The daily morning Astorian. [volume] (Astoria, Oregon) 1883-1899, 1897-12-09
SECRETARY GAGE
ON The CURRENCY
Issue and Redemption Department Is
0Rec0mmended.
GREENBACKs TO BE RETIRED
And 0nIy rsid 0ut for Gold-XatiopsI
Banks TO BE Established Of
Small Capital.

secrciary Of the Treasury Gage. In his
revsw Of the currency question, in his
annual report. crowded out Of yesterday s
Issue. after dealing with rhe details Of the
evils of the present system, offers the fol-
rowing recommendations. OF which he
says:
The recommendau cons make must be
construed as tentative steps in a dlrec-
uon whbh. II constantly pursued. will
ultimately lead TO conditions theoresic-
ally desirable rather than as being in
themselves final measures to THAI end
The condition of the treasury In its rela-
tion 20 demand obligations requires that
one OF Two steps be taken. The one may
be large reinforcement Of ths permanent
gold reserve; the other may be by an
Important reduction in the Questionable
form OF liabilities. The latter Is. in my
oIHnion. the more desirable. First. I rec
0mmend that proper legislation be enacted
wfIich will establish. separate and apart
from the ordinary operations Of the treas.
ury as they relate TO revenue and expendI-
lures. a department. to be designated and
known as the Issue and Redemption al.
vision. To shis division the sum Of N25.-
ooo.0oo IN gold should be set over from the
general fund In the treasury. to be used
only for redemption purposes and all the
silver dollars now held for redemption OF
silver certificates and all the silver bullion
and dollars coined therefrom. bought un-
der the act OF 1890. should be passed 10
the same account Further. that the sum
Of 100000 In legal tnder notes OF the
United States known as g-eenbacls be
colicrted as hereinafter described and
deTnsted In the said issue and redemp-
tion division. to De disbursed therefrom
only upon the receipt in exchange there
for OF an equivalent amount Of gold coin.
Such gold, when 50 secured TO be held
In said division as part Of the general re-
demptson fund. Second. recommend that
provision be made for the issue of re-
funding loan bonds, payable after ten
years at the pleasure OF the government.
such bonds 10 bear interest at the rate
Of 2i9 per cent per annum, payable prin-
cipal and interest, in gold coin: and that
the SECRETARY Of the treasury be authc--
ICED TO issue such bonds and receive in
payment therefor with an equitable allow
ance for the difference in interest. any
part or all Of the outstanding loans OF
the United States which mature by their
terms of payment in the years 1904. 1907
and 19s5''
Continuing, he says:
The advantage involved in the proposed
action lies in this: 1t removes an ambig-
uity from our contract obligaJions-an
ambiguity which affects unfavorably the
governments credit The word coin now
used to express the obligation In the
public debt. Is an ambiguous word. It is
no doubt und 'rStood by the more dis
crdminating public creditor to mean gold
coin. and The solemn act of congress
pledging the maintenance Of silver coin
upon a parity with gold coin makes It
impossible to construe the word coin as
therein used. TO mean anything other than
gold or IT'S fun equivalent. Yet. as this
is conclusion of logic, rather than a
clear statement OF fact. the simpler and
more humble investors or would-be in
vestors in the public debt are confused
and doubtful and the public credit is
weaker therefor"
The SECRETARY then goes on TO show
that the course suggested has a precedent
in the act Of congress of 1869. pledging
the government to the payment Of all
nterest-bearing obligations in coin or its
equivalent To obviate the difficulties in
the way of this method Of supplying the
deficiency he recommends the following
changes in the national banking law:
First-Permit national banks to be or
ganized with minimum capital of $4,000
in any place having a populations of 1000
Inhabitants or less
Second-Reduce the rate Of taxation on
circulating notes secured by deposit ci
hOhuS W biiN-ldll VI biAt HNA SNHN PSA ehAA-
mum.
Third-Permit banks now organized or
hereafter organazed to issue circulating
notes to the par value Of the refunding
bonds hereinbefore suggested. when de-
posted by them with the treasurer Of the
United States; and. further, allow such
banks as shall avail themselves OF the
opportunity TO deposit as security with
the treasurer Of the United States green
backs. treasury notes or silver certificates
to a total amount of $2OO,OOO,OOO. against
which there shall at once be issued to
them by the controller Of the currency
national bank notes to an equal amount,
It being further provided that from time
TO time, at his convenience. the secretary
of the treasury shall substitute for The
greenbacks. treasury notes and silver GER
tifcates so deposited to secure circula-
tion bonds Of the same class and char
acter as the refunding bonds first named
to the amount of s2OOOOO.OOO such bonds
10 be chargable to said banks and by
them accounted for at such price mot less
than par) as the market quotations may
indicate to be their fair market value.
During the period Of time intervening be-