passed the senate at the last session. On the 12th of December, he accordingly introduced the bill, which being referred to the committee on public lands, on the 3d of January, Mr. Kane reported from this committee an amendment substituting instead of Mr. Clay's bill, a new bill, reducing the price of public lands to dollar per acre, and to fifty cents, to actual settlers. Mr. Clay moved, upon the coming in of the report, that it be made the order of the day, for the 7th of January, when the subject was taken up.

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Mr. Kane, Mr. Buckner, Mr. Black, Mr. Grundy, Mr. Hill, Mr. Moore and Mr. Benton, spoke in opposition to Mr. Clay's bill, and were replied to by Mr. Clay, Mr. Bibb, Mr. Poindexter and Mr. Ewing.

The opponents of the bill contended that the new states were not on an equality with the old; that they were kept down by one great landholder whose property was not subject to taxation for roads, education, and other public objects; and that while they were subject to these disadvantages, large sums of money were annually drawn from their limits, to be expended in the old states; that the price of the public lands was too high, and that it should be reduced to facilitate the settlement of the

west.

It was contended, too, that it was unconstitutional to divide the public revenue among the states, and that such a course would introduce corruption

into our government; that congress had no right to delegate its authority to them, and that the proposition to divide the proceeds of the public lands, was only another mode of wasting the public revenue, and thereby prolonging the system of high protecting duties.

A doubt, too, was suggested, as to the right of the federal government to hold these lands, within states which had been created.

Unless the property

in the soil belonged to the state government, or its inhabitants, it could have no claim to be independent, and it was thus degraded to a dependant condition, and was merely a colony.

Those who supported the bill asserted that though it was true that the government owned a great part of the land, still it had made liberal appropriations for internal improvements and education, and now proposed to inincrease them; that it had protected the settlers, and defrayed the expenses of their government, while territories, out of the public treasury,: that the land was sold upon liberal terms, and that the west was settled so fast, that the political institutions of the country could hardly keep pace with its growth. That the proposition to divide the proceeds was not new; and that it could scarcely be deemed unconstitutional by those who had proposed to divide the whole surplus revenue in the same manner; that there was no danger of corrupting the states by a pro rata distribution of any branch of the revenue, and that the objects to

be promoted were of the utmost importance to the public welfare. Various efforts were made to postpone taking the question, so that it was not until the 24th of January, that the vote on the substitute was taken, when the substitute was rejected, ayes 17, nays 26.

Mr. Benton then moved that each of the new states should have a grant of land equal to what had been granted to Ohio; but the amendment was negatived, ayes 12, nays 26.

Mr. Benton now moved to deduct the expenses of the public lands, before dividing the proceeds; but the senate rejected it, ayes 14, nays 24. Mr Forsyth then moved to strike out colonization, as one of the objects to which the proceeds were to be applied; which was negatived, ayes 18, nays 21.

An amendment moved by Mr. Mangum, to strike out all restrictions on the application of the funds, shared the same fate; ayes 16, nays 23.

An attempt was made, the next day, January 25, to reconsider the vote as to colonization; but the senate refused, ayes 18, nays 27. Efforts to recommit and postpone were equally unsuccessful, and the bill was passed, ayes 24, nays 20. The bill was then sent to the house for concurrence. In that body, resolutions were offered at an early day, (Dec. 11) one by Mr. Boon, and also one by Mr. Clay of Alabama, to inquire into the expediency of reducing the price of all the lands which had been subject to private entry for five

years, and to surrender the refuse lands to the states after a given period, and the other by Mr. Mardis, for granting to actual settlers the right of preemption.

These resolutions were postponed to the 16th of December, and when taken up for consideration, a discussion commenced upon the general merits of the land policy of the government, which was only terminated by a motion to lay the resolutions upon the table.

The bill from the senate was not taken up until the 1st of March.

Two motions were then made in the committee of the whole house, to amend the bill, by Mr. Duncan, to reduce the minimum price to one dollar, and to set apart 20 per cent. instead of 12, of the proceeds for the new states, which were negatived without a count.

Mr. Wickliffe then moved to strike out the objects to which the funds were to be applied, and to postpone the distribution until the public debt was paid, which amendments were carried. Mr. Clay, of Alabama,then moved to strike out the whole bill, and to substitute one reducing the price of the public lands, which, after a warm debate, was rejected without a division; as was a motion of Mr. Mason's, to deduct the expenses attending the management of the public lands before distribution.

The bill was then reported to the house, and the amendment of Mr. Wickliffe, which left the application of the funds to the

discretion of the states, was concurred in, and the other, referring to the public debt, was rejected. The other amendments were cut off by the previous question, and the bill was passed, ayes 96, nays 40, and sent back to the senate.

In that body, Mr. Chambers declared himself much dissatisfied with the amendment, but it was concurred in, ayes 23, nays 5.

These votes indicated that two thirds of both houses were in favour of the policy advocated by Mr. Clay, and if the president had returned the bill with his objections, it was understood that it would have become a law, notwithstanding the veto. This opportunity, however, was not given to them, as the president retained the law until after the adjournment, and thus prevented congress from expressing its opinion upon his objections. The bill was thus defeated by the executive, who in this manner assumed an absolute, instead of the qualified veto upon the acts of the legislature, which was confided to him by the constitution.

Among the subjects recommended in the annual message to the attention of congress, was the propriety of removing the public moneys from the United States bank.

In incorporating this institution, it was provided in the act of incorporation, that the bank should act as the fiscal agent of the government in receiving, and disbursing the public funds, and

also in transferring them from one place to another, without charge. It was also provided that the public moneys should be deposited in the United States bank, unless the secretary of the treasury should otherwise direct; and in that case, the secretary was required to give his reasons to congress immediately upon its meeting.

For its exclusive privileges, of which this was one of the most important, the bank agreed to pay, and did pay, a bonus of $1,500,000 to the United States government.

The deposit of the public moneys, therefore, was in pursuance of a contract, and the power of removal vested in the secretary, was obviously intended to enable him to secure the government from loss, should any event render the bank insecure as a place of deposit, or if the bank should prove itself unfaithful as a fiscal agent. After the act renewing the charter of the bank had been vetoed, the policy and constitutionality of creating such an institution by congress, became more pointedly the subjects of political discussion, and the administration and its supporters were finally arrayed in deadly hostility against the bank.

A striking proof of this feeling was given in the annual message, in the recommendation of the president to remove the public deposits, and a further indication was manifested when the secretary of the treasury, who had hitherto advocated its re

charter, followed up this recom. mendation by the expression of his doubts as to their safety, if continued in its custody.

An agent, appointed by the treasury, to investigate the actual condition of the bank, shortly after made his report, and it appeared that this institution, whose solvency was thus openly attacked, had funds to the amount of $79,593,870, and that its liabilities did not exceed $37,296,950, having an excess of $7,296,920, besides its capital of $35,000,000.

Exception, too, was taken by the government, to the course adopted by the bank, in relation to the redemption of the three per cents. In his desire to extinguish the public debt, the president had determined to pay off the three per cents., although they were redeemable at pleasure, and were much below par.

In March 1832, accordingly the secretary of the treasury notified the bank that it was the intention of the government to pay one half of the three per cent. certificates to each stockholder, on the 1st of July next.

In reply, the president of the bank suggested, that a large amount of duties ($9,000,000,) would fall due before that day, and that in order to accommodate the merchants, it would be better to loan the money to them, instead of paying it to the European stockholders, and consequently the payment of the debt had better be postponed for one quarter. This suggestion

was acceded to by the secretary, upon condition that the bank would pay the interest accruing on the three per cents. during the quarter, and upon that footing the redemption was deferred.

In the mean time, the cholera appeared in the country, and threatened to cause a suspension of business, and great commercial distress. In order to enable the bank to relieve the merchants, an arrangement was made by which it agreed with the foreign stockholders to pay the interest on their stock for an other year, if they would not present their stock for payment.

To this arrangement the government objected, and censured the bank for an arrangement which conflicted with the wish of the government to entinguish the debt. The bank had, however, in the mean time disavowed the arrangement which was made through its agent in Europe, and the stock was actually redeemed in the ordinary course of business at the trea

sury.

The president was not satisfied with this, and the arrangement was made the subject of much invective on the part of the administration press; and it was freely asserted that the disposition to postpone the redemption of the three per cents. proceeded from inability to pay over the deposits.

Another cause of criminaion, grew out of the bill drawn

by the secretary of the treasury for the first instalment under the French treaty.

Instead of sending to the American minister at Paris an authority to receive the money, or even of remitting the bill for collection through the bank, the government took the unusual step of selling a bill to the bank at the current rate of exchange, and appropriated the proceeds to the current uses of the trea

sury.

The bill was not paid, and, to save the credit of the bank, its agents took it up.

A claim for damages pursuant to the ordinary custom of merchants, was made for the dishonour of the bill, and the president of the U. S. was indignant that the bank should call for damages, when he contended that the public moneys in the bank were more than sufficient to pay the amount of the bill. For these reasons the executive recommended to congress, to remove the public moneys from the custody of the bank, and also to sell the stock belonging to the government in that institution.

Pursuant to this recommendation, a bill was reported on the 13th of February by Mr. Polk, from the committee of ways and means, for the sale of the stock; but Mr. Wickliffe moved, upon

its first reading, that the bill be rejected, and it was accordingly rejected, ayes 102, nays 91.

The subject of the public deposits was referred to the same committee, and on the 1st of March, Mr. Verplanck made a report, in which he stated that the committee had examined the report of the treasury agent, and also the directors of the bank, under oath, and that it appeared that on the 1st of January, 1832, the bank had $80,865,000 of available resources, and that its liabilities amounted to only $37,800,000. The committee consequently recommended a resolution, that the government deposits may, in the opinion of the house, be safely continued in the bank of the United States.

Mr. Polk, from the minority of the committee, also made a report, in which the conduct of the bank was condemned, but no conclusion was drawn as to the propriety of continuing the deposits in its custody.

The next day the resolution was taken up for discussion, and after an earnest discussion by Mr. Polk in opposition, and Messrs. Ingersoll and M'Duffie in support of the resolution, the previous question was ordered, ayes 86, nays 30, and the resolution was passed, ayes 109, nays 46.