The Stark County Democrat. [volume] (Canton, Ohio) 1833-1912, 1878-09-26

rule is reversed. The note of the bank
is an evidence of debt due. II is not
money, it is not capital; it is simply a
debt due by the bank but the bank is
authorized to lend that note and receive
interest upon it. So that the bank ls au.
thorized to receive interest on what it
owes, while every body else is obliged to
nav interest on what he owes. You see
what a privilege this is, and this privi'
lege enables them to draw from the pock'
cts of the people $2l 100000 every year
more than it took to carry on the en-
tire government under the administra'
ton of General Jackson.
Now, in answer to this point IN my
Hamilton speech-for | made the point
In that speech-several gentlemen who
made speeches this day week ago, eth
er blindly or wilfully pretended not to
understand the point. They speak as il
had been talking of interest on the
bonds which these banks deposit for their
deposit for their circulation, when in
truth / was not speaking about that at
all. Why, these gentlemen think that
they have triumphantly answered me by
saying that the banks did not own these
bonds somebody else would. But Il
there was not bond in existence, II
those banks had the power to deposit no
bonds, still upon this $500 100000 of bank
Indebtedness which tLey loan they would
draw $2l 100000 annually by way of in
terest. and that is taken out of the pock'
cts of the people.
Now it is very true that these banks
have an advantage that no other bond
holder has. If you have bond Of the
United States you can drawyour interest
upon it and that is all right, but these
banks do more than that; they deposit
the bonds with the Treasurer of thu
United States, and then they get ninety
per cent. of the amount in bank notes
and loan them, and so they get nearly
double their interest-perhaps more than
double, because they loan their money
at higher rate of interest; 80 they make
their bonds realize them more than
twice the interest which the bond you
have in your pocket realizes to you.
They have that advantage, but what |
am saying about their drawing these
millions out of the pockets of the people
would be true if they had not single
bond on deposit. 1t results from the fact
that the banks are allowed to lend their
indebtedness and get interest upon it
get interest on what they owe, instead
of paying interest on what they owe, as
everybody else has to do. Now, my
friends, from this S21 ,0000 900 which they
thus draw from you every year, let us
deduct the taxes they pay on their circu-
lation' They pay one per cent. on their
outstanding circulation as taxes to the
Government of the United States, and if
the circulation exceeds certain proper
tion of the capital, there is to be hea-
vier rate of taxation, but am not aware
of bank in the United States whose cir
culation does exceed that proportion;
therefore, what 1 have stated is practic'
ally true that the tax they pay is one per
cent. per annum, and that would be $3,-
100000, which, annually draw from your
pockets would leave $l8,000,000 as the
annual draft. But it is very doubtful,
gentlemen, whether it would be deduct.
ed, because l think it will be found that
they put that burden of taxation on their
customers to whom they lend their mo-
ney, and they put it on others, and at
last, like all other taxes, it comes down
upon the shoulders of consumers,
AN ERROR CORRECTED.
Now, whilst speaking on this subject
of taxation, allow me to correct an error
into which several gentlemen, who have
done me the honor to reply to my Ham.
ilton speech, have fallen. They say
Judge Thurman ought not to say the Ma
tional banks pay but $3,00000O as taxes;
that they pay six or seven million dol
lars taxes to the Federal Government,
and that they pay so much in State taxes
on their capital Gentlemen, was not
a bit mistaken. The question which we
are considering is the cost of their circu
ation, and it is not right to give them
credit, except for the tax on their Circu-
ation; because all other taxes they wo'd
have 10 pay, whether they had cirCu-
lation or not. For instance, there are
taxes to pay on deposits, and taxes on
their capital under the State law, and
pray, wouldn't they have to pay them
whether they had bank notes out or not?
So there is no justice in stating that
ought to have mentioned taxes of this
kind, because taxes on their deposits and
capital are nothing more than every pri-
vate bank is compelled to pay, and they
would have that pay whether they had
circulation or not.
But there is another way in which you
can consider this subject. Men who have
made it their study, have discovered, and
in fact it was discovered long ago by
thinkers, that the annual products of
human industry that is not destroyed by |
fire or food or war, is ultimately divided |
between labor and capital. But where |
there is a bank note circulation that di. |
vision is interrupted, the banks coming |
in first, and getting the interest on their
indebtedness, this interest on the loan |
of their notes before the division between |
labor and capital takes place, and that |
leaves just so much less to be divided be-
tween labor and capital AS / have
shown you in this case, the banks step
in and take off the annual products of
this country $21 900, ,000-not for the loan
of capital, but on their indebedness.-
They don't come in virtue of capital, but
from the special privilege Of drawing in
terest on what they owe, and they take
out the $21 900, 900, leaving only the bal
ance to be divided between capital and
labor.
WHAT WOULD BE SAVED BY THE USE OF
GREENBACKs.
Now let me call your attention to the
saving that takes place by the use of the
greenback. Every greenback out repre-
sents value the Government has re-
ceived. That greenback has paid for SER
vices rendered to the country, or goods,
wares or merchandise furnished to the
Government, or help discharge the in
terest. bearing public debt, and so the
Government has received value for ev-
cry dollar of greenbacks. The conse-
quence of this is that the Government
makes a saving, or the people, which is