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equitable system adopted for the distribution of the public lands. Mr Clay said he rejoiced, that the question of the principle of distribution was now to be tested in a simple and a solemn manner. He met the opinion of the senator from South Carolina, that the division of the proceeds of the public lands would lead to the practice of distributing the proceeds of the taxes among the states by an opposite one; and declared his own firm and strenuous opposition to the principle of such distribution. He stated, that the revenue, from the public lands, was distinguished from all other revenue, by the language of the constitution and of the deeds of cession, which gave exclusive and unlimited power to congress over the public lands, and which was not given over any other revenue. This view was supported by the opinions of some of our ablest constitutional lawyers and if it was correct, the argument therefore, that the division of this revenue would lead to the division of all the surplus revenue, he did not consider as sustainable. He adverted to the argument, that the distribution of the gross proceeds would be a distribution in part of revenue, from other sources, and stated that the bill authorized the division of the net proceeds only. He detailed what would be the deductions made by the accounting officers under the bill, when they determined the amount of the proceeds applicable to division. The net amount of charges on the annual sales of the public lands did not, he believed, exceed four per cent.

He hoped, that the question of distribution would be settled, and in such manner as to redound to the happiness and prosperity of every state, and of consequence of the whole of the Union.

Mr Hayne briefly replied upon the subject of the discrimination between the revenue from the public lands, and from other sources and contended, that if the construction of the gentleman from Kentucky was correct, there was no limitation to the powers of the general government; and they might be exercised under a wild discretion, the extent of which could not be anticipated or controlled. He asserted, that there ought not to be any surplus money in the Treasury; but that care should be taken to regulate the taxes, so as to have no unnecessary amount in the Treasury. He denied, that he was anxious to increase the revenue from the public lands. He was willing to place them on a fair and equitable ground.

After further debate, in which Messrs Poindexter, Johnston, Kane, Holmes and Robinson took part the question on fifteen per cent, was taken and decided, yeas 20, nays 26.

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The question pending, being on the proposition of the committee on public lands, to strike out all the sections, which authorize the distribution among the states.

The question was taken by yeas and nays, and decided, yeas 21, nays 26.

Mr Benton then moved to introduce an additional section, reducing the price of public lands to one dollar per acre, and of

all which have been above five years in market, to fifty cents per

acre.

On motion of Mr Kane, the question was divided, and was first taken on the first branch of the amendment, as follows, yeas 21, nays 27. The question was then taken on the second branch of the amendment, and decided, yeas 20, nays 28. Mr Poindexter moved to amend the bill in the first section, by striking out ten, and inserting twelve and a half per cent. Mr Clay and Mr Holmes expressed their intention to vote for the amendment. Mr Tipton moved to insert fourteen per cent. The chair pronounced this motion to be out of order. Mr Hayne appealed from the decision of the chair. The question was then taken, when there appeared, yeas 23, nays 23. There being a tie, the opinion of the chair was sustained.

The question recurring on the motion of Mr Poindexter, it was decided, yeas 27, nays 20.

Mr Poindexter then moved to amend the bill, by adding a fifth section, granting to Mississippi, Louisiana and Missouri, 600,000 acres each, for purposes specified.

Mr Hendricks moved to amend the amendment, by adding so many acres to the grant of Indiana, Alabama and Illinois, as would make the aggregate given to those states, equal to the grants now asked for the other states.

The amendment to the amendment was then agreed to: and the question was taken on the amendinent, as amended and decided, yeas 28, nays 16.

Mr Hayne moved to strike out the words which specified the purposes to which the proceeds were to be applied by the states, so as to leave the states to apply the proceeds as they pleased.

It was contended by the opponents of the amendment, that the striking out of this limitation, would destroy the great object, and entire value of the bill.

On the other side, it was insisted, that the states would have a right to use the money as they pleased: and if they are disposed to apply it to internal improvements, education or colonization, they will do it in the absence of all limitations.

Mr Webster asked for a division, so as to take the question, first, on striking out the words 'of education and internal improvements;' and being taken on this branch of the amendment, it was negatived as follows, yeas 20, nays 27.

The question was then taken on striking out colonization, and negatived, yeas 22, nays 25.

Mr Benton moved to distribute the proceeds, according to the number of senators and representatives, which was negatived, yeas 13, nays 30.

Mr Robinson then moved an amendment reducing the price of all lands, which had been ten years in the market, to one dollar, and to actual settlers to fifty cents per acre. This was negatived, yeas 19, nays 24. Provisions were then added, that the appropriations for the Cumberland road should continue to be made out of the two per cent fund, and that the power of Con

gress to grant future donations of land, should not be impaired, and the bill was ordered to a third reading, yeas 23, nays 18. The next day the bill received its final passage, yeas 26, nays 18, and was sent to the House for con

currence.

The subject had already been examined in that body, and the committee upon public lands, through its chairman (Mr Wickliffe), had presented a report, recommending certain modifications in the land system of the United States.

The report altogether disapproved of the plan of the Secretary of the Treasury, to dispose of the public lands, to the several States within which they lie, and to divide the proceeds among the States. The proceeds are regarded as part of the public revenue, and the power to divide the same is denied by the report. Assuming it then to be the duty of the government to reduce the revenue to the reasonable demands of the public service, the committee declare themselves opposed to abstracting the proceeds from the revenue of the government; but urge that the price of the public lands should be reduced for the two-fold purpose; first, of reducing the amount of revenue derived from the sales thereof; and secondly, with the view of placing it more immediately within the power of every man, however poor, to acquire a home for his family.

The report adverts to the effects upon the Western States, of annually withdrawing so much money from the West, as the price

of these lands amounts to, and expending it in other portions of the Union, under the present system; and deprecates the state of things, which it declares to be inevitable, should the funds arising from the sales of the public lands, be divided in any form, and in any ratio, among the several States, for State purposes.

The report recommends, that Congress should retain the unrestricted control over the public domain, and that the national legislation over the same, should be guarded by a policy which shall regard it rather as a means to build up flourishing communities, than as a profitable source of revenue to the general government, or of wealth to the individual States. Upon this subject we will conclude this abstract, by quoting the language of the report itself, as follows.

"The general government should dispose of them upon terms accommodated to the wants of the community, and when the unsold lands in the respective States shall become refuse, and no longer worth the expense of federal superintendence and care, a relinquishment of them, to the State in which they lie, or to individuals, would be the better policy.

It is not probable that the government will again be placed in a condition, when it will become necessary to resort to her public domain, either as the means of raising an army, or borrowing

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policy to reduce the price of the public lands. Arguments other than the necessity of ridding the treasury of the revenue derived from sales at the present prices, in favor of a reduction of the price of the public lands, could be advanced, if that were the question now under the consideration of the committee. The price was reduced in 1821, from two dollars to one dollar and twentyfive cents per acre. Real estate, in common with every other species of property, has decreased in value since that time. The price of labor has lessened. The appreciation in the value of the circulating medium, since 1821, has been very considerable, and still the price of the public land is the same now as then. It should not be forgotten, either, that in most of the new States, the best and choice lands have been sold.'

With a report thus conflicting with the views embodied in the bill from the senate, it would have been difficult to have satisfactorily adjusted the details of a bill, so

as to have reconciled all parties, at that late period of the session. Still, however, it was deemed important to have an expression of the opinion of the House on this question, and a disposition was manifested by the friends of the bill, to press for a decision.

This was not acceptable to the friends of the administration, and with the view of avoiding any decision, they concluded to urge its postponement to another session. A motion was accordingly made by Mr Wilde on the third of July, to postpone the further consideration of the bill, until the first Monday of December next, which was equivalent to a rejection of the bill. This motion was carried, yeas 91, nays 88, and a motion made the next day by Mr Condict of New Jersey, for a reconsideration, was negatived, yeas 88, nays 100.

The subject was thus postponed, and it remains for future adjustment, as one of the great unsettled questions of American politics.

CHAPTER VI.

Course

General Remarks. Currency of new Countries. Continental Money.-Power to regulate Currency vested in Congress. — History of Banking in the United States-Paper Currency substituted for Metallic. - State of Currency during the War of 1812. United States Bank established. Specie payments resumed.— Banks in Tennessee and Kentucky. Relief party. - Present condition of the United States. Course of Commerce. - New States deficient in Capital. Effect of a National Bank.- Sound Currency established. Rate of Exchange diminished of Exchange. Constitutionality of National Bank-Hostility to Bank Errors in Management-Attack upon Bank in message of 1829-Effect upon Stock - Reports adverse to Message -Attack renewed in 1830 and 1831-Renewal of Charter asked-Bill reported in Senate 1832-In House-Committee of Inquiry appointed - Discussion upon Inquiry — Reports Reports - Bill taken up in the Senate - Amendments Bill passed- Taken up in House-Amendments - House passes Bill - Senate refuses to Adjourn - Veto of President - Discussion on VetoBill rejected.

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IN new countries one of the chief difficulties, with which a civilized population is obliged to contend, after a sufficiency is obtained of the necessaries of life, is in appropriating a portion of their capital, to serve as a common standard of value in the transactions of commerce. Barter, which is always the first process, soon becomes too burdensome, and the precious metals, which in older countries furnish a sound and universal currency, are too expensive for new settlements, where all the capital of

the inhabitants is wanted in improving the face of the country, and in providing additional comforts as the community advances in wealth. In the course of time, however, commerce claims a portion of capital as the medium of exchange; and the struggle commences between the necessity of providing a circulating medium, formed of a material of universal value, and the reluctance to spare for that purpose, capital, which might be exchanged for articles essentially wanted in new countries. Hence it is found, that in

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