The daily dispatch. [volume] (Richmond [Va.]) 1850-1884, 1878-07-20


Ing to keepthe public debt out OF the con-
gressionai campaign. 1T was not strange,
therefore, thar, cutting the articles out as
we came to them, and writing the credits
some time afterwards, we should have hete.
geographically put the name of the one pa
per for that OF the other.
s..--.... -.
SsrcenhacIks or National-Bank Bi1lse
TO Tie. Editors Of The Dispatch:
3 wrote an article under the above caption;
to prove that it was desirable to replace the
national -bauk notes with greenbacks. which
appeared in your paper Of the 18th instant,
and which you were pleased TO criticise.
Thanking you for the criticism tfor, as iron
sharpeneth iron, 80 a man sharpeneth the
couDteuance OF his friend, / beg you to in-
duIgc me while endeayor to meet your
objections to the views entertained by my
self. My communication may prove lengthy,
bu. i promise to he RS brief as ] can. ~. s
In my former article I gave the figures
which prove the national hanks reap bo-
nus inissufng the Treasury notes with their
names printed on them, which they call
their own notes, equal to eighteen and three
ffths per cent. OH the money actually IN
vested in the bonds held to secure cIrcula-
lation. did not exaggerate their pronts,
but rather underestimate them. our
| first objection is taken here, and you ask
| why, IL the business Is so profitable, do not
! fhe miilionaires ofthe North go more extern
siyely into, the nationai-bank business !!
| The answer is plain. When the national
banks were organized the circulation was
limited. and the amount was fully taken UP.
When the restriction was removed banking
| had become very risky business, owing to
| the terrible distress prevailing in all depart
| ments OF trade So capitalists have pre-
lferred to let banking alone. Nor nave tue
banks been very prosperous since the i,ee
banking laws went into effect. NeVert[ne-
less, they have been subsidized TO tue eS-
| tent to which point-paid this SUBSIDY
out OF the pockets Of the ,peopie, for winch
no consideration has been given. Inc
money thus wroBgfully taken from
| the people has been lost in bad
debts. and by mismanagement OF all
sorts. The fact that they are sub.
sidized does not show that they Will me-
cessariIy prove good Investment to snare
holders. How many hundreds or taOu-
sands of dollars have been squandercd on
steamboat lines that became bankrupt from
mismapaeenent? Yet, will any one deny
that they received the bonus without rem
dering any service? i think not. But l
think that you must -noW see that the ma
tional banks do receive this bonus, and are
vet not bonanza for shareholders IN these
DAYS. . In the flush times they were nine
of wealth to the fortunate ones VINO were
in the Treasury ring and secured charters
when the circulation was limited. Let us
see what they did in the first ten years OF
their existence They paid dividends ave-
raging ten per cent. per annum, or, IN
other words, they returned 10 the snare
holders dollar for dollar Of the capital stock
| ri s30O. O0O. 900, and had accumulated sur
Mus fund, after charging Oft all bad debts,
! Of, 100000 900. That is what I'd call a
rich harvest One hundred and eighty NAL
lion dollars of these cast earnings came
| out of the poccets of the people to pay IN
terest on the bonds held TO secure crcattdt1 tor.
Your second objection is thus stated: ST
the Government were to tax the national
bank notes out of existence would it save
the interest that is now paid to the banks
on bonds held to secure circulation 2" and
YOU answer, g No." and say further: 'The
thanks would hold on to the bonds or sell
tbemto some one else who would draw the
interest; and that If the Government UNI
dertook to purchase the bonds with ire
deemable greenbacks the bonds would go
| so far above par that the people would lose
| ten dollars for every ono that the Govern
ment would save; and, If the bonds were
purchased with redeemable greenbacks, the
Government would have to issue new bonds
to get the gold and silver. and had better
| let the old bonds remain out" Letus see
il that be true. Suppose the tax is imposed
by the Government on the circulation Of
4 no, l.cc RI
ness unprofitabIe; and at the same moment
the Government offers to purchase at the
market rate 1.-THE present market rate, though
4 think they could be had little below that
| fieure> the bonds held by the banks to Sc
| cure circulation, what would be the effect !?
| The banks want to get rid OF their circula-
ton, and there is only one. way-that Is, to
replace it with greenbacks. There is only one
source from which to get the greenbacks,
and that is from the Treasury. SO the notes
would be sold to the Government, and
greenbacks would take the place Of bank
notes, or rather we would wipe off from
our Treasury notes the names OF the banks
to which we are now paying tribute, and
the load Of twenty millions OF taxes would
be lifted from the backs OF a long-sufering
people. You ask why would the banks go
| to the Treasury to sell their bonds? Why
would they not sell to other parties? will
tell you why. The volume OF currency is
sufficiently small now, and the banks dare
not contract it. 1t would be putting the
knife to their own Threats to do It.. They
dare not withdraw from circulation their
own notes faster than they can replace them
with another circulating medium. The only
one to be had is the greenback, and the only
way to get the greenback would be to sell
| to rba nj
and complete answer to your objection on
that head.
| You state your next objection thus: "But
| IL it could. would it be wise forthe Govern
ment to put down the banks and furnish
the currency itself?" "If we have not
half enough money now invested in bank
ing associations, it is easily to be inferred
that we should in the case supposed have
none." "People are not going to do bank
| ing for fun, nor merely for public accom-
mediation. Some of our Virginia papers
are complaining every week that in Virginia
| there is woful deficiency of banking ac-
| commodations." g How would it be if the
banks bad to bank upon greenbacks?"
You mistake. The Government is not
asked to put the banks down; it is only
asked to rid itself OF the lecch that draws
$20,000,G00 Of the life-blood Of the
people annually. You think IL the
privilege OF issuing Treasury notes is
withdrawn that banking capital will be
driven to seek other employment. DO not
think SO, and / will tell you my reasons !:
Judieious banking is profitable when there
is fairly prosperous business being done,
when the bank is only bank OF deposit
and discount. Look to England, your ideal
of excellence. The subsidy to the national
banks has forced the State banks to doubt