The representative. [volume] (St. Paul, Minn.) 1893-1901, 1894-12-05
FARMERS ALLIANCE BANKS.
A Valuable Suggestion From DIR.
Johnson.

Valuable Suggestion From DIR.
Johnson.
To the Editor:
Now that political agitation is over, Tor
a while at least. and present economic and
financial systems will remain for number
of years to come it behooves us to see if
something cannot be done under existing
laws by united action of the farmers to
better their condition and protect them
selves against unjust eXactons. There is
at present among the Peoples party, es-
pecially in the country, a strong feeling
against banks and bankers Not, indeed,
against legitimate banking, which is, Of
course, necessary and honorable as any
other business; but against shaving shops
and Shylock counters. and many, if not
most. of the banks in the country are gen.
orally believed to be guilty of practicing
ways that are not always straight to in
crease their earnings all banks are looked
| upon with suspicion. Nor has the last cleo
| ton tended to give reformers in general
| better opinion of bankers. Almost without
| exception they ignore the distress of the
| producing classes. But what is worse, the
| bankers and money loaners were the pow
| erful levers that swung thousands and
| thousands of voters who believe in the
principles of the Peoples party to vote the
| Republican ticket. l. for one, am thorough
| ly alive to the fact that as long as the
money loaners and bankers possess this
enormous leverage over the voters, it is
| next to impossible for any reformer against
| their desire to win. Now, what can be done
| to rid the state, and the rural districts es
| in1lSr Of ,.ir of
| banks and bankers? Why, the remedy is
| obvious and simple. In every county where
| the reform population is large enough to
| support banking institution, let trusty and
| reliable Peoples party men or Farmers
| Alliance men organize a bank and bring
! the Shyocks to terms. Why should Peo-
| pies party men turn the grindstOne to
sharpen the knives to cut their own throat?
| We have done this knife grinding too long.
| 1t must stop now. And it can be done. But
don't it take money to start a bank? 1t
| takes capital, of course, from $4,000 to
| $4,000, according to the size of the town,
but very little cash. Banking nowadays is
| not based on cash, as persons not familiar
| with banking business are apt to think,
but on credit and competent management
| Of the business. The law, indeed, requires
| that the stock shall be paid in before the
| bank can start in business, but there is
| nothing to hinder the bank from loaning
| most of it back to the stockholders the
| next day. Thus, if the stockholders
| raise the cash for few days to open the
| bank for business-eXcept what is necessary
| for safe, fixtures and statOnery-they
start bank Hundreds of small banks
| started in that way. When the bank is
| once open for deposit, business is done on
that, of course. Now what brings deposit?
Not the amount of cash in the safe, nor the
| size of the capital stock, but the character
| and standing in the community of the
stockholders and officers of the bank. What
| makes a bank safe? Not the amount of
| cash in it's vault, repeat, but the honesty,
| integrity and competence of its officers. A
| bank properly managed cannot fail. Con-
| sentative management makes it absolutely
safe. Hence, when there is business enough
| to pay the cashiers wages and interest on
| fixtures and incidental expenses for
| organizing, stationery. etc, etc,
and reliable and substantial men of the
| community will take hold of it, in bust
| ness like way, there be no such thing
as failure. OF course every possible safe
guard must be thrown around the insttu-
| ton. The cashier should give bonds and
| the president and directors such can be
depended on to inspect the business often
| and thoroughly. | am satisfied that the
| Peoples party or Farmers Alliance are
strong enough in many counties in this
state and have the resources both of capt.
| tai and brain to do successful banking
business. Yes, and make banking business
what it ought to be in all cases, an hon
orable and legitimate business. 1t is no
more difficult, comparatively speaking, to
organize and operate a bank, than a CO.
operative creamery. Now if what l have
set forth is correct, and competent
banker will dispute it, look at the result.
Interest is one of the great causes of the
Capitalization of wealth. A bank is a
farm that raises interest combined
credit, and not on cash. as [ have said.
The shrewd and smart financier has util-
lied and monopoiiZed this business far,
hence his wealth. Now let the ordinary
business man and substantial farmer COM
bine-organiZe-their credit and harvest
their own interest. Then this interest
would be scattered in the community and
stay at home, and remain where it justly
belongs. The general government ought
to do that for the whole people, and could
do it to the greatest advantage But pri-
vate banking interest and false economic
theories among the people stand in the
way of it's adoption. Hence l see no way
out of our present bondage to the money
loaner except through some such plan as
l have outlined. l simply offer this a
suggestion for reflection to intelligent Peo-
pies party men. 1 will ask Hon. j. A.
Reyes to give his opinion on the subject.
He is a lawyer and might see points both
| for and against that l may have over
| looked. / refer to Mr.. Reyes because
had the pleasure to make his personal &C
quaintance during the late campaign, and
know he is actuated by disinterested mo-
tives for the common people Business
should not enter into politics in my opin-
ion. But the Republican party has forced
the issue. The old saying is that must
fight fire with fire. Hence l for one am
willing to take up the gauntlet. 1t is a
poor game that two can't play at. The
present contest in politics is struggle for
| human freedom. Nay, for our own homes
and firesides. 1t is war to a finish-liberty,
or slavery. In many places Republicans
in the late campaign throttled newspapers
by threatening to take away their pat
. ronage. This is a sort of boycotting.
say, emphatically, retaliate! l say let us
| organize our forces and strike back.
say let us assert our manhood and if We
perish in the attempt SO be it. But We
| shall not perish! We shall conquer
| There is q way out, Someway. Intelligent
| and energetic action will find it,
DIR. CHRISTIAN JOHNSON
| New London, Mimi
|