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yond their own territory, much less that will have any foreign operation. The states, in their local legislation, must be chiefly governed by local views—this is the theory of the Constitution—and by the clause in question, they have, themselves, not only conceded the principle, but they have also conceded the fact, that the power in question is one of national, and not of local concern. How can this argument be urged with any thing like even a plausible appearance, by those who, in another instance, endeavour to deduce the principle, not from the express words of the Constitution, but from the mere proof of the fact? You have upon your table a most important report upon the subject of internal improvement. Is there any express authority given to Congress by the Constitution, to legislate on this subject? The answer is plain; there is not. Whence is the authority derived ? From the fact merely that national improvements, by roads and inland navigation, may be necessary for the common defence and general welfare. And cannot this be done by the states? The answer again is, no.
The states, individually, are not competent to the care of the national concerns. They may and do make roads for themselves, and it may happen that these will be so made in reference to each other, as to produce, by their combination, what is desired-national thoroughfares, for national convenience and national defence. But it may happen otherwise. I warn those who argue thus—who derive the power itself from the necessity and convenience of its exercise-against sending back to the states a power, which the states themselves, upon similar reasoning, have expressly granted to Congress.
The interest which the United States, as a creditor, have in this question, ought not to be overlooked. One of the communications made by the Secretary of the Treasury, during the present session, (I cannot lay my hand upon it) states, that the preference intended to be secured to the United States, is defeated by partial assignments and dispositions of property made by the public debtors.
steady and regular collection of the public revenue, so important to the public service, is, at all times, worthy of the attention of Congress; and it must, therefore, be considered as a powerful recommendation of a bankrupt law, that it would effectually remedy the evil complained of. The wisdom of the legislature may be able, perhaps, to devise other remedies; I know of none, (and I do not say it without some reflection,) that will be effectual, and not be liable to very great objections.
Upon the remaining part of the subject, that which relates to the condition of the debtor, I shall, at present, say but a very few words, not only because it has been fully and distinctly put before the committee by my honourable friend and colleague, (Mr. Hopkinson,) but because it will be more proper to consider it when we arrive at that part of the bill which contains the provisions for his relief. The general design is to discharge him altogether, provided two-thirds of his creditors shall agree. The commissioners are bound to sign his certificate, if he has been guilty of no fraud; but that will not discharge him. Two-thirds of his creditors must concur, and as they may either give or withhold their assent, at their discretion, without assigning any reason, they will, of course, be determined in their decision, by a general and comprehensive view of the whole conduct of the debtor. Has he been unfortunate? They will agree to his discharge. Has he been unjust, has he been careless, extravagant? They may, at their pleasure, refuse it. Is there any thing unreasonable in this? If, by a summary process, you take all from the debtor, if he has fairly surrendered every thing to his creditors, satisfied a large majority of them that he has been the victim of misfortune, not of misconduct, ought he to be held in subjection to the merciless resentments, or the merciless avarice of a few, and be condemned, at their pleasure, to idleness and despair? And for what purpose ? Society is deprived of the benefits of his exertions; he is himself deprived of
the use of those faculties which have been given to him and for what? Does the creditor gain by it? Has he a chance of obtaining more? I have the authority of experience for saying, that the chance is not worth estimating. Look at the operation of those laws, which grant only a partial discharge. Is a creditor in a better condition for the hold he has upon the future earnings of the debtor? One of two consequences inevitably follows; the debtor either sinks into a state of hopeless and helpless inaction, or conceals the fruits of his industry by various contrivances that are hurtful to his and to the public morals. Besides, we must never forget, that it is for misfortune that this provision is to be made; for misfortune, which no prudence can avert or prevent, but which is inseparably incident to the pursuits of those who are proposed to be comprehended in this law. But I forbear, at present, to press this part of the
I would beg leave to remark, however, that I confine myself to the exemption of the earnings of his industry. I have no objection to give to his creditors whatever he may afterwards acquire by gift, devise, descent, or any other means, in short, but his own exertions. Of these he should have the full benefit, not only for his own sake, but for the sake of society.
It was not my intention to notice the objections to particular parts of the bill, nor will I at this time notice them. There are two or three objections of a more general character, upon which I will ask the indulgence of the committee to say a very few words.
A system, it is said, must be a bad one, and contain in itself very strong temptations to fraud, which requires such bloody penalties as are to be found in the English statutes. The whole penal code of England is deeply stained with blood. When Blackstone composed his Commentaries, he mentioned, with regret, that of the offences which a man may commit, no less than one hundred and forty were
capital felonies, punishable with death. How many may have since been added by statute, to the catalogue, I do not know. The bankrupt laws of England are in the spirit of the rest of this code, and their penalties are no better evidence of the temptations offered by those laws, than are the penalties in the laws for securing life and property, that the security of life and property offers a great temptation to the perpetration of murder and robbery. You may trace it, if you please, to the state of society; you may trace it to the error of the legislature, or to a general want of humanity in their institutions, to extreme prodigality in the punishment of death, but not to the mere existence of laws for securing life and property.
Again; it is said, that a bankrupt law must be a source of endless litigation, and the evidence of it is a bill that passed some time ago for completing the execution of commissions under the former law. To make this argument available, it would be necessary to know how many cases were finished, and how many remain incomplete. It might be useful, then, to compare the proportion of each, with the cases of each kind under the state insolvent laws.The comparison would be decidedly in favour of the bankrupt law, unless, indeed, the cases under the insolvent law are considered as terminating with the discharge of the debtor, for, in truth, very little more ever comes of them. It may be well, however, to remind the honourable member who thinks the want of a court of chancery of so great importance, that a system without it must be a wretched system; it may be well to remind him that one of the chief objections to a court of chancery, so commonly urged, is, that its proceedings are interminable. But, I am sensible that I have already trespassed too long on the attention of the House.
ON THE BANK OF THE UNITED STATES, DELIVERED IN THE HOUSE OF REPRESENTATIVES, FEBRUARY 22, 1819.
[On the 30th November 1818, on motion of Mr. Spencer, of New-York, a resolution instituting a committee of inquiry into the affairs of the Bank of the United States, passed the House of Representatives. The committee, consisting of Mr. Spencer, Mr. Lowndes, Mr. M'Lane, Mr. Burwell, and Mr. Tyler, reported on the 16th January 1819. A majority of the committee, Messrs. Spencer, Burwell, and Tyler, were of opinion that the charter of the Bank had been violated in the following instances :
1. In purchasing two millions of public debt, in order to substitute them for two other millions of similar debt, which it had contracted to sell, or had sold in England, and which the Secretary of the Treasury claimed the right of redeeming.
2. In not requiring the fulfilment of the engagement made by the stockholders, on subscribing, to pay the second and third instalments on the stock in coin or funded debt.
3. In paying dividends to stockholders who had not completed their instalments.
4. By the judges of the first and second elections allowing many persons to give more than thirty votes each, under the pretence of their being attorneys for others in whose names shares then stood; when those judges, the directors, and officers of the Bank, knew that these shares belonged to the persons offering to vote upon them as attorneys.
On the 19th January, Mr. Trimble, of Kentucky, offered the following resolution. Resolved, That the Attorney General of the United States, in conjunction with the District Attorney of Pennsylvania, shall immediately cause a scire facias to be issued, according to the 23d Section of the Act “to incorporate the subscribers to the Bank of the United States," calling on the corporation created by the said act to show cause wherefore the charter thereby granted shall not be declared forfeited, &c.
On the 31st January, Mr. Spencer offered a resolution directing the Secretary of the Treasury to withdraw the public deposites from the Bank, and the Attorney General to cause a scire facias to be sued out, with the view to try the question of forfeiture, unless the Bank should assent to a series of propositions, which, when assented to, were to be made, by Act of Congress, part of the charter of the Bank.
On the 9th February, Mr. Johnson, of Virginia, submitted a resolution instructing the committee on the Judiciary to report a bill repealing the charter of the Bank.
It was during the discussion of these resolutions that this speech was delivered. The principal other speakers were Messrs. Spencer, Pindall, Barbour, and Tyler, against the Bank, and Messrs. Lowndes, M'Lane, and Storrs, in defence of it. The resolutions were rejected.]
MR. CHAIRMAN: I must beg the permission of the committee, to offer to them some observations upon the several propositions that are now submitted for their consideration and decision.