New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1894-12-11
EXPLAINED BY CARLISLE.
THE SECRETARY ARGUES IN FAVOR OF
HIS NEW CURRENCY PLAN.

~ HEARINc BstcHE THE BONH" ScfNilIEB OH
BANKING AND CURRENCY SOME POINTS NOT
CLEARED uP-coNTroLLER EcKELs
ALSO MAKES sTATEaENT
[BY rELEonhpH TO rrE rHrpvsgJ
Washington, Dec. f0-Cherman Springer. Of
the Committee OF Banking ard Currency. to-day
occupied the same seat that he flied as chairman
OF Ways ana Means Committee IN tho LIId Con.
gress when he exploiting his Invention OF
"popgun' tariff bills. the patent for which has
since been infrtnged by the LfIId Congress. The
public interest in the question Of currency-legis-
lation Is great that Chairman Springer CID
wisely in obtaining the use Of the spacious room
CT the Ways and Means Committee for the series
Of hearings that was opened this morning when
the Secretary Of the Treasury submitted his plan
and began to explain end defend Il. TIE room
was crowded during the tw, hours and half
that he devoted to that purpose. re Will ap-
pear before the committee again Tomorrow.
Chairman Wilson. Of the Ways ard Means Com
mittee and many other IN ,rbers Of the House
of Representatives, besides the members Of the
committee were attentive listeners TO the Secre-
tarys statements. az ais, Sehor Romero.
fhe Mexican Minister and Horace White. and
Thomas G.. Sherman, of Ncw-York Mr. White.
who is expected TO address the committee to-
morrow. sat near Chairman Springer throughout
The day. and before the afternoon sitting ended
he asked Controller Eckels a question that
seemed to cause the latte: some embarrassment.
II was In effect whether in his opinion, the
Carlisle plan would furnish currency system
that would be sufficiently flexible to meet the
demands OF the country. The CONTROLLER avoided
direct answer
Secretary Carlise's statements we're as clear
and terse as his utteranc,s usually are. but II
apparent that nc bad not formed definite
conclusions as to some details Of his scheme. and
that in regard to some points suggested by MEM
bers of the committee he not ready to ex-
press decided opinions. Some OF his statements
and admissions bo n important and sig
nincant and 1t was apparent from the tenor Of
many of tire questions addressed TO him by men,
bers Of the committee. tha. several OF them did
not agree either with his conclusions or his opin-
ions of the practical results Of his plan. The
questions also made 1t evident that the members
differed as widely with one another as any one
Of them did with the Secretary of the Treasury.
This was especially true while the State bank
feature Of the scheme was under discussion. The
friends Of unconditional repeal of the State bank
tax evidently regarded the proposed conditions
Of repeal as too stringent and onerous-"dstinct-
ly unfrendly to the State banks" Mr.. Cobb.
of Alaban a.. phrased t-while on the other hand
the OppOne nts OF the dOuDIe-neaded system or
currency advocated by Mr. Carlisle were ready
- insist that under the proposed scheme OF
legislation the State banks would have every
thing their own way and National banks would
cease to be banks Of issue.
Secretary Carlisle took up successfully and ex-
plalned the several provisions Of his scheme. He
dwet upon the necessity OF legislation which
would not only provide a safe and flexible
elastic currency, but also relieve the National
Treasury from a part of the burden that now
bears it down. Under a system that required the
deposit Of a bond worth SIP or sll5 in the market
u obtain 800 Of circulation elasticity out OF
the question. The Secretary argued that his plan
requiring the deposit of $50 in legal-tenders for
each 500 Of notes issued to amount not ex-
ceeding - per cent of banks paii-up and un-
impaired capital. the creation and maintenance
Of a safety fund Of per cent of the total out
standing circulation of National banks. retaining
the individual liability provision to stockhold-
ers. and making the circulating notes first lien
on all the assets OF the bank. would provide all
the safeguards necessary to protect noteholders
and inspire confidence in the National bank notes
issued thereundsr He also argued strongly
against the requirements which compel National
banks 10 keep a reserve account Of deposits
Controller Eckels. in his statement later in the
day, remarked that 1t was an open question
seemed T. lean toward the affirmative side.
Secretary Carlisle pointed out one defect in the
present law-the lack OF authority to keep blank
notes on hand for issue To the banks when they
are needed. In the summer of 1893, he said, cur
rency was at premium. and the banks called for
$40 600 900 Before the notes could be prepared
and sent to the banks the demand had fallen
of and several millions of the news notes were
returned for cancellation in the original pack
ages in which they were shipped from the Treas
ury-the seals not having been broken.
The Secretary gave full explanation or the
safety fund provisions of his scheme. and showed
how they differed from the so-called Baltimore
plan In his scheme the Government is relieved
from all responsibility on account OF the redemp-
ton of notes of failed National banks; under the
Baltimo'e plan, IN case a bank tailed ana ne
safety fund should be impaired or prove insufi-
cienl to redeem all its notes. the Government
would have e. meet the deficit and look In the
assets of the bank for reimbursement Secretary
Carlisle also strongly advocated the repeal of
Section of the act Of July IL, 1882. To prevent the
rapid expansion or contraction OF National oanX
circulation. He did not believe any danger would
result from the repeal. and contended that the
business and commercial interests OF the country
would always determine whether expansion or
contraction was necessary and the banks. with
a keen regard for their own interests. would
quickly respond. The sudden withdrawal from
circulation of $lS0Oo000 Of National bank notes in
thirteen days IN 1851. he said led To the passage
of the act of 1882. but that extraordinary with
draWal was caused by a general misapprenension
throughout the country OF the meaning Of Section
> of the refunding bill that President Hayes We
tOeG
SECURITY FOR THE NOTES.
In reply to a question by Mr. Hall, of Missouri.
as 10 which plan--the Baltimore plan or the car
Isle plan--would give the best security for the
redemption OF the notes OF failed banks. the Sec
retary replied that the security would be the
same as far as the safety fund was concerned
that his plan also provided for guarantee de-
posit of 80 per cent Of the capital Of each bank
which would be cvailable for redemption pur-
poses and that under the Baltimore plan tne
Government would be liable for any deficit, whiie
under his own plan the solvent banks would
have 10 make good any deficit and depend LOT re-
imbursement upon the assets of the failed panK
or banks Mr.. Johnson called attention TO