The Seattle post-intelligencer. [volume] (Seattle, Wash. Terr. [Wash.]) 1888-1914, 1897-12-20
RETIRE THE GR[ENBACKS.
HORACE WHITE WRITES TO THE
MONETARY COMMISSION.
ne Wosid Even Redeem silver In
Go1d-Notes BASED en- Assets-The
silver Dollar should Be Conafd-
cred Only . Metallic Gr~enhaek.

Goid-Noses BASED en- Assets-Thc
silver Dollar should BE Consid-
/ cred Only . Metallic Greenbaek.
Horace White. OF the New York Even
s Ing Post. and finance expert has sub
miIfed answers 10 the interrogatories Of
TIE monetary commission at Washing
lofs. Mr. White is an advocate of the re-
usmption or greenbaeks and the adopt
ing OF an elastic banking currency based
upon business assets He declares that
the silver dollar should be redeemed in
soso- and that in a financial sense there
+ Is no difference between the several forms
OF government fiduciary circulation %
which silver dollars are a par The lat
yer. ne declares. are metallic greenbacks.
he does not believe that the amount of
circulation presented for redemption would
De any greater than at present If silver
We're redeemaSle in gold. In answer To
tns Questions regarding the maintenance
OF the gold standard. Mr.. whise says:
would recommend the redemption
retirement and cancellation of ali legal
tender notes. as the first action. Proba-
Oily the silver certificates and silver dol
lars would thereafter remain at par with
gold, like the outstanding thalers Of Ger
many, and would not DE presented for
redemption In any considerable amount
being needed. like the smaller silver coins.
Tor circulation in retail trade After the
retirement OF the legal tender notes we
should De able to see better what TO do
next"
For the purpose OF facilitating the use
or existing free currency, what do You
recommend as the smallest denomination
OF United States notes and bank notes
winch should be put in circulation?
len dollars at first. but this should be
matter of experiment, the object being
10 determine the dimensions OF the field
OF circulation which will absorb the sill
yer currency. leaving the rest TO bank
notes.
In regard to the legal tender notes. Mr..
whites responses are as follows:
Tn what grounds. If any. would You
favor the gradual but entire withdrawal
OF the treasury notes of 1890 and of the
United States notes?
On the ground that there is no GER
tainty and can be no certainty that the
government will always redeem them in
gold. Redemption or non-redemption is A
political issue to be fought over in cleo
tlons, ana must remain SO as long as this
KIND OF paper is outstanding Mere UNI
certainty is always a drawback to BUSH
ness prosperity. Failure of redemption
would be bankruptcy. public or private.
No New Bonds Issued.
III II shall be decided TO retire the
United States notes how can Ii be done
without adding to our bond debtg
BY canceiiing all that we receive at
the treasury for taxes or presented for
redemption. or also so received over or
above the governments necessary dis
bursements.
How in that case can provision be
made for maintaining adequate
amount OF currency available for nur-
poses Of business?
Provisions would be made automati-
caily I'm various ways. I-Ry retaining
the gold produced by our own mines.
BY importing gold from abroad. g.
By the issue OF national bank notes
Prior 10 the civil war the government
gave Itself no concern about providing
currency for purposes of business yet the
supply was never deficient.
Ii 1t be thought inexpedent to fund
the United States notes. how can they be
redeemed with an assurance that bank
currency will take their place?
The assurance is found in the fact that
IN every case where a currency vacuum
has existed II has been filled by bank
notes. This was the case In the panic of
1873. The process of taking out notes
might be made more expeditions. That
Is matter of machinery and OF reguia-
fs profit In issuing bank circulation Ii
will be issued If there is no profit In 1t
we must conclude either that the law
needs amendment or that the demand for
currency Is slight.
Mr.. White believes that in process OF
time IL will not be possible to rely upon
national bonds as security for bank note
issues, because of the extinction of the
public debt. In reply 10 the question
whether any safe and practicable plan
can be devised for using other securities
he says that he thinks not II should
not like to be charged with the RESPONSE
biilty OF selecting the securities or choos-
ing between the different kinds offered"
He believes that 80 per cent. Of the paid
up and unimpaired capital OF the bank
should be the limit of the note issues. and
that cash reserve should be held for the
redemption OF notes, the same az now
provided by law for deposits. that Is, IS
per cent. IN reserve cities and IL per cent
elsewhere, with the right 10 keep three
hfths OF the Is per cent. in the reserve
cities. There Is no difference between
deposit liabilities and note liabilities. 80
far az the bank itself Is concerned. and
no reason why the reserve should he
greater or less for the one than the 9TH
err. The reserve should consist OF gold,
and should be in the vault OF the bank
or in the clearing house repositories 9th
or questions regarding the best plan for
establishing and regulating banking
currency were answered by Mr.. White
as follows:
Approves baltimore Plan.
In general / approve OF the plan adopt
ed by the American Bankers Association
IN Baltimore in October. 1894 common
~ called ''the Baltimore plan" All bank
notes should be redeemable nj the COM
mercial center OF the country and also
AT their counters. Perhaps an exception
should be made OF the Pacific coast on
account of distance. The requirement ut
redemption 81 the banks counter was
found to work no hardship under the
SUnclk bank system since as much spe-
Gle was customariy deposited In the
country banks as was called for by de-
positors or note holders.
What IL anything beyond provision for
immediate redemption is reefed for So
curing the elasticity Of note issues in Pc
RODS Of normal business7
Ability TO issue notes promptly IL az
nesdfui as prompt redemption.
In times Of panic or sudden s1ringency.
| how would Won provide for additional
issues by the banks. 10 enable them 10
continue discounts and prevent CONNER
ciai DISTRESS
would allow an extra issue equal 10
y per cent % the banks capital confi-
iIonal upon the payment % tax at the
rate Of per cent. per annum 20 the gov