To James Madison from Alexander J. Dallas, [29 June 1816]
From Alexander J. Dallas
[29 June 1816]
Dear Sir,
The inclosed report gives you the result of our consultation on the Resolution of the 29. of April 1816. I entertained a doubt, for a moment, upon the power of the Treasury to make a discrimination in the terms of paying different descriptions of public debt and duties. I am satisfied, however, upon reflection, that the arrangement is indispensable for the accommodation of the country; and as the rule is a general one, applying to the kind of debt, and not to the person of the debtor, I perceive no breach of law, or of impartiality. As soon as the papers are returned to me with your opinion, I will act upon them. I am, Dear Sir, most respectfully & faithfully, Yr. obed Serv
A. J. Dallas
[Enclosure]
The Secretary of the Treasury has the honor to submit to the President of the United States the following Report:
Treasury Department. 29. June 1816.
That in pursuance of the authority given by the President, the Secretary of the Treasury prepared and submitted to the consideration of the Heads of Departments and the Attorney General, the Statement, founded upon the Resolution of Congress of the 29. of April 1816, relative to the collection of the revenue in the legal currency of the United States, which is hereunto annexed marked A.1
That the Secretary of State, the Secretary of War, and the Attorney General, assembled at the Treasury, after having only considered the Statement; and in answer to the several questions therein proposed, it was unanimously decided,
1st. That it is not the duty of the Secretary of the Treasury at this time, nor at any time before the 20t of February 1817, to demand that all payments to the United States shall be made in the manner specified in the Resolution of the 29. of April 1816.
2d. That it is not the duty of the Secretary of the Treasury at this time, nor at anytime before the 20t of February 1817, to cause the Notes of the State Banks, which are not payable and paid on demand in the legal currency of the United States, to be refused in all payments to the United States.
3d. That it will be expedient and proper for the Secretary of the Treasury to adopt the measures, which he has suggested; to wit,
A Circular letter to the State Banks in the form of the draft marked B.2
A Proposition to the Banks in the form of the Notice marked C.3
If the State Banks, or a considerable number of the most influential Banks of the Commercial Cities, accede to the proposition, it will be adviseable to announce and enforce it, as a Treasury regulation. If there should not be such an accession of the Banks, it will be adviseable and proper to suspend any further proceedings, until the 20. of February 1817; when it will be the duty of the Secretary of the Treasury to demand, that all payments to the United States be made, in the manner specified in the Resolution of the 29. of April 1816. All which is respectfully submitted,
A. J. Dallas
Secretary of the Treasury.
RC and enclosure (CSmH). RC undated; date assigned based on date of enclosure.
1. Document not found.
2. The draft has not been found, but on 22 July 1816 the Treasury released a circular letter to presidents of the state banks. This was published in the 30 July 1816 issue of the Daily National Intelligencer, accompanied by an editorial headed “The Treasury,” in which Dallas explained how the Congressional resolution of 29 Apr. 1816 on the resumption of specie payments would be implemented. That statement may have incorporated the ideas Dallas transmitted to JM in the enclosures marked A and C. The letter of 22 July was subsequently reprinted several times in the Daily National Intelligencer and in newspapers throughout the nation.
3. Document not found.