"The incompetency of special legislation, when applied to the adjustment and regulation of the paper currency of the country, I presume few sensible men, at all acquainted with the subject, will question; nor is it possible for any man of business, or any possessor of property, in whatever shape, to feel safe while the power to inflate or contract the currency is arrogated by any one man, whether he happens to be some narrow-minded, bigoted, obstinate official, acting on his own volition, or some subordinate clerk, acted upon by others.
"No one should be entrusted or tempted with such a power; for no man, however able and honest, could by any possibility justly or accurately exercise it. Foolish as was the experiment, however, we have tried it: and with the ill success that was inevitable.
"The sway to and fro of our currency, controlled by the ebb and flow of our business transactions, consequent upon seed time and harvest, is subject to law as imperious and immutable as any that governs either the physical or moral world; and in just the degree that we understand and conform to its action can we hope for a successful solution of the problem that now so vexes the minds and disturbs the interests of all classes of the community.
"The nearest approximation we have yet made to such an understanding and conformity has been in the New York free banking law, from which the national currency act has borrowed all of any merit it possesses.
"This New York law, free from the vice of monopoly which the national currency act inherits from the necessities of its birth, and open to all men, as any honorable pursuit should be in this republic of ours, is also distinguished by three salient points: perfect security to bill-holders, freedom from arbitrary reserves, and systematic redemption of bills. In this last feature of the law, disagreeable as it is at times to speculation or unwary bankers, lies the key to its success, checking and governing as it does by its conservative action all over-issues, while still leaving the open freedom of the system untouched by any useless restriction; so that, no matter how great the number of those who choose to embark in the business, no more currency can be kept afloat than the wants of the country demand. The national currency act fails because it is a monopoly; because it has only a nominal redemption; and because of its arbitrary reserve clause, which serves only to hamper the means and obstruct the usefulness of our metropolitan banks at the very time when the trade of the country most requires their services, to say nothing of the power for evil which a knowledge of this fixed limit gives to the gamblers and speculators who hang around and within our stock-exchanges; and, lastly, because it has no power of expansion and contraction in response to the varying calls of trade and commerce.