The news & observer., 1897-02-25
4 BLOW AT THE STATE BANK
SYSTEM.

AR Hile1nan has introduced a olil 10
compel every State bank IN North ts'po-
lima to pay over to the State treasurer
ONE per cent of it's capital stock, whlch
funa shall be used to protect the State
from losses occasioned, we suppose, upon
deposits in insolvent banks. If thas OIL
shall he amended so as to apply only
| to such banks as shall make application
to become State repositories, there Is no
special objection to it.
Tf applicable to all State banks, whether
| State repositories or not, it is a specles
of co1fscatton of the property of the
stockholders that is disgrace to amy
| intelligent Legislature. There cam be
no inst reason advanced for coniiscation
and appropriating one per cent of the
capital of the State banks in order that
the State may be protected i'm its dealmgs
with some other bank. Let the State
nrovide for its own protection by requ1r-
inc from those State banks IN which the
money of the State is deposited security
such as North Carolina State bonds and
other good securities to be approved by
the State Treasurer for the safe keep
ing and the prompt payment over of all
State deposits. There are State banks
in North Carolina THAT have no State
funds ON deposit and don't wish any. To
take away from such banks one per cent
of their capital stock, is as illegal as if
the Legislature should take twenty-five
per cent of it.
This is not an exercise of the taxing
power of the Legislature and it is not
pretended that it is a tax. lit is simply
legislative oppression and an unjust dis
examination against the institutions of
the State itself who pay their tax into
the State Treasury, and it has a tendency
to induce the establishment of National
banks instead Of our own State imstitu-
tons. We have understood that the Popu-
lists were opposed to Naitbonal banks and
favored and encouraged the establish
ment of our State banks.
Such legislation as this will destroy the
State bank system in North Carolina. 1t
IS a species of Legislative tyranny. The
Legislature says to the banks of the
State with its pistol at their heads you
must deliver up SO much of your capital
or we VIII repeal your charter and put
IL. NT t1n
State banks are the only institutions that
lend money on lands and such other
securities as farmers have TO offer. II
the Legislature discriminates against
them,it strikes serious blow at the
credit and prosperity of the State. The
taxes derived from these banks all go in
| to the State and county treasures and
constitute a very material part of the
public revenue. When the Legislature
destroys them, it cripples the State it
self
Such a measure, not being the exercise
of the taxing power of the State, is clear
ly a violation of the United States and
Of our own State Constitution, which pro-
hibits taking private property without
compensation and without due process of
law. It is beyond the power of the Leg
islature to require one bank to become
partially responsible for THE defalcations
of another bank. The Legislature should
remember that the stock in State banks
is owned by the citizens of this State al
most exclusively; that it belongs to the
poor as well as to the rich; to widows and
to orphans, and to take unjustiy and
unwarrantly a portion of their capital
stock is taking the property of the CITI-
ZENS of this State. ''It is nevertheless
robbery, although done under the forms
of law"
There cam be excuse or justification
| except to protect the State from possible
losses ON it's deposits. This end can be
better and more justly attained by re-
quiring those banks desiring TO become
custodians of the States money to Sc
cure the State against any possible loss.
The attention Of the Legislature is called
to the great injustice and hardship of
such legislation as this ITO our State in
stitutions, many of which are young and
struggling hard against the strong COM
petition of old and established National
banks, and cannot afford to yield up a
part of their capital.
THE LEASE MUST BE AN
NULLED."
Writing nf hha 90 yaa. Ioacn In 4bo