The record-union., 1896-12-08
OUR FINANCIAL METHODS.
The President Points Their Weakness
and Vices.

The President Points Their Weakness
and Vices.
This reference to the condition and
of our revenue naturally sug-
gests an allusion to the weakness and
vices of our financial methods. They
have been frequently pressed upon the
attention of Congress in previous Tx
ecutive communications. and the inev-
liable danger of their continued toler-
alton pointed out Without now re-
peating these details. I cannot refrain
from again earnestly presenting the
necessity of the prompt reform OF a
system opposed to every rule of SOUND
finance, and shown by experience to be
fraught with the gravest peril and per-
plexity.
The terrible civil war, which shock
the foundations of our Government
more than thirty years ago, brought IN
its train the destruction of property,
the wasting of our country's substance
and the estrangement of brethren.
These are now past and forgotten. Even
the distressing loss of life the conflict
entailed is but a sacred memory which
alive tender regard for those who no
bly, died. And yet there remains with
us to-day, in full strength as an incl
dent of that tremendous struggle,
feature of its financial necessities, not
only unsuited to our present circum-
stances, but manifestly a disturbing
menace to business security and an
ever-present agent of monetary dis
tress. Because we may be enjoying a
temporary relief from it's depressing
influence, this should not lull US into
false security nor lead us to forget the
suddenness of past visitations.
PAPER CURRENCY SHOULD BE
WITHDRAWN
I am more convinced than ever that
We can have no assured financial peace
and safety until the Government cur
rency obligations upon which gold may
be demanded from the treasury are
Withdrawn from circulation and can
celled. This might be done, as has been
heretofore recommended, by legislation
tor long-term bonds, bearing a low rate
of interest or by their redemption with
the proceeds of such bonds Even if
greenbacks We're thus retired it is
probable that the treasury notes issued
in payment of silver purchases under
the Act Of July H. 1890, now paid i'll
gold when demanded, would not create
such disturbance as they might from
time to time when received in the
treasury by redemption in gold or
otherwise, be gradually and prudentIy
replaced by silver coin.
This plan of issuing bonds for the
purpose of redemption certainly ap.
pears to be the most effective and direct
path to the needed reform. In default
of this, however, it would be a step in
the right direction if currency obliga-
tions redeemable in gold, whenever so
redeemed, should be cancelled instead
OF oelng reissued. This operation
would be slow remedy, but it would
improve present conditions.
National banks should redeem thai.
own notes. They should be allowed RI
issue circulation to their par va1ue of
bonds deposited as security for tic 70
demption, and the tax on their circulo-
ton should be reduced to one-fourtb or
one per cent
In considering projects for tha no.
trement OF United States notes ana
treasury notes issued under the law
OF IS9O l am of the opinion that ,ra
have placed too much stress unon ~
danger of contracting the currano, .na
have calculated too light unon tba go
that would be added to o,,r o;ra,,,...
II invited to US by better and sofar
contraction OF our currency that
shouio De avoided as unequal distribu-
tlon. rms might be obviated and anv
rear OF harmful contraction at the same
time removed by allowing the oreani.
zation OF smaller banks and in loco
populous communities than arc now
permitted and authorizing banks to &C.
tabllsh branches in small communities
under proper restriction.
ABANDON THE BANKING R1rc1
NESS.
The entire case may be presented bv
the statement that the dav of sancih1o
and sound financial method viii -
dawn upon us until our Government
abandons the banking business and 49,,
accumulation of funds and confines y,
monetary operations to the receipt of
the money contributed by the people for
its support and to the expenditure of
such money for the peoples benefit
Our business interests and all good
citizens long for rest from feverish aoi-
tation and the inauguration by the Gov
ernment of reformed financial nn,icv
which will encourage enterprise and
make certain the rewards of labor and
industry.