The New York herald., 1862-01-20
The Banks and tho Government.


From our Washington intelligence we learn
that great difference Of opinion exists between
the government and the banks whose delegatea
are now at the national capital, seeking to carry
their own views in Congress The difference
relates to the future financial action of the
government, the loans, tho debt, the currency,
taxation and the whole question of national
finances. There is not dollar in the treasury,
and yet Congress has done nothing to provide
the ways and means of carrying on the war.
The government is consequently embarrassed,
and should the present inaction of Congress
continue much longer the operations of the
army and navy will be brought to dead
lock.
The cause Of this delay is that the banks de-
sire the control of the currency, by which they
could make fortunes at the public expense.
They could depreciate it at pleasure, and they
would do so, thus making the finances of
the government q source of fraudulent
gambling, in which they would have the
cards stocked and be sure to win. Now,
the constitution gives the government the
control of the currency, and we hope it will
the example of another nation, which has had
much experience in war and finance. In all
the great wars of England coteries of bankers
have conspired to gain the position of million
aires by speculating in the loans Of the govern
ment and the currency. The Rothschilds, the
Barings, the Hopes Of Amsterdam, the Gold
smidts and others have accumulated untold
wealth by such means, and they are now q
power in Europe, controlling its governments
by their gold. Such power in our midst
would be despotism unknown to our con-
stitution and laws, and foreign to the genius of
our institutions.
Even in England the government, from time
to time, has found it necessary to keep banks
and bankers in check, and to regulate the action
of the Bank of England itself. Restriction acts,
suspension acts and orders in council have been
called into operation. When large issues of
paper money are necessary for the purposes
of government, the most delicate MANAGE
ment is necessary to prevent depre-
citation. If left in the hands of the bankers,
uncontrolled, the currency would soon be de-
preciated to ruinous figure. The only secu-
rity for the country Is In the firmness of the
government retaining the control which the
constitution gives it. The public safety is the
supreme law, and banks and bankers must
succumb or be crushed.
Let national currency, therefore, be issued
at once in the shape Of demand notes, to be
made legal tender during the war, and, after
having served their purpose in circulation, to
be funded. at the option of the holder, in six
per cent government stock; or let Treasury
notes be issued, with small per centage of
interest to be paid semi-annually; and let o
comprehensive system Of taxation be adopted
to pay the interest and create q sinking fund
for the redemption of the principal.
BY thus establishing proper system of
credit, and keeping the control of the cur
rency In Its own hands, the government
will prevent depreciation, just as the English
government did in the case of the Bank of Eng.
land during the war with France. Up till 1910
the notes were within two or three per cent of
par. In that year, and in succeeding years, the
issues became so excessive that in August of
1914 the depreciation was twenty-five per cent
Peace was then established, and, though at the
end of the year the notes of the bank in circu-
lation amounted to a2s, ,232, ,73O, or upwards of
one hundred and forty millions Of dollars, yet
the depreciation was only 80 los. Cd.
or less than ten per cent This was
owing partly to the diminished circula-
ton Of the notes Of country bankers.
and the fact Of commerce flowing once
moro IN ~ seoustonsd ehsaasls aad gold