New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1899-01-01
TO EFFECT CURRENCY REFORM
CONTROLLER DAWES URGES HEARTY
SUPPORT OF PRESIDENTS PLAN.
TIE SUBJECT DISCUSSED BY HIM BEFORE CHI
CAGo COMMERCIAL IMPROVEMENT
AND BANK NOTE CURRENCY
CONTRASTET

Chicago Dec. 3-Charlcs G.. Dawes. Controller
OF the Currency was the guest Of the Commercial
Club this evening. and delivered an address on
Currency Reform. He said In part:
I'm the election OF 1896 the chief issue before the
American people for settlement that OF the
maintenance Of the gold standard and n sound gov
ernmcntal currency. The commercial crisis Of 1898.
with the consequent reduction In governmental
revenues. has developed an Inherent weakness In
our present monetary system which before that
time had been latent. This largely due to two
causes: first the disproportion existing between
demand governmental currency liabilities and the
gold held by the Treasury for their redemption;
second. the fact that these demand currency abili-
ties like grcenbacks. being redeemed in gold.
could he paid ont again for Government expenses.
thus making possible further presentation for
gold redemption and creating what has become
commonly known the endless chain
The question now before the Congress OF the
United States il that of the proper Interpretation
into law of the voice Of the people. expressed In
1856 in favor OF sound money and the gold standard.
The President OF the United States has In two sue
cessive annual messages to Congress recommended
a plan by the adoption OF which the Government
can protect properly It's outstanding currency Ia
biliiies and break the endless chain without con-
tracing the currency or seeking assistance from
private corporations in meeting its obligations OF
gold redemption.
"The lessening Of the disproportion between the
demand currency liabilities and the gold in the
Treasury with which to redeem them for the ac-
complishment Of which surplus governmental reve-
seemed one year ago absolutely essential has
been brought about by the financial operations Of
the Treasury incident TO the war. and by the grow
ing confidence Of people in the stability OF the
gold standard. which has led them to freely deposit
gold in the Treasury In exchange for notes AZ
pointed out In the Presidents las, Message. the
proportion of net gold holdings to demand cur
rency liabilities of tho Treasury November I.
rod VIII
on November l. 1897 Recognizing these conditions.
the President In mis- last annual Message to Con-
gress makes a recommendation. which, If enacted
into law. would break the endless chain and still
further strengthen the condition OF governmental
currency. already so greatly improved by the
Treasury operations Of the last year. His words
are as follows In my Judgment the present con-
dition of the Treasury amply justfes the I'm
mediate enactment Of the legislation recommended
one year ago. under which portion of the gold
holdings should he placed in trust fund, from
which greonhacks should be redeemed upon pre-
sentation but when once redeemed should not
thereafter be paid cut except for gold
THE words OF his recommendation in 1891 were
that when any Of the United States notes are pre-
scented for redemption In gold and are redeemed in
gold. the notes shall be kept and set apart and
only paid out in exchange for gold. This is an OBJ
vious duty
PRESIDENTS PLAN FOR MONETARY REFORM
of the. United states upon the nature Of the de-
mand of the people in lS1 for monetary reform
and while not denying. as his Message shows, the
necessity Of other legislation which he leaves 10
the wisdom of Congress. he strongly urges It's en-
actment into law Before the consideration OF any
Of the banking bills upon which there is such diver
sity and conflict OF both expert and popular opin-
ion this plain practical and simple solution OF
the governmental currency situation suggested by
the President should pass into law. To his PLAN
easily comprehendod by the body of our citi-
gems all those in favor of currency reform should
give their unqualified and loyal support,
ITO press the consideration Of other proposed
remedies at this time will prove hndrance and
obstruction TO the adoption OF this recommenda-
ton. which Is plainly step In advance Aiter this
recommendation is enacted into law, those VINO
have what seems to them more complete remedy
can then present IT for consideration. There are
many sincere and able men who maintain that the
Government can 20 It's own advantage and Tor inc
common good avail itself indirectly Of the note
issuing function Of National banks. they believe
that this can be accomplished by removing the
present restriction requiring as security for pank
notes tho specific deposit Of Government bonds so
that the bank Will assume the burden Of gold re-
demption of Government notes. In order 10 secure
the profit from the issuing Of bank circulation 10
take their place
''It must be remembered. however, that the pres
ent condition of the revenue finances and credit
of our Government clearly indicates That there II
no eycrse TO be found in Governmental necessities
for any legislation which would be unwise. II inc
interests OF the people and the business community
alone were considered. II the improvement III gov
ornamental currency could not be secured except ny
n radical change IN banknote currency there would
be ground for a demand for the concurrent consul
GRAFTON OF governmental and banking currency reg
isla,t,n But when the improvement oil governmental
currency is possible otherwise. the chances lot II
should not be jeopardzed by the refusal OF the au
voca,es of bank asset currency TO present 'he'r
case tpon ts merits alone. At present among those
who favor a system Of bank notes secured by the
commercial assets Of banks there docs nor steIi ~
be that definite agreement upon ana accrp,ace W
ceiva even the united support Of those who believe
I'm the practcabity under our banking sys,enn oo or
har,, asset currency Some Of the plans OF one year
AGO differ from those advocated to-day. the Two
bills having their source In the house m fron
oncb Other and neither commands the united sup
port Of that committee
PROPOSED REFORM MEASURES
Each Of these bills differs from other plans
suggested Evidently time must elapse before even
the friends of this particular kind Of currency can
he united on measure. MAINTAIN tnal mo
Fundamental proposition which underlies all pres
cnt bills providing for bank currency without gov
eminent bonds as security haey ,e - the dis
tribItion OF the assets Of an insoyent Dank would
work a grave Injustice upon the depositor class OF
the country, with results In the highest degree III
tmr,ous 10 Inc whole community. ,,,.
"If the preference or the Ddhh ASSET Ho'e-"o
over the aeposltor provided for by pending plans pan,
he decided unjust and inipractcabe ana an auuio
t,onaI tax up0n circulation De proposed 70 remove
this injustice new elements OF uncer'1in'y nre m
REDUCED and the question must also De u'seI i!
uSether in new estimates OF the tax upon soN.ht
narticipaiing banks necessary to MAKE up .ns
trsses on the notes have any right TO aSsuins
,hat ali or a large proportion of the sound panks
viii 20 into the uncovered note issuins % ."nid
and II only few banks Issue notes now we cou nd
",ro that few from being the smallest anu
r"aakes, hanks in the system. ana now, II ie"
49,, I'D ceak hanks only issue notes at hrst the
,"~ on such circulation TO make up losses can DE
tHd Down so az to invite that general participation
,eu 80, note issuing by sound banks FOR ne pur
pose Of profit which would be ssen ana To a ans ohe
lulc must be settled and rightly, before me
qneaiiao" I'm consent TO the abandonment OF the