New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1894-12-11

the State bank notes would be likely to occupy NJ
least portion OF the field proposed for silver cor
tifcates and the Secretary admitted that such
would undoubtedly be the result to some extent.
Would that not give the State banks an adj
vantage over National banks" asked Mr. Johnson.
OF Indiana.
Mr. Carlisle replied THAT is matter have
thought . good deal about but am not prepared
to express opinion
Mr.. Johnson, Of Ohio. thought that any pahN
might redeem it's notes in silver coin and Mr.
Carlisle replied In substance:
think that would be the case at the banks OPP,
the parity between sold and silver is maintained
Under the the Secretary Of the Tr C, has
gold or silver coin in his discretion bui me law
also provides that parity should be mainla ii
So long as that parity IL maintained there VIII ne
trouble about the redemption OF the panKnotes'
Mr.. Sperry. of Connecticut. then asked: What
kinds OF Government paper are now redeemable III
gold COIN The Secretary replied The green
backs and tn Treasury notes OF 1890"
You do not redeem silver certificate with
gold dollar asked Mr.. Spcrry. NO was the re
ply. Well" continued Mr. Sperry. 'ff you retire
all the sreerbacks ard Treasury notes You vii!
then have no outstanding obligations payable in
gold Would not be a silver basis then.
Mr.. Carlisle replied in the negative and said that
the Government would still be bound to maintain
the parity of the two metals and that If n bank
should refuse to redeem its notes in gold when de-
manded its credit would suffer. Secretary Carlisle
expressed the opinion that legislation is necessary
to prevent the constant tendency of subsidiary
silver to flow back into the Treasury and thought 1t
might be wise 10 expand its legaterder function.
Mr.. Sperry also wanted to know II. should the
time ever come when there was no paper % ~"
Government reieemahle in gold. ihc debts ot the
Government would not he paid In silver. To this
Mr. Carlisle said that there would not be enough
silver TO do this Furthermore. the debts Of the
Government paid in .arse bills The silver
needed
piled up in the banks by ira lcsmcn. The banks
could not pay 1t out and therefore sent il; - Wash
ing for redemption in notes Of large denominations
The Treasury Department found considerable din
Guilty in getting this money into circulation again.
and the Secretary thought there would therefore be
no grea; demand for silver in payment OF Govern
ment debts.
Mr.. Carlisle in answer TO several questions. sain
he held that the Government was not. legally speak
Ing under greater obligations TO take care of the
depos,ors than II to stockholders OF corpora
lions. manufacturing orga liza;ons. etc.
THE EXEMPTION or STATE BANKS
Skipping TO his eleventh suggestion. as outlined
in his report. Mr. Carlisle gave some explanation
Of H. The idea suggested dealt with exempting State
banks from National taxation under certain con1i-
tons given by the Secretary in his report a. fol-
.ows:
Circulating notes issued by hlnkins cooperation,
which transacts no other than "A banking business
shall be exempt from taxation under ~ a%s 81 tne
United STA es when !; j shown TO the si!is!A, ,cn
Of the Secretary OF the Treasury ana the controller
% That such bank has at no time hal on'stanl-
Of It's pad,up and un,mpared eap% table fo-
the reemI Of circulating notes - the fH, ex
tent Of their ownership ~ stock
90 That the circulating notes constitute. hy ia". =
first len upon al the assets ~ the bank
ante fund in tnifei state esaenicr n5,.. IN
Guiding Treasury notes OF lS" equal 10 ~ per ccn'Hm
% That it has promptly redeemed notes 'r DE-
branch offices. II II has branches.
After remarklng that ne would amend paragraph
SO thar It's provisions should not apply 20 al
nlnistrators. guardians Or trustees. the Secretary
said mat he had not &c, ou' plan hut had pro
posed exemption from taxation on certain coni'-
tons and he referre1 the committee 10 MS report
for hts II impracilcab.e To- rc1cal IN"
tax absolutely; it might not re- wise - 3D. 50. hni
re law could No safely rc'7Tel In me manor
and to tie extent recommended. ii" iwie" do
clared that Re favored unconditional repeal. and he
expressed the opinion that the tax was unconstru-
tional although the Supreme Court had decided
otherwise Mr. Warner wanted ~ know where the
20 per cent guarantee fund Of the State hanks
would be deposited and Mr. Carlisle replied In
substance follows:
have devoted a good deal OF thought 20 this mat
not believe that the United states mas anything 20
do with 1t. 1t IS matter for the respective states
guarantee fund shall be kept separate and main
tanned at all times without imparmen,- whether
in the banks own vaults or In the custody OF
state official is Of no concern 10 the General Gov
eminent.
This led n short discussion between the
Secretary and Mr. Johnson. OF ohio. the upsho -
which was that after all everything depended upon
the honesty OF the bank management. In the form
er's opinion which led Mr.. Walker. Of Massa-
chusetts to ask: why not have the guarant""
funds Of the State banks deposited in the National
Treasury az you would have those u the National
banks? Does your proposition establish or at
least suggest the inference that the former viii b"
more honesty conducted than the latter
The Secretary protested that 1t would give tho
Treasury too much trouble TO look after the guar
antec funds Of all the state banks. lie WAS very
emphatic in his contention that under presen;
conditions ana methods OF doing business there
would be and could be no danger o, revival Of
wildcat" banking Conditions, experience. every
thing would forbid IT," he declared.
Mr. Cariise's twelfth suggestion was easily cx-
planned. 1t provides that tine Secretary Of the
Treasury may under proper rules and regulation,
20 be established by him. permit State banks to
procure and use in the preparation Of their notes
he distinctive paper used In printing United States
securities but no State bank shall print or engrave
it's notes in slmtude Of United States note or Ger
t!hcate or National bank note
Mr.. Walker, OF Massachusetts however thought
the State banks should be required to differ more
completely In the appearance of their notes from
the United States notes and certificates ana Ma
tional bank notes. II was not well he believed. To
allow State bank notes not differing greatly from
those Of the Government to be circulated until un-
thinking people would accept them as Government
notes. Mr. Carlisle made no definite answer TO MI
Walker saying that the Government proposed TO
lessen so far as possible. its relations with the
State banks.
NEED FOR GOVERNMENTAL SUPERVISION.
1t was contended by Mr.. Carlisle that IT was
necessary to give the Government authority. as was
contemplated In his plan. to Impose tax on clrcu-
laton OF State banks II they did not comply with
the conditions imposed by Federal law This was
the only way the Treasury Department had of con
trolling National banks which refused TO comply