The Jersey City news. (Jersey City [N.J.]) 1889-1906, 1893-08-23
Ignoring the Lessons of Current
History-Senator Voorhees, Speech.

History-Senator Voorhees, Speech.
Sepator Voorhees, is a monumental
example of the nianne in which even
brilliant men ignore the plain lessons
o~f-experience when their minds ar Q
given over to some pet doctrine or
theory. In the case of Senator Voor-
hees, the lesson that he shuts his eyes
to is not a mere matter of historic re-
cord. The Senator is not obliged to
go back to the days of his own youth
even. There is a tremendous warning
in the living present, in the events
passing under our very eyes from day
to day, and yet he has utterly failed
to observe it.
Senator Voorhees, is undoubtedly
right in his contention that the issue
of currency notes by State banks is
not repugnant to the Constitution.
The very fact that Congress resorts to
the device OF a prohibitory tax to
keep them out of circulation is a con
cession of the right to issue them.
The question is purely a practical
one. Is it expedient to permit their
issue? Will they afford a safe and
stable form of currency? Will their
use involve the people in loss, and
destroy public confidence?
To the first two questions, Senator
Voorhees, answers a~f1irmatively. He
speaks of the present efficient q
agement and thorough supervision of
State banks. He thinks the day gone
by when loss through the deprecia.
ton of a State banks paper was
among the possibilities. He talks a
great deal of high flown rhetoric
about the value of State and munich
pal bonds, and he has much to say
about the telegraph and telephone
bringing communities near togeth er;
but he fails to say n word about
the experiences of the last two
months.
To the ordinary mind, the bank
failures of the present crisis must set
tie the whole question. If to the dis
aster and panic caused by these down
falls were added the depreciation of
the bank currency, the total annihila-
ton of all value in a large part of it,
it is quite plain the disaster to the
country would be intensified ten-fold.
The national bank system has its
faults and its objections, but assuredly
at this time it has proved a blessing
and a safeguard, and has saved the
country from, perhaps. the worst fin
ancial collapse of history. 1t is plain
that no State bank circulation
could have resisted the strain
of the last few weeks. The runs
on the New York and other saw
ings banks may serve to show just
how far public confidence would have
been reposed in State bank paper, no
matter how backed up by the choicest
municipal and State securities and
guarded by the most elaborate system
of State laws. No plan could be de-
vised more thorough than that under
which New York savings banks are
protected, and yet it did not suffice to
insure complete faith in their solidity.
Even if the States should undertake
to guarantee the notes of their banks,
we doubt IL the security would suffice
to hold them at par in periods OF
trouble, and indeed we doubt if there
are more than six or seven States in
the Union whose guarantee would be
good for much in crises of the extreme
stringency OF the past few weeks.
Mr.. Voorhees, treats the proposition
as incredible that the United States
should perpetuate a national debt fol
the mere purpose of backing up Q
national bank circulation. There il
nothing Understandable in the idea
of doing so. European economists
are prone to regard a national debt as
a national strength just as much as 6
a national liability. The fabulous
debt of Great Britain has often beer
spoken of as one of the bulwarks o.
ING OfOVu anu OOuStltutAoAs AtOhEh
the enormous and wide spread con
Germ which it creates in the stability
of the government and the prosperity
OF the Empire. it is a constant bull
wark against revolution and a con,
slant incentive to patriotic duty. n
would be going somewhat far to SAY
that we have nothing to gain by per
petuating SO much of Jul debt a
may serve to back up a useful ant
convenient form of currency. in which
tho people have for many year
shown an unsuitable confidence.
We believe, at any rate, that a Stat
bank currency is full of danger to tn
public. If we must fall back on thu
States for currency, let them coin gole
and silver money. That will be Sc
cure enough, through its intrinsi
value; but tho indiscriminate circula
ton Of paper with only the State
guarantee behind it is sur to result
in trouble and confusion, and ma,