avoiding establishing a real Treasury, that provision of the Constitution became, in so far as regards the application of money to private uses, a dead letter. By the interpretation which fixed the locality of the Treasury wherever there was money to the credit of the Treasurer, all sums paid in on account of the Government, whether in specie or paper, became in point of fact mere debts due from corporations or individuals to the Government. They became mixed with the other funds of corporations and individuals, and could be used by them with impunity till payment of the debt was demanded.

Here lies the

. Hence the multitude of defaults that have occurred. root of the evil, and to this let the axe be speedily applied. Every clerk in a merchant's counting house knows the difference between his employer's money and his own; but the receiving and disbursing officers of the United States Government do not know the difference between their own money and that which they hold in trust for the people. They employ the latter in their private speculations, and if these prove unfortunate, they cannot repay the sums thus misapplied. No Government but our own suffers its personal agents thus to misappropriate the public funds. Several permit banks, under certain restrictions, to use public deposites in their current business; but none allows this privilege to its receiving and disbursing officers. Perhaps France may be adduced as an exception; but the exception is only apparent. All the provincial receivers are there required to make deposites in the Treasury in advance, in amounts believed to be sufficient to cover their monthly collections. Every ten days they remit to the Treasury such sums as they have on hand; and if, through any accident, a balance remains in their possession, they are charged interest on the same. If in the French fiscal regulation no express prohibitions can be found against public officers applying the public money to private uses, it is owing to the workings of the French system being such that the Treasury is in most instances in debt to the collecting officers, instead of the collecting officers being in debt to the Treasury.

In Great Britain, none even of the banks, except the Bank of England, and perhaps the Bank of Ireland, are suffered to have the use of the public funds for any longer time than is regarded as a sufficient compensation for the trouble and expense of collecting it and transmitting it to London. The banks at Liverpool are allowed this use of the public money for only fifteen days. The receiving banks at Glasgow make remittances weekly to London, in bills or drafts at seventeen days date.

A majority of the people of the United States have decided in favor of a separation of bank and state, and a majority of the present Congress are pledged to carry their wishes into effect. Yet we are by no means as sanguine as many, that the necessary bills will be passed during the present session. The banks have still great power over the representatives of the people and of the States; and even supposing that they have no disposition to exert that power so as to produce distraction of councils, there may be honest differences of opinion in regard to the

details of the system that should be adopted: in fact, it is impossible to see how such differences of opinion are to be avoided. No bill embracing the whole of a new system can be passed, unless the members friendly to a separation of bank and state should be willing to make many compromises in regard to details. In a single session it may be impossible for them to come to a proper understanding on many points. Nevertheless, a beginning ought to be made. The people expect it. The people will not rest satisfied (nor ought they to rest satisfied) unless something be done towards effecting an object which becomes more nd more a favorite with them, the better it is understood. Under these circumstances, it would be unwise to risk the loss of every thing by attempting too much at once. It would be inexpedient to give room for a diversity of opinion by bringing in, at first, a bill embracing a multitude of details. True policy would seem to point to beginning the work with a very short bill, perhaps one of a single section. That, however, should lay the axe at the root of the evil. It should prohibit, under sufficient penalties, the application of public money to private uses. The circumstances of the times call loudly for this. The recent report of the Secretary of the Treasury shows that it is principally during seasons of pecuniary embarrassment that defaults occur. As pecuniary embarrassments are now very severe, and, it is to be feared, will continue to be so for some time to come, it is rational to expect that the number of defaults will increase if the free use of the public funds is permitted to public officers. Some of the orators of the opposition have been very eloquent in denouncing defaulters. Will they be so inconsistent with their professions as to offer any serious opposition to a bill which would be the most effective measure it would be possible immediately to adopt, to prevent future defaults?

If we had the honor to hold a seat in "the House," we would be quite willing to test their sincerity. We would be willing, rather than the bill should not pass, to accept an amendment (provided it came from the opposition) declaring the banks that are at present employed, or any that may hereafter be employed, as public depositories, might be permitted to use the public deposites in their current business. We would postpone, for the present, the great question of the separation of bank and state, that we might immediately put a stop to defaults among the personal agents of Government.

This once done, the Government could carry on its fiscal operations with comparative safety, till Congress should have time to mature a constitutional treasury system. This will require deliberation, for it is not every Independent Treasury System that will answer. Some of the plans that have been submitted are mere crudities. Others are, in the main, good, but require much amendment. This, at least, is what is said by some of those who have paid most attention to the subject. They rejoiced rather than mourned at the loss of certain so-called "Sub-TreaVOL. VII. NO. XXV.-JAN., 1840.

D

sury" bills, because convinced that, under such provisions as they contained, the system must necessarily fail in practice.

It is here proper to correct a prevalent error. No new legislation is requisite for the creation of "sub-treasuries." Every post office is in fact one, and so is every custom-house and every land office. They all receive, keep, and pay away money on public account. They have done so from the beginning of the Government, and do so still, and will continue so to do, whether the constitutional system be adopted or not. If the operations of some of these offices have been in some respects irregular, such irregularity may be traced up to the practice of allowing the officers to apply the public money to private uses. The legislation, then, that is required in regard to existing sub-treasuries is, that which will put an end to this practice.

What are really wanted, of a new character, are, a few GENERAL OFFICES, to perform for Government those functions that have hitherto been performed for it by the banks. Of these, not more than eight, perhaps, would be necessary-though if a greater number could be established it might contribute to the perfection of the system.

In each of these offices there ought to be three officers, appointed by the President with the concurrence of the Senate. They ought not to receive their offices from one another, because they should be checks and guards on one another, and if any one of them should prove to to be a defaulter, and the other two should not be able to show that it was through no neglect of theirs that the default occurred, they should be held responsible for the loss, if the defaulter and his sureties could not make it good. If the assistance of subordinates in any of these general offices should be necessary, they ought to be appointed by the principals, with the consent of the Secretary of the Treasury; but those who make the appointment should be responsible for any loss that might occur through the misconduct of those thus appointed. On the French system, all subordinates are appointed by the Supreme Government. Owing to a variety of circumstances, it would be difficult for the Government at Washington to get a competent knowledge of the character of applicants for subordinate stations in treasury offices. It will, therefore, for this and other reasons, be advisable to give the appointment of the subordinates to the principals, making them responsible in the manner already stated.

As additional safeguards, a competent number of inspectors should be appointed by the President and Senate. Their duty should be to visit these treasury offices without giving previous notice, and inspect the books, papers, and money on hand, so that no officer may be led into temptation If they discover any irregularity of administration, or have ground to suspect that any default has occurred, they should immediately report the same to the proper officers at Washington. And in order that these officers at Washington may be kept to the strict performance of their duty, it should be the duty of the inspectors to report

annually to the House of Representatives any irregularities of administration they have discovered, and which have remained uncorrected, and any defaults that have occurred, whether the defaulters have or have not been removed from office.

As these inspectors might abuse their power or neglect their duty, or might, from sickness or distance, be unable to perform their duty in some instances as promptly as desirable, power should be granted to the Secretary of the Treasury to appoint special inspectors in cases where, in his judgment, the public interests made their services necessary.

Prompt auditing of accounts is another essential feature in a good fiscal system. The accounts of these offices should be audited at least quarterly, nor should the final settlement of any such accounts be postponed for more than three months after the termination of each quarter.

There is another provision which it would be gratifying to see introduced, namely: That a committee of the House of Representatives should be appointed annually, to examine into all the particulars relating to these Treasury offices. It is supposed, however, that such a provision would hardly be constitutional. By it, if made part of the law, the House of Representatives, a co-ordinate branch of the Government, would be bound to the performance of a certain duty not explicitly prescribed by the constitution, and from which it could not be formally released except by the President and Senate consenting to a repeal of this part of the act. The House has, however, the power, and it ought to esteem it part of its duty, to make such an annual examination. The French Legislature annually appoints from its own body a "Court of Verification," as it is called, which spends considerable time in examining into the affairs of the Treasury.

Under such a system as this, it would be almost impossible that abuses should occur, unless House, Senate, President, Secretary of the Treasury, the Treasurer, the Inspectors of the Treasury, and principals and subordinates of treasury offices, should all prove corrupt.

The principals in each treasury office would, in the first place, be checks and guards upon one another, and mutually responsible for each other's good conduct, and for that of their subordinates.

The inspectors would be a further check on them, and not only on them, but on the Secretary of the Treasury, and on the President. If these high officers neglected their duty, in failing to remove defaulters or correct mal-administration, such facts would become evident from the report of the inspectors to the House of Representatives.

In the next place, the auditors and comptrollers, by promptly settling accounts, would prove effective guards against misuses of the public funds.

Lastly, the House of Representatives, by the plenary power it would possess of examining into each and every matter concerning the treasury, would prove an effective guard against abuses of power by the President,

the Secretary of the Treasury, and all inferior officers of the depart

ment.

On the importance of some other subjects, such as uniformity of accounts, and publicity of accounts, it is unnecessary to dwell, as they already, in theory at least, form part of the present system.

In regard to mere matters of administrative detail, it will be perhaps impossible to fix them by law, because they must vary with varying circumstances. But as every treasury regulation ought to have at least the tacit sanction of the National Legislature, the officers of the department ought to be required to lay before Congress forms of the manner of keeping books and accounts, and copies of all treasury orders and regulations. Thus the whole subject would be laid before the representatives of the people, and they could readily discover if further legisla tion would be necessary.

There is, however, one power, which, if the Treasury Department does not now possess it, ought perhaps to be granted to it. We allude to a power to receive, at convenient public depositories, money in advance in payment for lands. There will be an absurdity in requiring an emigrant, landing at Detroit or St. Louis, to carry some three or four hundred miles into the interior the money to purchase his quarter section, when the Government will, before it can disburse the money as the public service requires, be obliged to bring it back to St. Louis or Detroit. The expense to which Government and people have been put by carting and re-carting money from the banks to the land offices, and back again from the land offices to the banks, would probably pay the expenses of a good treasury system.

Perhaps the principle might with advantage be extended, so as to allow payments in advance to be made for other dues to Government. For example, if a merchant in New York had to pay a sum for duties, and had that amount owing to him by a merchant at St. Louis, he might be authorized to direct the latter to pay the money into the treasury office at St. Louis, and with the certificate of deposite liquidate the demand against himself at the New York custom-house. In this way the merchants would be accommodated and the Government put to no inconvenience. If these certificates of deposite should circulate for a few months, no harm would be thereby done, as they would be actual representatives of specie-not like bank bills, mere promises.

But every precaution should be used against these treasury offices degenerating into banks, in the American sense of the word banks. No drafts should be drawn on them except for specie actually in their vaults. For the convenience of the public creditors, permission might be given to divide large claims into various drafts, but none of a less amount than one hundred dollars. Further than this no hard money man can go with propriety. All certificates of deposite, and all Government drafts payable on demand, should be representatives of gold and silver actually in some depository.