The Burlington weekly hawk-eye. [volume] (Burlington [Iowa]) 1860-1876, 1863-10-31


And what Liberty makes us all Nations shall he;
For the land now DER which that proud flag is
Atthat moment becomes the blesthome of the
free. TCincinnatt Gazette
National Banks.
Some weeks since we printed an article
cial policy, since which our attention has
been called to published letter from Hon.
Robert s. Walker, formerly Cabinet Off
Ger filling the same position. This letter
explains the workings of the new National
Bank system so fully that we gladly give
1T place in our columns for the special
benefit of our readers-particularlyc CAPT
talists, financiers, and all business men. 1t
is worthy of q careful perusal.
The great features of the system of Mr..
Chase Says Mr.. Walker) are:
l. A loan to the Government upon its
bonds, -eimbursable in twenty years, but
redeemable after five years, at the option
OF the nation, the interest being six per
cent, payable semi-annually in coin, as is
also the principal.
2. The issue of United States legal ten
der notes, receivable for all dues to the ma
ton except customs, and fundable in this
United States $50 six per cent stock.
3. The authorization Of the banks re-
commended in his report, whose circula-
ton would be secured not only by private
capital but by adequate deposits of United
States stock with the Government.
4. To maintain in the meantime as near
to specie as practicable this Federal cur
rency-frst, by making it receivable in all
dues to the Government except for GUS
toms; second, by the privilege of funding
it in United States stock; third, by enhan
cling the benefit of this privilege, not only
by making the stock, both principal and
III IL,
it gradually the ultimate basis of our whole
bank circulation, which, as shown by the
Census Tables before referred to- includ-
ing deposlts,) nearly double every decade.
5. By imposing such a tax on the circu-
lation of the State Banks as, together with
State or municipal taxes, would induce
them to transfer their capital to the new
banks proposed by the Secretary.
6. To relieve the 7,eto banks from all State
or municipal taxation.
7. In lieu thereof to impose moderate
Federal tax on all bank circulation, as a
bonus to be paid cheerfully by these banks
for the great privilege of furnishing ulti-
mately the whole paper currency of the
country, and the other advantages secured
by these bills. -.... ...
This tax, as proposed by the Secretary,
was one per cent semi-annually, which, az
effect would have reduced the interest on
our principal loans from six to four per
cent per annum, so far as those loans were
made the basis Of bank circulation. Con-
gress, however, fixed this tax at about one
half, thus making the interest on such
loans equivalent in fact to five per cent per
annum, so far as such loans, at the option
of the holder, are made the basis of bank
ing and of bank circulation. This is a
privilege which gives great additional val
ue to these loans, for the right to issue the
bank, paper circulation Of the country free
from State or municipal taxes is worth far
| more than one-half per cent semi-annual-
ly, to be paid on such circulation. That
this privilege is worth more than the Fed
eral tax, is proved by the fact that many
banks are already being organized under
this system, and by the further fact, that
more than 500, OO0, 900 of legal tenders have
already been funded in this stock, and the
process continues at the rate of from one
to two millions of dollars a day. 1t will
be observed that the holders of such bonds
can keep them, If they please, disconnected
with all banks, receiving the principal at
maturity, as well as the seml-annual inter-
est in gold, free from all taxes. g..ts -
This system has been attended with COM
plete success, and notwithstanding the IN
crease of our debt, the premium on gold for
our Federal currency, fundable in this
stock, has fallen from 70 per cent. in Feb
ruary last, before the adoption of Mr..
and before the Both of June next, it is not
doubted that this premium must disappear.
No loyal American doubts the complete
suppression of the rebellion before that
date. in which event our Federal currency
! will rise at once to the par of gold. In the
meantime, however, gold is at premium
q per cent, which is the least profit gin
dependent Of future advance above par so
soon to be realized by those purchasing
this currency now, and waiting its appre-
citation. or investing it in our United States
| $40 six per cent. stock. s.. T..
But. besides the financial benefits TO the
Government Of Mr.. Chase's system, its
| other advantages are great indeed. 1t will
ultimately displace our whole state bank
system and circulation, and give US mg-
| tiondL Currency, based on ample private
capital and Federal stocks, currency OF
| uniform value throughout the country, and
ALWAYS certainly convertible on demand
into corn. Besides, by displacing the state
bank circulation, the whole bank-note cur
| rency of the Union will be based on the
stocks of the Government. and give to eve
ry citizen who holds the bonds or the cur
rency (Which will embrace the whole COM
munity in every state) direct interest in
| the maintenance of the Union. -
The annual losses which our people sus-
! tain under the separate state bank system,
| in the rate of exchange, is enormous,
whilst the constant and ever-rcurring in
| solvency of 80 many of these institutions,
ccompanied by eightgeneral bank suspen-
sions of specie payment, have from time to
time spread ruin and devastation thr'o-
out the country. I believe that, in peri
cd of twenty years, the saving to the peo-
pie of the United States, by the substitution
of the new system, would reach sum
very nearly approaching the total
amount of our public debt, and IN time
largely exceeding it. As question, then,
of national unity, believe the gain 70 inc
country in time by the Adoption OF .he
new system will far exceed the COST OF
the war. 1t was tho state oank system
sion mainly the sinews of war. These
banks are now generally insolvent, bnt II
the banking system now proposed haa
been in existence, and the circulating me
dunn in all the states had been an UNI
form national currency based entirely on
stocks of the United States, the rebellion
corld never have occurred. Every bank
and all it's stockholders, and all the holders
of the stock and notes of all the banks
embracing our whole paper currency.
would have been united to the Govern
ment by an interest 80 direct and universal