Nathaniel Macon Quotes
Paper money never was beat.
Nathaniel Macon, 1757-1837, U. S. Congressman & Senator (NC), Congressional Debate on the issuance of paper money, April 18, 1814
Sourced by: Eigen's Political and Historical Quotations
At the time, a bank note—paper money issued be a private bank—was not backed by any gold or silver and was not insured bym the government. A bank could print as much as they wanted, so it was always worth less as the further you were from the particular issuing bank, the less you could get your bank note, because no one knew whether or not the issuing bank would redeem the note or even be in existence. So every private bank note had diminished value for the public. However, carrying gold and silver around and making change for precious metals was difficult and often impractical. So people used banknotes. The same thing happens with credit cards today. The merchant has to pay a fee to the credit card company and the bank and therefore charges us more for whatever we buy. But most consumers and merchants are willing to pay the difference to obtain the convenience of the credit card,
The exact phrase has not been found in Gresham's writings but the idea appeared in a 1558 letter to Queen Elizabeth I. The expression has come to be known as Gresham's Law.
The same argument can be made against the modern paper money supply. What Jefferson and most of the founding fathers, with the exception of Alexander Hamilton. did not realize was that the major stability of any kind of money was not only the silver or gold that backed it but the political and legal stability of the nation and the size of its productive economy. Where Jefferson was right however is that all these banknotes at the time were issued by local private banks. The Government had no responsibility for paper money and had no knowledge of how much paper money any bank issues and whether or not they had any silver to back it up. Banks didn’t trust other bank’s notes and would only redeem them at a discount. A $10 note from a South Carolina bank might only be worth $7 in New York and $6 in Boston. The early American monetary system was a mess.
What Franklin Delano Roosevelt began, President Nixon would in 1971 complete by removing America from the gold standard entirely and ending fixed rates of exchange. There have been those in government who did not understand the modern economics of money and who believed that currency had to have a fixed rate of exchange for gold or silver otherwise it was worthless. Roosevelt had to deal with them as did Nixon later. Even into the 21st century when it had been amply demonstrated that the best currency in the world was the United States dollar precisely because it was backed up by the full faith and credit of the United States Government, there were those who complain that United States money is not sound currency and argue for the return of the gold standard.
America had a difficult early history with money—especially paper money which had been issued by private banks but were trusted by few. Paper money had for the first time had been issued by the Federal Government during the Civil War. Many saw it as a wartime measure but not a good practice to follow. Garfield, along with many other leaders thought that it was not constitutional for Congress to issue paper money. Others prevailed as the need for a lighter and more practical form of currency was necessitated by a growing economy. Coins for large transactions between businesses especially was very awkward when chests of coins had to be delivered to pay for cattle, produce or manufactured goods at the wholesale level.
This is the first major history of banks written in the United States.
Nathaniel Macon was an American politician who represented North Carolina in both houses of Congress. He was the fifth Speaker of the House, serving from 1801 to 1807. He was a member of the United States House of Representatives from 1791 to 1815 and a member of the United States Senate from 1815 to 1828. He opposed ratification of the United States Constitution and the Federalist economic policies of Alexander Hamilton. Thomas Jefferson dubbed him "Ultimas Romanorum"—“the last of the Romans”.
