Daily Kennebec journal., 1894-12-19
IN CONGRESS.
The Currency Bill Taken Up
By the House.
Springer Says Bill Fails to Meet Any
ones Ideas In Its Entirety.
And All the Other Speakers Convey About the
Same Impression.

Washington, Dec 1S.-The House
went into committee of the whole on the
currency bill. Springer began the discus
sion of the bill. The bill, Springer said
did not represent the views of any mem
Der of the banking and currency commit
tee or of the House in its entirety. 1t was
a compromise measure, submitted as the
best that could be hoped for at the pres
ent time. He quoted from the report of
the committee TO show what the bill re
quired in lieu of deposit of United States
bonds or other interest-bearing obliga
tions as a security tor circulating notes.
Sickles, interrupting, said that one sec
ton of the bill gave the note holders IA first
lien upon the assets of failed bank, and
another section gave the banks contribu-
ting to the safety fund alsoa first lien up
ON the assets of the failed bank.
Springer-The gentleman is mistaken.
The note holders have the first lien upon
the assets of the bank; and when they
are satisfied, the banks contributing TO
the safety funds shall have the first lien
upon the remaining assets, to make good
any impairment of the guaranty fund.
The insertion of the word remaining"
Will CuIc tut utltClo III >
view.
Springer contrasted the provisions of
the bill for the redemption of notes of
failed banks with those of the SO called
Baltimore plan, asserting that they Were
practically identical in effects and extent.
All national banks and bankers in the
United States, he said, endorsed the Balti-
more plan.
Mahon asked what would be the effect
of the scheme We're half of the banks to
fail. Would the other half be assessed
to pay the debts of the failed banks?
Springer responded that if all the banks
failed, the fund provided in the pill would
be vastly more than sufficient to meet
every demand made upon it.
r Discussing the mutual liability pro
posed, Springer called attention to the fact
that it was similar to the provisions Of
the Canadian and Scottish systems. In
Canada the notes of failed banks bore 6
per cent interest and generally went at
once to premium. They We're sought
by bankers and financiers as investments.
In all the years the law had been in eX-
istence, there had been but one case
where Canadian bank failed to pay the
note holders and depositors in full, and
in that case the depositors received 80 1-3
per cent. of their claims, the note holders
being fully repaid. The Scottish system,
in 145 years existence, never failed to pay
the note holders in full.
Springer said that for every $50 of
greenbacks deposited as security there
would be issued 800 i'll notes. He stated
that at the proper time he would move to
amend section 7 of the bill to give ma
tional banks year after the passage of
the bill within which to comply with the
terms of the law, instead of fixing the
limit at June 30, 1897
Sperry read from the National Bank
Note the statement that it was secured by
a deposit of government bonds with the
treasurer of the United States and asked
Springer whether it was intended to vary
the security of the notes now outstanding
The bill, he said, authorized national
banks to withdraw s265, 900, 600 in bonds
now on deposit and substitute for the pre-
sent circulation $50, 600, 900 in non-inter-
est-bearing notes.
Springer said that every note now out
standing would be redeemed in accor-
dance with the existing law, and there
would be none issued except in accor-
dance with the provisions in the proposed
law He stated that none of the provi-
sions of the present law for the redemp
tion of notes We're touched by this bill
There was nothing in the bill looking to
an increase of the bonded debts, nor of
legal tenders
Cannon asked if the bill would prevent
government officials from borrowing
money ostensibly to maintain the gold re
serve, but really to pay current expenses?
Springer-There is nothing on that
subject in the bill. State bank notes
would not be legal tender.
Walker said our banking system is so
faulty that it was costing the people $50,
600, 600 merely for the machinery OF
loaning capital after they had paid the in
terest. We have loaned 81, 200, 900, 600 Of
81, 800, 000, 600 capital. Noother banking
system tied up SO much of its loanablc
funds. The House and committee on
banking and currency refused to come
to the aid of the people by providing or
proposing legislation necessary.
All forms of legislation which operated
first to the advantage Of cities was to the
detriment of the country, and then it re
turned to blast the cities. He said the
minority endorsed no bill and would not
until it was in position to make its
views effective. He spoke of the method
of the redemption of notes practiced in
the Bank of France, which, he said, must
be followed here in any safe system of
finance That was, at the option OF the
customer, to give gold or silver in cx-
change for notes.
Under the operations of his bill, Wal
ker said, the losses from failed banks in
the past 80 years would have amounted
to $4,000 an infnitesirnal amount.
Under his bill, it would take eight to IL
months to retire all of the greenbaeks.
Walker said his bin was pernissive; the
secretary's bill mandatory. His bill pre-
vided for the appointment of commits
sion consisting of five leading bankers in
the five principal redemption cities, wFo
shall give the secretary of the treasury
advice and counsel in all matters relating
to financial matters of the government.
The committee rose and Henderson re-
ported the post office appropriation bill.
House adjourned