Chapter 37

One more argument in favour of a fair, liberal, manly construction of the constitution. There would be a certain degree of inconvenience incident to every written constitution, if there were no difficulties in its interpretation, and its language was always understood in the same sense by all men. In making that distribution of its various powers which is deemed most likely to secure a safe and healthy action, the hands of its functionaries must often be tied up from doing that which particular circumstances may make highly expedient. Some imperative claim of humanity, some yet more pressing emergency of state, may call for powers which the constitution has withheld. Mr. Jefferson considered the acquisition of Louisiana to be a case of that character. He questioned the power of acquiring foreign territory under the constitution. But when he reflected that France could not retain possession of Louisiana, and that hither the constitution must be stretched, (his letter to W. C. Nicholas might almost justify a stronger expression,) or we must submit to having the greatest commercial nation in Europe--our most active rival in peace, our most powerful enemy in war--posted on our right and left flank, and, by and by, in our rear,--he sacrificed his opinions to the safety of the republic. The present president was no doubt actuated by similar considerations, when he pursued the Seminoles into the Spanish territory, and made war on the country in which they had taken refuge--the occasion not appearing to him to admit of the delay of a formal declaration by congress. Commodore Porter may be presumed to have acted on the same principle in Cuba. No one regards these as fit cases for precedents. All agree, that if we have a constitution, its mandates should be obeyed, and that we must be content to put up with its partial inconvenience, for the sake of its general benefits. But surely we ought not to go to the other extreme, and so fetter the constituted authorities of the nation, by a spirit of interpretation which will deprive them of all salutary power, except by usurping it. Let us not lose sight of "the expedient," in discussing "the right;" but rather, as the common sense of mankind dictates in ordinary cases of conscience or morality, be liberal in construing the constitution, when its power is to be used for the good of the people, and captious and astute only when its exercise may be pernicious.

On these grounds, we earnestly beseech those who are friendly to our political institutions--who believe that no other than the complex government we have adopted can unite the adaptation of laws to local circumstances with the strength and security of a great empire, to discountenance the pestilent and absurd doctrine that the constitution is to be on all points forever unsettled. We beseech them to save this monument of our country's wisdom--this instrument of its safety, its liberty, and its future greatness, from the peril and reproach to which it is thus exposed. It is in their power to protect it from an evil which would convert a government intended to secure domestic peace, into one of perpetual civil strife, and which would confide the destinies of the country to sophists, and quibblers, and casuists--or rather to those political managers who would use them as tools to persuade the people that a good measure was unconstitutional, that they might pursue a bad one with impunity.

2. The next objection is, that the bank possesses a "formidable" influence on the community. It must be admitted, that this complaint of bank influence is not now brought forward for the first time. It was a favourite theme of the demagogue, from the time the first Bank of the United States was established, until its charter expired, when it appeared that its influence was not equal to its own preservation.

If, indeed, no other corporation had the right to issue notes of circulation, then the power of enlarging or contracting the common currency at pleasure would be a very great one--greater than ought to be put into the hands of any others than persons chosen by the people, or their representatives, and responsible to them. But as the bank and its offices are every where surrounded by competitors, some of which have a yet larger capital than themselves, they have no such exclusive control over the amount of money in circulation, and their influence, whatever it may be, can be exerted only as to its quality. It is precisely on this last influence that the friends of the bank mainly rely for the public favour.

Let us inquire a little further into the extent of the bank's influence. The principal functions of this institution, except the services it renders the government, consist in discounting promissory notes, selling or buying bills of exchange, and receiving deposits of coin, or of its own notes, for safe keeping. It has no exclusive privilege of doing either of these acts, as every state bank may do, and actually does the same. But by means of its superior capital, and consequently its superior credit and resources, it can, in some of its operations, either undersell the other banks, or command a preference in the market;--aye, there's the rub. The banks in some of the large cities have persuaded themselves that if this "formidable" rival was out of the way, they would be able to buy and sell more bills, and upon better terms than at present. But if this consideration should make them an object of dread and dislike to the state banks, it should also recommend them to the favour of the public. Their notes, too, are generally preferred by travellers, and for distant remittances. But neither does this fact furnish any ground of dread to the community, whatever it may to their rivals.

It thus appears that they have the same advantage over other banks, which one tradesman or mechanic occasionally has over others of the same calling. He who does his work best, and sells it cheapest, will always get the most and best custom; and it would be just as reasonable for his rivals in business to complain of his making better wares, of being more accommodating, and of underselling them, as for the other banks to complain of the Bank of the United States. It is clear, that if the rival banks are losers, the public is a gainer, unless they can succeed in persuading the people, that competition, which is so salutary and beneficial to the public in every other business, should be mischievous only in this. The argument thus used against the Bank of the United States, is precisely that which might have been used, and, we presume, was used, by the owners of the Albany sloops against steam-boats; and which might be used against canals and rail-roads, by those who would find employment for their wagons in the former more expensive modes of conveyance.

But by an influence which is supposed to be so "formidable," is meant, perhaps, a political and corrupt influence. If there be such a one, it must be seen and felt; and we would ask in what way does it exert itself? Does the bank use its money in the elections? If so, its accounts must show it; and as there are men of all parties who own, or may own, shares in the stock, let those who suspect this abuse scrutinize those accounts for the purpose of detecting it. But those who manage the banks, know very well, and so do those who accuse them, that nine-tenths, or rather ninety-nine hundredths of the stockholders, would not have given a five dollar note to get the president elected, or to get him turned out. Your office-seekers, indeed, might pay pretty liberally for such service, but they are seldom stockholders. These are, for the most part, thrifty, cautious men, who choose to vest their money in some fund which gives them regular returns; and they are content that they shall be small, provided they be certain. The rest are widows, guardians of orphan children, trustees of public institutions, and merchants who have more capital than they can safely and profitably employ. Now, who of these would allow a president and directors to squander their money in a matter in which they felt little interest, and that probably a divided one. No body believes this, and yet it is not easy to say in what other mode they could exercise a corrupt influence.

But if the stockholders were disposed to spend their money in electioneering, can they be prevented from acting so foolishly by putting down the bank? If the charter is not renewed, their money will be returned to them, and they would then have both the power and the inducement to use it for political purposes, which they cannot have while it is supplying a currency to the country, and invigorating its industry and commerce. But, in truth, it is well known, that those persons do not make ducks and drakes of their money now, and are not likely to do it then.

It is true, that in case of an extraordinary demand for money, beyond the means of supply by the state banks, the Bank of the United States may sometimes prefer discounting the note of one man to that of another--the paper of A to that of B; and that some of the directors might have given the preference to A, because he was a neighbour--others by his being a friend or relative, and others again by mere party sympathies. But we believe that none of these things go very far at bank. The object of its directors being to make money, they prefer the paper of a rich man they hate, to that of a poor friend. Nor do they widely differ from the rest of the world in this particular. But granting that moral and political considerations do influence the bank in its loans, who does not see that they could have no effect, except when the supply of money for loan was not equal to the demand, and that the mischief would be increased by putting down the richest and most substantial bank in the country?

Upon the whole, this cry against the influence of the bank, resolves itself into that of wealth and property. These do exert a certain influence in the community on some occasions, and it is more than counteracted on others, by the jealousy and ill will it engenders. Whatever influence wealth may have, it is inseparable from our present condition, as we presume the United States are not yet prepared for the Agrarian system, and every man will be permitted to enjoy the fruits of his own industry, or that of his ancestors; but be it little or much, we cannot reasonably expect to see it exerted more harmlessly or more beneficially than in a solid, well managed bank. If, however, in spite of all these considerations, the power of these institutions be thought too great, and too liable to abuse, then there is no more effectual way of weakening it than by diffusion. As most of the state banks are more or less under the control of the state authorities, who may use the influence of these banks for political purposes, it must be desirable to all those who wish the public mind as free and unbiassed as possible, to see this influence weakened, if not neutralized; and there seems no more effectual mode of doing this than establishing a rival bank, over which the state politicians could exercise no sort of authority. Let us, for example, suppose that a system of banking was adopted for a state, by which, under the colour of guarding the public against their insolvency, those institutions were subjected to a _surveillance_ and control which were calculated to make them feel their dependence on the state government, and when the plan was matured, to make them obsequious to its will. Would not every friend to the political purity of the state, and the independent spirit of its citizens, wish to see a scheme of this character frustrated? and what means so conducive to this end as the Bank of the United States, which, in the first place, by bringing so much capital into the market for loans, lessens the influence of all banks, and, in the next, may perform its several functions without regard to the smiles or frowns of any politicians whatever.

This is probably the influence which is really objected to in the Bank of the United States, that of disenthralling the people from an utter dependence on the state banks for the various accommodations those institutions afford--an influence which it appears to us no true friend to his country should wish to see diminished, however inconvenient it may be to those who would make banks and every thing else subservient to their purposes.

3. But the Bank of the United States, it seems, must be brought into collision with the local authorities, and occasion perpetual apprehensions and discontent on the part of the states and the people. We know not upon what facts the president or his advisers have made this statement. It is in direct contradiction to that made by the committee of ways and means, who say--

"It is due to the persons, who for the last ten years, have been concerned in the administration of the bank, to state, that they have performed the delicate and difficult trust committed to them, in such a manner as, at the same time, to accomplish the great national ends for which it was established, and promote the permanent interest of the stockholders, with the least practicable pressure upon the local banks. As far as the committee are enabled to form an opinion, from careful inquiry, the bank has been liberal and indulgent in its dealings with these institutions, and, with scarcely an exception, now stands in the most amicable relation to them. Some of those institutions have borne the most disinterested and unequivocal testimony in favour of the bank.

"It is but strict justice also to remark, that the direction of the mother bank appears to have abstained, with scrupulous care, from bringing the power and influence of the bank to bear upon political questions, and to have selected, for the direction of the various branches, business men in no way connected with party politics. The Committee advert to this part of the conduct of the directors, not only with a view to its commendation, but for the purpose of expressing their strong and decided conviction that the usefulness and stability of such an institution will materially depend upon a steady and undeviating adherence to the policy of excluding party politics and political partisans from all participation in its management. It is gratifying to conclude this branch of the subject by stating, that the affairs of the present bank, under the able, efficient, and faithful guidance of its two last presidents and their associates, have been brought from a state of great embarrassment into a condition of the highest prosperity. Having succeeded in restoring the paper of the local banks to a sound state, its resources are now such as to justify the directors in extending the issue and circulation of this paper so as to satisfy the wants of the community, both as it regards bank accommodations and a circulating medium."

The committee, coming immediately from the people, are somewhat more likely to have accurate information on this subject than the president. We have heard of no recent collisions between any state and the bank; and those which formerly took place with the states of Ohio and Maryland, respectively, have been long since settled in the Supreme Court. The people of Tennessee, too, once objected, through their representatives, to the location of a branch bank in that state; but a subsequent legislature, believing that they better understood the interests or wishes of their constituents, withdrew their opposition, and the branch bank which was therefore established, is now in successful operation. The legislature of Mississippi, in like manner, has, within a few months, repealed a hostile act passed two years ago, and invited the establishment of a branch. The executive council of Florida, has recently requested a branch, and we understand that there are numerous applications for branches from all parts of the Western and Southern states. Surely the people of these and the neighbouring states cannot seriously object, that a portion of the moneyed capital which has been accumulated in the Atlantic states should be brought among them, to encourage their industry and facilitate their trade--to enable their own merchants to give them ready money, and a somewhat higher price for their cotton--to furnish one man with the means of building a mill--another a manufactory--and a third a steam-boat. We cannot believe that they are such novices in political economy. If their citizens do not want the money, they need not borrow it; and if they do, it is better to find it at home, than to be dependant on New-York, Philadelphia, or Boston, for it. In the state of Alabama, if we are to believe the public prints, the United States Bank there has afforded great and most seasonable aid to the state bank. Nor do we know of a single state, in which there are any manifestations of popular discontent with the bank, notwithstanding the pains taken by some of the friends of the president to excite them.

Perhaps the apprehensions mentioned in the message may refer to the state banks rather than the people; and the president has presumed, that, as some of the states are interested in the stock of these institutions, and as their interests may conflict with those of the Bank of the United States, the people would be likely to side with their own institutions. The presumption is far from being unfounded. The sympathies of the people will always be with the states, rather than the general government, when the two are in conflict--a fact of which politicians are sufficiently apt to avail themselves. Thus, when the present Bank of the United States first went into operation, fears were entertained by the state banks and their friends, that the United States Bank and its branches would prove troublesome and dangerous neighbours. Their strength to oppress, and even crush, a rival, was supposed to be in proportion to their capital; and, comparing them with things with which they had no sort of analogy, it was argued, that a state bank, in the neighbourhood of a branch of the national bank, would be not more likely to thrive, than a delicate shrub under the shade of a spreading oak, or to find safety, than a light armed brig under the battery of a seventy-four. These arguments prevailed for a season in some of the states; but at length the experiment was made, in spite of these gloomy predictions, and it was found, as well it might be, that a small capital, _if prudently managed_, is as independent of the attacks of a rival, in banking, as in any other business. And why should there be a difference? A tailor or shoemaker who employs but two or three journeymen, may do as safe, though not so profitable a business, as he who employs twenty or thirty--in the same way as a small vessel may navigate the ocean as safely as a large one, and may be even less likely to overset in a storm, if it carry less sail in proportion to its ballast.

We do not mean to deny, that a bank with a superior capital, if it were disposed to injure a rival at all hazards, might prove an inconvenient neighbour, and greatly curtail its business. If it were to put itself to the trouble of procuring the paper of the other, as soon as it was issued, and convert it immediately into specie, the loans of that other might be restricted to the amount of its specie capital. But this could not be effected without a degree of trouble and expense which would make it impracticable. What means does such a bank possess of drawing in the paper of the other bank, except so far as the debtors of the one institution chance to be the debtors of the other, or it choose to give a premium for the notes of its rival? It is not likely, that the same individuals would be the debtors to both banks, to a great extent; and as to a premium, such sacrifices seldom take place in individual competition, much less in that of banks. Besides, as soon as the bank which was thus assailed found that a premium was given for its paper, it would issue notes for the purpose of obtaining it, and the faster its notes were bought up and returned for specie, the more would be found in the market--a new swarm being attracted by the premium as soon as the first disappeared--until in a few months its hostile rival would share the fate of those who attempt to break another sort of banks--its own coffers would be exhausted.

The means then which a bank possesses of narrowing the sphere of circulation of a rival's paper, are much more limited than is commonly imagined; and such as they are, it will be cautious of exerting, lest the same game should be played on itself. A combination of the state banks, or even a single one of respectable capital, may practise the same means of annoyance against a Bank of the United States, as that could put in operation against them. But if both parties were wise, or rather not utterly foolish, they would each pursue their own business; and one not otherwise interfere with the other, than by occasionally exchanging notes, and receiving the difference in specie. This course might indeed prove a check to extravagant issues by either, but it is precisely that check which the public is interested in maintaining.

There is a further security against the wanton and bootless mischief which fear or design has imputed to the Bank of the United States. Public opinion would cry out against its illiberal course, and would fully avenge the wrong. Some of their best customers would desert them. They would lose most of their deposits. Their notes would be industriously collected and prematurely returned to them, and they would thus not only lessen their present profits, but furnish their enemies with arguments against the renewal of their charter. The supposition of such a course presumes the bank to be utterly regardless of their own interests, as well as of all sense of fairness and liberality--considerations which still have some weight with some men--and it is at variance with all that we have ever heard of the officers of that institution. As a proof that no fears or jealousies against the Bank of the United States are entertained by safe and substantial banks, we may remind our readers, that Mr. Girard, the greatest banker we have, was one of the most efficient supporters of the present national bank. No other individual in the United States would be so much affected as he, if its competition and neighbourhood were pernicious, and yet no one subscribed so largely to its stock, and no one, we have reason to believe, deplores more strongly the confusion in the moneyed concerns of the country, which he thinks would be inevitable on the destruction of the bank.