﻿ESARF.Y: STATE BANKING IN INDIANA 



249 



In general, the committee agreed with Mr. Ewing. They favored 

 a national bank with state branches, state controlled; and recom- 

 mended that Indiana organize a branch, and by issuing state five 

 per cent bonds buy 1800,000 of this national currency. Out of 

 the dividends, they estimated, the five per cent on the loan could 

 be paid, and the surplus would go far toward the establishment of 

 free primary schools throughout the state. 



At the same time there was a bill before the Senate to charter 

 a co-partnership bank with nine branches.'' If any branch failed 

 to pay six per cent it was to be closed. The state was to take one- 

 half of the stock, which was to be non-taxable, and the charter 

 was to run twenty-seven years. A bill similar to Farrington's 

 passed the House of Representatives January 18, by a vote of 42 

 to 28.5 There were now three bank bills before the Senate. 



The Committee Bill was not discussed. James Raridan of 

 Wayne county, one of the ablest members, spoke on the Farrington 

 Bill. 6 His objections to it were that the interest on 1800,000 would 

 take 140,000 out of the state annually. ^'However you may figure," 

 he concluded, "the people must finally pay every cent of this enor- 

 mous tribute." It would become the basis of a political machine 

 that would not only control elections and political preferments, 

 but by adroit management of its loans would monopolize business. 

 Its directors and stockholders would rule the state. Its patrons 

 and debtors, a devoted arm}-, would rule at the polls. It could 

 make or break a merchant at its pleasure. Furthermore, the 

 speaker did not consider the division of capital just. It should be 

 divided according to the commercial needs of the districts; but 

 as the matter stood the First, or Whitewater, district with an annual 

 commerce of over $300,000 and the Sixth with $100,000 would 

 get the same capital. The bill provided, further, that the names 

 of all borrowers should be concealed. This provision, he said, 

 would prevent one person from knowing another's financial standing 

 and would ruin credit and confidence. Worst of all, the bill would 

 divide the people into two classes. The farmer and the laborer 

 had no need of banks, and would derive no advantage from them. 

 The gain would all go to the moneyed men, to the merchants. 



While this debate was going on the committee reported the 

 House Bill, and it was lost in the Senate by a tie vote, 13 to 13. 

 The Senate then resumed the discussion of the Farrington Bill. 



* Indiana Journal, January 5, 1833. 



'■Indiana Journal, January 19, 1833. Also, Journal of the House of Representatives, 1832, p. 435. 

 "Indiana Journal, January 26, 1833; his speech is given entire. It is analyzed here, not because 

 of the soundness of its doctrines, but because it is a tj^pical argument on the question. 



