Part 126

Mr. V. observed, that the restriction contended for by the gentleman as the result of his objection, would annihilate the most essential rights and privileges of the citizens of the United States. He then observed, a corporation is nothing more than constituting a body with powers to effect certain objects in a combined capacity, which an individual may do in his individual capacity, agreeable to the usage and customs of common law.

Adverting to the act by which the United States became a free and independent nation, he said, from that declaration, solemnly recognized at home and abroad, they derive all the powers appertaining to a nation thus circumstanced, and consequently the power under consideration. He traced the origin of corporations to the time of Numa, the first of which was for agricultural purposes; they were afterwards extended to other objects; and from that day to this, all civilized and independent nations have been in the practice of creating them; and what do they amount to but this--enabling a number of persons, in a combined capacity, to do that to a more certain effect than an individual may do; but subject to the control of common law, in all its regulations and transactions.

On the doctrine of construction, as applied to the constitution, he observed, that on some occasions the constitution is like the sensitive plant, which shrinks from the smallest touch; on others it is like the sturdy oak, which braves the force of thunder. He referred to the act containing the power of removability; in which the utmost latitude of construing the constitution was contended for and adopted; and, said he, the funding system cannot be defended on any other principle than of implication.

He then inquired, of what right does this incorporation deprive a single citizen? And can an act possibly meet the disapprobation of a single person which does not infringe his rights, and which puts money into his pocket? I think not. He insisted that the power of Congress alone was equal to establishing a bank competent to creating a currency which shall pervade all parts of the Union; the paper of the State banks cannot circulate beyond the bounds of the particular States.

From the restrictions to the Government contended for by the opposers of the bill, he compared the constitution to a horse finely proportioned in every respect to the eye, and elegantly caparisoned, but deficient in one, and the most essential requisite, that of ability to carry the owner to his journey's end; he had rather, he said, mount the old Confederation, and drag on in the old way, than be amused with the appearance of a Government so essentially defective.

Mr. MADISON observed, that the present is a question which ought to be conducted with moderation and candor; and, therefore, there is no occasion to have recourse to those tragic representations which have been adduced. Warmth and passion should be excluded from the discussion of a subject which ought to depend on the cool dictates of reason for its decision.

Adverting to the observation of Mr. SMITH, (of South Carolina,) "that it would be a deplorable thing for the Senate of the United States to have fallen on a decision which violates the constitution," he inquired, What does the reasoning of the gentleman tend to show but this, that from respect to the Senate this House ought to sanction their decisions? And from hence it will follow, that the President of the United States ought, out of respect to both, to sanction their joint proceedings; but he could remind the gentleman of his holding different sentiments on another occasion.

Mr. M. then enlarged on the exact balance or equipoise contemplated by the constitution, to be observed and maintained between the several branches of Government; and showed, that except this idea was preserved, the advantages of different independent branches would be lost, and their separate deliberations and determinations be entirely useless.

In describing a corporation, he observed, that the powers proposed to be given are such as do not exist antecedent to the existence of the corporation; these powers are very extensive in their nature, and to which a principle of perpetuity may be annexed.

He waived a reply to Mr. VINING's observations on the common law, [in which that gentleman had been lengthy and minute, in order to invalidate Mr. MADISON's objections to the power proposed to be given to the Bank, to make rules and regulations, not contrary to law.] Mr. M. said the question would involve a very lengthy discussion; and other objects more intimately connected with the subject remained to be considered.

The power of granting charters, he observed, is a great and important power, and ought not to be exercised unless we find ourselves expressly authorized to grant them. Here he dilated on the great and extensive influence that incorporated societies had on public affairs in Europe. They are powerful machines, which have always been found competent to effect objects on principles in a great measure independent of the people.

He argued against the influence of the precedent to be established by the bill; for though it has been said, that the charter is to be granted only for a term of years, yet he contended, that granting the powers on any principle is granting them in perpetuum; and assuming this right on the part of the Government involves the assumption of every power whatever.

Noticing the arguments in favor of the bill, he said, it had been observed that "Government necessarily possesses every power." However true this idea may be in the theory, he denied that it applied to the Government of the United States.

Here he read the restrictive clause in the constitution; and then observed, that he saw no pass over this limit.

The preamble to the constitution, said he, has produced a new mine of power; but this is the first instance he had heard of, in which the preamble has been adduced for such a purpose. In his opinion, the preamble only states the objects of the Confederation, and the subsequent clauses designate the express powers by which those objects are to be obtained; and a mean is proposed through which to acquire those that may be found still requisite, more fully to effect the purposes of the Confederation.

It is said, "there is a field of legislation yet unexplored." He had often heard this language; but he confessed he did not understand it. Is there a single blade of grass--is there any property in existence in the United States, which is not a subject of legislation, either of the particular States, or of the United States? He contended that the exercise of this power, on the part of the United States, involves, to all intents and purposes, every power which an individual State may exercise. On this principle, he denied the right of Congress to make use of a bank to facilitate the collection of taxes. He did not, however, admit the idea, that the institution would conduce to that object. The bank notes are to be equal to gold and silver, and consequently will be as difficult to obtain as the specie. By means of the objects of trade on which gold and silver are employed, there will be an influx of those articles; but paper being substituted, will fill those channels which would otherwise be occupied by the precious metals. This, experience shows, is the uniform effect of such a substitution.

The right of Congress to regulate trade is adduced as an argument in favor of this of creating a corporation; but what has this bill to do with trade? Would any plain man suppose that this bill had any thing to do with trade?

He noticed the observation respecting the utility of banks to aid the Government with loans. He denied the necessity of the institution to aid the Government in this respect. Great Britain, he observed, did not depend on such institutions; she borrows from various sources.

Banks, it is said, are necessary to pay the interest of the public debt. Then they ought to be established in the places where that interest is paid; but can any man say, that the bank notes will circulate at par in Georgia? From the example in Scotland, we know that they cannot be made equal to specie, remote from the place where they can be immediately converted into coin; they must depreciate in case of a demand for specie; and if there is no moral certainty that the interest can be paid by these bank bills, will the Government be justified in depriving itself of the power of establishing banks in different parts of the Union?

We reason, and often with advantage, from British models; but in the present instance there is a great dissimilarity of circumstances. The bank notes of Great Britain do not circulate universally. To make the circumstances parallel, it ought to have been assumed as a fact, that banks are established in various parts of Great Britain, at which the interest of the national debt is paid; but the fact is, it is only paid in one place.

The clause of the constitution which has been so often recurred to, and which empowers Congress to dispose of its property, he supposed referred only to the property left at the conclusion of the war, and has no reference to the moneyed property of the United States.

The clause which empowers Congress to pass all laws necessary, &c., has been brought forward repeatedly by the advocates of the bill; he noticed the several constructions of this clause which had been offered. The conclusion which he drew from the commentary of the gentleman from Massachusetts, (Mr. GERRY,) was, that Congress may do what they please; and recurring to the opinion of that gentleman in 1787, he said the powers of the constitution were then dark, inexplicable, and dangerous; but now, perhaps, as the result of experience, they are clear and luminous!

The constructions of the constitution, he asserted, which have been maintained on this occasion, go to the subversion of every power whatever in the several States; but we are told, for our comfort, that the judges will rectify our mistakes. How are the judges to determine in the case; are they to be guided in their decisions by the rules of expediency?

It has been asked, that if those minute powers of the constitution were thought to be necessary, is it supposable that the great and important power on the table was not intended to be given? Mr. M. interpreted this circumstance in a quite different way, viz: if it was thought necessary to specify in the constitution those minute powers, it would follow that more important powers would have been explicitly granted, had they been contemplated.

The Western Territory business, he observed, was a case sui generis, and therefore cannot be cited with propriety. West Point, so often mentioned, he said, was purchased by the United States, pursuant to law, and the consent of the State of New York is supposed, if it has not been expressly granted; but, on any occasion, does it follow that one violation of the constitution is to be justified by another?

The permanent residence bill, he conceived, was entirely irrelative to the subject; but he conceived it might be justified on truly constitutional principles.

The act vesting in the President of the United States the power of removability has been quoted; he recapitulated, in a few words, his reasons for being in favor of that bill.

The Bank of North America he had opposed, as he considered the institution as a violation of the Confederation. The State of Massachusetts, he recollected, voted with him on that occasion. The Bank of North America was, however, the child of necessity; as soon as the war was over, it ceased to operate as to Continental purposes. But, asked he, are precedents in war to justify violations of private and State rights in a time of peace? And did the United States pass laws to punish the counterfeiting the notes of that bank? They did not, being convinced of the invalidity of any such law; the bank, therefore, took shelter under the authority of the State.