So much for these corporation exemptions in England; and if the senator from Massachusetts finds any thing in such instances worthy of imitation, let him stand forth and proclaim it. was affirmed by the Court of King's Bench; the last gasp. but this happened to take place in the reign of Charles II.-that reign during which so little is found worthy of imitation in the government of Great Britain-and immediately two acts of Parliament were passed, one to annul the judgment of the Court of King's Bench in the case of Sir John Wolstenholme, and the other to prevent any such judgments from being given in future. Here are copies of the two acts: FIRST ACT, TO ANNUL THE JUDGMENT. "Whereas a verdict and judgment was had in the Easter term of the King's Bench, whereby Sir John Wolstenholme, knight, and adventurer in the East India Company, was found liable to a commission of bankrupt only for, and by reason of, a share which he had in the joint stock of said company: Now, &c., Be it enacted, That the said judgment be reversed, annulled, vacated, and for naught held," &c. SECOND ACT, TO PREVENT SUCH JUDGMENTS IN FUTURE. "That whereas divers noblemen and gentlemen, and persons of quality, no ways bred up to trade, do often put in great stocks of money into the East India and Guinea Company: Be it enacted, That no persons adventurers for putting in money or merchandise into the said companies, or for venturing or managing the fishing trade, called the royal fishing trade, shall be reputed or taken to be a merchant or trader within any statutes for bankrupts." Thus, and for these reasons, were chartered companies and their members exempted from the bankrupt penalties, under the dissolute reign of Charles II. It was not the power of the corporations at that time-for the Bank of England was not then chartered, and the East India Company had not then conquered India-which occasioned this exemption; but it was to favor the dignified characters who engaged in the trade—noblemen, gentlemen, and persons of quality. But, afterwards, when the Bank of England had become almost the government of England, and when the East India Company had acquired the dominions of the Great Mogul, an act of Parliament expressly declared that no member of any incorporated company, chartered by act of Parliament, should be liable to become bankrupt. This act was passed in the reign of George IV., when the Wellington ministry was in power, and when liberal principles and human rights were at But, sir, I am not yet done with my answer to this question; do such laws ordinarily extend to corporations at all? I answer, most decidedly, that they do! that they apply in England to all the corporations, except those specially excepted by the act of George IV.; and these are few in number, though great in power -powerful, but few-nothing but units to myriads, compared to those which are not excepted. The words of that act are: "Members of, or subscribers to, any incorporated commercial or trading companies, established by charter act of Parliament." These words cut off at once the many ten thousand corporations in the British empire existing by prescription, or incorporated by letters patent from the king; and then they cut off all those even chartered by act of Parliament which are not commercial or trading in their nature. This saves but a few out of the hundreds of thousands of corporations which abound in England, Scotland, Wales, and Ireland. It saves, or rather confirms, the exemption of the Bank of England, which is a trader in money; and it confirms, also, the exemption of the East India Company, which is, in contemplation of law at least, a commercial company; and it saves or exempts a few others deriving charters of incorporation from Parliament; but it leaves subject to the law the whole wilderness of corporations, of which there are thousands in London alone, which derive from prescription or letters patent; and it also leaves subject to the same laws all the corporations created by charter act of Parliament, which are not commercial or trading. The words of the act are very peculiar—“ charter act of Parliament;" so that corporations by a general law, without a special charter act, are not included in the exemption. This answer, added to what has been previously said, must be a sufficient reply to the senator's question, whether bankrupt laws ordinarily extend to corporations? Sir, out of the myriad of corporations in Great Britain, the bankrupt law extends to the whole, except some half dozen or dozen. So much for the exemption of these corpora We "In 1814-15, and '16, no fewer than 240 country banks stopped payment, and ninety-two commissions of bankruptcy were issued against these establishments, being at the rate of one commission against every seven and a half of the total number of country banks existing in 1813." tions in England; now for our America. never had but one bankrupt law in the United States, and that for the short period of three or four years. It was passed under the administration of the elder Mr. Adams, and repealed under Mr. Jefferson. It copied the English acts including among the subjects of bankruptcy, Two hundred and forty stopped payment at bankers, brokers, and factors. Corporations one dash, and ninety-two subjected to commiswere not included; and it is probable that no sions of bankruptcy. They were not indeed question was raised about them, as, up to that chartered banks, for there are none such in Engtime, their number was few, and their conduct land, except the Bank of England; but they generally good. But, at a later date, the enact- were legalized establishments, existing under the ment of a bankrupt law was again attempted in first joint-stock bank act of 1708; and they were our Congress; and, at that period, the multipli- banks of issue. Yet they were subjected to the cation and the misconduct of banks presented | bankrupt laws, ninety-two of them in a single them to the minds of many as proper subjects season of bank catalepsy; their broken "promfor the application of the law; I speak of the ises to pay were taken out of circulation; their bill of 1827, brought into the Senate, and lost. doors closed; their directors and officers turned That bill, like all previous laws since the time out; their whole effects, real and personal, their of George II., was made applicable to bankers, money, debts, books, paper, and every thing, put brokers, and factors. A senator from North into the hands of assignees; and to these asCarolina [Mr. BRANCH] moved to include bank- signees, the holders of their notes forwarded ing corporations. The motion was lost, there their demands, and were paid, every one in being but twelve votes for it; but in this twelve equal proportion-as the debts of the bank were there were some whose names must carry weight collected, and its effects converted into money; to any cause to which they are attached. The and this without expense or trouble to any one twelve were, Messrs. Barton, Benton, Branch, of them. Ninety-two banks in England shared Cobb, Dickerson, Hendricks, Macon, Noble, Ran- this fate in a single season of bank mortality; dolph, Reed, Smith of South Carolina, and White. | five hundred more could be enumerated in other The whole of the friends of the bill, twenty-one seasons, many of them superior in real capital, in number, voted against the proposition, (the credit, and circulation, to our famous chartered present Chief Magistrate in the number,) and banks, most of which are banks of moonshine, for the obvious reason, with some, of not encum- built upon each other's paper; and the whole bering the measure they were so anxious to ready to fly sky-high the moment any one of carry, by putting into it a new and untried pro- the concern becomes sufficiently inflated to vision. And thus stands our own legislation on burst. The immediate effect of this application this subject. In point of fact, then, chartered of the bankrupt laws to banks in England, is corporations have thus far escaped bankrupt two-fold: first, to save the general currency penalties, both in England, and in our America; from depreciation, by stopping the issue and but ought they to continue to escape? This is circulation of irredeemable notes; secondly, to the question—this the true and important in- do equal justice to all creditors, high and low, quiry, which is now to occupy the public mind. rich and poor, present and absent, the widow The senator from Massachusetts [Mr. WEB- and the orphan, as well as the cunning and the STER] says the object of bankrupt laws has no powerful, by distributing their effects in proporrelation to currency; that their object is sim- tionate amounts to all who hold demands. This ply to distribute the effects of insolvent debtors is the operation of bankrupt laws upon banks in among their creditors. So says the senator, but England, and all over the British empire; and it what says history? What says the practice of happens to be the precise check upon the issue Great Britain? I will show you what it says, of broken bank paper, and the precise remedy and for that purpose will read a passage from for the injured holders of their dishonored paper McCulloch's notes on Smith's Wealth of Nations. which the President recommends. Here is his He says: recommendation, listen to it: "In the mean time, it is our duty to provide States. They perform the same functions, and all the remedies against a depreciated paper cur- differ in name only; not in substance nor in rency which the constitution enables us to af- conduct. They have no charters, but they have ford. The Treasury Department, on several former occasions, has suggested the propriety a legalized existence; they are not corporations, and importance of a uniform law concerning but they are allowed by law to act in a body; bankruptcies of corporations and other bankers. they furnish the actual paper currency of the Through the instrumentality of such a law, a salutary check may doubtless be imposed on the great body of the people of the British empire, issues of paper money, and an effectual remedy as much so as our local banks furnish the mass given to the citizen, in a way at once equal in of paper currency to the people of the United all parts of the Union, and fully authorized by States. They have had twenty-four millions the constitution." sterling (one hundred and twenty millions of dollars) in circulation at one time; a sum near United States; and more than equal to the whole bank-note circulation of the present day. They are all subject to the law of bankruptcy, and their twenty-four millions sterling of currency along with them; and five hundred of them have been shut up and wound up under commissions of bankruptcy in the last forty years; and yet the senator from Massachusetts informs us that the object of bankrupt laws has no relation to currency! The senator from Massachusetts says he would not, intentionally, do injustice to the mes-ly equal to the greatest issue ever known in the sage or its author; and doubtless he is not conscious of violating that benevolent determination; but here is injustice, both to the message and to its author; injustice în not quoting the message as it is, and showing that it proposes a remedy to the citizen, as well as a check upon insolvent issues; injustice to the author in denying that the object of bankrupt laws has any relation to currency, when history shows that these laws are the actual instrument for regulating and purifying the whole local paper currency of the entire British empire, and saving that country from the frauds, losses, impositions, and demoralization of an irredeemable paper money. The senator from Massachusetts says the object of bankrupt laws has no relation to currency. If he means hard-money currency, I agree with him; but if he means bank notes, as I am sure he does, then I point him to the British bankrupt code, which applies to every bank of issue in the British empire, except the Bank of England itself, and the few others, four or five in number, which are incorporated by charter acts. All the joint-stock banks, all the private banks, all the bankers of England, Scotland, Wales, and Ireland, are subject to the law of bankruptcy. Many of these establishments are of great capital and credit; some having hundreds, or even thousands of partners; and many of them having ten, or twenty, or thirty, and some even forty branches. They are almost the exclusive furnishers of the local and common bank note currency; the Bank of England notes being chiefly used in the great cities for large mercantile and Government payments. These joint-stock banks, private companies, and individual bankers are, practically, in the British empire what the local banks are in the United But it is not necessary to go all the way to England to find bankrupt laws having relation to currency. The act passed in our own country, about forty years ago, applied to bankers; the bill brought into the House of Representatives, about fifteen years ago, by a gentleman then, and now, a representative from the city of Philadelphia, [Mr. SERGEANT,] also applied to bankers; and the bill brought into this Senate, ten years ago, by a senator from South Carolina, not now a member of this body, [General HAYNE,] still applied to bankers. These bankers, of whom there were many in the United States, and of whom Girard, in the East, and Yeatman and Woods, in the West, were the most considerable-these bankers all issued paper money; they all issued currency. The act, then, of 1798, if it had continued in force, or the two bills just referred to, if they had become law, would have operated upon these bankers and their banks-would have stopped their issues, and put their establishments into the hands of assignees, and distributed their effects among their creditors. This, certainly, would have been having some relation to currency: so that, even with our limited essays towards a bankrupt system, we have scaled the outworks of the banking empire; we have laid hold of bankers, but not of banks the constitutional money, and to force their own paper upon the community, and then to redeem it or not, as they please. And is it to be tolerated, that, in addition to all these privileges, and all these powers, they are to be exempted from the law of bankruptcy? the only law of which they are afraid, and the only one which can protect the country against their insolvent issues, and give a fair chance for payment to the numerous holders of their violated "promises to pay!" we have reached the bank of Girard, but not the Girard Bank; we have applied our law to the bank of Yeatman and Woods, but not to the rabble of petty corporations which have not the tithe of their capital and credit. We have gone as far as bankers, but not as far as banks; and now give me a reason for the difference. Give me a reason why the act of 1798, the bill of Mr. SERGEANT, in 1821, and the bill of General HAYNE, in 1827, should not include banks as well as bankers. They both perform the same function-that of issuing paper currency. I have discussed, Mr. President, the right of They both involve the same mischief when Congress to apply a bankrupt law to banking they stop payment-that of afflicting the coun- corporations; I have discussed it on the words try with a circulation of irredeemable and de- of our own constitution, on the practice of preciated paper money. They are both culpa- England, and on the general authority of Parble in the same mode, and in the same degree; liament; and on each and every ground, as I for they are both violators of their "promises fully believe, vindicated our right to pass the to pay." They both exact a general credit law. The right is clear; the expediency is manifrom the community, and they both abuse that fest and glaring. Of all the objects upon the credit. They both have creditors, and they earth, banks of circulation are the fittest subboth have effects; and these creditors have as jects of bankrupt laws. They act in secret, much right to a pro rata distribution of the and they exact a general credit. Nobody effects in one case as in the other. Why, then, knows their means, yet every body must trust a distinction in favor of the bank? Is it be- them. They send their "promises to pay" far cause corporate bodies are superior to natural and near. They push them into every body's bodies? because artificial beings are superior hands; they make them small to go into small to natural beings? or, rather, is it not because hands-into the hands of the laborer, the corporations are assemblages of men; and as- widow, the helpless, the ignorant. Suddenly semblages are more powerful than single men; the bank stops payment; all these helpless and, therefore, these corporations, in addition holders of their notes are without pay, and to all their vast privileges, are also to have the without remedy. A few on the spot get a litprivilege of being bankrupt, and afflicting the tle; those at a distance get nothing. For each country with the evils of bankruptcy, without to sue, is a vexatious and a losing business. themselves being subjected to the laws of bank- The only adequate remedy-the only one that ruptcy? Be this as it may-be the cause what promises any justice to the body of the comit will the decree has gone forth for the deci-munity, and the helpless holders of small notes sion of the question-for the trial of the issue is the bankrupt remedy of assignees to dis-for the verdict and judgment upon the claim tribute the effects. This makes the real effects of the banks. They have many privileges and available. When a bank stops, it has little or exemptions now, and they have the benefit of no specie; but it has, or ought to have, a good all laws against the community. They pay no mass of solvent debts. At present, all these taxes; the property of the stockholders is not debts are unavailable to the community-they liable for their debts; they sue their debtors, go to a few large and favored creditors; and sell their property, and put their bodies in jail. those who are most in need get nothing. But They have the privilege of stamping paper a stronger view remains to be taken of these money; the privilege of taking interest upon debts: the mass of them are due from the owndouble, treble, and quadruple their actualers and managers of the banks-from the presmoney. They put up and put down the price idents, directors, cashiers, stockholders, attorof property, labor, and produce, as they please. neys; and these people do not make themThey have the monopoly of making the actual selves pay. They do not sue themselves, nor currency. They are strong enough to suppress protest themselves. They sue and protest others, and sell out their property, and put their bodies in jail; but, as for themselves, who are the main debtors, it is another affair! They take their time, and usually wait till the notes are heavily depreciated, and then square off with a few cents in the dollar! A commission of bankruptcy is the remedy for this evil; assignees of the effects of the bank are the persons to make these owners, and managers, and chief debtors to the institutions, pay up. Under the bankrupt law, every holder of a note, no matter how small in amount, nor how distant the holder may reside, on forwarding the note to the assignees, will receive his ratable proportion of the bank's effects, without expense, and without trouble to himself. It is a most potent, a most proper, and most constitutional remedy against delinquent banks. It is an equitable and a brave remedy. It does honor to the President who recommended it, and is worthy of the successor of Jackson. the day for such law to take effect, will be the day for the resumption of specie payments by every solvent bank, and the day for the extinction of the abused privileges of every insolvent one. So far from requiring the impotent aid of the miscalled Bank of the United States to effect a resumption, that institution will be unable to prevent a resumption. Its veto power over other banks will cease; and it will itself be compelled to resume specie payment, or die! Besides these great objects to be attained by the application of a bankrupt law to banking corporations, there are other great purposes to be accomplished, and some most sacred duties to be fulfilled, by the same means. Our constitution contains three most vital prohibitions, of which the federal government is the guardian and the guarantee, and which are now publicly trodden under foot. No State shall emit bills of credit; no State shall make any thing but gold and silver coin a tender in payment of debts; no State shall pass any law impairing the obligation of contracts. No State shall do these things. So says the constitution under which we live, and which it is the duty of every citizen to protect, preserve, and defend. But a new power has sprung up among us, and has annulled the whole of these prohibitions. That new power is the oligarchy of banks. It has filled the whole land with bills of credit; for it is admitted on all hands that bank notes, not convertible into specie, are bills of credit. It has suppressed the constitutional currency, and made depreciated paper money a forced Senators upon this floor have ventured the expression of an opinion that there can be no resumption of spccie payments in this country until a national bank shall be established, meaning, all the while, until the present miscalled Bank of the United States shall be rechartered. Such an opinion is humiliating to this government, and a reproach upon the memory of its founders. It is tantamount to a declaration that the government, framed by the heroes and sages of the Revolution, is incapable of selfpreservation; that it is a miserable image of imbecility, and must take refuge in the embraces of a moneyed corporation, to enable it to sur-tender in payment of every debt. It has viovive its infirmities. The humiliation of such a thought should expel it from the imagination of every patriotic mind. Nothing but a dire necessity-a last, a sole, an only alternativeshould bring this government to the thought of leaning upon any extraneous aid. But here is no necessity, no reason, no pretext, no excuse, no apology, for resorting to collateral aid; and, above all, to the aid of a master in the shape of a national bank. The granted powers of the government are adequate to the coercion of all the banks. As banks, the federal government has no direct authority over them; but as bankrupts, it has them in its own hands. It can pass bankrupt laws for these delinquent institutions. It can pass such laws either with or without including merchants and traders; and lated all its own contracts, and compelled all individuals, and the federal government and State governments, to violate theirs; and has obtained from sovereign States an express sanction, or a silent acquiescence, in this double violation of sacred obligations, and in this triple annulment of constitutional prohibitions. It is our duty to bring, or to try to bring, this new power under subordination to the laws and the government. It is our duty to go to the succor of the constitution-to rescue, if possible, these prohibitions from daily, and public, and permanent infraction. The application of the bankrupt law to this new power, is the way to effect this rescue-the way to cause these vital prohibitions to be respected and observed, and to do it in a way to prevent collisions between |