ELEVENTH CONGRESS.—THIRD SESSION. PROCEEDINGS AND DEBATES THE HOUSE OF REPRESENTATIVES. (continued 2)

But there is an argument stronger, even, than all those which have been produced, to be drawn from the nature of the power here proposed to be exercised. Is it possible that such a power, if it had been intended to be given by the people, should be left dependent upon the effect of general expressions; and such too, as were obviously applicable to another subject; to a particular exigency contemplated at the time? Sir, what is this power we propose now to usurp? Nothing less than a power, changing all the proportion of the weight and influence possessed by the potent sovereignties composing this Union. A stranger is to be introduced to an equal share, without their consent. Upon a principle, pretended to be deduced from the constitution—this Government, after this bill passes, may and will multiply foreign partners in power, at its own mere motion; at its irresponsible pleasure; in other words, as local interests, party passions, or ambitious views may suggest. It is a power that, from its nature, never could be delegated; never was delegated; and as it breaks down all the proportions of power guarantied by the constitution to the States, upon which their essential security depends, utterly annihilates the moral force of this political contract. Would this people, so wisely vigilant concerning their rights, have transferred to Congress a power to balance, at its will, the political weight of any one State, much more of all the States, by authorizing it to create new States at its pleasure, in foreign countries, not pretended to be within the scope of the constitution or the conception of the people, at the time of passing it?

This is not so much a question concerning the exercise of sovereignty, as it is who shall be sovereign. Whether the proprietors of the good old United States shall manage their own affairs in their own way; or whether they, and their constitution, and their political rights, shall be trampled under foot by foreigners introduced through a breach of the constitution. The proportion of the political weight of each sovereign State, constituting this Union, depends upon the number of the States which have a voice under the compact. This number the constitution permits us to multiply at pleasure, within the limits of the original United States; observing only the expressed limitations in the constitution. But when in order to increase your power of augmenting this number you pass the old limits, you are guilty of a violation of the constitution in a fundamental point; and in one, also, which is totally inconsistent with the intent of the contract, and the safety of the States which established the association. What is the practical difference to the old partners, whether they hold their liberties at the will of a master, or whether, by admitting exterior States on an equal footing with the original States, arbiters are constituted, who by availing themselves of the contrariety of interests and views which in such a confederacy necessarily will arise, hold the balance among the parties which exist and govern us, by throwing themselves into the scale most conformable to their purposes? In both cases there is an effective despotism. But the last is the more galling, as we carry the chain in the name and gait of freemen.

I have thus shown, and whether fairly, I am willing to be judged by the sound discretion of the American people, that the power, proposed to be usurped, in this bill, results neither from the general nature, nor the particular provisions, of the Federal Constitution; and that it is a palpable violation of it in a fundamental point; whence flow all the consequences I have intimated.

The present President of the United States, when a member of the Virginia Convention for adopting the constitution, expressly declares that the treaty-making power has limitations; and he states this as one, "that it cannot alienate any essential right." Now, is not here an essential right to be alienated? The right to that proportion of political power which the constitution has secured to every State, modified only by such internal increase of States as the existing limits of the Territories at the time of the adoption of the constitution permitted. The debates of that period chiefly turned upon the competency of this power to bargain away any of the old States. It was agreed, at that time, that by this power old States within the ancient limits could not be sold from us. And I maintain that, by it, new States without the ancient limits cannot be saddled upon us. It was agreed, at that time, that the treaty-making power "could not cut off a limb." And I maintain, that neither has it the competency to clap a hump upon our shoulders. The fair proportions devised by the constitution are in both cases marred, and the fate and felicity of the political being, in material particulars, related to the essence of his constitution, affected. It was never pretended, by the most enthusiastic advocates for the extent of the treaty-making power, that it exceeded that of the King of Great Britain. Yet, I ask, suppose that monarch should make a treaty, stipulating that Hanover or Hindostan should have a right of representation on the floor of Parliament, would such a treaty be binding? No, sir; not, as I believe, if a House of Commons and of Lords could be found venal enough to agree to it. But although in that country the three branches of its legislature are called omnipotent, and the people might not deem themselves justified in resistance, yet here there is no apology of this kind; the limits of our power are distinctly marked; and when the three branches of this Government usurp upon this constitution in particulars vital to the liberties of this people, the deed is at their peril.

I have done with the constitutional argument. Whether I have been able to convince any member of this House, I am ignorant—I had almost said indifferent. But this I will not say, because I am, indeed, deeply anxious to prevent the passage of this bill. Of this I am certain, however, that when the dissension of this day is passed away, when party spirit shall no longer prevent the people of the United States from looking at the principle assumed in it, independent of gross and deceptive attachments and antipathies, that the ground here defended will be acknowledged as a high constitutional bulwark, and that the principles here advanced will be appreciated.

I will add one word, touching the situation of New Orleans. The provision of the treaty of 1803, which stipulates that it shall be "admitted as soon as possible," does not therefore imply a violation of the constitution. There are ways in which this may constitutionally be effected—by an amendment of the constitution, or by reference to conventions of the people in the States. And I do suppose, that, in relation to the objects of the present bill, (with the people of New Orleans,) no great difficulty would arise. Considered as an important accommodation to the Western States, there would be no violent objection to the measure. But this would not answer all the projects to which the principle of this bill, when once admitted, leads, and is intended to be applied. The whole extent of Louisiana is to be cut up into independent States, to counterbalance and to paralyze whatever there is of influence in other quarters of the Union. Such a power, I am well aware that the people of the States would never grant you. And therefore, if you get it, the only way is by the mode adopted in this bill—by usurpation.

The objection here urged is not a new one. I refer with great delicacy to the course pursued by any member of the other branch of the Legislature; yet I have it from such authority that I have an entire belief of the fact, that our present Minister in Russia, then a member of that body, when the Louisiana treaty was under the consideration of the Senate, although he was in favor of the treaty, yet expressed great doubts on the ground of constitutionality, in relation to our control over the destinies of that people, and the manner and the principles on which they could be admitted into the Union. And it does appear that he made two several motions in that body, having for their object, as avowed, and as gathered from their nature, an alteration in the constitution, to enable us to comply with the stipulations of that convention.

I will add only a few words in relation to the moral and political consequences of usurping this power. I have said, that it would be a virtual dissolution of the Union; and gentlemen express great sensibility at the expression. But the true source of terror is not the declaration I have made, but the deed you propose. Is there a moral principle of public law better settled, or more conformable to the plainest suggestions of reason, than that the violation of a contract by one of the parties may be considered as exempting the other from its obligations? Suppose, in private life, thirteen form a partnership, and ten of them undertake to admit a new partner without the concurrence of the other three, would it not be at their option to abandon the partnership, after so palpable an infringement of their rights? How much more, in the political partnership, where the admission of new associates, without previous authority, is so pregnant with obvious dangers and evils! Again: it is settled as a principle of morality, among writers on public law, that no person can be obliged, beyond his intent at the time of the contract. Now, who believes, who dare assert, that it was the intention of the people, when they adopted this constitution, to assign, eventually, to New Orleans and Louisiana, a portion of their political power, and to invest all the people those extensive regions might hereafter contain with an authority over themselves and their descendants? When you throw the weight of Louisiana into the scale, you destroy the political equipoise contemplated at the time of forming the contract. Can any man venture to affirm that the people did intend such a comprehension as you now, by construction, give it; or can it be concealed that, beyond its fair and acknowledged intent, such a compact has no moral force? If gentlemen are so alarmed at the bare mention of the consequences, let them abandon a measure which sooner or later will produce them. How long before the seeds of discontent will ripen, no man can foretell; but it is the part of wisdom not to multiply or scatter them. Do you suppose the people of the Northern and Atlantic States will, or ought to, look on with patience and see Representatives and Senators from the Red river and Missouri pouring themselves upon this and the other floor, managing the concerns of a seaboard fifteen hundred miles at least from their residence, and having a preponderancy in councils, into which, constitutionally, they could never have been admitted? I have no hesitation upon this point. They neither will see it, nor ought to see it, with content. It is the part of a wise man to foresee danger, and to hide himself. This great usurpation, which creeps into this House under the plausible appearance of giving content to that important point, New Orleans, starts up a gigantic power to control the nation. Upon the actual condition of things, there is, there can be, no need of concealment. It is apparent to the blindest vision. By the course of nature, and conformable to the acknowledged principles of the constitution, the sceptre of power in this country is passing towards the Northwest. Sir, there is to this no objection. The right belongs to that quarter of the country; enjoy it; it is yours. Use the powers granted as you please; but take care, in your haste after effectual dominion, not to overload the scales by heaping it with these new acquisitions. Grasp not too eagerly at your purpose. In your speed after uncontrolled sway, trample not down this constitution. Already the old States sink in the estimation of members, when brought into comparison with these new countries. We have been told that "New Orleans was the most important point in the Union." A place out of the Union the most important place within it! We have been asked, "What are some of the small States when compared with the Mississippi Territory?" The gentleman from that Territory (Mr. Poindexter) spoke the other day of the Mississippi as "of a high road between" ——. Good heavens, between what, Mr. Speaker? Why, "the Eastern and Western States." So that all the Northwestern Territories, all the countries once the extreme western boundary of our Union, are hereafter to be denominated Eastern States.

[Mr. Poindexter explained. He said that he had not said that the Mississippi was to be the boundary between the Eastern and Western States. He had merely thrown out a hint, that, in erecting new States, it might be a good high-road between the States on its waters. His idea had not extended beyond the new States, on the waters of the Mississippi.]

I make no great point of this matter. The gentleman will find, in the National Intelligencer, the terms to which I refer. There will be seen, I presume, what he has said, and what he has not said. The argument is not affected by the explanation. New States are intended to be formed beyond the Mississippi. There is no limit to men's imaginations, on this subject, short of California and Columbia river. When I said that the bill would justify a revolution, and would produce it, I spoke of its principle and its practical consequences. To this principle and those consequences, I would call the attention of this House and nation. If it be about to introduce a condition of things absolutely insupportable, it becomes wise and honest men to anticipate the evil, and to warn and prepare the people against the event. I have no hesitation on the subject. The extension of this principle to the States, contemplated beyond the Mississippi, cannot, will not, and ought not to be borne. And the sooner the people contemplate the unavoidable result, the better; the more likely that convulsions may be prevented; the more hope that the evils may be palliated or removed.

Mr. Speaker: What is this liberty of which so much is said? Is it to walk about this earth, to breathe this air, and to partake the common blessings of God's providence? The beasts of the field and the birds of the air unite with us in such privileges as these. But man boasts a purer and more ethereal temperature. His mind grasps in its view the past and the future, as well as the present. We live not for ourselves alone. That which we call liberty, is that principle on which the essential security of our political condition depends. It results from the limitations of our political system, prescribed in the constitution. These limitations, so long as they are faithfully observed, maintain order, peace, and safety. When they are violated in essential particulars, all the concurrent spheres of authority rush against each other, and disorder, derangement, and convulsion are, sooner or later, the necessary consequences.

With respect to this love of our Union, concerning which so much sensibility is expressed, I have no fear about analyzing its nature. There is in it nothing of mystery. It depends upon the qualities of that Union, and it results from its effects upon our and our country's happiness. It is valued for "that sober certainty of waking bliss" which it enables us to realize. It grows out of the affections, and has not, and cannot be made to have, any thing universal in its nature. Sir, I confess it, the first public love of my heart is the commonwealth of Massachusetts. There is my fireside; there are the tombs of my ancestors—

The love of this Union grows out of this attachment to my native soil, and is rooted in it. I cherish it, because it affords the best external hope of her peace, her prosperity, her independence. I oppose this bill from no animosity to the people of New Orleans, but from the deep conviction that it contains a principle incompatible with the liberties and safety of my country. I have no concealment of my opinion. The bill, if it passes, is a death-blow to the constitution. It may, afterwards, linger; but lingering, its fate will, at no very distant period, be consummated.

Tuesday, January 15.

Orleans Territory.

The House resumed the consideration of the bill authorizing the people of Orleans Territory to elect a convention to form a constitution preparatory to its admission into the Union as a free and independent State—Mr. Quincy's motion for indefinite postponement still under consideration.

Mr. Wright.—Sir, this bill is not, in my judgment, a violation of the constitution, nor have I a fear that it is fraught with those direful consequences with which the gentleman from Massachusetts (Mr. Quincy) threatens us. It will neither justify a dissolution of the Union, nor lead any citizen attached to it, even amicably, much less forcibly, to the contemplation of it, notwithstanding the predictions of that gentleman. That we are authorized to erect new States, I will prove both by theory and practice, and for that purpose I will first invite your attention to the articles of Confederation. By one section it is expressly declared that Canada may be permitted to enjoy all the benefits of the Confederation on the same terms with the other States of the Union. The thirteen States under this Confederation conducted themselves safely through the war; but finding, in 1787, that their requisitions had not been duly respected, and that New York had rejected some necessary commercial regulations, whereby their fiscal affairs were deranged, Congress, by a resolution, resolved that a convention of States should be held for the express purpose of amending the articles of Confederation. Under this resolution the Convention met, and proceeded to form the present constitution. Thus it will appear that they were to form the new constitution not ex pari materia, but out of the very materials of the Confederation.

As a conclusive evidence, you will find a number of the articles in each instrument literally or substantially the same, and thereby be justified in giving a construction of the letter of the constitution, so as to respect the spirit of the Confederation. By the third section of 4th article of the constitution, "New States may be admitted by Congress into the Union;" and by the next member of the same section, "the Congress shall have power to dispose of and make all needful rules and regulations respecting the territory or other property belonging to the United States"—hence I can have no doubt that Congress have the power to admit new States into the Union, that power being expressly given. It is however contended, that that power is limited to the admission only of those States that may be established within the limits of the United States, as demarcated by the Treaty of Peace. And the preamble to the constitution is relied on to establish that doctrine. "We, the people of the United States, &c., do establish this constitution for the United States of America." If this preamble is so imperious as to limit the positive provisions of the constitution, it will certainly limit itself to the States that formed the constitution—the negative of which has been determined. To prove which, here let me call your attention to the fact, that Vermont was not a member of the Confederation, nor was she a member of the convention that formed the constitution; she therefore was not one of the United States—was foreign as to them, and as distinctly governed as any other foreign power; she in 1791 was admitted into the Union, and the laws of the United States extended to her. She was not one of the old States, and was correctly admitted under the power to admit new States. Vermont was so repulsive to a confederacy with the United States, as not to be mentioned in the articles of Confederation. Can it be for a moment doubted that Canada, expressly mentioned, might be now received as a new State, by becoming independent, or by purchase, when Vermont has been admitted, who was not mentioned in the Confederation? Can there be an opinion that the framers of the constitution intended Canada should be excluded from the benefits of the constitution, when before invited into it? When, by the express letter of the instrument, "new States may be admitted," and when Vermont, not mentioned in the Confederation, has been admitted? Such a conclusion can never be the rational result of such premises. But it is objected, that, as this Territory was obtained by treaty, and after the formation of the constitution, it cannot be admitted into the Union as a State.

I have shown that new States may be admitted, that Vermont has been admitted, and that Canada was expressly entitled under the Confederation, and by the terms of the constitution may be admitted as a new State. "Congress may admit new States into the Union, and make all needful rules and regulations with respect to the territory or other property of the United States." This is certainly a territory, the property of the United States, and Congress as certainly may, if needful, that is, expedient, admit it into the Union. We are told, I presume to retard this measure, that the limits are in dispute, and that, if made a State, they cannot afterwards be settled by the United States. That this is not the case, I will prove by theory and by practice. By the treaty-making power vested in the President and the Senate, they may treat on all subjects within the treaty-making power, with foreign nations; and where the limits of any foreign power adjoining the territory of the United States are not ascertained to their mutual satisfaction, they certainly may settle them by a treaty of limits. This is the practice and usage of all nations, and the United States by a treaty of limits with Great Britain, did settle the beginning of their northeastern limits, at the river St. Croix, whereby they gave up seven miles to Great Britain, which was taken from a State—hence I presume no difficulty can arise on the subject.

The question was then taken on the motion for indefinite postponement, and lost: yeas 28, nays 78.

The main question was then taken that the said bill do pass, and resolved in the affirmative—yeas 77, nays 36.

Wednesday, January 16.

Bank of the United States.

The House resolved itself into a Committee of the Whole on the bill to renew the charter of the Bank of the United States.

Mr. Burwell moved to strike out the first section.

I have made this motion, sir, said Mr. B., because it allows the greatest latitude of discussion upon the important points which are preliminary to the examination of the details. It tries the principle of the bill, and may save much tedious and useless labor. Should a majority decide in favor of the Bank of the United States, as an honest man I will aid in forming a system best adapted to the state of the country, and most subservient to the purposes of such an institution. The gentleman from Connecticut (Mr. Mosely) has done justice to my conduct, and the fairness with which the subject has been treated. I have been anxious to present the question fairly, not from any doubt or indecision as to the course I should pursue, but from its magnitude, and the sensibility it has excited. It will be recollected by the committee, when the gentleman from Pennsylvania presented the memorial upon which the Secretary of the Treasury founded his report, on that, as on all subsequent occasions, my opposition was manifested; and I will add that the particular attention which my duty has compelled me to bestow on the bank, has confirmed more strongly former impressions.

The remarks I shall make are intended to show that Congress possesses no power to incorporate a bank; to show its effect on the government, and to satisfy the committee that the exercise of the power, even if possessed, is inexpedient. While, sir, I feel the most ardent desire to consult the convenience of the government and promote the prosperity of the community in general, I have not lost sight of the limits within which I am restrained by the Constitution of the United States and considerations of sound policy. It is my most deliberate conviction that the constitution of the country gives no authority to Congress to incorporate a bank and endow the stockholders with chartered immunities; and even if its dissolution should produce ruin to the merchants, and, what is of equal importance, embarrassment to the government, they would not be paramount to the sacred obligation of supporting the constitution; though I am persuaded the dreadful evils which have been predicted from the annihilation of the bank will soon vanish, and that no material shock will be produced by that cause. The construction which the constitution has received by the various persons who have at different times administered it, has been rigid or liberal according to the confidence in the General or State Governments. The unqualified extent given to its general powers, and the inclusion of incidental powers, as flowing from and belonging to particular enumerated grants, have constituted the essential points of difference among those who have divided upon the principles of the constitution. This has been the case not only in the exercise of authority where the right was questionable, but in cases where the right was undeniable, tending by its operation to increase the weight of the General Government. In giving to the constitution that construction which sound policy requires, and a just regard to the harmony of the States and the perpetuation of their Union dictates, I cannot find any part of it authorizing the exercise of a power which, from its nature, is obnoxious, its tendency alarming, and its influence in the hands of those who manage its concerns irresistible. The power to establish a bank cannot be deduced from the general phrases "to provide for the common defence and general welfare," because they merely announce the object for which the General Government was instituted. The only means by which this object is to be attained are specifically enumerated in the constitution, and if they are not ample, it is a defect which Congress are not competent to supply. I think this inference the stronger, inasmuch as those means were granted to us by those who had acted under the confederation and experienced its defects, and knew precisely to what extent power was requisite to provide for the common defence and general welfare. In relation to this particular subject, the proceedings of the convention itself furnish the plainest evidence, by rejecting the proposition to vest in Congress the right to grant incorporations. I readily admit the motive of deliberative bodies cannot always be known. Various considerations might have operated. They might have supposed the power already vested. But, it is incumbent on those who can place faith in an interpretation so repugnant to the cautious and guarded phraseology of the instrument, to demonstrate it. If the right to incorporate exists, it is a general grant of power, equally applicable to all the objects of incorporation, and cannot be assumed as a means to carry into effect any particular grant of authority. To my mind, it is much more natural to suppose a power to create monopolies had been surrendered, to quiet the fears of those who saw in the constitution the germ which would sooner or later palsy the vitals of the State authority. If the general phrases are not explained in the manner just mentioned, and powers so extensive and important are derived from them, it would be ridiculous to consider the jurisdiction of Congress restricted; they would confer equal authority to establish monopolies in all the various branches of individual industry and commercial enterprise. Sir, I will conclude this part of the subject by reminding you how essential it is, when we are giving an interpretation to the constitution, to which the States are parties, to assume only what clearly belongs to us. Moderation will inspire confidence, selfishness will excite disgust and suspicion.

The parts of the constitution which bear any analogy to this subject, are

1st. Congress shall have power to lay and collect taxes, duties, imposts, and excises, to pay the debts, and provide for the common defence and general welfare, &c.

2d. To borrow money on the credit of the United States.

3d. To regulate commerce with foreign nations, and among the several States, and with Indian tribes. And

4th. To make all laws which shall be necessary and proper to carry the foregoing powers, and all other powers vested by the constitution in the General Government, into effect.

It will not be denied that, if the establishment of a bank comes within the meaning of the power to lay and collect taxes, to pay the debts of the United States, and to regulate commerce, or is necessary and proper to carry the foregoing powers into effect, it would be a fair subject for legislation by Congress. But can any one pretend that a bank would be a mode contemplated by the constitution to lay and collect taxes on the people for the purpose of raising revenue? Would it comport with that wise principle of uniformity, and those guarded restrictions against unequal burdens on the people, which constitute the most valuable safeguard to the citizen? To understand these terms we must give them a meaning which has been affixed by their usual import. When we speak of the power to lay taxes, we understand by it a demand of money from the community, regulated by fixed and equitable principles, indiscriminate as to persons, and the species of property taxed. To suppose that every law which imposed burdens or brought money into the Treasury was constitutional, would destroy our equal system of government, and substitute a capricious despotism. It would revive the exploded doctrine of free gifts, benevolences, and that shameful train of extortions practised by the old governments of Europe. Does it fall within the power to pay the debts of the United States? This clause relates entirely to the application of the funds after they have been accumulated; it is in conformity with that article which pledges the public faith for debts which had been contracted, as well as those which might be created in pursuance of the authority to borrow money upon the faith of the United States. If the power to incorporate a bank grew out of the obligation to pay the debts of the United States, its charter should be so worded as to cease whenever they were extinguished; and it would be no longer for Congress to fix a definite period for its expiration. If the right of incorporation was ever meant to be given, it would most naturally follow from the regulation of commerce; yet, no one has contended Congress could create insurance companies within the States. Those who contend the bank is constitutional, consider it as necessary and proper in collecting the revenue. That it may be an useful instrument, I do not deny. It forms depositories convenient to the government; but, you should recollect, depositories equally safe and convenient can be procured without being purchased at the expense of exorbitant and invidious privileges to a particular class in the community. I apprehend the constitution means something extremely different when it empowers the General Government to collect taxes; it relates exclusively to the authority thus given to Congress of employing compulsory process in coercing the payment of taxes; it enables Congress to create, within the jurisdiction of the States, officers of the revenue, and, through them, to exercise over the property of the citizens a concurrent jurisdiction, from which they otherwise would be precluded, and from which they had been precluded before the adoption of the constitution; it enables them to impose penalties and forfeitures, and to inflict punishment for resistance to their authority. But, sir, admit for a moment the bank may be formed to collect the revenue, ought it not to be exclusively used for that object? Whence the power to make it an instrument of commerce? Why invest it with a capital immense in amount, and sovereign in its control over the external and internal commerce of the country? Sir, I must again call your attention to the limited nature of our Government; we must administer it as we find it, and not as we think it ought to be. Under this view of the subject, so long as I understand the right to "lay taxes" to consist in drawing supplies from the people for public purposes, and not to tax one portion of the community for the benefit of another, and "to collect them," the right to enforce payment, I cannot construe them to authorize the establishment of a bank. Sir, a bank has been improperly considered a means of executing some power exclusively given to Congress. The nature of incorporations is so clearly a distinct class of political power, that, before they can be converted into means incidental to an object without the jurisdiction of the General Government, they must be shown to be absolutely necessary. Permit me to ask, how has it been ascertained that a bank is necessary to the operations of the Government? Has the experiment been tried? Upon a question involving a breach of the constitution, it would be safer to be guided by experience than conjecture.

Sir, I am well aware that I can add nothing new upon the constitutional points. The subject was more thoroughly examined in 1791, and more ably elucidated than any other since the adoption of the Government. The celebrated speech of Mr. Madison, to which I ascribe my conviction, has been recently presented to us in the newspapers, and gentlemen must be familiar with it. I cannot give additional weight to the arguments, but I thought it proper to call the attention of the committee to that part of the subject by the remarks I have made.

I said, sir, it must be shown that the bank is necessary to the operations of the Government—without its aid our fiscal concerns cannot be managed. So far from subscribing to the necessity of the bank, I believe the revenue would be equally safe in the State banks, and could be distributed with inconsiderable difficulty. The revenue received in most of the States is nearly equal to the expenditure within them, and when a deficiency occurred in any one, it could be supplied by arrangements with the different banks, by transportation, or inland bills of exchange, in the manner that the public engagements are fulfilled abroad. I will venture to assert the Secretary of the Treasury will find no difficulty in contracting with individuals and corporate institutions, upon the most ample security, to transfer the public revenue upon terms equally advantageous to the United States. Among the several States commercial intercourse is great, and daily increasing; the constant traffic which the different portions of the country maintain with one another, will give facility to the operations of the Government, and obviate the obstacles which are anticipated; the very commerce which enables the Treasury to remit with ease immense sums to every part of Europe is the result of this interchange among the States, and insures equal facility at home. Where, then, is the necessity for this bank? The accommodation of the bank to the Government in times of emergency, and the use of its resources to support public credit, have been urged as motives for its establishment; how far such considerations weaken constitutional objections, it is needless to state. If, sir, the bank becomes a source of supply to the Government to an adequate extent, it ceases to be one to the merchants. It therefore cannot answer in both capacities. The same necessity which throws the Government upon the charity of the banks renders it incapable of discharging the obligation, and while the funds of the institution are locked up in the Government, its commercial functions must cease. The relief which sudden and temporary embarrassments require, can, at all times, be administered by the State banks, and, therefore, supersedes the necessity of aid from this bank. Whenever, by disasters, the ordinary sources of supply are exhausted, or the unavoidable objects of expenditure exceed the revenue, a more copious and permanent aliment will be found in the wealth and capital of the citizens than by loans from banks. Instead of diverting the active and productive capital from useful channels, the sluggish and inert mass will be drawn forth in its aid, to support public credit and cherish private enterprise. But, sir, is it prudent to rely upon an institution that may refuse you assistance? What will be the influence of such an institution on the Government, and the country at large? It cannot escape your recollection that the establishment of the Bank of the United States was the origin of a system which assumed as its basis the enlargement of the national jurisdiction. Whether the principles of expediency to which it owes its birth be regarded, or the overweening influence it established over the moneyed institutions and merchants of the States, the charge, to say the least, is plausible. The close and intimate connection between the Government and bank—the dependence of the former for loans, and the latter for public deposits, have given the Executive branch its full share of influence and odium—shows incontestably it was created to augment the power of the General Government, and the Executive in particular. Yes, sir, it was the commencement of those political animosities which have poisoned the sources of social intercourse; it was the origin of that doctrine of constructive power which abrogates the constitution and nullifies the restrictions imposed upon Congress. So long as it exists, the body politic will experience the agitations and convulsive throes of well-grounded jealousy in the States.

Sir, in the administration of this Government two things alone are necessary to insure its durability. You must first avoid every measure which will produce uneasiness among the States, or, second, that will extend the jurisdiction of the United States Government to subjects purely local. I do not mean that the rightful authority of Congress is to be abandoned for fear of giving offence, but, whenever called on to take a step which will produce uneasiness, you should be perfectly satisfied the letter and spirit of the constitution bear you out. Do not gentlemen perceive the tendency of this measure to involve us with the States upon delicate points? Has not the United States' Bank produced serious alarm? Will not the alarm be increased by its continuance at this time? Yes, sir, some of the States have already taxed this institution, others have waited under the expectation we shall render a collision unnecessary. Suppose the charter renewed, and the stockholders should be taxed in such a manner as to destroy, virtually, the privileges you have guarantied to them. Are you to leave them unprotected, or will you draw the sword in their behalf? While you have time, avoid a situation not less perilous than the most serious foreign war. Since the establishment of the bank, the States have created banks—their people have accumulated capital, and they will not tamely witness the perpetuation of an institution whose strength can at any moment overthrow whatever State bank they may mark for destruction. However paradoxical it may appear, I consider the General Government strengthened by narrowing its jurisdiction; it will produce disunion whenever they interfere with local concerns. The habits, local interest, and passions of this country vary, and no one is a competent judge of what will suit the feelings of the State out of which he lives. But, sir, there are general principles in which our feelings and interests are identified; there are subjects upon which we may safely act, and trust to the co-operation of every man and State in the Union. Does the bank affect the people locally? The answer is obvious: it not only undertakes to fix the amount of capital, but interferes with the rights of property most essentially—it may change the fundamental principles of State law as to the liability of property for debts, and the mode of recovering them. Let me caution you against the renewal of the charter; it is pregnant with the most baneful consequences to the tranquillity of the country. Is it not better to sacrifice this golden calf upon the altar of concord, restore confidence and harmony among individuals as well as States, and to reunite the lovers of the constitution?

In the report of the Secretary of the Treasury, the convenience of obtaining loans from the bank is mentioned as an inducement to establish a National Bank. To me the abuse of this convenience is more dreaded than any other evil which will follow from the measure. Where have you seen a National Bank, connected with the Government, which has not ultimately ruined the circulating medium of the nation? It is a notorious fact that money has depreciated seriously, from the unlimited circulation of paper, and if the Government should be compelled, by necessity, to use the funds of the bank, they must permit the increased circulation of its paper, although its money capital remains stationary. In this situation the Government must tolerate an operation which will increase the evil of which we complain. The example of England is a salutary monition to us, and we ought to profit from it. In that country there was a time when the stability of the bank was a national phrase, "As good as the Bank of England." How is it now? The funds of the bank have been borrowed by the Government—its paper circulation increased, and Parliament has been compelled to make it a tender for the payment of all contracts. Who, sir, can estimate the complicated mischiefs of a depreciated paper currency, without specie for its redemption? Should we be involved in war, or our property seized abroad, nothing can present universal bankruptcy—one wide-spread ruin will pervade the continent. At this time the country is inundated with paper bottomed upon the whole floating and real property of the community: should an alarm exist, can these funds be converted into money to redeem its credit? Certainly not. Will it not be prudent to diminish the extent of this evil by putting down this bank which is the fountain from which the whole system flows? It is of little importance, as it regards the internal trade of a country, what constitutes the representation of property. Paper, iron, or any thing else, which passes current, will answer every purpose of barter and trade; but, in its commerce abroad, it is indispensable that the circulating medium should be equally valuable and readily acknowledged among all commercial nations; otherwise, all the operations of commerce, carried on with money, will be abandoned or prosecuted under disadvantages equal to the difference in the value of the currency at home and abroad. In countries actively engaged in business, this branch of trade is not only great in amount, but by far the most profitable. How unwise, therefore, not only to substitute for the precious metals paper currency, whose value is confined to the United States, but to augment the quantity until it depreciates even among ourselves.

Thursday, January 17.

Bank of the United States.

The House resolved itself into a Committee of the Whole on the bill for renewing the charter of the Bank of the United States—the motion for striking out the first section still under consideration.

Mr. Fisk.—Mr. Chairman: I regret that we are called upon to vote for or against striking out the first section of this bill, at this time. I could have wished that, upon a bill of so much interest and importance, we could have proceeded to have filled the blanks, and made such amendments as would have obviated many objections which may be urged against it in its present form. I am not prepared to give my vote in favor of a renewal of the charter of the Bank of the United States, either upon the terms upon which it was originally granted, or in the manner contemplated by this bill; yet, upon conditions less objectionable, I should feel myself bound to vote in favor of a renewal. But the question presented upon this motion, is not upon what terms this charter shall be renewed, but whether it shall be renewed upon any terms, subject to any conditions Congress may impose.

In this view, I consider it the most important subject upon which this Congress will be required to act. It is determining a question which is connected with our finances, with the circulating medium of the country, and with our agricultural, commercial, and manufacturing interests; and, as such, it cannot but be interesting to every class of our citizens.

The interests and prosperity of the United States are not only intimately, but inseparably, connected with trade. The market of the farmer depends greatly upon the merchant and the shipper. And the price and demand of every article of produce are in a great degree regulated by the difficulties or facilities of payment. Let the difficulty of paying be increased, and the price of produce immediately falls; for the demand for exportation becomes very limited, the markets are overstocked, and prices reduced. Any sudden check to our commerce, whether produced by our own municipal regulations, or the outrages of foreign powers, checks the market and the price of produce; so that not only the merchants, but the farmers feel its effects. I scarcely need recur to the history of the times when trade was principally suspended in this country, to show how severely the suspension operated upon every class of our citizens, and in every part of the country. This period in our political annals will be long remembered. So great was the distress in some States, and agricultural States, too, that their Legislatures deemed it necessary, for the protection of the debtor from the power of his creditor, to stay the administration of justice, and prohibit by statute the issuing of an execution for the collection of any debt.

This proves the connection which subsists between the two great agricultural and commercial interests of this country. Agriculture, commerce, and manufactures constitute the source of our wealth, revenue, and prosperity. To foster and cherish the principles upon which rest our existing hopes and future prospects, can never be a question of doubtful policy with a wise and patriotic legislature.

We have seen that commerce is essential to our interests; but commerce will not flourish without credit. It never has prospered independent of credit. As credit is essential to trade, so is punctuality to support credit. Look at the business of any commercial people, and see how much of it is done upon credit; and see the integrity and fidelity with which punctuality is maintained in order to support their credit.

For several centuries past, banks have been the successful medium through which credit has not only been preserved, but great wealth acquired. This assertion is warranted by the history of these institutions, and of the countries where they have been patronized. The first bank established in Europe, was at Genoa, in 1407—four hundred and four years ago; this was soon followed by one at Venice.

The Bank of Amsterdam was established in 1609, and shortly after those of Hamburg and Rotterdam; and the Bank of England in 1694; the Royal Bank at Paris in 1718; the Bank of North America in 1784—a memorable period in our history—and the Bank of the United States in 1791.

All these different institutions show, that enlightened legislators have entertained but one opinion upon this subject both in Europe and America for the last four hundred years. They have seen and acknowledged their utility. Banks have long since been considered not only essentially useful in the transaction of commercial concerns, but as highly necessary to aid the fiscal operations of Government. And a more unanswerable argument cannot be urged in favor of their general utility than their uniform success; to this may be added the prosperity of the people and the countries where banks have been supported. Their immediate advantages are, a convenient circulating medium; the safe depository they afford for cash and funds. And they serve to keep the standard of money steady and correct; to insure punctuality; to preserve credit; to inspire confidence, and to promote a spirit of industry and enterprise. They are not, as many have supposed, in their nature hostile to Government and dangerous to liberty. They rather form a barrier to tyranny and oppression. Their principal business is to lend money at the common rate of interest, and thus prevent usury. The owners of banks are generally rich men, who have not only their personal liberty, but a large property to risk, by sedition, treason, and rebellion. It is their interest to resist oppression. We need scarcely point to the Continent of Europe for proof of the fact, when we assert, that trade and banks cannot flourish where despotism prevails. Despotic power generally ruins trade and banks, but no instance occurs in history where banks, not under the control of Government, have ruined a State. A bank owned by Government, and under its command, would be an engine dangerous to the people. But when owned by individuals, neither the people nor the Government have any thing to fear from it. It is then dependent on both for its business, prosperity, and usefulness.

With the evidence which both history and experience offer to our reflection, we cannot doubt the utility of banks, nor deny but that they have been beneficial to us. And we are justified in the conclusion, that, under proper regulations, they may subserve the best interests of the people of the United States. They are now in successful operation in almost every State in the Union, and that they have been useful, the present prosperous state of the country abundantly proves. We enjoy as perfect security for life, liberty, and property, as any people under any Government ever did. These are the great objects of a good Government. And we may triumphantly ask, where is the nation or people that enjoy these with more freedom and safety than the American people? A parallel for our liberty and prosperity, for the last twenty years, is not to be found in the history of man. Our wealth, population, and resources, have increased beyond what any one would have calculated or imagined, and beyond what strangers and foreigners now believe. Industry, wealth, and contentment, pervade every quarter of our country, and poverty and oppression are unknown to our citizens.

In 1791, the year this bank was incorporated, our exports amounted to about eighteen millions of dollars; and in 1804, they had increased to about seventy-six millions, gaining in thirteen years fifty-eight millions; and our tonnage in about the same proportion.

Much of this prosperity is to be attributed to the active capital which has excited industry, and a spirit of enterprise among us, and the activity of this capital has been in a great degree created and promoted by the Bank of the United States. Its operations have been extensive in all our trading towns. It has aided in loans and discounts, and assisted in the collection, safe-keeping, and transmission of our revenues. It has been the depository of our Treasury, and is now become incorporated with the administration of the fiscal department of our Government. The connection which it has formed with almost every branch of business in the country, is not slight and trifling, and so easily to be severed as some seem to believe. Its operations are deeply interwoven with the dealings and concerns of all the men of business in the United States.

With a capital of ten millions, it has furnished accommodations of fifteen millions a year. This has been employed principally in trade; in making prompt and cash payments to our farmers for their produce. This, again, has furnished to our citizens a ready and profitable market for every article of produce. These high profits of a good market have gone into the hands of the farmer, to cultivate, improve, and enrich the country. And travel through any State in the Union, and their effects may be readily seen, affording a prospect, consoling and elevating to the philanthropist and the patriot. The land is highly cultivated, good buildings, turnpike roads, bridges, and other expensive improvement, indicate the wealth of our citizens, and the prosperity of the country. Money has been freely circulated, trade has been active, produce high, and our country has been improved by these unexampled advantages to a degree far beyond what the most sanguine calculations, twenty years ago, could have anticipated. And yet, sir, we are gravely told that this bank has nearly ruined the country; that it is threatening our best interests with destruction. As well might gentlemen tell us that total darkness prevails at noon-day, or that the sun, in his meridian splendor, affords neither light nor heat to any part of this globe.

The principal portion of the trade and business of the United States has been conducted by a paper medium; metallic has scarcely been seen. The amount of this circulating medium is, say fifty millions. Now what is proposed by denying a renewal of the United States' Bank charter? That this bank shall close its concerns, and of course stop all its accommodations. This must necessarily check and change at least one-third of the circulating medium of the country. It will undeniably require $24,000,000 to be directed to one operation, and for a time to one point—for the capital is $10,000,000; this is to be collected to divide among the stockholders. There are $19,000,000 due to the bank; this must be collected. This will occasion a demand for this amount from other sources; it must be paid. And the $5,000,000 in the bank makes the sum of $24,000,000, which must be suddenly called in. The effect this will have upon the various interests in the country can neither be described nor conceived. It must inevitably give a general and heavy shock to all paper credit; this credit, so much and profitably in operation, must receive a severe, if not a mortal wound. And what substitute have we for this when it shall be destroyed? Silver and gold coin cannot be relied on. There is not from the best estimate an amount to exceed $10,000,000 specie in all our cities and trading towns, and this will be collected by this bank. The price of all stocks, and every kind of produce and species of property must suffer a great depression, for a scarcity of money enhances its value, and consequently depresses the value of every other species of property. That this sudden, if not total change in our system, must occasion great embarrassment, produce failures, disappointments, and distress, among our citizens, is certain.

Put down this bank, and how then are your revenues to be collected? Through the medium of the State banks? You do what no prudent man, in his individual concerns, would think of doing. You discard a faithful, honest, responsible agent, whose integrity and fidelity you have known for twenty years, and you place your estate in the hands and at the disposal of twenty or thirty entire strangers, of whose character and responsibility you know nothing, nor have the means of acquiring any knowledge, and over whose conduct you have no control. Should an individual act thus with his property, he would be deemed to have lost all regard for it, if not considered a madman. In resorting to the State banks, we are offering the amount of our revenue as a bounty for intrigues, cabals, and factions, through the country. In almost every State there are a number of banks, and each will endeavor to get the revenue collected in that State, to keep and trade with. It must be given to one, or divided among them all. If one is selected as the favorite, all the rest become jealous, dissatisfied, and exert their capital and influence against the favorite bank and its patron, the Government. This will awaken a spirit of faction in every State, yet unknown in this country. If all are to be gratified in their request for the deposits, the Government must open separate accounts with all the different banks in the country, to the amount of fifty or sixty; and new companies will be formed, and new applicants request to divide the business, and share the profits. Indeed, there will be no end to the scenes of speculation and intrigue, which will soon appear, if this course is adopted by the Government.

Mr. Seybert.—It may be said that this subject has been exhausted by the discussions of the ablest politicians of the country. I will premise, the remarks which I shall offer are intended solely to justify the vote which it is my intention to give on this momentous occasion.

The question pending the United States' Bank has excited a peculiar interest throughout this nation, more especially in our seaports. The dissolution of this institution, which from its limitation, will expire on the fourth of March next, has been portrayed in colors of the darkest shades, and the distresses which many maintain will be consequent to that event, call seriously for a fair and deliberate investigation. I hope, sir, I shall be pardoned for imposing on the patience of the House, when it is recollected that the community which I represent have employed four-tenths of the capital stock of the United States' Bank. If evil consequences are to attend the dissolution of this establishment, or if beneficial results proceed from its continuance, in either case I must feel myself essentially interested; it is therefore my wish to be distinctly understood upon the important principles which have connection with the great question now before us.

At the last session of Congress, I presented the memorial of the President, Directors, and Stockholders of the Bank of the United States; at that time I entertained no positive opinion on the subject; the discussions which took place in the committee to whom the memorial was referred, necessarily, as a duty on my part, excited that attention which the importance of the question imperiously demanded. Under circumstances of doubt, I voted in favor of reporting a resolution in support of the bank, for the purpose of giving to the establishment every chance which reason could urge; at the same time reserving to myself the right to pronounce a final decision, according as policy and expediency, but more especially as principle should dictate. I will admit, sir, that this is not the time or place to institute the general inquiry, whether banks are or are not beneficial to a nation? Because, whether the charter of the United States' Bank be renewed or not, the several States, who have the unquestioned authority to incorporate bank establishments, have already created many, which it is not in our power to control. I do not hesitate to declare, though many persons in the United States are decidedly opposed to a banking system, under every possible circumstance, I am not of this class. Experience has proved, in a manner very satisfactory to my mind, the advantages which are derived from the banks when they are impartially directed, and when the accommodation afforded by them is prudently employed; the great difficulty seems to be to confine the system within its proper limits. I understand the proposition as applicable to the agricultural, manufacturing, and commercial interests of the United States.

For my proofs of this proposition, I will not rely upon the famous Bank of St. George, at Genoa, whose authority, by a gentleman from New York, (Mr. Fisk,) has been considered of much weight. I will recall to the mind of my friend the remark of an intelligent traveller, who, when he visited this bank of antiquity, exclaimed: Here lies concealed the enigma, whether the bank possesses millions of millions, or whether it is indebted millions of millions! He concludes, Upon this important secret rests the safety of the State. Unhappy State, say I, whose safety depends upon a secret concealed within the vaults of a bank. Perhaps to a development of this secret may we attribute the present servile condition of the people of the once far-famed and powerful Republic of Genoa.

Sir, I am decidedly opposed to a prominent, and what to me appears to be a very dangerous feature in the bill now under consideration. I allude to the eighth section, which admits of an increase of the present capital stock of the bank. Adopt this provision, you will thereby create an Herculean power, which will have at its mercy all the minor institutions of the States; thus constituted, it can oppress and destroy them, as whim or interest may dictate. The steps which have been taken preparatory to a dissolution of the present bank, it is said, occasion much embarrassment, and threaten with ruin many of our citizens; if the present capital of ten millions can thus affect society, who will pretend to accumulate present evils, or risk entailing misery on posterity, solely for the purpose of a temporary gain to the Government? In this question Pennsylvania is deeply concerned; she has several millions of dollars invested in her banks; this to her is a valuable source of revenue; upon this may she predicate much of her future prosperity; hence will she derive the funds requisite for future internal improvements; but if you fill up the blanks in this section with a considerable sum, all these prospects will be blasted forever; you will thereby destroy the tree from whose ramifications were to emanate the blessings of peace and the sinews of war. Those of her representatives who may deem it politic and constitutional to vote for a continuance of the charter of the United States' Bank, ought surely to oppose any increase of the present capital; we have been told that that which now exists has been found sufficient for all purposes, at a time when our commerce was much more extensive than we have reason to suppose will soon again be the case.

The history of the banks in our country informs us, that the one usually termed the Bank of North America was the first establishment of the kind which received the sanction of the Government. This institution was incorporated by an act of Congress, in the month of May, 1781, under the authority of the "Articles of Confederation." The present Bank of the United States was incorporated by an act of Congress, on the 25th of February, 1791, during the operation of the present Constitution of the United States.

Without an attempt to examine every hypothesis, which has been or which might be proposed, respecting the constitutionality of the principle, I will content myself with the statement of the case, such as it appears to my mind. The first public act which I performed as a member of the Congress of the United States, was, to swear solemnly that I would support the Constitution of the United States. It therefore is my duty to examine and consider its precepts, according to the best of my ability.

The "Articles of Confederation" and the present Constitution of the United States do not differ as regards any power delegated by the States to Congress, touching charters of incorporation. I can never persuade myself that the constitution was intended other than to have a definite meaning; or that it was ever contemplated to speak an equivocal language; ambiguity arises solely from the misconceptions of its interpreters; it is very plain and of easy comprehension, especially as it relates to the present question, since it is totally silent on the right to create corporations—its wisdom is further illustrated by the special provision for the only exclusive privilege which is consistent with a free and equal government, and that is in favor of genius.

The powers delegated by the States are special and defined, and, it is expressly declared by the constitution, that "the powers not delegated to the United States by the constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people." This language needs no interpretation. I cannot for a moment permit myself to suppose, that the patriots who were tested during the long-continued uncertainty of the most important events of our Revolutionary period, and to whom was ultimately assigned the right and power to construct the instrument which is to guide us in the political labyrinth—that they intended this their great work should alone be explicable by that refined reasoning to which common sense is a stranger, I never can admit. Surely that which they framed for the good and security of every individual in the nation, must be expressed in a manner to be understood by ordinary men, and those whom it was intended to direct. Sir, if simplicity was not originally contemplated by the framers of the constitution, why the imposition on the people in publishing it to the world? Was it not a prodigal waste of labor and materials, to furnish every citizen of our country with a copy of that which can only be understood by professional men, or such as are eminently skilled in scholastic research? It had better remain a secret, concealed amongst the musty rolls in the archives of State, than be a puzzle for mankind. As long as this instrument is preserved pure and untarnished, it will receive a becoming respect from your fellow-citizens—it will be regarded as "the stupendous fabric of human invention." Remember, the present argument, in several important points of view, affects posterity in common with ourselves. You had better commit the unintelligible jargon to the flames, than by the agency of construction, neutralize wisdom by folly. Sir, if we have a constitution which the people cannot understand, I then say, cut the original into slips, and provide the means for a better; or, if that is not to be done, and we are to be ruled by the iron hand of power, in that case, as one of the American people, I will pray you to be graciously pleased to grant a plain bill of rights for our better government.

If we look back, and attentively view the occurrences which took place, when the law incorporating the present bank of the United States was enacted, we shall find our reasoning supported and confirmed by many important circumstances; we shall then perceive, that the act of incorporation was opposed on constitutional ground, by men who were and continue to be esteemed for their talents, political skill, judicial knowledge, probity and patriotism; and it has been admitted, that the arguments formerly urged are unanswerable. That the power to create corporations was never intended to be ceded on the part of the United States, is proved beyond all manner of contradiction; for we are told by the highest authority, by one who was a member of the General Convention, that it had been proposed to cede to Congress the power to create corporations, and that the proposition was rejected, after a deliberate discussion. In my opinion this decision is in proof of the sagacity and wisdom of those who made it; it was highly justifiable to retain this power to be exercised by the States; because, corporations are generally founded on circumstances, which are entirely local—as such, they can be better understood by the Legislatures of the respective States, than by that of the General Government.

The experience of every session proves that the decisions of Congress vary with the men who at different times compose that body; therefore, the act of February, 1791, can have no force in settling the principle contended for.

I have heard it urged, that the States have recognized the constitutionality of the United States' Bank, by their laws. I know of no law in any of the States, which declares this charter constitutional. Were it even proved, that several of the States had published this declaration, with me it would signify nothing, unless the sanction of two thirds of the States was thus had. On a former occasion, several of the States were induced, from peculiar circumstances, to relinquish for a time their right in favor of a particular case—I allude to the first establishment of the Bank of North America. If this had been intended to decide this very important question, without any reservation of their power in other cases, they would have expressed it in the most positive and unequivocal manner.

Sir, it may be asked, how did the Congress, whilst acting under the "Articles of Confederation," incorporate the Bank of North America, though their powers were no more extensive than those of the present Congress? We shall not lose by this investigation—they declared that "the exigencies of the United States rendered it indispensably necessary that such an act be immediately passed," and, at that period, the Board of War confessed they had not money sufficient to pay the expense of forwarding an express to the Commander-in-chief of the Army! Notwithstanding such urgent necessities on the part of the General Government, they were too conscious of the rights of the States to attempt a usurpation of authority, or to pretend to force this act without their sanction; accordingly, we find the resolution by which this bank was established followed by another, which recommended to the Legislature of each of the States the necessity to pass such laws as they judged requisite for giving the ordinance, by which the subscribers to the Bank of North America were incorporated, its full operation; every provision in the charter of this bank, to have full effect, was recommended to the Legislatures of the several States for their approbation. (See Journals of Congress for 1781, vol. 7th, pp. 257 and 258.)

It is a well-known and an important fact, that the subscribers to the Bank of North America did not rest satisfied of the authority of Congress to incorporate them; subsequently to the original act of incorporation, they accepted from the Legislature of Pennsylvania a charter by which their privileges were very much abridged.

Some maintain, the States having made it penal to pass counterfeits of the notes of the United States' Bank, is in proof of their recognizing the constitutionality of the institution. No one will pretend that these laws were intended other than to guard the people against fraud. These statutes were enacted without any connection with or reference to the principle upon which the original act was founded. It is but too well known, notwithstanding these salutary provisions, that counterfeit bank notes of every denomination are in daily circulation. I will ask, what would be the case if such laws had not been passed by the States? Sir, if it requires all our care to prevent an inundation from such bank paper as is acknowledged to be genuine, for Heaven's sake do not risk the security of the people, by an indirect sanction of such as is known to be spurious!

Friday, January 18.

A motion was made by Mr. Fisk, that the House do now adjourn; and the question being taken thereon, it was determined in the negative—yeas 6, nays 59.

Bank of the United States.

The House again resolved itself into a Committee of the Whole on the bill to renew the charter of the Bank of the United States.

Mr. Burwell's motion for striking out the first section being still under consideration.

Mr. P. B. Porter.—Mr. Chairman: As this bank has excited so extraordinary an interest in every part of the United States, and particularly in the State which I have the honor to represent; as I am apprehensive, from what took place yesterday, that I shall be found, on this question, in opposition to a majority of my colleagues; and, (what will always be an imperative motive with me,) as I think this bill aims a deadly blow at some of the best principles of the constitution, I feel it my duty to state to the House the grounds on which I shall be constrained to vote for striking out the section now under consideration.

I acknowledge that I had not, until lately, paid any particular attention to the question of the constitutionality of this institution. I stand, therefore, in this respect, on safer ground than the respectable member from North Carolina (Mr. Macon,) for I have no reason to suspect myself of any long-rooted prejudices on the question. The Bank of the United States was established at a time when I was not in the habit of troubling myself with such questions. I had been accustomed to think of it as an institution, the constitutionality of which was conceded by common consent. But, sir, when the question was again stirred, I felt it my duty to give it a thorough investigation before I should sanction it by my vote. I have given it, if not a thorough, at least a candid and impartial examination; and the result has been, a full conviction that we have no right to incorporate a bank upon the principles of the bill on the table, or rather, upon the principles of the original charter, which this bill proposes to renew. The ground of my objection is, that it assumes the exercise of legislative powers which belong exclusively to the State Governments.

I shall not touch the question of the expediency of this bank, much less the expediency of banking generally. If I were competent, which I confess I am not, to the task, I should think it a very unprofitable one, to follow the gentleman through all the mazes of the banking system—a system, sir, about the various and important operations and effects of which on civil society, aside from a few obvious truths which it furnishes, I have found that those gentlemen who have professed to understand them best, have differed most. As I propose to confine myself to the constitutional question solely, I hope I shall be allowed to take a little broader range on this point, than has been taken by the gentlemen who have preceded me.

I am aware how ungracious constitutional objections to the powers of this House are with those, and there are many such, who believe that the powers of the Federal Government are, at best, too contracted; and who would be glad to see all the State rights merged and sunk into a consolidated government. Whatever may be my speculative opinions on this subject, I can never be influenced, by motives of expediency, to swerve from my allegiance to the constitution. This sentiment is indelibly fixed on my mind, and I trust it is a common one to the members of this committee. That, in adhering strictly to the obligation we have taken to support the Constitution of the United States, we not only perform a sacred duty to ourselves, but we render a better service to the real and permanent interests of our country than we could possibly render by a departure from that obligation; even though that departure were to avert so serious a calamity as a general bankruptcy—a calamity which, in order to alarm the timid, has been held out as the inevitable consequence of a refusal to renew this charter.

I should be surprised at the general acquiescence which seems to have been yielded to the constitutionality of this institution, did I not believe that others had been as superficial in their examination of the subject as I had myself. When objections are made to the constitutionality of the law, the people, in the cursory views which they are accustomed to take of such objects, are apt to adopt, as the tests of its constitutionality, the powers of the State and Federal Governments collectively; and if they find nothing in the law offensive to the principles of civil liberty, nothing uncongenial with the spirit of a Republican Government, they rest satisfied, and do not trouble themselves with nice distinctions between the powers peculiar to the one or the other of these Governments. Such reasoning would, however, ill become the sagacity of this House.

One of the most serious dangers with which our Government is threatened, and it is a danger growing out of the very nature and structure of the Government itself, consists in its tendency to produce collisions between State and Federal authorities. The Federal Government, as was observed by my learned colleague, (Mr. Mitchill,) is imperium in imperio, a government within a government; and the misfortune is, that there exists no friendly third power to decide the controversies which may arise between these two great, independent, and, in many respects, rival authorities. The public peace must be kept, if kept at all, by the conciliatory dispositions of the parties themselves. As then we have a common interest in the preservation of both these Governments—as we are as well the subjects of the imperio as of the imperium, we ought to act with great circumspection and delicacy in the assumption of powers which do not clearly belong to us. It is better to forego the exercise of powers to which we are entitled, if the exercise of them is not very important, rather than hazard the assumption of doubtful ones, the fatal consequences of which my honorable friend from Virginia (Mr. Burwell) has so justly deprecated.

The great line of demarcation between the powers of the State and Federal Governments is well understood. The powers of the State Governments extend to the regulation of all their internal concerns: those of the Federal Government to the management of all our external relations—external as regards the individual States, as well as the States in their collective capacity. The general ideas upon which our Republic is founded, are these: That small territories are better adapted to the successful administration of justice than large ones. In a Republic, where the people are the sovereigns and source of power, it is important that, in order to enable them to execute this power discreetly, they should possess correct information in relation to the character and conduct of their rulers, and in relation also to the character of the measures which they pursue, or ought to pursue; and this information is better attained in a small than in a large territory. The individual States have therefore reserved to themselves the exclusive right of regulating all their internal, and, as I may say, municipal concerns, in relation both to person and property. But a single State may be inadequate to its own protection against foreign violence; it may also be unable to enforce the observance of proper rules and regulations for carrying on its foreign trade and intercourse. The Confederacy of the States is therefore formed for the purpose of attaining these two objects, namely, the regulation and protection of the trade and intercourse of the States with each other and foreign nations, and their security against foreign invasion. It has some other objects in view of minor consequence, and immediately connected with these principal ones. The Constitution of the United States is the basis of this confederacy; and it is only necessary to read the constitution to perceive that it is nothing more than a delegation of specific powers for these specific purposes, and that the general sovereignty of the States over their respective territories is expressly retained by the States.

But, sir, independent of these specific powers and duties of the Federal Government, it has another and distinct set of powers and duties to perform and execute. The national domain, as it has been called, embracing the lands acquired by the Revolutionary conflict; the lands since purchased of foreign nations; and the lands ceded by the several States to the General Government, belong to the United States in their federate capacity; and no individual State, as such, has any claim to or jurisdiction over them. As to these lands the powers of the United States are sovereign, independent, and complete: and the Congress of the United States is the only legitimate authority for the exercise of this sovereignty. The powers of Congress, then, in relation to these territories, include the powers of both the Federal and State governments, in relation to the States. I have adverted to this branch of the powers of the Federal Government as a means of dispelling the obscurity which has been thrown over the constitutional question, to which I shall soon come, by confounding the powers of Congress over the States, with their powers over the territories. Arguments, to which I shall have occasion to advert in the course of my observations, have been used to justify the exercise of particular powers within the limits of the States, from our acknowledged right to and practical exercise of similar powers within the Territories.

In discussing constitutional questions, then, we lay down these axioms:—That in relation to the territories, the powers of Congress are supreme and exclusive; that in relation to the States, they are specifically defined and limited by the constitution—and that we have no right to exercise, within the limits of a State, any power as resulting from the general rights of sovereignty; because that sovereignty belongs to the States and to the people, and not to the Federal Government. To show that these two last positions are correct, I will read the tenth article in the amendment of the constitution: "The powers not delegated to the United States by the constitution, nor prohibited by it to the States, are reserved to the States respectively, or the people."

As, then, the incorporation of this bank involves the exercise of legislative powers within the jurisdiction of the States, in relation to the rights of property between the citizens of those States; and as no power to incorporate a bank, eo nomine, is to be found in the constitution, it would seem sufficient for us to rest the argument here, by a mere denial of the power, and to call on the advocates of the bank to show its constitutionality. An attempt to prove this constitutionality has been made—not, however, sir, by arguments advanced by gentlemen on the other side of the House in their places, (for they have, so far, observed, and I understand that they will continue to observe, a profound silence on this question,) but by arguments which have been gratuitously introduced, by the agent of the bank. I allude to the pamphlet which has within a few days past been printed and distributed among the members, containing the celebrated argument of General Hamilton, "on the constitutionality of a National Bank." As that pamphlet is de facto, if not de jure, before the committee, I will, if the committee will indulge me, attempt to examine some of the principal arguments contained in it, and I will also notice some additional ones, advanced yesterday by my honorable friend and colleague on my left, (Mr. Fisk.) In the course of the observations which I have to submit, I shall, without doubt, repeat arguments and remarks made by the gentlemen who have preceded me, and others which are familiar to the members of the committee. My excuse must rest in the difficulty of taking a connected view of the subject, without such repetitions. If I shall be so fortunate as to throw a single new ray of light on this important question, I shall feel amply remunerated for my trouble, and I shall think the time of the committee not altogether misspent.

The first argument in this pamphlet is founded on the sovereignty of the powers of Congress. The Federal Government is said to be sovereign as to all the objects for which that Government was instituted. A sovereign power includes, by force of the term, a right to all the means applicable to the attainment of the end for which that power is given; and therefore Congress may, in virtue of their sovereign power, create incorporations for attaining the ends or objects of those powers.

This argument is founded on what the logicians call petitio principii, or begging the question. The proposition, that the Government is sovereign, is assumed, to prove that it possesses the attributes of sovereignty: or, in other words, the fact of sovereignty is assumed, to prove that sovereignty. If the position that the powers of this Government are sovereign as to all the objects of them, be proved, I will concede the consequence, to wit: that we have a right to establish corporations to attain these objects—but I deny the fact of sovereignty. The acts of Congress, it is said, are declared by the constitution to be the supreme law of the land: and the power which can make the supreme law of the land, is necessarily a sovereign power. But I deny that this is a correct definition, or exposition of sovereignty. It is not the high nature of an act, nor the authority of the act, that stamps the character of sovereignty on him who performs it. The sheriff of a county who puts a man to death, under the sentence of the law, executes an act of as high import and authority as human power can execute; and yet the sheriff of a county is not therefore a sovereign. His authority is a mere delegated authority—his act is a mere ministerial, mechanical act. The idea of sovereignty imports the exercise of discretion—of judgment—of will. It is of the very essence of sovereign power, that you may execute that power, or not execute it—that you may execute it when you will, and how you will. A sovereign power, as to any object, includes a right to any means, and all the means applicable to the attainment of the object. But, sir, do Congress possess sovereign powers, or, what is the same thing, discretionary means, as to the attainment of the objects of this Government? No, sir. The constitution is not a general authority to Congress to attain the objects for which the Government was established; but it is an enumeration of the particular powers, or means, by which, and by which only, certain objects are to be accomplished. If the powers of Congress were sovereign, they would of necessity comprehend all the means applicable to the attainment of their objects; but inasmuch as they are specific and circumscribed, that very circumstance proves that they are not sovereign. The people of the United States are the true sovereigns of this country. From them all power emanates, and on their will all the authority of this Government depends. The powers of the Federal Government are mere delegated chartered authorities; and in the exercise of them we are tied down to the letter of the constitution. We have, to be sure, a certain latitude of discretion allowed us, within the letter and pale of the constitution; and so far we may be said to possess a sort of limited qualified sovereignty. But the constitution is the standard by which to measure the quantum and extent of our sovereignty. And our sovereignty, which is the result of the powers given in the constitution, is not the standard by which to measure the constitution. The constitution is the true bed of Procrustes—and our sovereignty, however unwillingly we may yield it, must be the victim.

Another argument, which is rather an argument to the favor than to the right of this bank, is, that it is an innocent institution; that, although its erection involves the exercise of legislative powers within the States, it does not abridge or affect the rights of the citizens, as secured to them by the laws of those States. A corporation, it is said, is a fiction of the law, a mere political transformation of a number of individuals from their natural into an artificial character, for the purpose of enabling them to do business to better advantage, and on a more extended scale; but, that when this political association, this legal entity, is once formed, it becomes subject to the laws of the State in which it happens to be placed.

I know, sir, that there is nothing formidable in the abstract idea of a corporation. It is a mere phantom of the imagination, invisible, intangible, and, of course, innocent. But, sir, when the legal effects of this incorporation are to invest the individuals whom it associates with privileges and immunities to which they were not before entitled; when this legal fiction is interposed to shield certain individuals from the liabilities to which they would be subject as ordinary citizens, it then becomes a matter of important and serious consequence. What are some of the legal effects of this incorporation?

One of its most obvious and distinguished characteristics is, that it exempts the private property and persons of the stockholders from all liability for the payment of the debts of the company. By the laws of every State in the Union, every man is, I believe, liable for the payment of his debts, to the full amount of his private fortune; and, in case that fortune prove insufficient, his personal liberty is at the disposal of his creditor; at least to a certain extent. Is not, then, the exemption from these liabilities an important immunity? Is it not an exclusive privilege secured to the stockholders of this bank? Assuredly it is. I know it has been said that a number of individuals may, by a private association, secure to themselves all the advantages of an incorporated company; that, by forming a common fund or stock upon which to do business, and issuing notes chargeable upon that fund, they may exonerate their persons and private property from all liability for the payment of the debts contracted in that business. I am no lawyer, sir; but if the law be what it is said to be, and what I believe it to be, summa ratio, then I pronounce this doctrine not to be law; for nothing can be more preposterous in principle than to say, that a man may, by his own act, avoid the force of an obligation which the law has made universal and unqualified. If a man owes a debt, acknowledges he owes it, and has received a consideration for it, the law has prescribed the nature and extent of his liability to pay it; and it is not for him to say that it shall only be paid out of a certain fund, or particular part of his property, and no other. When men contract a debt jointly, the legal obligation to pay it extends as well to the persons and separate property of the individual partners, as to their joint property.

Another feature of this incorporation is, that it authorizes the stockholders to take usurious interest for their money. By the provisions of the law, the bank may issue notes and make discounts to double the amount of their capital stock; and, in addition to that, to the amount of any moneys which may happen to be deposited in their vaults for safe-keeping; and this, too, independent of the debts created by these deposits. The bank, then, may, and in fact, in many instances, does draw an interest on three or four times its capital. Every State in the Union has laws regulating the rate of interest, and in most of the States this rate is fixed at six per cent. a year. By these laws it is made penal for a man to receive more than six per cent. interest for the use of any sum of money which, by a loan, he puts at hazard, and the use of which he deprives himself of. Now, sir, this bank is permitted, contrary to those laws, to draw an interest on twenty or thirty millions of dollars, when, in truth, the whole extent of its responsibility, the whole sum which it puts at hazard, and the use of which it foregoes, is only its original stock of ten millions. In answer to this, it will be said that an individual may, by issuing notes to an amount greater than his property, legally receive an interest on a capital which he does not possess. But it must be recollected, in case of the individual, that, although he may not at the particular time possess a property adequate to the payment of his debts, yet that all the property which he may subsequently acquire, will be liable for the payment of those debts; and what is more, sir, his personal liberty is always put in jeopardy. In this point of view, the liability and the hazard of the individual may fairly be said to be co-extensive with the whole amount of the capital on which he draws an interest; and which is often the case with the bank.

This bank incorporation possesses other qualities at war with the laws of the several States; one of which is, that it authorizes stockholders, who may be foreigners, to hold real estate. But, sir, I will not detain the committee any longer on this part of the argument, for this institution cannot be said to be innocent, as regards the rights of the States, when its effects on the rights of property are to exonerate the stockholders from some of the most important responsibilities which the laws of the several States have provided for the payment of debts; and when it authorizes the taking of usurious interest. I lay it down, then, as a position which cannot be controverted, that the granting of this charter is not only an interference with the municipal regulations of the several States in relation to the rights of property; but that it is an infraction of the rights of individuals as secured by those regulations.

But it is contended, that a right to incorporate a Bank of the United States is delegated to Congress by the constitution: and five or six different provisions of the constitution are referred to as giving this right. It is said that it is implied in the power to lay and collect taxes, in the power to borrow money, in the power to regulate trade and intercourse between the several States, in the power to provide for the general welfare, and in the power to make all needful rules and regulations respecting the territorial and other property of the United States. The very circumstance of referring this right to many different heads of authority is, in itself, conclusive evidence that it has no very direct relation to any of them. For it can scarcely be imagined, that the single act of incorporating a bank can be at the same time any thing like a direct execution of so many and such distinct and independent powers. But I will examine these provisions separately.