《美国中央银行简史》英文版[1]

A Brief History of Central Banking in the United States by Edward Flaherty Source:http://www.freedomdomain.com/banking/central01.html --------------------------------------------------------------------- ------- Part I: The First and Second Banks of the United States At its most fundamental level, a central bank is simply a bank which other banks have in common. Small rural banks might each have deposit accounts at a larger urban bank to facilitate their transactions in the city. By this criteria, a financial system might have several central banks. More prosaically, a central bank is usually a government sanctioned bank that has specific duties related to the performance of the macroeconomy. Typically, an "official" central bank is charged by a central government to control the money supply for the purpose of promoting economic stability. It may have other duties as well, such as some degree of regulatory power over the financial system, operating a check-clearing system, or to perform general banking services for the central government. Most industrialized economies have a central bank. The Bank of England, the Bank of Japan, the German Bundesbank, and the United States Federal Reserve are all central banks. While their organizational structures and powers vary, each bank is responsible for controlling its nation's money supply. The history of central banking in the United States does not begin with the Federal Reserve. The Bank of the United States received its charter in 1791 from the U.S. Congress and was signed by President Washington. The Bank's charter was designed by Secretary of the Treasury Alexander Hamilton, modeling it after the Bank of England, the British central bank. The Bank met with considerable controversy. Agrarian interests were opposed to the Bank on the grounds that they feared it would favor commercial and industrial interests over their own, and that it would promote the use of paper currency at the expense of gold and silver specie (Kidwell, 54). Ownership of the Bank was also an issue. By the time the Bank's charter was up for renewal in 1811, about 70 percent of its stock was owned by foreigners. Although foreign stock had no voting power to influence the Bank's operations, outstanding shares carried an 8.4 - 1 - percent dividend. Another twenty year charter, it was argued, would result in about $12 million in already scarce gold and silver being exported to the bank's foreign owners (Hixson, 115). Secretary of State Thomas Jefferson believed the Bank was nconstitutional because it was an unauthorized extension of federal power. Congress, Jefferson argued, possessed only delegated powers which were specifically enumerated in the constitution. The only possible source of authority to charter the Bank, Jefferson believed, was in the necessary and proper clause (Art. I, Sec. 8, Cl. 18). However, he cautioned that if the clause could be interpreted so broadly in this case, then there was no real limit to what Congress could do. Then, curiously, in the memorandum in which he articulated his thoughts on this matter, Jefferson advised that if the President felt that the pros and cons of constitutionality seemed about equal, then out of respect to the Congress which passed the legislation the President could sign it (Dunne, 17-19). James Madison said the Bank was "condemned by the silence of the constitution" (Symons, 14). Hamilton conceeded that the constitution was silent on banking. He asserted, however, that Congress clearly had the power to tax, to borrow money, and to regulate interstate and foreign commerce. Would it be reasonable for Congress to charter a corporation to assist in carrying out these powers? He argued that the necessary and proper clause gave Congress the power to enact any law which was necessary to execute its powers. A "necessary" law in this context Hamilton did not take to mean one that was absolutely indispensable. Instead, he argued that it meant a law that was "needful, requisite, incidental, useful, or conducive to." Then Hamilton offered a proposed rule of discretion: "Does the proposed measure abridge a pre-existing right of any State or of any individual?" (Dunne, 19). Hamilton's arguments carried the day and convinced President Washington. The Bank of the United States had both public and private functions. Its most important public function was to control the money supply by regulating the amount of notes state banks could issue, and by transferring reserves to different parts of the country. It was also the depository of the Treasury's funds. This was an important function because, as later experience would prove, without a central bank, the Treasury's deposits were placed in private commercial banks on the basis of political favoritism. The Bank of the U.S. was also a privately owned, profit-seeking institution. It competed with state banks for deposits and loan customers. Because the Bank was both setting the rules and competing in the marketplace especially irritated state banks, and they joined with agrarian interests and Jeffersonians in opposition to the Bank. The Bank was supervised by the Secretary of the Treasury who could inspect all the - 2 - Bank's transactions and accounts, except those of private individuals, and order audits on demand (Ibid, 11-13). The Bank's ownership was set by $10 million in capital, divided into 25,000 shares of voting stock with a par value of $400 each. About 80 percent of the stock was sold to the public with the remainder capitalized by the federal government. No individual could own more than 30 shares. Shares were also sold to foreigners, although the Bank's charter did not grant them voting rights (Phalle, 43). The First Bank of the United States is considered a success by economic historians. Treasury Secretary Albert Gallatian commented that the Bank was "wisely and skillfully managed" (Hixson, 114). The Bank carried a remarkable amount of liquidity. In 1809, for example, its specie/banknote ratio was about 40 percent (compared to a modern average reserve/deposit ratio of about 12 percent) making it probably the most liquid bank in the U.S. at the time. Despite the liquidity, the Bank was also profitable, earning most of its income through substantial loans to both government and private business. It helped to end several bank runs by transferring funds to banks in need of temporary liquidity. The chief argument in favor of the Bank's renewal in 1811 was that its circulation of about $5 million in paper currency accounted for about 20 percent of the nation's money supply (Symons, 12). It was the closest thing to a national currency that the U.S. had. Ironically, this may have contributed to its downfall because the Bank's issuance of notes came at the expense of state banks. In addition, the currency issued by the Bank was not discounted, whereas the currency issued by the 712 state banks were discounted anywhere from 0 to 100 percent. However, the arguments against the Bank were too strong. Foreign ownership, constitutional questions (the Supreme Court had yet to address the issue), and a general suspicion of banking led the failure of the Bank's charter to be renewed by Congress. The Bank, along with its charter, died in 1811. Following the Bank's disappearance, state banks, unhindered by either state regulations or the discipline imposed by the Bank of the U.S., greatly increased the number of bank notes in circulation. John K. Galbraith writes of the period, "State banks, relieved of the burden of forced redemption [imposed by the First Bank], were now chartered with abandon; every location large enough to have 'a church, a tavern, or a blacksmith shop was deemed a suitable place for setting up a bank.' These banks issued notes, and other, more surprising enterprises, imitating the banks, did likewise. 'Even barbers and bartenders competed with banks in this respect'" (Galbraith, 58). Coupled with the disruptions associated with the war with England, this caused considerable inflation from 1812-1815. During that period, prices rose an average of 13.3 percent per - 3 - year. An 1815 attempt to establish a new central bank failed, but by 1816 a consensus emerged for a return to central banking (Ibid, 13). The Second Bank of the U.S. was chartered in 1816 with the same responsibilities and powers as the First Bank. However, the Second Bank would not even enjoy the limited success of the First Bank. Although foreign ownership was not a problem (foreigners owned about 20% of the Bank's stock), the Second Bank was plagued with poor management and outright fraud (Ibid). The Bank was supposed to maintain a "currency principle" -- to keep its specie/deposit ratio stable at about 20 percent. Instead the ratio bounced around between 12% and 65 percent. It also quickly alienated state banks by returning to the sudden banknote redemption practices of the First Bank. Various elements were so enraged with the Second Bank that there were two attempts to have it struck down as unconstitutional. In McCulloch v. Maryland (1819) the Supreme Court voted 9-0 to uphold the Second Bank as constitutional. Chief Justice Marshall wrote "After the most deliberate consideration, it is the unanimous and decided opinion of this court that the act to incorporate the Bank of the United States is a law made in pursuance of the Constitution, and is part of the supreme law of the land" (Hixson, 117). The Court reaffirmed this opinion in a 1824 case Osborn v. Bank of the United States (Ibid, 14). Not until Nicholas Biddle became the Bank's president in 1823 did it begin to function as hoped. By the time the Bank had regained some control of the money supply and had restored some financial stability in 1828, Andrew Jackson, an anti-Bank candidate, had been elected President. Although the Second Bank was not a campaign issue (Biddle actually voted for Jackson), by 1832, four years before the Bank's charter was to expire, political divisions over the Bank had already formed (Ibid). Pro-Bank members of Congress produced a renewal bill for the Bank's charter, but Jackson vetoed it. In his veto message Jackson wrote, A bank of the United States is in many respects convenient for the Government and for the people. Entertaining this opinion, and deeply impressed with the belief that some of the powers and privileges possessed by the existing bank are unauthorized by the Constitution, subversive of the rights of the States, and dangerous to the liberties of the people, I felt it my duty...to call to the attention of Congress to the practicability of organizing an institution combining its advantages and obviating these objections. I sincerely regret that in the act before me I can perceive none of those modifications of the bank charter which are necessary, in my opinion, to make it compatible with justice, - 4 - with sound policy, or with the Constitution of our country (Ibid, 14-15). Jackson was not opposed to central banking, per se, but to the Second Bank in particular. No other bill to renew the Bank's charter was presented to Jackson, and so the Second Bank of the United States expired in 1836. The U.S. would be without an official central bank until 1913 when the Federal Reserve System was formed. Jackson believed that the nation's money supply should consist only of gold or silver coin minted by the Treasury and any foreign coin the Congress chose to accept. This view was fully impractical. The gold and silver stocks of the U.S. were terribly inadequate to provide a sufficient money supply of Jackson's preference. The U.S. at that time had no substantial mines of its own and regularly had a trade deficit, so there was no dependable method to increase the money supply under what Jackson perceived to be the only Constitutional monetary system. However, few others shared Jackson's opinions on this matter. Even the so-called "Jacksonian" Supreme Court ruled in 1837 in Briscoe v. Bank of Kentucky that state-chartered banks, state-owned banks, and the banknotes they created were fully Constitutional (Hixson, 119). Combined with the unanimous 1819 McCulloch ruling, the legal environment of the U.S. had clearly established that central banking, state banking, and paper currency issued by both entities were Constitutional. That the U.S. chose to proceed through the balance of the nineteenth century without a central bank would lead to interesting and creative measures to construct a financial system. References: Dunne, Gerald T., Monetary Decisions of the Supreme Court, New Brunswick, New Jersey: Rutgers University Press, 1960. Galbraith, John K., A Short History of Financial Euphoria, New York: Penguin Books, 1990. Galbraith, John K., Money: Whence it Came, Where it Went, Boston: Houghton Mifflin, 1995. Hixson, William F., Triumph of the Bankers: Money and Banking in the Eighteenth and Nineteenth Centuries, London: Praeger, 1993. Kidwell, David S. and Richard Peterson, Financial Institutions, Markets, and Money, 5th edition, 1993. - 5 - Nussbaum, Arthur, A History of the Dollar, New York: Columbia University Press, 1957. Phalle, Thibaut de Saint, The Federal Reserve: An Intentional Mystery, New York: Praeger, 1985. Symons, Edward L., Jr. and James J. White, Banking Law, 2nd edition, 1984. --------------------------------------------------------------------- ------- --------------------------------------------------------------------- ------- Part II: The American Free-Banking Experience, 1836-1860 Following the demise of the Second Bank of the United States in 1836, the American financial system entered a period frequently termed by economic historians as the "free banking era." These were the years 1837-1862: the time between the Second Bank and the first of the National Banking acts. The only banks in the U.S. were those chartered by the states. The federal government neither chartered banks nor regulated the existing state banks. Under a chartered bank system, a bank could only begin operations by a specific act of a state's legislature. The charter issued by the legislature would specify in what activities the bank could and could not engage, the interest rates that could be charged for loans and paid on deposits, the reserve ratio, the necessary capital ratio and so forth. The issuing state was also responsible for regulating the activities of the banks it created. The first bank licensed in this manner was the Bank of North America in 1782 and which operated in Philadelphia. It was designed by Alexander Hamilton and modelled after the Bank of England. Although bank-like institutions existed in the colonial period, the Bank of North America was the first bank in the modern sense of the word. The bank was permitted to accept gold and silver coin, also called specie, for deposit and to issue banknotes in exchange. Banknotes were paper bills of credit that promised to pay the bearer the note's face value in specie on demand. The public accepted the banknotes as money because it had faith that the notes would in fact be redeemed by the bank in specie. The banknotes that augmented the money supply proved effective in stimulating economic activity. Its success inspired similar banks to be chartered in New York and Boston a few years later. By the end of Washington's administration, - 6 - twenty four state banks were in operation along with the Bank of the United States. The number tripled within the next dozen years despite the well-known opposition to banking of the next two Presidents, Adams and Jefferson (Hammond, 144-45). The ability of banks to issue money raises some interesting questions about the nature of money and about the legal aspects of its issuance in the United States. On these topics I will now briefly digress. Money is nothing more than a common numeraire which reduces the search costs associated with conducting beneficial trades. Money is also a psychological abstraction. Literally anything can serve in this capacity as long as people are willing to accept it as a medium of exchange, if it maintains its purchasing power reasonably over time, and if it can serve as a convenient unit of measure. An official government edict is not necessary to create money. The Constitution contains only two sections dealing with monetary issues. Section 8 permits Congress to coin money and to regulate its value. Section 10 denies states the right to coin or to print their own money. The framers clearly intended a national monetary system based on coin and for the power to regulate that system to rest only with the federal government. The delegates at the Constitutional convention rejected a clause that would have given Congress the authority to issue paper money. They also rejected a measure that would have specifically denied that ability to the federal government (Hammond, 92). Although the Constitution does not state that the federal government has the power to print paper currency, the Supreme Court in McCulloch vs Maryland (1819) ruled unanimously that the Second Bank of the United States and the banknotes it issued on behalf of the federal government were Constitutional. If the federal government only is permitted to issue money, coin or paper, then how could state banks issue money? State banks did not coin money, nor did they print any "official" national currency. However, state banks could print bills of credit in exchange for specie deposits. These notes would bear the issuing bank's name and entitle the bearer to the note's face value in gold or silver upon presentation to the bank. State bank notes were a form of representative money; they were not gold or silver, but they represented it. The notes were more convenient for conducting large transactions than their specie counterparts, and, more importantly for the extension of credit, could be produced easily whereas the gold and silver stock of the nation was relatively small and for the most part declining (Hixson, 12-13). The Supreme Court ruled in 1837 in Briscoe vs Bank of Kentucky that state banks and the notes they issued were also constitutional. - 7 - One potential problem with such a system is that banks may issue notes far in excess of their specie deposits. Customers appeared from time to time wanting to exchange their banknotes for specie. The banks, of course, made allowances for this by keeping some of the specie on hand at all times. If the specie/banknote ratio was too low, even a small unexpected increase in the withdrawal rate could force the bank into insolvency. Remaining depositors who had not withdrawn their specie would be left with worthless banknotes. The public accounted for this risk of non-redemption by discounting the notes of banks that were considered risky. For example, a $20 banknote issued by a bank with a reputation of redemption problems might carry a 5 percent discount off its face value. In other words, a local merchant might only give a customer $19 worth of goods for a $20 note with the difference compensating the merchant for the risk of accepting the banknote. Discounts on notes among functioning banks ranged from about 95 percent for the riskiest banks to zero for banks with a high degree of public confidence. On the advent of the free banking era, there were 712 state banks in operation in the United States, each with its own currency (Kidwell,