The evening times., 1897-12-06

The banks are not required to redeem in
gold. The Government is obliged to Keep
equal with gold all its outstanding currency
and coin obligations, while its receipts ere
not required 10 be paid in gold. They Gre
paid in every kind of money but gold. and
the only means by which the Govarlnsnt
can with certainty get gold is by borrowing.
1t can get il in no other way whsn ii
most needs it. The Government without
any fixed gold revenue is pedg I'd to main
tain gold redemption. which it has steadily Y
and faithfully done and which under the
authority now given it will continue to do.
The law which requires the Government.
after Ia wing redeemed its United States
notes, to pay them out again as current
funds, demands constant repienishment
of the ec!d reserve. This is especially SO
enues are insufficient to meet the ex-
penses Of the Government. At such times
the Go, eminent has no otner way tosupply
its deficit and maintain redemption but
IL Tie 'iSTtdst VI It's DSNiuet 'lcDI is
during the Administration ormy rr eiecesstr,
when $26c 81 Is 400 OF - per cent bonds
Were issued aud sold and the proceeds used
to pay the expenses OF the Government in
excess OF the revenues and sustain the gold
reserve. While 1t is true that the greater
part OF the proceeds of these bonds were
used to supply deficient revenues, con
siderable portion was required to maintain
the gold reserve.
The Sale of Bonds.
With our revenues equal to our expenses,
there wodld he no deficit requiring the
issuance OF bonds. But il the gold reserve
falls below 100000, 900, now will it be
replenished except by selling more bonds?
Is there any other way practica bile under
existing law" The serious question then
is, shall we continue the policy that has
been pursued in the past; that is, when the
gold reserve reaches the point of danger,
issue more bonds and supply the needed
gold, or shall we provide other means to
prevent these recurring drains upon the gold
reser~e' II no further legislation is had
and the policy Of selling bonds is to be con-
timed, then Congress should give the
Secretary OF the Treasury authority to
sell bonds at long or short periods bearing
a less rate OF interest than is now author
lied by law
/ earnestly recommend as soon as tn :
receipts of the Government are quite sui
ficient tc pay all the expenses Of the Gov
emmett, that when any of the United
States notes are presented for redemption in
gold aud are redeemed in gold. such n1 .es
shall be kept and Set apart, and only pa
out in exchange for gold, This is an OBJ
vious duty. If the holder Of the Uaite ed
States not e prefers the gold 4 nd gets it from
the Government, he should not recei re
back from the Government United states
note without paying gold in exchange
for it The reason for this is made all
the mole apparent when the Government
issues an interest bearing debt to provide
gold for th" redemption of United States
notes-a non crest bearing debt. Surely
1t should not paythem cut 4 gain except IN
demand, and fol gold. If they are put
out in any other way. they may return
again to be followed by another bond issue
to redeem tEem-iinother INTEREST," t-bearing
debt to redeem a non int erest-bearing .,ebt.
In my view, it is Of the utmost imp1It-
ancc that the Government should be reIi .ved
from the burden of providing all the gold
required for exchanges and export. This
responsibility is alone borne by the Gov
eminent without any of the usual and
necessary banking powers to help itself.
The banks do not feel the strain Of gold
redemption. The whole strain rests upon
the Government and the size of the gold
reserve in the Treasury has come to be,
with or without reason, the signal of
danger or Of security. This ought to De
stopped.
Secretary Cages Plan.
If VIC are to have an era of prosperity
in the country, with sufficient receipts for
the expenses of the Government, we may
feel no immediate embarrassment from our
present currency; but the danger still eX-
lists and will be ever present menacing
us SO long as the existing system con
tinues. And besides it is in times of ade-
quate revenues and business tranquility
that the Government should prepare for the
worst. We cannot avoid without serious
consequences the wise consideration and
prompt solution of this question.
The Secretary of the Treasury has ont
lined plan in great detail; for tine purpose
of removing the threatened recurrence of a
depleted gold reserve and save us from
future embarra assment on that account. To
this plah i invite your careful consider 4
ton.
1 concur " ith the Secretary of the Treas
ury in his recommendation that national
banks be allowed to issue notes to the face
value OF the bonds which they have de-
,osited for circulation, and that the tax
on circulating notes secured by deposit of
such bonds be reduced TO one-hal Of Gne
per cent per annum. l Also Join hin in
recommending that authority be given for
the establishment Of national banks with
minimum capital of $4,000. This Will
enable the smaller villages and agricultural
regions of the country to be supplied with
currency to meet their needs.
recommend that the issue of National
bank notes be restricted to the denom!na-
ton of ten dollars and upwards. II the
suggestions have herein made shall have
the approval OF Congress. then I would
recommend that National banks be re-
Quired to redeem their notes In gold.
THE CUBAN PROBLEM.
The most important problem with which