CONGRESS, U. S. 



291 



bills at the Treasury. If the banks do not re- 

 deem them in. currency when asked for their 

 redemption, they may be protested and pre- 

 sented at the Treasury, and the Treasury is to 

 pay them, and to pay them in full, whether 

 the stocks left upon deposit are able to meet 

 them or not. Besides this investment, the 

 property put into these associations is itself to 

 be clear of taxation. 



"Now, Mr. President, it is to be further 

 understood, and is an integral part of the very 

 system, without which it is good for nothing, 

 that the circulation of the existing banks of 

 the country is to be withdrawn. Measures are 

 to be taken with those banks that shall induce 

 or compel them to take home their circulation 

 and put it out no more, so that this shall be a 

 national currency. Unless this latter part of 

 the scheme is secured, its great professed ob- 

 ject of making a uniform national currency 

 throughout the United States is not and can- 

 not be effected. It therefore implies all this, 

 and we must understand that if we enter upon 

 this proposition and entertain this plan, we 

 are to take measures in order to perfect it to 

 do the other thing ; that is, to destroy, put out 

 of existence, the circulation of the present 

 State banks. 



" The Supreme Court, in the case of McCul- 

 lough vs. Maryland, decided that the United 

 States had the right to make a United States 

 Bank, with branches in different States, and 

 they said the States could not tax that United 

 States Bank. Why ? Because the exercise of 

 that power in the extreme would destroy it, 

 and therefore you would make it out that the 

 Congress had a power to establish a bank ; 

 but after all, it was subject to the power of the 

 States to put it down. In the case of Ken- 

 tucky, the Supreme Court decided that the 

 long-continued usage in this country in States 

 to make banks was constitutional, and that a 

 State had a right to make a bank of issue. 

 There were other questions in that case which 

 it is not necessary now to bring in here. It 

 was decided that a State had a right, not to 

 make a bank to issue the State paper, but a 

 bank to issue paper currency. 



" Now, sir, if a State has that right, it has 

 that right certainly independent of the consent 

 of Congress. Does it hold it at the will of Con- 

 gress ? Certainly not. The United States, in 

 making a United States Bank, held it inde- 

 pendent of State action, and it was so decided. 

 If the State has this right, and has it independ- 

 ent of the consent of Congress, it cannot have 

 that right if the United States can tax it out 

 of existence. Hence, I say the United States 

 has no more power to tax a State institution, 

 out of existence than a State has to tax a 

 United States institution out of existence. I 

 should like to see that answered. I have some- 

 times proposed that question, but I have never 

 received any answer to it. In most of the 

 States, the State of New York, for instance, 

 almost all their banks are founded upon their 



own State stocks. It is a part of their finan- 

 cial system to make their stocks valuable, and 

 to enable them to make internal improvements. 

 All these State banks are more or less connect- 

 ed with and ramified in with the business of 

 their several States. Can they be taxed out 

 of existence by the United States? Why, sir, 

 you might just as well tell me that the United 

 States, under the power of taxation, could go 

 on and extinguish all the schools in New Eng- 

 land by taxing its schools, its colleges, and its 

 academies, and their books and their buildings 

 and the salaries of the professors, and in that 

 way destroy them under the very general prin- 

 ciple of the power of universal taxation. I 

 shall not dwell any longer upon that point. I 

 have stated my view upon it. 



"But, Mr. President, there is another prin- 

 ciple involved in this measure, and I am look- 

 ing at it now in its great national aspects, as a 

 national principle, without regard to the time. 

 I say it is to establish corporations in all the 

 States and Territories, entirely independent of 

 any power of visitation by those States or Ter- 

 ritories. This, to say the least of it, is an ex- 

 tremely questionable power. What may be 

 the number of these institutions ? As the cap- 

 ital is to be $300,000,000, that -will make three 

 thousand banks of $100,000 each ; and the bill 

 provides that they may be made $50,000 banks, 

 which will make six thousand $50,000 banks. 

 I believe we have now, in what are called the 

 loyal States, between thirteen and fourteen 

 hundred banks altogether ; and this bill pro- 

 poses to make at least three thousand, or per- 

 haps six thousand of these bank corporations, 

 established all over the States. 



" That is not all. It is proposed that there 

 shall be no other banks but these ; the whole 

 banking capital is to be put into these banks, 

 and the whole of that property is removed 

 from all State taxation. I ask gentlemen to 

 reflect on what will be the effect in their dif- 

 ferent States of closing up the present banks, 

 and taking the capital belonging to the stock- 

 holders, putting it into tho banks under this 

 bill, and removing the whole of it from all the 

 forms of State taxation State, county, city, 

 and town. Many of our States derive their 

 school fund from what they obtain from these 

 State banks. I believe it is so in New Hamp- 

 shire. They have their school fund in that way. 



"The next point to which I desire to call 

 attention is the propriety of our undertaking 

 as a nation to say that we will be responsible 

 for the ultimate redemption of these bills by 

 the securities that are deposited. I am aware 

 that the honorable senator who is the parent 

 of the bill here thinks he has got in it some- 

 thing very valuable, in the provision about the 

 liability of individual stockholders, and requir- 

 ing twenty-five per cent, of the amount of their 

 circulation to be kept on hand. All these 

 things, to my mind, are hardly worth the paper 

 on which they are written ; they are good for 

 nothing at all. How can you follow the re- 



