THE MERITS OF BANKS

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venience as a medium of payment of bank deposits, representing
credit for money actually brought to the bank.!
No less primitive arguments furnished the bulk of the weapons
of opponents of banks in the early years. On both sides much
more attention was given to superficial assertions derived from
naive prejudices than to arguments based upon thoughtful analysis
 of the part banks play in our economic life. Gouverneur Morris
summarized conveniently the objections offered in 1785.2 The
danger of permitting so powerful a monied interest, coupled with
chauvinistic fear of its control by foreign capitalists — both rendered
 familiar by the debates later occasioned by the two Banks
of the United States — were already playing a part in this discussion
 of our earliest bank.?
Along with the fear of foreign domination of so important an
institution, was sometimes found the Mercantilistic notion that
the holding of our stock abroad was in itself undesirable because
of the loss of specie which the payment of dividends would represent.
 Robert Morris, who took a leading part in the Pennsylvania
 Assembly in championing the cause of his favorite, the
Bank of North America, replied most effectively to this. ‘‘Pennsylvania,”
 he aptly said, “so long as her citizens can derive a
better income from the capitals of Europeans vested in our bank
stock, than those Europeans derive from the dividends, ought to
hold out encouragement for an increase of such stockholders,
rather than pursue measures for diminishing their shares.” ®
Mathew Carey still dealt, not without impatience, with a similar
objection during the parallel controversy that attended the question
 of rechartering the first Bank of the United States.®
1 Cp. Pelatiah Webster, Essay on Credit (1786), in Essays, p. 443, on the advantages
 of payment by checks drawn upon deposit credits.
2 Gouverneur Morris, Address on the Bank of North America (1785), Sparks’s
Life of Morris, iii, 440, 441.
3 Ibid., iii, 440. See also, An Inquiry into the . . . Tendency of Certain Public
Measures (1794), p. 47; and Newman, Elements of Political Economy (1835), p. 115.
4 Sparks, 0p. cit., p. 440.
5 Carey, Debates and Proceedings, etc. (1786), p. 56.
6 _.. “the merest sciolist in political economy well knows that the employment
of foreien capital is eminently beneficial.” Carey, Desultory Reflections (1810), p. 21.