﻿ESAREY: STATE BANKING IN INDIANA 



269 



Mr. Rariden of Wayne, a champion of the Bank, addressed the 

 convention in the first of a series of fifty set speeches on the bank 

 question, by as many of the leading delegates. It was not, argued 

 Mr. Rariden, a question of philosophy, but a question of what 

 kind of bank, and what kind of currency, should be had right here 

 in Indiana. If all banks should be forbidden in Indiana, the banks 

 of Ohio, Kentucky, and other neighboring states, would supply all 

 the currency. There could be no hope of a specie circulation. 

 The circulation in use was then about $5,000,000, which was 

 worth seven per cent; and if they abolished banks they would cause 

 an annual loss to the citizens of the $350,000 interest on this amount. 

 The community he represented was pledged to a paper currency. 

 The State Bank had furnished this and had answered all other 

 purposes for which it was created. It had made $870,000 for the 

 school fund; it had paid a tax of $200,000 to the state; it had 

 safely and without cost carried the merchants' money to the East 

 and brought the stock buyers' money to the West. When it had 

 charged only common interest for this exchange, it had been assailed 

 as usurious. But whatever could be done, would be done by its 

 enemies, to secure a system of free banks. It was the hope of 

 certain men to have these founded on railroad stock. This com- 

 bination, then, that accorchng to Governor Wi'ight's message paid 

 little tax, would control the state. Gentlemen had said they would 

 not embark in free banking unless the hands of the state were tied 

 so that it might not interfere, but he did not want to try the experi- 

 ment without leaving the state at liberty to enter the field and drive 

 the free banks out if they should prove bad, as he thought they would. 



David M. Dobson, representing Owen and Greene counties, 

 followed Mr. Rariden. He asked where all this noise about free 

 banks had come from, and answered by saying that some twenty 

 odd years before all the states had engaged in extensive works of 

 internal improvement an el there had been issued upwards of $200,- 

 000,000 in state bonds. Many states had failed. The bondholders 

 had tried to get Congress to assume these debts. Failing there, they 

 appeared here now, and asked to do our banking for us. Indiana, 

 he said, had $7,000,000 in bonds outstanding, and drawing five per 

 cent interest. Members had told us that if we should allow banking 

 oh these bonds, they would come home, and the interest on them 

 would be paiel in our midst. But, queried Mr. Dobson, where 

 would our people get the money to buy $7,000,000 worth of bonds? 

 There was only $1,500,000 specie in the state. It would turn out 

 that these foreigners would deposit these bonds as bank capital 



