The Indiana State sentinel. [volume] (Indianapolis) 1868-1895, 1879-09-10

pet corporations from q loss OF this subsidy
and this control over the volume OF the cur
in a good deal of bugaboo talk about the old
State banks, charging with purpose to
all mere scare. Not one Democrat in ten in
either branch of Congress would vote to re-
store the State bank system. The question Is
not one CT choice between State bank issues
and National bank issues, but between cost
less legal-tender currency issued by the Gov
eminent and subsidized currency issued by
Mr.. Schurz ridicules my assertion that the
power to issue money and control its volume
Is a power to raise and lower values, to give
prosperity to industries or inf1lct distress upon
them; that it is sovereign power. and,
therefore, should not be given to private cor
porations, especially those which represent
the interest of the money class, which gen.
debts contracted in cheap money and paid in
dear money. He lifts up mis- hands in horror
involved in giving to the Government this
power to control money and values. my
Democratic friends" says he, 81 ask you in all
of leader you have put at the
head of your party, and what kind of doctrine
voting for him? Do You remember upon
what grounds the Democrats fought the old
M Whigs? Was 1t not mainly that the Old
emulation of power in the hands of the Gov
eminent, while the Democracy contended
that the powers of the Government should be
carefully limited and circumscribed? And
now ! say TO you, never did the EXTREMIST
strous an accumulation of Governmental
power as General Ewing claims for the Gov
eminent IN this single sentence
respectfully suggest to Mr.. SchurZ a little
reading in the political history OF this country
to rectify his notions of the issues between the
Democracy and the Federalists first, and the
Wings afterward, on this question of bank
money or Government m ney. Let him start
with jefferson. and read his letters to Eppes.
in one Of which ne says: "Carthago delenda
est. Bank paper must be suppressed, and the
circulating medium restored to the Nation, to
Then let him look at Madison's message of
December, 1915, where he says: sit may be
nee Necessary 70 ascertain the Terms upon which
shall be issued upon motives of general policy
as a common medium of circulation"
Then let him look at John Ran iolph's ex-
preston of opinion, that Treasury notes in
time of peace are better substitute for gold
and silver than any paper have heard yet
proposed"
Then let him look at Jackson's farewell
address, in which he says: Corporations
which create paper money can not be relied
upon to keep the circulating medium uni
when confidence is high, they are tenn pied by
the prospect of gain. or by the influence of
those who hope to profit by it, to extend
discretion and the reasonable demands of bus
mess; and when these issues have been push
is at last shaken, then a reaction takes place,
and they Immediately withdraw the credits
issues. and produce an unexpected and ruin
Gus contraction of the circulating medium,
which is felt by the whole community. The
banks by this means save themselves, and the
mischievous consequences of their impru-
dence cupidity are visited upon the pub
lic."'
Let him look, too at Jackson's message In
1929, where he says: 81 submit to the wisdom
of the Legislature whether Nationa. system,
founded on the credit of the Government and
its revenues, might not be devised which
would avoid all cons itutional difficulties and
at the same time secure all the advantages
that were expected to result from the present
bank"
Let him then consult George NJ. Dallas. who
said: 1.-The power of the Government to sup
ply and maintain a paper medium of ex-
change will not be questioned"
In the House of Representatives,, February IS,
1915, in which he says: "rhe state of our cir
cuiating medium Is opposed to nth the principles
given to Congress by that instrument in ex-
press terms to regulate the currency of the
though given to Congress, is not In their
hands. 1t is exercised by bank Institutions"
/ furnish these extracts, not for the tnfOrma-
ton of any Democrat tolerably well read in
political history of his country, but for that of
Mr.. Schurz who may be saved by reading
by loose rhetoric on old and familiar issues OF
American politics.
Mr.. Schurz attempts the reductio ad absur-
dunn with my suggestion that the National
banks could find profit in seasons of industrial
distress, Let him consult Pattersons discus
in which he shows that every period of panic
and disas ter to business, brought on by the
of extraordinary profit to 1t and its stock
holders.
100000 divided SAT 900 900 in 1875 and s4i 900
in 1877, the two most disastrous years to the
oueiness of their customers since 1878. The
statistics of ll9 National banks in Boston, New
York, Philadelphia and Baltimore show an
actual fall in the prices of bank stock between
time, everything which money buys fell over
AZ per cent, which shows that the wealth of
cra m relation other nrODertv about 81
per cent. in the four years OF disastrous prepa-
Mr.. sherman praises the National banks for
their loans to the people Of SsS2, 900; Where
did they get the money? Their whole capital
entirely in United States bonds, on which they
draw from to 5 per cent. interest. How did
s32S, 100000 BY having the United States
print their promissory notes. VINO else have
the high privilege OF having their debts made
interest on the loan OF them? You, my friend,
make your note for a hundred dollars and
pay to 10 per cent. interest on it.
The National bank makes its prom,
o DEBT aad aess al Ths
accounts for SS2S 900 of the 1892 600 which
these benefcent institutions furnish to the
people at from to IL per cent. per annum, dis
counted quarterly. The balance OF the $780,
0oo.oOO is made up of other peoples money de-
equally exorbitant rate Of Interest Is it any
wonder that the National banks can pay 10
per cent DIVIDENDS ana lay up or per cent:
surplus each year, even when all industrial
enterprises are perishing and their capital be-
ing consumed? But do not see In this a
reason, as Mr.. Sherman does. why the si0,000,-
00o subsidy paid each year by the people to the
National banks should not be stopped
problem. A National bank with sl0O0O0 in
greenbacks invested in per cent bonds in
1855 received $4,000 OF circulation. If you
assume that the circulation and the interest
on the bonds to be loaned at per cent, ais
counted quarterly, the bank could now close
up its bond and circulation account and pay
OF its circulation and return its capital to Its
shareholders, and In addition divide among
them &32S 900. assume that interest on depos-
its will cover expenses, taxes and other short
ages. This &32S,O00 Is worth as much now as
double the amount was worth in 1856. When
Iafi N r sSxs.