Rock Island Argus. (Rock Island, Ill.) 1893-1920, 1897-10-28
CAGES FINANCE PLAN |
Based on the Most Radical Gold
Standard Principles in Every
Proposition It Contains.
FIRST CONES A2l-2 PER CENT BOND

Payable, Principal and Interest, in Gold.
to Refund the Debt and Retire the Green
backs and Treasury Notes-Government
to Go Entirely Out of the Banking Busi-
ness-As to Currency-Further rs to the
Union Pacific Sale.
Washington, Oct. 2S.-Secretary Of the
Treasury Gage read to the president
and the cabinet the recommendations
as to financial legislation which he VIII
make to congress in his annual report.
He proposes to strike at the root of all
the difficulties that have embarrassed
the treasury durAg the last few years
by recommending that the country be
put unequivocally upon the gold basis,
and that the treasury be taken out of
the banking business. Such radical
legislation as he proposes may be i'm
possible to secure, but if his advice IS
not followed he will throw upon con-
gress the responsibility for refusing TO
correct rhe defects of the present cur
rency system.
Keynote of the Secretary's Plan.
The keynote Of the secretary's scheme
Is the refunding of the present bonded
debt of the country in gold bonds hear
Ing 21s per cent. interest. He believes
that bonds which declare on their face
that they are payable. principal and in
terest, in gold. can easily be sold at that
rate. AS most Of the present bonded
debt OF the country bears interest at
and per cent, the annual saving in in
terest by refunding would be about s17.-
100000. This would more than pay the
int or
per cent. gold bonds which would have
to be issued to carry out the second
feature Of the secretary's plan, which
| is the retirement of all the outstanding
greenbacks and Sherman notes, SO as to
Lease no notes whatever outstanding
| which could be used to drain the treas
! W'y of gold.
How Ec Would supply Currency.
With the retirement Of the Sherma Il
| notes the government would be left with
| slver bullion in the treasury vaults pUr-
chased under the Sherman law at a cost
| of $iOI eG0G0O. This could either be
| sold at the market price of silver or it
| could gradually he coined into silver
| dollars to the amount of 1925 1000, 900.
| To take the place of the currency Sec
| rotary Gage VIII propose that the banks
| be allowed to issue notes up to the par
| value OF the government bonds de
| posted by them and he believes that
practically all of the additional bonds
| that would be issued to retire the gov
| ernment notes would be absorbed by the
| banks as basis for circulation. He VIII
| also propose something on the line OF
| the so-called baltimore plan, whereby
| banks will he allowed to issue addition
al circulation, probably up TO % pei
| cent. Of their capital stock, ample pro-
| vision being made for its security.
| Circulation In Free Silver States.
He will also recommend that the tax
on national bank circulation be reduced
| to just enough to cover the expense OF
administering the law and supervis.
| ing the banks. In order to give in
| creased circulation to the southern
states and other localities in which tht
| silver movement gained strength chiefly
on the ground that more currency wai
needed for transacting the business o.
the country, the secretary will recon-
mend that national banks be permitted
to organize with $4,000 capital. 1t i!
believed that such q provision, coupled
with proper safeguards to protect cir
culation, would give to these communi
ties safe and somewhat elastic cur
rpncy which could be put out by TIL
local banks as it would be needed 70
moving the crops or meeting any othe
| demand for money.