, 1876-01-24
THE CURRENCY,

1n The Editor Of The Chicago Tribune:
Tho Constitution very properly places tho
coinage Of money exclusively under the control
Of tho Government. Tho trainers Of tho Con-
ot,tution thought they Ind nsyed tho country
from tho dangers of paper money whom they
prohibited tho 9tatea from emitting tIlta OF
credit, or making anything but gold and silver 4
legal.tendor. Willis this interd|ctlon docs not
o1tend 10 tho Federal power, It WAS never lt,-
tended tho Government bhoutd Issue forced pa-
pcr-monoy nuY further than tho extgencics of
war, or any other great emergency, required.
It is quits possible that. had our fathers antci-
patcd tho great ehangoa Of a century, shcy might
hnvo fotcscou low impossible II would be for
this county to adapt its vast businoss-conca1na
to an exclusive metallic currency.
It Ia hardly worth whlle 10 dscuss the cur
rency question In tho Hight of tho Constitution,
einco wa must admit that, in legislation and
practice, wo have gone widely astrAy OF the
fundamental Law. Allowing this transRrcss!on
To hayc been Aoulewhat patdonab1o BY tho on,iH-
alon OF tho Constitution 70 provide some hor+ OF
paper.cusrcncy, and partly condoncd by almost
ceutury Of caiamttous banking, 1t may bs vol
To tnQulEo whethef everything las boen done
that can bo done 10 runody the defects Of carly
prejudice and partisan legislation.
The War produced tho National BANKING nct
and taxed tho circulation OF Btato banks out OF
existence. This was movo IN the right direc-
ton. Whllo tho new systcm Is groat improve
mcut on anything in tho shape Of banking VIC
evcr had before, theto is roaaon to belIsyo Tint
It's ussfutneas will be seriously impaired on tho
resumption Of fapecio-paYmentS e. pot 80 much
owing to defects In the lam, ~ from the inabil-
ty Of 30 many banks to redeem lhoir notos In
coin. Under Tic old RtAto.bank Ryssem,-
notably in Ohio, Indiana, Missouri, and Iowa.
shnrc wsa community Of interest among tho
branches, which redeemed for each other. No
such fraternity can ottnin undor tho National
sysrem- For obvious reasons this would not bo
practicable wien applied to 10 many bankA opor-
asiug Ia every State and Territory Of the Union.
Tie Comptroller Of tho Currency boasts that
only forty National Banks havo failed. As they
have never been required to redeem their circu-
laston u coin, no trial OF their strength and tn
tog1ty has ever boon tnadn. II por cont of
the number have failed during period of gen.
oral nuapenston. what will DO tho fate OF tho
balance on resumption? In ali parts Of tho
county tlIero are wOak and tickly institutions,
struggliDE 20 conceal tbs skoletons in their
vaults. This Is not the fault Ut tho aystem. SO
much al II IL inherent in tho business itaclf.
Tllorc arc good meIchsuts, and good farmers,
and good builders and there aro poor ones. A
highor standard Of success ought not to bs or
pcttGA VI Alu1E WIZ cNkoi tAo lloAA u uduklHkt
go long a. 1t il open to all sorts Of people, with
or without capital.
IA Tho National Banks offer no better security
to dopoBitora than that offered by prlvAte OF
State institutions las natter Of fact this ntnto
ucnt Is untruo.-ED.l, the tuscreatB Of tie
public would DO hotter protected by banks of
deposit regulated by 6sato laws {?). Such itsti.
tutions having no circulating noteB to provide
for. moro rigid ayssom OF examination could
be enforced. Not complicated by false ligbta in
fitN 0f Hhnn6h 1HnnRtaA tn cir
tion." aud "promtum on bonds, the experience
Of Al expert wnuid not be required to huslyxo
their public statements.
Tho Government gives tho banks a fictitious
character BY indoraing them III National In
s.tutlons and then. in case Of tbuir fnilure dis
claiming ill responsibility for tlletr Illegal acts.
and utterly repudating tbs cla,ns duo deposit-
orBt A GrAud jury has indicted the preai-
ttoual Banks which have failed in Chicago
on the Charge Of enbezzlsmsnt preferred by an
injured creditor. Tho Government, It would
seom, noyer interfores with the Illegal ssansac-
tlonB Of bank except where 1t il = creditor. It
Aasunea no moro responsibility oyor their man
agomonk than 10 collect the somi-aunual taxes.
as though they wero tobacco. factories or dis
tilieries When bank fails, tho Government
appoints an undortater to wiud up its afalrs. It
redecns tho circulating notcs with tho bonds
hJpotlecatcd for the purpose, quietly pocketnE
tho 10 Or 25 per cent margin over tho circula-
tiou leaving the depositorB to look out for thenl
aelyos. [1,Lis Ia utterly untEua. Eycry dollar
left after rejeoming tho notes .e paid over to tho
creditors Of the hank.-ED.] IhlH IL about all
tho consideration there is for tho high-eoundiug
title Of " National" bontomod on Bomo 2QU0
banks. Aud on this slender apology wo have
ofectod tho fabric Of = national cursoncy las
the assertions nro falao, such conclusions fall to
Tho systom of periodical examinations and
official reports IL = pleasant deceit. The hI,-
pointment Of Dank-Exam!nor ts usually tho re-
ward OF party-serv1ce aud not for any Hpociat
adaptation for tho work. II lo IL ''on tho
maize" he will aim to ropress, instead OF expose,
tho tlnancisl foiblcs Of tits wasls. Responsible
to the Uurronoy Department only, hiR field Of
operation is 80 remote tlat thcro can bo no d.
rcet supervision, either Ovor him or tho bauks
by tho Government.
supreme objection 10 tho National Banks is
tho danger Of their combining for political pur-
poscs or for thoir own soltlsh interests. [Uosh y
80 many banks. working under tho 8au,e incor.
Interest, arc abso TO exercise gigantic fosuo In
their oNn behalf. Huch combination would
load to organized opposition. While one party
would sussain tue bauku in thcir de-
msnds. tho other party. would u'to to
tho law, or by Oppressive taxation. Tho result
Of such conflict could not DO otherwise tlan
disastrous.
With coln.reaemption, tho pnb.Io must DO pre-
pared for an arbitrary and expensive system OF
Southern banA.noteB will ho at discount In
Now York Of x 10 ;1 per cent, while California
currency will 10 discounted from TO 2 par cent,
--dopondlng on tho cost OF conversion. This
ls ahees aaeunption. The preaon. law requiroH
all tho banks to redeem thoir notes ii,
]eeal.tender at tbs Treasury in WaYhInK-
hon. So shey may DO required to do attor
resumption.-ED.l Coutrnl redemption will
hs inlprnoticablo, except in tho vicinity Of largo
cities, The Nom York bsnkH will retro their
circulation, and thea force the country institu-
tion 10 redeem in coin. Mot II thero ia profit
in olrculat!on.-~Ep.l Tue Express Cornpanies
will become tho Clearing House for currency Ee-
domptiou. Fiyo per cont bonds will 80 beow
par ln coin. WHY so7 Such statement Ia nom
ssubo.-En.1 Panic md alarm will aoizo uron The
public and tho banks, ending IN a collapuc Of tho
hyHtem. [All tils Is boa,. There Ia no panic
and alarm among the Canadian banks, shicl.
Iedeom theh notos on demand. and hare done ~
Tor afty years, Theto y mono among tho English.
or bwiBs bankB, The baitks Of tho unitod etatos.
whono uotea Wose occurred by sound stocks, aud
wloBe chaFtesA did NOS permit Wild eating. kept
in circulation a geuefat average Of 5000 U0O tEt1