The progressive farmer. [volume] (Winston, N.C.) 1886-1904, 1897-06-08
AN ] z
Correspondence Of the Progressive Farmer.
KANSAS CITY, Mo

OF the failure Of the bank was found
to be due to the investment of the peo-
pies money in apparently worthless
securities. The president and cash
Ter Of the bank were both found to be
defaulting in the appropriation of
funds thus deposited, and the cashier
was indicted before the grand jury
and sentenced to four years in the State
pe~nitentiary. The conviction Of the
president was prccrastinated upon one
pretext and another, and as time pro-
crossed, the likelihood Of his convic-
ton became more remote. The disap-
poinment sustained by depositors in
their losses in the defunct bank was so
great that two or three of them com
mitted suicide. The other day the
Governor of the State pardoned the
cashier after he had served but half
his time, as his wife was reported to
be dying of a broken heart and was
not expected to live until he could see
her.
The above ia simply drawn up as a
synopsis upon which to draw q moral
and suggest a possible remedy to pre-
vent q recurrence Of such things here
and in other places. Ia the first place,
b imprisonment or punishment in
ficted upon defaulting officers is no
just compensation to losing depositors;
it is simply q matter of personal gratrs
fcation. / know that the argument is
advanced that it acts as q warning to
others, who might be tempted to do
the same thing; but the continue
ton of such practices is q refuting ar
gument. The sum and substance of
the punishment Of offending officers is
that it acts as personal resentment;
but does lot in any sense reimburse
the victims of insolvent institutions.
The sentiment of the public against
such men appears to be more of a de
mand for vengeance than a demand for
protection. They fail to see that the
system is responsible for such things,
rather than the men who yield to the
the temptations off9red. The present
system of private banking is directly
responsible for such q condition Of Rf-
fairs. If the people wish to borrow a
few dollars from the bankers they
must give security but no security is
demanded by the people when the
bankers take their money. Under
present operations, the system of
banking becomes purely a matter Of
faith and trust, and when such a trust
is violated and the public sustain heavy
Losses, thay clamor for the punishment
of offending individuals, when they
should inaugurate q new system of
safety and protection.
We are not without some logical sub
stitute for private banks, for the Pos
tai savings system is, in every sense, a
practical remedy on the premises.
Under such a system the money of the
people would be deposited with the
Government, and not with individuals.
Any shrinkage in the value of real es
tate or other forms Of securities would
be sustained by the whole people, and
not by communities, as is the present
status Of affairs. In case of default or
embezzlement on the part Of trusted
employees Uncle Sam would deal with
the matter in a manner to obtain obe-
dience and prohibit it's recurrence.
Government inspectors would go over
the accounts to hold trusted employees
to periodical account. The profits of
the business would go to the whole
people and the losses sustained accord
ingly, and no room would be left for
private snaps. The best feature Of the
whole thing, however, would be the
protection offered to needy depositors
who had their all at stake in such in.
situations, for the Government and the
people back Of it would act az an as
surarce to ~depositors.
During President Cleveland's admin
istration 1862, 600, 900 was borrowed
from English capitalists and American
agencies in behalf of the Government
with interest at 4 per cent. How much
better it would have been to have Dor
rowed that sun from the people Off the
necessity justified IT'D and let them
have the security the Government
offers and save them from the peril of
private banking.
Or better still: If the necessity does
not exist for the Government to place
itself in a borrowing attitude, let it
stand as the Building and Loan Asso
Citations do and act as a mediator be
tween borrower and lender at very low
rates Of interest. Under private man
agement, yer the Building and Loan
H1nOia%T0nd n GEEahr - g.