The Washington bee., 1888-05-12
THE NATIONAL BANKING SYS
TEM-SHERMAN'S WORK
ITS SUPERIORITY OVER
ALL OTHER SYSTEMS
AMENDMENTS NEED
ED.

OOTn OI ln6 uoceSSlGleS Oh Tue WdF.-
still survives. 1t has accomplished
aud Is accomplishing the
threefold purposes of acting as
national fiscal agents, of furnishing
a currency for the people, and as
the best means yet devised OF re.
ceiving deposits, and making dis.
counts. This is So because of the
securities it affords for absolute
safety, and because all its oper.
ations are subject to periodical
examinations 10 guard against
insolvency, fraud, or wrong upon
all interested therein. No Dem
ocratic National Convention has
ventured to suggest al improve
ment or demand its obstruction.
But efforts have been made in Con.
gress by Democratic members to
secure the repeal of the ten per
cent prohibitOry tax Oh State Bank
circulation, thus to return to the
Estate Rights" system of local
bank issues, with all their evils,
snu other hostile Legislation has
often been proposed anu attempted.
These banks furnish a currency
from which no man ever did or can
lose a dollar while the Govern
ment survives aud maintains its
honor. The system is better than
the Bank OF England, or any other
established in any country since
the first banco was organized,
under the title of Chamber OF
Loans, in I'LL. The national
banks have furnished, and under
proper Legislation will continue to
furnish, a currency adequate for
all the wants of the country.
In securing the national banks
the craftsmanship of Mr.. Sherman
exceeds that of all those of all
nations through seven centuries OF
time, and Japan and other gov
ernments have certified to the yer.
ity of this by copying and adopting
his system.
But it must not be supposed the
system has ceased to require the
care of Congress, under the recon.
mendations of such able fnanciers
as Mr.. Sherman, In the last three
respects:
l. Taxation. The banks are
taxed, under State authority, high.
er than any other species of prop
erty. High taxation compels them
to keep up higher rate of discount
on loans than would be otherwise
charged. To add unnecessary
national taxation is alike unwise
; and unjust. On this subject Mr.
Sherman was reported in an inter
view as follows:
"Would you favor the abolition
of the tax on ba K circulation
"No, / would not, The tax used
to be two per cent. Then Con
gress, by Legislation, reduced il
one per cent. / would favor a re
duction of this tax to one half O.
one per cent, but 1 believe in keep
ing a tax"
{ With a conceded necessity fol
reduction of national taxation, wh!
should banks be made to suffer un
necessary burdens5
2. The amount of circulation
allowed on Government bond
deposited in the national treasur,
as secuity for circulation. The
only bonds now available are th,
four and four and-a-half pc
} cents. These command a pre-
: MUM of from twenty to twenty
f eight per cent. With only ninet.
f per cent of the par value Of thes'
8 now allowed to banks for circula
tion, it has ceased to be remunera
tive. Many banks have sold thei
> bonds and reduced their eircnla
; ton and if the price of bonds ad
vances there is danger of con
: traction of the currency prejudicia
!, to the business of the country. II
r the same interview above men
4 toned Mr.. Seerman is thus report