Henry Clay, June 3, 1841:---
There is no concealment, no mystery intended. I will tell the honorable Senator, [Mr. Calhoun] at once, and with all frankness, what I go for, and what I believe my friends who act with me mean to go for ? and that is a Bank of the United States. That is the object in view.
Abraham Lincoln, March 1, 1843:---
"a national bank is highly necessary and proper to the establishment and maintenance of a sound currency, and for the cheap and safe collection, keeping, and disbursing of the public revenue."
Daniel Webster, March 12, 1838:---
as the steed will, sometimes, throw himself against its enclosures, break away from its confinement, and, feeling now free, betake himself to the moors and barrens
they beseech the poor to make war upon the rich
they complain of oppression, speculation, and the pernicious influence of accumulated wealth
they cry out loudly against all banks and corporations
they carry on a mad hostility against all established institutions
they would move heaven and earth against privilege and monopoly
they rend the air with the shouting of agrarian doctrines
History of the Bank war
Tuesday, January 16, 1838,Appendix to the Congressional Globe, text of Senator Benton's speech
Senator Wright reported A Bill imposing additional duties as depositories, in certain cases, on public officers ...
debate opens on January 30th 1838. ---war is better than Sub-Treasury, says Henry Clay; on June 21, 1838, he will say pestilence, femine, war are preferable to Sub-Treasury
Congressional Globe , March 14, 1838---
Mr. Buchanan said he had a very sincere desire to bring the debate on the Sub-Treasury bill to a close, and however reluctant he might feel to throw any obstacle in the way of the measure then under discussion, he should move to lay the bill on the table or pass it over informally. Mr. Buchanan said, if he could do nothing else in the business, he should hereafter move, when the hour came for the special order to be discussed, to move to lay all other business on the table.
Mr. Lyon hoped it would be passed over informally, which was accordingly done.
The Independent Treasury Bill was then taken up; when,
Mr. Robbins rose, and addressed the Senate until half past two against the bill, and was followed by Mr. Benton, who occupied the floor until five o'clock, when he gave way for a motion to adjourn.
Speech of Senator Thomas Hart Benton,
in the Senate, Wednesday, March 14, 1838.
Mr. Benton commenced his speech with remarking upon the different manners in which the discussion of the bill had been conducted on the different sides of the House. The chairman of the Finance Committe, [Mr. Wright,] who had reported the bill, and opened the debate, had done it in a most business like manner; his luminous and masterly exposition of principles and details being entirely confined to the subject, and never once deviating into extrinsic matter, or touching upon any topic of party, or partisan character. Not so the speeches of the Opposition Senators. From the very beginning they launched into the ocean of party politics, and made the bill the occasion for a general attack upon the Republican Administrations of General Jackson and Mr. Van Buren, such as we have been accustomed to see for a long time on this floor. The debate has been conducted by them as an attack upon a party, and as a contest for power, and not as an inquiry into the merits of the bill. The speeches they have delivered have been such as might be expected at the partisan encounters of the hustings, on the stump, or at barbecue dinners, in the course of an electioneering campaign for an elective office, and not such as would be looked for in the parliamentary discussion of a legislative measure.
In this attack it has been assumed for granted that the country has been ruined by, what is called, the mad and wicked administration of General Jackson; and that President Van Buren being pledged to carry out his line of policy, is of course pledged to go on ruining the country, and therefore ought to be resisted and overthrown. I propose to inquire into the truth of these assumptions, and to ascertain, first, how far it is true that the country has, in point of fact, been ruined; next, how far this ruin, if any, has been the work of General Jackson's administration; and, after settling these preliminary points, I shall have something to say on the merits of the bill, and something on the peculiar system of party warfare of which this Senate has been the scene for the last six years.
In making my inquiries into the ruin of the country, I am not left to grapple with vague generalities and pointless declamation. Fortunately for me, the Opposition orators have descended to specifications, and have shown wherein this ruin have been perpetrated. Their specifications embrace almost every branch of foreign or domestic policy; and, taking the era of the second Mr. Adams's administration, when themselves were in power, and their cherished national bank was in its meridian --taking this period as the culminating point of our America's prosperity, felicity, and renown, they trace a rapid descent, from that high point of national pre-eminence, down the steep road to destruction, until the entire nation is landed in total perdition in the year of our Lord, 1837. They have given us specifications, but there they stop. No proof, no statistics, no statements, no comparative tables, accompany their specifications to establish their truth. Bold assertion, and terrifying descriptions, occupy the place of proof. These fierce denunciators assume the prerogative of genius; they assume to be independent of facts and of reasons; and they rely upon flights of fancy, dashes of imagination, and fierceness of invective, to supply the place of proof and argument. I have no pretension to this prerogative. I am a plain speaker, and tell what I know, and then prove it. Reversing then the method of our opponents, I shall discard altogether the painted and gilded creations of the imagination, and shall confine myself to the effective logic of facts and figures.
At the head of the specifications of gentlemen, is the article of commerce, both foreign and domestic, each asserted to have been prostrated and sacrificed by the fatal policy of General Jackson's administration. We will test the truth of this bold assertion; and for that purpose will have recourse to data which no gentleman will be at liberty to question. And, first, of domestic commerce. The great West shall be our first field of inquiry, and, casting the eye over the broad expanse of that magnificent region, we see two points at which the commerce of the upper half of the valley of the Mississippi is subjected to a process which allows it to be annually, and easily, counted and compared. These points are, the Louisville canal for the commerce of the Ohio, and the port of St. Louis, for the commerce of the Upper Missippi. Referring to the evidence obtained at these two points, and we have exact accounts of the commerce in the two largest sections of the West, and data for estimating the condition of the remainder. In each instance the statement goes back seven years, that is to say, to the second year of General Jackson's administration, and comes down to the first year of Mr. Van Buren's. For the Louisville canal, the official return stands thus:
Mr. Benton read over this table, and then commented upon some parts of it. The increase in the number of steamboats which passed the canal had in creased four-fold in seven years; and the year of ruin --1837-- had presented as large an increase as any preceding one had done. But the number of steamboats was not the most correct criterion; the tonnage is more accurate, especially as it includes flats and keel boats; and, tested by the tonnage, it will be seen that the increase was three-fold in seven years, and that the year of ruin presented an increase of 60,000 tons over that of the preceding year. So much for the prostration of commerce on the Ohio river, and in Kentucky itself, in this black year of perdition and destruction !
The commerce of the port of St. Louis was the second test to which Mr. Benton subjected the domestic commerce of the country. St. Louis was a port of entry by law, and a port of destination by position for nearly all the boats which entered it. It was not merely a touching or stopping point for boats bound elsewhere, but was a port of destination for the delivery of cargoes, and the reception of lading. I have the statement of its steamboat commerce for seven years; and this is the result:
Mr. Benton remarked upon this exhibit as corresponding wonderfully with that of the Louisville canal, and showing an increase of nearly four fold in the commerce of St. Louis, under the impracticable and outlandish administration, as it was called, of General Jackson, and a large increase in the year of ruin over that of any preceding year --even the bloated year of 1836. The arriving and departing tonnage for the year 1837, was 450,821 tons, the far greater part of it being the growth of seven years, and that not only without banks, but upon the loss of one --the loss of the United States Branch Bank, which wound up after the veto of 1832; and from which time the commerce of the city advanced with gigantic strides, and established itself upon foundations too solid to be overthrown by any convulsion.
The foreign commerce of some of the principal seaports, next claimed the attention of Mr. Benton. He took the ports of Boston, New York, Philadelphia, Baltimore, Charleston, and New Orleans, as presenting leading points in the different sections of the Union, and compared the imports in those cities during the administration of Mr. [J.Q.] Adams, when the Federal party and the Federal bank were in full power, with those, not of 1836, which was a year of bloat and over-action, but with the year of ruin --1837-- when the absurd, impracticable, and outlandish measures of the mad and wicked administration of the Republicans had produced the full measure of their fatal destruction. He presented a table, compiled for him at the Treasury Department, and read it.
Remarking upon this table, Mr. Benton said that, the year of ruin presented an increase of business in every port except that of Philadelphia, far exceeding the proportionate increase of population. Taking the last year of Mr. [J.Q.] Adams's administration, as the one most favorable to the Opposition, and it would be seen that, at Boston, the increase of importations was five millions of dollars in value; in New York, the increase was thirty-seven millions; in Baltimore, above two millions; in Charleston, more than double; in New Orleans, doubled, and a million and a half over. Philadelphia, the seat of the great bank, was the only place that exhibited a decline: all the rest exhibited a vast improvement, and the further off from the Philadelphia protector the better. The case of Charleston was particularly striking. The commerce of that city regularly declined from year to year, under the withering influence of the high tariff policy, during the administration of Mr. [J.Q.] Adams, and the presence of a branch bank of the great regulator. It declined for four years; then rapidly recovered under the administration of General Jackson; and, in the year of ruin was double the amount of the last year of Mr. Adams's time.
Mr. Benton referred to the exports, and imports of specie, to show the farther superiority of the year of ruin over the finest year of Mr. [J.Q.] Adams's administration, or even the whole of it put together. His averment was, that the gain on the import of specie, over the exports, was, for the year 1837, four millions and a quarter of dollars, while, for the whole four years of Mr. Adams's administration, the gain was but one million. On these points he exhibited these tables:
Imports ......... Exports
1825 .... $6,150,130 ... $8,797,955
1826 ..... 6,880,960 .... 4,704,553
1827 ..... 8,152,130 .... 8,014,880
1828 ..... 7,489,741 .... 8,243,476
Making a total of about 30 millions and a half of imports, and about 29 millions and a half of exports. The same test for the year of ruin, exhibited $10,964,432 for the imports, and $6,714,000 for the exports.
Pursuing the tests of the comparative prosperity of the two periods, Mr. Benton came to the sales of the public lands, which stood thus:
1825 ........ $1,205,068
1826 ......... 1,128,617
1827 ......... 1,318,105
1828 ......... 1,221,357
1837 ......... 7,004,538
Here again the year of ruin appears, said Mr. Benton, in victorious contrast with the whole period of Mr. Adams's administration. The sales of the single year are equal to six years of such sales as occurred from 1825 to 1828. The sales in Indiana alone, during this year of ruin, exceeded the sales of the best year in Mr. Adams's time, for they amount to $1,565,390. The same may nearly be said of Illinois, where the sales for 1837 amount to $1,266,775. The whole of these sales were for hard money; for the Treasury order was in full operation during the whole year. The entire sum of seven millions was received in specie, and the one half of it after the banks had suspended payment. This fact was the fullest vindication of that order. It showed the error of all the caculations which were made upon the effect of that order. It showed that the farmers had no difficulty in getting hard money to buy lands. The quantity sold in 1837 was bought by farmers, and not by speculators. The Treasury order expelled the speculators, with their bales of borrowed bank notes, from the field. It operated as a pre-emption law in favor of cultivators. It is now operating as a pre-emption law in their favor, and, as such, ought to be sustained and supported by all the friends of the settlers. The respectable Legislature of Indiana had passed resolutions against this order; but the resolutions were founded in mistake, as the land sales of the year and of their own State will fully prove. All that are in favor of settlers against speculators should be in favor of that order; for hard money payment is the only thing which can put the farmer above the competition of the bank facility purchasers.
Mr. Benton then exhibited the detailed statement of the sales of the public lands for 1837, to show that, under the operation of the Treasury order, and in the year of ruin, the prosperity of the farming interest, as indicated by their ability to purchase, and to pay for, public lands, was in the ratio of six to one over that of Mr. Adams's time.
The ruin of the currency was the next topic which Mr. Benton took up. "No money," was the cry. Commerce, labor, industry of every kind, stagnant, languishing, paralyzed for want of money to put the wheels of business in motion ! Such is the lamentation which fills this chamber, and is re-echoed every where. But is it true ? Is it true that the country is destitute of money, or only that banks and capitalists have locked it up, and laid it away, to create fictitious scarcity, and thereby aid politicians in promoting discontent and in accomplishing a political revolution ? This is the question, and let authentic facts answer it.
What is the actual amount of currency, paper as well as specie, now in existence in our country ? The most recent, and authentic, estimates will place the amount at about one hundred and seventy millions of dollars; namely, eighty millions of specie, and ninety-five millions of bank notes. The specie was computed at that amount a year ago, and has been increased near five millions during the year 1837 --the year of ruin, and is now daily increasing; the bank notes now in actual circulation are computed at ninety-five millions by the gentleman in the Treasury Department [William Gouge], charged with collecting the returns and expositions of the banks, and who has made out this statement at my special request, to be used upon this occasion. Precise accuracy he knows to be unattainable, but a close approximation to the true amount is easily accomplished where publicity of bank report, are so general as they now are. The quantum of one hundred and seventy millions may then be assumed as the amount of the currency now in existence in the United States. How will this amount compare with periods proclaimed to have been prosperous, and held up for our unceasing admiration and gratitude ?
There are two of those periods, each marking the termination of a National Bank charter, and each presenting us with the actual results of the operations of those institutions upon the general currency, and each replete with lessons of instruction applicable to the present day, and to the present state of things.
The first of these periods is the year 1811, when the first National Bank had ran its career of twenty years, and was permitted by Congress to expire upon its own limitation. I take for my guide the estimate of Mr. Lloyd, then a Senator in Congress from the State of Massachusetts, whose dignity of character and amenity of manners is so pleasingly remembered by those who served with him here, and whose intelligence and accuracy entitle his statements to the highest degree of credit. That eminent Senator estimated the total currency of the country, at the expiration of the charter of the first National Bank, at sixty millions of dollars, to wit: ten millions specie, and fifty millions in bank notes. Now compare the two quantities, and mark the results. Our population has precisely doubled itself since 1811. The increase of our currency should, therefore, upon the same principle of increase, be the double of what it then was; yet it is three times as great as it then was !
The next period uhich challenges our attention is the veto session of 1832, when the second Bank of the United States, according to the opinion of its eulogists, had carried the currency to the ultimate point of perfection. What was the amount then ? According to the estimate of a Senator from Massachusetts, then and now a member of this body, [Mr. Webster,] then a member of the Finance committee, and with every access to the best information, the whole amount of currency was then estimated at about 100 millions; to wit: 20 millions in specie, and 75 to 80 millions in bank notes. The increase of our population since that time is estimated at 26 per cent.; so that the increase of our currency, upon the basis of increased population, should also be 20 per cent. This would give an increase of 20 millions of dollars, making, in the whole, 120 millions. Thus, our currency in actual existence, is nearly one-third more than either the ratio of 1811 or of 1832 would give. Thus, we have actually about 50 millions more, in this season of ruin and destitution, than we should have, if supplied only in the ratio of what we possessed at the two periods of what is celebrated as the best condition of the currency, and most prosperous condition of the country.
So much for quantity; now, for the solidity of the currency at these respective periods. How stands the question of solidity ? Sir, it stands thus: in 1811, five paper dollars to one of silver; in 1832, four to one; in 1838, one to one, as near as can be ! Thus, the comparative solidity of the currency is infinitely preferable to what it ever was before; for the increase, under the sagacious policy of General Jackson, has taken place precisely where it was needed-- at the bottom, and not at the top; at the foundation and not in the roof; at the base and not at the apex. Our paper currency has increased but little; we may say nothing, upon the bases of 1811 and 1832; our specie has increased immeasurably; no less than eight fold, since 1811, and four fold since 1832. The whole increase is specie; and of that we have 70 millions more than in 1811, and 60 millions more than in 1832. Such are the fruits of General Jackson's policy! a policy which we only have to persevere in for a few years, to have our country as amply supplied with gold and silver as France and Holland are; that France and Holland in which gold is borrowed at 3 percent, per annum, while we often borrow paper money at 3 per cent. a month.
But there is no specie. Not a nine-pence to be got for a servant; not a picayune for a beggar; not a ten cent piece for the post office. Such is the assertion; but how far is it true ? Go to the banks, and present their notes at their counter, and it is all too true. No gold, no silver, no copper to be had there in redemption of their solemn promises to pay. Metaphorically, if not literally speaking, a demand for specie at the counter of a bank might bring to the unfortunate applicant more kicks than coppers. But change the direction of the demand; go to the brokers; present the bank note there; no sooner said than done; gold and silver springs forth in any quantity; the notes are cashed; you are thanked for your custom, invited to return again; and thus, the counter of the broker, and not the counter of the bank, becomes the place for the redemption of the notes of the bank. The only part of the transaction that remains to be told, is the per centum which is shaved off ! And, whoever will submit to that shaving, can have all the bank notes cashed which he can carry to them. Yes, Mr. President, the brokers, and not the bankers, now redeem the bank notes. There is no dearth of specie for that purpose. They have enough to cash all the notes of the banks, and all the Treasury notes of the Government into the bargain. Look at their placards! not a village, not a city, not a town in the Union, in which the sign-boards do not salute the eye of the passenger, inviting him to come in and exchange his bank notes, and Treasury notes, for gold and silver. And why cannot the banks redeem, as well as the brokers ? Why can they not redeem their own notes ? Because a veto has issued from the city of Philadelphia, and because a political revolution is to be effected by injuring the country, and then charging the injury upon the folly and wickedness of the Republican Administrations. This is the reason, and the sole reason. The Bank of the United States, its affiliated institutions, and its political confederates, are the sole obstacles to the resumption of specie payments. They alone prevent the resumption. It is they who are now in terror lest the resumption shall begin, and to prevent it, we hear the real shout, and feel the real application of the rallying cry, so pathetically uttered on this floor by the Senator from Massachusetts, [Mr. Webster]--once more, unto the breach, dear friends, once more!
Yes, Mr. President, the cause of the non-resumption of specie payments is now plain and undeniable. It is as plain as the sun at high noon, in a clear sky. No two opinions can differ about it, how much tongues may differ. The cause of not resuming is known, and the cause of suspension will soon be known likewise.
Gentlemen of the Opposition charge the suspension upon the folly, the wickedness, the insanity, the misrule, and misgovernment of the outlandish Administration, as they classically call it; expressions which apply to the people who created the Administration which have been so much villified, and who have sanctioned their policy by repeated elections. The Opposition charge the suspension to them --to their policy--to their acts--to the veto of 1832--the removal of the dcposites of 1833--the Treasury order of 1836-- and the demand for specie for the Federal Treasury. This is the charge of the politicians, and of all who follow the lead, and obey the impulsion of the de-nationalized Bank of the United States. But what say others whose voice should be potential, and even omnipotent, on this question ?
What say the New York city banks, where the suspension began, and whose example was alleged for the sole cause of suspension by all the rest ? What say these banks, whose position is at the fountain-head of knowledge, and whose answer for themselves is an answer for all. What say they ? Listen, and you shall hear! for I hold in my hand a report of a committee of these banks, made under an official injunction, by their highest officers, and deliberately approved by all the city institutions. It is signed by Messrs. Albert Gallatin, George Newbold, C.C. Lawrence, C. Heyer, J.J. Palmer, Preserved Fish, and G.A. Worth; seven gentlemen of known and established character, and not more than one out of the seven politically friendly to the late and present Administrations of the Federal Government. This is their report:
"The immediate causes which thus compelled the banks of the city of New York to suspend specie payments, on the 10th of May last, are well known. The simultaneous withdrawing of the large public deposites, and of excessive foreign credits, combined with the great and unexpected fall in the price of the principal article of our exports, with an import of corn and bread stuffs, such as had never before occurred, and with the consequent inability of the country, particularly of the South-western States, to make the usual and expected remittances, did, at one and the same time, fall principally and necessarily, on the greatest commercial emporium of the Union. After a long and most ardous struggle, during which the banks, though not altogether unsuccessfully, resisting the imperative foreign demand for the precious metals, were gradually deprived of a great portion of their specie; some unfortunate incidents of a local nature, operating in concert with other previous exciting causes, produced distrust and panic, and finally one of those general runs, which, if continued, no banks that issue paper money payable on demand, can over resist; and which soon put it out of the power of those of this city to sustain specie payments. The example was followed by the banks throughout the whole country, with as much rapidity as the news of the suspension in New York reached them, without waiting for an actual run, and principally, if not exclusively, on the alleged grounds of the effects to be apprehended from that suspension. Thus, whilst the New York city banks were almost drained of their specie, those in other places preserved the amount which they held before the final catastrophe."
---[Carefully not mentioned is the root cause of bank runs and burstings of credit bubbles: fractional reserve banking, the institutionalized fraud of issuing 10 to 50 times more promises to pay coin than coins in poession (or even in existence).]
Resuming his remarks, Mr. Benton repeated, this is what they say ! These are the reasons assigned by those bankers for the stoppage! and what are they ? They are,
1. The simultaneous withdrawing of the deposites;
2. Excessive importations of foreign goods on credit;
3. Fall in the price of cotton;
4. Importation of wheat and flour;
5. Some unfortunate incidents of a local nature; of which the death; by supposed suicide, of one of the bank presidents, may be considered as the principal.
These are the reasons! and what becomes now of the Philadelphia cry, re-echoed by politicians, and subaltern banks, against the ruinous measures of the Administration ? Not a measure of the Administration mentioned! not one alluded to ! Not a word about the Treasury order; not a word about the veto of the National Bank charter; not a word about the removal of the deposites from the Bank of the United States; not a word about the specie policy of the Administration ! Not one word about any act of the Government, except that distribution act, disguised as a deposite law, which was a measure of Congress, and not of the Administration, and the work of the opponents and not the friends of the Administration, and which encountered its only opposition in the ranks of those friends. I opposed it, with some half dozen others; and among my grounds of opposition one was, that it would endanger the deposite banks, especially the New York city deposite banks, that it would reduce them to the alternative of choosing between breaking their customers, and being broken themselves. This was the origin of that act --the work of the Opposition on this floor; and now we find that very act to be the cause which is put at the head of all the causes which led to the suspension of specie payments. Thus, the Administration is absolved. Truth has performed its office. A false accusation is rebuked and silenced. Censure falls where it is due; find the authors of the mischief stand exposed in the double operation of having done the mischief, and then charged it upon the heads of the innocent.
But, gentlemen of the Opposition say, there can be no resumption until Congress "acts upon the currency." Until Congress acts upon the currency! that is the phrase! and it comes from Philadelphia; and the translation of it is, that there shall be no resumption until Congress submits to Mr. Biddle's bank, and re-charters that institution. This is the language from Philadelphia, and the meaning of the language; but, happily, a different voice issues from the city of New York ! The authentic notification is issued from the banks of that city, pledging themselves to resume by the 10th day of May. They declare their ability to resume, and to continue specie payments, and declare they have nothing to fear, except from "deliberate hostility" --an hostility for which they allege there can be no motive-- but of which they delicately intimate there is danger. Philadelphia is distinctly unveiled as the seat of this danger. The resuming banks fear hostility --DELIBERATE ACTS OF HOSTILITY-- from that quarter. They fear nothing from the hostility, or folly, or wickedness of this Administration. They fear nothing from the Sub-Treasury bill. They fear Mr. Biddle's bank, and nothing else but his bank, with its confederates and subalterns. They mean to resume, and Mr. Biddle means that they shall not. Henceforth two flags will be seen, hoisted from two great cities. The New York flag will have the word RESUMPTION inscribed upon it; the Philadelphia flag will bear the inscription of NON-RESUMPTION, and DESTRUCTION TO ALL RESUMING BANKS. Under the one, or the other, of these two flags, all other banks, all citizens, and each political party, will be found arranged. The whole country will divide between them, and no neutrals will be seen. In that great division, I assume to assign no one to a place. I leave it to each to find, and to take his own position.---[Could this be an indication of a struggle between the circle of friend of Baring & Brothers, congregating in and around Philadelphia, and the Frankfurt money power, centered in New York city ?]
Of political parties, so far as chiefs are concerned, we can all see that their places are already taken. The Federal gentlemen are under the flag of NON-RESUMPTION; the Republicans are under the flag of RESUMPTION. My best wishes attend this latter flag; and, if need be, I shall be ready to give it a lift, and even to strain a point to help it on to victory.
I have carefully observed the conduct of the leading banks in the United States. The New York banks, and the principal deposite banks, had a cause for stopping which no others can plead, or did plead. I announced that cause, not once, but many times, on this floor; not only during the passage of the distribution law, but during the discussion of those famous land bills, which passed this chamber, and one of which ordered a peremptory distribution of sixty-four millions, by not only taking what was in the Treasury, but by reaching back, and taking all the proceeds of the land sales for years preceding. I then declared in my place, and that repeatedly, that the banks, having lent this money under our instigation, if called upon to reimburse it in this manner, must be reduced to the alternative of breaking their customers, or of being broken themselves. When the New York banks stopped, I made great allowances for them; but I could not justify others for the rapidity with which they followed their example, and still less can I justify them for their tardiness in following the example of the same banks in resuming. Now that the New York banks have come forward to redeem their obligations, and have shown that sensibility to their own honor, and that regard for the punctual performance of their promises, which once formed the pride and glory of the merchant's and the banker's character, I feel the deepest anxiety for their success in the great contest which is to ensue. Their enemy is a cunning and a powerful one, and as wicked and unscrupulous as it is cunning and strong.
Twelve years ago, the president [Nicholas Biddle] of that bank which now forbids other banks to resume, declared in an official communication to the Finance Committee of this body, "that there were but few State banks which the Bank of the United States could not DESTROY by an exertion of its POWER." Since that time it has become more powerful; and, besides its political strength, and its allied institutions, and its exhaustless mine of resurrection notes, it is computed by its friends to wield a power of one hundred and fifty millions of dollars! all at the beck and nod of one single man! for his automaton directors are not even thought of. The wielding of this immense power, and its fatal direction to the destruction of the resuming banks, presents the prospect of a fearful conflict ahead. Many of the local banks will doubtless perish in it; many individuals will be ruined; much mischief will be done to the commerce and to the business of different places; and all the destruction that is accomplished will be charged upon some act of the Administration --no matter what-- for whatever is given out from the Philadelphia head is incontinently repeated by all the obsequious followers, until the signal is given to open upon some new cry.
The ruin of the exchanges, both foreign and domestic, was the next topic of lamentation which Mr. Benton examined. He said that the short interval which had elapsed since the extra session had put an end to one branch of this lamentation --the branch of the foreign exchanges. At that session nothing but the recharter of the National Bank could turn the foreign exchanges in our favor; which, in May, were 22 against us. Gentlemen were just as positive of that, at the extra session, as they now are of the present total perdition of the country; yet in three brief months, and left to the operations of commerce, foreign exchange has regulated itself! and is now at 4 or 5 per cent. nominal, giving a real difference in our favor of 5 or 6 percent. If the Congress had yielded to the clamor got up for the recharter of the National Bank at the extra session, with what exultation would not this chamber, and the whole Union, have rang ! We should never have heard the last of it. As it is, the word foreign exchange is not even mentioned. That branch of the lamentation has ceased. It is the domestic exchanges which now engross all concern. The revival of the great regulator is indispensable to their restoration. To hear these gentlemen, it would be supposed that domestic exchanges were never deranged before; that during the existence of the National Bank, all moneyed exchanges were level, and equal, and equable throughout the Union. Alas! that human memory is so short and treacherous.
I have in my hand, sir, a comparative statement of domestic exchanges, in the bank note department, for the glorious year of 1826, when the Federal Administration was in the middle of its reign --when the Federal Bank was in its meridian splendor-- when the Senator from Kentucky, who now mourns the ruin of all things [Mr. Clay] was in the Department of State --and when all the present orators of woe, or weoful orators, as the case may be, rejoiced in the plenitude of power which their party then possessed, and celebrated the felicity of man on earth. This comparative table is made up from the prices current of Philadelphia --from the very seat and citadel of the great regulator itself-- and what does it say ? Listen to it, and it will tell you.
Maine, New Hampshire, Vermont, Massachusetts, Rhode Island, and Connecticut, from 2 to 2½ per cent. discount in December, 1826; from 1½ to 2 in February, 1838.
New York city, par then, and par now.
Country banks of New York, 1½ to 2 per cent. discount then; par now.
Baltimore, ½ then; ¾ now.
Western Virginia, 4 to 5 discount then; 2½ to 3 now.
North Carolina, 2½ to 5 then; 2½ to 3 now.
South Carolina, 1½ to 2 then; 2½ to 3 now.
Georgia, 2½ to 3 then; 3½ to 4 now.
Alabama, 10 to 15 then; 9 to 9½ now.
Louisiana, 5 to 6 then; 4 now.
Mississippi, 10 to 16 then; 15 now.
Tennessee, 10 to 20 then; 12 to 12½ now.
Ohio, from 4 to 6 then; 3½ to 4 now.
KENTUCKY --(and at the name of Kentucky, Mr. Benton raised his voice, and repeated the name with great emphasis)-- Kentucky, from 45 to 55, and from 55 to 35 per cent. discount then; from 3½ to 4 discount now !
Let no gentleman suppose there is any mistake of figures in this reference to Kentucky. There is more than one person present who was then in Kentucky, and knows that 50 per cent. was the common difference of exchange against her currency. I myself travelled in Kentucky in that period, and know the fact, and often saw the bills of travellers and others made out double --so much in specie, and so much in Kentucky paper-- and the latter precisely the double of the former. Such is the result of the comparison between the year 1826 and the year 1838; in almost every instance decidedly in favor of the present day, and in the case or Kentucky ten to one more favorable to her now than then. Yet this Senate is to be lectured, and the people of the United States to be terrified, with a tale of the ruin of these exchanges, brought about by the misrule of a senseless, wicked, impracticable, and outlandish Administration. Such is the result; the same in exchanges as in commerce and in every thing else; the country incomparably better off than it ever was before. And yet grave Senators, or Senators who ought to be grave, are seen to rise in their places, compose their faces for the expression of woe, attune their voices for the communication of lamentable sounds, and then enact the part of Volney, sitting upon the ruins of Paimyra, and bewailing the downfall of states and empires.
I will grant you, continued Mr. Benton, that domestic exchanges are deranged at present, --much deranged, but not so much so as in 1826; and why are they deranged now ? Because specie payments are suspended; let specie payments be resumed, and domestic exchanges instantly regulate themselves, and effect the regulation upon the simple and eternal principle of the expense of freight and insurance in the transportation of metallic money. The freight and insurance of silver, between any two extreme points in the United States, is 2 per cent.; and that is the fair exchange on silver between the extremities of the Union. The exchange on gold is less than half what it is on silver, the freight being so much less; and, in addition to all other arguments in favor of a gold currency, that of being the best regulator of exchange, is one of those which presents itself to the mind of every political economist.
Mr. Benton would make a few observations upon this subject of domestic exchanges. It was a subject on which every body had got to talking within a few years past, and which was now thrust into every argument upon the question of currency and finance. All this has grown up since the Bank of the United States had undertaken to regulate the exchanges. More had been said and written on this subject since Mr. Biddle became president of the National Bank than in two hundred years before; more in fact than had been said upon it since the day that John Cabot first came in sight of the North American coast. And why ? Because in the administration of that bank, immediately after Mr. Cheves left it, commenced the abuse and perversion of the business of exchange, which was soon imitated by local banks, until it has now become a means of extorting usury, transcending all other means of extortion, and brought to bear upon people who wish to borrow money, and not to sell bills, and many of whom never heard of a bill of exchange until they learnt that it was the only way in which money could be got out of a bank.
The Legislature of Indiana has just made examinations upon this subject which show the nature of the abuse; but the practice of it was inconsiderable in that State compared to what it was in other places. The returns of the deposite banks, and of the Bank of the United States, show the extent of the practice: and referring to the last of these returns made before the suspension of specie payments, and the mass of dealings in these bills, and their excessive disproportion to ordinary loans, becomes impressively striking. I could name a bank, an interior one, not in a great city, nor even on a great river, in which the purchase of bills was $690,000, while the loans in the old way, on notes, were but $4,728 and 14 cents !
[Mr. Buchanan and other Senators here asked for the name of the bank.]
Mr Benton said his object was to expose a general practice, and not to exhibit particular instances; but as the name of this bank was called for, he would give it with the leave of the young Senator from Ohio [Mr. Allen]; it was the bank in the town of his residence, Chillicothe. But why mention particular instances where the practice is general ? The returns of the Rank of the United States show that twenty odd millions were often out in domestic bills of exchange; the last returns of the deposite banks, before they suspended, showed that they had forty-four millions out in that way; nine of them only had twenty-two millions in these bill; and in looking over the column of suspended debts, it is seen that default in payment chiefly occurred on this description of debts. Much of this is an abuse of exchange. Much of it is a mere mode of covering usurious loans. A citizen is forced to give a bill when he only wants to borrow; if he got the money as a loan on his note, he would pay nothing but interest, but getting it on a bill he has to pay exchange in addition to interest, and then commissions besides. Where the citizen is obliged to have the money, the bank can put the exchange at what it pleases, and so practice extortion and usury to any extent that it is willing. This business, as an abuse, began with the Bank of the United States under the administration of Mr. Biddle. It was one of my original objections to that bank. Its branches were engines for practising this abuse; and its own friends were among the first that ever complained to me about it. In the reform of the banking system, to the necessity of which the public mind is now waking up, this abuse of the business of domestic exchanges is entitled to the first notice. It is a vast system of usury, extortion, and oppression of the community, a total perversion of the business of a bank, and a source of enormous and illicit gains, enabling them, after dividing vast profits, to give to their presidents and cashiers, in many instances, salaries transcending those of our Heads of Departments, Vice-President, and Chief Justice of the Supreme Court of the United States.
Mr. Benton then adverted to the ruin of prices, which had figured so largely in gentlemen's speeches on the calamities of the country. Property, produce, labor --every thing, according, to them, was now without price. But how was it in the fine times of Mr. Adams's administration ? Compare the prices of the two periods. Pork, then $1.25 per hundred, in the western country; wheat, some 30 odd cents per hushel; flour, $3 a barrel; cotton, 8 or 9 cents a pound; and every thing else in the same proportion. The people remember all this, and read with astonishment the distress harangues which go forth from this floor. They know very well that all prices are better now, even when reduced to the specie standard, than they were in the time of the national bank, and under the Federal Administration. They have memory, and can recollect ten or twelve years back.
Memory is the lowest attribute of the mind. It belongs even to irrational animals --to cattle. And yet the Federal gentlemen do not seem to know that the people have memory, much less reason and judgment; and here is the fault, or the misfortune, of the gentlemen of the Federal party. They believe they monopolize all the intelligence of the country; and, by consequence, that the people know nothing, and will have to believe all they hear; and, thereupon, they tell them most incredible things. Now this belief of a monopoly of all the intelligence extant, would be a very sweet conceit to indulge in privately, or even to point a Bacchanalian song, or grace a barbecue speech, or to swell the exaltation of midnight orgies; but it is fatal to act upon it in the business of life. The fate of the panic-makers of 1833, should warn them of that! when every panic-making candidate for the Presidency, instead of killing Jackson and Van Buren, killed himself off of the list of candidates ! And when the tug of war came, they were found to be what the broken bank notes are in the Treasury, --an unavailable fund! So may it be again. The people have memory, and knowledge, and reason, and judgment; and it will not do for politicians to treat them as wanton boys do young robins, when they throw them gravel in place of bread. The people know their own condition, and they see through the conduct of others. The farmers who were selling their produce in 1826 for the one-third, the one-half, or the three-fourths of what they are getting for it now, will not believe in the ruin of prices with which politicians assail their ears.
Mr. Benton finished the comparison, or rather the contrasts, between the year of Republican ruin, and the period of Federal prosperity, with the expression of his confident belief that the fallacy of all the gentlemen's lamentations had been completely shown. There was no ruin, but in their own imaginations. The year 1837, though not equal in the general activity of business to the bloated overaction of 1836, was yet transcendently superior to any year of Mr. Adams's administration. Making a due allowance for an increase of population, and the superiority was still far beyond that increase.
Having vindicated General Jackson's Administration from the imputation of having brought ruin upon the country, Mr. Benton proceeded to notice some of the wars General Jackson was charged with waging upon some public institutions, and some branches of industry. He was charged by two Senators on this floor [Messrs. Tallmadge and Clay] with having made war upon the late Bank of the United States; and one of these Senators [Mr. Clay] had charged this war to the base motive of revenge, because he could not succeed in his attempts to seduce this virtuous institution into the field of politics, and into the support of his own political views.
The first remark which I have to make upon this imputed war, is upon the new idea which it presents of the right of the bank to be continued in its existence, when to oppose that continuation of existence is deemed a violation of that right, and a commencement of hostilities upon the institution.
General Jackson made no movement against the existing charter of the late bank; he made no attempt to impair, or to destroy, the existing charter. The extent of his action was to recommend to Congress the non-renewal of the charter, and, afterwards, to disapprove the new charter which Congress had granted. This was the extent of his action --directed against a non-existent, and not against an existing charter. According to the Republican reading of the Constitution, the President had a right to do these things: nay more, that it was his duty to make this recommendation, and to express this disapproval, if he thought the Constitution, or the public good, forbid the future existence of the bank. He had a clear right, under the Constitution, to do what he did; but according to the Federal reading of the Constitution, as exhibited by this objection, he had no such right; but was guilty of lawless violence, and waged war upon the institution, both in the recommendation, and in the exercise of the veto. This is the fair inference resulting from the accusation ! Such is the progress of anti-republican ideas among us! ideas which go to invest a moneyed corporation with a rightful claim to a perpetuity of existence, and to stigmatize as war the constitutional exercise of Executive rights and duties.
With these remarks, to show the progress among us of ideas towards the royal doctrine of legitimacy, I come to the main inquiry-- the truth of the charge itself. Is it true that General Jackson made war upon the Bank of the United States? is it true that he was in favor of that institution, and only turned against it after his election to the Presidency, and after he had failed in an attempt to convert it into a political machine, to subserve his own political purposes ? These are the questions which are now to be answered, and, happily, they will receive answers which will consign the charges to the lowest place in the deepest abyss of political calumnies.
These charges first crept into daylight at the veto session of 1832, and attained their full form and shape at the famous panic session of 1833-'34. In both instances they emanated directly from the Bank of the United States itself; and in the matured form which they received in 1833, in a report of a committee of that Bank, approved by the majority of its directory, they imported that, immediately after the elevation of Gen. Jackson to the Presidency, a meeting was held, of the principal chiefs, to consider of the means of perpetuating their new authority; and the possession of the Bank was among the objects of the parties assembled. There was a combined effort to render the Bank subservient to political purposes, and to break it if it could not be bent to these purposes.
This was the charge,-- one very specific, and very susceptible of proof, if there was any truth in it. No proof, however, has ever been attempted by those who made it, and no other specification under it, but the forty times exploded misrepresentation about Jeremiah Mason, the president of the Portsmouth branch bank. The cabinet meeting, and the application for the removal of Mr. Mason, are fixed for the spring of 1829; and as the whole attempted seduction, or destruction, of the Bank, was then planned, and as far as seduction was concerned, was then fully tried, a date thereby presents itself which becomes the touchstone of the accusation. It is in the spring of the year 1829 that General Jackson has a meeting, and a consultation, and resolves to bend the Bank to his purposes, or to break it; and it is in June of the same year that the vile seduction is attempted, and is so indignantly repulsed ! Of course, from that time forward, General Jackson could feel nothing but resentment against the unseducible Mr. Biddle, and Mr. Biddle could feel nothing but abhorrence for the man that had attempted his honor.
Now mark what havoc a few stubborn dates, and a few recorded facts, will make of all this fine romance ! The spring of 1829 is the date of this ferocious resolution of seduction, or destruction, and of repulse at seduction. Now what does January of 1830 bring forth ? A nomination to the Senate of the United States, by General Jackson, of this same Mr. Biddle to be one of the Government directors of the bank; and nominated at the head of the list, which was tantamount to nominating him for the presidency of the bank. In the Senate this nomination is unanimously voted for by the friends of General Jackson, and Mr. Biddle accepts the appointment thus conferred. This is one date and one fact. What next ? Why, in January, 1831, President Jackson repeats the same nomination; his friends in the Senate give it the same unanimous vote, and Mr. Biddle repeats his acceptance of this repeated appointment. This is a second date, and a second fact. Is there any thing more ? Yes, sir, another nomination --another unanimous vote for it-- and another acceptance, in January, 1832. So that three times, in three years, after resolving on the destruction of Mr. Biddle and the bank --after resolving to bend the bank to his purposes, or to, break it --this violent man, who will brook no opposition to his will, replaced the same Mr. Biddle as a Government director, and indicated him for the head of the institution; and three times, in three years, after this attempted seduction, did Mr. Biddle receive appointments at the hands of the man whom, he now gives us to understand, he held in abhorrence on account of that attempt.
Mr. President, there are cases in which the wise maxims of the law --the Mosaic, as well as the civil, and the common law-- require an immediate cry, and will not listen to a stale accusation. The instance before us is one of those cases. The virgin bank should have screamed in June, 1829 ! It was too late to begin, faintly, in May, 1832, after it was known that the veto was resolved upon, and only rise to an audible shriek in December, 1833, after the deposites had been removed. Such long delayed complaint of outrage, and then a limping and halting complaint, under such circumstances, looks more like the accusation of revenge than the shriek of injured innocence. It looks like the accusation of Potiphar's wife against Joseph. No, sir! the accusation is false upon its face. It is proven to be false by dates and facts; but the proof does not stop here. I have another piece of evidence in my possession, of character still higher, and of effect still more conclusive, to be produced if the Senate pleases: it is a letter from General Jackson himself; and being a letter, it cannot be read except by the leave of the Senate. [Cries of leave, leave, leave, from different parts of the chamber.] Mr. Benton would avail himself of the leave which was granted, and would read the letter; but he first chose to explain the circumstances under which it came to be written. We have many prophets in this time, said Mr. Benton, but most of them are ex post facto performers in the art of divination --foretelling most accurately the whole event after it had happened. I, on the contrary, have undertaken to practice a little in the old way --to divine ahead-- to prophetize of a coming event; and so, when on my way to Congress last fall, I wrote to General Jackson from my steamboat in the Ohio river, to inform him of this attack which was to be made upon him in the Senate, and to say to him that if he chose to answer it himself, and would write me a letter to that effect, I would dramatize the scene, when the attack was made, by introducing him to speak for himself. The attack has been made; and here is the answer, a letter from the Hermitage, dated November 29, 1837, all written in the old General's own hand, and written with the vigor and rapidity of an arm that was driving the British and the Indians before it. This is the letter:
"Hermitage, November 29, 1837.
"The charge made of my being friendly to the Bank of the United States until I found it could not be used to subserve my political purposes, when I turned against it, is one of the basest calumnies ever uttered. Such must all pronounce it who know any thing about me. I have ever opposed the establishment of this bank on grounds of both constitutionality and expediency.
"When the aristocratic few at Nashville first made a movement to obtain a branch there, they were forestalled by a law of the Legislature, imposing a heavy fine upon any bank that should attempt to do business within the limits of the State without being first chartered by the Legislature thereof. This provision of the Legislature had my cordial approbation, and prevented, while it continued in force, a location of the branch of the bank at Nashville; but it was afterwards repealed. I was absent at the time the subject of repeal was discussed, but reached the seat of Government the night before the final vote on its passage in the State Senate, and in time to expostulate with Robert C. Foster, esq. then the residing officer over that body. I warned him of the danger of repealing that law, and stated to him that the object of those who favored the repeal was the introduction of the United States Bank, and that the results of the operation of this institution in Tennessee would be to drain the State of its precious metals, for the benefit of the foreigners who held its stock. The circumstance that there was, at this time but one or two individuals in this State who owned any stock of the institution, enabled me to press the argument on this score with considerable force. But Mr. Foster, if now appealed to, must vouch for the fact that my objections to the bank were founded principally on my conviction that its charter was not authorized by the Constitution of the United States. My admonitions were, however, unheeded; the penalty was repealed; and, as I foresaw and predicted, steps were soon taken to obtain the location of a branch at Nashville. A memorial to this effect was presented to me for my signature, which I peremptorily refused to sign. General Cadwallader shortly afterwards came to Nashville as agent of the bank, and visited and dined with me. My opposition to the bank, and repugnance to its establishment at Nashville, were, on this occasion, as free and unreserved as they had been before.
"Some short period after the visit of General Cadwallader, when the branch was established, a recommendation for the appointment of two gentlemen to fill the places of its president and cashier was shown to me, with a request that I should state my knowledge of the character of these two gentlemen. The bank being established, and the people liable to be cursed with all its attendant evils, I expressed my confidence in the two gentlemen referred to, believing them to be honest, and that, as far as they had control over the institution, it would not be wielded for corrupt political purposes. This recommendation, I have been informed, has been used to prove my approbation of the establishment of this bank. So, also, has my agency in forwarding a memorial from the mercantile interest of Pensacola, in the year 1821, when I was the Governor of Florida. On this last occasion, my hostility to the bank was freely expressed, but this did not restrain me from forwarding a memorial of the citizens for the establishment of a branch. As Governor of the Territory, I deemed it my duty to make known the wishes and feelings of the people, however different they were from my own.
"Having early imbibed the jealousy of those who framed the Constitution, in respect to the dangers of monopolies to the freedom of the citizen, and to the sovereignty and efficacy of our State Governments, I have been always unfriendly to the Bank of the United States. Nor have I stopped here. My views have been equally repugnant to the establishment of State banks of mere paper issues, as all must recollect who have any knowledge of my conduct as a citizen of Tennessee, and particularly of the part I took when its late State bank was incorporated. My position now is, and has ever been since I have been able to form an opinion on this subject, that Congress has no power to charter a bank, and that the States are prohibited by the Constitution from issuing bills of credit, or granting charter by which such bills can be issued by any corporation or other body."
Having read the letter, Mr. Benton said he should make but three remarks upon it; first, that it contained a peremptory contradiction of this whole story of turning against the bank, because he could not bend it to his purposes; secondly, that it shows General Jackson to have been always opposed to any Bank of the United States, and against the recharter of the late one; thirdly, that it carries home a knowledge of all this to the bank itself in the person of its confidential agent, its frequent director, and the friend and connection of Mr. Biddle.
General Jackson is cleared of the foul imputation, and how stands the matter of fact with that bank ? Is it, or is it not, a political machine, and as such constantly working with a political party, and with that party whose tenets favor the fundamental principles of that corporation ? I hold the affirmative of these inquiries, and shall insist that the bank was created for a political machine; that it always has been, and forever will be, such a machine; and that it belongs to the party whose latitudinarian doctrines, and whose passion for a strong and splendid Government, find a natural support in an institution whose principle are-- concentration of wealth, exclusive privileges, monopoly, perpetuity of existence, irresponsibility to the people, and succession of membership.
National banks owe their establishment, in these United States, to General Hamilton --a frank and a brave man, who scorned to deny or to dissemble his objects. He made his first report to Congress, in favor of a national bank, in December, 1791; and in that original proposition for creating the institution, he boldly avows its political character. These are his words: "Such a bank is not a mere matter of private property, but a POLITICAL MACHINE of the highest importance to the State." Created then for a political machine, it immediately entered upon the fulfilment of its destination; and this first bank, thus created, is said by Marshall, in his Life of Washington, "To have contributed to that complete organization of those distinct and visible parties, which, in their long and dubious conflict for power, have since shaken the United States to their centre."
A political machine, defining parties, and acting with the Federalists during the whole period of its existence, the first Bank of the United States sunk under the odium of its party character. The Republicans, in the ascendant, refused to renew its charter in 1811. The question of renewal, as the debates of the time fully show, largely turned upon the political character and conduct of the institution; and a member of the Senate, then and now on this floor, [Mr. Clay] characterized the Federal Senators present as the Macedonian phalanx of the bank.
The creation of the second bank, in 1816, was also contested as a political institution, but with an almost total reversal of parties. Mr. Madison's administration, in putting down the first bank, had committed the great error of falling back upon the local banks for a national paper currency. Instead of re-establishing the currency of the Constitution for the Federal Treasury, and especially restoring the gold currency, by correcting the erroneous standard of that metal, and thereby preserving an adequate supply of the precious metals for the use of the whole country, the great error was committed of falling back upon the paper currencies of the States. The fruit of that error was, the speedy reduction of the Federal Government to the use of broken bank paper, the involvement of the whole community in the same calamity, and a resort to a second National Bank to supply a national paper currency. The second bank was brought forward, in the extremity of their distress, by the Republican Administration, to help them out of the mud and mire of a broken bank currency, and to aid them in the operations of the Government. It was then to be a machine on their side. As such, it was supported by Republicans; as such it was opposed by Federalists; a reversal of party position having taken place in relation to the bank, and each party having fallen into the delusive belief that a National Bank could be the supporter of a Republican Administration ! Parties changed position, a few individuals standing firm on each side; but the masses crossing over, taking each others places, and freely dealing out the accusations of, inconsistency--desertion--abandonment of friends--compromise of principle, &c. &c. It would be tedious to verify this statement by a citation of speeches, and the reading of yeas and nays; nor is it necessary to cite much. A single quotation from the speeches of the two eminent members, one of the Senate and one of the House, and both present members of this body --then on opposite sides in relation to the bank, now both on the same side in favor of it-- will illustrate the point in issue, and establish everything necessary to be known about it. By one of these speeches the creation of the bank was advocated as a political power, necessary to be possessed by the Federal Government, as a counterpoise to the political power which the local banks gave to the States; and the loyalty of the State in which the mother bank was placed, was relied upon to prevent a concurrence in any scheme for subverting the Federal Government. By the other speaker, the creation of this bank, with a participation in its management and direction by the appointment of five directors --its capital of thirty-five millions-- and the control and influence which the Government would have over it, presented it as an object of vice and deformity; and as giving to the Government a power over the institution, and over individuals, which would enable it to bring any man into terms, and to compel the bank itself to do whatever the Administration pleased.
Mr. Benton then read a passage from a speech of Mr. Clay delivered in Kentucky, after his return from Congress in 1816, and explaining the reasons for his change of opinion in relation to a National Bank. The passage was in these words:
If political power be incidental to banking corporations, there ought, perhaps, 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 power to incorporate banks equally, or in proportion 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 contingency is to be found in the distribution of branches in different States, acting and reacting upon the parent institution, and upon each other.
Mr. Benton then read a paragraph from a speech of Mr. Webster, delivered in the House of Representatives, April 4, 1816, in opposition to the charter of the second Bank of the United States:
"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 desertion, not only of principles, but of friends, which had characterized the proceedings on the 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 amendments, 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.---[Senator Benton left out the third outstanding orator in the contest, John Calhoun, who also took an 180 degree turn, but in the other direction --away from protection and central bank, over to free-trade and no central bank; in 1816 Mr. Calhoun was in the House of Representatives and actively supported the charter, in the 1830s he eloquently opposed the concept of a central bank.]
"Mr. Webster said he considered it a matter of principle; but attributed that opinion to the gentleman from New York no further than he had assumed 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 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 ?"
Such are the grounds on which the establishment of the second Bank of the United States was, contested in 1816. The Republicans advocated it, because they saw no other way to get out of the slough of irredeemable paper money; the Federalists opposed it, because they feared the bank would be an engine of power and influence in the hands of the Republican Administration. A few years' experience dispelled this fear.
At the first reorganization of parties, the bank developed as a political power on the Federal side. This was at the Presidential election, in the House of Representatives, in February, 1825. The bank then took the field, on the side opposed to the candidate who had the plurality of the people's votes in his favor. It has kept the field ever since; and if it is now unable to resume specie payments, it must be principally on account of expenses and losses incurred in thirteen years' warfare against the people of the United States, --against their form of Government, and against the persons whom they have elected to carry on the Government. The bank is now the head, and the support of the Federal party; all the Federalists who opposed its creation, have gone over to it. It is their leader, and their pointe d'appui. Any catastrophe to it would be destruction to them, and would annihilate them as a national party. Away then with vain denials, of which nobody is the dupe. The bank is a political machine --a Federal political machine, and no denial of the fact can alter or conceal its truth. The leopard had as well deny the spots on his body --the Ethiopian had as well deny the color of his skin, as for this bank to deny its political character, its anti-Republican nature, and its thirteen years' warfare upon the people and their form of Government.
War upon the local banks is the next accusation upon General Jackson and his successor. After putting down the Bank of the United States, he went to work to destroy the State banks. So say the Opposition speakers, [Messrs. Tallmadge and Clay.] Now let us examine into the truth of this accusation. What was the conduct of General Jackson to the local banks ? In 1833 he removed the public deposites to these banks, and gave them the benefit of the immense accumulations of public money which then took place. At the same time, he released their notes from that state of exclusion from the Federal Treasury to which they had been subjected during the whole time of the Bank of the United States. For the first time, in near twenty years, their notes were received and paid out in the receipts and disbursements of the Federal revenue. At the panic session, when the whole Opposition exerted themselves for so many months to excite a run upon the local banks, and to blow them up, who defended them, here and elsewhere, but General Jackson and his friends ? Who defended the Safety Fund banks from the dead set which was then made at them ? General Jackson and his friends ! Who rejoiced in the explosions of the District banks, and the Maryland Bank, and announced the joyful tidings on this floor ? The Opposition ! And who grieved over these failures ? General Jackson and his friends ! And when the time came for him to deliver his last annual message, what was his language in relation to these banks ? Was it that of vengence, or was it the language of kindness, of confidence, and of support ? Listen to it:
"Experience continues to realize the expectations entertained as to the capacity of the State banks to perform the duties of fiscal agents for the Government at the time of the removal of the deposits. It was alleged by the advocates of the Bank of the United States that the State banks, what ever might be the regulations of the Treasury Department, could not make the transfers required by the Government or negotiate the domestic exchanges of the country. It is now well ascertained that the real domestic exchanges performed through discounts by the United States Bank and its 25 branches were at least 1/3 less than those of the deposit banks for an equal period of time; and if a comparison be instituted between the amounts of service rendered by these institutions on the broader basis which has been used by the advocates of the United States Bank in estimating what they consider the domestic exchanges transacted by it, the result will be still more favorable to the deposit banks.* * * * * *
"It is believed that the law of the last session regulating the deposit banks operates onerously and unjustly upon them in many respects, and it is hoped that Congress, on proper representations, will adopt the modifications which are necessary to prevent this consequence."
This was the language of the last Message, and this is called war upon those banks. Certainly war should be made of sterner stuff ! But, Mr. Van Buren! he carries on war against them also! so say the same Opposition Senators. But, here again the charge is met by proof which annihilates it. Mr. Van Buren has spoken for himself on this point, and his whole conduct corresponds with his declared sentiments. In his letter to Mr. Sherrod Williams, he says:
"Although I have always been opposed to the increase of banks, I would, nevertheless, pursue towards the existing institutions a just and liberal course, protecting them in the rightful enjoyment of the privileges which have been granted to them, and extending to them the good will of the community, so long as they discharge, with fidelity, the delicate and important public trusts with which they have been invested.
"But all experience having shown that there is no delegated power more liable to abuse than that which consists in chartered privileges of this description, I would be astute in watching the course of the banks, and vigilant and prompt in arresting the slightest aspiration on their part to follow a bad example, by seeking to become the masters, when they were designed to be the servants, of the people."
Such has been the language and the conduct of General Jackson, and Mr. Van Buren, towards these banks; a conduct and a language utterly disproving the imputation of making war upon them. But this is not all: other proofs of forbearance, of indulgence, and of benefits extended to them, remain to be stated. When the deposite banks stopped payment last spring, the Government continued to receive their notes, at par, in payment of balances due, although these notes were 5, 10, 15, and in some instances 18 per cent. below par. This was a gain to them of that much, and an equal loss to the Government creditors, to whom they were paid out, and an immense injury to the character and popularity of the Administration itself.
Again, when Congress met at the extra session, extended time was given to all these institutions to pay up their balances --a time which has not yet expired, and which has enabled them to give time and indulgence to their own debtors. Far from injuring them, the Republican Administrations have confided in them to their own cost, and to the great injury of their own popularity. They had the confidence of Government when the public money was put into their hands. In placing the Public money with them, the fate of the Administration, in a large degree, was committed to them. We wished them well, upon the same principle that we wished ourselves well. Since our wishes have been disappointed, and the Administration and the country have been the chief sufferers, we make no war, but grant indulgence, exercise forbearance, and ask for pace. We want peace --that safe and permanent peace which results from separation of interests, and absence of all the causes of collision. True, General Jackson, and Mr. Van Buren, and all their friends, wish to see the banking system of the United States reformed. They wish to see great reforms introduced into the system; and, if it is not done, they believe that great mischiefs must eventually result to the community, and great injury to the banks themselves. They look for a great catastrophe, if great reforms are not effected.
A war upon the merchants is another of the offences charged upon General Jackson; and what is the evidence of it ? The commerce of the country nearly doubled since he became President; nearly one half of the whole amount of imports made free of duty; the duties greatly reduced on all the remainder; indemnities obtained from France, Spain, Denmark, and Naples, for spoliations committed under former administrations, and which former administrations in vain solicited; ships of war sent into every sea for the protection of mercantile interests; ministers and consuls sent to new points, and to further points than they ever went to before; outrages punished on the opposite side of the globe, even among the antipodes; time given to merchants for the payment of their bonds; debentures paid to them in specie, while they withhold specie from the Government ! Such are the evidences of this war upon merchants, of which we hear so much. So far from making war upon them, General Jackson's administration has done more for merchants than any one, or any two administrations, that ever preceded him. He has been their beneficent benefactor; and this is known to every citizen who knows the history of his country, and is acknowledged by every merchant whose heart is American.
The imputation of hostility to merchants is an old Federal accusation against Republicans. It was made against Mr. Jefferson, and his "terrapin policy" was long the theme of the politician, the press, the jester, and the caricaturist.
No, Mr. President, General Jackson made no war either upon banks or merchants; not even upon the Bank of the United States, for he never attacked its existing charter; and his opposition to a new one can only be looked upon as aggressive, and as amounting to war, by those who consider the bank above the Government, and entitled, like a royal progeny, to a perpetuity of existence. That great man made no war upon any institution; or upon any interest.
But, sir, we have seen some wars made --there are some still making-- and I will take the liberty to enumerate a few of them.
First, there was the war against the local banks generally, during the whole panic session, in which no term of reproach was too odious to be lavished upon them, and no statements to discredit them, no assertion to destroy confidence in them, no attempts to excite runs upon them, and to blow them up, were too shameless or too unscrupulous to find authors, abetters, and aiders, in the ranks of their present most officious friends.
Next was the war upon the safety fund system, and the safety fund banks, of the State of New York, which, for two or three sessions, raged with such violence on this floor. During all that time, nothing so corrupt as this system, nothing more certain than its rottenness and explosion, and nothing so dreadful as the prospect of having it imposed upon the whole Union in the event of an election of a certain citizen of the State of New York to the Presidency of the United States. In this war, I had the honor to extend a feeble aid to the Senator from New York, [Mr. Tallmadge,] in his patriotic defence of the institutions of his State against the repeated and violent assaults of his present coadjutor in politics from Kentucky, [Mr. Clay.]
Then came the war, which still continues, upon the constitutional currency of the country --a war in which gold and silver has received all the abuse which, in other countries, would be lavished upon counterfeit money. First ridiculed as visionary and impracticable; then denounced and stigmatized as a barbarism; then attempted to be forced out of the country by deportation; then attempted to be imprisoned, and shut out from the light of day, by shutting down all the banks upon it; then attempting to drive it off by turning loose upon it a pestiferous issue of shin-plasters and small notes; and now straining might and main to keep it down by keeping up irredeemable paper, preventing a resumption of specie payments, and forcing a currency of broken bank notes into the coffers of the Federal Government.
Another war which we have seen going on ever since the veto session, six years ago, and which we still see, is upon the general business of the country; turning off laborers, reducing wages, stopping work, shutting up factories; expanding and contracting the paper currency, so as to make money plenty one day and scarce the next; monopolizing bread and fuel, to double their price, while diminishing the capacity of the laborer to purchase; fabricating distress by every act of real oppression, and aggravating it by every art of fictitious exaggeration; looking forward to an "awful winter" as to a banquet of intellectual enjoyment; scarcely concealing their dissatisfaction with Providence for giving mildness instead of severity of weather, and insulting the victims of their oppression by doling out to them an ostentatious and contemptible charity.
Another of these wars, one which we have witnessed ever since the Presidential election in the House of Representatives, in February, 1825, is that which has been so appropriately denounced by the Senator from Ohio, who sits to the left, [Mr. Morris,] and which exceeds all others in enormity, because it is a war upon the fundamental principles of our Constitution, and upon the form of the Government under which we live. The revival of this war dates from the election of Mr. [J.Q.] Adams by the House of Representatives, in 1825, but its origin, is coeval with the foundation of the Government. Up to the first election of Mr. Jefferson, in 1800, this war was carried on openly and furiously, and the sentiment contained in the elder Mr. Adams's book on the American Constitutions, that the British Constitution, with its king, lords and commons, was the most stupendous fabric of human invention, had its open and public defenders. The second election of Mr. Jefferson sunk Federalism too low. It drove it into a state of hibernation, far north, from which it did not emerge for many years; and which left it without distinctive character, or object, until the Congress election of the second Mr. Adams. Then the ancient principles of the party revived, and the war recommenced upon the principles, and upon the form, of our Government, in the attacks which were made upon the capacity of the people to choose their own Presidents. This war then recommenced, and has continued ever since; for what is this eternal denunciation of General Jackson, but a denunciation of that immense majority of the American people, who have three times preferred him for President, and a fourth time approved his policy in the election of his successor ? What is this infinite accumulation of degrading epithets upon the mad, wicked, outlandish, and ruinous administration of General Jackson, but an application of the same epithets to the people who elected him, and who have approved his Administration ? What is this cry for a change of the "experimenters," but a cry for a change of the voters who elect them ? Beyond doubt, the capacity of the people to choose their representatives is attacked in these incessant assaults upon their representatives; and the zeal and unanimity with which this war is carried on, make it high time to consider it in its true aspect, as a deliberate waging of hostility upon the principles of our Constitution, and the form of our Government.
Finally, we see a war against an individual, against a retired citizen, an aged man, one that has done the State some service --a war of which there are but few examples in the annals of Christendom, or within the boundaries of the civilized world. General Jackson is no longer on the stage of action; he is no longer in any man's way. Through the portals of everlasting fame he has made his exit from the stage of public life, and has gone into that retirement never more to be withdrawn from it, which he has always sought, and from which his country has so often recalled him. Repose is the only boon that he now asks of the world, and such a man has certainly a right to tranquillity --a right to be free from invasion-- in the evening of his days, and in the shelter of his own house. But he is not free from invasion. Persecution follows him. A war of unexampled ferocity is waged against him; and the destruction of his character, public and private, and the laceration of his feelings, seem to be the relentless design of the assailants.
That I may do no injustice to any one by mistaken recitals, I will here exhibit some specimens of this warfare, as I find them preserved and perpetuated in the printed copy of a speech delivered on this floor. I read from a revised copy, bearing every mark of authenticity, and of deliberate preparation.
War and strife, endless war and strife, personal or national, foreign or domestic, were the aliment of the late President's existence. War against the Bank, war against France, and strife and contention with a countless number of individuals. The wars with Black Hawk and the Seminoles were scarcely a luncheon for his voracious appetite. And he made his exit from public life, denouncing war and vengeance against Mexico and the State banks.
When Mr. Benton had read this paragraph, Senator Linn inquired of him from whose speech he was reaping ?
Mr. Benton said he would answer the inquiry authentically, by reading the title page of the speech. He read:
"Speech of the Honorable Henry Clay, of Kentucky, establishing a deliberate design, on the part of the late and present Executive of the United States, to break down the whole banking system of the United States, commencing with the Bank of the United States, and terminating with the State banks, and to create on their ruins a Government Treasury Bank, under the exclusive control of the Executive; and in reply to the speech of the Hon. J.C. Calhoun, of South Carolina, supporting that Treasury Bank. Delivered in the Senate of the United States, February 19, 1838. Printed by Gales and Seaton, Washington City, 1838."
Sir, this is the speech from which I read. The paragraph is a brief one, but it is comprehensive; and in the eagerness of the speaker to get at the victim, the public interests, the existing interests of the country, are overlooked, and endangered. Who can now look for any indemnities from Mexico, or for any submission from the Seminole Indians, until after the next Presidential election is over ? Who can now count upon the quietude of Black Hawk, the removal of the Cherokees, or the peace of the Western frontiers ? The foreign and domestic policy of General Jackson is set down to the love of strife, and the spirit of vengeance; this must excite all foreign nations, and all Indians, to resist his policy. His personal difficulties are said to be countless, although we can count the whole population of the Union; they are said to be endless, although he is known to have had no such difficulties for a quarter of a century, and to have become the friend and benefactor of many of those with whom he has had dissensions. Granted that he has had personal difficulties, and violent ones, yet they can be counted, and they have ended. Violence subsides; malice never dies! and that is the difference between General Jackson's feuds, and those of some other persons. Sir, I have some knowledge upon this subject; and this letter, (holding up one from General Jackson) delivered to me since I rose to speak, the seal yet unbroken, can attest that his animosities are not endless. "War and strife, endless war and strife, &c. &c. were the aliment of the late President's existence." And this is to be said of a citizen who, at the early age of thirty-three, resigned the place of Senator on this floor to go home, and live upon a farm so retired as to merit, and to receive, the name of Hermitage; who, being called thence to the bench of the Supreme Court of his State, resigned that station to return to his farm; who, being called again to lead an army to victory and to glory, and to be made Governor of an important Territory, with a high salary, a third time resigned to go back to his farm; who, being for the second time placed as Senator upon this floor, still resigned to go back to his farm; who, being offered embassies and departments, refused to touch them; and who, being twice called to the Presidency of the United States, availed himself of the first moment of the expiration of his office again to return to his farm, never more to be dragged away from it. This is the man whose aliment is strife, whose luncheons are wars, who went off breathing vengeance !
But to continue the reading:
"His administration consisted of a succession of astounding measures, which fell on the public ear like repeated bursts of loud and appalling thunder. Before the reverberations of one peal had ceased, another and another came, louder and louder, and more terrifying. Or rather, it was like a volcanic mountain, emitting frightful eruptions of burning lava. Before one was cold and crusted; before the voices of the inhabitants of buried villages and cities were hushed in eternal silence, another, more desolating, was vomited forth, extending wider and wider the circle of death and destruction."
And this is the Senatorial description of General Jackson's administration! that Administration which has filled the country with prosperity at home, and covered it with honor abroad, and which has revived and restored the Republican spirit of our Government, and rallied the Republican party on the ground which it occupied under the illustrious Administration of President Jefferson.
Sir, it is not my intention to analyze this description, or to inquire into the truth of the allegations it contains. I leave that work to the moral sense of the community ! I leave it to those who have witnessed these astounding measures --heard this appalling thunder--seen this volcanic mountain-- and beheld this frightful river of burning lava ! I leave it even to those "voices hashed in eternal silence" --to the voices of the inhabitants of the cities, towns, and villages, buried, crusted over, and cold, under the volcanic eruptions vomited forth by this desolating mountain !
And what has General Jackson done to draw upon him this relentless and undying persecution ? Sir, he has done nothing but let the people elect him President, and then so administered the Government as to carry the star of his civil fame to the highest point in the political firmament, there to remain forever, searing the eyeballs of envy, but cheering the heart, and guiding the footsteps of patriotism, and shedding its benign influence on the freedom, happiness, prosperity, and glory of his country.
second half of the speech