Evening star. [volume] (Washington, D.C.) 1854-1972, 1892-04-23

1 ERNMENT SAVINGS BANKS IN OTHER Coux-
| TRIEs--wHY orBEh BANKS WILL NOT BE d.
| JURED.
| Postmaster General Wanamaker's favorite
project is the establishment of postal
savings banks. He believes that the people of
this country would be glad of an opportunity
to deposit their boarded cash in the hands of tho
government. Before two Congresses ne has
urged the adoption of the plan Respecting
its details as he has formulated them, he spoke
freely few days ago in conversation with a
| representative OF The STAR.
"Ono reason why postal savings banks have
not hitherto been established in the United
States is that private banks have opposed the
scheme" he said. 'They have feared that
their business would be interfered with. As q
matter Of fact there is no foundation for such
| an apprehension, inasmuch as postal savings
| repositories would not antagonize nor take
away business from the private concerns. The
government would always pay a smaller rate of
! interest to depositors, and its customers would
be different class from those Of private saw
| ings banks. Whereas the latter handle large
sums Cor business men and have the custody
OF estates, trusts and the like, Uncle Sam
would deal with the comparatively Inconsid-
| cradle savings of the working people.
THE INVESTMENT OF THE FUNDS
another obstacle has been the lack of in
terest-bearing securities OF the government
| in which to invest the enormous sums that
| would be received on deposit A conservative
estimate has placed the amount which would
come into postal savings repositories. if they
| were established in this country at $500 co., 600,
which sum would probably be reached in less
than two years. This MONEY of course. could
not be locked up in vaults and thus withdrawn
from circulation. 1t must be made to
pay it, way, so to speak-to earn
interest for depositors and also to compensate
post office employees in wages for work they
wonid do in connection with handling it and
feeping records OF it. The most natural and
secure way of disposing Of these deposits would
be 10 invest shem IN government bonds. I'M
fortunately government bonds are rapidly dis
appearing; the last Of them will mature i'll
about sixteen years"
THE PUBLIC rAyoRs THE SCHEME
.How far does public sentiment favor this
scLeme?'
Public sentiment universally demands its
adoption" replied MIR. Wanamaker. THE
people are eager for chance TO deposit their
savings with the government. They feel that
Ill Uncle Sans hands their money would be
absolutely safe, whereas there il always pos
sibliity that the strongest private firm may
burst. Thousands and thousands of IndivId-
uals all over the United States who now hoard
distrust OF the private banks would rush i'm
medlately to give them into the keeping of the
government.
UNEQUAL DISTRIBUTION OF SAVINGS RANKS.
Another point should mention right here
Is the fact that private savings banks are dis
tributed very unequalIy over the country.
There are 647 mutual savings banks in the
Union, and all but eleven OF them are in the
New England and middle states. There are
HAL -
fOrty-two are in the southern states. which
section is provided with no mutual savings
banks at ALL While in New England the aver
age distance from the nearest savings bank to
the post Office, which may be assumed to be
the center OF any community, is ten miles, in
the southern states it is thirty shree miles, on
the Pacific slope ifty-two miles, in the middle
states twenty-five miles and in the western
states twenty-six miles"
IN oTHEn COUNTRIES.
"What grounds have private banks for fear
ing that their business would be damaged by
government savings repositories"
None whatever, if the experience of the
whole civilized world is to have any weight"
said the Postmaster General. IL have received
very interesting reports from all the countries
where successful government savings banks
are IN operation. These embrace France, Aus
tria, Italy, Belgium, Hungary, Sweden and the
Netherlands. They are unanimous in the
antagonism whatever between private
banks and those under government con-
troll, and that tile former have received no in
jury from the latter. On the contrary they de-
clare that the number Of private banks and the
amounts Of their deposits have incre ased, the
government drawing Its own custom from an
entirely different class OF patrons"
why do not private banks possess the con-
fidence of small depOsitors?"
Partly because In many of the states there
is no adequate state supervision. From the
best information l can get it seems that in
twenty six states of the Union. three terri
tories and the District OF Columbia no law
whatever exists III respect to private bank
that Is to say. any person or firm can un-
dertake the business OF private banking in
any OF those states or territories without
legal restriction of any sort and with
out supervision or control under the law. In
eight states and three territories reports of
condition nor examinations are required by
law OF banks Incorporated under state author
lty. The treasury reports show that prior to
OF private banking concerns were equal 10 the
total losses which had up TO that time occurred
under the national SYSTEM"
THE ATTENTION OF CONGRESS CALLED
'How far has this matter been brought to
the attention of Congress-" Mr.. Wanamaker
was asked.
Il made detailed argument on the subject
during the last session of Congress-" be re-
piled, ''and have Just addressed another to
Chairman Sawyer of the Senate post Office
Committee IN response to an inquiry from his
committee. In this have stated the best rea-
SONS known to me. which l regard conclu-
sive ones. why postal savings repositories
ought to be inaugurated. To these
have added the views on the same question
expressed by number OF my predecessors;
also table showing the attempted iegis-
lation in the matter, and, what is likely to be
of great value. a careful compilation OF the
essential details Of all existing foreign systems
describing their plans OF operation and ac-
companied by the personal comments of tho
CHER postal officers Of each country in reply to
certain queries which PROFOUND"
Mr.. wASAMAKERs PLAN.
"what is your plan in detail, Mr.. Wanna
makcr?"
Il advocate the adoption OF n system which
will readily adapt itself to the wants of the
people. My plan is to use cards, with spaces
for postage stamps to be affixed to them
the cards with stamps to be received in
lieu OF cash as deposits. In the abb
seuce OF government securities TO- investment
Qf the cash, suggest that the money be kept
in circulation and made to earn a low rate OF
| interest by lending the deposits received in
each state to the national banks of the
same state. The latter, of course would be
glad to pay low rate of interest to the gov
eminent, making their profits from the pre-
vailing higher rate. The savings deposits
/ a Il