Rock Island daily Argus., 1888-04-17
A PLEA FOR THE BANKS.
SENATOR FARWELI. WANTS THE MA
TloNAL BANKS PERPETUATED,

And Presents Plan by which His Ide,
May Be Accomplished-Thc House Give
the Extreme Silver Men Setback
O'Nen's Labor BiIIs-Three Pension We
toes and the Reasons Therefor.
| WASHINGTON CITY, April l7-In address
| ing the senate Monday ON the bill providing
for reduction of interest on the per cent,
bonds Farwell began by giving notice of twt
amendments that he proposed to the bill, The
first Of these directs the secretary Of the
treasury to issue and sell to national banks
United States ~ per cent bonds, redeema
ble after fifty years, at par. These bonds are
| to be used by the banks as security for their
| circulation, their notes to be issued to the full
par value OF the bonds 1t also directs the
secretary of the treasury to invest the sur
plus funds held in the treasury Including the
| amount to be received for these bonds in the
purchase of any United States bonds in open
| market, and IL repeals all the sinking fund
laws.
The other amendment authorizes the sec
| retary Of the treasury lin order to enable the
national banks 10 maintain and increase
their circulation and TO prevent the ultimate
destruction of the banks by the purchase or
payment of the national debit to receive from
the banks to secure their circulating notes.
state, county, or municipal bonds
(of the United States upon which
interest has been heretofore prompt
ly paid, and whose market value is
equal to or greater than their par value,
bearing interest at not less than per cent.
Such bonds, however, are not to be received
by the treasurer of the United States at more
than 10 per cent. of their par value, nor until
the approval of the secretary of the treasury,
the treasurer of the United States and the
comptroller of the treasury shall have been
indorsed upon them.
Farwell said he was in favor of the largest
possible bank circulation that was redoemable
in gold on demand. No circulation redeema-
BILE in that manner could he too large The
rapid decrease of national bank circulation
was due to the very large premium ON the
national bonds and their near maturity. The
banks could not afford to hold them with the
absolute certainty Of losing that large pre-
MUM. They therefore took them up with
United States notes, and released themselves
from the obligation of redeeming their notes.
For that reason the national bank circulation
had been reduced since 1882 from 1868, 900, 900
to about SlGO 0OO. 900, and the banks would be
compelled to retire the balance of their circu-
lation in u very short time, unless something
was done to prevent it. The country could
not afford to destroy the best banking system
ever devised. Under his amendment the
banks would have a new lease of life and
would be able to furnish the country with all
the circulating medium required, limited only
by the amount of the national debt
If it were desired that their permanent ex-
istence should be secured and the necessary
volume of currency furnished through them,
then authority should be given to them to
furnish other bonds as "A basis for circulation
according as the national debt was reduced
and retired. Without that authority as the
national debt was paid, the banks would be
compelled to give up the circulation secured
thereby and that circulation would, of course,
be destroyed
He would, if he had the power, pass law
now that would perpetuate the national bank
ing system. If the United States treasury
were like the Bank Of England possessing all
banking functions) it would not be necessary
to legislate about the currency or the surplus
of the government being deposited in the
bank of England the treasury of that nation)
was in active use for commercial purposes
Just as the $6l 100000 now deposited in the
national banks We're in active use for
business The money locked in the United
States treasury might as well be at the bot
tom of she sea for any good that it was to the
business of the country. Congress ought to
pay off the national debt, both bonds and
notes, and authorize the people, under the
national bank act, with suitable amendments,
to furnish themselves with all the money
needed The people will then furnish their
own circulating medium in such quantities
as the business of the country required, and
they would not be subject to any legislation by
congress nor have their interests menaced
and jeopardiZed as at present by deposit Of
$61 ,OO0,0G0 in the national banks subject to
the call of the secretary of the treasury. The
government should get out of business of all
kinds, and especially out of the money busi-
ness. 1t might as well go into any other
business us to continue in the oarTAnsS SaSi
ness.
He denied that there was any monopoliStic
feature about the national banks, and added
that the price of money was governed like
everything else--by the law of supply and
demand Where there was no bank it was
difficult to obtain money and only
at unequal and always high rates. He did
not believe in sumptuary laws, legal tender
laws nor usury laws.
Referring to the double standard he cunsid
cred it impossible to have two standards.
There ought to be but one standard. The
stamp of the government was simply n
certificate that it contained given quantity
in gold AS to the silver dollar the reason
it was taken was because the government
agreed to receive it for its dues, and because
it was believed that if the government did
not receive it in that manner it would event.
ually take it up at 100 cents in gold
VETOED THREE PENSION BILLS.