CONGRESS, UNITED STATES. 



169 



do not regard them as a forced loan at all; 

 and the next thing is that it enlarges the bank 

 currency of the country, to enable more of 

 the national banks to be set up. That strikes 

 me to be about the whole of this bill; and 

 I cannot think that it is very likely to result 

 in a return to and the maintenance of specie 

 payments very soon, because whenever you 

 authorize the greenbacks to be reissued from 

 time to time, I do not think, if we have a 

 pressure, but that Congress will come in and 

 compel their reissue if necessary. And here 

 I may say, in regard to this greenback cur- 

 rency, that the objection to it is that a green- 

 back currency is said to be synonymous with 

 an inconvertible currency, and that if we are 

 to maintain a greenback currency it means 

 that we are to have no resumption of specie 

 payments at all. Another objection is that 

 a Government currency is liable to inflation, 

 because it is subject to the popular demand 

 upon the Legislature ; and when that demand 

 U very strong the Legislature always gives 

 way to it and increases the amount of the 

 currency. 



" But, sir, so far as inflation is concerned yon 

 may have just as much inflation by means of 

 the national banks. The public cry for more 

 currency operating upon Congress will make 

 us authorize these banks to issue more cur- 

 rency just as soon as it would make us provide 

 for the issuing of more greenbacks. When 

 you have the national banks all in the power 

 of Congress, and Congress has taken posses- 

 sion of the whole subject of the currency of the 

 country, the Congress in one way or the other, 

 whether yon have greenbacks or whether you 

 have national bank currency alone, will in 

 obedience to that popular demand inflate the 

 currency, or retire it or compel its retirement, 

 just as the clamor of the day may require; 

 and it may do so just as well in the one case 

 as it may in the other. 



"As at present advised, Mr. President, I can- 

 not vote for this bill. I would like to see a 

 specie - paying currency in the country as 

 much as any man. I believe in a specie-paying 

 currency, but I do not believe that it is of 

 much use to call this a specie-paying currency 

 when a national bank can redeem either in 

 gold or in greenbacks, and we thus make green- 

 backs better than the currency of the national 

 banks and provide for maintaining a greenback 

 currency to some extent at least." 



Mr. Buckingham, of Connecticut, said : " I 

 am very anxious to have that accomplished 

 which the Committee on Finance have in view 

 by the introduction of this bill, and I think 

 their bill, with certain amendments which may 

 be adopted, will aid in that object. That is to 

 say, we can secure an elastic currency, which 

 we have never yet secured, and in securing it 

 we may make an amendment which will appre- 

 ciate the national obligations, and that will be 

 in the direction of specie payments, although, 

 do what you will, specie payments are yet in 



the distance. But I desire to have this bill so 

 amended that it shall be an improvement, and 

 that we shall be improving in the right direc- 

 tion ; and therefore I approve of the suggestions 

 and the amendment proposed by the honorable 

 Senator from Ohio (Mr. Sherman) in regard to 

 striking out the word ' which.' I think it means 

 a good deal as it stands. It leaves any banking 

 association to determine, as they may will, to 

 resume specie payment and pay coin accord- 

 ing to the requirements of the law, and if they 

 do they are relieved from keeping a reserve. 

 They may say that and do it to-day and relieve 

 themselves of their reserve to-morrow, and the 

 next day be wholly unable to comply with the 

 requirements of the law. Therefore I think 

 the word ' which ' should be removed, and 

 they should be compelled, as under the law 

 now, to meet their obligations. 



"But the honorable Senator farthest from 

 me (Mr. Thurman) has placed this provision in 

 its true light. It is simply a question whether 

 the Congress of the United States is ready to 

 relieve the banks from holding a reserve. 

 That is all there is in the section if the amend- 

 ment be carried. I know there is a great dif- 

 ference in the judgment of men in regard to 

 the propriety of such a provision. I know you 

 will find eminent business men who will assure 

 you that this is a matter of no importance, be- 

 cause men who understand business and who 

 mean to be true and meet their obligations will, 

 as a matter of necessity, hold themselves in a 

 position to meet all their obligations. But 

 my observation is that there are many men 

 who when associated together as directors of 

 banks have not that wisdom or ability, if you 

 please, to manage their banks in such a man- 

 ner that they will hold the reserve necessary 

 to enable them to meet their obligations. 



" Now, we want a law to meet those who 

 have not this sound judgment, those who 

 would put aside their obligations, if you 

 please; and it appears to me it is a question 

 of very great moment whether the Congress 

 of the United States ought to relieve the banks 

 as a whole from holding a reserve. What is 

 the value of the reserve? To-day it is to en- 

 able banks to meet their obligations, and it re- 

 quires them to cease discounting when their 

 reserve is below a certain line ; but, if you re- 

 move this reserve and then come to the very 

 position which is suggested by my friend from 

 Ohio, the reserve is gone, and yon are just as 

 much unable to meet a cornering operation as 

 though you had the twejity-five per cent, re- 

 serve; you have only gone a little further. 

 But, when yon have reached that distant point 

 further from you, where the bank's reserve is 

 gone, they have no more ability to meet a press- 

 ure than they had with twenty-five per cent, 

 reserve, and this would let loose the entire re- 

 serve now of fifteen or twenty-five per cent., 

 as the case may be, and would for the moment 

 create a snp_erabnndance of currency." 



Mr. Morrill, of Vermont: "Mr. President, 



