New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1894-12-24
THE DANGER NOT ATERIED.

THE DANGER NOT ATERTED.
Congress has adjourned over the holidays, but
II Is evident that there is to be concerted ei-
for, 70 bring partisan and other influences to
hoar ON business men and Congress. in order
TO force through the substitute Dill as soon rs
possiblc after the recess II is now asserted ID!
Democratic Journals that nearly all the Dei'o-
cratic members from the East Will he Drougnt
10 support the new Currency DILL thoush ITO
one can pretend that the small changes maze
remove the gravcst dangers threatened ny the
original measure. Hence 1t IS important Ihat
business men. who know something OF 'hose
dangers. should not rest silent IN the easy Ial'h
that Congress will not bc foolish enough 10
pass any such bill. for their earnest influence
will evidently be needed Ia resist the powerful
pressure which will be cxcrted by the EXecu-
tive by partisan managers and probably by
caucus.
II Is sheer nonsense to argue that this Dill
ought to he put through because the treasury
Is in trouble The fact Is that the Treasury Is
in trouble because this dangerous bill Is pend
ing It's passage would not in the slightest re-
spcct remove the dangers of the treasury
but would in all probability increase them
greatly This is obvious when il Is considered
that the new bill. while it does not formally
require National banks To change their basis or
circulation. does expose them To such UNFAIR
and destructive competition by State banks mat
they would be most powerfully Influenced to
abandon the National system. sell their bonds
and organize under the new bill as state banks.
This would leave them free 10 continue thc CIT
culation of notes of less than SO each. wh'le rs
National banks this most profitable part OF their
circulation would be withdrawn. The change
would save them from two taxes amounting 10
| per cent on their entire circulation. when
State banks would not have 10 pay. IL wouih
offer the chance by convenient arrangements
with State officials to get back into their own
keeping as State deposits ut least part OF the
guarantee fund Of 30 per cent OF their circu-
lation which the State banks are permitted 10
place with a State official, who can then Keep
the fund as he does other funds wherever he
thinks safest and best while the National banks
have To place their funds with the Treasury.
These are hut part Of the inducements which
would operate To break down the National sys-
fem and TO substitute notes Of fortyfour different
kinds of State banks one ~ enormous potency Is
the opportunity ocnd money on real estate, when
I'm some sections would enable the banks To IN
crease their capital and business almost linden
niielv and until the crash comes. their pron's
also The men engaged in conducting National
hanks are not 50 entirely different from others
engaged in money lending that they would
shrink from the risks attending loans OF this
character What restrictions State laws may
providc can only be guessed from experience
under State banking laws before the war. when
Democratic money brought repeated disasters
Thirty wears under the National system have
proved that II Is cmncnily wise In its rcsiric
lions and safeguards and the disposition 10 over
throw these and 10 rush again into the satur-
MALTA 81 wildcat banking is not one which any
sober business man should encourage.
All the influence which the new bill would
exert 10 drive banks out Of the National sys-
tem or to subject them 10 such competition from
less restricted and less taxed State banks, would
opcrate also 10 cause sales Of United States
bonds which the banks now hold. That some
would surrender circulation At once, should the
new bill be passed IS only too obvious ana the
sales Of bonds by these would start fall In the
price But the losses liable to b. incurred by
holding the bonds too long would then weigh
powerfully with other banks. and 50 every sale
would tend TO bring about other sales. IL II not
this sort of thing which will restore confidence
In the Treasury or prevent Withdrawals or goid
or render II more easy for the Government 10
maintain gold payments. ON the contrary. II Is
only TOO clear that the substitute bill, not less
than the original. would threaten National bank
ruptcy and a profound monetary disturbance