The evening telegraph. [volume] (Philadelphia [Pa.]) 1864-1918, 1869-12-06

bank ia solvent and IN good faith endeavoring to
close UP ts affairs, The most OF ts creditors would
80 that, suppOsiEg the duidator TO have progressed
20 far that the bank ready distribute its capital
ner in which the liquidation shall be completed, and
the shareholders discharged from all further liability
able time.
It s respectfully recommended that Congress
snOull pass an act I'm one section, unconnected with
I any other subject requiring all banks that go In
nqudatiOn to deposit legal-tender notes for their
deposited with the Treasurer the United States
Us security for such circulation, within sixty days
from e date OF the vote OF the shareholders TO go
into LIQUIDATION.
lMethOd of Collecting United States Taxes.
Section ii OF the national banking law provides for
taxing the circulation, deposits and capital not in
The banks required to report and pay these taxes
sem-annuay to the Treasurer of the United States.
'Ihis they have done regularly since their organza-
tion, paying the Treasury several millions every year,
without trouble, and without expense to the Gov
eminent. ..
Under the internal revenue law they are required
TO pay special tax and dividend tax TO the coec-
tors OF the several districts ia which they located.
1t is recommended that all taxes imposed
tonal banks by the United States be made reurnabe
and payable to the Treasurer of the United States,
IN the same manner that the larger portion OF them
now are. - q LII. -.--. ......l.r 1r.-
This change would avoid confusion save expense
and trouble, collect the taxes more promptly aud
probably more thoroughly, and place the whole
which means also, ali information on the subject
accessible. r-- t.-.. t-
c vi. Sound Currency.
The currency constitutes very important part OF
the financial sytem of any country Without sound
currency, healthy financial condition is impossible
Ihere are Two requisites to sound currency-con-
vertibility and elastcity-and either OF the two n-
wolves the other. The present currency OF the
United States possesses neither OF these requisites.
During the past year it has neither Increased nor
diminished, but stands about as it did this time last
year-s390, 100000 issued by the Government and
$500 900 issued by the baaks-nelther redeemabe
nor convertible into anything more valuable, and
therefore not susceptible Of reduction by any ordi-
nary process; each issued to the full limit allowed
by law, with no power OF expansion. The
whole amount mnst be employed, whether 1t
is wanted or not, and the limit cannot be
exceeded, no matter how urgently more may be re-
quired During the summer months, when there is
rest in almost all branches OF trade the whole circu
lation was in market seeking employment; and now
that autumn has come, with its bouneous harvests,
when the farmer seeks to realize in money the re-
ward of his labor and the interest Of his capital for
the whole year, when hundreds OF millions must be
distributed throughout the length and breadth of the
land we have the same unvaTying amount OF cur
There are two kinds of currency in use one issued
directly by the Government the other issued by the
banks. One kind would seem to be enough The
best should be preserved and perfected; the other
Applying the test first to the Government issues,
1t is noted at once that they are not redeemable and
that provision has ever been made for that pur-
pose The very moment they are made redeemable,
they will to answer the purposes Of currency
for after they are redeemed they are in the treasury
and cannot again be paid out, except upon appro-
priatiOns made by law in accordance with the con-
be put in circulation, except as disbursements may
be necessary to pay expenses and debts OF the Gov
eminent. SO that Government circulation is not
convertible, and therefore is not elastic and cannot
be made SO without first making a radical change in
the organization OF the United States treasury, by
which 1t should be converted into huge banking
institution calculated to receive deposits, make
loans, and otherwise perform the functions of
national bank.
The notes issued hv national banks are ncIninally
redeemabe and, II the leea-tcnder notes were out
OF the way, would be actually So and being issued
tract and expand IN obedience to the law OF supply
and demand, so that they would also possess the
AS to the comparative merits of the two
kinds OF currency, an an impartial @ consideration
circulation, principally because It would pos
sess the power Of adapttngN itself to the
made TO possess the same power of adaptation, the
verdict would be in their favor. candid investga-
ton, however, cannot fail to develop the fact that
there is no branch Of the fiscal sesvlce adequate to
the direct issue and care of such currency as the
country requires. The treasury system is SO arbi-
trary in its collections and disbursements, little in
harmony with the business interests OF the COM
munty, that it frequently absorbs large amounts OF
currency at most nopportune seasons, and dis
burses them with just as little regard TO the wants OF
large amounts would be presented for payment
when money was plenty; but, as the return OF this
money to the channels OF trade would depend upon
the disbursements OF the Government there
could be no certainty that 1t would find its way
back again when needed In fact, the current
are regarded by business men as constituting
a powerful, and at the same time very
uncertain element, difficult to estimate, but
which must necessarily be taken into consideration
in all their business transactions 1t is but justice,
however, to say that the Inconvenience and defects
inherent in the present system have been ebviated
as far possible by the present administration OF
the department, and where they could not be obvi-
ated entirely, they have been reduced to mini
mum.
SO long, therefore, the collection OF the revenues
is liable TO be process OF imitation, the agencies
through which collections and disbursements are
effected cannot be regarded as suitable agencies for
furnishing a sound currency to the people,
The argument that the Government should furnish
the currency in order that it may realize the profit
upon its circulation Is common one, but will not
bear scrutiny. There is no profit to the Government
on the circulation OF an inferior currency. Only
sound currency will promote the material prosperity
of the people; and the Government can realize no
AS a currency, therefore, Government issues are not
profitable. AS loan without interest they
equally Improbable because they are inuri0u to the
national credit and add enormously to the expenses
OF the Government.
II, however, It is impossible for the Government
to comply with the conditions necessary in order to
furnish sound currency 1t at least provide for
the withdrawal OF its own notes, and prescribe the
conditions upon which, and the agencies through
which, better currency may be provided. As before
stated there should be but paper currency in the
country and that should emanate from source that
is influenced by and is amenabe to the laws OF trade
No check or limitation should be imposed upon 1t
other than the law OF supply and demand.
Free Banking.
The banking system now in operation under the
act OF Congress is doubtless an improvement upon
the condition of things that prevailed prior TO ts in
auguTatlon. 1t may have mperiectiyns, but most OF
them can be traced TO the evils of an irredeemable
currency. Abuses of various kinds practised,
tolerated. during a suspension OF specie payments
that would disappear OF Themselves in a healthier
financial atmosphere and as observation and expert