144 BANKING THEORIES IN UNITED STATES
denominations generally favored by those who were opposed to
smaller notes, so that the discussion was, after all, not exactly
comparable to that which took place in England, where five
pounds was usually the minimum proposed. Cooper did suggest
in 1826 that the logical course would be to prohibit all denomina-
tions not higher than the largest coin being struck by the mint
(twenty dollars).! After the middle of the century, twenty and
fifty dollars apparently became the favorite minima,” while, as
early as 1840, the editor of the Democratic Review urged the sup-
pression of all notes under one hundred dollars.® It was frequently
advocated that the smallest denominations be prohibited first
and the minimum gradually raised until the desired level was
reached. Gallatin added the suggestion (which it is interesting
to compare with the law of 1864 taxing the notes of state banks
out of existence) that Congress prevent the issue of undesirable
denominations by imposing a prohibitive stamp duty upon them.*
The Treasury Department, in sympathy with the hard-money
sentiments of Jackson, began to discriminate against small notes
in 1835, and Secretary Woodbury stated in his Finance Reporl of
that year that over two thirds of the States already had highly
salutary ‘‘usages or laws’ in existence regulating the denomina-
tions of notes.
Hildreth devoted twenty pages of his Banks, Banking, and
Paper Currencies to a defence of notes of smaller denominations,
presenting most of the more familiar arguments in their favor.
Smith’s fear that the privilege of issuing trivial notes would
enable men of faulty character to become bankers did not apply
to the United States, he thought, because banks here had to be
incorporated, or, if free, were required to furnish security for
1 Cooper, Lectures (1826), p. 147. Andrew Jackson recommended that twenty
dollars be the minimum in his message of 1835. Richardson, Messages of the Presi-
dents, iii, 166.
2 Middleton, Government and Currency (1850), p. 120; James Buchanan, Message
(1857), Richardson’s Messages of the Presidents, v, 441; John A. Dix, Bankers’
Magazine (1859), xiii, 517.
3 Democratic Review (March, 1840), vii, 202.
4 Gallatin, Letter to Biddle (Aug. 14, 1830), Writings, ii, 432. Several bills to
this purport were introduced in Congress during the next decade. See the National
Era (1857), p. 166.
