Register of Debates in Congress, Comprising the Leading Debates and Incidents of the First Session of the Twenty-Third Congress Page: 2,865
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2865
OF DEBATES IN CONGRESS.
2866
March 3, 1834.]
Virginia Resolutions.
[H. or R
the Secretary shall immediately lay before Congress, if in
session, and, if not, immediately after the commencement
of the next session, the reasons of such order and direc-
tion."
The truth is, that the public money, no matter where it
is, to the credit of the treasurer of the United States, is
in the treasury. The public money, while in the Bank
of the United States, is in the treasury; and when it is
removed thence by the officer who is authorized so to
"order and direct," and placed elsewhere, it is still in the
treasury. It is said that the Secretary of the Treasury
has undertaken to do what the whole Government cannot
do, to wit: lend out the public money to support the
credit of local banks. I take it for granted the principle
is true; but if the deposite of a portion of the public funds
in a State bank be a loan to that bank, and therefore ille-
gal, is it not equally illegal, and equally a loan, to deposite
it in the Bank of the United States? The deposite of money
in a bank is not a loan at all. It is selected as a place for
keeping the public money until it is wanted. As to the
authority of the Secretary of the Treasury, adinterim, and
in the absence of special legislation, to select the place.of
keeping the public money, I have only to say, that it seems
to have been the universal construction of the department
from 1789 down to the present time—constantly practised
on, and frequently brought to the notice of Congress, who
have thereby given a silent acquiescence in it. Mr. Hamil-
ton, while he was Secretary, exercised this authority, and
detailed, in a report to Congress in 1794, the practice of
the department under the interpretation of the law then
adopted. When the old Bank of the United States ex-
pired, in 1811, Mr. Gallatin was Secretary of the Treas-
ury, and, as such, selected the places of deposite, and
prescribed the stipulations which were to be made.
Mr. Crawford, both before and after the establishment
of the present bank, pursued the same course. And the
bank charter itself, in two of its clauses, recognises this
authority. The sixteenth section authorizes the Secretary
of the Treasury to direct that the deposites shall not be
made in the Bank of the United States. Now, if the
Treasurer is authorized, under the law of 1789, to select
the place of deposite, he may immediately order them
back, which would render nugatory the authority given to
the Secretary. Another clause of the bank charter re-
quires the bank to give facilities for the transfer of the
public money whenever required by "the Secretary of
the Treasury." Thus distinctly recognising that officer
as entitled to direct where the public money shall be
placed.
I do not mean, Mr. Speaker, at this time, exhausted as
is my strength, and worn out as the patience of the House
must be, to enter into an examination of the reasons al-
leged by the Secretary for the removal of the deposites.
The reasons alleged by him, if substantiated, are, in my
judgment, such as justified the withdrawing and withhold-
ing the public deposites, so far as the rights of the bank
were concerned; and enough of these charges seem to be
admitted or established to my satisfaction, to have war-
ranted the act of removal in point of legal authority. I
think, however, that it was effected in a way which was
hasty and ill-judged. The sudden and unexpected man-
ner in which the determination to change the place of de-
posite was announced, without notice to the bank or to
the country, was, I think, unwise and prejudicial to the
interests of the community. That the bank itself has con-
tributed by its course to increase the evils arising from this
proceeding, I can have no doubt. But I think it extra-
ordinary doctrine, indeed, that we are obliged to keep the
public money in a bank which has violated a fundamental
article of its charter, which, in effect, excludes the Gov-
ernment directors from all participation or knowledge of
its important concerns; which, in spite of the express di-
rections of the charter that seven directors shall consti-
Vol. IX.—180
tute a quorum to do business, commits to a sub-committee,
chosen by the President of the bank, the transaction of
business most materially affecting the general interests of
the community, and which finally expends large sums of
money belonging to the public as well as the other stock-
holders, for the purpose of controlling the politics of the
country.
This last charge it has been attempted to slur over and
ridicule, as unworthy of serious notice, as well as untrue in
fact. I regard it, however, as important in principle, and
it seems to be sufficiently established in proof. The
printing accounts of the bank prior to 1829, when Gene-
ral Jackson's first message was issued, had not ordinarily
exceeded about seven or eight hundred dollars per an-
num. From that time, its expenses for printing docu-
ments and essays rapidly and enormously increased; and,
in 1832, if I mistake not, the amount expended under the
resolution authorizing the president of the bank to pro-
cure and circulate such documents and pamphlets as were
"calculated to enlighten the public mind as to the nature
and operations of the bank," (I think that is the lan-
guage,) swelled up to the amount of $26,000: 1832 was
the year of the veto, and of the presidential election. In
1833, the year after the most serious " assault" was made
by the President on the credit of the institution, and when,
therefore the motive of defending the bank against these
" assaults" was strongest, the expense was only $3,000.
But the presidential election was then over. " Res ipsa lo-
quitur." The bankdeclares its determination to go on in
this course of expenditure, and, as it claims its right to do
it, I presume it is now employing its funds in this way.
Perhaps it has the mere corporate right of spending its
money as it pleases. But this Government has the right
of keeping the public money where it pleases, and I re-
gard such an employment of the corporate powers of the
bank as a dangerous and unjustifiable use of its power,
and think we may rightfully employ all the powers over
the public money which we have not surrendered to the
bank to check its career. We have reserved the right to
change the place of keeping the public money.
To illustrate my idea as to this abuse of the bank, let
me ask what would be said, what ought to be said, if the
Congress of the United States were now to pass a resolu-
tion declaring that the Bank of the United States was a
dangerous institution to the liberties of the country, and
that it was unconstitutional, and, therefore, that the Pres-
ident of the United States should be authorized to procure
and circulate such pamphlets, essays, and documents as
he might think proper, "to enlighten the public mind as
to the nature and operations of the institution, and that
the whole treasury of the United States should be put un-
der his control for that purpose?" Is there a man who
would dare to face his constituents after giving a vote for
such a resolution? And yet this is precisely what the Bank
of the United States has done with its treasury, to every
intent and purpose.
As an authority to prove that this control over the de-
posites may be used to prevent the bank from mingling in
the politics of the country, I will read an extract from a
report made to this House in 1830, which has received
the sanction of the bank at least; for the printing and cir-
culating some fifty thousand copies of it, constitute one
item in the "printing accounts of the bank."
It is from the report of the chairman of the Committee
of Ways and Means, (Mr. McDdffie,) now, and then, a
distinguished member of this House, from South Carolina.
" While there is a national bank bound by its charter to
perform certain stipulated duties, and entitled to receive
the Government deposites as a compensation allowed by
the law creating the charter, and only to be forfeited by
a failure to perform these duties, there is nothing in the
connexion at all inconsistent with the independence of the
bank and the purity of the Government. The country
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Gales, Joseph, 1761-1841. Register of Debates in Congress, Comprising the Leading Debates and Incidents of the First Session of the Twenty-Third Congress, book, 1834; Washington D.C.. (https://digital.library.unt.edu/ark:/67531/metadc30766/m1/43/: accessed April 25, 2024), University of North Texas Libraries, UNT Digital Library, https://digital.library.unt.edu; crediting UNT Libraries Government Documents Department.