Evening star., 1896-12-29
CURRENCY CHANGES
Some That Representative Walker
Would Recommend.
The PROSPECT OF LEGISLATION
Vital Defects in the Present system
Pointed Out.
AN INTERESTING TALK

wednesday, January O. the House COM
mittee on banking and currency, will COM
mence a series OF meetings. which nror-
Use TO be very important Ii is the purpose
OF the committee to endeavor to get some
sanitary legislation through the House
at the earliest possible moment, upon the
SUBJECT OF banking and currency and
these meetings Will be for the purpose Of
preparing the bills
chairman Walker of the committee js
now In the city and talked interestingly "a
Star reporter today
Prospect Of Liquidation.
what are the prospects of legislation In
TINS Congress and the next, to correct The
| aHeged existing evils in the banking and
currency systems?" Mr.. Walker was ask
ed ~ 7"
IL VIII depend upon the leaders of The
dominant party, and IL they are derer-
niihe1 70 nave such legislation" replied
Mr. walker. The banking and currenc,.
committee, during my whole eight years.
service Upon II, has practically had the in
erua' II not the opposition of the leaders
" me dominant party, under both the dem
ccrauc and republican Administrations ~
the House. 'iohs Vi
Beginnirg with the days of Sam Ram
oaii' Inc legislation of the House has hem
oe o9Ieentrated more and more into the hands
OF very few men. While the form and
prac tce is still preserved of appointinp
-eignt committees, who prepare leris.
, ,auoh IN answer to the demands of the
peut. peup.e VINO work laboriously as the SER
wants OF the House. very few committ..s
can get any of their measures before the
house Unless the few leaders arr earn
es.y, determinedly and persistently in IA
Cor y. any leglsiation. Il can not be mad.
I'M Somlhon remark I'm the House is that a
large proportion of the House might as
well go home as to be here" "S
Defects I'm the Present System.
"Hat are the most vital defects in the
governments present currency SYSTEM,
MI. Walker was asked.
ine most vital defect is that there is
government system. Banking is of sucb
nature that government as such can
take no part in it other than that of suner.
VISION unless the government itself is a
oanher with all the service to the public
ana risks of a banker The fact is tba,
the bankers of this country now have fo
carry every dollar of the existing currency
as compared with banks in England.
proft to the bankers While IN ot her ca,,,'
tries where the currency used by The neo
PIE is put In circulation by the bank the
sankefs that issue II make a profit upon
u OF whatever their rate of Interest on
loans and discounts are. II every do,,or
OF exlsting currency was put In circu
iauon by the banks of this country The
banks would receive about $50 OO001o in
come co,,e on ~. That would mean that they
could reduce the rates of interest they
cnarge by nearly one-third and pay their
stocKnolders the same rates of interest
on their stock that they now pay"
What He Recommends.
What would you recommend to remedy
the defects you mentionY,
Inc people having become so accus-
TONED to the currency being issued by the
general government and the constitution
OF many states forbidding state banks to
issue It, II Is not practicable TO densrr
from that custom. But as 1t Is impossfble
Tor any agency other than banks to n,,t
euti s iency IN circuiaton among the people
ana make Its current redemption safe, sure
and practically free from expense. Con-
gress should Immediately put the curren,
redemption of our greenbacks upon the
banks pro rata to their capital and COM
pensate the banks for this service which
py the way, would really cost them moth
ing as compared with present conditions.
by allowing the banks to issue an amount
OF currency equal to the sum of the green
backs Of which they assume the current
redemption. This would make a profit to
the banks on the total currency issued
OF more than three times taking the coun-
try over, what they can make by issuing
the present law"
But how would you make the currency
as safe as our present currency, which is
guaranteed by bonds?" Mr.. Walker was
asked.
The very small tax of two mills On a
dollar anr uaily, retaining the same pro-
vision as now. that the assets Of the banks
IN case OF insolvency should be used first
to pay Its currency notes, would make a
safety fund in the United States treasury
of an amount many times more than the
losses could possibly be. as shown 10y the
experience of the country for thirty years
under the national banking system /
would have the government guarantee the
payment of every dollar Of currency issued.
which would be equivalent to its being Sc
cured by bonds"
Changes In the Laws.
What vital changes would you recon-
mend in the laws regulating the national
banking systemg'
First, would release the banks from an
obligation 10 secure their currency by the
use of United States bonds. That requires
the bank to put In the hands of the gov
ernment for the safety Of their currency
III per cent of their capital to each dollar
of currency issued when they begin busi-
ness. What 1 suggest is that the govern
ment take 100 per cent of their assets to
pay each 100 per cent of their currency
notes when they go out Of business. With
the two mills tax for a safety fund the
latter Ii as secure as the former. Further
more, the use of bonds violates every prin-
ciple OF banking. as it is understood In
every other country except the United
States. 1t was adopted as a forced loan
upon the banks Had it been abandoned
Immediately after the civil war and the
government abandoned maintaining gold
reserve to redeem our currency notes. put
ting 1t upon the banks. where 1t belongs
and where It Is In every other country, we
never should have been yexed by the
greenbacks question nor the free coinage
OF silver question and the like Questions,
which will continue to vex the country
until the government goes out Of the bank
ing business"