power "to coin money" (a) is given to Congress, and withheld from the States, in order to insure a uniform currency throughout the Union. This power involves that of "regulating its value." But in order to insure a sound, as well as uniform, currency, it was further necessary either to prohibit the circulation of "foreign coins" altogether, or else confer the further power of regulating their value. The former alternative would produce inconvenience, and the latter was adopted. The only danger would now arise from the "counterfeiting" of the coins thus provided for; and accordingly power is given to prevent this by punishment. Thus, so far as coins are concerned, effectual means are provided for securing to the whole country that greatest of commercial blessings, a sound and uniform currency. And in the exercise of this power, Congress has created mints, with the appropriate officers, for the purpose of coining. When bullion is brought to the mint, of the standard value, it is coined for the owner free of expense; but if below the standard value, he is required to pay the expense, which is called seigniorage. It will be remembered that Congress is not restricted to gold and silver; and therefore copper is used for such values as are too small to be conveniently measured by the other two. If to this we add the adoption of the decimal scale commonly called federal money, by which the dollar is made the unit of value, and all the other denominations are found by multiplying or dividing by ten, we have in theory a compiete money system. But the practical difficulty has hitherto been to adjust accurately the relative values of gold and silver. Up to 1824, they stood in the coins as fifteen to one. But at the same time, the market value of the two metals in bullion was nearly as fifteen and eight-tenths to one. The consequence was, that gold could not be kept in circulation, being at once bought up and uncoined. By the act of 1834, the eagle was reduced from two hundred and forty-seven and a half grains of fine gold to two hundred and thirty-two grains; which makes a difference in actual value of sixty-six and a half cents. Whether the true ratio is now attained, remains to be tested by experience. If not, one will be withdrawn from circulation as before.

The remaining provisions prohibit the States from "emitting bills of credit," and from "making anything but gold and silver coin a tender in payment of debts." (b) In order to understand these prohibitions, we must glance at the nature and history of what is called paper-money. Admitting that paper can in any way be made to supply the place of metallic money, or specie, the motives for making the substitution are three; First, specie has an intrinsic value, equal to its current value, or nearly so; while paper has comparatively no intrinsic value at all. Hence, by substituting

(a) On the subject of coins and mints, see note to 1 Stat. at Large, 216; 5 Stat. at Large, 136; act of Feb. 21, 1853; 7th section of the act of March 3, 1853.

(b) By the second section of the act of Feb. 21, 1853, it would seem that silver coins are legal tenders only for sums not exceeding five dollars.

paper for specie, there would be a saving to the whole country of the interest on the amount of the circulating medium, which may be set down at one hundred and fifty millions of dollars. Secondly, paper-money is much more portable than specie; that is, more easily transferred from place to place. Thirdly, a paper currency is more elastic than specie; that is, more readily susceptible of contraction or expansion, to meet the occasions of a trading community, liable to sudden fluctuations; because the material can be had at any time and in any quantity. The question then is, How can paper be made to pass for money? There are but two methods. In the first place, government may compel the people to take it as money. Despotic governments have often resorted to such high-handed expedients. And when this course is adopted, it makes but little difference whether the paper purports to be redeemable in specie or not; since its circulation is the result of compulsion. During our revolution, the State issued "bills of credit," known by the name of continental money, to an immense amount. These bills purported to be redeemable at some future time, by the States which issued them; but the general want of confidence soon made it necessary to bolster up their credit, by resolving, as Congress did, that whosoever should refuse to take these bills as money "should be treated as an enemy to his country." The despotic power was wanting, however, to sustain this resolve; and there was a constant depreciation in the value of these bills, until they finally ceased to be worth anything. It was to guard against the recurrence of such a state of things, that the States are now prohibited from emitting bills of credit." And lest this prohibition might be evaded, by substituting something else equally worthless, in the place of specie, a further one was added, and designed to cover the whole ground. The States are prohibited from "making any thing but gold and silver coin" a legal tender; that is, from compelling the people to take anything but specie as money. How, then, are we to account for the fact, that so small a part of our circulating medium consists of specie? To explain this, we must advert to the other method of making paper pass for money. This does not depend upon compulsion. There is no attempt to force a value upon that which has no value. Our paper currency consists of promises to pay specie on demand, which we call notes or bills. Their credit depends solely upon public confidence in the ability of the promisors to redeem them whenever called on so to do. No one is compelled to receive them as money; but while all believe they will at any moment command specie, they circulate as freely as specie. How, then, is this general confidence sustained? If those who issue these bills are required to keep in reserve an equal amount of specie, in order to redeem them, dollar for dollar, at the shortest notice, there is no profit in the operation. And if not, whence the confidence in their immediate redeemability? The answer is, that the whole paper scheme is founded on the presumption that the holders of these bills will not generally ask for specie

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at the same time; and therefore the amount of specie kept in reserve bears but a small proportion to the notes in circulation. And this is the great evil of the system. A general and simultaneous demand for specie cannot possibly be met, and disaster must follow. To enforce a universal performance of these promises, is to insure their being broken. Every sudden panic, therefore, must produce wide-spread calamity.

But let us inquire who make these promises or issue these bills. It cannot be the States directly, for they are expressly prohibited from issuing" bills of credit." If the United States possess the power, they have not exercised it, except in the case of treasury notes. And in most of the States, as in Ohio, private individuals are prohibited, from motives of public policy. Whence, then, does this paper issue? The answer is, from incorporated companies, under the name of banks. A charter enables a large number of persons to unite their means, and thus do conjointly and conveniently, what neither of them could do alone. The question then arises, can the States constitutionally incorporate banks with power to emit these bills of credit? Were this a new question, I should not hesitate to say that the States cannot do indirectly what they are prohibited from doing directly. They cannot confer a power which they do not possess. No one can read the provisions before quoted, in connection with the antecedent history, without being convinced that the federal constitution intended to prevent the States from supplying, in any way, the currency of the country. For we are thus exposed to precisely the same evils, as if these bills were issued directly by the States, and against which the prohibitions were designed to secure us. But as State banks have been in existence from a period prior to the formation of the federal constitution, it is now too late to question their constitutionality. (a) And the same may be said of the power of Congress to incorporate a national bank. (b) It has been too long acquiesced in to be called in question now. As an original question, however, it is much less doubtful than the other, as will be shown hereafter, when we come to speak of incidental powers. Still there are many persons who hold with much plausibility, that it was the intention of the framers of the federal constitution to exclude paper-money altogether, and confine the circulating medium to the metallic money coined and regulated by Congress. The provisions we have been discussing, certainly look that way. And though it may now be too late to return to such a state of things, yet a consideration

(a) See on this subject the cases of Craig v. Missouri, 4 Peters, 410, and Briscoe v. The Bank of Kentucky, 11 Peters, 257, where State banks, founded upon actual capital, and not upon State Credit, are held to be constitutional. The bills of a bank which has corporate property, are not bills of credit within the meaning of this clause, although the State creating the bank is the only stockholder, and pledges its faith to the ultimate redemption of the bills. Darrington v. The Bank of Alabama, 13 How. (b) See McCulloch v. Maryland, 4 Wheaton, 316; Osborn v. Bank U. S., 9 Wheaton, 738.

12.

of all the evils incident to our paper system, compared with its advantages, almost inclines one to wish it had never been introduced.

The principal functions of banks are the three following: First, they receive money on deposit for safe-keeping, with the privilege of using it until called for; which money is drawn out as the depositor wants it, by means of checks, or brief orders to pay the bearer. Secondly, they loan money at interest, by discounting the notes and bills of their customers; for which purpose they avail themselves of the average amount of the deposits, in addition to their actual capital. Thirdly, in performing these operations, they issue their own notes, instead of specie, whenever their customers will take them. From the combination of these three operations, they are called banks of deposit, discount, and circulation; and such are the curious and complicated engines which supply a large part of our circulating medium. Each bank, is under the management of a board of directors, elected by the stockholders, and sharing a divided responsibility. Their proceedings may be conducted in profound secrecy, since the public at large have no power of inspection. They are under a constant temptation to extend their issues beyond their means of redemption, because these reserved means, consisting of specie in their vaults, constitute their only unproductive capital. They rely, as we have seen, upon the general forbearance of their creditors, whether depositors or note-holders, to demand specie, except on special occasions; which demand, if made at the same time by all creditors upon all the banks, must inevitably produce universal bankruptcy; because the effect of the system is, not to keep specie enough in the country to redeem one dollar in ten of the paper. If, therefore, anything happens to disturb the general confidence upon which alone this forbearance depends, and create a panic, the consequence, even to prudent banks, is temporary embarrassment; and to imprudent banks, ultimate insolvency.

§ 57. Power as to Weights and Measures. (a) The words are, "to fix the standard of weights and measures. The design of conferring this power on Congress was, that weights and measures might be uniform throughout the United States. But, although the subject has been pressed upon the attention of Congress by elaborate reports, nothing has ever yet been done. And the common understanding is, that until Congress shall fix a general standard for the States, each State is at liberty to fix one for itself. (b) Anything like uniformity, therefore, must be the result of accident. In Ohio, an act was passed in 1811, to regulate measures; but there was nothing on the subject of weights until 1835, when an act was passed regulating both weights and measures.

(a) See 1 Black. Com. 226; 2 Story, Const. § 1122.

(b) Since the text was written, this State, by the act of 1846, adopted the standard furnished by the secretary of the United States treasury, pursuant to a resolution of Congress, adopted in 1836.

This act adopts the standard of New York. The great desideratum has been to find some standard which would never vary, and, if lost, could be replaced. Such a standard would be perfect; and vast sums have been expended by the governments of Europe in experiments to attain it. Perhaps, however, ours is as nearly perfect as need be desired. The standard of measure is a yard, as used in New York on the fourth of July, 1776; the length of which bears to the length of a pendulum vibrating seconds, at Columbia College in a vacuum, at the temperature of melting ice, the proportion of one million to one million eighty-six thousand one hundred and forty-one. If, therefore, perfectly accurate experiments could be made, the constancy of this standard would be equal to the constancy of gravitation; and, if lost, such experiments could replace it. The act then declares that "the standard thus defined, shall be measured in a straight line between two points, engraven upon golden disks, inverted into a straight brass rod ;" and this is to serve as an original standard of measure, from which all other denominations of length, surface, and solidity, are obtained by multiplication or division. The standard of weight is a pound, of such magnitude that the weight of a cubic foot of distilled water, at its maximum density, weighed in a vacuum with brass weights, shall be equal to sixty-two and a half such pounds. Thus the standard of weight is dependent upon that of measure. A standard pound is to be made of brass, according to this estimate, and to serve as an original standard of weight, from which all other denominations may be derived. The standard of capacity is a gallon, of which there are two kinds; one for liquid measure, the other for dry measure. The liquid gallon contains eight pounds of distilled water at its maximum density, at the mean pressure of the atmosphere, on the level of the sea; and the dry gallon ten pounds of the same. Thus the standard of capacity depends upon the standard of weight, as that does upon the standard of measure. An original standard gallon of each kind is to be made of brass, from which all other denominations are derived as before. There are divers other specifications for which I have not room. The act requires the secretary of state, who is made the State sealer of weights and measures, to procure original standards, as above defined, and keep them in a chest in his office. He is to furnish the auditor of each county, who is made the county sealer, with copies of these originals. And thus every citizen has a convenient means of procuring accurate weights and measures. To insure conformity, it is made penal to use any other weights and measures than those thus defined. (a)

(a) The use of weights and measures, of what is called the metric system, which is the French system, was legalized by Congress July 28, 1866. The Chicago Chamber of Commerce, and perhaps some others, attempted to adopt the system in their reports, but it was found inconvenient on account of its newness, and, I believe, has been dropped. The act gives tables for the conversion of one system into the other.