, 1877-12-08

tentton to tue Obvious necessity OF national
system for the safe-koeping Of the surplus
earnings Of tho working classes, Congress
will scarcely neglect to tako the subject
under advisement and discuss the means
best adapted to tue end In view. Secretary
SHEnaAH's Recommendation Of such system
is based upon popular demand that has
been generally expressed since the many
savings-bank failures Of the past yoar, and
upon tho successful experience Of other Gov
ornu,ents, where It hos long been the Gus
tom to provide national guarantee for de-
posits Of savings character. Mr.. SHERMAN
says in his report:
Tho sttsnli on Of Congress- ts callad 10 tho great
value TO fellow citikens OF the organization Of
some plan for tho collection, safo-kceptng. and
profitable employment Of small tteposlts by tho
people. How far this con bo done without tsonch.
Ing upon tho proper functions Of the State GOVERN
n,cnt IL queatlon OF difficulty; yet 1t IL important
to secure. II possible. gencFal syston throughout
the United 8tAtcs. This can hardly be effected by
tba organization OF multitude OF savings banks,
depending upon the fidelity, integrity. and skill Of
thetf officers. but the beneficial objects Of snch
banks might b. secured b. authorizing tho deposit
Of small sums with any postal monoY-osdcr otice
In tho United States, anl tho Issue Of Government
certldcatos convertible on demand OF tho holder
Into 1 per cent bonds Of tho United States of
such character. description. and amount ~ will
enabte and induce prudent persons to convert
thctr earnlnRz Into pabflo sccurtty Of asAblo
value. Tha money tins received could bo en-
pioyed IN tho redemption Ut outstanding bonds
bearing q higher rata Of Interest Dy some auct
systen II IL believed that the great body OF our
public deht reduced TO ita sal1est possiblo burdcn
could bo distributed among our own people. With
slight modification Of existing law ih!s beneficial
result would bo socuEod. Tho deposits now held
bY savinus blnks throughout sha country amount
10 $8l3 ILL., 804. depositcd by I, 700, 600 pessona,
and mostly BY deserving ctlixens, who thus wisely
seek to preserve anal savings for futurs need. No
object cuuli moFe strongly appeal TO the cont!der
ato Judgment OF Congress-. Tho heavy losses that
hayo hcen sustained through savings banks. whoss
funds hare been !mpEovEdcnfly loaned upon iasuf.
aetent security, have !n1ictcA fae gseasss lnIury
npoh tho dupos!toss than would s!mllnr !osa sur
fcrcd BY persons enRnged In banking ur commercial
pursuits. Thu Secretary, therefore. recommends
That authority bs granted to isaue certificates for
small deposits, convertible Into per cent bonds
now authorized W Law, tho proceeds to bo used
solely fns the redemption Ut bouda bearing higher
saso Of iutsfens. and now sndeemsblo ut par.
The System recommended by the 8ecrs-
tary Of the Treasury Is, to all intents aud
purposes, tho English system, leaving the
details 10 be adjusted 10 tho working OF The
departments to which It will DO attached.
It has been suggested that a system Of bank
ing In vogue In cortain parts Of Germany
might supply tho need. Under the German
system the deposits are guaranteed by the
Government, which appoints tue officers OF
the banks, a regular banking business is
done, loauing BY preference to The deposit
ors, who are likewise In sou,s sense stock
toldcrs, the interost they receive on their
deposits il regulated BY the profits on the
business. 1t IL appasent, however, that such
a system would be attended By great risks
under our form Of Government. A banking
business, done nndar the auspices Of
the Government, md depending for
its honest and intelligent manage
mont upon officials appointed under
the usual political influences, would not bs
50 safs g. the private savin6s.banks system
which 10 now 70 generally condemned. Par.
tisan favoxitlsm would induct incompetent
men into the control Of tho banks and lend
to the negotiation OF bad loans on worthless
| securities !; 10 make the Government respon.
s,ble for deposits subject 10 this sort Of ma.
nipulatton would simply be to impose. upon
it an annual burden OF dsialcasions and
lossa.. No system can be adopted which In,
volyes tho necessity Of tbs Government, di.
reotly or by agents, doing anything liks I
banking business. II IL simply . question
Of sfosding obsolute safakesping for sas
ings-dsposits, and paying = Amall lntesss
therson, without mourning loas or risk on th
part Of either tho Government OF tha d.
poaitors.
The fact thA! tho Government is larR
borrower, and must Of necesaity continue X
BE- 70 for an indefinite period, Offers tho op
portunity for the proposed system Of safs
keeping Of dsposita- Secretary 6HKEx4,
atatos that tho savings-depoaix Of ths oouu
try amount 10 nearly $3.50, ,00o. COO; but thi
il not ons-haH The s.aount which the Cor
srnment Dyes, 70 that the entire sum o
sarings~depo~its could bo taken BY the Gov
| eTnmept without snv tosx In fact thar