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Such were the principal governmental regulations of the colony of Con. necticut, which was less disturbed by those conflicts of faith and doctrine, and remained more equably pure and true to the original principles of the puritans, than
any other of the New England colonies. And down to this present time we may trace the beneficial effects of what we are now apt to term “ their bigoted enactments." They were like the early discipline of a child in the faith and precepts of religion and virtue. They stamp their impress upon the heart; and manhood, with the wisdom brought by experi. ence and reflection, only removes whatever of error, superstition, or bigotry, may have accompanied their inculcation, while the vital principle itself remains to preserve from vice and infamy. Just so has it been with the in. fluences set in operation by the puritans in Connecticut; nor is there any other portion of our now extended territory, where the religious virtues have so powerful an ascendancy, or where the whole moral character is developed in more beauteous and attractive proportions, or where we can mark so little deviation from the principles and practical piety of our fore. fathers. There the seed sown by them seems to have fallen on its most genial soil. The errors, superstitions, and imperfections, which necessarily attended their early, and not well instructed, because persecuted, zeal, have gradually faded away before the progress of knowledge and refinement; and she retains only the simplicity and sincerity of their devotion, the steadfastness of their faith, and, running through all her institutions, purity and integrity of their principles. Her political fabric is the least complicated of republican forms. Her society is framed under the wisest and the best of human regulations. Her sons are among the steadiest, he most fearless, and yet the most unostentatious of patriots. Her daughters the most virtuous as wives, and the most Roman as matrons. What part of our union does not at this moment feel and acknowledge her in. fluence?
In pursuing the history of the New England division of our continent, there is yet another colony whose rise and progress demand our attention. It has already been observed that the “ Colony of Massachusetts Bay" was early and often distracted with “sects and heresies" among themselves. In the year 1631, one Roger Williams, of Salem, promulgated substantially the following sentiments. That such persons as had held communion with the church of England should openly confess their error; that saints ought not to hold communion with sinners either in worship or oath ; that it was unlawful for unregenerate persons to pray; that the civil magistrate ought not to interfere in matters of religious faith and practice; that intoleration is persecution; and, that the patent of the king, disposing of the lands be. longing to the natives, without their consent, was unjust and void.
Mr. Williams was summoned before the general court on account of these sentiments, and subsequently banished from the colony. Collecting a few followers, he proceeded southward as far as the ocean and Narragan. sett Bay. Cultivating a friendly disposition with the natives, he gained an opportunity to explore the country, and settled at a place which he called Providence, in 1636. About two years from this period, the famous Mrs. Hutchinson commenced her career in promulgating what was called "the antinomian heresy," maintaining "that faith alone, without works, would secure salvation.” She, with a number of followers, was also banished from the colony. They proceeded to providence, and associating with Williams and his followers in a civil compact, purchased from the Indians VOL. III.NO. V.
the island of Rhode Island, March, 1638. In the course of the year fol. lowing they planted Newport. They soon found, however, that a title de. rived from the natives was not sufficient to protect them against the claims and the encroachments of Massachusetts ; and feeling the necessity of a higher right to their settlements, in order to establish a form of government which would be respected by the older colonies, they sent Roger Williams to England, to petition the crown for a patent. The Earl of Warwick granted him a charter of incorporation of " Providence Planta. tions," in 1643, which was confirmed by the two houses of parliament, in 1644, (“Charles the First having been driven from the capital.") An as. sembly, composed of the freemen of the several plantations of Providence, Newport, and Portsmouth, convened under this charter in 1647. It vested the legislative power in a court of commissioners, to consist of six persons, chosen by the several towns then in existence. The executive power was vested in a president and four assistants, who were chosen from among the freemen, who also formed a court for the administration of justice. Each township chose a council of six persons for the regulation of its own pri. vate affairs, and for the settlement of trivial controversies. They continued under this form of government until after the restoration. In 1663, they obtained a new charter from Charles II. under the name of " The Governor and Company of the English colony of Providence and Rhode Island Plan. tations in New England, in America,” which placed the colony on a foot. ing with Massachusetts and Connecticut, and led to the establishment of a friendly intercourse between them. Under this charter, the executive power was vested in a governor, deputy governor, and ten assistants, elected by the freemen. The legislative consisted of a general assembly, composed of the governor, deputy governor, ten assistants, and delegates from the several towns. Newport sent six delegates to this assembly; Providence, Portsmouth, and Warwick, four; and each of the other towns, two. The governor, or deputy, with six assistants, were always present. The general assembly had power to enact laws, admit freemen, choose officers, to esta. blish courts of justice, to punish offences, and do whatever was necessary for the common defence of the colony. The most remarkable feature which distinguished this from all the other colonies, was unqualified religious toleration. It was provided " that no person should be in any wise molested, punished, disquieted, or called in question, for any differences of opinion in matters of religion.” This is the first recognition of the right of liberty of conscience and freedom of worship, which we find in the charter regulations of any of the colonies, and does honor to the memory of the king from whom the charter was obtained. Amid the conflicting opinions of different historians, we will not cast reproach upon the memory of the colonists, by supposing that in their legislative provisions they ever departed from these liberal provisions. It is true that they expressly prohibited sports and labor on the Sabbath, but this can hardly be regarded as an act of intoleration. They continued under this charter, with some in. terruptions, down to the time of the American revolution; and even to this day, it is regarded as the fundamental basis of its government in the state of Rhode Island. The governor, assistants, and deputies sat as one house till 1696, when it was enacted that the house should be divided, the gov. ernor and assistants constituting the upper branch, and the delegates the lower. None but freemen of the colony were allowed to vote at elections which they might do either in person or by proxy
Such, as we have attempted successively to trace them, was the origin, and such the general governmental regulations of the colonies of New England. Here we close this view, which we have made the second part of our gvernmental history. It cannot be that we have gone over it without interest or instruction. We have seen the" wilderness bud and blos. som as the rose," and the solitary place made glad with the voices of in. dustry, civilization, and religion. We have seen a wild, inhospitable, and forbidding continent converted into a cheerful, inviting, and growing garden of freedom and independence. We have seen the pure principles of liberty and religion, thrown out from among the discordant elements of civil and ecclesiastical tyranny and usurpation, spring, as it were, into new life, and like their great Author, when first he communicated them to man, without a home or a resting place, defended only by the poor, the illiterate, the despised, and the persecuted. We have seen how they have accumulated strength and energy, even in the darkest hour of their peril, till they awaken the interest and the regard of the opulent, the honorable, and the powerful. We have seen how the bonds of social union are originated, and how its spirit forms in its infant state. We have seen small communities of men planted, reared, and transformed into political bodies; and have also marked how the operative principles of republicanism have successively developed themselves. While at the same time, we have discovered by what a sin. gular and peculiar instrumentality, and influenced by what causes, the characteristic qualities of this portion of our country which are progressively imprinting themselves on the face of our whole union, have been originally acquired. Let it awaken the ardor and fire the energy of our devotion to institutions so wisely framed, and with so much care, so much toil, so much sacrifice, and so much blood, reared by our forefathers. Let it teach us to appreciate the noble heritage they have left us. Let it re. kindle our vigilance, and excite a jealousy of all, of any doctrines which tend, either in theory or in thought, to undermine the foundations they have laid.
ART. IV.-THE BANKING SYSTEM OF MASSACHUSETTS.
We are the advocates of a sound paper currency. We regard a paper circulation as one of the most efficient agents for the promotion of the pub. lic prosperity. We look upon the substitution of an intrinsically valueless promise-to-pay, for gold and silver, as a currency, as one of the greatest improvements of modern times; not only because of its economy, but 'be. cause of its effect, as the representative not only of property in the shape of gold and silver, but of every other species of property, in multiplying the means of increasing wealth, and diffusing it throughout the community. We look upon a sound paper currency as an evidence and a means of im. provement and progress. It is an instrument which civilization and refine. ment have invented, and one that will continue to be used by man as long as his progress is onward in the path of social well-being. But our object in the present article is not to enter into a defence of paper money. We have made the foregoing remarks to prevent the possibility of our being
misunderstood in some strictures which it is our intention to make upon the banking system of Massachusetts.
We are willing to avow, on the outset, that our object, in the present ar. ticle, is to expose an evil, but not to provide a remedy. The first step towards a cure must always be a clear understanding of the nature and seat of the disease. A project for a remedy may furnish a subject for another article. But it may be asked, what is then faulty in the banking system of Massachusetts ? The banks are all paying specie, and they have the confi. dence of the community to as great an extent as is desirable or proper. Surely a plan of which such are the results must be a good one. Let it be remembered, that when the ship leaves the port on a distant voyage, she goes prepared to encounter the ocean-storm, as well as to take advantage of the favoring breeze and the smooth sea. How recently have we seen the whole coast strewn with the wrecks of those wealth-producing and wealth. distributing interests, which, founded on credit and sustained by credit, under the direction of enterprise and skill, had been the means of so rapidly multiplying and extensively diffusing the wealth of the country! If there are in our present system defenceless points, that cannot resist the storms of adverse, or the corruptions of favoring influences, it becomes us to strengthen them, and not to flatter ourselves that the credit and integrity of our citizens will not again be submitted to a test of such overpowering severity.
It will be seen while we are exposing what we believe to be evils in the Massachusetts system, that they are most of them of such a character, as to render it probable that they are not confined to that state. We shall not trouble ourselves to point oui what are local and what general. If, in what we have to say respecting the banks of Massachusetts, there shall be found any thing applicable to the systems in operation in other parts of the coun. try, let those who are interested make the application.
What are the principal features of the Massachusetts system? What the obligations and what the privileges of the banking companies in that state? In order to ascertain these, let us take a bank of a certain amount of capital, say half a million of dollars, and find out the provisions of the laws by their application to a bank of that size. A bank with a capital of
$500,000 Can issue bills to the amount of
625,000 Can have due to it on discounted paper,
1,000,000 Can owe in bills and other obligations exclusive of deposits, 1,000,000 Must pay to the state treasurer annually,
5,000 If the issues of the bank are not redeemed on presentation, in gold or silver, the holder is entitled to receive interest on the amount at the rate of 24 per centum until they are discharged.
If the capital stock shall prove insufficient to redeem the bills issued, the stockholders are liable in an amount equal to their stock, for the deficiency. The state has the right at any time to demand, at thirty days' notice, a loan of $50,000, at an interest of five per cent; and if the requisition is not complied with, two per cent per month will be demanded during the time of the delay.
Such are the main features of the existing banking law of Massachusetts, applied to a bank with a capital of five hundred thousand dollars. We have omitted details, so that the most important provisions of the law may
the more plainly appear. We shall now proceed to lay before our readers some of the more obvious considerations which have arisen in our minds from an examination of the statements we have presented.
In the first place, we would call the attention of our readers to that part of the contract between the government and the stockholders, by virtue of which their notes, payable on demand, and signed by their officers, are made a part of the currency of the state, and go to add to the means of ex. tending their operations. In our opinion, this part of the banking system is radically defective; and we believe that it is mainly owing to the erroneous principles upon which our banking legislation has been founded as far as it relates to the currency, that so much evil has been found to result from the use of a paper circulation. We do not hesitate to declare our entire con. viction, that a system which allows a banking company with a capital of half a million of dollars to put out six hundred and twenty-five thousand dol. lars of bills to be used as currency, is an unsound system, and ought not to de sustained.
It is not safe to place in the hands of individuals, who, as managers or Danks, are naturally desirous of increasing their own business facilities, or the profits of their stockholders, the power of increasing to almost any extent they please the currency of the state. The currency, which is merely the measure or standard of value of the property of the people, ought not to be subjected to the changes which follow from the exercise of this power on the part of those to whom it is given by the laws of this commonwealth. It is not enough for wise legislation to see that penalties are provided for the non-performance of the obligations borne upon the face of the bank note. The mischief arising from a currency depreciated by its excess, can. not be repaired by the punishment of those by whose instrumentality the excess was produced. Under any circumstances, an issue by a bank, of bills amounting to once and a quarter its capital, would in our opinion be ex. cessive ; but if made, the laws of the land would sanction it, and it would not avail, in the face of the law by which it is permitted, to say that it was not supposed that the liberty would be used. When the law says that a bank may loan twice the amount of its capital, and may put out once and a quarter the amount of its capital in its own notes, it virtually declares it to be the opinion of the legislature that such an extension of loan and issue is both practicable and safe.
The amount of bills that should be put forth as currency, ought not, in our opinion, to be governed by the ability of interested individuals as agents of associations to give them out in exchange for obligations of another character. As long as notes bearing interest can be received for notes not bearing interest, with no return of the latter for exchange for that which is promised to be given for them on demand, so long, we are warranted by the experience of the past to say, will the operation be continued. And can that be a safe currency which is derived from such a source? Is money produced under such circumstances likely long to remain a proper standard of value and medium of exchange? Is it right that the property of every person in the state, should depend for its value upon the ability or inclination of the interested individuals whom the laws have made coiners of a cur. rency to issue out their promises to pay? We answer these questions in the negative We say that the banking institutions, as they are now con. stituted, are not the proper sources of a currency.
In this connection, we would look for a moment at the enormous tax