River Falls journal. [volume] (River Falls, Pierce County, Wis.) 1872-2019, 1874-03-06
THE PEOPLES BANKS OF GERMANY.
A Union savings Bank system.

A writer IN the Boston journal de-
scrbes the popular credit banks OF
Germany, of which, at the last advices,
there were nearly a thousand IN exist
ence:
I'm business city like ours, who
can look upon the Catholic churches
now in process of erection among us
without being struck by the financial
skill they implyl Those immense and
noble structures, calculated to last for
ages are built IN reality by one of the
/ least wealthy classes of our community
by servant girls and laborers-who
supply their regular contributions,
insignificant separate, and not felt by
their givers, but mighty in the aggre-
gate, as we shall see. Why cannot The
laboring children of this generation be
equally wise in matters of temporal
welfare-that is TO say, why can they
not use their enormous aggregate cap.
ital for their benefit, instead OF being
dependent upon the crumbs doled out,
often at exorbitant rates of interest,
by wealthy capitalists, or goi1g
through the world with the impression
that their only capital is their muscles,
which may fail them at any time, and
upon which they can never realizes 1t
was doubtless bordering upon some
such questions as these that German
by the name of Sohultze Deltzsch hit
upon practical idea. He saw that
the laborer, like the tabled rods, was
financially Weak as an individual, but
powerful enough for all his purposes
as member of community. That
ability to labor, which is so poor a Sc
curity IN any one mans 3ase, il, when
a thousand of such men are associated
on sound basis, to use a translation
of the Germans language, ga perfectly
/ good negotiable commodity.
/ Out of this reasoning came the peo-
pies banks OF Germany. They are
formed by workingmen alone Each
member subscribes fer one share,
which is all he is entitled to hold.
The price OF each share is about $3.50
1t is paid on entering, or in monthly
installments after entraece-t these in.
stallments being as small in some cases
as III cents. There is an entrance fee
ranging from IS cents TO $3.50, paid in
the same way. Ihe profits of the bank
are divided among the members IN
proportion to the amount each mas
paid; and, until share is fully paid
for, the amount of the dividend upon
it is credited in part payment. Suita-
bic regulations are made for withdraw
al. These contributions, of course, do
not supply all the capital required.
The society is for the purpose of Dor
rowing money, which is raised
on the Joint credit of the mem.
bers, in virtue of the uulimit-
ed liabity of all of them. Each
member is personally liable to the full
extent of his property. This is the
foundation stone Of the system. The
profits to the members accrue from the
simple fact that the bank buys money
at wholesale and sells il at retail to its
customers. The difference of price in
Germany is generally about 4 per cent.
The nottingham of Germany, there
fore. can hire money to a proper extent
as readily and cheaply as his employer;
while, as a member of one of these
banking institutions, he has a share of
the profits accruing from the total loans
which, 1t will be seen, is practically
rebate on the rates of interest he is
himself paying. In other words, these
banks are cooperative stores, dealing
IN money instead Of groceries and other
like commodities.
They have now stood the ordeal of
the trial, and must be pronounced a
magnificent success. Even the Franco.
German war added to their number
and to their popularity, for they held
their own-owing to the prudent coun
sells of their OTiginator-w while other
banks were breaking on every side In
1859 they numbered 50; i'm 1863 there
were 735. During this period their
membership arose from Is, 100 10 304,-
772 and the borrowed capital from
$3.50, 900 to S32, 50O,0 This alone
shows their credit and good standing.
They are all parts Of one system, each
association forming part Of provln-
clal union. and the unions being
leagued together. The reports of each,
showing its exact financial position,
are sent TO a central bureau, and are
condensed in an annual publication.
These facts are sufficient 20 show the
principle of the peoples banks Of Ger
many. 1t will be seen that il consists
not only in consolidating and utilizing
the means of laborers, but in making
them lever for securing their share OF
the capital of the country. II makes
the workingmen as Independent, ac.
cording to the means OF their class
mot themselves Individually, as any
other class of their countrymen. Why
could not the plan be adopted with
equal, or even greater advantages. IN
the United States Different repula.
tions would undoubtedly be required,
and extreme vigilance IN guarding
against abuses, particularly if the plan
became popular; but the principle il.
self seems Of universal application,
while the resources of capital awaiting
its command are larger here than in
eny other country.