Fort Worth gazette. [volume] (Fort Worth, Tex.) 1891-1898, 1893-04-02
STATE BANKS,
A Texan Writes in Favor Vt State Banks
Without Power OF
Issue.

II seems little singular 20 me that
many people denOuncv anything Ike re-
strictiye legislation upon railroads. deal
ings IN options aud other enterprise,
and yet favor absolute prohibition of
corporate banking under the laws Of the
state. While IL may be answered that
the federal government supplies us with
n banking law superior to anything the
state could provide Is Il not wrong in
principle 10 maintain n constitutional in
terdict against q useful and honorable
VocationI Other and older states accm
TO 40 view It. for they permit the in
corporation Of banks of deposit diacount
and exchange. and nothing but the federal
tax of 10 per cent Ia many of them pre-
vents the existence Of banks of issue, and
the record OF these state banks In recent
years win compare very fayoI7lbly with
the national banks.
The commerce Of today impemtively
demands all possible banking facilities
and 20 charge upon the advocates of
state banks desire 10 return 10 tho old
wildcat system of unte-bellum days ~
lihel upon their intelligence. To my
mind the continuance Of the constitution
nj prohibition against corporate banking
per sc is indcfensible.
To establish banks with power 10 crit
bills of credit h quite another question.
but hardly the bugaboo many seeu dis
posed TO make Il. II congress will pro-
vide d sufficient amount of money for
the needs of the whole country aud the
tariff and other laws are so adjuostd that
a fair pro rata can be maintained In all
Of the states, ] for one favor nothing
buta national turrendcy. But II indeed
the powers that be continue the policy of
automatic druught of the circulating me
dunn TO the money centers. returnablc
90 the people once a year nt heavy cX-
L. q Id .NttHa
and again transported i am IN favor Of
safe, elastic state bank currency. Aud
10 the end that either course may be
adopted by the state Of Texas. / think
Il would be wise for the legislature TO
submit TO a vote Of the people an amend
ment TO the constitution permitting the
incorporation of banks Of deposit, discount
and exchange, but without power 10
issue bills Of credit except by special net
of the legislature, which should also
specify the securities to be deposited,
regulate the banks and superntend the
issues OF currency, which should be uni
form, and of the finest mechanical skill
obtainable 10 prevent CONTRIBUTING.
State banks OF issue are impossible with
the present federal tax against them.
but of course the gentlemen who so clam
Orously Endorsed every line of the Chi
cago PLATFORM stand pledged 10 remove
that tax.
Do not banks even now issue bills of
credit which practically circulate as mon
cy, independent of what IL known as
national bank currency
i have issued bills of exchange which
for months remained unpaid and finally
came In plastered over with transfer In
dorsements, Look at the reports Of ma
tional banks and see the aggregate Of
cashiers checks outstanding" which
are nothing but bills based upon the cred
IL Of the banks. In neither case does
the federal government assume one pnr-
ticle Of responsibility. The same may be
said of demand and time certificates Of
deposit These issues are all subject 10
discount az certain times and places. aud
] Relieve IN the absence Of an absolute
guarantee on the part of the state, the
notes of state banks properly secured
would pass at about the value Of their
bills of exchange away from homei ncy-
ertheleas IL a greater volume Of curren-
cy would promote the commercial and
general welfare Of the people the medium
Of state banks could be invoked and with
safety.
Summing up the situation % II az
pears 10 me, banks of deposit, discount
aud exchange should be permitted 90 In
corporate under the laws OF the state,
but should not be permitted 10 issue
notes 10 circulate as money without ex-
press legislative enactment 1t is all
very well IN the way Of amusement 10
discredit the acts and wisdom OF sue
ceeding Legislature 3; but after all, they
represent the people who elect them and
constitute the law-naking power Of our
form Of government and, nOlens volens,
we must either accept their act or change
our form Of governments ~ II. J4Ongnian
IN American Banker.