Richmond dispatch. [volume] (Richmond, Va.) 1884-1903, 1894-12-12
WEDNESDAY. DECEMBER IL, 1894
nrha Gnvernment Plan


Those nersons who hold that the United
States Government ought to have nothing
20 do with the finances OF the people
but ought to leave all financial matters
10 the bankers and other capitalists must
have been disgruntled at the appearance
of Secretary Carlisle on Monday last be-
sore tho Committee OF Ways and Means
~ tho Iiouse of Representatives TO ex-
Main what he styles "the Government
plsn'' of substituting new banking ana
currency system for the one which VIII
expire In the course of very few years
we do not understand how President
Cleveland can reconcile his support OF
"tbe Government plan" with the views
which he has been understood as hold
ing on this interesting and important
question. However Mr.. Carlisle ala not
seem TO think that he was departing from
the old ways. for he said, MY plan
that is. the Government plan-"requires
the notwithstanding system TO support
Itself entirely and relieves the Govern
mont of all connection with the system
EXCEPT to furnish notes and hold the
safety fund"
Mr.. Carlisle says his plan would 90
away with the present system OF redemp-
ton of national bank-nOtes. At present
national banks could send their mutt
lated notes to the Treasury and receive
in return new notes. whereas under his
rlan the Government was divorced en-
tirelv from the redemption Of national
bank-notes. and thus relieved of all re-
sponsiblity In the matter. But we are
Inclined to think. as at present ADVISED
that this is a defect In Mr.. Carlisle
plan. The present law keeps the peo-
ole constantly in the possession of cur
rency which can be readily handled ana
which Is always IN a condition TO be pass
,d from man to man. Ragged bank
notes are nuisance. If the new system
Is 10 result in such notes. we say let the
,ld system be perpetuated-so far as this
feature is concerned.
And here comes that much-abused word
Elasticity" Mr.. Carlisle was Che first
an TO explain what he meant by 'elas-
.city." He said that one great advan-
aee of his system was that 1t would
urnlsh an elastic currency" How?
lIr Carlisle explained that the entire
antional- bank deposit would not be filled
~ To the limit of the plan unless the
-ssness Of the country required it.
'nder the present system If a national
5auk desired to retire its circulation 1t
must send TO the Treasury lawful money
u the United States of the requisite
mount but 1t was not allowed TO with
draw this amount for circulation under
six months. Under the new plan the bank
might retire Its circulation one day and
increase II the next. This is a valuable
feature of the new system. and shows
that the Secretary knows what he means
by elasticity. Elasticity" is "a beside
ratum indeed. Let us adopt no new
system which does not provide for It,
We had supposed that the Government
plan made no attempt to secure deposit
tors; but Mr.. Carlisle said he believed
that plan would guarantee to depostors.
the safety OF their deposits. He also said
that II had come TO be generally believed
that the existing law requiring deposits
Of United States bonds as a security for
circulation was failure. He thought II
prevented elasticity of the currency. Then
away with 1t. Let us have elasticity and
an absolute guaranty Of security to de-
positors. and We shall have the best bank
Ing and currency system in the world.
There were other explanations made
by Secretary Carlisle touching; this highly
important matter; but we notice no more
Of them at present.