Evening star. [volume] (Washington, D.C.) 1854-1972, 1894-11-14
THE U. S. CURRENCY
The President Will Advocate Its
Enlargement.
FEATURE OF THE NEXT MESSAGE
Banking Propositions Now Being
Carefully Considered.
A G II A N G e N E E d E D

President Cleveland is credited with q
purpose to be as dramatic in his message
| to the Iost-mortem session of the Fifty
| third Congress as he was IL that famous
| tariff message Of hi. first administration.
1t is pretty well understood that Cleve-
land sees no more advantage to himself in
harpine longrr on the one strain of tariff
reform. and that, anticipating that tho
silver men will force the issue of finances
to the 'front.' he proposes to rush to the
| front with a general banking proposition
providing basis for the expansion Of
| currency beyond what is possible with q
| single gold standard and a 30 per cent
bank currency based on United States
bonds at a premium.
Favored a State Bank Currency.
During the irst regular session MT.
Cleveland expressed himself privately AZ
being very favorably disposed toward tho
democratic proposition of state bank cur
reacy. to be revived through the repeal Of
the 10 per cent tax. Though he frequently
intinated that he might indorse this prop
ositiop In a message, he failed to do so,
probably fearing its effect on the election.
His ideas on the subject, however, were
very imperfectly formed at the time. He
expressed in general sort of a way that
there ought to be some sort Of govern
mental control of any currency permitted.
His Probable scheme Now.
From the position which he occupied at
that time and the purpose he now has to
present a scheme for the enlargement of
the currency through the agency of the
national bank system, IT Is supposed that
his message will present q proposition
which will have all the expansive quail
ties as to currency which would character
lie the repeal of the state bank tax, but
which at the same time will confine the
right of issue to banks accepting govern
ment supervision under the system of ma
tional banks. In a general way IL Is sup
posed that he will favor a national bank
currency based on other accepted securi-
ties besides the government bonds.
Hopes to Divide Southern silver Men.
Cleveland knows that the southern free
silver men do not, as a rule, care partic-
ularly for silver itself, but are innationists,
and desire an expansion Of the currency
to make money more abundant. He doubt
less hopes to divide the silver men Of this
section by a proposition to meet their de-
mands for an expansion of the currency
in q manner which will not of necessity
divorce the southern democracy from the
democrats of the east, and make sec
tional line Of demarcation in politics
1t is said to be the Presidents opinion
that the present system Is extremely
vicious and that 1t is responsible to a great
extent for the financial distress of the
country. The details Of the proposed plan
are withheld for the pr esent. 1t is UNDER
stood that the general plan embodes many
Of the features Of the plan for the amend-
ment of the national banking act adopted
at the convention OF bankers recently held
In Baltimore and commonly known the
Baltimore plan"
The Baltimore Plan.
The President is said to be favorably
impressed with that plan for the Improve
ment of our currency system, because 1t
provides for currency that would be
gauged by the needs of the country, ex-
pandng when money was in demand and
contracting with the removal Of pressure
for 1t.
A plan alternative Of that of the con-
vention and which has been called to the
Presidents attention, II government bank
ing Is to cease, provided for action by
Congress to retire the legal-tender notes
and to withdraw from circulation all
money. issued by the government. The
all the banking in the country. They
would be authorized to issue circulating
notes according to their capital and sur
plus, with the feature of an elastic cur
rency retained. The United States and
treasury notes would be retired in favor
of bonds at low rate of interest, prob
ably per cent.
Banks might take these bonds and issue
notes UP to their par value depositing the
bonds as security. When the banks desired
to contract the circulation they might sur
render notes and withdraw their eQuiva-
lent in bonds. AS the needs Of business
called for an increased circulation, the
bonds might be deposited again In the
treasury and the notes ressued.
Still Another Plan.
Still another plan considered by the Pres
ident is the one devised by ex-Treasurer
Spinner, and championed In Congress by
william d. Kelly OF Pennsylvania. 1t pro-
vided for the issue of money by the gov
ernment to citizens as they might apply
without employing the banks currency
channels. Money thus issued was to be
secured by government bonds bearing in
terest at 3.65 per cent-the lowest rate for
a goyernment issue in Gen. Spinner's time
and bonds and notes were to be conver-
tible at any time. A citizen with bonds
might deposit them and have notes issued
to him directly. When he could spare the
money the citizen might turn 1t into the
treasury and recover his bonds.
According 20 one authority, the Presi-
dent is convinced that the existing cur
rency system, which originated in the
stress and excitement of war times, re-
uuires radical reforms to meet the changed
conditions of the country. He will have q
great deal to say on this subject in his
message, and will undoubtedly make
strong argument.