The Hawaiian gazette., 1884-06-04

snow, reduced TO profound obedience pro
vinces which had never submitted TO Ak
bars. authority and doled out monthly
pittance TO his heir" And the Hawaiian
Monarch in his little Iolani Palace had
better ponder on the fate of the Mogul En-
pire before signing the death warrant of
the liberties of this race and of himself.
AswE read the Bank Charter the security
offered for the paper currency is the prom
Use of the Hawaiian Government to pay in
20 years. In plain words the Hawaiian
Government borrow Of Dir. Spreckels and
his supporters one or two million dollars
which they spend, and Mr. S. & Co. de
post in the treasury as security for the
payment of their own notes, the promise
of the Hawaiian Government to pay them!
In the United States there is no trouble.
The treasury is always ready when Ma
tional Bank fails to pay out the cash re
CURED Our Hawaiian Treasury has no
such resources to fall back upon, by its
own statement it has run as low as even
two thousand dollars. Should a crash
come it would have nothing to offer to the
holders OF the Hawaiian National Bank
Notes but its own promises TO pay. to be
sold for what they might be worth, and on
the failure of that bank those securities
would be worth very little. There Is no
cash behind the scheme: it is specious we
acknowledge, but it is dangerous, and no
small nation can play with such an edged
tool as the paper currency of bank backed
by promise to pay Of a lettering govern
ment and hope for anything but disaster.
A Niger in the fenceI The proposed
bank charter says in lieu of all taxes etc,
the Hawaiian National Bank shall pay or
cause to be paidinto the treasury annually
tax Of one per centum on the average
amount of circulating notes delivered to
said bank. and outstanding, according to
the records of the Treasury Department. .
The United States law reads.''a duty of
one half per centum each half year upon
the average amount of its notes in cirtu-
lation, and a duty of one quarter of one
per centum each half year upon the aver
age amount Of its deposits, and duty OF
one quarter of one per centum each half
year on the average amount Of its capital
stock, beyond the amount invested in
United States banks" These are two very
different things, and yet the furtherers OF
this precious scheme dare to say that their
fimsy ill-drawn paper scheme Is the same
as the United States National Bank Act
The United States protected their citizens
the proposed scheme allows the new banl
to escape taxation entirely if it is so dis
posed. Why should not the bank with
draw its notes Just before the tax time.
And where would be the tax then? Ii
the Golfers of the bank and not of those ol
the people.
In ZIG a smart and clever Scotchmar
named John Law got the ear of the Re
gent of France, and upon the following
argument started royal bank of deposit
and discount: "Gold and silver" said Law
''haye no real value and cannot be increased
at pleasure. If. then. this value can b,
transferred TO paper, which can be ISSUED
to any desired amount, the national wealth
can be increased" France was flooded
with shin-plasters, bogus trading com
pany was added to the bank, all the hare
coin came into the hands of the Govern
ment, which, with this at its command
could push forward all kinds of schemes
There was regular boom; enormous for
tunes were made, the shares of the banl
and company rose to a gigantic price, ant
then, in 1920, the bubble burst. Franco
was left with debt of 625.000,000 francs
thousands were ruined, and Law, barely
escaping with his life, died beggar il
Venice
There is some similarity between Law.
scheme and the Hawaiian National Banl
scheme. The coin is paid to the Govern
ment; is spent by them. The bank cal
start with million Of shin-plaster,
and not dollar of coin in it
vaults As long as the coin last
the Government will be strong. There i
every prospect of shin-plaster boom anC
evey prospect of a collapse which Will ruin
hundreds of individuals and will dash til,
Independence of Hawaii to the ground
A few beggars, heap of shin-plasters anC
an empty city is all that will remain o
Honolulu when that day comes.