CHAPTER II.

First meeting of the 14th Congress-Message-Proceedings of Congress-Repeal of the internal duties-Debates on the Tariff-Sectional divisions on the subject of encouraging manufactures-Adjustment of claims resulting from the war-Claims of the Canadian volunteers-Of the crews of public armed ships for enemy's vessels captured and destroyed-Of persons connected with the army for losses of private property--Of the disbanded officers for a gratuitous allowance--Compensation law passed-National currency -Depreciated paper, its effects on the community-Origin and nature of banking institutions-Defects in the American system of banks-Proposition for a national bank-Constitutional objections-A bill for its establishment passed-Its provisions-Debates on the bill relating to the convention with Great Britain-Law passed for the admission of Indiana into the Union-Its provisions-Presidential election for 1817-Preparatory caucus -Proceedings and result of it-View of the origin and effects of the caucus system.

Meeting of congress. On the fourth of December, the period fixed by the constitution for the first meeting of the fourteenth congress, a quorum of both branches assembled, and the house of representatives organized themselves by the choice of Mr. Clay, speaker. On the 5th, the president sent his message, congratulating them on the successful termination of the Algerine war; a general pacification with the Indian tribes; and the general prosperity of the country on the return of peace.

Message. The measures recommended were, the proper arrangement of the finances, with a view to the receipts and expenditures of a permanent peace establishment :

The adjustment of the impost duties to the objects of revenue, and the encouragement of manufactures:

The establishment of a corps of invalids, with a view to make provision for the aged, infirm, and disabled officers of the late army:

The enlargement of the military academy at West Point, and the establishment of others in different sections of the union :

A classification, and a new organization of the militia : The preservation, and gradual increase of the navy : A provision for the disbanded officers of the late army : The establishment of a uniform national currency; And internal improvements by means of roads and canals. On the latter subject he remarks: "No objects within the

circle of political economy, so richly repay the expense bestowed upon them; there is none, the utility of which is more universally ascertained and acknowledged; none that do more honor to the government, where wise and enlarged patriotism duly appreciates them. Nor is there any country which presents a field, where nature invites the art of man to complete her work for his accommodation and benefit. These considerations are strengthened by the political effect of these facilities for intercommunication in bringing and binding more closely together the various parts of our extended confederacy. While the states, individually, with a laudable enterprise and emulation, avail themselves of their local advantages by new roads, by navigable canals, and by improving the streams susceptible of navigation, the general government is the more urged to similar undertakings, requiring a national jurisdiction by the prospect of thus systematically completing so estimable a work. And it is a happy reflection that any defect of constitutional authority which may be encountered, may be supplied in a mode which the constitution itself has providently pointed out."

Arrangement of the finances. There have been few meetings of congress since the organization of the government, at which a greater variety of interesting subjects pressed themselves upon the consideration of the national representatives. Among the first, was the arrangement of the system of finance to a state of peace. The leading principle has ever been to raise the ordinary revenue from impost and tonnage duties, and sale of the vacant lands; and to resort to internal duties and direct taxes only upon extraordinary occasions, and for limited periods. The difficulties experienced at the commencement of the late war in arranging and bringing into speedy operation a system of internal revenue, and the consequent embarrassments of the treasury, induced the secretary to recommend a continuance of the least exceptionable part of that system. His views were supported by many enlightened financiers in both houses; but a majority decided in favor of the total abolition of the system of internal taxation, with the least possible delay.

The

Tariff. The adjustment of the tariff produced many and long debates, principally of a sectional character. double duties imposed during the war, were to be taken off, and a system adopted adequate to raise a competent revenue; and at the same time, give proper encouragement to domestic industry. Almost every item of impost had its ad

vocates and opposers, as it affected the interests of different portions of the union. The sections, into which the country divided itself on these questions, were the east, the south, and the west.

Views of the south. The large planters of the south formed the predominant interest in that section; they, having valuable staples for exportation which commanded a ready market, and no important home manufactures, were uniformly opposed to high duties, laid with a view to the protection of American manufactures. The principles they advocated, were, that imposts should be laid solely with a view to revenue; that industry, enterprise, and capital," should be left to seek employment in those channels which afforded the fairest prospect of reward; that prohibitory and protecting duties operated in an unjust and oppressive manner in favor of the manufacturer, against the consumer, and were contrary to the spirit of the constitution. That the American manufactures were yet in an infant state, and incapable of supplying the wants of the people; that destroying the competition between foreign and domestic productions, subjected the consumer to purchase goods of an inferior quality, and at extravagant prices. The governments of Europe, having a dense population, and numerous subjects who find it difficult to procure subsistence and employment, might well adopt the policy, as they uniformly had done, of excluding from their markets, every foreign article which could be raised or manufactured at home. This policy carried to its utmost extent in Great Britain, it was admitted, had made on a small island, a great, rich, and powerful nation. The situation of the United States, the representatives from the south contended, indicated a different policy: possessed of a rich unappropriated territory of almost unlimited extent, the first object of government should be to people that region; and instead of confining their citizens to the workshops and manufactories of the east, they should encourage their emigration and settlement on the vacant territory of the west; or, at least, that they should leave them to employ their industry and capital on either object, uninfluenced by the financial operations of government. The eastern section was divided into agricultural, commercial, and manufacturing classes; the commercial portion of this section, apprehending their interests on this question to be the same with the planters of the south, united with them in opposing, though for different reasons, heavy prohibitory or protecting duties.