Ideas for a Science of Good Government
in Addresses, Letters and Articles
on a Strictly National Currency, Tariff
and Civil Service
1883

by Hon. Peter Cooper, LL.D.

COIN AND PAPER CURRENCY.



UNITED STATES COMMITTEE ON AGRICULTURE.

WASHINGTON, D.C., May 3, 1882.


HONORABLE AND DEAR SIR :

Owing to the absence of both myself and Secretary for a protracted period from this city, your kind note of the 18th ult. was not laid before me, until this evening.  I recognize the importance of legislation by Congress at its present Session in regard to the currency, and I desire to bring to my consideration of this subject all the light, which intelligent experience in matters of finance can afford ;  and I, therefore, beg to tender you my thanks for a copy of your review of report of the Comptroller Knox, which shall have my fullest consideration.

Yours very respectfully,          
WM. MAHONE.

HONORABLE PETER COOPER,
9 Lexington Avenue,
New York City, N.Y.



Petition to the honorable Senate and House of Representatives of the United States.


HONORED GENTLEMEN :

Your petitioner, now in the ninety-second year of his age, respectfully prays, that the present Congress may not adjourn, until they have made the necessary and proper law, requiring, that all banking shall in future be carried on with United States Treasury Notes, receivable for all forms of taxes, duties and debts, both public and private—and that, after the expiration of the charter of our present banks, no paper money shall ever be allowed to circulate in this country in excess of the amount of the people’s money, actually found circulating as the currency at the close of the war.  For every dollar of that currency the people had given value to the Government, and it should only be increased as per capita with the increase of the population after every census.

Your petitioner further prays the Honorable Senators and Representatives to examine with care the following reasons, that prompted him to offer this petition :

Impelled as I am by an irresistible desire to do all, that is possible to call and fix the undivided attention of the Government on the appalling scenes of wretchedness and ruin, that would inevitably follow the re-chartering of the 2,300 banks, deceitfully called national—I cannot help addressing you on this occasion once more.

Such an army of banks, all united in one common effort to secure for themselves the largest amount of interest on their small specie capital, would find it for their advantage to expand and contract the currency to attain their object.

Only a few weeks ago (March 30, 1882), Hon. Richard Warner, M.C., from Tennessee, proved in Congress, that the banks, deceitfully styled national, have made out of the people the enormous sum of $,1,848,930,000 within the last sixteen years, leaving the national debt, at the present time, nearly as large as it was at the close of our terrible war for the nation’s life.

For one, I have the most fearful forebodings of the consequences, that must grow out of a re-charter of these grasping institutions, which are even litigating to be exempted from local taxes ! !  The American people are beginning to realize, that a national debt is not a blessing, as claimed by selfish monopolists, but a national curse, which a wise and parental Government should dread as we would a pestilence.

I have lately learned, that a secret organization has grown up in our country, which is known as the Knights of Labor, and that they already number 150,000, and are daily increasing from the strikes, that extend over the States.  They are under the guidance of able and talented leaders, who have the wisdom and courage to tell their working brothers what they must do to save themselves and families from the enslavement of a national debt, that enriches monopolists and non-producers.  They caution them against strikes for higher wages, and advise them to continue work and use their money to buy for each organized company a Gatling gun, with 150 rounds of ammunition, and three months’ provisions for their families ;  then they may, like honest and prudent men demand, obtain and maintain their “ inalienable right to life, liberty, and the pursuit of happiness,” as mentioned in the Declaration of Independence.

Such a body of industrious men, with such leaders, will not allow idle tramps as members of their order.  If our bankers would act wisely and prudently, they would adopt the language of the late John Earl Williams, for many years the honored President of the Metropolitan Bank of New York :

“ I would suggest, that Congress assume, at once, the inherent sovereign prerogative of a Government and exercise it, by furnishing all the inhabitants of the United States with a uniform national currency.  Surely the people, and the people only, have a natural right to all the advantages, emolument, or income, that may inure from the issue of either $1,000 bonds with interest, or $10 notes without, based on the faith and credit of the nation,” etc. . . .

In 1813 Jefferson declared :  “ Bank notes must be suppressed and the circulation restored to the nation, to whom it belongs,” etc. . . .

Webster predicted that conditions, which permitted the rapid accumulation of property in the hands of a few, remitting the masses to poverty, would soon destroy free institutions etc. . . .

In spite of warnings, uttered and written by sages, statesmen and financiers from Franklin, Jefferson and Webster to Senator Jones, President John Earl Williams and Treasurer Spinner ;  in spite of the seven and ten yearly periodic panics, that impoverished our farmers, manufacturers, mechanics and laborers, and enriched the banks and capitalists, Secretary Folger and Comptroller Knox seem now inclined to advise the re-chartering of these banks, deceitfully called national.  I wish these two financiers could see as clearly as Treasurer Spinner, before it is too late.

The charter of these banks, deceitfully styled national, was granted February 25, 1863, under the pretext of a war measure.  In 1864 they circulated but $31,235,270 of notes, furnished and guaranteed by the United States Treasury ;  in 1865 they circulated $145,137,800, which, from that date to 1880, increased to $343,834,167.  On these millions the people’s Treasury has paid them interest in gold ever since, while laborers and producers had to take their wages in paper.  Thus did the one hundred and twenty bankers, who were members of Congress, manage to legislate for their interests.  Now their first charter, being about to expire, they apply for a re-charter in a time of profound peace, when there can be no pretext for a war measure.  Such a power in the hands of heartless corporations is not only dangerous to our liberties and persons, but to our daily comforts ;  because, when they see fit, they contract their circulation and refuse accommodation to manufacturers and employers, who are consequently obliged to stop work and discharge the men and women in their employ, thus causing panics, poverty, misery and ruin.  Soon such contraction will reach farms, houses and stocks, which these favored banks and their friends can buy for one-half or one-quarter of their cost ;  because the honest owners cannot pay the interest and taxes thereon, all of which makes the rich richer and the poor poorer, as happened from 1837 to 1841, from 1547 to 1850, from 1857 to 1863, and from 1873 to 1878—when the laboring and producing classes were impoverished by special legislation, that enabled bankers and monopolists to deceive the people and bribe such as stood in their way. . . .

There was a somewhat plausible reason in 1863 to charter banks, deceitfully styled national—this reason was called war measure ;  but now, 1882, our country and the world are at peace ;  there is not even a war cloud.  Why then re-charter these banks against the letter and spirit of the Constitution, which contains no clause or word, that authorizes Congress to delegate the money power to anybody ?  Allow me to cite again Senator Jones’ emphatic language :

“ By interfering with the standards of the country, Congress has led the country away from the realms of prosperity, and thrust it beyond the bounds of safety.  To refuse to replace it upon its former vantage ground would be to incur a responsibility and a deserved reproach, greater than that, which men have ever before felt themselves able to bear.  We cannot, we dare not, avoid speedy action on the subject.  Not only does reason, justice and authority unite in urging us to retrace our steps, but the organic law commands us to do so ;  and the presence of peril enjoins what the law commands.”

May our Congress pass no more laws, giving away immense tracts of land to heartless corporations, thus creating land monopolies, like those that now curse the British Isles—and grant no charters to banks, that can contract and expand the people’s medium of exchange at their pleasure ;—for such legislation favors the few at the expense of the many, causes discontent among the masses and produces Nihilists, Guiteaus and men, who commit acts, like the one just perpetrated in Dublin, May 7, 1882, which disgraces the civilization of the nineteenth century.

As previously stated, I am now in the ninety-second year of my age, and have the satisfaction of knowing, that I have given to my country the best efforts of a long, laborious life.  In the course of my endeavours I have written and printed more than a million of documents, which I have sent to Congress, to the President and members of the Cabinet, and to all parts of our common country.

The burden of my theme has been to show, that the Constitution has made it the imperative duty of Congress to take and hold the entire control of all, that should ever be allowed or used as the money of the nation.  If the plan, set forth in a petition to Congress, to the President and his Cabinet on the 14th of December, 1862, in which I showed, that my ideas of finance were based on the opinions of such men as Franklin, Jefferson, Madison, Calhoun, Webster, etc., whose words and warnings I quoted, as I do in this document—had been adopted, the Government would have all the means it wanted in Treasury notes, and we should not have an enormous bonded debt in 1882.

Most respectfully,         
PETER COOPER.




PETER COOPER’S PROTEST AGAINST THE NATIONAL BANKS,
AS QUOTED IN “ NEW YORK HERALD,” MAY 10, 1882.


The venerable Peter Cooper has sent a petition to the Senate and House of Representatives praying, that the present Congress may not adjourn, until it “ has made the necessary and proper law requiring, that all banking shall in future be carried on with United States Treasury notes, receivable for all forms of taxes, duties and debts, both public and private, and that after the expiration of the charter of our present banks, no paper money shall ever be allowed to circulate in this country in excess of the amount of the people’s money, actually found circulating as the currency at the close of the war.  For every dollar of that currency the people had given value to the Government, and it should only be increased as per capita with the increase of the population after every census.”

Mr. Cooper in support of his prayer against the rechartering of the 2,200 banks, “ deceitfully called national, all united in one common effort to secure for themselves the largest amount of interest on their small specie capital, and who find it for their advantage to expand and contract the currency to attain their object,” quotes a vast number of authorities.  He suggests, that Congress should assume at once the inherent sovereign prerogative of a Government and exercise it by furnishing all the inhabitants of the United States with a uniform national currency.  In fact to substitute the United States notes for bank notes, and take away as soon as possible and forever all circulation from banks.  By this means their occupation would not be gone.  Mr. Cooper points out, that they would still be in a position to do a strictly legitimate business as banks of account and deposit, and asserts that the laws, which created them are also fully competent to abolish them.  This principle, simple, clear and undeniable, says Mr. Cooper, ought to be recognized as fundamental, and the only safe and proper basis, on which may securely rest all the circulating medium of the country, for the sole benefit of all the people, and not as now, for the profit of a class of stockholders, however deserving they may be in all other respects.  Franklin, Jefferson, Madison, Jackson, Calhoun and Webster are next cited by Mr. Cooper as being in favor of paper money, founded upon the credit of the Government and its resources, etc. . . .*




OPEN LETTER, TO THE MEMBERS OF THE BANKERS’ CONVENTION,
AT SARATOGA, AUGUST 17, 1882.


GENTLEMEN :  A long life has compelled me to believe, that Christianity, as Christ taught it, presents to the world the true science for the guidance of all National Governments, and of all individual lives.  There is no command more clear, plain and self-evident than the one, which declares, that “ all things whatsoever ye would, that men should do unto you, do ye even so unto them.”  This command applies to every act and every condition in life.  All men are made to feel, how they would like others to do unto them, and that feeling should form the true measure of duty we owe to those around us.

Science is a rule or law of God, by which the movements of the material creation are rendered intelligible to man ;  science itself is nothing more nor less than a knowledge of this law or rule, actually demonstrated by the experience of mankind.  Believing this, I have given the labors of a long life to the advancement and diffusion of scientific knowledge, feeling assured that, when Christianity itself is felt in all its purity, power and force ;  when it is relieved of all its creeds and systems of human device, it will then be found to be a simple system—a science or rule of life, to guide and regulate the actions of mankind.

Mankind, throughout the world, requires a complete science of immortality—one founded on the highest conceivable idea, that a human mind can form of all that is powerful, wise, pure and good.

The world requires a science, based on that which may be known and clearly seen throughout all the unfolding leaves of creation ;  one that can be known and read of all men, by that true light “ given to enlighten every man, that cometh into the world.”

Science is the lamp in the world’s path to light the way to all those wondrous treasures, stored up in Nature ;  to reward the head and hand of patient industry and toil.

It is now in the power of those, who favor the present system of National Banks to carry out this principle by adopting a plan, that will secure for themselves as a body of bankers, for our country, and for the world the greatest blessing, that ever fell to the lot of man since the world began.

To secure this greatest of all blessings, it is only necessary for the National Bankers to unite and ask Congress to give back to the people the amount of legal tender notes, that were in circulation at the close of the war, and which formed the nation’s currency.  This money was wrongfully taken from the people ;  for it must not be forgotten, that they had given labor and property for every dollar of that money.

When the attempt was made in the Senate to take that money from its rightful owners, and to convert the same into a National debt, Senator Sherman characterized that act for contracting the currency, as an act of folly without a parallel in ancient or modern times.  His whole speech made at that time was intended to show, that a nation’s currency could not be contracted without bringing ruin to the debtors and the laboring classes throughout our country.  He declared in the Senate in 1869, before he had been tempted above what he was able to bear, that—

“ The appreciation of the currency is a far more distressing operation than Senators supposed.  It is not possible to take this voyage without the sorest distress to every person, except a capitalist out of debt, or a salaried officer, or an annuitant.  It is a period of loss, danger, lassitude of trade, fall of wages, suspension of enterprise, bankruptcy and disaster.  To every railroad it is an addition of one-third to the burden of its debts, and more than that deduction to the value of stock. . . . It means that the ruin of all dealers, whose debts become twice their (business) capital, though one-third less than their actual property.  It means the fall of all agricultural productions without any great reduction of taxes.  What prudent man would dare to build a house, a railroad, a factory, or a barn, with the certain fact before him, that the greenbacks he puts into his improvement, will in two years, be worth thirty-five per cent. more than his improvement is worth ? . . . When that day comes, all enterprise will be suspended, every bank will have contracted its currency to the lowest limit, and the debtor compelled to meet in coin a debt contracted in currency ;  he will find the coin hoarded in the Treasury, no adequate representation of coin in circulation, his property shrunk, not only to the extent of the appreciation of the currency, but still more by the artificial scarcity, made by the holders of gold.”

And yet Senator Sherman subsequently was the author of the act to resume specie payments, which authorized the contraction of the legal tenders from $382,000,000 down to $300,000,000 ;  and under that act the legal tenders were reduced to $336,000,000, and the very disasters he had predicted, would follow such contraction of currency, were brought upon the people ;  and those disasters were only partially arrested by the Act of May, 1878, to stop any further destruction of the people’s money.

This act of Senator Sherman’s wrought a ruin like that, which was brought upon England by its efforts to resume specie payments after a suspension of twenty-five years.  This effort to resume specie payments, by contracting the currency, brought upon England such ruin, that at least five-sixths of the real estate of that country passed into the possession of a few moneyed men, who bought the estates at a small part of their former value.  Sir Archibald Alison, in his “ History of England,” says, the suffering produced in England by the act of contraction was greater, than had ever been occasioned in England by earthquakes, all the wars, pestilence and famine she had been compelled to endure ;  and he expressed the hope, that our Government world not be so unwise, as to adopt a similar policy to obtain specie payments.

Some time ago a law was passed by the House of Representatives to continue the people’s money, then found in circulation, as the permanent legal measure of all values for our whole country for all coming time.  When the news of the passage of that law was sent over the telegraph wires, it brought an acclamation of joy and gladness from all parts of the country.  When the bankers received this news, they, by their committees, came down on Congress and brought such influences to bear on members, as proved sufficient to defeat a law, that would have saved some ten thousand millions of property from passing out of the hands of those, who had earned it, into the hands of those, who had money enough to buy up the wrecks of ruined fortunes, resulting from the contraction of a nation’s currency.

The great mass of the people are coming to see and know, that the Constitution makes the most ample provision for supplying every want of the Government, as it declares in the most unmistakable language, that “ Congress shall have power to levy and collect taxes, duties, imposts, and excises, to pay the debts and provide for the common defence and the general welfare of these United States.  But all duties, imposts, and excises shall be uniform throughout the United States.”

When our late war began, calls for loans were made in strict conformity with the requirements of the Constitution, in the shape of Treasury notes, made receivable for taxes, duties and debts, and fundable at an interest of five or six per cent.  Those loans were promptly taken, as soon as offered, and more money was offered than could be taken under the call.  The duty of Secretary Chase was plain and positive, etc. . . .

If Secretary Chase had not, at that time, been afflicted with the Presidential malaria he would have found no difficulty in understanding Thomas Jefferson’s plain, commonsense directions.  It would have saved for our country one-half the expense of the late war, and would have saved Secretary Chase from the mortification of saying, that his efforts to establish a system of national banks was the great mistake of his life.

President Grant, in his first message to Congress, says he found the currency the best our country had ever possessed ;  and there was no more in circulation than was needed for the dullest period of the year.

President Garfield makes the following declaration :

“ Whoever controls the volume of currency, is absolute master of the industry and commerce of the country,” etc. . . .

Nearly all the great statesmen and financiers of our own and foreign countries have, in the most decided manner, given their opinion in favor of the issue of Treasury notes, as the best means to meet the wants of the Government and people, etc. . . .

Our national Constitution holds every member of the Government bound under the solemnity of his oath of office to make his every legislative act an effort, or intent to establish justice, as that is the only possible means, by which domestic tranquility can be secured, provision made for the common defence, the general welfare promoted and the blessings of liberty secured for ourselves and our posterity, etc.

I became convinced by what I have seen, that all trade must continue to be a kind of game of chance, so long as the business of the country is allowed to depend on banks, that promise to pay specie on demand.  The same causes, that have produced periodical panics in the past, will bring them in the future, unless prevented by a national currency, over which our Government can exercise entire control.  I determined, then and there, that it would never be safe for me to allow my business to depend on notes, discounted at banks, which, to save themselves, are often compelled to ruin their customers.  I saw that, even with a good man at the head of such a bank of issue with its branches in every State, it would be in the future as in the past, one of the grandest contrivances to demoralize a nation.

Banks of issue have it in their power to make money plenty, by loaning to the community an extra amount of paper money, which will cause all property to rise in price and the withdrawal of that extra amount of money from the wants of trade, will as certainly cause all the property of a country to fall in value, as it did when the bankers of our own country persuaded our Government to contract our national currency to about half of its volume, in order (a ridiculous pretence) to strengthen the credit of our country.  Our Government has put in the place of the currency burned, a national debt, which must ever hang as a millstone about the neck of the toiling masses, and on which the laboring classes have already paid in gold interest an amount about equal to the original debt, and which interest they are expected to go on paying for years, and then, at last, to pay the principal.

This unjust course of legislation has driven millions of laboring men into a condition of enslavement to the payment of the national debt, which must be paid out of the proceeds of labor, etc. . . .

Webster predicted, that conditions which permitted the rapid accumulation of property in the hands of a few, remitting the masses to poverty, would soon destroy free institutions.

I do most sincerely hope and trust, that the united opinions of so many of the greatest and best men our country has ever produced, will be sufficient to prevail on all owners of national banks to confine their business in the future to discounting and receiving deposits, instead of depending on a dangerous power, which our Constitution has vested in Congress.  Remember Jefferson firmly declared that “ bank paper must be suppressed, and the currency of the country must be restored to the Government, to whom it properly belongs.”

I think bankers will voluntarily adopt the advice of Jefferson and thus secure to all the greatest blessing, that ever fell to the lot of man, and ward off those terrible evils, that are sure to follow our present system, as effects are sure to follow the causes, which produce them.

Mankind as individuals, communities, States or nations will only improve and better their condition, just in proportion as they come to see, know and understand, that what a man sowetlh, that must he also reap somewhere, somehow and at sometime, by the operation of laws so wise and so good, that they will never require to be altered, amended or revoked.  There may at some future day be a whirlwind precipitated upon the moneyed men of this country, if they do not deal justly.

Pertinent to this subject are the following words of Rev. Henry Ward Beecher :—

“ Here at present is the strife going on between employer and employed, between labor and capital—the former demanding a portion of that, which it has helped to create.  We hear already the suggestions of the devil inspiring men, who are poor to hate the men, who are rich, and society is beginning to torment itself as to the consequences.  Now, if the rich men are wise they will lay aside at once this devilish idea, that they can swell before the community in vast array and not attach themselves to the humblest of the community.  If the rich men by and by are overwhelmed it will be their own fault.  The most dangerous thing they can do, is to separate themselves from the masses.  If there be any class of men, that are bound to go down and ally themselves to the poor with full hands and full hearts, it is the men in this community, who have property.  It may not be done now, but there is a storm in the sky, and if by and by there should come revolution, massacre and misrule, it is because the spirit of the Gospel has been set at naught by the men, who had the power in their own hands.  It will not do for a man to say, ‘ I sympathize with my poor brethren.’  What do the poorer brethren think about it ?  Between the horse and the man, who holds the whip is a wide difference, and the horse is the best judge of how the whip feels.  In society the men, who have got hold of the handle, are not as good judges as the men, who feel the lash.  In England there is an autocracy established by law, and years of experience have taught the titled class, that they have duties and responsibilities as well as wealth and position.  In America we have no aristocrats except those, who have sprung up in a night—as toadstools do in the dung-hill.  Nothing will save us from the contest of different classes of society, except that personal humanity and personal sympathy, which shall unite the top and the bottom of society ;  and you must not carry up the top of society any faster, than you carry up the bottom.  You must not say ‘ We will educate our children, but not the children of the poor.’  In our day, let us be wise beforehand.  I will close with some words of Ruskin, who is eminently wise, when he is not eminently foolish.  He said to his class, ‘ Break bread often with the common people.’ ”

In order that we may realize the greatest possible good for all it is only necessary, that our Government should give us an unfluctuating measure of all values ;  with a Postal Savings Bank, that will receive all unoccupied money, at an interest of two and a half per cent.;  provide cheap transportation for all products of our country ;  a complete civil service ;  and a tariff of duties, sufficient to meet the wants of our economical Government ;  thus relieving our country from all forms of internal taxes for the support of our Government.

All our financial legislation has been calculated to build up and maintain a union of more than two thousand National Banks, for banks are a unit in their endeavor to obtain for the use of their money the largest amount, that the laws will allow them to receive.

The persons, having charge of the banks will always be on the alert to get their powers enlarged by legislattive enactments, though I am compelled to hope, that the day will come, when the bankers themselves will do themselves everlasting honor by asking Congress to expunge all those unjust financial laws from the statute books of our country, as a disgrace to the civilization of the age.

The first of the laws passed for the preservation of our nation’s life was for the issue of Treasury notes, that were made a legal tender and convertible at the pleasure of the holder, into five and six per cent. bonds.  These notes were always as valuable as gold, until the bankers persuaded a majority of Congress to pass an act, that took away from the legal money its power to pay duties on imports and interest on bonds.  This was an invalidating act and clearly at variance with both the spirit and the letter of the Constitution.



   

FINANCE CATECHISM.
(From the Daily Express.)

“ REPUBLICAN.—Why do the Greenbackers or Nationals oppose the national banking system ?

NATIONAL.—Because it is unjust to the people.

REPUBLICAN.—But will you make it plain, so that all can see it as you do ?

NATIONAL.—We will try.  Let us go into the bank across the street and prove it by the banker himself.

NATIONAL.—Mr. Banker, how much money did you loan to the Government ?

BANKER.—One million dollars, sir.

NATIONAL.—What security did you take for the loan ?

BANKER.—I took the Government’s bond payable in twenty years, drawing six per cent., gold interest.

NATIONAL.—Do you still hold that bond ?

BANKER.—No ;  I pawned it to the Government, and received on it $900,000 of currency.

NATIONAL.—What did you do with the $900,000 of currency ?

BANKER.—I paid it out to the people for property.

NATIONAL.—What security have the people, that the money you paid them is good ?

BANKER.—My bond is on deposit as collateral for its final redemption by the Government.

NATIONAL.—Then you have parted with nine-tenths of your claim against the Government by passing it over to the people in exchange for their property ?  Or, in other words, the people have refunded to you ninety per cent. of your loan to the Government, and taken a lien on your bond ?

BANKER.—Yes.

NATIONAL.—Do the people draw from the Government nine-tenths, or their proportion of the interest on the bond ?

BANKER.—Oh, no, I still continue to draw the entire interest, without being taxed ;  while the people, who own nine-tenths of the claim, draw no interest, and are taxed to pay mine.

NATIONAL.—Then really the Government owes you but $100,000 of the million, you having transferred $,900,000 of the claim to the people, and at the same time the latter are taxed to pay you interest on the whole ?

BANKER.—Those are about the facts under the law.

NATIONAL.—To what extent does the law allow you, bankers, to carry this system of speculation ?

BANKER.—We are not limited by law.  We can carry it to the extent of the bonded debt of the nation.  It is one of the nicest schemes ever invented.  It is like a ratchet wheel ;  it takes all and gives nothing.  The whole people are taxed to pay us interest on what they do not owe, while we are exempt even from our own burdens.

NATIONAL.—Do you expect to hypothecate more of your bonds for currency and transfer them to the people for property ?

BANKER.—Yes, as soon as we can get the infernal greenbacks out of competition, and property values are depreciated enough to enable us to rope in three dollars worth for one of our currency.  This we intended to do, when we got a clause inserted in the Redemption Act to allow us to inflate our bank currency without limit.

NATIONAL.—What amount of bonds do you now hold, which you are at liberty to put up for bank currency ?

BANKER.—Nearly ten thousand million dollars, with what we already have up.

NATIONAL.—By handling the $2,000,000,000 of bonds and the nine-tenths or $1,800,000,000 of currency, as you did your million dollars and $900,000 of currency, what would be the result, financially, of your investment ?

BANKER.—The result will be, we shall carry but one-tenth, or two hundred millions of the public debt, while drawing interest on the whole.  The people will carry nine-tenths of the burden, draw no interest, but have the privilege of paying ours.

NATIONAL.—How much will your annual interest amount to ?

BANKER.—About one hundred million.

NATIONAL.—What do the taxpayers get in return ?

BANKER.—Nothing.

NATIONAL.—Then you contracted to extend a certain favor to the Government, for which you were to receive $100,000,000 in gold per year, from the people.  But through the agency of your national banking machinery, you are enabled to make the people perform nine-tenths of your contract, while you receive the entire reward.  Is not this a most outrageous robbery—a swindle upon the people ?

BANKER.—(John G. Deshler, President Franklin National Bank, Columbus, Ohio).—If the people are such d——d fools, as to vote for men to put saddles on their backs, spurs on my boots, and then invite me to ride, I am not going on foot.  If it is robbery, the people, who sustain the party, that authorized the robbery, are to blame and not the robbers.”


If this is not an overdrawn picture of our present system of banks, deceitfully called national, I would most sincerely implore the owners of these banks to ward off such a train of evils, as fell to the lot of Belshazzar, as a consequence of his not taking the advice of his prophet Daniel, when he said, “ O king, let my counsel be acceptable unto thee, and break off thy sins by righteousness, and thine iniquities by showing mercy to the poor.”  By not availing yourselves of the law, passed by a corrupt Congress, you will save yourselves and your country from the disasters indicated by the handwriting on the wall !

Bastiat, the French political economist, uttered a great truth, when he said :

“ When a Government fails in its duty to organize and execute Constitutional laws, such a failure opens the door for the introduction of all forms of corruption and plunder, and plundering will go on just as long as plundering is allowed to be a profitable business.”

It is time, that we made plundering unprofitable ;  and I hope I shall be so fortunate as to convince the owners of National Banks, that this is their great opportunity to secure to themselves, to our country, and to the world, one of the greatest blessings, that ever fell to the lot of man.

If this should come to pass, I should be able to say with one of old :  “ Now, O, Lord, let thy servant depart in peace ;  for mine eyes have seen thy salvation.”

PETER COOPER.




NEW YORK, June, 1882.

HON. A.A. HARDENBERG, M.C.

DEAR SIR :  I received your kind letter of May 24, with pleasure, seeing that your speech was misreported, as the term “infamous” does not occur in it.  Honest difference on any subject is fair, whereas personal abuse is unfair.

Throughout your discourse you speak of the danger of withdrawing bank reserves, amounting to $128,000,000, if the banks are not re-chartered ;  but you seem to overlook, that Congress alone has power to replace this amount by legal tender Treasury notes, a power, which it cannot delegate.

Page 5, you say :  “ My position is simply this :  if you compel these banks to divide up all their reserves, you will thereby force a contraction of the currency to the extent of $128,000,000, which no greenback theory can provide against.  And the men, who are now struggling to make a living for themselves and their families with their wages of a dollar and a half or two dollars a day, will be presenting themselves before you here, as they did during the years of 1877 and 1878, in their meetings every night about your Capitol, demanding some protection, demanding that some action be taken by you, that would furnish them with bread or with labor.”

In my humble opinion, legal tender Treasury notes would amply provide against the dividing up of all the bank reserves.

In your speech you do not tell these “ struggling men,” that their parental Government is paying four per cent. interest in gold on $343,834,000, circulated by 2,200 banks, which ask now to be rechartered for twenty years longer.  You do not tell them, that the interest on this sum amounts to $13,753,360 per year, and $275,067,200 in twenty years, besides the cost of keeping the deposits, besides liquidating the banks, that fail through mismanagement, and beside the lost and mutilated bills during twenty years, all of which belong to the people, and cannot be given away by Congress without violating the Constitution.

You observe, page 6 :  “ First educate the people, not to communism, not to socialism, but to the principles of Democracy and of a pure Government.”

I think it will be difficult to educate the American people of 1882 to perceive “ principles of Democracy and of a pure Government ” in a Congress, that legislates $275,067,200 in favor of 2,200 banks, managed by non-producers, at the expense of toiling producers, who must ultimately pay this enormous sum in direct and indirect taxation.

The people are realizing the flagrant errors of such legislation.  They begin to know, that Congress alone has the power to save this money by passing a law, authorizing the issue of legal tender Treasury notes, based on the property of the nation, which must be ever preferable to any banking corporations.  What can, what will, what must they think and say of representatives, who thus legislate away hundreds of millions in favor of a few rich non-producers at the expense of the toiling masses ?

No wonder, you find (as you say page 2) these words about the national banking system, uttered by Mr. Burrows, of Missouri :  “ It is one of the most wicked, defenceless, inexcusable, flagrant cases of a popular swindle, that ever came before Congress, not excepting the land-grant, Credit Mobilier, granite contract, river and harbor, whisky bill, or other swindles, that have disgraced the congressional legislation of the past, or threaten it at the present moment.”  This is consoling, showing, as it does, that the people have still representatives, who dare protest and say their souls are their own.

I can see no reason why Congress should not do the business intrusted to them by the Constitution, which declares “ Congress shall have power to coin money, and regulate the value thereof.”  I have looked in vain for a word or clause, allowing Congress to delegate this power to any corporation, either within or without Congress.  If they can delegate the power to issue money to banking corporations, they can delegate the power to regulate commerce between the States to railroad corporations.

You say, page 6 :—“ If I had my own way I would fund the $246,000,000 of legal tender now afloat.  I remember when meetings were held here and members of Congress were called out to give their opinions and a clamor was raised for the legal tenders, which had been retired, to be reissued.  Congress then voted, that the Secretary of the Treasury should reissue these legal tenders, and they are now afloat among the people to-day.”  Yes, legislate to fund these legal tenders now afloat among the people, and pay capitalists and bankers even as low as three per cent. interest in gold, and it will amount to the modic sum of $10,380,000 per year.  While they are afloat they cost nothing, bear no interest ;  and the lost and mutilated bills are clear profit to the nation.  Yet, against the popular clamor, against the decision of Congress, and against the spirit and letter of the Constitution, you would even now fund them, if you had your own way.  All I can say is, you must have great confidence in your individual judgment.  Your funding of these legal tenders, now in the hands of the people, costing nothing, would be like funding the $60,000,000 of small paper currency of five, ten, twenty-five and fifty cent. bills, so portable and so convenient to enclose in letters, that the people preferred them to copper, nickel and even silver ;  but they were withdrawn from circulation and turned into a national debt, bearing from six and four per cent. interest in gold, amounting to $3,600,000 at six per cent. per year, and to $2,400,000 at four per cent. per year.  Ten millions of that small paper currency amounting to sixteen per cent. have not come in, and may be considered as lost.  Had they been issued by the banks, they would have this sum instead of the nation.  To allow the loss and mutilation of the $342,834,000, now circulated by the banks, is a legislative favoritism not dreamed of by the people, who must be educated to realize such unfortunate legislation.  Even at one per cent. it amounts to $68,766,800 in twenty years.  Such has been our financial legislation since the close of the late war, and such it now is, if these banks are re-chartered.

Page 2, you have this tender effusion concerning me (no wonder your friends applauded you):

“ Why, sir, it was but two days ago, in my morning mail, came a letter signed by generous-hearted Peter Cooper, of New York, a man ninety-two years of age, a man who has been known, honored, and trusted by the American people ;  whose whole life has been one of benevolence, piety, and justice, and now in his declining years, when the shadows of the next world are gathering thick around him, and when his mind cannot be in the course of Nature as clear and bright and strong as it was, indorses doctrines the most unwise in our financial history.  His name is too honored in our history to permit the foundations of a proper conservatism to be swept away.  In that pamphlet, to which I have referred is quoted a suggestion, which I venture to assert few of you would be willing to give countenance, and I am quite sure Mr. Cooper does not.  What is that doctrine ?  Read it, Representatives of the people, and you will understand it better.  You will see that, instead of strikes against labor, suggestions are made to men to save three months of their wages to buy Gatling-guns, and three months of provisions, to crush out monopolies of whatever kind.  And this, Mr. Speaker, in a representative Government of the American people.  Crush where you can monopolized power, but let it be done by proper process of law.  Why, Sir, what can there be behind all this crusade upon the national banks ?  Men are tender in their utterances about it, as if they were afraid to speak their minds.  I believe in educating the people and in elevating them to a full knowledge of these great questions rather than pander to sentiments born of hasty and unreasoning prejudice.” [Applause.]

Though I am in my ninety-second year and “ shadows of the next world are gathering thick around ” me, I can perceive in your speech this contradiction :  You speak feelingly of the distress, that would result to the laboring men from dividing up all the bank reserves, which would “ force a contraction of the currency to the extent of $128,000,000.”  Next you declare :  “ If you had your own way, you would fund the $346,000,000 of legal tender now afloat.”  In the heat of debate you probably did not realize that, in doing so, you would “ force a contraction of the currency to the extent of ” $346,000,000, which would be more than double the amount of the bank reserves, amounting to but $128,000,000.  In spite of my age and the clouds around me, I perceive a difference between $346,000,000 and $128,000,000, although the former are legal tender and the latter bank reserves.  To me contraction is contraction, whether it assumes the shape of funding legal tender or dividing up bank reserves.  I also perceive a decided difference between $346,000,000 of legal tender and $343,834,000 of bank bills, inasmuch as the former cost the people nothing but the issuing, whereas the latter cost the people $13,74 53,360 per year, and $275,067,200 in twenty years.  Hence there are 275,067,200 reasons for keeping “ the legal tender afloat,” and for not re-chartering the banks, whose bills may at any time be replaced by legal tender Treasury notes, saving the nation $13,753,360 a year, and $275,067,200 in twenty years, besides the cost of keeping bank deposits, liquidating badly managed banks, and lost and mutilated bills, which should ever belong to the nation.

At the close of the war, Congress should have allowed the full amount of paper currency to circulate ;  because the people had furnished value for every dollar ;  and it should not have been augmented, except per capita, with the increase of population.  As the bank charter is now expiring, their currency should be replaced by legal tender Treasury notes.

In your letter you allude to “ doctrines the most unwise in our financial history.”  These same doctrines are fully stated herein.  I am ready to leave these doctrines to the decision of my countrymen.  Next you refer to “ a suggestion quoted ” in my “ pamphlet,” and invite “ representatives of the people ” to “ read that doctrine.”  In my pamphlet and petition I state what I found in the Press, and express my opinions, which are based on quotations from the Declaration of Independence, adopted by the world as a catechism for Republican forms of Government.  If that is wrong, I am wrong.  I state stubborn facts ;  for strikes have been, and are spreading all over the country as forerunners of revolution ;  if Congress does not heed them, I pity its members ;  for the trouble will ultimately be attributed to them, especially when the suffering masses realize the wholesale class legislation, that has been, and is going on since the close of our late war.  We have no Czar, no Sultan, no king ;  the people will look to Congress for redress of their grievances.

You state in your speech, that “ the men, who are now straggling to make a living for themselves and their families with their wages of a dollar and a half or two dollars a day, will be presenting themselves, etc., as they did during the years of 1877 and 1878, in their meetings every night about your Capitol, demanding some protection ;  demanding, that some action be taken by you, that would furnish them with bread or with labor.”

For such reiterated grievances the Declaration of Independence has this bold statement :  “ All experience hath shown, that mankind are more disposed to suffer, while evils are sufferable, than to right themselves by abolishing the forms, to which they are accustomed.  But when a long train of abuses and usurpations, pursuing invariably the same object, evinces a design to reduce them under absolute despotism, it is their right, it is their duty, to throw off such Government, and to provide new guards for their future security.”

I consider the persistent class legislation of Congress since the war, a worse despotism than that of Great Britain before the Revolution ;  because it reduces the laboring classes to periodic distress and starvation, that are worse than any despotism ever was ;  for monopolizing corporations, whether in the shape of banks or railroads, have no soul.

In my pamphlet and petition I point out those grievances.  I am sorry you do not like them.  I know they have been, are, and will be adopted by independent and unprejudiced persons.

I always have been, am, and ever shall be with the poor toilers and producers ;  therefore I desire Congress to legislate for the poor as well as for the rich, who can take care of themselves.  I think, if you considered my side of the question carefully, you would change your opinions concerning legal tender Treasure notes and bank circulation.

At the close of the war the House of Representatives passed an act, declaring that the people’s money, then found in circulation as the Nation’s currency, should be and remain the people’s legal measure of all values, and should only be increased, as per capita, with the increase of the inhabitants of our country.

Such a currency was passed by a vote in the House, and was only prevented from becoming the permanent legal money of our country by the combined influence of the banks and bankers of our own and other countries.

All must see, that such a law would have secured to our country a currency as uniform in its purchasing power as the yard, pound weight, and bushel measure, etc. . . .

I might here quote Rev. Henry Ward Beecher’s sermon, which would show, that I am not alone in foreboding the evils that will be brought on our country by a persistent course of financial class legislation.

Sir, by it you might realize, that thoughtful men are anxious concerning our country’s welfare ;  hence let the people’s Representatives now assembled in Congress be up to the emergency, and enact laws, tending to conciliate employers and employed, rich and poor—laws, that will diminish the burden of taxpayers.  First and foremost among such laws should be a refusal to pay interest on the $343,534,000 bank deposits, and replace them by legal tender Treasury notes, thus saving $13,753,360 per year.  Next, use the $150,000,000 now in the Treasury to cancel a part of our enormous interest-bearing debt ;  this, at four per cent. interest, will save $6,000,000 per year.  While in the Treasury, it is a temptation to corruption and bribery, no matter what party has the handling thereof, whether Democratic, Republican, Independent, or Greenback.  Lead us not into temptation should be the motto.  Men, who have loose money, are inclined to spend or become misers.

These two items would be a yearly saving of $20,000,000, which employers and employed would soon feel.  Surely, Congress might discover other leakages, and arrest them by just and economic legislation.  When this is done, let Congress exhort the employers and strikers to adjust their differences on the promise of better times.  I myself, as an employer, and friend of the employed, think matters might be so arranged as to suit all interests, if those who are now striking for higher wages could but know the struggles, that many of their employers are compelled to make, in order to be sure to be able to pay their men, and leave something on their balance-sheet to compensate them for their labor and the risks, which all employers are obliged to meet.  When laborers take their employers’ risk and troubles into consideration, they will rather pity their employers than to throw unnecessary difficulties in their way.

Perhaps the greatest danger, that threatens our free institutions, is, that the strikers will allow themselves to be used by unscrupulous politicians, who will lead them and their country to destruction ;  labor suspensions should be few and far between ;  for they create idleness, which soon conducts to corruption, drunkenness, and vice.  To contend for an eight-hour system of labor is a sad mistake.  I, as a working man, claimed it as my privilege to spend ten and twelve hours per day in bodily and mental efforts to elevate the condition of those, who have nothing to sell but their labor.  Had I not done so, I should not have been able to found the Cooper Institute.

If men would for a moment consider, that an eight, instead of a ten-hour system, would diminish production of every kind one fifth, or twenty per cent., and increase the price of the necessaries of life in the same ratio, they would stop thinking of eight hours work per day ;  for they would realize, that a bushel of potatoes, costing $1 under a ten-hour system, would sell at $1.20 under an eight-hour system ;  so would a suit of clothes, costing $20 under a ten-hour system, sell for $24 under an eight-hour system ;  so would a dwelling, renting for $25 per month under a ten-hour system, rent for $30 under an eight-hour system.  We might multiply examples ;  but these will suffice.  Such theories are attractive to shallow thinkers ;  but they only tend to disturb social order and aggravate the condition of honest laborers and mechanics, without benefiting either employers or employed, who must ultimately meet and settle matters, after much ill-feeling, loss of time and production.

As you are President of a bank, you will allow me to add here the following suggestions from John Earl Williams, President of the Metropolitan Bank of this city :

“ I would suggest :  That Congress assume, at once, the inherent sovereign prerogative of a Government, and exercise it by furnishing all the inhabitants of the United States with a uniform national currency.  Surely the people, and the people only, have a natural right to all the advantages, emolument, or income that may inure from the issue of either $1,000 bonds with interest, or $10 notes without, based on the faith and credit of the nation ! ”

      I remain, yours faithfully,

PETER COOPER.

Hon. A.A. Hardenbergh, M.C.



* The Herald quoted nearly the whole petition.