Mississippi leader. (Jackson, Miss.) 1892-1895, 1894-12-11

confined to the obligations originally In
tended and II the redemption of these OBJ
legations meant their cancellation the
fund would be very small. But these OBJ
legations, when received and redeemed In
gold. are not cancelled, but are reissued
and may do duty many times by way
drawing gold from the treasury. Thus
we have an endless chain in opera
tion, constantly depicting tn, trcasury's
gold and never near a final rest. As IL this
was not bad enough, we have by statu-
ary declaration that 1t Is the policy Of thu
government to maintain the parity bo-
tween gold and silver, aided the force and
momentum of this exhausting process,
and added largely to the currency obliga-
tions claiming this peculiar gold redemp-
tion our small and the reserve
is thus subject to drain from every side.
The demand that increase our danger also
increases the necessity Of protecting this
reserve against depletion, and IL Ia most
unsatisfactory to know that the protec-
ton afforded II only temporary pallia-
ton 1t II perfectly and palpably plain
that the only way under present condi-
tions by which this when dangerously de-
pleted can be replenished IL through the
issue and sale Of the bonds of the gov
eminent for gold, and yet congress has
not only thus Tar declined to authorize the
issue Of bonds best suited to such pur-
pose, but there seems q disposition In
some quarters to deny both the necessity
and power for the issue of bonds at all.
cannot for q moment believe that any Of
our citizens are deliberately willing that
their government should default Tin its
pecuniary obligations, or that It's financial
operations should be reduced to silver
basis. At any rate, could not feel that
my duty was done II I omitted any effort
could make to avert such a
calimity. As long, therefore, as
no provision 10 made for the
final redemption or the putting aside Of
peatedly and constantly draw from the
government ito gold and AZ long 40 no
better authority for bond issues II allowed
than at present exists, such authority will
be utilized whenever and AZ often as 1t be-
comes necessary TO maintain o sufiiciens
gold reserve and in abundant time to save
the credit Of our country and make good
the financial declarations OF our govern
ment. Questions relating to our banks
and currency are closely connected with
the subject Just referred to aud they also
present some unsatisfactory features.
Prominent among them are the lack OF
elasticity in our currency circulation aud
its frequent concentration in financial
centers when 1t Is most needed In other
parts Of the Countrywide absolute d1
vorcement Of the government from the cir
culation of the currency Of the country.
This condition cannot be Immediately
reached, but as a step In that direction and
as means Of securing q more elastic cur
rency and obviating other objections to
the present arrangement Of bank circula-
ton, the secretary Of the treasury presents
In his report a scheme modifying the pres
ent banking laws and providing for the
issue of circulating notes by state banks
free from taxation under certain limita-
tions. The secretary explains his plan SO
plainly and its advantages are developed
by him with such remarkable clearness
that any effort on my part to present argu-
ment in its support would be superfiuous.
l shall therefore content myself with an
unqualified endorsement of the secretary 8
proposed changes in the law and brief
and imperfect statements of their promi-
nent features.
1t is proposed to repeal all laws provid-
ing for the deposit of Uni ted States bonds
as security for circulation, to permit ma
tional banks to issue circulating notes not
exceeding in amount IS per cent of their
paid up and unimpaired capital, provided
they deposit with the government as
guarantee fund in United States legal ten
der notes, including treasury notes Of
1890, q sum equal in amount to 30 per cent
of the notes they desire to issue. this de-
posit to be maintained at all times, but
whenever any bank retires any part of its
circulation a proportionate part OF its
guarantee fund shall be returned to it to
permit the secretary of the treasury to
prepare and keep it ON hand ready for is
sue in case an increase In circulation is de-
sired blank national notes for each bank
having circulation and to repeal the pro-
visions Of the present law imposing linn
itations and restrictions upon banks de-,
string to reduce or increase their circula-
ton, thus permitting such increase or re-
duction within the limit of rs per cent Of
capital to be quickly made as emergencies
arise.
In addition to the guarantee fund re-
auired it is proposed to provide safety
fund for the immediate redemption of the
posing q small annual tax, say one-half
of per cent. upon the average circula-
ton Of each bank until the fund amounts
to per cent. of the total circulation out
standing. When q bank fails it's guaran-
tee fund is to be paid into this safety fund
and it's notes are to be redeemed in the
first instance from such safety fund thus
augmented. Any impairment OF such
fund caused thereby to be made good
from the Immediately available cash as
sets Of said bank, and If these should be
insufficient such impairment to be made
good by pro rata assessment among the
other banks, their contributions constitu-
ting q lien upon the assets of the failed
banks.
As further security, it is contemplated
the existing provision fixing the individ-
ual liability Of stockholders is to be re-
tanned, and the banks indebtedness on 40
count Of its circulating notes is TO b
made first lien on all its assets.
For the purpose of meeting the expense
OF printing notes, official supervision, cam
collation.. and other like charges, there
shall be imposed tax of say one-half of ]
per cent. per annum upon the average
amount Of notes In circulation. 1t Is
further provided that there shall be no
national bank notes issued of less de-
nomination than ten dollars.
That each national bank, except in case
Of failed bank. shall redeem or retire its
notes in the first instance at its own Office
or at agencies to be designated by it, and
that no dxed reserve need be maintained
on account Of deposits
Another very important feature of this
plan is the exemption Of state banks from