The Saint Paul globe. (St. Paul, Minn.) 1896-1905, 1898-01-05
THE sUBTREAsURY SYSTEM.

$3.50 ODSSA
THE SUBTREASURY SYSTEM.
The chamber of commerce of this
city enters not only a protest against
the establishment of branch subtreas-
ury in the Northwest, but demand
that the whole system be abolished.
"Any SYSTEM" it declares, 'that re-
ouires the money received by the gen
eral government in the course Of its
business to be Withdrawn from cir
culation and locked up in a separate
and private safe of its own is neces-
6arily injurious to the industrial and
commercial interests of our people"
Thus again we hear the note that was
30 loud and the demand that was so
strong prior to the passage of Van
Ruren's subtreasury measure some
sixty years age. II was one of the ar
guments used for the establishment Of
The United States bank and for it's
reincorpOrations 1t was the demand
met by Van Buren, when he called con-
gress in special session in September,
1887, to face the governmental difficult
ties caused by the system now demand
ed to be reinstalled by our chamber of
commerce, a measure presented to con-
gress in one of the ablest papers ever
presented to that or any other legisla-
tive body.
Without discussing the merits Of the
subject a review of the conditions which
gave rise to the suhtreasury system,
une that has endured the muta tons of
party government and proved it's eff
c&cy for nearly sixty years, is peril
nent. Until Jackson succeeded in over
throwing the federal bank it was the
depository of the revenues of the
nation. These were treated as pri-
vate deposits are and loaned out again
TO those seeking accommodation. When
congress refused to recharter the bank
Jackson removed the treasury's depos-
its and placed them among private
banks under the act of 1888. That pro-
vided every defense of the funds which
the ingenuity Of congress could de-
wise Personal security and frequent
reports Of condition were required.
Prompt payment of the deposits on de-
mand was a condition of continued de-
post. Among the deposits was that
surplus which congress, to get rid of,
apportioned among the states as a loan.
The notes of the banks had been re-
Ceived in payment of public dues, es-
pecially those for purchases of public
g land. There ensued, from this plethora
Of money and the unguarded banking
laws Of the states, an era of specula-
ton such as this country terminated
in 1898. Jackson, finding specie avoid
ing the revenues and, possibly, fore
seeing the inevitable collapse, ordered
payments for land purchases to be
made in gold and silver. In addition
came the demand upon the banks for
money for transfers of the surplus to
the states. Coincidentally, English
creditors, who had been running the
same mad race Of speculation, demand
ed payment Of their debts. The result
was a collapse of all banks in the panic
Of 1887, the insolvency of their notes
and the bankruptcy Of the government.
unable to get funds to pay its expenses.
1t was to face this condition, both
public and private. that Van Buren,
summoned congress and laid before it
his objections to the bank-deposit sys-
TEN and his arguments for g, subtreas-
TRY, where the funds of the govern
ment would be secure against those
spasns OF speculation that, whenever
they come, unsettle the Judgment and
overcome the prudence of even the
most conservative of men. His mes
sage is d paper to which Democrats to-
Gay may well go for inspiration to
their waning faith, and it Is q, paper in
the study OF which others with vague
conceptions Of the functions Of govern
ment might find clear conviction. The
plain, cold truth told by the president
WAS met by an outburst of wrath in
which men like Clay and Webster
Joined. Webster denounced the prop
osition to suspend the deposit CT the
Eurplus with the states. He, too, wanted
the public money TO circulate John
Quincy Adams urged the re-establish-
ment Of the federal bank to keep the
money in circulation. Clay was horror
stricken at the heariiessness CT the az
cniniatrGtion, that left the states, the peo-
PIE and their hanks to shift Cor them
selves. each and all Of whom we're en-
titled 20 the protecting care OF 2 paren-
tai government
Eut against 81 this outcry YAH Bu-