The Austin weekly statesman. (Austin, Tex.) 1883-1898, 1894-12-06

not only thus far declined to authorize the
issue OF bonds best suited to such a pur.
pose, put tnere seems disposition in
some quarters to deny both the necessity
and power for the issue of bonds Mt ali
cannot for moment believe that INV
OF our citizens are deliberately WILLING
mat their government should default in IFS
pecunary obligations, or that its financial
operations Should be reduced to a silver
basis. AT any rate should not feel that
my duty was done if omitted any effort
could make to avert such calamity AS
long therefore as there is no nrovision
made for the final redemption or the mutt
ing aside of the currency obligation now
used to repeatedly and constantly draw
from the government its gold, and as long
as no better authority for bond issues is
thority will be utilized whenever and as
often as II becomes necessary to maintain
a sufficient gold reserve, and in abundant
time to save the credit of our country and
make good the financial declaration of our
government. They also present some IN
satisfactory features, prominent among
them is the lack of elasticity in our cur
rency circulation and it's frequent con-
centration In financial centers, when it is
most needed in other parts Of the country.
Inc absolute enforcement of the govern
ment from the business of banking is the
ideal relationship of the government to
the circulation of the currency of the
country.
FINANCIAL RECOMMENDATIONS.
This condition cannot be Immediately
reached, but as step in that direction
and as means of securing more elias
tic currency and obviating other objec-
tons to the present arrangement of bank
circulation the secretary of the treasury
presents in his report scheme modify
ing the present banking laws and provid-
ing for the issue of circulating notes by
state banks free from taxation under GER
tain limitations. The secretary explains
his plan so plainly and its advant-
ages are developed by him with such re-
markable clearness that any effort on my
part to present argument on it's support
would be supertluous. L shall, therefore
content myself with an unqualified en-
dOrsement of the secretarys proposed
changes in the law and brief and imper-
feet statement of their prominent feat
ures.
1t is proposed to repeal all laws provid-
ing for the deposit of United States
bonds as security for circulation to per-
NIT national banks to issue circulating
notes not exceeding in amount 70 per cent
of their paid up and unimpaired capital,
provided they deposit with the govern
ment as a guarantee fund in United
States legal tender, not including treasu-
ny notes of 1890, a sum equal in amount
to 30 per cent of the notes they desire to
issue, this deposit to be maintained at
all times, but whenever any bank retires
any part of it's circulation a proportional
part of it's guarantee fund shall be re-
turned to it to permit the secretary of the
treasury to prepare and keep on hand
ready for issue in case an increase in cir
culation is desired, blank national bank
notes for each bank having circulation
and to repeal the provisions of
the present law, imposing linn
itations and restrictions upon banks
desiring to reduce or increase their circu-
laion, thus permitting such increase or
reduction within the limit of IS per cent
of capital to be quickly made as emer-
gencies arise. In addition to the guaran-
tee fund it is proposed to provide safety
fund for the immediate redemption of the
notes of failed banks by i'm
posing a small annual tax, say one-half of
1 per cent upon the average circulation of
each bank until the fund amounts to B
per cent of the total circulation out
standing. When bank fails its guaran-
tee fund is to he paid into this safety fund
and it's notes are to be redeemed in the
first instance from such safety fund thus
augmented and the impairment of such