The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1868-12-09

TUT w Ut department.. 7o,0OO,OUO
For Navy Department $500. 10000, 900
For interest on public debt. 12S,0oO,o0o
Expenditures. Observation-Disclosures. s3o3, 600 600
The accompanying report OF the Commissioner OF
Internal Revenue gives the necessary Information in
regard to the Bureau, and contains many very in
dlcious recommendations and suggestions which arc
worthy the careful consideration of Congress.
The internal branch OF the revenue service is the
Tne Wc Iae people iee sae interest,"
although paid eventually by the consumers they
lelt only by The great mass Of the people in the in
creased cost OF the articles consumed. Not with
the internal taxes. These collected in every part
of the Union; and their burdens fan, to large ex-
tent, directly upon the taxpayers Assessors, col.
lecfors, inspectors, detectve5-necesSary instru-
mens IN the collection OF the revenues-are found In
every part Of the country. There Is no village or
rural district where their faces are not seen and
where collections are not made. The eyes OF the
whole people are therefore directed TO this SYSTEM
AND IL IS OF the greatest importance that lis adminis
tration should be such to entitle 1t to public re-
spect: uniortuna ely this is not the case Its de-
moraiization Is admtted and the question arises
where 10 the remedyY The Secretary Is OF the opinion
tnat 10 10 be found In such amendments to the act
Is viii equaze the burdens OF taxation, ana in an
elevation Of the standard OF qualification for revenue
Offices.
Upon the subject OF internal taxes the Secretary
nas areaay spSSen IN regard TO the character OF
must be decided change for the better In this re-
spect II the system Is to be rescued from its democrat
ized condition. After careful reflection the Score.
tary has come to the conclusion that this change
would follow the passage OF the bill reported by Mr.
ment and Reform, on the 14th OF May last emitted
"a bin 10 regulate the civil service and promote the
efficiency thereof." The Secretary gives to this bin
his hearty approval and refers to the speech which
was made, upon its introduction, by the gentleman
who reported it, Tor an able and lucid exposition Of
Its provisions and for truthful and graphic descrip-
ton OF the evils Of the present system OF appoint
ments to Office.
regular quarterly reports, the number Of national
banks was l,644, seventeen OF which were In volun-
tary liquidation.
Thcfr capitn, xvoo A.oo
m ri DISCO 655.sI527
Their circulation. 295, 1884, 244
Ancir ucpOStS. 60i, S3O,278
In no other country was SO large capital ever in
vested IN banking under single system as Is now
invested In the national banks; never before were
the interests OF people 80 interviewer with sys-
tenn OF banking the interests Of the people OF
the United States with their national banking system.
~ not strange, therefore, that the condition and
management OF the national banks should be. to
then and to their representatives. matter OF the
deepest concern. That tho national banking system
perfect one Is not asserted by its frends that IL
very decided Improvement as far as is
regarded upon the systems which 1t has superseded
must be admitted by II opponents Before 1t was
estaonshe1 the several States whether in conform
NY with the constitution or not-jonty with the
general government, during the existence OF the
charter OF the United States Bank and soley after the
expiration Of that charter-exercised the power Of
issuing bills OF credit, in the form OF bank notes.
through institutions of their own creation and thus
controlled the paper money, and thereby in no
small degree, the business and commerce OF the
county. In May, 1888, when the National Currency
Bureau was established in Washington, some 1900
banks oraanized under State laws, furnished the
people Of the United states with q bank note cur
PEELED to PROFESSIONALLY at least-the holders OF
their notes against loss by deposits Of securities
capital Of the banks-that. capital being wholly
under the control OF their managers
q their no IN there se was no m %
the amount Of notes that might be issued II
anV Go s m their =,
capital In others, while notes could be Issued only
IN certain proportions to capital there was no re-
organized. The notes OF Q few banks being payable
or redeemable ut commercial centres, were current
In OF the States while the notes Of other banks
perhaps just as solvent were uncurrent beyond the
limits Of the states by whose authority they were
Issued. How valueless were the notes OF many OF
the state banks Ii still keenly remembered by the
thousands who suffered by their insolvency. The
direct losses sustained by the people by an unsecured
country resulting from deranged exchanges,
caused by local currency constantly subject 10 the
nnsuitsbIeaess Of such currency to the circum.
stances OF the country can be counted by millions.
y only necessary to compare the circulation Of the
State banks with that furnished by the national
banks to vindicate the superiority OF the present
system. Under the national banking system, the
government which authorizes the issue Of bank
notes and compels the people to receive them as
money assumes its Just responsibility and guaran-
caly distinguishes It from others and gives TO It its
The object Of the Secretary however, in referring
20 the Satonal banks Is not to extol them but TO call
the attention OF Congress to the accompanying in
strucve report OF the Comptroller Of the Currency
especially 10 that part OF which exhibits the condi
ton and management OF the banks In the CONNER
cial metropolis and to the amendments proposed by
ON the 5th day Of October last the loans or dis.
counts Of the banks In the city OF New York amounted
TO slo3, only $780, 100000 OF which consisted
OF commerce al paper, the balance being chiefly made
mp Of what are known as loans on CALL that say,
OF loans on coatcrals, subject to be called in at the
pleasure OF the banks. Merchants or manufacturers
Ia
understood that these loans are confined mainly To
persons dealing, or rather speculating In stocks
coin. This statement shows TO what extent the busl-
ness OF the banks In New York has been diverted
rom legitimate channe.s and how deeply involved
the panHs have become IN the uncertain and danger
The deposits OF these institutions on the day men,
81 a1 cas n sms
were In iact manly certified checks which had been
passed TO the credit OF dep0sit0rs, and constituted
banks always deduct such checks from their deposits
In max ny up their statement for the payment OF In
terest and tier estimates for reserves II Is under
stood to be the practice OF number OF the banks
perhaps the pructce exists to a limited extent In
ALL to certify the checks OF their customers in adj.
vance OF the deposits out Of which they are expected
TO be paid Ia other words, to certify checks To he
good, under an agreement between the banks and
tho III awes, that the money to protect them shall DO.
deposited during the day, or mt least before the
checks, which 20 through the clearing honso can be
presented for pay inent The Secretary has learned
with great surprise that O number of banks-gen-
orally regarded as being under judicous manage
ment-ceitliy an single day the checks OF stock and
gold brokers to many times the amount OF their
capitals, with no money actually on deposit for
the protection OF the checks at the time Of their
certidcation. more dangerous practice, or Que
more inconsistent with prudent, not To say honest
banking, cannot be conceived. IL IL unauthorized
by the act, and should be prohibited by severe
penalties. Aside from the risk incurred by this
reckless method OF banking the effect OF such prac.
tees Is to foster speculation by creating imitation.
1t e, In fact, part parcel OF that fictitious credit
which Is 30 Injurious to the regular business OF tho
city and to the business OF all parts OF the country
which feel ana anected by the pulsatons Of tie
commercial centre. II Is tins very dangerous prac-
ucc combined with the more general practice OF
making loans "on call y which leads TO unsafe ex.
tensions OF credits aud makes many Of the banks
IN New YORK helpless when the money market ~
stringent tan anything be more discredablc to
the banks OF The great emporium OF the country
adord more conclusive evidence OF their impruient
management than The tact that. with a capita-in-
cndinr Their surplus and their undivided profts-or
S1OO 600 0oO the Withdrawal from circulation OF ten