27TH CONG....3D SESS.

losses of 1812 and 1813 did come within the intent of the act of 1823; and, therefore, also within the intent and provisions of the 9th article of the treaty; and, overruling the decision of the Secretary that they were not comprehended, confines his discretion, in the payment, to the point of their being "just." It is the legislative decree that the provision of the 9th article was not confined to the losses of 1818. The claims of the sufferers of 1812 and 1813 were ordered to be paid, not upon any grounds of equitable consideration independent of the treaty, but expressly as being in execution of the 9th article. The intention of Congress is made still more manifest in the 2d section of the act, which authorizes the reception and adjudication of any further claims not before presented, or in which the evidence was withheld, "in consequence of the decision of the Secretary of the Treasury that such claims were not provided for by the treaty of February 22, 1819, between the Government of the United States and Spain." Thus showing that the decision of the Secretary was fully before Congress, and that the conclusion was against him, expressly UPON THE

CONSTRUCTION OF THE TREATY.

The losses of 1814 were not included in the provisions of this act of 1834, because the committee confined the bill reported to those of 1812 and '13; and the Delegate from Florida, (anxious, I presume, to avoid embarrassing its passage, by pressing the question as to those of 1814 upon the House for decision at the time,) took it as it was offered, without discussion. The distinction made by the committee which reported the bill, between the losses of 1812 and those of 1814, is altogether, in my view, a mistaken one. It is, that the invasion of East Florida, in 1812, was unauthorized; and that, therefore, the Government was liable for the damages; but that the invasion of West Florida, in 1814, being justified by the laws of nations, was in a different predicament. Now this would have been a good answer to a claim from Spain for reparation for the violence done to her sovereignty by the invasion, or for injury to public property occasioned by it--as, for instance, the destruction of Fort Barancas, &c.; but it is not a justifiable answer to a claim for the use or destruction of the private property of peaceable and unoffending peasants, and other inhabitants. Not even the pendency of open public war justifies, as I have before shown, the refusal to pay for such injuries among civilized nations.

I have endeavored, Mr. Speaker, to make intelligible to the House the grounds upon which I rest the passage of the bill. I had designed to add some further remarks to what I said on a former occasion, touching the motion of the gentleman from Ohio, [Mr. GIDDINGS;] but the sense of the House, as manifested in the entertainment of the demand for the previous question, which cut off, and virtually rejected his motion, rendered it unnecessary. Without further trespass, therefore, upon the patience of the House, I will conclude.

NOTE. In the midst of the remarks of which the foregoing is the substance, Mr. LEVY was arrested by the application of the hour rule. Mr. ADAMS then obtained the floor, and addressed the House again in opposition to the bill. When he concluded, Mr. LEVY endeavored again to obtain the floor, for the purpose of concluding his argument, and replying further to Mr. ADAMS; but he failed in this endeavor, the previous question having been called, and being insisted upon by one of the members. The House was thus brought to a direct vote upon the bill before it was in possession of all the facts and arguments depended upon in its support. The natural conse. quence of this was its rejection. Mr. LEVY afterwards, during the day, obtained the floor upon a motion to reconsider, and pursued his remarks. The argument, such as it was, has been written out, and thrown into continuous form; in order that, when the subject shall hereafter be again brought before Congress, the necessity may not exist for the consumption of time by the oral repetition of what has before been said.

REMARKS OF MR. GWIN,

OF MISSISSIPPI.

In the House of Representatives, February 11, 1843.-On the motion of Mr. C. J. INGERSOLL to print 10,000 extra copies of the majority and minority reports upon the assumption of the State debts. Mr. ADAMS having concluded,

Mr. GWIN of Mississippi got the floor, and replied as follows:

Mr. SPEAKER: The gentleman from Massachusetts [Mr. ADAMS] se ms to entertain great dread of the appearance of British vessels in the waters of the Mississippi. Has the gentleman always been as anxious to prevent their appearance in those waters as he seems to be at present? If I recollect aright an important era in the history of our coun

Assumption of State Debts-Mr. Gwin.

try, the gentleman was accused of an attempt, at the treaty of Ghent, to bargain away to Great Britain the navigation of the Mississippi river and its tributaries, for some advantage in the fisheries to the Notb. He was so charged by one of the most distinguished citizens of this country, [Mr. Clay,] between whom and the gentleman from Massachusetts [Mr. ADAMS] an adjourned question of veracity exists to this day on this subject. I should like to hear the gentleman clear up that charge, ere he presents himself as the special cham pion of the navigation of the Mississippi. Treach erous once, he may betray us again; and I am the more induced to doubt him on this occasion, as the alternative presented to avoid the horrors of war with Great Britain, and thus the appearance of British war steamers in the waters of the Missis sippi, is the assumption of the debts of the several Stales by the General Government.

Sir, is it not degrading us as a nation, to hear a Representative in the American Congress warn us against the danger of a war with Great Britain, by holding up the result of the recent contest of that nation with China as our probable fate in the event of a collision between the two nations? Shall we be threatened in our own balls with the payment of twenty one millions, to buy a dishonorable peace with that powerful, arrogant, and haughty nation? Can any American patriot forget the glorious termination of our two wars with Great Britain, then in our infancy as a nation, and destitute of resources; and shall we now, when in full manhood, be forced to commit a grievous wrong upon the Constitution of our country, to avoid a war that it is predicted will terminate so disastrously to us? Sir, it is humiliating to hear such remarks from any quarter, but especially so when they emanate from one of the Representatives of this great nation on this floor.

I have not been disposed at any time, Mr. Speaker, to introduce the question here of the valid. ity of the bonds issued in the name of the State, for the Mississippi Union Bank, and the liability of the State to pay these bonds; but the question appears to be so entirely misunderstood and misrepresented, both here and elsewhere, that I shall avail myself of this occasion to state the grounds that have been taken by a majority of the people of the State on this subject. It is simply this: shall the State assume the payment of a debt contracted in her name, in violation of her constitution? For I contend that these bonds were issued by authority of an unconstitutional law; and that even the requirements of that law, inoperative as it is upon the State, were disregarded in the sale of the bonds.

During the summer of 1841, a letter was written by my colleague, [Mr. THOMPSON,] and extensively circulated, giving a clear and concise history of the charter of the Union Bank, and its conflict with the State constitution. In order to a proper understanding of the question, I will read an extract from that letter.

"The constitution provides that 'No law shall ever be passed to raise a loan of money upon the credit of the State, or to pledge the faith of the State for the payment or redemption of any loan or debt, unless such law be proposed in the Senate or House of Representatives, and be agreed to by a majority of the members of each House, and entered on their journals, with the yeas and nays taken thereon, and be referred to the next succeeding Legislature, and published for three months previous to the next regular election, in three newspapers of this State; and unless a majority of each branch of the Legislature so elected, after such publication, shall agree to and pass such law; and, in such case, the yeas and nays shall be taken and entered on the journals of each House.'

"This wise provision of our constitution is pecu liar to our State; and, amidst the general pecuniary embarrassments which now press so heavily upon the energies of several of our sister States, arising from imprudent and hasty legislation, and from an unadvised pawning of that brightest jewel of the State-her faith-for the purpose of raising money to be used by the FEW to the prejudice of the MANY, every Mississippian should feel grateful to the framers of our constitution for their prudence and forecast in thus guarding our honor and our prop

H. of Reps.

erty, by restraining from tampering with our faith or credit as a State, a Legislature whose course of conduct has evidently preceeded from impulse, rather than wise and deliberate councils. But it would be a mockery of constitutional goveruments to say to their agents, 'thus far shalt thou go, and no farther,' and yet QUIETLY SANCTION EVERY IN

FRACTION OF RESERVED R GHTS.

“At the January session of 1837, the Legislature of our State passed an act entitled "An act to incorporate the subscribers to the Mississippi Union Bauk,' in which you must mark the fact that no provision is made that the State of Mississippi shall be a subscriber for stock. But, on the contrary, section 4 of the law says "that the owners of real estate situated in the State of Mississippi, and who are citizens thereof, shall be the only persons entitled to subscribe.' This law provides that the capital of the bank shall be $15,000,000; that the books of subscription shall be kept open for six months, under the inspection of ten managers, to be chosen by the Legislature; that so soon as five thousand shares shall have been subscribed, the Governor of the State shall appoint thirteen direc tors, to serve for twelve months, who shall take charge of the bark and the books of subscription; that, after the books are closed, the bank may go into immediate operation, whenever it shall appear that at least $500,000 shall have been subscribed and paid in; bat those declared stockholders by the directors shall pay into the bank the sum of ten dollars upon each and every share subscribed; that the stockholders shall give their bonds to the bank for the amount of stock allowed to each, and shall also execute mortgages upon real estate, with the privilege of including one-fourth of the amount on slaves, to secure the payment of their stock-bonds(thus,not only the property mortgaged, but the whole estate of the stockholder, would have been bound for the redemption of the stock;) and that both the principal and interest of the bank bonds were to be paid by the bank as they severally fell due. Then it is further provided, that the State shall pledge its faith for the redemption of the capital stock; or, in other words, shall become the security of the subscribers for stock, upon being allowed ten per cent. of the profits of the bank, the appointment of fire of the thirteen directors, and a standing accommodation loan of $200,000; and the 30th section requires the Governor to execute to the said bank, from time to time, bonds in amount proportioned to the sums subscribed and secured to the satisfac tion of the directors, until the whole amount of bonds shall be furnished. In this charter you will at once perceive no risk, no hazard of taxation whatever.

"This act was published-not the length of time required by the constitution, it is true; but still, it was published; and it is unworthy of this great question to dwell on quibbles. At a succeeding Legislature, which met in January, 1838, the same law came up for re-enactment. While it was still pending, and before another vote was taken upon it, a joint committee of the Senate and House of Representatives-a committee of the greatest weight and highest responsibility that can at any time be raised-was appointed, and instructed to examine whether the said bill can be amended; and, if so, whether it be practicable to change it into a State bank exclusively.' From the unanimous report of that committee, permit me to draw your attention to the following extracts:

"But as to that portion of the said charter which relates to the subscribers or stockholders to the said institution, being the primary condition on which the faith of the State is to be pledged, and as such constitutes a vital part of it, we have no power to change the same, unless it should be again submitted to the people for their sanction; which would have the tendency to postpone, for at least two years, its consummation. This course your committee believe would be directly at war with the wishes of our constituents,' &c.

"This report was received, and unanimously adopted by the Legislature. At that time, while the charter is still pending, and open, of course, to all amendments admissible under the constitution, it is the unanimous opinion that the vital parts of the bill cannot be changed without a re-submission

of the charter to the people; consequently, the original charter becomes a law on the 5th day of February, 1838, without change or alteration. Without calling in question the constitutionality of this charter, I might stop, and triumphantly ask, Has a single bond of the State been issued and sold under this charter? If so, who were the directors appointed by the Governor to manage the bank? Who were the subscribers for stock? Had the books of subscription been kept open six months? How many stockholders had paid ten dollars upon each and every share subscribed? How many bonds for stock had been given and se cured by satisfactory mortgage? Not one of these things had been done at the time the bouds in question were issued and sold: and the purchaser must have known it.

"But here follows the explanation: Ten days after the passage of the foregoing charter, the same Legislature that determined, by unanimous vote, that the charter could not be amended while pending before them, passed 'An act supplementary to an act to incorporate the subscriber to the Mississippi Union Bank;' wherein, under the magic title of 'supplement,' they endeavored to do indirectly what the conscience of every member checked him in doing directly. They made changes in the charter, by way of supplement, which, but a few days before, they had declared, under catb, would vitiate the whole instrument. This procedure was in violation of all parliamentary rule known in this or any other enlightened country; and it can be considered in no other light than a legislative fraud, because it violated not only the constitution, according to their own showing, but also one of their express rules of order, which prohibited the repeal of any law the same session at which it was passed. On the 15th of February, 1838, this act took the form and shape of law. The very first section changed aitogether the attitude of the State to the bank. In the original act, the State, being amply indemnified, agrees to stand as the security of the stockholders; in this supplemental act, she becomes primarily liable for $5,000,000. In the original. act, no individual but a citizen of the State can subscribe and take stock; in this act, the State becomes a subscriber for stock, and, by express repeal, gives up her ten per cent. of the profits, her five directors, and her accommodation loan of $200,000, and be. comes a partner in the banking adventure. All this is done under the talismanic word 'supple. ment,' without submitting it in any way to the people! Now, it must be apparent to the commonest understanding, that it was not in the power of the Legislature to make the State a subscriber for stock in that bank-to render her liable for the sum of $5,000,000, or any other amount-to change her attitude in any respect towards the stockholders in the bank-to enlarge or diminish her interest in the bank, as it stood at the passage of the original charter, without submitting it to the action of the people. This right had been expressly reserved to the people in their fundamental law; and, until they had been consulted in the manner prescribed, all action by their supposed agents was null and void; and the whole world were bound to take notice of it. These propo.i. tions are so self-evident, no man of candor and discrimination will dispute them. The only question remaining is, Does the present supposed liability arise under and by virtue of the supplement?

"It is apparent that it does so arise-1st, from the very terms of the mortgages for stock, which were drawn up by the officers of the bank, and which bave been recorded in almost every county of the State; in which it is set forth that the intent of the mortgage is to secure the payment of only $10,500,000; leaving $5,000,000 (the sum already sold) to be paid by the State, by virtue of the supplemental act. 21. It is apparent, from these facis, that, at the time of the issuance of the five mil lions of bonds now held abroad, there were no subscribers for stock; that the books of subscrip. tion had not been kept open six months, as required by the original charter; that no bonds for stock, and no mortgages to secure them, had been taken; that no directors had been appointed by the Executive to examine and pass upon the validity of the mortgages; and that not a dollar had been

Assumption of State Debts-Mr. Gwin.

paid in on a single share of stock: therefore, they must have been issued in pursuance of the supplemental act; or else there is more baseness in this whole transaction than ever characterized any other act of public functionaries. 31. It is apparent, from the very terms of the power of attorney from the managers of the bank to the commisioners who went abroad to sell these bonds. This power of attorney-after reciting that the act to incorporate the subscribers to the Mississippi Union Bank had been passed by one Legislature, and, in conformity to the constitution, had been published, and referred to the next succeeding Legislature, which had passed and conârmed the said original act; and that the same was approved by the Gov. enor, on the 5th day of February, 1838,-continues: 'And whereas the said Legislature last above mentioned passed an act entitled An act supplemental to an act to incorporate the subscribers of the Mississippi Union Bank, which was approved by the Governor, February 5 b, 1838; and whereas the Governor of the State of Mississippi has, pur. suant to the provisions of the said supplemental act, subscribed, in behalf of the said Sate, fifty thousand shares of the capital stock of said bank, and has executed twenty-five hundred bonds of the said State of Mississippi, for the sum of two thousand dollars each,' &c. If truth can produce conviction, surely this question is now placed beyond cavil. 4th. It is self-evident, that the purchaser of the bonds had not only constructive, but actual, notice that the faith of the State could not be pledged under the constitution by an act of the Legislature, without a confirmation by the people; that the supplemental act had not been confirmed by the pecp'e; and that the bonds he purchased were issued 'pursuant to the provisions of the said supplementary act!! because this power of attorney to the commissioners is made part and parcel of his con tract with them, and it contains a full statement of these facts."

This is the ground taken by the State in regard to these bonds. Not a dollar of the money for which the bonds were sold was received by the State; they were sold by agents of the bank, ap. pointed by authority of the unconstitutional sup plement, and the money received by the bank, and used by it. Not a dollar ever went into the State treasury, or was under the control of a State officer. The archives of the State exhibit no evidence of the existence of these bonds as an obligation upon the State; nor was there ever deposited there any evidence that the State is a stockholder in the bank. For these reasons, the State has refused to assume the payment of these bonds. No party in the State is in favor of levying a tax for their payment. The question between the two parties is assumption or non-assumption. The first contend that the State shall assume the debt, at the same time they refuse to provide by taxation for its payment. "Settle fair, if you never pay," is their motto. The latter contend that the bonds were issued by virtue of an unconstitutional law; sold in violation of that law; and it would be a fraud upon the constitution and laws to assume their payment. While we refuse to acknowledge this to be a State obligation, yet no obstacle has been thrown in the way of the bondholders, if they desired to secure the assets of the Union Bank. In fact, the Democratic party in that State desire that these assets may be thus appropriated. I differ with Governor McNutt in the estimated value of these assets. If honestly appropriated to the redemption of the notes now unredeemed, after their payment a large surplus must exist, to be applied to the payment of the bonds. In addition to these, the assets proper of the bank, there are also the subscriptions of the stockholders for ten and a half millions of dollars, secured by mortgages upon some of the most valuable estates in that State, and equal in productiveness to any in the world, which some of the first legal men in the State contend will be held liable to pay these bonds. I do not give this as my opinion. I am no lawyer; but members of that profession, equal in learning and intellect to any in this country, entertain this opiaion.

No obstruction will be thrown in the way of the bondholders, if they wish to test the validity of these mortgages. The State and United States

H. of Reps.

courts are open to them. Let them proceed to test this question; and, if they succeed, then this mort. gaged property with the assets proper of the bank wil, it is supposed, pay the whole debt of five millions, with the interest. Sir, I entertain no doubt but these bonds are much more likely to be paid than the bonds of several States, whose Legislatures are passing resolutions against repudiation.

I alluded, in the commencement of my remarks, to the course the gentleman from Massachusetts was report d to have pursued in the negotiations at Ghent, in regard to the nawigation of the Mississippi by British vessels. I care not now whether the charge was true or false, further than to declare that I do not believe he would deprecate the appearance of British war steamers at Natchez as much as he has pretended on this occasion. Blue lights, kindled by traitorous hands in our own country, directed our enemies to our weakest points during the last war. The gentleman [Mr. ADAMS] may be designated as the finger-board directing the attention of Great Britain to what he at present considers our weakest point. He has declared that, in the event of war, or insurrection in the slave Sales, requiring the intervention of the General Government, our slaves will be free. The great object of his life seems to be to cause the emancipation of our slaves, regardless of the war of ex ermination that must ensue between the two races, should success attend his efforts. What more effectual aid can he obtain than the naval power of Great Britain, concentrated, at his suggestion, at the South, in the event of a war with that nation, sending war steamers to the very centres of the slave States? Martial law is proclaimed--insur ection excited-the Government of the United States send armies to expel the invaders and suppress the insurrections; and thus, according to the gentleman's doctrines and opinions, oft repeated on this floor, our slaves would be free, and his great object accomplished. If the gentleman does not desire this result, his course is well calculated to bring about a war between this country and Great Britain. The assumption of State debts, or war, are the alternatives presented to us by him; and he hesitates not to say that England will have cause for declaring war, if these debts are not paid. That powerful and rapacious nation will not be slow in adopting this suggestion, coming, as it does, from a member of this House who has filled the exalted station of President of the United States. He calls the refusal of Mississippi to assume payment of those bonds "metaphysical distinctions" which he do s not understand. Foreigners have urged this same argument in favor of assumptionthat they cannot understand the distinction or difference between the State and the Federal constitations. After the remarks of the gentleman, they will have high authority on this side of the water in favor of assumption on this ground.

The gentleman entertains great horror of State repudiation of unacknowledged debts; yet he is the advocate of, and voted for, the bankrupt law, which established the most wholesale system of repudia. tion of honest, bona fide, undisputed debts ever known in this or any other country. According to the gentleman's theory, it is disgraceful for a State to refuse to assume a debt she declares was created in violation of her constitution, and for which she received nothing; yet it is perfectly fair and hon. orable for the citizens of that State, one or all, to repudiate all of their honest bona fide debts, under the bankrupt law-debts contracted in accordance with constitution and law, and for which full value was received. I will make a practical application of the gentleman's theory of dishonorable repudiation of unacknowledged State debts, and honorable repudiation of acknowledged private debts. During the glorious era of paper money, from 1835 to 1840, commercial houses in Europe established agencies in this country, to advance money to the planters, to secure shipments of cotton to their houses. Competition sprung up in this line of business, as in most others; and the agents advanced much more than the cotton was worth, which, on settlement, left the planters greatly in debt. These balances falling in part in the hands of the Barings, are sent over for collection; but the planters go into court under the bankrupt law, and

7TH CONG....3D SESS.

pay off the debt at one cent to the dollar. This is all right and fair, and perfectly honorable, according to the gentleman's code of morals. But these same Barings have some bonds issued in the name of the State of Mississippi, for which she received nothing; and she is dishonored because she does not assume them.

I have a stronger case than this-this great Uniion Bank itself became a cotton broker, and advanced fifteen cents per pound to the planters for their cotton, and shipped it to Baring & Brothers, who advanced to the bank about half that sum; yet the cotton sold for less than the amount advanced to the bank by the Barings, and the balance is unpaid, the bank insolvent, and has assigned its assets without providing for this debt; yet no one complains of dishonesty or dishonor in this transac tion, while the same Barings have advanced the Bank of the United States money on hypothecated, pretended Mississippi bonds; and, according to the gentleman's code of honesty and morality, the State is dishonored because she will not assume the payment of these bonds, for which she received nothing no more than she did of the advances upon the cotton shipped by the Union Bank. The Government of Great Britain has repudiated forged exchequer bills that had passed into the hands of innocent holders; has repudiated a portion of her national debt, by taxing the income of the holders of her bonds; yet she is not branded with dishonor by our moralists here. Wagon-loads of continental money, issued during the revolutionary war, the use of which enabled our forefathers to achieve their independence; countless obligations of the States, issued for value received during the same peri d, have been repudiated without a stain upon the national escutcheon; yet, because Mississippi refuses to recognise an unconstitutional debt, for which she has received nothing, she is to be accused of tarnishing that escutcheon. Nations all over the civilized world bave repudiated bona fide debt, without the charge of dishonor; while we are to be singled out as being disgraced because we will not pay a debt not our own, in contracting which we did not receive value to the amount of a red cent. I look upon this pretended horror of Mississippi repudiation as hypocritical as it is insulting. The fund-mongers and advocates of the banking, bonding, and paper-money systems in this country and Europe, and their agents here, are bellowing against repudiation, to draw public attention from their own infamous schemes of swindling. We have been taunted by these men who live on the labor of others, through the machinery of the banking and paper money system, until the Robespierre of the Harrison administration, [Mr. GRANGER,] who was as fond of cutting off heads politically as that monster was in reality, has ventured to lecture my colleague for proposing to bring down the expenses of the Government to its current revenue. The gentleman from New York, [Mr. GRANGER,] in his peculiar manner, which he always assumes when he purposes to say something witty or severe, reminded my colleague that it was unnecessary for him to advocate retrenchment, as our debts cou'd be repudiated under the new doctrine, if they bec me troublesome. He thought he had touched my colleague on a tender point; but, like the blind rattlesnake in August, he struck his fangs into his own politically corrupt body. No man in this House is a more zealous advocate of the repudiation of honest, bona fide debts, under the bankrupt law, than he is. We all recollect his valedictory, when this House was about repealing that law Yet he has the audacity, in the face of the House, to sneer at repudiation. It was like the devil reproving sin, cr a prostitute lecturing on virtue and morality. I will submit to this mode of attack upon my State no longer. If gentlemen will travel out of the reg. ular order of debate to attack us, they must expect to be met with a spirit becoming the Representatives of a people whom neither the scoffs of the corrupt, nor the frowns of power, can turn from their purpose, in defending their constitution and laws from violation.

The gentleman from Massachusetts [Mr. ADAMS] points to the fate of China, and warns us 10 avoid a similar one, by getting into a

war

Assumption of State Debts-Mr. Gwin.

with Great Britain. I recollect he, in a public address, put England in the right and China in the wrong in that war, as he intends to do this country, if we have war because we will not assume the State debts. He appears to be on the British side in argument, if he is not in feeling. I do not desire war with Great Britain, or any other nation; but the dread of it shall not force me to advocate the assumption of State debts, in violation of the Constitution of my country. My constituents prefer war, if the other alternative is asumption. We have a deeper interest in peace and commercial intercourse with Great Britain than any State in the Union, as we export more to that country than any other State; yet we will forego all of these advantages of peace, rather than sanction an invasion of our fundamental law. I despise the truckling spirit that is manifesting itself in this country to the power of Great Britain. We can expect no permanent peace by acting thus. I would prefer, in the language of the gentleman from Virginia, [Mr. WISE,] to s'ap John Bull in the face, to quailing before his power. We will gain his respect, and a more permanent peace, by this course.

The gentleman from Massachusetts has great fears of the English Paixhan guns, and supposes many cases to bring them to the bombard. ment of Na'chez I will answer him by suppo. sing that subjects of Great Britain call on their Government to defend them against the operations of the ex post facto bankrupt law, which has defrauded them out of immense amounts of their debts in this country-bona fide debts--for which full value had been received before the passage of the law. That Government, through its minister here, asks for redress. Our President and Secretary of State return no answer. The potent argument of the Paixhan gun is brought to bear with a fleet of war steamers upon the city of Boston, demanding the British debis repudiated there under the operation of the bankrupt law. What is to be done? Why, according to the reasoning of the gentleman from Massachusetts, the horrors of war must be avoid. ed, and this Government must assume these debts and get clear of the Paixhan guns. I have no such fears of war or Paixhan guns, as to induce me to sanction a violation of the Constitution, to avoid the one or get clear of the other. On the subject of assumption, I may have something to say hereafter. My only object in addressing the House now, has been to defend my State from the unjust imputations that have been cast upon it.

In reply, Mr. GRANGER of New York said that he had been charged on this floor with having unjustly stated that the State of Mississippi, having received five millions of dollars for stock in the Union Bank of Mississippi, had become a S'ockholder in that institution, and then repudiated, or attempted to repudiate, that debt. What he had stated was this, and he was ready to prove it; the documents were before him. He had stated, or intended to state, that under the laws of Mississippi the Governor of the State had been authorized to sign $15,500,000 of bonds for the Union Bank; that he had been authorized to subscribe $5 000,000 stock for the Union Bank; that he had so sub. scribed, and had signed this $5,000,000 of bonds; that this $5 000 000 of bonds sold for $5,080.000; that the money was put into the Union Bank, and became its capital.

Mr. GWIN (Mr. GRANGER yielding the floor) said that the Union Bank of Mississippi had issued post-notes, which, from the date of their issuance, had been below par, and had sold her checks on the Bank of the United States, receivable in this irredeemable depreciated money. That was the way the bonds had been sold for par. They had been sold under par, (if gold and silver constituted the standard,) and on credit, which was a violation of the unconstitutional supplement under which the bonds were issued.

Mr. GRANGER would explain this matter. He had not assailed the conduct of the Chief Magistrate of this State, or intended any personal dis respect to him; but he had not made the assertions he had made without the proof before him.

What was the condition of the charter of the Union Bank? It had been created in January,

H. of Reps.

1838. This supplemental act, which had been de clared contrary to good faith, but which was signed by Governor McNutt, had been passed on the 8th of February of the same year. The gentleman from Mississippi [Mr. GwIN] bad told them the other day that these laws had been passed by an undivided Whig vote, with the votes of a few of the "Democrats." Mr. GRANGER understood that there was no exception taken to the original charter, but to the supplemental act. Who voted for the supplemental act? asked Mr. G. They would find, by reference to the records, that it passed by a vote of fourteen Whigs and thirty-six "DemoHe knew not how many Whigs or how many "Democrats" there were in the Legislature of Mississippi; but he did know that, of the fifty votes that passed the supplemental act, against a minority of something like thirty, fourteen only were Whigs, and thirty-six were "Democrats." Let the question, then, be settled as to who passed this "infamous" supplemental law.

crats."

What was next? Governor McNutt, on the spot, and well knowing every fact of the case, signed the law. What next? Governor McNutt, under that "infamous" law, signed the $5,000,000 of bonds. The money was received, and the avails of this $5,000 000 of bonds went into the Union Bank of Mississippi, and constituted its only capital. And how did they treat that institurion? He would tell them how. They recog. nised it as a bank; the State transacted business with it as a bank; they declared by law that the dividends received on that $5,000,000 of stock should go to the cause of internal improvements and of public education. On the 15th of February, 1839, the State of Mississippi borrowed $75,000 of that bank; on the 19th of February it borrowed $75,000 more, and subsequently $25,000 more to finish her public buildings. And before all these transactions, and after signing these bonds, and after the bonds had gone into operation, the State of Mississippi, which had sold city lots in Jackson, and taken promissory notes for them to the amount of $25,106, went to the Union Bank of Mississippi, and had them discounted as a commercial transac tion, and put the money into her treasury. Was he to be told, in the face of all these facts, that the State of Mississippi had had nothing to do with that bank?

The gentleman had said that the bondholders could be paid from the assets of the bank. Let them see what those assets were, as presented by the gentleman's own witness and friend, Governor McNutt. He held the statement in his band. Let them see whether he had ever declared what he could not substantiate-that the $5,000,000 put into the bank from these bonds was the only capital the bank had ever had.

As late as January, 1840, Governor McNatt, in his regular message, says "the faith of the State is pledged for the whole capital stock" of this bank; and the statement of the bank's affairs, as given by this same Governor, in h s message of January, 1841, is as follows: Suspended debt in suit not in suit

Do

$2,689,860 20

1,777,337 78

5,080,000 00

Resources, chiefly unavailable, Immediate liabilities.

Capital stock

Specie on hand

4,349 06 What a beautiful condition for bondholders! said Mr. G.

Mr. GWIN (Mr. GRANGER yielding the floor) said there were ten and a half millions of real es tale mortgaged, to which he had alluded when he had said that the assets would probably pay the debt, if the property mortgaged was liable.

Mr. GRANGER. He would come to that. The gentleman had said, in reply to his question, there were $10,500,000 more. Now let them see what these $10,500,000 were; for this was to become a very interesting question in the history of this na

tion.

There were $10,500,000 more to be secured on bonds and mortgages, as the gentleman said; and he knew it was still an open question whether it should be paid. The gentleman would certainly agree with him, that not one dollar had ever been paid. Governor McNutt, before the Legislature of Mississippi, when urged by Mr. Turner to go on

and issue these bonds, had entered his protest against them, and said he had to receive the odium of standing between the voice of the people of Mississippi and his view of constitutional right, but he would not issue these bonds.

[Mr. GRANGER read from a letter of Judge Turner, dated Natchez, March 23, 1838, in which Mr. GWIN's name was introduced in such a manner as to convey the idea that he was in favor of the issuing of these bonds.]

Mr. GWIN (Mr. GRANGER yielding the floor) said that letter was written by Judge Turner, one of the judges of the supreme court of Mississippi; and be bad to state that the first time he ever saw or heard of that letter was in print; and he had received a letter from Judge Turner, asking him if he recollected any such le ter, or the conversation alluded to; and he had replied that he neither recol. lected the letter, nor any conversation alluded to on the subject.

Mr. GRANGER continued. He assured the gentleman (and they were not words of ceremony) that he bad not introduced the letter with any view to call up an unpleasant thought in the gentleman's mird; he had brought it in, to present the facts of the case, to show that the Union Bank never received but $5,000,000 as its capital, and that this was from the sale of these bonds that had been repudiated; and that Governor McNutt had been urged to issue further bonds, and would not do it; and that thence it was that the capital of the bank had been limited to $5,000,000.

Mr. GWIN said that letter was written before the bonds were issued.

Mr. GRANGER said he still believed that Governor McNutt, in his answers before the committee, had said that he prevented the further issue of these bonds.

Mr. G had not entered on this question with any view to wound the feelings of any man here or elsewhere, or to assail any State of this Union. Had Mississippi, finding herself in the position in which States were and individuals were-had she, from the pressure of the times, been forced to yield, and, declaring this debt her own, asked for further time for its payment, then it would not have had, on this nation, the effect which it was now calculated to have abroad. He bad examined this question somewhat, and he had believed, and did now believe, that it was due to the character of the nation that it should be understood. All he had declared was, that the State of Mississippi, through her constituted authorities, had chartered the Union Bank; that fifteen days after it had passed a supplemental act, (signed by Governor McNutt;) that, under that act, $5,080,000 had been received in such currency as they had chosen to receive it in, and that that was the only capital stock the bank had ever received. He had then gone on to declare that this bank-thus raised in corruption, as the gentleman had told them, and in violation of the constitution and laws of Mississippi-had been recognised by the Legislature of that State, which had become a borrower of that institution. He had then declared that Governor McNutt, in his message as late as 1840; had said that, in this matter, he had yielded his individual opinions to the voice of the State, but that he had not then pretended to say that these bonds had been unfairly negotiated; or, if he had, these extracts from his message bad been unfairly quoted; and he would like to hear the gentleman state it, if this was not the case.

Mr. GWIN. He stated, in his message, that the bonds were sold under par, and in violation of law.

Mr. GRANGER. But he signed the bonds.
Mr. GWIN. No doubt of that.

Mr. GRANGER. Governor McNutt signs these bonds, and then goes on to prove, by his report of the state of that bank and its condition, that there never had been a dollar in it but the results of these bonds, and to show that the property of this bank, to which the bondholders were to look, was not worth one dollar.

Mr. G. had not said anything here as of his own knowledge. He had spoken from the records, furnished not by those politically opposed to the gentleman, but by Governor McNuit himself and his

SPEECH OF MR. THOMPSON,

OF MISSISSIPPI,

In the House of Representatives, February 11, 1843. The House resumed the consideration of the motion made by the gentleman from Pennsylvania, [Mr. J. R. INGERSOLL,] to print 10,000 extra copies of the reports of the majority and minority of the Committee of Ways and Means against the proposition to issue $200,000,000 Government stock to be distributed to the States.

Mr. THOMPSON of Mississippi said: I wish to call on this House to bear witness that neither my colleague nor myself has, in any way, thrust upon its consideration the refusal of our State to acknowledge her liability for the payment of the Union Bank bonds. And a disclaimer has been made, that, in alluding to this question, any personal reflection was aimed at her Representatives on this floor. Then it follows that the State of Mississippi has been attacked for her conduct in her sovereign and independent character; and, as the Representative of her people, I claim the right to be heard. But my remarks shall be purely defensive; and I will not be betrayed into an assault upon any other of these sovereign States. Sir, when any one of these twenty-six States has acted on any question pertaining to her internal policy alone, far be it from me to call in question the propriety of her conduct, the purity of her motives, or the honor or honesty of her principles. It shall be enough for me to know that the sovereign has willed it. In monarchical Governments, the principle of law is, that the King can do no wrong. In these twenty. six sovereignties, I feel bound to admit that no one of them can do or has done a dishonorable act. On the Supreme bench of the United States, the justices regard the decisions made in any one of the States, by the highest judicial tribunal known to such State, on any questions involving their municipal regulations, as binding upon them-not by statute, but by comity and respect for the authorities of the States. The policy adopted may be unwise, may be destructive of their best interests, but can never be destructive of their honor. band of twenty-six States, with honor untarnished, will never, I trust, turn against each other and breathe out the foul breath of suspicion and distrust upon the fair name and good character of any one of them. The others will explain, palliate, defend, and justify the suspected and slandered party. When all others should leave and desert them, they will cleave to and maintain each other.

This

But, instead of this feeling, have we witnessed no anxiety among some of our sister States, and even on this floor, to condemn Mississippi for her late action, and proclaim that condemnation abroad. Instead of hearing her defence with patience and kindness, like sisters gangrened with jealousy at her former unrivalled prosperity, they are swift in the expression of their opinion of her fall, and show an anxiety that all the world should uncharitably and unhesitatingly condemn her. Some of the States who annually rob her, by virtue of your plundering protective policy, of more than a sufficiency to meet every dollar of interest accruing from her public debt, seem delighted to proclaim her dishonor to the world. Treated in this way, she entertains for all such expressions of sentiment and attempts at chastisement the most sovereign and ineffable contempt.

But an effort has been made on this floor, be. fore the assembled Representatives of the people of the United States, to fix a stain upon the fair escutcheon of Mississippi. She has been charged

H. of Reps.

with a refusal to pay her honest, just debts. A refutation of this charge is first required at my hands.

The gentleman from New York, [Mr.GRANGER,] in the discussion a few days since, adroitly evaded the points presented by my colleague, and endeavored to draw off the mind of the House to collateral and immaterial points. He assumed—1. That the Legislature and the Governor represented the State, and, in all their action with others, formed the State of Mississippi. 2. That this Legislature and Governor passed a law which authorized the issue of $5,000,000 bonds, on the faith and sole responsibility of the State. 3. That, in pursuance of that law, the Governor signed the amount of bonds, and affixed the seal of the State thereto, and delivered them, as bonds of the State, to the Union Bank. 4. That the Union Bank, as the agent of the State, sold the bonds at par, and received the money for and in behalf of the State; and, therefore, that the State, now that the morey is squandered, is bound in good faith to acknowledge and pay the bonds.

I hope I state the gentleman's points fairly.

In reply, I deny that the Legislature and Govvernor represent the sovereignty of Mississippi, in an unqualified sense. We have a constitution; and that is the paramount law. That constitution has expressly forbidden the Legislature from doing certain things. It has fixed certain limits beyond which the Legislature cannot go, and bind the people legally or morally. Every friend of constitutional government will yield this position. the most liberal construction of State constitutions, then, I will say that the Legislature and Governor can act for the State in performing everything which is not denied to them by the constitution; and everybody is bound to know what powers are denied to them.

With

In the second place, I deny that the Legislature ever passed a law which authorized the Governor of that State to subscribe for $5,000,000 of stock in the Union Bank, for and in behalf of the State; to issue the bonds of the State therefor, and pledge the faith of the State for their payment. It is true, a bill to that effect passed three several readings in the Legislature of 1838; but an express clause in our constitution, which has been read by my colleague, says such a bill shall not be a law, and receive the sanction and effect of law, until it has passed two consecutive Legislatures, and been published in the mean time in three newspapers of the State. When the Legislature of 1838 adjourned, this bill had been read three times, and it was in the way of becoming a law; but that Legislature refused to submit the law to the people, upon motion made in accordance with the requirements of the constitution; and adjourned, leaving it among the acts of that session. At that time, that bill was no more a law than is the bill upon your table creating an exchequer-having been read twice, and the Constitution requiring it to be read three times. The constitution of Mississippi required such a law-pledging the faith of the State-to be read six times; three times by each Legislature. And to call such a bill, when it has been read three times, a law, is a most intolerable fraud in legislation.

In the third place, I deny that the Governor issued the bonds of the State when he signed his name to these Union Bank bonds, and affixed the seal of the State thereto; because there was no law authorizing the issue of the bonds of the State, for the purpose of taking stock in the Union Bank for the State. What he did, therefore, was without authority, and in fraud of the people's rights; and therefore null and void.

In the fourth place, I deny that the bank' was the agent of the State in selling and disposing of her bonds. For, though the Legislature has an undoubted right to create a banking corporation; and though a law may be constitutional in part, and thus far valid, while it is unconstitutional in other parts; yet, as the State had passed no law for the issue of these bonds, the Governor had executed them without authority. He disposed of them by delivery to the bank without authority; the bank received them without authority, and dis

27TH CONG....3D SESS.

posed of them to Mr. Biddle without authority from the people of the State of Mississippi.

Now, sir, here is the whole case: Certain bonds are out, signed by A. G. McNutt, and having the great seal of the State affixed thereto; and, when these are presented, I admit a prima facie case is made out against the State. We plead non est factum. We say they are not our act and deed; and upon this issue we stand before the world. The burden of proof is upon us, and we show our constitution is the supreme law. To pledge the faith of the State, a bill must be read six times-three times by each consecutive Legislature. The pretended law, in pursuance of which the bonds in question were issued, was never read but three times; and therefore was a bill then pending, and not a law. We look into the contract of the sale of these bonds, and we find that the purchaser had not constructive, but actual notice of the provisions of the constitution, and the defectiveness of the law; for these facts are imbodied in the contract between the agents of the bank and the purchaser. We therefore say, You dealt with the bank; you did not trust the State; these are not our bonds; and, to admit them as such, would not only do violence to our fundamental law, but be admitting an untruth.

This is the position assumed by the State, in her Legislature. In these positions, I believe in my conscience she is right.

This is not the position occupied by Governor McNutt, whose course has been animadverted upon with so much severity. And I wish to inform the gentleman from New York, that Governor McNutt is not the State of Mississippi, and that the Legislature has not adopted his reasoning in resisting the acknowledgment of these bonds. As Governor McNutt signed the bonds, he cannot deny his authority, which the people do. But his position is this: He alleges, (and with truth,) that he delivered these bonds to the bank as escrows, to be valid against the State on the performance of certain conditions precedent: one was, that the bonds should not be sold below par. He contends (and the fact is so) that the bonds were sold below par, having been sold on a credit, and the bonds bearing interest from date. Another point is, that the bonds, by the endorsement of the bank, were made sterling bonds, in violation of the law of their creation. He further contends that there was fraud and collusion in the sale of the bonds; and, as the Executive of the State, he officially informed the purchasers of his belief of the exist ence of fraud, and of his determination to resist their payment. Years have transpired since that time; and yet the bond-holders have made no effort to disprove these allegations.

Section 10 of the general provisions of the constitution is in these words: "The Legislature shall direct by law in what manner and in what courts suits may be brought against the State." In pursuance of this provision, a law was passed giving this jurisdiction to our court of chancery; and an appeal can be taken by either party to the high court of errors and appeals. I believe all the judges upon the bench, in the chancery and court of errors and appeals, are kindly disposed to the payment of these bends by the State. Why, then, have not the holders of these condemned bonds come before these courts, and met these charges? The courts are open, and they have declined to vindicate their rightful possession of the bonds in a legitimate way. They prefer to get the gentleman from New York [Mr. GRANGER] to pour out invective against Governor McNutt, and slander upon Mississippi.

[Mr. GRANGER here interrupted Mr. T., and said that he knew no one of the holders of these bonds ] From this circumstance, however, the presump tion is strong, if the conclusion is not inevitable that the bond-holders dared not come to the issue.

But by attack Governor McNutt? He is not the acting Governor of Mississippi. He is a private citizen. Nor was he the candidate when the people decided this question. The present chief magistrate of that State was, at that memorable era, (1838,) a member of the State Senate. He resisted then, with his strong and vigorous intellect, the panic and distress feeling which governed

Assumption of State Debts-Mr. J. Thompson.

the Legislature. When that body read this supplement the third time, and refused to submit it to the people, he entered his solemn pretest upon the journal of the Senate against the measure, as unconstitutional. This protest was published in most of our papers, and the purchasers of the bonds must have known the fact; and, in the year 1841, the people called him from private life, against his interest and his inclination; and, in spite of his protestations to the contrary, into the chief magistracy of the State, as the representative and imbodiment of the sentiments and feelings of the people on this question. On this question he took the high ground of constitutionality, on which the contest of 1841 turned.

We think we owe it to the cause of constitutional liberty to take the course we have pursued. It has cost the State no little effort to maintain the integrity of her institutions. We have had, and still have, obstinate prejudices to encounter; the frowns and denunciations of the interested to resist; and the averted looks of some of our best friends. But our people have never quailed. Slandered and denounced, we have stood the firmer and the more resolute in our settled purpose, with the hope that the day would come when our sister States would do us full and ample justice. We have passed the Rubicon; and to Rome we will go. We have the mens conscia recti; and we abide our time. But suppose we are wrong. Suppose our position is un. tenable; yet you must confess that we are frank, manly, fearless, and above disguise. You must admit, if we are sinners-which I emphatically deny-we are bold sinners. Our courage must command your respect, though our course may net meet your approbation. We do not mean to promise and deceive, when we do not mean to pay; we do not intend to sneak out of our liabilities; we do not intend to read homilies about the sanctity of contracts, and fulfil none of our own. There are ten States of this Union, and one Territory, now under protest; there are six more that borrowed money during the last year to meet the demands upon their treasury. There are seven that owe no debt, and three have passed thus far unscathed. Why, then, is there such a disposition to pounce upon my State? Our case will not answer as a precedent for any of you to repudiate your just debts. No State in the Union has such a horror of debt; and no State had endeavored so much to guard its people against debt as Mississippi. It was said by the gentleman from New York that he would not complain if we were to plead insolvency. If we would trample our constitution under foot, and acknowledge a null and void obligation, he would be content; but it was shameful to rely upon such obsolete ideas as the constitution. What we promise, we expect to pay; and when we do not expect to pay, we will not promise. And I can say to the gentleman from Maryland, there is one pass to which we will never come-there is one degree of self-abasement, at which the proud spirit of every Mississippian, be he Whig or Democrat, will start back from with shuddering and dismay. Mississippi, by or through any one of her Representatives, will never prostrate herself before the footstool of Federal power, and say, with a dogged and craven feeling, Pay my debs, or I will disgrace myself by repudiation; steal I must, if you do not give me money enough to keep me from starvation. If Mississippi cannot pay her debts, the whole affair shall be her own. She will scorn to involve others with her. She will suffer in silence the discredit and dishonor, if such it may be considered; but she will never ask her sister States to bear her burdens. If she has none of that spirit by which she could raise men to Heaven, I thank God she has none of that other spirit, by which she would drag angels down.

The gentleman from Maryland said that the issue was relief or repudiation. But I say, Assume the debts of the States to the amount of $200,000,000 in the way proposed, and the issue in this Government will be repudiation. And here, in advance, in my place, I avow the sentimentthat, in the event of that assumption, I am for an open, unqualified, and immediate repudiation of the whole mass. Now, sir, let that be written

H. of Reps.

down as the opinion and unalterable resolve of one Representative on this floor. Should that vast Trojan horse, with the engines of destruction concealed in his cavity, be introduced into this hall through a breach of the Constitution-the solid walls which fortify our liberty-there is no escape but in repudiation. If that remedy be not applied, this happy and glori ous Union will soon be forever severed in twain. The people of this country will never submit that the just shall suffer for the unjust, the prudent for the imprudent, the wise for the unwise. North Carolina will never submit to pay the debts of In. diana; nor will New Jersey agree to pay the debts of Pennsylvania.

Sir, no man feels more deeply for the Sales which are involved in debt than I do. No man sees more clearly the almost utter impossibility for several of them to extricate themselves from their financial difficulties. From my inmost heart, I sympathize with them; but may my tongue cleave to the roof of my mouth-may this heart (which, I trust, beats with some little patriotism) cease to pulsate-before one word of censure shall escape these lips, let them adopt what policy soever they may deem best. I doubt not their bonor; and, in their heavy embarrassments, they will do right. They have been cheated, deceived, misled. They have been lured, by the ignis faluus of bank credits, from the old paths of economy into the quag. mire of extravagance and profligacy; and now, in the hour of difficulty, the treacherous phantom vanishes into thin air. I will stand by the States; and I will palliate, excuse, and (as far as may be) justify their conduct. All of them together, and each separately, form my country: and the language of my heart is, May my country be always right; but, right or wrong, I will always stand by my country.

It is true, I say, that I cannot see how many of the States can pay their debts. No civilized nation, except this young giant, ever yet paid a foreign debt of any considerable amount. In some of the States, the exports-the surplus produce carried out of the State and sold-are about equal to the annual interest to be paid by such States. This interest will be so much subtracted from the active circulation. It is taken away, and no return is made for it. The rents and profits of farms, instead of being spent in their improvement and enlargement, will be carried away to the foreign lords of the manor. By this process, in a few years, the whole country would be involved in irretrievable and intolerable ruin. The entire debt of the States and cities, and Federal Government, is $279,388,760. The interest on this amount is $14,893,832. The whole export of domestic prod. uce, in 1841, from the United States, was $106,000,000. Of this amount, 14 per cent. is to be paid for interest. This will exceed by far the profits on the export. It amounts to 85 cents on every barrel of flour, and $4 25 on every bale of cotton. Sir, it is evident that it cannot be paid. The ef fort will most surely involve us more deeply in distress and bankruptcy.

Mr. Speaker, I verily believe that, with the exception of the United States, there is scarcely a civilized nation in the world able to pay her debts. Suppose the interest on the English debt payable abroad for one year; at the end of that time, that supercilious and haughty Government would be brought low in the dust, and would become one splendid but desolate wreck. Her bank circulation is not quite £20,000,000. The amount of her annual taxation is about £60,000 000, or $300,000,000. Her annual interest is £30,000,000, or near $150,000,000. Now, suppose this entire sum of interest were due the 1st day of January, 1844, to be paid to France or this country, Great Britain would be drained of every dollar of bullion she possessed, and, on the day of payment, there would be an awful crash of her whole paper system. The purchase of foreign corn, a few years since, caused such a drain of bullion, as to shake the Bank of England to its centre. Her advantage now is, that her debt-near $4,000,000,000-is due at home, and in the payment of tax, and then of debt, the paper money of the kingdom, based upon the credit of the Government, flows in a circle, ab