The herald., 1897-12-08
SECRETARY CAGES REPORT

The annual report of Secretary of
elsewhere in this mornings Herald, first
presents the financial statistics for the
fiscal year ending June 30 1897. The
total receipts of the government were
s44S, 439 622.5O, showing a deficiency for
the year of SIS, ,052, Asa. Il. AS compared with
the fiscal year 1896, the receipts for 1897
increased S20911, 1911, while the ordin-
ary expenditures increased s13,5s4,-
713.49.
| The secretary then reviews the evils
of our present currency system and says
that his recommendations should be re-
garded as tentative steps that will lead
to desirable conditions, rather than final
measures. First, he recommends legis-
lation that will establish, separate and
apart from the operations of the treas
ury as they relate to revenue and ex-
penditures, a department to be known
as the Issue and Redemption division.
To this division should be set over S125,-
900, 900 in gold from the general fund in
the treasury, to be used only for redemp-
tion purposes; all the silver dollars now
held for redemption of silver certificates,
and all the silver bullion and dollars
coined therefrom under the act of 1890
to be passed to the same account.
Further, the sum of s2OO, 200, 900 in green
backs is to be collected and deposited
in the Issue and Redemption division, to
be disbursed therefrom only upon the re-
ceipt of an equivalent amount of gold
coin
| Second, the secretary recommends that
provision be made for the issue of re-
funding loan bonds, payable after ten
years at the pleasure of the govern
ment, to bear interest at the rate of 21a
per cent, payable, principal and interest,
in gold coin. The advantage involved in
the proposed action lies, the secretary
says, in the fact that it removes the am
biguity from our contract obligations
arising from the use Of the word coin"
In expressing obligation in public debts.
He holds that the word Is understood by
the discriminating debtor to mean gold
coin, and that such construction is
proper.
Mr.. Gage next recommends changes
in the national banking laws. He would,
as noted in the presidents S message per-
NIT national banks to be organized with
a minimum capital of $4,000, reduce the
y of 1 per cent per annum, and per-
nit banks now organized to issue circu-
lating notes to the par value of their re-
funding bonds. He would further allow
such banks to deposit as security with
the treasury greenbacks, treasury notes
or silver certificates to a total amount
of $200000,000 against which shall be is
sued national bank notes to an equal
treasury notes and silver so deposited
the secretary shall from time to time
substitute refunding bonds to the
amount of 5000, 900 900, such bonds to be
cHdTS6u W lle DdlhS DIT IIldIheI prices.
After the banks have deposited funds
according to the foregoing plan to the
amount of so per cent of their capital
stock, they shall be permitted to issue
bank notes to the extent of 25 per cent
of such deposit, without security except
the assets of the bank, the guarantee
of the government to be extended to all
circulating notes of the bank.
To secure the government against loss,
if any, attaching to it's guarantee, tax
of 9 per cent per annum shall be levied to
create safety fund. No issue of ma
tional bank notes shall be of q smaller
denomination than $40.
The secretary concludes his report
with a statement showing the menace
of the greenback to the gold reserve,
under the present conditions.
The various features of the report will
be discussed by The Herald in due sea-
son.
TIFF REFITNDTNG SCHEME