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 incorrect, 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 following 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, heretofore 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 commenced paying 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 Government 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, generally, 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. reasons, also, why the plan of a bank now before the House, did not meet He assigned the his approbation.

Mr. HAWKINS, Mr. WRIGHT, Mr. RHEA, of Tenn. 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 follows:

For commitment,

Against it,

75,

80.

Mr. GASTON then moved to refer the bill to a committee of the whole; which motion was decided in the negative.

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 following vote:

For the motion,
Against it,

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,
Against it,

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 moment was a most unfavorable one for the establishment of a bank. It must be known that, long as the subject of a bank had been agitated, there had been important differences of sentiment as to the principles of such an institution, 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 hope 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 valuable 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 postponed.

Mr. GASTON Conceived there would be less difficulty in acting on this subject 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 individuals 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.

Mr. GROSVENOR, Mr. WRIGHT, Mr. PICKERING, and Mr. FARROW, advocated 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,

CHAPTER V.

PROCEEDINGS AND DEBATES ON THE GRANT OF THE CHARTER OF 1816.

14TH CONGRESS, HOUSE OF REPRESENTATIVES.

1st Session.

DECEMBER 5, 1815.

Extract from the annual message of JAMES MADISON, President of the United States.

war.

"The arrangements of the finances, with a view to the receipts and expenditures of a permanent peace establishment, will necessarily enter into the deliberations of Congress during the present session. It is true, that the improved condition of the public revenue will not only afford the means of maintaining the faith of the Government with its creditors inviolate, and of prosecuting successfully the measures of the most liberal policy, but will also justify an immediate alleviation of the burdens imposed by the necessities of the 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 devolves 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 required as an instrument of credit) shall be issued, upon motives of general policy, 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 Treasury, 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 suggestions 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 presenting it, therefore, to the consideration of Congress, there is occasion for an implicit reliance upon the legislative indulgence.

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 credit; 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, consisting 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 exception of Spanish milled dollars, and parts of such dollars) to be a legal tender for the payment of debts and demands, in the year 1809.+

The constitutional authority to emit bills of credit, has also been exercised in 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 services of the late war, have been endowed 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 legal 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 of 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 Government 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 affected by the various circumstances 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 national coin, is alone competent to create a national substitute. It has happened, however, that the coin of the United States has ceased to be the circulating medium of exchange, and that no substitute has hitherto been provided by the national authority. During the last year, the principal banks established 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 constitutionally emit bills of credit, corporations, erected by the several States, have been enabled to circulate a paper medium, subject to many of the practical inconveniences of the prohibited bills of credit.

It is not intended, upon this occasion, to condemn, generally, the suspension 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 originally induced, and perhaps justified the conduct of the banks, has passed away, and the continuance of the suspension of specie payments, must be ascribed 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.

† See 2 vol. 37, 120, 158, 161: 3 vol. 7, 221, 316: 4 vol. 62, 375, 395.

See 2 vol. 161: 4 vol. 62: 8 vol. 66.