The Providence news. (Providence [R.I.]) 1891-1906, 1893-08-15
DEBT AND PRESERVES,

pie that the present ulSoruereu conul-
ton of the finances of the country is
due almost wholly to the fact that debts
are not being paid.
Business would move along its
accustomed ways in its accustomed
manner if debts were paid. There is
not business interest in this city today
that is not suffering for the money that
is due but not paid. There will
presently not be a person who does dot
suffer from the same cause.
Small businesses, that depend upon
receipts to enable them to pay their
obligations, are crippled because they
cannot make collections, they in turn
find it impossible to pay promptly, and
the embarrassment is passed along,
gaining OF losing in seriousness accord
to the condition and disposi ion of the
parties 1t touches.
This reluctance to pay extends to the
government itself, which insists upon
keeping lot of money locked up, under
the guise Of PRESERVES" sinking funds.
etc. The banks add enormously to the
difficulty of the situation by not only
keeping their lawful reserves intact but
by at present holding back curren cy
that they ought by all rules of fairness
to pay out.
What right has bank to refuse to
cash checks when there are funds in
its vaults that belong to the drawers?
Is it not palpable fraud to oblige
depositors to make use of checks that
are stamped payable only through
clearing house" and upon which cash
cannot be realized?
When the banks do that they are
simply refusing to pay their debts, and
are proclaimng to the world that they
are in effect unable to meet their obli-
cations. The difference between a
banks refusing to honor its promises to
pay because 1t has not the money to do
SO and refusing to pay because it fears
it may soon become unable to cash its
checks is one that is ethically exceed
ingly vague and that does not in the
least affect business.
The exigency has already ceased to
be desperate enough to justify the
longer withholding of currency by the
banks, If it has Mt any time been grave
enough to warrant it, What would be
thought of business house that insisted
upon keeping reserve of cash in it's
safe while it neglected to provide funds
for the pay roll of its employees merely
because it feared that some demand
might next week or next month be
made upon it? Such a practice would
be roundly condemned, and would re.
suit in serious trouble.
But how much more business-like is
the rule of the banks that forces deposit
tors to use their clearinghouse checks?
They are fraud, first upon the deposit
tor and next upon every person that
the unnatural and unnecessary exigence
of the times forces to accept them.
You buy groceries and you tell your
grocer that A. b or G bank owes you
SO much, cash deposited. If he is a
trusting or credulous person he may
believe you, and take your check that
cannot be turned into money, pass it
along to another, from whom it gradu-
ally travels to tho clearing house, where
it is started upon another stage Of its
career of sham and lying declaration OF
value that can not be made real.
II the banks would pay their debts, if
the government would pay its debts. if
corporations and individuals would pay
their debts, business would be good
enough and there would be money
enough. 1t is not so much con-
fidence" that Is needed as common
honesty and strict redemption of
promises to nay. Two-thirds of the
monetary and business troubles now are
due to wilful and stupid and criminal
refusal of debtors to meet their obliga-
tions.
The holding of reserves" by banks
and government when there is legiti.
mate Indebtedness that the reserves
could be used to liquidate, is as much
against public policy as the theft of cash
E.. -.