Grant County herald. [volume] (Lancaster, Wis.) 1850-1968, 1894-12-06

ltNclOpbu On UtLA WIFI SuCH TcmdTk-
able clearness that any effort on nv
part TO present an argument in its
support would be superfiuous. /
would therefore content myself with
an unqualified endorsement of the
secretary's proposed changes in the
law and brief and imperfect state
ment of their prominent features. 1t
is proposed to repeal all laws provid-
ing for the deposit of United States
bonds as security for circulation. to
permit national banks 20 issue circu-
lating notes not exceeding IS per cent.
of their paid-up and unimpaired capi-
tai, provided they deposit with the
government as guarantee fund in
United States legal tender notes, in
Guiding treasury notes of 1890, the
sum equal in amount to 80 per cent.
of the notes they desire to issue, this
deposit to be maintained at all times,
but whenever any bank Tetires any
part of its circulation proportionate
part of its guarantee funds shall be
returned to it. Further, to permit
the secretary of the treasury to pre-
pare and keep on hand ready for issue
in case an increase in circulation is
desired, blank national bank notes,
and to repeal the provisions of the
present law imposing limitations and
restrictions upon banks desiring to
reduce or increase their circulation.
In addition to the guarantee fund
required it is proposed to provide a
safety fund for immediate redemption
of circulating notes of failed banks by
imposing a small annual tax. say one
half of one per cent. upon the average
circulat ing notes of eachbank until
the fund amount to five per cent OF
the total circulation outstanding.
When bank fails its guarantee fund
is to be paid into this safety bank,
and its notes to be redeemed in the
first instant from such safety fund
thus augmented by impairment of
such bonds caused thereby 70 be made
good from the Immediately available
cash assets CT said bank, and if these
should be insufficient such impairment
to be made good by pro rata assesses
ment among other banks, their contri-
buttons constituting a first lien upon
the assets of the failed bank in favor OF
contributing banks: AS further Sc
curity it is contemplated the existing
provision for fixing the individual
liability of stockholders is to be re-
tanned and the banks indebtedness on
account Of its circulating notes is to
be made first lien on all its assets.
For the purpose of meeting the ex-
pense of printing notes, official super
vision, cancellation and other like
charges there shall be paid a tax, say
of one-half of one per cent. per annum
on the average amount of notes in
circulation. 1t is further provided
there shall be no national bank notes
issued of less denomination than ten
dollars, that each national bank ex-
cept in case of failed bank, shall re-
deem or retire its notes in the first
instance, its own Office or agencies to
be designated by it and no fixed re-
serve need be maintained on account
of deposits
ABOUT STATE BANK TAX.
Another very important feature OF
his plan is the exemption of state
banks from taxation by the United
States in cases where it is shown to
the satisfaction of the Secretary of the
Treasury and comptroller of the Cur
rency by banks claiming such exemp-
tion that they had not had outstand-
ing their circulating notes exceeding
seventy-five per cent of their paid up
and unimpaired capital, that their
stockholders individually are liable
for redemption their circulating notes
to the full extent of their ownership
of stock, that the liability of said bank
upon their circulating notes consti-
tutes under their state law first lien
upon assets; that such banks have
kept and maintain a guarantee fund
in United States legal tender notes
including treasury notes of 1890 equal
to thirty per cent of their outstanding
notes and such banks have
promptly redeemed their circulating
notes when presented at their princi-
pal or branch office. 1t is quite likely
this scheme may be usefully amended
in some of its details, but | am salts
fled it furnished basis for a very
great Improvement in our present
banking and currency system,
conclude this communication fully
approaching that the responsibility
for all legislation affecting people of
the United States rests upon their
representatives in Congress and as
Surfing them, whether in accordance
with the recommendation | have
made or not, shall be glad to Coop
crate in perfecting any legislation
that tends to the prosperity and well
fare of our country.
(Sigued) GROVER CLEVELAND,
Executive Mansion.
December 3, 1894.
Washington Letter.
(From our Regular Correspondent