Morning journal and courier., 1893-12-09
TO REPEAL STATE BANK TAX.

tee on Banking and Currency Ha
 Submitted Hts Report. | WASHINGTON, Dec. S.-The sub commit tee of the committee on banking and cur rency, of which Mir. Cox, dem, of Tennss see, is chairman, Messrs. Springer of Ill nois, Warner of NewYork, Hall of Missouri and Henderson of Illinois, members, SD pointed to consider legislation relating t. the repeal of the 10 per cent. tsx on stat, banks to-day made the following report t the committee:
 Your sub committee, to which has beer | referred resolutions of state issuss and tn. repeal of the tax thereon, has had under consideration the various matters referred to it and reports progress; namely, that fl has adopted the following as the provision l al outline of the general features of bill which 1t proposes to draft and propose te you as a substitute for pending bills rela tive to It's subject:
 Sec. 1. The tax of 10 per cent. againsl state bank notes paid out and used as cur. rency is repealed.
 Sec. 3. Except as below provided, nc state bank notes, etc, shall be paid out and used as currency of the state of Issue except subject to penalty of 10 per cent each time paid out.
 alty would be generally collected any more than is the tax imposed by our present law, but rather that as fast as the prohibited notes came into the hands of responsible parties outside of state of issue the penalty on paying them out will cause them to be promptly returned for redemption and thus effectively kept within the state oi issue.
 Sec. 3. State bank notes may be paid oui and used as currency, outside of state ot their issus, on compliance with the follow. ing:
 [s) Blank notes to be furnished, and is sue to be registered by the comptroller oi the currency, and to be of sharply distinc- state bank notes, @ the state of their is sue, and (3) under which section of this act they are issued.
 (b) Benks issuing such notes to be sub. ject to inspection by the comptroller of the currency, similar to that now provided for national banks, but (except ss to be low) for purpose of public information only-the comptroller having no general supervision of the affairs of the bank.
 (c) Outstanding notes of each bank to be limited to 75 per cent. of paid-up and un- impaired capital.
 (d) State banknotes to be made by states of issue 8 first lien on all assets of issuing bank and liability against stockholders to an amount equal to their stock in ad- dition to 1t.
 fol An nf -ha1f to be paid on taking out circulation and also on all circulation outstanding more than year so long ss, and whenever nec- essary (s) to keep good guarantee fund of at least per cent. of outstanding circula- tion, for ultimate redemption of notes and (b) to meet expenses not covered by penalty receipts under section 2 above.
 Sec. 2. State bank notes may be paid out and used as currency outside of state of issue on compliance with (s) (b) fc) and (d) of section on deposit with the comp troller (ss security for ultimate redemp- tion of notes) of United States, state, mu- nicipal, etc., securities to amount of par of notes to be issued-the character of se- curities permitted to be strictly prescribed in this bill
 In connection with the foregoing outline six points may be noted:
 
 taxing power (for purposes other than rev. enue) is abandoned.
 Second, The federal intervention pro- vided Is based upon the admittedly con. stitutionsl right to regulate commerce be. tween the states.
 Third, the details of the federal duties prescribed are confined as nearly as may be to administrative functiyes correspond ing to the mintage of coin-the guarantee against fraudulent issue and the periodical testing of issuing bsnks-none of which materially interfere with the elasti ,ity of the currency or with the organization of the business of the banks which would be provided for by state law.
 Fourth, special redemption facilities are doubtless desirable. These, however, are matters of convenience and detail, rather than of principle, hence are reserved for later suggestion.
 Fifth, the privileges given ensure to na- tonal banks as we'll as state banks, but do not interfere with the present national bank currency.
 Sixth. the aims sought are, first, to free our bank note currency from federal con trol, as to leave 1t as elastic as possible and as promptly as may be available for legiti- mate local demands, and second, by thus relegating currency supply to local institu- tions under conditions which ensure an ample supply of sound currency to fore stall those demands for fiat money which are logical and actual consequence of the present system by which the federal government has assumed the exclusive duty of providing for our bank note cur rency.
 It must be understood that no member of the sub committee Is personally com mitted to any of these details and the sub committee Is not ready to make a final re- port, but simply and this statement for the information of the full committee and in the hope to profit by the discussion by it of these or other points.