Watertown republican. [volume] (Watertown, Wis.) 1860-1906, 1892-10-19
CURRENCY AND TARIFF
WILDCAT MONEY WORSE THAN
CREENBACkS.
Two Opinions of State Bank Issues
Prices of Farm ITnplem ents-An Echo
from LiverpoOI-CIaveland and the
American WorkinGman.

American WorkinEman.
The V!ciousness of the State Bank Cur
rency.
Every citizen of Wisconsin who desires
TO vote inteliigently at the coming election
should road the admirable exposition Of the
evils or Wildcat money, by IL. II. Camp, or
this city, which appears elsewhere in this
issue or the Wisconsin. Mr.. Camp is one
OF the foremost authorities in the North
west on financial subjects. He is not a
partisan, and at the time this address was
Urltten-mOre than thirteen years ago
there was no expectation that the revival
OF the old state bank currency would be-
come q political issue. His address was
read before a convention of bankers and
is a careful statement by a business man
and tlnancIer to business men and imam
GERS, OF the facts regarding the workings
or the old state bank currency system In
this part Of the country.
From advance sheets OF an official report
now IN course of preparation by the comp
tr0ller of the currency, in response to
congressional request for information on
the subject, the following, corrOborating
and experimenting Mr.. Camps review of
the history of state bank currency in this
section, is extracted:
On June 80 1888, the combined total bank
note clrculstion Of the states of Illinois and
Wisconsin, all of which stood at discount of
9 per cent amounted to 50 l9S 000 and it
protected by specie reserve of only 81 Isl, 900.
The total discount on the entire circulation
amounted to more than $500, 900 at per cent.
and the discount had to be paid by note hold
ers as often as they paid out note OF either
state
a Washington correspondent, after
studying this report, writes:
In July, 1859. convention of Wisconsin
bankers held at Milwaukee fixed the discount
on illinois bank notes at per cent. until Sep
tember ~, and 8 per cent. thereafter-wh1ch
was the rate imposed by Illinois banks on the
notes of Wisconsin banks. This action IL
Illustrates another Of the beauties of the ''sys-
tenn to which the Democratic platform de-
clares the country must return. like il
diana banks, taken in April, 1889, when they
determined to throw out the notes of all
Illinois and Wisconsin banks. At that time
the estimated circulation of Illinois banks
amounted to S., COO 000 and that OF Wisconsin
banks to s., 900 This action was justified
on the ground that many of the banks were
points, making the cost and difficulties of
redemption heavy, and that the Chicago banks
Disseminated against the Indiana banks.
Many people who do not remember the
history which Mr.. Camp and the comp
trOller of the currency so wildly set forth
think that the loss of notehOlders by the
collapse of unSOUnd banks Will be all the
evil that would result from the re-eStab-
IShment of state banks as banks OF issue.
This IS mistake. Even if the state banks
were good. there would be a heavy tax
upon the business Of the country repre-
scented by the cost of exchange. With
national currency, man who makes q
purchase III New \ Ork or elsewhere out
side OF the state can use his money at its
face value; but II state currency were in
vogue, a Wisconsin,. man making pur-
chaSeS in New York would find MS Wis
c0nSin money subject to discount. has
been estimated that the loss by discounts
which would be entaiied upon the business
OF the county II state bank currency were
revived would be SI00.000,0G0 per annum.
This Is only part Of the utterly useless
tax that the vicious Democratic financial
policy would infIct upon the people. Ere
quent failures, periodical panics the
Suspension OF payments anu the utter
decentralization OF buSineSS-theSe would
be the natural and necessary outcome Of
The policy supported by tie party of re-
frenchment and reform, represented by
John l.. Mitchell aud Grover Cleveland
EUening Wisconsin.
Safe Banks Wor~- Than Gr-enDacg<Is1n.
Business men will not fail to see that the
banking system ROW proposed TO the cOun-
Try by the Chicago convention would. If
adopted, prove worse financial affection
than the HO0GlnG OF the country with
greenbacks, which SO large a portion of
that party recently favored. For Of green
backs 1t could be said that they would
the Old system 0f ate banks should be re-
yiVed they would soon become, as they did
before. 4 SlWCcWay for pouring over the
country flood Of notes without proper
security. All would not be So but there
would tie millions OF unprotected or only
partially secured money III circulation.
President HARRISON, III his letter or &C
ccptance. wildly recalled the condition of
affairs when the old system OF state banks
was IL It's balefUl prime. The postmaster
general, III communication to the last
Congress, presented some startling SIatiS-
ties on the failures OF private banks, which
become or m0mentOuS interest since the
Democrats have announced it TO be their
policy to remove all restrictions upon the
circulation Of state banks. The pOStmaS-
ter-general says:
THAT private banking institutions do
NO afford adequate security to depOSltOrS
is most clearly demonstrated by the staff S.
tics at the command of the government,
showing the failure Of private banking
firms and contrasting these failures IN their
extent and effect with the losses incurred
through the insolvency OF national banks.
These statistics are comparatively limited,
but. such as they are they constitute such
strong proof Of miSmanagcment and reck-
IeSSueSS Of concerns free from adequate
governmental or state restraint as TO FUR
nlSh the best evidence upon the point de-
sired in this discussion to be emphasized.
FROM the beginning or the national
banking system until 1879, a period of SIX
teen years, only eighty-one national banks
had become insolVent, and the estimated
losses all told were S., $40, 189. 1t Is stated
in the publications the subject that fifty
i've banks, operating under systems in
vogue prior to the national banking SyS-
TEN. failed in the single year 1871. with an
aggregate capital OF over S67, 600, GOD. And
it is also recorded that IN nearly every in
stance the entire capital OF the banks
which failed was lost. The losses incl
dent to three or four. failures of private
banking firms prior to 1879 were equal to
the total losses which had up to that time
occurred under the national banking SyS-
TEN. During three years ending January
|. 1879, the failures of state and savings
banks and private banks in twenty-three
states numbered 2l0, with losses amount
ing to $50, SIC Gel.
The average annual losses to creditors
by the insolvency of national banks dur
ing sixteen years prior TO 1879 was $500, 012
while that OccaSIOned by the failure of
banks other than national was for three
years prior to 1879 not less than S10872 200
per annum. The report of the comptroller
of the currency for 1879 shows that III the
states Of Ohio and Illinois alone the losses
in three years through the failure of state
IoY, ho,,