpora- 
 tion, as shall be prescribed, fixed, and determined, by the laws, regulations, 
 and ordinances, of the same. 
 
 SEC. 9. Jlnd be it further enacted, That the following rules, restrictions, 
 limitations, and provisions, shall form and be fundamental articles of the con- 
 stitution of the said corporation, to wit: 
 
 1. The number of votes to which the stockholders shall be entitled, in vot- 
 ing for directors, shall be according to the number of shares he, she, or they, 
 respectively, shall hold, in the proportions following, that is to say: for one 
 share and not more than two shares, one vote; for every two shares above two 
 and not exceeding ten, one vote; for every four shares above ten and not ex- 
 ceeding thirty, one vote; for every six shares above thirty and not exceeding 
 sixty, one vote; for every eight shares above sixty and not exceeding one hun- 
 dred, one vote; and for every ten shares above one hundred, one vote. But 
 no person, copartnership, or body politic, shall be entitled to a greater number 
 than thirty votes; and no share or shares shall confer a right of voting, which 
 shall not have been holden three calendar months previous to the day of elec- 
 tion. And stockholders actually resident within the United States or the 
 territories thereof, and none other, may vote in elections by proxy. 
 
 2. Not more than three-fourths of the directors in office at the time of an 
 annual election, shall be elected for the next succeeding year, and no person 
 shall be a director more than two out of three years; but the director who 
 shall be the president at the time of an election, may always be re-elected. 
 
 3. None but a resident citizen of the United States, and holding, at the 
 time of his election, not less than ten shares bonafide in his own right, shall 
 be a director; and if any director shall cease to be a stockholder to that amount, 
 he shall cease to be a director. 
 
 4. No director shall be entitled to any emolument. The stockholders may 
 make such compensation to the president, for his extraordinary attendance at 
 the bank, as shall appear to them reasonable. 
 
 5. Not less than seven directors shall constitute a board for the transaction 
 of business, of whom the president shall always be one, except in case of 
 sickness or necessary absence, in which case, his place may be supplied by 
 any other director whom he, by writing under his hand, shall depute for the 
 purpose- And the director so deputed, may do and transact all the necessary 
 business belonging to the office ot the president of the said corporation, dur- 
 ing the continuance of the sickness or necessary absence of the president. 
 
 6. A number of stockholders, not less than sixty, who, together, shall be 
 proprieters of one thousand shares or upwards, shall have power, at any time, 
 to call a general meeting of the stockholders, for purposes relative to the in- 
 stitution, giving at least ten weeks' notice in two public newspapers of the 
 place where the bank is seated, and specifying, in such notice, the object or 
 objects of such meeting. 
 
 7. Every cashier or treasurer, before he enters upon the duties of his office, 
 shall be required to give bond, with two or more sureties, to the satisfac- 
 tion of the directors, in a sum not less than titty thousand dollars, with a con- 
 dition for his good behavior and the faithful performance of his duties to the 
 corporation. 
 
 8. The lands, tenements, and hereditaments, which it shall be lawful for 
 the said corporation to hold, shall be only such as shall be requisite for its im- 
 mediate accommodation in relation to the convenient transacting of its business, 
 and such as shall have been bona Jide mortgaged to it by way of security, or 
 conveyed to it in satisfaction of debts previously contracted in the course ot 
 
PROCEEDINGS OF 1815. 501 
 
 its dealings, or purchased at sales, upon judgments which shall have been 
 obtained tor such debts. 
 
 9. The total amount of debts which the said corporation shall, at any time, 
 owe, whether by bond, bill, note, or other contract, over and above the debt 
 or debts due for money deposited in the bank, shall not exceed the sum of 
 fifty millions of dollars, unless the contracting of any greater debt shall have 
 been previously authorized by a law of the United Stales. In case of excess, 
 the directors under whose administration it shall happen, shall be liable for 
 the same, in their natural and private capacities, and an action of debt may, 
 in such case, be brought against them, or any of them, their, or any of their 
 heirs, executors, or administrators, in any court of record of the United 
 States, or either of them, by any creditor or creditors of the said corporation, 
 and may be prosecuted to judgment and execution, any condition, covenant, 
 or agreement, to the contrary notwithstanding. But this provision shall not 
 be construed to exempt the said corporation, or the lands, tenements, goods, 
 or chattels of the same, from being also liable for, and chargeable with, the 
 said excess. Such of the said directors who may have been absent when the 
 said excess was contracted or created, or who may have dissented from the 
 resolution or act whereby the same was so contracted or created, may, re- 
 spectively, exonerate themselves from being so liable, by forthwith giving 
 notice ot the fact, and of their absence or dissent, to the President of the 
 United States, and to the stockholders, at a general meeting which they shall 
 have power to call for that purpose. 
 
 10. The said corporation shall not, directly nor indirectly, deal or trade in 
 any thing, except bills of exchange, gold or silver bullion, or in the sale of 
 goods really and truly pledged for money lent and not redeemed in due time, 
 or goods which shall be the proceeds of its lands. It shall not be at liberty to 
 purchase any public debt whatsoever, nor shall it take more than at the rate 
 of six per cent, per annum, for or upon its loans or discounts. 
 
 11. The said corporation shall not, during the continuance of the present 
 war between the United States and Great Britain, sell any portion of the 
 public debt constituting a part of its capital stock aforesaid, nor at any time 
 thereafter to an amount exceeding one moiety of the public debt so constitut- 
 ing a part of its capital stock, without the consent of Congress. 
 
 12. No loan shall be made by the said corporation, for the use or on account 
 of the Government of the United States, to an amount exceeding five hundred 
 thousand dollars, or of any particular State, to an amount exceeding fifty 
 thousand dollars, or of any foreign prince or State, unless previously authoriz- 
 ed by a law of the United States. But the said corporation shall be bound to 
 lend to the Government of the United States, reimbursable at their pleasure, 
 thirty millions of dollars, at an interest not exceeding six per centum per an- 
 num, in such sums, and at such periods, as may be made convenient to the 
 Government of the United States, whenever any law or laws of the United 
 States shall authorize and require such loan or loans. 
 
 13. The stock of the said corporation shall be assignable and transferable 
 according to such rules as shall be instituted in that behalf, by the laws and 
 ordinances of the same. 
 
 14. The bills obligatory and of credit, under the seal of the said corpora- 
 tion, which shall be made to any person, or persons, shall be assignable by 
 endorsement thereupon, under the hand, or hands, of such person, or per- 
 sons, and his, her, or their executors, or administrators, and of his, her, or 
 their assignee, or assignees, and the executors, or administrators, of such as- 
 signee, or assignees, and so as absolutely to transfer and vest the property 
 thereof in each and every assignee, or assignees, successively, and to enable 
 such assignee, or assignees, and his, her, or their executors, or administra- 
 tors, to maintain an action thereupon in his, her, or their own name, or 
 names. And the bills, or notes, which may be issued by order of the said 
 corporation, signed by the president, and countersigned by the principal 
 cashier or treasurer thereof, promising the payment oF money to any person, 
 or persons, his, her, or their order, or to bearer, although not under the seal 
 
 76 
 
602 BANK OF THE UNITED STATES. 
 
 of the said corporation, shall be binding and obligatory upon the same, in the 
 like manner, and with the like force and effect, as upon any private person, 
 or persons, if issued by him, her, or them, in his, her, or their private or natu- 
 ral capacity, or capacities, and shall be assignable and negotiable in like 
 manner, as if they were so issued by such private person, or persons; that is 
 to say: those which shall be payable to any person, or persons, his, her, or 
 their order, shall be assignable by endorsement, in like manner, and with the 
 like effect, as foreign bills of exchange now are; and those which are payable 
 to bearer, shall be assignable and negotiable by delivery only. 
 
 15. Half yearly dividends shall be made of so much of the profits of the 
 bank as shall appear to the directors advisable, and once in every three years, 
 the directors shall lay before the stockholders, at a general meeting, for their 
 information, an exact and particular statement of the debts which shall have 
 remained unpaid after the expiration of the original credit, for a period of tre- 
 ble the term of that credit, arid of the surplus of profits, if any, after deduct- 
 ing losses and dividends. If there shall be a failure in the payment of any 
 part of any sum subscribed by any person, copartnership, or body politic, the 
 party failing shall lose the benefit of any dividend which may have accrued 
 prior to the time for making such payment, and during the delay of the same. 
 
 16. The directors of the said corporation shall be bound to establish a com- 
 petent office of discount and deposite in the District of Columbia, whenever 
 any law of the United States shall require such establishment; and it shall 
 be lawful for the directors of the said corporation to establish offices where- 
 soever they shall think fit, within the United States or the territories thereof, 
 for the purposes of discount, deposite, and distribution; or, for the purposes 
 
 *)f deposite and distribution only; and upon the same terms, and in the same 
 manner, as shall be practised at the bank; and to commit the management of 
 the said offices, and the business thereof, respectively, to such persons, and 
 under such regulations, as they shall deem proper, not being contrary to law 
 or to the constitution of the bank. Or, instead of establishing such offices, it 
 shall be lawful for the directors of the said corporation, from time to time, to 
 employ any other bank, or banks, at any place, or places, that they may deem 
 safe and proper, to manage and transact the business proposed, as aforesaid, 
 to be managed and transacted by such offices, under such agreements, and 
 subject to such regulations, as they shall deem just and proper. But the 
 managers, or directors, of every office of discount, deposite, ana distribution, 
 established, as aforesaid, shall be annually appointed by the directors of the 
 bank to serve one year; each of them shall be a citizen of the United States, 
 and shall hold, at the time of his appointment, not less than five shares in the 
 said bank, bona fide in his own right; and if he shall cease to be a stockhold- 
 er to that amount, he shall cease to be a manager or director of such office 
 of discount, deposite, and distribution; and not more than three fourths of 
 the said managers, or directors, in office, at the time of an annual appoint- 
 ment, shall be re-appointed for the next succeeding year; nor shall any per- 
 son be a manager, or director, for more than two out of three years; but the 
 president may be always re-appointed. 
 
 17. The said corporation, all offices of discount, deposite, and distribution, 
 and of deposite and distribution only, which shall be established by the said 
 directors, as aforesaid, and all banks by the said directors employed, in lieu 
 of such offices, as aforesaid, shall be bound to receive, upon deposite, the 
 treasury notes of the United States, which have been, or may be hereafter, 
 issued, by virtue of any law or laws of the United States. But it shall be 
 optional with the said corporation, to pay and discharge the checks, or drafts, 
 of the persons making such deposite, in treasury notes, for the amount there- 
 of, either in gold or silver coin, or in the notes of the bank, or in treasury 
 notes- And all banks, by the said directors employed, as aforesaid, in lieu 
 of offices, aforesaid, shall be further bound to receive, on deposite, and to cir- 
 culate the notes of the said corporation, on the same terms, and in the same 
 manner, as the notes of the said banks, respectively, are received and circu- 
 lated; and, from time to time, to issue and exchange for the said notes of the 
 
PROCEEDINGS OF 1815. 
 
 said corporation, other notes of the said corporation* or treasury notes, at the 
 option of the person applying for such issue or exchange. 
 
 18. Until the first Monday of April, eighteen hundred and sixteen, it shall 
 not be obligatory on the said corporation to pay its notes in specie, but all the 
 notes of the said corporation, whether payable at the seat of the bank, in Phi- 
 ladelphia, or elsewhere, shall be payable in other notes of the said corpora- 
 tion, or in treasury notes, at the option of the applicant. And, if at any time, 
 during the continuance of the present war between the United States and 
 Great Britain, and a period of one year after the termination of the said war, 
 demands shall be made, upon the said corporation, for gold or silver coin, to 
 an amount, and under circunistances, which induce a reasonable and proba- 
 ble belief that the specie capital may be greatly diminished or endangered, it 
 shall be lawful for Congress, on the petition ot the directors, to authorize the 
 suspension of specie payments, for such time or times as they may deem 
 proper. And the said corporation shall, at all times, distribute among the 
 offices and banks aforesaid, a sufficient sum, in the various denominations of 
 the notes of the said corporation, and in treasury notes, to answer the demand 
 therefor, and to establish a sufficient circulating medium throughout the 
 United States and the territories thereof; and the treasury notes to be distri- 
 buted and circulated the Secretary of the Treasury shall cause to be deliver- 
 ed, from time to time, to the said bunk at Philadelphia; and the same shall 
 be distributed and circulated by tin* said bank, under directions in that be- 
 half, given by the officer at the head of the Treasury Department: Provided* 
 That the officer at the head of the said department shall not be obliged, at any 
 time, to deposite more treasury notes for distribution than he may think ne- 
 cessary for the public interest. 
 
 19. The officer at the head of the Treasury Department of the United 
 States shall be furnished, from time to time, as often as he may require, not 
 exceeding once a week, with statements of the amount of the capital stock of 
 the said corporation, and of the debts due to the same; of the moneys depo- 
 sited therein; of the notes in circulation, and of the specie in hand; and shall 
 have a right to inspect such general accounts in the books of the bank as shall 
 relate to the said statement: Provided, That this shall not be construed to 
 imply a right of inspecting the account of any private individual or indivi- 
 duals with the bank. 
 
 SEC. 10. And be it further enacted. That, if the said corporation, or any 
 person, or persons, for or to the use of the same, shall deal or trade in buying 
 or selling any goods, wares, merchandise, or commodities, whatsoever, con- 
 trary to the provisions of this act, all, and every person, and persons, by 
 whom any order or direction for so dealing or trailing shall have been given; 
 and all, and every perbon, and persons, who shall have been concerned as 
 parties, or agents, therein, shall forfeit and lose treble the value of the goods, 
 wares, merchandises, and commodities, in which such dealing and trade shall 
 have been, one half thereof to the use of the informer, and the other half 
 thereof to the use of the United States, to be recovered in any action at law 
 with costs of suit. 
 
 SEC. 11. And be it further enacted, That, if the said corporation shall ad- 
 vance, or lend, any sum of money, for the use, or on account, of the Govern- 
 ment of the United States, to an amount exceeding five hundred thousand 
 dollars, or of any particular State, to an amount exceeding fifty thousand 
 dollars; or of any foreign Prince or State, (unless previously authorized there- 
 to by a law of the United States) all, and every person, and persons, by and 
 with whose order, agreement, consent, approbation, and connivance, such 
 unlawful advance, or loan, shall have been made, upon conviction thereof, 
 shall forfeit and pay, for every such offence, treble the value or amount of the 
 sum or sums which shall have been so unlawfully advanced, or lent, one fifth 
 thereof to the use of the informer, and the residue thereof to the use of the 
 United States. 
 
 SEC. 12. And be it further enacted, That the bills or notes of the said cor- 
 poration, originally made payable, or which shall have become payable, on 
 
604 BANK OF THE UNITED STATES. 
 
 demand, shall be receivable in all payments to the United States, unless 
 otherwise directed by act of Congress. 
 
 SEC. 13. And be it further enacted. That if the subscriptions and payments 
 to the said bank shall not be made and completed, so as to enable the same to 
 commence its operations, or if the said bank shall not commence its operations 
 on or before the first day of April, one thousand eight hundred and sixteen, 
 then, and in that case, this act shall be null and void. 
 
 SEC. 14. And be it further enacted, That it shall, at all times, be lawful for 
 a joint committee, of both Houses of Congress, appointed for that purpose, to 
 inspect the books, and to examine into the proceedings of the corporation 
 hereby created, and to report whether the provisions of this charter have been. 
 by the same, violated or not; and whenever any committee, as aforesaid, shall 
 find and report that the charter has been violated, it may be lawful for Con- 
 gress to direct a scire facias to be sued out of the circuit court of the district 
 of Pennsylvania, in the name of the United States, (which shall be executed 
 upon the president of the corporation for the time being, at least fifteen days 
 before the commencement of the term of said court) calling on the said cor- 
 poration to show cause wherefore the charter hereby granted, shall not be 
 declared forfeited; and it shall be lawful for the saia court, upon the return 
 of the said scire facias, to examine into the truth of the alleged violation, and 
 if such violation be made appear to the satisfaction of the court, the same 
 shall be certified to Congress, who shall have power, by law, to annul the 
 said charter: Provided, however, Every issue of fact which may be joined 
 between the United States and the corporation aforesaid, shall be tried by 
 jury. And it shall be lawful for the court aforesaid, to require the production 
 of such of the books of the corporation as it may deem necessary for the as- 
 certainment of the controverted facts. 
 
 SEC. 15. Jind be it further enacted, That, during the continuance of this 
 act, and whenever required by the Secretary of the Treasury, the said cor- 
 poration shall do and perform the several and respective duties of the com- 
 missioners of loans for the several States, or of any one or more of them, at 
 the times, in the manner, and upon the terms to be prescribed by the Secre- 
 tary of the Treasury. 
 
 SEC. 16. Jindbe it further enacted, That no other bank shall be establish- 
 ed, by any future law of the United States, during the continuance of the 
 corporation hereby created, for which the faith of the United States is hereby 
 pledged: Provided, Congress may renew existing charters for banks in the 
 District of Columbia, not increasing the capital thereof; and may grant char- 
 ters, if they deem it expedient, to any banking association, now in operation in 
 the said district, and renew the same, not increasing the capital thereof. And 
 notwithstanding the expiration of the term for which the said corporation is 
 created, it shall be lawful to use the corporate name, style, 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 man- 
 ner whatsoever, nor for a period exceeding two years, after the expiration of 
 the said term of incorporation. 
 
 FEBRUARY 8, 1815. 
 A motion was made, by Mr. GILES, to refer the bill to a select committee. 
 
 On this motion a wide debate took place. The argument for reference was, 
 the usage in such cases, where a bill was introduced by an individual mem- 
 ber; the argument against it was, that, though the bill was recently introduced 
 by an individual member, the subject was one which had been widely dis- 
 cussed, and was well understood by every member. 
 
 The motion to commit the bill was negatived 18 to 16. 
 
 The Senate proceeded, as in committee of the whole, Mr. ANDERSOX in the 
 chair, to the consideration of the bill. 
 
PROCEEDINGS OF 1815. 
 
 Mr. GILES moved an amendment, the object of which was to confine the 
 stock, (payable on account of subscriptions to the capital of the bank) to such 
 stock as should be hereafter created. 
 
 After an animated and interesting debate, this motion was negatived. 
 
 For the motion, 15, 
 
 Against it, 18. 
 
 FEBRUARY 10, 1815. 
 
 The Senate resumed the consideration of the bill- 
 Mr. GILES moved to strike out that part of the rules for the government of 
 the bank, which follows: 
 
 " But the said corporation shall be bound to lend to the Government of the United 
 States, reimbursable at their pleasure, thirty millions of dollars, at an interest not ex- 
 ceeding 1 six per centum per annum; in such sums, and at such periods, as may be con- 
 venient to the Government of the United States, whenever any law or laws of the 
 United States shall authorize and require such loan or loans.*' 
 
 " Until the first Monday of April, 1816, it shall not be obligatory on the said corpo- 
 ration to pay its notes in specie; but all the notes of the said corporation, whether pay- 
 able at the seat of the bank in Philadelphia, or elsewhere, shall be payable in other 
 notes of the said corporation, or in treasury notes, at the option of the applicant; and, 
 if at any time during 1 the continuance of the present war between the United States 
 and Great Britain, and a period of one year after the termination of the said war, de- 
 mand shall be made upon the said corporation for gold or silver coin, to an amount, and 
 under circumstances, which induce a reasonable and probable belief that the specie 
 capital may be greatly diminished or endangered, it shall be lawful for Congress, on 
 the petition of the directors, to authorize the suspension of specie payments, for such 
 time or times as they may deem proper. " 
 
 After much debate, the question on this motion was decided as follows: 
 YEAS. Messrs. Brown, Daggett, Dana, Fromentin, Gaillard, German, Giles, Golds- 
 borough, Gore, Hunter, King, Lambert, Mason, Thompson, Wells 15. 
 
 NATS. Messrs. Anderson, Barbour, Barry, Bibb, Chace, Condit, Howell, Kerr, 
 Lacock, Morrow, Roberts, Robinson, Smith, Talbot, Tait, Turner, Varnum, Whar- 
 ton 18. 
 
 On motion, by Mr. GORE, to amend the bill, by inserting therein a provi- 
 sion "that the authority of the bank, to pay its notes otherwise than by spe- 
 cie, shall be expressed on such note," the vote stood as follows: 
 
 YBA*. Messrs. Brown, Daggett, Dana, Fromentin, Gaillard, German, Giles, Golds- 
 borough, Gore, Hunter, Kerr, King, Lambert, Mason, Thompson 15. 
 
 NATS. Messrs. Anderson, Barbour, Barry, Bibb, Chase, Condict, Howell, La- 
 cock, Morrow, Roberts, Robinson, Smith, Talbot, Tait, Turner, Varnum, Wells, 
 Wharton 18. 
 
 On the question, " Shall the bill be engrossed and read a third time, as 
 amended?" the vote stood as follows: 
 
 YEAS Messrs. Anderson, Barbour, Barry, Bibb, Chace, Condict, Howell, Kerr, 
 Lacock, Morrow, Roberts, Robinson, Smith, Talbot, Tait, Turner, Varnum, Whar- 
 ton 18. 
 
 NATS. Messrs. Brown, Daggett, Dana, Fromentin, Gaillard, German, Giles, Golds- 
 borough, Gore, Hunter, King, Lambert, Mason, Thompson, Wells 15. 
 
 FEBRUARY 11, 1815. 
 
 The bill was read the third time; and, on the question, "Shall the bill 
 pass?" the vote stood as follows: 
 
 YEAS. Messrs. Anderson, Barbour, Barry, Bibb, Chace, Condict, Howell, Lacock, 
 Morrow, Roberts, Robinson, Smith, Talbot, Tait, Taylor, Turner, Varnum, Whar- 
 ton 18. 
 
 " NATS. Messrs. Brown, Daggett, Dana, Fromentin, Gaillard, German, Giles, 
 Goldsborough, Gore, Horsey, Hunter, Kerr, King, Lambert, Mason, Thompson 16. 
 
 So the bill was passed, and the concurrence of the House requested therein, 
 
606 BANK OF THE UNITED STATES. 
 
 HOUSE OF REPRESENTATIVES. 
 
 FEBRUARY 13, 1815. 
 
 A bill from the Senate, to incorporate the subscribers to the Bank of the 
 United States of America, was brought up, and read the first and second 
 time. 
 
 Mr. GASTON moved to refer the bill to the Committee of Ways and Means, 
 with a view to the amendment of its details; which he pronounced to be in- 
 correct, and, in many respects, impracticable. 
 
 This motion was opposed by Mr. FORSYTH, and by Mr. FISK, of N. Y. ? 
 who argued in favor of the correctness of the details of the bill, and denied 
 that any other object but delay would be answered by the proposed reference. 
 
 The motion was negatived . 
 
 Mr. SHARP then moved to refer the bill to a select committee, with the fol- 
 lowing instructions: 
 
 1. To strike out all that part of the bill that allows fifteen millions of dollars of the 
 capital of the said bank to be paid in six per cent, stock of the United States, hereto- 
 fore created, and now in the hands of stockholders; and then amend the bill, so as to 
 allow the Government to take the said fifteen millions on their account. 
 
 2. That all the Government subscriptions shall be paid in stock at five per cent, 
 interest. 
 
 3. That the Government shall have a number of directors in said bank, equal to the 
 proportion it may have of the capital of the bank; who shall be appointed by the Pre. 
 sident of the United States. 
 
 4. That, so long- as the bank shall not be required to pay specie for its notes or bills, 
 or after having 1 commenced paying 1 of specie, shall, from any cause, stop the payment 
 of the same, the Government shall not be required to pay to the bank a higher rate of 
 interest, on any loans to Government, either as permanent loans, or in anticipation of 
 loans, than four per cent. 
 
 5. That the bank shall not be allowed to sell, or transfer, any part of the Govern- 
 ment stock, that it may acquire by permanent loans to Government, until the end of 
 one year after the war. 
 
 In support of this motion, Mr. S. made a speech of nearly an hour in length. 
 Mr. FORSYTH replied to the principal points of this speech, at considerable 
 length. 
 
 Mr. SHARP explained. 
 
 Mr. OAKLEY expressed himself, in a speech of some length, as favorable to 
 some of the objects of the motion of Mr. Sharp, and as preferring them, gene- 
 rally, to the present provisions of the bill. 
 
 Mr. CALHOUN expressed himself in favor of commitment, though friendly 
 only to two of the proposed instructions, viz: the reduction of the interest on 
 loans to the Government, and striking out the old stock. He assigned the 
 reasons, also, why the plan of a bank now before the House, did not meet 
 his approbation. 
 
 Mr. HAWKINS, Mr. WRIGHT, Mr. RHEA, of Term, and Mr. FORSYTH, 
 further opposed the commitment; and Mr. OAKLEY, Mr. BOWEN, and Mr. 
 GASTON, advocated it. 
 
 The question on Mr. SHARP'S motion having been divided, the question on 
 reference to a select committee was taken, separately from the instructions 
 proposed to be given to the committee, and, 
 
 On the question of commitment, the vote stood, by yeas and nays, as fol- 
 lows: 
 
 For commitment, 75, 
 
 Against it, . 80. 
 
 Mr. GASTON then moved to refer the bill to a committee of the whole; which 
 motion was decided in the negative. 
 
PROCEEDINGS OF 1815. 
 
 Mr. SHARP then moved to amend the bill, by striking out so much as allows 
 the subscription of stock heretofore created. 
 
 This motion was supported by Mr. DUVAL, and opposed by Messrs. 
 WRIGHT and HUMPHREYS; and was negatived, by yeas and nays, by the fol- 
 lowing vote: 
 
 For the motion, 72, 
 
 Against it, 82. 
 
 Mr. SHARP then moved to amend the bill, by limiting the interest to be given 
 by the Government on loans from the bank, to four per cent; which motion 
 was also negatived, by yeas and nays, as follows: 
 
 For the motion, 74, 
 
 Against it, , 77. 
 
 FEBRUARY 17, 1815. 
 
 The House resumed the consideration of the bill. 
 Mr. FORSYTH moved to refer the bill to a select committee. 
 
 Mr. LOWNDES superseded this motion by a motion to postpone it indefi- 
 nitely. He made this motion, not from any hostility to a National Bank, 
 wishing, as the gentleman did, that a National Bank should be established; 
 but, because he wished it to be done at a time, and under circumstances, 
 which would give the House ability to decide correctly on the subject. He 
 believed, he said, and he was not alone in that opinion, that the present mo- 
 ment w,as a most unfavorable one for the establishment of a bank. It must 
 be known that, lon as the subject of a bank had been agitated, there had 
 been important differences of sentiment as to the principles of such an insti- 
 tution, which had been suppressed because of the pressure of the times. 
 Among other objections to acting on this subject at present, he said, it was no 
 trifling one, that the suspension of specie payments by the State banks, which 
 every one considered an evil, would, unquestionably, be prolonged by it. 
 In the fragment of the session which now remains, there would not be time to 
 enter into a consideration of these points; and, if there were full time, the 
 mere circumstance of the new and almost insuperable difficulties arising from 
 a new state of things which now present themselves, ought to suggest a reason 
 for postponement. Congress could not now establish a bank half so eligible, 
 or half so durable, as they could at a future session. 
 
 Mr. FORSYTH said he was perfectly aware, that the subject of a National 
 Bank was attended with great difficulty, at this or any other session; but his 
 opinion was, that this was the best time for an attempt of this kind. The sub- 
 ject had been so much discussed, that he apprehended every gentleman was 
 prepared to decide on it without much further discussion. It was from a 
 nope that all sides of the House could now come to some understanding, and 
 agree on the establishment of such an institution, as should be not only valua- 
 ble to the United States, but satisfactory to all parties, that he had now 
 moved to commit the bill, which he hoped would not be indefinitely post- 
 poned. 
 
 Mr. GASTON conceived there would be less difficulty in acting on this sub- 
 ject at the present session, than was anticipated by the gentleman from South 
 Carolina. The subject has been so repeatedly discussed, that he thought it 
 could be acted on more advantageously in the small remnant of the present 
 session, than in the first session of a new Congress, bringing together indivi- 
 duals not acquainted with each others' views, and not having the advantage of 
 hearing the subject frequently discussed. Having always been friendly to 
 such an institution, and believing it as important in peace as in war, he hoped 
 an experiment would be made, by referring this subject to a committee, which, 
 whether successful or not, would not consume much time of the House. 
 
6Q8 BANK OF THE UNITED STATES. 
 
 Mr. GROSVENOR, Mr. WRIGHT, Mr. PICKERING, and Mr. FARROW, ad- 
 vocated the postponement,' and Mr. KILBOURN, Mr. FISK, of Vermont, Mr. 
 CALHOUN, and Mr. TELFAIR, opposed it. 
 
 On the queston of postponement, which was decided by yeas and nays, the 
 vote stood as follows: 
 
 Those who voted in the affirmative, are, 
 
 Messrs. Avery, Messrs. Hale, Messrs. Roane, 
 
 Harbour, Hall, Ruggles, 
 
 Bard, Hasbrouck, Schureman, 
 
 Barnett, Hawes, Seybert, 
 
 Baylies, of Mas*. Henderson, Sheffey, 
 
 Bigelow, Hulbert, Shipherd, 
 
 Boyd, Jackson, of R. I. Slaymaker, 
 
 Bradbury, Johnson, of Ky. Smith, of N. Y. 
 
 Brigham, Kennedy, Stanford, 
 
 Champion, Kent, ofN. Y. Stockton, 
 
 Cilley, King-, of Mass. Stuart, 
 
 Clopton, Law, Taggart, 
 
 Cooper, Lowndes, Thompson, 
 
 Crawford, Macon, Troup, 
 
 Cuthbert, M'Kee, Vose, 
 
 Davenport, Montgomery, Ward, of Mast, 
 
 Desha, Moseley, Ward, of N. J- 
 
 Ely, Markell, Wheaton, 
 
 Eppes, Nelson, White, 
 
 Farrow, Ormsby, Wilcox, 
 
 Franklin, Pickering, Williams, 
 
 Geddes, Pitkin, Wilson, of Maw. 
 
 Glasgow, Potter, Winter, 
 
 Goodwin, John Reed, Wright 74. 
 
 Grosvenor, Wm. Reed, 
 
 Those who voted in the negative, are, 
 
 Messrs. Alston, Messrs. Gaston, Messrs. Parker, 
 
 Anderson, Gholson, Pearson, 
 
 Bayly, of Va. Gourdin, Pickens, 
 
 Bines, Griffin, Piper, 
 
 Bowen, Hanson, Pleasants, 
 
 Breckenridge, Hawkins, Rea, of Penn. 
 
 Brown, Hubbard, Rhea, of Tenn. 
 
 Butler, Hungerford, Rich, 
 
 Caperton, Ingersoll, Ringgold, 
 
 Calhoun, Ingham, Robertson, 
 
 Cannon, Jackson, of Va. Sage, 
 
 Clendenin, Kent, of Md. Sevier, 
 
 Comstock, Kerr, Sharp, 
 
 Connard, Kershaw, Sherwood, 
 
 Cox, Kilbourn, Smith, of Vir. 
 
 Creighton, Lefferts, Strong 
 
 Crouch, Lewis, Sturges, 
 
 Culpeper, Lovett, Tannehill, 
 
 Duval, Lyle, Taylor, 
 
 Earle, M'Coy, Telfair, 
 
 Findley, M'Lean, Udree, 
 
 Fisk, of Vt. Moore, Wilson, of Pa. 
 
 Fisk, of N. Y. Murfree, Wood, 
 
 Forney, Newton, Yancey 73. 
 
 Forsyth, 
 
 So the bill was indefinitely postponed. 
 

 CHAPTER V. 
 
 PROCEEDINGS AND DEBATES ON THE GRANT OF THE CHARTER OF 1816, 
 
 HOUSE OF REPRESENTATIVES. 
 
 DECEMBER 5, 1815. 
 Extract from the annual message of JAMKS MADISON, President of the Untied States. 
 
 " The arrangements ol the finances, with a view to the receipts and expen- 
 ditures of a permanent peace establishment, will necessarily enter into the 
 deliberations of Congress during the present session. It is true, that the im- 
 proved condition of the public revenue will not only afford the means of main- 
 taining the faith of the Government with its creditors inviolate, and of prose- 
 cuting successfully the measures of the most liberal policy, but will also jus- 
 tify an immediate alleviation of (he burdens imposed by the necessities of the 
 war. It is, however, essential to every modification of the finances, that the 
 benefits of an uniform national currency should be restored to the community. 
 The absence of the precious metals will, it is believed, be a temporary evil; 
 but, until they can again be rendered the general medium of exchange, it de- 
 volves on the wisdom of Congress to provide a substitute, which shall equally 
 engage the confidence, and accommodate the wants of the citizens throughout 
 the Union. If the operation of the State banks cannot produce this result, 
 the probable operation of a national bank will merit consideration; and if 
 neither of these expedients be deemed effectual, it may become necessary to 
 ascertain the terms upon which the notes of the Government (no longer re- 
 quired as an instrument of credit) shall be issued, upon motives of general po- 
 licy, as a common medium of circulation." 
 
 DECEMBER 6, 1815. 
 
 Resolved, That so much of the President's message as relates to an uniform 
 national currency, be referred to a select committee. 
 
 Ordered, That Mr. Calhoun, of S. C. Mr. Macon,of N. C. Mr. Pleasants, 
 of Va. Mr. Hopkinson, of Pa. Mr. Robertson, of La. Mr. Tucker, of Va. 
 and Mr. Pickering, of Mass, be the said committee. 
 
 DECEMBER 7, 1815. 
 
 The Speaker laid before the House a letter from the Secretary of the Trea- 
 sury, transmitting his annual report on the state of the finances, of which, so 
 much thereof as relates to a national currency, was referred to the committee 
 on that subject. 
 
 The following are the parts of the said report alluded to, containing sug- 
 gestions on the currency, and a proposition for the establishment of a bank: 
 
 PROPOSITION OF MR. DALLAS, RELATING TO THE NATIONAL CIRCU- 
 LATING MEDIUM. 
 
 The delicacy of this subject is only equalled by its importance. In pre- 
 senting it, therefore, to the consideration of Congress, there is occasion for an 
 implicit reliance upon the legislative indulgence. 
 
 77 
 
BANK OF THE UNITED STATES. 
 
 By the constitution of the United States, Congress is expressly vested with 
 the power to coin money , to regulate the value of the domestic and foreign 
 coins in circulation, and (as a necessary implication from positive provisions) 
 to emit bills of creuitj while it is declared, by the same instrument, that " no 
 State shall coin money, or emit bills of credit."* Under this constitutional 
 authority, the money of the United States has been established by law, con- 
 sisting of coins made with gold, silver, or copper. | All foreign gold and sil- 
 ver coins, at specified rates, were placed, in the first instance, upon the same 
 footing with the coins of the United States; but they ceased (with the excep- 
 tion ot Spanish milled dollars, and parts of such dollars) to be a legal tender 
 for the payment of debts and demands, in the year 18094 
 
 The constitutional authority to emit bills of credit, has also been exercised 
 m a qualified and limited manner. During the existence of the Bank of the 
 United States, the bills or notes of the corporation were declared by law to 
 be receivable in all payments to the United States; and the treasury notes 
 which have been since issued for the sen ices of the late war, have been en- 
 dowed with the same quality. But Congress has never recognised, by law, 
 the notes of any other corporation, nor has it ever authorized an issue of bills 
 of credit to serve as a ie^al currency. The acceptance of the notes of banks 
 which are not established by the federal authority, in payments to the United 
 States, has been properly left to the vigilance and discretion of the Executive 
 Department; while the circulation of the treasury notes, employed either to 
 borrow money or to discharge debts, depends entirely (as it ought to depend) 
 upon the option ot the lenders and creditors to receive them. 
 
 The constitutional and legal foundation of the monetary system of the 
 United States, is thus distinctly seen; and the power of the Federal Govern- 
 ment to institute and regulate it, whether the circulating medium consist of 
 coin, or of bills of credit, must, in its general policy, as well as in the terms 
 of its investment, be deemed an exclusive power. It is true, that a system 
 depending upon the agency of the precious metals, will be aftected by the va- 
 rious circuinstances which diminish their quantity or deteriorate their quality. 
 The coin of a State sometimes vanishes under the influence of political alarms: 
 sometimes in consequence of the explosion of mercantile speculations; and 
 sometimes by the drain of an unfavorable course of trade. But, whenever 
 the emergency occurs that demands a change of system, it seems necessarily 
 to follow, that the authority which was alone competent to establish the na- 
 tional coin, is alone competent to create a national substitute. It has happen- 
 ed, however, that the coin of the United States has ceased to be the circulat- 
 ing medium of exchange, and that no substitute has hitherto been provided 
 by the national authority. During the last year, the principal banks establish- 
 ed south and west of New England, resolved that they would no longer issue 
 coin in payment of their notes, or of the drafts of their customers for money 
 received upon deposite. In this act, the Government of the United States had 
 no participation; and yet the immediate effect of the act was to supersede the 
 only legal currency of the nation. By this act, although no State can consti- 
 tutionally emit bills of credit, corporations, erected by the several States, 
 have been enabled to circulate a paper medium, subject to many of the practi- 
 cal inconveniences of the prohibited bills of credit. 
 
 [t is not intended, upon this occasion, to condemn, generally, the suspen- 
 sion of specie payments: for appearances indicated an approaching crisis, 
 which would, probably, have imposed it as a measure of necessity, if it had 
 not been adopted as a measure of precaution. But the danger which origi- 
 nally induced, and perhaps justified the conduct of the banks, has passed 
 away, and the continuance of the suspension of specie payments, must be as- 
 cribed to a new series of causes. The public credit and resources are no 
 longer impaired by the doubts and agitations excited during the war -by the. 
 
 * Constitution, art. 1, sec. 8, 10. 
 
 f See 2vol. 37, 120, 158, 161: 3 vol. 7, 22!, 31C: 1 vol. 62, .T/5, 395 
 
 See2vol. 161: 4vol. 02: 8 vol. CG. 
 
ON TIIK GUAM OK THE CHAKTKU ()! ISlfi. ^ j ) 
 
 practices oi " ;ui enemy, or by the inroads of an illicit commerce. Vet, the 
 resumption of specie payments is still prevented, either by the reduced state 
 of the national stock of 'the precious metals, or by the apprehension of a fur- 
 ther reduction to meet the balances of foreign trade, or by the redundant issues 
 oKJjank paper. The probable direction and duration of those latter causes. 
 constitute, therefore, the existing subject for deliberation. While they con- 
 tinue to operate, singly or combined, the authority of the States, individually, 
 or the agency of the State institutions, cannot afford a remedy commensurate 
 with the evil, and a recurrence to the national authority is indispensable for 
 the restoration of a national currency. 
 
 In the selection of the means for the accomplishment of this important ob- 
 ject, it may be asked, 1st, whether it be practicable to renew the circulation 
 of the gold and silver coins? 2dly, whether (lie State banks can be success- 
 fully employed to furnish a uniform currency? 3dly, whether a national bunk 
 can be employed more advantageously than the State banks for the same pur- 
 pose? And 4thly, whether the Government can, itself, supply and maintain 
 a paper medium of exchange, of permanent and uniform value throughout the 
 United Stale.-:- 
 
 1st. As the United States do no lines of sold or silver, the supply 
 
 of those metals must, in a time of scarcity, be derived from foreign com- 
 merce. If the balance of foreign commerce be unfavorable, the supply will 
 not be obtained incidentally, as in the case >f the returns for a surplus of 
 American exports, but must be tho subject of a direct purchase. The pur- 
 chase of bullion is, however, a common operation of commerce, and depend-. 
 like other operations, upon the inducements to import the article, 
 
 The inducements to import bullion arise, as in other cases, from its being 
 < heap abroad, or from its being dear at home. Notwithstanding the commo- 
 tions in South America, as well as in Kurope, there is no reason to believe, 
 that the quantity of the precious metals is now (mare than jit any former period) 
 insufficient for the demand throughout the commercial and civilized world. 
 The price may be higher in some countries than in others, and it may be dif- 
 ferent in the same country at different times; but, generally, the European 
 stock of gold and silver has been abundant, even during the protracted war 
 which has afflicted the nations of Kurope. 
 
 The purchase of bullion in foreign markets, upon reasonable terms, is then 
 deemed practicable: nor can its importation into the United States, fad, even- 
 tually, to become profitable. The actual price of gold and silver, in the Ame- 
 rican market, would, in itself, aftbrd, for some time, an ample premium, al- 
 though tiie fall in the price must, of course, be proportionable to the increase 
 ol the quantity. But it i> within the scope of a wise policy, to create addi- 
 tional demands for coin, and in that way, to multiply the inducements to im- 
 port and retain the metals of which it is composed. For instance: the exces^ 
 sive issue of bank paper has usurped the place of the national money; and, 
 under such circumstances, gold and silver will always continue to be treated 
 us an article of merchandise; but, it is hoped that the issue of bank paper 
 will be soon reduced to its just share in the circulating medium of the coun- 
 try; and consequently, that the coin of the United States will resume its le- 
 gitimate capacity and character. Again: The treasury, yielding from neces- 
 sity to the general impulse, has hitherto consented to receive bank paper in 
 payment ot duties and taxes; but, the period approaches, when it will proba- 
 bly become a duty to exact the payment, cither in treasury notes, or in gold 
 or silver coin, the lawful money of the United States. Again: The institu- 
 tions which shall be deemed proper, in order to remove existing inco'hvenien- 
 ces, and to restore the national currency, may be so organized as to engage 
 the interests and enterprise of individuals, in providing the means to establish 
 them. And, finally, such regulations maybe imposed upon the exportation 
 ot gold and silver, as will serve, in future, to fix and retain the quantity re- 
 quired for domestic uses. 
 
 But it is further believed, that the national stock of the precious metals is 
 not so reduced as to render the operation of reinstating their agency in the 
 
BANK OF THE UNITED STATES. 
 
 national currency, either difficult or protracted. The quantity actually pos- 
 sessed by the country, is considerable; and the resuscitation of public confi- 
 dence in bank paper, or in other substitutes for coin, seems alone to be want- 
 ing, to render it equal to the accustomed contribution for a circulating me- 
 dium. In other countries, as well as in the United States, the effect of an 
 excessive issue of paper money, to banish the precious metals, has been seen r 
 and under circumstances much more disadvantageous than the present; the 
 effect of public confidence in national institutions to recall the precious metals 
 to their uses in exchange, has also been experienced. 
 
 Even, however, if it were practicable, it has sometimes been questioned 
 whether it would be politic, again to employ gold and silver for the purposes 
 of a national currency. It was long and universally supposed ? that, to main- 
 tain a paper medium, without dereciation, the certainty of being able to con- 
 vert it into coin, was indispensable; nor can the experiment which has given 
 rise to a contrary doctrine, be deemed complete or conclusive. But, what- 
 ever may be the issue of that experiment elsewhere, a difference in the struc- 
 ture of the Government, in the physical as well as political situation of the 
 country, and in the various departments of industry, seems to deprive it of 
 any important influence as a precedent for the imitation of the United States. 
 
 In offering these general remarks to the consideration of Congress, it is not 
 intended to convey an opinion that the circulation of the gold and silver coins* 
 can at once be renewed. Upon motives of public convenience, the gradual 
 attainment of that object isalone contemplated; but a strong, though respect- 
 ful solicitude is felt, that the measures adopted by the Legislature, should in- 
 variably tend to its attainment. 
 
 2d. Of the services rendered to the Government by some of the State banks, 
 during the late war, and of the liberality by which some of them are actuated 
 in their intercourse with the treasury, justice requires an explicit acknowledg- 
 ment. It is a fact, however, incontestibly proved, that those institutions can- 
 not, at this time, be successfully employed to furnish a uniform national cur- 
 rency. The failure of one attempt to associate them, with that view, has al- 
 ready been stated. Another attempt, by their agency, in circulating treasury 
 
 affairs of the banks, and to give to each bank a legitimate share in the circula- 
 tion, is not likely to receive the general sanction of the banks. The truth is, 
 that the charter restrictions of some of the banks, the mutual relation and de- 
 pendence of the banks of the same State, and even of the banks of the differ- 
 ent States, arid the duty which the directors of each bank conceive they owe 
 to their immediate constituents, upon points of security or emolument, inter- 
 pose an insuperable obstacle to any voluntary arrangement,, upon national con- 
 siderations alone, for the establishment of a national medium, through the 
 agency of the State banks. It is, nevertheless, with the State banks, that the 
 measures for restoring the national currency of gold and silver must originate: 
 for, until their issues of paper be reduced, their specie capitals be reinstated, 
 and their specie operations be commenced, there will be neither room, nor 
 employment, nor safety, for the introduction of the precious metals. The 
 policy and the interest of the State banks must, therefore, be engaged in the 
 great fiscal work, by all the means which the treasury can employ, or the le- 
 gislative wisdom shall provide. 
 
 3d. The establishment of a national bank is regarded as the best, and per- 
 haps the only adequate resource, to relieve the country and the Goverment 
 from the present embarrassments; authorized to issue notes, which will be 
 received in all payments to the United States, the circulation of its issues will 
 be co-extensive with the Union; and there will exist a constant demand, bear- 
 ing a just proportion to the annual amount of the duties and taxes to be col- 
 lected, independent of the general circulation, for commercial and social pur- 
 poses. A national bank will, therefore, possess the means and the opportunity 
 of supplying a circulating medium, of equal use and value in every State, ami 
 
ON THE GRANT OF THE CHAKTKK OF 1816. 
 
 in every district of every State. Established by the authority of the Govern- 
 ment of the United States; accredited by the Government, to the whole 
 amount of its notes in circulation; and entrusted as the depository of the Go- 
 vernment, with all the accumulations of the public treasure; the national 
 bank, independent of its immediate capital, will enjoy every recommendation 
 which can merit and secure the confidence of the public. Organized upon 
 principles of responsibility, but of independence, the national bank will be 
 retained within its legitimate sphere of action, without just apprehension from 
 the misconduct of its directors, or from the encroachments of the Govern- 
 ment. Eminent in its resources and in its example, the national bank will 
 conciliate, aid, and lead, the State banks, in all that is necessary for the res- 
 toration of credit, public and private. And, acting upon a compound capital, 
 partly of stock and partly of gold ami silver, the national bank will be the 
 ready instrument to enhance the value of the public securities, and to restore 
 the currency of the national coin. 
 
 4th. The power of the Government to supply and maintain a paper medium 
 of exchange, will not be questioned; but, for the introduction of that medium, 
 there must be an adequate motive. The sole motive for issuing treasury notes, 
 has hitherto been to raise money in anticipation of the revenue. The revenue, 
 however, will probably become, in the course of the year 1816, and continue 
 afterwards, sufficient to discharge all the debts, and to defray all the expenses 
 of the Government, and, consequently, there will exist no motive to issue the 
 paper of the Government as an instrument of credit. 
 
 It will not be deemed an adequate object for an issue of the paper of the Go- 
 vernment, merely that it may be exchanged for the paper of the banks; since 
 the treasury will be abundantly supplied with bank paper, by the collection of 
 the revenue, and the Government cannot be expected to render itself a gene- 
 ral debtor, in order to become the special creditor of the Stale banks. 
 
 The co-operation of the Government with the national bank, in the intro- 
 duction of a national currency, may, however, be advantageously employed, 
 by issues of treasury note*, so long as they shall be required for the public 
 service. 
 
 Upon the whole, the state of the national currency, and other important 
 considerations connected with the operations of the treasury, render it a duty 
 respectfully to propose, 
 
 That a national bank be established at the city of Philadelphia, having power 
 to erect branches elsewhere, and that the capital of the bank (being of a com- 
 petent amount) consist, three-fourths of the public stock, and one-fourth of 
 gold and silver. 
 
 All which is respectfully submitted. 
 
 A. J. DALLAS, 
 Secretary of the Treasury. 
 
 TREASURY DEPARTMENT, December 6, 1815. % 
 
 The Committee on a National Currency having directed their chairman to 
 address a letter to the Secretary of the Treasury, requesting his views upon 
 certain points relating to the currency, the Secretary, on the 24th December, 
 1815, addressed to Mr. CALHOUN, as chairman, the following letter: 
 
 Letter from the Secretary of the Treasury to the Chairman of the Committee, 
 on that part of the President's message which relates to an uniform na- 
 tional currency; enclosing an outline of a plan for a National Bank, 
 accompanied ivith some explanation of the principles upon which the system 
 is founded. 
 
 TREASURY DEPARTME^F, December 24, 1815. 
 
 SIR: I have the honor to acknowledge the receipt of your letter, dated the 
 23d instant, informing me " that the committee on so much of the President's 
 message as relates to the national currency, had determined that a National 
 
514 BANK OF THE UNITED STATES. 
 
 Bank is the most certain means of restoring to the nation a specie circulation;*' 
 and had directed you to obtain the opinion of this Department on the following 
 j mints: 
 
 1. The amount and composition of the capital of the bank; 
 
 2. The government of the bank; 
 
 3. The privileges and duties of the bank; 
 
 4. The organisation and operation of the bank; 
 
 5. The bonus to be required for the charter of the bank: 
 
 6. The measures which may aid the bank in commencing and maintaining 
 
 its operations in specie. 
 
 It affords much satisfaction to find, that the policy of establishing a National 
 Bank has received the sanction of the committee; and the decision, in this 
 respect, renders it unnecessary to enter into a comparative examination of the 
 superior advantages of such an institution, for the attainment of the objects 
 contemplated by the Legislature. Referring, therefore, to the outline of a 
 National Bank, which is subjoined to this letter, as the result of an attentive 
 consideration bestowed upon the subjects of your inquiry, I proceed, with de- 
 ference and respect, to otter some explanation of the principles upon which 
 the system is founded: 
 
 {. It is proposed that, under a charter for twenty years, the capital of the 
 National Bank shall amount to thirty -five millions of dollars; that Congress 
 shall retain the power to raise it to fifty millions of dollars; and that it shall 
 consist of three fourths of public stock, and one fourth of gold and silver. 
 
 1. With respect to the amount of the capital. The services to be performed 
 by the capital of the bank, are important, various, and extensive. They will 
 be required through a period almost as long as is usually assigned to a genera- 
 tion. They will be required for the accommodation of the Government, in 
 the collection and distribution of its revenue, as well as for the uses of com- 
 merce, agriculture, manufactures, and the arts, throughout the Union. They 
 will be required to restore and maintain the national currency; and, in short, 
 they will be required, under every change of circumstances, in a season of 
 war as well as in the season of peace, for the circulation of the national 
 wealth; which augments with a rapidity beyond the reach of ordinary cal- 
 culation. 
 
 In the performance of these national services, the local and incidental co- 
 operation of the State banks may undoubtedly be expected; but it is the ob- 
 ject of the present measure, to create an independent, though not a discordant, 
 institution; and while the Government is granting a monopoly for twenty 
 years, it would seem to be improvident and dangerous to rely upon gratuitous 
 or casual aids for the enjoyment of those benefits which can be effectually se- 
 cured by positive stipulation. 
 
 Nor is it believed that any public inconvenience can possibly arise from 
 the proposed amount of the capital of the bank, with its augmentable quality. 
 The amount may, indeed, be a clog upon the profits of the institution; but. it 
 can never be employed for any injurious purpose, (not even for the purpose of 
 discount accommodation beyond the fair demand) without an abuse of trust, 
 which cannot, in candor, be anticipated; or which, if anticipated, may be made 
 an object of penal responsibility. 
 
 The competition which exists at present among the State banks, will, it is 
 true, be extended to the National Bank; but competition does not imply hos- 
 tility. The commercial interests, and the personal association of the stock- 
 holders, will generally be the same, in the State banks and in the National 
 Bank. The directors of both institutions will naturally be taken from the 
 same class of citizens; and experience has shown, not only the policy, but 
 the existence of those sympathies, by which the intercourse of a National Bank 
 and the State banks has been, and always ought to be, regulated, for their com- 
 mon credit and security. At the present crisis, it will be peculiarly incum- 
 bent upon the National Bank, as well as the Treasury, to conciliate the State 
 banks; to confide to them, liberally, a participation in the deposites of public 
 revenue; and to encourage them, in every reasonable effort, to resume the 
 
ON THE GRANT OF THE CHARTER OF 1816. 
 
 payment of their notes in coin. But, independent of these considerations, it 
 is to be recollected that, when portions of the capital of the National Bank 
 shall be transferred to its branches, the amount invested in each branch will 
 not, probably, exceed the amount of the capital of any of the principal State 
 banks; and will certainly be less than the amount of the combined capital of 
 the State banks, operating in any of the principal commercial cities. The 
 whole number of the banking establishments in the United States may be 
 stated at two hundred and sixty; and the aggregate amount of their capitals 
 maybe estimated at eighty-five millions ot dollars; but the services of the 
 National Bank are also required in every State and Territory, and the capital 
 proposed is thirty-five millions of dollars, of which only one fourth part will 
 consist of gold and silver. 
 
 2. With respect to the composition of the capital of the bank. There does 
 not prevail much diversity of opinion upon the proposition to form a compound 
 capital for the National Bank, partly of public stock and partly of coin. The 
 proportions now suggested, appear, also, to be free from any important objec- 
 tions. Under all the regulations of the charter, it is believed that the amount 
 of gold and silver required, will aftbrd an adequate supply for commencing 
 and continuing the payments of the bank in current coin; ^yhile the power 
 which the bank will possess, to convert its stock portion of capital into bullion 
 or coin, from time to time, is calculated to provide for any probable augmenta- 
 tion of the demand. This object being sufficiently secured, the capital of the 
 bank is next to be employed, in perfect consistency with the general interests 
 and safety of the institution, to raise the value of the public securities, by with- 
 drawing almost one fifth of the amount from the ordinary stock market. Nor 
 will the bank be allowed to expose the public to the danger of a depreciation, 
 by returning any part of the stock to the market, until it has been ottered, at 
 the current price, to the commissioners of the sinking fund; and it is not an 
 inconsiderable advantage, in the growing state of the public revenue, that the 
 stock subscribed to the capital of the bank, will become redeemable at the 
 pleasure of the Government. 
 
 The subscription to the capital of the bank, is opened to every species of 
 funded stock. The estimate, that the revenues of 1816 and 1817 will enable 
 the Treasury to discharge the whole of the treasury note debt, furnishes tin- 
 only reason for omitting to authorise a subscription in that species of debt. 
 Thus 
 
 The old and the new six per cent, slocks are receivable at par. 
 
 The seven per cent, stock, upon a valuation referring to the 30th of Septem- 
 ber, 1816, is receivable at $106.51 per cent. 
 
 The three per cent, stock, which can only be redeemed for its nominal or 
 certificate value, may be estimated, under all circumstances, to be worth 
 about sixty -two per cent, when the ^ix per cent, stock is at par; but, as it is 
 desirable to accomplish the redemption of this stock upon equitable terms, it 
 is made receivable at sixty-five per cent, the rate sanctioned by the Govern- 
 ment, and in part accepted by the stockholders, in the year 1807. 
 
 Of the instalments for paying the subscriptions, it is only necessary to ob- 
 serve, that they are regulated by a desire to reconcile an early commencement 
 of the operations of the bank, with the existing difficulties in the currency, and 
 with the convenience of the subscribers. In one of the modes proposed for 
 discharging the subscription of the Government, it is particularly contem- 
 plated to aid the bank with a medium which cannot fail to alleviate the first 
 pressure for payments in coin. 
 
 II. It is proposed that the National Bank shall be governed by twenty-five 
 directors, and each of its branches by thirteen directors; that the President of 
 the United States, with the advice and consent of the Senate, shall appoint 
 live of the directors of the bank, one of whom shall be chosen as President of 
 the bank, by the board of directors; that the resident stockholders shall elect 
 twenty of the directors of the National Bank, who shall be resident citizens of 
 the United States; and that the National Bank shall appoint the directors of 
 each branch, (bein^ resident dti'/.eiiv of the United Stales) one of whom shall 
 
BANK OF THE UNITED STATES. 
 
 be designated by the Secretary of the Treasury, with the approbation of the 
 President of the United States, to be President of the branch bank. 
 
 The participation of the President and Senate of the United States, in the 
 appointment of directors, appears to be the only feature in the proposition for 
 the government of the National Bank, which requires an explanatory remark. 
 
 Upon general principles, wherever a pecuniary interest is to be effected by 
 the operations of a public institution, a representative authority ought to be 
 recognised, The United States will be the proprietors of one fifth of the ca- 
 pital of the bank, and in that proportion, upon general principles, they should 
 be represented in the direction. But an apprehension has sometimes been ex- 
 pressed, lest the power of the Government, thus inserted into the administra- 
 tion of the affairs of the bank, should be employed eventually to alienate the 
 funds and destroy the credit of the institution. Whatever may have been the 
 fate of banks in other countries^ subject to forms of government essentially 
 different, there can be no reasonable cause for the apprehension here. Inde- 
 pendent of the obvious improbability of the attempt, the Government of the 
 United States cannot, by any legislative or executive act, impair the rights 
 or multiply the obligations of a corporation, constitutionally established, as 
 long as the independence and integrity of the judicial power shall be main- 
 tained. Whatever accommodation the Treasury may have occasion to ask 
 from the bank, can only be asked under the licence of a law; and whatever 
 accommodation shall be obtained, must be obtained from the voluntary assent 
 of the directors, acting under the responsibility of their trust. 
 
 Nor can it be doubted that the department of the Government, which is in- 
 vested with the power of appointment to all the important offices of the state, 
 is a proper department to exercise the power of appointment in relation to a 
 national trust of incalculable magnitude. The National Bank ought not to be 
 regarded simply as a commercial bank. It will not operate upon the funds 
 of the stockholders alone, but much more upon the funds of the nation. Its 
 conduct, good or bad, will not affect the corporate credit and resources alone, 
 but much more the credit and resources of the Government. In fine, it is not 
 an institution created for the purposes of commerce and profit alone, but much 
 more for the purposes of national policy, as an auxiliary in the exercise of 
 some of the highest powers of the Government. Under such circumstances, 
 the public interests cannot be too cautiously guarded, arid the guards pro- 
 posed can never be injurious to the commercial interests of the institution. 
 The right to inspect the general accounts of the bank may be employed to 
 detect the evils of a mal -administration, but an interior agency in the direc- 
 tion of its affairs, will best serve to prevent them. 
 
 III. It is proposed that, in addition to the usual privileges of a corporation, 
 the notes of the National Bank shall be received in all payments to the United 
 States, unless Congress shall hereafter otherwise provide by law; and that, 
 in addition to the duties usually required from a corporation of this descrip- 
 tion, the National Bank shall be employed to receive, transfer, and distribute, 
 the public revenue, under the directions of the proper department. 
 
 The reservation of a legislative power on the subject of accepting the notes 
 of the National Bank, in payments to the Government, is the only new stipu- 
 lation in the present proposition. It is designed not merely as one of the se- 
 curities for the general conduct of the bank, but as the means of preserving 
 entire the sovereign authority of Congress, relative to the coin and currency 
 of the United States. Recent occurrences inculcate the expediency of such 
 a reservation, but it may be confidently hoped that an occasion to enforce it 
 will never arise. 
 
 It is not proposed to stipulate that the bank shall, in any case, be bound 
 to make loans to the Government; but, in that respect, whenever a loan is 
 authorized by law, the Government will act upon the ordinary footing of an 
 applicant for pecuniary accommodation. 
 
 IV. It is proposed that the organization of the National Bank shall be 
 effected \yith as little delay as possible; and that its operations shall commence 
 and continue, upon the basis of payments in the current coin of the United 
 
ON THE GRANT OF THE C'HAKTKK O*' 1816. 
 
 State*, \vith a qualified power under the authority of the Government to sus- 
 pend such payments. 
 
 The proposition now submitted, necessarily implies an opinion that it is 
 practicable to commence the operations of the National Bank upon a circula- 
 tion of gold and silver coin; and in support of the opinion, a few remarks are 
 respectfully offered to the consideration of the committee. 
 
 1. The actual receipts of the bank, at the opening of the subscription, will 
 amount to the sum of $8,400,000; of which the sum of $1,400,000 will consist 
 of gold and silver, and the sum of $7,000,000 will consist of public stock, con- 
 vertible, by sale, into gold and silver. But the actual receipts of the bank, 
 at the expiration of six months from the opening; of the subscription, will 
 amount to the sum of $16,800,000; of which the sum of $-2,800,000 will be in 
 
 old and silver, and the sum of $14,000,000 will be in public stock, converti- 
 le by sale into gold and silver. To the fund, thus possessed by the bank, 
 the accumulations of the public revenue and the deposites of individuals being 
 added, there can be little doubt, from past experience and observation in re- 
 ference to similar establishments, that a sufficient foundation will exist for a 
 gradual and judicious issue of bank notes, payable on demand in current coin; 
 unless, contrary to all probability, public confidence should be withheld from 
 the institution: or sinister combinations Jiould be formed to defeat its opera- 
 tions; or the demands of an unfavorable balance of trade should press upon 
 its metallic resources. 
 
 4 J. The public confidence cannot be withheld from the institution. The 
 resources of the nation will be intimately connected with the resources of 
 the bank. The notes of the bank arc accredited in every payment to the 
 Government, and must become familiar in every pecuniary negotiation. Un- 
 less, therefore, a state of things exist in which gold and silver only can com- 
 mand the public confidence, the National Bank must command it. But the 
 expression of the public sentiment does not, even at this period, leave the 
 question exposed to difficulty and doubt; it is well known, that the wealth of 
 opulent and commercial nations, requires for its circulation something more 
 than a medium composed of the precious metals. The incompetence of the 
 existing paper substitutes, to furnish a national currency, is also well known. 
 Hence, throughout the United States, the public hope seems to rest, at this 
 crisis, upon the establishment of a National Bank; and every citizen, upon 
 private or upon patriotic motives, will be prepared to support the institution. 
 
 3. Sinister combinations to defeat the operations of a National Bank, ought 
 not to be presumed, and need not be feared. It is true, that the influence of 
 the State banks is extensively diffused; but the State banks, and the patrons 
 of the State banks, partake of the existing evils; they must be conscious of 
 the inadequacy of State institutions to restore and maintain the national cur- 
 rency; they will perceive that there is sufficient space in the commercial 
 sphere, for the movement of the State banks and the National Bank; and, 
 upon the whole, they will be ready to act upon the impulse of a common duty, 
 and a common interest. If, however, most unexpectedly, a different course 
 should be pursued, the concurring powers of the National Treasury and the 
 National Bank will be sufficient to avert the danger. 
 
 4. The demand of an unfavorable balance ot trade apoears to be much 
 overrated. It is not practicable, at this time, to ascertain either the value, of 
 the goods imported since the peace, or the value of the property employed to 
 {>ay for them. But when it is considered that a great proportion of the im- 
 portations arose from investments of American funds previously in Europe; 
 that a great proportion of the price has been paid by American exports; that 
 a great proportion has been paid by remittances in American stocks; and that 
 a great proportion remains upon credit, to be paid by gradual remittances cf 
 goods, as well as in coin; it cannot be justly concluded, that the balance of 
 trade has hitherto materially affected the national stock of the precious metals. 
 So far as an opportunity has occurred for observation, the demand for gold 
 and silver to export, appears rather to have arisen from the expectation of ob- 
 taining a higher price in a part of Europe, and from the revival of commerce 
 
 78 
 
618 BANK OF THE UNITED STATES. 
 
 with the countries beyond the Cape of Good Hope, than from any necessity 
 to provide for the payment of the recent importations of goods into the United 
 States. The former of these causes will probably soon cease to operate; and 
 the operation of the latter, may, if necessary, be restrained by law. 
 
 The proposition now under consideration further provides for a suspension 
 of the bank payments in coin upon any future emergency. This is merely a 
 matter of precaution; but, if the emergency should arise, it must be agreed 
 on all hands that the power of suspension ought rather to be confided to the 
 Government, then to the directors of this institution. 
 
 V. It is proposed that a bonus be paid to the Government by the subscribers 
 to the National Bank, in consideration of the emoluments to be derived from 
 an exclusive charter, during a period of twenty years. 
 
 Independent of the bonus, here proposed to be exacted, there are undoubt- 
 edly many public advantages to be drawn from the establishment of the 
 National Bank; but these are generally of an incidental kind, and (as in the 
 case of the deposites and distribution of the revenue) may be regarded in the 
 light of equivalents, not for the monopoly of the charter, but for the reci- 
 procal advantages of a fiscal connexion with the public treasury. 
 
 The amount of the bonus should be in proportion to the value of the charter 
 grant, or, in other words, to the nett profits which the subscribers will pro- 
 bably make, in consequence of their incorporation. The average rate of the 
 dividends of the State banks,, before the suspension of payments in coin, was 
 about eight per cent, per annum. It appears by a report from this department 
 to the House of Representatives, dated the 3d of April, 1810, that the annual 
 dividends of the late Bank of the United States averaged, throughout the 
 duration of its charter, the rate of 8 13-36 per cent. But, under all the circum- 
 stances which will attend the establishment and operations of the proposed 
 National Bank, its enlarged capital, and the extended field of competition, 
 it is not deemed reasonable, for the present purpose, to rate the annual divi- 
 dends of the institution higher than seven per centum upon its capital of 
 35, 000,000 of dollars. 
 
 Allowing, therefore, two, three, and four years for the payment of the 
 bonus, a sum of 1, 500,000 dollars would amount to about 4 per cent, upon the 
 capital of the bank; and would constitute a just equivalent for the benefits of 
 its charter. 
 
 VI. It is proposed that the measures suggested by the following considera- 
 tions, be adopted, to aid the National Bank in commencing and maintaining, 
 its operations upon the basis of payments in the current coin. 
 
 1. To restore the national currency of gold and silver, it is essential that the 
 quantity of bank paper in circulation should be reduced; but this effort alone 
 will be sufficient to effect the object. By reducing the amount of bank paper, 
 its value must be proportionally increased; and as soon as the amount shall be 
 contracted to the limits of a just proportion in the circulating medium of the 
 country, the consequent revival of the uses for coin, in the business of ex- 
 change, will ensure its re-appearance in abundance. The policy, the interest,, 
 and the honor of the State banks, will stimulate them to undertake and to 
 prosecute this salutary work. But it will be proper to apprise them that, after 
 a specified day, the notes of such banks as have not resumed their payments in 
 the current coin, will not be receive! I in payments, either to the Government 
 or to the National Bank. 
 
 2. The resumption of payments in current coin, at the State banks, will re- 
 move every obstacle to the commencement of similar payments at the Na- 
 tional Bank. The difficulty of commencing payments in coin is not, how 
 ever, to be considered as equal to the difficulty of resuming them. The Na- 
 tional Bank, free from all engagements, will be able to regulate its issues of 
 paper, with a view to the danger as vyell as to the demand, that may be found 
 to exist. But, in addition to the privileges granted by the charter, it will also 
 be proper to apprise the State banks, that, after the commencement of the 
 operations of the National Bank, the notes of such banks as do not agree to 
 
ON THE GRANT OF THE CHARTER OF 1816. 
 
 receive, re-issue, and circulate, the notes of that institution, shall not be re- 
 ceived in payments either to the Government or to the National Bank. 
 
 3. The possibility that the national currency of coin may not be perfectly 
 restored, at the time of organizing the bank, has induced the proposition, 
 that the payment of the Government subscription to the capital shall be made 
 in treasury notes, which will be receivable in all payments to the Government, 
 and to the National Bank, but which will not be demandablein coin. The 
 principle of this proposition might perhaps be usefully extended, to authorize 
 the National Bank to issue notes ot a similar character, for a limited period; 
 and it will be proper further to apprise the State banks that the notes of sucn 
 banks as do not agree to_receive, re-issue, and circulate, these treasury notes, 
 or National Bank notes, shall not be received in payments, either to the Go- 
 vernment or to the National Bank. 
 
 I have the honor to be, &c. 
 
 A. J. DALLAS. 
 
 Hon. JOHN C. CALHOUN-, 
 
 Chairman of the Committee on the National Currency. 
 
 OUTLINE OF A PLAN FOR THE NATIONAL BANK, REFERRED TO IN 
 THE PRECEDING LETTER. 
 
 I. The Charier of the Sank. 
 
 1. To continue twenty-one years. 
 
 2. To be exclusive. 
 
 II. The Capital of the Sank. 
 
 1. To be $35,000,000, at present. 
 
 2. To be augmented by Congress to $50,000,000; and the additional sum to 
 be distributed among the several States. 
 
 3. To be divided into 350,000 shares, of 100 dollars each, on the capital of 
 35.000,000; and to be subscribed, 
 
 By the United States, one fifth, or 70,000 shares, - - $7,000,000 
 By corporations and individuals, four fifths, or 280,000 shares, 28,000,000 
 
 $35,000,000 
 
 4. To be compounded of public debt, and of gold and silver, as to the sub- 
 scriptions of corporations and individuals, in the proportions 
 
 )f funded debt, three-fourths, equal to - - $21,000,000 
 
 Of gold and silver, one fourth, equal to - 7,000,000 
 
 28,000,000 
 
 The subscriptions of 6 per cent, stock to be at par. 
 
 The subscriptions of 3 per cent, stock to be at 56 percent. 
 
 The subscriptions of 7 per cent, stock to be at 106.51 per cent. 
 
 5. The subscriptions in public debt may be discharged at pleasure by the 
 Government, at the rate at which it is subscribed. 
 
 6. The subscriptions of corporations or individuals to be payable by instal- 
 ments. 
 
 ( 1 ) Specie, at subscribing, 
 
 On each share, five dollars, $1,400,000 
 
 At six months, five dolllars, - 1,400,000 
 
 At twelve months, five dollars, - - - 1,400,000 
 
 At eighteen months, ten dollars, - - 2,800,000 
 
 $7,000,000 
 
BANK OF THE UNITED STATES. 
 
 (2) Public debt, at subscribing, 
 
 Each share, twenty -five dollars, - 7,000,000 
 
 At six months, twenty five dollars, - - 7,000,000 
 
 At twelve months, twenty-five dollars, - - - 7,000,000 
 
 $28,000,000 
 
 7. The subscriptions of the United States to be paid in instalments, not ex- 
 tending beyond a period of seven years; the first instalment to be paid at the 
 time ot subscribing, and the payments to be made at the pleasure of Govern- 
 ment, either 
 
 In gold and silver; or 
 
 In six percent, stock, redeemable at the pleasure of the Government; or 
 In treasury notes, not fundable, nor bearing interest, nor payable at a par- 
 ticular time, but receivable in all payments to the bank, with a right, on the 
 part of the bank, to re-iss.ue the treasury notes so paid, from time to time, until 
 they are discharged by payments to the Government. 
 
 8. The bank shall be at liberty to sell the stock portion of its capital, to ah 
 
 amount not exceeding in any one year; but, if the sales are intended to 
 
 be effected in the United States, notice thereof shall be given to the Secretary 
 of the Treasury, that the commissioners of the sinking fund may, if they please, 
 become the purchasers, at the market price, not exceeding par. 
 
 III. The Government of the Bank. 
 
 1. The bank shall be established at Philadelphia, with power to erect 
 branches, or to employ State banks as branches elsewhere. 
 
 2. There shall be twenty five directors for the bank at Philadelphia and 
 thirteen directors for each of the branches, where branches are erected, with 
 the usual description and number of officers. 
 
 3. The President of the United States, with the advice and consent of the 
 Senate, shall annually appoint five of the directors of the bank at Philadel- 
 phia. 
 
 4. The qualified stockholders shall annually elect twenty of the directors of 
 the bank at Philadelphia, but a portion of the directors shall be changed at 
 every annual election, upon the principle of rotation. 
 
 5. The directors of the bank at Philadelphia shall, annually, at their first 
 meeting after their election, choose one of the five directors appointed by the 
 President and Senate of the United States to be President of the bank; and 
 the President of the bank shall always be re- eligible if re-appointed. 
 
 6. The directors of the bank at Philadelphia shall annually appoint thirteen 
 directors for each of the branches, where branches are erected, and shall trans- 
 mit a list of the persons appointed to the Secretary of the Treasury. 
 
 7. The Secretary of the Treasury, with the approbation of the President of 
 the United States, shall annually designate, from the list of the branch direc- 
 tors, the person to be the President of the respective branches. 
 
 8. None but resident citizens of the United States shall be directors of the 
 Bank or its branches. 
 
 9. The stockholders may vote for directors in person or by proxy; but no 
 stockholder, who is not resident within the United States at the time of elec- 
 tion, shall vote by proxy; nor shall any one person vote as proxy a greater 
 number of votes than he would be entitled to vote in his own right, according 
 to a scale of voting, to be graduated by the number of shares which the voters, 
 respectively, hold. 
 
 10. The Bank, and its several branches, or the State banks employed as 
 branches, shall furnish the officer at the head of the Treasury Department with 
 statements of their officers, in such form, and at such period, as*&hall be re- 
 quired. 
 
ON THE GRANT OF THE CHARTER OF 1810. 
 
 IV. The Privileges and Duties of the Bank. 
 
 1. The bank shall enjoy the usual privileges, and be subject to the usual 
 resstrictions of a body corporate and politic, instituted for such purposes, and 
 the forgery of its notes shall be made penal. 
 
 2. The notes of the bank shall be receivable in all payments to the United 
 States, unless Congress shall hereafter otherwise provide by law. 
 
 3. The bank and its branches, and State banks employed as branches, shall 
 give the necessary aid and facility to the Treasury tor transfering the public 
 tunds from place to place, and for making payments to the public creditors; 
 without charging commissions, or claiming allowances on account of differences 
 of exchange, &c- 
 
 V. The Organization and Operation of the Bank. 
 
 1. Subscriptions to be opened with as little delay as possible, and at as few 
 places as shall be deemed just and convenient. The commissioners may be 
 named in the act, or appointed by the President. 
 
 2. The Bank to be organized, and commence its operations in specie as soon 
 as the sum of 1,400,000 dollars has been actually received from the subscribers, 
 in gold and silver. 
 
 3. The Bank shall not at any time suspend its specie payments, unless the 
 same shall be previously authorized by Congress, if in session, or by the 
 President of the United States, if Congress be not in session. In the latter 
 case, the suspension shall continue for six weeks after the meeting of Con- 
 gress, and no longer, unless authorized by law. 
 
 VI. The Bonus for the Charter of the Bank. 
 
 The subscribers shall pay a premium to the Government for its charter. 
 Estimating the profits of the bank from the probable advance in the value of its 
 stock, and the result of its business when in full operation, at seven per cent, 
 a bonus of 1,500,000 dollars, payable in equal instalments of two, three, and 
 tour years after the bank commences its operations, might, under all circum- 
 stances, be considered as about four per cent, upon its capital, and would con- 
 tribute a reasonable premium. 
 
 JANUARY 8, 1816. 
 
 Mr. CALHOUX, from the committee on that part of the President's message 
 which relates to an uniform national currency, reported a bill *' to incorpo- 
 rate the subscribers to the Bank of the United Slates;-' which was read the 
 first and second time, and committed to a committee of the whole house. 
 
 The said bill is as follows: 
 
 A Bill to incorporate the Subscribers to the Bank of the United States. 
 
 Be it enacted by the Senate and House of Representatives of the United 
 States of America in Congress assembled. That a Bank of the United States 
 of America shall be established, with a capital of thirty-five millions of dollars, 
 divided into three hundred and fifty thousand shares, of one hundred dollars 
 each share; but, Congress may, at any time hereafter, augment the capital of 
 the said bank, to a sum not exceeding fifty millions of dollars, in such manner 
 as shall be by law provided. Seventy thousand shares, amounting to the sum 
 of seven millions of dollars, part of the capital of the said bank, shall be sub- 
 scribed, and paid for by the United States, in the manner hereinafter speci- 
 fied; and two hundred and eighty thousand shares, amounting to the sum of 
 twenty-eight millions of dollars, shall be subscribed and paid for. by indi- 
 viduals, companies, or corporations, in the manner hereinafter specified. 
 
 SEC. 2. And be it further enacted, That subscriptions for the sum of twen- 
 ty eight millions of dollars, towards constituting the capital of the said bank, 
 
22 BANK OF THE UNITED STATES. 
 
 shall be opened on the first Monday in June next, at the following places, 
 that is to say: at Portsmouth, in the State of New Hampshire; at Boston, in 
 the State of Massachusetts; at Providence, in the State of Rhode Island; at 
 New Haven, in the State of Connecticut; at Burlington, in the State of Ver- 
 mont; at New York, in the State of New York; at , in the State 
 
 of New Jersey^ at Philadelphia, in the State of Pennsylvania; at Wilmington, 
 in the State ot Delaware; at Baltimore, in the State of Maryland; at Rich- 
 mond, in the State of Virginia; at Lexington, in the State of Kentucky; at 
 
 ,in the State of Ohio; at Raleigh, in the State of North .Carolina; 
 
 at Nashville, in the State of Tennessee; at Charleston, in the State of South 
 Carolina; at Augusta, in the State of Georgia; at New Orleans, in the State 
 of Louisiana; and at Washington, in the District of Columbia. And the said 
 subscriptions shall be opened under the superintendence of three commission- 
 ers, to be appointed at, and for, each of the said places, by the President of 
 the United States, (who is hereby authorized to make such appointments) and 
 shall continue open every day, from the time of opening the same, between 
 the hours of ten o'clock in the forenoon, and four o'clock in the afternoon, 
 until the Saturday following, at four o'clock in the afternoon, when the same 
 shall be closed; and immediately thereafter, the commissioners, or any two of 
 them, at the respective places aforesaid, shall cause two transcripts or copies 
 of such subscriptions to be made, one of which they shall send to the Secretary 
 of the Treasury, one they shall retain, and the original they shall transmit, 
 within seven d?; r s from the closing of the subscriptions as aforesaid, to the 
 commissioners at Philadelphia aforesaid. And on the receipt of the said ori- 
 ginal subscriptions, or of either of the said copies thereof, if the original be lost, 
 mislaid, or detained, the commissioners at Philadelphia aforesaid, or a majo- 
 rity of them, shall immediately thereafter convene, and proceed to take an ac- 
 count of the said subscriptions. And if more than the amount of twenty-eight 
 millions of dollars shall have been subscribed, then the said last mentioned 
 commissioners shall apportion the same among the several subscribers, accord- 
 ing to their several respective subscriptions, allowing and apportioning to 
 each subscriber, at least one share. And in case the aggregate amount of the 
 said subscriptions shall exceed twenty-eight millions ot dollars, the said last 
 mentioned commissioners, after having apportioned the same as aforesaid, 
 shall cause lists of the said apportioned subscriptions to be made out, including 
 in each list the apportioned subscription for the place where the original sub- 
 scription was made, one of which lists they shall transmit to the commission- 
 ers, or one of them, under whose superintendence such subscriptions were 
 originally made, that the subscribers may thereby ascertain the number of 
 shares to them respectively apportioned as aforesaid. And in case the aggre- 
 gate amount of the said subscriptions made, during the period aforesaid, at all 
 the places aforesaid, shall not amount to twenty-eight millions of dollars, the 
 subscriptions to complete the said sum shall be and remain open at Philadel- 
 phia aforesaid, under the superintendence of the commissioners appointed for 
 that place; and the subscriptions may be then made by any individual, compa- 
 ny, or corporation, for any number of shares, not exceeding in the whole the 
 amount required to complete the said sum of twenty-eight millions of dollars. 
 SEC. 3. And be it further enacted, That it shall be lawful for any indi- 
 vidual, company, or corporation, when the subscriptions shall be" opened, as 
 hereinbefore directed, to subscribe for any number <of shares of the capital of 
 the said bank, not exceeding three thousand shares|and the sums so subscrib- 
 ed shall be payable, andfpaid in the manner following, that is to say: seven 
 millions of dollars thereof in gold or silver coin, of the United States, or in fo- 
 reign gold or silver coin, at the value thereof, as heretofore established by an 
 act, entitled " An act regulating the currency of foreign coins," passed the 
 tenth day of April, in the year one thousand eighthundred and six; and twen- 
 ty-one millions of dollars thereof in like gold or silver coin, or in the funded 
 debt of the United States, contracted at the time of the subscriptions respect- 
 ively. And the payments made in the funded debt of the United States shall 
 ,be paid and received at the following rates, that is to say : the funded debt, 
 
ON THE GRANT OF THE CHARTER OF 1816. 
 
 bearing an interest of six per centum per annum, at the nominal or par value 
 thereof; the funded debt bearing an interest of three per centum per annum, at 
 the rate of sixty-five dollars for every sum of one hundred dollars ot the no- 
 minal amount thereof; and the funded debt, bearing an interest of seven per 
 centum per annum, at the rate of one hundred and six dollars and fifty-one 
 cents, fur every sum of one hundred dollars of the nominal amount thereof; 
 together with the amount of the interest accrued on the said several denomina- 
 tions of funded debt, to be computed and allowed to the time of subscribing 
 the same to the capital of the said bank as aforesaid. And the payments of 
 the said subscriptions shall be made and completed by the subscribers, re- 
 spectively, at the times and in the manner following, that is to say: at the 
 tune of subscribing, there shall be paid five dollars on each share, in gold or 
 silver coin as aforesaid, and twenty-five dollars more, in coin as aforesaid, or 
 in funded debt as aforesaid; at the expiration of six calendar months after the 
 time of subscribing, there shall be paid the further sum of five dollars on each 
 share, in gold or silver coin as aforesaid, and twenty-five dollars more, in coin 
 as aforesaid, or in funded debt as aforesaid; at the expiration of twelve calen- 
 dar months from the time of subscribing, there shall be paid the further sum 
 of five dollars on each share, in gold or silver coin as aforesaid, and twenty- 
 five dollars more, in coin as aforesaid, or in funded debt as aforesaid; and at 
 the expiration of eighteen calendar months, there shall be paid the further 
 sum ot ten dollars in gold or silver coin as aforesaid. 
 
 SEC. 4. find be it further enacted, That, at the time of subscribing to the 
 capital of the said bank as aforesaid, each and every subscriber shalldeliver 
 to the commissioners, at the place of subscribing, as well the amount of their 
 subscriptions, respectively, in coin as aforesaid, as the certificates of funded 
 debt, for the funded debt proportion of their respective subscriptions, together 
 with a power of attorney, authorizing the said commissioners, or a majority 
 of them, to transfer the said stock in due form of law, to ' 4 the president, di- 
 rectors and company, of the Bank of the United States of America," as soon 
 as the said bank shall be organized. Provided, always, That if, in conse- 
 quence of the apportionment ot the shares in the capital of the said bank among 
 the subscribers, in the case, and in the manner hereinbefore provided, any 
 subscriber shall have delivered to the commissioners, at the time of subscribing, 
 a greater amount of gold or silver coin and funded debt, than shall be neces- 
 sary to complete the payments for the share or shares to such subscribers, ap- 
 portioned as aforesaid, the commissioners shall only retain so much of the said 
 gold or silver coin, and funded debt, as shall be necessary to complete such 
 payments, and shall forthwith return the surplus thereof, on application for 
 the same, to the subscribers lawfully entitled thereto. And the commission- 
 ers, respectively, shall deposite the gold and silver coin, and certificates of 
 public debt, by them respectively received as aforesaid, from the subscribers 
 to the capital of the said bank, in some place of secure and safe keeping, so 
 that the same may, and shall be specifically delivered and transferred, as the 
 same were by them respectively received, to the president, directors, and 
 company of the Bank ot the United States of America, or to their order, as 
 soon as shall be required after the organization of the said bank. And the said 
 commissioners appointed to superintend the subscriptions to the capital of the 
 said bank as aforesaid, shall receive a reasonable compensation for their ser- 
 vices, respectively, and shall be allowed all reasonable charges and expenses 
 incurred in the execution of their trust, to be paid by the president, directors, 
 and company, of the bank, out of the funds thereof. 
 
 SEC. 5. And be it further enacted, That it shall be lawful for the United 
 States to pay, and redeem the funded debt subscribed to the capital of the said 
 bank, at the rates aforesaid, in such sums, and at such times as shall be deemed 
 expedient, any thing in any act or acts of Congress to the contrary thereof 
 notwithstanding. And it shall also be lawful for the president, directors, and 
 company, of the said bank, to sell and transfer, for gold and silver coin or bul- 
 lion, the funded debt subscribed to the capital of the said bank as aforesaid- 
 Provided, always* That they shall not sell more thereof than the sum of two 
 
624 BANK F THE UNITED STATES. 
 
 millions of dollars in any one year; nor sell any part thereof, at any time, within 
 the United States, without previously giving notice of their intention, to the 
 Secretary of the Treasury, and offering the same to the United States at the 
 current price, not exceeding the rates aforesaid. 
 
 SEC. 6. And be it further enacted, That, at the opening"of the subscription 
 to the capital stock of the said bank, the Secretary of the Treasury shall sub 
 scribe, or cause to be subscribed, on behalf of the United States, the said 
 number of seven thousand shares, amounting to seven millions of dollars, as 
 aforesaid, to be paid in gold or silver coin, or treasury notes, or in stock of 
 the United States, bearing interest at the rate of six per centum per annum, 
 in seven equal annual payments of one million of dollars each, the first whereof 
 shall be made at, or as nearly as conveniently may be after, the opening of the 
 said subscriptions: Provided, always, Thai it shall be lawful for the Secretary 
 of the Treasury, with the approbation of the President of the United States, 
 and the consent of the president, directors, and company of the said bank, to 
 anticipate and pay in advance, all or any of the said annual payments, at such 
 times, and in such manner, as shall be mutually stipulated and agreed. 
 
 SEC. 7. And be it further enacted, That the Secretary of the Treasury, 
 \yith the approbation of the President of the United States, shall, from time to 
 time, select and designate the mode of paying for the said subscription of the 
 United States, to the capital of the said bank as aforesaid. And if payment 
 thereof, or of any part thereof, be made in public stock, bearing interest at the 
 rate of six per centum per annum, as aforesaid, the said interest shall be pay- 
 able quarterly, to commence from the time of making such payment on ac- 
 count of the said subscriptions, and the principal of the said stock shall be 
 redeemable in any sums, and at any periods which the Government shall deem 
 fit. And the Secretary of the Treasury shall, from time to time, cause the 
 certificates of such public stock to be prepared, and made in the usual form, 
 and shall pay and deliver the same to the president, directors, and company, 
 of the said bank, at, or as soon as conveniently may be after, the time and 
 times, hereinbefore prescribed for the payment of the said subscription of the 
 United States, to the capital of the said bank as aforesaid; or at such other 
 time and times as may be agreed upon in pursuance of the authority herein- 
 before given, to anticipate the payments of the said subscription as aforesaid, 
 And if payment of the said subscription of the United States to the capital 
 of the saia bank as aforesaid, or of any part thereof, shall be made in treasury 
 notes, such treasury notes shall not bear interest, but shall pass by endorse- 
 ment, or by delivery, for such sum, to be specified on the face thereof, respect- 
 ively, as the Secretary of the Treasury, with the approbation of the President 
 of the United States, shall direct; and shall be receivable in all payments to 
 the United States, and in all payments to the president, directors, and com- 
 pany, of the said bank. And the Secretary of\the Treasury shall, from time 
 to time, cause the said treasury notes to be prepared, and shall pay and deli- 
 ver the same to the president, directors, and company, of the said Dank, at, or 
 as soon as conveniently may be after, the time and times hereinbefore pre- 
 scribed, for the payment of the said subscription of the United States, to the 
 capital of the said bank as aforesaid; or at such other time and times as may 
 be agreed upon, in pursuance of the authority hereinbefore given, to anticipate 
 the payments of the said subscription as aforesaid. And it shall be lawful 
 for the Secretary of the Treasury, or for the president, directors, and com- 
 pany, of the said bank, to issue, and re -issue, at their par value, such of the said 
 treasury notes as shall be received in payments by the United States, or by 
 the. said bank, respectively, as aforesaicl: Provided, always, That the United 
 States may at any time redeem arid cancel the said treasury notes, or any 
 part thereof, while the same shall be in the possession of the said bank as the 
 property thereof: And provided, aho, That it shall be the duty of the Secre- 
 tary of the Treasury, out of the said treasury notes received in payments to 
 the United States, as aforesaid, to cause a portion thereof to be cancelled 
 yearly, and every year, so that the whole amount issued may be redeemed 
 
ON THE GRANT OF THE CHARTER OF 1816. 
 
 and cancelled on or before the expiration of eight years from the time of open- 
 ing the subscription to the capital of the said bank as aforesaid. 
 
 SEC. 8. And be, it further enacted, That, if any person shall falsely make, 
 forge, or counterfeit, or cause or procure to be falsely made, forged, or coun- 
 terfeited, or willingly aid or assist in falsely making, forging, or counterfeit- 
 ing, any note in imitation of, or purporting to be a treasury note as aforesaid; 
 or shall falsely alter, or cause or procure to be falsely altered, or willingly 
 aid or assist in falsely altering, any treasury note issued as aforesaid; or shall 
 pass, utter, or publish as true, any false, forged, or counterfeit note, purporting 
 to be a treasury note as aforesaid, knowing the same to be falsely made, forged, 
 or counterfeited; or shall pas<=, utter, or publish, or attempt to pass, utter, or 
 publish as true, any falsely altered treasury note issued as aforesaid, know- 
 ing the same to be falsely altered; or shall be, directly or indirectly, knowing- 
 ly concerned in any of the offences aforesaid, every such person shall be 
 deemed and adjudged guilty of felony; and being thereof convicted by due 
 course of law, shall be sentenced to be imprisoned, and kept to hard labor, 
 for a period not less than three years, nor more than ten years, and be fined 
 in a sum not exceeding five thousand dollars. 
 
 SEC. 9. Jind be it further enacted* That the subscribers to the said Bank of 
 the United States of America, their successors and assigns, shall be, and are 
 hereby, created a corporation and body politic, by the name and style of 
 44 The^President, Directors, and Company, of the Bank of the United States," 
 and shall so continue until the third day of March, in the year one thousand 
 eight hundred and thirty-six, and by that name shall be, and are hereby, made 
 able and capable, in law, to have, purchase, receive, possess, enjoy, and re- 
 tain, to them and their successors, lands, rents, tenements, hereditaments, 
 goods, chattels, and effects, of whatsoever kind, nature, and quality, to an 
 amount not exceeding, in the whole, fifty-live millions of dollars, including 
 the amount of the capital stock aforesaid; and the same to sell, grant, demise, 
 alien, or dispose of; to sue and be sued, plead and be impleaded, answer and 
 be answered, defend and be defended, in all courts and places whatsoever; 
 and also to make, have, and use a common seal, and the same to break, alter, 
 and renew, at their pleasure; and also to ordain, establish, and put in execu- 
 tion, such by-lavys, arid ordinances, and regulations, as they shall deem neces- 
 sary and convenient for the government ot the said corporation, not being con- 
 trary to the constitution and laws of the United States: and generally to do 
 and execute all and singular the acts, matters, and things, Which to them it 
 shall or may appertain to do; subject, nevertheless, to the rules, regulations, 
 restrictions, limitations, and provisions, hereinafter prescribed and declared. 
 
 SEC. 10. Jind be it further enacted, That, for the management of the affairs 
 of the said corporation, there shall be twenty-five directors, five of whom 
 shall be annually appointed by the President of the United States, by and 
 with the advice and consent of the Senate, and twenty of whom shall be an- 
 nually elected at the banking house in the city of Philadelphia, on the first 
 Monday of January, in each year, by the qualified stockholders of the capital 
 of the said bank, and by a plurality of votes then and there actually given, 
 according to the scale of voting hereinafter prescribed. And the directors, so 
 duly appointed and elected, shall be capable of serving, by virtue of such ap- 
 pointment and choice, from the first Monday in the month of January, of each 
 year, until the end and expiration of the first Monday in the month of January 
 of the year next ensuing the time of each annual election to be held by the 
 stockholders as aforesaid. And the board of directors, annually, at the first 
 meeting after their election in each and every year, shall proceed to elect one 
 of the five directors appointed by the President of the United States, to be 
 president of the corporation, who shall hold the said office during the same 
 period for which the directors are appointed and elected as aforesaid: Pro- 
 vided, always, That the first appointment and election of the directors and pre - 
 sident of the said bank shall be at the time and for the period hereinafter de- 
 clared: Jind provided, aho. That, in case it should at any time happen that an 
 appointment or election ot directors, or an election of the president of the 
 79 
 
626 BANK OF THR UNITED STATES. 
 
 said bank, should not be so made as to take effect on any day when, in pur- 
 suance of this act, they ought to take effect, the said corporation shall not, for 
 that cause, be deemed to be dissolved: but it shall be lawful, at any other 
 time, to make such appointments, and to hold such elections; (as the case 
 may be) and the manner of holding the elections shall be regulated by the by- 
 laws and ordinances of the said corporation; and until such appointments or 
 elections be made, the directors and president of the said bank, for the time 
 being, shall continue in office: And provided, also, That, in case of the death, 
 resignation, or removal, of the president of the said corporation, the directors 
 shall proceed to elect another president from the directors appointed by the 
 President of the United States as aforesaid; and incase of the death, resigna- 
 tion, or absence from the United States, or removal, of a director from office, 
 the vacancy shall be supplied by the President of the United States, or by the 
 stockholders, as the case may be. But the President of the United States 
 alone shall have power to remove the president of the bank, or any of the di- 
 rectors appointed by him as aforesaid. 
 
 SEC. 11. find be it further enacted, , That, as soon as the sum of eight mil- 
 lions four hundred thousand dollars, in gold and silver coin, and in the pub- 
 lic debt, shall have been actually received on account of the subscriptions to 
 the capital of the said bank, (exclusively of the subscription aforesaid, on the 
 part ot the United States) notice thereof shall be given by the persons under 
 whose superintendence the subscriptions shall have been made at the city of 
 Philadelphia, in at least two newspapers printed in each of the places, (if so 
 many be printed at such places respectively) where subscriptions shall have 
 been made, and the said persons shall, at the same time, and in like mariner, 
 notify a time and place within the said city of Philadelphia, at the distance of 
 at least thirty days from the time of such notification, for proceeding to the 
 election of twenty directors as aforesaid, and it shall be lawful for such elec- 
 tion to be then and there made. And the President of the United States is 
 hereby authorized, during the present session of Congress, to nominate, and, 
 by and with the advice and consent of the Senate, to appoint, five directors of 
 the said bank; and the persons who shall be elected and appointed as afore- 
 said, shall be the first directors of the said bank, and shall proceed to elect 
 one of the five directors appointed by the President of the United States as 
 aforesaid, to be president of the said bank; and the directors and president 
 of the said bank, so appointed and elected as aforesaid, shall be capable of 
 serving in their respective office, by virtue thereof, until the end and expira- 
 tion of the first Monday of the month of January next ensuing the said ap- 
 pointments and elections; and they shall then and thenceforth commence and 
 continue the operations of the said bank, at the city of Philadelphia. 
 
 SEC. 12. And be it further enacted, That the directors for the time being 
 shall have power to appoint such officers, clerks, and servants under them, as 
 shall be necessary for executing the business of the said corporation, and to 
 allow them such compensation for their services, respectively, as shall be rea- 
 sonable; and shall be capable of exercising such other powers and authorities, 
 for the well governing and ordering of the officers of the said corporation, as 
 shall be prescribed, fixed, and determined, by the laws, regulations, and ordi- 
 nances, of the same. 
 
 SEC. 13. Jind be it further enacted, That the following rules, restrictions, 
 limitations, and provisions, shall form and be fundamental articles of the con- 
 stitution of the said corporation, to wit: 
 
 1. The number of votes to which the stockholders shall be entitled, in vot- 
 ing for directors, shall be according to the number of shares he, she, or they, 
 respectively, shall hold, in the proportions following, that is to say: for one 
 share, and not more than two shares, one votej for every two shares above 
 two, and not exceeding ten, one vote; for every lour shares above ten, and not 
 exceeding thirty, one vote; for every six shares above thirty, and not exceed- 
 ing sixty, one vote; for every eight shares above sixty, and not exceeding one 
 hundred, one vote; and for every ten shares above one hundred, one vote; 
 but no person, co-partner?hip, or body politic, hall be entitled to a greater 
 
ON THE GRANT OF THE CHARTER OF 1810. 597 
 
 number than thirty votes; and alter the first election, no share or .shares ?%hall 
 confer a right of voting, which shall not have been holiicn three calendar 
 months previous to the (lay of election. And stockholders actually resident 
 within the United States, and none other, may vote in elections by proxy. 
 But no person shall give, in the whole, a greater number of votes, as proxy, 
 and in his own right, than he would be entitled to give in his own right only, 
 according to the proportion of voting hereinafter prescribed. 
 
 2. Not more than three-fourths of the directors elected by the stockhold- 
 ers, and not more than four-fifths of the directors appointed by the President 
 of the United States, who shall be in office at the time of an annual election, 
 shall be elected or appointed for the next succeeding year; but the director 
 who shall be the president at the time of an election may always be re-appoint- 
 ed by the President of the United States, and be re-elected president of the 
 bank by the directors thereof. 
 
 3. None but a resident citizen of the United States shall be a director; nor 
 shall a director be entitled to any emolument; but the stockholders may make 
 such compensation to the president, for his extraordinary attendance at the 
 bank, as shall appear to them reasonable. 
 
 1. Not less than seven directors shall constitute a board for the transaction 
 of business, of whom the president shall always be one, except in case of sick- 
 ness or necessary absence; in which ca*e his place may be supplied by any 
 other director whom he, by writing, under his hand, shall depute for that 
 purpose. And the director so deputed may do and transact all the ner 
 rv business belonging to the office of the. president <>f the said corporation, 
 (luring the continuance of the sickness or necessary absence of the president. 
 
 o. A number of stockholders, not less than sixty? who, together, shall he 
 proprietors of one thousand shares or upwards, *\]'A\\ have power at any time 
 to call a general meeting of the stockholders, for purposes relative to the in- 
 stitution, giving at least ten weeks' notice in two public newspapers of the 
 place where the bank is seated, and specifying in such notice the objector 
 objects of such meeting. 
 
 6. Each cashier or treasurer, before he enters upon the duties of his office, 
 shall be required to give bond, with two or more sureties, to the. satisfaction of 
 the directors, in a sum not less than fifty thousand dollars, with a condition 
 for his good behavior, and the faithful performance of his duties to the cor- 
 poration. 
 
 7. The lands, tenements, and hereditaments, which it shall be lawful for 
 the said corporation to hold, shall be only such as shall be requisite lor its 
 immediate accommodation in relation to the convenient transacting of its bu- 
 siness, and such as shall have been bona Jlde mortgaged to it by way of secu 
 rity, or conveyed to it in satisfaction of debts previously contracted in the 
 course of its dealings, or purchased at sales, upon judgments which shall 
 have been obtained for such debts. 
 
 8. The total amount of debts which the said corporation shall at any time 
 owe, whether by bond, bill, note, or other contract, over and above the debt 
 or debts due for money deposited in the bank, shall not exceed the sum of 
 fifty millions of dollars, unless the contracting of any greater debt shall have 
 been previously authorized by a law of the United States. In case of excess, 
 the directors under whose administration it shall happen, shall be liable for 
 the same in their natural and private capacities; and an action of debt may 
 in such case be brought against them, or any of them, their or any of their 
 heirs, executors, or administrators, in any court of record of the United States, 
 or either of them, by any creditor or creditors of the said corporation, and 
 may be prosecuted to judgment and execution, any condition, covenant, or 
 agreement, to the contrary notwithstanding. But this provision shall not be 
 construed to exempt the said corporation, or the lands, tenements, goods, or 
 chattels of the same, from being also liable for, and chargeable with, the said 
 excess. 
 
 Such of the said directors, who may have been absent M hen the said ex- 
 cess was contracted or created, or who may have dissented from the resolu- 
 
628 BANK OF THE UNITED STATES. 
 
 tion or act whereby the same was so contracted or created, may respectively 
 exonerate themselves from being so liable, by forthwith giving notice of the 
 fact, and of their absence or dissent, to the President of "the United States, 
 and to the stockholders, at a general meeting, which they shall have power to 
 call for that purpose. 
 
 9. The said corporation shall not, directly or indirectly, deal or trade in 
 any thing except bills of exchange, gold or silver bullion, or in the sale of goods 
 really arid truly pledged for money lent and not redeemed in due time, or 
 goods which shall be the proceeds of its lands. It shall not be at liberty to 
 purchase any public debt whatsoever; nor shall it take more than at the rate 
 of six per centum per annum for or upon its loans or discounts. 
 
 10. No loan shall be made by the said corporation, for the use or on account 
 of the Government of the United States, to an amount exceeding five hundred 
 thousand dollars, or of any particular State to an amount exceeding fifty thou- 
 sand dollars, or of any foreign prince or State, unless previously authori/,ed 
 by a law of the United States. 
 
 11. The stock of the said corporation shall be assignable and transferable 
 according to such rules as shall be instituted in that behalf, by the laws and 
 ordinances of the same. 
 
 12. The bills obligatory and of credit, under the seal of the said corpora- 
 tion, which shall be made to any person or persons, shall be assignable by en- 
 dorsement thereupon, under the hand or hands of such person or persons, and 
 his, her, or their executors or administrators, and of his or their assignee or 
 assignees, and so as absolutely to transfer and vest the property thereof in 
 each and every assignee or assignees successively, and to enable such assignee 
 or assignees, and his, her, or their executors or administrators, to maintain an 
 action thereupon in his, her, or their own name or names. And the bills or notes 
 which may be issued by order of the said corporation, signed by the president, 
 and countersigned by the principal cashier or treasurer thereof, promising the 
 payment of money to any person or persons, his, her, or their order ? or to 
 bearer, although not under the seal of the said corporation, shall be binding 
 and obligatory upon the same, in like manner, and with like force and effect, 
 as upon any private person or persons, if issued by him, her, or them, in his, 
 her, or their private or natural capacity or capacities, and shall be assignable 
 and negotiable in like manner as if they were so issued by such private per- 
 son or persons, that is to say: those which shall be payable to any person or 
 persons, his, her, or their order, shall be assignable by endorsement, in like 
 manner, and with the like effect as foreign bills of exchange now are; and 
 those which are payable to bearer shall be assignable and negotiable by de- 
 livery only. 
 
 13. Half yearly dividends shall be made of so much of the profits of the 
 bank as shall appear to the directors advisable; and once in every three 
 years the directors shall lay before the stockholders, at a general meeting, for 
 their information, an exact and particular statement of the debts which shall 
 have remained unpaid, alter the expiration of the original credit, for a period 
 of treble the term of that credit, and of the surplus ofthe profits, if any, after 
 deducting losses and dividends. If there shall be a failure in the payment of 
 any part of any sum subscribed to the capital of the said bank, by any person, 
 copartnership, or body politic, the party failing shall lose the benefit of any 
 dividend which may have accrued prior to the time for making such payment, 
 and during the delay of the same. 
 
 14. The directors of the said corporation shall establish a competent office 
 of discount and deposite in the District of Columbia, whenever any law of the 
 United States shall require such an establishment; and it shall be lawful for 
 the directors of the said corporation to establish offices wheresoever they shall 
 think fit, within the United States or the territories thereof, and to commit 
 the management of the said offices, and the business thereof, respectively, to 
 such persons, and under such regulations, as they shall deem proper, not 
 being contrary to law or the constitution of the bank. Or, instead of esta- 
 blishing such offices, it shall be lawful for the directors of the said corpora- 
 
ON THE GRANT OF THE CHARTER OF 1816. 
 
 lion, from time to time to employ any other bank or banks, to be fit>t approv- 
 ed by the Secretary of the Treasury, at any place or places that they may 
 deem safe and proper, to manage and transact the business proposed, as afore- 
 said, to be managed and transacted by such offices, under such agreements; 
 and subject to such regulations as they shall deem just and proper. Thirteen 
 managers or directors, of every office established as aforesaid, shall be annu- 
 ally appointed by the directors of the bank, to serve one year; they shall 
 choose a president from their own number; each of them shall be a citizen of 
 the United States; and not more than three fourths of the said managers or 
 directors, in office at the time of an annual appointment, shall be re-appoint- 
 ed for the next succeeding year: but the president may be always re-appointed. 
 15. The officer at the head of the Treasury Department of the United 
 States shall be furnished, from time to time, as often as lie may require, not 
 exceeding once a week, with statements of the amount of the capital stock of 
 the said corporation, and of the debts due to the same; of the moneys depo- 
 sited therein; of the notes in circulation; and of the specie in hand; and 
 shall have a right to inspect such general accounts in the books of the bank as 
 shall relate to the said statement: Provided* That this shall not be construed 
 to imply a right of inspecting the account of any private individual or indi- 
 viduals with the bank. 
 
 SEC. 14. And be it further enacted. That, if the said corporation, or any 
 person or persons, for, or to the use of the same, shall (leal, or trade, in buy- 
 ing or selling goods, wares, merchandise, or commodities, whatsoever, con- 
 trary to the provisions of this act, all and every person and persons, by whom 
 anv order or direction for so dealing or trading, shall have been given; and 
 all and every person and persons who shall have been concerned as parties or 
 agents therein, shall forfeit and lose treble the value of the goods, wares, 
 merchandises, and commodities, in which such dealing and trade snail have 
 been, one half thereof to the use of the informer, and the other half thereof 
 to the use of the United States, to be recovered in any action of law, with 
 costs of suit. 
 
 SEC. 15. And be if further enacted, That, if the said corporation shall ad- 
 vance, or lend any sum of money, for the use, or on account of the Govern- 
 ment of the United States, to an amount exceeding five hundred thousand 
 dollars; or of any particular State, to an amount exceeding fifty thousand dol- 
 lars; or of any foreign prince or State, (unless previously authorized thereto by 
 a law of the United States) all and every person and persons, by and with 
 whose order, agreement, consent, approbation, and connivance, such unlawful 
 advance or loan shall have been made, upon conviction thereof, shall forfeit 
 and pay, for every such offence, treble the value or amount of the sum or sums 
 which have been so unlawfully advanced orient, one fifth thereof to the use 
 of the informer, and the residue thereof to the use of the United States. 
 
 SEC. 16. And be it further enacted, That the bills or notes of the said cor- 
 poration, originally made payable, or which shall have become payable, on de- 
 mand, shall be receivable in all payments to the United States, unless other- 
 wise directed by act of Congress. 
 
 SEC. 17. And be it further enacted. That, during the continuance of this 
 act, and whenever required by the Secretary of the Treasury, the said cor- 
 poration shall give the necessary facilities for transferring the public funds 
 from place to place, and for distributing the same in payment of the public 
 creditors, without charging commissions, or claiming allowance, on account of 
 difference of exchange, and shall, also, do and perform the several and re- 
 spective duties of the commissioners of loans for the several States, or of any 
 one or more of them, at the times, in the manner, and upon the terms, prescrib- 
 ed by the Secretary of the Treasury. 
 
 SEC. 18. And be it further enacted, That the said corporation shall not, at 
 any time, suspend, or refuse to pay, the notes thereof, in gold or silver coin, 
 upon demand, according to the contract and promise of such notes: Provid- 
 ed always, nevertheless, That, upon the representation of the said corpora- 
 tion, Congress shall have power to authorize the suspension or refusal afore- 
 
(J30 BANK OF THE UNITED STATES. 
 
 s-tid, tor a time to be limited by law; and that, during the recess of Congress, 
 it shall be lawful for the President of the United States, upon a like represen- 
 tation, to authorize such suspension for a term which shall not exceed six 
 weeks after the opening of the next ensuing session of Congress. 
 
 SEC. 19. find be it further enacted. That, in consideration of the exclusive 
 privileges and benefits conferred by this act, upon the said bank, the Presi- 
 dent, Directors, and Company thereof, shall pay to the United States, out of 
 the corporate funds thereof, the sum of one million and five hundred thou- 
 sand dollars, in three equal payments, that is to say: five hundred thousand 
 dollars at the expiration of two years, five hundred thousand dollars at the 
 expiration of three years, and five hundred thousand dollars at the expiration 
 of four years, after the said bank shall be organized and commence its ope- 
 rations, in the manner hereinbefore provided. 
 
 SEC. 20. Jlnd be it. further enacted, That no other bank shall be established 
 by any future law of the United States, during the continuance of the corpo- 
 ration hereby created, for which the faith of the United States is hereby 
 pledged: Provided, Congress may renew existing charters for banks in the 
 District of Columbia, not increasing the capital thereof; and may grant char- 
 ters, if they deem it expedient, to any banking associations now in operation 
 in the said district, and renew the same, not increasing the capital thereof. 
 And, notwithstanding the expiration of the term for which the said corpora- 
 tion is created, it shall be lawful to use the corporate name, style ? and ca- 
 pacity, 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, nor for a period exceeding two years after the 
 expiration of the said term of incorporation. 
 
 FEBRUARY 26, 1816. 
 
 On motion of Mr. CALHOUN, the House postponed the intervening orders 
 of the day, to proceed to the consideration ot the National Bank bill. 
 
 The House having resolved itself into a committee of the whole, Mr. Nel- 
 son, of Va. in the chair, on that subject; the bill having been read, establishing 
 a national bank, with a capital of thirty-five millions of dollars- 
 Mr. CALHOUN rose to explain his views of a subject so interesting to the 
 republic, and so necessary to be correctly understood, as that of the bill now 
 before the committee. He proposed at this time only to discuss general prin- 
 ciples, without reference to details. He was aware, he said, that principle 
 and detail might be united; but he should at present keep them distinct. He 
 did not propose to comprehend, in this discussion, the power of Congress to 
 grant bank charters; nor the question whether the general tendency of banks 
 was favorable or unfavorable to the liberty and prosperity of the country; nor 
 the question whether a national bank would be favorable to the operations of 
 the Government. To discuss these questions, he conceived, would be an use- 
 less consumption of time. The constitutional question had been already so 
 freely and frequently discussed, that all had made up their mind on it. The 
 question whether banks were favorable to public liberty and prosperity, was 
 one purely speculative. The fact of the existence of banks, and their incor- 
 poration with the commercial concerns and industry of the nation, proved that 
 inquiry to come too late. The only question was, on this hand, under what mo- 
 difications were banks most useful, and whether the United States ought or 
 ought not to exercise the power to establish a bank. As to the question whe- 
 ther a national bank would be favorable to the administratioa of the finances 
 of the Government, it was one on which there was so little doubt, that gentle- 
 men would excuse him it he did not enter into it. Leaving all these questions, 
 then, Mr. C. said, he proposed to examine the cause and state of the disorders 
 of the national currency, and the question whether it was in the power of Con- 
 gress, by establishing a national bank, to remove those disorders. This, he 
 
ON THE GRANT OF THT. CHARTFR OF 1816. 
 
 observed, was a question of novelty and vital importance; a question which 
 greatly affected the character and prosperity of the country. 
 
 As to the state of the currency of the nation, Mr. C. proceeded to remark 
 that it was extremely depreciated, and in degrees, varying according to the 
 different sections ot the country, all would assent. That this state of the 
 currency was a stain on the public and private credit, and injurious to the 
 morals of the community, was so clear a position as to require no proof. There 
 were, however, other considerations arising from the state of the currency, not 
 so distinctly felt, not so generally assented to. The state of our circulating 
 medium was, he said, opposed to the principles of the federal constitution. 
 The power was given to Congress by that instrument, in express terms, to regu- 
 late the currency of the United States. In point of fact, ne said, that power, 
 though given to Congress, is not in their hands. The power is excercised by 
 banking institutions, no longer responsible for the correctness with which they 
 manage it. Gold and silver have disappeared entirely; there is no money but 
 paper money, and that money U beyond the control of Congress. No one, he 
 said, who referred to the constitution, could doubt that the money of the Unit- 
 ed States was intended to be placed entirely under the control of Congress. 
 The only object the trainers ot the constitution could have in view, in giving 
 to Congress the power" to coin money, regulate the value thereof, and of for- 
 eign coin," must have been, to give a steadiness and fixed value to the cur- 
 rency of the United States. The state of tilings at the time of the adoption 
 of the constitution, afforded Mr.C. an argument in support of his construction. 
 There then existed, he said, a depreciated paper currency, which could only 
 be regulated and made uniform by giving a power, for that purpose, to the 
 General Government, The States could not do it. He argued, therefore, tak- 
 ing into view the prohibition against the States issuing bills of credit, that 
 there was a strong presumption this power was intended to be exclusively 
 given to Congress. Mr. C. acknowledged there was no provision in the con- 
 stitution bv which States were prohibited from creating the banks which now 
 excersisc this power; but, he said, banks were then but little known there 
 was but one, the Bank of North America, with a capital of only 400,000 dol- 
 lars; and the universal opinion was, that bank notes represented gold and sil- 
 ver, and that there, could be no necessity to prohibit banking institutions 
 under this impression, because their notes always represented gold and silver, 
 and they could not be multiplied beyond the demands of the country. Mr. 
 C. drew the distinction between banks of deposite and banks of discount, the 
 latter of which were then but little understood and their abuse not conceived 
 until demonstrated by recent experience. No man, he remarked, in theconven- 
 tion, much talent and wisdom as it contained, could possibly have foreseen the 
 course of these institutions; that they would have multiplied from one to two 
 hundred and sixty: from a capital of 400,000 dollars to one of eighty millions; 
 from being consistent with the provisions of the constitution, and the exclu- 
 sive right of Congress to regulate the currency, that they would be directly 
 opposed to it; that, so far from their credit depending on their punctuality in 
 redeeming their bills with specie, they might go on, ad infinitum, in violation 
 of their contract, without a dollar in their vaults. There had, indeed, Mr. C. 
 said, been an extraordinary revolution in the currency of the country. By a 
 sort of under-current, the power of Congress to regulate the money of the 
 country had caved in, and upon its ruin had sprung up those institutions which 
 now exercised the right of making money for, and in, the United States: for 
 gold and silver are not the only money, but whatever is the medium of pur- 
 chase and sale, in which bank paper alone was now employed, and had, there- 
 lore, become the money of the country. A change, great and wonderful, has 
 taken place, said he, which divests you of your rights, and turns you back to 
 the condition of the Revolutionary war, in which every State issued bills of 
 credit, which were made a legal tender, and were of various value. 
 
 This then, Mr. C. said, was the evil. We have, in lieu ot gold and silver, a 
 paper medium, unequally but generally depreciated, which affects the trade 
 and industry of the nation; which paralyses the national arm; which sullies 
 
632 BANK OF THE UNITED STATES. 
 
 the faith, both public and private, of the United Statesa paper no longer 
 resting on gold and silver as its basis. We have, indeed, laws regulating the 
 currency ot foreign coin; but they are, under present circumstances, a mockery 
 of legislation, because there is no coin in circulation. The right of making 
 money, an attribute of sovereign power a sacred and important right was 
 excercised by two hundred and sixty banks, scattered over every part of the 
 United States, not responsible to any power whatever for their issues of paper. 
 The next and great inquiry was, he said, how this evil was to be remedied? 
 Restore, he said, these institutions to their original use; cause them to give up 
 their usurped power; cause them to return to their legitimate office of places 
 of discount and deposite; let them be no longer mere paper machines; restore 
 the state of things which existed anterior to 1813, which was consistent with 
 the just policy and interests of the country; cause them to fulfil their contracts; 
 to respect their broken faith; resolve, that every where, there shall be an uni- 
 form value to the national currency; your constitutional control will then 
 prevail. 
 
 How, then, he proceeded to examine, was this desirable end to be attained? 
 What difficulties stood in the way? The reason why the banks could riot now 
 comply with their contract was, that conduct, which, in private life, frequently 
 produces the same effect. It was owing to' the prodigality of their engage- 
 ments, without means to fulfil them; to their issuing more paper than they 
 could possibly redeem with specie. In the United States, according to the 
 best estimation, there were not, in the vaults of all the banks, more than fifteen 
 millions of specie, with a capital amounting to about eighty two millions of 
 dollars; hence the cause of the depreciation of bank notes the excess of paper 
 in circulation beyond that of specie in their vaults. This excess was visible 
 to the eye, and almost audible to the ear; so familiar was the fact, that this 
 paper was emphatically called trash, or rags. According to estimation, also, 
 ne said, there were in circulation, at the same date, within the United States, 
 two hundred millions of dollars of bank notes, credits, and bank paper, in one 
 shape or other. Supposing thirty millions of these to be in possession of the 
 banks themselves, there were perhaps one hundred and seventy millions actu- 
 ally in circulation, or on which the banks draw interest. The proportion between 
 the demand and supply, which regulates the price of every thing, regulates also 
 the value of this paper. In proportion as the issue is extensive, it depre- 
 ciates in value and no wonder, when, since 1810 or 1811, the amount of paper 
 in circulation had increased from 80 or 90 to 200 millions. Mr. C. here ex- 
 amined the opinion entertained by some gentlemen, that bank paper had not 
 depreciated, out that gold and silver had appreciated; a position he denied by 
 arguments founded on the portability of gold and silver, which would equalize 
 their value in every part of the United States, and on the facts, that gold and 
 silver coin had increased in quantity instead of diminishing, and that the ex- 
 change with Great Britain had been, (at gold and silver value/) for some time 
 past, in favor of the United States. Yet, he said, gold and silver were leav- 
 ing our shores. In fact, we have degraded the metallic currency; we have 
 treated it with indignity; it leaves us, and seeks an asylum on foreign shores. 
 Let it become again the basis of bank transactions, and it will re- visit us. 
 Having established, as he conceived, in the course of his remarks, that the 
 excess of paper issues was the true and only cause of depreciation of our pa- 
 per currency, Mr. C. turned his attention to the manner in which that excess 
 had been produced. It was intimately connected with the suspension of specie 
 payments; they stood the cause and effect. First, the excessive issues caused 
 the suspension of specie payments; and advantage had been taken of that sus- 
 pension to issue still greater floods of it. The banks had undertaken to do a 
 new business, uncongenial with the nature of such institutions; they under- 
 took to make long loans to Government, not as brokers, but as stockholders 
 a practice wholly inconsistent with the system of specie payments. After 
 showing the difference between the ordinary business of a bank, in discounts, 
 and the making loans for twelve years, Mr. C. said, indisputably the latter 
 practice was a great and leading cause of the suspension of specie payments. 
 
ON THE GRANT OF THE CHARTER OF 1816. (333 
 
 Of this species of property (public stock) the banks in the United States held, 
 on the 30th day of September last, about eighteen and a half millions, and a 
 nearly equal amount of treasury notes, besides stock tor long loans made to 
 the State Governments, amounting, altogether, to within a small amount ol 
 forty millions, being a large proportion of their actual capital. This, he said, 
 was the great cause of the suspension of specie payments. Had the brinks 
 (he now discussed the question) the capacity to resume specie paymentr It 
 they have the disposition, he said, they may resume specie payments, 
 banks are not insolvent, he said: they never were more solvent. If so, the 
 term itself implies, that, if time be allowed them, they may, before long, be 
 in a condition to resume payment of specie. If the banks would regularly and 
 consentaniously begin to dispose of their stock, to call in their notes for the 
 treasury notes they have, and moderately curtail their private discounts; it 
 they would act in concert in this manner, they might resume specie payments. 
 If they were to withdraw, by the sale of a part only of their stock and treasury 
 notes, twenty-five millions of their notes from circulation, the rest would be 
 appreciated to par, or nearly, and they would still have fifteen millions of 
 stock disposable to send to Europe for specie, &c. With thirty millions of 
 dollars in their banks, and so much of their paper withdrawn from circulation, 
 they would be in a condition to resume payments in specie. The only dim- 
 culty, that of producing concert, was one which it belonged to Congress to 
 surmount. The indisposition of the banks, from motives of interest, obviously 
 growing out of the vast profits most of them have lately realized, by vyhich the 
 stockholders have realized from twelve to twenty per cent, on their stock, 
 would be, he showed, the greatest obstacle. What, he asked, was a bank? An 
 institution, under present uses, to make money. What was the instinct of such 
 an institution? Gain, gain; nothing but gain: and they would not willingly 
 relinquish their gain from the present state of things, which was profitable to 
 them, acting as they did without restraint, and without hazard. Those who 
 believed that the present state of things would ever cure itself, Mr. C. said, 
 must believe what is impossible: banks must change their nature, lay aside 
 their instinct, before they will aid in doing what it is not their interest to do. By 
 this process of reasoning, he came to the conclusion, that it rested with Con- 
 gress to make them return to specie payments, by making it their interest to 
 do so. This introduced the subject of the national bank. 
 
 A national bank, he said, paying specie itself, would have a tendency to 
 make specie payments general, as well by its influence as by its example. It 
 will be the interest of the national bank to produce this state of things; be- 
 cause, otherwise, its operations will be greatly circumscribed, as it must pay 
 out specie or national bank notes: for, he presumed, one of the first rules of 
 such a bank would be to take the notes of no bank which did not pay in gold 
 .md silver. A national bank of thirty-five millions, with the aid of those 
 banks which are at once ready to pay specie, would produce a powerful effect 
 nil over the Union. Further, a national bank would enable the Government 
 to resort to measures which would make it unprofitable to banks to continue 
 the violation of their contracts, and advantageous to return to the observation 
 of them. The leading measure of this character would be to strip the banks 
 refusing to pay specie of all the profits arising from the business of the Go- 
 vernment to prohibit deposited with them, and to refuse to receive their 
 notes in payment of dues to the Government. How far such measures would 
 be efficacious, in producing a return to specie payments, he was unable to say; 
 but it was as far as he would be willing to go at the present session. If they 
 persisted in refusing to resume paymentsln specie, Congress must resort to 
 measures of a deeper tone, which they had in their power. 
 
 The restoration of specie payments, Mr. C. argued, would remove the em- 
 barrassments on the industry of the country, and the stains from its public 
 and private faith. It remained to see whether this House, without whose 
 aid it was in vain to expect success in this object, would have the fortitude to 
 apply the remedy. If this was not the proper remedy, he hoped it would be 
 shown by the proposition of a prtper substitute, and not opposed by vague 
 80 
 
(534 BANK OF THE UNITED STATES. 
 
 and general declamation against banks. The disease, he said, was dee p; it 
 affected public opinion; arid, whatever affects public opinion, touches the 
 vitals of the Government. Hereafter, he said, Congress would never stand 
 in the same relation to this measure in which they now did. The disease 
 arose in time of war the war had subsided, but left the disease, which it was 
 now in the power of Congress to eradicate ; but, if they did not now exercise 
 the power, they would become abettors of a state of things which was of vital 
 consequence to public morality, as he showed by various illustrations. He 
 called upon the House, as guardians of the public weal, of the health of the 
 body politic, which depended on the public morals, to interpose against a state 
 of things which was inconsistent with either. He appealed to the House, too, 
 
 greatly depreciated; in paper, depreciated from five to twenty per cent, be- 
 low the currency in which the Government had contracted to pay, &c. He 
 added another argument; the inequality of taxation, in consequence of the 
 state of the circulating medium, which, notwithstanding the taxes were laid 
 with strict regard to the constitutional provision for their equality, made the 
 People in one section of the Union pay perhaps one-fifth more of the same 
 tax, than those in another. The constitution having given Congress the power 
 to remedy these evils, they were, he contended, deeply responsible for their 
 continuance. 
 
 The evil he desired to remedy, Mr. C, said, was a deep one; almost incura- 
 ble; because connected with public opinion, over which banks have a great 
 control they have, in a great measure, a control over the press: for proof of 
 which he referred to the fact, that the present wretched state of the circulat- 
 ing medium had scarcely been denounced by a single paper within the United 
 States. The derangement of a circulating medium, he said, was a Joint 
 thrown out of its socket; let it remain for a short time in that state, and the 
 sinevys will be so knit, that it cannot be replaced apply the remedy soon, 
 and it is an operation easy, though painful. The evil grows, whilst the resist- 
 ance to it becomes weak; and, unless checked at once, will become irresisti- 
 ble. Mr. C. concluded the speech, of which the above is a mere outline. 
 which the imagination of the reader must fill up, by observing, that he could 
 have said much more on this important 'subject, but he knew how difficult it 
 was to gain the attention of the House to long addresses. 
 
 Mr. RANDOLPH, in explaining an allusion which Mr. Calhoun had made to 
 a remark of his, on a former occasion, took occasion to say, that he had lis- 
 tened to the honorable gentleman with pleasure. He was glad to see a cause 
 so important in hands so able. He promised the honorable gentleman, though 
 he might not agree in his mode ot remedying the evil, he would go with him 
 in the application of any adequate remedy, to an evil which he regarded as 
 most enormous, &c. 
 
 Mr. WARD, ol Massachusetts, made some remarks, not very distinctly 
 heard at the time He acknowledged the correctness of the representation of 
 the existing evil, for which he appeared to think the remedy was near at hand, 
 and more simple in its application than the establishment of a national bank, 
 viz: by refusing to receive the notes of those banks which do not pay specie 
 in dues to the Government. But for an alliance, which he considered clis- 
 
 aceful to the country, and unjust to individuals, between the Secretary of the 
 reasury and the banks which refused to pay specie, the evil never would 
 have existed. If Congre&s adopted the measure which he (Mr- W.) pro 
 posed, those banks must go down, and public credit rise. Why not resort at 
 hrst to the obvious expedient and then proceed to the consideration of the less 
 urgent question of establishing a national bank? The banks, who, it was now 
 agreed, had engaged in a business for which they were not calculated, having 
 received a sufficient bonus for the loans they made to Government, and made 
 
ON THE GRANT OF THE CHARTER OF 1816. 635 
 
 handsome profits by it, had no claim on Government to protect them in their 
 
 a o u 
 
 medy were not immediately applied, on them would be the responsibility and 
 
 the blame. 
 
 Mr. SERGEANT moved to amend the first section of the bill by striking put 
 the words " thirty Jive ;" and inserting twenty, as the amount of the capital 
 of the bank. He did not intend, he said, to go into a general consideration 
 of the principle of the bill, or of the motion now submitted by him. He made 
 the motion on the ground of the facts and arguments just delivered by the 
 gentleman from South Carolina, (Mr. CALHOUN.) From the quantity of pa- 
 per stated to be in circulation, he thought the calculation fair that the amount 
 proposed to be added to the existing bank capital was larger than necessary, 
 and entered into some caculations, not distinctly hearu, to support the pro- 
 priety of his motion. 
 
 Mr. CALHOUN hoped the motion would not prevail, and replied briefly to 
 the calculations of Mr. SERGEANT. The necessity o fa larger capital consist- 
 ed, he said, in the important functions to be performed by the national bank. 
 The desirable point was to fix the capital so large as to prevent undue profit, 
 and so as to prevent a loss to the stockholders. Perhaps a bank of twenty 
 millions might afford a fair profit; but the great business it would have to per- 
 form made a larger capital necessary, &c. 
 
 Mr. PITKIN supported the motion to reduce the capital. He thought the 
 banking capital of the country already too great, and offered a tew calcula- 
 tions to prove the position. In 1805. 1806, and 1807, said he, when the com- 
 merce of the country was very great, our banking capital did not exceed fifty 
 or sixty millions; and yet, in those times, no complaint was heard of the de- 
 ficiency of capital. If not more than that amount was wanted then, is it 
 possible that one hundred and thirty or one hundred and forty millions can 
 be necessary at this time? Mr. P. declared himself in favor of a national 
 bank, if it could be established on good principles, such as would restore the 
 old state of things, when bank notes were paid with specie. If, however, the 
 bill passed with its present capital, it would, in his opinion, increase the evil 
 instead of proving a remedy. Such a capital was not necessary, either, for 
 the purposes wanted. As to loans, no bank could make long loans without 
 stopping the payment of specie, and destroying the circulating medium; and, 
 to support the assertion, he quoted the fate of various banks in Europe. A 
 large capital for that purpose, therefore, was unnecessary. Loans, he said, 
 must be made by individuals; it cannot be done by banks, without ruin; and 
 a large capital was not necessary, therefore, to enable the Government to ob- 
 lain from the bank all the aid it could, or ought properly to receive. Nor 
 would a large capital, he said, restore the old state of things; that must be 
 done by the co-operation of the large banks in the cities; the specie has got 
 into those banks, and there it will remain until they resume the payment of 
 it. Mr. P. said, likewise, he was unwilling to place fifty millions of money 
 in the hands of any set of men in this country. They would use it oppres- 
 sively; the old Bank of the United States had done so, and so would this. 
 Such a power would enable them to wield the destinies of this nation. For 
 this strong reason, Mr. P. said, as well as the others he had stated, he was in 
 favor of reducing the capital; and, to allow more time to reflect on this im- 
 portant feature of the bill, he moved that the committee rise. 
 
 After a few remarks by Mr. CALHOUN, on what had fallen from Mr. PITKW 
 The committee rose, reported progress, and obtained leave to sit again. 
 
 FEBRUARY 27, 1816. 
 
 In committee of the whole, Mr. SERGEANT'S motion to reduce the pro- 
 posed capital from thirty-Jive to twenty millions, being under consideration 
 
636 BANK OF THE UNITED STATES. " 
 
 Mr. SMITH, of Maryland, rose to express his views of the subject generally, 
 as well as on the particular point under consideration. He appeared to coin- 
 cide in opinion with Mr. CALHOUN. that the establishment of a Bank of the 
 United States would contribute, better than any other measure, to the resto- 
 ration of a general medium of circulation of uniform value: he was afraid, he 
 said, that it was the only remedy. Perhaps, he said, he should not agree 
 with the gentleman in some of his positions, particularly as respected the 
 conduct and state, of the banks. It might be prudent on the part of Congress, 
 he remarked, to let down these institutions as gently as they could, and do 
 every thing to enable them to meet their enagements'by specie payments, on 
 some future day. With some modification of the plan proposed by this bill, 
 he thought the establishment of a national bank would effectually contribute 
 to that object. The banks, pending the war, were the. pillars of the nation, 
 on which, and through whose instrumentality, the Government was enabled 
 to raise money and men to carry on the war, not only by their direct loans, 
 but by enabling individuals to make loans to the Government. Now, that 
 we could do without them, they had been called caterpillars. He would not 
 call those caterpillars now, who in war had been the pillars of the Govern- 
 ment. The information of the gentleman in relation to the state of the banks 
 might be very good, but it did not coincide with the in formation or impression 
 of Mr. S. who took a different view of it. He thought that, as far as he had 
 information, the banks had not issued more notes than, from the amount of 
 their capitals, they had a fair right to do. Adverting to Mr. C's statement 
 of the number of the banks, (he wished there were not so many) and of their 
 capital, he differed from the view which estimated the amount on which thej" 
 draw interest, at an hundred and seventy millions. But, deducting from this 
 amount the loans, &c. estimated at forty millions, a hundred and thirty mil- 
 lions \yould remain, as the estimated amount on which the banks draw inter- 
 est, with a capital of eighty -two millions. Was this too much? With much 
 less, could the banks pay bank expenses, and make a reasonable dividend? 
 But, might not the gentleman have been mistaken, even in this estimate? Mr. 
 S. thought he was, and supported this impression by a reference to such docu- 
 ments on the subject as were within his reach. He referred to the document 
 on the table, showing the state of the chartered banks within the District of 
 Columbia. He was rather inclined to believe, he said, that these banks had 
 gone a little further than most of the banks of the United States in their issues, 
 the cause of which might be traced to the large loans to the Government. 
 The amount of the capital paid in by all these banks was 3,321,600 dollars; 
 the bills and notes discounted 4,830.031 dollars. Was this too large a business 
 on their capital? These banks, than which, perhaps, no banks in the Union 
 had done larger business, had not discounted more than fifty per cent, beyond 
 the amount of their capital paid in. As to the amount of paper which the 
 gentleman estimated to be in circulation, Mr. S. differed widely from him. 
 Instead of two hundred millions of dollars of paper being in circulation on a 
 capital of eighty-two millions, he doubted whether the amount was half that 
 of the capital of the banks, say forty-one millions of dollars. He had some 
 acquaintance with the operations of banks, from his practice in them. Some 
 banks could put out more paper than others, from their particular situation: 
 but, in general, banks did not issue paper to more than half the amount of 
 their capital. The notes of the banks of this district were more depreciated 
 than any others; and if the depreciation was in fact owing to excessive issues, 
 it might be presumed they had issued more largely than banks generally. 
 These banks had notes in circulation to the amount of 2,094,000 dollars a 
 greater proportion of notes to their capital, than banks generally have in cir- 
 culation; but only three-fifths of the amount of the capital paid in. There 
 were not now in circulation, Mr. S. said, he verily believed, as many bank 
 notes, properly so called, as there were prior to the stoppage of specie pay- 
 ments. Banks every where were endeavoring to draw in their notes. Mr. 
 S. concluded on this point, that, as the banks had demonstrably not been prodi- 
 gal in the issue of their paper, its depreciation was not owing to the excess of 
 
ON THE GRANT OF THE CHARTER OF 1816. 
 
 issue. This brought Mr. S. to another point of Mr. CALHOUN'S speech, in 
 which they concurrred in opinion. To the long loans he agreed, in a great 
 measure might be attributed the depreciation of the paper of this city, of Bal- 
 timore, Philadelphia, and of New York. But he was not disposed to censure 
 the oanks for having made those loans. On the contrary, said he, they aided 
 you in times of need;,.! give them credit for it. I would nurse them, and bring 
 them back to the same healthy state as before they reduced themselves to 
 serve you. At the same time Mr. S. said he agreed, that it was the duty of 
 the banks to resume specie payments, so soon as it was possible to do it with 
 out loss. If they did not do it, they ought to be compelled to do it; and through 
 the instrumentality of a Bank of the United States, the Government might 
 be able to coerce them. The loans made to the Government, he said, had 
 been principally confined to the country between the Hudson and the Poto- 
 mac; a small amount only had been obtained North and South of these limits. 
 The notes obtained by the treasury by way of loan, were disbursed in other 
 quarters of the country than that in which they were obtained; they had been 
 thrown back upon the banks, and specie demanded for them, with which 
 demand, made in large quantities, the banks found themselves unable to 
 comply. The gentleman had given his opinion how the evil might be reme- 
 died. This remedy, Mr. S. went on to observe, he was one of those who 
 had pressed on the directors of the banks of the city he had the honor to 
 represent. All the banks had to do, he said, was to send their millions of 
 stock to the Eastward and Southward, sell their stock, and thus change the 
 balance of exchange and trade in their favor. When they should do that, the 
 cause of the depreciation of their paper being removed, Mr. S. said we should 
 hear no more of it: in less than three months, those States which now had 
 the advantage of the exchange, would be the debtor States. The difference 
 in exchange was little more" than nominal very little specie being paid in 
 any part of the country; where bank notes were nominally at par, the banks 
 did very little or no business, and had comparatively no notes out. If mer- 
 chants negotiated with those banks, they did not receive or pay them specie, 
 but paper. Mr. S. coincided in Mr. C's view, that, if all the banks agreed 
 to resume specie payment*, they might do it; but he would use no coercion 
 now to hasten the period, but suffer them to do it peaceably and quietly, and, 
 therefore, safely. 
 
 Adverting to the observation in debate yesterday, respecting an alliance 
 between the Secretary of the Treasury and the banks, which had prevented 
 treasury notes from becoming a circulating medium. &ic. Mr. SMITH vindicated 
 the conduct of the treasury. Could the Secretary do otherwise, he asked, 
 than receive the public dues in the currency of the country where they were 
 collected? The Secretary had further undertaken (Mr. S. doubted whether 
 that officer had not in this gone too far) to say, that the paper of those banks 
 which did not receive treasury notes and issue them again, should not be 
 received in payment of debts due to the Government. Gentlemen were mis- 
 taken, Mr. S. contended, if they supposed that they could make treasury notes 
 a circulating medium; experience had proved it Referring to the value of 
 treasury notes, depreciated gradually in their progress from this district to 
 Boston, he remarked, that although they were six per cent, above par at Bal- 
 timore, they were riot there as valuable as the note of a merchant at New 
 York. It would, it was true, be a great convenience, it Government could 
 issue a paper of this sort which would serve as a circulating medium; but it 
 could not; whatever paper was put out, of that sort, would become an article of 
 merchandise, to be bought and sold. The community was now accustomed 
 to bank notes, and partial to them; and their place could not be supplied by 
 Government paper. 
 
 As to the motion now under consideration, to reduce the capital, Mr. S. 
 said he had not expected it from a gentleman from Pennsylvania, and particu- 
 larly not from the gentleman who made it. Reverting to the period of the 
 establishment of the Bank of the United States, he said, ten millions bore a 
 larger proportion to the uses and demands of that day, than thirty-five mil- 
 
(338 BANK OF THE UNITED STATES. 
 
 lions did to those, of this. The price of every thing was then very low, com- 
 merce in its infancy, the shipping of the United States extremely and almost 
 incredibly limited, &c. It was impossible that any man could suppose that 
 a bank of the same amount could now perform the functions which the Bank 
 of the United States then performed, particularly since the Government had 
 spread taxes over the whole surface of the country, and made the aid of this 
 institution more extensively necessary. With a reduced capital, Mr. S. said, 
 the operations of the bank would be so circumscribed, that it would afford 
 but little aid to merchants. He was not, indeed, very tenacious, he said, 
 about four or live millions of capital, -more or less; but he did not think thirty - 
 five millions at all too much. 
 
 Mr. S. said he was not entirely satisfied with the plan of the bank, proposed 
 by the committee; but might not the plan be so modified as to meet the views of 
 a large majority of the House? He could find but few gentlemen, he said, who, 
 in conversation, did not appear favorable to the establishment of a bank. 
 Some preferred a plan less complex than the present: some were hostile to 
 the control of the Government in it, in which, perhaps, they were right. 
 Others were hostile to treasury notes forming any part of the capital; in which, 
 Mr. S. said, he concurred. Where was the difficulty in yielding those minor 
 points, for the sake of obtaining a general concurrence in favor of the bill? 
 Other features were objected to: the power to authorize suspension of pay- 
 ments in specie, &c.; these he would also give up, rather than that they 
 should defeat the bill altogether. As to the question, when the specie pay- 
 ments of the bank should commence, Mr. S. said, according to the proposed 
 mode of payment, it would not be very soon, &c. To remedy this objection, 
 he proposed that, for the seven millions of treasury notes to be paid in on 
 account of the United States, there should be substituted a stock to be created 
 for the purpose, bearing an interest of 5 per cent, per annum, which would 
 leave a gain to the United States (the bank dividing eight per cent.) of three 
 per cent, per annum on that amount; which would, by its accumulation and 
 proper application, in the course of twenty years, absorb the whole of that 
 stock, and operate as a bonus to the United States to that amount. He also 
 showed, by calculation, that'the United States, in this mode, by merely ad- 
 vancing their credit, might absorb twelve millions of the war debt; which he 
 believed would be no unpalatable thing to the People, nor unwise in the Go- 
 vernment. Further, Mr. S. said, he wished to see the bank go immediately 
 into operation; that, while he lived, he might derive some advantage from it. 
 He would, therefore, wish to see the whole of the specie part of the stock paid 
 in within a given number of months. With seven millions of dollars in its 
 vaults, the bank would have neither fear nor trembling in commencing specie 
 operations; they would have time to send their stock to Europe for sale, or 
 make such other arrangements as, in their opinion, might be proper. The 
 specie thus to be paid in, would not drain the State banks, but would be 
 imported for the purpose, from Europe and elsewhere, &c. In the mean time, 
 he said, until all the specie payments were made to the bank, he did not 
 think it would do any harm if the bank were to commence its operations 
 without specie, but with an assurance in its charter, of payment of specie at 
 a particular day. Such an assurance would make the bank notes equally good, 
 in his eyes at least, as gold and silver. With these views of the subject, Mr. 
 S. concluded his practical speech. 
 
 Mr. SERGEANT next addresssed the Chair, in support of his motion to reduce 
 the proposed capital of the bank. In reply to Mr. SMITH'S expression of sur- 
 prise at his having made this motion, he said, it was no reason why a repre- 
 sentative from one part of the country should not move an amendment to a 
 bill, that the bill in its present shape was more agreeable to another section. 
 Mr. SERGEANT said, he had made the motion for two reasons; first, because, 
 from the showing of the gentleman from South Carolina, the banking capital 
 of the country was already large enough; and, secondly, that he might have 
 an opportunity of hearing gentlemen explain their views on this subject, which 
 
ON THE GRANT OF THE CHARTER OF 1816. 639 
 
 he believed was the correct mode of procedure, when members could not 
 see their way very clearly on any subject, particularly when it was proposed 
 to legislate without the power of repeal for twenty years to come, and when 
 that legislation was to create a vast machine, the direction of whose momentum 
 is to be put into the hands of we knovy not whom. A similar question, less 
 extensive in its nature, on the proposition to renew the charter of the Bank 
 of the United States, had agitated the country from one extreme of the con- 
 tinent to the other, and Congress particularly. This agitation had been so 
 recent, that the proposition of a similar character ought to give rise, at this 
 time, to serious reflection, at least, if half that had been then said on the sub- 
 ject was true. The present measure, Mr. 8. said, presented itself to him in 
 an infinitely worse aspect than that to which he had referred, and the two 
 gentlemen who had discussed the question, had shown, that the best inform- 
 ed and most zealous in favor of the measure, did not understand its bearings, 
 or agree in its effects or principles, &c. The question was yet to be decided 
 between those gentlemen, he said, whether this was to be a specie, or a paper 
 bauk; but, for his part, he protested against the establishment of any bank 
 which was not, from the beginning, a specie bank. He saw u wide distinc- 
 tion between the bank now proposed to be established, and the old Bank of 
 tl.e United States; the object ot the latter was to increase the active capital ot 
 the country, and to facilitate the operations of the Government in the collec 
 tion of the taxes, whilst the motive of this bank was directly the reverse^ it 
 wa- not to increase, but to diminish the paper medium of the country. The 
 surcharged circulation of paper, Mr. S. then argued, would not be removed 
 by throwing in the additional quantity of paper to be issued by this bank. The 
 great extent of the proposed capital of the bank, three and an half times that 
 of the late Bank of the United States, (with the privilege to increase it to five 
 times the amount) imposed it as a duty on those who advocated it, to show 
 the use of so large a capital, in answer to the argument that our commercial 
 transactions had increa^-d -nee 17'J1, in the proportion of five to one, Mr. S. 
 said gentlemen appeared to have entirely lost sight of a consideration which 
 was essential in the discussion ot this subject; that, in 1791, we had but three 
 banks, and now, we had two hundred and sixty, supplying a capital of more 
 than twenty times the amount then in existence. This additional capital was, 
 therefore, he argued, not necessary to the purposes of commerce. As the 
 means of establishing an uniform medium of circulation, Mr. S. contended, 
 that a capital of twenty millions would be large enough for any useful pur- 
 pose, and would be able to throw into circulation a larger amount than that 
 of depreciated paper, which the gentleman from South Carolina proposed to 
 withdraw from circulation, in order to appreciate the notes of existing banks. 
 This bank, established on true commercial principles, (and such he wished it 
 to have) would be guided by that instinct of gain which the gentleman had 
 ascribed to banking institutions, and, with a capital of twenty millions, would 
 do a business quite extensive enough to answer any useful purposes. 
 
 Mr. S. further objected to the plan of the bunk embraced in this bill, that 
 there was nothing in it which would save this national bank from the same 
 extremity of difficulty, bankruptcy if gentlemen chose to call it so, in which 
 other banks had been involved; it had no other liability or responsibility for 
 its engagements than those which are common to every other bank. Mr. S. 
 did not join in the censure of banks for that which was said to have been the 
 cause of suspension of specie payments, viz. the loans to Government, which 
 the pressure of Government and public sentiment had urged them to make to 
 the Government in a greater extent than they ought to have done. He was 
 willing to coerce the banks to pay specie, if they were not disposed to do it 
 when they could; but, he intimated, he was unwilling to try an experiment, 
 which, if it did not operate as he wished, would only have a tendency to ag- 
 gravate the evil. 
 
 If the State banks had violated their laith, how, he asked, did the Govern- 
 ment stand in that respect? Let the Government set the example of redeem- 
 ing its plighted faith. How was the public creditor paid at Philadelphia du- 
 
640 BANK OF THE UNITED STATES. 
 
 ring the war? Instead of being paid in gold and silver, or their equivalent, 
 they were paid in notes of the banks of Baltimore, which had depreciated five 
 or six per cent, at that very time. This mischievous example having been set 
 by the Government to the banks, ought fault to be found with them that they 
 did not pay their notes, when Government had given them the example? 
 With regard to the present time, he said he should be glad to know why the 
 treasury of the United States had not now the command of the specie pay- 
 ments and rate of exchange in its own hands? How much better, if the Go- 
 vernment had this power, as he believed they had, that they should exercise 
 it to compel the resumption of specie payments? 
 
 Mr. S. then proceeded to examine the composition of the thirty-live mil lions of 
 capital of this bank. Referring to the report of the state of the banks ot Penn- 
 sylvania, he said the Philadelphia banks, confessedly not specie banks, were 
 in very nearly the same situation as this bank would be when it commenc- 
 ed operations. The Bank of Pennsylvania, for instance, with a capital of 
 2,500,000 dollars, had 1,800,000 ot" public stock, 400,000 ot specie, &c. How 
 was that bank worse oft' than this bank of the United States would be, with 
 three-fourths of its stock public debt and treasury notes, and one-fourth spe- 
 cie? &c. 
 
 In every view this was a measure of doubtful expediency, and it would be 
 sufficient if he were to say he would not grope in the dark, on a measure of 
 so doubtful a character; especially as it proposed to throw into circulation a 
 quantity of paper on principles which he saw, in existing establishments pos- 
 sessing the same materials, could not be redeemed with specie, &c. He wish- 
 ed explicitly to understand whether this was to be a bank for commercial pur- 
 poses, or a Government bank. He could not for the life of him conceive, he 
 said, why the Government was to become a partner to a scheme of this sort at 
 all. He was willing to have a bank on plain intelligible principles; not a bank 
 of deposite merely :tor at this time of day people could not be found who would 
 willingly embark their funds in any thing so limited: but he would not au- 
 thorize the bank to issue any paper beyond the amount which it could redeem 
 with specie. The notes should express on their face the currency or paper 
 with which they should be redeemed, specie, treasury notes, or stock: tor, 
 as he showed, by various elucidations, money only could justly redeem a note 
 given for money by an individual or by a government, &c. Prior to 1814 ? it 
 had not been supposed that the banks had not conducted themselves on iair 
 principles; the very instant, however, a state of things arose to create alarm, 
 or when, from whatever cause, their notes were presented for payment, that 
 moment the banks were unable to proceed in specie payments. This bank 
 being put in operation on the same principles, how would it succeed better? 
 Mr. S. concluded the speech, of which the preceding is a mere skeleton, by 
 saying that he yet remained to be convinced that twenty millions were not a 
 sufficient capital for ail the purposes for which the bank could be wanted. 
 
 Note by the editors of the National Intelligencer. 
 
 [We are requested by Mr. SERGEANT to give the following 1 as a statement of what 
 he said, or meant, on one point of his remarks on the bank question. It is scarcely 
 necessary to say, that the reporter, in the hasty sketch of that debate, does not aim 
 at any thing 1 like verbal accuracy or amplitude the limits of a newspaper, connected 
 with the desire to place the substance of the arguments and proceeding's promptly 
 before the readers of the National Intelligencer, forbid it.] 
 
 Mr. SERGEANT said, that it was necessary first to decide whether we would 
 have a specie bank or a paper bank. If we are to have a specie bank, I can- 
 not consent to any bill for that purpose, unless it contains such provisions as 
 will afford a reasonable certainty that it will be able to pay specie. If it should 
 commence its operations as a specie bank, and afterwards be obliged to sus- 
 pend specie payments, when its notes shall have gone extensively into circu- 
 lation, it will produce all the consequences, so strongly described, which have 
 followed the suspension by the State banks, in a still greater degree. I should 
 
ON THE GRANT OF THE CHAR PER OF 1816. (341 
 
 very much prefer a plan more simple and intelligible, that is, to allow the 
 bank to issue no more notes for the payment of money than you are sure they 
 can pay. If more paper is necessary, let it be paper in a different form, import- 
 ing, on the face of it, no engagement to pay specie certificates of credit, for 
 instance, receivable in payments to the bank or the Government. 
 
 Mr. RANDOLPH rose to ask two questions, one of the gentleman from South 
 Carolina, the other of the gentleman from Maryland: first, how the paper to 
 be created by this bank will correct the vitiated state of our currency? And, 
 secondly, how bank notes can answer the purpose of a circulating medium 
 better than treasury notes? Though no stickler for treasury notes, Mr. R. 
 intimated his opinion that they were, in time of peace, a better substitute tor 
 gold and silver, than any paper he had heard yet submitted. Mr. R. added 
 some incidental observations, amongst which was the remark, that he was 
 sorry to see the apathy, the listlessness on this subject; on a question, which, 
 if it passed, would, perhaps, be the most important decided since the establish- 
 ment of the constitution; and that, though he agreed fully as to the extent of 
 the existing evil, the remedy had been totally mistaken, &c. 
 
 Mr. SMITH said, in reply, that the gentleman from Virginia, and himself, 
 only differed in premises, not in their conclusions; and then answered at 
 some length, the arguments of Mr. SERGEANT. Banks, to obtain a fair profit, 
 he said, must discount to fifty per cent, more than the amount of their capital: 
 but he would be willing they should not be allowed to issue paper to an amount 
 beyond one-half their capita!. lie had stated that the banks of Columbia, at 
 this time, had not more than two-fifths of their capital paid out in nv.tes, and 
 the old Bank of the United States, at no period, had out more than ten mil- 
 lions of notes; and this bank, unless it should sell its stock, could only do 
 business to the extent of the cash in its vaults. Mr. S. protested against the 
 attempt at dexterity, which was imputed to him by Mr. Randolph. He had 
 distinctly stated his opinions, arid argued fairly; he had asserted that the notes 
 of this bank would be every where better than treasury notes; but it was on 
 the presumption that the bank would redeem its issues with specie; and he 
 repeated, that, it the bank be compelled to pay specie in a short time, as he 
 was sure it would, then its notes would be greatly preferable to treasury notes, 
 whether at Boston or New Orleans, &c. 
 
 Mr. WARD, of Massachusetts, hoped the amendment vyoukl prevail. He 
 acknowledged that, in the progressive state of this country, it was not very im- 
 portant whetherthe capital was thirty -five or twenty millions; thelatteramount 
 could be used with nearly as much ett'ectforany mischievous purpose as the former 
 that sum would be quite sufficient to influence the destinies of this nation. 
 But he preferred the smaller sum, because he believed that amount large 
 enough for every commercial purpose. During the existence of the old Bank 
 of the United States, a period of very great commercial activity, that institu- 
 tion answeiedall the demands of the country; and he was confident that twenty 
 millions now, in addition to the local capital, was enough. Mr. VV defended 
 the Boston banks from the charge of deception, in promising to pay specie 
 without doing so. They had not, he said, broken their faith to the public, and 
 any man could there obtain specie whenever he presented one of their notes 
 for payment. If this bank is to pay specie, said Mr. \V. I admit that it will 
 be very useful; but if it does not, its notes will be much below the value of 
 treasury notes, and will not answer any ;ood purpose. He quoted the price 
 of treasury notes at different places, and detailed the reasons for their unequal 
 value; and such he said would be the condition of the notes of a national bank, 
 unless bottomed and conducted on a specie capital. To expect a paper of 
 unequal value to answer the purposes of a general medium, would be as bad, 
 he said, as to expect pieces of cloth of different lengths to cover an equal space 
 of ground in every part of the country. Mr. W. believed that nothing but 
 mismanagement hud caused the inequality in the value of treasury notes 
 81 
 
BANK OF THE UNITED STATES. 
 
 These notes were a common paper, emanating from the trustees of the people, 
 to whom all the people were more or less indebted; and this paper could only 
 have been depreciated by misconduct; which opinion he entered into some 
 details to prove. 
 
 This bank, it was asserted, would remedy the great evil now existing in our 
 depreciated currency. He did not believe it would. If the gentleman from 
 Maryland, (Mr. SMITH) were to lay down before him a machine, and tell him 
 it would fly, the gentleman would pardon him for saying he could not credit 
 it, until he showed some means which would enable it to do so. So it was, 
 he said, with the bank now under consideration. He deprecated the present 
 state of things as much as any one, and hoped an adequate remedy would be 
 provided. The United States, he said, lost, at present, by the depreciated 
 currency, more per annum than the whole amount derived from the direct tax 
 in the large State of Maryland. Such an evil called loudly for a remedy, 
 and he hoped one would be applied; but a bank on the plan now proposed 
 would disappoint its advocates, and fail to cure the evil. That this cure 
 would be complete he did not however expect from any plan some inconve- 
 nience would attend any remedy; it was to be expected like the amputation 
 of a limb to, preserve life. In reply to an assertion made in the course of 
 the debate, Mr. W. denied that the banks had loaned to the Government from 
 any other motives than those of gain. Their turn had been served, he said, and 
 in devising the plan of a national bank he should not be influenced by any 
 strong regard for their interest. But the present question was on reducing 
 the amount of capital; and he concluded by saying that, as the larger sum 
 would increase the means of doing mischief, and the smaller would be suffi- 
 cient for every useful purpose, he should vote to reduce it to twenty millions. 
 
 Mr. WRIGHT made a few remarks against the amendment. In former 
 times, a capital often millions was found necessary; and the increased demands 
 of the country would certainly require now the amount proposed by the bill. 
 He declined giving, at present, he said, any opinion on the measure itself; but 
 it a bank was to be created, it ought not to be less than thirty-five millions. 
 
 MR. TUCKJER said that, before the question was taken, he would offer a few 
 remarks on the propriety of rejecting the proposition of the gentleman from 
 Pennsylvania, and of retaining the amount of capital which formed a consti- 
 tuent part of the plan of the committee that reported the bill. He would not 
 enter into the general question at this time: he would waive all inquiries, for 
 the present, into the constitutionality of the scheme, and into the policy of 
 establishing an institution such as was in contemplation. By the amendment 
 proposed, he considered it to be admitted that a bank was necessary, and that 
 a considerable capital would be required to effect the important, the essential 
 purposes which had induced the Committee of Finance to submit to the House 
 a measure of so much magnitude, for their adoption. The question immedi- 
 ately before the House, and to which he should, therefore, strictly confine 
 himself, is not whether this institution shall be erected, but whether the capi- 
 tal proposed be too great to accomplish its object. 
 
 In this inquiry, said Mr. TUCKER, I shall not dwell upon the danger of the 
 bank as a great political engine, because I am inclined to agree with an honora- 
 ble gentleman from Virginia, that, in this point of view, there is very little 
 difference between a bank with a capital of twenty millions and one with a 
 capital of thirty -five millions. If the bank can be used, and shall be used as 
 an engine of oppression, the smaller sum would have little to recommend it in 
 preference to the larger. We should scarcely discern the difference between 
 the pressure of the two, distributed as the capital must be, through all the 
 States of the continent. If, then, gentlemen are averse to a bank with thirty- 
 live millions of capital, because they conceive it dangerous to the liberties of 
 the country, are they serious in declaring that they are in favor of such an 
 institution, with a capital of twenty millions? Have they shown any reason 
 for the opinion that the latter will not be injurious, if the former will prove 
 
ON THE GRANT OF THE CHARTER OF 1816. (J43 
 
 destructive; or are we to understand the proposition as indicative of a dispo- 
 sition hostile to the institution altogether, and not merely hostile to the bill 
 before you, because of the exorbitant capital proposed? I hope not. Gentle- 
 men assure us that they are favorable to the establishment of a bank with 
 such a capital, and on such principles as are consistent with the general wel- 
 fare, and 1 am.willing to place all proper confidence in their sincerity. I must 
 suppose, therefore, that they rest their objections to the amount ot the capital 
 on other grounds than that which has been suggested, since that would be 
 equally fatal to every such institution, whose capital was at all calculated to 
 effect the ends of the establishment. 
 
 The question as to the proper extent of the capital, must mainly depend on 
 the result of an inquiry as to the probability of a bank of thirty-five millions 
 carrying on its business profitably to the stockholders. If the proposed bank 
 can readily find employment for the whole of the proposed capital, there can 
 be no reason for diminishing it, with a view to the profits of those concerned. 
 That such will be the case, must readily be admitted, when we refer to ac- 
 knowledged facts, and apply them to the situation in which this institution 
 will be placed. Of the amount of thirty-five millions, twenty-eight millions 
 will consist of United States' stock, carrying an interest of six per cent., and 
 thus, of itself, affording employment for so much of the capital. The residue, 
 of seven millions, distributed through the Union, cannot fail to find employ- 
 ment. Facts within our knowledge, furnish the best test on this subject. 
 We have been told, in the course of the debate, that when the old bank of 
 the United States was established, there was only one other bank in existence 
 whose capital did not exceed four hundred thousand dollars. Since that time, 
 the number of banks has increased io upwards of two hundred and fifty, and 
 the bank capital to more than eighty-two millions. Does not this fact prove 
 the readiness with which bank capital can find employment among us? Does 
 it not prove that, in this new country, which is every day opening to the popu- 
 lation, new occupations for capital in agriculture, commerce, and manufac- 
 tures, there is no difficulty in disposing ot real or fictitious capital in stimulat- 
 ing the active industry of the nation? Is it not, indeed, in strict conformity 
 with the doctrines of all political economists and with the. experience of every 
 practical man, that in all new and growing countries, the great difficulty 
 is not to find employment for capital, but to supply the demancffor it? Is not 
 our comparatively high interest itself an evidence that, notwithstanding the 
 immense increase of capital, the demand has kept pace with the increase? If, 
 as has been justly contended, the rate of interest is governed by the propor- 
 tion between the demand for capital and the supply, the rate of interest here 
 proves, that capital has not yet equalled that proportion to the demand which 
 exists in other countries. The argument, then, which has been advanced in 
 debate, that \ve cannot require so large a capital, because that of Great Bri- 
 tain is not as great, is not entitled to much consideration, for the reasons I 
 have mentioned. New countries always require a greater capital, in propor- 
 tion :o their actual wealth and population, than old ones, because the held for 
 its employment is always more extended in the former than in the latter. 
 And, if the question as to the expediency of establishing new banks, depended 
 only on the probability of their finding employment tor their capital, none 
 could doubt of the propriety of the measure. We have, indeed, on this sub- 
 ject, a test which rarely errs. Mercantile men are aware that additional capi- 
 tal can be employed in banking, >yith great advantage to the bankers. They 
 form a class of our population which is proverbially said to understand its pe- 
 cuniary interests, and to make accurate calculations of profit. These and 
 others are every were engaged in the effort to establish new banks. In New 
 York, as I have understood, it is contemplated to put into actitvity an addi- 
 tional bank capital of fourteen millions. In the State which I have the honor 
 to represent, efforts have been lately made to establish fifteen new banks, with 
 a capital, I presume, of about seven millions. Do not these things prove thai 
 there is a fair prospect of profit; and that, however we may differ as to the 
 policy of increasing those establishments, there is no ground for supposing 
 
644 BANK OP THE UNITED STATES. 
 
 they will find difficulty in employing their capital? If so, I think we may; 
 reasonably suppose, that the bank of the United States (of whose capita! 
 twenty-eight millions will be at once actively employed) can readily find oc- 
 cupation lor the residue. 
 
 Another important subject of inquiry in relation to the extent of the capital 
 of the proposed bank, is connected with a supposed probable increase of 
 the circulating medium or of the bank notes in circulation. It has been con- 
 tended by the gentleman from Pennsylvania, (Mr. SERGEANT) that the esta- 
 blishment of this bank would increase instead of diminishing the evil which 
 the chairman of the Committee of Finance has so ably inveighed against. 
 That evil is the surcharged state of the circulation? and the idea seems to have 
 been entertained, that the issue of the United States' Bank will still further 
 " surcharge it." 
 
 If this argument be correct, it would be fatal to a bank of twenty millions; 
 nay, to every bank that can be now established. Will the gentleman then 
 urge it, when he professes his friendly disposition to the establishment of a bank 
 with a smaller capital? It is, however, I conceive, an argument at variance 
 with acknowledged facts, it is not true, that a superabundant paper medium- 
 can be forced into circulation, so long as specie redemptions are preserved. 
 Bank notes cannot go out, unless they are wanted, so long as the banks re- 
 deem them when demanded. It is an aphorism among political economists, 
 that it is impossible to surcharge the circulation, whilst specie is the basis of 
 that circulation. The truth is self-evident, and has been happily illustrated 
 bv the celebrated author of the Wealth of Nations, who has remarked that the 
 channel of circulation can only contain a certain quantity, and if more be 
 attempted to be poured into it, it will flow back upon its source. I am ready 
 to admit, that unlimited and blind confidence in banking institutions, may 
 sometimes enable them to over deal; but I need not stop to show that no sucn 
 blind confidence now exists or is likely to prevail. 
 
 The danger of a surcharged circulation when specie redemption shall have 
 been resumed, seems then to be visionary. The Bank of the United States 
 will either be unable to send its notes into circulation, or it will drive in a 
 part of the notes of the State banks. That the former will not be difficult, 
 every day's experience demonstrates. Every ^! an ^ tnat ! 9 established, soon 
 finds means to push out as much paper as its business requires. Why, there- 
 fore, should we believe for a moment, that the Bank of the United States, 
 whose paper will be desirable for so many reasons y will find that an insuper- 
 able barrier, which is so easily surmounted by others? If, as has been shown* 
 it can lend its capital, its borrowers will circulate its paper, and the natural 
 effect will be to diminish, in proportion, the circulation of the paper of the 
 State banks. But this effect will be produced without an injury to them. It 
 is an error to suppose that the business of a bank is always measured by the 
 quantity of its paper in circulation. It rarely happens that any bank has notes 
 in circulation equal to the amount of its actual capital, and it is notorious that 
 they sometimes draw interest upon twice the amount of the paper which they 
 have afloat. Having risen, without preparation, merely to reply to some of the 
 arguments that have been used by gentlemen, I am unprovided with the 
 estimate lately published of the state of the Philadelphia banks. If I am not 
 mistaken, the amount of notes discounted, Government stock, &c. on which 
 they drew interest, was nearly three times as great as their notes in circula- 
 tion. I have before me. a statement of the banks of this District, whose 
 issues have been generally deemed more excessive than those of any other 
 place. From this, I find that, whilst their actual capital somewhat exceeds 
 the sum of three millions of dollars, their notes in circulation are only two 
 millions ninety-four thousand; and whilst the same institutions have lent out 
 in discounted notes and Government stock six millions two hundred and 
 eighty thousand dollars, their notes in circulation have not exceeded two mil- 
 lions ninety-five thousand dollars, which is about one. third of the sum on 
 which they are making a profit. Here, then, we have decisive evidence of 
 what every man, at all acquainted with banking transactions, must know, that 
 
ON THE GRANT OF THE CHARTER OF 1816. 
 
 the profits of banks cannot fairly be measured by the amount of their notes 
 in circulation. The same statement furnishes still more decisive evidence. 
 While the Bank of Columbia has lent to Government and to individuals much 
 more than twice the amount of their capital, to wit: about one million nine 
 hundred thousand dollars, it has in circulation only three hundred thirty-six 
 thousand eight hundred, or about one sixth of the amount of its loans. Where- 
 as, the Union Bank (for instance) has lent to Government and individuals, 
 much less than twice the amount of its capital, to wit: only seven hundred 
 and thirty-six thousand nine hundred dollars, and has in circulation more 
 than four hundred and twenty-seven thousand dollars, largely upwards of one 
 half the amount ofats loans; from which it is evident, that the Bank of Colum- 
 bia, whilst it has the smallest amount in circulation, has proportionably the 
 largest capital at interest, and is, of course, making the largest profit. 
 
 These statements are furnished, not as affording a test of the comparative 
 merits of these institutions, but merely to establish what I think they une- 
 quivocally prove, that the profits of banks bear no direct ratio to the amount 
 of their notes in circulation, and that it is not fair to conclude that the United 
 States' Bank will injure the State banks generally, by reducing the amount 
 of their circulating paper. 
 
 I must not, however, be understood to contend that the establishment of 
 the United States' Bank, if its effects are to re-establish the specie basis for 
 our circulation, will not reduce the profits of any of the banks. It doubtless 
 will, and ought to reduce the profits of those which have overdealt. Those 
 profits liuve been too large, just so far as the banks have been guilty of over- 
 dealing. They ought to be corrected, but it will be the resuming of the pay- 
 ment of specie through the operation of the United States' Bank, which will 
 correct them. If this bank were to go into operation on any other than a 
 specie basis, the issue of its notes would not affect the profits of the State 
 banks. It is not, then, the competition of their notes for the circulation, but 
 the necessity of specie payments, that will compel them to curtail their dis- 
 counts and reduce their profits. This is as it should be; the effect upon the 
 State banks will be wholesome and salutary. Whilst the profits of some are 
 reduced, those of others will be increased by the operation of a national bank 
 upon the national currency. Whilst some must curtail their business to meet 
 the demands of specie, others, which are now restrained because specie re- 
 demption is confined to themselves, will be once more enabled to enlarge their 
 business to its accustomed extent. Gentlemen from the Eastern States, I 
 should imagine, are, therefore, peculiarly interested in the measure, because it 
 is so eminently calculated to re-produce that equalization of profits among 
 the banks which has, for some time, been suspended, so much to their disad- 
 vantage. 
 
 It will be observed, that I have, throughout, proceeded upon the idea that 
 this bank is always to redeem its paper with specie. A specie basis is the only 
 true foundation of all banking. Any other will be found delusive and de- 
 structive. The committee, therefore, had taken a precaution which seemed 
 to have escaped the observation of the gentleman from Pennsylvania, (Mr. 
 SERGEANT.) That gentleman has asked what greater security we have for 
 the payment ot specie by this bank than by others? I answer, that it is a 
 condition of their charter! It is expressly provided by that charter, that they 
 shall not, at any time, suspend specie payments without authority to do so. 
 If they do, their charter is violated it is void. For my own part, as a mem- 
 ber of the committee who reported this bill, I was disposed 4 * to make assur- 
 ance doubly sure arid take a bond of fate," by an express provision, that the 
 charter should be void if they suspended specie payment. Professional gen- 
 tlemen, however, on the committee, and among others, if I mistake not, the 
 able gentleman from Pennsylvania, (Mr. HOPKINSON) believed such a clause 
 unimportant, because it was necessarily implied in the condition attached to 
 the charter by the provisions of the bill. It is then an essential part of the sys- 
 tem, that the bank should redeem its notes in specie. I would never give my 
 vote to any bank of another character. We have, then, in this bank, an as- 
 
646 BANK OF THE UNITED STATES. 
 
 surance of specie payment, not afforded by others, except, perhaps, by those 
 of the Eastern States. Of this much we are assured, that, as soon as it ceases 
 to be a specie bank, it ceases to exist, so that we are in no danger of encoun- 
 tering the evil which the gentleman appears to apprehend. 
 
 But, the same gentleman appears to suppose that the contemplated bank will 
 be enabled to pay specie, because the Bank of Pennsylvania, having its capi- 
 tal in specie and 'United States' stock, in equal proportions with those propos- 
 ed by mis bill, finds itself without the power of meeting its engagements. I 
 cannot admit the analogy contended for. Though the proportion of specie to 
 stock may be the same, yet the amount of specie capital in this bank will be 
 so much greater as to add to its capacity to keep its notes in circulation. But 
 this is not the only reason. The Bank of Pennsylania has already in circula- 
 tion a vast deal of paper, with only a small amount of specie in their vaults. 
 Were they to commence specie payments, their notes would return upon 
 them for payment, to the imminent danger of the bank, unless they should pre- 
 viously adopt the precautionary measures in their power. But the Bank of 
 the United States, when it goes into operation, will have its one million four 
 hundred thousand of spece, without a note in circulation. In issuing their 
 paper, they will be governed by circumstances, and should it return upon them 
 too rapidly for specie, they will, at once, lessen the quantity thrown into cir- 
 culation. There is, then, all the difference between the situation of the two 
 banks, that may reasonably be expected between two concerns, one of which 
 is just commencing business, while the other is deeply involved, and supposed 
 to be unable to meet the just demands of its creditors. Thus we see, that, 
 whilst the Bank of Pennsylvania is neither bound to pay specie by the condi- 
 tions of its charter, nor able, at once, to redeem its notes, the Bank of the 
 United States will be able and obliged to make gold and silver the basis of 
 its circulation. 
 
 Mr. TUCKER concluded his remarks by shortly recapitulating the grounds 
 which he had attempted to maintain. He had endeavored to show that a capi- 
 tal of thirty -five millions would readily find employment; that the proposed 
 bank would not still farther surcharge tne circulation, as had been contended; 
 that the establishment of the Bank of the United States would not injure the 
 State banks, though he admitted the resuming of specie payments would ne- 
 cessarily reduce the profits of some of them; and that this bank would be 
 bound by its charter, and enabled by its funds, to rest its circulation upon the 
 solid foundation of a specie basis. He hoped, therefore, the amendment pro- 
 posed would be rejected. 
 
 FEBRUARY 28th, 1816. 
 
 The House again resolved itself into a committee of the whole, Mr. NELSON, 
 of Virginia, in tne chair, on the bill the motion to reduce the capital, being 
 still under consideration. 
 
 Messrs. WEBSTER, HOPKINSON, SERGEANT, and PITKIN, advocated the mo- 
 tion, and Messrs. CUTHBERT, SHARP, and CALHOUN, opposed it. 
 
 Mr. WEBSTER first addressed the House. He regretted the manner in 
 which this debate had been commenced, on a detached feature of the bill, and 
 not a question affecting the principle; and expressed his fears that a week or 
 two would be lost in the discussion of this question, to no purpose, inasmuch 
 as it might ultimately end in the rejection of the bill. He proceeded to reply 
 to the arguments of the advocates of the bill. It was a mistaken idea, he said, 
 which he had heard uttered on this subject, that we were about to reform the 
 national currency. No nation had a better currency, he said, than the United 
 States there was no nation which had guarded its currency with more care; 
 for the framers of the constitution, and those who enacted the early statutes 
 on this subject, were hard-money men; they had felt, and therefore duly ap- 
 preciated the evils of a paper medium; they, therefore, sedulously guarded 
 the currency of the United-States from debasement. The legal currency of 
 
ON THE GRANT OF THE CHARTER OF 181C. 647 
 
 the United States was gold and silver coin; this was a subject in regard to 
 which Congress had run into no folly. 
 
 What, then, he asked, was the present evil? Having a perfectly sound na- 
 tional currency, and the Government having no power in fact to make any- 
 thing else current but gold and silver, there had grown up in different States 
 a currency of paper issued by banks, setting out with the promise to pay gold 
 and silver, which they had been wholly unable to redeem: the consequence 
 was, that there was a mass of paper afloat, of perhaps fifty millions, which sus- 
 tained no immediate relation to the legal currency of the country a paper 
 which will not enable any man to pay money he owes to his neighbor, or his 
 debts to the Government. The banks had issued more money than they could 
 redeem, and the evil was severely felt, &c. Mr. W. declined occupying the 
 time of the House to prove that there was a depreciation of the paper in cir- 
 culation: the legal standard of value was gold and silver: the relation of paper 
 to it proved its state, and the rate of its depreciation. Gold and silver cur- 
 rency, he said, was the law of the land at home, and the law of the world 
 abroad; there could, in the present state of the world, be no other currency. 
 In consequence of the immense paper issues haying banished specie from cir- 
 culation, the Government had been obliged, in direct violation of existing 
 statutes, to receive the amount of their taxes in something which was not re- 
 cognized by law as the money of. the country, and which was, in fact, 
 greatly depreciated, &c. This was the evil. 
 
 As to the conduct of the banks, Mr. W. said he would not examine whether 
 the great advances they had made to the Government, during the war, were 
 right or wrong in them, or whether it was right or \vn>ii in the Government 
 to accept them: but, since the peace, he contended, their conduct had been 
 wholly unjustifiable, as also had that of the treasury in relation to them. It 
 had been supposed the banks would have immediately sold out the stocks, 
 with which they had no business, and Have fulfilled their engagements; but 
 public expectation had in this respect been disappointed. When this happen- 
 ed, Mr. W. continued, the Government ought, by the use of the means in its 
 power, to have compelled the banks to return to their specie payments. In 
 nis opinion, Mr. W. said, any remedy now to be applied to this evil, must be 
 applied to the depreciated mass of paper itself; it must be some measure which 
 would give heat and life to this mortified mass of the body politic. The evil 
 was not to be remedied by introducing a new paper circulation; there could 
 be no such thing, he showed by a variety of illustrations, as two media in cir- 
 culation, the one credited and the other discredited. All bank paper, he ar- 
 gued, derives its credit solely from its relation to gold and silver; arid there 
 was no remedy for the state of depreciation of the paper currency but the 
 resumption oi specie payments. If all the property of the United States was 
 pledged for the redemption of these tiity millions of paper, it would not there- 
 by be brought up to par; or, if it did, that would happen which had never yet 
 happened in any other country. An issue of treasury notes, he added, would 
 have no better effect than the establishment of a new bank paper. He illus- 
 trated this general position by referring to a period anterior to the time of the 
 reformation of the coin of England, when the existing coin had been much de- 
 based by clipping, &.c. which had created much alarm. An attempt had been 
 made to correct the currency' thus vitiated, by throwing a quantity of sound 
 coin into circulation with the debased; the result was, that the sound coin 
 disappeared, was hoarded up, because more valuable than that of the same 
 nominal value which was in general circulation, &c. 
 
 The establishment of a national bank not being in his opinion the proper 
 remedy, he proceeded to exame what was. The solvency of the banks was not 
 questioned: there could be no doubt, he said, if the banks would unite in the 
 object, they might in three weeks resume the payment of specie, and render 
 the adoption of any measure by this House wholly unnecessary. The banks, 
 he said, were making extravagant profits out of the present state of things, 
 which ought to be curtailed. He referred, for illustration of this point, to the 
 state of the Bank of Pennsylvania, as exhibited in the return to the Legisla- 
 
648 BANK OF THE UNITED STATES. 
 
 ture of that State, which, with a capital of 2,500,000 dollars, had done a dis- 
 count business of 4,133,000 dollars, at the same time that it held 1,811,000 
 dollars of the United States stock so that, without taking into account a 
 mass of treasury notes, real estate, &c. that bank was receiving interest on 
 six and a half millions, nearly three times the amount of its capital. This he 
 considered an extraordinary fact. That bank had been pronounced by the 
 Legislature to be in " a flourishing state"; it was so to the stockholders in 
 the bank, he doubted not; but how was it to those who were affected by the 
 depreciation of it to the man who comes into an office for life, and relin- 
 quishes all his prospects and profits for a fixed salary, not to be diminished 
 during his continuance in office,* to the poor pensioner, whose wounds, received 
 in his country's service, are yet bleeding? 
 
 These banks not emanating from Congress, what engine were Congress to 
 use for remedying the existing evil? Their only legitimate power, he said, 
 was to interdict the paper ot such banks as do not pay specie, from being re- 
 ceived at the custom house. With a receipt of forty millions a year, Mr. W. 
 said, if the Government was faithful to itself and to the interests of the peo- 
 ple, they could control the evil; it was their duty to make the effort. They 
 should have made it long ago, and they ought now to make it. The evil 
 grows every day worse by indulgence. If Congress did not now make a stand, 
 and stop the current whilst they might, would they, when the current grew 
 stronger and stronger, hereafter do it? If this Congress should adjourn with- 
 out attempting a remedy, he said, it would desert its duty. 
 
 If this bank were calculated to do good at all, Mr. W. contended it was 
 only as an agent of the revenue officers of the Government. As a bank esta- 
 blished for ordinary banking purposes, what would be its operation? If this 
 were to be a specie bank, it would go into operation at Philadelphia; would 
 promise but little, but would perform all its promises: independent of its con- 
 nexion with the Government, it would not be able to get its notes into circu- 
 lation nobody would borrow of it; it would operate merely as a bank of de- 
 posite. All its transactions would be confined to the negotiation of paper for 
 merchants, to enable them to anticipate for a short time so much of their in- 
 come as was necessary to pay their bonds for duties on importations; and so 
 far, but no farther, it would have a positive good operation. But, as a mea- 
 sure to supply a remedy for the disorders of our currency, Mr. W. argued 
 this bank would be of no efficacy; because, if he were not mistaken in his 
 views, its bills would have but a very limited circulation. 
 
 As to the evil of the present state of things, Mr. W. admitted it in its ful- 
 lest extent. If he was not mistaken, there were some millions in the treasury, 
 ot paper, which were nearly worthless and were now wholly useless to the 
 Government, by which an actual loss of considerable amount must certainly 
 be sustained by the treasury. This was an evil which, he said, ought to be 
 met at once; because it would grow greater by indulgence. In the end, the 
 taxes must be paid in the legal money of the country; and the sooner that 
 was brought about the better. Such was the operation of the present state of 
 the circulating medium, he proceeded to show, that the duties laid by the 
 United States were at a rate of ten per cent, higher in Boston than in Balti- 
 more, and in Baltimore higher than in Washington, &c. If Congress were to 
 pass forty statutes on the subject, he said, they would not make the law more 
 conclusive than it now was, that nothing should be received in payment of 
 duties to the Government but specie; and yet, no regard was paid to the im- 
 perative injunctions of the law in this respect. The whole strength of the 
 Government, he was of opinion, ought to be put forth to compel the payment 
 of the duties and taxes to the Government in the legal currency of the country. 
 
 In regard to the plan of this proposed bank, Mr. W. said he would consent 
 to no bank which, to all intents and purposes, was not a specie bank; arid in 
 that view he was in favor of the proposed amendment. He expressed some 
 alarm at the stock feature of the bank; which would enable and might induce 
 the existing bank corporations to come forward and take up the whole stock 
 of this national bank. He should be glad to see a bank established, he ob- 
 
ON TIIK (.KANT OF THF, CMARTKK OF 1816. 649 
 
 served, in the course of his remarks on this point, which would command the 
 solid capital of the country. There were men, he said, of wealth and stand- 
 ing, who would embark their funds in a bank constituted on commercial specie, 
 principles, but who would not associate in such an institution with the stock- 
 holders in the country, any more than a good currency would associate with 
 a bad one. A national bank, he said, ought to be regarded, not as the power 
 to rectify the present state of (he currency, but as a means to aid the Govern- 
 ment in the exercise of its power in tins respect. lie concluded his remarks 
 by saying that the power ot the Government must be exercised in some way, 
 and that speedily, or evils would result, the extent of which he would not at- 
 tempt to describe. 
 
 Mr. CUTHHERT followed, in opposition to the proposed amendment; though 
 
 contrary effect, thus: That, to be/;om', and remain a specie bank, the institu- 
 tion must be slow in its operations, and the directors and stockholders be. 
 content with small sains on their capital: that the interest they would draw, 
 of six per cent, on the stock part of their capita!, would aid them in this 
 <:ours i , and induce them to be satisfied with less gains in the way of dis- 
 counts, <$cc. In opposition to the proposal to reduce tin* capital of tli : - Lank, 
 he took, for his ground work, two facts, which would not be questioned: tirst, 
 that this is a growing nation, in population, resources, wealth, and comm 
 
 ;dly, that there is, from the natuiv of things, an absolute uncertainty as 
 to the quantity of capital which may be required, und the extent of tin; busi- 
 ness which may be done by a national bank. He argued, from these posi- 
 rirns, that the bank ought to have the power of contracting or expanding itself 
 to the wants of the country: and. if (he business of the country required the 
 use ol'a larger amount of discounts than would be made on twenty millions, 
 that the operations of the bank ought not to be cramped. In this nation, 
 growing in population, enterprise, and wealth, where all those uses of society, 
 which require active capital and a general circulating medium, were every 
 day rapidly multiplying and extending, he would not place narrow limits on 
 the useful agency of this bank lie compared such a course, to placing a la-'- 
 of iron on the swelling muscles and growing energies of a vigorous youth. 
 It was much better, he concluded, to have a capital larger than necessary, 
 than one much too small. Mr. ('. n-xt proceeded to examine the utility ot a 
 national bank, as compared with the State banks, in promoting exchanges, 
 remittances, and transfer?, by Government and individuals, lie stated their 
 various operations, in a plain and intelligible manner: and from his facts on 
 this subject, drew the conclusion, that a national bank, only, could effica- 
 ciously promote the exchange of moneys and commodities that internal com- 
 merce, which serves to knit together and fertilize every section of the country. 
 A national bank he compared to the ocean of commerce, which bears on its 
 bosom the freights of all regions from one to the other: the, State banks to the 
 rivers, which are the channel of communication within their particular limited 
 sphere. In reply to the argument, that the evil of the redundancy aiu. de- 
 preciation of the present paper circulation, would not be corrected by throw- 
 ing other paper into circulation, he said that the national bank, instead of 
 increasing the quantum of paper, would substitute other paper in lieu of a 
 portion of that now- in circulation, and, by this operation, the remainder would 
 be brought to a specie value. A further argument he urged in favor of a large 
 capital, was this: that a bank of twenty millions would issue as mnch paper 
 as a bank of thirty-five million.-, as the issue would be limited by the demands 
 of society: but, with a large capital, there would be greater security to indi- 
 viduals/ The difference, between the two capitals, would be the difference 
 between two merchants carrying on the same commercial speculations, tin- 
 one with a large, the oilier with a small capital: the creditors of the first 
 82 
 
650 BANK OF THE UNITED STATES 
 
 having, undoubtedly, better security than those of the last, &c. On these 
 and other grounds, Mr. C. opposed the amendment. 
 
 Mr. HOPKINSON took the other side of the question. He had come to Con- 
 
 fress, lie said, with a decided impression in favor of a national bank ; not that 
 e believed its agency indispensable in reproducing specie payments, but, be- 
 cause he believed it would be useful in this respect, and always had believed 
 that a national bank was an useful agent in managing the financial concerns 
 of the Government. With these views, he said, he had hoped to have seen a 
 scheme of a bank proposed to this House for consideration, requiring little or 
 no discussion. Referring to the voluminous discussions, at preceding ses- 
 sions, on this subject, and to the various plans of a bank presented, examin- 
 ed, and dismissed, he had hoped that gentlemen, laying aside their visionary 
 theories, would have resorted to the test of experience, and established a 
 bank according to its lessons. Tn this remark Mr. H. hsd reference to the 
 late Bank of the United States, to the management and winding up of which, 
 he paid a high compliment. He was sorry, he said, to find the plan now pro- 
 posed was so different from that simple character he approved, as to deter- 
 mine him not to give it even his feeble support. He cautioned the House not 
 to be too hasty in acting on this subject; to weigh it well, and coolly consider 
 it. We all feel the present evil, said he: and a state of suffering is not favor- 
 able to deliberation. He warned the House not inconsiderately to adopt 
 this expedient, lest they should act like an unfortunate debtor, who plunges 
 on in expedient after expedient, all under pretence and hope of a remedy, 
 until he is involved in irretrievable ruin; when, if he had acted with a patient 
 prudence, leaving something to time, and much to caution, he might have 
 overcome his difficulties. The late war, Mr. H. said, (in speaking of the 
 present state of the currency) had been a tremendous shock to all the institu- 
 tions of the country, which had suffered in all its interests, and in none more 
 than in its financial concerns. Could it, he asked, have been reasonably ex- 
 pected, as had been suggested, that, on the return of peace, the evil, in this 
 respect, would have been immediately remedied? No, he said; great evils 
 require a slow remedy. In this young nation, and with its vast resources and 
 solid wealth, the remedies would come of themselves, in a great degree, if we 
 have patience to wait a little for them: at least, he said, let us not, by our 
 rashness, destroy all hope of remedying the evil. After other general remarks 
 of this character, Mr. H. then proceeded to discuss the question immediately 
 before the House. 
 
 He was in favor of a reduction of the capital, though there were in the sys- 
 tem other features much more exceptionable to him than the amount of the 
 capital; if the motion to reduce the capital, therefore, succeeded, he wished 
 it to be considered that he should not feel himself thereby pledged to accept 
 the bill. Mr. H. urged many arguments against a large amount of capital, 
 treating as wholly ideal the notion of a bank of thirty- five millions of capital 
 confining its operations to seven, eight, ten, or twenty millions, as the wants 
 of the country might require; the bank, he said, must do a business in propor- 
 tion to its capital, and such a business it would always do as to secure it a 
 competent dividend on its whole capital. Mr. H. said he was not one of 
 those who advocated a bank beyond the principle of its being a means of aid- 
 ing the Government in its fiscal administration. He advocated not such an 
 institution as an engine of Government: in that shape, he said, they should 
 get beyond the powers of Congress to establish a bank. He, therefore, 
 argued, that the Government ought to have no concern in the stock of this 
 bank; nor, beyond what the value of its custom or business gave it, ought the 
 Government to have any control over the bank. There might be occasions 
 when, and reasons why, a Government should put stock into a bank; but, as 
 an engine of power and profit, the Government ought to have nothing to do 
 with it. Mr. H. then examined the arguments in favor of the proposed amount 
 of capital of the bank, and replied to them, contending that the argument, of 
 increased demand for bank capital, was wholly fallacious, because it put out 
 
ON THE GRANT OF THE CHARTER OF 1816. 
 
 of view the multiplication of private banks within a few years past; and illus- 
 trating his views on this head by reference to the history of banking in Eu- 
 rope. By every test to which he could resort, the amount even ot twenty 
 millions was much too large. There was great danger, he then argued, in es- 
 tablishing an institution of this kind no such engine could be created, much 
 less of this enormous magnitude, without danger as the most beneficial 
 agents, ill applied, become dangerous and destructive, &.c. He defended the 
 State banks from imputations cast on them, and contended that they had 
 great claims on the attention and respect of even the General Government, 
 from their extensive and beneficial influence. Every injury to them, so rami- 
 fied were they into all the relations of society, must be a deep injury to the 
 general interest; and their interests ought, therefore, to be duly regarded. 
 He excepted from this encomium the litter of banks lately created in Penn- 
 sylvania, which he considered the offspring of private speculation and legis- 
 lative fraud, in defiance of the wise interposition of the constitutional power 
 of the Governor of that State against them. If the State banks in our cities 
 had yielded to the threats and seductions of the Government, and, in a de- 
 gree, to public sentiment, in making loans to the Government more extensive 
 than prudent, it ought to be here no ground of accusation against them; every 
 engine, he said, had been put in motion to influence them; even the Secretary 
 of the Treasury had, in person, implored their agency in relieving the trea- 
 sury from its difficulties. Mr. H., in the course of his argument, denied that 
 the excessive issues had been the cause of the stoppage of specie payments; 
 there had been no such excessive issues, as represented: nor, as far as regard- 
 ed the banks at Philadelphia, at least, was there, at thi^ moment, an exces- 
 sive issue of paper. Referring to the state of those banks, as reported to the 
 State Legislature, lie said, some of them have not paper in circulation to the 
 amount of one-third of their capital: and this was not as far as they might 
 fairly go. The depreciation was not owing, he also argued, to the scarcity of 
 specie in the country: there was enough specie in the country for the ordinary 
 bank transactions, on the existing bank capital, and to do a specie business, ^too, 
 Why, then, he then proceeded to examine, do not the banks pay specie? The 
 caustii)f suspension of payment in specie, he said, was not the excessive is- 
 sues of paper, or scarcity of specie, but that loss of public confidence which 
 attends, at all times, public calamity and danger those periods of gloom and 
 dismay in which all men are disposed to obtain, in lieu of paper, what will be 
 of value to them in any and every state of things, c. Had the banks ot 
 Philadelphia continued their vault's open four and twenty hours longer than 
 they had done, there would not, probably, have been a doit in them; in one 
 day, it was said, that one bank in that city had distributed, in specie, for which 
 a general run was made on it, three hundred thousand dollars. The banks 
 had been compelled to close their vaults. In this course, he showed, by va- 
 rious facts and arguments, they had been supported by public opinion. To 
 resume payments in specie, he said, was a work of time and caution. To 
 enable them to do it, the public stock the banks hold must be sold, but gra- 
 dually sold, or it cannot be sold without a heavy loss. The banks, he said, 
 were no\y, and for some time had been, taking measures with due prudence 
 and caution, for a resumption of specie payments. It was a strong reason, he 
 concluded his argumentative speech by saying, with him, against this bank, 
 that it would, according to the showing of its advocates, operate coercively, 
 and, of course, injuriously, on the State banks. 
 
 Mr. SHARP next addressed the Chair on this subject, expressing, in the out- 
 set, his regret that the attack on this bank had been on its details, instead of 
 its principle. Mr. S. explained his views of the difference between the as- 
 pect of this question at this time, and that which it presented at the last 
 winter, when it had been so long fruitlessly agitated. The principal object of 
 the advocates of a national bank, at the last session, was to afford to the Go- 
 vernment the facility of obtaining occasional loans to carry on the operations 
 of the Government, &c. and to sustain the public credit; the object at present 
 
G5t? BANK OF THE UNITED STATES. 
 
 was of a different character to remedy the evil of a vitiated currency, which 
 had lately been much exaggerated, and which demanded a remedy. Mr. S. 
 here examined the operation of this depreciation on the revenues of Govern- 
 ment, Which, he clearly showed, were most injuriously affected by it. The 
 Government sustained a clear loss of large amount a loss which must be 
 made up by (axes levied on the industry and labor of the community; and 
 who gained by it? Those whose duty it is to remedy the evil; it is the own- 
 ers of bank stock who derive the benefit from the depreciation of their own 
 paper. All acknowledged the extent of the evil, and the necessity of a reme- 
 dy, though they differed as to the nature of the remedy. 
 
 In reply to the argument of Mr. WEBSTER, that the remedy for the evil was 
 in the power of the Secretary of the Treasury, by requiring payment of the 
 dues to Government in specie, Mr. S. said the'gentleman had not demon- 
 strated that there-was specie enough in the country for the purposes of Ihe 
 payment of the revenue to the treasury, nor that the banks have not the means, 
 ultimately, to force the treasury to take their paper in payments to the Go- 
 vernment. The disposition was not wanting in the officer at the head of 
 that Department, to apply the remedy, if it were in his power; but, Mr. S. 
 said, an act of Congress only could apply an adequate remedy. If that now 
 proposed was the proper measure, let it be adopted; if a better can be pro 
 posed, let it be shown- He was not, he added, so opiniated as to assert that 
 this was the only remedy; but a national bank was a measure tried and un- 
 derstood, and he, therefore, preferred it if it should not succeed, he would 
 support any other measure adequate to the object in view. 
 
 In reply to Mr. HOPKIXSOX'S reference to the old Bank of the United 
 States-, as an institution whose wisdom had been tested by experience, Mr. 
 S. said he could not see the force of the wide distinction the gentleman had 
 drawn, between the plan of that bank and of this. He compared these fea- 
 tures, and showed that their dissimilarity was not such as to change their 
 principle. This, he said, was intended to be a specie bank, gradually put in 
 operation, and by it, business connected with the measures of the Govern- 
 ment, to introduce a general resumption of specie payments and circulation. 
 In regard to the State banking institutions, Mr. S. avowed as strong an attach- 
 ment to their interest and prosperity, as the gentleman from Pennsylvania: 
 but his attachment to them as individuals, must be regulated by the correct- 
 ness of their conduct. If they abandoned the path ot probity and duty, he 
 must renounce his attachment to them, unless they showed a disposition to re- 
 return to it. In regard to the means alleged to have been employed to obtain 
 loans from these banks, when they yielded to the solicitations of the treasury, 
 Mr. S. said they took care to get the best bargain they could out of its neces- 
 sities; in addition to the just interest of six per cent, they got a premium of 
 somewhere about twenty per cent, for their friendly loans to the Government. 
 To prove that they had made a good business of it, he said that there was not 
 one of those banks but could sell out its stock for specie, and make a hand- 
 some profit on the whole transaction, besides the advantages they have already 
 derived; but, he said, they did not want to do it they had rather keep then- 
 stock, bearing interest, and issue paper on it, &c. 
 
 As to the idea of danger to the Government from a bank of thirty-five mil- 
 lions, he said it was fanciful. How far could a bank be dangerous to the Go- 
 vernment? When banking was a monopoly in the hands ot a Government, or 
 of a few individuals; and then only. Competition, he said, destroyed mono- 
 poly, and destroyed the danger from such an institution; and it could not be 
 argued that there was not now competition enough to deprive such an institu- 
 tion as this of the character of an engine dangerous to the liberties of the coun- 
 try. A bank, he said, might be more profitable to the stockholders with a 
 capital of twenty millions; but it would be more useful to the community with 
 a larger capital, &c- Having offered these and other views of the subject, he 
 concluded by expressing his hope that this bill would pass with very little 
 alteration of its present provisions. 
 
ON THE GRANT OF THE CHARTER OF 1816. 
 
 Mr. CALHOUX then rose, and, in an energetic manner, vindicated the bill, 
 and his views of it, from the attack which had been made on thetn. He said 
 no man in the House would reprobate, more than he, the establishment of a 
 bank which was not a specie bank. A bank not to pav specie, he said, would 
 be an instrument of deception; it would have no character or feature of a 
 bank he should regard it with disgust and abhorrence. This bank, he as- 
 serted, in reply to contrary assertions, if established, would be a specie bank. 
 He professed himself ready to remedy any defects which should be pointed 
 out; but he hoped the committee would not be influenced to destroy its essen- 
 tial features by such vague arguments as had been urged against them. This 
 was to be a specie bank, or he would have nothing to do with it. He called 
 upon gentlemen not to give way to objections to the details of the bill, made 
 by those who were altogether inimical to the establishment of any bank; their 
 arguments, he intimated, ought to be received with suspicion, because their 
 views of the subject might be supposed to be warped by their hostility to the 
 project altogether. Mr. C. then spoke at length in explanation and reply to 
 those gentlemen who had preceded him in debate. In regard to the estima- 
 tion of paper in circulation, c. he took occasion to say, that he and General 
 SMITH had not widely differed in opinion on that head, when they came to 
 understand terms. Mr. C. said he had not specified the particular items in 
 his estimate of the amount of bank issues and transactions his object had been 
 merely to show, without descending to particulars, that the banks had over- 
 traded. He referred, for illustration, to the Hank of Washington, reputed a 
 prudent bank, which, on a capital of 350,000 dollars, \\hat with stock and dis- 
 counts to individuals, drew interest on 800,000 dollars. His object, he said, 
 when up before, was to prove that the banks generally, had done a business 
 which would authorize them to divide at the enormous rate of fourteen and a 
 half per cent, on their capital paid in. &c. 
 
 Mr. SERGEANT spoke at some length, in explanation of his views. 
 
 Mr. PIIKIN followed, in support of the motion to reduce the capital of the 
 bank, declaring himself decidedly friendly to the incorporation of a bank of 
 something like moderate capital, on true commercial and practical principles, 
 but on no other.* 
 
 The question was then taken on the motion to reduce the capital to twenty 
 millions, and decided in the negative, as follows: For the motion, 49. 
 Against it, 74. 
 
 And the committee then rose. 
 
 On the 29th of February ,^1816, the House having resolved itself into a com- 
 mittee of the whole, Mr. NELSON, of Va. in the chair, 
 
 On motion of Mr. CADV, with the assent of Mr. CALHOUN, the bill was 
 amended, by striking out so much of the bill as gives to Congress the privi- 
 lege, hereafter, of extending the capital of the bank from thirty Jive to fifty 
 millions. 
 
 Mr. CADY moved to strike out so much of the bill as authorizes the Govern- 
 ment to subscribe a certain proportion (seven millions) of the stock. 
 
 The motion was opposed by Mr. CALHOUN and Mr. SMITH, of Maryland, 
 and supported by Mr. RANDOLPH, Mr. CADY, and Mr. WARD, of Mass. 
 
 The following is a sketch of the debase that ensued on this motion: 
 
 Mr. CADY having moved to amend the bill by striking out so much thereof 
 as authorizes a subscription by the Government of seven millions to the capi- 
 
 * The Reporter regrets that his necessary absence from the hall at the time Mr. P. 
 spoke, prevents him from presenting- even the substance of his argument, Nat. Int. 
 
654 BANK OF THE UNITED STATES. 
 
 tal stock of the bank, supported his motion by a number of observations. He 
 contended that no advantage would accrue to the United States from the 
 possession of this interest in the bank. The money to pay for this stock, he 
 said, would cost the United States more than any profit they could derive 
 from it, (that is, by the expense attending its collection, all the funds of the 
 Government accruing sooner or later from taxation on the People) and would, 
 besides, render necessary the imposition of additional taxes to meet it. It 
 would be like an individual's taking up money at eighteen per cent, (which he 
 estimated as the cost of collection, &c.) to put into this bank. The seven mil- 
 lions of money, he added, would contribute more to the wealth and improve- 
 ment of the country, would produce in the end a better interest to the United 
 States, by suffering it to remain in the hands of the people, than it could pos- 
 sibly do by being invested in the stock of this bank. But it had been inti- 
 mated that a stock might be created, bearing five or six per cent, interest, for 
 the purpose of paying the proportion of the United States' subscription to the 
 bank, the bank interest on which would redeem it in time. Though this idea 
 was plausible, Mr. C. argued it was not solid; the United States must ulti- 
 mately pay the stock; and, as to the income of profit to the Government from 
 the bank, it would be much more simple to compel it to pay such a sum annu- 
 ally to the treasury, without the circuitous process of taking stock in if, &c. 
 He suggested other modes by which the bank could be made to contribute to 
 the general wealth, without the Government's becoming a stockholder, &c. 
 
 Mr. CALHOUN opposed the motion, so decidedly, that he said he should con- 
 sider the success of it as tantamount to a decision to strike out the first sec- 
 tion of the bill. He showed, by his statement of the operation of vesting this 
 stock in the bank, (which by the bill is to be done in certain annual propor- 
 tions) that there would be a clear gain to the Government of at least two per 
 cent, per annum, being the difference between the interest the Government 
 pays on the stock, and the interest it would receive on its bank shares. 
 
 Mr. RANDOLPH supported the motion, and availed himself of the occasion 
 of his rising, to enter largely into the subject, in a speech of considerable 
 length. His general views follow. He said he should vote for this motion, 
 because one of his chief objections (one of them, he repeated) was the concern 
 which it was proposed to give to the United States in the bank. He referred 
 to the sale, by the Secretary of the Treasury, some years ago, of the shares be- 
 longing to the Bank of the United States, and stated the reasons of his ap- 
 proving that step: but, he added, that it was a strong argument against the 
 feature of the bank bill now under discussion, that, whenever there should be 
 in this country a necessitous and profligate administration of the Government, 
 that bank stock would be laid hold of by the first Squanderfield at the head of 
 the treasury, as the means of filling its empty coffers. But, if there was no 
 objection to this feature stronger than that it would afford provision for the 
 first rainy day, it might not be considered so very important. He argued, 
 however, that it was eternally true, that nothing but the precious metals, or 
 paper bottomed on them, could answer as the currency of any nation or any 
 age, notwithstanding the fanciful theories that great payments could only be 
 made by credits and paper. How, he asked on this point, were the mighty 
 armies of the ancient world paid off? Certainly not in paper or bank credits. 
 He expressed his fears, lest gentlemen had got some of their ideas on these 
 subjects from the wretched pamphlets under which the British and American 
 
 Eress had groaned, on the subject of a circulating medium. He said he had 
 imself once turned projector, and sketched the plan of a bank, of which it 
 was a feature that the Government should have a concern in it; but he be- 
 came convinced of the fallacy of his views he found his project would not 
 answer. His objections to the agency of the Government in a bank was, 
 therefore, he said, of no recent date, but one long formed the objection was 
 vital; that it would be an engine of irresistible power, in the hands of any ad- 
 ministration; that it would be, in politics and finance, what the celebrated 
 
ON THE GRANT OF THE CHARTER OF 1816. 55 
 
 proposition of Archimedes was in phvsics a place, the fulcrum; from which, 
 at the will of the Executive, the whole nation could be hurled to destruction, 
 or managed in any way, at his will and discretion. 
 
 This bill, in the view of Mr. R., presented two distinct questions: the one 
 frigidly and rigorously a mere matter of calculation; the other, involving some 
 very important political consderations. In regard to the present depreciation 
 of paper, he did not appear to agree with those who thought the establishment 
 of a national bank would not aid in the reformation of it. If he were to go 
 into the causes which produced the present state of things, he said , he should 
 never end. As to the share the banks themselves had in producing it, he re- 
 garded the dividends they had made, since its commencement, as conclusive 
 proof. The present time, Mr. R. went on to remark, was, in his view, one 
 of the most disastrous he had ever witnessed in the republic, and this bill 
 proved it. The proposal to establish this great bank, he described as a crutch, 
 and, as far as he understood it, it was a broken one: it would tend, instead of 
 remedying the evil, to aggravate it. The evil of the times, ho said, was a spi- 
 rit engendered in this republic, fatal to republican principles fatal to 
 republican virtue; a spirit to live by any means but those of honest in- 
 dustry; a spirit of prolusion: in other words, the spirit of Catiline \\\m- 
 sdfaKeni avidus xiti profusus ;i spirit of expediency, not only in pub- 
 lic, but in private life: the system of Diddler i.i the farce living any 
 way and well: wearing an expensive rout, and drinking the finest wines, 
 at any body's expense. This bank, he imagined, (he was far from as- 
 cribing to the gentleman from South Carolina any such views) was, to a cer- 
 tain extent, a modification of the same system. Connected, as it was to be, 
 with the Go\ eminent, whenever it went into operation, a scene would be 
 exhibited on the great theatre of the United States, at the contemplation of 
 which he shuddered. If we mean to transmit our institutions, unimpaired, 
 to posterity; if some, now Ihing, wish to continue to live under the same in- 
 stitutions by which they are now ruled and with all its evils, real or imagi- 
 nary, he presumed no man would question that we live under the easiest Go- 
 vernment on the globe we must put bounds to the spirit which seeks wealth 
 by every path but the plain arid regular path of honest industry and honest 
 fame. This was one of the grounds on which he was hostile to this bill. 
 
 Alluding to Mr. WEBSTER'S observation respecting the laws fixing the cur- 
 rency of the United States, he said it was very true they were clear and pe- 
 remptory in their provisions; if the existing laws did not compel men to pay 
 their debts, the establishment of a bank would not. Let us not disguise the fact, 
 said he, pursuing his remarks on what'he had described as the evil of the times; 
 we think we are living in the better times of the republic: we deceive our- 
 selveswe are almost ^in the days of Sylla and Marius: yes, we have almost 
 got down to the time of Jugurtha. It was unpleasant, he said, to put one's 
 self in array against a great leading interest in a community, be they a knot 
 of land speculators, paper-jobbers, or what not; but, he said, every man you 
 meet, in this House or out of it, with some rare exceptions, which only served 
 to prove the rule, was either a stockholder, president, cashier, clerk, or door- 
 keeper, runner, engraver, paper maker, or mechanic, in some way or other, 
 to a bank. The gentleman from Pennsylvania, he said, might dismiss his 
 fears for the State banks, with their one hundred and seventy millions of pa- 
 per, on eighty-two millions of capital. However great the evil of their con- 
 duct might be, he asked, in the course of hisjllustrations, who was to bell the 
 cat? who was to take the bull by the horns? You might as well attack Gi 
 braltar with a pocket pistol, as to attemptto punish them. There were very 
 few, he said, who dared to speak tiutn to this mammoth; the banks were 
 so linked together with the business of the world, that there were very few- 
 men exempt from their influence. The true secret is, said he, the banks arc 
 creditors as well as debtors; and if we were merely debtors to them for the 
 paper in our pockets, they would soon, like Morris and Nicholson, go to jail 
 (figuratively speaking) for having issued more paper than they were able to 
 pay when presented to them. A man had their note, he said, for fifty dollars, 
 
656 BANK OF THE UNITED STATES. 
 
 perhaps, in his pocket, for which he wants fifty Spanish milled dollars; but 
 they have his note for live thousand in their possession, and laugh at his de- 
 mand. We are tied hand and foot, Mr. R. said, and bound to conciliate this 
 great mammoth, which is set up to worship in this Christian land: we are 
 bound to propitiate it, &c. Thus, he said, whilst our Government denounces 
 hierarchy; will permit no privileged order for conducting the service of the 
 only true God; whilst it denounces nobility, &c. has a privileged order of new 
 men grown up, the pressure of whose foot he, at this moment, felt on his neck. 
 If any thing could reconcile him to this monstrous alliance between the bank 
 and the Government, he could, if the object could be attained, of compelling 
 these banks to fulfil their engagements, almost find in his heart to go with the 
 gentleman in voting for it. 
 
 Mr. R. proceeded to a minute examination of the state of the paper cur- 
 rency, and its various phases, recently and in earlier times. The stuff utter- 
 ed on all hands, and absolutely got by rote by the haberdasher's boys behind 
 the counters in the shops, that the paper now in circulation would buy any 
 thing you want as well as gold and silver, was answered, he said, by say- 
 ing, that you want to buy silver with it. He examined in detail the present 
 mode of banking, which, he said, goes to demoralise society; it was as much 
 swindling, to issue notes, with the intent not to pay, as it was burglary to break 
 open a house. If they were unable to pay, the banks were bankrupts; if able 
 to pay, and would not, they were fraudulent bankrupts, &c. But. he said, 
 a man might as well go to Constantinople to preach Christianity, as to get up 
 here and preach against banks. He despaired, he said, almost, of remedying 
 the evil they c!ause, when he saw so many men of respectability, directors, 
 stockholders, debtors of the banks. To pass this bill, he said, would be like get- 
 ting rid of the rats by setting fire to the house: whether any other remedy could 
 be devised, he did not now undertake to pronounce. The banks, he said, had 
 lost all shame, and exemplified a beautiful and very just observation of one 
 of the finest writers, that men, banded together in a common cause, will 
 collectively do that at which every individual of the combination would spurn. 
 This observation had been applied to the enormities committed and connived 
 at by the British East India company; and would equally apply to the mo- 
 dern system of banking, but still more to the spirit of party, &c. on which Mr. 
 R. digressed at some length. 
 
 He then resumed the consideration of the history of bank paper in this 
 country, and stated the fact that, not many years ago, the New England paper 
 had been at almost as great a discount here, as the paper of this part of the 
 country now was there; and that, even A New England, the notes of some of 
 the banks were not current within their own States, except at a discount. As 
 to establishing this bank to prevent a variation in the rate of exchange of bank 
 paper, he said, you might as well expect it to prevent the variations of the wind: 
 you might, said he, as well pass an act of Congress (for which, if it would be 
 of any effect, he should certainly vote) to prevent the northwest wind from 
 blowing in our teeth as we go from the House to our lodgings. After <i minute 
 discussion of the causes and dates of the difference of exchange in the paper 
 of various banks, Mr. R. concluded his remarks by pledging himself to agree 
 to any adequate means to cure the great evil, that were consistent with the 
 administration of the Government, in such a manner as to conduce to the hap- 
 piness of the people and the reformation of the public morals. 
 
 Mr. WARD defended the Massachusetts banking institutions from imputa- 
 tions, which he thought a part of Mr. R's remarks on the currency calculat- 
 ed to cast on their correct management. 
 
 Mr. SMITH, of Maryland, then rose, and addressed the House at considera- 
 ble length, in opposition to the motion before it, and iu reply to .Messrs. CADV, 
 RANDOLPH, and others. He explained, by ample illustrations, the preference 
 which a note of the national bank would have over the notes of other banks, mid 
 even over treasury notes bearing interest, and the manner in which it would 
 
ON THE GRANT OF THE CHARTER OF 1616. 557 
 
 guard itself from a run for specie, &c. by a combination of individuals, or other 
 banks. In regard to the direction and management of fiscal affairs, he said, 
 the late Secretary of the Treasury, (meaning Mr. GallatinJ who went into 
 that department with as many prejudices as any man could well entertain, 
 thought all was wrong there, and he was the very person to set all right. He 
 had examined the subject day and night, and, after all his examination, he had 
 not found a single iota of Mr. Hamilton's system which it was necessary to 
 alter, &c. By this anecdote, Mr. S. illustrated the advantage of practice over 
 theory. He made many remarks, to shew the operation which made treasury 
 notes generally more valuable than the notes of any bank not paying specie, 
 and less valuable than the notes of any bank which does pay specie; and he 
 said, if this were not to be a specie bank, he should not have been found in 
 favor of it. The depreciation of paper, he said, was not wholly owing to the 
 suspension of specie payments, as he proved by a reference to the difference 
 of exchange between Baltimore and New York., in both of which places spe- 
 ' paid by the banks, and yet the exchange was nine and a half per 
 (ent. against Baltimore, &c. This was owing to the balance of trade being 
 thrown against them during the war, the Chesapeake having been almost 
 wholly shut up, whilst Baltimore ve.-sels put into the port of New York, with 
 their cargoes and prizes, &c. He did not wish the Government to pay any 
 money into this bank, but stock to be created, &c. respecting which, he did 
 not know but he should move an amendment, anil also to expedite the pay- 
 ment of the specie portion of the subscription by individuals to the bank: for, 
 without three-fourths of the proposed amount of specie in its vaults, the bank 
 would not dan- t;t is-ue a note, &c. 
 
 Mr. CADY again spoke in support of his motion, arid in reply to the objec- 
 tions against it. \\hen he concluded, 
 Tin*, committee rose. 
 
 MARCH 1, 1816. 
 
 The House again resolved itself into a committee of the whole, Mr. NEL- 
 SON, of Virginia, in the chair, on the bill. The motion to strike out so much 
 of the first section as allows Government to subsribe for seventy thousand 
 
 .-hares ol the stock, being still under consideration. 
 
 Mr. WRIUHT opposed the amendment at some length. He was sorry to see 
 a plan which promised such great benefit to the country, in the present de- 
 ranged state of its currency, endangered by the present motion. If the mo- 
 lion prevailed, he should be compelled, he said, to vote against the bill, much 
 as he was in favor of establishing a bank. He wished to see the bank possess- 
 vd in part by the Government, and partly by the citizens, because the stock 
 of it would be extremely profitable. The Government ought to have an in- 
 terest in the bank, as they would thereby be informed of all the plans which 
 might be at any time entertained by the directors of so powerful an institu- 
 tion. He was not afraid, however, to trust our citizens, nor ought they to be 
 suspicious of the Government; and the participation of the Government could 
 not, he conceived, be productive of injury or mischief. Mr. W. adverted to 
 the assertion, that such an institution would realize the imagined lever of 
 Archimedes, with which the world might be moved. He wished it did possess 
 iliat mighty power, and it could be brought to bear on the rotten and corrupt 
 Governments ot Europe. We have, he said, given to that portion of the world 
 examples of liberty, of valor, on the sea and on the land, and he should be 
 glad if, by any power, we could crush the despotisms which oppress it, &c. 
 He said he was surprised at the objections, made by gentlemen from the East, 
 to establishing this bank on so large a proportion of the public stock, as the 
 effect would be to raise that stock immediately to par, &c. 
 
 Mr. JEWETT, in reply, said, the gentleman who has just sat down, had ex- 
 orcised the House in the outset, ario! had threatened it with voting against the 
 
 83 
 
658 BANK OF THE UNITED STATED 
 
 bill if it did not suit him. He would not follow the example of that gentle- 
 man; he would not go to Europe to put down Governments, to light flames, 
 and put out fires, but would state a few matters of fact. This question, he 
 said, affected the interest of every State and town in the country; it was of 
 great magnitude; it would either restore the credit of our currency, or make 
 it worse than it is already; and to illustrate his opinion on this important sub- 
 ject, he would state a case in point. Some ten or fifteen years ago, he said, 
 there was a certain State (Vermont) which had no bank; but there were banks 
 in adjoining States, which afforded much profit; and the people of the State 
 thought they might as well grow rich by banking as their neighbors. They 
 supposed, if the limited means and numbers of private banks could make mo- 
 ney, that the extended means of a State would make an institution still more 
 profitable; that it would drive out the paper of other banks, facilitate the ope- 
 rations of the State, &c., as had been argued in favor of the bank now propos- 
 ed. A State bank was accordingly established, on a small specie capital, and 
 naper to a large amount issued, which they thought would never be returned 
 for payment. What was the consequence? The paper of other banks, it was 
 true, disappeared, but it was because of the suspicion which attached to the 
 State paper. The machine, if it might be called so, went on badly; it was at- 
 tributed to bad management of its concerns; and attempts were made to re- 
 medy the defects, but in vain. The paper depreciated from six to ten, and 
 from ten to fifteen per cent.; and finally, by the juggle, the people of the State 
 lost how much he was not certain but a great amount he knew. So it 
 would be, he said, with the plan now contemplated, if not amended; and, if 
 the objections to it were not obviated, he should be compelled to vote against 
 the bill, although he was strongly in favor of a bank on proper principles. If 
 passed in its present shape, it would entail evils on the country which money 
 could not compensate, &c. 
 
 Mr. Ross advocated the motion to amend the bill. He did not believe, as 
 had been argued, that a participation in the bank would strengthen the arm of 
 the Government, or be very profitable. If, however, the arm of the Govern 
 ment was to be strengthened by weakening that of the citizens, and uniting 
 with a privileged aristocracy, he was decidedly opposed to it. He did not 
 wish the Government to become partners in such a privileged order. If the 
 reasons for retaining the principle in the bill were correct, he thought the pro- 
 portion allowed too small: if Government was to derive this great profit Irom 
 the participation, its share was not great enough. It had been said that the 
 influence of one bank (the Manhattan) could have prevented the election of 
 Mr. Jefferson to the presidency. If that bank had been under Executive con- 
 trol, he believed its power would have been exercised. This was a proof of 
 the danger of giving Government a great influence in such institutions. He 
 was opposed to the plan, chiefly from his objections to joining a moneyed aris 
 tocracy, and his fears that it might operate injuriously to the liberties of the 
 country, &c. 
 
 Mr. GOLDSBOROUGH made a few remarks on the motion. If the provision 
 was inserted as an apology for the appointment of the five directors by the Go- 
 vernment, then he was opposed to it; but, if it would be as profitable as was. 
 predicted, and would enable us to dispense with some of the existing internal 
 taxes, he should be glad to vote for it. A good bank. Mr. G. said, would be 
 very serviceable; and he should vote against the motion, because he could not 
 see that any harm would arise from the nation participating in a pecuniary es- 
 tablishment, &c. 
 
 The question was then taken on striking out the provision, and decided in 
 the negative, as follows: For the amendment, 38. Against it, 61. 
 
 The committee proceeded with the consideration of the rest of the bill. 
 
 t 
 
 After the adoption of some verbal amendments 
 
ON THE GRANT OF THE CHARTER OF 1816. 559 
 
 some to feel a delicacy in supporting it, from constitutional scruples, he thought 
 it better to fix the bank where there could be no objections on that score, and 
 where, also, its operations would be facilitated. Washington is the seat of 
 Government of the nation; and here, he said, it would be under the eye of the 
 Government, where there would be less danger from so great a moneyed aris 
 tocracy, and the national interests would be better guarded than at any other 
 place. Mr. W. said it was not his purpose to anticipate objections to his mo- 
 tion, but the principal one he knew to be, that a sufficient number of persons 
 could not be found at Washington, qualified for directors. The force of this 
 objection he denied in the extent to which it was urged. In the city and 
 neighboring country, he was convinced there could be found abundant talents 
 for managing the concerns of the bank. The people of this district, moreover, 
 deserved highly of the Government; they had, in time of need, done as much, 
 or more, in proportion to numbers, to aid the country, than any other section 
 of the Union. Mr. W. adverted to the source whence the bill originated, and 
 insinuated that much of the ground for recommending Philadelphia must be 
 attributed to the partiality of those who had named that city in the bill; and 
 concluded by saying, that the motive for fixing the old bank of the United 
 States at Philadelphia, was the same that ought now to place the present bank 
 here, to wit, that it is the seat of Government. 
 
 Mr. ROBERTSON said he coincided with the gentleman in some of his views. 
 He could see no strong reason for preferring Philadelphia; because, if the ob- 
 ject was to select a city on account of its commerce. Philadelphia was not the 
 most commercial place; and if that reason carried the bank from the seat of 
 Government, the same reason would prevent its being located at Philadelphia. 
 But Mr. R. said he had another reason for disapproving the place mentioned 
 in the bill he was unwilling to impose upon Philadelphia an institution so 
 obnoxious to the Representatives from that city, all of whom were so decid- 
 edly hostile to the bank. However, he said, he should not vote for the motion, 
 because, as a place of greater commerce, he preferred Philadelphia to Wash- 
 ington. 
 
 At the suggestion of Mr. CALHOTTX, who thought the motion had better be 
 offered in a subsequent stage of the bill, Mr. WRIGHT withdrew his amend- 
 ment for the present. 
 
 On motion of Mr. WEBSTER, the bill was amended by inserting a clause 
 making foreign coins receivable for subscriptions, at their real ascertained 
 value, and not according to the rate fixed by the former act of Congress, which 
 was admitted to be incorrect, particularly in the value placed on Spanish gold 
 coins. 
 
 Mr. SMITH, of Maryland, adverted to the insinuation which had been thrown 
 out, that the bank was not intended to be, and could not be, a specie bank; 
 and repeating that he, for one, had in view a bank of no other kind; to ensure 
 to it that character, therefore, and remove the doubts now entertained by 
 others, he moved to strike out the word Jive, (the amount of the first payment 
 required in specie) with the intention of moving to substitute a larger sum. 
 He thought it better to enable the bank to do, as soon as practicable, a liberal 
 business, and, at the same time, lessen the chance of drawing out, by any run 
 on it, the specie at first paid in, &c. 
 
 Mr. CALHOUN had not much objection to the motion, though he thought the 
 bank could certainly do safely a business to the amount of the first specie pay- 
 ment, and, if a greater business was offered to them, they would have it in their 
 power to increase their specie at pleasure. His only objection to enlarging the 
 first cash instalment was, that it might have the effect to draw the specie out 
 of the existing banks. 
 
660 BANK OF THE UNITED STATES. 
 
 Mr. SMITH'S motion to strike out the word ./we was carried; and 
 He then moved to fill the blank with the word fifteen; which was also 
 agreed to ayes 56, noes 44. 
 
 Mr. ROOT said the section under consideration was the essential part of the 
 contemplated institution, as it contained its constituent or vital parts; and 
 proceeded to enumerate the various stocks receivable in subscriptions; the 
 rates fixed for them by the bill; the price paid for them by the lenders to the 
 Government, and the profits now about to be given to those lenders, by rais- 
 ing the stocks to par; thus granting a bounty to those men. The same rea- 
 sons did not exist, he said, tor such a measure, at present, as existed at the last 
 session. Then, the credit of the Government was weak, now it is strong. 
 He would not deny that the lenders to the Government might have been ac- 
 tuated by patriotic motives, but that was no reason for granting to them any 
 thing more than was bargained for: and he proceeded to show, that, by allow- 
 ing the commissioners of the sinking fund to buy up this stock, instead of per- 
 mitting it to be subscribed in the bank, at the rates prescribed by the bill, the 
 Government would save about two millions of dollars in its redemption, &c. 
 For these and other reasons adduced, he moved to amend the bill by fixing the 
 rate at which the six per cent, stock shall be received in subscription to the 
 bank at ninety per cent, instead of par. 
 
 Mr. CALHOUN objected to the motion. Its obvious effect, if not its object, 
 he said, was to increase the bonus. If the stocks are depreciated, said Mr. 
 C., it is not the fault of the holders of it, but of the Government itself, and it 
 would be improper in the Government to take advantage of this depreciation. 
 The measure would also have an injurious influence on the subscriptions to 
 the bank, without answering any good purpose, and he, therefore, hoped the 
 motion would not prevail. 
 
 Mr. ROOT said, in reply, that those who boasted so much of having loaned 
 their money to the Government, only gave their depreciated notes, and re- 
 ceived, in return, the note of the Government, by which they made a great 
 profit, and that was all their merit, &c. 
 
 Mr. GOLDSBOROUGH made a few remarks on the motion. He thought it 
 questionable whether a Government ought to fix on its own stock a manifest 
 depreciation, and, in this instance, it would be an act of very great injustice, 
 and a violation of public faith, because, in the next clause, it was provided 
 that the stock should be redeemed and liquidated at the rates at which it was 
 paid into the bank, &c. 
 
 Mr. Ross thought the circumstance deprecated by the gentleman last up, ex- 
 isted already; which opinion he supported by a few arguments. The whole 
 system of this bill, he said, was an encouragement to stockjobbers, and was 
 of the same character as the measure which once benefitted the speculators, at 
 the expense of the Revolutionary soldier, by funding their certificates, &c. 
 
 The question was then taken on the motion of Mr. ROOT, and negatived, 
 only seven or eight gentlemen rising in favor of it. 
 The committee then rose, reported progress, and obtained leave to sit again. 
 
 MARCH 4, 1816. 
 
 The House again resolved itself into a committee of the whole, Mr. NEL- 
 SON in the chair, on the bill. 
 
 Mr. SMITH, of Maryland, moved to strike out of the 6th section the words 
 " treasury notes," as forming a constituent part of the Government subscrip- 
 tion to the bank, the ettect of which amendment would be to limit the mode 
 of payment of the subscriptions to stock and specie. 
 
 The motion was supported by Mr. SMITH, assented to by Mr. CALHOUN, 
 and opposed by Mr. HOPKIXSON; and then agreed to without a division. 
 
ON THE GRANT OP THE CHARTER OF 1816. 
 
 Mr SMITH then moved further to amend the same section, by making the 
 amount of the shares reserved to the Government receivable in stock, bear- 
 ing an interest of five instead of six per cent., with the view, also, of providing 
 subsequently, that the whole, subscription of the Government shall be made 
 on the first of January, 1817, instead of being paid in instalments, at distant 
 
 After some objection on the part of Mr. WEBSTER, the motion \vas agreed 
 to; ayes G3, noes 40. 
 
 The bill was subsequently amended, so as to make its provisions correspond 
 with the preceding amendments. 
 
 After the adoption of some other amendments, involving no principle, 
 Mr. PITKIN- moved to strike out of the 10th section so much as gives to the 
 President and Senate the power of appointing five directors of the bank. 
 
 This motion was supported by Messrs. PITKIX, WARD, HOPKIXSOX, M'Kr.E, 
 llrr.Kii, SHKFFKY, Ross, and GROSVEXOR; and opposed by Messrs. SMITH, of 
 Maryland. ('Ai.norx, TUCKER, and ROBERTSOX. 
 
 The reporter has only generalized the argument. On the one hand it was 
 said, this control over the bank would be an engine in the. hands of the Go- 
 vernment, which might be used in a manner dangerous to the best interests of 
 the country; that this feature would be pernicious to the interests of the bank, 
 which would be best managed without the interference of the Government; 
 that the reservation of this power would be of no ad\an:ag.' to the Govern- 
 ment, (except that it would tend to increase Executive patronage, already 
 much too extensive) as every necessary investigation could be made into the 
 state of the in>tituiion, without the aid of this power; that the Government 
 would have quite as much influence over the bank as it ought to have, without 
 this power being given to it; that the principle would be most odious to mo- 
 neyed men, and of such an inquisitorial character as would deter many of our 
 most respectable citizens from embarking in the institution, &c. On the other 
 hand, it was contended, by gentlemen in favor of retaining the provision, that 
 it was necessary, as well to guard the public interest as to secure a just ad- 
 ministration of the affairs of the bank, as regarded the public, that a propor- 
 tion of the direction should be appointed by the Government; that it was cer- 
 tainly not unfair that the Government should stand on a footing with the indi- 
 vidual stockholders, by having a share in the direction of the bank; that such 
 a feature existed in the charters of many State banking institutions, and was 
 not abused, as far as was known; that this power could not be dangerous 
 either to the bank or the nation, as the twenty directors appointed by the indi- 
 viduals would always be competent to control the five appointed by the Go- 
 vernment; some State banks were cited, in which the State possessed an 
 entire control, from which no disadvantage had been realized; and, as the se- 
 lection by the Government, in this case, would certainly be made with a 
 reference to the wealth and respectability of the persons chosen, no abuse 
 ought to be anticipated, any more than it could succeed, if attempted. 
 
 Before deciding the question, the committee rose, and obtained leave to sit 
 again. 
 
 MARCH 5, 1816. 
 
 The House again resolved itself into a committee of the whole, Mr. NELSON 
 in the chair, on the bill; the question to strike out the provision giving to the 
 President and Senate the power of appointing five of the directors, being still 
 under consideration. 
 
 On this question the debate was resumed, and continued to a late hour be- 
 fore the decision took place. The gentlemen who supported the amendment 
 were Messrs. GASTOX and PICKERING; and those who opposed it were Messrs. 
 WILDE, TELFAIR, WRIGHT, CLAY. CALHOUX, and FORSYTH. 
 
662 BANK OF THE UNITED STATES. 
 
 Mr. FORSYTH said he was one of those who was unfortunate enough to at- 
 tach great importance to that part of the plan of the bank which was intended 
 to be altered by the motion of the gentleman from Connecticut. At the last 
 session of Congress he had, in vain, endeavored to convince the members 
 composing it, of the necessity of retaining such an influence over the manage- 
 ment of the institution. The honorable gentleman from North Carolina (Mr. 
 GASTON) had suggested, that the opposition to the amendment proposed, came 
 from the Treasury Department, or irom the Executive. He begged leave to 
 assure him, that the recommendation or opinion, of the Department or of the 
 President, was riot the foundation of his belief of the necessity of this measure. 
 Although he did not expect to satisfy others who differed with him, of the in- 
 correctness of their views of the subject, he did hope to be able to show, at 
 least, plausible reasons in favor of his own. At the last session of Congress, 
 he had the honor to advocate, with a zeal arising from a thorough conviction 
 of the necessity of the measure, the establishment of a bank differing from the 
 present, only because it imposed an obligation to make a large loan to Go- 
 vernment. He had to regret that the ability with which that duty was dis- 
 charged, was not equal to his zeal, and still more, that his exertions were not 
 crowned with success. It would have produced at least one good effect this 
 discussion would have been avoided, and the time occupied in it might have 
 been usefully employed on a different subject. This plan failed for causes it 
 was unnecessary to trace, and its failure was rendered comparatively unim- 
 portant by the restoration of peace. He did not believe, with some gentle- 
 men, that this measure was now necessary. The necessity for it had ceased. 
 It was no longer essential; but it was both politic and prudent to adopt it. If 
 it fails, no dangerous consequences will result from its failure. He should 
 survive the shock, although this bill should follow its predecessor to the tomb. 
 The body politic was obstructed by a diseased circulation, but time would 
 furnish a healing remedy, although the application of this panacea should be 
 rejected by the State physicians. Mr. F. said, he did not wish to be under- 
 stood as recommending the establishment of any bank as prudent and politic. 
 It was not a bank, but a bank of peculiar character, which was required. We 
 had banks enough already; they rose like mushrooms, from every hot bed in the 
 country. It was not a moneyed bank only a bank exclusively regulated by 
 the moneyed interest, and governed by the jealousy, avarice, or factious views 
 of moneyed men, capable of being made the instrument of artful and design- 
 ing combinations, to cramp your resources, and destroy your capacity to make 
 either permanent or temporary loans. It must be a bank having a national 
 character, regulated by the national interest, and under the influence of the 
 national councils. If it was not of this character, its failure or success was 
 indifferent to him. It seemed to be admitted on all hands, that we ought to 
 have an interest in the proposed institution. It was admitted, too, that we 
 ought to have an influence; and the dispute was, between a direct influence 
 by the appointment of directors, or an indirect influence by the operation of 
 the revenue system. It would not be difficult to demonstrate, that an indi- 
 rect influence would be altogether insufficient. Your $7,000,000 of interest in 
 the capital gives you no power, unless it is coupled with the authority to ap- 
 point a portion of the directors. This, it is said, must not be given, because 
 you have ample influence by means of your revenue system. \V hat difference 
 will be produced by the establishment of this new plan? Will your indirect 
 inference over it be greater than over the State institutions? You may with- 
 hold your deposites; so you may from the State banks. You may refuse to 
 receive its paper in payment of taxes or imposts. You may refuse the paper 
 of the State banks. You may tax either at your pleasure. After this plan is 
 perfected, the annulment of the charter is, for twenty years, as completely be- 
 yond your authority, as the annihilation of the State banks. The sole differ- 
 ence is, that, at the end of twenty years, the Bank of the United States will 
 be dependent on you for a renewal of its charter, while the State banks look 
 only to the State Legislatures. Your power, then, over the present banks, is 
 equally great with your power over the one proposed. And this is notorious- 
 
ON THE GRANT OF THE CHARTER OF 1816. 553 
 
 ly ineffectual. An honorable gentleman from New York (Mr. GROFVKNOR) 
 has told you, and truly told you, that when you threaten the State banks, they 
 laugh at your threats; when you menace them, they menace you in turn. 
 If a mere local institution cannot be beneficially controlled by your indirect 
 influence, how can you expect to affect an institution extending through the 
 whole community, which combines the great moneyed capital of all the states 
 into one solid column of power! It seems, however, to be imagined, a direct 
 control is unnecessary. The keen magnetic sense of the directors will al- 
 ways induce them to pursue their own interest, and their interest will always 
 produce a compliance with the reasonable wishes of the Government. This 
 sense was too magnetic for Mr. F's taste; it pointed with unerring polarity to 
 self; and the general interest, when in conflict with self-interest, did not pro- 
 duce even a vibration of the needle. Besides, there was such a thing as the 
 sacrifice of pecuniary to political interest or party policy. This institution 
 might, in the course of time, full into the hands of men who would think it 
 immoral and criminal to loan their money for the necessary purposes of Go- 
 vernment. What would be the situation of the country in such an event, at 
 a time when th'.s institution furnished the great mass of the medium of circu- 
 lation? It was to guard against such an event that an immediate agency in the 
 direction was necessary: there was a greater probability of finding eight rea- 
 sonable and virtuous men out of twenty, than thirteen out of twenty-five. 
 Mr. F. regretted that the number of directors to be appointed by Govern- 
 ment was not greater; and, also, the amendment which prevented the Presi- 
 dent from appointing more than three at the seat of the mother bank; but he 
 supposed he must be satisfied with it as it stood, as there was little hope of ob- 
 taining more. It was objected, however, that moneyed men would not like 
 the introduction of this direct influence. This \\as perfectly natural. Money- 
 ed men have no objection to manage your funds for their benefit, but have no 
 desire to admit your influence in the management of theirs. But will the in- 
 troduction of this principle prevent the subscription of the capital from being 
 filled? No gentleman had, or would venture to predict, such an effect. They 
 will no doubt make wry faces, but the bitter pill would be swallowed if it 
 was well gilded. Arguments had been urged against this part of the plan, 
 founded upon the supposition that improper appointments would be made. 
 The President and Senate had not the same information to enable them to 
 choose proper directors. Stockholders were better judges of the necessary 
 qualifications of directors. Corrupt men would solicit and procure these ap- 
 pointments for improper purposes. Great injury would result to the bank 
 from their success. They would procure for themselves and friends accom- 
 modations to which they were not entitled. A slight examination of these 
 arguments would show their fallacy. Intelligence and integrity were the 
 qualifications required in directors. The same ability existed to ascertain 
 who possessed them, for this, as for all other offices. The President and Se- 
 nate can command or procure the most accurate information of the character of 
 persons who are thought of for these appointments, from every source to which 
 it may be necessary to apply. Is it not passing strange, that a mail who has 
 raked up money from every kennel into which lie may nave dipped his fingers, 
 is, from that circumstance, a better judge of the proper person for a director, 
 than the President and Senate? That a stupid fellow, who had blundered into 
 a fortune in New Orleans or Providence, should be able to procure better in- 
 formation of the character and circumstances of individuals, than the Presi- 
 dent, residing at Washington, and the Senators, coming from the several 
 States? These men, however, who intend to swindle the bank, will worm 
 themselves into the good graces of the President, and receive the appoint- 
 ment. After their appointment, paper will be discounted, having their names 
 upon it, which ought not to be discounted; because the extreme delicacy of the 
 other directors will not permit them to object to it. This morbid delicacy, 
 too, is to be found in persons chosen by the keen-sighted individual stock- 
 holders, who are the best judges of the persons competent to manage their 
 concerns. Such is the argument. It supposes folly in the President and Se- 
 
564 BANK OF THE UNITED STATES. 
 
 nate, who make the appointments; corruption in the persons seeking to be 
 appointed; and stupidity and criminality in the other directors, in permitting 
 this folly and corruption of the choosers and the chosen, to injure the insti- 
 tution. 
 
 Mr. F. asked, what advantages could be derived from this institution, if 
 this amendment prevails, which could not be produced through the agency of 
 the State banks? It is admitted, that the great object of this bill, the restora- 
 tion of specie payments, might be effected by a rigorous system of measures 
 against the State institutions. Mr. F. said, he-did not feel that indignation 
 against the State banks, for stopping the payment of specie, which had been 
 expressed by others. His indignation had been so thoroughly exhausted upon 
 the smugglers of English goods, and the cash dealers in British Government 
 bills, for the use of the Canadian army, that he had none left for the banks 
 who had loaned their notes to their own Government, who, in consequence of 
 an extraordinary emission of their paper, hud been under the necessity of dis- 
 honoring it. He was not, however, the apologist of the banks for withhold- 
 ing specie payments since the restoration of peace. It was, however, certain, 
 that no one bank could, without ruin, resume the payment of specie. The 
 resumption must be simultaneous. He had no objection to any system which 
 should induce the banks to perform their obligations in this regard to the com- 
 munity. But he protested against the cruelty and injustice of any rigorous 
 measures which should compel them, immediately, either to sell their Govern- 
 ment stock, or to curtail their discounts. It w r as saying to these banks, you 
 have loaned us too much of your paper; you have made top much money out 
 of the General Government; your paper has, indeed, performed the trifling 
 service of carrying us triumphantly through a dangerous conflict; but we are 
 not now in want of a further accommodation; you must take in your paper; 
 you must sell your stock; you must disgorge your gains; you must resume 
 your specie payments. And what will be the consequence of all this? They 
 are forced to sell their stock it goes into market, and its price is depressed. 
 Are you in a situation to buy, to take advantage of this disgorging of their 
 unrighteous gains? Far from it. You cannot be benefitted; you cannot enter 
 as a competitor into the market. And who are the gainers by this system of 
 rigor? The hard money men, who withheld their money in the hour of your 
 necessity and peril who combined together for the purpose of defeating your 
 loans. Mr. F. begged the House, if these banks were to be punished, to wait 
 until the Government, who had been the sufferer, should be prepared to take 
 advantage of their punishment. At all events, to be so cautious in their cas- 
 tigation, that, in punishing puny, petty speculation, they do not reward the 
 vilest of all gamblers: those who staked their money against the safety of your 
 empire, who sought to destroy you by cramping your resources, who sought to 
 beggar the country, that an administration might be ruined. 
 
 Mr. TELFAIR observed that the great cause of difference of opinion on this 
 question, seemed to arise from a misapprehension of those who advocated the 
 amendment, as to the primary objects for which this institution is designed. 
 Gentlemen argue as though the moving cause for the establishment of a na- 
 tional bank was the interest of the individuals who may become subscribers, 
 and that the Government has but one interest, and that is, the attainment of 
 the highest possible bonus. 
 
 In this view of the subject, I must be permitted totally to differ from those 
 who are disposed to deprive the Government of all participation in its direc- 
 tion. Did I deem it practicable to manage such an institution without great 
 liabilties to corruption of its principles, I should most decidedly prefer one 
 whose stock was exclusively the property of the nation. But it requires no 
 great political sagacity, and but ordinary experience, .to ascertain that those 
 institutions, which derive their principle of action from private interest, are 
 more active in pursuit of their object, more vigilant in the detection of error, 
 and more likely to prosper, than those which derive their impulse from the 
 spirit of patriotism, and have in contemplation solely the public good. Private 
 
ON THE GRANT OF THE CHARTER OF 1816. 555 
 
 interest is ever more active more vigilant more pervading more alive to 
 its object, than national, which is more sluggish, because its direction is to- 
 wards remote or general good less quicksighted, because its instinct is not so 
 strong. 
 
 This institution is designed not merely to fulfil the ordinary purposes of 
 banks of discounts; it aspires to great national objects; it contemplates a res- 
 toration of the legitimate currency of the country; its end is to give an uni- 
 form and valuable medium to the whole empire; its design is to Facilitate the 
 fiscal operations of the Treasury Department. It is, in one word, to restore 
 to this Government the rightful and constitutional control over the national 
 medium, which is vested in every civilized government, and which was in- 
 tended to be vested in the Congress of the United States, when to it was assigned 
 the supervisoi sh'.p of the mint establishment. These are the primary and es- 
 sential objects of its creation; from the attainment of these great objects, cer- 
 tainly benefits flow to every class o( the community; but exclusive benefits 
 are designed to none, save so much as may be deemed necessary to the ob- 
 tention of these ends, and conformable to thes : .; results. 
 
 According to these views, then, the interest of the stockholders is not to be 
 considered as holding a priority of station to that of the Government; on the 
 contrary, the institution is to be looked upon as the property of the nation, 
 and that of individuals for political considerations, viz: because their aid will 
 facilitate, or, if you please, is necessary to participate in its immediate profits 
 that it may not be wanting in that spirit which characterizes the schemes of 
 individual pursuit; that, while its capacities and controlling power be national, 
 its impulse, its life and animation, shall be private interest. But private in- 
 terest, unrestrained, naturally produces much mischief. I have admitted that 
 a bank, exclusively managed by the Government, would be exposed to a cor- 
 ruption of its principles; and, with so many facts to support me while casting 
 an eye upon the numberless banks around, 1 certainly shall not be charged 
 with overweening suspicion, when asserting that banks, too exclusively man- 
 aged by stockholders, are liable to become instruments of public evil from the 
 invitations of self-interest. 
 
 The true policy, in the creation of a bank, then, is to give it a double cha- 
 racter to combine in it the elements of public and private interest; but to 
 secure to the former a control over the latter: for the Government, which 
 creates this institution, is responsible for its fulfilment of the great objects of 
 its creation, and it is wiser to use means of precaution, than to rest upon ul- 
 timate means of severe correction. But the gentleman from North Carolina, 
 (Mr. GASTON) who has certainly spoken with ability on this subject, is satis- 
 fied with the incidental powers and benefits which the Government would 
 derive from this bank. And this brings me to two objections which have 
 been urged: first, an indescribable dread is felt of the influence of the Go- 
 vernment over this institution, provided it participates in its direction. In 
 what way, let me ask, can the influence of me Government be injurious? Is 
 it presumable that the influence of the Government would induce the bank to 
 Joan to individuals who were incapable of repaying the debt? Can it be believ- 
 ed that the Government would ever descend, by its influence over the bank, 
 to benefit one class of individuals by loans, while it oppresses another by re- 
 fusing to extend these benefits? Or. can it be imagined that the Government, 
 which is so deeply interested in preserving an uniform and valuable currency, 
 would, in ordinary circumstances, induce the bank to make over issues, and 
 thereby cause a depreciation of its paper? I presume not; these are appre- 
 hensions too fantastical to be ascribed to gentlemen of sense; they are absur- 
 dities too great for them to ascribe to a Government as enlightened as ours; 
 but, if they mean that the Government, under the pressure of trying emer- 
 gencies, may, by their influence, induce loans from the bank, which prudence, 
 in ordinary times, would forbid them to make, I shall not deny the proba- 
 bility; but must be permitted to answer, there are, or may be, periods, during 
 a nation's travail, when exertions of such means would be attended with less 
 84 
 
666 BANK OF tHE UNITED STATES. 
 
 evil than a want of money; and, as this objection has reference to an extr<?m 
 case, I am willing to await the crisis. 
 
 But, their second objection, which is not a little inconsistent with the first,- 
 is, that the President will appoint ignorant, inefficient, and needy directors* 
 What weight, then, could these directors possess? But, let us approach this 
 objection a little nearer, and look it in the face. Why is the presumption in- 
 dulged, that the President will be thus injudicious? Has he not the same re- 
 spectable class of merchants from whom to make his selection as the stock- 
 holders have? Is it reasonable to suppose that any President would be wil- 
 ling thus to commit his fame and reputation; and, if such a one could be 
 found, is there no reliance to be put upon the vigilance of the Senate? But, 
 the gentleman from North Carolina thinks that the Government is never safe 
 in trusting its money concerns m the hands of an individual. How, then v 
 Mr. Chairman, is any nation to transact its financial concerns? Does our Go- 
 vernment not daily trust individuals with its money? Is Ft not obliged to do 
 so? And if, in this case, it did not trust directors appointed by kself, would 
 it not be obliged, exclusively, to trust those appointed by the stockholders? 
 If the gentleman's argument is carried a little further, it would recommend 
 the system of farming the revenue, as pursued in France, instead of appoint- 
 ing our own officers to collect it. Our policy, in collecting the dues of the 
 Government, has been to couple the interest of the officer with our own; he 
 derives a profit or per centage upon the money collected, and hence the stimu- 
 lus superadded to that of a sense of duty. The interest of this bank should 
 be made subservient to the interest of the public of the People; and hence I 
 wish for some control in its direction, 
 
 In the course of the day, an amendment was adopted, on motion of Mr- 
 CONDICT, to confine the selection of directors, to be made by the President and 
 Senate, to persons holding stock in the bank. 
 
 On motion of Mr. SMITH, of Maryland, an amendment was also adopted,, 
 to prevent more than three of the directors, appointed by the President and 
 Senate, irom being taken from any one State. 
 
 The main question was at length taken, about 4 o'clock, on Mr. PIT-KIN'S; 
 motion, to exclude the Government from the appointment of any of the direc- 
 tors, and decided in the negative. 
 
 For the amendment, 64, 
 
 Against it, 79. 
 
 The committee then rose, reported progress, and obtained leave to sit again. 
 
 MARCH 6, 1816, 
 
 The House again resolved itself into a committee of the whole, Mr. NEL- 
 SON, of Virginia, in the chair, on the bill. 
 
 Mr. SMITH, of Maryland, moved to amend the 10th section, so as to allow 
 the choice of president of the bank to be made from any of the directors, and 
 not to confine the selection of that officer to one of the directors appointed 
 by the president and Senate. Mr. S. made a few remarks in justification of 
 his motion. 
 
 Mr. CALHOUN had no objection to the amendment. He thought the clause 
 proposed to be amended not necessary to give the Government a due control 
 over the concerns of the bank; and that it would still retain as much influ- 
 ence, as would serve every beneficial purpose. 
 
 Mr. ROBERTSON condemned the motion. He thought it would diminish 
 too greatly the power which it was necessary the Government should have 
 over the bank. He did not want merely a great money machine, but an in- 
 stitution of a national character; and therefore could not consent to part with, 
 one after another, all the features of the bill which gave the Government a 
 
ON THE GRANT OF THE CHARTER OF 1816. 
 
 proper and necessary control over the bank. He adverted to the liberality 
 which had been manifested by the chairman who reported the bill, (Mr. CAL- 
 HOUX) and thought the principle of accommodation might be carried too far 
 he admonished gentlemen to remember the painter, who flattered every body 
 and pleased nobody. His fate would be that of the bill, if this spirit of con- 
 cession was carried too far; and he could not, for one, be so far governed by 
 it, as to give up those powers whicli were necessary to the salutary management 
 of the bank, and without which it would not be worth having. 
 
 Mr. Ross could see no reason why the president of tlie bank should not be 
 selected from the whole twenty-five directors, if it was the object to get the 
 best man. If the President and Senate appoint a director the most proper for 
 the office, he would doubtless be elected, but if not, why exclude the fittest 
 character? It would have been just as well to confine the selection of Presi- 
 dent of the United States to one State, though it might not contain a person 
 as well qualified as one in another State. Mr. R. called the attention of the 
 House to the importance of the office and duties of the president of the bank, 
 and the absolute necessity of selecting the director best qualified. Such a 
 course was congenial with our politicalinstitutions, although he believed the 
 bank itself was by no means congenial with the constitution; being,as he viewed 
 it, a moneyed aristocracy. He condemned the policy of giving so much addi- 
 tional strength to the Executive arm. Alexander Hamilton himself, in the 
 zenith of his influence, would not have dared to propose such a grant of power 
 to the President, as the control and regulation of a great moneyed institution. 
 Mr. R. concluded by saying he thought it would be much safer to adopt the 
 amendment, and withhold from the Executive so important a power, &c. 
 
 Mr. CALHOUX rose to make a remark or two in reply to his friend (Mr. RO- 
 BERTSON.) He almost despaired of the passage of the bill, after some of the 
 indications which he had witnessed, and began to doubt whether any bill 
 would pass at all on the subject. For himself, Mr. C. said, his anxiety for 
 the measure was not extreme; but, as long as there was a lingering hope of its 
 success, lie should omit no effort to make it an efficient remedy for the evils of 
 the present currency. If, after making it suit, as far as possible, the taste of 
 every one, gentlemen determined to oppose it, it was time for them to look 
 out tor some other remedy. Mr. C. said he felt deeply the evil of the disor- 
 dered state of our currency, and the necessity of a cure. In devising that 
 cure, difficulties were to be expected. The direction of the bank he knew 
 had been made a sine qua non by some gentlemen, on one side of the House, 
 and he was sorry to find it was one also with some on the other. It was a 
 fate peculiar to great measures, to fall in their details. The obstinacy of gen- 
 tlemen in matters of what they deemed principle, was honorable to them, but 
 he feared it would be fatal to the bill. He lamented it the disorders were 
 so deep, so great, that justice to the country called for a remedy at the hands 
 of the Government. If gentlemen would seriously consider the character, and 
 power, and nature of the evil two hundred and sixty banks issuing almost as 
 many millions of depreciated paper they must see the necessity of co-operat- 
 ing in the measure of relief. The necessity for union was great and urgent, 
 for the disease was almost incurable it was a leprosy on the body politic, &c. 
 
 The question was then taken on Mr. Smith's motion, and carried: ayes 80, 
 nays 46. 
 
 After some further amendment, affecting no principle, 
 
 Mr. RANDOLPH moved to add the word native in the clause which limits 
 the choice of directors to citizens of the United States; which motion was 
 agreed to without debate ayes G8. 
 
 After the committee had proceeded to the clause, which provides for the 
 appointment of directors for the branch banks, which clause likewise re- 
 stricted the choice to citizens of the United States 
 
BANK OF THE UNITED STATES. 
 
 Mr. JEWETT moved that the word native be inserted also in that clause, so 
 as to limit the appointment to native citizens. 
 
 Mr. CALHOUN objected to the amendment. It was the first time, Fie said, 
 that any attempt had been made in this country to discriminate between na- 
 tive and naturalized citizens. The constitution recognised no such distinc- 
 tion, except in the eligibility of the highest office in the Government, and he 
 could see no reason for introducing, on this occasion, so odious and unprece- 
 dented a distinction. 
 
 Mr. RANI>OLPH ? in reply, spoke at considerable length in support of the 
 motion. He inveighed with much acrimony against the whole class of natur- 
 alized citizens, attributing to them the declaration of war, and almost all other 
 political evils: and maintaining that they ought to be admitted only on the 
 looting of denizens, without any participation in the counsels of the country, 
 and the benefit only of protection during good behavior, &c. 
 
 Mr. WRIGHT replied with warmth to Mr. RANDOLPH; after which 
 
 The question was taken on Mr. JEWKTT'S motion, and lost, without a di- 
 vision. 
 
 Mr. SMITH, of Maryland, then moved to strike out that part of the 17th sec- 
 tion which gives the President of the United States power, during the recess of 
 Congress, on the application of the stockholders, to authorize the bank to sus- 
 pend the payment of specie. 
 
 Mr. CALHOUN, after admitting the propriety of the motion, said he had no 
 objection to extend it to the whole proviso of the section, so as to deprive Con- 
 gress, as well as the President, of the power to suspend specie payments. 
 
 Mr. FORSYTH opposed this proposition, and Mr. RANDOLPH supported it; 
 after which, 
 
 The committee rose, reported progress, and obtained leave to sit again. 
 
 MARCH 7, 181C. 
 
 The House resolved itself into a committee of the whole, Mr. NELSON, of 
 Virginia, in the chair, on the bill: the motion to strike out the proviso which 
 gives to Congress the power of authorizing the bank, on application of the 
 stockholders, to suspend the payment of specie, being still under consider- 
 ation. 
 
 The discussion of this motion was widely debated by various gentlemen. 
 
 The debate was resumed on this question, and continued about two hours. 
 
 The motion to strike out the proviso was decided in the affirmative, by a 
 large majority. 
 
 Some other amendments were also made to the bill. 
 
 The committee at length got through the bill, when it rose, reported pro- 
 gress, and obtained leave to sit again. 
 
 MARCH 9, 1816. 
 
 The intervening orders of the day were, on motion, postponed, and the 
 House resolved itself into a Committee of the Whole, Mr. BRACKENRIDGE, of 
 Virginia, in the chair, on the national bank bill. 
 
 Mr. CADY offered an amendment to prevent the establishment of more than 
 one branch of the bank in any one State. 
 
 The motion was opposed by Messrs. CALHOUN, BRADBURY, and WRIGHT, 
 and supported by Messrs. CADY, and CULPEPER, and then negatived, without 
 a division. 
 
 After some unimportant amendments, and the bill having been gone through, 
 the question was stated: " Shall the committee rise and report the bill to the 
 House ?" when 
 
ON THE GRANT OF THE CHARTER OF 1816. 
 
 Mr. CLAY rose, and delivered at length, his sentiments in favor of the bill, 
 its principle, and details. 
 
 [The speech delivered on this occasion, by Mr. CLAY, appears not to have been print- 
 ed in the newspapers of the day, and, of course, cannot be inserted as uttered in the 
 House; but, after the return of Mr. C, to Kentucky, he made an address to his con- 
 stituents, in which the part he took in the House, in regard to the bank, is ex- 
 plained. The following 1 is what he then said upon this subject.] 
 
 On one subject, that of the Bank of the United States, to which, at the 
 late session of Congress, he gave his humble support, Mr. CLAY felt particu- 
 larly anxious to explain the grounds on which he had acted. This explana- 
 tion, if not due to his own character, the State and the district to which he 
 belonged had a right to demand. It would have been unnecessary, if his 
 observations, addressed to the House of Representatives, pending the mea- 
 sure, had been published; but they were not published, and why they were 
 not published he was unadvised. 
 
 When he was a member of the Senate of the United States, he was induced 
 to oppose the reneyval of the charter to the old Bank of the United States, by 
 three general considerations: The lirst was, that he was instructed to oppose 
 it by the Legislature of the State. What were the reasons that operated with 
 the Legislature, in giving the instruction, he did not know. He had under- 
 stood trom members of that body, at the time it was given, that a clause, de- 
 claring that Congress had no power to grant the charter, was stricken out; 
 from which it might be inferred, either that the Legislature did not believe a 
 bank to be unconstitutional, or that it had formed no opinion on that point. 
 This inference derives additional strength from the fact, that, although the 
 two late Senators from this State, as well as the present Senators, voted for a 
 Rational Bank, the Legislature, which must have been well apprised that 
 such a measure was in contemplation, did not again interpose, either to pro- 
 test against the measure itself, or to censure the conduct of those Senators. 
 From this silence, on the part of a body which has ever fixed a watchful eye 
 upon the proceedings of the General Government, he had a right to believe 
 that the Legislature of Kentucky saw, without dissatisfaction, the proposal to 
 establish_a National Bank; and that its opposition to the former one was upon 
 grounds of expediency, applicable to that corporation alone, or no longer ex- 
 isting. But when, at the last session, the question came up as to the esta- 
 blishment of a National Bank, being a member of the House of Representa- 
 tives, the point of inquiry with him was, not so much what was the opinion of 
 the Legislature, although, undoubtedly, the opinion of a body so respectable 
 would nave great weight with him under any circumstances, as what were 
 the sentiments of his immediate constituents. These he believed to be in 
 favor of such an institution, from the following circumstances: In the first 
 place, his predecessor (Mr. HAWKINS) voted for a National Bank, without 
 the slightest murmur of discontent. Secondly, during the last Fall, when he 
 was in his district, he conversed freely with many of his constituents upon 
 that subject, then the most common topic of conversation, and all, without a 
 single exception, as far as he recollected, agreed that it was a desirable, if 
 not the only efficient remedy for the alarming evils in the currency of the 
 country. And, lastly, during the session/he received many letters from his 
 constituents, prior to the passage of the bill, all of which concurred, he be- 
 lieved, without a solitary exception, in advising the measure. So far, then, 
 from being instructed by his district to oppose the bank, he had what was per- 
 haps tantamount to an instruction to support it the acquiescence of his con- 
 stituents in the vote of their former representative, and the communications, 
 oral and written, of the opinions of many of them in favor of a bank. 
 
 The next consideration which induced him to oppose the renewal of the 
 old charter, was, that he believed the corporation had, during a portion of the 
 
670 B ANK OF THE UNITED STATES. 
 
 period of its existence, abused its powers, and had sought to subserve the 
 views of a political party. Instances of its oppression, for that purpose, were 
 asserted to have occurred at Philadelphia, and at Charleston; and, although 
 denied in Congress, by the friends of the institution, during the discussions 
 on the application for the renewal of the charter, they were, in his judgment, 
 satisfactorily made out. This oppression, indeed, was admitted in the House 
 of Representatives, in the debate on the present bank, by a distinguished 
 member of that party which had so warmly espoused the renewal of the old 
 charter. It may be said, what security is there that the new bank will not 
 imitate this example of oppression? He answered, the fate of the old bank- 
 warning all similar institutions to shun politics, with which they ought riot to 
 have any concern; the existence of abundant competition, arising from the 
 great multiplication of banks, and the precautions which are to be found in 
 the details of the present bill. 
 
 A third consideration upon which he acted in 1811 was, that, as the power 
 to create a corporation, such as was proposed to be continued, was not speci- 
 fically granted in the constitution, and did not then appear to him to be ne- 
 cessary to carry into effect any of the powers which were specifically granted, 
 Congress was not authorized to continue the bank. The constitution, he 
 said, contained powers delegated, and prohibitory powers expressed and con- 
 structive. It vests in Congress all powers necessary to give effect to the enu- 
 merated powers; all that may be necessary to put into motion and activity the 
 machine of government which it constructs. The powers that may be so ne- 
 cessary, are deducible by construction; they are not defined in the constitu- 
 tion; they are, from their nature, indefinable. When the question is in rela- 
 tion to one of these powers, the point of inquiry should be, is its exertion ne- 
 cessary to carry into effect any of the enumerated powers and objects of the 
 General Government? With regard to the degree of necessity, various rules 
 have been, at different times, laid down; but, perhaps, at last, there is no 
 other than a sound and honest judgment exercised, under the checks and con- 
 trol which belong to the constitution and the people. 
 
 The constructive powers being auxiliary to the specifically granted powers, 
 and depending for their sanction and existence upon a necessity to give effect 
 to the latter, which necessity is to be sought for and ascertained by a sound 
 and honest discretion, it is manifest that this necessity may not be perceived, 
 at one time, under one state of things, when it is perceived, at another time, 
 under a different state of things. The constitution, it is true, never changes; 
 it is always the same; but the force of circumstances, and the lights of expe- 
 rience, may evolve to the fallible persons, charged with its administration, the 
 fitness and necessity of a particular exercise of constructive power to-day, 
 which they did not see at a former period. 
 
 Mr. C. proceeded to remark, that, when the application was made to renew 
 the old charter of the Bank of the United States, such an institution did not 
 appear to him to be so necessary to the fulfilment of any of the objects speci- 
 fically enumerated in the constitution, as to justify Congress in assuming, by 
 construction, a power to establish it; it was supported mainly upon the ground 
 that it was indispensable to the treasury operations. But the local institutions 
 in the several States were, at that time, in prosperous existence, confided in 
 by the community, having a confidence in each other, and maintaining an in- 
 tercourse and connexion, the most intimate. Many of them were actually 
 employed by the treasury, to aid that department in a part of its fiscal ar- 
 rangements; and they appeared to him to be fully capable of affording to it 
 all the facility that it ought to desire in all of them. They superseded, in his 
 judgment, the necessity of a national institution. But how stood the case in 
 1816, when he was called upon again to examine the power of the General 
 Government to incorporate a National Bank? A total change of circumstances 
 was presented events of the utmost magnitude had intervened. 
 
 A general suspension of specie payments had taken place, and this had led 
 to a train of consequences of the most alarming nature. He beheld, dispersed 
 over the immense extent of the United States, about three hundred banking 
 
ON THE GRANT OF THE CHARTER OF 1816. 57} 
 
 institutions, enjoying, in different degrees, the confidence of the public, 
 shaken as to them an, under no direct control of the General Government, 
 and subject to no actual responsibility to the State authorities. These insti- 
 tutions were emitting the actual currency of the United Statesa currency 
 consisting of a paper, on which they neither paid interest nor principal, whilst 
 it was exchanged for the paper of the community, on which both were paid. 
 He saw these institutions, in fact, exercising, what had been considered at all 
 times, and in all countries, one of the highest attributes of sovereignty the 
 regulation of the current medium of the country. They were no longer com- 
 petent to assist the treasury, in either of the great operations of ejection, 
 deposite, or distribution ot the public revenues. In fact, the paper which 
 they emitted, and which the treasury, from the force of events, found itself 
 constrained to receive, was constantly obstructing the operations of that de- 
 partment; for it would accumulate where it was not wanted, and could not be 
 used where it was wanted for the purposes of Government, without a ruinous 
 and arbitrary brokerage. Every man who paid or received from the Govern- 
 ment, paid or received as much less than he ought to have done, as was the 
 difference between the medium in which the payment was effected and specie. 
 Taxes were no longer uniform. In New England, where specie payments 
 have not been suspended, the people were called upon to pay larger contribu- 
 tions than where they vvere suspended. In Kentucky, as much more was 
 paid by the people in their taxes, than was paid, for example, in the State of 
 Ohio, as Kentucky paper was worth more than Ohio paper. 
 
 It appeared to Mr. C. that, in this condition of things, the General Go- 
 vernment could depend no longer upon these local institutions, multiplied 
 and multiplying daily; coming into existence by the breath of eighteen State 
 sovereignties, some of which, by a single act of volition, had created twenty 
 or thirty at a time. Even if the resumption of specie payments could have 
 been anticipated, the General Government remaining passive, it did not seem 
 to him that the General Government ought longer to depend upon these local 
 institutions exclusively for aid in its operations; but he did not believe it 
 could be justly so anticipated. It was not the interest of all of them, that the 
 renewal should take place of specie payments; and yet, without concert be- 
 tween all, or most of them, it could not be effected. With regard to those 
 disposed to return to a regular state of things, great difficulties might arise 
 as to the time of its commencement. 
 
 Considering, then, that the state of the currency was such, that no thinking 
 man could contemplate it without the most serious alarm; that it threatened 
 general distress, if it did not ultimately lead to convulsion and subversion of 
 the Government, it appeared to him to be the duty of Congress to apply a 
 remedy, if a remedy could be devised. A National Bank, with other auxili- 
 ary measures, was proposed as that remedy. Mr. C. said he determined to 
 examine the question, with as little prejudice as possible arising from his for- 
 mer opinion; he knew that the safest course to him, if he pursued a cold cal- 
 culating prudence, was to adhere to that opinion, right or wrong. He .was 
 perfectly aware, that, if he changed, or seemed to change it, he should ex- 
 pose himself to some censure; but, looking at the subject, with the light shed 
 upon it by events happening since the commencement of the war, he could 
 no longer doubt. A bank appeared to him not only necessary, but indispen- 
 sably necessary, in connexion with another measure, to remedy the evils of 
 which all vvere but too sensible. He preferred to the suggestions of the pride 
 of consistency, the evident interests of the community, and determined to 
 throw himselt upon their candor and justice. That which appeared to him, in 
 1811, under the state of things then existing, not to be necessary to the Gene- 
 ral Government, seemed now to be necessary, under the present state of 
 things. Had he then foreseen what now exists, and no objection had laid 
 against the renewal of the charter, other than that derived from the constitu- 
 tion, he should have voted for the renewal. 
 
 Other provisions of the constitution, but little noticed, if noticed at all, on 
 the discussions in Congress in 1811, would seem to urge that body to exert 
 
672 BANK OF THE UNITED STATES. 
 
 all its powers to restore to a sound state the money of the country. That in- 
 strument confers upon Congress the power to coin money, and to regulate the 
 value of foreign coins; and the States are prohibited to coin money, to emit 
 bills of credit, or to make any thing but gold and silver coin a tender in pay- 
 ment of debts. The plain inference is, that the subject of the general cur- 
 rency was intended to be submitted exclusively to the General Government. 
 In point of fact, however, the regulation of the general currency is in the hands 
 of the State Governments, or, which is the same thing, of the banks created 
 by them. Their paper has every quality of money, except that of being made 
 a tender, and even this is imparted to it by some States, in the law, by which a 
 creditor must receive it, or submit to a ruinous suspension of the payment of 
 his debt. It was incumbent upon Congress to recover the control which it 
 had lost, over the general currency; the remedy called for, was one of cau- 
 tion and moderation, but of firmness. Whether a remedy directly acting 
 upon the banks, and their paper thrown into circulation, was in the power of 
 the General Government, or not, neither Congress, nor the community, were 
 prepared for the application of such a remedy; an indirect remedy, of a milder 
 character, seemed to be furnished by a National Bank. Going into operation 
 with the powerful aid of the treasury of the United States, he believed it 
 would be highly instrumental in the renewal of specie payments. Coupled 
 with the other measure adopted by Congress, for that object, h'j believed the 
 remedy effectual. The local banks must follow the example which the Na- 
 tional Bank would set them, of redeeming their notes by the payment of 
 specie, or their notes will be discredited and put down. 
 
 If the constitution then warranted the establishment of a bank, other con- 
 siderations besides those already mentioned strongly urged it. The want of 
 a general medium is every where felt; exchange varies continually, not only 
 between different parts of the Union, but between different parts of the same 
 city. If the paper of a National Bank were not redeemed in specie, it would 
 be much better than the. current paper; since, although its value, in compari- 
 son with specie, might fluctuate, it would afford an uniform standard. 
 
 If political power be incidental to banking corporations, there ought, per- 
 haps, to be in the General Government some counterpoise to that which is 
 exerted by the States. Such a counterpoise might not indeed be so necessary, 
 if the States exercised the povyer to incorporate banks equally, or in propor- 
 tion to their respective populations. But that is not the case. A single State 
 has a banking capital equivalent, or nearly so, to one-fifth of the whole banking 
 capital of the United States. Four States combined have the major part of the 
 banking capital of the United States. In the event of any convulsion, in which 
 the distribution of banking institutions might be important, it may be urged 
 that the mischief would not be alleviated by the creation of a National Bank, 
 since its location must be within one of the States. But, in this respect, the 
 location of the bank is extremely favorable, being in one of the middle States, 
 not likely, from its position, as well as its loyalty, to concur in any scheme 
 for subverting the Government; and a sufficient security against such contin- 
 gency is to be found in the distribution of branches in different States, acting 
 and reacting upon the parent institution, and upon each other. 
 
 A desultory debate followed, between Mr. JACKSON, Mr. CLAY, and Mr. 
 RANDOLPH, on one or two points of Mr. CLAY'S arguments. 
 After which, the committee rose, and reported the bill and amendments. 
 
 MARCH 11, 1816. 
 
 The House resumed the consideration of the bill. 
 
 The House successively concurred in the amendments of the committee of 
 the whole, without objection, until it reached that which substituted the sum 
 ofjtfteen dollars, as the second cash instalment to the bank, instead of Jive. 
 
 Mr. CALHOUN repeated the objections that he made in the committee, to 
 this amendment, and moved that the House disagree thereto, with the view 
 hereafter of making the sum ten dollars. 
 
ON THE GRANT OI> THE CHARTER OF 1816. 573 
 
 After a few remarks from Mr. SMITH, of Maryland, in justification of the 
 amendment, 
 
 It was disagreed to by the House. 
 
 The House then proceeded to that amendment of the committee which re- 
 strained the Government from appointing more than three of its directors from 
 any one State. 
 
 This amendment was objected to, in a few words, by Mr. TELFAIR, arid 
 opposed, also, by Mr. ROBERTSON, at some length, who wished the clause 
 restored to its original state. 
 
 After a few remarks from Mr. SMITH, of Maryland, in favor of the amend- 
 ment, it was concurred in. 
 
 The next amendment considered, was that which added the word * 4 native" 
 to a clause of the bill, and thereby excluded from the direction naturalized 
 citizens. 
 
 Mr. CALHOUN opposed the adoption of this amendment, on the ground for- 
 merly stated; and Mr. RANDOLPH again advocated it, in a short speech; when 
 
 The decision of the committee was reversed, and the word " native" reject- 
 ed; ayes 44, noes 67. 
 
 On motion of Mr. WEBSTER, the bill was then so amended, after a short 
 discussion, in which Mr. SMITH, of Maryland, opposed the motion, as to 
 make it equally compulsory and penal on the bank to pay its deposites in spe- 
 cie, as its notes or bills. 
 
 When the House arrived at the amendment providing sanctions for com- 
 pelling the bank to perform its engagements, 
 
 Mr. WRIGHT made a motion substantially to strike out the clause which 
 makes the charter forfeitable, in case of the non-payment of specie, and 
 thereby leave only the penalty of paying ten per cent, on their notes, if not 
 so paid. 
 
 MARCH 12, 1816. 
 
 The House proceeded to the order of the day, being the report of the com- 
 mittee of the whole House on the bill; the motion to strike out that part of 
 an amendment reported by the committee which makes the charter forfeitable 
 for non-payment of its notes in specie, being still under consideration. 
 
 Mr. CALHOUN supported the motion to amend the amendment. It was 
 with much reluctance, Mr. C. said, that he opposed any provision which the 
 House had deemed necessary to perfect the bill, but, in the present instance, 
 he was compelled to make an objection. The fundamental character of this 
 bank was, that it should pay its notes in gold or silver coin; and a sufficient 
 penalty was provided to enect that end. It is a good rule in law, said Mr. 
 C., that, where you attach a separate penalty to a particular violation of a law, 
 you weaken the general penalty; and, as he thought the general penalty would 
 attach in the case, without tins special provision, which would, therefore, 
 weaken the general sanctions of the bill, he hoped it would be stricken out. 
 
 [The amendment under consideration, proposed by the committee of the 
 whole, was this: to add to the 18th section, 4 * And, in 'case of failure of the 
 said corporation to pay and discharge the notes thereof, in gold or silver coin, 
 on demand, then, and in that case, the charter hereby granted shall be void; 
 and, moreover, the holder of every such note, the payment whereof, in gold or 
 silver, shall have been refused, may recover of the said corporation the amount 
 thereof, together with interest, at the rate often per centum per annum, from 
 the time at which the same shall have been demanded until payment. Mr. 
 >V RIGHT'S motion was to strike out the words in italic; and it was agreed to, 
 without a division.] 
 
 Mr. RANDOLPH then moved to amend the amendment of the committee, by 
 making the interest demandable on the notes of the bank, in case of refusal to 
 pay specie, twenty per cent, instead of ten. 
 85 
 
674 BANK OF THE UNITED STATES. 
 
 Mr. CALHOUN repeated the reluctance with which he objected to any mo- 
 tion which, in the opinion of the gentleman who made it, would improve the 
 bill 5 but, he had thought that even the propriety of ten per cent, contemplat- 
 ed by the bill, was very questionable, as he doubted whether that provision 
 might not produce combinations against the bank, which were so anxiously 
 guarded against. Every man acquainted with the subject knows, that no bank 
 can, at all times, possess the means of meeting a general run upon it; and 
 he submitted it to the House, whether such a provision as was now proposed, 
 would not be dangerous to the institution, by inviting a run on it, and there- 
 by producing a suspension of payment. He admitted that it vyas all important 
 to the benefit anticipated from the bank, that it should pay its notes, at all 
 times, in specie; and he thought that end already secured by other sanctions 
 sufficiently guarded. This bank, said Mr. C. is no more than a part of the 
 commercial community in which it is established, and any embarrassment of 
 the bank must press, also, on the whole commercial community; that commu- 
 nity would be the first to give way in such a case, and this would produce a 
 run on the bank, and compel the stoppage of payment. If the amendment 
 would produce a greater certainty of specie payments, it might be proper; 
 but believing that it might defeat its own object, and produce that which it 
 was intended to guard against, he thought it dangerous, &c. 
 
 Mr. WARD, of Massachusetts, was in favor of the amendment. He thought 
 Mr. CALHOUN had over-rated the mischiefs which might possibly ensue from 
 its adoption. Mr. W. believed that no person would resort to the penalty, 
 unless where the bank might exceed a temporary refusal to pay its notes. If 
 the bank declined payment for a short time only, there was no person who 
 would peremptorily go to law for the penalty; and there was no danger of the 
 combination predicted. It was his opinion that the provision would be bene- 
 ficial to the bank, by the character it would give it as a specie bank, the su- 
 perior confidence which it would of course possess throughout the country, 
 and the great business it would consequently be enabled to do, &c. 
 
 Mr. RANDOLPH said the argument of the gentleman from South Carolina 
 (Mr. CALHOUN) was a very powerful objection to the principle of the bill, but 
 none against the amendment; it was an argument which he had been keeping 
 in reserve by himself, for another stage of the bill. He had no objection to take 
 fifteen per cent, as the penalty, but ne preferred twenty, for another reason. 
 The flagitious conduct of the banks, for some time back, had proven that they 
 could make ten per cent, more than their fair profits: and his object vvas to make 
 the damages surpass any profits the bank could make by refusing to pay 
 specie. We ought ? he said, to remember certain surplusses which the banks, 
 on particular occasions, distributed, in addition to the declared dividends, and 
 it was proper in this case to guard against speculation of this kind. All 
 banking institutions were alike in their desire to swell their profits to the great- 
 est extent, howsoever correct and virtuous the directors might be in their pri- 
 vate characters; and he would guard against every public robber of every 
 S-ade, whether he be a governor general of India or a Bagshot highwayman, 
 e would put it out of the power of this bank to commit frauds on the communi- 
 ty, without ruin to itself. Let the penalty be ample, said Mr. R. Make the 
 bank a good one, and there is no danger of their being unable always to pay 
 specie. 
 
 The question on making the penalty twenty instead of ten per cent, was 
 then taken, and negatived: ayes 52, noes 70. 
 
 The House then proceeded with the remaining amendments of the committee 
 of the whole; the consideration and decision on which having been completed, 
 
 Mr. CALHOUN moved to amend the bill, by fixing the amount of the second 
 cash payment at ten dollars, instead of five, as it stood in the bill. This being 
 agreed to, and some other minor motions being disposed of, 
 
ON THE GRANT OF THE CHARTER OF 18 
 
 Mr. WEBSTER moved to amend the clause which declares that the 
 may sue and be sued "in all courts whatsoever," by designating tn 
 courts. 
 
 Mr. HALL asked if it would not be better, before this motion was acted on, 
 to inquire a little whether Congress have the power to grant jurisdiction to the 
 State courts, which, in some cases, they had refused to exercise, he thought 
 properly, and the constitutionality of which was very doubtful. 
 
 Mr. WEBSTER said the question was an important one; but this was not the 
 first time Congress had legislated on it, though the courts of Virginia had re- 
 sisted their jurisdiction. Without, however, discussing the question at present, 
 Mr. W. said the bill was just as objectionable as it stood, because it gave the 
 bank the power to appear in "all courts whatsoever." 
 
 After some further discussion between Messrs. CALHOUN, WRIGHT, WILDE, 
 and GROSVENOR, on the propriety of granting jurisdiction to the State courts, 
 specifically, 
 
 The question was taken, and the amendment adopted. 
 
 Mr. ROOT then renewed the motion he had unsuccessfully made, in com- 
 mittee of the whole, to reduce the rate at which six per cent, stock is to be 
 received in subscriptions to the bank, from par to ninety per cent. Mr. R. re- 
 peated briefly his reasons for the motion, already stated, and Mr. CALHOUN, 
 his objections to it; when, after some remarks in support of it by Mr. Ross, 
 
 The question was taken, and decided in the negative: yeas, 31; nays, IOC. 
 
 Mr. HALL, of Georgia, then mrwed a new section to the bill, the object of 
 which was to apply the bonus arising to the Government from the incorpora- 
 tion of the bank, to the internal improvement of the country; and, to avoid 
 any contention about the part of the country at which to commence the work, 
 Mr. M. said he would leave that to the decision of a future Congress. The 
 bonus, he thought, would afford, from year to year, as much as could be easily 
 employed, and, by the end of twenty years, when the charter would ex- 
 pire, the proceeds would have accomplished every object of improvement 
 which would be proper for the General Government to attempt. 
 
 Mr. CALHOUN declared his approbation of the object, but feared the adop- 
 tion of the amendment might drive off* some who would otherwise support the 
 bill. Unfortunately for us, he said, there was not a unanimous feeling in fa- 
 vor of internal improvement, some believing this not the proper time to com- 
 mence that work; and such a provision might deprive the bill of some friends, 
 which, at present, was the main object of nis solicitude. 
 
 Mr. HALL thought this the most proper moment for commencing the great 
 work of internal improvement; but, if ne thought this amendment would draw 
 oft' any support from the bill, he would not urge it. He believed, however, 
 it would produce a different effect, and would gain friends for the bill, who, 
 otherwise, would not vote for it. His principal reason for wishing to provide 
 for his object in this bill, was, that it would then be sanctioned by a charter, 
 and not revocable, &c. 
 
 Mr. GROSVENOR had no objection to the application of the bonus in the way 
 proposed, but he disapproved of providing for the object in this bill. Govern- 
 ment might hereafter wish, for various reasons, to get rid of its stock in the 
 bank, but it would be precluded from doing so, if this amendment \vasadopt- 
 ed. There was no good reason for attaching it to this bill, because, if a ma- 
 jority of the House were, as he hoped they were, friendly to internal improve- 
 ments, they could act on the subject separately. 
 
 Mr. WRIGHT and Mr. WILDE successively offered some remarks in favor 
 of the motion. 
 
 The amendment was rejected by a considerable majority. 
 
 Mr. CONDICT proposed to amend the bill, by substituting "New York" for 
 "Philadelphia," in the clause \vhich fixed the location of the bank. It was, 
 
(376 BANK OF THE UNITED STATES. 
 
 Mr. C. remarked, unnecessary to say any thing as to the considerations which 
 ought to prevail, infixing a bank for commercial purposes. He would mere- 
 ly remark, that, in addition to the superior commerce of New York,*the bank, 
 in that city, would serve the financial purposes of the Government as well a 
 it could at Philadelphia. In the latter city, he believed, moreover, there was 
 already a plenty of bank capital, &c. 
 
 Mr. CALHOUN observed that this was a question on which, he presumed, 
 all- had made up their minds; and it would be superfluous to say any thing on 
 it. He hoped, however, the motion would not prevail. The old Bank of the 
 United States was established at Philadelphia, and he would prefer that city 
 for the present institution. 
 
 Mr. ROBERTSON said that Mr. CALHOUN'S reason for preferring Philadelphia, 
 if it had any weight at all, operated against himself; for the old bank having 
 been fixed in Philadelphia was an argument for placing this bank in some 
 other city, that the benefits might not be given to one place alone; besides, if 
 thejwnk was taken from the seat of Government, to place it in a more com- 
 mercial situation, it ought to be fixed in that city which was most commercial. 
 But he had another objection, in this case, to Philadelphia, and, with him, the 
 strongest one; this was, the hostility of the representatives of that city to the 
 bank itself. He would not consent to impose upon a place an institution which 
 was so odious to them, &c. 
 
 Mr. WRIGHT also spoke in favor of the motion, and incidentally urged the 
 high claims otBaltimore and of Washington city. 
 
 Mr. COMSTOCK argued in favor of New York, as possessing superior com- 
 mercial advantages, and the propriety of selecting that city for a bank intend- 
 ed to aid commercial activity, &c. 
 
 The motion to strike out Philadelphia, and insert New York, was then de- 
 cided in the affirmative: 
 
 For the motion, - - 70, 
 
 Against it, - ... 64. 
 
 Mr. ATHERTON, with a view to restrain attempts to speculate in the stock 
 of the bank, by persons subscribing for more than they could pay for, and sell- 
 ing it afterwards at an advanced price, and to make all the subscriptions bona 
 fide ones, moved substantially to amend the bill, by providing that, in appor- 
 tioning the shares, no subscription should be reduced as long as there was on 
 the list a larger subscription. 
 
 After a few words from Mr. SMITH, of Maryland, who thought the provision 
 would be ineffectual and was unnecessary, the amendment was adopted, ayes 
 67, noes 43. 
 
 Mr. MAYRANT offered a new section to the bill, the object of which was to 
 
 allow the five directors appointed by the Government, each, a salary of 
 
 dollars; and to prevent their obtaining any loan or accommodation from the 
 bank. 
 
 In support of his proposition, Mr. M. spoke at some length. He adverted 
 to the immense funds of the Government which would pass through this bank, 
 amounting annually to the sum of twenty-five millions, exclusive of the stock 
 owned therein by the Government. We were Centering into partnership, he 
 said, with persons unknown to us, and about to place in their hands the im- 
 mense revenues of the country. It was indispensable, therefore, that the Go- 
 vernment should not only have a strong influence in the bank, but its direc- 
 tors ought to be made independent, and, as far as possible, placed beyond the 
 temptation of betraying their trusts he would make them, indeed, as in- 
 dependent as the judges. Mr. M. quoted examples from many countries 
 in Europe to prove the necessity of giving the Government greater influence 
 in the bank, which, in none of the instances he had cited, had ever been in- 
 jurious to the prosperity of those institutions. 
 
ON^THE GRANT OF THK CHARTER OF 1816. 577 
 
 Mr. CALHOUN replied that his colleague's object could not be effected by 
 his amendment; because, if the directors were precluded from borrowing from 
 the bank, directly, they could borrow in the name and through the medium 
 of some friend. Mr. C. remarked further, that the salary ottered must be 
 very large to induce a commercial man of any standing to forego the benefits 
 of the bank. 
 
 Mr. MAYRANT thought a salary of 3,000 d9llars would be a sufficient in- 
 ducement to men, well qualified for the direction, to relinquish the privilege of 
 borrowing from the bank. After some further observations, in answer to Mr. 
 CALHOUN, 
 
 Mr. MAYRAVTS motion to amend the bill was negatived, without a division. 
 
 The only remaining motion, meriting particular notice, was by 
 
 Mr. ATHERTON, who moved that the rate at which the three per cent, stock 
 
 shall be received for subscription, shall (DC reduced from 65 to 50 per cent. 
 
 Some debate ensued on this motion, which had not concluded, when 
 The House adjourned. 
 
 MARCH 13, 1816. 
 
 Mr. ATHERTON'S motion, to make the rate of subscribing the three per cent, 
 stock, fifty instead of sixty-five per cent, being still under consideration, 
 
 This motion was negatived; and Mr. ATHERTON subsequently moved to re- 
 ceive the three per cent, at sixty, instead of sixty-five percent, which was al- 
 so negatived: Yeas 53, Nays 55. 
 
 Mr. CLENDENIX moved to reconsider the vote of yesterday, which fixed the 
 principal bank at the city of New York. 
 
 This motion produced a debate of some length, and considerable animation. 
 
 Messrs. SMITH, of Maryland, and WRIGHT, spoke in favor of the re-consi- 
 deration, and incidentally urged the claims of Baltimore to the possession of 
 the mother bank. Messrs. HOPKINSON, SERGEANT, CALHOUN, PICKERING, 
 Ross, and INGHAM, likewise advocated the re-consideration, and the claims of 
 Philadelphia. Those who spoke against the re-consideration, and of course in 
 lavor of New York, were Messrs, CONDICT, SOUTHARD, ROOT, TAYLOR, of 
 New York, ROBERTSON, GROSVENOR, GOLD, and HULBERT. 
 
 The question was finally decided in the affirmative, as follows: 
 
 For re-consideration, 81, 
 
 Against it, - 66. 
 
 And the House then struck out " New-York," and replaced Philadelphia. 
 
 Mr. WRIGHT then moved to strike out Philadelphia, and insert Baltimore; 
 which was decided in the negative. 
 
 Mr. ROOT, after observing that the State of New York possesssed a consi- 
 derable portion of United States' three per cent, stock, and wishing, as the 
 Legislature of that State was now in session, if so disposed, to subscribe that 
 stock in the bank, moved to insert the word " States," in the clause permit- 
 ing companies or corporations to subscribe; which motion was agreed to. 
 
 Mr. WRIGHT moved to restore to Congress the power of increasing the 
 capital of the bank to forty-five millions, [the clause which granted to Con- 
 gress the power of increasing the capital to fifty millions, was stricken out, it 
 will be recollected, in committee of the whole.] Mr. W. supported his motion 
 with a variety of remarks on the impropriety of tying up the hands of the Go- 
 vernnient for twenty years, and prohibiting it by charter, from legislating ac- 
 cording to the growth of our population, the wants of the country, &c. He 
 concluded by requiring the yeas and nays, which were refused; and then his 
 proposition to amend the bill was rejected, only nine or ten rising in its favor. 
 
 Mr. WRIGHT, also, moved to strike out the word " individual," in the se- 
 cond line of the third section, and insert the word " citizen," as descriptive 
 
678 BANK OF THE UNITED STATES. 
 
 of those who might subscribe for stock, but the question on the motion was 
 determined in the negative. 
 
 Mr. M'LEAN, of Ky. rose to renew a motion which he had made without 
 success, in committee of the whole, and which he should not again have offered, 
 if he did not conceive that his former attempt had been decided under an incor- 
 rect view of the subject. Mr. M'LEAN then moved the following clause to the 
 bill. 
 
 "Provided, That no branch shall be established in any State, unless such 
 State shall authorize the same by law. " 
 
 Mr. M'LEAN supported his proposition at some length;; showing, by facts, 
 the injury which might result to some States, extensively interested in their 
 own banks, by forcing a branch of the National Bank upon them. This was 
 the case in Kentucky, where the State owned a great portion of the stock of 
 the State bank, which was very prosperous, and its stocks very profitable; and 
 Mr. M'L. said he was unwilling to put it in the power of any twenty-five men, 
 to impose upon that State, without its consent, an institution which might be 
 extremely prejudicial to its interests, &c. 
 
 Mr. CALHOUN replied briefly, that this motion appeared to involve an inqui- 
 ry into the constitutional power of Congress to esablish banks in the States. 
 This was a question which he had wished to avoid on the present occasion, and 
 he should decline saying any thing on it. When the necessity arose for dis- 
 cussing the question, he should be prepared to meet it. 
 
 Mr. M'LEAN'S motion was negatived, without a division. 
 
 Mr. PITKIN then proposed to amend the bill, by ^striking out entirely, the 
 provision which gives the President and Senate the power of appointing five of 
 the directors, and thereby leaving the whole of the direction to be chosen by 
 the corporation. 
 
 Mr. P. went into a general investigation of this question, the arguments on 
 which were so fully given when before the committee. In support of his mo- 
 tion, he said that, with all the interest of the Government in the old Bank of 
 the United States, it appointed none of the directors, yet there was no com- 
 plaint ever heard of the public concerns being mismanaged in that bank. If 
 there was no necessity for exercising the power in that bank, he argued there 
 was none for it in the present one. Neither the safe keeping of its deposites 
 nor the care of its interest in the bank required the Government to possess 
 the power, because there would necessarily always be a close connexion be- 
 tween the bank and the Government, produced by the strongest of motives, in- 
 terest. If the power was not necessary for any useful purpose, he would not 
 Avillingly risk any danger from the possibility of the power being converted in- 
 to an engine of oppression, in the hands of the Government. He argued that 
 it was probable that but few directors would be appointed in Philadelphia by 
 the stockholders; that seven being sufficient to dp business, and the Govern- 
 ment directors being always on the spot, they might frequently constitute a 
 majority of the board, and be able to \yield the bank as they pleased. No 
 man, he was confident, would embark his money in a banking concern, when 
 one of the partners had the absolute appointment of one fifth of the directors. 
 Mr. P. concluded by declaring that, if the provision he objected to was not 
 stricken out, he should be compelled to vote against the bill. 
 
 Mr. CALHOUN rose, not to argue this motion, because it had been fully dis- 
 cussed in committee; but only to express his regret at the determina- 
 tion declared by Mr. PITKIN. He was aware that great difference of 
 opinion existed on this subject, and that great difficulties must be encounter- 
 ed in maturing its details; but he had began to hope, from the concessions 
 which had been made, that gentlemen would reconcile their various views, 
 and that the bill would survive the conflicting opinions under which it started. 
 It was therefore he regretted to hear Mr. P. declare the direction a sine qua 
 non with him. 
 
ON THE GRANT OF THE CHARTER OF 1816. 579 
 
 After a few words by Mr. PITKIN, stating that he had invariably declared, 
 in conversation, that this feature was with him a sine qua non, 
 The question was decided in the negative: Yeas 54, Nays 92. 
 
 Those who voted in the affirmative, are, 
 Messrs. Atherton, Messrs. Hopkinson, Messrs. Pickering, 
 
 Baer, 
 
 Huger, 
 
 Pitkin, 
 
 Boss, 
 
 Hulbert, 
 
 Randolph, 
 
 Bradbury, 
 
 Jewett, 
 
 Reed, 
 
 Breckenridge, 
 
 Kent, 
 
 Ruggles, 
 
 Brown, 
 
 Langdon, 
 
 Sergeant, 
 
 Cady, 
 
 Law, 
 
 Smith, of Pa. 
 
 Champion, 
 
 Lewis, 
 
 Stanford, 
 
 Clayton, 
 
 Lovett, 
 
 Stearns, 
 
 Cooper, 
 
 Lyle, 
 
 Strong, 
 
 Culpeper, 
 
 Lyon, 
 
 Sturges, 
 
 Davenport, 
 
 Marsh, 
 
 Taggart, 
 
 Gaston, 
 
 Mason, 
 
 Tallmadge, 
 
 Gold, 
 
 M'Kee, 
 
 Tate, 
 
 Goldsborough, 
 Grosvenor, 
 
 Milnor, 
 Moseley, 
 
 Vose, 
 Ward, of Mass. 
 
 Hale, 
 
 Nelson, of Mass. 
 
 Wheaton, 
 
 Hanson, 
 
 Xoyes, 
 
 Wilcox 54. 
 
 Herbert, 
 
 I'arris, 
 
 
 Those who voted 
 
 in the negative, are, 
 
 
 Messrs. Adgate, 
 
 Messrs." Goodwvn, Messrs. 
 
 Robertson, 
 
 Alexander, 
 
 Griffin, 
 
 Root, 
 
 Baker, 
 
 Hahn, 
 
 Savage, 
 
 Barbour, 
 
 Hall, 
 
 Sharp, 
 
 Bassett, 
 
 Hammond, 
 
 Smith, of Md. 
 
 Bateman, 
 
 Hardin, 
 
 Smith, of Va. 
 
 Betts, 
 
 Hawes, 
 
 Southard, 
 
 Birdsall, 
 
 Henderson, 
 
 Taul, 
 
 Blount, 
 
 Hungerford, 
 
 Taylor, N. Y. 
 
 Burnside, 
 
 Ingham, 
 
 Taylor, S. C. 
 
 Caldwell, 
 
 Irving, N. Y. 
 
 Telfair, 
 
 Calhoun, 
 
 Jackson, 
 
 Thomas, 
 
 Cannon, 
 
 Johnson, of Va. 
 
 Throop, 
 
 Chappell, 
 
 Keir, Va. 
 
 Townsend, 
 
 Clark, N. C. 
 
 Love, 
 
 Tucker, 
 
 Clark, Kentucky, 
 
 Lowndes, 
 
 Wallace, 
 
 Clendenin, 
 
 Lumpkin, 
 
 Ward, of N. Y. 
 
 Clopton, 
 
 Lyle, 
 
 Ward, of N. J. 
 
 Comstock, 
 
 Maclay, 
 
 Wendover, 
 
 Condict, 
 
 Mayrant, 
 
 Whiteside, 
 
 Conner, 
 
 M'Cor, 
 
 Wilde, 
 
 Crawford, 
 
 M'Lean, Kentucky, 
 
 Wilkin, 
 
 Creighton, 
 
 M'Lean, Ohio, 
 
 Williams, 
 
 Crocheron, 
 Cuthbert, 
 
 Middleton, 
 Moore, 
 
 Willoughby, 
 Thomas Wilson, 
 
 Darlington, 
 
 Murfree, 
 
 William Wilson, 
 
 Desna, 
 
 Newton, 
 
 Woodward, 
 
 Edwards, 
 
 Ormsby, 
 
 Wright, 
 
 Forney, 
 
 Pickens, 
 
 Yancey, 
 
 Forsyth, 
 
 Pinkney, 
 
 Yates 91. 
 
 Gholson, 
 
 Piper, * 
 
 
 Mr. PITKIN then made a motion to reduce the capital of the bank from 
 thirty -five to twenty millions of dollars. 
 This motion was decided, without debate, in the negative. 
 
(580 BANK OF THE UNITED STATES. 
 
 Mr. GOLDSBOROUGH, after a few remarks, moved an amendment, to pro- 
 vide that, if the Government should at any time sell or relinquish its stock 
 in the bank, it should then cease to have the appointment of any part of the 
 directors; which motion was also negatived. 
 
 After rejecting various other propositions to amend the bill, amongst which 
 was a motion of Mr. WEBSTER, to increase the value of the shares to $400, 
 and diminish the number to 37,500, 
 
 The question was taken on ordering the bill to be engrossed and read a third 
 time, and decided in the affirmative, as follows: 
 
 Those who voted in the affirmative, are. 
 
 Messrs. Adgate, 
 
 Messrs. Hawes, 
 
 Messrs. Piper, 
 
 Alexander, 
 
 Henderson, 
 
 Robertson, 
 
 Atherton, 
 
 Huger, 
 
 Sharp, 
 
 Baer, 
 
 Hulbert, 
 
 Smith, of Md. 
 
 Bateman, 
 
 Hungerford, 
 
 Smith, of Va. 
 
 Betts, 
 
 Ing-ham, 
 
 Southard, 
 
 Boss, 
 
 Irving', of N. Y. 
 
 Sturges, 
 
 Bradbury, 
 
 Jackson, 
 
 Taul, 
 
 Brown, 
 
 Jewett, 
 
 Taylor, of N. Y. 
 
 Calhoun, 
 
 Ken-, of Va. 
 
 Taylor, of S. C. 
 
 Cannon, 
 
 King-, of N. C. 
 
 Telfair, 
 
 Champion, 
 
 Langdon, 
 
 Thomas, 
 
 Chappell, 
 
 Love, 
 
 Throop, 
 
 Cilley, 
 
 Lowndes, 
 
 Townsend, 
 
 Clark, of N. C. 
 
 Lumpkin, 
 
 Tucker, 
 
 Clark, of Ken. 
 
 Maclay, 
 
 Ward, of N. J. 
 
 Clendenin, 
 
 Mason, 
 
 Wendover, 
 
 Comstock, 
 
 M'Coy, 
 
 Wheaton, 
 
 Condict, 
 
 M'Kee, 
 
 Wilde, 
 
 Conner, 
 
 Middleton, 
 
 Wilkin, 
 
 Creighton, 
 
 Moore, 
 
 Williams, 
 
 Crocheron, 
 
 Moseley, 
 
 Willoughby, 
 
 Cuthbert, 
 
 Murfree, 
 
 Wm. Wilson, 
 
 Edwards, 
 
 Nelson, of Ms. 
 
 Woodward, 
 
 Forney, 
 
 Noyes, 
 
 Wright, 
 
 Forsyth, 
 
 Pickens, 
 
 Yancey, and 
 
 Gholson, 
 
 Pinkney, 
 
 Yates. 82. 
 
 Grosvenor, 
 
 
 
 Those who voted in 
 
 the negative, are, 
 
 
 Messrs. Baker, 
 
 Messrs. Hale, 
 
 Messrs. Pickering, 
 
 Barbour, 
 
 Hall, 
 
 Pitkin, 
 
 Bassett, 
 
 Hanson, 
 
 Randolph, 
 
 Blount, 
 
 Hardin, 
 
 Reed, 
 
 Breckenridgr , 
 
 Herbert, 
 
 Root, 
 
 Burnside, 
 
 Hopkinson, 
 
 Ross, 
 
 Cady, 
 
 Johnson, of V. 
 
 Ruggles, 
 
 Caldwell, 
 
 Kent, 
 
 Sergeant, 
 
 Clayton, 
 
 Law, 
 
 Savage, 
 
 Clopton, 
 
 Lewis, 
 
 Smith, of Pa. 
 
 Cooper, 
 
 Lovett, 
 
 Stanford, 
 
 Crawford, 
 
 Lyle, 
 
 Stearns. 
 
 Culpeper, 
 
 Lyon, 
 
 Strong, 
 
 Darlington, 
 
 Marsh, 
 
 Tallmadge, 
 
 Davenport, 
 
 Mayrant, 
 
 Vose, 
 
 Desha, 
 
 M'Lean, of Ken. 
 
 Wallace, 
 
 Gaston, 
 
 M'Lean, of Ohio, 
 
 Ward, of Ms. 
 
 Gold, 
 
 Milnor, 
 
 Webster, 
 
 Goldsborough, 
 Goodwyn, 
 
 Newton, 
 Ormsby, 
 
 Whiteside, and 
 Wilcox. 61. 
 
 Hahn, 
 
 
 
ON THE GRANT OF THE CHARTER OF 1816. 
 
 681 
 
 MARCH 14, 1816. 
 
 The bill was read a third time, and the question stated on its passage. 
 Mr. WEBSTER and Mr. CADY delivered speeches at some length against 
 *he b-11, and Mr. GROSVENOR and Mr. HULBERT in favor of it. 
 
 Mr. STANFORD, Mr. C LOFTON, Mr. HANSON, and Mr. PICKERING, also 
 spoke against the bill, and Mr. CALHOUN concluded the debate by a few re- 
 marks in favor of it. 
 
 The question was loudly called for, during the latter part of the sitting; 
 and, being taken at a late hour, the vote was as follows: 
 
 Those who voted in the affirmative, are, 
 Messrs. Adgate, of N. Y. 
 Alexander, Ohio. 
 
 Atherton, N. / 
 Baer, ML 
 Betts, N. Y. 
 Boss, /?. /. 
 Bradbury, Mass. 
 Brown, Mass. 
 Calhoun, S. C. 
 Cannon, Tom. 
 Champion, Con. 
 Chappell, S. C. 
 Clark, N. C. 
 Clark, Ken. 
 Clendenin, Ohio. 
 Com stock. A*. /. 
 Condict, N. J. 
 Conner, Mass. 
 Creighton, Ohio. 
 Crocheron, .V. Y. 
 Cuthbert, Geo. 
 Edwards, A'. C. 
 Forney, N. C. 
 Forsyth, Geo. 
 Gholson, Va. 
 Griffin, Penn. 
 Grosvenor, N. Y. 
 Hawes, Va. 
 Henderson, Tenn. 
 Huger, S. C. 
 Hulbert, Mass. 
 Hungerford, Va. 
 Ingham, Penn. 
 Irving, N. Y. 
 Jackson, Va. 
 Jewett, Vermont. 
 Kerr, Va. 
 King, N. C. 
 Love, A: C. 
 Lowndes, S. C. 
 
 Messrs. Lumpkin, Geo. 
 Maclay, Penn. 
 
 Mason. R. I. 
 McCoy, Va. 
 McKee, Ken. 
 Middleton, S. C. 
 Moore, * 
 Moseley, Con. 
 Mill-free, N. C. 
 Nelson, Mass. 
 Parris, Mass. 
 Pickens, N. C. 
 Pinkney, Md. 
 Piper, Penn. 
 Robertson,, Louisiana. 
 Sharpe, Ken. 
 Smith, Md. 
 Smith Va. 
 Southard, N. J. 
 Taul, Ken. 
 Taylor, N. Y. 
 Taylor, S. . 
 Telfair, Geo. 
 Thomas, Tenn. 
 Throop, A T . Y. 
 Tovwisend, N. Y. 
 Tucker, Va. 
 Ward, N. J. 
 Wendover, N. Y. 
 Wheaton. Mass. 
 Wilde, Geo. 
 Wilkin, N. Y. 
 Williams, N. C. 
 Willoughby, N. Y. 
 Wilson, Trios. Penn. 
 Wilson, Wm. Penn. 
 Woodward, S. C. 
 Wright, Md. 
 Yancey, N. C. 
 Yates, N. Y. 80. 
 
 Those who voted in the negative, are, 
 Messrs. Baker, of New Jersey. Messrs. Bassett, Va. 
 
 Barbour, Va. Bennett, N. J. 
 
 * Thomas Moore was from South Carolina, and Nicholas R. Moore from Maryland, 
 one of whom only voted on this question; but which it was, it is not easy to discover, 
 as they are not distinguished in the Journals by their Christian names. 
 86 
 
BANK OF THE UNITED STATES. 
 
 Messrs. Birdsall, N- Y. Messrs. Lyon, Vermont. 
 
 Bloimt, Tenn. Marsh. Vt. 
 
 Brackenridge, Fa. Mayrant, S. C. 
 
 Burnside, Penn. McLean, Ken. 
 
 Bui-well, Va. McLean, Ohio. 
 
 Cady, N. Y. Milnor, Penn. 
 
 Caldwell t Ohio. Newton, Va. 
 
 Cilley, A. H. Noyes, Vermont* 
 
 Clayton, Del. Ormsby, Ken. 
 
 Ciopton, Va. Pickering, Mass, 
 
 Cooper, Del. Pitkin, Con. 
 
 Crawford, Penn. Randolph, Va. 
 
 Culpeper, N. C. Reed, Mass. 
 
 Darlington, Penn. Root, N. Y. 
 
 Davenport, Con* Ross, Penn. 
 
 Desha, Ken. Ruggles, Mass* 
 
 Gaston, N. C. Savage. N. Y. 
 
 Gold, N. Y. Sergeant, Penn. 
 
 Goldsborough, MiL Sheffey, Va. 
 
 Goodwin, Va. Smith, Penn. 
 
 Hahn, Penn. Stanford,^. C. 
 
 Hale, N. H. Stearns, Mass. 
 
 Hall, Geo. Strong, Mass. 
 
 Hanson, Md. Sturges, Con. 
 
 Hardin, Ken. Taggart, Mass. 
 
 Herbert, Md. Taflmadge, Con. 
 
 Hopkinson, Penn. Vose, N. H. 
 
 Johnson, Va. Wallace, Penn. 
 
 Kent, N. Y. Ward, Mass. 
 
 Langdon, Vermont. Ward, N. Y. 
 
 Law, Con. Webster, N. H. 
 
 Lewis, Va. Whiteside, Penn. 
 
 Lovett, New York. Wilcox, N. #. 71. 
 
 Lyle, Penn. 
 
 So the bill was passed, and sent to the Senate for concurrence. 
 By an analytical arrangement of the vote, the sense of the different States, 
 upon the passage of the tjjpk charter, appears to have been expressed as fol- 
 lows: 
 
 For its passage . Against it. 
 
 New Hampshire, 1 vote. 5 votes. 
 
 Massachusetts, 7 7 
 
 Rhode Island, - 2 
 
 Connecticut, - 2 5 
 
 Vermont, 1 4 
 
 l^ew York, 12 8 
 
 New Jersey, - 4 2 
 
 Pennsylvania, - 6 12 
 
 Delaware, 
 
 Maryland, 4; 3 
 
 Virginia, 8 11 
 
 North Carolina, 9 3 
 
 South Carolina, l 
 
 Georgia, 5 1 
 
 Kentucky, 4 4 
 
 Tennessee, 3 l 
 
 Ohio, - 3 2 
 
 Louisiana - l 
 
ON THE GRANT OF THE CHARTER OF 1816. 
 
 JXSKNATE, 
 
 MARCH 22, 1816. 
 
 The bill from the House of Representatives, to incorporate the subscribers 
 to the Bank of the United States, was taken up as in committee of the whole. 
 The first section having been read-, 
 
 Mr- CAMPBELL stated, as chairman of the Committee of Finance, that, whilst 
 this bill was before that committee, amendments had been proposed to it, but, 
 though a majority of the committee had been of opinion that the bill required 
 amendment, as they did riot entirely concur as to the nature of the amend- 
 ments, they had determined to report the bill without amendment. He 
 was one, he said, who considerd the bill defective. It had been his intention 
 to have this day submitted his views of the bill, and to have moved amendments 
 
 VUVr KJt-'llU.VA^ lil OMVII V ttjr i,O VI AW ItJV'UHkW iwn^ ni.ii.kJX Wkr%*t * v**jv* 
 
 the right at some future moment to give his views of the bill, &c. 
 
 Mr. MASON, oi'N. H. then moved to amend the bill so as to make the propor- 
 tion of the first specie payment on each share ten dollars instead of five, as it 
 now stands. 
 
 This motion gave rise to a wide debate; in which it was supported by the 
 mover and by Mr, K.IXC; and Mr. SANFORD, and opposed by Mr BIBB, Mr. 
 HARBOUR, Mr. TAYLOR, and Mr. DANA. 
 
 The two first of these gentlemen, though they also opposed the amendment 
 on principle, took the broad ground that it would be unadvisable to amend the 
 detail of the bill in unessential particulars, unless it might appear in the Se- 
 nate exceptionable in principle, which it did not to them; they being strongly in 
 favor of it. The debate, therefore, covered the whole ground of the motives 
 and the details of the bill. The debate continued till 4 o'clock. 
 
 No decision took place on the motion of Mr. MASON before adjournment- 
 
 Mr. MASON, of N. H. moved to strike out^/tt'e, the proportion of specie to 
 be paid in at the time of subscription, and in lieulhereof to insert ten: the 
 effect of which motion would be to make the whole^unount of specie paid in 
 at the time of subscription 2,800,000 dollars, instead of 1,400,000. The two 
 great objects proposed by the friends of this bill, he said, were, 1st, to release the 
 country from the mass of spurious paper \yhich was said to be the circulating 
 medium; 2dly, to aid the Government in its finances. To eft'ect the first ob- 
 ject, the bank must commence its operations in specie. To enable it to do 
 this, he proceeded to show, that, in his veiw, a larger proportion of specie was 
 necessary to the first payment. The U. States' stock, subscribable and payable 
 at the same time,to the amount of seven millions, \yould, he said, be no more aid 
 to the bank in discounting, with a view to redeeming its notes with specie, than 
 would so many bank bills. The amount of 1,400,000 dollars in specie, divided 
 among the different branches, which he presumed would be immediately esta- 
 blished, would, he argued, be insufficent for any operation whatever. Let the 
 bank issue paper sufficient to produce any effect, and the specie in its vaults 
 would be instantly withdrawn from them; twenty -five days would be sufficient 
 for that purpose. In Baltimore, Philadelphia, and the District of Columbia, he 
 said, the notes of the bank would be seized on by every individual who has 
 any occasion for specie, &c. the bank, then, to be safe, would be able to issue 
 no more paper than to the amount of its specie paid in. Would such an issue, 
 he asked, serve to reform the currency, or give the Government any aid in its 
 finances? It might be said, the bank would commence operations slowly and 
 with caution: but Mr. M. said, any man acquainted with the institution of 
 banks knows that the sum first paid in is nearly all that the stockholders ever 
 
(386 BANK OF THK UNITED STATES. 
 
 was unnecessary, lie said, to recapitulate the causes which had produced this 
 state of things, but he did verily believe, that, unless the present Congress should 
 take some efficient measure to compel the resumption of" payment of specie, it 
 was extremely doubtful whether it ever would be done. He called the attention 
 of the Senate to the acts of the State Governments; scarcely a session passed 
 in which bank charters were not granted by them, to the amount of millions; 
 and, as the influence of these State banks increased, so did the difficulty of 
 legislating on this subject. Mr. B. then considered the subject in other points 
 of view. At the present moment, he said, the People in the Eastern States 
 pay the revenue to the United States in treasury notes; but the Secretary of 
 the Treasury was making a great effort to call in that species of paper. 
 When that object was accomplished, what would be the situation of the East- 
 ern States? Whilst other quarters of the country were paying their taxes in 
 paper, those banks must either pay in paper as valuable as specie, or in specie 
 itself; the inevitable consequence must be, that the banks of that part of the 
 country must follow the example of all the other banks. All the banks in the 
 country would then be united against a return to specie payment. So far as 
 he had heard, Mr. B. said that the opinion of a large majority of the Senate 
 was, that some course of measures should be adopted for the remedy of the 
 evil; the only question was as to the mode. He had heard but two modes 
 proposed; the one ? to declare by law that, after a certain day, the paper of 
 those banks refusing to pay specie should not be receivable in dues to the 
 Government; the other, to establish a national bank. The first plan, he said, 
 was impracticable; the People cannot pay what they cannot get; besides, that 
 such a measure would cause a combination of the banks, too strong for the 
 Government to overpower. Mr. B. said he would go further; he believed a 
 large majority of the Senate had declared themselves in favor of a national 
 bank; that they had made up their minds that it was the best possible means 
 of restoring the country to the old state of things. Now, he asked, whether, 
 on a question of mere detail, they ought to risk the loss of an object so impor- 
 tant as this bill. Mr. B. asserted to the Senate, and he said he would justify 
 the ground, that, although this bill might not be perfect, he should vote against 
 every amendment of every character; justified in so doing by the importance 
 of the passage of the bill . The honorable gentleman from New Y ork had strongly 
 inveighed against such a course. Mr. B. intimated that it was precisely the 
 course the gentleman himself had taken on the question of the direct tax, at a 
 former session. It had been then admitted, that amendments proposed 
 would make the bill m&e perfect; but their rejection was justified on the 
 ground of the importance of the bill, and the probability that an agreement to 
 the amendments might occasion the rejection of the bill on its return to the 
 other House. That was a correct course, Mr. B. said, and that course he should 
 now pursue. He also referred to a precedent of higher authority the recom- 
 mendation of the convention who framed the constitution, to the People, that, 
 although susceptible of amendment to advantage, the constitution should be 
 accepted as it stood, lest, by the collision of opinion on amendments, it should 
 be lost. The constitution had been accordingly so accepted, and subsequently 
 amended, by adding to it new sections. Mr. B. was against all amendments 
 to the bill. In regard to this particular feature of the bill, it could not, in any 
 view, be of sufficient importance to justify endangering the bill. He denied 
 the justice of the intimation that this was not t9 be a specie bank. Substan- 
 tially, he said, it possessed all the features of the old Bank of the United 
 States, the plan of which gentlemen had so highly approved; with the addi- 
 tion of several important checks not contained in the plan of that bank, the 
 nature of which Mr. B. explained. He vindicated some of the principal fea- 
 tures of this bill, to which, on either hand, objections had been made, parti- 
 cularly that which gave the appointment of five of the directors to the Go- 
 vernment which was due to the interest of the Government in the bank, as 
 well on account of its stock, as of the necessary attention to the security of its 
 deposites. As to its not being a specie bank, if the control of the Government 
 was as powerful as he considered it, it would be the fault of the Government 
 
ON THE GRANT OF THE CHARTER OF 1816. 
 
 alone if it were not a specie bank. We must suppose the Government and 
 the People themselves corrupted, before you suppose that it will not be a spe- 
 cie bank. With the aid of all the Eastern banks, being besides the depository 
 of the revenue of the United States, and thus having all the State banks cre- 
 ditors to it, how could the State banks destroy it? Congress might addition- 
 ally provide that, at some distant day, the notes of banks not paying spe- 
 cie should cease to be received in payment of dues to the Government, &c.; 
 at some distant day, he said, for he was not for destroying or injuring the 
 State banks, &c. Mr. B. concluded his speech by expressing his hope that 
 the Senate would not agree to any amendment to the bill. 
 
 Mr. BARBOUR, of Virginia, next took the floor, and opposed the proposed 
 amendment in a speech of considerable length, of which what follows is but 
 an outline. He, too, like the gentleman from Georgia, considered the question 
 of bank or no bank, as the most important that could be presented to the 
 National Legislature at this session. The rejection of this bill, be believed, 
 would expose us to a continuation of all the inconveniences experienced in 
 every quarter of the Union from the present State of the circulating medium, 
 causing a fluctuation and uncertainty in the value of property and products, 
 greatly to be deprecated: and bringing with it a train of evils it would be al- 
 most imposible to enumerate. On the other hand, he said, he had such confi- 
 dence in the efficacy of a National Bank, in correcting the evils of the mass of 
 paper afloat, in enabling the Government and individuals to fulfil their en- 
 gagements, that he had brought his mind to the conclusion, that the establish- 
 ment ofa National Bank would be an epoch in the affairs of the nation; that, 
 instead of the cloud which darkens the horizon, it will usher in a new day of 
 prosperity, replete with benefits to the nation, &c. With the gentleman from 
 New York (Mr. KINO) Mr. B. said he entirely coincided in sentiment, as 
 to the respect due to public opinion, when distinctly expressed and well under- 
 stood: but why that sentiment was recurred to at the present time, he did not 
 precisely understand: for, sure he was, that,on this occcasion, it had been au- 
 dibly and distinctly expressed, from everv part of the United States, as well as 
 from the Executive authority, in favor of this measure: and above all, it had 
 been recently declared, from an unequivocal source the House of Representa- 
 tives who are the mirror in which the sentiments of the People are reflected, 
 and whose decision on such a topic is a pillar of light, the pursuit of which 
 will never involve us in difficulty. Mr. B. agreed also with the gentleman in 
 his views of the independent duty of this House, in ^viewing the proceedings 
 of the other branch of the Legislature, so far as regarded the absolute right of 
 the Senate to decide, according to their own impressions of the fitness of 
 things, on measures presented to them by the other House; but if the gentle- 
 man meant, that it was a reason for jealousy in regard to any measure that 
 liad passed that House, Mr. B. differed from him toto cselv. On the contrary, 
 he said, that circumstance would be, with him, a persuasive argument in favor 
 of any measure: for, though he would surrender to them no part of the rights 
 of this body, he should perpetually recur to that body, as an oracle from which 
 true responses may be drawn as to the public will, it may err; when it did, 
 in his opinion, he should not feel himself bound by its views, &c. 
 
 Mr. B. then proceeded to the consideration of the great subject before the 
 House. The constitution, he said, had imparted to the Congress, among 
 other great attributes, the power of regulating the coin of the United States. 
 How had Congress accquitted themselves of this duty? Where and of what 
 effect were these regulations? Where was the uniformity of currency? Mr. 
 B. described the variety and fluctuation of value of the paper in circulation,, 
 not only in various States, but in contiguous towns, counties, &c. This 
 was a great evil, deprecated on all hands. The power, intended by the con- 
 stitution to have been lodged in the hands of the General Government, was, 
 by the failure of the Government to make use of it, exercised by every State 
 in the Union, frequently by individuals, &c. Hence arose an excess of paper 
 issues, causing depreciation to an extent which could scarcely be estimated 
 
683 BANK OF THE UNITED STATES. 
 
 an evil which called for a remedy, in a language not to be misunderstood. 
 Where was the antidote, which the Executive, in this, only the organ of the 
 public sentiment, had called on Congress to interpose? The patient, said 
 Mr. B. is sick, from the crown of his head to the sole of his foot; he asks for 
 oil and wine to be poured into his wounds, which would be otherwise fatal. 
 Where is the man who will propose any other antidote than that now before us? 
 Where is the adventurous knight who will suggest another remedy? If there 
 be a Don Quixotte in politics, let him appear. No, Mr. B. said, not even a 
 nostrum had been tendered to substitute this plan. If no other remedy was 
 offered, ought they, he asked, to higgle about details, to split hairs, on the ques- 
 tion? Mr. B. then spoke of the necessity of nrjtual concession among legisla- 
 tors, without which, he said, the idea of legislation was the most vague and 
 illusory that ever entered the human mind. It was necessary, Mr. B. then 
 argued, for the present diseased paper medium, since specie had fled the coun- 
 try, or was scattered in the bowels of the earth, to substitute a medium im- 
 pressed with the seal of the nation, &c. If an institution were established to 
 issue a paper of that description, we should have, he said, in lieu of a medium, 
 the value of which will not live ten, fifteen, or twenty miles from the spot 
 where we receive it, a paper which will embrace the Union in its grasp. It 
 would also be a great financial instrument, necessary to the fulfilment of the 
 national duties in this respect. On this head the experience of the last w r ar 
 spoke a language which incredulity itself could not doubt, &c. In the dark 
 and gloomy period of the last winter, when this subject was disscussed, no 
 doubt had been entertained that this was the only means of remedying an evil 
 from which so much was apprehended. That time, he rejoiced, had passed 
 by; but he hoped the lessons of experience would not be permitted to pass away 
 with the urgency ot the occasion, &c. 
 
 In regard to the details of this bill, he said, he did not see the necessity of 
 amending them. It had been slated that this would be a paper bank, and in 
 order to prevent that, an increase of the specie payments was suggested. Mr. 
 B. believed such an amendment was unnecessary. Being not necessary, 
 what, he asked, would be its effect? It would be to place the bank wholly in 
 the hands of a few fortunate individuals or banks, who had specie in their pos- 
 session. The smaller the first payment in specie vyas made, within the lim- 
 its of necessity to the object, in his opinion, the wiser would be the plan. 
 The establishment of a bank, or any other system, could not be expected to af- 
 ford an instant remedy to the existing evil, any more than a dose of medicine 
 would restore to instant tea 1th and pristine vigor the man who had been wast- 
 ed by long sickness. The effect of this amendment, without accelerating the 
 operations of the bank, would be to favor the monopolists of specie, &c he 
 who had the caution or forecast to hoard up the dollars and cents. The bulk of 
 the specie to be paid into this bank, Mr. B. had no doubt ought and must be 
 drawn from abroad. In regard to the argument that the sum was too small 
 to enable the bank to commence its operations with safety, &c. Mr. B. con- 
 tended that money was too sharp sighted, too lynx eyed in its vigilance to be 
 (using a common saying) caught napping. There was no fear, he said, of the 
 banks bein-g ruined, by lending money to men pressed from other quarters,- the 
 board of direction of a bank formed a barometer in which the responsibility of 
 every man passing before it was as correctly graduated as the weather is by the 
 instrument so called; they would take care, as they always did, not to part 
 with their dollars to accommodate an unfortunate debtor. &c. In answer to 
 the argument of Mr. KING, who, he said, had discovered that this was to be 
 a paper and not a specie bank, and was to aggravate the evils it was intended 
 to cure, Mr. B. referred to the regulations by which it was governed to show 
 that this apprehension was unfounded. Besides, he said, the bank would not 
 disregard its interest, which required it to continue specie payments. You 
 need not fence in the interest ot this institution, said he; you might as well 
 pass a law to compel your Secretary to receive his salary; interest is the 
 strongest security which man can give to man. As the needle acknowledges 
 the principle of polarity, so does the human heart always point to its interest 
 
ON THE GRANT OF THE CHARTER OF 1816. 539 
 
 That objection against this bill, therefore, seemed to Mr. B. to be a chimera 
 from which nothing was to be apprehended. 
 
 It was no question now, he said, whether banking should exist that being 
 beyond the control of Congress; but whether it was proper that a portion of 
 it should be placed under the authority of the General Government, instead ot 
 its being wholly under the control ot the States, who established banks not 
 only in their populous towns, but even in the dreary wilderness. I his being 
 the only question, he solemnly appealed to gentlemen whether there could be 
 two opinions on that point. " Ought this great attribute ot sovereignty to be 
 surrendered by this Government to the authority of the State Legislatures? 
 This question he answered in the negative. The existing evil, he then argued, 
 would be remedied by the establishment of a bank, whose influence was ramm- 
 ed into every part ot the United States. The State banks had nothing to fear, 
 if they would conduct themselves properly, from such an institution, If any of 
 them, on the other hand, should violate their trust, and shew a centrifugal 
 quality, it would be in the power of this great orb to restore them to their 
 proper stations. If any of the State banks do not fulfil their engagements, 
 Mr. B. said, if they do not meet the occasion, their paper will sink into dis- 
 repute. This bank will be the silent and efficient remedy; it will move on 
 almost imperceptibly, gradual in its approach, but certain in its effects. Mr. 
 B. took this occasion to vindicate the banks in the commonwealth of Virginia 
 from the charge it had been fashionable to make against the State banks, oiim- 
 providence in their administration. Those banks resisted to the utmost the 
 attempts to procure loans from them; that which they had, with great reluct- 
 ance, from a sense of duty refused to the Government, their patriotism at 
 length induced them to grant to the wants of thousands of men surrounding 
 their capital, who, but for their relief, would have greatly suffered, &c. Where 
 banks had wantonly abused their privileges, he cared not what was said of 
 them; but he felt no disposition to put those under the ban of tHe empire who 
 had acted thus correctly, &c. 
 
 In regard to objections he had heard to the influence of the Government 
 over this bank, Mr. B. said his objection was, that it had not interest enough 
 in it; but in this respect, as in others, he was willing, to obtain a great object, 
 to concede some part of his views. He recurred to the experience of his own 
 State to shew that no evils had been experienced from the existence of such 
 a control to a much greater extent than proposed in this bill, &c. No banks, 
 he believed, had been better conducted, or stood higher in the public opinion, 
 than those of Virginia. If the bank were a faithful one, it had nothing to ap- 
 prehend from the appointment, by the Government, of one-fifth of its direc- 
 tors, to which proportion the Government was entitled by the interest it would 
 have with the bank. 
 
 Having thus briefly touched on all the objections he had heard to the bank, 
 Mr. B. concluded by recapitulating his arguments, and expressing his hope 
 that the only remedy, as he believed, for a great evil, would be agreed to. 
 
 Mr. MASON, of New Hampshire, spoke in support of his motion to amend 
 the bill. He, certainly, hael entertained no expectation, he said, when he 
 submitted the motion, that it would have drawn the bill into so general a dis- 
 cussion. Whenever a national bank had been proposed, he said, he had al- 
 ways supported it,with such modifications as he thought correct. He did believe 
 a well regulated institution of this kind would be useful to the Government; 
 and, though the Government had, at a certain period, declined the exercise of 
 its power in this respect, he felt no inclination to prevent them from again oc- 
 cupying the ground of the old United States' Bank. He was. he said, now 
 willing to give his aid in establishing a bank on proper principles; but, he ne- 
 ver could assent to this, or any other measure, on the ground taken by the 
 gentlemen from Georgia and Virginia. The bill was, according to the forms 
 of the Senate, read section by section, for the purpose of amendment; and 
 yet gentlemen declared they would not listen to any proposition to amend 
 the bill, but take it as it stood. [Mr. BIBB explained that his remark was con- 
 87 
 
590 BANK OF THE UNITED STATES. 
 
 fined to unessential amendments.] It might, Mi-. M. said, be difficult to de- 
 fine what makes an amendment important: for him, it was sufficient reason 
 for an amendment, that the bill would be better with than without it. He 
 could not, he said, seethe force of the objection fo sending this bill back to the 
 House of Representatives better than it came from them: gentlemen must 
 certainly conclude that that House was greatly in love with a bad bill. It had 
 always been held irregular to suggest, in one branch of the Legislature, what 
 might have passed in debate in the co-ordinate branch; it was certainly, Mr. 
 M. said, more improper to go into a wide field of conjecture to find out what 
 would happen there. Although there might be good reasons for concession 
 and accommodation to the views of the other House, Mr. M. said they had 
 not yet arrived at that stage of the business when it was necessary; which 
 was not until the House should refuse to accept the amendments of the 
 Senate. It was a dangerous ground to assume, Mr. M. added, that the House 
 of Representatives would vary their ground on this question. Although he 
 had as much respect for them as he ought, he also remarked, he should not 
 take public opinion from the Representatives of the People. The constitu- 
 tion prescribed to the Senate no such practice. The course of taking mea- 
 sures from the popular branch of the Legislature, believing them proper be - 
 cause it has adopted them, precludes all legislation, &c., and is, therefore, 
 inconsistent with the principles of our Government. 
 
 Mr. M. agreed that the public suffered much inconvenience from what was- 
 termed the state of the public medium; it was not very material whether it was 
 produced by what the gentleman from Georgia had termed swindling, or 
 what the gentleman from Virginia had called the patriotic conduct of the 
 banks. Mr. M. replied to other arguments used by the gentlemen who had 
 opposed his motion. In regard to the operation of interest on moneyed insti- 
 tutions, he said, he believed that principle was felt as much by the State 
 banks as by that which it was now proposed to incorporate. Any bank, guid- 
 ed by other motives, would depart from the objects ot the institution. Mr. M. 
 attached no sort of consequence to the idea of the passage of this bill, in order 
 to exercise the power of the Government, to regulate the coin of the country. 
 The laws of the United States, he said, had already regulated it: he knew of 
 no law which authorized any officer of the Government to receive any part 
 of this spurious money, which the gentleman said was in circulation. The 
 laws were already perfect on this subject. If the executive officers had re- 
 ceived other moneys in payment than those authorized by law, Mr. M. said 
 they had acted without law, without right. What necessity there might have 
 been for their doing so, he would not now examine. Cases might arise, in 
 which the officers of the Government may take upon themselves the responsi- 
 bility of neglecting the execution of a law, &c. That an evil existed, he said, 
 all agree, and all suppose that the bank to be incorporated by this bill will, in a 
 greater or less degree, lessen the evil, or entirely correct it. The object of his 
 motion was to give the bank the greatest possible power, to effect these pur- 
 poses. It had been said, that the bank would at first move slowly. But, Mr. 
 M. said, he had no sanguine anticipation that this amendment, or any other, 
 or the prudence of the directors, would be able wholly to cure the evil. What 
 had been the cause of the evil? The banks themselves. Banks incorporated 
 under the same restrictions as this bill contained, issue now the very rags 
 which had been described. The remedy now proposed, was, Mr. M. thought, 
 something like Sangrado's practice: more bank paper of the same sort more 
 hot water for the same evil. In regard to the impossibility of this bank's do- 
 ing any thing but a specie business, Mr. M. undertook to assert, that the 
 charter, in its present shape, gave the bank the power to issue notes, without 
 even promising payment of specie. The clause which authorizes the bank to 
 issue notes, did, in fact, for the want of due restrictions, authorize the bank to 
 issue notes payable when it pleased; none but notes payable on demand were 
 indeed receivable in payment of taxes to the Government; but they^ might be 
 issued payable twc 
 circulate quite as 
 
 issued payable two years after date for other purposes, and would probably 
 .s well as the notes of New York, Philadelphia, and Balti- 
 
ON THE GRANT OF THE CHARTER OF 1816. 
 
 more. He should imagine, he said, that, as the bank was now constituted, 
 sensible men having the management of it, would not attempt to do business 
 without taking that course. Mr. M. pointed out other detects, as he viewed 
 them, of the bill. There was no provision fora forfeiture of the charter ot 
 the bank, or for annulment on failure of its going promptly into operation. 
 However, it would be idle, he said, to discuss thel>ill, \i the opinions of the 
 gentlemen from Georgia and Virginia were to prevail with the majority of the 
 Senate, that it would be dangerous to amend the bill, lest it should fail there- 
 by. If this was the opinion of the Senate, the sooner they came to that deter- 
 mination the better; it would save them labor, and perhaps character, to de- 
 cide the question at once. The same argument might be urged, he said, with 
 as much propriety every day, and on every subject, as had been principally 
 urged against the amendment. 
 
 Mr. DANA, of Connecticut, said he did not expect to vote for the bank bill 
 in its present form; but, notwithstanding, he did not think it vyould be proper 
 to adopt this amendment. One-twentieth part of the whole capital appeared to 
 him to be as large a proportion as ought to be called for in specie at the time ot 
 subscription. If danger were anticipated from the smallness of the amount of 
 specie, it would perhaps be better to introduce into the bill a provision, that 
 the bank should not issue paper until it had a sufficient quantity of coin to jus- 
 tify it in so doing. Though he should riot vote for the bank, he should regret 
 to see its first issues to individuals who were connected with the institution: 
 indeed, he should rather suppose, the great demand for discounts from the 
 bank, would be to enable the merchants to pay bonds, constantly falling due 
 to the Government lor customs. These merchants, for their notes, will obtain 
 credits at the bank, to tin 1 amount of perhaps seven, eight, or ten millions, in 
 the course of the year. The United States will be the only power that can 
 cull for it; and Mr. U. presumed there would be no danger of a run on the 
 bank from the Government, &c. 
 
 Mr. TAYLOR, of South Carolina, said, he should have liked to have heard 
 (he amendment argued on its own merits, because the force of the argument 
 against, would perhaps be weakened by connecting it with other considera- 
 tions which had been brought into debate. If he approved of the amendment, 
 he would vote for it, though he would say, that, for a small or inconsiderable 
 alteration, lie would not jeopardize a great principle or a great measure, such 
 as he conceived this bill. With respect to the proposed amendment, consi- 
 dering the state of the currency of the country, and the known fact that specie 
 abounds in some parts of the country, whilst in others it is not to be obtained 
 at all; to carry the gentleman's atnendmentmore directly to what would be its 
 absolute result, he ought first to have provided for confining the opening of the 
 books of subscription to that part of country where specie is in a state of cir- 
 culation. Without designing it, for he would not certainly impute such a de- 
 * ; ign to the gentleman, the adoption of this amendment would be giving a 
 complete monopoly to the Eastern country. Believing it desirable that the 
 benefits of this institution should be extended to every part of the country, he 
 was, therefore, opposed to the amendment. The restoration of specie pay- 
 ments, Mr. T. said, was not the work of a moment. The power to sell two 
 millions of its stock in the first year, of which the bank would no doubt avail 
 itself, and the depositesof the Government, together with the specie paid in en 
 the subscription, would, he said, enable the bank to operate to as great an ex- 
 tent as was advisable. This amendment, besides being unnecessary, would, 
 he believed, produce an undue monopoly to one section of the country, and to 
 the hoarders, where specie was not current. It is calculated to reward those 
 whose conduct has had a tendency to bring about the very evil now proposed 
 to be remedied. The amendment would also throw advantages into the hands 
 of the capitalists of Charleston, &c. which it would deny to those of the middle 
 country; for it so happened, in the course of trade, that specie was reduced in 
 there value, to about from two and a half to five per cent, above the current 
 
592 BANK OF THE UNITED STATES. 
 
 paper of that State, not more than in ordinary times used to be given for specie 
 in quantities. For these general reasons, Mr. TAYLOR was opposed to the 
 amendment, &c. 
 
 Mr. MASON, of New Hampshire, remarked, that specie was not confined to 
 the Eastern or Southern States; the banks in the middle States still retain as 
 much specie as they ever had. If the bank might sell stock for specie, why 
 might not individuals do the same, in the first instance, and pay it into the 
 bank? United States' stock would, at a certain price, command specie any 
 where, &c. 
 
 Mr. SANFORD spoke in support of the proposed amendment, denying the 
 correctness of the doctrine on which opposition was made to any amendment 
 of this bill. It was a subject, he said, which particularly required caution 
 and circumspection in deciding upon it. He considered the amendment be- 
 fore the Senate as presenting this question: With what sum shall the bank 
 commence its operations? This being intended to be a specie bank, Mr. S. 
 said, every proposition tending more certainly to make it more so, was wor- 
 thy of favorable consideration. The bill, as it stood, contemplated $1,400,000 
 in specie, as a sufficient basis for the bank to begin upon. Mr. S. said he 
 could not but think, with Mr. MASON, that this sum was too small. There 
 was nothing in the bill to prevent the bank from issuing thirty-five millions of 
 dollars on this amount of specie paid in, if they thought proper to do so. 
 Those who were called on to pay the second instalment in specie, would, he 
 said, go to the bank with its bills, and drain it at once of every dollar. The 
 bill was, Mr. S. thought, in other respects, deficient in detail, as he showed 
 by reference to its provisions. The bank would get no specie but what it re- 
 ceived in the first payment, unless the course of exchange should become 
 more favorable, or the state of things generally should essentially vary. The 
 rational and prudent course, he thought, would be, to require as much specie 
 as possible in the first instance. Without amendments to regulate the paper 
 issues of the bank, &c. this would be a mere paper bank, he said, like those 
 which already exist- The amendment appeared to him extremely proper, 
 and therefore he should vote for it. 
 
 Mr. TAYLOR replied to Mr. SANFORD, and quoted the provisions of the 
 bill to show, that the bank dare not issue one dollar more paper than it had 
 a reasonable prospect of being able to honor with gold or silver. The bank 
 had the power to do otherwise, it was true; and so have we power to cut our 
 own throats but the bank is no more likely than we are, to commit afelo de 
 se. As to the second instalment being paid with the specie of the first, Mr. 
 T. said, it was impossible to pay $2,800,000, (the amount of the second in- 
 stalment) with $1 ? 400,000, (the amount of the first) and at the worst, there- 
 fore, only one half of the second instalment could be drawn from the vaults 
 of the bank, &c. 
 
 The Senate then adjourned, leaving the pending question undecided. 
 
 MARCH 26, 1816. 
 
 Mr- MASON, of N. H., withdrew the motion he had yesterday made, with 
 a view hereafter to renew it; and moved to amend the bill in the part which 
 authorizes the bank to issue notes payable, by adding thereto the following 
 proviso: 
 
 "Provided, That all bills or notes so to be issued by said corporation, shall 
 be made payable on demand, other than bills or notes for the payment of a 
 
 sum not less than dollars each, and payable to the order or some person 
 
 or persons, which bills or notes it shall be lawful for said corporation to make 
 payable at any time not exceeding days from the date thereof." 
 
 This motion gave rise to considerable debate between those who thought 
 
ON THE GRANT OF THE CHARTER OF 1816. 593 
 
 such a restriction necessary, and those of a different opinion. It was at length 
 agreed to, by yeas and nays, 20 to 14. 
 
 This decision in favor of one amendment, opened the door to the proposi- 
 tion of a great number of amendments. 
 
 The discussion of one or two that were proposed to-day, occupied the Senate 
 until the hour of adjournment. 
 
 MARCH 27, 1816. 
 
 The consideration of amendments was resumed. An amendment was adopt- 
 ed, amomg others, to postpone the opening of the books from the 1st day of 
 June to the 1st day of July. 
 
 Mr. MASOX, of N. II., then moved another amendment, by way of a new 
 section, to declare the act null and void if the bank is not put into operation 
 within one year after its date. 
 
 Mr. BIBB moved to amend this amendment so as to make it reserve to Con- 
 gress the right to annul the charter, at any time within twelve months after 
 the 1st day of February next, if the bank be not put in operation before that 
 day. 
 
 These motions gave rise to much desultory debate, as indeed did all the 
 amendments proposed. 
 
 Mr. BIBB'S motion was agreed to; and Mr. MASON'S proposition, so modi- 
 fied, was also agreed to. 
 
 Mr. CAMPBELL then moved to amend that part of the bill which directs books 
 to be opened at certain places, so as to assign to each State a certain propor- 
 tion of the stock to be subscribed, to remain there for a certain time, to allow 
 it to be subscribed in the States, respecti*dj, in proportion to their represen- 
 tation; intending to follow up this amendment by a motion to introduce a pro- 
 vision that the bank should be compelled, on the request of the Legislature of 
 any State, to establish a branch of the bank therein. 
 
 Jn support of this motion, Mr. C. made a speech of some length on the gen- 
 eral principles of the bill. 
 
 This amendment was, in the end, negatived, by a vote of 20 to 11. 
 
 Late in the day the consideration of the bill was further postponed till to- 
 morrow. 
 
 MARCH 29, 181 C. 
 
 Mr. MASON, of N. II. moved to insert, at the end of the 17th section of the 
 bill, the following: 
 
 "And if the said corporation shall, at any time, suspend, or refuse pay- 
 ment, in gold or silver, of its notes, bills, obligations, or other debts, to such 
 an amount, and for such length of time, as Congress may deem injurious to 
 the United States, in such case. Congress may repeal this act, and abolish the 
 said corporation, and make such regulations and provisions tor the settlement 
 of the affairs, and payment of the debts of said corporation, and for distri- 
 buting its remaining property among the stockholders, as shall be deemed just 
 and proper." 
 
 It was determined in the negative: Yeas, 14, Nays, 17. 
 
 MARCH 30, 181 C. 
 
 Mr. KING moved to strike out that provision in the bill which gives to the 
 President the power of appointing five of the directors. 
 
 On this motion a debate ensued, which continued until about three o'clock, 
 and in which Mr. KING and Mr. GORE advocated, and Mr. BIBB, Mr. BAR- 
 BOUR, Mr. ROBERTS, and Mr. CAMPBELL opposed the motion. 
 
 The amendment was finally negatived ayes 14, noes 21. 
 
 A new section was then offered by Mr. GOLDSBOROUGH, in the following 
 words: 
 
694 BANK OF THE UNITED STATES. 
 
 " And be. it enacted, That, if at any time the United States shall cease to hold stock 
 in this bank, the five directors, on the part of the United States, and the- power herein 
 given to the President, by and with the advice and consent of the Senate, to appoint 
 directors, shall immediately cease; and that, for every million four hundred thousand 
 dollars of said stock which the United States may part with, there shall be an abridg- 
 ment of the power of appointing one out of the five directors hereinbefore provided 
 for." 
 
 On this amendment a debate took place, in which Mr. GOLDSBOROUGH, Mr. 
 KING, Mr. HARPER, Mr. MACON, and Mr. FROMENTIN supported, and Mr. 
 BIBB, Mr. CAMPBELL, Mr. TAIT, Mr. TAYLOR, and Mr. CHASE, opposed it. 
 
 APRIL 1, 181 G. 
 
 The Senate resumed the consideration, in committee, of the bill. The 
 amendment offered by Mr. GOLDSBOROUGH, on Saturday, still before the 
 committee. 
 
 Mr. MASON, of Va., Mr. BIBB, and Mr. TAYLOR, spoke against the amend- 
 ment; and Mr. GOLDSBOROUGH in its favor. When the question was taken, 
 and the motion negatived: ayes 16, noes 18. 
 
 Mr. HARPER moved an amendment, limiting the selection of directors by 
 
 the President, to such as held stock to the amount of dollars, (10,000 
 
 was named by the mover) and that, they should cease to be directors when 
 they ceased to hold stock to that amount. 
 
 This motion was supported by Messrs. HARPER, DANA, and TAYLOR; and 
 opposed by Messrs. ROBERTS, BARBOUR, MACON, CAMPBELL, and FROMEN- 
 TIN; and negatived: ayes 9, noes 23. 
 
 Mr. KING moved an amendment, preventing directors appointed by (he 
 Government, from acting as agents or proxies of any stockholders. 
 
 Mr. KING spoke in favor of, and Messrs. ROBERTS nr.il CAMPBELL against, 
 this amendment; which was negatived without a division. 
 
 On motion of Mr. BIBB, an amendment was adopted, requiring that there 
 should not be more than thirteen, nor less than seven directors, to each 
 branch bank. 
 
 Mr. TAYLOR proposed an amendment, making the stock of the United 
 States unalienable. Mr. CAMPBELL spoke against it. Negatived: ayes 10, 
 noes 18. 
 
 Mr. BROWN offered an amendment, excluding the United States, as a stock- 
 holder, from being represented in the choice ot directors, &c. Agreed to. 
 
 Mr. WELLS moved the postponement of the bill to the next session, and 
 prefaced his motion with the following speech: 
 
 Mr. PRESIDENT: The Senate having gone through the different amendments 
 which have been before them, and it not being probable that there are many 
 more, if any other, intended to be brought forward, the proper period for sub- 
 mitting a proposition, which will fairly bring into notice the general views of 
 this subject, has, perhaps, now arrived. In support, then, ot the proposition 
 of postponement to the first Monday in December next, of the further con- 
 sideration of this bill, which I propose to move you, I beg the indulgence of 
 the Senate, while I endeavor to show: First, that it trancends the constitu- 
 tional power of Congress to pass a bill, containing the provisions which this 
 does: Secondly, the inexpediency of enacting such a law as this, even it we 
 possess the constitutional power to do it: Arid, thirdly, that our true policy is 
 to avoid, at this time, legislating upon the subject to pass no law, at the pre- 
 sent session, incorporating a banking compary. 
 
 That which has heretofore been the occasion of so much heated controversy, 
 was simply a question relating to the existence or non existence of a power 
 in Congress to incorporate a company for establishing a bank. That question 
 is now r at rest nor do I purpose to disturb it. The sole inquiry we now have. 
 
ON THE GRANT OF THE CHARTER OF 1816. (3Q5 
 
 to make, is, as to the true character and just extent of this authority, that we 
 may not, in the exercise of it. cany it beyond its proper limits. 
 
 The power that is granted, is a power to establish a bank for a particular 
 end, and of course, constitutes only a part of the general power, in relation to 
 the establishment of banks, that previously existed in the States. For this 
 i it is a power of a minor character to that of the States, and is to be 
 exercised, always, with a steady and distinct view to the end for which it is 
 created. So far as it goes, it is a lawful power, and has a right to pursue its 
 prescribed course. It may keep company with the State authority, but has no 
 right to quarrel, and slay its companion on the road. Every application, 
 then, of this power, by the United States, which has a tendency to embarrass 
 or impair the free exercise of the power reserved to the States, is unwarrant- 
 ed, and, if (lone by us, with a view to such a purpose, is the affair of arrogance 
 and usurpation. 
 
 This is not primary, expressed, original power. In vain, as such, do we 
 seek for it in the constitution. It is only a secondary, an implied, derivative 
 power, if such may be properly termed the mean of executing an expressly 
 delegated power. Mere it may fairly be asked, why was this power left to 
 implication? Did it escape notice? \Vasit overlooked? Was it too unim- 
 portant for enumeration? Kvery view of this subject, and every relation in 
 which it can be placed, to the other authorities, affords an inference not easily re- 
 sisted, that a grant of this power was not intended to be applied. If the express 
 grant of such a power was moved, the silence of the constitution, as to that 
 power, proves that it musth ive been rejected. I understand that it was mov- 
 ed in that body, and was rejected. If this was actually the case, (as I am per- 
 suaded it was) it certainly requires the utmost effort of ingenuity to prove 
 that this power was left to implication, in order thai the subordinacy of its 
 character might be the more clearly e>ta!>lished. and the arrogance of its pre- 
 tensions the more easily repressed. This is all, if it be not a great deal more, 
 than any fair mode of interpreting the constitution, as we have it, will warrant. 
 We cannot, for a moment, suppose that the great men, who formed this frame 
 of Government, were unacquainted with, or unmindful of, the imposing cha- 
 racter of this power, or of its history here or abroad. Did they not know that 
 a proposition to incorporate a banking company, by the old Congress, had been, 
 by that body, rejected? And, furthermore, could those grave and learned men 
 have been unaware (if they intended this power to he inferred as a mean of ex- 
 ecuting another power) of the arduous, perhaps I might be permitted to say, the 
 odious character of the task they devolved upon implication? Did not that 
 enlightened body know that grants of specially enumerated authorities would 
 not warrant the exercise of a power, as a mean for carrying into effect another 
 power, where the mean itself is, in character and importance, entitled to rank 
 with some one of the enumerated authorities? That such is the real character 
 of the mean in question, in relation to some of those authorities, even limited 
 and circumscribed as it may be, I am obliged to admit, there is too much rea- 
 son for insisting. That I have a doubt, therefore, on my mind, on this point, 
 I am free to confess. It is possible, perhaps it is probable, if the vote 1 
 am to give upon this bill, demanded of me, in respect to that difficulty, a de- 
 cision that further deliberation, aided by the authorities, which, I am told, 
 support the opposite opinion, might remove that doubt. 
 
 Sir, I conhdently rely upon the cheerfulness with which honorable gentle- 
 men, who have heretofore so strenuously denied the exigence of the power in 
 question, in this Government, will accompany me in the inquiry respecting the 
 extent of this power. It is agreed, on all hands, to be (not an original, substan- 
 tive) but a derivative, incidental power. What, then, is the specially enume- 
 rated power to which it is incident, as one of the " necessary anil proper" 
 means for its execution? 
 
 Is it incident to the power to "promote the general welfare?" The capa- 
 cious character of this provision, if it is to be viewed simply as a grant of 
 power, would render the subsequent enumeration of special powers a matter 
 of supererogation. The terms "general welfare," when used in the consti- 
 
(596 BANK OF THE UNITED STATES. 
 
 lution, can only be considered as having themselves reference to one of the 
 great objects for the promotion of which this Government was established, and 
 for the accomplishment of which the special powers, contained in the constitu- 
 tion, have been delegated. 
 
 Is this authority to establish a bank, an incident to the power of Congress 
 " to borrow money on the credit of the United States," by reason of its cor- 
 relative tendency in procuring a faculty to lend? If this be the source from 
 which it is lawfully derived, we need look no further for the origin of this or 
 of any other authority. If this be its fountain-head, we have here a never-fail- 
 ing spring of power, abundantly sufficient for all the purposes, lawful or unlaw- 
 ful, of this or of any other Government upon earth. I turn away from it, there- 
 fore, without further investigation. 
 
 Is this power derived from that of coining money, regulating its value, and 
 that of foreign coin? Is the right to establish a national bank, on account of 
 its tendency, in our hands, to operate upon what is called the currency of the 
 country, derived from this, or any other specially delegated authority? There 
 are two provisions in the constitution, which have some bearing upon this point. 
 That to which I have just referred, respecting coin ; and that which prohibits to 
 the States the issue of " bills of credit, and the declaring of any thing but gold 
 and silver a lawful tender in the payment of debts." It cannot be necessa- 
 ry to argue that a power to make a bank, distinctly with a view to its putting 
 into circulation promissory notes, that shall have the faculty of mixing and 
 keeping company with the currency of the country, and of becoming some- 
 thing like paper money, is not a necessary and proper auxiliary to the power 
 in this Government ot making a metallic medium; that a power, in short, to 
 make a metallic money has not incident to it, as a " necessary and proper" 
 mean for its execution, the power to make & paper money. Nor need any time 
 be spent in resisting an inference, drawn from a restraint imposed upon a 
 particular power in the State Governments, which affects to communicate to, 
 and to set up in, this Government, a faculty co-ordinate with another power, 
 which is left in those Governments, free and unshackled. So far then as 
 honorable gentlemen say this measure is intended or calculated, whether with 
 a view to regulation, or improvement, or under any other pretence, to operate 
 upon what is called the national currency, or, in other words, to restrain the 
 States from establishing similar institutions, and impair the free exercise of the 
 franchises of those they have already incorporated, it is warranted by no part 
 of the constitution. 
 
 I come now, sir, to that part of the constitution, where alone can be found, 
 if any where, the lawful source of this Government, to incorporate a banking 
 company. We have the power " to lay and collect taxes, duties, imposts, 
 and excises," for certain great national purposes. It is now admitted, by most 
 of the former opponents of this doctrine, that the establishment of a national 
 bank is nothing more than the employment of a "necessary and proper" mean 
 "for carrying into execution" the power to which I have just referred. The 
 correctness of this doctrine, I have before declared it not to be my purpose to 
 call into question. This part of my argument is entirely predicated upon its ad- 
 mission; and is designed solely to be confined to those views of the subject, 
 which will show the true character and just extent of this authority; and en- 
 able us to determine whether we are not carrying it, by the provisions of the 
 bill now on our tables, further than is warranted by the constitution. This, 
 then, being the power, to which the authority to establish a bank is incident, 
 as a * 4 necessary and proper" mean for its execution, we cannot have much 
 difficulty in the definition of its limits- Its effect upon this power must be in 
 relation to the collection, the safe keeping, and transmission of the public re- 
 venue. The notes which a bank issues may (but, by the by, the affairs of a 
 bank may be mismanaged and they may not) provide the People with an equal 
 medium for the payment of their public dues to this Government. This is, 
 to a certain extent, to operate upon the currency: it is not merely to afford 
 the People, in their relations with the Government, something more portable 
 and convenient to procure, and keep, and pay, than metallic money, but it is 
 
ON THE GRANT OF THE CHARTER OF 1816. (597 
 
 to provide them with a medium of contribution, at a time when the metallic 
 medium shall disappear from circulation. Here provision in relation to the 
 currency generally* would seem, at first, to be intended for an event like that 
 of the disappearence of the metallic medium; but we must always remember 
 that our power, in relation to the medium of circulation, refers solely to a 
 metallic medium; and of course excludes the other -expressio unius c.st exclu- 
 sio aJ terms. If it be not questioned how far, in this point of view, as con- 
 nected with the currency, (a subject, as before mentioned, expressly legislated 
 upon) there is a power to procure, for the People, these kind of facilities, for 
 the payment of their taxes, surely the power must, in this respect, confine it- 
 self directly to this end. What then is the capital necessary for constituting 
 a bank to answer this purpose? This ought to have been shown us. Those 
 who have no warrant to employ this power, but distinctly with a view to the 
 attainment of a particular end, must have known that the purposes for which 
 alone it can be lawfully used, prescribe the limitations to its exercise. The 
 moral obligation imposed upon them not to exceed those limits, requires, 
 likewise, that they should ascertain where they were placed. If there has 
 been an inquiry made upon this head, what principles have guided that inquiry? 
 and which of them have been presented to the Senate? What calculations 
 have been submitted to us, to shew that, in respect to the capital, we are not 
 exceeding the pale of our authority? The hazard of excess must not be in- 
 curred, while there are any means, at our command, ot ascertaining how it 
 may be avoided. It is not for those of us who think it, at this time, inexpedi- 
 ent to establish a bank, to show where the excess is. It is incumbent upon the 
 friends of this bill, who call upon us for our votes, who desire that we should 
 keep them company, to prove to us that they are going no further than they 
 ought to go. This they have not done. It has not been affirmatively proven to 
 us that a capital to this amount is necessary; and for one, I think it can be 
 demonstrated that a capital of thirty-five millions is larger than is required, 
 for the purposes for which we are to establish a bank- A capital much lower 
 than even twenty millions, would be adequate to the establishment of a bank, 
 in each State in the Union, and the objects of safe keeping, and easy trans- 
 mission of the public revenue, accomplished. The capital of this bank, with a 
 view to the effect of its notes, in affording an equal medium for the payment 
 by the People, and the receipt bt the Government, of the public dues, is not 
 to be inquired into, with a view To any given state of things. The charter is 
 to last for twenty years. If this capital, during that period, should be likely 
 to become too small, the power to raise it by our own, or other subscriptions, 
 may be reserved. If we have a view, in ascertaining the proper extent of this 
 capital, to periods when the preservative of a metallic medium shall be with- 
 drawn from the paper circulation, then this capital, (if the bank is to be what 
 its advocates insist upon it to be their intention to render it, a specie paying 
 bank) is unnecessarily large. Its issues, in such times, must be limited, not 
 by the amount of the public revenue, but, by that of the specie in its vaults. 
 If our attention, however, is principally directed, as to me it seems it ought 
 to be, to the usual and natural state of things, when the presence of the me- 
 tallic medium will afford to the paper currency a free and uninterrnpted cir- 
 culation, then a much smaller capital than that of thirty -five millions, in such 
 a state ot things, would enable the bank, by the successive issues and returns 
 of its paper, to afford to the People and to the Government the desired facili- 
 ties. The process between the Government and the People is that of payment 
 and disbursement; and the steady and uniform succession of these operations, 
 which can never be disturbed, communicates to a paper medium, even in a 
 higher degree, the well known faculty belonging to a metallic medium, of trans- 
 acting a large amount of business with a small amount of money. In this 
 view of the subject, can there be a question whether a much smaller capital 
 would not afford every lawful facility that the revenue operations of this Go- 
 vernment require? A capital of ten millions successfully accomplished this 
 object, and with the aid of three or four millions of other banking capital, con- 
 jointly with the metallic medium, circulated the whole business of the Govern - 
 83 
 
(396 BANK OF THE UNITED STATES 
 
 tution, can only be considered as having themselves reference to one of the 
 great objects for the promotion of which this Government was established, and 
 lor the accomplishment of which the special powers, contained in the constitu- 
 tion, have been delegated. 
 
 Is this authority to establish a bank, an incident to the power of Congress 
 " to borrow money on the credit of the United States," by reason of its cor- 
 relative tendency in procuring a faculty to lend? If this be the source from 
 which it is lawfully derived, we need look no further for the origin of this or 
 of any other authority. If this be its fountain-head, we have here a never-fail- 
 ing spring of power, abundantly sufficient for all the purposes, lawful or unlaw- 
 ful, of this or of any other Government upon earth. I turn away from it, there- 
 fore, without further investigation. 
 
 Is this power derived from that of coining money, regulating its value, and 
 that of foreign coin? Is the right to establish a national bank, on account of 
 its tendency, in our hands, to operate upon what is called the currency of the 
 country, derived from this, or any other specially delegated authority? There 
 are two provisions in the constitution, which have some bearing upon this point. 
 That to which I have just referred, respecting coin ; and that which prohibits to 
 the States the issue of " bills of credit, and the declaring of any thing but gold 
 and silver a lawful tender in the payment of debts." It cannot be necessa- 
 ry to argue that a power to make a bank, distinctly with a view to its putting 
 into circulation promissory notes, that shall have the faculty of mixing and 
 keeping company with the currency of the country, and of becoming some- 
 thing like paper money, is not a necessary and proper auxiliary to the power 
 in this Government ot making a metallic medium; that a power, in short, to 
 make a metallic money has not incident to it, as a " necessary and proper" 
 mean for its execution, the power to make a paper money. Nor need any time 
 be spent in resisting an inference, drawn from a restraint imposed upon a 
 particular power in the State Governments, which affects to communicate to, 
 and to set up in, this Government, a faculty co-ordinate with another power, 
 which is left in those Governments, free and unshackled. So far then as 
 honorable gentlemen say this measure is intended or calculated, whether with 
 a view to regulation, or improvement, or under any other pretence, to operate 
 upon what is called the national currency, or, in other words, to restrain the 
 States from establishing similar institutions, and impair the free exercise of the 
 franchises of those they have already incorporated, it is warranted by no part 
 of the constitution. 
 
 I come now, sir, to that part of the constitution, where alone can be found, 
 if any where, the lawful source of this Government, to incorporate a banking 
 company. We have the power " to lay and collect taxes, duties, imposts, 
 and excises," for certain great national purposes. It is now admitted, by most 
 of the former opponents of this doctrine, that the establishment of a national 
 bank is nothing more than (he employment of a ''necessary and proper" mean 
 " for carrying into execution" the power to which I have just referred. The 
 correctness ot this doctrine, I have before declared it not to be my purpose to 
 call into question. This part of my argument is entirely predicated upon its ad- 
 mission; and is designed solely to be confined to those views of the subject, 
 which will show the true character and just extent of this authority; and en- 
 able us to determine whether we are not carrying it, by the provisions of the 
 bill now on our tables, further than is warranted by the constitution. This, 
 then, being the power, to which the authority to establish a bank is incident, 
 as a " necessary and proper" mean for its execution, we cannot have much 
 difficulty in the definition of its limits- Its effect upon this power must be in 
 relation to the collection, the safe keeping, and transmission of the public re- 
 venue. The notes which a bank issues may (but, by the by, the affairs of a 
 bank may be mismanaged and they may not) provide the People with an equal 
 medium for the payment of their public dues to this Government. This is, 
 to a certain extent, to operate upon the currency: it is not merely to afford 
 the People, in their relations with the Government, something more portable 
 and convenient to procure, and keep, and pay, than metallic money, but it is 
 
ON THE GRANT OF THE CHARTER OF 1816. (597 
 
 to provide them with a medium of contribution, at a time when the metallic 
 medium shall disappear from circulation. Here provision in relation to the 
 currency generally* would seem, at first, to be intended for an event like that 
 of the disappearence of the metallic medium; but we must always remember 
 that our power, in relation to the medium of circulation, refers solely to a 
 metallic medium; and of course excludes the other -expressio unius cst exclu- 
 sio alterius. If it be not questioned how far, in this point of view, as con- 
 nected with the currency, (a subject, as before mentioned, expressly legislated 
 upon) there is a power to procure, for the People, these kind of facilities, for 
 the payment of their taxes, surely the power must, in this respect, confine it- 
 self directly to this end. What then is the capital necessary for constituting 
 a bank to answer this purpose? This ought to have been shown us. Those 
 who have no warrant to employ this power, but distinctly with a view to the 
 attainment of a particular end, must have known that the purposes for which 
 alone it can be lawfully used, prescribe the limitations to its exercise. The 
 moral obligation imposed upon them not to exceed those limits, requires, 
 likewise, that they should ascertain where they were placed. It there has 
 been an inquiry made upon this head, what principles have guided that inquiry? 
 and which of them have been presented to the Senate? What calculations 
 have been submitted to us, to shew that, in respect to the capital, we are not 
 exceeding the pale of our authority? The hazard of excess must not be in- 
 curred, while there are any means, at our command, ot ascertaining how it 
 may be avoided. It is not for those of us who think it, at this time, inexpedi- 
 ent to establish a bank, to show where the excess is. It is incumbent upon the 
 friends of this bill, who call upon us for our votes, who desire that we should 
 keep them company, to prove to us that they are going no further than they 
 ought to go. This they have not done. It lias not been affirmatively proven to 
 us that a capital to this amount is necessary; and for one, I think it can be 
 demonstrated that a capital of thirty-five millions is larger than is required, 
 fur the purposes for which we are to establish a bank- A capital much lower 
 than even twenty millions, would be adequate to the establishment of a bank, 
 in each State in the Union, and th'i objects of safe keeping, and easy trans- 
 mission of the public revenue, accomplished. The capital of this bank, with a 
 view to the effect of its notes, in affording an equal medium for the payment 
 by the People, and the receipt bt the Government, of the public dues, is not 
 to be inquired into, with a view to any given state of things. The charter is 
 to last for twenty years. If this capital, during that period, should be likely 
 to become too small, the power to raise it by our own, or other subscriptions, 
 may be reserved. If we have a view, in ascertaining the proper extent of this 
 capital, to periods when the preservative of a metallic medium shall be with- 
 drawn from the paper circulation, then this capital, (if the bank is to be what 
 its advocates insist upon it to be their intention to render it, a specie paying 
 bank) is unnecessarily large. Its issues, in such times, must be limited, not 
 by the amount of the public revenue, but, by that of the specie in its vault?. 
 If our attention, however, is principally directed, as to me it seems it ought 
 to be, to the usual and natural state of things, when the presence of the me- 
 tallic medium will afford to the paper currency a free and uninterrupted cir- 
 culation, then a much smaller capital than that of thirty -five millions, in such 
 a state of things, would enable the bank, by the successive issues and returns 
 of its paper, to afford to the People and to the Government the desired facili- 
 ties. The process between the Government and the People is that of payment 
 and disbursement; and the steady and uniform succession of these operations, 
 which can never be disturbed ? communicates to a paper medium, even in a 
 higher degree, the well known faculty belonging to a metal lie medium, of trans- 
 acting a large amount of business with a small amount of money. In this 
 view of the subject, can there be a question whether a much smaller capital 
 would not afford every lawful facility that the revenue operations of this Go- 
 vernment require? A capital of ten millions successfully accomplished this 
 object, and with the aid of three or four millions of other banking capital, con- 
 jointly with the metallic medium, circulated the whole business of the Govern - 
 83 
 
698 BA NK OF THE UNITED STATES, 
 
 inent and the country. Surely, then, a national banking capital of twenty 
 millions, with the banking capital of" the States, will be now amply sufficient 
 lor the same purposes; however high maybe our estimate of the increased ac- 
 tivity and expansion of the industry and enterprise of the country. If I am 
 well founded in these remarks, 1 have sustained and established one constitu- 
 tional objection to this bill; by showing that the capital of this bank is larger 
 than is necessary for the accomplishment of the objects we are required to keep 
 in view, in the establishment of this institution. 
 
 There is another, and a more interesting point of view, which it remains to 
 notice, and which goes to show that this bill does not merely, in respect to 
 capital, exceed our constitutional authority. 1 refer to that provision which 
 authorizes the appointment of a certain proportion of the directors of this bank 
 by the Government. Every control and authority over this great moneyed 
 institution, so intimately connected as it is with the great interests of society, 
 beyond what is requisite for the promotion of the limited objects we are bound 
 to keep in view, communicates to the Government an influence and patronage 
 which it has no right to possess. It is proper that I should circumscribe, within 
 narrow limits, what I have to say in respect to the just character of that in- 
 fluence, after the able view of it which must have been presented by the honor- 
 able member from New York, (Mr. KixoJ in support of his motion to strike 
 out this part of the bill. The honorable chairman (Mr. BIBB) who reported 
 this bill, in reply to that ai-gument, insisted that there was incident to the 
 power to establish a bank, that of prescribing the regulations which are neces- 
 sary to guard the country against the mischief it might otherwise do. Sir, I 
 deny not the truth of this position; but still it equally remains to be shown 
 that the regulation in question, which invests the Government with an influ- 
 ence of such magnitude, is " necessary and proper/' to prevent a greater mis- 
 chief than the one which the regulation itself' introduces. The honorable 
 member from Virginia (Mr. BARBOUR) contends for the salutary effect of this 
 regulation, and insists that it communicates to the Government an influence 
 too unimportant to justify any serious apprehension. He considers these di- 
 rectors merely as sentinels on the watch tower, and that the smallness of their 
 number can never give to the Government a dangerous ascendancy in the 
 management of this institution. Let us for a moment inquire into the cha- 
 racter of these directors. If they are sentaiels on the watch tower, if they 
 are to be enlisted into our service, what bounty are we to give them, what pay 
 are they to receive from us? They are to perform for us an important service, 
 they are to apprize us of the earliest approaches of danger. The board of di- 
 rectors will be daily assembled, and these our sentinels must mount guard 
 as often; they are to have a full share of trouble in the superintendence of 
 this institution, and they are to do all this, not for the good of the concern in 
 which they have no participation, but for our advantage solely that we may 
 know in time to take care of ourselves, when this company is likely to go 
 astray from its duty to the stockholders, the country, or the Government. 
 These are services, I admit, of great value, and to be performed, no doubt, 
 by able and virtuous men; and yet, for all this, you pay nothing and why so? 
 Are we to calculate upon a degree of patriotism arid disinterestedness, to 
 which we make no claim ourselves? The truth is, we do not expect these ser- 
 vices to be performed for us, without remuneration; but the anomaly consists 
 in our not paying for them ourselves. These spies are to be in our service, 
 and to laboi lor us, on account of the pay they receive from others. In imi- 
 tation of the Napoleon model, these gentlemen are to be maintained by those 
 whom they are set over to guard. Their posts will be places in request at all 
 times -in peace as well as in war. In times of peace, of public repose, when 
 the business of the country is undisturbed, and the Government in no need of 
 loans from the bank, these directorships will be entirely useless, for any law 
 ful purpose, to the United States. During this period, the men who hold 
 these appointments, and their numerous friends, will be but as vultures fat- 
 tening on the institution. During this period, you obtain a patronage for the 
 administration, through the medium of these directors, and their retainers, 
 
ON THE GRANT OF THE CHARTER OF 1816. 
 
 without the performance of any lawful service. In this respect, then, the pro- 
 vision is unconstitutional: and the influence for which you oblige others to 
 pay, is as unjust as it is unconstitutional. But when the season of difficulty 
 arrives; when war shall disturb and break up the regular course of business; 
 when public and private credit shall be shaken; when the good of the country 
 shall imperiously require the attain? of this institution to be conducted with 
 even more than the usual prudence and circumspection; then will be the time 
 that the pernicious agency of this directorship, co-operating with other active 
 influences, will wield this great moneyed corporation, at the will and pleasure 
 of the Government. It is no answer/to tell us of the smallness of the number 
 of these directors. The Hercules is in the system in the poweMhat the 
 Government possesses of continuing or withholding its deposites. These di- 
 rectors are but the club with which you arm him. The smallness of their num- 
 ber is no security. The principle upon which they are introduced is unsound, 
 is corrupt, is contagious, and its natural tendency will be to spread itself. 
 These hve directors, (whom the Government then \yill take care to keep in 
 their own pay) themselves the absolute creatures of those from whom they 
 have derived their authority, will be sure to find at the board, when the spirit 
 of party in the country runs high, others become as subservient as themselves; 
 and cannot fail, in a season of difficulty and embarrassment, with their united 
 influence, to accomplish, through the fears and the hopes of the rest, whatever 
 shall be demanded of the bank, as the price of the continuance of the Govern- 
 mental favor. By this process, will loan upon loan be riveted upon the bank, 
 until this great debtor will become its lord and master. Surely these appre- 
 hensions cannot justly be called the offspring of distempered imaginations. 
 Honorable gentlemen certainly, who, themselves, have painted in such glow- 
 ing tints, the terrors of this influence not of the influence of such a body 
 politic as this, in which it is organized, and directly set up and established, 
 and openly avowed to the world, but of one where it was sedulously guarded 
 against surely such will not insist that there is no foundation for alarm. 
 Formerly it was said, give this new power this lever, but a fulcrum a point 
 to rest upon and, like another Archi mid eg, it will move the political world 
 as it pleases. Afford it but an opportunity to act upon the States, and there 
 will be nothing in their sovereignties, or the people, beyond its purchase. For- 
 merly it was calculated, in its mildest form, to destroy the responsibility be- 
 tween the Government and the people; and leading fo extravagance, to cor- 
 ruption, and to wicked and ruinous wars, to overturn the liberties of this na- 
 tion. If these representations of danger were somewhat surcharged in respect 
 to the former institution, how just are they with respect to the present! To 
 me it seems, that now is the time that we ought most sedulously to guard 
 against a power of this kind in the Government, while the young, the enter- 
 prising, the ambitious, and <he military character of this country is developing 
 itself. I say the military character of this nation, because it is but too appa- 
 rent, that the events of the late "glorious war*' (as it is not unfrequently 
 triumphantly termed) have had no tendency to increase our fondness for the, 
 pursuits of peace. That there was glory gained in that war, I am proud to 
 acknowledge; but, speaking of the war generally, and the situation of the coun- 
 try during its continuance, of its causes and its termination, I may be per- 
 mitted to say, if there was glory and I repeat again, I am proud to ackmnv- 
 ledge it it was only " gloom in glory dressed." Much, sir, I fear, that this 
 happy country, once so fond of peace, when sufficiently practised upon, is to 
 become as deeply enamored of war and valorous enterprise, as La Mancha's 
 Knight, and with him, is to be made to exclaim, " armor is our dress and bat- 
 tles our repose/' I shall press this abjection no farther. We are permitted, 
 by the constitution, to incorporate a banking company to facilitate the collec- 
 tion and disbursement of our revenue. It has been* shown, that this power 
 must be exercised with a view to its proper objects, and that every regulation 
 that looks further than the attainment of these objects is unwarranted; and 
 in relation t ) this directorship, I think it must be apparent that it is entirely 
 foreign to these objects; or, it in a slight degree incidentally connected witli 
 
700 BANK OF THE UNITED STATES. 
 
 them, that its main bearing is upon other points, and that its general tendency, 
 by the concurring testimony of all parties, is to communicate an influence to 
 the Government of the United States, of an extremely dangerous character. 
 The bill, therefore, in this respect, is unconstitutional. 
 
 The remaining constitutional objection to this bill arises from its interfer- 
 ence with the concurrent power of the States. It is to operate upon the State 
 banks, " peaceably if it can, forcibly if it must." With this object in view, 
 the bill no doubt has been formed to have due effect. Indeed, with the con- 
 trolling influence of the Government, it cannot fail to accomplish its object, 
 whenever the necessary impulse for that purpose shall be given. If a faculty 
 is communicated to a power in this Government to regulate a concurrent 
 power in the State Governments, there is an end at once of the co-ordinacy 
 of these powers one of them instantly becomes only the humble dependent 
 upon the other, and must even cease its existence whenever the will and plea- 
 sure of its superior shall be known. How extraordinary has been the course 
 of opinions upon this subject! The friends of a bank formerly required for 
 this Government the exercise only of an equal and concurrent power even 
 not so much; they are now obliged to argue against honorable gentlemen who 
 refused that power, and who now, in eftect, contend for the exercise of a su- 
 perior and exclusive power. If such, then, is intended to be the eftect of this 
 bill, and if its provisions are calculated for the attainment of that end, it is 
 most indubitably unconstitutional. If what is termed implication, is to be- 
 come the lawful proprietor of what she is only permitted to use for a special 
 purpose, and is to bear off too what she has no pretence for asking to borrow, 
 all our paper regulations are idle. With an encroaching and restless agency 
 of this kind in the constitution, there is no limit to the power of this Govern- 
 ment. I shall press no further constitutional objections to this bill; but will 
 now proceed, with the further indulgence of the Senate, to examine the gene- 
 ral policy of this measure. 
 
 This bill came out of the hands of the administration ostensibly for the 
 purpose of correcting the diseased state of our paper currency, by restraining- 
 and curtailing the over issue of banking paper; and yet it came prepared to 
 inflict upon us the same evil, being itself nothing more than simply a paper- 
 making machine; and constituting, in this respect, a scheme of policy about 
 as wise, in point of precaution, as the contrivance of one of Rabelais' heroes, 
 who hid himself in water for fear of rain. The disease, it is said, under which 
 the people labor, is the banking fever of the States; and this is to be cured by 
 giving them the banking fever of the United States. To my mind the real 
 evil consists not so much in a superabundance of paper, as in a scarcity of 
 specie. The paper currency does not exceed what is required to circulate the 
 business of the country; it only wants the accrediting, the quickening, the 
 vivifying principle which it requires a certain proportion of specie to commu- 
 nicate to it. But this bill is to supply that want; it is to be our alchymist, 
 and is to effect, for us, even the transmutation of paper into gold. How this 
 matter is to be conducted, we have not been told. It is admitted, that the 
 great desideratum will not be afforded all at once. The process, we are in- 
 formed, requires time; but we are assured that, in the end, it will not disap- 
 point our hopes. For one, sir, I am not willing to trust to a scheme of this 
 sort- Not only it is not shown how its professed object is to be accomplished, 
 but the fallacy of its pretensions is susceptible of demonstration. This is to 
 be a specie, or a paper-paying bank. Take either hypothesis suppose it 
 the former. Will it increase the quantity of specie in the country P will 
 it restore to circulation that which is in the country P or will it put into 
 circulation any thing that will answer the purpose of specie P That it 
 will increase the quantity of specie, powerful as may be its alchymy, none 
 will pretend. W T ill it emancipate from restraint what is already in the coun- 
 try? That the quantity of specie in the United States is diminished, is ac 
 knowledged, and it will not be denied that a much Larger proportion of specie 
 than formerly was sufficient to maintain the free circulation of bank paper, 
 will be required to revive and establish public confidence in that currency, as 
 
ON THE GKANT OF THE CHARTER OF 1816. 7Q1 
 
 a steady and certain representative of gold and silver. Those banks, there- 
 fore, that have now the precious metals locked up in their vaults, not only 
 will, but ought to keep them there, until the necessary addition is made, by 
 the course of trade; more especially ought they to do so at this time, when 
 the course of that trade has thrown the exchange so much against us, that 
 every dollar they paid out would be exported. If this bank is to be a specie 
 bank, will it put into, and keep in circulation, any thing that will answer the 
 purpose of specie? Who are to borrow of this bank, and what will be their 
 inducements to borrow? Those who obtain discounts will receive paper equal 
 in value to gold and silver: and their debts must be paid off when they become 
 due, not in the notes of other banks,. but in the notes of this bank, or in gold 
 and silver. If they borrow for the purpose of obtaining a more equal and un- 
 varying medium, than any other bank paper will afford them, of remittance to 
 any part of the United States, or with a view to purchase cheaper any thing 
 they may want to buy, their object is accomplished. But, when the time 
 arrives for them to pay off their debts to the bank, they must purchase up 
 the paper of this bank, or gold and silver, with other banking paper, and 
 with the same or a greater loss. What will they then have gained by 
 the transaction? Pay their debts they must, when they become due; and, 
 cost what it will, they must procure the paper of the same bank, or gold and 
 silver. They have gained, say ten per cent, in their remittance, or their 
 purchase, and they must give it up again to obtain the means of paying these 
 debts; and, moreover, run, without any advantage, the risk of being disap- 
 pointed in procuring those means. There will be, likewise, accompanying 
 this, another operation. Those who borrow, (if any under such circumstances 
 will borrow) must have a view to purchase, or remittance to some other part 
 of the Union; and in that mode, the paper of this bank will get into the hands 
 of persons who have no debts to pay to the bank. What will th^y do with 
 this paper? Will it come into their possession so utterly untainted with sus- 
 picion, with such all -conspiring confidence, as to make the holders of it pre- 
 ler it to gold and silver? Certainly not. The recollection of recent events, 
 the infirm condition of the other banking paper, will prompt the holders of it 
 to demand immediately in exchange, that which they know is immutable in 
 its value. And, moreover, there may be a sudden fluctuation, in the rate of 
 foreign exchange, which may communicate to gold and silver a temporary ap- 
 preciation over the paper currency, without sensibly, (if at all) depressing 
 cotemporaneously itfl value in relation to any thing else it may command. 
 When this takes place, the holder of the gold and silver obtained from this 
 bank in exchange for its paper, will find a profit between the value at which 
 he received the paper, and the gold which he has obtained for it, sufficient to 
 induce him to part with it for the currency of the other banks; and which pro- 
 fit he can, by investment and purchase, render certain before the impulse of 
 appreciation can be communicated to what he finally obtains. While, there- 
 fore, the exchange against the country is progressing, this process will accom- 
 pany it, and effect the removal abroad ot our specie. To emancipate specie 
 from the restraints now imposed upon it, is to permit it to pursue its own 
 course; and that course (in the present state of foreign exchanges) leads it 
 out of the United States; and thus the immediate and inevitable effect of our 
 legislation for restoring specie to circulation, is to send what we have remain- 
 ing of it out of the country. If, in this state of things, then, this bank is to be 
 a specie bank, it can issue paper only to the amount of its specie. It cannot 
 issue paper even to that amount, because there will be no inducement to bor- 
 row, upon the terms upon which a specie bank can now alone lend: and even 
 if it could lend out, on these terms, paper to the amountofits specie, it would 
 effect nothing in value, towards the great object of this policy. It would be 
 only amusing itself, like Diogenes, who set himself about rolling his tub, ra- 
 ther than be idle, while all others were employed. Rut allow me here, sir, 
 to ask, what is to be done, if this bank, in which we as stockholders are to 
 have so deep an interest, should, as it probably pretty soon will, wade out of 
 its depth should exhaust its specie (as it inevitably must do if it issues paper 
 
702 BANK OF THE UNITED STATES. 
 
 to an amount exceeding, even in a very limited degree, its specie capital) and 
 becomes unable to pay its paper? When that happens, as happen it must if 
 there is not a considerable addition to the specie capital of the country, the 
 urgency of the case will make its own law; and it will either be the law of 
 public opinion, of public necessity, and public interest the same law under 
 which the State banks now operate or it will be a la\y of ourovyri enactment, 
 striking oft' the shackles we are now riveting upon this institution. No, sir, 
 this bill cannot restore the specie in the country to circulation, nor can it dis- 
 solve the povyerful spell which fear, and suspicion, and even prudence, have 
 placed upon it. Of our capacity to increase its quantity by this bill, we have 
 about as good evidence, as the facetious writer, before referred to, had of his 
 royal descent; he had, he tells us, 4 ' a marvellous desire to be a king himself;" 
 we have "a marvellous desire," I admit, to increase the quantity of specie; 
 and we have no other better way of showing the specie-making tendency of 
 this bill. 
 
 I beg leave, sir, to remark upon the distinctly avowed coercive policy in 
 which this bill originated,^ with a view to considerations that are foreign to the 
 constitutional question. This bank has an immense capital, and when the 
 state of things in this country shall be better settled^ when a favorable course 
 of trade shall have brought us the necessary supplies of specie, the operations 
 of this, and other banks, will be conducted as formerly. This, then, will 
 become a paper making bank, as well as the others; but, the excess of all, 
 will be guarded against by the necessity which will be imposed, of maintain- 
 ing the principle of convertibility. This new bank (with its branches) will 
 have afforded it, by Governmental deposites, and the receipt, by the United 
 States, of the public revenue, in its paper, the means of extending its dis- 
 counts, and increasing its issues, in proportion to its capital, greatly beyond 
 what the other banks can venture to do; and, particularly, must the opera- 
 tions of the State banks continue very limited and circumscribed, until the 
 first hostile impulse communicated to this institution has ceased to operate, 
 and until due confidence can be inspired, that the same vindictive spirit will 
 not again be aroused and inflamed. In this state of things, the banking cap- 
 ital you now create, will firmly establish itself, and, eventually, take the 
 place of so much of the capital of the State banks. You create a banking 
 capital beyond what is requisite for the attainment of the lawful ends of this 
 Government; no one having disproved, indeed all seeming to admit the ex- 
 istence, already, in the country, of a sufficient banking capital. Why, then, 
 is this injustice done, of supplanting one species of banking capital with ano- 
 ther ? Can we forget that a large proportion of the State banks is the offspring 
 of our own policy ? We refused the re-incorporation of the old Bank of the 
 United States; we declined, altogether, the exercise of the authority to esta- 
 blish these institutions, and. mainly, upon the ground xhat the povyer to or- 
 ganize them was, exclusively, vested in the State governments. This opinion 
 was adopted, and zealously, and perseveringly asserted, by the most potent 
 States in the Union, and subscribed to, and openly maintained, by the most 
 enlightened, the most intelligent, and infl'iential supporters of the present 
 order of things. Hence the origin of a great many of the State banks. The 
 subscribers to those banks, relying upon the soundness, or, at least, the per- 
 manency of this opinion, purchased tneir charters of the States; and the pub- 
 lic money of those governments has been invested, to a large amount, in those 
 banks. "What, then, can warrant, in a renunciation of former sentiments, 
 the extension of the capital of this bank, beyond the proper objects of such a 
 bank ? It is equally forbidden by the constitution, and by the plain principle 
 of common justice. Let the conduct of these institutions (generally speak- 
 ing) be examined, let it be exposed to the severest scrutiny, and there will 
 be nothing found to justify the severity of this measure. Even if it be admit- 
 ted that the course of these bodies, set free from the restraints which usually 
 oblige them to revolve in their proper orbits, has been somewhat erratic. 
 What then r Has their course been that of public calamity, and private dis- 
 tress? You must judge of them by the good, as well as the evil they have 
 
ON THE GRANT OF THE CHARTER OF 1816. 793 
 
 done. They have been the nerve and spring of your industry; they have 
 been the spirit which has animated your enterprise; and, if they have been a 
 fountain which has sent out bitter water?, they have sent out sweet waters 
 too. What would have been your condition, what would be our condition 
 this moment, without them ! Have they banished the specie from the coun- 
 try ? That was the aftiiir of our achievement. This useful triend we lost 
 ourselves; and they have, to the best of their ability, supplied its place. Is it 
 for us to bestow upon them unqualified censure; tor us, whose measures an- 
 nihilated the restraint?, and withdrew from them the great security of steadi- 
 ness and uniformity, is it for us to condemn them, in mass: who were the 
 first to seize with avidity, and to profit, to the fullest extent of our influence 
 over them, of the opportunity made by ourselves to lead them astray ? Then, 
 our conduct to them was " as soft as the tips of our ears;" but now, that our 
 purpose is served, *" our gorge rises" at them, and in the time of their need, 
 we unhesitatingly devote them to destruction. 
 
 I have said, sir, that the evil was not in a superabundance of paper, but in 
 a scarcity of specie: for, I think every view taken of the operations of the 
 banks, will show, with but few exceptions, that they have not exceeded their 
 proper limits. The first eftect of loosening their restraints, was not to send 
 them a heedless, headlong course. The influence of habit continued, after the 
 necessity, which gave it birth, had ceased. They went on in the same path, 
 and might have been so expected to do, for some time, by their own momen- 
 tum. These banks were, generally, under the direction of able and honest 
 men; not of such as were incapable of appreciating the difficulty and delicacy 
 of their situation, but of men whose prudence, foreseeing the embarrassments 
 they would have to contend with, immediately replaced the restraints which 
 necessity had imposed and maintained. The particular instances of excess 
 which have been referred to, are those of exception; and, even in those cases, 
 the business of the bank has fallen below what specie times have witnessed, 
 and will warrant, and, still further below what this bank, with its paper cir- 
 culating capacity, will do in such times. What course, different from that 
 which they have taken, would we have had them to pursue, in the situation in 
 which they were placed ? Ought they, in a time of public and private calami- 
 ty and distress, have called upon their debtors ? Ought their paper to have 
 disappeared in the proportion that specie vyas withdrawn ? And, if this ought to 
 have been done, how was the business of the country to have been transacted, 
 in the absence of both specie and paper? If these banks had called in their 
 paper as the specie disappeared, and as the necessary demand for it increased, 
 at a time, too, when public confidence, accompanied by public necessity and 
 public convenience, tendered herself ready to perform, for this circulation, 
 every office of specie; to reanimate it: to breathe into it a new and efficient 
 principle of vitality; if such, under such circumstances, had been the conduct 
 of these banks, we should have been, ourselves, among the loudest to com- 
 plain. They did, then, sir, what they ought to have done. Like wise and 
 prudent men, instead of" resisting an evil they could not avert, they did all 
 that was left for them to do; they applied to it the best and only remedy that 
 remained, one, which, if it has not cured the disease, has, at least, alleviated 
 its affliction. 
 
 I do not know that there is much hope of effecting the postponement of this 
 measure; yet, every consideration belonging to it, everv view which can be 
 taken of it, seems, to me, to require of us the utmost deliberation and circum- 
 spection. 
 
 1 know that there is a loose and vague notion afloat in the public mind, of 
 one great uniform national currency. I will not dignify this notion by calling 
 it public opinion. I know, sir, that we are looked to, as were, in other times, 
 ' the baker and the baker's son;" but, surely, the cool, and intelligent, and 
 enlightened men of our country, who have reflected seriously upon the exist- 
 ing state of things, do not expect relief, in this matter, from our legislation. 
 They know, full well, how much easier it is to legislate a country into diffi- 
 culties, than it is to legislate it out of them. They understand the nature of 
 
704 BANK. OF THE UNITED STATES. 
 
 the diseaseits cause, and its remedy. They look not to us for health, who 
 have medicined them into sickness. All they ask of us, is, to desist, 4fc to 
 leave them alone." Time is their physician. They want time to recover 
 from us; he has " healing upon his wings," we have none upon ours. Those 
 who know not the cause of our disease; who have been blind to the natural 
 tendency to this state of things, of the measures which have been pursued for 
 several years back; who know not the agencies which have withdrawn the 
 specie from our country, and who cannot comprehend the influences which 
 have given such activity and effect to those agencies, may have a notion 
 that we can relieve them: and it cannot be expected that the deep responsi- 
 bility which is involved by the measures which have led to the present diffi- 
 culties, should take much pains to dissipate the delusion. If we are to profit 
 by this delusion, which conceals the past from public view, let us not go still 
 further into error. The step we are going to take, we should remember, 
 with the honorable gentleman from New York, (Mr. SANFORD) is not one 
 which we can retrace. In common cases, if we commit an error, subsequent 
 legislation can remedy it. Not so here. An error committed, in the passage 
 of this law, is beyond our power to correct. And, furthermore, let us spe- 
 cially remember the magnitude of the power which we propose to regulate. 
 It is not merely the banking power of this institution, but the banking power 
 of the States. What is to be the bearing of our legislation upon great interests 
 like these, so closely interwoven as they are with the pursuits of the people, 
 it is incumbent upon us vyell and maturely to consider. The science of bank- 
 ing, connected as it is, in peace and in war, with the circulating medium; 
 with the various operations of Government; with the different great interests 
 of society in general; with the individual industry and enterprise of the citi- 
 zen; with the value of other capital, and with the moral character of the 
 People; is a science, like all others, of progressive improvement, and is, per- 
 haps, even at this time, but very imperfectly understood by those who have 
 devoted most time to its study. Could, sir, this science now call to her 
 aid, him who wrote upon the subject " as with a sun beam," the justly cele 
 brated author of the *' Wealth of Nations" even this, her favorite son, 
 would be obliged to confess that much of his theory, which the world has so 
 long adopted, was but like " the clouds that .gather round the setting sun, 
 and seeming only to form a part of the brightness by which they are illu- 
 mined." Who, then, among us, is entitled to hold the " Lamp of Truth" 
 to this subject? None of us, it is true, can be blind to the causes of the evil 
 complained of. We know, now, too well, the effect of the bold experiments 
 we have tried upon the People. Tremendous as they were, it required but 
 little skill to make them. But, to build up anew what we have broken down, 
 to repair what we have wasted, is an achievement of another sort. Peace, 
 and the uninterrupted pursuits of industry and enterprise, spread their bles- 
 sings around us. Restrictive regulations, and war, have snatched many of 
 them from us. The price the country has paid for our experiments is gone. 
 If it has not made us wiser, we have nothing in return. What we have lost 
 must be replaced as it was gained. Legislation is the medicament which has 
 made us sick; but it has no charm to restore us to health. One great interest 
 in our country, from sad experience of our measures, has long since learned 
 to look to the period of assembling the national councils, as a period of nation- 
 al calamity. What Thucydides says of the speech of Alcibiades turning 
 against his own country, and explaining to her enemies her vulnerable posi- 
 tions, " while he speaks she totters," may justly be remarked of too many of 
 our measures while we legislate the country totters. The great body of our 
 merchants have, in a special manner, cause to tremble at our legislation; that 
 great body of men, whom the sweeping denunciation of an honorable mem- 
 ber on this floor lias, this day, placed in the most degraded and the most 
 worthless ranks of society. That honorable member makes exceptions, which 
 serve, however, only to set in stronger view the estimate he forms of the rest. 
 Sir, when honorable members of this House, and from great and potent States 
 in the Union, entertain these sentiments, and express them upon this floor, 
 
OK THE SHAN'T OF THE CHARTKll OF 1816. 7Q5 
 
 u manifests a hostility to commerce, which justifies all the apprehensions of 
 her friend-!. It is lull time for the merchants the Morrises and the Fitzsim- 
 monses to take their seats among us, to assert their own character, and main- 
 tain their own interests. Were they here, they would find occasions to tell 
 us that it is not the fanner, or the country gentleman, the fleeces of whose 
 flocks grow too slow for our Wai poles. that we have repaired to their " altars," 
 not to worship there, but to shut up their " bible," and bear off their "Gtodf 
 that the seat of commerce is not to be found " in the midst of the secret and 
 solitary hill, nor her voice to be heard in the murmur of the mountain stream." 
 
 Upon a subject, sir, like that now before us* of a complex and intricate 
 character, having the closest relations to the strongest interests in society; 
 with no special illumination ourselves; in the absence of all practical informa- 
 tions uninspired with much of confidence in our own skill, by the success of 
 our former experiments on political economy; is it. wise to act at all but, 
 most especially, upon a subject of this character, is it possible, in the nature 
 of things, for a general legislation, which commits itself to the strong impulse 
 of one given pressure, to pursue the proper course? In circumstances like 
 the present, it is circumspection, it is deliberation which is required, and not 
 action. There are situations of peril in which the soldier halts. There are 
 crises of difficulty and embarrassment, in which the statesman pauses. It 
 is folly, it is rashness, and not wisdom, nor courage, that marches blindfold 
 upon danger. " It is no inconsiderable part of wisdom to understand how 
 much of an evil is to be endured;-' and particularly so when there is reason 
 to hope that the evil will remedy itself. The existing laws, which authorize 
 the issue of treasury notes, will remove all sectional difficulties, and aftord to 
 >he People a safe and equal medium for the payment of their 1; 
 
 I rely upon the indulgence of the Senate to excuse my having so long tres- 
 passed upon their time. I do not flatter myself with the expectation that my 
 humble views of this subject will have much weight; they aiv such as have 
 presented themselves to my mind, and, imperfect as they may be, I have 
 obeyed only the sense of duty, in submitting them to the Senate. It remains. 
 sir, to move von, which I now do, that the further consideration of the bill 
 upon your table should be postponed to the first Monday in December next. 
 
 Mr. DANA made a brief reply; alter which, the question was taken on the 
 motion, and negatived: ayes t5, noes 2'J. 
 
 On motion of Mr. CAMPBELL, the time for taking the subscriptions was OK- 
 from six to twenty day-. 
 
 On motion of Mr. CAMPHKLL, another amendment was adopted, relative to 
 the establishment of branches in the several States. 
 
 Mr. DAGGKTT gave notice that he should, hereafter, submit an amendment 
 to the Senate; after which, 
 
 The bill was reported to the Senate-, ami the amendments were ordered to 
 be printed. 
 
 APRIL 2, 1816. 
 
 The amendments made in committee of the whole having been concurred 
 in, 
 
 Mr. Mvso.v, of N. II. renewed his motion to add to the 17th section, the fol- 
 lowing proviso: 
 
 '* And if the said corporation shall^at any time suspend or refuse payment, in gold 
 or silver, of its notes, bills, or obligations, or other debts, to such an amount, and for 
 such length of time, as Congress may deem injurious to the United States, in such 
 case Congress may repeal this act, and abolish the said corporation, and make such 
 regulations and provisions for the settlement of the affairs, and payment of the debts, 
 of said corporation, and for distributing its remaining property among the stockhold- 
 ers, as shall be deemed just and proper." 
 
 This motion was determined in the negative, by the following vote: 
 YEAS. Messrs. Barbour, Daggett, Gaillard, Goldsborough, Gore, Horsey, King, 
 Mason, N. H., Mason, Va., Sanford, Talbot, Thompson, Tichenor, Turner. 14. 
 
 89 
 
706 BANK OF THE UNITED STATES. 
 
 NAYS. Messrs. Barry, Bibb, Brown, Campbell, Chase, Condit, Dana, Fromentiit, 
 Harper, Howell, Hunter, Lacock, Macon, Morrow, Roberts, Ruggles, Tait, Taylor, 
 Varnum, Wells, Williams, Wilson. 22. 
 
 On motion of Mr. DAGGETT, to amend the bill, by adding thereto the fol- 
 lowing new section, viz: 
 
 SEC .' 23. And be it further enacted, That it shall, at all times, be lawful for a commit- 
 tee of either House of Congress, appointed for that purpose, to inspect the books, 
 and to examine into the proceedings, of the corporation hereby created, and to report 
 whether the provisions of this charter have been by the same violated or not? and, 
 whenever any committee, as aforesaid, shall find or report, or the President of the 
 United States shall have reason to believe, that the charter has been violated, it may be 
 lawful for Congress to direct, or the President to order, a sciere facias to be sued out 
 of the Circuit Court of the District of Pennsylvania, in the name of the United States, 
 (which shall be executed upon the President of the said corporation for the time be- 
 ing, at least fifteen days before the commencement of the term of said court) calling 
 on the said corporation to show cause why the charter hereby granted shall not be de- 
 clared forfeited; and it shall be lawful for the said court, upon the return of the said 
 sciere facias, to examine into the truths of the alleged violation; and if such violation 
 be made appear, then to pronounce and adjudge that the said charter is forfeited and 
 annulled: Provided, hovicver, Every issue of fact which may be joined between the 
 United States and the corporation aforesaid, shall be tried by jury. And it shall be 
 lawful for the court aforesaid, to require the production of such of the books of the 
 said corporation as it may deem necessary for the ascertainment of the controverted 
 facts; and the final judgment of the court aforesaid shall be examinable in the Supreme 
 Court of the United States, by writ of error, and may be there reversed or affirmed, ac- 
 co; ding t3 the usages of law. 
 
 The question on agreeing to said amendment was determined in the affirma- 
 tive, by the following vote: 
 
 YEAS. Messrs. Barry, Brown, Chase, Daggett, Dana, Fromentin, Gaillard, Golds- 
 borough, Gore, Harper, Horsey, Howell, Hunter, King, Macon, Mason, N. H., Ma- 
 son, Va., Sanford, Talbot, Tait, Taylor, Thompson, Tichenor, Turner, Wells, Wil- 
 liams, Wilson. 27, 
 
 NAYS. Messrs. Harbour, Bibb, Campbell, Condit, Lacock, Morrow, Roberta, 
 Varnum. 8. 
 
 On motion of Mr. HARPER, to strike out the scale of vote* at elections, &c, 
 there were 7 yeas, 23 nays. So the motion was lost. 
 
 The bill having been further amended, the question on ordering the amend- 
 ments to be engrossed,, and the bill to be read a third time, was decided in the 
 affirmative, as follows: 
 
 YEAS. Messrs. Barbour, Barry, Bibb, Brown, Campbell, Chase, Condit, Daggett, 
 Fromentin, Harper, Horsey, Howell, Hunter, Lacock, Mason, Va., Morrow, Roberts, 
 Talbot, Tait, Taylor, Turner, Varnum, Williams. 23. 
 
 NAYS. Messrs. Dana, Gaillard, Goldsborough, Macon, Mason, N. H., Sanford, 
 Thompson, Tichenor, Wells, W'ilson. 10. 
 
 APRIL 3, 1816. 
 
 The bill was read a third time. On the question, " Shall the bill pass?" 
 The following was the vote: 
 
 ; YEAS. Messrs. Barbour, Barry, Brown, Campbell, Chase, Condit, Daggett, Fro- 
 mentin, Harper, Horsey, Howell, Hunter, Lacock, Mason, Va., Morrow, Roberts, 
 Talbot, Tait, Taylor, Turner, Varnum, Williams. 22. 
 
 NAYS Messrs. Dana, Gaillard, Goldsborough, Gore, King, Macon, Mason, N. H,, 
 
 Ruggles, Sanford, Tichenor, Wells, Wilson 12. 
 
 [Messrs. Bibb and Thompson, the only absentees, are understood to hare been de- 
 tained from the Senate by ill health.] Eds. of Nat. Int. 
 
 So the bill was passed, and the concurrence of the House of Representa- 
 tives ordered to be requested in the amendments thereto. 
 
ON THE GRANT OF THE CHARTER OF 1816. 707 
 
 HOUSE OF REPRESENTATIVES. 
 
 APRIL 4, 1816. 
 
 The House took up for consideration the amendments of the Senate to the 
 bill to incorporate the subscribers to the Bank of the United States. After 
 the amendments had been read 
 
 Mi-. CALHOUN observed that he had examined the amend. nents; that they 
 were not important; and hoped the question would be put on them generally. 
 
 Mr. RANDOLPH objected to so sudden a decision on the amendments, at so 
 early an hour, too, when t^e House was thin, and b?fore they had bera print; 
 ed. He moved that the consideration of the amendments be postponed until 
 to-morrow. 
 
 This motion, after some further conversation between Mr. CALHOUN and 
 Mr. RANDOLPH, was agreed to: ayes 60, noes 55. 
 
 APRIL 5, 1816. 
 
 Mr. CALHOUN moved that the House proceed to consider the amendments 
 of the Senate to the bill. 
 
 Mr. MILNOR, because of the thinness of the House and the importance of the 
 subject, and further, because he understood that the committee on the national 
 currency were on the point of reporting a very important b'.ll, which might 
 materially affect the decision on the bank question, &c., moved that the con- 
 sideration thereof be postponed to Monday next. 
 
 Mr. CALHOLX hoped the motion would not prevail. The reasons for it he 
 did not think sufficient. The House was as full as usual; and the bill alluded 
 to as on the eve of being reported by the committee, presuppo-ed the existence 
 of a national bank, and the committee had determined not to report it pending 
 the passage of the bank bill. 
 
 After some further conversation between Messrs. CALHOUN and MILNOR, 
 in which the latter gentleman insisted on the propriety of tirst beki| in pos- 
 session of the report referred to, the motion to postpjne the subject to Monday 
 was negatived: ayes 43, noes 66. 
 
 After the amendments of the Senate were read 
 
 Mr. RANDOLPH moved, for the purpose of destroying the bill, that the whole 
 subject be indefinitely postponed; and supported his motion by adverting to 
 the small number of members present, and the impropriety of passing, by a 
 screwed up, strained, and costive majority, so important a measure, at the end 
 of a session, when the members were worn down and exhausted by a daily and 
 lone attention to business; a measure which, in a time of war, and of great 
 public emergency, could not be forced through the House; a measure so deep- 
 ly involving the future welfare, and which was to give a color and character to 
 the future destiny of this country: a measure which, if it and another (the 
 tariff) should pass into laws, the present session would be looked back to as 
 the most disastrous since the commencement of the republic; and which, much 
 as he deprecated war, he would prefer war itself to either of them. Mr. R. 
 then proceeded to argue against the bill as unconstitutional, inexpedient, and 
 dangerous, 
 
 Mr. CALHOUN said it certainly could not be expected of him to enter into 
 so untimely a:iil unnecessary a discussion of the general question. The bill 
 had been before the House three weeks, when it was maturely considered; it 
 was sent to the Senate; and nowcomes back with a fewunimportant amendments, 
 on which the House had to pass. It was unfair to say that the bill was urged 
 through the -House improperly; and the gentleman was mistaken, also, in 
 stating that a bank bill could not be passed at the last session; it was noto- 
 
708 HANK OF THK UNITED STATES. 
 
 rious that a bill to establish a national bank did pass at the last session, and 
 was rejected by the President of the United States. 
 
 Mr. GROSVENOK did not know what the gentleman meant by a hard screw- 
 ed majority. He would venture to say that the House had advanced on this 
 subject with as much deliberation and calmness as they ever did on any pub- 
 lic matter whatever; the bill was not pressed through improperly. The pres- 
 sure talked of by the gentleman, was, in fact, directly the other way. With 
 two hundred State institutions bearing down on the members of this House, 
 it required something more than common firmness it required boldness to 
 urge the bill. This influence would every day become stronger, and if the 
 subject was deferred to the next session, its passage would be impossible. He 
 had never, since he came into Congress, known a bill passed with more am- 
 ple discussion; the gentleman from Virginia had himself taken a part -an able 
 part in it. It was not smuggled through the House; a fair majority had passed 
 it; and he was convinced, from information he had received, that if the Peo- 
 ole themselves could be consulted, there would be ten to one in favor of it. 
 Mr. G. answered some of Mr. RANDOLPH'S objections to the principles of the 
 bill, declaring his difference from that gentleman on the constitutional ques- 
 tion, and his belief of its necessity to the safety of the country. The consti- 
 tutional question had been long since put to sleep by the repeated decisions of 
 all the proper authorities, after mature reflection, and ought never again to be 
 revived. 
 
 Mr. RANDOLPH replied to Mr. GHOSVENOR, and enforced his constitutional 
 objections to the bill, in which he was borne out by the decision of Congress 
 in refusing to renew the charter of the old bank, which decision was grounded 
 on the want of constitutional power. He adverted, also, in support of his 
 opinion, to the instructions from the Legislatures of Virginia and Kentucky to 
 their Senators to vote against the old bank; which instructions were given on 
 the ground of that institution being unconstitutional. Mr. R. declared him- 
 self the holder of no stock whatever, except live stock, and had determined 
 never to own any; but, if this bill passed, he would not only be a stockholder 
 to the utmost of his power, but would advise every man, over whom he had 
 any influence, to do the same, because it was the creation of a great privileged 
 order of the most hateful kind to his feelings, and because he would rather be 
 the master than the slave. If he must have a master, let him be one with 
 epaulettes something that he could fear and respect, something that he could 
 look up to but not a master with a quill behind his ear. 
 
 Mr. WEBSTER said this was a subject on which a great change of opinion 
 had taken place on both sides of the House, and animadverted on what he 
 called a compromise of principle on a great moneyed institution, and the deser- 
 tion, not only of principles, but of friends, which had characterised the pro- 
 ceedings on this bill. He then spoke some time against the bill, which he 
 pointedly condemned, on account of the participation of the Government in its 
 direction and management. If, said he, instead of the little scraps of amend- 
 ments, which were very well as far as they went, but very trifling, and only 
 served to cover the vice and deformity of the scheme, the Senate had returned 
 the bill healthy, in all the beauty of the original institution, it would have 
 passed through the House swifter than the current of the Potomac. 
 
 Mr. HUMBERT replied to Mr. WEBSTER, in defence of the bill, and of the 
 course he had pursued in relation to it. He disavowed any compromise of 
 opinion, either in the principle or the details of the bill. He had sought the 
 best lights to guide him in deciding on this bill. He had listened to the gen- 
 tleman from New Hampshire, as one who would, if any could, point out its 
 defects, and convince him of its danger; but the only objection he heard from 
 that gentleman was the Government direction. That objection, Mr. H. said, 
 was not with him a strong one; and he was free to say. that, if he had the 
 
ON THE GRANT OF THE CHAKTEK OF 1816. 7QQ 
 
 power of legislating at his will, he would hesitate before he gave any class of 
 men the control ot an institution of thirty-five millions of dollars, without re- 
 serving to the Government a strong check on them. Mr. H. protested, with 
 warmth, against the proscription which had been denounced against those who 
 did not, on this subject, go with the majority of that party in the House op- 
 posed to the Administration. He disclaimed any such influence over his pub- 
 lic conduct; he came here to act according to his own sincere convictions, 
 and should despise himself, if he could submit to act as this or that side of the 
 House pointed its finger. Mr. H. concluded by declaring his support of the 
 bank bill to be disinterested: he expected to hold not a cent's worth of its 
 stock, as he was not able to do so, but the bank, he believed, would be a great 
 benefit to the country. 
 
 Mr. WRIGHT said he was one of those who had aided in putting down the 
 old bank, and was sure that, a thousand years after he was buried, his vote on 
 that occasion would be a monumental proof of his worth, and his regard for 
 the best interests of his country. He opposed it on the ground of inexpedien- 
 cy as well as unconstitutionality; but the supreme judicial tribunal had de- 
 cided on its constitutionality, by often recognising it as a party, and it was 
 now too late to insist on the objection. Mr. W. argued some time in favor of 
 the bill; and, adverting to Mr. RANDOLPH'S epithet that the bank was a scheme 
 of public robbery, and his declared intention to hold as much of its stock as he 
 could, Mr. W. said his friend from Virginia ought to recollect that the re- 
 ceiver was always considered as bad as the thief, &c. 
 
 Mr. HARDIX next delivered, at length, his views of the question, objecting 
 to the plan of a bank, as embraced in this bill, on constitutional grounds, as 
 well as from a belief of its inexpediency. He was a member of the Kentucky 
 Legislature at the time, and was one of those \\ho had instructed its Senators 
 to vote against the old bank because of its unconstitutionality; and his opinions 
 remained unchanged, though he perceived some of those who had acted with 
 him in the case alluded to, had changed their opinions, and were now sup- 
 porters of (he bank, &c. 
 
 Mr. SHARP spoke in reply to the remarks of Mr. HARDIX, respecting the in- 
 structions from the Kentucky Legislature, and justified his opinions on the 
 subject of the bank. 
 
 Mr. SOUTHARD made a lew remarks, principally to >how that it was not on 
 the ground of unconstitutionalty that Congress had refused to renew the char- 
 ter of the old bank, and that it had been recognised by the courts, c. 
 
 Mr. (i ROSV KNOR replied to the observations of Mr. WF.HSTER, in a decided 
 manner. He denied the right of that gentleman to lecture other members of 
 the House for the course which their duty prescribed to them. As to the 
 changes ot principle, of which the gentleman had spoken, Mr. G. said he did 
 not mean to inquire whether the gentlemen on the other side of the House had 
 acted consistently, but this he knew, that last year the gentleman had been 
 proud to shake hands with them in relation to a bank, c. The gentleman 
 had spoken of another change of principle, alluding to gentlemen from this side 
 of the House who voted for^the present bill. In reply to this remark. Mr. G. 
 said, in the first place, he had something of that old puritanical principle in 
 him, which objected to being drilled in to vote in this or that manner, on what- 
 ever any gentleman chose to call a question of principle. Why did the gen- 
 tleman call the power of appointment of five directors, given to the Govern- 
 ment, a question of principle? The question is, whether one-fifth of the direc- 
 tion gives the Government a control over the bank? I say no, said Mr. G.: the 
 gentleman says yes, and, saying so. this must be a question of principle. That, 
 Mr. G. said, appeared to be the course of the gentleman's argument, the, force 
 of which he denied. He showed, that, in the State banks in New York, (not 
 undertaking to say how it might be in New Hampshire) such features had 
 
710 BANK OF THE UNITED STATES. 
 
 been incorporated, even whilst Gen. Hamilton was in the full vigor of his life 
 and influence, ana it was done by his party too, &c. The gentleman has said 
 this control would be a lever in the hands of the Government. It was a straw, 
 Mr. G. said, instead of a lever, and could not move an eagle, much less five 
 and thirty millions of dollars. When, even orithis side of the House, did this 
 feature become a question of principle? M r. G. went on to show that he had ob- 
 jected to the feature in question, and endeavored to procure it to be expunged; 
 but he never considered it, nor had it been debated, but as a question of 
 detail. All legislation, he proceeded to argue, was founded in the idea of mu- 
 
 jeci 
 
 the way it travelled, and where it became a principle not in the open face or 
 day he would not, however, here relate its history. It had not been a prin- 
 ciple with him, and never should be. Mr. G. went on to say that he had never 
 heard a wish expressed from any side of the House, that the Government should 
 have an absolute control over the operations of the bank, &c. When the dis- 
 cussion on this bill had been first opened, Mr. G. said, he had heard an able 
 and eloquent speech of the gentleman from New Hampshire on the subject} 
 and that very speech, in which the evils of the present system were fully de- 
 picted, had convinced him of the expediency of the establishment ot this 
 bank, as better calculated than any thing else to remedy the evil. The gentle- 
 man had concluded that address with saying, that, if Congress rose without 
 providing a proper remedy, they would deserve the execration of the nation. 
 Mr. G. said he believed it, and believing, as he had fully delivered his opinion 
 the other day, that there was no remedy but the bill on the table, he should 
 certainly vote for it. Mr. G. made other remarks to show the correctness of 
 this conclusion, and ended by saying that, in the course he was obliged to take, 
 nothing greived him so much as the necessity of differing, on an important 
 question, from men whom he had been in the habit of respecting as oracles, 
 and with whom it was generally his pride and pleasure to act, &c, 
 
 Mr. WEBSTER, in replying to Mr. GROSVENOR, disclaimed any intention to 
 dictate^ &c. In regard to the feature of the bill, which was the subject of 
 discussion, Mr. W. said he considered it a matter of principle; but attributed 
 that opinion to the gentleman from New York no further than he had assum- 
 ed the charge of a departure from principle to apply to himself. What is the 
 matter of principle in this case? That control and influence over a great 
 banking institution should not, be possessed by the Government. The degree 
 of that influence was not material, the principle remaining the same, be the 
 influence more or less extensive. That principle was violated by this bill, 
 which, he went on to say, could not be fairly compared with similar features 
 in small banks in the State Governments. But, he added, every bank so 
 constructed in the United States had failed to answer the purposes for which 
 it was instituted, and was, at this moment, in the daily, habitual violation 
 of its engagements. Could it be doubted, Mr. W. said, that, with this capital 
 and this power over it, the Government could bring any man into terms, and 
 make the banks act as they pleased? Gentlemen had done him honor in 
 quoting his opinions in support of part of the bill; but he asked if it was fail- 
 to quote a part, of his opinions as authority, and abuse him for the rest? Mr. 
 W. expressed the pleasure he had enjoyed in travelling with his friends here. 
 If, in journeying with a friend, on a road pleasant and smooth, through ver- 
 dant fields, they should arrive at a part rough and disagreeable; if they should 
 encounter gloom, and darkness should overtake them; if then his friend chose 
 to abandon Turn, and seek a road more agreeable, let him not, said he, complain 
 if I continue on the old one. To complain pt him, Mr. W. said, the gentle- 
 man might as well complain of the fifty- nine others with whom he acted. 
 The gentleman reminded him of the anecdote of the eleven obstinate jurors, 
 and related a case in which one juror informed the judge that there would be 
 no difficulty in making up a verdict if it were not for the other eleven, who 
 
ON THE GRAM OF THE CHARTER OF 1816, 7J J 
 
 were the most obstinate fellows he ever met with, and that he himself was the 
 only candid and liberal man of the whole twelve. Mr. W. said he had 
 shaken hands with the gentlemen last session on this subject; if they had 
 changed their opinions, they had not made the world the wiser tor them. Mr. 
 W. said, though young, he found that he possessed antiquated notional and 
 that, to be useful, he ought to have been with generations that had gone by. 
 
 Mr. HULBERT said, until the gentleman could show himself divested of the 
 frailties of human nature, he ought not to complain that part only of his opi- 
 nions were quoted. Mr. H. reminded the gentleman of an authority with 
 which lie, doubtless, was well acquainted the learned Coke having finish- 
 ed his great and elaborate commentary on law, a work which would be the 
 admiration of all ages, concludes it by advising his reader not to believe that 
 all which he finds in that book to be law, for there was much of it which was 
 not law. Mr. H. said, if he had had any doubts on this bill, his friend from 
 New York, (Mr. GROSVENOR) had made a speech which perfectly satisfied 
 him of the excellence of the bank. The gentleman from New Hampshire, 
 (Mr. WEBSTER) had at first made the amount of capital an all -important, a 
 fatal error; soon afterwards he came into the House and declared that the 
 Government of the bank was a sine qua non, and for that would compromise 
 his other objections. [Mr. WEBSTER here denied that he had said so.] 1 do 
 not, said Mr. H. pretend to repeat the gentleman's words, but I appeal to 
 this honorable House if the gentleman did not say that the government of the 
 bank was a sine qua non with him, and if that was given up he would support 
 the bill. I do not censure that declaration, said Mr. H. The great charter, 
 under which we sit here, is the work of compromise the South suffered itself 
 to be taxed by the North, for its slave population the spirit of compromise 
 and concession pervades the whole instrument. What the gentleman meant 
 by green fields, smooth roads, separation, &.c. Mr. H. said he could not tell; 
 but if he meant to attribute to him any improper influence, he disdained the 
 insinuation; while he lived, he would act on solid and independent principles. 
 He came here first in a time of war, and, being a young member, expected to 
 find the party, to which he was proud to belong, as the saying was, sticking 
 together; but he was surprised >o find that gentleman often voting on this side 
 and the other. Mr. H. said he would not part with his friends unless they 
 thrust him oft"; but he would prefer parting with friends to parting with his 
 conscience. 
 
 Mr. M'KEE spoke in support of the bill, and asked the gentleman from 
 New Hampshire, notwithstanding he would to-morrow oppose the suspension 
 of the writ of habeas corpus, or any other unconstitutional measure, yet, if a 
 case might not arise, in which its suspension would be proper, and he consent 
 to it? Mr. M'K. argued that there now existed a similar necessity for this 
 bank. The constitution had made it the duty of Congress to regulate the na- 
 tional currency and remedy evils therein; and the proper inquiry now was, 
 whether this bank was a proper measure to carry the constitutional power 
 into eft'ect in this emergency; for this inquiry there was the most rational 
 ground. No treasury regulation would remedy the evil; the banks would 
 laugh at any such regulation. Mr. M'K. said he had voted for the old bank; 
 that he had survived the storm in which his vote had involved him; experience 
 had justified his conduct: and he hoped still to survive, should another storm 
 succeed his present course. 
 
 Mr. SHEFFEY said he was not scrupulous as to the power of the Govern- 
 ment to establish this bank; but he diu not admit that what was unconstitu- 
 tional to-dav would not be so to-morrow; that instrument was fixed and 
 eternal, and could not be got over. The suspension of the writ of habeas 
 corpus was dependent on a fact, which, if it occurred, the suspension would 
 be proper; but if not, it was unauthorized. Mr. S. said he had voted for re- 
 newing the old bank because he thought it was necessary; and if he could be 
 
BANK OF THE UNITED STATES. 
 
 convinced that this bank would realize the expectation of its friends, he 
 would give up his objections. But, without any disparagement to its friends, 
 and notwithstanding the great talents of the gentleman, (Mr. CALHOUN) who 
 led the business, Mr. S. said the question had not been properly met and dis- 
 cussed. When they came to show how the promised remedy was to be pro- 
 duced, they dealt in generals: they did not demonstrate their assertions; it 
 was here they failed and would fail. Mr. S. then argued at some length to 
 show that the bank would not answer the purpose of correcting the evils in 
 the currency, and that the expectation was visionary and delusive. 
 
 The motion to postpone indefinitely was finally decided in the negative, as 
 follows: 
 
 Those who voted in the affirmative, are, 
 
 Messrs. Baker, 
 
 Messrs. Hammond, 
 
 Messrs. Pitkin, 
 
 Barb our, 
 
 Hanson, 
 
 Randolph, 
 
 Bassett, 
 
 Hardin, 
 
 Reed. 
 
 Bennett, 
 
 Heister, 
 
 Roane, 
 
 Birdsall, 
 
 Herbert, 
 
 Root, 
 
 Breekenridge, 
 
 Hopkinson, 
 
 Ross, 
 
 Burnside, 
 
 Johnson, ofVa. 
 
 Ruggles, 
 
 Cady, 
 
 Johnson, of Ky. 
 
 Sergeant, 
 
 Caldwell, 
 
 Kent, 
 
 Savage, 
 
 Cilley, 
 
 Langdon, 
 
 Sheftey, 
 
 Clayton, 
 
 Law, 
 
 Smith, of Pa. 
 
 Clopton, 
 
 Lewis, 
 
 Stearns, 
 
 Cooper, 
 
 Lovett, 
 
 Strong 
 
 Crawford, 
 
 Lyle, 
 
 Stuart, 
 
 Culpeper, 
 
 Lyon, 
 
 Sturges, 
 
 Darlington, 
 
 Marsh, 
 
 Taggart, 
 
 Davenport, 
 
 May rant, 
 
 Vose, 
 
 Desha, 
 
 M'Lean, of Ky. 
 
 Wallace, 
 
 Glasgow, 
 
 Milnore, 
 
 Ward, of Maw, 
 
 Goldsborough, 
 
 Newton, 
 
 Webster, 
 
 Goodwyn, 
 
 Noyes, 
 
 Whiteside, 
 
 Hahn, 
 
 Pickering, 
 
 Wilcox. 67 
 
 Hale, 
 
 
 
 Those who voted in 
 
 the negative, are, 
 
 
 Messrs. Adgate, 
 
 Messrs. Edwards, 
 
 Messrs. M'Kee, 
 
 Alexander, 
 
 Forney, 
 
 Middleton, 
 
 Archer, 
 
 Forsyth, 
 
 Moore, 
 
 Atherton, 
 
 Gaston, 
 
 Moseley, 
 
 Baer, 
 
 Gholson, 
 
 Murfrey, 
 
 Bateman, 
 
 Gold, 
 
 Nelson, of Mas*. 
 
 Betts, 
 
 Griffin, 
 
 Nelson, of Va. 
 
 Boss, 
 
 Grosvenor, 
 
 Ormsby, 
 
 Bradbury, 
 
 Hawes, 
 
 P arris, 
 
 Brooks, 
 
 Henderson, 
 
 Pickens, 
 
 Brown, 
 
 Huger, 
 
 Piper, 
 
 Bryan, 
 
 Hulbert, 
 
 Pleasants, 
 
 Calhoun, 
 
 Hungerford, 
 
 Powell, 
 
 Cannon, 
 
 Ingham, 
 
 Reynolds, 
 
 Champion, 
 
 Irwin, of Pa. 
 
 Robertson, 
 
 Chappell, 
 
 Jackson, 
 
 Schenck, 
 
 Chipman, 
 Clark, ofN. C. 
 
 Jewett, 
 Kerr, of Va. 
 
 Sharp, 
 Smith, of Md. 
 
 Clendenin, 
 
 King, of N. C. 
 
 Smith, of Vir. 
 
 Comstock, 
 
 Love, 
 
 Southard, 
 
 Condict, 
 
 Lowndes, 
 
 Tate, 
 
 Conner, 
 
 Lumpkin, 
 
 Taul, 
 
 Creighton, 
 
 Maclay, 
 
 Taylor, S. C. 
 
 Crocneron, 
 
 Mason, 
 
 Telfair, 
 
 Cuthbert, 
 
 M'Coy, 
 
 Thomas, 
 
ON THE GRANT OF THE CHARTER OF 1816. 
 
 Messrs. Throop, Messrs. Wheaton, Messrs. Wm. Wilson, 
 
 Townsencl, Wilde, Woodward, 
 
 Tucker, Wilkin, Wright, 
 
 Ward, of N. Y, Willoug-hby, Yancey, 
 
 "Ward, ofN. J. Thos. Wilson, Yates 91. 
 Wendover, 
 The amendments of the Senate were then, after some ineffectual attempts 
 
 to amend them, severally concurred in. 
 
 The bill was approved by the President, JAMES MADISON, on the 10th of 
 April, 1816, and constitutes the present charter of the Bank of the United 
 States, 
 
CHAPTER VI. 
 
 PROCEEDINGS AFTER THE BANK WENT INTO OPERATION. 
 
 HOUSE OF REPRESENTATIVES. 
 
 Mr. Spencer's Resolution and Report. 
 
 NOVEMBER '25, 1818. 
 Mr. SPENCER, of N. Y., ottered the following resolution: 
 
 '"Resolved, That a committee be appointed to inspect the books and exam 
 me into the proceedings of the Bank of the United States, arid to report whe- 
 ther the provisions of its charter have been violated or not; and, particularly, 
 to report whether the instalments of the capital stock of the said bank have 
 been paid in gold and silver coin, or in the funded debt ot the United States; 
 or whether they were, in any instance, and to what amount, paid by the pro- 
 ceeds of the notes of stockholders, discounted for that purpose; and also, to re- 
 port the names of those persons \vho now own, or who have owned, any part 
 oi the capital stock of the said bank, and the amount of discounts, if any, to 
 such persons, respectively, and when made; and also to report whether the said 
 bank, or any of its offices of discount and deposite, have refused to pay the 
 notes of the bank in specie, on demand, and have refused to receive in pay- 
 ment of debts due to tnem or either of tnem, the notes of the bank, and whe- 
 ther the bank or any of its offices of discount, or any of their officers or agents, 
 have sold drafts upon other offices, or upon the bank, at an advance, arid 
 have received a premium for such drafts; also, the amount of the notes is- 
 sued, payable at Philadelphia, and at each office of discount, respectively, and 
 the amount of capital assigned to each office,toether with the amount of the pub- 
 lic deposites made at the bank and at each office, and an account of the trans- 
 fers thereof; and the total amount of bills and notes discounted by the bank 
 and its several offices since its organization. That the said committee have 
 leave to meet in the city of Philadelphia, and to remain there as long as may 
 be necessary; that they shall have power to send for persons and papers, and 
 to employ the requisite clerks; the expense of which shall be audited and al- 
 lowed by the Committee of Accounts, and paid out of the contingent fund of 
 this House." 
 
 On the 30th of November, the resolution was agreed to by the House, and 
 a committee appointed, consisting of Mr. Spencer, Mr. Lqwndes, Mr. Mc- 
 Lane, Mr. Bryan, and Mr. Tyler. Mr. Bryan was, at his request, after- 
 wards excused, and Mr. Bur well substituted in his place. The result of the 
 investigations of this committee appears in the following report, made to the 
 House by Mr. SPENCER, on the 16tn January, 1819: 
 
 The committee appointed to inspect the books, and to examine into the pro- 
 ceedings of the Bank of the United States, with directions to report thereon, 
 and to report whether the provisions of its charter have been violated or 
 not, respectfully report: 
 
 That, under the leave granted by this House, the committee repaired to 
 Philadelphia, and there personally inspected the books of the bank; and as a 
 further means of examining its proceedings, they interrogated, on oath, the pre- 
 sident, the cashier, all the directors of the bank, whose attendance could be 
 obtained, and several of its clerks and officers. Examinations also have been 
 
REPORT OF COMMITTEE, 1819. 715 
 
 made at the offices at Baltimore, at Richmond, and at the City of Washing- 
 Ion, in order to obtain specific information upon certain subjects on which the 
 books of the parent bank were necessarily deficient. From these inquiries, 
 conducted with great labor, and, the committee trust, with great care, they 
 have collected a 'mass of information which they now submit to the House, 
 and which will be referred to in the course of this report. This information 
 consists of tables, statements, and extracts, made by the committee from the 
 books of the bank, or by them compared with those books and verified; and oi 
 the testimony of witnesses, and of letters from the president ol the institution. 
 
 The committee are aware that, from these sources ol' information, various 
 important inferences may be drawn, and upon them the most interesting opi- 
 nions may be predicated. It has been their intention, however, to go no far- 
 ther than was required by the resolution of the House, to avoid speculative 
 opinions upon general subjects, and to confine themselves to what they deem- 
 ed practical objects ol' inquiry, which they settled among themselves, previous 
 to entering upon the investigation. 
 
 These objects seemed to divide themselves into two classes; those which 
 related to the general management of the bank and the conduct of its officers; 
 and those which were connected with the question of a violation of its charter. 
 
 As to the general management of the concerns of the institution, among the 
 points of inquiry which appeared to be most immediately interesting, were 
 those which related to the refusal ol the bank and its offices to pay its notes in 
 vperie, at any other place than that where they were made payable, and 1o the 
 jr;.> lice of selling drafts on each other. 
 
 It appears that the directors of the bank, on its first institution, and up tr> 
 tin- -JHth of August, Mis, strenuously endeavored to redeem its notes at all its 
 olfices, indiscriminately, north of the city of Charleston. On the 7th day of 
 January. 1*17. it commenced operations by discounting notes on pledged 
 stock, "and to stockholders only, and by the issue of its bills. The officer then 
 at t!ie head of the Treasury Department, had repeatedly urged the commence- 
 ment of opera! ions, with the laudable view, as it appears, of hastening the re- 
 demption by the State banks, of their notes in specie. Vide letters from the 
 Secretary of the Treasury to the president of the Bank of the United States, 
 of the 15th August and 39th November, 1816, marked 1, 2. Efforts on the 
 part of the. treasury to induce tiie local banks to that measure, appear to have 
 been abortive, until th- IJank of the United States made certain propositions, 
 which induced negotiations between it ami the State institutions, which finally 
 resulted in a compact contained in the resolutions of the board of directors, 
 of the 31st January, 1817, herewith submitted, and marked 3. And in order 
 10 exhibit how far the hank complied with the compact, a statement of the 
 loans made, and of notes issued, up to the 20th February, 1817, is submitted, 
 marked -1. 
 
 It can be necessary only to refer to the state of the paper currency of the 
 country at this period. The notes of the State banks were variously depre- 
 ciated: soMie as much as twenty per C2nt., while others were at a premium. 
 The ex, essive issue of paper by the local banks, had caused an unnatural and 
 artificial depreciation of such paper, which required only time, and moderate, 
 but steady reductions, to restore, not to an uniform par. but to its true value, 
 ruder these circumstances, tiie Hank of the United Mates had, on the last of 
 February, 1817, (vide statement marked 5") $8,818,000 due to it from the State 
 banks at Philadelphia, New York, and Baltimore. With such a credit, con- 
 stantly accumulating by the transfer of the treasury funds, and by the pay- 
 ment of its second instalment in the notes of the State banks, it was in the 
 power of the Bank of the United States to have coerced the local institutions 
 into a moderate and reasonable reduction of their circulating notes. An at- 
 tempt to do so was made by the compact, 3, and. although the Bank of the 
 United States appears to have been anxious to effect the object, it did not per- 
 severe in this design. By 'its subsequent, acts, it improvidently afforded a 
 temptation, to the Western banks particularly, to extend their circulation of 
 notes, by insisting on its branches paying out their own notes in preference to 
 
716 BANK OF THE UNITED STATES. 
 
 those of the State banks, and on their delivering drafts on the eastern ci- 
 ties, whenever it could be done, to prevent the remittance of their own notes. 
 The branch noies and the drafts issued in consequence of these instruc- 
 tions, were swept away by the facility of remittance th*s unwarily given, as 
 well as by the ordinary balance of trade. A vacuum in the circulation was 
 thus produced, which could be supplied only by the local notes, which were 
 readily received by the offices of the Bank ot the United States, and wen* 
 retained ^by them as a fund upon which interest was charged to the State 
 banks. The letter of the president, marked 6, exhibits the course pursued by 
 the bank in this respect. 
 
 The Bank of the United States received from the treasury the notes of the 
 local institutions, in many cases, as special deposites, to be paid out in similar 
 bills. From April, 1817, to this time, the amount so received, appears from 
 statement 7, to be $2,752,750, of which 87,341 continues on hand, leaving 
 $2,665,409 as the amount voluntarily assumed by the Bank of the United 
 States. The committee have not found any evidence of the bank having at- 
 tempted to oppress the State banks, either by wanton demands of specie, or 
 by the rejection of their notes. Much complaint has, indeed, existed, but in 
 the instances which have come to the knowledge of the committee, the State 
 banks have been in the wrong, and some of them at the westward have refused 
 the most equitable propositions of the bank, and have met its demands for its 
 just dues, with complaints and reproaches. It was not intended to trouble 
 the House with any of the various letters which have passed on that subject, 
 but as the president of the bank transmitted a letter from the office at. 
 Charleston, exhibiting the conduct of the local banks at that place, it is pre- 
 sented to the House, marked 8. 
 
 The committee are of opinion that, instead of conducting with the alleged 
 rigor towards the State banks, the Bank of the United States is liable to the 
 more serious charge of having increased the amount of notes in circulation, by 
 its acceptance of them in those places where it was known they would not be 
 redeemed in specie, and by making them, in the manner beforementioned, the 
 only circulating medium in that part of the country. Its forbearance to the 
 State banks is vindicated 0*1 the ground of its being the only means to induce 
 their resumption of specie payments. This effect, if really owing to that 
 cause, has been proved to have been but temporary, and experience has shown 
 that, at the same time, or soon after the refusal of the Bank of the United 
 States to receive the notes of its offices, many of the State banks began to sus- 
 pend and evade their specie payments. 
 
 So long as the notes of each office were payable at all the others, and the 
 office issuing them was not exclusively liable for their redemption, the dis- 
 counts at those places, against which there was a balance of trade, became 
 larger in proportion to their indemnity against demands. As the notes of the 
 offices were rapidly carried off, the payment of these discounts was necessa- 
 rily made in the notes of the local institutions. And thus it was one inevita- 
 ble effect of the old system, to increase the debts of the State banks to the 
 offices of the Bank of the United States, at these places. The demands of the 
 bank were suffered to accumulate improperly, instead of being gradually re- 
 duced, as specie was required at other offices, and in small quantities, that 
 would not have been felt. Their reduction was not insisted upon sufficiently 
 early; and, when the bank began to call for specie, its demands were so con- 
 siderable as not only to expose the local banks, but the citizens in their vicini- 
 ty, generally, to very severe pressure. 
 
 By substituting the credit of individuals for the payment of the second in- 
 stalment, which will be presently stated, instead 01 coin or the notes of State 
 banks, the Bank of the United States, in a great measure, deprived itself of 
 the early and prompt check which the possession of those notes would have 
 afforded, to the more extensive increase of local paper. In July, 1817, the 
 debts due from the State banks are reduced to $3,972,000, while the notes of 
 the Bank of the United States, in circulation, amounted to $4,754,000, by 
 which it might have been subjected to embarrassments arising from the calls 
 
REPORT OF COMMITTEE, 1819. 
 
 of the local institutions. The committee think it evident, from this result, 
 that the bank did not exercise, with sufficient energy, the power which it pos- 
 sessed and might have retained, but rather afforded inducements to the State, 
 banks to extend the amount of their circulating notes, and thus increased one 
 of the evils it was intended to correct. 
 
 In answer to an inquiry, addressed by the committee, on this subject, to the. 
 president of the bank, they were furnished with his views, and a letter from 
 the office at Boston, marked 9, and were referred to a report of the committee 
 of directors, on the 28th August, 1818, marked 10. These documents exhibit 
 the reasons of the bank for adopting the resolution of that (late, by which the 
 notes of the offices were refuged acceptance. In the letter of the Boston office, 
 much stress i* placed upon the larg'i accumulation of paper, and of drafts at 
 Boston, issued by the southern and western offices, and this became an im- 
 portant object of inquiry. The books of the parent bank do not furnish infor- 
 mation respecting the drafts made by and upon the offices, excepting those, 
 which were made on it. And the committee have not ascertained their amount 
 except at the offices in Baltimore and this city. From the local situation of 
 Baltimore, the statements obtained at that office, marked 11, 12, may be con- 
 sidered as furnishing sufficient proof of the correctness of the opinion express- 
 ed by the Boston office. To the office at Boston, its debt fluctuated between 
 34,000 and 215,000 dollars, until May last, since which it has been indebted 
 to Baltimore from 500 to 57,000 dollars. Its debt to ihe office at New York 
 has varied from 100,000 to 1,947,000 dollars, and, until October last, it ha- 
 generally owed that office more than 1,500,000 dollars. At that time the New 
 York office was brought in debt to Baltimore 97,278 dollars; its deb! in No- 
 vember last was 10,948 dollars. The explanation of these extraordinary re- 
 ductions of the Baltimore debts is given from the circumstances of treasury 
 drafts on the JVbr/A being delivered directly to the Baltimore office, or sent to 
 it through the office at this city: and, by a check on New York for more than 
 a million, given by the parent bank in payment of foreign bills of exchange, 
 hereinafter mentioned. The Baltimore debt to the parent bank has varied 
 from 1,500,000 to 9,000,000 of dollars, and h;i> generally exceeded 6,000,000. 
 Notwithstanding these heavy debts to New York, Boston, and Philadelphia, 
 the drafts of the Baltimore office on those places continued uninterrupted and 
 excessive in amount. That office was originally supplied with notes to the 
 amount of 872,000 dollars, and had returned to it from Philadelphia 1,697,000 
 dollars in its notes, and yet it is stated by the teller, that it never had a suffi- 
 cient quantity of notes to meet its demands; that they did not remain twenty- 
 four hours in the office, but were constantly remitted to the North, with the 
 drafts which it issued. And there can be no doubt, on a comparison of the 
 statements referred to, connected with these facts, that the drafts from Balti- 
 more, given for the proceeds of notes discounted, were unwarrantably large, 
 and much more than the balance of trade required. In a letter of the presi- 
 dent, dated June 27, 1817, to that office, he observes, " the directors, consi- 
 dering (among other things mentioned) the low state of the specie and indi- 
 vidual deposites at your office, and the magnitude of your discounts, and those 
 at this bank, as well for Baltimore as this place, and the very inadequate and 
 disproportioned amount of discounts to which the office at New York has been 
 restricted, inconsequence of the daily and excessive drafts from your office 
 and this bank, which has become the subject of just animadversion," direct 
 that the then amount of discounts should not be exceeded. The same lan- 
 guage is held in other letters, 12, 14. But it terminated in unavailing remon- 
 strances; the Baltimore office continued its drafts and its discounts, and 
 drained the specie from the Northern offices. And such was the want of 
 firmness, or of foresight, in the parent board, that, after finding its repeated 
 remonstrances disregarded, it never removed one of the offending directors, 
 and took no effectual step to control them, until the adoption of the general 
 resolutions of August 28, 1818, forbidding the offices to draw on each other. 
 
 The effect of these excessive drafts on the northern offices was, to compel 
 the constant remittance of specie there; to cripple them in all their operations: 
 
718 RANK OF THE UNITED STATES. 
 
 to limit their discounts to a trifling amount; to cause the revenue paid there, 
 and which would itself have been a capita! far business, to be drawn south- 
 ward; thus compelling them to deny to the debtors of the Government any 
 indulgence or accommodation in their payments; to bring those offices into 
 debt with the State banks; to produce ageneral depression of credit, and a 
 severe pressure for money. Those places were, in fact, made tributary to 
 Baltimore, and all their means and energies were required to supply its ex- 
 travagant issues. 
 
 A sudden reduction of the Baltimore debt to the northern offices, appears 
 to have taken place in March and April last, and, within a few months past, 
 those offices have been brought in debt to it. This is accounted lor by the 
 cashier of that office, by saying, that it arose principally from treasury drafts, 
 and by the sales of foreign bills of exchange. Drafts were given by the 
 treasury, ir some instances, and to considerable amounts, directly to Balti- 
 more, on the northern offices, and, in other instances, such drafts went through 
 the office in this citv. It is not to be presumed that those drafts were given 
 by the treasury with a knowledge of all the circumstances, or with a view to 
 draw the revenue collected at the north to Baltimore, merely to aid that office 
 in paying its debts. Yet such was the effect; and, although it enabled Balti- 
 more to continue its large discounts, it impoverished the northern offices, and 
 the cities where they were established were, made to feel the pressure. The 
 Baltimore debt to the parent bank will be found to have regularly increased 
 xvith the reduction of its debts to the other offices, until it remitted 1,007,000 
 dollars in bills of exchange on London, which remittance is connected, by the 
 testimony of .]. W. McCulloch, Esq. with the negotiation explained in the 
 letter of the President, 15. The loan which resulted from that negotiation 
 was on a pledge of stock, that had been pledged at Baltimore. The bank as- 
 sumed it, and received the bills of exchange, and paid for them by giving a 
 check on the New York office for the amount, at the time the Baltimore office 
 was indebted to the parent bank more than six millions of dollars. 
 
 It might have been supposed, that the pressure of the Baltimore office upon 
 those more north, was owing to its being pressed by the southern and western 
 offices. The fact will, however, appear from the table 1 1, that, until Septem- 
 ber last, it was indebted to the office at Lexington; that the debts of Cincin- 
 nati, Chillicothe,and Louisville to it, were small in amount, and that the only 
 office which has constantly owed it, is New Orleans, and that not to a large 
 amount until lately. 
 
 From these facts it would seem to result, that the embarrassments of the 
 Bank of the United States, in receiving the notes of all its offices, did not arise 
 so much from the fair and ordinary balance of trade which might have been 
 calculated and provided for, as from the excessive discounts granted at some 
 of the offices, particularly Baltimore and Philadelphia, and the drafts conse- 
 quent upon those discounts which were made upon the other offices. From 
 the correspondence of the bank with its offices, it is obvious that this was the 
 opinion of the directors and the officers; it is distinctly assigned as one of the 
 grounds for refusing the notes of the offices, in the report of the committee, 10; 
 and it is more strongly urged in the letter of the Boston office, submitted and 
 adopted by the president, 9, and is eloquently enforced in several of his let- 
 ters. 
 
 This committee is not prepared to say that an uniformly equal currency 
 could have been maintained by the bank, under the most auspicious circum- 
 stances; they are inclined to the opinion, that such an attempt would be hope- 
 less. But they consider its abandonment at. the time, as having been produced 
 by the causes before stated. The efforts of the bank to meet the payment of 
 its notes at all its offices, north of Charleston, were certainly great, and par- 
 ticularly at New York and Boston, as will appear from the resolutions mark- 
 ed 1C, and the account of specie remitted, 17. The relinquishment of the 
 attempt was involuntary and reluctant. 
 
 From the testimony of the cashier and tellers of the bank, of the teller of 
 the Bank of North America, and of the cashierand teller of the office at Bal- 
 
REPORT OF COMMITTEE, 1819. 
 
 timoie. it \vill appear very satisfactorily, that the. conduct of (he bank and 
 that office, in adopting the new system of refusing the notes of the. branches, 
 was "perfectly fair and equitable- That the bank and the Baltimore office, 
 promptly paid and received all the notes of the other offices which they had 
 paid out previous to the change of system, whenever application was made for 
 the purpose; ami thai, in no instance, have they refused to dp so. Injury pro- 
 bably was suffered by those who had received the depreciated notes in the, 
 usual course of business, but the committee cannot perceive how the bank 
 could have changed its system in any mariner less injurious to itself, and less 
 inconvenient to the public, than that which was adopted. 
 
 From this change of system, which placed the notes of the offices on the 
 same footing with those of the local banks in their vicinities, resulted a great- 
 er difference in the exchange between the different parts of the Union. The 
 oflices at New Orleans, Savannah, and Charleston, had never been included 
 in the plan of equali/.iim the currency. They had always been left to their 
 own discretion in receiving or refining the notes of the other office* In May, 
 1817, the. oflices at Charh-.-ton and Savannah were authorized to draw on 
 lhn*e at the North, at a premium. In April, 1S17. those at Lexington and 
 Cincinnati were authorized to purchase bills on the Eastern and Northern 
 cities. In December, 1HI7. the Southern offices were authorized to draw, at a 
 premium, on those, at the. North. In October and November, 1817, the 
 Western offices were authorised to draw, at a premium, on Philadelphia 
 and the oflices south of it. And it appears the offices at Lexington and 
 Cincinnati were, before February, 1818, in the practice of drawing on 
 the Kastern cities. These facts show, that the bank and most of its of- 
 ficer- M>ld drafts upon each other, long before the adoption of the resolu- 
 tion of asth .Vugu-f, 181X. refusing the notes of the offices, and cslal>li>h 
 that, while the bank was attempting to equal'r/.e the currency by the pay- 
 ment of it.- notes at all it* oflices north of Charleston, it was, at the same 
 time, selling drafts between those offices at a premium. A system of do- 
 mestic exchange was adopted by the bank on the 18th July, 1817, marked 1H. 
 It contains some provisions which appear exceptionable, but as the plan ncter 
 \\as acted upon, it is not deemed necessary to notice them. 
 
 It has been impracticable for the committee to asi ertain the amount or the 
 rates of drafts sold by, and upon, the oflices. On examination of the 
 books of the parent bank, it appears that drafts were sold by it on Charles- 
 ton, New Orleans, and Savannah, within a few days of each olher. at very 
 different rates: on one day, at one per cent., and on another day, at five per 
 cent., on the same office. It would be in vain to account for these fluctua- 
 tions. 
 
 However dangerous to the community may be the power of selling drafts 
 in the hands of an institution whose resources maybe adequate to the control 
 of domestic exchange, according to its interests or its caprices, yet the 
 committee cannot entertain a doubt that the bank possesses the power. Kx- 
 < epting the fluctuations before noticed, the rate of premium has not hitherto 
 been extortionate in any instance which has come to the knowledge of the 
 committee. The proceedings of the bank and its officers, and the reasons and 
 views entertained by them, are exhibited in the report, 18, in the letter of the 
 president, 19, and in extracts from his correspondence, 20. 
 
 Various opinions are entertained on the expediency of the bank's selling its 
 drafts. While many suppose that it would consult its own dignity and in- 
 (nest, in refraining from the practice, and would receive an equivalent for the 
 loss of premium, in the confidence and support of the commercial commu- 
 nity, by delivering its drafts gratuitously, when it was convenient to draw 
 at all; others contend that the system of gratuitous drafts would open an 
 avenue to favoritism, and, at all events, would expose the bank to the charge 
 in a greater degree than if it sold its drafts. Without expressing any opin- 
 ion on these subjects, upon which the commercial community is much divided, 
 and to which the attention of the committee has not been particularly direct- 
 ed, they content themselves with observing that, if drafts are sold, they 
 
720 BANK OF T11K UMTK1) STATES. 
 
 ought to be ai fixed, known, and permanent prices, not exceeding the expense 
 of transportation of specie or the fair agio of business. The want of these 
 fixed prices, in the bank and its officers, appears, to your committee, censurable- 
 Connected with the subject of exchange, is that of dealing in the notes of 
 the State banks. In a letter of the president to the Charleston office, which 
 received the sanction of the board of directors, marked 21, an opinion 
 in favor of the legality and propriety of such purchases, is expressed. No 
 evidence, however, has been obtained, that they have actually been made. 
 The practice, in the opinion of the committee, would be highly improper and 
 dangerous, and contrary to the spirit, if not the words, of the ninth funda- 
 mental article. 
 
 Among the resolutions of the directors, are two on the subject of dis- 
 counts on a pledge of stock, marked 22, 23, passed the 18th and 27th 
 December, 1816. These resolutions obviously contemplate only discounts 
 to stockholders, and one avowed object was to facilitate the payment 
 of the specie part of the second instalment, which was ten dollars on a share, 
 and to be paid by the 23d January, 1817. The loans were to be confined to 
 the proportion ot the coin part of the second instalment, on the shares which 
 had been subscribed at the places where offices were then in operation, New 
 York, Boston, and Baltimore. The total amount of these loans, to pay the 
 specie part of the second instalment on the 20th of February, 1817, at Phila- 
 delphia, was one hundred and ninety-nine thousand nine hundred and twenty- 
 one dollars and thirty-seven cents, and at Baltimore, at that date, 'was one 
 hundred and thirty -eight thousand three hundred and twenty dollars. 
 
 The committee have not obtained information of the amounts at New York 
 and Boston, but they are informed by the officers of the bank, that the discounts 
 at those places were to a very trifling amount, if any. The committee can 
 see no reason to justify these premature efforts to aid the payment of the 
 second instalment before it fell due, and before the experiment war; made to 
 ascertain how much could be paid in specie. Those efforts do not appear to 
 have been very successful, for eight hundred and thirty-nine thousand eighty- 
 five dollars, only, were paid during the month of January. 1817, while one 
 million seventy- eight thousand three hundred and nineteen dollars were paid 
 after that period, the greatest proportion in May and June, as will appear from 
 an abstract prepared by the committee, and now submitted, marked 21, 
 The amount paid by checks also appears, from that abstract, the most, 
 if not the whole of which, were to draw the proceeds of notes discounted for 
 the purpose. And it appears, in many instances, particularly in one related 
 in Mr. M'Euens' testimony, hereinafter referred to, and in another referred 
 to in the President's letter of May 27th, 1817, marked 25, that the 
 directors did not confine themselves to the amount prescribed in the resolu- 
 tion of the 27th December, that is, to the proportion of the coin part of the 
 second instalment, but discounted to the full par value of the stock which 
 was paid for by the proceeds of the same discounts, and the discount, the pay 
 ment of the second instalment, the payment of the price to the owner, the 
 transfer, and the pledge of the stock, were, as it is termed, simultaneous acts. 
 All the discounts on stock, after the 20th February, 1817, were made at the 
 par value of the shares, which enabled the discounter not only to pay the 
 whole of his instalments, including the specie part and the funded debt part, 
 but also to draw out of the bank the amount which might have been paid in 
 on his shares. It is alleged, in justification of these discounts, that specie 
 bore a very high premium, and that the bank could not have commenced busi- 
 ness, unless that the mode of obtaining the specie payment had been adopt- 
 ed. With respect to the price of specie, it appears to have been, at Philadel- 
 phia, six per cent, on the 6th January, 1817, arid about the same price in Bal- 
 timore, and that it had been much higher. Admitting, however, that the 
 price w r ould have been much enhanced in consequence ot its being understood 
 that the coin payment on the second instalment would be rigidly exacted, yet 
 the committee cannot perceive the justice of enabling some of the stockholders 
 to evade that payment, and the consequent loss ot the premium on specie, 
 
REPORT OF COMMITTEE, 1819. 721 
 
 while the majority had been compelled to incur the same loss, in order strictly 
 to comply with tne law and their engagements; particularly unjust was it to 
 (nose who resided at such a distance from the bank that they could not avail 
 themselves of the privilege granted. And the injustice appears the greater 
 when it is known, that the expense of the specie afterwards imported by the 
 bank, in order to supply the deficiency produced by the evasion it had autho- 
 rized, was assessed equally upon those stockholders who had neglected to pay, 
 upon those who had already, at a considerable loss, furnished their quota of 
 coin, and upon the Government. Seven millions was the whole sum required 
 to foe paid in coin; the specie part of the first instalment, amounting to one 
 million lour hundred thousand dollars, was paid; of the two millions eight 
 hundred thousand dollars which was to have been paid at the second instal- 
 ment, it is impossible 4o say what amount was actually paid in coin. The 
 statement before referred to, marked 24, will show the payment in coin 
 at Philadelphia, and abstract, marked 26, will exhibit the nominal pay- 
 ments on all the instalments, of which thirteen millions eight hundred 
 and seventy-two thousand six hundred and ten dollars was paid by the stock- 
 holders in funded debt, (exclusive of the seven millions subscribed by the 
 Government) instead of twenty-one millions which were required by the law; 
 and fourteen millions one hundred thousand one hundred and sixty-seven dol- 
 lars was paid, as stated in the abstract, in coin. But, in that abstract, a check 
 on the bank, or on other banks supposed to pay specie, is deemed a payment in 
 coin. And, as the payments on the second instalment continued to be made 
 and received for six months and more after it was due, and as, during that 
 time, large discounts on stock were constantly made, it is obvious that the 
 abstract cannot be relied on as exhibiting the actual amount paid in specie; 
 nor, on the other hand, could the whole amount of the discounts on stock be 
 considered as having been applied to the payment of the second instalment- 
 By statement marked B, referred to in the cashier's answer, ancl by this com- 
 mittee marked 27, it appears that the discounts, on the 30th July, 1817, 
 on pledged stock, amounted to eight millions forty-six thousand nine 
 hundred and thirty-two dollars; of this amount, a part was applied fo the pay- 
 ment of the third instalment, and a pail was drawn out of the bank by the 
 discounters. A large portion of it, is believed, however, to have been used to 
 pay the second instalment. 
 
 Of the $2,800,000 which was to have been paid at the third instalment, it 
 is believed that a very trifling amount was paid in coin, and as little of the 
 funded debt; but that nearly the whole of both were paid by the proceeds of 
 notes discounted on the pledge of stock. 
 
 The total amount of specie imported from Europe by the bank, since its in- 
 stitution to this time, appears, by statement marked 28, to be $7,311,750 53; 
 the expense of which, including interest, premium, and $20,000 paid to the 
 agent for going to London, amounts to $525,297 38. The contract made for 
 a part of that specie, and the authority to Mr. Sergeant, the agent, are submit- 
 ted, marked 29, 30. To the reason urged by the officers of the bank, that 
 such was the scarcity of specie that it could not have been obtained, and that, 
 without facilitating the payments, by making discounts, the bank could not 
 have gone into operation, the committee observe that they are at a loss to per- 
 ceivehow the simple act of discounting could make the specie more plenty; 
 that, if it was not actually in the bank at the time of making these discounts, 
 the checks of the discounters could not be considered as equivalent to specie. 
 
 The amount of specie in the Bank of the United States, in February, 1817. 
 was $1,724,109; $324,000 more than the coin part of the first instalment, and 
 which may fairly be presumed to have been received for the second instalment 
 If, then, the checks of stockholders, founded upon discounts, were equivalent 
 to specie, they were by them authorized to draw out of the bank the very 
 coin which had been paid in by other stockholders, in order to pay it into the 
 bank again, for their own benefit, and to complete the payment of the specie 
 part of the second instalment an operation of more potency in creating spe- 
 cie, than was ever ascribed to the fabled finger of Midas. The general state- 
 91 
 
722 BANK OF THE UNITED STATES. 
 
 ment, in February, 1817, shows that the total amount of bills discounted, was 
 $2,930,067, making an excess of $1,205,958 of discounts over the specie in 
 the bank; from which it would result, that the checks for the proceeds of those 
 discounts were not in all cases equivalent to specie. 
 
 As to the difficulty of the bank going into operation without those discounts 
 being made to facilitate the payment of the second instalment, it is not per- 
 ceived how that measure removed the difficulty: for it is obvious that it (lid 
 not add a single cent to the specie in the vaults of the institution. What 
 other difficulty than the want of specie, the bank had to encounter, is not 
 known, as all other obstructions seem to have yielded almost without an effort. 
 The eft'ect of those discounts was very obviously to enable those who had 
 made large purchases to retain their stock without paying for it, and to derive 
 a benefit from its probable advancement in price. Had the bank rigidly re- 
 quired the payment of the instalments, the large stockholders must have sold 
 that portion of their shares which their real means did not enable them to 
 hold. Or, if the bank had not exacted the instalments, and had not afforded 
 the means of substituting credit for payment, the stock would not have ad- 
 vanced materially in price, and the large holders of it would have had no in- 
 ducement to retain it. In either event, a more equal diffusion of the shares 
 would have been the consequence, and it would have reached the hands of 
 solid capitalists, who woulcl have held only what they could pay for. It is 
 believed that the loss of the dividends, and the liability to pay interest on the 
 instalments due, would have been sufficient to compel even the stockjobber 
 to sell. Although, if those discounts had not been made, the immediate pro- 
 fits of the bank would not have been so large, yet it would not have had an 
 unwieldy capital to manage^ it could have proceeded gradually, growing with 
 the growth, and strengthening with the strength of the nation, as it emerged 
 from the evils of the flood of paper issued by the local institutions. The bank 
 could have felt its way, and increased its means with the increasing demands 
 of the country. Such a cautious proceeding would have enabled it to render 
 invaluable service in checking the issue of State banks, and bringing them to 
 the alternative of avowed bankruptcy, or to the permanent resumption of spe- 
 cie payments. The evil of the country was the immense amount of bank 
 notes and credits; the Bank of the United States increased it by its credits 
 to stockholders. That course did indeed enable the directors to declare a 
 lar^e dividend; but that the apparent prosperity was temporary and fallacious, 
 is demonstrated by the recent dividend of two and a half per cent. 
 
 It might have been supposed, as it has been urged, that the discounting on 
 stock was the only means, in the power of the bank, to enforce the payment 
 of the second instalment. It is believed that the engagement on the part of 
 the stockholders could have been enforced without difficulty by the courts of 
 law. Decisions to that effect have been made in the courts of the States of 
 Pennsylvania, Massachusetts, and New York; and when the stockholder's 
 note was taken without an endorser, or any other collateral security, but the 
 pledge of the stock, it is not perceived how his legal liability was increased. 
 In the sale of the stock pledged, there was indeed a prospect of indemnity, 
 which depended, however, wholly on the price of shares in the market. The 
 same circumstances that prevented the actual payment of the instalment 
 would have interposed, it is presumed, to obstruct the liquidation of the note 
 given in lieu of it; and in the emergency which would have compelled the 
 bank to reduce its discounts, it wouicf most require a good price for the stock; 
 and the very necessity of the times which would force an unusual quantity of 
 it into the market, would probably defeat the object of security. In fact, a 
 large part of the amount thus discounted, was not paid at the maturity of the 
 note, vide statement 27, but was renewed. Of the still larger proportion 
 which appears from that statement to have been paid, it is wholly impossible 
 to determine what part was converted into notes on personal security, or what 
 part assumed the new shape which was given to notes discounted on pledged 
 stock, after (he 20th February, 1817. It ought to be remarked, that many 
 persons, after finding the disposition of the board, obtained discounts, who 
 
REPORT OF COMMITTEE, 1819. 723 
 
 were perfectly prepared to pay, and would have paid their instalment?, if the 
 inducements to credit had not been offered them. 
 
 Had the bank resorted to its remedy, through the courts, to obtain the pay- 
 ment of the second instalment, it would probably have obtained something 
 from the stockholder; it could have lost nothing, and at all events, it would 
 have saved the dividends upon the delinquent stock. But, by taking the note 
 of the owner, it admitted that the instalment was paid, and abandoned the 
 means of coercion given by the charter, in withholding the dividends, and ob- 
 tained nothing; it did not increase the responsibility of the stockholders, while 
 it exposed the bank to the certain loss of the dividends, and to the chance of 
 loss, if the stock should be forced into the market in large quantities. 
 
 The committee are of opinion that the resolutions, and the practice of dis- 
 counting before mentioned, were incorrect. That they were particularly ob- 
 jectionable, from their partial operation in affording facilities to some stock- 
 holders, which could not be enjoyed by those residing at a distance; even at 
 Richmond, the stockholders made their payments, for the second dividend, 
 in funded debt, and in coin which probably was purchased at a premium. 
 The committee find it difficult to reconcile these resolutions with the views 
 proposed in their adoption, and are satisfied that they were connected inti- 
 mately with the measures calculated to aft'ect the price of stock, and particu- 
 larly with discounts of a similar character, soon after made. 
 
 One of the acts, obviously intended to give the bank stock a high price in 
 the European market, was the establishment of an agency there, to pay the 
 dividends. On the 28th November, 1816, a resolution was passed, by the cast- 
 ing vote of the president, and against the report of a committee, who had 
 been appointed to consider the subject, authorizing John Sergeant, Esq. to 
 make arrangements in Europe for the payment of the bank dividends at the 
 par of exchange, and at the risk and expense of the bank. Such an arrange 
 ment was made, by which it was stipulated to make the payment six months 
 after the dividends were declared. The papers on this subject are marked 
 39, 40, 41. How far it was objectionable thus to afford inducements to fo- 
 reigners to become interested in our stock, and, serni-annually, withdraw 
 from the country the amount of the dividends, the committee do not under- 
 take to decide, as they consider it one of those general and abstract subjects, 
 to which the resolution of the House does not direct their attention. But, 
 thus to compel American stockholders, and the Government, to contribute to 
 the possible loss of paying the dividends to those abroad, appeai-s to be un- 
 just. The nearly equal division of the directors, on this important subject, 
 and the able reasons assigned in the report of the committee against the mea- 
 sure, ought at least to have prevented the precipitate adoption of the resolu- 
 tion: and when the committee find among the eleven who voted in the affir- 
 mative, the names of some directors who have been constantly and largely 
 engaged in the purchase and sale of stock, and that, of the ten who voted in 
 the negative, not one has been ascertained to have dealt in those transactions, 
 they are almost irresistibly impelled to the conclusion, that the measure was 
 adopted more with a view to enhance the price of shares, than for the perma- 
 nent benefit of the institution. 
 
 The practice of discounting on stock, to the full amount paid upon the 
 shares, appears to have commenced early at the parent bank, under the fourth 
 by-law, which is similar to the fifteenth regulation for the government of the 
 offices, both of which were adopted at the commencement of the institution. 
 They authorize discounts without an endorser, on the stock of the bank, on 
 the funded debt of the United States, or such other property as shall be ap- 
 proved, when pledged to an amount sufficient to secure the payment of the 
 note. By a statement referred to in the cashier's examination, 27, it appears 
 that the total amount of discounts on pledged stock, up to the 30th July, 1817, 
 was $8,046,932 64, of which there had been paid, at that time, $2,815,665 04. 
 These loans, it is presumed, were made chiefly at Philadelphia, as the Balti- 
 more loans on stock had not commenced to a large extent at that time. On 
 the 25th of July, 1817. a resolution, marked 31, was adopted, authorizing the 
 

 724 BANK OF THE UNITED STATES. 
 
 offices to discount notes secured by a pledge of bank stock or funded debt, 
 with a recital that it might be desirable to many persons to obtain temporary 
 loans on such pledges, and a form of the pledge was directed to be transmit- 
 ted; it is marked 32. These notes had no endorser, and the discount was, 
 in tact, made upon the credit of the stock: for, by a resolution of the 30th of 
 September, 1817, marked 33, the President and cashier were authorized, in 
 
 the note and hypothecation of the person to whom stock might lie transferred, 
 and on which loans at par had been made. 
 
 By the resolution of 26th August, 1817, marked 35, discounts to stock- 
 holders were authorized at one hundred and twenty-five dollars per share, 
 upon presenting collateral security for the twenty- five dollars. The provision 
 requiring an endorser or collateral security for the excess above the par value, 
 was, m many instances, and to very considerable amounts, effectually evaded, 
 by some of the largest borrowers becoming endorsers for each other. The al- 
 leged reasons for the resolution are, that bank shares had been discounted upon, 
 at one hundred and twenty dollars, by the local institutions in New York; 
 and that it was necessary, in order to employ the capital which had been in- 
 creased beyond the ordinary means of using it advantageously, by the redemp- 
 tion of eleven millions of the public debt. The practice of other banks would 
 not, in the opinion of your committee, afford any justification of the measure; 
 and when that practice was to be urged as a reason, the directors ought at 
 least to have been correctly informed of the fact. The committee addressed 
 inquiries to the several banks in the city of New York, and from their answers 
 it appears, that, in two or three instances only, discounts have been made on 
 the bank shares; that those notes never were renewed, and that, in no instance, 
 has any bank there discounted on the shares of the Bank of the United States 
 above their par value; and, although pains have been taken to ascertain the 
 fact, no evidence has been discovered of any other bank having made dis- 
 counts on stock above its par value. 
 
 The redemption of the eleven millions of public debt was effected by the 
 application of that amount of deposites to the credit of the Government, then 
 in the vaults of the bank. Much unfounded and unnecessary complaint ap- 
 pears to have been made by the officers of the bank against this very prudent 
 measure. That it disappointed the expectations of tho^e who calculated on 
 receiving interest from the Government, while they discounted on its money, is 
 very probable and very natural; and it is not surprising that some expedient 
 should have been resorted to, in order to supply another equivalent source of 
 profit. But there were other resources besides the stock of the bank. The 
 Government stock was better security, and although it was uniformly above 
 par, the directors seem never to have thought of discounting upon it above its 
 par value. They began by rating it at ninety for every hundred dollars, while 
 they were discounting on their own shares at par. By a resolution, passed 
 20th May, 1817, marked 37, the Government stock was rated at par, and, 
 soon after, bank shares were discounted upon at $125 for every $100, with an 
 endorser for the excess. 
 
 The committee are surprised to find so little good business paper done at the 
 bank and its offices, where it was to have been reasonably expected that the 
 merchants would have preferred transacting their business. The directors, 
 themselves, avow, that they uniformly gave a preference to stock notes over 
 bi siness paper; their reasons are contained in their examinations. But when 
 the complaint is, that the bank had more capital than it could employ, it is 
 singular that any business paper should have been rejected. In July, 1817, 
 that kind of paper, to the amount of $940,000, and in August, to the amount 
 of about $493,500, was rejected at Philadelphia; and at Baltimore, in July, 
 about $407,000, and in August, about $183,000 were rejected. These sums 
 are not precisely accurate, but are sufficiently so for general views. Whether 
 this paper was such as ought to have been rejected, the committee have no 
 
REPORT OF COMMITTEE, 1819. 
 
 means of determining. The amounts rejected are probably not more than 
 might be expected from a bank doing business on such an extensive scale, at 
 any other time than \vhen it was anxious to employ its capital. Not an in- 
 stance has occurred of a note, secured by the pledge of stock, being rejected. 
 On the 9th January, 1817, the board resolved, (paper marked 36) from and 
 after the 20th February then next, and to the 1st of July, to discount notes to 
 those who should have revenue bonds to pay during that period. The amount 
 done under that resolution was small, and it does not appear that such notes 
 have at any time been discounted extensively. 
 
 The principal business of the bank certain!/ has been to discount on notes 
 secured by a pledge of stock, under the various resolutions before recited. 
 Their effect was to abandon all personal security, and to rely entirely upon 
 the stock pledged a system which your committee think need only to be 
 stated to ensure unqualified reprehension. Besides the objection which arisei 
 from these loans being in their nature perpetual after all personal security was 
 abandoned, it appears to have been an act of self-immolation, thus to place 
 beyond the reach of the institution, in the event of an emergency to which it 
 and all others are liable, so large a portion of its loans. On the 20th October 
 last, a statement was made, exhibiting the amounts discounted on notes se- 
 cured by a pledge of the bank stock, and then remaining unpaid at the follow- 
 ing places: at Philadelphia, $4,680,600, of which $173,450 was above the par 
 value; at Baltimore, $2,402,435, of which it cannot be ascertained what pro- 
 portion was above the par value, but it is believed to have exceeded $500,000} 
 at Charleston, $897,429, of which $2,000 was above par; at Washington, 
 $298,570, of which but a small amount was above par; at Richmond, $209,840, 
 and none above par. There are no accounts from the other offices, the di- 
 rectors having required statements only from those whose discounts on stock 
 exceeded $100,000. A statement has been furnished by the bank, of the 
 amount discounted at the above places, and remaining unpaid at this time, 
 marked 42, which differs somewhat, but not materially, from the statement* 
 in October last. By that statement, the total amount ot discounts at the bank, 
 and at those offices, on pledged stock, is $8,022,954; and by the general state- 
 ment, on the 1st December last, the total amount of such discounts at the bank 
 and all its offices, is $8,934,712; the difference between which sums is the 
 amount discounted at all the other offices not above enumerated. The com- 
 mittee havj compiled a statement, 43, which exhibits, among other things, 
 the total amount of discounts at the bank and all its offices, at different pe- 
 riods, on personal security and on pledged stock; from which it will appear 
 that the largest amount discounted on bank stock was in January and Febru- 
 ary, 1818, when it was $11,244,51 4. 
 
 From this recital it will be apparent how large a portion of the capital of 
 the bank was thus placed beyond its control. Although there have been some 
 fluctuations in the amounts of those discounts, at different periods, yet the 
 greatest part of them, indeed the whole, with but few exceptions, have been 
 constantly renewed, from time to time, as the notes fell due, in many cases 
 at four and six months. Indeed, every subsequent act of the bank has been 
 wholly at war with the profession of these loans being temporary, held out in 
 the recital of the resolution of 25th July, 1817, marked 31. And in order to 
 ensure the greatest amount of such loans, and, at the same time, afford facili- 
 ties to the prompt purchase and sale of stock, the directors, on the 8th of Au- 
 gust, 1817, passed a general resolution, authorising the President and cashier 
 to discount all stock notes that should be offered between discount days, to a 
 certain amount, and by various resolutions, adopted at different meetings, un- 
 til 7th September, appropriated two millions of dollars to their disposal for 
 that purpose. The papers referred to, are marked 44; and on the 30th Sep- 
 tember, 1817, the resolution already referred to, marked 33, passed, author- 
 izing those officers, in all cases, to renew the stock notes as they fell due, 
 between discount days. 
 
 Another, and probably much more censurable effect of these various reso- 
 lutions and proceedings, was to keep the price of the stock constantly ad- 
 
726 BANK OF THE UNITED STATES. 
 
 vancing, until it reached a point where it exploded and fell. From various 
 sources of information, the committee have compiled a table of the prices of 
 stocks at the different periods when these resolutions were adopted, marked 
 45, from which their effect in enhancing the price of shares is very clear- 
 ly exhibited. It will appear from that table, that the price of shares at 
 Philadelphia, on the 20th August, 1817, was, according to the public reports, 
 $147 50; according to the testimony of Mr. M'Euen, a broker, it was $144; 
 at the same place on the 30th of the same month, the price was $156 50. The 
 resolution authorizing discounts on stock at $125, was passed on the 26th of 
 the same month, vide 35. These facts would, in the opinion of your com- 
 mittee, be sufficient to condemn a system which thus enabled a stockjobber 
 to sport with the property of others. Stockjobbing, to an immense extent, 
 and wages on the price 01 shares, were its inevitable consequences. It gave 
 equal facilities to the bankrupt, who had not credit enough to obtain an en- 
 dorser, and to the capitalist. Stock could be, and was, purchased without 
 the advance of a cent by the purchaser, who had only to apply to the direc- 
 tors, or to the president and cashier, between discount days, for a loan on the 
 shares about to be bought, and, by what is termed a simultaneous operation, 
 he obtained his discount, and with it paid for his stock. A rise in the market 
 would enable him to sell his shares, pocket the difference, and commence 
 operations anew. And the committee are compelled to state, that, in fact, the 
 largest loans on pledged stock were made to brokers, and to individuals who 
 appear to have been constantly in the market. Loans on stock, at a rate be- 
 low its par value, may unquestionably be useful to the merchant, who would 
 avoid the obligation imposed by requesting an endorser, and would be highly 
 beneficial to the bank when restrained within moderate limits and not made 
 permanent. But the loans actually made, were, most of them, unreasonable 
 and excessive in their amount; they were not made to the merchant and 
 trader, but to a few persons, consisting of directors, brokers, and speculators; 
 and have been renewed and continued almost invariably, at the option of the 
 borrower. And when, in July last, the board directed a curtailment of its dis- 
 counts, it fell, in almost all cases, on the business paper, while the immense 
 amounts loaned on stock pledges were but little affected, excepting at the 
 offices at Richmond and Washington, where the curtailment appears to have 
 fallen equally on all the notes. But the discounts at those places on stock 
 were very small, particularly when compared with Baltimore, where the 
 loans were such and so long continued as to receive the animadversions of the 
 parent board . 
 
 An unwillingness to injure the private credit of those engaged in the above- 
 mentioned transactions, where no public good is perceived to be probable 
 from the disclosure, induces the committee to withhold the mention of their 
 names. But, in respect to the directors, the committee consider their conduct 
 intimately connected with the general management of the concerns of the 
 bank. And under a sense of the duty devolved upon them, they state, that 
 many of the directors, as well those appointed by the Government, as those 
 elected by the stockholders, appear to have been the most forward and the 
 most active in trafficking in stock. The mere purchasing shares, with an in- 
 tention to' retain them, would not be improper, even in a director, if made with- 
 out any view to intended future proceedings of the board of which he was a 
 member. But the practice of purchasing at one time, when the stock was 
 low, and selling at another, after its price had been enhanced by the measures 
 adopted by the directors, is 'certainly unfair and censurable. It is the per- 
 version of a public and honorable trust, to the purposes of self : aggrandizement, 
 and places the directors in a situation where their own interests afford a 
 strong temptation to the abuse of that trust. Still more reprehensible is the 
 conduct ot those directors who made contracts for the purchase of stock, de- 
 liverable and payable at a future period, at a low rate, and, during the inter- 
 mediate time, by their own official acts, raised the price of the stock to its 
 highest point. The committee do not deem it necessary to repeat the details 
 which will be found in the examinations of the directors and officers herewith 
 
REPORT OF COMMITTEE, 1819. 727 
 
 submitted, marked 52, 53. By comparing these examinations with the prices 
 of stock hereinbefore referred to, the House will be enabled to perceive which 
 of the directors have participated in this business. With respect to the pub- 
 lic directors, considering them public officers, responsible to the Govern- 
 ment, and subject to the constitutional power of this House, the committee 
 deem it their duty to state, that the President, William Jones, Esq. and 
 George Williams, Esq. appear, from their own declarations, and from the tes- 
 timony of a number of witnesses, to have been deeply concerned in these 
 speculations. , Mr. Jones appears to have purchased one thousand five hun- 
 (fred and fifty five shares, at a high rate, and to have sold a large part of them 
 at a loss. He states that, in the summer of 1817, he purchased a contract of 
 one thousand shares, at one hundred and thirty-two dollars per share, deli- 
 verable 2d January, 1818, and soon after, another contract for one thousand 
 shares, deliverable in November following, at one hundred and thirty-five 
 dollars per share, both of which, he says, were sold at one hundred and fifty 
 dollars per share; from which two contracts, it would appear, he realized 
 $33,000. There is much ambiguity resting on these transactions, arising from 
 the incompatible statements ot Mr. Jones, Mr. George Williams, Mr. Den- 
 nis A. Smith, and Mr. James W. M'Culloch. The three latter gentlemen 
 appear to speak of the same contracts and purchases, but give accounts of 
 them somewhat variant from that of Mr. Jones. Particularly Mr. Dennis 
 A. Smith and James W. M'Culloch, speak of one of those contracts, or of 
 some other, as having been presented to Mr. Jones, gratuitously, after the 
 stock had risen, and it was obvious that a profit would be realized, of which 
 Mr. Jones makes no mention. Mr. Jones states that he sold both those con- 
 tracts to D. A. Smith; Mr. Smith says he was one of the persons who made 
 one of the contracts a present to Mr. Jones; that the stock never was trans- 
 ferred, and that the profit, amounting to $15,000, was paid to Mr. Jones, in 
 money. Although the precise time is not specified by Mr. Jones, yet it is ob- 
 vious, irom the rate at which the contracts were purchased, that it must have 
 been sometime anterior to the 26th August, 1817: for, at no time after that pe- 
 riod, during the year 1817, was stock so low as $135. That the resolution ot 
 that date, authorizing discounts on stock, at twenty- five per cent, above its 
 par value, had an immediate effect on its price, will have been seen from a 
 former part of this report. 
 
 The committee do not hesitate to say, that, although his motives may have 
 been strictly correct, and his vote given without any reference to his private 
 interest, yet, his situation forbade his acting on a question, whose result was 
 so important to him; or rather, that he ought never to have placed himself in 
 that situation. The high trust reposed in the president of a national bank, by 
 the Government, and by the representatives of the stockholders, required that 
 he should abstain from all concerns in which the price of stock was material. 
 Mr. Jones appears to consider those transactions as lawful private concerns; 
 the committee deem them intimately connected with the public management of 
 the institution; of their lawfulness and propriety it is for the House to judge. 
 
 Mr. George Williams, another public director, appears to have been deeply 
 concerned in the purchase of stocK, and in the making and purchase of con- 
 tracts, for the delivery of stock, to a large amount. Every witness that has 
 been examined, speaks of Mr. Williams' transactions in that respect. Mr. 
 Williams himselt declined statins, the amount and prices at which he pur- 
 chased, and the committee did not mink proper to insist upon his answers, as 
 they had already obtained satisfactory information respecting his conduct, and 
 examined him chiefly to give him the opportunity of making such explanations 
 as he thought proper, of which he was advised at the time. With respect to 
 the other public directors, Messrs. Pierce Butler, and John Connelly, it sa- 
 tisfactorily appears that they \vere not in the least concerned in the stock- 
 jobbing transactions. And, with respect to Walter Bowne, although his resi- 
 dence in New York did not give the committee the same means of informa- 
 tion, yet no evidence has been discovered to implicate him. 
 
728 BANK OF THE UNITED STATES. 
 
 Jonathan Smith, Esq. the cashier of the bank, has had considerable deal- 
 ings in the purchase and sale of stock, and in making and purchasing contracts 
 for its delivery at future periods. The remark is applicable to J. W. M'Cul- 
 loch, Esq. the cashier of the office at Baltimore, to a much greater extent. Al- 
 though those gentlemen might have no direct agency in me measures which 
 were to affect the price of stock, yet the influence of their stations ought to be 
 great, and it is to be lamented that they should have placed themselves in a 
 situation where the exercise of that influence might be ascribed to improper 
 causes. With respect to the other directors, their examinations will enable 
 the House to determine how far they have mingled in these transactions. 
 
 Besides the objection which has already been urged to the resolution of the 
 8th August, 1817, authorizing the president and cashier to discount notes, as 
 being connected with a series of proceedings, evidently calculated to enhance 
 the price of stock, by affording facilities to the making prompt purchases, it is 
 still more objectionable as being a delegation of power, which, in the opinion of 
 your committee, the directors had no right to grant. And when connected 
 with the power also given them of indefinite and unlimited renewal of stock 
 notes, it was placing the great bulk of the capital entirely within their control. 
 The same practice appears to have been almost universal at the office in Balti- 
 more, where the president and cashier, as appears by *heir examinations, have, 
 under the authority of the board of directors at that place, always discounted 
 notes without an endorser, secured by a pledge of stock. As they were not 
 restricted by the board, they appear accordingly to have exercised the power 
 to a very considerable extent. Still more reprehensible, in the opinion of 
 your committee, is the practice at that office, of allowing the president and 
 cashier to purchase or discount drafts and bills, payable from sight to sixty 
 days, because, in such discounts, the personal security is the most important 
 circumstance. It has been done to a very large amount, although no loss ap- 
 pears yet to have accrued. At Richmond, an equally improper delegation of 
 power to the cashier appears to have been granted, in authorizing him to dis- 
 count notes on pledged stock, at sixty days, and afterwards, a similar authori- 
 ty to discount at four months. After an experiment of three weeks, the di- 
 rectors of that office had the wisdom to abandon it, vide papers 46. At the 
 office in this city, the power has been discreetly limited, and as discreetly ex- 
 ercised. 
 
 Two by-laws of the bank seem to your committee to deserve notice, one 
 of them, that no discounts shall be made without the consent of three fourths 
 of the directors present, and another, that no director shall, without special 
 authority, be permitted to inspect the- cash account of any person with the 
 bank. These by-laws appear to render nugatory the provisions of the char- 
 ter, authorizing the appointment, by the Government, of one-fifth of the whole 
 number of directors ? and are different from the provisions, in that respect, by 
 the former Bank ot the United States, although most of the local banks in 
 Philadelphia have similar regulations. Should a state of things exist, in 
 which the stockholders should deem their interest hostile to that of the nation, 
 such provisions as these stated, would render the Government directors 
 mere spectators of the proceedings of the board. 
 
 The committee endeavored to obtain a statement of the shares upon which 
 the instalments had not been paid, and of the persons owning them. The of- 
 ficers of the bank satisfied them that, from the irregular manner in which the 
 accounts of the payments had been made, it was impossible to obtain an accu- 
 rate statement. But the fact is admitted, that the dividends have been paid 
 to some delinquent stockholders, who are few, and to whom but a small a- 
 mount of stock belongs. The dividends have been uniformly paid to those 
 stockholders whose notes were discounted to the full par value of the stock, 
 with the proceeds of which they paid their instalments, including the funded 
 debt part as well as the specie part. The injustice of this proceeding, to- 
 wards those who had really paid their instalments, according to their engage- 
 ments, and who received no more benefit from these payments than those 
 stockholders who substituted their stock in the place ot specie and funded 
 
REPORT OF COMMITTEE, 1819. 729 
 
 debt, is most obvious. The stock that had really never been paid for, but 
 which remained pledged for the very credit given it, was entitled to draw, 
 ttnd did draw, as much dividend, as that which had been fairly and punctually 
 paid. 
 
 The root and source of all these instances of misconduct was the illegal 
 and reprehensible division of the stock. By the first fundamental article of 
 the charter, no person, co-partnership, or body politic, shall be entitled to 
 more than thirty votes; and yet, in violation of this provision, it will appear, 
 from the testimony ot Thomas Leiper, George Williams, Dennis A. Smith, 
 ;;nd James \V. M'Culloch, that it was a common and general practice, well 
 known to the judges of the election and to the directors, to divide shares into 
 small parcels, varying from one to twenty shares to a name, held in the 
 names of persons who had iio interest in them, and to vote upon the shares 
 thus held, as attorneys lor the pretended proprietors. By some of the wit- 
 nesses it is avowed, that the object was to influence the election. Air. Leiper, 
 one of the judges of the first election, states that he did so himself. The ef- 
 fect was, that Baltimore, which had about one-seventh of the shares owned 
 by individuals, gave more than one-fourth of all the votes that could be given, 
 in that place there were 1172 shares taken in 1172 names, by George Wil- 
 liams, as attorney, the whole of which, it appears from his examination, he own- 
 ed. At Philadelphia nearly one, third of the shares was owned, and the 
 votes given at that place were about two-ninths of the whole authorized. 
 Fora more particular knowledge of these divisions of shares, the committee 
 refer to the statement herewith submitted, marked 47. They are not aware 
 that any remarks which could be made by them, could present the subject in 
 a stronger light than the above statement of facts. The same persons who 
 thus held the power of appointing directors, are found to have the greatest 
 loans on stock. It is alleged that they have now consolidated the shares; 
 but when occasion shall require their division, former practice will facilitate 
 the operation. In the opinion of the committee, it is the greatest evil in the 
 whole system, and is the origin of all others. So long as the large stockhold- 
 ers can control the choice ot directors, so long can they hold and acquire im- 
 mense amounts of stock, by the proceeds of notes discounted on the shares; 
 and so long as they can obtain such discounts, they can control the election of 
 directors. The system places the property of the other stockholders, and of the 
 Government, the credit of the bank and of individuals, and, in a measure, that 
 of the nation, at the mercy of a few large stockholders, who, without having really 
 contributed to the wealth or the value of the institution, have the control of 
 its concerns. It requires a corrective, and the committee are of opinion that 
 it is in the power ot Congress to pas-, a supplementary law, not contrary to, 
 but in support of, the provisions of the, charter, and to give it the true and real 
 effect originally contemplated. And they have instructed their chairman to 
 ask for leave to report a bill prepared for that purpose. 
 
 The committee deem it their duty, also, to submit to the House a resolution, 
 marked 48, authorizing a discount of a note for $20,000 at sixty days, and di- 
 recting that the discount should be paid in a post note drawn payable at sixty 
 days alter date. It is stated by the cashier, in his examination, that that post 
 note was made payable in Philadelphia. They find also a resolution of the 
 30th January, 1817, marked 19, expressly authorizing the office at Baltimore 
 to grant discounts to the amount of $100,000, to be paid in post notes, at sixty 
 days' date. There is no doubt entertained that this was done at Baltimore, from 
 its subsequently asking permission to do more, although, from the manner in 
 which the books of that office are kept, it would be difficult to ascertain the fact. 
 The only circumstance which throws any doubt on these transactions bein- 
 deemed usurious, is, that, instead of exacting more than lawful interest, the bank 
 has charged and received interest on money that it never loaned. Not being 
 drafts on other offices, they cannot be considered as exchange operations. 
 As the parties have a remedy in the courts of justice, for any injury they may 
 have sustained, the committee do not deem it necessary to recommend any 
 provision on the subject. 
 92 
 
730 BANK OF THE UNITED STATES. 
 
 Under the resolutions authorizing discounts on pledged stock, a form of 
 pledge was adopted, marked 23 A, and under the resolution of July 25th, 
 1817, another form was adopted. marked 32, both of which were used by those 
 obtaining loans. Although the latter form is in the shape of a mortgage or hy- 
 pothecation, yet the. equitable interest in the stock was in the bank. It might 
 be questioned whether a stockholder could vote upon his shares, which had 
 been actually transferred in that form. It does not appear that any objec- 
 tions have been, made to such votes, but that they have been received without 
 scruple. 
 
 It will be found difficult to reconcile with the ninth fundamental article of 
 the charter, a resolution of the 24th June, 1817, by which the board resolved 
 to purchase two millions of public debt, as the agent of the commissioners of the 
 sinking fund, and to deliver it to them at par. That resolution, and a letter of 
 the president of the bank, announcing its purchase, with a statement of its cost, 
 are submitted, marked 50, a, b, c. From these it will appear, that the bank 
 had sold two millions of its debt in England, with which to purchase specie. 
 The Secretary of the Treasury claimed the right to redeem it, under the 
 provisions of the charter; and after some negotiations, a compromise was ef- 
 fected by the bank undertaking to purchase two other millions, in lieu of that 
 sold, and to deliver it at par. The idea of its purchasing as the agent of the 
 commissioners, is exploded, when it is discovered that the stock cost it. 
 $2,054,264 26, which it was bound to deliver at par, by which a loss was 
 produced of $54,254 26. It would be a novel idea, that a mere agent was to 
 do the business of his principal solely at the expense of the agent. And it is 
 obvious, from the whole transaction, that the purchase was really on account 
 and for the benefit of the bank, to enable it to maintain its faith with the pur- 
 chasers of the debt sold in England. The apology for the bank is, that it was 
 done under the sanction of a high officer of the Government: and although the 
 committee feel bound to say that it was a violation of the article before quot- 
 ed, yet, under all the circumstances, considering that it was done in good 
 faith, they do not, themselves, think it such a violation as requires the interpo- 
 sition of Congress. 
 
 On. the subject of the facilities furnished by the bank to the Government, 
 in the transmission and collection of the public revenue, and its fulfilment 
 of its engagements, in discharging the duties of commissioners of loans, and 
 agent for military pensions, the accompanying letter of the Secretary of the 
 Treasury, marked 51, shows that its conduct has been satisfactory. 
 
 There appear to have been some contentions between the parent board and 
 some of its officers, but the committee have not deemed them sufficiently con- 
 nected with any practical objects of inquiry to justify their going into the 
 merits of those controversies, which would be a work of much time and labor, 
 arid would not repay the trouble; and it would be unjust to make, any state- 
 ment respecting them, without making it in detail. 
 
 In order to give to this House full information of the state of the bank since 
 its institution, a statement, exhibiting its condition at different periods, mark- 
 ed 43, and various tables and statements compiled by the committee, or by 
 them verified, are submitted; among them will be found statements of notes 
 issued payable at each office, and of notes returned to the offices, respectively: 
 reports of the committee of directors, previous to each dividend; a complete 
 list of the stockholders of the bank; No. 1 exhibiting the names of those who 
 were such at the first dividend, with their places of residence, and the num- 
 ber of shares held by them, respectively, at that time, and at each subsequent 
 dividend. No. 2 exhibiting the names of those who became stockholders 
 after the first dividend; and No. 3 exhibiting those who became stockholders 
 after the second dividend, together with a list of those who hold shares as at- 
 torneys for others. Other letters and miscellaneous documents, not specially 
 referred to in the preceding part of this report, but elucidating the facts stated, 
 will also be found. 
 
 Statements, obtained from the offices at Richmond and this city, are also 
 submitted, which will show that the affairs of those offices have generally 
 
REPORT OF COMMITTEE, 1819. 
 
 Veen conducted with prudence and ability, and that every effort was made by 
 them to execute the directions of the parent board, in a manner the least in- 
 convenient to their customers. 
 
 In considering the question, whether the charter of the bank has been vio- 
 lated or not. the committee have thought that the expressions used, mean, 
 whether, in any instance, the provisions of the charter have not been complied 
 with, There may be many violations of a charter, which would not be con- 
 sidered, by a court of law, as producing a forfeiture. The principle on that 
 subject the committee believe to be this: those acts of usurpation of powers 
 not granted, of mis user and of non user of those granted, which defeat the 
 very objects of the institution, as expressed in the charter itself, would pro- 
 duce a forfeiture; and that all other instances of abuse of the powers granted, 
 or of usurpation of powers, must be punished or restrained, either by the or- 
 dinary process of mandamus and quo warranlo* or by other means than a dis- 
 solution of the corporation. The committee think they are required by the 
 resolution to report all instances of a violation of the provisions of the char- 
 ter, which have come to their knowledge; but they do not consider themselves 
 <:alled upon to slate which of them would, in their opinion, produce a for- 
 feiture, or any olher legal consequences. And one inducement to this con- 
 struction of the resolution arises from the consideration, that, if they were to 
 coniine themselves only to those violations which would produce a forfeiture, 
 and they should give a mistaken or incorrect opinion, that the charter had not 
 been violated >o as to induce a forfeiture, the House might, under a strict 
 construction of the act, be precluded from expressing any other opinion, 
 and from directing the proceedings contemplated by it; whereas, by reporting 
 all instances of violation that have occurred, without reference to their tech- 
 nical character, the House is left free to pursue any course it may judge pro- 
 per. In speaking, therefore, of violations of the provisions of the charter, the 
 committee wish to be understood as not expressing any opinion, whether such 
 violations would enure a forfeiture or not. They present the facts, and the 
 House will determine whether, under those facts, it be or be not expedient to 
 direct the issuing a scire facias, to ascertain whether the violations are such 
 as to cause a dissolution of the corporation. 
 
 The committee, then, are of the opinion, that the provisions of the charter 
 of the Bank of the United States have been violated, in the following instances: 
 
 L In purchasing two millions of public debt, in order to substitute them 
 for two other millions of similar debt, which it had contracted to sell, or had 
 sold, in England, and which the Secretary of the Treasury claimed the right 
 of redeeming. The facts on this subject, and the views of the transaction en- 
 tertained by the committee, have been already given. 
 
 2. In not requiring the fulfilment of the engagement made by the stock- 
 holders, on subscribing, to pay the second and third instalments on the stock 
 in coin and funded debt. The facts on this point are fully before the House, 
 and they establish, beyond all doubt, 1st. That the directors of the bank 
 agreed to receive, and did receive, what they deemed an equivalent for coin, 
 in checks upon, and the notes of the bank, and other banks supposed to pay 
 specie. This substitution of any equivalent whatever, for the specific things 
 required by the charter, was, in itself, a departure from its provisions; but, 
 2d. The notes and checks thus received were not, in all cases, equivalent to 
 coin, because there was not specie to meet them in the bank. 3d. That notes 
 of individuals were discounted, and taken in lieu of the coin part of the second 
 instalment, by virtue of a resolution for that purpose, passed before that in- 
 stalment became due. 4th. That the notes of individuals were taken, in many 
 instances, and to large amounts, in lieu of the whole of the second and third 
 instalments, which notes are yet unpaid. 
 
 3. In paying dividends to stockholders who had not completed their instal- 
 ments; the provisions of the charter, in that respect, were violated. 
 
 4. By the judges of the first and second elections allowing many persons 
 to give more than thirty votes each, under the pretence of their being attor- 
 neys for others, in whose names shares then stood; when those judges, the di- 
 
732 BANK OF THE UNITED STATES. 
 
 rectors and officers of the bank, perfectly well knew (hat these shares really 
 belonged to the persons offering to vote upon them as attorneys. The facts, in 
 relation to this violation, are in the possession of the House, and establish it 
 beyond the reach of doubt. 
 
 The committee are of opinion, that no other instance of a violation of the 
 charter has been established. 
 
 In closing this report of a most laborious investigation, the committee ob- 
 serve, that, whatever difference of opinion can exist among them, as to the 
 results and inferences to be drawn from the facts stated, they unanimously 
 concur in giving to the preceding statements of facts, and abstracts of docu- 
 ments, their sanction. They have not recommended the adoption of any im- 
 mediate measures ta correct the many evils and mischiefs they have depicted. 
 
 the institution, they shall adopt no means to prevent its continuance, or the 
 directors themselves shall persist in a course of conduct requiring correction, 
 the committee cannot entertain a doubt that the salutary power lodged in 
 the Treasury Department will be exerted, as occasion may require, and with 
 reference to the best interests of the United States. 
 
 It is due to the officers of the bank at Philadelphia to state, that every fa- 
 cility in their power was rendered in explaining the books, and assisting the 
 researches of the committee. 
 
 [This report was accompanied by a volume of documents, vouchers, and 
 tabular statements, comprising near five hundred pages, which may be found 
 among the reports of committees made in the House of Representatives, at 
 Ihe second session of the fifteenth Congress, being volume marked two of the 
 Reports of Committees,] 
 
 Mr. TRIMBLE'S RESOLUTION, 
 
 JANUARY 19, 1819, 
 Mr. TRIMBLE, of Kentucky, submitted the following resolution: 
 
 Resolved, That the Attorney General of the United States, in conjunction 
 with the district attorney of Pennsylvania, shall immediately cause a scire 
 facias to be issued, according to the twenty-third section of the "Act to in- 
 corporate the subscribers to the Bank of the United States," calling on the 
 corporation, created by said act, to show cause wherefore the charter, thereby 
 granted, should not be declared forfeited; and that it shall be the duty of the 
 said officers to cause such proceedings to be had in the premises, as shall be 
 necessary to obtain a final judgment thereon, for the expenses ot which Con- 
 gress will hereafter provide." 
 
 Mr. SPENCER'S RESOLUTION FOR A SCIRE FACIAS, &c. 
 
 FEBRUARY 1, 1819. 
 Mr. SPENCER, of New York, submitted the following resolution: 
 
 Resolved by the Senate and House of Representatives of the United 
 Stales of America in Congress assembled, That the Secretary of the Trea- 
 sury shall cause all the public deposites in the Bank of the United States and 
 its several offices of discount and deposite to be withdrawn, on the first day 
 of July next; that, after the said day, the bills or notes of the said corpora- 
 tion shall no longer be receivable in any payments to the United States; and 
 the Attorney General of the United States shall, on that day, or as soon there- 
 after as may be, cause a scire facias to be sued out, in contormity to the pro- 
 
MH, SPENCER'S RESOLUTION, 1819. 733 
 
 visions of the "Act to incorporate the subscribers to the Bank of the United 
 States," calling upon the saitl corporation to show cause why its charter should 
 not be declared forfeited; unless the said corporation shall, by a legal act, to 
 be delivered to, and approved by, the Attorney General, and to be by him 
 transmitted to Congress, at the next session thereof, declare its assent to the 
 following propositions, on or before the said first day of July next, viz: 
 
 1st. That Congress may by law provide such means as may be necessary 
 to enforce the first fundamental article of the said charter, respecting the right 
 of voting for directors, and, particularly, to provide that transfers of stock 
 shall always be made to the real owners thereof, or to some person or persons 
 in trust for the owners, who shall ^always be named in such transfer; that 
 stock shall always be deemed to belong to the person or persons in whose 
 name it may stand, or for whose use it may be declared in the certificate to- 
 be held, and that no evidence whatever shall be received in any court to con- 
 tradict or explain the certificates of ownership. 
 
 2d. That Congress may provide for the reduction of the capital stock of 
 the bank, in a just and equal proportion, by the stockholders thereof, when 
 convened in a general meeting. 
 
 3d. That the power of removing any director lor misconduct, may be vest- 
 ed in the President of the United States. 
 
 4th. That the Bank may purchase not exceeding live millions of dollars of 
 the funded debt of the United States, and may hold the same, without being 
 subject to redemption, unless consented to by it, until the time or times spe- 
 cified in the certificates thereof. 
 
 5th. That no by-law of the corporation shall exclude the directors, appoint 
 ed by the Government, from a full knowledge of all the concerns of the bank, 
 and of the accounts of every person dealing with it, and that the assent of, at 
 least, one public director shall be necessary, to allow any discount, and to 
 render valid every act of the board of directors. 
 
 6th. That the provision, in the second fundamental article, prohibiting any 
 director from holding his office more than three years, out of four, in succs- 
 sion, may be modified or repealed by Congress. 
 
 7th. No discount shall, in any case, be made by the bank at Philadelphia, 
 or by any office, without the consent of, at least, four directors of the bank, 
 or or the office, as the case may be. 
 
 8th. Congress may authorize the bank to deal and trade in other things 
 than those enumerated in the ninth fundamental article, so far as to receive 
 pledges of its own stock, and of the funded debt of the United States, in se- 
 curity for loans, and to sell such pledges on a forfeiture thereof. 
 
 9th. That persons holding stock, upon which any instalment shall have 
 been paid by the proceeds of notes discounted, shall be compelled gradually, 
 and as soon as circumstances will admit, to pay the full amount of such in- 
 stalment in coin, or in coin and funded debt, according to the provisions of 
 the charter, and no dividend of profits shall be allowed to such stock, until 
 the said payment is completed. 
 
 10th. That the Secretary of the Treasury shall be permitted, at any time, 
 either in person, or by an agent, to be appointed by him, to inspect all the 
 books, papers, correspondence, minutes, and proceedings, of the board of di- 
 rectors of the bank, and of all its offices, and of all their officers. 
 
 llth. That Congress may extend the time for the payment of the whole, 
 or any part of the sum of 1,500,000 dollars, required to be paid by the 20th 
 section of the charter. 
 
 12th. That a scire facias maybe issued out of any circuit court in the 
 United States, in the cases stated in the charter; and, whenever it shall be 
 issued out of any court other than the circuit court of Pennsylvania, sworn 
 copies of the books and papers of the bank shall be received as evidence in- 
 stead of the originals. 
 
 The foregoing provisions, or any of them, may, at any time, be enacted 
 into a law or laws by Congress, and shall, thereupon, become a part of the 
 charter of the bank. 
 
734 BANK OF THE UNITED STATES. 
 
 MR. JOHNSON'S RESOLUTION FOR A REPEAL OF THE CHARTER 
 
 FEBRUARY 9, 1819. 
 
 Mr. JOHNSON, of Virginia, submitted the following resolution: 
 " Resolved, That the Committee on the Judiciary be instructed to report a 
 
 bill to repeal the act, entitled ' An act to incorporate the subscribers to the 
 
 Bank of the United States,' approved April 10, 1816." 
 
 The several preceding resolutions were referred to the Committee of the 
 whole House on the state of the Union; but, on motion of Mr. SPENCER, the 
 committee were discharged from the consideration of that presented by him, 
 and it was laid on the table. The resolutions of Mr. TRIMBLE and Mr. JOHN- 
 SON were considered and debated in committee, at great length, on the 24th 
 of February; and they having reported to the House their disagreement to 
 them, the House, on the 25th, affirmed the decisions of the committee, and 
 thereby rejected the resolutions. The vote on the resolution offered by Mr. 
 JOHNSON was as follows: for the resolution, 30; against it, 121. For Mr. 
 TRIMBLE'S resolution, 39; against it, 116. 
 
 The debate upon Mr. JOHNSON'S resolution is of an interesting character, 
 but far too voluminous to admit of insertion in these pages, which already ex- 
 ceed greatly the bounds originally designed tor them. It may, however, be 
 seen in the files of the National Intelligencer, of the following dates: 
 
 For the. speech of Mr. Johnson, of Va. see Intelligencer, of 23d March, 1819. 
 
 Do. do. Mr. Pindall,of Va. fct of 25th " *' 
 
 Do. do. Mr. Lowndes, S. C. " " of 27th " 
 
 Do. do. Mr. Tyler, of Va. of 6th April, " 
 
 Do. do. Mr.M'Lane,ofDel. " of 8th " 
 
 Do. do. Mr. Sergeant, of Pa. " of 10th " 
 
 Do. do. Mr. Pindall, of 13th " " 
 
 Do. do. Mr. Walker, of Ky. " of 15th " 
 
 In the annual message of the President of the United States, at the opening 
 of the twenty-first Congress, the following 6bservations occur respecting the 
 Bank of the United States: 
 
 " The charter of the Bank of the United States expires in 1836, and its 
 stockholders will, most probably, apply for a renewal of their privileges. In 
 order to avoid the evils resulting from precipitancy, in a measure involving 
 such important principles, and such deep pecuniary interests, I feel that I 
 cannot, in justice to the parties interested, too soon present it to the delibe- 
 rate consideration of the Legislature and the People. Both the constitution- 
 ality and the expediency of the law creating this bank, are well questioned, 
 by a large portion of our fellow-citizens; and it must be admitted by all, that 
 it has failed in the great end of establishing a uniform and sound currency. 
 
 ** Under these circumstances, if such an institution is deemed essential to the 
 fiscal operations of the Government, I submit to the vyisdom of the Legisla- 
 ture whether a national one, founded upon the credit of the Government, 
 anil its revenues, might not be devised, which would avoid all constitutional 
 difficulties, and, at the same time, secure all the advantages to the Govern- 
 ment and country that were expected to result from the present bank." 
 
 In the House of Representatives, 10th December, 1829: 
 
 "Resolved, That so much of said message as relates to the revenue, the 
 public debt, and the Bank of the United States, be referred to the Committee 
 of Ways and Means." 
 
REPORT OF COMMITTEE, 1830. 
 
 This committee consisted of Mr. McDuffie, Mr. Verplanck, Mr. D wight, 
 Mr. Smyth. Mr. Ingersoll, Mr. Gil more, and Mr. Ovorton. 
 
 On the 13th of April, succeeding, the following report was made: 
 
 Mr. M'DUFFIE, from the Committee of Ways and Means, to which the 
 subject had been referred, made the following report: 
 
 The Committee of Ways and Mean-, to whom was referred so much of the 
 Message of the President as relates to the Bank of the United States, beg 
 leave to report: 
 
 That .they have bestowed upon the subject all the attention demanded by 
 its intrinsic importance, and now respectfully submit the result of their de- 
 liberations to the consideration of the House. There are few subjects, having 
 reference to the policy of an established Government, so vitally connected 
 with the health of the body politic, or in which the pecuniary interests of so- 
 ciety are so extensively and deeply involved. No one of the attributes of 
 sovereignty carries with it a more solemn responsibility, or calls in requisi- 
 tion a higher degree of wisdom, than the power of regulating the common 
 currency, and thus fixing the general standard of value for a great commer- 
 cial community, composed of confederated States. 
 
 Such being, in the opinion of the committee, the high and delicate trust 
 exclusively committed to Congress by the federal constitution, they have pro- 
 ceeded to discharge the duty assigned to them, with a corresponding sense of 
 it.- magnitude and difficulty. 
 
 The most simple and obvious analysis of the subject, as it is presented by 
 the message of the President, exhibits the following questions for the deci- 
 sion of the National Legislature: 
 
 1. Has Congress the constitutional power to incorporate a bank, such as 
 that of the United States ? 
 
 2. Is it expedient to establish and maintain such an institution ? 
 
 3. Is it expedient to establish "a national bank, founded upon the credit of 
 the Government and its revenues?" 
 
 1. If the concurrence of all the departments of the Government, at differ- 
 ent periods of our history, under every administration, and during the ascen- 
 dency of both the great political parties, into which the country was divided, 
 soon after the adoption of the present constitution, shall be regarded as having 
 the authority ascribed to such sanctions by thejcommon consent of all well 
 regulated communities, the constitutional power of Congress to incorporate a 
 bank, may be assumed as a postulate no longer open to controversy. In little 
 more than two years after the Government went into operation, and, at a pe- 
 riod when most of the distinguished members of the federal convention were 
 either in the executive or legislative councils, the act, incorporating the first 
 bank of the United States, passed both branches of Congress by large majori- 
 ties, and received the deliberate sanction of President Washington, who had 
 then recently presided over the deliberations of the convention. The consti- 
 tutional power of Congress to pass the act of incorporation was thoroughly 
 investigated, both in the Executive cabinet and in Congress, under circum- 
 stances, in all respects propitious to a dispassionate decision. There was, at 
 that time, no organization of political parties, and the question was, there- 
 fore, decided by those who, from their knowledge and experience, were pecu- 
 liarly qualified to decide correctly, and who were entirely free from the influ- 
 ence of that party excitement and prejudice which would justly impair, in the 
 estimation of posterity, the authority of a legislative interpretation of the con- 
 stitutional charter. No persons can be more competent to give a just con- 
 struction to the constitution, than those who had a principal agency in fram- 
 ing it; and no administration can claim a more perfect exemption from all 
 those influences which, sometimes, pervert the judgments, even of the most 
 wise and patriotic, than that of the Father of his Country, during the first 
 term of his service. 
 
/ 
 
 736 BANK OF THE UNITED STATES. 
 
 Such were the circumstances under which all the branches of the National 
 Legislature solemnly determined that the power of creating a national bank 
 \yas vested in Congress by the constitution. The bank, thus created, con- 
 tinued its operations for twenty years the period for which its charter was 
 granted during which time public and private credit were raised from a 
 prostrate to a very elevated condition, and the finances of the nation were 
 placed upon the most solid foundation. 
 
 When the charter expired, in 1811, Congress refused to renew it, princi- 
 pally owing, as the committee believe, to the then existing state of political 
 parties. Soon after the bank was chartered, the two great parties that have 
 since divided the country, began to assume an organized existence. Mr. Jef- 
 ferson and Mr. Madison", the former in the Executive cabinet, and the latter 
 in Congress, had been opposed to the establishment of the bank, on constitu- 
 tional grounds, and being placed at the head of the party most unfavorable to 
 the extension of the powers of the Government, by implication the bank 
 question came to be regarded as, in some degree, the test of political prin- 
 ciple. 
 
 When Mr. Jefferson came into povyer, upon the strong tide of a great po- 
 litical revolution, the odium of the alien and sedition laws was, in part, com- 
 municated to the Bank of the United States; and, although he gave his official 
 sanction to an act, creating a new branch of that institution, at New Orleans, 
 and to another to punish the counterfeiting of its bills, yet, when the question 
 
 member of the Senate, were decidedly in favor of the renewal, sustaining the 
 measure by able arguments, the votes in both branches of Congress were dis- 
 tinctly marked as party votes. At no time, since the commencement of the 
 Government, has there existed a more violent party excitement, than that 
 which marked the period under review. It was the period of the embargo, 
 non-intercourse, and other commercial restrictions; when the undiscriminat- 
 ing opposition of the leaders of the federal party to the measures adopted by 
 the administration, to vindicate our rights against British aggression, had 
 caused the great majority of the American People to view these Leaders as the 
 apologists pt a nation, already regarded in the light of a public enemy. When, 
 to these circumstances, we add, that the stock of the bank was principally 
 held by British subjects, and Americans of the. unpopular parly, the House 
 will readily perceive how great were the national and party prejudices which 
 must have been arrayed against the proposition to renew its charter. It was 
 stated bv Mr. Clay, in a speech delivered in the Seriate, that seven -tenths of 
 the stock belonged to British subjects, and that certain English noblemen, and 
 a late lord chancellor, were among the very largest of the stockholders. With 
 all these difficulties to encounter, the proposition for renewing the charter was 
 lost only by the casting vote of the President of the Senate, and by a majority 
 of a single vote in the House of Representatives. 
 
 In less than three years after the expiration of the charter the war with 
 Great Britain having taken place in the mean time the circulating medium 
 became so disordered, the public finances so deianged, arid the public credit 
 so impaired, that the enlightened patriot, Mr. Dallas, who then presided over 
 the Treasury Department, with the sanction of Mr. Madison, and, as it is be- 
 lieved, every member of the cabinet, recommended to Congress the establish- 
 ment of a national bank, as the only measure by which the public credit could 
 be revived, and the fiscal resources of the Government redeemed from a 
 ruinous, and otherwise incurable embarrassment: and, such had been the im- 
 
 pressive lesson taught by a very brief, but fatal experience, that the very in- 
 stitution, which had been so recently denounced, and rejected by the repub- 
 lican party, being now recommended by a republican administration, was 
 carried through both branches of Congress, as a republican measure, by an 
 overwhelming majority of the republican party. It is true that Mr. Madison 
 ditl not approve and sign the bill which passed the two Houses, because it was 
 
REPORT OF COMMITTEE, 1830. 737 
 
 Hot such a bill as had been recommended by the Secretary of the Treasury, 
 and because the bank it proposed to create was not calculated, in the opinion 
 ofthe President, to relieve the necessities of the country. Hut he premised 
 his objections to the measure, by k4 waiving the question of the constitutional 
 authority of the Legislature to establish an incorporated bank, as being pre- 
 cluded, in his opinion, by repeated recognitions, under varied circumstances, 
 ofthe validity of such an institution, in acts ofthe Legislative, Executive, and 
 Judicial branches of the Government, accompanied by indications, in differ- 
 ent modes, of a concurrence of the general will of the nation." Another 
 bill was immediately introduced, and would, in all probability, have become 
 a law, had not the news of peace, by doing away the pressure of the emer- 
 gency, induced Congress to suspend 'further proceedings on the subject until 
 the ensuing session. At the commencement of that session. Mr. Madison 
 invited the attention of Congress to the subject, and Mr. Dallas again urged 
 the necessity of establishing a bank, to restore the currency, and facilitate the 
 collection and disbursement of (he public revenue; and so deep and solemn 
 was the conviction, upon the minds of the public functionaries, that such'an 
 institution was t'ne only practicable means ot restoring the circulating medium 
 to a state of soundness, that, notwithstanding the decided opposition of all the 
 State banks and their debtors, and, indeed, the whole debtor class of the 
 community, the act incorporating the present Bank of the United States 
 was passed by considerable majorities in both branches of Congress, and ap- 
 proved by Mr. Madison. 
 
 This brief history of the former and present bank forcibly suggests a few 
 practical reflections. It is to be remarked, in the first place, that, since tin- 
 adoption of the constitution, a bank has existed, under the authority of tin- 
 Federal Government, for thirty three out of forty years; during which time, 
 public and private credit have been maintained at an elevation fully equal to 
 what has existed in any nation in the. world: whereas, in the two short inter- 
 vals, during which no national bank existed, public and private credit were 
 greatly impaired, and, in the latter instance, the fiscal operations of the Go- 
 vernment were almost entirely arrested. In the second place, it is worthy of 
 special notice, that, in both the instances in which Congress has created a 
 bank, it has been done under circumstances calculated to give the highest 
 authority to the decision. The first instance, as has been already remarked, 
 was in the primitive days ofthe republic, when the patriots ofthe Revolution, 
 and the sages ofthe Federal Convention, were the leading members both of 
 the Executive and Legislative councils; and when General Washington, who, 
 at the head of her armies, had conducted his country to independence, and, 
 as the head of the convention, had presided over those deliberations which re- 
 sulted in the establishment ofthe present constitution, was the acknowledged 
 President of a People, undistracted by party divisions. The second instance 
 was under circumstances of a very different but equally decisive character. 
 We find the very party, which had so recently defeated the proposition to 
 renew the charter of the old bank, severely schooled both by adversity and 
 experience, magnanimously sacrificing the pride of consistency, and the pre- 
 judices of party, at the shrine of patriotism. It may be said, without dispa- 
 raement ? that an assembly of higher talent and purer patriotism has never 
 existed, smce^the days of the Re volution, than the Congress by which the pre- 
 sent bank was incorporated. If ever a political party existed, of which it 
 might be truly said, that " all the ends they aimed at were their country's," 
 it was the republican party of that day. They had just conducted the country 
 through the perils of a war, waged in defence of her rights and honor, and, 
 elevating their views far above the narrow and miserable ends of party strife, 
 sought only to advance the permanent happiness of the People. It was to 
 this great end, that they established the present bank. 
 
 In this review, it will be no less instructive than curious, to notice some of 
 
 the changes made in the opinions of prominent men, yielding to the authority 
 
 of experience. Mr. Madison, who \vas the leading opponent of the bank 
 
 created in 171)1, recommended and sanctioned the bank created in 1816; and 
 
 93 
 
738 RANK OF THE UNITED STATES. 
 
 Mr. (May, who strenuously opposed the renewal of the charter in 1811, a* 
 strenuously supported the proposition to grant the charter in 1810. 
 
 That may be said of the bank charter, winch can be said of few contested 
 questions of constitutional power. Both the great political parties that have 
 so long divided the country, have solemnly pronounced it to be constitutional, 
 and there are but very few of the prominent men of either party, who do not 
 stand committed in its favor. When, to this imposing array of authorities, 
 the committee add the solemn and unanimous decision of the Supreme Court, 
 in a case which fully and distinctly submitted the constitutional question to 
 their cognizance, may they not ask, in the language of Mr. Dallas, " can it 
 be deemed a violation of the right of private opinion to consider the constitu- 
 tionality of a national bank as a question forever settled and at rest?" 
 
 And here the committee beg to be distinctly understood, as utterly dis 
 claiming the idea of ascribing to the decision of any or of all the departments 
 of the Government, upon a great constitutional question, the binding authority 
 which belongs to judicial precedents, in cases of mere private right, depend- 
 ing upon the construction of the ordinary acts of the Legislature. No length 
 of prescription, or concurrence of authority, can consecrate the usurpation of 
 powers subversive of public liberty, and destructive of public happiness. But, 
 where the povyer exercised is clearly conducive to the public welfare, and its 
 constitutionality is merely doubtful, it would seem to be one of the most ob- 
 vious dictates of practical wisdom, to regard the decision of those who had 
 the best means of ascertaining the intention of the constitution, and who were 
 actuated by the most undoubted purity and disinterestedness of motive, as of 
 sufficient authority, at least, to overrule theoretical objections and silence 
 individual scruples. 
 
 The committee will now submit a few remarks, with the design of showing, 
 that, vievying the constitutionality of the bank as an original question, the ar- 
 guments in fts favor are, at least, as strong as those against it. 
 
 The earliest, and the principal objection urged against the constitutionality 
 of a national bank, was, that Congress had not the power to create corpora- 
 tions. That Congress has a distinct and substantive power to create corpo- 
 rations, without reference to the objects entrusted to its jurisdiction, is a 
 proposition which never has been maintained, within the knowledge of the 
 committee; but, that any one of the powers, expressly conferred upon Con- 
 gress, is subject to the limitation that it shall not be carried into effect by the 
 agency of a corporation, is a proposition which cannot be maintained, in the 
 opinion of the committee. 
 
 If Congress, under the authority to pass all laws necessary and proper for 
 carrying into effect the powers vested in all or any of the departments of the 
 Government, may rightfully pass a law inflicting the punishment of death. 
 without any other authority, it is difficult to conceive why it may not pass a 
 law, under the same authority, for the more humble purpose of creating a cor- 
 poration. The power of creating a corporation is one ot the lowest attributes, 
 or, more properly speaking, incidents, of sovereign power. The chartering 
 of a bank, for example, does not authorize the corporation to do any thing 
 which the individuals composing it might not do without the charter- It is 
 the right of every individual of the Union to give credit to whom he chooses, 
 and to obtain credit where he can get it. It is not the policy of any commer 
 cial country to restrict the free circulation of credit, whether in the form of 
 promissory notes, bills of exchange, or bank notes. The charter of the 
 Bank of the United States, therefore, merely enables the corporation to do, 
 in an artificial capacity, and with more convenience, what it would be lawful 
 for the individual corporators to do without incorporation. Mr. Girard es- 
 tablished a bank in Philadelphia, without a charter, which was in very high 
 credit within the sphere of its circulation; and it cannot be doubted that he 
 might have formed a banking co-partnership with the principal capitalists in 
 the other commercial cities of the Union, of which the bills would nave had a 
 general credit in every part of the country, particularly if the Federal Govern- 
 ment had provided that these bills should be received in discharge of its dues. 
 
RKPORT OF COMMITTEE, 1830. 759 
 
 The only material particular in which the charter of the Bank of the United 
 States confers a privilege upon the corporation, apparently inconsistent with 
 the State laws, is, the exemption of the individual property of the corporators 
 from responsibility for the debts of the corporation. But, if the community 
 deal with the bank, knowing that the capital subscribed is alone liable for its 
 debts, no one can complain either of imposition or injury; and, in point of 
 fact, no one ever has complained on that score, or ever will. The real com- 
 plaint against the bank, is not that it has not a sufficient basis for its credit, 
 but that its credit is too extensive. The objection lies, therefore, not against 
 the artificial character communicated to the stockholders by the charter, but 
 against the pecuniary operations of the bank itself. Now, these operations 
 consist in the use ot its own capital a faculty not surely derived from the 
 Government, but, in the exercise of which, the Government imposes many 
 useful restrictions for the benefit of itself and of the community. 
 
 The committee have presented this brief analysis of a bank corporation, 
 with the view of showing that there is nothing, m the nature of me thing, 
 which renders it unfit to be an instrument in the hands of a Government, ad- 
 mitted to be sovereign in its appropriate sphere, for carrying into effect powers 
 expressly delegated. 
 
 It now remains for the committee to show that the Bank of the United 
 States is a * fc necessary and proper," or, in other words, a natural and appro- 
 priate means of executing the powers vested in the Federal Government. In 
 the discussion of 1791, and also in that before the Supreme Court, the powers 
 of raising, collecting, and disbursing the public revenue, of borrowing money 
 on the credit of the United States, and paying the public, debt, were those 
 which were supposed mosr. dearly to carry with them the incidental right of 
 incorporating a bank, to facilitate the^e operations. There can be no doubt 
 that these fiscal operations are greatly facilitated by a bank, and, it is confi- 
 dently believed, that no person has presided twelve months over the treasury, 
 from its first organization to the present time, without coming to the conclu- 
 sion that such an institution is exceedingly useful to the public finances in 
 time of peace, but indispensable in time of war. But, as this view of the 
 question has been fully unfolded in former discussions, familiar to the House, 
 the committee will proceed to examine the relation which the Bank of the 
 United States bears to another of the powers of the Federal Government, but 
 slightly adverted to in former discussions of the subject. 
 
 The power to " coin money and fix the value thereof," is expressly and 
 exclusively vested in Congress. This grant was evidently intended to invest 
 Congress with the power of regulating the circulating medium. * 4 Coin" was 
 regarded, at the period of training the constitution, as synonymous with 
 '* currency;" as it was then generally believed that bank notes could only be 
 maintained in circulation by being the true representative of the precious me- 
 tals. The word "coin," therefore, must be regarded as a particular term, 
 standing as the representative of a general idea. No principle of sound con- 
 struction will justify a rigid adherence to the letter, in opposition to the plain 
 intention of the clause. If. for example, the gold bars ot Ricardo should be 
 substituted for our present coins, by the general consent of the commercial 
 world, could it be maintained thai Congress would not have the power to 
 make such money, and fix its value, because it is not " coined?" This would 
 be sacrificing sense to sound, and substance to mere form. This clause of the 
 constitution is analogous to that which gives Congress the power 4k to establish 
 post roads." Giving to the word " establish" its restricted interpretation, as 
 being equivalent to *' fix," or " prescribe," can it be doubted that Congress 
 has the power to establish a canal or a river, as a post route, as well as a 
 road? Roads were the ordinary channels of conveyance, and the term was, 
 therefore, used as synonymous with " routes," vyhatever might be the chan- 
 nel of transportation; and, in like, manner, fc< coin," being the ordinary and 
 most known form of a circulating medium, that term was used as synonymous 
 with currency. 
 
740 BANK OF THK UNITED STATES. 
 
 An argument in I'avor of the view just taken, may be fairly deduced from 
 the fact, that the States are expressly prohibited from " coining money, or 
 emitting bills of credit," and from " making any thing but gold and silver a 
 lawful tender in payment of debts." This strongly confirms the idea, that 
 the subject of regulating the circulating medium, whether consisting of coin 
 or paper, was, at the same time that it was taken from the control of the 
 States, vested in the only depository in which it could be placed, consistently 
 with the obvious design of having a common measure of value throughout the 
 Tn ion. 
 
 But, even if it should be conceded, that the grant of power to " coin money 
 and fix the value thereof," does not, in its terms, give Congress the power of 
 regulating any other than the " coined" currency of the Union, may not the 
 power of regulating any substituted currency, and especially one which is the 
 professed representative of coin, be fairly claimed as an incidental power 
 as an essential means of carrying into effect the plain intention of the constitu- 
 tion, in clothing Congress with the principal power? This power was granted 
 in the same clause with that to regulate weights arid measures, and for similar 
 reasons. The one was designed to ensure a uniform measure of value, as the 
 other was designed to ensure a uniform measure of quantity. The former is 
 decidedly the more important, and belongs essentially to the General Govern- 
 ment, according to every just conception of our system. A currency of uni- 
 form value is essential to what every one will admit to be of cardinal import- 
 ance the equal action of our revenue system upon the different parts of the 
 Union. The state of things which existed when the bank was incorporated, 
 furnished a most pregnant commentary on this clause of the constitution. 
 The currency of the country consisted of the paper of local banks, variously 
 depreciated. At one of the principal sea ports the local currency was twenty 
 per cent, below par. Now it was in vain for Congress to regulate the value of 
 coin, when the actual currency, professing to be its equivalent, bore no fixed 
 relation to it. This great and essential power of fixing the standard of value, 
 was, in point of fact, taken from Congress, and exercised by some hundreds 
 of irresponsible banking corporations, with the strongest human motives to 
 abuse it, because their enormous profits resulted from the abuse. The power 
 of laying and collecting imposts and excises is expressly subject to the con- 
 dition, that they " shall be uniform throughout the United States;" and it is 
 also provided, that " no preference shall be given, by any regulation of com- 
 merce or revenue, to the ports of one State over those of another." Now, 
 when it is known that the circulating medium of Baltimore was twenty per 
 cent, below the value of the circulating medium of Boston, is it not apparent 
 that an impost duty,though nominally uniform, would, in effect, make a discri- 
 mination in favor of Baltimore, proportioned to the depreciation of the local 
 currency? Congress, therefore, not only had the power, but, as it seems to 
 the committee, were under the most solemn constitutional obligations to re- 
 store the disordered currency; and the Bank of the United States was not only 
 an appropriate means for the accomplishment of that end, but, in the opinion 
 of the committee, the only safe and effectual means that could have been used. 
 This view of the subject is in full accordance with the opinion of Mr. Madi- 
 son, as expressed in his message of December, 1816: " But," says he, " for 
 the interest of the community at large, as well as for the purposes of the trea- 
 sury, it is essential that the nation should possess a currency of equal value, 
 credit, and use, wherever it may circulate. The constitution has entrusted 
 Congress, exclusively, with the power of creating and regulating a currency 
 of that description, and the measures which were taken, during ^the last ses- 
 sion, in execution of the power, give every promise of success. The Bank of 
 the United States, under auspices the most favorable, cannot fail to be an im- 
 portant auxiliary." 
 
 Such are the authorities, and such the arguments, which have brought the 
 committee to the conclusion, that the power to incorporate a bank is inciden- 
 tal to the powers of collecting and disbursing the public revenue; of borrow- 
 ing money on the credit of the United Statesj of paying the public debt; and. 
 
REPORT OF COMMITTEE, 1830. 741 
 
 above all, of fixing and regulating the standard of value, and thereby ensuring, 
 at least so far as the medium of payment is concerned, the uniformity and 
 
 Tality of taxation. 
 . The next question proposed for consideration, is the expediency of es- 
 tablishing an incorporated bank, with a view to promote the great ends al- 
 ready indicated- In discussing the constitutionality of such a measure, some 
 of the considerations which render it expedient have been slightly unfolded. 
 But these require a more full and complete development, while others remain 
 to be presented. 
 
 It must be assumed as the basis of all sound reasoning on this subject, that 
 the existence of a paper currency, issued by banks deriving their charters from 
 I he State Governments, cannot be prohibited by Congress. Indeed, bank 
 credit and bank paper are so extensively interwoven with the commercial 
 operations of society, that, even if Congress had the constitutional power, it 
 would be utterly impossible to produce so entire a change in the monetary 
 system of the country, as to abolish the agency of banks of discount, without 
 involving the community in ah the distressing embarrassments usually attend- 
 ant on great political revolutions, subverting the titles to private property. 
 The sudden withdrawal of some hundred millions of bank credit, would be 
 equivalent, in its effects, to the arbitrary and despotic transfer of .the property 
 of one portion of the community to another, to the extent, probably, ot half 
 that amount. Whatever, therefore, may be the advantages of a purely me- 
 tallic currency, and whatever the objections to a circulating medium, partly 
 composed of bank paper, the committee consider that they are precluded, by 
 the existing state of things, from instituting a comparison between them, with 
 a view to any practical result. 
 
 If they were not thus precluded, and it were submitted to thrin as an ori- 
 ginal question, whether the acknowledged and manifold facilities of bank credit 
 and bank paper are not more than counterbalanced by the distressing vicissi- 
 tudes in trade incident to their use, they are by no means prepared to say, 
 that they would not give a decided preference to the more costly and cumber-- 
 some me. Hum. 
 
 But the question really presented for their determination, is not between a 
 metallic and a paper currency, but between a paper currency of uniform value, 
 and subject to the control of the only power competent to its regulation, 
 and a paper currency of varying and fluctuating value, and subject to no 
 common or adequate control whatever. On this question, it would seem 
 that there could scarcely exist a difference of opinion; and that this is sub- 
 stantially the question involved in considering the expediency of a national 
 bank, will satisfactorily appear by a comparison of the state of the currency 
 previous to the establishment of the present bank, and its condition for the 
 last ten years. 
 
 Soon after the expiration of the charter of the first Bank of the United States, 
 an immense number of local banks sprung up under the pecuniary exigencies 
 produced by the withdrawal of so large an amount of bank credit, as neces- 
 sarily resulted from the winding up of its concerns an amount falling very 
 little short of fifteen millions of dollars. These banks being entirely free from 
 the salutary control which the Bank of the United States jiad recently exer- 
 cised over the local institutions, commenced that system of imprudent trading 
 and excessive issues, which speedily involved the country in all the embar- 
 rassments of a disordered currency. The extraordinary stimulus of a heavy 
 war expenditure, derived principally from loans, and a corresponding multi- 
 plication of local banks, chartered by the double score in some of the States, 
 hastened the catastrophe which must have occurred, at no distant period, 
 vyithout these extraordinary causes. The last year of the war presented the 
 singular and melancholy spectacle of a nation abounding in resources, a peo- 
 ple abounding in self-devoting patriotism, and a Government reduced to the 
 very brink of avowed bankruptcy, solely for the want of a national institu- 
 tion, which, at the same time that it would have facilitated the Government 
 loans and other treasury operations, would have furnished a circulating me 
 
742 BANK OF THE UNITED STATES. 
 
 ilium of general credit in every part of the Union. In this view of the subject, 
 the committee are fully sustained by the opinion of Mr. Dallas, then vSecretarv 
 of the Treasury, and by the concurring; and almost unanimous opinion of all 
 parties in Congress: for, whatever diversity of opinion prevailed, as to the 
 proper basis and organization of a bank, almost every one agreed that a na- 
 tional bank, of some sort, was indispensably necessary to rescue the country 
 from the greatest of financial calamities. 
 
 The committee will now present a brief exposition of the state of currency at 
 the close of the war; of the injury which resulted from it, as well to the Go- 
 vernment as to the. community; and their reasons lor believing that it could 
 not have been restored to a sound condition, and cannot now be preserved in 
 that condition, without the agency of such an institution as (he Bank of the 
 United States. 
 
 The price, current appended to this report \yill exhibit a scale of deprecia- 
 tion in the local currency, ranging, through various degrees, to twenty, and 
 even to twenty-five per cent. Among the. principal Eastern cities, Washing- 
 ton and Baltimore were the points at which the depreciation was greatest. 
 The paper of the banks in these places was from twenty to t\yenly-t\vo per 
 cent, below par. At Philadelphia the depreciation was considerably less, 
 though, even there, it was from seventeen to eighteen per cent. In New 
 York and Charleston, it was from seven to ten per cent. But, in the interi- 
 or of the country, where banks were established, the depreciation was even 
 greater than at Washington and Baltimore. In the western part of Pennsyl- 
 vania, and particularly at Pittsburgh, it was twenty-live per cent. These 
 statements, however, of the relative depreciation of bank paper at various pla- 
 ces, as compared with specie, give a very inadequate idea of the enormous 
 evil inflicted upon the community by the excessive issues of bank paper. 
 No proposition is better established than that the value of money, whether it 
 consists of specie or paper, is depreciated in exact proportion to the increase 
 of its quantity, in any given state of the demand for it. If, for example, the 
 banks, in 1816, doubled the quantity of the circulating medium by their ex- 
 cessive issues, they produced a general depredation of the entire mass of the 
 currency, including gold and silver, proportioned to the redundancy of the is- 
 sues, and wholly independent of the relative depreciation of bank paper at dif- 
 ferent places, as compared with specie. The nominal money price of every 
 article was, of*course, one hundred per cent, higher than it would have been, 
 but for the du plication of the quantity of the circulating medium. Money is 
 nothing more nor less than the measure by which the relative value of all arti- 
 cles of merchandise is ascertained. If, when the circulating medium is fifty 
 millions, an article should cost one dollar, it would certainly cost two, if, 
 without any increase of the uses of a circulating medium, its quantity should 
 be increased to one hundred millions. This rise in the price of commodities, 
 or depreciation in the value of money, as compared with them, would not be 
 owing to the want of credit in the bank bills, of which the currency happened 
 to be composed. It would exist, though these bills were of undoubted credit, 
 and convertible into specie at the pleasure of the holder, and would result. 
 simply from the redundancy of their quantity. It is important to a just un- 
 derstanding of the subject, that the relative depreciation of bank paper at dif- 
 ferent places, as compared with specie, should not be confounded with this 
 general depreciation of the entire mass of the circulating medium, including 
 specie. Though closely allied, both in their causes and effects, they deserve 
 to be separately considered. 
 
 The evils resulting from the relative depreciation of bank paper at different 
 places, are more easily traced to their causes, more palpable in their nature, 
 and, consequently, more generally understood by the community. Though 
 much less ruinous than the evils resulting from the general depreciation of 
 the whole currency, they are yet of sufficient magnitude to demand a full ex- 
 position. 
 
 A very serious evil, already hinted at, which grew out of the relative de- 
 preciation of bank paper, at the different points of importation, was its inevi- 
 
REPORT OF COMMITTEE, 1830 743 
 
 fable tendency to draw all the importations of foreign merchandise to the ci- 
 ties where the depreciation was greatest, and divert them from those where, 
 the. currency was comparatively sound. If the Bank of the United States 
 had not been established, and trie Government had been left without any al- 
 ternative but to receive the depreciated local currency, it is difficult to ima- 
 gine the extent to which the evasion of the revenue laws would have been car- 
 ried. Every State would have had an interest to encourage the excessive is- 
 sues of its banks, and increase the degradation of its currency, with a view to 
 attract foreign commerce. Even in the condition which the currency had 
 reached in 1816, Boston, and New York, and Charleston, would have found 
 it advantageous to derive the supplies of foreign merchandise through Balti- 
 more; and commerce would, undoubtedly, have taken that direction, had not 
 the currency been corrected. To avoid this injurious diversion of foreign 
 imports, Massachusetts, and New York, and South Carolina, would have 
 been driven, by all motives of self defence and self interest, to degrade their 
 respective currencies at least to a par with the currency of Baltimore; :ind 
 thus a rivalry in the career of depreciation would have sprung up, to which no 
 limit can be assigned. As the tendency of this state of things would have been 
 to cause the largest portion of the revenue to be collected at a few places, ami 
 in the most depreciated of the local currency, it would have follo\yed that a 
 very small part of that revenue would have been disbursed at the points where 
 it was collected. The Government would, consequently, have been compel- 
 led to sustain a heavy loss unon the transfer of its funds to the points of expen- 
 diture. The annual loss which would have resulted from these causes alone, 
 cannot be estimated at a less sum than two millions of dollars. 
 
 But the principal loss which resulted from the relative depreciation of bank 
 paper at different places, and its want of general credit, was that sustained 
 by the community in the great operations of commercial exchange- 'The ex- 
 tent of these operations annually, may be safely estimated at sixty millions of 
 dollars. Upon this sum, the los\ sustained by the merchants, and planters, 
 and Farmers, and manufacturers, was not probably less than an average of ton 
 per cent., being the excess of the rate of exchange between its natural rate in 
 a sound state of the currency, and beyond the rate to which it has been actu- 
 ally reduced by the operations of the Bank of the United States. It will be 
 thus perceived, that an annual tax of six millions of dollars was levied from 
 the industrious and productive classes, by the large moneyed capitalists in 
 our commercial cities, who were engaged in the business of brokerage. A va- 
 riously depreciated currency, and a fluctuating state of the exchanges, open 
 a wide and abundant harvest to the money brokers: and it is not, therefore, 
 surprising, that they should be opposed to an institution, which, at the same 
 time that it has relieved the community from the enormous tax just stated, has 
 deprived them of the enormous profits which they derived from speculating in 
 the business of exchange. In addition to the losses sustained by the commu- 
 nity, in the great operations of exchange, extensive losses were suffered 
 throughout the interior of the country in all the smaller operations of trade, 
 as well as by the failure of the numerous paper banks, puffed into a factitious 
 credit by fraudulent artifices, and having no substantial basis of capital to en- 
 sure the redemption of their bills, 
 
 But no adequate conception can be formed of the evils of a depreciated cur- 
 rency, without looking beyond the relative depreciation, at different places, 
 to the general depreciation of the entire mass. It appears from the report of 
 Mr. Crawford, the Secretary of the Treasury, in 1820, that, during the gen- 
 eral suspension of specie payments, by the local banks, in the years 1815 and 
 1816, the circulating medium of the United States had reached the aggregate 
 amount of one hundred and ten millions of dollars, and that, in the year 1819, 
 it had been reduced to forty-five millions of dollars, being a reduction of fifty- 
 nine per cent, in the short period of four years. The committee are inclined 
 to the opinion, that the severe and distressing operation of restoring a vicious 
 currency to a sound state, by the calling in of bank paper, and the curtail- 
 ment of bank discounts, had carried the reduction of the currency, in 1819, 
 
744 BANK OF THE UNITED STATES. 
 
 to a point somewhat lower than was consistent with the just requirements of 
 the community for a circulating medium, and that the bank discounts have 
 been gradually enlarged since that time, so as to satisfy those requirements. 
 It will be assumed, therefore, that the circulating medium of the United States 
 has been fifty-five millions of dollars for the last ten years, taking the average. 
 
 Even upon this assumption it will follow, that the national currency has 
 been one hundred per cent, more valuable for the last ten years, than it was 
 in 1816. In other words, two dollars would purchase no more of any com- 
 modity, in 1816, than one) dollar has been capable of purchasing at anyftime 
 since 1819. It is obvious, therefore, that the depreciation of the paper of par- 
 ticular banks, at any particular time, as compared with specie, furnishes no 
 criterion by which to ascertain the general depreciation of the whole currency, 
 including specie, as compared with the value of that currency at a different 
 period. A specie dollar, in 1816, would purchase no more than half as much 
 as a paper dollar will purchase at present. 
 
 Having endeavored to explain, thus briefly, the general depreciation result- 
 ing from a redundant currency, the committee will now proceed to point out 
 some of the injurious consequences which have resulted from those great 
 changes in the standard of value, which have been unavoidably produced by 
 the correction of the redundancy. 
 
 An individual who borrowed a sum of money in 1816, and paid it in 1820, 
 evidently returned to the lender double the value received from him; and one 
 who paid a debt in 1820, which he had contracted in 1816, as evidently paid clou - 
 ble the value he had stipulated to pay, though nominally the same amount in 
 money. It is in this way that fluctuations in the quantity and value of the 
 currency interfere, in the most unjust and injurious manner, between debtor 
 and creditor. 
 
 And when banks have the power of suspending specie payments, and of ar- 
 bitrarily contracting and expanding their issues, without any general con- 
 trol, they exercise a more dangerous and despotic power over the property 
 of the community, than was ever exercised by the most absolute Government. 
 In such a state of things, every man in the community holds his property at 
 the mercy of money making corporations, which have a decided interest to 
 abuse their power. 
 
 By a course of liberal discounts and excessive issues for a lew years, fol- 
 lowed by a, sudden calling in of their debts and contraction of their issues, 
 they would have the power of transferring the property of their debtors to 
 themselves, almost without limit. Debts contracted when their discounts 
 were liberal, and the currency, of course, depreciated, would be collected 
 when their discounts were almost suspended, and the currency, of course, 
 unnaturally appreciated ; and in this way the property of the community might 
 pass, under the hammer, from its rightful owners to the banks, for less than 
 one- half its intrinsic value. If the committee have not greatly mistaken the 
 matter, there is more of history than of speculation in what they have here 
 presented to the consideration of the House. 
 
 It is impossible to form any thing like an accurate estimate of the injuries 
 and losses sustained by the community, in various ways, by the disorders and 
 fluctuations of the currency, in the period which intervened between the ex- 
 piration of the old bank charter, and the establishment of the present bank. 
 But some tolerable notion may be formed of the losses sustained by the Go- 
 vernment, in its fiscal operations, during the war. 
 
 The committee have given this part of the subject an attentive and careful 
 examination, and they cannot estimate the pecuniary losses of the Govern- 
 ment, sustained exclusively for the want of a sound currency, and an effi- 
 cient system of finance, at a sum less than forty-six millions of dollars. If they 
 shall make this apparent, the House will have something like a standard for 
 estimating the individual losses of the community. 
 
 The Government borrowed, during the short period of the war, eightv mil- 
 lions of dollars, at an average discount of fifteen per cent, giving certificates 
 of stock, amounting to eighty millions of dollars, in exchange for sixty -eight 
 
REPORT OF COMMITTF.F., 1*30. 745 
 
 millions of dollars in Mich bank paper as could be obtained. In this state- 
 ment treasury notes are considered as stock, at twenty per rent, discount. 
 Upon the very (ace of the transaction, therefore, there was a loss of twelve 
 millions of dollars, which would, in all probability, have been saved, if the 
 treasury had been aided by such an institution as the Bank of the United 
 State?. But the sum of sixty-eight millions of dollars, received by the Go- 
 vernment, was in a depreciated currency, not more than half as valuable as 
 that in which the stock given in exchange for it, has been and will be redeem- 
 ed. Here, the.i, is another loss of thirty-four millions, resulting, incontesti- 
 bly and exclusively, from the depreciation of the currency, and making, with 
 the sum lost by the discount, forty six millions of dollars. While, then, the 
 Government sustained this great pecuniary loss in less than three years of 
 war, amounting, annually, to more than the current expenses of the Govern 
 ment in time of peace, it is worth while to inquire who were the persons 
 who profited to this enormous amount by the derangement of the currency? 
 Tt will be found that the whole benefit of this speculation upon the necessities 
 of the Government was realised by stockjobbers and money brokers, the very 
 same class of persons who profited so largely by the business of commercial 
 exchanges, in consequence of the disorders of the currency, and who have the 
 same interest in the recurrence of those disorders as lawyers have in litiga- 
 tion, or physicians in the diseases of the human frame. Having presented 
 these general views of the evils which existed previous to the establishment of 
 the Bank of the United States, it remains for the committee to inquire how 
 far this institution has effected a remedy of those evils. 
 
 The first great question which arises under this branch of the inquiry is, 
 whether or no the bank has corrected the disorders of the circulating medium, 
 by providing a paper currency, convertible into specie at the pleasure of the 
 holder, and of equal value with specie at all points of the Union? 
 
 The ('hief Magistrate, in that part of his first message which relates to the 
 Bank of the United States, expresses the opinion that "it has failed in the 
 great end of establishing a uniform and sound currency." After giving to this 
 opinion all the consideration to which it is so justly entitled, from the eminent 
 station and high character of the citi/.en by whom it is entertained, the com- 
 mittee aVe constrained to express their respectful but decided dissent from il. 
 it is true that the bank does not, in all cases, redeem the bills, issued by any 
 one of its branches, indiscriminately at all the other branches; and it is in re- 
 ference to this fact, as the committee presume, that the President expresses 
 the opinion that the institution has fatted to establish " a uniform and sound 
 currency."' 
 
 It is confidently believed, that no one of the persons who were principally 
 instrumental in establishing the bank, ever entertained an idea that it would 
 attempt to redeem its bills at any of its offices, other than those by which they 
 should be respectively issued. The charter certainly contains no such re- 
 quirement, and it would have been highly inexpedient if it had, to say nothing 
 of its obvious injustice. The inevitable effect of such a requirement would 
 have been to compel the bank to perform the whole of the commercial ex- 
 changes of the countrv, without any compensation. It would not be more 
 unjust to require a mil road company to transport all the productions of the 
 country without compensation. No institution could stand such an operation; 
 and it was the injudicious attempt of the first direction of the bank to do it, that 
 principally contributed to the embarrassments of 1819. A committee was ap- 
 pointed by the House of Representatives, in that year, to investigate the man- 
 agement of the bank; and in the report of that committee, as well as in the 
 discussions to which it gave rise in the House, this attempt of the direction to 
 redeem the bills of the institution, indiscriminately, at all its branches, was 
 indicated as one of the causes of the existing embarrassment. No one who 
 participated in the debate pretended to allege that the bank was bound to re 
 deem its bills indiscriminately, or that it was expedient that it should do so. 
 The most that any one did, was to apologise for the unwise attempt. 
 94 
 
746 BANK OF THE UNITED STATES. 
 
 But it yet remains for the committee to show that this indiscriminate re- 
 deemability of the bills of all the branches of the bank is not necessary to 
 " the establishment of a uniform and sound currency." 
 
 Human wisdom has never effected, in any other country, a nearer approach 
 to uniformity of the currency, than that which is made by the use of the pre- 
 cious metals. If, therefore, it can be shown that the bills of the United States' 
 Bank are of equal value with silver at all points of the Union, it would seem 
 that the proposition is clearly made out, that the bank has accomplished " the 
 great end of establishing a uniform and sound currency." It is not denied 
 that the bills of the mother bank, and of all its branches, are invariably and 
 promptly redemed in specie, whenever presented at the offices by which they 
 have been respectively issued, and at which, upon their face, they purport to 
 be payable. Nor is it denied that the bills of the bank, and of all the branches, 
 are equal tu specie in their respective spheres of circulation. Bills, for ex- 
 ample, issued by the mother bank, arc admitted to be equal to silver in Penn- 
 sylvania, and all those parts of the adjacent States of which Philadelphia is 
 the market. But it is contended that these bills, not bein^ redeemable at 
 Charleston and New Orleans, are not of equal value with silver to the mer- 
 chant who wishes to purchase cotton with them, in those cities. Now, if the 
 Philadelphia merchant had silver, instead of bank bills, he certainly could not 
 effect his purchases with it in Charleston or New Orleans, without having the 
 silver conveyed to those places; and it is equally certain that he could not 
 have it conveyed there, without paying for its transportation and insurance. 
 These expenses constitute the natural rate of exchange between those cities, 
 and indicate the exact sum which the merchant would give as a premium for 
 a bill of exchange, to avoid the trouble and delay of transporting his specie. 
 It is obvious, therefore, that, even for these distant operations of commerce, 
 silver would be no more valuable than the bills of the bank: for these would 
 purchase a bill of exchange on either of the cities mentioned, precisely as well 
 as silver. If the operation should be reversed, and the planter of Louisiana 
 or South Carolina should desire to place his funds in Philadelphia with a view 
 to purchase merchandise, he would find the bills of the branch bank, in either 
 of those States, entirely equivalent to silver in effecting his object. Even, 
 therefore, if the bank had not reduced the rate of the exchanges, it might be 
 safely asserted that its bills would be of equal value with silver at every point 
 in the Union, and for every purpose, whether local or general. 
 
 But it is impossible to exhibit any thing like a just view of the beneficial ope- 
 rations of the bank, without adverting to the great reduction it has effected, 
 and the steadiness it has superinduced, in the rate of the commercial exchang- 
 es of the country. Though this branch of the business of the bank has been 
 the subject of more complaint, perhaps, than any other, the committee have 
 no hesitation in saying, it has been productive of the most signal benefits to 
 the community, and deserves the highest commendation. It has been already 
 stated that it has saved the community from the immense losses resulting from 
 a high and fluctuating state of the exchanges. It now remains to show its 
 effect in equalizing the currency. In this respect, it has been productive of 
 results more salutary than were anticipated by the most sanguine advocates 
 of the policy of establishing the bank. // has actually furnished a circulating- 
 medium more uniform than specie. This proposition is susceptible of the 
 clearest demonstration. If me whole circulating medium were specie, a 
 planter of Louisiana, who should desire to purchase merchandise in Philadel- 
 phia, would be obliged to pay one per cent, either for a bill of exchange on 
 this latter place, or for the'.transportation and insurance of his specie. His spe- 
 cie at New Orleans, where he had no present use for it, would be worth one 
 per cent, less to him than it would be in Philadelphia, where he had a de- 
 mand for it. But, by the aid of the Bank of the United States, one-half of 
 the expense of transporting specie is now saved to him. The bank, for one- 
 half of one per cent., will give him a draft upon the mother bank at Phi- 
 ladelphia, with which he can draw either the bills of that bank, or specie, at 
 his pleasure. In like manner, the bank and its branches will give drafts 
 from any point of the Union to any other where offices exist, at a per centage 
 
REPORT OF COMMITTEE, 1830. 747 
 
 greatly less than it would cost to transport specie, and, in many instances, at 
 par. It' the merchant or planter, however, does not choose to purchase a 
 draft from the bank, but prefers transmitting the bills of the office where 
 hi resides to any distant point, for commercial purposes, although these bills 
 are not strictly redeemable at the point to which they are transmitted, yet, as 
 they are receivable in payment of all dues 10 the Government, persons will be 
 generally found willing to take them at par; and if they should not, the bank 
 will receive them frequently at par, and always at a discount much less than 
 would pay the expense of transporting specie. The fact that the bills of the 
 bank and its branches are indiscriminately receivable at the custom houses 
 and land offices, in payment of duties, and for the public lands, has an effect 
 in giving uniformity to the value of these bdls, which merits a more full and 
 distinct explanation. 
 
 For all the purposes of the revenue, it gives to the national currency that 
 perfect uniformity, that ideal perfection, to which a currency of gold and sil- 
 ver, in so extensive a country, could have no pretensions. A bill issued at 
 Missouri is of equal value with specie at Boston, in payment of duties; and 
 the same is true of all other places, however distant, where the bank issues 
 bills, and the Government collects its revenue. When it is, moreover, con- 
 sidered, that the bank performs, with the most scrupulous punctuality, the 
 stipulation to transfer the funds of the Government to any point where they 
 may be wanted, free of expense, it must be apparent that the committee are 
 correct, to the very letter, m stating that the bank has furnished, both to the 
 Government and to the People, a currency of absolutely uniform value in all 
 places, for all the purposes of paying the public contributions, and disbursing 
 the public revenue. And when it is recollected that the Government annually 
 collects and disburses more than twenty-three millions of dollars, those who 
 are at all familiar with the subject will at once perceive that bills, which are 
 of absolutely uniform value for this vast operation, must be very nearly so for 
 all the purposes of general commerce. 
 
 Upon the whole, then, it may be confidently asserted, that no country in 
 the world has a circulating medium of greater uniformity than the United 
 States, and that no country, of any thing like the same geographical extent, 
 has a currency at all comparable to that of the United States, on the score of 
 uniformity. The committee have seen the statement of an intelligent travel- 
 ler, who has visited almost every part of Europe, exhibiting the great varia- 
 tions of the currency in different parts of the same empire or kingdom. In 
 Russia, the bills of the Bank of St. Petersburg!! have a very limited circula- 
 tion. At Riga, and throughout Courland, Livonia, and all the southern parts 
 of the empire, the currency is exclusively of silver coins. In Denmark, the 
 notes of the Bank of Copenhagen are current only in Zealand, the other islands, 
 and Jutland, but will not pass at all in Sleswic and Ilolstein, which consti- 
 tute the best portion of the kingdom. Since the Congress of Vienna, Ger- 
 many is divided into thirty-nine separate States, each having a distinct cur- 
 rency, though represented in the Diet at Frankfort. Out of the territory in 
 which these several currencies are issued, they are mere articles of merchan- 
 dise; which circumstance has given rise in every town to a numerous and dis- 
 tinct class of tradesmen, called money changers. How far these separate and 
 unconnected currencies have a tendency to embarrass commerce, may be in- 
 ferred from the fact, that a traveller going from St. Petersburgh to Calais 
 will lose, upon the unavoidable changes of money, an average of six per cent. 
 In France, the bills of the bank are of such large denominations as to be 
 adapted only to the greater operations of commerce, and are principally con- 
 fined to the bankers and extensive traders in Paris. The general currency is 
 silver; and, to avoid the trouble of carrying this to distant parts of the king- 
 dom, gold pieces, or bills of exchange, which are preferable, are purchased at 
 a premium of from one and a half to four per cent. After this brief review of 
 the currencies of Europe, the committee will barely state, as a conclusive 
 vindication of our currency from the imputation of unsoundness, that there is 
 no point in the Union at which a bill of ihe United States' Bank, issued at the 
 
743 BANK OF THE UNITED STATES. 
 
 opposite extremity of the country, is at a discount of more than one-fourth of 
 one per cent. 
 
 In confirmation of the views here presented, as to the comparative uni- 
 formity of the currency furnished by the bank, and, also, as to the obligation 
 of the bank to redeem its bills, indiscriminately, at all the offices, the com- 
 mittee will present a few brief extracts from the speech of a statesman, whose 
 opinions have every title to authority on these important subjects- Mr. 
 Lowndes, in discussing the question, how far the bank had performed the 
 great duty for which it was created, used the following decided language in 
 1819, when the currency had not reached the point of uniformity it has now 
 attained by half of one per cent. 
 
 "The great object ot the Government in chartering the bank, vyas to pro- 
 vide a currency which should have that degree of stability and uniformity in 
 its value, which is required by the interests both of our commerce and re- 
 venue. A currency, equally valuable at every place and every time, cannot 
 be provided by human wisdom. The nearest approach to this object has 
 been generally supposed to be afforded by the employment of gold and silver 
 as the measures of value. The fourteenth Congress did not aim at ideal per- 
 fection; they wished to combine, with the conveniencies of bank circulation, 
 an uniformity of value equal to that which was possessed by the precious me- 
 tals; and the means which they employed to secure this uniformity were sim- 
 ple and effectual, by enjoining, under a heavy penalty, the payment of all its 
 notes in coin, upon demand. In the report, indeed, the notes of the National 
 Bank are said to be now 'on the same footing with those of local banks.' Of 
 the footing on which local banks stood, he should speak hereafter; but the 
 price current upon his table informed him, that the greatest discount on branch 
 notes of the United States was three-fourths of one per cent. This was a 
 value much more uniform than that which coin could be expected to have in 
 so extensive a country. He had been lately looking into a book on political 
 economy, which had been published here, with high, and, in respect to its 
 clearness and precision, with just commendations? the work of Mr. Tracy. 
 He inferred from one of his chapters, that'the difference of exchange between 
 Marseilles and Paris was often from two to three per cent. If, with all the 
 facilities afforded by the internal improvements in which France is so rich, 
 with a currency consisting almost exclusively of gold and silver, the variation 
 in the value of money is three times greater in her territory them on our con- 
 tinent, can it be said that, in this respect, the bank has not fulfilled the ob- 
 jects of its institution? Before its establishment, the value of bank notes, even 
 in the commercial States, had varied twenty per cent, from each other; and, 
 as none of them bore a fixed proportion to the precious metals, or to any natu- 
 ral standard, it was impossible to assign any limit to their depreciation. You 
 have required that the currency furnished by the National Bank should be 
 every where convertible into silver, and it is so. You have expected that it 
 should be as uniform as coin, and it is more so. He would not detain the 
 committee by reading a paper, which he had prepared with that intention, con- 
 taining the rate of exchange, since the establishment of the bank, with Eng- 
 gland, France, and Holland; for he found himself occupying much more of 
 their time than he had expected. But he believed that any member, who 
 should turn his attention to the subject, would remark its steadiness during 
 that period. He thought himself justified in drawing from this fact a conclu- 
 sion highly favorable to the bank." 
 
 In reference to the great depreciation of the paper of the local banks, pre- 
 vious to the establishment of that of the United States, he said: 
 
 "Did the interests or duty of the Government of the United States permit 
 that this currency should be received by it? Some dissatisfaction was express- 
 ed because the branch notes of the United States' Bank were at a discount of 
 three-fourths of one per cent. He read from a price current the state of the 
 market for bank notes, by which it appeared that notes, which were insisted 
 to be in very good credit, varied from a discount of two and a half to one of 
 seven, fifteen, twenty five, and even thirty per cent. Was our revenue to be 
 
REPORT OF COMMITTEE, 183;>. 749 
 
 received in these notes? How were they to be employed? They might be 
 expended in the district in which they were issued. But was the expendi- 
 ture of every district to be exactly limited to its revenue? What became of 
 the Union it it were so? He spoke of the thing, and not the name. Our Union 
 might dissolve in imbecility, as well as be destroyed by violence. Did not 
 union imply, that the resources of one State, its money, as well as its men, 
 might be employed for the defence of another? 
 
 " But, if the Government were willing to bear the loss of a depreciated and 
 unequal currency, it must neglect the plainest principle of the constitution in 
 doing so equality of taxation. The committee must 'well remember, that, 
 before the establishment of the National Bank, such was the unequal value of 
 currency in the different States, that the merchants paid duties, varying fif- 
 teen per cent, from each other, on the same articles.' v 
 
 On the question, whether the bank was bound to redeem, indiscriminately, 
 the bills ot all its branches, he said: 
 
 "He should not argue that the bank was not bound to pay its notes, indis- 
 criminately, at all its offices. He believed that nobody now contended that 
 it was." * * " It was no unfair account of the practical operation 
 
 of the system of which he was speaking, to say, that it gave to the brandies 
 where the exchange was unfavorable, the entire disposition of the specie ot 
 those branches where the exchange was favorable. Upwards of six millions 
 of specie have been sent to the branch of New York, besides the amount which 
 has been paid by the subscribers of the bank there: but, in issuing notes which 
 the bank of New York has been obliged to redeem, every branch throughout 
 the country has drawn upon a fund, with whose condition, at the time, it 
 could not be acquainted/' * * * * "Such a system 
 
 might be expected to produce inconvenient changes in the distribution ot bank 
 capital, an extreme facility of obtaining loans at one time, and unexpected 
 contractions of discount at another." * * * * "Whenever the state 
 of exchange is unfavorable; whenever the just principles of banking require a 
 reduction of discounts; then, under this system of indiscriminate payment of 
 its notes, the bank has nothing to fear from a draught of specie, arid is encou- 
 raged to lend to every applicant. Wherever the exchange is favorable, and 
 on the sound principles of banking, an enlarged accommodation might be given 
 to the community; there the flow of notes from every State, whose exchange 
 is unfavorable, contracts or suspends all the operations of the bank. Thus, 
 wherever discounts should be enlarged, the tendency of this system is to re- 
 duce them, and to enlarge them wherever they should be reduced." 
 
 Independently of the gross injustice of requiring the bank to perform all the 
 exchanges of this extensive confederacy, without any compensation, these en- 
 lightened views show most conclusively its inexpediency and injustice, as it. 
 regards the different sections of the Union. It would inevitably render those 
 parts of the Union, where the bank issues \vere prudent and moderate, tribu- 
 tary to those where the issues were injudicious and excessive. In this way, 
 the very inequality in the currency, which the bank was designed to correct, 
 would be perpetuated, by the vain attempt to make it perform impossibilities. 
 The power ot annihilating space, of transporting money, or any other article, 
 to the most distant points, without the loss of time, or the application of labor, 
 belongs to no human institution. 
 
 But the salutary agency of the Bank of the United States, in furnishing a 
 sound and uniform currency, is not confined to that portion of the currency 
 which consists of its own bills. One of the most important purposes which 
 the bank was designed to accomplish, and which, it is confidently believed, 
 no other human agency could have effected, under our federative system ot 
 Government, was the enforcement of specie payments on the part of nume- 
 rous local banks, deriving their charters from the several States, and whose 
 paper, irredeemable in specie, and illimitable in its quantity, constituted the 
 almost entire currency of the country. Amidst a combination of the greatest 
 difficulties, the bank has almost completely succeeded in the performance of 
 this arduous, delicate, and painful duty. With exceptions, too inconsidera- 
 
750 BANK OF THE UNITED STATES. 
 
 ble to merit notice, all the State banks in the Union have resumed specie pay- 
 ments. Their bills, in the respective spheres of their circulation, are of equal 
 value with gold and silver; while, for all the operations of commerce beyond 
 that sphere, the bills or the checks of the Bank of the United States are 
 even more valuable than specie. And even in the very few instances in which 
 the paper of State banks is depreciated, those banks are winding up then- 
 concerns; and it may be safely said, that no citizen of the Union is under the 
 necessity of taking depreciated paper, because a sound currency cannot be 
 obtained. North Carolina is believed to be the only State where paper of the 
 local banks is irredeemable in specie, and, consequently, depreciated. Even 
 there, the depreciation is only one or two per cent., and, what is more im- 
 portant, the paper of the Bank of the United States can be obtained by all 
 those who desire it, and have an equivalent to give for it. 
 
 The committee are aware that the opinion is entertained by some, that the 
 local banks would, at some time or other, either voluntarily, or by the co- 
 ercion of the State Legislatures, have resumed specie payments. In the 
 very nature of things this would seem an impossibility. It must be re- 
 membered, that no banks ever made such large dividends as were realized 
 by the local institutions, during the suspension of specie payments. A rich 
 and abundant harvest of profit was opened to them, which the resumption of 
 specie payments must inevitably blast. While permitted to give their own 
 notes, bearing no interest, and not redeemable in specie, in exchange for bet- 
 ter notes, bearing interest, it is obvious that the more paper they issued, the 
 higher would be their profits. The most powerful motive that can operate 
 upon moneyed corporations, would have existed, to prevent the State banks 
 from putting an end to the very state of things from which their excessive 
 profits proceeded. Their very nature must have been changed, therefore, 
 before they could have been induced to co operate, voluntarily, in the resto- 
 ration of me currency. It is quite as improbable that the State Legislatures 
 would have compelled the banks to do their duty. It has already been stated, 
 that the tendency of a depreciated currency to attract importations to the 
 points of greatest depreciation, and 'to lighten the relative burthens of federal 
 taxation, would naturally produce, among the States, a rivalry in the business 
 of excessive bank issues. But there remains to be stated, a cause of more 
 general operation, which would have prevented the interposition of the State 
 Legislatures to correct those issues. 
 
 The banks were, directly and indirectly, the creditors of the whole com- 
 munity, and the resumption of specie payments necessarily involved a gen- 
 eral curtailment of discounts, and withdrawal of credit, which would pro- 
 duce a general and distressing pressure upon the entire class of debtors. 
 These constituted the largest portion of the population of all the States where 
 specie payments were suspended, and bank issues excessive. Those, there- 
 fore, who controlled public opinion in the States, where the depreciation of 
 the local paper was greatest, were interested in the perpetuation of the evil. 
 Deep and deleterious, therefore, as the disease evidently was, in many of 
 the States, their Legislatures could not have been expected to apply a remedy, 
 so painful as the compulsion of specie payments would have been, without 
 the aid of the Bank of the United States. And here it is worthy of special 
 remark, that, while that bank has compelled the local banks to resume specie 
 payments, it has most materially contributed, by its direct aid and liberal 
 arrangements, to enable them to do so, and that with the least possible embar- 
 rassment to themselves and distress to the community. If the State Legisla- 
 tures had been ever so anxious to compel the banks to resume specie payments, 
 and the banks ever so willing to make the effort, the committee are decidedly 
 of the opinion that they could not have done it, unaided by the Bank of the 
 United States, without producing a degree of distress incomparably greater 
 than has been actually experienced. They will conclude their remarks on 
 this branch of the subject by the obvious reflection, that, if Congress, at the 
 close of the war, had left it to the States to restore the disordered currency, 
 this important function of sovereignty would have been left with those from 
 
REPORT OF COMMITTEE, 1830. 75 [ 
 
 whom the constitution had expressly taken it, and by whom it could riot be 
 beneficially or effectually exercised. But another idea, of considerable plausi- 
 bility, is not without its advocates. It is said that this Government, by making 
 the resumption and continuance of specie payments the condition upon which 
 State banks should receive the Government deposites, might have restored 
 the currency to a state of uniformity. Without stopping to give their reasons 
 for believing that specie payments could not have been restored in this way, 
 and that, even if they could, a uniform currency of general credit, throughout 
 the Union, would not have been provided, the committee will proceed to give 
 their reasons for thinking that such a connexion between the Federal Govern- 
 ment and the State banks would be exceedingly dangerous to the purity of 
 both. While there is a national bank, bound by its charter to perform certain 
 stipulated duties, and entitled to receive the Government deposites as a com- 
 pensation, iixed by the law creating the charter, and only to be forfeited by 
 the failure to perform those duties, there is nothing in the connexion at all 
 inconsistent with the independence of the bank, and the purity of the Govern- 
 ment. The country has a deep interest that the bank should maintain specie 
 payments, and the Government an additional interest that it should keep the 
 public funds safely, and transfer them, fiee of expense, wherever they may 
 be wanted. The Government, therefore, has no power over the bank, but the 
 salutary power of enforcing a compliance with the terms of its charter. Ev- 
 ery thing is fixed by the law, and nothing left to arbitrary discretion. It is 
 true that the Secretary of the Treasury, with the sanction of Congress, would 
 have the power to prevent the bank from using its power unjustly and oppres- 
 sively, and to punish anv attempt, on the part of the directors, to bring the 
 pecuniary influence of the institution to bear upon the politics of the country, 
 oy withdrawing the Government deposites from the offending branches. But 
 this power would not be lightly exercised by the treasury, as its exercise would 
 necessarily be subject to be reviewed by Congress; it is, in its nature, a salu- 
 tary corrective, creating no undue dependence on the part of the bank. 
 
 But the state of things would be widely different, if there was no national 
 bank, and it was left to the discretion of the Secretary of the Treasury to se- 
 lect the local banks in \vhich the Government deposites should be made. All i 
 the State banks would, in that case, be competitors for the favor of the trea- 
 sury; and no one, who will duly consider the nature of this sort of patronage, 
 can fail to perceive, that, in the hands of an ambitious man, not possessed of 
 perfect purity and unbending integrity, it would be imminently dangerous to 
 the public liberty. The State banks would enter the lists of political contro- 
 versy, with a view to obtain this patronage; and very little sagacity; is requir- 
 ed to forsee, that, if there should ever happen to be an administration dispos- 
 ed to use its patronage to perpetuate its power, the public funds would be 
 put in jeopardy by being deposited in banks unworthy of confidence, and the 
 most extensive corruption brought to bear upon the elections throughout the 
 Union. A state of things more adverse to the purity of the Government 
 a power more liable to be abused can scarcely be imagined. If five millions 
 of dollars were annually placed in the hands of the Secretary of the Treasury, 1 
 to be distributed at his discretion, for the purposes of internal improvement, 
 it would not invest him with a more dangerous and corrupting power. ^ 
 
 In connexion with this branch of the subject, the committee will briefly ex- 
 amine the grounds of a complaint, sometimes made against the Bank of the 
 United States. It is alleged that this bank, availing itself of the Government 
 deposites, consisting in some places principally of local paper, makes heavy 
 and oppressive draughts on the local banks for specie, and thus compels them 
 to curtail their discounts, to the great injury of the community. In the first 
 place, it is to be remarked, that one of the highest duties of the bank the 
 great object for which it was established was to prevent the excessive issues 
 of local paper; and this duty can only be performed, by enforcing upon the 
 State banks the payment of specie for any excess in their issues. But the 
 committee are induced to believe, that this complaint is principally owing, so 
 far as it now exists, to the fact, that the operations of the federal treasury are 
 mistaken for the operations of the bank, because the bank is the agent by 
 
752 BANK OF THE UNITED STATES. 
 
 whom those operations are performed. This institution receives the Govern- 
 ment deposites in the paper of the local banks, certainly in no spirit of hos- 
 tility to those banks. On the contrary, it tends to give them credit, and is 
 designed to have that effect. But the Bank of the United States is not only 
 bound to pay in specie, or its own bills, what it receives for the Government 
 in local paper, but to transfer the funds to any part of the Union where they 
 mav be required for disbursement. Let it be assumed, that the Government 
 collects annually, at the custom house in Charleston, one million of dollars 
 in local bank notes, and disburses in South Carolina only one hundred thou- 
 sand, it would result from this, that the Government would have nine hun- 
 dred thousand dollars of local bank paper deposited in the Charleston branch, 
 which the batik would be bound by its charter, and for the national benefit, 
 to transfers perhaps to Washington or Norfolk As this paper would not answer 
 the purposes of the Government at those places, the bank would be, of course, 
 compelled to provide specie, or bills that will command specie at those places. 
 Jt is obvious, then, that it is the inequality in the collection and disbursement 
 of the revenue that produces the evil in question. If all the revenue collect- 
 ed in Charleston were disbursed in the State, no draughts would be made 
 upon the local banks for specie. The Bank of the United States, so far from 
 being justly obnoxious to any complaint on this score, has greatly mitigated 
 the action of the treasury upon the local banks, by means of the liberal ar- 
 rangements which its large capital and numerous branches have enabled it to 
 make with them. The degree in which that institution has reduced the rate 
 of exchange, may be fairly assumed as that in which it has mitigated the ac- 
 tion ot the treasury upon the State banks. If, for example, there existed no 
 national bank, and the deposites of the revenue collected in Charleston were 
 made in one of the local banks, what would be the effect of transferring, an- 
 nually, nine hundred thousand dollars to Washington or Norfolk? The local 
 banks, having no branches at either ot those places, instead of transmitting 
 drafts, as is now generally done, w r ould be compelled to transmit specie. 
 The bank in which the Government deposites were made, would consequent- 
 ly be under the necessity of demanding specie from all the other banks, in a 
 manner, and to an extent, much more oppressive than any thing that can be 
 imputed to the Bank of the United States. If, to avoid these specie drafts, 
 the local banks should purchase bills on AVashington or Norfolk, they would 
 probably cost five or six per cent, even in a tolerable state of the currency, 
 which would be a loss to the banks almost to the full extent of the premium. 
 
 Although the expediency of renewing the charter of the present bank is 
 not a question now submitted for the decision of Congress, the committee 
 consider it so far involved in the matter referred to them, as to render it their 
 duty to present some considerations bearing on that question, in addition to 
 what they have said on the general expediency of maintaining such an institu- 
 tion. If a national bank, s-.imilar to the present, be a necessary and proper 
 agent for the accomplishment of the great purposes heretofore indicated, the 
 only remaining question would seem to be, whether the charter of the present 
 stockholders should be renewed, or a new set of stockholders incorporated. 
 
 In considering this question, Congress will, of course, be governed in some- 
 degree by the terms on which the present stockholders will agree to accept a 
 renewal of their charter. But, as the committee have satisfactory reasons for 
 believing that terms eminently advantageous to the Government can be ob- 
 tained, they will proceed to some other inquiries. What, then, would be the 
 effect of refusing to renew the present charter? And, in the first place, what 
 are the inducements for pursuing that course? 
 
 It is sometimes alleged that the present stockholders are large capitalists, 
 and, as the stock of the bank is some twenty per cent, above par, that a re- 
 newal of the charter would be equivalent to a *rant to them of twenty per 
 cent, upon their capital. It is true, that a small proportion of the capital c*' 
 the company belongs to very wealthy men. Something more than two mil- 
 lions of that owned in the United States belongs to persons holding upwards 
 of one hundred thousand dollars each. It is also true, that foreigners own 
 
REPORT OF COMMITTEE, 1830. 753 
 
 seven millions, or one-fifth of the capital. But, on the other hand, it is to be 
 remarked that the Government, in trust for the People of the United States, 
 holds seven millions; that persons owning less than five thousand dollars each, 
 hold four millions six hundred and eighty-two thousand; and that persons 
 owning between five and ten thousand dollars each, hold upwards of three 
 millions. It is also worthy of remark, that a very considerable portion of the 
 stock, very nearly six millions, is held by trustees and guardians, for the use 
 of females and orphan children, and charitable and other institutions. Of the 
 twenty-eight millions of the stock which is owned by individuals, only three 
 millions four hundred and fifty-three thousand is now held by the original 
 subscribers. All the rest has oeen purchased at the market prices a large 
 portion of it, probably, when those prices were higher than at present. Most 
 of the investments made by wills, arid deeds, and decrees in equity, for the 
 use of females and minors, are believed to have been made when the stock 
 was greatly above par. From this brief analysis, it will appear that there is 
 nothing in the character or situation of the stockholders, which should make 
 it desirable to deprive them of the advantage which they have fairly gained, 
 by an application of their capital to purposes highly beneficial, as the commit- 
 tee have attempted to show, to the Government and People of the United 
 States. If foreigners own seven millions of the stock of the bank, our own 
 Government owns as much; if wealthy men own more than two millions, 
 men in moderate circumstances own between seven and eight millions; and 
 widows, orphans, and institutions devoted to charitable and other purposes, 
 own nearly six millions. 
 
 But, the objection that the stock is owned by men of large capital, would 
 apply with equal, if not greater force, to any bank that could be organized. 
 In the very nature of things, men who have large surplus capitals are the 
 principal subscribers at the first organization of a bank. Farmers and plan- 
 ters, merchants and manufacturers, having an active employment for their 
 capitals, do not choose to be the first adventurers in a bank project. Accord- 
 ingly, when the present bank went into operation, it is believed that most of 
 the capital was owned by large capitalists, and under a much more unequal dis- 
 tribution than exists at present. The large amount ot stock now held in trust 
 for females and minors, has been principally, if not entirely, purchased since 
 the bank went into operation; ana the same remark is generally applicable to 
 the stock in the hands of small holders. It is only when the character of a 
 bank is fully established, and when its stock assumes a steady value, that 
 these descriptions of persons make investments in it 
 
 It is morally certain, therefore, that, if another distinct institution were 
 created, on the expiration of the present charter, there would be a much great- 
 er portion of its capital subscribed by men of large fortunes, than is now own- 
 ed by persons of this description, of the stock of the United States' Bank. 
 Indeed, it might be confidently predicted, that the large capitalists who now 
 hold stock in that bank, would, from their local position and other advanta- 
 ges, be the first to forestall the subscriptions to the new bank, while the small 
 stockholders, scattered over the country, would be probably excluded, and 
 the females and minors, and others interested in trust investments made by 
 decrees in equity, would be almost necessarily excluded, as the sanction of 
 a court could scarcely be obtained, after the passage of the new act of incor- 
 poration, in time to authorize a subscription. 
 
 T9 destroy the existing bank, therefore, after it has rendered such signal 
 services to the country, merely with a view to incorporate another, would be an 
 act rather of cruelty and caprice, than of justice and wisdom, as it regards 
 the present stockholders. It is no light matter to depreciate the property of 
 individuals, honestly obtained, and usefully employed, to the extent of five 
 millions six hundred thousand dollars, and the property of the Government, 
 to the extent of one million four hundred thousand dollars, purely for the 
 sake of change. It would indicate a fondness for experiment, which a wise 
 Government will not indulge upon slight considerations. 
 95 
 
754 BANK OF THE UNITED STATES. 
 
 But the great injury which would result from the refusal of Congress to re- 
 new the charter of the present bank, would, beyond all question, be that which 
 would result to the community at large. It would be difficult to estimate the 
 extent of the distress which would naturally and necessarily result from the 
 sudden withdrawal of more than forty millions of credit, which the community 
 now enjoys from the bank. But this would not be the full extent of the ope- 
 ration. The Bank of the|United States, in winding up its concerns, would 
 not only withdraw its own paper from circulation, and call in its debts, but 
 would unavoidaly make such heavy draughts onthelocal institutions for specie 
 as very greatly to curtail their discounts. The pressure upon the active, in- 
 dustrious, snd enterprising classes, who depend most on the facilities of bank 
 credit, would be tremendous. A vast amount of property would change 
 hands at half its value, passing,under the hammer, from the merchants, manu- 
 facturers, and farmers, to the large moneyed capitalists, who always stand 
 ready to avail themselves of the pecuniary embarrasments of the community. 
 The large stockholders of the present bank, the very persons whose present 
 lawful gains it would be the object of some to cut on, having a large surplus 
 money capital thrown upon their hands, would be the very hrst to speculate 
 upon the distresses of the community, and build up princely fortunes upon the 
 ruins of the industrious and active classes. On the other hand, the females 
 and minors, and persons in moderate circumstances, who hold stock in the 
 institution, would sustain an injury, in no degree mitigated by the general dis - 
 tress of the commuuity. 
 
 A very grave and solemn question will be presented to Congress, when they 
 come to decide upon the expediency of renewing the charter of the present 
 bank. That institution has succeeded in carrying the country through the 
 painful process necessary to cure a deep seated disease in the national cur- 
 rency. The nation, after having suffered the almost convulsive agonies of 
 this necessary remedy, is now restored to perfect health. In this state of 
 things, it will be for Congress to decide whether it is the part of wisdom to 
 expose the country to a degree of suffering, almost equal to that which it has 
 already suffered, for the purpose of bringing back that very derangement of 
 the currency, which has been remedied by a process as necessary as it was 
 distressing. 
 
 If the Bank of the United States were destroyed, and the local institutions 
 
 compel them either to curtail their discounts, when most needed, or to sus- 
 pend specie payments. It is not difficult to predict which of these alter 
 natives they would adopt, under the circumstances in which they would be 
 placed. The imperious w r ants of a suffering community would call for dis- 
 counts, in language which could not be disregarded. The public necessities 
 would demand, and public opinion would sanction, the suspension, or at least 
 an evasion of specie payments. 
 
 But, even if this desperate resort could be avoided in a period of peace and 
 general prosperity, neither reason nor experience will permit us to doubt that 
 a state of war would speedily bring about all the evils which so fatally affected 
 the credit of the Government and the national currency, during the late war 
 with Great Britain. We should be again driven to the same miserable round 
 of financial expedients, which, in little more than two years, brought a 
 wealthy community almost to the very brink of a declared national bank- 
 mptcy, and placed the Government completely at the mercy of speculating 
 stockjobbers. 
 
 The committee feel warranted, by the past experience of the country, in 
 expressing it as their deliberate opinion, that, in a period of war, the financial 
 resources of the country could not be drawn into efficient operation, without 
 the aid of a national bank, and that the local banks would certainly resort to 
 a suspension of specie payments. The maxim is eminently true, in modern 
 times, that money is the sinew of military power. In this view of the sub- 
 
ttfcPORT OF COMMITTEE, 1830 755 
 
 ject, it docs appear to the committee, that no one of the institutions of the 
 country, not excepting the army or navy, is of more vital importance than a 
 national bank. It has this decided advantage over the army and navy : while 
 they are of scarcely any value except in war, the bank is not less useful than 
 either of them in war, and is also eminently useful in peace. It has another 
 advantage, still greater. If, like the army or navy, it should cost the nation 
 millions annually to sustain it, the expediency of the expenditure might be 
 doubted. But, when it actually saves to the Government and to the country, 
 as the committee have heretofore attempted to show, more millions annually 
 than are expended in supporting both the army and navy, it would seem that, 
 if there were any one measure of national policy, upon which all the political 
 parties of the country should be brought to unite, by the impressive lessons of 
 experience, it is that of maintaining a national bank. 
 
 It is due to the persons, who, for the last ten years, have been concerned 
 in the administration of the bank, to state, that they have performed the deli- 
 cate and difficult trust committed to them, in such a manner, as, at the same 
 time, to accomplish the great national ends for which it was established, and 
 promote the permanent interest of the stockholders, with the least practica- 
 ble pressure upon the local banks. As far as the committee are enabled to 
 form an opinion, from careful inquiry, the bank has been liberal and indul- 
 gent in its dealings with these institutions, and, with scarcely an exception, 
 now stands in the most amicable relation to them. Some of those institutions 
 have borne the most disinterested and unequivocal testimony in favor of the 
 bank. \ 
 
 It is but strict justice also to remark, that the direction of the mother bank 
 appears to have abstained, with scrupulous care, from bringing the power and 
 influence of the bank to bear upon political questions, and to have selected, 
 for the direction of the various branches, business men, in no way connected 
 with party politics. The committee advert to this part of the conduct of the 
 directors, not only with a view to its commendation, but for the purpose of 
 expressing their strong and decided conviction that the usefulness and stabi- 
 lity of such an institution will materially depend upon a steady and undevi- 
 ating adherence to the policy of excluding party politics and political parti- 
 zans from all participation in its management. It is gratifying to conclude 
 this branch oi the subject, by stating that the affairs of the present bank, 
 under the able, efficient, and faithful guidance of its two last presidents, and 
 their associates, have been brought from a state of great embarrassment, into 
 a condition of the highest prosperity. Having succeeded in restoring the 
 paper of the local banks to a sound state, its resources arc now such as to 
 justify the directors in extending the issue and circulation of its paper, so as 
 to satisfy the wants of the community, both as it regards bank accommodations 
 and a circulating medium. Upon the soundest principles of banking, the 
 very ample resources of the institution would justify the directors in grant- 
 ing accommodations to a much greater extent than they have yet done; and 
 though they have increased the circulation of their paper from four and a half 
 to fourteen millions, since January, 1823. they are ready and willing t9 in- 
 crease it still further, by discounting bills of exchange and other business 
 paper. It is believed that the discounts and issues of the institution are now 
 actually limited by the vyant of application resting upon these, the only sub- 
 stantial and safe foundations of bank credit and circulation. 
 
 III. Having said thus much on the constitutionality and expediency of an 
 incorporated National Bank, the only question which remains to be examined 
 by the committee is^ the expediency of establishing "a National Bank founded 
 upon the credit of the Government and its revenues." 
 
 It is presumed to have been the intention of the President, in suggesting 
 the inquiry as to a bank founded upon the credit and revenues of the Govern- 
 ment, to be understood as having allusion to a bank of discount and deposite. 
 Such a bank, it is taken for granted, would have branches established in va- 
 rious parts of the Union, similar to those now established by the Bank of the 
 United States, and co-extensive with them. The great object of furnishing 
 
756 BANK OF THE UNITED STATES. 
 
 a national currency could not be accomplished, with an approach to unifor- 
 mity, without the agency of such branches; and another object, second only 
 in importance to the one just stated, the extension of the commercial facili- 
 ties of bank accommodations to the different parts of the Union, could not be 
 at all effected without such agency. If there should be simply a great central 
 bank established at the seat of Government, without branches to connect its 
 operations with the various points of the commerce of the Union, the promise 
 to pay specie for its notes, whenever presented, would be almost purely no- 
 minal. Of what consequence would it be to a merchant or planterof Louisi- 
 ana, or a manufacturer or farmer of Maine, that he could obtain specie for 
 bills of the National Bank, on presenting them at the city of Washington 
 a place wholly unconnected either with Louisiana or Maine, by any sort of 
 commercial intercourse, and where, consequently, these bills would never 
 come in the regular course of trade? A promise to pay specie at a place so 
 remote from the place of circulation, and where the bills would never come 
 but at a great expense, and for the sole purpose of being presented for pay- 
 ment, would neither give credit to the notes, nor operate as an effective check 
 upon excessive issues. Whatever credit such notes might have at a distance 
 from the place of issue, would not be because they were redeemable at the 
 pleasure of the holder, for such would not be the fact; but principally because 
 ol the ultimate responsibility of the Government, and of their being receiva- 
 ble in payment of all dues to the treasury. They would rest, therefore, upon 
 almost precisely the same basis of credit as the paper money of our Revolu- 
 tion, the assignats of revolutionary France, and the treasury notes of the 
 late war. These were receivable in discharge of debts due to the treasury, 
 and the Government was of course ultimately responsible for their payment; 
 yet the two former depreciated almost to nothing, and the latter, though bear- 
 ing interest, sunk to twenty per cent, below par. But the notes of a central 
 Government Bank r without branches, would be subject to depreciation from 
 a cause which constitutes a conclusive objection to such an institution. 
 There would be nothing to limit excessive issues but the discretion and pru- 
 dence of the Government or of the direction. Human wisdom has never de- 
 vised any adequate security against the excessive issues, and, consequently;,, 
 the depreciation of bank paper, but its actual, and easy, and prompt converti- 
 bility into specie, at the pleasure of the holder. Experience has shown that* 
 where the paper of a bank is, by any means, habitually circulated at places 
 remote from the point where it is issued, and not connected with it by a re- 
 gular commercial intercourse, there will not exist that easy and prompt con- 
 vertibility which is so essential to the credit of bank paper. When bank bills- 
 are confined to their appropriate sphere of circulation, a redundant issue ia 
 certainly and immediately followed by a run upon the bank for specie. This 
 timely admonition is as useful to the bank as it is to the community: for it en- 
 ables the directors to avoid, with unfailing certainty, an excess equally inju- 
 rious to- both, and which no human sagacity could anticipate or prevent, by 
 calculation merely. Whatever, _ therefore, in a system of bank circulation, pre- 
 vents the reflux of redundant issues, necessarily destroys the only adequate 
 security against these injurious and ruinous excesses. 
 
 But a Government Bank, without branches, would be obnoxious to another 
 objection, which could not be obviated. Its loans would be confined to the 
 District of Columbia; or, if extended to the various parts of the Union, to say 
 nothing of the inconvenience to which it would expose those at a distance, who 
 obtained accommodations, they would be unavoidably granted without any 
 knowledge of the circumstances of the persons upon whose credit the Govern- 
 ment would depend for re-payment. It would, in fact, be, for all useful pur- 
 poses, a mere District Bank. 
 
 These views of the subject have brought the committee to the conclusion* 
 that, if a Government Bank should be established, it would have at least as 
 many branches as the Bank of the United States, and probably a much great- 
 er number. Few administrations would have the firmness to resist an appli- 
 cation to establish a branch, coining from any quarter of the Union, however 
 
REPORT OF COMMITTEE, 1830. 757 
 
 injudicious the location might be, upon correct principles of commerce and 
 banking. 
 
 The Bank of the United States now employs five hundred agents, in the 
 various parts of the Union, where its offices are established. From this fact 
 some idea may be formed of the very great addition which would be made to 
 the patronage of the Executive Government, by the establishment of such a 
 bank as the one under consideration. 
 
 But the patronage resulting from the appointment, the annual appointment, 
 of these agents, great as it would doubtless be, would be insignificant and 
 harmless, when compared to that which would result from the dispensation of 
 bank accommodations to the standing amount of at least fifty millions of dol- 
 lars ! The mind almost instinctively shrinks from the contemplation of an idea 
 so ominous to the purity of the Government, and the liberties of the People. 
 No government of which the committee have any knowledge, except, perhaps, 
 the despotism of Russia, was ever invested with a patronage at once so prodi- 
 gious in its influence, and so dangerous in its character. In the most despe- 
 rate financial extremities, no other European government has ever ventured 
 upon an experiment so perilous. If the whole patronage of the English mo- 
 narchy were concentrated in the hands of the American Executive, it may be 
 well doubted whether the public liberty would be so much endangered by it, 
 as it would by this vast pecuniary machine, which would place in the hands 
 of every administration fifty millions of dollars, as a fund for rewarding politi- 
 cal partizans. 
 
 Without assuming that a corrupt use would be made of this new species of 
 Government patronage, a very slight acquaintance with the practice of all po- 
 litical parties, whatever may be their professions, will be sufficient to satisfy 
 any reflecting mind that all the evil consequences of corruption would flow 
 from its exercise. Have not our political contests too frequently degenerated 
 into a selfish scramble for the offices of the country? Are there not those 
 who sincerely and honestly believe that these offices are legitimate objects of 
 political warfare, and the rightful reward of the victorious party? And, dis- 
 interested and patriotic as the great body of every political party is admitted 
 to be, the fact is no less true than it is lamentable ? that the most devoted and 
 active partizans are very often mere soldiers of fortune, who watch the poli- 
 tical signs, and enlist at the eleventh hour, under the banners of the party 
 most likely to prove successful. Such being, more or less, the composition 
 of all political parties, what would be the probable use made of fifty millions 
 of bank patronage, by a political party which conscientiously held the doctrine 
 thatall the offices in the gift of the Executive should be divided among the 
 partizans of a successful political leader? Would not the same principle be 
 even more applicable to bank loans? And would not the treasury of the Unit- 
 ed States, under the sanctifying influence of party delusion and party infatua- 
 tion, be literally plundered by mercenary retainers, bankrupts in fortune, and 
 adventurers in politics? 
 
 Even if the administration should be ever so much disposed to restrain the 
 abuse of this patronage, it would be utterly impracticable to exercise any effi- 
 cient control over the great number of bank directors who would be scattered 
 over the Union, and who, upon all the known principles of human nature, it 
 may be confidently predicted, would principally consist of busy and officious 
 political partizans. 
 
 Such would be the depositories, acting, not under the public eye, but under 
 the protecting mystery of a sort of concealment and secrecy, deemed indispen- 
 sable in banking operations, to whom not only the whole treasury of the Union 
 would be confided, to be squandered, perhaps, in profligate favoritism, but 
 the tremendous power of putting the \yhole property of the nation under 
 mortgage, for the redemption of the bills issued at their discretion. To say 
 nothing of the utter insecurity of the public revenues under such a system, a 
 new species of legislative power, unknown to the constitution, would be com- 
 mitted to these irresponsible bank driectors, of which no human sagacity can 
 predict the consequences. 
 
758 BANK OF THE UNITED STATES 
 
 A just analysis of the operation of" granting loans by this Government 
 bank, in exchange for the notes of private individuals, will show, that it in- 
 volves the exercise, on the part of the directors, of the two-fold power of ap- 
 propriating the public revenue in the most dangerous of all forms, discretion- 
 ary loans, and of pledging the reponsibility of the Government, to an unlimited 
 extent, for the payment of the debts at the same time created against it. 
 These are among the highest functions of legislative power, and have been 
 expressly and exclusively vested in Congress. Unless, therefore, it be as- 
 sumed that Congress may rightfully transfer the powers with which it is in- 
 vested to these bank directors, it will be difficult to find any warrant, either 
 in the letter or spirit of the constitution, for the creation of this tremendous 
 engine of pecuniary influence. It may ? indeed, be doubted, whether all the 
 branches of the legislative authority united have any constitutional power to 
 lend the public revenue, either to individuals, corporations, or States, with- 
 out reference to the objects to which it shall be applied. But, \yhatever may 
 be the power of Congress on this subject, it appears to the committee to be in- 
 expedient, in every view of the question, that the Government should be con- 
 verted into a great money lender. There is no species of trade in which it 
 would be wise for the Government to embark; but of all the variety of pur- 
 suits known to human enterprise, that of lending money by the Government 
 to the citizens of the country, would be fraught with the most pernicious con- 
 sequences. 
 
 In the first place, it is a business to which, in the very nature of things, no 
 government is adapted, and, least of all, a popular government. There is 
 no employment of capital that requires a more vigilant and skilful superin- 
 tendence. Nothing but the ever active motive of individual interest can sup- 
 ply the watchfulness necessary to secure a banking institution against the 
 grossest frauds and impositions. In pecuniary transactions, few men are to 
 be found who will serve others, in cases involving the exercise of discretiona- 
 ry power, with the same fidelity that they would serve themselves; and when 
 we consider the strong motives, both of private friendship and political at- 
 tachment, which would operate on the directors of a government bank, to 
 bestow its favors without impartiality or prudence, it requires but little saga- 
 city to foresee that enormous losses would be annually sustained hy the insol- 
 vency of the government debtors. 
 
 All governments have found it expedient to place the public treasury un- 
 der the guardianship of a high and confidential officer, aided, in the enforce* 
 ment ot a rigid responsibility, by a system of checks and counterchecks, ope- 
 rating upon all the subordinate officers concerned in collecting and disburs- 
 ing the public revenue. Such is our own system. No discretion is vested 
 in the chief officer of the treasury, much less in those that are sudordinate, 
 in the appropriation of a single dollar of the public money. " No money 
 can be drawn from the treasury but in consequence of appropriations 
 made by law." How far these wise and provident safeguards, and this con- 
 stitutional barrier, would be prostrated by placing not only the public re- 
 venue, but the public credit, at the disposal of some hundreds of bank di- 
 rectors, in various parts of the Union, is a very grave question for the conside- 
 ration of the House. 
 
 Our own experience has demonstrated the great danger of having large 
 masses of the community indebted to the Government. It was a deep convic- 
 tion of this danger that induced Congress to abolish the system of credit 
 sales in the disposition of the public lands. Congress has been compelled to 
 yield to the pressing importunities of the purchasers of these lands, bv grant- 
 ing them not only repeated indulgencies, but by remitting some millions of 
 the debt. What, then, would be the situation of the Government, with a debt 
 of fifty millions diffused throughout the country, and due to it from the most 
 active, enterprising, and influential classes of the community? Nothing that 
 has not happened can be more certain, than that every unfavorable vicissitude 
 in trade, every period of commercial distress and embarrassment, would give 
 rise to importunate and clamorous calls for indulgence, and for an injudicious 
 
REPORT OF COMMITTEE, 1830. 759 
 
 extension of discounts, which no administration would have the firmness to re- 
 sist. Every one who has witnessed the urgency and unanimity with which the re- 
 presentatives of the States indebted for public lands, have pressed the claims 
 of their citizens for indulgence and remission, must be satisfied that, if the 
 cittzens of all the States should become indebted much more largely for bank 
 loans, the Government would have scarcely any faculty of resistance, when 
 appeals for indulgence should come from all quarters of the Union, sustained 
 by the strong plea of public distress and embarrassment. 
 
 The policy of extending indulgence to the. public debtors, and of granting 
 more liberal loans to the community, would, m the natural course of things, 
 become the favorite theme of those who aspired to popular favor. Political 
 parties would come to be divided upon the question of observing towards the 
 public debtors a strict banking policy, indispensable to the maintenance of 
 specie payments, on the one hand, or a liberal Government policy, necessa- 
 rily involving a suspension of specie payments, on the other. Ana when it is 
 considered that the whole class of debtors, always the most numerous and 
 active portion of the community ? would be naturally in favor of increasing 
 bank issues, and extending bank indulgences, it can scarcely be doubted that 
 specie payments would be suspended in the first great pecuniary exigency, 
 growing out of embarrassments in our commerce, or deficiencies in our re- 
 venue. 
 
 The Government, therefore, which is under the most sacred obligations to 
 constrain all the banks to maintain specie payments, with a view to the uni- 
 formity and soundness of the currency, would, by its own example, perpetuate 
 the great national evil of a fluctuating and depreciated circulating medium. 
 
 These evils, which would be so highly probable in time of peace, would be 
 almost certain in the event of war. 'Ihe temptation to supply the Federal 
 treasury by the easy process of bank issues, rather than resort to the unpopu- 
 lar process of internal taxation, would be too fascinating to be resisted. We 
 should thus experience, what every nation has experienced in like circum- 
 stances, the manifold evils of a mere paper currency, haying no relation to 
 any standard of intrinsic value. In these views the committee are fully sus- 
 tained by the opinion of Mr. Lowndes, expressed in 1819. These are his 
 words: " That the destruction of the [United States] Bank would be follow- 
 ed by the establishment of paper money, he firmly believed,- he might almost 
 say, he knew. It was an extremity trom which the House would recoil, if 
 now proposed; but, if the resolution on the table were passed, it would very 
 soon be proposed. The subject was too large for an incidental discussion. 
 Gentlemen thought the amount of Government paper might be limited, and 
 depreciation prevented, by the rate of interest which should be exacted. In- 
 adequate every where, the security was particularly ineffectual in the United 
 States." 
 
 But the inevitable tendency of a Government bank to involve the country 
 in a paper system, is not, in the opinion of the committee, the greatest objection 
 to it. The powerful, and, in the hands of a bad administration, the irresisti- 
 ble and corrupting influence which it would exercise over the elections of 
 the country, constitutes an objection more imposing than all others united. 
 No matter by what means an administration might get into power, with such 
 a tremendous engine in their hands it would be almost impossible to displace 
 them, without some miraculous interposition oj* Providence. 
 
 Deeply impressed with the conviction that the weak point of a free Govern- 
 ment is the absorbing tendency of Executive patronage, and sincerely believ- 
 ing that the proposed bank would invest that branch of the Government with 
 a weight of moneyed influence, more dangerous in its character, and more pow- 
 erful in its operation, than the entire mass of its present patronage, the com- 
 mittee have felt that they were imperiously called upon, by the highest con- 
 siderations of public duty, to express the views they have presented, with a 
 frankness and freedom demanded by the occasion. It is, at the same time, 
 due to their own feelings, that they should state, unequivocally, their convic- 
 tion, that the suggestion of the Chief Magistrate, which they have thus freely 
 
760 BANK OF THE UNITED STATES. 
 
 examined, proceeded from motives of the most disinterested patriotism, and 
 was exclusively designed to promote the welfare of the country. This is not 
 the mere formal and heartless homage, sometimes offered up to official station, 
 either from courtesy or interest, but a tribute which is eminently due, and 
 cheerfully rendered, to the exalted character of the distinguished individual 
 
 on whom it is bestowed. 
 
 Extracts of a letter from an intelligent merchant in Charleston, South Caro- 
 lina^ to the Chairman of the Committee of Ways and Means* illustrating 
 the exchange operations of the Bank of the United States, and accompany- 
 the foregoing report. 
 
 44 This effect of diminishing the vast difference of exchange between the 
 various points of the country, was evidently produced by the bank. The ad- 
 vantages produced by this institution, in the intercourse between the Western 
 and Atlantic States, can be duly appreciated only by one who sees, passing 
 before him, the actual operation of the system of exchange it has created. For 
 example: Lexington, in Kentucky, annually accumulates a large surplus of 
 funds to her credit in Charleston, derived from the sale of horses, hogs, and 
 other live stock, driven to that as well as to other Southern markets by her 
 citizens. Philadelphia is indebted to Charleston for exchange remitted, divi- 
 dends on bank stock, &c. and Lexington is indebted to Philadelphia for mer- 
 chandise. Without the transportation of a single piece of coin, Lexington 
 draws on Charleston, and remits the check to Philadelphia in payment of her 
 debt there; which operation adjusts the balance between the three points of 
 the triangle, almost without expense or trouble. Could such facilities be ob- 
 tained from any other than an institution having branches in different parts of 
 the Union, acting as co-partners in one concern? Local banks, whatever 
 might be their willingness, could not accommodate in the same manner, and 
 to a like extent." 
 
 44 The discounting of bills, on the low terms established by the branch bank 
 at this place, is a great benefit to the agricultural interest, particularly in en- 
 hancing the price of cotton and rice; and were the bank to stop its operations, 
 there is no saying how far these staples would be depressed. The private 
 dealers in exchange would take the place of the bank in that business, and 
 their profits on bills would be taken out of the pockets of the planters, as the 
 merchants would always regulate the price they would give for an agricultu- 
 ral production, by the high or low rate at which they could negotiate their 
 bills. On account of its connexion with all parts of the Union, the bank 
 affords this important advantage to the public: it is always a purchaser and 
 always a seller of exchange, at fixed and low rates, and thus prevents extor- 
 tion by private dealers." 44 Before this 
 Ibank went into operation, exchange was from eight to ten percent., either for 
 or against Charleston, which was a loss to the planter to that amount on all 
 the produce of Georgia and South Carolina, and, indeed, you might say, all 
 the produce of the Southern and Western States." 
 44 If the Bank of the United States were destroyed, the local banks would 
 again issue their paper to an excessive amount; and while a few adventurous 
 speculators would be much benefi tted by such an issue, the honest and unsus- 
 pecting citizens of pur country would, finally, be the losers. If we look back 
 to what took place in New York, Pennsylvania, the Western States, and even 
 in our own State, we shall see the grossest impositions committed by banks, 
 commencing with a few thousand dollars in specie, buying up newspapers to 
 puff them as specie paying banks, in order to delude the public, and, after 
 getting their bills in circulation, blowing up, and leaving the unsuspecting 
 planter and farmer victims of a fraud, by which they were deprived of the 
 hard earnings of years of honest industry. But, sir, I believe the bank owes 
 a great deal of the opposition which exists, and has existed, to the fact that 
 
REPORT OF COMMITTEE, 1830. 751 
 
 it has put down these fraudulent institutions, got up by combinations and 
 conspiracies of speculators; and who, after receiving large dividends, ma- 
 naged to destroy the credit of their own paper, and, by the agency of brokers, 
 bought it up at half its nominal value. 
 
 " Since I last wrote you, I had a conversation with a gentleman in the con- 
 fidence of some of the moneyed men of the North, and he says they are deter- 
 mined to break up the United States' Bank, to enable them to use their mo- 
 ney to advantage; as that institution gives so many facilities to the communi- 
 ty, as to deprive them of their former profits." 
 
 '"There is another consideration: the distress would be immense, which a 
 refusal to renew the charter would produce among those who are indebted to 
 Ihe institution: for I find that, to this branch, the planters owe upwards of a 
 million of dollars; and I have no hesitation in saying, as safe a debt as is ow- 
 ing to any bank in the Union. But if the bank should wind up its affairs, 
 these planters could not get credit from other institutions; and as the bank 
 can sue in the United States' court, where judgment is obtained almost at 
 once, property would be greatly depressed, and moneyed men would buy it 
 up for half its value. Throughout me Union, all classes would suffer, except 
 those who should hold up their money to go into the brokerage business, or 
 buy property at a sacrifice. If I were sure the bank would not be re-char- 
 tered, I would convert my property into money, with a view to dealing in ex- 
 change. I could make a vast fortune by it," 
 
 96 
 
762 
 
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REPORT OF COMMITTEE, 1830. 
 
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REPORT OF COMMITTEE, 1830. 
 
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7(58 BANK OF THE UNITED STATES. 
 
 APPENDIX, No. 3. List of 7*ransfers by the Secretary of the Treasury from 
 and to Bank United States and Offices, from Gth June to 14th Dec. 1829. 
 
 No. 
 
 Date. 
 
 Where from. Where to, 
 
 Amount. 
 
 1 
 2 
 
 June 8, 1829 
 
 44 4< 
 
 New York, - Washington, 
 Bank United States, j Ditto, 
 
 $100,000 
 50,000 
 
 3 
 
 t ; 44 
 
 New York, 
 
 Ditto, 
 
 150,000 
 
 
 
 Ditto, 
 
 Bank United States, 
 
 1,865,000 
 
 
 
 New Orleans, 
 
 Ditto, 
 
 75,000 
 
 
 
 Louisville, 
 
 Ditto, 
 
 50,000 
 
 
 
 Cincinnati, 
 Bank United States, 
 
 Ditto, 
 Baltimore, 
 
 115,000 
 135,000 
 
 
 
 Ditto, 
 
 Norfolk, 
 
 80,000 
 
 
 
 Ditto, 
 
 Fayetteville, 
 
 20,000 
 
 
 
 Ditto, 
 
 Charleston, 
 
 200,000 
 
 
 
 Ditto, 
 
 Savannah, 
 
 15,000 
 
 
 
 Ditto, 
 
 Mobile, 
 
 35,000 
 
 
 
 Portland, 
 
 Portsmouth, 
 
 20,000 
 
 
 
 Ditto, 
 
 Boston, 
 
 90,000 
 
 
 
 New York, - 
 
 Ditto, 
 
 40,000 
 
 
 
 Providence, 
 
 New York, - 
 
 140,000 
 
 
 
 Hartford, 
 
 Ditto, 
 
 35,000 
 
 
 
 New York, - 
 
 Richmond, 
 
 70,000 
 
 
 
 Ditto, 
 
 Charleston, 
 
 80,000 
 
 
 
 Cincinnati, - 
 
 Pittsburgh, - 
 
 15,000 
 
 31 
 
 July 8, " 
 
 New York, - 
 
 Washington, 
 
 100,000 
 
 32 
 
 Aug. 3, " 
 
 Ditto, 
 
 Ditto, 
 
 100,000 
 
 33 
 
 44 44 
 
 Baltimore, 
 
 Ditto, 
 
 50,000 
 
 
 Sept. 1, " 
 
 New York, - 
 
 Ditto, 
 
 100,000 
 
 
 9, 
 
 44 44 
 
 Louisville, 
 Charleston, - 
 
 Pittsburgh, - 
 Fayetteville, 
 
 20,000 
 10,000 
 
 
 (4 4C 
 
 Bank United States, 
 
 Norfolk, 
 
 20,000 
 
 
 4' 44 
 
 New York, - 
 
 Ditto, 
 
 20,000 
 
 
 44 44 
 
 Louisville, 
 
 Nashville, 
 
 20,000 
 
 44 
 45 
 
 14, " 
 
 (4 44 
 
 New York, - 
 Boston, 
 
 Washington, 
 Ditto, 
 
 100,000 
 40,000 
 
 47 
 
 21, " 
 
 Charleston, 
 
 Fayetteville. 
 
 20,000 
 
 49 
 
 Oct. 5, " 
 
 New York, - 
 
 Norfolk, 
 
 50,000 
 
 50 
 
 12, " 
 
 Ditto, 
 
 Washington. 
 
 100,000 
 
 51 
 
 Nov. 2, " 
 
 Bank United States, 
 
 Norfolk, 
 
 50,000 
 
 52 
 
 (4 44 
 
 New York, - 
 
 Washington, 
 
 100,000 
 
 53 
 
 
 Boston, 
 
 Ditto, 
 
 50,000 
 
 63 
 
 
 Bank United States, 
 
 Norfolk, 
 
 50,000 
 
 64 
 
 
 New York, - 
 
 Washington, 
 
 100,000 
 
 65 
 
 
 Ditto, 
 
 Norfolk, 
 
 50,000 
 
 66 
 
 
 Ditto, 
 
 Washington, 
 
 100,000 
 
 67 
 
 
 Bank United States, 
 
 Ditto, 100,000 
 
 68 
 
 
 Boston, 
 
 Ditto, 
 
 25,000 
 
 69 
 
 Dec. 14,1829 
 
 Ditto, 
 
 Bank United States, 
 
 500,000 
 
 70 
 
 a 44 
 
 New York, - 
 
 Ditto, 
 
 1,000,000 
 
 71 
 
 44 44 
 
 New Orleans, 
 
 Ditto, 
 
 400,000 
 
 72 
 
 44 44 
 
 Bank United States. 
 
 Baltimore, 
 
 300,000 
 
 73 
 74 
 
 44 (( 
 (I 4( 
 
 Ditto. 
 Savannah, 
 
 Charleston, 
 Norfolk, 
 
 50,000 
 50,000 
 
 
 
 
 
 $7,055,000 
 
 From the above statement, the annual amount of the transfers made for the Govern- 
 ment, free of expense, may be inferred. 
 
REPORT OF COMMITTEE. 1830- 
 
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1TZ BANK OF THE UNITED STATES. 
 
 State of the, Bank of the United States, April i, 1830. 
 
 Notes discounted, $32,138,270 89 
 
 Domestic bills discounted, 10,506,882 54 
 
 Funded debt held by the bank, - 11,122,530 90 
 
 Real estate, - 2,891,890 75 
 
 Funds in Europe, equal to specie, - 2,789,498 54 
 
 Specie, 9,043,748 97 
 
 Public deposites, - 8,905,501 87 
 
 Private deposites, - 7,704,256 87 
 
 Circulation, - - * 16,083,894 00 
 
 IN SENATE. 
 
 MARCH 29, 1830. 
 Mr. SMITH, of Maryland, made the following report: 
 
 The Committee on Finance, to which yvas referred a resolution of the 30th 
 December, 1829, directing the committee to inquire into the expediency of 
 establishing an uniform national currency for the United States, and to re- 
 port thereon to the Senate, report: 
 
 That nothing, short of the imperative order of the Senate, could induce the 
 committee to enter on a subject so surrounded with difficulty. They under- 
 take it with diffidence, and a distrust of their capacity to elucidate a subject 
 that has engaged many nations and the pens of the ablest writers, without, aa 
 yet, coming to anv definite conclusion. It still remains to be determined, 
 What is the soundest and most uniform currency? One nation assumes one 
 system, another a different plan. In one nation, a plan is devised, and suc- 
 ceeds, for a time, by prudent and restrictive emissions. Elated with success, 
 larger and more extensive emissions are risqued; a rapid nominal ri=>e of all 
 property takes place; the people are not aware that such nominal rise is the 
 effect of depreciation; the bubble bursts, and ruin to the unsuspecting is the 
 consequence. All history show3 such a result in several nations, and, par- 
 ticularly, in that of the United States. The committee, engaged on a variety 
 of subjects, cannot devote so much time on the resolution as the mover must 
 believe would be necessary to develop fully the question before them, to wit: 
 A sound and uniform national currency. Presuming, from the tenor of the 
 resolution, that the uniform national currency proposed must be prepared by 
 the National Government, circulated under its authority, and mantained by 
 its credit, the committee have complied with the instruction of the Senate, by 
 endeavoring to devise some plan, through which the agency of the Govern- 
 ment, in such a measure, could be safe or useful; but, after giving to it all 
 the consideration they could bestow, their reflections have resulted in a be- 
 lief that any such measure must resolve itself, at last, into a mere system of 
 paper money, issued by the Government. The resort to the issue of a paper 
 money has been often the desperate expedient of the wants of a nation. It 
 has then found its justification only in the necessity which created it: yet, 
 such are its inevitable evils, that every prudent Government has, the moment 
 its pressing exigencies permitted, returned to the only safe basis of a circula- 
 ting medium the precious metals, and the private credits attached to the use 
 of them. Such were the expedients of the Government of the United States 
 during its two wars; such its immediate abandonment of them at the return 
 
 * This is the circulation from the office returns. We know, however, that a part 
 of it is received at other offices, and is in passage from one to the other. So that the 
 nett circulation is $14,176,927. 
 
REPORT OF SENATE COMMITTEE, 1830, 773 
 
 of peace. But, in the present condition of the treasury of the United States, 
 with a revenue far beyond its wants, with a debt almost nominal, and hasten- 
 ing to its entire extinguishment, such a measure is not needed by the interests 
 of the Government, nor is there the slightest indication of its being demanded 
 by the wants of the country. Of such an issue of paper money, the Execu- 
 tive at Washington would be the natural fountain. The agents of the Execu- 
 tive, the natural channels. The individuals, and corporations, and States, 
 who borrowed it, must become debtors to the Government; and the inevitable 
 consequence would be ? the creation of a moneyed engine, of direct depen- 
 dence on the officers oj Government, at variance with the whole scheme of our 
 institutions. The limit to which this currency should be issued, the persons 
 to whom it would be lent, the securities taken for its repayment, the places 
 where it should be redeemed, involve great complication and great hazard, 
 regarding it merely in a financial point of view; while, on more enlarged con- 
 siderations of political expediency, the objections to it are, in the opinion of 
 the committee, insuperable and fatal. 
 
 Believing such a scheme to be impracticable, the committee were consoled 
 with the reflection that it is unnecessary, as they are satisfied that the coun- 
 try is in the enjoyment of an uniform national currency, not only sound and 
 uniform in itself, and perfectly adapted to all the purposes of the Government 
 and the community, but more sound and uniform than that possessed by any 
 other country. The importance of this truth will justify the committee in 
 stating some details to establish it. 
 
 The currency of the United States, the only legal currency, is gold and sil- 
 ver all debts to the Government, and all debts to individuals, being receiv- 
 ed in that medium, and in no other. As, however, the amount of coin requi- 
 site for these purposes would be unmanageable and inconvenient, the United 
 States, like other commercial countries, have adopted the system of making 
 credit supply many of the cases of coin; and numerous banking companies 
 have been established, issuing notes, promising to pay, on demand, gold and 
 silver. The Government of the United States has established one of a simi- 
 lar character; and, for the convenience of the community, the public revenue 
 is collected in gold and silver, the notes of the Bank of the United States, 
 and the notes of such solvent State banks as the Bank of the United States 
 and its branches will receive as cash. 
 
 The currency, therefore, of the United States, in its relation to the Go- 
 vernment of the United States, consists of gold and silver, and of notes equi- 
 valent to gold and silver. And the inquiry which naturally presents itself, is, 
 whether this mixed mass of currency is sound and uniform for all the practi- 
 cal purposes of the Government, and the trade of the Union. That it is so, 
 will appear from the following facts: 
 
 1st. The Government receives its revenue from 
 343 Custom Houses, 
 42 Land Offices, 
 8,004 Post Offices, 
 134 Receivers of Internal Revenue, 
 37 Marshals, 
 33 Clerks of Courts. 
 
 These, with other receiving officers, which need not be specified, compose 
 an aggregate of more than 9 ? 000 persons, dispersed through the whole of the 
 Union, who collect the public revenue. From these persons, the Government 
 has, for the ten years preceding January 1, 1830, received $230,068,855 17. 
 This sum has been collected in every section of this widely extended 
 country. It has been disbursed at other points, many thousand miles distant 
 from the places where it was collected; and yet it has been so collected and 
 distributed, without the loss, as far as the committee can learn, of a single 
 dollar, and without the expense of a single dollar to the Government. That 
 a currency, by which the Government has been [thus enabled to collect and 
 transfer such an amount of revenue to pay its army and navy, and all its ex- 
 
774 BANK OF THE UNITED STATES. 
 
 penses, and the national debt, is unsafe and unsound, cannot readily be be- 
 lieved: for there can be no surer test of its sufficiency, than the simple fact 
 that every dollar, received in the form of a bank note, in the remotest parts 
 of the interior, is, without charge, converted into a silver dollar, at every 
 one of the vast number of places where the service of the Government requires 
 its disbursement. The Secretary of the Treasury, in his report of the 6th of 
 December, 1828, declares, that, during the four years preceding, the receipts 
 of the Government had amounted to more than ninety-seven millions of dol- 
 lars, and that ' 4 all payments on account of the public debt, whether for inter- 
 est or principal; all on account of pensions; all for the civil list; for the army; 
 for the navy; or for whatever purpose wanted, in any part of the Union, have 
 been punctually met." The same officer states, that "it is the preservation 
 of a good currency that can alone impart stability to property, and prevent 
 those fluctuations in its value, hurtful alike to individuals, and to national 
 wealth. This advantage, the bank has secured to the community, by confin- 
 ing within prudent limits its issues of paper, &c. &c. 
 
 3d. If this currency is thus sound and uniforn for the Government, it is not 
 less so to the community. 
 
 The basis of all good currency should be the precious metals, gold and 
 silver; and in a mixed currency of paper circulating with gold or silver, and 
 convertible into it, the great object to be attained is, that the paper should al- 
 ways be equal to gold or silver; that is, it should always be exchangeable for 
 gold or silver. Such a currency is perfect, uniting the convenience of a por- 
 table material with the safety of a metallic medium. Now it cannot be 
 doubted that, throughout this whole country, the circulating bank notes are 
 equal to specie, and convertible into specie. There may be, and probably are 
 exceptions; because, among banks, as among men, there are some who make 
 a show of unreal strength. But it is a fact, so familiar to the experience of 
 every citizen in the community, as to be undeniable, that, in all the Atlantic 
 and commercial cities, and, generally speaking, throughout the whole country, 
 the notes of the State banks are equal to gold or silver. The committee do 
 not mean to say that there may not be too many banks, or that insolvencies 
 do not occasionally occur among them; but, as every bank which desires to 
 maintain its character, must be ready to make settlements with the Bank of 
 the United States, as the agent of the Government, or be immediately dis 
 credited, and must therefore Keep its notes equal to gold or silver, there can 
 be little danger to the community, while the issues of the banks are restrained 
 from running to excess, by the salutary control of the Bank of the United 
 States, whose own circulation is extremely moderate, compared with the 
 amount of its capital. Accordingly, the fact is, that the general credit of the 
 banks is good, and that their paper is always convertible into gold or silver, 
 and for all local purposes forms a local currency equivalent to gold and silver. 
 There is, however, superadded to this currency, a general currency, more 
 known, more trusted, and more valuable, than the local currency, which is 
 employed in the exchanges between different parts of the country. These are 
 the notes of the national bank. These notes are receivable for the Govern- 
 ment, by the 9,000 receivers, scattered throughout every part of the country. 
 They are, in fact, in the course of business, paid in gold or silver, though 
 they are not legally, or necessarily so paid, by the branches of the bank in 
 every section of the Union. In all commercial places they are received, in all 
 transactions, without any reduction in value, and never, under any circum- 
 stances, does the paper, from the remotest branches, vary beyond a quarter 
 of one per cent in its actual exchange for silver. Here, then, is a currency 
 as safe as silver; more convenient, and more valuable than silver; which, 
 through the whole Western and Southern, and interior parts of the Union, is 
 eagerly sought in exchange for silver; which, in those sections, often bears a 
 premium paid in silver; which is, throughout the Union, equal to silver in pay- 
 ment to the Government and payments to individuals in business; and with 
 which, whenever silver is needed, in any part of the country, will command 
 it, without the charge of the slightest fraction of a per centage- By means of 
 
REPORT OF SENATE COMMITTEE, 1830. 
 
 this currency, funds are transmitted at an expense less than in any other 
 country. In no other country can a merchant do what every citizen of the 
 United States can do deposite, for instance, his silver at St. Louis, or Nash- 
 ville, or New Orleans, and receive notes, which he can carry with him 1,000 
 or 1,500 miles, to the Atlantic cities, and there receive for them an equivalent 
 amount of silver, without any expense whatever; and in no possible event, 
 an expense beyond a quarter of one per cent. If, however, a citizen does not 
 wish to incur the anxiety of carrying these notes with him, or to run the ha- 
 zard of the mail, he may, instead of them, receive a draft, payable to himself 
 or his agent alone, so as to ensure the receipt of an equal amount, at an ex- 
 pense ot not one-half, and often not one-fourth, of the actual cost of carrying 
 the silver. The owner of funds, for instance, at St. Louis or Nashville, can 
 transfer them to Philadelphia for one-half per cent.j from New Orleans 
 generally, without any charge at all at most, one-halt per cent.; from Mo- 
 bile, from par to one-half per cent. ; from Savannah, at one-half per cent.; and 
 from Charleston, at from par to one-quarter per cent. 
 
 This seems to present a state of currency approaching as near to perfection 
 as could be desired: for here is a currency issued at twenty-four different 
 parts of the Union, obtainable by any citizen who has money or credit. 
 \Vhen in his possession, it is equivalent to silver in all its dealings with all 
 the 9,000 agents of the Government, throughout the Union. In all his deal- 
 ings with the interior, it is better than silver; in all his dealings with the 
 commercial cities, equal to silver; and if, for any purpose, he desires the sil- 
 ver with which he bought it, it is at his disposal, almost universally, without 
 any diminution, and never more than a diminution of one-quarter per cent. 
 It is not easy to imagine, it is scarcely necessary to desire, any currency 
 better than this. 
 
 It is not among its least advantages, that it bears a proper relation to the 
 real business and exchanges of the country, being issued only to those whose 
 credit entitles them to it, increasing with the wants of the active operations 
 of society, and diminishing, as these subside, into comparative inactivity; 
 while it is the radical vice of all government paper to be issued without re- 
 gard to the business of the community, and to be governed wholly by con- 
 siderations of convenience to the Government. 
 
 After escaping so recently from the degradation of a depreciated paper cur- 
 rency, the committee would abstain from every thing which might, however 
 remotely, revive it. The period is not remote, when, in the language of the 
 late Secretary of the Treasury, the country was oppressed by a '" currency 
 without any basis of coin, or other effective check, and of no value, as a me- 
 dium of remittance or exchange, beyond the jurisdiction of the State whence 
 it had been issued a currency that not unfrequeritly imposed upon the trea- 
 sury the necessity of meeting, by extravagant premiums, the mere act of 
 transferring the revenue, collected at one point, to defray unavoidable expense 
 at another/' It is still within the recollection of the Senate, when, at the seat 
 of Government itself, specie could only be had at twenty or twenty-two per 
 cent, in exchange for the bank paper promises to pay specie; that for bank 
 notes of Baltimore, two per cent, were paid; for those of Philadelphia, six to 
 ssven per cent.; for those of New York, fifteen to sixteen per cent.; and for 
 those of Boston, twenty to twenty-two percent.; ruinous inequalities, which 
 have now happily disappeared. 
 
 3d. The sonudness of the currency may be further-illustrated by the pre- 
 sent condition of the foreign exchanges. 
 
 Exchange on England is, at the present moment, more than one per cent, 
 under par; that is, more than one per cent, in favor of the United States: this 
 being the real fact, disguised by the common forms of quoting exchange on 
 England at between eight and nine per cent, premium. 
 
 It would lead the committee too far from its present purpose to explain that 
 the original estimate of the American dollar, as being worth four shillings and 
 sixpence, and that, therefore, the English pound sterling, is worth $4 44, is 
 wholly erroneous, and occasions a constant misapprehension of the real state 
 
776 BANK OF THE UNITED STATES. 
 
 of our intercourse \yi1h Great Britain. The Spanish dollar has not, fora cen- 
 tury, been worth four and sixpence: the American dollar never was; and 
 whatever artificial value we may assign to our coins, is wholly unavailing to 
 them in the crucibles of London or Paris. According to the latest accounts 
 from London, at the close of December last, the Spanish dollar, instead of 
 being worth four shillings and sixpence, or 54 pence, was worth only 49? 
 pence; the American dollar at least one-fourth per cent, less; so that, to pro- 
 duce one hundred times four and sixpence, it would be necessary to send to 
 England, not 100 dollars, but 109^ Spanish dollars, or 109| of the United 
 States' dollar. If to this be added, the expenses and charges of sending the 
 money, and converting it into English gold, it will cost 111; so that 111 is, at 
 this moment, the real par of exchange between the United States and Eng- 
 land. Ifj therefore, a bill at sight can be procured for less than this sum, or 
 a bill at sixty days for one per cent, less, say HO per cent, it is cheaper than 
 sending silver; that is to say, he who has silver to send to England can pur- 
 chase a bill on London for a greater amount than he would get if he shipped 
 the silver itself, and of course exchange would be in favor of the United 
 States against England. Now, such bills can be bought at a less rate, by 
 more than one per cent, in every city in the United States. 
 
 This fact is conclusive as to the state of the currency. If the bank notes of 
 the country were not equal to specie, specie would be at a premium, which it 
 no where is at present. If the currency were unsound, more must be paid of 
 that currency in order to produce an equal amount of coin in another country, 
 where these bank notes do not circulate. But if, as is the case at present, 
 the bank notes are convertible into specie; if you can buy with bank notes as 
 much as you can buy with silver; and if, in the transactions of the country 
 abroad, the merchants, who, if the notes were not equal to coin, would go to 
 the bank and ship the coin, can pay as much debt in foreign countries with the 
 notes, as by sending the coin, there seems nothing wanting to complete the 
 evidence of the soundness and uniformity of the currency. 
 
 On the whole, the committee are of opinion that the present state of the 
 currency is safe for the community, and eminently useful to the Government; 
 that, for some years past, it has been improving by the infusion into the cir- 
 culating medium of a larger portion of coin, and the substitution of the paper 
 of more solvent banks, in lieu of those of inferior credit; and that, if left to the 
 progress of existing laws and institutions, the partial inconveniences, which 
 still remain, of the paper currency of the last war, will be wholly and insen- 
 sibly remedied. Under these circumstances, they deem it prudent to abstain 
 from all legislation; to abide by the practical good which the country enjoys, 
 and to put nothing to hazard by doubtful experiments. 
 
 The committee submit, for the information of the Senate, certain questions 
 propounded to the President of the Bank of the United States, together with 
 his answers thereto, and a document furnished by that officer, showing the 
 rates of exchange at which drafts are drawn by the Bank of the United 
 States, and its offices of discount and deposite; and ask to be discharged from 
 the further consideration of the subject. 
 
 Questions submitted to the, President of the Bank of the United States , 
 
 with his ansivers. 
 
 Question 1. When the Bank went into operation, was not Philadelphia pa- 
 per ten per cent, worse than Boston, and that much better than Baltimore r 
 
 Answer. Philadelphia paper was 17 per cent, worse than Boston paper; 9 
 to 9j worse than New York paper; 4 5 better than Baltimore. 
 
 Q. 2. Were not the State banks indebted to the Government in large sums, 
 which they could not have paid in sound currency? If so, to what amount? 
 And did not the Bank in many instances assume those debts, and pay them 
 in sound currency, (if so, to what amount?) and indulge those banks until it 
 
REPORT OF SENATE COMMITTEE, 1830. 777 
 
 was convenient for them to pay? and did not the bank lose money by such in- 
 dulgence? 
 
 A. In the years 1817 and 1818, the Government transferred to the bank at 
 Philadelphia, from the State institutions, $7,472,4!9 87, which was cashed, 
 and $3,336,691 67 of special deposite, to be collected by the bank, making 
 $10,809,111 54. The loss sustained by the bank, I cannot estimate. I should 
 willingly compromise for a loss of only $200,000. 
 
 Q. 3. Has the bank at any time oppressed any of the State banks? 
 
 A. Never. There are very few banks which might not have been destroy- 
 ed by an exertion of the power of the bank. None have ever been injured. 
 Many have been saved. And more have been, and are constantly relieved, 
 when it is found that they are solvent, but are suffering under temporary diffi- 
 culty. 
 
 Q. 4. When a State bank becomes indebted to the bank to an improper ex- 
 tent, what course do you pursue? Do you let them go beyond a certain 
 amount? and what is that amount? 
 
 A. The great object is, to keep the State banks within proper limits; to make 
 them shape their business according to their means. For this purpose they 
 are called upon to settle; never forced to pay specie, if it can be avoided, but 
 payment is taken in their bills of exchange, or suffered to lie occasionally until 
 the bank can turn round; no amount of debt is fixed, because the principle we 
 wish to establish is, that every bank should always be ready to provide for its 
 notes. 
 
 Q. 5. If you give drafts on any of the branches, or from one branch on 
 another, or on the mother bank, what is the commission charged? 
 
 A. The charge for drafts is less than the transportation of specie. I send a 
 detailed statement on this point. 
 
 Q. 6. Do you, and at every branch, pay specie on demand? Has there ever 
 been a refusal? 
 
 A. Never. 
 
 Q. 7. Can you state whether specie is more or less abundant in the United 
 States at present, than at any former period? 
 
 A. At the present moment I think specie is more abundant than usual. It 
 comes in as usual. And the state of the exchanges with Europe, is such that 
 it is cheaper to buy bills than to ship coin. The bank had, on the first in- 
 stant, $7,608,000, which is more than it has had for nine years past. 
 
 Q. 8. When the debt is annually paid off to foreigners, do they remit in 
 specie or bills of exchange? Do you supply the means in either way? 
 
 A. When foreigners are paid off, apart is remitted in other stocks, apart 
 goes in bills, a considerable portion of which are bills of the bank. Specie is 
 never resorted to unless the bill market is so high as to make that mode of 
 remittance cheaper. 
 
 Q. 9. Since you commenced the purchase and sale of bills of exchange, has 
 the rate varied; if so, to what extent? 
 
 A. The operations of the bank in exchanges has had the effect of prevent- 
 ing the great fluctuations to which they were-previously Hable. 
 
 Q. 10. W'hatis the reason that exchange on England continues above what 
 was formerly considered the par, that is, the dollar, valued at 4s. 6d. sterling? 
 Is it that the intrinsic value of the dollar has been found to be less than 4s. 
 6c?.? If so, what is that intrinsic value? 
 
 A. The reason is, that we choose to call our dollar 4s. 6d. when it never 
 has been worth four and sixpence, and of course when it goes abroad, it is es- 
 timated not by the name we give it, but according to its real value. 
 
778 BANK OF THE UNITED STATES. 
 
 [For the views of Mr. MADISOK, recently expressed, upon the great constitutional 
 question so frequently discussed in the preceding- pag-es, the reader is referred to 
 the following letters, addressed by this distinguished statesmsan to Mr. IWGERSOLL, 
 of Philadelphia. Their insertion at an earlier period of the work was accidentally 
 omitted. ] 
 
 LETTERS FROM JAMES MADISON TO C. J. INGERSOLL. 
 
 MONTPELIER, February 2, 1831. 
 
 DEAR SIR: I have received your letter of January 21, asking 
 
 1. Is there any State power to make banks? 
 
 2. Is the federal power, as has been exercised, or as proposed to be exer- 
 
 cised by President Jackson, preferable? 
 
 The evil which produced the prohibitory clause in the constitution of the 
 United States, was the practice of the States in making bills of credit, and, 
 in some instances, appraised property, " a legal tender." If the notes of State 
 banks, therefore, whether chartered or unchartered, be made a legal tender, 
 they are prohibited; if not made a legal tender, they dp not fall within the 
 prohibitory clause. The number of the " Federalist" referred to, was written 
 with that view of the subject; and this, with probably Other cotemporary ex- 
 positions, and the uninterrupted practice of the States in creating and permit- 
 ting banks, without making their notes a legal tender, would seem to be a bar 
 to the question, if it were not inexpedient now to agitate it. 
 
 A virtual and incidental enforcement of the depreciated notes of State 
 banks, by their crowding out a sound medium, though a great evil, was not 
 foreseen; and if it had been apprehended, it is questionable whether the con- 
 stitution of the United States, which had so many obstacles to encounter, 
 would have ventured to guard against it by an additional provision. A vir- 
 tual, and, it is hoped, an adequate remedy, may hereafter be found in the 
 refusal of State paper when debased, in any of the federal transactions, and in 
 the control of the federal bank, this being itself controlled from suspending its 
 specie payments by the public authority. 
 
 On tne other question, I readily decide against the project recommended 
 by the President. Reasons more than sufficient appear to have been presented 
 to the public, in the reviews and other comments which it has called forth. 
 How far a hint for it may have been taken from Mr. Jefferson, I know not. 
 The kindred ideas of the latter may be seen in his memoirs, &c- vol. 4, pages 
 196, 207, 526, and in his view of the State banks, vol. 4, pages 199, 220. 
 
 There are sundry statutes of Virginia, prohibiting the circulation of notes 
 payable to bearer, whether issued by individual or unchartered banks. 
 
 These observations, little new or important as they may be, would have 
 been promptly furnished, but for an indisposition in which your letter found 
 me. and which has not yet entirely left me. I hope this will find you in good 
 health, and you have my best wishes for its continuance, and the addition of 
 every other blessing. 
 
 JAMES MADISON. 
 
 CHARLES J. INGERSOLL, Esq. Harrisburg, Pa. 
 
 MONTPELIER, June 25, 1831. 
 
 DEAR SIR: I have received your friendly letter of the 18th inst. The few 
 lines which answered your former one of the 21st of January last, were writ- 
 ten in haste and in bad health: but they expressed, though without the atten- 
 tion in some respects due to the occasion, a dissent from the views of the 
 President, as to a Bank of the United States and a substitute for it; to which 
 
VIEWS OF MR. MADISON, 1831. 779 
 
 1 cannot but adhere. The objections to the latter have appeared tome to 
 predominate greatly over the advantages expected from it, and the constitu- 
 tionality of the former I still regard as sustained by the considerations to which 
 I yielded in giving my assent to the existing bank. 
 
 The charge of inconsistency between my objection to the constitutionality 
 of such a bank, in 1791, and my assent in 1817, turns on the question, how far 
 legislative precedents, expounding the constitution, ought to guide succeeding 
 legislatures, and to overrule individual opinions. 
 
 Some obscurity has been thrown over the question, by confounding it with 
 the respect due from one legislature to laws passed by preceding legislatures. 
 But the two cases are essentially different. A constitution being derived 
 from a superior authority, is to be expounded and obeyed, not controlled or 
 varied by the subordinate authority of a legislature. A law, on the other hand, 
 resting on no higher authority than that possessed by every successive legisla- 
 ture, its expediency as well as its meaning is within the scope of the latter- 
 
 The case in question has its true analogy in the obligation arising from judi- 
 cial expositions of the law on succeeding judges; the constitution being a law 
 to the legislator, as the law is a rule of decision to the judge. 
 
 And why are judicial precedents, when formed on due discussion and con- 
 sideration, and deliberately sanctioned by reviews and repetitions, regarded 
 as of binding influence, or rather of authoritative force, in settling the meaning 
 of a law? It must be answered, 1st, because it is a reasonable and establish- 
 ed axiom, that the good of society requires that the rules of conduct of its 
 members should be certain and known, which would not be the case if any 
 judge, disregarding the decisions of his predecessors, should vary the rule of 
 law according to his individual interpretation of it. Jblisera est servitus ubi 
 Jus est aut vaguin aut incogmlum. 2nd. because an exposition of the law, 
 publicly made, and repeatedly confirmed by the constituted authority, carries 
 with it, by fair inference, the sanction of those who, having made the law 
 through their legislative organ, appear, under such circumstances, to have de- 
 termined its meaning through their judiciary organ. 
 
 Can it be of less consequence that the meaning of a constitution should be 
 fixed and kno\yn, than that the meaning of a law should be so? Can, indeed, 
 a law be fixed in its meaning and operation, unless the constitution be sor 
 On the contrary, if a particular legislature, differing in the construction of the 
 constitution, from a series of preceding constructions, proceed to act on that 
 difference, they not only introduce uncertainty and instability in the consti- 
 tution, but in the laws themselves; inasmuch as all laws preceding the new 
 construction, and inconsistent with it, are not only annulled for the future, but 
 virtually pronounced nullities from the beginning. 
 
 But it is said that the legislator having sworn to support the constitution, 
 must support it in his own construction of it, however different from that put 
 on it by his predecessors, or whatever be the consequences of the construction. 
 And is not the judge under the same oath to support the law? Yet, has it 
 ever been supposed that he was required, or at liberty to disregard all prece- 
 dents, however solemnly repeated and regularly observed; and by giving 
 effect to his own abstract and individual opinions, to disturb the established 
 course of practice in the business of the community? Has the wisest and most 
 conscientious judge ever scrupled to acquiesce in decisions in which he has 
 been overruled by the matured opinions ot the majority of his colleagues; and 
 subsequently to C9nform himself thereto, as to authoritative expositions of 
 the law? And is it not reasonable to suppose that the same view of the offi 
 cial oatii should be taken by a legislature, acting under the constitution^ which 
 is his guide, as is taken by a judge, acting under the law, which is hisr 
 
 There is in fact, and in common understanding, a necessity of regarding a 
 course of practice, as above characterized, in the light of a legal rule of inter- 
 preting a law: and there is a like necessity of considering it a constitutional 
 rule ot interpreting a constitution. 
 
 That there may be extraordinary and peculiar circumstances controlling 
 the rule in both cases, may be admitted; but with such exceptions, the rule 
 
780 BANK OF THE UNITED STATES. 
 
 will force itself on the practical judgment of the most ardent theorist. He will find 
 itimpossible to adhere to, and act officially upon, his solitary opinions as to the 
 meaning of the law or constitution, in opposition to a construction reduced to 
 practice, during a reasonable period of time; more especially where no pros- 
 pect existed of a change of construction by the public or its agents. And if 
 a reasonable period of time, marked with the usual sanctions, would not bar 
 the individual prerogative, there could be no limitation to its exercise, although 
 the danger of error must increase with the increasing oblivion of explanatory 
 circumstances, and with the continual changes in the import of words and 
 phrases. 
 
 Let it then be left to the decision of every intelligent and candid judge, 
 which, on the whole, is most to be relied on, for the true and safe construction 
 of a constitution: that which has the uniform sanction of successive legislative 
 bodies, through a period of years, and under the varied ascendancy of parties; 
 or that which depends upon the opinions of every new legislature, heated as 
 it may be by the spirit of party, eager in the pursuit of some favorite object, 
 or led astray by the eloquence and address of popular statesmen, themselves, 
 perhaps, under the influence of the same misleading causes. 
 
 It was in conformity with the view here taken of the respect due to deliber- 
 ate and reiterated precedents, that the Bank of the United States, though on 
 the original question held to be unconstitutional, received the Executive sig- 
 nature in the year 1817. The act originally establishing a bank had undergone 
 ample discussions in its passage through the several branches of the Govern- 
 ment. It had been carried into execution, throughout a period of twenty years, 
 with annual legislative recognitions; in one instance, indeed, with a positive 
 ramification of it into a new State, and with the entire acquiescense ot all the 
 local authorities, as well as the nation at large; to all of which may be added, 
 a decreasing prospect of any change in the public opinion adverse to the con- 
 stitutionality of such an institution. A veto from the Executive, under these 
 circumstances, with an admission of the expediency and almost necessity of 
 the measure, would have been a defiance of all the obligations derived from a 
 course of precedents amounting to the requisite evidence of the national judg- 
 ment and intention. 
 
 It has been contended that the authority of precedents was in that case in- 
 validated by the consideration that they proved only a respect for the stipulat- 
 ed duration of the bank with a toleration of it until the law should expire, 
 and by the casting vote given in the Senate by the Vice President, in the year 
 1811, against a bill for establishing a national bank, the vote being expressly 
 given on the ground of unconstitutionally. But, if the law itself was unconsti- 
 tutional, the stipulation was void, and could not be constitutionally fulfilled 
 or tolerated. And as to the negative of the Senate, by the casting vote of the 
 presiding officer, it is a tact, well understood at the time, that it resulted not 
 from an equality of opinions in that assembly on the power of Congress to es- 
 tablish a bank, but from a junction of those who admitted the power, but dis- 
 approved the plan, with those who denied the power. On a simple question 
 of constitutionality, there was a decided majority in favor of it. 
 
 JAMES MADISON. 
 
 Mr. INGERSOLL. 
 
JUDICIAL DECISIONS. 
 
 JUDICIAL DECISIONS. 
 
 SUPREME COURT OF THE UNITED STATES. 1819. 
 
 M-CULLOCII, 
 VS 
 
 THE STATK OF 
 
 LLOCH, ) 
 
 IS. > 
 
 MARYLAND, et a/.j 
 
 The following points were decided: 
 
 Congress has power to incorporate a bank. 
 
 The Government of the Union is a Government of the People; it emanates from them; 
 its powers are granted by them; and are to be exercised directly on them, and for 
 their benefit. 
 
 The Government of the Union, though limited in its powers, is supreme within its 
 sphere of action; ?nd its laws, when made in pursuance of the constitution, form 
 the supreme law of the land. 
 
 There is nothing* in the constitution of the United States, similar to the articles of con- 
 federation, which exclude incidental or implied powers. 
 
 If the end be legitimate, and within the scope of the constitution, all the means 
 which are appropriate, which are plainly adapted to that end, and which are not 
 prohibited, may constitutionally be employed to carry it into effect. 
 
 The power of establishing- a corporation is not a distinct sovereign power or end of Go- 
 vernment, but only the means of carrying into effect other powers which are sove- 
 reign. Win never it becomes an appropriate means of exercising- any of the powers 
 given by the constitution to the Government of the Union, it may be exercised by 
 that Government. 
 
 If a certain means to carry into effect any of the powers, expressly given by the con- 
 stitution to the Government of the Union, be an appropriate measure, not prohibited 
 by the constitution, the degree of its necessity is a question of legislative discretion, 
 not of judicial cognizance. 
 
 The act of the 10th April, 1816, c. 44, to " incorporate the subscribers to the Bank of 
 the United States," isalaw made in pursuance of the constitution. 
 
 The Bank of the United States has, constitutionally, aright to establish its branches, 
 or offices of discount and deposite, within any State. 
 
 The State within which such branch may be established, cannot, without violating 
 the constitution, tax that branch. 
 
 The State Governments have no right to tax any of the constitutional means employed 
 by the Government of the Union to execute its constitutional powers. 
 
 The States have no power, by taxation or otherwise, to retard, impede, burden, or in 
 any manner control, the operations of the constitutional laws enacted by Congress, 
 to carry into effect the powers vested in the National Government. 
 
 This principle does not extend to a tax paid by the real property of the Bank of the 
 United States, in common with the other real property in a particular State, nor 
 to a tax imposed on the proprietary interest which the citizens of that State may 
 hold in this institution, in common with other property of the same description 
 throughout the State. 
 
 I 
 
 This was an action of debt, brought by John James, who sued, as well for 
 himself, as for the State of Maryland, in the county court of Baltimore, 
 against the plaintiff in error, M'Culloch, to recover certain penalties imposed 
 by the Legislature of Maryland. By an act of that State it was made penal 
 for any bank, or branch thereof, established without authority of the said 
 State, " to issue notes, in any manner, of any other denomination than five, 
 ten, twenty, fifty, one hundred, five hundred, and one thousand dollars;" 
 
782 BANK OF THE UNITED STATES. 
 
 and such bank, or branch, was further prohibited from issuing notes of these 
 denominations, except upon stamped paper, for which they were to pay to 
 the State treasurer a duty, at certain fixed rates. It was provided, however, 
 that, by the annual payment, in advance, of the sum of fifteen thousand dol- 
 lars, any such bank, or branch, might be relieved from the operation of these 
 restrictions. 
 
 For a violation of the provisions of this act, the officers of the bank were, 
 by the said act, made personally and individually liable to the penalty of five 
 hundred dollars, each: ancj it was to recover this penalty, in a qui tarn action, 
 that this suit was brought. 
 
 The decision having been, in the county court of Baltimore, against the de- 
 fendant M'Culloch, and, also, in the court of appeals of Maryland, the cause 
 was brought, by writ of error, to the Supreme Court of the United States. It 
 was argued for the plaintiff in error by Mr. WEBSTER, Mr. WIRT, Attor- 
 ney General, and Mr. PINKNEY; and, for the defendants, by Mr. MARTIN, 
 Attorney General of Maryland, Mr. HOPKINSON, and Mr. JONES. 
 
 MARCH 7th, 1819. 
 Mr. Chief Justice MARSHALL delivered the opinion of the court. 
 
 In the case now to be determined, the defendant, a sovereign State, denies 
 the obligation of a law, enacted by the Legislature of the Union, and the plain- 
 tiff, on his part, contests the validity of an act which has been passed by the 
 Legislature of that State. The constitution of our country, in its most inter- 
 esting and vital parts, is to be considered; the conflicting powers of the Go- 
 vernment of the Union, and of its members, as marked in that constitution, 
 are to be discussed, and an opinion given, which may essentially influence 
 the great operations of the Government. No tribunal can approach such a 
 question without a deep sense of its importance, and of the awful responsi- 
 bility involved in its decision. But it must be decided peacefully, or remain 
 a source of hostile legislation, perhaps of hostility of a still more serious na- 
 ture; and if it is to be so decided, by this tribunal alone can the decision be 
 made. On the Supreme Court of the United States has the constitution of 
 our country devolved this important duty. 
 
 The first question made in the cause is, has Congress power to incorporate 
 a bank ? 
 
 It has been truly said : that this can scarcely be considered as an open ques- 
 tion, entirely unprejudiced by the former proceedings of the nation respect- 
 ing it. The principle now contested, was introduced at a very early period 
 of our history, has been recognised by many successive Legislatures ? and has 
 been acted upon by the Judicial Department, in cases of peculiar delicacy, as 
 a law of undoubted obligation. 
 
 It will not be denied, that a bold and daring usurpation might be resisted, 
 after an acquiescence still 1 jnger and more complete than this. But it is con- 
 ceived that a doubtful question one on which human reason may pause, and 
 the human judgment be suspended in the decision of which the great princi- 
 ples of liberty are not concerned, but the respective powers of those who arc 
 equally the representatives of the People, are to be adjusted, if not put at 
 rest, by the practice of the Government ? ought to receive a considerable im- 
 pression from that practice. An exposition of the constitution, deliberately 
 established by legislative acts, on the faith of which an immense property has 
 been advanced, ought not to be lightly disregarded. 
 
 The power, now contested, was exercised by the first Congress elected 
 under the present constitution. The bill for incorporating the Bank of the 
 United States did not steal upon an unsuspecting legislature, and pass unob- 
 served. Its principle was completely understood, and was opposed with ecjual 
 zeal and ability. After being resisted, first, in the fair and open field of de- 
 bate, and, afterwards, in the Executive cabinet, with as much persevering 
 talent as any measure has ever experienced, and being supported by argu- 
 ments which convinced minds as pure and as intelligent as this country can 
 
JUDICIAL DECISIONS. 733 
 
 boast, it became a law. The original act was permitted to expire; but a short 
 experience of the embarrassments to which the refusal to revive it exposed 
 the Government, convinced those who were most prejudiced against the mea- 
 sure, of its necessity, and induced the passage of the present Taw. It would 
 require no ordinary share of intrepidity to assert, that a measure adopted un- 
 der these circumstances, was a bold and plain usurpation, to which the con- 
 stitution gave no countenance. 
 
 These observations belong to the cause; but they are not made under the 
 impression that, were the question entirely new, the law would be found 
 irreconcileable with the constitution. 
 
 In discussing this question, the counsel for the State of Maryland have 
 deemed it of some importance, in the construction of the constitution, to con- 
 sider that instrument, not as emanating from the People, but as the act of 
 sovereign anil independent States. The powers of the General Government, 
 it has been said, are delegated by the States, who alone are truly sovereign, 
 and must be exercised in subordination to the States, who alone possess su- 
 preme dominion. 
 
 It would be difficult to sustain this proposition. The convention which 
 framed the constitution was indeed electee! by the State Legislatures. But 
 the instrument, when it came from their hands, was a mere proposal, with- 
 out obligation, or pretensions to it. It was reported to the then existing Con- 
 gress of the United States, with a request that it might " be submitted to a 
 convention of delegates chosen in each State by the People thereof, under the 
 recommendation ot its legislature, for their assent and ratification." This 
 mode of proceeding was adopted; and, by the convention, by Congress, and 
 by the State Legislatures, the instrument was submitted to the People. They 
 acted upon it in the only manner in which they can act safely, effectively, and 
 wiselv, on such a subject, by assembling in convention. It is true, they as- 
 sembled in their several States. And where else should they have assembled ? 
 No political dreamer was ever wild enough to think of breaking down the 
 lines which separate the States, and of compounding the American People into 
 one common mass. Of consequence, when they act, they act in their States. 
 But the measures they adopt do not, on that account, cease to be the mea- 
 sures of the People themselves, or become the measures of the State Govern- 
 ments. 
 
 From these conventions the constitution derives its whole authority. The 
 Government proceeds directly from the People; is " ordained and established" 
 in the name of the People; and is declared to be ordained, " in order to form 
 a more perfect union, establish justice, ensure domestic tranquillity, and se- 
 cure the blessings of liberty to themselves and to their posterity." The assent 
 of the States, in their sovereign capacity, is implied in calling a convention, 
 and thus submitting that instrument to the People. But the People were at 
 perfect liberty to accept or reject it; and their act was final. It required not 
 the affirmance of, and could not be negatived by. the State Governments. The 
 constitution, when thus adopted, was of complete obligation, and bound the 
 State sovereignties. 
 
 It has been said, that the People had already surrendered all their powers 
 to the State sovereignties, and had nothing more to give. But, surely, the 
 question whether they may resume and modify the powers granted to Govern- 
 ment, does not remain to be settled in this country. Much more might the 
 legitimacy of the General Government be doubted, had it been created by the 
 States. The powers delegated to the State sovereignties, were to be exercis- 
 ed by themselves, not by a distinct and independent sovereignty, created by 
 themselves. To the formation of a league, such as was the confederation, the 
 State sovereignties were certainly competent. But when, bt in order to form 
 a more perfect union," it was deemed necessary to change this alliance into 
 an effective government, possessing great and sovereign powers, and acting 
 directly on the People, the necessity of referring it to the People, and of de- 
 riving its powers directly from them, was felt and acknowledged by all. 
 
784 BANK OF THE UNITED STATES. 
 
 The Government of the Union, then, (whatever may be the influence of 
 this fact on the case) is, emphatically and truly, a Government of the Peo- 
 ple. In form, and in substance, it emanates from them. Its powers are grant- 
 ed by them, and are to be exercised directly on them, and for their benefit. 
 
 This Government is acknowledged, by all, to be one of enumerated pow- 
 ers. The principle, that it can exercise only the powers granted to it, would 
 seem too apparent to have required to be enforced by all those arguments 
 which its enlightened friends, while it was depending before the People, found 
 it necessary to urge. That principle is now universally admitted. But the 
 question respecting the extent of the powers actually granted, is perpetually 
 arising, and will, probably, continue to arise, as long as our system shall 
 exist. 
 
 In discussing these questions, the conflicting powers of the General and 
 State Governments must be brought into view, and the supremacy of their 
 respective laws, when they are in opposition, must be settled. 
 
 If any one proposition could command the universal assent of mankind, we 
 might expect it would be this: that the Government of the Union, though 
 limited in its powers, is supreme within its sphere of action. This would 
 seem to result necessarily from its nature. It is the Government of all; ite 
 powers are delegated by all ; it represents all; and acts for all. Though any 
 one State may be willing to control its operations, no State is willing to allow 
 others to control them. The nation, on those subjects on which it can act, 
 must necessarily bind its component parts. But this question is not left to 
 mere reason; the People have, in express terms, decided it, by saying, " this 
 constitution, and the laws of the United States which shall be made in pur- 
 suance thereof," "shall be the supreme law of the land," and by requiring 
 that the members of the State Legislatures, and the officers of the executive 
 and judicial departments of the States, shall take the oath of fidelity to it. 
 
 The Government of the United States, then, though limited in its powers, 
 is supreme; and its laws, when made in pursuance of the constitution, form 
 the supreme law of the land, "any thing in the constitution or laws of any 
 State to the contrary notwithstanding." 
 
 Among the enumerated powers, we do not find that of establishing a bank, 
 or creating a corporation. But there is no phrase in the instrument which, 
 like the articles of confederation, excludes incidental or implied powers, and 
 which requires that every thing granted shall be expressly and minutely de- 
 scribed. Even the tenth amendment, which was framed for the purpose 
 of quieting the excessive jealousies which had been excited, omits the word 
 "expressly," and declares only that the powers "not delegated to the United 
 States, nor prohibited to the States, are reserved to the States, or to the peo- 
 ple;" thus leaving the question, whether the particular power which may be- 
 come the subject of contest, has been delegated to the one Government, or 
 prohibited to the other, to depend on a fair construction of the whole instru- 
 ment. The men who drew and adopted this amendment, had experienced the 
 embarrassments resulting from the insertion of this word in the articles of 
 confederation, and probably omitted it to avoid those embarrassments. A 
 constitution, to contain an accurate detail of all the subdivisions of which its 
 great powers will admit, and of all the means by vvhich they may be carried 
 into execution, would partake of the prolixity of a legal code, and could 
 scarcely be embraced by the human mind. It would, probably, never be un- 
 derstood by the public. Its nature, therefore, requires, that only its great 
 outlines should be marked, its important objects designated, and the minor 
 ingredients which compose those objects be deduced from the nature of the 
 objects themselves. That this idea was entertained by the framers of the 
 American constitution, is not only to be inferred from the nature of the in- 
 strument, but from the language. Why else were some of the limitations, 
 found in the ninth section of the first article, introduced? It is, also, in some 
 degree, warranted by their having omitted to use any restrictive term which 
 might prevent its receiving a fair and just interpretation. In considering this 
 
JUDICIAL DECISIONS 
 
 question, then, \ve must never forget lhat it is a constitution we are ex- 
 pounding* 
 
 Although., among the enumerated powers of Government, we do not find 
 the word " bank," or *' incorporation," we find the great powers to lay and 
 collect taxes; to borrow money; to regulate commerce; to declare and 
 conduct a war; and to raise and support armies and navies. The sword 
 and the purse, all the external relations, and no inconsiderable portion of 
 the industry of the nation, are entrusted to its government. It can 
 never be pretended that these vast powers draw after them others of in- 
 ferior importance, merely because they are inferior* Such an idea can 
 never be advanced. But it may, with great reason, be contended, that 
 a Government, entrusted with such ample powers, on the due execution of 
 which the happiness and prosperity of the nation so vitally depends, must also 
 be entrusted with ample means for their execution. The power being given, 
 it is the interest of the nation to facilitate its execution. It can never be their 
 interest, and cannot be presumed to have been their intention, to clog and 
 embarrass its execution, by withholding the most appropriate means. Through- 
 out this vast republic, from the St. Croix to the Gulf of Mexico, from the At- 
 lantic to the Pacific, revenue is to be collected and expended, armies are to 
 be marched and supported. The exigencies of the nation may require thatthe 
 treasure raised in the north should be transported to the south, that raised in 
 the east conveyed to the west, or that this order should be reversed. Is that 
 construction of the constitution to be preferred, which would render these 
 operations difficult, hazardous, and expensive? Can we adopt that construc- 
 tion, (unless the words imperiously require it) which would impute to the 
 framers of that instrument, when granting these powers for the public good, 
 the intention of impeding their exercise, by withholding a choice of means? 
 If, indeed, such be the mandate of the constitution, we have only to obey; 
 but that instrument does not profess to enumerate the means by which the 
 powers it confers may be executed; nor does it prohibit the creation of a cor- 
 poration, if such a being be essential to the benehcial exercise of those powers. 
 It is, then, the subject of fair inquiry, how tar such means may be employed. 
 
 It is not denied, that the powers given to the Government imply the ordi- 
 nary means of execution. That, for example, of raising revenue, and applying 
 it to national purposes, is admitted to imply the power of conveying money from 
 place to place, as the exigencies of the nation may require, and of employing 
 the usual means of conveyance. But it is denied that the Government has its 
 choice of means; or, that it may employ the most convenient means, if, to em- 
 ploy them, it be necessary to erect a corporation. 
 
 On what foundation does this argument rest? On this alone: The power of 
 creating a corporation is one appertaining to sovereignty, and is not expressly 
 conferred on Congress. This is true; but all legislative powers appertain to so- 
 vereignty. The original power^of giving the law, on any subject whatever, is a 
 sovereign power; and it the Government of the Union is restrained from cre- 
 ating a corporation, as a means for performing its functions, on the single reason 
 that the creation of a corporation is an act of sovereignty; if the sufficiency of 
 this reason be acknowledged, there would be some difficulty in sustaining the 
 authority of Congress to pass other laws for the accomplishment of the same 
 objects. 
 
 'I he Government which has a right to do an act, and has imposed on it the 
 duty of performing that act, must, according to the dictates of reason, be al- 
 lowed to select the means; and those who contend that it may not select any 
 appropriate means, that one particular mode of effecting the object i^e x 
 cepted, take upon themselves the burden of establishing that exception..! 
 
 The creation of a corporation, it is said, appertains to sovereignty, "fhis is 
 admitted. But to what portion of sovereignty does it appertain? Does it be- 
 long to one more than to another? In America, the powers of sovereignty are 
 divided between the Government of the Union, and those of the States. They 
 are each sovereign, with respect to the objects committed to it, and neither 
 sovereign with respect to the objects committed to the other. We cannot 
 99 
 
786 BANK OF THE UNITED STATES. 
 
 comprehend that train of reasoning which would maintain, that the extent of 
 power granted by the People is to be ascertained, not by the nature and terms 
 of the grant, but by its date. Some State constitutions were formed before-, 
 some since that of the United States. We cannot believe that their relation 
 to each other is, in any degree, dependent upon this circumstance. Their 
 respective powers must, we think, be precisely the same as if they had been 
 formed at the same time. Had they been formed at the same time, and had 
 the People conferred on the General Government the power contained in the 
 constitution, and on the States the whole residuum of power, would it have 
 been asserted that the Government of the Union was not sovereign, with re- 
 spect to those objects which were entrusted to it, in relation to which its laws 
 were declared to be supreme? If this could not have been asserted, we can- 
 not well comprehend the process of reasoning which maintains, that a power 
 appertaining to sovereignty cannot be connected with- that vast portion of it 
 which is granted to the General Government, so far as it is calculated to sub- 
 serve the legitimate objects of that Government. The power of creating a 
 corporation, though appertaining to sovereignty, is not, like the power of 
 making war, or levying taxes, or of regulating commerce, a great substantive 
 and independent power, \vhich cannot be implied as incidental to other pow- 
 ers, or used as a means of executing them. It is never the end for which 
 other powers are exercised, but a means by which other objects are accom- 
 plished. No contributions are made to charity for the sake of incorporation, 
 put a corporation is created to administer the charity; no seminary of learning 
 is instituted in order to be incorporated, but the corporate charter is conferred 
 to subserve the purposes of education. No city was ever built with the sole 
 object of being incorporated, but is incorporated as affording the best means of 
 being well governed. The power of creating a corporation is never used for 
 its own sake, but for the purpose of effecting something else. No sufficient 
 reason is, therefore, perceived, why it may not pass as incidental to those 
 powers which are expressly given, if it be a direct mode of executing them. 
 
 But the constitution of the United States has not left the right of Congress 
 to employ the necessary means, for the execution of the power* conferred on 
 the Government, to general reasoning. To its enumeration of powers is 
 added that of making " all laws which shall be necessary and proper for car- 
 rying into execution the foregoing powers, and all other powers vested by this* 
 constitution in the Government ot the United States, or in any department 
 thereof." 
 
 The counsel for the State of Maryland have urged various arguments, to 
 prove that this clause, though in terms of a grant ot power, is not so in effect; 
 out is really restrictive of the general right, which might otherwise be implied, 
 of selecting means for executing the enumerated powers. 
 
 In support of this proposition, they have found it necessary to contend, that 
 this clause was inserted for the purpose of conferring on Congress the power 
 of making laws. That, without it, doubts might be entertained, whether 
 Congress could exercise its powers in the form of legislation. 
 
 But could this be the object for which it was inserted? A government is 
 created by the People, having legislative, executive, and judicial powers. It* 
 legislative powers are vested in a Congress, which is to consist of a Senate 
 and House of Representatives. Each, House may determine the rule of its 
 proceedings; and it is declared that every bill, which shall have passed both 
 Houses, shall, before it becomes a law, be presented to the President of the 
 United States. The 7th section describes the course of proceedings, by which 
 a bill shall become a law; and, then, the 8th section enumerates the powers 
 of Congress. Could it be necessary to say, that a legislature should exercise 
 legislative powers, in the shape of legislation? After allowing each House to 
 prescribe its own course of proceeding, after describing the manner in which 
 a bill should become a law, would it have entered the mind of a single mem- 
 ber of the convention, that an express power to make laws was necessary to' 
 enable the legislature to make them? That a legislature, endowed with legis- 
 lative powers, can legislate, is a proposition too self-evident to have been 
 questioned. 
 
JUDICIAL DECISIONS, 7^7 
 
 But the argument on which most reliance is placed, is drawn from the pe- 
 culiar language of this clause. Congress is not empowered by it to make all 
 laws which may have relation to the powers conferred on the Government, 
 but such only as may be "necessary and proper" for carrying them into exe- 
 cution. The word " necessary''' is considered as controlling the whole sen- 
 tence, and as limiting the right, to pass laws for the execution of the granted 
 powers, to such as arc indispensable, and without which the power would be 
 nugatory. That it excludes the choice of means, and leaves to Congress, in 
 each case, that only which is most direct and simple, 
 
 Is it true, that this is the sense in which the word * 4 necessary" is always 
 used? Does it always import an absolute physical necessity, so strong, that 
 one thing, to which another may be termed necessary, cannot exist without 
 that other? We think it does not. If reference be had to its use, in the 
 common affairs of the world, or in approved authors, we find that it frequently 
 imports no more than that one thing is convenient, or useful, or essential, to 
 another. To employ the means necessary to an end, is generally understood 
 as employing any means calculated to produce the end, and not as being con- 
 fined to those single means, without which the end would be entirely unat- 
 tainable. Such is the character of human language, that no word conveys to 
 the mind, in all situations, one single definite idea; and nothing is more com- 
 mon than to use words in a figurative, sense. Almost all compositions contain 
 words, which, taken in their rigorous sense, would convey a meaning differ- 
 ent from that which is obviously intended. It is essential to just construc- 
 tion, that many words which import something excessive, should be under- 
 stood in a more mitigated sense in that sense which common usage justifies. 
 The word "necessary" is of this description. It has not a fixed character 
 peculiar to itself. It admits of all degrees of comparison: and is often con- 
 nected with other words, which increase or diminish the impression the mind 
 receives of the urgency it imports. A thing may be necessary, very necessa- 
 ry, absolutely or indispensably necessary. ^To no mind would the same idea 
 be conveyed, by these several phrases. This comment on the word is well 
 illustrated by the passage cited at the bar, from the tenth section of the first 
 article of the constitution. It is, we think, impossible to compare the sen- 
 tence which prohibits a State from laying " imposts, or duties on imports or 
 exports, except what may be absolutely necessary for executing its inspection 
 laws," with tnat which authorizes Congress " to make all laws which shall be 
 necessary and proper for carrying into execution" the powers of the General 
 Government, without feeling a conviction that the convention understood 
 itself to change materially the meaning of the word " necessary," by prefix- 
 ing the word "absolutely." This word, then, like others, is used in various 
 senses; and, in its construction, the subject, the context, the intention of the 
 person using them, are all to be taken into view. 
 
 Let this be done in the case under consideration. The subject is the exe- 
 cution of those great powers on which the welfare of a nation essentially de- 
 pends. It must have been the intention of those who gave these powers, to 
 ensure, as far as human prudence could ensure, their beneficial execution. 
 This could not be done by confiding the choice of means to such narrow limits 
 as not to leave it in the power of Congress to adopt any which might be ap- 
 propriate, and which were conducive to the end. This provision is made in 
 a constitution intended to endure for ages to come, and, consequently, to be 
 adapted to the various crises of human affairs. To have prescribed the means 
 by which Government should, in all future time, execute its powers, would 
 have been to change, entirely, the character of the instrument, and give it the 
 properties of a legal code. It would have been an unwise attempt to pro- 
 vide, by immutable rules, for exigencies which, if foreseen at all, must have 
 been seen dimly, arid which can be best provided for as they occur. To have 
 declared that the best means shall not be used, but those alone without which 
 the power given would be nugatory, would have been to deprive the legisla- 
 ture of the capacity to avail itself of experience, to exercise its reason, and to 
 accommodate its legislation to circumstances. If we apply this principle of 
 
733 BANK OF THE UNITED STATES. 
 
 construction to any of the powers of the Government, we shall find it so per- 
 nicious in its operation that we shall be compelled to discard it. The powers 
 vested in Congress may certainly be carried into execution, without pre- 
 scribing an oath of office. The power to exact this security for the faithful 
 performance of duty, is not given, nor is it indispensably necessary. The dif- 
 ferent departments may be established; taxes maybe imposed and collected; 
 armies and navies may be raised and maintained; and money may be borrowed, 
 without requiring an oath of office. It might be argued, with as much plau- 
 sibility as other incidental powers have been assailed, that the convention 
 was not unmindful of this subject. The oath which might be exacted that 
 of fidelity to the constitution is prescribed, and no other can be required. 
 Yet, he would be charged with insanity who should contend, that the Legisla- 
 ture might not superadd, to the oath directed by the constitution, such other 
 oath of office as its wisdom might suggest. 
 
 So, with respect to the whole penal code of the United States: whence 
 arises the power to punish in cases not prescribed by the constitution? All 
 admit that the Government may, legitimately, punish any violation of its 
 laws; and yet, this is not among the enumerated powers of Congress. The 
 right to enforce the observance of law, by punishing its infraction, might be 
 denied with the more plausibility, because it is expressly sjven i n some cases. 
 Congress is empowered "to provide for the punishment of counterfeiting the 
 securities and current coin 01 the United States," and "to define and punish 
 piracies and felonies committed on the high seas, and offences against the law 
 of nations." The several powers of Congress may exist, in a very imperfect 
 state to be sure, but they may exist, and be carried into execution, although 
 no punishment should be inflicted in cases where the right to punish is not ex- 
 pressly given. 
 
 Take, for example, the power "to establish post offices and post roads." 
 This power is executed by the single act of making the establishment. But, 
 from this .has been inferred the power and duty of carrying the mail along the 
 post road, from one post office to another. And, from this implied power, 
 nas again been inferred the right to punish those who steal letters from the 
 post office, or rob the mail. It may be said, with some plausibility, that the 
 right to carry the mail, and to punish those who rob it, is not indispensably 
 necessary to the establishment of a post office and post road. This right is 
 indeed essential to the beneficial exercise of the power, but not indispensably 
 necessary to its existence. So, of the punishment of the crimes of stealing or 
 falsifying a record or process of a court of the United States, or of perjury in 
 such court. To punish these offences is certainly conducive to the due ad- 
 ministration of justice. But courts may exist, and may decide the causes 
 brought before them, though such crimes escape punishment. 
 
 The baneful influence of this narrow construction, on all the operations of 
 the Government, and the absolute impracticability of maintaining it without 
 rendering the Government incompetent to its great objects, might be illustrat- 
 ed by numerous examples, drawn from the constitution, and from our laws. 
 The good sense of the public has pronounced, without hesitation, that the 
 power of punishment appertains to sovereignty, and may be exercised when- 
 ever the sovereign has a right to act, as incidental to his constitutional pow- 
 ers. Ft is a means for carrying into execution all sovereign powers, and may 
 be used, although not indispensably necessary. It is a right incidental to the 
 power, and conducive to its beneficial exercise. 
 
 If this limited construction of the word "necessary" must be abandoned in 
 order to punish, whence is derived the rule which would reinstate it, when 
 
 the infraction of law, why is it not equally comprehensive when required^ to 
 authorize the use of means which facilitate the execution of the powers of Go- 
 vernment, without the infliction of punishment?" 
 
JUDICIAL DECISIONS. 739 
 
 In ascertaining the sense in which the word '* necessary" is used in this 
 clause of the constitution, we may derive some aid from that with which it is 
 associated. Congress shall have power " to make all laws which shall be ne- 
 cessary and proper to carry into execution" the powers of the Government. 
 If the word * fc necessary" was used in that strict and rigorous sense in which 
 the counsel for the State of Maryland contend, it would bean extraordina- 
 ry departure from the usual course of the human mind, as exhibited in com- 
 position, to add a word, the only possible effect of which is to qualify that 
 strict and rigorous meaning; to present to the mind the idea of some choice of 
 means of legislation, not straitened and compressed within the narrow limits 
 for which gentlemen contend. 
 
 But the argument which most conclusively demonstrates the error of the 
 construction contended for by the counsel for the State of Maryland, is found- 
 ed on the intention of the convention, as manifested in the whole clause. To 
 waste time and argument in proving that, without it, Congress might carry its 
 powers into execution, would be not much less idle than to hold a lighted taper 
 to the sun. As little can it be reauired to prove that, in the absence of this 
 clause, Congress w ould have some choice of means. That it might employ those 
 which, in its judgment, would most advantageously effect the object to be ac- 
 complished. That any means adapted to the end, any means which tended 
 directly to the execution of the constitutional powers of the Government, 
 were in themselves constitutional. This clause, as construed by the State of 
 Maryland, would abridge, and almost annihilate, this useful and necessary 
 right of the Legislature to select its means. That this could not be intended, 
 is, we should think, had it not been already controverted, too apparent for 
 controversy. We think so for the following reasons: 
 
 1st. The clause is placed among the powers of Congress, not among the 
 limitations on those powers. 
 
 2d. Its terms purport to enlarge, not to diminish, the powers vested in the 
 Government. It purports to be an additional power, not a restriction on 
 those already granted. No reason has been, or can be assigned, for thus con- 
 cealing an intention to narrow the discretion of the National Legislature, un- 
 der words which purport to enlarge it. The framersof the constitution wish- 
 ed its adoption, arid well knew that it would be endangered by its strength, 
 not by its weakness. Had they been capable of using language which would 
 convey to the eye one idea, and, after deep reflection, impress on the mind 
 another, they would rather have disguised the grant ot power, than its limita- 
 tion. If, then, their intention had been, by this clause, to restrain the free 
 use of means which might otherwise have been implied, that intention would 
 have been inserted in another place, and would have been expressed in terms 
 resembling these: " In carrying into execution the foregoing powers, and all 
 others," &c. 4t no laws shall be passed but such as are necessary and proper." 
 Had the intention been to make this clause restrictive, it would unquestiona- 
 bly have been so in form as well as in effect. 
 
 The result of the most careful and attentive consideration bestowed upon 
 this clause is, that, if it does not enlarge, it cannot be construed to restrain the 
 powers of Congress, or to impair the right of the Legislature to exercise its 
 best judgment in the selection of measures to carry into execution the consti- 
 tutional powers of the Government. If no other motive for its insertion can 
 be suggested, a sufficient one is found in the desire to remove all doubts re- 
 pecting the right to legislate on that vast mass of incidental powers which 
 must be involved in the constitution, if that instrument be not a splendid 
 bauble. 
 
 We admit, as all must admit, that the powers of the Government are limit- 
 ed, and that its limits are not to be transcended. But we think the sound 
 construction of the constitution must allow to the National Legislature that 
 discretion, with respect to the means by which the powers it confers are to be 
 carried into execution, which will enable that body to perform the high duties 
 assigned to it, in the manner most beneficial to the People. Let the end be 
 legitimate; let it be within the scope of the constitution; and all means which 
 
790 BANK OF THE UNITED STATES. 
 
 are appropriate, which are plainly adapted to that end, which are not prohi- 
 bited, but consist with the letter and spirit of the constitution, are constitu- 
 tional. 
 
 That a corporation must be considered as a means not less usual, not of 
 higher dignity, not more requiring a particular specification than other means, 
 has been sufficiently proved. If we look to the origin of corporations, to the 
 manner in which they have been framed in that Government from which we 
 have derived most of our legal principles and ideas, or to the uses to which 
 they have been applied, we find no reason to suppose that a constitution, 
 omitting, and wisely omitting, to enumerate all the means for carrying into 
 execution the great powers vested in Government, ought to have specified 
 this. Had it been intended to grant this power as one which should be dis- 
 tinct and independent, to be exercised in any case whatever, it would have 
 found a place among the enumerated powers of Government. But being con- 
 sidered as a means, to be employed only for the purpose of carrying into exe- 
 cution the given powers, there could be no motive for particularly mention- 
 ing it. 
 
 The propriety of this remark would seem to be generally acknowledged, by 
 the universal acquiescence in the construction which has been uniformly put 
 on the third section of the fourth article of the constitution. The power to 
 44 make all needful rules and regulations respecting the territory, or other 
 property belonging to the United States," is not more comprehensive than 
 the power "to make all laws which shall be necessary and proper for carrying 
 into execution" the powers of the Government. Yet all admit the constitu- 
 tionality of a territorial Government, which is a corporate body. 
 
 If a corporation may be employed indiscriminately with other means to car- 
 ry into execution the powers of the Government, no particular reason can be 
 assigned for excluding the use of a bank, if required for its fiscal operations. 
 To use one, must be within the discretion of Congress, if it be an appropriate 
 mode of executing the powers of Government. That it is a convenient, a 
 useful, and essential instrument in the prosecution of its fiscal operations, is 
 not now a subject of controversy. All those who have been concerned in the 
 administration of our finances, have concurred in representing its importance 
 and necessity; and so strongly have they been felt, that statesmen of the first 
 class, whose previous opinions against it had been confirmed by every circum- 
 stance which can fix the human judgment, have yielded those opinions to the 
 exigencies of the nation. Under the confederation, Congress, justifying the 
 measure by its necessity, transcended, perhaps, its powers to obtain the ad- 
 vantage of a bank; and our own legislation attests the universal conviction of 
 the utility of this measure. The time has passed away when it can be neces- 
 sary to enter into any discussion in order to prove the importance of this in- 
 strument as a means to effect the legitimate objects of the Government. 
 
 But, were its necessity less apparent, none can deny its being an appropri- 
 ate measure; and if it is, the degree of its necessity, as has been very justly 
 observed, is to be discussed in another place. Should Congress, in the exe- 
 cution of its powers, adopt measures which are prohibited by the constitution; 
 or should Congress, under the pretext of executing its powers, pass laws for 
 the accomplishment of objects not entrusted to the Government, it \vould be- 
 come the painful duty of this tribunal, should a case requiring such a decision 
 come before it, to say that such an act was not the law of the land. But where 
 the law is not prohibited, and is really calculated to effect any of the objects 
 entrusted to the Government, to undertake here to inquire into the degree of 
 its necessity, would be to pass the line which circumscribes the judicial de- 
 partment, and to tread on legislative ground. This court disclaims all pre- 
 tensions to such a power. 
 
 After this declaration, it can scarcely be necessary to say, that the exist- 
 ence of State banks can have no possible influence on the question. No trace 
 is to be found in the constitution, of an intention to create a dependence 
 of the Government of the Union on those of the States, for the execution of 
 the great powers assigned to it. Its means are adequate to its ends; and on 
 
 - 
 
JUDICIAL DECISIONS. 
 
 those means alone was it expected to rely for the accomplishment of its ends. 
 To impose on it the necessity of resorting to means which it cannot control, 
 which another government may furnish or withhold, would render its course 
 precarious, the result of its measures uncertain, and create a dependence on 
 other governments, which might disappoint its most important designs, and is 
 incompatible with the language of the constitution. But were it otherwise, 
 the choice of means implies a right to choose a National Bank in preference to 
 State banks, and Congress alone can make the selection. 
 
 After the most deliberate consideration, it is the unanimous and decided 
 opinion of this court, that the act to incorporate the Bank of the United States 
 is a law made in pursuance of the constitution, and is a part of the supreme 
 law of the land. 
 
 The branches proceeding from the same stock, and being conducive to the 
 complete accomplishment of the object, are equally constitutional. It would 
 have been unwise to locate them in the charter, and it would be unnecessarily 
 inconvenient to employ the legislative power in making those subordinate ar- 
 rangements. The great duties of the bank are prescribed; those duties require 
 branches; and the bank itself may, we think, be safely trusted with the selec- 
 tion of places where those branches shall be fixed; reserving always to the 
 Government the right to require that a branch shall be located where it may 
 be deemed necessary. 
 
 It being the opinion of the court, that the act incorporating the bank is con- 
 stitutional; and that the power of establishing a branch in the State of Mary- 
 land, might be properly exercised by the bank itself, we proceed to in- 
 quire 
 
 II. Whether the State of Maryland may, without violating the constitution, 
 tax that branch? 
 
 That the power of taxation is one of v ital importance; that it is retained by 
 the States; that it is not abridged by the grant of a similar power to the Go- 
 vernment of the Union; that it is to be concurrently exercised by the two 
 Governments; are truths which have never been denied. But ? such is the 
 paramount character of the constitution, that its capacity to withdraw any 
 subject from the action of even this power, is admitted. The States are ex- 
 pressly forbidden to lay any duties on imports or exports, except what may 
 be absolutely necessary for executing their inspection laws. If the obligation 
 of this prohibition must be conceded; if it may restrain a State from the ex- 
 ercise of its taxing power on imports and exports; the same paramount cha- 
 racter would seem to restrain, as it certainly may restrain, a State from such 
 other exercise of this power, as is in its nature incompatible with, and repug- 
 nant to, the constitutional laws of the Uuion. A law, absolutely repugnant 
 to another, as entirely repeals that other, as if express terms of repeal were 
 used. 
 
 On this ground, the counsel for the bank place ^its claim to be exempted 
 from the power of a State to tax its operations. There is no express provi- 
 sion for the case, but the claim has been sustained on a principle which so 
 entirely pervades the constitution, is so intermixed with the materials which 
 compose it, so interwoven with its web, so blended with its texture, as to 
 be incapable of being separated from it, without rending it into shreds. 
 
 This great principle is, that the constitution, and the laws made in pursu- 
 ance thereof, are supreme; that they control the constitution and la\vs of the 
 respective States, and cannot be controlled by them. From this, which may 
 be almost termed an axiom, other propositions are deduced as corollaries, on 
 the truth or error of which, and on their application to this case, the cause 
 has been supposed to depend. These are, 1st. That a power to create, im- 
 plies a power to preserve. 3d. That a power to destroy, if wielded by a dif- 
 ferent hand, is hostile to, and incompatible with, these powers to create and 
 to preserve. 3d. That, where this repugnancy exists, that authority which is 
 supreme must control, not yield to that over which it is supreme. 
 
 i'liese propositions, asabstract truths, would, perhaps, never be controverted. 
 Their application to this case, however, has been denied; and, both in main- 
 
792 BANK OF THE UNITED STATES. 
 
 taining the affirmative and the negative, a splendor of eloquence and strength 
 of argument, seldom, if ever, surpassed, have been displayed. 
 
 The power of Congress to create, and of course to continue, the bank, was 
 the subject of the preceding part of this opinion; and is, no longer, to be con- 
 sidered as questionable. 
 
 That the power of taxing it by the States, may be exercised so as to destroy 
 it, is too obvious to be denied. But taxation is said to be an absolute power, 
 which acknowledges no other limits than those expressly prescribed in the 
 constitution, and, like sovereign power of every other description, is trusted 
 to the discretion of those who use it. But the very terms of this argument 
 admit that the sovereignty of the State, in the article of taxation itself, is sub- 
 ordinate to, and may be controlled by, the constitution of the United States. 
 How far it has been controlled by that instrument, must be a question of con- 
 struction. In making this construction, no principle, not declared, can be ad- 
 missible, which would defeat the legitimate operations of a supreme govern- 
 ment. It is of the very essence of supremacy to remove all obstacles to its 
 action within its own sphere, and so to modify every power vested in subor- 
 dinate governments, as to exempt its operations from their own influence. 
 This ettect need not be stated in terms. It is so involved in the declaration 
 of supremacy, so necessarily implied in it, that the expression of it could not 
 make it more certain. We must, therefore, keep it in view while construing 
 the constitution. 
 
 The argument on the part of the State of Maryland is, not that the States 
 may directly resist a law of Congress, but that they may exercise their ac- 
 knowledged powers upon it, and that the constitution leaves them this right 
 in the confidence that they will not abuse it. 
 
 Before we proceed to examine this argument, and to subject it to the test of 
 the constitution, we must be permitted to bestow a fevy considerations on the 
 nature and extent of this original right of taxation, which is acknowledged to 
 remain with the States. It is admitted that the power of taxing the people 
 and their property, is essential to the very existence of government, and may 
 be legitimately exercised on the objects to which it is applicable, to the ut- 
 most extent to which the Government may choose to carry it. The only se- 
 curity against the abuse of this power, is found in the structure of the Govern- 
 ment itself. In imposing a tax, the Legislature acts upon its constituents. 
 This is, in general, a sufficient security against erroneous and oppressive tax- 
 ation. 
 
 The People of a State, therefore, give to their Government a right of taxing 
 themselves and their property, and, as the exigencies of Government cannot 
 be limited, they prescribe no limits to the exercise of this right, resting confi- 
 dently on the interest of the legislator, and on the influence of the constituents 
 over their representative, to guard them against its abuse. But the means 
 employed by the Government of the Union have no such security, nor is the 
 right of a State to tax them sustained by the same theory. Those means are 
 not given by the people of a particular State, not given by the constituents of 
 the legislature which claim the right to tax them, but by the People of all the 
 States. They are given by all, for the benefit of all; and upon theory, should 
 be subjected to that government only which belongs to all. 
 
 It may be objected to this definition, that the power of taxation is not con- 
 fined to the people and property of a State. It may be exercised upon every 
 object brought within its jurisdiction. 
 
 This is true. But to what source do we trace this right? It is obvious, 
 that it is an incident of sovereignty, and is co-extensive with that to which it 
 is an incident. All subjects over which the sovereign power of a State ex- 
 tends, are objects of taxation; but those over which it does not extend, are, 
 upon the soundest principles, exempt from taxation. This proposition may 
 almost be pronounced self-evident. 
 
 The sovereignty of a State extends to every thing which exists by its own 
 authority, or is introduced by its permission; but does it extend to those 
 means which are employed by Congress to carry into execution powers con- 
 
JUDICIAL DECISIONS. 793 
 
 tarred on that body by the People of the United StatesT? We think it demon- 
 strable that it does not. Those powers are not given by the People of a single 
 State, They are given by the People of the United States, to a Government 
 whose laws, made in pursuance of the constitution, are declared to be su- 
 preme. Consequently, the People of a single State cannot confer a sovereign- 
 ty which will extend over them. 
 
 If we measure the power of taxation residing in a State, by the extent of 
 sovereignty which the people of a single State possess, and can confer on its 
 Government, we have an intelligible standard, applicable to every case to 
 which the power may be applied. We have a principle which leaves the 
 power of taxing the People and property of a State unimpaired; which leaves 
 to a State the command of all its resources; and which places beyond its 
 reach, all those powers which are conferred by the People of the United States 
 on the Government of the Union, and all those means which are given for the 
 purpose of carrying those powers into execution. We have a principle which 
 is safe for the States, and safe for the Union. We are relieved, as we ought 
 to be, from clashing sovereignty; from interfering powers; from a repugnancy 
 between a riht in one government to pull down what there is an acknow- 
 ledged right in another to build up; from the incompatibility of a right in one 
 government to destroy what there is a right in another to preserve. We are 
 not driven to the perplexing inquiry, so unfit for the judicial department, what 
 degree of taxation is the legitimate use, and what degree may amount to the 
 abuse of the power. The attempt to use it on the means employed by the Go- 
 vernment ol the Union, in pursuance of the constitution, is itself an abuse, 
 because it is the usurpation of a power which the people of a single State 
 cannot give. 
 
 \Ve find, then, on just theory, a total failure of this original right to tax the 
 means employed by the Government of the Union, for the execution of its 
 powers. The right never existed, and the question whether it has been sur 
 rendered, cannot arise. 
 
 But, waiving this theory for the present, let us resume the inquiry, whether 
 this power can be exercised by the respective States, consistently with a fair 
 construction of the constitution. 
 
 That the power to tax, involves the power to destroy; that the power to 
 destroy, may defeat and render useless the power to create; that there is a 
 plain repugnance in conferring on one government a power to control the 
 constitutional measures of another, which other, with respect to those very 
 measures, is declared to be supreme over that which exerts the control; are 
 propositions not to be denied. But all inconsistencies are to be reconciled 
 by the magic of the word CONFIDENT*:. Taxation, it is said, does not neces- 
 sarily and unavoidably destroy. To cany it to the excess of destruction, 
 would be an abuse, to presume which, would banish that confidence which is 
 essential to all government. 
 
 But is tin's a case of confidence? Would the People of any one State trust 
 those of another with a power to control the most insignificant operations of 
 their State Government? We know they would not. Why, then, should we 
 suppose that the People of any one State should be willing to trust those of 
 another with a power to control the operations of a government to which they 
 have confided their most important and most valuable interests? In the Legis- 
 lature of the Union, alone, are all represented. The Legislature of the Union, 
 alone, therefore, can be trusted by the People with the power of controlling 
 measures which concern all, in the confidence that it will not be abused. 
 This, then, is not a case of confidence, and we must consider it as it really is. 
 If we apply the principle for which the State of Maryland contends, to the 
 constitution generally, we shall find it capable of changing totally the charac- 
 ter of that instrument. We shall find it capable of arresting all the measures 
 of the Government, and of prostrating it at the foot of the States. The Ame- 
 rican People have declared their constitution, and the laws made in pursu- 
 ance thereof, to be supreme; but this principle would transfer the supremacy, 
 in fact, to the States. 
 100 
 
794 BANK OF THE UNITED STATES. 
 
 If the States may tax one instrument, employed by the Government in the ex- 
 ecution of its powers, they may tax any ami every other instrument. They may 
 tax the mail* they may tax the mint; they may tax patent rights; they may tax 
 the papers of the custom house? they may tax judicial process; they may tax ail 
 the means employed by the Government, to an excess which would defeat all 
 the ends of Government. This was not intended by the American People. 
 They did not design to make their Government dependent on the States. 
 
 Gentlemen say, they do not claim the right to extend State taxation to 
 these objects. They limit their pretensions to property. But on what prin- 
 ciple is this distinction made ? Those who make it have furnished no reason 
 for it, and the principle for which they contend denies it. They contend that 
 the power of taxation has no other limit than is found in the 10th section of the 
 1st article of the constitution; that, with respect to every thing else, the pow- 
 er of the States is supreme, and admits of no control. If this be true, the 
 distinction between property and other subjects, to which the power of taxa- 
 tion is applicable, is merely arbitrary, and can never be sustained. This is 
 not all. If the controlling power of the States be established; if their supre- 
 macy, as to taxation, be acknowledged; what is to restrain their exercising 
 this control in any shape they may please togive it ? Their sovereignty is not 
 confined to taxation. That is not the only mode in which it might be display- 
 ed. The question is, in truth, a question of supremacy; and, if the right of the 
 States to tax the means employed by the General Government be conceded, 
 the declaration, that the constitution, and the laws made in pursuance thereof, 
 shall be the supreme law of the land, is empty and unmeaning declamation. 
 
 In the course of the argument, the Federalist has been quoted, and the opi- 
 nions expressed by the authors of that work, have been justly supposed to be 
 entitled to great respect, in expounding the constitution. No tribute can be 
 paid to them which exceeds their merit; but, in applying their opinions to the 
 cases which may arise in the progress of our Government, a right to judge of 
 their correctness must be retained; and, to understand the argument, we must 
 examine the proposition it maintains, and the objections against which it is 
 directed. The subject oi those numbers, from which passages have been cit- 
 ed, is, the unlimited power of taxation which is vested in the General Go- 
 rernment. The objection to this unlimited power, which the argument seeks 
 to remove, is stated with fullness and clearness. It is, " that an indefinite 
 power of taxation in the latter (the Government of the Union) might, and 
 probably would, in time, deprive the former (the Government of the States) 
 of the means of providing for their own necessities, and would subject them 
 entirely to the mercy of the National Legislature. As the laws of the Union 
 are to become the supreme law of the land; as it is to have power to pass all 
 laws that may be necessary for carrying into execution the authorities with 
 which it is proposed to vest it; the National Government might at any time 
 abolish the taxes imposed for State objects, upon the pretence of an interfer- 
 ence with its own. It might allege a necessity for doing this, in order to give 
 efficacy to the national revenues; and thus, all the resources of taxation might, 
 by degrees, become the subjects of federal monopoly,, to the entire exclusion 
 and destruction of the State Governments." 
 
 The objections to the constitution which are noticed in these numbers, were 
 to the undefined power of the Government to tax, not to the incidental privi- 
 lege of exempting its own measures from State taxation. The consequences 
 apprehended from this undefined power were, that it would absorb all the ob- 
 jects of taxation, " to the exclusion and destruction of the State Govern- 
 ments." The arguments of the- Federalist are intended to prove the fallacy 
 of these apprehensions; not to prove that the Government was incapable of 
 executing any of its powers, without exposing the means it employed to the 
 embarrassments of State taxation. Arguments urged against these objections 
 and these apprehensions, are to be understood as relating to the points they 
 mean to prove. Had the authors of those excellent essays been asked, 
 whether they contended for that construction of the constitution, which would 
 place within the reach of the States those measures which the Government 
 
JUDICIAL DECISIONS 795 
 
 might adopt for the execution of its powers, no man, who has read their in- 
 structive pages, will hesitate to admit, that their answer must have been in 
 the negative. 
 
 It has also been insisted, that, as the power of taxation in the General and 
 State Governments is acknowledged to be concurrent, every argument which 
 would sustain the right of the General Government to tax banks chartered by 
 fhe States, will equally sustain the right of the States to tax banks chartered 
 by the General Government. 
 
 But the two cases are not on the same reason. The People of all the States 
 have created the General Government, and have conferred upon it the gene- 
 ral power of taxation. The People of all the States, and the States them- 
 selves, are represented in Congress, and. by their representatives, exercise 
 this power. When they tax the chartered institutions of the States, they tax 
 their constituents; and these taxes must be uniform. But, when a State taxes 
 the operations of the Government of the United States, it acts upon institu- 
 tions created, not by their own constituents, but by people over whom they 
 claim no control. It acts upon the measures of a government created by 
 others, as well as themselves, for the benefit of others, in common with them- 
 selves. The difference is, that which always exists, and always must exist, 
 between the action of the whole on a part, and the action of a part on the 
 whole; between the laws cvf a government declared to be supreme, and those 
 of a government which, when in opposition to those laws, is not supreme. 
 
 But, if the full application of this argument could be admitted, it might 
 bring into question the right ot Congress to tax the State banks, and could not 
 prove the right of the States to tax the Bank of the United States- 
 
 The court has bestovyed on this subject its most deliberate consideration. 
 The result is, a conviction that the States have no power, by taxation or other- 
 wise, to retard, impede, burden, or in any manner control, the operations of 
 the constitutional laws enacted by Congress to cany into execution the pow- 
 ers vested in the General Government. This is, we think, the unavoidable 
 consequence of that supremacy which the constitution has declared. 
 
 We are unanimously of opinion, that the law passed by the Legislature of 
 Maryland, imposing a tax on the Bank of the Lnited States, is unconstitu- 
 tional and void. 
 
 This opinion does not deprive the States of any resources which they origi- 
 nal Iv possessed. It does not extend to a tax paid by the real property of the 
 bank, in common with the other real property within the State, nor to a tax 
 imposed on the interest which the citizens of Maryland may hold in this in- 
 stitution, in common with other property of the same description throughout 
 the State. But this is a tax on the operations of the bank, and is, conse- 
 quently, a tax on the operation of an instrument employed by the Govern- 
 ment of the Union to carry its powers into execution. Such a tax must be 
 unconstitutional. 
 
 JUDGMENT. This cause came on to be heard on the transcript of the record 
 of the court of appeals of the State of Maryland, and was argued by counsel. 
 On consideratiou whereof, it is the opinion of this court, that the act of the 
 Legislature of Maryland is contrary to the constitution of the United States, 
 and void; and, therefore, that the said court of appeals of the State of Mary- 
 land erred in affirming the judgment of the Baltimore county court, in which, 
 judgment was rendered against James W. M'Culloch; but, that the said court 
 of appeals of Maryland ought to have reversed the said judgment of the said 
 Baltimore county court, and ought to have given judgment for the said appel- 
 lant, M'Culloch. It is, therefore, adjudged and ordered, that the said judg- 
 ment of the said court of appeals of the State of Maryland, in this case, be, 
 and the same hereby is, reversed and annulled. And this court, proceeding 
 to render such judgment as the said court of appeals should have rendered, it 
 is further adjudged and ordered, that the judgment of the said Baltimore 
 county court be reversed and annulled, and that judgment be entered in the 
 said Baltimore county court for the said James W. M'Culloch. 
 
79G BANK OF THE UNITED STATES. 
 
 Osborn and others, 
 
 vs. 
 
 The President, Directors, and Company, of the Bank of the United States, 
 
 Respondents. 
 
 [9th Wheaton, 738. 
 
 [It was the intention of the editors to have given, at length, the opinion of the learn- 
 ed judge, (Marshall) pronounced in this case, but, its great length, forbids. A brief 
 summary of the case, and of the points decided, is all that can be attempted,- the lat- 
 ter will be given in the words of the reporter.] 
 
 On the 8th of February, 1819, the Legislature of Ohio passed an act, enti- 
 tled "An act to levy and collect a tax from all banks and individuals, and 
 companies, and associations of individuals, that may transact banking busi- 
 ness, in this State, without being authorized to do so, by the laws thereof." 
 The penalty assigned, for a violation of this act, was fifty thousand dollars on 
 each office of discount and deposite. On the 17th of September, 1819, Os- 
 born, one of the appellants, who was auditor of the State, caused the office of 
 the United States' Bank, at Chillicothe, to be entered, and, under color of 
 executing the said law, violently took therefrom, in specie and bank notes. 
 To restrain the said Osborn from proceeding farther, in the execution of the 
 said law, and to obtain a restitution of the said sum, a bill in equity, with prayer 
 for an injunction, was [.filed in the Circuit Court of Ohio. The injunction 
 was granted, and, upon the hearing of the cause, a decree was passed, order- 
 ing a restitution of the money; from this decree an appeal was taken to the 
 Supreme Court of the United States, in which court the following points were 
 decided: 
 
 The act of incorporation of the Bank of the United States gives the circuit courts 
 of the United States jurisdiction of suits by and against the bank. 
 
 This provision in the charter is warranted by the 3d article of the constitution, 
 which declares that ** the judicial power shall extend to all cases, in law and equity, 
 arising under this constitution, the laws of the United States, and treaties made, or 
 which shall be made, under their authority.'* 
 
 It is unnecessary for an attorney or solicitor, who prosecutes a suit for the Bank of 
 the United States, or other corporation, to produce a warrant of attorney under the 
 corporate seal. 
 
 Whatever authority may be necessary for an attorney or solicitor to appear for a 
 natural or artificial person, it is not a ground of reversal for error, in an appellate 
 court, that such authority does not appear on the face of the record. It is a formal 
 defect, which is cured by the statute of jeofails, and the 32d section of the judiciary 
 act of 1789, ch. 20. 
 
 In general, the answer of one defendant, in equity, cannot be read in evidence 
 against another. But where one defendant succeeds to another, so that the right of 
 the one devolves on the other, and they become privies in estate, the rule does not 
 apply, j. 
 
 Where the defendant is restrained by an injunction, from using money in his pos- 
 session, interest will not be decreed against him. 
 
 An injunction will be granted to prevent the franchise of a corporation from being 
 destroyed, as well as to restrain a party from violating it, by attempting to participate 
 in its exclusive privileges. 
 
 In general, an injunction will not be allowed, nor a decree rendered, against an 
 agent, where the principal is not made a party to the suit. But, if the principal be not 
 himself subject to the jurisdiction of the court, (as in the case of a sovereign State) 
 the rule may be dispensed with. 
 
 A court of equity will interpose by injunction to prevent the transfer of a specific 
 thing, which, if transferred, will be irretrievably lost to the owner, such as negotiable 
 securities and stocks. 
 
JUDICIAL DECISIONS. 797 
 
 The circuit courts of the United States have jurisdiction of a bill brought by the 
 Bank of the United States, for the purpose of protecting- the bank in the exercise of 
 its franchises, which are threatened to be invaded, under the unconstitutional laws of 
 a State 5 and, as the State itself cannot, according- to the llth amendment of the con- 
 stitution, be made a party defendant to the suit, it may be maintained against the offi- 
 cers and agents of the State, who are entrusted with the execution of such laws. 
 
 A State cannot tax the Bank of the United States? and any attempt, on the part of 
 its agents and officers, to enforce the collection of such tax against the property of the 
 bank, may be restrained by injunction from the Circuit Court. 
 
 The following points have also been decided by the Supreme Court in re- 
 gard to the Bank of the United States, its powers and liabilities, in the re- 
 spective cases referred to: 
 
 The act of April 10, 1816, c. 44, (6 L. U. S. 35) incorporating the Bank of the 
 United States, does not, by the ninth rule of the fundamental articles, prohibit the 
 bank from discounting promissory notes, or receiving a transfer of notes in payment 
 of a debt due to the bank. Fleckner v. Sank of United States, 8 Wheat. 338. 
 
 The Bank of the United States, and every other bank not restricted by its charter, 
 and also private bankers, on 'discounting notes and bills, have a right to deduct the 
 legal interest from the amount of the note or bill, at the time it is discounted. Ibid. 
 
 The statute incorporating the Bank of the United States does not avoid securities 
 on which usurious interest may have been taken, and the usury cannot be set up as a 
 defence to a note on which it is taken. It is merely a violation of the charter, for 
 which a remedy may be applied by the Government. Ibid. 
 
 The circuit courts of the United States have jurisdiction of suits brought by the 
 Bank of the United States against a bank incorporated by a statute of a State, and of 
 which the State is itself a stockholder, together with private individuals who are citi- 
 zens of the same State with some of the stockholders of the Bank of the United States. 
 Bank of United States v. Planters' Bank of Georgia, 9 Wheat. 104. 
 
 The Bank of the United States may sue in the Circuit Courts as endorsee or bearer 
 of a promissory note, although the original payee or endorser could not sue in those 
 courts, being a citizen of the same State with defendant; such a case is not within the 
 llth section of the judiciary act of September 24, 1789, c. 20, (2 Bior. 56,) which was 
 merely a limitation on the jurisdiction conferred by that act. Ibid, 
 
 In a suit brought by the Bank of the United States upon a bond given to the bank 
 to secure the faithful performance of the official duties of a cashier, evidence of the 
 execution of the bond, and of its approval by the board of directors, (according to the 
 rules and regulations contained in'the charter of the bank) is admissible, notwithstand- 
 ing there was no record of such approval, and the plaintiff may prove the fact of such 
 approval by the board, by presumptive evidence, in the same manner as such fact 
 might be proved in the case of private persons, not acting as a corporation or as the 
 agents of a corporation. Bank of United States v. Dandrige et al. 12 Wheat. 64. 
 
 Where, in such case, the cashier is duly appointed and permitted to act in his office 
 for a long time, under the sanction of the directors, it is not necessary that his official 
 bond should be accepted by the board of directors as satisfactory, according to the 
 terms of the charter, in order to enable him to enter legally on the duties of his office, 
 or to make his securities responsible for the non-performance of those duties; the char- 
 ter and by-laws are to be considered in this respect as directory to the board, and not 
 as conditions precedent. Ibid. 
 
APPENDIX. 
 
 BY the original plan of the present work, the editors did not design taextend 
 their researches, in point of time, beyond the 10th of April, 1816, when the 
 i'xi>ting charter of tha United States' Bank was approved. To that period 
 they have endeavored, in the body of the work, to give the entire proceedings 
 and debates of Congress, as minutely as their sources of information would 
 permit. 
 
 Without professing to aim at the same accuracy of detail, in regard to sub- 
 sequent proceedings, they insetted such of them as seemed most prominent 
 and important; such as the report of the committee specially appointed to 
 examine the books of ihe bank at Philadelphia, and the two reports on the 
 currency, made in the year 1830, Sic. With a view, however, to render the 
 work more complete, and more permanently useful, the editors have thought 
 it advisable to insert, in an appendix, such other proceedings of Congress, 
 .since the enactment- of the charier, as seemed to indicate the views of that 
 body, in regard to the character and operations of the institution. The charter 
 though diffused as widely us the laws of the Union, is also inserted. 
 
CONTENTS OF THE APPENDIX 
 
 Sank Charter of 1816, - - 801-811 
 
 Memorial, by the Bank, presented, 811 
 
 Sill, in the House, to amend the charter, 812 
 
 Sill, in the Senate, 812 
 Report, of Committee of Ways and Means, on the power of the Bank to 
 
 receive public debt in pledge for loans of money, &c. 813 
 Resolution, (Mr. Spencer's) as amended, for an examination of bank 
 
 books, &c. - 813 
 Bill, reported by Mr. Spencer to regulate the right of voting 1 foy direc- 
 tors, - . 814 
 Memorials in favor of the Bank, presented, from Boston and New York, 814-815 
 Act, regulating the right of voting for directors, &c. ... 815-816 
 Resolution, by Mr. Spencer, asking information as to the state of the bank, 
 
 1st March, 1819, 817 
 
 Memorial, by the bank, soliciting amendments to its charter, - 817 
 Sill, in Senate, to authorize the appointment of an agent and register to 
 
 sign bills and notes, - 820 
 Mr. Smith, of South Carolina, calls for information, in regard to frauds by 
 
 officers of the bank, &c. 822 
 
 Ohio Proceedings, in regard to the bank, 822 
 
 Resolution, by Mr. Colden, respecting usury, - 823 
 
 Report, on the subject of usury by the bank, - - 823 
 Mr. A. Smith's resolution for limiting the issue of notes by the bank, in 
 
 proportion to the amount of specie, - 823 
 On the tenure of offices by directors, &c. - 824-825 
 
 Charleston Memorial, respecting the bank, 825 
 
 Report of Committee, upon that, and the bank memorial, 826 
 Mr. P. P. Sarbour's resolution, for the sale of bank stock held by the 
 
 United States, - - 831 
 
 Renewal of charter 0/1816, application for, and bill, - 832 
 
CHARTER OF 1816. 
 
 vi?n act to incorporate the subscribers to the Bank of the United States, 
 
 A Bank of the United States, with a capital of 35,000,000. 
 Be it enacted by the Senate, and Howe of Representatives of the United 
 Slates of America in Congress assembled, That a Bank of the United States 
 of America shall be established, with a capital of thirty five millions of dol- 
 lars, divided into three hundred and fifty thousand shares, of one hundred 
 dollars each share. Seventy thousand shares, amounting to the sum of seven 
 millions of dollars, part of the capital of the said bank, shall be subscribed 
 and paid for by the United States, in the manner hereinafter specified; and 
 two hundred and eighty thousand shares, amounting to the sum of twenty- 
 eight millions of dollars, shall be subscribed and paid for by individuals, com- 
 panies, or corporations, in the manner hereinafter specified. 
 
 Places, &c. for receiving subscriptions. 
 
 SEC. 2. tfndbc.it further enacted, That subscriptions for the sum of twenty- 
 eight millions of dollars, towards constituting the capital of the said bank, 
 shall be opened on the first Monday in July next, at the following places, 
 that is to say: at Portland, in the District of Maine; at Portsmouth, in the 
 State of New Hampshire; at Boston, in the State of Massachusetts; at Provi- 
 dence, in the State of Rhode Island; at Middletown, in the State of Connec- 
 ticut; at Burlington, in the State of Vermont; at New York, in the State of 
 New York; at New Brunswick, in the State of New Jersey; at Philadelphia, 
 in the State of Pennsylvania; at Wilmington, in the State of Delaware; at 
 Baltimore, in the State of Maryland; at Richmond, in the State of Virginia; 
 at Lexington, in the State of Kentucky; at Cincinnati, in the State of Ohio; 
 at Raleigh, in the State of North Carolina; at Nashville, in the State of Ten* 
 nessee; at Charleston, in the State of South Carolina; at Augusta, in the 
 State of Georgia; at Ne\v Orleans, in the State of Louisiana; and at Wash- 
 ington, in the District of Columbia. And the said subscriptions shall be 
 opened under the superintendence of five commissioners at Philadelphia, and 
 of three commissioners at each of the other places aforesaid, to be appointed 
 by the President of the United States, who is hereby authorized to make 
 such appointments, and shall continue open every day, from the time of open-- 
 ing the same, between the hours of ten o'clock in the forenoon and four 
 o'clock in the afternoon, for the term of twenty days, exclusive of Sundays, 
 when the same shall be closed, and immediately thereafter the commissioners, 
 or any two of them, at the respective places aforesaid, shall cause two tran- 
 scripts or copies of such subscriptions to be made, one of which they shall 
 send to the Secretary of the Treasury, one they shall retain, and the original 
 they shall transmit, within seven days from the closing of the subscriptions as 
 aforesaid, to the commissioners at Philadelphia aforesaid. And on the receipt 
 of the said original subscriptions, or of either of the said copies thereof, if the 
 original be lost, mislaid, or detained, the commissioners at Philadelphia 
 aforesaid, or a majority of them, shall immediately thereafter convene, and 
 proceed to take an account of the said subscriptions. And if more than the 
 amount of twenty-eight millions of dollars shall have been subscribed, then 
 the said last mentioned commissioners shall deduct the amount of such excess 
 from the largest subscriptions, in such manner as that no subscription shall be 
 reduced in amount, while any one remains larger: Provided, That, if the 
 subscriptions taken at either of the places aforesaid shall not exceed three 
 thousand shares, there shall be no reduction of such subscriptions, nor shall, 
 in any case, the subscriptions taken at either of the places aforesaid, be re- 
 duced below that amount. And in case the aggregate amount of the said sub- 
 scriptions shall exceed twenty-eight millions ofuollars, the said last mentioned 
 commissioners, after having apportioned the same as aforesaid, shall cause 
 lists of the said apportioned subscriptions to be made out. including, in each 
 
802 APPENDIX. 
 
 list the apportioned subscription for the place where the original subscription 
 was made, one of which lists they shall transmit to the commissioners, or one 
 of them, under whose superintendence such subscriptions were originally 
 made, that the subscribers may thereby ascertain the number of shares to 
 them respectively apportioned us aforesaid. And in case the aggregate amount 
 of the said subscriptions, made during (he period aforesaid, at alt the places 
 aforesaid, shall not amount to twenty-eight millions of dollars, the subscrip- 
 tions to complete the said sum shall be and remain open at Philadelphia afore- 
 said, under the superintendence of the commissioners appointed for that 
 place; and the subscriptions may be then made by any individual, company, 
 or corporation, for any number of shares, not exceeding, in the whole, the 
 amount required to complete the said sum of twenty-eight millions of dollars. 
 
 Regulations concerning- subscriptions, and payments on them, &c. 
 
 SEC. SK Jind be it further enacted. That it shall be lawful for any individual, 
 company, corporation, or State, when the subscriptions shall be opened as 
 herein before directed, to subscribe for any number of shares of the capital of 
 the said bank, not exceeding three thousand shares, arid the sums so subscribed 
 shall be payable, and paid, in the manner following, that is to say: seven mil- 
 lions of dollars thereof in gold or silver coin of the United States, or in gold 
 coin of Spain, or the dominions of Spain, at the rate of one hundred cents for 
 every twenty-eight grains and sixty -hundredths of a grain of the actual weight 
 thereof, or in other foreign gold or silver coin, at the several rates prescribed 
 by the first section of an act regulating the currency of foreign coins in the 
 United States, passed tenth day of April, one thousand eight hundred and 
 six, and twenty-one millions of dollars thereof in like gold or silver coin, 
 or in the funded debt of the United States, contracted at the time of the sub- 
 scriptions, respectively. And the payments made in the funded debt of the 
 United States, shall be paid and received at the following rates, that is to sav: 
 the funded debt bearing an interest of six per centum per annum, at the 
 nominal or par value thereof; the funded debt bearing an interest of three per 
 centum per annum, at the rate of sixty-five dollars for every sum of one hun- 
 dred dollars of the nominal amount thereof; and the funded debt bearing an 
 interest of seven per centum per annum, at the rate of one hundred and six 
 dollars and fifty-one cents, for every sum of one hundred dollars of the nomi- 
 nal amount thereof; together with the amount of the interest accrued on the 
 said several denominations of funded debt; to be computed and allowed to 
 the time of subscribing the same to the capital of the said bank as aforesaid. 
 And the payments of the said subscriptions shall be made and completed by 
 the subscribers, respectively, at the times, and in the manner following, that 
 is to say: at the time of subscribing there shall be paid five dollars on each 
 share, in gold or silver coin as aforesaid, and twenty -five dollars more in coin 
 as aforesaid, or in funded debt as aforesaid; at the expiration of six calendar 
 months after the time of subscribing, there shall be paid the further sum of 
 ten dollars on each share, in gold or silver coins, as aforesaid, and twenty - 
 five dollars more in coin as aforesaic 1 , or in funded debt as aforesaid; at 
 the expiration of tvyelve calendar months from the time of subscribing, there 
 shall be paid the further sum of ten dollars on each share, in gold or silver 
 coin as aforesaid, and twenty-five dollars more in coin as aforesaid, or in 
 funded debt as aforesaid. 
 
 SEC. 4. And be it further enacted, That, at the time of subscribing to the 
 capital of the said bank as aforesaid, each and every subscriber shall deliver 
 to the commissioners, at the place of subscribing, as well the amount of their 
 subscriptions, respectively, in coin as aforesaid, as the certificates of funded 
 debt, for the funded debt proportions of their respective subscriptions, together 
 with a power of attorney, authorizing the said commmissioners, or a majority 
 of them, to transfer the said stock, indue form of law-, ta"the president, 
 directors, and company, of the Bank of the United States," as soon as the 
 said bank shall be organized: Provided, always, That if, in consequence of 
 the apportionment of the shares in the capital of the said bank among the sub- 
 
CHARTER OF 1816. 303 
 
 scribers. in the case, and in the manner herein before provided, any subscri- 
 ber shall have delivered to the commissioners, at the time of subscribing, a 
 greater amount of gold or silver coin and funded debt than shall be .necessary 
 to complete the payments for the share or shares to such subscribers, appor- 
 tioned as aforesaid, the commissioners shall only retain so much of the said 
 gold or silver coin and funded debt as shall be necesssary to complete 
 such payments, and shall, forthwith, return the surplus thereof, on appli- 
 cation for the same to the subscribers lawfully entitled thereto. And the 
 commissioners, respectively, shall deposite the gold and silver coin, and cer- 
 tificates of public aebt, by them respectively; received as aforesaid, from the 
 subscribers to the capital of the said bunk, in rsome place of secure and safe 
 keeping, so that the same may and shall be specifically delivered and trans- 
 ferred, as the same were by them respectively received, to the president, 
 directors, and company, of the Bank of the United States, or to their order, 
 as soon as shall be required after the organization of the said bank. Ana 
 the said commissioners appointed to superintend the subscriptions to the 
 capital of the said bank as aforesaid, shall receive a reasonable compensation 
 for their services, respectively, and shall be allowed all reasonable charges 
 and expenses incurred in the execution of their trust, to be paid by the presi- 
 dent, directors, and company, of the bank, out of the funds thereof. 
 
 The United States may redeem the funded debt, &c. and the bank may sell for gold 
 
 ami silver, &c. 
 
 SEC. 5. Jlml be it further enacted, That it shall be lawful for the United 
 States to pay and redeem the funded debt subscribed to the capital of the 
 said bank, at the rates aforesaid, in such sums, and at such times, as shall be 
 deemed expedient, any thing in any act or acts of Congress to the contrary 
 thereof notwithstanding. And it shall also be lawful for the president, di- 
 rectors, and company, of the said bank, to sell and transfer, for gold and silver 
 coin, or bullion, the funded debt subscribed to the capital of the said bank as 
 aforesaid: Provided, always, That they shall not sell more thereof than the 
 sum of two millions of dollars in any one year; nor sell any part thereof at 
 any tinie, within the United States, without previously giving notice of their 
 intention to the Secretary of tin/ Treasury, and offering the same to the 
 United States for the period of fifteen days, at least, at the current price, not 
 exceeding the rates aforesaid. 
 
 The Secretary of the Treasury to subscribe on behalf of the United Slates, &.c. 
 
 SEC. G. And be it further enacted, That, at the opening of subscription to 
 the capital stock of the said bank, the Secreiary ot the Treasury shall sub- 
 scribe, or cause to be subscribed, on behalf of the United States, the said 
 number of seventy thousand shares, amounting to seven millions of dollars as 
 aforesaid, to be paid in gold or silver coin, or in stock of the United States, 
 bearing interest at the rate of five per centum per annum; and if payment 
 thereof, or of any part thereof, be made in public stock, bearing interest as 
 aforesaid, the said interest shall be payable quarterly, to commence from the 
 time of making such payment on account of the said subscription, and the 
 principal of the said stock shall be redeemable in any sums, and at any pe- 
 riods, which the Government shall deem fir. And the Secretary of the Trea- 
 sury shall cause the certificates of such public stock to be prepared, and made 
 in the usual form, and shall pay and deliver the same to the president, direc- 
 tors, and company, of the said bank, on the first day of January, one thousand 
 eight hundred and seventeen, which said stock it shall be lawful for the said 
 president, directors, and company, to sell and transfer for gold and silver 
 coin or bullion, at their discretion: Provided, They shall not sell more than 
 two millions of dollars thereof in any one year. 
 
 The subscribers to the bank incorporated, Sec. their name and style. 
 SEC. 7. find be it further enacted, That the subscribers to the said Bank of 
 
8,04 APPENDIX. 
 
 the United States of America, their successors and assigns, shall be, and are 
 hereby, created a corporation and body politic, by the name and style of 
 44 The president, directors, and company, of the Bank of the United States," 
 and shall so continue until the third day of March, in the year one thousand 
 eight hundred and thirty-six, and by that name shall be, and are hereby, made 
 able and capable, in Law, to have, purchase, receive, possess, enjoy, and re- 
 tain, to them and their successors, lands, rents, tenements, hereditaments, 
 goods, chattels, and effects, of whatsoever kind, nature, and quality, to an 
 amount not exceeding, in the whole, fifty-five millions of dollars, including 
 the amount of the capital stock aforesaid; and the same to sell, grant, demise, 
 alien or dispose of; to sue and be sued, plead and be impleaded, answer and 
 be answered, defend and be defended, in all State courts having competent 
 jurisdiction, and in any circuit court of the United States: and also to make, 
 have, and use, a common seal, and the same to break, alter, and renew, at 
 their pleasure; and also to ordain, establish, and put in execution, such by- 
 laws, and ordinances, and regulations, as they shall deem necessary and con- 
 venient for the government ot the said corporation, not being contrary to the 
 constitution thereof, or to the laws of the United States; and generally to do 
 and execute all and singular the acts, matters, and things, which to them it 
 shall or may appertain to do; subject, nevertheless, to the rules, regulations, 
 restrictions, limitations, and provisions, hereinafter prescribed and declared. 
 
 Twenty -five directors five to be appointed by the President, &c. 
 
 SEC. 8. Jlnd be it further enacted, That, for the management of the affairs 
 of the said corporation, there shall be twenty -five directors, five of whom, 
 being stockholders, shall be annually appointed by the President of the Unit- 
 ed States, by, and with, the advice and consent of the Senate, not more than 
 three of whom shall be residents of any one State; and twenty of whom shall 
 be annually elected at the banking house in the city of Philadelphia, on the 
 first Monday of January, in each year, by the qualified stockholders of the 
 capital of the said bank, other than the United States, and by a plurality of 
 votes then and there actually given, according to the scale of voting herein- 
 after prescribed: Provided, always, That no person, being a director in the 
 Bank of the United States, or any of its branches, shall be a director of any 
 other bank; and should any such director act as a director in any other 
 bank, it shall forthwith vacate his appointment in the direction of the Bank 
 of the United States. And the directors, so duly appointed and elected, 
 shall be capable of serving, by virtue of such appointment and choice, from 
 the first Monday in the month of January of each year, until the end and ex- 
 piration of the first Monday in the month of January of the year next ensuing 
 the time of each annual election to be held by the stockholders as aforesaid. 
 And the Board of Directors, annually, at their first meeting after their elec- 
 tion in each and every year, shall proceed to elect one of the directors to be 
 president of the corporation, who shall hold the said office during the same 
 period for which the directors are appointed and elected as aforesaid: Pro- 
 vided, also, That the first appointment and election of the directors and pre- 
 sident of the said bank shall be at the time and for the period hereinafter 
 declared: Jlnd provided, also, That, in case it should at any time happen that 
 an appointment or election of directors, or an election of the president of the 
 said bank, should not be so made as to take effect on any day when, in pur- 
 suance of this act, they ought to take effect, the said corporation shall not, 
 for that cause, be deemed to be dissolved; but it shall be lawful at any other 
 time to make such appointments, and to hold such elections, (as the case 
 may be) and the manner of holding the elections shall be regulated by the 
 by-laws and ordinances of the said corporation: and until such appointments 
 or elections be made, the directors and president of the said bank, for the 
 time being, shall continue in office: Jlnd provided, also, That in case of the 
 death, resignation, or removal, of the president of the said corporation, the 
 directors shall proceed to elect another president from the directors as afore- 
 said ; and in case of the death, resignation, or absence from the United 
 
CHARTER OF 1816. 
 
 States, or removal of a director from office, the vacancy shall be supplied by 
 the President of the United States, or by the stockholders, as the case may 
 be. But the President of the United States alone shall have power to remove 
 any of the directors appointed by him as aforesaid. 
 
 Manner and time of the bank's going 1 into operation, 8tc. 
 
 SEC. 9. Jindbe it further enacted, That, as soon as the sum of eight millions 
 four hundred thousand dollars, in gold and silver coin and in the public debt, 
 shall have been actually received on account of the subscriptions to the capital 
 of the said bank, (exclusively of the subscription aforesaid, on the part of the 
 United States) notice thereof shall be given by the persons under whose super- 
 intendence the subscriptions shall have been made at the city of Philadelphia, 
 in at least two newspapers printed in each of the places, (if so many be print- 
 ed in such places, respectively) where subscriptions shall have been made, 
 and the said persons shall, at the same time, ana in like manner, notify a time 
 and place, within the said city of Philadelphia, at the distance of at least thir- 
 ty days from the time of such notification, for proceeding to the election of 
 twenty directors as aforesaid, and it shall be lawful for such election to be then 
 and there made. And the President of the United States is hereby authoriz- 
 ed, during the present session of Congress, to nominate, and, by and with the 
 advice and consent of the Senate, to appoint, live directors ot the said bank, 
 though not stockholders, any thing in the provisions of this act to the contrary 
 notwithstanding; and the persons who shall be elected and appointed as afore- 
 said, shall be the first directors of the said bank, and shall proceed to elect 
 one of the directors to be president of the said bank; and the directors and 
 president of the said bank, so appointed and elected as aforesaid, shall be ca- 
 pable of serving in their respective office, by virtue thereof, until the end and 
 expiration of the first Monday of the month of January next ensuing the said 
 appointments and elections; and they shall then and thenceforth commence 
 and continue the operations of the said bank, at the city of Philadelphia. 
 
 The directors empowered to appoint officers, clerks, servants, &c. 
 
 SEC. 10. And be it further enacted, That the directors, for the time being, 
 shall have power to appoint such officers, clerks, and servants under them, 
 as shall be necessary for executing the business of the said corporation, and 
 to allow them such compensation for their services, respectively, as shall be 
 reasonable; and shall be capable of exercising such other powers and authori- 
 ties for the well governing and ordering of the officers of me said corporation, 
 as shall be prescribed, fixed, and determined, by the laws, regulations, ana 
 ordinances, of the same. 
 
 Fundamental articles, &c. 
 
 SEC. 11. And be it further enacted, That the following rules, restrictions, 
 limitations, and provisions, shall form and be fundamental articles of the con- 
 stitution 01 the said corporation, to wit: 
 
 Rules concerning voting for directors. 
 
 First. The number of votes to which the stockholders shall be entitled, in vot- 
 ing for directors, shall be according to the number of shares he, she, or they, 
 respectively, shall hold, in the proportions following, that is to say: for one 
 share and not more than two shares, one vote; for every two shares above two, 
 and not exceeding ten, one vote; for every four shares above ten, and not ex- 
 ceeding thirty, one vote; for every six shares above thirty, and not exceeding 
 sixty, one vote; for every eight shares above sixty, and not exceeding one hun- 
 dred, one vote; and for every ten shares above one hundred, one vote; but no 
 person, copartnership, or body politic, shall be entitled to a greater number 
 than thirty votes; and, after the first election, no share or shares shall confer a 
 right ot voting, which shall not have been holden three calendar months pre- 
 
806 APPENDIX. 
 
 yious to the day of election. And stockholders actually resident \vithin the 
 United States, and none other, may vote in elections by proxy. 
 
 Second. Not more than three-fourths of the directors elected by the stock- 
 holders, and not more than four-fifths of the directors appointed by the Pre- 
 sident of the United States, who shall be in office at the time of an annual 
 election, shall be elected or appointed for the next succeeding year; and no 
 director shall hold his office more than three years out of four in succession: 
 but the director who shall be the president at the time of an election may al- 
 ways be re-appointed, or re-elected, as the case may be. 
 
 Third. None but a stockholder, resident citizen of the United States, 
 shall be a director; nor shall a director be entitled to any emolument; but 
 the directors may make such compensation to the president for his extraordi- 
 nary attendance at the bank, as shall appear to them reasonable. 
 
 Fourth. Not less than seven directors slmll constitute a board for the trans- 
 action of business, of whom the president shall ahyays be one, except in case 
 of sickness or necessary absence; in which case his place may be supplied by 
 any other director whom he, by writing, under his hand, shall depute for that 
 purpose. And the director so deputed may do and transact all the necessary 
 business, belonging to the office of the president of the- said corporation, du- 
 ring the continuance of the sickness or necessary absence of the president. 
 
 Fifth. A number of stockholders, not less than sixty, who, together, shall 
 be proprietors of one thousand shares or upwards, shall have power at any 
 time to call a general meeting of the stockholders, for purposes relative to the 
 institution, giving at least ten weeks' notice, in tvyo public newspapers of the 
 place where the bank is seated, and specifying in such notice the object or 
 objects of such meeting. 
 
 Sixth. Each cashier or treasurer, before he enters upon the duties of his 
 office, shall be required to give bond, with two or more sureties, to the satis- 
 faction of the directors, in a sum not less than fifty thousand dollars, with a 
 condition for his good behavior, and the faithful performance of his duties to 
 the corporation. 
 
 Seventh. The lands, tenements, and hereditaments, which it shall be law- 
 ful for the said corporation to hold, shall be only such as shall be requisite for 
 its immediate accommodation in relation to the convenient transacting of its 
 business, and such as shall have been bonafide mortgaged to it by way of se- 
 curity, or conveyed to it in satisfaction of debts previously contracted in the 
 course of its dealings, or purchased at sales, upon judgments which shall have 
 been obtained for such debts. 
 
 Eighth. The total amount of debts which the said corporation shall at any 
 time owe, whether by bond, bill, note, or other contract, over and above 
 the debt or debts due for money deposited in the bank, shall not exceed the 
 sum of thirty-five millions of dollars, unless the contracting of any greater 
 debt shall have been previously authorized by law of the United States. In 
 case of excess, the directors under whose administration it shall happen, shall 
 be liable for the same in their natural and private capacities; and an action of debt 
 may, in such a case, be brought against them, or any of them, their or any of their 
 heirs, executors, or administrators, in any court of record of the United States, 
 or either of them, by any creditor or creditors of the said corporation, and 
 may be prosecuted to judgment and execution; any condition, covenant, or 
 agreement, to the contrary notwithstanding. But this provision shall not be 
 construed to exempt the said corporation, or the lands, tenements, goods, or 
 chattels, of the same, from being also liable for, and chargeable with, the said 
 excess. 
 
 Such of the said directors, who may have been absent when the said excess 
 was contracted or created, or who may have dissented from the resolution^ 
 act whereby the same was so contracted or created^ may respectively exonerate 
 themselves from being so liable, by forthwith giving notice of the tact, and of 
 their absence or dissent, to the President of the United States, and to the 
 stockholders, at a general meeting, which they shall have power to call for 
 that purpose. 
 
CHARTER OF 1816. 807 
 
 <th. The said corporation shall not, directly or indirectly, deal or trade 
 in any thing except bills of exchange, gold or silver bullion, or in the sale ot 
 goods really and truly pledged, for money lent and not redeemed in due time, 
 or goods which shall be the proceeds of its lands. It shall not be at liberty 
 to purchase any public debt whatsoever, nor shall it take more than at the 
 rate of six per centum per annum for or upon its loans or discounts. 
 
 Tenth. No loan shall be made by the ?aid corporation, for the use or on ac - 
 count of the Government of the United States, to an amount exceeding five 
 hundred thousand dollars, or of any particular State, to an amount excecd- 
 ding fifty thousand dollars, or of any foreign Prince or State, unless previously 
 authorized by a law of the United States. 
 
 Eleventh. The stock of the said corporation shall be assignable and trans- 
 ferable, according to such rules as shall be instituted in that behalf, by the 
 laws and ordinances of the same. 
 
 Twelfth. The bills, obligatory and of credit, under the seal of the said cor- 
 poration, which shall be made to any person or persons, shall be assignable 
 by endorsement thereupon, under the hand or hands of such person or persons, 
 and his, her, or their executors or administrators, and his, her, or their assignee 
 or assignees, and so as absolutely to transfer and vest the property thereof in 
 each and everyjassignee or assignees, successively, and to enable such assignee 
 or assignees, and his, her, or their executors or administrators, to maintain an 
 action thereupon, in his, her, or their own name or names: Provided, That 
 said corporation shall not make any bill, obligatory or of credit, or other obliga- 
 tion, under its seal, for the payment of a sum less than five thousand dollars. And 
 the bills or notes which may be issued by order of the said corporation, sign- 
 ed by the president, and countersigned by the principal cashier or treasurer 
 thereof, promising the payment of money to any person or persons, his, her, 
 or their order, or to bearer, although not under the seal ot the said corpora- 
 tion, shall be binding and obligatory upon the same, in like manner, and with 
 like force and effect, as upon any private person or persons, if issued by him, 
 her, or them, in his, her, or their private or natural capacity or capacities, and 
 shall be assignable and negotiable in like manner as if they were so issued by 
 such private person or persons; tiiat is to say, those which shall be payable to 
 any person or persons, his, her. or their ordor, shall be assignable bv endorse- 
 ment, in like manner, and with the like effect as foreign bills of exchange now 
 are; and those which are payable to bearer shall be assignable and negotiable 
 by delivery only: Provided, ThtA all bills or notes, so to be issued by said cor- 
 poration, shall be made payable on demand, other than bills or notes for the 
 payment of a sum not less than one hundred dollars eich, and payable to the 
 order of some person or persons, which bills or notes it shall be lawful for 
 said corporation to make payable at any time not exceeding sixty days from 
 the date thereof. 
 
 Thirteenth. Half yearly dividends shall be made of so much of the profits 
 of the bank as shall appear to the directors advisable; and once in every three 
 years the directors shall lay before the stockholders, at a general meeting, for 
 their information, an exact and particular statement of the debts which shall 
 have remained unpaid after the expiration of the original credit, for a period 
 of treble the term of that credit, and of the surplus of the profits, if any, after 
 deducting losses and dividends. If there shall ba a failure in the payment of 
 any part of any sum subscribed to the capital of the said bank, by any person, 
 copartnership, or body politic, the party failing shall lose the benefit of any 
 dividend which may have accrued prior to the time for making such payment, 
 and during the delay of the same. 
 
 Fourteenth. The directors of the said corporation shall establish a compe- 
 tent oifice of discount and deposite in the District of Columbia, whenever any 
 law of the United States shall require such an establishment; also one such 
 office of discount and deposite in any State in which two thousand shares shall 
 have been subscribed or may be held, whenever, upon application of the Le- 
 gislature of such State, Congress may, by law, require the same: Provided, 
 The directors aforesaid shall riot be bound to establish such office before the 
 b 
 
808 APPENDIX. 
 
 whole of the capital of the bank shall have been paid up. And it shall be law- 
 ful for the directors of the said corporation to establish offices of discount and 
 deposite, wheresoever they shall think fit, within the United States or the 
 territories thereof, and to commit the management of the said offices, and the 
 business thereof, respectively, to such persons, and under such regulations, as 
 they shall deem proper, not being contrary to law or the constitution of the 
 bank. Or, instead of establishing such offices, it shall be lawful for the direc- 
 tors of the said corporation, from time to time, to employ any other bank or 
 banks, to be first approved by the Secretary of the Treasury, at any place or 
 places that they may deem safe and proper, to manage and transact the busi- 
 ness proposed as aforesaid, other than for the purposes ot discount, to be man- 
 aged and transacted by such offices, under such agreements, and subject to 
 such regulations, as they shall deem just and proper. Not more than thir- 
 teen, nor less than seven managers or directors, of every office established as 
 aforesaid, shall ba annually appointed by the directors of the bank, to serve 
 one year; they shall choose a president from their own number; each of them 
 shall be a citizen of the United States ? and a resident of the State, territory, 
 or district, wherein such office is established; and not more than three- fourths 
 of the said managers or directors, in office at the time of an annual appoint- 
 ment, shall be re-appointed for the next succeeding year; and no director 
 shall hold his office more than three years out of four, in succession; but the 
 president may be always re-appointed. 
 
 Fifteenth. The officer at the head of the Treasury Department of the 
 United States shall be furnished, from time to time, as often as he may re- 
 quire, not exceeding once a week, with statements of the amount of the capi- 
 tal stock of the said corporation, and of the debts due to the same; of the 
 moneys deposited therein; of the notes in circulation, and of the specie in 
 hand; and shall have a right to inspect such general accounts in the books of 
 the bank as shall relate to the said statement: Provided, That this shall not 
 be construed to imply a right of inspecting the account of any private indi- 
 vidual or individuals with the bank. 
 
 Sixteenth. No stockholder, unless he be a citizen of the United States, 
 shall vote in the choice of directors. 
 
 Seventeenth. No note shall be issued of less amount than five dollars. 
 
 Penalties for dealing 1 in a way or in articles interdicted. 
 
 SEC. 12. And be it further enacted, That, if the said corporation, or any 
 person or persons, for, or to the use of the same, shall deal or trade in buying 
 or selling goods, wares, merchandise, or commodities, whatsoever, contrary to 
 the provisions of this act, all and every person and persons by whom any 
 order or direction for so dealing or trading shall have been given, and all and 
 every person and persons who shall have been concerned as parties or agents 
 therein, shall forfeit and lose treble the value of the goods, wares, merchan- 
 dise, and commodities, in which such dealing and trade shall have been, one- 
 half thereof to the use of the informer, and the other half thereof to the use of 
 the United States, to be recovered in any action of law, with costs of suit. 
 
 Penalties for making unlawful loans to the United States or particular States, or to 
 
 foreign Governments. 
 
 SEC. 13. And be it further enacted, That, if the said corporation shall ad- 
 vance or lend any sum of money for the use or on account of the Government 
 of the United States, to an amount exceeding five hundred thousand dollars; 
 or of any particular State, to an amount exceeding fifty thousand dollars; or 
 of any foreign Prince or State, (unless previously authorized thereto by a law 
 of the United States) all and every person and persons, by and with whose 
 order, agreement, consent, approbation, and connivance, such unlawful ad- 
 vance or loan shall have been made, upon conviction thereof, shall forfeit and 
 pay, for every such offence, treble the Vxilue or amount of the sum or sums 
 which have been so unlawfully advanced or lent; one-fifth thereof to the use 
 of the informer, and the residue thereof to the use of the United States. 
 
CHARTER OF 1816. $09 
 
 Notes of the hank, unless specially prohibited by la\v, receivable in payments of all 
 
 dues to the United States. 
 
 SEC. II. And be it further enacted, That the bills or notes of the said cor- 
 poration, originally made payable, or which shall have become payable on de- 
 mand, shall be receivable in all payments to the United States, unless other- 
 wise directed by act of Congress. 
 
 The bank to give the necessary facilities, \vitlioutany charge, for transferring the funds 
 of the United States to different quarters. 
 
 SEC. 1 '. . I iid be. it further enacted* That, during the continuance of this 
 act, and whenever required by the Secretary of tlfe Treasury, the said cor- 
 poration slu'.U give the necessary facilities for transferring the public funds 
 from place to place, within the United States, or the territories thereof, and 
 fur distributing the same in payment of the public creditors, without charging 
 commissions or claiming allowance on account of difference of exchange, and 
 >hall also do and perform the several and respective duties of the commis- 
 sioners of loans for the several States, or of any one or more of them, when- 
 ever required by law. 
 
 Deposite* of the public moneys to be made in the bank or its branches, or the reasons 
 to be laid before Congress by the Secretary of the Treasury for its not being done. 
 
 Si:-, . It;. , l lnd be it further enacted* That the deposites of the money of the 
 rniud States, in places in which the said bank and branches thereof may be 
 I'stablished, shall be made in said bank, or branches thereof, unless the Secre- 
 tary of the Treasury shall at any time otherwise order and direct; in which 
 lie Secretary of the Treasury shall immediately lay before Congress, if 
 in session, and if not, immediately after the commencement of the next ses- 
 sion, the reasons of such order or direction. 
 
 Corporation prohibited from suspending payments in specie, by being made charge- 
 able with the payment of interest at the rate of 12 per centum per annum. 
 
 . !?. ,indbe it further enacted* That the said corporation shall not, at 
 any time, suspend or relusv payment in gold and silver, of any of its notes, 
 bills, or obligations: nor of any moneys received upon deposite in said bank, 
 or in any of its ofiices of discount and deposite. And, if the said corporation 
 shall, at any time, refuse, or neglect to pay, on demand, any bill, note, or obli- 
 gation, issued by the corporation, according to the contract, promise, or under- 
 taking, therein expressed; or shall neglect, or refuse to pay. on demand, any 
 moneys received in said bank, or in any of its offices aforesaid, on deposite, 
 to the* person or persons entitled to receive the same, then, and in every such 
 case, me holder of any such note, bill, or obligation, or the person or persons 
 entitled to demand and receive such moneys as aforesaid, shall, respectively, 
 be entitled to receive and recover interest on the said bills, notes, obligations, 
 or moneys, until the same shall be fully paid and satisfied, at the rate of twelve 
 per centum per annum, from the time of such demand as aforesaicj: Provided, 
 That Congress may, at any time hereafter, enact laws enforcing and regulating 
 the recovery of the amount of the notes, bills, obligations, or other debts, of 
 which payment shall have been refused as aforesaid, with the rate of interest 
 above mentioned, vesting jurisdiction for that purpose in any courts, either of 
 law or equity, of the courts of the United States, or territories thereof, or of 
 the several States, as they may deem expedient. 
 
 Penalties for forgoing, counterfeiting-, See. 
 
 SEC. 18. Ami be it further enacted* That, if any person shall falsely make, 
 forge, or counterfeit, or cause or procure to be falsely made, forged, or coun- 
 
 check, on the said bank or corporation, or any cashier thereof; or shall falsely 
 
810 APPENDIX. 
 
 alter, or cause or procure to be falsely altered, or willingly aid or assist in false- 
 ly altering, any bill or note, issued by order of the president, directors, and 
 company, of the said bank, or any order or check on the said bank or corpo- 
 ration, or any cashier thereof; or shall pass, utter, or publish, or attempt to 
 pass, utter, or publish, as true, any false, forged, or counterfeited bill or note, 
 purporting to be a bill or note issued by order of the president, directors, and 
 company, of the said bank, or any false, forged, or counterfeited order or 
 check upon the said bank, or corporation, or any cashier thereof, knowing the 
 same to be falsely forged, or counterfeited; or shall pass, utter, or publish, 
 or attempt to pass, utter, or publish, as true, any falsely altered bill or note, 
 issued by order of the president, directors, and. company, of the said bank, 
 or any falsely uttered order or check on the said bank or corporation, or 
 any cashier thereof, knowing the same to be falsely altered, with inten- 
 tion to defraud the said corporation, or any other body politic, or person; or 
 shall sell, utter, or deliver, or cause to be sold, uttered, or delivered, any 
 forged or counterfeit note, or bill in imitation, or purporting to be, a bill or 
 note, issued by order of the president and directors ot the said bank, know- 
 ing the same to be false, forged, or counterfeited; every such person shall be 
 deemed "and adjudged guilty of felony, and being thereof convicted by due 
 course of law, shall be sentenced to be imprisoned, and kept to hard labor, 
 for not less than three years, nor more than ten years, or shall be imprisoned 
 not exceeding ten years, and fined not exceeding five thousand dollars: Provi- 
 ded, That nothing herein contained shall be construed to deprive the courts 
 of the individual States of jurisdiction, under the laws of the several States, 
 over any^offence declared punishable by this act. 
 
 Penalties fo engraving, after the similitude of the plates used for the bank, any 
 
 plates, &c. 
 
 SEC. 19. Jlnd be it further enacted, That, if any person shall make or en- 
 grave, or cause or procure to be made or engraved, or shall have in his cus- 
 tody or possession, any metallic plate, engraved after the similitude of any 
 plate from which any notes or bills, issued by the said corporation, shall have 
 been printed, with intent to use such plate, or to cause or suffer the same to 
 be used in forging or counterfeiting any of the notes or bills issued by the said 
 corporation; or shall have in his custody or possession, any blank note or 
 notes, bill or bills, engraved and printed after the similitude of any notes or 
 bills issued by said corporation, with intent to use such blanks, or cause or 
 suffer the same to be used in forging or counterfeiting any of the notes or bills 
 issued by the said corporation; or shall have in his custody or possession, any 
 paper adapted to the making of bank notes or bills, and similar to the paper 
 upon which any notes or bills of the said corporation shall have been issued, 
 with intent to use such paper, or cause or suffer the same to be used in forging 
 or counterfeiting any of the notes or bills issued by the said corporation, every 
 such person, being thereof convicted, by due course of law, shall be sentenced 
 to be imprisoned, and kept to hard labor, for a term not exceeding five years; 
 or shall be imprisoned for a term not exceeding five years, and fined in a 
 sum not exceeding one thousand dollars. 
 
 Bonus to be paid to the United States for this charter. 
 
 SEC. 20. And be it further enacted, That, in consideration of the exclusive 
 privileges and benefits conferred by this act, upon the said bank, the presi- 
 dent, directors, and company thereof, shall pay to the United States, out of 
 the corporate funds thereof, the sum of one million and five hundred thou- 
 sand dollars, in three equal payments, that is to say: five hundred thousand 
 dollars at the expiration of two years; five hundred thousand dollars at the 
 expiration of three years; and five hundred thousand dollars at the expiration 
 of four years after the said bank shall be organized, and commence its opera- 
 tions, in the manner herein before provided. 
 
CHARTER OF 1816. 
 
 Congress to establish no other banks except in the District of Columbia, &c. 
 
 >EC. 21. And be it further enacted, That no other bank shall be established 
 by any future law of the United States, during the continuance of the corpo- 
 ration hereby created, for which the mith of the United States is hereby 
 pledged: Provided, Congress may renew existing charters for banks in the 
 District of Columbia, not increasing the capital thereof, and may also esta- 
 blish any other bank or banks in said district, with capitals not exceeding, in 
 the whole, six millions of dollars, if they shall deem it expedient. And, 
 notwithstanding the expiration of the term for which the said corporation is 
 created, it shall be lawful to use the corporate name, style, 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, nor for a period exceeding two years after the expiration 
 of the said term of incorporation. 
 
 Limitation of time prescribed for this bank's going into operation. 
 SEC. 22. And be it further enacted, That, if the subscription and payments 
 to said bank shall not be made and completed so as to enable the same to 
 commence its operations, or if the said bank shall not commence its operations, 
 on or before the first Monday in April next, then, and in that case, Congress 
 may, at any time, within twelve months thereafter, declare, by law, this act 
 null and void. 
 
 Committees of either House of Congress may inspect the books, &.c. of the bank. 
 
 SEC. 23. Jlnd be it further enacted, That it shall, at all times, be lawful for 
 a committee of either House of Congress, appointed for that purpose, to in- 
 spect the books, and to examine into the proceedings of the corporation 
 hereby created, and to report whether the provisions of this charter have been 
 by the same violated or not; and whenever any committee, as aforesaid, shall 
 find and report, or the President of the United States shall have reason to 
 believe, that the charter has been violated, it may be lawful for Congress to 
 direct, or the President to order a scire facias to be sued out of the circuit 
 court of the district of Pennsylvania, in the name of the United States, (which 
 shall be executed upon the president of the corporation for the time beinz, at 
 least fifteen days before the commencement of the term of said court) calling 
 on the said corporation to show cause wherefore the charter hereby granted, 
 shall not be declared forfeited; and it shall be lawful for the said court, upon 
 the return of the said scire facias, to examine into the truth of the alleged 
 violation; and if such violation be made appear, then to pronounce and ad- 
 judge that the said charter is forfeited and annulled: Provided, however, 
 Every issue of fact which may be joined between the United States and the . 
 corporation aforesaid, shall be tried by jury. And it shall be lawful for the 
 court aforesaid to require the production of such of the books of the corpora- 
 tion as it may deem necessary for the ascertainment of the controverted facts; 
 and the final judgment of the court aforesaid shall be examinable in the 
 Supreme Court of the United States, by writ of error, and may be there re- 
 versed or affirmed, according to the usages of law. 
 Approved: April 10, 1816. 
 
 HOUSE OF REPRESENTATIVES. January 13, 1818. 
 
 The Speaker presented a memorial from the President and Directors of the 
 Bank ot the United States, praying that their act of incorporation may be 
 so amended as to authorize the president and cashier of its several offices 
 of discount and deposite to sign and countersign the notes to be issued at 
 said offices; which was referred to a select committee, consisting of Mr. Ser- 
 
APPENDIX, 
 
 geant, Mr. Smith, of Md., Mr. Tallinadge, Mr. Robertson, of Kentucky, and 
 Mr. Ten-ill. 
 
 JANUARY '20, 1818. 
 Mr. SERGEANT, from said committee, reported the following bill: 
 
 A BILL to amend the act, entitled "An act to incorporate the subscribers to the Bank 
 
 of the United States." 
 
 Be it enacted by the Senate and House of Representatives of the United 
 Stales of America in Congress assembled, That the president, directors, and 
 company, of the Bank of the United States, be, and they are hereby, author- 
 ized to dispense with the signatures of the president and principal cashier of 
 the Bank of the United States, to all such bills or notes as may be issued 
 from the respective offices of discount and deposite, which are now, or may 
 hereafter be, established, by the directors of the said corporation, according to 
 law; and that it shall be lawful for the said corporation to authorize the pre- 
 sidents of the said offices, respectively, to sign, and the respective cashiers 
 thereof to countersign, all such bills or notes as aforesaid; which said bills or 
 notes, so signed and countersigned, shall be binding and obligatory upon the 
 said corporation, in like manner, and to all intents and purposes, as fully and 
 effectually as the bills or notes which have been, or may hereafter be, signed 
 by the president, and countersigned by the principal cashier of the said bank, 
 agreeably to the provisions ot the act of incorporation: Provided, That 
 nothing herein contained shall be construed to invalidate or impair the obli- 
 gation and legal effect of any bill or note, signed by the president, and coun- 
 tersigned by the principal cashier of the said corporation, although the same 
 may nerealterbe issued from any office of discount and deposite of the said 
 corporation, established according to law. 
 
 SEC. 2. And be it further enacted, That so much of the act, entitled "An 
 act to incorporate the subscribers to the Bank of the United States, passed on 
 the tenth day of April, one thousand eight hundred and sixteen, as is herein 
 altered or supplied, and no more, be, and the same is hereby, repealed. 
 
 There was no further action on said bill. 
 
 Ix SENATE, January 13, 1818. 
 
 A copy of the same memorial was presented in the Senate, and referred to 
 the Committee on Finance, consisting of Mr. Campbell, Mr. Eppes, Mr. 
 King, Mr. Talbot, and Mr. Macon. 
 
 On the 9th of April, Mr. CAMPBELL reported the following bill, excepting 
 the. proviso, which was added thereto, as an amendment: 
 
 A BILL in addition to "An act to incorporate the subscribers to the Bank of the 
 
 United States." 
 
 Be it enacted, $c. That bills or notes which may be issued by order of 
 "the President, Directors, and Company, of the Bank of the United States," 
 in pursuance of the twelfth rule of the eleventh section of the act incorporat- 
 ing the same, and signed by an assistant president, and assistant cashier, who 
 shall have been appointed by the directors of the said corporation, for the spe- 
 cial service of signing such bills and notes, shall be binding and obligatory 
 upon the same, in like manner, and with like force and effect, as if the same 
 were signed by the president, and countersigned by the principal cashier or 
 treasurer thereof. Provided, always, That only one such"assistant president, 
 and assistant cashier, and, in case of death, resignation, or removal from 
 office, their successors, respectively, be so appointed, for the special purpose 
 aforesaid. 
 
 This bill passed the Senate, but was indefinitely postponed in the House, 
 
RESOLUTIONS, &c. 
 
 HOUSE OF REPRESENTATIVES, February 4, 1818. 
 
 On motion of Mr. FORSYTII, 
 
 * 4 Resolved, That the Committee of Ways and Means be instructed to in- 
 quire whether the Bank of the United States is authorized by its charter, to 
 receive as pledge, or security, for loans made to individuals, or corporations, 
 a transfer of the public debt made to the bank, or to any officer thereof; and 
 if, in their opinion, such transfers are not authorized by the act of incorpora- 
 tion, to report to the House some effectual mode of preventing them from be- 
 ing Hereafter made." 
 
 On the 12th of March, Mr. LOWXDES, from said committee, made the fol- 
 lowing report; which was read, and laid on the table: 
 The Committee of Ways and Means, to whom has been referred a resolution 
 
 of the 4th of February, directing an inquiry into the legality of transfers of 
 
 public debt, made to the Bank of the United States, to secure the payment 
 
 of loans made to them, report: 
 
 That they do not perceive in the words or principles of the law incorpo- 
 rating the bank, any reason to object to the practice which they understand to 
 prevail, of admitting as a substitute for personal security, that which results 
 from a deposite of stock, with a power to sell it, when it may be necessary to 
 enforce payment of the debt. If the object of the law, in limiting the articles 
 in which the bank may trade, be to secure to the mercantile community the 
 facilities which a large banking capital should offer, this practice will conform 
 to such a design. If the object be (although this is not probable) to prevent 
 the competition of the bank in the purchase of stock, and its consequent en- 
 hancement in price, although the practice may prevent the necessity of some 
 sales, this beneficent effect, which may sometimes instigate commercial dis- 
 tress, cannot be objected toby a just and humane Government. Nor can it 
 be objected to the practice in question, that it may enable the bank to throw 
 into the market a quantity of stock, which would depress its value, since this 
 would be to injure the bank as well as the Government, and since itimplies 
 an absolute power to dispose of the property, while the power of the bank is 
 considered as contingent and temporary. 
 
 On the whole, the committee dp not understand the practice to be one 
 which gives to the bank an interest in the price of stock, or an opportunity of 
 speculating in its rise or fall. It is substantially a security, which may be 
 promptly enforced, useful to the merchant whose loans it facilitates, and to 
 the bank whose debts it secures. 
 
 NOVEMBER 30, 1818. 
 Ban 
 
 [See the original resolution, page 714, ante.] 
 
 Mr. Spencer's Resolution for an examination of the Bank of Philadelphia, 
 
 as amended. 
 
 On motion of Mr. M'LANE, the said resolution was amended, by striking 
 out all.thereof, from the words "violated or not," in the third line, until the 
 end of the sentence terminating with the words " since its organization." 
 On motion of Mr. LOWNDES, the words " to report thereon" were inserted 
 after the words " United States," where they first occur. 
 
 Mr. BARBOUR moved further to amend, by striking out the following words: 
 " that the said committee have leave to meet in the city of Philadelphia, and 
 to remain there as long as may be necessary." 
 
 Which was disagreed to: ayes 34, noes 115. 
 
 The resolution, as amended, was agreed to in the following words: 
 
 Resolved, That a committee be appointed to inspect the books and examine 
 into the proceedings of the Bank of the United States; to report thereon, and 
 to report whether the provisions of its charter have been violated or not; 
 that the said committee have leave to meet in the city of Philadelphia, and to 
 
314 APPENDIX. 
 
 remain there as long as may be necessary; that they shall have power to send 
 tor persons and papers, and to employ the requisite clerks, the expense of 
 which shall be audited and allowed by the committee of accounts, and paid 
 out of the contingent fund of this House.* 
 
 JANUARY 16, 1818. 
 
 Mr. SPENCER made a detailed report, seepage 714, ante. 
 
 On the same day, Mr. SPENCER, from the same committee, reported the 
 following bill: 
 
 A BILL to enforce those provisions of the act, entitled "An act to incorporate the sub- 
 scribers to the Bank of the United States," which relate to the right of voting for 
 directors. 
 
 Be it enacted by the Senate and House of Representatives of the United 
 States of America in Congress assembled, That, in all elections of directors 
 of the Bank of the United States, hereafter to be held, under, and by virtue 
 of, the "Act to incorporate the subscribers to the Bank of the United States," 
 whenever any person shall offer to the judges of such election more than thir- 
 ty votes in the whole, including those offered in his own right, and those 
 offered by him as attorney, proxy, or agent for any others, the said judges of 
 the elections, or any one of them, are hereby authorized and required to ad- 
 minister to the said person, so offering to vote, the following oath or affirmation, 
 viz: 
 
 I, ; , do solemnly swear, (or affirm, as the case my be) that I 
 
 have no interest, directly or indirectly, in the shares upon which I shall vote 
 :it this election, as attorney for others; that those shares are, to the best of my 
 knowledge and belief, truly and in good faith, owned by the persons in whose 
 names they now stand; and that, in voting at this election, I shall not, in any 
 manner, violate the first fundamental article of the "Act to incorporate the 
 subscribers to the Bank of the United States." And the said judges of elec- 
 tions, or any one of them, shall be authorized and empowered, in their discre- 
 tion, or at the instance of any stockholder of the bank, to administer the 
 said oath or affirmation to any person offering to vote at any such election. 
 And, if any person shall wilfully and absolutely swear or affirm falsely, in. 
 taking the said oath or affirmation, such person, so offending, shall, upon due 
 conviction thereof, be subject to the painsand penalties which are bylaw pre- 
 scribed for the punishment of wilful aud corrupt perjury. 
 
 SEC. 2. Jind be it further enacted, That, if the judges of any election of 
 directors, to be held as aforesaid, shall permit any person to give more than 
 thirty votes in the whole, at any such election, without the said person's ha- 
 ving taken the aforesaid oath or affirmation, such of the said judges as shall 
 consent thereto, shall severally be deemed guilty of a misdemeanor, and, on 
 
 due conviction thereof, shall be subject to a fine, not exceeding , or to 
 
 imprisonment not exceeding , at the discretion of the court before 
 
 which such conviction shall be had. 
 
 FEBRUARY 9, 1818. 
 Mr. JOHNSON, of Virginia, submitted the following resolution: 
 
 Resolved, That the Committee on the Judiciary be instructed to report a 
 bill to repeal the act, entitled "An act to incorporate the subscribers to the. 
 Bank of the United States," approved April 10, 1816. Said resolution was 
 read, and, together with those offered previously, by Mr. Spencer and Mr. 
 Trimble, were committed to a committee of the whole on the state of the 
 Union. 
 
 On the same day, Mr. MASON, of Massachusetts, presented a memorial, 
 signed by sundry stockholders/^' the bank, residing in Boston and its vicinity, 
 representing their full confidence in the said institution, and expressing their 
 
 * [For the debate on this resolution, see National Intelligencer of 1st December, 
 
 1818.] 
 
BILL TO REGULATE VOTING. 815 
 
 hope that no measures would be adopted, calculated in any manner to weaken 
 or destroy that confidence; which was laid on the table. 
 
 On the 15th of February, a similar memorial was ^presented by Mr. WEN- 
 DOVER, from stockholders residing in the city of New York, which was re- 
 ferred to a committee of the whole on the state of the Union. 
 
 FEBRUARY 24, 1819. 
 
 Mr. SMITH, of Maryland, from the committee of the whole on the state of 
 the Union, reported their disagreement to the resolutions offered by Mr. John- 
 son and Mr. Trimble [see page 732, and 734 ante'] and reported the fore- 
 going bill with amendments: 
 
 Whereupon, Mr. SPENCER moved to lay the whole report on the table. 
 
 Mr. HARRISON called for a division of the question, so as to except from its 
 effects so much of the said report as relates to the foregoing resolutions. On 
 which the House adjourned. 
 
 FEBRUARY 25, 1819. 
 
 Mr. SPEXCER withdrew his motion, and the House affirmed the report of 
 the committee of the whole, as heretofore stated. 
 
 Whereupon, the House proceeded to consider the aforesaid bill and amend- 
 ments. 
 
 Mr. STORRS moved to lay the bill and amendments on the table; which mo- 
 tion was rejected. 
 
 A motion was then made by Mr. PINDALL, to refer the said bill to the Com- 
 mittee on the Judiciary, with instructions to amend the same by additional 
 sections, as follows, to wit: 
 
 1. To prohibit the offence of usury, and to declare the punishment thereof, 
 when committed by the Bank ot the United States, or its branches, or by the 
 directors, officers, or agents thereof, whilst employed for, or on behalf of, the 
 bank; and to prescribe the mode of prosecution for such offence. 
 
 2. To prohibit the establishment or continuance, by the said bank, of any 
 office of discount or deposite. in any State, after the first day of February, 
 1820, unless by the consent or the Legislature of such State. 
 
 Whereupon, Mr. HARRISON moved to postpone the bill indefinitely, which 
 motion being rejected, the question was taken on Mr. PINDALL'S motion, and 
 decided in the negative. 
 
 Mr. SPENCER moved to amend the first amendment of the committee o^ 
 the whole, and Mr. BALDWIN moved that the bill be postponed indefinitely. 
 
 Several ineffectual attempts were, afterwards, made to amend the said bill* 
 and another motion was made, by Mr. HARRISON, to postpone it indefinitely* 
 which being rejected, Mr. JOHNSON, of Virginia, moved to add to the bill a 
 fourth section, (see 4th section of the act hereafter) which was agreed to: 
 Yeas 98, Nays 26. 
 
 Mr. POINDEXTER moved to add to the said bill the following: "That this 
 act shall commence and be in force when the same shall have been assented 
 to by a majority of the stockholders of the Bank of the United States;" which 
 being rejected, the bill was ordered to be engrossed for a third reading: Ayes, 
 93, Noes, 38. And, on the following day, 26th February, 1819, was passed, 
 and without amendment in the Senate, became a law, as follows: 
 
 AN ACT to enforce those provisions of the act, entitled " An act to incorporate the 
 subscribers to the Bank of the United States," which relate to the right of voting 1 
 for directors, and for other purposes. 
 
 SEC. 1. Beit enacted, fyc. That, in all elections of directors of the Bank 
 of the United States, hereafter to be held under, and by virtue of, the " Act 
 to incorporate the subscribers to the Bank of the United States," whenever 
 any person shall offer to the judges of such election more than thirty votes, 
 in the whole, including those offered in his own right, and those offered by 
 c 
 
816 APPENDIX. 
 
 him as attorney, proxy, or agent, for any others, the said judges of the elec- 
 tions, or any one of them, are hereby authorized and required to administer 
 to the said person, so offering to vote, the following oath or affirmation, viz: 
 
 I* , do solemnly swear (or affirm, as the case may be.) that I have no 
 
 interest, directly or indirectly, in the shares upon which I shall vote at this 
 election, as attorney for ol tiers; that those shares are, to the best of my 
 knowledge and belief, truly, and in good faith, owned by the per sons in whose 
 names they now stand; and that, in voting at this election, I shall not, in any 
 manner, violate the first fundamental article of the " tfct to incorporate the 
 subscribers to the Bank of the United States." And the said judges of elec- 
 tions, or any one of them, shall be authorized and empowered, in their dis- 
 cretion, or at the instance of any stockholder of the bank, to administer the 
 said oath or affirmation to any person offering to vote at any such election, 
 
 SEC. 2. That no person shall be entitled to vote at any such election, as 
 attorney, proxy, or agent, for any other person, copartnership, or body politic, 
 without a power, for that purpose, being duly executed, in the presence of a 
 witness, and filed in the bank, and on which power shall be endorsed the oath 
 or affirmation of the person, or one of the copartners, or of the head, or some 
 of the officers, of the body politic granting such power, in the words follow- 
 ing: "7, , do solemly swear (or affirm, as the case may be,) that I am, 
 
 (or that the copartnership, consisting of myself and , are, or that the cor- 
 poration known by the name of, is, as the case may be,) truly, and in 
 in good faith, the owner, (or the owners, as the case may be,) of the shares 
 in the capital stock of the Bank of the United States, specified in the within 
 power of attorney, and of no otfier shares; that no other person has any in- 
 terest in the said shares, directly or indirectly, except as stated in the said 
 j)ower, and that no other power has been given to any person, which is now 
 in force, to vote for me, (or for the copartnership aforesaid, or for the body 
 politic aforesaid, as the case maybe) at any election of directors of the said 
 bank;" which oath or affirmation may be taken before a notary public, judge, 
 or justice of the peace, and shall be certified by him. 
 
 SEC. 3. That, if the judges of any election of directors, to be held as afore- 
 said, shall permit any person to give more than thirty votes, in the whole, at 
 any such election, without the said person's having taken the aforesaid oath 
 or affirmation, or shall suffer any person whatever to vote as attorney, agent,, 
 or proxy, for any other person, or for any copartnership, or body politic, with- 
 out a power for that purpose, as prescribed in the foregoing section, with the 
 oath or affirmation and certificate aforesaid; such of the said judges as shall 
 consent thereto, shall severally be deemed guilty of a misdemeanor, and, on 
 due conviction thereof, shall be subject to a fine not exceeding two thousand 
 dollars, or to imprisonment not exceeding one year, at the discretion of the 
 court before which such conviction shall be had. And if any person shall 
 wilfully and absolutely swear or affirm falsely, in taking any oath or affirma- 
 tion prescribed by this act, such person, so offending, shall, upon due con- 
 viction thereof, be subject to the pains and penalties which are, by law, pre- 
 scribed for the punishment of wilful and corrupt perjury. 
 
 SEC. 4. That, if any person shall, directly or indirectly, give any sum or 
 sums of money, or any other bribe, present, or reward, or any promise, con- 
 tract, obligation, or security, for the payment or delivery of any money, pre- 
 sent, or reward, or any thing to obtain or procure the opinion, vote, or inte- 
 rest, of the president of the Bank of the United States, or either of the 
 directors thereof, or the president or a director of either of the branches of the 
 said bank, in any election, question, matter, or thing, which shall. come before 
 the said president and directors for decision, in relation to the interest and 
 management of the business of the said bank, and shall be thereof convicted ; 
 such person or persons, so giving, promising, contracting, or securing to be 
 given, paid, or delivered, any sum or sums of money, present, reward, or 
 other bribe as aforesaid, and the president or director who shall, in any wise, 
 accept or receive the same, on conviction thereof, shall be fined and impri- 
 soned at tKe discretion of the court, and shall forever be disqualified to hold 
 
BANK MEMORIAL 
 
 February 26, 1819. 
 
 On motion of Mr. SPENCER, the committee of the whole on the state of the 
 Union, was discharged from the further consideration of his resolution, and it 
 was laid on the table. [See the resolution, page 732, ante.'} 
 
 MARCH 1, 1819. 
 Mr. Spencer a Resolution, asking hiformation respecting the condition of the 
 
 Bank. 
 On motion of MV. SPENCER, 
 
 4i Resolved, That the Secretary of the Treasury be requested to transmit to 
 Congress, at an early period of the next session, a general statement of the 
 conclition of the Bank of the United States, and its offices, similar to the re- 
 turns made to him by the bank; and a statement exhibiting, as nearly as may 
 be practicable, the amount of capital invested in the different chartered banks 
 in the several States, and in the District of Columbia: the amount of notes 
 issued by those banks, and in circulation; the public and private deposites in 
 them; the amount of loans and discounts made by them, and remaining un- 
 paid; and the total quantity of specie they possess; and that he be requested 
 also, to report such measures, as in his opinion may be expedient, to procure 
 and retain a sufficient quantity of gold and silver coin in the United States, 
 or to supply a circulating medium in place of specie, adapted to the exigen- 
 cies of the country, and within the power of the Government." 
 
 On the 24th of February, 1820, the Secretary of the Treasury, (WILLIAM 
 H. CRAWFORD,) made an elaborate reply to this call, furnishing, at great 
 length, the information required. His letter may be found among the Ex- 
 ecutive Papers, Vol.6, of the 1st session of the 16th Congress, Document 
 No. 86. 
 
 HOUSE OF REPRESENTATIVES, December 13, 1820. 
 
 Mr. SERGEANT presented the following memorial, which was referred to a 
 select committee, consisting of Mr. Sergeant, Mr. Whitman, Mr. Tyler, 
 Mr. Gorham, and Mr. Karelin. 
 
 No report was made thereon. 
 
 A similar memorial was presented in the Senate. It is as follows: 
 
 To the Honorable the Speaker and members of the House of Representatives 
 of the United States. 
 
 The Memorial of the President and Directors of the Bank of the United 
 States, on the part of the stockholders of the said bank, respectfully 
 showeth: 
 
 That the institution, of which they are managers, is laboring under seve- 
 ral grievances, not only injurious to the Bank, but, as they respectfully con- 
 ceive, to the nation also, which call for legislative relief. Some of these arise 
 from the original omission of appropriate legal enactments; others, from cer- 
 tain provisions of the charter, not suited to the condition and circumstances 
 of the bank; and one, of very important character, from a regulation con- 
 cerning the fiscal receipts of the Government of the Union. For the remedy 
 of these evils, the stockholders of the Bank of the United States can only 
 look to Congress. Under the pledge of its sacred faith, and by its authority, 
 the institution was established, ana their natural refuge is, therefore, to the 
 National Legislature, for that relief and protection which the citizen has a 
 right to claim of his Government. Of that body they know they can obtain 
 
818 APPENDIX. 
 
 nothing forbidden by the sound policy of the State; and could their interest 
 dictate a request inconsistent with that policy, they would forbear to make it; 
 but it is under a conviction of the justice and correctness of their requests 
 that, as citizens, and as a portion of tho?-? whose prosperity constitutes the 
 public good, they respectfully ask the attention of Congress to the grievances 
 under which they labor. They ask relief, only if it be found to be consist- 
 ent with the public welfare; and if it be, they will, they are convinced, not 
 ask in vain; while they feel satisfied that they will be able to show to your 
 honorable body, not only that their claims are consistent with it, but that they 
 are eminently calculated to advance and promote it. 
 
 Your petitioners are aware that strong prejudices have existed against the 
 Bank of the United States, and certainly there has been abundant cause for 
 more than prejudice, against some of the acts which have marked the pro- 
 gress of the institution. But these acts have been offences, not against the 
 public or the Government, (except as it is a stockholder) but against the in- 
 nocent and undesigning stockholders, on whose behalf your petitioners now 
 ask protection and relief. Offences of inferior turpitude, and 9f inferior pub- 
 lic injury, under almost all Governments, have been restrained by severe 
 punishments. By the charter granted by the Congress of the Confederation, 
 to the Bank of North America, it was proposed to make some of these 
 offences felony, and they were accordingly made felony by several acts of the 
 Legislature of Pennsylvania. But, though in the progressive experience of 
 this institution, one example of infidelity, peculation, and fraud, has produ- 
 ced another, and that another and another, and though it lias been defrauded 
 of mil lions of dollars, it is yet entirely without the preventive protection of effec- 
 tive and appropriate penal laws. Will it be believed, too, that these acts, so inju- 
 rious to the Bank; that these losses, so afflictive to the innocent and suffering 
 stockholders; have excited against the institution the prejudices which your 
 petitioners now so anxiously deprecate? Yet it is a truth, that those are the 
 sole causes of which your petitioners have any knowledge. For they cannot 
 believe that it is considered a crime, at least, not in the eyes of that Legisla 
 ture from whom they purchased their privileges, for the stockholders toliave 
 associated together, and to have placed their property under the protection of 
 the most solemnly considered act that has marked the existence of the Go- 
 vernment an act, the validity of which, all political denominations of men 
 in the country, (at long intervals of time, giving ample room for reflection and 
 investigation) and all departments of the Government, have repeatedly and 
 solemnly considered and confirmed. The usefulness of the bank to the Go- 
 vernment and to the country; its purifyingeftectupon, and sustaining aid of, the 
 currency; its support of the public credit, and its general benign influence on 
 the interests of every solvent man, and every solvent institution in the coun- 
 try, if not readily acknowledged, your petitioners believe can be satisfactorily 
 shown. But, more effectually to dissipate the public prejudices, if any re- 
 main, your petitioners entreat your honorable body to inquire who now are the 
 persons really interested in this much injured institution? They will be found 
 to be, with few exceptions, original subscribers, who have continued to hold 
 their stock, alike ignorant and innocent of the frauds to which their interests 
 were a prey; or, they are unfortunate purchasers, who, deceived by the false 
 appearances which the affairs of the institution exhibited, gave an advance of 
 from twenty to fifty per cent, on their purchases. Among those now inter- 
 ested, are all the classes of human helplessness; and among the funds involv- 
 ed in the fate of the institution, are those of charity and religion, to no in- 
 considerable amount. Of these facts, your petitioners are ready to give satis- 
 factory proof to your honorable body, and crave to be permitted to do so, if 
 it shall be doubted or deemed material. 
 
 Under these circumstances, your petitioners will proceed, succinctly, to 
 state the particular subjects on which they respectfully request relief and pro- 
 tection from Congress. 
 
 First. The charter provides that no director, except the president, shall be 
 eligible for more than three years in four. This provision has, in practice. 
 
BANK MEMORIAL. 
 
 been found to deny to the bank the services of those men who are best quali- 
 fied to administer its affairs with safety and profit to the institution. It is a 
 provision not contained, your petitioners believe, in the charter of any re- 
 spectable banking institution. It was not contained in the charter of the form- 
 er Bank of the United States, and it would seem that the provision of the 
 charter, which forbids the re-election of more than three -fourths of the direc- 
 tors in office, at the time of an annual election, (to which your petitioners 
 have no objection) is calculated to effect all the ends of the embarrassing pro- 
 vision, from which your petitioners now crave relief. 
 
 Second. At present, there is no authority, under the laws of Congress, to 
 punish any fraud, peculation, or violation 01 trust, committed by any of the 
 officers of the bank, or its offices 5 and on this point the State laws are also 
 supposed to be deficient. Nor is there any adequate civil remedy for the bank 
 against its faithless agents, who may, the hour before their dismissal from office, 
 while the investigations necessary to their removal indicate to them that re 
 suit, take the property of the bank from its vaults, and withhold it, spend it, 
 and. if they please, give it inpayment to their other creditor*, in exclusion of 
 the bank from which it has been thus purloined. 
 
 Third. Under the charter, it has been doubted whether the bank has pow- 
 er to authorize the issuing of notes not signed by the president and counter- 
 signed by the cashier. The labor and the time necessary to sign notes for the 
 bank and all its branches, are much greater than either of those officers can 
 bestow upon that object, and hence the bank has been unable to put in circu 
 lation a sufficient amount of notes, of the smaller denominations, which the 
 public most want, and which are best calculated to serve the interest of the 
 bank. If authority were given to the board, from time to time, to appoint 
 one or more persons to sign notes of the smaller denominations, at the parent 
 bank, under the superintendence and direction of the board and its principal 
 officers, there would be no public risk, and it would afford all the aid which 
 your petitioners desire on the point. 
 
 Fourth. Under the fourteenth section of the act incorporating the bank, 
 the bills or notes of the bank, originally made payable, or which shall have 
 become payable, on demand, are made receivable in all payments to the Unit- 
 ed States, unless otherwise directed by act of Congress. Under this regula- 
 tion, the power of the bank to make its capital available, either for its own 
 profit, or the public good, is greatly abridged. The sphere of its circulation 
 is limited to tnose places where it is least wanted, ancl made to exclude those 
 >vhere it would be eminently useful, while the whole currency of vast sec- 
 tions of the country is thereby frequently greatly embarrassed. 
 
 Your petitioners forbear to enter, at this time, into a further exposition of 
 the grounds of their application for relief on these points; but respectfully 
 hope and request that your honorable body will so dispose of the subject as to 
 give them an opportunity of manifesting the justice, as it regards the Bank, 
 and the policy, as it regards the public, of the relief and protection which 
 they respectfully claim. 
 
 On behalf of the Board of Directors. 
 
 Attest, L. CHEVES, President. 
 
 THO. NELSON, Cashier. 
 
 IN SENATE, December 1, 1820. 
 Mr. ROBERTS presented a memorial* similar to that presented in the House; 
 
 * Accompanying the memorial was a document submitted by a <* committee of the 
 bank," for that purpose appointed, to the Committee on Finance, in the Senate, in 
 which are detailed, more at large than in the memorial itself, the grievances under 
 which they suppose the bank to labor. [See Senate Documents, 2d Session of 16th 
 Congress, Document 45 y page 7.] 
 
320 APPENDIX. 
 
 which was, on motion of Mr. BARBOUR, referred to the Committee on Fi- 
 nance, consisting of Mr. Sanford, Mr. Macon, Mr. Dana, Mr. Eaton, and 
 Mr. Holmes, of Maine, by whom, on the 20th of December, 1820, the follow- 
 ing bill was reported, to wit: 
 
 A BILL to amend the act incorporating the United States' Bank. 
 
 Be it enacted, fyc. That it shall be lawful for the directors of the Bank o* 
 the United States to appoint an agent and register,- and that all bills and 
 notes of the said corporation, issued after the nrst appointment of such agent 
 and register, shall be signed by the agent, and countersigned by the register: 
 that such bills and notes shall have the like force and effect as the bills and 
 notes of the said corporation which are now signed by the president, and 
 countersigned by the cashier thereof; and that, as often as an agent or register 
 of the said corporation shall be appointed, no note or bill signed by an agent, 
 or countersigned by a register, shall be issued, until public notice of the ap- 
 pointment of such agent or register shall have been previously given, for ten 
 days, in two gazettes printed in the city of Washington. 
 
 SEC. 2. Jind be it further enacted, That if any president, director, cashier, 
 or other officer or servant of the Bank of the United States, or of any of its 
 offices, shall fraudulently convert to his own use, any money, bill, note, se- 
 curity for money, evidence of debt, or other effects whatsoever, belonging to 
 the said bank, such person shall, upon due conviction, be punished by im- 
 prisonment, not exceeding three years, and by standing in a pillory not more 
 than three times, in open day, in some public place, during one hour at a 
 time, which standing in a pillory, when inflicted more than once, shall be on 
 different days. 
 
 IN SENATE, January 12, 1821. 
 
 The Senate took up the said bill, when Mr. SANFORD, in a speech of con- 
 siderable length, laid before the Senate the views which operated on the Com- 
 mittee of Finance, in recommending this bill; the reasons in favor of its pro- 
 visions, and those which induced the committee not to recommend the two 
 other objects petitioned for by the bank. 
 
 Mr. ROBERTS moved to amend the bill by adding thereto the following 
 sections: 
 
 " SEC. 3. iftnd be it further enacted* That the bills or notes of the offices 
 of discount and deposite of the said bank, excepting those of the office in the 
 District of Columbia, originally made payable, or which shall have become 
 payable on demand, shall be receivable, in all payments to the United States, 
 only in the States and territories in which they are made payable, and in the 
 States and territories in which no office of discount arid deposite shall be 
 established, any thing in the fourteenth section of the act incorporating the 
 subscribers to the Bank of the United States, to the contrary notwithstand- 
 ing: Provided, That all notes of the denomination of five dollars, issued 
 either by the bank, or any of its offices of discount and deposite, made paya- 
 ble on demand, shall be receivable at the bank or any of its offices: And 
 provided, further, That it shall not be lawful for the directors of the said 
 bank to establish more than one office of discount and deposite in any State, 
 without the consent of the Legislature thereof first had and received, 
 
 u SEC. 4. And be it further enacted, That so much of the second and four- 
 teenth fundamental articles of the constitution of the said bank, contained in 
 the eleventh section of the act incorporating the subscribers thereto, as pro- 
 vides that no director of the said bank, or any of its offices of discount and 
 deposite, shall hold his office more than three years out of four in succession, 
 be, and the same is hereby, repealed. 
 
 " SEC. 5. Jind be it further enacted, That the directors of the said corpo- 
 ration shall cause a list of the stockholders of the said bank, together with 
 
CONFIDENTIAL PAPERS. 
 
 their places of residence, to be kept in the banking house at Philadelphia, 
 open to the inspection or any and every stockholder of said bank, who may 
 apply for the same within the hours of business, for at least ninety days pre- 
 viously to every annual election of directors; and no person who may be en- 
 titled to vote at any election for directors of said bank, as attorney, proxy, 
 or agent, for any other person, co-partnership, or body politic, shall, as such, 
 
 give a greater number than votes, underbuy pretence whatsoever, and 
 
 no letter of proxy shall be of any force or effect longer than years, or 
 
 until it shall have been revoked. 
 
 " SEC. 6. And be it further enacted, That ? whenever the said corporation 
 assent to the provisions of this act, and certify such assent 10 the Secretary 
 of the Treasury Department, by writing, duly authenticated, this act shall 
 be of full force and effect, and not otherwise." 
 
 After these amendments had been otfered, the bill was, on motion, post- 
 poned till Wednesday. 
 
 ON THE PRINTING OF CERTAIN DOCUMENTS. 
 
 Mr. SAN T FORD haying laid before the Senate sundry papers connected with 
 the subject of this bill, which had been communicated to the Committee of 
 Finance, by the bank, to enforce the expediency of granting the objects prayed 
 for in their memorial, 
 
 Mr. OTIS moved that those papers be printed for the use of the Senate. 
 
 Mr. BARBOUR moved that all the papers submitted to the Committee on 
 Finance, by the bank, be printed. 
 
 [This motion was understood, by the debate which ensued on it, to refer to 
 a particular paper which had been communicated to the committee by tlu* 
 bank, with a request that it might be received confidentially; which paper is 
 understood to contain a statement of frauds committed on the bank, and the 
 names of those persons or officers who committed them. Note by the Re- 
 porter. ] 
 
 A good deal of discussion took place on this motion; the debate turned prin- 
 cipally, on the propriety of making public, information of this personal cha- 
 racter, which had been confidentially communicated to a committee of the 
 body to whom the subject had been referred, simply to show the expediency 
 of granting to the bank the security of penal sanctions, against violations of 
 trusts, by its officers, and the reason which existed for asking of Congress this 
 additional guard against such treacherous spoliations; some gentlemen being 
 in favor of making the information public, as a just punishment of the offend- 
 ers, and a warning to the world against them; and others being opposed to 
 disclosing it, under the circumstances in which it came to the knowledge of 
 the Senate. In the course of the debate, it appeared that the document was 
 not now in the possession of the committee, and part of the discussion related 
 to the propriety of taking measures to obtain it, the proper mode of proceed- 
 ing in that matter, &c. The debate was terminated by a motion by Mr. 
 SMITH, to postpone the subject to Monday, with the view of submitting a 
 resolution on the subject. The desired postponement took place. 
 
 On the 17th of January, the subject being resumed, Mr. BARBOUR'S motion 
 was negatived, anil the original motion of Mr. OTIS was agreed to. 
 
 FEBRUARY 19, 1821. 
 
 The bill, vyith Mr. ROBERTS'S amendments, being before the Senate as in 
 committee of the whole, the amendments were rejected. Yeas 7, Nays 30. 
 
 The bill was further amended, and ordered to be engrossed fora third read- 
 ing, and on the next day it passed the Senate. 
 
 This bill, "when sent to the House of Representatives, was riot acted on by 
 that body. 
 
V 
 
 822 APPENDIX. 
 
 RESOLUTION OF MR. SMITH, OF S. C. 
 
 IN SENATE, January 15, 1821. 
 
 Mr. SMITH, of S. C. submitted the following resolution, to-vvit: 
 44 Resolved, That, the better to enable Congress, in considering a bill *' to 
 amend the act, entitled an act to incorporate the subscribers to the Bank of 
 the United States, to apportion the punishment to be inflicted upon the pre- 
 sidents, directors, cashiers, or other officers, or servants of the Bank of the 
 United States, and of its several offices or branch banks," the President of 
 the bank be requested to transmit to the Senate, if any such exists, a state- 
 ment of any and all fraudulent conversions by the said presidents, directors, 
 cashiers, officers, or servants, or any of them, of any moneys, bills, notes, 
 securities for moneys, evidences of debt, or other effects whatsoever, belong- 
 ing to the said bank, to his or their own use. And in what offices these frauds 
 have been practised, and to what extent, and by whom committed, and at 
 what times. And likewise to state what facilities each of those several offi- 
 cers have, by means of their stations, respectively,] to commit frauds of this 
 character." 
 
 The Senate took the same into consideration, and on motion of Mr. SAN- 
 FORD, the resolution was amended by adding a request for "a statement of 
 the number of bank notes issued by the bank, signed by the president and 
 countersigned by the cashier thereof, of every different amount or denomina- 
 tion; and also a statement of the amount of notes heretofore issued and made 
 payable at the principal bank, and the amount of notes made payable at the 
 different offices." 
 
 The resolution, thus amended, was, on the 17th of January, disagreed to. 
 
 THE OHIO PROCEEDINGS. 
 
 IN SENATE, February 1, 1821. 
 
 The President communicated a letter from the Governor of Ohio, trans- 
 mitting the report and resolutions of the joint committee of bath Houses of the 
 General Assembly of that State, on the communication of the auditor of state, 
 upon the subject of the proceedings of the Bank of the United States, against 
 the officers of said State, in the circuit court ot the United States, and which 
 were approved and adopted by the said General Assembly. The letter, re- 
 port, and resolutions, were read, and, 
 On motion of Mr. EATON, 
 
 Were ordered to be referred to the committee on Finance, and to be 
 printed. 
 
 On the 21st of February, on motion of Mr. SANFORD, the said committee 
 were discharged from the further consideration of the subject. 
 
 The letter of the Governor of Ohio, and accompanying report and resolu- 
 tions, may be found in the " Senate Documents," vol. 2d, for the 2d session 
 of the 16th Congress, Doc. No. 72. 
 
 A like communication was, at the same time, made to the House of Repre- 
 sentatives, and laid on the table; but it does not appear to have been printed 
 by their direction; and no further order was taken thereon. 
 
 UNITED STATES' BANK MEMORIAL. 
 
 HOUSE OF REPRESENTATIVES, December 12, 1821. 
 
 Mr, SERGEANT again presented the memorial of the Bank, being a copy of 
 that presented at the last session; and it was referred to a select committee, 
 consisting of Mr. Sergeant, Mr. Gorham, Mr. Colden, Mr. Stevenson, and 
 Mr. Little. 
 
RESOLUTIONS. 823 
 
 Resolution Respecting Usury. 
 
 DECEMBER 20, 1821. 
 
 Mr. GOLDEN moved the following resolution: 
 
 " Resolved, That the said committee be directed to inquire whether the 
 Bank of the United States has not taken, and is not in the practice of taking, 
 more than six per cent, per annum for, or upon, its loans or discounts." 
 
 MARCH 7, 1822. 
 
 Mr. SERGEANT, from the said committee, made the following report; which 
 was read, and ordered to lie on the table. 
 The committee on the memorial of the Bank of the United States, to whom 
 
 was referred a resolution directing them to inquire 4< whether the Bank of 
 
 the United States has not taken, and is not in the practice of taking, more 
 
 than six per centum per annum for, or upon, its loans or discounts," report: 
 
 That, having inquired into the facts deemed to be material in relation to the 
 question proposed in the resolution, they find, 
 
 1st. That it is, and, from the establishment of the Bank of the United 
 States, has been, the practice of that bank, in calculating the discount upon a 
 note payable a certain number of days after the date, to compute the interest 
 upon a month of thirty days, and the fractions of such a month. Thus one 
 per cent, is charged tor sixty days. 
 
 In this respect, the bank has conformed to the established, and, it is be- 
 lieved, universal usage in the United States, prevailing among individuals as 
 well as in moneyed institutions, and to the most approved tables heretofore in 
 use. 
 
 2d. That, in charging the discount upon a sixtv days' note, the bank and its 
 branches have followed the usage of the place where the loan was made, as to 
 the number of days (including the days of grace) for which the discount 
 should be computed. In general, it has been the practice in the United States 
 to charge the interest for sixty-four days: but there are some places where the 
 interest is charged for only sixty-three (fays, and the branches established at 
 such places have conformed to the practice there prevailing. 
 
 The committee do not think that there is any thing in either of the modes of 
 computing interest adopted by the bank which calls for legislative interposition, 
 and, therefore, submit the following resolution: 
 
 Resolved, That the committee be discharged from the further consideration 
 of the subject. 
 
 RESOLUTION BY MR. ARTHUR SMITH. 
 
 JANUARY 10, 1822. 
 
 Mr. ARTHUR SMITH submitted the following resolution: 
 
 44 Resolved, That the Committee to whom was referred the memorial of the 
 Bank of the United States, be instructed to inquire into the expediency of 
 making it the condition on which any alteration of the charter, for the benefit 
 of said bank, shall be made, that the eighth clause of the fundamental articles 
 of the constitution of the said bank, be so amended, as to limit the said bank 
 in the contraction of debts, and the issue of its notes, to some multiple of the 
 gold and silver coin of the lawful currency of the United States, actually in its 
 vaults or possession, and held to answer the demands against it; that the said 
 committee also inquire into the expediency of providing, that the plea of the 
 act of limitations shall not bar a recovery in an action brought on a note or notes 
 issued by the Bank of the United States, and payable to bearer." 
 
 This resolution was disagreed to by the House. 
 
 IN SENATE, December 27, 1821. 
 
 Mr. FINDLAY presented a memorial of the president and directors of the 
 bank, which appears to have been a copy of that presented by Mr. Roberts at 
 d 
 
324 APPENDIX. 
 
 the last session. It was referred to the Committee on Finance, consisting of 
 Mr. Holmes, of Maine, Mr. Eaton, Mr. Macon, Mr. Van Buren, and Mr. 
 Lowrie. 
 
 On the 24th of January, 1822. Mr. HOLMES, from the said committee, re- 
 ported a bill, which was identical with that reported in Senate, on the 20th of 
 December, 1820, (see p. 820) except that it substituted a pecuniary fine, instead 
 of the punishment of the pillory, as directed by the Tormer act, as trie sanc- 
 tion of its provisions. 
 
 FEBRUARY 8, 1822. 
 
 Mr. FINDLAY moved to recommit the bill to the Committee on Finance, 
 "with instructions to introduce a provision suspending, for five years, or other- 
 wise-modifying so much of the charter of the Dank, as declares that the direc- 
 tors of the bank, and its branches, shall be ineligible, who have served three 
 years in succession, not embracing the Government directors." 
 
 This motion was not carried . 
 
 This bill being under consideration in Senate, 12th March, 1822, Mr. 
 FINDLAY moved to amend the bill, by the addition of the fol lowing section: 
 
 *' And be it enacted, That so much of the second rule of the eleventh sec- 
 tion of the act, entitled " An act to incorporate the subscribers to the Bank of 
 the United States," as provides that no director shall hold his office more than 
 three years out of four in succession, and so much of the 14th rule as pro- 
 vides that no director of an oilice of discount and deposite shall hold his office 
 more than three years out of four in succession, be, and the same is hereby, 
 repealed." 
 
 This amendment was rejected by a large majority. 
 
 Mr. TALBOT moved the indefinite postponement of the bill: this motion was 
 negatived . 
 
 Mr. PLEASANTS then moved to strike out the second section of the bill; but 
 this motion was, after debate, lost, by the casting vote of the chairman, (Mr. 
 DIOKERSON) the votes being 19 for, and 19 against the motion. 
 
 Mr. EATON moved an amendment to the second section, providing that 
 " the court before whom the conviction shall take place, shall have power to 
 enter a judgment against, the party for the amount or value of the thing so 
 fraudulently converted," &c. 
 
 The amendment was lost. 
 
 MARCH 14, 1822. 
 
 Mr. WILLIAMS, of Tennessee, offered an amendment to the first section, 
 going to require of the bank to make all its notes, of and under ten dollars, 
 payable at the principal bank, or any of its branches. 
 
 This proposition was supported by the mover, and by Mr. TALBOT, and was 
 opposed by Mr. OTIS, and Mr. KING, of New York. After an ineffectual 
 attempt by Mr. VAN DYKE, to limit the operation of the amendment to five 
 dollar bills, the question was taken on the amendment, and the same was 
 agreed tojby the following vote: 
 
 AYES. Messrs. Barb our, Barton, Brown, of Ohio, Chandler, Elliott, Gaillard, John- 
 son, of Kentucky, King-, of Alabama, Lanman, Lloyd, Macon, Noble, Palmer, Plea- 
 sants, Rugg-les, Smith, Talbot, Taylor, Thomas, Walker, Ware, and Williams, of 
 Tennessee, 22. 
 
 NOES. Messrs. Boardman, D'Wolf, Dickerson, Eaton, Findlay, Holmes, of Maine, 
 Holmes, of Miss. Johnston, of Louisiana, King 1 , of New York, Knig-ht, Lowrie, Mills, 
 Otis, Parrott, Seymour, Southard, Stokes, Van Dyke, and Williams, of Miss. 19. 
 
 Mr. HOLMES, of Maine, moved an amendment, requiring the bank, within 
 six months, to accept all, or relinquish all the provisions of the first section: 
 but this motion was afterwards withdrawn by the mover. 
 
ttAKLESTOX MEMORIAL. 325 
 
 Mr. BARBOUR moved to strike out the first section of the bill, together with 
 \\ieprovi80, making all notes of, and under, ten dollars, p'ayable at the bank, 
 or cither of the branches. 
 
 After debate, the motion to strike out was decided in the affirmative, as 
 follows: 
 
 AVKS. Messrs. Barbour, Benton, Brown, of Ohio, Chandler, D'Wolf, Eaton, 
 Holmes, of Miss. Knight, Lanman, Lloyd, Macon, Mills, Palmer, Parrott, Pleasants, 
 Uug-g-les, Seymour, Smith, Talbot, Taylor, Thomas, Van Dyke, and Williams, of 
 Miss. 23. 
 
 XIIES. Messrs. Barton, Brown, of Lou. Dickerson, Edwards, Elliott, Findlay, 
 Holmes, of Maine, Johnson, of Kentucky, Johnston, of Lou, King-, of Alabama, King', 
 of New York, Lowrie, Merrill, Noble, Southard, Stokes, Walker, Ware, and Wil- 
 liams, of Tennessee. 19. 
 
 The remaining section v.as then ordered to be engrossed, and read a third 
 time. 
 
 The bill, as amended, was afterwards pissed, and sent to the Hou.-o of Re- 
 presentath 
 
 IN THE HOUSK, the bill was referred to the Commitiee on the Judiciary, who 
 were di>chared from the consideration of it. and it was afterwards referred 
 to a select committee, to whom the memorial of the president and directors of 
 the bank had been referred; but it does not appear that any action of the 
 House took place on it during the session. 
 
 JANUAKY -JO, 18-23. 
 
 Mr. HAMILTON, of S. ('.. piv-i-nied a memorial of sundry banking institu- 
 tions, insurance companies, and individuals, of Charleston, S. G., which is as 
 follows: 
 
 To the Honorable the Hoaxc of Representatives oj' the U. S. of America: 
 Your petitioners, interested in the commercial prosperity of the United 
 States, and of South Carolina in particular, having learnt, from the proceed- 
 ings of the stockholders of the Bank of the United States, that a petition would 
 again be presented to your honorable body, praying for an alteration in their 
 charter, by which that bank ami its offices would be released from the obli- 
 uation of receiving in payment of all dues to the Government the notes of all 
 the different offices of the said Bank of the United State*, in whatever part 
 of the Union such office may be located, respectfully pray that such petition 
 may be granted. 
 
 Your petitioners are perfectly satisfied, if the notes of each office of the 
 Bank of the United States were made receivable only at such office, and 
 thereby confined in their circulation to the State in which they were issued, 
 and to those parts of the adjoining States more immediately connected with 
 it ill commerce, that very great benefits would result to the different banking 
 institutions in particular, and to the community in general. The offices 
 would then issue their notes on precisely the same principles and in the same 
 proportions as the State banks, and their business would be conducted ac 
 cording to their several capitals, on terms of perfect reciprocity. The rates 
 of exchange would then become more uniform and moderate, by an increase 
 of competitors in regular exchange operations. The different moneyed insti- 
 tutions and the community would be relieved from the exactions which they 
 occasionally feel, and of which they are always apprehensive. Good will 
 would exist towards an institution very capable of, and even now affording 
 great advantages to, the Government, and harmony would be restored be- 
 tween it and every part of the community. 
 CHARLESTON-, November, 18-2-2. 
 
 [On the 17th December, 1823, a copy of this memorial was again presented, 
 by Mr. POINSETT, and referred to the Committee of Ways and Means, upon 
 which no report was made.] 
 
326 APPENDIX, 
 
 Ordered* That the said petition be referred to Mr. Hemphill, Mr. Cam- 
 breleng, Mr. Mercer, Mr. Mallary, and Mr. M'Kim- 
 
 JANUARY 28, 1823. 
 
 Mr. HEMPHILL (by leave of the House) presented a memorial of the presi- 
 dent and directors of the Bank of the United States, on the part of the stock- 
 holders of the said bank, stating certain grievances under which they labor, 
 arising from defects and omissions in the act for their own incorporation; 
 which memorial was referred to the said committee. 
 
 FEBRUARY 27. 
 
 Mr. HEMPHILL, from the said committee, made the following report: 
 The committee, to which were referred the memorial from several banking 
 institutions, and insurance companies, in the State of South Carolina, and 
 the memorial from the President and Directors of the Bank of the United 
 States, praying for certain laws to be passed in relation to the bank, and 
 for certain alterations to be made in the charter, report: 
 
 That the memorials claim the interposition of Congress in four particulars: 
 
 1. To change that part of the charter which provides that no director, ex- 
 cept the president, shall be eligible for more than three years in four. 
 
 2. To provide, by law, for the punishment of persons who may be convicted 
 of practising fraud on the bank. 
 
 3. To authorize the board to appoint one or more persons to sign notes of 
 the smaller denominations at the parent bank. 
 
 4. To pass a law by which the notes of the bank shall only be receivable, 
 in payments to the United States, at the bank or branch where they are made 
 payable. 
 
 As to the first, there are many inconveniences which arise from the short 
 duration which is allowed to a directorship; but the committee are not in- 
 clined at present to make the change prayed for. 
 
 As to the second, the committee report in favor of it, to the fullest extent 
 prayed for, and think that salutary penal laws ought immediately to be passed 
 on the subject. 
 
 As to the third, the committee think it is reasonable, and that it ought to be 
 granted. The almost constant manual labor of signing notes must too much 
 exhaust the two principal officers of the bank, and, in a greater or less de- 
 gree, disqualify them from a due application of their minds to the extensive, 
 critical, and important concerns of the bank. 
 
 As to the fourth, the committee are obliged t9 go into some detail upon it. 
 If the arrangement prayed for would be beneficial to the bank, and not inju- 
 rious to the Government, nor to local banks, nor to the community at large, 
 it ought to be granted; but more especially ought it to be granted, if it will 
 not only be beneficial to the bank, but productive of public good. 
 
 Under the 14th section of the act incorporating the bank, the bills or notes 
 of the bank, originally made payable, or which shall have become payable on 
 demand, are made receivable in all payments to the United States, unless 
 otherwise directed by act of Congress. 
 
 It will be observed, in the first instance, that no alteration of the charter in 
 relation to this provision is prayed for. It will 1 also be observed, that the act 
 incorporating the bank did not consider this arrangement as unalterable; it 
 was to undergo the test of time and experience; on the one hand, Congress 
 reserved the power to change this provision whenever the public good should 
 require it, and, on the other, the stockholders had every reason to expect 
 that, if this provision should distress the bank, that Congress would remove 
 it, if, by doing so, no disadvantage would accrue to the Government. The 
 question now, after a fair and full experiment on the subject, is, whether this 
 provision is judicious or otherwise; and we can only arrive at the truth of 
 this inquiry by comparing the consequences of this provision with that state 
 of things which will most probably exist if it should be removed. 
 
CHARLESTON MEMORIAL. 327 
 
 The bank is to place the funds of the Government at any given point, and 
 it is the duty of the bank, as far as possible, to preserve a sound currency in 
 the country; the bank is not bound to pay its notes, presented by the Govern- 
 ment, except where the notes are payable: but as it is bound to transfer the 
 funds, little time only could be gained by refusing to pay them wherever re- 
 ceived, and that refusal, perhaps, would be attended with inconvenience to 
 the Government, and accordingly the bank pays the notes wherever received, 
 without reference to the places where they are payable; the result is at times 
 embarrassing to the bank. The practical effect of the provision under con- 
 sideration, will be more clearly perceived, by attending to the usual course of 
 business, and to the state of exchange. The exchanges between the West and 
 Atlantic, have always been against the former. The exchanges between the 
 North and the South, are, for one portion of the year, against the latter, and 
 for another, in its favor. When the exchanges are unfavorable to the South 
 and West, the notes of the Southern and Western branches are taken to the 
 North, to pay the balance of debt; they are equal to cash, without the expense 
 of transfer, as they are receivable in payment of duties to the Government. 
 To give the best view of this part of the subject, the committee will incorpo- 
 rate a part of the report of the committee of the bank, presented to Congress 
 in the session of 1820. 
 
 Speaking of the branch notes, it says, " they are equal to cash, or very nearly 
 so, in all the principal cities north of the Potomac. They are so because they 
 are receivable in payment of duties to the Government, the portion of which, 
 payable to the north of the Potomac, in any quarter of the fiscal year of 1819, 
 was, taking that year as an example, nearly as much as the whole circulation 
 of the Bank of the United States at the same time, and of course kept up a 
 steady demand for the notes of the Southern and Western branches. 7 he 
 union of this demand with the course of exchanges, draws the whole of the 
 notes of the Western offices to the Atlantic, and, at particular seasons of the 
 year, the greater part of the notes of the Southern offices to the North. The 
 revenue collected to the South being comparatively small, there can never be 
 any material reflux of their notes, because they will be absorbed by the north- 
 ern demand before the exchanges turn, and the balance of payments being 
 always against the West, there is never anyj towards that quarter. We will 
 now proceed to enumerate some of the evils resulting from the receipt of the 
 notes of the bank and its branches in this manner and under these circum- 
 stances. 
 
 " 1st. It greatly deranges and distresses the money market, both of the 
 places where the notes are received, and where they are payable. 7'he bank 
 at Philadelphia and the offices at New York and Boston, did not receive less 
 than between five and six millions of the notes of the offices south and west 
 of them, in the short period of fourteen months, exclusive of the notes of the 
 office at Washington. These points were obliged to pay the Government the 
 amount of these notes, and in vain sought for speedy reimbursement from the 
 offices where they were payable. The state of the exchanges which caused 
 this flux of their notes, created an inability to reimburse the offices which had 
 received them, until the exchanges turned. 7'he offices receiving them were 
 of necessity obliged to curtail their business suddenly, to provide the means 
 of paying them. Accordingly, the curtailments at Philadelphia, New York, 
 ana Boston, within the same period, amounted to upwards of four and a half 
 millions of dollars, and exhausted almost the whole of the capital placed at 
 these points. The capital of New York and Boston, united, was at some 
 periods less than nothing. What distress and embarrassment must have beer 
 caused by these circumstances, will easily be conceived by those who hav< 
 reflected on the nature and effects of the sudden withdrawal of a large portioi 
 of the active capital of a trading community. 
 
 '' The evil suffered in the community where the notes were thus receive 
 and paid, was not all. 7'he offices whose notes were thus received and paid 
 were necessarily called upon to provide the means of reimbursement, and 
 curtailments to a corresponding amount were ordered in them, and lilr* A: 
 
828 APPENDIX. 
 
 tress and embarrassment produced in the communities where they were lo- 
 cated. Double the amount of the notes thus circulated was in this way with- 
 drawn from use to provide for their payment. The aggregate curtailments in 
 the fourteen months before alluded to, (from 1st September, 1818, to 1st No- 
 vember, 1819,) were upwards of lO.j millions of dollars, and it is confidently 
 believed it would not have been necessary to have reduced the discounts of 
 the bank a single cent, but for this cause. When these reductions com- 
 menced, the discounts were very moderate for the capital of the bank. They 
 did not amount to $42,000,000. 
 
 " Nor is the extent of the distress and embarrassment measured by the 
 immediate effects of the reduction of the discounts of the bank and its branches. 
 These reductions, in their operation, throw back upon the State banks a por- 
 tion of their circulation, and reduce their deposites, and they also are obliged 
 to curtail their business, and add to the general mass of distress. 
 
 " The uncertain liability of the bank and its branches, as each is in a cer- 
 tain degree liable to pay the notes of all the rest, and the perpetual alteration 
 of the capital of each, by paying the notes of the others, and having its notes 
 paid by them, put it beyond the power of calculation to determine the extent 
 of business which can be safely done, and leaves the bank to vacillate be- 
 tween the hazards of rashness, and the fruitless results of a torpid prudence. 
 To day, a branch shall have a million of capital, and in three months it may 
 be without a cent. 
 
 " 2. It diminishes and deranges the currency of (he whole country. The 
 bank was under the necessity, to protect itself from danger, and to avoid 
 charging itself to an unlimited amount with the cost of adverse exchanges, to 
 forbid the offices with which the exchanges were unfavorable to issue their 
 notes. It, however, issued its own notes, and the offices against which the 
 exchanges did not run, issued their notes without any limit but that of the 
 demand; yet the circulation of the bank was by this cause greatly decreased. 
 Thus, for example, in the short space of five months, from the 1st April, 1819, 
 to the 30th August, 1819, it was reduced from $6,045,428 to $3,838,386. 
 
 <fc This, however, does not shew the entire extent of the abstraction from 
 the currency, which this cause produces. Let it be supposed that the circu- 
 lation of the bank is four millions of dollars, and that one-half of it has been 
 issued by offices to the South and West, and it is in use for the purposes of 
 being remitted to the North and East. It is, thereby, as much taken out of the 
 currency as if it were destroyed; and it leaves only two millions of currency 
 furnished by Ihe bank. But, the bank will, probably, have four millions of 
 specie in its vaults, and it cannot safely have less under these peculiar cir- 
 cumstances; this sum, also, is withdrawn from circulation. Thus, the bank, 
 not by its fault, but by the necessity which is imposed upon it, has withdrawn 
 jfour millions of specie from the currency, and has given a substitute, in its 
 notes, only to the amount of two millions. In this view, the currency has 
 been diminished two millions. But even this is not the worst view of it. Let 
 us suppose, that the notes of the bank and its branches could not be converted 
 into bills of exchange, and there is no doubt, it is presumed, that, with its 
 high credit, it could easily do what many local banks have accomplished. It 
 could circulate t\yo dollars of its bills for every dollar it should have in its 
 vaults. Then, it is supposed to have four millions of dollars in its vaults, 
 and could circulate eight millions of its notes, which would be equal to gold 
 and silver. It then would have added four millions to the currency, while, 
 at present, it diminishes it to the amount of two millions, making a practical 
 difference of no less than six millions in the sound currency of the country. 
 The view may even be extended, because the Bank of the United States 
 
 decreasing currency. In the words of a great man, " poverty, and beggary, 
 and sloth, follow in its train." 
 
REPORT ON MEMORIALS. $29 
 
 "But this evil of a decreasing currency will not occur as a rare calamity, 
 once, perhaps, in a century, but will be renewed with every flux and reflux 
 of the exchanges between the different portions of the country, as long as the 
 bills of the Bank of the United States are thus receivable by the Government. 
 "3d. It makes the necessary public burthens, in some instances, doubly 
 oppressive. In all the States south of Virginia, and in nearly, if not all, the 
 Western States, the Government of the United States does not expend half 
 the revenue it collects; the surplus must be remitted toother points, where it 
 is necessarily to be expended. This draws so much of the capital of those 
 States from 'them, and adds it to the capital of another New York, for ex- 
 ample. This is not a subject of complaint, though it is certainly an evil; but, 
 when the revenue of New York is collected in the notes of the offices of the 
 South and West, perhaps to an equal amount, and drawn from the necessary 
 currency of these portions of the country, the evil produced by the remittance 
 of the surplus revenue becomes intolerable, because the means of making it 
 have been taken away. The capital of these States is fettered by the neces- 
 sary curtailments of their banks, their currency is diminished, and that state 
 of things which is called a scarcity of money, is produced, exchange rises, 
 and when the revenue is to be remitted, the means of doing it no longer 
 e\ist>." 
 
 As bank notes represent specie, such a relationship should be maintained 
 between them, as to enable a given amount of specie to .sustain as large a pa- 
 per circulation as could be instantly converted into specie; but this can never 
 be accomplished while specie must be provided at so many different places for 
 the payment of the same note; the uncertainty of the places where the notes 
 will be presented lor payment, must at all times confound the most discreet 
 calculation for the maintenance of a proper relation between the specie and 
 paper circulation. To the Government, it can be of no advantage, as debts 
 must be paid to the Government where due, and its funds, the bank is obliged 
 to transfer from place to place, at the pleasure of Government. 
 
 In the opinion of the Secretary of the Treasury, in his report to the second 
 session of the 16th Congress, the alteration would be beneficial to the com- 
 munity. It is as follows: 
 
 4 * Preliminary to a resort to internal taxation of any kind, the charter of the 
 Bank of the United States ought to be amended, so as to make the bills of all 
 the offices of the bank, except that at the seat of Government, receivable only 
 in the States where they are made payable, and in the States and territories 
 where no office is established. The effect of this modification would be, to 
 make the notes of the offices of the Bank of the United States, except the 
 office in this district, a local currency, which will enter and continue in the 
 local circulation of the States in which they are issued. The notes, thus issued, 
 will render the local circulation of the States sound, and furnish to the citi- 
 zens the means of discharging their contributions to the Government. 
 
 "This measure will also place the State institutions, to the south and west 
 of this city, in a more eligible situation, in relation to the offices of the Bank 
 of the United States, by enabling them to adjust their accounts with these offi- 
 ces by the exchange of notes, instead of liquidating their balances by the pay- 
 ment of specie." 
 
 To the portions of the country where the balance of trade is generally un- 
 favorable, it must be injurious, as it deprives them of every benefit which the 
 sound currency of the Bank of the United States is capable of affording to 
 them; the bank, in such places, for its own defence, being obliged entirely to 
 suspend the issuing of notes. 
 
 To the portions of the country where the exchange is at intervals unfavora- 
 ble, it is injurious, because it occasions an unprofitable and distressing fluc- 
 tuation in the paper circulation of the place: for, in proportion to the disap- 
 pearance of branch notes, must inevitably follow curtailments, not only of the 
 branch, but of the local banks. The Southern banks sensibly feel the effects 
 of this vacillating and disordered state of things; and their memorial con- 
 - *hp. following remarks on the subject: That u they are perfectly satisfied, 
 
$30 APPENDIX. 
 
 if the notes of each office of the Bank of the United States were made re- 
 ceivable only at such office, and thereby confined in their circulation to the 
 State in which they were issued, and to those parts of the adjacent States 
 more immediately connected with it in commerce, that very great benefits 
 would result to the different banking institutions in particular, and to the com- 
 munity in general. 
 
 " The offices would then issue their notes on precisely the same principles, 
 and in the same proportions, as the State banks; and their business would be 
 conducted, according to their several capitals, on terms of perfect reciprocity; 
 the rates of exchange would then become more uniform and moderate, by an 
 increase of competitors in regular exchange operations. The different money- 
 ed institutions, and the community, would be relieved from the exactions 
 which they occasionally feel, and of which they are always apprehensive. 
 Good will would exist towards an institution, very capable of even now af- 
 fording great advantages to the Government; and harmony won Id be restored 
 between it and every part of the community." 
 
 The regulation, as it now exists, operates as a practical prohibition to issue 
 any notes in the Western States, and to a like prohibition to issue them to 
 the South, during six months in the year; while the collection of the revenue, 
 and the convenience of the People, in these quarters of the Union, require 
 them to be issued continually. , 
 
 To simplify the case, let any given district be selected, where there is no 
 sound currency, and where no notes of the Bank of the United States can, 
 at present, be issued, for the reasons already given. 
 
 If the notes, when issued, could only be receivable at the office issuing 
 them, their circulation would be limited. The office, for its own benefit, must 
 do business; the notes of solvent individuals would be discounted, and a 
 sound paper would be put in circulation, which could not leave the boundary 
 which practice would prescribe for it. The holders of branch notes could 
 demand silver whenever wanted for transportation, and the expense of this 
 transfer, as in the ordinary cases of trade, would soon bring business to a safe 
 and proper level; and some sound standard among the local banks would fol- 
 low as a necessary consequence. 
 
 The same reasoning would, in part, apply to places where exchanges fluc- 
 tuate. At present the branch notes are often unnaturally taken from the 
 places at which they are wanted, and carried to places where they are not 
 wanted. 
 
 If the desired arrangement was effected, the bank would be enabled to put 
 into circulation a much larger quantity of sound paper than at present; by 
 which the bank, and the Government, being the owner of one-fifth of the stock, 
 would be greatly benefitted; and, from its operation, it is believed that the 
 community at large would enjoy real advantages. 
 
 What substantial reason can be given for an adherence to this provision of 
 the law? 
 
 In what manner does it produce any public good? 
 
 Its operation on exchange is ineffectual. 
 
 In reference to any two given places, when the balance of trade is against 
 the one, gold and silver there, will be of less value than at the other, by the 
 expense of transportation; and the exchange will always be about equal to this 
 expense. The nature of trade will keep this balance alternating, and it may 
 be, generally, against one place in a certain direction, while, at the same time, 
 it is in its favor in another direction; but the design of making paper circula- 
 tion for the purpose of exchange better than the specie it represents, appears to 
 be in a great degree fallacious. The bank can never equalize exchange; the 
 expense of exchange must be borne by the debtors, in the debtor part of the 
 country, and every attempt to give a different direction to it, will be baffled. 
 It is alien to the inflexible laws of trade, and cannot be realized. 
 
 Indeed, if the branch notes can be drawn directly from the office, they will, 
 of course, be free of the usual expense of exchange; but this rarely happens; 
 the real debtor who uses them as exchange, has generally to pay to the money 
 
MOTION FOR A SALE OF U. S. BANK STOCK. 
 
 dealers a premium higher than a just premium on exchange in its accustomed 
 form. 
 
 The Southern institutions, and the most respectable citizens in Charleston, 
 who are materially interested, and who have witnessed the effect produced in 
 practice, have informed us, in their memorial, that the business of exchange 
 will be improved, and the exchange itself moderated. 
 
 There are exceptions, which, perhaps, it will be proper to make. 
 
 The notes of the parent bank may be receivable at any of the branches. 
 
 The notes of the office at Washington might be receivable at the parent bank 
 and the branches, and, for the convenience of travellers, the five dollar bills? 
 of the bank ought to be receivable every where, and all the notes of the bank 
 and its branches may be received in the States and Territories where the bank 
 ; ias no establishment. 
 
 Ai it is no part of the charter, the law can be repealed at the pleasure of 
 Congress; ana, to guard it, in the most effectual manner, let the law, for the 
 sake of an experiment, be limited to two years; it will then require a re-enact- 
 ment, which cannot be procured, unless its utility shall have been proved by 
 experience. 
 
 There are but few considerations that are more momentous than that which 
 relates to the currency of the country; and it belongs to the Bank of the 
 ' 'nited States, as far as possible, to preserve its soundness. It is an institu- 
 tion that is entitled to a patient and calm hearing; its advantages to the coun- 
 try have been great, v/hile its sufferings are but too well known. Errors, if 
 any have been committed, it is hoped experience will correct; prejudices, if 
 any existed, it is hoped have now subsided, and that reason alone will, in the 
 end, prevail. 
 
 The following resolution is offered: 
 
 Itexolucd, That the Committee on the Bank of the United States be in- 
 structed to prepare and bring in a bill agreeable to the above report 
 
 No such bill, however, was brought in. 
 
 The same memorial was, on the 27th of January, 1823, presented in the 
 SKXATE, by Mr. Findley, and referred to the Committee on Finance, who were 
 discharged from the consideration thereof. Nothing farther was done in that 
 body during the session. 
 
 HOUSE OF REPRESENTATIVES, December , 1826. 
 On motion of Mr. McLANE, 
 
 Ordered, That the petition of the president, directors, and company, of the 
 Bank of the United States, heretofore presented on the 28th of January, 1823, 
 be referred to the Committee of Ways and Means. 
 
 No report appears to have been made by that committee. 
 
 DECEMBER 13^, 1827. 
 
 Mr. PHILIP P. BARBOUR submitted the following resolution: 
 " Resolved, That the Committee of Ways and Means be directed to report 
 a bill for the sale of that portion of the stock of the Bank of the United States 
 which is held by the Government of the United States, and the application of 
 the proceeds thereof to the payment of the public debt." 
 
 On motion of Mr. GORHAM, said resolution was ordered to lie on the table. 
 
 On the 20th of December, the said resolution was again considered in the 
 House, and debated. 
 
 On the 2 1st December, after further debate, a motion was made by Mr. 
 RANDOLPH, that the resolution do lie on the table; which was decided in the 
 negative: Yeas 79, Nays 107. 
 
 The said resolution was thereupon disagreed to by the House: Yeas 9, 
 Nays 174. 
 
APPENDIX. 
 
 the renewal of the Charter of 1310. 
 
 Soon after the meeting of the present Congress, memorials were presented 
 by the bank to both Houses, praying a renewal of their charter. These were 
 referredin the Senate, to a Select Committee; in the House, to the Com- 
 mittee of Ways and Means. This latter committee, on the 9th of February, 
 1832, made a report favorable to the application, and accompanied it by 
 " A bill to renew and modify the charter of the Bank of the United States. 5 ' 
 
 The provisions of this bill are, briefly, as follows: 
 
 SEC. 1. That the charter be continued in force for the period of twenty 
 years from the 3d day of March, 1836, w-ith a power reserved to Congress to 
 repeal it at any time after ten years, upon giving three years' notice to the 
 bank. 
 
 SEC. 2. That the* President of the United States have power to appoint one 
 of the directors of each branch of the bank, as he now does a portion of those 
 of the principal bank. 
 
 SEC. 3. That any of the officers of the mother bank who may be designated 
 by the Secretary of the Treasury, shall have power to sign and countersign 
 the notes and bills. 
 
 SEC. 4. That the bank be prohibited from issuing any notes except such as 
 are payable at the office from which they are issued; and also, from drawing 
 checks or drafts of twenty dollars or any less amount. 
 
 SEC. 5. A list to be furnished annually to each State, of the stockholders 
 residing therein, with the amount of their stock; and the States to have the 
 power of taxing it as they do that of their own banks. 
 
 SEC. 6. The bank to pay to the United States interest at the rate of 
 
 per cent, upon Government deposites. 
 
 SEC. 7. Bank not to establish any additional branch thereof without the 
 consent of Congress. 
 
 Upon this bill no action has yet taken place. 
 
 THE END. 
 
INDEX. 
 
 pa JP 
 
 dkton, Willis, of N. C., his speech against renewal of charter in 1811, . 190 
 
 Ames, Mr., of Mass., his speech in favor of bill of 1791, - - 45 
 
 Amendments Mr. Swoope's to bill to renew charter, moved 20th April, 1810, 134 
 
 Mr. Love's, - - 134 
 
 Various to Fisk's bill, in 1814, - 526-529 
 
 Anderson, Joseph, of Tenn., in Senate, moves to strike out the first section of 
 
 bill to renew the charter, - - 302 
 
 dyes and Noex In Senate, on bill of 1791, - - 36 
 
 In the House, on same, - - 85 
 
 In the House, on the postponement of the bill to renew charter in 1811, 274 
 
 In Senate, on the motion to strike out the first section of bill renewing 
 
 the old charter, 446 
 On the resolution declaring that it is expedient to establish a national 
 
 bank, with branches, in 1814, . 486 
 
 On engrossing Mr. Fisk's bill, 28th November, 1814, - 534 
 
 On section requiring bank to lend to Government, - 530 
 
 In Senate, 5th December, 1814, on motion to reduce capital, - 548 
 
 On Mr. King's bill, in Senate, 9th December, 1814, - 548 
 
 On the third reading, in House, of Mr. King's bill, - 560 
 
 In House, on passage of Mr. K's bill, - - 570 
 
 On reducing capital from fifty to thirty millions, - - 577 
 
 On the passage of the bill, 7th January, 1815, in the House, - 579 
 
 In Senate, on suspension of specie payments, - 585 
 
 In Senate, on bill, after President's veto, - 596 
 
 on Harbour's bill, - 605 
 
 In House, on indefinite postponement of bill, - 608 
 
 on appointment of directors by President, - 679 
 
 on engrossment of bill, - 680 
 
 on its passage, - - 681 
 
 In Senate, on passage of bill, 3d April, 1816, - 706 
 
 In House, on indefinite postponement of the bill, - - - 712 
 
 Bank of North America.- Proceedings on the institution of, 11, 12 
 
 Ordinance of incorporation of^ - - - 12 
 
 Utility of said bank, - - - 25 
 
 Bank of the. United States: Plan of, submitted by Hamilton, . ^.31 
 
 Kill to incorporate, introduced into the Senate, - . 35 
 
 Bill passed the Senate, - - 36 
 
 First reading of the bill in the House, - - - - 36 
 
 Passed the House, . . g5 
 
 Resolution calling for names of stockholders of, - - . 133 
 
 Do. for list of directors of, &c. - . 138 
 In 1811, apply for a temporary continuation of their powers their pray- 
 
 er denied, . . 447-8 
 
 Barbour, Mr., of Va. , reports to Senate a bill to incorporate a bank, &c. - 596 
 
 Speech on Mr. Mason's motion respecting specie, - . 687 
 
 Barry, W. T., of Ken., his speech against renewal of the charter, in 1811, - 211 
 
 Bibb, Mr., of Geo., remarks on payments of specie on each share of stock, - 685 
 
 Bill to incorporate subscribers to the old bank, (see Bank of U. S.) 
 
 Presented to, and signed by, the President, - - - 85 
 
 In extenso, reported 2d April, 1810, to establish a bank, - - 122 
 
 To continue in force the act of Feb. 1791, introduced by Mr. Taylor, - 132 
 
 Bill to renew charter of 1791, introduced into the House by Mr. Burwell, 137 
 
 postponed indefinitely, . . 274 
 
 In Senate, reported by Mr. Crawford, 1811, - - - 300 
 
 Rejected, - . . . . - 446 
 
 To repeal the tenth section of the old charter, - - . 447 
 
 Reported, to establish a bank in Washington, - - . 473 
 [This bill was not acted on.] 
 
800 INDEX. 
 
 Page. 
 
 Bill reported by Committee of Ways and Means, 487 
 
 Same bill as amended in Committee of the Whole, - 519 
 
 Rejected, on motion for engrossing 1 , - . 534 
 
 Reported by Mr. King-, of Senate, 2d December, 1814, - 539 
 
 Passed the Senate, - . 549 
 
 Rejected in the House, by Speaker's vote, - 570 
 
 Vote reconsidered, - - . 574 
 
 Recommitted to Select Committee, - - 576 
 
 Passed the House, - .... 579 
 
 Copy of, as passed by the two Houses, - - 585 
 
 Reported in Senate, by Mr. Barbour, - . 596 
 
 Passed the Senate, - . 605 
 Reported by Mr. Calhoun, in House, - -621 
 
 Committee of the Whole to the House, - 668 
 
 Ordered to be engrossed ayes and noes, - 680 
 
 Passed the House, - - - - - - 681 
 
 Passed the Senate, 3d April, 1816, 706 
 
 Bonus, Bank: Mr. Troup moves to strike out of the bill to renew the charter the 
 
 clause requiring- a bonus to be paid for the renewal, - 135 
 Debate on said motion, 467-471 
 
 Motion to apply it to internal improvement of the country, - 675 
 
 Books of Bank: May be inspected by a committee of Congress, - - 706 
 
 Ordered to be inspected by a committee, - 714 
 
 Boudinot, Mr., of N. J., his speech in favor of old bank, - 56 
 
 Boyd, Mr., of N. J., opposed to a renewal of charter in 1811 his speech, - 204 
 
 Bradbury, Mr., of Mass., his motion respecting- subscriptions in Government 
 
 stock, and debate on motion, . . . . . 492 
 
 Branches of Bank: Proviso moved, that they should not be established with- 
 out the consent of the States, - - 678 
 
 Brent, Mr., of Va., advocates, in the Senate, the renewal of the charter, though 
 
 instructed by the Legislature of Virginia to vote against it, . 393 
 
 His second speech on the same subject, . . . 426 
 
 Burwell, Mr., of Va., introduces a bill to renew charter of 1791, . . 137 
 Moves to strike out first section, . . . .138 
 His speech on said motion, . . . . .139 
 
 * Calhoun, J. C., of S. C., outline of his plan of a bank, as detailed in debate, 
 
 16th November, 1814, . , . . .495 
 
 Moves to divest the Government of all share in the proposed bank, &c. 496 
 - His motion carried, . . . . .513 
 
 Moves to strike out the section of the bill authorizing- the U. S. to sub- 
 scribe twenty millions in six per cent, stock to the capital of bank, . 514 
 This motion debated and carried, . . . 514-517 
 
 Bill reported by him 8th January, 1815, . . .621 
 
 His speech on presenting the bill, .... 630 
 
 Capital of Bank: Motion of Mr. Gaston to reduce from fifty to twenty millions, 531 
 Motion by Mr. Lowndes to reduce, .... 533 
 
 Do. Mr. Mason, in Senate, to reduce, . . . 548 
 
 Mr. Sergeant's motion to reduce thirty-five to twenty millions, , 638 
 
 negatived, . . . 653 
 
 Clause of bill allowing prospective increase of capital, struck out, . 653 
 
 "Casting vote of the Vice President defeats bill to renew the old charter, . 446 
 
 V^ of Speaker, defeats bill reported by Mr. King, 
 
 Cheves, Mr., of S, C-, (Speaker) gives casting vote against Mr. King's bill, . 571 
 Clay, Henry, of Ken., opposed to renewal of the charter of old bank in 1811, . 353 
 His speech in favor of bill of 1816, . . . .669 
 
 Clinton, George, Vice President, gives a casting vote on motion to strike out 1st 
 
 section of bill to renew the charter, and defeats the bill, . . 446 
 
 Clapton, Mr., of Va,, moves, 23d December, 1814, to strike out the first sec- 
 tion of bill from Senate * to incorporate," &c. his speech, . . 549 
 Columbia, District of, committee to inquire into the expediency of establishing a 
 
 bank in, .... 472 
 
INDEX. 301 
 
 Page. 
 
 Columbia, Bill reported to establish a bank in, . . 473 
 
 Committee.- In Congress of 1 780, to confer on the subject of a bank, . 9 
 
 In Congress of 1781, on same subject, . . . .10 
 
 Of the Whole House to have charge of Hamilton's report in 1 79 1 , . 15 
 In Senate, on said report, . . . . .35 
 
 On petition for renewal of charter, 16th December, 1810, . , 135 
 Of Senate, ask the opinion of the Secretary of the Treasury, as to the 
 
 renewal of bank charter, ..... 300 
 
 Of Ways and Means report ag-ainst power of Congress to incorporate a 
 
 bank, . . . . 472 
 
 Of Ways and Means directed to inquire iuto the expediency of establish- 
 ing 1 a bank within the District of Columbia, , . . 472 
 Report a bill for that purpose, . . . 473 
 On motion of Mr. Grundy to determine the expediency of establishing a 
 
 bank, . . . . . ' , 475-480 
 
 Of the Whole House, 24th October, 1814, report that it is expedient to 
 
 establish a bank, ..... 484 
 
 Of Ways and Means report a bill fora bank, . . . 487 
 
 On National Currency, 6th December, 1815, . . . 609 
 
 Of Congress may inspect books, &c. of bank, . . . 706 
 
 Appointed to inspect books and make report, . . , 714 
 
 Report of, appointed by Congress, .... 714 
 
 of Committee of Ways and Means, (Mr. McDuffie's) . . 735 
 
 Condict, Mr., of N. J., moves to locate the bank at New York, . . 675 
 
 Constitutional power to create a bank denied to Congress, . . 472 
 
 Opinions of various gentlemen upon the question, in 1814, . . 484-5 
 
 Courts: Bank may "sue and be sued" in State courts, . . . 675 
 
 Crawford, Mr., of Pa., his speech in opposition to a renewal of charter, . 269 
 Crawford, W. H , of Geo., reports a bill to the Senate to renew the charter of 
 
 1791, . . .... 300 
 
 His speech ou the motion to strike out the first section of the bilJ, . 303 
 
 Second speech on the same subject, . . . 434 
 Cuthbert, Mr. of Geo., opposed the motion of Mr. Sergeant to reduce capital 
 
 his speech, . . .... 649 
 
 Dallas, (Secretary) letter to Committee of Ways and Means in 1814, upon a 
 
 bank, - . ... 481 
 
 letter to Mr. Lowndes, (Chairman,) .... 535 
 
 his proposition relative to bank, .... 609 
 
 his letter to Secretary of Treasury, with plan of bank, - 613 
 
 Dana, Mr. of Con. on the amount to be paid in specie, on each share of stock, 691 
 
 DEBATES on the bill of 1791, - "37-85 
 
 Speech of Mr. Madison, - - 39, 82 
 
 Mr. Ames, - 45 
 
 Mr. Sedgwick, 50 
 
 Mr. Lawrence, 53 
 
 Mr. Jackson, 54 
 
 Mr. Boudinot, 56 
 
 Mr. Smith, of S. C., - 63 
 
 Mr. Stone, - . 64 
 
 Mr. Giles, 69 
 
 Mr. Gerry, - 75 
 
 Mr. Vining, - 81 
 
 On bill to renew charter of 1791, in the House. 
 
 Speech of Mr. Burwell, .... 139 
 
 Mr. Fisk, ofN. Y. 149-160 
 
 Mr. Seybert, - - 160-166 
 
 Mr. P.'B. Porter, 166-180 
 
 Mr. Desha, - 181-186 
 
 Mr. Pickman, - . 186-190 
 
 Mr. W. Alston, . 190-193 
 101 
 
\ 
 
 INDKX. 
 
 Delates.- Speech of Mr. Key, 
 
 Mr. Wright, 
 
 Mr. Boyd, 
 
 Mr. McKee. 
 
 Mr. Barry, 
 
 Mr, Findley, 
 
 Mr. McKim, 
 
 Mr. Gold, 
 
 Mr. Johnson, 
 
 Mr. Sheffey, 
 
 Mr. Garland, 
 
 Mr. Tallmadge, 
 
 Mr. Nicholson, 
 
 Mr. Crawford, of Pa. 
 
 Mr. Rhea. of Ten. 
 
 Mr. Eppes, of Va. 
 
 Mr. Stanley, ofN. C. 
 
 Mr. Taylor, of S. C. in 1810, 
 
 In the Senate. 
 
 On bill to renew the charter in 1811. 
 Speech of Mr.jlCrawford, of Georgia, 
 Mr. Leib, of Pa. 
 Mr. Lloyd, of Mass. 
 Mr. Giles, of Va. 
 Mr. Clay, of Ken. 
 Mr. Pope, of Ken. 
 Mr. Smith, of Md; 
 Mr. Brent, of Va. 
 Mr. Taylor, of S. C. 
 Mr. Pickering, of Mass. 
 Mr. Love, of Va. 
 Mr. Findley, 
 Mr. Troup, 
 
 Pag?. 
 
 193-196 
 
 197-264 
 
 204 
 
 206, 295 
 
 - 211 
 
 - 215 
 
 - 219 
 
 - 223 
 
 - 226 
 
 - 235 
 
 - 248 
 . 252 
 
 - 257 
 . 269 
 . 275 
 
 - 282 
 . 286 
 
 - 457 
 
 303, 434 
 
 - 315 
 
 - 317 
 
 - 329 
 
 - 352 
 360, 393 
 
 - 374 
 393, 426 
 
 - 410 
 
 - 420 
 
 - 451 
 462 
 469 
 
 On Mr. Grundy's motion for an inquiry into the expediency of a 
 
 bank, - - 475-480 
 
 On Mr. Gaston's motion to reduce capital of bank from sixty to 
 
 twenty millions, 15th Nov. 1814, . 490 
 
 Speech of Mr. Ingham of Pa., 17th November, 1814, 498-506 
 
 Mr. Ingersoll, of Pa. on Mr, Calhoun's motion to amend 
 
 the bill, - . 506 
 
 On motion to strike out section of bill allowing United States to sub- 
 
 scribe twenty millions, - - 514-517 
 
 Speech of Mr. Clopton, of Va. on Mr. King's bill, . 549 
 
 Mr. Webster, 2d January, 1815, - . 563 
 
 Mr. Calhoun, on bill of 1816, . . - 630 
 
 Mr. Calhoun's bill, in House, . - 630 
 
 Messrs. Randolph, Ward, Sergeant, Calhoun, Pitkin, 634-5 
 
 Speech of Mr. Smith, on motion to reduce capital, - 636 
 
 Mr. Sergeant on same motion, - 638 
 
 Remarks of Mr. Ward, of Mass. - 641 
 
 Speech of Mr. Tucker, of Va. on same motion, - 642 
 
 Mr. Webster on same, > - - . - 646 
 
 Mr. Cuthbert, of Geo. - . 649 
 
 Mr. Hopkinson, - - 650 
 
 Mr. Sharpe, of Ken. - 651 
 
 Debate on, to strike out clause, allowing Government to subscribe 
 
 seven millions by Mr. Cady, Mr. Calhoun, Mr. Randolph, 
 
 Mr. Smith, of Md., Mr. Wright, Mr. Jewett, Mr. Ross, and 
 
 Mr. Goldsborough, 653-658 
 
INDEX. 
 
 Page. 
 
 Debate on motion to strike out the clause giving- to the President and Se- 
 nate the appointment of a part of the Directors, - 661 
 on this motion by Mr. Forsyth, and Mr. Telfair, 662-666 
 Speech of Mr. Clay in favor of bill of 1816, - .669 
 in Senate on motion that specie payments be ten instead of five dol- 
 lars on each share; by Mr. Mason, Mr. King, Mr. Mr. Bibb, Mr. 
 Barbour, Mr. Dana, Mr. Taylor, and Mr. Sanford , 683-692 
 Speech of Mr. Wells, of Del., in Senate against bill, - - 694 
 On Mr. Randolph's motion to postpone the bill; by Messrs. Cal- 
 houn, Grosvenor, Randolph, Webster, Hurlbut, Wright, 
 McKee, Sheffey, and others, 707-71 2 
 in 1819, on resolution repeal of charter, referred to, . 734 
 Deposites, in United States' Bank, motion to repeal part of an act directing 
 
 them, - -180 
 
 Desha, Mr. of Ken. his speech against the renewal of charter in 1811, - 181 
 
 Directors of Sank, motion to strike out clause giving to President and Senate 
 
 the appointment of - 661 
 
 Motion to strike out clause which confined appointment of to those no- 
 minated by President of United States, . 666 
 Of appointment of President from, 666, 667 
 Proposal to allow those appointed by Government a salary, made and ne- 
 gatived, 676, 677 
 Motion, as to appointment of, by President, renewed, . . 678 
 Mr. King moves to strike out power of appointment by the President, 693 
 Mr. Goldsboruugh makes the same motion, on contingency of a sale of 
 
 United States' stock . . . .694 
 
 Dividends of the U. S. Sank from 1792 to to 1809, . 117-120 
 
 Eppes, Mr. of Va. denies the expediency of renewing the Bank charter^ his 
 
 speech, . . . .282 
 
 Expediency of a bank declared by a resolution, . 484-486 
 
 Findley, Mr. ofPenn. advocates the renewal of charter in 1811; his speech, 215 
 his speech on Mr. Taylor's bill, .... 462 
 
 Fisk, Mr. of New York, speech of, on motion to strike out'first section of bill to 
 
 renew charter in 1811, . . . ' . 149 
 
 speech of, on motion to reduce capital of bank, . . . 490 
 
 Forfeiture of Charter. Committee of the Whole had amended the bill, so as to 
 make this the penalty of a non-payment of notes by bank on motion 
 of Mr. Wright, this amendment was struck out in the House, 673 
 
 Gallatin, Albert, reports in favor of a bank, . . .116 
 
 his opinion of its utility, . . . . jjg 
 
 his letter to a Committee of Senate upon the uses of a bank, 300 
 
 Garland, Mr. ofVa. moves postponement of bill to renew, 196 
 
 advocates renewal of charter; his speech, . . 248 
 
 Gaston, Mr. of N. C. his views respecting Fisk's bill, in 1814, . 499 
 
 moves to reduce capital from fifty to twenty millions, . 490, 53 1 
 
 his motion negatived, 15th November, 1814, . , ' 493 
 
 his remarks in relation to Mr. King's bill, . , . 55-7 
 
 Gerry, Mr. of Mass, for the old bank-; his speech, . . 75 
 
 Giles, of Va. opposed to the bill of 1791, his speech, . . 69 
 
 and to renewal of charter in 1811, . . * 339 
 
 his opinion upon legislative instructions, . . 343 
 
 Gold, Mr. ofN. Y. advocates the renewal of the charter; his speech, in 1811, 223 
 
 Grundy, Mr. ofTenn. moves the appointment of a committee to inquire into 
 
 the expediency of establishing a National Bank, . . 475 
 
 Hall, Mr. of Georgia, moves a reconsideration of bill rejected by Speaker's 
 
 vote > ... 571 
 
 moves to apply bonus of bank to internal improvement of the country, 675 
 
804 INDEX. 
 
 Hamilton, Alexander, proposes the establishment of a National Bank, and sub- 
 mits a plan thereof, . . . . .15 
 his report to Congress on the subject of a bank, . . 15-35 
 his argument on the constitutionality of the bill, . . . 95-112 
 his opinion upon the time the President may retain a bill before it be- 
 comes a law, . . . . . .113 
 
 Hophinson, Mr. of Pa. speaks in favor of a reduction of capital, . . 650 
 
 Ingham, Mr. of Pa. his speech on Mr. Calhoun's motion,, 16th November, 1814, 
 to amend the bill, and to allow subscriptions to be one-tenthin specie, 
 and nine-tenths in Treasury notes, .... 498 
 
 Instructions, Legislative. Quere, whether binding 1 upon Senators Mr. Brent's 
 
 opinion thereon, ..... 394 
 
 Mr. Pickering's observations upon, .... 420 
 
 Interest on notes not paid on demand, 20 per cent., proposed by Mr. Randolph, 673 
 
 Internal Improvement , proposition for applying- profits of banks, to purposes 
 
 of, &c. ..... 120, 121 
 
 motion, to apply bank bonus to, . . . , . 675 
 
 Jackson, Mr. of Georgia, opposes the bill of 1791, . . .54 
 
 Jackson, (President) extract from his first message in regard to bank, 734 
 Jefferson, Thomas, gives his opinion to Washington against the constitutionality 
 
 of the bank bill, . ... 91 
 
 Johnson, Mr. of Ken. opposes the renewal of the charter in 181 1; his speech, 226 
 Johnson, Mr. of Fa. moves a resolution for the repeal of the bank charter, 
 
 Judicial Decisions. . . , . . 781 
 
 Jurisdiction, whether Congress can give, to State courts, 675 
 
 Key, Philip Barton, of Md. his speech in favor of a renewal of charter in 1811, 193 
 his remarks on power to incorporate a bank . . 469-470 
 
 Kilbourn, Mr. of Ohio, proposes a plan of a bank, . . . 538- 
 
 King, Mr. of N. Y. reports* in Senate, a bill to incorporate a Bank of United 
 
 States, 2d December, 1814, .. . . . 539' 
 
 proposes sundry amendments to bill, . . . 548-549 
 
 his remarks on payments of specie, . . 664 
 
 Lawrence, Mr. his remarks in favor of the bill of 1791, . 53" 
 
 Legislative Instructions, various opinions upon, . ' 394, 343, 420- 
 
 Leib, Mr. of Pa. opposed to renewal of charter, . 315 
 
 Loans, clause in bill requiring bank to make loans to Government struck out, 529 
 motion in Senate, to strike out clause requiring forced loans, . 605 
 
 Location of Bank, motion to substitute Washington in place of Philadelphia, for 
 
 parent bank, ... . 659 
 
 New York proposed, and carried,, .... 676 
 
 vote in favor of New York reconsidered, and reversed, . 677 
 
 Lloyd, Mr. of Mass, in favor of renewal of charter; his speech on motion to 
 
 strike out first section of the bill to renew, . .317 
 
 Love, Mr. of Fa. introduces resolutions that the Secretary of the Treasury fur- 
 nish the names and titles of stockholders of the bank, the number of 
 shares voted on, &c. and also his data for the statement of the dividends 
 in 1809, with other information, 
 
 for a statement of the debts and concerns of the bank, 19th Dec. 1810, 135 
 his speech on bill to renew the charter, 451 
 
 Lowndes, Mr. of S. C. his views of bill reported in 1814, by Committee of Ways 
 
 and Means, . . . . 51 6 r 518, 526, 532 
 
 moves to reduce capital of bank, 533 
 
 Madison, Mr. his speech in opposition to the first bank bill; denies its constitu- 
 tionality and expediency, . 
 
 his second speech on same subject, . , 
 
 his veto on bill passed by both Houses, 
 extract from his message, 5th December, 1815, . 
 his letters to Mr. Ingersoll 778 
 
INDEX. 8Q5 
 
 Page. 
 Marshall, Chief Justice, his opinion in the case of M'Culloch vs. The State of 
 
 Maryland, . 782 
 Mason, Mr. of N. H. moves, in Senate, that the specie payment on shares of 
 
 stock be ten instead of Jive dollars, .... 683 
 
 debate on this motion, . 683, 692 
 moves the reservation of a power to repeal the act in case of suspension 
 
 of specie payments, &c. ... . 705 
 
 Memorial of Bank, for renewal of charter, presented in House, 26th Mar. 1808, 115 
 
 same in Senate, 20th April, 1808, . . .115 
 
 to the Senate, presented 18th December, 1810, . 300 
 
 referred to a Select Committee, . . 460,451 
 
 petition of inhabitants of New^York for a national bank, . 472-480 
 
 of citizens of New York for a bank, . 539 
 
 M'Duffie, Mr. of 8. C. his report on subject of bank made in 1830, . 735 
 
 M'Kee, Mr. of Km. in favor of renewing- the old charter his speech, . 206 
 
 his second speech on same subject, . . . 295 
 
 M'Kim, Mr. of Md. opposes the renewal of the charter in 1811 his speech, 219 
 
 M'Lean, Mr. of Ken. moves a proviso, that no branch shall be established in a 
 
 State without the consent thereof, .... 678 
 
 Morris, Robert, submits plan of a bank, . . . 11 
 
 Morris, Gouverneur, agency in forming Bank of North America, . 14 
 
 Motions of Mr. Burwell, to strike out first section of bill to renew charter, 138 
 
 by Mr. Newton, to postpone indefinitely the bill to renew the oldcharter, 196 
 of Mr. Grundy, for appointment of a committee to inquire into the expe- 
 diency of establishing- a bank, and debate on said motion, 475-480 
 
 to locate bank at Washington, negatived, . . 489 
 by Mr. Calhoun, to deprive the Government of all stock in bank, and 
 
 respecting payment in specie, . 496 
 
 Mr. Ingham's speech on that motion, .... 498 
 to reduce capital from 50 to 20 millions, . , .531 
 
 same motion by Mr. Mason, in Senate, . . . 548 
 to amend, so as to give Congress the power to declare the charter void, 
 
 in certain cases, ..... 530 
 
 by Mr. Webster, to recommit bill, with certain instructions to committee, 562 
 
 motion negatived, .... 570 
 
 by Mr. Sergeant, to reduce capital, .... 635 
 
 negutived, .... 653 
 
 to strike out clause allowing 1 Government to subscribe seven millions, 653 
 
 to exclude the Government from the appointment of directors of bank, 661 
 
 motion neg-atived, ..... 666 
 
 by Mr. Randolph, to impose an interest of 20 per cent, upon notes not 
 
 paid on demand, ..... 673 
 
 motion negatived, . . 674 
 
 Mr. Mason's on specie payments, . . . 683 
 
 for a repeal of charter, in certain cases, . . 693 
 
 New York, motion to locate the bank at . . 675 
 
 " " " " carried, . . 676 
 
 vote for, reconsidered, and reversed, .... 677 
 Nicftolson, Mr. of N. Y. speaks in favor of the bill for a renewal of the charter 
 
 of 1791, . ... 257 
 
 North America, Bank of, instituted . . . . 10-14 
 
 utility of this bank, . . . .25 
 
 Opinion of E. Randolph, Attorney General, given to Washington, on the consti- 
 tutionality of the first act of incorporation, . . 86-89 
 of Th. Jefferson, Secretary of State, against the bank, . .91 
 of A. Hamilton, in support of bill, . . 95-112 
 of A. Gallatin, of the advantages of a bank. . . .118 
 of President Jackson, in regard to bank, . . . 734 
 of Chief Justice Marshall, . ... 782 
 
806 INDEX. 
 
 Pickering, Mr. of Mass, in Senate, urges a renewal of the old charter, . 420 
 
 Pickman, Mr. of Mass., speaks in favor of a renewal of charter in 1811, . 186 
 
 Pitkin, Mr. of Conn., in committee of the whole, moves to strike out the clause 
 
 allowing' the Government to appoint directors, . . .661 
 
 renews his motion in the House. .... 678 
 
 Plan of Bank of North America, . . . .11 
 
 of old Bank of United States, embraced in Hamilton's report, . 31 
 
 Mr. Calhoun's, in 1814, ..... 495 
 
 by Mr. Kilbourn, of Ohio, ..... 538 
 
 Outline of Mr. King's bill, in 1814, . . . 549-558 
 
 by Secretary Dallas, with letter, . . . 613-619 
 
 Pope, Mr. of Ken, urges a renewal of charter his speech, . . 360 
 
 in explanation, after Mr. Smith, of Md. . . 393 
 
 Porter, P. B. ofN. Y. his speech against renewal of charter in 1811, . 166 
 
 Postponement. Mr. Wells moves postponement of bill to next session his 
 
 speech, . . . . 694 
 
 President of United States, (Madison) his veto message on bank bill, 30th Janu- 
 ary, 1815, . . . . .594 
 
 Extract from his message, (Mr. Madison's) in 1815, . . 609 
 
 " from General Jackson's to 21st Congress, . . 734 
 
 Proceedings, in the old Congress, on the incorporation of the Bank of North 
 
 America, . . . . . .10 
 
 in Senate, on the first Bank of United States, . , 35, 36 
 
 in the House and Senate, in 1808, on memorial for renewal of charter, 115 
 in Senate, on motion to strike out the 1st section of bill to renew the old 
 
 charter, ...... 302 
 
 in Senate, on Mr. King's bill, . . . 539-585 
 
 Randolph, Attorney General: His argument against the constitutionality of the 
 first bank bill, ...... 86-89 
 
 Randolph, Mr., of Va. his opinion of the currency, . . . 634 
 
 His speech upon striking out clause allowing the Government to hold 
 
 stock, . . ... 654 
 
 On penalty for non-payment of notes, .... 674 
 
 Moves the indefinite postponement of bill, . . 707 
 
 Reconsideration of vote on Mr. King's bill, moved, . . .571 
 
 debate on said motion, .... 572-574 
 
 motion carried. ... ... 574 
 
 Reference: Debate on reference of bill to establish a bank to be located in 
 
 Washington, '..... 473 
 Motion to refer bill to select committee negatived, . 604 
 
 Renewal of charter, solicited in 1808, . . .115 
 
 Proceedings thereon in House and Senate, . . .115 
 
 Petition of stockholders for, 18th December, 1810, . 135 
 
 Bill for, presented by Mr. Taylor, . .132 
 
 Do. do. Mr. Burwell, . . .137 
 
 Bill for, in House, postponed, .... 274 
 
 in Senate, . . . . , .446 
 
 Repeal of charter: Motion that, in case of non-payment of bills and notes, Con- 
 gress may effect a, ..... 693 
 This motion renewed and negatived, .... 705 
 Moved by Mr. Johnson, of Va., February 9, 1819, . . 734 
 Report of Alexander Hamilton, Secretary of the Treasury, recommending the 
 
 establishment of a bank, . . . .15 
 
 of Secretary of the Treasury (Gallatin) on the subject of a bank, made 
 
 to Senate, 3d March, 1809, . .116 
 
 of Select Committee on the memorial of bank for a renewal of charter, 
 
 29th January, 1810, . . . . 121 
 
 Report, of committee on Mr. Love's resolution declaring it expedient to esta- 
 blish a bank, . . 122 
 Gallatin's, of affairs of bank, 3d January, 1811, . . .136 
 
INDEX. 307 
 
 Report of Committee of Ways and Means, denying- power of Congress to esta- 
 blish a bank, .... 472 
 
 of committee under Mr. Spencer's resolution, . . .714 
 
 of Committee of Ways and Means, (McDuifie's) . , . 735 
 
 in Senate, of Mr. Smith, of Md., .... 772 
 
 Resolutions in old Congress, approving of the plan of a bank, . 10, 11 
 
 of Mr. Nicholas for a " general national establishment of banks through- 
 out the United States," . . . . .120 
 
 Love's, of 4th April, 1810, asking names and titles of stockholders, &c. 132 
 for a list of directors of bank and stock held by foreigners, by Mr. 
 
 Wright, . . . . . .138 
 
 by Mr. Love, to repeal an act directing deposites to be made in the Unit- 
 ed States' Bank, . . . . . .180 
 
 of the State of Virginia, instructing members to oppose renewal of the 
 
 charter, ...... 299 
 
 by Mr. Webster, to recommit bill with certain instructions, . . 562 
 
 Rhea, Mr. of Ten., his speech in opposition to the renewal of the charter, in 181 1, 275 
 Root, Mr. ofN. Y., moves that six per cent. United States' stock be subscriba- 
 
 ble at_ninety per cent. . . . 660-675 
 
 Sedgwick, Mr., of Mass, his speech in favor of bill of 1791, . . 50 
 
 Sergeant, Mr., of Pa,, moves to reduce capital of the proposed bank from thir- 
 ty-five to twenty millions, ..... 635 
 His speech in support of the motion, .... 638 
 Seybert, Mr., of Pa., his speech in 1811, on motion to strike out the first sec- 
 tion of bill to renew charter, . . . . .160 
 Scire facias: Provision for issuing of, against bank, . , 588-9 
 Resolution submitted ordering a, . 732 
 Sharpe, Mr., of Ken., moves to refer bill to a select committee, with certain in- 
 structions, 13th February, 1815, . . . .606 
 opposed to a reduction of capital his speech, , . , 651 
 Shares, Bank: Motion to make them one instead of Jive hundred dollars, . 492 
 of the specie to be paid on each, .... 683 
 Sheffey, Mr., of Va , urged the renewal of the charter in 1811 his speech, . 235 
 Smith, Mr., of S. C., speech in favor of the old bank, . . .63 
 Smith, Mr., of Md-, opposes the renewal of the charter his speech on motion 
 
 to strike out first section, ..... 374 
 Speech on Sergeant's motion to reduce capital, . . . 636 
 
 His report in 1830, on bank, . . . . .773 
 
 Smilie, Mr., of Pa., presented a resolution of t.h* Legislature of that State in- 
 structing her members to vote ag-alnsc renewal of charter of 1 79 1 , . 247 
 Specie.- Motion to make notes payable in, at branches, . .561 
 payments propositions for suspension of, . . 581-2 
 Senate refuse to allow suspension of, . . 585 
 Motion to strike out clause dispensing with payments of, . . 605 
 to pay ten instead of five dollars per share, , . . 650 
 Clause allowing suspension of payments of, struck out, , . 668 
 Motion that ten dollars of, be paid on each share, . . 683 
 Spencer, Mr., of N. Y,, moves the appointment of a committee to inspect the 
 books of bank, and report whether the provisions of the charter had 
 been violated, &c. . . . . ,714 
 His report made in 1819, ..... 714 
 Speeches: See "Debates," 
 
 Stanley, Mr., of N, C-, in favor of renewal of charter, . . . 286 
 
 States.- Motion that books for subscription be so opened that stock should be 
 
 distributed in proportion of representation of, , , . 693 
 
 Statement of affairs of United States' Bank in 1 809, . .117 
 
 Do madeinlSll, . . . .136 
 
 Stock of Sank: Motion by Mr. Wright, of Md., for an apportionment of it 
 
 among the States, &c. , . . . . .489 
 
 Government: Propositions as to the terms on which it might be subscribed, 
 
 as part capital to the bank, .... 493 
 
808 TNDEX - 
 
 Page. 
 
 Stock t Government) Motion that it be subscribed at ninety per cent. 660, 676 
 
 Stone, Mr* of Md,, against the bill his speech, . . .64 
 
 Supplementary acts, under the old charter, . 1 14 
 
 Tallmadgc, Mr. of Conn, in favor of renewal, . . 252 
 
 Taylor, Mr. of S. C. in favor of the renewal of the bank charter; his speech in 
 
 the Senate thereon, . . . . .410 
 
 reports a bill to renew the charter, . . .132 
 
 his speech, in the House, on said bill, . . . 457 
 
 on amount to be paid in specie, , . ,691 
 
 Taylor, Mr. of N. Y. reports a bill to establish a bank, . . 473 
 
 Treasury, Secretary of, (A. Hamilton) his report upon a National Bank, with a 
 
 plan thereof, . . . .' . .15 
 
 his opinion to Washington upon the constitutionality of the bill to esta- 
 blish it, . . . . . .95 
 
 (A. Gallatin) his report upon a bank, . . .116 
 
 his letter to a committee of the Senate, upon the utility of a 
 bank, . ., ... 300 
 
 Letter of Secretary Dallas, to Committee of Ways and Means, 17th Oc- 
 tober, 1814, in regard to currency and a bank 5 . . 481 
 Letter of Mr. Dallas to Mr. Lowndes, 27th November, 1814, . 535 
 proposition of, relative to currency and bank, . 609 
 Dallas's letter to Committee on currency, with plan of bank, December, 
 
 1815, , . 613-619 
 
 Treasury Notes, subscriptions to bank, not payable in, . , 660 
 
 Trimble, Mr. of Ken. his resolution for a sciere foci as against the bank, . 732 
 
 Troup, Mr. of Georgia, moves to strike out clause requiring payment of a bonus 
 
 by thebank, in 1810, ..... 135 
 
 his remarks on that motion, .... 467-469 
 
 his motion rejected, . . . . .471 
 
 Tucker, Mr. of Fa. opposes Mr. Sergeant's motion for reducing capital of 
 
 bank his speech, , . 642 
 
 United States, motion to strike out clause of bill allowing them to subscribe seven 
 
 millions, ,...,, 653 
 
 motion negatived, ..... 658 
 
 stocks of, at what rate subscribable, .... 660 
 
 r V: Madison to bank bill, 30th January, 1815, . . .594 
 
 Fining, Mr. of Del in favor of *,!<! bank his speech, . . .81 
 
 Virginia instructs her members to oppose renewal of charter, . , 299 
 
 Washington, his note to Hamilton, requiring his opinion on bank bill. . 94 
 
 asks the opinion of Hamilton as to the time he may retain a bill presented 
 
 for his approbation, . , . . .113 
 
 City of, motion to locate bank there, . , . 473, 489, 659 
 
 Ward, Mr. of Mass, on motion to reduce capital, . . . 641 
 
 Ways and Means, report of Committee of, on part of President Jackson's mts- 
 
 sage relating to the Bank, (Mr. M'Duffie, chairman) . . 735 
 
 Webster, Mr. ofN. H. his views of bill reported *by Committee of Ways and 
 
 Means, 15th November, 1814, . . . .531 
 
 moves sundry resolutions, 29th December, 1814, by way of amendment 
 
 to bill, . . , . , .562 
 
 his speech in support of resolutions, . , . 563-569 
 
 his motion to recommit bill, negatived, . . . 570 
 
 speech on Mr. Sergeant's motion to reduce capital, . . 646 
 
 Wells, Mr. of Del. his speech, in Senate, against the passage of bill of 1816, 694 
 
 Wright, Mr. of Md. speaks in opposition to a renewal of the charter of the old 
 
 bank, , .197 
 
 in favor of a capital of forty-five millions, . , . 677 
 
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