Page:The New International Encyclopædia 1st ed. v. 10.djvu/593

INDEPENDENT CATHOLIC CHURCH. 519 INDEPENDENT TREASTJBY. tion gives it 33 ministers, 43 churches, and 42,- 850 communicants. INDEPENDENT METHODIST CHURCH. See Methodism. INDEPENDENTS. Such bodies of Chris- tians as claim the right of each individual church to administer its own aflairs, free from ecclesi- astical or civil authority. In history the name has been usually applied to the Congregationalists of Great Britain, who differ from the Congre- gationalists of America and other countries in regarding the fellowship of the local churches as unessential. The first Independent Church was organized in London about 1555, and the Brown- ists (q.v.), or Separatists, as the Independents •were first called, steadily increased in numbers, in spite of persecutions and emigration. They were prominent in the Westminster Assembly. See CoNGREGATIOX.LISM. INDEPENDENT TREASURY. Tha name given to the system of keeping and disbursing the public money without the intermediary action of banks, State or national, adopted by the United States in 1840. The act of August 6, 184(), pro- vided, in brief, that the public revenues should be held, imtil actually paid out, in the vaults of the Treasury at Washington or in the several subtreasuries in the larger cities created by the act. Prior to this date the Government receipts had been deposited in banks. The first Bank of the United States (see Bank, Banking) was established in 1791, largely with the view of facilitating the fiscal operations of the Govern- ment. In it or its branches were deposited the Government funds, and from it were obtained temporary loans in anticipation of the revenue. When the bank charter expired, in 1811, the Gov- ernment funds were deposited in the State banks throughout the country. With the subsequent suspension of specie pajTuents, in 1814, the Gov- ernment not only suffered with other creditors, but was seriously embarrassed by the fact that there was no standard national currency. In 1816 the second bank of the United States was char- tered for a period of twenty years, and for the greater part of its existence it acted as the fiscal agent of the Government. Its effort, beginning in 1829, to obtain a renewal of its charter, led to a violent political contest, in which the op- ponents of the bank, led by President Jackson, won the victory. Though the charter did not expire until 1830, the President in 1833 ordered that no further deposits of Government funds be made in the bank, and that the funds of the Government be gradually withdrawn. This order for the 'removal of the deposits' was made on the alleged ground that the bank was unsound and that the public money was in danger. Beginning October. 1833, the Government funds were deposited in State banks. Contracts were entered into between the Secretary of the Treas- ury and the several banks fixing the conditions upon which deposits were to be received. The re- fusal to recharter the Bank of the United States. together with the deposit of Government funds in the State banks, led to an ominous expansion of these institutions. A speculative era. marked especially by enormous sales of public lands, and the deposit or distribution of the Government surplus with (he States (1837) . now set in. which culminated in the panic of 1837. The Govern- ment funds were tied up in the non-specie-paying banks, and Congress was called together in Sep- tember, 1837, to devise measures of relief. Presi- dent Van Buren favored a complete .separation of the Government from the banks, the establish- ment of an independent treasury, and a require- ment that all debts due the Government be paid in specie. It was the latter provision which caused the defeat of the measure, as it appeared to the friends of the banks as a discrimination against the bank-note. Toward the close of Van Buren's Administration (.Tune 30, 1840) the measure for which the President had fought valiantly was enacted into law, but not without the concession that in the first year of its opera- tion only one-fourth of the Government receipts need be in specie, a further fourth being added each year until the whole should be so payable. The victory was dearly bought, for the party went down to defeat at the polls in November. The new Administration promptly repealed the law (August 13, 1S41) ; but in the fruitless con- troversy with President Tyler over the Bank Law failed to provide any substitute for it. Public officials were left to their own devices in the cus- tody of the public funds, and it was not until a new political revolution had occurred that the independent treasury svstem was finally estab- lished by the act of August G, 1846. The spirit of the measure was an absolute di- vorce of the Treasury from the banks. The Government was henceforth to keep its own funds, and to recognize only money issued by Federal authority, specie and Treasury notes, in the Gov- ernment operations. The vaults and safes pro- vided for keeping the money of the Govern- ment at Washington, and at such other places of deposit as were fixed by the law, were declared to constitute the Treasury of the United States. The Treasurer of the United States and assistant treasurers, and all other officials, were required to keep safely, without lending, using, depositing in banks, or exchanging for other funds, except as allowed bj' the act, all public money received by them or otherwise in their custody, until the same was ordered by proper authority to be transferred or paid out. In the early experience of the system some em- barrassment was created by the failure to pro- vide at once the necessarj' protection for the money in all the places where it was kept. But in general the system has worked well, and loss by theft or defalcation has been slight compared to the loss suffered through dealings with un- soun(f banks in earlier years. The isolation of the Treasury contemplated by the act soon proved illusory, and little by little inroads have been made upon the principle. The spectacle of the Treasury coming to the 'relief of the money market' has become familiar. The 'relief thus afforded consists of placing in circu- lation money which the law accumulates in the hands of the Government. Operating with a sur- plus of revenue over expenditure, the Government balances may and do giow to such a size as to materially affect the volume of money in circu- lation. This, then, is a Treasurj- reserve which may be unloosed when a stringency in the money market occurs, and the fact that the Secretary of the Treasure' is called upon for such relief is evidence of the futility of attempting utterly to separate the Government's ojicrations from all business affairs. The independent Treasury was not ten years old before the possible dangers of