The daily dispatch. [volume] (Richmond [Va.]) 1850-1884, 1877-01-22

lFor the Dispatch.l

.."9,. fFor the Dispatch.1 - tc.
and the Taxation OF Banks.
One OF the most important reforms to be
rged in Congress this session is the repeal
II the tax levied on the capital and deposits
II the banks. The fax was. a war measure,
ind should be repealed, as it is no longer ne
,essary and is unjust. All Of the commercial
interests OF the country are SO dependent
on successful banking that nothing should
bel done to make it impossible for. the bank
10 earn q living. With the present depression
ia business It is very difficult to use money
at such rates as will pay expenses and leave
ANYTHING for the banks. While Justice and
the public good alike demand the repeal Oh
this tax, It IS also true that they, demand at
the same time that there shall be no favored
class; that the whole people shall be Dene-
flied, and not a few favored individuals:
The national-bank law should be repealed
at the same time that this tax is repealed.
It, too, was war measure, and IS no longer
necessary. The national banks have. no
reason to complain OF the tax Levied on
them by the General Government. They
are fully reimbursed by the profits arising
from the loan Of Government credit. But
the State and savings banks have Just cause
OF complaint, and their cause IS the peo-
pies cause. The State and savings banks
are taxed iustas the national banks are taxed,
while they are excluded from the profitable
business OF issuing notes. The national
banks receive a bonus from the Government
in the profits on circulation amounting to say
$4,000, 900, according to the statement OF the
Comptroller Of the Currency, while the
total amount Of taxes on capital and de-
posts paid by them to the General Govern
fhpf
the profits derived by the: national banks
from this loan of Government credit Is
much greater than the Comptroller is dis
posed to admit. he is wonderfully partlal
to the national banks, and seems to try to
place them before the public in the light OF
martyrs to public good. We shall see Low
much OF this sympathy they really de-
serve. The total amount OF capital actu-
ally locked up in the holding of bonds
to secure circulation by the national banks
does not exceed $40, 100000. The currency
value Of the interest paid on the $685., 900, 900
bonds thus held is, say, sl9, 1000, 600. De
duct from this sum 5 per Get. on the capl-
tai invested liz the transaction-anus per
cent. is surely living rate-and you have
the bonus paid to these martyrs for the pub
lie good, say S12 100000. Butte be exactly
Just, deduct from this a:haH Of one per
cent. on the circulation; for while the ma
tional banks are taxed one per cent. on the
circulation they do not pay any tax on the
capital invested in bonds, so they are only
entitled to deduct the excess OF half OF
one per cent, as all banking capital is taxed
a half Of one per cent, which amounts to,
say, S1,400, 0e0-Ieaving net bonus OF say
$1e,600,OO0 paidto them by the Government.
Thus you see how the Comptroller favors
the national banks, and tries to make
martyrs OF them, while in reality the 49,
900, 1000 people Of this country are annually
taxed about S25,000,000 to support the
machinery Of the system, and to
pay to the 100000 holders OF national-bank
shares this bonus of S10,600,000. These
are the figures; there is no~guess-Work.
Banks, it is said-and truly said,-recoup
from their customers the sums to which this
unskilful taxation subjects them. Which
class Of banks, then, are the people most in
terested in seeing relieved Of this burden
of taxation? we find that the people are
most interested in therelief OF the State and
savings banks. Why? Because they, as
has been shown, pay this tax in the end, and
they deal more largely with the State and
savings banks than they do with the national
banks. For while the deposits of the No.
tional banks aggregate only $685., 100000,
the deposits OF the State and savings banks
aggregate S1,361 100000, or more than
twice as much. While we are rearranging
our financial system let us make thorough
worl- of 1t, and get rid OF all OF these war
curses. The people know that they are
unjustly burdened by this cursed system Of
national banks, and cry out against it. Thus
far the influence OF money with corrupt
men has stifled the voice OF the people and
continued this great wrong Of taxing the
many for the benefit Of a few-a gross
wrong, which the yeriest tyro in legislation
recognizes. ".'
Why should not the people get the profit
arising from the business OF furnishing o
circulating medium? The national banks
and their friends are those who cry out
against ''rag-money," irredeemable trash,
sc. Suppose the Treasury notes are with
drawn and the national-bank notes left; are
they different from the Treasury note
They are much the same. The difference Is
more apparent than real. Both are Govern
ment issues, in fact, with the same provi-
sion for redemption. But we must have a
mixed currency. The most extreme advo-
cafe Of hard cash will admit this. While the
Government, must use gold in many in
yet in ordinary business transac-
tions the metal is too heavy, and paper has
to be substituted. Now, why should the
national banks reap the profit arising from
this business Of furnishing q circulation 1t
is only the credit Of the Government that
gives currency to their notes. Withdraw the
endorsement and they would be
as bad rs the old State bank issues; and God
deliver us from that curse. The shame Of
having an irredeemable issue which. the Coy
eminent refuses to take in payment of
duties can be avoided IL the proper course
is pursued. The time fixed for resumption
Is January /, 1870, To make this, possible.
to secure an acceptable currency, and Sc,
cure to the people the profits that Justly be-
long to them, let 'theI following course be
pursued:, Let national banks be abolished,
and no issue except ythe General Govern
ment. allowed, Require the national banks
TO retire their notes in greenbacks.H Let
the Government purchase ION 2 the mar.
ket bonds equal In amount to the bonds
held by the national! banks to secureIcireu-
ation, issuing coin-certl ticates Of like de-
nomination: as 1.-THE national!bank notes,
receivable for all dues on and after the first
day OF January, 1879. Let bonds bearing d
lower rate OF interest than those purchased
be issued and sold DO purchase gold ito the
extent OF heTreastry notes now in circu-.
alton as the opportunity offers during the
year. Mr.. Tilden, In his letter OF acceptance,
says that the national banks ear: sell In Eti-t
rope the bonds now heidby them to secure
heir circulation for an amount IN gold
sufficient To redeem their notes. Fl; the
banks can raise, $500. 200, 600 in gold on
credit, surely the Government
IAN do the same thing The $500, 008, 600
rom this source, together with the accu-
mutation from revenues, will give about