Washington standard. [volume] (Olympia, Wash. Territory) 1860-1921, 1894-12-14
WHOLE NUMBER 1922.

eed stlOulu uc tuTiltu lulO american
hands.
The ancient provision of our law,
denying American registry to ships
built abroad and owned by Americans
appears in the light of present condi-
tions not only to be failure for good
at every point, but to be nearer a relic
OF barbarism than anything that exists
under the permission Of a statute of
the United States. l earnestly re-
commend its prompt repeal.
THE RECENT BOND ISSUE.
During the last month the gold re-
serve in the treasury for the purpose
OF redeeming the notes of the govern
ment circulating as money in the
hands of people become so reduced
and its further depletion in the near
future seems so certain that in the ex-
ercise of proper care for the public
welfare it became necessary to replen
ish the reserve and thus maintain pop
ular faith in the ability and determi-
nation of the government to meet as
agreed its pecuniary obligations.
1t would have been we'll in this
emergency if the authority had existed
to issue bonds of the government hear
ing low rate of interest and that
maturing within short period.
AS the Congress having failed to
confer such authority, resort was ne
cessarily had to the resumption act of
1875, and pursuant to its provisions
bonds were issued drawing interest at
the rate of five per cent per annum
and maturing ten years after their is
sue, that being the shortest time au-
thorize by the act. l am glad to say,
however, that in the sales OF these
bonds the premium received operated
to reduce the rate of interest to be
paid by the government to less than
three per cent.
We have All endless chain in opera
tion constantly depicting the treas
ury's gold and never final rest. As
if this was not bad enough, we haye a
statutory declaration that it is the
policy of the government to maintain
the parity between gold and silver to
aid the force and momentum OF this
exhausting process and add largely to
the currency obligations claiming this
peculiar gold redemption. Our small
reserve is thus subject to drain from
every side. The demands that in
crease our danger also increase the ne
cessity of protecting this reserve
against depletion, and it is most un-
satisfactory to know that the protec-
ton afforded is only temporary pali-
alton.
/ cannot for a moment believe that
any of our citizens are deliberately
willing that their government could
default in its pecuniary obligations or
that its financial operations should be
reduced to silver basis. At any rate
1 should not feel that my duty was
done if ] omitted any effort 1 could
make to avert such calamity.
BANKING CURRENCY.
The absolute enforcement of the
government from the business OF bank
ing is the ideal relationship of the
government to the circulation of the
currency of the country. This condi-
ton cannot be Immediately reached,
but as q step in that direction and as
. means Of securing q more elastic
currency and obviating other objec-
tions to the present arrangements
of bank circulation the Secretary of
the Treasury presents in his report q
scheme modifying the present bank
ing 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 devel-
oped by him with such remarkable
clearness that any effort on my part
to present argument in its support
would be supertiuous. l shall, there
fore, content myself with sn unquali-
fed endorsement of the secretsry's
proposed changes in the law and a
brief and imperfect statement of their
prominent features.
1t is proposed to repeal all laws pro-
viding for the deposit of United States
bonds as security for circulation; to
permit national banks to issue circu.
lating notes not exceeding in amount
Is per cent. of their paid up and un-
impaired capital provided they deposit
with the government as guarantee
fund in United States legal tender
notes including treasury notes of 1880
a sum of equal amount to 30 per cent.
of the notes of 1890 of the notes they
desire to issue, this deposit to be main
tanned at all times, but whenever any
bank retires any part OF its circulation
proportionate part of its guarantee
fund shall be returned to it to permit
the Secretary of the Treasury to pre-
pare and keep on hand ready for issue
in case an increase in circulation is
desired, blank national bank notes for
each bank having circulation and to
repeal the provisions of the present
law imposing limitations and restric.
tions thus permitting such increase or
reduction within The limit of the Is
per cent. of capital To he quickly made
as emergencies arise. In addition to
the guarantee fund required it is pro-
posed to provide safety fund for the
immediate redemption of the circulat.
ing notes of failed banks by imposing
small annual tax, say one-half of
per cent. upon the average circulation
OF each bank until the fund amounts
to per cent. of the total circulation
outstanding, when a bank fails its
guarantee fund is to be paid into this