655. BANK (National 1813), Charter of.—
The scheme is for Congress to establish
a national bank, suppose of thirty millions
capital, of which they shall contribute ten
millions in six per cent. stock, the States ten
millions, and individuals ten millions, one
half of the two last contributions to be of a
similar stock, for which the parties are to
give cash to Congress; the whole, however,
to be under the exclusive management of the
individual subscribers, who are to name all
the directors; neither Congress nor the States
having any power of interference in its administration.
Discounts are to be at five per
cent., but the profits are expected to be at seven
per cent. Congress then will be paying six
per cent. on twenty millions, and receiving
seven per cent. on ten millions, being its
third of the institution; so that on the ten
millions cash which they receive from the
States and individuals, they will, in fact, have
to pay but five per cent. interest. This is the
bait. The charter is proposed to be for forty
or fifty years, and if any future augmentations
should take place, the individual proprietors
are to have the privilege of being the
sole subscribers for that. Congress are further
allowed to issue to the amount of three
millions of notes, bearing interest, which they
are to receive back in payment for lands at a
premium of five or ten per cent., or as subscriptions
for canals, roads, and bridges, in
which undertakings they are, of course, to
be engaged. This is a summary of the case
as I understand it; but it is very possible I
may not understand it in all its parts, these
schemes being always made unintelligible for
the gulls who are to enter into them.—
To J. W. Eppes. Washington ed. vi, 228.
Ford ed., ix, 403.
(M.
Nov. 1813)
