Richmond dispatch. [volume] (Richmond, Va.) 1884-1903, 1892-07-09
Banking Sysfems.

Somebody has marked and sent to us for
our consideration an article in the New
York Journal Of Commerce which favors the
divorce OF the government from the banks.
We would like 10 see banking system
better than our present one introduced
into this country, and we have often IA
vored a system which would be real
banking system and not system depend
ent upon the government for its notes of
issue. BY the way. in the article OF the
Journal of Commerce TO which our atten-
tion has been called Is suggestive state
ment--namely, that there is no spot
within our territory whore bank could
hide away from the ubiquitous express,
and If the old scheme was revived re-
demption would be forced upon it every
secular day in the year."
Who is to pay the charges OF the "ubi-
quitous express" for forcing redemption
upon the country banks? Who wants
banks that would have TO be compelled to
redeem their notesy We are amazed that
the Journal Of Commerce should counte-
nance such wildcat banking. That ex-
cellent paper has allowed its States rights
doctrines to blind it to the facts of the
case and to the real questions involved in
this discussion.
And what is the use of establishing o
catd-castle system of banking! What
wisdom would there be in calling in all
government issues in time of peace and
re-establishing the old State-bank system
only 10 provide that at the first blast OF
war our castle should come tumbling
down upon our heads aud the country
flooded with greenbacks or Treasury
notes! In fact. the old State bank system
has lncurablo defects. 1t bears within its
own body the seeds of dissolution. What
the people most need and what they enjoy
IN the existing system is a currency good
everywhere IN the land-a currency
which Is recognized as good not
only by bankers, brokers, and OK
perts III finance, but by the common
people. A local currency can never be
recommended 10 the whole people of the
republic. To name such currency Is to
point out wherein it fails TO meet not
only the requirements of the business
world. hut the demands Of the general
public. The ubiquitous express" Thomp-
sons Bank-Note Reporter, counterfeit de-
tcctors. Isis OF broEen. Insolvent, and
non-specic-paying banks-these things
have all been given 70 the moles and the
bats. and we hope never again or
see them brought into use. Forced re-
demption Is no redemption at all. The
people have no time and no inclination
70 engage IN such work. The fact
Is that the notes of these forced-redemp
ton banks are always put out rs far from
home rs possible and into the hands of "a
many people a. possible. One man has a
five-doliar bill in his pocket redeemaole
nomnally at one of the wildcat banks,
but he cannot afford 10 60 the bank IN
quest of his money nor TO waste time IN en-
deavorfng TO secure II by other means.
What IL he to do: We answer that he
would sell il to the brokers, as was the
custom III olden times, when under the
State-bank system Virginia bank-notes
were at discount even IN Baltimore.
The Federal Government pays interest
upon its bonds, and these are usedin bank
ing. Yes; but re-establish State banks
and you will have 10 do the same thing
under another name. just as was done un-
der the old State-bank system when the
State banks were allowed to issue SO in
their own notes for every dollar of silver
OF gold in their vaults. So they drew in
terest upon nothing-literally upon no.
thing-whereas the present national banks
must deposit government bonds paid for
out of their own pockets. and draw only
such interest as any other holder of the
bonds would draw, whether he was farmer
or banker OF broker. The government
insures us q good, redeemable currency.
The old system insured specie-paymentsi in
good times, but none when the specie was
most needed.
We ask our New York contemporary to
think twice" before it again advocates
banking system which would not benefit
ANY body but money changers.