The New York herald., 1870-04-22
NATIONAL EiARS AND spEls PAYMENTS.

Another Letter fram United States Treasurer
Spjnner-F Causes ct Non-ResumpfiOn
CT Specie Payments.
Tie follo wing is copy OF letter from Treasurer
Spinner upon national banks ana specie payments
addressed 10 II. b. Wns0n oil New York;
TREASURY OF THE UNITED STATES
WASHINGTON, Aprii Is, 1870.
DEAR SIR--I read your Two pamphlets. to winch
you called my attention by your letter OF The I'm
InSG VIA good deaf oil Interest rney contain
much valuable information aau many Suggestions
AS the advocate oil an exclusive ISSUE Of
United States notes ana the opponent
OF all national Danas you Under
great obligations 10 managers OF mauy OF these
BANKS. Ihey certainty unNltIngly piayiu.s
directly into your hands. You speaS OF the arro-
aaGce ol the banks. You can scarcely believe The
extent 10 which some o them eNhlbd a case
has lately COME 10 NY notice where board OF bauk
directors passed rcsolujlons ana sent copy OF The
proceedings TO the member OF Coaeress rom the
district In which their Da9k Is located, instructng
HIM TO oppose the Funding bill
have some nNed maXims IN regard to govern
lnenlS. one Is tnat o government has no business
TO do business. Az ! have conslGeied tue issuing
OF paper money KIND OF BANKING business,
ana ieeing Jealousy that tne government
might aDise the powers OF great nioneyed
corporation, have therefore preferred the pan OF
having the currency ot tue country supplied by the
nanoua BANKS ! nave believed thar SO great a
nuihoer o! these institutions could not act In con-
cert FOR evil aud tnat they wouu therefore not be
dangerous to our institutions as single machine,
managed perhaps as pOlitical power ana lor poti
Cal purposes by the gov yernment, single banking
institution like the latc Bank OF the Uniled STATES;
altitude OF these banks nave gone long way towards
satisfying me. as IL mas, no doubt, many THOUSAND
after all be Tor the best Interests OF the people
1 Eotice tnaC you state some errors taat are in
favor OF rhe banks and Ihat do not stren hen your
argument In your iirSC pamphlet, nedr the bottom
oI page fourteen, You say our national banks
owe tner prestige manly TO the circumstance that
tnelr currency mas quiiiled government endOlsa-
tlon III the United states securities lodged IN the
| oiice OF the Comptroller or the currency" NOV.
the tact 49, tnat tue securities are loaIed in this
| entlOfSllIOl Y d Al
uutea states Is reauIre Dy law to redeem the notes
| CT national pank tnaJ may fail ana 1t rs inmate
| ral whether the securities lodged Wlth him Or the
pnfpose are sunlcieps or not. II tnefe L, oss,
10 the United States, an0 not 10 the bl.laol6er.
| In THIS respect the National Banking law
| differs from tne Banking law OF .ne Sale
| tional bank TO redcem its circulating notes,
the treasurer OF the United states vrEualy becomes
the cashier OF such bank, Iar at least,
dempuon OF It's circulating notes concerned
| Tue notes OF broken national banks are worth
converted into greenoacks, while good Dank
notes cannot be 80 converted. Ihis TACT
IS what row B., prevents prevents the resumption Of
any time arrange matters to abe
TO resume in ninety DAYS were 1t not for It's endorse
nent OF the national panx notes. But the banks
are not prepared, and they manifest diSD0stion
10 prepare themselves for an honest resumption O.!
specie payments. should the government resume
under circumstances and the banks refuse TO
do the effect would be 10 throw tle redemption
OF ali the circulating notes or tue banks so
refusing upon TINS ohice such load at sucb u
time would proDably be too neavy l0r tie govern
ment to carry ano relapse would follow. 30 you
the banks have II IN Their power To prevent
sumption. Iney Will prooaoiy so prevent until they
sna deem II tneir interest 10 permit or until tuey
Shall be forced INTO it by an act OF Congress.
Having these facts In view, l nave, therefore,,
favored ths passage OF law to compel The banks TO
be prepared Tor resumption on day fixed In the
| Iuture. Without some such enactment 1 lear the
day OF resumption OF specie payments Is further
OIL tnan you ana would wish 1t TO lie, unless Jour
project oil withdrawing all the national bank
RON circulation aud replacing tnem wlth United
states notes succeeds. AT page ~ you say Our
legal measure gold, and PRIOR the war
the TWO kinds Of cOlus were at par regards each
other. Silver coin oeing now ut discount when
measured by golc IL evidence that lis supply In
market IL greater taan me supply OF god wnat
woul0 produce the same eieci, the foreign demand
gold has been greater tnan tat Tor slver hence
the relative difference In their market vaiuen You
to nave overlooked tie fact that gold and Sill
yer are bou legal tender In the United States. SO
lar aS know our country Is the only tnat per-
sIsts N maintaining q dual standard OF values. In
other countries either gold or silver is the legal
standard, ana they nave changed from the one 10
| the other In our country our silver STANDARD
was below the value liked III commerce. The
consequence was That our silver lett our
gnores ana went 60 foreign countries. Congress,
instead Of I1akng god tue lepa standard kept up
the double standard, ana Oh February Il, 1853
passed reducing the silver hall dollar from 2Os
grains TO l92 grams, and all me lower denomina.
tons OF the SILVER dollar IN tue same ratio. All this
fractional CON was however, declared to be q legal
tender only for amounts under five dollars. The
silver dollar asserts Itself to-day. 1t cannot be
bought at par with a gold dollar. The fractional
parts ol the silver dollar coined before 1853 sr
worth more than their nominal equivaent Ill gold.
The reason why the fractional parts OF dollar are
not at par with gold dollar Is therefore. because
the two hall silver dol ars OF recent coinages are
| about seven per cent short OF silver dollar OF the
fractional part OF silver dollar coined before 1885,
and not because the supply In our market Is greater
tnan the supply or gold.
Your argument near the top of page fourteen OF
| your second pamphlet has failed 30 convince ae,
because The cases, as stated by you not anaa-
| gous. You there say:-"Tne allegation that tue
issue and management or O national currency opens
the door for fraud or party abuse appies with ex-
actly the same force to the coinage and management
or gold and silver currency" You ignore the fact
lintrinscay worth nearly as much as the
nominal value or the coin, and that the bullion
for rs coinage must be bought at TINS high price,
while paper money OF the came nominal value
has little intrinsic value, and can be produced
in vast amounts &C very little cost. The cases
| of the Issuing OF gold and silver currency and one
OF paper by the government therefore bear In your
Illustration OF tine subject very little, if any, ana
logy TO eacn other. But II you by your arguments
have falled to convince the banks oil their .con-
sidered course OF conduct, may succeed In con:
vincing me and the great OF our people as well
II you y:-ihen national bank currency IS better
and safer thsn the old and fraudulent system whica
IL superseded because II derives certain amount OF
security from the government bonds deposited with
the Comptroller OF the Currency.n / have al
ready NOTICED your mistake In thus In
pamphlet, but ut the risk OF repeating what said
before would state that the bonds held In this
onice to secure the prompt payment and redemption
OF the circulating notes OF the national banks are
not held to pay such notes of broken bank when
presented for payment from the avais Of sale OF
the bonds, but to demnfy the United States for re-
deemng such notes. The notes must be redeemed
by the United States Treasurer at once, whenever
presented for payment, whether the security held
for their redemption sufficient or not. The secu-
rty IS not, therefore. as you seem to suppose, a
certain amount, but Is perfect for the whole
amount. Tue government has undertaken TO pay
the notes OF all defanlting national banks on the
| same terms that 1t rcdeems its notes. In other
: words, toe government guarantees that ITS Sax