The Salt Lake herald. [volume] (Salt Lake City [Utah]) 1870-1909, 1894-12-13

washington, Dec. ia letter was
received from Lyman ]. Gage. the
prominent Chicago banker, at the open
ing of the hearing of the House Com
mittee on Banking and Currency to-
day.
Referring to the recommendations of
the President and secretary of the
treasury, Gage said:
Agreeing with the criticisms of these
officers of the government as to the
present weakness of our situation and
the great desirability of separating the
government from direct responsibility
from currency issues, L am persuaded
that the country is not ready to &C
cept their recommendations.
ANY change of the method should
be so simple that all can comprehend
it, and it should be seen that the in
cidental effect would not be in any di-
Tection disturbing to trade, commerce
or in.ustry. l believe the Baltimore.
plan carries the true principles of a
credit currency, but we cannot reach
it by one step, and years may inter
Vene before it can be realized. Mean
ftfme the way for the government to
= step out of the currency business and
place the burden of redemption on the
banks is plain; authorize an issue of
$3.50, 100000 tWo-and-a-haf per cent
bonds, payable at such time as Con-
gress may elect twenty-five years de-
Sirable), to be offered subscribers at
par; accept in payment United States
legal tender notes or treasury notes,
the same to be cancelled; amend the
national bank act so that banks can
obtain note issues to the face value of
bonds, deposited as security for cir
culation; reduce the tax on circulating
notes to half of l per cent.
Made Good the Vacuum.
'TThis done, national bank notes
would make good the vacuum caused
by the retirement of government
notes. In fact, there would be some
3 expansion under it, to be followed later
by some contraction through forced
redemption of bank issues, if it be
true, as some claim, the volume of the
circulating medium in the United
States is larger than can be main
tanned, and the outflow Of gold is ma
lures method of equalizing things. The
problem is this-to take the govern
Sment out Of the note issuing business,
Flrst-Without contracting the currency
- in the process; second-witnout invit-
ing an expansion. Secretary Carlisle's
lplan is the danger involved under the
SFlst suggestion. Were the above sug-
ffesIlons TO receive serious considera-
non, there are some features of the
national bank act that would require
amendment, in order to give note hold
ers easier and cheaper access to points
of redemption than now exists Re
oemption agents in cities should be re-
stored-but these are details which I
will pass by
1-+#
n. Gibbs, treasurer of the New York
Life Insurance company, approving the
national bank system with some modifi-
cation.
Buffers Plan.
George c. Butler, of New Haven,
Conn, presented a currency plan diff
fering from the secretary's and the
Baltimore plan It's features include
notes issued up to so per cent of the
banks capital; removal Of the comp
tToller of currency to New York
where he is TO have control Oh a specie
reserve, made up of % per cent of the
notes issued. Buffers plan also pro-
posed a board of bank officers in New
York, presided over by the comptroller
of the currency; and also the erection
of a suitable building in New York for
a currency bureau.
MI Butler was questioned at great
length by every member Of the COM
mittee showing exhaustive familiarity
with practical banking. He said the
requirements of Secretary Carlisle that
all national banks guarantee the notes
of each bank would nullify the law.
Banks would not accept such unknown
responsibility. There might be no real
risk owing to the safeguards provided
by Mr.. Carlisle, but boards of directors
would never vote to accept the risk
Mr. Butler and Mr., Horace White of
New York. were further questioned
after the recess.
MI. Cornwall, of Buffalo, was ex-
pected 10 address the committee, but
as he failed to put in an appearance the
committee adjourned until tomorrow.