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nity with a degree of violence scarcely inferior to that of a stag-
nation of the blood in the human body, hurrying the wretched
merchant who hath debts to pay into the hands of griping usurers;
that the directors of the Bank may give such preference in trade,
by advances of money to their particular favourites, as to destroy
that equality which ought to prevail in a commercial country ;
that paper money has often proved beneficial to the State, but the
Bank forbids it, and the people must acquiesce : therefore, and in
order to restore public confidence and private security, they pray
that a bill may be brought in and passed into a law for repealing the
law for incorporating the Bank*


themselves of the situation of its affairs, how they were
conducted, what aids it had rendered the public cause, or
whether any ; nor do the committee produce in their report
a single fact or circumstance to shew they made any inquiry
at all, or whether the rumours then circulated were true or
false; but content themselves with modelling the insinua-
tions of the petitions into a report, and giving an opinion

It would appear from the report, that the committee
either conceived that the house had already determined how
it would act without regard to the case, and that they were
only a committee for form sake, and to give a colour of
inquiry without making any, or that the case was referred
to them, as law questions are sometimes referred to law-
officers, for an opinion ojily.

March 28.

The report of the committee, read March 25, on the petitions
from the counties of Chester and Berks, and the city of Phila-
delphia, and its vicinity, praying the act of assembly, whereby the
Bank was established at Philadelphia, may be repealed, was read
the second time as follows, viz.

The committee to whom were referred the petitions concerning
the Bank established at Philadelphia, and who were instructed to
inquire whether the said Bank be compatible with the public
safety, and that equality which ought ever to prevail between the
individuals of a republic, beg leave to report, that it is the opinion
of this committee, that the said Bank, as at present established, is
in every view incompatible with the public safety ; that in the pre-
sent state of our trade, the said Bank has a direct tendency to ba-
nish a great part of the specie from the country, so as to produce
a scarcity of money, and to collect into the hands of the stock-
holders of the said Bank almost the whole of the money which re-
mains amongst us. That the accumulation of enormous wealth in
the hands of a society, who claim perpetual duration, will neces-
sarily produce a degree of influence and power, which cannot be
entrusted in the hands of any set of men whatsoever without en-
dangering the public safety. That the said Bank, in its corporate
capacity, is empowered to hold estates to the amount of ten mil-
lions of dollars, and by the tenor of the present charter, is to exist
for ever, without being obliged to yield any emolument to the
Government, or to he at all dependant upon it. That the great
profits of the Bank, which will daily increase as money grows
scarcer, and which already far exceed the profits of European
Banks, have tempted foreigners to vest their money in this Bank,
and thus to draw from us large sums for interest.


This method of doing public business serves exceedingly

to mislead a country. When the constituents of % an

assembly hear that an inquiry into any matter is directed to
be made, and a committee appointed for that purpose, they
naturally conclude that the inquiry is made, and that the
future proceedings of the house are in consequence of the
matters, facts, and information obtained by means of that

inquiry. But here is a committee of inquiry making no

inquiry at all, and giving an opinion on a case without
inquiring into it. This proceeding of the committee would
justify an opinion that it was not their wish to get, but to
get over information, and lest the inquiry should not suit
their wishes, omitted to make any. The subsequent con-
duct to the house, in resolving not to hear the directors of
the Bank on their application for that purpose, prior to the

That foreigners will doubtless be more and more induced to be-
come stockholders, until the time may arrive when this enormous
engine of power ma}' become subject to foreign influence; this
country may be agitated with the politics of European courts, and
the good People of America reduced once moie into a state of sub-
ordination, and dependence upon some one or the other of the
European powers. That at best, if it were even confined to the
hands of Americans, it would be totally destructive of that equality
which ought to prevail in a republic. We have nothing in our free
and equal Government capable of balancing the influence which
this Bank must create; and we see nothing which in the course of
a few years, can prevent the directors of the Bank, from governing
Pennsylvania. Already we have felt its influence indirectly inter-
fering in the measures of the legislature. Already the House of
Assembly, the representatives of the people, have been threatened,
that the credit of our paper-currency will be blasted by the Bank ;
and if this growing evil continues we fear the time is not very dis-
tant, when the Bank will be able to dictate to the legislature, what
laws to pass and what to forbear.

Your committee tlrerefore beg leave farther to report the follow-
ing resolution to be adopted by the house, viz.

RESOLVED, that a committee be appointed to bring in a bill to
repeal the act of assembly, passed the first day of April, 1782, en-
titled, " An act to incorporate the subscribers to the Bank of North
America;" and also to repeal one other act of assembly, passed
the 18th of March, 1782, entitled, " An act for preventing and
punishing the counterfeiting of the common seal, bank-bills
and bank-notes of the president, directors and company, of the
Bank of North America, and for the other purposes therein men-


publication of the bill for the consideration of the people,
strongly corroborates this opinion : for why should not the
house hear them, unless it was apprehensive, that the Bank,
by such a public opportunity, would produce proofs of its
services and usefulness, that would not suit the^temper and
views of its opposers ?

But if the house did not wish or choose to hear the de-
fence of the Bank, it was no reason their constituents should
not. The constitution of this State, in lieu of having two
branches of legislature, has substituted, that " To the end
that laws before they are enacted may be more maturely
considered, and the inconvenience of hasty determinations as
much as possible prevented, all bills of a public nature

shall be printed for the consideration of the people."*

The people, therefore, according to the constitution, stand
in the place of another house ; or, more properly speaking,
are a house in their own right : But in this instance, the
assembly arrogates the whole power to itself, and places
itself as a bar to stop the necessary information spreading
among the people. The application of the Bank to be
heard before the bill was published for public consideration,
had two objects. First, to the house, and secondly, through
the house to the people, who are as another house. It was
as a defence in the first instance, and as an appeal in the
second. But the assembly absorbs the right of the people
to judge ; because, by refusing to hear the defence, they
barred the appeal. Were there no other cause which the
constituents of that assembly had for censuring its conduct
than the exceeding unfairness, partiality, and arbitrariness
with which this business was transacted, it would be cause

Let the constituents of assemblies differ, as they may,
respecting certain peculiarities in the form of the constitu-
tion, they will all agree in supporting its principles, and in
reprobating unfair proceedings and .despotic measures.
Every constituent is a member of the republic, which is a
station of more consequence to him than being a member
of a party, and though they may differ from each other in
their choice of persons to transact the public business, it is
of equal importance to all parties that the business be done
on right principles : otherwise our laws and acts, instead of
being founded in justice, will be founded in party, and be

* Constitution, section the 1 5th.


laws and acts of retaliation : and instead of being a republic
of free citizens, we shall be alternately tyrants and slaves.
But to return to the report.

The report begins by stating, that " The committee to
whom were referred the petitions concerning the Bank es-
tablished at Philadelphia, and who were instructed to in-
quire whether the said Bank be compatible with the public
safety, and that equality which ought ever to prevail be-
tween the individuals of a republic, beg leave to report
(not that they have made any inquiry, but) that it is the
opinion of this committee, that the said Bank, as at present
established, is, in every view, incompatible with the public
safety." But why is it so ? Here is an opinion unfounded
and unwarranted. The committee have begun their report
at the wrong end ; for an opinion, when given as a matter
of judgment, is an action of the mind which follows a fact,
but here it is put in the room of one.

The report then says, ' That in the present state of our
trade, the said Bank has a direct tendency to banish a great
part of the specie from the country, and to collect into the
hands of the stockholders of the Bank almost the whole of
the money which remains among us."

Here is another mere assertion, just like the former, with-
out a single fact or circumstance to shew why it is made
or whereon it is founded. Now the very reverse, of what
the committee asserts, is the natural consequence of a Bank.

Specie may be called the stock in trade of the Bank, it

is therefore its interest to prevent it from wandering out of
the country, and to keep a constant standing supply to be
ready for all domestic occasions and demands. Were it true
that the Bank has a direct tendency to banish the specie
from the country, there would soon be an end to the Bank ;
and, therefore, the committee have so far mistaken the mat-
ter, as to put their fears in the place of their wishes : for if it
is to happen as the committee states, let the Bank alone and
it will cease of itself, and the repealing act need not have
been passed.

It is the interest of the Bank that people should keep
their cash there, and all commercial countries find the ex-
ceeding great convenience of having a general repository for
their cash. But so far from banishing it, there are no
two classes of people in America who are so much interest-
ed in preserving hard money in the country as the Bank and
the merchant. Neither of them can carry on their business
without it. Their opposition to the paper-money of the


late assembly was because it has a direct effect, as far as it
is able, to banish the specie and that without providing any
means for bringing more in.

The committee must have been aware of this, and there-
fore chose to spread the first alarm, and groundless as it was,
to trust to the delusion.

As the keeping the specie in the country is the interest of
the Bank, so it has the best opportunities of preventing its
being sent away, and the earliest knowledge of such a design.
While the Bank is the general depository of cash, no great
sums can be obtained without getting it from thence, and as
it is evidently prejudicial to its interest to advance money to
be sent abroad, because in this case, the money cannot by
circulation return again ; the Bank, therefore, is interested in
preventing what the committee would have it suspected of

It is to prevent the exportation of cash and to retain it in
the country that the Bank has on several occasions stopped
the discounting notes till the danger has been passed.^ The

* The petitions say, " That they have repeatedly seen the stop-
ping of discounts at the Bank, operating- on the trading part of
the community, with a degree of violence scarcely inferior to that
of a stagnation of the blood in the human body, hurrying the
wretched merchant who hath debts to pay into the hands of griping

As the persons who say or signed this, live somewhere in Chester
county, they are not, from situation, certain of what they say,
Those petitions have every appearance of being contrived lor the
purpose of bringing the matter on. The petition and the report
have strong evidence in them of being both drawn up by the same
person ; for the report is as clearly the echo of the petition as ever
the address of the British Parliament was the echo of the King's

Besides the reason I have already given for occasionally stopping
discounting notes at the B;iuk, there are other necessary reasons.
It is for the purpose of settling accounts. Short reckonings make
long friends. The Bank lends its money for short periods, and by
that means assists a great many different people, and if it did not
sometimes stop discounting, as a means of settling with persons it
has already lent its money to, those persons would find a way to
keep what they had borrewed longer than they ought, and prevent
others being assisted. It i* a fact, and some of the committee know
it to be so, that sundry of those persons who then opposed the iBank
acted this part.

The stopping the discounts do not, and c;Hinot, operate to call


first part, therefore, of the assertion, that of banishing the
specie, contains an apprehension as needless as it is ground-
less, and which, had the committee understood, or been the
least informed of, the nature of a Bank, they could not have
made. It is very probable that some of the opposers to the
Bank are those persons who have been disappointed in their
attempt to obtain specie for this purpose, and now cloak
their opposition under other pretences.

I now come to the second part of the assertion, which is,
that when the Bank has banished a great part of the specie
from the country, "it will collect into the hands of the
stockholders almost the whole of the money which remains
among us." But how, or by what means, the Bank is to
accomplish this wonderful feat, the committee have not
informed us. Whether people are to give their money to
the Bank for nothing, or whether the Bank is to charm it
from them as a rattle-snake charms a squirrel from a tree,
the committee have left us as much in the dark about it as
they were themselves.

Is it possible the committee should know so very little of
the matter, as not to know that no part of the money which
at any time may be in the Bank belongs to the stock-
holders? not even the original capital which they put in is
any part of it their own, until every person who has a de-
mand upon the Bank is paid, and if there is not a sufficiency
for this purpose, on the balance of loss and gain, the original
money of the stockholders must make up the deficiency.

The money which at any time may be in the Bank is the
property of every man who holds a bank-note, or deposits
cash there, or who has a just demand upon it from the city
of Philadelphia np to Fort Pitt, or to any part of the United
States; and he can draw the money from it when he
pleases. Its being in the Bank, does not in the least make
it the property of the stockholders, any more than the
money in the State treasury is the property of the State

in the loans sootier than the time for which they were lent, and
therefore the charge is false, that "it hurries men into the hands of
griping usurers:" and the truth is, that it operates to keep them
from thence.

If petitions are to be contrived to cover the designs of a house of
assembly, and give a pretence for its conduct, or if a house is to be
led by the nose by the idle tale of any fifty or sixty signers to a
petition, it is time for the public to look "a little closer into the
conduct of its representatives.


treasurer. They are only stewards over it for those who
please to put it, or let it remain there ; and, therefore, this
second part of the assertion is somewhat ridiculous.

The next paragraph in the report is, " that the accumula-
tion of enormous wealth in the hands of a society who claim
perpetual duration, will necessarily produce a degree of
influence and power which cannot be entrusted in the hands
of any set of men whatsoever, (the committee I presume

excepted) without endangering the public safety."-

There is an air of solemn fear in this paragraph which is
something like introducing a ghost in a play to keep people
from laughing at the players.

I have already shewn that whatever wealth there may be,
at any time in the Bank, is the property of those who have
demands upon the Bank, and not the property of the stock-
holders. As a society, they hold no property, and most
probably never will, unless it should be a house to transact
their business in, instead of hiring one. Every half year
the Bank settles its accounts, and each individual stock-
holder takes his dividend of gain or loss to himself, and
the Bank begins the next half year in the same manner it
began the first, and so on. This being the nature of a Bank,
there can be no accumulation of wealth among them as a

For what purpose the word " society" is introduced into
the report I do not know, unless it be to make a false im-
pression upon people's minds. It has no connection with
the subject, for the Bank is not a society, but a company,
and denominated so in the charter. There are several reli-
gious societies incorporated in this State, which hold pro-
perty as the right of those societies, and to which no person
can belong that is not of the same religious profession. But
this is not the case with the Bank. The Bank is a company
for the promotion and convenience of commerce, which is
a matter in which all the State is interested, and holds no
property in the manner which those societies do.

But there is a direct contradiction in this paragraph to
that which goes before it. The committee, there, accuses
the Bank of banishing the specie, and here, of accumulating
enormous sums of it. So here are two enormous sums of
specie; one enormous sum going out, and another enormous
sum remaining. To reconcile this contradiction, the com-
mittee should have added to their report, that they suspected
the Bank had found out the philosophers sione^ and kept it
a secret.


The next paragraph is, " that the said Bank, in ita corpo-
rate capacity, is empowered to hold estates to the amount
of ten millions of dollars, and by the tenor of the present
charter is to exist for ever, without being obliged to yield
any emolument to the government, or be at least dependant
on it."

The committee have gone so vehemently into this busi-
ness, and so completely shewn their want of knowledge in
every point of it, as to make, in the first part of this para-
graph, a fear of what, the greater fear is, will never happen.
Had the committee known any thing of banking, they must
have known, that the objection against banks has been (not
that they held great estates, but) that they held none; that
they had no real, fixed, and visible property, and that it is
the maxim and practice of banks not to hold any.

The Honourable Chancellor Livingston, late secretary [for
foreign affairs, did me the honour of shewing, and discours-
ing with me, on a plan of a Bank he had drawn up for the
State of New York. In this plan it was made a condition
or obligation, that whatever the capital of the Bank amount-
ed to in specie, there should be added twice as much in
real estates. But the mercantile interest rejected the pro-

It was a very good piece of policy in the assembly which
passed the charter act, to add the clause to empower the
Bank to purchase and hold real estates. It was as an in-
ducement to the Bank to do it, because such estates, being
held as the property of the Bank, would be so many
mortgages to the public in addition to the money capital of
the Bank.

But the doubt is that the Bank will not be induced to ac-
cept the opportunity. The Bank has existed five years and
has not purchased a shilling of real property : and as such
property or estates cannot be purchased by the Bank but
with the interest money which the stock produces, and as
that is divided every half year among the stockholders, and
each stockholder chooses to have the management of his
own dividend, and if he lays it out in purchasing an estate
to have that estate his own private property, and under
his own immediate management, there is no expecta-
tion, so far from being any fear, that the clause will be

Where knowledge is a duty, ignorance is a crime; and
the committee are criminal in not understanding this subject


better. Had this clause not been in the charter, the com-
mittee might have reported the want of it as a defect, in
not empowering the Bank to hold estates as a real security
to its creditors: but as the complaint now stands, the accu-
sation of it is, that the charter empowers the Bank to give
real security to its creditors. A complaint never made,
heard of, or thought of before.

The second article in the paragraph is, " that the Bank,
according to the tenor of the present charter, is to exist for

ever." Here I agree with the committee, and am

glad to find that among such a list of errors and contradic-
tions there is one idea which is not wrong, although the
committee have made a wrong use of it.

As we are not to live for ever ourselves, and other gene-
rations are to follow us, we have neither the power nor the
right to govern them, or to say how they shall govern them-
selves. It is the summit of human vanity, and shews a
covetousness of power beyond the grave, to be dictating to
the world to come. It is sufficient that we do that which is
right in our own day, and leave them with the advantage of
good examples.

As the generations of the world are every day both com-
mencing and expiring, therefore, when any public act of
this sort is done, it naturally supposes the age of that gene-
ration to be then beginning, and the time contained between
coming of age, and the natural end of life, in the extent of
time it has a right to gp to, which may be about thirty
years; for though many may die before, others will live be-
yond; and the mean time is equally fair for all generations.

If it was made an article in the constitution, that all
laws and acts should cease of themselves in thirty years,
and have no legal force beyond that time, it would prevent
their becoming too numerous and voluminous, and serve to
keep them within view, and in a compact compass. Such
as were proper to be continued, would be enacted again,
and those which were not, would go into oblivion. There
is the same propriety that a nation should fix a time for a
full settlement of its affairs, and begin again from a new
date, as that an individual should; and to keep within the
distance of thirty years would be a convenient period.

The British, from the want of some general regulation of
this kind, have a great number of obsolete Jaws; which,
though out of use and forgot, are not out of force, and are
occasionally brought up for sharping purposes, and innocent
unwarv persons trepanned thereby.


To extend this idea still farther, it would probably be a
considerable improvement in the political system of nations,
to make all treaties of peace for a limited time. It is the
nature of the mind to feel uneasy under the idea of a con-
dition perpetually existing over it, and to excite in itself
apprehensions that would not take place were it not from
that cause.

Were treaties of peace made for, and renewable every
seven or ten years, the natural effect would be, to make
peace continue longer than it does under the custom of
making peace for ever. If the parties felt or apprehended
any inconveniences under the terms already made, they
would look forward to the time when they should be even-
tually relieved therefrom, and might renew the treaty on im-

Online LibraryThomas PaineThe political and miscellaneous works of Thomas Paine .. (Volume 1) → online text (page 38 of 65)