1811. ADMISSION OF LOUISIANA. 377 by Josiah Quincy. He began by declaring that he was second to no man in attachment to the Constitution and the Union. Yet, much as he loved the Union, he could not but feel that, if the bill to admit Orleans passed, the bonds of the Union were dissolved. That the States which composed it were free from their moral obligations. That as it would be the right of all, so it would be the duty of some to prepare for a separation, peaceably if they could, forcibly if they must. Hardly were the words out of his mouth when George Poindexter, the delegate from Mississippi Territory, called him to order. The Speaker, after some debate, declared the point well taken. Mr. Quincy thereupon appealed to the House, and the House, by a vote of fifty-six to fifty-three, sustained him. Continuing his speech, he went on to say that the meaning of the Constitution need not be misunderstood. The origin of it was not concealed by the mists of time, nor hidden by the darkness of unexplored ages. It had been framed within the recollection of every man who heard him, by men still living. It was a political compact, made by "We, the people of the United States." It was made "for ourselves and our posterity," and not for the people of New Orleans, nor for the people of Louisiana. They did not, they cannot, enter into the scope of the Constitution, for it embraces only the United States of America. New States may, indeed, be admitted to this Union. But they must be made from territory within the original limits of the United States. No power has been delegated to Congress to admit foreigners to a share of political power under the compact. The introduction of a new associate will be followed by a new division of power, and a new division by a lessening of the share held by the old partners. Can this be done without unanimous consent? Suppose, in private life, that thirteen men form a partnership, and that ten of them undertake to admit a new partner without the consent of the other three. Would it not be at the option of the three to abandon the partnership after so palpable an infringement of their rights? Does any one suppose that the people of the Northern and Atlantic States will with patience behold senators and representatives from States beyond the Missouri and the Red rivers pour in on Congress, manage as they see fit the affairs of a seaboard fifteen hundred miles away from their homes, and rule a body into which they have come unconstitutionally? They neither will see it nor ought to see it. He was told in reply that the bill was perfectly constitutional. He was reminded that the fourth article of the Constitution gave Congress power to dispose of and make all needful rules and regulations respecting the territory of the United States. That power to dispose of territory presupposed power to hold territory, and that power to hold and dispose of it presupposed the power to acquire it. That it could be acquired by conquest under the war powers, or by purchase under the treaty powers. That treaties were the supreme law of the land. That Louisiana had been acquired by treaty; that one of the provisions of the treaty was that the people of Louisiana were to be incorporated into the Union and admitted as soon as possible, and that this provision was not only constitutional, but was also the supreme law of the land, and must be obeyed. When at last the vote was taken, the yeas were seventy-seven and the nays thirty-six. Of the minority, twenty were from the New England States; the rest came from the Atlantic States, every one of them save New Jersey, South Carolina, and Georgia giving at least two votes. The Senate having made several amendments to the bill, to which the House reluctantly agreed, the President promptly signed it. The bounds of the new State were fixed as the Sabine from its mouth to the thirty-second degree of north latitude, thence due north to the thirty-third degree, eastward along the thirty-third degree to the Mississippi, down the Mississippi to the Iberville, through the middle of the Iberville, Lake Maurepas, and Lake Pontchartrain to the Gulf of Mexico, and along the Gulf to the point of beginning. All free white male citizens of the United States, twenty-one years old, paying a parish tax and dwelling within these bounds, were, on the third Monday of September, to choose delegates to a convention. The convention was to meet on the third Monday in November, and, if it saw fit, frame a constitution and adopt that of the United States. The State Constitution, it was expressly enjoined, must be republican in form, must contain the fundamental principle of civil and religious liberty, and must 1811. BANK OF THE UNITED STATES. 379 secure to each citizen trial by jury in all criminal cases and the privilege of the writ of habeas corpus. The convention, it was further required, must, in the name of the new State, renounce all claims to waste and unappropriated land; must promise that no State, no county, town, or parish tax should be laid on land sold by the United States till five years after the day of sale; that the lands of non-residents should never be taxed higher than the lands of residents; and must declare the navigable waters of the State open to every citizen of the United States, without any tax, duty, impost, or toll whatever. The United States, on the other hand, promised that of the net proceeds of land sold after the first day of January, 1812, five per cent. should be expended in building roads and levees. While the President was writing his name at the foot of this act, bills to recharter the Bank of the United States were rejected by both the Senate and the House, and, as the charter required, the Bank went out of business on March fourth, 1811. That such an institution, after such a long and prosperous career, should, at such a moment, have been destroyed is a complete commentary on the financial and economic notions of the day. But the causes which led to its overthrow were all but irresistible. The enemies of the Bank were made up, on the one hand, of a large number of old Republicans, who had never forgotten the arguments in use in 1791, who still denied the right of Congress to charter any corporation, who still asserted that a bank charter could not constitutionally be granted, and who still described the Bank as a monarchical institution, as an instrument of despotism, as a many-headed monopoly, as a lingering and oppressive remnant of that strongly centralized government the Federalists had set up, and which the Republicans were in duty bound to destroy. With them in their opposition were joined two other classes of more recent date: the men who, affecting the guise of earnest patriots, complained that the Bank was in the hands of Englishmen; that two thirds of the capital stock was owned in England, and that large dividends which ought to remain in America were every year drawn over to London; and the men who, excited by these dividends, longed for the winding up of the Bank and its branches, in order that the business it did might be shared by State corporations.* Of late years the number of these institutions had increased to a surprising extent. On the fourth of July, 1791, when the books of the United States Bank were opened at Philadelphia, there were but three in existence. But the establishment of a permanent and vigorous government, the creation of public credit by the transmutation of the old Congress lottery certifi cates, loan-office certificates, interest indents, commissioner's certificates, army certificates, final settlements, continental money, all the worthless remnants of the financial makeshifts of the Confederation into stock, bearing interest and selling at a premium, had called out from the old stockings, the strong-boxes, the garret floors, much of the hidden capital of the people. A period of wide-spread speculation followed, and in that period subscribing to the capital stock of a bank became as favorite a way of investing money as subscribing to the stock of a company to build a turnpike or dig a canal. Six new banks were chartered in 1792, and, in spite of the head-shaking of prudent men, did a large business and paid out each year great sums in dividends. Eagerness to share this success produced others, and these too, in spite of prognostication of failure, grew prosperous and rich. War had broken out between France and England. The markets of the West Indies were for the first time opened to our merchants. Trade instantly revived and developed to an extent which then seemed fabulous. Demands for discounts and capital with which to build ships, to buy produce, to move produce to the seaports, surpassed the ability of the banks to meet them. Their profits were immense. Eagerness to share them was again excited, and with the new capital created by *The controversy, as usual, called out a host of pamphlets and newspaper essays. The fiercest of the anti-bank essays are in the Aurora for January and February, 1811. The pamphlets are "Bank Torpedo, or Bank Notes proved to be Robbery." By R. Davis. "Desultory Remarks upon the Ruinous Consequences of the Non-renewal of the Charter of the Bank of the United States." By M. Carey. "Considerations on the Approaching Dissolution of the United States Bank." By Jesse Atwater. "Nine Letters to Dr. Adam Seybert, Representative from Philadelphia to Congress." By M. Carey. “Paragraphs on Banking." By Erich Bollmann. 1811. THE PEOPLE AND THE BANK. 381 the trade more banks were founded. And now they began to move from the seaboard inland, and to spring up in places where, five years before, such institutions had never been thought of. In 1795 the number was twenty. By 1800 it had risen to twenty-seven. Five years later sixty-four are known to have been doing business, and these in 1810 had been increased to over one hundred and three. The charge was often brought against these banks that they did business in a reckless, law-defying way, favored political friends, gave credit to men who did not deserve it, and issued notes far in excess of their ability to redeem. That many of these things were done is undoubtedly true, but that any serious over-issue of notes took place may well be questioned. Indeed, the chief cause of the deadly hatred which many of the State banks felt for the Bank of the United States was the vigilance with which it watched their issues and the incessant calls it made on them to redeem. Of all arguments used by the State banks to excite animosity against the United States Bank, this seems to have been the most powerful and the most common. If a customer applied to any of them for a discount or a loan it was not safe to make, the blame was laid on the vulture, on the hydra, on the Cerberus, which, by enjoying the sole right to receive Government money, kept thousands of dollars out of their strong-boxes, and, by constantly presenting bills for redemption, forced them to keep in their strong-boxes thousands more they would gladly loan. Even such as were accommodated went away feeling sure that better terms could have been made had it not been for the harsh manner in which the State institutions were treated by the Federal monster. The friends of the Bank, on the other hand, labored hard to explain the evils that would surely attend its downfall. It was true, they admitted, that the deposits in the State banks would be greatly increased and their business proportionately enlarged. But it was also true that the capital of the country would be reduced by the millions of specie sent to England to buy back the stock which Americans-nay, which the Government of the United States-had deliberately sold to the Barings of London; that the rate of exchange between distant |