The Democratic press. [volume] (Ravenna, O. [Ohio]) 1868-1901, 1886-12-09
The Best Form of Paper Money.

AS the opening of Congress draws
near, the newspapers friendly to the
national banks increase their clamor-
Gus demand that something shall be
done to perpetuate the national bank
circulation. 1t is generally acknowl-
edged that the Treasury, notwith-
standing the strenuous opposition it
made last winter to the Morrison res
olution, will do precisely what that
resolution would haye required it to
do in the way of calling bonds. and
that in the course of the next twelve
months the whole of the outstanding
three per cents will be called and paid,
leaving only the four and q halls and
the fours remaining. Even the four
and u halls will be due and payable in
1891, and then only the fours will re-
main available rs security, under the
present National Bank act, for circu-
Iating notes. The high premium upon
the fours reduces the net income from
them to less than two and half per
cent. per annum, and since out of this
income has to be paid the tax of one
per cent. upon the circulation, there
is little or no inducement for the banks
to buy aud deposit them. Bes des, the
fours will be subject to absorption for
the national sinking fund; and wilss
probably all be retired by purchase in
few more years. It is plain, there
fore, that some new plan will have to
be adopted if the circulation of the
national banks is to continue.
The subject is receiving considera-
ton not only from the partisans of
the banks, but also, we are told, from
the officials of the Treasury Depart
menT. AS yet no scheme likely to
be submitted to Congress has been
promulgated. Those which have been
put forward by irresponsible persons
are none of them worth serious con-
sideration. A bank circulation with
out security will never be tolerated by
the people of this country, and no
security yeSpropesed would be- accep-
table TO the banks.
But, as we have often reminded our
readers, there is no need of any bank
circulation at all. The national bank
system can live and thrive without it
and the country can very we'll dis
pense with it. The assertion 80 conf
IDENTIFY made in various quarters, that
national bank notes are the best form
of paper money that can be devised,
is an impudent falsehood. All that
makes them good any way is the fact
that they are secured by United States
bonds, and that they are equally cur.
rent in all parts of the country. In
respect both of security and of uni
versal currency, they are equslled by
Government notes, and these have
the additional advantage both of be
ing legal tenders and of costing the
nation nothing for interest. A green
back is no more nor less than q non
interest bearing Government bond,
and that it is, therefore, both safer
and cheaper than bank note, repre-
senting a portion of an interest bear
ing bond, needs no argument.
What the agents of the national
banks may not be able TO accomplish
in COngress,it is impossible to predict.
But that the people of this country
will permit themselves to be tricked
into paying the national banks so lit
tie as even one per cent. per annum
for paper money that they may have
for nothing, we are slow to believe
IN. Y. Sun.