Congress to restrain them when they were engaged in their wild banking legislation.[1] Now this committee made it an argument for repudiating the Territorial debt that the bonds had "been created by a government not of the people, but placed over them—a mere temporary arrangement by Congress, a police regulation only, a fugacious institute, three removes below even the Legislature of a State, and which, in chartering this bank, [Union Bank of Florida] and issuing these bonds, has attempted to usurp two of the highest attributes of sovereign power. These agents of federal authority in the selection of but part of which to rule over us the citizens of Florida are permitted by Congress to have a voice have, by this charter, sought to make us subject to their unlimited taxation, and render our posterity hereditary bondsmen."
The Governor, in 1845, charged upon the federal government "an unwise and ruinous legislation * * * worse, if possible than war, pestilence, and famine,—I mean the blighting influence of a corrupt and corrupting paper system, so utterly rotten that I cannot undertake its dissection."
The renewed Bank of Florida went into operation in 1843. A year later another Governor had to report upon "the evils which have attended the renewal of the Bank of Florida, the last in the series of infatuated experiments." He quoted sarcastically the passages in the messages of the two previous years, in which the former Governor had introduced this new enterprise with approval, the latter one he says, uttered "but a few weeks before the bank escaped your jurisdiction by flight."
The debt of the Territory was $500,000 for Indian wars and $3.9 millions for banks.[2]
In January, 1844, all the banks of Florida were defunct. Speaking of the Union Bank, the Governor said: "The principal cause of the delinquency of the bank may be traced to the elements of its organization. By the provisions of its charter each stockholder had a right to draw from the bank, as a permanent loan, two-thirds of the value of the property mortgaged by them as an indemnity to the Territory. This right has almost invariably been exercised, and thus two-thirds of the whole capital of the bank, raised on the faith and responsibility of the Territory, has passed into the hands of a few individuals, who, with a trivial exception, have been unable or unwilling to pay the interest. There is now due the bank, from the accumulation of interest on these loans, $216,000, and for interest on accommodation paper a greater amount, which has produced a total inability on the part of this institution to pay the interest due semi-annually to the bondholders. The bank has, in many instances, resorted to legal process to compel the delinquent stockholders to comply with their engagements, but, so far as I am advised, it has been hitherto unsuccessful; and the opinion is entertained by many that the stockholders may continue to enjoy the loan
