Richmond dispatch. [volume] (Richmond, Va.) 1884-1903, 1896-12-12
THE ECKELs BANKING PLAN.

| of-the-Currency Eckels we have the de-
| tails Of the reform i'm the national-bank-
ing system suggested In the President 5
message. which suggestion. together with
| other plans of banking reform. we are
glad to see, is being discussed by many
of the leading papers throughout the
country. This discussion we regard as
an encouraging sign. Not that it fol-
lows that the Cleveland. or Eckels.
or any other plan so far preached
Is entirely practicable, or would
solve satisfactorily our financial prob
lem. Owing to the fact that we have
been going wrong so long in the national
banking system and in our general fnan-
cial policy. the questions that present
themselves to us are exceedingly difficult
to deal with But the encouragement
lies in the widespread admission. as
shown in the discussion Of the vital ne
cessty Of more currency and wider dis
tribution thereof; and. in the hope that
intelligent agitation of the whole subject
may force Congress to deal with IT as
business question. and may point the way
out Of our difficulties. To say the least.
could Congress be brought to view the
problem in the broad light of its bear
ing upon the business of the country at
large. surely that body. with the advice
and assistance OF the business organiZa-
lions of the United States. ought to be
present system.
Mr.. Eckels recognizes that the great
defect in the present system is the dearth
of currency, and the currency accumu-
lation i'm the monetary centres; also, that
the problem is paramountly a business
one, TO be dealt with along business lines.
His recognition of the tendency of the
system to concentration is found in the
statement that the money Of the coun-
try cOngests i'm the great financial CEN
tres. to remain idle or proftless, or to be
used at very small profit. only because
there seem to be no new arteries through
which it can flow" And why, we ask,
are there no new arteries through which
ii can flow? Largely. If we may so ex-
press 1t, because, outside Of the great
financial centres, there are not the ade-
quate banking facilities and currency
with which to build new arteries.
In recognizing the question as pre-emi-
nently a business one. Mr.. Eckes says
that the monetary problems which con-
front Congress- embarrass the admins
trative officers of the government, harass
the business world, and bring a plague
upon American politics, must ultimately
find solution in required banking improve
ments 1t is equally true that politics
have brought plague upon our banking
system. which fact emphasizes the wis
dom and the necessity of treating the
question of reform from business stand
point, and divorcing the system if pos
sible. from government association.
AS to the details of Mr.. Eckels's pro-
posed national bank reform, we quote
from his annual report the following,
which was covered in a general way
in the Presidents message:
"In places having a population of less
than 1900 inhabitants. national banks
shall be permitted, under regulations to
be made by the Comptroller of the Cur
rency and approved by the Secretary of
capital stock of not less than $500,
and with a corresponding reduction in
the amount Of bonds required to be de-
posted with the Treasurer of the United
States
National banks shall be permitted,
under proper regulations and restric-
TONS TO establish branch banks in
towns and villages where no national
bank is established, and where the popu-
fvl obi
such branch banks to have the right
to receive deposits. make loans and dis
counts, and buy and sell exchange, but
i'm no case 10 be permitted TO issue cir
culating notes. other than of the parent
bank 1t shall in all respects be con-
sidered as a part of the parent bank,
and in each case where such branches
are maintained the Comptroller shall
receive in the reports of the central
bank a statement, properly sworn to
and attested, of the condition Of the
branches. He shall also have the right
of separate and independent examina-
lions, and he may, whenever he deems
il necessary require, before granting the
right TO any bank to maintain branches,
that the paid UP capital stock of such
bank be increased to an amount to be
by him fixed. with the approval of the
Secretary of the Treasury
"The semi-annual tax on circulation TO
be reduced to one-fourth of l per cent
1.-THE issue of circulating notes to the
par value of the bonds deposited to be
permitted"
A knowledge of these details is. We
think. essential I'm order to an intelligent
understanding of the discussion of the
plan that seems likely to continue in
the papers, and will probably occupy
good deal of the attention OF Con-
gress. And In this connection II will
also be interesting to know wherein
mainly the Eckels plan differs from
the Carlisle plan and the Baltimore
plan, which are also coming to the front |
again. Mr.. Eckels clings to the bond |
deposit feature as note security. The |
Carlisle and Baltimore plans, anticipat- |
ing the time when government bonds |
may be wiped out by redemption, pro-
vide for the issue Of notes without the |
security of a deposit of bonds in the |
Treasury, and are said TO be based on |
the experience OF Canada. Scotland. |
France, and other countries. which |
demonstrates that such note security Is |
not necessary. The Carlisle plan con-
templates issues up 10 Is per cent. OF |
paid-up capital. and requires a guarantee
fund TO the amount Of 30 per cent OF |
outstanding notes, together with other
safeguards. Mr.. Carlisle provided fur
Their In his plan for the repeal of the
tax on State-bank notes under certain
conditions The Baltimore plan would
permit the issue of notes up to 80 per
cent. of paid-up capital. and. as Is
the case with the German system. pro-
vides for elasticity by allowing. In emer-
aAd