Burlington weekly free press. [volume] (Burlington, Vt.) 1866-1928, 1881-03-11
NUMBER 81.
The Presi5en.'s Vcto

The following is the message of the i'rcsi-
dent vcioing the Funding I'LL
To the House Of Representatives lEav-
| ing considered the bill entitled ''Nn act to
| facilitate the rcfundins of !hc National debt,
| | am constrained TO return ii to the House OF
| Representatives. in which # originated, with
the following statement Of my objections To
| its passage. The imperative necessity for
prompt action and the pressure Of public
duties in this closing week Of my term Of
Office compel me 20 refrain FROM any attempt
to make a full and satisfactory presentation
of the objections 10 the bill. The import
ance of the passage At the present session ol
Congress OF 4 suitable measure for the re-
funding of the National debt which is
about 10 mature is generally recognized.
1t has been urged upon the attention
Of Congress by the Secretary of the
Treasury and in my llst annual message
If successfully accomplished i: Will secure
a large decrease in the annual interest pay
ment of the nation, and earnestly recon-
mend, if the bill before me shall lall. that
another measure for this purpose be adopt
ed before the present Congress adjOurns.
While in my opinion, i Vould be wise 90
authorize the Secretary of the Treasury in
his discretion to offer 10 the public bonds
bearing 81 per cent interest in aid of re-
funding, | should not deem it my duty To
interpOsc MY constitutional objection 10 the
| passage Of the present bill IL it did not con
tain in its fifth section provisions which, in
my judgment, seriously impair the value
and tend TO the destruction Of the present
| National banking system of the country.
This system has now been in operation al
most twenty years. No safer nor more benc-
| ficial banking system was ever established.
Its advantages as business are free to all
who have the necessary capital. 1t furnish
cs currency TO the public, which for CON
vcnicncc and the security Of the bill-hoder
has probably never been equalled by that of
any other banking system. It's notes are Sc
cured by the deposit with the Government
of the interest-bcarinS bonds Of the United
States. The section of the hll before me
which relates to the National banking sys-
TEN, and 10 which objection is made, is not
an essential part of 4 refunding measure"
The President here quotes the fifth section,
and says:
Under this section it is obviious that no
additional hanks will hereafter he ORGAN
zed except possibly in a few cities or
| localities where the prevailing rates of in
terest in ordinary business are extremely
| low
No new banks can I've organized and no in
crease of the capital Of existing banks can
be obtained except by the purchase and de
post of three per cent bonds. No other bonds
of the United States can he used for the
purpose. The one thoTsand millions II other
| bonds recently Issued by the United States
and bearing higher rate of interest than
| three per cent. and therefore 4 better secur-
ty for the bil-holtlcr can not after the first of
July next, be received as security for bank
circulation. This is a radical change in the
1.r,- L.
right they have heretofore had under the
law to puchase and deposit as security for
their circulation. any of the bonds ISSUED by
| the United States, and dcprvcs the bill
holder Of the best security which the banks
are able TO give 10y requiring them 10 de
poSit bonds having the least valUc of any
bonds issued by the Government. The
average rate of taxation Of capital employ
cd in banking is more than double the rate Of
taxation upon capital employed in other
legitimate business.
Under these circumstances - amend the
banking law 50 as To deprive the banks Of
the advantage of securing their notes by the
most valuable bonds issued by the Gov
crnment, will, it is believed. in Il large
part of the country he practical prohibit
tion of the organizing of new banks
and prevent the existing hanks from
TiiidrsinS tleir c;,l''i"- lhe national
panhihs system II continued ~ hl'
VIII ne monopoly III 'AG hiii.S "i th''Se
a,feauy ch53Seu III II VINO may purchase
Government n'i'ds bearing a more iiF9ranie
rl!c oi interest 'hah 'he " Pcr c"h' h"ndS
PRIOR 10 neNt July- 10 pfc'eht tic further
organization oi olnhS 10 lut IN Jeopardy
the whoie system by l.,lnS from II tlr'i tea
lure that makes H. is II now Is h!nNlns
system Tree upon the SiihG terms 10 al! Wha
Mish To engage III H. Even tir cNisiiA"
banks VIII he ~ cancer oi heinS uriIeh rom
business ny auGl!lohai IlSiIvaniaSes 10 Whth
| ihey VIII DC Suhjcclcu ny ms ON. III sh!rt'
| cannot oul rcSirH Inc nun Secii"h
OF thc Diii aS Il stcp IN lhc direction
oi inc obstruction "i thc national