Rock Island Argus. (Rock Island, Ill.) 1893-1920, 1897-12-06
CURRENCY COMPTROLLER.s VIEWS
wants the Government 10 Go Out Of tn,
NOte-issuing Business

Wants the Government 10 Go Out ,t n.
Note-Issuing Business
Washington. Dec. 6.-The annual re.
port of James II. Eckels, comptroller
OF the currency. for the year ended
oct. 81. 1897, invites the attention of
congress TO amendments to the law rec
commended in former reports without
specifically repeating them On the
subject OF bank note circulation the
comptroller says: 1T is noticeable that
in all the changes which have been
wrought in the national currency act
from lis inception TO the present time.
the feature subject to criticism. but
which was intended should constitute
the principal benefit to be conferred
has remained comparatively un-
changed; namely. the note issuing func
ton. Whatever justification there was
In the first instance for restricting the
issuing of notes against the bonds of
the government deposited with the
treasurer of the United States to 90 nor
cent OF the par value thereof long since
ceased" but ''the law still remains
without amendment" in spite of the
recommendation Of every comptroller
AL tHe past twenty years.
The business Of banking, like avery
other form of investment. must be mada
attractive 10 capital II is CON
sidered by every great commercial gov.
ernment except the United States to ba
the sole province of the banks to issue
the paper which circulates as currency
The belief in bank note currency as
being better and safer than a govern
ment paper currency prevailed unuues-
toned in this country until. under the
apparent eXigencies OF the war, the
government undertook to issue paoer
currency. Even under such circur-
stances, the promise was always given
that 1t Should be retired at the earliest
practicable moment, and the admission
freely made that it was neither a wise
measure ner a safe form of currency.
Between the competition of the gov
eminent note issues on the one hand,
and the unnecessary restrictions i'm
posed by law upon the other. together
with the increasing price OF bonds re-
quired to be deposited as security. the
note issuing function of the banks has
been permitted to become merely an
incident to the conduct Of the national
banking associations of the country. l.
has been seriously suggested more than
once that the bank note issues be done
away with and all paper be issued by
the government instead. The danger
or such course is not to be oyer-esti-
mated. The experience of every gov
ernment has been that governmental,
currency paper is source of weakness
ana Canger. The argument that
the government, better than the banks.
can provide for the redemption Of paper
note issues win not stand the test of a
careful analysis.
The government has no means for
caring for its demand liabilities except
through borrowing and through the
levy OF taxes. Upon the other hand tho
banks have assets which can lie prompt
ly converted into cash to meet their
outstanding notes when scented
Their ability to command gold has al
ways been beyond that of the govern
ment, for in each financial eXigency
which has confronted the government
the banks have furnished to il the
amounts necessary to maintain its SOL
NenSy. The Bank of England,
the Bank Of Scotland and the Bank of
Ireland have been found to be ample I'm
their resources to provide the note is
sues for Use in the trade Of the United
Kingdom. The same is true of the
Bank of France" The German Imperial
bank Is also cited.
IN the statistical part of the report
the comptroller gives the latest compile!
statistics relative to the worlds none
tary systems ard the stock Of gold,
silver and paper currency. A very in
teresting feature of this statement is
the per capita amount of each kind Of
money in the countries named. The
per capita averages in the principal
countries of the world are as follows;
United States. $3.50: United Kingdom,
s-o.e5: France. s3ieS: Germany, sls95,
Austria-Hungary. ss.33. and Russia
ssa5. The comptroller renews his rec,
emmendation Of last year. urging that
national bank examiners be paid an
annual salary instead Of fees as now.
y