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384 The "pet banks" and the surplus. [i833-6 friends of Clay now assumed the name of Whigs. They were contending, they said, against a government just as arbitrary, just as tyrannical, as that of George III against which their fathers had rebelled. It was time therefore to return to the principles and assume the name of the American Whigs of the Revolution. The suggestion was approved; and during the rejoicings which followed the triumph of the party in the spring elections the name came into general use as that of a distinct national party. As time passed and it was seen that the deposits were not to be restored, that the great Bank was not pressing the small ones, and that the "pets" were ready to advance money on easy terms, confidence returned and the money famine passed away. But the end was not yet. A rage for State banking swept over the country. A host of new institutions with State charters sprang up to share the business once done by the Bank of the United States ; the banking capital of the country increased from $196,000,000 in 1834 to $281,000,000 in 1836 ; and millions of additional bank-notes were put into circulation. Despite the biennial reductions in tariff rates, the revenue from imports steadily increased from $16,000,000 in 1834 to $23,400,000 in 1836; and, the national debt having been paid in full (January 1, 1835), a surplus began to roll up in the " pet " banks, which were instructed to lend it out on as easy terms as possible. Everything thus combined to make money cheap ; and, being cheap, it was quickly borrowed and used in wild speculations of every sort. Cotton, city lots, town lots, imported goods, in short, almost everything that could be bought and sold, became a subject of speculation. But the article whose sale affected the revenues and contributed most to swell the surplus was government land. Before the year 1834 the annual sales of land had never amounted to $3,000,000; but in 1835 they rose to $14,757,000, and in 1836 to $24,877,000. In consequence of these abnormal receipts the surplus grew rapidly. In 1835 (October 1) it stood at $18,000,000 ; in 1836 (March 1) it was $33,500,000, and seven months later $41,500,000. The two questions now before the Administration were how to prevent the further increase of the surplus, and what to do with that already accumulated. It was finally decided to distribute the annual sales of public land among the States, and to present them also with the existing surplus. To give it outright was held to be unconstitutional ; but this difficulty was avoided by an agreement to deposit the money with the States, subject to recall at any time, after due notice, by the Secre- tary of the Treasury a call which everybody knew would never be made. These two measures the distribution of the land sales and the deposit of the surplus were combined in one bill, which became law in 1836. From the surplus on the books of the Treasury on January 1, 1837, $5,000,000 were to be deducted, and the balance was to be deposited with the States in four instalments payable on the first days of January,