The Seattle post-intelligencer. [volume] (Seattle, Wash. Terr. [Wash.]) 1888-1914, 1893-09-25


Tbs United States senste is proving IL
self not only an obstructive body. but Is Is
most prolific breeder OF currency intia-
tion schemes. which are offered as amend
meats 70 the silver repeal law. All these
so-cslled compromises have family re-
sembIanee, viz They are all quite as bad
as the Sherman law. and the majority OF
them are good deal worse.
The objection TO the Sherman law lies in
the issue OF the legal tenders required In
payment for the silver bullion purchased.
These legal tenders are redeemable in gold
on demand nj the treasury. The addition
OF si2B, J00. 900 of these notes in less than
three years to the other gold obligations
Of the treasury eventually began TO de-
plete its gold reserve. The creation OF
these notes is s,ii going on, and yet when
IL Is proposed to repesl this act the
'compromisers" ia the senate propose all
sorts Of imitation schemes as amendments.
Even Secretary Carlisle. il is reported. de-
sfres to create paper money in some form
to represent the difference between the
bullion value and the coming value of the
silver heretofore purchased in compliance
with the provisions Of the Sherman act
and now in the treasury vaults. This diff
ference. called "seniorage." is computed
TO amount 70 abort s50.o0o. 900. and if it is
utilized as proposed it will bring the total
Of the notes issued under the Sherman act
up 10 round $500. coo. 600, and that of our
silver legal tender currency up TO very
nearly 500. 10000
Ii the measure raising the limit Of ma
tionai bank circulation Is enacted IL would
produce an increase of national bank cir
culation of SO. 400. 0D0 The circulation on
the % per cent. basis has already been in
creased about $4,000, 600 since February
by the action of the banks in depositing
bonds for additional notes, and IL will
probably be further increased this month
in the same way by about 100000. Ii,
therefore, the proposed measure becomes a
law our national bank currency will soon
be Sol, 10000 more than Ii was last Feb
ruary.
II the present prohibitory Federal tax
of 10 per cent. on the circulation of state
banks is repealed We shall have an enor-
nous imitation. IL Is quite likely this
measure will be enacted. but IL will be
difficult 70 surround state banking with
proper safeguards for the people Con-
gress has no constitutional power TO legis-
late for state banks; 1t taxes their circula-
ton rs a revenue measure just as IL taxes
oleomargarine; but congress can not allow
the circulation of some state banks to be
exempt from taxation while the circula-
ton of other banks is taxed. nor can the
Federal government supervise banks in
corporated under state laws.
The financial editor of the New York
Sun. Matthew Marshall, says on this
point:
THE United States has no more control
over the operations OF state banging cor
poratfons than il has over those of state
manufacturing. railroad or any other kind
OF corporations. The interstate commerce
act expressly avoids meddling with trans
portation within state limits, aud q ma
tional currency act would have 10 show
the same respect 10 institutions chartered
under state laws and doing business
within state boundaries. II, therefore,
the present tax on state bank circulation
IL to be taken off at all il must be taken off
Internationally. and what would follow
in the way of currency imitation no one
can exactly predict That IL would be
small in the older and more conservative
states Is highly probable, but IL is equally
probable that in the newer states and those
less we'll provided with banking facilities,
il would be something enormous. The
circulation of our 8, ass national banks,
under all the burdens and restrictions i'm
posed upon IL. is now over 500. 600 900. and
u IS moderate estimate TO put that which
would be created by state banks in the
West and Southwest. under the facilities
which would doubtless be afforded for it,
ut not less than an equal amount"
The sherman act is harmless compared
with cariisie's coinage scheme, which is
nothing but more Eat or phantom money,
or with the repeal of the tax on state bank
circulation. The devil we have today Is
imitation; we do not want more of that
kind of devil but less. The secretary OF
the treasury does not need to propose fur
Their imitation of the currency at the very
moment when he is begging for the repeal
Of the Sherman law because 1t is PER-
nicious act which depletes our gold and
initiates our paper currency. The sscre-
tary of the treasury can borrow all the
money he transiently needs on treasury
certificates of Indebtedness. bearing inter
est say at4 per cent, and payable two,
three or four years from date and redeem
able after one year