The herald., 1897-11-10
THE BULLITT PROPOSITION

THE BULLITT PROPOSITION
John c. Bullitt is Philadelphia law
yer an attorney for railroad and trust
companies, and his business brings him
into contact with Wall street operators
and the big money men of the country.
His financial views are an outgrowth
from his associations. The proposition
he has put forth indicates where he has
received his education, and as might
have been expected, any financial meas
ure originating with him would take on
the color of his surroundings.
Mr.. Bullitt's proposition has the merit
of being explicit and clean cut for it
practically wipes out everything of our
money system except gold and the ma
tional bank notes. Though it leaves
other forms of money in existence, it
changes their basis in several important
particulars. Silver may circulate, but
the government is to be required on de-
mand to take it all in and give out gold
for it. The $500, 900, 900 of paper is to be
funded into 8 per cent bonds. and
they, together with others now or here
after outstanding are to be used as Sc
curity for national bank notes. To the
extent of about S600,000,O00 non-interest
bearing debt will be converted into that
which bears interest, and the people are
20 be taxed on account of the change
S1s,000,0O0 annually. That feature viii
hardly be palatable to the taxpayers OF
the country.
That the government may be able to
redeem the silver and subsidiary
coins it will be necessary to keep a sur
ficient sum in gold in the treasury. and
how much that will be is not and cannot
be definitely stated. The banks are to
be required to deposit with the govern
ment in gold Is per cent of their circula-
ton and to keep in their vaults Is per
cent, making so per cent in all, which
must consequently be kept out of circu
lation. If the banks should issue notes
to the amount of $1,000, 900 900 there
would be kept in retirement $500, 900, 900
of gold. The proposition is calculated to
constitute our money entirely of gold
national bank notes, and such an
amount of silver as would be tolerated
in circulation. This would absorb one
half or more OF our present stock of gold
money if the banks should issue notes
to the extent supposed. If they should
issue larger sum our stock of circulat-
ing gold would be further reduced.
According to Mr. Bullitt's plan, cur
rency board is to be created which is t.
regulate the issue of bank notes during
the time the greenbacks are in process
of retirement, and to have power to in
crease note issues as the business of the
country requires. 1t cannot be sup
posed that it is intended that the cur
rency board will be authorized to COM
pei banks to issue whether they want to
or not. How such a power could lie
executed is by no means clear. A horse
can be led to water, but he cannot he
lilstut W vi lilH lSSulllS llolcS rs Il mat =
ter of business. The regulation of the
volume of money to meet the wants or
the country is most important. Bank
ers, and especially those in charge OF
banks OF issue, ana under such re-
straints and surveillance as will insure
safety to note holders, are SO extremely
conservative that they would be inclined
to cramp business through inadequacy
of the circulating volume. They GER
tainly would avoid creating redundancy.
ard the currency board would have diff
ample volume if it thought there should
be an increase. 1t is probable that thu
board would be more under the control
OF the banks than the banks would be
under the control of the board.
The country would hardly look com.
placenty upon q money system which
confers upon the banks so much power
as Mr. Bullitts proposition conteln-
plates. Ever since Andrew Jackson
demolished the old national bank the
country has been suspicious of banks
on account of their money and political
power The plain people. however,
have never been unfliendly to treasury
notes. Opposition to them has beer
from other sources. The contest over
the money question during the next ses-
sion OF congress promises to be one in
which the country viii take the deepest
interest. 1t is not difficult to provide a
sound circulating medium but to pro-
vide volume adequate to supply busi.