The evening telegraph. [volume] (Philadelphia [Pa.]) 1864-1918, 1871-04-13

announced by telegraph from Washington. I
Hence il is we'll to direct attention to the
subject before the public mind shall have
been poisoned by persistent misrepre-
sentatoD.
We have pointed out already the precise
object of the proposed measure, and how it |
is calculated to enable the banks to earn inte-
rest, at the expense of the people, on money |
which they do not lend, but which thew keep |
in their vaults for their own safety. their own |
convenience, though likewise required to do
SO by the National Bank act under which they
are created. We now propose to explain how
they intend to accomplish this by pretending
to adopt measure which has so many quali-
ties to recommend it that 1t may be said to
have q certain amount of public opinion
already favorably inclined towards it, This
measure is based upon growing recognition
of the fact that the national banks, as now
constituted, are virtually that most odious of
all legalized iniquities, subsidized mono
poly.
The national banks are owners of Govern
ment bonds. They are allowed to deposit
these bonds in the Treasury Department at
Washington, and to receive in exchange for
them bank notes-currency-in nearly equal
amounts. This privilege is denied to every
one except national bank. private indi-
vidual who OWES bonds cannot obtain bank
notes in exchange for them at the Treasury
Department in Washington; on the contrary,
q private individual who owns bonds is
obliged to go to national bank to borrow
bank notes on his bonds, and to pay that
national bank interest on the bank notes, al
though the bank gets them at the department
free of interest. 1t is not a question now
whether the issuance of notes by Government
is wise, or whether it be reconcilable with the
true principles of democratic government
The fact is that the people are willing that
their paid public servants should, among other
things, be charged with the duty of issuing
bank notes on the security of Government
bonds left with them in pledge. But the
people are not willing that they should dis
charge this duty for the benefit of limited
number of corporations; that this discharge
of duty sheuld be coupled with such condi-
tions as necessarily confne its advantages to
a classic q special interest. The right of
the Government to issue bank notes on the
pledge of Government bonds once admitted,
it becomes the duty of the Government to
issue these notes to all classes of the commu-
nifty alike. Under the present law the right
to obtain these notes is limited to a class
of corporations called national banks, who
are by that simple fact constituted
q monopoly. When this national bank
act was first passed the people, intensely pre-
occupied with the war, and unable to recog-
plze the full importance of the measure,
allowed it to pass amid general approval. But
they are now beginning to recognize that they
have constituted the banking interest into
monopoly which forms the very centre and
ralIying point of all other monopolies, and
that they have thoughtlessly raised up power
which has virtually become the chief ally and
leader of the two worst public enemies s-the
railroad ring and the tariff monopolists. 1t
Is under the impulse created by the gradual
recognition of this fact that the recent agita-
ton of the national bank act has arisen. The
people recognize that the right to obtain bank
notes from the Treasury on the security of
Government bonds is general right equally
open to all. They demand that this right
shall be no longer confined to the national
banks.
If the right to obtain bank notes from the
Treasury on pledge of bonds conveyed no
other advantages than what are apparent on
the surface, there might be less objection to
confining it to class for the convenience of
the Treasury operations. But this right to
obtain bank notes conveys another highly
important privilege which the public have
heretofore lost sight of, but are now begin
ming to consider very attentively. The ma
tional bank owns bonds which earn six per
cent. coin interest. These bonds are deposit
ted in the Treasury where they continue to
earn interest for the bank Just the same as
| before. The bank at the same time receives
the corresponding amount of bank notes from
| the Treasury and lends them to its customers,
| charging five, six, or seven per cent interest
| on them. The bank thus earns double in
| terest on single capital-first the interest on
| the bonds, and next the interest on the notes.
| 1t is this circumstance that constitutes the
| sggravation of the monopoly; it is this cir
cumstance that makes the monopoly subsi-
| died monopoly. Against this subsidized mo-
| nopoly, as against subsidy and monopoly in
every other shape and form, the public has set
| its face.
To avoid the monopoly of the banks it is
| evident that the right to obtain the bank
notes on pledge of bonds should be open to
all classes and individuals alike. To avoid
and end the subsidy which the banks have
| been drawing from the community at the
rate of eighteen or twenty millions in coin
per annum, it is evident that the bonds
| pledged as security for notes should cease to
| draw interest while in the hands of the Trea-
| sury: or, in other words, that no one should
| be allowed to obtain notes from the Treasury
except on payment of interest, precisely the
same as if they obtained the notes from any
other source. But as, of course, no one would
borrow notes from the Treasury and pay in.
terest for them unless he had the privilege oi
returning the notes when no longer wanted
it would become necessary to make provision
for getting back the bonds whenever the
owner wanted them. Out of these consde-
rations has grown the plan which, under the
name of ''convertibility of bank notes anG
bonds, " has had very general discussion in
financial circles for the last year or two, anc
has met with very considerable approval
though also with strenuous opposition.
This is not the occasion to discuss tn,
merits of the plan. 1t is sufficient to poin
out that its chief object is to put an end t