The Goodland republic. [volume] (Goodland, Kan.) 1891-1907, 1894-12-14
CARLISLE EXPLAINS HIS PLAN
Carlisle and Eckels Appear Before
the Finance Committee.
is ONLY A WALL STREET SCHEME
United States Bonds Not TO be Used as
Basis for Banking Carlisle and
Eekels Don't Agree.

/
s.as1
WASHINGTON, Dec. Secretary Car
Isle appeared before the house COM
mittee on banking and currency today
to present in detail the features of the
new currency plan proposed in his an
nual report and Endorsed in the presi-
dents message. He took up each sec
ton of his recommendation.
First, to repeal all laws requiring or
authorizing the deposition of United
States bonds as securities for circula-
ton, and second to permit national
banks to issue notes to an unimpaired
capital, but require each bank before
receiving notes to deposit a guarantee
fund consisting of United States legal
tender notes, including treasury notes
Of 1890, to the amount of 80 per cent
upon the circulating notes applied for.
This percentage Of deposits upon the
circulating notes outstanding to be
maintained at all times, and whenever
a bank retires its circulation in whole
OF in part, its guarantee fund to be re-
turned to it in proportion to the
amount of notes retired
Mr.. Carlisle said that he was satisfied
that the present law requiring the de-
post of bonds to secure circulation
prevented the elasticity of the cur
rency.
1.-THE provisions" said Mr.. Carlisle,
give ample protection without the de-
post of bonds as required by the pres
ent law"
Mr.. Carlisle said the practical value
of a reserve fund of currency was
shown in 1898. There was a demand for
money, aggregating s40,OOO,OOO. The
treasury did its best to meet the strin-
gency, but by the time the notes were
ready to distribute the demand had
gone by and many Of the packages of
notes we're returned unopened.
Chairman Springer asked how the
secretary's plan differed from the Bal
timore plan.
Mr.. Carlisle explained the technical
difference. The Baltimore plan pro-
posed deposit of 50 per cent under
certain conditions, while the treasury
plan proposed a deposit Of 30 per cent.
When a bank fails the treasury plan
contemplated an assessment on all ma
tional banks, they in turn having a lien
on the failed bank,
Representative Hall suggested that
there was a prevailing opinion that it
was unsafe to place the entire ques-
ton of expanding the currency in the
hands of corporations and banks.
ut will work automatically" said
Mr.. Carlisle, "banks will not expand
the public currency unless the public
needs it. Their interest will be to eX-
pand and contract as the common in
terests demand it. The interest will
therefore control at all times
The secretary stated that this flexi-
bility was much more desirable than
rigid system by which a fixed amount
of currency was always outstanding.
At one time the stringeRcy was so
great that the banks drew out $780,
OJO under the pressure and if it had
not been for the Canadian banks which
sent currency into this country, seri-
Gus results might have eRsued. Mr.,
johnson of Indiana, asked if the Balti-
more plan did not contemplate govern
ment liability,
Mr.. Carlisle said that the ultimate
liability was on the government by the
Baltimore plan and on the banks by
his plan.
When the committee recOnvened
Comptroller of the Currency Eckles
appeared before the committee and
made an elaborate statement. He con-
tended that the national banking laws
were not to be lightly dealt with and
that they should not be altered unless
it was absolutely known that the
change was to be beneficial.