The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1898-01-03
REPORT AND PLAN OF THE NONE
TARY COMMISSION.

The most obvious comment on the report
of the Monetary Commission is that it is
eminently business-like. That might have
been expected from a commission composed
of representative business men and deriving
its authority from the largest convention
OF business men ever held in the country.
The report consists Of two partisan argu-
ment or statement setting forth the Ge-
fects of our present currency system and
the necessity for reforming H. and plan
of reform. The argumentative part is
strong. comprehensive and lucid to re-
markable degree. Temperate and dignifed
in tone and conspicuously free from an
tagonizing points, it makes a presentation
of financial facts. principles and conclu-
sions that is at once educational and con-
vincng AS an argument in favor of cur
rency reform it is unanswerable.
In it's proposed plan of reform the COM
mission has evidently kept in view the in
structions of the convention which created
it. These were as follows:
First. that the present gold standard
should be maintained. Second, that steps
should be taken to insure the ultimate re-
tirement of all classes of United states
notes by a gradual and steady process. ana
so as to avoid injurious contraction or the
currency or disturbance of the business in
terests Of the country, and that until such
retirements provision should be MADE LOT
separation of the revenue and note issue
departments of the treasury. Thlrd, tnat
banking system be provided which shoul9
furnish credit facilities 10 every portion OF
the country and a safe and elastic circula-
ton and especially with a view OF secur-
ing such distribution of the loanaDie cap
ital of the country as viii tend 10 equas!lze'
10 Zoo nf f0fa
That is a fair summary of the points
aimed at by the commissions plan, which
embraces the best features of Secretary
Cages, with some new ones of Importance,
and decidedly better machinery for carry
ing them into effect than the Gage plan or
any other yet proposed It deals separately
with the government currency, metallic and
paper, and with the banking system. No
material change is proposed in the metallic
currency. 1t is provided that 1.-The existing
gold standard shall be maintained and
that mo silver dollars shall be hereafter
coined" All obligations of the government
now existing or hereafter emit .ed into are,
unless otherwise expressly provided, to be
payable in gold coin. This makes the issue
clear, and invites the opposition of all OPP
ponents of the gold standard Silver coins
of less denomination than one dollar will
continue to be coined, as now, and pro-
vision is made for maintaining the absolute
parity of the silver dollars now coined. The
issue of silver certificates of small denom-
nation is to continue, but no United States
note nor national bank note shall hereafter
be issued of q denomination less than So
The evident intent of this provision is to
make room for silver and familiarize the
people with it as the currency of everyday
business. Its effect would be that the en-
tire currency of the country below the de-
nomination of $40 would consist of silver
and silver certificates, with $3.50 and IS gold
pieces.
The most important feature of the plan
relating to government currencs is that for
the gradual retirement of the grv"rnmcnt's
demand obligations, including =. acks
and treasury notes of 1890. The y isions
on this subject are very conservative and,
free from the objection o. raa 'oHusm. 1t is
provided that the notes SHALL be Cancelled
as paid, up to the amount of $5O,OC0,OJ0; that
limit being reached the annual cancellation
during the next five years not to exceed
the increase of national bank notes; after
that. the notes to be retired at a rate not
exceeding. in any year, one-ffth of the
amount then outstanding; the legal-tender
quality of the greenbacks to cease at the
end of ten years. Under this provision the
amount of treasury notes retired would
never exceed the amount of bank notes is
sued, there would be no contraction of the
currency, and the retirement of the treas
ury notes would cover a period of fifteen
or twenty years. If they are ever to be re-
tired at all it cannot be done more smooth
ly, safely, gradually and satisfactorily
than by this plan.
The plan provides for a bank system
which shall be thoroughly national, but diff
ferent in some essential respects from the
present one Recognizing that the issues of
government bonds must cease and those
now outstanding mature and be redeemed
before many years, other provision is made
for security for circulation. This provision
is as follows: First. % per cent. of a banks
circulation shall be based on a deposit of
government bonds and rs per cent. on the
convertible assets of the bank, the total
amount in no case to exceed the amount
of the banks paid-up and unimpaired capt.
tall second, beginning five years after the
adoption of the new plan the amount of
bonds required to be deposited shall be re-
duced 20 per cent. each year, and there
after any bank may withdraw all its bonds
The effect would be that at the end of ten
years the circulation would be based on the
assets of the bank and the added security,
first of a common guaranty fund of per
cent. in gold of all the notes outstanding;
second, the continuance of the present
method of redeeming national bank notes.
and third, the liability of every stockhold-
er for the redemption of the notes to the
full amount of his stock. The commission
believes this would make the notes abso-
lutely secure. The effect of the per cent.
guaranty fund would be to make every ma
tional bank responsible to that amount for
the notes of every other one. and in the ag-
gregate the fund should be sufficient to
cover all contingencies. The plan also in
creases the stockholders liability for notes,
so that each stakeholder is absolutely liable
to assessment up 10 the par of his stock,
and not ratably and equally with every