The Anaconda standard. [volume] (Anaconda, Mont.) 1889-1970, 1894-12-05

IA, MONTANA, WEDNES ,
and il cannot bo permanently avoided, or
even temporarily improved, without ma.
terial changes in our laws relatiug to that
subject. These features are: First-Cir.
culation OF United States notes - cur.
rcncy and their current redemption In
coin on demand. Sccond-Compuleoey re.
issue OF such notes after redemption.
Third-Excessive accumulation and tho
coinage of silver and the issue of notes
and certificates against Il upon . ratio
which greatly overvaiues the amount ~
compared with tho standard unit OF value
In this and other principal countries. Tho
frequent issue OF bonds for the purpose OF
procuring gold which cannot be kspe after
II has been obtained will certainly cause
increased distrust among our own people
~ we'll ~ among people Of other coun.
tries, and not only swell the volume OF
our securities returned from abroad, for
sale or redemption, but increase the with.
drawais OF foreign capital heretofore In.
vested In domestic enterprises.
"Wc cannot preserve our trade relations
with our bost customers for our surplus pro-
ducts unless wo maintain monetary sys-
tom substantially in accord with thsiru. and
until they manifest disposition 70 coop.
crate with US In olfecting o change upon
tho terms just and fair to oil our interests,
We ought to continue our adhesion to o
gold standard Of value with ~ large . use
Of silver as Is consistent with the strict
maintenance OF that policy.
"Since the resumption OF specie pay.
ment the United States legal tender and
gold to tho amount OF $6),O0), 900 aud all
notes redeemed have been reissued and
arc now outstanding. They are con.
slant menace to the gold reserve and
NO scheme Of financial reform can
be complete or eifectual which
does not provide at least for their
gradual elimination from our currency
system. am convinced that tho inter.
ests OF the country require such . change
In our organisation as will discharge tho
government entirely from the business Of
issuing or rcissuing these notes. and thus
relieve its financial department OF peri
odical demands on its resources which.
under the ex sting system, must continue
to disturb the financial and general bust.
ness affairs Of tho people. The arbitrary
regulation Of the value OF circulation TO
be kept outstanding 10 wholly incon.
sistent with the maintenance Of .
healthy financial condition and 10
the exercise Of function which docs
not properly belong to tho government
or any other public authority. Its eject
is to force paper currency on the people
when it 10 not needed and deprive them
of 1t when It 10 needed, thus establishing
aud maintaining an improper and unwar.
rantcd connection between the govern.
ment and tho private business affairs Of
its citizens, and making their successful
prosecution largely dependent on the
caprice OF the superior authority, having
no interest in the transaction, except,
perhaps, partisan intcrcst, not In har.
mony with sound financial arranssmsnts.
"In my opinion the imposition OF . tax
by tho federal government upon the use
Of circulating notes lawfully issued by
the state banks 10 IN unjustifabls. IL not
an uncons,itutional, interference with
tho authority of tho several states. but its
validity has been judiclally sustained, and
~ IL does not appear to be practicable to
repeal 1t absolutely at this time. II is pro.
posed to avoid its prohibitory effect by
exempting from taxation tho notes Of
such banking institutions % may be os.
ganized and conducted under the coudi.
tions which will amply protect the hold.
ers OF tho paper. 1t will be observed that
tho plan submitted proposes the repeal OF
all the provisions OF the existing laws
which require national banks to bold 0
fixed reserve against the deposits, and a.
this IL departure from tho practice
which has prevailed continuously for
more than 30 years, 1t 10 propsr to state
tho reasons which have prompted me to
make these suggestions"
The secretary hero takes up the No.
tional banking system IRON the time II
was originally organized and discusses its
many features in detail. He says: ut
10 not tho duty or province OF the govern.
ment to control or regulate the private af.
fairs of the people, except for certain well
defined purposes. and as the custody and
use of funds belonging to tho depositors
are matters which affect only the interests
of the intermediate party, they should be
left to their own judgment and discretion.
Every properly managed bank. II left FREQ
to conduct it's own deposit and discount
business in tho manner most advantage.
Gus to its own interests. will keep on hand
o reasonable reserve to meet not only tho
ordinary demands but to provide for
such emergencies ~ are liable to occur
in the community whcro II 10 located; but
II ought to be prohibited by law from us
ing such reserve, for the only purpose
it was designed TO accomplish.
Tho requirements that tho banks
shall pay their own obligation
imposes upon them no greater hardship
than is imposed by law upon every other
business and financial institution in tho
country. and the only argument that can
be plausibly urged against 1t, In tho case
Of banks, 10 that as the government has
always undertaken through their
agency to secure sound circu.
lating medium, 1t should pledge its
credit to keep it good under all
circumstances. The conclusive answer to
this is that tho government has dis.
charged its whole duty in tho matter when
it has provided such safeguards as will
guarantee the safety of tho notes issued
by its authority; and this is one of the re-
suits which the proposed plan is intended
to accomplish.
"The experience OF this country, under
the act OF February, 1874, which limited
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