"The machine has thirty-nine brass wheels supported by two brass plates; seven arms, (the longest of which is 13 feet 9 inches) on the end of which are seven large glass globes, representing the seven primaries, surrounded by eighteen small glasses (all illuminated) | agent.

HAZARD'S

REGISTER OF PENNSYLVANIA.

DEVOTED TO THE PRESERVATION OF EVERY KIND OF USEFUL INFORMATION RESPECTING THE STATE.

VOL: IX.-NO. 22.

EDITED BY SAMUEL HAZARD.

PHILADELPHIA JUNE 2, 1832.

UNITED STATES BANK.

HOUSE OF REPRESENTATIVES.
MONDAY, May 14, 1832.

(Continued from page 231.)

NO. 231.

The exploration of the accounts of members of congress and officers of the government with the bank, came, in the opinion of the subscriber, under the same category as those of editors of newspapers. The reso-medium of the press, be attributed to the desire of havlutions of the House of Representatives authorized the examination by the committee of the books, only as evidences of the proceedings of the corporation.

The questions for the committee were: Had they violated the charter? Had they violated any law of the land? To these inquiries they were limited, and upon these alone could they with propriety report.

As an exemplification of the odious nature of further inquisitions, the subscriber would only mention the case of the members of congress, who, during the present session, have received the compensation for their public service from the branch bank at Washington in advance of the passage of the general appropriation act. This is one of the favours to members of congress, equivalent to a loan without interest to each member, of the amount of money which he thus receives from the time of his receiving it until the appropriation act shall have become a law. Its aggregate amount from the commencement of the session to this day, in payments to members of congress, and the executive officers, falls little short of four hundred thousand dollars. The amount of interest that would have accrued to the bank, had interest been paid by each individual member, would have exceeded $3,000. The subscriber himself is not without doubts of the propriety of this indulgence, and confidently avers that nothing which the investigation of the committee has discovered in the proceedings of the president and directors of the bank is of a more questionable character. The member who receives his pay in advance of the appropriation, does not indeed receive it in advance of the service which entitles him to it. But where is the law authorizing the bank to make the payment? The member who receives the money is only accessary to the payment by the bank, and there is many a member of this House, who, in voting for this investigation, little imagined that his own name would be returned among the members of congress, receivers of special favours from the bank. Many a member, who, perhaps, has received the favour without knowing it; yet is obnoxious in principle to the charge in the original resolution offered by the chairman of the committee, quite as obnoxious to the imputation of impure motives in the bank, as the bank can be made by all their transactions with editors of newspapers or printers, James Watson Webb and Mordecai M. Noah, included.

One great and insurmountable objection to the right and justice of entering into a scrutiny of motives for proceedings not forbidden by any law, was that the committee could exercise no censorial power of that nature over the president, directors, and officers of the bank, or, at all events, over individuals having dealings with that institution, which those individuals had not an equal right to exercise over the committee, and every one of its members in return. What motive, for examVOL. IX. 43

ple, could impel a member of the committee to call in exercise all the power of congress to suppress the publication of essays or speculations favourable to the bank in newspapers? Would not the editor of a newspaper thus inculpated have the same right to inquire into the motives of the committee-man? If, peradventure, he should have been in the habit of making free use of the press to assail and discredit the bank, would not this struggle to deprive the bank of self-defence through the ing the monopoly of that powerful engine to himself? Would it not argue a consciousness of weakness in the appeals to public opinion against the bank, if, to sustain the charges against it, there should be an attempt to suppress all the means of self-defence? The freedom of the press, in the language of party spirit, means the unlicensed use of that instrument for itself to assail, and a total interdiction of its use to the adversary for defence. And singular, indeed, would be the section of a charter to a bank which would leave it open to every shaft to slander, and deprive it of all possible means of repelling the assault.

Among the useless, and worse than useless inquisitions into which the majority of the committee thought themselves justified in descending, were imputations of political misconduct in certain officers of the branch bank at Norfolk, in Virginia. Articles of complaint, as grievous and perhaps as numerous as those of the chairman of this committee against the president and directors at Philadelphia, had been laid before that board against the president and cashier at Norfolk, by a person who had been one of the directors of that branch. A long and patient investigation of those charges had been made by the board at Philadelphia, and one of their cashiers had been sent to make a thorough examination of all the facts of the case upon the spot itself. The charges had been found totally destitute of foundation, and there was among the archives of the bank a volu minous correspondence, which was all submitted to the examination of the committee. To give the house a faint idea of the extent of this inquiry, it may be sufficient to say that the whole controversy respecting the accounts of a late navy agent at Norfolk, and the pamphleteering and newspaper war between that officer and one of the auditors of the treasury, were among the simplest of its elements. After plunging for a series of days into these mysteries, almost deep enough for every member of the committee to take his side upon two or three by-gone contested elections at Norfolk, after plodding over manuscript volumes of acrimonious bitterness from the most pertinacious of complainants; after examining the long protracted correspondence both of that complainant and of the inculpated officers of the Norfolk branch, with the board at Philadelphia, and the cashier who had made the investigation at Norfolk; af, ter giving the complainant himself the trouble of repairing to Philadelphia to sustain his charges, and try over again criminations and recriminations, which a judicial tribunal, after summoning half the inhabitants of the borough of Norfolk, and subjecting them to an endless list of interrogatories and cross-examinations, would scarcely have been competent to solve-after the consumption of several days in these inquiries, the last result of which, must, under any possible termination of their

investigation have left them precisely where they began, the majority of the committee concluded to desist from what the subscriber believed the committee ought never to have undertaken, and what the chairman reports "they have been compelled to abandon for want of time."

The complaints made against the president of the bank of Portsmouth, New Hampshire, in the summer of 1829, and the correspondence between the board at Philadelphia, and the late secretaries of the treasury and of war, form a portion of the documents relating to the books and proceedings of the bank, called for by the committee, and communicated to them. They are not noticed in the report of the chairman, but, in the opinion of the subscriber, are more deserving of the attention of congress and of the nation, than any other part of the papers commented upon in the report. An effort very thinly veiled on the part of two of the executive departments of the general government to exercise a control, political and pecuniary, over the proceedings of the bank and its branches, a control highly exceptionable in principle, and even contrary to law, appears to him to be fully disclosed in those papers. He will not permit himself to inquire into the motives of the agents in those transactions. It is sufficient for the protection of the public interest that the projected encroachments of power were disconcerted and laid aside.

form no distinctive opinion. He has never had access to the greater part of them. They were called for by resolutions submitted by the chairman and one or two other members of the committee, without disclosing the objects which it was expected they would elucidate. Most of the time, while the committee were at Philadelphia, was consumed in the compilation of them by the officers of the bank. When collected, they remained in the possession of the chairman of the committee to enable him to prepare his report, and the subscriber has not even seen a considerable portion of them. He will con fine himself, therefore, to those which have been noticed in the report of the chairman and majority of the committee.

1. The charge of usury, as having been taken some ten years since by the branch bank, at Lexington, as set forth in the case of the Corporation against Owens, and others, reported in the second volume of Peters's Reports of cases argued and adjudged in the Supreme Court of the United States, was one of those upon which the chairman of the committee had largely expatiated in his speeches, at the time when he brought forward his resolution of investigation. No information varying the state of the facts as they were then explained, was obtained by the committee. It was then sufficiently shown, that in all the transactions of this case there had been neither usury, nor any thing resembling usury, on the part of the bank. That it was a case in which the bank had not done, but had suffered grievous wrong. A transaction in which the subscriber has no hesitation in saying, that if the parties had been on both sides individuals, the plea upon which the defendants extricated themselves from the engagements which they had contracted, would have been in no wise creditable to them.

The bank had discounted a promissory note of Owens for five thousand dollars, upon which the other defendants were joint signers with him.

Among the objects of investigation authorized by the majority of the committee transcending, in the opinion of the subscriber, the powers delegated to them by the resolution of the House, and therefore unwarranted and improper, were six sets of interrogatories, amounting in all to one hundred and sixty-one questions, addressed by one member of the committee to the president of the bank, never submitted to the committee for their consideration, but drawn up, a large portion of them, after the committee had closed their examinations at Philadelphia, and after the subscriber had returned to Washington, and resumed his seat in the house. They re- For this note Owens received the sum of 5,000 dolminded him of certain popular words of instruction for lars in notes of the Bank of Kentucky, promising to pay children, in which universal or particular histories, or the same sum in specie in three years from the date of abstruse and profound sciences are taught by question the note. At that time, the notes of the Bank of Kenand answer. The subscriber has found many of them, tucky were depreciated, and purchasable in market, at upon perusal, passing his powers of comprehension, but a discount of 54 per cent. Owens received them at they appear to comprise a compendium of political eco- their nominal value, and promised payment for them in nomy, and the skeleton of a profound dissertation upon specie three years after date. The notes had been recoins, currency, paper credit, circulation, and banking.ceived by the Lexington branch, at their nominal value, The subscriber cannot withhold his admiration from the and partly for government deposites. To them, they comprehensive views and profound knowledge of the were equivalent to specie. Within six months after the subject discovered in those inquiries, and believes that transaction, they recovered their nominal value. Had satisfactory answers to them might form a very useful the Lexington branch retained them, they would have second, though somewhat larger volume, to the legisla- been repaid at their full value, with lawful interest, till tive and documentary history of the Bank of the United the time of payment. They never received one dollar States, compiled by the indefatigable research and in- of usurious interest upon them-never one dollar more dustry of the clerk of the house of representatives and than was actually paid to the holder of them by the his associate. But a large portion of the questions might, Bank of Kentucky, from which they had issued. The with more propriety, be addressed in a circular to the money was equivalent to specie to Owens himself, at presidents of all the banks in the four quarters of the the time when he received it, and he paid with it debts globe, than to the president of the Bank of the United of his own at their nominal value. States. And it may be doubted whether of many of the inquiries, a convention of all the bankers in the world would not be reduced to the necessity of leaving them as they found them-to be solved only by the ingenuity or sagacity of their author. The subscriber objected to them as they were presented in clusters; not but that some of the questions might be within the compass of the powers and duties of the committee, but that they were buried in such a mass of heterogeneous matter, that it would have occupied the committee to the last moment of their happily limited time to extract the pertinent matter from its encasement. The subscriber believed it quite unjustifiable, under the authority of the committee, to make of this inquiry a general disputation upon banking.

Upon the mass of documents and tabular statements collected by the committee, and reported to the House, the subscriber has so imperfect a knowledge that he can

But the branch at Lexington, in the case before the court, was, as many a suiter besides has been, made the victim of a special plea and demurrer. The plea set up by the defendants to escape the payment of an honest debt, set forth, not that the notes of the Kentucky Bank were of less value than specie, to the branch at Lexington, the loaner,-not that they were of less value than specie to Owens, the borrower and receiver; not that at the time when the note was made payable, they were of less value than specie even in the open market, but, that at the time when the note of Owens was discounted, the notes of the Kentucky Bank were GENERALLY DEPRECIATED

so that 100 dollars thereof nominally were of the CUBRENT VALUE of only 54 dollars. To this plea of general depreciation, and current value, there was, perhaps incautiously, what the lawyers call a demurrer on the part of the bank, which demurrer, according to the practice of judicial courts, precludes the party from the benefit

of

1832.1

any

UNITED STATES BANK.

with more respectful deference. But in the review of
judicial decisions upon contracts avoided by pleas of
usury or statutes of limitation, there would be always
found a "considerable dearth of authorities" in the
English Reporters, traced back even to the age of
Elizabeth, in which the fiat of the law has been in
unison with the dictate of justice.

In one of the precedents cited by judge Johnson, the
court is said to have observed "there is nothing immo-
ral in this transaction, but it is against a prohibitory sta-
This remark was not wholly applicable to the
tute."
Of that transaction it could not be said
case of the bank of the United States against Owens
and others.
there was nothing in it immoral. There was something
in it profoundly immoral, though not on the part of the
Even the violation of the prohibitory statute
bank.
was an inference against the fact, from the confession
implied in a demurrer. The bank was first debarred
from the recovery of a just debt, and then branded
with usury upon the plea of general depreciation and
current value of the notes of the bank of Kentucky,
when in fact there was not a cent of usury taken or
even reserved.

other facts than those specially set forth in the plea. Special pleading has long been known among the practitioners of the law, as the science of spreading snares for the unwary; and so odious has it become from the frequency with which it is thereby made to operate unjustly, that in many states of this Union, legislative acts have abolished it altogether, by providing that in all cases whatever a defendant shall be at liberty to take the general issue, and give all special matter in evidence under it. In this case, however, the general issue did not suit the purposes of the defendants. They could not aver that they had not made the promise to pay the money for which they were sued by the bank. They could not deny that the Kentucky bank notes had been to the borrower and to the lenders equivalent to so much silver. They could not deny that long before the note became payable, the Kentucky bank notes had recovered their full value. Owens himself had not the face to join in the plea, but the joint signers of his note, finding it more convenient to charge the bank with usury, than to fulfil their engagements, screened themselves from performance by this plea of The subscriber, however, cannot suppress his surgeneral depreciation, and current value, and by averring in their special plea, contrary to the fact, that there had Not alone, been a corrupt and unlawful agreement between the prise that this case should have been selected and bank and themselves, that the bank should receive more should now be persisted in, as the head and front of the than lawful interest upon the loan to Owens. It was offences of the Bank of the United States. no such thing. There had been no such corrupt agree- because, upon a thorough examination of the facts, as ment; but the bank, by demurring to the plea, deprived they appear upon the face of the report, it is the settled. itself of the means of disproving that allegation, and conviction of his mind that, throughout the whole of this upon that state of things, the decision of the case, by a transaction, the bank was the innocent and deeply inbare and doubting majority of the judges of the Su-jured party-not alone, because he deems it would be preme Court, was against the bank. With the utmost the summit of injustice to hold the bank of the United deference for the opinions of that court, the subscriber States responsible in its charter for an unlucky demurrer pleaded seven years ago, in a suit brought by the believes that they never gave a judgment of less aubranch at Lexington, against delinquent debtors. But thority than in this identical case. The judges of the Circuit Court for the district of because, setting aside all those considerations, and suppo The sing even the president and directors of the parent bank Kentucky had differed in opinion upon judgment of the Supreme Court was delivered by judge culpable of all the mistakes in pleading of the branch Johnson, who declared himself to have entertained very at Lexington, this transaction is of ten years standing. serious doubts of the sufficiency of the averments in the If usury there were, it was the usury not of Nicholas plea. After stating those doubts, he adds "I am con- Biddle and the directors of 1832, but of Langdon From the endorsement tent, however, to unite with the three of my brethren, Cheves and the directors of 1822. The contract was who make up the majority on this point, in holding the made in May of that year. averments to be sufficient, because in a considerable upon the note then made by an illustrious citizen of dearth of authorities on this subject, I find it decided Kentucky, and one of the most distinguished lawyers of in the case of Bolton vs. Durham, in Croke's Report, the Union, (Mr. Clay,) it is clear that there was noCro. Eliz. 642, that the confession of the quo animo im- thing, in his opinion, in the transaction which could It was undoubtedly plied in a demurrer will affect a case with usury, when expose it to the charge of usury. The subscriber sees a very similar case in the same book, in which the plain-nothing in it of that nature now. tiff had traversed the plea, was left to the jury with a considered in the same light by the then president of favourable charge. Benningfield vs. Ashley, Cro. Eliz. the bank, Mr. Cheves, to whose opinions upon other 741. Here then judge Johnson declares that after points regarding the administration of the affairs of the very serious doubts he was content to unite with his bank, so much deference is shown in the report of the three brothers, to make up a majority against the bank, majority of the committee, that the subscriber thinks because he found in an old Reporter of the time of he might well have been spared this imputation of being Queen Elizabeth that the confession of the quo animo, accessary to an usurious contract of the branch at Lex(that is of the alleged but fictitious corrupt agreement) ington, and of having permitted it to be consummated The next charge upon which the majority of the implied in a demurrer, made that usury, which by the without censure or animadversion. authority of the very same book would not have been usury, if the plaintiff had traversed the plea, that is, had committee have deemed it within their competency to denied and tendered in issue the pretended corrupt report, is that relating to the issuing of the branch agreement. If, then, the branch at Lexington, instead drafts or notes. Upon this subject there was nothing Their existence, the causes in which they of demurring, had traversed the plea of the defendants, of any moment for the investigation of the committee to that is, if they had denied the existence of the corrupt discover. agreement, averred by the defendant, but which had originated, and the purposes which they were intended They had never existed, the Supreme Court would have decided to answer, had all been disclosed upon returns already that there was no usury in the case, and the defendants made by the president of the bank to inquiries institutwould have been compelled to perform their lawful en-ed by this and the other house of congress. gagement, instead of evading it by stigmatizing them-been issued, not hastily, but after deliberate advisement selves with corruption.

the case.

The subscriber will pursue no further this analysis of
the decision of a majority of the judges of the Supreme
In cases where that ven-
Court of the United States.
erable tribunal is at liberty to harmonize in judgment
with the award of moral sensibility, there is none to
whose discernment and discrimination he would bow

with regard to their legality, sanctioned by the written opinions of three of the most eminent counsel, learned in the law, in the United States. All the facts leading to a just estimate of their expediency were well known. They were substituted for small notes, signed by the president and cashier of the parent bank, of which it was impossible for them to supply sufficient numbers

for the necessary circulation of the country. The report of the majority of the committee states, much in detail, the repeated and earnest applications of the president and directors of the bank, to congress for an additional authority to the presidents and cashiers of the several branches, to sign the notes issued by those branches. It does not appear that this request was ever denied by congress, after deliberation. In one instance, at least, there was a report of a select committee of the house of representatives, in favor of the appointment of signers to the notes of the bank; but the spirit which, in the halls of legislative power, so often defeat by procrastination, that which it cannot reasonably reject, had always succeeded in arresting the action of congress upon this proposal. But the power which was adequate to withhold the means of furnishing, in this form, uniform currency for circulation, could neither supply its place, nor suppress the constantly recurring want of it, in the intercourse of business between the different parts of the country. The solicited power was never denied, but it was never granted; and the omission to grant it had the effect of denial.

coin, shall be seven or eight per cent. higher than the relative value assigned to them by statute, while both shall be legal tenders; so long as Spanish or Mexican dollars shall contain more pure silver than the coinage of our own mint, so long will the coin of highest intrinsic value be bought and sold as commodities, in spite of all human legislation. Nothing is more clearly established by the universal experience of mankind, than the impotence of despotism itself, to control the value of the precious me tals. Every attempt to exercise such authority bears upon its face the stamp of injustice. Charles XII. of Sweden,once transmitted a message to the senate of the kingdom, that he would send to govern them one of his boots. The same monarch successively issued eight or ten copper counters, each about the weight of half a cent, and decreed that they should pass for Swedish silver dollars. His own creditors were compelled to receive them; but to pass them off upon others at the same rate was beyond his power.

With two metallic legal tenders of different intrinsic value, the bank, like every other corporation or individual,has the option, and always will make the option, The want of circulating currency, equivalent to spe- to pay in the tender of lowest value. Their debtors cie, continued with increasing pressure upon the peo- having the same option will, as universally, pay the corple, and especially at the locations of the southern and poration in the same tender of lowest value. To forbid western branches of the bank. An expedient was at the bank from receiving foreign silver or domestic gold last resorted to, which, without transcending the limits coins at an advance, would be to expel them, unless as of the charter, effected the same purposes which would special deposites, forever from their vaults. To forbid have been accomplished by notes payable to the branch- the bank from paying them at an advance, would be es, under the signatures of their presidents and cashiers. a prohibition ever to issue them at all. They are comIt was, that they should be authorized by the direct-modities in the market which will be bought and sold, ors of the parent bank to draw notes or drafts upon the by all the brokers and state banks in the Union, whebank, payable only there. That this expedient was ther bought and sold by the Bank of the United States warranted by law,has been settled by a solemn decision or not. The participation of the bank in the traffic, far in the Circuit Court of the United States. It had pre- from tending to disturb the legal value of the coin, viously received the sanction of the secretary of the and render that portion of the metallic curreucy uncer. treasury. An obvious remark upon it is, that its suc- tain and fluctuating, has a tendency directly the recess depended upon the extensiveness and universality verse. To prohibit the bank from making an allowof the credit of the bank. The drafts, though payable ance of advance upon Spanish dollars, would be a proonly at the bank in Philadelphia, circulated as specie inhibition to import specie, consisting of that coin, at all. every part of the country. But for that credit they could not have circulated at all, or only as depreciated currency. They have answered an exceeding useful purpose, and proved a great public convenience in the transaction of business, and the circulation of exchanges throughout the Union. Under management always prudent and cautious, no serious inconvenience would be anticipated from them. But it is not to be disguised, that they offer facilities and temptations for improvident and excessive issues. The bill reported by the In this, as in many other parts of the report, the subcommittee of ways and means, for re-chartering the scriber has had occasion to regret the want of precision Bank of the United States, proposes to prohibit the is in the statement of the charge. Here almost every suing of these branch drafts, but to authorize the pre-word in which the charge is conveyed is remarkable sidents and cashiers of the branches to sign bills payable at their respective offices only. The want of a circulating currency will not be so effectually supplied by this process, as by that now in use; but it will be more invariably safe to the bank itself. It is understood to be more acceptable to the president and directors, and the subscriber is willing that it should be substituted for the practice now established, from which, however, he perceives not that any serious public injury has yet resulted. That it is justifiable under the charter, he has no doubt.

The next charge adopted by the majority of the.committee, from the bill of indictment of the chairman, is, that the president and directors of the bank have been guilty of the crime of receiving and paying Spanish dollars, and even our own gold coins at their intrinsic value, which is higher than that conferred upon them by statute. The objection is, that these are not technically called bullion; and there seems to be an argument in the report, that to give or receive more for foreign coin, or for domestic coined gold, than their value, as established by law, is unlawful. This argument, the subscriber, believes, has the merit of novelty-to him at least it is new. So long as the proportional value in the market of gold to silver, whether bullion or

Then, either it would be imported to the same extent by other institutions and individual traders, or there would be a deficiency in the supply of specie. In the former case the fluctuation in the value of that kind of specie would be neither more nor less than it is, and in the latter, it would be much greater.

The fourth charge reported by the majority of the committee, is that of selling "stock obtained from government, under special acts of congress."

for its looseness and indefiniteness of meaning. Who, for example, under the denomination of "stock obtained from Government," would naturally understand the evidences of a loan made to the Government by the Bank itself? In the contract of a loan there must be a debtor and a creditor, neither of whom can with propriety be said to obtain any thing from the other. In the use of ambiguous language, there is always danger of ambiguity of conception. In this case, if the Bank obtained stock from the government, it was because the government obtained money from the bank. The loans could not have been made without special authority by act of congress, and that authority was expressly given. The bank is prohibited from purchasing any public debt whatsoever; but it is not prohibited from selling any certificate of public debt which it may lawfully possess. With regard to the loans to which the report of the majority of the committee refers, the stock which represented the moneys borrowed, was made transferable by the very acts of Congress which authorized the loans. The bank received the certificates transferable upon their face, and neither that act, nor the charter of the bank, nor any other law of the land prohibited the bank from selling them.