The Works of Daniel Webster, Volume 1

Let us see, Gentlemen, what the train of occurrences has been in regard to our revenue and finances; and when these occurrences are stated, I leave to every man the right to decide for himself whether our present difficulties have or have not arisen from attempts to extend the executive authority. In giving this detail, I shall be compelled to speak of the late Bank of the United States; but I shall speak of it historically only. My opinion of its utility, and of the extraordinary ability and success with which its affairs were conducted for many years before the termination of its charter, is well known. I have often expressed it, and I have not altered it. But at present I speak of the bank only as it makes a necessary part in the history of events which I wish now to recapitulate.

Mr. Adams commenced his administration in March, 1825. He had been elected by the House of Representatives, and began his career as President under a powerful opposition. From the very first day, he was warmly, even violently, opposed in all his measures; and this opposition, as we all know, continued without abatement, either in force or asperity, through his whole term of four years. Gentlemen, I am not about to say whether this opposition was well or ill founded, just or unjust. I only state the fact as connected with other facts. The Bank of the United States, during these four years of Mr. Adams’s administration, was in full operation. It was performing the fiscal duties enjoined on it by its charter; it had established numerous offices, was maintaining a large circulation, and transacting a vast business in exchange. Its character, conduct, and manner of administration were all well known to the whole country.

Now there are two or three things worthy of especial notice. One is, that during the whole of this heated political controversy, from 1825 to 1829, the party which was endeavoring to produce a change of administration in the general government brought no charge of political interference against the Bank of the United States. If any thing, it was rather a favorite with that party generally. Certainly, the party, as a party, did not ascribe to it undue attachment to other parties, or to the then existing administration. Another important fact is, that, during the whole of the same period, those who had espoused the cause of General Jackson, and who sought to bring about a revolution under his name, did not propose the destruction of the bank, or 364 its discontinuance, as one of the objects which were to be accomplished by the intended revolution. They did not tell the country that the bank was unconstitutional; they did not declare it unnecessary; they did not propose to get along without it, when they should come into power themselves. If individuals entertained any such purposes, they kept them much to themselves. The party, as a party, avowed none such. A third fact, worthy of all notice, is, that during this period there was no complaint about the state of the currency, either by the country generally or by the party then in opposition.

In March, 1829, General Jackson was inaugurated as President. He came into power on professions of reform. He announced reform of all abuses to be the great and leading object of his future administration; and in his inaugural address he pointed out the main subjects of this reform. But the bank was not one of them. It was not said by him that the bank was unconstitutional. It was not said that it was unnecessary or useless. It was not said that it had failed to do all that had been hoped or expected from it in regard to the currency.

In March, 1829, then, the bank stood well, very well, with the new administration. It was regarded, so far as appears, as entirely constitutional, free from political or party taint, and highly useful. It had as yet found no place in the catalogue of abuses to be reformed.

But, Gentlemen, nine months wrought a wonderful change. New lights broke forth before these months had rolled away; and the President, in his message to Congress in December, 1829, held a very unaccustomed language and manifested very unexpected purposes.

Although the bank had then five or six years of its charter unexpired, he yet called the attention of Congress very pointedly to the subject, and declared,—

1. That the constitutionality of the bank was well doubted by many;

2. That its utility or expediency was also well doubted;

3. That all must admit that it had failed to establish or maintain a sound and uniform currency; and

4. That the true bank for the use of the government of the United States would be a bank which should be founded on the revenues and credit of the government itself.

These propositions appeared to me, at the time, as very extraordinary, and the last one as very startling. A bank founded on the revenue and credit of the government, and managed and administered by the executive, was a conception which I had supposed no man holding the chief executive power in his own hands would venture to put forth.

But the question now is, what had wrought this great change of feeling and of purpose in regard to the bank. What events had occurred between March and December that should have caused the bank, so constitutional, so useful, so peaceful, and so safe an institution, in the first of these months, to start up into the character of a monster, and become so horrid and dangerous, in the last?

Gentlemen, let us see what the events were which had intervened. General Jackson was elected in December, 1828. His term was to begin in March, 1829. A session of Congress took place, therefore, between his election and the commencement of his administration.

Now, Gentlemen, the truth is, that during this session, and a little before the commencement of the new administration, a disposition was manifested by political men to interfere with the management of the bank. Members of Congress undertook to nominate or recommend individuals as directors in the branches, or offices, of the bank. They were kind enough, sometimes, to make out whole lists, or tickets, and to send them to Philadelphia, containing the names of those whose appointments would be satisfactory to General Jackson’s friends. Portions of the correspondence on these subjects have been published in some of the voluminous reports and other documents connected with the bank, but perhaps have not been generally heeded or noticed. At first, the bank merely declined, as gently as possible, complying with these and similar requests. But like applications began to show themselves from many quarters, and a very marked case arose as early as June, 1829. Certain members of the Legislature of New Hampshire applied for a change in the presidency of the branch which was established in that State. A member of the Senate of the United States wrote both to the president of the bank and to the Secretary of the Treasury, strongly recommending a change, and in his letter to the Secretary hinting very distinctly at political considerations 366 as the ground of the movement. Other officers in the service of the government took an interest in the matter, and urged a change; and the Secretary himself wrote to the bank, suggesting and recommending it. The time had come, then, for the bank to take its position. It did take it; and, in my judgment, if it had not acted as it did act, not only would those who had the care of it have been most highly censurable, but a claim would have been yielded to, entirely inconsistent with a government of laws, and subversive of the very foundations of republicanism.

A long correspondence between the Secretary of the Treasury and the president of the bank ensued. The directors determined that they would not surrender either their rights or their duties to the control or supervision of the executive government. They said they had never appointed directors of their branches on political grounds, and they would not remove them on such grounds. They had avoided politics. They had sought for men of business, capacity, fidelity, and experience in the management of pecuniary concerns. They owed duties, they said, to the government, which they meant to perform, faithfully and impartially, under all administrations; and they owed duties to the stockholders of the bank, which required them to disregard political considerations in their appointments. This correspondence ran along into the fall of the year, and finally terminated in a stern and unanimous declaration, made by the directors, and transmitted to the Secretary of the Treasury, that the bank would continue to be independently administered, and that the directors once for all refused to submit to the supervision of the executive authority, in any of its branches, in the appointment of local directors and agents. This resolution decided the character of the future. Hostility towards the bank, thenceforward, became the settled policy of the government; and the message of December, 1829, was the clear announcement of that policy. If the bank had appointed those directors, thus recommended by members of Congress; if it had submitted all its appointments to the supervision of the treasury; if it had removed the president of the New Hampshire branch; if it had, in all things, showed itself a complying, political, party machine, instead of an independent institution;—if it had done this, I leave all men to judge whether such an entire change of opinion, as to its 367 constitutionality, its utility, and its good effects on the currency, would have happened between March and December.

From the moment in which the bank asserted its independence of treasury control, and its elevation above mere party purposes, down to the end of its charter, and down even to the present day, it has been the subject to which the selectest phrases of party denunciation have been plentifully applied.

But Congress manifested no disposition to establish a treasury bank. On the contrary, it was satisfied, and so was the country, most unquestionably, with the bank then existing. In the summer of 1832, Congress passed an act for continuing the charter of the bank, by strong majorities in both houses. In the House of Representatives, I think, two thirds of the members voted for the bill. The President gave it his negative; and as there were not two thirds of the Senate, though a large majority were for it, the bill failed to become a law.

But it was not enough that a continuance of the charter of the bank was thus refused. It had the deposit of the public money, and this it was entitled to by law, for the few years which yet remained of its chartered term. But this it was determined it should not continue to enjoy. At the commencement of the session of 1832-33, a grave and sober doubt was expressed by the Secretary of the Treasury, in his official communication, whether the public moneys were safe in the custody of the bank! I confess, Gentlemen, when I look back to this suggestion, thus officially made, so serious in its import, so unjust, if not well founded, and so greatly injurious to the credit of the bank, and injurious, indeed, to the credit of the whole country, I cannot but wonder that any man of intelligence and character should have been willing to make it. I read in it, however, the first lines of another chapter. I saw an attempt was now to be made to remove the deposits of the public money from the bank, and such an attempt was made that very session. But Congress was not to be prevailed upon to accomplish the end by its own authority. It was well ascertained that neither house would consent to it. The House of Representatives, indeed, at the heel of the session, decided against the proposition by a very large majority.

The legislative authority having been thus invoked, and invoked in vain, it was resolved to stretch farther the long arm of 368 executive power, and by that arm to reach and strike the victim. It so happened that I was in this city in May, 1833, and here learned, from a very authentic source, that the deposits would be removed by the President’s order; and in June, as afterwards appeared, that order was given.

Now it is obvious, Gentlemen, that thus far the changes in our financial and fiscal system were effected, not by Congress, but by the executive; not by law, but by the will and the power of the President. Congress would have continued the charter of the bank; but the President negatived the bill. Congress was of opinion that the deposits ought not to be removed; but the President removed them. Nor was this all. The public moneys being withdrawn from the custody which the law had provided, by executive power alone, that same power selected the places for their future keeping. Particular banks, existing under State charters, were chosen. With these especial and particular arrangements were made, and the public moneys were deposited in their vaults. Henceforward these selected banks were to operate on the revenue and credit of the government; and thus the original scheme, promulgated in the annual message of December, 1829, was substantially carried into effect. Here were banks chosen by the treasury; all the arrangements with them made by the treasury; a set of duties to be performed by them to the treasury prescribed; and these banks were to hold the whole proceeds of the public revenue. In all this, Congress had neither part nor lot. No law had caused the removal of the deposits; no law had authorized the selection of deposit State banks; no law had prescribed the terms on which the revenues should be placed in such banks. From the beginning of the chapter to the end, it was all executive edict. And now, Gentlemen, I ask if it be not most remarkable, that, in a country professing to be under a government of laws, such great and important changes in one of its most essential and vital interests should be brought about without any change of law, without any enactment of the legislature whatever? Is such a power trusted to the executive of any government in which the executive is separated, by clear and well-defined lines, from the legislative department? The currency of the country stands on the same general ground as the commerce of the country. Both are intimately connected, and both are subjects of legal, not of executive, regulation.

It is worthy of notice, that the writers of the Federalist, in discussing the powers which the Constitution conferred on the President, made it matter of commendation, that it withdraws this subject altogether from his grasp. “He can prescribe no rules,” say they, “concerning the commerce or currency of the country.” And so we have been all taught to think, under all former administrations. But we have now seen that the President, and the President alone, does prescribe the rule concerning the currency. He makes it, and he alters it. He makes one rule for one branch of the revenue, and another rule for another. He makes one rule for the citizen of one State, and another for the citizen of another State. This, it is certain, is one part of the treasury order of July last.

But at last Congress interfered, and undertook to regulate the deposits of the public moneys. It passed the law of July, 1836, placing the subject under legal control, restraining the power of the executive, subjecting the banks to liabilities and duties, on the one hand, and securing them against executive favoritism, on the other. But this law contained another important provision; which was, that all the money in the treasury, beyond what was necessary for the current expenditures of the government, should be deposited with the States. This measure passed both houses by very unusual majorities, yet it hardly escaped a veto. It obtained only a cold assent, a slow, reluctant, and hesitating approval; and an early moment was seized to array against it a long list of objections. But the law passed. The money in the treasury beyond the sum of five millions was to go to the States. It has so gone, and the treasury for the present is relieved from the burden of a surplus. But now observe other coincidences. In the annual message of December, 1835, the President quoted the fact of the rapidly increasing sale of the public lands as proof of high national prosperity. He alluded to that subject, certainly with much satisfaction, and apparently in something of the tone of exultation. There was nothing said about monopoly, not a word about speculation, not a word about over-issues of paper, to pay for the lands. All was prosperous, all was full of evidence of a wise administration of government, all was joy and triumph.

But the idea of a deposit or distribution of the surplus money with the people suddenly damped this effervescing happiness. 370 The color of the rose was gone, and every thing now looked gloomy and black. Now no more felicitation or congratulation, on account of the rapid sales of the public lands; no more of this most decisive proof of national prosperity and happiness. The executive Muse takes up a melancholy strain. She sings of monopolies, of speculation, of worthless paper, of loss both of land and money, of the multiplication of banks, and the danger of paper issues; and the end of the canto, the catastrophe, is, that lands shall no longer be sold but for gold and silver alone. The object of all this is clear enough. It was to diminish the income from the public lands. No desire for such a diminution had been manifested, so long as the money was supposed to be likely to remain in the treasury. But a growing conviction that some other disposition must be made of the surplus, awakened attention to the means of preventing that surplus.

Toward the close of the last session, Gentlemen, a proposition was brought forward in Congress for such an alteration of the law as should admit payment for public lands to be made in nothing but gold and silver. The mover voted for his own proposition; but I do not recollect that any other member concurred in the vote. The proposition was rejected at once; but, as in other cases, that which Congress refused to do, the executive power did. Ten days after Congress adjourned, having had this matter before it, and having refused to act upon it by making any alteration in the existing laws, a treasury order was issued, commanding that very thing to be done which Congress had been requested and had refused to do. Just as in the case of the removal of the deposits, the executive power acted in this case also against the known, well understood, and recently expressed will of the representatives of the people. There never has been a moment when the legislative will would have sanctioned the object of that order; probably never a moment in which any twenty individual members of Congress would have concurred in it. The act was done without the assent of Congress, and against the well-known opinion of Congress. That act altered the law of the land, or purported to alter it, against the well-known will of the law-making power.

For one, I confess I see no authority whatever in the Constitution, or in any law, for this treasury order. Those who have undertaken to maintain it have placed it on grounds, not only 371 different, but inconsistent and contradictory. The reason which one gives, another rejects; one confutes what another argues. With one it is the joint resolution of 1816 which gave the authority; with another, it is the law of 1820; with a third, it is the general superintending power of the President; and this last argument, since it resolves itself into mere power, without stopping to point out the sources of that power, is not only the shortest, but in truth the most just. He is the most sensible, as well as the most candid reasoner, in my opinion, who places this treasury order on the ground of the pleasure of the executive, and stops there. I regard the joint resolution of 1816 as mandatory; as prescribing a legal rule; as putting this subject, in which all have so deep an interest, beyond the caprice, or the arbitrary pleasure, or the discretion, of the Secretary of the Treasury. I believe there is not the slightest legal authority, either in that officer or in the President, to make a distinction, and to say that paper may be received for debts at the custom-house, but that gold and silver only shall be received at the land offices. And now for the sequel.

At the commencement of the last session, as you know, Gentlemen, a resolution was brought forward in the Senate for annulling and abrogating this order, by Mr. Ewing, of Ohio, a gentleman of much intelligence, of sound principles, of vigorous and energetic character, whose loss from the service of the country I regard as a public misfortune. The Whig members all supported this resolution, and all the members, I believe, with the exception of some five or six, were very anxious in some way to get rid of the treasury order. But Mr. Ewing’s resolution was too direct. It was deemed a pointed and ungracious attack on executive polity. It must therefore be softened, modified, qualified, made to sound less harsh to the ears of men in power, and to assume a plausible, polished, inoffensive character. It was accordingly put into the plastic hands of friends of the executive to be moulded and fashioned, so that it might have the effect of ridding the country of the obnoxious order, and yet not appear to question executive infallibility. All this did not answer. The late President is not a man to be satisfied with soft words; and he saw in the measure, even as it passed the two houses, a substantial repeal of the order. He is a man of boldness and decision; and he respects boldness and decision 372 in others. If you are his friend, he expects no flinching; and if you are his adversary, he respects you none the less for carrying your opposition to the full limits of honorable warfare. Gentlemen, I most sincerely regret the course of the President in regard to this bill, and certainly most highly disapprove it. But I do not suffer the mortification of having attempted to disguise and garnish it, in order to make it acceptable, and of still finding it thrown back in my face. All that was obtained by this ingenious, diplomatic, and over-courteous mode of enacting a law, was a response from the President and the Attorney-General, that the bill in question was obscure, ill penned, and not easy to be understood. The bill, therefore, was neither approved nor negatived. If it had been approved, the treasury order would have been annulled, though in a clumsy and objectionable manner. If it had been negatived, and returned to Congress, no doubt it would have been passed by two thirds of both houses, and in that way have become a law, and abrogated the order. But it was not approved, it was not returned; it was retained. It had passed the Senate in season; it had been sent to the House in season; but there it was suffered to lie so long without being called up, that it was completely in the power of the President when it finally passed that body; since he is not obliged to return bills which he does not approve, if not presented to him ten days before the end of the session. The bill was lost, therefore, and the treasury order remains in force. Here again the representatives of the people, in both houses of Congress, by majorities almost unprecedented, endeavored to abolish this obnoxious order. On hardly any subject, indeed, has opinion been so unanimous, either in or out of Congress. Yet the order remains.

And now, Gentlemen, I ask you, and I ask all men who have not voluntarily surrendered all power and all right of thinking for themselves, whether, from 1832 to the present moment, the executive authority has not effectually superseded the power of Congress, thwarted the will of the representatives of the people, and even of the people themselves, and taken the whole subject of the currency into its own grasp? In 1832, Congress desired to continue the bank of the United States, and a majority of the people desired it also; but the President opposed it, and his will prevailed. In 1833, Congress refused to remove the deposits; 373 the President resolved upon it, however, and his will prevailed. Congress has never been willing to make a bank founded on the money and credit of the government, and administered, of course, by executive hands; but this was the President’s object, and he attained it, in a great measure, by the treasury selection of deposit banks. In this particular, therefore, to a great extent, his will prevailed. In 1836, Congress refused to confine the receipts for public lands to gold and silver; but the President willed it, and his will prevailed. In 1837, both houses of Congress, by more than two thirds, passed a bill for restoring the former state of things by annulling the treasury order; but the President willed, notwithstanding, that the order should remain in force, and his will again prevailed. I repeat the question, therefore, and I would put it earnestly to every intelligent man, to every lover of our constitutional liberty, are we under the dominion of the law? or has the effectual government of the country, at least in all that regards the great interest of the currency, been in a single hand?