Democratic Northwest and Henry County news. [volume] (Napoleon, O. [Ohio]) 1894-1905, 1894-12-06

PRESIDENTS MEssAGE-- CONTINUED FROM lst PAGE.
etEsrlcit5 IN ou1~currency clrcururron ana
its frequent concentration in financial CEN
tiers when 1t Is most needed in other parts
OF the country, The absolute enforcement
OF the government from the business of
banking is the ideal relationship of the
government TO the circulation of the cur
rency of the country.
This condition can not be Immediately
reached; but as step in that direction
ana as means of securing a more elastic
currency and obviating other objections to
the present arrangement Of bank circula-
tlon, the secretary Of the treasury presents
IN his report a scheme modifying present
banking laws and providing for the issue
OF circulating notes by state banks free
from taxation under certain limitations.
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 ar
gument in its support would be super
huous; shall, therefore, content myself
with an unqualified Endorsement of the
secretarys proposed changes in the law
and brief and imperfect statement of
their prominent features.
1t is proposed to repeal all laws provid-
ing for the deposit of United 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 4
guarantee fund, in United States legal
tender notes, including treasury notes of
1890, sum equal In amount to
80 per cent of the notes they desire to is
sue, this deposit to be maintained at all
times, but whenever any bank retires any
part OF its circulation a proportional part
of its guarantee fund shall be returned to
it; to permit the secretary of the treasury
to prepare snd keep on hand ready
for issue in J case an increase in
circulation is desired blank ma
tional bank notes for each bank
having circulation and to repeal the pro-
visions of the present law imposing limita-
tions and restrictions upon banks desiring
to reduce or increase their circulation
thus permitting such increase or reduction
within the limit of 70 per cent of capital to
be quickly made as emergencies arise.
In addition to the guarantee fund re-
quired, it is proposed to provide safety
fund for the immediate redemption of the
circulating notes of failed banks, by i'm
posing a small annual tax. say one-half of
l per cent, upon the average circulation of
each bank until the fund amounts to per
cent of the total circulation outstanding.
When bank fails its guarantee fund is
to be paid into this safety fund and its
notes are to be redeemed in the first in
stance from such safety fund thus aug
mented and impairment Of such fund
caused thereby to be made good from
the Immediately available cash assets Of
said bank, and If these should be INSULT
cient such impairment to be made good by
pro rata assessment among the banks,
their contributions constituting first lien
upon the assets of the failed bank in favor
Of the contributing banks.
As d further sAburity it is contemplated
that ta, existing provision fixing the indi-
vidual LIABILITY OF stockholders. is to be re-
tanned, aud Il. bank i Indebtedness, on ac-
cJunt Of its circet7t!ns notes ls TO be
made q first lien on all its assess,
For the purpose of meeting the expense
of printing notes official supervision, can
callation and other like charges there shall
be imposed tax of say one-half of per
cent per anGu.l c..1ou the average amount
Of notes In circulation.
n 1t is further provided that there shall be
no national bank notes issued of a less de
nomination than $40. That each national
bank, except in case OF failed bank, shall
redeem or retire its notes in the first in
stance at its own Office or at agencies to be
designated by it, that no fixed reserve need
be maintained on account OF deposits.
Another very important feature of this
plan is the exemption of state banks from
taxation by the United States in cases
where it is shown to the satisfaction of the
secretary of the treasury and comptroller
of the currency by banks claiming such ex-
emption that they have not had out
standing their circulating notes ex-
ceeding 75 per cent of their paid up
and unimpaiped capital; that their
stockholders are individually liable for the
redemption of their circulating notes to
the full extent of their ownership of stock;
that the liability of said banks upon their
circulating notes constitutes under their
state law a first lien upon their assets;
that such banks have keptand maintained
a guarantee fund in United States legal
tender notes, including treasury notes OF
| 1890 equal to 80 per cent OF their outstand'
| ing circulating notes, and that such banks
have promptly redeemed their circulating
| notes when presented at their principal OF
| branch offices.
1t is quite likely that this scheme may
| be usefully. amended in some of its de-
| tails, but / am satisfedit furnishes basis
| for a very great improvement in our pres
| ent banking and currency system.
Iconclude this communication fully ap
preciating that the responsibility for al
| legislation affecting the people OF tht
! United States rests upon their represents
tives in the congress, and assuring them
| that whether in accordance with recon-
| mendations / have made or not shall bt
| glad to cooperate in perfecting any legis
lation that tends to the prosperity anG
! welfare OF our country.
GROVER CLEVELAND.
| Executive Mansion, Dec 3, 1894.
/ d.. ooo1,4 -, o,,t ~ cilvarxuo Y,iI