Western Kansas world. [volume] (WaKeeney, Kan.) 1885-current, 1894-12-08

| has issued, the gold held Tor Its
redemption and the means which
must be resorted to for the purpose of replen-
ishing such REDEEM ption fund when impair cd
Even If the claims upon this fund were con-
| fined to the OBLIGATIONS originally intended
and if the redemption of these obliga tions
| meant their cancellation the fund would be
very small But these obi gations when re-
ceived and redee med in gold are not cancelled
but are re-issued and may do duty many times
by way of drawing gold from the treasury
Thus we have an endless chain in operation
constantly depicting the treas ury' S gold and
never near final rest AS if this was not
bad enough we have statutory declaration
that it is the policy of the government
to maintain the parity between gold and sill :
yer aided the force and momentum of the ex-
hausting process and added lar gely to the cur
rency obligations claiming this peculiar gold
redemption. Our small gold reserve is thus
subject to draw from every side The de-.
mands that increase our dan ter also increase
the necessity of protecting this reserve
against depletion and it is most unsatisfactory
to know that the protection afforded is only a
temporary palliatfon 1t is perfectly and pal
pably plain that the only way under present
conditions by which this reserve when
dangerously de pleted, can be replen-
lshed, is through the issue and
sale of the bonds of the gov
ernment for gold and yet congress has
not only thus far declined to authorize the
issue of bonds best suited to such purpose.
terS to deny both the necess sfty and power for
the issue of bonds at all [ cannot for
moment believe that any of our citizens are
deliberately willing that their government
should default in its pecuniary obligations, or
that It's financial operations should be
duced to a silver basis At any rate I
should not feel that my duty was
done if 1 omitted any effort 1 could
make to avert such a calamity AS long
therefore provision is made for the
final red6mDtlO0 the aside of "a
currency obligation used to repeatedly
and constantly draw from the government its
gold and as long as no better authority for
bond issues is allowed than at present exists
such authority will be utilized whenever and
as often as it becomes necessary to maintain
Sufhclent gold reserve and in abundant time
10 save the credIt OF our country and make
good the financial declarations of our govern
ment Questions relatin to our banks and
currency are closely connected with the sub
ject just referred to and they also present
some unsatisfactory features
New Banking System Advocated.
Prominent among them the lack of elias
ITCHY in our currency circulation and it's fire.
quent concentration in financial centres when
it is most needed in other parts of the country
The absolute enforcement of the government
from the business of banking is the ideal rela-
tionship of the government to the circulation
of the currency of the country This condi-
tion cannot be Immediately reached but as a
step in that direction and means of secur-
Ing Il more elaSIlc currency ana ODVIatlnG
other objections to toe present arrange
ment of bank circulation the secretary
of the treasury presents in his report a
scneme modifying present banking laws and
providing for the issue of circulating notes by
state banks free from taxation under certain
limitations The secretarT explains his plan
so plainly and it's advantages are developed by
him with such remarkable clearness that any
effort my part to present t arguments in it's
supports would be surpuflous I shall there
fore content myself with an unqualified in
dorsement OF the secretarys' proposed
changes in the law and brief and imperfect
statement of their prominent features
1t is proposed to repeal all laws providing
for the deposit of United States bonds as Sc
curity for circulation to permit national
banks to issue circulating notes not exceeding
in amount 70 per cent of their paid up and
impaired capital provided they deposit with
the government as a guarantee fund IN United
States legal tender notes including treasury
notes of $780, sum equal in amount to 81
per cent of the notes they desire to ISSUE this
deposit to be maintained at all times but
whenever any bank retfres any part of its cir
culation a proportional part of its guar
antee fund shall be returned to it, to
permit the secretary of the treasury
to prepare and keep on hand ready for issue
in case an increase in circulation is desired
blank national bank notes for each bank hav-
ing circulation and to repeal the provisions
of the present law imposing limitations and re-
crease their circulation, thus permit ting such
Increase or reduction within the limit of
iseventy-hve per cent of. capital to be quickly
made as emergency arise In addition to the
guarantee fund required it is proposed to pro-
vide a safety fund for the immediate redemp-
tion of the circulating notes of failed banks
by imposing a small annual tax say one half
of one per cent upon the average circulation
of each bank until the fund amounts to five
per cent of the total circulation outstanding.
hon han all mt fI1y16 iG ffl he
paid into this safety funds and its notes are
to be redeemed in the first instance from such
safety fnnd thus au mented: any impairment
of such fund caused thereby to be made good
from the Immediately available cash assets of
said bank, and il these should be insufficient,
auch impairment to be made good by pro-
rata assessment among the other banks. their
contributions constituting a first lien upon
the s>ets of the failed bank in favor of the
contr buting banks
AS further security it is contemplated
that the existing proposition fixing the indf
vidual liability of stockholders is to be re-
tanned and the banks Indebtedness on ac-
count of its circulating notes is to be made a
first lien on all it's assets For the purpose Of
meeting the expense of printing notes, ON
Gals supervision, cancellation and other Xix
charges. there shall be imposed tax of say.
one-half of one per cent per annum upon the
average amount of notes in circulation It is
no national bank notes issued of
a less denomination than ten dollars:
L0at 6acn naIlOnal DanK, except IN case oil
failed bank shall redeem or retire it's notes in
the first instance at its own of1ce or at
agencies TO be designated by it, that no fix ed
reserve used be maintained on account of de-
posits.
Another very important feature OF this plan
is the exemption of state banks fGlm taxa
tfon by the United States in cases where 1t is
shown to the satisfaction of the secretary of
the treasury and comptroller of the currency,
by banks claiming such exemption, that they
have not had outstanding their cir culating
notes exceeding seYenty-fve per cent of
their paid up and unim paired capital
that their stockholders are individually liable
for the redemption OF their circulating notes
to the full extent of the ownership OF stock
that the liability of such banks upon
their circulating notes constitutes
under their state law a first lien upon
their assets. that such banks have
kept and maintained a guarantee
fund in United States legal tender notes in
cluding treasury notes of 1890 equal to thirty
per cent OF their outstanding circulating |
notes, and that such have promptly redeemed
their circulating notes when presented at
their principal or branch ofiee
1 conclude this communication fully appre-
ciating that the responsibility for legisla tfon
affecting the people OF the United States rests
upon their Representatives IN CONGRESS and
assuring them that whatever accord ance With l
recommendations have made OF not shall
be glad to cooperate in perfecting any legisla-
tion that tends to the prosperity aud welfare
of our people.
(Signedl GROVER CLEYELAFD.
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