The Portland daily press., 1875-09-28
National Banks.

Aue democratic .demagogues OF the west
have united in an assault on the national
banking system. Nearly all of their public
| speakers declare against it, and their jour-
mails are nearly unit in their hostility. 1t
may, therefore, be expected in the event that
the western and Southern Democracy con-
troll the next national convention, the plat
form VIII embrace some hostile declaration
respecting the national banks. If one can
gather any intimation of what the Western
leaders would substitute for the present nat
ional bank, it is that they would return to
the old state'sovereignty system of banking,
if it can be called system. The most of us
remember it and many to their sorrow. The
billsrof these banks were only good within
| the state where issued, and within those linn
| its were frequently worthless because there
was no power to compel any institution to
redeem its bills and no fund reserved for that
purpose. Beyond Boston, the bills of the
best Maine banks were at large discount
even when they could be disposed of at ALL
The bills of the Western state banks were
quite worthless in the East, while at home
| lAO odLlC Dilio III 1lillCo VI luduCidl pTcSSuTC
were scarcely as current as well executed
counterfeits on solvent banks of the large
cities of the East.
In the first place it may be stated that ma
tional banks are compelled TO redeem their
bills in whatever the government specifies to
be legal-tender. None of the 2,076 nat
ional banks have failed to give green
backs for its bills when required to
do so. The United States cannot make
paper money more valuable than the national
banks make theirs. When legal tenders are
made equal to gold or Withdrawn, the nation
al banks will be required to redeem their bills
in coin. This certainly is an advantage over
| the old state system by which dollar note
was worth ninety cents in county next to
that in which it was issued and but forty
across the state line.
In the second place it is proper to inquire
what the national banks do for the business
of the country. The official reports of June
80, 1875, show that these institutions had out
standing loans to the business public of near
ly 00,000,000, which were lent to more
than half million persons. The borrow
ers were from all classes, and the money was
advanced to move the products of all classes.
The merchants had borrowed by millions.
The manufacturers had borrowed hundreds
of millions to give employment labor. Every
body doing business, and having such secur-
ity as private parties would lend money on,
have been able to borrow money of the ma
tonal banks. This money has been the cir
culating medium of the country and business
men of all GLASSES have come to look to the
national banks for assistance. In addition to
the thousands of millions lent to the business
the banks lent the government $4OO, ,OOO, 900,
amount II III The National bonds. The greater
part of these bonds are pledged to secure the
redemption of the notes of the national banks.
They are at once guarantee of good faith
and loan to the government. The banks
then loan the nation and individuals the sum
of 81 ,400,0O0,000. OF this vast amount the
owners of these banks advance nearly $780,
100000 or half the sum, as will be seen by
the following figues:
OdplJcl pdiu ,0Oo 300
Surplus fqud 13S, t69 094
Undivided profits. ...............",..5 .52, ,16O10l
Total. ...........................$ $691 1897 ISL
The balance of the sum is furnished by the
depostors of these banks.
In the next place, in addition to the vast con-
venience the national system is to the people,
the national bank circulation is perfectly safe.
The bills are secured by United States bonds
which are worth $11 for every SO of bills
issued. Depositors are secured by the whole
resources of the bank outside of the bonds
pledged at Washington to redeem its notes.
No system of banking has ever given security
like this of the United States,
In the next place it is proper to inquire
what this admirable system costs the people,
It's opponents claim that the national bank is
a tax on industry. There is no ground for
such a charge, for so far from being tax, it
relieves industry of taxes by paying the same.
The interest paid on the bonds held by the
government for security is no more than is
paid to other holders of national bonds and is
no part of the banking system, since the in
terest would be paid to the owners of such
bonds whether the banks existed or not.
The only cost of the system to the country is
the salaries of the clerks employed in the cur
rency depal tment at Washington and the
sums expended in printing and distributing
the notes. all of which amounted to less than
So, ,75O, 900 the past year, during which time
the banks paid national taxes amounting to
$61, $40, ,7SS.79. The stock of these banks
pay state and municipal taxes which
amounted to larger sum than that paid the
general government. At the very lowest cal
culation the national banks of the country
contribute taxes to the amount gilmore than
$12O,OOO,0OO at cost of So, 900.
Further than this banking is now as free as
manufacturing. Any persons having the capi-
tai to purchase the bonds can go into it.
There isn't the shadow of a monopoly about it.
In view of the benefits derived from the
national system of banking, the public have a
right to ask what the Democratic politicians
of the West propose to substitute for the
present uniform National banking system
which makes the bill of Maine bank as good
in Texas as in the town where the bank is
located which issues it. Have they anything
to propose instead? If they have, is it the old
state-sovereignty system of state banking?
Do these men hold that the country would
TO be better off to return to the old hetero-
geneous and local currency under the con-
troll of thirty-eight different State laws?
What would be the effect on business to tear
up the present system which has all the i'm
provements that twelve years experience can
suggest, and start again the old wildcat sys-
TEN in its place? 1t will require something
more potent than the crv of hungry dema-
gogues about national monopoly and central
zaton to induce the people to revoke sys-
TEN of banking which has done so much and
can yet do so much more for the country.
JUDGE PERsHING nominated for governor
of Pennsylvania by the Democrats is anoth-
1 \