The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1871-05-14
A PROPOSED NATIONAL EXCHEQUER.

To THE EDITOR OF THE HERALD
Ibeg to submit to the HERALD a brief synopsis,
with some considerations on the same, OF proposed
bin for National Exchequer which has received the
approval OF many eminent merchants as the best
way Of meeting the changes Of which there are
many portents on the financial horlzon:--1. There
Shall be an impost capital OF $780, 900, divided
into shares OF $1,000 each to be contributed one
quarter coin and reequarters In legal tenders.
g. The institution to be divided into two depart
mens-one for the issue Of Exchequer notes. covered
by q deposit of coin and government bonds IN the
proportion of one in coin to three in government
bonds up two hundred millions, then one in coin
to two in government bonds forstwo hundred mil
lions more, and then one in coin to onein govern
ment bonds for two hundred millions more. The
Issue Department to be under the control OF three
Commissioners at each office, appointed by the
President one by the Governor OF the state and
by the proprietors Of the Exchequer The other de-
partment for banking Its discounts being limited 70
twice its capital and the rate OF interest limited
to SIX per cent. 3. The capital TO be dstrl
buted equally, IN proportion to population, to
Office or the ExChequer to be In the city OF New
York. 8. The government to keep its accounts with
banks allowed. under certain conditions TO sub
scribe the whole or any part OF Their capital to the
Exchequer. 7. governor OF the EXchequer TO be
annually elected by the directory. s. Limitation OF
powers and definition OF functions OF the National
giving STABILITY TO the business and currency OF the
nation.
that the proposition OF the first magnitude. A
great and thrifty people like the population or the
United states should nave currency converriole as
necessity OF the country Is capital. radical deiecJ
in the present system OF banking y IN IT'S failure ex
nlsh any Increase OF the Oanabe capital or credit OF
the nation. Take for example. any village where
there are few merchants and but little IDLE money
and there establish bank of 100000 capital. The
government bonds $1l 900 and 500 900 OF notes
only can be Issued for the use OF the community.
Here we have q clear dminution OF the oanable
capital. while the propretors OF the bank draw six
per cent in coin on $lo9 600 ana whatever they make
defect In the present system Is fatal to It's usefulness
but another defect exists In the danger to govern
specie payments. II the legal tenders were
Withdrawn the whole structure would tumble as the
not com the v Of NeW
great evil is the sub -Treasury-the deformed OFF,
spring OF the pet banks-and their failure In
1887. The government holds now idle rs IL has
done In the past more than one hundred millions in
coin ana greenbacks, totally Withdrawn from the
channels OF trade and, IN itself, poor investment
In an active ana growing country. National Ex-
chequer would grasp all these matters and lend, as
sumption Of specie payments, would increase the
loanabe capital OF the country by Two hundred MIL
lions and would equalize the distribution OF banking
capital
The same ideas have not vet been submitted In
any practical shape, ana now that they are 80 sub
u
chants OF New York that some or their number place
themselves at the head Of such an institution and
bank bank VIII ind in the Exchequer powerful aux.
iIary would settle all fears as 10 tue course or
government; would leave the banks free to use their
own capital, ana should they need more money
would ne always ut hand to discount their bills
cevable, at not over SIX per cent per annum.
besides allowing them to retire any portion OF
their circulation which may reach the Exche-
quer from the government or other deposi.
tories, by transferring their negotiable notes
notes. In other words, the transition from an ire
deemabe paper currency to one rcdecmable IN
coin would be easy and natural, since the agent
which would bring about this result could have
only one object view-viz., TO protect itself and
prosperous; the government holding, through It's
commissioner funds to meet all issues OF the ex-
change limited no public or private interest could be
damaged.
The division OF the Exchcquer into two depart
ments gives the note holder unqucstioned security,
while the use Of the notes discounts by the bank.
ing department would give them all the qualities OF
bank note, In this that every cxchequer note right
fully i'm circulation would be evidence not only OF
debt due by the Exchequer, but also OF debt due
to the Exchequer.
What an incalculable impetus would b, given TO
our foreign Pacific trade by the addition OF S20o00-
900 tre oanaole capital OF san Francisco Lett the
proposition be canvassea IN all It's bearings, and II
it presents solution OF financial troubles carry
1t mo effect. II time and space permitted 1t could
tenn saving or $500 900 every ten years nth
OF the national debt would be effected for the nation;
II could be SHOWN tnat the nhpplcst pOutlCA RESULTS
would dow from a better distribution OF banking
capital giving relief TO suffering ana restless por-
tons Of the Union; but I shall not enter further
into the subject at present
TINS Is an age OF grand IDEAS No country rellshes
them more than the United states, and no place Is
more capable OF grasping and utilizing them than
New York. Why allow London TO monopolizc the
trade and money of the worlds New York Is wise
aud mighty enough to sway sceptre OF her own,
and not bow before that OF q rival queen. IL seems
meet that the HERALD as the great exponent Of tne
thoughtful and go-ahead portion OF the United
states, should first present this subject TO the
country A. II.
BILLS SIGNED BY the GOVERNOR