Distribution and the Public Lands
Distribution and the Public Lands from the Boston Quarterly Review for 1841
The subject of the public lands and their proceeds brought to our especial notice in the very able Report and Speeches we have enumerated is one of grave importance and deserving the serious consideration of every American citizen. On the decision respecting it to which Congress shall ultimately come it is perhaps not too much to say depends the purity the utility if not the very existence of the Federal Government.
While we are writing this article it is rumored that an extra session of Congress is to be called at an early day if so the subject before us can hardly fail to be one of the first and weightiest that will claim its attention. No apology then is needed from us to our readers for devoting at this time some considerable space in our pages to its free and full discussion.
The subject itself naturally branches off into two distinct inquiries each of which needs a separate answer 1. What disposition shall be made of the public lands lying within the limits of the new States 2. What disposition shall be made of the proceeds of the sale of the public lands? We shall confine ourselves for the present to the second inquiry.
Hitherto the proceeds of the sale of public lands have gone into the Treasury in like manner as the proceeds of the customs and been applied indiscriminately with the revenues derived from other sources to any of the wants of the government. But it is now proposed to discriminate between revenue derived from the sales of land and revenue derived from other sources and while the last may as heretofore be used to meet the demands on the Treasury the other must be reserved as a fund for distribution among the several States. In other words it is proposed to distribute the net proceeds of the sale of public lands among the several States in the ratio of their representation in Congress. This is what is called the policy of Distribution.
In considering this proposed policy of distribution it is very natural to inquire if there ever have been or if there are likely to be for some time to come at least any net proceeds of the sale of public lands to distribute. The proposition is to distribute net proceeds and it can take effect only in case that there are nett proceeds. There can be nett proceeds only on the condition that the receipts from the sale of the public lands exceed the expenditures of the government on their account.
Now in point of fact the public lands thus far have proved a dead loss to the United States. They have expended on account of these lands nearly nineteen millions of dollars over and above the gross receipts from their sale. According to Mr. Wright's speech which may be relied on for he copies from official records the whole actual cost of the public lands to the government up to the 30th of September 1839 excluding the expenses of various Indian wars which have grown out of treaties for their purchase and the execution of them by the removal of the Indians was one hundred thirty five millions fifty five thousand two hundred and twenty five dollars and four cents while the gross receipts of money for the sale of land up to the same date amounted to only one hundred sixteen millions one hundred ninety eight thousand one hundred and seventy nine dollars and fifteen cents leaving as will be seen a balance against the lands in favor of the Treasury of eighteen millions eight hundred fifty seven thousand and forty five dollars and eighty nine cents. This shows that the government has expended more than it has received. Till this excess of expenditure is reimbursed by the receipts from the sale of the public lands there can be no nett proceeds. It would seem then to be somewhat idle to talk of the distribution of nett proceeds among the several States at least for the present.
But waiving this fact conclusive in our judgment it is by no means impertinent to ask would Congress have a right in case there were nett proceeds to distribute them among the several States?
No man we presume whatever the complexion of his politics will contend that Congress has a right to lay and collect taxes for the express purpose of distribution. The taxing power of Congress is limited The constitution merely gives it power to lay and collect taxes duties imposts and excises to pay the debts and provide for the common defence and general welfare of the United States Congress may of course contract debts but only for constitutional objects. Consequently its taxing power is restricted to raising the amount of revenue necessary for discharging the constitutional functions of the government. Every cent of money collected from the people beyond this in whatever shape or under whatever pretence it may be taken, is wrongfully unconstitutionally taken.
Now, if Congress has no right to lay and collect taxes expressly for the purpose of distribution can it have the right to lay and collect taxes for the purpose of buying land with a view to selling the land and distributing its proceeds. Why may it not just as well distribute the revenue it has collected before it has been invested in the land as after it has returned into the Treasury from the sale of the land. Where is the difference We can see none in principle We conclude therefore that if Congress has not as it unquestionably has not the right to raise a revenue for distribution it can have no right to raise a revenue invest it in land then sell the land and distribute the proceeds.
But all the public lands to which the Indian title is extinguished that is to say all the land actually owned by the United States and from which money can come into the Treasury have been bought by the United States and paid for out of the Federal Treasury and of course out of funds collected from the people by taxation direct or indirect. These public lands then are only the peculiar shape in which a given amount of the revenue raised by taxation now exists What then is distributing the proceeds of their sale but distributing revenue itself. What is it in reality but taxing the people for the purpose of raising funds to be distributed in largesses among the several States Is the distribution of largesses among the several States among the objects for which Congress has a constitutional right" to lay and collect taxes duties imposts and excises"?
If we take the ground that these public lands are not revenue then we deny the right of the Federal Government to purchase them and vitiate its whole past proceedings in regard to them. The purchase of land beyond what is necessary for public uses is not one of the objects for which Congress has a right to lay and collect taxes The Federal Government can constitutionally justify its appropriations of the funds of the Treasury to the purchase of these lands only on the ground that the funds so appropriated do not cease to be revenue are not placed beyond the reach of application to the objects for which Congress has the right to tax the people. These public lands then if rightfully held are nothing but revenue the form more or less available in which the government has wisely or unwisely seen proper to invest a portion of its income. This admitted it follows as a matter of course that the same law must govern the disposition of them or their proceeds that would govern the appropriation of any of the other resources of the Treasury.
Admit then that there are,- as there are not,- net proceeds they belong to the same proprietor to whom belonged the revenues invested to the proprietor of the funds with which the lands were purchased. The lands were purchased with the funds of the United States in their united federal character The United States in this character furnish the funds make the investment transact the whole concern on their own account are liable for the losses and are they not then alone entitled to the profits. If so Congress has no right to appropriate the profits to any other objects than those to which it might have appropriated the taxes from which these profits are mediately derived.
On the ground which we have assumed namely that the public lands have been bought by the United States and paid for with the funds of the Federal Treasury which funds were collected from the people by taxation there is no escaping our conclusion that they and their proceeds are revenue and therefore applicable only to objects for which Congress has a constitutional right to raise a revenue Distribution among the States is not one of these objects consequently the policy of distribution of the proceeds of the public lands is unconstitutional and ought not to be entertained. But the advocates of the policy assume a different ground. They contend in substance that the United States in their federal united character are not the owner but the trustee of the public lands holding them in trust 1 For the payment of the public debt incurred by the war of the Revolution and 2 For the benefit of the several States in their separate individual character. The debt being now paid off they contend that the several States have a right to demand that the nett proceeds of the lands held for their individual benefit be distributed among them according to the ratio of their representation in Congress. Is this ground tenable?
The position here assumed is to say the least not tenable against the whole public domain but if at all only against that portion which was originally ceded to the Union by particular States. All that portion of the public domain included in the Territories of Iowa and Florida all lying west of the Mississippi in the States of Missouri, Arkansas and Louisiana and in the States of Mississippi and Alabama south of the thirty first degree of north latitude and which is by far the larger portion is without the limits of the territory ceded by particular. States and has been acquired by purchase from France and Spain and the Indian tribes and paid for out of the Federal Treasury with the funds of the United States This portion is of course owned by the United States so far as owned at all and not by the individual States It then cannot be held in trust for the purposes alleged.
The other portion of the public lands was ceded to the Union by particular States but these States did not convey a clear title to the land They ceded so far as the present question is concerned only the right to purchase the land of the Indian tribes who were its acknowledged owners Now the federal government so far as the Indian title does not yet remain unextinguished has bought these lauds and paid for them with the funds of the United States. It holds them by virtue of purchase from the Indian tribes and not by virtue of State cession The United States have bought them and paid for them with their own funds and why do they not own them as much as a man owns his farm for which he has paid and received a legally executed deed. So far as concerns the proceeds of lands sold we can see then no more claim the individual States can have to them in the case of this portion of the public domain than in the case of the other.
But admit, that the particular States making cessions did convey a clear title to the land as well as the right to purchase, still the claims of the individual States are invalid because they ceded their original claims to the United States for the common benefit of all the States, and not for their separate or individual benefit. Congress in their resolution of the 10th of October 1780 declare that the unappropriated lands which may be ceded to the United States by any particular State shall be disposed of for the common benefit of the United States. New York in the act of her legislature authorizing her delegates in Congress to cede to the United States her claims to the western territory enacts that the lands so ceded shall be and ensure to the use and benefit of such of the United States as shall become members of the federal alliance of the said States and for no other purpose whatsoever and in her deed of cession she cedes transfers and forever relinquishes to and for the only use and benefit of such of the States as are or as shall become parties to the articles of confederation all her right title jurisdiction and claim to the lands in question.
Virginia insisted upon a guaranty from Congress that the lands ceded should be disposed of for the common benefit of all the States which were or which should become members of the confederation or federal alliance and it was in consideration of the fact that Congress by their act of 6th September 1780 did recommend to the several States of the Union having claims to waste and unappropriated lands in the western country a liberal cession to the United States of a portion of their respective claims for the common benefit of the Union and in the belief that Congress would continue earnestly to press upon other States claiming large tracts of waste and uncultivated territory the propriety of making cessions equally liberal for the common benefit and support of the Union that she finally consented to make her cession. And in her deed of cession she stipulates:
"That all the lands within the territory so ceded to the United States shall be considered a common fund for the use and benefit of such of the United States as have become or shall become members of the Confederation or federal alliance of the said States. Virginia inclusive according to their usual respective proportions in the general charge and expenditure and shall be faithfully and bona fide disposed of for that purpose and for no other use or purpose whatsoever."
The other States follow the same principle and cede their claims for the same purpose that is that these lands may be a common fund for the use and benefit of all the members of the confederation or federal alliance of the States. This would seem to be enough The lands were ceded to the United States to constitute a common fund for their use and benefit Language could not be more explicit and if we recur to the circumstances under which the cessions were made we shall be satisfied that more explicit language could not be desired All these cessions with the exception of those made by North Carolina and Georgia and cessions from which nothing has been derived to the Treasury were made before the adoption of the present Constitution under the old articles of confederation Under the articles of confederation Congress had no fixed revenue or at least none to answer its wants It did not assess as the Federal Government may now its taxes directly on the people of the several States It merely determined on the amount of money it needed and made its requisitions on the several States leaving it to the States to raise their respective quotas in their own way by impost direct taxation or loan as they saw proper.
Now the States which had as individual States no claim to these waste and unappropriated lands desired them to be ceded to the Union as a common fund to meet as far as they would go these requisitions made by Congress on the several States. They did not ask the cession as affording a fund for defraying their own peculiar expenses incurred in their character of individual States but to meet those expenses which they incurred as members of the confederation that is to meet the expenses not of the separate States, but of the United States.
If we examine attentively the Virginia deed of cession we shall see that it was drawn up expressly to meet this view of the case Virginia in the first place stipulates that it shall be a common fund for the use and benefit of such of the United States as have become or shall become members of the Confederation or federal alliance of said States. Then to prevent all cavil she further stipulates that it shall be a common fund to be apportioned out to each State according to its usual proportion in the general charge and expenditure. This last stipulation at that time had a meaning which by the adoption of the Federal Constitution it has not now but it affords additional evidence that the intent of Virginia was that the lands ceded should be for the use and benefit of all the States in meeting this general charge and expenditure that is to say the charge and expenditure of the Union and therefore she stipulates that it shall be placed to the credit of each State according to its proportion of that charge and expenditure. This was precisely what the States making no individual claim to the western territory, demanded.
Maryland, New Jersey and the other states having no individual claims to this western territory regarded these lands which the other States claimed and subsequently ceded to the Union as crown lands a part of the royal domain and therefore after the Revolution as vesting in the United States. The legislature of New Jersey in their remonstrance to Congress against the exclusive pretensions of Virginia say we cannot be silent while viewing one State aggrandizing herself by the unjust detention of that property which has been procured by the common blood and treasure of the whole and which on every principle of reason and justice is vested in Congress for the wise and general benefit of the Union they represent. The same doctrine was put forth and still more strenuously urged by Maryland The legislature of New York in the act already referred to assign as a reason for authorizing the cession of her claims to the lands in question the fact that it is conceived that they ought to be appropriated as a common fund for the expenses of the war Mr. Madison in his correspondence as we have it in the Madison Papers everywhere speaks of the cession to be made as a cession to be made for the common benefit. These facts taken in connation with the language used in the deeds of cession render it absolutely certain that the lands were ceded as a common fund for meeting the expenses of the United States incurred in their united characternot as a fund to be divided among the States for defraying expenses incurred in their individual character.
It follows from this, that so far as the United States hold these lands under the deeds of cession executed by particular States they hold them for the common use and benefit of all the States and are bound to apply their proceeds to the expenses of the States incurred in their united federal character. They were ceded to the Union for the express purpose of contributing towards permanent revenue for the Union Congress has then no right to appropriate their proceeds to any other purpose. Taking these lands then and following the deeds of cession and allowing them to be all that the advocates of distribution contend we are still obliged to regard them as revenue of the Union and applicable to no purposes except those for which as we have said before Congress has the constitutional right to raise a revenue.
The next position assumed by the advocates of distribution is that these lands were ceded to the Union for the purpose of paying the debt incurred by the war of the Revolution and as that debt is now paid off they in equity at least revert to the States individually But admitting this was the purpose for which they were ceded the reversion can be only of the claims which were ceded that is to say of the right to purchase. The property in the land cannot revert for this property does not vest in the United States by virtue of State cession but of the deeds executed by the Indian tribes of whom the United States have purchased them with the funds of the Union. The cession moreover was entire and forever of all the right title jurisdiction and claim of the ceding States There is nothing in the deeds of cession on which to found a claim of reversion. Nor is there in the history of the times anything that shows that such was the understanding of the States making or of the United States accepting the cessions.
Furthermore the lands were not ceded for the express purpose of paying the debt of the Revolution nor any other specific debt. They were ceded for the general purposes of revenue which revenue might be applied to the extinguishment of the public debt or to any of the legitimate purposes for which Congress might raise money. It was believed at the time that these lands might be made a source of revenue to the Union and this was the ground on which the States not claiming them in their separate right demanded their assumption by the Union or their cession to it. This point we have already established Maryland would not ratify the articles of confederation till the cession of New York gave assurance that the western territory would become a common fund for the benefit of all the members of the federal alliance. The territory was ceded for the general purposes of revenue but as the public debt was then the great concern of the government there can be little doubt that it was hoped that its cession to the Union would contribute something towards extinguishing that debt at least towards paying the interest annually accruing on it or what is still more evident that the cession would inspire public creditors with confidence in the ultimate ability of the United States to meet all demands against them.
But, admit the lands were ceded to the Union to pay the public debt incurred by the war of the Revolution. We ask which debt? The debt incurred by the United States or by the individual States Each State incurred a debt of its own in that war besides the debt it incurred as a member of the Union. There was a United States debt and a debt of the individual States. These lands we do not find were ceded to pay these individual State debts but if any the debts of the United States This is rendered evident by the fact that both Virginia and Georgia stipulated as conditions of their respective cessions that Congress should reimburse them certain expenditures they had made on account of these lands in defending them against the British and Indians If the cessions had been made for the purpose of extinguishing the State debts these stipulations would hardly have been necessary. They were ceded then to meet the general expenses and to help discharge the common debt. This again confirms the ground we have taken that their cession was Sot the common benefit and renders it obligatory on Congress to appropriate their proceeds to the use of the States in their united capacity not in their individual.
Moreover though these lands were unquestionably ceded as they were solicited as a fund for the common use and benefit of all the States united and therefore capable of being applied to any of the purposes for which Congress might lay and collect taxes and to no others yet there were other reasons which had their influence. The States which had no claim in their separate right to these lands were jealous of the States which had The claims of one State also conflicted with those of another. The claims of New York were thought to cover all the territory claimed by Virginia and the deeds of cession executed by New York and Massachusetts cover the same identical territory. Back of all these was the claim of the United States which was considered by several of the States as preferable to that of any of the particular States How were these conflicting claims to be adjusted and the jealousies and heart burnings growing out of them to be allayed Evidently the most feasible way was for the particular States to cede their claims to the Union under guaranty that they should be disposed of for the common benefit of all the members of the federal alliance It was on this ground that New York passed the act to which we have referred an act which she entitled an act to facilitate the completion of the articles of confederation and perpetual union among the United States of America. On this ground too Congress resolved on the 6th of September 1780 that it be earnestly recommended to those States who have claims to the western country to pass such laws and to give their delegates in Congress such powers as may effectually remove the only obstacle to a final ratification of the articles of confederation But granting all that the advocates of distribution contend for it will avail them nothing They say these lands were ceded to the Union for the payment of the debt incurred by the war of the Revolution Be it so But these nett proceeds must equal the amount of that debt before there can be on the part of the States, any claim to reversion.
Now these lands have not as yet contributed one cent toward the payment of that debt Taking the lands ceded by the particular States to the Union and they are still in debt to the Union The Union has never derived a cent of clear income from them The expense of extinguishing the Indian title surveying bringing them into market and disposing of them had exceeded according to Mr Wright's statement on the 30th of September 1839 the gross amount of receipts from their sales one million one hundred seven thousand two hundred and six dollars and thirty nine cents Where is the reversion of remainder to the states There is as yet no remainder There can be none on the principles assumed by the advocates of distribution till this one million and over is wiped off nay not till the nett receipts of these lands shall have reimbursed the Union all that it has paid on account of the debt of the Revolution for which it is said they were held in trust.
We go a step further. We not only say that the ceded territory never has contributed a cent towards paying the debt for which it is alleged they were ceded to the Union but we say that under no circumstances can they reimburse the Union for what it has paid on account of that debt The debt of the United States at the conclusion of the revolutionary war in 1783 as near as could be ascertained was forty two millions three hundred and seventy five dollars the annual interest on which was computed at two millions four hundred fifteen thousand nine hundred and fifty six dollars This would make the present value of the debt with simple interest one hundred eighty two millions one hundred twenty five thousand eight hundred and twenty three dollars This is the sum now chargeable against these lands and which they must reimburse before the States can have any claim to a distribution of their proceeds on the principle contended for We will however abate the interest and take the debt as it stood in 1783 that is at forty two millions three hundred and seventy five dollars.
The whole amount of land ceded to the Union by particular States from which money could come into the Treasury according to Mr Wright's table was two hundred two millions four hundred sixty six thousand seven hundred and sixty five acres of which there remain now subject to sale one hundred five millions eight hundred sixty five thousand one hundred nineteen acres together with twenty six millions nine hundred twenty two thousand seven hundred and thirty one acres to which the Indian title is not yet extinguished The present value of this allowing nothing for extinguishing the Indian title and estimating the land at one dollar and twenty five cents per acre assuming the calculations of the committee on public lands as the basis of our estimate cannot exceed twenty three millions of dollars Suppose then the whole of this land shall be sold at the present government price which it cannot be it will discharge but about one half of the public debt rated at its value at the close of the war in 1783 Whence then is to come a remainder to be distributed among the several States?
But the advocates of the policy under consideration abandoning this ground assume another They abandon the right of the States to claim a distribution and contend only for the power of Congress to distribute the proceeds of the public lands among the several States according to its own discretion This power they deduce from that clause in the constitution which gives to Congress power to dispose of the territory and other property of the United States The clause in question reads:
"The Congress shall have power to dispose of and make all needful rules and regulations respecting the territory or other property belonging to the United States."
Does this clause p ive the power contended for It will be seen at once that it gives to Congress no power to dispose of the public domain which it does not also give it to dispose of the other property of the United States It has the same power to dispose of the public buildings docks and navy yards forts arsenals magazines shi s of war cannon arms of all descriptions naval stores and munitions of war that it has to dispose of the public lands Has Congress a discretionary power over the disposal of all this immense amount of property which according to some estimates cannot be less than two thousand millions of dollars Take the case suggested by Mr Calhoun Has Congress a right to select one of the religious sects of the country say the Methodist the Baptist the Presbyterian Episcopalian or Catholic and erect it iuto a splendid hierarchy by endowing it out of this ample fund Why not For the plain reason that the constitution prohibits Congress from creating a religious establishment Congress cannot then dispose of the public domain for objects prohibited by the constitution.
We proceed a step further. We are still borrowing from Mr Calhoun Would Congress for instance have the right to appropriate the proceeds of this territory to the Colonization Society or the Abolition Society in the first case with a view of christianizing and civilizing Africa and in the last case with a view of emancipating the negro slaves Here are great objects and good objects in the judgment of not a few Why has not Congress a right to make appropriations for their furtherance Simply because the constitution gives it no express grant of power for that purpose Here then is another restriction on the discretionary power of Congress It can in the first place dispose of the property of the United States for no objects prohibited by the constitution and in the second place for no objects which the Constitution does not expressly grant it power to make appropriations for.
This follows from the very nature of the Federal Government which is one not of general but of special powers The constitution is the enumeration rather than a limitation of its powers The government is not free to exercise all the powers of government not expressly prohibited but it is prohibited from exercising all powers not expressly granted specified enumerated It is not enough that there is in the constitution no express clause against the measure proposed but there must be an express clause in its favor before Congress can have a constitutional right to adopt it This is the only safe rule of construing the constitution The conclusion we have drawn then is inevitable The discretionary power of Congress over the territory of the United States is subject to the two limitations we have stated It may unquestionably dispose of that territory but for no object prohibited or not expressly authorized by the Constitution It can then appropriate the proceeds of this territory only to constitutional objects objects for which it has a constitutional right to make appropriations from the Treasury Distribution among the several States is confessedly not one of these objects consequently Congress has no right to distribute the proceeds of the public lands among the several States.
This reasoning we hold unanswerable and conclusive against the constitutionality of the policy of distribution Here then we might rest our case for we presume that there is no class of men amongst us willing knowingly and deliberately to run athwart the constitution There is yet we should hope too much respect for constitutional government remaining in the breasts of the American people to render this either feasible or safe Nevertheless the expediency of the policy and especially at this time is worth considering.
The reasons for advocating this policy are by no means recondite nor are they reasons which should be wholly disregarded Several of the States in prosecuting works of internal improvement in endeavoring to aid their banking institutions and the business operations of their citizens generally have contracted large and somewhat pressing debts Their credit is impaired their securities are at a ruinous discount and in some instances absolutely unsaleable In the complicated state of the credit system this operates greatly to the disadvantage not only of the particular states concerned but of business in general The resources of the country are to a great extent locked up and its energies crippled If we could revive and confirm the credit of these States abroad where the principal part of the securities are held we should throw these securities again into the market render them saleable without any serious loss enable the states issuing them to go on with their internal improvements to complete their public works and get the command of their resources enable the banking institutions whose resources are locked up in these securities to apply their capital to the general business operations of the country and in that way to save themselves and the merchants dependant on them from utter ruin give anew spring to trade cause business to revive and the country to prosper.
Distribution it is thought will aid this result in two ways The sum which will be distributed for it is proposed to distribute about three millions and a half annually to the several States will afford considerable relief to the embarrassed States and enable them to meet their more pressing engagements It will also tend to inspire confidence in the holders of State securities as to their value and ultimate redemption The depressed condition of these securities is owing chiefly to the loss of confidence in the ability or disposition of the States issuing them to redeem them restore this confidence.and they rise immediately to their par value generally and will be sought for by all who have capital to invest whether at home or abroad This done the evil is removed The increase of ability which distribution will give to the States and the policy it will indicate on the part of the general government in regard to the credit system of the country it is thought will restore this confidence.
These we suppose are the reasons which govern the advocates of distribution They are of course reasons not without weight and which may be supposed to be urged in good faith, and with patriotic views.
We very much doubt however whether the result desired would follow the adoption of the contemplated policy Our own opinion is that the credit system has been pushed too far that it is falling to pieces from its own inherent weakness and that all attempts to bolster it up will prove unavailing It is past remedy and the prescriptions of our State physicians are merely prescriptions to a body already in the agonies of death But let this pass as foreign to our present purpose. We still object to the policy because the end sought can be obtained at a less expense in another way.
Whence has come this loss of confidence in State securities So far as it is not the result of the inherent weakness of the system and therefore so far as confidence is capable of being restored it has come from the general persuasion at home and abroad that the last two administrations were at war with what is called the credit system This persuasion grew out of the means resorted to by the opposition to those administrations for the purpose of breaking them down and perhaps in part from the doctrines propagated by some members of the party generally supporting them The persuasion was in our judgment without any solid foundation But let that pass The public sentiment of the country has always been favorable to credit always in favor of the government whether State or Federal keeping faith with its creditors It is true that the doctrine has been put forth by here and there an individual that State loans are unconstitutional and that the people of the States are not bound to redeem them But this doctrine has few disciples and fewer still of those even who believe in the unconstitutionality of the loans would go so far as to recommend applying the sponge.
Several of the States we grant are deeply in debt but there is no State in this Union that has not ample resources for liquidating all its liabilities We will also venture to say that there is no State in this Union that is so lost to all sense of her honor as a State to say nothing of common honesty as to even dream of violating her faith with the public creditor If we believed there were such a State were she our own mother land we would disavow her and wish her blotted from the map of the Union In saying this we do but express the sentiment of the immense majority of the people of all the States The American people thank God have yet a strong sense of justice they have also a lofty pride of character that would induce almost every man to become a beggar sooner than consent see the government of his choice deliberately to keep its faith Let it be once understood as it may be now that the States have within themselves and they have the means of redeeming their and that they also have the disposition to do it confidence in their securities will be restored as far it is possible to restore it There is now no motive representing the Federal Government or its friends hostile to credit as desirous of embarrassing the operations of the country and we assure the holders State securities that they will never find a party in country of sufficient numbers to be counted that advocate the non redemption of those securities clearly and distinctly understood will have all the eficial effect on State Bonds that can be hoped for distribution The project of complete and entire assumption of State debts by the Union we presume no will venture to recommend The indirect and resumption by distribution of three millions and a will be insufficient and fail in its object It will be enough to relieve the embarrassments of the States yet these States will rely on it and hope its aid to get along without resorting to the measures required They will adopt a policy which will relieve no embarrassment and no confidence The indebted States must resort taxation This whatever temporary expedients may adopt must be resorted to at last and which tends to delay the resort to this but in aggravates the evil The sooner the indebted lay a tax on their citizens to meet their the better it will be for them the better for all Let the State provide for its liabilities out its own resources and its credit will rise much rapidly and be placed on a much more basis than it will be by any temporary aid it may from distribution of the proceeds of the public lands.
But we object to this policy on another ground The amount which it is proposed to distribute cannot be spared from the Federal Treasury We are told that there is a deficit in the revenues a considerable public debt accumulating and that Congress must be called together immediately to devise among other matters ways and means for meeting the demands on the Treasury for the ordinary expenses of the government Is it wise when such is the state of our finances already inadequate to our wants to diminish them by gratuitously distributing nearly one fourth of the ordinary revenue among the several States The deficiency that will thus be occasioned can be met only by a resort to additional taxation And the necessity of this resort to additional taxation will not grow out of the legitimate wants of the Federal Government but out of the wants of the State governments Why not then as taxation must be resorted to by one government or the other leave it to the State governments whose wants create the necessity Why shall the Federal Government be compelled to assume the odious character of tax collector for the States Was this the purpose for wbich it was created It is no mark of good statesmanship to say the least to create needlessly a necessity of resorting to taxation If we had a surplus in the Treasury more money than we needed then there might be some show of propriety in distributing it among tbe States but now when we have no more than we want and when we are even threatened with a deficiency to distribute three millions and a half strikes us to say the least as a piece of rather bungling
The deficiency distribution would create must be met by new imposts It will require us to raise the tariff of duties But this cannot be done without disturbing the tranquillity of the Union No wise man no friend of the Union it seems to us can wish to renew the painful and angry if not dangerous discussions on this subject which we have so lately passed through A tariff for protection will never again be submitted to Our manufactures do not need it our commerce is opposed to it Commerce wants freedom and our manufactures are able to protect themselves They are established on a permanent basis and if left to the ingenuity and enterprise of our citizens can compete successfully with those of the old world There is then in reality no reason for a tariff except for revenue The country will tolerate a tariff for no other purpose and there is no man who dares risk his reputation by proposing one directly for protection.
But, distribute three millions and a half of revenue create thereby a deficiency then cannot the friends of a tariff for protection urge the imposition of new or additional duties on the ground that they are needed for the purposes of revenue The Compromise Act as it is called is held sacred by the country but that act recognises the propriety of raising the ad valorem duty if required for the purposes of revenue Create then by distribution a deficiency in the revenue and additional duties may be imposed without disturbing that act This would be an ingenious way of keeping the letter of that act while violating its spirit Is this the secret of the policy of distribution Is it the old tariff interest that is at work here attempting to do indirectly covertly what it wants the courage the manliness to attempt openly directly So it would seem And yet the advocates of distribution are high minded and honorable men men who would scorn to be thought deficient in courage moral or physical and who would deem it gross injustice to be thought capable of attempting to carry any great measure of state policy by management, or trickery.
But suppose the policy adopted the deficiency created and supplied by an increased tariff of duties what will be the result Connected with this policy will be another the repeal of the Independent Treasury Law and the establishment of a new United States Bank or the revival with modifications of the pet bank system most likely for the present the latter This we will suppose done and that the whole policy succeeds according to the calculations of its friends The State Bonds will become saleable in the market the banks can avail themselves of their resources trade will revive and business will be brisk heavy importations will be made after the first or second year the duties on which will be deposited in the bank or banks during the period between collection and disbursement and made the basis of discounts The banks having in addition to their own capital the government deposit will discount freely which will have for its first effect to expand the circulation and appreciate prices This will neutralize the good effects of the tariff on manufactures It will also increase the profits as well as the means of importations The second effect will be to make large additions to the amount of foreign importations These additions will of course increase the revenue and of course the amount of government deposits and of course again the ability of the banks to enlarge their discounts This again will still further expand the circulation appreciate prices still more and in a word revive in all their aggravated features the ruinous speculations of 1835 and 1836 This is the inevitable result of the policy proposed in case it prove successful. Is this result desirable?
We know that it may be thought that individuals and banks have learned wisdom from their past experience but those mad speculations were not the effect of the madness of individuals nor of banks When prices were every day rising who could see where to stop in his purchases to sell again When the bank assets far exceeded its obligations and specie was readily obtained when wanted who could say where the bank ought to stop in its discounts We have blamed too severely both individuals and banks for the disastrous scenes of the years alluded to Individuals and banks were the victims of the combined operations of the tariff and paper money aided by the immense State and corporation loans abroad of nearly three hundred millions of dollars all of which were paid in merchandise imported to bloat the Treasury and to paralyze our home manufactures Adopt the policy you propose and if it succeed as you wish it will reenact the same scenes occasion the same mad and ruinous speculations and make the most prudent and sagacious of our business men and the honestest and best managed of our banking institutions their victims If our business men have learned wisdom from past experience they will not seek again to put into full operation the causes that produced the calamities from which they are now but slowly beginning to recover.
The business men, including the bankers of this country, are in what concerns their business as enlightened and as honest and high minded as those of any other country in the world They are among the elite of our population They are bold and adventurous but they are also prudent and sagacious Their failures or ill successes are seldom taking them as a body owing to their personal defects whether moral or intellectual They fail from the false systems of finance and currency under which they are obliged to operate The policy that has hitherto been pursued is what has ruined them Give them a sound a uniform currency give them an open field and fair play and we will set them whether in manufactures or in commerce against the world Let them abandon the narrow policy which ill comports with their bold and adventurous minds of striving to shut out other nations from the home market and go forth the rival of all nations for the markets of the world This is their true policy and let them pursue it but for a short time with then usual prudence and energy and the markets of the world are at their command They have done nobly under all the disadvantages they have had to struggle with What could they not do with those disadvantages those ruinous clogs on their enterprise, removed?
Commerce and manufactures are the two leading interests of the world the great civilizers of the race They have been the principal agents in raising the nations from primitive barbarism and if in looking over the map of the earth one spot strikes us as more luminous than another it is the spot where commerce and manufactures have had their seat In the ancient world the rays of light centre on the commercial republics of Phenicia Carthage Greece and her colonies and as you recede from these you retire into darkness They are and must be great and leading interests of this country they are to make this country what it will be and to give it its rank among the nations of the earth He who is hostile to them is hostile to his country nay to his race the enemy of freedom and civilization In opposing the policy under consideration we oppose not them we but oppose a policy which they need not and which must ever prove disastrous to them.
We also oppose the policy in question because at this time there is a peculiar need of husbanding all the resources of the Treasury to put our country in that attitude of defence which our foreign relations render imperiously necessary We are neither advocates nor prophets of war we do not seriously apprehend that there will be any war at present in which this country will be involved Commerce has so spread her meshes over the world so interwoven the interests of one nation with those of another that war every day becomes more and more difficult Still the era of peace has yet te dawn on the world and the time when it is no longer necessary to prepare for war has not yet come Our relations with Great Britain at this moment are by no means of the most friendly nature We have grievous wrongs to complain of and difficulties to adjust that will not be easily adjusted We can never yield to her claims on our Northeastern Boundary We cannot adjust those claims as some suppose by accepting an equivalent for the territory she demands We cannot give her the immense advantage in case of a war with this country of a military road from Halifax to Quebec an advantage equivalent to an army of some thirty or forty thousand men We can never yield to her encroachments on our Northwestern frontier for our territory must be retained entire We can never consent that the violation of our territory in a time of peace by an armed force as in the case of the Caroline shall pass without redress for we are an independent nation nor can we submit to the right of search and the seizure of our vessels on the coast of Africa or the high seas under any pretence whatever Our flag must protect our commerce and our ships Here are matters which bring us into direct conflict with Great Britain and will inevitably lead to a war with that power unless we show by our firmness by our military and naval preparations that we are both able and determined to maintain our rights If we would escape the calamities of war we must be prepared for it.
Our country is confessedly almost entirely without defence Our inland defences can be of little use in any new war and our seaboard is unprotected and liable at any moment to be laid under contribution by British steamers Is it wise then at this juncture to reduce the resources of the Treasury by distributing three millions and a half of the revenue among the States Is it wise when we are likely to want all the money that we have and when the people must tax themselves all they can bear for the purposes of defending our coast and protecting our navigation to throw away so large a portion of our resources We need all the money that we can raise from the customs and from land too to protect our country and to put it in an attitude to assert and maintain its rights and interests If then Congress had the power as we have shown that it has not to distribute the proceeds of the public lands among the several States it would be inexpedient and highly impolitic to do it Congress is called upon to appropriate the resources of the Treasury to higher and more urgent objects and as much as we sympathize with the depressed condition of the indebted States true policy as well as constitutional right requires us to leave them to their own resources which we cannot and will not believe will prove insufficient.
We here close what we have thought proper to say on the first branch of this subject For a further discussion of it we refer our readers to the Speeches enumerated merated at the head of this article especially to those of Mr Wright and Mr Calhoun to which we with pleasure acknowledge ourselves indebted for no small part of the materials which give to this article what little value it may have.
The consideration of the other branch of the subject, namely, the disposition which ought to be made of the public lands lying within the limits of the new States we are reluctantly compelled to postpone to a future occasion.