The times. [volume] (Richmond, Va.) 1890-1903, 1897-02-23
An INTELLIGENT OPPONENT OF
STATE BANKS.

The letter from Warrcnton, va, slgneu
| Farmer. which was published in Sundays
| Times contained on argumentative state
ment OF objections TO State banks Of Is
sue. which are n real contribution to the
| discussion. Men who think that they
dispose of the subject by epithets. slurs
and ridicuie are not worthy Of serious at
tentlon, But where an opponent Of the
system brings forward well-considered ar
euments like those of our correspondent.
they should be met with arguments Of
the same character. and progress VIII
/ then be made toward Just conclusions.
| whatever direction those conclusions may
| take. Tho gist of what our correspond
ent has TO say is contained in the follow
J ing passage from his letter.
| When the farmer gets dollar he wants
the best dollar. not a cheap one. II he
has corn TO sell, he has no difficulty IN
getting good money for 1t, nor do NC
find difficulty in getting the best money IN
pay for our cattle or hogs or peanuts or
| tobacco. IL we have any for sale.
When we have nothing TO sell we can
not get money at all-gOod or poor
And If we try to get money on horses
IL is very difiicult-not only here IN the
country. but even in the great city OF
Richmond.
Now. if we had local banks Of issue
how would 1t help tho farmer? Would IL
make the price of corn or cattle or TO-
| bacco higher? We can always get the
best money now for our produce and we
| would he apt to demand United states
notes for our produce when we sold H.
for we want only the best money In pay
for our low priced produce
The proposition is to have good state
hank notes. The First National Bank OF
Richmond and the Planters National Bank
of Richmond. for example are both
sound banks and both have out their
notes. II these banks should surrender
their national charter and take state
charters. does our correspondent suppose
that they would thereafter be less good
banks than they are. or that their notes
would become bad notes?
For twenty odd years before the war
the banks Of Virginia had out an average
circulation of more than 100000 which
we're as good as any notes this country
ever saw, and no man before the war
ever lost a dollar by a Virginia bank
note Why could we not again have notes
of States banks just as good as those?
The proposition of those who advocate
State banks of issue is that their notes
shall be payable on demand in gold coin
under the severest penalties, and it is
also expected that the State Legislature
will provide effectual safeguards to Sc
cure the notes, though The Times thinks
that the more the matter is left to the
laws of business and the less statute
! law We have, the better il would be. We
can see no reason TO suppose such notes
| would be bad notes and we insist that if
it Is necessary to take precaution to
protect the public against bad notes, the
! Virginia Legislature is just as capable
/ of devising those precautions as the con-
! gress Of the United tSates.
The next question raised by our cor
respondent which 1t seems important to
discuss is implied in his suggestion that
/ if a Virginia farmer has anything to sell
he can now get for II United States
money. That is very true but ability to
send products away and exchange them
for money that is located at the distant
place. and having at the farmers door an
abundance of circulating media Of which
| he can always command a sufficient
amount for any enterprises he wishes TO
embark in are two Radically different
things Though he can always send his
wheat or corn to a seaport and exchange
it there for United States money, yet.
when he has paid that away in the sea-
| port for the clothes and groceries that his
family needs he has nothing with which
TO buy the fertilizers and hire the labor
necessary for the next crop. But
| there were bank at his county seat
/ that could issue its notes. he could borrow
those notes buy his fertilizers and hire his
labor. and make his crop without dit
hculty.
There is one meritorious point in the
proposition Of the free coiners, and that
! is their claim of the necessity for al an
/ limited supply There must be enough
! for every locality TO have enough at all
times of circulating medium. Their
error is I'm slpposing tLat this should be
actual coined money. But while pros
pering business demands unlimited cir
oulating medium. it neither needs nor
will have much coined money. Business
will not transact its affairs with coined
| money That is a usage of unenlightered
ages that steam and electricity have
| caused business 10 discard. Busi-
| ness saws II can transact It's
affairs with credit substitutes for money.
| that they are far more convenient than
coined money and that 1t will not have
| tho coined money. More coined money
| therefore, would not help the case even
if it were money OF full value. but coin
ed money that is worth only half Of what
men are to be compelled to take it for
would be- simply destructive OF society.
But Mr.. Herbert Spencer says in the
third and last volume Of his great work
lust out. that money-a circulating ne
dium-has done more for promoting the
evolution of society 10 its present state
than any other and all agencies. erd he is
right We must have just as much cir
culating medium as all can have any use
for. but, under conditions, that circulate
ing medium must be credit instruments
and not coined money. 1t must rot even