Deplorable, however, as may be our present financial condition, we may yet indulge in bright hopes for the future.  No other nation has ever existed which could have endured such violent expansions and contractions of paper credits without lasting injury; yet the buoyancy of youth, the energies of our population, and the spirit which never quails before difficulties will enable us soon to recover from our present financial embarrassments, and may even occasion us speedily to forget the lesson which they have taught.  In the meantime it is the duty of the Government, by all proper means within its power, to aid in alleviating the sufferings of the people occasioned by the suspension of the banks and to provide against a recurrence of the same calamity.  Unfortunately, in either aspect of the case it can do but little.  Thanks to the independent treasury, the Government has not suspended payment, as it was compelled to do by the failure of the banks in 1837.  It will continue to discharge its liabilities to the people in gold and silver.  Its disbursements in coin will pass into circulation and materially assist in restoring a sound currency.  From its high credit, should we be compelled to make a temporary loan, it can be effected on advantageous terms.  This, however, shall if possible be avoided, but if not, then the amount shall be limited to the lowest practicable sum.

I have therefore determined that whilst no useful Government works already in progress shall be suspended, new works not already commenced will be postponed if this can be done without injury to the country.  Those necessary for its defense shall proceed as though there had been no crisis in our monetary affairs.

But the Federal Government can not do much to provide against a recurrence of existing evils.  Even if insurmountable constitutional objections did not exist against the creation of a national bank, this would furnish no adequate preventive security.  The history of the last Bank of the United States abundantly proves the truth of this assertion.  Such a bank could not, if it would, regulate the issues and credits of 1,400 State banks in such a manner as to prevent the ruinous expansions and contractions in our currency which afflicted the country throughout the existence of the late bank, or secure us against future suspensions.  In 1825 an effort was made by the Bank of England to curtail the issues of the country banks under the most favorable circumstances.  The paper currency had been expanded to a ruinous extent, and the bank put forth all its power to contract it in order to reduce prices and restore the equilibrium of the foreign exchanges.  It accordingly commenced a system of curtailment of its loans and issues, in the vain hope that the joint stock and private banks of the Kingdom would be compelled to follow its example.  It found, however, that as it contracted they expanded, and at the end of the process, to employ the language of a very high official authority, “whatever reduction of the paper circulation was effected by the Bank of England (in 1825) was more than made up by the issues of the country banks.”