Page:A History of Banking in the United States.djvu/437

 In general, it may be said of all the banks in this next period, that they had developed to a new stage, as compared with anything in the previous history. They ceased almost entirely to be political. This was in part a consequence of their great number and of the smallness of each. They constituted, of course, a strong interest in each State whenever they were united; but in federal affairs they were not influential. They also ceased to be mysterious. In spite of their opposition, it may be said that they had, in this period, been brought to submit to the visitorial power of the State and to make public statements of their affairs. Their relative importance in the community also fell very much at the middle of the century. Other financial institutions were developed by the side of them, and great corporations were formed for other purposes, which grew so great as to overshadow the banks. In the earlier part of the century, they had been the only possessors of corporate power. In the older parts of the country also the accumulation of capital had now become so great that the old banking system of paper-money-mongering was out of date. Not that that system was given up by any means by the banks in the country towns. The banker's art consisted still, to a great extent, in getting a "good circulation" for his notes, and knowing when to put them out and when to take them in; but, at least in the largest centers, the accumulation of capital was such as to feed the deposits and give the banker an opportunity for a higher art of banking. In such places the circulation sank in importance. The check began to supersede the bank note, and the predominance of the currency over the affairs of men began to decline.

The effects of the financial catastrophe through which the country had passed in the previous period were seen in legislation for perhaps a decade, but then they were gradually forgotten. The literature of this subject for fifty years had repeated the same inferences, lessons, and warning; but all the doctrines of currency have to be learned over again apparently every ten or fifteen years, if indeed they are ever learned at all. From the landing of the first settlers at Massachusetts Bay until to-day, the country has never enjoyed ten years of peace, rest, and security, with an established and satisfactory system of currency. In 1852, there were no banks in Florida, Texas, Arkansas, Illinois, Wisconsin, Iowa, Minnesota, Oregon, California, and the District of Columbia. This was, however, no security. The States could not escape from a repetition of the woes they had endured by simply renouncing banks. Iowa was flooded with notes from New England. The Governor of Arkansas, in 1854, complained bitterly that that State was full of foreign notes and counterfeits, especially small notes, although it had no bank and was determined not to have any, and had legislated vigorously against small notes and change tickets. The coinage laws were such, until 1853, that fractional coins of the federal coinage could not be kept in circulation with bank notes redeemable in gold. There was, therefore, a constant