The Portland daily press., 1878-09-11
THE IOWA CAMPAIGN.
Secret airy Nc Urary on the Financial Is


sue.
KEoKUK, Sept 1O-Secretary McCrary OPP
ened the political campaign ia tins state to-
night, speaking to large and intensely inter-
ested audience. The larger portion OF the
speech was devoted to the financial topic,
though the records of the two parties ana the
Southern claims came in for consideration.
The great question, he said, between the lie
publicans and their opponents is this HAVING
reached this solid footing, having secured
currency equal to aud interchangeaole Win
coin, shall We abandon it, togatneF win all
hope of ming specie payments, anu pun &c
again into an uncertain sea OF lonatioh onaii
we have Fl at money TO be issued only py the
government aud ia such quantities ana at
such times as Congress may direct. 10 apao-
don the policy which has brougnt us SO uear 10
perfect financial health would be as absurd and
suicidal as would bs the act of a man iast re-
Covering from long illness who should, OF his
own choice, seek relapse.
The principal plank in the financial platform
of our opponents, and upon which Democrats,
Nationals aud GTeenbackers seem TO agree, is
this: The abolition of the national banks and
the issue by the government direct OF SO much
currency as the wants of trade or tbs business
interests of the couutry may demand. Let me
speak briefly of the objections to that policy.
And first, why abolish the national banking
SYSTEM 1t is admitted that it affords safe,
sonLd and perfectly reliable currency. good
alike in all parts of the Unioo, and familiar to
the people. Its vast superiority over the old
Democratic state bank currency is of course
conceded.
Any satisfactory discussion Of the question
whether this system should be abolished must
include a consideration of the merits of the sys-
tenn proposed to be substituted for 1t. Ii you
have objections to the national bank system,
you should be sure that you have not greater
objections to the substitute which is proposed
for it. Let US inquire, then, into the strength
of the objections TO the national banking sys-
tenn, presented By cur opponents, and follow
this with statement of our own objections to
the new system proposed, viz the Issue by the
government of all our currency.
What are the OBJECTIONS to the national
banking system as presented and urged by our
opponents? ELet me enumerate aud answer
them.
l. 1t is said that this system is a monopoly
or special privilege But this is not true. Ma
tional banking is perfectly free. Whoever has
the desire and means may start national
bank by complying with the law Do our OPP
ponents desire to have system of banking
under which people without means can issue
notes to circulate as money? There are no re-
strlctions upon the organization of national
banks except such as are calculated to make
the nOte-holders-the people-absolutely Sc
cure. and these apply alike to all. This feature
OF the system affords means OF regulating the
volume of the currency as perfect and safe as
any we can have. If there is demand for
currency, more banks will be started to supply
| it, and think We may trust in this matter as
in all other purely business affairs, the law of
supply and demand. At all events, the claim
that the national banking system is monopo-
ly which places the control of the currency in
the hands of few favored persons or corpora
| tious, is absolutely groundless
2. Another objection to the system is that it
costs the government large sum annually in
the shape of interest on the bonds used as the
basis by the banks This objection is equally
unfounded. 1t is true that the United States
pays interest on the bonds held as security for
| the national bank circulation, but it il
| not true that one farthing of this interest
would DO saved by the abolition ofthe banks
Ii we should strike out of existence all the ma
| tional banks, the bonds would still remain, and
| the government would continue to pay interest
| upon them unless prepared to repudate. We
would save nothing in the way of interest on
our bonds by abolshing the banks, but on the
| other hand we would lose large SUN in the
form of taxes now paid by them. The taxes
| paid by the banks to the state aud national
governments, will average over sixteen millions
of dollars per annum. The simple truth, there
fore, is that by ab0lishi1g this system We would
| gain nothing in the saving of interest, AMI
would lose at least $16,000,000 per annum in
taxes do not say that our banking system
| may not be improved. Sooner or later, have
no doubt, it will be amended SO as to use as the
basis of it four per cent. bond, but to abolish
| it and substitute an indefinite issue of green
backs (and any issue left subject to the determ-
| ination of Congress must be indefinitely would
| be the extreme of folly.
1t is sometimes said that the natOnal bank
| ing system tends to concentrate and strengthen
| the money power. submit that the national
| banking law is as free from this objection as
| any banking system can possibly be. 1t is as
| free from it as any Incorporation act can be
| made. 1t is as free from it as is any law
authorizing the formation of corporations to
| engage in any legitimate and honest business,
| whether it be trading, manufacturing or bank
| ing. The money power would be just as potent
| and probably far more potent If wholly ex-
| cluded from the privilege of carrying on
| national banks, and obliged to invest ia other
! enterprises. It is difficult TO see why the
| national banks are any more dangerous on this
| account than an equal number of private
| banks or other private corporations represent
| ing an equal amount OF capital. This argu-
| ment, if it means anything, is aimed at the
| very existence of capital, and can be used with
| equal force against railroads, steamship COM
psnies, manufacturing corporations, and pri-
| vate bankers and traders
4-One further objection have heard to the
national banking system. II is that it con-
templates the psrpetuation of the national debt.
10 answer to this have to say that whenever
the government wishes 10 pay any of the
bonds now held by the banks, it is the right
of the government to pay them, provided they
are due and payable. IL by thus mode the
banks shall at some time 10 the future cease to
exist, the country must when that time comes
tdho care VI Tue interests ana Tue currency OF
the people. This can scarcely happen during
the next quarter of a century, and il is there
fore premature to discuss ii now For myself
however, L have no hesitation IN saying that
believe it would be for the interests of the
government and the people to keen GU tstapdinp
sufficient quantity OF four per cent bond, to
furnish the basis of onr national bank currency
L know of no other system of CURRENCY SO
Stable. SO safe and SO reliable If batter
system can be devised, when the time comes to
ntf hal do If,r,e
the plan proposed by our opponents is not such
a one.
Daring his remarks Secretary McCrary had
read the following letters:
TREASURY DEPARTMENT,
WASHINGTON, August, 10, 1873.
Hon. George W. McCrary, Secretary Of Var:
Dear Sir,-Iu reply to your letter of this date
permit me to say
First. The public debt of the United States. less
bonds issued to Pacific railroads. and less cash in
the Treasury, March /, 1866, amounted to
$7,7O7 $780, zoo %
August l, 1878 ACKNOWLEDGEMENTS. 2J35 5S0224 So
Total reduction since March l. 1868 672 275s75 81
Second. The annual interest due on the public debt
of March 1, 1866, amounted to...S 143 ISL, 1863 IS
Annual interest August l, 1884,. 95,Isi,OO7 80
Reduction of annual interest. .....S 1856 1862 O5
Third The public debt March 1, 1862 amounted TO
So, 525 463, 26a Of
August l, 1878. 2,0355S0, 524 IS
Total reduction since March 1, 1862 4s9 ss2 1876 IS
Fourth. The annual interest due on public debt of
March ], 1869, amounted to......, $126 3S9 $50 90
Amount interest August 1, 187S...... 95lsl,OO7 80
Reduction of annual interest. .....S 3i,2Os5i2 so
Fifth. The average amount of State taxes paid BY
national banks for the five years. 1872 to 1876 in
elusive ESTIMATED for 1872 and 1878 from data de-
rived from reports for other years, no reports of
State taxes for those years having been received)
was ...................... SO 2447 4O %
And the average amount OF national taxes tor the
years 1873 to 1877 inclusive, from the same source
was. .........."....,......... 7,124 305 63