ch they invited the financial committees of the
two Houses to hear their propositions for carrying on the financial
operations of the government. We all went to the office of the
Secretary of the Treasury, and the proposition was there made that
the United States should issue no paper money whatever, that the
specie clause, as it is called, of the sub-treasury act should be
repealed, and that we should carry on the war upon the basis of
the paper money of the banks, legalizing the suspension of specie
payments, and that the government should issue no paper except upon
an interest of six per cent., or higher if the money markets of
the world demanded more. That was their plan of finance, the plan
substantially adopted in the War of 1812, and which had been
condemned by every statesman since that time, a plan of carrying
on the operations of our government by an association of banks over
which Congress had no control, and which could issue money without
limit so far as national laws affected it. That was the scheme
presented to us by very intelligent gentlemen engaged in the banking
business. They were honest and in earnest, but it appeared to me
as pretentious and even ludicrous.

It was claimed that a tax on banks interfered with vested rights.
I said that all taxes that were levied by the government were to
maintain vested rights, liberty and life. All these corporate
franchises were held subject to the power of taxation in Congress,
which was sometimes necessary to be exercised in the most potent
manner in order to maintain the government. The state could not,
by an act of incorporation, place their property beyond the power
of Congress. The only question was what rate of taxation ought to
be adopted. The rate proposed--two per cent.--I insisted was not
too high, because it was only one-third of the profit derived from
the issue of paper money without interest, the principal of which
was not paid in coin. I stated distinctly that the purpose of the
bill was not merely to levy a reasonable tax on the banks, but also
to induce them to withdraw their paper, in order to substitute for
it a national currency. I then reviewed in considerable detail
the history of our currency legislation, from the act chartering
the first bank of the United States to the beginning of our Civil
War, showing the view taken by the most eminent statesmen of our
country in favor of the establishment of uniform national currency
as th