Raftsman's journal. [volume] (Clearfield, Pa.) 1854-1948, 1861-12-18
SECRETARY CHASE ON THE CURRENCY,

From the New L OrR World. sa
Now that the vaguely fOreshado owed plan OF
Secretary Chase for remodeling the currency
IS before the public in an authentic shape, the
country will be better prepared to appreciate
the innovation he proposes. 1t will be seen
that his plan does not contemplate the creation
of a national bank, and is not, exposed TO the
objections which would apply to a great fnan-
cia monopoly which might be perverted into
gigantic engine of political influence; OBJ
jections by which the old United States Bank
was demolished and made odious. Mr.. Chase
has no disposition to rovive that obsolete in
stitution, or. anything resembling it. The
discussion of the measure he proposes cannot
be conducted by furnishing mp the rusty argu-
ments of the bank controversy of the last gen.
Grafton.
The State banks, as we understand Mr. {.
Chase's plan, will remain as at present, and
continue to conduct banking business of the
country, the most important part of which
consists in discounting commercial paper.
But instead of paying out their own notes they
will use notes prepared be the government,
and registered in the Treasury Department,
which they will obtain by the deposit and
pledge of an equal amount of government Sc
curites. These notes will be redcemable fn
specie by the banks issuing them, and will be
receivable for all government dues except
customs dutie.
This scheme would seem to combine all the
advantages which were claimed for the old
United States Bank, without its drawbacks.
1t would regulate and give uniformity to the
currency, facilitate exchanges, give adequate
and ample security TO the bill holder, and en-
able the government to obtain wit hout difficult
ty all the loans needed for conducting the
war, and for carrying the public debt when the
war shall have closed. The money power OF
the country would not be centralized, as it
was under the old bank, but divided, now,
among multitude of rival institutions scat
tered though all the states. Illinois currency
would be equal to New York currency, and
the great agricultural region of the West
would not be taxed, as heretofore, three or
four per cent. OF the annual value of its pro.
ducts in the difference of exchange between
the western and the eastern cities.
A small but gradually increasing tax on all
bank notes, except those issued by government
authority, would quietly take the former ont
of circulation, and, without any abrupt or dis
turbing changes, substitute The latter. The
process would not be essential lily different
from that now adopted by bAnks in New York
in getting their notes registered and counter
signed in the bank department at Albany.
Banks finding them more econom ical than the
taxed notes prepared by themselves would de-
posit with the proper officer an amount of gov
ernment securities equal to that wanted of the
notes. The liability of the bank to redeem in
spcCic All tH0 Hotco IL put III CiICuldtiou "ouIu
act as a check on excessive issues, which
would be susceptible of a still further check
by the action OF the government itself, which
would at all times know the amount of such
notes in use. .'-----. -----f.-r'-
A capital advantage of this plan is that it
would interest every moneyed institution.
every capitalist, and almost every citizen of
the country is sustaining the credit of the
government, and would furnish to the COM
munity strong personal motives for submitting
to whatever taxes might be necessary for pre-
venting the depreciation of the public secu-
rites. a-s ESQ
Another advantage, and the one which has
led to the proposal of this plan at this time, is
the large demand which its adoption would
create for government securities as a basis for
banking, thus cuabling the treasury to obtain
the large loans needed for the war without
straining its credit. r.a-
This is so large and complex a subject, and
i sound currency is vital to every interest,
that, favorable as Mr.. Chase's plan appears at
first blush, it ought not to be adopted by Con-
grcss without the most thorough scrutiny.
1t will be canvassed in all its bearings by the
best financial minds of the country; and it is
TO be hoped that Congress will seek their aid
and profit by their views in the formation OF
its judgement. The currency is too delicate
and too vital an interest for much tampering
by Hnsklllful hands, ard if Mr.. Chase's plan
should be adopted, it ought to be surrounded
with all the safeguards which the ripest expe-
rence suggest. The secretary has wisely
from specific recommendations as to
details, leaving these to be adjusted by Con-
gress after wise deliberation and full discus
sion.