The Register of Pennsylvania : devoted to the preservation of facts and documents and every other kind of useful information respecting the state of Pennsylvania, Vol. IX, Part 92

Author: Hazard, Samuel, 1784-1870
Publication date: 1828
Publisher: Philadelphia : Printed by W.F. Geddes ;
Number of Pages: 440

USA > Pennsylvania > The Register of Pennsylvania : devoted to the preservation of facts and documents and every other kind of useful information respecting the state of Pennsylvania, Vol. IX > Part 92

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cognizance either of their consistency or of their po- litical purity. They are responsible for their opinions to their subscribers and to the publie opinion of their country. To hold them to this responsibility, their ri- vals, and competitors, and political adversaries, are suf- ficiently watchful, and sufficiently armed. The opi- nions and interests of majorities in Congress will never lack for presses to sustain themselves. But if, in addi- tion to that common interest of the majority and of their favorite presses in the competition for public favor, they are to assume censorial power to punish or to stig- matize the editors who support the interests of the mi- nority; in what does this differ from an imprimatur in the hands of the governing power-an engine for the suppression of all freedom of the press, as well as for the oppression of every editor, whom it may suit the purposes of the predominant party to discredit or de- stroy.

Entertaining these opinions, and believing that the principle on which they were founded had been sanc- tioned by the House itself in the resolution, as adopted, for the appointment of the committee, the subscriber did earnestly, though ineffectually, resist and oppose the call by the committee for the accounts with the bank of editors of newspapers. To all persons of that highly respectable and important profession, their ac- counts in bank were, as well as to other members of the community, their private and domestic concerns, which no power to examine the books and proceedings of the bank could authorize a committee of this house to ex- pose to public gaze. Tosingle out the editors of news- papers for this invidious exposure was, in the opinion of the subscriber, to disfranchise them of their rights as citizens and as men, and was to assail them in their re- putation, their interest, and their credit. Not for the purpose of bringing them to trial by jury, where they might defend themselves, their fortunes, and their cha- racters, in presence of their peers, but to hold them up ag accomplices in corruption with the bank. To ac. complish two objects hy one operation-to defame the bank by colorable charges of corruption, which it would never have an opportunity to repel by a fair trial, according to the laws of the land-and to defame any editor of a newspaper having an account in bank, whose politics might be opposed to a majority of the commit- tec, instigated by the rivalry and hatred of antagonist editors of other newspapers in the same city, or neigh- borhood.

The majority of the committee did, the subscriber doubts not, with pure intentions, otherwise decide, and the accounts of editors of newspapers with the bank were called for. In reviewing this decision, and the proceedings of the committee subsequent upon it, he deems it his duty to declare, that none of his objections to it have, in his judgment, been removed. Ile views it as a precedent of portentous evil; as an unjustifiable encroachment of arbitrary authority upon the freedom of the press; as an ndious persecution of individual citi- zens, to prostrate the influence of personal or political adversaries, by the hand of power.

Of the class of accounts thus produced, those of one newspaper establishment only underwent the investiga- tion of the committee. Those of James Watson Webb and Mordecai M. Noah, editors of the New York Cou- rier and Enquirer, one of the most distinguished and extensively circulated journals of the Union. Mr. Webb was examined upon oath by the committee at his own request. Mr. Noah transmitted to the committee his own affidavit, made before a magistrate of the city of New York. Mr. Silas E. Burrows, a private citizen, not an editor of a newspaper, but connected with the responsibilities of Messrs. Webb and Noah in the bank, was subpoenaed to appear before the committee, but as the subscriber believes, with a just estimate of his own rights, did not give his attendance. No proposal was made in the committee to issue a compulsory process against him. As editors of a public journsl, and in that

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character as guardians and protectors of the freedom of the press, the subscriber is of opinion that neither Mr. Webb nor Mr. Noah ought to have appeared in person or by affidavit, before the committee. If in their trans- actions with the bank they had committed any violation of law, they could not be examined as witnessess to criminate themselves; if they had committed no viola- tion of law, the inquisitorial powers of the committee did not extend to them. Their transactions with the bank, unforbidden by the law of the land, were no more within the lawful scrutiny of the committee, than the dwelling-house, the fire-side, or the bed-chamber of any of them. These, even in the darkness of heathen antiquity, were the altars of the household gods. To touch them with the hand of power is profanation. As- sailed, however, in reputation, as they already were, and had been, on account of these transactions, by their po- litical enemies and the enemies of the bank, from false and exaggerated rumors concerning them which had crept into public notice, it was certainly not unnatural, and perhaps not improper in them, to state in full can- dor and sincerity, what their transactions with the bank had been.

From these it appeared that in August, 1831, James Watson Webb obtained at the Bank of the United States a loan of twenty thousand dollars upon his own note, endorsed by Mordecai M. Noah.

Washington. The depositions of Isaac Wright, Presi- dent of the City Bank, and of Albert Gallatin, Presi- dent of the National Bank, at New York, were accord- ingly taken and transmitted to the chairman of the com- mittee. They did not in the slightest degree impair the testimony of either Mr. Webb or Mr. Noah. On the contrary, they confirmed, so far as they could con- firm, that part of thei revidence which it had been the purpose, in requiring the affidavits from the two N. York banks, to invalidate.

They proved that at both of those banks, in July, 1831, notes offered for discount by James Watson Webb, with an endorser of unquestionable credit, were rejected. The reasons of those rejections, both the Presidents of the Banks, with great propriety, declined to give. They state that at one of the banks no note is discounted, if objected to by any one member of the Board of Directors. At the other Bank, any note is rejected to which two of the Directors concur in object- ing, and that no Director is required toassign any rea- son for his objection to any discount. In these answers of the two Presidents, the subscriber cannot forbear to remark a demonstration of the impropriety of the call by the Committee upon those gentleman for their testi- mony in this case. The object of the call was to im- peach the truth of the testimony given by the two wit- nesses, Webb and Noah, upon oath before the Commit- tee-witnesses whose veracity stood as fair before the Committee as that of any other citizen of the communi- ty, and who, in the opinion of the subscriber, could consider the call itself on the Presidents of the New York banks, to contradict them, in no other light than of a gratuitous and wanton insult upon themselves. Of the fact that notes offered by Webb had been rejected at the N. York banks no doubt was or could be entertained. The reasons of the rejection were avowedly inferences of Mr. Webb and Noah, which might even have been incorrectly drawn by them, without impeachment of their veracity. The Committee could not, in the opi- nion of the subscriber, possess the right of calling upon the Presidents of the New York banks for the reasons of their refusing discounts to James Watson Webb, or to any other man. The call itself was a violation of in- dividual right, and the refusal to answer it, though in terms entirely respectful and dispassionate, carries with itself a censure upon usurped authority, not undesery- ed.

The application for this loan, made in person by Mr. Webb, was sustained by a letter from Mr. Noah, and sundry statements relating to the pecuniary condition and credit of the New York Courier and Enquirer. The letter from Mr. Noah was enclosed to the president of the Bank by Walter Bowne, Mayor of the city of New York, who had been one of the earliest directors, of the bank, with a recommendation of the application itself, to be considered as a business transaction. It was so considered by the board of directors who acceded to the loan desired. But the editors of the Courier and Enquirer had long been, as they still are, ardent and ac- tive political partizans, and their newspaper has been, and continues deeply immersed in that portion of poli- tical affairs immediately connected with elections. The peculiar character sustained by the paper and its editors, at the time when this application for a loan was made, was that of devoted friends to the present administra- tion, and particularly to the eminent citizen at its head. This character they and their paper still retain. . They have, of course, numerous adversaries of the opposing To this call upon the presidents of the New York banks, the subscriber had another objection. The chair- man of the committee had, by an act of Congress, au- thority to administer oaths to witnesses, and the commit- tee had received from the House, authority to send for persons and papers. But the subscriber did not consi- der the committee as possessing the power of delegating to other men authority to take depositions from persons whom the committee were authorized to call before themselves, and to hear in person. No member even of the committee, other than the chairman, was authorized to administer an oath. To administer oaths to witnesses was in the competency of the chairman specially author- ized by statute. To send for the persons and papers existing, was in the competency of the committee, au- thorized by the House. But to direct to be taken, and to receive as testimony depositions of persons whom the committee might have summoned to appear and testify before themselves, was, as the subscriber believed, to transcend their lawful authority, and to set a precedent which would lead to most pernicious abuses. This en- croachment of power could not be justified by the re- quest of the chairman of the committee to the depo- nents, that James Watson Webb and Mordecai M. Noah, the persons whose testimony it was supposed these depo- sitions would discredit, should have notice of the time and place, when and where they should be taken. To give notice of a deposition to be taken to impeach the testimony of another is the duty of a party to a cause, party, and numerous rivals in their own. Sometime be- fore this application for a loan from the Bank of the United States, there had been between them and some of their competitors for party and public favor, a news- paper war, with regard to the conduct of their journal and the opinions of its editors with reference to the Bank of the United States. In all this the interests of rival printing offices, and rival banks, may without breach of charity, be presumed to have been very wil- ling auxiliaries to editorial virtue and the unsullied pu- rity of the public press. The politics of the paper had been, or were thought to have been, successively hos- tile and friendly to the Bank of the United States. In this state of things, it is stated by Messrs. Webb and Noah, that two or three of the banks, in the city of New York denied them the accommodation of loans which they had previously yielded, and refused to discount for them paper of unquestionable credit. They affirm that these city banks, in punishment of their friendliness for the Bank of the United States, withdrew from them fa- cilities previously extended to them, and required the repayment of a large accommodation loan for which they were indebted. To discredit these imputations, re-af- firmed by Messrs. Webb and Noah, in their testimony upon oath before the committee, a majority of the com- mittee deemed themselves authorized to send a commis- sion and request the presidents of the two city banksin New York, to make affidavits before a magistrate, giving notice thereof to Messrs. Webb and Noah, and to trans- | and not of the deponent himself. The witness whose mit those affidavits to the chairman of the committee at testimony is to be discredited cannot be bound to re-

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ceive a notification from the witness called to discredit him. The volunteering of a committee to send forth mandates in search of contradictory evidence, to fasten imputation of perjury upon witnesses of veracity, before them unimpeached, has,in the view of the subscriber, an aspect too unjust and odious in itself to be legitimat- ed by any notice given to the witnesses thus outraged in their feelings and their rights. The whole procedure was, in the opinion of the subscriber, unlawful and un- just. Ile recorded against it his vote upon the journal of the committee; and he deems it his duty to repeat his protestation against it in this report.

But whatever may have been the true state of the re- lations between Messrs. Webb and Noah, and the local banks of New York, it was with these statements and al- legations that Mr. Webb, in August 1831, applied to the president and board of directors of the Bank of the United States, for an accommodation loan of twenty thousand dollars. The president and directors consi- dered it as it had been viewed in the recommendation of the Mayor of New York-as a business transaction. Yet, it did not escape their attention that a political co- loring might, and probably would be liable to the charge of a favor dispensed, to purchase the aid and support of the newspaper, in behalf of the bank; and if it should be denied, it would be charged as proof of hos- tility to the administration of the General Government and its chief. Sure that they could in no event escape the censure of enemies predisposed to blame, they granted the loan, to which, afterwards, in December, an addition of fifteen thousand dollars wasmade. Notes of Mr. Webb, endorsed by Mr. Noah, and payable to Silas E. Burrows, had been previously discounted for Mr. Burrows, but without the knowledge of Webb or Noah, as they testify, to the amount of seventeen thou- sand dollars. Of these sums so much has been paid, that there now remains due from Messrs. Webb and Noah, to the bank, a sum of about eighteen thousand dollars, payable in semi-annual instalments, and from the statements laid before the committee, believed by the subscriber to be as safe as any other debt upon the books of the bank.

The transactions of James Watson Webb and of Mor- decai M. Noah, with the Bank of the United States, formed, in the opinion of the subscriber, no proper sub- ject of examination by the committee, or of investiga- tion to the House, further than to ascertain, whether, in those transactions, there had been any violation of the law of the land. Within the pale of the law, if this be a Government of laws, and not of men, Webb and Noah were not amenable for their conduct, or their opinions, to the llouse of Representatives of the United States, or to any committee by them appointed.

In behalf of the United States, as large stockholders in the bank, a general superintendence over the pro- ceedings of the president and directors of the bank, is, no doubt, vested in the Congress. But the subscriber does not believe that the president, or any director of the bank, is, or can be accountable, to a committee of ei- ther House of Congress, or to the House itself, for the motives or reasons upon which he acceded or objected to any one discount. The practice of all well-regulated banks is, and must be, that declared by the testimony of the presidents of the two banks in New York to be theirs. The reasons or motives for accepting or reject- ing a note offered for discount, are not subjects of in- quiry at the board itself. The reasons of each director are in his own breast. His own colleagues at the board have no right to inquire into them. They are in his own discretion.

press-and these accommodations to Messrs Webb and Noah were understood to be among the most prominent exemplifications of that nameless crime whichi an inves- tigation of the affairs of the bank would disclose to the world. It would happily be a fruitless search to find in the criminal code of this Union, or of any one of its constituent States, such a crime as subsidizing the press. When the charge was first brought forward by the chairman of the committee, in the House, it was impos- sible to ascertain of what overt or covert acts this of- fence, thus novel and undefined, consisted; nor, except in the proceedings of a majority of the committee, can the subscriber yet comprehend what are the elements of this new and still undefined offence. The majority of the committee, immediately after entering upon the dis- charge of their duties at Philadelphia, commenced a search into all the accounts with the bank, of editors of newspapers. In the returns to this demand, it was found that Webb & Noah, far from being solitary cul- prits in this unheard of transgression, were in the very respectable company of the editors of the National In- telligencer, of the National Gazette, of the United States Telegraph, of the Globe, and of the Richmond Enqui- rer. This information was scarely in the possession of the committee before it found its way into the public journals, and thus all the editors of those well known prints stand, by an exhibition of their private accounts, charged before the public as conductors of presses sub- sidized by the bank. The committee did in no other in- stance than that of the New York Courier and Enqui- rer, go into an investigation of the reasons or motives for which the discounts or the loans had been granted. Political motives were unequivocally and explicitly dis- claimed by the president and directors, who assented to the loans; and while in this, as in all other banks, the practice is uniform of never assigning the reasons either for discounts or rejection, they are not and cannot be made subjects of testimony. Every member of the board has his own reasons, which may not be known to any other member. One member, therefore, is not re- sponsible for the reasons of any other member; nor is the board responsible for the reasons of any one of its mem- bers. Motives can be made a subject of scrutiny only upon suspicions-political suspicions, sharpened by the collisions of personal pecuniary interests.

The subscriber believes all inquiry into the motives of bank facilities or accommodations, to be not only pregnant with injustice to individuals, but utterly be- neath the dignity of the Legislature. Their rights of inquiry are commensurate with the law. For actions within the bounds of law, to serutinize motives, is tan- tamount to an inquisition of religious opinions-a spe- cies of moral and intellectual torture, fitted more to the age of Tiberius Casar at Rome, than to the liberal spirit of the present time. The discount of notes at a bank, whether to a large or small amount, can in no case be considered as donations or gratuities. They are con- tracts of mutual equivalents for the benefit of both par- ties, in which the bank is no more the benefactor of the customer than the customer of the bank.

As the period of time is approximating at which the present charter of the Bank of the United States is to expire, the question, with regard to the renewal of its charter, has become an object of great and increasing public interest. The duties of the president and direc- tors of the bank, to protect and promote the interests of the stockholders naturally, make it an object of intense and earnest desire to them. Independent of all person- al and individual interests of their own, these obligations to the company require of them to use all fair and law- ful means to obtain a renewal of the charter. Were it even true that under these circumstances, they should indulge a disposition to the utmost bounds of liberality, consistent with justice and discretion, to one or more eminent editors of public journals, but extending only to discounts of their papers, at the regular remunerating

It is indeed within the bounds of possibility, that this discretion should be abused to the injury and damage of the stockholders. But in the transactions of the bank with Webb and Noah, no loss or damage has occurred to the stockholders, nor is any to be apprehended. In the original charges presented to the House by the chair- man of the committee, there was one of subsidizing the | interest, at the rate of six per cent. interest by the year,

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is this to be construed into corruption or converted into a bribe? In every state in the Union there is a large capital of its citizens invested in stocks of multiplied state banks. Most of these are rivals in business with the Bank of the United States, and they have all boards of directors, and most of them are colleagued with news- papers, all eager for the destruction of the Bank of the United States. An institution doubly obnoxious to the system of safety fund banks in the state of New York; inasmuch as their discounts, at the rate of six per cent. a year, curtail one per cent. of the dividends which otherwise, by the laws of New York, they would be en- abled to levy upon the community. It is, therefore, not surprising, that in the city, and even in the state of N. York, that animosity against the Bank of the United States, of almost all the local banks should have been so great as even to spread its influence into the legislature of the state. The same operation is active under feebler excitements in many other states, These are not bribes. But the concert of opposition from state banks, in al- most every quarter of the Union organized with harmo- nious energy, in concert with public journals, perhaps as numerous, and constantly operating upon the public mind unfavorably by means of the press, made it indis- pensably necessary for those to whom the welfare of the corporation was intrusted, to defend themselves occa- sionally, and from time to time in the same manner,

If, while hundreds and thousands of the conductors of state banks, impelled by private and personal inte- rests, are filling the popular public journals under their influence, by means of discounts and facilities granted or withdrawn, with every change that suspicion can conceive, or imagination can invent, to invoke popular resentment and indignation against the Bank of the United States, to prevent the renewal of their charter, the president and directors of the Bank of the United States, are forbidden all use of the public press, for the defence and vindication of their own institution, they stand indeed in fearful inequality of condition with their adversaries before the tribunal of public opinion. The local banks of N. York, for example, grant, with lavish hand, bank accommodations and facilities to the editor of a daily newspaper, who fills his columns with all the common-places of vituperation against the Bank of the United States. They deny all facility and accommoda- tion to another editor, who admits into his paper essays or communications favorable to that bank. Does the editorial votary of state banks, and seven per cent. in- terest, slacken his fervor? his discounts at the state banks are curtailed: Does he falter in his zeal? a pres- sure for money comes upon the state banks, and his notes are called in. Does he dare to admit into his pa- per a communication favorable to the mammoth bank? he loses all credit with his old bankers. Does he pre- sume to hint, in an editorial article, that, after all, a bank bound to discount at the rate of six per cent. inte- rest, may be of some advantage to borrowers in a com- munity, where the established legal rate of interest is seven? he becomes at once, in the estimation of the lo- cal bank directors, insolvent, and blasted in credit, and, if he offers for discount, a note of a hundred dollars, with the best endorser in the city, it is rejected by the silent vote of one or two directors, because the editor's newspaper did formerly oppose, and now ceases to op- pose, the re-chartering of the Bank of the United States. And then, if the editor, cramped and crippled in his business by the screw thus put on his press, to save him- self and his establishment from ruin, applies to the pre- sident and directors of the Bank of the United States for an accommodation loan? No-they too must regard him as insolvent, and blasted in credit-they too must withhold all banking accommodation and facility from him, though recommended by the Chief Magistrate of the city of New York himself, or they will be guilty of the atrocious offence of subsidizing the press.

This statement of facts is here hypothetically put-it is - not intended to charge the presidents and directors of

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The Register of Pennsylvania : devoted to the preservation of facts and documents and every other kind of useful information respecting the state of Pennsylvania, Vol. IX, Part 92

Author: Hazard, Samuel, 1784-1870 Publication date: 1828 Publisher: Philadelphia : Printed by W.F. Geddes ; Number of Pages: 440

Author: Hazard, Samuel, 1784-1870
Publication date: 1828
Publisher: Philadelphia : Printed by W.F. Geddes ;
Number of Pages: 440