Hutchinson gazette. [volume] (Hutchinson, Kan.) 1895-1902, 1898-11-10
c. e. sIDLINGER,
eREIpENrHAL's BANK PLAN,

BREIDENTHAL's BANK PLAN
For two or three years the GAZETTE
has continuously urged that some plan
be adopted for securing the deposllors
of lnsolyent banks, II 10 sure TO come
sometime and will be one of the great
est achievements Of the ninteenth
century In the commercial and indus
trial world. The curse Of the credit
system 10 It's instability. 1t 10 like an
inverted pyramid. A little jar Will
bring It down. OF course the secur-
ing of bank deposits would not en-
tlrely take this element out OF the
credit system, because banking Is only
one Of the many departments OF COM
merce which is done upon credit But
1t is the one department where the
danger Is most Imminent. IL Is the
one where it's connection with other
departments Is closest and most eX'
tensive. II is the one department
where a panic always finds IT'S start
ing point. II the deposits of all the
banks we're absolutely safe a general
and violent panic such as that OF 1898
would be impossible, 70 any plan for
taking away the element OF insecurity
which Is felt by every depositor, would
not only contribute to economy and
saving, but its influence on the gen
eral course Of business would be par
amount. There have been different
plans for accomplishing this purpose,
Usually II has been looked for through
government savings banks. That Ia
all right, but SIN 1t does not cover the
whole ground, 1t only covers the
small deposits and the poor mans
money, This of course Is most I'M
portant, but tho business mans de-
post Is not secure and the liability to
panic Is not eliminated. Then to, the
national Legislature is long way of
from the people and more difficult to
reach than a state Legislature,
1t has also been proposed that banks
be compelled to give bond for their de
poslts; but we all know what the usual
bond amounts to. We have several
examples of Il in securing this coun-
TVS deposits.
Another plan is to levy a small tax
upon the average deposits OF each
bank for establishing 4 reserve fund
to pay off the depositors Of those that
fail. This Is alright, except that in
this State we have constitution
which is thirty years in the rear OF
the times and Mr.. Breidenthal thinks
ii safer to avoid any kind of a tax, as
1t would probably be termed "spec-
ial tax" and declared unconstitutional.
SO he proposes that each bank shall
deposit . per cent Of Its deposits
with the state treasurer. This snail
be reloaned to the blnkers at q per
cent upon bond given In a security
company. and the interest from this
fund he thinks would be sufficient to
pay the depositors Of the banks that
fail.
Mr.. Breldenthal says he did not
favor any such measure during the
last Legislature because the banks were
then not in shape to stand IL. Now
he says they are. Many, in fact, most
of the bankers now, he says, are not
opposing his plan and he hopes to get
it through the next legislature 1t Is
to be supposed that the national banks
would be opposed to this scheme, as 1t
would destroy their business IN the
State. II would mean that no one
would deposit in national banks when
they could be safe from loss by depos-
iting in the state banks, Yet, Mr.,
Il. L. Meyer, president Of the First
National bank in this city, who list
ened TO Mr.. Breidenthal outline his
plans, was converted to 1t and says 1t
is alright.