284 



THE FARMERS' REGISTER. 



counting to the amount of their capita! and depo- 

 Bites, would not be impaired— and to that extent 

 is as far as a bank can go, with a depreciated or 

 discredited paper circulation, unless in a state ol 

 eus'pension, authorized and sustained by law. Bu' 

 this, the only proper and honest course, has never 

 been, and never will be resorted to by suspended 

 banks, except to such extent only as is compelled 

 by tear oC the withdrawal of all indulgence of 

 law, and support by public opinion, and ol the re- 

 Bults of the forfeiture of all remains of public con- 

 fidence in the responsibility, honesty and ultimate 

 solvency of the banks. In addition to the profiis 

 of the banks being greatly lessened by their pur- 

 suing this proper and honest course after and un- 

 der protection of suspension, the debtors of the 

 banks, and the merchants and traders who desire 

 to become and to remain debtors, would exclaim 

 as loudly against a suspension of lending, and 

 even the most gradual curtailing of old debts, as 

 they had previously done against the hanks con- 

 tinuing to pay specie. These people, together 

 with the banks, govern and prompt the newspa- 

 pers, which again influence and shnpe the opi- 

 nions of the great body of the deluded and pil- 

 laged community — who have no interest in sus- 

 taining, and every reason for opposing, this fraud- 

 uleni banking system. It (bllovvs, therelbre, lliat 

 the baiit<s are always justified in taking the other 

 course, that is, of continuing to cheat the commu- 

 nity, by oniitming to lend irredeemable paper, 

 because it is supposed that this course is absolutely 

 nqiiired by the interests of the country at Inrire. 

 But in Virginia there is yet a more operative 

 reason, than all the influences just relerred to, 

 why the government should always sustain and 

 aid the btmks in all their fraudulent suspensions, 

 and other acts of violation of right and honesty, 

 instead of protecting the community airttinsi 

 their rapacity. The cnmmonweallh of Viririnia 

 is the chief partner — interested to nearly half the 

 amount of the stock in trade — of all the important 

 banks in the state. The income of the state trea- 

 sury is derived in great measure Irom the profits 

 of banking ; and if these profiis were at once 

 Buspended, the state would be deficient of half its 

 revenue, and heavy additional direct taxes would 

 have to be forthwith imposed on the people. Ol 

 course, the steward of the great sleeping partner, 

 the government, always yields to the representa- 

 tions and advice of the acting and more capable 

 and cunning partners in trade; and therefore the 

 laws regulating and indulging suspended banks 

 are in just such (brm, and for just such purpose, as 

 the presidentti and other master spirits of the hanks 

 choose to have enacted. The course aimed to be 

 thus sanctioned, and which has been hereiofi^re 

 and is still pursued by the banks, is to profess and 

 pretend to reduce their liabilities, and as rapidly as 

 is consistent with the public welfiire — but, in fact, 

 to make the reduction as little and as slow as possi- 

 ble, for the sake of their own gain. The slow 

 rate of reduction, and of return to honest respon- 

 Bibility, under the most imperative circumstances, 

 will be hereafter seen. 



XIJI. The modi and rate of bank " curtailing,'" 

 with the view of resuming payments. 



We do not mean to deny, that after the banks 

 have suspended payment, there is great profes- 

 $ion made, and many and strong manif'eetatioris 



also in particular cases, of great reduction of debts 

 to the banks, which, it is obvious to all persons, 

 must be made, if the banks are ever to resume 

 payment, without their bankruptcy being an im- 

 mediate consequence. But the profession is but a 

 pretence, which is as shallow as it is false. But for 

 the fear of total discredit, and the causing such 

 an out-burst of public indignaiion as would tend 

 to destroy their iniquitous rule and dishonest gains 

 altogether, the banks would, after suspension, in- 

 crease rather than diminish their operations. For 

 against such increase, by a suspended bank, there 

 is no valid check whatever. Ever since the ge- 

 neral Bus-pensioii in 1838 the banks have pretended 

 to be reduciiiiT, as rapidly as possible, their business 

 and liabilities. \et in ail these four years ihe 

 'whole amount of debts due to all the banks of 

 Viririnia has been reduced only liom ^18,000 188 

 to ^15,359,011, or a little more than one-seventh. 

 If no resirairu whaipver had been imposed by 

 law, or moral obligation, or by any other duty 

 than merely that to the stockholders of making 

 no loans to doubtful debtors, it might have been 

 supposed that ilie [iressure of the limes alone 

 would have induced ihe (Jebiors themselves to 

 conlraci iheir " accommodaitons," and their busi- 

 ness, as much as in the sniall ratio stated above. 

 For, if the preceding year of universal mad spe- 

 culation and adventure, produced and fostered hy 

 excessive bank issues, had required but ]8 mil- 

 lions of bank loans, surely the reduced business 

 and spirit of aiiventure, of the since sobered com- 

 munity, might have been as fully supplied t)y half 

 that amount. 



But even o'' the small reduction made in the 

 amount of debts to the hanks, Ihe larger portion 

 has been laid where there should have been no 

 reduction whatever, (it any new debts were per- 

 mitted to be made,) that is, on t lie business dis- 

 counts, required lor real iransaciions of trade, and 

 the purchase of the great agricultural staples of 

 the country. These, the proper and legitimate 

 and safe banking operations, and always benefi- 

 cial to the community, have been greaily re- 

 strained, and discounts lor them often refused, that 

 the illegitimaie and dangerous accommodation line- 

 of loans might be the less curtailed. 



This important proof of the insincerity of the 

 promises, and hopelessness of effective results of 

 voluntary bank reform, is abundantly set forth in 

 the lollowinir statement; which is made up from the 

 official reports of the banks to the legislature of 

 Virginia, published in the journals and public 

 documents. We present lor comparison the ge- 

 neral agcrreflrate sums from Ihe reports of Decem- 

 ber 1st, 1836, and of January Is', 1841, because 

 the first was the report ot the time of greatest 

 possible expansion, (and lor the year preceding 

 that of the suspension of specie payments.) and 

 the last, made fbui; years after, was during the 

 continuance of the suspension lor nearly all the 

 time since the first report, and when continued 

 '•curtailing" of debts, and reduction of hank lia- 

 bilities, were professed to be, and should have 

 been, pushed during that whole interval of time. 



On December 1, 1836- 

 The whole outstanding debts, due to all the 

 banks of Virginia, (omitting cents,") amount- 

 ed to - - - - $18,000,188 

 Whole amount of circulation (bank 

 notes out) - - - 8,930,691 



