between sixty and eighty millions of specie in the United States. The expenditures of the Government for the year 1838-the last for which we have had the report-were forty millions. Thus it is seen that if the whole revenue be collected in specie, it will take more than half of all the specie in the nation to do it. By this means more than half of all the specie belonging to the fifteen millions of souls who compose the whole population of the country is thrown into the hands of the public-office holders, and other public creditors, composing in number perhaps not more than one quarter of a million, leaving the other fourteen millions and three quarters to get along as they best can, with less than one half of the specie of the country, and whatever rags and shinplasters they may be able to put, and keep, in circulation. By this means, every office-holder and other public creditor may, and most likely will, set up shaver; and a most glorious harvest will the specie-men have of it,-each specieman, upon a fair division, having to his share the fleecing of about fifty-nine rag-men.1 In all candor let me ask, was such a system for benefiting the few at the expense of the many ever before devised? And was the sacred name of Democracy ever before made to indorse such an enormity against the rights of the people?

I have already said that the subtreasury will reduce the quantity of money in circulation. This position is strengthened by the recollection that the revenue is to be collected in specie, so that the mere amount of revenue is not all that is withdrawn, but the amount of paper circulation that the forty millions would serve as

1 On January 4, 1839, the Senate of the United States passed the following resolution, to wit:

"Resolved, That the Secretary of the Treasury be directed to communicate to the Senate any information he may recently have received in respect to the mode of collecting, keeping, and disbursing public moneys in foreign countries."

Under this resolution, the Secretary communicated to the Senate a letter, the following extract from which clearly shows that the collection of the revenue in specie will establish a sound currency for the office-holders, and a depreciated one for the people; and that the office-holders and other public creditors will turn shavers upon all the rest of the community. Here is the extract from the letter, being all of it that relates to the question:

"HAGUE, October 12, 1838.

"The financial system of Hamburg is, as far as is known, very simple, as may be supposed from so small a territory. The whole amount of Hamburg coined money is about four and a half millions of marks current, or one million two hundred and eighty-two thousand five hundred dollars; and, except under very extraordinary circumstances, not more than one half that amount is in circulation, and all duties, taxes, and excise must be paid in Hamburg currency. The consequence is that it invaria

bly commands a premium of one to three per centum. Every year one senator and ten citizens are appointed to transact the whole of the financial concern, both as to receipt and disbursement of the funds, which is always in cash, and is every day deposited in the bank, to the credit of the chancery; and, on being paid out, the citizen to whose department the payment belongs must appear personally with the check or order, stating the amount and to whom to be paid. The person receiving very seldom keeps the money, preferring to dispose of it to a money-changer at a premium, and taking other coin at a discount, of which there is a great variety and a large amount constantly in circulation, and on which in his daily payment he loses nothing; and those who have payments to make to the government apply to the money-changers again for Hamburg currency, which keeps it in constant motion, and I believe it frequently occurs that the bags, which are sealed and labeled with the amount, are returned again to the bank without being opened.

"With great respect, your obedient servant, JOHN CUTHBERT. "To the Hon. LEVI WOODBURY,

"Secretary of the Treasury, Washington, D. C.”~

This letter is found in Senate document,

p. 113 of the session of 1838-9.

a basis to is withdrawn, which would be in a sound state at least one hundred millions. When one hundred millions, or more, of the circulation we now have shall be withdrawn, who can contemplate without terror the distress, ruin, bankruptcy, and beggary that must follow. The man who has purchased any article-say a horse-on credit, at one hundred dollars, when there are two hundred millions circulating in the country, if the quantity be reduced to one hundred millions by the arrival of pay-day, will find the horse but sufficient to pay half the debt; and the other half must either be paid out of his other means, and thereby become a clear loss to him, or go unpaid, and thereby become a clear loss to his creditor. What I have here said of a single case of the purchase of a horse will hold good in every case of a debt existing at the time a reduction in the quantity of money occurs, by whomsoever, and for whatsoever, it may have been contracted. It may be said that what the debtor loses the creditor gains by this operation; but on examination this will be found true only to a very limited extent. It is more generally true that all lose by it-the creditor by losing more of his debts than he gains by the increased value of those he collects; the debtor by either parting with more of his property to pay his debts than he received in contracting them, or by entirely breaking up his business, and thereby being thrown upon the world in idleness.

The general distress thus created will, to be sure, be temporary, because whatever change may occur in the quantity of money in any community, time will adjust the derangement produced; but while that adjustment is progressing, all suffer more or less, and very many lose everything that renders life desirable. Why, then, shall we suffer a severe difficulty, even though it be but temporary, unless we receive some equivalent for it?

What I have been saying as to the effect produced by a reduction of the quantity of money relates to the whole country. I now propose to show that it would produce a peculiar and permanent hardship upon the citizens of those States and Territories in which the public lands lie. The land-offices in those States and Territories, as all know, form the great gulf by which all, or nearly all, the money in them is swallowed up. When the quantity of money shall be reduced, and consequently everything under individual control brought down in proportion, the price of those lands, being fixed by law, will remain as now. Of necessity it will follow that the produce or labor that now raises money sufficient to purchase eighty acres will then raise but sufficient to purchase forty, or perhaps not that much; and this difficulty and hardship will last as long, in some degree, as any portion of these lands shall remain undisposed of. Knowing, as I well do, the difficulty that poor people now encounter in procuring homes, I hesitate not to say that when the price of the public lands shall be doubled or trebled, or, which is the same thing, produce and labor cut down to one half or one third of their present prices, it will be little less than impossible for them to procure those homes at all. In answer to what I have said as to the effect the subtreasury would have upon the currency, it is often urged that the money col

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lected for revenue purposes will not lie idle in the vaults of the treasury; and, farther, that a national bank produces greater derangement in the currency, by a system of contractions and expansions, than the subtreasury would produce in any way. In reply, I need only show that experience proves the contrary of both these propositions. It is an undisputed fact that the late Bank of the United States paid the government $75,000 annually for the privilege of using the public money between the times of its collection and disbursement. Can any man suppose that the bank would have paid this sum annually for twenty years, and then offered to renew its obligations to do so, if in reality there was no time intervening between the collection and disbursement of the revenue, and consequently no privilege of using the money extended to it? Again, as to the contractions and expansions of a national bank, I need only point to the period intervening between the time that the late bank got into successful operation and that at which the government commenced war upon it, to show that during that period no such contractions or expansions took place. If, before or after that period, derangement occurred in the currency, it proves nothing. The bank could not be expected to regulate the currency, either before it got into successful operation, or after it was crippled and thrown into death convulsions, by the removal of the deposits from it, and other hostile measures of the government against it. We do not pretend that a national bank can establish and maintain a sound and uniform state of currency in the country, in spite of the National Government; but we do say that it has established and maintained such a currency, and can do so again, by the aid of that government; and we further say that no duty is more imperative on that government than the duty it owes the people of furnishing them a sound and uniform currency.

I now leave the proposition as to the effect of the subtreasury upon the currency of the country, and pass to that relative to the additional expense which must be incurred by it over that incurred by a national bank as a fiscal agent of the government. By the late national bank we had the public revenue received, safely kept, transferred, and disbursed, not only without expense, but we actually received of the bank $75,000 annually for its privileges while rendering us those services. By the subtreasury, according to the estimate of the Secretary of the Treasury, who is the warm advocate of the system (and which estimate is the lowest made by any one), the same services are to cost $60,000. Mr. Rives, who, to say the least, is equally talented and honest, estimates that these services, under the subtreasury system, cannot cost less than $600,000. For the sake of liberality, let us suppose that the estimates of the secretary and Mr. Rives are the two extremes, and that their mean is about the true estimate, and we shall then find that when to that sum is added the $75,000 which the bank paid us, the difference between the two systems, in favor of the bank and against the subtreasury, is $405,000 a year. This sum, though small when compared to the many millions annually expended by the General Government, is, when viewed by itself, very large; and much too large, when viewed

in any light, to be thrown away once a year for nothing. It is sufficient to pay the pensions of more than four thousand Revolutionary soldiers, or to purchase a forty-acre tract of government land for each one of more than eight thousand poor families.

To the argument against the subtreasury, on the score of additional expense, its friends, so far as I know, attempt no answer. They choose, so far as I can learn, to treat the throwing away of $405,000 once a year as a matter entirely too small to merit their Democratic notice.

I now come to the proposition that it would be less secure than a national bank as a depository of the public money. The experience of the past, I think, proves the truth of this. And here, inasmuch as I rely chiefly upon experience to establish it, let me ask how is it that we know anything-that any event will occur, that any combination of circumstances will produce a certain result-except by the analogies of past experience? What has once happened will invariably happen again when the same circumstances which combined to produce it shall again combine in the same way. We all feel that we know that a blast of wind would extinguish the flame of the candle that stands by me. How do we know it? We have never seen this flame thus extinguished. We know it because we have seen through all our lives that a blast of wind extinguishes the flame of a candle whenever it is thrown fully upon it. Again, we all feel to know that we have to die. How? We have never died yet. We know it because we know, or at least think we know, that of all the beings, just like ourselves, who have been coming into the world for six thousand years, not one is now living who was here two hundred years ago. I repeat, then, that we know nothing of what will happen in future, but by the analogy of experience, and that the fair analogy of past experience fully proves that the subtreasury would be a less safe depository of the public money than a national bank. Examine it. By the subtreasury scheme the public money is to be kept, between the times of its collection and disbursement, by treasurers of the mint, custom-house officers, land officers, and some new officers to be appointed in the same way that those first enumerated are. Has a year passed, since the organization of the government, that numerous defalcations have not occurred among this class of officers? Look at Swartwout with his $1,200,000, Price with his $75,000, Harris with his $109,000, Hawkins with his $100,000, Linn with his $55,000, together with some twenty-five hundred lesser lights. Place the public money again in these same hands, and will it not again go the same way? Most assuredly it will. But turn to the history of the national banks in this country, and we shall there see that those banks performed the fiscal operations of the government through a period of forty years, received, safely kept, transferred, disbursed an aggregate of nearly five hundred millions of dollars; and that, in all this time, and with all that money, not one dollar, nor one cent, did the government lose by them. Place the public money again in a similar depository, and will it not again be safe. But, conclusive as the experience of fifty years is that individuals are unsafe depositories of the public money, and of forty

years that national banks are safe depositories, we are not left to rely solely upon that experience for the truth of those propositions. If experience were silent upon the subject, conclusive reasons could be shown for the truth of them.

It is often urged that to say the public money will be more secure in a national bank than in the hands of individuals, as proposed in the subtreasury, is to say that bank directors and bank officers are more honest than sworn officers of the government. Not so. We insist on no such thing. We say that public officers, selected with reference to their capacity and honesty (which, by the way, we deny is the practice in these days), stand an equal chance, precisely, of being capable and honest with bank officers selected by the same rule. We further say that with however much care selections may be made, there will be some unfaithful and dishonest in both classes. The experience of the whole world, in all bygone times, proves this true. The Saviour of the world chose twelve disciples, and even one of that small number, selected by superhuman wisdom, turned out a traitor and a devil. And it may not be improper here to add that Judas carried the bag-was the subtreasurer of the Saviour and his disciples. We, then, do not say - nor need we say to maintain our proposition -that bank officers are more honest than government officers selected by the same rule. What we do say is that the interest of the subtreasurer is against his duty, while the interest of the bank is on the side of its duty. Take instances: A subtreasurer has in his hands one hundred thousand dollars of public money; his duty says, "You ought to pay this money over," but his interest says, "You ought to run away with this sum, and be a nabob the balance of your life." And who that knows anything of human nature doubts that in many instances interest will prevail over duty, and that the subtreasurer will prefer opulent knavery in a foreign land to honest poverty at home? But how different is it with a bank. Besides the government money deposited with it, it is doing business upon a large capital of its own. If it proves faithful to the government, it continues its business; if unfaithful, it forfeits its charter, breaks up its business, and thereby loses more than all it can make by seizing upon the government funds in its possession. Its interest, therefore, is on the side of its duty-is to be faithful to the government, and consequently even the dishonest amongst its managers have no temptation to be faithless to it. Even if robberies happen in the bank, the losses are borne by the bank, and the government loses nothing. It is for this reason, then, that we say a bank is the more secure. It is because of that admirable feature in the bank system which places the interest and the duty of the depository both on one side; whereas that feature can never enter into the subtreasury system. By the latter the interest of the individuals keeping the public money will wage an eternal war with their duty, and in very many instances must be victorious. In answer to the argument drawn from the fact that individual depositories of public money have always proved unsafe, it is urged that, even if we had a national bank, the money has to pass through the same individual hands that it will under the subtreasury. This is