, 1873-09-18

THE BANKS AND THE ORANGES.
4 Granger writoH us his objections to tho Ma
tional Banks, to which wo givo place in our
columns, az they Reom to be representative OF
protty large constituency. Without repeating
our former arguments on this question, We will
briefly notice tho mtsapprohensionB Of our cor
respondent.
/. The first Of these Is tho assumption that
pnitcd etates legal-tender notes arc money.
These notoa aro past duo and protested paper
tho signs and oyidoucos Of national bankruptcy,
or what is worse. national bad faith, Each noto
Ia tho promise OF tho United statos to pay 60
many dollars-a promise which is not fulfilled,
snd which, with abundant RESOURCES ut COM
mand, there is no attempt to fulfill. ALL talk about
substituting grocubacks in place OF National
Bunk notos looks to tho further aud indotinito
postponomont Of tho resumption Of specie pay
ments. An irrodeemablo currency is an unnlitl-
gated cheating doyice, fraught with tho graycst
injury to an persons, except the tribe Of apoou-
lators, and especially to farmers and laboring
men.
AAt AA0 R4o0 ~A PAFAA6 VI t0A SoAk 4AtC4Oob
on ss0o,oooooo Of bonds by calling in tho bank
notoa can only be mado effective by compelling
the banks. who now own the bonds, to accept
grecnbacks for them. There Ia nothing In any
existing Inv which requires any man to sell hia
property, whether it bo invested In bonds or real
eatato. The Government may revoke tho char
tors Of tho banks tit reserved tho right to
do so), but It cannot conlscato their prop
orty. II may say to the banks, "Givo back
your notoB and tako your bonds," but after
this is done tho bonds still draw the
samo interest as before, and no saving
iB effected. 'Dut tho Government can then is
suo $500, 0,000,0 900 more groonhacks, and with tho
proceeds buy the bonds." f We grant tho right
Of tho Government, In tmo Of peace, to issue
ita notes, redeemablo at no timo and no place,
and make them legal tendor in payment Of pri-
vato debts; that IL, Il ne grant tho right OF tho
Government to mako forced loan from tho
poople, without any great public e1igoncy re-
quiring such Rtep-no still have accomplished
nothing except to exchange ono form Of
indebtedness for another. Tho greonbAck is
dobt just as much as the bond. :'But 1t does
not draw interest" Thon the proposition IL to
practically repudnto $500, 900 Of public in
dobtednesB in order to saye 615 por cont interest
TO zopudato temporarily il not permanently.
Why atop At $9o0,o0o,0o02 Why not issue
greenbacka for all tho bonds in tho Same way7
III. TAe loss Of National Bank currency by
fro and other casualties inures to the advantage
Of tho Government nov. No new legislation is
needed upon that point.
~. The National Bank notea do not depend for
their value upon the Government Endorsement.
Tho Government, in point Of fact, has not in
dorsod shom. It engagea to sell tho bonds
pledged for their redemption, In case tho bank
falls, and to apply tho proceeds 10 tho payment
Of tho notes. It also agrcea to recovo the notes
In payment OF informal revenue tAxes. Tho
notes depend for their value exclusively on tho
property Of tbs bank. -.
?. Tho ratio OF interest for tho uss of cap-
ital docs not depend In tho smallest
degroe upon tho right to Issue
papor currenoy, ether In tho form OF bank notoB
or Government notos. separate argument
would perhaps be required to show this fact
All that wo have epaco to aay IN thia article is
that interoat ia paid for tho uso Of commoJitioa
such "a tools, breadstufra, provisions, natorlals
and other tangible creations Of human indus
try, tho use OF which enables tho borrower to
produca aud earn more han he could do
with his own uneiled labor. It makes
no dlfroronco, 30 far as tho rate of
interest goes, whether tho paper cur
rency which measures these commodities And
facilitates their exchange among tho different
mcmbers Of the community conBists OF groon-
baoka or bank noses. THO multiplication OF ono
OF tho other can aud nothing to tlse amount Of
loarablo capital ip tho country, aud therefore
call in no wHo loHor the rate Of intorost.
VI. 1t would Of course be inoonvoulent for tho
National DAnka to call in their circulation aud
take up their bonaA. It Ia generally inconyen-
lent to change tho form Of AL inyostment. Il
would be moro hconvenisnt, however, to tho
public than to J the banks, since II would
neaesaItato tho curtallment Of about ono-half OF
their loans and discounts while the change WAS
being effeotad. But 1t would not diminish tho
profits Of the banks to tho extont Of ono-flftL
OF ono psr cont. re know, a. matter OF fact
that at tho time tAa Q por cant bondu wers Or.