Green-Mountain freeman. [volume] (Montpelier, Vt.) 1844-1884, 1868-01-01
National Bank Notes and Legal Tend

'hc Oh the propositions recently suggested
as n help to the nited States treasury was
the issuing Of greenbacks to replace
the DOtes Of the national banks. now amount
ing % three hundred millions Of dollars and
II Is urged that the government bv king this
step would save the interest on this three
hundred millions, amounting to eighteen
millions annually in gold or about twenty
Tour millions IN Currency. a. rnld noyy sells
Secretary McCulIoch Mr.. Hulburd the
comptroller Of the currency, and various
other official and unofficial personases oppose
TINS giving various reasons for that opposi-
fion- Senator Morrill,. Of this State, in his
speech recently, argued very earnestly
against this project IF taking from the nation
al banks their power to issue notes and we
copy elsewhere that portion of his remarks.
We confess. however,. that c are unable 10
see Mr. Hulburd's figures in so favora lie a.
light for the argument rs Mr. Morrill, seems
10.
The Comptroller method OF figuring the
taxes il wrong in the first instance The
hanks pay To the government Il tax Of one
per cent ON their circulation, which, for all
the banks. amounts to three millions of dol
lars. The banks are also required to keep
sum equal to fifteen per cent. Of their cir
culation on hand in legal tenders. which
amounts TO forty-five millions Of dollars and
ak per cent interest on that is 50 200 COO.
Perhaps the government gets one million of
dollars more from the banks as the FIVE per
cent tax the profits which the banks
make out of their circulation. These, then.
are about the figures
One per cent. on circulation, - ,UOO, OUO
Six per cent. on legal tender re-
serve to secure circulation, Zoo 900
Five per cent. on profits OF circu-
iatIon- 900 900
The banks thus pay the government less
than seven millions of dollars for the priyi-
lego of issuing three hundred millions of
their own notes and the government would
save, by replacing these notes with green
backs, at least eleven millions of dollars
annually
Mr.. Hulburd's statement that the banks
''loan the government the bonds which
they deposit security for their circulation
is simply absurd, the government pays
the banks precisely the same interest on
these bonds as on similar bonds held by the
banks at home and this statement of the
Comptroller exposes the essential unfarness
of his argument. He is making plea for
the banks. and disingenuous one at that,
and we are somewhat surprised that Mr.. Nor
rill while feeling compelled to correct an error
Of nearly eight millions Of dollars in the
statement should have given it any credit
whatever.
To show again how preposterous Mr.. HUI
burd's statement is, let follow out his
style of reasoning. He says the banks loan
the government $3.50. 100000 at three
fourths of one per cent. per annum. But
MIR. H. might have said g if the banks had
not loaned this money to the government
they might have made as much as seven and
tbrce-fourths per cent on it, or seven per
cent. more than they actually receive; there
fore these banks give that seven per cent. te
the government. Seven per cent on $780,
OOO, 900 is :s34 300 900, which the banks
actually lose the chance of making by this
business of banking We submit that these
MIR. Hulburd gives; in fact they are the log
ical result of his figures.
Whether. on the whole, it would be better
financially for the government and the coun-
trv To replace the national bank currency
with grecnbacks is, very likely. an oper
question, but the opponents of the measur,
will not, in the long run, help their case b,
tricks of figures like those the Comptrolle
resorts to. Ii is said that figures will no
lie, but Mr.. Hulburd's certainly produce ex
traordinary results, when they lead to thu
conclusion that the banks patriots
and public-spirited that they loan the gov
ernment S49O, 600 900 at three-fourths o
one per cent. interest. As they have mad
mouey even at this rate, couldn't Mr.. HUI
burd persuade them to loan two thousan'
millions more Mt the same rate?