686 



THE FAKJVIERS' REGISTER. 



partner to the banks. Our proposed plan is to 

 dissolve the partnership between bank and state, 

 and withdraw (he state investment, or otherwise 

 gradually to sell off all the bank stocks held by 

 the commonwealth. By these means all present 

 necessities of the treasury would be provided lor, 

 all debts and obligations discharged, and the siili 

 greater benefit produced, of a release from the 

 controlling influence of a Iraudulent banking sys- 

 tem, and banking and borrowmg interest, which 

 release alone would be well woriU iha absolute 

 sacrifice oC all the state's share in the partnership. 

 Therefore we would earnestly urge on all of our 

 legislators who are opposed to the continuation ol 

 fraudulent banking, and of bank government, to 

 resort lo increased taxation rather than to loans; 

 but to permit neither, iC they can have power to 

 compel the sale of stocks. 



That the banks and all their partizans should 

 be in the highest degree hostile lo any such plan 

 is oC course lo be expected. And their opposition 

 would be properly applied. For, when the pnii- 

 nership between the state and the banks is once 

 dissolved, there would be no longer any hope for, 

 or possibility of; the legislative permission to fraud- 

 ulent and pillaging banking operations. There- 

 fore, all true and thorough bankites would oppose 

 the first steps towards a sale of the state's stock, 

 as vehemently as they would a retu"'n to reduced, 

 responsible, honest, and there fore profitless bank- 

 ing operations. Wi'h such persons we do not 

 pretend to argue, as a chantre of their course 

 would be utterly hopeless. We address those 

 who are truly opposed to the evils of the banking 

 system, and who are indeed disposed to correct, 

 or control them. 



We now write, of course, in advance of the 

 exposition ol" the financial condition of the com- 

 monwealth, which will soon be presented to the 

 legislature. Nor have we lately consulted any 

 past reports, nor do we profess any particular 

 knowledge of the various sources of income, and 

 of the amount of obligations of the treasury. But 

 whether the balance ol capital (in stocks) oveV the 

 whole indebtedness lo the banks be great or 

 small, the principle is the same, and ihe object 

 proposed is alike desirable. If the balance would 

 be heavy, it is important to secure it, and to use 

 it lo pay the state's debts and current expenses. 

 If, on the contrary, the balance be small, it is so 

 much the more necessary to get rid of so much 

 leeislative difficulty, and the expense of the entire 

 management, when the state's net interest is in- 

 considerable and of little value. And if the 

 state's net balance of value should amount to 

 nothing, (^as \t doubtless will be hereafter, if the 

 present partnership and borrowing system is con- 

 tinued,) then the state will bear all the enormous 

 cost of management, and all the evil influences 

 of the connexion with banks, for no gain or source 

 of revenue whatever. Therefore, no matter 

 what may be the present slate of the balance 

 sheet, the sooner the state stocks and interest 

 are disposed ofj the better for the state and the 

 people. 



If this plan were advocated with any prospect 

 of successiul execution, it would be opposed by 

 the assertion that to put the state stock into 

 market would reduce the price grtaily below its 

 real value. If gradually done, we do not believe 

 that such would be the case ; though some reduc- 



tion might take place, and that without bringing 

 the price below the renl value. But the object 

 might be best effected by simply dissolving the 

 banking partnership between the state and the 

 other stockholders, and withdrawing the state's 

 share of the capital, leave the other stockholders 

 to be the sole owners and the sole managers of 

 ihe banks. The right to do this is unquestiona- 

 ble, and upon two different grounds — either by 

 the preponderating vote of the state in the gene- 

 ral meeting of stockholders, or by the right re- 

 served by (he legislature, at each restoration of 

 the violated and forfeited bank charters, to amend 

 or modify them therealler at pleasure. 



Another important incidental effect might be 

 produced by this course, serving to remove the 

 greatest alleged obstacles lo bank resumption. 

 The well v-ecured debts due by individuals to the 

 banks, which cannot be conveniently discharged 

 soon, might be transferred to the state, as part 

 of its share in the division of the stock in trade ; 

 and thus the pressure upon solvent debtors, 

 which must necessarily accompany bank resump- 

 tion, no matter how long deferred, would be 

 greatly lightened, and perhaps made as easy as 

 any indulgence to suspended banks could possibly 

 effect. We have formerly presented reasons for 

 believing that the actual distress to be thus pro- 

 duced, even if without any mitigation and rei-ief, 

 would be small, compared to the exaggerated pre- 

 dictions of the bankites, used to operate on the 

 ignorance and the fears of the debtor class in 

 general. 



THE TRUE AND THE FALSE REASONS FOR 

 BANK SUSPENSION. 



(To the Editor of the Bank Reformer.) 



Dear sir : — In return for the numbers of your 

 Bank Reformer, with which I have been favored, 

 permit me to contribute my mite towards the ac- 

 complishment of the very praise-worthy object 

 that you have in view : a compulsory return of 

 the banks of Virginia to specie payments. I say 

 a compulsory return, because it is but too evident, 

 thai nothing short of legislative coercion, or rather 

 an inter7nission of legislative wrong, will drive 

 these balefiil institutions into a compliance with 

 their engagements. For no man, or body of 

 men, will ever want a pretext for consulting their 

 inclinations or their interests. And, according to 

 Franklin, it is an excellent thing to be reasonable 

 creatures, that we may find out reasons to justify 

 what we are determined lo do — or not to do.~ 



Now of all the shallow pretences put forth 

 when thus pre-rcsolved, none can be more shal- 

 low than the allegation that the Virginia banks, 

 beinf debtois, cannot resume, because the north- 

 ern banks, their creditors, have suspended. Were 

 the case reversed, something might be said, but 

 it is, I believe, a new thing under the sun to con- 

 tend, that A cannot pay B because B does not 

 choose lo pay C, there being no connexion be- 

 tween A and C. 



But the reason now devised is novel rather in 

 form Ihan in substance. For I well recollect, 

 that when the question arose whether the banks 

 should resume after the suspension consequent 

 upon the late war, the consideration then urged 



