The Salt Lake herald. [volume] (Salt Lake City [Utah]) 1870-1909, 1898-03-24
House Republican Ideas of a Way
to Strengthen It
NATIONAL BANK MACHINE
ALL RESPONSIBILITY TO BE
CAST IN ITS HOPPER.
Burden Will Rest Upon Banks of
Finding Gold For the Legal Ten
der Notes Which Will Take the
Place of Greenbecks, Retired By
Indirect Methods.

Washington, March 23.-The report of
the Republican subcommittee to the
house committee on banking and cur
rency was laid before the full Repub-
lican membership of the committee.
This committee, which was appointed
a month ago 10 report a general bank
ing and currency measure, consists of
McCleary of Minnesota, chairman;
! Prince of Illinois and Mitchell of New
/ York. The bill they have reported is
4 entitled: "A bill to provide for
| strengthening the public credit, for the
relief of the United States treasury
and for the amendment of the laws
relating to national banking associa-
tons" The method of dealing with the
greenbacks is not by direct retirement,
but by the substitution of a legal ten
der note, which the banks are required
to assume, and for the redemption of
which they are required to find the
sold, so long as they are conducting
solvent business. The principal provi-
sions of the bill are as follows:
l. A division of issue and redemption
is established in the treasury for the
secretary of the treasury is authorized
to set aside the general cash balances
in excess of $50 000, 900. This excess on
March II, 1895, was SIG, 1882 United
States notes received by this division
for redemption in gold are to be can
celed and retired in proportion as
certain substitute currency is issued.
No note redeemed in gold is to be again
paid out, except under exceptional con-
ditions.
RESERVE NOTES.
2. National banks are required to as
sumo the current redemption of United
States demand notes in order to obtain
circulation based upon their CONNER
cial assets. \ new class of notes, called
national reserve notes. is to be issued
in lieu of legal tender notes deposited
by the banks with the treasury, and
these reserve notes are to be redeemed
upon demand by the banks out of the
redemption fund which they are re-
quired TO maintain in gold. These re-
serve notes are not treated in any re-
spect as bank notes, because the banks
are not liable for their ultimate re-
demption. The basis of national bank
note circulation viii be the commercial
assets of the banks, but this will be
reached only after series of years
4. National banks are TO be permitted
to issue currency notes on their COM
mercial reserve to the amount of the
reserve notes issued to them in deposit
for United States notes.
D. treasury notes issued under the act
or July Il, 1890. are TO be dealt with
eventually on the same basis as United
States notes.
TAX OF TWO PER CENT.
6. A tax of per cent is levied upon
currency notes issued in excess of so
per cent of the capital of any national
bank. and of per cent when in excess
Of so per cent
Z. The national currency notes based
upon commercial assets are TO be Sc
cured by bank note guaranty fund.
made uD by the contribution in gold
coin of PEI cent of the entire circula-
ton of the bank. and provision is made
for replenishment of this fund within
certain limits.
s. The national reserve notes will
continue to be legal tender until re-
ceived into the treasury from failed !
and hquidating banks. when liability
for them will be assumed by the gov /
eminent. and they will be redeemed I
and cancelled.
SILVER REDEMPTION.
9. Standard silver dollars are to be
in gold, but silver certifi- /
Gates are redeemable only in standard
silver dollars. TIE parity of silver with
gold is secured by a gold redemption
fund.
10. Silver certificates are hereafter to /
be issued only in denominations of 81,
81 and s.. Legal tender notes. reserve
notes and currency are to be issued
in denominations below $40.
II. National banks are required to
pay a tax OF One-eighth of l per cent
on their capital, surplus
and undivided profits.
- National banks are permitted to
establish branches, under regulations
to be prescribed by the secretary of the
treasury.
PURPOSE AND EFFECT.
THE purpose and effect of the pro-
posed bill" says the report. lis to
throw upon the national banks the en-
tire burden of finding gold for the
notes. There is no doubt of the abil-
itY to do this, if ii is required by Law.
They have the power to regulate in
terest rates within the narrow limits
marked out by economic law in such
q manner as to attract gold to the
country by restricting their circulation
when necessity arises. The system
by your committee provides
IN easy and adequate method of OBJ
tanning gold for export from the banks
without exposing the country or the
United States treasury to the alarm
and CONFUSION which have attended
gold exports during the last five
years."