656. BANK (National 1813), Considerations on.—
The advantages and disadvantages
shall be noted promiscuously as they
occur; leaving out the speculation of canals
&c., which, being an episode only in the
scheme, may be omitted, to disentangle it as
much as we can. 1. Congress are to receive
five millions from the States (if they will enter
into this partnership, which few probably
will), and five millions from the individual
subscribers, in exchange for ten millions of
six per cent. stock, one per cent. of which,
however, they will make on their ten millions
of stock remaining in bank, and so reduce it,
in effect, to a loan of ten millions at five per
cent. interest. This is good; but, 2. They authorize
this bank to throw into circulation
ninety millions of dollars (three times the
capital), which increases our circulating medium
fifty per cent.; depreciates proportionably
the present value of a dollar, and raises
the price of all future purchases in the same
proportion. 3. This loan of ten millions at
five per cent., is to be once for all, only.
Neither the terms of the scheme, nor their
own prudence could ever permit them to
add to the circulation in the same, or any
other way, for the supplies of the succeeding
years of the war. These succeeding years
then are to be left unprovided for, and the
means of doing it in a great measure precluded.
4. The individual subscribers, on
paying their own five millions of cash to Congress,
become the depositors of ten millions
of stock belonging to Congress, five millions
belonging to the States, and five millions to
themselves, say twenty millions, with which,
as no one has a right ever to see their books,
or to ask a question, they may choose their
time for running away, after adding to their
booty the proceeds of as much of their own
notes as they shall be able to throw into circulation.
5. The subscribers may be one,
two, or three, or more individuals (many
single individuals being able to pay in the five
millions), whereupon this bank oligarchy or
monarchy enters the field with ninety millions
of dollars, to direct and control the politics of
the nation; and of the influence of these institutions
on our politics, and into what scale
it will be thrown, we have had abundant experience.
Indeed, England herself may be
the real, while her friend and trustee here
shall be the nominal and sole subscriber.
6. This state of things is to be fastened on
us, without the power of relief, for forty or
fifty years. That is to say, the eight millions
of people now existing, for the sake of receiving
one dollar and twenty-five cents
apiece, at five per cent. interest, are to subject
the fifty millions of people who are to
succeed them within that term, to the payment
of forty-five millions of dollars, principal
and interest, which will be payable in the
course of the fifty years. 7. But the great
and national advantage is to be the relief of
the present
scarcity of money, which is produced
and proved by, 1. The additional industry
created to supply a variety of articles
for the troops, ammunition, &c. 2. By the
cash sent to the frontiers, and the vacuum occasioned
in the trading towns by that. 3.
By the late loans. 4. By the necessity of
recurring to
shavers with
good paper, which
the existing banks are not able to take up;
and 5. By the numerous applications of bank
charters showing that an increase of circulating
medium is wanting.—
To J. W. Eppes. Washington ed. vi, 229.
Ford ed., ix, 403.
(M.
Nov. 1813)
