John Sherman

The power granted to the Bank of France and the Bank of England to issue circulating notes was greatly abused during the period of war.

Whenever specie payment was suspended, the power to issue a bank note was the same as the power to coin money.

I said that during war local banks were the natural enemies of a national currency.

The issue of United States notes by the government, and the making them a legal tender, was made the basis of an inflated bank circulation in the country, and there was no way to check this except by uniting the interest of the government…

While the government had been issuing its paper money some of the banks were inflating the currency, by issuing paper money on the basis of United States money.

They furnished the best substitute for gold and silver that could then be devised, and if we could limit United States notes to the amount then authorized by law they would form a suitable and valuable currency.

We were compelled, by a necessity as urgent as could be imposed upon any legislature, to issue these notes.

We were then in the peculiar condition of a nation involved in a war without any currency whatever which by law could be used in the ordinary transactions of public business.

We therefore must look for some system of finance that would give us all the aid possible, either in the form of paper money or by the agencies of associated banks.

The measure affected the property of every citizen of the United States, and yet our action for good or evil must be concluded within a few days or weeks of that session.

It was the misfortune of war that we were compelled to act upon matters of grave importance without that mature deliberation that would be secured in peaceful times.

The moment is pregnant with futurity, and if not seized at once by Congress, I know not on what shoal our bark is next to be stranded.

Providence seems, indeed, by a special dispensation, to have put down for us, without a struggle, that very paper enemy which the interest of our citizens long since required ourselves to put down, at whatever risk.

We are now without any medium, and necessity, as well as patriotism and confidence, will make us all eager to receive treasury notes, if founded on specific taxes.

Such a currency would lead to the conversion of the notes into bonds, and by this process the people would absorb the national loan and enable him to carry on the government without any sacrifice to them.

I insisted that if there was no money in this country but United States notes, the process of funding would be going on day by day.

I confess, Mr. president, that the more I reflect on this subject, the more clearly does my mind approach the conclusion that the creation of state banks, for the purpose and with the power of circulating paper, is not consistent with the…

Is not this a clear indication of the intent of the constitution to restrain the states, as well from establishing a paper circulation as from interfering with the metallic circulation?

Ordinary tyranny, oppression, excessive taxation, these bear lightly on the happiness of the mass of the community, compared with a fraudulent currency, and the robberies committed by depreciated paper.

This is the most effectual of inventions to fertilize the rich man's field by the sweat of the poor man's brow.

Of all the contrivances for cheating the laboring classes of mankind, none has been more effectual than that which deludes them with paper money.

It wars against industry, frugality, and economy; and it fosters the evil spirits of extravagance and speculation.

It undermines the virtues necessary for the support of the social system, and encourages propensities destructive of its happiness.

A disordered currency is one of the greatest of political evils.

With a national currency, uniform and equal throughout the country, this cost for exchange would not exist or would be greatly reduced.