Los Angeles herald., 1892-04-03
LETTER BAG.
Judge widney Arraigned-The National
Banks Scored.

Judge Widney Arraigned-The National
Banks Scored.
EDITORS HERALD: 1t is probable that
very few intelligent persons read Judge
Widney's circumscribed literary produc
ton in the Times OF Monday without
permitting sarcastic smile to sweep
over the face, such smile as is usually
provoked by the serious ridiculous.
The pointless production exhibits the
judge in the light of partisan with per.
sonal interests to subserve, and portrays
a dense ignorance OF human nature, po'
litical economy, monetary matters and
the aims and objects of financial reform
ers. I know very little of some of the
wild vagaries, hopeless and unreasonable
schemes proposed and advocated by hare
Drained, irresponsible individual mem
bers of the Alliance, and care less but
I do know and understand the "doc-
trines," teachings and principles of the
intelligent, determined, radical, uncom-
promising financial reformers.
The Judge seeks to leave the impress
sion upon the minds of his readers that
all monetary reformers, the Alliance in
cluded, propose to destroy all banks.
They propose nothing of the kind. But
they all do propose that all banks of
issue (national banks) shall be wiped
out of existence. And why?
70 perpetuate the present national
banking system presupposes& perpetual
bonded debt, because the system is
based on government bonds. They are
legal monstrosities, deceptive in name,
merciless in practice, far-reaching in
influence, false in pretensions, and a
menace to industrial and national pros
perity. The system is the creature of
the most despicable class legislation
ever conceived in the brain of selfish
plunderers. The system is little short
of licensed robbery.
To illustrate: Five or six persons in
vest 100000 in government bonds, de-
posit the bonds in the hands of a
government officer and receive charter
converting" them into national"
bank. The government furnishes them
80 per cent of the face of the bonds so
deposited in blank national bank cur
rency, which when signed by the presi-
dent and cashier of the bank, becomes
circulating medium-not money, but a
bastard monetary myth. The bank
receives the interest on the bonds de-
posted to "secure" their circulation,
and its currency" goes into circulation
only through the hands of borrowers.
So that the five or six persons with the
100000, by incorporating themselves
into national" bank, are enabled to
receive interest on the full face of the
bonds from the government, and have
80 per cent of the face of the bonds In
sspotinno1 ho,,1 0r1rroncx,;t f0 1ooY, 70
private persons. If the act of incorpora-
tion adds only to the name and nothing
in value or security, and such institu-
tions are good things, why not make the
law general; let the bonds be issued in
smaller denominations. say $40, 500,
ETC. authorize the owner to deposit the
bond with the comptroller of the cur
rency, receive 80 per cent of its face in
currency to use or loan, and at the same
time draw interest on the bond.
National bank! The name is de-
ceptive. The only things national"
about the institutions are the bonds,
blank paper and the charter by virtue
of which they are enabled to fleece the
community in their merciless pursuit of
interest. There is danger in the infu-
ence welded by them in politics, in
commerce, enterprise and national pros
perity. With great pretention the high
sounding name is fourished, leading
the public to believe that national
banks are perfectly safe, and many are
deceived. Such banks are no safer than
state or private banks. The source of
the charter is nothing, the charter is
nothing, the system is nothing, the cost
of vaults and safes less than nothing.
Unless an honest man keeps the books
and carries the keys depositors are
liable to lose their money. The rate of
interest exacted and our monstrous
banking system enables the banks to
control the volume of our circulating
medium and by q cunning expansion
and contraction dictate the wages of
labor, the output of the factory, limit
production, producing spurts of pros
perity and periodical panics as may
seem most profitable, thus continually
menacing industrial and national pros
perity.
From the judges article his readers
would conclude that banks were organ
lied for two purposes 'Short time
loans" and to provide safes and vaults
to prevent robbery. Here is a better
definition: Corporations, artificial per-
sons organized for the purpose of pro-
viding two or three persons with soft
positions and fat salaries, who, by their
commanding gall and conscienceless
shrewdness, manage to loan other peo-
ple's money at exacting rates OF interest
and divide the spoils, less the salaries,
among the stockholders, without the
owners ever detecting their ''fnancier-
ing"
Look at the judges "fnanciering"
philosophy: Had it not been for the
banks collecting the revenue
money and loaning it to the community
the whole country would today be finan-
cially paralyzed." According to that,
the more we tax and collect off the peo-
pie and loan to the community the less
danger of financial paralysis. That is a
Republican idea as exemplifed in their
banking, appropriation and tariff laws
as thew now stand.
There is no mystery and but little
science in banking, and we fail to see
the necessity of placing this particular
species of private business under the
fostering care of the state and nation in
preference to any other private business.
K. T. STONE.
Ontario, April I'd.