﻿ESAKEY: STATE BANKING IN INDIANA 



241 



in overruling a motion in arrest of judgment, pronounced it a clear 

 case of violation of charter. 7- 



On appeal to the state supreme court/^ Judges Scott and Holman 

 affirmed the decision in so far as it related to the charter, but re- 

 versed it in so far as it related to the property of the Bank, so that 

 the property reverted to the original donor. The Bank creditors 

 were left entirely without remedy, and the debtors to the Bank 

 were discharged.^" 



Echoes of the failure of the Bank are met with frequently in the 

 political literature of the time. When State Treasurer Lane was 

 succeeded by Samuel Merrill the former insisted on turning over 

 the state funds in the form of these old Bank notes. A ynandamus 

 suit was necessary to decide the question. ^5 When Governor Jen- 

 nings went to Congress, he called for the papers concerning the 

 Bank, and attempted to make out a case of collusion between the 

 Bank and the Secretary of the Treasury, The House of Rep- 

 resentatives called for the papers, but the investigation resulted 

 in nothing but additional disgrace and humiliation to the Bank 

 officers and directors. The Madison Bank was cited to show 

 what honest men could have done." Governor Hendricks, who 

 succeeded Governor Jennings, took advantage of his annual 

 message to read the state a lecture on "wildcat" banking. Vin- 

 cennes never regained in state politics the prestige that was 

 lost in this unfortunate affair. 



This study of Indiana's first Bank shows, as could just as well 

 be shown by a study of the first banks of Ohio, Kentucky, or Illinois, 

 that the economic and political, as well as the moral laws govern- 

 ing banking were not well understood. There were large numbers 

 of men who thought "wildcat" banking morally justifiable. The 

 economic demands for a bank were either unknown or unheeded, 

 and banks, like railroads and canals, were established where wealth 

 and business interests could not sustain them. Moreover, Jeffer- 

 sonian and Jacksonian democracy taught that government should 

 interfere as little as possible in the business affairs of men. Bankers, 

 like merchants, manufacturers, or farmers should be left to carry 



"2 Western Sun, July 13, 1822. See Circuit Court Records at Vincennes under the same date. 



Blac]:ford's Reports. 

 '4 Western Sun, November 22, 1823. 

 1 '5 Merrill vs. Lane, Blackford's Reports. 

 '0 Am. Sta. Pa., Fin., V, 104. 

 For a similar experience in Michigan, see Judge Thomas M. Cooley's "State Bank Issues in 

 Michigan," I, {Publications Michigan Political Science Association). A good contemporary view is 

 given by William M. Gouge in his Short History of Paper \Tonejj and Bankiwj in the U. S. (Philadelphia, 

 1833), Part II, ch. xiv. 



