Middlebury register. (Middlebury, Vt.) 1886-1937, 1896-09-11

Inc following pertinent lleul Ill IcSdlW u
to our paper money is from recent issue
of the Boston Herald, which paper, as
appears from this and as we haye before
noticed. is an earnest and consistent
believer in the advantages of the govern
ment alone issuing our paper currency:
To the Editor of 7 he Herald
l. WHY does the government allow the
national banks to issue $50 on every 500
government bond, which draws from to
per cent, beside giving them the use of
$50 national bank notes to loan at interest,
thereby drawing interest at both ends?
,. If the treasury notes are legal ten
der, therefore superior to silver certifi-
Gates and national bank notes, why does
not the government issue all notes:
3. Why should the government give
the national banks power to curtail their
circulation at their will?
1. Have not the national banks the
power to contract or increase the circu-
iation at pleasure, thereby being able to
bring on a stringency or plethora in the
money market in a moment?
,. What is the amount of treasury
notes in circulation at all times:
6. Is there any difference between a
private debt and public debt-that is,
government debt?
Boston. Sept. l. INQUIRER.
|. The original theory was that the
right of Issuing paper money would lead
to a wide adoption of the national bank
ing system, that the national banks would
assist the government in placing its loans
and the bank notes would be less in
furious than government notes in their
Initiative effect. These reasons are plaus-
ible, put they do not bear examinations
If the government had issued its own
notes instead of giving the banks the
privilege of issuing notes on its credit, it
would have saved very large amount of
money without increasing the volume or
impairing the value of the paper currency.
The channels of circulation in which the
bank notes floated. to the exclusion of
government notes. would then have been
open for the use of the latter
2. In our opinion it would be sound
policy to have only one form of paper
money, and to contide the management
of this form to national Office of issue
quite distinct from the ordinary opera
tions of the treasury. We have an abid-
ing faith that ultimately some such ar
rangement will be effected.
power to curtail their circulation at will,
The total amount that they can retire is
limited to S3,000,0 GOO month. The act
of July y, 1882, provides that not more
than $3,000,000 of lawful money shall be
deposited during any calendar month for
the withdrawal of national bank notes.
1. They can increase their circulation
to any amount. subject, of course, to the
restrictive conditions of the law but as eX-
planned in our reply to the third question.
their power of contraction cannot eX-
ceed So, 100000 month. So long as the
banks have the privilege of circulating
notes, it is entirely proper that they
should have the right of reducing or in
creasing the volume of their individual
issues.
). The amount of the United States
notes (greenbacks) is fixed at S34G, ,GSl,-
0lG. The treasury notes of 1890 (Sher-
man notes )have no fixed amount, being
steadily reduced by Secretary Carlisle
policy for the coinage of the seigniorage,
Their amount on the lst instant was
Sl26, N $50. The aggregate for the two
forms of legal tender notes is Sl73 ,422, )
296.
6. Morally, there is no difference, for
honest men and honest governments pay
their debts without qulbbling or scaling,
unless they are absolutely unable to do
so. Sentimentally, however, government
obligations are regarded as especially
sacred, because if government does not
choose to pay its debts there is practically
no way of collecting them.- Ed.