The morning news. [volume] (Savannah, Ga.) 1887-1900, 1894-11-20
The Baltimore Plan.

T REFORM great 4edl OF dlArHIou u DC
ing given TO what is called the "Bslti-
more plan" That plan, as briefly stated
10y the Mail and Express. provides as fol
+ lows:
/ l. The repeal OF the existing national
bank act requiring the deposit OF bonds
. to secure circulation.
. To permit the issue Of circulating
notes by banks to the amount Of 70 per
cent. of their paid up capital, 50 per cent.
OF which TO be- subject to a tax of one-half
. Of ] per cent. upon the average amount of
circulation. she other . per cent. to be
subject both To- the tax OF one-haf Of L
per cent and 10 ali additional heavy tax.
This additional - per cent. is to be known
as emergency circulation"
8. The tax OF one-half / per cent. is to
be paid TO the treasury Of the United
States as fund out of which the ex-
penses of the controller Of the currency,
the printing of circulating notes, etc,
shall bee betrayed The tax in excess of the
one-half 1 Per cent to be imposed upon
the emergency circulation" is to be paid
into a guarantee fund" This guarantee
=
per cent upon the amount of circulation
received the first year. Thereafter d tax
of one-half ] per cent. is to be imposed
upon the average amount Of outstanding
circulation until it shall equal per cent.
OF the entire circulation outstanding,
when such tax shall be suspended, to be
resumed when deemed necessary.
be redeemed by the treasurer of the Uni
ted States out Of the guarantee fund"
if 1t shall be sufficient; if not, then out
of any money in the treasury, the same
to be reimbursed out of the guarantee
fund" when repIenished either from the
assets of the failed banks or from the tax
above mentioned.
g. The banks issuing circulation are to
deposit and maintain with the treasurer
of the United States a redemption fund"
equal to per cent. of their average out
standing circulation, as provided for I'M
der the existing law.
o. The government shall have a prior
lien upon the assets Of failed banks and
upon the liability of shareholders. This
is for the purpose Of restoring the amount
withdrawn from the. guarantee fund" for
the redemption of its circulation. The
amount thus claimed is not to exceed the
amount of the failed banks circulation
after deducting the sum to it's credit in
the redemption fund"
We stated sometime ago that it was
probable that objections would be made
to the Baltimore plan" Mr.. Charles G
Homer. when he submitted 1t to the
bankers convention at Baltimore, said
that it was not completed plan, but
simply an outline of desirable legislation,
embodying the underlying principles ne
cessary for the creation Of a safe and
elastic currency"
Among financiers the idea prevails that
the currency Of the country must he pro-
vided by the banks and not by the govern
ment When the government furnishes the
currency elasticity cannot be secured
neither can elasticity be secured under
the present national banking system,
which provides a currency based upon
bonds. a recognized authority in finance
stated recently that mo note system tied
to a bond and not to commerce" can be
flexible and elastic. Assuming that this
is true, and that elasticity is highly de-
sirable quality in our currency, no state
banking system based upon state, county
or municipal bonds, would be So. sfactory.
, 1t would not be any more satisfactory than
is the national banking system, based as
/ it is upon government bonds.
The banks are the first to feel any dis
| turbance in the business conditions of the
/ country. The hand of the banker is con-
/ stantly on the pulse of commerce He
! ought to know and does know when more
/ currency is needed and if the bank were
/ given the power to issue currency as pro-
vided in the Baltimore PLAN" he would
respond promptly to the demand And,
according to that plan, he would be forced
to withdraw currency when it was not
needed.
The circulating notes, under the "Balti-
more plan" would be amply secured, but
| stockholders and depositors might not
fare so well as under the national banking
law. However, it is the duty of stockhold-
ers to look out for their own interests by
putting capable men in charge of the
banks, and the character of the men in
charge of bank is the basis of the con-
hdence of depositors.
We give brief outline of the "Balti-
. more plan" for the reason mainly, that
our readers may become familiar with
its leading features. The plan, doubtless
will be thoroughly discussed at the APP
preaching session of congress
The New Orleans Picayune calls at.
tention to the fact that while sundry
/ persons are estimating the current cotton
crop at exceeding 10,ooO.00O bales. the
amount of the crop which has come into
sight up to the present is almost Identical
ly the same as came into sisht up to cor
responding dates in 1891. the year of the
100000 bale crop. It also notes that we
are now within a few days of the time
when usually half OF the crop rs marketed.
and says. should therefore, the rate OF
marketing the present crop he proper
uonatoiy as rapid as in former seasons
very close TO half of the Weld has alreadv