24 BANKING THEORIES IN UNITED STATES 
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Banks were also said to share with Hamilton's funding system 
(with which critics frequently associated them) the evil of tending 
to increase inequalities in the distribution of wealth.! This they 
were thought to do not only by virtue of the advantages, some- 
what mystical, which their owners were thought to enjoy, but 
also through favoritism in making their loans. As late as 1833, 
Thomas Cooper, president of South Carolina College, regarded it 
a very serious defect of banks, that they “tend mainly to create 
a money aristocracy.” He explained that banking “affords its 
facilities never to the poor, but as much as possible to the rich. 
The poor deal in small and insignificant sums, not worth the at- 
tention of a great banking house. Hence these institutions tend 
to make the rich richer, and the poor poorer and more depend- 
ent.” 2 
These considerations were political rather than economic. 
Their significance lies not so much in their influence on theory 
as in the evidence they give of the state of knowledge of the time 
with respect to banking. Moreover, similar arguments played no 
small part at a later date in determining practical policies. Jack- 
son’s opposition to the second Bank of the United States placed 
the bank question in politics, and for a while the monetary sys- 
tem of the country could scarcely be discussed on its merits. 
Curiously enough, with Jefferson and Jackson bitterly opposing 
the banking system in the introduction of which Hamilton had 
played so prominent a role, it was the political forefathers of 
William Jennings Bryan who were the ““sound-money”’ men of 
our earlier days. The opposition was at first to a national bank 
only, and was accompanied by approval of state banks. The 
Cp. Hamilton, Report on a National Bank (1790), American State Papers, Finance, 
i, 60; and Report of Virginia Committee on Banks (1816), Niles’ Register, ix, (Sup.) 
156. See Jackson’s Veto Message (183 2), in Richardson’s Messages of the Presidents, 
ii, 570-531. 
1 Morris, Address on the Bank of North America (1785), Sparks’s Life, iii, 441; 
Enquiry into the . . . Tendency of Certain Public Measures (1794), p. 47; George 
Logan, Letters to the United States Yeomanry (1793), p- 8; “The Paper System,” 
Niles’ Register (1818), xiv, 242. 
2 Cooper, Manual of Political Economy (1833), p. 83.