James Madison Papers

To James Madison from William Duane, 5 December 1809

From William Duane

Phila. 5 Decr. 1809


I have revolved for some time in my mind the ideas which in a crude form I have taken the liberty of addressing to you. I presume not to set any higher values on them than liberal intentions and an enthusiastic devotion to the principles and durability of Republican Government, may give them. I neither look for any answer nor do I wish for any thing more than, the gratification of endeavoring to promote what is honorable and glorious to my country.

If this should be acceptable or not intrusive on your time, I should take the liberty of addressing to you my ideas on the institution of a national Bank, the basis of which should be public lands, shares representing acres to a certain amount; the acres to be taken at a limitted period by the holder and the stock to go to the public; or the holder of stock to have his option of Cash for the share in Bank; and the land to become either the object of purchase at the rate of lands at the moment, or to become the representative of new shares: the objects of the plan, would be—1 To unite all the Eastern Bank holders by the tie of property in Southern lands; to make the reduction of Interest to 5 per Cent a part of the establishment, and by combining the shares in Bank with property in land, to cast off the pestilential influence which foreign stock and bank jobbers have on all our national concerns.1 In fact I have suggested the outline already; to a mind like Mr Gallatin’s such a plan would at once present itself in a manner that would give it form and efficacy, and I persuade myself that the useful objects which I have suggested would naturally grow out of it—Objects which I need not describe the vast importance of. I wish however not to be Known as suggesting the subject, because such a matter should stand upon its own foundations without prejudice or partiality to its author—circumstances which too often interfere with human interests & happiness. Excuse this trouble and permit me to subscribe myself your friend & respectful humb St

Wm Duane

RC (DLC). Docketed by JM.

1Duane’s proposal of a land bank was hardly original. It drew on a colonial tradition of using an almost unlimited resource (the public lands) as the capital for a bank scheme (Theodore Thayer, “The Land-Bank System in the American Colonies,” Journal of Economic History, 13 [1953]: 145–59).

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