The Colfax chronicle. [volume] (Colfax, Grant Parish, La.) 1877-1981, 1890-09-06

Now that their duplicity has
been exposed, we wonder what new
fake the demagogues are going te
hatch up, in place of the old cry
about the government lending
money to the bankers and whisky
men. In order that our farmers
may understand the position of the
government in relation to the ma
tional banks and the bonded ware
houses, we publish below two ex-
tracts, one from the Telegraph
Bulletin, the other from the Times
Democrat, which are concise and
excellent statements of the subject
in very few words:
| NATIONAL BANKS.
A party of gentlemen desiring to erect
themselves into corporation, under the
provisions of the national banking act,
must apply in the customary and pre-
scribed way to the treasury department
Among other things, and this is the point
in question, they are required to go into
the market and buy the bonds of the
United States, which are always at pre-
MUM. Upon depositing these bonds
with the proper authorities. the bank 30
organized receives from the Treasury de-
partment bank notes amounting to 90
per centum, not of the value of the bonds
bought in the open market. but Of their
face value. This was scheme of finance
devised by the government, at a time
when its integrity and very existence
was In peril, and to meet the emergencies
of the most calamitous and disastrous
civil war OF modern times. It's purposes
were two-fold, first in the interest OF the
government, to enforce domestic credit
and create market for its bonds, and
secondly, in the interest of the people, to
supply a sound and stable currency.
What IS the impulse that leads men who
desire to invest their money in the bank
ing business, to incorporate under the
federal law? Is it because of the intrinsic
merits and advantages of the system? Is
it because the national banks are so-called
pets OF the governments By no means.
1t is because OF the added confidence of !
the public in banks chartered under feder-
al authority. 1t is because people who
deal with the banks are re assured by the |
rigid supervision and inspections Of the |
federal government, and because in case !
OF misfortune or fraud the government |
assumes the right and duty of winding I'D |
the affairs of insolvent banks The safe |
guards thrown around these banks by /
the strict and parental surveillance OF |
the government render them the safest |
fr-fr0
ment for the benefit Of people, safe for |
investment, and safe as repositories of a
country's surplus, and accomplishing with
unapproachabie success the two-fold OBJ
jects of the system.
BONDED WAREHOUSES.
The object of the bonded warehouse
system used by distilles is merely to sus-
pond the payment of the internal revenue
tax on thor whisky until it can be sold in
market The warehouses are built BY
the distillers at their own expense. under
regulations prescribed by the Commits
sioner of Internal Revenue. They are in
the joint custody Of the government store
keeper and the distillers. When dis
hller enters his goods in the warehouse
he must furnish solvent bond in an
equal to the internal revenue tax
On the whisky to be stored. This bond |
relieves him of the requirement to pay
bis tax Immediately, giving him a margin
II three years for its payment, If he SO !
iesires, but the tax must be paid when the
Whisky is taken out. This plan, as stated
lbove, is rescrted to by distillers, when
hey wish to withhold their whisky from ,
he market for time, during which, il
he market does not justify sale, the {
whisky will. at least. be improved in value
" age, and they will not lose the interest
n idle capital paid in taxes ON goods
which cannot be proftably sold. The
does not advance cent on I
7hisky In bond, but simply suspends the 1
objection OF the revenue tax for specified
lme. Ii it bears any marked resemblance
the proposed alliance sub-treasury plan, a
ne fact Is not very apparent, except to
be "glass eyes, OF politician. .
These are the two systems that l
re SO glibly cited to show by way 3
{ comparison the constifutioaalify $
the sub-treasury or farmers r
arehouse project. We will not 9
effect upon the intelligence of our o
saders by pointing out the dis v
milarity of these schemes. The t.
ational bank and bonded ware u
ouse systems may or may not be a
Zisting evils, and it is all right to b
smand their abolition or radical W
lange, but they certainly cannot h
, used to bolster and uphold the d
'mmunistic sub-treasury fallacy. al
-->.>- &C