James Madison Papers
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From James Madison to William Harris Crawford, [4 February 1817]

To William Harris Crawford

[4 February 1817]

The letter & papers returned Feby. 4 with the following note.

The arrangement communicated by the Presidt. of the U.S. Bank is So important an advance towards a universal return of specie circulation, that the Treasury sanction to it render existing circumstances evidently proper. Serious difficulties will notwithstanding remain to be encountered, if the pr[i]ncipal Banks in every State do not immediately follow the example set them. Even in the States comprizeing [sic] the Banks, parties to the arrangemt, the payment of the internal taxes after the 20th. inst: will be distressing to many not possessing the notes of their own Banks. In the other States the payment in the legalized notes, will be generally impossible for a considerable time.1

Draft (DLC). Written at the foot of Crawford to JM, 3 Feb. 1817.

1Banks throughout the nation had generally been reluctant to resume specie payments after the conclusion of the War of 1812. At a 6 Aug. 1816 convention of delegates representing banks in New York, Philadelphia, and Baltimore, it was resolved that it would not be safe for state banks to resume specie payments before the first Monday in July 1817 and that this resolution be communicated to the Treasury Department. Following a subsequent convention held in New York in late January 1817, delegates from these banks agreed, in response to “certain propositions offered to the Convention by a committee on behalf of the Bank of the United States,” to resume specie payments on 20 Feb. 1817. The Bank of Virginia and the Farmers Bank of Virginia also decided to adhere to this decision (Daily National Intelligencer, 20 Sept. 1816, 31 Jan. 1817, and 4, 8, 13, and 17 Feb. 1817).

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