Notwithstanding the tone of this letter, it is entirely certain that Mr. Webster had agreed to go out with his colleagues, and was expected to have done so at the time they sent in their resignations; but, in the mean while, means had been found to effect a change in his determination, probably by disavowing the application of any part of the New York Herald letter to him—certainly (as it appears from his letter) by promising a co-operation in the establishment of a national bank (for that is what was intended by the blessings of a sound currency and cheap exchanges): and also equally certain, from the same letter, that he was made to expect that he would be able to keep all whiggery together—whig President Tyler, whig members of Congress, and whig people, throughout the Union. The belief of these things shows that Mr. Webster was entirely ignorant of the formation of a third party, resting on a democratic basis; and that the President himself was in regular march to the democratic camp. But of all this hereafter.
The reconstruction of his cabinet became the immediate care of the President, and in the course of a month it was accomplished. Mr. Walter Forward, of Pennsylvania, was appointed Secretary of the Treasury; the department of War was offered to Mr. Justice McLean of the Supreme Court of the United States, and upon his refusal to accept the place, it was conferred upon John C. Spencer, Esq., of New York; Mr. Abel P. Upshur, of Virginia, was appointed Secretary of the Navy—Hugh S. Legare, Esq., of South Carolina, Attorney-General—Charles A. Wickliffe, Esq., of Kentucky, Postmaster-General. This cabinet was not of uniform political complexion. Mr. Webster had been permanentlyof that party which, under whatsoever name, had remained antagonistic to the democracy. Mr. Forward came into public life democratic, and afterwards acted with its antagonists: the same of Mr. Wickliffe and Mr. Spencer: Mr. Upshur a whig, classed with Mr. Calhoun's political friends—Mr. Legare the contrary, and democratic, and distinguished for opposition to nullification, secession, and disunion.
The conduct of Mr. Tyler in relation to a national bank produced its natural effect upon the party which had elected him—disgust and revolt. In both Houses of Congress individual members boldly denounced and renounced him. He seemed to be crushed there, for his assailants were many and fierce—his defenders few, and feeble. But a more formal act of condemnation, and separation was wanted—and had. On the 11th day of September—the day of the cabinet resignations, and two days after the transmission of the second veto message—the whigs of the two Houses had a formal meeting to consider what they should do in the new, anomalous, and acephalous condition in which they found themselves. The deliberations were conducted with all form. Mr. Senator Dixon of Rhode Island and Mr. Jeremiah Morrow of Ohio—both of them men venerable for age and character—were appointed presidents; and Messrs. Kenneth Rayner of North Carolina, Mr. Christopher Morgan of New York, and Richard W. Thompson of Indiana—all members of the House—were appointed secretaries. Mr. Mangum of North Carolina, then offered two resolutions:
"1. That it is expedient for the whigs of the Senate and House of Representatives of the United States to publish an address to the people of the United States, containing a succinct exposition of the prominent proceedings of the extra session of Congress, of the measures that have been adopted, and those in which they have failed, and the causes of such failure; together with such other matters as may exhibit truly the condition of the whig party and whig prospects."2. That a committee of three on the part of the Senate, and five on the part of the House, be appointed to prepare such address, and submit it to a meeting of the whigs on Monday morning next, the 13th inst., at half past 8 o'clock."
"1. That it is expedient for the whigs of the Senate and House of Representatives of the United States to publish an address to the people of the United States, containing a succinct exposition of the prominent proceedings of the extra session of Congress, of the measures that have been adopted, and those in which they have failed, and the causes of such failure; together with such other matters as may exhibit truly the condition of the whig party and whig prospects.
"2. That a committee of three on the part of the Senate, and five on the part of the House, be appointed to prepare such address, and submit it to a meeting of the whigs on Monday morning next, the 13th inst., at half past 8 o'clock."
Both resolutions were unanimously adopted, and Messrs. Berrien of Georgia, Tallmadge of New York, and Smith of Indiana were appointed on the part of the Senate; and Messrs. Everett of Vermont, Mason of Ohio, Kennedy of Maryland, John C. Clark of New York, and Rayner of North Carolina, on the part of the House.
At the appointed time the meeting reassembled, and the committee made their report. Much of it was taken up with views and recommendations in relation to the general policy of the party: it is only of what relates to the repudiation of Mr. Tyler that this history intends to speak: for government with us is a struggle of parties: and it is necessary to know how parties are put up, and put down, in order to understand how the government is managed. An opening paragraph of the address set forth that, for twelve years the whigs had carried on a contest for the regulation of the currency, the equalization of exchanges, the economical administration of the finances, and the advancement of industry—all to be accomplished by means of a national bank—declaring these objects to be misunderstood by no one—and the bank itself held to be secured in the presidential election, and its establishment the main object of the extra session. The address then goes on to tell how these cherished hopes were frustrated:
"It is with profound and poignant regret that we find ourselves called upon to invoke your attention to this point. Upon the great and leading measure touching this question, our anxious endeavors to respond to the earnest prayer of the nation have been frustrated by an act as unlooked for as it is to be lamented. We grieve to say to you that by the exercise of that power in the constitution which has ever been regarded with suspicion, and often with odium, by the people—a power which we had hoped was never to be exhibited on this subject, by a whig President—we have been defeated in two attempts to create a fiscal agent, which the wants of the country had demonstrated to us, in the most absolute form of proof, to be eminently necessary and proper in the presentemergency. Twice have we, with the utmost diligence and deliberation, matured a plan for the collection, safe-keeping and disbursing of the public moneys through the agency of a corporation adapted to that end, and twice has it been our fate to encounter the opposition of the President, through the application of the veto power. The character of that veto in each case, the circumstances in which it was administered, and the grounds upon which it has met the decided disapprobation of your friends in Congress, are sufficiently apparent in the public documents and the debates relating to it. This subject has acquired a painful interest with us, and will doubtless acquire it with you, from the unhappy developments with which it is accompanied. We are constrained to say, that we find no ground to justify us in the conviction that the veto of the President has been interposed on this question solely upon conscientious and well-considered opinions of constitutional scruple as to his duty in the case presented. On the contrary, too many proofs have been forced upon our observation to leave us free from the apprehension, that the President has permitted himself to be beguiled into an opinion that, by this exhibition of his prerogative, he might be able to divert the policy of his administration into a channel which should lead to new political combinations, and accomplish results which must overthrow the present divisions of party in the country; and finally produce a state of things which those who elected him, at least, have never contemplated. We have seen from an early period of the session, that the whig party did not enjoy the confidence of the President. With mortification we have observed that his associations more sedulously aimed at a free communion with those who have been busy to prostrate our purposes, rather than those whose principles seemed to be most identified with the power by which he was elected. We have reason to believe that he has permitted himself to be approached, counselled and influenced by those who have manifested least interest in the success of whig measures. What were represented to be his opinions and designs have been freely and even insolently put forth in certain portions, and those not the most reputable, of the public press, in a manner that ought to be deemed offensive to his honor, as it certainly was to the feelings of those who were believed to be his friends. In the earnest endeavor manifested by the members of the whig party in Congress to ascertain specifically the President's notions in reference to the details of such a bill relating to a fiscal agent as would be likely to meet his approbation, the frequent changes of his opinion, and the singular want of consistency in his views, have baffled his best friends, and rendered the hope of adjustment with him impossible.""The plan of an exchange bank, such as was reported after the first veto, the President is understood by more than one member of Congress to whom he expressed his opinion, to have regarded as a favorite measure. It was in view of this opinion, suggested as it is in his first veto, and after using every proper effort to ascertain his precise views upon it, that the committee of the House of Representatives reported their second bill. It made provision for a bank without the privilege of local discounting, and was adapted as closely as possible to that class of mercantile operations which the first veto message describes with approbation, and which that paper specifically illustrates by reference to the 'dealings in the exchanges' of the Bank of the United States in 1833, which the President affirms 'amounted to upwards of one hundred millions of dollars.' Yet this plan, when it was submitted to him, was objected to on a new ground. The last veto has narrowed the question of a bank down to the basis of the sub-treasury scheme, and it is obvious from the opinions of that message that the country is not to expect any thing better than the exploded sub-treasury, or some measure of the same character, from Mr.Tyler. In the midst of all these varieties of opinion, an impenetrable mystery seemed to hang over the whole question. There was no such frank interchange of sentiment as ought to characterize the intercourse of a President and his friends, and the last persons in the government who would seem to have been intrusted with his confidence on those embarrassing topics were the constitutional advisers which the laws had provided for him. In this review of the position into which the late events have thrown the whig party, it is with profound sorrow we look to the course pursued by the President. He has wrested from us one of the best fruits of a long and painful struggle, and the consummation of a glorious victory; he has even perhaps thrown us once more upon the field of political strife, not weakened in numbers, nor shorn of the support of the country, but stripped of the arms which success had placed in our hands, and left again to rely upon that high patriotism which for twelve years sustained us in a conflict of unequalled asperity, and which finally brought us to the fulfilment of those brilliant hopes which he has done so much to destroy."
"It is with profound and poignant regret that we find ourselves called upon to invoke your attention to this point. Upon the great and leading measure touching this question, our anxious endeavors to respond to the earnest prayer of the nation have been frustrated by an act as unlooked for as it is to be lamented. We grieve to say to you that by the exercise of that power in the constitution which has ever been regarded with suspicion, and often with odium, by the people—a power which we had hoped was never to be exhibited on this subject, by a whig President—we have been defeated in two attempts to create a fiscal agent, which the wants of the country had demonstrated to us, in the most absolute form of proof, to be eminently necessary and proper in the presentemergency. Twice have we, with the utmost diligence and deliberation, matured a plan for the collection, safe-keeping and disbursing of the public moneys through the agency of a corporation adapted to that end, and twice has it been our fate to encounter the opposition of the President, through the application of the veto power. The character of that veto in each case, the circumstances in which it was administered, and the grounds upon which it has met the decided disapprobation of your friends in Congress, are sufficiently apparent in the public documents and the debates relating to it. This subject has acquired a painful interest with us, and will doubtless acquire it with you, from the unhappy developments with which it is accompanied. We are constrained to say, that we find no ground to justify us in the conviction that the veto of the President has been interposed on this question solely upon conscientious and well-considered opinions of constitutional scruple as to his duty in the case presented. On the contrary, too many proofs have been forced upon our observation to leave us free from the apprehension, that the President has permitted himself to be beguiled into an opinion that, by this exhibition of his prerogative, he might be able to divert the policy of his administration into a channel which should lead to new political combinations, and accomplish results which must overthrow the present divisions of party in the country; and finally produce a state of things which those who elected him, at least, have never contemplated. We have seen from an early period of the session, that the whig party did not enjoy the confidence of the President. With mortification we have observed that his associations more sedulously aimed at a free communion with those who have been busy to prostrate our purposes, rather than those whose principles seemed to be most identified with the power by which he was elected. We have reason to believe that he has permitted himself to be approached, counselled and influenced by those who have manifested least interest in the success of whig measures. What were represented to be his opinions and designs have been freely and even insolently put forth in certain portions, and those not the most reputable, of the public press, in a manner that ought to be deemed offensive to his honor, as it certainly was to the feelings of those who were believed to be his friends. In the earnest endeavor manifested by the members of the whig party in Congress to ascertain specifically the President's notions in reference to the details of such a bill relating to a fiscal agent as would be likely to meet his approbation, the frequent changes of his opinion, and the singular want of consistency in his views, have baffled his best friends, and rendered the hope of adjustment with him impossible."
"The plan of an exchange bank, such as was reported after the first veto, the President is understood by more than one member of Congress to whom he expressed his opinion, to have regarded as a favorite measure. It was in view of this opinion, suggested as it is in his first veto, and after using every proper effort to ascertain his precise views upon it, that the committee of the House of Representatives reported their second bill. It made provision for a bank without the privilege of local discounting, and was adapted as closely as possible to that class of mercantile operations which the first veto message describes with approbation, and which that paper specifically illustrates by reference to the 'dealings in the exchanges' of the Bank of the United States in 1833, which the President affirms 'amounted to upwards of one hundred millions of dollars.' Yet this plan, when it was submitted to him, was objected to on a new ground. The last veto has narrowed the question of a bank down to the basis of the sub-treasury scheme, and it is obvious from the opinions of that message that the country is not to expect any thing better than the exploded sub-treasury, or some measure of the same character, from Mr.Tyler. In the midst of all these varieties of opinion, an impenetrable mystery seemed to hang over the whole question. There was no such frank interchange of sentiment as ought to characterize the intercourse of a President and his friends, and the last persons in the government who would seem to have been intrusted with his confidence on those embarrassing topics were the constitutional advisers which the laws had provided for him. In this review of the position into which the late events have thrown the whig party, it is with profound sorrow we look to the course pursued by the President. He has wrested from us one of the best fruits of a long and painful struggle, and the consummation of a glorious victory; he has even perhaps thrown us once more upon the field of political strife, not weakened in numbers, nor shorn of the support of the country, but stripped of the arms which success had placed in our hands, and left again to rely upon that high patriotism which for twelve years sustained us in a conflict of unequalled asperity, and which finally brought us to the fulfilment of those brilliant hopes which he has done so much to destroy."
Having thus shown the loss, by the conduct of the President, of all the main fruits of a great victory after a twelve years' contest, the address goes on to look to the future, and to inquire what is to be the conduct of the party in such unexpected and disastrous circumstances? and the first answer to that inquiry is, to establish a permanent separation of the whig party from Mr. Tyler, and to wash theirhands of all accountability for his acts.
"In this state of things, the whigs will naturally look with anxiety to the future, and inquire what are the actual relations between the President and those who brought him into power; and what, in the opinion of their friends in Congress, should be their course hereafter. On both of these questions we feel it to be our duty to address you in perfect frankness and without reserve, but, at the same time, with due respect to others. In regard to the first, we are constrained to say that the President, by the course he has adopted in respect to the application of the veto power to two successive bank charters, each of which there was just reason to believe would meet his approbation; by his withdrawal of confidence from his real friends in Congress and from the members of his cabinet; by his bestowal of it upon others notwithstanding their notorious opposition to leading measures of his administration, has voluntarily separated himself from those by whose exertions and suffrages he was elevated to that office through which he reached his present exalted station. The existence of this unnatural relation is as extraordinary as the annunciation of it is painful and mortifying. What are the consequences and duties which grow out of it? The first consequence is, that those who brought the President into power can be no longer, in any manner or degree, justly held responsible or blamed for the administration of the executive branch of the government; and that the President and his advisers should be exclusively hereafter deemed accountable."
"In this state of things, the whigs will naturally look with anxiety to the future, and inquire what are the actual relations between the President and those who brought him into power; and what, in the opinion of their friends in Congress, should be their course hereafter. On both of these questions we feel it to be our duty to address you in perfect frankness and without reserve, but, at the same time, with due respect to others. In regard to the first, we are constrained to say that the President, by the course he has adopted in respect to the application of the veto power to two successive bank charters, each of which there was just reason to believe would meet his approbation; by his withdrawal of confidence from his real friends in Congress and from the members of his cabinet; by his bestowal of it upon others notwithstanding their notorious opposition to leading measures of his administration, has voluntarily separated himself from those by whose exertions and suffrages he was elevated to that office through which he reached his present exalted station. The existence of this unnatural relation is as extraordinary as the annunciation of it is painful and mortifying. What are the consequences and duties which grow out of it? The first consequence is, that those who brought the President into power can be no longer, in any manner or degree, justly held responsible or blamed for the administration of the executive branch of the government; and that the President and his advisers should be exclusively hereafter deemed accountable."
Then comes the consideration of what they are to do? and after inculcating, in the ancient form, the laudable policy of supporting their obnoxious President when he was 'right,' and opposing him when he was 'wrong'—phrases repeated by all parties, to be complied with by none—they go on to recommend courage and unity to their discomfited ranks—to promise a new victory at the next election; and with it the establishment of all their measures, crowned by a national bank.
"The conduct of the President has occasioned bitter mortification and deep regret. Shall the party, therefore, yielding to sentiments of despair, abandon its duty, and submit to defeat and disgrace? Far from suffering such dishonorable consequences, the very disappointment which it has unfortunately experienced should serve only to redouble its exertions, and to inspire it with fresh courage to persevere with a spirit unsubdued and a resolution unshaken, until the prosperity of the country is fully re-established, and its liberties firmly secured against all danger from the abuses, encroachments or usurpations of the executive department of the government."
"The conduct of the President has occasioned bitter mortification and deep regret. Shall the party, therefore, yielding to sentiments of despair, abandon its duty, and submit to defeat and disgrace? Far from suffering such dishonorable consequences, the very disappointment which it has unfortunately experienced should serve only to redouble its exertions, and to inspire it with fresh courage to persevere with a spirit unsubdued and a resolution unshaken, until the prosperity of the country is fully re-established, and its liberties firmly secured against all danger from the abuses, encroachments or usurpations of the executive department of the government."
This was the manifesto, so far as it concerns the repudiation of Mr. Tyler, which the whig members of Congress put forth: it was answered (under the name of an address to his constituents) by Mr. Cushing, in what may be called a counter manifesto: for it was on the same subject as the other, and counter to it at all points—especially on the fundamental point of,which party the President was to belong to!the manifesto of the whig members assigning him to the democracy—the counter manifesto claiming him for the whigs! In this, Mr. Cushing followed the lead of Mr. Webster in his letter of resignation: and, in fact, the whole of his pleading (for such it was) was an amplification of Mr. Webster's letter to the editors of the National Intelligencer, and of the one to Messrs. Bates and Choate, and of another to Mr. Ketchum, of New York. The first part of the address of Mr. Cushing, is to justify the President for changing his course on the fiscal corporation bill; and this attempted in a thrust at Mr Clay thus:
"A caucus dictatorship has been set up in Congress, which, not satisfied with ruling that body to the extinguishment of individual freedom of opinion, seeks to control the President in his proper sphere of duty, denounces him before you for refusing to surrender his independence and his conscience to its decree, and proposes, through subversion of the fundamental provisions and principles of the constitution, to usurp the command of the government. It is a question, therefore, in fact, not of legislative measures, but of revolution. What is the visible, and the only professed, origin of these extraordinary movements? The whig party in Congress have been extremely desirous to cause a law to be enacted at the late session, incorporating a national bank. Encountering, in the veto of the President, a constitutional obstacle to the enactment of such a law at the late session, a certain portion of the whig party, represented by the caucus dictatorship, proceeds then, in the beginning, to denounce the President. Will you concur in this denunciation of the President?"
"A caucus dictatorship has been set up in Congress, which, not satisfied with ruling that body to the extinguishment of individual freedom of opinion, seeks to control the President in his proper sphere of duty, denounces him before you for refusing to surrender his independence and his conscience to its decree, and proposes, through subversion of the fundamental provisions and principles of the constitution, to usurp the command of the government. It is a question, therefore, in fact, not of legislative measures, but of revolution. What is the visible, and the only professed, origin of these extraordinary movements? The whig party in Congress have been extremely desirous to cause a law to be enacted at the late session, incorporating a national bank. Encountering, in the veto of the President, a constitutional obstacle to the enactment of such a law at the late session, a certain portion of the whig party, represented by the caucus dictatorship, proceeds then, in the beginning, to denounce the President. Will you concur in this denunciation of the President?"
This was the accusation, first hinted at by Mr. Rives in the Senate, afterwards obscurely intimated in Mr. Webster's letter to the two Massachusetts senators; and now broadly stated by Mr. Cushing; without, however, naming theimputed dictator; which was, in fact, unnecessary. Every body knew that Mr. Clay was the person intended; with what justice, not to repeat proofs already given, let the single fact answer, that these caucus meetings (for such there were) were all subsequent to Mr. Tyler's change on the bank question! and in consequence of it! and solely with a view to get him back! and that by conciliation until after the second veto. In this thrust at Mr. Clay Mr. Cushing was acting in the interest of Mr. Webster's feelings as well as those of Tyler; for since 1832 Mr. Clay and Mr. Webster had not been amicable, and barely kept in civil relations by friends, who had frequently to interpose to prevent, or compose outbreaks; and even to make in the Senate formal annunciation of reconciliation effected between them. But the design required Mr. Clay to be made the cause of the rejection of the bank bills; and also required him to be crippled as the leader of the anti-administration whigs. In this view Mr. Cushing resumes:
"When Lord Grenville broke up the whig party of England, in 1807, by the unseasonable pressure of some great question, and its consequent loss, 'Why,' said Sheridan, 'did they not put it off as Fox did? I have heard of men running their heads against a wall; but this is the first time I ever heard of men building a wall, and squaring it, and clamping it, for the express purpose of knocking out their brains against it.' Thisbon motof Sheridan's will apply to the whig party in Congress, if, on account of the failure of the bank bill at the late session, they secede from the administration, and set up as aTertium Quidin the government, neither administration nor opposition."
"When Lord Grenville broke up the whig party of England, in 1807, by the unseasonable pressure of some great question, and its consequent loss, 'Why,' said Sheridan, 'did they not put it off as Fox did? I have heard of men running their heads against a wall; but this is the first time I ever heard of men building a wall, and squaring it, and clamping it, for the express purpose of knocking out their brains against it.' Thisbon motof Sheridan's will apply to the whig party in Congress, if, on account of the failure of the bank bill at the late session, they secede from the administration, and set up as aTertium Quidin the government, neither administration nor opposition."
Having presented this spectacle of their brains beaten out against a wall of their own raising, if the whig party should follow Mr. Clay into opposition to the Tyler-Webster administration, Mr. Cushing took the party on another tack—that of the bird in the hand, which is worth two in the bush; and softly commences with them on the profit of using the presidential power while they had it:
"Is it wise for the whig party to throw away the actuality of power for the current four years? If so, for what object? For some contingentpossibilityfour years hence? If so, what one? Is the contingent possibility of advancing to power four years hence any one particular man in its ranks, whoever he may be, and however eminently deserving, a sufficient object to induce the whig party to abdicate the power which itself as a body possesses now?"
"Is it wise for the whig party to throw away the actuality of power for the current four years? If so, for what object? For some contingentpossibilityfour years hence? If so, what one? Is the contingent possibility of advancing to power four years hence any one particular man in its ranks, whoever he may be, and however eminently deserving, a sufficient object to induce the whig party to abdicate the power which itself as a body possesses now?"
And changing again, and from seduction to terror, he presents to them, as the most appalling of all calamities, the possible election of a democratic President at the next election through the deplorable divisions of the whig party.
"If so, will its abdication of power now tend to promote that object? Is it not, on the contrary, the very means to make sure the success of some candidate of the democratic party?"
"If so, will its abdication of power now tend to promote that object? Is it not, on the contrary, the very means to make sure the success of some candidate of the democratic party?"
Proceeding to the direct defence of the President, he then boldly absolves him from any violation of faith in rejecting the two bank bills. Thus:
"In refusing to sign those bills, then, he violated no engagement, and committed no act of perfidy in the sense of a forfeited pledge."
"In refusing to sign those bills, then, he violated no engagement, and committed no act of perfidy in the sense of a forfeited pledge."
And advancing from exculpation to applause, he makes it an act of conscience in Mr. Tyler in refusing to sign them, and places him under the imperious command of a triple power—conscience, constitution, oath; without the faculty of doing otherwise than he did.
"But, in this particular, the President, as an upright man, could do no otherwise than he did. He conscientiouslydisapprovedthose bills. And the constitution, which he was sworn to obey,commandshim, expressly and peremptorily commands him, if he do not approve of any bill presented to him for his signature, to return it to the House of Congress in which it originated. 'If he approve he shall sign it:if not, heSHALLreturn it,' are the words of the constitution. Would you as conscientious men yourselves, forbid the President of the United States to have a conscience?"
"But, in this particular, the President, as an upright man, could do no otherwise than he did. He conscientiouslydisapprovedthose bills. And the constitution, which he was sworn to obey,commandshim, expressly and peremptorily commands him, if he do not approve of any bill presented to him for his signature, to return it to the House of Congress in which it originated. 'If he approve he shall sign it:if not, heSHALLreturn it,' are the words of the constitution. Would you as conscientious men yourselves, forbid the President of the United States to have a conscience?"
Acquittal of the President of all hand in the initiation of the second bill, is the next task of Mr. Cushing, and he boldly essays it.
"The President, it is charged, trifled with one or more of the retiring secretaries. Of what occurred at cabinet meetings, the public knows and can know nothing. But, as to the main point, whether he initiated the fiscal corporation bill. This idea is incompatible with the dates and facts above stated, which show that the consideration of a new bill was forced on the President by members of Congress. It is, also, incompatible with the fact that, on Tuesday, the 17th of August, as it is said by the Secretary of War, the President expressed to him doubtas to any bill."
"The President, it is charged, trifled with one or more of the retiring secretaries. Of what occurred at cabinet meetings, the public knows and can know nothing. But, as to the main point, whether he initiated the fiscal corporation bill. This idea is incompatible with the dates and facts above stated, which show that the consideration of a new bill was forced on the President by members of Congress. It is, also, incompatible with the fact that, on Tuesday, the 17th of August, as it is said by the Secretary of War, the President expressed to him doubtas to any bill."
Now what happened in these cabinet meetings is well known to the public from the concurrent statement of three of the secretaries, and from presidential declarations to members of Congress, and these statements cover the main point of the initiation of the second bill by the President himself; and that not on the 18th, but the 16th of August, and not only to his cabinet but to Mr. Stuart of Virginia the same evening; and that it was two days afterwards that the two members of Congress called upon him (Messrs. Sergeant and Berrien), not to force him to take a bill, but to be forced by him to run his own bill through in three days. Demurring to the idea that the President could be forced by members of Congress to adopt an obnoxious bill, the brief statement is, that it is not true. The same is to be said of the quoted remark of the Secretary at War, Mr. Bell, that the President expressed to him a doubt whether he would sign any bank bill—leaving out the astonishment of the Secretary at that declaration, who had been requested by the President the day before to furnish facts in favor of the bill; and who came to deliver a statement of these facts thus prepared, and in great haste, upon request; and when brought, received with indifference! and a doubt expressed whether he would sign any bill. Far from proving that the President had a consistent doubt upon the subject, which is the object of the mutilated quotation from Mr. Bell—it proves just the contrary! proves that the President was for the bill, and began it himself, on the 16th; and was laying an anchor to windward for its rejection on the 17th! having changed during the night.
The retirement of all the cabinet ministers but one, and that for such reasons as they gave, is treated by Mr. Cushing as a thing of no signification, and of no consequence to any body but themselves. He calls it a common fact which has happened under many administrations, and of no permanent consequence, provided good successors are appointed. All that is right enough where secretaries retire for personal reasons, such as are often seen; but when they retire because they impeach the President of great moral delinquency, and refuse to remain with him on that account, the state of the case is altered. He and they are public officers; and officers at the head of the government; and their public conduct is matter of national concern; and the people have a right to inquire and to know the public conduct of public men. The fact that Mr. Webster remained is considered as overbalancing the withdrawal of all the others; and is thus noticed by Mr. Cushing:
"And that, whilst those gentlemen have retired, yet the Secretary of State, in whose patriotism and ability you have more immediate cause to confide, has declared that he knows no sufficient cause for such separation, and continues to co-operate cordially with the President in the discharge of the duties of that station which he fills with so much honor to himself and advantage to the country."
"And that, whilst those gentlemen have retired, yet the Secretary of State, in whose patriotism and ability you have more immediate cause to confide, has declared that he knows no sufficient cause for such separation, and continues to co-operate cordially with the President in the discharge of the duties of that station which he fills with so much honor to himself and advantage to the country."
Certainly it was a circumstance of high moment to Mr. Tyler that one of his cabinet remained with him. It was something in such a general withdrawing, and for such reasons as were given, and was considered a great sacrifice on the part of Mr. Webster at the time. As such it was well remembered a short time afterwards, when Mr. Webster, having answered the purposes for which he was retained, was compelled to follow the example of his old colleagues. The address of Mr. Cushing goes on to show itself, in terms, to be an answer to the address of the whig party—saying:
"Yet an address has gone forth from a portion of the members of Congress, purporting to be theunanimousact of a meeting ofTHEwhigs of Congress, which, besides arraigning the President on various allegations of fact and surmises not fact, recommends such radical changes of the constitution."
"Yet an address has gone forth from a portion of the members of Congress, purporting to be theunanimousact of a meeting ofTHEwhigs of Congress, which, besides arraigning the President on various allegations of fact and surmises not fact, recommends such radical changes of the constitution."
The address itself of the whig party is treated as the work of Mr. Clay—as an emanation of that caucus dictatorship in Congress of which he was always the embodied idea. He says:
"Those changes, if effected, would concentrate the chief powers of government in the hands of that of which this document (the whig address) itself is an emanation, namely a caucus dictatorship of Congress."
"Those changes, if effected, would concentrate the chief powers of government in the hands of that of which this document (the whig address) itself is an emanation, namely a caucus dictatorship of Congress."
This defence by Mr. Cushing, the letters of Mr. Webster, and all the writers in the interests of Mr. Tyler himself, signified nothing against the concurrent statements of the retiring senators, and the confirmatory statements of many members of Congress. The whig party recoiled from him. Instead of that "whig President, whig Congress, and whig people,"formed into a unit, with the vision of which Mr. Webster had been induced to remain when his colleagues retired—instead of this unity, there was soon found diversity enough. The whig party remained with Mr. Clay; the whig Secretary of State returned to Massachusetts, inquiring, "where am I to go?" The whig defender of Mr. Tyler went to China, clothed with a mission; and returning, found that greatest calamity, the election of a democratic President, to be a fixed fact; and being so fixed, he joined it, and got another commission thereby: while Mr. Tyler himself, who was to have been the Roman cement of this whig unity, continued his march to the democratic camp—arrived there—knocked at the gate—asked to be let in: and was refused. The national democratic Baltimore convention would not recognize him.
This subject was brought to the attention of the President at this extra session of Congress by a report from the Secretary of State, and by the President communicated to Congress along with his message. He did not seem to call for legislative action, as the subject was diplomatic, and relations were established between the countries, and the remedy proposed for the evil stated was simply one of negotiation. The origin and history of these dues, and the claims and acquiescences on which they rest, are so clearly and concisely set forth by Mr. Webster, and the amelioration he proposed so natural and easy for the United States, and the subject now acquiring an increasing interest with us, that I draw upon his report for nearly all that is necessary to be said of it in this chapter; and which is enough for the general reader. The report says:
"The right of Denmark to levy these dues is asserted on the ground of ancient usage, coming down from the period when that power had possession of both shores of the Belt and Sound. However questionable the right or uncertain its origin, it has been recognised by European governments, in several treaties with Denmark, some of whom entered into it at as early a period as the fourteenth century; and inasmuch as our treaty with that power contains a clause putting us on the same footing in this respect as other the most favored nations, it has been acquiesced in, or rather has not been denied by us. The treaty of 1645, between Denmark and Holland, to which a tariff of the principal articles then known in commerce, with a rule of measurement and a fixed rate of duty, was appended, together with a subsequent one between the same parties in 1701, amendatory and explanatory of the former, has been generally considered as the basis of all subsequent treaties, and among them of our own, concluded in 1826, and limited to continue ten years from its date, and further until the end of one year, after notice by either party of an intention to terminate it, and which is still in force."Treaties have also been concluded with Denmark, by Great Britain, France, Spain, Portugal, Russia, Prussia and Brazil, by which, with one or two exceptions in their favor, they are placed on the same footing as the United States. There has recently been a general movement on the part of the northern powers of Europe, with regard to the subject of these Sound dues, and which seems to afford to this government a favorable opportunity, in conjunction with them, for exerting itself to obtain some such alteration or modification of existing regulations as shall conduce to the freedom and extension of our commerce, or at least to relieve it from some of the burdens now imposed, which, owing to the nature of our trade, operate, in many instances, very unequally and unjustly on it in comparison with that of other nations."The ancient tariff of 1645, by which the payment of these dues was regulated, has never been revised, and by means of the various changes which have taken place in commerce since that period, and of the alteration in price in many articles therein included, chiefly in consequence of the settlement of America, and the introduction of her products, into general commerce, it has become quite inapplicable. It is presumed to have been the intention of the framers of that tariff to fix a duty of about one per centum ad valorem upon the articles therein enumerated, but the change in value of many of those commodities, and the absence of any corresponding change in the duty, has, in many instances, increased the ad valorem from one per centum to three, four, and even seven; and this, generally, upon those articles which form the chief exports of the United States, of South America, and the West India Islands: such as the articles of cotton, rice, raw sugar, tobacco, rum, Campeachy wood, &c. On all articles not enumerated in this ancient tariff it is stipulated by the treaty of 1701 that the 'privilegednations,' or those who have treaties with Denmark, shall pay an ad valorem of one per cent.; but the value of these articles being fixed by some rules known only to the Danish government, or at least unknown to us, this duty appears uncertain and fluctuating, and its estimate is very much left to the arbitrary discretion of the custom house officers at Elsinore."It has been, by some of the public writers in Denmark, contended that goods of privileged nations, carried in the vessels of unprivileged nations, should not be entitled to the limitation of one per centum ad valorem, but should be taxed one and a quarter per centum, the amount levied on the goods of unprivileged nations; and, also, that this limitation should be confined to the direct trade, so that vessels coming from or bound to the ports of a nation not in treaty with Denmark should pay on their cargoes the additional quarter per cent."These questions, although the former is not of so much consequence to us, who are our own carriers, are still in connection with each other, of sufficient importance to render a decision upon them, and a final understanding, extremely desirable. These Sound dues are, moreover, in addition to the port charges of light money, pass-money, &c., which are quite equal to the rates charged at other places, and the payment of which, together with the Sound dues, often causes to vessels considerable delay at Elsinore."The port charges, which are usual among all nations to whose ports vessels resort, are unobjectionable, except that, as in this case, they are mere consequences of the imposition of the Sound dues, following, necessarily, upon the compulsory delay at Elsinore of vessels bound up and down the Sound with cargoes, with no intention of making any importation into any port of Denmark, and having no other occasion for delay at Elsinore than that which arises from the necessity of paying the Sound dues, and, in so doing, involuntarily subjecting themselves to these other demands. These port duties would appear to have some reason in them, because of the equivalent; while, in fact, they are made requisite, with the exception, perhaps, of the expense of lights, by the delay necessary for the payment of the Sound dues."The amount of our commerce with Denmark, direct, is inconsiderable, compared with that of our transactions with Russia, Sweden, and the ports of Prussia, and the Germanic association on the Baltic; but the sum annually paid to that government in Sound dues, and the consequent port charges by our vessels alone, is estimated at something over one hundred thousand dollars. The greater proportion of this amount is paid by the articles of cotton, sugar, tobacco, and rice; the first and last of these paying a duty of about three per cent. ad valorem, reckoning their value at the places whence they come."By a list published at Elsinore, in 1840, it appears that between April and November of that year, seventy-two American vessels, comparatively a small number, lowered their topsails before the castle of Cronberg. These were all bound up the Sound to ports on the Baltic, with cargoes composed in part of the above-named products, upon which alone, according to the tariff, was paid a sum exceeding forty thousand dollars for these dues. Having disposed of these cargoes, they returned laden with the usual productions of the countries on the Baltic, on which, in like manner, were paid duties on going out through the Sound, again acknowledging the tribute by an inconvenient and sometimes hazardous ceremony. The whole amount thus paid within a period of eight months on inward and outward bound cargoes, by vessels of the United States, none of which were bound for, or intended to stop at, any port in Denmark, except compulsorily at Elsinore, for the purpose of complying with these exactions, must have exceeded the large sum above named."
"The right of Denmark to levy these dues is asserted on the ground of ancient usage, coming down from the period when that power had possession of both shores of the Belt and Sound. However questionable the right or uncertain its origin, it has been recognised by European governments, in several treaties with Denmark, some of whom entered into it at as early a period as the fourteenth century; and inasmuch as our treaty with that power contains a clause putting us on the same footing in this respect as other the most favored nations, it has been acquiesced in, or rather has not been denied by us. The treaty of 1645, between Denmark and Holland, to which a tariff of the principal articles then known in commerce, with a rule of measurement and a fixed rate of duty, was appended, together with a subsequent one between the same parties in 1701, amendatory and explanatory of the former, has been generally considered as the basis of all subsequent treaties, and among them of our own, concluded in 1826, and limited to continue ten years from its date, and further until the end of one year, after notice by either party of an intention to terminate it, and which is still in force.
"Treaties have also been concluded with Denmark, by Great Britain, France, Spain, Portugal, Russia, Prussia and Brazil, by which, with one or two exceptions in their favor, they are placed on the same footing as the United States. There has recently been a general movement on the part of the northern powers of Europe, with regard to the subject of these Sound dues, and which seems to afford to this government a favorable opportunity, in conjunction with them, for exerting itself to obtain some such alteration or modification of existing regulations as shall conduce to the freedom and extension of our commerce, or at least to relieve it from some of the burdens now imposed, which, owing to the nature of our trade, operate, in many instances, very unequally and unjustly on it in comparison with that of other nations.
"The ancient tariff of 1645, by which the payment of these dues was regulated, has never been revised, and by means of the various changes which have taken place in commerce since that period, and of the alteration in price in many articles therein included, chiefly in consequence of the settlement of America, and the introduction of her products, into general commerce, it has become quite inapplicable. It is presumed to have been the intention of the framers of that tariff to fix a duty of about one per centum ad valorem upon the articles therein enumerated, but the change in value of many of those commodities, and the absence of any corresponding change in the duty, has, in many instances, increased the ad valorem from one per centum to three, four, and even seven; and this, generally, upon those articles which form the chief exports of the United States, of South America, and the West India Islands: such as the articles of cotton, rice, raw sugar, tobacco, rum, Campeachy wood, &c. On all articles not enumerated in this ancient tariff it is stipulated by the treaty of 1701 that the 'privilegednations,' or those who have treaties with Denmark, shall pay an ad valorem of one per cent.; but the value of these articles being fixed by some rules known only to the Danish government, or at least unknown to us, this duty appears uncertain and fluctuating, and its estimate is very much left to the arbitrary discretion of the custom house officers at Elsinore.
"It has been, by some of the public writers in Denmark, contended that goods of privileged nations, carried in the vessels of unprivileged nations, should not be entitled to the limitation of one per centum ad valorem, but should be taxed one and a quarter per centum, the amount levied on the goods of unprivileged nations; and, also, that this limitation should be confined to the direct trade, so that vessels coming from or bound to the ports of a nation not in treaty with Denmark should pay on their cargoes the additional quarter per cent.
"These questions, although the former is not of so much consequence to us, who are our own carriers, are still in connection with each other, of sufficient importance to render a decision upon them, and a final understanding, extremely desirable. These Sound dues are, moreover, in addition to the port charges of light money, pass-money, &c., which are quite equal to the rates charged at other places, and the payment of which, together with the Sound dues, often causes to vessels considerable delay at Elsinore.
"The port charges, which are usual among all nations to whose ports vessels resort, are unobjectionable, except that, as in this case, they are mere consequences of the imposition of the Sound dues, following, necessarily, upon the compulsory delay at Elsinore of vessels bound up and down the Sound with cargoes, with no intention of making any importation into any port of Denmark, and having no other occasion for delay at Elsinore than that which arises from the necessity of paying the Sound dues, and, in so doing, involuntarily subjecting themselves to these other demands. These port duties would appear to have some reason in them, because of the equivalent; while, in fact, they are made requisite, with the exception, perhaps, of the expense of lights, by the delay necessary for the payment of the Sound dues.
"The amount of our commerce with Denmark, direct, is inconsiderable, compared with that of our transactions with Russia, Sweden, and the ports of Prussia, and the Germanic association on the Baltic; but the sum annually paid to that government in Sound dues, and the consequent port charges by our vessels alone, is estimated at something over one hundred thousand dollars. The greater proportion of this amount is paid by the articles of cotton, sugar, tobacco, and rice; the first and last of these paying a duty of about three per cent. ad valorem, reckoning their value at the places whence they come.
"By a list published at Elsinore, in 1840, it appears that between April and November of that year, seventy-two American vessels, comparatively a small number, lowered their topsails before the castle of Cronberg. These were all bound up the Sound to ports on the Baltic, with cargoes composed in part of the above-named products, upon which alone, according to the tariff, was paid a sum exceeding forty thousand dollars for these dues. Having disposed of these cargoes, they returned laden with the usual productions of the countries on the Baltic, on which, in like manner, were paid duties on going out through the Sound, again acknowledging the tribute by an inconvenient and sometimes hazardous ceremony. The whole amount thus paid within a period of eight months on inward and outward bound cargoes, by vessels of the United States, none of which were bound for, or intended to stop at, any port in Denmark, except compulsorily at Elsinore, for the purpose of complying with these exactions, must have exceeded the large sum above named."
This is the burden, and the history of it which Mr. Webster so succinctly presents. The peaceful means of negotiation are recommended to obtain the benefit of all the reductions in these dues which should be granted to other nations; and this natural and simple course is brought before the President in terms of brief and persuasive propriety.
"I have, therefore, thought proper to bring this subject before you at this time, and to go into these general statements in relation to it, which might be carried more into detail, and substantiated by documents now at the department, to the end that, if you should deem it expedient, instructions may be given to the representative of the United States at Denmark to enter into friendly negotiations with that government, with a view of securing to the commerce of the United States a full participation in any reduction of these duties, or the benefits resulting from any new arrangements respecting them which may be granted to the commerce of other states."
"I have, therefore, thought proper to bring this subject before you at this time, and to go into these general statements in relation to it, which might be carried more into detail, and substantiated by documents now at the department, to the end that, if you should deem it expedient, instructions may be given to the representative of the United States at Denmark to enter into friendly negotiations with that government, with a view of securing to the commerce of the United States a full participation in any reduction of these duties, or the benefits resulting from any new arrangements respecting them which may be granted to the commerce of other states."
This is the view of an American statesman. No quarrelling, or wrangling with Denmark, always our friend: no resistance to duties which all Europe pays, and were paying not only before we had existence as a nation, but before the continent on which we live had been discovered: no setting ourselves up for the liberators of the Baltic Sea: no putting ourselves in the front of a contest in which other nations have more interest than ourselves. It is not even recommended that we should join a congress of European ministers to solicit, or to force, areduction or abolition of these duties; and the policy of engaging in no entangling alliances, is well maintained in that abstinence from associated negotiation. The Baltic is a European sea. Great powers live upon its shores: other great powers near its entrance: and all Europe nearer to it than ourselves. The dues collected at Elsinore present a European question which should be settled by European powers, all that we can ask being (what Denmark has always accorded) the advantage of being placed on the footing of the most favored nation. We might solicit a further reduction of the dues on the articles of which we are the chief carriers to that sea—cotton, rice, tobacco, raw sugar; but solicit separately without becoming parties to a general arrangement, and thereby making ourselves one of its guarantees. Negotiate separately, asking at the same time to be continued on the footing of the most favored nation. This report and recommendation of Mr. Webster is a gem in our State papers—the statement of the case condensed to its essence, the recommendation such as becomes our geographical position and our policy; the style perspicuous, and even elegant in its simplicity.
I borrow from theBoston Daily Advertiser(Mr. Hale the writer) a condensed and clear account of the success of Mr. Webster's just and wise recommendations on this subject:
"He recommended that 'friendly negotiations' be instituted with the Danish government, 'with a view to securing to the United States a full participation in any reduction of these duties, or the benefits resulting from any new arrangements respecting them, which may be granted to the commerce of other states.'"This recommendation was doubtless adopted; for the concluding papers of the negotiation appear among the documents communicated to Congress. The Danish government made a complete revision of the ancient tariff, establishing new specific duties on all articles of commerce, with one or two exceptions, in which the one per cent. ad valorem duty was retained."The duties were not increased in any instance, and on many of the articles they were largely reduced; on some of them as large a discount as 83 per cent. was made, and a great number were reduced 50 per cent. Of the articles particularly mentioned by Mr. Webster as forming the bulk of the American commerce paying these duties, the duty on raw sugar was reduced from 9 stivers on 100 pounds to 5 stivers; on rice (in paddy) the duty was reduced from 15 stivers to 6 stivers. On some other articles of importance to American commerce the duties were reduced in a larger proportion; on some dyewoods the reduction was from 30 stivers to 8, and on others from 36 to 12, per thousand pounds; and on coffee the reduction was from 24 to 6 stivers per 100 pounds, thereby making it profitable to ship this article directly up the Baltic, instead of to Hamburgh, and thence by land across to Lubec, which had previously been done to avoid the Sound dues."It was also provided that no unnecessary formalities should be required from the vessels passing through the Sound. The lowering of top-sails, complained of by Mr. Webster, was dispensed with. We mention this circumstance because a recent article in theNew York Tribunespeaks of this formality as still required. It was abolished thirteen years ago. A number of other accommodations were also granted on the part of Denmark in modification of the harshness of former regulations. The time for the functionaries to attend at their offices was prolonged, and an evident disposition was manifested to make great abatements in the rigor of enforcing as well as in the amount of the tax."These concessions were regarded as eminently favorable, and as satisfactory to the United States. Mr. Webster cordially expressed this sentiment in a letter to Mr. Isaac Rand Jackson, then our Chargé d'Affaires for Denmark, bearing date June 25, 1842, and also in another letter, two days later, to Mr. Steen Billé, the Danish Chargé d'Affaires in the United States. In the former letter Mr. Webster praised Mr. Jackson's 'diligence and fidelity in discharging his duties in regard to this subject.'"
"He recommended that 'friendly negotiations' be instituted with the Danish government, 'with a view to securing to the United States a full participation in any reduction of these duties, or the benefits resulting from any new arrangements respecting them, which may be granted to the commerce of other states.'
"This recommendation was doubtless adopted; for the concluding papers of the negotiation appear among the documents communicated to Congress. The Danish government made a complete revision of the ancient tariff, establishing new specific duties on all articles of commerce, with one or two exceptions, in which the one per cent. ad valorem duty was retained.
"The duties were not increased in any instance, and on many of the articles they were largely reduced; on some of them as large a discount as 83 per cent. was made, and a great number were reduced 50 per cent. Of the articles particularly mentioned by Mr. Webster as forming the bulk of the American commerce paying these duties, the duty on raw sugar was reduced from 9 stivers on 100 pounds to 5 stivers; on rice (in paddy) the duty was reduced from 15 stivers to 6 stivers. On some other articles of importance to American commerce the duties were reduced in a larger proportion; on some dyewoods the reduction was from 30 stivers to 8, and on others from 36 to 12, per thousand pounds; and on coffee the reduction was from 24 to 6 stivers per 100 pounds, thereby making it profitable to ship this article directly up the Baltic, instead of to Hamburgh, and thence by land across to Lubec, which had previously been done to avoid the Sound dues.
"It was also provided that no unnecessary formalities should be required from the vessels passing through the Sound. The lowering of top-sails, complained of by Mr. Webster, was dispensed with. We mention this circumstance because a recent article in theNew York Tribunespeaks of this formality as still required. It was abolished thirteen years ago. A number of other accommodations were also granted on the part of Denmark in modification of the harshness of former regulations. The time for the functionaries to attend at their offices was prolonged, and an evident disposition was manifested to make great abatements in the rigor of enforcing as well as in the amount of the tax.
"These concessions were regarded as eminently favorable, and as satisfactory to the United States. Mr. Webster cordially expressed this sentiment in a letter to Mr. Isaac Rand Jackson, then our Chargé d'Affaires for Denmark, bearing date June 25, 1842, and also in another letter, two days later, to Mr. Steen Billé, the Danish Chargé d'Affaires in the United States. In the former letter Mr. Webster praised Mr. Jackson's 'diligence and fidelity in discharging his duties in regard to this subject.'"
Greatly subordinate as the United States are geographically in this question, they are equally, and in fact, duly and proportionably so in interest. Their interest is in the ratio of their distance from the scene of the imposition; that is to say, as units are to hundreds, and hundreds to thousands. Taking a modern, and an average year for the number of vessels of different powers which passed this Sound and paid these duties—the year 1850—and the respective proportions stand thus: English, 5,448 vessels; Norwegian, 2,553; Swedish, 1,982; Dutch, 1,900; Prussian, 2,391; Russian, 1,138; American, 106—being about the one-fiftieth part of the English number, and about the one-twentieth part of the other powers. But that is not the way to measure the American interest. The European powers aggregately present one interest: the United States sole another: and in this point of view the proportion of vessels is as two hundred to one. Thewhole number of European vessels in a series of five years—1849 to 1853—varied from 17,563 to 21,586; the American vessels during the same years varying from 76 to 135. These figures show the small comparative interest of the United States in the reduction, or abolition of these dues—large enough to make the United States desirous of reduction or abolition—entirely too small to induce her to become the champion of Europe against Denmark: and, taken in connection with our geographical position, and our policy to avoid European entanglement, should be sufficient to stamp as Quixotic, and to qualify as mad, any such attempt.
For ten long years the name of this bank had resounded in the two Halls of Congress. For twenty successive sessions it had engrossed the national legislature—lauded, defended, supported—treated as a power in the State: and vaunted as the sovereign remedy for all the diseases to which the finances, the currency, and the industry of the country could be heir. Now, for the first time in that long period, a session passed by—one specially called to make a bank—in which the name of that institution was not once mentioned: never named by its friends! seldom by its foes. Whence this silence? Whence this avoidance of a name so long, so lately, and so loudly invoked? Alas! the great bank had run its career of audacity, crime, oppression, and corruption. It was in the hands of justice, for its crimes and its debts—was taken out of the hands of its late insolvent directory—placed in the custody of assignees—and passed into a state of insolvent liquidation. Goaded by public reproaches, and left alone in a state of suspension by other banks, she essayed the perilous effort of a resumption. Her credit was gone. It was only for payment that any one approached her doors. In twenty days she was eviscerated of six millions of solid dollars, accumulated by extraordinary means, to enable her to bid for a re-charter at the extra session. This was the last hope, and which had been resolved upon from the moment of General Harrison's election. She was empty. The seventy-six millions of assets, sworn to the month before, were either undiscoverable, or unavailable. The shortest month in the year had been too long for her brief resources. Early in the month of February, her directory issued a new decree of suspension—the third one in four years; but it was in vain to undertake to pass off this stoppage for a suspension. It was felt by all to be an insolvency, though bolstered by the usual protestations of entire ability, and firm determination to resume briefly. An avalanche of suits fell upon the helpless institution, with judgments carrying twelve per cent. damages, and executions to be levied on whatever could be found. Alarmed at last, the stockholders assembled in general meeting, and verified the condition of their property. It was a wreck! nothing but fragments to be found, and officers of the bank feeding on these crumbs though already gorged with the spoils of the monster.
A report of the affairs of the institution was made by a committee of the stockholders: it was such an exhibition of waste and destruction, and of downright plundering, and criminal misconduct, as was never seen before in the annals of banking. Fifty-six millions and three quarters of capital out of sixty-two millions and one quarter (including its own of thirty-five) were sunk in the limits of Philadelphia alone: for the great monster, in going down, had carried many others along with her; and, like the strong man in Scripture, slew more in her death than in her life. Vast was her field of destruction—extending all over the United States—and reaching to Europe, where four millions sterling of her stock was held, and large loans had been contracted. Universally on classes the ruin fell—foreigners as well as citizens—peers and peeresses, as well as the ploughman and the wash-woman—merchants, tradesmen, lawyers, divines: widows and orphans, wards and guardians: confiding friends who came to the rescue: deceived stockholders who held on to their stock, or purchased more: the credulous masses who believed in the safety of their deposits, and in the security of the notes they held—all—all saw themselves the victims of indiscriminate ruin. An hundred millions of dollars was thelowest at which the destruction was estimated; and how such ruin could be worked, and such blind confidence kept up for so long a time, is the instructive lesson for history: and that lesson the report of the stockholders' committee enables history to give.
From this authentic report it appears that from the year 1830 to 1836—the period of its struggles for a re-charter—the loans and discounts of the bank were about doubled—its expenses trebled. Near thirty millions of these loans were not of a mercantile character—neither made to persons in trade or business, nor governed by the rules of safe endorsement and punctual payment which the by-laws of the institution, and the very safety of the bank, required; nor even made by the board of directors, as the charter required; but illegally and clandestinely, by the exchange committee—a small derivation of three from the body of the committee, of which the President of the bank wasex officioa member, and the others as good as nominated by him. It follows then that these, near thirty millions of loans, were virtually made by Mr. Biddle himself; and in violation of the charter, the by-laws and the principles of banking. To whom were they made? To members of Congress, to editors of newspapers, to brawling politicians, to brokers and jobbers, to favorites and connections: and all with a view to purchase a re-charter, or to enrich connections, and exalt himself—having the puerile vanity to delight in being called the "Emperor Nicholas." Of course these loans were, in many instances, not expected to be returned—in few so secured as to compel return: and, consequently, near all a dead loss to the stockholders, whose money was thus disposed of.
The manner in which these loans were made to members of Congress, was told to me by one of these members who had gone through this process of bank accommodation; and who, voting against the bank, after getting the loan, felt himself free from shame in telling what had been done. He needed $4,000, and could not get it at home: he went to Philadelphia—to the bank—inquired for Mr. Biddle—was shown into an ante-room, supplied with newspapers and periodicals; and asked to sit, and amuse himself—the president being engaged for the moment. Presently a side door opened. He was ushered into the presence—graciously received—stated his business—was smilingly answered that he could have it, and more if he wished it: that he could leave his note with the exchange committee, and check at once for the proceeds: and if inconvenient to give an indorser before he went home, he could do it afterwards: and, whoever he said was good, would be accepted. And in telling me this, the member said he could read "bribery" in his eyes.
The loans to brokers to extort usury upon—to jobbers, to put up and down the price of stocks—to favorites, connections, and bank officers, were enormous in amount, indefinite in time, on loose security, or none: and when paid, if at all, chiefly in stocks at above their value. The report of the committee thus states this abuse:
"These loans were generally in large amounts. In the list of debtors on 'bills receivable' of the first of January 1837, twenty-one individuals, firms and companies, stand charged, each with an amount of one hundred thousand dollars and upwards. One firm of this city received accommodations of this kind between August 1835, and November 1837, to the extent of 4,213,878 dollars 30 cents—more than half of which was obtained in 1837. The officers of the bank themselves received in this way, loans to a large amount. In March 1836, when the bank went into operation, under its new charter, Mr. Samuel Jaudon, then elected its principal cashier, was indebted to it, 100,500 dollars. When he resigned the situation of cashier, and was appointed foreign agent, he was in debt 408,389 dollars 25 cents; and on the first of March 1841, he still stood charged with an indebtedness of 117,500 dollars. Mr. John Andrews, first assistant cashier, was indebted to the bank in March 1836, 104,000 dollars. By subsequent loans and advances made during the next three years, he received in all, the sum of 426,930 dollars 67 cents. Mr. Joseph Cowperthwaite, then second assistant cashier, was in debt to the bank in March 1836, 115,000 dollars; when he was appointed cashier in September, 1837, 326,382 dollars 50 cents: when he resigned, and was elected a director by the board, in June 1840, 72,860 dollars, and he stands charged March 3, 1841, on the books with the sum of 55,081 dollars 95 cents. It appears on the books of the bank, that these three gentlemen were engaged in making investments on their joint accounts, in the stock and loan of the Camden and Woodbury railroad company Philadelphia, Wilmington, and Baltimore railroad company, Dauphin and Lycoming coal lands,and Grand Gulf railroad and banking company."
"These loans were generally in large amounts. In the list of debtors on 'bills receivable' of the first of January 1837, twenty-one individuals, firms and companies, stand charged, each with an amount of one hundred thousand dollars and upwards. One firm of this city received accommodations of this kind between August 1835, and November 1837, to the extent of 4,213,878 dollars 30 cents—more than half of which was obtained in 1837. The officers of the bank themselves received in this way, loans to a large amount. In March 1836, when the bank went into operation, under its new charter, Mr. Samuel Jaudon, then elected its principal cashier, was indebted to it, 100,500 dollars. When he resigned the situation of cashier, and was appointed foreign agent, he was in debt 408,389 dollars 25 cents; and on the first of March 1841, he still stood charged with an indebtedness of 117,500 dollars. Mr. John Andrews, first assistant cashier, was indebted to the bank in March 1836, 104,000 dollars. By subsequent loans and advances made during the next three years, he received in all, the sum of 426,930 dollars 67 cents. Mr. Joseph Cowperthwaite, then second assistant cashier, was in debt to the bank in March 1836, 115,000 dollars; when he was appointed cashier in September, 1837, 326,382 dollars 50 cents: when he resigned, and was elected a director by the board, in June 1840, 72,860 dollars, and he stands charged March 3, 1841, on the books with the sum of 55,081 dollars 95 cents. It appears on the books of the bank, that these three gentlemen were engaged in making investments on their joint accounts, in the stock and loan of the Camden and Woodbury railroad company Philadelphia, Wilmington, and Baltimore railroad company, Dauphin and Lycoming coal lands,and Grand Gulf railroad and banking company."
These enormous loans were chiefly in the year 1837, at the time when the bank stopped payment on account of the "specie circular," the "removal of the deposits," and other alleged misdoings of the democratic administrations: and this is only a sample of the way that the institution went on during that period of fictitious distress, and real oppression—millions to brokers and favorites, not a dollar to the man of business.
Two agencies were established in London—one for the bank, under Mr. Jaudon, to borrow money; the other for a private firm, of which Mr. Biddle was partner, and his young son the London head—its business being to sell cotton, bought with the dead notes of the old bank. Of the expenses and doings of these agencies, all bottomed upon the money of the stockholders (so far as it was left), the committee gave this account:
"When Mr. Jaudon was elected to the place of foreign agent, he was the principal cashier, at a salary of 7,000 dollars per annum. The bank paid the loss on the sale of his furniture, 5,074 dollars, and the passage of himself and family to London, a further sum of 1,015 dollars. He was to devote himself exclusively to the business of the bank, to negotiate an uncovered credit in England, to provide for the then existing debt in Europe, to receive its funds, to pay its bills and dividends, to effect sales of stocks, and generally to protect the interests of the bank and 'the country at large.' For these services he was to receive the commission theretofore charged and allowed to Baring Brothers & Company, equal to about 28,000 dollars per annum. In addition to which, the expenses of the agency were allowed him, including a salary of 1,000 pounds sterling to his brother, Mr. Charles B. Jaudon, as his principal clerk. From the increase of money operations, arising from facilities afforded by the agency, the amount upon which commissions were charged was greatly augmented, so that the sums paid him for his country services up to January, 1841, amounted at nine per cent. exchange to 178,044 dollars 47 cents, and the expenses of the agency to 35,166 dollars 99 cents. In addition to these sums, he was allowed by the exchange committee, an extra commission of one per cent. upon a loan effected in October, 1839, of 800,000 pounds, say $38,755 56; and upon his claim for a similar commission, upon subsequent loans in France and Holland, to the amount of $8,337,141 90, the board of directors, under the sanction of a legal opinion, from counsel of high standing, and the views of the former president, by whom the agreement with Mr. Jaudon was made, that the case of extraordinary loans was not anticipated, nor meant to be included in the original arrangement, allowed the further charge of $83,970 37. These several sums amount to $335,937, 39, as before stated."
"When Mr. Jaudon was elected to the place of foreign agent, he was the principal cashier, at a salary of 7,000 dollars per annum. The bank paid the loss on the sale of his furniture, 5,074 dollars, and the passage of himself and family to London, a further sum of 1,015 dollars. He was to devote himself exclusively to the business of the bank, to negotiate an uncovered credit in England, to provide for the then existing debt in Europe, to receive its funds, to pay its bills and dividends, to effect sales of stocks, and generally to protect the interests of the bank and 'the country at large.' For these services he was to receive the commission theretofore charged and allowed to Baring Brothers & Company, equal to about 28,000 dollars per annum. In addition to which, the expenses of the agency were allowed him, including a salary of 1,000 pounds sterling to his brother, Mr. Charles B. Jaudon, as his principal clerk. From the increase of money operations, arising from facilities afforded by the agency, the amount upon which commissions were charged was greatly augmented, so that the sums paid him for his country services up to January, 1841, amounted at nine per cent. exchange to 178,044 dollars 47 cents, and the expenses of the agency to 35,166 dollars 99 cents. In addition to these sums, he was allowed by the exchange committee, an extra commission of one per cent. upon a loan effected in October, 1839, of 800,000 pounds, say $38,755 56; and upon his claim for a similar commission, upon subsequent loans in France and Holland, to the amount of $8,337,141 90, the board of directors, under the sanction of a legal opinion, from counsel of high standing, and the views of the former president, by whom the agreement with Mr. Jaudon was made, that the case of extraordinary loans was not anticipated, nor meant to be included in the original arrangement, allowed the further charge of $83,970 37. These several sums amount to $335,937, 39, as before stated."
A pretty expensive agency, although the agent was to devote himself exclusively to the business of the bank, protecting its interests, and those of "the country at large"—an addition to his mission, this protection of the country at large, which illustrates the insolent pretensions of this imperious corporation. Protect the country at large! while plundering its own stockholders of their last dollar. And that furniture of this bank clerk! the loss on the sale of which was $5,074! and which loss the stockholders made up: while but few of them had that much in their houses. The whole amount of loans effected by this agency was twenty-three millions of dollars; of which a considerable part was raised upon fictitious bills, drawn in Philadelphia without funds to meet them, and to raise money to make runs upon the New York banks, compel them to close again: and so cover her own insolvency in another general suspension: for all these operations took place after the suspension of 1837. The committee thus report upon these loans, and the gambling in stock speculations at home:
"Such were some of the results of the resolution of March, 1835, though it cannot be questioned, that much may be fairly attributed to the unhappy situation of the business and exchanges of the country, concurring with the unfortunate policy pursued by the administration of the bank. Thus the institution has gone on to increase its indebtedness abroad, until it has now more money borrowed in Europe, than it has on loan on its list of active debt in America. To this has been superadded, extensive dealing in stocks, and a continuation of the policy of loaning upon stock securities, though it was evidently proper upon the recharter, that such a policy should be at once and entirely abandoned. Such indeed was its avowed purpose, yet one year afterwards, in March, 1837, its loans on stocks and other than personal security had increased $7,821,541, while the bills discounted on personal security, and domestic exchange had suffered a diminution of $9,516,463 78. It seems to have been sufficient, to obtain money on loan, to pledge the stock of an 'incorporated company,' however remote its operation or uncertain its prospects. Many large loans originally made on a pledge of stocks, were paid forin the same kind of property, and that too at par, when in many instances they had become depreciated in value. It is very evident to the committee, that several of the officers of the bank were themselves engaged in large operations in stocks and speculations, of a similar character, with funds obtained of the bank, and at the same time loans were made to the companies in which they were interested, and to others engaged in the same kind of operations, in amounts greatly disproportionate to the means of the parties, or to their proper and legitimate wants and dealings. The effect of this system, was to monopolize the active means of the institution, and disable it from aiding and accommodating men engaged in business really productive and useful to the community; and as might have been anticipated, a large part of the sums thus loaned were ultimately lost, or the bank compelled, on disadvantageous terms as to price, to take in payment stocks, back lands and other fragments of the estates of great speculators."
"Such were some of the results of the resolution of March, 1835, though it cannot be questioned, that much may be fairly attributed to the unhappy situation of the business and exchanges of the country, concurring with the unfortunate policy pursued by the administration of the bank. Thus the institution has gone on to increase its indebtedness abroad, until it has now more money borrowed in Europe, than it has on loan on its list of active debt in America. To this has been superadded, extensive dealing in stocks, and a continuation of the policy of loaning upon stock securities, though it was evidently proper upon the recharter, that such a policy should be at once and entirely abandoned. Such indeed was its avowed purpose, yet one year afterwards, in March, 1837, its loans on stocks and other than personal security had increased $7,821,541, while the bills discounted on personal security, and domestic exchange had suffered a diminution of $9,516,463 78. It seems to have been sufficient, to obtain money on loan, to pledge the stock of an 'incorporated company,' however remote its operation or uncertain its prospects. Many large loans originally made on a pledge of stocks, were paid forin the same kind of property, and that too at par, when in many instances they had become depreciated in value. It is very evident to the committee, that several of the officers of the bank were themselves engaged in large operations in stocks and speculations, of a similar character, with funds obtained of the bank, and at the same time loans were made to the companies in which they were interested, and to others engaged in the same kind of operations, in amounts greatly disproportionate to the means of the parties, or to their proper and legitimate wants and dealings. The effect of this system, was to monopolize the active means of the institution, and disable it from aiding and accommodating men engaged in business really productive and useful to the community; and as might have been anticipated, a large part of the sums thus loaned were ultimately lost, or the bank compelled, on disadvantageous terms as to price, to take in payment stocks, back lands and other fragments of the estates of great speculators."
The cotton agency seemed to be an ambidextrous concern—both individual and corporation—its American office in the Bank of the United States—the purchases made upon ten millions of its defunct notes—the profits going to the private firm—the losses to the bank. The committee give this history:
"In the course of the investigation the attention of the committee has been directed to certain accounts, which appear on the books as 'advances on merchandise,' but which were, in fact, payments for cotton, tobacco and other produce, purchased by the direction of the then President, Mr. Nicholas Biddle, and shipped to Europe on account of himself and others. These accounts were kept by a clerk in the foreign exchange department, this department being under the charge of Mr. Cowperthwaite, until September 22, 1837, when he was elected cashier, and of Mr. Thomas Dunlap, until March 20, 1840, when he was chosen president. The original documents, necessary to enable the committee to arrive at all the facts in relation to these transactions, were not accessible, having been retained, as was supposed, by the parties interested, as private papers. A succinct view of the whole matter, sufficient to convey to the stockholders a general idea of its character, may be drawn from the report of a committee of the board of directors, appointed on the 21st of July, 1840, for the purpose of adjusting and settling these accounts, and who reported on the 21st of December, 1840, which report with the accompanying accounts, is spread at large upon the minutes. The first transactions were in July, 1837, and appear as advances, to A. G. Jaudon, to purchase cotton for shipment to Baring Brothers & Co. of Liverpool, the proceeds to be remitted to their house in London, then acting as the agents of the bank. The amount of these shipments was 2,182,998 dollars 28 cents. The proceeds were passed to the credit of the bank, and the account appears to be balanced. The results, as to the profit and loss, do not appear, and the committee had no means of ascertaining them, nor the names of the parties interested. In the autumn of 1837, when the second of these transactions commenced, it will be recollected, that Mr. Samuel Jaudon had been appointed the agent of the bank to reside in London. About the same time, a co-partnership was formed between Mr. May Humphreys, then a director of the bank, and a son of Mr. Nicholas Biddle, under the firm of Biddle & Humphreys. This house was established at Liverpool, and thenceforward acted as agents for the sale of the produce shipped to that place which comprised a large proportion of the whole amount. In explanation of these proceedings, the committee annex to their report a copy of a letter dated Philadelphia, December 28, 1840, to the president and directors of the bank, from Mr. Joseph Cabot, one of the firm of Bevan & Humphreys, and who became a director at the election in January, 1838. This letter was read to the board, December 29, 1840, but was not inserted on the minutes."This arrangement continued during the years 1837, 1838 and 1839, the transactions of which amounted to 8,969,450 dollars 95 cents. The shipments were made principally to Biddle and Humphreys, were paid for by drafts on Bevan and Humphreys—the funds advanced by the bank, and the proceeds remitted to Mr. Samuel Jaudon, agent of the bank in London. It appears that there was paid to Messrs. Bevan and Humphreys by the bank in Philadelphia during the months of March, April, and May, 1839, the sum of eight hundred thousand dollars, and the account was thus balanced. The committee have reason to believe, that this sum constituted a part or perhaps the whole of the profits derived from the second series of shipments. How, and among whom, it was distributed, they have not been informed, but from the terms of the final settlement, to be adverted to presently, each one will be at liberty to make his own inferences. The third and last account, amounting to 3,241,042 dollars 83 cents, appears on the books, as 'bills on London, advances S. V. S. W.' These letters stand for the name of S. V. S. Wilder, of New York.—Messrs. Humphreys and Biddle, to whom these consignments were made, continued their accounts in the name of Bevan and Humphreys, but without the knowledge of that firm, as appears by Mr. Cabot's letter of December 28, 1840. The result of these last shipments, was a loss of 962,524 dollars 13 cents. Of this amount the sum of 553,908 dollars 57 cents was for excess of payments by Messrs. Humphreys and Biddle to the London agency, beyond the proceeds of sale, with interest thereon. Theparties interested, claimed and were allowed a deduction for loss on 526,000 dollars of southern funds, used in the purchase of cotton, when at a discount, the sum of 310,071 dollars 30 cents; and also this sum, being banker's commission to Messrs. Humphreys and Biddle on advances to Samuel Jaudon, agent, 21,061 dollars 86 cents, making 331,133 dollars 16 cents, and leaving to be settled by the parties the sum of 631,390 dollars 97 cents."
"In the course of the investigation the attention of the committee has been directed to certain accounts, which appear on the books as 'advances on merchandise,' but which were, in fact, payments for cotton, tobacco and other produce, purchased by the direction of the then President, Mr. Nicholas Biddle, and shipped to Europe on account of himself and others. These accounts were kept by a clerk in the foreign exchange department, this department being under the charge of Mr. Cowperthwaite, until September 22, 1837, when he was elected cashier, and of Mr. Thomas Dunlap, until March 20, 1840, when he was chosen president. The original documents, necessary to enable the committee to arrive at all the facts in relation to these transactions, were not accessible, having been retained, as was supposed, by the parties interested, as private papers. A succinct view of the whole matter, sufficient to convey to the stockholders a general idea of its character, may be drawn from the report of a committee of the board of directors, appointed on the 21st of July, 1840, for the purpose of adjusting and settling these accounts, and who reported on the 21st of December, 1840, which report with the accompanying accounts, is spread at large upon the minutes. The first transactions were in July, 1837, and appear as advances, to A. G. Jaudon, to purchase cotton for shipment to Baring Brothers & Co. of Liverpool, the proceeds to be remitted to their house in London, then acting as the agents of the bank. The amount of these shipments was 2,182,998 dollars 28 cents. The proceeds were passed to the credit of the bank, and the account appears to be balanced. The results, as to the profit and loss, do not appear, and the committee had no means of ascertaining them, nor the names of the parties interested. In the autumn of 1837, when the second of these transactions commenced, it will be recollected, that Mr. Samuel Jaudon had been appointed the agent of the bank to reside in London. About the same time, a co-partnership was formed between Mr. May Humphreys, then a director of the bank, and a son of Mr. Nicholas Biddle, under the firm of Biddle & Humphreys. This house was established at Liverpool, and thenceforward acted as agents for the sale of the produce shipped to that place which comprised a large proportion of the whole amount. In explanation of these proceedings, the committee annex to their report a copy of a letter dated Philadelphia, December 28, 1840, to the president and directors of the bank, from Mr. Joseph Cabot, one of the firm of Bevan & Humphreys, and who became a director at the election in January, 1838. This letter was read to the board, December 29, 1840, but was not inserted on the minutes.
"This arrangement continued during the years 1837, 1838 and 1839, the transactions of which amounted to 8,969,450 dollars 95 cents. The shipments were made principally to Biddle and Humphreys, were paid for by drafts on Bevan and Humphreys—the funds advanced by the bank, and the proceeds remitted to Mr. Samuel Jaudon, agent of the bank in London. It appears that there was paid to Messrs. Bevan and Humphreys by the bank in Philadelphia during the months of March, April, and May, 1839, the sum of eight hundred thousand dollars, and the account was thus balanced. The committee have reason to believe, that this sum constituted a part or perhaps the whole of the profits derived from the second series of shipments. How, and among whom, it was distributed, they have not been informed, but from the terms of the final settlement, to be adverted to presently, each one will be at liberty to make his own inferences. The third and last account, amounting to 3,241,042 dollars 83 cents, appears on the books, as 'bills on London, advances S. V. S. W.' These letters stand for the name of S. V. S. Wilder, of New York.—Messrs. Humphreys and Biddle, to whom these consignments were made, continued their accounts in the name of Bevan and Humphreys, but without the knowledge of that firm, as appears by Mr. Cabot's letter of December 28, 1840. The result of these last shipments, was a loss of 962,524 dollars 13 cents. Of this amount the sum of 553,908 dollars 57 cents was for excess of payments by Messrs. Humphreys and Biddle to the London agency, beyond the proceeds of sale, with interest thereon. Theparties interested, claimed and were allowed a deduction for loss on 526,000 dollars of southern funds, used in the purchase of cotton, when at a discount, the sum of 310,071 dollars 30 cents; and also this sum, being banker's commission to Messrs. Humphreys and Biddle on advances to Samuel Jaudon, agent, 21,061 dollars 86 cents, making 331,133 dollars 16 cents, and leaving to be settled by the parties the sum of 631,390 dollars 97 cents."
Thus, the profit of eight hundred thousand dollars on the first shipments of cotton went to this private firm, though not shown on the books to whom; and the loss of nine hundred and sixty-two thousand five hundred and twenty-four dollars and thirteen cents on the last shipments went to the bank; but this being objected to by some of the directors, it was settled by Mr. Biddle and the rest—the bank taking from them stocks, chiefly of Texas, at par—the sales of the same being slow at a tithe of their face. The bank had also a way of guaranteeing the individual contracts of Mr. Biddle for millions; of which the report gives this account:
"Upon the eighteenth day of August, 1838, the bank guaranteed a contract made by Mr. Nicholas Biddle in his individual capacity, for the purchase of two thousand five hundred bonds of the State of Mississippi, of two thousand dollars each, amounting in the whole to 5,000,000 dollars. The signature of Mr. Thomas Dunlap, then second assistant cashier, was affixed to the guarantee, in behalf of the bank, upon the verbal authority of the president. Upon the 29th of January, 1839, the bank guaranteed to the State of Michigan, the punctual fulfilment of the obligations of the Morris canal and banking company, for the purchase of bonds of that state, to the extent of 3,145,687 dollars 50 cents. for 2,700,000 taken at par, and including interest on the instalments payable every three months up to January, 1843. On the 29th of April, 1839, the bank guaranteed a contract entered into by Mr. Thomas Dunlap in his individual capacity for the purchase of one million of dollars of the 'Illinois and Michigan canal stock.' In regard to these transactions, the committee can find no authority on the minutes of the board, and have been referred to none, by the president, upon whom they called for information."
"Upon the eighteenth day of August, 1838, the bank guaranteed a contract made by Mr. Nicholas Biddle in his individual capacity, for the purchase of two thousand five hundred bonds of the State of Mississippi, of two thousand dollars each, amounting in the whole to 5,000,000 dollars. The signature of Mr. Thomas Dunlap, then second assistant cashier, was affixed to the guarantee, in behalf of the bank, upon the verbal authority of the president. Upon the 29th of January, 1839, the bank guaranteed to the State of Michigan, the punctual fulfilment of the obligations of the Morris canal and banking company, for the purchase of bonds of that state, to the extent of 3,145,687 dollars 50 cents. for 2,700,000 taken at par, and including interest on the instalments payable every three months up to January, 1843. On the 29th of April, 1839, the bank guaranteed a contract entered into by Mr. Thomas Dunlap in his individual capacity for the purchase of one million of dollars of the 'Illinois and Michigan canal stock.' In regard to these transactions, the committee can find no authority on the minutes of the board, and have been referred to none, by the president, upon whom they called for information."
Unintelligible accounts of large amounts appeared in the profit and loss side of the bank ledger; which, not explaining themselves, the parties named as receiving the money, were called upon for explanations—which they refused to give. Thus:
"In this last account there is a charge under date of June 30, 1840, of $400,000 to 'parent bank notes account,' which has not been explained to the satisfaction of the committee. It must be also mentioned, that among the expenditures of the bank, there is entered, at various dates, commencing May 5, 1836, sums amounting in all to 618,640 dollars 15 cents, as paid on the 'receipts of Mr. N. Biddle,' of 'Mr. N. Biddle and J. Cowperthwaite,' and 'cashier's vouchers.' As the committee were unable to obtain satisfactory information upon the subject of these expenses from the books or officers of the bank, application was made by letter to Mr. N. Biddle and Mr. J. Cowperthwaite, from whom no reply has been received."
"In this last account there is a charge under date of June 30, 1840, of $400,000 to 'parent bank notes account,' which has not been explained to the satisfaction of the committee. It must be also mentioned, that among the expenditures of the bank, there is entered, at various dates, commencing May 5, 1836, sums amounting in all to 618,640 dollars 15 cents, as paid on the 'receipts of Mr. N. Biddle,' of 'Mr. N. Biddle and J. Cowperthwaite,' and 'cashier's vouchers.' As the committee were unable to obtain satisfactory information upon the subject of these expenses from the books or officers of the bank, application was made by letter to Mr. N. Biddle and Mr. J. Cowperthwaite, from whom no reply has been received."
These enormous transactions generally without the knowledge of the directory, usually upon the initials of a member of the exchange committee; and frequently upon a deposit of stock in the cash drawer. Besides direct loans to members of Congress, and immense fees, there was a process of entertainment for them at immense expense—nightly dinners at hotels—covers for fifty: and the most costly wines and viands: and this all the time. Besides direct applications of money in elections, the bank became a fountain of supply in raising an election fund where needed, taking the loss on itself. Thus, in 1833, in the presidential election in Kentucky, some politicians went into the branch bank at Lexington, assessed the party in each county for the amount wanted in that county—drew drafts for the amount of the assessment on some ardent friends in the county, received the cash for the drafts from the bank, and applied it to the election—themselves not liable if the assessment was not paid, but the same to go to the profit and loss account of the bank. In such operations as all these, and these are not all, it was easy for the bank to be swallowed up: and swallowed up it was totally.
The losses to the stockholders were deplorable, and in many instances attended with circumstances which aggravated the loss. Many were widows and children, theirallinvested where it was believed to be safe; and an ascertained income relied on as certain, with eventual return of the capital. Many were unfortunately deceived into the purchase or retention of stock, by the delusive bank reports. Themakers of these reports themselves held no quantity of the stock—only the few shares necessary to qualify them for the direction. Foreign holders were numerous, attracted by the, heretofore, high credit of American securities, and by the implications of the name—Bank of the United States; implying a national ownership, which guaranteed national care in its management, and national liability on its winding up. Holland, England, France suffered, but the English most of all the foreigners. The London Banker's Circular thus described their loss:
"The proportion of its capital held by British subjects is nearly four millions sterling; it may be described as an entire loss. And the loss we venture, upon some consideration, to say is greater than the aggregate of all the losses sustained by the inhabitants of the British Islands, from failure of banks in this country, since Mr. Patterson established the banks of England and Scotland at the close of the seventeenth century. The small population of Guernsey and Jersey hold £200,000 of the stock of this U. States Bank. Call it an entire loss, and it is equal to a levy of three or four pounds on every man, woman, and child in the whole community of those islands—a sum greater than was ever raised by taxation in a single year on any people in the whole world. Are these important facts? if facts they be. Then let statesmen meditate upon them, for by their errors and reckless confidence in delusive theories they have been produced."
"The proportion of its capital held by British subjects is nearly four millions sterling; it may be described as an entire loss. And the loss we venture, upon some consideration, to say is greater than the aggregate of all the losses sustained by the inhabitants of the British Islands, from failure of banks in this country, since Mr. Patterson established the banks of England and Scotland at the close of the seventeenth century. The small population of Guernsey and Jersey hold £200,000 of the stock of this U. States Bank. Call it an entire loss, and it is equal to a levy of three or four pounds on every man, woman, and child in the whole community of those islands—a sum greater than was ever raised by taxation in a single year on any people in the whole world. Are these important facts? if facts they be. Then let statesmen meditate upon them, for by their errors and reckless confidence in delusive theories they have been produced."
The credit of the bank, and the price of stock was kept up by delusive statements of profits, and fictitious exhibition of assets and false declarations of surpluses. Thus, declaring a half-yearly dividend of four per centum, January 1st, 1839, with a surplus of more than four millions; on the first of July of the same year, another half-yearly dividend of four per centum, with a surplus of more than four millions; on the 15th of January, the same year, announcing a surplus of three millions; and six weeks thereafter, on the first of January, announcing a surplus of five millions; while the assets of the bank were carried up to seventy-six millions. In this way credit was kept up. The creating of suspensions—that of 1837, and subsequent—cost immense sums, and involved the most enormous villainy; and the last of these attempts—the run upon the New York banks to stop them again before she herself stopped for the last time—was gigantically criminal, and ruinous to itself. Mr. Joseph Cowperthwaite (perfectly familiar with the operation) describes it to the life, and with the indifference of a common business transaction. Premising that a second suspension was coming on, it was deemed best (as in the first one of 1837) to make it begin in New York; and the operation for that purpose is thus narrated:
"After the feverish excitement consequent on this too speedy effort to return to cash payments had in a good degree subsided, another crisis was anticipated, and it was feared that the banks generally would be obliged again to suspend. This was, unhappily, too soon to be realized, for the storm was then ready to burst, but, instead of meeting its full force at once, it was deemed best to make it fall first upon the banks of New York. To effect this purpose, large means were necessary, and to procure these, resort was had to the sale of foreign exchange. The state of the accounts of the bank with its agents abroad did not warrant any large drafts upon them, especially that of the Messrs. Hottinguer in Paris. This difficulty, however, it was thought might be avoided, by shipping the coin to be drawn from the New York banks immediately to meet the bills. Accordingly, large masses of exchange, particularly bills on Paris, which were then in great demand, were sent to New York to be sold without limit. Indeed, the bills were signed in blank, and so sent to New York; and although a large book was thus forwarded, it was soon exhausted, and application was made to the agent of the Paris house in New York for a further supply, who drew a considerable amount besides. The proceeds of these immense sales of exchange created very heavy balances against the New York banks, which, after all, signally failed in producing the contemplated effect. The bills not being provided for, nor even regularly advised, as had uniformly been the custom of the bank, were dishonored; and although the agent in London did every thing which skill and judgment could accomplish, the credit of the bank was gone, and from that day to the present its effects upon the institution have been more and more disastrous."
"After the feverish excitement consequent on this too speedy effort to return to cash payments had in a good degree subsided, another crisis was anticipated, and it was feared that the banks generally would be obliged again to suspend. This was, unhappily, too soon to be realized, for the storm was then ready to burst, but, instead of meeting its full force at once, it was deemed best to make it fall first upon the banks of New York. To effect this purpose, large means were necessary, and to procure these, resort was had to the sale of foreign exchange. The state of the accounts of the bank with its agents abroad did not warrant any large drafts upon them, especially that of the Messrs. Hottinguer in Paris. This difficulty, however, it was thought might be avoided, by shipping the coin to be drawn from the New York banks immediately to meet the bills. Accordingly, large masses of exchange, particularly bills on Paris, which were then in great demand, were sent to New York to be sold without limit. Indeed, the bills were signed in blank, and so sent to New York; and although a large book was thus forwarded, it was soon exhausted, and application was made to the agent of the Paris house in New York for a further supply, who drew a considerable amount besides. The proceeds of these immense sales of exchange created very heavy balances against the New York banks, which, after all, signally failed in producing the contemplated effect. The bills not being provided for, nor even regularly advised, as had uniformly been the custom of the bank, were dishonored; and although the agent in London did every thing which skill and judgment could accomplish, the credit of the bank was gone, and from that day to the present its effects upon the institution have been more and more disastrous."
"Deemed best to make the storm fall first upon the banks of New York;" and for that purpose to draw bills without limit, without funds to meet them, in such rapid succession as to preclude the possibility of giving notice—relying upon sending the gold which they drew out of the New York banks to Paris, to meet the same bills (all the while laying that exportation of gold to the wickedness of the specie circular), and failing to get the money there as fast as these "race-horse" bills went—they returned dishonored—came rolling back by millions, protested in Paris,to be again protested in Philadelphia. Then the bubble burst. The credit which sustained the monster was gone. Ruin fell upon itself, and upon all who put their trust in it; and certainly this last act, for the criminality of its intent and the audacity of its means, was worthy to cap and crown the career of such an institution.
It was the largest ruin, and the most criminal that has been seen since the South Sea and Mississippi schemes; yet no one was punished, or made to refund. Bills of indictment were found by the grand jury of the county of Philadelphia against Nicholas Biddle, Samuel Jaudon, and John Andrews, for a conspiracy to defraud the stockholders in the bank; and they were arrested, and held to bail for trial. But they surrendered themselves into custody, procured writs ofhabeas corpusfor their release; and were discharged in vacation by judges before whom they were brought. It has been found difficult in the United States to punish great offenders—much more so than in England or France. In the cases of the South Sea and Mississippi frauds, the principal actors, though men of high position, were criminally punished, and made to pay damages. While these delinquencies were going on in the Bank of the United States, an eminent banker of London—Mr. Fauntleroy—was hanged at Tyburn, like a common felon—for his bank misdeeds: and while some plundered stockholders are now (autumn of 1855) assembled in Philadelphia, searching in vain for a shilling of their stock, three of the greatest bankers in London are receiving sentence of transportation for fourteen years for offences, neither in money nor morals, the hundredth part of the ruin and crime perpetrated by our American bank—bearing the name of the United States. The case presents too strong a contrast, and teaches too great a lesson to criminal justice to be omitted; and here it is:
"The firm had been in existence for nearly two centuries. The two elder partners of the firm had been distinguished for munificent charities, for an advocacy of great moral reforms, and an active participation in the religious or philanthropic measures of the day. They had always been liberal givers, had presided at Exeter Hall meetings, built chapels, and generally acted the part of liberal and useful members of society; and one of them, Sir John Dean Paul, was a baronet by descent, and allied to some of the highest nobility of England. He was first cousin to the present Lord Ravensworth, the honorable Augustus and Adolphus Liddell, the rector of St. Paul's, Knightsbridge, the Countess of Hardwicke, Viscountess Barrington, Lady Bloomfield; and, above all, the honorable Mrs. Villiers, sister-in-law to the Earl of Clarendon. These connections, however, in a country where rank and social position have peculiar influence, did not save them from a criminal trial and utter disgrace. One of their customers, in obedience to what he believed to be a duty to society, having personally inquired into the affairs of the firm, proceeded to lay a criminal information against Messrs. Strahan, Paul, and Bates, which led to their indictment and subsequent trial before the criminal court. This gentleman was the Rev. Dr. Griffith, Prebendary of Rochester, a wealthy ecclesiastic and a personal friend of all the partners of the firm, with which he had been a large depositor for many years. On the twenty-fifth of October the trial came on before Mr. Baron Alderson, assisted by Baron Martin and Justice Willes. The defendants appeared in court, attended by Sir Frederick Thesiger, Mr. Ballantyne, Sergeant Byles, and other almost equally eminent counsel. The Attorney-general appeared for the prosecution, and the evidence adduced at the trial, disclosed the following facts: Dr. Griffith, the prosecutor in the proceedings, and who, at the time of the failure of the defendants, had money and securities on deposit with them to the amount of £22,000, about five years ago empowered them to purchase for him on three different occasions, Danish five per cent. bonds to the value of £5,000. The defendants purchased the bonds, upon which they regularly received the dividends, and credited Dr. Griffith with the same on their books. This continued until March, 1854, when Sir John D. Paul, to relieve the embarrassments under which the firm were laboring, sold these securities, together with others with which they were entrusted, and appropriated the proceeds, amounting to over £12,000, to the use of the firm. This, as we have stated, was no offence at common law, and the indictment was preferred upon a statutory provision found in the 7th and 8th of George IV., cap. 29. The rigid severity of the penal law in England on this subject will be better appreciated when we add, that the bonds were replaced by others of equal value, in the June following their misappropriation, just one year previous to the failure of the firm; and that the indictment only charged the defendants with misappropriating them in this single instance, although it was shown that the second set of bonds were again sold for the use of the firm in April, 1855; Dr. Griffith having, in the interval, regularly received his dividends; so that, although the firm might be perfectly solvent at this moment, the fact that they had sold the bonds in March, 1851, even if they had replacedthem in June, 1854, and had credited Dr. Griffith with the dividends on them between those dates, would still render them liable to an indictment. The case, therefore, overlooking the final misappropriation of the bonds, and the failure of the firm in 1855, was narrowed down to the single issue—whether they had been sold in 1854 without the consent of Dr. Griffith."
"The firm had been in existence for nearly two centuries. The two elder partners of the firm had been distinguished for munificent charities, for an advocacy of great moral reforms, and an active participation in the religious or philanthropic measures of the day. They had always been liberal givers, had presided at Exeter Hall meetings, built chapels, and generally acted the part of liberal and useful members of society; and one of them, Sir John Dean Paul, was a baronet by descent, and allied to some of the highest nobility of England. He was first cousin to the present Lord Ravensworth, the honorable Augustus and Adolphus Liddell, the rector of St. Paul's, Knightsbridge, the Countess of Hardwicke, Viscountess Barrington, Lady Bloomfield; and, above all, the honorable Mrs. Villiers, sister-in-law to the Earl of Clarendon. These connections, however, in a country where rank and social position have peculiar influence, did not save them from a criminal trial and utter disgrace. One of their customers, in obedience to what he believed to be a duty to society, having personally inquired into the affairs of the firm, proceeded to lay a criminal information against Messrs. Strahan, Paul, and Bates, which led to their indictment and subsequent trial before the criminal court. This gentleman was the Rev. Dr. Griffith, Prebendary of Rochester, a wealthy ecclesiastic and a personal friend of all the partners of the firm, with which he had been a large depositor for many years. On the twenty-fifth of October the trial came on before Mr. Baron Alderson, assisted by Baron Martin and Justice Willes. The defendants appeared in court, attended by Sir Frederick Thesiger, Mr. Ballantyne, Sergeant Byles, and other almost equally eminent counsel. The Attorney-general appeared for the prosecution, and the evidence adduced at the trial, disclosed the following facts: Dr. Griffith, the prosecutor in the proceedings, and who, at the time of the failure of the defendants, had money and securities on deposit with them to the amount of £22,000, about five years ago empowered them to purchase for him on three different occasions, Danish five per cent. bonds to the value of £5,000. The defendants purchased the bonds, upon which they regularly received the dividends, and credited Dr. Griffith with the same on their books. This continued until March, 1854, when Sir John D. Paul, to relieve the embarrassments under which the firm were laboring, sold these securities, together with others with which they were entrusted, and appropriated the proceeds, amounting to over £12,000, to the use of the firm. This, as we have stated, was no offence at common law, and the indictment was preferred upon a statutory provision found in the 7th and 8th of George IV., cap. 29. The rigid severity of the penal law in England on this subject will be better appreciated when we add, that the bonds were replaced by others of equal value, in the June following their misappropriation, just one year previous to the failure of the firm; and that the indictment only charged the defendants with misappropriating them in this single instance, although it was shown that the second set of bonds were again sold for the use of the firm in April, 1855; Dr. Griffith having, in the interval, regularly received his dividends; so that, although the firm might be perfectly solvent at this moment, the fact that they had sold the bonds in March, 1851, even if they had replacedthem in June, 1854, and had credited Dr. Griffith with the dividends on them between those dates, would still render them liable to an indictment. The case, therefore, overlooking the final misappropriation of the bonds, and the failure of the firm in 1855, was narrowed down to the single issue—whether they had been sold in 1854 without the consent of Dr. Griffith."