The Portland daily press., 1879-04-02
WEDNESDAY MORNING, APRIL 2.
boston Journal ]
Will 1t Payg

inst now little is said in Congress about
financial legislation. Mr.. Stephens and Gen.
Ewing think that the country needs relief and
new greepbacks. The Greenback party in Con-
gress demands the issue of paper money "ade-
quate to the demands of the business of the
country" Mr.. Atkins promises that there
shall be financial legislation in good time.
Still the issue between the two sections
whether the party which saved the Republic
shall rule it in justice, or the party which I'M
dertook to destroy it shall rule it by fraud and
violence, is just now the most pro minent topic,
as 1t may well be.
The present controversy over the appropria-
tion bills will be settled before the expiration
of many months, ard then Congress will doubt
less take time to blunder over the finances.
the ipdationists will be bill to retire the cir
culation of the national banks and replace the
same BY issues of new treasury notes. The
entire South favors the scheme. They do not
like the term national in any other connection
than an appropriation for the benefit OF that
section. They want State banking, because it
will give that section money which it can keep
and which no one outside of the South will
take.
We are aware that there are many men in
the North who are inclined to believe that the
Government would make great saving by
having the notional bank circulation retire
and Treasury notes issued instead. III
there could be no danger in doubling the guam.
tity of Treasury notes or greenbacks in circula-
ton such change would seem desirable, If a
large sum of money could be saved thereby.
NO man OF average intelligence believes the
assertion OF the intiationists to thu effect that
banking under the national act is monopoly,
or source of large profit to the holders of ma
tiona bank stock. The period when such OBJ
jecti0ns to the system had weight has passed.
The important question now is: Will it paw?
The circulation of the national banks is about
1922 900 000 These notes, as q n0n-interest
bearing debt, are worth no more to the Govern
ment than the rate at which it can borrow on
its funded dept-namely, four per cent. -Four
per cent. on $322,000,000 is $12 $4,000. The
average receipts Of the Federal Government il
taxes from the national banks on circulation
capital and deposits the past seven years il
100000 year. DeductiDg this annu
al tax $4,000 oOol from the annua
is worth ($12,sS ,OOO) there remains $780,
900 as the net sum which the Government
woald save without taking into consideration
the cost of Reissue, etc, But this is not The
whole OF the case. Ii the Govern ment fetires
the bauk circulation, and at the same time pro
poses to keep it at par with coin by prompt re
demptiOo. it must provide coin reserve to hoa
the 1922 600, 900 of paper. The smallest colt
reserve which prudent b tDkers deem admissiol,
for the purpose of protecting an unsecured Cir
culation is ope.third of tie amount of circuls
ton. In this case the cum required for thu
1922 100000 will be $107 100000 This amour
of course would be dead capital which the Gov
eminent must hold without receiving any prof
therefrom. At four per cent. the iuteres
which the Government will lose by retainip,
such reserve will be 1890, 900, which, de
Quoted from the $5,S80,000 remsining viii
leave but 81 900 900 as the saving which III
Federal Government will tealize by the chang
on the assumption that it can be effected with
out injury to the business of the country.
In the above consideration of the subject, n
allowance IS made for the local taxes derive
from national BANKS. The amount of sucl
taxes is about the same as the Federal Govern
ment derives from the banks-$7, 900 900.
the national banks should 90 out Of business
the capital invested therein would find inves
ment in bonds and other property which woul
largely escape local taxation. The most tina
could be expected from such capital, If otheI
wise invested, would not be over $4,000, 00(
leaving an annual balance of $5,000,O0O d.
rived from the national banks by cities an
towns, DeductiDg the 81 100000 from thi
surplus of $4,000 900 Of local taxes impose
upon the banks, there remains So 400, 00t
which represents the profit to the people Of th
national bank system over the proposed subst
tuition of Treasury notes for the circulation
the former