The Wheeling daily register. [volume] (Wheeling, W. Va.) 1864-1878, 1868-01-07

which we pledged ourselves for single
lday longer than good pleasure and dis,
cretion of the Congress of the United
States thought best to allow this bank
currency to exist. What effect would
it have upon the banks? Those depen'
dent wholly upon their circulation,
which are not in fact banks of loans
and deposits, would wind up, and their
managers would seek some other and
equally honest employment. Banks
that are needed would still be banks OF
loan and discount, but not of circula-
tion.
1t is said that the banks furnish now
the best currency this country ever saw,
because it is the same in New Orleans,
Boston, New York, and Chicago. But
what is the currencyi 1t is the notes
of the bank. What makes them equal
all over this countryi 1t is the In
dorsement of the United States. SO
that we have come into this very re-
markable position, that when bank
breaks its currency is better than when
it was solvent and sells at slight pre-
MUM. Therefore, as the United States
is primarily responsible for all the cir,
cuiation, we ought to supply the cur
rency to the people and receive the
profit of doing it.
But it is said that the banks cost the
United States nothing. One Of the
ablest bankers of them all, Mr.. Jay
Cooke, has undertaken to tell us that
the banks pay in taxes large amount
and therefore in equity We ought not
to disturb them. Sir, if Mr.. Jay Cooke,
or any ono else will tell ME of any bust
ness in this country that is not taxed
or that does not pay a large amount of
taxes, then l will agree that the banks
are not favored. Take for example, a
manufacturer. Take single case, only
two years ago, in the State of Massa-
chusetts, of manufacturing corpora
tion of S740,000 capital and of Sl6O, O,OOO,-
900 ANIMAL product of manufactured
goods. 1t exactly divided profits with
the United States. Its stockholders
received two dividends of five
per cent. each on 100000,
and it paid five per cent. tax on the en-
tire amount of production, 81 500, 900;
so that they in fact took the United
States into partnership, only the United
States got all the profits, but the stock
holders bore all the loss. Now, if there
is any greater or more onerous burden
of taxes on the banks than that, / have
yet to learn where it is.
Again, it is said that this banking
system is better one than we ever had.
And it is said, further, that if We do not
encourage it we shall go back to the old
State bank system. Ne, Mr.. Chairman,
never, never! The day of State banks
has gone by. They were always, in my
poor judgment, unconstitutional; but
they got themselves fastened upon the
country, and there was never power
enough, until the necessities of the coun-
try required new system of finance,
to break off their hold. We have rid
the country of them, and the Congress
of the United States, ay, and the good
Judgment of the people, will never per-
init that system again to be imposed
upon the country.
What is the next proposition Why,
it is said we must not interfere with the
national banks because they patrioti-
cally helped us during the war. Upon
that / take issue with each and every
advocate of the banks. On the con-
trary, they helped themselves, not us.
1t is said they loaned money to the Gov
ernment. How did they do itf Let
me state the way national bank got
itself into existence in New England
during the war, when gold was
200, and fve.twenties were at
par, in currency, or nearly that.
A company of men got together $780,
900 in national bank bills, and went to
the Register of the Treasury with gold
at 300 and bought United States five
twenty bonds at par. They stepped in
to the Office of the Comptroller of the
Currency and asked to be established as
a national bank, and received from him
S270,000 in currency, without interest,
upon pledging these bonds of the
United States they had just bought with
their S3O0,0OO of the same kind
of money. Now, let us balance the
books, and how does the account stand 7
Why, the United States Government re-
ceives $50, 200 III national bank bills
more from the banks than it gave them in
bills; in other words, it borrowed of the
bank $50, 900 in currency, for which, in
fact, it paid SIS, 900 year in gold inter-
est, equal to $50, 900 in currency, for the
use of this $50, 900. Let me repeat. The
difference between what the United
States received and paid out was only
$50, 900, and for the use of that the Gov
ernment pay on the bonds deposited by
the company, bought with the same
kind of money, $4,000 q year interest
in gold, equal to $4,000 in currency.
But the thing did not stop there. The
gentlemen were shrewd tinanclers; their
bank was a good one; they went to the
Secretary of the Treasury and said {:
Let our bank he made public depOsi-
tory" Very we'll; it was good bank;
the managers were good men; there was
no objection to the bank. 1t was made
public depository, and thereupon tho
cOmmissaries, the quartermasters, the
medical director and purveyor, and the
paymasters were all directed to deposit
their public funds in this bank. Very
soon the bank found that they had a
line of steady deposits belonging to the
| Government of about million dollars,
and that the S270 900 they had received
from the Comptroller of the Currency
would substantially carry on their daily
business, and as the Government gives
three days on all its drafts if the bank
was pressed it was easy enough to 60
on the street if they had good security.
They took the million OF Government
money so deposited with them and
loaned it to the Governments own
bonds, and received therefor 100000
moro interest in gold for the loan to the
Government of its own money, which
in currency was equal to $4,000. So
that when we come finally to balance
the books the Government is paying
S156, 900 q year for the loan of $4,000.
And this is the system which is to be
fastened forever on the country as a
means of furnishing circulating me-
dunn
This, only using round numbers for
the purpose of illustration, is an actual
and not n feigned occurrence. You will
see it was a perfectly safe operation for
the banks, though not q very profitable
one for the Government, because they
held ample security for the Government
deposits in its own bonds. But the diff
ficulty is the Government was paying
interest all the while on its own depos-
its; and this state of facts is only rem
dered possible by this system of supply
- Il.