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of stock, by the delusive bank reports. The ruinous to itself. Mr. Joseph Cowperthwaite makers of these reports themselves held no (perfectly familiar with the operation) describes quantity of the stock-only the few shares it to the life, and with the indifference of a necessary to qualify them for the direction. common business transaction. Premising that Foreign holders were numerous, attracted by a second suspension was coming on, it was the, heretofore, high credit of American securi- deemed best (as in the first one of 1837) to ties, and by the implications of the name-Bank make it begin in New York; and the operation of the United States; implying a national owner- for that purpose is thus narrated: ship, 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 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 halfyearly 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

"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 bank was gone, and from that day to the present judgment could accomplish, the credit of the 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 "racehorse" 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.

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 It was the largest ruin, and the most criminal peculiar influence, did not save them from a that has been seen since the South Sea and criminal trial and utter disgrace. One of their Mississippi schemes; yet no one was punished, be a duty to society, having personally inquired customers, in obedience to what he believed to or made to refund. Bills of indictment were into the affairs of the firm, proceeded to lay a found by the grand jury of the county of Phila- criminal information against Messrs. Strahan, delphia against Nicholas Biddle, Samuel Jaudon, Paul, and Bates, which led to their indictment and John Andrews, for a conspiracy to defraud and subsequent trial before the criminal court. This gentleman was the Rev. Dr. Griffith, Prethe stockholders in the bank; and they were bendary of Rochester, a wealthy ecclesiastic and arrested, and held to bail for trial. But they a personal friend of all the partners of the firm, surrendered themselves into custody, procured with which he had been a large depositor for writs of habeas corpus for their release; and many years. On the twenty-fifth of October the trial came on before Mr. Baron Alderson, were discharged in vacation by judges before assisted by Baron Martin and Justice Willes. whom they were brought. It has been found The defendants appeared in court, attended by difficult in the United States to punish great Sir Frederick Thesiger, Mr. Ballantyne, Seroffenders-much more so than in England or geant Byles, and other almost equally eminent counsel. The Attorney-general appeared for the France. In the cases of the South Sea and prosecution, and the evidence adduced at the Mississippi frauds, the principal actors, though trial, disclosed the following facts: Dr. Griffith, men of high position, were criminally punished, the prosecutor in the proceedings, and who, at and made to pay damages. While these delin- the time of the failure of the defendants, had quencies were going on in the Bank of the the amount of £22,000, about five years ago emand securities on deposit with them to money United States, an eminent banker of London-powered them to purchase for him on three difMr. Fauntleroy-was hanged at Tyburn, like a ferent occasions, Danish five per cent. bonds to common felon for his bank misdeeds: and the value of £5,000. The defendants purchased the bonds, upon which they regularly received while some plundered stockholders are now the dividends, and credited Dr. Griffith with (autumn of 1855) assembled in Philadelphia, the same on their books. This continued until searching in vain for a shilling of their stock, March, 1854, when Sir John D. Paul, to relieve three of the greatest bankers in London are re- the embarrassments under which the firm were ceiving sentence of transportation for fourteen laboring, sold these securities, together with others with which they were entrusted, and years for offences, neither in money nor morals, appropriated the proceeds, amounting to over the hundredth part of the ruin and crime per- £12,000, to the use of the firm. This, as we petrated by our American bank-bearing the have stated, was no offence at common law, and the indictment was preferred upon a statutory name of the United States. The case presents provision found in the 7th and 8th of George IV., too strong a contrast, and teaches too great a cap. 29. The rigid severity of the penal law in lesson to criminal justice to be omitted; and England on this subject will be better apprehere it is: ciated 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

"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

bonds in March, 1851, even if they had replaced them 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."

For misappropriating sixty thousand dollars of one of their customers-using it without his consent these three great London bankers were sentenced to fourteen years' transportation: for misappropriating thirty-five millions, and sinking twenty-one millions more in other institutions, the wrong-doers go free in the United States-giving some countenance among us to the sarcasm of the Scythian philosopher, that laws are cobwebs which catch the weak flies, and let the strong ones break through. The Judge (Mr. Baron Alderson) who tried this case (that of the three London bankers), had as much heart and feeling as any judge, or man ought to have; but he also had a sense of his own duty, and of his obligations to the laws, and to the country; and in sentencing men of such high position, and with whom he had been intimate and social, he combined in the highest degree the feelings of a man with the duties of the judge. He said to the prisoners:

"William Strahan, Sir John Dean Paul, and Robert Makin Bates, the jury have now found you guilty of the offence charged upon you in the indictment-the offence of disposing of securities which were entrusted by your customers to you as bankers, for the purpose of being kept safe for their use, and which you appropriated, under circumstances of temptation, to your own. A greater and more serious offence can hardly be imagined in a great commercial city like this. It tends to shake confidence in all persons in the position you occupied, and it has shaken the public confidence in establishments like that you for a long period honorably conducted. I do very, very much regret that it falls to my lot to pass any sentence on persons in your situation; but yet the public interest and public justice require it; and it is not for me to shrink from the discharge of any duty, however painful, which properly belongs to my office. I should have been very glad, if it had pleased God that some one else now had to discharge that duty. I have seen (continued the learned judge, with deep emotion) at least one of you under very different circumstances, sitting at my side in high office, instead of being where you now are, and I could scarcely then have fancied to myself that it would ever come to me to pass sentence on you.

But so it is, and this is a proof, therefore, that we all ought to pray not to be led into temptation. You have been well educated, and held a high position in life, and the punishment which must fall on you will consequently be the more seriously and severely felt by you, and will also greatly affect those connected with you, who will most sensitively feel the disgrace of your position. All that I have to say is, that I cannot conceive any worse case of the sort arising under the act of Parliament, applicable to your offence. Therefore, as I cannot conceive any worse case under the act, I can do nothing else worst case, namely, the most severe punishment, but impose the sentence therein provided for the which is, that you be severally transported for fourteen years."

For the admiration of all in our America-for the imitation of those who may be called to act in the like cases-with the sad conviction that

the administration of criminal justice is not equal in our Republic to what it is in the monthis brief notice of judicial action in an English archies of Europe: for the benefit of all such, court against eminent, but culpable bankers, is here given-contrasting so strikingly with the vain attempts to prosecute those so much more culpable in our own country.

CHAPTER LXXXVIII.

END AND RESULTS OF THE EXTRA SESSION

THIS extraordinary session, called by President Harrison, held under Mr. Tyler, dominated by Mr. Clay, was commenced on the 31st of May and ended the 13th of September: seventy-five days' session-and replete with disappointed calculations, and nearly barren of permanent results. The whigs expected from it an easy and victorious course of legislation, and the consolidation of their power by the inauguration of their cherished measures for acting on the people-national bank-paper money national currency-union of bank and state-distribution of public money-bankrupt act-monopoly of office. The democracy saw no means of preventing these measures; but relied upon the goodness of their cause, the badness of the measures to be adopted by the whigs, and the blunders they would commit, to give them eventual victory, and soon to restore parties to

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last, not least, THAT ONE HOUR RULE! which has silenced the representatives of the people in the House of Representatives, reduced the national legislation to blind dictation, suppressed opposition to evil measures, and deprived the people of the means of knowing the evil that Congress is doing.

To the democracy it was a triumphant session-triumphant in every thing that constitutes moral and durable triumph. They had broken down the whig party before the session was over-crushed it upon its own measures ; and were ready for the elections which were to reverse the party positions. The Senate had done it. The House, oppressed by the hour rule, and the tyrannical abuse of the previous question, had been able to make but little show. The two-and-twenty in the Senate did the work; and never did I see a body of men more effective or brilliant-show a higher spirit or a more determined persistence. To name the speakers, would be to enumerate all-except Mr. Mouton, who not having the English language perfect was limited to his vote-always in place, and always faithful. The Globe newspaper was a powerful assistant, both as an ally working in its own columns, and as a vehicle of communication for our daily debates. Before the session was over we felt ourselves victorious, and only waiting for the day when the elections were to show it. Of all our successes, that of keeping the hour rule, and the previous question out of the American Senate, was the most brilliant, and durably beneficent-rising above party-entering the high region of free government-preserving the liberty of speech-preserving to republican government its distinctive and vital feature, that of free debate; and saving national legislation from unresisted party dictation.

their usual relative positions. The defection of Mr. Tyler was not foreseen: his veto of a national bank was not counted upon: the establishment of that institution was considered certain: and the only remedy thought of was in the repeal of the law establishing it. As a public political corporation, that repealability came within the decision of the Supreme Court of the United States in the Dartmouth College case; and being established for the good of the state, it became amenable to the judgment of the State upon the question of good, or evil to be decided by the political power. Repealability was then the reliance against a national bank; and that ground was immediately taken, and systematically urged-both for the purpose of familiarizing the people with the idea of repeal, and of deterring capitalists from taking its stock. The true service that Mr. Tyler did the democratic party was in rejecting the bank charters (for such they both were, though disguised with ridiculous names). Numerically he weakened the whig ranks but little: potentially not at all-as those who joined him, took office: and became both useless to him, and a reproach. That beau ideal, of a whig unity—“ whig President, whig Congress, and whig people "-which Mr. Webster and Mr. Cushing were to realize, vanished: and they with it—leaving Mr. Tyler without whig, and without democratic adherents; but with a small party of his own as long as he was in a condition to dispense office. The legislation of the session was a wreck. The measures passed, had no duration. The bankrupt act, and the distribution act, were repealed by the same Congress that passed them-under the demand of the people. The new tariff act, called revenue -was changed within a year. The sub-treasury system, believed to have been put to death, came to life again. Gold and silver, intended to have been ignored as a national currency, had become that currency-both for the national coffers, and the people's pockets. Of all the measures of that extraordinary session, opening with so much hope, nothing now re- FIRST ANNUAL MESSAGE OF PRESIDENT TYLER. mains to recall the idea of its existence, but, first-THE HOME SQUADRON! keeping idle watch on our safe coasts, at the cost of a million per annum. Next, THE OCEAN LINE STEAMERS! plundering the country of two millions annually, oppressing fair competition, and damaging the character of Congress. And

CHAPTER LXXXIX.

THIS message coming in so soon after the termination of the extra session-only two months after it was necessarily brief and meagre of topics, and presents but few points worthy of historical remembrance. The first subject mentioned was the acquittal of M'Leod, which had

taken place in the recess and with which re- extension of the term for the redeemability of

sult the British government was content. The next subject was, the kindred matter of the Caroline; on which the President had nothing satisfactory to communicate, but expressed a high sense of the indignity which had been offered to the United States, and evinced a becoming spirit to obtain redress for it. He said:

"I regret that it is not in my power to make known to you an equally satisfactory conclusion in the case of the Caroline steamer, with the circumstances connected with the destruc

tion of which, in December, 1837, by an armed force fitted out in the Province of Upper Canada, you are already made acquainted. No such atonement as was due for the public wrong done to the United States by this invasion of her territory, so wholly irreconcilable with her rights as an independent power, has yet been made. In the view taken by this government, the inquiry whether the vessel was in the employment of those who were prosecuting an unauthorized war against that Province, or was engaged by the owner in the business of transporting passengers to and from Navy Island in hopes of private gain, which was most probably the case, in no degree alters the real question at issue between the two governments. This government can never concede to any foreign government the power, except in a case of the most urgent and extreme necessity, of invading its territory, either to arrest the persons or destroy the property of those who may have violated the municipal laws of such foreign government, or have disregarded their obligations arising under the law of nations. The territory of the United States must be regarded as sacredly secure against all such invasions, until they shall voluntarily acknowledge their inability to aquit themselves of their duties to others. And in announcing this sentiment, I do but affirm a principle which no nation on earth would be more ready to vindicate, at all hazards, than the people and government of

the remainder of the authorized loan, amounting to $6,500,000. Secondly, the re-issue of the five millions of treasury notes authorized at the previous session. Thirdly, the remainder ($2,718,570) to be made up by additional duties on imported articles. While recommending these fourteen millions and a quarter to be raised by loans, treasury notes, and duties, the President recommended the land revenue should still remain as a fund for distribution to the States, and was solicitous that, in the imposition of new duties, care should be taken not to impair the mutual assurance for each other's life which the land distribution bill, and the compromise clause contained in the tariff bill of the extra session provided for each other-saying: "It might be esteemed desirable that no such augmentation of the duties should take place as would have the effect of annulling the land proceeds distribution act of the last session, which act it declared to be inoperative the moment the duties are increased beyond 20 per centum—the maximum rate established by the compromise act." This recommendation, so far as it applied to the compromise act, was homage to the dead; and so far as it related to continuing the distribution of the land revenue was, probably, the first instance in the annals of nations in which the chief magistrate of a country has recommended the diversion and gratuitous distribution of a large branch of its reVenues, recommending at the same time, money to be raised by loans, taxes, and government notes to supply the place of that given away. The largeness of the deficiency was a point to be accounted for; and that was done by showing the great additional expenses to be incurred -and especially in the navy, for which the new secretary (Mr. Upshur) estimated enorThe finances were in a bad condition, and the President chiefly referred to the report of the Sec-cussion in Congress of which, in its place. mously, and gave rise to much searching disretary of the Treasury upon them. Of the loan But the chief item in the message was another of twelve millions authorized at the previous ses-modification of the fiscalities of the extra session, only five millions and a half had been taken -being the first instance, and the last in our financial history in which, in time of peace, our government was unable to borrow money. A deficiency existed in the revenues of the year, and for the ensuing year that deficiency was estimated, would amount to a fraction over fourteen millions of dollars. To meet this large deficit the secretary recommended-first, an

Great Britain."

sion, with a new name, and an old countenance upon it, except where it was altered for the worse. This new plan was thus introduced by the President:

"In pursuance of a pledge given to you in my last message to Congress, which pledge I urge as an apology for adventuring to present you the details of any plan, the Secretary of the Treasury will be ready to submit to you, should

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