GOVERNOR'S MESSAGE.
2ro the Elonorable the Senators and Members
of the House of Representatives of the
Commonwealth of Pennsylvania :
GENTLEMEN: Although'the year just closed
has been one of great depression in the busi
ness and monetary affairs of the country, I
am happy to be able to announce 'to the Rep
resentatives of the People, that the finances
of Pennsylvania are in a most satisfactory
condition.
The receipts at the Treasury, from all
sources, for the fiscal year, ending on the 30th
day of November, 1858, were $4,139.778 35;
and the expenditures, for all purposes, during
the same time, were $3,775,857 06. Leaving
an excess of receipts over expenditures of
$3U3,921. 29.
This exhibit shows that there was actually
in the Treasury on the first day of December,
1858 ; the sum of $363,921 29, more than
there was on the first day of December, 1857.
In addition to this, among the expenditures
for the year, wore
Llans redeemed,
Relief Notes, redeemed,
Interest Certificates, redeemed,
'Making of the public debt funded and unfaud•
ed paid during the year the sum of
If we add to this the excess of money on hand
at the end of the fiscal year, over what re-
mined in thu Treasury, at tho same thno
last year, via:
NVo Lace th 3 SUCH of
But this is not all. The amount paid on
the public improvements, including damages
and old claims, during the fiscal year,
was $3-11,030 58
Wile the amount of reroute, from the same
source, for the same period, wa3 only
Making an execis of expenditureg over receipti
Nvhiell happily we will be relieved from in
the future, of
This sum should, als6, be credited to the
operations of the Treasury, during the year,
for it was an extraordinary expenditure,
-which cannot again occur ; and was, in fact,
a reduction of the liabilities of the Common
wealth, to that extent.
If we aJd this sum to the amount of debt
paid, and the excess of cash on hand, we
have for the year, a balance in favor of the
receipts, over the ordinary expenditures,
amounting in the aggregate to $1,031,382 36.
But from this, however, should be deduc
ted the extraordinary receipts, which were,
Ist. The amount paid by the Pennsylvania
iuitroad Cunipany. on the principal of the
debt duo by the said company, to the C
intlDOn-
Weelth. for the purchase of tho Main Line,
2d. The amount received from the Jirerd
Bank, for loans of the Commonwealth sold by
that bank,
In all
Which, deducted from the foregoing ag
gregate of $1,031,382 36, leaves the true bal
ance of the ordinary receipts over the ordi
nary es.penditures for the fiscal year at *::;903,-
382 36.
The funded and unfunded debt of the Com
monwealth, on the Ist day of December,
1857, was as follows:
FUNDED DEBT
6 per cent. loan,
5 per cent. loan,
4i per cent. loan,
4 per cent loan,
To this should be added 5 per cent. Cou
pon Bonds sold by Uirard Bank, nut
before rvported,
Total funded debt,
I:NFIJNDF.D DEBT
Relief Notes outstanding,
Interest certificates,
Do. do. unclaimed,
Domestic creditors,
Total unfunded debt,
Making the entire debt of the Common
wealth at the period named •: 4 39 9:19,738
. The funded and unfunded debt of the State
at the cheze of the last fiscal year, D.2cember
Ist, 185 S stood as follows:
Ti LADED DEIST
6 per cent. loans,
5 per cent. loans,
44 per cent. loans,
4 per cent. leans,
Total funded debt,
UNFUNDED uE.r.ir
Relief Notes outstanding,
Interest Certificates,
Do. do. unclaimed,
Thuiestie Creditors,
Total unfunded debt,
Making the public debt on the first of De
cember last, $39,488,243 07. Since the close
of the fiscal year, the Commissioners of the
Sinking Fund have redeemed of the five-per
cent. loan, the sum of $220,132 51, leaving
the real debt of the Commonwealth, at this
time, funded and unfunded, $39,268,111 16.
To meet this, besides the ordinary sources
of public revenue, the State owns bonds re
ceived from the sale of the public works, and
which I have every reason to believe, are
well secured, amounting to eleven millions
one hundred and eighty-one dollars. Deduct
ing this from the outstanding debt, it leaves
to be otherwise provided for, the sum of
twenty-eight millions eighty-seven thousand
one hundred and eleven dollars and sixteen
cents.
It is believed that, with the existing sour
ces of revenue, and the observance of strict
.economy, this sum may be reduced, during
the current year, at least one million of dol
lars.
The present would seem to be the appro
priate time—when our nation is at-peace—
and when health and reasonable prosperity
prevail within our own borders—to greatly
reduce the public debt. We have but to
carefully husband our legitimate resources,
avoiding extravagant and unnecessary appro
priations, and practicing a proper economy
in all the departments of Ciorernment, to ren
der the entire extinguishment of our debt a
fixed fact within a very brief period. To
carefully guard the public treasury at this
interesting epoch in our financial history, is
so manifestly. the duty of the public authori
ties, that I cannot for one moment believe
that any other policy
.will be proposed. If
there be any, who, relying on the improved
condition of the finances of the State, would
encourage the adoption of new schemes for
depleting the Treasury, or would cut off the
sources of our present revenue, and thus re
duce it, let all such efforts, coming from what
ever quarter they may, be sternly resisted.
Let Pennsylvania be just before she is gener
ous. Let our good example be a light in the
pathway of .our sister States, as well as an
admonition to our own local governments.—
This is due alike to the favors which Provi
dence has so bountifully bestowed upon us,
: and to that high character for honesty and
'integrity which has. ever distinguished the
people of this good old Commonwealth.
In pursuance - of the act entitled "An Act
for the Sale of the State Canals," • approved
on the 21st day of April last, I did, as the
Governor of the Commonwealth, on the 19th
• day of May 1868, convey to the Sunbury and
.7rie Railroad -Company. a.ll.the public works
belonging to the Commonwealth, then re
maining unsold, consisting of the Delaware
Division—the Upper and Lower North Branch
Divisions—the, West Branch Division—and
the Susquehanna Division of the Pensylvania
Canal, with all the property thereunto be
longing, or in anywise appertaining, and all
the estate, right, title and interest of this
Commonwealth therein, for the sum of three
millions five hundred thousand dollars. To
secure the payment of this sum, the Sunbury
and Erie Railroad Company paid to the
S 4 ate Treasurer its bonds, secured by a mort
gage, as directed by the act, for the amount
of the purchase money. The Company, also
complied with the provisions of the Act
which required it, as additional security, to
execute and deliver to the State Treasurer a
mortgage on the Delaware Division fur one
million—a mortgage on the Susquehanna and
West branch Divisions for a half million—
and a mortgage on the Upper and Lower
North Branch Divisions for a half million dol
lars. The deeds and mortgages were all ex
ecuted under the immediate supervision of
the Attorney General, and were in strict
conformity with the requirements of the
$350,306 85
41,071 00
116 70
421,404 55
3C3.921 20
$785,415 84
05,070 06
$24.5,9GG 52
After the conveyances were duly executed
and delivered, possession of the canals was
given to the railroad company.
The act further provided that the Sunbury
and Erie Railroad Company should not re
sell the Canals, or any part of them, without
the consent of the Governor ; and that if a
re-sale were made for a greater sum, in the
aggregate, than three and a half millions
dollars, seventy five per centum of the excess
should be paid to the Commonwealth, in the
bonds of the purchasers. It was also pro
vided that upon a re-sale, the mortgages giv
en by the Sunbury and Erie Railroad Com
pany to the Commonwealth, upon the Canals,
"should be cancelled by the State Treasurer
and surrendered to the company by the
Governor, on deposite made by the said com
pany in the office of the State Treasurer, of
an equal amount of the bonds of their gran
tees, secured by mortgage of the canal or
canals sold as aforesaid"---with a provision
that no transfer of securities should be made
until the Governor should he satisfied that
the new securities to be given were sufficient
to protect the interests of the State; and that
his written approval of the change should be
filed in the office of the Secretary of the Com
monwealth.
$103,000
ESE
$128,000
4145,150 00
38,773,22 s' )
35,200 00
100,000 00
23,000 00
V:4 ; 73.1,592 5:2
Sales were made by the Sunbury and Erie
R tilroad Company and reported to me under
the oath of the President, of the different
lines, as follows:
146.421 Of)
°3,173 So
4,418 3$
(.) 9 T,O
The Upper am' Lower North Branch Ca
nal, to the North Branch Canal Company,
for 51,600,000
The West: Branch and Susquehanna Divis
ions. to West Branch and Snsquehanuct Ca
nal Company, for 500,000
. . . .
$175,145 70
The. Delan are Division. to the Delaware
Divbimi Canal Company, of Pennsylvania,
fur 1,775,000
n tllO tom of $3,575,000
Upon investigation and inquiry, having
become satisfied that these sales were made
'.or fair prices, and upon such terms, and
to such persons composing the various pur
chasing associations, as to insure the pay
ment of the purchase money, they were sev
erally approved.
After the contract for the sale of the Del
aware Division had been entered into and my
consent had been verbally given, and seven
ty five thousand dollars of the purchase mon
ey had been actually paid by the purchas
ers, upon the faith of the contract, and my
assent thereto, I was informed that a higher
price had been offered, by responsible per
sons, for the canal. But under the circum
stance?, my opinion was that the offer came
too late; and as the Railroad Company con
sidered itself bound to eonsumma:e the agree
ment by a delivery of the deed and possesion
of the property to the first purchasers, I
could not, in good faith, withhold my assent.
The North Branch Canal Company, subse
quent to the purchase of that division, sold
that portion of the canal lying between
Wilkesbarre and Northumberland to The 'Wy
oming Canal Company for the sum of nine
hundred and eighty-five thousand dollars.
On the 13th of September, 1858, bonds of
the various companies owning the different ca
nals, secured by mortgages, were, in pursu
ance of the act, and by my approval, deposi
ted with the State Treasurer to the amount
of two millions of dollars ; and the mort
gages on the canals given by the Sunbury
and,Erie Railroad Company, were cancelled
by the State Treasurer, and surrendered by
me to the company. in accordance with the
directions of the law. At the same time a
settlement was made between the Common
wealth and the Railroad Company, by which
the latter paid to the State seventy-five per
centuin of the proceeds of the re-sale over
and'above'the contract price of three and a
half millions. This amounted to two hun
dred and eighty-one thousand two hundred
and fifty dollars, and was paid in the follow
ing manner, viz :
4 445,180 00
38,42.0,D05 67
3z-%200 00
i:)0,000 00
~$:39,354,265 07
$10k":,350 00
23.357 12
4,44 S 3S
802 50
St 33,058 00
Bonds of the Wyoming Canal Company. se
sured by mortgage on the Canal from Wilkes
barre to Northumberland, payable, in twenty
years with interest at six per emit, payable
semi-annually, $2.51.000
Cash, 2.50
These bonds areNrell secured, and the ac
cruing interest and principal, when due, will
doubtless be promptly paid.
From information of a reliable character
recently communicated to me by the Prost
dent of the Sunbury and Erie Railroad Com
pany, it appears that the prospects of an
early completion of that great public high
way are very encouraging. A large amount
of work has been done on the line of the
road during the past season, and at this
time, very considerable portions of the road
are graded and rapidly approaching comple
tion. It Is the opinion of . the President of
the company, that, within two years, the
work will be entirely finished, so that cars
will be running directly from the city of Phil
adelphia to the harbor of Erie.
When this great enterprize shall he con
summated, and the desire of its friends final
ly accomplished, the payment of the three
millions and a half of mortgage bonds, whiPb
WILLIAM LEWIS,
VOL. XIV.
Total,
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the State has received in exchange for the
canals, will unquestionably be well secured
—whilst the railroad,itself, will prove of incalcu
lable advantage to our great commercial empo
rium, as well as to the important, but long neg
lected, region through which it passes. Its
construction will undoubtedly add to the value
of the real estate of the Commonwealth many
times its cost, and develope and bring into
use the rich resources of the country which
have hitherto remained as they were lavishly
strown by the hand of nature. I have an
abiding confidence that the result will abun
dantly prove the wisdom of the measure,
which, while it guaranteed the completion of
one _of the greatest improvements ever pro
jected in the Commonwealth, it, at the same
time, divorced the State from the unprofita
ble and demoralizing management of her
railroads and canals.
Whatever difference of opinion may at any
time, have been entertained in regard to the
propriety of the details of the legislation au
thorizing the sale of the main line, or the
branches, it can scarcely be doubted the pub
lic welfare will, in every respect, be vastly
promoted by the transfer of the managemen;,
of the public works from the State to indi
vidual owners.
The short experience that we have had al
ready, proves conclusively that the Common
wealth is greatly the gainer, in a financial
point of view, and it has been equally demon
strated that the people at large have been as
well, if not better, accommodated, by the
change.
It would, in my judgement, be a public
calamity, if, by the happening of any con
tingency, the Commonwealth should be con
strained to again become the owner, and re
sume the management, of any portion of the
improvements.
The power of the General Assembly to
pass the Act of the 21st of April, 1858, rel
ative to the sale of the State canals was ques
tioned before the Supreme Court of the State,
since the transfer of the Canals ; and, after
full argument, the Constitutionality of the
Act was sustained by the unanimous judge
ment of the Court.
Since the sale of the public works, and the
settlement of the principal outstanding claims
against the State, it is obvious that there is
no further necessity for a Board of Canal
Commissioners, or a Canal Department. I,
therefore, recommend the abolition of the
Board, and that provision be made for the
transfer of the records to the office of the Au
ditor General.
In view of the foregoing exhibit of our re
sources and financial condition it is apparent
that a most interesting era has been reached
in the history of the Commonwealth. Re
lieved from the entangling embarrassments of
an extensive system of internal improvements,
the means of the State are now ample fur all
legitimate purposes, and her public debt is
gradually but certainly disappearing. From
these and other causes, governmental action
has become greatly simplified, and the na
ture of the subjects of its operation has chang
ed in a degree no less remarkable.
The almost entire disposal of the lands
which belonged to the State, has already dis
pensed with one of the Departments created
for their care, and will, ultimately, render the
other unnecessary, except for preserving the
evidences of their transfer.
The sale of the public works has relieved
the Executive branch of the Government of
many of its most responsible and perplexing
duties, and in effect, dispensed with one of
its most formidable and difficult departments.
In the same proportion, the action of the
Legislature will, if the representatives of the
people be true to the interests reposed, and
sternly refuse to entangle the public with
those numerous projects and enterprises
which are continually seeking its alliance,
be simplified and economized, purified and
strengthened.
And it is as remarkable as it is propitious,
that an era which has thus relieved the
State authorities of burthens that consisted,
either of mere material interests, or the care
of local ad mini str at lon,—conmal tting the one
to the local sovereignty of the people, and the
other to private or associated enterprize,—
should also present for consideration and pro
motion intellectual and moral claims of pecu
liar importance.
It is at this period in our history that, the
system of public education challenges the at
tention of the most unobservant. And I
shall be much mistaken in the cautious• but
steadfast character of the people of Pennsyl
vania, if their Representatives do not make
it the first object of their solicitude.
The annual report of the Superintendent
of Common Schools, will lay before you the
present condition of the Common School Sys
tem, and of its operations during the past
year. Your close and scrutinizing attention
is invited to the details of that document.
Including the city of Philadelphia, it will
be observed, that there were in the public
schools of the State, during the year which
terminated on the first Monday of last June,
628,201 pupils; these were instructed during
an average term of a little over five months,
in 11,281 schools, by 13,856 teachers, at a
total cost of $2,427,632 41.
Here is a public interest, which,--whether
we regard its ramifications into every portion
of our social fabric, its large cost, the impor
tant powers over the present which it wields,
or its incalculable influence upon the future,
undoubtedly transcends all others committed
to care of the secular authorities. This being
the case, I have no hesitation in asserting
that the time has arrived when its full im
portance should be recognized, and that its
due administration should be made the duty
of a fully organized and effective, as well as
a separate department in the government.
But the mere care and promotion of our
system of Common Schools—important and
extensive as it obviously is,—should 'not be
the sole object of such a Department, If it
is true that the power to punish crime includes
also the right to prevent it, by providing for
the proper intellectual and moral training of
the people, it would seem to follow that the
department charged with the latter momen
tous duty, should also be in possesion of all
tiources ann subjects of information, cal
$251.250
-PERSE VERR.-
HUNTINGDON, PA., JANUARY 12, 1859,
V
*
f -i... 4 '
- Nii,.•
culated to shed light upon the object of its
action. Hence the collection, arrangement,
and practical deductions from population and
industrial statistics ; from natural defects,
and such as deafness and dumbness, blind
nags and lunacy ; from crime in its various
forms and developements ; together with such
control over all the literary and scientific in
stitutions in the State, as shall bring their
full condition into view—should also belong
to the same Department.
Therefore, I most respectfully, but earnest
ly, urge upon your favorable consideration,
at the present propitious moment, the organ
ization of such a Department, in the room of
those for the care of mere matter whose
agency has been or soon will be discontinued
by the onward and upward progress of the
Commonwealth.
A suitable Deportment of Public Instruc
tion, will not, however, of itself, effect all
that is needed in this direction. The gener
al results of the Common School system, al
ready cited, show the importance of its na
ture, and the magnitude of its operations.—
If we look, also, into its special statistics, the
conclusion will be equally clear that certain
improvements in its working machinery, are
equally indispensable.
It is needless to attempt to prove the truism
that the properly qualified teacher is the life
and success of the school. But the facts are
startling, that of the 12,828 teachers of our
public schools, exclusive of those in Phila
delphia, only 5,087 are reported as "quali
fied" for their important trust; while 5,387
are returned as "medium," or such as are
only tolerated till better can be obtained; and
that 2,313 are stated to be "unfit." In other
words: of the 569,880 children attending
the schools out of Philadelphia, only about
230,000 (less than one half) are under proper
instruction and training; while about 240,-
000 are receiving insufficient instruction from
inferior teachers; 100,000 arc actually in
charge of persons wholly unfit for the task.
This presents the subject in a light that
can not. be shut out; and, though the great
and commendable efforts recently made by
the teachers of Pennsylvania, for their own
improvement, are fully recognized, it can not
he concealed that there is a work yet to be
d6ne, in this relation, which would seem to
be beyond their unaided power to accomplish.
- When, however, we look further into the
special statistics of this branch of the system,
the material for improvement is found to be
or the most promising kind. Of the 12,828
.
tcamers of our common schools, 10,889 are
under thirty years of age, and 10,9-16 are
natives of Pennsylvania ; and a larger pro
portion than in Most of the other States, are
permanently devoted to the profession of
teaching. To render these fit for the position
to which they aspire—undoubtedly one of
the most useful and honorable in the world—
and to raise up a constant supply of well
qualified successors, is the work to be done.
Various modes of effecting this object have
been suggested or tried ; but, after mature re
flection, I am led to prefer that devised by
the Act of May 20, 1858, entitled " An Act
to provide for the due training of teachers
for the Common Schools of the State." It
places, in relation to the State, the teacher
on the same footing with the members of such
of the other learned professions as have been
recognized by public authority ; and it is to
be regretted that the prostration of business
and scarcity of money, that so soon followed
the passage of the net, had the effect of
checking many laudable efforts to put its pro
visions into operation. Under these circum
stances, does it not become the duty of the
State to afford such aid, or at least hold Out
such inducements as shall enable this measure
to be fairly tested ?
The passage of a law goaranteeint , the
payment of a moderate sum to one Teachers'
School in each of the districts created by the
act of 1857, would no doubt cause a sufficient
number to establish the efficiency and prac
ticability of the plan, to be completed in a
few years ; the money not to be paid till the
schools were in full and approved operation.
It is not probable that this grant would cause
any considerable draft on the treasury ; but,
even if the whole twelve schools should ulti
mately be established, the boon would neith
er be out of proportion to that which has
been conceded to other literary inz..:,utions,
nor the number of grathzatcs beyond. zi e.
wants of the community. Up thts p.ivz:ent
time, Pennsylvania has a pp roivt•iat cd aiout
$300,000 in aid of her colleges and academies,
and this mainly in the hope of obtaining from
them teachers for the common schools.—
Though the benefits of this munificence have
been, in other respects, quite equal to the
amount given, it will be asserted by no one
that the avowed object has been to any con
siderable extent effected. It would therefore
appear to be time that the aid of the State
should be brought directly to bear in favor
of the great object so long contemplated.
I have thus briefly laid before you the con
dition of our noble educational system. It
will afford me sincere pleasure to concur in
the adoption of these, or any other measures,
for its perfection, that the wisdom of the leg- •
islature may devise.
In this country, the want of a school which
shall combine the elements of learning and
agricultural labor, and thus adapt itself to
the education of the farmer, has been most
seriously felt ; for, whilst our many colleges
well fill the measure of usefulness in their
appropriate sphere of influence, it must be
conceeded that the training they impart is
badly adapted to the art of practical agricul
ture. In Pennsylvania that interest is so im
portant as to demand at all times our anxious
attention, and active support. " The far
mer's High School of l'ennsylvanja, ,, l a t e ly
projected and planned by a few p u bli c s pi n i.
ted individual.;, and which has received, to
Some extera, the patronage of a number of
our patriotic citizens, is destined to laird a
place where young men may be educated at
an expense commensurate with their means,
and to a condition qualifying them for the
pursuit of the business of the farm. Here,
whilst daily occupation will train the body to
the ability to labor, and give to the student
the enviable feeling that he contributes to his
own support and education, it will instruct
•
and enlarge his mind, that it may give force
and effect to all his future efforts. The de
sign of the institution is to afford a school
where boys may be thoroughly educated in
all the branches of natural science, and, at
the same time, be inured to the performance
of labor; so that at their graduation they
may return to their parents abundantly pre
pared to join the domestic circle, to give a
right direction to the business of agriculture,
and act well their part in every department
of life, An object so fraught with useful
ness is entitled to the highest commenda
tion.
The application of scientific principles to
the practical purposes of life, is but realiz
ing the full benefit of those laws of nature,
to discover and to profit by, which, is un
doubtedly one of the great ends of human
reason. The more this important object is
held in view and affected by our higher in
stitutions of learning, the more valuable and
useful will they become. The Polytechnic
College of Pennsylvania at Philadelphia, is
founded on this basis ; and its attempt to
popularize science, and connect high acquire
ment with practical ability, is presented to
your favorable consideration.
Under a resolution of the last House of
Representatives a committee was apyointed
by the Speaker of the House, to examine the
state and condition of several Banks charter
ed at the session of 1837. The resolution
directed the committee to report to the Gov
ernor the result of its examination within nine
ty days after the adjournment of the legisla
ture. On the 20th of July last, the report of
committee : together with the accompanying
evidence, was filed in the Office of the Secre
tary of the Commonwealth, a copy of which
will be laid before the House of Representa
tives.
In view of the facts reported by the com
mittee, in reference to the organization and
subsequent management of the Tioga Coun
ty Bank, the Crawford County Bank, and
the Bank of Shamokin, I would recommend
a careful inquiry into the present condition
of these institutions, and if it shall be ascer
tained that the public is likely to suffer inju
ry from the further existence of either, a
speedy and certain remedy may be found in
a legislative repeal of the rights and privileges
granted by the acts of incorporation. The
power to alter, revoke, or annul, the charter
of a bank whenever its continuance may, in
the opinion of the legislature, be injurious to
the citizens of the Commonwealth, is express
ly given by the Constitution to the General
Assembly,—to be exercised, however, in such
manner as that no injustice shall be done to
the corporators.
Obedience to this constitutional injunction
would require that in the event of a repeal of
a charter of a hank, care should be taken that
the rights of the stockholders to the surplus
assets of the bank, after payment of its debts,
were protected ; and that suitable provisions
should,bc made for settling its affairs.
The injunction contained in the Constitu
tion, that the repeal or revocation of a bank
charter shall be in such manner as to work
no injustice to the corporators, is not a qual
ification of the power to revoke, or annul, the
charter, but it is simply a requirement that,
in taking away the charter, the rights of the
stockholders shall be protected, so far as it
is consistent with the act of repeal itself. I
do not doubt that the legislature may alter,
ref oke or annul, any existing bank char
ter, whenever in its opinion the continuance
of the charter may be injurious to the citizens
of the Commonwealth. Any other construc
tion of the Constitutional reservation would
make the interests and safety of the public
subservient to the gain of the private stock
holder, Believing-, therefore, that there is no
want of power, I cannot refrain from expres
sing my decided opinion that whenever it :18
clear• that a bank is insolvent, or in great
danger of becoming so, or whenever its priv
ileges arc so used or abused as to seriously
prejudice the interests; of the public, it is the
duty of the law making power to protect the
people, by destroying its corporate existence.
In this connection I deem it my duty to re
iterate the - views expressed in my inaugural
address. I then stated, as my decided opin
ion. that there should be no further increase
of banks or banking, capital under the pres
ent system—expressed a decided hostility to
the issue of notes of a small denomination—
and recommended such a change in our laws
relative to banks, their organization and
management, as would at least secure beyond
all question the prompt redemption of all
bills or notes put in circulation by the sever
al banking institutions of the commonwealth.
Well satisfied of the imperfection of exist
ing laws relative to banks and banking, I
deem it a duty to inform the General Assem
bly that I cannot give the Executive approval
to any bills chartering additional banks with
out a radical change in the entire system.—
It is but just to state that in my opinion a
large. majority of the banks of the Common
wealth are well and safely managed, and in
a perfectly sound condition, but this is due
to the honesty and intelligence of those hav
ing charge of them, rather than to the effi
ciency of the laws. Under the management
of incapable or dishonest men, experience
has shown, that there is really but little if
any security to the public in the regulations
and restrictions now to he found in our bank
ing code. True wisdom dictates a forma
tion.
The ruinous losses which have fallen upon
the people during the financial pressure of
the past eighteen months, suggest the neces
sity of preventing their recurrence. Al
though many causes may have combined to
produce these disasters, it is too plain to ad
mit of doubt that our banking system has
been one of the most prominent. The value
of the precious metals—the prices of proper
ty—and the wages of labor—are always af
fected by the abundance or scarcity of the
paper medium received as a substitute for
gold and silver coin. The power of the State
to authorize a paper currency, through the
agency of banks, has been so long exercised,
and acknowledged, throughout the Union,
that it is no longer an open question. But
it must be acknowledged that the power has
been greatly abused. The delegation of this
Editor and Proprietor.
NO, 29,
attribute of so% ereig,nty to a number of irre
sponsible corporations without proper checks
to limit its exercise, and without providing
any security whatever, for the redemption of
the issues thus authorized, has been attended
with evils of the most alarming character.
These corporations are practically made the
exclusive judges of the amount of paper cur
rency to be furnished to the people, and have
the exclusive power to contract or expand
their circulation at pleasure. Depositors and
other ordinary creditors of banks, need no
legislation for their protection. Every one
who has direct dealings with these institu
tions, either as depositor or otherwise, enters
into such engagements voluntarily for his own
advantage, and may be safely left to his own vig
ilance, and the ordinary remedies of the law,
for his protection. But the millions of peo
ple engaged in industrious pursuits, the far
mer—the mechanic—the merchant—and the
laboring man—arc under an imperious neces
sity to receive for their merchandise and their
labor, the ordinary paper currency of tho
country. It is possible for persons of this
description to investigate the concerns of ev
ery institution whose notes are in circulation.
But no investigation could save them from the
losses arising from the defaults and frauds
of bank offit:ers and the insolvency of hank
borrowers.
The note holders of banks have peculiar
claims to the protection of the government.—
They are involuntary creditors, who are
forced to receive the notes authorized by the
government. They have no direct dealings
with the banks. They do not trust the
banks from any hope of gain. They have nu
profit in passing the notes which they would
nut have had in passing gold and silver
coin. They constitute almost the entire com
munity, and the humble and ignorant are al
ways the greatest sufferers when a bank fails
to redeem its notes. The whole people are
therefore deeply interested in the security of
the circulation allowed by law, although
many of them may never have had a share
of bank stock, or been within a hundred
miles of its place of business. The Govern
ment that authorizes the issue of a paper cur
rency is under a high moral obligation to
require ample and available security for its
redemption.
The certificates of loan issued by the Gen
eral Government, or by this Commonwealth,
at a value to be fixed upon, with the power
to require additional deposits of security,
from time to time, as the loans depreciate in
the market, would be as safe and available
as any guaranty which could be provided.
A law requiring all issues of banks here
after organized, to be secured by the pledge
of these loans, would enhance the vale
the present loans, and thus give the le '
a premium not contemplated when th- - :
came purchasers, and for which they er
gave any valuable consideration. This en
hanced value would be derived from a privt
lege granted by the State, and the State ought,
therefore to have the benefit of it, as far as
this may be secured by legislation. The re
cent amendment of the Constitution circum
scribes the power of he Legislature in crea
ting State debts, with an exception in favor
of debts contracted " to redeem the present
outstanding indebtedness of the State." A
law authorizing new State loans for the pur
pose of redeeming the present over due debt,
would be within the constitutional exception
and would be free from objection on constitu
tional grounds.
The new loans thus authorized, redeema
ble at the expiration of twenty years, with
the banking privilege attached to them, would
undoubtedly sell at a high premium. The
proceeds of their sole should be applied to
the payment of the present State debt, now
overdue, amounting to more than seventeen
millions of dollars. Under this system the
State loans would no longer be held by foreign
ers, and the semi-annual shipments of specie,
to pay interest, would therefore cease.
As the currency would be limited to the
amount actually secured, the danger from
expansions, which have therefore stimulated
the incautious to embark in ruinous enter
prises, in overtrading, and in extravagance
in their expenditures, would be greatly les
sened, if not entirely ON ercome. As the se
curities would be in the hands of a high and
responsible officer of the State, with authority
to sell them for the purpose of redeeming
the circulation, the power of the banks to
arrest specie payments at their own pleasure
would lie at an end. The system proposed
is as, near an approach to a specie basis as
the condition and habits of the people are at
present prepared for. The duty of securing
the community from losses continually ari
sing from unsafe currency, cannot be longer
delayed without a manifest disregard of the
public interests. The subject is therefore
commended to your early attention.
The report of the Commissioners appointed
to contract for and superintend the erection Of
a monument to the memory of citizens of
Pennsylvania, who were slain or lust their
lives in the late War with Mexico, will Munn,
the Legislature of the proceedings had on
that subject. After receiving proposals for
the erection of the monument, and the adop
tion of a plan, it is determined, in view of
the limited and inadequate appropriation
made for the accomplishment of the purpose
by the last Legislature, to postpone the com
mencement of the work until further leeisla
don could be had. It is the opinkn of the
Commissioners that such a monument as
would do credit to State, and honor to the liv
ing and the dead, cannot be built for a less
sum than thirty thousand dollars. If the
Legislature should concur in that opinion, the
ap propriation should be increased according-
The report of the State Librarian will in
form you of the progress made in the cata
logue authorized by the last Legislature, and.
the general condition of the Library, which
has grown to be an institution that deserves
your fostering care. I would commend to
your attention the suggestions of the Libra
rian.
The report of the Attorney General, which
Nvi 11 be laid before you, will exhibit the oper
ations of the Law Department of the Govern
ment for the past year. The Act of the 21st
of April, 1857, which requires the Attorney
General to keep an office at Harrisburg, and
which provides that all debts due to the Com
monwealth shall be collected by that officer,
has proved to be a highly beneficial enact
ment. Under its provisions large sums aro
saved which were formerly paid for commis
sions and counsel fees. And the improved
state of our finances is in no inconsiderable
degree owing to the prompt manner in which
outstanding claims are collected and paid into
the State Treasury.
The Adjutvnt General's report, which will
be laid before you, will show in detail the
present condition of the Military Department.
I would respectfully call the attention of the
Legislature to the recommendations of that
officer.
The Militia Law of 1858, has not been
fully tested; but it is believed to be, in the
main, an improvement on the laws in force
at the time of its passage. One of its best
features i and one that should be strictly au
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